EXHIBIT 10.37
CONTRIBUTION AGREEMENT - BASIC ECONOMIC TERMS
(EL CENTRO CENTER)
The undersigned Transferor agrees to transfer the Property to the
undersigned Transferee and Transferee agrees to accept the transfer on the
following terms and conditions:
1. Incorporation by Reference. All of the terms and conditions of:
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a. The General Conditions to Contribution Agreement (the "General
Conditions");
b. The Addenda to General Conditions to Contribution Agreement (the
"Addenda");
c. The Exhibits to General Conditions to Contribution Agreement (the
"Exhibits"); and
d. The Schedules to General Conditions to Contribution Agreement
(the "Schedules")
which are attached hereto are incorporated by reference herein as being the
agreement of the undersigned.
2. Project. EL CENTRO CENTER.
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3. Transferor. CENTER OF EL CENTRO, acting on behalf of its Constituent
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Partners
4. Transferee. XXXXXXXXX XXXXXX PROPERTIES OPERATING PARTNERSHIP, L.P., a
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California limited partnership.
5. Consideration to Transferor. The total sum of
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$6,985,378/1/ which is comprised of the following elements:
a. Existing Debt $0
b. Prepayment Fees and other Lender related expenses
charged against Transferor $0
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/1/ The Term Sheet Consideration of $7,767,234 has been reduced by $151,311 to
cover the reduction in Net Operating Income because KB Toys is a gross lease not
a net lease. The Consideration has been further reduced by $512,295, which
represents the Capitalized Value of the sum of $50,000 (which is based upon
Transferee's consultant's estimate of percentage rent). See Special Provisions
paragraph 7.c., below. The consideration has been further reduced by $63,800 for
Roof Tie-Ins, Mervyns. The consideration has been further reduced by $54,450 for
Roof Replacements and Tie-Ins, Millers.
c. Commission obligations of Transferor paid by
Transferee and charged against Transferor $ 0
d. Transferor's share of Closing Costs (estimated) $25,000
e. Prorations charged against Transferor (estimated) $ 5,000
f. (Miscellaneous) $ 0
g. OP Units $1,738,844
h. Cash $5,216,534
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i. Total OP Units and Cash (being the aggregate of
the "Constituent Partner's Equity") $6,955,378
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j. Total Consideration $6,985,378
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The Total Consideration is subject to adjustment as provided herein and in
the General Conditions, the Addenda, the Exhibits and the Schedules.
6. Allocation. The Cash (subject to adjustment as provided in the
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preceding sentence) will be allocated among the direct and indirect partners
(the "Constituent Partners") of Transferor as follows:
Percentage
of the
aggregate
of the
Name of Constituent
Constituent OP Units Partners' Allocated
Partner: (in $): Cash Total: Equity: Debt:
-------- -------- ---- ---------- ----------- ---------
Xxxxxx Not
Investments $ 0 $3,477,689 $3,477,689 50.000% Applicable
Not
Xxxxxx Xxxxxxx $ 0 $ 869,422 $ 869,422 12.500% Applicable
X. X. Xxxx Not
Residuary Trust $ 0 $ 434,711 $ 434,711 6.250% Applicable
Xxxxxxxx Xxxx Not
Marital Trust $ 0 $ 434,711 $ 434,711 6.250% Applicable
Bartfam Not
Partnership $579,592 $ 0 $ 579,592 8.333% Applicable
Not
Xxxxxx X. Xxxxxxx $579,661 $ 0 $ 579,661 8.334% Applicable
CJJ Limited Not
Partnership $579,592 $ 0 $ 579,592 8.333% Applicable
-------- ---------- ---------- ------- ----------
Not
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Totals $1,738,844 $5,216,534 $6,955,378 100.000% Applicable
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7. Special Provisions:
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a. The vacant parcel located on the Property (which is shown as
Parcel B on FATCO Order No. 4201-51, dated March 3, 1997) is included at no
additional cost.
b. Prior to the Closing Date, Transferor will deposit the sum of
$90,500 (the "Deposit") in a separate escrow account with Title Company pursuant
to an Escrow Agreement (which shall be in form and substance reasonably
satisfactory to Transferor and Transferee) which shall have the following basic
provisions: (i) each month Title Company shall disburse to Transferee from the
Deposit the amount of $2,083.33 (which is equivalent to and in lieu of monthly
net rent in the amount of $1,718.75 and contribution to common area maintenance
contributions of $364.58 on Suite B-5 which is currently vacant space as of the
date of this Agreement (the "Vacant Space")); (ii) if the Vacant Space is leased
pursuant to a lease or leases which require expenditures for tenant improvements
and leasing commission, such expenditures shall be reimbursed to Transferee by
Title Company from the Deposit; (iii) the disbursements under clause (i) shall
be reduced to the extent that gross rents shall be received from the Vacant
Space and shall cease at such time as gross monthly rents from the Vacant Space
equal or exceed $2,083.33; (iv) when the expenditures under clause (ii) have
been paid and rents commence as described in clause (iii), the balance of the
Deposit shall be paid over by Title Company to Transferor; and (iv) if gross
rents shall not have commenced on the Vacant Space in an amount equal to or in
excess of $2,083.33 within 1 year from the Closing Date, the balance of the
Deposit then remaining shall be paid over to Transferee.
c. Additional Consideration. To the extent, if any, that Net Overage
Rent (defined below) from the Property for the 12 calendar months ending on
December 31, 1998 shall exceed $120,000 Transferor shall be entitled to
additional Consideration in an amount equal to the Capitalized Value of such
excess, determined by dividing said excess amount by .0976. Except as provided
herein below, said additional Consideration shall be payable on or before
February 28, 1999. "Net Overage Rents" shall mean the overage rents actually
collected from the Property during the period from January 1, 1998 through
December 31, 1998 less an amount determined as follows for tenants who are
allowed a recapture of property taxes from their percentage rent: the
proportionate supplemental taxes which the overage rent paying tenants would
have paid for the new property tax assessment for the sale as though it had
taken place at the beginning of their overage rent period for which they are
paying, rather than the actual taxes they had paid for that period. The
additional Consideration shall be distributed to the Constituent Partners in the
ratios set forth in paragraph 6 above, both as to percentage thereof and as to
whether the additional Consideration is cash or OP Units based on the average
closing price for shares of stock of AHP for the five trading days immediately
preceding the payment of said additional Consideration. If reassessment of the
Property shall not have occurred or if Supplemental Property Taxes are not known
by February 28, 1999 such additional Consideration will be paid when such
reassessment is made; provided, however, that the actual tax amount for the
1997-1998 fiscal tax year shall be used if the Property has not been reassessed
by July 1, 2000. Transferor shall have the right to apply to the Tax Assessor
for reassessment as soon as possible following the Closing Date, and shall seek
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the lowest possible assessment. Transferee shall execute such instruments as
may be necessary to evidence Transferor's authority to apply for such
reassessment.
d. Format - Immediately prior to the Closing Date, Transferor will
convey the Property and assign its rights hereunder to its Constituent Partners
in the undivided percentage interests shown above in the fifth column of
paragraph 6. Each Constituent Partner will convey an undivided interest in the
Property to Transferee. Transferee will cause the OP Units to be issued and the
Cash to be paid to the Constituent Partners as shown in the second and third
columns of paragraph 6 above. The Constituent Partners severally and
proportionately will assume the obligations of Transferor under the
Representations and Warranties and Transferor will be released from liability
under the Representations and Warranties. Notwithstanding the foregoing, each
Constituent Partner shall be solely responsible for his own investment
representations and investor suitability representations.
Executed as of March 23, 1998.
Transferor: CENTER OF EL CENTRO,
a California general partnership
By: Xxxxxx Investments,
a California general partnership,
general partner
By: WWH Investments, Inc., a
California corporation,
general partner
/s/ Xxxxxxx X. Xxxxxx, Xx.
By: ______________________________
Xxxxxxx X. Xxxxxx, Xx.
Its: President
Transferee: Xxxxxxxxx Xxxxxx Properties Operating Partnership, L.P.
a California limited partnership
By: Xxxxxxxxx Xxxxxx Properties, Inc., a Maryland
corporation, its General Partner
By: Xxxx Xxxxxxx
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Its: Senior Vice President
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AGREEMENT OF TITLE COMPANY
The undersigned executes this Agreement for the purposes of acknowledging its
agreement to serve as escrow agent in accordance with the terms of this
Agreement and to acknowledge receipt of the Xxxxxxx Money from the Transferee.
First American Title Insurance Company
By:_____________________________________
Its:____________________________________
Date: ________________________, 1998
Escrow No. N 984017E
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