EXHIBIT 10.16
OPTION TO PURCHASE
THIS AGREEMENT, dated as of this 6 day of APRIL 1998, by and between
ANDRE VAN'T WESTEINDE, who resides at 0000 XXXXX'X XXXX, XXXXXX, Xxxxx,
(hereinafter referred to as "Seller") and LANSTAR SEMICONDUCTOR, INC., a
UTAH corporation with its principal place of business at 00000 Xxxxx Xxxx,
Xxxxxx, Xxxxx 00000, and/or assigns (hereinafter referred to as
"Purchaser").
The parties hereto hereby agree as follows:
1. GRANT OF OPTION.
1.01 In consideration of the execution of that certain Modification of
Commercial Lease Agreement dated contemporaneously herewith by Purchaser as
Tenant of a building situated on the below-described real estate, together with
TEN DOLLARS ($10.00) in hand paid by Purchaser to Seller, and other good
valuable consideration reflected herein, all of which is acknowledged by Seller,
Seller hereby grants and conveys to Purchaser an irrevocable and exclusive
option, upon the terms and conditions hereinafter set forth, to purchase that
certain real property located in the City of FARMERS BRANCH , Dallas County,
State of Texas, consisting of all of the following:
A. The land, together with the improvements located thereon and all and
singular the tenements, hereditaments and appurtenances thereunto belonging
or in anywise appertaining, now or hereafter erected on said plot, piece or
parcel of land more particularly described in Exhibit A annexed hereto and
made a part hereof (hereinafter referred to as the Exhibit A Tract). This
sale includes all right, title and interest of Seller, in and to any land
lying in the bed of any street, road or avenue, opened or proposed, in
front of or adjoining said Exhibit A Tract, to the center line thereof, and
all right, title and interest of Seller in and to any award made or to be
made in lieu thereof and in and to any unpaid award for damage to the
Exhibit A Tract and improvements by reason of change of grade of any
street;
B. All improvements on the Exhibit A Tract including a commercial building
having approximately 38,000 square feet, with such fixtures and equipment
in place and warranties on such fixtures and equipment as exist and
enforceable on the closing date; and
C. All of Seller's right, title and interest to any leases and rental
agreements with tenants for the Exhibit A Tract and Improvements
(hereinafter collectively called the "Leases"),
OPTION TO PURCHASE Page 1
and any prepaid rents and security deposits held by Seller or its agents in
connection with said Leases, if any.
1.02 To exercise this option, Purchaser must give written notice of its
election to purchase the Exhibit A Tract executed by Purchaser, in the form
required for notices under Article 11, hereof, to Seller at Seller's address set
forth in said Article (the "Notice of Election") in the amount of TEN THOUSAND
DOLLARS ($10,000) provided with such notice, Purchaser's check payable to the
order of the title insurance company named herein, as escrow agent, to be held
in escrow in accordance with the provisions of Paragraph 3 below. To be
effective, the Notice of Election and check for deposit in escrow must be given
no later than October 30, 1998.
1.03 If Purchaser does not exercise this option on or before the Option
Expiration Date in accordance with the provisions of this Agreement, this
Agreement and all rights of Purchaser hereunder shall terminate, and neither
party shall have any further claim against the other arising out of this Option
Agreement and Purchaser shall have no further claim as to the EXHIBIT A TRACT;
provided, however, Purchaser's failure to exercise this option shall not
constitute a breach of the Lease as modified by and between the Landlord and
Tenant.
1.04 If Purchaser does exercise this option in accordance with this
Agreement, the parties shall close title to the EXHIBIT A TRACT pursuant to the
following provisions of this Agreement. The Exhibit A Tract shall be sold and
conveyed subject only to (i) the covenants, conditions, restrictions, rights-of-
way and easements reflected in the commitment for Title Insurance as its
standard exceptions, (ii) liens or claims created by or resulting from Tenant's
possession and/or use of the property, (iii) any liens created in connection
with purchase of the property, and (iv) other liens and/or encumbrances approved
by Purchaser in writing prior to the closing (collectively the "Permitted
Exceptions").
2. PURCHASE PRICE.
2.01 The purchase price for the Exhibit A Tract shall be TWO MILLION
($2,000,000 U.S.).
2.02 The purchase price shall be payable to Seller by Purchaser in cash
at the closing.
OPTION TO PURCHASE Page 2
3. THE CLOSING. The consummation of the transactions provided for in this
Agreement (the "Closing") shall take place at any mutually agreeable hour, or if
the Seller and Purchaser are unable to agree on such hour, then at 2:00 p.m. on
a business day to be selected by Seller and Purchaser, subsequent to Purchaser's
delivery of the Notice of Election, but not later than December 31, 1998,
(hereinafter referred to as the "Closing Date) at CHICAGO TITLE INS., CO., 0000
XXXXXXX XXXXX, XXX. 000, XXXXXXXXXX, XX, provided that if on such date the title
company has not yet approved title or if there are title objections which have
not yet been cured, the Closing Date shall be postponed not less that five (5)
nor more than thirty (30) days to such date as shall be mutually agreed by
Seller and by Purchaser.
4. REPRESENTATIONS AND WARRANTIES OF SELLER.
4.01 Seller, to induce Purchaser to enter into this Agreement, to
exercise the option granted hereunder and to purchase the EXHIBIT A TRACT,
represents and warrants to Purchaser as follows:
A. Seller has no knowledge of any existing or threatened action,
condemnation, highway relocation or change in grade suit or proceeding
affecting the Exhibit A Tract or any portion thereof or relating to, or
arising out of the ownership, of the EXHIBIT A TRACT, in any court or
before or by any federal, state, county or municipal department,
commission, board, bureau or agency or other governmental instrumentality,
save and except the claims of the Purchaser as Tenant, under the existing
Commercial Lease Agreement, as modified on this date;
B. This Agreement has been duly executed by and on behalf of Seller, and
constitutes the Seller's valid and binding agreement, enforceable in
accordance with the terms hereof; and
C. The improvements to the Exhibit A Tract is insured for its full value
of $2,000,000 under that certain all risks policy attached hereto as
Exhibit B, and within fifteen (15) days of the execution of this Option to
Purchase Agreement, shall cause Purchaser to be named as an additional
insured, and to continue such insurance coverage until the earlier of (i)
expiration of the option period, the option not being exercised, or (ii)
the closing date. PURCHASER (TENANT) AGREES TO PAY INCREASE IN PREMIUM OVER
PRESENT POLICY OF $1,000,000.00.
D. Seller agrees that until the earlier of the expiration of the
option, the option not being exercised, or the closing, that Seller shall
(i) perform all obligations arising under the leases referred to
hereinabove, (ii) maintain the property
OPTION TO PURCHASE Page 3
in good repair and in the same condition, reasonably wear and tear accepted
as of the time this Option to Purchase Agreement is executed, and (iii)
continue to operate and manage said property in a reasonable, diligent and
prudent manner; provided, however, so long as the Purchaser, as Tenant, is
in possession of the property, the Seller shall not enter into any
additional leases, licenses or agreements pertaining to the property prior
to the earlier of the expiration of the option period, the option not being
exercised, or the closing date.
4.02 Notwithstanding Purchaser's exercise of the option granted and
conveyed hereunder, it shall be a condition of Purchaser's obligation to
consummate the sale herein provided for, that all of the warranties and
representations of Seller herein contained shall be true both at the time the
same are made and as of the Closing Date; provided Purchaser shall be entitled,
in its sole discretion, to waive the foregoing condition with respect to one or
more of such warranties and representations; and those not so waived shall
survive the closing of title and delivery of the deed as hereinafter set forth.
5. REPRESENTATIONS AND WARRANTIES OF PURCHASE
Purchaser represents and warrants to Seller that:
5.01 Purchaser has full power, in accordance with law, to enter into this
Agreement and to carry out the transactions provided for herein.
5.02 This Agreement has been duly executed by Purchaser, and is a valid
and binding agreement of Purchaser, enforceable in accordance with the terms
hereof.
5.03 In entering into this Agreement, Purchaser has not been induced by
and has not relied upon any representations, warranties or statements, whether
oral or written or express or implied, made by Seller or by any broker or any
other person representing or purporting to represent Seller, which are not
expressly set forth in this Option Agreement and the other agreements by,
between and among the Seller, Purchaser and others executed contemporaneously
herewith, whether or not any such representations, warranties or statements were
made in writing or orally.
6. PRE-CLOSING COVENANTS OF SELLER.
Seller covenants and agrees and it shall be a condition of Purchaser's
obligation to consummate the transaction herein
OPTION TO PURCHASE Page 4
provided for that all of such covenants shall be performed) that subsequent to
the date hereof and until the Closing Date:
A. Seller, if it contemplates taking any action to withdraw, settle or
otherwise compromise any protest or reduction proceeding affecting real
estate taxes assessed against the EXHIBIT A TRACT for any fiscal period
after 1996, during the term of this option shall give Purchaser written
notice of such intention thirty (30) days prior to taking such action.
7. CONDITION OF TITLE-TITLE INSURANCE.
7.01 Seller agrees to make, promptly after the receipt of Purchaser's
Notice of Election in exercise of the option granted and conveyed hereunder,
application for a title insurance fee owner's policy to be issued to Purchaser,
and in connection with the issuance of such title policy, to cause title to the
EXHIBIT A TRACT to be searched and examined by CHICAGO TITLE INS. CO.
(hereinafter the "Title Insurance Company") and to deliver to the Purchaser,
copies of the title insurance Company's report, and the tax search. The title
insurance policy to be issued at Closing shall carry only the standard
exceptions and exceptions regarding Permitted Encumbrances. The title insurance
policy, however, will have all standard provisions regarding insuring the
boundary lines deleted and will issue such in accordance with the survey.
7.02 On the Closing Date Seller will convey to Purchaser good and
marketable title to the EXHIBIT A TRACT, free and clear of any and all
encumbrances, covenants, conditions and restrictions other than the Permitted
Encumbrances, which shall not be deemed to be title defects. Seller agrees not,
either voluntarily or by agreement, to consent, prior to the Option Expiration
Date, to the imposition of a matter constituting an encumbrance on the title to
the property. If Seller shall be unable to convey title in accordance with the
terms of this Agreement, Purchaser shall have the option to accept title subject
to such objections.
7.03 Seller shall pay the costs of examination of title and of an owner's
policy of title insurance to be issued insuring the Purchaser's title to the
EXHIBIT A TRACT to the amount of the Purchase Price, and shall pay as well as
all other title charges, notary fees, and any and all other costs or expenses
incident to recordation of documents required in order to transfer title.
Purchaser shall pay for the costs of the survey and any inspections required by
Purchaser. Each party shall pay its own attorneys' fees in connection herewith.
7.04 Seller and Purchaser agree that any and all 1998 or 1999 municipal,
County, State or other accrued but unpaid property taxes, transfer taxes and
filing fees on the deed to be executed,
OPTION TO PURCHASE Page 5
delivered and recorded pursuant hereto to the extent same may be required to be
paid in connection with the closing of title hereunder, shall be pro-rated and
paid on the Closing Date by Seller, Purchaser and Purchaser's assigns, if any,
based on the date of sale.
8. DELIVERIES AT CLOSING.
8.01 On the Closing Date, the Seller shall deliver to the Purchaser or
its designee the following:
A. A general warranty deed for the EXHIBIT A TRACT and Improvements, duly
executed and acknowledged by the Seller and in proper form for recording,
subject only to the Permitted Encumbrances, if any. Acceptance of such deed
by the Purchaser shall be deemed full and complete performance on the part
of Seller hereunder with respect to condition of title;
B. Seller's certification that all of the representations and warranties
of Seller, contained in this Agreement are true and correct as of the
Closing Date and there exist no conditions which upon notice or the passage
of time or both would constitute default by Seller under this Agreement;
C. All such further conveyances, assignments, confirmations,
satisfactions, releases, powers of attorney, instruments of further
assurance, approvals, consents, and any and all such further instruments
and documents as may be reasonably necessary, expedient or proper in the
opinion of Purchaser, in order to complete any and all conveyances,
transfers, sales and assignments herein provided for; and
It is understood that Seller's delivery of the foregoing documents named in this
Section constitute conditions Purchaser's obligation to close title.
8.02 On the Closing Date the Purchaser shall deliver to Seller:
A. The Purchase Price in the form of the escrowed sum plus cash for a
total of TWO MILLION DOLLARS ($2,000,000).
B. Such other and further documents as may be reasonably required by
Seller or the Title Insurance Company to consummate the transaction
contemplated herein.
9. BROKERAGE.
9.01 The Seller shall pay any and all commissions due to properly
licensed real estate brokers as a result of the
OPTION TO PURCHASE Page 6
consummation of the sale of the Exhibit A Tract to Purchaser or its assigns.
9.02 Each party shall indemnify and hold the other free and harmless from
and against all claims for brokerage commissions or fees or finder's fees by any
person or entity claiming (i) to have been retained by the maker of this
indemnity in connection with this transaction or the EXHIBIT A TRACT or (ii) to
be the procuring cause of this transaction.
10. EXPENSES. Except as otherwise provided in this Agreement, each party hereto
will bear and pay its own expenses of negotiating and consummating the
transaction contemplated hereby.
11. NOTICES. All notices and other communications under this Agreement shall be
in writing and shall be sent by registered, or certified mail, return receipt
requested, postage prepaid, addressed as follows: if intended for the Seller, to
the Seller named and at the address reflected hereinabove, and if intended for
the Purchaser, to the Purchaser named and at the address reflected hereinabove
or at such address, and to the attention of such person, of which the Seller or
the Purchaser shall have given notice as herein provided. Any such notice or
other communication shall be deemed to have been sufficiently given for all
purposes hereof on the day following the date on which the same is deposited in
a general of branch post office or mail box maintained by the Postal Service.
12. BINDING EFFECT. This Agreement shall be binding upon the parties hereof,
their respective successors and assigns.
13. GOVERNING LAW. The terms and provisions of this Agreement shall be governed
by the law of the State of Texas pertaining to agreements made and performed
entirely within such State.
14. ENTIRE AGREEMENT. The Agreement, together with the schedules, exhibits and
other documents referred to herein or executed contemporaneously, contain the
entire agreement of the parties with respect to the subject transactions and
supersede all other or prior agreements oral or in writing, and may not be
amended, modified, released or discharged in whole or in part except by an
instrument in writing and signed by both parties, and then only to the extent
set forth in such instrument.
15. ASSIGNMENT. The Purchaser shall be free to assign its rights and
obligations under this contract so long as the ASSIGNEE is a corporate entity
which Purchaser controls through majority ownership and by common officers. Any
Such assignee shall assume all of the Purchaser's obligations hereunder and in
such event the Purchaser shall thereafter have no further obligations hereunder.
OPTION TO PURCHASE Page 7
The Purchaser shall promptly notify the Seller upon the Purchaser making any
such assignment and the Purchaser shall deliver to the Seller a counterpart of
the instrument of assignment and assumption, which shall constitute an
assignment of all of Purchaser's interest hereunder, and upon such delivery,
such assignment shall be effective against Seller. Upon any such assignment, the
Purchaser shall not be liable hereunder. The term "Purchaser" shall be deemed to
include the assignee under any such effective assignment.
16. PARTIAL INVALIDITY. In the event any one or more of the provisions
contained in this Option Agreement shall for any reason be held to be invalid,
illegal or unenforceable in any respect, such invalidity, illegality or
unenforceability shall not affect any other provision of this Agreement, but
this Agreement shall be construed as if such invalid, illegal or unenforceable
provision had never been contained herein.
17. DEFAULTS:
A. DEFAULT BY SELLER. In the event of default by the Seller, the Purchaser
may, at Purchaser's option, elect to enforce the terms of this Option
Agreement, if it is duly exercised by the Purchaser, or the Purchaser may
terminate this option, even if exercised, and receive a full refund of the
Purchaser's deposit.
B. DEFAULT BY PURCHASER. In an event of default by the Purchaser, the
Seller may, at the Seller's option, elect to enforce the terms of this
Option Agreement, if it is duly and properly exercised by the Purchaser, or
declare forfeiture under this Option Agreement and retain the escrow
deposit as a full and complete payment of its' damages, the amount of
escrow being considered liquidated damages for the purposes of the Seller's
recovery of its damages.
OPTION TO PURCHASE Page 8
18. CAPTIONS. The section headings in this Agreement are intended for
convenience of reference only and shall not govern the interpretation or meaning
of any section of this Agreement.
IN WITNESS WHEREOF, the parties have executed his Option to Purchase
Agreement as of the day and year first above written.
SELLER:
By: /s/ XXXXXX VAN'T WESTEINDE
----------------------------------------------------
XXXXXX VAN'T WESTEINDE
PURCHASER:
LANSTAR SEMICONDUCTOR, INC.
By: /s/ XXXXX X. XXXXX
----------------------------------------------------
XXXXX X. XXXXX
PRESIDENT/CEO
PRINCIPAL BROKER:
XXXXXXXX COMPANIES
By: /s/ ILLEGIBLE
----------------------------------------------------
COOPERATING BROKER:
XXXXX X. XXXXXX COMMERCIAL
By: /s/ XXXXXX ILLEGIBLE
----------------------------------------------------
BUY ACKNOWLEDGES AND AGREES THE PROPERTY WILL BE SOLD AND CONVEYED TO BUYER ON
AN "AS IS" BASIS, WITH NO WARRANTY OF HABITABILITY, MERCHANTABILITY, CONDITION,
OR FITNESS, OR OF ANY OTHER KIND WHATEVER EXCEPT AS SET FORTH HEREIN.
OPTION TO PURCHASE Page 9
STATE OF TEXAS (S)
(S)
COUNTY OF DALLAS (S)
BEFORE ME, the undersigned authority, on this day personally appeared ANDRE
VAN'T WESTEINDE acknowledged to me that he has executed the same for the
purposes and considerations therein expressed and in the capacity herein stated.
GIVEN UNDER MY HAND AND SEAL OF OFFICE this the 6th day of April 1998.
/s/ XXX X. XXXXXX
----------------------------------------------------
Notary Public in and for
the State of T E X A S
My commission expires: [NOTARY STAMP APPEARS HERE]
XXX X. XXXXXX
NOTARY PUBLIC
STATE OF TEXAS
COMM. XXX. 00-00-00
XXXXX XX XXXXX (S)
(S)
COUNTY OF DALLAS (S)
BEFORE ME, the undersigned authority, on this day personally appeared XXXXX
X. XXXXX, known to me to be the Chief Executive Officer of LANSTAR
SEMICONDUCTOR, INC., a Texas corporation, and acknowledged to me that he has
executed the same for the purposes and considerations therein expressed and in
the capacity herein stated.
GIVEN UNDER MY HAND AND SEAL OF OFFICE this the 6th day of April 1998.
/s/ XXX X. XXXXXX
----------------------------------------------------
Notary Public in and for
the State of T E X A S
My commission expires: [NOTARY STAMP APPEARS HERE]
XXX X. XXXXXX
NOTARY PUBLIC
STATE OF TEXAS
COMM. EXP. 02-24-99
OPTION TO PURCHASE Page 10
VERIFICATION
------------
STATE OF TEXAS (S)
(S)
COUNTY OF DALLAS (S)
BEFORE ME, undersigned notary public, on this day personally appeared
[ILLEGIBLE], known to me to be the person whose name is subscribed to the
-----------
foregoing instrument, and acknowledged to me that he/she executed the same for
the purposes and consideration therein expressed.
SUBSCRIBED AND SWORN to before me this 7th day of April, 1998, to certify
which witness my hand and seal of office.
/s/ XXXX XXXXXXX
----------------------------------------------------
Notary Public in and for
the State of T E X A S
My commission expires: [NOTARY STAMP APPEARS HERE]
XXXX XXXXXXX
NOTARY PUBLIC
STATE OF TEXAS
COMM. EXP. 04-09-2000
VERIFICATION
------------
STATE OF TEXAS (S)
(S)
COUNTY OF DALLAS (S)
BEFORE ME the undersigned notary public, on this day personally appeared
XXXXXX [ILLEGIBLE], known to me to be person whose name is subscribed to the
------------------
foregoing instrument, and acknowledged to me that he/she executed the same for
the purposes and consideration therein expressed.
SUBSCRIBED AND SWORN to before me this 7th day of April, 1998, to certify
which witness my hand and seal of office.
/s/ XXXX XXXXXXX
----------------------------------------------------
Notary Public in and for
the State of T E X A S
My commission expires: [NOTARY STAMP APPEARS HERE]
XXXX XXXXXXX
NOTARY PUBLIC
STATE OF TEXAS
COMM. EXP. 04-09-2000
EXHIBIT A
---------
BEING a tract of land situated in the METROPOLITAN BUSINESS PARK, SECTION
ONE, an Addition to the City of Farmers Branch, Texas, according to the Plat
thereof recorded in Volume 68194, Page 1210, of the Map Records of Dallas
County, Texas, and being more particularly described by mates and bounds as
follows:
BEGINNING at a point that is North 524.11 feet from the intersection of the
North line of Alpha Road (a 60.0 foot wide street) and the West line of Gamma
Road (a 60.0 foot wide street), said point being in the West line of Gamma Road;
THENCE West for a distance of 240.00 feet to a point for corner;
THENCE North for a distance of 300.00 feet to a point for corner;
THENCE East for a distance of 240.00 fact to a point for Corner in the West
line of. Gamma Road;
THENCE South for a distance of 300.00 feet along said West line of Gamma
Road to the PLACE OF BEGINNING.
CONTAINING 72,000 square feet or 1-6529 acres of land.
