PURCHASE AND SALE AGREEMENT
AND
SUPPLEMENTAL ESCROW INSTRUCTIONS
SELLER:
KDC-AZ, LLC,
A DELAWARE LIMITED LIABILITY COMPANY
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BUYER:
CAPITAL TITLE GROUP, INC.,
AN ARIZONA CORPORATION
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TABLE OF CONTENTS
PAGE
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1. Agreement............................................................ 1
2. The Property......................................................... 1
3. Purchase Price and Terms of Payment.................................. 2
4. Opening Date......................................................... 2
5. Close of Escrow...................................................... 3
6. ▇▇▇▇▇▇▇ Money........................................................ 3
7. INTENTIONALLY OMITTED................................................ 3
8. Title Insurance...................................................... 4
9. INTENTIONALLY OMITTED................................................ 4
10. Conveyance of Property............................................... 6
11. Maintenance of Property Prior to Closing............................. 6
12. Possession........................................................... 6
13. Seller's Representations and Warranties and
Condition of Property.............................................. 6
14. Closing Deliveries................................................... 8
(a) Seller's Deliveries............................................. 8
(b) Buyer's Deliveries.............................................. 9
(c) Post-Closing Deliveries......................................... 9
15. Prorations and Closing Costs......................................... 9
16. Defaults and Remedies................................................ 9
(a) Seller's Remedies............................................... 9
(b) Buyer's Remedies................................................ 10
17. Condemnation......................................................... 10
18. Commissions.......................................................... 10
19. Risk of Loss......................................................... 11
20. Assignment........................................................... 11
21. Notices.............................................................. 11
22. Merger............................................................... 12
TABLE OF CONTENTS (CONT'D)
PAGE
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23. Time of the Essence.................................................. 12
24. Further Documentation................................................ 12
25. Governing Law........................................................ 13
26. Severability......................................................... 13
27. Waivers.............................................................. 13
28. Attorneys' Fees...................................................... 13
29. Counterparts; Duplicate Originals.................................... 13
30. Time for Performance................................................. 13
31. Construction and Completion of Improvements . . . . . . 13
32. Construction Contract ............................................... 14
33. Letter of Credit .................................................... 14
34. Subsidiary .......................................................... 14
LIST OF EXHIBITS
Exhibit A - Legal Description
Exhibit B - Plans and Specifications
Exhibit C - Contracts and Agreements
Exhibit D - Tangible Personal Property
Exhibit E - Promissory Note
Exhibit F - Assignment of Tenant's Interest in Ground Lease
Exhibit G - ▇▇▇▇ of Sale
Exhibit H - Assignment and Assumption of Contracts
Exhibit I - Stock Subscription Contracts
Exhibit J - Contractor's Warranty
PURCHASE AND SALE AGREEMENT
AND
SUPPLEMENTAL ESCROW INSTRUCTIONS
PARTIES:
SELLER: KDC-AZ, LLC, an Arizona
limited partnership
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▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: President
Phone: 602/▇▇▇-▇▇▇▇
BUYER: CAPITAL TITLE GROUP, INC.,
an Arizona corporation
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Attn: ▇▇▇▇▇▇ ▇. Head, C.E.O.
Phone: 602/▇▇▇-▇▇▇▇
ESCROW CAPITAL TITLE INSURANCE COMPANY
AGENT: ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Phone: 602/▇▇▇-▇▇▇▇
Escrow Officer: ▇▇▇▇▇ ▇▇▇▇▇▇
Escrow No.:
1. AGREEMENT. Seller agrees to sell, and Buyer agrees to buy, the Property
(as defined below) on the terms and conditions set forth in the printed form
Escrow Instructions attached hereto and these Supplemental Escrow Instructions.
The printed form Escrow Instructions and these Supplemental Escrow Instructions
together constitute a binding and enforceable agreement (the "Agreement"). In
the event of a conflict between the provisions of the printed form Escrow
Instructions and these Supplemental Escrow Instructions, the provisions of these
Supplemental Escrow Instructions shall control. Paragraphs 12 and 13 of the
printed form Escrow Instructions are hereby deleted.
2. THE PROPERTY. The term "the Property" shall include the following:
(a) the Seller's interest in the ground lease (the "Ground Lease")
executed by and between ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ as Landlord, and Seller as Tenant, and
dated January 30, 1998, for the approximately thirty-two thousand six hundred
forty (32,640) square feet of unimproved real property located at ▇▇▇▇ ▇▇▇▇▇▇
and Camelback in Phoenix, Arizona (the "Property"), as legally described on
Exhibit A attached hereto, including all right, title and interest of the Seller
in and to any easements, covenants and other rights appurtenant to the Property,
and all right, title and interest of the Seller in and to any land lying in the
bed of any street, road, avenue or alley, open or closed, in front of or
adjoining the Property;
(b) a two (2) story office building containing approximately
twenty-four thousand 24,000 square feet of office space with two (2) floors of
underground parking to be constructed on the Property (the "Improvements"). The
Improvements will be constructed in accordance with plans and specifications to
be mutually agreed upon by Buyer and Seller and in compliance with the terms of
Exhibit B attached hereto;
(c) all right, title and interest of the Seller in and to the contracts
and agreements listed in Exhibit C attached hereto and made a part hereof;
(d) all personal property, furniture, furnishings, fixtures, equipment
and other tangible personal property owned by the Seller as listed in Exhibit D
attached hereto and made a part hereof;
(e) all warranties, licenses and other tangible property used in the
operation of the Improvements and the Land.
3. PURCHASE PRICE AND TERMS OF PAYMENT.
The purchase price of the Property shall be the sum of Four Million
Three Hundred Eight Thousand Eight Hundred Forty-Six Dollars ($4,308,846),
subject to adjustments to the budget for the cost of the Improvements as agreed
upon by Buyer and Seller and shall be paid as follows:
(a) An ▇▇▇▇▇▇▇ money deposit of Six Hundred Fifty-Eight Thousand Six
Hundred Forty-Six Dollars ($658,646) represented by Buyer's execution of a
promissory note ("Note") in the form attached as Exhibit E to Seller shall be
deposited with Escrow Agent upon execution of this Agreement by both Seller and
Buyer. Upon (A) Buyer's approval of (1) the Guaranteed Maximum Price
Construction Contract for the Improvements, (2) the Permanent Financing
Commitment, (3) a Construction Budget, and (4) the Interior Drawings and (B) the
funding of the Stock Subscription Contracts being executed contemporaneously
herewith and attached hereto as Exhibit I, the Note will be replaced by Buyer
with a like amount of cash that will be nonrefundable (except in the event of
Seller's default) and will be released from escrow to Seller to be used by
Seller as owner's funds for the construction loan. Buyer agrees to deliver to
Seller its approval or disapproval of (1) the Guaranteed Maximum Price
Construction Contract, (2) the Permanent Financing Commitment, (3) a
Construction Budget, and (4) the Interior Drawings, within ten (10) days after
its receipt of all such final documents. Buyer agrees that it shall not
unreasonably withhold its approval of such documents, and further agrees that if
such documents do not substantially differ in form from (1) the Guaranteed
Maximum Price Construction Contract, (2) the Permanent Financing Commitment, (3)
a Construction Budget, and (4) the Interior Drawings (the Loan Application for
the Permanent Financing Commitment and the Construction Budget have been
reviewed by Buyer), Buyer will not withhold its approval of such documents. If
Buyer disapproves of any of such items, then Seller shall have twenty (20) days
from the date of such written disapproval to cure such objections to Buyer's
satisfaction. If Seller is unable to cure such objections, then Buyer shall not
be obligated to replace the Promissory Note with cash, and this Agreement shall
terminate and be of no further force or effect.
(b) The balance of the purchase price shall be paid at Close of Escrow,
via cash, certified check or wired funds.
(c) In addition to the Purchase Price, Buyer will deliver to Seller, at
the Closing, twenty-five thousand (25,000) shares of the common stock of Buyer.
4. OPENING DATE. Escrow shall be deemed opened on the date (the "Opening
Date") when at least one (1) fully executed original of this Agreement has been
delivered to the Escrow Agent along with the "Note" representing the ▇▇▇▇▇▇▇
money deposit of Six Hundred Fifty-Eight Thousand, Eight Hundred Forty-Six
($658,846). Escrow Agent shall advise Buyer and Seller in writing of the Opening
Date.
5. CLOSE OF ESCROW. Close of Escrow shall occur immediately upon the
occurrence of both (a) the substantial completion of the Improvements, in
accordance with the final plans and specifications which have been approved by
both Buyer and Seller and (b) the funding of the Permanent Loan. At Close of
Escrow, conveyancing documents shall be recorded as provided in this Agreement.
Close of Escrow shall be held at the offices of Escrow Agent, unless a different
location is otherwise mutually agreed upon.
6. ▇▇▇▇▇▇▇ MONEY. The timely deposit of the Note representing the ▇▇▇▇▇▇▇
money and the replacement thereof referred to in this Agreement is an express
condition precedent to Seller's obligations under this Agreement. If Buyer fails
to timely replace the Note with a like amount of cash (unless Buyer is not so
obligated to do), then Buyer shall be deemed to be in default hereunder, the
Escrow Agent is hereby instructed to deliver the Note to Seller, and the Buyer
shall be fully liable to the Seller for full payment under the Note.
7. INTENTIONALLY DELETED.
8. TITLE INSURANCE.
(a) At Close of Escrow, Seller shall provide Buyer with an extended
coverage lessee's policy of title insurance issued by Escrow Agent or its
underwriters in the full amount of the sales price, effective as of the Close of
Escrow. The policy shall contain such endorsements as are reasonably required by
Buyer, but the incremental cost of the endorsements shall be the responsibility
of Buyer. Seller shall pay the premium which would have been charged for a
standard coverage lessee's policy, and the additional premium charge for the
extended coverage lessee's title insurance policy shall be borne by Buyer.
(b) The obligations of Seller to provide the title insurance called for
in this Paragraph shall be satisfied if, at the Close of Escrow, Escrow Agent
has given a binding commitment to issue the title insurance in the form required
by this Paragraph and if the actual policy is delivered within a reasonable time
following the Close of Escrow.
9. INTENTIONALLY DELETED.
10. CONVEYANCE OF PROPERTY.
(a) At Close of Escrow, Seller shall convey its leasehold interest to
the Property to Buyer by an Assignment of Tenant's interest in the Ground Lease,
in the form attached as Exhibit F, subject to the Ground Lease, current taxes
and assessments, reservations in patents, all easements, rights of way,
encumbrances, liens, covenants, conditions, restrictions, obligations,
liabilities and all other matters of record.
(b) At Close of Escrow, Seller shall transfer and assign to Buyer title
to the personal property owned by Seller and included within the definition of
"Property" by ▇▇▇▇ of sale, in the form attached as Exhibit G, without
representation or warranty as to title or the condition thereof.
(c) At Close of Escrow, Seller shall execute and deliver to Buyer an
Assignment and Assumption (without recourse or warranty) of the Service
Contracts, in the form attached as Exhibit H and Buyer shall, subject to the
limitations of the next sentence, expressly assume the Seller's obligations
under the Service Contracts. To the extent any Service Contract may be canceled
on or before Close of Escrow without liability to Seller, and Buyer gives notice
to Seller prior to the end of Buyer's Contingency Period that Buyer does not
wish to assume it (or them), Seller not assign any such Service Contract to
Buyer.
11. MAINTENANCE OF PROPERTY PRIOR TO CLOSING. Until the Close of Escrow,
Seller or Seller's agent shall keep the Property insured against fire and other
hazards covered by extended coverage endorsement and comprehensive public
liability insurance against claims for bodily injury, death and property damage
occurring in, on or about the Property.
12. POSSESSION. Possession of the Property shall be delivered to Buyer upon
the Close of Escrow.
13. SELLER'S REPRESENTATIONS AND WARRANTIES AND CONDITION OF PROPERTY.
(a) Seller is a Delaware limited liability company, duly organized,
validly existing and in good standing under the laws of the State of Arizona.
(b) Seller is authorized to perform its obligations under this
Agreement, and the execution of this Agreement will not violate any material
terms of Seller's Limited Partnership Agreement.
(c) There are no pending lawsuits or administrative proceedings
affecting the property or any portion thereof, nor does Seller have actual
knowledge of any such action as presently contemplated.
(d) There are no tenant leases or contracts or agreements, other than
those listed in Exhibit C which will remain in effect after the closing.
(e) No consent, approval, order or authorization of any person not a
party to this Agreement, and no consent, approval, declaration or filing of any
governmental authority on the part of Seller is required in connection with the
execution and delivery of this Agreement or the performance of the transactions
contemplated herein, except the consent of the Landlord under the Ground Lease.
(f) Seller has paid, or by the Closing Date will pay, all real property
taxes of every kind and nature imposed on the Property, except such property
taxes as shall be prorated between Buyer and Seller as of the Closing Date.
(g) Seller has no actual knowledge of any material defect or error in
any of the Property Documents delivered to Buyer nor of any other information
with respect to the Property which would materially and adversely affect the
development thereof.
(h) Seller represents and warrants that the Property is in compliance
with state, local and federal laws respecting accessibility or nondiscrimination
as to people with disabilities, including, but not limited to, the Americans
With Disabilities Act.
(i) Seller represents and warrants that the Property will be zoned to
allow construction and use of the Improvements.
(j) Buyer acknowledges that Buyer has fully investigated the Property
and all records and documents relating thereto to Buyer's satisfaction. Seller
is therefore released from all responsibility and liability regarding the
condition, valuation or utility of the Property. Buyer expressly acknowledges
that Buyer is buying the Property in an "as is" condition, and that Buyer has
not relied on any warranties, promises, understandings or representations,
express or implied, of Seller or any agent of Seller relating to the Property
which are not expressly contained in this Agreement. Buyer acknowledges that any
and all leasing information, feasibility or marketing reports, or other
information of any type which Buyer has received or may receive from Seller or
Seller's agents is or has been furnished on the express condition that Buyer
shall or would make an independent verification of the accuracy of any and all
such information, all such information being furnished without any warranty
whatsoever. Buyer agrees that Buyer will not attempt to assert any liability
against Seller for furnishing such information, and Buyer agrees to indemnify
and hold Seller free and harmless from any and all such claims of liability.
This indemnity shall survive the Close of Escrow or the termination of this
Agreement.
(k) EXCEPT AS OTHERWISE EXPRESSLY PROVIDED HEREIN, SELLER HEREBY
DISCLAIMS ALL WARRANTIES OF ANY KIND OR NATURE WHATSOEVER (INCLUDING WARRANTIES
OF HABITABILITY, MERCHANTABILITY AND FITNESS FOR PARTICULAR PURPOSE), WHETHER
EXPRESSED OR IMPLIED, INCLUDING BUT NOT LIMITED TO WARRANTIES WITH RESPECT TO
THE PROPERTY, THE ZONING OF THE LAND, THE SOIL CONDITIONS OF THE LAND, OR THE
SUITABILITY OF THE PROPERTY FOR BUYER'S INTENDED USE THEREOF. BUYER ACKNOWLEDGES
THAT BUYER WILL CONDUCT A DILIGENT INVESTIGATION OF THE PROPERTY WITH REGARD TO
ITS CONDITION, PROFITABILITY, PERMITTED USE, AND SUITABILITY FOR BUYER'S
INTENDED USE THEREOF, AS WELL AS ALL OTHER FACTORS DEEMED MATERIAL TO BUYER AND
WILL EMPLOY SUCH INDEPENDENT PROFESSIONALS IN CONNECTION THEREWITH AS DEEMED
NECESSARY BY BUYER. BUYER FURTHER ACKNOWLEDGES THAT BUYER IS PURCHASING THE
PROPERTY "AS IS" AND IN ITS PRESENT CONDITION AND THAT BUYER IS NOT RELYING UPON
ANY REPRESENTATION OF ANY KIND OR NATURE MADE BY SELLER, OR ANY OF ITS EMPLOYEES
OR AGENTS, WITH RESPECT TO THE PROPERTY, AND THAT, IN FACT, NO SUCH
REPRESENTATIONS WERE MADE.
(l) FURTHER, AND WITHOUT IN ANY WAY LIMITING ANY OTHER PROVISION OF
THIS AGREEMENT, SELLER MAKES NO WARRANTY WITH RESPECT TO THE PRESENCE ON OR
BENEATH THE PROPERTY (OR ANY PARCEL IN PROXIMITY THERETO) OF HAZARDOUS
SUBSTANCES OR MATERIALS WHICH ARE CATEGORIZED AS HAZARDOUS OR TOXIC UNDER ANY
LOCAL, STATE OR FEDERAL LAW, STATUTE, ORDINANCE, RULE, OR REGULATION PERTAINING
TO ENVIRONMENTAL OR SUBSTANCE REGULATION, CONTAMINATION, CLEANUP OR DISCLOSURE,
AND SHALL HAVE NO LIABILITY TO BUYER THEREFOR. BY ACCEPTANCE OF THIS AGREEMENT
AND THE DEED, BUYER ACKNOWLEDGES THAT BUYER'S OPPORTUNITY FOR INSPECTION AND
INVESTIGATION OF SUCH PROPERTY (AND OTHER PARCELS IN PROXIMITY THERETO) WILL BE
ADEQUATE TO ENABLE BUYER TO MAKE BUYER'S OWN DETERMINATION WITH RESPECT TO THE
PRESENCE ON OR BENEATH THE PROPERTY (AND OTHER PARCELS IN PROXIMITY THERETO) OF
SUCH HAZARDOUS SUBSTANCES OR MATERIALS.
(m) Notwithstanding the foregoing, Seller represents to Buyer that
Seller has disclosed to Buyer all material information it has concerning the
Property. Seller knows of no condition or event which is not disclosed to Buyer
which would have a material, adverse impact on the Property. Seller has not
failed to disclose any information to Buyer necessary to ensure that any
representation made herein is not in any way misleading.
14. CLOSING DELIVERIES.
(a) SELLER'S DELIVERIES. Seller shall deliver, at or before the
Closing, the following documents:
(1) An Assignment of Tenant's interest in the Ground Lease, in the
form attached hereto as Exhibit F.
(2) A ▇▇▇▇ of Sale to the personal property in the form attached
hereto as Exhibit G.
(3) The contracts described in Exhibit C.
(4) An assignment of contracts described on Exhibit C by way of an
Assignment and Assumption of Contracts in the form attached as Exhibit H.
(5) An Affidavit pursuant to the Foreign Investment in Real
Property Tax Act in the Escrow Agent's standard form.
(6) A partnership resolution authorizing Seller's consummation of
this transaction.
(7) Seller's certificate representing and warranting to Buyer that
the Improvements have been completed in accordance with the Construction Plans
set forth on Exhibit B.
(b) BUYER'S DELIVERIES. Buyer shall deliver, at or before the Closing,
the following:
(1) The purchase price.
(2) The Assignment and Assumption of Contracts.
(c) POST-CLOSING DELIVERIES. Subsequent to Closing, Seller shall
provide to Buyer copies of form letters to contractors, utility companies and
others serving the Property, advising them of the sale of the Property to Buyer
and directing to Buyer all bills for the services provided to the Property on
and after the Closing Date. Seller shall be entitled to the return of any
deposits posted by it with any such company.
15. PRORATIONS AND CLOSING COSTS.
(a) Seller and Buyer shall each pay one-half (1/2) of the escrow
charges. Real estate taxes, rents (i.e., tenant leases), contract payments,
irrigation assessments, improvement liens and utilities shall be prorated in the
escrow as of Close of Escrow, based on the latest information available to
Escrow Agent. On or before Close of Escrow, and as a condition thereof, Buyer
agrees to deposit with Escrow Agent cash in an amount sufficient to pay all
closing costs payable by Buyer. Any utility deposits shall be credited to
Seller, if not returned to Seller by the respective utility companies.
(b) Any other closing costs, including recording and filing fees, shall
be paid by Buyer and Seller according to the usual and customary practice in
Maricopa County, Arizona.
16. DEFAULTS AND REMEDIES.
(a) SELLER'S REMEDIES. If Buyer fails to consummate this transaction in
accordance with this Agreement for any reason other than a material default by
Seller, then Seller shall be entitled to seek any and all remedies available to
it, at law or in equity.
(b) BUYER'S REMEDIES. If Seller fails to consummate this transaction in
accordance with this Agreement for any reason other than a default by Buyer or a
termination of this Agreement permitted herein, then Buyer's exclusive remedies
shall be (i) to terminate this Agreement and recover from Escrow Agent, by
written request, the Note or (ii) instead, to waive such failure and seek
specific performance of the conveyance of the Property. Any action for specific
performance under the preceding clause (ii) must be commenced within forty-five
(45) days after the scheduled Close of Escrow hereunder. Except for delay
damages under Paragraph 31 accrued to the date of cancellation, Buyer shall have
no right to bring or maintain any action for monetary damages for any breach of
this Agreement by Seller, and Buyer hereby waives any and all rights to any such
cause of action. Buyer's right to recover the Note is subject to its prior
submission to Escrow Agent of an enforceable release, in recordable form, of any
and all rights that Buyer may have regarding Seller or the Property and this
Agreement, such release to be in form and substance reasonably acceptable to
Seller.
17. CONDEMNATION. In the event of any condemnation or conveyance in lieu of
condemnation of all or a material part of the Property subsequent to the end of
the Buyer's Contingency Period, Seller shall promptly notify Buyer and either
party shall have the option to terminate this Agreement on written notice to the
other on or before the date and time herein specified for the Close of Escrow.
If this Agreement is not so terminated by either party, Seller shall assign to
Buyer at the Close of Escrow, in lieu of conveyance of the Property, or such
part of the Property as is the subject of such condemnation or conveyance in
lieu of condemnation, Seller's right, title and interest, if any, to receive the
condemnation proceeds or proceeds for sale in lieu of condemnation payable in
connection with such taking or sale. In such event, Seller shall also deliver to
Buyer at the Close of Escrow any condemnation proceeds or proceeds from a sale
in lieu of condemnation which may have been received by Seller prior to the
Close of Escrow.
18. COMMISSIONS. If, and only if, this transaction closes, Seller agrees to
pay a commission (pursuant to separate agreement) to ▇▇▇ & Associates. Buyer and
Seller each warrant and represent that no other finder's fee, brokerage
commission or other compensation shall be due in connection with this
transaction. If any other person shall assert a claim to a finder's fee,
brokerage commission, or other compensation on account of alleged employment as
a finder or broker in connection with this transaction, the party under whom (or
by whose acts) the finder or broker is claiming shall indemnify and hold the
other party harmless from and against any such claim and all costs, expenses and
liabilities incurred in connection with such claim or any action or proceeding
brought on such claim, including but not limited to, attorneys' fees and court
costs in defending against such claim. This indemnity shall survive the Close of
Escrow or the termination of this Agreement. If this transaction does not close,
no commission or any part of the ▇▇▇▇▇▇▇ money shall be due under any
circumstances.
19. RISK OF LOSS. During the pendency of the escrow, the risk of loss or
destruction of the Property shall be Seller's.
20. ASSIGNMENT. Buyer shall have the right to assign its interest in this
Agreement, subject to Seller's prior written consent, and further subject to
Seller's participation in one hundred percent (100%) of the profits derived from
Buyer as a result of the assignment; provided, however, that Seller shall not
participate in any of the profits if Buyer assigns its rights in this Agreement
to Buyer's parent company, if any, to a company which Buyer owns, or to a
company which is a subsidiary of Buyer's parent company, if any.
21. NOTICES. All notices or other communications required or provided to be
sent by either party or Escrow Agent shall be in writing, shall be delivered by
one or more of the following methods and shall be effective as indicated below:
(a) By hand-delivery, in which event notice is deemed to be effective
on the date that notice is received; or
(b) by United States Postal Service certified or registered mail,
postage prepaid, in which event notice is deemed to be effective on the date
which is three (3) days after the date on which notice is mailed; or
(c) by overnight delivery by a commercial entity which is in the
business of providing overnight delivery service (fees prepaid) or by overnight
United States Postal Service delivery (fees prepaid), in which event notice is
deemed to be effective on the date following the date on which notice is
properly deposited with such commercial entity or with the United States Postal
Service; or
(d) by electronic facsimile process, in which event notice is deemed to
be effective on the date of electronic transmission properly made (if
transmission is made before 12:00 o'clock noon, sender's time), or on the next
day after the date of electronic transmission properly made (if transmission is
made after 12:00 o'clock noon, sender's time).
Notices shall be sent to the addresses shown below or at such other address or
addresses (but neither party may designate a post office box for receipt of
notices) as the parties or Escrow Agent may, from time to time, specify in
writing, such changes to be made in a like manner:
To Buyer: CAPITAL TITLE GROUP, INC.
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇ ▇▇., ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇
Attn: Don R. Head
FAX: 602/▇▇▇-▇▇▇▇
With a copy to: ▇▇▇▇ ▇. Head
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
FAX: 602/▇▇▇-▇▇▇▇
To Seller: KDC-AZ, LLC
▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ ▇▇., ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: President
FAX: 602/▇▇▇-▇▇▇▇
With a copy to: ▇▇▇▇ DEVELOPMENT COMPANY, LLC
▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: President
FAX: 714/▇▇▇-▇▇▇▇
With a copy to: SACKS TIERNEY P.A.
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇-▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
FAX: 602/▇▇▇-▇▇▇▇
22. MERGER. This Agreement, together with Exhibits A through J, constitutes
the entire agreement between the parties pertaining to the subject matter
contained in this Agreement. All prior and contemporaneous agreements,
representations and understandings, written or oral, are superseded by and
merged into this Agreement. No supplement, modification or amendment of this
Agreement shall be binding unless in writing and executed by Buyer and Seller.
23. TIME OF THE ESSENCE. With regard to all of the provisions contained in
this Agreement, time is of the essence.
24. FURTHER DOCUMENTATION. Each party agrees in good faith to execute such
further or additional documents as may be necessary or appropriate to fully
carry out the intent and purpose of this Agreement.
25. GOVERNING LAW. This Agreement shall be governed by, and construed in
accordance with, the laws of the State of Arizona.
26. SEVERABILITY. In the event one or more of the provisions contained in
this Agreement shall for any reason be held to be invalid, illegal or
unenforceable in any respect, such invalidity, illegality or unenforceability
shall not affect any other provision herein, and this Agreement shall be
construed as if such invalid, illegal or unenforceable provision had never been
contained herein.
27. WAIVERS. The waiver by any party hereto of any right granted to it
hereunder shall not be deemed to be a waiver of any other right granted herein,
nor shall same be deemed to be a waiver of a subsequent right obtained by reason
of the continuation of any matter previously waived.
28. ATTORNEYS' FEES. The prevailing party in any litigation, arbitration or
other proceedings arising out of this Agreement shall be reimbursed by the other
party for all costs and expenses incurred in such proceedings, including
reasonable attorneys' fees.
29. COUNTERPARTS; DUPLICATE ORIGINALS. This Agreement may be executed in
multiple counterparts and when a counterpart has been executed by each of the
parties hereto such counterparts, taken together, shall constitute a single
agreement. Duplicate originals may also be utilized, each of which shall be
deemed an original document.
30. TIME FOR PERFORMANCE. The time for performance of any obligation or any
other action under this Agreement shall be deemed to expire at 4:00 p.m.,
Mountain Standard Time, on the last day of the applicable time period provided
for herein. However, if the time for the performance of any obligation or other
action under this Agreement expires on a Saturday, Sunday or legal holiday, the
time for performance shall be extended to the next succeeding day which is not a
Saturday, Sunday or legal holiday.
31. CONSTRUCTION AND COMPLETION OF IMPROVEMENTS. Seller shall deliver the
Improvements to Buyer so that Buyer may occupy and utilize the Improvements on
or before August 1, 1999. If Seller fails to so deliver the Improvements to
Buyer on or before August 1, 1999, Seller agrees to be responsible for all
additional costs and expenses which Buyer incurs as a result of Seller's failure
to timely deliver the Improvements, which costs and expenses will not include
Buyer's Rent at the normal charge and rate. Seller agrees that if it is unable
to deliver the Improvements to Buyer on or before December 1, 1999, Buyer shall
have the right to terminate this Agreement. Seller agrees that Buyer may inspect
the Improvements during the course of construction at anytime Buyer requests, on
twenty-four hours prior notice to Seller. Seller agrees to cause all
construction and other warranties it receives from the subcontractors who will
construct the Improvements to be assigned to Buyer. The General Contractor's
Warranty will be in the form attached as Exhibit J. The parties agree that the
dates set forth herein will be extended during any period in which Seller is
unable to continue construction due to "FORCE MAJEURE" items, or to destruction
of the Improvements by fire or otherwise, or delays caused by Buyer. Seller
warrants that Contractor's Warranty will be enforceable by Buyer and not subject
to any defenses at law or equity (unless Buyer, through its action or inaction,
causes the Warranty to be unenforceable or the defenses to be unavailable).
Seller indemnifies and holds Buyer harmless from any loss due to breach of
Seller's Warranty in this Paragraph.
32. CONSTRUCTION CONTRACT. Seller agrees to execute a "not to exceed"
contract for the construction of the Improvements with a general contractor,
subject to the approval of Buyer as set forth in Paragraph 3.(a). Seller agrees
to credit Buyer at the Closing with the amount by which the actual construction
costs are less than the costs set forth in the Construction Contract. No change
orders will be made to the Construction Contract unless agreed to, in writing,
by Seller, Buyer and the general contractor.
33. LETTER OF CREDIT. Buyer agrees that in order to assume a permanent loan
for the Improvements, a letter of credit has been required by the Lender. Buyer
agrees to provide a letter of credit in favor of Lender in the face amount of
Five Hundred Thousand Dollars ($500,000). The Lender shall be entitled to draw
against such letter of credit to the extent of the Lender's expenses for lease
commissions, tenant improvements and debt service, if the Improvements become
vacant by reason of Buyer's default. The letter of credit shall remain in place
for the ten (10) year term of the loan or earlier payoff of such loan. Buyer
agrees to properly renew such letter of credit as required to keep it in place
for such term.
34. SUBSIDIARY. Buyer agrees that it will assign its interest in this
Agreement to a wholly-owned subsidiary, which subsidiary will be a entity
created for the sole purpose of holding title to the Property.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of this _____ day of _______________________, 1998.
SELLER:
KDC-AZ, LLC, a Delaware limited
liability company
By: ▇▇▇▇ DEVELOPMENT COMPANY, LLC,
a Delaware limited liability company,
its manager
By:
--------------------------------------
Its: --------------------------------------
BUYER:
CAPITAL TITLE GROUP, INC.
By:
--------------------------------------
Its: --------------------------------------
The provisions of this Agreement
are hereby acknowledged and
agreed to:
CAPITAL TITLE GROUP, INC.
By:
--------------------------------------
Its:
--------------------------------------
"ESCROW AGENT"
GUARANTEE
▇▇▇▇ DEVELOPMENT COMPANY, LLC, a Delaware limited liability company,
hereby agrees to unconditionally and irrevocably guarantee all of the
obligations of Seller set forth in this agreement.
▇▇▇▇ DEVELOPMENT COMPANY, LLC, a Delaware
limited liability company
By:
--------------------------------------
Its:
--------------------------------------
Date:
--------------------------------------
ESCROW INSTRUCTIONS
EXHIBIT A
LEGAL DESCRIPTION
EXHIBIT B
PLANS AND SPECIFICATIONS
EXHIBIT C
CONTRACTS AND AGREEMENTS
EXHIBIT D
TANGIBLE PERSONAL PROPERTY
EXHIBIT E
PROMISSORY NOTE
EXHIBIT F
ASSIGNMENT OF TENANT'S INTEREST IN GROUND LEASE
EXHIBIT G
▇▇▇▇ OF SALE
------------
For valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, KDC-AZ, LLC, a Delaware limited liability company (the
"Seller") hereby conveys to CAPITAL TITLE GROUP, INC. (the "Buyer"), all of
Seller's right, title and interest in and to those certain items of personal
property described on Exhibit A attached hereto and made a part hereof (the
"Personal Property").
Seller has not made and does not make any express or implied warranty
or representation of any kind whatsoever with respect to the Personal Property,
including, but not limited to: title, merchantability of the Personal Property
or its fitness for any particular purpose; the design or condition of the
Personal Property ; workmanship or compliance of the Personal Property with the
requirements of any law, rule, specification or contract pertaining thereto;
patent infringement or latent defects, except that Seller warrants that the
Personal Property is free and clear of all liens, claims and encumbrances in
favor of any third party. Purchaser accepts the Personal Property on an "AS IS,
WHERE IS" basis, and "WITH ALL FAULTS."
IN WITNESS WHEREOF, Seller has caused this instrument to be executed
and delivered as of the day of , 1998.
KDC-AZ, LLC, a Delaware
limited liability company
By: ▇▇▇▇ DEVELOPMENT COMPANY, LLC,
a Delaware limited liability
company, its member
By:
---------------------------------------
Its:
---------------------------------------
EXHIBIT A
PERSONAL PROPERTY
[To Come]
EXHIBIT H
ASSIGNMENT AND ASSUMPTION OF CONTRACTS
For valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, KDC-AZ, LLC, a Delaware limited liability company (the
"Assignor"), hereby assigns and delegates to CAPITAL TITLE GROUP, INC., an
Arizona corporation (the "Assignee"), with an office and place of business at
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇ ▇▇., ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, and Assignee hereby
assumes and accepts the assignment and delegation of all of Assignor's right,
title and interest in, to and under the contracts described on Exhibit A
attached hereto.
Assignor hereby agrees to indemnify Assignee against and hold Assignee
harmless from any and all cost, liability, loss, damage or expense, including,
without limitation, reasonable attorneys' fees and costs, originating prior to
and including the date hereof and arising out of Assignor's obligations under
the Contracts described in Exhibit A. Assignee hereby agrees to hold Assignor
harmless from any and all cost, liability, loss, damage or expense, including,
without limitation, reasonable attorneys' fees, originating after the date
hereof and arising out of the Assignee's obligations under the Contracts
described in Exhibit A.
If any litigation between Assignor and Assignee arises out of the
obligations of the parties under this Assignment or concerning the meaning or
interpretation of any provision contained herein, the losing party shall pay the
prevailing party's costs and expenses of such litigation including, without
limitation, reasonable attorneys' fees.
This Agreement may be executed and delivered in any number of
counterparts, each of which so executed and delivered shall be deemed to be an
original and all of which shall constitute one and the same instrument.
IN WITNESS WHEREOF, Assignor and Assignee have executed this Assignment
effective as of the day of , 1998.
ASSIGNOR:
KDC-AZ, LLC, a Delaware limited liability
company
By: ▇▇▇▇ DEVELOPMENT COMPANY, LLC,
a Delaware limited liability
company, its manager
By:
-------------------------------------
Its:
-------------------------------------
ASSIGNEE:
CAPITAL TITLE GROUP, INC.
By:
-------------------------------------
Name:
-------------------------------------
Its:
-------------------------------------
EXHIBIT A
CONTRACTS
[To Come]