EXHIBIT 10.1
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LOAN SALE AGREEMENT
Dated and Effective as of February 10 2004
by and between
American Insured Mortgage Investors - Series 85, L.P.
SELLER
and
Greystone Servicing Corporation, Inc.
BUYER
TABLE OF CONTENTS
Page
ARTICLE 1- DEFINITIONS.................................................................................1
Section 1.1 Agreement.........................................................................1
Section 1.2 Assigned Rights and Obligations...................................................2
Section 1.3 Assignment and Assumption of Assigned Rights and Obligations......................2
Section 1.4 Business Day......................................................................2
Section 1.5 Closing...........................................................................2
Section 1.6 Closing Date......................................................................2
Section 1.7 Cobblestone Loan .................................................................2
Section 1.8 Closing Documents.................................................................2
Section 1.9 Collateral........................................................................2
Section 1.10 Collateral Document...............................................................2
Section 1.11 Intentionally Deleted.............................................................2
Section 1.12 Escrow............................................................................2
Section 1.13 Escrow Holder.....................................................................2
Section 1.14 Intentionally Deleted.............................................................3
Section 1.15 Loans.............................................................................3
Section 1.16 Loan Documents....................................................................3
Section 1.17 Loan Note.........................................................................3
Section 1.18 Obligor...........................................................................3
Section 1.19 Plantation Loan .....................................................................3
Section 1.20 Purchase Price....................................................................3
ARTICLE 2- PURCHASE AND SALE OF THE ASSIGNED RIGHTS...............................................3
Section 2.1 Agreement to Sell and Purchase Assigned Rights and Obligations...................3
Section 2.2 Assignment and Assumption of Assigned Rights and Obligations.....................3
Section 2.3 Consideration for Assigned Rights and Obligations................................3
Section 2.4 Deposit..........................................................................4
Section 2.5 Buyer Designee...................................................................4
Section 2.6 Escrow...........................................................................4
Section 2.7 Indemnity of Escrow Holder.......................................................4
ARTICLE 3- REPRESENTATIONS, WARRANTIES AND COVENANTS OF BUYER .........................................4
Section 3.1 Authorization and Compliance.....................................................4
Section 3.2 Binding Obligation of Buyer......................................................5
Section 3.3 No Conflict With Other Agreements................................................5
Section 3.4 No Further Consent Required......................................................5
Section 3.5 Independent Evaluation...........................................................5
Section 3.6 Direction to Conduct Due Diligence...............................................5
Section 3.7 No Reliance on Seller............................................................5
Section 3.8 Application to Designee..........................................................6
ARTICLE 4- REPRESENTATIONS AND WARRANTIES OF SELLER....................................................6
Section 4.1 Seller Is Holder of Loan and Assigned Rights and Obligations.....................6
Section 4.2 Compliance with FHA Regulations..................................................6
Section 4.3 Advances.........................................................................6
Section 4.4 Disclaimer.......................................................................6
ARTICLE 5- CONDITIONS PRECEDENT........................................................................7
Section 5.1 Conditions for the Benefit of Buyer, Including Due Diligence.....................7
Section 5.2 Conditions for the Benefit of Seller.............................................7
Section 5.3 Failure or Waiver of Conditions Precedent........................................7
ARTICLE 6- CLOSING.....................................................................................8
Section 6.1 Escrow...........................................................................8
Section 6.2 Deliveries by Buyer..............................................................8
Section 6.3 Deliveries by Seller.............................................................8
Section 6.4 Delivery of Loan Files and Funds.................................................9
Section 6.5 Closing Costs....................................................................9
Section 6.6 Prorations......................................................................10
Section 6.7 Insured Collateral..............................................................10
Section 6.8 Title Insurance.................................................................10
ARTICLE 7- FILES AND RECORDS..........................................................................10
Section 7.1 Conformity to Law...............................................................10
Section 7.2 Inspection by Seller............................................................10
ARTICLE 8- RELEASE AND INDEMNIFICATION OF SELLER......................................................10
Section 8.1 Seller's Indemnification........................................................10
Section 8.2 Buyer's Indemnification.........................................................10
Section 8.3 Collateral Materials............................................................11
ARTICLE 9- BREACH OF THE AGREEMENT....................................................................11
Section 9.1 Seller's Breach.................................................................11
Section 9.2 Buyer's Breach..................................................................12
Section 9.3 Liquidated Damages..............................................................12
Section 9.4 No Personal Liability...........................................................12
Section 9.5 Intentionally Deleted...........................................................12
Section 9.6 Damages Related To Collateral...................................................12
ARTICLE 10- NOTICES...................................................................................12
ARTICLE 11- MISCELLANEOUS PROVISIONS..................................................................13
Section 11.1 Waiver of Jury Trial............................................................13
Section 11.2 Severability....................................................................14
Section 11.3 Rights Cumulative: Waivers......................................................14
Section 11.4 Headings........................................................................14
Section 11.5 Construction....................................................................14
Section 11.6 Assignment......................................................................14
Section 11.7 Prior Understandings............................................................14
Section 11.8 Integrated Agreement............................................................14
Section 11.9 Counterparts....................................................................14
Section 11.10 Survival........................................................................15
Section 11.11 Governing Law...................................................................15
Section 11.12 Expenses........................................................................15
Section 11.13 Brokers.........................................................................15
Section 11.14 Effectiveness Of The Agreement..................................................15
Section 11.15 Attorneys' Fees.................................................................15
Section 11.16 Further Assurances..............................................................15
Section 11.17 Publicity.......................................................................15
Section 11.18 Confidentiality.................................................................15
Section 11.19 Time of Essence.................................................................16
ARTICLE 12- ..........................................................................................16
Section 12.1 Non-Solicitation of Obligors....................................................16
LOAN SALE AGREEMENT
THIS LOAN SALE AGREEMENT ("Agreement"), is made and entered into as of February
10, 2004, by and between AMERICAN INSURED MORTGAGE INVESTORS - SERIES 85, L.P.,
a California limited partnership ("Seller") and GREYSTONE SERVICING CORPORATION,
INC., a Georgia corporation ("Buyer").
RECITALS
A. Seller is the holder of and wishes to sell certain Loans (as identified
on Schedule 1 hereto) on the terms and subject to the conditions set forth
herein.
B. Buyer wishes to purchase the Loans, all on the terms and subject to the
conditions set forth herein.
C. The Loans are fully insured by the United States Department of Housing
and Urban Development ("HUD") acting through an authorized agent (the "FHA")
under various sections of the National Housing Act, as amended and the
regulations promulgated thereunder (the "Regulations").
D. Pursuant to that certain Loan Servicing Agreement dated July 1, 1995
("Loan Servicing Agreement"), Seller entered into an agreement with CRIIMI MAE
Services Limited Partnership ("CMSLP") whereby CMSLP agreed to service the
Loans, among others.
E. Seller and CMSLP have agreed to terminate their servicing agreement in
regard to the Loans, subject only to CMSLP's obligation to indemnify Seller, its
successors and assigns, against any failure of CMSLP to service said Loans in
accordance with FHA requirements so as not to adversely affect the FHA insurance
on the Loans, and Seller wishes, as part of the transaction contemplated herein
to convey all of its right, title interest and obligations in and to the Loans
on a "servicing released" basis, and to assign its rights and obligations in
CMSLP's indemnification to Buyer.
AGREEMENT
NOW, THEREFORE, in consideration of the Premises, which are incorporated
herein by reference, and the mutual promises herein set forth and other valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
Seller and Buyer agree as follows:
ARTICLE 1
DEFINITIONS
For purposes of this Agreement, the following terms shall have the meanings
indicated:
Section 1.1 "Agreement" means this Loan Sale Agreement, including all
Exhibits and Schedules hereto.
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Section 1.2 "Assigned Rights and Obligations" means all of Seller's right,
title, interest and obligations, if any, in and to the Loans as of the Closing
Date on a "servicing released" basis, and its rights to CMSLP's indemnification
for any servicing defaults prior to Closing hereunder.
Section 1.3 "Assignment and Assumption of Assigned Rights and Obligations"
means the documents to be delivered on the Closing Date by Buyer and Seller, the
forms of which are attached hereto as Exhibit B, whereby Seller assigns to Buyer
or Buyer's designee, and Buyer or Buyer's designee accepts from Seller, the
Assigned Rights and Obligations.
Section 1.4 "Business Day" means any day on which Seller is open for
business other than a Saturday, a Sunday or a Maryland state or Federal holiday.
Section 1.5 "Closing" means the occurrence of all acts required by this
Agreement to assign and transfer the Assigned Rights and Obligations from Seller
to Buyer and for Buyer to accept the Assigned Rights and Obligations from
Seller.
Section 1.6 "Closing Date" means February 10, 2004 or such other date upon
which Buyer and Seller may mutually agree.
Section 1.7 "Cobblestone Loan" means (a) the obligation evidenced by the
Loan Note in the original principal amount of $5,306,000.00, the Loan Documents
and/or any amendment thereto and (b) all rights, powers, liens or security
interests of Seller in or under any Collateral Document.
Section 1.8 "Closing Documents" means all documents described herein that
are required to be delivered at the Closing by Seller or Buyer.
Section 1.9 "Collateral" means the real and personal property, guaranty,
pledge and/or other property securing the Loan Note as described in the Loan
Documents.
Section 1.10 "Collateral Document" means the deed of trust, mortgage
security agreement, UCC financing statements, guaranty, letter of credit,
pledge, loan agreement and/or other instruments creating a security interest in,
and/or a lien or encumbrance upon any of the Collateral, including without
limitation any of the Loan Documents.
Section 1.11 INTENTIONALLY DELETED.
Section 1.12 "Escrow" means the escrow to be opened with the Escrow Holder
in connection with this Agreement and the transaction contemplated hereunder.
Section 1.13 "Escrow Holder" means First American Title Insurance Company,
whose address for this transaction is as follows:
1801 K Street, NW, Suite 200 K-1
Washington, D.C. 20006
Attn: Brian A. Lobuts, Vice President
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Section 1.14 INTENTIONALLY DELETED.
Section 1.15 "Loans" means the Cobblestone Loan and the Plantation Loan
collectively, or individually a "Loan", each as more particularly identified on
Schedule 1 hereto.
Section 1.16 "Loan Documents" means the agreements, instruments, affidavits
or other documents related to, or evidencing, the Loan, as obtained at the time
of its origination and any subsequent modification, which are set forth and
listed in Exhibit A.
Section 1.17 "Loan Note" means the Deed of Trust Note evidencing the
indebtedness of the Cobblestone Loan and the Deed of Trust Note evidencing the
indebtedness of the Plantation Loan both as described on Exhibit A hereto
collectively.
Section 1.18 "Obligor" means the borrower under a Loan Note.
Section 1.19 "Plantation Loan" means (a) the obligation evidenced by the
Loan Note in the original principal amount of $4,715,300.00, the Loan Documents
and/or any amendment thereto and (b) all rights, powers, liens or security
interests of Seller in or under any Collateral Document.
Section 1.20 "Purchase Price" means the 107.00% of the then outstanding
principal balance of the Loans on the Closing Date as shown on Schedule 1,
attached hereto and made a part hereof, plus accrued and unpaid interest
thereon.
ARTICLE 2
PURCHASE AND SALE OF THE ASSIGNED RIGHTS AND OBLIGATIONS
Section 2.1 Agreement to Sell and Purchase Assigned Rights and Obligations.
On the Closing Date, Seller agrees to sell, transfer and assign, and Buyer
agrees to purchase and assume, the Assigned Rights and Obligations, without
representations, express or implied except as specifically set forth herein,
without warranties, express or implied, except as specifically set forth herein
and without recourse to Seller.
Section 2.2 Assignment and Assumption of Assigned Rights and Obligations.
On the Closing Date, Seller and Buyer shall each deliver to the other an
Assignment and Assumption of Assigned Rights and Obligations, in the form of
Exhibit B hereto, executed by an authorized representative of Seller and Buyer,
which Assignment and Assumption of Assigned Rights and Obligations shall sell,
transfer, assign, set-over, convey and delegate to Buyer the Assigned Rights and
Obligations.
Section 2.3 Consideration for Assigned Rights and Obligations. As
consideration for the transfers and assignments hereunder by Seller, Buyer shall
pay the Purchase Price to Seller on the Closing Date, and Buyer shall assume all
of Seller's obligations under the Assigned Rights and Obligations. On the
Closing Date, Buyer shall pay to Seller, by wire transfer of immediately
available funds, the Purchase Price together with any additional amounts payable
by Buyer pursuant to the closing adjustments and prorations described in
Sections 6.5 and 6.6 hereof.
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Section 2.4 Deposit. INTENTIONALLY DELETED.
Section 2.5 Buyer Designee. Upon the written consent of Seller delivered to
Buyer at least five (5) business days prior to the Closing, Buyer may designate
to Seller in writing, at its sole discretion, an affiliated entity as designee
to receive and assume the Assigned Rights and Obligations. If Buyer designates
another entity to assume the Assigned Rights and Obligations, Buyer nevertheless
shall remain liable for all obligations of Buyer hereunder and thereunder,
notwithstanding any such designation.
Section 2.6 Escrow. Upon the execution of this Agreement by Buyer and
Seller, and the acceptance of this Agreement by the Escrow Holder in writing,
this Agreement shall constitute the joint escrow instructions of Buyer and
Seller to Escrow Holder to open Escrow for the consummation of the transfer of
the Assigned Rights and Obligations to Buyer pursuant to this Agreement. Upon
Escrow Holder's receipt of the Deposit and Escrow Holder's written acceptance of
this Agreement, Escrow Holder is authorized to act in accordance with the terms
of this Agreement. Buyer and Seller shall promptly execute general escrow
instructions based upon this Agreement at the request of Escrow Holder;
provided, however, that if there is any conflict or inconsistency between such
general escrow instructions and this Agreement, this Agreement shall control.
Upon the Closing, Escrow Holder shall pay any sum owed to Seller with
immediately available United States federal funds. In the event of a dispute
between any of the parties hereto which cannot be resolved prior to 2:00 pm EST
on the Closing Date, Escrow Holder shall immediately return all funds via wire
transfer and documents via overnight delivery to the respective party depositing
same with Escrow Agent and shall thereupon be discharged. Seller and Buyer
covenant and agree that in performing any of its duties under this Agreement,
Escrow Holder shall not be liable for any loss, costs or damage which it may
incur as a result of serving as Escrow Holder hereunder, except for any loss,
costs or damage arising out of its willful default or gross negligence.
Section 2.7 Indemnity of Escrow Holder. Seller and Buyer hereby agree to
indemnify and hold harmless Escrow Agent against any and all losses, claims,
damages, liabilities and expenses, including without limitation, reasonable
costs of investigation and attorneys' fees and disbursements which may be
imposed upon or incurred by Escrow Agent in connection with its serving as
Escrow Agent hereunder, except for any loss, costs or damage arising out of its
willful default or gross negligence.
ARTICLE 3
REPRESENTATIONS, WARRANTIES AND COVENANTS OF BUYER
Buyer hereby represents, warrants and covenants as of the date hereof and
as of the Closing Date that:
Section 3.1 Authorization and Compliance. Buyer is an FHA-approved
mortgagee, is duly and legally authorized to enter into this Agreement and has
complied with all laws, rules, regulations, charter provisions and bylaws to
which it may be subject and that the undersigned representative is authorized to
act on behalf of and bind Buyer to the terms of this Agreement. Upon the
execution hereof, Buyer will supply Seller with a certified copy of a resolution
of its Board of Directors, Partners, or Members as the case may be,
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authorizing Buyer's entry into this Agreement through such representative,
together with such documents as Seller may reasonably require as evidence of the
Buyer's good standing or as further evidence of such authority.
Section 3.2 Binding Obligation of Buyer. Assuming due authorization,
execution and delivery by each other party hereto, this Agreement and all of the
obligations of Buyer hereunder are the legal, valid and binding obligations of
Buyer, enforceable in accordance with the terms of this Agreement, except as
such enforcement may be limited by bankruptcy, insolvency, reorganization or
other similar laws affecting the enforcement of creditors' rights generally and
by general equity principles (regardless of whether such enforcement is
considered in a proceeding in equity or at law).
Section 3.3 No Conflict With Other Agreements. The execution and delivery
of this Agreement and the performance of its obligations hereunder by Buyer will
not conflict with any provision of any law or regulation to which Buyer is
subject or conflict with or result in a breach of or constitute a default of any
of the terms, conditions or provisions of any agreement or instrument to which
Buyer is a party or by which it is bound or any order or decree applicable to
Buyer.
Section 3.4 No Further Consent Required. Buyer is not required to obtain
the consent of any other party or any consent, license, approval or
authorization from, or registration or declaration with, any governmental
authority, bureau or agency in connection with Buyer's execution, delivery, or
performance of this Agreement, except such as have been obtained.
Section 3.5 Independent Evaluation. Buyer's decision to purchase the Loans
and assume the Assigned Rights and Obligations pursuant to this Agreement is and
was based upon Buyer's own independent evaluation of any information made
available by Seller, and Buyer's independent evaluation of the Loan Documents
and Collateral Documents, and Buyer has been given the opportunity to inspect
and review the Loan Documents, Collateral Documents, Collateral and other
related information as it deems necessary, proper or appropriate. Buyer has
relied solely on its own investigation and it has not relied upon any oral or
written information provided by Seller or its personnel or agents and
acknowledges that no employee or representative of Seller has been authorized to
make, and that Buyer has not relied upon, any statements other than those
specifically contained in this Agreement.
Section 3.6 Direction to Conduct Due Diligence. Buyer has been urged,
invited and directed to conduct such due diligence review and analysis of the
Collateral, Loan Documents, Collateral Documents and related information,
together with such records as are generally available to the public from local,
county, state and federal authorities, record-keeping offices and courts
(including, without limitation, any bankruptcy courts in which Obligor, its
guarantor or surety, if any, may be subject to any pending bankruptcy
proceedings), as Buyer deemed necessary, proper or appropriate in order to make
a complete, informed decision with respect to the purchase and acquisition of
the Assigned Rights and Obligations.
Section 3.7 No Reliance on Seller. Buyer is not relying upon the continued
actions or efforts of Seller in connection with its decision to purchase the
Loan and to purchase and assume the Assigned Rights and Obligations, and Buyer
agrees that the representations
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made herein and other valid reasons and the purchase of the Loan, the
Assigned Rights and Obligations does not constitute the purchase of securities
within the meaning of federal or state securities laws.
Section 3.8 Application to Designee. If Buyer designates an affiliate to
receive and assume the Assigned Rights and Obligations pursuant to Section 2.5,
all of the representations, warranties and covenants of Buyer contained in this
Article 3 shall be deemed remade and to apply to Buyer's designee as if the name
of Buyer's designee were substituted in place of Buyer in each instance other
than the preamble to Article 3.
ARTICLE 4
REPRESENTATIONS AND WARRANTIES OF SELLER
Section 4.1 Seller Is Holder of Loan and Assigned Rights and Obligations.
Seller hereby represents and warrants that at all times relevant Seller has
been, and as of the date hereof and as of the Closing Date, that the Seller is
an FHA-approved mortgagee and is the holder of the mortgagee's and servicer's
interest in the Loan and that the Seller has the authority and right to sell and
assign the Assigned Rights and Obligations to Buyer.
Section 4.2 Compliance with FHA Regulations. Seller hereby represents and
warrants that at all times relevant and as of the date hereof and as of the
Closing Date, has caused CMSLP in its capacity as servicer of the Loans to
comply with the requirements of the National Housing Act and the Regulations and
to perform its duties and acts in accordance with the normal and usual standards
of practice of prudent servicers of FHA-insured project mortgage loans and in
compliance with the Loan Servicing Agreement and that the Loans have been
finally endorsed by FHA for mortgage insurance which is in full force and
effect, and which may be claimed without surcharge. Further, Seller hereby
represents and warrants that CMSLP has fully indemnified Seller against any
servicing defects or default by CMSLP that could adversely affect the FHA
insurance on the Loans and which indemnification is fully assignable to Buyer.
Section 4.3 Advances. Seller hereby represents and warrants that no advance
or advances have been made by the mortgagee to the mortgagor with respect to
each of the Mortgage Loans, except as set forth on Exhibit A.
Section 4.4 Disclaimer. EXCEPT FOR THOSE EXPRESSED IN SECTION 4.1 AND 4.2,
NO WARRANTIES OR REPRESENTATIONS, EXPRESS OR IMPLIED, HAVE BEEN MADE BY SELLER
OR BY ANYONE ACTING ON ITS BEHALF, PARTICULARLY, BUT WITHOUT IN ANY WAY LIMITING
THE GENERALITY OF THE FOREGOING, NO WARRANTIES OR REPRESENTATIONS REGARDING (i)
THE COLLECTABILITY OF THE LOAN, (ii) THE CREDITWORTHINESS OF ANY OBLIGOR, (iii)
THE VALUE OF ANY COLLATERAL SECURING PAYMENT OF THE LOAN, (iv), THE LOAN'S
FREEDOM FROM LIENS AND ENCUMBRANCES, IN WHOLE OR IN PART, (v) THE
TRANSFERABILITY AND ENFORCEABILITY OF THE LOAN NOTE AND COLLATERAL DOCUMENTS
SUPPORTING THE LOAN, OR (vi) TITLE TO OR THE CONDITION OF THE UNDERLYING
COLLATERAL INCLUDING BUT NOT LIMITED TO ANY ENVIRONMENTAL MATTER OR CONDITION,
WHETHER LATENT OR OBSERVABLE. EXCEPT AS OTHERWISE PROVIDED IN THIS AGREEMENT,
THE LOAN SOLD AND THE RIGHTS AND
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OBLIGATIONS ASSIGNED TO AND ASSUMED BY BUYER UNDER THIS AGREEMENT ARE SOLD
AND TRANSFERRED WITHOUT RECOURSE.
ARTICLE 5
CONDITIONS PRECEDENT
Section 5.1 Conditions for the Benefit of Buyer, Including Due Diligence.
Notwithstanding anything in this Agreement to the contrary, Buyer's obligation
to purchase and assume the Assigned Rights and Obligations shall be subject to
and contingent upon the satisfaction (or waiver by Buyer) of each of the
following conditions precedent, prior to or on the Closing Date:
(a) All Closing Documents necessary to consummate the
transactions contemplated in this Agreement shall have been executed and
delivered by Seller as required by this Agreement.
(b) There shall not have been any material damage or
destruction to the Collateral from the condition of the Collateral as it existed
upon the effective date of this Agreement.
(c) Neither Buyer nor Seller shall have terminated this
Agreement pursuant to the terms of this Agreement.
(d) Each and every representation and warranty of Seller
contained in this Agreement shall be true and correct in all material respects
as of the Closing Date.
Section 5.2 Conditions for the Benefit of Seller. Notwithstanding anything
in this Agreement to the contrary, Seller's obligation to sell and assign the
Assigned Rights and Obligations shall be subject to and contingent upon the
satisfaction (or waiver by Seller) of the following conditions precedent prior
to or on the Closing Date:
(a) Payment of the Purchase Price, plus sufficient funds to pay
Buyer's share of prorations and closing expenses as set forth in Sections 6.5
and 6.6 below, to Seller at the Closing.
(b) All Closing Documents necessary to consummate the
transaction as contemplated in this Agreement shall have been executed and
delivered by Buyer as required by this Agreement.
(c) Neither Buyer nor Seller shall have terminated the
Agreement pursuant to the terms of this Agreement.
(d) Each and every representation and warranty of Buyer
contained in this Agreement shall be true and correct as and when made and as of
the Closing Date in all material respects.
Section 5.3 Failure or Waiver of Conditions Precedent. In the event any of
the conditions set forth in Section 5.1 or 5.2 do not occur as of the Closing
Date, or such earlier date as set forth above, or have not been waived in
writing by Buyer or Seller, respectively,
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the party for whose benefit the failed condition exists may terminate this
Agreement by written notice to the other party, and neither party shall have any
further obligation to the other, other than as stated in the Agreement. Buyer
and Seller may, at their election, at any time or times on or before the Closing
Date, waive in writing the benefit of any of the conditions set forth in Section
5.1 or 5.2. A party's waiver of any condition to the Closing shall not
constitute a waiver by that party of any other unsatisfied conditions, or of
such party's right to terminate this Agreement based on said other unsatisfied
conditions, unless such waiver is specified in writing by such party. Buyer and
Seller agree to cooperate and to use all reasonable efforts to fulfill the
conditions set forth herein. Anything herein to the contrary notwithstanding,
Seller shall be liable to Buyer for any out of pocket costs incurred by Buyer as
a result of Seller's failed timely delivery of the Closing Documents in
accordance herewith.
ARTICLE 6
CLOSING
Section 6.1 Escrow. The Escrow contemplated by this Agreement shall be
opened by Buyer and Seller with Escrow Holder in accordance with Sections 2.4,
2.6 and 2.7 herein. On or before two (2) Business Days prior to the Closing
Date, Seller and Buyer shall deliver such additional joint escrow instructions
to Escrow Holder consistent with this Article 6 as are reasonably required by
Escrow Holder. The Closing shall be via telephone, confirmed in writing.
Section 6.2 Deliveries by Buyer. On the Closing Date, Buyer shall deliver
to Seller:
(a) the Purchase Price plus sufficient funds to pay Buyer's
share of all prorations and closing expenses as set forth in Sections 6.5 and
6.6 below by means of a wire transfer to Seller of U. S. Dollars in immediately
available federal funds;
Section 6.3 Deliveries by Seller. Seller shall deliver to Buyer the
following original Loan Documents for each Loan:
(a) the original Deed of Trust Note with all interim
assignments, amendments and modifications, and an original Allonge, duly
endorsing the Deed of Trust Note to the order of Buyer without recourse;
(b) the original recorded Deed of Trust with all interim
assignments, amendments and modifications, and Seller's duly executed original
assignment thereof, in recordable form;
(c) the original Security Agreement with all interim
assignments, amendments and modifications, and Seller's duly executed original
assignment thereof to Buyer, together with UCC assignments of security interest
sufficient for filing in the jurisdiction where the mortgaged property is
located and the jurisdiction where the Obligor is organized;
(d) the original mortgagee's title insurance policy insuring
Seller's first priority lien against the Collateral;
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(e) the original Mortgagor/Mortgagee Agreement, with all
interim assignments, amendments and modifications, and Seller's duly executed
assignment thereof to Buyer;
(f) the original Agreement of Restrictions with all interim
assignments, amendments and modifications, and Seller's duly executed assignment
thereof to Buyer;
(g) all original escrow agreements, if any, with all interim
assignments, amendments and modifications, with Seller's duly executed original
assignment to Buyer of any such escrow agreements;
(h) the originals of all other collateral documents including
all contracts, documents, files, accounts and assets related to such Loan, with
all interim assignments, amendments and modifications of each, and Seller's duly
executed original assignment to Buyer thereof;
(i) a completed HUD 920080, Mortgage Record Change; and
(j) letters to all management companies, taxing authorities,
and insurance agencies notifying them of the change of mortgagee (letters to the
insurance agencies must include a request for an endorsement to the policy
changing the named payee in the mortgagee clause); and
(k) a copy of the Regulatory Agreement between the Obligor and
HUD;
(l) an assignment of CMSLP's indemnification regarding
servicing defects and defaults existing prior to or as of the Closing Date, in
such form as set forth on Exhibit C hereto.
Section 6.4 Delivery of Loan Files and Funds. Seller agrees to deliver to
Buyer or Buyer's designee at Seller's place of business as soon as practicable
following the Closing Date each original Loan Document in Seller's possession
affecting the Loan. On the Closing Date, Seller shall deliver to Buyer via wire
transfer in accordance with Buyer's wire instructions to be provided, all
escrow, reserve and other funds and securities held in conjunction with the
Loans, and shall provide Buyer with a detailed written statement of explanation
thereof.
Section 6.5 Closing Costs. Seller and Buyer shall each pay the fees and
expenses of their respective legal counsel incurred in connection with this
transaction. Buyer shall pay all other costs and expenses related to the
transaction. Seller shall not bear the cost of any recordation fees and/or taxes
associated with selling, transferring, and assigning the Loan, including,
without limitation, recording an assignment of the Mortgage, assignments of any
financing statements, and any fees and/or taxes associated with other transfer
documents which are to be recorded in connection with the transactions
contemplated hereby. On the Closing Date, Buyer agrees to pay to Seller cash in
an amount sufficient to reimburse Seller for any costs incurred by Seller with
respect to the Closing for which Buyer is required to pay under this Agreement.
Any payments on the Loans received after Closing shall be immediately forwarded
to Buyer.
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Section 6.6 Prorations. Payments of principal and/or interest payable
pursuant to the Loan or any of the Loan Documents on or prior to the Closing
Date shall be the property of Seller and shall not be prorated as between Buyer
and Seller if received by Seller on or before the Closing Date. Any payment so
received by Seller on or prior to the Closing Date and applied in accordance
with FHA requirements shall adjust the then outstanding principal balance
accordingly.
Section 6.7 Insured Collateral. Buyer is responsible for having itself
substituted as loss payee on any collateral risk insurance in which Seller is
currently listed as a loss payee. Any loss after the Closing to either Obligor
or to Buyer or to the value or collectability of the Loan due to Seller's
cancellation of collateral risk insurance or its failure to identify Buyer as
loss payee is the sole responsibility of Buyer.
Section 6.8 Title Insurance. Seller shall have no responsibility for and
shall have no obligation to pay any costs associated with transferring and
obtaining any endorsements to any existing title policy or new title policy in
connection with this transaction.
ARTICLE 7
FILES AND RECORDS
Section 7.1 Conformity to Law. Buyer agrees to abide by all applicable
state and federal laws, and HUD requirements regarding the handling and
maintenance of all documents and records relating to the Loan purchased
hereunder including, but not limited to, the length of time such documents and
records are to be retained.
Section 7.2 Inspection by Seller. After the transfer of documents or files
to Buyer pursuant to the terms of this Agreement, Buyer agrees that Seller shall
have the continuing right to use, inspect, and make extracts from or copies of
any such documents or records, at its sole expense, in connection with any
dispute or litigation related to the Collateral or the Loan in which Seller is a
party, upon Seller's reasonable notice to Buyer.
ARTICLE 8
RELEASE AND INDEMNIFICATION OF SELLER
Section 8.1 Seller's Indemnification. Seller agrees to defend, indemnifty and
hold harmless Buyer, its affiliates, subsidiaries, its managers, members,
employees, agents, servicers and representatives from, against and in respect of
any and all loss, costs, claims, damage, liability and expense, including,
without limitation, reasonable attorneys fees and expenses arising out of or
relating in any way to the Seller's actions and inactions relating in any way to
the Collateral, the Collateral Documents or the Loan Documents, including
indemnification against any servicing defects or default by CMSLP that could
adversely affect the FHA insurance on the Loans, which actions or inactions
occurred prior to the Closing Date.
Section 8.2 Buyer's Indemnification. Buyer agrees to defend, indemnifty and
hold harmless Seller, its affiliates, subsidiaries, its managers, members,
employees, agents, servicers and representatives from, against and in respect of
any and all loss, costs, claims, damage, liability and expense, including,
without limitation, reasonable attorneys fees and expenses arising out of or
relating in any way to the Buyer's actions and inactions relating
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in any way to the Collateral, the Collateral Documents or the Loan
Documents, which actions or inactions occurred subsequent to the Closing Date.
Section 8.3 Collateral Materials. Seller has provided Buyer certain asset
summaries and other information and has provided Buyer access to certain other
materials and information, which may have included certain loan documents, title
reports, file reviews, internal analyses and memoranda, correspondence,
environmental assessments, inspection reports, operating statements, rent rolls,
surveys, engineering reports, and/or appraisals relating to the Collateral and
certain financial statements, credit reports, operating statements, internal
analyses and memoranda and other information regarding the financial condition,
management ability and other aspects of the Obligor, including, without
limitation, those certain items described in Exhibit A hereto (the above
described asset summaries, materials and other documents, information and
reports listed on Exhibit A are referred to herein as the "Collateral
Materials"). BUYER UNDERSTANDS AND ACKNOWLEDGES THAT, ALTHOUGH SELLER HAS
ATTEMPTED TO PROVIDE BUYER ACCESS TO INFORMATION IN SELLER'S POSSESSION WHICH
SELLER BELIEVED COULD BE RELEVANT, THE COLLATERAL MATERIALS WERE NOT PREPARED
FOR BUYER OR TO BE RELIED UPON BY BUYER, THAT THEY MAY BE INCOMPLETE AND
OUTDATED AND MAY CONTAIN ERRORS, OMISSIONS, AND INACCURATE AND CONFLICTING
INFORMATION, AND THAT SELLER HAS NOT ATTEMPTED TO VERIFY, CORRECT OR RECONCILE
THE INFORMATION IN THE COLLATERAL MATERIALS. BUYER UNDERSTANDS AND ACKNOWLEDGES
THAT ANY COLLATERAL REPORT WHICH MAY BE PROVIDED BY SELLER IS BEING PROVIDED
WITHOUT REPRESENTATION OR WARRANTY AS TO THE COMPLETENESS, ACCURACY OR
SUFFICIENCY OF THE FACTS, ASSUMPTIONS OR CONCLUSIONS CONTAINED THEREIN; AND
BUYER HEREBY WAIVES, RELEASES AND AGREES NEVER TO AS SERT ANY CLAIMS AGAINST
SELLER, ITS RESPECTIVE REPRESENTATIVES OR THE PREPARERS OF THE COLLATERAL
MATERIALS WHICH COULD BE ALLEGEDLY BASED UPON RELIANCE ON THE COLLATERAL
MATERIALS. BUYER HAS BEEN AND IS HEREBY EXPRESSLY ADVISED BY SELLER TO CONDUCT
AN INDEPENDENT INVESTIGATION WITH RESPECT TO THE IDENTIFICATION AND SUFFICIENCY
OF THE COLLATERAL, THE VALUE AND CONDITION OF THE COLLATERAL, THE LIEN PRIORITY
AND PERFECTION OF THE LOAN DOCUMENTS (INCLUDING, WITHOUT LIMITATION, OBTAINING
TITLE SEARCHES AND/OR, IF OBTAINABLE, LENDER'S TITLE POLICY ENDORSEMENTS OR NEW
LENDER'S TITLE POLICIES IN CONNECTION WITH THE COLLATERAL), THE FINANCIAL
CONDITION AND MANAGEMENT ABILITY OF THE OBLIGOR, THE VALIDITY AND ENFORCEABILITY
OF THE LOAN DOCUMENTS AND ALL OTHER MATTERS) WHICH COULD AFFECT THE
COLLECTIBILITY AND VALUE OF THE LOAN NOTE AND OTHER LOAN DOCUMENTS, THE ASSIGNED
RIGHTS AND OBLIGATIONS.
ARTICLE 9
BREACH OF THE AGREEMENT
Section 9.1 Seller's Breach. If Seller breaches this Agreement, and Buyer
does not
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close the transactions contemplated hereunder or such breach is discovered
after Closing, Seller shall be allowed a reasonable opportunity to cure the
breach. If the breach cannot be cured Buyer shall be reimbursed by Seller for
all costs incurred, including costs of internal counsel, and Buyer may, at
Buyer's option, pursue all of Buyer's rights and remedies that Buyer may have
under this Agreement and at law. Buyer may not recover any consequential or
punitive damages resulting from Seller's breach of the Agreement.
Section 9.2 Buyer's Breach. If Buyer defaults under this Agreement, Seller
at Seller's option, may pursue all of Seller's rights and remedies that Seller
may have under this Agreement and at law, including but not limited to,
reimbursement for costs, expenses and liquidated damages in an amount not to
exceed $10,000.00 ("Liquidated Damages").
Section 9.3 Liquidated Damages. BUYER AND SELLER ACKNOWLEDGE AND AGREE THAT
(a) IT WOULD BE IMPRACTICAL OR EXTREMELY DIFFICULT TO DETERMINE SELLER'S ACTUAL
DAMAGES IN THE EVENT OF BUYER'S DEFAULT UNDER THIS AGREEMENT, AND (b) TAKING
INTO ACCOUNT ALL OF THE CIRCUMSTANCES EXISTING ON THE DATE OF THIS AGREEMENT,
THE AMOUNT OF $10,000.00 IS A REASONABLE ESTIMATE OF SELLER'S ACTUAL DAMAGES IN
SUCH EVENT. CONSEQUENTLY, IN THE EVENT OF BUYER'S DEFAULT UNDER THIS AGREEMENT,
SELLER' S SOLE AND EXCLUSIVE REMEDY AT LAW SHALL BE TO TERMINATE THIS AGREEMENT
AND TO RECEIVE AND RETAIN THE LIQUIDATED DAMAGES.
Initials:
- ----------------------- -----------------------
Buyer Seller
Section 9.4 No Personal Liability. In no event shall any shareholder,
director, partner or officer of Seller or a Related Person be personally liable
for any obligations of Seller or Buyer under this Agreement.
Section 9.5 Intentionally Deleted.
Section 9.6 Damages Related To Collateral. Seller shall have no liability
to Buyer with respect to any damage deriving from or related to the Collateral.
ARTICLE 10
NOTICES
Unless otherwise provided for herein, all notices and other communications
required or permitted hereunder shall be in writing (including a writing
delivered by facsimile transmission and simultaneously sent by regular mail) and
shall be deemed to have been duly given (a) when delivered, if sent by
registered or certified mail (return receipt requested), (b) when delivered, if
delivered personally or by facsimile or (c) on the second following Business
Day, if sent by overnight mail or overnight courier, in each case to the parties
at the following addresses (or at such other addresses as shall be specified by
like notice):
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If to the Seller: American Insured Mortgage Investors - Series 85, L.P.
c/o CRIIMI MAE Services Limited Partnership
11200 Rockville Pike, 4th Floor
Rockville, Maryland 20852
Attention: N. Nelson Phelps, Esquire
Fax No. 301-231-0630
Email: nphelps@criimi.com
With a copy to: CRIIMI MAE INC.
11200 Rockville Pike, Suite 400
Rockville, Maryland 20852
Attention: Mark Libera, General Counsel
Fax No. 301-255-0620
Email: mlibera@criimi.com
If to the Buyer: Greystone Servicing Corporation, Inc.
419 Belle Air Lane
Warrenton, Virginia 20186
Attention: Deborah S. Cook, General Counsel
Fax No. 540-341-2192
Email: dcook@greystoneusa.com
With a copy to: Greystone & Co., Inc.
152 W. 57th Street, 60th
New York, NY 10019
Attention: Serafino Tobia
Fax No. 212-649-9701
ARTICLE 11
MISCELLANEOUS PROVISIONS
Section 11.1 Waiver of Jury Trial. WITHOUT LIMITATION OF ANY OTHER
COVENANT, RELEASE, REPRESENTATION OR WARRANTY OR ANY RIGHT OR REMEDY OF PARTIES
UNDER THIS AGREEMENT, AT LAW OR IN EQUITY, EACH PARTY HEREBY KNOWINGLY,
VOLUNTARILY AND INTENTIONALLY WAIVES ANY RIGHT THAT IT MAY HAVE TO A TRIAL BY
JURY IN ANY LITIGATION OR PROCEEDING ARISING IN ANY WAY IN CONNECTION WITH THIS
AGREEMENT, ANY OF THE DOCUMENTS EXECUTED PURSUANT THERETO OR HERETO OR IN
CONNECTION THEREWITH OR HEREWITH OR ANY OTHER STATEMENTS OR ACTIONS OF THE OTHER
PARTY. EACH PARTY ACKNOWLEDGES THAT THIS WAIVER IS A MATERIAL INDUCEMENT FOR THE
OTHER PARTY TO ENTER INTO THIS AGREEMENT AND EACH SUCH DOCUMENT, AND THAT THIS
WAIVER SHALL BE EFFECTIVE AS TO EACH OF THE DOCUMENTS AS IF FULLY INCORPORATED
THEREIN.
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Section 11.2 Severability. Each part of this Agreement is intended to be
severable. If any term, covenant, condition or provision hereof is unlawful,
invalid, or unenforceable for any reason whatsoever, and such illegality,
invalidity, or unenforceability does not affect the remaining parts of this
Agreement, then all such remaining parts hereof shall be valid and enforceable
and have full force and effect as if the invalid or unenforceable part had not
been included.
Section 11.3 Rights Cumulative: Waivers. The rights of each of the parties
under this Agreement are cumulative and may be exercised as often as any party
considers appropriate. The right of each of the parties hereunder shall not be
capable of being waived or varied otherwise than by an express waiver or
variation in writing. Any failure to exercise or any delay in exercising any of
such rights shall not operate as a waiver or variation of that or any other such
right. Any defective or partial exercise of any of such rights shall not
preclude any other or further exercise of that or any other such right. No act
or course of conduct or negotiation on the part of any party shall in any way
preclude such party from exercising any such right or constitute suspension or
any variation of any such right.
Section 11.4 Headings. The headings of the Articles and Sections contained
in this Agreement are inserted for convenience only and shall not affect the
meaning or interpretation of this Agreement or any provision hereof.
Section 11.5 Construction. Unless the context otherwise requires, singular
nouns and pronouns, when used herein, shall be deemed to include the plural of
such noun or pronoun and pronoun of one gender shall be deemed to include the
equivalent pronoun of the other gender.
Section 11.6 Assignment. Subject to Section 2.5, this Agreement may not be
assigned by Buyer without the prior written consent of Seller, which consent
Seller may grant or withhold in its sole and absolute discretion. Any attempted
assignment by Buyer without the prior consent of Seller shall be voidable by
Seller. Subject to the foregoing, this Agreement and the terms, covenants,
conditions, provisions, obligations, undertakings, rights and benefits hereof,
including the Exhibits hereto, shall be binding upon and shall inure to the
benefit of, the undersigned parties and their respective heirs, executors,
administrators, representatives, successors, and assigns.
Section 11.7 Prior Understandings. This Agreement supersedes any and all
prior discussions and agreements between Seller and Buyer with respect to the
purchase of the Loans and other matters contained herein, and this Agreement
contains the sole and entire understanding between the parties hereto with
respect to the transactions contemplated herein.
Section 11.8 Integrated Agreement. This Agreement and all Exhibits hereto
constitute the final complete expression of the intent and understanding of
Buyer and Seller. This Agreement shall not be altered or modified except by a
subsequent writing, signed by Buyer and Seller.
Section 11.9 Counterparts. This Agreement maybe executed by fax (if
promptly followed by the original) and in any number of counterparts, each of
which shall constitute
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one and the same instrument, and either party hereto may execute this
Agreement by signing any such counterpart.
Section 11.10 Survival. Each and every covenant herein made by the Buyer
and Seller shall survive the Closing and shall not merge into the Closing
Documents, but instead shall be independently enforceable.
Section 11.11 Governing Law. This Agreement shall be construed, and the
rights and obligations of the Seller and the Buyer hereunder determined, in
accordance with the local law of the State of New York.
Section 11.12 Expenses. Except as expressly set forth to the contrary in
this Agreement, each party hereto shall be responsible for and bear all of its
own respective expenses, including without limitation, expenses of legal
counsel, accountants, and other advisors, incurred at any time in connection
with pursuing or consummating this Agreement and the transactions contemplated
thereby.
Section 11.13 Brokers. Each party to this Agreement represents and warrants
to the other that, in connection with the sale and purchase of the Loan, the
party so representing and warranting has not dealt with any real estate broker,
agent or finder Buyer and Seller shall indemnify and hold each other harmless
against and from any inaccuracy in such representation. The rights, obligations,
warranties and representations of the parties hereto under the provisions of
this Section 11.13 survive Closing or any termination of this Agreement before
Closing.
Section 11.14 Effectiveness Of The Agreement. This Agreement shall not be
deemed a contract binding upon the parties hereto unless and until it is fully
executed and delivered.
Section 11.15 Attorneys' Fees. In the event any dispute between Buyer and
Seller should result in arbitration or litigation, the prevailing party shall be
reimbursed for all reasonable costs incurred in connection with such litigation,
including, without limitation, reasonable attorneys' fees.
Section 11.16 Further Assurances. From and after the date of this
Agreement, each party shall provide to the other party such other information
regarding the Loans or the Collateral as the other party may reasonably request,
and each party shall execute and deliver such other documents, deliver such
other items and take such other actions as may be reasonably requested to allow
the completion and consummation (or termination, as appropriate) of all tasks
and the transactions contemplated by this Agreement.
Section 11.17 Publicity. Neither party to this Agreement shall release any
information concerning the transaction contemplated by this Agreement to the
public by any means, including, but not limited to, a press release, or a
tombstone or other advertisement, without the prior written consent and approval
of the other party hereto.
Section 11.18 Confidentiality. In no event shall either party to this
Agreement issue any press release to any media of general circulation regarding
this Agreement or the transactions contemplated hereby or otherwise disclose the
terms and conditions of this
15
Agreement (other than a press release providing that the Buyer has acquired
the Loan, which shall not disclose the terms of the acquisition); provided
however that nothing herein shall be deemed to limit or impair in any way any
party's ability to disclose the details of the transaction contemplated hereby
to its affiliates, subsidiaries or legal and financial advisors or as may be
necessary pursuant to any governmental order or applicable law or in litigation.
Notwithstanding the foregoing, no party hereunder shall have any liability by
reason of the details of the transaction contemplated hereby becoming known by
means beyond the reasonable control of such party. This Section shall be
supplemental to and not in derogation of the provisions of any Confidentiality
Agreement entered into between Buyer and Seller.
Section 11.19 Time of Essence. All parties hereto agree that time is of the
essence with respect to this Agreement.
ARTICLE 12
Section 12.1 Non-Solicitation of Obligors. Seller and its affiliates shall
be prohibited from soliciting or otherwise causing the refinance of the Loans
during the remaining terms thereof.
(SIGNATURE PAGE FOLLOWS)
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first above written.
SELLER:
American Insured Mortgage Investors - Series 85, L.P.
By: CRIIMI, Inc., its general partner
By:/s/Mark Libera
------------------------------------------
Name: Mark Libera
Title: Vice President
BUYER:
Greystone Servicing Corporation, Inc.
By:/s/Betsy Vartanian
------------------------------------------
Name: Betsy Vartanian
------------------------------------------
Title: Executive Vice President
------------------------------------------
17