AGREEMENT OF SALE
THIS AGREEMENT, entered into as of the 25 day of September, 1996, by and
between AIMCO PROPERTIES, L.P., a Delaware limited partnership ("Purchaser")
and SPRINGS POINTE INVESTORS, an Illinois Limited Partnership ("Seller").
WITNESSETH:
1. PURCHASE AND SALE. Purchaser agrees to purchase and Seller agrees to
sell at the price of Twenty Million Forty-Six Thousand Eleven and No/100
Dollars ($20,046,011.00) ("Purchase Price"), the Real Property, the Personal
Property and the Intangible Property (each as hereinafter defined), which shall
be collectively referred to herein as the "Property". As used herein, the term
"Real Property" shall include (i) the real property located at 5010 Indian
River Drive, Las Vegas, Nevada, as more particularly described on Exhibit "A"
attached hereto (the "Land"), (ii) all buildings, improvements, structures and
fixtures now or hereafter located on or in the Land including, without
limitation, the 484 condominium apartment units and such units' respective
interests in the Common Area and Improvements (as such terms are defined in the
Declaration of Covenants, Conditions and Restrictions), (iii) all apparatus,
equipment and appliances affixed to and used in connection with the operation
or occupancy of the Land and the improvements (such as heating, air
conditioning or mechanical systems and facilities used to provide any utility
services, refrigeration, ventilation, waste disposal or other services) and now
or hereafter located on or in the Land or the improvements, and (iv) all of the
rights, privileges and easements appurtenant to or used in connection with the
Land and the improvements, including, without limitation, all rights to
minerals, oil, gas and other hydrocarbon substances (to the extent owned by
Seller), all development rights, air rights, water, water rights, sewer rights
and water stock relating to the Land, all strips and gores, all of Seller's
right, title and interest in and to any streets, alleys, easements,
rights-of-way, public ways, or other rights appurtenant, adjacent or connected
to the Land. As used herein, the term "Personal Property" shall mean all of
that certain tangible personal property, equipment and supplies owned by Seller
and situated at the Real Property and used by Seller in connection with the
use, operation, maintenance or repair of the Real Property, including, without
limitation, all Personal Property described on Exhibit "B" attached hereto. As
used herein, the term "Intangible Property" shall mean all of that certain
intangible property owned by Seller and used by Seller in connection with the
Real Property and/or the Personal Property, including, without limitation, all
of Seller's right, title and interest in, to and under: (i) the Tenant Leases,
all contract rights, books, records, reports, test results, environmental
assessments, as-built plans, specifications and other similar documents and
materials relating to the use, operation, maintenance, repair, construction or
fabrication of the Real Property or the Personal Property; (ii) all trademarks
and trade names, including, without limitation, all of Seller rights, if any,
in and to the name "Springs Pointe Apartments"; (iii) all transferable business
licenses, architectural, site, landscaping or other permits, applications,
approvals, authorizations and other entitlements affecting the Real Property;
(iv) the Service Contracts and all transferable guarantees, warranties, and
utility contracts relating to the Real Property; and (v) the Declaration of
Covenants, Conditions and Restrictions. As used herein, the term "Declaration
of Covenants, Conditions and Restrictions" shall mean that certain Declaration
of Covenants, Conditions and Restrictions for the Condominium Development of
Westwood Point, Clark County, Nevada recorded July 16, 1982 in Book 1595 of the
Official Records of Clark County, Nevada (the "Official Records") as Document
No. 1554934, as modified by that certain First Amendment thereto recorded
December 6, 1982 in Book 1656 of the Official Records as Document No. 1615701
and by that certain Second Amendment thereto recorded April 26, 1990 in Book
900426 of the Official Records as Document No. 00316.
2. PURCHASE PRICE. The Purchase Price shall be paid as follows:
a. On or before the expiration of the Approval Period (as
hereinafter defined), the sum of $344,729.00 ("Earnest Money") to be held in
escrow by the Escrow Agent (as that term is defined in the Escrow Agreement),
by and in accordance with the provisions of the Escrow Agreement ("Escrow
Agreement") attached hereto as Exhibit C;
b. On the Closing Date (as hereinafter defined), $20,046,011.00
(inclusive of all Earnest Money) adjusted in accordance with the prorations by
federally wired "immediately available" funds delivered to the Title Insurer
(as hereinafter defined) no later than 12:00 Noon Central Time on the Closing
Date. If the funds are not received by 12:00 Noon Central Time, then on the
Closing Date, Purchaser shall pay Seller an amount equal to any additional
mortgage per diem interest costs incurred by the Seller.
3. TITLE COMMITMENT AND SURVEY.
a. Attached hereto as Exhibit D is a title commitment with an
effective date of July 26, 1996 ("Title Commitment") for an owner's standard
coverage title insurance policy ("Title Policy") issued by First American Title
Insurance Company ("Title Insurer"). The owner's Title Policy issued at
Closing will be an ALTA policy in the amount of the Purchase Price subject only
to real estate taxes not yet due and payable, the general printed exceptions
set forth in Schedule B-Section 2 (Part I) as Numbers 7, 8 and 9 and the
special title exceptions set forth in Schedule B-Section 2 (Part II) Numbers 4
through 18, 24, 27 and 28 (modified as to tenants only, as shown on the rent
roll) of the Title Commitment. All of the above are herein referred to as the
"Permitted Exceptions". The Title Commitment shall be conclusive evidence of
good title as therein shown as to all matters insured by the policy, subject
only to the exceptions therein stated. On the Closing Date, Seller shall cause
the Title Insurer to issue the Title Policy or a "marked up" commitment in
conformity with the Title Commitment. Purchaser and Seller shall equally share
the costs of the Title Policy (which includes the cost of "extended coverage");
however, Purchaser shall pay the costs of any special endorsements which
Purchaser requires.
b. Purchaser acknowledges receipt of a survey ("Survey") of the
Property prepared by SEA Incorporated and dated January 25, 1996. Prior to the
Closing, Seller will have the Survey re-certified to the Purchaser, Purchaser's
lender, if any, and the Title Insurer in accordance with the requirements of
Purchaser's lender. However, if Purchaser requires any additional survey work,
Purchaser shall pay for the cost of such additional work.
4. CONDITION OF TITLE/CONVEYANCE. Seller agrees to convey fee simple
title to the Property by Grant, Bargain, Sale Deed ("Deed") in recordable form
subject only to the Permitted Exceptions. If Seller is unable to convey title
to the Property subject only to the Permitted Exceptions because of the
existence of an additional title exception or matter shown on the Survey (each,
an "Unpermitted Exception"), then Purchaser can elect to take title to the
Property subject to the Unpermitted Exception or terminate this Agreement;
provided, however, that if such Unpermitted Exceptions or matters are not
removed by the Closing Date, Purchaser may elect, upon written notice on or
prior to such date, to (a) discharge any Unpermitted Exceptions or matters
which can be discharged by the payment of money or the posting of security and
deduct from the cash portion of the Purchase Price the amount necessary to do
so (except to the extent that such discharged exceptions do not secure an
obligation to pay money, in which case Purchaser shall be able to deduct from
the Purchase Price not more than $50,000 in the aggregate with respect to such
exceptions), (b) extend the Closing Date to allow Seller a reasonable period of
time to remove such objected to exceptions or matters to the extent that Seller
is diligently working to cure or discharge such exceptions, or (c) proceed to a
timely Closing whereupon such objected to exceptions or matters shall be deemed
to be Permitted Exceptions. Notwithstanding anything to the contrary contained
herein, Seller shall discharge and remove any and all liens affecting the
Property (by payment of monies or the posting of security) which secure an
obligation to pay money (other than installments of real estate taxes not due
and payable as of the Closing) and, even though Purchaser does not expressly
disapprove such liens, such liens shall not be Permitted Exceptions. Prior to
Closing, Seller shall not take any action or commit or suffer any acts which
would give rise to a variance from the current legal description of the Real
Property, or cause the creation of any exception or encumbrance against or
respecting the Real Property without the prior written consent of Purchaser,
which consent may be withheld in Purchaser's sole and absolute discretion.
5. PAYMENT OF CLOSING COSTS. Purchaser and Seller shall equally share
the costs of the documentary stamps (if any) to be paid with reference to the
Deed and all other stamps, intangible, documentary, recording, sales tax and
surtax imposed by law with reference to any other documents delivered in
connection with this Agreement.
6. DAMAGE, CASUALTY AND CONDEMNATION.
a. If the Property suffers damage as a result of any casualty prior
to the Closing Date and can be repaired or restored in the case of real
property for $250,000.00 or less, or in the case of Personal Property, for
$25,000.00 or less, then Seller shall commence the repair or restoration in an
expeditious manner, in which event the Closing Date will be extended until such
date as may reasonably be required to complete the repair or restoration to the
reasonable satisfaction of Purchaser. Seller shall retain all insurance
proceeds. If the cost of repair or restoration exceeds that amount, then
Seller can elect to either: (a) repair and restore same, in which event the
Closing Date will be extended until such date as may reasonably be required to
complete the repair or restoration to the reasonable satisfaction of Purchaser;
or (b) terminate this Agreement upon notice to Purchaser served within
twenty (20) business days of such casualty. If Seller elects to terminate this
Agreement pursuant to this Paragraph, then Purchaser will have the option to
accept the Property in its damaged condition together with an assignment from
Seller of all insurance proceeds and receive a credit at Closing in the amount
of the deductible, provided Purchaser notifies Seller by notice served within
twenty (20) days after receipt of Seller's notice of election to terminate.
b. If condemnation proceedings ("Proceedings") are instituted
against the Property and the parties reasonably believe that such Proceedings
will result in an award in excess of $100,000.00, then Purchaser can elect to
either take the Property subject to the Proceedings and an assignment of
Seller's interest in the Proceedings or terminate this Agreement. If Purchaser
elects to terminate this Agreement, it shall be by notice to the Seller within
five (5) days after Seller notifies Purchaser of the Proceedings.
7. AS-IS CONDITION.
a. Purchaser acknowledges and agrees that it will be purchasing the
Property based solely upon its inspection and investigations of the Property
and that Purchaser will be purchasing the Property "AS IS" and "WITH ALL
FAULTS" based upon the condition of the Property as of the date of this
Agreement, subject to reasonable wear and tear. Without limiting the
foregoing, Purchaser acknowledges that, except as may otherwise be specifically
set forth elsewhere in this Agreement, neither Seller nor its consultants,
brokers or agents have made any other representations or warranties of any kind
upon which Purchaser is relying as to any matters concerning the Property,
including, but not limited to, the condition of the land or any improvements,
the existence or nonexistence of asbestos, lead in water, lead in paint, radon,
underground or above ground storage tanks, petroleum, toxic waste or any
Hazardous Materials or Hazardous Substances (as such terms are defined below),
the tenants of the Property or the leases affecting the Property, economic
projections or market studies concerning the Property, any development rights,
taxes, bonds, covenants, conditions and restrictions affecting the Property,
water or water rights, topography, drainage, soil, subsoil of the Property, the
utilities serving the Property or any zoning, environmental or building laws,
rules or regulations affecting the Property. Seller makes no representation
that the Property complies with Title III of the Americans With Disabilities
Act or any fire codes or building codes. Purchaser hereby releases Seller from
any and all liability in connection with any claims which Purchaser may have
against Seller, and Purchaser hereby agrees not to assert any claims, for
damage, loss, compensation, contribution, cost recovery or otherwise, against
Seller, whether in tort, contract, or otherwise, relating directly or
indirectly to the existence of asbestos or Hazardous Materials or Hazardous
Substances on, or environmental conditions of, the Property, or arising under
the Environmental Laws (as such term is hereinafter defined), or relating in
any way to the quality of the indoor or outdoor environment at the Property.
This release shall survive the Closing. As used herein, the term "Hazardous
Materials" or "Hazardous Substances" means (i) hazardous wastes, hazardous
materials, hazardous substances, hazardous constituents, toxic substances or
related materials, whether solids, liquids or gases, including but not limited
to substances defined as "hazardous wastes," "hazardous materials," "hazardous
substances," "toxic substances," "pollutants," "contaminants," "radioactive
materials," or other similar designations in, or otherwise subject to
regulation under, the Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended ("CERCLA"), 42 U.S.C. Section 9601 et seq.;
the Toxic Substance Control Act ("TSCA"), 15 U.S.C. Section 2601 et seq.; the
Hazardous Materials Transportation Act, 49 U.S.C. Section 1802; the Emergency
Planning and Community Right-to-Know Act, 42 U.S.C. Section 1101 et seq.; the
Atomic Energy Act ("AEA"), 42 U.S.C. Section 2011 et seq.; the Resource
Conservation and Recovery Act ("RCRA"), 42 U.S.C. Section 9601, et seq.; the
Clean Water Act ("CWA"), 33 U.S.C. Se 1251 et seq.; the Safe Drinking Water
Act, 42 U.S.C. Section 300f et seq.; the Clean Air Act ("CAA"), 42 U.S.C.
Section 7401 et seq.; and in any permits, licenses, approvals, plans, rules,
regulations or ordinances adopted, or other criteria and guidelines promulgated
pursuant to the preceding laws or other similar federal, state or local laws,
regulations, rules or ordinance now or hereafter in effect relating to
environmental matters (collectively the "Environmental Laws"); and (ii) any
other substances, constituents or wastes subject to any applicable federal,
state or local law, regulation or ordinance, including any Environmental Law,
now or hereafter in effect, including but not limited to (A) petroleum,
(B) refined petroleum products, (C) waste oil, (D) waste aviation or motor
vehicle fuel, (E) asbestos, (F) lead in water, paint or elsewhere, (G) radon,
(H) Polychlorinated Biphenyls (PCB's) and (I) ureaformaldehyde.
b. Seller has provided to Purchaser certain unaudited historical
financial information regarding the Property relating to certain periods of
time in which Seller owned the Property. Seller and Purchaser hereby
acknowledge that such information has been provided to Purchaser at Purchaser's
request solely as illustrative material. Seller makes no representation or
warranty that such material is complete or accurate or that Purchaser will
achieve similar financial or other results with respect to the operations of
the Property, it being acknowledged by Purchaser that Seller's operation of the
Property and allocations of revenues or expenses may be vastly different than
Purchaser may be able to attain. Purchaser acknowledges that it is a
sophisticated and experienced purchaser of real estate and further that
Purchaser has relied upon its own investigation and inquiry with respect to the
operation of the Property and releases Seller from any liability with respect
to such historical information.
8. CLOSING. The closing ("Closing") of this transaction shall be on
November 18, 1996 ("Closing Date"), at the office of the Title Insurer, at
which time Seller shall deliver possession of the Property to Purchaser.
9. CONDITIONS PRECEDENT TO PURCHASER'S OBLIGATIONS TO CLOSE.
Purchaser's obligation to consummate the transactions contemplated by this
Agreement and to render performance hereunder will, at the option of Purchaser,
be subject to the following conditions precedent, which conditions may be
waived by Purchaser only in a writing executed by Purchaser:
a. Property Questionnaire. On or before the Approval Date,
Purchaser shall have received a fully completed and signed Property
Questionnaire from the property manager or other responsible person familiar
with the details of the Property and its operation.
b. Transfer of Control. On or before the Closing Date, at Seller's
sole cost and expense, Seller shall, to the reasonable satisfaction of
Purchaser and in compliance with all applicable laws and the Declaration of
Covenants, Conditions and Restrictions, have transferred to Purchaser complete
control of all voting rights, boards and committees of the Westwood Point
Condominium Association (the "Association") established pursuant to the
Declaration of Covenants, Conditions and Restrictions.
c. Title. On the Closing Date, Title Insurer shall be irrevocably
committed to issue the Title Policy to Purchaser.
d. Seller's Due Performance. All of the representations and
warranties of Seller set forth in Paragraph below shall be true and correct as
of the Closing Date, and Seller, on or prior to the Closing Date, shall have
complied with and/or performed all of the obligations, covenants and agreements
required on the part of Seller to be complied with or performed pursuant to the
terms of this Agreement.
e. Physical Condition of Property. Subject to the provisions of
Paragraph , the physical condition of the Property shall be substantially the
same on the Closing Date as on the date of the execution of this Agreement,
except for reasonable wear and tear and any damages due to any act of Purchaser
or Purchaser's representatives.
f. Bankruptcy. No action or proceeding shall have been commenced
by or against Seller under the federal bankruptcy code or any state law for the
relief of debtors or for the enforcement of the rights of creditors and no
attachment, execution lien or levy shall have attached to or been issued with
respect to the Property or any portion thereof.
10. CLOSING DOCUMENTS.
a. On the Closing Date, Purchaser shall deliver to Seller an
executed closing statement, the balance of the Purchase Price, and such other
documents as may be reasonably required in order to consummate the transaction
as set forth in this Agreement.
b. On the Closing Date, Seller shall deliver to Purchaser
possession of the Property; the Deed (in the form of Exhibit E attached hereto)
subject to the Permitted Exceptions and those Unpermitted Exceptions waived by
Purchaser; an inventory of the Personal Property and a Bill of Sale for the
same (in the form of Exhibit F attached hereto); an executed closing statement;
an executed assignment and assumption of all service contracts (in the form of
Exhibit G attached hereto); an executed assignment and assumption of all leases
and security deposits (in the form of Exhibit H attached hereto); updated rent
roll; a notice to the tenants of the transfer of title and the assumption by
Purchaser of the landlord's obligations under the leases and the obligation to
refund the security deposits (in the form of Exhibit I attached hereto); a
non-foreign affidavit (in the form of Exhibit J attached hereto); an executed
assignment of intangibles (in the form of Exhibit K attached hereto); an
executed assignment of guarantees and warranties (in the form of Exhibit L
attached hereto); and such other documents as may be reasonably required by the
Title Insurer in order to consummate the transaction as set forth in this
Agreement.
11. DEFAULT BY PURCHASER. ALL EARNEST MONEY DEPOSITED INTO THE ESCROW IS
TO SECURE THE TIMELY PERFORMANCE BY PURCHASER OF ITS OBLIGATIONS AND
UNDERTAKINGS UNDER THIS AGREEMENT. IN THE EVENT THIS SALE IS NOT COMPLETED
BECAUSE OF PURCHASER'S DEFAULT, SELLER SHALL RETAIN ALL OF THE EARNEST MONEY
AND THE INTEREST THEREON AS SELLER'S SOLE RIGHT TO DAMAGES OR ANY OTHER REMEDY.
THE PARTIES HAVE AGREED THAT SELLER'S ACTUAL DAMAGES, IN THE EVENT OF A DEFAULT
BY PURCHASER, WOULD BE EXTREMELY DIFFICULT OR IMPRACTICAL TO DETERMINE.
THEREFORE, BY PLACING THEIR INITIALS BELOW, THE PARTIES ACKNOWLEDGE THAT THE
EARNEST MONEY HAS BEEN AGREED UPON, AFTER NEGOTIATION, AS THE PARTIES'
REASONABLE ESTIMATE OF SELLER'S DAMAGES.
12. SELLER'S DEFAULT. IF THIS SALE IS NOT COMPLETED BECAUSE OF SELLER'S
DEFAULT, PURCHASER'S SOLE REMEDY SHALL BE THE RIGHT TO RECOVER LIQUIDATED
DAMAGES IN THE AMOUNT OF $344,729.00 PLUS THE RETURN OF ALL EARNEST MONEY
TOGETHER WITH ANY INTEREST ACCRUED THEREON, AND THIS AGREEMENT SHALL TERMINATE
AND THE PARTIES SHALL HAVE NO FURTHER LIABILITY TO EACH OTHER AT LAW OR IN
EQUITY. THE PARTIES HAVE AGREED THAT PURCHASER'S ACTUAL DAMAGE IN THE EVENT OF
A DEFAULT BY SELLER WOULD BE EXTREMELY DIFFICULT OR IMPRACTICAL TO DETERMINE.
THEREFORE, BY PLACING THEIR INITIALS BELOW, THE PARTIES ACKNOWLEDGE THAT THE
LIQUIDATED DAMAGES IN THE AMOUNT OF $344,729.00 PLUS THE RETURN OF ALL EARNEST
MONEY HAS BEEN AGREED UPON, AFTER NEGOTIATION, AS THE PARTIES' REASONABLE
ESTIMATE OF PURCHASER'S DAMAGES. NOTWITHSTANDING ANYTHING CONTAINED HEREIN TO
THE CONTRARY, IF SELLER'S DEFAULT IS ITS REFUSAL TO DELIVER THE DEED OR THE
OTHER DOCUMENTS REQUIRED TO BE DELIVERED ON THE CLOSING DATE, THEN PURCHASER
WILL BE ENTITLED TO SUE FOR SPECIFIC PERFORMANCE, PROVIDED THAT AT THE TIME OF
THE FILING OF THE COMPLAINT, PURCHASER SHALL DEPOSIT WITH THE ESCROW AGENT THE
AMOUNT OF THE PURCHASE PRICE INCLUSIVE OF THE EARNEST MONEY.
13. a. PRORATIONS. Rents (exclusive of delinquent rents, but including
prepaid rents); water and other utility charges; fuels; prepaid operating
expenses; prepaid Service Contract payments; management fees in the amount of
5% of collections for the month in which the Closing occurs; real and personal
property taxes; and other similar items shall be adjusted ratably as of
12:01 A.M. on the Closing Date ("Proration Date"), and credited or debited to
the balance of the cash due at Closing. Refundable security deposits will be
assigned to and assumed by Purchaser and credited to Purchaser at Closing. If
for any reason the Proration Date is earlier than the Closing Date, then for
the period from the Proration Date through the Closing Date, Purchaser shall be
entitled to the benefit of all of the income from the Property and shall bear
the burden of all of the operating expenses of the Property, including, but not
limited to, insurance, service contracts, employee wages and benefits,
management fees, utility costs and interest on the existing mortgages
encumbering the Property (if any). If the amount of any of the items to be
prorated is not then ascertainable, the adjustment thereof shall be on the
basis of the most recent ascertainable data. All prorations will be final
except as to Delinquent Rents referred to in b below. If special assessments
have been levied against the Property for completed improvements, then the
amount of any installments which are due prior to the Closing Date shall be
paid by the Seller; and the amount of installments which are due after the
Closing Date shall be paid by the Purchaser. All assessments for incomplete
improvements shall be paid by Purchaser.
b. DELINQUENT RENTS. If, as of the Closing Date, any rent is in
arrears ("Delinquent Rent") for the calendar month in which the Closing occurs,
then the first rent collected by Purchaser will be delivered to Seller for the
Delinquent Rent to the extent attributable to the period prior to the Closing
Date. If Delinquent Rent is in arrears for a period prior to the calendar
month in which the Closing occurs, then rents collected by Purchaser shall
first be applied to current rent and then to Delinquent Rent. Purchaser shall
deliver Seller's pro rata share within 10 days of Purchaser's receipt of that
Delinquent Rent. This subparagraph of this Agreement shall survive the Closing
and the delivery and recording of the Deed.
14. RECORDING. This Agreement shall not be recorded and the act of
recording by Purchaser shall be an act of default hereunder by Purchaser and
shall be subject to the provisions of Paragraph .
15. ASSIGNMENT. The Purchaser shall not have the right to assign its
interest in this Agreement without the prior written consent of the Seller.
Any assignment or transfer of, or attempt to assign or transfer, Purchaser's
interest in this Agreement shall be an act of default hereunder by Purchaser
and subject to the provisions of Paragraph . Seller hereby consents to an
assignment to an entity, the ownership and control of which is held by the same
persons owning and controlling Purchaser, provided such assignment is effected
no later than ten (10) days prior to the Closing Date. However, Purchaser
shall remain liable for all of the Purchaser's obligations and undertakings set
forth in this Agreement and the exhibits attached hereto.
16. BROKER. The parties hereto acknowledge that CB Commercial Real
Estate Group, Inc. ("Broker") is the only real estate broker involved in this
transaction. Seller agrees to pay Broker a commission or fee ("Fee") pursuant
to a listing agreement between Seller and Broker. However, this Fee is due and
payable only from the proceeds of the Purchase Price received by Seller.
Purchaser agrees to indemnify, defend and hold harmless the Seller and any
partner, affiliate, parent of Seller, and all shareholders, employees, officers
and directors of Seller or Seller's partner, parent or affiliate (each of the
above is individually referred to as a "Seller Indemnitee") from all claims,
including attorneys' fees and costs incurred by a Seller Indemnitee as a result
of anyone's claiming by or through Purchaser any fee, commission or
compensation on account of this Agreement, its negotiation or the sale hereby
contemplated. Purchaser does now and shall at all times consent to a Seller
Indemnitee's selection of defense counsel. Seller agrees to indemnify, defend
and hold harmless the Purchaser and all shareholders, employees, officers and
directors of Purchaser or Purchaser's parent or affiliate (each of the above is
individually referred to as a "Purchaser Indemnitee") from all claims,
including attorneys' fees and costs incurred by a Purchaser Indemnitee as a
result of anyone's claiming by or through Seller any fee, commission or
compensation on account of this Agreement, its negotiation or the sale hereby
contemplated. Seller does now and shall at all times consent to a Purchaser
Indemnitee's selection of defense counsel.
17. DOCUMENTS, INSPECTION OF PROPERTY AND APPROVAL PERIOD.
a. Seller has delivered to Purchaser copies of the most recent
available tax bills, rent rolls, insurance premiums, and service contracts
(collectively the "Documents"). All of the Documents and the condition of the
Property shall be subject to approval by Purchaser, in its sole and absolute
discretion and for any reason or no reason whatsoever, by the close of business
(5:00 P.M. Central Time) on October 17, 1996 ("Approval Period"). During the
Approval Period, upon reasonable notice to the Seller, the Purchaser shall have
the right to inspect and approve the condition of the Property including the
interior of the apartments, during normal business hours. Purchaser, its
engineers, architects, employees, contractors and agents shall maintain public
liability insurance policies insuring against claims arising as a result of the
inspections of the Property being conducted by Purchaser. Prior to commencing
any tests, studies and investigations, Purchaser shall deliver to Seller a
certificate of insurance evidencing the existence of the aforesaid policies and
naming Seller as an additional insured. Purchaser agrees to indemnify, defend,
protect and hold Seller harmless from any and all loss, costs, including
attorneys' fees, liability or damages which Seller may incur or suffer as a
result of Purchaser's conducting its inspection and investigation of the
Property including the entry of Purchaser, its employees or agents and its
lender onto the Property, including without limitation, liability for
mechanics' lien claims resulting from Purchaser's inspection of the Property.
b. Purchaser agrees to defend and hold Seller harmless from any
injuries, damages or claims of any nature whatsoever which Purchaser's
servants, agents or employees may have as a result of Purchaser's inspection of
the Property. Purchaser further agrees to restore any damage to the Property
which may arise as a result of Purchaser's inspection of the Property.
c. If Purchaser fails to deliver the Earnest Money to the Escrow
Agent on or before the expiration of the Approval Period, then this Agreement
shall be deemed terminated.
d. If at any time prior to the Closing Date, Purchaser discovers
any fact or circumstance which would cause a representation or warranty of
Seller to be untrue or misleading, or with the passage of time would become
untrue or misleading and Purchaser fails to notify Seller of such fact or
circumstance, then Purchaser shall be deemed to have waived its right to seek
damages or termination of this Agreement.
18. SURVIVAL OF INDEMNITIES. Notwithstanding anything in this Agreement
to the contrary, the parties' obligations to indemnify, defend and hold each
other harmless under various provisions of this Agreement shall survive the
termination of this Agreement or the Closing and delivery and recording of the
Deed for a period of four (4) years.
19. TERMINATION OF AGREEMENT. If this Agreement is terminated by
Purchaser pursuant to any right of termination hereunder and Purchaser has
deposited the Earnest Money with the Escrow Agent, then upon such termination,
the Earnest Money plus all accrued interest shall be returned to the Purchaser.
20. SELLER'S REPRESENTATIONS, WARRANTIES AND COVENANTS.
a. Any reference herein to Seller's knowledge or to the best of
Seller's knowledge shall only mean such knowledge or notice that has actually
been received by Al Lieberman or Mark Van De Hey, the asset manager of the
Property. Any knowledge or notice given, had or received by any of Seller's
agents, servants or employees shall not be imputed to Seller or the individual
partners or the general partner of Seller.
b. Subject to the limitations set forth in subparagraph a above,
Seller hereby makes the following representations, warranties and covenants,
which shall survive the Closing and delivery of the Deed for a period of ninety
(90) days and the representations and warranties shall be deemed to have been
made as of the Closing Date:
i. To the best of Seller's knowledge, the present use and
occupancy of the Property conform with applicable building and zoning laws and
Seller has received no written notice that any such laws, rules or regulations
are being violated.
ii. To the best of Seller's knowledge, the rent roll ("Rent
Roll") attached hereto as Exhibit M which will be updated as of the Closing
Date is true and accurate and sets forth all apartment leases ("Tenant
Leases"). No rent has been prepaid more than 1 month in advance under any
Tenant Lease, except as set forth on Exhibit M-1 attached hereto.
iii. Seller has no knowledge of any pending or threatened
litigation, claim, cause of action or administrative proceeding concerning the
Property, except as set forth on Exhibit N attached hereto.
iv. Seller is a limited partnership, duly formed and validly
existing under the laws of the State of Illinois; and has the requisite power
and authority and all necessary governmental approvals to own, lease and
operate its properties and to carry on its business as it is now being
conducted.
v. Seller has all necessary power and authority to execute and
deliver this Agreement, to perform its obligations hereunder and to consummate
the transactions contemplated hereby. The execution and delivery of this
Agreement by Seller and the consummation by Seller of the transactions
contemplated hereby have been duly and validly authorized by all necessary
action and no other proceedings are necessary to authorize this Agreement or to
consummate the transactions contemplated hereby. This Agreement has been duly
and validly executed and delivered by Seller.
vi. The execution and delivery by Seller of this Agreement, the
consummation by Seller of the transactions contemplated hereby and compliance
by Seller with the provisions hereof will not (1) conflict with, result in a
breach of, cause a dissolution or require the consent or approval of any person
under any provision of the organizational documents of Seller, (2) require any
consent, approval, authorization or permit of any governmental authority, or
(3) violate or conflict with any judgment, order, writ, injunction or law
applicable to Seller.
c. Covenants.
i. Attached hereto as Exhibit O are copies of all licenses and
permits ("Licenses and Permits") affecting the Property which are in Seller's
possession. Attached hereto as Exhibit P is a list of all service contracts
("Service Contracts") affecting the Property (except for the property
management agreement which shall be terminated as of the Closing Date). After
the expiration of the Approval Period, Seller shall not enter into any new
service contracts which cannot be terminated with 30 days' notice or modify or
extend any existing Service Contracts without the prior consent of Purchaser,
which consent shall not be unreasonably withheld or delayed. Except as set
forth on Exhibits O and P, Seller has not received written notice that Seller
is in violation of or non-compliance with any Licenses or Permits or that
Seller is in default under any Service Contracts.
ii. The management, operation, leasing and maintenance of the
Property, as presently conducted by the Seller, shall continue until the
Closing Date.
iii. Seller shall deliver a copy of the representations and
warranties to the on-site manager of the Property and request the on-site
manager to reply in writing as to whether or not any of the representations or
warranties is false or misleading.
iv. For a period of ninety (90) days after the Closing, Seller
shall withhold from distribution to its partners the sum of $345,000.00 from
the net proceeds of the sale of the Property. If Seller violates this
covenant, then notwithstanding the provisions of Paragraph herein, the general
partner of Seller shall be personally liable for any claim that Purchaser may
assert during the ninety (90) day survival period for an amount not to exceed
$345,000.00.
d. If on or prior to the Closing Date, Seller discovers that a
representation or warranty is untrue, then upon receipt of notice from Seller,
Purchaser can elect to terminate this Agreement or take title to the Property
subject to the untrue representation or warranty.
21. ENVIRONMENTAL REPORTS. Attached to this Agreement as Exhibit Q are
the following reports (collectively "Environmental Reports") of the Property,
which Seller is delivering to Purchaser, at Purchaser's request:
a. Phase I Environmental Site Assessment dated October 16, 1995,
prepared by Western Technologies, Inc.;
b. Letters from Nevada Power Company dated October 13, 1995, and
October 26, 1995.
Seller makes no representation or warranty that the Environmental Reports are
accurate or complete. Purchaser hereby agrees not to assert any claim against
Seller for any liability whatsoever with respect to the Environmental Reports,
including, without limitation, the matters set forth in the Environmental
Reports or the accuracy and/or completeness of the Environmental Reports.
22. LIMITATION OF SELLER'S LIABILITY. No general or limited partner of
Seller, nor any of its respective beneficiaries, shareholders, partners,
officers, agents, employees, heirs, successors or assigns shall have any
personal liability of any kind or nature for or by reason of any matter or
thing whatsoever under, in connection with, arising out of or in any way
related to this Agreement and the transactions contemplated herein, and
Purchaser hereby waives for itself and anyone who may claim by, through or
under Purchaser any and all rights to sue or recover on account of any such
alleged personal liability.
23. PURCHASER'S ORGANIZATIONAL DOCUMENTS. At least ten (10) days prior
to the Closing Date, Purchaser will provide Seller's attorney with copies of
its organizational documents, including a certified copy of its recorded
certificate of limited partnership and a true copy of its Partnership Agreement
or a certified copy of its Articles of Incorporation, corporate resolutions
authorizing the transaction, and an incumbency certificate, whichever is
applicable.
24. TIME OF ESSENCE. Time is of the essence of this Agreement.
25. CROSS DEFAULT/OTHER AGREEMENTS. Simultaneously with the execution of
this Agreement, the Purchaser has entered into two other agreements ("Other
Agreements") with Westwood Pointe Associates and Westwood Investors to acquire
Westwood Pointe Apartments, Las Vegas, Nevada, and Somerset Pointe Apartments,
Las Vegas, Nevada, respectively. Each party hereto acknowledges that it would
not have entered into this Agreement if Purchaser and the sellers under the
Other Agreements had not executed the Other Agreements. A default by the
Purchaser under either of the Other Agreements shall be a default by Purchaser
under this Agreement. A default by a seller under either of the Other
Agreements shall be a default by Seller under this Agreement. If Purchaser
exercises its right of termination under this Agreement, then the Other
Agreements shall automatically be terminated without further action by either
party. In such event, unless this Agreement is terminated because of a default
by Purchaser, the Earnest Money plus the interest accrued thereon shall be
returned to Purchaser. If there is a termination of this Agreement and the
Other Agreements because of a default by a seller, then any cost recoverable by
Purchaser which was incurred for all of the properties shall be prorated among
all of them.
26. NOTICES. Any notice or demand which either party hereto is required
or may desire to give or deliver to or make upon the other party shall be in
writing and may be personally delivered or given or made by overnight courier
such as Federal Express or by facsimile or made by United States registered or
certified mail addressed as follows:
TO SELLER: c/o The Balcor Company
2355 Waukegan Road
Suite A200
Bannockburn, Illinois 60015
Attn: Ilona Adams
with copies to: The Balcor Company
2355 Waukegan Road
Suite A200
Bannockburn, Illinois 60015
Attn: Al Lieberman
847/267-1600
847/317-4462 (FAX)
and
Morton M. Poznak
Schwartz & Freeman
Suite 1900
401 North Michigan Avenue
Chicago, Illinois 60611
312/222-0800
312/222-0818 (FAX)
TO PURCHASER: Mr. Harry Alcock
AIMCO
1873 S. Bellaire - 7th Floor
Denver, Colorado 80222-4348
303/759-1110
303/753-9538 (FAX)
with copies to: Peter Kompaniez
AIMCO
28200 Highway 189
Suite F-240
Lake Arrowhead, California 92352
and
Audrey Sokoloff
Skaden, Arps
4 Embarcadero Center
Suite 3800
San Francisco, California 94111
415/984-2648
415/984-2698 (FAX)
subject to the right of either party to designate a different address for
itself by notice similarly given. Any notice or demand so given shall be
deemed to be delivered or made on the next business day if sent by overnight
courier, or on the same day if sent by facsimile before the close of business,
or the next day if sent by facsimile after the close of business, or on the 4th
business day after the same is deposited in the United States Mail as
registered or certified matter, addressed as above provided, with postage
thereon fully prepaid. Any such notice, demand or document not given,
delivered or made by registered or certified mail or by overnight courier or by
facsimile as aforesaid shall be deemed to be given, delivered or made upon
receipt of the same by the party to whom the same is to be given, delivered or
made. Copies of all notices shall be served upon the Escrow Agent.
27. EXECUTION OF AGREEMENT AND ESCROW AGREEMENT. Purchaser will execute
three (3) copies of this Agreement and three (3) copies of the Escrow Agreement
and forward them to Seller for execution. Seller will forward one (1) copy of
the executed Agreement to Purchaser and will forward the following to the
Escrow Agent:
a. One (1) fully executed copy of this Agreement; and
b. Three (3) copies of the Escrow Agreement signed by the parties
with a direction to execute two (2) copies of the Escrow Agreement and deliver
a fully executed copy to the Purchaser and the Seller.
28. GOVERNING LAW. The provision contained herein with reference to
retention of the Earnest Money in the event of Purchaser's default shall be
governed by the laws of the State of Illinois. The remaining provisions of
this Agreement shall be governed by the laws of the State of Nevada.
29. ENTIRE AGREEMENT. This Agreement constitutes the entire agreement
between the parties and supersedes all other negotiations, understandings and
representations made by and between the parties and the agents, servants and
employees.
30. COUNTERPARTS. This Agreement may be executed in multiple
counterparts, each of which shall be deemed an original but all of which shall
constitute one and the same instrument.
31. CAPTIONS. Paragraph titles or captions contained herein are inserted
as a matter of convenience and for reference, and in no way define, limit,
extend or describe the scope of this Agreement or any provision hereof.
IN WITNESS WHEREOF, the parties hereto have put their hand and seal as of
the date set forth above.
Executed by Purchaser on PURCHASER:
, 1996.
AIMCO PROPERTIES, L.P., a
Delaware limited partnership
By: AIMCO-GP, INC., a Delaware
corporation, its general partner
By: /s/Harry Alcock
----------------------------------
Executed by Seller on SELLER:
September 25, 1996.
SPRINGS POINTE INVESTORS, an Illinois limited
partnership
By: BALCOR PARTNERS-XIII, an Illinois general
partnership, a general partner
By: RGF-BALCOR ASSOCIATES-II, an Illinois
general partnership, a partner
By: THE BALCOR COMPANY, a Delaware corporation,
a partner
By: /s/James E. Mendelson
----------------------------------
James E. Mendelson
Authorized Representative
Springs Pointe
CB Commercial Real Estate Group ("Broker") executes this Agreement in its
capacity as a real estate broker and acknowledges that the fee or commission
("Fee") due to it as a result of the transaction described in this Agreement is
the amount as set forth in the listing agreement between Broker and Seller.
Broker also acknowledges that payment of the aforesaid Fee is conditioned upon
the Closing and the receipt of the Purchase Price by the Seller. Broker agrees
to deliver a receipt to the Seller at the Closing for the Fee and a release
stating that no other fees or commissions are due to Broker from Seller or
Purchaser.
CB COMMERCIAL REAL ESTATE GROUP
By: ___________________________________
EXHIBITS
A - Legal
B - Personal Property
C - Escrow Agreement
D - Title Commitment
E - Deed
F - Bill of Sale
G - Assignment of Service Contracts
H - Assignment of Leases and Security Deposits
I - Notice to Tenants
J - Non-Foreign Affidavit
K - Assignment of Intangibles
L - Assignment of Guarantees and Warranties
M - Rent Roll
M-1 - Prepaid Rent Schedule
N - Litigation
O - Licenses and Permits
P - Service Contracts
Q - Environmental Reports
Reference is made to the three (3) Agreements of Sale (individually an
"Agreement" and collectively "Agreements") between SPRINGS POINTE INVESTORS
("Springs"), WESTWOOD INVESTORS ("Somerset") and WESTWOOD POINTE ASSOCIATES
("Westwood") (individually a "Seller" and collectively, the "Sellers") and
AIMCO PROPERTIES, L.P., a Delaware limited partnership, the Purchaser, under
all of the Agreements, hereinafter referred to as the "Purchaser".
Each of the Agreements contains a cross-default provision and a provision
setting forth the amount of damages that the Purchaser can assert against a
Seller because of a default by the Seller.
If Westwood is in default under its Agreement thereby triggering a default
("Westwood Triggered Default") under the Somerset and Springs Agreements, then
Westwood shall reimburse Springs and Somerset for those sums that Springs and
Somerset will have to pay to the Purchaser because of the Westwood Triggered
Default.
If Somerset or Springs is in default under its Agreement, thereby triggering a
default ("Balcor Triggered Default") under the Westwood Agreement, then
Somerset and Springs shall reimburse Westwood for those sums that Westwood will
have to pay to the Purchaser because of the Balcor Triggered Default.
WESTWOOD INVESTORS, an Illinois limited
partnership
By: BALCOR PARTNERS-XV, an Illinois
general partnership, a general partner
By: RGF-BALCOR ASSOCIATES-II, an Illinois
general partnership, a partner
By: THE BALCOR COMPANY, a Delaware
corporation, a partner
By: /s/ James E. Mendelson
----------------------------
James E. Mendelson
Authorized Representative
SPRINGS POINTE INVESTORS, an Illinois
limited partnership
By: BALCOR PARTNERS-XIII, an Illinois
general partnership, a general partner
By: RGF-BALCOR ASSOCIATES-II, an
Illinois general partnership, a partner
By: THE BALCOR COMPANY, a Delaware
corporation, a partner
By: /s/ James E. Mendelson
------------------------------
James E. Mendelson
Authorized Representative
WESTWOOD POINTE ASSOCIATES, an Illinois
limited partnership
By: Westwood Pointe, Inc., an Illinois
corporation, the general partner
By: /s/ Larry M. Chaness
------------------------------