(Community Acquisition and Development Corporation
National Agreement of Sale)
AGREEMENT OF SALE
THIS AGREEMENT OF SALE made as of this 1st day of March, 1999, by and
between COMMUNITY ACQUISITION AND DEVELOPMENT CORPORATION, a Delaware
corporation ("BUYER") and RANCHO MIRAGE MOBILE HOME PARK, an Arizona partnership
("SELLER").
WHEREAS, SELLER is the fee simple owner of certain premises commonly
known as RANCHO MIRAGE MOBILE HOME PARK located in the City of Apache Junction,
Pinal County, Arizona, more particularly described in Exhibit "A" attached
hereto and made a part hereof (together with all rights and easements
appurtenant thereto and all permanent improvements, fixtures and utility systems
thereon, being hereinafter collectively referred to as the "Real Property"); and
WHEREAS, SELLER desires to sell and BUYER desires to purchase the Real
Property and all personal property and equipment described in the Schedule of
Personal Property attached hereto as Exhibit "B" and made a part hereof (the
"Personal Property"), under the terms and conditions set forth herein (the
aforesaid Real Property and Personal Property being hereinafter collectively
referred to as the "Property").
NOW, THEREFORE, in consideration of the mutual covenants contained
herein, together with other valuable considerations, the receipt and sufficiency
of which is hereby acknowledged, SELLER agrees to sell and BUYER agrees to buy
the Property on and under the terms and conditions herein set forth.
1. SALE AND PURCHASE OF PROPERTY. SELLER agrees to sell and
convey to BUYER and BUYER agrees to purchase:
(a) All of SELLER's right, title and interest in and to the
Real Property, together with all right, title and interest of SELLER in and to
any land lying in the beds of any streets, avenues, alleys or passages, open or
proposed, bounding or abutting the Real Property, and drainage rights
appurtenant to the Real Property, together with all right, title and interest,
if any, of SELLER, in and to any easements, rights of way or passageways
appurtenant to or benefiting the Real Property and free of all liens and
encumbrances except the Permitted Exceptions, as that term is defined in
Paragraph 4 hereof;
(b) All articles of personal property of whatsoever nature or
sort, if any, which are owned by SELLER and which, as of the date of this
Agreement of Sale, are attached or appurtenant to or used in connection with or
located in or upon the Real Property, and any additions thereto or replacements
thereof which may be made between the date of this Agreement of Sale and the
date of Closing hereunder (all of the foregoing being hereinafter collectively
referred to as the "Personal Property"), which Personal Property shall be
conveyed by SELLER to BUYER at Closing by a quitclaim xxxx of sale. Personal
Property shall exclude (i) any items of property owned by the Seller which is
unrelated to the operation of the Real Property, but may be stored at the Real
Page 1
Property, and (ii) any records, correspondence and other documents that are in
the possession of the accountants and attorneys of SELLER, which are either
privileged information or which are duplicates of records maintained by SELLER
on site. In addition, while all of the operating records relating to the Real
Property shall be included in the Personal Property, the SELLER shall have
reasonable access to such records for any purpose, including, but not limited to
income taxes, claims by suppliers or others, provided however, BUYER shall not
be required to maintain copies of any such records; and
SELLER's interest in the Real Property and the Personal Property are
hereinafter sometimes referred to collectively as the "Property".
2. CONSIDERATION. The total consideration to be paid by BUYER for
the Property shall be in the sum of ELEVEN MILLION FIVE HUNDRED FIFTY THOUSAND
DOLLARS ($11,550,000.00) (the "Purchase Price").
3. PAYMENT OF CONSIDERATION. The Purchase Price shall be paid as
follows:
(a) BUYER and SELLER acknowledge that BUYER has delivered to
Lawyers Title Insurance Company (the "Escrow Agent"), at the following address:
0000 X. Xxxxxxxxx Xxxx, Xxxxx 000, Xxxxxxx, XX 00000 Attn: Xxxx Xxxxxxxx, the
sum of TEN THOUSAND DOLLARS ($10,000.00) which shall represent the initial
xxxxxxx money deposit for the Property (the "Initial Deposit"). The Initial
Deposit has been or shall be deposited by Escrow Agent in its Trust Account
until the expiration of the BUYER's Inspection Period (as hereinafter defined).
(b) Within five (5) business days of the Effective Date of
this Agreement of Sale, as that term is defined in paragraph 34 below, BUYER
shall deliver to the Escrow Agent, the sum of ONE HUNDRED NINETY THOUSAND
DOLLARS ($190,000.00) which shall represent additional xxxxxxx money deposit for
the Property (the "Additional Deposit"). The Additional Deposit shall be
deposited by Escrow Agent in its Trust Account until the expiration of the
BUYER's Inspection Period (as hereinafter defined). The Initial Deposit and the
Additional Deposit are collectively referred to herein as the "Deposit".
(c) The Escrow Agent shall, upon receipt from BUYER of a
complete and fully executed W-9 Reporting Form, deposit the Deposit into an
interest bearing money market account, which interest shall accrue to BUYER's
benefit unless BUYER defaults hereunder.
(d) BUYER shall pay the balance of the Purchase Price to
Escrow Agent at Closing by wire transfer of immediately available federal funds
to be disbursed together with the Deposit as provided in this Agreement.
4. TITLE INSURANCE.
Page 2
A. Within five (5) business days after SELLER delivers its
existing title insurance policy to BUYER, Escrow Agent shall, at SELLER's
expense, deliver to BUYER and BUYER's Attorney for approval, as hereinafter
provided, a preliminary owner's title binder for a title insurance policy,
together with copies of all exception documents referred to therein, to be
issued by an agent of Escrow Agent licensed and qualified to do business in the
state in which the Real Property is located (the "State"). The binder and
standard owner's policy to be issued pursuant thereto shall be paid for by
SELLER, shall be issued at the minimum promulgated rate, and shall be in an
amount equal to the amount of the purchase price. The policy and binder shall be
in a current ALTA standard form "B", except that there shall be no exceptions
unless agreed to by BUYER. The exceptions which are allowed or approved under
the terms of the Agreement shall be referred to as "Permitted Exceptions".
Additional endorsements or coverages above the standard policy required by BUYER
shall Buyer shall be provided to the extent available at BUYER'S expense.
B. BUYER shall have twenty (20) business days after receipt of
the title binder, together with copies of all exception documents referred to
therein, and the survey called for in paragraph 5 hereof to give written notice
to SELLER or SELLER's attorney of any objections by BUYER to the state of title
(including any matters shown on the survey which are unacceptable to BUYER).
Failure of BUYER to deliver a written notice of objection of the state of title
to SELLER or SELLER's attorney within said twenty (20) day period shall be
conclusive evidence that BUYER has approved said preliminary title report.
C. After written notice from BUYER to SELLER identifying a
title defect, SELLER shall have a reasonable time, not to exceed thirty (30)
days, to cure the title defect identified in such notice. If SELLER fails to
cure such title defect as to which due notice is given, BUYER shall have the
option to:
(a) terminate this Agreement, in which case BUYER
shall notify SELLER that BUYER will not proceed with the purchase, whereupon
this Agreement shall terminate and all parties shall be released from any
further obligations hereunder, except that BUYER shall be entitled to an
immediate refund of all monies paid in respect of the purchase price plus
accrued interest, if any, or
(b) proceed under this Agreement and accept title
to the Real Property subject to such defects, in which case the Closing shall
take place on the later of the date set for Closing as hereinafter provided or
on a date mutually agreed upon by SELLER and BUYER which shall be within ten
(10) days from the date of such election by BUYER (the date finally set by the
parties hereto for the Closing shall be hereinafter referred to as the "Closing
Date").
D. Escrow Agent or its agent, shall be in attendance at the
Closing and be in a position to issue the title policy upon recording the
appropriate documents and insure that SELLER has complied with all requirements
set forth under the applicable state statutes to extinguish any right of
purchase or rescission in favor of any tenants or homeowners association.
Page 3
5. SURVEY. During the BUYER's Inspection Period (as
hereinafter defined), BUYER may obtain, at its expense, a current "as built"
survey of the Real Property. If the survey discloses any conditions which are
unacceptable to BUYER, this shall be deemed a defect in title and paragraph 4
above, shall apply.
6. REPRESENTATIONS AND WARRANTIES.
A. To induce BUYER to enter into this Agreement, SELLER makes
the following representations and warranties, all of which shall be true and
correct continuously throughout the term of this Agreement, and which shall
survive the closing of title for a period of six (6) months from the Closing
Date (hereinafter defined), SELLER shall notify BUYER of any changes to the
foregoing occurring during the term of this Agreement:
(a) SELLER is the owner of the Property and has the
authority to execute and deliver this Agreement.
(b) To the best of SELLER's knowledge, there are no
special or other assessments levied against or relating to the Property and
SELLER does not know of any proposed assessments.
(c) No goods or services have been contracted for by
SELLER or furnished to the Real Property on SELLER's behalf which might give
rise to any mechanic's liens upon or affecting all or any part of the Real
Property. Notwithstanding the foregoing, BUYER and SELLER acknowledge that
SELLER is installing new telephone lines and service. SELLER shall provide to
BUYER and the title company lien waivers and/or an indemnity in form acceptable
to BUYER and the title company with respect to this liability.
(d) There are no leases which affect the Real
Property except as set forth in the Rent Roll attached hereto as Exhibit "C" and
made a part hereof and the information contained on the Rent Roll is true and
correct; no rental agents, brokers or finders have any rights with regard to
such leases and there are no commissions payable in connection therewith; no
tenant has an option to purchase any part of the Property; and SELLER is the
lessor under each such lease and has the right to assign same to BUYER.
(e) SELLER has received no notice of any violations
of any law, ordinance, rule, order, regulation, code or requirement, including
any requirement contained in any hazard insurance policy covering the Property
or any part thereof or of any board of fire underwriters or other body
exercising similar functions, which are applicable to the Property or to any
part thereof or which are applicable to the use or manner of use, occupancy,
possession or operation of the Property.
(f) To the best of SELLER's knowledge, SELLER has
obtained and kept in good standing all governmental permits, licenses, and
approvals necessary for the operation of the Property as a manufactured housing
(mobile home) community, including, as applicable, all County Health Permits or
other applicable permits, State Department of Environmental Protection permits,
Page 4
and, to the best of SELLER's knowledge, there are no material violations
currently existing thereunder.
(g) SELLER has not contracted for any services or
employment and has made no commitments or obligations therefor which will bind
BUYER as a successor in interest with respect to the Property except those
contracts listed in Exhibit "D" attached hereto and made a part hereof (the
"Service Contracts"). With respect to the Service Contracts: (i) amounts paid or
payable thereunder shall be prorated between the parties at the Closing and
credits shall be given the parties as appropriate to such prorations; and (ii)
they can each be terminated upon thirty (30) days written notice or less except
as set forth on Exhibit "D".
(h) Except in the ordinary course of SELLER's
business, SELLER will not enter into any amendment to or modification of any of
the Leases prior to the Closing Date, which will reduce, forgive, or postpone
any rents or which would otherwise materially affect the value of the Property,
without BUYER's consent which shall not be unreasonably withheld or delayed; no
rents or other deposits are or will on the Closing Date be held by SELLER,
except only tenant security deposits and prepaid rents; and no commissions or
other fees payable to any person, entity or agent are due on the rentals
collected or to be collected under the Leases.
(i) Pending Closing hereunder, SELLER shall conduct
its business involving the Property in the ordinary course, and during said
period will:
(1) Refrain from entering into any contracts
or other commitments regarding the Property, other than in the ordinary and
usual course of business, without the prior written consent of BUYER which shall
not be unreasonably withheld or delayed;
(2) Continue to maintain and repair the
Property in at least the manner which SELLER has previously maintained and
repaired the Property, and SELLER will permit or commit no waste of the
Property; and
(3) Keep in effect SELLER's existing
policies of public liability and hazard and extended coverage insurance insuring
the Property.
(j) No tenant has been granted any rent concession
not reflected on the face of the copy of the lease for that tenant as provided
by SELLER to BUYER (other than as set forth on the Rent Roll).
(k) To the best of SELLER's knowledge no underground
storage tanks, hazardous substances, or contaminants subject to Federal, state
or local laws or regulation have been used, stored or located on, under or about
the Property in any manner contrary to applicable law and
the Property is free from environmental contamination by such hazardous
substances which require remediation except as set forth in any Phase I
Environmental Report attached hereto as Exhibit "E".
Page 5
B. SELLER, by executing this Agreement, agrees to indemnify,
defend and save and hold BUYER harmless from and against any and all losses,
costs, expenses, liabilities, claims, causes of action, suits or other matters
by reason of any breach of the above representations and warranties. Such
indemnification includes, but is not limited to, costs and attorneys' fees and
expenses (including attorneys' fees and expenses on appeal) reasonably incurred
in connection with the defense of any claims against BUYER by any party arising
out of the above matters. The SELLER's foregoing indemnity obligation shall
survive Closing and delivery of the Special Warranty Deed hereunder for a period
of six (6) months. In addition, should any representation or warranty made by
SELLER hereunder be determined by BUYER at or before Closing to be incorrect and
BUYER opt to terminate this Agreement as a result thereof, SELLER shall be
obligated to reimburse BUYER promptly upon written demand for the costs of
BUYER's diligence review of the Property through the date of termination up to a
maximum of $25,000.00. This indemnity obligation shall survive Closing and
delivery of the Special Warranty Deed hereunder and shall include all attorneys'
fees and costs incurred in collection of all sums due from SELLER to BUYER
pursuant to this Indemnity, together with interest on said sums at the rate of
ten (10%) percent per annum.
C. In the event that any one or more of the representations or
warranties given by SELLER to BUYER in paragraph 6A above is/are determined by
BUYER between the Closing Date and the Effective Date, to be inaccurate, BUYER
shall give written notice to SELLER and SELLER shall have the option to: use its
best efforts to promptly cure the violation(s); reimburse BUYER for the
reasonable cost of cure (including all reasonable attorneys' fees, engineering
fees, or other applicable fees, costs and charges); or to contest BUYER's
determination by written notice to BUYER, in which event BUYER shall have the
option to pursue the rights and remedies available to BUYER pursuant to
paragraph 20 of this Agreement.
7. TERMITE INSPECTION AND REPORT. Prior to the expiration of the
BUYER'S Inspection Period, and at BUYER's expense, BUYER shall obtain a termite
certificate for the Property. Any infestation or damage therefrom found to be
existing shall be repaired in a reasonable time, not to exceed two (2) months
from the Closing Date, at SELLER's expense not to exceed $5,000.00. In the event
SELLER fails to make said repairs within said time period, BUYER shall have the
right to make said repairs and to collect the cost thereof (not to exceed
$5,000.00) from SELLER in the manner provided for a reproration pursuant to
paragraph 12 below. Any sums advanced by BUYER in this connection shall bear
interest at the highest lawful rate until paid. This paragraph shall survive the
closing of this transaction and delivery of the Special Warranty Deed.
8. BUYER'S INSPECTION PERIOD. BUYER shall have until April 15, 1999
("BUYER's Inspection Period"), during which time BUYER shall have the right to
perform such due diligence evaluations as BUYER may reasonably require in
connection with its evaluation of the Property, including, but not limited to,
environmental, soils, flood plain, legal, financial and engineering studies (the
"Data"), all at BUYER's sole cost and expense. BUYER hereby indemnifies and
agrees to hold harmless and defend SELLER from and against any and all losses or
claims for property damage or personal injury or any liability under any
environmental or other law arising out of BUYER's inspections and BUYER and/or
any contractor of BUYER shall, prior to entry on the Real Property hereunder,
obtain casualty/liability insurance in an amount satisfactory to SELLER, or to
add SELLER to existing policies as a named insured, and provide SELLER with a
Page 6
certificate of insurance evidencing that SELLER is insured against any such
loss. In the event that any inspection by BUYER or any consultant engaged by
BUYER in connection with BUYER's due diligence results in any damage or
disturbance to the Property or any other damage or disturbance, BUYER shall
cause such consultant, or undertake itself, at no cost to SELLER, to repair
promptly such damage and restore such Property to the condition it was in
immediately prior to such inspection. If BUYER approves of the Data, BUYER shall
deliver written notice to SELLER indicating BUYER's approval of the Data (the
"Data Approval Notice") prior to the expiration of the Inspection Period. If
BUYER fails to deliver the Data Approval Notice as aforesaid, the Data shall be
deemed unsatisfactory to BUYER and this Agreement shall automatically terminate,
in which event, Escrow Agent shall immediately return the Deposit, plus any
accrued interest, to BUYER and the parties shall be released from any further
obligations hereunder. In connection with BUYER's due diligence evaluations of
the Property, SELLER agrees to furnish the following information to BUYER within
five (5) days of the Effective Date (unless otherwise provided herein):
1. Current Rent Roll;
2. Monthly Financial Statements for the previous thirty-
six (36) months;
3. Statement of Policy, Rules and Regulations, form of
Rental Agreement and other State required documents;
4. Mobile Home Inventory List;
5. Previous Title Insurance Policy;
6. Prior Survey or Development Plans, if reasonably
available;
7. Liability Listing (contingent and non-contingent),
excluding accounts payable in the ordinary course of
business and the unsecured liability for the
telephone installation (at Closing, SELLER shall
represent and warrant that the Property is
unencumbered other than current real estate taxes and
the Permitted Exceptions);
8. Lists of all current and previous legal action;
9. Existing Environmental Phase I Report (if any);
10. True Copies of paid real estate and personal property
tax bills for the previous three (3) years;
11. True Copies of Rental Increase Notices for previous
three (3) years.
9. CONDITIONS PRECEDENT. The following are conditions precedent to
BUYER's obligation to close and consummate the transaction contemplated by this
Agreement. BUYER and only BUYER, may waive one or more of these conditions. In
the event that all of these conditions are not satisfied or fulfilled by the
Closing Date, BUYER may elect not to close this transaction, and in such event,
BUYER shall be entitled to the prompt return from Escrow Agent of the Deposit:
A. The representations and warranties of SELLER contained in
paragraph 6 above, and all other representations and warranties of SELLER
contained herein, shall be true and correct on the Closing Date. SELLER, by
having closed the sale of the Property, shall be deemed conclusively to have
Page 7
certified that as of the Closing Date all such representations and warranties
were true and correct on the Closing Date.
B. There shall have been no material change in the physical
condition or the net operating income of the Property.
10. CLOSING. The sale and purchase transaction contemplated by this
Agreement shall be closed and consummated on or before April 30, 1999 (the
"Closing Date"). Closing shall be at the offices of SELLER's counsel or, at
BUYER's option, may be effected through the mail as coordinated by counsel for
SELLER and BUYER. The Closing shall be at 10:00 MST, Eastern Standard Time on
the Closing Date unless otherwise agreed by the parties or their counsel. At
Closing, SELLER and, as applicable, BUYER and SELLER shall execute and deliver
the following documents in form acceptable to BUYER and SELLER and/or undertake
the following:
A. All corporate or applicable partnership certifications,
resolutions and approvals necessary to evidence both the SELLER's and BUYER's
authority to enter into and consummate the transactions contemplated by this
Agreement.
B. Special Warranty Deed from SELLER to BUYER conveying title
to the Real Property to BUYER.
C. Xxxx of Sale from SELLER to BUYER transferring the Personal
Property free and clear of all liens and encumbrances together with the original
Motor Vehicle Certificate of Title (properly endorsed and lien free) for each
mobile home unit and motor vehicle included in this purchase and sale.
D. Affidavit of No Liens by SELLER.
E. Affidavit of Non-Foreign Status by SELLER.
F. State Statutes Affidavit of Compliance by SELLER.
G. Updated certified rent roll dated and accurate as of the
Closing Date and certified by SELLER to BUYER.
H. Assignment from SELLER to BUYER assigning all of SELLER's
right, title and interest, to the extent it exists and without representation or
warranty, in and to the name by which the Property is commonly known, all
authorizations, permits and licenses relating to the operation of the Property
which are assignable by SELLER, if any, and all leases, contracts certificates
of occupancy and other items required to be assigned as set forth in this
Agreement free and clear of all liens and encumbrances except for the matters
permitted in this Agreement; all of which shall be assumed by BUYER effective
from and after the Closing Date. SELLER shall undertake all action, and execute
all forms, required by all governmental authorities and contract vendors to
effect this assignment.
Page 8
I. Assignment by SELLER, to the extent they exist and without
representation or warranty, of all currently existing and effective claims,
guaranties, warranties, indemnifications and all other rights, if any, which
SELLER may have against suppliers, laborers, materialmen, contractors, or
sub-contractors arising out of or in connection with the installation,
construction and maintenance of the Property; all of which shall be assumed by
BUYER effective from and after the Closing Date.
J. Assignment by SELLER, to the extent they exist and without
representation or warranty, to BUYER of all agreements, if any, which SELLER has
for access and utilities to service the Property; all of which shall be assumed
by BUYER effective from and after the Closing Date.
K. Closing Statement by SELLER and BUYER.
L. Such other documents as are reasonably necessary to close
and consummate the purchase and sale transaction contemplated by this Agreement.
M. SELLER shall deliver to BUYER all existing plans and
specifications relating to the improvements located upon the Property which are
in SELLER's possession or reasonably accessible to SELLER.
N. Once the requirements for closing have been satisfied,
BUYER shall deliver to Escrow Agent the adjusted cash portion of the Purchase
Price and authorize Escrow Agent's delivery of the adjusted purchase amount to
SELLER. Said sum shall be paid, at SELLER's election, by locally drawn cashier's
check or Federal Reserve Bank wire transfer.
11. CLOSING COSTS. SELLER shall pay for the cost of any corrective
documents required for marketable and insurable title, transfer stamps on the
Special Warranty Deed and all costs associated with the issuance of the title
binder and standard title insurance policy. BUYER shall pay for any extended
title insurance coverage, the survey and the cost of recording the Special
Warranty Deed. Each party shall bear its own attorneys' fees and other
professional costs, except as otherwise provided for herein.
12. PRORATIONS. Except as otherwise set forth in this Agreement, all
taxes and other operating expenses and revenue of the Property shall be prorated
as of the Closing Date. Taxes shall be prorated based upon the current year's
tax. If the Closing takes place and the current year's taxes are not fixed and
the current year's assessment is available, taxes shall be prorated based upon
such assessment and the prior year's millage. If the current year's assessment
is not available, then taxes shall be prorated on the prior year's tax. In the
event the tax proration is incorrect on the Closing Date because the property is
reassessed for the tax year of the Closing by the governmental agency having
jurisdiction over the Property, subsequent to the Closing Date, BUYER or SELLER
shall be entitled, as the case may be, to a reproration of such taxes upon
written request made to the other party. SELLER or BUYER shall remit the
reproration adjustment amount requested within ten (10) days of request
therefor. In the event SELLER or BUYER fails to remit the reproration amount
Page 9
requested within said ten (10) day period, the party seeking reimbursement shall
be entitled to all costs of collection, including all attorneys' fees and costs
incurred in collection thereof and the amount owing shall bear interest at the
highest lawful rate until paid, it being acknowledged that this right shall
survive Closing and delivery of the Special Warranty Deed. Any rents received by
SELLER in respect of the period after the Closing Date shall be promptly
remitted to BUYER. With regard to delinquent rents, if any, BUYER shall not be
held responsible for and BUYER shall not be required to institute any
proceedings whatsoever to collect such delinquent rents. However, all rents
received by BUYER attributable to periods prior to the Closing Date shall be
promptly remitted by BUYER to SELLER. All rents collected after the Closing
shall be first applied to current rents due, then to rents for periods prior to
the Closing Date unless they are clearly intended by the tenant to apply for the
period prior to Closing in which event they shall be promptly remitted to
SELLER. This obligation to remit shall survive the Closing and delivery of the
Special Warranty Deed. SELLER shall deliver to BUYER at the Closing, copies of
such statements, invoices bills and receipts as shall be requested by BUYER to
enable BUYER to verify the accuracy of the amounts of any prorations made
pursuant to this paragraph. BUYER shall be credited at Closing with all advance
rentals and tenant security deposits previously paid to SELLER. All prorations
shall be made so that SELLER has the benefit of all income and the burden of all
expenses up to and including the Closing Date and BUYER has the benefit of all
income and the burden of all expenses after the Closing Date. SELLER and BUYER
shall indemnify and hold harmless the other party harmless from all claims or
damages, expenses or obligations, including applicable attorney's fees, incurred
in connection with the prorated items due to their respective periods of
ownership or the Real Property or the Personal Property, and for the benefit and
charges relating therto.
13. DELIVERY OF POSSESSION. At Closing, SELLER shall deliver possession
of the Real Property to BUYER.
14. FIRE OR OTHER CASUALTY. For purposes of this Agreement of Sale, a
"minor casualty" shall be any casualty occurring to the Real Property which
causes damages of less than One Hundred Fifty Thousand Dollars ($150,000.00) to
the Real Property. Any other casualty shall be a "major casualty". If, prior to
Closing hereunder, the Real Property is subjected to a major or minor casualty
of which SELLER becomes aware, SELLER shall give BUYER prompt written notice
thereof. If such casualty is a minor casualty, this Agreement of Sale shall
remain in full force and effect and the purchase contemplated herein shall be
concluded with no further adjustment, and at Closing SELLER shall assign,
transfer and set over to BUYER all of the right, title and interest of SELLER in
and to any awards that have been or that may thereafter be made for such
casualty, subject only to any rights of Tenant under each Lease. If such
casualty is a major casualty, the Real Property shall be considered a defective
parcel and BUYER shall have the right to terminate this
Agreement whereupon the Deposit will be refunded to the BUYER and the parties
will be released from any further liability hereunder.
15. EMINENT DOMAIN. For purposes of this Agreement of Sale, a "minor
condemnation" shall be any taking or condemnation by any body having the power
of condemnation or eminent domain which causes damages of less than One Hundred
Fifty Thousand Dollars ($150,000.00) to the Real Property. Any other taking or
condemnation shall be a "major condemnation". If prior to Closing hereunder the
Page 10
Real Property is subjected to a major or minor condemnation of which SELLER
becomes aware, SELLER shall give BUYER prompt written notice thereof. If such
condemnation is a minor condemnation, this Agreement of Sale shall remain in
full force and effect and the purchase contemplated herein, less any interest
taken by eminent domain or condemnation, shall be effected with no further
adjustment, and at Closing, SELLER shall assign, transfer and set over to BUYER
all of the right, title and interest of SELLER in and to any awards that have
been or that may thereafter be made for such taking, subject only to rights of
Tenant under any Lease. If such condemnation is a major condemnation, the Real
Property subject to the major condemnation shall be considered a defective
parcel and BUYER shall have the right to terminate this Agreement whereupon the
Deposit will be refunded to the BUYER and the parties will be released from any
further liability hereunder
16. NOTICES. All notices and other communications under this Agreement
of Sale shall be in writing and shall be effectively given only if sent by
nationally recognized overnight courier service, postage prepaid, return receipt
requested, addressed as follows:
To SELLER: Rancho Mirage Mobile Home Park
c/o Xxxxx XxXxxxxx
000 Xxxx Xxxxxxx Xxxxxx #000
Xxxxxxx, XX 00000
FAX No. (___) ______________
With a copy to: Xxxxx Xxxxxxxx, Esquire
0000 X. Xxxxxxx Xxxxxx, #0000
Xxxxxxx, XX 00000
FAX No. (000) 000-0000
To BUYER: Community Acquisition and Development
Corporation
Attn: Xxxxxx X. Xxxxxx
0000 XxXxxxxxx Xxxxx, Xxxxx X
Xxxxxxxxxx, Xxxxxxx 00000-0000
FAX No. (000) 000-0000
With a copy to: Community Acquisition and
Development Corporation
Attn: Xxxxx X. Xxxxx
0 Xxxxx Xxxx Xxxxx
Xxxxxx Xxxx, XX 00000
FAX No. (000) 000-0000
or such other address as the party to be notified shall have designated to the
other party hereby by notice delivered in . accordance herewith. All such
notices shall be deemed given on the business day next following the day such
notice is accepted for delivery by the overnight courier service.
Page 11
17. ASSIGNMENT. BUYER may assign its rights and interests under this
Agreement of Sale to any party without first obtaining the prior written consent
of SELLER, provided, however, any such assignee shall assume in writing and
comply with all of the obligations of BUYER hereunder. Notwithstanding any such
assignment, BUYER shall not be relieved of its obligations hereunder without
SELLER'S written consent. Any adjustments, allocations or other items of concern
between BUYER and any such assignee made in connection with any such assignment
shall be between BUYER and such assignee and shall not be binding upon nor
change the rights or claims of SELLER herein except with the written consent of
SELLER. BUYER will notify SELLER of the identity of any proposed assignee of
this Agreement of Sale prior to Closing.
18. SUPPLIES. Inventories of supplies, including but not limited to
paint, toilet tissue, soap, paper towels and all cleaning materials, if any
located on the Real Property on the Closing Date shall be transferred to BUYER
at no additional cost at the time of Closing and shall be covered by the Xxxx of
Sale.
19. DEFAULT BY SELLER. If, under the provisions of this Agreement,
SELLER shall be obligated to complete the sale of the Property but fails to do
so within the applicable period provided for closing and such default continues
for a period of fifteen (15) days after written notice thereof from BUYER to
SELLER, or shall otherwise fail to perform any of the other obligations of
SELLER hereunder within the required time period, BUYER shall have the option,
to be exercised in its sole discretion, to: (a) apply to the Circuit Court of
the County where the Real Property is located to seek to have specific
performance under this Agreement and in such action shall have the right to
recover legally cognizable damages suffered by BUYER by reason of the delay in
BUYER's acquisition of the Property; or (b) xxx SELLER for legally cognizable
damages sustained by BUYER by reason of the default of SELLER provided, however,
that in no event shall the damages recoverable exceed four percent (4%) of the
gross purchase price; or (c) obtain the prompt return from Escrow Agent of the
Deposit, with interest, together with any other amounts due and owing to BUYER
pursuant to the terms of this Agreement, and thereafter terminate this
Agreement.
20. DEFAULT BY BUYER. If, under the provisions of this Agreement, BUYER
shall be obligated to complete the purchase of the Property but fails to do so
on or before April 30, 1999 (unless caused by the default of SELLER), and such
default of BUYER continues for a period of ten (10) days after written notice
thereof from SELLER to BUYER, SELLER may terminate this Agreement by written
notice thereof to BUYER which notice of termination shall be delivered to BUYER
within five days after the aforementioned ten day cure period, and SELLER's sole
right and exclusive remedy against BUYER shall be to obtain the Deposit (a) as
consideration for the execution of this Agreement; (b) as agreed on liquidated
damages sustained by SELLER because of such default by BUYER (the parties hereto
agreeing that the retention of such funds shall not be deemed a penalty, and
recognizing the impossibility of precisely ascertaining the amount of damages to
SELLER because of such default and hereby declaring and agreeing that the sum so
retained is and represents the reasonable damages of SELLER); (c) in full
settlement of any claims of damages and in lieu of a specific performance by
SELLER against BUYER; and (d) in consideration for the full and absolute release
of BUYER by SELLER of any and all further obligations under this Agreement. In
Page 12
the event BUYER defaults hereunder, BUYER shall forthwith on demand by SELLER
return to SELLER all title papers and other documents relating to the Property,
including BUYER's copy of this Agreement.
In addition, if BUYER shall be obligated to complete the purchase of
the Property but fails to do so on or before April 30, 1999 (unless caused by
the default of SELLER), BUYER and SELLER shall notify Escrow Agent to release
the Deposit to SELLER, and if BUYER cures the default and closes the transaction
within said ten (10) day cure period, all prorations shall be made as of April
30, 1999 and BUYER shall pay to SELLER interest on the Purchase Price at the
rate of eight (8%) percent per annum on the balance of the Purchase Price until
the earlier of the Closing or the date this Agreement is terminated by SELLER or
BUYER.
If BUYER does not cure such default and close the transaction within
said ten day period, and SELLER elects not to terminate this Agreement, BUYER
may either: (i) terminate this Agreement by providing written notice thereof to
SELLER, in which case SELLER shall be entitled to retain the Deposit as set
forth in (a), (b), (c), and (d) above; or (ii) continue to cure such default and
close the transaction, in which case BUYER and SELLER shall notify Escrow Agent
to release the Deposit to SELLER and interest shall continue to accrue at eight
(8%) percent per annum until closing. If BUYER elects to continue to cure such
default, BUYER or SELLER may terminate this Agreement by providing at least ten
days prior written notice thereof to the other, which notice shall provide that
if the Closing does not occur within said ten day period the Agreement shall be
terminated and SELLER shall be entitled to retain the Deposit as set forth in
(a), (b), (c), and (d) above.
21. PROVISIONS WITH RESPECT TO ESCROW.
(a) The duties and obligations of Escrow Agent hereunder shall
be entirely administrative and ministerial and not discretionary. Escrow Agent
shall be under no responsibility in respect of the Deposit other than to
faithfully follow the instructions herein contained. Escrow Agent may
conclusively rely upon any instructions or documents delivered to it by BUYER
and SELLER and purportedly executed by a duly authorized officer or partner
thereof and shall be under-no duty of independent inquiry with respect to any
facts or circumstances recited therein. In the event that any notice or
instruction required to be delivered to Escrow Agent hereunder is not so
delivered, Escrow Agent may hold the Deposit, if any, pending delivery to Escrow
Agent of such instruction or notice and may exercise all of Escrow Agent's
rights and remedies hereunder or otherwise provided by law. The parties hereto
jointly and severally agree to reimburse and indemnify Escrow Agent for, and
hold Escrow Agent harmless against, any loss, liability or expense, including
but not limited to, reasonable attorney's fees, which may be asserted against
Escrow Agent or to which Escrow Agent may be exposed or which may be incurred by
reason of the acceptance of, or the performance of duties and obligations under
this Agreement of Sale, except arising from such Escrow Agent's gross negligence
or willful misconduct. In no event shall Escrow Agent be liable for any loss,
cost or damage arising out of the performance of its duties hereunder, except
for acts of gross negligence or willful misconduct.
Page 13
(b) In the event of any dispute or disagreement in connection
with the performance by Escrow Agent of its duties under this Agreement of Sale,
including, but not limited to, the respective rights of the parties to the
Deposit, Escrow Agent may consult with counsel selected and employed by Escrow
Agent, and Escrow Agent shall suffer no liability for any action taken or
suffered in good faith in accordance with the opinion of such counsel, if any,
provided, however, that the Deposit shall be disbursed in accordance with the
terms of this Agreement of Sale. Notwithstanding any other provision of this
Agreement of Sale, if any dispute or difference arises among the parties or if
any conflicting demand shall be made upon Escrow Agent, Escrow Agent shall not
be required to determine the same or take any action thereon. Rather, Escrow
Agent may await settlement of the controversy by appropriate legal proceedings;
or Escrow Agent may, by written notice to the parties hereto, initiate
litigation to determine to whom the Deposit held under this Agreement of Sale
shall be delivered; or Escrow Agent may file suit in interpleader with the
proper court in the United States District Court for the District in which the
Real Property is located, for the purpose of having the respective rights of the
parties adjudicated. Notwithstanding the foregoing, BUYER, SELLER or Escrow
Agent may elect to initiate action in the Maricopa County Arizona Superior
Court. Escrow Agent, upon initiation of such suit, may deposit with the court
the Deposit and, upon giving notice thereof to the parties hereto, Escrow Agent
shall be fully released and discharged from all further obligations hereunder
with respect to the Deposit except arising from gross negligence or willful
misconduct of Escrow Agent.
22. ACCEPTANCE DATE. SELLER shall have until 5:00 P.M. (EST) on the
fifth (5th) business day following Buyer's Execution Date, within which to
accept this Agreement. In the event SELLER fails to accept this Agreement as of
that time and date, this Agreement shall be null and void and of no further
effect and BUYER shall be entitled to the prompt return from Escrow Agent of the
Deposit.
23. BROKER'S COMMISSION. SELLER and BUYER each warrant that there are
no real estate or other brokers or finders of any type involved in this
transaction other than Xxxx Xxxxxxxx. BUYER shall be responsible to pay any
commission due to Xxxx Xxxxxxxx pursuant to a separate agreement. Each party
shall indemnify and hold harmless the other party from all claims or damages for
any brokerage commissions and/or fees being claimed arising out of this
transaction resulting from the actions of the defaulting party.
24. SURVIVAL OF AGREEMENT. The terms and conditions of this Agreement
which expressly so state shall survive the Closing hereof.
25. CONFIDENTIALITY. SELLER and BUYER agree not to disclose any of the
terms and conditions of this Agreement except to the officers, directors,
employees and third party professionals assisting each party with due diligence,
preparation of the Agreement and closing of this transaction. BUYER shall
coordinate its due diligence efforts with SELLER. SELLER shall neither solicit
nor accept any other offers so long as this Agreement is in effect.
26. TIME IS OF THE ESSENCE. SELLER and BUYER acknowledge that time is
of the essence of this Agreement.
Page 14
27. MODIFICATIONS. The parties acknowledge that this Agreement is the
entire agreement between the parties with respect to the subject matter hereof
and that this Agreement cannot be modified without a written agreement executed
by both parties.
28. ATTORNEYS' FEES. In the event of any litigation between the parties
arising out of this Agreement, or the collection of any funds due BUYER or
SELLER pursuant to this Agreement, the prevailing party shall be entitled to
recover all costs incurred and reasonable attorneys' fees and expenses incurred.
As used herein and throughout this Agreement, the term "attorneys' fees" shall
be deemed to include all fees incurred whether by attorneys, paralegals, legal
assistants or law clerks whether in pretrial, trial, appeal, bankruptcy,
collection or declaratory proceedings. The provisions of this paragraph shall
survive Closing and delivery of the Special Warranty Deed.
29. EXHIBITS. In the event that any exhibit which is referred to in
this Agreement is not attached hereto at the time of execution of this Agreement
by SELLER and BUYER, SELLER shall promptly cause any such missing exhibit to be
prepared and submitted to BUYER for BUYER's approval within five (5) days from
the Effective Date hereof. Upon approval of a given exhibit by BUYER, the same
shall be incorporated into this Agreement by written agreement executed by
SELLER and BUYER.
30. CONSTRUCTION. This Agreement has been negotiated between the
parties, each of whom have been represented by counsel. Accordingly, this
Agreement shall not be construed against either party as the drafter of the
Agreement in the event of any litigation with respect to it.
31. RADON GAS Radon is a naturally occurring radioactive gas that, when
it has accumulated in a building in sufficient quantities, may present health
risks to persons who are exposed to it over time. Levels of radon that exceed
federal and state guidelines have been found in buildings in the State in which
the Real Property is located. Additional information regarding radon and radon
testing may be obtained from your county public health unit.
32. VENUE. Venue for any legal proceeding hereunder shall be in the
State in which the Real Property is located.
33. WAIVER OF JURY TRIAL. SELLER and BUYER knowingly, voluntarily and
intentionally waive any right to trial by jury in respect to any litigation
arising out of, under or in connection with this Agreement or the transaction
described herein.
34. EFFECTIVE DATE. Unless otherwise set forth herein, the Effective
Date shall be the date this Agreement is executed by the SELLER, so long as
SELLER returns a fully executed duplicate original of this Agreement to the
BUYER, by either hand delivery or postmarked as of the date of the execution of
this Agreement by the SELLER. Each day of delay in returning the executed
Agreement to the BUYER shall likewise extend the Effective Date.
Page 15
35. COUNTERPART EXECUTION. This Agreement may be executed in several
counterparts, each of which shall be fully effective as an original and all of
which together shall constitute one and the same instrument.
36. FACSIMILE. A facsimile of this Agreement or any portion hereof,
including the signature page of any party, shall be deemed an original for all
purposes.
IN WITNESS WHEREOF, the parties hereto have hereunto set their hands
and seals the day and year indicated below.
WITNESSES: COMMUNITY ACQUISITION AND DEVELOPMENT
CORPORATION, a Delaware corporation
/s/Xxxxxxxx X. Xxxxxxxx By: /s/Xxxxxx X. Xxxxxx
----------------------------------- -----------------------------------
Print Name: Xxxxxxxx X. Xxxxxxxx Xxxxxx X. Xxxxxx, President
/s/Xxxxxx XxXxxxxxxx "BUYER"
-----------------------------------
Print Name: Xxxxxx XxXxxxxxxx
As to BUYER Buyer's Execution Date: March 1, 1999
RANCHO MIRAGE MOBILE HOME PARK,
an Arizona partnership
/s/Xxxxx XxXxxxxx By:/s/Xxxx XxXxxxxx
----------------------------------- -----------------------------------
Print Name: Xxxxx XxXxxxxx Print Name: Xxxx XxXxxxxx
Title: General Partner
/s/Xxxxxxxxx XxXxxxxx "SELLER"
----------------------------------- Seller's Execution Date: March 1, 1999
Print Name: Xxxxxxxxx XxXxxxxx
As to SELLER
JOINDER
______________________________ of Lawyers Title Insurance Company joins
in this Agreement of Sale for the sole purpose of agreeing to act as Escrow
Agent and to be legally bound to hold the Deposit in accordance with the
provisions in Paragraphs 3(a) and 22 hereof.
Lawyers Title Insurance Company, Escrow
Agent
By:
------------------------------------
Print Name:
------------------------
Page 16
SCHEDULE OF EXHIBITS
EXHIBIT "A" Metes and Bounds Description of the Property
EXHIBIT "B" Schedule of Personal Property
EXHIBIT "C" Rent Roll
EXHIBIT "D" Service Contracts
EXHIBIT "E" Phase I Environmental Audit Summary
Page 17
