EXHIBIT 10.2
------------
(JMB - XI)
August 5, 1999
Shopco Advisory Corp.
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xx. Xxx Xxxxxx
Xxxxxx Brothers Holdings, Inc.
0 Xxxxx Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xx. Xxxxxxx X. Xxxxxx
Re: Riverside Square
HACKENSACK, NEW JERSEY
Ladies and Gentlemen:
Reference is made to that certain Purchase Agreement dated as of
July 22, 1999 (the "PURCHASE AGREEMENT"), by and between RIVERSIDE 062
PARTNERS, L.P., a Delaware limited partnership ("BUYER") and JMB INCOME
PROPERTIES LTD.-XI, an Illinois limited partnership ("SELLER").
Seller and Buyer desire to provide for (a) the extension of the
survival period set forth in the Purchase Agreement, (b) the reduction in
the amount of Seller's maximum liability and the required net worth of
Seller under the Purchase Agreement, (c) the delivery of certain estoppel
certificates by Seller, (c) the delivery to Buyer of a letter of credit in
favor of Urban Retail Properties Co., and (d) the transfer of a liquor
license owned by Ridgepost, Inc., and certain other matters as more
particularly set forth herein.
NOW, THEREFORE, in consideration of the foregoing premises, the
mutual covenants and conditions contained herein and in the Purchase
Agreement, and other good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, Buyer and Seller hereby agree as
follows:
1. DEFINITIONS IN PURCHASE AGREEMENT. Unless otherwise expressly
defined in this letter agreement, all defined terms used in this letter
agreement shall have the meaning set fourth in the Purchase Agreement.
2. EXTENSION OF SURVIVAL PERIOD. Notwithstanding Paragraph 7.C of
the Purchase Agreement to the contrary, and cause of action of a party for
a breach of the representations and warranties or other provisions
contained in the Purchase Agreement which are stated to survive the Closing
or in any document executed or delivered at Closing shall survive until
July 31, 2000, at which time such representations and warranties or other
surviving obligations ( and Purchase Agreement) shall Terminate.
Accordingly, the Survival Period shall terminate and expire on July 31,
2000.
3. REDUCTION IN MAXIMUM LIABILITY AND REQUIRED NET WORTH OF
SELLER. Buyer hereby acknowledges and agrees that (a) Seller has delivered
to Buyer a Tenant Estoppel Certificate with respect to the Tenant Lease for
each of British American House and Liz Claiborne, (b) such Tenant Estoppel
Certificates meet the Minimum Estoppel Standards (or has been waived by
Buyer Based upon the receipt of a Seller Estoppel Certificate), (c) the
limitation of liability contained in Paragraph 9.B of the Purchase
Agreement shall be reduced by an amount equal to $500,000, (d) the maximum
aggregate liability of Seller arising pursuant to or in connection with
the representations, warranties, indemnifications, covenants or other
obligations (whether express or implied) of Seller under the Purchase
Agreement (excluding Seller's indemnification obligations under Paragraph
9.A(2) with respect to claims for the payment of a brokerage commission by
Broker) shall not exceed $1,000,000. In this connection, Buyer hereby
further acknowledges and agrees that pursuant to the provisions of
paragraph 9.B of the Purchase Agreement Seller or its successor in
interest have the right to reduce its net worth on a current value basis
(or the amount of the reserves required hereunder) by an amount not to
exceed $500,000 (i.e., Seller or its successor in interest shall not be
required to maintain a net worth on a current value basis in excess of
$1,000,000 (net of any known liabilities) for the Survival Period or
establish reserves in excess of $1,000,000 in cash or reasonably liquid
investments (net of any known liabilities) as of the Closing Date).
4. DELIVERY OF SELLER ESTOPPEL CERTIFICATES. In connection with
the consummation of the transactions contemplated by the Purchase
Agreement, Seller has agreed to deliver to Buyer at Closing certain
estoppel certificates of Seller in the form of the estoppel certificates
set forth on Exhibit "A" attached hereto (the "SELLER ESTOPPEL
CERTIFICATES") for each of the tenants of the Property listed on Schedule
"1" attached hereto (the "SELLER ESTOPPEL TENANTS"). In the event that
Seller delivers to Buyer, or in the event that Buyer or its successors,
assigns or lenders receives, a tenant Estoppel Certificate with respect to
a Seller Estoppel Tenant which confirms the information provided in the
Seller Estoppel Certificate with respect to the Tenant Lease for such
Seller Estoppel Tenant (or which Tenant Estoppel Certificate otherwise
meets the Minimum Estoppel Standards), Seller shall not have any liability
with the respect to such Seller Estoppel Certificate previously delivered
to Buyer with respect to such Tenant Lease. Subject to the foregoing
provisions regarding the release of Seller from liability, Buyer hereby
acknowledges and agrees that Seller shall not have any liability to Buyer
or its successors, assigns or lenders after July 31, 2000 with respect to a
Seller Estoppel Certificate delivered to Buyer hereunder except with
respect to claims made on or prior to such date in accordance with the
terms and conditions of the Purchase Agreement.
5. DELIVERY OF HOUSTON'S LETTER OF CREDIT. Pursuant to the terms
of that certain Lease Agreement dated November 20, 1995, by and between
Seller and Houston's Restaurant's Inc. ("HOUSTON"), which Lease Agreement
was amended by that certain Lease Amendment dated April 17, 1997 (as
amended, the "HOUSTON'S LEASE"), Houston's delivered an Irrevocable Standby
Letter of Credit (the "LETTER OF CREDIT"), a copy of which is attached
hereto as Exhibit "B", to Urban Retail Properties Co. ("URBAN RETAIL"), as
security for the payment of the purchase price of that certain Plenary
Retail Consumption License Number 0223-33-049-004 issued by the City of
Hackensack, New Jersey (the "HOUSTON'S LIQUOR LICENSE"). Seller has
obtained the original Letter of Credit and has delivered the Letter of
Credit to Escrow Holder. However, as a condition to issuing an amendment
to the Letter of Credit naming Buyer as the beneficiary thereof,
NationsBank, N.A., the issuer of the Letter of Credit, is requiring that
Urban retail execute, have authenticated by Urban Retail's bank and deliver
to NationsBank Form H-4 ("Form H-4"), a copy of which is attached hereto as
Exhibit "C". In this connection, upon the consummation of the transactions
contemplated by the Purchase Agreement, Seller agrees to authorize Escrow
Holder to deliver the Letter of Credit to Buyer and then promptly cause
Urban Retail to deliver to Buyer (a) an executed original Assignment and
Assumption of Irrevocable Standby Letter of Credit in the form of Exhibit
"D" attached hereto (the "Assignment and Assumption of Letter of Credit"),
and (b) an executed and authenticated original form H-4. Seller's
obligations here under with respect to the Houston's Letter of Credit shall
terminate and expire upon Urban Retail's delivery of the assignment and
Assumption of Letter of Credit and Form H-4 to Buyer, provided that Seller
shall reasonably cooperate with Buyer to satisfy any other reasonable
requirements of NationsBank in connection with such transfer.
6. SALE OF RIDGEPOST LIQUOR LICENSE. Ridgepost, Inc., A new
Jersey corporation ("Ridgepost") is the owner of that certain Plenary
Retail Consumption License Number 0223-33-053-008 issued by the City of
Hackensack, New Jersey and held by the City Clerk's office of the City of
Hackensack, New Jersey (the "RIDGEPOST LIQUOR LICENSE"). Concurrently with
the consummation of the transactions contemplated by the Purchase
Agreement, Seller shall cause Ridgepost to sell to Buyer or its designee,
and Buyer shall or cause its designee to purchase from Ridgepost, the
Ridgepost Liquor License. The purchase price for the Ridgepost Liquor
License shall be the sum of Twenty Five Thousand Dollars ($25,000). The
purchase price for the Ridgepost Liquor License shall be paid to Ridgepost
by Buyer by Buyer providing Seller with a proration credit at Closing in an
amount equal to the purchase price for the Ridgepost Liquor License. The
sale of the Ridgepost Liquor License hereunder is and will be made on an
"as is" basis, without representations and warranties of any kind or
nature, express, implied or otherwise. In this connection, Buyer
acknowledges that in order to transfer the Ridgepost Liquor license to
Buyer, Buyer will be required to file a Retail Liquor License Application
(the "LICENSE APPLICATION") with the State of New Jersey Department of Law
and Public Safety Division of Alcohol Beverage Control (the "ABC") and that
the ABC might deny the License Application or otherwise fail to approve the
transfer of the Ridgepost Liquor License from Ridgepost to Buyer. In the
event that Buyer fails to obtain the approval of the ABC (or any other
required governmental entities) with respect to the transfer of the
Ridgepost Liquor License from Ridgepost to Buyer or its designee, Seller
shall have no liability hereunder and Seller shall not be required to
refund or otherwise return the purchase price for the Ridgepost Liquor
License to Buyer: Seller's sole obligation hereunder being to use
reasonable efforts to cooperate with Buyer or its designee in connection
with Buyer's filing of the License Application (and if requested by Buyer,
Seller shall file, at Buyer's sole cost and expense, such documents and
papers as are necessary to extend the Ridgepost Liquor License beyond its
current expiration, but Seller shall have no liability hereunder if such
extension is not obtained) and, to the extent that the ABC approves the
transfer of the Ridgepost Liquor License from Ridgepost to Buyer, causing
Ridgepost to execute and deliver any and all documents reasonably required
by the applicable governmental authorities to effectuate such transfer:
provided, however, that neither Seller nor Ridgepost shall be obligated to
incur any costs or expenses (or pay any filing fees or other fees of any
kind) in connection with the filing of Buyer's License Application or the
transfer the Ridgepost Liquor License from Ridgepost to Buyer (and Buyer
hereby agrees to indemnify and hold each of Seller and Ridgepost harmless
in connection with the filing of Buyer's License Application and the
transfer the Ridgepost Liquor License from Ridgepost to Buyer).
7. RATIFICATION OF PURCHASE AGREEMENT. Except as set forth in
this letter agreement, the provisions of the Purchase Agreement shall be,
and shall remain, in full force and effect. Accordingly, the covenants,
agreements, and limitations (including, but not limited to, the limitations
of liability provided in paragraphs 7.C and 9.B of the Purchase Agreement,
as modified hereby) provided in the Purchase Agreement are hereby
incorporated herein by this reference as if herein set out in full and
shall inure to the benefit of and shall be binding upon Seller and Buyer,
and there respective successors and assigns.
8. COUNTERPARTS. This letter agreement may be executed in any
number of counterparts, provided each of the parties hereto executes at
least one counterpart: each such counterpart hereof shall be deemed to be
an original instrument, but all such counterparts, together, shall
constitute but one letter agreement. This letter agreement may be executed
in facsimile form (and shall be promptly followed by a hard copy
counterpart original).
9. SUCCESSORS AND ASSIGNS. This Agreement and the terms and
provisions hereof shall inure to the benefit of and be binding upon the
successors and assigns of the parties.
IN WITNESS WHEREOF, the parties have executed this Agreement as of
the day and year first above written.
SELLER:
------
JMB INCOME PROPERTIES, LTD. - XI,
an Illinois limited partnership
By: JMB Realty Corporation,
a Delaware corporation,
General Partner
By: /s/ Xxxxxx Xxxxx Xxxxxxx
----------------------------------------
Name: Xxxxxx Xxxxx Xxxxxxx
----------------------------------------
Title: Senior Vice President
----------------------------------------
BUYER:
-----
RIVERSIDE 062 PARTNERS, L.P.,
a Delaware limited partnership
By: SHOPCO 062 LLC
a Delaware limited liability company
Its: General Partner
By: RSM 062 Corp.,
a Delaware corporation
Its Managing Member
By: /s/ Xxx Xxxxxx
------------------------------
Name: Xxx Xxxxxx
------------------------------
Title: Chairman
------------------------------
RIDGEPOST, INC. CONSENT
-----------------------
The undersigned hereby executes this letter agreement to evidence its
consent to Seller's execution and delivery of this letter agreement.
Dated as of August 5, 1999.
RIDGEPOST, INC.,
a New Jersey corporation
By: /s/ Xxxxxxxxx X. Xxxxxx
------------------------------
Name: Xxxxxxxxx X. Xxxxxx
------------------------------
Title: President
------------------------------
