AGREEMENT TO ASSIGN OPTION AGREEMENT
AND
OPTION AGREEMENT
THIS AGREEMENT TO ASSIGN OPTION AGREEMENT AND OPTION AGREEMENT
("Agreement") is made and entered into this 11th day of November, 2003
("Effective Date"), by and between Buffalo Highlands, LLC, a Colorado limited
liability company, as grantor ("Buffalo Highlands"), and MELODY HOMES, INC., a
Delaware corporation ("Melody") as grantee. Buffalo Highlands and Melody are
sometimes referred to herein individually as "Party" and collectively as
"Parties".
RECITALS
A. Pursuant to that certain Option Agreement To Purchase Real Estate (the
"B.I. Option Agreement"), dated April 4, 2001 by and between Broncucia
Investment, a Colorado General Partnership, as seller ("B.I.") and Buffalo
Highlands (assignee of Hastings Holding Corporation) as buyer and as amended by
the Amendment to Option Agreement to Purchase Real Estate dated July 20, 2001,
that Second Amendment dated August 29, 2002, and that Third Amendment dated
November 13, 2003, Buffalo Highlands owns an option to purchase a certain parcel
of real property described as the West one-half of Section 21, Township 2 South,
Range 66 West of the 6th Principal Meridian, in Commerce City (the "City"),
Xxxxx County, Colorado ("B.I. Property").
B. Melody desires to obtain title to approximately 600 or more lots to be
subdivided on that portion of the B.I. Property located easterly of the easterly
border of the flood plain for Second Creek, as generally depicted on Exhibit A,
attached hereto and made a part hereof ("Land"), together with certain rights
related to Land. The Parties intend that Buffalo Highlands will ultimately own
that portion of the B.I. Property located westerly of the easterly border of the
flood plain for Second Creek ("Retained Parcel").
C. The Parties contemplate that Buffalo Highlands will assign the B.I.
Option Agreement to Melody, and that Melody will exercise the option with
respect to a portion of the Land, and at or immediately before such time as
Melody exercises the option, Melody will re-assign the B.I. Option Agreement to
Buffalo Highlands with respect to all of the B.I. Property except that portion
of the Land to be purchased by Melody directly from B.I., and described herein.
The Parties contemplate that Melody will then have an option to purchase the
remaining portions of the Land from Buffalo Highlands at two separate closings
subsequent to re-assignment of the B.I. Option Agreement to Buffalo Highlands
and Buffalo Highlands' subsequent purchase of the remaining portions of the
Land.
D. Buffalo Highlands desires to assign and Melody desires to assume the
B.I. Option Agreement, subject to Melody's agreement to re-assign the B.I.
Option Agreement to Buffalo Highlands simultaneously with Melody's purchase of a
portion of the Land, which portion shall be determined in accordance with the
terms of this Agreement
E. Buffalo Highlands desires to grant and Melody desires to receive an
option to purchase the remainder of the Land from Buffalo Highlands subsequent
to Buffalo Highlands' exercise of the option under the B.I. Option Agreement,
after re-assignment of thereof from Melody to Buffalo Highlands, and Buffalo
Highlands' purchase of the remaining B.I. Property from B.I.
F. The Parties anticipate that the Land will be subdivided into
approximately Six Hundred (600) or more single-family detached and/or attached
residential lots ("Lots"). The Parties acknowledge the total number of Lots set
forth above is only an estimate, the total number of Lots actually approved by
the City may be greater or fewer. The Parties also acknowledge that as of the
Effective Date, Buffalo Highlands and Melody are in discussions with the City
regarding the relocation of park sites within the B.I. Property ("Park Site
Relocation"), which relocation may increase the total number of Lots or
residential units which may be constructed on the Land. In the event that the
City approves the Park Site Relocation, then the total number of Lots on the
Land may increase.
AGREEMENT
NOW, THEREFORE, in consideration of the mutual promises and covenants set
forth herein, the Parties agree as follows:
1. Agreement to Assign and Grant of Option to Purchase. Buffalo Highlands
hereby: (a) agrees to assign and sell to Melody, and Melody agrees to purchase
and receive, all of Buffalo Highlands' rights and obligations under the B.I.
Option Agreement on the terms and conditions set forth herein ("Assignment");
and (b) grants to Melody an option to purchase that portion of the Land
containing the Second Closing Lots and Remaining Lots, as defined herein below
("Option"), subject to Buffalo Highlands' obtaining title to the Second Closing
Lots and Remaining Lots. The "First Closing Lots" shall consist of at least
forty percent (40%) of the total number of approved Lots within the Land,
currently estimated at no less than Two Hundred Fifty (250) Lots ("First Closing
Lots"). The "Second Closing Lots" shall consist of thirty percent (30%) of the
total number of approved Lots within the Land, currently estimated at One
Hundred Seventy-Five (175) Lots ("Second Closing Lots"). The "Remaining Lots"
shall consist of the remainder of approved Lots within the Land ("Remaining
Lots"). Notwithstanding the foregoing to the contrary, in the event that the
City approves the Park Site Relocation, then the First Closing Lots, Second
Closing Lots, and Remaining Lots shall each consist of one-third of the total
number of approved Lots within the Land. The exact configuration and location of
the First Closing Lots shall be agreed upon and approved by Melody and Buffalo
Highlands prior to Melody's exercise of the option under the B.I. Option
Agreement, and the exact configuration and location of the Second Closing Lots
shall be agreed upon and approved by Melody and Buffalo Highlands as a condition
precedent to Melody's exercising its Option, which approval shall not be
unreasonably withheld or delayed. In determining said configuration and
location, the Parties shall take into consideration, without limitation,
Melody's phasing, marketing and sales plans, and Buffalo Highlands' ability to
develop and sell the remaining Lots in the event that Melody does not
subsequently purchase the same.
2. B.I. Option Agreement. From and after the Effective Date, Buffalo Highlands
and Melody shall maintain the B.I. Option Agreement in full force and effect,
and shall not cause or allow any amendments to, modifications of or defaults
under the B.I. Option Agreement without the other Party's prior written consent,
which consent shall not be unreasonably withheld or delayed. Within two (2) days
after the Effective Date, Buffalo Highlands shall deliver to Melody a Consent to
Assignment ("Consent") executed by B.I., in form and substance of Exhibit B,
attached hereto and incorporated herein.
a. Rights With Respect to Retained Parcel. Notwithstanding anything in this
Agreement to the contrary, and notwithstanding the assignment of the B.I. Option
Agreement to Melody, Melody hereby consents to Buffalo Highlands entering into
any agreements with third parties with respect to the use or development of the
Retained Parcel, provided that any such agreement shall not materially and
adversely affect Melody's development or use of the Land. Melody shall execute
all documents and take all further actions reasonably requested by Buffalo
Highlands to evidence said consent.
3. Consideration for Assignment and Option. In consideration of the Assignment
and the grant of the Option, Melody shall pay to the Title Company, as defined
herein, semi-annual payments, in good funds, in the amount of Two Hundred
Thirty-Four Thousand Dollars ($234,000) (individually, "Option Payment" and
collectively, "Option Payments"), and the Title Company shall hold the Option
Payments in escrow on behalf of Buffalo Highlands and Melody in accordance with
the terms of this Agreement and in accordance with an escrow agreement to be
agreed upon by the Parties on or prior to the expiration of the Inspection
Period ("Option Escrow Agreement"). The first Option Payment shall be paid to
the Title Company within Five (5) days after the expiration of the Inspection
Period, as defined herein, and the additional Option Payments shall be due and
paid every six (6) months thereafter until exercise of the Option as provided
herein below or until termination of this Agreement in accordance with the terms
hereof. In the event that Melody fails to make an Option Payment when due,
Buffalo Highlands shall give Melody written notice of said failure, and if
Melody does not cure such failure by making the Option Payment within ten (10)
days after receipt of such notice, then this Agreement and the Option shall
terminate. Provided that Buffalo Highlands is not in default, at the time of
such termination, under (i) this Agreement, (ii) the B.I. Option Agreement; or
(iii) the FRICO Agreement, as defined in paragraph 9(f) below, Buffalo Highlands
shall be entitled to receive from the Title Company any Option Payments made,
and neither of the Parties shall have any further rights or obligations under
this Agreement, except those which expressly survive termination. A portion of
the Option Payments made shall be disbursed by the Title Company to B.I. as the
option payments required under the B.I. Option Agreement in accordance with the
Option Escrow Agreement. The remaining Option Payments made to the Title Company
shall be released to Buffalo Highlands at the First Closing, and shall be
applied to the Purchase Price at each of the Closings, as defined herein below,
as follows: 40% to be applied at the First Closing, 30% to be applied at the
Second Closing, and 30% to be applied at the Final Closing. Buffalo Highlands'
obligation to credit such Option Payments at the Second and Third Closings shall
be secured by the Deed of Trust as defined in Paragraph 13(a) below.
Notwithstanding the foregoing to the contrary, in the event the City approves
the Park Site Relocation, then one-third of the Option Payments shall be applied
to the Purchase Price at each of the Closings.
a. Assignment. Simultaneously with the payment of the first Option Payment
by Melody, Buffalo Highlands shall execute and deliver to Melody an assignment
of the B.I. Option Agreement, in form and substance to be agreed upon by the
Parties during the Inspection Period ("Assignment Form"). Upon or prior to
exercise by Melody of the option under the B.I. Option Agreement, Melody shall
assign to Buffalo Highlands the B.I. Option Agreement, except as it relates to
the First Closing Lots, by an assignment agreement substantially in the form of
the Assignment Form. Simultaneously with the delivery of the first Option
Payment, Melody shall deliver to the Title Company to be held in escrow an
assignment, in the form of the Assignment Form, executed by Melody, assigning
the B.I. Option Agreement to Buffalo Highlands ("Melody Assignment"). In the
event Melody defaults under this Agreement or the B.I. Option Agreement, and
fails to cure any such default within any applicable cure period, then the
Melody Assignment shall be released to Buffalo Highlands in accordance with the
terms of the Option Escrow Agreement.
4. Term and Exercise of Option. Unless this Agreement is sooner terminated, the
"Option Term" shall be a period of time commencing on the payment by Melody of
the First Option Payment and expiring at 5:00 p.m. Denver time on December 10,
2004, subject to extension as provided herein. At any time during the Option
Term, unless Melody is in material default under this Agreement, Melody may
exercise the Option by exercising its option under the B.I. Option Agreement, as
assigned to Melody, and delivering written notice of exercise to Buffalo
Highlands in accordance with Paragraph 14(a). Notwithstanding anything in this
Agreement to the contrary, in no event shall Melody exercise the Option prior to
the date on which Buffalo Highlands acquires title to the Second Closing Lots
and Remaining Lots. After assignment of the B.I. Option Agreement to Melody,
Melody shall not exercise the option under the B.I. Option Agreement without
first giving Buffalo Highlands 15 days prior written notice of its intent to so
exercise.
a. Conditions Precedent. The following shall be conditions precedent to
Buffalo Highlands' obligation to convey the Second Closing Lots and Remaining
Lots to Melody: (i) Melody has assigned to Buffalo Highlands the B.I. Option
Agreement as it applies to all of the B.I. Property except the First Closing
Lots; and (ii) Melody has purchased the First Closing Lots from B.I. and paid
the balance of the purchase price under this Agreement into escrow, which funds,
as a condition of the Closing for the First Closing Lots shall be applied by the
Closing Agent, on behalf of Buffalo Highlands, to the purchase price and closing
on the remainder of the B.I. Property (all the B.I. Property, less the First
Closing Lots), and Buffalo Highlands has obtained title to the Second Closing
Lots and Remaining Lots.
b. Extension Period - ERU's and City Approvals. In the event that a number
of ERU's, as defined in Paragraph 9(f), equal to the number of Lots and
Landscaping ERU's, as defined herein below, are not available for purchase under
the FRICO Agreement, as defined in Paragraph 9(f), on the expiration of the
Option Term, or the City has not granted final approval of a final plat and
engineering plans for the First Closing Lots on or before the expiration of
Option Term, as extended (if applicable), Melody may extend the Option Term for
up to four (4) successive six (6) month extensions by delivery of written notice
of extension ("Notice of Extension") to B. I. and Buffalo Highlands on or before
the expiration of the Option Period, as extended, or expiration of the
applicable six month extension, as applicable, together with a $234,000
additional Option Payment, paid in accordance with the Option Escrow Agreement,
for each six month extension, in which event the Option Term shall be extended
for the six month period. If exercised, the final of the four extensions shall
extend the Option Period to December 31, 2006. The Parties acknowledge that
pursuant to Paragraph 2.5 of the FRICO Agreement, the right to purchase ERU's
under the FRICO Agreement may terminate if certain conditions are not satisfied
on or before January 1, 2007, unless the Parties to the FRICO Agreement mutually
agree to extend it. If the FRICO Agreement is extended pursuant to the terms of
the FRICO Agreement, then Melody shall be entitled to four (4) additional six
(6) month extensions of the Option Term under the terms and conditions of this
Paragraph 4(b). Notwithstanding anything in this Agreement to the contrary, the
Option Term may not be extended beyond December 31, 2008 ("Outside Date"). All
payments made pursuant to this Paragraph 4(b) shall be additional Option
Payments, shall be held by the Title Company in accordance with the Option
Escrow Agreement, and shall be applied to the Purchase Price, as defined herein
below, in accordance with Paragraph 3 hereof.
c. Return of Option Payments. In the event that Melody has extended the
Option Term pursuant to Paragraph 4(b) above, and Melody has not exercised the
Option on or before the Outside Date and either (i) a number of ERU's equal to
the number of Lots anticipated by the Parties to be purchased by Melody are not
available for purchase under the FRICO Agreement on or before the Outside Date
or any alternative source, if said alternative source is acquired (at no cost to
Melody), or (ii) the City has not granted final approval of a final plat and
engineering plans for the First Closing Lots on or before the Outside Date, then
this Agreement shall automatically terminate, in which event Melody shall be
entitled to return of all Option Payments made by Melody. After such
termination, neither Party shall have any further rights or obligations under
this Agreement, except those obligations, which expressly survive termination.
5. Purchase Price. The total purchase price to be paid by Melody shall be based
upon the number of Lots that are finally platted, engineered and approved for
the Land, or proposed for the Land as shown on the Current Plan (defined below),
at the time of exercise of the Option, at the price of Nineteen Thousand Five
Hundred Dollars ($19,500) per Lot ("Total Purchase Price"), subject to
adjustment as provided in this Agreement and subject to the Purchase Price
Escalator, as defined below. Since Melody will be closing on the purchase of the
First Closing Lots directly with B.I., a portion of said Total Purchase Price
will be paid by Melody directly to B.I. at the First Closing as a portion of the
purchase price under the B.I. Option Agreement ("Melody's Portion of B.I.
Price"). The remainder of the Total Purchase Price, as reduced by the Melody's
Portion of B.I. Price, shall be paid by Melody to Buffalo Highlands ("Purchase
Price") at the First, Second and Final Closings as defined herein below, subject
to closing adjustments and prorations as provided herein below. The Purchase
Price shall be paid at each of the First, Second and Final Closings, based on an
amount equal to Nineteen Thousand Five Hundred Dollars ($19,500) multiplied by
the number of Lots to be purchased at each Closing, subject to adjustment and
proration as provided herein. The portions of the Purchase Price to be paid at
the Second and Final Closings shall increase at a rate of 7% per annum,
compounded annually, from the date of the First Closing (the "Purchase Price
Escalator"). Melody's Portion of the B.I. Price shall be equal to the total
number of acres to be purchased by Melody at the First Closing, multiplied by
Fifteen Thousand Six Hundred Twenty-Five Dollars ($15,625). The Parties
acknowledge that Buffalo Highlands has made and Melody and Buffalo Highlands may
have made (as of the date of the First Closing) certain option payments, xxxxxxx
money payments and other payments to B.I. or other parties under or contemplated
by the B.I. Option Agreement, and that Buffalo Highlands, and not Melody, shall
be entitled to all credits under the B.I. Option Agreement for all such payments
by Buffalo Highlands, and that Melody, and not Buffalo Highlands, shall be
entitled to all credits under the B.I. Option Agreement for all such payments by
Melody.
a. Lot Count and Purchase Price Adjustment. Melody shall use best efforts
to seek approval by the City of at least 600 Lots for the Land. In the event
that a final plat for the Land has not been approved when Melody exercises the
Option, or the option under the B.I. Option Agreement, then the Purchase Price
shall be based on the number of Lots shown on the development plan for the Land
that is current as of the time of Melody's exercise ("Current Plan").
Notwithstanding the foregoing to the contrary, if all of the Lots are purchased
by Melody, then in no event shall the Total Purchase Price be less than Eleven
Million Five Hundred Five Thousand Dollars ($11,505,000) ("Minimum Total
Purchase Price") nor exceed Thirteen Million Sixty-Five Thousand Dollars
($13,065,000) ("Maximum Total Purchase Price"). Furthermore, in no event shall
the Purchase Price at any Closing, except the Final Closing, exceed forty
percent (40%) of the Maximum Total Purchase Price, excluding the Purchase Price
Escalator.
b. Park Site Relocation; Purchase Price Adjustments; and Park Fee Credits.
In the event that the City approves the Park Site Relocation, then the Purchase
Price which shall be the Maximum Purchase Price shall be paid one-third at each
of the First, Second, and Final Closings, subject to adjustments and prorations
as provided herein, and subject to the Purchase Price Escalator described in
Paragraph 5 above. As a result of the Park Site Relocation described above,
Buffalo Highlands, as ultimate owner of the Retained Parcel, will be entitled to
certain park fee credits from the City. In the event that the City approves the
Park Site Relocation, then at each Closing, Buffalo Highlands shall assign to
Melody all of its rights to all park fee credits to which Buffalo Highlands is
entitled for the applicable to the Lots to be purchased at that Closing, up to a
total number of park credits equal to the total number of approved Lots. As
consideration for such assignment, Melody shall pay to Buffalo Highlands, at the
time Melody would have been required by the City to pay the park fees, an amount
equal to the then-current park fee for each Lot ("Park Payment"). Melody's
obligation to pay such fees to Buffalo Highlands shall survive the Closings, and
shall be recited in Park Fee Memorandum(a) to be agreed upon by the Parties
prior to expiration of the Inspection Period, which Park Fee Memorandum(a) shall
be recorded at each of the Closings. Buffalo Highlands shall execute and deliver
to Melody a termination of Park Fee Memorandum, in recordable form, which shall
release therefrom each Lot for which Melody has paid to Buffalo Highlands the
Park Payment.
6. Title Commitment and Survey.
a. Title Commitment and Policy.
Within ten (10) days after the Effective Date, Buffalo Highlands shall
cause Chicago Title Insurance Company ("Title Company") to issue to Melody a
commitment (the "Title Commitment") to issue, promptly after Closing, an ALTA
Extended Owner's Title Policy insuring fee simple title to the Land in the
amount of the Total Purchase Price ("Title Policy"), and Buffalo Highlands shall
deliver to Melody copies of all unrecorded leases, agreements, and other
documents that may affect title to the Land ("Unrecorded Documents"). The Title
Commitment shall be provided to Melody, together with legible copies of all
recorded documents listed therein, and shall commit to delete from the Title
Policy, at Buffalo Highlands' expense: (1) any mechanics' lien exception as to
any liens arising through Buffalo Highlands and B.I.; (2) any exception for
instruments recorded after the effective date of the Title Commitment and prior
to recording of the deed to Melody except matters which are accepted by Melody
pursuant to the terms of this Agreement; (3) any exception for unpaid taxes and
assessments except for the year of closing and subsequent years; (4) any general
exception for leases and tenancies, except as to leases and tenancies which
Melody accepts or is deemed to have accepted pursuant to the terms of this
Agreement; (5) any facts, rights, interests or claims which are not shown by the
public records but which could be ascertained by an inspection of the land or by
making inquiry of persons in possession thereof; (6) easements, or claims of
easements, not shown by public record; and (7) discrepancies, conflicts in
boundary lines, shortage in area, encroachments, and any facts which a correct
survey and inspection of the land would disclose, and which are not shown by the
public records. Any endorsements requested by Melody with respect to such Title
Commitment shall be at Melody's sole expense, provided, however, that Buffalo
Highlands hereby agrees, to the extent requested by Melody, to pay up to the
first $1,000 of the total premium for both endorsements 100.31 and 103.1 with
respect to any severed mineral interests and rights of ingress and egress of
mineral owners, subject to the Title Company's willingness to issue said
endorsements under commercially reasonable requirements. Buffalo Highlands shall
cause the payment of the premium for the Title Policy in the amount of the Total
Purchase Price.
b. Survey. Within five (5) days after the Effective Date, Melody shall
order a new ALTA/ACSM survey ("Survey") of the B.I. Property, showing the Land
and the Retained Parcels, and also locating any easements thereon, describing
the extent to which the instruments described in Schedule B-2 of the Title
Commitment affect the Land, and in sufficient detail to obtain deletion of
standard printed exceptions as listed in items 1 - 7 above, and certified to
Melody, Buffalo Highlands, Title Company, and any other party reasonably
requested by Melody. The cost of such survey shall be initially borne by Melody,
but Melody shall be entitled to a credit for the cost of such survey at the
First Closing. In the event the First Closing does not occur for any reason
other than default by Buffalo Highlands, Melody shall be solely responsible for
the cost of the survey and shall not be entitled to any reimbursement for such
cost and Melody shall assign all of its rights in and to the Survey to Buffalo
Highlands for no additional consideration. Melody shall cause the surveyor to
deliver a copy of the Survey to Buffalo Highlands and the Title Company.
c. Title Defects and Objections. Within twenty (20) days after Melody's
receipt of both of the Title Commitment, with copies of the recorded documents
listed therein, and the Survey, but in no event after the expiration of the
Inspection Period, Melody shall give written notice to Buffalo Highlands
("Notice of Defect") of each title defect set forth therein which is
objectionable to Melody (a "Defect"). Melody's failure to give such Notice of
Defect shall be deemed its acceptance of the matters disclosed therein for which
objection is not given. If such Notice of Defect is given, Buffalo Highlands
shall, within ten (10) days of its receipt thereof, notify Melody in writing of
the Defects, if any, contained in Melody's Notice of Defect which Buffalo
Highlands agrees to cure or cause to be cured ("Buffalo Highlands' Response").
Buffalo Highlands shall have no obligation to cure or cause the cure of any
Defect. If Buffalo Highlands fails to timely provide Buffalo Highlands'
Response, Buffalo Highlands shall be deemed to have agreed to cure no such
Defects. If Buffalo Highlands does not agree to cure all such Defects contained
in Melody's Notice of Defect, then this Agreement shall terminate unless Melody
elects to continue this Agreement by written notice delivered to Buffalo
Highlands not later than the earlier of the date that is ten (10) days after
receipt of Buffalo Highlands' Response or after the date on which Buffalo
Highlands' Response would have been due; or the expiration of the Inspection
Period, in which event neither Party shall have any further rights or
obligations under this Agreement, except those which expressly survive
termination. If Melody gives such notice to continue, Melody's right to
terminate the Agreement or condition its exercise of the Option on the basis of
the Defects shall be waived and the title to the Land shall be subject to those
Defects which Buffalo Highlands has not agreed to cure and which are not
otherwise cured prior to Closing. The same procedure and time periods provided
herein shall be applicable to any new matter first appearing in any subsequent
title commitment or updated surveys, except that Melody shall have ten (10) days
after Melody's receipt of the document reflecting such matter within which to
provide the Notice of Defect with respect to said new matters. Notwithstanding
the foregoing to the contrary, Buffalo Highlands shall not cause any title
defects which materially and adversely affect Melody's intended use of the
Property or any monetary liens to become of record after the date of this
Agreement without Melody's prior written consent, which consent may be withheld
in Melody's sole and absolute discretion but which consent shall be deemed to
have been given if Melody does not deliver to Buffalo Highlands written notice
of consent or objection within five (5) days after receipt by Melody of written
request for consent from Buffalo Highlands.
7. Inspection of the Land.
a. Information. Within seven (7) days after the Effective Date, or, if not
in Buffalo Highlands' possession on the Effective Date, within five (5) days
after receipt of the same by Buffalo Highlands, Buffalo Highlands shall provide
to Melody copies of all engineering, studies, surveys, reports, and all other
material information regarding the Land, which are in Buffalo Highlands'
possession or control and which Buffalo Highlands has not already provided to
Melody; provided, however, all documents, information, and materials provided by
Buffalo Highlands to Melody relating to the Land shall be returned to Buffalo
Highlands upon any termination of this Agreement. Buffalo Highlands makes no
warranty that documents and information prepared by others are accurate or
complete, but Buffalo Highlands shall not conceal information or delete any
portion of such documents.
b. Inspection. Melody shall have until 5:00 p.m. Denver time on the
forty-fifth (45th) day after the Effective Date within which to inspect the Land
("Inspection Period"). Within two (2) days after the Effective Date, Buffalo
Highlands shall deliver to Melody the Consent, and Melody may inspect the Land
in accordance with the license granted in the Consent. If Melody determines
during the Inspection Period, in Melody's sole and absolute discretion, that the
Land is unsuitable for its purposes for any reason, Melody may elect to either
(i) terminate this Agreement by delivery of written notice to Buffalo Highlands
within the Inspection Period, in which event neither of the Parties shall have
any further rights or obligations under this Agreement, except those which
expressly survive termination; or (ii) waive the condition of this Paragraph by
delivery of written, unconditional notice of suitability and waiver to Buffalo
Highlands within the Inspection Period, in which event Melody shall be deemed to
accept the condition of the Land. Melody's failure to timely make the election
provided for in the preceding sentence shall be conclusively deemed an election
by Melody to proceed under Paragraph 7(b)(i). If the Land is altered or
disturbed in any manner in connection with any of Melody's activities, Melody
shall immediately return the Land to the condition existing prior to such
activities, to the extent reasonably possible. Melody shall promptly pay all
persons and entities employed in connection with Melody's activities related to
the Land and shall not permit any liens or other claims to be asserted against
the Land. Before entering upon the Land, Melody shall furnish to Buffalo
Highlands evidence of general liability insurance coverage (naming Buffalo
Highlands and B.I. as additional insureds) of not less than Two Million Dollars
($2,000,000.00). Melody agrees to indemnify, defend and hold Buffalo Highlands
and B.I. harmless from any mechanics' liens or other claim, loss, cost, damage
or expense resulting from actions or omissions of Melody or its consultants in
connection with the performance of such activities on the B.I. Property,
including reimbursing Buffalo Highlands and B.I. for their reasonable attorneys'
fees in connection with any such action, except to the extent of claims arising
from or connected with the acts or omissions of Buffalo Highlands and B.I.,
previously existing latent conditions or hazardous materials not placed on the
Property or exacerbated by Melody. Melody's indemnification obligation hereunder
shall survive the Closings or termination of this Agreement.
8. Closing. When and if Melody exercises the Option and the option under the
B.I. Option Agreement, the First, Second and Final Closings ("Closings"), shall
occur as follows, provided, however, that if any Closing falls on a Friday or
Monday, said Closing shall occur on the next business day which is not a Friday
or Monday. At the option of either Party, closing documents may be executed in
advance and deposited with the Title Company in escrow to avoid the necessity of
closing with all parties present:
a. First Closing. The Closing of the First Closing Lots ("First Closing")
shall occur at 11:00 a.m. on the date which is twenty (20) days after the date
of exercise of the Option, at the offices of the Title Company, or at such other
place as may be mutually agreed upon by the Parties, but in no event later than
January 26, 2005, unless extended pursuant to Paragraph 4 hereof. The closing of
the purchase of the First Closing Lots by Melody from B.I., the closing of the
assignment of the remainder of the B.I. Option Agreement, and the closing
purchase of the remainder of the B.I. Property by Buffalo Highlands from B.I.
shall occur simultaneously.
b. First Closing Items. The following shall occur at the First Closing,
each item being a condition precedent to the others and all being considered as
occurring simultaneously:
(i) Melody shall reimburse Buffalo Highlands for an amount equal to
Buffalo Highlands' actual costs incurred in obtaining the traffic study for
the Land if the City does not require Melody to submit a new traffic study
and for the soils report for the Land, which amount shall not exceed
$20,500.
(ii) At or prior to the First Closing, the Parties shall deliver the
assignment agreement in form and substance of the Assignment Form, by which
Melody shall assign the remainder of B.I. Option Agreement to Buffalo
Highlands;
(iii) Melody shall pay to B.I. Melody's Portion of B.I. Price and
shall pay to Buffalo Highlands the difference between Melody's Portion of
B.I. Price and the Purchase Price for the First Closing Lots, with a credit
for the applicable portion of the Option Payments made to Buffalo Highlands
and for the Survey pursuant to Paragraph 6(b);
(iv) Melody shall pay to Buffalo Highlands, if applicable, an amount
equal to Melody's Share of payments made by Buffalo Highlands in accordance
with Paragraph 9(f)(i);
(v) Melody and Buffalo Highlands shall execute and deliver the ERU
Assignment and Assumption Agreement for the First Closing Lots, as defined
herein below;
(vi) Buffalo Highlands and Melody shall execute and deliver the Tap
Credit Assignment, as defined herein below;
(vii) Buffalo Highlands and/or B.I. shall acknowledge and deliver a
Special Warranty Deed to the First Closing Lots, subject to those matters
which Melody accepted or is deemed to have accepted pursuant to Paragraph 6
hereof ("Permitted Exceptions");
(viii) Buffalo Highlands shall pay the premium for the Title Policy
for the First Closing Lots;
(ix) Buffalo Highlands for itself and on behalf of B.I. shall deliver
possession of the First Closing Lots;
(x) Buffalo Highlands and Melody shall execute and deliver the Park
Fee Memorandum, which shall be recorded against the legal descriptions for
the First Closing Lots;
(xi) Buffalo Highlands shall execute and deliver to Melody the Deed of
Trust, defined in Paragraph 13(a) below, which shall be recorded against
the legal description of the Second Closing Lots and the Remaining Lots;
(xii) The Title Company's closing fee for the First Closing Lots shall
be divided equally between the Buffalo Highlands and Melody; and
(xiii) The Parties shall execute and deliver such additional documents
as contemplated by this Agreement or as may be necessary to conclude the
transaction or to provide for the issuance of the Title Policy in
accordance with this Agreement.
c. Second Closing. The Closing of the sale of the Second Closing Lots to
Melody ("Second Closing") shall occur at 11:00 a.m. on the date that is
twenty-one days after Buffalo Highlands receipt of written notice to close,
which Second Closing shall occur on the date that is the later of (x) one year
and one day after the date of the First Closing and (y) thirty (30) days after
the date on which Melody has sold 170 of the First Closing Lots to any party
other than an entity which is owned or controlled by Melody's parent company,
X.X. Xxxxxx, Inc., but in no event earlier that one (1) year after the or later
than two (2) years after the date of the First Closing.
d. Second Closing Items. The following shall occur at the Second Closing,
each item being a condition precedent to the others and all being considered as
occurring simultaneously:
(i) Melody shall reimburse Buffalo Highlands an amount equal to the
difference between the real estate taxes for all Lots not then owned by
Melody and the amount of real estate taxes for said Lots which would have
been assessed if the Land was not platted or rezoned, to the extent Buffalo
Highlands has paid said taxes;
(ii) Buffalo Highlands shall acknowledge and deliver the Special
Warranty Deed to the Second Closing Lots, subject to the Permitted
Exceptions;
(iii) Melody and Buffalo Highlands shall execute and deliver the ERU
Assignment and Assumption Agreement for the Second Closing Lots;
(iv) Buffalo Highlands shall pay the premium for the Title Policy for
the Second Closing Lots;
(v) Buffalo Highlands shall deliver possession of the Second Closing
Lots;
(vi) Melody shall pay to Buffalo Highlands that portion of the Total
Purchase Price equal to $19,500 multiplied by the number of Lots purchased,
approximately Three Million Four Hundred Twelve Thousand Five Hundred and
no/100 Dollars ($3,412,500) assuming 175 Second Closing Lots, with a credit
for the applicable portion of the Option Payments made to Buffalo Highlands
and subject to the Purchase Price Escalator;
(vii) Melody shall pay the recording fees for the Deed and the
documentary fee;
(viii) Taxes and other assessments attributable to the Second Closing
Lots shall be prorated and apportioned between Buffalo Highlands and Melody
as of the date of the Second Closing based upon the most recent assessment
and mill levy, and such proration shall be final;
(ix) Buffalo Highlands and Melody shall execute and deliver the Park
Fee Memorandum, which shall be recorded against the legal descriptions for
the Second Closing Lots;
(x) The Title Company's closing fee shall be divided equally between
the Parties; and
(xi) The Parties shall execute and deliver such additional documents
as contemplated by this Agreement or as may be necessary to conclude the
transaction or to provide for the issuance of the Title Policy in
accordance with this Agreement.
e. Final Closing. Closing of the sale of the Remaining Lots to Melody
("Final Closing") shall occur at 11:00 a.m. on the date that is twenty-one (21)
days after receipt by Buffalo Highlands of written notice from Melody of its
desire to close, but in no event later than the earlier of two (2) years after
the date of the Second Closing or twenty-one (21) days after the date on which
Melody has sold 105 of the Second Closing Lots to any party other than an entity
which is owned or controlled by Melody's parent company, X.X. Xxxxxx, Inc.
f. Final Closing Items. The following shall occur at the Final Closing,
each item being a condition precedent to the others and all being considered as
occurring simultaneously:
(i) Melody shall reimburse Buffalo Highlands an amount equal to the
difference between the real estate taxes for Remaining Lots and the amount
of real estate taxes for said Lots which would have been assessed if the
Land was not platted or rezoned, to the extent Buffalo Highlands has paid
said taxes;
(ii) Buffalo Highlands shall acknowledge and deliver the Deed to the
Remaining Lots, subject to the Permitted Exceptions;
(iii) Melody and Buffalo Highlands shall execute and deliver the ERU
Assignment and Assumption Agreement for the Remaining Lots;
(iv) Buffalo Highlands shall pay the premium for the Title Policy for
the Remaining Lots;
(v) Buffalo Highlands shall deliver possession of the Remaining Lots;
(vi) Melody shall pay to Buffalo Highlands that portion of the
remaining Total Purchase Price, which shall equal $19,500 multiplied by the
total number of Lots to be purchased at the Final Closing subject to the
Minimum and Maximum Purchase Price set forth in Paragraph 5, with a credit
for the applicable portion of the Option Payments made to Buffalo Highlands
and subject to the Purchase Price Escalator;
(vii) Melody shall pay the recording fees for the Deed and the
documentary fee;
(viii) Taxes and other assessments attributable to the Remaining Lots
shall be prorated and apportioned between Buffalo Highlands and Melody as
of the date of the Final Closing based upon the most recent assessment and
mill levy, and such proration shall be final;
(ix) Buffalo Highlands and Melody shall execute and deliver the Park
Fee Memorandum, which shall be recorded against the legal descriptions for
the Remaining Lots;
(x) The Title Company's closing fee shall be divided equally between
the Parties; and
(xi) The Parties shall execute and deliver such additional documents
as contemplated by this Agreement or as may be necessary to conclude the
transaction or to provide for the issuance of the Title Policy in
accordance with this Agreement.
9. Governmental Approval and Improvements.
a. Governmental Approvals. The Parties acknowledge that Buffalo Highlands
is an investment entity and is not in the business of developing property or
seeking approvals for development. However, since Melody does not own the Land
and cannot seek development approvals for the Land itself, Buffalo Highlands
shall use commercially reasonable efforts to obtain, on behalf of Melody, any
and all approvals from the City and other governmental entities necessary for
the final approval of a final plat(s) for the B.I. Property and the Lots
("Governmental Approvals"). Buffalo Highlands shall use commercially reasonable
efforts to cause, and to seek B.I.'s cooperation in causing, on behalf of
Melody, all maps, plans and other documents necessary to obtain the Governmental
Approvals ("Approval Documents") to be prepared and submitted to the City or
other appropriate governmental entities. Buffalo Highlands shall provide Melody
reasonable notice of all meetings with the City or other appropriate
governmental entities with respect to the Governmental Approvals and the
opportunity to attend said meetings. Melody and Buffalo Highlands hereby approve
Xxxxxxx Xxxx & Associates ("Lash") and Xxxx & Associates ("Xxxx")(collectively,
the "Project Consultants") as, respectively, the planners and engineers for the
creation, submission and processing of the Approval Documents, and shall
cooperate in good faith in approving bids for work by the Project Consultants.
Notwithstanding the foregoing to the contrary, in the event Melody wishes to
utilize a different engineer subsequent to the approval of the PUD Zone Document
for the B.I. Property, then within thirty (30) days after approval of the PUD
Zone Document, Melody may provide written notice of such desire to Buffalo
Highlands, together with the names of at least two engineers which Melody would
prefer to retain, and the Parties shall agree upon one of those engineers to
replace Xxxx within said thirty (30) day period. If either Party is reasonably
unsatisfied with the work of the Project Consultants, the Parties agree to
cooperate to select a replacement Project Consultant(s). Melody shall pay all
costs associated with the creation, submittal and processing of the Approval
Documents and the Governmental Approvals for the subdivision and development of
the Land incurred from March 7, 2003 until the earlier of the termination of
this Agreement or Final Closing, or mutual written agreement of the Parties.
Within five (5) days after the expiration of the Inspection Period, Melody shall
pay to Buffalo Highlands an amount equal to all costs which Buffalo Highlands
has incurred on behalf of Melody in relation to the Governmental Approvals and
Approval Documents for the subdivision of the Land from March 7, 2003 until the
expiration of the Inspection Period, provided that Melody has received copies of
paid invoices evidencing payment of such costs by Buffalo Highlands. In the
event the City institutes a moratorium or other policies which would delay
approval of final plat for the Land, Buffalo Highlands shall continue to use
commercially reasonable efforts to cause the preparation, submittal of the
Approval Documents to the extent the City will accept said Approval Documents,
and Melody shall continue to pay the costs as described in the preceding
sentence. Such payments made for development related expenses and assessments by
Melody will not be credited against the Total Purchase Price or prorated on the
date of Closing. Melody and Buffalo Highlands shall enter into all agreements
with the Project Consultants that are necessary for said work ("Consultant
Agreements"). In the event that Melody or Buffalo Highlands terminates this
Agreement for any reason other than default by Buffalo Highlands of its
obligations hereunder, or in the event Melody fails to exercise the Option,
Melody shall assign to Buffalo Highlands all of its rights to all work prepared
by the Project Consultants and under the Consultant Agreements with respect to
the Land, and Buffalo Highlands shall assume Melody's obligations under the
Consultant Agreements that are to be performed after the date of said
termination or failure to exercise the Option and shall indemnify Melody against
claims by the Project Consultants for said obligations. Melody's obligations
under this Paragraph shall survive Closing or any earlier termination of the
Agreement to the extent that said obligations are incurred prior to the
applicable Closing or termination. Buffalo Highlands shall submit to Melody for
Melody's review and written approval, which approval shall not be unreasonably
withheld or delayed, all Governmental Approvals and material revisions thereto
prior to submission to the City or other governmental authorities. Melody's
approval of said documents shall be deemed to have been given if Melody does not
deliver to Buffalo Highlands written notice of approval or objection within five
(5) business days of receipt by Melody of said documents. Notwithstanding
anything to the contrary in this Agreement, Buffalo Highlands shall not be in
default of this Agreement if the Governmental Approvals are not obtained prior
to the expiration of the Option Term, unless Buffalo Highlands is in default of
its obligations under this Paragraph 9(a).
b. Multi-Family Cell(s). The Parties acknowledge that it is possible that
the City may require or Melody may request that a portion of the Land be zoned
and platted for attached residential units ("Multi-Family Cell(s)"), and that
the City may allow Buffalo Highlands and/or Melody to determine the exact
location of the Multi-Family Cell(s) on the Land. If the City does require, or
Melody does request and the City does allow, a Multi-Family Cell(s) on the Land
prior to Melody's exercise of the Option or the option under the B.I. Option
Agreement, then the Parties agree that a separate Lot shall be deemed to have
been created for each residential unit to be constructed within the Multi-Family
Cell(s) for the purposes of calculating the Total Purchase Price.
c. Off-Site Improvements. Melody shall construct or cause the construction
of all Off-Site Improvements necessary to serve that portion of the Land, which
has been purchased by Melody. "Off-Site Improvements" shall mean all water
mains, sanitary sewer mains, electric, telephone, cable, and gas lines, streets,
curbs, sidewalks, gutters, landscaping, traffic signals, street lights, and
lighting to be constructed up to the boundary of the Land. The Off-Site
Improvements shall be constructed by Melody in accordance with the Approval
Documents. Melody shall commence construction of the Off-Site Improvements in
accordance with the final plat and phasing plan approved by the City on or
before the date that is twelve (12) months after the later of (i) the First
Closing; or (ii) the date the Governmental Approvals are obtained, to include
the final plat and engineering approvals for the Lots purchased at the First
Closing. To the extent Melody constructs a portion of 00xx Xxxxxx not contiguous
to the Land, Melody shall be entitled to any reimbursement for said construction
costs offered by the City and all state and federal governmental agencies (for
the purposes of this Paragraph, the District, as defined herein below, shall not
be considered a state or federal governmental agency) which may offer
reimbursement for such construction. Buffalo Highlands agrees to execute any
necessary documentation to assign any such reimbursements to Melody. At each
Closing, Buffalo Highlands agrees to (i) provide Melody with any and all
easements and licenses on the portions of the Land retained by Buffalo
Highlands, and not purchased by Melody, as may be necessary for Melody to
construct or cause to construct the Off-Site Improvements and (ii) grant and
convey all necessary dedications for public right-of-ways, utilities and tracts
in connection therewith, as provided in the Approval Documents.
(i) The Parties acknowledge that the City may require that a bridge be
constructed for 96th Avenue ("Bridge") in conjunction with the development of
Seller's Land and other properties in the vicinity. In the event the City
requires Melody to construct the Bridge in association with the Governmental
Approvals, then Buffalo Highlands shall use commercially reasonable efforts to
cause the City to secure commitments from other benefited parties to reimburse
Melody for those parties' proportionate shares of the costs of constructing the
Bridge.
d. On-Site Improvements. Melody shall construct or cause the construction
of all utilities and other improvements within that portion of the Land which
has been purchased by Melody as required by the City or any other applicable
governmental or quasi-governmental entity, including, without limitation,
improvements for and related to a xxxx-water irrigation system, as described in
the FRICO Agreement, as defined herein below ("Irrigation System"), improvements
related to parks, trails, recreational facilities, and school sites, but
excluding all improvements to be made by Melody with the boundary of each Lot
("On-Site Improvements"). The On-Site Improvements shall be constructed by
Melody of sufficient size and quantity to provide service to the Land. Melody
shall commence construction of the On-Site Improvements in accordance with the
final plat and phasing plan approved by the City on or before the date that is
twelve (12) months after the later of (i) the First Closing; or (ii) the date
the Governmental Approvals are obtained. The Parties acknowledge that SACWSD, as
defined herein below, may offer a credit to tap fees relating to water and sewer
service based on installation of Irrigation System. The Parties shall enter into
an agreement by which Buffalo Highlands assigns to Melody, at no cost to Melody,
any rights, title or obligations it may have to said tap fee credits in relation
to Melody's installation of the Irrigation System on the Land at Closing ("Tap
Credit Assignment"), the form and substance of which shall be agreed upon by the
Parties prior to the expiration of the Inspection Period. At each Closing,
Buffalo Highlands agrees to (i) provide Melody with any and all easements and
licenses on the portions of the Land retained by Buffalo Highlands, and not
purchased by Melody, as may be necessary for Melody to construct or cause to
construct the Off-Site Improvements and (ii) grant and convey all necessary
dedications for public right-of-ways, utilities and tracts in connection
therewith, as provided in the Approval Documents.
(i) Force Majeure. In the event that Melody's unable to meet the
deadlines set forth in Paragraphs 9(b) and 9(c) hereof because of delays
from causes beyond the reasonable control of Melody, including, without
limitation, delays caused by acts or omissions of Buffalo Highlands or any
affiliate, agent or employee of Buffalo Highlands, acts of God, strikes,
work stoppages, unavailability or delay in receiving labor or materials,
defaults by contractors or subcontractors of a special district or utility
company, weather conditions, acts of aggression, fire or other casualty,
then said deadline shall be extended for a period of time equal to the
length of said delay or delay(s).
e. Conveyance to District. Unless otherwise agreed by the Parties, upon
completion and in connection with initial acceptance of the applicable phase of
On-Site Improvements and Off-Site Improvements (collectively, "Project
Improvements") by the City or other governmental or quasi-governmental entity,
the Project Improvements, except any portion of 96th Avenue which does not abut
the Land, shall be transferred and conveyed by Melody by warranty xxxx of sale,
free and clear of liens and encumbrances, to the District, as defined herein
below, or as otherwise directed by Buffalo Highlands, without additional
consideration and Melody shall instruct the District that Buffalo Highlands
shall be entitled to any payment or reimbursement from the District for the
Project Improvements. Notwithstanding the conveyance to the District, Melody
shall be responsible for the maintenance of the Project Improvements and posting
all bonds and other security required by the City or SACWSD (as applicable), if
any, for the warranty period required by the City or SACWSD (as applicable) for
such Project Improvements. Melody shall not be responsible for the maintenance
of or posting bonds for security with respect to any improvement not constructed
by Melody or any Project Improvements after the expiration of the warranty
period. Melody shall cooperate with Buffalo Highlands and the District in
causing the District to issue directly to Buffalo Highlands the District's
promissory note ("District Note") in exchange for the Project Improvements
conveyed by Melody to District, including the execution of assignments,
infrastructure acquisition agreements, or other documents reasonably requested
by Buffalo Highlands to effectuate the intent of the Parties that Buffalo
Highlands receive any consideration from the District for the Project
Improvements; provided, however, that Melody shall not be required to execute
any instrument that would impose any financial obligation or other obligations
or liabilities upon Melody nor shall Melody be required to incur any cost or
expense with respect to such matters relating to the District Note or any
transfer of the Project Improvements to the District. The Parties hereby
acknowledge that the District Note issued directly to Buffalo Highlands by the
District is part of the consideration for the sale of the Land from Buffalo
Highlands to Melody.
f. South Xxxxx County Water and Sanitation District. Melody acknowledges
and accepts that Buffalo Highlands entered into a FRICO Participant Water
Resource Agreement on November 2, 2001 with the South Xxxxx County Water and
Sanitation District ("SACWSD"), and that a copy of that Water Resource
Agreement, ("FRICO Agreement") has been delivered to Melody. Under the FRICO
Agreement, Buffalo Highlands and B.I., after having assigned to a third-party
the right to purchase 109 ERU's by that certain ERU Water Connection Exchange
Agreement, have the right to acquire 1022 ERU Water Connections and 1022 ERU
Water Rights Credits (ERU Water Connections and ERU Water Rights Credits are
referred to collectively herein as "ERU's") of the following types: 141 ERU's
which are available prior to approval by applicable water courts of certain
actions with respect to provision of water by the SACWSD ("Pre-Court ERU's");
and 881 ERU's available after approval by applicable water courts of certain
actions with respect to provision of water by the SACWSD ("Post-Court ERU's").
At the First Closing, Buffalo Highlands, B.I. and Melody shall enter into a
partial assignment and assumption agreement of the FRICO Agreement, by which
Buffalo Highlands and B.I. shall assign and Melody shall assume all of Buffalo
Highlands' and B.I.'s rights and obligations under the FRICO Agreement with
respect to one ERU for each Lot and Landscaping ERU's, if necessary, to service
the Lots and common area within the Land purchased by Melody or conveyed to the
City or homeowners association at the First Closing, including, without
limitation, all of the 141 Pre-Court ERU's ("ERU Assignment and Assumption
Agreement"). At the Second Closing, Melody shall assume, pursuant to the ERU
Assignment and Assumption Agreement all of Buffalo Highland's (and B.I, if B.I
retains any interest under the FRICO Agreement) rights to one ERU for each Lot
and Landscaping ERU's to service the Lots and common areas within the Land
purchased by Melody or conveyed to the City or homeowners association at the
Second Closing. At the Final Closing, Buffalo Highlands shall assign to Melody
all of its rights, pursuant to the ERU Assignment and Assumption Agreement all
of Buffalo Highlands' rights (and B.I. shall assign all of its rights, if any
remain) to one ERU for each Lot and Landscaping ERU's to service the Lots and
common areas within the Land purchased by Melody or conveyed to the City or
homeowners association. Any remaining ERU's which are or will not be used by
Buffalo Highlands or transferred by Buffalo Highlands to a third-party with
respect to the development of property immediately to the east of the B.I.
Property shall be conveyed to Melody. Buffalo Highlands shall cause additional
ERU's (Landscaping ERU's") to be conveyed to Melody in the event that the ERU's
described in the preceding sentences are insufficient for the irrigation of all
parks, open space and landscaping to be constructed or maintained on the Land at
Closing, subject to the availability of the ERU's under the FRICO Agreement. The
Parties shall agree upon the form of the ERU Assignment and Assumption Agreement
prior to the expiration of the Inspection Period.
(i) Obligations Under FRICO Agreement. The Parties acknowledge that
pursuant to the terms of the FRICO Agreement, Buffalo Highlands and B.I.
may be obligated to make certain pre-payments for the ERU's, and that
pursuant to Paragraph 2.6 of the FRICO Agreement, Buffalo Highlands and
B.I. may elect to make such pre-payments in one payment when due ("Cash
Plan") or in annual installments over 15 years ("Installment Plan"). In the
event that such pre-payments must be made prior to the First Closing, then
Buffalo Highlands shall give Melody written notice thereof, and at least
five (5) business days after delivery of said notice, Buffalo Highlands
shall elect to proceed under the Installment Plan. Buffalo Highlands shall
thereafter make the scheduled Installment Plan pre-payments until the First
Closing, at which time Melody shall reimburse Buffalo Highlands for that
portion of said pre-payments allocated to the ERU's purchased or to be
purchased by Melody ("Melody's Share"). From and after the First Closing,
Melody shall pay to FRICO, or such other party as required under the FRICO
Agreement, Melody's Share of the FRICO Payments ("Melody's FRICO
Payments"), and Buffalo Highlands shall be liable for remitting its share,
the remaining balance, under the Installment Plan ("Buffalo Highlands FRICO
Payment") as required under the FRICO Agreement and this Paragraph. If
Melody fails to timely make the Melody FRICO Payments, then Melody shall be
in default of this Agreement. If Buffalo Highlands fails to timely make the
Buffalo Highlands FRICO Payment as required under the FRICO Agreement, then
Buffalo Highlands shall be in default of this Agreement. Buffalo Highlands
shall maintain the FRICO Agreement in full force and effect, and shall not
cause or allow any amendments to, modifications of or defaults under the
FRICO Agreement without Melody's prior written consent, which consent shall
not be unreasonably withheld or delayed.
g. Survival. The provisions of this Paragraph 9 shall survive each Closing.
10. Metropolitan District. Melody acknowledges that a metropolitan district (the
"District") has been formed to provide a financing mechanism for the acquisition
and maintenance of a portion or all of infrastructure improvements for the Land.
The service area for the District encompasses all of the Land and no portion of
the Land will be excluded from the District without Melody's prior written
consent. Buffalo Highlands shall not cause the inclusion of any additional
property within the boundaries of the District without the prior written consent
of Melody. Buffalo Highlands shall deliver to Melody for Melody's review a copy
of the service plan for the District ("Service Plan") within five (5) days after
the Effective Date. The Service Plan provides that the total debt mill levy,
exclusive of the operations and maintenance mill levy, against the Lots shall
not exceed 50 xxxxx (subject to periodic increase in accordance with Colorado
law) based upon the real estate assessment laws, regulations and procedures and
the mill levy structure currently applicable and utilized by the City, and
anticipates that a mill levy of 42. will be sufficient to service the debt and
operations and maintenance expenses of the District. Notwithstanding the
foregoing, Buffalo Highlands agrees that for three (3) years from the date that
the District delivers the District Note to Buffalo Highlands (the "Note
Closing"), provided that Melody is not in default under any of the provisions of
this Agreement, neither Buffalo Highlands nor any entity under common ownership,
management or control of Buffalo Highlands shall request: (1) that the District
impose or collect any fees, rates or charges for payment of such bonds issued by
the District; or (2) that the District increase its mill levy for payment of
bonds issued by the District and owned by Buffalo Highlands or its affiliate to
a number which would exceed 42 xxxxx in 2003 plus 10% (non-compounded) for every
year thereafter (the "Mill Levy Limitation"). For purposes of calculating the
Mill Levy Limitation, the number 42 may be increased or decreased to take into
account legislative or constitutionally imposed adjustments in assessed values,
or the method of calculating assessed values, which may occur after 2003. If the
mill levy exceeds 44 xxxxx at the time of the Note Closing or for three (3)
years thereafter, then Buffalo Highlands shall pay the excess to the District on
behalf of Melody with respect to all Lots then owned by Melody.
Except as previously disclosed to Melody and except as provided for in this
Paragraph, Buffalo Highlands shall not cause the Land to be included in any
other district without Melody's prior written consent, which consent shall not
be unreasonably withheld or delayed. At the First Closing, Buffalo Highlands
shall cause one person selected by Melody to be appointed a director of the
District and will, to the extent allowed by law, assist Melody in maintaining
one (1) person as a director until such time as Melody no longer owns title to
any Lots.
11. Surface Use Agreements.
a. Northwest Quarter of Section 21. The Parties acknowledge that parties
other than Buffalo Highlands and B.I. ("NW Mineral Owners") own oil, gas and
other minerals underlying that portion of the Land lying within the Northwest
Quarter of Section 21. Buffalo Highlands shall use commercially reasonable
efforts to enter into a surface use agreement with the NW Mineral Owners ("NW
Surface Use Agreement") prior to Closing, which NW Surface Use Agreement shall
be subject to Melody's approval, which approval shall not be unreasonably
withheld. Notwithstanding the foregoing to the contrary, Melody may withhold
said approval if said NW Surface Use Agreement allows use of the surface of the
Northwest Quarter of Section 21 by the NW Mineral Owners in such a way that
would materially and adversely affect Melody's construction of homes on the Lots
or the issuance of certificates of occupancy therefore. Melody shall have no
obligation for any costs or expenses associated with the NW Surface Use
Agreement, and Buffalo Highlands shall indemnify Melody with respect to any
costs or expenses incurred by Melody as a result of the NW Surface Use Agreement
provided that Melody delivers to Buffalo Highlands written notice of a claim for
such indemnification within six (6) months after the Final Closing.
b. Southwest Quarter of Section 21. The Parties acknowledge that a portion
of the Southwest Quarter of Section 21 is subject to an oil and gas lease ("Oil
and Gas Lease") dated March 27, 1980 with PARD, Inc., which Oil and Gas Lease
was subsequently assigned to Trinity Energy Corporation ("Trinity"), and that
one producing oil and gas well ("Well") and related tank battery ("Battery") are
located on the Land. Buffalo Highlands shall, pursuant to the terms of a letter
agreement with Trinity dated December 12, 2001, cause the termination of the Oil
and Gas Lease as it applies to the Land, and shall cause the Well to be plugged
and abandoned and the Battery to be relocated to a location which would not
adversely and materially affect Melody's construction of homes on the Lots or
the issuance of certificates of occupancy therefore. Melody shall have no
obligation for any costs or expenses associated with the termination of the Oil
and Gas Lease, the abandonment of the Well, or the relocation of the Battery and
Buffalo Highlands shall indemnify Melody with respect to any costs or expenses
incurred by Melody as a result of the termination of the Oil and Gas Lease, the
abandonment of the Well, or the relocation of the Battery provided that Melody
delivers to Buffalo Highlands written notice of a claim for such indemnification
within six (6) months after the Final Closing.
c. Lots. In the event a home cannot be constructed on any Lot due to
encroachment onto said Lot by a building restrictions and/or setback for any oil
and gas surface facility, said Lot shall, at Melody's option, be excluded from
Melody's purchase, and the Minimum Purchase Price shall be reduced by an amount
equal to $19,500 multiplied by the number of Lots so impacted.
12. Warranties.
a. Buffalo Highlands. Buffalo Highlands hereby represents and warrants,
only with respect to itself, that the following are true and correct as of the
date hereof and shall be true and correct at the time of Closing:
(i) Buffalo Highlands is a Colorado limited liability company duly
organized and validly existing under the laws of the State of Colorado.
(ii) To the best of Buffalo Highlands' knowledge, there are no suits,
proceedings, or litigation affecting the B.I. Property.
(iii) The B.I. Option Agreement is in full force and effect, and
neither party thereto is in default thereof.
(iv) Buffalo Highlands has not granted to any other person or entity
any right or option to acquire any of Buffalo Highlands' rights under the
B.I Option Agreement, or any part thereof.
(v) The execution of this Agreement and the consummation of the
transactions contemplated hereby are not (nor will they be with the passage
of time) a breach or default under any agreement or instrument to which
Buffalo Highlands is a party.
(vi) Buffalo Highlands has not knowingly withheld and will not
willingly withhold any material adverse information pertaining to the
Property.
(vii) Buffalo Highlands shall comply with the mineral owner
notification requirements of CRSss.24 - 65.5-101 et seq.
(viii) To the best of Buffalo Highlands' knowledge, except as
disclosed by a Phase I Environmental Assessment report date August 15, 2001
and prepared by Xxxx & Associates, and except as otherwise previously
disclosed to Melody in writing, there are no existing violation or claimed
violation of any law or regulation relating to Hazardous Substances on or
under the Land, nor has any such violation or claim to violation occurred
in the past, the Land is not on any "Superfund" list under any applicable
Environmental Law. As used in this Agreement, "Hazardous Substance" shall
mean and include all hazardous or toxic substances, wastes or materials,
any pollutants or contaminates (including, without limitation, asbestos and
raw materials which include hazardous constituents, radon and urea
formaldehyde, diisopropyl/methylphosphonate), and any other similar
substances or materials, which are included or regulated by any local,
state, or Federal law, rule, or regulation pertaining to regulation,
contamination, clean-up or disclosure.
(ix) "To the best of Buffalo Highlands' knowledge" means the current
and actual knowledge of Xxxx X. Xxxxxxx, Xxxxxxx Xxxxxx and Xxxxx X. Xxxxxx
without any duty to investigate.
b. Melody. Melody hereby represents and warrants that the following are
true and correct as of the date hereof and shall be true and correct at the time
of Closing:
(i) Melody is a corporation duly organized and validly existing under
the laws of the State of Delaware, and is authorized to do business in the
State of Colorado.
(ii) The execution of this contract and the consummation of the
transactions contemplated hereby are not (nor will they be with the passage
of time) a breach or default under any agreement or instrument to which
Melody is a party, nor will they require the further consent or approval of
any other person other than the corporate approval provided for in
Paragraph 14(u).
c. As-Is. Acknowledging Melody's opportunity to inspect the Property,
Melody agrees to take the Property "As Is", "Where Is", with all faults and
conditions thereon. Any information reports, statements, documents or records
("Disclosures") provided or made to Melody or its constituents by Buffalo
Highlands or B.I., their agents, members or employees concerning the condition
(including, but not limited to, the environmental condition) of the Land shall
not be representations or warranties, unless specifically set forth in this
Agreement. Melody shall not rely on such disclosures, but rather, Melody shall
rely only on its own inspection of the Land. Melody acknowledges that the
Purchase Price reflects and takes into account that the Land is being sold "As
Is". Upon each Closing, Melody shall assume the risks that adverse matters,
including, without limitation, adverse physical and environmental conditions,
excluding any latent defects cause by Buffalo Highlands, may not have been
revealed by Melody's investigation, and Melody, upon each Closing, shall be
deemed to have waived, relinquished and released Buffalo Highlands and Buffalo
Highlands' officers, members, employees and agents from and against any and all
claims, liabilities, losses, costs, damages or expenses of any kind, including,
without limitation, reasonable attorneys' fees, arising from or in any way
related to any physical conditions of the purchased portion of the Land,
violations of any applicable law and any and all other acts, omissions, events,
circumstances or matters regarding the Land.
d. Survival of Warranties. The representations and warranties set forth in
this Paragraph 12 shall be deemed to be remade as of each Closing and shall
survive each such Closing for a period of one (1) year from the date of the
Closing. Notice of any claim as to a breach of any representation or warranty
must be made to Buffalo Highlands prior to the expiration of one-year period or
it shall be deemed a waiver of the right to assert such claim.
13. Remedies.
a. Buffalo Highlands' Failure to Close. In the event Buffalo Highlands
defaults in the performance of its obligation to close hereunder, Melody shall
have the right to either (i) terminate this Agreement, in which event Melody
shall be entitled to the repayment of the Option Payments paid by Melody to
Buffalo Highlands, and if said repayment is not made within ninety (90) days
after written demand by Melody, Melody may exercise its rights under a Deed of
Trust ("Deed of Trust") which shall be recorded against the portions of the Land
owned by Buffalo Highlands (i.e. the B.I. Property less the lots purchased by
Melody), which Deed of Trust shall be in a form to be agreed upon the Parties
during the Inspection Period, as Melody's sole and exclusive remedy for such
default; or (ii) exercise any remedies that are available under Colorado law or
equity, including, without limitation, specific performance; provided, however,
that Melody shall not recover damages other than the actual out-of-pocket
damages incurred. Melody hereby waives recovery of consequential and punitive
damages. The Deed of Trust shall provide for releases of parcels for conveyance
to the homeowners association, City, right-of-ways, utilities, and for the
release of the Second Closing Lots at or prior to the Second Closing.
b. Melody's Failure to Close. In the event Melody defaults in the
performance of its obligations to close hereunder, Buffalo Highlands shall have
the right to terminate this Agreement and retain all moneys paid by Melody
and/or to exercise any remedies that are available under Colorado law or equity,
excluding specific performance; provided, however, that Buffalo Highlands shall
not recover damages other than actual out-of-pocket damages incurred. Buffalo
Highlands hereby waives recovery of consequential and punitive damages.
c. All Other Defaults. If either Party defaults in the performance of any
of its material obligations hereunder other than the obligations to close, the
non-defaulting Party shall give written notice of the default to the defaulting
Party. If such default is not cured within ten (10) days after receipt of such
notice, the non-defaulting Party shall have the right to terminate this
Agreement and retain all moneys paid by the defaulting Party or, if the
non-defaulting Party is Melody, Melody may elect to exercise either the remedies
set forth in Paragraph 13(a)(i) or 13(a(ii), but not both; or, if Melody is in
default of any of its obligations under Paragraphs 7(b), 9(b)-(f), 14 or 15c),
the Buffalo Highlands shall have the right to exercise any remedies that are
available under Colorado law or equity, including, without limitation, specific
performance; provided, however, that Buffalo Highlands shall not recover damages
other than actual out-of-pocket damages incurred
d. Attorneys' Fees. Should any action be brought in connection with this
Agreement, including, without limitation, actions based on contract, tort or
statute, the prevailing party in such action shall be awarded all costs and
expenses incurred in connection with such action, including reasonable
attorneys' fees. The provisions of this Paragraph 13(d) shall survive the
Closing, expiration or the termination of this Agreement.
14. Defaults under B.I. Option Agreement. In the event of any default by Melody
or B.I. under the B.I. Option Agreement, Melody shall give Buffalo Highlands
immediate written notice of such default. In the event of a default by Melody
under the B.I. Option Agreement which Melody fails to cure within any cure
period provided for under the B.I. Option Agreement, Melody agrees and
acknowledges that Buffalo Highlands shall have the right to cure Melody's
default, and if Buffalo Highlands does so cure, Buffalo Highlands shall be
entitled to assume all rights of Melody under the B.I. Option Agreement, and
Melody shall take all actions and execute all documents necessary to assign said
rights to Buffalo Highlands.
15. Miscellaneous.
a. Notices. All notices required to be given hereunder shall be in writing
and shall be addressed as follows, or as either Party may subsequently designate
by written notice to the other. All notices shall be delivered by facsimile,
recognized overnight delivery service, or hand-delivery and shall be deemed
effective upon: (i) the successful transmission of a facsimile; (ii) deposit
with a recognized overnight delivery service; or (iii) upon receipt by
hand-delivery:
To Melody:
Melody Homes, Inc.
00000 Xxxxxxxx Xxxx.
Xxxxxxxxxxx, XX 00000
Attention: Xxxxx Xxxxxxx
Facsimile: (000) 000-0000
with a copy to:
Xxxxxx Xxxxx, Esq.
Melody Homes, Inc.
00000 Xxxxxxxx Xxxx., Xxxxx X
Xxxxxxxxxxx, XX 00000
Facsimile: (000) 000-0000
to Buffalo Highlands:
c/o Xxxx X. Xxxxxxx
0000 Xxxxxxxx, Xxxxx 000
Xxxxxx, XX 00000
Facsimile: (000) 000-0000
x/x Xxxxx X. Xxxxxx
00 Xxxxxx Xxxx
Xxxxxxxxx, XX 00000
Facsimile: (000) 000-0000
with a copy to:
XXXXX & XXXXXXX, P.C.
0000 00xx Xxxxxx, Xxxxx 000
Xxxxxx, Xxxxxxxx 00000
Attention: Xxxxxx X. Xxxxx
Facsimile: (000) 000-0000
b. Assignment. Neither Party shall have the right to assign this Agreement
without the other Party's prior written consent, which consent shall not be
unreasonably withheld or delayed. Notwithstanding the foregoing, Melody may
assign its rights and obligations under this Agreement after the First Closing
to an entity which is owned or controlled by Melody's parent company, X.X.
Xxxxxx, Inc. without obtaining Buffalo Highlands consent, but Melody shall
promptly provide Buffalo Highlands written notice of such assignment.
c. Indemnification; No Mechanic's Liens. Melody hereby acknowledges that
the preparation and submission of the Approval Documents and any plans, and the
making of investigations, tests and surveys prior to the Closings hereunder, are
for the mutual benefit of Melody and Buffalo Highlands. Each Party agrees not to
permit or suffer and, to the extent so permitted or suffered, to cause to be
removed and released, any mechanic's, materialman's, or other lien on any
portion of the B.I. Property not owned by said Party, account of supplies,
machinery, tools, equipment, labor or materials furnished or used in connection
with the planning, design, inspection, construction, alteration, repair or
surveying of the B.I. Property or any portion thereof, or preparation of plans
with respect thereto by, through or under Melody. Each Party ("Indemnifying
Party") agrees to indemnify, hold harmless and defend the other Party and B.I.
from any claim, liability, loss, damage, cost or expense, including attorneys'
fees, which the other Party or B.I. may incur or which may be asserted by reason
of work performed by, through or under the Indemnifying Party or the preparation
of the Approval Documents and any plans, as requested by Melody, or the making
of investigations, tests and surveys ordered or conducted by that Party. Each
Party acknowledges and agrees that either Party or B.I. may, but shall not be
required to, post or serve a notice that such Party's or B.I.'s interest in the
B.I. Property shall not be subject to any mechanics' liens pursuant to the
provisions of C.R.S.ss.00-00-000, and to take such other actions as deemed
necessary to comply with the provisions of said statute.
d. Third-Party Beneficiaries. The agreements contained herein are solely
for the benefit of the Parties hereto and no other person or entity shall be a
third party beneficiary thereof.
e. Binding Effect. This Agreement shall be binding upon and inure to the
benefit of the Parties hereto and their respective, successors and assigns.
f. Real Estate Commission. Each Party represents that it has not retained
any real estate agent or broker who would be entitled to a commission or fee in
connection with this Agreement. Each Party hereto shall defend and hold harmless
the other Party ("Indemnified Party") from any claim for a commission or
finder's fee asserted by any party against the Indemnified Party except for a
claim for a commission by reason of an agreement between a third-party and the
Indemnified Party.
g. Applicable Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Colorado.
h. Entire Agreement. This Agreement contains the entire agreement between
the Parties with respect to the Land. In entering into this Agreement, neither
Party has relied upon any promise, representation or assurance of any nature
except as specifically provided herein.
i. Severability. In the event any one or more of the provisions herein, or
any application thereof, shall be invalid, illegal or unenforceable in any
respect, the validity, legality and enforceability of the remaining provisions
contained herein, and any other application thereof, shall not in any way be
affected or impaired thereby and shall be enforced to the greatest extent
permitted by law.
j. Not to be Construed Against Drafter. This Agreement shall not be
construed more strictly against one Party than the other merely by virtue of the
fact that it may have been initially drafted by one of the Parties or their
counsel, since both Parties have contributed substantially and materially to the
preparation hereof.
k. Time. Time is of the essence of this Agreement. In computing any period
of time herein, the date of the act or event from which the designated period of
time begins to run shall not be included. The last day of the period so computed
shall be included unless it is a Saturday, Sunday or federal legal holiday, in
which case the period of time shall run until the end of the next day which is
not a Saturday, Sunday or federal legal holiday.
l. Special Taxing Districts. The following disclosure is included in
accordance with Section 38-35.7-101, C.R.S.:
SPECIAL TAXING DISTRICTS MAY BE SUBJECT TO GENERAL OBLIGATION INDEBTEDNESS
THAT IS PAID BY REVENUES PRODUCED FROM ANNUAL TAX LEVIES ON THE TAXABLE
PROPERTY WITHIN SUCH DISTRICTS. PROPERTY OWNERS IN SUCH DISTRICTS MAY BE
PLACED AT RISK FOR INCREASED MILL LEVIES AND EXCESSIVE TAX BURDENS TO
SUPPORT THE SERVICING OF SUCH DEBT WHERE CIRCUMSTANCES ARISE RESULTING IN
THE INABILITY OF SUCH A DISTRICT TO DISCHARGE SUCH INDEBTEDNESS WITHOUT
SUCH AN INCREASE IN MILL LEVIES. MELODY SHOULD INVESTIGATE THE DEBT
FINANCING REQUIREMENTS OF THE AUTHORIZED GENERAL OBLIGATION INDEBTEDNESS OF
SUCH DISTRICTS, EXISTING MILL LEVIES OF SUCH DISTRICT SERVICING SUCH
INDEBTEDNESS, AND THE POTENTIAL FOR AN INCREASE IN SUCH MILL LEVIES.
m. No Recording. Neither Party hereto shall record or cause to be recorded
this Agreement or any part hereof or any memorandum thereof, and if either Party
shall do so, it shall be in default under this Agreement.
n. OILSR Exemption. Melody hereby acknowledges and agrees that this
transaction is being made in reliance upon the exemption set forth in Section
1710.5(b) of the Rules and Regulations of the Office of Interstate Land Sales
Registration, and that Buffalo Highlands is only able to determine the
applicability of such exemption to this transaction by relying upon the
following affirmations, representations and warranties of Melody. Thus, in
recognition of the above, Melody without qualification, hereby unconditionally
covenants, agrees, represents and warrants to Buffalo Highlands, and agrees to
indemnify and hold harmless Buffalo Highlands from any liability resulting from
the inaccuracy thereof, that Melody is acquiring the Property for the purpose of
engaging in the business of constructing residential building or for the purpose
of resale or lease of the Property to persons engaged in such business. Melody's
representations, warranty and indemnity obligations under this Paragraph 12(n)
will survive the Closing.
o. Relationship of Parties. Nothing in this Agreement shall be construed or
deemed to make Buffalo Highlands and Melody partners, joint venturers or any
other form of joint participants in the acquisition and development of the Land,
and Buffalo Highlands and Melody agree that the sole and exclusive nature of
their relationship is as seller and purchaser.
p. Mutual Cooperation. The Parties hereto shall execute all documents and
take all other actions necessary to effectuate the intent of the Parties as set
forth herein.
q. Counterparts and Facsimile Signatures. This Agreement may be executed in
multiple counterparts, which taken together shall be deemed one original.
Facsimile transmissions of signatures shall be accepted and binding as
originals.
r. Section 1031 Exchange. Either Party ("Exchanging Party") may structure
the disposition or acquisition of the Assignment as a like-kind exchange under
Internal Revenue Code Section 1031 at said Party's sole cost and expense. The
other Party shall reasonably cooperate therein, provided that the other Party
shall incur no costs, expenses or liabilities (including the other Party's
reasonable attorneys' fees) in connection with Exchanging Party's exchange, and
provided that said exchange does not delay the Initial or the Final Closing by
more than five (5) business days. The Exchanging Party shall indemnify, defend
and hold the other Party harmless therefrom and the other Party shall not be
required to take title to or contract for purchase of any other property. If the
Exchanging Party uses a qualified intermediary to effectuate the exchange, any
assignment of the rights or obligations of the Exchanging Party hereunder shall
not relieve, release or absolve the Exchanging Party of its obligations to the
other Party.
s. Confidentiality. Neither Party shall disclose any of the terms or
conditions of this Agreement to any third-party, other than said Party's legal
counsel and other consultants, without the prior written consent of the other
Party, which consent may be withheld for any reason, in said other Party's sole
and absolute discretion.
t. Prohibition on Contracts With B.I. As a material inducement to Buffalo
Highlands to enter into this Agreement, Melody agrees that in the event this
Agreement is terminated for any reason other than a material default by Buffalo
Highlands under this Agreement, or the Option expires, Melody may not enter into
a contract to purchase or otherwise acquire any interest in the B.I. Property,
or in any entity which owns any portion of the B.I. Property, for a period of
three (3) years after the termination of this Agreement or the expiration of the
Option.
u. Melody Corporate Approval. Notwithstanding anything contained herein to
the contrary, neither this Agreement nor any amendment hereto shall be a valid
and enforceable obligation of Melody unless this Agreement or such amendment is
executed by any one of Xxxxx X. Xxxxx, Xxxxxx X. Xxxxxx, Xxxxxx X. Xxxxxxx, or
Xxx Xxxxxx, officers of Melody, which execution of this Agreement must occur on
or before the date that is ten (10) days after the Effective Date.
[The remainder of this page is intentionally left blank.]
IN WITNESS WHEREOF, the Parties have entered into this Agreement as of the
date set forth hereinabove.
BUFFALO HIGHLANDS:
Buffalo Highlands, LLC, a Colorado limited liability
company
By: Hastings Holding Corporation, a Colorado
corporation, Manager of Buffalo Highlands, LLC
By: _______________________________
Xxxxxxx Xxxxxx, Vice President
By: Eagle Development Company, a Colorado
corporation, Manager of Buffalo Highlands, LLC
By:_______________________________
Xxxx X. Xxxxxxx, President
MELODY HOMES, INC.:
Melody Homes, Inc., a Delaware corporation
By:__________________________________
Xxxxx X. Xxxxx, Division President
CORPORATE APPROVAL:
By:___________________________________
Name:_________________________________
Title:__________________________________
Date:__________________________________
EXHIBIT A
Map of B.I. Property
EXHIBIT B
Consent to Partial Assignment
