EXHIBIT 10.1
PURCHASE AND SALE AGREEMENT
(Villas at Cherry Hills)
THIS PURCHASE AND SALE AGREEMENT (this "Agreement") is entered into and
effective as of as of this 18th day of April, 2003, by and between Villas at
Cherry Hills, LLC, a Colorado limited liability company ("Seller"), whose
address is 0000 X. Xxxxxxx Xxxxxx, Xxxxx 000, Xxxxxxxxxx, Xxxxxxxx 00000, and
Xxxxxxxx Homes Corporation, a Colorado Corporation, or its permitted assigns
hereunder, whose current address is c/o 00 Xxxxxxxxx Xxxxx Xxxx, Xxxxx 000,
Xxxxxxxxx, Xxxxxxxx 00000 ("Purchaser").
RECITALS:
A. Seller is the fee owner of that certain real property and all
improvements thereon and appurtenances thereto located in the City and County of
Denver, State of Colorado (the "Property"), which Property is defined herein and
further described on Exhibit A attached hereto and incorporated herein by this
reference.
B. Purchaser desires to acquire the Property from Seller.
C. The Seller and Purchaser hereby agree to the terms and provisions of
this Agreement.
AGREEMENT
1. Definitions.
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For purposes of this Agreement, the following terms shall have the meanings
set forth below:
1.1 "Closing"
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shall mean the date of execution and delivery of the "Deed", as
defined below, and other documents necessary to consummate Seller's sale of
the Property and the Residences to Purchaser.
1.2 "Contracts"
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shall mean and refer to all contracts, agreements or other
arrangements, written or oral, which are in any manner associated with, or
which may have any rights or connection to, the Property, a Lot, a
Residence, that are still in effect, or for which there remain any
outstanding obligations or entitlements, at the time of Closing, and which
have been set forth and disclosed to Purchaser by Seller on Exhibit B,
attached hereto and incorporated herein by this reference, which have been
reviewed and not objected to by Purchaser as further provided under this
Agreement.
1.3 "Lot" or "Lot(s)"
---------------------
shall mean those portions of the Property designated as such in
Exhibit A which, as a result of the approval of the applicable jurisdiction
and recordation of the respective plats therefore in the real property
records of Denver County, Colorado, are, or will be prior to Closing of the
respective conveyance of title thereto as provided hereunder, fully
subdivided and separately conveyable lots, with all necessary
development-ready services to the
1
lot line, according to the applicable laws regarding the subdivision and
development of property in Colorado and the applicable county in which the
respective Lot is located. For purposes of this Agreement, the term Unit s)
is included within the definition of Lots to the extent and as applicable
to those Lots upon which properly permitted construction of a Unit had been
commenced at the time of Closing hereunder.
1.4 INTENTIONALLY OMMITTED
1.5 "Permitted Exceptions"
--------------------------
shall mean the following, only to the extent that they are not Title
Defects as defined under Section 4.5 of this Agreement: (i) any easements,
restrictions or conditions shown on the Final Plat; (ii) real property
taxes and assessments for the year of Closing and subsequent years; (iii)
building, zoning and other applicable ordinances and regulations of Denver
County, Colorado (the "County"); (iv) any and all reservations, exceptions,
easements, rights of way, restrictive covenants, conditions and other
matters that may be recorded in the records of the County; (v) taxes,
assessments, fees or charges, if any, resulting from the inclusion of the
Property in any water and sanitation district and any and all other special
taxing districts in which the Property is included; (vi) any defects in or
objections to title to the Property caused by Purchaser or any one claiming
by, through or under Purchaser; (vii) any condition which is open and
obvious on the ground or which a survey would disclose; and (viii) any
other reservations, exceptions, easements, rights-of-way, or other matters
which are waived or deemed waived by Purchaser pursuant to Section 4
hereof.
1.6 INTENTIONALLY OMMITTED
1.7 "Plans"
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shall mean and refer to all plans and specifications applicable to a
Unit constructed or to be constructed on a Lot, inclusive of all detailed
construction plans, as built drawings, all specifications therefore and any
and all changes, amendments and modifications thereof.
1.8 "Property",
---------------
as described above including 12 units and 1 lot in Phase 1, 26 lots in
Phase 2 and 29 lots in Phase 3, and described in Exhibit A, shall mean and
consist of the Lots together with single family attached units (the
"Unit(s)") located on certain of the Lots that are in various stages of
completion, plus the completed Units as further defined herein, plus the
net proceeds of the sale and closing of any Lot that occurs prior to the
Closing hereunder. For purposes of this paragraph and this Agreement, the
"net proceeds of the sale and closing of any Lot that occurs prior to the
Closing hereunder" shall mean and include the gross proceeds of the sale
and closing of any Lot hereunder, including any completed Unit thereon,
minus all costs of sale approved by Purchaser and any other costs regarding
the Lot or completed Unit that would be otherwise credited against the
Purchase Price for same under this Agreement, which net proceeds amount
will be escrowed from and out of the Closing of the sale of the respective
Lot and held pending the Closing hereunder.
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1.9 "Completed Unit(s)"
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shall mean and include the single family attached unit and all related
improvements constructed or to be constructed on the Lot(s); together with
the Plans associated with the Unit constructed or to be constructed on the
Lot, and all Contracts regarding the Lot or Unit.
2. Purchase and Sale.
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2.1 Agreement for Purchase and Sale.
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In consideration of the mutual obligations set forth below and for
other good and valuable consideration, the sufficiency of which is hereby
acknowledged by the parties hereto, Seller agrees to sell and Purchaser
agrees to buy the Property according to the terms and conditions set forth
in this Agreement.
2.2 Purchase Price.
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The Purchase Price ("Purchase Price") for the Property shall be and
include: (i) assumption of the existing construction loans for the12
completed or near completed Units in Phase 1, or obtaining new financing on
the Lots and Units, (collectively, "Unit Construction Financing"), an
approximate total of $5,308,785 (to be adjusted at closing) in accordance
with the schedule of such outstanding Unit Construction Financing as set
forth on Exhibit C attached hereto and incorporated herein by this
reference; (ii) assumption of the Mezzanine land improvement loan to
Guarantee Bank in the approximate amount of $128,471; (iii) assumption of
or conversion of the land loan in the approximate amount of $2,669,189 (to
be adjusted at closing) to Guarantee Bank for Phase 2 as further described
and set forth on Exhibit C, attached hereto and incorporated herein by this
reference; (iii) assumption of the Anthem bankruptcy Trustee contract in
the approximate amount of $1,925,000 for Phase 3 purchasing the Peak
National Bank note and return of the $400,000 pledge held by Peak National
Bank to Xxxxxxx Xxxxxxx; (iv) assumption of the PT Eagle note in the
approximate amount of $1,310,745 and release of the Xxxxxxx Xxxxxxx
judgment in favor of PT Eagle ; (v) the monetary obligation for xxxxxxx
money deposits from purchasers of individual Lots and Units previously
given to Seller as further set forth and described on Exhibit C, attached
hereto and incorporated herein by this reference (in conjunction with and
to the extent of the transfer to Purchaser from Seller of the said xxxxxxx
money deposits at the time of Closing hereunder); (vi) Satisfaction of the
outstanding Subcontractor Payables in the approximate amount of $97,513 and
past due real estate taxes in the amount of $86,000 (all to be adjusted at
closing) as disclosed on Exhibit C of this agreement, attached hereto and
incorporated herein by this reference; (vii) plus an equity amount to be
determined prior to closing in the form of Purchaser's common stock.
3. Completion of Units.
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In addition to the Purchase Price to be paid by Purchaser to Seller as
herein set forth, Purchaser shall complete the Units and assume all warranty
obligations to initial purchasers of said Units subject to the terms of this
Agreement regarding such warranties. Matters herein regarding warranty
obligations shall survive the Closing.
4. Purchaser's Investigations and Reviews.
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4.1 Title Insurance Commitment.
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Within ten (10) days after execution and acceptance of this Agreement
by Seller, Seller shall deliver or cause to be delivered to Purchaser a
title insurance commitment (the "Title Commitment", Exhibit B) issued by
North American Title Company ("Title Company") together with copies of all
recorded exceptions to title referred to therein (collectively with the
Title Commitment, the "Title Documents"), showing merchantable title to the
Property to be vested in Seller and committing to insure such title to the
Property in Purchaser or Purchaser's agreed assignees or designees by the
issuance as of the Closing date hereunder of its standard form owner's
policy of title insurance in the amount of the Purchase Price, deleting
there from the pre-printed Standard Exceptions and containing only such
other exceptions as are not objected to by Purchaser as otherwise provided
in this Agreement. Purchaser shall be entitled to review the Title
Documents as part of its investigations hereunder, as further set forth
herein.
4.2 Title Defects.
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If, upon review of the Title Documents, Purchaser asserts the
existence of any encumbrance, encroachment, defect in or other matter
affecting title which, in Purchaser's opinion, renders title to the
Property, unmarketable or otherwise unacceptable, and which Purchaser does
not waive (any of the foregoing shall be deemed a "Title Defect"),
Purchaser will give Seller written notice of such Title Defect(s) within
ten (10) business days after Purchaser's discovery of each such Title
Defect and, in any case, on or before the date of Closing. After receipt of
such notice, Seller shall use such efforts and expend such amount as are
reasonable to remove or cure any such Title Defects prior to Closing.
Seller shall have no obligation, however, to cure any Title Defect. If
Seller elects, in its sole discretion, to cure any Title Defect, Seller
may, by written notice to Purchaser within five (5) days of such election
but, in any event, prior to the date of Closing, extend the date of Closing
for a period up to thirty (30) days (the "Title Defect Extension") in order
to attempt to cure such Title Defect. If Seller elects to invoke the Title
Defect Extension, Seller shall give written notice to Purchaser when any
Title Defect is cured and Closing shall occur on the tenth (10th) business
day following the giving of such notice or such other date to which the
parties may agree which shall be, in any event, prior to the end of the
thirty (30) day time period referenced above for Title Defect extension. If
Seller does not or is unable to so remove or cure all such Title Defects
prior to Closing, Purchaser may: (i) waive all such uncured Title Defects
and accept such title as Seller is able to convey as of Closing; or (ii)
terminate this Agreement and all parties shall be relieved of any further
obligations hereunder.
Seller shall be entitled to use and rely on the net proceeds from Closing
otherwise due to the Seller in order to cure or remove any Title Defect
which may be removed by payment of an ascertainable amount of money and for
which the title policy will delete or affirmatively insure over the Title
Defect so cured in conjunction with, and at the time of, the Closing.
Purchaser agrees that any Title Defect shall be deemed cured if Seller
shall cause the Title Defect to be deleted from the Title Commitment and
the "Title Policy" as defined below, or if Seller obtains affirmative title
insurance protection inuring to the Purchaser with respect thereto at or
before the Closing.
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4.3 Property Inspections & Document Reviews.
--------------------------------------------
Purchaser shall be entitled to Inspect the Property, and review all
documents and other matters connected with or related to the Property,
including only by way of example, and expressly without limitation, the
Plans, the Contracts, Real Estate Listing Agreements, the Lot purchaser
Xxxxxxx Money Deposits and related purchase agreements, the Subcontractor
Payables, and the Unit Construction Financings, for its satisfaction and
approval. If Purchaser is not satisfied with its inspection of the Property
or its review of any of the above referenced or other documents or matters
regarding the Property, and Purchaser notifies Seller of its
dissatisfaction on or before the Closing Date hereunder, then Purchaser
shall be entitled to terminate this Agreement. Upon such termination, all
parties hereto shall be released from any and all obligations hereunder
except to the extent expressly provided for otherwise, and this Agreement
shall be of no further force and effect. For purposes of this Agreement,
the Inspection Period, as that term may be otherwise used in this
Agreement, shall mean and refer to the period of time from and after the
mutual execution of this Agreement to and including the Closing Date.
4.4 Entry Limitations and Waiver.
---------------------------------
Purchaser, its authorized agents, employees and independent
contractors, shall have the right, for Purchaser's benefit, to enter upon
the Property for the purpose of conducting all reasonable investigations,
inspections and studies thereof. Any entry by or on behalf of Purchaser
shall be subject to such reasonable rules, regulations, standards and
conditions as Seller may impose, but in a manner so as not to unreasonably
interfere with Purchaser's rights to inspect the Property and conduct
reasonable tests thereof. All inspections, tests and studies shall be at
the sole cost and expense of Purchaser. Purchaser shall not damage, destroy
or harm the Property, or unreasonably impact the vegetation thereon while
conducting any inspection, test or study, and Purchaser shall be
responsible for promptly repairing and reasonably restoring the Property to
its original condition at Purchaser's sole cost and expense. In addition,
Purchaser acknowledges that dangerous conditions may exist on and in the
vicinity of the Property. Purchaser hereby waives all claims for any injury
suffered by Purchaser resulting from Purchaser's entry upon the Property
and not caused by Seller's gross negligence or intentional misconduct. The
preceding acknowledgement and waiver shall survive Closing and any
termination of this Agreement.
4.5 Indemnity.
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Purchaser agrees to indemnify and hold Seller harmless from and
against any claim, demand, liability, lien, cost or expense asserted
against Seller, the Property arising out of or resulting from the activity
of Purchaser's investigations thereof, and to pay Seller all reasonable
costs and expenses, including reasonable attorney's fees, incurred in
successfully defending any such matter; provided, that Purchaser shall not
be liable to Seller for such claims as may be the result of Seller's gross
negligence or intentional misconduct. Notwithstanding any of the terms and
provisions of this Agreement to the contrary, this indemnification
obligation of Purchaser shall survive Closing and any termination of this
Agreement.
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4.6 Plans.
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Seller agrees to assign to Purchaser, at no cost to Purchaser, the
Seller's rights to use of the Plans that are currently being used to build
Units upon the Property. Seller represents that said Plans are complete and
usable as assigned. Any and all additional work required or necessary to
amend Plans and/or make any requested or desired changes shall be at the
sole cost of Purchaser.
5. Title.
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5.1 Status of Title.
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At Closing, Seller shall convey to Purchaser good and marketable fee
simple title to the Property.
5.2 Issuance of Title Policy.
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At Closing, Seller shall cause the Title Company to issue, or
unconditionally commit to issue at Seller's expense, to Purchaser or
Purchaser's designee, its standard form owner's policy of title insurance
insuring marketable, insurable title to the Lot(s) in the amount of the
Purchase Price, deleting the pre-printed Standard Exceptions, but subject
to the Permitted Exceptions (the "Title Policy"). Any endorsements, beyond
the pre-printed Standard Exceptions or in addition to those resulting from
Title Defects, requested by Purchaser shall be paid for by Purchaser.
5.3 Special Taxing Districts.
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SPECIAL TAXING DISTRICTS MAY BE SUBJECT TO GENERAL OBLIGATION
INDEBTEDNESS THAT IS PAID BY REVENUES PRODUCED FROM ANNUAL TAX LEVIES ON
THE TAXABLE PROPERTY WITHIN SUCH DISTRICTS. PROPERTY OWNERS IN SUCH
DISTRICTS MAY BE PLACED AT RISK FOR INCREASED MILL LEVIES AND EXCESSIVE TAX
BURDENS TO SUPPORT THE SERVICING OF SUCH DEBT WHERE CIRCUMSTANCES ARISE
RESULTING IN THE INABILITY OF SUCH A DISTRICT TO DISCHARGE SUCH
INDEBTEDNESS WITHOUT SUCH AN INCREASE IN MILL LEVIES. PURCHASER SHOULD
INVESTIGATE THE DEBT FINANCING REQUIREMENTS OF THE AUTHORIZED GENERAL
OBLIGATION INDEBTEDNESS OF SUCH DISTRICTS, EXISTING MILL LEVIES OF SUCH
DISTRICT SERVICING SUCH INDEBTEDNESS, AND THE POTENTIAL FOR AN INCREASE IN
SUCH MILL LEVIES.
6. Seller's Representations, Warranties and Covenants.
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Seller represents, warrants and covenants to Purchaser as follows:
6.1 Good Title.
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Seller owns good, marketable and insurable fee simple title to the
Property, subject to the Permitted Exceptions.
6.2 No Third-Party Interests.
-----------------------------
Seller has not granted to any party any options, contracts or other
agreements with respect to a purchase or sale of the Property, or any
portion thereof or any interest therein except existing listing agreements
regarding the marketing and sale of Lots and Units entered into in the
ordinary course of business ("Real Estate Listing agreements").
6.3 No Possessory Rights.
-------------------------
Except for any rights of possession under the Permitted Exceptions,
there are no parties in possession of any of the Property, and there are no
other rights of possession or use, which have been granted to any third
party.
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6.4 Notices.
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Seller has no knowledge, and Seller has not received notice that : (i)
the Property is in violation of any applicable statutes, ordinances, codes
(including, but not limited to, zoning, building, subdivision, pollution,
environmental protection, water disposal, health, fire and safety
engineering codes), or the rules and regulations of, any governmental
authority having jurisdiction over the Property; (ii) any actions, suits,
proceedings or claims are pending or threatened with respect to or in any
manner affecting the Property, or the ability of Seller to consummate the
transaction contemplated by this Agreement; or (iii) there are any pending
or threatened condemnation or similar proceedings or special assessments
affecting the Property, or any part thereof.
6.5 Environmental Conditions.
-----------------------------
Seller has no knowledge, and Seller has not received notice, of: (i)
any violation of Applicable Environmental Laws relating to the Property; or
(ii) the presence, use, storage or discharge of any Hazardous Substances
on, in or under the Property.
As used herein, the term "Applicable Environmental Laws" shall mean
any local, state or federal law, rule or regulation, pertaining to
environmental regulation, contamination, cleanup or disclosure, including,
without limitation, the Comprehensive Environmental Response, Compensation
and Liability Act of 1980, as amended, (42 U.S.C. ss. 9601, et seq.), the
Resource, Conservation and Recovery Act, as amended, (42 U.S.C. ss. 6901,
et seq.), Superfund Amendments and Reauthorization Act of 1986 (Pub. L.
00-000 000 Stat. 1613), the Toxic Substances Control Act (15 U.S.C. ss.
2601, et seq.), the Emergency Planning and Community Right to Know Act of
1986 (42 U.S.C. ss. 1101, et seq.) and all amendments of the foregoing, or
any state superlien or environmental clean-up or disclosure statutes. As
used herein, the term "Hazardous Substances" shall mean all substances and
materials which are included under or regulated by any Applicable
Environmental Law together with asbestos, polychlorinated biphenyls,
petroleum and raw materials which include hazardous constituents.
6.6 Authority.
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Seller is a limited liability company duly organized and existing and
in good standing under the laws of the State of Colorado. Seller has the
full right and authority to enter into this Agreement and consummate the
transaction contemplated by this Agreement. All requisite company or other
entity action has been taken by Seller in connection with the entering into
of this Agreement, the documents and instruments referenced herein, and the
consummation of the transactions contemplated hereby. Each of the persons
and entities signing this Agreement on behalf of Seller is authorized to do
so. Seller shall furnish to Purchaser any and all documents to evidence
such authority, as Purchaser shall reasonably request.
6.7 "AS IS, WHERE IS" Disclaimer of Warranties:
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6.7.1 Purchaser acknowledges and agrees: Except as provided or
expressly represented herein, neither Seller nor anyone acting for or
on behalf of Seller, makes or agrees to make, except as may be
otherwise expressly set forth herein, any representation, warranty,
statement or promise to Purchaser concerning the Property, the
quality, value, physical aspects or condition thereof; any dimensions
or specifications of the Property, the feasibility, desirability,
convertibility of the Property for or into any particular use, the
current or projected income or expenses of the Property or any other
matter with respect to the Property; that entering into this
Agreement, Purchaser has not relied upon any representation, statement
or warranty of Seller or anyone acting for or on behalf of Seller,
other than as expressly contained in this Agreement and that all
matters concerning the property, including the maximum size of any
improvements that can be constructed thereon, have been independently
verified by Purchaser and that Purchaser is purchasing the Property
based upon its own inspection and examination thereof; that Purchaser
is purchasing the Property "AS IS" and "WHERE IS" with all faults; and
that Purchaser does hereby waive and Seller does hereby disclaim all
Warranties, whether expressed or implied, including by way of
description but not limitation, those of marketability,
merchantability of title, fitness for a particular purpose,
tenantability, habitability, use and all warranties relating to
compliance by the property with any applicable governmental laws and
regulations including, without limitation, building and zoning codes,
the soil conditions of the Property, and the compliance by the
Property with any environmental requirements.. The terms of this
paragraph will survive the closing and conveyance of the Property to
Purchaser by Seller.
6.8 Omissions; Indemnity.
-------------------------
All representations and warranties made by Seller in this Article 6
are free from any untrue statement of material fact and do not omit to
state any material facts necessary to make the statements contained herein
or therein not misleading. Each of the representations and warranties
contained in this Article 6 are acknowledged by Seller to be material and
to be relied upon by Purchaser in proceeding with this transaction, shall
be deemed to have been remade by Seller as of the date of the Closing and
shall survive the Closing for a period of five years. Seller shall
indemnify and hold Purchaser harmless and defend Purchaser from any loss,
liability or expense, including reasonable attorneys' fees, incurred by
Purchaser for any claim made against Purchaser by reason of the breach or
inaccuracy of any of the foregoing representations or warranties.
7. Purchaser's Representations and Warranties.
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Purchaser represents and warrants to Seller as follows:
7.1 Authority.
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Purchaser is a Corporation duly organized, validly existing and in
good standing under the laws of the State of Colorado, and is authorized to
conduct business in the State of Colorado. Purchaser has the full right and
authority to enter into this Agreement and consummate the transaction
contemplated by this Agreement. All requisite corporate action has been
taken by Purchaser in connection with the entering into of this Agreement,
the instruments referenced herein, and the consummation of the transaction
contemplated hereby. Each of the persons signing this Agreement on behalf
of Purchaser is authorized to do so. Purchaser shall furnish to Seller any
and all documents to evidence such authority, as Seller shall reasonably
request.
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7.2 Investigations.
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Prior to the end of the Inspection Period, Purchaser will make all
investigations it deems necessary or prudent concerning its acquisition of
the Property and its intended development and Marketing of same, including,
without limitation, investigations into soils conditions, environmental
conditions, and environmental assessment, if any, obtained by Purchaser,
suitability of the grading plans for the subdivision, and the status of any
applicable home owner's association.
7.3 INTENTIONALLY OMMITTED
7.4 Omissions; Indemnity.
-------------------------
All representations and warranties made by Purchaser in this Agreement
are free from any untrue statement of material fact and do not omit to
state any material facts necessary to make the statements contained herein
or therein not misleading. Each of the representations and warranties
contained in this ARTICLE 7 are acknowledged by Purchaser to be material
and to be relied upon by Seller in proceeding with this transaction, shall
be deemed to have been remade by Purchaser as of the date of the Closing
and shall survive the Closing. Purchaser shall indemnify and hold Seller
harmless and defend Seller from any loss, liability or expense, including
reasonable attorneys' fees, incurred by Seller for any claim made against
Seller by reason of the breach or inaccuracy of any of the foregoing
representations or warranties.
7.5 INTENTIONALLY OMMITTED
8. Seller's Undertakings Pending Closing.
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8.1 Title and Survey.
---------------------
Until the earlier of the Closing or the termination of this Agreement,
Seller agrees not to do anything, and not to permit anything to be done,
which would impair or modify the status of title as shown on the Title
Commitment or the Survey, or to otherwise affect, encumber or impair the
Property in any manner, unless specifically agreed to by Purchaser as a
part of Seller's cure of any Title Defect hereunder.
8.2 Advise Purchaser.
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Until the earlier of the Closing or the termination of this Agreement,
Seller agrees to notify Purchaser promptly upon learning or receiving
notice, whichever first occurs, of:
8.2.1 Prior to Closing.
-----------------------
Until the earlier of the closing or the termination of this
Agreement, Seller agrees to notify Purchaser of any event,
transaction, or occurrence prior to the Closing which would or
might materially affect the Property, or any part thereof; or any
other agreement with respect to the Property.
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8.2.2 Representations and Warranties.
-------------------------------------
Any fact or event which would make any of the
representations or warranties of Seller contained in this
Agreement untrue or misleading in any material respect or which
would cause Seller to be in violation of any of its covenants or
other undertakings or obligations hereunder.
8.2.3 Litigation.
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Any pending or threatened (and unresolved) litigation which
affects the Property, or any part thereof, or which would affect
the transaction contemplated hereby.
8.2.4 Damage.
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Any damage or destruction (excluding normal wear and tear)
to the Property, or any part thereof.
8.2.5 Condemnation.
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Any pending or threatened (and unresolved) condemnation
which would affect the Property, or any part thereof.
8.2.6 Bankruptcy.
-----------------
Any threatened (and unresolved) or pending proceedings in
bankruptcy or insolvency which would affect the Property, or any
person or entity owning any interest therein.
8.2.7 Default.
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Any default under any agreement which would affect all or
any part of the Property or the, or any act or omission which
with the passage of time or the giving of notice, or both, would
constitute such a default.
Upon the happening of any one or more of the events described
above, Purchaser, upon receipt of the notice herein provided for
regarding such items or events, shall have the option of
accepting the fact or event for which it received notice or,
alternatively and at its election, terminating this Agreement via
written notification thereof to Seller on or before the Closing
Date.
9. Conditions Precedent to Obligations to Close.
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9.1 Conditions Precedent to Purchaser's Obligation to Close.
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Purchaser shall not be obligated to close hereunder unless each of the
following conditions shall exist on the date of the Closing:
9.1.1 Title Policy.
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The Title Company shall be prepared to issue (or
unconditionally commit to issue) the Title Policy as described in
Section 5.2.
9.1.2 Accuracy of Representations.
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The representations and warranties made by Seller in ARTICLE
6 shall be true and correct on and as of the Closing Date with
the same force and effect as though such representations and
warranties had been made on and as of the Closing Date, and
Seller will so certify.
9.1.3 Seller's Performance.
---------------------------
Seller shall have performed all covenants and obligations
and complied with all conditions required by this Agreement to be
performed or complied with by Seller on or before the Closing
Date.
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9.1.4 Property Inspections and Document Reviews.
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Purchaser shall have completed all desired Property
Inspections and Document Reviews allowed under Section 4.3 of
this Agreement within the Inspection Period and expressed no
dissatisfaction thereof that was not cured to its satisfactions.
9.1.5 Financing, Funding & Payment.
-----------------------------------
Purchaser shall have secured the financing and the funding,
converted all investor debt obligations, and obtained any and all
lender consents to any assumption of acquisition, development or
construction loans on terms acceptable to them.
9.2 Conditions Precedent to Seller's Obligation to Close.
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Seller shall not be obligated to close hereunder unless each of the
following conditions shall exist on the date of Closing:
9.2.1 Lender Consent.
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Purchaser shall use reasonable effort to obtain all required
consents to such purchase by current Lenders on the Property if
assumption of debt is used by the purchaser.
9.2.2 Bring Current and Assume.
-------------------------------
Purchaser agrees to assume the current disclosed liabilities
on the Property to the extent expressly provided in this
Agreement.
9.2.3 Release.
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Xxxx Xxxxxxx and Xxxxxxx Holding Corporation and their
affiliates shall be released by all lenders of the Property all
liability on the indebtedness associated with the Property that
is specifically described herein and for which such release is
otherwise expressly required hereunder. If such releases are not
obtained, Seller may agree to accept in lieu of such releases
full and unconditional indemnification by Purchaser of Xxxx
Xxxxxxx, Xxxxxxx Holding Corporation and their affiliates from
and against any and all liability to all lenders.
9.2.4 Investors.
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All investors and subordinate deed of trust holders holding
obligations secured by the Property, or any portion thereof, and
the Seller, and who are otherwise specifically disclosed to
Purchaser and described herein as requiring such consent shall
have consented to the sale.
9.2.5 INTENTIONALLY OMMITTED
9.2.6 INTENTIONALLY OMMITTED
10. Closing.
------------
Purchaser and Seller agree that closing ("Closing") shall occur as follows:
10.1 Closing Date and Place.
----------------------------
The Closing will occur on June 15, 2003, or such earlier date as may
be mutually agreed to by the parties (the "Closing Date"). The Closing will
take place at a time and a location designated by mutual agreement. Except
as expressly provided in this Agreement, the Closing Date shall not be
extended and time shall be of the essence as to the Closing Date.
11
10.2 Closing Documents.
-----------------------
At Closing, the parties will take the following actions:
10.2.1 Special Warranty Deed.
-----------------------------
Seller will deliver or cause to be delivered to Purchaser a
special warranty deed, in form and substance consistent with the
requirements of this Agreement and the Title Commitment, and
satisfactory to Purchaser or its counsel, properly executed and
acknowledged, conveying good and marketable title to the Property
subject only to the Permitted Exceptions.
10.2.2 INTENTIONALLY OMMITTED
10.2.3 Payment of Purchase Price.
---------------------------------
Purchaser shall pay the Purchase Price to Seller in
accordance with the provisions of this Agreement.
10.2.4 Settlement Sheets, and Funds.
------------------------------------
The Title Company shall prepare, and each party hereto will
sign and deliver, settlement statements and closing statement
reflecting the Purchase Price and all adjustments and pro-rations
to be made thereto pursuant to this Agreement. The closing
statement shall reflect the fact that Seller shall be obligated
to pay the premium for the Title Policy, the payment of fees for
recording the deed, and any documentary or other fees payable in
connection with such recording; and that the parties shall
equally split any closing fee payable to the Title Company.
10.2.5 Further Documents.
-------------------------
Purchaser and Seller shall execute and deliver all such
other documents (including, but not limited to, mechanic's lien
affidavits) as may be necessary or appropriate to carry out
Purchaser and Seller's respective obligations under this
Agreement and as may be further required by the Title Company
acting as the closing and settlement agent, or otherwise pursuant
to any written closing instructions.
10.3 Possession.
----------------
Purchaser will be entitled to enter into possession of the Property on
the date of Closing.
11. Adjustments or Pro-rations.
-------------------------------
Normal adjustments and pro-rations shall be made at the Closing on the
settlement sheets described in Section 10.2.4 above:
11.1 Ad Valorem Taxes.
----------------------
The Purchaser as detailed in the Purchase Price Section 2.2 shall
assume the real property taxes attributable to the Property.
11.2 Association(s) Assessments.
--------------------------------
Purchaser shall be responsible for all assessments levied against the
Property pursuant to the terms contained in any recorded covenants that are
Permitted Exceptions for all periods after the date of Closing Date. Seller
shall be responsible for and shall pay at closing all assessments levied
against the Property pursuant to the terms of any recorded covenants that
are Permitted Exceptions for all periods prior to and including the Closing
Date.
12
11.3 Excise, Transfer and Sales Taxes.
--------------------------------------
Seller shall be responsible for the payment of all excise, transfer
(such as documentary fees or stamps), sales and use taxes imposed with
respect to the transaction contemplated by the Agreement and shall
indemnify and hold Purchaser harmless from the payment of such taxes.
11.4 Insurance.
---------------
Purchaser shall be responsible for obtaining new insurance coverage
with respect to the Property as of the date of Closing.
12. INTENTIONALLY OMMITTED
13. Casualty Damage.
--------------------
13.1 Notice and Estimate.
-------------------------
In the event that the Property should be damaged by any casualty prior
to Closing, Seller shall promptly give Purchaser written notice of such
occurrence, and as soon thereafter as practicable, shall provide Purchaser
with an estimate made by an engineer or contractor selected by Seller and
approved by Purchaser (which approval shall not be unreasonably withheld or
delayed) of the cost and time required to repair such damage.
13.2 Minor Damage.
------------------
If the estimated cost of repairing such damage is equal to or less
than ten percent (10%) of the Purchase Price, then Seller shall promptly
contract for, pursuant to a contract approved by Purchaser, and commence
the repairs and complete so much thereof as may be accomplished prior to
the Closing Date. In the event such repairs are not completed on or before
the Closing Date, Seller shall assign to Purchaser or its designee so much
of the insurance proceeds, including the payment of any deductible amounts,
resulting from such damage as have not then been expended for repairs, and
Seller shall assign to Purchaser and Purchaser shall assume, the rights and
obligations under the construction contract pursuant to which such repairs
are being completed.
13.3 Major Damage.
------------------
If the estimated cost of such repairs is more than ten percent (10%)
of the Purchase Price, then either Seller or Purchaser may elect to
terminate this Agreement upon written notice to the other given within ten
(10) days after both parties' receipt of the estimate, whereupon both
parties shall be relieved of any further obligations hereunder; however, if
neither party elects to so terminate this Agreement, then this Agreement
shall remain in full force and effect and the parties shall proceed in
accordance with Section 13.2 above.
14. Condemnation.
-----------------
If prior to Closing, Seller learns of any actual or threatened taking in
condemnation or by eminent domain (or a sale in lieu thereof) of all or any
portion of the Property, Seller will notify Purchaser in writing promptly
thereof. Any actual or threatened taking or condemnation by any competent
authority in appropriate proceedings of all or any part of the Property between
the date of this Agreement and the Closing Date shall, at Purchaser's option,
13
cause a termination of this Agreement. Such election to terminate must be
exercised by Purchaser by notice to Seller within 15 days following Purchaser's
receipt of Seller's notice pursuant to this Section 14. Upon delivery of such
termination notice, this Agreement shall be terminated and both parties shall be
relieved of any future obligations hereunder. If Purchaser does not elect to so
terminate this Agreement, Seller shall be relieved of all obligations under this
Agreement with respect to any portion of the Property actually taken or
condemned, but Purchaser will be entitled to receive all proceeds of any such
taking or condemnation or all awards or settlement amounts regarding same.
Seller agrees that it will not make any adjustment or settlement of any such
taking or condemnation proceeding without Purchaser's written consent and will
take at Closing all action necessary to assign its entire interest in such award
to Purchaser or its designee.
15. Brokers and Commissions.
----------------------------
Each of the parties represents and warrants to the other that it has not
employed, retained or otherwise utilized any broker ("Broker") or finder in
connection with any of the transactions contemplated by this Agreement and no
broker or person is entitled to any commission or finder's fees in connection
with any of these transactions. The Parties each agree to indemnify and hold
harmless one another against any loss, liability, damage, cost, claim or expense
incurred by reason of any brokerage commission or finder's fee alleged to be
payable because of any act, omission or statement of the indemnifying Party.
16. Remedies.
-------------
16.1 Seller's Default.
----------------------
In the event that Seller shall default in the performance of any
obligation under this Agreement, Purchaser may, at its option, either: (i)
terminate this Agreement by giving written notice of termination to Seller,
whereupon both Purchaser and Seller shall be relieved of any further
obligations or liabilities hereunder, except those obligations or
liabilities that survive termination pursuant to the express terms of this
Agreement; or (ii) treat this Agreement as in full force and effect and
obtain specific performance therefore together with any damages to which it
may be lawfully entitled.
16.2 Purchaser's Default.
-------------------------
In the event that Purchaser shall default in the performance of any
obligation under this Agreement, Seller may, as its sole and exclusive
remedy, terminate this Agreement by giving written notice of termination to
Purchaser whereupon both Purchaser and Seller shall be relieved of any
further obligations or liabilities hereunder, except those obligations or
liabilities that survive termination pursuant to the express terms of this
Agreement.
17. General Provisions.
-----------------------
The parties further agrees as follows:
17.1 INTENTIONALLY OMMITTED
14
17.2 Time.
----------
Time is of the essence with regard to this Agreement and Seller's and
Purchaser's obligations hereunder. In the event that the date for
performance of any obligation hereunder falls on a Saturday, Sunday or
legal holiday, the date for performance of such obligation shall
automatically be extended to the next day that is not a Saturday, Sunday or
legal holiday.
17.3 Arbitration of Disputes.
-----------------------------
Purchaser and Seller agree that any and all disputes, claims and/or
controversies at law or in equity between Purchaser and Seller arising out
of, related to or any way connected with the Property, this Agreement, or
any resulting transactions, which are not settled through mediation shall
be decided by binding arbitration. The arbitration shall be conducted by
and in accordance with the rules of the Judicial Arbitration Group.
("JAG"). Judgment upon the award rendered by the arbitrator(s) may be
entered in any court having jurisdiction thereof. The parties shall have
the right to discovery in accordance with applicable Colorado law.
17.4 Entire Agreement.
----------------------
No change or modification of this Agreement shall be valid unless the
same is in writing and signed by the parties hereto. This Agreement
contains the entire agreement between the parties relating to the purchase
and sale of the Property. All prior negotiations and agreements between the
parties are merged into this Agreement and there are no promises,
agreements, conditions, undertakings, warranties or representations, oral
or written, express or implied, between the parties other than as set forth
or referenced herein.
17.5 No Survival.
-----------------
Except as expressly provided to the contrary in this Agreement, the
obligations of the parties under this Agreement shall not survive Closing.
17.6 Governing Law.
-------------------
This Agreement shall be construed and enforced in accordance with the
laws of the State of Colorado.
17.7 Notices.
-------------
All notices, demands or other communications required or permitted to
be given hereunder shall be in writing and delivered to Seller and/or
Purchaser at their respective addresses as provided in the preamble of this
Agreement or to such other address or such other person as any party shall
designate to the other for such purpose in the manner herein set forth. Any
and all such items shall be deemed to have been duly delivered upon
personal delivery; or as of the third (3rd) business day after mailing
certified, return receipt requested, postage prepaid, or as of 12:00 noon
on the immediately following business day after deposit with Federal
Express or a similar overnight courier service.
17.8 INTENTIONALLY OMMITTED
17.9 Headings.
--------------
The headings which appear in some of the Sections of this Agreement
are for purposes of convenience and reference and are not in any sense to
be construed as modifying the Sections in which they appear.
15
17.10 Counterparts.
-------------------
This Agreement may be executed by facsimile signature and/or in
counterparts, each of which (or any combination of which) when signed by
all of the parties shall be deemed an original, but all of which when taken
together shall constitute one and the same agreement.
17.11 Assignment.
-----------------
Purchaser may not assign its rights or obligations under this
Agreement without the prior written consent of Seller, and any such
attempted assignment shall be null and void and shall constitute a default
under this Agreement. During all times while the Agreement is in effect,
Seller will not negotiate sale of the Lots and Units with any other party
Notwithstanding the foregoing provisions to the contrary regarding
assignment, Purchaser shall be entitled to assign this Agreement or any
portion hereof to any affiliate entity in which Purchaser retains an
ownership and management position without the prior written or other
consent of Seller.
17.12 Successors and Assigns.
-----------------------------
Subject to Section 17.11, this Agreement shall be binding upon and
inure benefit of the parties hereto and their respective heirs, personal
representatives, successors, and assigns.
17.13 INTENTIONALLY OMMITTED
17.14 Severability.
-------------------
If any provision of this Agreement shall be invalid, illegal or
unenforceable, it shall not affect or impair the validity, legality or
enforceability of any other provision of this Agreement, and there shall be
substituted for the effected provision a valid and enforceable provision as
similar as possible to the effected provision.
17.15 Exhibits Incorporated; Execution.
---------------------------------------
All exhibits to this Agreement are incorporated herein and made a part
hereof as if actually set forth herein. This Agreement may be executed in
multiple counterparts and by facsimile signature.
17.16 Joint and Several Liability.
----------------------------------
If two or more persons or entities are named herein as Purchaser,
their obligations hereunder shall be joint and several.
17.17 General Cooperation.
--------------------------
Notwithstanding any other provision of this Agreement to the contrary,
and notwithstanding the Closing of the sale of the Property to Purchaser,
Purchaser and Seller agree in good faith before and after Closing to
execute such other further or additional documents, and to take such other
actions, as may be reasonably necessary or appropriate to fully carry out
the intent and purposes of the parties as set forth in this Agreement.
17.18 Negotiated Provisions.
----------------------------
The rule of construction by which the terms of a contract are
construed against the drafting party shall not apply to this Agreement or
any interpretation of it.
16
17.19 No Implied Waiver.
------------------------
No failure by Seller or Purchaser to insist upon the strict
performance of any term, covenant or provision contained in this Agreement,
no failure by Seller or Purchaser to exercise any right or remedy under
this Agreement, and no acceptance of full or partial payment or performance
owed to Seller or Purchaser during the continuance of any default by the
other party, shall constitute a waiver of any such terms, covenant or
provision, or a waiver of any such right or remedy, or a waiver of any such
default unless such waiver is made in writing.
17.20 INTENTIONALLY OMMITTED
17.21 Interstate Land Sales Act.
--------------------------------
17.21.1 Intent.
---------------
It is the intent of Seller and acknowledged by Purchaser that the
sale of the Property will be exempt from the provisions of the Federal
Interstate land Sales Full Disclosure Act under the exemption
applicable to the sale or lease of Lot(s) to any person who acquires
such Lot(s) for the purpose of engaging in the business of
constructing residential improvements and homes. Purchaser hereby
represents and warrants that Purchaser is acquiring the Lot(s) for
such purposes. By placing initials next to this paragraph, Purchaser,
or the representative of Purchaser executing this Agreement on its
behalf, specifically acknowledges that it has read this paragraph and
has made the representations and warranties contained herein.
17.21.2 Primary Business.
-------------------------
Purchaser further represents and warrants to Seller that
Purchaser's primary business is in the construction and sale of new
homes for profit and that its purchase of the Lot(s) and Units is for
such purposes. By placing initials next to this paragraph, Purchaser,
or the representative of Purchaser executing this Agreement on its
behalf, specifically acknowledges that it has read this paragraph and
has made the representations and warranties contained herein.
17.22 Press Releases.
---------------------
Purchaser and Seller agree that neither party shall make any statement
or release to the media regarding this Agreement or the terms and
provisions hereof unless the content and timing of said statement or
release shall have been approved by the other party in writing, which
approval shall not be unreasonably withheld, conditioned or delayed.
17.23 Recommendation of Legal Review.
-------------------------------------
Each party acknowledges that it has been recommended to retain
competent legal counsel to review and examine this Agreement and all other
documents relating to this Agreement.
17.24 INTENTIONALLY OMMITTED
17.25 INTENTIONALLY OMMITTED
17.26 INTENTIONALLY OMMITTED
IN WITNESS WHEREOF, the parties have executed this Purchase and Sale
Agreement on the dates set forth below.
17
SELLER:
Villas at Cherry Hills, LLC, a Colorado limited liability
company
By: /s/Xxxxxxx X. Xxxxx
----------------------------------
Name: Xxxxxxx X. Xxxxx
----------------------------------
Title: E.V.P.
----------------------------------
Date: 4/21/2003
----------------------------------
PURCHASER:
XXXXXXXX HOMES CORPORATION,
a Colorado corporation
By: /s/ Xxx X. Xxxxx
----------------------------------
Name: Xxx X. Xxxxx
----------------------------------
Title: President
----------------------------------
Date: 4/21/2003
----------------------------------
18
EXHIBIT A
---------
TO
PURCHASE AND SALE AGREEMENT
(Villas at Cherry Hills)
[List Addresses and Legal Descriptions]
19
EXHIBIT B
---------
TO
PURCHASE AND SALE AGREEMENT
(Villas at Cherry Hills)
Title Commitment
RESERVATIONS, RIGHTS AND RESTRICTIONS
-------------------------------------
See copy of Schedule B -- Section 2 to Title Commitment attached hereto.
To be inserted upon Receipt
20
EXHIBIT C
---------
TO
PURCHASE AND SALE AGREEMENT
(Villas at Cherry Hills)
OBLIGATIONS ASSUMED THAT
------------------------
COMPRISE THE PURCHASE PRICE
---------------------------
1. Xxxxxxx Money Deposits from purchasers
--------------------------------------
2. Land Construction and Land Debt
-------------------------------
3. Unit Construction Financing
---------------------------
4. Subcontractor Payables
----------------------
5. Land Investor Debt Obligations
------------------------------
21
