-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, CJ7xn6CW68NYROvAEyK0CNAsebnokYMR/C1HvUlSMQuBWl1bOR0jtovF8E98vaQq Zs2wN8xWucEA+sD2pkRCJQ== 0000810116-96-000001.txt : 19960402 0000810116-96-000001.hdr.sgml : 19960402 ACCESSION NUMBER: 0000810116-96-000001 CONFORMED SUBMISSION TYPE: 10-K PUBLIC DOCUMENT COUNT: 4 CONFORMED PERIOD OF REPORT: 19951231 FILED AS OF DATE: 19960401 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: DEAN WITTER REALTY YIELD PLUS L P CENTRAL INDEX KEY: 0000810116 STANDARD INDUSTRIAL CLASSIFICATION: REAL ESTATE [6500] IRS NUMBER: 133426531 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-18148 FILM NUMBER: 96542845 BUSINESS ADDRESS: STREET 1: TWO WORLD TRADE CTR STREET 2: 46TH FLOOR CITY: NEW YORK STATE: NY ZIP: 10048 BUSINESS PHONE: 2123921054 MAIL ADDRESS: STREET 1: TWO WORLD TRADE CENTER STREET 2: 46TH FLORR CITY: NEW YORK STATE: NY ZIP: 10048 10-K 1 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K [ X ] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 1995 OR [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ________ to ________. Commission File Number 0-18148 DEAN WITTER REALTY YIELD PLUS, L.P. (Exact name of registrant as specified in governing instrument) Delaware 13-3426531 (State of organization) (IRS Employer Identification No.) 2 World Trade Center, New York, NY 10048 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (212) 392-1054 Securities registered pursuant to Section 12(b) of the Act: Title of each class Name of each exchange on which registered None None Securities registered pursuant to Section 12(g) of the Act: Units of Limited Partnership Interest (Title of Class) Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes X No Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. [ X ] State the aggregate market value of the voting stock held by nonaffiliates of the registrant. Not Applicable DOCUMENTS INCORPORATED BY REFERENCE None PART I. ITEM 1.BUSINESS. The Registrant, Dean Witter Realty Yield Plus, L.P. (the "Partnership"), is a limited partnership organized in January 1987 under the Uniform Limited Partnership Act of the State of Delaware for the purpose of investing in income-producing commercial, residential and industrial properties. The Managing General Partner of the Partnership is Dean Witter Realty Yield Plus Inc. (the "Managing General Partner"), a Delaware corporation which is wholly-owned by Dean Witter Realty Inc. ("Realty"). The Associate General Partner is Dean Witter Realty Yield Plus Associates, L.P. (the "Associate General Partner"), a Delaware limited partnership, the general partner of which is the Managing General Partner. The Managing General Partner manages and controls all aspects of the business of the Partnership. The terms of transactions between the Partnership and its affiliates are set forth in the consolidated financial statements in Item 8 and in Item 13 below. The Partnership issued 8,909,969 units of limited partnership interests (the "Units") for $178,199,380. The offering has been terminated and no additional Units will be sold. The proceeds from the offering were used to make investments in six participating mortgage loans and land leases secured by interests in two retail properties, two office buildings, one residential property, and an office and parking garage complex. Additionally, proceeds were used to make an investment in a short-term loan secured by eleven partnership interests. The Partnership subsequently acquired the real estate securing all but one of the foregoing loans through foreclosure or through transfers of ownership in lieu of foreclosure and sold three properties. The Partnership's properties and investment in participating mortgage loan are described in Item 2 below. The Partnership considers its business to include one industry segment, investment in real property. Financial information regarding the Partnership is in the Partnership's financial statements in Item 8 below. The Partnership's real property investments are subject to competition from similar types of properties in the vicinities in which they are located. Further information regarding competition and market conditions where the Partnership's properties are located is set forth in Item 7. "Management's Discussion and Analysis of Financial Condition and Results of Operations". The Partnership has no employees. All of the Partnership's business is conducted in the United States. ITEM 2. PROPERTIES. The Partnership's principal offices are located at Two World Trade Center, New York, New York 10048. The Partnership has no other offices. The Partnership owns directly or through a partnership interest the following interests in real estate and real estate loan. Generally, the leases pertaining to the properties provide for pass-throughs to the tenants of their pro-rata share of certain operating expenses. In the opinion of the Managing General Partner, all of the properties are adequately covered by insurance.
Date of Initial Net Rentable Completion/ Investment2 Area Ownership of Property, location and type Acquisition1 ($000) (000 sq. ft.) Land & Improvements Greenway Pointe3 1988/1990 $8,315 120 99.99% general part- Columbia, MD nership interest.4 3 office/R&D buildings 401 East Ontario Street 1990/1992 $37,000 395 apts 100% through interests Chicago, IL in general partner- luxury residential ships and corpora- building tions. 2600 Michelson Drive 1986-89/1990 $36,000 390 50.81% general part- Irvine, Ca nership interest.5 3 office buildings Deptford Crossing3 1991/1992 $18,291 200 100% through interests Deptford, NJ in general partner- shopping center ships and corporations. Genessee Crossing3 1988/1994 $8,640 309 100% through interests Flint, MI in general partnerships shopping center and corporations. Pine Ridge N/A/1994 $138 2.8 acres 100% through a limited Flint, MI partnership and corp- unimproved land orations. Military Crossing N/A/1994 $300 .6 acres 100% through interests Norfolk, VA in general partnerships land and corporations. One Congress Street 1990,91/1989 $34,350 office-246 58% of a permanent Boston, MA retail-37 second mortgage office building and loan. garage Farmington Crossroads7 1985/1994 $4,022 84 50% through interests Farmington Hills, MI in general partnerships shopping center and corporations.6 Hampton Village Centre7 1988-1993/1993 $42,798 450 100% through interests Rochester Hills, MI in general partner- shopping center ships and corporations. Midway Crossing7 1987/1994 $8,919 134 100% through interests Elyria, OH in general partnerships shopping center and corporations. 1. Acquisition date is date of foreclosure or in-substance foreclosure. 2. Estimated fair value on foreclosure or in-substance foreclosure date, or loan amount. 3. Property is subject to a mortgage loan. See note 7 to the consolidated financial statements in Item 8. 4. The Managing General Partner owns the remaining .01% general partnership interest in the partnership. 5. Dean Witter Realty Yield Plus II, L.P., an affiliate of the Partnership owns the remaining 49.19% general partnership interest. The total cost of the property was approximately $71 million. 6. The remaining 50% interest was owned by a principal of the developer of the property. 7. Property sold in December 1995. See Note 5 to the consolidated financial statements in Item 8.
Each property has been built with on-site parking facilities. An affiliate of Realty is the property manager for Greenway Pointe, 2600 Michelson Drive and Deptford Crossing. Further information relating to the Partnership's properties is included in Item 7 and footnotes 4, 5 and 6 to the consolidated financial statements in Item 8 below. ITEM 3. LEGAL PROCEEDINGS. On December 27, 1995, a class action lawsuit (the "Grigsby Action") naming various public real estate partnerships sponsored by Realty (including the Partnership and its Managing General Partner and Associate General Partner), Realty, Dean Witter Reynolds Inc. and others as defendants was filed in Superior Court in California. The complaint alleges fraud, negligent misrepresentation, intentional and negligent breach of fiduciary duty, unjust enrichment and related claims and seeks compensatory and punitive damages in unspecified amounts and injunctive and other equitable relief. The defendants have removed the case to the United States District Court for the Southern District of California. The parties have signed a stipulation requesting that the action be transferred to the United States District Court for the Southern District of New York. The defendants have not yet responded to the complaint and intend to vigorously defend the action. On February 14, 1996, a class action lawsuit (the "Schectman Action") naming various public real estate partnerships sponsored by Realty (including the Partnership and its Managing General Partner), Realty, Dean Witter Discover & Co., and Dean Witter Reynolds Inc. as defendants was filed in the Chancery Court of Delaware for New Castle County. The complaint alleges reckless and/or negligent misrepresentation and nondisclosure, breach of fiduciary duty and related claims and seeks an accounting of profits and rescissory and/or compensatory damages in unspecified amounts. The defendants have not yet responded to the complaint and intend to vigorously defend the action. On February 23, 1996, a class action lawsuit (the "Dosky Action") naming various public real estate partnerships sponsored by Realty (including the Partnership and its Managing General Partner), Realty, Dean Witter Discover & Co., Dean Witter Reynolds Inc. and others as defendants was filed in the Chancery Court of Delaware for New Castle County. The complaint alleges breach of fiduciary duty and seeks an accounting of profits, compensatory damages in unspecified amounts, possible liquidation of the Partnership under a receiver's supervision and other equitable relief. The defendants have not yet responded to the complaint and intend to vigorously defend the action. On February 29, 1996, a class action lawsuit (the "Segel Action") naming various public real estate partnerships sponsored by Realty (including the Partnership and its Managing General Partner), Realty, Dean Witter Reynolds Inc., Dean Witter Discover & Co. and others as defendants was filed in the Chancery Court of Delaware for New Castle County. The complaint alleges breach of fiduciary duty and seeks an accounting of profits, compensatory damages in unspecified amounts, possible liquidation of the Partnership under a receiver's supervision and other equitable relief. The defendants have not yet responded to the complaint and intend to vigorously defend the action. ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS. No matter was submitted during the fourth quarter of the fiscal year to a vote of Unit holders. PART II. ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS. An established public trading market for the Units does not exist, and it is not anticipated that such a market will develop in the future. Accordingly, information as to the market value of a Unit at any given date is not available. However, the Partnership does allow limited partners (the "Limited Partners") to transfer their Units, if a suitable buyer can be located. As of March 18, 1996, there were 17,459 holders of limited partnership interests. The Partnership is a limited partnership and, accordingly, does not pay dividends. It does, however, make quarterly distributions of cash to its partners. Pursuant to the Partnership Agreement, distributable cash, as defined, is paid 90% to the Limited Partners and 10% to the general partners (the "General Partners"). Pursuant to the agreement, $1,239,345 of the General Partner's share of such net cash flow distributable to them through December 31, 1990, was deferred subject to receipt by the Limited Partners of an 8% annual return on their invested capital through that date. During each of the years ended December 31, 1995 and 1994, the Partnership paid quarterly cash distributions aggregating $.60 per Unit to Limited Partners. The total distributions each year amounted to $5,939,976, with $5,345,980 distributed to the Limited Partners and $593,996 distributed to the General Partners. In January 1996, the Partnership paid a cash distribution of $0.15 per Unit to Limited Partners. The distribution was $1,484,994 with $1,336,495 distributed to Limited Partners and $148,499 distributed to the General Partners. The Partnership also paid a distribution in January 1996 of the net proceeds from the sale of the shopping centers. All of the net proceeds of $6,412,164 ($.72 per Unit) were distributed to the Limited Partners; the General Partner deferred receipt of any proceeds, as permitted by the Partnership agreement. The Partnership anticipates making regular distributions to its partners in the future. Sale or financing proceeds will be distributed, to the extent available: first, 97% to the Limited Partners and 3% to the General Partners until each Limited Partner has received a return of their invested capital plus an amount sufficient to provide a 10% cumulative annual return thereon; second, 100% to the General Partners until they have received the amount of any net cash flow previously deferred and not distributed; and third, 85% to the Limited Partners and 15% to the General Partners. During the years ended December 31, 1995 and 1994, the Partnership did not distribute any sale or financing proceeds. Taxable income (subject to certain adjustments) will be allocated to the partners in proportion to the distribution of distributable cash or sale or financing proceeds, as the case may be (or 90% to the Limited Partners and 10% to the General Partners if there is no distributable cash or sale or financing proceeds). Tax losses, if any, will be allocated 90% to the Limited Partners and 10% to the General Partners.
ITEM 6. SELECTED FINANCIAL DATA. The following sets forth a summary of selected financial data for the Partnership: DEAN WITTER REALTY YIELD PLUS, L.P. For the years ended December 31, 1995, 1994, 1993, 1992 and 1991 19951 1994 1993 1992 1991 Total revenues $ 34,399,506 $ 29,051,935 $ 21,141,666$ 14,170,837 $ 17,485,712 Income (loss) before 2 3 extraordinary item$ 1,343,582 $ 4,024,646 $(7,155,221)2$(30,160,877)$ 8,364,953 Extraordinary item $ - $ 626,375 $ - $ - $ - 1 2 3 Net income (loss) $ 1,343,582 $ 4,651,021 $(7,155,221)2$(30,160,877)$ 8,364,953 Per Unit of limited partnership interest: Income (loss) before extraordinary item $.17 $.41 $(.72) $(3.05) $ .84 Extraordinary item $ - $.06 - - - Net income (loss) $.17 $.47 $(.72) $(3.05) $ .84 Cash distribution paid per Unit of limited partnership interest4 $.60 $.60 $.60 $.97 $1.20 Total assets at December 31 $141,753,976 $195,810,917 $175,847,369$139,074,207 $192,070,715 Long term debt due after one year $ 19,823,736 $ 66,887,850 $ 45,554,079 $ - $ - 1. Revenues and income include a $3.3 million gain on sale of real estate and income is net of a $6.9 million loss on impairment of real estate. See Item 7 and Note 5 to the consolidated financial statements in Item 8. 2. Includes a $12.9 million impairment loss in 1993 on the mortgage loan at One Congress Street, and a $1.7 million impairment loss in 1994 relating to the same loan. 3. Includes losses of $16.3 million on impairment of real estate and a $15.6 million writedown of loan and reclassification to real estate upon in-substance foreclosure of real estate. 4. Distributions paid to limited partners include a return of capital per Unit of limited partnership interest of $0.43, $0.13, $0.60, $0.97 and $0.36 for the years ended December 31, 1995, 1994, 1993, 1992 and 1991, respectively, calculated as the excess of cash distributed per Unit over accumulated earnings per Unit not previously distributed. The above financial data should be read in conjunction with the consolidated financial statements. /TABLE ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS. Liquidity and Capital Resources The Partnership raised $178,199,380 through a public offering which terminated in 1987. The Partnership has no plans to raise additional capital. The Partnership originally committed the proceeds raised in the offering to seven investments in loans or land leases, which provided for a fixed current return and participation in the long-term appreciation and/or revenue from operation of the properties involved in such investments. Due to weaknesses in real estate markets, most of the properties did not generate sufficient cash flow to fully service their debt. As a result, prior to December 31, 1994, the Partnership acquired, through foreclosure, or through transfers of ownership interests in lieu of foreclosure, all but one of the properties in which it originally invested. The resulting foreclosures have effectively changed the Partnership from a participating lender to an equity owner of real estate. As a result, the Partnership receives all cash flow from the properties it owns, and will be required to expend funds for tenant improvements and leasing commissions in connection with the leasing of vacant space as is customary in most real estate markets. See note 4 to the consolidated financial statements in Item 8. Many real estate markets are stabilizing or improving primarily due to the continued absence of significant construction activity. The relative absence of office construction as well as growth in business services has resulted in absorption of office space in cities such as Boston, the location of One Congress Street. In contrast, office vacancy levels in southern California (the location of 2600 Michelson Drive) remain essentially unchanged from the prior year as certain large corporations and financial companies continued to restructure and consolidate their operations. In most markets, office construction is limited to build-to-suit projects. Office/research and development properties in certain regions are benefiting from growth in the computer, communications and electronics industries. At retail properties, the demand for space for the first half of 1995 was subdued as result of generally sluggish retail sales and competition from large power centers, discounters and reorganized department stores. Continued tenant demand for units at many residential properties has resulted in stable occupancies and rent growth during 1995. The Partnership's liquidity depends upon the cash flow from operations of its real estate investments, interest on its participating mortgage loan and expenditures for tenant improvements and leasing commissions in connection with the leasing of space. In 1995, all of the Partnership's properties generated positive cash flow from operations, and it is anticipated that they will continue to do so. In addition, the Partnership's liquidity will be affected by the sale of the Partnership's properties. In accordance with the provisions of the Partnership Agreement, the net sales proceeds from the sale by the Partnership of three shopping centers of $6.4 million ($.72 per Unit) was distributed to the Limited Partners in January 1996, representing a return of invested capital. Because the Partnership has fewer income producing investments, the Partnership's cash from operations available for distribution will decline in 1996 and thereafter. In the fourth quarter of 1995, the partnership sold the Farmington Crossroads, Hampton Village Centre and Midway Crossing shopping centers for approximately $58.3 million (see Note 5 to the consolidated financial statements). Proceeds of approximately $48.7 million were used to pay closing costs, repay mortgage loans and repay the loan from an affiliate of Realty. After reserves relating to the 401 East Ontario Street property (see Note 4 to the consolidated financial statements), the Partnership distributed approximately $6.4 million ($.72 per Unit) to Limited Partners in January 1996. Aggregate net income and cash flow in 1995 of the properties sold approximated $1.9 million and $2.6 million, respectively. In December 1995, the Partnership refinanced the mortgage loan payable on the Deptford Crossing shopping center and paid down $4.5 million of principal from its cash reserves. See Note 7 to the consolidated statements. In 1995, the Partnership incurred approximately $505,000 primarily for lease-related capital expenditures at 2600 Michelson Drive, and approximately $236,000 primarily relating to the retail space at 401 East Ontario Street. In addition, the Partnership expended approximately $1.5 million in connection with the repairs at 401 East Ontario Street (see Note 4 to the consolidated financial statements), and funded its remaining $300,000 loan commitment to One Congress Street As of December 31, 1995, the Partnership has commitments to contribute approximately $1 million to DW Michelson Associates, primarily for lease-related capital expenditures, and expects to expend approximately $6 million to complete the repairs at 401 East Ontario Street. These expenditures are expected to be funded from cash reserves. The Partnership's participating mortgage loan is secured by the One Congress Street property. The General Services Administration ("GSA"), which leases all of the office space at the property, had a one-time option to cancel all or a portion of its lease at any time prior to its lease expiration in August 1997. In March 1996, GSA notified the owner/borrower of the One Congress Street property that it will vacate approximately 67,500 Square feet (approximately 28%) of the office space at the property in June 1996. The borrower continues discussions with the GSA regarding renewal of its remaining space at the property as well as the pending claim against the GSA relating to the original construction of its space. If the owner/borrower can not re-lease the space which GSA will vacate, property cash flow will be reduced, and the owner/borrower of the property may not be able to meet its minimum debt service obligation. Except as discussed above and in the consolidated financial statements, the Managing General Partner is not aware of any trends or events, commitments or uncertainties that will have a material impact on liquidity. In January 1996, in addition to the distribution of the sale proceeds described above, the Partnership paid the fourth quarter cash distribution of $.15 per unit to Limited Partners. The total cash distribution was $1,484,994 with $1,336,495 distributed to Limited Partners and $148,499 distributed to the General Partner. Operations Fluctuations in the Partnership's operating results for the year ended December 31, 1995 compared to 1994 and for 1994 compared to 1993 are primarily attributable to the following: The increase in rental income in 1995 compared to 1994 was approximately $2.1 million. The increase resulted from higher rental income of approximately $1.5 million at the Midway Crossing, Genessee Crossing and Farmington Crossroads shopping centers, which began to be included in operations in 1994 (collectively, the "1994 Shopping Centers"). The remaining increase resulted from higher rental revenue associated with higher occupancy at Greenway Pointe, 2600 Michelson Drive and 401 East Ontario Street partially offset by the loss of one month of rental income at Hampton Village Centre due to its sale. The increase in rental income in 1994 compared to 1993 was approximately $7.4 million. The increase resulting from the inclusion of the operations of the 1994 Shopping Centers and the Hickory Ridge shopping center was approximately $2.8 million, and the increase caused by the inclusion of a full year of operations of the Deptford and Hampton properties was approximately $5.7 million. The remaining difference, a decrease of approximately $1.1 million, was caused by lower rental income from the Michelson and Greenway Pointe properties, partially offset by higher rental income from 401 East Ontario Street. The increase in property operating expenses in 1995 compared to 1994 primarily results from the costs of repair work at 401 East Ontario Street, offset by lower operating expenses at 2600 Michelson Drive as a result of a significant refund of prior year real estate taxes. The increase in property operating expense in 1994 compared to 1993 was approximately $3.4 million. The increase resulting from the inclusion of the operations of the 1994 Shopping Centers and Hickory Ridge shopping center was approximately $1.2 million, and the increase caused by inclusion of the first full year of operations of the Deptford and Hampton properties was approximately $1.7 million. The remaining increase was primarily caused by higher operating costs at 401 East Ontario Street. The increase in interest income from the participating mortgage loan in 1995 compared to 1994 resulted from the higher loan balance outstanding during 1995. The decrease in 1994 compared to 1993 primarily resulted from the reclassification of Hampton Village Centre to real estate effective in September 1993. The increase in interest on short term investments in 1995 compared to 1994 was primarily a result of higher interest rates and amounts invested in 1995. The increase in interest on short-term investments in 1994 compared to 1993 is attributable to higher interest rates in 1994. The decrease in other income in 1995 compared to 1994 is due to the absence of cash received in 1994 from the partnerships which owned four community shopping centers that were foreclosed upon by their respective first mortgage lenders, and cash received from the developer of 401 East Ontario Street in exchange for the Partnership releasing it of any continuing liability under the deficit guaranty, offset by a lease termination fee received at Michelson in 1995. The increase in other income in 1994 compared to 1993 primarily represents the cash received from the foreclosed shopping centers and the release from the developer at 401 East Ontario as noted above. The increase in interest expense for 1995 compared to 1994 primarily resulted from the inclusion in 1995 of a full year's interest on the mortgage loans on the 1994 Shopping Centers which were acquired in April 1994. The increase in interest expense in 1994 when compared to 1993 represent interest on the Hampton Village Centre, Deptford Crossing and 1994 Shopping Centers first mortgage loans which the Partnership began to record when it obtained ownership of these properties. The decrease in general and administrative expense in 1995 compared to 1994 resulted from the absence of legal costs incurred in connection with the foreclosures of the 1994 Shopping Centers. General and administrative expenses were higher in 1993 compared to 1994 because of significant legal fees incurred in connection with foreclosures and restructurings in 1993. Losses on impairments of real estate and investments in participating mortgage loans and other secured loans consisted of the provisions for losses on Deptford Crossing in 1995 and One Congress Street in 1994 and 1993. See Notes 4 and 6 to the consolidated financial statements in Item 8. The increase in the minority interest share of income in 1995 compared to 1994 is due to higher income from 2600 Michelson Drive and lower property operating expenses as described above. The decreases in minority interests in 1994 compared to 1993 primarily resulted from lower rents in 1994 as compared to 1993 at 2600 Michelson Drive. A summary of the office, retail, residential and research and development building markets where the Partnership's properties are located, and the performance of each property is as follows: The current vacancy rate in the Columbia, Maryland research and development market, the location of Greenway Pointe, is 13%; this market suffers from an oversupply of buildings which will take several years to work off. However, at December 31, 1995, occupancy at the property increased to 100%. The lease of G Tech, which occupies approximately 20% of the property's space, expires in September 1996; it is unlikely that this tenant will renew its space. This center is leased to 11 tenants. Major tenants include G Tech, Energetics, Caremark and LGIT. The 401 East Ontario property is located in a strong luxury residential submarket in the central business district of Chicago, Illinois. There is currently no new luxury high rise construction in this submarket, and other competing properties are in the process of converting to condominium ownership. At December 31, 1995, new and existing residents have continued to pay rental increases and the property is 93% occupied. The current occupancy is slightly below market; this may be caused by construction activity described in Note 4 to the consolidated financial statements. It is not known at this time the effect, if any, the repair program will have on rents and occupancy in the near future. Favorable lease rates are attracting tenants to the office market in Irvine, California, the location of 2600 Michelson Drive, where the market vacancy rate is approximately 15%. The steady absorption of space and the lack of new construction are leading to a tightening of available quality office space in this sub-market. During 1995, average occupancy at the property was 87%, and at December 31, 1995,the property was 92% leased to 41 tenants. The lease of AVCO Financial expires in 2002. Approximately 9% of the leased space is up for renewal in 1996. Deptford, New Jersey, the location of Deptford Crossing, has a high vacancy rate which has exerted downward pressure on rents and has made further leasing difficult. During 1995, occupancy at the property decreased from 82% to 80%. No significant leases are scheduled to expire before 1997. The center is leased to 14 tenants. Major tenants include TJ MAXX, Marshalls, Office Warehouse & Petstuff. Because of continuing weakness in the Deptford, New Jersey retail market, and the likelihood that such weakness would persist for several years, in the third quarter of 1995, the Partnership concluded that there was a decline in the value of the Deptford Crossing shopping center and that the decline was other- than-temporary. Accordingly, the Partnership recorded a loss on impairment of the property of approximately $6,931,000 at September 30, 1995. The vacancy level in the Boston office market, the location of One Congress Street, is approximately 10%, a decrease from approximately 12% at the beginning of the year. However, recent leasing activity has slowed from the 1994 pace and consolidations of banks with major office leases in Boston may add additional space to the market. The property may be affected by this because GSA has announced it will vacate 67,500 square feet of the property's space in June 1996 and its lease on the remaining space terminates in August 1997. Also, the retail space has been difficult to lease. During 1995, occupancy at the office and garage space remained at 100% and the retail space, which is not a significant portion of the overall space, is substantially vacant. Flint, Michigan, the location of the Genessee Crossing shopping center, is an active retail market with a relatively low vacancy rate. During 1995, occupancy at the property remained at 99%. No significant leases are scheduled to expire in the near future. Builder's Square, which owns an 80,000 square foot store at the center, has announced it will leave its building at the end of the year and move into a bigger location in the area. Builder's Square has leased the space to two new tenants which are home entertainment and electronics retailers. The Partnership believes that the new retailers will increase traffic at the property. This center is leased to 11 tenants. Major tenants include Joann Fabrics, Fashion Bug and Burlington Coat Factory. Inflation Inflation has been consistently low during the periods presented in the financial statements and, as a result, has not had a significant effect on the operations of the Partnership or its properties.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA. DEAN WITTER REALTY YIELD PLUS, L.P. INDEX (a) Financial statements Page Independent Auditors' Report - 1995-1994 16 Independent Auditors' Report 1993 17 Consolidated Balance Sheets at December 31, 1995 and 1994 18 Consolidated Statements of Operations for the years ended December 31, 1995, 1994 and 1993 19 Consolidated Statements of Changes in Partners' Capital for the years ended December 31, 1995, 1994 and 1993 20 Consolidated Statements of Cash Flows for the years ended December 31, 1995, 1994 and 1993 21-22 Notes to Consolidated Financial Statements 23-35 (b) Financial statement schedule Real Estate and Accumulated Depreciation III 42-46 All schedules other than those indicated above have been omitted because either the required information is not applicable or the information is shown in the consolidated financial statements or notes thereto. /TABLE Independent Auditors' Report The Partners Dean Witter Realty Yield Plus, L.P.: We have audited the accompanying consolidated balance sheets of Dean Witter Realty Yield Plus, L.P. and consolidated partnerships (the "Partnership") as of December 31, 1995 and 1994, and the related consolidated statements of operations, partners' capital (deficiency) and cash flows for the years then ended. Our audits also included financial statement schedule III. These financial statements and the financial statement schedule are the responsibility of the Partnership's management. Our responsibility is to express an opinion on there financial statements and the financial statement schedule based on our audits. We conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, such consolidated financial statements present fairly, in all material respects, the financial position of Dean Witter Realty Yield Plus, L.P. and consolidated partnerships as of December 31, 1994 and 1994, and the results of their operations and their cash flows for the years then ended in conformity with generally accepted accounting principles. Also, in our opinion, financial statement schedule III, when considered in relation to the basic consolidated financial statements taken as a whole, presents fairly, in all material respects, the information set forth therein. Deloitte & Touche LLP /s/Deloitte & Touche LLP New York, New York March 29, 1996 Independent Auditors' Report The Partners Dean Witter Realty Yield Plus, L.P. We have audited the accompanying consolidated statements of operations, changes in partners' capital (deficiency) and cash flows of Dean Witter Realty Yield Plus, L.P. and consolidated partnerships for the year ended December 31, 1993. These consolidated financial statements are the responsibility of the Partnership's management. Our responsibility is to express an opinion on these consolidated financial statements based on our audit. We conducted our audit in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the results of operations and cash flows of Dean Witter Realty Yield Plus, L.P. and consolidated partnerships for the year ended December 31, 1993, in conformity with generally accepted accounting principles. KPMG Peat Marwick LLP New York, New York March 25, 1994
DEAN WITTER REALTY YIELD PLUS, L.P. CONSOLIDATED BALANCE SHEETS December 31, 1995 and 1994 ASSETS 1995 1994 Real estate, at cost: Land $ 13,444,875 $ 31,695,941 Buildings and improvements 99,540,590 142,956,910 112,985,465 174,652,851 Accumulated depreciation 14,468,727 12,098,192 98,516,738 162,554,659 Investment in participating mortgage loan, net of allowance of $14,570,278 19,974,382 19,584,348 Cash and cash equivalents 18,939,265 4,772,726 Deferred expenses, net 1,626,335 1,488,502 Other assets 2,697,256 2,410,682 Cash in escrow - 5,000,000 $141,753,976 $195,810,917 LIABILITIES AND PARTNERS' CAPITAL Mortgage notes payable $ 20,003,736 $ 57,714,877 Accounts payable and other liabilities 4,249,284 4,615,541 Minority interests 19,566,955 19,873,023 Loan from affiliate - 1,726,524 Loans payable to bank - 9,350,557 43,819,975 93,280,522 Partners' capital (deficiency): General partners (6,407,938) (5,614,897) Limited partners ($20 per Unit, 8,909,969 issued and outstanding) 104,341,939 108,145,292 Total partners' capital 97,934,001 102,530,395 $141,753,976 $195,810,917 See accompanying notes to consolidated financial statements. /TABLE
DEAN WITTER REALTY YIELD PLUS, L.P. CONSOLIDATED STATEMENTS OF OPERATIONS Years ended December 31, 1995, 1994 and 1993 1995 1994 1993 Revenues: Rental $27,033,215 $24,937,731 $ 17,554,056 Interest on participating mortgage loans 2,745,433 2,588,341 3,013,236 Gain on sale of real estate 3,334,036 - - Interest on short-term investments 496,283 369,191 292,974 Other 790,539 1,156,672 281,400 34,399,506 29,051,935 21,141,666 Expenses: Property operating 12,942,778 11,601,150 8,101,873 Interest 5,794,644 5,280,383 1,497,011 Depreciation 4,342,062 4,144,709 2,826,887 Amortization 547,318 410,772 234,645 General and administrative 786,283 1,129,135 1,405,769 Losses on impairment of real estate, and participating mortgage loan 6,931,459 1,711,683 12,858,595 31,344,544 24,277,832 26,924,780 Income (loss) before minority interests 3,054,962 4,774,103 (5,783,114) Minority interests 1,711,380 749,457 1,372,107 Income (loss) before extraordinary item 1,343,582 4,024,646 (7,155,221) Extraordinary item: Gain on refinancing of debt - 626,375 - Net income (loss) $ 1,343,582 $ 4,651,021 $ (7,155,221) Net income (loss) allocated to: Limited partners $ 1,542,627 $ 4,185,919 $ (6,439,699) General partners (199,045) 465,102 (715,522) $ 1,343,582 $ 4,651,021 $ (7,155,221) Per Unit of limited partnership interest: Income (loss) before extraordinary item $.17 $.41 $(0.72) Extraordinary item - .06 - Net income (loss) $.17 $.47 $(0.72) See accompanying notes to consolidated financial statements. /TABLE
DEAN WITTER REALTY YIELD PLUS, L.P. CONSOLIDATED STATEMENTS OF PARTNERS' CAPITAL Years ended December 31, 1995, 1994 and 1993 Limited General Partners Partners Total Partners' capital (deficiency) at January 1, 1993 $121,091,031 $(4,176,484) $116,914,547 Net loss (6,439,699) (715,522) (7,155,221) Cash distributions (5,345,979) (593,997) (5,939,976) Partner's capital (deficiency) at December 31, 1993 109,305,353 (5,486,003) 103,819,350 Net income 4,185,919 465,102 4,651,021 Cash distributions (5,345,980) (593,996) (5,939,976) Partners' capital (deficiency) at December 31, 1994 108,145,292 (5,614,897) 102,530,395 Net income 1,542,627 (199,045) 1,343,582 Cash distributions (5,345,980) (593,996) (5,939,976) Partners' capital (deficiency) at December 31, 1995 $ 104,341,939 $(6,407,938) $ 97,934,001 See accompanying notes to consolidated financial statements. /TABLE
DEAN WITTER REALTY YIELD PLUS, L.P. Consolidated Statements of Cash Flows Years ended December 31, 1995, 1994 and 1993 1995 1994 1993 Cash flows from operating activities: Net income (loss) $1,343,582 $4,651,021 $(7,155,221) Adjustments to reconcile net income (loss) to net cash provided by operating activities: Depreciation and amortization 4,889,380 4,555,481 3,061,532 Minority interests in earnings of consolidated partnerships 1,711,380 749,457 1,372,107 Losses on impairment of real estate, participating mortgage and secured loans 6,931,459 1,711,683 12,858,595 Gain on sale of real estate (3,334,036) - - Increase in deferred expenses (593,204) (624,948) (248,428) Increase in other assets (802,195) (231,675) (99,140) Decrease accounts payable and other liabilities (366,257) (473,368) 2,560,493 Net cash provided by operating activities 9,780,109 10,337,651 12,349,938 Cash flows from investing activities: Proceeds from sales of real estate, net of closing costs 57,343,595 - - Investments in participating mortgage loans (390,034)(1,318,423)(776,610) Release of cash in escrow 5,000,000 - 400,000 Additions to real estate (821,485) (2,465,304) (989,174) Net cash provided by (used in) investing activities 61,132,076 (3,783,727) (1,365,784) Cash flows from financing activities: Repayments of mortgage notes payable(37,711,141) (8,878,006) (53,910) Repayments of bank loans (9,350,557) (267,180) - Loans from (repayments to) affiliates (1,726,524) 3,409 51,088 Cash distributions (5,939,976) (5,939,976) (5,939,976) Minority interest in distributions from consolidated partnerships (2,507,440) (1,357,785) (1,716,964) Contributions by minority interest to consolidated partnerships 489,992 989,425 - Proceeds from bank loans - 8,555,404 1,062,333 Effect of the change in cash from acquisitions (foreclosures) of partnerships - 253,660 (153,794) Net cash used in financing activities (56,745,646) (6,641,049) (6,751,223) Increase (decrease) in cash and cash equivalents 14,166,539 (87,125) 4,232,931 Cash and cash equivalents at beginning of year 4,772,726 4,859,851 626,920 Cash and cash equivalents at end of year $ 18,939,265 $ 4,772,726 $ 4,859,851 Supplemental disclosure of cash flow information: Cash paid for interest $ 5,794,644 $ 5,280,383 $ 1,497,011 See accompanying notes to consolidated financial statements. (Continued) /TABLE
DEAN WITTER REALTY YIELD PLUS, L.P. CONSOLIDATED STATEMENTS OF CASH FLOWS Years ended December 31, 1995, 1994 and 1993 1995 1994 1993 Supplemental disclosure of non-cash investing activities: Real estate acquired through in-substance foreclosure and foreclosure of mortgage loans $ - $(25,731,946)$(58,989,831) Investment in participating mortgage loans transferred to real estate $ - $ - $ 13,271,336 Mortgage notes payable assumed $ - $ 25,598,317 $ 45,198,476 Other assets acquired through foreclosures $ - $ (95,541) $ 1,028,511 Accounts payable and accrued liabilities acquired through foreclosures $ - $ 482,830 $(1,394,736) Foreclosure of real estate: Real estate $ - $ 4,150,000 $ - Mortgage note $ - $(4,150,000) $ - See accompanying notes to consolidated financial statements. /TABLE DEAN WITTER REALTY YIELD PLUS, L.P. Notes to Consolidated Financial Statements December 31, 1995, 1994 and 1993 1. The Partnership Dean Witter Realty Yield Plus, L.P. (the "Partnership") is a limited partnership organized under the laws of the State of Delaware in 1987. The Managing General Partner of the Partnership is Dean Witter Realty Yield Plus Inc., which is wholly-owned by Dean Witter Realty Inc. ("Realty"). The Partnership was formed to invest in the development and operation of income-producing commercial, residential and industrial properties. The Partnership issued 8,909,969 units of limited partnership interests (the "Units") for $178,199,380. No additional Units will be sold. 2. Summary of Significant Accounting Policies The financial statements include the accounts of the Partnership, DW Columbia Gateway Associates, DW Michelson Associates, DW Lakeshore Associates (formerly Lakeshore Ontario Associates), Deptford Crossing Associates (effective July 16, 1993), Hampton Crossing Associates (effective September 7, 1993), and DW Community Centers Limited Partnership and DW Maplewood Inc. (effective April 4, 1994) on a consolidated basis. All significant intercompany accounts and transactions have been eliminated. The Partnership's records are maintained on the accrual basis of accounting for financial reporting and tax purposes. The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Real estate acquired in settlement of loans was recorded at the lower of the book value of the investment or estimated fair value of the property at the date of foreclosure or in-substance foreclosure. Costs of improvements to the properties are capitalized and repairs are expensed. Depreciation is recorded on the straight-line method over useful lives ranging from 15 to 40 years. At least annually, and more often if circumstances dictate, the Partnership evaluates the recoverability of the net carrying value of its real estate. As part of this evaluation, the fair values of each of the properties are estimated (in some cases with the assistance of independent real estate consultants) based on discounted cash flows. The fair values are compared to the properties' carrying amounts in the financial statements. A deficiency in fair value relative to carrying amount is an indication of the need for a writedown due to impairment. In such case, the expected future net cash flows from the property are estimated for a period of approximately five years ( or a shorter period if the Partnership expects that the property may be disposed of sooner), along with estimated sales proceeds at the end of the period. If the total of these future undiscounted cash flows were less than the carrying amount of the property, the property would be written down to its fair value and a loss on impairment recognized by a charge to earnings. The Partnership's accounting policy complies with Statement of Financial Accounting Standards No. 121, "Accounting for the Impairment of Long- Lived Assets and for Long-Lived Assets to be Disposed Of". The Partnership also periodically evaluates the collectibility of both interest and principal of its investment in the participating mortgage loan to determine whether it is impaired. The mortgage loan is considered to be impaired when, based on current information and events, it is probable that the Partnership will be unable to collect all amounts due according to the existing contractual terms of the loan. When the mortgage loan is considered to be impaired, the Partnership establishes a valuation allowance equal to the difference between a) the carrying value of the loan, and b) the present value of the expected cash flows from the loan at its effective interest rate, or, for practical purposes, at the estimated fair value of the real estate collateralizing the loan. The Partnership's accounting policy complies with Statements of Financial Accounting Standards No. 114 and No. 118 with respect to accounting by creditors for impairment of a loan. Because the determination of fair value is based upon projections of future economic events such as property occupancy rates, rental rates, operating cost inflation and market capitalization rates which are inherently subjective, the amounts ultimately realized at disposition may differ materially from the net carrying value as of December 31, 1995. The cash flows used to determine fair value are based on good faith estimates and assumptions developed by the Managing General Partner. Unanticipated events and circumstances may occur and some assumptions may not materialize; therefore actual results may vary from the estimates and the variances may be material. The Partnership may provide additional writedowns on its real estate or valuation allowance on its loan which could be material, in subsequent years if real estate markets or local economic conditions change. Cash and cash equivalents consist of cash and highly liquid investments with maturities, when purchased, of three months or less. Deferred expenses consist of origination fees in connection with the participating mortgage loan and leasing commissions. Origination fees are amortized over the loan term, which approximates the effective yield method. Leasing commissions are amortized over the applicable lease terms. Rental income is accrued on a straight-line basis over the terms of the leases. Accruals in excess of amounts payable by tenants pursuant to their leases (resulting from rent concessions or rents which periodically increase over the term of a lease) are recorded as receivables and included in other assets. Net income (loss) per Unit amounts are calculated by dividing net income (loss) allocated to Limited Partners, in accordance with the Partnership agreement, by the weighted-average number of Units outstanding. No provision for income taxes has been made in the financial statements, since the liability for such taxes is that of the partners rather than the Partnership. The accounting policies used for tax reporting purposes differ from those used for financial reporting as follows: (a) depreciation is calculated using accelerated methods, (b) rental income is recognized based on the payment terms in the applicable leases, and (c) writedowns for impairments of real estate and the participating mortgage loan are not deductible. In addition, offering costs are treated differently for tax and financial reporting purposes. The tax basis of the Partnership's assets and liabilities is approximately $58 million higher than the amounts reported for financial statement purposes at December 31, 1995. 3. Partnership Agreement The Partnership Agreement provides that net cash flow, as defined, will be paid 90% to the Limited Partners and 10% to the General Partners. Pursuant to the Agreement, $1,239,345 of the General Partners' share of such net cash flow distributable to them through December 31, 1990 was deferred, subject to receipt by the Limited Partners of an 8% annual return on their invested capital. Sale or financing proceeds will be distributed, to the extent available: first, 97% to the Limited Partners and 3% to the General Partners until Limited Partners receive a return of their invested capital plus an amount sufficient to provide a 10% cumulative annual return thereon; second, 100% to the General Partners until they have received the amount of any net cash flow deferred through December 31, 1990; and third, 85% to the Limited Partners and 15% to the General Partners. The General Partners are permitted to defer receipt of distributions otherwise payable to them. Taxable income generally will be allocated to the partners in proportion to the distribution of distributable cash or sale or financing proceeds, as the case may be (or 90% to the Limited Partners and 10% to the General Partners if there is no distributable cash or sale or financing proceeds). Tax losses, if any, are allocated 90% to the Limited Partners and 10% to the General Partners. Distributions paid to limited partners include returns of capital per Unit of limited partnership interest of $0.46, $0.13 and $0.60, for the years ended December 31, 1995, 1994 and 1993, respectively, calculated as the excess of cash distributed per Unit over accumulated earnings per Unit not previously distributed. 4. Investments in Real Estate 2600 Michelson Drive, Irvine, California DW Michelson Associates, a general partnership which is owned by the Partnership (50.81%) and Dean Witter Realty Yield Plus II ("Yield Plus II"), an affiliated partnership (49.19%) had made a land purchase, a subsequent land lease, and a mortgage loan on 2600 Michelson Drive, an office complex consisting of three office buildings and underlying land, in 1988. The total investment in the property is approximately $71 million, of which the Partnership contributed $36 million. In 1990, the borrower/land lessee defaulted on the loan and, in 1991, DW Michelson effectively obtained ownership of the property. DW Michelson contributed a portion of its loan as equity to the ownership entity, which is a limited partnership of which DW Michelson is the managing general partner and the principal of the original borrower is a limited partner. DW Michelson receives interest on its loan, lease payments on the land and a preferred return on its equity. DW Michelson also received a promissory note of approximately $1.2 million from the borrower. In July 1994, the note, which was past due, was extended until December 31, 1999. At December 31, 1995, the balance of this note is approximately $1.2 million. An affiliate of Realty manages the property. Greenway Pointe, Columbia, Maryland In 1990, the Partnership acquired Greenway Pointe, which consists of three office/research and development buildings and land from the borrower for an amount equal to the then-outstanding loan balance. An affiliate of Realty manages the property. 401 East Ontario Street, Chicago, Illinois Through 1990, the Partnership funded an approximately $47,000,000 leasehold mortgage loan, land purchase and participating land lease for 401 East Ontario Street, a high rise luxury apartment building. The property was developed and owned by Lakeshore Ontario Associates, a 50/50 joint venture between a Chicago developer ("Chicago Developer") and an entity comprised of former and current Realty employees, several of whom are former or current officers of the Managing General Partner. The Partnership received a completion guaranty and a $6,000,000 operating deficits guaranty from the borrower/land lessee. One half of these guarantees was the obligation of Realty and the other half was the obligation of the principals of the Chicago Developer. Realty funded all of the additional construction costs (approximately $2,300,000) and had fully funded its obligation under the operating deficits guaranty of $4,509,212 as of December 31, 1993. Beginning in March 1992, the Chicago Developer failed to fund its obligation under the operating deficits guaranty plus accrued interest on the unpaid balance which was reserved in full. This resulted in a default on its loan. As of December 31, 1992, the Partnership accounted for this loan as if the property were foreclosed upon, wrote down the loan to its estimated fair value, which resulted in a loss of $10,915,869, and reclassified the loan to real estate. In January 1994, the borrower transferred to the Partnership the ownership of the improvements by deed-in-lieu of foreclosure. In addition, the Chicago Developer paid the Partnership $350,000 (included in other income) in exchange for the Partnership's and Realty's releasing the principals of the Chicago Developer from any continuing liability under their deficit guarantee. In late February 1995, cracks and spalling were observed on certain portions of the concrete exterior at the 401 East Ontario Street property in Chicago, IL. The worst spalls were removed and temporary repairs were completed. Beginning in March, the Partnership retained the services of three independent engineering firms which completed studies and submitted separate reports. Their reports confirmed that cracking and spalling of this nature is highly unusual for a building of this age, and attribute the problems to both the defective design and construction of the building. The Partnership also retained two architectural firms to work with the engineers in developing permanent repair specifications. Drawings and specifications for the exterior concrete repair work were submitted to five qualified contractors for bidding purposes; the contract was awarded to the lowest bidder. Permanent repair work began in September and is currently scheduled to be completed prior to December 31, 1996. Expenditures in 1995 for the extensive testing and engineering analysis and the repairs was approximately $1.5 million and the cost of permanent repairs is expected to approximate $6 million. Other costs (litigation, rent loss, increased maintenance, etc.) are still being developed. The Partnership has notified its insurance carrier of these problems and its remedial activities to date and, in early May 1995, the Partnership initiated litigation against those it deemed responsible for the design and construction of the building including the architect, structural engineer, general contractor and others. The extent to which the above-described costs may be recoverable through insurance or litigation proceeds cannot be determined at this time. Deptford Crossing, Deptford, New Jersey In March 1991, the Partnership made a participating loan secured by partnership interests on Deptford Crossing, a community shopping center. Beginning in 1992, the borrower defaulted on the loan. As of December 31, 1992, the Partnership accounted for the loan as if the property was foreclosed upon and reclassified the loan to real estate. In July 1993, the ownership interests in the project were transferred to the Partnership in lieu of foreclosure. Because of continuing weakness in the Deptford, New Jersey retail market, and the likelihood that such weakness would persist for several years, in the third quarter of 1995, the Partnership concluded that the property was impaired. Accordingly, the Partnership recorded a loss on impairment of the property of approximately $6,931,000 at September 30, 1995. The property is subject to a first mortgage loan. See note 7. An affiliate of Realty manages the property. Hampton Village Centre, Rochester Hills, Michigan The Partnership's borrower had obtained a first mortgage loan of $29,000,000 secured by Phase I of the project. See note 7. The Partnership had made three mortgage loans totaling approximately $13,300,000 to Hampton Village Centre which provided for a 50% participation in the property's excess cash flow and appreciation over $40,000,000. Two of these loans were in default and were placed on non- accrual status in 1992; debt service continued to be paid through August 1993 on the remaining loan in the amount of $3,000,000 and bearing interest at 10.5%. During the first quarter of 1993, the Partnership accelerated all of its loans and instituted foreclosure proceedings. In September 1993, the Partnership indirectly acquired one-half of the partnership interests of Hampton Crossing Associates, the owner of Hampton Village Centre, thereby obtaining effective control of the center, and began accounting for the loans as if the property were owned, by reclassifying the loans to real estate and recording the $29,000,000 first mortgage loan. During the first quarter of 1994, the Partnership indirectly acquired all of the partnership interests of Hampton Crossing Associates not previously owned by it. Contractors who worked on the property had brought claims of about $2,000,000 against the borrower and had filed liens against the property. During 1994, the Partnership settled all but one of these claims for approximately $300,000. Settlement of the remaining claim in 1995 did not have a material impact on the financial statements. An affiliate of Realty managed the property. In December 1995, the Partnership sold this property. See Note 5. Shopping Centers Investments, Michigan, Ohio, and Tennessee In 1990, the Partnership loaned $6,000,000 to the partners of the developer of eleven community shopping centers and the Hampton Crossing and Deptford Crossing properties. The loan was secured by interests in eleven partnerships which owned the eleven community shopping centers, all of which were encumbered by mortgages. During the second quarter of 1991, as a result of the sale of three of the shopping centers, the Partnership received a partial payment on the loan, but the borrower failed to pay the balance when due in August 1991. The Partnership fully reserved the remaining balance of the loan of $4,664,471 as of December 31, 1992. During the first six months of 1994, the mortgagees foreclosed on four of the properties. In April 1994, the Partnership obtained sole control of the partnerships which own the Hickory Ridge Crossing, Midway Crossing and Genessee Crossing community shopping centers and joint control of the partnership which owns the Farmington Crossroads Center. At that date, the Partnership consolidated these partnerships and recorded their assets and liabilities at estimated fair values. The Partnership also retained two parcels of land not subject to mortgages. The Hickory Ridge Crossing Center was encumbered by a $4,150,000 mortgage note which was not repaid when due in June 1994. In September 1994, the mortgagee foreclosed on the property. The loss of the property did not have a material impact on the financial statements. In December 1995, the Partnership sold the Midway Crossing and Farmington Crossroads shopping centers. See Note 5.
The locations, years of acquisition through foreclosure or in-substance foreclosure and net carrying values of the Partnership's properties are as follows: Year of December 31, Property Acquisition 1995 1994 2600 Michelson Drive Irvine, CA 1990 $ 38,512,516 $ 39,700,273 Greenway Pointe Columbia, MD 1990 5,666,304 6,051,875 401 East Ontario Street Chicago, IL 1992 34,746,550 35,353,149 Deptford Crossing Deptford, NJ 1992 10,903,021 18,211,229 Genessee Crossing Flint, MI 1994 8,253,600 8,425,440 Pine Ridge (land) Flint, MI 1994 134,747 134,747 Military Crossing (land) Norfolk, VA 1994 300,000 300,000 Hampton Village Centre1 Rochester Hills, MI 1993 - 41,839,241 Midway Crossing1 Elyria, OH 1994 - 8,674,725 Farmington Crossroads1 Farmington Hills, MI 1994 - 3,863,980 $ 98,516,738 $162,554,659 1This property was sold in December 1995.
5. Sales of Real Estate On October 19, 1995, the Partnership and certain of its subsidiaries entered into an agreement with New Plan Realty, to sell the land and buildings which comprise the Hampton Village Centre, Midway Crossing, Farmington Crossroads and Genessee Crossing shopping centers. The agreement was subsequently amended to, among other things, eliminate the sale of the Genessee Crossing shopping center. The closing of the sale of the Hampton Village Centre, Midway Crossing and Farmington Crossroads shopping centers, for a negotiated sales price of approximately $58,250,000, took place on December 11, 1995. At closing, a portion of the sales proceeds were used to prepay the existing mortgages encumbering Hampton Village Centre and Farmington Crossroads. Secured borrowings under two bank lines of credit and the loan from an affiliate were also prepaid in full. After reserves relating to the 401 East Ontario Street property (see Note 4), the Partnership distributed approximately $6.4 million to the Limited Partners in January 1996. See Notes 7, 8 and 10. The aggregate net income and cash flow from operations from the shopping centers sold for the year ended December 31, 1995 was approximately $1,870,000 and $2,550,000, respectively. Interest expense relating to the loans secured by the shopping centers was approximately $3,600,000. 6. Investment in Participating Mortgage One Congress Street, Boston, Massachusetts In 1989, the Partnership and Yield Plus II entered into an agreement to provide $59.2 million of participating mortgage construction and permanent financing for the One Congress Street building. As modified in 1991 and 1993, the investment is a 10-year permanent second mortgage loan. Base interest is payable at 8% and the first $250,000 of net revenues in any calendar year from the property is payable as Additional Interest. Also, the Partnership and Yield Plus II own a 58% interest in adjusted net revenue and capital proceeds generated by the property. The Partnership and Yield Plus II have fully funded their commitments of $34.35 and $24.85 million, respectively. The General Services Administration ("GSA"), leased all of the office space at the property, and had a one-time option to cancel all or a portion of its lease at any time prior to its lease expiration in August 1997. In March 1996, GSA notified the owner/borrower of the One Congress Street property that it will vacate approximately 67,500 Square feet (approximately 28%) of the office space at the property in June 1996. The borrower continues discussions with the GSA regarding renewal of its remaining space at the property as well as the pending claim against the GSA relating to the original construction of its space. If the borrower can not re-lease the space which GSA will vacate, property cash flow will be reduced, and the borrower may not be able to meet its minimum debt service obligation. In 1993, the Partnership concluded that the value of the One Congress Street property and the Partnership's related loan were impaired. Accordingly, as of December 31, 1993, the Partnership established an allowance of $12,858,595 against the loan. The $1.7 million loss on impairment in 1994 represents approximately $1.3 million funded and reserved in 1994 and approximately $0.4 million reserved in 1994 and funded in early 1995. One of the general partners of the borrower filed a voluntary petition under Chapter 11 of the Bankruptcy Code in 1991. This matter constitutes an event of default under the first and second mortgage loans. However, neither the first mortgage lender (Aetna Life and Casualty) nor the Partnership has declared a default. The ultimate impact of the bankruptcy on the loan is uncertain. The estimated fair value of the Partnership's loan at December 31, 1995 is approximately $20.3 million. The fair value estimate is based on the net present value of the estimated future cash flows from the loan. The discount rate used is based on current lending rates and market conditions. The Partnership intends to hold the participating mortgage loan to maturity. 7. Mortgage Notes Payable The Partnership's properties are subject to first mortgage notes as follows:
December 31, 1995 1994 Mortgage note due March 14, 1997; $11,413,736 $16,051,554 secured by the Deptford Crossing shopping center: Interest at the Partnership's election of LIBOR plus .375%, the bank's quoted variable rate plus 1.375% or the bank's fixed rate; interest and $15,000 of principal payable monthly through maturity. Mortgage notes due May 15, 1997; secured by 8,590,000 8,590,000 the Genessee Crossing Shopping Center: interest- only payable monthly at 9.375%. Mortgage note due May 16, 2000; secured by - 29,000,000 Phase I of the Hampton Village Centre shopping center: interest at 9.375%; interest-only payable monthly through May 16, 1997, at which time monthly payments adjust to equal a 25-year amortization of principal and interest. Note repaid when property was sold (See Note 5). Mortgage note due September 1, 1999; secured - 4,073,323 by Farmington Crossroads Shopping Center: interest at 7.875%; principal and interest of $32,338 payable monthly. Note repaid when property was sold (See Note 5.) $20,003,736 $57,714,877
The fair value of the mortgage notes payable are approximately equal to their carrying values. The fair value is estimated by discounting future principal and interest payments using current lending rates and market conditions for instruments with similar maturities and credit quality. The mortgage note securing the Deptford Crossing property, originally maturing in March 1996 was modified in November 1995. As part of the modification, the maturity of the note was extended until March 1997, with an option to extend to September 1997 if certain conditions are met, and the semiannual principal payments of $53,910 were revised to monthly principal payments of $15,000. The Partnership had provided a $5 million letter of credit, secured by Partnership cash reserves to the lender to secure repayment. As part of the restructuring, $4.5 million of the cash reserves were used to repay principal and $500,000 was used to establish a real estate tax escrow account. At December 31, 1995, the interest rate was 7% on this loan. Future principal payments as of December 31, 1995 on the mortgage notes are as follows:
Year Amount 1996 $ 180,000 1997 19,823,736 Total $ 20,003,736
8. Loans Payable In August 1994, the Partnership increased its existing $3 million bank line of credit to $5 million and borrowed the available amount of approximately $4.1 million. Contemporaneously, the Partnership established an additional $6 million line of credit with the bank and borrowed approximately $4.5 million. These borrowings were used to repay mortgage loans secured by the Midway Crossing Shopping Center aggregating approximately $8.2 million (after forgiveness of $626,375 of the loan by the mortgagee), and delinquent real estate taxes and closing costs totaling approximately $312,000. The remaining borrowings were used to increase Partnership cash reserves. Borrowings under both of the bank lines of credit, which bore interest at the prime rate (8.5% at December 31, 1995 and 1994) plus one quarter percent and were secured by certain of the Partnership's properties were repaid from the proceeds from the sale of the shopping centers described in Note 5. 9. Leases Minimum future rentals under noncancellable operating leases as of December 31, 1995 are as follows:
Year ending December 31, 1996 $ 9,434,858 1997 8,310,074 1998 6,973,394 1999 4,488,463 2000 3,295,238 Thereafter 5,657,237 Total $38,159,264
The Partnership has determined that all leases relating to its properties are operating leases. These leases range in term from one to twenty-two years, and generally provide for fixed minimum rent with rental escalation and/or expense reimbursement clauses. 10. Related Party Transactions An affiliate of Realty provided property management services for four properties in 1995, 1994 and 1993. The Partnership paid the affiliate property management fees (included in property operating expenses) of $327,228, $316,768 and $312,070 for the years ended December 31, 1995, 1994 and 1993, respectively. Realty performs administrative functions, and processes certain investor and tax information on behalf of the Partnership. For the years ended December 31, 1995, 1994 and 1993, the affiliate was reimbursed $445,383, 422,199 and $437,969, respectively (included in general and administrative expenses), for these services. As of December 31, 1995, the affiliate was owed $55,996, which is included in accounts payable and other liabilities. In 1991, the Partnership borrowed funds from an affiliate of Realty to fund investments in participating mortgage loans and capital expenditures. Interest expense, which was calculated using the prime rate, was $154,491 in 1995, $123,508 in 1994 and $103,437 in 1993. The loan was repaid in December 1995 out of the proceeds of the sale of the shopping centers see Note 5. 11. Litigation Various public partnerships sponsored by Realty (including the Partnership and its Managing General Partner) have been named as defendants in four class actions lawsuits pending in state and federal courts. The complaints allege a variety of claims, including breach of fiduciary duty, fraud, misrepresentation and related claims, and seek compensatory and other damages and equitable relief. The defendants have not yet responded to the complaints and intend to vigorously defend the actions. It is impossible to predict the effect, if any, the outcome of these actions might have on the Partnership's financial statements. 12. Subsequent Event In January 1996 the Partnership paid a cash distribution of $.15 per Unit to Limited Partners. The distribution was $1,484,994 with $1,336,495 of cash distributed to Limited Partners and $148,499 of cash distributed to the General Partners. The Partnership also paid a distribution in January 1996 of the net proceeds from the sale of the shopping centers. All of the net proceeds of $6,412,164 ($.72 per Unit) were distributed to the Limited Partners. The General Partner deferred receipt of any proceeds as permitted by the partnership agreement. ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE. None. PART III. ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT. The Partnership is a limited partnership and has no directors or officers. The directors and executive officers of the Managing General Partner are as follows: Position with the Name Managing General Partner William B. Smith Chairman of the Board of Directors E. Davisson Hardman, Jr. President and Director Lawrence Volpe Controller, Assistant Secretary and Director Ronald T. Carman Secretary and Director All of the directors have been elected to serve until the next annual meeting of the Shareholders of the Managing General Partner or until their successors are elected and qualify. Each of the officers has been elected to serve until his successor is elected and qualifies. William B. Smith, age 52, is a Managing Director of Dean Witter Realty Inc. and has been with Dean Witter Realty Inc. since 1982. He is an Executive Vice President of Dean Witter Reynolds Inc. E. Davisson Hardman, Jr., age 46 is a Managing Director of Dean Witter Realty Inc. and has been with Dean Witter Realty Inc. since 1982. Lawrence Volpe, age 48, is a Director and the Controller of Dean Witter Realty Inc. He is a Senior Vice President and Controller of Dean Witter Reynolds Inc., which he joined in 1983. Ronald T. Carman, age 44, is a Director and the Secretary of Dean Witter Realty, Inc. He is a Senior Vice President and Associate General Counsel of Dean Witter, Discover & Co. and Dean Witter Reynolds Inc., which he joined in 1984. There is no family relationship among any of the foregoing persons. ITEM 11. EXECUTIVE COMPENSATION The General Partners are entitled to receive cash distributions, when and as cash distributions are made to the Limited Partners, and a share of taxable income or tax loss. Descriptions of such distributions and allocations are contained in Item 5 above. The General Partners received cash distributions totalling $593,996, 593,996 and $593,997 during the years ended December 31, 1995, 1994 and 1993, respectively. The General Partners and their affiliates were paid certain fees and reimbursed for certain expenses. Information concerning such fees and reimbursements is contained in Note 10 to the consolidated financial statements in Item 8 above. The directors and executive officers of the Partnership's Managing General Partner received no renumeration from the Partnership. ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT. (a) No person is known to the Partnership to be the beneficial owner of more than five percent of the Units. (b) The executive officers and directors of the Managing General Partner own the following Units as of December 31, 1995:
Amount and Nature of Title of Class Name of Beneficial Owner Beneficial Ownership Limited William B. Smith * Partnership Interests E. Davisson Hardman, Jr. * All directors and executive * officers of the Managing General Partner, as a group *Owns, by virtue of ownership of limited partnership interests in the Associate General Partner, less than 1% of the Units of the Partnership.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS. As a result of their being partners of a limited partnership which is the limited partner of the Associate General Partner, certain current and former officers and directors of the Managing General Partner also own indirect general partnership interests in the Partnership. The Partnership Agreement of the Partnership provides that cash distributions and allocations of income and loss to the general partners shall be distributed or allocated 50% to the Managing General Partner and 50% to the Associate General Partner. The general partners' share of cash distributions and income or loss is described in Item 5 above. All of the outstanding shares of common stock of the Managing General Partner are owned by Dean Witter Realty Inc., a Delaware corporation which is a wholly-owned subsidiary of Dean Witter, Discover & Co. The general partner of the Associate General Partner is Dean Witter Realty Yield Plus Inc., which is a wholly-owned subsidiary of Dean Witter Realty Inc. The limited partner of the Associate General Partner is LSYP 87, L.P., a Delaware limited partnership. Certain current and former officers and directors of the Managing General Partner are partners of LSYP 87, L.P. Additional information with respect to the directors and executive officers and compensation of the Managing General Partner and affiliates is contained in Items 10 and 11 above. The 401 East Ontario Street property was developed by a joint venture between the Chicago Developer and an entity comprised of former and current Realty executives, several of whom are former or current executive officers of the Managing General Partner. In January 1994, the Partnership obtained ownership of the property by deed-in-lieu of foreclosure. The Hampton Village Centre property was developed by Hampton Crossing Associates, a joint venture between the Partnership and an entity comprised of former and current Realty executives, several of whom are former or current executive officers of the Managing General Partner. In the first quarter of 1994, the Partnership indirectly obtained ownership of all the partnership interests in Hampton Crossing Associates. The One Congress Street property was developed by a partnership between a Maryland-based developer and an entity comprised of former Realty executives, some of whom were formerly executive officers of the Managing General Partner. This entity withdrew as a partner of the borrower in September 1993, so the borrower partnership is now controlled solely by the Maryland-based developer. The General Partners and their affiliates were paid certain fees and reimbursed for certain expenses. Information concerning such fees and reimbursements is contained in Note 10 of the Notes to Consolidated Financial Statements in Item 8 above. The Partnership believes that the payment of fees and the reimbursement of expenses to the General Partners and their affiliates are on terms as favorable as would be obtained from unrelated third parties. PART IV ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K. (a) The following documents are filed as part of this Annual Report: 1. Financial Statements (see Index to Financial Statements filed as part of Item 8 of this Annual Report). 2. Financial Statement Schedules (see Index to Financial Statements filed as part of Item 8 of this Annual Report). 3. Exhibits (2) Not applicable. (3)(a) Amended and Restated Agreement of Limited Partnership dated as of April 29, 1987 set forth in Exhibit A to the Prospectus included in Registration Statement Number 33-11648 is incorporated herein by reference. (3)(b) Certificate of Limited Partnership dated as of April 29, 1987 incorporated by reference in Registration Statement Number 33-11648 is incorporated herein by reference. (4)(a) Amended and Restated Agreement of Limited Partnership dated as of April 29, 1987 set forth in Exhibit A to the Prospectus included in Registration Statement Number 33-11648 is incorporated herein by reference. (4)(b) Certificate of Limited Partnership dated as of April 29, 1987 incorporated by reference in Registration Statement Number 33-11648 is incorporated herein by reference. (9) Not applicable. (10) Not applicable. (11) Not applicable. (12) Not applicable. (13) Not applicable. (16) Letter regarding change in certifying accountant Incorporated by reference in Partnership's Current Report on Form 8-K dated December 15, 1994. (18) Not applicable. (19) Not applicable. (21) Subsidiaries: Deptford Crossing Associates, a New Jersey limited partnership. Hampton Crossing Associates, a Michigan limited partnership. DW Lakeshore Associates, an Illinois limited partnership. DW Columbia Gateway Associates, a Maryland limited partnership. Midway Crossing Limited Partnership, a Michigan limited partnership. Genessee Crossing Limited Partnership, a Michigan limited partnership. Farmington/9 Mile Associates, a Michigan limited partnership. Michelson Company Limited Partnership, a California limited partnership. (22) Not applicable. (23) Not applicable. (24) Not applicable. (27) Financial Data Schedule (28) Not applicable. (99) Not applicable. (b) Reports on Form 8-K - Report dated December 15, 1994 of the change in the Partnership's Independent Auditor for the year ending December 31, 1995. (c) See 3 above (d) Financial Statements Schedule 1. Financial statements of GCGA Limited Partnership, an office building/parking garage located in Boston, Massachusetts. To be filed by 10-K/A when received by GCGA Limited Partnership.
SCHEDULE III DEAN WITTER REALTY YIELD PLUS, L.P. Real Estate and Accumulated Depreciation December 31, 1995 Initial cost to Partnership (A) Building and Description Encumbrances Land Improvements Total Residential Building Chicago, IL - 4,063,111 32,936,889 37,000,000 Office Building Columbia, MD - 1,976,457 6,338,507 8,314,964 Office Buildings Irvine, CA - 6,549,305 61,019,949 67,569,254 Shopping center Deptford, NJ 11,413,736 6,250,094 12,041,180 18,291,274 Shopping center Rochester Hills, MI - 12,643,133 30,155,424 42,798,557 Shopping Center Elyria, OH - 700,984 8,118,725 8,819,709 Shopping Center Flint, MI 8,590,000 1,709,535 6,830,465 8,540,000 Shopping Center Farmington, Hills, MI - 426,855 3,495,382 3,922,237 Land Pine Ridge Flint, MI - 134,747 - 134,747 Land Military Crossing Norfolk, VA - 300,000 - 300,000 20,003,736 34,754,221 160,936,521 195,690,742 /TABLE
Gross Amount at which Carried at End of Period (B) Cost Losses on Capitalized Impairment of Subsequent to Sale of Land and Description Acquisition Real Estate Real estate Land Residential Building Chicago, IL 236,084 - - 4,063,111 Office Building Columbia, MD 2,506,385 - (2,719,485) 1,387,066 Office Buildings Irvine, CA 3,436,223 - (24,202,321) 4,080,416 Shopping center Deptford, NJ 509,799 - (6,931,459) 1,770,000 Shopping center Rochester Hills, MI 16,908 (42,815,465) - - Shopping Center Elyria, OH - (8,819,709) - - Shopping Center Flint, MI - - - 1,709,535 Shopping Center Farmington, Hills, MI - (3,922,237) - Land Pine Ridge Flint, MI - - - 134,747 Land Military Crossing Norfolk, VA - - - 300,000 6,705,399 (55,557,411) (33,853,265) 13,444,875 /TABLE
Accumulated Buildings and Depreciation Date of Description Improvements Total (c) Construction Residential Building Chicago, IL 33,172,973 37,236,084 2,489,534 1990 Office Building Columbia, MD 6,714,798 8,101,864 2,435,560 1988 Office Buildings Irvine, CA 42,722,740 46,803,156 8,290,640 1986-1989 Shopping center Deptford, NJ 10,099,614 11,869,614 966,593 1991 Shopping Center Rochester Hills, MI - - - 1988 - 1993 Shopping Center Elyria, OH - - - 1987 Shopping Center Flint, MI 6,830,465 8,540,000 286,400 1988 Shopping Center Farmington Hills, MI - - - 1985 Land Pine Ridge - 134,747 - N/A Flint, MI Land Military Crossing Norfolk, VA - 300,000 - N/A 99,540,590 112,985,465 14,468,727 /TABLE
Life on which Depreciation in latest income Date Statements is Description Acquired Computed Residential Building Chicago, IL Dec. 1992 40 years Office Building Columbia, MD May 1990 15-40 years Office Buildings Irvine, CA Nov 1990 15-40 years Shopping Center Deptford, NJ Dec 1992 40 years Shopping Center Rochester Hills, MI Sept 1993 40 years Shopping Center Elyria, OH April 1994 40 years Shopping Center Flint, MI April 1994 40 years Shopping Center Farmington Hills, MI April 1994 40 years Pine Ridge Flint, MI June 1994 - Military Crossing Norfolk, VA April 1994 -
Notes: (A) The basis in the properties for financial reporting purposes is net realizable value or fair market value at the date of foreclosure or in- substance foreclosure. The loss in the amount of $26,921,806 on foreclosure of real estate does not reduce the basis for federal income tax purposes. (B) Reconciliation of real estate owned: 1995 1994 1993 Balance at beginning of period $174,652,851 $150,605,601 $ 90,626,596 Additions during period: Acquisition through foreclosures - 25,731,946 58,989,831 Improvements 821,485 2,465,304 989,174 Deductions during year: Foreclosure of real estate - (4,150,000) - Sale of real estate (55,557,412) - - Losses on impairment of real estate (6,931,459) - - Balance at end of period $112,985,465 $174,652,851 $150,605,601 (C) Reconciliation of accumulated depreciation: Balance at beginning of year $ 12,098,192 7,953,483 5,126,596 Depreciation expense 4,342,062 4,144,709 2,826,887 Sale or real estate (1,971,527) - - Balance end of period $ 14,468,727 $ 12,098,192 $ 7,953,483
SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. DEAN WITTER REALTY YIELD PLUS, L.P. By: Dean Witter Realty Yield Plus Inc. Managing General Partner By: /s/E. Davisson Hardman, Jr. Date: April 1, 1996 E. Davisson Hardman, Jr. President By: /s/Lawrence Volpe Date: April 1, 1996 Lawrence Volpe Controller (Principal Financial and Accounting Officer) Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated. DEAN WITTER REALTY YIELD PLUS INC. Managing General Partner /s/William B. Smith Date: April 1, 1996 William B. Smith Chairman of the Board of Directors /s/E. Davisson Hardman, Jr. Date: April 1, 1996 E. Davisson Hardman, Jr. Director /s/Lawrence Volpe Date: April 1, 1996 Lawrence Volpe Director /s/Ronald T. Carman Date: April 1, 1996 Ronald T. Carman Director
Exhibit Index for Dean Witter Realty Yield Plus, L.P. Exhibit Description Sequential No. Page No. _________ ____________ ________ (3)(a)* Amended and Restated Agreement of Limited Partnership dated as of April 29, 1987 set forth in Exhibit A to the Prospectus included in Registration Statement Number 33-11648 is incorporated herein by reference. (3)(b)* Certificate of Limited Partnership dated as of April 29, 1987 incorporated by reference in Registration Statement Number 33- 11648 is incorporated herein by reference. (4)(a)* Amended and Restated Agreement of Limited Partnership dated as of April 29, 1987 set forth in Exhibit A to the Prospectus included in Registration Statement Number 33-11648 is incorporated herein by reference. (4)(b)* Certificate of Limited Partnership dated as of April 29, 1987 incorporated by reference in Registration Statement Number 33- 11648 is incorporated herein by reference. (10)(a) Partnership Agreement for DW Michelson Associates dated March 14, 1988. (10)(b)* First Mortgage Promissory Note, dated April 26, 1989, between the Government Center Garage Realty Trust (Maker) and Dean Witter Realty Yield Plus, L.P. (Holder) was filed as Exhibit to Amendment No. 2 to Current Report on Form 8-K on April 26, 1989 and is incorporated herein by reference. (10)(c)* Construction Loan Agreement, dated April 26, 1989, between Government Center Garage Realty Trust, as Borrower and Dean Witter Realty Yield Plus, L.P. and Dean Witter Realty Yield Plus II, L.P., as Lender was filed as Exhibit to Amendment No. 2 to Current Report on Form 8-K on April 26, 1989 and is incorporated herein by reference. (10)(d)* Intercreditor Agreement among Dean Witter Realty Yield Plus, L.P., Dean Witter Realty Yield Plus II, L.P., and Realty Management Services Inc. dated as of April 26, 1989 was filed as Exhibit to Amendment No. 2 to Current Report on Form 8-K on April 26, 1989 and is incorporated herein by reference. (10)(e) First Amendment to Construction Loan Agreement dated October 12, 1989 between Government Center Garage Realty Trust, as Borrower and Dean Witter Realty Yield Plus, L.P. and Dean Witter Realty Yield Plus II, L.P., as Lender. (10)(f) Amended and Restated Construction Loan/Office Loan Promissory Note dated October 12, 1989 between Government Center Garage Realty Trust (Maker) and Dean Witter Realty Yield Plus, L.P. (Holder). (10)(g) Second Amendment to Construction Loan Agreement dated June 22, 1990 between Government Center Garage Realty Trust, as Borrower and Dean Witter Realty Yield Plus, L.P. and Dean Witter Realty Yield Plus II, L.P., as Lender. (10)(h) First Amendment to Amended and Restated Construction Loan/Office Loan Promissory Note dated June 22, 1990 between Government Center Garage Realty Trust (Maker) and Dean Witter Realty Yield Plus, L.P. (Holder). (10)(i) Supplemental Loan Agreement dated September 20, 1993 between Government Center Garage Realty Trust, as Borrower and Dean Witter Realty Yield Plus, L.P. and Dean Witter Realty Yield Plus II, L.P., as Lender. (10)(j) Second Amendment to Notes dated September 20, 1993 between Government Center Garage Realty Trust (Maker) and Dean Witter Realty Yield Plus, L.P. and Dean Witter Realty Yield Plus II, L.P., (Holders). *incorporated by reference
EX-10 2 Exhibit (10)(a) PARTNERSHIP AGREEMENT dated as of March 14, 1988, between DEAN WITTER REALTY YIELD PLUS, L.P., a Delaware limited partnership, and DEAN WITTER REALTY YIELD PLUS II, L.P., a Delaware limited partnership (each individually a "Partner" and collectively the "Partners"). In consideration of the mutual covenants contained herein, the Partners hereby form a general partnership under the laws of the State of California (the "Partnership") as follows: ARTICLE I General Provisions SECTION 1.01. Name of the Partnership. The name of the Partnership shall be DW Michelson Associates or such other name as the Partners may from time to time determine. The Partners shall execute and cause to be filed on behalf of the Partnership such partnership or assumed or fictitious name certificates as may from time to time be required by law to be published or filed in connection with the formation and operation of the Partnership. SECTION 1.02. Business of the Partnership. The business of the Partnership shall be (i) to acquire interests in real and personal property, tangible and intangible, located at 2600 Michelson Drive and 18851 Teller Avenue, Irvine, California (the "Irvine Property"), and (ii) to engage in any and all activities relating to the foregoing. The Partnership shall not engage in any other business without the prior unanimous approval of the Partners. The interests in the Irvine Property from time to time acquired by the Partnership together with any other property, real or personal, tangible or intangible, hereafter acquired by the Partnership is hereinafter collectively called the "Property." SECTION 1.03. Place of Business of the Partnership. The principal place of business of the Partnership shall be located at 130 Liberty Street, New York, New York, or at such other place or places as both Partners may from time to time designate. SECTION 1.04. Partners' Names and Addresses. The names and addresses of the Partners are as set forth in Schedule A. SECTION 1.05. Term of the Partnership. The Partnership shall commence as of the date of this Agreement and shall continue until terminated pursuant to the provisions of Article VII. SECTION 1.06. Partnership Act. Except as otherwise expressly provided in this Agreement, the rights and obligations of the Partners and the administration and dissolution of the Partnership shall be governed by the Partnership Law of the State of California as it may be from time to time amended. SECTION 1.07. Title to Partnership Property. The interest of each Partner in the Partnership is personal property. All property owned by the Partnership, whether real or personal, tangible or intangible, shall be deemed to be owned by the Partnership as an entity, and neither Partner, individually, shall have any ownership of such property. The Partnership may hold any of its assets in its own name or in the name of a nominee, which may be one or more individuals, corporations, partnerships, trusts or other entities. While this Agreement remains in effect, neither Partner, nor any successor-in-interest to either Partner, shall have the right to have the property of the Partnership partitioned or to file a complaint or institute any proceeding at law or in equity to have the property of the Partnership partitioned, and each Partner, on behalf of itself, its successors, representatives, heirs and assigns, waives any such right. It is the intention of the Partners that, during the term of this Agreement, the rights of the Partners and their successors-in-interest, as among themselves, shall be governed by the terms of this Agreement, and that the right of either Partner or its successor-in-interest to assign, transfer, sell or otherwise dispose of its interest in the property of the Partnership shall be subject to the limitations and restrictions of this Agreement. SECTION 1.08. Other Activities. Each Partner agrees that the other Partner or any person or entity affiliated with the other Partner may engage in or possess an interest in other business ventures of any nature and description, independently or with others, including, but not limited to, ventures that undertake activities similar to or in competition with the Partnership, and neither the Partnership nor either Partner shall have any rights by virtue of this Agreement in and to such independent ventures or to the income or profits derived therefrom. ARTICLE II Capital; Profits and Losses; Distributions SECTION 2.01. Capital Contributions. (a) In order to enable the Partnership to acquire, own, manage and operate the Property, the Partners shall, from time to time, make such capital contributions in such amounts and proportions as they may both agree. The amounts of such contributions and the respective shares of the Partners (the "Participation Percentages") in the net profits, net losses and distributions of the Partnership shall be set forth in a schedule substantially in the form of Schedule A hereto that shall be approved by both Partners. Schedule A attached hereto as of the date hereof is hereby approved by the Partners. All contributions to the Partnership shall be made in cash, and the respective Participation Percentages of the Partners at any date shall bear the same relationship to each other as do the Partners' respective aggregate contributions made on or prior to such date. (b) No interest shall accrue on any contributions to the capital of the Partnership, and neither Partner shall have the right to withdraw or to be repaid any capital contributed by it except as otherwise specifically provided in this Agreement. Each Partner shall look solely to the assets of the Partnership for the return of their capital contributions and shall in no event have recourse against the other Partner with respect thereto. SECTION 2.02. Capital Accounts. There shall be established and maintained on the books of the Partnership a capital account for each Partner. Capital accounts shall be maintained in accordance with the rules of Treasury Regulation Section 1.704(b)-1(b)(92)(iv). Accordingly, without limiting the generality of the foregoing sentence, there shall be credited to each Partner's capital account the amount of any capital contributions made by it and its share of the net profits of the Partnership. There shall be charged against each Partner's capital account the amount of all distributions made by the Partnership to such Partner and its share of the net losses of the Partnership. SECTION 2.03. Profits and Losses. (a) Subject to Section 2.03(b) and (c), the net profits and losses of the Partnership, and each item of income, gain, loss, deduction or credit entering into the computation thereof, shall be allocated between the Partners in accordance with the applicable Participation Percentages. (b) Capital Gains and Losses. Subject to Section 2.03(c), (i) The net gain of the Partnership arising from a sale of all or substantially all the assets of the Partnership or associated with the liquidation of the Partnership (a "Final Capital Event") shall be allocated as follows: (A) first, an amount of gain up to the aggregate negative capital account balances of all Partners who have such negative capital account balances shall be allocated among such Partners in proportion to their negative capital account balances; (B) second, gain shall be allocated to the Partners so as to cause the positive capital account balances of the Partners, as rapidly as possible, to stand in the same proportions to each other as the Partners' Participation Percentages bear to each other; (C) third, any additional gain shall be allocated to the Partners in proportion to the Partners' Participation Percentages. (ii) The net losses of the Partnership arising from a Final Capital Event of the Partnership shall be allocated as follows: (A) first, if more than one Partner has a positive capital account balance, loss shall be allocated to the Partners with positive capital account balances until the positive account balances of the Partners stand in the same proportions to each other as the Partners' Participation Percentages bear to each other; (B) second, an amount of loss up to the aggregate positive capital amount balances of all Partners who have such positive capital account balances shall be allocated among such Partners in proportion to their positive capital account balances; (C) third, loss shall be allocated to the Partners so as to cause the negative capital account balances of the Partners, as rapidly as possible, to stand in the same proportions as the Partners' Participation Percentages bear to each other; (D) fourth, any additional loss shall be allocated to the Partners in proportion to the Partners' Participation Percentages. (c) Section 704(b) Requirements. Notwithstanding Section 2.03(a) and (b), it is the intention of the Partners to conform the allocation of Profits and Losses in this Agreement to the requirements of Treas. Reg. sec. 1.704-1(b). Accordingly, (i) if the allocation of any Net Loss of the Partnership for any fiscal year pursuant to Section 2.02(a) or (b) would cause a Partner to have a negative capital account balance which exceeds such Partner's share of the Partnership's minimum gain (within the meaning of Treas. Reg. sec. 1.704-1(b)(iv)(f)) at the end of such fiscal year, the portion of such Net Loss that would have such result shall instead be specially allocated to the other Partners to the extent of such other Partners' positive capital account balances; (ii) items of Partnership income and gain shall be specially allocated to any Partner with a negative capital account balance to the extent required by the "qualified income offset" requirement of Treas. Reg. sec. 1.704-1(b)(2)(ii)(d); (iii) if the Partnership should incur any debt, Partners shall be allocated items of income and gain as required to satisfy the "minimum gain chargeback" requirement of Treas. Reg. sec. 1.704-1(b)(4)(iv)(e); and (iv) all items of loss or deduction attributable to nonrecourse debt of the Partnership owed to a Partner shall be allocated to the lending Partner to the extent required by Treas. Reg. sec. 1.704-1(b)(4)(iv)(g) and appropriate corresponding allocations shall be made of income or gain attributable to the repayment of such debt. (d) Net Income and Net Loss Defined. "Net Income" and "Net Loss" for any fiscal year shall be the net income and net loss of the Partnership for such fiscal year for Federal income tax purposes, increased by the amount of any tax-exempt income of the Partnership during such Fiscal Year and decreased by expenditures of the Partnership described in Section 705(a)(2)(B) of the Internal Revenue Code of 1986, as amended; provided, however, that, if any Partner contributes property the basis of which (for Federal income tax purposes) differs from its fair market value on the date of contribution ("704(c) Property"), depreciation, amortization, and gain and loss with respect to such Section 704(c) Property shall be computed using such fair market value as its initial basis to the Partnership in accordance with the requirements of Section 704(b) of the Code and the Regulations thereunder. (e) Allocation of Net Income and Net Loss for Federal Income Tax Purposes. The net income and net loss of the Partnership for Federal income tax purposes shall be allocated among the Partners in the same proportion as the Net Income and Net Loss of the Partnership are allocated pursuant to this Section 2.03; provided that Federal income tax items relating to Section 704(c) Property shall be allocated among the Partners in accordance with Section 704(c) principles as required by Sections 704(b) and 704(c) of the Code. SECTION 2.04. Distributions. Distributions of cash in excess of the reasonable business needs of the Partnership, and distributions of interests in real estate, securities and other noncash assets held by the Partnership, shall be made at such times and in such aggregate amounts as the Partners may from time to time determine. Distributions of cash or other assets shall be allocated between the Partners in accordance with their Participation Percentages. The Partners contemplate that cash in excess of the reasonable business needs of the Partnership shall be distributed as soon as practicable. Interests in real estate, securities and other noncash assets shall be distributed on the basis of their fair market value at the time of distribution. ARTICLE III Management of the Partnership SECTION 3.01. Management. (a) The business and affairs of the Partnership shall be managed jointly by both Partners and all decisions to be made by the Partnership shall require the approval of both Partners. Neither Partner shall take any action on behalf, or in the name, of the Partnership unless the other Partner has given its consent to, or approval of, such action. (b) With respect to all of their obligations, powers and responsibilities under this Agreement, the Partners are authorized to execute and deliver jointly, for and on behalf of the Partnership, such notes and other evidences of indebtedness, contracts, agreements, assignments, deeds, leases, loan agreements, mortgages and other security instruments and agreements as they both deem proper, all on such terms and conditions as they both deem proper. (c) Any person dealing with the Partnership or the Partners may rely upon a certificate signed by either Partner concerning (i) the identity of either Partner; (ii) the existence or nonexistence of any fact or facts that constitute a condition precedent to acts by a Partner or that concern the affairs of the Partnership; (iii) the persons who are authorized to execute and deliver any instrument or document of or on behalf of the Partnership; or (iv) any act or failure to act by the Partnership or as to any other matter whatsoever involving the Partnership or either Partner. SECTION 3.02. Services of the Partners. Each Partner shall devote such time and effort to the Partnership's business as is reasonably necessary to carry out the purposes of the Partnership and to promote the mutual interests of the Partners; provided, however, that the Partners shall not be required to devote their full time to Partnership business and may at any time and from time to time engage in and possess an interest in other business ventures as provided in Section 1.08. SECTION 3.03. Liability and Indemnification. (a) Neither Partner shall be liable, responsible or accountable in damages or otherwise to the Partnership or the other Partner for any act or omission performed or omitted by it in good faith on behalf of the Partnership and in a manner reasonably believed by it to be within the scope of the authority granted to it by this Agreement and in the best interests of the Partnership unless it shall have been guilty of gross negligence or wilful misconduct with respect to such act or omission. (b) Each Partner shall be indemnified by the Partnership for any act performed by it within the scope of the authority conferred upon it by this Agreement; provided, however, that such indemnity shall be payable only if such Partner (i) acted in good faith and in a manner it reasonably believed to be in, or not opposed to, the best interests of the Partnership and the Partners and (ii) had no reasonable grounds to believe that its conduct constituted gross negligence or was unlawful. Any act or omission performed or omitted by the Partners on advice of legal counsel or an independent consultant shall be conclusively deemed to have been performed or omitted in good faith and not an act of gross negligence. Any indemnity under this Section 3.03 shall be paid from, and only to the extent of, Partnership assets and neither Partner shall have any personal liability on account thereof. ARTICLE IV Books, Records and Bank Accounts SECTION 4.01. Books and Records. The Partners shall keep true and correct books of account with respect to the operations of the Partnership. Such books shall be maintained at the principal place of business of the Partnership, or at such other place as the Partners shall determine, and both Partners and their duly authorized representatives shall at all reasonable times and on reasonable notice to the Partnership have access to such books. SECTION 4.02. Accounting Basis and Fiscal Year. Such books shall be kept on the accrual method of accounting, or on such other method of accounting as the Partners may determine, and shall be closed and balanced at the end of each year of the Partnership. The fiscal year of the Partnership shall be the calendar year or such other period as determined by both Partners. ARTICLE V Assignment of Interests and Admission of New Partners SECTION 5.01. Assignment of a Partner's Interest. Except as provided in Article VI, neither Partner may sell, transfer, assign, pledge or otherwise dispose of all or any part of its interest in the Partnership unless both Partners shall have consented to such disposition in writing. SECTION 5.02. Admission of Assignee into Partnership. Subject to the provisions of Section 5.01 and to the terms of any instrument, letter or memorandum of assignment executed and delivered pursuant to Section 5.01, an assignee of all or part of the interest of a Partner shall be admitted as a Partner of the Partnership, entitled to all the rights and subject to all the obligations of a Partner hereunder, upon the execution and delivery by the assignee of such documents and instruments as the Partners may deem necessary or desirable to confirm the agreement of the assignee to be bound by all the terms and provisions of this Partnership Agreement. SECTION 5.03. Admission of Additional Partners. The Partners may from time to time, for such contributions to the capital of the Partnership and on such other terms as they may deem appropriate, admit one or more additional Partners into the Partnership. Any such additional Partner shall be admitted as a Partner of the Partnership, entitled to all the rights and subject to all the obligations of a Partner hereunder upon the execution and delivery by the additional Partner of such documents and instruments as the Partners may deem necessary or desirable to confirm the agreement of the additional Partner to be bound by all the terms and provisions of this Agreement. ARTICLE VI Transfers and Withdrawal or Disability of a Partner SECTION 6.01. Withdrawal or Disability of a Partner. (a) A Partner may withdraw from the Partnership by giving written notice thereof to each other Partner not less than 30 days prior to the effective date of withdrawal stated in such notice. (b) A Partner shall be deemed to have withdrawn from the Partnership in the event and on the date that such Partner files a voluntary petition in bankruptcy, is adjudicated as bankrupt or insolvent, files any petition or answer seeking any reorganization, arrangement, readjustment, liquidation, dissolution or similar relief under the Bankruptcy Code, as from time to time amended, or any other applicable Federal, state or other statute or law regarding bankruptcy, insolvency or other relief for debtors, or seeks, consents or acquiesces in the appointment of any trustee, receiver, conservator or liquidator of itself or all or any substantial portion of its property. SECTION 6.02. Effect of Withdrawal. The withdrawal of a Partner shall not effect the dissolution of the Partnership, which shall be continued by the remaining Partner. The interest of a withdrawing Partner (or of its trustee, receiver or other legal representative, as the case may be, referred to herein as such Partner's "Distributee") in the Partnership shall be limited as provided in Section 6.03 and shall be subject to the provisions of Section 6.04. SECTION 6.03. Withdrawing Partner's Distributions. (a) Subject to Section 6.04, from and after the effective date of the withdrawal of any Partner, the withdrawing Partner, or his Distributee, shall have the status of an assignee of the interest in the Partnership held by such Partner and shall only be entitled to receive the share of net profits, net losses and distributions of the Partnership in accordance with the Participation Percentage of such Partner. (b) Until distributed as herein provided, all assets to which a withdrawing Partner or his Distributee may be entitled hereunder shall remain at the risk of the Partnership's business and shall be considered as assets and capital of the Partnership in the same manner and to the same extent as contributions by Partners to the capital of the Partnership, and any claims of such withdrawing Partner or his Distributee to such assets shall be subordinate in right of payment and subject to the prior payment or provision for payment in full of claims of all present or future creditors of the Partnership. SECTION 6.04. Buy/Sell. (a) At any time after the date hereof, either Partner shall have the right as an initiating Partner (the "Initiating Partner") to cause the Partnership to sell the Property by delivery to the other Partner (the "Responding Partner") of a notification (the "Buy/Sell Notification") making an offer to purchase the Property for a cash price specified in such Buy/Sell Notification (the "Buy/Sell Price"). The Buy/Sell Notification shall (i) advise the Responding Partner that the Initiating Partner is willing to purchase the Property; (ii) state the Buy/Sell Price proposed by the Initiating Partner; (iii) set forth the other material terms of the purchase and state who will pay for documentary stamp and transfer taxes, if any, and other costs of closing (the "Other Buy/Sell Terms"); and (iv) give the Responding Partner the following options: (x) to cause the Partnership to sell the Property to the Initiating Partner at the Buy/Sell Price and upon the Other Buy/Sell Terms, (y) to cause the Partnership to use its best efforts to sell the Property to a third party at no less than the Buy/Sell Price and upon terms no less favorable to the Partnership than the Buy/Sell Terms, or (z) to purchase the Property at the Buy/Sell Price and upon the Other Buy/Sell Terms. (b) Within 30 days after the giving of the Buy/Sell Notification, the Responding Partner shall give notice to the Initiating Partner to the effect that: (i) the Responding Partner has elected to purchase the Property; (ii) the Responding Partner wishes the Property sold to a third party pursuant to clause (y) of Section 6.04(a); or (iii) the Responding Partner does not wish to purchase the Property and that it elects to cause the Partnership to sell the Property to the Initiating Partner. If the Responding Partner does not give notice to the Initiating Partner in answer to the Buy/Sell Notification within such 30 days, the Responding Partner shall be deemed to have given the answer set forth in clause (iii) above. (c) The closing of any purchase and sale of the Property pursuant to Section 6.04(b)(i) or (iii) shall take place at the Partnership's office (or such other office as may be agreed upon by the Initiating Partner and the Responding Partner) not later than 60 days after the Responding Partner gives the written notice to the Initiating Partner or such written notice is deemed to have been given. Any sale of the Property pursuant to Section 6.04(b)(ii) shall be consummated as soon as reasonably practicable. At any closing under Section 6.04(b), the Partnership and the Partners shall execute and deliver such instruments as shall be appropriate to transfer the Property to the purchaser, the purchaser shall simultaneously pay to the Partnership the Buy/Sell Price, the Partnership, the Partners and the purchaser shall perform the Other Buy/Sell Terms to be performed by them, and the Partnership shall thereupon distribute the Buy/Sell Price as provided in Section 2.04 hereof. In connection with any such purchase and sale, the purchaser shall have the right upon closing as herein contemplated to admit as Partner(s) one or more persons or entities and make amendments to this Agreement in connection therewith. (d) In the event a purchasing Partner under this Section 6.04 fails to fulfill its obligation to purchase the Property, then the selling Partner may, at any time for a period of 120 days after such default, cause the Partnership to sell the Property to any person (including such selling Partner) at a price and upon other terms no less favorable than those set forth in the Buy/Sell Notification. SECTION 6.05. First Refusal Rights. (a) If either Partner shall desire to sell all but not less than all its interest in the Partnership to a third party, then the Partner desiring to sell as aforesaid (the "Selling Partner") shall obtain a bona fide written offer from such third party. The Selling Partner shall thereupon give notice to the other Partner (the "Nonselling Partner") of such offer, setting forth the identity of such third party, the sale price (which shall be payable only in cash or purchase money obligations, which may be secured solely by the interest being sold) and the terms and conditions upon which the third party is willing to purchase the interest being offered for sale, and offer to sell such interest to the Nonselling Partner on such terms and conditions. The Nonselling Partner shall then have 20 days within which to give notice to the Selling Partner that it wishes to acquire the interest offered for sale on such terms and conditions. Such notice from the Nonselling Partner shall state a closing date not later than the closing date specified in the offer from the third party or 60 days after the date of such notice, whichever is later. If the Nonselling Partner shall not give notice within the 20-day period following the initial notice from the Selling Partner that it wishes to acquire the interest, the Selling Partner may sell its interest to such third party during the period on or prior to the closing date set forth in the notice, or, if no closing date was set forth, within 90 days of such notice, and only on terms and conditions no less favorable to the Selling Partner than those set forth in the original offer; provided, however, that (i) not less than 20 days prior to the execution of any proposed contract of sale to any such third party, the Selling Partner shall give notice to the Nonselling Partner of the name and address of such third party and provide therewith any available information with respect to the relevant experience and financial condition of such third party and, if within 15 days from the date on which such notice is given the Nonselling Partner shall give notice to the Selling Partner that it reasonably objects to the proposed sale to such third party, the Selling Partner may not sell its interest in the Partnership to such third party and (ii) nothing contained herein shall be construed to preclude the Selling Partner from presenting to the Nonselling Partner in advance a list of prospective purchasers and requesting a waiver of the rights of the Nonselling Partner set forth in the foregoing proviso with respect to any sale to any of the persons on such list; and provided further, however, that such third party shall agree in writing to be subject to and to assume the terms, conditions, obligations and liabilities of this Agreement. (b) If the Nonselling Partner fails to fulfill the obligation to purchase such interest of the Selling Partner in the Partnership on the same terms and conditions as those contained in the offer after giving notice that such purchase will be made, then, in addition to all other remedies available, the Selling Partner may, at any time for a period of 120 days after such default, sell such interest in the Partnership to any person at any price and upon any other terms. ARTICLE VII Dissolution and Termination SECTION 7.01. Events of Dissolution. (a) The Partnership shall be dissolved on the earliest of (i) a date agreed to by both Partners, (ii) subject to Section 6.02, the occurrence of any event specified under the laws of the State of California as one effecting dissolution or (iii) December 31, 2044. (b) Dissolution of the Partnership shall be effective on the day on which the event giving rise to the dissolution occurs, but the Partnership shall not terminate until the affairs of the Partnership shall have been wound up and the assets of the Partnership shall have been distributed as provided herein. Notwithstanding the dissolution of the Partnership, prior to the termination of the Partnership, as aforesaid, the business of the Partnership and the affairs of the Partners, as such, shall continue to be governed by this Agreement. SECTION 7.02. Distributions upon Liquidation. After payment or provision for all Partnership liabilities, the remaining net assets of the Partnership shall be distributed among the Partners as provided in Section 2.04. ARTICLE VIII Miscellaneous SECTION 8.01. Notices. Any and all notices, elections or demands permitted or required to be made under this Agreement shall be in writing, signed by the Partner giving such notice, election or demand and shall be delivered personally, or sent by registered or certified mail, to the other Partner or Partners at the addresses specified in Schedule A or at such other addresses as may be supplied by written notice given in conformity with the terms of this Section 8.01. The date of personal delivery or five days after mailing, as the case may be, shall be the date of such notice (if given in accordance with this Section 8.01). SECTION 8.02. Successors and Assigns. Subject to the restrictions on transfers set forth herein, this Agreement, and each and every provision hereof, shall be binding upon and shall inure to the benefit of the Partners, their respective successors, successors-in-title and assigns, and each and every successor-in-interest to any Partner, whether such successor acquires such interest by way of purchase, foreclosure or by any other method, shall hold such interest subject to all the terms and provisions of this Agreement. SECTION 8.03. Amendment. This Agreement may be changed, modified or amended only by an instrument in writing duly executed by both Partners. SECTION 8.04. No Waiver. The failure of any Partner to insist upon strict performance of a covenant hereunder or of any obligation hereunder, irrespective of the length of time for which such failure continues, shall not be a waiver of such Partner's right to demand strict compliance in the future. No consent or waiver, express or implied, to or of any breach or default in the performance of any obligation hereunder shall constitute a consent or waiver to or of any other breach or default in the performance of the same or any other obligation hereunder. SECTION 8.05. Entire Agreement. This Agreement constitutes the full and complete agreement of the parties hereto with respect to the subject matter hereof. SECTION 8.06. Captions. Titles or captions of Articles or Sections contained herein are inserted only as a matter of convenience and for reference, and in no way define, limit, extend or describe the scope hereof or the intent of any provision hereof. SECTION 8.07. Counterparts. This Agreement may be executed in any number of counterparts, all of which together shall for all purposes constitute one Agreement, binding on all the Partners. SECTION 8.08. Applicable Law. This Agreement and the rights and obligations of the parties hereunder shall be governed by and interpreted, construed and enforced in accordance with the laws of the State of California. DEAN WITTER REALTY YIELD PLUS, L.P., a Delaware limited partnership, by DEAN WITTER REALTY YIELD PLUS INC., a Delaware corporation, Managing General Partner, by E. Davisson Hardman, Jr. Senior Vice President DEAN WITTER REALTY YIELD PLUS II, L.P., a Delaware limited partnership by DEAN WITTER REALTY YIELD PLUS II INC., a Delaware corporation, Managing General Partner, by E. Davisson Hardman, Jr. Senior Vice President SCHEDULE A Dated as of March 14, 1988 DW MICHELSON ASSOCIATES Capital Contributions and Participation Percentages Name and Capital Participation Address of Partner Contribution Percentage __________________ ____________ _____________ Dean Witter Realty Yield Plus, L.P. In care of Dean Witter Realty Yield Plus Inc. 130 Liberty Street New York, N.Y. 10006 $41,000,000 73.2306043699% Dean Witter Realty Yield Plus II, L.P. In care of Dean Witter Realty Yield Plus II Inc. 130 Liberty Street New York, N.Y. 10006 14,987,521 26.7693956301 $55,987,521 100% EX-10 3 Exhibit (10)(e) _______________ FIRST AMENDMENT TO CONSTRUCTION LOAN AGREEMENT This First Amendment to Construction Loan Agreement (the "First Amendment") entered into as of the 12th day of October, 1989 among Richard H. Rubin, Myrna Putziger and Jonathan D. Albert as Trustees of Government Center Garage Realty Trust under declaration of trust dated November 1, 1983 and recorded in the Suffolk County Registry of Deeds in Book 10615, Page 58 (the "Borrower"), and Dean Witter Realty Yield Plus, L.P., a Delaware limited partnership and Dean Witter Realty Yield Plus II, L.P., a Delaware limited partnership (together the "Lender"). RECITALS 1. The Lender has made a loan to the Borrower in the original principal sum of up to $57,700,000 (the "Loan") pursuant to a Loan Agreement dated as of April 26, 1989 (the "Loan Agreement"). All defined terms used herein and not otherwise defined shall have the meaning assigned to them in the Loan Agreement. 2. The parties are entering into this First Amendment to modify the term of the Office Loan and to amend certain definitions set forth in Schedule A of the Loan Agreement. AMENDMENTS 1. Section 3.3 of the Loan Agreement is deleted and the following is inserted in place thereof: Term. The term of the Office Loan shall commence on the date the Construction Loan is converted to the Office Loan and terminate on the Office Loan Maturity Date. 2. Schedule A to the Loan Agreement is amended as follows: A. The defined term "Note" and the definition associated therewith on page 7 of Schedule A is deleted and the following is inserted in place thereof: "Note" means together, (i), the Amended and Restated Construction Loan/Office Loan Promissory Note (Yield Plus) of even date herewith, from Borrower to Dean Witter Realty Yield Plus, L.P. and (ii) the Amended and Restated Construction Loan/Office Loan Promissory Note (Yield Plus II) of even date herewith, from Borrower to Dean Witter Realty Yield Plus II, L.P. B. The defined term "Office Loan Maturity Date" and the definition associated therewith on page 8 of Schedule A is deleted and the following is inserted in place thereof: "Office Loan Maturity Date" means November 1, 2001. 3. Except to the extent modified herein, the terms of the Loan Agreement remain in full force and effect. IN WITNESS WHEREOF the parties hereto have caused this First Amendment to be executed by their duly authorized officers as of the day and year first written above. BORROWER: Richard H. Rubin, as trustee of the Government Center Garage Realty Trust and not individually Myrna Putziger, as trustee of Government Center Garage Realty Trust and not individually Jonathan D. Albert, trustee of Government Center Garage Realty Trust and not individually LENDER: Dean Witter Realty Yield Plus, L.P. By: Dean Witter Realty Yield Plus Inc., general partner /S/Warren B. Lane By: ________________________ Warren B. Lane Senior Vice President By: Dean Witter Realty Yield Plus Associates, L.P., general partner By: Dean Witter Realty Yield Plus, Inc., general partner /s/Warren B. Lane By: _______________________ Warren B. Lane Senior Vice President Dean Witter Realty Yield Plus II, L.P. By: Dean Witter Realty Yield Plus II Inc., general partner /s/Warren B. Lane By: ________________________ Warren B. Lane Senior Vice President By: Dean Witter Realty Yield Plus Associates II, L.P., general partner By: Dean Witter Realty Yield Plus II Inc., general partner /s/Warren B. Lane By: _____________________ Warren B. Lane Senior Vice President Exhibit (10)(f) ______________ AMENDED AND RESTATED CONSTRUCTION LOAN/OFFICE LOAN PROMISSORY NOTE (YIELD PLUS)* $57,700,000 As of October 12, 1989 FOR VALUE RECEIVED, the undersigned, Richard H. Rubin, Myrna Putziger and Jonathan D. Albert, Trustees of Government Center Garage Realty Trust under declaration of trust dated November 1, 1983, recorded in the Suffolk County Registry of Deeds in Book 10615, Page 58, as amended (the "Trust"), having its principal place of business at c/o The Richard H. Rubin Companies, 11200 Rockville Pike, Suite 200, Rockville, Maryland 20852 ("Maker") promises to pay to the order of Dean Witter Realty Yield Plus, L.P., a Delaware limited partnership ("Holder"), having its principal place of business c/o Realty Management Services, Inc. Credit Corporation ("Agent"), Two World Trade Center, New York, New York 10048 the principal sum of FIFTY SEVEN MILLION SEVEN HUNDRED THOUSAND DOLLARS ($57,700,000) or so much thereof as may have been advanced from time to time as evidenced on Schedule A (the "Loan"). In addition, the Maker shall pay interest on the outstanding principal balance of the Loan from time to time from the date hereof until the Loan is paid in full as described below, as well as Additional Interest pursuant to the terms of an Additional Interest Agreement of even date herewith among Maker, Holder and Yield Plus II (as hereinafter defined). The Loan is to be advanced in accordance with the terms of a Loan Agreement among Holder, Maker and Dean Witter Realty Yield Plus II, L.P. ("Yield Plus II") of even date herewith (the "Loan Agreement") and is to be repaid to Holder with interest thereon at the rates, at the times and in the manner hereinafter provided. All capitalized terms used herein without definition will have the meanings set forth in the Loan Agreement. (Holder and Yield Plus II are together referred to herein as the "Lenders" and individually as a "Lender".) ____________________ *The purpose of this Amended and Restated Construction Loan/Office Loan Promissory Note (Yield Plus) is to amend and restate that certain Construction Loan/Office Loan Promissory Note (Yield Plus) to change the Office Loan Maturity Date. From and after the date hereof this Amended and Restated Promissory Note (Yield Plus) and the Amended and Restated Promissory Note (Yield Plus II) shall be the Note, as defined in the Loan Agreement and as referred to in the Loan Documents. The Loan is to be advanced in conjunction with a Loan from Yield Plus II to Maker evidenced by a certain Construction Loan/Office Loan Promissory Note (Yield Plus II) of even date herewith (referred to herein, together with this Note as the "Constructions Notes"). Furthermore, simultaneously herewith each Lender has made a first mortgage loan to Maker evidenced respectively by a First Mortgage Loan Promissory Note (Yield Plus) and a First Mortgage Loan Promissory Note (Yield Plus II) each of even date herewith (together referred to herein as the "First Mortgage Notes"). (The Construction Notes and the First Mortgage Notes are collectively referred to herein as the "Notes"). Pursuant to a certain Intercreditor Agreement of even date herewith between the Lenders (the "Intercreditor Agreement"), the Lenders have agreed that at all times prior to the refinancing of the First Mortgage Loan, upon the funding of each advance by either Lender under the Construction Notes, the amounts indicated as having been advanced by each Lender under the Notes shall be adjusted so that the total amount advanced by each Lender pursuant to its First Mortgage Note shall bear the same proportion to the total amounts advanced by both Lenders pursuant to all of the Notes; and accordingly the same formula shall apply to the Construction Notes. Coincident with disbursement, all Loan advances shall be recorded by Holder and endorsed by Maker on Schedule A. In addition coincident with each advance, any modification in the Loan balance under this Note resulting from (i) the purchase by a Lender of a portion of the outstanding balance of any of the Notes held by the other Lender in order to maintain the proportions described above or (ii) any other purchase of a portion of the outstanding balance under the Notes permitted under the Intercreditor Agreement or hereafter agreed to between the Lenders, shall also be recorded by Holder and endorsed by Maker on Schedule A. The outstanding amount of the Loan as reflected on Schedule A from time to time shall be prima facie evidence of amounts outstanding hereunder. Notwithstanding any provision herein to the contrary, the aggregate maximum principal balance outstanding evidenced by the Construction Notes shall never exceed $57,700,000. Interest shall be computed on the basis of a 365-day year for the actual number of days elapsed. From the date hereof interest only on such principal sum shall be payable monthly, in arrears, on the first day of the month immediately following the date hereof and on the first day of each month thereafter at a rate equal to eight percent (8%) per annum. Unless the Construction Loan is converted to the Office Loan, all unpaid principal and interest shall if not sooner paid, be due and payable on the second anniversary date of the Loan Closing Date (the "Construction Loan Maturity Date"). The Maker may extend the Construction Loan Maturity Date for one additional twelve (12) month period, upon at least thirty (30) days prior written notice and payment of the Construction Loan Extension Fee (the "Construction Loan Extension Period") and provided Maker also extends the Construction Loan Maturity Date of the loan evidenced by the other Construction Note in the manner provided in such note. If the Construction Loan is converted to the Office Loan, all unpaid principal and interest shall, if not sooner paid, be due and payable on November 1, 2001 (the "Office Loan Maturity Date"). Provided, however, that the Holder shall be under no obligation to Maker to so convert the Construction Loan to the Office Loan unless such conversion occurs on or before the Construction Loan Maturity Date, as the same may be extended pursuant to the foregoing paragraph. There shall be no prepayment of this Note, in whole or in part, prior to the thirty-six (36) month period immediately preceding the Office Loan Maturity Date. Maker shall, however, have the right to prepay the entire principal balance of the Office Loan outstanding hereunder, together with all accrued and unpaid interest thereon and all other amounts due hereunder and under the other Construction Note and all other amounts associated with the Loan, (i) during the one-year period commencing thirty-six (36) months prior to the Office Loan Maturity Date, upon payment of a prepayment penalty equal to two percent (2%) of the then outstanding principal balance of the Office Loan, (ii) during the one-year period commencing twenty-four (24) months prior to the Office Loan Maturity Date, upon payment of a prepayment penalty equal to one percent (1%) of the then outstanding principal balance of the Office Loan, and (iii) during the one-year period commencing twelve (12) months prior to the Office Loan Maturity Date, without penalty. Notwithstanding the foregoing, the portions of the Office Loan corresponding to the LSA Contingency Reserve and the LSA Working Capital may be prepaid at any time in whole or in part, without penalty, and if so prepaid, may be readvanced by the Holder for the purposes permitted, and in the manner provided, under the Loan Agreement. In addition, in the event that Maker exercises its right to the Construction Loan Extension Period, such extension request must be accompanied by payment to Holder of the Construction Loan Extension Fee. Payments hereunder shall be made in lawful money of the United States of America at the principal office of the Agent above set forth, or at such other place as the Holder of this Note may from time to time designate by written notice mailed to Maker. If any monthly interest payment provided for herein shall be made after the expiration of five (5) days after the due date thereof, in addition to such payments as are otherwise due and payable hereunder, there shall be immediately due and payable to Holder a late charge of five ($.05) cents for each one ($1.00) dollar of such payment (the "Late Charge") for failure to make prompt payment. The Late Charge shall be secured by the Security Documents referred to hereinafter. All expenditures made by the Holder on account hereof not reimbursed by the Maker within five (5) Business Days after demand, all amounts due under this Note after maturity, and any amounts due if an Event of Default occurs, shall bear interest at a rate per annum of five percent (5%) plus the interest rate then in effect (the "Default Rate") until such amounts as are due are paid to the Holder. This Note is made pursuant to the Loan Agreement, and is secured by the Security Documents each of even date herewith, encumbering certain real and personal property located in Boston, Massachusetts, more particularly described therein, and any other instruments, now or hereafter executed by Maker in favor of Holder, which in any manner constitute additional security for this Note. The occurrence of any of the following events shall constitute a default under this Note (each herein called an "Event of Default"): (a) default in the payment when due of interest or principal or other charges, as herein provided or as provided in the other Construction Note or in the payment when due of any fees or other payments to be made to Holder or Yield Plus II under any of the Loan Documents which default continues for more than five (5) Business Days after the due date; or (b) the occurrence of an Event of Default under any of the Loan Documents. Upon the occurrence of an Event of Default, or at any time thereafter, the entire principal of this Note, irrespective of the maturity date specified herein, together with (a) all accrued and unpaid interest at the Default Rate; (b) a default premium (the "Default Premium") equal to seven percent (7%) of the outstanding principal balance of the Loan; and (c) Late Charges and any other fees, expenses and payments due and payable hereunder or under any of the Loan Documents to Holder shall, at the election of the Holder hereof and immediately upon demand, become immediately due and payable, and in such event the date of demand shall become the Maturity Date. This Note is a negotiable instrument which may be freely assigned, negotiated or pledged by Holder to any person or entity, including, but not limited to, an affiliate of Holder, and Holder may sell participation interests to any person or entity, including, but not limited to, an affiliate of Holder, on such terms as Holder may determine. Notwithstanding the foregoing, the Holder may not assign, negotiate, pledge, or sell any interest in this instrument to any person or entity to whom or to which such a transfer is prohibited pursuant to the Loan Agreement. All Makers, endorsers, guarantors, sureties, accommodation parties hereof and all other persons liable or to become liable for all or any part of this indebtedness, jointly and severally waive diligence, presentment, protest and demand, and also notice of protest, of demand, of nonpayment, of dishonor and of maturity and also recourse to suretyship defenses generally; and they also jointly and severally hereby consent to any and all renewals, extensions or modifications of the terms hereof, including time for payment, and further agree that any such renewal, extension or modification of the terms hereof or the release or substitution of any security for the indebtedness evidenced hereby and any other indulgences shall not affect the liability of any of said parties for the indebtedness evidenced by this Note. Any such renewals, extensions or modifications may be made without notice to any of said parties. The Maker, endorsers, guarantors, sureties, accommodation parties hereof and all other persons liable or to become liable on this Note, agree jointly and severally, to pay all costs of collection, including reasonable attorneys' fees and all costs of suit, in case the unpaid principal sum of this Note, or any payment of interest or installment of principal and interest is not paid when due, or in case it becomes necessary to protect the security for the indebtedness evidenced hereby, or for the foreclosure by the Holder of the Mortgage and other Security Documents, or in the event the Holder is made party to any litigation because of the existence of the indebtedness evidenced by this Note, or because of the existence of the Mortgage or the other Loan Documents, whether suit will be brought or not, and whether through courts of original jurisdiction, as well as in courts of appellate jurisdiction or through a bankruptcy court or other legal proceedings. This Note may not be amended, modified, or changed, nor shall any waiver of any provision hereof be effective, except only by an instrument in writing and signed by the party against whom enforcement of any waiver, amendment, change, modification or discharge is sought. This Note may not be amended, modified or changed unless simultaneously therewith a corresponding amendment, modification or change is made to the other Construction Note. Notwithstanding any provision herein or in any instrument now or hereafter evidencing or securing the indebtedness herein set forth, the total liability of Maker for payments in the nature of interest shall not exceed the limits now imposed by the usury laws of Massachusetts or the jurisdiction governing the provisions of this Note. Notwithstanding any provisions herein with respect to prepayment, if the Maker chooses to make a prepayment in accordance with the terms of the Loan Documents, then at the time of such prepayment, it must prepay the whole outstanding principal balance of the Loan and the loan evidenced by the other Construction Note and all other sums due under the Loan Documents. Except as otherwise provided in the Guaranties, anything contained herein to the contrary notwithstanding, no recourse shall be had for the payment of any amounts provided for hereunder or for any claim based thereon or otherwise in respect thereof or based on or in respect of this Note or any of the other Loan Documents against (i) GCG, GCA, LSA, the Maker, any trustee or beneficiary of the Trust or any partner or any past, present or future subscriber to the partnership interests in GCG, GCA or LSA or (ii) any partner, shareholder, legal representative, heir, estate, successor or assign of any thereof. The foregoing provisions of this paragraph shall not (y) prevent recourse to the Project (as that term is defined in the Loan Agreement) (z) constitute a waiver, release or discharge of any obligation evidenced by this Note, but the same shall continue until paid or discharged, and provided, further, that the foregoing provisions of this paragraph shall not limit the right of any person to name Maker or any transferee of any interest in the Project as a party defendant in any action or suit for repossession of the Project or in the exercise of any other remedy under this Note. Whenever used herein, the words "Maker" and "Holder" shall be deemed to include their respective heirs, personal representatives, successors and assigns. Any notices and other communications required or provided for under this Note shall be in writing and shall be deemed to have been sufficiently given or served for all purposes three Business Days after mailing by registered or certified United States mail, return receipt requested, or one Business Day after delivery to a recognized overnight delivery service for next day delivery, to the following addresses or to such other address as may hereafter be designated by notice as aforesaid: To Maker: Richard H. Rubin, as trustee of Government Center Garage Realty Trust c/o The Richard H. Rubin Companies 11200 Rockville Pike Suite 200 Rockville, MD 20852 with a copy hand-delivered or mailed regular mail to: Melville W. Feldman, Esq. Feldman, Bodansky & Feldman 2019 Que Street, N.W. Washington, DC 20009 and Myrna Putziger, Esq. McCormick & Putziger 265 Franklin Street Boston, MA 02110 and Jonathan D. Albert c/o Albert Bros., Inc. 225 East Aurora Street P.O. Box 1310 Waterbury, Connecticut 06721 To Holder: Ronald J. DiPietro Realty Management Services, Inc., as Agent c/o Dean Witter Realty Inc. Two World Trade Center New York, New York 10048 with a copy hand-delivered or mailed regular mail to: Stephen I. Burr, Esq. Gaston & Snow One Federal Street Boston, MA 02110 This Note shall be construed according to and governed by the laws of Massachusetts, and is intended to take effect as a sealed instrument. This Note may be executed in counterparts and as so executed shall constitute but one Note. Signed in the presence of MAKER: /s/Richard H. Rubin _______________________________ _______________________________ Richard H. Rubin, Trustee of Government Center Garage Realty Trust and not individually Myrna Putziger _______________________________ _______________________________ Myrna Putziger, Trustee of Government Center Garage Realty Trust and not individually /s/Jonathan D. Albert _______________________________ _______________________________ Jonathan D. Albert, Trustee of Government Center Garage Realty Trust and not individually Schedule A to Construction Loan/Office Loan Promissory Note (Yield Plus) Loan Advance/ Purchase of Outstanding Balance of Construction Loan/Office Loan Promissory Portion of Loan Note (Yield Balance Purchased Outstanding Date Plus II) By Yield Plus II Loan Balance 4/26/89 $1,653,864 $1,653,864 5/01/89 197,679 1,851,543 5/15/89 376,970 2,228,513 6/01/89 229,896 2,458,409 6/14/89 657,951 3,116,360 7/01/89 212,771 3,329,131 7/21/89 325,840 3,654,971 7/24/89 47,746 3,702,717 8/01/89 213,926 3,916,643 8/16/89 252,358 4,169,001 Exhibit (10)(g) ______________ SECOND AMENDMENT TO CONSTRUCTION LOAN AGREEMENT THIS SECOND AMENDMENT TO CONSTRUCTION LOAN AGREEMENT (the "Second Amendment") is entered into as of the th day of June, 1990 by and among RICHARD H. RUBIN, MYRNA PUTZIGER AND JONATHAN D. ALBERT AS TRUSTEES OF GOVERNMENT CENTER GARAGE REALTY TRUST under declaration of trust dated November 1, 1983 and recorded in the Suffolk County Registry of Deeds in Book 10615, Page 58, having its principal place of business at c/o The Richard H. Rubin Companies, 11200 Rockville Pike, Suite 200, Rockville, Maryland 20852 (the "Borrower"), and DEAN WITTER REALTY YIELD PLUS, L.P., a Delaware limited partnership ("Yield Plus"), and DEAN WITTER REALTY YIELD PLUS II, L.P., a Delaware limited partnership ("Yield Plus II"), each of the two entities having its principal place of business c/o Realty Management Services, Inc., Two World Trade Center, New York, New York 10048 (Yield Plus and Yield Plus II together, the "Lender"). All defined terms used herein and not otherwise defined shall have the meanings ascribed to them in the Loan Agreement (as defined hereinbelow). WHEREAS, the Lender has made a loan to the Borrower in the original principal sum of up to $57,700,000 pursuant to the provisions of a certain Construction Loan Agreement dated as of April 26, 1989 ("Loan Agreement") as amended by a certain First Amendment to Construction Loan Agreement dated as of October 12, 1989 ("First Amendment"); and WHEREAS, the Borrower and the Lender wish to amend the Loan Agreement further by increasing the Loan amount by $1,500,000; NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Borrower and the Lender agree as follows: 1. Amendment of Loan Agreement. At each of the locations in the Loan Agreement cited hereinbelow, the reference to the dollar amount "$57,700,000" is deleted and is replaced by the dollar amount "$59,200,000": (a) Page 1, line 2; (b) Page 1, line 16; (c) Page 2, Section 1.6.1., line 2; (d) Page 2, Section 1.6.2., line 2; (e) Page 3, Section 1.7., line 2; (f) Page 3, Section 1.7A., line 2; and (g) Page 3, Section 1.7B., line 2. 2. Amendment of Schedule A. On page 3 of Schedule A, in line 2 of the defined term "Construction Loan," the reference to the dollar amount "$57,700,000" is deleted and is replaced by the dollar amount "$59,200,000." 3. Amendment of Exhibit H. Exhibit H is deleted and is replaced by an amended and restated Exhibit H as attached hereto. 4. No Other Amendments. Except as expressly provided in this Second Amendment, all of the terms and conditions of the Loan Agreement shall remain in full force and effect. 5. Miscellaneous. (a) This Second Amendment shall be construed, enforced and governed by the laws of The Commonwealth of Massachusetts. (b) This Second Amendment is intended to take effect as a sealed instrument. (c) This Second Amendment may be executed in counterparts and as so executed shall constitute but one Second Amendment. IN WITNESS WHEREOF the parties hereto have caused this Second Amendment to be executed by their duly authorized officers as of the day and year first written above. BORROWER: Richard H. Rubin, as Trustee of the Government Center Garage Realty Trust and not individually Myrna Putziger, as Trustee of the Government Center Garage Realty Trust and not individually Jonathan D. Albert, as Trustee of the Government Center Garage Realty Trust and not individually LENDER: DEAN WITTER REALTY YIELD PLUS, L.P. By: Dean Witter Realty Yield Plus Inc., general partner /s/Warren B. Lane By: ____________________________ Name: Warren B. Lane Title: Sr. Vice President By: Dean Witter Realty Yield Plus Associates, L.P., general partner By: Dean Witter Realty Yield Plus, Inc., general partner /s/Warren B. Lane By:_________________________ Name: Warren B. Lane Title: Sr. Vice President DEAN WITTER REALTY YIELD PLUS II, L. P. By: Dean Witter Realty Yield Plus II, Inc., general partner /s/Warren B. Lane By:_____________________________ Name: Warren B. Lane Title: Sr. Vice President By: Dean Witter Realty Yield Plus Associates II, L.P., general partner By: Dean Witter Realty Yield Plus II Inc., general partner /s/Warren B. Lane By:____________________________ Name: Warren B. Lane Title: Sr. Vice President Exhibit (10)(h) ________________ FIRST AMENDMENT TO AMENDED AND RESTATED CONSTRUCTION LOAN/OFFICE LOAN PROMISSORY NOTE (YIELD PLUS) THIS FIRST AMENDMENT TO AMENDED AND RESTATED CONSTRUCTION LOAN/OFFICE LOAN PROMISSORY NOTE (YIELD PLUS) (the "First Amendment") is entered into this th day of June, 1990, by and among RICHARD H. RUBIN, MYRNA PUTZIGER AND JONATHAN D. ALBERT AS TRUSTEES OF GOVERNMENT CENTER GARAGE REALTY TRUST under declaration of trust dated November 1, 1983 and recorded in the Suffolk County Registry of Deeds in Book 10615, Page 58, having its principal place of business at c/o The Richard H. Rubin Companies, 11200 Rockville Pike, Suite 200, Rockville, Maryland 20852 (the "Maker"), and DEAN WITTER REALTY YIELD PLUS L.P., a Delaware limited partnership, having its principal place of business c/o Realty Management Services, Inc., Two World Trade Center, New York, New York 10048 (the "Holder"). All defined terms used herein and not otherwise defined shall have the same meanings ascribed to them in the Note and the Loan Agreement (as defined hereinbelow). WHEREAS, the Maker delivered to the Holder a certain Amended and Restated Construction Loan/Office Loan Promissory Note (Yield Plus) on October 12, 1989 (the "Note"), in connection with a certain Construction Loan Agreement dated as of April 26, 1989, as amended by a certain First Amendment to Construction Loan Agreement dated as of October 12, 1989 (which Construction Loan Agreement, as amended, is referred to herein as the "Loan Agreement"); and WHEREAS, pursuant to a certain Second Amendment to Construction Loan Agreement of even date herewith, the parties have agreed to amend the Loan Agreement to increase the Loan amount by $1,500,000; NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereby agree as follows: 1. Amendment of Note. (a) Page 1, paragraph 1, lines 13 and 14, the dollar amount "FIFTY-SEVEN MILLION SEVEN HUNDRED THOUSAND DOLLARS ($57,700,000)" is deleted and is replaced by the dollar amount "FIFTY-NINE MILLION TWO HUNDRED THOUSAND DOLLARS ($59,200,000")." (b) Page 2, the last sentence of the second paragraph, the dollar amount "$57,700,000" is deleted and is replaced by the dollar amount "$59,200,000." 2. No Other Amendments. Except as expressly provided in this First Amendment, all of the terms and conditions of the Note shall remain in full force and effect. 3. Miscellaneous. (a) This First Amendment shall be construed, enforced and governed by the laws of The Commonwealth of Massachusetts. (b) This First Amendment is intended to take effect as a sealed instrument. (c) This First Amendment may be executed in counterparts and as so executed shall constitute but one First Amendment. (d) This First Amendment is entered into by the parties in conjunction with a certain First Amendment to Amended and Restated Construction Loan/Office Loan Promissory Note (Yield Plus II) of even date herewith. IN WITNESS WHEREOF, each of the parties hereto has caused this First Amendment to be executed by its duly authorized officer on the date first written above. WITNESS: MAKER: /s/Richard H. Rubin _______________________________ _______________________________ Richard H. Rubin, Trustee of Government Center Garage Realty Trust and not individually /s/Myrna Putziger _______________________________ _______________________________ Myrna Putziger, Trustee of Government Center Garage Realty Trust and not individually /s/Jonathan D. Albert _______________________________ _______________________________ Jonathan D. Albert, Trustee of Government Center Garage Realty Trust and not individually Exhibit (10)(i) _______________ SUPPLEMENTAL LOAN AGREEMENT This Supplemental Loan Agreement (this "Agreement") dated September 20, 1993 by and among Richard H. Rubin and Myrna Putziger, as trustees under a declaration of trust dated November 1, 1983 and recorded in the Suffolk County Registry of Deeds in Book 10615, Page 58, of GOVERNMENT CENTER GARAGE REALTY TRUST, a Massachusetts nominee trust (together with the beneficiary of such trust, the "Borrower"), having a principal place of business c/o The Richard H. Rubin Companies, 11200 Rockville Pike, Suite 200, Rockville, Maryland 19852, and DEAN WITTER REALTY YIELD PLUS, L.P., a Delaware limited partnership, and DEAN WITTER REALTY YIELD PLUS II, L.P., a Delaware limited partnership (collectively, the "Lender"), each having its principal place of business at Two World Trade Center, New York, New York 10048. W I T N E S E T H : WHEREAS, the Borrower and the Lender executed and delivered that certain Construction Loan Agreement dated as of April 26, 1989 (the "Original Loan Agreement"), that certain First Amendment to Construction Loan Agreement dated as of October 12, 1989 (the "First Loan Amendment") and that certain Second Amendment to Construction Loan Agreement dated as of June 21, 1990 (the "Second Loan Amendment"; the Original Loan Agreement, as amended by the First Loan Amendment, the Second Loan Amendment and by this Agreement, and as the same may be further amended from time to time, is hereinafter referred to as the "Amended Loan Agreement"), pursuant to which, inter alia, the Lender agreed to lend up to an aggregate of Fifty Nine Million Two Hundred Thousand Dollars ($59,200,000) (the "Loan") to the Borrower; and WHEREAS, in connection with the Original Loan Agreement, the Borrower agreed to pay to the Lender, inter alia, Additional Interest, as defined in, and on the terms and conditions set forth in, that certain Additional Interest Agreement dated as of April 26, 1989 by and between the Borrower and the Lender, as amended by that certain First Amendment to Additional Interest Agreement dated as of June 22, 1990 by and between the Borrower and the Lender and as further amended by that certain Second Amendment to Additional Interest Agreement dated the date hereof by and between the Borrower and the Lender (as so amended, and as may be further amended from time to time, the "Amended Additional Interest Agreement"); and WHEREAS, the Borrower and the Lender desire to enter into certain agreements relating to the Loan on the terms and conditions set forth herein; NOW, THEREFORE, in consideration of the premises and of the mutual covenants herein contained, the Borrower and the Lender hereby agree as follows: 1. All capitalized terms used and not defined in this Agreement shall have the meanings ascribed to them in the Amended Loan Agreement. All references in the Amended Loan Agreement to the Additional Interest Agreement are hereby deemed to be references to the Amended Additional Interest Agreement. This Agreement is hereby deemed to be a Loan Document (as defined in the Amended Loan Agreement). 2. As used in the following provisions, the following terms shall have the following respective meanings: (a) The term "Final Advance Date" shall have the meaning set forth in paragraph 5 hereof. (b) The term "Free Rent Period" shall mean the period during which the GSA (as hereinafter defined) is, under Supplemental Lease Agreements dated as of June 20, 1990, September 6, 1990 and February 1, 1991 and that certain letter agreement between the GSA and Borrower dated April 5, 1991, all of which documents constitute part of the GSA Lease (as hereinafter defined), the GSA is entitled to deferred free rent with respect to its space at the Project. Borrower represents and warrants that (X) the Free Rent Period comprises five months and commences on the earlier of (i) August 1, 1994 and (ii) the date described in the first sentence of Section 2 of the Supplemental Lease Agreement dated June 21, 1990 between the Borrower and the GSA and (Y) the amount of deferred free rent to which the GSA is entitled during the GSA Free Rent Period is $2,925,293. (c) The term "GSA" shall mean the General Services Administration of the United States of America. (d) The term "GSA Claim" shall mean those certain claims for additional compensation dated November 26, 1990 and February 28, 1991 filed by the Borrower with the GSA. (e) The term "GSA Claim Resolution" shall mean the occurrence of either (i) the entering into by the Borrower and the GSA of a binding settlement concerning the resolution of the GSA Claim or (ii) the making of a binding, non-appealable judicial (or arbitrative) determination of the GSA Claim. (f) The term "GSA Lease" shall mean that certain lease of a portion of the Project dated December 29, 1989 between the Borrower and the GSA, as such lease has been amended or supplemented by the agreements listed in Exhibit A annexed hereto (the Borrower hereby representing that the lease hereinabove referred to and the agreements listed in Exhibit A constitute all of the agreements here- tofore made between the Borrower and the GSA in respect of the lease of space at the Project to the GSA), and as such lease may be further amended or supplemented from time to time after the date hereof. 3. Notwithstanding any provision to the contrary in any of the Loan Documents, at any time prior to the last day of the Free Rent Period, Borrower may, at its option (but subject to the provisions of the third sentence of this paragraph), deliver to the Lender, to be credited as a payment and/or prepayment, whichever is applicable, of interest installments under the Note (other than Additional Interest (as defined in the Amended Additional Interest Agreement)) due during the Free Rent Period (such interest being hereinafter referred to as "Free Rent Period Interest"), any funds of Borrower then on hand (including, without limitation, any cash reserves or working capital). Any such prepayment shall be deemed to have been made in an amount equal to the sum of (x) the amount of funds delivered to the Lender on account of such prepayment and (y) the amount of interest, at a rate of 5% per annum, that would be earned on such funds from the date such prepayment is made until the due date or dates of the installment or installments of Free Rent Period Interest to which such prepayment is applied in accordance with the following provisions of this paragraph 3. If, pursuant to the GSA Claim Resolution, the Borrower receives one or more payments from the GSA on account of the GSA Claim prior to the last day of the Free Rent Period, each such payment (a "GSA Payment") shall, promptly upon receipt, be forwarded to the Lender and credited as a payment and/or prepayment, whichever is applicable, of Free Rent Period Interest, but only to the extent that such interest has not previously been paid or prepaid pursuant to this paragraph 3. Any such prepayment shall be deemed to have been made in an amount calculated in accordance with the formula set forth in the second sentence of this paragraph 3. Any payments and prepayments of Free Rent Period Interest made pursuant to this paragraph 3 shall be applied against installments of Free Rent Period Interest in the order in which the same are due and payable. 4. During the Free Rent Period, provided that (a) there is no outstanding Event of Default, (b) Borrower shall have either (1) theretofore made no Borrower Distributions (as hereinafter defined) or (2) if it has made Borrower Distributions, theretofore deposited into the Project's working capital account from funds other than Project revenues an amount equal to the sum of all Partner Distributions (as hereinafter defined) theretofore made, (c) at such time Borrower shall have expended all of its funds then on hand (including, without limitation, all funds in any cash, working capital and any other reserves and all amounts deposited pursuant to subclause (2) of the foregoing clause (b)), and (d) Borrower complies with the provisions of the immediately succeeding sentence, the Lender shall be obligated, within five (5) Business Days after the Borrower so requests, but not more than once in any calendar month, to make Loan advances in the amount necessary for the Borrower to pay all expenses then due and payable in connection with the ownership and operation of the Project (including, without limitation, debt service on the First Mortgage and the Loan); provided, however, that in no event shall advances required to be made pursuant to this paragraph 4 exceed, in the aggregate, $1,713,068 (the "Remaining Loan Amount"), the parties hereby agreeing and acknowledging that the Remaining Loan Amount constitutes the entire unadvanced portion of the Loan, and that the Lender's only remaining obligation to make Loan advances is as set forth in this paragraph 4 and in paragraph 5 hereof. Whenever the Borrower so requests an advance hereunder, it shall be obligated, prior to or simultaneously with such request, to make the deposit described in subclause (2) of clause (b) of the immediately preceding sentence, if applicable, and to provide the Lender with evidence of such deposit. Each request for an advance hereunder (a) shall be accompanied by a schedule certified as true and correct by the general partner of the Borrower showing, in reasonable detail, the expenses on account of which such request is being made, which expenses must either conform to the budget for the Project then in effect (which budget shall have been previously approved by the Lender, such approval not to be unreasonably withheld) or be approved by the Lender, such approval not to be unreasonably withheld, and (b) shall not be on account of any expenses covered by a previous request for an advance hereunder. As used herein, "Borrower Distributions" shall mean, collectively, Partner Distributions and Lender Distributions (as each such term is hereinafter defined). As used herein, "Partner Distributions" shall mean any distributions or payments of cash by the Borrower from and including the date hereof until and including the Final Advance Date to or for the account of any of its then current or former partners or to any affiliate of its then current or former partners, whether on account of partnership distributions, Partner Loans (as defined in the Partnership Agreement) or any other loans to the Borrower, fees, line items in the construction budget provided for in the Amended Loan Agreement, or otherwise, but excluding property management fees to affiliates of Government Center Garage Associates Limited Partnership in amounts set forth on Exhibit A attached hereto and made a part hereof, and "Lender Distributions" shall mean any payments by the Borrower to the Lender pursuant to the last sentence of paragraph 5.3 hereof. 5. On the day (the "Final Advance Date") which is the earlier of (i) the last day of the Free Rent Period and (ii) the date on which all Free Rent Period Interest shall have been prepaid or paid pursuant to paragraph 3 hereof, the following shall occur: (a) Provided that there is then no outstanding Event of Default, and subject to the first sentence of paragraph 5.3 below, Lender shall make a Loan advance to the Borrower in the amount, if any, by which (x) the Remaining Loan Amount, exceeds (y) the sum of all Loan advances previously made by the Lender pursuant to paragraph 4 hereof (such excess being hereinafter referred to as the "Final Loan Amount"). (b) Subject to the retention by the Borrower of cash reserves and working capital to the extent permitted by the Amended Additional Interest Agreement, all funds of the Borrower on hand as of the Final Advance Date (including, for this purpose and without limitation, (a) proceeds of the Loan advance to be made pursuant to paragraph 5.1 hereof without deduction for the retained amounts described in the first sentence of paragraph 5.3 below and (b) GSA Payments) shall be payable (and paid) on the Final Advance Date as follows and in the following order of priority: (i) Such funds, up to the total amount of all GSA Payments theretofore received (whether paid monthly or otherwise), shall first be payable to the Borrower and the Lender in accordance with Section 2(a) of the Amended Additional Interest Agreement (including that portion of such Section requiring payment of the Priority Amount, as such term is used therein, for each calendar year on account of which such funds are payable as hereinafter provided in this subparagraph 5.2.1, but only, in the case of calendar year 1993, to the extent that the Priority Amount was not theretofore paid in accordance with the last sentence of paragraph 5.3 hereof) as if the Accrual Date, as such term is used in the Amended Additional Interest Agreement, were January 1, 1993 and as if such payments made by the GSA were Adjusted Gross Receipts, as such term is used in the Amended Additional Interest Agreement, in the calendar year(s) in which they were made; (ii) The balance of such funds, up to the Remaining Loan Amount, shall be payable 50% to the Lender and 50% to the Borrower; (iii) The balance of such funds, up to the amount of $951,267.41, shall be payable 50% to the Lender and 50% to the Borrower; and (iv) The remaining balance of such funds shall be payable to the Borrower and the Lender in accordance with Section 2(a) of the Amended Additional Interest Agreement (including that portion of such Section requiring payment of the Priority Amount) as if the Accrual Date, as such term is used in the Amended Additional Interest Agreement, were January 1, 1993 and as if such funds were Adjusted Gross Receipts in calendar year 1993. (c) The parties acknowledge and confirm that the amounts payable to the Lender pursuant to subsections 5.2.1 through 5.2.4 above, up to the Final Loan Amount, shall, rather than be paid to the Lender at the time of the Loan advance described in paragraph 5.1 above, be retained by the Lender, and not advanced to the Borrower pursuant to paragraph 5.1, in full satisfaction of the Borrower's obligation, pursuant to subsections 5.2.1 through 5.2.4 above, to pay such retained amounts to the Lender. The Borrower agrees that if the Borrower makes a Borrower Distribution prior to the Final Advance Date, the amount thereof shall be paid to the Borrower as a Partner Distribution and to the Lender as a Lender Distribution in accordance with Section 2(a) of the Amended Additional Interest Agreement (including the portion of such Section requiring payment of the Priority Amount, as such term is used therein) as if the Accrual Date, as such term is used in the Amended Additional Interest Agreement, were January 1, 1993 and as if such funds were adjusted Gross Receipts, as such term is used in the Amended Additional Interest Agreement, in the calendar year 1993. 6. Borrower represents and warrants that as of the date hereof, there are no outstanding Partner Loans (as defined in the Partnership Agreement) that were made by or on behalf of Government Center Garage Associates Limited Partnership. 7. The following sentence is hereby added to Exhibit F of the Amended Loan Agreement: "The beneficial interest of Edward J. McCormack, Jr. in said Putnam Associates Realty Trust has been pledged to Wainwright Bank as security for a loan having an original principal balance of $1,750,000. 8. The Lender acknowledges and confirms that (a) the Core and Shell Substantial Completion Date has occurred, (b) the Shortfall Guaranty has terminated and is no longer of any force and effect and (c) except with respect to the rehabilitation of the elevators serving the parking garage portion of the Project, the Completion and Cost Overrun Guaranty has terminated and is no longer of any force and effect. 9. The Borrower shall not hire, engage or enter into any contracts with Jonathan D. Albert ("Albert"), Warren B. Lane, John J. Preotle, Jr. or any immediate family member of any of them, or any entity that any of the foregoing persons has any right, title or interest of any kind whatsoever, direct or indirect, in or to, without the Lender's prior written consent, which consent may be withheld at Lender's sole discretion. The foregoing, however, shall not be deemed to (i) prohibit an entity affiliated with Albert from entering into a lease of Project space on commercially reasonable terms for such entity's own use as an office or (ii) prohibit Albert from acting as a consultant or agent in any capacity (including in connection with the Project) for The Rubin Companies, Richard H. Rubin or any family member of Richard H. Rubin or any entity in which Richard H. Rubin has an interest, other than directly with the Borrower, provided that: (X) Any compensation which Albert receives for such consulting or agency services shall not be paid by the Borrower or otherwise from the revenues of the Project (whether as a fee or operating expense or distribution or other direct or indirect charge or payment of any kind whatsoever, but excluding partnership distri- butions which have previously been paid from Project revenues); provided, however, that Albert may be compensated by the Borrower or otherwise out of Project revenues for consulting services rendered with respect to the GSA Claim and the Borrower's dispute with Stolte Inc. relating to the construction of the Project (and not with respect to any other matters), provided that such compensation is on commercially reasonably terms; (Y) Albert shall not in connection with the Project render on a regular basis services customarily performed by the property manager of the Project, or otherwise be entitled to share directly in the payment of property management fees payable in connection with the Project; and (Z) Albert shall not render advisory or other services in connection with any negotiations, communications, disputes or litigation between the Lender and the Borrower, or any question or matter involving the Borrower's and/or the Lender's compliance with or rights under the terms of the Loan. 10. The Borrower hereby acknowledges and confirms that as of the date hereof, (a) the outstanding unpaid principal balance of the Note is $57,486,932 and (b) to the best of its knowledge, it has no defenses, offsets or counterclaims to its obligations under, and no causes of action with respect to, the Note and the other Loan Documents. The Lender hereby acknowledges and confirms that to the best of its knowledge, as of the date hereof no Event of Default exists and no event has occurred and no condition exists which, with the giving of notice or the lapse of time or both, would constitute an Event of Default. 11. The definition of "Break-even Date" in Schedule A of the Amended Loan Agreement is hereby amended to read in its entirety "January 1, 1993". 12. Pursuant to Section 8.1.5 of the Amended Loan Agreement, the Lender hereby expressly consents to the assignment by LSA of its entire interest in GCG to GCA and Rubin pursuant to an Assignment of Partnership Interests of even date herewith, and to the withdrawal of LSA as a general partner of GCG. 13. The Lender and the Borrower hereby agree that their respective addresses for notice under each of the Loan Documents are changed to the following: To the Borrower: Richard H. Rubin, as trustee of Government Center Garage Realty Trust c/o The Richard H. Rubin Companies 11200 Rockville Pike Suite 200 Rockville, MD 20852 with a copy to: Feldman, Bodansky & Rubin 1819 L Street, N.W. Seventh Floor Washington, D.C. 20036 Attention: Steven K. Rubin, Esq. and Rubin and Rudman 50 Rowes Wharf Boston, Massachusetts 02110 Attention: Myrna Putziger To the Lender: Dean Witter Realty Yield Plus, L.P. and Dean Witter Realty Yield Plus II, L.P c/o Dean Witter Realty Inc. 64th Floor Two World Trade Center New York, New York 10048 Attention: E. Davisson Hardman, Jr. with a copy to: Mitchell L. Berg, Esq. Paul, Weiss, Rifkind, Wharton & Garrison 1285 Avenue of the Americas New York, New York 10019-6064 To Rubin, Rubin/GCA, and/or GCA: Richard H. Rubin c/o The Richard H. Rubin Companies 11200 Rockville Pike Suite 200 Rockville, MD 20852 with a copy to: Feldman, Bodansky & Rubin 1819 L Street, N.W. Seventh Floor Washington, D.C. 20036 Attention; Steven K. Rubin, Esq. and Rubin and Rudman 50 Rowes Wharf Boston, Massachusetts 02110 Attention: Myrna Putziger The parties further acknowledge that from and after the date hereof, no notice need be given to LSA. 14. The Borrower represents and warrants to the Lender that: (1) This Agreement has been duly authorized, executed and delivered by the Borrower; (2) each of the Other Restructuring Documents (as hereinafter defined) has been duly authorized, executed and delivered by the Borrower; (3) this Agreement and the Other Restructuring Documents constitute valid and binding obligations of the Borrower in accordance with their respective terms, except as enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the enforcement of creditors' rights generally and (4) the execution, delivery and performance of this Agreement and the Other Restructuring Documents, compliance by the Borrower with the provisions hereof and of the Other Restructuring Documents, and the consummation of the transactions contemplated hereby and thereby have been duly authorized by all necessary trust and partnership action on the part of the Borrower and will not conflict with, result in a breach of or constitute a default under (i) any agreement, indenture or instrument to which the Borrower is a party or by which it is bound or (ii) the organizational documents of the Borrower. As used herein, the term "Other Restructuring Documents" shall mean, collectively, (i) the following documents of even date herewith by and between the Borrower and the Lender: (a) Second Amendment to Additional Interest Agreement; (b) Second Amendment to Second Mortgage and Security Agreement; (c) Amendment to Second Conditional Assignment of Rents and Leases; (d) Amendment to Assignments and (e) Second Amendment to Notes and (ii) that certain Government Center Garage Realty Trust Direction of Beneficiary of even date herewith by GCGA Limited Partnership. 15. Each of the Borrower and the Lender shall cooperate with the other, and shall execute, acknowledge and deliver such documents and take such further actions as may be reasonably requested by the other, to carry out the provisions hereof and of the Other Restructuring Documents and the transactions contemplated hereby and thereby. 16. As modified hereby, the Original Loan Agree- ment, as modified by the First Loan Amendment and the Second Loan Amendment, is hereby ratified and confirmed in all respects by the parties hereto. Without limiting the foregoing, the parties hereto hereby acknowledge and confirm the provisions of Section 11.14 of the Original Loan Agreement, which provisions are, subject to provisions of the Amended Additional Interest Agreement relating to recourse liability after the End Transaction (as defined therein), (i) hereby made applicable to the Original Loan Agreement, as amended by the First Loan Amendment and the Second Loan Amendment and as amended hereby, and (ii) hereby incorporated herein by reference. 17. This Agreement is to be governed by and con- strued in accordance with the laws of the Commonwealth of Massachusetts. 18. This Agreement may be executed in counterparts and as so executed under seal shall constitute but one Agreement. IN WITNESS WHEREOF, the Borrower and the Lender have duly executed this Agreement on the day and year first above written. BORROWER: /s/Richard H. Rubin ___________________________________ Richard H. Rubin, as Trustee of Government Center Garage Realty Trust and not individually /s/Myrna Putziger ___________________________________ Myrna Putziger, as Trustee of Government Center Garage Realty Trust and not individually LENDER: DEAN WITTER REALTY YIELD PLUS, L.P. By: Dean Witter Realty Yield Plus Inc., general partner /s/E. Davisson Hardman, Jr. By:__________________________ E. Davisson Hardman, Jr. Name:_____________________ President Title:____________________ By: Dean Witter Realty Yield Plus Associates, L.P., general partner By: Dean Witter Realty Yield Plus, Inc., general partner /s/ E. Davisson Hardman, Jr. By:__________________________ E. Davisson Hardman, Jr. Name:_____________________ President Title:____________________ DEAN WITTER REALTY YIELD PLUS II, L.P. By: Dean Witter Realty Yield Plus II Inc., general partner /s/E. Davisson Hardman, Jr. By:__________________________ E. Davisson Hardman, Jr. Name:_____________________ President Title:____________________ By: Dean Witter Realty Yield Plus Associates II, L.P., general partner By: Dean Witter Realty Yield Plus II, Inc. general partner /s/E. Davisson Hardman, Jr. By:__________________________ E. Davisson Hardman, Jr. Name:_____________________ President Title:____________________ Exhibit (10)(j) _______________ SECOND AMENDMENT TO NOTES This SECOND AMENDMENT TO NOTES (this "Second Amendment") dated September 20, 1993 by and among Richard H. Rubin and Myrna Putziger, as trustees under a declaration of trust dated November 1, 1983 and recorded in the Suffolk County Registry of Deeds in Book 10615, Page 58, and filed with the Suffolk Registry District of the Land Court on Certificate of Title No. 96370, of GOVERNMENT CENTER GARAGE REALTY TRUST, a Massachusetts nominee trust (the "Maker"), having a principal place of business c/o The Richard H. Rubin Companies, 11200 Rockville Pike, Suite 200, Rockville, Maryland 20852, and DEAN WITTER REALTY YIELD PLUS, L.P., a Delaware limited partnership ("YP") and DEAN WITTER REALTY YIELD PLUS II, L.P., a Delaware limited partnership ("YPII"; YP and YPII being collectively referred to hereinafter as the "Holder"), each having its principal place of business at Two World Trade Center, New York, New York 10048. W I T N E S S E T H : WHEREAS, (a) the Maker executed and delivered to YP a certain Amended and Restated Construction Loan/Office Loan Promissory Note (Yield Plus) dated as of October 12, 1989 (the "Original YP Note") and (b) the Maker and YP executed and delivered a certain First Amendment to Amended and Restated Construction Loan/Office Loan Promissory Note (Yield Plus II) dated June 22, 1990 (the "YP Note Amendment"; the Original YP Note, as amended by the YP Note Amendment, being hereinafter referred to as the "YP Note"); and WHEREAS, (a) the Maker executed and delivered to YPII a certain Amended and Restated Construction Loan/Office Loan Promissory Note (Yield Plus II) dated as of October 12, 1989 (the "Original YPII Note") and (b) the Maker and YPII executed and delivered a certain First Amendment to Amended and Restated Construction Loan/Office Loan Promissory Note (Yield Plus II) dated June 22, 1990 (the "YPII Note Amendment"; the Original YPII Note, as amended by the YPII Note Amendment, being hereinafter referred to as the "YPII Note," and the YP Note and the YPII Note being hereinafter collectively referred to as the "Notes"); and WHEREAS, the Maker and the Holder are this day executing and delivering a Supplemental Loan Agreement ("SLA") and a Second Amendment to Additional Interest Agreement ("Additional Interest Amendment"), each of which documents amends in certain respects the terms of the loan evidenced by the Notes; and WHEREAS, the Maker and the Holder wish to modify both of the Notes on the terms and conditions set forth herein to reflect the provisions of the SLA and the Additional Interest Amendment; NOW, THEREFORE, in consideration of the premises and of the mutual covenants herein contained, the Maker and the Holder hereby agree as follows: 19. All capitalized terms used and not defined herein shall have the meanings ascribed to them in the Notes. 20. All references in the Notes to the Loan Documents shall be deemed to refer to, collectively, the YP Note, the YPII Note, the Loan Agreement, the Additional Interest Agreement, the Indemnity Agreement and each Security Document, as each such document has been amended or modified through the date hereof (including, without limitation, hereby and by the SLA and the Additional Interest Amendment) and may be amended or modified from time to time. All references in the Notes to the Loan Agreement shall be deemed to refer to the Loan Agreement, as such document has been amended through the date hereof (including by the SLA) and may be further amended from time to time. All references in the Notes to the Additional Interest Agreement shall be deemed to refer to the Additional Interest Agreement, as such document has been amended through the date hereof (including by the Additional Interest Amendment) and may be further amended from time to time. 21. The Maker hereby ratifies and confirms the YP Note and the YPII Note, as amended hereby, in all respects. The Lender and the Maker hereby acknowledge and confirm the non-recourse provisions set forth in the third paragraph of page 6 of both the Original YP Note and the Original YPII Note, which non-recourse provisions are, subject to provisions in the Additional Interest Agreement relating to recourse liability after the End Transaction (as defined therein), (i) hereby made applicable to the Notes, as amended hereby, and (ii) hereby incorporated herein by reference. 22. This Second Amendment shall be construed, enforced and governed by the laws of the Commonwealth of Massachusetts. 23. This Second Amendment may be executed in counterparts and as so executed shall constitute but one Amendment. IN WITNESS WHEREOF, the Maker and the Holder have duly executed under seal this Amendment on the day and year first above written. Maker: /s/Richard H. Rubin ___________________________________ Richard H. Rubin, as Trustee of Government Center Garage Realty Trust and not individually /s/Myrna Putziger ___________________________________ Myrna Putziger, as Trustee of Government Center Garage Realty Trust and not individually Holder: DEAN WITTER REALTY YIELD PLUS, L.P. By: Dean Witter Realty Yield Plus Inc., general partner /s/E. Davisson Hardman, Jr. By:__________________________ E. Davisson Hardman, Jr. Name:_____________________ President Title:____________________ By: Dean Witter Realty Yield Plus Associates, L.P., general partner By: Dean Witter Realty Yield Plus, Inc., general partner /s/E. Davisson Hardman, Jr. By:__________________________ E. Davisson Hardman, Jr. Name:_____________________ President Title:____________________ DEAN WITTER REALTY YIELD PLUS II, L.P. By: Dean Witter Realty Yield Plus Inc., general partner /s/E. Davisson Hardman, Jr. By:__________________________ E. Davisson Hardman, Jr. Name:_____________________ President Title:____________________ By: Dean Witter Realty Yield Plus Associates II, L.P., general partner By: Dean Witter Realty Yield Plus Associates II, L.P., general partner /s/E. Davisson Hardman, Jr. By:__________________________ E. Davisson Hardman, Jr. Name:_____________________ President Title:____________________ EX-27 4
5 Registrant is a limited partnership which invests in real estate, participating mortgage loans,and real estate joint ventures. In accordance with industry practice, its balance sheet is unclassified. For full information, refer to the accompanying audited financial statements. DEAN WITTER REALTY YIELD PLUS, LP 0000810116 12-MOS DEC-31-1995 DEC-31-1995 18,939,265 0 684,482 0 0 0 0 0 141,753,976 0 0 0 0 0 97,934,001 141,753,976 0 34,399,506 0 0 20,329,821 6,931,459 5,794,644 1,343,582 0 1,343,582 0 0 0 1,343,582 .17 0 In addition to cash and receivables, total assets include net investments in real estate of $98,516,738, net investments in participating mortgage loan of $19,974,382, net deferred expenses of $1,626,335 and other assets of $2,012,774. Represents partners' capital. Liabilities include mortgage notes payable of $20,003,736, minority interests of $19,566,955, and accounts payable and other liabilities of $4,249,284. Total revenue includes rent of $27,033,215, interest on participating mortgage loan of $2,745,433, gain on sale of real estate of $3,334,036, interest on short-term investments of $496,283 and other revenue of $790,539. Represents net income per Unit of limited partnership interest.
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