CONTRACT OF SALE
BETWEEN
WOODWINDS, LTD., as Seller
AND
XXXXXX RESIDENTIAL PROPERTIES, INC., as Buyer
TABLE OF CONTENTS
1. Purchase Price. . . . . . . . . . . . . . . . . . . . . . .1
2. Intentionally Deleted . . . . . . . . . . . . . . . . . . .2
3. Independent Contract Consideration. . . . . . . . . . . . .2
4. Title Insurance . . . . . . . . . . . . . . . . . . . . . .2
5. Survey. . . . . . . . . . . . . . . . . . . . . . . . . . .4
6. Prorations and Closing Costs. . . . . . . . . . . . . . . .5
7. Closing . . . . . . . . . . . . . . . . . . . . . . . . . .5
8. Buyer's Remedies. . . . . . . . . . . . . . . . . . . . . .6
9. Seller's Remedy . . . . . . . . . . . . . . . . . . . . . .7
10. Intentionally Deleted . . . . . . . . . . . . . . . . . . .7
11. Seller's Representations and Warranties . . . . . . . . . .7
12. Seller's Covenants. . . . . . . . . . . . . . . . . . . . 10
13. Conditions Precedent to Buyer's Obligations . . . . . . . 10
14. Assignment. . . . . . . . . . . . . . . . . . . . . . . . 11
15. Intentionally Deleted . . . . . . . . . . . . . . . . . . 12
16. Inspection Period . . . . . . . . . . . . . . . . . . . . 12
17. Time Extensions . . . . . . . . . . . . . . . . . . . . . 13
18. Notices . . . . . . . . . . . . . . . . . . . . . . . . . 13
19. Performance . . . . . . . . . . . . . . . . . . . . . . . 15
20. Binding Effect. . . . . . . . . . . . . . . . . . . . . . 15
21. Entire Agreement. . . . . . . . . . . . . . . . . . . . . 15
22. Attorneys' Fees . . . . . . . . . . . . . . . . . . . . . 15
23. Survival. . . . . . . . . . . . . . . . . . . . . . . . . 16
24. Holidays, Etc.. . . . . . . . . . . . . . . . . . . . . . 16
25. Governing Law . . . . . . . . . . . . . . . . . . . . . . 16
26. Risk of Loss; Condemnation. . . . . . . . . . . . . . . . 16
27. Headings. . . . . . . . . . . . . . . . . . . . . . . . . 16
28. Effective Date. . . . . . . . . . . . . . . . . . . . . . 17
EXHIBIT A - THE LAND
EXHIBIT B - SURVEYOR'S CERTIFICATE
EXHIBIT C - NON-FOREIGN AFFIDAVIT
CONTRACT OF SALE
This Contract of Sale (this Contract) is between WOODWINDS,
LTD. (Seller) and XXXXXX RESIDENTIAL PROPERTIES, INC. (Buyer).
BACKGROUND
A. Seller is the owner of that certain tract of land
(Land) located in Davidson County, Tennessee, more particularly
described on Exhibit A attached hereto and made a part hereof.
B. Buyer wants to purchase the Land, together with all of
the improvements located thereon, and all personal property,
appurtenant interests, all tenant leases and related rights to
monies due thereunder and deposits held by Seller, all of
Seller's right, title and interest, if any, in and to (A)
warranties covering the personal property and the improvements,
(B) the trademarks or tradenames used by Seller in connection
with the Property, including, but not limited to, "Brandywine
Apartments", (C) the service contracts (and any deposits
thereunder) related to the operation and maintenance of the
improvements (to the extent assignable and not terminated by
Seller prior to Closing as directed by Buyer), (D) all licenses,
permits, approvals and other intangible property rights relating
to the Property and (E) all utility, security and other deposits.
and all related rights and appurtenances, including, without
limitation, Seller's interest in adjacent streets, alleys,
rights-of-way, strips, gores, and access easements, and any
improvements located on the Land (the Land and related rights,
appurtenances, and improvements are collectively referred to as
the Property).
AGREEMENT
Seller shall sell the Property to Buyer and Buyer shall
purchase the Property from Seller upon the following terms:
1. Purchase Price
The purchase price of the Property (the Purchase Price) is
$8,760,000 payable in cash at Closing, together with all closing
costs (the Closing Costs) related to the transaction contemplated
hereby (collectively, the Base Amount); provided, however, that
in the event that the amount required by Lender to repay in full
the indebtedness (the Existing Indebtedness) payable by Seller
and secured by the Property, together with the Closing Costs
(collectively, the Increased Amount), exceeds the Base Amount,
upon approval of the Increased Amount by Buyer in its sole
discretion, the Purchase Price shall be equal to the New Payoff
Amount. In the event that Buyer does not approve the Increased
Amount, this Contract shall be terminable by Buyer at Buyer's
option.
2. Intentionally Deleted.
3. Independent Contract Consideration
Buyer tenders to Seller and Seller acknowledges receipt of the
sum of ONE HUNDRED DOLLARS ($100.00) as independent and
nonrefundable contract consideration for the Inspection Period
(as defined in Paragraph 16). This independent consideration is
in addition to any other deposits made under this Contract.
4. Title Insurance
a. Seller, at Seller's expense, shall furnish to Buyer at
Closing a Tennessee Standard Form of Owner Policy of
Title Insurance (the Owner Policy) covering the
Property issued by Chicago Title Insurance Company
(Underwriter), through its agent, Safeco Land Title of
Dallas (Title Company), 0000 Xxx Xxxxxx, Xxxxx 0000,
Xxxxxx, Xxxxx, Attention: L. Xxxxx Xxxx, Phone: (214)
573-2250, dated as of the Closing Date, in the amount
of the Purchase Price, and containing no exceptions or
conditions except as follows:
the restrictive covenants exception must be
deleted or must state "None of Record except..."
and then must list only specific restrictive
covenants approved by Buyer;
the survey exception must be amended to read
"shortages in area";
stand-by fees, taxes, and assessments for the year
of Closing and subsequent years, and subsequent
assessments for prior years due to change in land
usage or ownership; and
any other Permitted Exceptions (as defined below
in this Paragraph).
b. Seller, at Seller's expense, shall furnish to Buyer a
title insurance commitment covering the Property issued
by Title Company (the Commitment), together with
legible and complete copies of all documents referenced
as title exceptions in the Commitment.
c. Buyer shall have until five (5) days prior to Closing
to object to any exception, condition or matter
unacceptable to Buyer in the Commitment or on the
Survey by giving notice to Seller. If Buyer does not
give notice of any such objections to Seller within
such period, Buyer is deemed to approve the title to
the Property as shown in the Commitment as well as
matters shown on the Survey.
d. Seller has 5 days after receipt of Buyer's notice to
cure Buyer's objections.
e. If Buyer gives notice of any objections within the
15-day period and Seller does not cure any of Buyer's
objections within Seller's 5-day cure period, Buyer
may, on or before the fifth (5th) day after the last
day of Seller's 5-day cure period, as Buyer's sole and
exclusive remedy, waiving all other remedies, either:
terminate this Contract by notice to Seller
whereupon the parties thereafter have no further
rights, liabilities, or obligations under this
Contract; or
waive its objections to the Commitment and the
Survey and accept Seller's title as shown in the
Commitment and on the Survey.
f. The exceptions to title listed in Schedule B of the
Commitment that are either accepted or waived by Buyer
are the Permitted Exceptions. No item listed in
Schedule C of the Commitment shall be a Permitted
Exception.
g. Seller may not further encumber the title to the
Property after the Effective Date without the prior
written consent of Buyer, in Buyer's sole discretion.
h. If any additional title encumbrances are discovered
after Title Company's issuance of the Commitment, Buyer
has the same rights concerning objections to the
additional title encumbrances as are provided above in
this Paragraph.
5. Survey
Seller, at Seller's expense, shall furnish to Buyer and the Title
Company within 10 days after the Effective Date five (5) copies
of a current survey of the Land (the Survey) certified to Seller,
Buyer, Underwriter, Title Company, and Buyer's lender by a
surveyor licensed in the State of Tennessee and selected by Buyer
showing:
a correct legal description of the Property by plat
reference, if applicable, and a metes and bounds
description of the Land with a point of commencement at
the intersection of two platted streets and the
recording data for the streets shown on the Survey and
with adjoinder calls to common property lines or right-of-way
lines and reference made to the recorded deed or plat;
the area, boundaries, and dimensions of the Land;
any encroachments or protrusions;
the location of all easements, known proposed
easements, apparent easements, and building
restrictions affecting the Land;
the location and dimensions of any improvements on the
Land;
the gross square footage of the Land and the square
footage of the Land net of areas lying within any
existing or proposed right-of-way of any highway, road,
street, alley, or railroad, or within the boundaries of
any conservation or drainage easements, any easements
not located in the boundaries of any building setback
lines, encroachments, waterways, or areas designated by
the Federal Emergency Management Agency as being within
the 100-year flood plain;
the approximate centerline of any springs or streams on
the Land and, if visible, the location of where they
enter or exit the surface of the Land; and
any waterways and any other areas on the Land
designated by the Federal Emergency Management Agency
(or other appropriate agency) as being within the
100-year flood plain.
The form of certificate to be used on the Survey is attached to
this Contract as Exhibit B.
6. Prorations and Closing Costs
a. Ad valorem taxes against the Property will be prorated
at Closing as of the Closing Date based on the tax
bills for the year of Closing. Seller shall pay to
Buyer at Closing the portion of the taxes on the
Property from the beginning of the current year through
the Closing Date. If Closing occurs before the current
year's tax bills are available, the proration will be
based on the latest tax rate applied to the latest
assessed valuation; then, after the taxes for the
current year are finally assessed, upon written demand,
Buyer shall refund to Seller any amount overpaid by
Seller or Seller shall pay to Buyer the amount of any
deficiency in the proration.
b. All closing costs other than as specified above, or as
may be specifically allocated elsewhere in this
Contract, will be allocated to Seller and Buyer in the
customary manner for the sale and purchase of
unimproved real property in Davidson County, Tennessee,
as of the Closing Date; provided, each party shall pay
its own attorneys' fees except in the event of
litigation.
7. Closing
a. The "Closing" of this Contract will occur in Title
Company's offices at 10:30 a.m., Dallas, Texas time, on
or before the fifth (5th) day after the last day of the
Inspection Period (the Closing Date).
b. At the Closing:
(i) Buyer must pay to Seller the Purchase Price; and
(ii) Seller must deliver to Buyer:
a special warranty deed in form acceptable to
Buyer conveying the Property to Buyer and
containing no exceptions or conditions except
the Permitted Exceptions (excluding the
standard printed exceptions in the Owner
Policy);
a xxxx of sale and assignment in form
acceptable to Buyer conveying the personal
property and all other intangibles to Buyer
and containing no exceptions or conditions
except the Permitted Exceptions (excluding
the standard printed exceptions in the Owner
Policy);
an assignment of tenant leases in form
acceptable to Buyer conveying to Buyer all of
the tenant leases and rights appurtenant
thereto affecting the Property;
the Owner Policy (or Buyer, in its sole
discretion, may waive issuance of the Owner
Policy and receive a credit against the
Purchase Price equal to the amount of
premiums Seller would have paid for the Owner
Policy);
a Non-Foreign Affidavit in substantially the
form attached to this Contract as Exhibit C;
a certificate that Seller's representations
and warranties continue to be true and
correct as of the Closing Date;
any other documents deemed necessary by the
Title Company or Buyer's counsel; and
exclusive possession of the Property.
8. Buyer's Remedies
If Seller does not perform its obligations under this Contract,
Buyer may, at its option, either:
enforce specific performance; or
terminate this Contract.
If Buyer terminates this Contract due to Seller's default, Seller
shall reimburse Buyer upon demand for all reasonable
out-of-pocket expenses incurred by Buyer in connection with this
transaction, and the parties thereafter have no further rights,
liabilities, or obligations under this Contract.
9. Seller's Remedy
If Buyer does not perform its obligations under this Contract for
any reason except the termination of this Contract pursuant to an
applicable provision of this Contract, Seller's exclusive remedy,
waiving all other remedies, is to terminate this Contract. If
Seller terminates this Contract, the parties thereafter have no
further rights, liabilities, or obligations under this Contract.
10. Intentionally Deleted
11. Seller's Representations and Warranties
Seller represents and warrants to Buyer as follows (which
representations and warranties are also deemed made by Seller to
Buyer at Closing and survive Closing):
a. Seller has good and indefeasible title to the Property
subject only to the Permitted Exceptions.
b. There are no parties in possession of any portion of
the Property as lessees, tenants at sufferance, or
trespassers. No leases, other than the leases for
apartments, affect the Property.
c. There is no pending or, to the knowledge of Seller,
threatened condemnation or similar proceeding or
special assessment (inclusive of assessments for street
widening, repair, or improvement), or change in zoning
affecting the Property.
d. The location, occupancy, operation, and use of the
Property do not violate any applicable federal, state,
county or city statute, ordinance, code, rule, or
regulation.
e. Seller has received no notice concerning the Property
from any Governmental Authority (as defined below in
this Paragraph) about a violation of any federal,
state, county, or city statute, ordinance, code, rule,
or regulation or stating that any investigation has
commenced or is contemplated regarding any violation.
f. There is no pending or, to Seller's knowledge,
threatened litigation or administrative proceeding
affecting Seller or the Property.
g. Seller has obtained all necessary consents and
approvals from any person, entity, or Governmental
Authority required for the execution and delivery of
this Contract by Seller and the performance by Seller
of its obligations under this Contract.
h. The execution and delivery of, and Seller's performance
under, this Contract are within Seller's powers and
have been duly authorized by all requisite actions.
This Contract constitutes a binding obligation of
Seller enforceable in accordance with its terms.
i. Performance of this Contract by Seller will not result
in any default under, or result in the imposition of
any lien or encumbrance upon the Property under, any
contract or other agreement that affects Seller or the
Property.
j. There are no attachments, executions, assignments for
the benefit of creditors, or voluntary or involuntary
proceedings in bankruptcy or under other debtor relief
laws contemplated by, pending, or threatened against
Seller.
k. Seller has not entered into, and has no knowledge of,
any contracts or other agreements with any private
party or Governmental Authority affecting the Property,
including, without limitation, any that require the
owner of the Property to install, maintain, construct,
or otherwise participate in or contribute to any
installation, maintenance, or construction of any
offsite improvements serving or intended to serve any
portion of the Property.
l. No portion of the Property has been established or
dedicated as park land, historical site, drainage
easement, conservation area, or open space and no
portion of the Property has been designated by Seller
or any Governmental Authority as a jogging, bicycle, or
other public pathway.
m. No tax liens or judgments affect the Property.
n. There are no unpaid charges, debts, liabilities,
claims, or obligations arising from the ownership or
operation of the Property that could give rise to any
mechanics' or materialman's or other statutory liens
against the Property or for which Buyer will be
responsible.
o. The Property has access to and from dedicated and
accepted public highways, streets, or roads. There is
no pending or, to Seller's knowledge, threatened action
by any Governmental Authority to limit or terminate
that access.
p. The Property is served at its perimeter with, and has a
right of access to without payment of any fees other
than normal tap fees, water, gas, electricity, waste
water, storm water, cable television, and telephone
services. There is no pending or, to Seller's
knowledge, threatened action by any Governmental
Authority or utility company that would limit or
terminate any utility service to the Property.
q. The Property has not been used for the disposal or
dumping of nor has there been any spillage, seepage, or
uncontrolled loss on or filtration from or onto the
Property of any "hazardous substances" or "hazardous
wastes", and the Property contains no such "hazardous
substances" or "hazardous wastes", as those terms are
defined in the Comprehensive Environment Response,
Compensation, and Liability Act of 1980, the Resource
Conservation and Recovery Act of 1976 (RCRA) the
Superfund Amendments and Reauthorization Act of 1986,
the Clean Water Act, the Federal Water Pollution
Control Act, the Federal Environmental Pesticides Act,
and similar State and local regulations and codes, all
as amended, and all rules and regulations applicable to
each.
r. There are no underground storage tanks (as defined in
RCRA) located in, on, under, or, to Seller's knowledge,
adjacent to the Property. Seller has no reason to
believe and does not believe that any hazardous wastes
or hazardous materials have seeped or flowed onto or
into the Property from other sites or from the Property
onto or into any other sites.
s. The Land is currently zoned for "___________" uses
under the applicable zoning ordinances of the
applicable local authority (the City).
The terms "Governmental Authority" and "Governmental Authorities"
mean the United States of America, the State of Tennessee,
Davidson County, the City, and any other political subdivision in
which the Property is located or which exercises jurisdiction
over the Property, and any agency, department, commission, board,
bureau, property owners association, utility district, flood
control district, improvement district, or similar district, or
other instrumentality of any of them.
12. Seller's Covenants
Seller shall, at Seller's sole cost and expense:
a. Promptly advise Buyer in writing of any litigation or
hearing or notice received or any material changes of
facts that cause any of Seller's representations or
warranties to be inaccurate in any respect.
b. Not take any action or omit to take any action that
could have the effect of violating any representations,
warranties, or agreements of Seller in this Contract.
c. Deliver to Buyer within 10 days after the Effective
Date copies of all tax statements for the Property,
including those for 1993, 1994, and 1995 relating to
personal and ad valorem taxes and special assessments,
correspondence with Governmental Authorities (including
any condemnation notices, proceedings or awards), soils
reports, environmental studies, surveys, plats, site
plans, elevations, topographical maps, engineering
studies, traffic studies, and other studies and reports
in Seller's possession concerning the Property.
d. Keep the terms of this Contract and the identity of
Buyer confidential. Seller may not issue or comment on
any press releases or news reports of this transaction
without Buyer's prior approval.
e. From the Effective Date until the Closing, maintain the
Property in good condition and repair.
13. Conditions Precedent to Buyer's Obligations
Buyer is not obligated to close this transaction, if at the time
of Closing, any of Seller's representations and warranties are
not true and correct in all respects, or Seller refuses to
execute and deliver to Buyer a certificate stating they are true
and correct in all material respects or Seller has not performed
all of its covenants under this Contract.
Buyer may, at Buyer's sole option, waive all or any of these
conditions precedent. If any condition precedent is not
satisfied by Closing, or any earlier time frame specified above,
then Buyer, at its sole option, may terminate this Contract on or
before the Closing Date by giving notice to Seller.
Upon termination, the the parties thereafter have no further
rights, obligations, or liabilities under this Contract. If
Buyer is entitled to terminate this Contract because a condition
precedent is not satisfied, Buyer does not terminate this
Contract, and the Closing occurs, then Buyer is deemed to waive
the respective condition if Buyer had actual knowledge the
condition precedent was not satisfied.
14. Assignment
Buyer may not assign this Contract without Seller's consent
except to an affiliate of Buyer. Upon any permitted assignment,
the assignee shall assume, and Buyer shall be released from,
Buyer's obligations under this Contract.
15. Intentionally deleted.
16. Inspection Period
a. Commencing on the Effective Date and continuing through
the 120th day after the Effective Date (the Inspection
Period), Buyer may, but is not obligated to, inspect
the Property and all of Seller's books and records
concerning the Property, review and analyze all
materials, surveys, maps, reports, and other matters
and information provided pursuant to this Contract,
together with any other materials, surveys, maps,
reports, studies, and other matters it may choose, in
its sole and absolute discretion.
b. Buyer may, for any reason whatsoever, or for no reason
at all, in Buyer's sole discretion, terminate this
Contract by notifying Seller of Buyer's election to
terminate under this Paragraph no later than 5:00 p.m.,
Dallas, Texas time, on the last day of the Inspection
Period.
c. If Buyer timely terminates this Contract under this
Paragraph, the parties thereafter have no further
rights, liabilities, or obligations under this
Contract.
d. If Buyer does not notify Seller in writing of Buyer's
election to terminate this Contract under this
Paragraph by 5:00 p.m., Dallas, Texas time, on the last
day of the Inspection Period, Buyer is deemed to waive
its right to terminate this Contract under this
Paragraph.
e. Seller grants to Buyer, its agents, contractors and
employees, a license, terminable only upon the
termination of this Contract, to inspect all of
Seller's books and records concerning the Property and
to enter upon the Property to make all studies and
inspections deemed necessary or desirable by Buyer.
Buyer's performance of all studies and tests is at its
sole risk and expense.
f. If the Property is damaged by Buyer or Buyer's agents
or contractors during Buyer's inspections, Buyer shall:
repair and restore the Property to substantially
the same condition as existed prior to conducting
the studies and tests; and
hold Seller harmless from any actual damages
(Seller waives any right to collect consequential
or punitive damages) arising solely and directly
from the actions of Buyer, its agents,
contractors, or employees, in conducting the
studies or tests.
g. Buyer has no liability to Seller for any reduction in
value to the Property that results from the discovery
of matters or circumstances through Buyer's studies and
tests.
17. Time Extensions
If Seller does not provide the Commitment, the Survey, or the
documents listed in Paragraph 12(c) to Buyer within the
respective time frames set forth in Paragraphs 4, 5 and 12, the
time periods for Seller to provide those items are extended until
Seller provides each of the items to Buyer and the expiration
date of the Inspection Period and the Closing Date are
automatically extended for like periods of time.
18. Notices
All notices, requests, approvals, and other communications
required or permitted to be delivered under this Contract must be
in writing and are effective:
on the business day sent if sent by telecopier prior to
5:00 p.m., Dallas, Texas time, and the sending
telecopier generates a written confirmation of sending;
upon receipt if delivered personally or by any method
other than by telecopier transmission (with written
confirmation), or by any method other than by mail;
1 day after delivery to a nationally recognized,
overnight courier service; or
if orderly delivery of the mail is not then disrupted
or threatened in which event some method of delivery
other than the mail must be used, 3 days after being
deposited in the United States mail, certified, return
receipt requested, postage prepaid;
in each instance addressed to Seller or Buyer, as the case may
be, at the following addresses, or to any other address either
party may designate by notice to the other party:
Seller: Woodwinds, Ltd.
c/x Xxxxxx Management Company
0000 XXX Xxxxxxx, Xxxxx 000, XX 00
Xxxxxx, Xxxxx 00000
escription of the subject property.
9. This survey was actually made on the ground as per record
description furnished by the title insurance company and is
true and correct.
10. This survey is conforms with the
_________________________________.
EXHIBIT C - NON-FOREIGN AFFIDAVIT
SUBJECT PROPERTY: See Exhibit A attached hereto.
SELLER: , a
Buyer: ______________________, a
_________________
Section 1445 of the Internal Revenue Code provides that a
transferee of a U.S. real property interest must withhold tax if
the transferror is a foreign person. To inform Buyer that the
withholding of tax is not required upon the disposition of a U.S.
real property interest by Seller, the undersigned hereby certify
the following on behalf of Seller:
1. Seller is not a foreign corporation, foreign
partnership, foreign trust, or foreign estate (as those
terms are defined in the Internal Revenue Code and Income
Tax Regulations);
2. Seller's U.S. employer identification number is
_____________________.
3. Seller's office address is:
Seller understands that this certification may be disclosed
to the Internal Revenue Service by Buyer and that any false
statement contained herein could be punished by fine,
imprisonment, or both.
Under penalties of perjury, I declare that I have examined
this certification and to the best of my knowledge and belief, it
is true, correct, and complete, and I further declare that I have
authority to sign this document on behalf of Seller.
, a
By:
Name:
Title:
SWORN TO AND SUBSCRIBED before me, the undersigned
authority, by _________________, __________________ of
_____________________, a __________________ on this _________
day of ____________________, 199__.
Notary Public, State of Texas
