RIGHT OF FIRST REFUSAL AGREEMENT
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THIS RIGHT OF FIRST REFUSAL AGREEMENT ("Agreement") is made and
entered into this 12th day of August, 1992, between INCO SECURITIES CORPORATION
("Corporation") and XXXXXXX X. XXXXX, XXXX X. XXXXXXX, XXXXXX X. XXXXX, XXXXXX
XXXX and XXXXXX XXXXXX (collectively the "Tenants").
R E C I T A L S
WHEREAS, the Tenants have each acquired an undivided interest in
certain real property located in Arapahoe County as more fully described on
Exhibit A attached hereto and made a part hereof ("Property"); and
WHEREAS, the Tenants have entered into that certain Tenancy in Common
Agreement dated August 12, 1992 ("Tenancy in Common Agreement") whereby certain
rights and responsibilities of the Tenants are set forth; and
WHEREAS, the Corporation has an interest in maintaining the integrity
and potential development of the Property; and
WHEREAS, the Corporation and the Tenants, by this Agreement, desire to
set forth the method and procedures by which the Corporation may exercise
certain rights in connection with the Property.
NOW THEREFORE, in consideration of the premises and of the mutual
benefits to accrue to each of the parties hereto, the parties have agreed and do
hereby agree as follows:
1. Granting of Right of First Refusal. In consideration of their
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receipt of $198,000 (the "First Refusal Premium") , the Tenants hereby grant,
for a period of 99 years from the date noted above, to the Corporation, in
accordance with the terms of this Agreement, the exclusive right of first
refusal on the Property, such right of first refusal being limited only as
described under Section 4 below.
2. Procedures for Exercise of Right of First Refusal.
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a. First Notice. In the event any Tenant shall desire to sell
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all or any portion or otherwise transfer its interest in the Property to any
third party and it shall have received a bona fide offer therefore, which is
acceptable to it, it shall, not less than 60 days prior to the date of the
proposed sale or transfer, give written notice of such offer to the Corporation
("First Notice"). The Notice shall state that a bona fide offer has been
received by the selling Tenant from such third party and shall contain the
following information:
(1) The portion of the selling Tenant's interest in the
Property offered for sale;
(2) The price, terms, and conditions of the proposed
sale;
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(3) The name and address of the third party to whom such
Property interest is proposed to be sold. The First notice shall further contain
an affirmative offer by the selling Tenant granting the Corporation the option
to purchase the selling Tenant's interest in the Property, or the portion
thereof offered for sale, upon the terms and conditions outlined in this
Agreement.
b. Purchase Price. Following receipt of the First Notice as
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outlined in a. above, the Corporation shall have the option, for the period of
60 calendar days from the date of such First Notice within which to exercise the
option to purchase the selling Tenant's interest in the Property offered for
sale. The Corporation may, during such 60 calendar day period, by written notice
("Second Notice") to the selling Tenant, elect to purchase the selling Tenant's
Property interest either:
(1) Upon the terms and conditions of the bona fide offer
received by the selling tenant as set forth in the First Notice; or
(2) By cash purchase of the selling Tenant's Property
interest at its appraised value, as determined by an M.A.I. appraiser mutually
chosen by the selling Tenant and the Corporation. If an appraiser cannot be
agreed upon within 15 business days of the First Notice, the selling Tenant and
the Corporation shall each choose an M.A.I. appraiser and those two M.A.I.
appraisers shall choose a third M.A.I. appraiser who shall provide the selling
Tenant and the Corporation with the appraised value. If the M.A.I. appraisers
chosen cannot agree on a third M.A.I. appraiser, the selling Tenant and the
Corporation shall each obtain an M.A.I. appraisal and the appraised value shall
be the average of the two appraisals. If the Corporation requests an appraisal
of the Property and a single appraisal is done, the costs of the appraisal shall
be borne by the Corporation. If a second appraisal is required as outlined
above, the costs of the appraisals shall be borne equally by the selling Tenant
and the Corporation.
c. Title Commitment. Selling Tenant shall, within 10 business
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days after sending the First Notice, furnish to the Corporation, at selling
Tenant's expense, a current commitment ("Commitment") for an owner's title
insurance policy in an amount equal to the price in the First Notice (the amount
to be adjusted to the actual Purchase Price when that is determined) showing
merchantable title to be vested in selling Tenant, free and clear of all liens
and encumbrances, subject only to a lien for real property taxes for the year of
closing, payable in the following year, and building, zoning, and other
applicable ordinances and regulations of Arapahoe County. The Commitment shall
be accompanied by copies of all instruments listed in the schedule of exceptions
thereto and any recorded instruments described in the schedule of requirements
thereto.
d. Title Defects. Within 20 business days after the
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Corporation's receipt of the Commitment (together with copies of the recorded
instruments referred to therein), the Corporation shall give selling Tenant
notice of all title defects shown thereon or otherwise determined to exist by
the Corporation, specifying which defects the Corporation consent to as
permitted exceptions and which defects are not permitted exceptions. Failure to
give notice of title defects as set forth herein shall be a waiver thereof. In
the event the Corporation gives the selling Tenant notice of title defects which
are not permitted exceptions, the selling Tenant shall, at its sole cost and
expense, cure such defects, which cure may, if acceptable to the Corporation,
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include the obligation to obtain title insurance protection for the Corporation
and its successors and to pay any additional premium or cost for such
protection. If each of said defects is not cured by the date of Closing (as such
time may be extended by the Corporation) , the Corporation may at its option (i)
terminate its decision to exercise its right of first refusal, or (ii) accept
the uncured defect as a permitted exception with a commensurate reduction in the
purchase price to cover the cost of curing the defect, or if the defect is
incurable, to reflect the reduction in the value of the Property due to the
defect. In the event of such termination, all other obligations of the
Corporation and the selling Tenant under that particular exercise of the
Corporation's right of first refusal shall be terminated.
e. Closing. Following the Second Notice, the closing on the
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transfer of the Property interest from the selling Tenant to the Corporation
("Closing") shall take place at the offices of the Corporation within 10
business days of the receipt of the Second Notice by the selling Tenant. Such
transfer shall occur by special warranty deed. As soon as possible after
Closing, selling Tenant shall cause to be delivered to the Corporation, at
selling Tenant's cost and expense, an owner's title insurance policy insuring
the title of the Corporation in accordance with the Commitment. All taxes, fees,
and special assessments shall be prorated to the date of Closing.
f. Credit Against Purchase Price. Any purchase of a Tenant's
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Property interest by the Corporation, whether under this Agreement or otherwise,
shall include a credit against the purchase price equal to the percentage
interest in the Property being purchased multiplied by the sum of (1) any
subdivision costs expended by the Corporation pursuant to Section 5. below, and
(2) 80% of the First Refusal Premium. In no event, however, may such credit
exceed the purchase price.
g. Direct Purchase by the Corporation. Except in the case of
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death, bankruptcy or incompetence, which is subject to the provisions of Section
9.c of the Tenancy in Common Agreement, nothing contained herein shall prohibit
any Tenant desiring to sell all or any portion or otherwise transfer its
interest in the Property from separately negotiating and selling such Property
interest to the Corporation directly, regardless of the existence of a third
party offer.
3. Non-Exercise or Default. In the event that the Corporation
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elects not to exercise the option to purchase the Property interest being
offered or defaults in its obligations under this Agreement, selling Tenant
shall have the right to sell and convey such interest to the third party
strictly in accordance with the terms of the Notice provided to the Corporation
pursuant to this Agreement. If no such conveyance is made within the 60 calendar
day period following the expiration of the option period, a new notice of sale
shall be required in the manner provided herein. In the event the Corporation
fails to close the purchase of the selling Tenant's interest in the Property
after properly notifying the selling Tenant of its agreement to so purchase and
after full compliance by selling Tenant of its obligations herein, the selling
Tenant may either enforce specific performance against the Corporation, or treat
such failure to close as a default by the Corporation, and immediately
re-institute its rights under this paragraph allowing it to sell the Property
interest to the third party, with no further duty to grant the Corporation a
right of first refusal on the Property offered for sale.
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4. Limitation on Scope of Right of First Refusal. The
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Corporation's right of first refusal under this Agreement shall be limited to
those events involving bona fide offers received by Tenants from third parties.
The right of first refusal hereby granted is not effective in the event of a
transfer to a Tenant or Tenants as a result of a Tenant's death, incompetence or
bankruptcy, such right of first refusal having been previously granted to the
Tenants pursuant to the Tenancy in Common Agreement. The right of first refusal
hereby granted shall apply, however, if no Tenant exercises the applicable right
of first refusal so granted under the Tenancy in Common Agreement.
5. Subdivision Rights. As described in the Tenancy in Common
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Agreement, the parties hereto acknowledge that it is desirable to pursue
subdivision of the Property, but that the funds required for such subdivision
may be substantial. In the event that the Corporation guarantees payment of and
pays the costs therefore, Tenants agree to cooperate in the subdivision
procedures and to provide such approvals as may be necessary to accomplish the
Property's subdivision in the manner recommended by the Corporation. If, in the
reasonable opinion of the Corporation, any Tenant does not provide such
cooperation and those Tenants controlling greater than 50% of the Property agree
in writing, the Corporation may notify the non-cooperating Tenant of the
Corporation's desire to purchase and may purchase such Tenant's Property
interest in the manner described below. The Tenants also agree that upon
subdivision of the Property, and payment by the Corporation of all subdivision
costs, they will sell to the Corporation their interests in any portion of the
Property requested by the Corporation so long as the total area sold to the
Corporation its successors or assigns pursuant to this provision, does not
constitute more than 80% of the Property's acreage. The price and terms for any
purchase of the Property, or portion thereof, under this Section 5 shall be as
outlined in 2.b.(2), 2.c., 2.d., 2.e., 2.f. and 2.g. above. For purposes of this
Section 5 only, the First Notice referenced in 2.b.(2) shall mean the notice to
the non-cooperating or selling Tenant or Tenants as described herein.
6. Covenants Running With the Land. This Agreement and each of
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the provisions hereof touch and concern the Property and shall be covenants
running with the land, shall be binding on the parties hereto and their
respective successors as owners or interest in the Property, and shall inure to
the benefit of and be enforceable by the parties hereto and their respective
successors as owners of the Property and interests therein. Any transfer or
encumbrance of the Property shall be subject to the terms and provisions hereof
and to the rights and obligations of the parties hereto. Any transfer, lease, or
encumbrance of any interest in the Property shall be subject to the terms and
conditions of this Agreement and the rights and obligations created hereby.
7. Remedies. In addition to any remedies provided bv this
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Agreement, the parties hereto may enforce this Agreement by specific performance
or any other method allowed by law.
8. Notices. Any notice required or permitted to be given hereunder
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shall be personally delivered or sent by first class mail, postage pre-paid to
the address of the party set forth below and shall be deemed given on the date
of delivery or three business days after the date of mailing, whichever is
earlier. A party's address for notices may be changed and a new party's address
may be added by written notice to all other parties in accordance with this
paragraph.
INCO Securities Corporation
c/c Xxxxxx Xxxxxxxxx
Xxx Xxx Xxxx Xxxxx
Xxx Xxxx, XX 00000
Xxxxxx Xxxx
0000 Xxxxxxxx Xx
Xxxxxxx
Xxxxxxxx 00000
Xxxx X. Xxxxxxx
0000 X. Xxxxxxx
Xxxxxx, XX 00000
(000) 000-0000
Xxxxxx X. Xxxxx
000 00xx Xxxxxx, #000
Xxxxxxx, XX 00000
(000) 000-0000
Xxxxxxx X. Xxxxx
Western Aggregate, Inc.
00000 Xxxxxxx 00
Xxxxxxx, XX 00000
Xxxxxx Xxxxxx
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9. Governing Law. This Agreement shall be governed by the laws of
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the State of Colorado.
10. Modification. This Agreement may not be amended or modified,
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except in writing executed by all of the parties to this Agreement.
11. Severability Provisions. In the event that any portion of this
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Agreement shall be declared invalid by order, decree, or judgment of a court,
this Agreement shall be construed as if such portion had not been inserted
herein, except when such construction would operate as an undue hardship on any
party hereto or constitute substantial deviation from the general intent and
purpose of the parties that are reflected in this Agreement.
12. Assignment. Except as otherwise provided in this Agreement, no
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assignment may be made of this Agreement to any other party by Tenant without
the express written consent of all parties hereto. Any such attempt to
assignment shall be determined to be null and void and of no force and affect.
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IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement on the date noted above.
ATTEST: INCO SECURITIES CORPORATION
By: /s/ Xxxxxxx Xxxxx
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Vice President
STATE OF COLORADO )
) ss.
COUNTY OF )
The foregoing instrument was acknowledged before me this 12th day of
August, 1992 by Xxxxxxx Xxxxx as Vice President of INCO Securities Corporation.
WITNESS my hand and official seal.
My commission expires: Jan. 17, 1993
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/s/ Xxxxx X. Xxxxxxx
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Notary Public
/s/ Xxxxxx Xxxx
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Xxxxxx Xxxx
STATE OF COLORADO )
) ss.
COUNTY OF )
The foregoing instrument was acknowledged before me this 12th day of
August, 1992 by Xxxxxx Xxxx.
WITNESS my hand and official seal.
My commission expires: Jan. 17, 1993
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/s/ Xxxxx X. Xxxxxxx
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Notary Public
/s/ Xxxx X. Xxxxxxx
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Xxxx X. Xxxxxxx
STATE OF COLORADO )
) ss.
COUNTY OF )
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The foregoing instrument was acknowledged before me this 12th day of
August, 1992 by Xxxx X. Xxxxxxx.
WITNESS my hand and official seal.
My commission expires: Jan. 17, 1993
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/s/ Xxxxx X. Xxxxxxx
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Notary Public
/s/ Xxxxxx X. Xxxxx
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Xxxxxx X. Xxxxx
STATE OF COLORADO )
) ss.
COUNTY OF )
The foregoing instrument was acknowledged before me this 12th day of
August, 1992 by Xxxxxx X. Xxxxx.
WITNESS my hand and official seal.
My commission expires: Jan. 17, 1993
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/s/ Xxxxx X. Xxxxxxx
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Notary Public
/s/ Xxxxxxx X. Xxxxxx
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Xxxxxxx X. Xxxxxx
STATE OF COLORADO )
) ss.
COUNTY OF )
The foregoing instrument was acknowledged before me this 12th day of
August, 1992 by Xxxxxxx X. Xxxxx.
WITNESS my hand and official seal.
My commission expires: Jan. 17, 1993
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/s/ Xxxxx X. Xxxxxxx
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Notary Public
/s/ Xxxxxx Xxxxxx by Xxxxxxx Xxxxx Attorney In Fact
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Xxxxxx Xxxxxx
STATE OF COLORADO )
) ss.
COUNTY OF )
The foregoing instrument was acknowledged before me this 12th day of
August, 1992 by Xxxxxx Xxxxxx.
WITNESS my hand and official seal.
My commission expires: Jan. 17, 1993
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/s/ Xxxxx X. Xxxxxxx
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Notary Public
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EXHIBIT "A"
NW 1/4 of SW 1/4 of Section 11,
Township 5 South, Range 64 West
of the 6th P.M.
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