REAL ESTATE CONTRACT OF SALE
XXXX XXXXXXX, Venture Manager (Seller), agrees to convey to HOMES FOR AMERICA
HOLDINGS, INC., a Nevada corporation (Purchaser), and Purchaser hereby buys and
agrees to pay for that certain real estate situated in Dallas County, Texas,
being a parcel of land having an area containing approximately 13 acres out of
the Xxxx Xxxxxx Survey, Abstract No. 545, in the City of Mesquite, Dallas
County, Texas, as described in the sketch on Exhibit A attached hereto,
incorporated herein, and made a part hereof for all purposes, including an
ingress and egress easement from the Property to Xxx Xxxxxxxxx Road (such
easement to be located in accordance with the mutual agreement of the parties;
together with all and singular the rights and appurtenances pertaining thereto,
including any right, title, and interest of the Seller in and to adjacent roads,
streets, alleys, rights-of-way, strips and gores (all of the foregoing being
collectively herein referred to as the "Property").
1. The purchase price for the Property is $1.16 per Gross Square Foot (as that
phrase is defined in Paragraph 4 below). The purchase price for the
Property is payable as follows:
a. Purchaser shall deposit xxxxxxx money in the amount of $25,000 (the
"Xxxxxxx Money") in escrow with Republic Title of Texas, Inc. (the
"Title Company") within three (3) days after this Contract has been
fully executed by the parties. The Xxxxxxx Money will be held in an
interest-bearing account by the Title Company for Purchaser's benefit
and account. At the Closing, the Xxxxxxx Money will be paid to Seller
and credited on the Purchaser's closing statement in partial
satisfaction of the purchase price. If Purchaser fails to deposit the
Xxxxxxx Money within the time specified above, Purchaser shall be in
default and Seller may, at Seller's option upon notice to Purchaser,
terminate this Contract and declare same to be null and void.
b. Cash in the amount of the purchase price will be payable to Seller by
Purchaser at Closing, in immediately available funds.
2. Seller shall deliver possession of the Property to Purchaser at Closing,
free and clear of all tenants and occupants of the Property. In the event
Seller fails to deliver such possession, Seller shall become and thereafter
be a tenant at sufferance of Purchaser and Seller hereby waives all notices
to quit provided by the laws of the State of Texas. The Closing (the
Closing Date or the Closing) will take place thirty (30) days after the
expiration of the Inspection Period, as defined in Paragraph 9 below, or on
such other date as the parties shall designate by written agreement. The
Closing will take place at the offices of the Title Company located at 0000
Xxxxxx Xxxxxx, 00xx Xxxxx, Xxxxxx, Xxxxx 00000.
3. Seller shall furnish to Purchaser, at Seller's sole cost and expense, a
preliminary title commitment (the Title Commitment) issued by the Title
Company for the Property as soon as possible after acceptance of this
Contract, but in any event within twenty (20) days after full execution of
this Contract, together with legible copies of all easements, restrictions,
and other encumbrances of record set forth as exceptions in the Title
Commitment. Purchaser shall have a period (the Review Period) of ten (10)
days from receipt of the latter of the Survey, as defined in Paragraph 4
below, and the Title Commitment in which to object to (i) any of said
exceptions contained in the Title Commitment or (ii) any matters shown on
the Survey. If Purchaser objects to either the Title Commitment or the
Survey, Purchaser shall notify Seller of such objections in writing within
said Review Period and Seller shall have a period (the Cure Period) of ten
(10) days during which to cure said objections. If Seller is unable to cure
said objections, if any, as set forth herein, Purchaser shall have the
right to (i) terminate this Contract and receive a refund of the Xxxxxxx
Money, except for the Option Fee, as defined herein; or (ii) accept such
title as Seller has and proceed to Closing, in which event it shall be
conclusively deemed that Purchaser has accepted such title as Seller has at
Closing subject only to the Permitted Exceptions, as defined herein. If
Purchaser does not deliver to Seller notice in writing of any such
objections prior to the expiration of the Review Period, Purchaser shall
waive the right to make such objections. If Purchaser does not deliver to
Seller written notice of Purchaser's election to terminate this Contract
within five (5) days after expiration of the Cure Period, Purchaser shall
waive said objections and Purchaser's right to terminate this Contract
pursuant to the terms set forth in this paragraph. For purposes of this
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Contract, the phrase Permitted Exceptions means only those exceptions
approved by Purchaser which are set forth in the Title Commitment or
disclosed on the Survey. Except as may be necessary to cure any title
objections of Purchaser, or to comply with ss. 6(b), from the effective
date hereof to the Closing, Seller shall not cause or permit any change in
the status of title to the Property or the physical condition of the
Property.
4. Seller shall furnish to Purchaser, at Purchaser's sole cost and expense,
within thirty (30) days after full execution hereof, a current perimeter
survey (the "Survey") of the Property made by a registered professional
surveyor licensed by the State of Texas who is acceptable to said Title
Company together with a metes and bounds description thereof with said
surveyor's field notes. The Surveyor's field notes shall be used as the
legal description on the Warranty Deed to be executed by Seller and
delivered to Purchaser at Closing. The Survey shall (i) locate and show
dimensions of all existing easements (setting forth book and page number),
alleys, streets, roads, and rights-of-way; (ii) show any encroachments
thereon or protrusions therefrom the Property; (iii) show all existing
improvements (such as buildings, power lines, fences, etc.); (iv) contain
the certificate of the surveyor that there are no encroachments or
protrusions affecting the Property, except as shown thereon; and (vi) the
surveyor's certification as to the number of square feet contained in the
Property. At Closing, Seller shall reimburse Purchaser for the cost of the
Survey, in an amount not to exceed $2,500. For purposes of this Contract,
the phrase Gross Square Feet means the gross area contained within the
perimeter boundaries of the Property. The purchase price of the Property
will be computed on the basis of the actual Gross Square Feet shown by the
Survey at the agreed price set forth in Paragraph 1 above.
5. Seller shall furnish to Purchaser, at Seller's sole expense, a Texas
standard form of Owner Policy of Title Insurance issued by Title Company,
to be delivered at the Closing (or reasonably soon thereafter), in the full
amount of the purchase price, insuring Purchaser fee simple title in the
Property, and containing no exceptions other than the Permitted Exceptions
and other than the other standard exceptions printed in the standard Texas
Owner Policy of Title Insurance, provided, however;
a. The exception as to restrictive covenants will be deleted, except for
such restrictions as may be included in the Permitted Exceptions.
b. The exception as to discrepancies in boundaries will be modified and
limited to shortages in area at Purchaser's option, and at Purchaser's
expense; and
c. The exception for taxes for the calendar year in which the Closing
occurs will be endorsed not yet due and payable, or taxes for the
current year fully paid, as the case may be.
6. At the time of Closing hereunder, Seller warrants and represents to
Purchaser each of the following:
a. That at the time of execution hereof each person executing this
Contract on behalf of Seller is fully authorized to do so and, at the
time of Closing, will be fully authorized to do so.
b. That Seller will have and convey to Purchaser good and indefeasible
title to the Property, free and clear of any and all encumbrances,
except the Permitted Exceptions.
c. That Seller is not a foreign person as defined in the Foreign
Investment in Real Property Tax Act of 1980 and the 1984 Tax Reform
Act, as amended.
7. SELLER AND PURCHASER ACKNOWLEDGE AND AGREE THAT EXCEPT AS EXPRESSLY SET
FORTH IN THIS CONTRACT, SELLER IS NOT MAKING AND HAS NOT AT ANY TIME MADE
ANY WARRANTIES OR REPRESENTATIONS OF ANY KIND OR CHARACTER, EXPRESS OR
IMPLIED, WITH RESPECT TO THE PROPERTY, INCLUDING, BUT NOT LIMITED TO, ANY
WARRANTIES OR REPRESENTATIONS AS TO HABITABILITY, MERCHANTABILITY, FITNESS
FOR A PARTICULAR PURPOSE, TITLE (OTHER THAN SELLER'S WARRANTY OF TITLE TO
BE SET FORTH IN THE DEED), ZONING, TAX CONSEQUENCES, PHYSICAL OR
ENVIRONMENTAL CONDITION, UTILITIES, OPERATING HISTORY OR PROJECTIONS,
VALUATION, GOVERNMENTAL APPROVALS, THE COMPLIANCE OF THE PROPERTY WITH
GOVERNMENTAL LAWS, OR THE TRUTH, ACCURACY OR COMPLETENESS OF THE PROPERTY
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DOCUMENTS. PURCHASER ACKNOWLEDGES AND AGREES THAT UPON CLOSING SELLER SHALL
SELL AND CONVEY TO PURCHASER AND PURCHASER SHALL ACCEPT THE PROPERTY "AS
IS, WHERE IS, WITH ALL FAULTS". EXCEPT TO THE EXTENT EXPRESSLY PROVIDED
OTHERWISE IN THIS CONTRACT, PURCHASER HAS NOT RELIED AND WILL NOT RELY ON,
AND SELLER IS NOT LIABLE FOR OR BOUND BY, ANY EXPRESS OR IMPLIED
WARRANTIES, GUARANTIES, STATEMENTS, REPRESENTATIONS OR INFORMATION
PERTAINING TO THE PROPERTY OR RELATING THERETO MADE OR FURNISHED BY SELLER,
OR ANY REAL ESTATE BROKER OR AGENT REPRESENTING OR PURPORTING TO REPRESENT
SELLER, TO WHOMEVER MADE OR GIVEN, DIRECTLY OR INDIRECTLY, ORALLY OR IN
WRITING. PURCHASER REPRESENTS TO SELLER THAT PURCHASER HAS CONDUCTED, OR
WILL CONDUCT PRIOR TO CLOSING, SUCH INVESTIGATIONS OF THE PROPERTY,
INCLUDING BUT NOT LIMITED TO, THE PHYSICAL AND ENVIRONMENTAL CONDITIONS
THEREOF, AS PURCHASER DEEMS NECESSARY TO SATISFY ITSELF AS TO THE CONDITION
OF THE PROPERTY AND THE EXISTENCE OR NONEXISTENCE OR CURATIVE ACTION TO BE
TAKEN WITH RESPECT TO ANY HAZARDOUS OR TOXIC SUBSTANCES ON OR DISCHARGED
FROM THE PROPERTY, AND WILL RELY SOLELY UPON SAME AND NOT UPON ANY
INFORMATION PROVIDED BY OR ON BEHALF OF SELLER OR ITS AGENTS OR EMPLOYEES
WITH RESPECT THERETO. UPON CLOSING, PURCHASER SHALL ASSUME THE RISK THAT
ADVERSE MATTERS, INCLUDING BUT NOT LIMITED TO, ADVERSE PHYSICAL AND
ENVIRONMENTAL CONDITIONS, WHICH MAY NOT HAVE BEEN REVEALED BY PURCHASER'S
INVESTIGATIONS, AND PURCHASER UPON CLOSING SHALL BE DEEMED TO HAVE WAIVED,
RELINQUISHED AND RELEASED SELLER FROM AND AGAINST ANY AND ALL CLAIMS,
DEMANDS, CAUSES OF ACTION (INCLUDING CAUSES OF ACTION IN TORT), LOSSES,
DAMAGES, LIABILITIES, COSTS AND EXPENSES (INCLUDING ATTORNEYS' FEES AND
COURT COSTS) OF ANY AND EVERY KIND OR CHARACTER, KNOWN OR UNKNOWN, WHICH
PURCHASER MIGHT HAVE ASSERTED OR ALLEGED AGAINST SELLER AT ANY TIME BY
REASON OF OR ARISING OUT OF ANY PHYSICAL CONDITIONS AND VIOLATIONS OF ANY
APPLICABLE LAWS (INCLUDING ANY ENVIRONMENTAL LAWS).
8. Purchaser hereby acknowledges that, at the time of the execution of this
Contract, the Brokers named below advised the Purchaser by this writing
that the Purchaser should have the abstract covering the real estate which
is the subject of this Contract examined by an attorney of the Purchaser's
own selection or that the Purchaser should be furnished with or obtain a
policy of title insurance.
9. Seller covenants and agrees that Purchaser shall have ninety (90) days (the
Inspection Period) next succeeding the date of acceptance of this Contract
by Seller within which to make any inspections, investigations, and
feasibility studies Purchaser deems necessary or appropriate. Purchaser may
conduct such soil tests, engineering, architectural and economic studies as
Purchaser deems necessary to determine whether or not the Property is
suitable for Purchaser's intended use. Promptly after the effective date of
this Contract, to the extent available to Seller and not previously
provided to Purchaser, Seller shall deliver to Purchaser true, correct, and
complete copies which are in Seller's possession of: (i) all leases,
occupancy agreements, and options affecting the Property (and all
amendments, certificates, and addenda thereunder); (ii) all existing
agreements, surveys, engineering tests or reports (and copies of all items
shown as title exceptions on the policy or report), plans or specifications
for any improvements, architectural or zoning documents, environmental
assessments, contracts, and reports, title insurance policies or reports,
and any other tests or reports, if any, relating to the Property and in
possession of Seller, or its employees, agents, representatives, or under
Seller's control; (iii) the plans and specifications for any Property
improvements; (iv) any and all appraisals of the Property in Seller's
possession; (v) all permits, certificates of occupancy, zoning variances,
inspection reports, government authorizations or approvals, licenses,
agreements, leases, and options of every kind and nature affecting the
Property; and (vi) copies of all real estate and personal property tax
bills (and assessment notices) for tax years 2000, 2001, and 2002, to the
extent available. If Purchaser determines within the Inspection Period that
the Property is not suitable to Purchaser, Purchaser shall have the option
to terminate and cancel this Contract by written notice to Seller, in which
event neither party shall have any further liability or obligation to the
other and the Xxxxxxx Money will be refunded promptly to Purchaser, except
for $100.00 (the Option Fee) which will be disbursed to Seller as
independent consideration for the granting of the option to terminate set
forth in this paragraph. The waiver by either party of any right, option,
or privilege set forth in this paragraph will not be deemed a waiver of any
other term, provision, or covenant of this Contract, and any such waiver
shall not affect any other obligations of the parties in this Contract.
Unless Purchaser has terminated this Contract previously, Purchaser shall
deposit with the Title Company additional Xxxxxxx Money in the amount of
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$25,000. If this Contract has not been previously terminated by Purchaser
and if Purchaser fails to deposit the additional Xxxxxxx Money prior to the
expiration of the Inspection Period, Purchaser shall be in default and
Seller may, at Seller's option, terminate this Contract and declare same to
be null and void by written notice to Purchaser. At Purchaser's option and
upon (i) payment to Seller in the amount of Ten Thousand Dollars ($10,000)
which will be non-refundable and credited on the purchase price at Closing,
and (ii) written notice to Seller prior to the expiration of the original
Inspection Period, Purchaser may extend the Inspection Period for one
additional period of thirty (30) days for the sole purpose of obtaining
rezoning of the Property by the City of Mesquite. If Purchaser determines
to seek rezoning of the Property, Purchaser covenants and agrees to pursue
diligently the application for rezoning at Purchaser's sole cost and
expense. In the event the application for rezoning is rejected by the City
of Mesquite, in that event, Purchaser will be entitled to a refund of all
Xxxxxxx Money, other than the Option Fee.
10. For a period of twenty (20) days next succeeding the full execution of this
Contract, Seller agrees to refrain from all further efforts to market the
Property and will not entertain any back-up offers.
11. Ad valorem taxes for the current year will be prorated at the Closing
effective as of the Closing Date. If the Closing occurs before the tax rate
is fixed for the then current year, the apportionment of taxes will be upon
the basis of the tax rate for the preceding year applied to the latest
assessed valuation. Purchaser shall be responsible for payment of all
roll-back taxes, if any.
12. If Seller is unable to convey title to the Property in accordance with this
Contract, Purchaser may, at Purchaser's option, terminate this Contract by
written notice delivered to Seller on or prior to the scheduled Closing
Date, otherwise, Purchaser shall be conclusively deemed to have accepted
Seller's title.
13. If this Contract is terminated by Purchaser pursuant to either Paragraphs
3, 9, or 12 hereof, the Xxxxxxx Money will be promptly refunded to
Purchaser, except for the Option Fee, and the parties shall have no further
obligation or liabilities hereunder one to the other.
14. If Seller fails to consummate this Contract for any reason, except
Purchaser's default, Purchaser may enforce specific performance of this
Contract or bring suit for damages against Seller, only if Seller, by
Seller's voluntary action, causes the remedy of specific performance to
become unavailable or Seller has otherwise voluntarily taken any action to
render the fee simple title to the Property unmarketable prior to Closing.
15. If Purchaser fails to consummate this Contract for any reason, except
Seller's default or the termination of this Contract pursuant to Paragraphs
3, 9 or 12 hereof, the Xxxxxxx Money will be paid to and accepted by Seller
as the agreed liquidated damages for such default as Seller's sole remedy.
The parties agree that such amount is a reasonable sum for liquidated
damages. This agreement is made because of the difficulty in ascertainment
of the amount of actual damages which Seller would sustain in the event of
default by Purchaser without legal excuse.
16. Any notice required or permitted to be delivered hereunder will be deemed
to be delivered, whether actually received or not, three (3) days after
such notice has been deposited in the United States mail, postage prepaid,
registered or certified mail, return receipt requested, addressed to Seller
or Purchaser as stated herein:
To Seller: Xxxx Xxxxxxx
Venture Manager
000 Xxxxx Xxxxxx Xxxxxx
Xxxxxx, Xxxxx 00000
Fax No. (000) 000-0000
With Copy To: Prager, Xxxxxxx and Xxxxxxx PLLC
Attn: Xxxxxx X. Xxxxxx, Esq.
0000 Xxxx Xxxxxx, Xxxxx 000
Xxxxxx, Xxxxx 00000-0000
Fax No. (000) 000-0000
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To Purchaser: Homes for America Holdings, Inc.
Attn: Xxxxxx X. XxxXxxxxxx, President & CEO
Xxx Xxxxx Xxxxx
Xxxxxxx, Xxx Xxxx 00000
Fax No. (000) 000-0000
With Copy To: Xxxxxx X. Xxxxx, Esq.
0000 Xxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, Xxxxxxxx 00000-0000
Fax No. (000) 000-0000
17. At the Closing, Seller shall execute and deliver to Purchaser each of the
following:
a. Possession of the Property.
b. Special Warranty Deed in recordable form conveying to Purchaser
indefeasible title to the Property in fee simple, free and clear of
any liens, assessments or encumbrances except the Permitted
Exceptions.
c. The Owner Policy of Title Insurance as specified in Paragraph 5.
d. Certificate that Seller is not a foreign person as defined in the
Internal Revenue Code.
e. An affidavit as to debts and liens and parties in possession in such
form as the Title Company may require.
f. Such documentary evidence as may be reasonably required by Title
Company evidencing the status and capacity of Seller and the authority
of the person or persons who are executing this Contract and the
various closing documents on behalf of Seller pursuant to this
Contract. 18. At the Closing, Purchaser shall execute and deliver to
Seller each of the following:
a. Cashier's check or wire transfer of immediately available funds
representing the purchase price specified in Paragraph 1.b above.
b. Such documentary evidence as may be reasonably required by Title
Company evidencing the status and capacity of Purchaser and the
authority of the person or persons who are executing this
Contract and the various closing documents on behalf of Purchaser
pursuant to this Contract.
19. At Closing, each party agrees to execute and deliver such other documents,
certificates, agreements, assignments, and other written instruments which
may be required by this Contract or which may be reasonably necessary or
appropriate in order to carry out and perform the terms, provisions,
covenants, and agreements contained herein in order to consummate the
transaction described in this Contract.
20. Each party hereto agrees that whether or not the transactions contemplated
hereby are consummated or not, at Closing or thereafter, each party hereto
shall pay its own legal fees and expenses incident to the preparation,
execution or performance of this Contract, except as may be otherwise
provided herein.
21. This Contract embodies the complete agreement between the parties hereto
and cannot be varied or terminated except by written agreement of the
parties.
22. This Contract is enforceable under, governed by, and construed in
accordance with the substantive laws of the state of Texas, without
reference to its conflicts of laws povisions.
23. This Contract may be executed in a number of identical counterparts. If so
executed, each of such counterparts is deemed to be an original for all
purposes and all such counterparts will, collectively, constitute one
agreement, but, in making proof of this Contract, it shall not be necessary
to produce or account for more than one such counterpart.
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24. Time is of the essence of this Contract and of the performance of each
term, covenant, and provision thereof. This Contract and all of its terms,
covenants, conditions, and provisions will inure to the benefit of and be
binding upon the parties, their respective successors, assigns, and legal
representatives.
25. Upon Closing, Seller agrees to pay to Xxxx Xxxxxxx (Agent), agent for
Sellers, and the Broker named below a real estate brokerage fee in the
amount of six percent (6%) of the first $500,000 of the purchase price and
three percent (3%) of the excess of the purchase price. Such real estate
brokerage fee will be shared equally by Agent and the Broker. Such real
estate brokerage fee will be paid in cash, but such payment is conditioned
upon Closing of the transaction described in this Contract. Purchaser
acknowledges that International Business & Realty Consultants, LLC is
Purchaser's real estate broker licensed in the Commonwealth of Virginia and
Purchaser will pay said agent a real estate referral fee in an amount equal
to two percent (2%) of the purchase price, payable at Closing. Each of the
parties warrant and represent to the other that except as set forth herein,
no other broker or agent has been engaged by either party and each party
agrees to indemnify and hold the other harmless of and from any claims
asserted by any other broker retained or engaged by such party.
26. This Contract may be assigned by Purchaser in whole or in part at least ten
(10) days prior to Closing to an assignee who assumes the obligations of
Purchaser under this Contract; however, Purchaser will not be released of
its obligations and liability hereunder. Purchaser shall furnish Seller a
copy of the fully executed assignment and assumption agreement.
27. The parties understand and agree that the feasibility of acquiring the
Property for Purchaser depends upon its ability to obtain, with the
thirteen (13) acres referenced in Exhibit A, certain additional acreage
owned by Seller and adjacent to the thirteen (13) acres, for Purchaser to
have at Closing direct access to Xxx Xxxxxxxxx Road for the Property by
extending the existing street east of Xxx Xxxxxxxxx Road which dead-ends at
Xxx Xxxxxxxxx Road (where a traffic light is currently located) westward
from Xxx Xxxxxxxxx Road to the easternmost boundary of the Property.
Promptly after the effective date hereof, and as part of obtaining the
Survey, the parties shall identify and agree upon such additional acreage,
to be included with the Property conveyed at Closing at the same price per
Gross Square Foot, which identified property shall be designated in an
amendment to this Contract.
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EXECUTED this 10th August, 2002.
AGENT FOR SELLERS: SELLER:
/s/ Xxxx Xxxxxxx /s/ Xxxx Xxxxxxx
-------------------------------- --------------------------------
Xxxx X. Xxxxxxx, Esq. Xxxx Xxxxxxx, Venture Manager
000 X. Xxxxxx Xxxxxx
Xxxxxx, Xxxxx 00000 PURCHASER:
Fax No. (000) 000-0000
HOMES FOR AMERICA HOLDINGS, INC.,
BROKER: a Nevada corporation
GRACE REALTY CORPORATION
/s/ Xxxxx Xxxxx /s/ Xxxxxx X. XxxXxxxxxx
-------------------------------- --------------------------------
By: Xxxxx Xxxxx, President By: Xxxxxx X. XxxXxxxxxx, President
00000 Xxxxxxxxx, Xxxxx X000
Xxxxxx, Xxxxx 00000
Fax No. (000) 000-0000
AGREEMENT OF ESCROW AGENT AND RECEIPT OF XXXXXXX MONEY
This Contract was deposited with Republic Title of Texas, Inc. on the ------ day
of ------------, 2002, and the Title Company executes this document for the
purposes of acknowledging receipt thereof, together with the Xxxxxxx Money in
the amount of $25,000, for the purposes of expressing its consent to act as
Escrow Agent in accordance with the provisions hereof.
REPUBLIC TITLE OF TEXAS, INC.
By:---------------------------------
Xxxxx Xxxxxxx, Senior Vice President
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