UNITED STATES PROPERTIES, INC.
National Real Estate Acquisitions
May 19, 1997
Executive Offices
000 Xxxx 00xx Xxxxxx
Xxxxx 00, 00xx Xxxxx
Xxx Xxxx, XX 00000
Operations
Xxx Xxxxxxx Xxxxxxxx Xxxx
Xxxxxx, XX 00000
Branch Office
0000 Xxxx Xxxxxx Xxxxxx
Xxxxx 000
Xxxxx, XX 00000
Xx. Xxxx XxXxx
President
Highpoint Country Club Golf Associates, Inc.
P. 0. Box 1154
Montague, NJ 07827
Dear Xx. XxXxx,
This letter specifies the terms and conditions (Term Sheet attached) under
which United States Properties, Inc. ("USPI") will agree to purchase certain
residential building lots, completed homes and undivided acreage located at the
property known as Highpoint Country Club.
By executing this non-binding Letter of Intent, by Highpoint Country Club
Golf Associates, Inc. indicates its intent to accept the terms and conditions
specified in the attached Term Sheet. Upon the receipt of the executed this
non-binding Letter of Intent, USPI will pay an xxxxxxx deposit of $25,000.00 to
be held in escrow by Xxxxxxx, Xxxxxx & Xxxxxxx, P.C.
This non-binding Letter of Intent will expire at the close of business on
Friday, May 23, 1997, unless executed by Highpoint Country Club Golf Associates,
Inc. and delivered to USPI prior to that date.
Sincerely,
/s/ Xxxxxxx X. Xxxxxx
Xxxxxxx X. Xxxxxx
President
Highpoint Country Club Golf Associates, Inc.
By: /s/ Xxxx XxXxx
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Title: President
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Date: 5/20/97
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UNITED STATES PROPERTIES, INC.
Purchase of Highpoint Country Club Building Lots
Term Sheet
Property: 259 sub-divided residential building lots, 3 single-family
homes and an undivided 79 acre parcel on a total of
approximately 1,000 acres of land located on County Route
000, Xxxxx Xxxx, Xxxxxxxx Xxxxxxxx, Xxxxxx Xxxxxx, Xxx
Xxxxxx (the "Property").
Of the 259 residential building lots, 221 are building lots
not on a lake ("Interior Building Lots") and 38 are building
lots on a lake ("Lake Front Building Lots").
Of the three single-family homes, two are constructed on two
lake front sites and one is constructed on one interior
site.
Seller: Principal owners: Highpoint Country Club Golf Associates,
Inc. and Chubb Construction Company, Inc. ("Seller").
Purchaser: A United States Properties, Inc. ("USPI") special purpose
entity ("Purchaser").
Purchase Price: $6,496,250:
a. $4,420,000 for the 221 Interior Building Lots.
b. $1,450,000 for the 38 Lake Front Building Lots.
c. $ 330,000 for the 3 single family homes.
d. $ 296,250 for the 79 acre parcel.
The location of the individual building lots, homes and
acreage is specified on Schedule A (attached).
The purchase price per individual building lot and home is
specified on Schedule B (attached).
Payment Terms: a. $2,608,362 in the form of the assumption and/or payoff
by the Purchaser of the notes and/or obligations
specified in Schedule C (attached).
b. $1,514,138 in a second mortgage held by the Seller.
c. $2,373,750 in the form of approximately 395,625 shares
of restricted USPI stock valued at the close of
business of the day immediately preceding the
acquisition of the Property by the Purchaser ("Stock").
Second Mortgage: The second mortgage held by the Seller in the amount of
$1,514,138 will have a five (5) term without any interest
cost to the Purchaser.
The second mortgage will be re-paid in cash by the Purchaser
from the proceeds of the closing of the sale of homes built
on individual building lots by the Purchaser. The Seller and
the Purchaser prior to closing will agree upon the schedule
of such re-payment.
Issue of the Stock: The Purchaser will issue the Stock to the institutions or
individuals specified by the Seller in proportion to the
type of assets purchased by the Purchaser. The portion of
the stock allocated to the purchase of the Interior Building
Lots, Lake Front Building Lots and the 79 acre parcel will
be agreed to by the Seller and the Purchaser prior to
closing.
The Purchaser will issue the Stock to the institutions or
individuals specified by the Seller related to the Interior
Building Lots and the Lake Front Building Lots upon the
closing of the sale of homes built on those individual
building lots by the Purchaser.
The Purchaser will issue the Stock to the institutions or
individuals specified by the Seller related to the 79 acre
parcel upon the closing of the purchase of the Property by
the Purchaser.
Stock Lock-Up and Any Stock issued by the Purchaser to the Seller will be
Purchase Agreement: governed by the terms and conditions of a "Lock-Up and
Purchase Agreement", a form of which is specified as
Schedule D (attached).
Among other provisions, the Lock-Up and Stock Agreement will
specify the period that the Seller must hold any Stock
issued by the Purchaser and the terms of the release of such
restriction.
Capital The Seller will provide roads and related capital
Improvements: improvements to the Property as specified in Schedule E
(attached) at its sole expense. Purchaser will advance the
costs of such improvements to the Seller and will deduct the
amount so advanced from the cash re-payment of the second
mortgage related to the Interior Building Lots and the 79
acre parcel.
Marketable Title: Seller warrants that it shall convey good, marketable and
insurable fee simple title to the Properties to the
Purchaser by a [General Warranty Deed].
Representations: Seller knows of no existing conditions with respect to the
Properties or their operations which violate any restrictive
covenants, zoning, environmental or other ordinance, rule,
statute or governmental law or regulation.
Real Estate Purchaser has no obligation to pay any real estate
Commissions: commissions to any real estate broker, agent or other
individual or institution demanding payment. Any such demand
of payment is the sole obligation and responsibility of the
Seller.
Right of First Seller grants to Purchaser a right of first refusal for any
Refusal: bone-fide third-party offer to purchase the 18 hole golf
course.
Closing Cost: The following closing costs are to be allocated as
indicated:
a. Title insurance premium: Purchaser
b. Realty Transfer tax: As customary
c. Recording costs: Purchaser
d. Legal fees: Each party pay their own
Closing: Closing date [June 30, 1997].
SCHEDULE A
Property Map
SCHEDULE B
Purchase Price Per Individual Building Lots and Homes
Assets Bid Offering Price
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Bid
Number of Price Per -----------------------------------------
Description Units Unit Cash Stock Total
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Lots
Offer Per Interior Lot $ 20,000 $ 12,500 $ 7,500
Interior Unimproved Lots 160 $ 20,000 $ 2,000,000 $ 1,200,000 $ 3,200,000
Interior Improved Lots 61 $ 20,000 $ 762,500 $ 457,500 $ 1,220,000
=========================================================================
Total Interior Lots 221 $ 2,762,500 $ 1,657,500 $ 4,420,000
Offer Per Standard Lake Front Lot $ 35,000 $ 20,000 $ 15,000
Improved Standard Lake Lots 28 $ 35,000 $ 560,000 $ 420,000 $ 980,000
Offer Per Non-Standard Lake Front Lots
Partially Underwater Lake Lots 4 $ 10,000 $ 40,000 $ -- $ 40,000
Lake Lot 66, Block 1855 1 $ 50,000 $ 50,000 $ -- $ 50,000
Lake Lot 25, Block 1855 1 $ 100,000 $ 100,000 $ -- $ 100,000
Lake Lot 38, Block 1855 1 $ 50,000 $ 50,000 $ -- $ 50,000
Lake Lot 39, Block 1855 1 $ 50,000 $ 50,000 $ -- 50,000
lake Lot 13, Block 1856 1 $ 100,000 $ 100,000 $ -- $ 100,000
Lake Lot 14, Block 1856 1 $ 80,000 $ 80,000 $ -- $ 80,000
=========================================================================
Total Non-Standard Lake Front Lots 10 $ 440,000 $ 470,000 $ 470,000
=========================================================================
Total Lake Front Lots 38 $ 1,030,000 $ 420,000 $ 1,450,000
Total Subdivided Lots 259 $ 3,792,500 $ 2,077,500 5,870,000
Homes
Lakefront 2 $ 125,000 $ 250,000 $ -- $ 250,000
Interior 1 $ 80,000 $ 80,000 $ -- $ 80,000
=========================================================================
Total Homes 3 $ 330,000 $ -- $ 330,000
Acreage
Unsubdivided Acres (Block 18, Lot 1) 79 $ -- $ 296,250 $ 296,250
------------------------------------------------------------------------------------------------------------------------------------
Total Bid Price $ 4,122,500 $ 2,373,750 $ 6,496,250
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SCHEDULE C
Notes or Obligations of Seller to be Paid by Purchaser
SCHEDULE D
Form of Lock-Up and Purchase Agreement
SCHEDULE E
Capital Improvements
