Exhibit 10.11
PURCHASE CONTRACT
THIS AGREEMENT made and entered into this 25th day of April 1996,
between CORNERSTONE REALTY GROUP, INC. or its nominee, (hereinafter called
"Purchaser") and WILLOW CREEK APARTMENTS, LTD., (hereinafter
called "Seller").
ARTICLE I
The Property
1.1 Sale of Property. Seller agrees to sell and convey, and Purchaser agrees to
purchase, Seller's real property known as WILLOW CREEK APARTMENTS located in
DURHAM, NC, with all buildings and improvements located thereon, as more
particularly described in the attached legal description in Exhibit A including,
but not limited to 200 individually heated and air conditioned apartment units,
with all appurtenances, together with all property used in connection with the
premises, including, the inventory of personal property to be supplied by Seller
and attached hereto as Exhibit B (all such real and personal property
hereinafter collectively referred to as the "Property" unless the context
clearly indicates otherwise).
ARTICLE II
Payment of Purchase Price
2.1 Purchase Price. The total purchase price shall be EIGHT MILLION FOUR HUNDRED
THOUSAND ($8,400,000) DOLLARS as evidenced by cash or cash equivalent at closing
provided that closing occurs on or before April 30, 1996. If closing occurs
during May, 1996, the total purchase price shall be EIGHT MILLION THREE HUNDRED
TWENTY-FIVE THOUSAND ($8,325,000) DOLLARS as evidenced by cash or cash
equivalent at closing. In no event shall closing occur later than May 31, 1996
or shall the total price be less than $8,325,000. (The total purchase price as
defined in this paragraph shall hereinafter be referred to as "Purchase Price".)
2.2 Deposit. $50,000 to be placed in escrow at the end of the "Inspection
Period" described in Article VI below. Said deposit shall be placed in escrow
with the Title Company of North Carolina or its authorized agent as an earnest
money deposit which may be credited against the purchase price or applied as per
Article XI below.
2.3 Closing in Escrow. The parties shall comply with all of the required
documentation prior to April 30, 1996 and
deposit all documents in escrow with the title company set forth in the above
Paragraph 2.2. At said time, the Purchaser shall assume all of the benefits and
liabilities of ownership, including the management of the property, with the
actual closing taking place as soon as this matter is cleared for closing by the
Bankruptcy Court at which this matter is currently pending. The Purchase Price
shall be paid by (i) payment from Purchaser to Seller at closing the amount by
which the Purchase price exceeds the amount due from the Seller to HUD under the
Seller's confirmed bankruptcy plan ("Plan") and the Consent Order Regarding
Allowed Claim of HUD, as amended ("Consent Order") as of the date of closing;
and (ii) payment from Purchaser to Seller (or Seller's assignee) on May 31, 1996
the amount by which the Purchase Price exceeds the amount paid under (i) of this
paragraph. In all events, the Purchaser shall have paid to Seller by May 31,
1996 the Purchase Price as defined in Paragraph 2.1. All payments to be held by
the title company in an interest-bearing account.
2.4 Best Efforts. Seller and Purchaser hereby agree to use their best efforts to
close all transactions contemplated by this Agreement on or before May 30,
1996.*
2.5 HUD Mortgage. Seller and Purchaser acknowledge that at the date of closing
the Property will be encumbered by an existing mortgage in favor of HUD, which
mortgage is in the amount of $6,433,752.85 as of February 21, 1996 and which
shall be reduced by any payments made to HUD after that date ("HUD Mortgage").
The HUD Mortgage is due and payable on June 1, 1996 and the HUD Mortgage does
not bear interest. Seller and Purchaser hereby agree that any and all
obligations of the Seller under the HUD Mortgage and the Plan shall be prorated
in accordance with Paragraph 4.1 and that any payments made on the HUD Mortgage
shall inure to the benefit of the party whose funds were used to make such
payments. The Seller and Purchaser agree to use their best efforts to obtain
from HUD, on May 31, 1996 in conjunction with the payment of the balance due on
the HUD Mortgage, an assignment of the HUD Mortgage and collateral documents to
such entity as Purchaser may direct. BOTH SELLER AND PURCHASER EXPRESSLY
RECOGNIZE THAT THIS AGREEMENT IS SUBJECT TO THE EXPRESS APPROVAL OF THE
BANKRUPTCY COURT AND THE FAILURE OF THE BANKRUPTCY COURT TO APPROVE THIS
AGREEMENT, AS AMENDED, SHALL RENDER THIS AGREEMENT NULL AND VOID.
ARTICLE III
Title Matters
3.1 Marketable Title. Seller, shall convey good and marketable title by General
Warranty Deed, subject to general taxes for the current year not yet due and
payable, utility easements of record which could not reasonably interfere with
the present use of the Property and existing deed restrictions.
(A) Title shall be free from any and all liens or
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* The parties further agree to take whatever steps are necessary to receive an
assignment of the mortgage to the Purchaser or its nominee and Seller will
provide Purchaser with a deed in lieu of foreclosure.
mortgages as of June 1, 1996 and Seller shall be responsible for any prepayment
penalties necessary to delivery such free title as of June 1, 1996.
3.2 Title Defects; Election to Cure. If title is not marketable,
except as stated above in the preceding paragraph, Purchaser shall give written
notice of any defects in title to Seller's counsel within five (5) days after
Purchaser's receipt of a title report which report shall include copies of
backup documents relating to any title exceptions, a current survey, a flood
zone certification letter and a Surveyor's Certification letter. Seller may,
at its option, elect whether to cure said defects or by written notice to
Purchaser indicate its intention not to cure. The commitment shall be furnished
without cost to Purchaser, except and unless Purchaser obtains a policy.
3.3 Election Not to Cure Defects. Should Seller elect not to cure title
defects, this Agreement, at Purchaser's option, shall be void; each party
shall thereupon be released from all obligations hereunder; and all deposits
shall be immediately returned to Purchaser.
ARTICLE IV
Prorations
4.1 Income and Expense Allocations. The following shall be prorated, on a
calendar-month basis as of the first (1st) day of the month in which closing
occurs: rents and other income from the Property; operating expenses (on such
service contracts and other obligations as Purchaser may agree to assume); and
general and real property taxes and personal and business property taxes for the
year of closing (based on the most recent assessment and the most recent levy).
4.2 Closing Costs. Purchaser and Seller shall pay their customary share of all
taxes, recording fees, if any, imposed on the Deed, or any other documents
executed in connection with the transfer of the Property. Purchaser agrees to
pay cost of title insurance. Seller shall pay any prepayment penalty charged by
the holders of any existing notes.
4.3 Allocation of Rents. Rents collected by Seller prior to Closing shall be
prorated as agreed in 4.1 above. Purchaser shall apply rents received after
Closing first to payment of the current rent due to Purchaser, then to
delinquent rents due to Purchaser, and last to rents due to Seller as of the
Closing but uncollected prior to settlement. Purchaser agrees to use its best
efforts in good faith to collect the amount of any rental arrears from tenants
and Purchaser agrees to remit promptly to Seller any such arrears actually paid
by such tenants to Purchaser. Seller shall retain the right to commence legal
action against a tenant
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for any delinquent rent apportioned to the Seller.
4.4 Prior Lease Concessions. Seller has no knowledge of any future rent
concessions other than those for employees of the managing company and has
consulted with the managing company regarding the same.
ARTICLE V
Possession of the Property and
Indemnification by Purchaser
5.1 Possession. Possession of the Property shall be delivered to Purchaser at
closing, subject to the rights of the tenants under existing leases and rental
agreements. Additionally, the Property shall be delivered to the Purchaser at
closing subject to the existing Section 8 Contract on 40 units. The existing
Section 8 Contract shall remain in place for its duration, but Purchaser is
under no obligation to continue the Section 8 Contract beyond its stated
expiration.
5.2 Indemnification. Purchaser acknowledges that it is assuming certain
obligations of Seller to HUD under the HUD Mortgage and collateral loan
documents, as amended in the Plan, and the existing Section 8 Contract
("Obligations"). Purchaser agrees to hold harmless and indemnify Seller from any
and all claims under the Obligations from and after the closing. Such indemnity
shall include reasonable attorneys' fees.
ARTICLE VI
Conditions Precedent to Closing
6.1 Conditions Precedent. Purchaser's obligation to purchase shall be subject to
and contingent upon the satisfaction of the following conditions precedent:
(A) Receipt by Purchaser of an engineering report of building and site
conditions, reasonably satisfactory to Purchaser, said report to include in
part, a description of any hazardous waste sites, hazardous wastes and/or
hazardous materials affecting the property. Purchaser shall have until April 26,
1996 in which to review the reports set forth herein and exercise its right to
reject the Property based thereon or the right hereunder shall be deemed waived.
Purchaser hereby agrees to instruct the entity preparing the engineering report
to provide a copy of such report to Seller simultaneously upon provision to
Purchaser.
(B) The receipt by Purchaser of Seller documents described in 7.2 below.
(C) On the condition that Sellers representations and warranties described in
Article VIII below remain true and correct.
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(D) On the condition that there have been no material or adverse changes to the
property or leases.
(E) Seller acknowledges that Purchaser is a public entity and that it is
required to furnish financial statement to the Securities and Exchange
Commission in connection with this acquisition. Seller agrees to make the
information available for Purchaser to audit the last 12 months of operation of
the Property so that a report can be generated that is in compliance with
accounting Regulation S-X of the Securities and Exchange Commission.
(F) Purchaser shall have until May 1st to procure a Survey which shall show no
encroachments onto the Land from any adjacent property, no encroachments by or
from the Land onto adjacent property and no violation of or encroachments upon
any recorded building lines, restrictions or easements affecting the Property.
If the Survey discloses any such encroachment or violation, Seller shall have
five (5) days from the date of delivery of the Survey (with a commensurate
extension of the closing date) to have the Title Insurer issue its endorsement
insuring against damage caused by such encroachment or violation and to provide
evidence thereof to Purchaser, and if Seller fails to or is unable to have the
same insured against within such five (5) day period, Purchaser may elect, on or
before the Closing Date, to (i) terminate this Agreement (in which case the
Earnest Money shall be returned to Purchaser) and neither party shall have any
further liability or obligation to the other hereunder, or (ii) accept the
property subject to any such encroachment or violation.
6.2 Inspection. This Agreement shall be further subject to and contingent upon
Purchaser's satisfactory inspection as follows herein below.
6.2.1 Preparation for Inspection. At the execution of this Agreement, Seller
shall use its best efforts to deliver to Purchaser copies of the following: The
current rent roll for the Property; detailed statements of income and expenses
with respect to the Property for the past two years; the most recent tax bills
for the Property; utility bills for the Property for the twelve (12) months
previous to the date hereof; all contract, mortgages, and other documents
creating liens of security interest on the Property; or any part thereof and all
promissory notes secured thereby; all insurance policies applicable to the
Property to include loss runs for the last five (5) years; Plans and
Specifications for the Property, service contracts, Certificates of Occupancy,
to the extent reasonably available); a copy of the title policy and most recent
survey for the Property. A copy of any environmental or engineering reports on
the property. All these items shall be certified by Seller to be accurate and
complete to the best of its knowledge and belief. In the event Purchaser has not
received any of the documents referenced by this Paragraph
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6.2.1 by April 26, 1996, Purchaser shall notify Seller in writing by April 29,
1996 or waive the right to receive such documents.
6.2.2 Inspection of Books and Records; Access. Purchaser, its employees, agents
and contractors shall have until April 22, 1996 (the "Inspection Period") to
enter upon the Property subject to the rights of the tenants during normal
business hours for the purpose of making physical inspections thereof, including
but not limited to roofs, heating, cooling, electrical and plumbing systems,
swimming pool, appliances, and structural elements of the buildings. Upon the
conclusion of the Inspection Period this contract shall be deemed to be a firm
agreement of purchase and sale binding the parties hereto, except as it may be
terminated by other provisions and conditions contained herein, including but
not limited to the condition imposed by Paragraph 6.1(A) above.
6.2.3 Right of Termination During Inspection Period. Purchaser shall also be
permitted to review all original leases, expense records, tenant cards and
occupancy data available. If Purchaser is not satisfied, in its sole and
exclusive discretion, with the state of maintenance and repair of the Property
or the rents, occupancy or expenses of the Property, then notwithstanding
anything contained herein to the contrary, Purchaser shall have the right to
terminate this Agreement by giving written notice to Seller before the end of
the Inspection Period, and no party hereto shall have any further liability to
any other party hereto, and all deposits shall be returned to Purchaser.
6.2.4 "Rent Ready". During the "Inspection Period", both Seller and Purchaser
will inspect an apartment unit at the Property and mutually agree that said
apartment shall be representative of a "rent ready" unit by which all other
units shall be judged for "rent ready" condition at closing. All vacant
apartment units, are to be in a "rent ready" condition (as defined above), at
the time of closing, containing, but not limited to the following amenities,
i.e., carpet, refrigerator, range, garbage disposal, heating, plumbing and
electrical systems.
6.2.5 Condition of Personal Property at Closing. All personal property included
in the sale and all mechanical, electrical, heating, air conditioning, sewer,
water and plumbing systems will be in the same working order at the time of
closing and in the same condition as at the time of the initial inspection by
Purchaser. If Seller fails to make reasonable efforts to conserve the property
and Seller does not pay at closing for any damages resulting from Seller's
failure to make reasonable efforts to conserve the property, Purchaser shall
have the option of waiving such requirement, in writing, and proceeding to
closing, or Purchaser may void this Agreement and obtain a prompt return of its
deposit. This clause shall survive closing for three (3) business days.
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6.2.6 Satisfaction of Due Diligence Requirement. The Purchaser acknowledges
receipt of all documents required from Seller for the completion of its
inspection.
ARTICLE VII
Closing
7.1 Closing. Closing will be held on or before May 31, 1996 at such place and at
such time as the parties may agree.
7.2 Seller's Deliveries. At closing, Seller shall execute and deliver to
Purchaser the General Warranty Deed referred to in Paragraph 3 hereof and shall
also execute, where necessary, and deliver to Purchaser, the following:
(A) A Bill of Sale, with warranty of title transferring the personal property
(as shown in Schedule B) to Purchaser free of all liens, charges and
encumbrances, except any and all liens in favor of HUD and other encumbrances of
record.
(B) Originals or copies of all signed leases and rental agreements in effect
with tenants of the Property.
(C) All security deposits made by such tenants. Seller will give the tenants the
required notice of such transfer in compliance with the laws of North Carolina.
(D) As affidavit of Seller in such form as will cause the Title Company to omit
from the title insurance policy the exclusion relating to unrecorded mechanic's
and materialmen's liens.
(E) A rent roll certified by Seller to be true and correct as of the date of
closing showing the name of, and the amount of monthly rental payable, by each
tenant of the Property, the apartment occupied by the tenant, the date to which
rent has been paid, any advance payment of rent, and the amount of any escrow,
or security deposit of tenant.
(F) A standard affidavit of Seller as required by the title company that to the
best of its information and belief there are, on the date of closing, no
unsatisfied judgments, creditor's claims or tax liens involving Seller, which
would affect the title to the Property.
(G) Purchaser shall provide its own termite bond.
(H) Assignments of all Seller's interest in the following: (1) all assignable
licenses, and permits relating to the operation of the Property, (2) the leases
and rental agreements with tenants of the Property, (3) the existing Property
telephone
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number and (4) the business and trade name as set forth in Par. 1.1.
(I) Assignments of all warranties and guarantees to the extent such are still in
effect and provide Purchaser with copies of all such warranties and guarantees
without limitation for all appliances, dishwashers, disposals, refrigerators,
heating and air conditioning units, washers and dryers.
(J) Evidence satisfactory to Purchaser that all water, sewer, gas, electric,
telephone, and drainage facilities and all other utilities required by law or by
the normal use and operation of the Property are and at the time of closing will
be installed to the property line, are and at the time of closing will be
connected pursuant to valid permits, and are and at the time of closing adequate
to service the Property and to permit full compliance with all requirements of
law and normal usage of the Property by the tenants thereof and their licenses
and invitees.
(K) Consent of the Seller's authorized officer to the sale of the Property and
any other approvals required under Seller's articles or by-laws, which may
affect Seller's ability to convey marketable title.
(L) Provide documents for the transfer of the telephone, electric, water and
sewer, and gas utilities, as may be required by the utility, for execution at
closing.
(M) Satisfactory evidence of the power and authority of Seller to enter into and
consummate this agreement, including but not limited to:
(i) An opinion of Seller's counsel, in a form satisfactory to Purchaser, stating
that:
(a) The individual(s) executing the deed and related documents are duly
authorized to do all such acts as are necessary to consummate this sale, without
further consent of any other party.
(b) That the partner or officer can bind the Partnership or Corporation.
(N) Affidavit that Seller has no actual knowledge of the presence of asbestos
and/or any other hazardous material at the Property.
(O) Seller shall provide a satisfactory and valid written termination of the
management agreement executed by the existing management and rental agent for
the Property, without cost to the Purchaser.
(P) A notice letter to all the residents of the apartment complex as to change
of ownership in the form prepared by the Purchaser.
(Q) All such other documents as are normally transferred at settlement in the
jurisdiction in which the property is located or are reasonably requested by
Purchaser or its counsel.
(R) A representation letter as normally required by auditors for a public
company in the form attached hereto as Exhibit C.
7.3 Purchaser's Deliveries. At closing and contemporaneously with the Seller's
compliance with the provisions of Section 7.2, Purchaser shall:
(A) Pay to Seller the cash portion of the purchase price, adjusted for the
prorations herein provided for in Articles II and IV.
(B) Execute and deliver an assumption of obligations under leases, securities,
any contracts which may be accepted by the Purchaser and any other obligations
specifically set forth herein.
(C) Deliver to the Seller a resolution of the Purchaser that:
(i) This Agreement has been duly authorized, executed and delivered by the
Purchaser and is a valid and binding agreement of Purchaser, and
(ii) Purchaser has complete unrestricted power to buy the Property from the
Seller and to execute any documents required to effectuate the transfer.
ARTICLE VIII
SELLER'S REPRESENTATIONS, WARRANTIES AND COVENANTS
8.1 Representations of the Parties. Seller warrants (which warranties shall not
survive settlement for more than ninety (90) days unless designated to the
contrary) that as of the date of closing hereof:
(A) That Seller, is the owner in fee simple of the Property and has the power to
convey same upon the express approval of the bankruptcy court.
(B) That Seller is not subject to any other agreements or arrangements, with the
exception of those contained in any existing mortgage documents or in the
Seller's pending bankruptcy proceeding which would prevent Seller from selling
the Property to Purchaser.
(C) All necessary action has been taken by Seller to authorize the execution of
this Agreement and the performance of the obligations contemplated hereunder,
which are not excluded elsewhere in existing mortgage documents.
(D) Seller has no actual knowledge and has not been advised in writing that it
is in default under any lease, rental agreement service or equipment contract,
or mortgage or other encumbrances relating to the Property except as affected by
the bankruptcy.
(E) Seller has no actual knowledge of any patent or latent defect in the
Property or any part thereof.
(F) Seller has no actual knowledge of any existing or threatened litigation
which relates to or which would affect the Property.
(G) The Property abuts on and has direct vehicular access to a public road.
(H) All building and other improvements at the Property are located entirely
within the boundary lines of the Property.
(I) Seller has no actual knowledge that any part of the Property or the
operation of the Property, is in violation or may violate any governmental
statute, regulation, ordinance or building code or of any private restriction,
that any governmental authority requires any work to be done on or affecting the
Property, or that any governmental authority has expressed an intent to condemn
or to make special improvements for the benefit of the Property or any part
thereof.
(J) That to the best knowledge of the Seller, the drainage within the project is
satisfactory and complies in all respects with all government regulation.
(K) That Seller is not a "foreign person" within the meaning of the Internal
Revenue Code of 1954, as amended (the "Code"), and that Seller will furnish to
Purchaser prior to closing an affidavit in form satisfactory to Purchaser
confirming the same.
(L) That to the best of Seller's actual knowledge, the Property was never
utilized as a disposal site for hazardous waste products and will furnish to
Purchaser an affidavit confirming same.
(M) Seller covenants and agrees that, between this date and the date of closing,
Seller shall continue to maintain, operate and manage the Property in a manner
consistent with its prior practices, making every reasonable effort to do
nothing which might damage the reputation of the Property or the relationships
with the tenants. Seller shall not permit the modification, extension or
cancellation of any tenant lease (except in accordance with the terms of such
lease) or any dealing with any tenant other than the ordinary course of managing
the Property, without the prior written consent of Purchaser. If the leases of
any tenants expire before thirty (30) days after the date of closing, Seller
shall, up to the date of closing and without cost to the Purchaser, continue its
normal course of operation with respect to causing tenants to be obtained for
apartments which are unrented.
8.2 Continuation of Representations, Warranties and Covenants to the Date of
Closing. If each of the warranties set forth in this section does not remain
true up to and including the time of closing as to any material matters, this
Agreement, at Purchaser's election, shall be terminated, Seller shall return all
payments made by Purchaser, or Purchaser may elect to close the sale and waive
failure of the warranties.
8.3 (A) Breach of Representations, Warranties and Covenants. Notwithstanding the
provisions of 8.2 above, Seller shall indemnify Purchaser for all reasonable
costs incurred as a result of the failure of any of Seller's representations,
warranties or covenants contained herein to remain true as of the date of
closing.
(B) Non-Recourse Agreement. Any and all warranties and representations contained
in this Agreement shall be deemed to have been made solely by the Seller and not
by any of its general or limited partners. Additionally, any and all liability
of individual partners under this Agreement shall be non-recourse in nature.
Purchaser expressly acknowledges that neither its general or limited partners
shall have any personal liability under this Agreement.
ARTICLE IX
CONDEMNATION; RISK OF LOSS
9.1 Property Damage. If, prior to closing, any part of the Property is damaged
by fire or other casualty, Seller shall repair such damage before the date
provided herein for closing. If such damage cannot be repaired by such time,
this Agreement may be canceled at the option of the Purchaser. In the event of
cancellation as aforesaid, this Agreement shall become null and void and the
parties shall be released and all payments made shall be returned. Should
Purchaser elect to carry out this Agreement despite such damage Seller shall
assign to Purchaser all insurance proceeds arising from such damage and will
compensate Purchaser for lost rent collections to the extent of insurance
proceeds received. Seller shall promptly notify Purchaser in writing upon the
occurrence of any such damage.
9.2 Condemnation. In the event of any actual or threatened taking, pursuant to
the power of eminent domain, all or any part thereof,or any actual or proposed
sale in lieu thereof, the Seller shall give written notice thereof to the
Purchaser promptly after Seller learns or receives notice thereof. Upon a taking
of a material part of the Property (any part of the building or more than 5% of
the parking area), Purchaser may elect to either (a) terminate this Agreement,
in which event the Deposit shall be immediately returned to Purchaser and all
other rights and obligations of the parties hereunder shall terminate
immediately, or (b) to waive its right to terminate this Agreement and proceed
to closing, in which event all proceeds, awards and other payments arising out
of such condemnation or sale (actual or threatened) shall be paid to the
Purchaser at closing, if such payment has been received or Seller shall assign
to Purchaser the rights to such payments.
9.3 Risk of Loss. Prior to closing, all risks of loss or damage by every
casualty shall be borne by the Seller.
ARTICLE X
BROKER'S COMMISSION
10.1 Commission. Seller agrees to pay a brokerage fee to PERCIVAL'S INC. not to
exceed Fifty Thousand ($50,000) Dollars, pursuant to a separate agreement
between Seller and Broker. Said brokerage fee shall be deemed earned if, and
only if, settlement occurs hereunder, and shall not be deemed earned even if
Purchaser and/or Seller wrongfully fail(s) to consummate the purchase and sale
herein contemplated. Purchaser shall not be obligated for any brokerage fees to
any broker, and Seller agrees to hold Purchaser harmless in connection with such
fees. Seller and Purchaser represent and warrant to each other that no other
brokerage fees are or shall be owing in connection with this transaction or in
any way with the Apartments and Seller and Purchaser hereby indemnify and hold
the other harmless from any and all claims of any other person so claiming.
ARTICLE XI
DEFAULT
11.1 Default Defined. Default for the purpose of this Agreement shall mean any
failure by Seller or Purchaser to fulfill all the terms, conditions and
covenants contained herein, however, it shall not be an event of default for
either party to exercise its rights to terminate this contract as contained in
other provisions herein.
11.2 Seller's Default. Upon Seller's default, the Purchaser, at it's election,
may either (1) require specific performance of Seller, or pursue its other
remedies at law or equity, (2) cancel this Agreement and obtain a prompt return
of the deposit, in which case this Agreement shall be terminated and the parties
released from all obligations hereunder, or (3) the Purchaser may waive such
defaults and proceed to settlement. Seller shall indemnify Purchaser for any
reasonable costs incurred by Purchaser if Purchaser elects to pursue its option
(1) noted above, to include reasonable attorney fees.
11.3 Purchaser's Default. Upon Purchaser's default, this Agreement shall be
terminated and both parties released from all obligations hereunder, and the
deposit shall be retained by the Seller as liquidated damages or in the
alternative the Purchaser shall have the same remedies as are available to the
Seller in Paragraph 11.2.
ARTICLE XII
MISCELLANEOUS PROVISIONS
12.1 Entire Agreement. This Agreement sets forth the entire understanding
between the parties; it supersedes all previous agreements and representations
which are deemed merged herein and may not be modified except in writing.
12.2 Assignment. Purchaser may assign this Agreement without the Consent of
Seller.
12.3 Severability. If any provision, sentence, phrase or word of this Agreement
or the application thereof to any person or circumstance shall be held invalid,
the remainder of this Agreement or the application of such provision, sentence,
phrase, or word to persons or circumstances, other than those as to which it is
held invalid, shall remain in full force and effect.
12.4 Binding Effect. The parties to the Agreement mutually agree that it shall
be binding upon and inure to the benefit of their respective heirs,
representatives, successors in interest and assigns.
12.5 Controlling Law. It is the intent of the parties hereto that all questions
with respect to the construction of this Agreement and the rights and
liabilities of the parties shall be determined in accordance with the provisions
of the laws of the State set forth in Par. 1.1.
12.6 Counterparts. To facilitate execution, this Agreement may be executed in as
many counterparts as may be required. It shall not be necessary that the
signature on behalf of both parties hereto appear in each counterpart hereof,
and it shall be sufficient that the signature on behalf of both parties hereto
appear on one or more such counterparts. All counterparts shall collectively
constitute a single contract.
12.7 Incorporation by Reference. All of the Exhibits referred to herein and/or
attached hereto shall be deemed to constitute a part of the Agreement.
12.8 Headings. The headings of the Articles and sections hereof are inserted for
convenience only and shall not be deemed to constitute a part of the Agreement.
12.9 Construction of Contract. Each party hereto have reviewed and revised (or
requested revisions of) this Agreement, and therefore the normal rule of
construction that any ambiguities are to be resolved against a particular party
shall not be applicable in the construction and interpretation of this Contract
or any amendments or exhibits hereto.
ARTICLE XIII
NOTICE
13.1 Notice. All notices required or permitted to be given under this Agreement
shall be in writing and shall be sent or delivered to the address set forth
below (or such other address as may be hereafter specified in writing):
To Seller:
Willow Creek Apartments, Ltd.
c/o G.F. Marshall
16 E. Rowan Street, Suite 402
Raleigh, NC 27609
With a copy to
Seller's Attorneys: Ashley H. Story
Wyche & Story
P.O. Box Drawer 1389
Raleigh, NC 27602
To Purchaser: S. J. Olander
Cornerstone Realty Group, Inc.
306 E. Main Street
Richmond, VA 23219
With a copy to
Purchaser's Attorneys: Harry S. Taubenfeld, Esq.
Zuckerbrod & Taubenfeld
575 Chestnut St., P.O. Box 488
Cedarhurst, NY 11516
and
Alison R. Clayton, Esq.
Manning Fulton & Skinner
3605 Glenwood Ave., POB 20389
Raleigh, NC 27619-0389
13.2 Delivery of Notice. Notices sent either by Registered or Certified Mail,
Return Receipt Requested, or by overnight express mail shall be deemed given
when deposited in the United States Mail, postage prepaid, or delivered to a
reliable overnight courier. Notices sent in any other manner shall be deemed
given only when actually delivered at the specified address.
IN WITNESS WHEREOF, the Seller and the Purchaser have caused this Agreement to
be executed this day and date first written above.
SELLER:
WILLOW CREEK APARTMENTS, LTD.
By: /s/ GENERAL PARTNER
Its: General Partner
PURCHASER:
CORNERSTONE REALTY GROUP, INC.
By: /s/ SENIOR VICE PRESIDENT
Its: Senior Vice President