PURCHASE AGREEMENT
THIS AGREEMENT is entered into this 2nd day of July, 1999, by and between
Maple Grove Apartment Home, Inc., a Wisconsin corporation (hereafter referred to
as the "Seller"), and The Shelard Group, Inc., a Minnesota corporation, or its
designee, (the "Buyer"), upon the basis of the following facts, understandings
and intentions of Seller and Buyer.
RECITALS:
1. Seller is the fee owner of a parcel of property ("Land") currently
improved with fifteen (15) residential apartment buildings containing in the
aggregate three hundred four (304) residential apartment units (hereafter in the
aggregate the "Buildings") together with miscellaneous improvements to the Land
("Miscellaneous Improvements") commonly known as the "Maple Grove Apartments"
located at 0000 Xxxxx Xxxxxx Xxxxx, Xxxx xx Xxxxxxx, Xxxxxx of Dane, Wisconsin
and legally described in Exhibit A hereto attached;
2. Buyer desires to purchase the Land, the Buildings, the Miscellaneous
Improvements, and all licenses, trade names (including the name "Maple Grove
Apartments" and variations thereof), permits, equipment, fixtures and
furnishings and all other personal property, tangible or intangible, owned by
Seller and physically located on the Land and used in the operation and
maintenance of the foregoing and any computer programs which are transferable
and all data bases on any type of computer or computer related storage used in
the operation of the foregoing (hereafter said licenses, trade names, permits,
equipment, fixtures, furnishings and other personal property and computer
programs, data bases and computer related storage items shall be referred to in
the aggregated as "Personal Property," and hereafter the Land, the Buildings,
the Miscellaneous Improvements, and Personal Property is sometimes referred to
in the aggregate as the "Property") in accordance with the terms and conditions
hereinafter set forth; and
3. Seller is willing to grant and extend to Buyer such purchase right.
NOW, THEREFORE, in consideration of the agreements hereinafter provided and
other good and valuable consideration, Seller agrees to sell and Buyer agrees to
purchase from Seller the Property, together with and including all
hereditaments, appurtenances, easements and right of ways thereunto belonging or
in any way appertaining and also the right, title and interest (if any) of
Seller in and to the bounding and abutting streets, alleys and highways, subject
to and upon the following terms and conditions:
SECTION I.
PURCHASE PRICE
It is hereby agreed that the Purchase Price of the Property shall be
Sixteen Million Seven Hundred Thousand and no/100 Dollars ($16,700,000.00) (the
"Purchase Price"), which shall be paid by Buyer to Seller as follows:
(a) $100,000.00 xxxxxxx money to be paid into escrow as provided for
in Section II below;;
(b) Approximately $12,680,000.00 by Buyer agreeing to assume and pay
according to its terms that certain existing first mortgage on the Property
("Mortgage") and
(c) By Buyer paying at closing in cash the difference between the
unpaid portion of the Purchase Price and the remaining unpaid principal amount
of the Mortgage as of the date of closing being approximately $16,600,000.00
less $12,680,000.00 or $3,920,000.00 subject to adjustments and prorations at
closing as described herein.
SECTION II.
XXXXXXX MONEY DEPOSIT
Currently with the execution of this Agreement, Buyer shall deposit in
escrow with First American Title Insurance Company (the "Escrow Agent") and
(sometimes hereafter "Title") the sum of $100,000.00 and any additional xxxxxxx
money sums paid herein by Buyer (collectively referred to as "Deposit") which
shall be retained by the Escrow Agent for the benefit of Seller and Buyer in
accordance with the provisions of this Agreement. The parties hereby agree to
execute such documentation, if any, reasonably required by the Escrow Agent in
connection with the disbursement of the Deposit and establishment of said
Deposit account referenced above.
SECTION III.
INVESTMENT AND DISBURSEMENT OF DEPOSIT
The Escrow Agent is hereby directed to invest the Deposit in a segregated
interest-bearing money market bank deposit with an established local bank.
The Deposit shall be disbursed by the Escrow Agent as follows:
(a) Except as provided for in (b) below, in the event Buyer fails to
terminate this Purchase Agreement pursuant to Section IV hereof within 14 days
after Buyer has received a fully executed copy of this Purchase Agreement
executed by Seller as well as Buyer, ("Early Termination Date"), the Deposit
shall be delivered to Seller upon the termination of this Agreement.
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(b) The Deposit shall be delivered to Buyer in the event Buyer
terminates this Agreement pursuant to Section IV (d), (e), (f), (g) or (h) or
Sections VI, XVI and XVII or if Buyer terminates this Agreement prior to the
Early Termination Date pursuant to any other subsections of Section IV.
(c) In the event Buyer proceeds to closing, the Deposit shall be
delivered to Seller at closing as part payment of the Purchase Price.
(d) Upon the disbursement of the Deposit, any interest earned thereon
shall be paid to Buyer.
SECTION IV.
CONDITIONS PRECEDENT
Seller agrees that this Agreement shall be conditioned upon Buyer
satisfying himself, in his sole and absolute judgment, that the following
contingencies with respect to the Property are met:
(a) Buyer's inspection and approval of the Land, the completed
Buildings, the completed Miscellaneous Improvements, Personal Property, Leases
(as hereafter defined), the Other Agreements (as hereafter defined) and all
other information required herein to be provided to Buyer by Seller, all during
regular weekday business hours. Seller agrees to allow buyer and its agents the
right of any ingress or egress over and through the Property for the purpose of
inspecting and testing the same and making other observations as Buyer deems
reasonably necessary. Buyer agrees to indemnify and hold Seller harmless from
all injury, death or property damage or claims of any kind whatsoever arising
out of or in any way incidental to Buyer's presence on the Property for the
purposes aforesaid. The parties acknowledge that Buyer has not had an
opportunity to examine the items relating to the Property prior to execution of
this Agreement. Seller hereby agrees to provide Buyer with the following items
within five (5) days from the execution of this Agreement and to supplement the
same on a monthly basis between the date of execution of this Agreement and the
closing:
(i) Complete Plans and Specifications, blueprints, operating
manuals, and licenses used to construct and to operate the Buildings and the
remainder of the Property;
(ii) Complete copies of all leases and rental agreement and
amendments thereto relating to the operation of the Building ("Leases");
(iii) Complete copies of all contracts or other agreements of any
kind or nature currently affecting the Property ("Other Agreements") including
management agreements with resident or non-resident managers, if any, service
contracts, title policies or opinions by Seller's attorneys as to the title,
copies of all insurance polices insuring the Property and any parking or
cross-parking agreements;
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(iv) A copy of the rent roll as of the last day of the month
preceding the date hereof showing all delinquencies, including a current summary
of any and all other tenant defaults under the Leases and further containing the
following information: (i) the space occupied; (ii) the name of the tenant;
(iii) the term of the Lease; (iv) the monthly rental, escalations or
pass-throughs; (v) whether rental includes utilities or other services; (vi) the
security or other deposit collected and/or applied; (vii) the amount of prepaid
rent, if any; and (viii) any provisions concerning concessions, extensions,
offsets, expansion rights, termination rights, allowances, options or any other
extraordinary provision;
(v) Copies of all certificates and policies of insurance held by
Seller with respect to the Property;
(vi) Copies of all permits or authorizations required to be
issued by any governmental body having jurisdiction in connection with any state
of facts or activity presently existing or being carried on with respect to the
Property;
(vii) Copies of all warranties and guaranties which pertain to
the Property or any portion thereof ("Warranties");
(viii) A complete statement of operating income and expenses for
the Property for the last three (3) years. Said financial statements shall
include those statements used in preparation of the tax returns filed with the
Internal Revenue Service;
(ix) Inventory of the Personal Property owned by the Seller and
located on the Land and used in connection with the operation of the Property
including, but not limited to, appliances located in the apartments, licenses,
permits and equipment;
(x) A complete vendor and supplier list containing the names,
addresses and telephone numbers of all vendors and suppliers and a list of
products or services which they each furnish;
(xi) Copies of real estate tax statements for the Property for
taxes due and payable in 1999 ("1999 Real Estate Tax Statements") along with
copies of statements of assessed value for taxes due and payable in the years
1998 and 1997;
(xii) Copies of the Mortgage and the underlying debt instruments
and related collateral documents.
(b) Buyer may use the Property for residential apartment purposes
("Current Uses") without being in violation of any zoning classification, land
use classification, environmental requirement, or any other use classification
or building classification or requirement established by any entity or authority
having legal jurisdiction or authority thereof.
(c) All utilities, including but not limited to electricity, gas,
water (fire and domestic) storm and sanitary sewer, are available on site,
through valid and adequate
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public or private easements for Current Uses; provided that in the case of
private easements, they are appurtenant to the Property, or on the Property's
side of abutting streets of size and capacity sufficient to serve the Current
Uses.
(d) That none of the encumbrances set forth on Exhibit B attached (the
"Permitted Encumbrances") interfere with the Current Uses.
(e) Buyer obtaining, as provided in Section V(A) hereof, a hazardous
waste report for the Property from Buyer's approved environmental consultant and
certified in favor of buyer showing the absence of hazardous substance,
pollutants and trash thereon, and also showing the absence of asbestos or other
materials that may create a health risk together with a certificate from
Seller's architect certified in favor of Buyer certifying that the Plans and
Specifications for the Building and the Miscellaneous Improvements did not
require in the construction thereof, the use of asbestos or other products that
are presently considered a health risk.
(f) Written approval of the assumption of the Mortgage by Buyer and
the sale of the Property to Buyer by the holder of the Mortgage, which approval
shall be obtained by Seller. All costs and expenses including, but not limited
to, the payment to such holder of any "assumption fee" or similar fees that may
be charged by such holder shall be paid at the closing fifty percent (50%) by
the Seller and fifty percent (50%) by the Buyer.
(g) Buyer concluding that the Property is not in violation of the Fair
Housing Act (42 U.S.C.ss.3601, etc.).
(h) All of Seller's warranties contained herein are true and correct
now and as of the date of closing.
The conditions precedent enumerated above shall be deemed not found to
exist to the satisfaction of Buyer, and this Agreement shall be deemed
terminated unless Buyer gives written notice hereunder to Seller that Buyer
affirmatively satisfies or waives in writing the conditions precedent prior to
the Early Termination Date with respect to subparagraphs (a), (b) and (c) above
and prior to closing, as hereafter defined, with respect to subparagraphs (d),
(e), (f), (g) and (h). Upon termination of this Agreement as a result of Buyer's
not waiving these conditions precedent, all parties hereto shall be released
from all duties and obligations to each other contained herein.
SECTION V.
ENVIRONMENTAL AUDITS AND SURVEY
A. Environmental Audits. Buyer shall obtain, at Buyer's sole cost and
expense, a "Phase One and/or Phase Two" environmental audit(s) done currently
certified to Buyer.
Notwithstanding the foregoing, Buyer shall have the right to do additional
environmental audits and/or soil tests regardless of the cost as long as Buyer
pays for all of
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such costs. Buyer agrees to indemnify and hold Seller harmless from all
mechanic's liens liability and other costs and expenses arising from Buyer's
doing such additional environmental audits and/or soil tests.
B. Survey. Buyer shall as promptly as possible after the date hereof obtain
a current "as built" survey of the Property currently certified to Buyer and
Title as legally described in Exhibit A meeting such as the requirements of an
ALTA/ACSM Land Title Survey as Buyer deems appropriate.
C. Copies of Seller's Documents. Seller shall promptly deliver to Buyer
copies of all soil tests, environmental audits, surveys and other documents
relating to the physical properties of the Property which are within Seller's
control.
SECTION VI.
TITLE EVIDENCE
A. Buyer shall as soon as possible, at Buyer's expense, obtain a
commitment(s) (the "Commitment") for an Owner's Policy of Title Insurance for
the Property issued by Title. Buyer shall pay at closing the cost of the actual
title insurance policy, if any, to be purchased by Buyer in the amount of the
Purchase Price. The Commitment shall bear a date subsequent to the date hereof,
shall include legible copies of all documents, maps, or plats set forth therein
as affecting the Property and shall be issued through the Title in its capacity
as a title insurance company by its local office or by its local agent situated
in a County where the Property is located. The Commitment shall identify the
Property and easements appurtenant thereto by the legal description(s) set forth
on the Survey. The Commitment shall, at Buyer's option, contain endorsements
guaranteeing: (i) all parcels shown in Exhibit A which comprise the Property to
be contiguous; (ii) the zoning classification of the Property; (iii) that the
Property abuts the public street(s) immediately adjacent thereto and has direct
and valid access thereto; and (iv) such other endorsements as Buyer shall
reasonably request.
B. Within twenty (20) business days after receipt of both the Commitment in
the form specified above and the Survey to be obtained by Buyer pursuant to
Section V hereof, Buyer shall deliver to Seller a written statement containing
any objection Buyer has to title. If such statement is not delivered within the
twenty (20) business day period, title shall be deemed approved by Buyer. If
such statement is so delivered, Seller shall use its best efforts and all due
diligence to cure or remove all such objections prior to closing. If any
objection is not cured or removed within one hundred twenty (120) days of the
receipt by Seller of the aforesaid written statement containing objection of
Buyer to title, Buyer, at its option, may either: (i) accept title as it is,
subject to the right to deduct from the Purchase Price liens or encumbrances
securing a definite or ascertainable amount; (ii) cure such objections itself at
Seller's expense and proceed to closing, in which case Seller agrees to escrow
with the Title Company such reasonably estimated expenses and attorneys' fees
needed to cure such objections and be responsible for any deficiencies in the
escrowed amount; or (iii) terminate this Agreement. Upon any such termination
all parties shall be released from all duties or
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obligations contained herein and the Deposit returned to Buyer as provided for
in Section II hereof.
SECTION VII.
1031 EXCHANGE
At either party's request, the other party agrees to cooperate with the
requesting party in a deferred or simultaneous ss. 1031 like kind exchange of
the Property as long as the other party is not required to take title to any
other property or to incur any further cost, expense, liability or delay.
SECTION VIII.
INTENTIONALLY LEFT BLANK
SECTION IX.
WARRANTIES
Seller warrants and represents to Buyer that the following statements are
now, and will at the closing, be true and accurate:
(a) Seller will have marketable and insurable record title to the
Property as of closing subject only to the Permitted Encumbrances listed on
Exhibit B attached hereto and made a part hereof.
(b) The information supplied to Buyer pursuant to Section IV(a) hereof
is complete and materially correct and has been duly supplemented including, but
not limited to, any new Other Agreements;
(c) At closing Seller shall: (i) convey to Buyer by Warranty Deed the
Property; (ii) convey by Warranty Xxxx of Sale the Personal Property to Buyer
free of all leases, conveyances or other transfers or encumbrances on the
Property or any portion thereof except for Permitted Encumbrances and other
matters approved by Buyer pursuant to Sections IV, VI or VII or as otherwise
provided herein; (iii) shall assign all of Seller's interest in the Leases and,
to the extent requested by Buyer and to the extent they are assignable, all of
Seller's interest in the "Other Agreements," (iv) shall execute an
Indemnification Agreement ("Indemnification Agreement") with Buyer in the form
of Exhibit C hereto attached; and (v) shall assign to Buyer all of Seller's
interest, if an, in the name "Maple Grove Apartments" or variations thereof;
(d) Seller has not received any notice nor are they aware of any
pending action to take by eminent domain or by deed in lieu thereof all or any
portion of the Property;
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(e) Seller shall be solely responsible for and shall pay on the date
of closing any deferred tax or assessment, catch-up or adjustment in future
taxes due as a result of the Property having been classified under any
designation authorized by law to obtain a special low ad valorem tax rate or
receive either an abatement or deferment of ad valorem taxes;
(f) Seller is not a "foreign persons" as contemplated by Section 1445
of the Internal Revenue Code, and that at the closing Seller will deliver to
Buyer a certificate so stating, in a form complying with the Federal tax law;
(g) Seller has the full right, power and authority to enter into this
Agreement and to carry out the terms and provisions hereof including, but not
limited to, compliance with all appropriate procedures to authorize the
execution and delivery or this Agreement;
(h) The Property has not been used for storage or disposal of, nor
does it contain, any hazardous substance or high concentrations or pollutants or
contaminants, including but not limited to, those defined in any federal or
state environmental law nor has the Property been used for the dumping or trash
or other waste products; and Seller has no knowledge or belief that any other
person has so used the Property. Any asbestos or other health endangering
elements or chemicals are either absent from the Property or are properly
encapsulated and do not present any health risk;
(i) No unrecorded condition, restriction, obligation or agreement
shall exist which shall materially and adverse affect the Property or Buyer's
ability to use the Property for the Current Uses;
(j) No portion of the Property is located within an area designated as
a "floodplain" or "flood prone area" under any statute, regulation, or
ordinance. The Property is free from any use or occupancy restrictions, except
those imposed by zoning laws and regulations, and no part is dedicated or has
been used as a cemetery or burial ground;
(k) To the best of Seller's knowledge, no fact or condition exists
which would result in the termination of the current access to the Property from
any presently existing streets and roads adjoining or situated on the Property
or to any existing sewer or other utility Facilities servicing, adjoining or
situated on the Property. All utilities needed for Current Uses are available to
the Property.
(l) There is no default under the Mortgage, Seller has paid in full
for all labor and materials which have been furnished to the Property and there
is no litigation at law or in equity, and no proceedings of any administrative
or regulatory authority pending or threatened against the Seller or affecting
the Property;
(m) All required foreign, federal and state tax returns, reports and
estimates have been correctly prepared and filed by Seller for all of the years
and periods for which any returns, reports or estimates were due, and all taxes,
interests and penalties payable have been paid by Seller so there is and shall
be no claim or lien or charge for taxes asserted
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against the Property. All contributions required to be paid by Seller to any
unemployment, workers compensation or other governmentally administrated
programs have been paid as and when due and there are no deficiencies in
Seller's said account with respect to the Property. Seller will terminate all of
its employees and Seller will pay, prior to or on the date of closing, to all of
their employees all wages, fringe benefits, all accrued sick and vacation pay
through the date of closing.
(n) Seller warrants that there are no material defects or structural
defects in the assets being transferred hereunder including, but not limited to,
water leakage, flooding, seepage or drainage problems with the Property and
there are no outstanding citations or notices of violations of any statutes,
ordinances or regulations of any kind, nor has Seller ever been so cited or
noticed with respect to the Property except Seller has received a letter of
inquiry from the United States Department of Justice attempting to determine
whether the Property complies with the Fair Housing Act, 42 U.S.C. ss. 3601,
etc.
(o) The Property is zoned for the Current Uses and the Property
complies with the parking, setback and other requirements of the applicable
zoning ordinances;
(p) All instruments, other documents and written information delivered
to Buyer by or on behalf of Seller shall be complete and correct in all respects
as of the date of delivery to Buyer and as of the closing date. Seller has not
knowingly withheld from Buyer any documents or other information material to the
Property or the transactions contemplated in this Agreement;
(q) The Property contains no individual sewage treatment system nor
does it contain any xxxxx and the Property does not contain any underground
storage tanks containing fuel, oil or any other hazardous materials.
Seller agrees to indemnify and hold Buyer harmless from all claims,
expenses and liabilities (including reasonable attorney's fees)
incurred by Buyer as a result of Seller's breach of any of the
foregoing warranties. Seller further agrees to defend, indemnify and
hold harmless Buyer and all other persons and entities subsequently
owning and/or possessing the Property or any portion thereof and from
any and all liabilities (including but not limited to attorney's fees),
claims, demands, actions, causes of action, in law or in equity,
whether past, present or future, known or unknown, liquidated or
unliquidated, whether in tort, contact, statutory cause of action or
administrative agency proceeding or otherwise, whether for personal
injury, property damage, clean-up, remedial or response costs, wrongful
death, or loss of consortium or support which arise out of or in any
way relate to activities which Seller has conducted on the Property.
SECTION X.
CLOSING
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Subject to any extension as hereafter provided or agreed to in writing by
the parties, the closing of this transaction shall take place in the office of
Title on or before August 6, 1999. Notwithstanding anything hereunder to the
contrary and except for the 120-day period given to Seller to cure title defects
in Section VI B, if in the event that the closing of the transactions
contemplated by this Agreement have not occurred on or prior to September 1,
1999, any party hereto shall have the unilateral right to elect to terminate
this Agreement. If such an election to terminate occurs, no party hereunder
shall have any liability whatsoever to any other party hereunder. Possession of
the Property shall be deemed to have been given by Seller to Buyer coincident
with the closing. The following procedure shall govern the closing:
(a) Prior to the closing, Seller shall deliver to Buyer and the Title
Company a copy of the proposed general Warranty Deed (the "Deed") which shall be
in recordable form and shall convey good and marketable record title to the
Property (using the legal descriptions set forth on the survey provided by
Seller) to Buyer, subject only to current real estate taxes, the Permitted
Encumbrances and other matters approved by buyer. If the form of the deed does
not comply with the provisions set forth above, the Seller shall promptly
correct the same upon notice from either buyer or the Title Company;
(b) On or before the closing, Seller shall deliver to the Title
Company or Buyer the following:
(i) the Deed, properly executed and acknowledged along with the
Deposit and a standard form Seller's Affidavit;
(ii) current real estate tax statements;
(iii) any applicable owner's duplicate certificates of title to
the Property;
(iv) any applicable abstracts of title;
(v) a warranty of xxxx of sale properly executed for all Personal
Property including all of Seller's supply of lease forms, advertising material
and other business forms;
(vi) properly executed assignments of all Seller's interest in
and to the Leases and the original copies of all the Leases then in force and
effect on the Property as of the closing and Other Agreements and the original
copies of the Other Agreements (to the extent Buyer has requested the same and
to the extent they are assignable), together with a current rent roll for
tenants of the Property, and al security deposits and accrued statutory interest
thereon, prepaid rents and other deposits made by tenants of the Property;
(vii) a properly executed Indemnification Agreement;
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(viii) the Plans and Specifications for the improvements to the
Property;
(ix) an assignment of the warranties and any other documents
required by this Agreement;
(x) any other documentation reasonably requested by the Title
Company in order to confirm the authority of the Seller to consummate this
transaction or to permit the Title Company to issue to Buyer, upon completion of
the closing, its Owner's Title Insurance Policy in an amount equal to the
Purchase Price, subject only to those matters shown on the Commitment which were
approved by buyer (the "Title Policy"); provided, however, that the foregoing
shall not be construed to obligate Seller to provide any indemnity or to pay any
sums not otherwise required to be paid by Seller hereunder;
(xi) such funds may be required by Seller to pay closing costs or
charges properly allocable to Seller;
(c) On or before the closing Buyer shall deliver to the Title Company
or Seller the following:
(i) a properly executed Indemnification Agreement;
(ii) such additional funds as may be required of Buyer to pay the
Purchase Price, closing costs or charges properly allocable to Buyer.
(d) After the Title Company has received all of the items to be
deposited with it, and when it is in a position to issue the Title Policy
reflected by the approved Commitment, the Title Company shall;
(i) record the Deed instructing the Recorder's Office to return
the same to Buyer;
(ii) record any other instruments executed by the parties, or
either of them, which are contemplated by this Agreement to be placed of record,
instructing the Recorder's Office to return the same to the beneficiary thereof;
(iii) issue to Buyer its Title Policy and deliver to Buyer all
other documents to be herein deliver by Seller to the Title Company pursuant to
this Agreement;
(iv) charge Buyer for the cost of the title policy and survey,
the recording cost of the Deed and the closing fee less abstracting charges
and/or the cost of the title commitment which shall be charged to Seller;
(v) charge Seller for the cost of recording any documents
clearing title to the Property, any abstracting costs and/or the cost of the
title commitment, and the cost, if any, of Buyer assuming the Other Agreements;
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(vi) charge Seller for the full cost of any deed transfer,
revenue or similar tax with respect to the sale of the Property;
(vii) 1998 real estate taxes and for prior years shall be paid by
Seller and 1999 real estate taxes shall be prorated as of the date of closing.
Seller shall pay all real estate taxes for 1998. All special assessments, levied
or pending, including interest thereon, against the Property on the closing
date, including, without limitation, trunk area charges and charges for lateral
benefit from truck which remain unpaid in respect of the Property for sanitary
sewer and storm sewer shall be paid for by Seller. If year 1999 real estate
taxes are not available, then a proration shall be made based on the preceding
years amount, and the amount of such taxes shall be adjusted when the current
amount becomes known;
(viii) all revenues and income, in connection with the operation
of the Property (unless specifically otherwise allocated herein), shall all be
prorated between the parties on the calendar year as of the closing date. Any
income from rentals due but not paid as of closing date shall be forwarded to
Seller if actually collected and received by buyer subsequent to the closing
date; however, the parties agree that from and after the closing date, any
monies received from any tenant shall be allocated first towards rental then
currently due from such tenant, prior to allocation of past rentals due and
owing from such tenant to Seller;
(ix) all bills for services, labor, materials, capital
improvements or other charges of any kind or nature rendered to Seller or the
Property prior to the closing date shall be borne by and paid by Seller;
(x) all tenant security deposits and any prepaid rent received by
Seller for periods after the closing date shall be credited or paid to Buyer and
charged to Seller and Buyer shall receive as a credit any accrued but unpaid
interest on the Mortgage and a credit for the broker's fee of $410,000.00 as
referenced in Section XIV hereof;
(xi) all such proration of revenues and expenses shall be
adjusted to the extent known on the closing date. Any such items unknown as of
the closing date shall be adjusted after the closing date when such items become
known; and
(xii) prepare closing statements for Seller and Buyer,
respectively, indicating deposits, credits and charges (including allocation of
current real property taxes) and deliver the same, together with a disbursement
of funds, to any appropriate party;
Any supplemental closing instructions given by any party shall also be followed
by the Title Company provided the same do not conflict with any instructions set
forth herein.
SECTION XI.
DEFAULT BY BUYER
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In the event the transactions contemplated hereby fail to close as a result
of a material default by buyer of any of the terms of this Agreement, and such
failure to close continues for a period of ten (10) days after Seller notifies
Buyer of such event, Seller's sole and exclusive remedy for such default shall
be the right to cancel and terminate this Agreement as provided for by law.
Except for the provision of Section III, upon such termination each party shall
be released from all duties and obligations contained herein, it being
understood and agreed that Seller is hereby releasing and/or waiving any right
it might have to either specifically enforce this Agreement or xxx for damages.
SECTION XII.
DEFAULT BY SELLER
If Seller refuses to perform any of its obligations as set forth herein and
such failure to perform continues for a period of ten (10) days after Buyer
notifies Seller of such event, Buyer may, at its option, elect one of the
following remedies:
(a) To terminate this Agreement by notice to Seller, in which event,
except for the provision of Section III, neither party shall have any further
rights or obligations hereunder; or
(b) to enforce specific performance of Seller's obligations hereunder,
including specifically the conveyance of the Property in the condition required
hereby.
SECTION XIII.
EXPENSE OF ENFORCEMENT
If either party brings an action at law or in equity to enforce or
interpret this Agreement, the prevailing party in such action shall be entitled
to recover reasonable attorney's fees and court costs in addition to any other
remedy granted.
SECTION XIV.
BROKERS
Seller warrants to Buyer that except for a brokerage commission due to the
Buyer in the amount of $410,000.00, and a commission equal to three percent (3%)
of the Purchase Price due to Wellington Realty, Inc. which Seller agrees to pay
at the closing, Seller has not taken any action which would result in any real
estate broker's fee being due or payable to any party in connection with this
transaction. Buyer warrants to Seller that except for the foregoing fee, Buyer
has not taken any action which would result in any real estate broker's fee,
finder's fee or other fee being due or payable to any party in connection with
this transaction. Except for the foregoing commission payable to Buyer, Seller
and Buyer respectively agree to indemnify, defend and hold harmless the other
from and against any and all other claims, fees, commissions and suits of any
real estate broker or agent with respect to
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services claimed to have been rendered for or on behalf of such party in
connection with the execution of this Agreement or the transaction set forth
herein.
SECTION XV.
NOTICE
All notices, demands and requests required or permitted to be given under
this Agreement must be in writing and shall be deemed to have been properly
given or served either by personal delivery or by depositing the same in the
United States Mail, addressed to Seller or to Buyer, as the case may be, prepaid
and registered or certified mail, return receipt requested, at the following
addresses:
TO SELLER: Maple Grove Apartment Home, Inc.
00000 X. Xxxxxxxxx Xxxxx, #000
Xxxxxxxxxx, XX 00000
Attn: Xxxxxx X. Xxxx
WITH COPY TO: __________________________________
__________________________________
__________________________________
Attn:_____________________________
TO BUYER: The Shelard Group, Inc.
c/o Century Bank, N.A.
00000 Xxxxxx Xxxxx, Xxxxx 000
Xxxx Xxxxxxx, Xxxxxxxxx 00000
Attn: Xxxxxxx X. Xxxx
WITH COPY TO: Maun & Simon, PLC
0000 Xxxxxxx Xxxxx Xxxxxxxx Xxxx
000 Xxxxxxxx Xxxx
Xxxxxxxxxxx, Xxxxxxxxx 00000
Attn: Xxxxxxx Bans
Rejection or refusal to accept or the inability to deliver notice hereunder
because of changed address of which no notice was given shall be deemed to be
receipt of the notice, demand or request. Any party shall have the right from
time to time and at any time upon the last ten (10) days' written notice
thereof, to change their respective addresses, and each shall have the right to
specify as its address any other address within the United States of America.
SECTION XVI.
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CONDEMNATION
In the event any portion of the Property is condemned or access thereto
shall be taken, or in either case threatened, prior to the closing, and Buyer
concludes that the taking renders the land remaining unsuitable for the Current
Uses contemplated and Buyer notifies Seller in writing of such conclusion within
thirty (30) days after written notice to Buyer of such condemnation action, then
this Agreement shall terminate.
If the Agreement is not terminated pursuant to the preceding sentence, the
Purchase Price of the Property shall not be affected, it being agreed that if
the award is paid prior to the closing of this transaction, such amount, insofar
as it pertains to the Property, shall be held in escrow and delivered to Buyer
at the time of closing; and if the award has not been paid prior to the closing
of this transaction, then at the closing Seller shall assign to Buyer all of its
right, title and interest with respect to such award and shall further execute
any other instrument requested by Buyer to assure that such award is paid to
Buyer.
If Buyer does not terminate this Agreement, it shall have the right to
contest the condemnation and/or the award resulting therefrom.
SECTION XVII.
DAMAGE OCCURRING PRIOR TO CLOSING
If, prior to the closing date, all or any part of the Property is
substantially damaged by fire, casualty, the elements or any other cause, Seller
shall immediately give notice to Buyer of such fact and at Buyer's option (to be
exercised with ten (10) days after Seller's notice), this Agreement shall
terminate, in which event neither party will have any further obligations under
this Agreement. If Buyer fails to elect to terminate despite such damage, Seller
shall promptly commence to repair such damage or destruction to mitigate further
damages. If such damage shall be completely repaired prior to the closing date,
then there shall be no reduction in the Purchase Price and Seller shall retain
the proceeds of all insurance related to such damage. If such damage shall not
be completely repaired prior to the closing date, Seller shall assign to Buyer
all right to receive the proceeds of all insurance related to such damage, less
costs incurred by Seller in mitigating damage or making repairs that are
reimbursable by insurance then in force, and the Purchase Price shall remain the
same. For purposes of this Section, the words "substantially damaged" mean
damage that would cost $50,000.00 or more to repair.
SECTION XVIII.
EMPLOYEE MATTERS
This Agreement does not include and there shall not be assigned to or
assumed by Buyer, by any provision of this Agreement nor by any other Agreement
between Seller and Buyer, any obligations of Seller under labor agreements,
pension plans, health and welfare plans, group insurance plans, tax, worker's or
employer's compensation, contribution of
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funding requirements and other contracts of commitment of Seller to its
employees or former employees, whether with respect to the Property, its
improvements thereon or otherwise. Buyer hereby does not agree to, and this
Agreement shall not obligate Buyer to continue the employment of any employees
or former employees of Seller. Seller shall indemnify and hold Buyer harmless
from any loss, damage, claim or liability to employees and former employees of
Seller of Seller arising from their employment by Seller, and termination of
said employment by Seller with respect to the Property, its improvements thereon
or otherwise.
SECTION XIX.
CONTINUATION OF BUSINESS
Seller hereby agrees that during the period between the execution of this
Agreement and the closing date it will continue to actively and aggressively
retain existing tenants, enforce all leases and seek tenants for vacant space,
in accordance with their past business practices.
SECTION XX.
MERGER/BINDING AGREEMENT
All previous negotiations and understandings between Seller and Buyer or
their respective agents and employees with respect to the transaction set forth
herein are merged in this Agreement which alone fully and completely expresses
the parties' rights, duties and obligations. This Agreement shall be binding
upon and inure to the benefit of the parties hereto and their respective
successors, assigns, heirs and personal representatives, it being understood and
agreed that the warranties, representations and/or indemnities and hold harmless
agreements made and expressed herein shall survive the closing of this
transaction and shall not be merged therein.
SECTION XXI.
EFFECTIVE DATE
The Effective Date of this Agreement shall be the date of the last party's
execution; provided, however, that if the last party does not execute this
Agreement and deliver a duly executed counterpart of the same to the first
signing party within ten (10) days of the first party's execution date, then the
offer or commitment to be bound hereby by the first executing party shall
automatically be revoked and withdrawn, whereupon neither party shall be bound
hereto.
SECTION XXII.
GOVERNING LAW
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This Agreement shall be deemed to be a contract made under the laws of the
State of Wisconsin and for all purposes shall be governed and construed in
accordance with the laws of said State.
SECTION XXIII.
ASSIGNMENT
Buyer may assign effective at closing its rights under this Purchase
Agreement, provided it gives Seller notice of such assignment.
IN WITNESS WHEREOF, the parties hereto have executed these presents
intending to be bound by the provisions herein contained.
SELLER: BUYER:
MAPLE GROVE APARTMENT HOME, INC. THE SHELARD GROUP, INC.
By:/s/ By:/s/
----------------------------- ----------------------------------
Its:____________________________ Its:______________________________
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EXHIBIT A
LEGAL DESCRIPTION
Units One (1), Two (2), Three (3), Four (4), Five (5), Six (6), Seven (7),
Eight (8), Nine (9), Ten (10), Eleven (11), Twelve (12), Thirteen (13), and
Fourteen (14), Maple Grove Apartment Homes, a Condominium, in the City of
Madison, Dane County, Wisconsin.
Being a part of Xxx 000, Xxxxx Xxxxx First Addition, recorded in Volume
56-68B of Plats on pages 201-202, Dane County Registry, and Xxx 000, Xxxxx Xxxxx
Second Addition, recorded in Volume 56-100A of Plats on page 291, Dane County
Registry, located in the Southeast 1/4 of the Southwest 1/4 of Section 1, Town 6
North, Range 8 East, in the City of Madison, Dane County, Wisconsin, to-wit:
Commencing at the South 1/4 corner of said Section 1, thence North 00 degrees
30' 36" East, 60.01 feet to the point of beginning; thence South 89 degrees 27'
19" West, 469.82 feet; thence North 00 degrees 32' 41" West, 188.66 feet; thence
North 89 degrees 26' 47" West, 230.22 feet to the start of a curve; thence
Northwesterly on a curve to the left which has a radius of 183.00 feet and a
chord which bears North 30 degrees 23' 03" West, 182.11 feet; thence North 60
degrees 13' 25" West, 100.00 feet to a point of curve; thence Northwesterly on a
curve to the right which has a radius of 117.00 feet and a chord which bears
North 29 degrees 50' 06" West, 118.37 feet; thence North 00 degrees 33' 13" East
245.86 feet; thence South 89 degrees 26' 47" East 186.93 feet, thence North 80
degrees 26' 25" East, 110.04 feet; thence North 67 degrees 18' 45" East; 102.57
feet; thence North 54 degrees 38' 53" East 102.57 feet; thence North 43 degrees
53' 58" East, 71.62 feet; thence North 39 degrees 28' 58" East, 139.54 feet;
thence North 44 degrees 52' 12" West, 17.15 feet; thence North 46 degrees 29'
30" West, 108.20 feet; thence North 39 degrees 28' 58" East, 30.07 feet; thence
South 46 degrees 29' 30" East, 110.31 feet to a point of curve; thence
Southeasterly on a curve to the right which has a radius of 333.00 feet and a
chord which bears South 22 degrees 59' 27" East 265.58 feet; thence South 00
degrees 30' 36" West, 358.90 feet; thence South 89 degrees 29' 24" East, 220.00
feet; thence South 00 degrees 30' 36" West, 444.99 feet to the point of
beginning.
EXHIBIT B
PERMITTED ENCUMBRANCES
1. Leases
EXHIBIT C
INDEMNIFICATION AGREEMENT
This Agreement entered into this ____ day of ___________, 1999 by and
between Maple Grove Apartment Home, Inc. (hereinafter referred to as the
"Seller") and _______________________, (the "Buyer").
RECITALS:
1. Seller, simultaneously with the execution of this Indemnification
Agreement, has sold to Buyer pursuant to a Purchase Agreement dated
______________________, 1999 ("Purchase Agreement") a parcel of land ("Land")
located in Dane County, State of Wisconsin, legally described as ______________
______________________________________________________.
2. The Land is improved with ______________________ (_________) residential
apartment buildings contained in the aggregate three hundred four (304)
residential apartment units ("Improvements").
3. The property purchased by Buyer from Seller includes not only the Land
and the Improvements, but also all licenses, permits, equipment, fixtures and
furnishings and certain other personal property, tangible and intangible, owned
by the Seller and used in the operation and maintenance of the Improvements
(hereafter said licenses, permits, equipment, fixtures, furnishings and other
personal property, together with the Land and the Improvements, shall be
referred to in the aggregate as the "Property").
4. Pursuant to the Purchase Agreement, the parties have agreed to execute
this Indemnification Agreement relating to the Property.
NOW, THEREFORE, in consideration of the foregoing and of the terms and
conditions hereafter set forth, the parties agree as follows:
1. All risks, losses and liabilities incurred or accruing through the
ownership or operation of the Property on or before the date hereof, shall be
borne by Seller, including without limitation all liabilities which are
presently unknown, undetermined or the subject of court litigation.
2. All risks, losses and liabilities arising from ownership or operation of
the Property subsequent to the date hereof shall be borne by Buyer.
3. Seller hereby agrees to indemnify and hold Buyer harmless from all
claims, liabilities, costs, expenses and attorneys' fees which accrue through
the ownership or operation of the Property on or before the date hereof,
including, but not
limited to, all claims or liabilities arising out of Leases (as defined in the
Purchase Agreement) or the Other Agreements (as defined in the Purchase
Agreement).
4. Seller further agrees to defend, indemnify and hold harmless Buyer from
any and all liabilities (including but not limited to attorneys' fees), claims,
demands, actions, causes of action, in law or in equity, whether past, present
or future, known or unknown, liquidated or unliquidated, whether in tort,
contract, statutory cause of action or administrative agency proceeding or
otherwise, whether for personal injury, property damage, clean-up, remedial or
response costs, wrongful death, or loss of consortium or support which arise out
of or in any way relate to activities ("Activities") which Seller had conducted
on the Property.
5. Seller agrees to indemnify and hold Buyer harmless from all claims,
expenses and liabilities (including reasonable attorneys' fees) incurred by
Buyer as a result of Seller's breach of any of the warranties contained in the
Purchase Agreement.
6. Buyer hereby agrees to indemnify and hold Seller harmless from all
claims, liabilities, costs and expenses and attorneys' fees which accrue through
the ownership or operation of the Property after the date hereof, including, but
not limited to, claims or liabilities and expenses arising out of Leases (as
defined in the Purchase Agreement) and the Other Agreements which accrue after
the date hereof and including all liabilities (including but not limited to
attorneys' fees), claims, demands, actions, causes of action, in law or in
equity, whether past, present or future, known or unknown, liquidated or
unliquidated, whether in tort, contract, statutory cause of action or
administrative agency proceeding or otherwise, whether for personal injury,
property damage, clean-up, remedial or responses costs, wrongful death, or loss
of consortium or support which arise out of or in any way relate to activities
("Activities") which Buyer has conducted on the Property.
7. Nothing in this Agreement shall be deemed to supersede or abrogate any
terms of conditions of the Purchase Agreement, but rather the terms and
conditions of this Agreement shall be deemed to supplement the terms and
conditions of the Purchase Agreement.
8. This Agreement shall be construed according to the laws of the State of
Minnesota and shall be binding upon and inure to the benefit of the parties
hereto and their successors and assigns.
SELLER: BUYER:
MAPLE GROVE APARTMENT HOME, INC. THE SHELARD GROUP, INC.
By:/s/ By:/s/
----------------------------- ----------------------------------
Its:____________________________ Its:_________________________________
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