Exhibit 2.2
CONTRACT OF SALE
Dated October 10, 1997
between
XXXXXX PALISADES ASSOCIATES
as Seller
and
HOME PROPERTIES OF NEW YORK, L.P.,
as Buyer
Affecting Premises Located in the Borough of Pleasant Hills,
County of Allegheny and the Commonwealth of Pennsylvania
Page 1
Table of Contents
Section Page
Included in Sale 1
Purchase Price 2
Permitted Encumbrances 4
Title Review 5
Apportionment 6
Assessments; Notices 7
Closing Costs 7
Date and Place of Closing 8
Delivery At Closing 8
Rent Roll 10
Buyer's/Seller's Representations 10
Bond Financing 12
Casualty; Condemnation 14
Buyer's Default 15
Seller's Default 15
Notices 15
Broker 16
Modifications 16
No Waiver 17
Governing Law/Waiver of Jury 17
Recordation 17
Seller's Obligations 17
Arms Length 17
Entire Agreement 17
Partial Invalidity 17
Headings 17
Counterparts 18
Cumulative Remedies 18
Attorneys' Fees 18
Survival 18
Assignment 18
Tax Deferred Exchange 18
Confidentiality 19
Financial Access 19
Certificate of Occupancy 19
Units Needing Substantial Repair/Renovation 19
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CONTRACT OF SALE
THIS CONTRACT OF SALE (this "Contract") made as of this 10th
day of October, 1997, by and between XXXXXX PALISADES ASSOCIATES,
a New York general partnership, having its principal office at
000 Xxx Xxxx Xxxxx Xxxx, Xxxxxxxxx, Xxx Xxxx 00000 ("Seller"),
and HOME PROPERTIES OF NEW YORK, L.P., a New York limited
partnership having its principal office at 000 Xxxxxxx Xxxxxx,
Xxxxxxxxx, Xxx Xxxx 00000 ("Buyer").
W I T N E S S E T H :
Seller agrees to sell and convey to Buyer, and Buyer agrees to
purchase from Seller, all those certain plots, pieces or parcels
of land with the buildings and improvements erected thereon,
situate, lying and being in the Borough of Pleasant Hills, County
of Allegheny and the Commonwealth of Pennsylvania, being more
particularly described in Exhibit A annexed hereto and made a
part hereof (hereinafter referred to as the " Premises"), all
upon and subject to the terms and conditions herein.
1. Included in Sale: This sale includes all of the
following which are applicable to the Premises (which, together
with the Premises, are hereinafter referred to as the
"Property"):
(a) All right, title and interest of Seller in and to
the buildings, structures and improvements located in, on or
under the Premises; and
(b) All right, title and interest of Seller, if any,
in and to any land lying in the bed of any street, road or avenue
opened or proposed, in front of or adjoining the Premises; and
(c) All right, title and interest of Seller in and to
all personal property, furniture, fixtures, vehicles, office
equipment, computer equipment, maintenance equipment and other
equipment set forth on Exhibit H attached hereto and made a part
hereof (hereinafter referred to as the "Personal Property"); and
(d) All right, title and interest of Seller in and to
all easements, rights-of-way, gores of land, passages, sewer
rights, waters, water courses, water rights and powers and all
estates, rights, titles, interests, privileges, liberties,
hereditaments and appurtenances of any nature whatsoever, in any
way belonging, relating or pertaining to the Premises;
(e) All security deposits held by Seller pursuant to
any leases with tenants at the Premises, now or hereafter made
pursuant to this Contract (such tenants being hereinafter
referred to as "Tenants" and such leases being hereinafter
referred to as
Page 1
"Tenant Leases") and any rents paid or payable pursuant to any
Tenant Leases for the period commencing with the "Closing Date"
(as hereinafter defined), subject, however, to the terms and
conditions hereof; and
(f) All right, title and interest of Seller in and to
all Tenant Leases, permits, certificates, consents, licenses and
concessions of or relating to the possession, use, occupancy or
enjoyment of all or any portion of the Premises, whether now
existing or hereafter made; and
(g) All right, title and interest of Seller in and to
any and all contracts and agreements, written or oral, expressed
or implied, now or hereafter entered into or arising, in
connection with any matter related to the Property including,
without limitation, any and all service contracts and repair
agreements and warranty and guaranty rights, if any; and
(h) All right, title and interest of Seller in and to
the trade name "Cloverleaf Village Apartments".
2. Purchase Price. The purchase price (hereinafter
referred to as the "Purchase Price") for the Property is Three
Million and % ($3,000,000.00) Dollars is payable as follows:
(a) Deposit. Upon the execution and delivery of this
Contract, Buyer shall make a deposit (the "Contract Deposit") in
the amount of One Hundred Thousand and % ($100,000.00) Dollars
with Lawyers Title Insurance Corporation, located at Xxx Xxxx
Xxxxxx, Xxxxx 0000, Xxxxx Xxxxxx, Xxx Xxxx 00000 (hereinafter
referred to as "Escrow Agent"). The Contract Deposit shall be
made by check made payable to Lawyers Title Insurance
Corporation, as Escrow Agent and shall be held in escrow by
Escrow Agent in a Federally insured, interest bearing account,
with interest payable to the party entitled to receive the
Contract Deposit pursuant to the terms of this Contract. The
Contract Deposit, together with all accrued interest thereon,
shall be applied to the Purchase Price at "Closing" (as
hereinafter defined) or if the Closing does not occur shall be
paid to Seller unless this Contract expressly provides that it
shall be paid to Buyer. If for any reason the Closing does not
occur and either party makes a written demand upon the Escrow
Agent for payment of the Contract Deposit, the Escrow Agent shall
give written notice to the other party of such demand. If the
Escrow Agent does not receive a written objection from the other
party to the proposed payment within ten (l0) days after the
giving of such notice, the Escrow Agent is hereby authorized to
make such payment. If the Escrow Agent does receive such written
objection within such ten (l0) day period or if for any other
reason the Escrow Agent in good faith shall elect not to make
such payment, the Escrow Agent shall continue to hold such amount
until otherwise directed by written instructions from the parties
to this Contract or disposition of the same has been directed by
a final, nonappealable court order or Escrow Agent may pay the
Contract Deposit into court in accordance with proper court
procedure. The parties acknowledge that the Escrow Agent is
acting solely as a stakeholder at their request and for their
convenience,
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that the Escrow Agent shall not be deemed to be the agent of
either of the parties, except as expressly set forth herein, and
that the Escrow Agent shall not be liable to either of the
parties for any act or omission on its part unless taken or
suffered in bad faith, in willful disregard of this Contract or
of any escrow agreement or involving gross negligence. Both
parties shall jointly and severally reimburse and indemnify
Escrow Agent harmless from and against any and all loss,
liability, costs and expenses, including without limitation,
reasonable attorneys' fees and expenses as a result of its
performance of its duties and obligations under this Contract.
Upon making the delivery of the Contract Deposit and interest
earned thereon in the manner provided in this Contract, Escrow
Agent shall have no further liability hereunder. The Escrow
Agent joins in the execution of this Contract solely for the
purpose of acknowledging receipt of the Contract Deposit and its
agreement to hold the same pursuant to the terms hereof.
Anything contained herein to the contrary notwithstanding, Escrow
Agent shall be free to represent Seller in any and all manner
regarding this Contract and/or any dispute or litigation arising
hereunder.
(b) Balance at Closing. The balance of the Purchase Price
shall be paid by Buyer at the Closing, subject to any credit
and/or prorations provided for in this Contract. Said payment
shall be made by certified or cashier's check payable to Seller
or by wire transfer to Seller's account(s) or at Seller's
direction to Escrow Agent, for the benefit of Seller and as agent
for Seller or as Seller may direct in writing.
3. Permitted Encumbrances. The Property shall be sold and
conveyed subject to the following encumbrances (hereinafter
referred to as the "Permitted Exceptions"):
(a) Any state of facts a survey and/or inspection of the
Property may show;
(b) All present and future laws, statutes, codes,
ordinances, rules, regulations, restrictions and orders affecting
the Property, including without limitation, all zoning and
building ordinances and regulations of the commonwealth, city,
town and/or village in which the Property is located;
(c) The lien of real estate taxes, assessments, water
charges, sewer rents and municipal charges subject to
apportionment as provided for herein;
(d) All covenants, restrictions, easements, reservations,
conditions, consents and agreements of record although Buyer
shall have the right to review the title to the Property pursuant
to paragraph 4 below, provided, however, Buyer shall not have the
right to raise an objection to title to any of those matters set
forth on Exhibit B attached hereto and made a part hereof unless
any of those matters materially interfere with the current use of
the Property, in which case the Buyer will have the right to
object to same in accordance with the terms and provisions of
paragraph 4(b) herein below, provided that such objections shall
be made no later than ten (10) days after receipt of the Title
Commitment (hereinafter defined);
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(e) All Tenant Leases, subleases, tenancies and rights of
occupancy affecting the Property, all as may be affected by any
rent laws, regulations, court rulings and court decisions; and to
the form of lease being used at the Property, it being understood
and agreed that such leases and tenancies may be terminated or
expire between the date hereof and the Closing because of
expiration, defaults, summary proceedings or for any other reason
whatsoever and Seller shall not be liable therefor;
(f) The rights, if any, relating to construction,
maintenance and operation of public utility lines, wires, poles,
cables, pipes, distributing boxes and other equipment and
installations on, over and under the Property;
(g) All violations of Federal, state and local laws,
ordinances, regulations, rules, orders or requirements according
to or issued by any governmental authority having jurisdiction
with respect to the Property;
(h) All maintenance, supply and service contracts set forth
on Exhibit C annexed hereto and made a part hereof and any and
all other such contracts and amendments, extensions or
modifications thereto which Seller may enter into in the ordinary
course of its business (collectively, the "Service Contracts"),
provided, however, Seller hereby agrees that there will be no
other Service Contracts which will continue in effect after
Closing except as set forth in Exhibit C, except Seller shall
have the right to enter into additional Service Contracts which
would bind Buyer if Seller obtains Buyer's prior consent, which
consent shall not be unreasonably withheld, denied, delayed or
conditioned; and
(i) Encroachments and/or projections of walls, foundations,
xxxxxx, cellar steps, areas, cornices, trim and/or other
improvements and/or installations onto the Property or from the
Property onto adjoining property; party walls and/or party wall
rights; variations between the record lot lines of the Property
and those shown on the tax map; and/or consents of record for the
erection and/or maintenance of any structures on, under or above
any streets or roads in front of or adjoining the Property.
4. Title Review.
(a) Buyer has the right to review title to the Property and
raise objections thereto (except as provided in paragraph 3(d)
above) during the ten (10) day period commencing on the date
Buyer receives the title insurance commitment with respect to the
Property, as discussed below. In the event Buyer wishes to raise
any objections to the title to the Property (except as provided
in paragraph 3(d) above), Buyer shall follow the procedure set
forth in Paragraph 4(b) below. In the event Buyer does not raise
any objections to the title to the Property within said ten (10)
day period, in accordance with paragraph 4(b) below, then Buyer
shall be deemed to have agreed to accept title to the Property in
the state as set forth in the title insurance commitment.
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(b) Buyer shall order, within five (5) days after the date
on which a fully executed counterpart of this Contract is
delivered to Buyer (hereinafter the "Effective Date"), a title
insurance commitment (the "Title Commitment") from a reputable
title insurance company licensed to do business in the
Commonwealth of Pennsylvania (hereinafter referred to as the
"Title Company") which shall commit to insure at Closing Buyer's
title to the Property. Buyer, within ten (10) days after receipt
of the Title Commitment, shall notify Seller in writing of any
objections as to the marketability of title matters reflected in
such Title Commitment (except any exceptions which are shown on
Exhibit B attached hereto, as provided in paragraph 3(d) above).
To the extent that Buyer does not furnish Seller with written
notice of objections to the Title Commitment, within ten (10)
days after receipt of the Title Commitment , Buyer shall be
deemed to have waived any such objections to the Title Commitment
and to the status of title of the Property. If Buyer shall
notify Seller in writing of any objections as to the
marketability of title as reflected in the Title Commitment
within such ten (10) day period , then Seller shall have the
right at its option to cure said objections or the right not to
cure said objections. Seller shall notify Buyer as to its
election within ten (10) days after receipt of Buyer's notice of
objections. If Seller shall elect not to cure said objections,
then Buyer shall have the right to elect either to accept title
subject to such objected items without any reduction in the
Purchase Price or to terminate this Contract. Buyer shall notify
Seller as to its election within seven (7) days of receipt of
Seller's notice to Buyer of its election not to cure said
objections. If Buyer shall fail to give Seller such notice of
Buyer's election either to accept title or to terminate this
Contract within the time specified, it shall be presumed
conclusively that Buyer has elected to accept title to the
Property subject to such objected items without any reduction in
the Purchase Price. If Buyer elects to terminate this Contract
within the time specified above, neither Buyer nor Seller shall
have any further liability hereunder (except as otherwise
expressly provided in this Contract), provided, however, Buyer
shall have the right to a return of the Contract Deposit and
Buyer shall be obligated to pay all charges relating to said
Title Commitment. In the event Seller elects to cure any
objections raised by Buyer concerning said Title Commitment,
Seller shall have a reasonable period of time within which to
cure such objections. After Buyer has approved the state of
title as per the above, Buyer shall have no right to object to
the state of title to the Property, except as to any encumbrances
on title which are caused by Seller between said time title was
so approved and the date of Closing and which render title to the
Property unmarketable.
5. Apportionment.
(a) The following are to be apportioned
as of midnight of the day prior to the Closing Date with respect
to the Property and shall serve to reduce or increase, as the
case may be, the cash to be paid at Closing:
(i) Real estate taxes, sewer rents, water charges and
similar charges (singularly "Imposition" and collectively
"Impositions") on the basis of the respective periods for which
the same are assessed. If the Closing shall occur before any
such Imposition has been fixed, apportionment of such Imposition
shall be based on the
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amount of the Imposition paid for the latest applicable period,
but shall be re-apportioned upon receipt of the applicable bills
therefor and upon demand of either party;
(ii) Utility charges, including without limitation,
water, gas, electrical and telephone services (to the extent not
paid by Tenants), shall be apportioned based on final meter
readings or bills, as the case may be. If the final meter
reading or xxxx for any utility charge has not been rendered for
the period in which the Closing Date occurs, such utility charges
shall be adjusted at Closing on the basis of the charges for the
most recent prior period, but shall be re-apportioned upon
receipt of the final meter readings or applicable utility bills
and upon the demand of either party;
(iii) Current accounts paid or payable under any
Service Contracts affecting the Property;
(iv) All rents actually collected under the Tenant
Leases for the month in which the Closing occurs. At Closing
Seller shall furnish to Buyer a schedule of all rents and other
charges which are then payable by Tenants of the Property, but
which have not been paid and collected as of the Closing Date.
Any such delinquent rents or charges collected by Buyer
subsequent to the Closing Date for the month in which the Closing
occurs (the "Closing Month") shall be pro-rated as of midnight of
the day prior to the Closing Date and the pro-rated share payable
to Seller shall be remitted to Seller promptly by Buyer, as
hereinafter provided. Until the closing, Seller may (but shall
not be required to) institute any action or proceeding against
any Tenant based upon any default or failure of such Tenant to
perform the terms, covenants or conditions of such Tenant's lease
or tenancy. With respect to any months other than the Closing
Month, if Buyer collects any such delinquent rents or charges
owed by a Tenant or Tenants, then, the first rentals and monies
received by Buyer (other than for the Closing Month) from such
Tenant or Tenants shall be applied first to pay the rent due for
the current month and any excess remaining shall be received in
trust by Buyer for the account of Seller in payment of such past
due rents or charges and shall be promptly remitted by Buyer to
Seller forthwith. Seller shall have the right subsequent to the
Closing to bring a legal proceeding against any Tenant to enforce
collection of past due rents owed to Seller by said Tenant and
Buyer shall make available to Seller all books and records
required therefor and shall otherwise cooperate with Seller in
connection therewith. All rent collected by Seller after Closing
for any rental periods applicable to any time after the Closing
shall belong to Buyer, and if paid to Seller, Seller shall
promptly send such rent to Buyer. The provisions of this
paragraph shall survive Closing.
(v) At closing, Seller will assign all security
deposits given by Tenants at the Property (including interest as
required under applicable law or Tenant Lease) to Buyer, or in
the alternative, at Seller's option, make an equivalent
adjustment to the cash payable at Closing, and Buyer shall
indemnify Seller from and against any and all claims made as a
result of any actions or omissions of Buyer with respect thereto.
Seller will not release any such security deposits in whole or in
part nor retain any security deposits as an
Page 6
offset against unpaid rent due from any Tenant unless the said
Tenant is no longer in possession of an apartment at the
Property; and
(vi) All wages of employees of Seller working at the
Property, if applicable.
(b) The obligation pursuant to this paragraph 5
to apportion or re-apportion any of the foregoing items at or
subsequent to the Closing shall survive the Closing for a period
of twelve (12) months. At the expiration of said twelve (12)
month period, unless either Seller or Buyer objects to an
apportionment or demands a re-apportionment within such twelve
(12) month period, all adjustments shall be deemed final.
6. Assessments; Notices. (a) If at the time of delivery
of the "Deed" (as hereinafter defined), the Property or any part
thereof shall be or shall have been affected by an assessment or
assessments which are or may become payable in annual
installments, then, for the purposes of this Contract, all unpaid
installments of any such assessment which are due and payable and
constitute a lien as of the Closing Date shall be paid and
discharged by Seller (subject to apportionment for the period in
which the Closing occurs) and all other unpaid installments of
any such assessment which are due and payable after the Closing
Date shall be the sole responsibility of Buyer.
7. Closing Costs. Seller shall pay at Closing one half (1/2)
of any and all transfer taxes levied or assessed against or upon
the conveyance of title to the Property. Buyer shall pay at
Closing one half (1/2) of any and all transfer tax levied or
assessed against or upon the conveyance of title to the Property
and all other costs in connection with this Contract, including
without limitation, the premiums and all other costs and expenses
charged by the Title Company for the issuance of the Title
Commitment and the title insurance policy to Buyer, any and all
survey costs and costs and expenses in connection with Buyer's
due diligence and other review of the Property. Buyer also shall
pay at Closing the recording fees for the Deed and all other
transfer documents. Except as otherwise expressly set forth
herein, each party shall pay their own respective fees and costs,
including attorney's fees and costs.
8. Date and Place of Closing. Settlement, the delivery of
the Deed and all other "Closing Documents" (as hereinafter
defined) in exchange for the Purchase Price and the closing of
title (herein referred to as the "Closing") shall take place in
escrow, by mail, at the office of the Escrow Agent on the Closing
Date. The Closing Date shall be on or before October 31, 1997,
however, Seller shall have the right in its sole discretion to
extend the Closing Date for a period not to exceed forty-five
(45) days on five (5) days prior written notice. Time shall be
of the essence as to the October 31, 1997 closing date, or if
Seller has so extended the closing date, time shall be of the
essence with respect to such extended closing date. At Closing,
the Escrow Agent shall release the Deed to Buyer for recordation
(or to the Title Company if Buyer so directs) upon Escrow Agent's
receipt of the Purchase Price in readily available Federal funds.
Page 7
9. Delivery At Closing.
(a) At the Closing, Seller shall deliver to Buyer all of
the following with respect to the Property (the "Closing
Documents"):
(i) A special warranty deed, in substantially the same
form as set forth in Exhibit D annexed hereto, conveying the
Property to Buyer subject to the Permitted Exceptions and those
exceptions listed on Schedule B of the Title Commitment which
have not been objected to by Buyer or which have been objected to
by Buyer and either been approved or, pursuant to the terms
hereof, deemed approved by Buyer pursuant to paragraph 4(b), or
cured by Seller (herein referred to as the "Deed");
(ii) A Xxxx of Sale conveying all Personal Property to
Buyer without recourse to Seller in substantially the same form
as set forth in Exhibit E annexed hereto;
(iii) An original executed Assignment and Assumption
of all Tenant Leases and security deposits made under the Tenant
Leases in substantially the same form as set forth in Exhibit I
attached hereto, provided Seller has not elected to make an
adjustment for the security deposits at Closing;
(iv) Notice to all Tenants of the Property, duly
executed by Seller, advising said Tenants of the sale of the
Property to Buyer and directing that all rents and other
payments, as of the Closing Date, be sent to Buyer (or, if Buyer
shall so direct, to Buyer's Agent) at the address to be provided
by Buyer;
(v) Seller's affidavit stating Seller's Federal
taxpayer identification number and certifying that Seller is not
a foreign person, corporation, partnership, trust or estate as
defined in the Internal Revenue Code and Regulations thereunder,
pursuant to the Foreign Investment in Real Property Tax Act of
1980;
(vi) Original executed counterpart of an Assignment
and Assumption of all Service Contracts in substantially the same
form as set forth in Exhibit I attached hereto;
(vii) An affidavit of the party executing the Deed on
behalf of Seller and an appropriate resolution or certificate of
Seller stating that Seller and any persons acting for or on
behalf of Seller are authorized and empowered to make this
Contract and to perform all obligations on Seller's part to be
performed hereunder and to convey title to the Property and to
execute, where necessary, and to deliver all of the Closing
Documents referenced herein to Buyer in accordance with the terms
and provisions of this Contract;
(viii) Properly executed transfer tax returns, to the
extent required;
(ix) Keys to the Property;
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(x) A current "Rent Roll" (as hereinafter defined) as
of the Closing; and
(xi) An original executed counterpart or (to the
extent lost or unavailable) an accurate and complete copy of each
one of the Tenant Leases, which shall be delivered to Buyer at
the Property.
(b) At the Closing, Buyer shall deliver to Seller all of
the following:
(i) Payment of the Purchase Price as required by and
as adjusted pursuant to the terms and provisions of this
Contract;
(ii) An affidavit of the party executing this Contract
on behalf of Buyer and an appropriate resolution or certificate
of Buyer, in form reasonably satisfactory to Seller, stating that
Buyer and any persons acting for or on behalf of Buyer are
authorized and empowered to make this Contract and to perform all
obligations on Buyer's part to be performed hereunder and to
execute, where necessary, and to deliver all of the Closing
Documents referenced herein in accordance with the terms and
provisions of this Contract;
(iii) Original executed counterpart of Assignment and
Assumption of all Tenant Leases and security deposits made under
the Tenant Leases if Seller has not elected to make an adjustment
for security deposits at Closing; and
(iv) Original executed counterpart of Assignment and
Assumption of all Service Contracts.
(c) It is understood and agreed that the Assignment and
Assumption Agreements referred to above in paragraphs 9(a)(iii),
9(a)(vi), 9(b)(iii) and 9(b)(iv) shall contain an indemnity
provision pursuant to which Seller will agree to indemnify Buyer
and hold Buyer harmless from and against any loss, cost,
liability or damages (including reasonable attorneys' fees) which
result from, arise out of or relate to (i) any claims arising out
of any of the Tenant Leases pertaining to any period prior to the
Closing Date or (ii) any claims arising out of any of the Service
Contracts pertaining to any period prior to the Closing Date,
respectively. Notwithstanding the foregoing, the parties hereto
hereby understand and agree that Buyer is purchasing the
Properties on an "as is" basis and therefore Seller's obligation
to indemnify and hold harmless Buyer, as hereinabove provided,
shall not include any claim, loss, cost, liability or damages
arising out of the condition of the Property (including without
limitation, the environmental condition of the Property) or any
portion thereof and that Buyer shall be responsible for all costs
of repair, maintenance, environmental clean-up and replacement of
the Properties and/or any portion thereof and shall not have any
claim against Seller in connection therewith.
(d) It is understood and agreed that the Assignment and
Assumption Agreements referred to above in paragraphs 9(a)(iii),
9(a)(vi), 9(b)(iii) and 9(b)(iv) shall contain an
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indemnity agreement pursuant to which Buyer will agree to
indemnify Seller and hold Seller harmless from and against any
loss, cost, liability or damages (including reasonable attorneys'
fees) which result from, arise out of or relate to (i) any claims
arising out of any of the Tenant Leases or security deposits
pertaining to any period after the Closing Date commencing with
the Closing Date or (ii) any claims arising out of any of the
Service Contracts pertaining to any period after the Closing Date
commencing with the Closing Date, respectively. Notwithstanding
the foregoing, the parties hereto hereby understand and agree
that Buyer is purchasing the Properties on an "as is" basis and
therefore Buyer shall indemnify and hold harmless Seller from and
against any claim, loss, cost, liability and/or damages arising
out of the condition of the Properties (including without
limitation, the environmental condition of the Property) and/or
any portion thereof regardless of when any such claim, loss,
cost, liability or damages arises on, prior to or after the
Closing Date.
10. Rent Roll.
Annexed hereto and made a part hereof as Exhibit F is a
complete and correct rent roll with respect to the Property
(herein referred to as the "Rent Roll") which sets forth: (i)
the name of each Tenant; (ii) each Tenant's apartment; (iii) the
current rent; (iv) the expiration date; (v) the rent actually
collected; and (vi) the security deposit. The Rent Roll to be
delivered to Buyer at the Closing will be made current as of the
Closing Date.
11. Buyer's/Seller's Representations. (a) Buyer hereby
warrants, represents and agrees that the following are true as of
the Effective Date and will be true on the Closing Date and shall
survive the Closing Date:
(i) Buyer is a duly organized and validly existing
limited partnership under the laws of the State of New York, has
all requisite power and authority to execute and deliver this
Contract and all other documents and instruments to be executed
and delivered by it hereunder, and to perform its obligations
hereunder and under such other documents and instruments in order
to consummate this Contract in accordance with the terms and
conditions hereof, and all necessary actions of the Buyer have
been taken to confer all necessary power and authority upon the
persons executing this Contract and all documents which are
contemplated by this Contract on behalf of Buyer, except that
Seller acknowledges that it is a condition of Buyer's obligations
hereunder that the Board of Directors of the general partner of
Buyer approve this Contract on or before October 31, 1997,
although it is understood and agreed that Buyer's sole right and
remedy in the event such approval is not obtained by such date
shall be the right to terminate this Contract and receive a
refund of the Contract Deposit; and
(ii) There is no litigation, action, proceeding or law
suit pending against Buyer which might adversely effect Buyer's
ability to consummate this Contract in accordance with the terms
and provisions hereof.
Page 10
(b) Seller represents and warrants to Buyer that to the
best of Seller's knowledge without any independent inquiry:
(i) There is no litigation, proceeding or
investigation pending or, to the best of Seller's knowledge,
threatened against or affecting the Property that might affect or
relate to the validity of this Contract, other than those fully
covered by insurance;
(ii) There is no pending condemnation of the Property
or any part thereof;
(iii) Until Closing, Seller shall make all reasonable
efforts not to default under it obligations under the terms of
the Tenant Leases encumbering the Property and under the Service
Contracts, subject to Seller's sole but reasonable discretion in
exercising its rights and remedies under the Tenant Leases and
Service Contracts and at law and in equity, and Seller shall
continue to operate the Property in a commercially reasonable
manner;
(iv) Seller shall permit Buyer to examine and copy all
of the leases encumbering the Property, including all additions,
amendments or modifications thereto as provided herein. Seller
shall not accept any prepayment of any rent due under any such
leases for a period greater than one (1) month in advance other
than security deposits;
(v) Seller has not received any written notice of any
violations of Federal, state and local laws, ordinances,
regulations, rules, orders or requirements according to or issued
by any governmental authority having jurisdiction with respect to
the Property.
(c) Irrespective of anything to the contrary contained
herein, the representations of Buyer and Seller herein contained
shall expire and be of no further effect upon the expiration of
six (6) months after Closing. This expiration shall not apply to
any breach of representation which arises out of an intentional,
material misrepresentation made by Buyer or Seller.
(d) The phrase "to the best of Seller knowledge" or its
equivalent shall be deemed to mean the personal and actual
knowledge of Xxxxxx Xxxxxxxx.
12. (a) Buyer is hereby granted a period commencing on the
Effective Date and terminating on October 14, 1997 (herein
referred to as the "Due Diligence Period") to inspect the
Property, at Buyer's sole cost and expense. Seller hereby
authorizes Buyer, upon reasonable notice and during reasonable
business hours and provided Buyer is accompanied at all times
with an authorized representative of Seller, to enter upon the
Property in order to inspect the same. If Buyer elects not to
acquire the Property pursuant to the terms and conditions hereof,
Buyer must notify Seller in writing prior to 5:00 PM on October
31, 1997 (the "Due Diligence Expiration Date"). If such written
notice is not delivered to Seller by Buyer prior to the Due
Diligence Expiration Date, Buyer shall be obligated to close the
transaction contemplated hereby pursuant to the terms and
conditions hereof, and shall have and shall be deemed to have
waived any and all rights to
Page 11
terminate this Contract pursuant to this paragraph. In the event
Buyer does timely notify Seller in writing that it has elected to
terminate this Contract, the Contract Deposit shall be returned
to Buyer and this Contract shall be deemed to be terminated and
neither party shall have any further rights against or
obligations to the other, except as otherwise expressly provided
in this Contract.
(b) It is expressly agreed and understood that Buyer is
purchasing the Property to be conveyed hereunder in its "as is"
condition as of the date hereof and with all faults and Buyer
hereby assumes the responsibility of all use, wear, tear and
deterioration between the date of this Contract and the date of
Closing, except that Seller shall continue to operate the
Property in accordance with its current standard practice. It is
understood and agreed that, except as specifically set forth in
paragraph 11(b) herein above, Seller is not making and
specifically disclaims any warranties or representations of any
kind or character, express or implied, with respect to the
Property, including, but not limited to, warranties or
representations as to matters of title, zoning, tax consequences,
bond financing, tax credits, physical or environmental
conditions, occupancy, availability of access, ingress or egress,
operating history or projections, valuation, governmental
approvals, governmental regulations or any other matter or thing
relating to or affecting the Property including, without
limitation: (i) the value, condition, merchantability,
marketability, profitability, suitability or fitness for a
particular use or purpose of the Property, and (ii) the manner,
quality, state of repair or lack of repair of the Property.
Buyer agrees that with respect to the Property, Buyer has not
relied upon and will not rely upon, either directly or
indirectly, any representation or warranty of Seller or any
agent, broker, employee, servant, representative or affiliate of
Seller. Buyer represents and warrants that it is a knowledgeable
buyer of property and that it is relying solely on its own
expertise and that of Buyer's consultants, and that Buyer shall
assume the risk that adverse matters, including, but not limited
to, adverse physical and environmental conditions, may not be
revealed by any inspections or investigations which Buyer may
perform. Buyer acknowledges and agrees that there are no oral
agreements, warranties or representations collateral to or
affecting the Property by Seller or any agent or affiliate of
Seller or any third party. Buyer expressly agrees that the terms
and conditions of this paragraph shall expressly survive the
Closing and not merge therein and Seller is not liable or bound
in any manner for any verbal or written statements,
representations or information pertaining to the Property
furnished by any agent, broker, employee, servant, representative
or affiliate of Seller or any other person.
(c) For and in consideration of the right to inspect the
Property, Buyer agrees to restore any and all damage to the
Property and/or any portion thereof caused by Buyer and/or
Buyer's agents, representatives, brokers, contractors,
subcontractors, employees and/or licensees and to indemnify,
defend and hold Seller harmless from and against any and all
suits, actions, proceedings, damages, losses, liabilities, liens,
repairs, fees, costs and expenses (including reasonable
attorneys' fees, costs and expenses) caused by Buyer or its
agents, representatives, brokers, contractors, subcontractors,
employees and/or licensees and/or arising out of and/or relating
to Buyer's (and/or Buyer's agents', representatives', brokers',
contractors', subcontractors', employees' and/or licensees')
inspection, activities
Page 12
and/or entrance on the Property. The aforesaid obligation to
restore and aforesaid indemnity shall survive the Closing or the
earlier termination of this Contract.
13. Condemnation/Casualty.
(a) Buyer shall have no right
to terminate this Contract in the event a casualty occurs, or in
the event of the institution of any proceedings, judicial,
administrative or otherwise, prior to Closing which shall relate
to the proposed taking of any portion of the Property by eminent
domain (or deed in lieu thereof), or in the event notice of such
proceeding is given before Closing, or in the event of the taking
of any portion of the Property by eminent domain (or deed in lieu
thereof), prior to Closing. In the event of any of the
foregoing, there shall be no reduction to the Purchase Price
payable by Buyer hereunder and Seller, at Closing, shall assign
and/or pay over to Buyer all proceeds and awards of such casualty
or taking which Seller received after the Effective Date, less
any amount which Seller may have been obligated to pay to any
lender holding a mortgage on the Property or any portion thereof
(to the extent such amount is not applied to reduction of loan
principal), for repairs or restoration of the damage and/or in
negotiating and obtaining the award or proceeds.
(b) Upon the expiration of the Due Diligence Period, Seller
shall not settle any claim with respect to any eminent domain
proceeding concerning the Property or any part thereof without
obtaining Buyer's prior written consent in each case, which
consent shall not be unreasonably withheld, denied or delayed.
(c) Seller hereby agrees to furnish Buyer with written
notification of any such eminent domain proceeding within five
(5) business days after receipt by Seller of notice of the same.
14. Buyer's Default. Should Buyer default in the
performance of (i) any of the terms of this Contract, except
under paragraph 32 hereof, Seller's sole remedy with respect
thereto shall be to receive immediately and retain the Contract
Deposit paid on account of this Contract, together with any and
all accrued interest thereon, as liquidated damages, whereupon
this Contract shall become null and void, neither party having
any further rights against the other, except as otherwise
expressly provided in this Contract, and/or (ii) any of the terms
of paragraph 32 of this Contract, Seller shall have the right to
receive immediately and retain the Contract Deposit together with
all interest earned thereon and in addition thereto shall have
the right to pursue any and all other rights and/or remedies
which Seller may have under this Contract, at law and/or in
equity, including without limitation, compensatory and
consequential damages. The foregoing notwithstanding, if Buyer's
default consists of any act or failure to act, Seller shall give
Buyer written notice describing such default and shall afford
Buyer ten (10) days to cure such default before availing itself
of Seller's remedy under this paragraph.
15. Seller's Default. Should Seller default in the
performance of any of the terms of this Contract, Buyer shall
have the right to terminate this Contract by giving written
notice of termination to Seller. If Buyer should elect to
terminate this Contract, the Contract Deposit, with any and all
accrued interest thereon, shall be immediately
Page 13
refunded to Buyer. The foregoing notwithstanding, if Seller's
default consists of any act or failure to act, Buyer shall give
Seller written notice describing such default and shall afford
Seller ten (10) days to cure such default before availing itself
of Buyer's remedies under this paragraph.
16. Notices. All notices given or required to be given
hereunder shall be deemed to be duly given only if sent by
registered or certified mail, return receipt requested and
deposited postage prepaid in a post office branch or box
regularly maintained or if sent by a reputable national overnight
service (for next day delivery) addressed to the parties at their
respective addresses set forth herein below or if sent by
facsimile transmission to the numbers indicated below:
If to Seller: Xxxxxxxx Development Corp.
000 Xxx Xxxx Xxxxx Xxxx
Xxxxxxxxx, Xxx Xxxx 00000
Attn: Xxxxxx Xxxxxxxx
Fax: (000) 000-0000
With a copy to: Xxxx X. Xxxxxxxx, Esq.
Xxxxxxxx & Xxxxxxx, P.C.
000 Xxx Xxxx Xxxxx Xxxx
Xxxxxxxxx, Xxx Xxxx 00000
Fax: (000) 000-0000
If to Buyer: Home Properties of New York, L.P.
000 Xxxxxxx Xxxxxx
Xxxxxxxxx, Xxx Xxxx 00000
Attn: Xxxxxxx X. Crossed
Fax: (000) 000-0000
With a copy to: Xxxxx X. Xxxxx, Esq.
Home Properties of New York, L.P.
000 Xxxxxxx Xxxxxx
Xxxxxxxxx, Xxx Xxxx 00000
Fax: (000) 000-0000
or to such other address as either party may designate in
accordance with this paragraph. Any such notice shall be deemed
effective on the earlier of receipt (with acknowledgment) or the
third business day after mailing or the next day after delivery
to such overnight service or, in the case of a facsimile
transmission, upon receipt of a statement indicating that the
transmission was successfully completed, except that any notice
of change of address shall be effective only upon actual receipt.
The attorney for each party shall have the power to give any
notice required or desired to be given under this Contract with
the same force and effect as if the same had been given by such
party.
Page 14
17. Broker.
(a) Each party hereto represents to the other
that it has had no dealings with any broker, agent or finder in
connection with this transaction.
(b) Buyer and Seller each represents and warrants to
the other that in the event any claim is made for a broker's
commission or finder's fee as a result of acts or actions of one
of them with respect to this transaction, the party because of
whose acts or actions such claim is made (hereinafter referred to
as the "Indemnitor"), its successor and assigns, hereby agrees to
indemnify, defend and hold harmless the other party (hereinafter
referred to as the "Indemnitee") from and against any and all
loss, cost, damage, liability or expense (including reasonable
attorney's fees and expenses) which Indemnitee may sustain, incur
or be exposed to by reason of any such claim. The provisions of
this subparagraph 17(b) shall survive the Closing or any earlier
termination of this Contract.
18. Modifications. This Contract may not be modified or
supplemented except by an instrument in writing signed by the
party to be charged or such party's attorney.
19. No Waiver. No waiver by either party of any failure or
refusal by the other party to comply with its obligations under
this Contract shall be valid unless in writing and signed by the
party to be charged or such party's attorney and no such waiver
shall be deemed a waiver of any other or subsequent failure or
refusal to so comply.
20. Governing Law/Waiver of Jury. This Contract and all
transactions contemplated by this Contract shall be governed by
and construed and enforced in accordance with the laws of the
State of New York without regard to principles of conflicts of
laws. Both Buyer and Seller hereby irrevocably waive all right
to trial by jury in any action, proceeding or counterclaim
arising out of or relating to this Contract.
21. Recordation. Buyer covenants and agrees that in no
event will Buyer record or cause to be recorded this Contract or
any memorandum thereof or any affidavit, assignment or other
document relating to this Contract and that if Buyer breaches the
provisions of this paragraph, Seller shall have the option of
terminating this Contract and retaining the Contract Deposit as
liquidated damages in addition to any other rights that Seller
may have.
22. Seller's Obligations: If Seller is unable to transfer
title to Buyer in accordance with this Contract, Seller's sole
obligation shall be to refund the Contract Deposit (or so much
thereof as has been deposited) to Buyer. After the Contract
Deposit (or so much thereof as has been deposited) is paid to
Buyer, neither party shall have any rights or obligations to the
other and this Contract shall be null and void, except as
otherwise expressly provided in this Contract.
23. Arms Length. This Contract and any exhibits hereto
have been negotiated at arms length by Seller and Buyer and the
parties hereto mutually agree that, for the purpose of construing
the terms of this Contract or any of the exhibits hereto, neither
party shall be deemed to have been responsible for the drafting
thereof.
Page 15
24. Entire Agreement. All prior understandings, agreements
and negotiations by and between the parties hereto are merged in
this Contract, which also constitutes the entire agreement of the
parties and shall inure to and bind the successors and permitted
assigns of the respective parties hereto.
25. Partial Invalidity. If any term or provision of this
Contract or the application thereof to any person or
circumstances shall, to any extent, be invalid or unenforceable,
the remainder of this Contract or the application of such term or
provision to persons or circumstances other than those as to
which it is held invalid or unenforceable, shall not be affected
thereby, and each term and provision of this Contract shall be
valid and enforceable to the fullest extent of the law.
26. Headings. The headings of the paragraphs of this
Contract have been inserted for convenience of reference only and
shall not constitute a part hereof.
27. Counterparts. This Contract may be signed by the
parties in counterparts, both of which, when taken together,
shall be deemed an original Contract.
28. Cumulative Remedies. Each and every of the rights,
benefits and remedies conferred by this Contract or any document
executed pursuant to this Contract, are cumulative and shall not
be exclusive of any other of said rights, remedies and benefits
allowed by law or equity to the parties, subject, however, to the
provisions of paragraphs 14 and 15 hereof.
29. Attorneys' Fees. Seller and Buyer agree that, in the
event of any litigation arising between the parties in connection
with this Contract, the losing party shall be responsible for
payment of the reasonable attorneys' fees of the successful party
(at trial and all appellate levels).
30. Survival. Buyer agrees that upon the delivery of the
Deed at Closing for the Properties, it shall be deemed and
considered as full compliance by Seller of all representations
and warranties made by Seller in this Contract, if any, and all
obligations and agreements by Seller to be performed unless
expressly stated herein to survive.
31. Assignment. This Contract may be assigned without the
consent of Seller to a single-purpose entity of which Buyer is
the general partner. This Contract otherwise may not be assigned
by Buyer without the consent of Seller. In the event of any
permitted assignment , the assignee must assume all of the
obligations and liabilities of Buyer hereunder and in no event
Buyer shall be released from any liability and/or obligations
hereunder.
32. Tax Deferred Exchange. Seller has advised Buyer of its
intention to seek to effect a tax deferred exchange pursuant to
Section 1031 of the Internal Revenue Code, in connection with the
conveyance of the Property (or any portion thereof). If Seller
is able
Page 16
to negotiate terms acceptable to Seller for the transfer or
acquisition of an exchange property or properties, then Buyer
agrees to accommodate Seller in seeking to effect a tax deferred
exchange for that property or properties. Seller shall have the
right, expressly reserved here, to transfer the Property (or any
portion thereof) in exchange for such exchange property or
exchange properties so identified by Seller so that Seller shall
become the owner of the exchange property or properties and the
owner of the exchange property or properties shall become the
owner of the Property (or any portion thereof) subject to all
obligations of Seller hereunder. The owner of the exchange
property then shall complete this Contract. In the alternative,
Buyer agrees to cooperate with Seller with respect to such
exchange and agrees to execute all documentation required to
effectuate such exchange, including, but not limited to, an
Exchange Trust Agreement, Designation of Exchange Property and
Notice of Assignment of Contract of Sale For Relinquished
Property in accordance with the forms as set forth in Exhibit G
annexed hereto and made a part hereof. Buyer makes no warranty
whatsoever with respect to the qualification of the transaction
for tax deferred exchange treatment under Section 1031 and Buyer
shall have no responsibility, obligation or liability with
respect to the tax consequences to Seller. Buyer's expenses with
respect to the conveyance of the Properties shall be limited to
the expenses as set forth in this Contract (although Buyer shall
be responsible for its own attorneys' fees and expenses). The
covenants and obligations contained in this Paragraph shall
survive the Closing. Notwithstanding the foregoing, Seller
agrees that the Deed conveying title to the Property from Seller
to Buyer shall be executed and delivered directly by Seller in
accordance with subparagraph 9(a)(i) herein above.
33. Confidentiality. By executing this Agreement and
except as otherwise provided herein, prior to Closing Seller
agrees to keep any and all information with respect to the
transactions contemplated under this Contract strictly
confidential, and will not disclose any such information without
the Buyer's prior written consent except as may be necessary to
satisfy Seller's obligations hereunder and/or to close the
transaction contemplated hereby.
34. Financial Access. Seller will certify to Seller that
its records accurately reflect the operation of the Property on a
cash basis. Such certification shall be in substantially the
same form as Exhibit J annexed hereto. Seller will provide
access by Buyer's representatives, upon reasonable notice and
during reasonable business hours to all financial and other
information relating to the Property as is sufficient to enable
them to prepare audited financial statements, at Buyer's expense,
in conformity with Regulation S-X of the Securities and Exchange
Commission (the "Commission") and any registration statement,
report or disclosure required to be filed with the Commission.
35. Certificate of Occupancy. To the extent that any state
or local laws or regulations require the issuance of a current
Certificate of Occupancy in connection with the transfer of the
Property, Seller shall use its reasonable best efforts to provide
an unconditional Certificate of Occupancy at Closing, provided
that Seller shall not be obligated to expend any sum in excess of
$100,000 in connection with the issuance of
Page 17
such Certificate of Occupancy. Seller shall have the right to
terminate this Contract if, in Seller's sole but reasonable
discretion, the cost to provide such Certificate of Occupancy
will exceed $100,000.00. The foregoing notwithstanding, Buyer
shall have the right (but not the obligation) to vitiate Seller's
termination of this Contract pursuant to this paragraph by giving
Seller written notice within five (5) days after Buyer's receipt
of Seller's notice of termination that Buyer agrees to accept
title to the Property without such Certificate of Occupancy, in
which event, Seller shall give Buyer at Closing a credit against
the Purchase Price in the amount of $100,000.00.
IN WITNESS WHEREOF, this Contract has been duly executed by
the parties hereto as of the day and year first above written.
SELLER:
XXXXXX PALISADES ASSOCIATES,
a New York general partnership
By:
/s/ Xxxxxx Xxxxxxxx
-----------------------------
Xxxxxx Xxxxxxxx, General Partner
BUYER:
HOME PROPERTIES OF NEW YORK,
L.P., a New York limited partnership
By: Home Properties of New York, Inc.,
its general partner
ATTEST
By: By:
/s/ Xxxxx X. Xxxxx /s/ Xxx X. XxXxxxxxx (Seal)
------------------ --------------------------------
Name:Xxxxx X. Xxxxx Xxx X. XxXxxxxxx
Title:Assistant Counsel Vice President
The undersigned has executed this Contract solely to acknowledge
receipt of the Contract Deposit and to confirm its acceptance of
the duties of Escrow Agent as set forth in paragraph 2(a) hereof.
Lawyers Title Insurance Corporation
By:
/s/ Xxxx Xxxxx
-------------------------------
Name: Xxxx Xxxxx
Title Senior Vice President
Page 18
