LSI 2010 Real Estate Joint Ventures conference materials.pdf
LSI 2010 Real Estate Joint Ventures conference materials.pdf
LSI 2010 Real Estate Joint Ventures conference materials.pdf
You also want an ePaper? Increase the reach of your titles
YUMPU automatically turns print PDFs into web optimized ePapers that Google loves.
Donald E. Percival of Davis Wright Tremaine LLP Speaker 27: 5<br />
2. Other <strong>Real</strong> <strong>Estate</strong> <strong>Joint</strong> <strong>Ventures</strong><br />
(a) Right of First Offer: Before selling entity interests to third<br />
party, initiating partner must first offer to sell those<br />
interests to receiving partner(s) at price specified by<br />
initiating partner; if no receiving partner agrees to purchase<br />
at that price, initiating partner is permitted for limited time<br />
to sell interests to third party on terms no more favorable to<br />
third party than those offered to receiving partner(s).<br />
(b) Right of First Refusal: Initiating partner obtains bona fide<br />
purchase agreement from third party, offers to sell its entity<br />
interest to receiving partner(s) on terms stated in third-party<br />
offer; if no receiving partner agrees to purchase on terms<br />
stated in third-party offer, initiating partner may for limited<br />
time sell interests to third party per terms of third-party<br />
offer.<br />
(c) Forced Property Sale: Initiating partner obtains bona fide<br />
third-party offer to purchase underlying property and<br />
proposes that receiving partners approve sale of property by<br />
entity to third party pursuant to offer; receiving partner(s)<br />
must elect either to (i) approve the sale of the entity<br />
property to the third party or (ii) purchase the initiating<br />
partner’s interest in the entity for a price equivalent to what<br />
initiating partner would have received had the entity sold<br />
its property pursuant to the third-party offer, satisfied its<br />
obligations and made liquidating distributions to the<br />
partners.<br />
(d) Buy-Sell (a/k/a “shootout”): Initiating partner specifies<br />
value for entity property; receiving partner must elect either<br />
to (i) purchase the initiating partner’s interest in the entity<br />
for a price equivalent to what initiating partner would have<br />
received if the entity were to sell its property for the stated<br />
value, satisfy its debts and make liquidating distributions to<br />
the partners, or (ii) sell the receiving partner’s interest in<br />
the entity for a price equivalent to what receiving partner<br />
would receive if the entity were to sell its property for the<br />
stated value, satisfy its debts and make liquidating<br />
distributions to the partners.<br />
- 4 -<br />
Law Seminars International | <strong>Real</strong> <strong>Estate</strong> <strong>Joint</strong> <strong>Ventures</strong> and Funds | 02/09/10 in Seattle, WA
Change language