EARNEST MONEY CONTRACT FOR DESIGN/BUILD PROJECT
(2.274 Acres, North Course Drive, Houston, Texas)
This Earnest Money Contract for Design/Build Project (" Contract" ) is entered into as of the Effective Date, as herein defined, between GSL CONSTRUCTORS, LTD. , as Seller (" Seller" ), and CYTOGENIX, INC. , a Nevada corporation (Employer ID: 76-0484097), as Buyer (" Buyer" ), and is on the following terms and conditions of agreement between Seller and Buyer:
1.
AGREEMENT TO BUY AND SELL: Seller agrees to sell and convey to Buyer, and Buyer agrees to buy and acquire from Seller, the Property described below, on the terms and conditions contained herein.
2.
PROPERTY: The property that is the subject of this Contract is approximately 2.274 acres of land out of Unrestricted Reserve " D" of Town Park at Rogerdale Subdivision as recorded in Film Code No. 576126 of the Real Property or Plat Records of Harris County, Texas, in the Fort Smith Survey , Abstract No. 1308 , Harris County, Texas, as more particularly described in the attached Exhibit " A" , Metes and Bounds Description (separately, the " Land" ), together with the Facility (as defined below) to be constructed or installed thereon pursuant to this Contract. All Land and the Facility sold by this Contract are collectively called the " Property ."
3.
SALES PRICE: The sales price that Buyer agrees to pay and Seller agrees to accept for the Property (the " Sales Price" ) is as follows:
A.
" Initial Down Payment" by Buyer...................85.
$ 474,571.50
B.
" Secondary Down Payment" by Buyer85858585858585
$ 474,571.50
C.
" Cash Balance" to be paid at Closing..................
$ 2,847,433.00
D.
Total Sales Price (Sum of A, B and C)..................85
$ 3,796,577.00
4.
EARNEST MONEY; CASH DOWN PAYMENT:
A.
INITIAL DEPOSITS:
(i)
Within two (2) business days after the Effective Date (as defined below), Buyer agrees to deposit with Chicago Title Company, 5858 Westheimer, Suite 300, Houston, Texas 77057, Attn: Mr. Tom Lykos/Phyllis Ocean, as escrow agent (" Escrow Agent" and " Title Company" ) both (1) the sum of $1,000.00 in cash (by wire transfer of immediately available funds) as " Earnest Money ," and (2) the sum of the Initial Down Payment specified above, in cash (by wire transfer of immediately available funds), as an initial down payment toward the Sales Price. The Initial Down Payment will be held by the Escrow Agent in an interest-bearing, money-market account, with interest thereon accruing for the benefit of Seller (as long as Seller promptly provides IRS form W-9 as required by federal tax law), pending release to Seller per paragraph (ii) hereof.
(ii)
Upon the Release Date (as herein defined, the Title Company shall pay over and disburse to Seller, and is hereby irrevocably authorized and directed by the parties to pay over and disburse to Seller, the Down Payment, without any prior written notice to or consent from either party hereto. For purposes hereof, " Release Date" means the later of (1) expiration of the termination rights of Buyer under Paragraph 12 hereof without the Title Company having received a copy of a notice sent by Buyer to Seller terminating this Contract pursuant to that Paragraph, or (2) issuance of the Commitment by the Title Company indicating that fee title to the Property appears to be vested in Seller (not as a guarantee or warranty, but only as a commitment to insure, but without any requirement on Schedule C thereof for a conveyance of the Property to Seller), free of matter s to which Buyer may object and has objected under Paragraph 5A (unless waived or deemed waived by Buyer), and otherwise complying with the requirements hereof (excluding liens to be released at Closing and changes that can only be made thereto at Closing upon payment of the applicable premium). If the Title Company receives no title objection notice from Buyer within five (5) business days after its issuance and delivery of the Commitment to Buyer as provided for under Paragraph 5A, or if the Title Company receives a copy of a No Cure Notice sent by Seller to Buyer under Paragraph 5A and does not receive notice of termination of this Contract from Buyer within five (5) business days thereafter, then the Title Company shall presume that the conditions of clause (2) in this Paragraph 4A.(ii) have been fully satisfied.
B.
SECONDARY DOWN PAYMENT:
Upon the latest to occur of (i) the Release Date, and (ii) three (3) business days after Buyer provides Title Company a copy of a notice given by Seller to Buyer that the Facility is completed to Dried-In Condition as herein
1
BUYER' S REPRESENTATIVE' S INITIALS: ________
SELLER' S REPRESENTATTIVE' S INITIALS: ________
JAPbr/>
(From 403592-1July 06 FORM)
EARNEST MONEY CONTRACT FOR DESIGN/BUILD PROJECT
(2.274 Acres, North Course Drive, Houston, Texas)
defined, Buyer shall deposit with the Title Company (by wire transfer of immediately available funds) the cash sum equal to the Secondary Down Payment specified above. The Title Company shall promptly upon receipt thereof from Buyer pay over and disburse the Secondary Down Payment to Seller, without any prior written notice to or consent from either party hereto. For purposes hereof, " Dried-In Condition" means the condition of completion at which Seller is able to commence construction on interior finish-out, and is conclusively established by Seller' s receipt of a certificate of Seller' s project architect for the Facility stating that the condition exists in which any part of interior finish improvements can be commenced by Seller.
C.
DOWN PAYMENT DEFINED; OTHER MATTERS PERTAINING TO DOWN PAYMENT
The Initial Down Payment and Secondary Down Payment, whenever the same are being held by Seller or the Title Company hereunder are herein collectively referred to as the " Down Payment ." The Earnest Money and the Down Payment are non-refundable to Buyer under all circumstances unless Buyer properly and timely terminates this Contract under the rights granted it in Paragraphs 5, 11, 12 or 25 (but in the case of termination under Paragraph 12C, subject to certain partial forfeiture to Seller as specified in Paragraph 12C).
5.
TITLE POLICY AND SURVEY:
A.
TITLE COMMITMENT AND POLICY:
At Closing, Seller shall pay (to the extent of the basic premium only) for the Title Company to furnish to Buyer an Owner Policy of Title Insurance (the " Title Policy" ) in the Texas standard commercial form (T-1) issued by the Title Company as agent for a reputable underwriter, in the amount of the Sales Price, dated as of the date of recording of the deed of the Property from Seller to Buyer, insuring Buyer against loss under the provisions of the Title Policy, subject to the promulgated exclusions (including existing building and zoning ordinances) and the following exceptions:
(i)
Easements, reservations, exceptions and restrictive covenants of record (if objection is not permitted as hereinbelow specified or if the same may be but are not objected to, or if such permitted objection is waived or deemed waived by Buyer in accordance with this Contract);
(ii)
The standard printed exception for standby fees, taxes and assessments for the year of Closing, and " roll-back" taxes (though Buyer will not be responsible for roll-back taxes as between Seller and Buyer);
(iii)
Liens created as part of any Buyer financing;
(iv)
Utility easements common to the subdivision in which the Property is located; and
(v)
The standard printed exception as to discrepancies, conflicts, shortages in area or boundary lines, encroachments, or protrusions, or overlapping improvements (the " Survey Exception" ).
Within ten (10) days after the Effective Date of this Contract, the Title Company shall furnish to both Buyer and Seller a Commitment for Seller' s Policy of Title Insurance (the " Commitment" ) and, at Seller's expense, furnish copies of restrictive covenants and documents evidencing exceptions in the Commitment (the " Title Documents" ), other than the standard pre-printed exceptions to both Buyer and Seller, contemporaneously. Seller authorizes the Title Company to mail or hand deliver the Commitment and related documents to Buyer at Buyer's address shown below and to Buyer' s counsel at its address shown below. If the Commitment is not delivered to Buyer within the specified time, the time for delivery shall be automatically extended up to ten (10) days. Buyer shall have ten (10) days after receipt of the Commitment, the Title Documents and the Sur vey (as defined below) in which to give written notice to Seller and the Title Company objecting to any matters shown thereon. If Buyer fails to timely make written objection to any such objectionable matters shown in the Commitment, Buyer will be deemed to have accepted the condition of title and all matters shown in the Commitment (other than deeds of trust, liens for unpaid taxes for any year other than the year of Closing, mechanic' s liens and judgment liens) will be " Permitted Exceptions" reflected as exceptions to Seller' s warranty of title in the Deed delivered to Buyer at Closing (as defined below), without adjustment of the Sales Price. Seller shall have until Closing within which to attempt to cure any timely and proper written objections by Buyer to the Commitment, but shall have no obligation to do so (other than deeds of trust (but if not executed or assumed by Seller [or knowingly taken by Seller subject to] then not to the extent in excess of Selle r' s title insurance coverage in regard thereto under its existing title insurance policy), liens for unpaid taxes for any year other than the year of Closing, mechanic' s liens and judgment liens), and if Seller notifies Buyer in writing of its inability or refusal to cure any such objectionable matters (a " No Cure Notice" ), then Buyer must terminate this Contract by written notice to Seller within five (5) business days after Buyer' s receipt of the No Cure Notice or Buyer will be deemed to have accepted such objected to item as an additional Permitted Exception to Seller' s title to the Property.
B.
SURVEY REQUIRED:
2
BUYER' S REPRESENTATIVE' S INITIALS: ________
SELLER' S REPRESENTATTIVE' S INITIALS: ________
JAPbr/>
(From 403592-1July 06 FORM)
EARNEST MONEY CONTRACT FOR DESIGN/BUILD PROJECT
(2.274 Acres, North Course Drive, Houston, Texas)
At Seller' s expense, Seller shall cause a survey of the Land to be made by a registered Texas Professional Land Surveyor acceptable to the Title Company for purposes of modifying the Survey Exception (should Buyer at its expense elect to purchase the standard promulgated deletion for survey coverage, i.e., excluding coverage only for " shortages in area" ) and deliver the same to Buyer within fifteen (15) days after the Effective Date hereof, or provide Buyer a copy of an existing previously prepared survey of the Land that is no more than twenty-four months old (the " Survey" ). If the Survey is not delivered to Buyer within the specified time, the time for delivery shall be automatically extended up to ten (10) days. Buyer shall have ten (10) days after receipt of the Survey, the Title Commitment and the Title Documents in which to give written notice to Seller objecting to any condition shown thereon that constitutes a material defect in good and indefeasible title to the Property, or the existence of which would materially and adversely impair Buyer' s intended use of the Property. If Buyer fails to timely make written objection to any matters shown on the Survey, then Buyer will be deemed to have accepted the condition of Property as reflected on the Survey (and to have accepted the Survey itself) and any matters therefrom that are excepted to in the Title Policy will be additional Permitted Exceptions reflected as exceptions to Seller' s warranty of title in the Deed delivered to Buyer at Closing, without adjustment of the Sales Price. Seller shall have until Closing to cure any timely and proper written objections by Buyer to the Survey, but shall have no obligation to do so (other than deeds of trust (subject to the same limitations as in (A), above), liens for unpaid taxes for any year other than the year of Closing, mechanic' s liens and judgment liens), and if Seller notifies Buyer in writing of its inability or refusal to cure any such objectionable Survey matters (likewise, a " No Cure Notice" ) then Buyer must terminate this Contract by written notice to Seller within five (5) business days after Buyer' s receipt of the No Cure Notice or Buyer will be deemed to have accepted such objected to item as an additional Permitted Exception to Seller' s title to and the physical condition of the Property and as an additional exception to the Title Policy. Additionally, prior to pouring the foundation slab, Seller shall cause the foundation forms to be surveyed and shall provide Buyer a copy of the foundation form survey prior to pouring the foundation. At Closing, Seller shall provide Buyer with an " As Built" survey, showing the location of all improvements constructed on the Property, and such As Built survey shall show no encroachments of such buildings over or into property lines , building lines or easements.
C.
RETURN OF DEPOSITS IN CASE OF PERMITTED BUYER TERMINATION: In the event Buyer is entitled to and timely does terminate this Contract pursuant to Paragraphs 5A or 5B, above, or Paragraphs 12or 25 below, it is agreed that the Earnest Money and the Down Payment then held by Title Company and/or Seller will be returned in their entirety to Buyer, subject to the provisions of Paragraph 12C for deduction of the Cancellation Fee and Plan Costs (as hereinbelow described) in the circumstances therein described.
6.
PROPERTY CONDITION:
A.
CONSTRUCTION DOCUMENTS:
Seller agrees to sell the Property to Buyer with the following improvements and fixtures (collectively, herein called the " Facility" ) in at least Substantially Completed condition (as hereinafter defined): those described in the general outline specifications, finish-out schedules or allowances incorporated in and identified as Exhibit B-1 , Building Description, and Exhibit B-2 , Site Plan, each of which is attached hereto and incorporated herein by reference (collectively, such Site Plan and Building Description being herein called the " Outline Specifications" ), comprising an approximately 20,000 SF single story office building and related improvements. After Seller is required to commence construction of the Facility pursuant to this Contract, the construction of Facility shall be prosecuted and completed with reasonable continu ity and due diligence, and in accordance Exhibit C attached hereto and incorporated herein by reference and the provisions of this Contract. For purposes of this Contract, the phrase " Final Construction Documents" has the meaning assigned to it in Exhibit C .
B.
COST ADJUSTMENTS:
Changes in the Outline Specifications or Final Construction Documents shall be handled in accordance with Exhibit C hereto regarding Change Orders. Buyer shall not be responsible for payment of any Change Work not approved in advance by Buyer, but Buyer may be obligated to pay Change Order costs resulting from unanticipated site conditions as provided in Exhibit C . The Sales Price shall be reduced by the amount of any net decrease in costs of construction resulting from Change Orders and unused allowances (however, total cost of construction and land cost does not determine the Sales Price).
C.
BUYER'S SELECTIONS:
If the Outline Specifications or Final Construction Documents permit selections by Buyer, Buyer's selections will conform to Seller's normal standards or will not, in Seller's judgment, materially and adversely affect the marketability of the Property. Buyer will make required selections within ten (10) days after receipt of written notice from Seller requesting Buyer to make such selections.
3
BUYER' S REPRESENTATIVE' S INITIALS: ________
SELLER' S REPRESENTATTIVE' S INITIALS: ________
JAPbr/>
(From 403592-1July 06 FORM)
EARNEST MONEY CONTRACT FOR DESIGN/BUILD PROJECT
(2.274 Acres, North Course Drive, Houston, Texas)
D.
COMPLETION:
Construction by Seller will commence and proceed within ten (10) days after construction permit issuance, but in no event shall Seller be required to commence such construction prior to expiration of Buyer' s cancellation options under Paragraph 5 (if applicable) and Paragraph 12 and receipt of the released Down Payment from the Title Company. Seller estimates that the Facility will be Substantially Complete (as herein defined) within two hundred fifteen (215) days after the later of the date on which Buyer approves or is deemed to have approved the Final Construction Documents or Seller' s obtaining of necessary permits, plus an amount of time equal to Buyer Delay and force majeure delay (the " Estimated Completion Date" ). " Substantially Completed" (sometimes herein referred to as " Substantial Completion" ) means the Facility is constructed in substantial compliance with the Final Construction Documents and all applicable laws and regulations applicable thereto, to a point at which any parts that are incomplete or require corrective work do not materially interfere with the occupancy and use of the Facility for its designed purpose; provided, however, that for purposes of this Contract and the Closing hereunder, the Facility shall be conclusively deemed to be Substantially Completed upon (i) the final inspection and approval by all applicable governmental authorities, or issuance of a permanent or conditional certificate of occupancy by the applicable governmental authority (if one is issued in the jurisdiction), and (ii) issuance of a certificate of substantial completion by Seller' s project architect or engineer. The occurrence of Substantial Completion will not release Seller from its obligation to complete Punch List Items that are included on the Joint Punch List (as such terms defined in Paragraph 6E , below) or from its obligation under Seller' s Warranty expressly provided for in this Contract, but merely determines the date of Closing. Seller may, without prior consultation with Buyer, substitute materials, equipment and appliances of equal or better quality, function and (in the case of finishes only) appearance for those specified in the Final Construction Documents provided that if the proposed substitution involves items of a cost exceeding $10,000, then Seller must obtain Buyer' s prior written consent to the substitution, and raise the site elevation with fill materials to create improved drainage as it may see fit. Seller shall be responsible for obtaining all permits and approvals of governmental authorities required in connection with the construction of the Facility, including, without limitation (unless dependent on installation of personal property items or facilities that are not part of the Facility being constructed by Seller hereunder), any certificate of occupancy required by any governmental authority. Buyer may make reasonable inspection of the work on the Facility as it progresses, subject to reasonable prior arrangement with Seller and its contractor(s), non-interference with the Seller' s construction by Buyer' s inspecting representative, and Buyer' s compliance with all contractor-established safety rules and regulations for inspection visits.
E.
PUNCH LIST AND COMPLETION OF PUNCH LIST ITEMS:
For purposes of this Contract, " Punch List Items" are all aspects of the Facility that remain to be completed or corrected following Substantial Completion, excluding latent defects as herein defined. Within five (5) days after Buyer' s receipt from Seller of written notice of Substantial Completion, Buyer shall arrange with Seller for a joint walk-through of the Facility (the " Joint Punch List Walk-through" ), at which time they shall create a list that is mutually acceptable to them of all Punch List Items relating to the Facility (the " Joint Punch List" ). Upon receipt of such notice from Seller, Buyer will give Seller at least two (2) business days' advance written notice of two proposed business days (within such 10-day period) for the Joint Punch List Walk-through, and Seller will notify Buyer within one (1) business day of receipt of such notice of the time on one such day (during normal business hours) that Seller accepts for purposes of conducting the Joint Punch List Walk-through inspection. If Seller fails to notify Buyer of the time, or fails to provide a representative to accompany Buyer at the designated time for the Joint Punch List Walk-through, then Buyer shall prepare the Joint Punch List on one of the days specified in Buyer' s notice and deliver the Joint Punch List so prepared to Seller within one (1) business day thereafter. Seller agrees to use reasonable diligence to complete the Punch List Items identified on the Joint Punch List within thirty (30) days of the date of the Joint Punch List Walk-through (or timely receipt of Buyer' s unilaterally prepared Joint Punch List if Seller or its representative failed to accompany Buyer at the designated time - but in that case only to the extent of Punch List Items correctly identified). Any Punch List Items that are not latent def ects (as defined below) and that are not identified on such Joint Punch List as a result of the Joint Punch List Walk-through (or on Buyer' s unilaterally prepared Joint Punch List if Seller or its representative failed to accompany Buyer at the designated time) are deemed accepted, approved and waived by Buyer. Seller' s pending completion of Punch List Items shall not, under any circumstance, delay Closing. In addition, Punch List Items that are not of a purely cosmetic, readily visible nature from an inspection by a non-expert, including adjustments to mechanical systems and equipment and the like (even if not qualifying as latent defects), but only to the extent the same are not the result of Buyer damage, abuse or misuse, will be promptly corrected or adjusted by Seller upon written notice given by Buyer to Seller identifying such previously omitted Punch List Item with reasonable particularity within thirty (30) days after the Closing Date, but will not be the subject of the Complet ion Escrow. At Closing, the parties shall agree on the reasonable cost to complete all Joint Punch List items (the " Estimated Completion Cost" ) and a portion of the Sales Price equal to 120% of such Estimated Completion Cost (the " Completion Escrow" ) shall be escrowed by Seller with the Title Company under the terms of an escrow agreement entered into by Seller, Buyer and the Title Company, the form of which shall be acceptable to the Title Company and reasonably acceptable to Seller and
4
BUYER' S REPRESENTATIVE' S INITIALS: ________
SELLER' S REPRESENTATTIVE' S INITIALS: ________
JAPbr/>
(From 403592-1July 06 FORM)
EARNEST MONEY CONTRACT FOR DESIGN/BUILD PROJECT
(2.274 Acres, North Course Drive, Houston, Texas)
Buyer (the " Completion Escrow Agreement" ). If the parties cannot agree on the Estimated Completion Cost, then an estimate provided to Seller by a third-party contractor unaffiliated with Seller, other than the contractor hired to construct the Facility, shall be binding on the parties absent subterfuge or collusion that benefits the party providing the estimate. The terms of the Completion Escrow Agreement shall include that (i) subject to clause (ii), below, Seller is entitled to withdraw funds from the Completion Escrow by delivery of a written certification by Seller' s project architect that the portion of the Joint Punch List work evidenced thereby is completed and requesting disbursement to Seller of the 120% of the Estimated Completion Cost assigned to such completed items in the Completion Escrow Agreement, (ii) unless Buyer makes written objection to such certification within seven (7) business days from the effective date of notice from the Title Company to Buyer that such request for disbursement has been made by Seller and forwarding to Buyer of Seller' s request and architect' s certification, the Title Company shall be fully protected in making and shall make the disbursement requested by Seller without any requirement for active or affirmative consent or approval of Buyer, and (iii) if Seller shall fail to complete all such Joint Punch List items in a reasonable time, not less than sixty (60) days and not more than ninety (90) days (unless Buyer unreasonably interferes therewith) from Closing, such remaining Completion Escrow funds (after disbursement of amounts related to those items that were completed by Seller) held by the Title Company shall be made available to Buyer to defray the costs incurred by Buyer in completing such Joint Punch List items on Seller' s behalf. Buyer agrees (and will agree in the Completion Escrow Agreement (A) not to object to disbursements to Seller without good cause, and (B) if it is determined that Buyer has objected without good cause and has maintained such wrongful position for in excess of 30 days, Buyer shall owe Seller interest at the lesser of (1) the rate of eighteen (18%) per annum, or (2) the maximum lawful rate Seller may contract to charge Buyer hereunder, on the amount of funding wrongfully withheld in addition to the disbursement for such costs.
Seller agrees that Buyer shall have the right to designate a representative or representatives, such as a consulting architect and/or engineer, to assist Buyer in connection with this Agreement and Buyer' s inspections hereunder, including the Joint Punch List Walk-through. Seller agrees to cooperate reasonably with any such representative designated by Buyer so long as such representative does not cause disruption or delay in the progress of Seller' s construction.
F.
SELLER' S LIMITED WARRANTY:
In connection with the Facility constructed by Seller hereunder, Seller warrants that such improvements and fixtures shall be of good workmanship and material, all of which shall be subject to Seller' s Warranty as hereinbelow described. At Closing all assignable equipment and appliance warranties on Manufacturer Equipment (defined below) shall be assigned by Seller to Buyer. Additionally, once Seller' s warranty provided for herein has expired, Seller shall assign all written and implied warranties from subcontractors and material suppliers to Buyer, without recourse on or representation by Seller of any kind. Except as otherwise provided for herein, as its sole and exclusive obligation to Buyer after Closing, Seller agrees for a period of twelve (12) months [and twenty-four (24) months with respect to the roof, foundation, struc tural support elements, and Covered Leaks (as defined below)] following Substantial Completion (the " Warranty Period" ) to repair and correct any latent defects in construction of the Facility, excepting only equipment that is incorporated into the work and that is (as of the date of installation) covered by any type of warranty from the equipment manufacturer (" Manufacturer Equipment" ). The repair obligation of Seller under the preceding sentence is herein called the " Seller' s Warranty" ). Except as otherwise provided herein, Seller agrees following receipt of written notice from Buyer identifying the specific defects with reasonable particularity to make or have made all repairs and correct all defects, within a commercially reasonable time of receipt of such notice of defect. Without limiting any of the foregoing, upon receipt of such notice of defect from Buyer, Seller' s Warranty shall require that Seller ma ke necessary repairs during the applicable Warranty Period so as to cause the Facility to be watertight and leakproof in all material respects at every point and in every area, this provision being intended to refer to watertightness and leakproof from the elements in regard to the roof and enclosing walls, not as to pipe leakage, condensation from humidity, or floodwater), except where leaks can be attributed to damage by external forces beyond Seller's control such as (i) extreme weather that is sufficient to cause a casualty, and (ii) negligence or abuse by Buyer, its employees, agents, contractors, servants, invitees or licensees, including any entry onto the roof by Buyer or its personnel or contractors (such ...
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