PURCHASE CONTRACT
THIS AGREEMENT made and entered into this 31st day of October 1997 (the
"Effective Date"), between CORNERSTONE REALTY GROUP, INC. or its nominee,
(hereinafter called "Purchaser") and COPPER CROSSING INVESTORS, LTD., a Texas
Limited Partnership, (hereinafter called "Seller").
ARTICLE I
THE PROPERTY
1.1 SALE OF PROPERTY. Seller agrees to sell and convey, and Purchaser
agrees to purchase, Seller's real property known as COPPER CROSSING APARTMENTS
located in FORT WORTH, TX, with all buildings and improvements located thereon,
as more particularly described in the attached legal description in EXHIBIT A
including, but not limited to 200 individually heated and air conditioned
apartment units, with all appurtenances, together with all appliances, drapes,
carpeting, shrubbery and all other personal property used in connection with the
premises, including, the inventory of personal property to be supplied by Seller
and attached hereto as EXHIBIT B (all such real and personal property
hereinafter collectively referred to as the "Property" unless the context
clearly indicates otherwise).
ARTICLE II
PAYMENT OF PURCHASE PRICE
2.1 PURCHASE PRICE. The total purchase price shall be FOUR MILLION SEVEN
HUNDRED FIFTY THOUSAND ($4,750,000) DOLLARS as evidenced by cash or cash
equivalent at closing.
2.2 DEPOSIT. ONE HUNDRED THOUSAND ($100,000) DOLLARS to be placed in escrow
at the end of the "Inspection Period" described in Article VI below. Said
deposit shall be placed in escrow with commonwealth Land Title Insurance
Corporation or its authorized agent (the "Title Company") , Attention: Xx.
Xxxxxxx Xxxxxx, as an xxxxxxx money deposit which may be credited against the
purchase price or applied as per Article XI below.
2.3 INDEPENDENT CONTRACT CONSIDERATION. Purchaser shall, concurrently with
its execution hereof, deliver to Seller a check in the amount of FIFTY ($50)
DOLLARS (the "Independent Contract Consideration"), which amount Seller and
Purchaser agree has been bargained for as consideration for Seller's execution
and delivery of this Contract and Purchaser's right to inspect the Property. The
Independent Contract Consideration is in addition to
and independent of any other consideration or payment provided for in this
contract and is non-refundable in all events.
ARTICLE III
TITLE MATTERS
3.1 TITLE. Seller, shall convey good and indefeasible title by Special
Warranty Deed in the form attached hereto as EXHIBIT C, subject only to a lien
for general taxes for the current year not yet due and payable and utility
easements which do not interfere with the present use of the Property, and the
"Permitted Exceptions". "Permitted Exceptions" are those title exceptions listed
in the title commitment, which are not objected to pursuant to section 3.2
below.
(A) Title shall be free from any and all liens or mortgages and Seller
shall be responsible for any prepayment penalties necessary to deliver such free
title.
3.2 TITLE DEFECTS; ELECTION TO CURE. Seller shall furnish to Purchaser at
Seller's expense a commitment for Title Insurance from the Title Company, (the
"Commitment" or the "Title Report") within ten (10) days after the Effective
Date, covering the Property binding the Title Company to issue a Texas owner
Policy of Title Insurance (the "Title Policy") on the standard form prescribed
by the Texas State Board of Insurance at the Closing, in the full amount of the
Purchase Price, insuring Purchaser's fee simple title to the Property to be good
and indefeasible, together with true and correct copies of all instruments
listed on Schedule B to the Commitment (as well as any other documents or
instruments listed therein which will not be released at closing). If the title
commitment shows any exceptions, which are not acceptable to Purchaser in
Purchaser's sole discretion, Purchaser shall give written notice of such defects
in title to Seller's counsel during the Inspection Period. Seller may, at its
option, elect whether to cure said defects or by written notice to Purchaser
indicate its intention not to cure.
3.3 ELECTION NOT TO CURE DEFECTS. Should Seller elect not to cure title
defects, this Agreement, at Purchaser's option (exercised within five (5) days
of the notice by Seller that it will not cure the objections), shall be void;
each party shall thereupon be released from all obligations hereunder; and all
deposits shall be immediately returned to Purchaser.
3.4 SURVEY. As soon as reasonably possible, and in any event within ten
(10) days after the Effective Date , Seller shall, at Seller's expense, deliver
or cause to be delivered to the Seller, the Title Company, and to Purchaser a
current or updated on-the-ground perimeter survey (the "Survey") of the Property
prepared by a Registered Professional Land Surveyor reasonably
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acceptable to the Purchaser. The Survey shall show the location and size of all
of the following on or adjacent to the Property, if any:
buildings, buildings lines, improvements, streets, pavements,
easements, rights-of-way, protrusions, encroachments, fences, 100-year
flood plain, apparent public utilities, and recording information of
easements.
The Survey shall show the gross land area and the Net Land Area. The Survey
shall be in a form and of a date acceptable to Purchaser and to the Title
Company, and in acceptable form in order to allow the Title company to delete
the survey exception from the Title Policy. The term "Net Land Area" means the
gross land area of the Property less the land area included in utility
easements, drainage easements, ingress/egress easements, rights-of-way, 100-year
flood plain and encroachments on or across the Property. The area within the
100-year flood plain shall be as defined by the Federal Emergency Management
Agency or other applicable governmental authority. Anything to the contrary
notwithstanding, it shall be sufficient that the survey shows the gross area.
3.5 The Survey shall show no encroachments onto the Land from any adjacent
property, no non-insurable encroachments by or from the Land onto adjacent
property and no non-insurable violation of or encroachments upon any recorded
building lines, restrictions or easements affecting the Property. If the Survey
discloses any such encroachment or violation, seller shall have thirty (30) days
from the date of delivery of the Survey (with a commensurate extension of the
closing date) to have the Title Insurer issue its endorsement insuring against
damage caused by such encroachment or violation and to provide evidence thereof
to Purchaser, and if Seller fails to or is unable to have the same insured
against within such thirty (30) day period, Purchaser may elect, on or before
the expiration of the Inspection Period, to (i) terminate this Agreement (in
which case the Xxxxxxx Money shall be returned to Purchaser) and neither party
shall have any further liability or obligation to the other hereunder, or (ii)
accept the property subject to any such encroachment or violation, as "Permitted
Exceptions". If closing does not take place, the Purchaser agrees to pay
one-half (1/2) of the cost of the Survey ($1,500) so long as closing is not
aborted as a result of a title or Survey defect.
3.6 Purchaser agrees to deliver to Seller, within the Inspection Period,
notice as to which items on the title report or the Survey are objectionable.
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ARTICLE IV
PRORATIONS
4.1 INCOME AND EXPENSE ALLOCATIONS. The following shall be prorated, on a
calendar-month basis, to the day of the closing, rents and other income from the
Property; operating expenses (on such service contracts and other obligations as
Purchaser may agree to assume); and general and real property taxes and personal
and business property taxes for the year of closing (based on the most recent
assessment and the most recent levy).
4.2 CLOSING-COSTS. Purchaser and Seller shall pay their customary share of
all taxes, recording fees, if any, imposed on the Deed, or any other documents
executed in connection with the transfer of the Property. Seller agrees to pay
cost of title insurance. Seller shall pay any prepayment penalty charged by the
holders of any existing notes.
4.3 ALLOCATION OF RENTS. Rents collected by Seller prior to Closing shall
be prorated as agreed in 4.1 above. Purchaser shall apply rents received after
Closing first to payment of the current rent due to Purchaser, then to
delinquent rents due to Purchaser, and last to rents due to Seller as of the
Closing but uncollected prior to settlement. Purchaser agrees to use its best
efforts in good faith to collect the amount of any rental arrears from tenants
and Purchaser agrees to remit promptly to Seller any such arrears actually paid
by such tenants to Purchaser. Seller shall retain the right to commence legal
action against a tenant for any delinquent rent apportioned to the Seller.
4.4 PRIOR LEASE CONCESSIONS. If Seller has committed to give any future
monetary concessions to tenants under existing leases to which Purchaser would
become liable, then Seller shall pay to Purchaser said amount in a lump sum at
closing.
ARTICLE V
POSSESSION OF THE PROPERTY
5.1 POSSESSION. Possession of the Property shall be delivered to Purchaser
at closing, subject to the rights of the tenants under existing leases and
rental agreements.
ARTICLE VI
CONDITIONS PRECEDENT TO CLOSING
6.1 CONDITIONS PRECEDENT. Purchaser's obligation to purchase shall be
subject to and contingent upon the satisfaction of the following conditions
precedent:
(A) Receipt by Purchaser of an engineering report
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of building and site conditions, satisfactory to Purchaser in its sole
discretion, said report to include in part, a description of any hazardous waste
sites, hazardous wastes and/or hazardous materials af fecting the property.
Purchaser shall have fifteen (15) days in which to review the reports set forth
herein and exercise its right to reject the Property based thereon or the right
hereunder shall be deemed waived.
(B) The receipt by Purchaser of Seller documents described in 7.2
below.
(C) On the condition that Sellers representations and warranties
described in Article VIII below remain true and correct.
(D) On the condition that there have been no material or adverse
changes to the property or leases.
(E) Seller acknowledges that Purchaser is a public entity and that it
is required to furnish financial statements to the Securities and Exchange
Commission in connection with this acquisition. Seller agrees to make the
information available for Purchaser to audit the last 12 months of operation of
the Property so that a report can be generated that is in compliance with
accounting Regulation S-X of the Securities and Exchange Commission.
(F) Purchaser determining during the Inspection Period that all water,
sewer, gas, electric, telephone, and drainage facilities and all other utilities
required by law or by the normal use and operation of the Property are and at
the time of closing will be installed to the property line, are and at the time
of closing will be connected pursuant to valid permits, and are and at the time
of closing will be adequate to service the Property and to permit full
compliance with all requirements of law and normal usage of the Property by the
tenants thereof and their licensees and invitees.
6.2 INSPECTION. This Agreement shall be further subject to and contingent
upon Purchaser's satisfactory inspection as follows herein below.
6.2.1 PREPARATION FOR INSPECTION. At the execution of this Agreement,
Seller shall deliver to Purchaser copies of the following: (The Inspection
Period shall be extended as a result of any delays by Seller in producing the
items requested herein unless the Seller does not have them and notifies
Purchaser with an extension of time to reflect delays of notification.) The
current rent roll for the Property; detailed statements of income and expenses
with respect to the Property for the past two years; the most recent tax bills
for the Property; utility bills for the Property for the twelve (12) months
previous to the date hereof;
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all contract, mortgages, and other documents creating liens of security interest
on the Property, or any part thereof and all promissory notes secured thereby;
all insurance policies applicable to the Property to include loss runs for the
last three (3) years; Plans and Specifications for the Property, service
contracts, Certificates of occupancy, to the extent reasonably available; a copy
of title policy (together with true and correct copies of the instruments listed
thereon which evidence exceptions to title, except those which will be released
at and as a condition of closing) and most recent survey for the Property. A
copy of any environmental or engineering reports on the property. All these
items shall be certified by Seller to be accurate and complete to the best of
its knowledge and belief.
6.2.2 INSPECTION OF BOOKS AND RECORDS; ACCESS. Upon receipt by Purchaser of
all documents requested in the paragraph above, Purchaser, its employees, agents
and contractors shall have twenty-one (21) days (the "Inspection Period", as the
same may be extended) to enter upon the Property (subject to the rights of the
tenants) during normal business hours for the purpose of making physical
inspections thereof, including but not limited to roofs, heating, cooling,
electrical and plumbing systems, swimming pool, appliances, and structural
elements of the buildings. Upon the conclusion of the Inspection Period this
contract shall be deemed to-be a firm agreement of purchase and sale binding the
parties hereto, except as it may be terminated prior to the end of the
Inspection Period and subject to the other provisions and conditions contained
herein, including but not limited to the condition imposed by Paragraph 6.1(A)
above. The Inspection Period shall be extended by one (1) day for each day
beyond ten (10) days from the Effective Date delivery of the Survey and title
commitment are delayed.
6.2.3 RIGHT OF TERMINATION DURING INSPECTION PERIOD. Purchaser shall also
be permitted to review all original leases, expense records, tenant cards and
occupancy data available. if Purchaser is not satisfied, in its sole and
exclusive discretion, with the state of maintenance and repair of the Property
or the rents, occupancy or expenses of the Property, then notwithstanding
anything contained herein to the contrary, Purchaser shall have the right to
terminate this Agreement by giving written notice to Seller before the end of
the Inspection Period, and no party hereto shall have any further liability to
any other party hereto, and all deposits shall be returned to Purchaser.
6.2.4 "RENT READY". During the Inspection Period, both Seller and Purchaser
will inspect an apartment unit at the Property and mutually agree that said
apartment shall be representative of a "rent ready" unit by which all other
units shall be judged for "rent ready" condition at closing. All vacant
apartment units which have been vacant for a period of more than seven (7) days,
are to be in a "rent ready" condition (as defined
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above), at the time of closing, containing, but not limited to the following
amenities., i.e., carpet, refrigerator, range, garbage disposal, heating,
plumbing and electrical systems.
6.2.5 CONDITION OF PERSONAL PROPERTY AT CLOSING. All personal property
included in the sale and all mechanical, electrical, heating, air conditioning,
sewer, water and plumbing systems will be in the same working order at the time
of closing and in the same condition as at the time of the initial inspection by
Purchaser, If Seller fails to make reasonable efforts to conserve the property,
Purchaser shall have the option of waiving such requirement, in writing, and
proceeding to closing, or Purchaser may void this Agreement and obtain a prompt
return of its deposit.
ARTICLE VII
CLOSING
7.1 CLOSING. Closing will be held on or about (7) days after the completion
of the Inspection Period, at such place and at such time as the parties may
agree.
7.2 SELLER'S DELIVERIES. At closing, Seller shall execute and deliver to
Purchaser the Special Warranty Deed referred to in Paragraph 3 hereof and shall
also execute, where necessary, and deliver to Purchaser, the following in a form
reasonably acceptable to Purchaser:
(A) A Xxxx of Sale, with special warranty of title transferring the
personal property (as shown in Schedule B) to Purchaser free of all liens,
charges and encumbrances.
(B) The Title Policy issued by the underwriter for the Title Company
pursuant to the Title Commitment, subject only to the Permitted Exceptions, in
the full amount of the Purchase Price, dated as of the date of Closing.
(C) Originals or copies of all signed leases and rental agreements in
effect with tenants of the Property not for more than one (1) year.
(D) All security and cleaning deposits made by such tenants. Seller
shall give Purchaser a notice as required of such transfer in compliance with
the laws of Texas and Purchaser, pursuant thereto, shall notify each tenant.
(E) An affidavit of Seller in such form as will cause the Title Company
to omit from the title insurance policy the exclusion relating to unrecorded
mechanic's and materialmen's liens.
(F) A rent roll certified by Seller to be true and
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correct as of the date of closing showing the name of, and the amount of monthly
rental payable, by each tenant of the Property, the apartment occupied by the
tenant, the date to which rent has been, paid, any advance payment of rent, and
the amount of any escrow, or security deposit of tenant.
(G) An affidavit of Seller that to the best of its information and
belief there are, on the date of closing, no unsatisfied judgments, creditor's
claims other than in the course of business, tax liens, or pending bankruptcies
involving Seller.
(H) Seller shall provide, a certificate from a licensed extermination
contractor, who is regularly engaged in the business of pest control, that all
buildings are free from any termite or other wood-boring insect infestation.
Said certificate shall be dated within 90 days of closing, bearing the
Contractor's name,, contractors license number, the signature of the party
authorized to sign for the Contractor and the date of the inspection. Should
damage exist, Seller may, but shall not be obligated to proceed to have any
corrective work completed prior to closing. If Seller does not make the repairs
prior to closing, Purchaser, shall have the option of closing or at its sole
discretion cancel this Agreement. Seller shall promptly return Purchaser's
deposit upon such termination.
(I) Assignments of all Seller's interest in the following in the form
attached hereto as EXHIBIT D: (1) all assignable licenses, and permits relating
to the operation of the Property, (2) the leases and rental agreements with
tenants of the Property, (3) the existing Property telephone number and (4) the
business and trade name as set forth in Par. 1.1.
(J) Assignments without recourse of all warranties and guarantees (see
Exhibit D) to the extent such are still in effect and provide Purchaser with
copies of all such warranties and guarantees without limitation for all
appliances, dishwashers, disposals refrigerators, heating and air conditioning
units, washers and dryers.
(K) Consent of the Seller's authorized officer to the sale of the
Property and any other approvals required under Seller's articles, by-laws or
other organizational documents, which may affect Seller's ability to convey
marketable title.
(L) Provide documents for the transfer of the telephone, electric,
water and sewers and gas utilities, as may be required by the utility, for
execution at closing.
(M) Evidence satisfactory to the title company of the power and
authority of Seller to enter into and consummate this Agreement.
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(N) Affidavit that Seller has received no notice of the presence of
asbestos and/or any other hazardous material at the Property.
(O) Seller shall provide a satisfactory and valid written termination
of the management agreement executed by the existing management and rental agent
for the Property, without cost to the Purchaser.
(P) A notice letter to all the residents of the apartment complex as to
change of ownership in the form prepared by the Purchaser.
(Q) All such other documents as are normally transferred at settlement
in the jurisdiction in which the property is located or are reasonably requested
by Purchaser or its counsel.
(R) A representation letter as normally required by auditors for a
public company in the form attached hereto as EXHIBIT E. This clause shall
survive closing for one year.
(S) Closing Memorandum and Indemnification Agreement in the form
attached hereto as EXHIBIT F.
7.3 PURCHASER'S DELIVERIES. At closing and contemporaneously with the
Seller's compliance with the provisions of Section 7.2, Purchaser shall:
(A) Pay to Seller the cash portion of the purchase price, adjusted for
the prorations herein provided for in Article IV.
(B) Execute and deliver an assumption of obligations under leases,
securities, any contracts which may be accepted by the Purchaser and any other
obligations specifically set forth herein.
(C) Deliver to the Seller a resolution of the Purchaser that:
(i) This Agreement has been duly authorized, executed and
delivered by the Purchaser and is a valid and binding agreement of Purchaser,
and
(ii) Purchaser has complete unrestricted power to buy the Property
from the Seller and to execute any documents required to effectuate the
transfer.
(D) Execute all such other documents as are normally transferred at
settlement in the jurisdiction in which the property is located or are
reasonably requested by Seller or its counsel.
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ARTICLE VIII
SELLER'S REPRESENTATIONS, WARRANTIES AND COVENANTS
8.1 REPRESENTATIONS OF THE PARTIES. seller warrants (which warranties shall
not survive settlement unless designated to the contrary) that as of the date
hereof and as of closing hereof:
(A) That Seller, is the owner in fee simple of the Property and has the
power to convey same.
(B) That Seller is not subject to any other agreements or arrangements,
with the exception of those contained in any existing mortgage documents which
would prevent Seller from selling the Property to Purchaser. This warranty shall
survive for one year following closing.
(C) All necessary action has been taken by Seller to authorize the
execution of this Agreement and the performance of the obligations contemplated
hereunder, which are not excluded elsewhere in existing mortgage documents. This
warranty shall survive for one year following closing.
(D) Seller has no actual knowledge and has not been advised in writing
that it is in default under any lease, rental agreement service or equipment
contract, or mortgage or other encumbrances relating to the Property. This
warranty shall survive for one year following closing.
(E) Seller has no actual knowledge of any patent or latent defect in
the Property or any part thereof. This warranty shall survive for one year
following closing.
(F) Seller has no actual knowledge of any existing or threatened
litigation which relates to or which would affect the Property. This warranty
shall survive for one year following closing.
(G) The Property abuts on and has direct vehicular access to a public
road.
(H) Seller has no actual knowledge that any part of the Property or the
operation of the Property, is in violation or may violate any governmental
statute, regulation, ordinance or building code or of any private restriction,
that any governmental authority requires any work to be done on or affecting the
Property, or that any governmental authority has expressed an intent to condemn
or to make special improvements for the benefit of the Property or any part
thereof. This warranty shall survive for one year following closing.
(I) That to the best knowledge of the Seller, the drainage within the
project is satisfactory and complies in all
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respects with all government regulation. This warranty shall survive for one
year following closing.
(J) That Seller is not a "foreign person" within the meaning of the
Internal Revenue Code of 1954, as amended (the "Code") , and that Seller will
furnish to Purchaser prior to closing an affidavit in form satisfactory to
Purchaser confirming the same.
(K) That to the best of Seller's knowledge, the Property was never
utilized as a disposal site for hazardous waste products and will furnish to
Purchaser an affidavit confirming same.
(L) Seller covenants and agrees that, between this date and the date of
closing, Seller shall continue to maintain, operate and manage the Property in a
manner consistent with its prior practices, making every reasonable effort to do
nothing which might damage the reputation-of the Property or the relationships
with the tenants. Seller shall not permit the modification, extension or
cancellation of any tenant lease (except in accordance with the terms of such
lease) or any dealing with any tenant other than the ordinary course of managing
the Property, without the prior written consent of Purchaser. If the leases of
any tenants expire before thirty (30) days after the date of closing, Seller
shall, up to the date of closing and without cost to the Purchaser, continue its
normal course of operation with respect to causing tenants to be obtained for
apartments which are unrented.
(M) Seller warrants that it has complied with the keyless, dead-bolt
lock requirement.
8.2 CONTINUATION OF REPRESENTATIONS, WARRANTIES AND COVENANTS TO THE DATE
OF CLOSING. If each of the warranties set forth in this section does not remain
true up to and including the time of closing as to any material matters, this
Agreement, at Purchaser's election, shall be terminated, Seller shall return all
payments made by Purchaser, or Purchaser may elect to close the sale and waive
failure of the warranties.
8.3 BREACH OF REPRESENTATIONS, WARRANTIES AND COVENANTS. Notwithstanding
the provisions of 8.2 above, Seller shall indemnify Purchaser for all reasonable
costs incurred as a result of the failure of any of Seller's representations,
warranties or covenants contained herein to remain true as of the date of
closing.
ARTICLE IX
CONDEMNATION; RISK OF LOSS
9.1 (A) PROPERTY DAMAGE. If, prior to closing, any part of the Property is
damaged by fire or other casualty, Seller shall repair such damage before the
date provided herein for closing. IF such damage cannot be repaired by such
time, this Agreement may be canceled at the option of the Purchaser. In the
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event of cancellation as aforesaid, this Agreement shall become null and void
and the parties shall be released and all payments made shall be returned.
Should Purchaser elect to carry out this Agrdemefit despite such damage Seller
shall assign to Purchaser all insurance proceeds and any deductible arising from
such damage and wil'l compensate Purchaser for lost rent collections to the
extent of insurance proceeds received. Seller shall promptly notify Purchaser in
writing upon the occurrence of any such damage.
(B) CURRENT DAMAGE. The parties agree that nothing herein to the
contrary, that there are ten (10) units in the premises that have been fire
damaged and the Purchaser agrees to close under one of the following conditions:
(i) That all repairs have been made.
(ii) Repairs have not been completed, however, the Seller, with the
concurrence of the Purchaser, has settled its claim against the insurance
company and agrees to assign all insurance proceeds as well as paying an amount
equal to the deductible and assign any loss of rent for the post closing period.
(iii) Assign the claim to Purchaser as well as payment for the
deductible and an assignment of the loss of rent insurance.
9.2 CONDEMNATION. In the event of any actual or threatened taking, pursuant
to the power of eminent domain, all or any part thereof, or any actual or
proposed sale in lieu thereof, the Seller shall give written notice thereof to
the Purchaser promptly after Seller learns or receives notice thereof. Upon a
taking of a material part of the Property (any part of the building or more than
5% of the parking area) , Purchaser may elect to either (a) terminate this
Agreement, in which event the Deposit shall be immediately returned to Purchaser
and all other rights and obligations of the parties hereunder shall terminate
immediately, or (b) to waive its right to terminate this Agreement and proceed
to closing, in which event all proceeds, awards and other payments arising out
of such condemnation or sale (actual or threatened) shall be paid to the
Purchaser at closing, if such payment has been received or Seller shall assign
to Purchaser the rights to such payments.
9.3 RISK OF LOSS. Prior to closing, all risks of loss or damage by every
casualty shall be borne by the Seller.
ARTICLE X
BROKER'S COMMISSION
10.1 COMMISSION. Seller agrees to pay a brokerage fee to NATIONAL INCOME
PROPERTIES, pursuant to a separate agreement. Said brokerage fee shall be deemed
earned if, and only
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if, settlement occurs hereunder, and shall not be deemed earned even if
Purchaser and/or Seller wrongfully fail(s) to consummate the purchase and sale
herein contemplated. Seller and Purchaser represent and warrant to each other
that no other brokerage fees are or shall be owing in connection with this
transaction or in any way with the Apartments and Seller and Purchaser hereby
indemnify and hold the other harmless from any and all claims of any other
person so claiming.
ARTICLE XI
DEFAULT
11.1 DEFAULT DEFINED. Default for the purpose of this Agreement shall mean
any failure by Seller or Purchaser to fulfill all the terms, conditions and
covenants contained herein, however, it shall not be an event of default for
either party to exercise its rights to terminate this contract as contained in
other provisions herein.
11.2 SELLER'S DEFAULT. Upon Seller's default, the Purchaser, as its
exclusive remedy, may either (1) require specific performance of Seller and
commence any legal proceedings to enforce said right within ninety (90) days
after the scheduled closing date or any adjournment thereafter, (2) cancel this
Agreement and obtain a prompt return of the deposit, in which case this
Agreement shall be terminated and the parties released from all obligations
hereunder, or (3) the Purchaser may waive such defaults and proceed to
settlement. Seller shall indemnify Purchaser for any reasonable costs incurred
by Purchaser if Purchaser elects to pursue its option (1) noted above, to
include reasonable attorney fees.
11.3 PURCHASER'S DEFAULT. Upon Purchaser's default, this Agreement shall be
terminated and both parties released from all obligations hereunder, and the
deposit shall be retained by the Seller as liquidated damages. Seller shall have
no other remedy against Purchaser in the event of Purchaser's default.
ARTICLE XII
MISCELLANEOUS PROVISIONS
12.1 ENTIRE AGREEMENT. This Agreement sets forth the entire understanding
between the parties; it supersedes all previous agreements and representations
which are deemed merged herein and may not be modified except in writing.
12.2 ASSIGNMENT. Purchaser may assign this Agreement without the consent of
Seller to APPLE RESIDENTIAL INCOME TRUST, INC.
12.3 SEVERABILITY. If any provision, sentence, phrase or word Of this
Agreement or the application thereof to any person
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or circumstance shall be held invalid, the remainder of this Agreement or the
application of such provision, sentence, phrasei or word to persons or
circumstances, other than those as to which it is held invalid, shall remain in
full force and effect.
12.4 BINDING EFFECT. The parties to the Agreement mutually agree that it
shall be binding upon and inure to the benefit of their respective heirs,
representatives, successors in interest and assigns.
12.5 CONTROLLING LAW. It is the intent of the parties hereto that all
questions with respect to the construction of this Agreement and the rights and
liabilities of the parties shall be determined in accordance with the provisions
of the laws of the State of Texas.
12.6 COUNTERPARTS. To facilitate execution, this Agreement may be executed
in as many counterparts as may be required. It shall not be necessary that the
signature on behalf of both parties hereto appear in each counterpart hereof,
and it shall be sufficient that the signature on behalf of both parties hereto
appear on one or more such counterparts. All counterparts shall collectively
constitute a single contract. Counterparts may be faxed with an additional hard
copy by mail.
12.7 INCORPORATION BY REFERENCE. All of the Exhibits referred to herein
and/or attached hereto shall be deemed to constitute a part of the Agreement.
12.8 HEADINGS. The headings of the Articles and sections hereof are
inserted for convenience only and shall not be deemed to constitute a part of
the Agreement.
12.9 CONSTRUCTION OF CONTRACT. Each party hereto have reviewed and revised
(or requested revisions of) this Agreement, and therefore the normal rule of
construction that any ambiguities are to be resolved against a particular party
shall not be applicable in the construction and interpretation of this Contract
or any amendments or exhibits hereto.
12.10 CONFIDENTIALITY. The parties shall keep conf idential the existence
of this Agreement, the transactions described herein, and all information
obtained from the other party both during and subsequent to the transaction.
However, the covenants contained in this paragraph shall not apply in respect to
any information which (a) was already known to either party when such
information was received from the other, (b) was readily available to the
general public at the time of such receipt, (c) subsequently becomes known to
the general public through no fault or omission by the other party, (d) is
subsequently disclosed by a third party which has the bona fide right to make
such disclosure, or (e) is required to be disclosed by law or a governmental
agency.
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This clause shall survive closing.
12.11 HOLIDAYS. If any of the deadlines in this Contract ends on,, or it
any event is to occur on, a Saturday, Sunday, or, legal holiday, the deadline or
the date for performance shall automatically be extended to the next day which
is not a Saturday, Sunday, or legal holiday.
12.12 LEAD WARNING STATEMENT. Every purchaser of any interest in
residential real property on which a residential dwelling was built prior to
1978 is notified that such property may present exposure to lead from lead-based
paint that may place young children at risk of developing lead poisoning. Lead
poisoning in young children may produce permanent neurological damage, including
learning disabilities, reduced intelligence quotient, behavioral problems, and
impaired memory. Lead poisoning also poses a particular risk to pregnant women.
The seller of any interest in residential real property is required to provide
the buyer with any information on lead-based paint hazards from risk assessments
or inspections in the seller's possession and notify the buyer of any known
lead-based paint hazards. A risk assessment or inspection for possible
lead-based paint hazards is recommended prior to purchase.
12.12.1. Seller has no knowledge of lead-based paint and/or lead-based
paint hazard in the housing.
12.12.2. Seller has no reports or records pertaining to lead-based paint
and/or lead-based paint hazards in the housing.
12.12.3. Purchaser is hereby granted a lo-day opportunity (or the length of
the Inspection Period, whichever is longer) to conduct a risk assessment or
inspection for the presence of lead-based paint and/or lead-based paint hazards.
12.13 EXHIBITS. The following exhibits are attached to this Agreement and
are incorporated into this Agreement by this reference and made a part hereof
for all purposes:
(a) EXHIBIT A, the legal description of the Land.
(b) EXHIBIT B, list of personal property
(c) EXHIBIT C, the form of Deed.
(d) EXHIBIT D, the form of the Assignment and Assumption of Personal
Property, Service Contracts, Warranties and Leases.
(e) EXHIBIT E, the form of the Representation Letter.
(f) EXHIBIT F, Closing Memorandum and Indemnification Agreement
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ARTICLE XIII
NOTICE
13.1 NOTICE. All notices required or permitted to be given under this
Agreement shall be in writing and shall be sent or delivered to the address set
forth below (or such other address as may be hereafter specified in writing):
To Seller: Xx. Xxxx Xxxxxx
0000 Xxxxxxxxx Xxxxx
Xxxxxxxxxxxx, XX 00000
Fax: (000) 000-0000
With a copy to
Seller's Attorneys: Xxxx X. Xxxxxx, Esq.
Broude, Xxxxx & Xxxxxxxx
000 X. Xxxxxxx Xxxxxx, Xxxxx 0000
Xxxx Xxxxx, XX 00000
Fax: (000) 000-0000
To Purchaser: Xx. Xxx Xxxxxxxx
Cornerstone Realty Group, Inc.
000 X. Xxxx Xxxxxx
Xxxxxxxx, XX 00000
Fax: (000) 000-0000
With a copy to
Purchaser's Attorneys: Xxxxx X. Xxxxxxxxxx, Esq.
Xxxxxxxxxx & Taubenfeld
000 Xxxxxxxx Xx., X.X. Xxx 000
Xxxxxxxxxx, XX 00000
Fax: (000) 000-0000
-and
Xxxxxx X. Xxxxxxxx, Esq.
Xxxxx XxXxxxxxx & Oaks Xxxxxxxx
000 Xxxxxxxx Xxxxx, Xxxxx 0000
Xxxxxx, XX 00000
Fax: (000) 000-0000
13.2 DELIVERY OF NOTICE. Notices sent either by Registered or Certified
Mail, Return Receipt Requested, or by overnight express mail shall be deemed
given when deposited in the United States Mail, postage prepaid, or delivered to
a reliable overnight courier or by fax. Notices sent in any other manner shall
be deemed given only when actually delivered, at the specified address.
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13.3 TAX-DEFERRED EXCHANGE. The Seller desires to complete an exchange of
the Property in conjunction with the transfer and exchange of another tract of
property (the "Exchange Property") which exchange will qualify for
nonrecognition of gain pursuant to ss.1031, Internal Revenue Code of 1986, as
amended (the "Code"). In order to effect such exchange, Purchaser agrees to
cooperate with Seller and to execute any and all documents required in order to
consummate the transaction involving the Exchange Property. It is expressly
agreed that the Purchaser shall incur no liability or additional expenses
connected with such proposed property exchange, it being understood that the
Purchaser is agreeing merely to cooperate with Seller as an accommodation party.
If the exchange transaction does not occur as contemplated, then Purchaser and
Seller shall be obligated to perform and close this transaction in accordance
with and pursuant to the rest of the terms and provisions of this Agreement. If
the Exchange Property has not been identified or is not being acquired
contemporaneously with the conveyance of the Property to Purchaser, Purchaser
agrees to deposit the funds into an escrow account as requested by Seller in
order to afford Seller the opportunity to consummate a deferred exchange which
satisfies the requirements of the code and Regulations promulgated pursuant to
the Code. Notwithstanding the foregoing, Seller agrees that any such tax
deferred exchange will not adversely impact the Closing or postpone the Closing
Date. Seller will execute a hold harmless to Purchaser as to the content of this
paragraph
IN WITNESS WHEREOF, the Seller and the Purchaser have caused this Agreement
to be executed this day and date first written above.
SELLER:
COPPER CROSSING INVESTORS, LTD.
By: REBEL INC., a Kentucky Corporation
BY: /s/ Xxxx Xxxxxx
--------------------
Its:
-------------------
PURCHASER:
CORNERSTONE REALTY GROUP, INC.
BY: /s/ X X Xxxxxxx
--------------------
Its: S.V.P
-------------------
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