TRI-PARTY AGREEMENT
THIS TRI-PARTY AGREEMENT ("Agreement") is executed this 29th day of May,
1997, by and among NATIONSBANK OF TEXAS, N.A., a national banking association
("Construction Lender" or "NationsBank"), RED CANYON AT PALOMINO PARK LLC, a
Colorado limited liability company ("Borrower"), WELLSFORD PARK HIGHLANDS
CORP., a Colorado corporation ("WPHC"), WELLSFORD RESIDENTIAL PROPERTY TRUST, a
Maryland real estate investment trust ("WRPT"), XX XXXX, an individual resident
of Denver, Colorado ("Xxxx"), and THE XXXX COMPANY, a Colorado corporation.
R E C I T A L S:
X. Xxxx and WPHC, as members, are parties to that certain Operating
Agreement of Red Canyon at Palomino Park LLC, a Colorado limited liability
company, dated as of April 17, 1996, as amended by First Amendment to Operating
Agreement of Red Canyon at Palomino Park LLC dated as of May 19, 1997 (the
"Operating Agreement") evidencing the organization and formation of Borrower.
The Operating Agreement contemplates the development of a 304-unit apartment
complex and related facilities and amenities (the "Improvements") by Borrower
on certain real property located in Highlands Ranch, Xxxxxxx County, Colorado,
as more particularly described on Exhibit A attached hereto and made a part
hereof (the "Land") (the Land and the Improvements being referred to herein
collectively as the "Property"). All terms used herein with their initial
letters capitalized, unless otherwise defined herein, shall have the same
meaning as ascribed thereto in the Operating Agreement.
B. NationsBank has agreed, subject to compliance by Borrower with all of
the terms and conditions of the Construction Loan Agreement of even date
herewith (the "Loan Agreement") between NationsBank and Borrower, to make a
construction loan to Borrower (the "Loan") to provide funds for the acquisition
of the Land and the construction of the Improvements on the Land. In
connection with the Loan, Borrower has executed, among other instruments, a
Promissory Note of even date herewith (the "Note"), payable to the order of
NationsBank in the stated principal amount of $29,379,819.00 and a first lien
Construction Loan Deed of Trust, Assignment, Security Agreement and Financing
Statement of even date herewith (the "Mortgage"), encumbering the Property.
The Loan has been guaranteed by Xxxx and The Xxxx Company (collectively, the
"Guarantors") by separate Guaranty Agreements of even date herewith
(collectively, the "Guaranty Agreements") in favor of NationsBank. The Loan
Agreement, the Note, the Mortgage, and all other documents evidencing, securing
or otherwise pertaining to the Loan are referred to herein collectively as the
"Loan Documents."
C. The Operating Agreement contains a requirement that at the
Construction Loan Closing, Borrower, the Construction Lender and WRPT will
enter into an agreement providing, among other things, if the Loan has not been
paid in full by its maturity date, the Construction Lender shall have the right
to require that WRPT either purchase the Loan from the Construction Lender, or
at WRPT's option, cause the Loan to be repaid. The Loan Agreement also
contains a requirement that NationsBank, Borrower, WPHC and WRPT enter into an
agreement coordinating the payoff of the Loan by WRPT. This Agreement is being
entered into in compliance with the aforesaid requirements in the Operating
Agreement and the Loan Agreement.
AGREEMENTS
NOW, THEREFORE, in consideration of the mutual covenants contained herein,
and for other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties hereto agree as follows:
1. Subject to the satisfaction or waiver (by WRPT) of the conditions and
requirements listed in Exhibit B attached hereto and made a part hereof, WRPT
agrees to pay to NationsBank, on or before the maturity date of the Note, the
lesser of (i) the outstanding balance of all principal, interest and other
amounts owing to NationsBank in connection with the Loan (the "Outstanding Loan
Balance"), or (ii) the total of the Final Project Budget (the lesser of the
Outstanding Loan Balance and the total of the Final Project Budget is referred
to herein as the "Loan Payoff"). The Final Project Budget is defined in
paragraph 3 below and is subject to possible adjustment as provided in
paragraph 3. Upon its receipt of the Loan Payoff, NationsBank shall, at the
option of WRPT, either (a) assign to WRPT the Note, the Mortgage and all other
Loan Documents, without recourse or representation, except as to
title/ownership of the Loan Documents being transferred, or (b) cause the
Mortgage and all other liens and security interests on and against the Property
and securing the Loan to be released; provided, however, in connection with its
receipt of the Loan Payoff and such assignment of the Loan Documents or release
of the Mortgage, NationsBank shall retain its right to recover the difference,
if any, between the Outstanding Loan Balance and the Loan Payoff from
Guarantors under the Guaranty Agreements and shall also retain all of it rights
and remedies against Guarantors under the Environmental Indemnity Agreement and
all other indemnifications contained in the Loan Documents. When the Loan
Payoff is made, Borrower and WPHC shall execute and deliver such documents and
instruments as may be necessary to conform to the terms of the Operating
Agreement, and shall perform and observe all of the requirements of the
Operating Agreement to be performed and observed by Borrower and WPHC,
respectively, in connection with the Final Closing. Notwithstanding anything
contained in the Operating Agreement to the contrary, but subject to the
satisfaction or waiver (by WRPT) of the conditions and requirements listed in
Exhibit B hereto, WRPT shall be obligated to make the Loan Payoff to
NationsBank regardless of whether or not there is any uncured default on the
part of Xxxx, any Affiliate of Xxxx, or Borrower under the Operating Agreement
or under any other contracts or agreements relating to the Project.
2. WPHC and WRPT advise NationsBank that they have approved and
accepted, or have waived, the following items and conditions:
(a) The Initial Closing was completed in a timely manner, all of the
requirements and conditions set forth in Section 5.1 of the Operating Agreement
have been satisfied or waived, and WPHC has no right to remove Xxxx as a Member
or Manager of Borrower for any reason related to the Initial Closing.
(b) The Construction Loan Closing has been completed in a timely
manner, all of the requirements and conditions listed in Section 5.2 of the
Operating Agreement have been satisfied or waived, WPHC has approved all of the
documents and other items it is required to approve under Section 5.2 of the
Operating Agreement, and WPHC has no right to remove Xxxx as a Member or
Manager of Borrower for any reason related to the Construction Loan Closing.
Without limiting the foregoing, it is specifically acknowledged and agreed that
WPHC has approved all terms and conditions applicable to the Loan and all of
the Loan Documents as listed in Exhibit D attached hereto and made a part
hereof.
(c) The Infrastructure Land Closing was completed in a timely manner
and all of the requirements and conditions set forth in Section 5.3.1 of the
Operating Agreement have been satisfied. WPHC has also approved the
Infrastructure Improvements Agreement as described in Section 5.3.3 of the
Operating Agreement.
3. It is understood and agreed that WRPT has approved the budget for the
Loan, a copy of which is attached hereto and made a part hereof as Exhibit C,
and that said budget constitutes the Final Project Budget for purposes of the
Operating Agreement and this Agreement. The Final Project Budget is subject to
possible adjustment in accordance with the following provisions:
(a) In the event WPHC determines at any time that it is necessary or
appropriate to make any cash contribution ("Cash Contribution") to Borrower,
WPHC shall deliver written notice thereof to NationsBank prior to making the
Cash Contribution. As used herein, the term "Cash Contribution" also includes
amounts funded to Borrower from the proceeds of the "Bonds" (as defined in the
Loan Agreement) and used for the construction of the Improvements. To the
extent any such Cash Contribution (including Bond proceeds) is approved in
writing by NationsBank, in its sole and absolute discretion, and is actually
made to Borrower, the amount thereof shall be deducted from the total of the
Final Project Budget for purposes of calculating the Loan Payoff. In no event
shall any Cash Contribution (including Bond proceeds) made to Borrower which is
not approved in advance in writing by NationsBank be deducted from the Final
Project Budget.
(b) NationsBank shall have the right to make reallocations and other
adjustments to the line items in the Final Project Budget from time to time
without the necessity of obtaining any consent or approval from WRPT, provided
that WRPT's prior written approval shall be required for (i) any increases to
the total amount of the Final Project Budget and (ii) any decreases to the
interest reserve line item in the Final Project Budget. As between NationsBank
and Borrower, any such reallocations or adjustments shall be subject to the
terms and conditions of the Loan Agreement.
4. NationsBank shall not have the right to seek recovery against WRPT or
WPHC for any amount in excess of the Loan Payoff and, after its receipt of the
Loan Payoff, NationsBank shall not have the right to seek recovery against
Borrower if the Loan Payoff is less than the Outstanding Loan Balance; provided
that the foregoing shall not (i) limit the rights of NationsBank (as described
in paragraph 1 hereof) against Guarantors under the Guaranty Agreements, the
other Loan Documents, or otherwise or (ii) preclude NationsBank from naming
Borrower as a party in any suit against Guarantors (although NationsBank may
not obtain any recovery from Borrower after its receipt of the Loan Payoff).
The provisions of this paragraph 4 shall survive the delivery of the Loan
Payoff to NationsBank and the closing of the transaction described in
paragraph 1.
5. WPHC and WRPT are aware that (i) the Property is subject to, among
other assessment agreements and liens related thereto, an Indemnification
Assessment and Lien (the "Indemnification Assessment Lien"), dated as of May 2,
1996, recorded in Book 1338 at Page 2006 in the Office of the Clerk and
Recorder of Xxxxxxx County, Colorado and relating to certain indemnification
obligations of Palomino Park Public Improvements Corporation (the
"Corporation") in favor of Highlands Ranch Metropolitan District No. 2 in
connection with the Bonds; and (ii) the Indemnification Assessment Lien is
prior to the lien of the Mortgage. Notwithstanding anything contained herein
to the contrary, it is agreed that upon the occurrence of any default under the
Indemnification Assessment Lien WRPT shall be obligated to either, at its
option, (i) pay all amounts necessary to cure the default under the
Indemnification Assessment Lien to the Corporation or to NationsBank (if
NationsBank has made the payment necessary to cure such default, although
NationsBank shall not be required to do so), or (ii) pay the Loan Payoff to
NationsBank in accordance with the provisions of paragraph 1 hereof, even if
not all of the conditions and requirements listed in Exhibit B hereto are
satisfied at such time (and if WRPT exercises the option under this clause (ii)
the Loan Payoff shall include all amounts paid by NationsBank, if any, to cure
such default). WRPT shall make its election under either clause (i) or clause
(ii) of the preceding sentence, and shall make the appropriate payment to the
Corporation or to NationsBank, no later than ten (10) days after the
commencement of any foreclosure or other enforcement proceeding by the
Corporation with respect to the Indemnification Assessment Lien.
6. Borrower, WPHC and WRPT agree that the Operating Agreement will not
be modified or amended in any manner which could affect the security or
interests of NationsBank without the prior written consent of NationsBank. The
provisions of this paragraph 6 shall no longer apply after the Loan Payoff has
been made to NationsBank.
7. WPHC represents and warrants to NationsBank that, as of the date
hereof, to the best of WPHC's knowledge, there is no uncured default by Xxxx or
any Affiliate of Xxxx under the Operating Agreement or any of the Approved
Affiliate Agreements, and WPHC is not aware of any occurrence or condition
which, with the giving of notice or passage of time, or both, could constitute
a default by Xxxx or any Affiliate of Xxxx under the Operating Agreement or any
of the Approved Affiliate Agreements. As used herein, the phrase "to the best
of WPHC's knowledge" shall mean the current actual knowledge of WPHC and shall
not imply any inquiry or investigation other than a review of all relevant
files in the possession of WPHC.
8. All of the parties hereto acknowledge and agree that this Agreement
satisfies the requirements and conditions for a tri-party agreement under both
the Operating Agreement and the Loan Agreement.
9. In the event any default occurs under the Loan Documents, NationsBank
agrees to deliver to WRPT a copy of any notice of default sent by NationsBank
to Borrower (the "Default Notice") and further agrees not to accelerate the
maturity of the Note if WRPT, within thirty (30) days after the date of the
Default Notice (the "Cure Period"), either (a) cures or causes to be cured such
default (it being agreed that WRPT shall have no obligation to cure any such
default), or (b) notifies NationsBank of its willingness to pay and satisfy or
purchase the Loan from NationsBank by payment of the outstanding balance of
principal and interest owing thereon (but not in excess of the amount of the
Loan Payoff), as well as any costs that have been incurred by NationsBank as a
result of such default, within ten (10) days after expiration of the Cure
Period and WRPT does so pay and satisfy or purchase the Loan within ten (10)
days after expiration of the Cure Period. Any Default Notice delivered by
NationsBank to WRPT pursuant to this paragraph 9 shall include a written
statement of the amount necessary to pay and satisfy or purchase the Loan from
NationsBank. Since the final amount of accrued interest and actual costs
incurred by NationsBank as a result of the default may not be known at the time
NationsBank delivers the Default Notice, it is agreed that such payoff
statement may include a per diem amount for accrued interest and may include an
estimate of costs, with NationsBank reserving the right to collect all costs
actually incurred by NationsBank in connection with the default (if the actual
costs exceed the estimated costs). If WRPT elects to purchase the Loan from
NationsBank as aforesaid, then the closing shall be held through the office of
the same title company in Denver, Colorado which handled the closing of the
Loan on the date specified by WRPT in its notice of election to purchase, which
date shall not be later than ten (10) days after expiration of the Cure Period.
Notwithstanding anything contained herein to the contrary, in no event shall
NationsBank be obligated to give a Default Notice to WRPT with respect to any
default that NationsBank is not required to give notice of to Borrower under
the Loan Documents.
10. Any notice or communication required or permitted to be given
hereunder shall be in writing and shall be deemed to be delivered when actually
received or, regardless of whether actually received or not, (a) one (1)
business day after deposited with Federal Express, Xxxxx, DHL, UPS, or other
overnight air courier service, (b) twenty-four (24) hours after transmitted by
facsimile, with evidence of transmission attached and hard copy sent by United
States mail, or (c) three (3) days after deposited in the United States mail,
postage prepaid, registered or certified mail, return receipt requested,
addressed to the addressee as follows or to such other address or facsimile
number as shall hereafter be designated by written notice from the addressee
actually received by the other parties at least twenty (20) days prior to the
effective date of the change:
NationsBank: NationsBank of Texas, N.A.
Real Estate Banking Group
000 Xxxx Xxxxxx, 00xx Xxxxx
Xxxxxx, Xxxxx 00000
Attn: Real Estate Loan Administration
Facsimile No. 214/508-1571
with copy to: Xxxxxxx X. Xxxxx
Xxxxxx & Xxxxxxx, L.L.P.
Xxx XxxxxXxxx Xxxx, Xxxxx 000
0000 Xxxxx Xxxxxxx Xxxxxxxxxx
Xxxxxx, Xxxxx 00000
Facsimile No. 214/373-8768
Borrower: c/o Xx. Xx Xxxx
The Xxxx Company
0000 Xxxxx Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxx, Xxxxxxxx 00000
Facsimile No. 303/721-9418
with copy to: Xxxx X. Xxxxxxx
Haligman & Lottner, P.C.
000 00xx Xxxxxx, Xxxxx 0000, Xxxxx Xxxxx
Xxxxxx, Xxxxxxxx 00000
Facsimile No. 303/292-1300
WPHC and WPRT: x/x Xxxxxxxxx Xxxxxxxxxxx Property Trust
000 Xxxxxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxxxxx 00000
Attn: Xxxxx X. Xxxxxx
Facsimile No. 303/595-7799
with copies to: Wellsford Residential Property Trust
000 Xxxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxxxx Xxxxxxx
Facsimile No. 212/333-2323
and to: Xxxxx X. Xxxxx
Xxxxxxxxxx Hyatt Xxxxxx & Xxxxxxxxxx, P.C.
000 Xxxxxxxxxxx Xxxxxx, 00xx Xxxxx
Xxxxxx, Xxxxxxxx 00000
Facsimile No. 303/623-1956
11. With respect to the relationship among NationsBank, Borrower,
Guarantors, WPHC and WRPT, in the event of any conflict or inconsistency
between the terms, provisions or conditions of this Agreement, on the one hand,
and the terms, provisions or conditions of the Operating Agreement or the Loan
Agreement, on the other hand, this Agreement will govern. However, the terms
of the Operating Agreement will govern the relationship among the members of
Borrower and the relationship between Borrower and WRPT.
12. If any party shall be required to employ an attorney to enforce or
defend the rights of such party hereunder, the prevailing party or parties
shall be entitled to recover reasonable attorneys fees and costs.
13. This Agreement may be executed in any number of counterparts, each of
which shall be deemed to be an original and all of which taken together shall
constitute one and the same instrument.
14. This Agreement may be changed, terminated or modified only by
agreement in writing signed by all of the parties hereto.
15. The covenants, agreements and rights contained in this Agreement
shall be binding upon and shall inure to the benefit of the respective
successors and assigns of the parties hereto and all persons claiming by,
through or under any of them. Without limiting the foregoing, it is agreed
that any transfer or assignment of the Loan by NationsBank shall be expressly
made subject to this Agreement and that the transferee or assignee will also be
entitled to the rights and benefits of NationsBank under this Agreement. In
addition, NationsBank agrees to deliver written notice to WRPT within a
reasonable period of time after any such transfer or assignment of the Loan.
16. This Agreement has been executed by the undersigned signatory on
behalf of WRPT in his/her capacity as an officer or trustee of WRPT which has
been formed as a Maryland real estate investment trust pursuant to a
Declaration of Trust of WRPT dated as of July 10, 1992, and not individually,
and neither the trustees, officers or shareholders of WRPT shall be bound by or
have any personal liability hereunder or thereunder. The other parties hereto
shall look solely to the assets of WRPT for satisfaction of any liability of
WRPT in respect of this Agreement and will not seek recourse or commence any
action against any of the trustees, officers or shareholders of WRPT
individually or against any of their personal assets for the performance or
payment of any obligation hereunder or thereunder. The foregoing shall also
apply to any and all future documents, agreements, understandings, arrangements
and transactions between the parties hereto with respect to the subject matter
of this Agreement.
17. THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF TEXAS AND SHALL BE PERFORMABLE IN DALLAS COUNTY, TEXAS.
18. THIS AGREEMENT REPRESENTS THE FINAL AGREEMENT BETWEEN THE PARTIES
REGARDING THE SUBJECT HEREOF AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR,
CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES.
THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.
[Signature pages follow]
IN WITNESS WHEREOF, the parties have duly executed this Agreement as of
the day and year first above written.
CONSTRUCTION LENDER:
NATIONSBANK OF TEXAS, N.A., a national
banking association
By: /s/ Xxxxxx X. Xxxxxxxx
----------------------------
Name: Xxxxxx X. Xxxxxxxx
---------------------
Title: Vice President
---------------------
BORROWER:
RED CANYON AT PALOMINO PARK LLC, a
Colorado limited liability company
By: /s/ Xx Xxxx
----------------------------
Xx Xxxx, Manager
WPHC:
WELLSFORD PARK HIGHLANDS CORP., a
Colorado corporation
By: /s/ Xxxxx X. Xxxxxx
----------------------------
Xxxxx X. Xxxxxx
Vice President
WRPT:
WELLSFORD RESIDENTIAL PROPERTY TRUST,
a Maryland real estate investment trust
By: /s/ Xxxxx X. Xxxxxx
----------------------------
Xxxxx X. Xxxxxx
Vice President
GUARANTORS:
/s/ Xx Xxxx
---------------------------------
Xx Xxxx
THE XXXX COMPANY, a Colorado corporation
By: /s/ Xx Xxxx
----------------------------
Xx Xxxx
President
EXHIBIT A
LEGAL DESCRIPTION
EXHIBIT B
1. Delivery to WPHC of a payoff letter from NationsBank setting forth the
total of all principal, interest and other amounts owing to NationsBank in
connection with the Loan.
2. The Title Insurance Company shall be irrevocably committed to issue the
following endorsements to the Owner's Title Policy issued to Borrower in
connection with the Construction Loan Closing (said endorsements to be
issued at the time of the Loan Payoff):
(a) A "date down" endorsement to the Title Policy extending the effective
date of the Title Policy to the date of funding and showing no
exceptions to title other than the exceptions reflected on the
existing Title Policy and any other exceptions which are reasonably
acceptable to or have been previously approved in writing by WPHC.
(b) An endorsement increasing the amount of insurance by an amount equal
to the Final Closing Capital Contribution.
(c) Such other endorsements as WPHC may reasonably require and the Title
Insurance Company is willing to issue. Such additional endorsements
shall be at WPHC's sole cost and expense.
3. Delivery to WPHC of unconditional lien releases from all subcontractors,
materialmen and providers of labor, equipment, material and/or services to
the Property, as to all work performed and materials purchased in
connection with the construction of the Project (which by definition, does
not include the Infrastructure), in form reasonably satisfactory to WPHC
or, with respect to any liens not so released, Xxxx shall have provided
surety bonds to which any contested liens are transferred (and released
from the Property) and title insurance over any such liens.
4. Delivery to WPHC of a physical inspection report prepared by the
Construction Consultant under the Operating Agreement or, alternatively, a
copy of a physical inspection report prepared by the construction
inspector under the Loan Agreement and addressed to WPHC.
5. Delivery to WPHC of an as-built survey reasonably satisfactory to WPHC
dated no more than thirty (30) days prior to the date of funding, showing
no encroachments or other adverse matters affecting title to the Property,
except as shall be reasonably acceptable to or have been previously
approved in writing by WPHC. WPHC acknowledges that it has approved the
ALTA/ACSM Land Survey of the Property prepared by X. X. Xxxxxxxx &
Associates, Inc. dated May 23, 1997, Job No. 788.01.
6. Delivery to WPHC of a written document executed by Xxxx, the architect and
the general contractor certifying no material change to the approved "for-
construction" plans and specifications for the Project except any changes
stated therein that have previously been approved by WPHC.
7. Delivery to WPHC of a copy of the final and unconditional certificate or
certificates of occupancy issued by the appropriate governmental
authorities for the Project in its entirety and a copy of any permits and
licenses which are required for the operation and use of the Project.
ED Delivery to WPHC of an Architect's Certificate substantially in the form
attached hereto as Exhibit B-1. [Note: This will be the same form as
attached to the Operating Agreement as Exhibit S-1.]
9. Delivery to WPHC of an Engineer's Certificate substantially in the form
attached hereto as Exhibit B-2. [Note: This will be the same form as
attached to the Operating Agreement as Exhibit S-2.]
10. Delivery to WPHC of satisfactory evidence (which may be in the form of an
endorsement to the Title Policy described in item 2 above) that all real
property taxes and assessments for the Property which are due and payable
through the date of funding have been fully paid.
11. Delivery to WPHC of a Release and Waiver, substantially in the form
attached hereto as Exhibit B-3, from Xxxx and each Affiliate of Xxxx that
is a party to an Approved Affiliate Agreement [Note: This will be the
same form as attached to the Operating Agreement as Exhibit B-3].
EXHIBIT B-1
------------------
Form of Architect's Certificate
(Letterhead of Architect)
CERTIFICATE OF ARCHITECT
______________, 1997
Red Canyon at Palomino Park LLC
Wellsford Residential Property Trust
000 00xx Xxxxxx, Xxxxx 0000
Xxxxxx, XX 00000
Reference: ___________________________
_________________, Colorado
Ladies and Gentlemen:
Please refer to the final architectural plans and specifications reflecting all
field notes and field changes as built described in the attached Exhibit A (the
"Plans"). The undersigned understands that ___________________________ or its
designee ("Wellsford") is acquiring an interest in or is causing the repayment
of the construction loan for a residential complex owned by Red Canyon at
Palomino Park LLC, a Colorado limited liability company ("Owner"), located on
that certain parcel of real property having an address of ___________________
in the City of ___________________________, County of _________________, State
of Colorado and described on Exhibit B attached hereto (the "Site"), on which
Owner has constructed a complex of apartment units known as ___________________
(the "Project"). This Certificate is a condition precedent to Wellsford's
acquiring the Project or repaying such loan, and the undersigned acknowledges
that Wellsford will be relying upon this Certificate in consummating such
transaction.
With such understanding, the undersigned has reviewed the Plans, the
construction of the Project in relationship to the Plans, and its conformity
and compliance with applicable laws and regulations (i.e., applicable federal,
state, county and municipal laws and regulations and ordinances, including
without limitation, governing building and fire codes, zoning, subdivision and
land use laws and regulations, environmental and safety statutes and
regulations, and the rules and regulations of other governmental agencies
having jurisdiction over the Site or the Project ("Applicable Laws"). Based
upon these reviews and upon due professional investigation, the undersigned
declares and certifies to and for the benefit of Owner and Wellsford that:
1. The undersigned is the architect who prepared the Plans and coordinated
and supervised the construction of the Project.
2. The Project commonly known as ___________________________ contains 456
apartment units in ______ buildings, and _____________ parking spaces,
with related amenities and facilities. The Site is zoned
___________________________ under the applicable ordinances of the City of
___________________________, Colorado.
3. We have examined all applicable materials relative to those types of
restrictions and requirements sometimes referred to as use, dimensional,
bulk and parking restrictions, jurisdictional wetlands requirements,
setback and buffering requirements, density restraints, landscaping and
vegetation preservation ordinances, laws, rules and regulations and
environmental restraints, which relate to the Site (hereinafter referred
to as "Development Constraints") and have determined that the Project is
permitted as a matter of right except for the following variances:
___________________________, and that the following restrictions and
requirements (the "Restrictions and Requirements") are applicable to the
Project:
Minimum Lot Area:
Height Limitation:
Maximum Floor Area Ratio
(or other type of bulk
-bulk restriction):
Limitation on Number of
Dwelling Units (if any):
Front Yard Requirements:
Side and Rear Yard
Requirements:
Parking Requirements:
4. The Project and the Site are in compliance with the Development
Constraints and the Restrictions and Requirements.
5. The improvements contemplated by the Plans have been completed in
substantial compliance with the Plans, except for the items in the
attached Exhibit C which are incomplete to the extent indicated and for
which the estimated cost to complete is indicated on said Exhibit C.
6. We are of the opinion that the Project has been designed in accordance
with the applicable provisions of Colorado law, the Americans with
Disabilities Act of 1990, 42 U.S.C. Section 12101, et seq., as amended,
and any other applicable law, rule or regulation of any kind or
description relating to the elimination of architectural barriers for the
handicapped.
7. We certify that any and all amounts due and payable to us under or in
connection with the Standard Form of Agreement between Owner and Architect
for Housing Services (AIA-Document B181) dated ___________________________
with regard to the Project have been paid in full.
8. The Project, the Plans and all improvements comply with Applicable Laws,
including without limitation, the applicable PUD, and with all necessary
and required notices, permits or license agreements in connection with the
Plans, and all permits, licenses and approvals required for the
construction of the improvements contemplated by the Plans and for the use
and occupancy of the Project (including, without limitation, all final
certificates of occupancy) have been obtained from the applicable
governmental or quasi-governmental agency having jurisdiction or any
private party from whom any license is required.
9. The improvements are ready for occupancy.
10. The improvements on the Property, contain a minimum of ________________
square feet of net rentable living area (as measured from inside face of
exterior wall to apartment side of corridor wall to centerline of tenant
separation wall) for the apartments.
11. The undersigned is a licensed architect and has the power and authority to
render this Certificate and to execute and deliver it on behalf of Xxxx
Design, Inc.
This Certificate may be relied upon only by Wellsford and the Owner.
Very truly yours,
By: Xxxxxx X.X. English
Supervising Architect
Dated:____________________________
EXHIBIT B-2
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Form of Engineer's Certificate
(Letterhead of Project Engineer)
ENGINEER'S CERTIFICATE
_________________, 1997
Red Canyon at Palomino Park LLC
Wellsford Residential Property Trust
000 00xx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxxxxx 00000
Reference: ___________________
_______________, Colorado
Ladies and Gentlemen:
The undersigned understands that ___________________________ or its designee
("Wellsford") is acquiring an interest in or is causing the repayment of the
construction loan for a residential complex owned by Red Canyon at Palomino
Park LLC, a Colorado limited liability company ("Owner"), located on that
certain parcel of real property having an address of ________________ in the
City of __________________________, County of __________________, State of
Colorado and described on Exhibit A attached hereto (then "Site"), on which
Owner has constructed a complex of ________ apartment units known as (the
"Project"). This Certificate is a condition precedent to Wellsford's acquiring
the Project or repaying such loan, and the undersigned acknowledges that
Wellsford will be relying upon this Certificate in consummating such
transaction.
With such understanding, the undersigned has reviewed those portions of the
plans and specifications for the Project that are listed on Exhibit B attached
hereto (the "Engineering Plans"), the construction of the Project in
relationship to the Engineering Plans, and its conformity and compliance with
certain applicable laws and regulations. Based upon these reviews and upon due
professional investigation, the undersigned declares and certifies to and for
the benefit of Owner and Wellsford that:
1. Satisfactory methods of access to and egress from the Site and the Project
and adjoining or nearby public ways are available and are sufficient to
meet the reasonable needs of the Project and all applicable requirements
of public authorities. Sanitary water supply and storm sewer and sanitary
sewer facilities and other required utilities (gas, electricity,
telephone, etc.) are likewise available and are sufficient to meet the
reasonable needs of the Project and all applicable requirements of public
authorities.
2. We are of the opinion that the Property is not located in a 100-Year Floor
plain or in an identified "flood prone area," as descried by the U.S.
Department of Housing and Urban Development, pursuant to the Flood
Disaster Protection Act of 1973, as amended, and is not subject to any
federal, state or local "wetlands" rules, regulations, ordinances or
requirements.
3. We have reviewed and are familiar with all tests and analyses performed
and professional recommendations made by soil engineers and other
consultants regarding the condition of the soil of the Site. In our
professional opinion, the condition of the soil of the Site is adequate to
support the Project as completed.
4. We have reviewed the locations of all easements, rights-of-way, subsurface
rights of jurisdictional wetlands, and all rules and regulations
pertaining to the same in force relating to the Site, and the Plans are
prepared so that the Project does not encroach over, across or upon any
such easements, rights-of-way, subsurface rights or jurisdictional
wetlands and the like, and all necessary permits and approvals required
for the Project have been obtained.
5. We have reviewed all deeds, easements, covenants, restrictions and other
matters set forth in Schedule B of Title Commitment No. __________ issued
by Land Title Guaranty Company, and the Project satisfies and/or does not
violate any provisions concerning construction of improvements on the Site
set forth in such deeds, easements, covenants, restrictions and other
matters.
This Certificate may be relied upon only by Owner and Wellsford.
Very Truly yours,
[ENGINEER]
By:__________________________
Title:______________________
Dated:_____________________
EXHIBIT C
APPROVED BUDGET
Land Costs
----------
Land $2,123,119
Site Improvements 5,127,247
Hard Costs
----------
Construction Contract 16,518,058
Amenities 845,782
General Conditions/Permits 1,133,204
Soft Costs
----------
Architectural 148,000
Engineering 317,800
Title Insurance 21,280
Legal 40,000
Appraisal and Environmental Audit 7,500
Construction Management Fee 608,000
Reproduction Costs 16,000
Landscape Architect 42,000
Interior Design 20,000
Accounting/Tax Returns 10,000
Developer's Fee 304,000
Real Estate Taxes 30,000
Systems Development Fee 505,500
Lender/Owner Inspections 15,200
NationsBank Loan Fee 146,899
Guaranty Fee 293,748
NationsBank Loan Interest 1,634,789
Contingency 674,643
___________
TOTAL $30,579,819
Less Borrower's
Upfront Equity 1,200,000
___________
TOTAL LOAN AMOUNT $29,379,819
EXHIBIT D
SCHEDULE OF LOAN DOCUMENTS
[Unless indicated otherwise, all of the following Loan Documents are dated as
of May 29, 1997.]
1. Construction Loan Agreement.
2. Promissory Note.
3. Guaranty Agreement of Xx Xxxx.
4. Guaranty Agreement of The Xxxx Company.
5. Construction Loan Deed of Trust, Assignment, Security Agreement and
Financing Statement.
6. UCC-1 Financing Statements.
7. Assignment of Rents and Leases.
8. Environmental Indemnity Agreement.
9. Collateral Assignment of Management Agreement.
10. Manager's Agreement, Subordination and Consent to Assignment.
11. Assignment of Construction Contract.
12. Contractor's Subordination, Agreement and Consent to Assignment of
Construction Contract.
13. Assignment of Construction Documents.
14. Architect's Consent to Assignment, Agreement and Subordination of Lien.
15. Certification of Non-Foreign Status.
16. Notice by Disburser.
