OPTION TO PURCHASE
Exhibit 10.21
This Option to Purchase (the “Option”) is made and entered into as of this 28th day of
January, 2009, by and between S. Xxxxx Xxxxxxxx, whose address is X.X. Xxx 000, Xxxxxxxx, XX 00000
(hereinafter collectively referred to as “Seller”) and O’Gara Training and Services, LLC, whose
address is 000 X. Xxxx Xxxx Xxx, Xxxxxxxxxx, XX 00000 (hereinafter referred to as “Purchaser”).
1. GRANT OF OPTION. In consideration of the payment of Fifty Thousand and No/100
Dollars ($50,000.00) (“Option Payment”), Seller hereby grants to Buyer the exclusive right and
option to purchase approximately 325 acres (the “Property”), located in Xxxxxxxxxxxx County,
Virginia, adjacent to the property owned by the Industrial Development Authority of Xxxxxxxxxxxx
County, Virginia that contains a 50,000 square foot shell building (“County Property”) and further
described as tax parcel number 35-106, Seller shall provide a more complete legal description.
Purchaser may exercise its rights hereunder at any time during the term of this Option by giving
Seller written notice of exercise. Upon the full execution of this Option, Xxxxxxxxx Xxxxxxx,
Esq., as the holder of the Deposit under the Prior Contract (as hereinafter defined) is hereby
directed by Purchaser and Seller to pay over the full amount of the Deposit to Seller as the Option
Payment.
2. TERM. Unless Purchaser has exercised its rights and options under paragraph 1, the
term of this Option shall expire at 5:00 p.m. on January 28, 2010.
3. PURCHASE PRICE. The “Purchase Price” is TWO MILLION FIVE HUNDRED THOUSAND Dollars
($2,500,000.00), payable by Purchaser as follows:
(a) At Settlement, Purchaser shall issue Seller a Promissory Note (“Note”) in the principal
amount of Two Million Three Hundred Thousand Dollars ($2,300,000.00) amortized for a period of 30
years at an interest rate of FIVE Percent (5%) per annum payable in monthly installments of Twelve
Thousand Three Hundred Forty Six and ninety cents ($12,346.90). A Balloon Payment for the
outstanding Principal Balance and all accrued but unpaid interest shall be due FIVE (5) years from
the date payments begin. The first payment is due the earlier of, three months following
Settlement or once income is derived from the use of the property. The Note shall be secured by a
Second Priority Deed of Trust, in form and substance reasonably agreed upon by Seller and
Purchaser, granted by the Purchaser encumbering the Property. Purchaser agrees to grant Seller a
Second Priority Deed of Trust, in form and substance reasonably agreed upon by Seller and
Purchaser, over the County Property (as hereinafter defined) to further secure the Note. Purchaser
further agrees that the amount secured by the First Priority Deed of Trust encumbering the Property
and the County Property shall not exceed the acquisition cost of the County Property plus
$2,000,000 for improvements to the Property, without the consent of Seller.
(b) The balance, $200,000, to be paid by Purchaser in cash, or by wire transfer, a cashier’s,
certified or savings association check at the Settlement.
4. SETTLEMENT; POSSESSION. Settlement shall be made at the office of Purchaser’s
attorney within five days following the exercise of the option. Possession shall be given at
Settlement, unless otherwise agreed in writing by the parties. At Settlement, the Seller shall
deliver to Purchaser (a) the Deed (as hereinafter defined); (b) an Affidavit as to the absence
of mechanic’s liens and (c) a Certificate of Non-Foreign Status as required by Section 1445 of
the Internal Revenue Code of 1986. The Seller shall pay the costs of preparing the Deed and
grantor’s tax. The Purchaser shall pay all costs and expenses incurred in connection with its
examination of title to the Property, and the Survey, if any, and all premiums charged by
Purchaser’s title insurance company. Real estate taxes shall be prorated between the Seller and
Purchaser as of the date of Settlement. Purchaser shall pay all other customary and normal
Purchaser costs and expenses associated with Settlement, including cost to examine title. Seller
shall reserve a utility easement over the Property to provide power to Seller’s adjacent pond and
farm at a location reasonably satisfactory to Purchaser and Seller. At Settlement, Purchaser and
Seller entering into a reasonably satisfactory easement agreement over that portion of the property
owned by Seller adjacent to the Property shown on Exhibit B, attached hereto and incorporated
herein, to allow the required Safety Danger Zones (SDZ) associated with the small arms range that
Purchaser intends to locate on the Property at the location designated by Purchaser. In the event
that Seller receives a bona fide offer to purchase the Property during the term of this Option,
Seller shall notify Purchaser in writing and Purchaser shall have thirty (30) days from the date
that Purchaser receives such notice to either terminate this Option or exercise the Option as set
forth in paragraph 1 hereof. In event Purchaser fails to respond within 30 days any rights under
this contract are waived and the Option is assumed terminated.
5. RISK OF LOSS. All risk of loss or damage to the Property by fire, windstorm,
casualty, or any other cause is assumed by Seller until Settlement.
6. TITLE. At Settlement, Seller shall convey the Property to Purchaser by General
Warranty Deed, with release of dower if applicable, containing English covenants of Title,
marketable and insurable title to the Property free of all encumbrances, tenancies, and liens (for
taxes or otherwise), other than (i) easements, restrictions, conditions and other matters of record
as to the Property as of the date of the Option, (ii) any assessments against the Property, and
(iii) the zoning of the Property.
7. DELIVERY OF DOCUMENTS. Within ten (10) days of the date of this Option, Seller
shall deliver to Purchaser copies of the following documents pertaining to the Property to the
extent in Seller’s possession:
(a) All real estate tax bills and assessed values for the current and previous two years.
(b) Any boundary survey and title documents in Seller’s possession.
(c) Any licenses, permits and approvals pertaining to the Property in Seller’s possession.
(d) Any plans and specifications for the Property and/or improvements thereon.
(e) Any soil reports, engineering and physical inspection reports.
(f) Any environmental studies.
(g) Copies of any leases and vendor contracts.
(h) Any existing transferable warranties.
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8. PRIOR ACCESS. Purchaser and his agents shall have the right to enter onto the
Property for purposes of engineering, estimating, surveying and such other work, so long as such
studies do not result in a change in the character or topography of the Property. Purchaser shall
hold Seller harmless against any loss or liability to person or property resulting from such entry
on the Property and conduct of such entry.
9. SELLER REPRESENTATIONS. The Seller represents and warrants as of the date hereof
and by appropriate certificate delivered at Settlement that:
(a) Seller has no knowledge of any planned public improvement which may result in a special
assessment being made against the Property.
(b) No governmental agency or tenant has served any notice on the Seller regarding, nor does
the Seller have knowledge of any planned notice requiring, repairs, alterations or corrections of
any existing condition on the Property.
(c) Seller has no knowledge of any pending or threatened proceedings for condemnation or the
exercise of the right of eminent domain as to any part of the Property or for the limiting or
denying of any right of access thereto.
(d) Seller has no knowledge of, nor has it received any notice of, any special taxes or
assessments relating to the Property or any part thereof.
(e) The Property is zoned A-1, that Seller is unaware of any pending or any proposed
proceedings which would alter said zoning.
(f) The Property is free from all building orders and that the Property does not violate the
building, fire and safety codes of city, county, state and/or federal authorities with jurisdiction
in these matters.
(g) Water, electric, gas, telephone and sanitary sewer service is available at the Property or
in the right of way abutting the Property and that no utility lines servicing the Property encroach
on abutting properties without appropriate easements.
(h) There does not exist any condition or circumstance nor is there any litigation threatened
or pending which will or does materially and adversely affect the use and operation of the Property
for Purchaser’s expressed use or affect Seller’s obligations or ability to perform hereunder.
(i) To the best of Seller’s knowledge, there has not been a release or a disposal, or any
event at, on or in connection with the Property which would be deemed a release or a disposal, of
Hazardous Material (as defined below), and the Property is not in violation of any Environmental
Law (as defined below). Neither Seller nor, to the best of the knowledge of Seller, any third
party has used, generated, stored, or disposed of on, under or about the Property, or transported
to or from it, any Hazardous Materials other than materials commonly used and stored, in accordance
with all Environmental Laws at similar properties. Seller has received no notice from any
governmental agency of any investigation or proceeding by such agency concerning the presence or
alleged presence of Hazardous Materials on the Property. There are no underground storage tanks or
associated product piping systems at the Property, and the Property does not include any “fill” or
any area which is or has been used as a garbage or rubbish
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disposal site. No portion of the Property is located in a flood hazard area. The term
“Environmental Law” includes any federal, state or local law, ordinance, or regulation pertaining
to the health, industrial hygiene, waste disposal, or the environment, including, without
limitation, the Comprehensive Environmental Response, Liability and Xxxxxxxxxxxx Xxx, 00 X.X.X.
§0000 et seq., the federal Superfund Amendments and Reauthorization Act and other so-called
“Superfund” or “Superlien” laws, the federal Resource Conservation and Recovery Act, the federal
Clean Air Act, the federal Water Pollution Control Act, the federal Insecticide, Fungicide and
Rodenticide Act, the federal Pesticide Act, the federal Toxic Substances Control Act, the federal
Safe Drinking Act, the federal Hazardous Materials Transportation Act, and any amendments thereto
and regulations adopted and publications promulgated pursuant thereto, and any other federal, state
or local statute, law, ordinance, code, rule, regulation, order or decree regulating, relating to
or imposing liability for Hazardous Materials. The term “Hazardous Materials” includes without
limitation oil and petroleum products and derivatives thereof, asbestos (friable or otherwise),
polychlorinated biphenyls (“PCB”s), radon gas, urea formaldehyde, lead, flammable explosives,
hydrocarbons, radioactive materials and any hazardous, toxic or dangerous substance, waste or
material or any solid waste, pollutant or contaminant, including, without limitation, any
hazardous, toxic or dangerous substance, waste or material or any solid waste, pollutant or
contaminant classified as such under any Environmental Law. An adjacent parcel formerly owned by
Xxxxxxx Corp. was cited for environmental contamination in the 1990s. To the best of Seller’s
knowledge the contamination has been contained to that parcel and the parcel has been cleaned and
restored.
Seller’s warranties contained in this Paragraph 9 shall survive Closing. The warranties contained
herein shall not be limited by any other provision contained herein, or by any rights of Purchaser
to inspect the Property.
10. DEFAULT. If either Seller or Purchaser defaults under this Option, the defaulting
party, in addition to all other remedies available at law or in equity, shall be liable for the
brokerage fee set forth below and for any damages and all expenses incurred by the non-defaulting
party, to include but not limited to attorney fees and court costs.
11. BROKERAGE FEE. Seller and Purchaser agree that X X Xxxxx and Associates LLC is
the sole Broker involved in this transaction and for such services shall receive a commission
payable at Settlement, equal to three percent (3%) of the gross sale price, to be paid two percent
(2%) by Purchaser and one percent (1%) by Seller.
12. REPRESENTATION. X X Xxxxx and Associates LLC represents the Purchaser and has
acted on behalf of Purchaser in this transaction.
13. NOTICES. Any notice, request or demand required or permitted to be given pursuant
to this Option shall be in writing and shall be deemed sufficiently given if delivered by hand by
messenger at the address of the intended recipient, sent prepaid by Federal Express (or a
comparable guaranteed overnight delivery service), or deposited in the United States first class
mail (registered or certified, postage prepaid, with return receipt requested). Any such notice,
request or demand so given shall be deemed given on the date of deposit in the United States Mail
or any guaranteed overnight delivery service as the case may be.
For the Seller:
|
S. Xxxxx Xxxxxxxx | Xxxxxxxxx Xxxxxxx Xx. | ||
| XX Xxx 000 | Xxxxxxx & Xxxxxx | |||
| Xxxxxxxx, Xx. 00000 | X.X. Xxx 000 | |||
| Xxxxxxxxxxxx, XX 00000 |
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For the Purchaser:
|
O’Gara Training and Services, LLC | |||
| 000 X. Xxxx Xxxx Xxx | ||||
| Xxxxxxxxxx, XX 00000 | ||||
| Attention: Xxx Xxx | ||||
| FAX # (000) 000-0000 | ||||
With a Copy to:
|
The O’Gara Group, Inc. | |||
| 0000 Xxxx Xxxxxx Xx. | ||||
| Xxxxxxxxxx, XX 00000 | ||||
| Attention: Xxxxxxx X. X’Xxxx | ||||
| FAX # (000) 000-0000 | ||||
For the Agents:
|
X X Xxxxx & Associates LLC | |||
| XX Xxx 00000 | ||||
| Xxxxxxxx, XX 00000 |
14. MISCELLANEOUS. (a) This Option shall be interpreted by the laws of the
Commonwealth of Virginia. (b) Seller shall pay any “roll-back” taxes.
15. TERMINATION OF REAL ESTATE PURCHASE CONTRACT. Upon the execution of this Option,
the Real Estate Purchase Contract, dated December 9, 2008 (“Prior Contract”), by and between
Purchaser and Seller is hereby terminated.
16. EXPIRATION. This Option shall have no force and effect unless Seller executes
this Option by 2:30 pm on January 30, 2009.
WITNESS THE FOLLOWING SIGNATURES AND SEALS:
| S. Xxxxx Xxxxxxxx | O’Gara Training and Services, LLC | |||||||||
BY: /s/ S. Xxxxx Xxxxxxxx
|
(SEAL) | BY: /s/ Xxxxx X. Xxx
|
(SEAL) | |||||||
Title:
|
Title: President | |||||||||
1/30/2009, 12:50 PM
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