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Dominion Homes - Real Estate Purchase Agreement
REAL ESTATE PURCHASE AGREEMENT
THIS REAL ESTATE PURCHASE AGREEMENT ("Agreement") is made and entered into as of the date set forth below, by and between DOMINION HOMES, Inc. an Ohio Corporation ("Seller"), and ASC REAL ESTATE DEVELOPMENT, L.L.C., a Utah Limited Liability Company ("Buyer").
Recitals
Seller is the owner of certain real property as set out on Exhibit A attached hereto (the "Real Property").
Buyer desires to purchase from Seller the Real Property, and certain other tangible and intangible property related to the Real Property as described herein, for the purpose of the development thereon (the "Project").
Agreement
NOW, THEREFORE, in consideration of the mutual covenants of the parties and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Seller and Buyer agree as follows:
ARTICLE I
Basic Definitions
ALTA Survey. The term "ALTA Survey" shall mean a survey and topography map of the Real Property prepared by a licensed surveyor or professional engineer in accordance with "Minimum Standard Detail requirements for ALTA/ACSM Land Title Surveys", jointly established and adopted in 1992 by the American Land Title Association and American Congress on Surveying and Mapping, or the equivalent thereof. Said ALTA Survey shall also be provided on a 3.5, 1.44-megabyte computer disk in AutoCAD format, release 12, DWG format, which shall also include all reference files that apply to the drawing.
Affidavit of Non-Foreign Status. "Affidavit of Non-Foreign Status" shall mean a document to be executed by Seller for the purpose of complying with exemption (b) (2) of Internal Revenue Code Section 1445 relating to the withholding of tax upon the sale of certain real estate by a "foreign person" as defined in I.R.C. Section 1445.
Approvals Period. "Approvals Period" shall commence on the day, which falls after the expiration of the Feasibility Period, and end at 11:59 p.m. thirty (30) days thereafter
Closing Date. "Closing Date" shall mean the date, which is fifteen (15) days following the earlier of (i) close of the Inspection Period or (ii) the date on which Buyer determines that all Approvals have been received (if later than the expiration of the Feasibility Period). If any date set for Closing shall be a Saturday, Sunday, or legal holiday, then Closing shall occur on the next succeeding business day.
Date of this Agreement. "Date of this Agreement" shall mean the date on which the last party hereto signs and dates this Agreement below.
Deposit. "Deposit" shall mean five thousand dollars and zero cents ($5,000.00) deposited by buyer as earnest money to show the buyer's intent to purchase the Real Property.
Escrow. "Escrow" shall mean the Escrow established with the Title Company to effect the purchase and sale
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contemplated by this Agreement, as described more fully in Article VI below.
Feasibility Period. "Feasibility Period" shall commence on the Date of the Agreement and end at 11:59 pm. sixty (60) days thereafter
Governmental Unit. "Governmental Unit" means any federal, state, county, city, or other unit of government, or any instrumentality thereof.
Inspection Period. "Inspection Period" shall mean the Feasibility Period together with the Approvals Period.
Net Square Feet. If used herein, "Net Square Feet" shall mean the gross area of the Real Property (as determined by the ALTA Survey and accepted by Buyer) less the square feet of property located within rights of way for public roadways and/or public alleys.
Phase I Report. "Phase I Report" shall mean a Phase I environmental assessment of the Real Property, in form and substance and with an environmental testing company reasonably acceptable to Buyer.
Property. "Property" shall mean the Real Property, together with (to the extent they exist) any and all easements, rights-of-way, privileges, hereditaments, governmental licenses, zoning rights, development rights, sanitary sewer discharge treatment rights, and potable water capacities, applications, rights and powers appurtenant to or for the benefit of the Real Property, all remainder interests, reversionary interests, permits and approvals relating to the Real Property held by Seller, and any and all existing warranties with respect to the Real Property given to Seller by third parties. Seller will provide Buyer with and approved boundary survey and legal description of the Property.
Purchase Price. The "Purchase Price" shall be seven hundred thirty thousand dollars and zero cents ($730,000.00).
Title Commitment. "Title Commitment" shall mean a commitment (in a form reasonably acceptable to Buyer) by the Title Company to issue a standard ALTA owner's title insurance policy covering the Real Property in the amount of the Purchase Price.
Title Company. "Title Company" shall mean Title First Agency, Inc.
Title Policy. "Title Policy" shall mean a title policy issued in accordance with the Title Commitment, subject only to the Permitted Exceptions (as defined below), and with the exceptions for mechanic's liens, taxes, survey matters, and parties in possession deleted from said policy; together with such additional endorsements as Buyer may require (provided, that notwithstanding any other provision hereof, such additional endorsements shall be at Buyer's sole cost and expense).
ARTICLE II
Purchase and Sale
Seller agrees to sell the Property to Buyer, and Buyer agrees to purchase the Property from Seller, upon all of the terms, covenants and conditions set forth in this Agreement. The purchase price for the Property (the "Purchase Price") shall be the Purchase Price, and shall be payable by Buyer to Seller on the Closing Date as follows:
a) Buyer has deposited or shall deposit with the Title Company within five (5) business days from the date of
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this Agreement (or, if later, within two (2) business days after the opening of the escrow account), any Deposit required hereunder. At Closing, or if the transaction shall fail to close for any reason other than as set forth in Article V below, the Deposit and any proceeds thereof, together with any interest earned thereon, shall be delivered to Buyer or, at Buyer's direction, drawn down and credited against the Purchase Price.
b) The Purchase Price shall be paid to Seller by (i) at Buyer's direction, crediting the Deposit, any payment under the Deposit, and any other payments including any interest earned thereon, to the account of the Seller at the Title Company, and (ii) the balance shall be paid by wire transfer of immediately available funds on the Closing Date to the Title Company for disbursement at Closing.
c) Seller shall deliver to Buyer on the Closing Date, a statutory form of general warranty deed to the Real Property (the "Deed"), together with such other instruments of conveyance or documents as may be necessary to convey the Property to Buyer.
ARTICLE III
Investigation and Review
Section 3.1 Inspections of Property and Documents. During the Inspection Period Buyer shall be permitted to make a complete physical inspection of the Property and a review of all documents and information in Seller's possession relating to the Property. Seller shall deliver to Buyer copies of all environmental reports, soils tests, surveys, plats, correspondence with Governmental Units, legal proceedings, threats of legal proceedings, current tax statements, and assessments, and copies of any other documents reasonably identified from time to time by Buyer, that are in Seller's possession, custody, or control pertaining to the Property within ten (10) days after the Date of this Agreement. Seller shall permit Buyer and its agents such access to the Real Property and any structures located thereon as Buyer may request during the Inspection Period (including any extensions) for the purpose of making assessments, investigations, inspections, and tests, and shall cooperate with Buyer with respect to the foregoing investigations but shall not be obligated to incur any out-of-pocket expense in connection therewith. Buyer shall indemnify and defend Seller against and hold Seller harmless from any and all loss, cost, liability, or expense (including reasonable attorneys' fees) and repair any damage arising out of Buyer's (or Buyer's agents, employees, and contractors) activities on the Real Property during the Inspection Period; provided, that, such indemnity and repair obligation shall not cover or extend to (a) any claims of diminution in the value of the Property as a consequence of the results revealed by such tests and inspections, or (b) the exposure or release of hazardous substances or materials located in, on, or under the Property unless introduced to the area by Buyer, or Buyer's agents, employees, or contractors. Notwithstanding any other provision hereof this indemnity obligation shall survive the termination of this Agreement. In the event this Agreement is terminated, Buyer shall provide copies of all environmental, engineering, surveying, and other similar reports pertaining to the physical condition of the Real Property to Seller, at no expense but without representation or warranty of any kind (express of implied).
Section 3.2 Feasibility Period. The purpose of Feasibility Period is to permit Buyer to explore, in Buyer's sole and absolute discretion, whether it is feasible and desirable to construct the Project. Buyer shall have the absolute right to terminate this Agreement on or before the expiration of Feasibility Period for any reason or no reason, in which case the Deposit and all other payments made into escrow, together with all interest earned thereon, shall be returned and/or paid immediately to Buyer. This Agreement shall be deemed to have been automatically terminated unless Buyer sends Seller written notice that it elects to proceed beyond the Feasibility Period.
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Section 3.3 Approvals Period. The purpose of the Approvals Period is to enable Buyer to obtain all permits, licenses, authorizations, approvals, zoning, site plan approvals, building permits, legal changes, variances, use permits, discretionary land use approvals, public or private easements or rights-of-way, and other actions or inactions of any Governmental Units or third parties (including, but not limited to, any architectural review boards or the equivalent) necessary or desirable for the construction and operation of the Project ("Approvals"). If all such Approvals and financing for the Project are not obtained by the end of the Approvals Period, or if any periods for the filing of appeals from the granting thereof have not expired without an appeal having been taken therefrom (or if taken, such appeal not having been finally decided in favor of such grant), then this Agreement shall automatically terminate, in which case the Deposit and all other payments made into escrow, together with all interest earned thereon, shall be returned and/or paid immediately to Buyer.
Section 3.4 Exceptions to Title Commitment. Immediately after Escrow is opened, Seller shall order a current Title Commitment and all documents pertaining to all exceptions listed in the Title Commitment, and DB Buyer shall order an ALTA Survey. Buyer shall approve or disapprove the Title Commitment and the ALTA Survey within the Feasibility Period. In the event that Buyer objects to the exceptions set forth as exceptions to coverage in the Title Commitment or to matters shown on the ALTA Survey, Seller shall cure any liens or mortgages that may be discharged by the payment of money, together with all other matters placed on the Real Property after the Date of this Agreement with Buyer's consent, and may elect (in Buyer's discretion) to either cure or not cure any other exceptions or survey matters. If the exceptions or survey matters objected to by Buyer cannot be or are not eliminated by Seller within the earlier of (i) twenty (20) days after receipt of Buyer's objections or (ii) the Closing Date, and Buyer shall not waive its objections in writing within five (5) days thereafter, then, at Buyer's discretion, this Agreement shall be terminated and the Deposit and any other money deposited by Buyer into Escrow, together with all interest earned thereon, shall be returned to Buyer. Except for the exceptions expressly approved or waived by Buyer pursuant to this Section (the "Permitted Exceptions"), Seller shall deliver title free and clear of all liens and encumbrances. Any title exceptions or survey matter to which Buyer does not object within the Feasibility period shall be deemed to be expressly waived by Buyer.
Section 3.5 Seller's Approval of Buyer's Plans. Buyer agrees that all of Buyer's development plans, site layouts, and architectural elevations for the Project, including signage and landscaping plans, shall be subject to Seller's review and approval, such approval not to be unreasonably withheld. This provision shall survive the closing.
Section 3.6 Preservation of Trees. Buyer agrees that Buyer shall not remove or disturb any of the trees or other plantings or landscaping currently located on the Real Property in the crosshatched area shown on Exhibit B attached hereto. This provision shall survive the closing and, notwithstanding any provision contained herein, Seller may elect to include a restriction in the Deed that prohibits any owner of the Real Property from removing or disturbing such trees, plantings or landscaping. Further, Seller may elect to reserve a perpetual easement in the Deed for the care, maintenance and replacement of such trees, plantings and landscaping.
ARTICLE IV
Representations and Warranties; Covenants
Section 4.1 Seller's Representations and Warranties. Seller represents and warrants to Buyer as follows (both as of the Date of this Agreement and as of Closing):
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a) To the best of Seller's actual knowledge: (i) There are no adverse or other parties in possession of the Real Property or any part thereof, and (ii) other than as is of record no party has been granted any right of purchase, option, license, lease, or other right or interest relating to the use or possession of the Real Property, or any part thereof, and the Real Property is not subject to any contract or limitation of any kind.
b) To the best of Seller's actual knowledge there is no condition existing with respect to the Real Property, or any part thereof, which violates any federal, state, or local laws or regulations.
c) To the best of Seller's actual knowledge, and except as set forth in any Phase I report delivered by Seller to Buyer before the Date of this Agreement: The Real Property does not contain, no activity upon the Real Property has produced, and the Real Property has not been used in any manner for the storage of, any hazardous or toxic waste materials; and the Real Property does not contain underground storage tanks of any type.
d) Seller has the full right, power and authority to sell and convey the Property to Buyer as provided in this Agreement and to carry out Seller's obligations hereunder. Seller has, or will have as of the Closing, good and marketable title subject only to the Permitted Exceptions. All requisite corporate or other actions necessary to authorize Seller to enter into this Agreement and to perform its obligations hereunder have been taken; the joinder of no person or entity other than Seller will be necessary to convey the Real Property fully and completely to Buyer at Closing; and the execution and delivery of this Agreement and the Consummation of the transaction herein contemplated will not conflict with, or with notice or the passage of time, or both, result in a breach of any of terms or provisions of, or constitute a default under, any indenture, mortgage, agreement, or instrument to which Seller is a party or by which Seller or Seller's property, including without limitation the Property, is bound.
e) Seller is not a "foreign person" as defined in Internal Revenue Code Section 1445 and any related regulations. At the Closing, Buyer will have no duty to collect withholding taxes for Seller pursuant to the Foreign Investors Real Property Tax Act of 1980, as amended.
f) Seller is not in default in respect of any of its obligations or liabilities pertaining to the Property, nor is there any state of facts, circumstances, conditions or events which, after notice or lapse of time or both, would constitute or result in any such default.
g) To the best of Seller's actual knowledge: The Property has not, during any of the five (5) years prior to the date of this Agreement, been subjected to any special use valuation or exemption for purposes of assessment and/or ad valorem taxes.
Section 4.2 Seller's Covenants. Seller hereby covenants and agrees as follows:
a) Prior to the Closing Date, Seller shall not permit any new mortgage, lien, easement, restriction, or other encumbrance to be placed upon the Property, or increase the amount secured by the Property, except as previously agreed to by Buyer in writing or as may be (considering all other liens, mortgages, and pro-rations to be made or discharged at Closing) discharged completely out of the Purchase Price.
b) Prior to the Closing Date, Seller shall as its expense terminate any service contracts affecting the Property, unless otherwise requested in writing by Buyer.
c) Seller, without being required to incur any expenses to third parties, shall reasonably cooperate with Buyer
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in obtaining the consent, approval, and other action or inaction of all Governmental Units and any other persons or entities (including, but not limited to, any architectural review board of the equivalent thereof) desirable or necessary for the Project and to obtain any Approvals.
d) Seller shall obtain any lot split and legal description approval necessary under local law for the lawful and proper conveyance of the Property.
e) Seller shall notify Buyer immediately of the institution or maintenance of any condemnation or similar proceedings with respect to the Property. In the event any condemnation or similar proceedings are instituted or maintained with respect to a portion of the Property, either par...
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