Exhibit 10.19
PURCHASE AND SALE AGREEMENT
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THIS PURCHASE AND SALE AGREEMENT ("Agreement") is made effective as of this
12th day of August, 1997, between PGA GOLF DEVELOPMENT, INC., a Florida
corporation ("Seller"), and VISTANA PSL, INC., a Florida corporation
("Purchaser").
RECITALS:
A. Seller has entered into a contract with Callaway Land & Cattle Co. Limited
Partnership ("Callaway"), pursuant to which Seller will acquire certain
real property located in St. Lucie County, Florida, legally described in
Exhibit "A" attached hereto and made a part hereof (the "Option Parcel"),
which is included within The Reserve Development of Regional Impact, as
approved by Development Order dated December 20, 1988 and amended by County
Resolution 89-73 dated March 14, 1989, County Resolution 91-228 dated
November 12, 1991, County Resolution 93-061 dated May 25, 1993, County
Resolution 93-125 dated July 27, 1993, County Resolution 95-195 dated
October 17, 1995, County Resolution 96-014 dated February 13, 1996, and
County Resolution 97-023 dated February 4, 1997, all as now or hereafter
amended (the "Reserve DRI"). A portion of the Option Parcel is also
included within "The Reserve P.U.D." as described in County Resolution
84-129 recorded in Official Record Book 442, Pages 667 through 672, and
County Resolution 94-157, recorded in Official Record Book 966, Pages 1958
through 1964, in the Public Records of St. Lucie County, Florida, both as
now or hereafter amended (the "Reserve P.U.D.").
B. Seller desires to have the Option Parcel developed as, including without
limitation, a golf-oriented vacation ownership resort, including ancillary
facilities and amenities, and limited-service hotel.
C. Seller desires to sell to Purchaser and Purchaser desires to purchase a
portion of the Option Parcel on which Purchaser will develop, market and
operate a golf-oriented vacation ownership resort, including ancillary
facilities and amenities, on the terms and conditions hereinafter set
forth.
NOW, THEREFORE, in consideration of the mutual covenants and agreements
contained in this Agreement, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, Seller and Purchaser
hereby agree as follows:
SECTION 1
AGREEMENT TO SELL; PURCHASE PRICE
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1.1 Agreement to Sell and Convey. Seller agrees to sell and convey to
Purchaser and Purchaser agrees to purchase from Seller, subject to the terms and
conditions set forth below, approximately twenty-five (25) contiguous acres of
the Option Parcel, legally described in Exhibit "B" attached hereto and made a
part hereof, together with all rights and appurtenances pertaining to such land
(collectively, the "Vistana Property"). Purchaser acknowledges that Seller may
direct Callaway to convey the Vistana Property directly to Purchaser at the
Closing (as defined in Section 5.01 below), in which event Purchaser shall
accept the conveyance from Callaway and pay the Purchase Price to Seller as set
forth in Section 1.02 below. Seller shall also convey to Purchaser a non-
exclusive easement, in the form attached hereto as Exhibit "C", over, under, on
and across that certain property described in Exhibit "D" attached hereto and
made a part hereof for purposes of ingress and egress to and from, and
construction, operation and maintenance of utilities serving, the Vistana
Property ("Access and Utility Easement"). The Access and Utility Easement shall
terminate pursuant to its terms upon recording of the Plat as described in
Section 6.02 below and dedication of a portion of the Entrance Road (as defined
in Section 3.02 below) shown thereon to the public, and dedication of the
remainder thereof to the Reserve Association, Inc., which shall accept
maintenance responsibility for said portion of the Entrance Road pursuant to the
Plat and the Maintenance Agreement to be entered into pursuant to Section
4.03(c) below. Seller also agrees to cause its affiliate to convey to Purchaser
a non-exclusive easement, in the form attached hereto as Exhibit "E", over, on
and across Perfect Drive as necessary for access, ingress and egress by
Purchaser, owners of interests in Purchaser's Vacation Resort (as hereinafter
defined), any timeshare or other property owners' association created for the
management and maintenance of Purchaser's Vacation Resort, and tenants of
Purchaser's Vacation Resort, and their respective guests, employees, agents,
contractors, invitees, heirs, personal representatives, successors and assigns,
to the golf club and facilities operated in the Reserve DRI by Seller's
affiliate known as "PGA Golf Club at the Reserve" ("Golf Access Easement").
Seller has also required as a covenant in its contract with Callaway ("Callaway
Agreement") that Callaway, or the property owners' association having
jurisdiction over such roads which is controlled by Callaway, convey a similar
Golf Access Easement to Purchaser at Closing over the private portion of Reserve
Boulevard to Perfect Drive as is necessary for such access, ingress and egress
("Callaway Golf Access Easement"). Seller further covenants and agrees to
provide access to the Learning Center to be constructed by Seller pursuant to
Section 6.10 below for Purchaser, owners of interests in Purchaser's Vacation
Resort, any timeshare or other property owners' association created for the
management and maintenance of Purchaser's Vacation Resort, and tenants of
Purchaser's Vacation Resort, and their respective guests, employees, agents,
contractors, invitees, heirs,
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personal representatives, successors and assigns, over the roads to be
constructed pursuant to the Plat, or by grant of appropriate easements in form
mutually acceptable to Seller and Purchaser upon completion of the Learning
Center, which obligation shall survive the Closing of this Agreement.
1.2 Purchase Price. The purchase price for the Vistana Property
("Purchase Price") shall be calculated and paid as follows:
(a) The total Purchase Price shall be determined by multiplying the
total number of acres or portion thereof in the Vistana Property by ONE
HUNDRED FIFTY THOUSAND AND NO/100 DOLLARS ($150,000.00) per acre.
(b) A minimum of ONE MILLION FIVE HUNDRED THOUSAND AND NO/100
DOLLARS ($1,500,000.00), based on a sum equal to ONE HUNDRED FIFTY THOUSAND
AND NO/100 DOLLARS ($150,000.00) per acre or portion thereof for the
portion of the Vistana Property to be conveyed to Purchaser at the Closing
not subject to the lien of the Mortgage (as defined in Section 1.02(c)
below), as legally described in Exhibit "F" attached hereto and containing
a minimum of ten (10) acres ("Initial Development Parcel"), after due
credit for costs, credits, prorations and adjustments as provided herein,
shall be paid by Purchaser to Seller at the time of Closing by wire
transfer of immediately available funds ("Cash Purchase Price").
(c) A purchase money note ("Note") in the form attached hereto as
Exhibit "G" for the balance of the Purchase Price shall be executed by
Purchaser and delivered to Seller at Closing as provided in Section V
below. The Note shall be secured by a purchase money mortgage ("Mortgage")
in the form attached hereto as Exhibit "H" to be executed by Purchaser and
delivered to Seller at Closing encumbering the remainder of the Vistana
Property not included in the Initial Development Parcel ("Mortgage
Property"). The Note and Mortgage shall require that Purchaser make
periodic payments of principal, without interest, in amounts sufficient to
release portions of the Mortgage Property in accordance with the following
schedule, based on an amount equal to ONE HUNDRED FIFTY THOUSAND AND NO/100
DOLLARS ($150,000.00) per acre or portion thereof of the Mortgage Property
to be released from the Mortgage:
(i) Purchaser shall pay such amount, which together with the
amount previously paid for the Initial Development Parcel shall
equal at least TWO MILLION TWO HUNDRED FIFTY THOUSAND AND NO/100
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DOLLARS ($2,250,000.00), in order to release so much of the Mortgage
Property which is contiguous to the Initial Development Parcel, and
which together with the Initial Development Parcel will contain at
least fifteen (15) acres, on or before the date which is twenty-one
(21) months after the date of Closing.
(ii) Purchaser shall pay such amount, which together with the
amount previously paid for the Initial Development Parcel and the
amount paid pursuant to Subsection 1.02(c)(i) above shall equal at
least THREE MILLION AND NO/100 DOLLARS ($3,000,000.00), in order to
release so much of the Mortgage Property which is contiguous to the
property previously released, and which together with the Initial
Development Parcel and the property released pursuant to Subsection
1.02(c)(i) above will contain at least twenty (20) acres, on or
before the date which is thirty-three (33) months after the date of
this Closing.
(iii)The entire remaining principal balance of the Mortgage shall
be paid by Purchaser in order to release the remainder of the
Mortgage Property from the Mortgage, on or before the date which is
forty-five (45) months after the Closing.
(iv) The Mortgage Property shall be released in such a manner so
that at any time the portion of the Mortgage Property not released
is a contiguous parcel without gaps, gores or hiatuses, and so that
the southernmost portion of the Vistana Property will be released
last.
(v) Purchaser shall also use its reasonable best efforts in the
design, planned phasing and construction of its Vacation Resort so
that at any time the improvements constructed on the portions of the
Vistana Property which have been released from the Mortgage will
comply with all setback and subdivision requirements applicable
thereto without regard to or reliance upon the remaining Mortgage
Property for such compliance. If any of the Vistana Property is
reconveyed to Seller for any reason hereunder, Seller and Purchaser
shall reasonably cooperate and grant to each other such easements as
are reasonably necessary to comply with such subdivision and setback
requirements and to provide for utilities and storm water drainage
and retention for each of their parcels. Seller acknowledges,
however, that it shall be responsible for providing its own access
to any portion of the Vistana Property conveyed back to it
hereunder.
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(vi) Purchaser's obligations under this Section 1.02(c) shall
survive the Closing of this Agreement.
SECTION II
REPRESENTATIONS AND WARRANTIES
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2.1 Seller's Representations and Warranties. Purchaser acknowledges
that it has inspected the Vistana Property, and at the Closing will accept the
Vistana Property in its then present condition. Purchaser further acknowledges
that except as expressly set forth herein, Seller shall have no obligation to
make any alterations, improvements or installations to or on the Vistana
Property, or to otherwise prepare the Vistana Property. EXCEPT AS EXPRESSLY SET
FORTH HEREIN, THE VISTANA PROPERTY IS BEING PURCHASED IN AN "AS IS", "WHERE IS"
CONDITION, "WITH ALL FAULTS", AND WITHOUT REPRESENTATIONS OR WARRANTIES OF ANY
KIND OR NATURE, EXPRESS OR IMPLIED, INCLUDING WITHOUT LIMITATION WARRANTIES OF
HABITABILITY, MERCHANTABILITY, OR FITNESS FOR A PARTICULAR USE OR PURPOSE OR
PURCHASER'S INTENDED USE. Notwithstanding the foregoing, Seller hereby
represents and warrants to Purchaser as follows:
(a) Authority. Seller has full power and authority to enter into
this Agreement and carry out the transactions contemplated hereby, and the
person executing this Agreement on behalf of Seller is duly authorized to
execute this Agreement and any other instruments or documents reasonably
necessary to carry out the transactions contemplated by this Agreement.
(b) Title. Subject to the closing of the transfer of the Option
Parcel to Seller as contemplated in the Callaway Agreement, Seller shall
have good right, title and authority to convey and transfer fee simple
title to the Vistana Property, or to cause fee simple title to the Vistana
Property to be conveyed, to Purchaser, together with all rights and
benefits which are the subject matter of this Agreement, free and clear of
all mortgages, liens, encumbrances, leases, tenancies, security interests,
covenants, conditions, restrictions, rights-of-way, easements, judgments
and other matters affecting title, excepting only the Permitted Exceptions
(as hereinafter defined) and taxes and assessments for the year of Closing
which are not yet due and payable. In the event this representation is not
correct, Purchaser's remedies shall be as set forth in Section 3.02.
(c) FIRPTA. Seller is not a "foreign person" as that term is
defined in Section 1445 of the United States Internal Revenue Code of 1986,
as amended.
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(d) No Violation. Seller's performance of this Agreement will not
result in any breach of or constitute a default, or result in the
imposition of any lien or encumbrance upon the Vistana Property, under any
agreement or other instrument to which Seller is a party or by which
Seller, or to the best of Seller's actual knowledge without any
investigation or inquiry on its part, the Vistana Property, might be bound.
(e) No Condemnation Pending or Threatened. To the best of Seller's
actual knowledge without any investigation or inquiry on its part, there is
no pending or threatened condemnation, property dedication requirement or
similar proceeding affecting the Vistana Property.
(f) Pending Litigation. To the best of Seller's actual knowledge
without any investigation or inquiry on its part, there are no legal
actions, suits or other legal or administrative proceedings pending or
threatened affecting the Vistana Property or any portion thereof.
(g) No Other Agreements. The Vistana Property will not be subject
to any agreements of sale, or any options, or other rights of third parties
to acquire any interest therein (except as set forth in this Agreement) of
which Seller has actual knowledge or to which Seller is a party.
(h) Compliance with Laws. Seller has received no notice from any
governmental authority claiming that the Vistana Property violates any
applicable building and zoning laws, rules, codes or regulations ("Zoning
Laws"). To the best of Seller's actual knowledge, without any
investigation or inquiry on its part, the conformity of the Vistana
Property (or the use of the Vistana Property for its intended purposes)
with the Zoning Laws is not based, in whole or in part, upon the Vistana
Property (or the contemplated uses thereof) being a so called "non-
conforming" use or similar exemption.
(i) Environmental. To the best of Seller's actual knowledge
without any investigation or inquiry on its part, there are no hazardous
substances present at, nor are there or have there been any hazardous
substance releases, dumping or spills at, on, under, about or upon the
Vistana Property in violation of any Environmental Law (as defined below).
Further, to the best of Seller's actual knowledge without any investigation
or inquiry on its part, there are no underground storage tanks present on
or under the Vistana Property. As used herein, the term "hazardous
substances" shall mean oil, hazardous material, hazardous waste, hazardous
substances or any other material which may be dangerous to health or the
environment, either separately or in
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combination with any other substance, when improperly generated, stored,
utilized, heated, disposed, released, transported or otherwise managed, as
the foregoing terms are defined by any federal, state or local statute,
ordinance, bylaw, code, rule or regulation now or hereafter enacted
applicable to environmental conditions on, under or about the Vistana
Property or applicable to any disposal, release, transportation or storage
of hazardous substances, including without limitation, the Comprehensive
Environmental Response Compensation and Liability Act, the Resource
Conservation and Recovery Act, the Federal Resource Conservation Recovery
Act, the Federal Water Pollution Control Act and the Federal Clean Air Act,
and state equivalents thereof and all regulations promulgated thereunder
(collectively, "Environmental Laws").
(j) Ownership of Golf Facilities. Seller or its affiliates
currently own and operate two 18-hole public golf courses at the Reserve
DRI known as "PGA Golf Club at the Reserve", and currently own and operate
an 18-hole semi-private golf course at St. Lucie West known as "St. Lucie
West Country Club".
(k) Financing. Seller has access to adequate financing to develop
the Learning Center (as hereinafter defined).
(l) Proposed Development. Seller intends to construct and operate
the Learning Center on the Option Parcel, provided Seller may convert the
Learning Center to an alternate use(s) in compliance with Section 6.10
below if the Learning Center proves to not be successful.
2.2 Purchaser's Representations and Warranties. Purchaser hereby
represents and warrants to Seller as follows:
(a) Authority. Purchaser has full power and authority to enter
into this Agreement and carry out the transactions contemplated hereby, and
the person executing this Agreement on behalf of Purchaser is duly
authorized to execute this Agreement and any other instruments or documents
reasonably necessary to carry out the transactions contemplated by this
Agreement.
(b) No Violation. Purchaser's performance of this Agreement will
not result in any breach of or constitute a default under any agreement or
other instrument to which Purchaser is a party or by which Purchaser might
be bound.
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(c) Financing. Purchaser has access to adequate financing
necessary for Purchaser to complete its contemplated development and
construction of the Vacation Resort on the Vistana Property.
(d) Proposed Development. Purchaser intends to construct and
operate a golf-oriented vacation ownership resort on the Vistana Property
containing a minimum of 250 units, provided Purchaser may convert the
Vistana Property to an alternate use(s) in compliance with Section 6.05
below if the vacation ownership resort proves to not be successful.
2.3 Survival of Representations and Warranties. The representations and
warranties set forth in this Section II shall be continuing and shall be true
and correct as of the Closing date and shall survive the Closing or earlier
termination of this Agreement.
SECTION III
TITLE COMMITMENT AND SURVEY; PERMITTED EXCEPTIONS
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3.1 Title Commitment. Seller has previously furnished a pro forma title
insurance commitment for the Vistana Property to Purchaser, together with copies
of all exception documents listed therein, based upon Seller's title insurance
commitment for the entire Option Parcel. At least twenty (20) days prior to
Closing, Seller shall, at its sole cost and expense, furnish Purchaser with, or
cause Callaway to furnish Purchaser with, a final title commitment for the
Vistana Property, Access and Utility Easement, Golf Access Easement and Callaway
Golf Access Easement, agreeing to issue to Purchaser, upon the recording of the
deed provided for herein, an ALTA fee policy of marketability title insurance in
the full amount of the Purchase Price, insuring Purchaser's title to the Vistana
Property, and Purchaser's interest in the Access and Utility Easement, Golf
Access Easement and Callaway Golf Access Easement, subject only to the Permitted
Exceptions (as hereinafter defined) ("Title Commitment"). The Title Commitment
shall include contiguity endorsements as necessary to confirm the contiguity of
(a) the Access and Utility Easement to the Vistana Property and a publicly
dedicated right-of-way; and (b) the Callaway Golf Access Easement to the Golf
Access Easement and a publicly dedicated right-of-way and/or the Access and
Utility Easement.
3.2 Title Examination.
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(a) Within ten (10) days after receipt of the Title Commitment,
Purchaser shall notify Seller in writing of any exceptions shown in the
Title Commitment which are unacceptable to Purchaser ("Title Objections").
Seller shall, at its option, have
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twenty (20) days after receipt of such notice ("Cure Period") within which
to cure or eliminate the Title Objections, or to attempt to cause Callaway
to cure or eliminate the Title Objections and to furnish to Purchaser
evidence that the same have been cured, or to obtain affirmative title
insurance from the title insurance company insuring against any Title
Objection, and the Closing shall be adjourned for a like period if Seller
elects to attempt to cure such Title Objections. Notwithstanding the
foregoing, in no event shall Seller be obligated to institute legal
proceedings or expend funds in excess of ONE THOUSAND AND NO/100 DOLLARS
($1,000.00) to cure any Title Objections, other than to discharge a lien
securing indebtedness of Seller and to release those certain easements in
favor of Seller's affiliate recorded in Official Record Book 923, at Pages
1660, 1670, 1682, 1696, 1708, 1720 and 1730, Public Records of St. Lucie
County, Florida (collectively, "PGA Easements"). In addition to the
foregoing, Seller has required as a covenant in the Callaway Agreement that
Callaway shall cause that certain Right Access Road Easement Agreement
recorded in Official Record Book 615, Page 1146, and the corresponding Road
Easement Agreement recorded in Official Record Book 627, Page 2124, as
amended in Official Record Book 923, Page 1598, and Official Record Book
923, Page 1604, all of the Public Records of St. Lucie County, Florida
(collectively, "Moose Easements"), to be released and terminated as
exceptions to title to the Vistana Property at Closing.
(b) Seller and Purchaser acknowledge and agree that the only
current means of access for the beneficiaries of the Moose Easements to
their properties is across an existing shell rock road, a portion of which
is on the Vistana Property ("Shell Road"). At Closing Seller shall enter
into an agreement with the beneficiaries of the Moose Easements to provide
them with a temporary license to continue to use the Shell Road until an
alternate road can be constructed by Seller or Callaway on some other
portion of the Option Parcel off of the Vistana Property, but in all events
said temporary license will terminate by no later than December 31, 1997.
Purchaser shall join in such an agreement for the purpose of consenting to
the temporary license over the Shell Road. Said agreement will require (i)
that Seller or Callaway construct such an alternative access road for the
beneficiaries of the Moose Easements off of the Vistana Property, and that
the same be completed to the same extent as the current Shell Road to
provide unimpeded access for the beneficiaries of the Moose Easement to
their properties, by no later than December 31, 1997; and (ii) upon
completion of such alternate road, Seller shall grant the beneficiaries of
the Moose Easements a license to use the alternate road and the
beneficiaries shall disclaim and abandon (in recordable form, if necessary)
any interest in or right to use the Shell Road, such disclaimer and
abandonment to be in form and substance satisfactory to
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cause the title insurance company issuing the Title Commitment to issue all
further title policies without exception for same, and otherwise
satisfactory to Purchaser in its reasonable discretion. All costs and
expenses of providing such an alternate road shall be the sole
responsibility of Seller or Callaway; provided, however, in the event the
alternate road is also over a portion of the access road from Reserve
Boulevard to both the Learning Center to be constructed by Seller and to
the Vistana Property, which shall be constructed pursuant to the Plat of
the Option Parcel to be recorded in accordance with in Section 6.02 below
(the "Entrance Road"), all costs of constructing said Entrance Road shall
be shared by Purchaser and Seller as specified in Section 6.02. The
agreement to be entered into by Seller and the beneficiaries of the Moose
Easements shall further provide, and Purchaser acknowledges, that said
beneficiaries will ultimately be granted permanent access to their
properties over the Entrance Road, and Seller has required as a covenant in
the Callaway Agreement that Callaway cause the Reserve Association, Inc.,
which is currently controlled by Callaway, to grant the beneficiaries of
the Moose Easements an easement over so much of the Entrance Road as is
dedicated to said association, for access, ingress and egress to their
parcels, said easement to be granted upon the dedication to the
association. The temporary license over the Shell Road to be granted to
the beneficiaries of the Moose Easement shall be deemed a "Permitted
Exception" for purposes of this Agreement until terminated and abandoned
pursuant to this Section. The easement rights over the Entrance Road to be
granted to the beneficiaries of the Moose Easements in accordance with the
requirements of this Section, shall also be deemed a "Permitted Exception"
to Purchaser's interest in the Access and Utility Easement for purposes of
this Agreement.
(c) If an alternate access road is not provided to the
beneficiaries of the Moose Easements as contemplated in subsection (b)
above, and as a result thereof the temporary license for the beneficiaries
of the Moose Easements is not terminated and abandoned (of record, if
necessary) prior to December 31, 1997, then Purchaser shall have the right
to deed the Vistana Property back to Seller by Special Warranty Deed, and
Seller shall reimburse to Purchaser, by wire transfer of immediately
available funds, the Cash Purchase Price and any other portion of the
Purchase Price previously paid by Purchaser, and cancel the Note and
discharge and release the Mortgage of record. Upon such a reconveyance the
parties shall each execute and deliver all documents reasonably requested
by the other or by any title insurance company insuring the reconveyance as
necessary to consummate the reconveyance and to cancel and terminate the
transactions contemplated by this Agreement. All documentary stamp taxes,
recording fees and other expenses of the reconveyance shall be paid by
Seller at the closing of the reconveyance, except that each party shall pay
its own
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attorneys' fees. The reconveyance of the Vistana Property shall occur
within thirty (30) days after Purchaser notifies Seller in writing of its
intention to reconvey the Vistana Property back to Seller.
(d) With respect to any Title Objection which Seller is unable or
elects not to cure, or which Seller is unable to cause Callaway to cure,
Purchaser shall within three (3) business days after the expiration of the
Cure Period, elect to either (1) notify Seller in writing that Purchaser
desires to accept the conveyance subject to the Title Objection, without
any diminution of the Purchase Price, in which event such matter shall be
deemed acceptable to Purchaser and a Permitted Exception under this
Agreement; or (2) terminate this Agreement by written notice to Seller. If
Purchaser does not terminate this Agreement within the three (3) business
day period, Purchaser shall be deemed to have accepted title subject to the
Title Objection pursuant to clause (1) above. All matters shown on the
final Title Commitment delivered to Purchaser at Closing to which Purchaser
does not object, or to which Purchaser objects but Purchaser nevertheless
closes on the purchase of the Vistana Property subject to such matters, are
collectively referred to as "Permitted Exceptions" in this Agreement.
3.3 Survey. Seller shall provide Purchaser with a copy of any survey of
the entire Option Parcel obtained by Seller, if any. Within the time provided
for Seller to deliver the Title Commitment to Purchaser in Section 3.02 above,
Purchaser may at its option, and at its sole cost and expense, obtain a boundary
survey of the Vistana Property prepared by a duly licensed land surveyor
("Survey"). If obtained, the Survey as to the Vistana Property shall: (i) show
the boundaries of the Initial Development Parcel, as well as the boundary of the
entire Vistana Property; (ii) contain the surveyor's certification that the
Survey meets all the technical standards of Florida Administrative Code Rule
61G17-6 (formerly known as 21HH-6), pursuant to Florida Statutes Section
472.027, and depicts all plottable easements shown on the Title Commitment; and
(iii) be certified to Seller, Purchaser, Purchaser's parent company, the title
insurance company, and any lender providing financing to Purchaser for the
acquisition or development of the Vistana Property. To the extent that the
Survey, or any recertification thereof, shows any encroachments upon the Vistana
Property, or on or between any building set-back line, property line or
easement, or any other matter which is not a Permitted Exception, except those
deemed acceptable to Purchaser in accordance with the terms hereof, said
encroachment shall be treated as a Title Objection under the procedure set forth
in Section 3.02 above.
3.4 Permitted Exceptions. The Vistana Property shall be conveyed to
Purchaser subject to no liens, charges, encumbrances, exceptions, easements,
agreements or reservations of any kind or character, other than the Permitted
Exceptions as defined herein.
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SECTION IV
PROPERTY INFORMATION AND CONTINGENCIES TO CLOSING
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4.1 Property Information. Along with the Title Commitment, Seller shall
furnish to Purchaser copies of all title evidence, contracts, agreements,
covenants, restrictions, easements, site and land use plans, inspection reports
and surveys which Seller has in its possession relating to the Option Parcel, if
any, and subject to the confidentiality obligations in Section 10.13 below, all
such information may be used by Purchaser in such manner as it desires.
4.2 Seller's Contingencies and Conditions to Closing. The obligations
of Seller under this Agreement to consummate the Closing are expressly subject
to and conditioned upon the satisfaction of each and every one of the following
conditions (any of which may be waived in whole or in part by Seller at or prior
to the Closing):
(a) The representations and warranties of Purchaser set forth in
this Agreement shall be true as of the Closing date.
(b) Title to the entire Option Parcel shall have been conveyed to
Seller, or at Seller's direction, Callaway shall convey the Vistana
Property directly to Purchaser simultaneously with the conveyance of the
remainder of the Option Parcel to Seller, as contemplated in the Callaway
Agreement.
(c) Purchaser shall have performed, observed and complied with all
of the covenants, agreements and conditions required by this Agreement to
be performed, observed and complied with by Purchaser as of the Closing
date and at the Closing.
4.3 Purchaser's Contingencies and Conditions to Closing. The obligations
of Purchaser under this Agreement to consummate the Closing are expressly
subject to and conditioned upon the satisfaction of each and every one of the
following conditions (any of which may be waived in whole or in part by
Purchaser at or prior to the Closing):
(a) The representations and warranties of Seller set forth in this
Agreement shall be true as of the Closing date.
(b) Seller shall have performed, observed and complied with all of
the covenants, agreements and conditions required by this Agreement to be
performed, observed and complied with by Seller as of the Closing date and
at the Closing.
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(c) At Closing, Seller shall cause Callaway, which controls the
property owners' association for the Reserve DRI, to release the Option
Parcel from the lien and effect of that certain Declaration of Covenants
and Restrictions for the Reserve recorded in Official Record Book 618, Page
978, as amended (the "Reserve Declaration"), and Seller has required the
same as a covenant in the Callaway Agreement. Notwithstanding the
foregoing, Purchaser acknowledges that all improvements to be constructed
on the Vistana Property shall remain subject to review and approval of the
New Construction Committee of the Reserve Association, Inc. In addition, in
conjunction with preparing the Proposed Site Plan for the Option Parcel to
be agreed upon by the parties as specified in Subsection 4.03(f) below,
Seller and Purchaser shall mutually cooperate and use their reasonable best
efforts to reach an agreement prior to Closing among themselves, Callaway
and the Reserve Association, Inc. allocating the responsibilities and costs
for the maintenance and upkeep of (a) the roads within or benefitting the
Reserve DRI (including, without limitation, landscaping maintenance at the
Interstate 95 interchange at Reserve Boulevard, and maintenance of Reserve
Boulevard and the Entrance Road to be constructed pursuant to the Plat);
(b) the lakes, surface water management systems and any wetlands mitigation
areas serving the Option Parcel and the Reserve DRI; and (c) the other
common areas and properties within the Reserve DRI, and also containing
such other covenants, restrictions and provisions (including, without
limitation, procedures for design review and approval by the New
Construction Committee of the Reserve Association, Inc. of the improvements
proposed to be constructed by Purchaser (which shall include a provision
that approval shall be deemed granted within ten (10) days if the proposed
improvements are not objected to or disapproved in writing by the New
Construction Committee within the ten (10) day period), and provisions for
self-help and reimbursement remedies should any party fail to fulfill its
obligations under such agreement) as mutually agreed upon by the parties
respecting the use and ownership of properties within the Option Parcel
("Maintenance Agreement"). Seller shall require in its contract with other
prospective purchasers of any portion of the Option Parcel, if any, that
such purchaser join in and agree to be bound by the Maintenance Agreement.
If the appropriate parties are unable to agree on a mutually acceptable
Maintenance Agreement prior to the Closing, then either Seller or Purchaser
may elect to terminate this Agreement by written notice to the other prior
to Closing, in which event all rights and liabilities of the parties
hereunder shall end, except for any matters which specifically survive
termination of this Agreement.
(d) Purchaser shall have obtained reasonable assurances that it
will be able to reserve sufficient residential vehicle trips with St. Lucie
County, Florida at the
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Closing as necessary for Purchaser's intended development and use of the
Vistana Property for up to four hundred (400) residential units.
Notwithstanding the foregoing, Purchaser hereby agrees that it shall pay
any and all costs directly associated with any traffic monitoring
requirements applicable to the Reserve DRI which are triggered by
Purchaser's reservation of such residential trips, if any, until such time
as an equal number of trips have been utilized by the future development of
property within the Reserve DRI, whether or not owned by Seller or
Purchaser. Seller has required as a covenant in the Callaway Agreement that
Callaway timely perform and comply with any off-site improvement
requirements applicable to the Reserve DRI which are triggered by
Purchaser's reservation of such residential trips, and that Seller have the
right to take over and complete any such off-site improvements should
Callaway fail to do so in a timely manner and as a result of such failure
Seller and any other owner of any portion of the Option Parcel is denied
necessary permits or approvals to proceed with its intended development.
Purchaser shall be a third-party beneficiary of such right and shall have
the right, but not the obligation, to take over and complete such off-site
improvements itself should Seller fail to enforce its rights under the
Callaway Agreement with respect thereto, in which event any impact fee
credits generated by Purchaser's construction of any such off-site
improvements shall inure to the benefit of Purchaser. Purchaser and Seller
acknowledge that Purchaser's reservation of residential vehicle trips
pursuant to this Section may require a reallocation of the total trips
permitted for the Reserve DRI to increase the number of permitted
residential trips, and that the same may require the consent and
acknowledgment of Callaway as the developer of the Reserve DRI. Seller has
required as a covenant in the Callaway Agreement that Callaway deliver to
St. Lucie County, Florida and Purchaser at Closing a letter acknowledging
and consenting to Purchaser's reservation of such residential trips and the
required reallocation of trips permitted for the Reserve DRI from non-
residential to residential trips, if any, and that Callaway shall also
deliver to Purchaser any necessary assignment of such residential trips.
The provisions of this Section 4.03(d) shall survive the Closing of this
Agreement.
(e) Purchaser shall obtain reasonable assurances that it will be
able to obtain a reservation of sufficient permitted residential units
within the Reserve DRI or Reserve P.U.D. as necessary for Purchaser's
Vacation Resort, up to a maximum of four hundred (400) residential units.
Purchaser and Seller acknowledge that Purchaser's reservation of
residential units pursuant to this Section may require a reallocation of
permitted residential units from other development parcels within the
Reserve DRI or Reserve P.U.D. to the Vistana Property, and that the same
may require the consent and acknowledgment of Callaway as the developer of
the Reserve
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DRI and Reserve P.U.D. Seller has required as a covenant in the Callaway
Agreement that Callaway deliver to St. Lucie County, Florida and Purchaser
at Closing a letter acknowledging and consenting to Purchaser's reservation
of such residential units and the required reallocation of permitted
residential units from other development parcels within the Reserve DRI or
Reserve P.U.D., if any, and that Callaway shall also deliver to Purchaser
any necessary assignment of the right to construct up to the maximum number
of units specified above on the Vistana Property.
(f) Seller and Purchaser shall use their reasonable best efforts to
mutually agree on a final proposed site plan for the Option Parcel in
sufficient detail so as to allow Seller and Purchaser to promptly proceed
after the Closing to apply for and obtain governmental Preliminary P.U.D.
Amendment (as defined below) and plat approvals as necessary for the
intended use and development of the Option Parcel and the Vistana Property
("Proposed Site Plan"), and Seller and Purchaser shall have received any
necessary, if any, approval for the Proposed Site Plan from the New
Construction Committee of the Reserve Association, Inc. prior to Closing.
Seller and Purchaser have agreed on a preliminary site plan for the Option
Parcel which is attached hereto as Exhibit "I" and made a part hereof. The
Proposed Site Plan shall be generally consistent with the preliminary site
plan.
(g) Seller shall have released the PGA Easements, and the Moose
Easements shall have been released and replaced with a temporary license
and agreement, all as specified in Section 3.02 above.
4.4 Failure of Conditions. In the event that any of the contingencies
or conditions to either party's obligations to consummate the Closing as set
forth in Sections 4.02 and 4.03 are not satisfied on or before the Closing date
as contemplated herein, unless the same is waived, then the party benefitted by
such contingency or condition may elect to terminate this Agreement by written
notice to the other party, in which event all rights and liabilities of the
parties hereunder shall end, except for any matters which specifically survive
the termination of this Agreement. If neither party shall have notified the
other of its election to terminate this Agreement pursuant to any right to do so
under Sections 4.02 or 4.03, then such contingencies and conditions shall be
deemed satisfied and the parties shall proceed to the Closing.
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SECTION V
PROVISIONS WITH RESPECT TO CLOSING
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5.1 Closing Date. The consummation of the transaction contemplated by
this Agreement ("Closing") shall take place on or before September 12, 1997, or
at such other earlier date as Seller and Purchaser may mutually select, unless
extended by other provisions of this Agreement, at the location hereinafter set
forth.
5.2 Seller's Obligations at Closing. Subject to the terms of this
Agreement and contemporaneously with the performance by Purchaser of its
obligations under this Agreement, at Closing Seller shall:
(a) Execute, acknowledge and deliver to Purchaser, or cause
Callaway to execute, acknowledge and deliver to Purchaser, a Special
Warranty Deed conveying the Vistana Property to Purchaser subject only to
the Permitted Exceptions and taxes and assessments for the year of Closing.
The deed shall be in recordable form with all required documentary stamps
in the proper amount affixed by Seller or Callaway at its expense, as
applicable. The legal description of the Vistana Property contained in such
deed shall be identical to the legal description contained in the Survey of
the Vistana Property, if obtained by Purchaser, and in the final Title
Commitment, provided in the event there is any conflict between the legal
description contained in the deed and final Title Commitment, and that
contained in the Survey, then either the surveyor shall certify to the
parties at Closing that the conflicting descriptions actually describe the
same land, or the conflict shall be treated as a Title Objection pursuant
to Section 3.02 above.
(b) Deliver to Purchaser and the title insurance company evidence
satisfactory to them of Seller's or Callaway's, as applicable, authority to
execute and deliver the documents reasonably necessary to consummate this
transaction.
(c) Cause the title insurance company to deliver to Purchaser a
marked-up version of the Title Commitment current as of the date of
Closing, indicating the final exceptions to be included in the owner's
policy of title insurance to be delivered to Purchaser after Closing and
showing the premium paid for said policy, and indicating payment of the
Cash Purchase Price and satisfaction of all other requirements necessary to
issuance of the owner's policy of title insurance subject to no exceptions
other than the Permitted Exceptions.
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(d) Execute and deliver, or cause Callaway to execute and deliver,
to Purchaser and the title insurance company an Affidavit of Possession and
No Liens sufficient to allow the title insurance company to issue the
marked-up Title Commitment referred to in the preceding paragraph.
(e) Deliver to Purchaser a certificate that Seller or Callaway, as
applicable, is not a foreign person in accordance with Section 1445 of the
Internal Revenue Code.
(f) Execute, acknowledge and deliver to Purchaser the non-exclusive
Access and Utility Easement, and cause its affiliate to execute,
acknowledge and deliver to Purchaser the non-exclusive Golf Access
Easement, as specified in Section 1.01 above, both in recordable form with
all required documentary stamps in the proper amount affixed by Seller at
its expense.
(g) Cause PGA GOLF PROPERTIES, INC., an affiliate of Seller ("Golf
Properties"), to execute and deliver a marketing, promotion and licensing
agreement to Purchaser relating to the marketing of Purchaser's Vacation
Resort and the use of the "PGA" name and the network of PGA Members, PGA
Apprentices and employees of the PGA Sections in connection therewith, in
substantially the form attached hereto as Exhibit "J" and made a part
hereof ("Marketing and Promotion Agreement").
(h) Cause Golf Properties to execute and deliver a multi-site
affiliation agreement with VISTANA, INC., a Florida corporation and
Purchaser's parent company, for the development of additional vacation
ownership resorts at or adjacent to other golf course facilities owned,
licensed, operated or approved by Seller or its affiliates, in
substantially the form attached hereto as Exhibit "K" and made a part
hereof ("Affiliation Agreement").
(i) Execute and deliver, or cause its appropriate affiliates to
execute and deliver, a mutually acceptable agreement to provide owners and
renters of Purchaser's Vacation Resort a mutually acceptable level of
preferred access to the PGA Golf Club at The Reserve, St. Lucie West
Country Club, and other golf courses owned, operated or managed by Seller
or its affiliates in St. Lucie County, Florida now or in the future, and
specifying such other benefits and privileges, if any, as may be available
to owners and guests of Purchaser's Vacation Resort ("Golf Course Access
Agreement"). In addition to such other terms as are mutually agreed to by
Seller and Purchaser, the Golf Course Access Agreement shall provide that
(i) the operators of such golf courses shall reserve for the benefit of the
owners, renters and guests of Purchaser's Vacation Resort tee times at such
golf courses for one (1) round of golf
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per day per completed unit (as evidenced by issuance of a certificate of
occupancy for such unit by the appropriate governmental authority) in
Purchaser's Vacation Resort, up to a maximum of four hundred (400) units;
(ii) such owners, renters and guests shall have the right to make
reservations for such reserved tee times in advance; and (iii) Seller and
Purchaser shall record at Closing a mutually acceptable Memorandum of Golf
Course Access Agreement against such golf courses and benefitting the
Vistana Property. Seller represents that it presently intends to exercise
an option it has from Callaway to have Callaway convey additional property
within the Reserve DRI on which Seller would construct a third 18-hole golf
course, pursuant to a separate Golf Land Acquisition Agreement to be
executed by Seller and Callaway. Subject to execution of such a Golf Land
Acquisition Agreement mutually acceptable to Seller and Callaway and the
satisfaction of all contingencies specified therein to PGA's sole
satisfaction, PGA will acquire the land for the third golf course from
Callaway, and upon Seller's completion of the third golf course the course
will be included in and subject to the Golf Course Access Agreement.
(j) Execute and deliver, and cause Callaway and the Reserve
Association, Inc. to execute and deliver, the Maintenance Agreement as
provided in Section 4.03(c) above.
(k) Execute and deliver such other documents and instruments as
reasonably required by Purchaser or the title insurance company.
(l) Cause Callaway to (1) execute, acknowledge and deliver to
Purchaser, or (2) cause the Reserve Association, Inc. or the Reserve
Community Development District, both of which are controlled by Callaway,
to execute, acknowledge and deliver to Purchaser, as appropriate, the
following documents, instruments, covenants and agreements:
(i) An agreement by Callaway or the Reserve Community
Development District to commence construction, within one (1) year
after the Closing, of a wetlands mitigation area on other property
owned by Callaway within the Reserve DRI in accordance with the Army
Corps of Engineers permit issued therefor, to allow a portion of the
Vistana Property which is currently designated as wetlands to be
filled in, and to complete such construction within two (2) years
after the Closing ("Wetlands Mitigation Agreement"). Seller has
required as a condition in the Callaway Agreement that Seller have
the right to take over and complete the wetlands mitigation should
Callaway fail to do so in a timely manner and as a result of such
failure
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Seller or any other owner of any portion of the Option Parcel is
denied necessary permits or approvals to proceed with its intended
development. Purchaser shall be a third-party beneficiary of such
right, and shall have the right, but not the obligation, to take
over and complete the wetlands mitigation itself should Seller fail
to enforce its rights under the Callaway Agreement with respect
thereto, in which event Purchaser shall have the right to offset
such costs and expenses, up to a maximum of TWENTY FIVE THOUSAND
DOLLARS ($25,000.00), against the next amounts due to Seller under
the Note. The Wetlands Mitigation Agreement shall contain an
acknowledgment of Seller's and Purchaser's rights in this regard and
shall contain an obligation to cooperate with Seller and Purchaser
in their completion of the wetlands mitigation in the event they
exercise their remedies hereunder. The provisions of this Section
shall survive the Closing of this Agreement.
(ii) An agreement by Callaway to accept and allow the
relocation of any gopher tortoises which may be on the Vistana
Property to a preserve area owned by Callaway within the Reserve
DRI. Purchaser acknowledges that it has the sole responsibility to
obtain all governmental approvals required for such relocation and
to complete the relocation, at its sole cost and expense. The
provisions of this Section shall survive the Closing of this
Agreement.
(iii) An agreement by Callaway to install street lights,
irrigation and landscaping to a standard generally consistent with
that maintained throughout the remainder of the residential portions
of the Reserve DRI, along the Entrance Road constructed pursuant to
the Plat to be completed and recorded by Seller and Purchaser in
accordance with Section 6.02 below, as and when the installation of
such street lights, irrigation and landscaping is required in
connection with the construction of the Entrance Road, but not later
than the date on which a certificate of occupancy is issued for the
first phase of construction on the Vistana Property or November 1,
1998, whichever is earlier ("Off-Site Improvement Agreement").
Seller has required as a condition in the Callaway Agreement that
Seller shall have the right to take over and complete the
installation of such street lights, irrigation and landscaping
should Callaway fail to do so in a timely manner and as a result of
such failure Seller or any other owner of any portion of the Option
Parcel is denied necessary permits or approvals to proceed with its
intended development. Purchaser shall be a third-party beneficiary
of such right, and shall have the right, but not the obligation, to
take over and complete the installation of such street lights,
irrigation and landscaping itself should Seller
19
fail to enforce its rights under the Callaway Agreement with respect
thereto, in which event, Purchaser may offset such costs and
expenses, up to a maximum of ONE HUNDRED NINETY FIVE THOUSAND
DOLLARS ($195,000.00), against the next amounts due to Seller under
the Note. The Off-Site Improvement Agreement shall contain an
acknowledgment of Seller's and Purchaser's rights in this regard and
shall contain an obligation to cooperate with Seller and Purchaser
in their completion of such off-site improvements in the event they
exercise their remedies hereunder. The provisions of this Section
shall survive the Closing of this Agreement.
(iv) An agreement and covenant by Callaway to comply in
all material respects with the requirements of the Reserve DRI and
the Reserve P.U.D. ("P.U.D. Agreement"). Seller has required as a
condition in the Callaway Agreement that Seller have the right to
take over and complete any requirements of the Reserve DRI or
Reserve P.U.D. which Callaway does not comply with in a timely
manner and as a result of such failure Seller or any other owner of
any portion of the Option Parcel is denied necessary permits or
approvals to proceed with its intended development. Purchaser shall
be a third-party beneficiary of such right, and shall have the
right, but not the obligation, to take over and complete any such
requirements of the Reserve DRI or Reserve P.U.D. itself should
Seller fail to enforce its rights under the Callaway Agreement with
respect thereto, in which event Purchaser shall have the right to
seek reimbursement from Callaway of all costs and expenses incurred
by Purchaser in connection therewith. The P.U.D. Agreement shall
contain an acknowledgment of Seller's and Purchaser's rights in this
regard and shall contain an obligation to cooperate with Seller and
Purchaser in their performance of any such Reserve DRI or Reserve
P.U.D. obligations in the event they exercise their remedies
hereunder. The provisions of this Section shall survive the Closing
of this Agreement.
(v) An amendment to the Reserve Declaration releasing the
Option Parcel from the lien and effect thereof, as provided in and
subject to the requirements of Section 4.03(c) above.
(vi) An acknowledgment and consent by Callaway to the
reallocation of vehicle trips permitted for the Reserve DRI and any
necessary assignment by Callaway to Purchaser of sufficient
residential trips for up to four hundred (400) residential units to
be reserved by Purchaser for its Vacation Resort, as provided in
Section 4.03(d) above.
20
(vii) An acknowledgment and consent by Callaway to the
reallocation of permitted residential units to the Vistana Property
from other development parcels within the Reserve DRI or Reserve
P.U.D., and any necessary assignment by Callaway to Purchaser of up
to four hundred (400) permitted residential units to be reserved by
Purchaser for its Vacation Resort, as provided in Section 4.03(e)
above.
(viii) A release and termination by Callaway of the Moose
Easements, joined in by the beneficiaries thereof as necessary, and
a new temporary license and agreement between Seller, Callaway and
the beneficiaries of the Moose Easements, all as specified in
Section 3.02 above. Callaway shall also agree to join in a release
of the PGA Easements as necessary to have such easements released as
an exception to title to the Vistana Property. In the event the
requirements of this subsection are not fully satisfied prior to
Closing, Purchaser shall have the right to terminate this Agreement
by written notice to Seller at any time prior to Closing, in which
event all rights and liabilities of the parties hereunder shall end,
except for any matters which specifically survive the termination of
this Agreement.
(ix) A non-exclusive Callaway Golf Access Easement over
the private portion of Reserve Boulevard to Perfect Drive as
specified in Section 1.01 above, as necessary for access, egress and
ingress to PGA Golf Club at the Reserve for Purchaser, owners of
interests in Purchaser's Vacation Resort, any timeshare or other
property owners' association created for the management and
maintenance of Purchaser's Vacation Resort, and tenants of
Purchaser's Vacation Resort, and their respective guests, employees,
agents, contractors, invitees, heirs, personal representatives,
successors and assigns, in recordable form with all required
documentary stamps in the proper amount affixed by Callaway or the
Reserve Association, Inc., as applicable, at its expense.
(x) An acknowledgment and agreement by Callaway
designating Purchaser as the exclusive developer of vacation
ownership property within the Reserve DRI.
(xi) An agreement and covenant by the Reserve Community
Development District to complete, within six (6) months after the
Closing, the construction of an emergency generator and pump system
for the existing water plant serving the Reserve DRI, which will
expand the rated capacity of
21
the water plant to approximately 400,000 gallons per day ("Water
Agreement"). Seller has required as a condition in the Callaway
Agreement that Seller have the right to take over and complete the
water plant expansion should the district fail to do so in a timely
manner and as a result of such failure Seller or any other owner of
any portion of the Option Parcel is denied necessary permits or
approvals to proceed with its intended development. Purchaser shall
be a third-party beneficiary of such right, and shall have the
right, but not the obligation, to take over and complete the
expansion itself should Seller fail to enforce its rights under the
Callaway Agreement with respect thereto, in which event Purchaser
may offset such costs and expenses, up to a maximum of TWENTY FIVE
THOUSAND DOLLARS ($25,000.00), against the next amounts due to
Seller under the Note. The Water Agreement shall contain an
acknowledgment of Seller's and Purchaser's rights in this regard and
shall contain an obligation to cooperate with Seller and Purchaser
in the completion of the water plant expansion in the event they
exercise their remedies hereunder. The provisions of this Section
shall survive the Closing of this Agreement.
(xii) An agreement and covenant by the Reserve Community
Development District to apply for and use its best efforts to obtain
all permits and approvals necessary to construct a surge tank to
expand the capacity of the existing sewer plant serving the Reserve
DRI, which will expand the rated capacity of the sewer plant to
approximately 175,000 gallons per day, or to construct a sewer
inter-connect to the sewer plant operated by the St. Lucie West
Services District as contemplated by the Utility Inter-Connect
Agreement between the Reserve Community Development District and the
St. Lucie West Services District, and to complete construction of
the surge tank or the utility inter-connect within nine (9) months
after the Closing ("Sewer Agreement"). Seller has required as a
condition in the Callaway Agreement that Seller have the right to
take over and complete construction of the surge tank or the utility
inter-connect, as applicable, should the district fail to do so in a
timely manner and as a result of such failure Seller or any other
owner of any portion of the Option Parcel is denied necessary
permits or approvals to proceed with its intended development.
Purchaser shall be a third-party beneficiary of such right, and
shall have the right, but not the obligation, to take over and
complete the surge tank or utility inter-connect construction itself
should Seller fail to enforce its rights under the Callaway
Agreement with respect thereto, in which event Purchaser shall have
the right to seek reimbursement from Callaway of all costs and
expenses incurred by Purchaser in connection
22
therewith. Alternatively, Purchaser may offset such costs and
expenses, up to a maximum of ONE HUNDRED FIFTY FIVE THOUSAND DOLLARS
($155,000.00), against the next amounts due to Seller under the
Note. The Sewer Agreement shall contain an acknowledgment of
Seller's and Purchaser's rights in this regard and shall contain an
obligation to cooperate with Seller and Purchaser in their
completion of the sewer expansion in the event they exercise their
remedies hereunder. The provisions of this Section shall survive the
Closing of this Agreement.
(xiii) A certificate from the engineers for the Reserve
Community Development District certifying that all of the Option
Parcel is included within the existing boundaries of the property
covered by said district.
(xiv) An estoppel certificate from the Reserve Community
Development District stating that there are no accrued but unpaid
assessments due to said district with respect to the Vistana
Property, and to the best of its knowledge, there are no violations
or defaults under the governing documents of said district with
respect to the Vistana Property, and setting forth the assessments
due and payable to said district with respect to the Vistana
Property for the year of Closing, together with current financial
statements of the Reserve Community Development District and the
district's financial projections of water and sewer revenues for the
years 1997 through 2002.
(xv) Current financial statements of the Reserve
Association, Inc., the current budget for the Reserve Association,
Inc. for the year of Closing, and proposed budgets of the Reserve
Association, Inc. for years subsequent to the Closing, if any have
been prepared at that time.
(xvi) Seller has required as a condition in the Callaway
Agreement that Callaway deliver quarterly and annual reports after
the Closing to Seller and Purchaser detailing the status of and
Callaway's progress in obtaining necessary permits for and
completing its obligations under the Reserve DRI and Reserve P.U.D.,
and under Subsections 5.02(l)(i), (iii), (xi) and (xii) above. The
quarterly and annual reports shall also detail the number of
residential vehicle trips vested by development within the Reserve
DRI since the Closing, for purposes of monitoring such residential
trips in accordance with Section 4.03(d) above. Purchaser shall be a
third-party beneficiary of Seller's rights in this regard, and shall
have the right, but not the obligation, to seek to enforce the
obligation to deliver such reports against Callaway should
23
Seller fail to enforce its rights under the Callaway Agreement with
respect thereto. The provisions of this Section shall survive the
Closing of this Agreement.
5.3 Purchaser's Obligations at Closing. Subject to the terms of this
Agreement and contemporaneously with the performance by Seller of its
obligations under this Agreement, at Closing Purchaser shall:
(a) Deliver to Seller, by wire transfer of immediately available
funds, the Cash Purchase Price after due credit for closing costs, credits,
prorations and adjustments provided for herein.
(b) Execute and deliver the Note to Seller.
(c) Execute, acknowledge and deliver the Mortgage to Seller.
(d) Deliver to Seller and the title insurance company evidence
satisfactory to it of Purchaser's authority to execute and deliver the
documents reasonably necessary to consummate this transaction.
(e) Execute and deliver to Golf Properties the Marketing and
Promotion Agreement contemplated by Section 5.02(g) above.
(f) Cause VISTANA, INC. to execute and deliver to Golf
Properties the Affiliation Agreement contemplated by Section 5.02(h) above.
(g) Execute and deliver to Seller or its appropriate affiliates
the Golf Course Access Agreement contemplated by Section 5.02(i) above.
(h) Execute and deliver to Seller, Callaway and the Reserve
Association, Inc. the Maintenance Agreement contemplated in Section 4.03(c)
above.
(i) Join in and consent to the temporary license for the
beneficiaries of the Moose Easements to use the Shell Road until no later
than December 31, 1997, as contemplated in Section 3.02 above.
(j) Pay to the Reserve Community Development District such
amounts as necessary for such water and sewer connections as Purchaser
elects to reserve at Closing, if any, and execute and deliver to the
Reserve Community Development
24
District a Standard Developer's Agreement for any such reserved water and
sewer connections if required by the district.
(k) Receipts and releases of commissions from the Brokers as
contemplated in Section 8.01 below, in form mutually acceptable to Seller
and Purchaser.
(l) Execute and deliver such other documents and instruments as
reasonably required by Seller or the title insurance company.
5.4 Closing Costs.
(a) Seller shall pay or cause to be paid the following costs and
expenses in connection with Closing:
(i) All documentary stamps which are required to be
affixed to the Special Warranty Deed, Access and Utility Easement,
Golf Access Easement and Callaway Golf Access Easement;
(ii) The cost of recording any corrective instruments
required to be recorded in connection with the Closing, including
instruments releasing the PGA Easements and the Moose Easements;
(iii) Seller's attorneys' fees;
(iv) The premium payable for the Title Commitment and
owner's title insurance policy; and
(v) Satisfaction of any mortgages or liens affecting the
Vistana Property required to be satisfied by Seller prior to or at
Closing, other than the Permitted Exceptions.
(b) Purchaser shall pay the following costs and expenses in
connection with Closing:
(i) The cost of recording the Special Warranty Deed, the
Access and Utility Easement, the Golf Access Easement, the Callaway
Golf Access Easement, the Mortgage and any other documents required
to be recorded (other than corrective instruments under Subsection
5.04(a)(ii) above);
25
(ii) The cost of any documentary stamp taxes, intangible
taxes or any other taxes or recording charges in connection with the
Note and Mortgage;
(iii) Purchaser's attorneys' fees;
(iv) The costs for the Survey of the Vistana Property
obtained by Purchaser pursuant to Section 3.03 above, if any; and
(v) All costs and expenses associated with any additional
acquisition or development financing obtained by Purchaser in
connection with this transaction.
5.5 Proration of Taxes. Any property or ad valorem taxes and assessments
for the year of Closing shall be prorated between Purchaser and Seller or
Callaway, as applicable, to the date of Closing using the latest available
information from the taxing or assessing authority. If the foregoing prorations
are estimated based upon the prior year's taxes or assessments, then Seller and
Purchaser shall recalculate the applicable proration upon notice once the actual
amounts of the taxes or assessments for the year of Closing are available. Any
amount due from one party to the other by reason of such recalculation shall be
paid in cash at the time. Any further reproration required with Callaway shall
be handled by Seller pursuant to the Callaway Agreement. The provisions of this
Section shall survive the Closing of this Agreement.
5.6 Special Assessments. If as of the date of Closing, the Vistana
Property or any part thereof is affected by assessments which are, or which may
become, payable in installments, of which the first installment is then a charge
or lien, or has been paid, then for the purposes of this Agreement, any unpaid
installments of any such assessments due and payable during the year of Closing
shall be prorated between Purchaser and Seller or Callaway, as applicable, to
the date of Closing using the latest information available from the assessing
authority, and Purchaser or its successors in title to any portion of the
Vistana Property shall be responsible for the payment of all future installments
of any such assessments applicable to the relevant portions of the Vistana
Property, including without limitation any assessments by the Reserve Community
Development District. If the foregoing proration is estimated based upon the
prior year's assessment, then Seller and Purchaser shall recalculate the
proration upon notice once the actual amount of the assessment for the year of
such Closing is available. Any amount due from one party to the other by reason
of such recalculation shall be paid in cash at the time. Any further reproration
required with Callaway shall be handled by Seller pursuant to the Callaway
26
Agreement. All assessments against any portion of the Vistana Property
for periods after the date of Closing shall be assumed and paid and discharged
by Purchaser as and when due. PURCHASER IS HEREBY NOTIFIED THAT THE RESERVE
COMMUNITY DEVELOPMENT DISTRICT IMPOSES TAXES OR ASSESSMENTS, OR BOTH TAXES AND
ASSESSMENTS, ON THE VISTANA PROPERTY THROUGH A SPECIAL TAXING DISTRICT. THESE
TAXES AND ASSESSMENTS PAY THE CONSTRUCTION, OPERATION AND MAINTENANCE COSTS OF
CERTAIN PUBLIC FACILITIES OF THE DISTRICT AND ARE SET ANNUALLY BY THE GOVERNING
BOARD OF THE DISTRICT. THESE TAXES AND ASSESSMENTS ARE IN ADDITION TO COUNTY
AND ALL OTHER TAXES AND ASSESSMENTS PROVIDED FOR BY LAW. The provisions of this
Section shall survive the Closing of this Agreement.
5.7 Possession. Exclusive possession of the Vistana Property shall be
delivered to Purchaser at Closing.
5.8 Location. Closing shall be held at the offices of Seller's attorneys,
Gunster, Yoakley, Xxxxxx-Xxxxx & Xxxxxxx, P.A., 000 Xxxxx Xxxxxxx Xxxxx, Xxxxx
000 Xxxx, Xxxx Xxxx Xxxxx, Xxxxxxx 00000, or at such other location as shall be
agreed upon by the parties.
SECTION IV
POST-CLOSING COVENANTS AND OBLIGATIONS;
DEVELOPMENT OF PROPERTY
6.1 Design Themes and Consistency. After the Closing, Seller and
Purchaser will cooperate and work with each other and with any other owners and
prospective purchasers of any portion of the Option Parcel to develop mutually
acceptable, common and harmonious architectural standards and themes for the
facilities to be developed on the Option Parcel. Seller shall also use
reasonable efforts to consult with Purchaser with respect to matters coming
before the New Construction Committee of the Reserve Association, Inc., on which
an employee of Seller or its affiliates is a member.
6.2 Preliminary P.U.D. Amendment and Platting. After the Closing, Seller
and Purchaser shall cooperate with each other and use their best efforts to
obtain all required governmental approvals for a preliminary amendment to the
Reserve P.U.D. ("Preliminary P.U.D. Amendment"), and to prepare and obtain all
required governmental approvals for a subdivision plat ("Plat") of the Option
Parcel providing for such utility, drainage, maintenance and landscaping
easements as necessary for the intended development and use of the Option
Parcel, based the Proposed Site Plan of the Option Parcel to be mutually agreed
27
upon pursuant to Section 4.03(f) above, on an expedited basis. Seller and
Purchaser shall equally share the costs of obtaining the Preliminary P.U.D.
Amendment and preparing, obtaining approval for and recording the Plat, provided
Seller and Purchaser shall each pay their allocated share of the engineering
costs of the Entrance Road as specified in Section 6.03(a) below, and Purchaser
shall pay all site engineering costs for the Vistana Property. Purchaser shall
have primary responsibility for processing and obtaining approvals for the
Preliminary P.U.D. Amendment and the Plat, provided Seller shall promptly
cooperate with Purchaser in this regard and cause its representatives to appear
in any governmental proceedings, and to join in, consent to and execute such
applications, acknowledgments and agreements, as and when reasonably required in
connection therewith. Seller acknowledges that Purchaser intends to use the same
consultants used by Seller in connection with the Preliminary P.U.D. Amendment
and Plat, and Seller hereby consents to the same, provided such use shall be at
the Purchaser's sole cost and expense. Seller and Purchaser each acknowledge
that the timing of the approvals of the Preliminary P.U.D. Amendment and the
Plat is critical for the timely development of the Vistana Property and the
Option Parcel, and therefore each shall promptly cooperate with and work with
each other to obtain such approvals as expeditiously as possible. Purchaser
acknowledges that it shall be solely responsible for obtaining all required
final site plan and planned unit development approvals and all other permits and
approvals necessary for its intended development and use of the Vistana
Property, and for paying all costs and expenses in connection therewith.
6.3 Infrastructure. After the Closing, Seller and Purchaser shall
jointly contract for and cause the following infrastructure improvements to be
constructed for the benefit of the Option Parcel and Vistana Property, and shall
share the costs for such infrastructure improvements as set forth below:
(a) Entrance Road. The Entrance Road (as defined in Section 3.02
above) to the Option Parcel from Reserve Boulevard as depicted on the
Proposed Site Plan. All engineering and construction costs for the portion
of the Entrance Road from its intersection with Reserve Boulevard to the
South until it splits shall be equally shared by Seller and Purchaser. All
such costs for the portion of the Entrance Road from such split South to
the entrance to the Vistana Property shall be paid solely by Purchaser. All
such costs for the portion of the Entrance Road from the split East to the
Learning Center to be developed by Seller shall be paid solely by Seller.
Seller and Purchaser shall also proportionately share the cost of any bond
for the completion of the Entrance Road required in connection with the
Plat, based on the relative portions of the total engineering and
construction costs of the Entrance Road paid by each. Any impact fee
credits which may be generated for the benefit of the Option Parcel arising
from the construction of the Entrance Road or any other infrastructure
28
improvements by Seller and Purchaser, shall be allocated to Seller and
Purchaser pro rata on the basis of the relative shares of the costs for
such infrastructure improvements paid by each of them.
(b) Lift Station. Seller and Purchaser shall equally share the
engineering and construction costs for a sewer lift station(s) to serve
both the Vistana Property and the remainder of the Option Parcel in the
location(s) to be designated on the Proposed Site Plan.
(c) Surface Water Management System. Seller shall design a surface
water management system ("Surface Water Management System") for the Option
Parcel in conjunction with the overall surface water management system for
the Reserve DRI and Reserve P.U.D. The design of the Surface Water
Management System shall be consistent with Purchaser's development plan for
the Vistana Property, as shall be shown on the Proposed Site Plan, and be
of sufficient capacity to accommodate the storm water retention and
drainage requirements of the Vistana Property and the entire Option Parcel.
Except as set forth in subsection (d) below, Seller shall pay all costs for
the design and construction of the Surface Water Management System,
including the off-site disposal of all fill material generated by the
construction of the Surface Water Management System in excess of Seller's
fill requirements for development of the Learning Center (as hereinafter
defined) and Purchaser's fill requirements for the Berm, if constructed by
Purchaser in accordance with subsection (d) below. Purchaser agrees that
it, and its successors and assigns, shall adhere to and comply with the
design of the Surface Water Management System in the development and use of
the Vistana Property, and in completing any portions of the Surface Water
Management System on the Vistana Property to be completed by Purchaser, if
any. Seller reserves the right, but has no obligation and shall incur no
liability thereby, to correct or conform any deficiencies or non-
conformities in the portions of the drainage system installed by Purchaser,
and all of Seller's costs and expenses in so doing shall be due and payable
by Purchaser upon receipt of an invoice therefor.
(d) Berm. Purchaser shall have the right to construct, at its sole
cost and expense, a landscape and noise berm ("Berm") on the Option Parcel
in the location to be shown on the Proposed Site Plan. If Purchaser elects
to construct the Berm, Seller shall grant an access, construction and
maintenance easement to Purchaser over such portion of the Option Parcel as
shall be reasonably necessary for Purchaser's construction and maintenance
of the Berm. Purchaser shall have the right to use up to 150,000 cubic
yards of fill material from the construction of the Surface Water
29
Management System for the Berm, provided in such event Purchaser shall pay
all costs incident to dredging such fill material, moving the same to the
Berm site, constructing the Berm, and thereafter maintaining the Berm. Any
fill material in excess of 150,000 cubic yards required by Purchaser for
the Berm shall be acquired by Purchaser from off-site sources (unless
Seller determines in its sole discretion that it does not require all of
the remaining fill material dredged in connection with the Surface Water
Management System) at Purchaser's sole cost and expense. Purchaser
acknowledges that the location for the Berm will be the right-of-way to be
dedicated on the Plat to St. Lucie County, Florida for a Southerly
connector road which may be required by the development order for the
Reserve DRI ("South Connector Road"). In the event Purchaser constructs the
Berm and St. Lucie County, Florida or the Florida Department of
Transportation subsequently requires that the South Connector Road be
constructed, Purchaser shall be solely responsible for all costs and
expenses of removing the Berm and of disposing off-site all fill material
used to construct the Berm.
(e) Utilities. Seller shall be responsible for the costs of
bringing all electricity, water, sewer and telephone utility lines
necessary for Purchaser's contemplated development and use of the Vistana
Property, to the boundary of the Vistana Property at such location(s) as
mutually agreed between Seller and Purchaser, simultaneously with the
construction of the Entrance Road as shown on the Plat. Seller shall also
reasonably cooperate with and assist Purchaser in obtaining commitments,
permits or the like for all electricity, water, sewer, telephone and other
utility services which Purchaser deems necessary or desirable for its
contemplated development and use of the Vistana Property, provided the same
is at no additional cost to Seller or Purchaser agrees to reimburse Seller
for all costs and expenses incurred in connection therewith.
6.4 Purchaser's Obligations. Subject to Section 6.03 above, Purchaser
acknowledges that any and all improvements which are required or which Purchaser
desires to make on the Vistana Property shall be the sole and exclusive
responsibility of Purchaser, and shall be made at the sole cost and expense of
Purchaser, including but not limited to: (i) the obligation to construct,
furnish and install all electricity, water, sewer and telephone utility lines
necessary for Purchaser's contemplated development and use of the Vistana
Property from the point of pick up at the Vistana Property line to the interior
thereof; (ii) the obligation to construct, furnish and install all other
utilities which Purchaser deems necessary or desirable for its contemplated
development and use of the Vistana Property, other than the utilities specified
in (i) above which Seller is required to construct to the boundary of the
Vistana Property pursuant to Section 6.03(e) above; (iii) the obligation to
install all
30
equipment and pay any and all connection fees necessary to connect the
improvements to be constructed on the Vistana Property by Purchaser to all such
utility services; (iv) the inspection, testing and compaction of soil and
subsurface conditions on the Vistana Property, or any clearing, grading, piling,
excavation, foundation or other earth or soil work required for Purchaser's
construction of its improvements on the Vistana Property; and (v) the obligation
to construct, furnish and install all improvements, equipment, fixtures,
furnishings, appliances and the like necessary for Purchaser's contemplated
development and use of the Vistana Property.
6.5 Development and Operation of Vacation Resort. Purchaser will use its
reasonable best efforts to construct and operate a golf-oriented vacation
ownership resort on the Vistana Property containing a minimum of two hundred
fifty (250) units ("Vacation Resort"). The development and operation of the
Vacation Resort shall be the responsibility of Purchaser and shall be made at
the sole cost and expense of Purchaser. The Vacation Resort will consist of (i)
vacation ownership units that will be sold on an interval ownership basis, and
(ii) related amenities and operations facilities on the Vistana Property.
Purchaser will also have the right to rent any of the unsold interval ownership
units in its inventory, and to rent the units prior to conversion to interval
ownership, on a transient basis. If after Purchaser has completed construction
of at least two (2) of its planned buildings, containing a total of
approximately fifty (50) units, and provided Purchaser has used its reasonable
best efforts to sell the units on an interval ownership basis, Purchaser
reasonably determines that the Vacation Resort will not be successful as an
interval ownership resort, then Purchaser shall have the right to convert the
portions of the Vistana Property already released from the Mortgage and any
improvements constructed thereon to whole ownership condominiums and/or to
rental units (on both a long term and transient basis). Any new condominium or
rental units which Purchaser thereafter elects to construct on such portions of
the Vistana Property shall be subject to design review by Seller in accordance
with Section 6.09 below. Purchaser may not convert any portion of the Vistana
Property which is still encumbered by the Mortgage to any use other than
vacation interval ownership, or release any portion of the Mortgage Property in
accordance with Section 1.02(c) with the intent to build other than vacation
interval ownership units, without first obtaining the written approval of
Seller, such approval not to be unreasonably withheld. If Seller does not
approve any such conversion, then Purchaser shall deed the remainder of the
Mortgage Property back to Seller and Seller shall release and discharge the Note
and Mortgage and satisfy the same of record, except for any amounts due to
Seller thereunder which are then accrued but unpaid. Upon such a reconveyance
the parties shall each execute and deliver all documents reasonably requested by
the other or by any title insurance company insuring the reconveyance as
necessary to consummate the reconveyance and to cancel and terminate the
transactions contemplated by this Agreement with respect to the reconveyed
property. All documentary stamp taxes,
31
recording fees and other expenses of the reconveyance shall be shared equally by
Seller and Purchaser at the closing of the reconveyance, except that each party
shall pay their own attorneys' fees. No such conversion of the Vacation Resort
to condominium or rental units will relieve Purchaser from the obligation to pay
royalties to Seller under the Marketing and Promotion Agreement upon the sale or
rental of units, and Seller may require as a condition of approval of the
conversion that Purchaser agree to reasonable modifications of the Marketing and
Promotion Agreement to provide for royalties to Seller based upon the sale or
rental of the converted units.
6.6 Cooperation. Both before and after the Closing, Seller and Purchaser
shall cooperate and work with any other owners and prospective purchasers of any
portion of the Option Parcel to develop cooperative marketing and operational
capabilities. Seller will use its reasonable best efforts to obtain a similar
covenant from any other owners and prospective purchasers of any portion of the
Option Parcel.
6.7 Compliance with Laws. Seller and Purchaser each covenant and agree
to observe, perform and adhere in all material respects to all applicable
statutes, ordinances, permits, approvals and regulations of all governmental
authorities having jurisdiction over the Option Parcel or Vistana Property, as
applicable, whether in effect at the date hereof or at the Closing date or
subsequently enacted. Purchaser further covenants and agrees to adhere to the
restrictions and perform the obligations under all agreements entered into by
and between Seller (prior to Closing, provided the same is disclosed in writing
to Purchaser) or Purchaser and governmental authorities or utility companies
with regard to construction on the Vistana Property, including without
limitation, any agreement entered into with the City of Port St. Lucie, Florida,
St. Lucie County, Florida, or any community development district or other
special taxing district having jurisdiction over the Vistana Property, for
water, sewer and storm water drainage services.
6.8 Compliance with DRI and P.U.D. Seller and Purchaser each agree to
conform to all applicable requirements of the Reserve DRI and the Reserve P.U.D.
from time to time existing and shall not in any manner jeopardize the standing
of either.
6.9 Approval of Plans. Purchaser shall submit to Seller exterior
architectural (elevation drawings, material and color samples) and landscape
plans for all improvements to be constructed by Purchaser on the Vistana
Property, and all other materials required to be submitted to Seller by any
provision of this Agreement, for Seller's prior review and approval, such
approval not to be unreasonably withheld. Seller shall have a period of ten (10)
days from the receipt of any such materials within which to disapprove of such
materials in writing to Purchaser stating the reasons for such disapproval and
any necessary revisions,
32
otherwise the materials shall be deemed to have been approved. Purchaser shall
resubmit revised documents to Seller within ten (10) days after Purchaser's
receipt of any such objections and proposed revisions from Seller, and the above
process shall be repeated. The revised materials shall incorporate all of the
revisions reasonably requested by Seller. Any and all other proposed documents,
advertising copy, press releases, governmental filings and the like by either
party required to be submitted to the other pursuant to any other agreement
between Seller and Purchaser or their affiliates, shall be subject to prior
review and approval within the time frames specified in those agreements.
6.10 Golf Learning Center. After the Closing, Seller or its affiliates
will construct and use its reasonable best efforts to operate, adjacent to the
Vistana Property as shown on the Proposed Site Plan, a golf learning center and
related practice facilities, which may include a driving range, practice putting
and chipping greens, practice golf holes, video analysis areas, classroom
instruction areas, and training equipment ("Learning Center"). Seller shall
provide Purchaser with copies of all plans and specifications for the Learning
Center prior to Seller's development thereof. Purchaser shall have the right to
comment to Seller on such plans and specifications; provided, however, subject
to consistency with the common and harmonious architectural themes and standards
to be mutually developed in accordance with Section 6.01 above, Seller may
accept or reject any of Purchaser's comments, in Seller's sole and absolute
discretion. Seller shall submit (a) its application for a permit for the
Learning Center from the South Florida Water Management District, and (b) its
site plan for the Learning Center to St. Lucie County for approval, by no later
than January 31, 1998. Seller shall also commence grading of the Learning Center
site by no later than December 1, 1998, and complete construction and open the
Learning Center for business by no later than December 31, 1999. If Seller shall
fail to comply with any of the deadlines set forth in the preceding two
sentences, subject to Force Majeure as hereinafter defined, then upon any such
failure Purchaser shall have the right to deed so much of the Vistana Property
as Purchaser shall not have commenced construction upon at that time back to
Seller, and Seller shall reimburse to Purchaser on a per acre basis, by wire
transfer of immediately available funds, the portion of the Purchase Price
previously paid by Purchaser for the property to be reconveyed, and Seller shall
cancel the Note and discharge and release the Mortgage of record, except for any
amounts due to Seller thereunder which are then accrued but unpaid. Upon such a
reconveyance the parties shall each execute and deliver all documents reasonably
requested by the other or by any title insurance company insuring the
reconveyance as necessary to consummate the reconveyance and to cancel and
terminate the transactions contemplated by this Agreement with respect to the
reconveyed property. All documentary stamp taxes, recording fees and other
expenses of the reconveyance shall be paid by Seller at the closing of the
reconveyance, except that each party shall pay its own attorneys' fees. If after
using its reasonable best efforts to operate the Learning Center as
33
contemplated by this Agreement, Seller reasonably determines that the Learning
Center will not be successful, then Seller shall have the right to convert the
Learning Center to any other use permitted on the Learning Center property by
applicable law, provided Seller will not convert the Learning Center property to
interval ownership units unless Purchaser has previously converted the Vacation
Resort away from interval ownership interests in accordance with Section 6.05
above, and provided further that Seller will not convert the Learning Center to
any use that is incompatible with Purchaser's Vacation Resort. "Force Majeure"
as used herein shall mean acts of God, earthquakes, blizzards, tornados,
hurricanes, fire, flood, malicious mischief, insurrection, riots, strikes,
lockouts, boycotts, picketing, labor disturbances, public enemy, war (declared
or undeclared), landslides, explosions, epidemics, compliance with any order,
ruling, injunction or decree by any court, tribunal or judicial authority of
competent jurisdiction, inability to obtain materials or supplies after the
exercise of all reasonable efforts, substantial interference in construction
activities resulting directly from Hazardous Waste remediation activities or
directly from construction activities or delays as to construction activities
conducted simultaneously on adjacent lands by or under the direction of
unrelated parties, inability to obtain water and sewer service and any other
similar circumstances beyond the reasonable control of Seller. Upon the
occurrence of any such Force Majeure event, Seller must give notice specifying
the Force Majeure event, in writing, to Purchaser within ten (10) days after
actual knowledge of its occurrence. Seller's obligation to perform shall be
suspended during the continuance of any inability to perform caused by the
occurrence of the Force Majeure event.
6.11 Survival. The provisions of this Article VI shall survive the
Closing of this Agreement.
SECTION VII
PROVISIONS WITH RESPECT TO
DEFAULT AND ATTORNEYS' FEES
---------------------------
7.1 Default by Seller. If Seller fails to consummate the transactions
contemplated in this Agreement for any reason, other than by reason of any
default by Purchaser hereunder, failure of any of the conditions precedent
specified in Section 4.02 above, or a breach by Purchaser of its representations
and warranties contained herein, then Purchaser shall have the right, as its
sole and exclusive remedy, to bring an action against Seller for specific
performance of this Agreement.
7.2 Default by Purchaser. If Purchaser fails to consummate the
transactions contemplated in this Agreement for any reason, other than by reason
of any default by Seller hereunder, failure of any of the conditions precedent
specified in Section 4.03 above, or a
34
breach by Seller of its representations and warranties contained herein, then
Seller shall have the right, as its sole and exclusive remedy, to receive from
Purchaser, and Purchaser shall be liable to Seller for, damages in the amount of
FIFTY THOUSAND AND NO/100 DOLLARS ($50,000.00). Such amount is agreed upon
between Seller and Purchaser as liquidated damages, and not as a penalty, due to
the difficulty and inconvenience of ascertaining and measuring the actual
damages as suffered by Seller. Notwithstanding the foregoing, if Purchaser files
a lis pendens against any portion of the Option Parcel or otherwise clouds
Seller's title to any portion of the Option Parcel, then Seller shall have all
rights and remedies available to it at law or in equity.
7.3 Attorneys' Fees, Etc. In connection with any litigation, action,
claim or other proceeding arising out of this Agreement, the prevailing party
shall be entitled to recover all reasonable costs, charges and expenses,
including, without limitation, reasonable attorneys' fees, paralegal fees,
investigative fees and other paraprofessionals' fees, and costs (even if not
taxable as court costs), incurred in connection with such litigation, action,
claim or other proceeding (including all such fees and costs incident to any
arbitration, mediation, appellate, post-judgment and bankruptcy or similar
debtor/creditor proceedings).
7.4 Survival. The provisions of this Article VII shall survive the
Closing or earlier termination of this Agreement.
SECTION VIII
BROKERAGE COMMISSIONS
---------------------
8.1 Brokerage Commissions. Each party represents to the other that no
brokers have been involved in this transaction, other than Monarch Partners, LLC
and Xxxx Xxxxx Associates, Inc. (collectively, "Brokers"), who have been
retained by and will be compensated by Purchaser pursuant to separate
agreement(s) with Purchaser. Purchaser shall indemnify, defend (with counsel
reasonably acceptable to Seller) and hold Seller harmless from any and all
claims or demands with respect to non-payment of the commissions due to the
Brokers, and shall cause the Brokers to each deliver a receipt and release of
commission to Seller and Purchaser upon payment of the commissions. Seller and
Purchaser agree to indemnify, defend (with counsel reasonably acceptable to the
other) and hold each other harmless from any and all claims or demands with
respect to any brokerage fees, commissions, finders' fees or other compensation
asserted by any person, firm or corporation claiming by or through said
indemnifying party in connection with the sale contemplated by this Agreement,
other than the Brokers or anyone claiming by, through or under the Brokers.
35
SECTION IX
RISK OF LOSS BY CONDEMNATION
----------------------------
9.1 Risk of Condemnation. All risk of condemnation prior to the Closing
shall be on Seller. Immediately upon obtaining knowledge of any proceedings for
the condemnation of the Vistana Property or any portion of it (including
negotiations in lieu of condemnation), Seller will notify Purchaser of the
pendency of such proceedings. Seller shall not be obligated to prosecute any
such proceeding.
9.2 Condemnation Proceedings. If, after the date of this Agreement and
prior to the Closing, all or a part of the Vistana Property is subjected to a
bona fide threat of condemnation (or sale in lieu of condemnation) Purchaser
may, by written notice to Seller, elect to cancel this Agreement prior to the
Closing, in which event both parties shall be released from any further
liability. In such event, the Deposit shall be returned to Purchaser and this
Agreement shall be null, void and canceled. If no such election is made, this
Agreement shall remain in full force and effect, and in such event the purchase
contemplated hereby, less any interest taken by eminent domain or condemnation,
shall be effected with no further adjustment and upon Closing Seller shall
assign all of its right and interest to any awards that have been or may be made
for such taking to Purchaser, which assignment shall survive the Closing.
SECTION X
OTHER CONTRACTUAL PROVISIONS
----------------------------
10.1 Assignability. Purchaser may assign its rights and obligations under
this Agreement and the other documents and agreements to be executed in
connection with this Agreement to any entity that controls, is controlled by or
under common control with Purchaser, and to the management entity for
Purchaser's Vacation Resort, and on a collateral basis, to any lender providing
acquisition or construction financing to Purchaser for the Vacation Resort.
Notwithstanding the foregoing, no such assignment shall discharge Purchaser from
its obligations hereunder or under such other documents and agreements, and the
Purchaser named herein shall remain jointly and severally liable with the
assignee for the performance of all covenants and obligations of the Purchaser
hereunder and thereunder. Purchaser may not assign any of its rights under this
Agreement to any other person or entity without the prior written consent of
Seller, which may be granted or withheld in Seller's sole and absolute
discretion. Seller may freely assign any of its rights or obligations under this
Agreement to any person or other affiliated entity which owns any portion of the
Option Parcel or which will carry out any of Seller's obligations under this
Agreement, with or
36
without the consent of Purchaser, upon notice to Purchaser and the assignee's
assumption of the obligations of Seller which are assigned to it.
10.2 Notices. Any notice to be given to either party in connection with
this Agreement must be in writing and given by hand-delivery, certified mail,
overnight delivery by a nationally recognized courier (such as FedEx or
Airborne), or facsimile transmission. Such notice shall be deemed to have been
given when received, or when delivery is refused, or when deemed undeliverable
by the postal authorities, as applicable. Such notices shall be given to the
parties at the following addresses or facsimile numbers:
To Purchaser: Vistana PSL, Inc.
0000 Xxxxxxx Xxxxxx Xxxxx
Xxxxxxx, Xxxxxxx 00000-0000
Attention: Xxxxxxx X. Xxxxxxx, Xx., Chairman
Xxxxx Xxxxx, Esq, Senior Vice President--Law
Fax No.: (000) 000-0000
And to: Xxxxx Xxxxx, Esq., Senior Vice President--Law
Vistana PSL, Inc.
c/o Weil, Gotshal & Xxxxxx LLP
000 Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxx, Xxxxxxx 00000
Fax No.: (000) 000-0000
With a copy to: Weil, Gotshal & Xxxxxx LLP
000 Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxx, Xxxxxxx 00000
Attention: Xxxxxxx X. Xxxxxxx, Esq.
Fax No.: (000) 000-0000
To Seller: PGA Golf Development, Inc.
000 Xxxxxx xx xxx Xxxxxxxxx
Xxxx Xxxxx Xxxxxxx, Xxxxxxx 00000
Attention: Chief Executive Officer
Fax No.: (000) 000-0000
37
With a copy to: Gunster, Yoakley, Xxxxxx-Xxxxx & Xxxxxxx, P.A.
Xxxxxxxx Point - Suite 500 East
000 Xxxxx Xxxxxxx Xxxxx
Xxxx Xxxx Xxxxx, Xxxxxxx 00000-0000
Attention: Xxxx W.A. Courtnell, Esq.
Fax No.: (000) 000-0000
Either party may, at any time, by giving five (5) days written
notice to the other party, designate any other address or facsimile number to
which such notice shall be given and other parties to whom copies of all notices
shall be sent.
10.3 Entire Agreement; Modification. This Agreement contains the entire
agreement between the parties. All prior agreements, understandings,
representations and statements, oral or written, are merged into this Agreement.
This Agreement cannot be modified or terminated except by an instrument in
writing signed by the party against whom the enforcement is sought.
10.4 Governing Law and Venue. This Agreement shall be governed by and
construed in accordance with the laws of the State of Florida. The parties
acknowledge that a substantial portion of negotiations, anticipated performance
and execution of this Agreement occurred or shall occur in Palm Beach and St.
Lucie Counties, Florida, and that, therefore, each of the parties irrevocably
and unconditionally (a) agrees that any suit, action or legal proceeding arising
out of or relating to this Agreement shall exclusively be brought in the courts
of record of the State of Florida in Palm Beach County or St. Lucie County, or
in the District Court of the United States, Southern District of Florida; (b)
consents to the jurisdiction of each such court in any suit, action or
proceeding; (c) waives any objection which it may have to the laying of venue of
any such suit, action or proceeding in any of such courts; and (d) agrees that
service of any court paper may be effected on such party by mail, as provided in
this Agreement, or in such other manner as may be provided under applicable laws
or court rules in said state.
10.5 Arbitration. Any controversy or claim between or among the parties
hereto, including but not limited to those arising out of or relating to this
Agreement or any related agreements or documents, including any claim based on
or arising from an alleged tort, other than any action arising under Sections
3.02, 6.05 or 6.10 respecting Purchaser's rights to reconvey the Vistana
Property or portions thereof back to Seller, and Seller's obligations to accept
the reconveyance thereof and refund the portions of the Purchase Price paid by
Purchaser and to discharge the Note and Mortgage, and other than any action
arising under Sections 7.01 or 7.02 respecting actions for specific performance
of this Agreement or any
38
other equitable remedy, and other than any foreclosure or other enforcement
action by Seller arising under the Mortgage, shall be determined by binding
arbitration in accordance with the Federal Arbitration Act (or if not
applicable, the applicable state law), and the Rules of Practice and Procedure
for the Arbitration of Commercial Disputes of Judicial Arbitration and Mediation
Services, Inc. ("JAMS"), unless otherwise provided in this provision. Judgment
upon any arbitration award may be entered in any court having jurisdiction. Any
party to this Agreement may bring an action, including a summary or expedited
proceeding, to compel arbitration of any controversy or claim to which this
Agreement applies in any court having jurisdiction over such action.
(a) The arbitration shall be conducted in Palm Beach County and
administered by JAMS who will appoint an arbitrator; or if JAMS is unable
or legally precluded from administering the arbitration, then the American
Arbitration Association will serve. All arbitration hearings will be
commenced within ninety (90) days of the demand for arbitration. Upon a
showing of cause, the arbitrator shall be permitted to extend the
commencement of such hearing for up to an additional sixty (60) days.
(b) Nothing in this Agreement shall be deemed to (i) limit the
applicability of any otherwise applicable statutes of limitation or any
waivers contained in this Agreement; or (ii) limit either party's right to
obtain from a court provisional or ancillary remedies before, during or
after the pendency of any arbitration proceeding. Such action for remedies
shall not constitute a waiver of the right of any party, including the
claimant in any such action, to arbitrate the merits of the controversy or
claim occasioning resort to such remedies.
10.6 Headings. Descriptive headings are for convenience only and shall
not control or affect the meaning or construction of any provision of this
Agreement.
10.7 Binding Effect. The term "Purchaser" shall include Purchaser's
successors and permitted assigns. The term "Seller" shall include Seller's
successors and assigns.
10.8 Counterparts. This Agreement may be executed in several
counterparts, each constituting a duplicate original. All such counterparts
shall constitute one and the same agreement. Confirmation of execution by
electronic transmission of a facsimile signature page shall be binding upon any
party so confirming.
10.9 Interpretation. Whenever the context of this Agreement shall so
require, the singular shall include the plural, the male gender shall include
the female gender and the
39
neuter and vice versa. This Agreement was drafted through the efforts of both
parties and shall not be construed in favor of or against either party.
10.10 Severability. If any provision contained in this Agreement shall be
held invalid, illegal or unenforceable in any respect, such invalidity,
illegality or unenforceability shall not affect any other provision. This
Agreement shall be construed as if such invalid, illegal or unenforceable
provision had never been contained in this Agreement.
10.11 Recording. Seller and Purchaser agree that neither this Agreement,
nor a copy of this Agreement, nor any memorandum or short form of this
Agreement, other than the documents and instruments recorded in connection with
the Closing, shall ever be filed of record in the Public Records of St. Lucie
County, Florida, and in the event that this Agreement, a copy of this Agreement,
or any memorandum or short form of this Agreement is so filed by Purchaser or
its agents or employees, other than the documents and instruments recorded in
connection with the Closing, such act will be considered a default under this
Agreement and Seller, at Seller's option, may terminate this Agreement and
exercise any other rights or remedies of Seller under this Agreement for a
default on the part of Purchaser. In addition, Purchaser hereby appoints Seller
as Purchaser's agent and attorney-in-fact with full power and authority to
execute and record any and all documents deemed necessary by Seller to release,
explain or terminate such document wrongfully filed of record. Such appointment
is coupled with an interest and is irrevocable.
10.12 Time of Essence. Time is of the essence of this Agreement.
10.13 Confidential Information. Each party agrees that any information
provided at any time to such party by the other party in connection with the
negotiation, performance, or enforcement of this Agreement which has not been
generally disclosed to the public (the "Confidential Information"), including,
without limitation, any information contained in proprietary software systems,
any management techniques, and any customer and database information provided
pursuant to any license or affiliation agreement entered into pursuant to this
Agreement, shall be kept in confidence; provided, however, that any of such
information may be disclosed to a party's employees, agents, attorneys,
auditors, accountants, financial advisers, banks or other financial sources that
need to know such Confidential Information (it being agreed that such
representatives or persons will be informed by such party of the confidential
nature of such Confidential Information and directed to treat such Confidential
Information confidentially, and that such party will be responsible for any
disclosures of Confidential Information by its representatives). In the event
that a party becomes legally compelled to disclose any Confidential Information,
such party shall provide the other party with prompt prior written notice of
such requirement so that the other party may seek a
40
protective order or other appropriate remedy, unless such notice is prohibited
by law. In the event such protective order or other remedy is not obtained, the
party legally compelled to disclose such Confidential Information agrees to
disclose only that portion of the Confidential Information which, in the opinion
of such party's counsel, is legally required to be disclosed.
10.14 Further Assurances. In addition to the other obligations required to
be performed under this Agreement, Seller and Purchaser each agree to execute,
acknowledge and deliver such other instruments, documents and other materials as
the other may reasonably request in order to consummate the transactions
contemplated in this Agreement.
10.15 WAIVER OF JURY TRIAL. PARTIES HERETO MUTUALLY AND WILLINGLY WAIVE THE
RIGHT TO A TRIAL BY JURY OF ANY AND ALL CLAIMS MADE AMONG THEM WHETHER NOW
EXISTING OR ARISING IN THE FUTURE, INCLUDING WITHOUT LIMITATION, ANY AND ALL
CLAIMS, DEFENSES, COUNTERCLAIMS, CROSS CLAIMS, THIRD PARTY CLAIMS AND
INTERVENOR'S CLAIMS, WHETHER ARISING FROM OR RELATED TO THE NEGOTIATION,
EXECUTION OR PERFORMANCE OF THIS AGREEMENT.
10.16 Survival. The provisions of this Article X shall survive the
Closing or earlier termination of this Agreement.
41
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first-above written.
Signed, sealed and delivered "Seller"
in the presence of:
PGA GOLF DEVELOPMENT, INC., a
Florida corporation
/s/ Xxxxx Xxxxxxxxxx By: /s/ Xxx X. Xxxxxx
-------------------------------- -----------------------------
Print Name: Xxxxx Xxxxxxxxxx Print Name: Xxx X. Xxxxxx
--------------------- ---------------------
Its: Chief Executive Officer
----------------------------
/s/ Xxxx X. Xxxxxxxxx
-------------------------------- Date: August 12, 1997
Print Name: Xxxx X. Xxxxxxxxx ---------------------------
---------------------
JOINDER OF PGA GOLF PROPERTIES, INC.
PGA GOLF PROPERTIES, INC. hereby joins in this Agreement for the limited purpose
of consenting to the provisions of Sections 5.02(g) and (h) hereof, but is not
otherwise a party to this Agreement.
PGA GOLF PROPERTIES, INC., a
Florida corporation
/s/ Xxxxx Xxxxxxxxxx By: /s/ Xxx X. Xxxxxx
-------------------------------- -----------------------------
Print Name: Xxxxx Xxxxxxxxxx Print Name: Xxx X. Xxxxxx
--------------------- ---------------------
Its: Chief Executive Officer
----------------------------
/s/ Xxxx X. Xxxxxxxxx
-------------------------------- Date: August 12, 1997
Print Name: Xxxx X. Xxxxxxxxx ---------------------------
---------------------
[SIGNATURES FOR PURCHASER ENTITIES FOLLOW]
42
"Purchaser"
---------
VISTANA PSL, INC., a Florida
corporation
/s/ Xxxxx Xxxxxxxx By: /s/ Xxxxxxx X. Xxxxxxx, Xx.
--------------------------------- --------------------------------
Print Name: Xxxxx Xxxxxxxx Print Name: Xxxxxxx X. Xxxxxxx, Xx.
---------------------- ------------------------
Title: Chairman
/s/ Xxxxx X. Xxxxx -----------------------------
---------------------------------
Print Name: Xxxxx X. Xxxxx Date: August 12, 1997
---------------------- -----------------------------
JOINDER OF VISTANA, INC.
VISTANA, INC. hereby joins in this Agreement for the limited purpose of
consenting to the provisions of Section 5.03(f) hereof, but is not otherwise a
party to this Agreement.
VISTANA, INC., a Florida
corporation
/s/ Xxxxx Xxxxxxxx By: /s/ Xxxxxxx X. Xxxxxxx, Xx.
--------------------------------- --------------------------------
Print Name: Xxxxx Xxxxxxxx Print Name: Xxxxxxx X. Xxxxxxx, Xx.
---------------------- ------------------------
Title: Chairman
/s/ Xxxxx X. Xxxxx -----------------------------
---------------------------------
Print Name: Xxxxx X. Xxxxx Date: August 12, 1997
---------------------- -----------------------------
43
EXHIBIT "A"
-----------
Legal Description of Option Parcel
44
EXHIBIT "B"
-----------
Legal Description of Vistana Property
EXHIBIT "C"
-----------
Form of Access and Utility Easement
EXHIBIT "D"
-----------
Legal Description for Access and Utility Easement
EXHIBIT "E"
-----------
Form of Golf Access Easement
EXHIBIT "F"
-----------
Legal Description of Initial Development Parcel
EXHIBIT "G"
-----------
Form of Promissory Note
EXHIBIT "H"
-----------
Form of Purchase Money Mortgage
EXHIBIT "I"
-----------
Preliminary Site Plan
EXHIBIT "J"
-----------
Form of Marketing and Promotion Agreement
EXHIBIT "K"
-----------
Form of Affiliation Agreement
