EXHIBIT 10.1
COMMERCIAL CONTRACT TO BUY AND SELL REAL ESTATE
FEBRUARY 24, 1997
1. PARTIES AND PROPERTY, ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, ▇▇., ▇▇▇▇ ▇. ▇▇▇▇, ▇▇▇▇ ▇. ▇▇▇▇,
▇▇▇▇▇▇ ▇▇▇▇▇ and/or ASSIGNS, as tenants in common, (hereinafter referred to as
"Buyer") agree to buy, and the Rockies Fund, Inc., A Nevada Corporation,
(hereinafter referred to as "Seller") agrees to sell, on the terms and
conditions set forth in this contract, the following described real estate in
the County of El Paso, Colorado, to wit: ▇▇▇ ▇, ▇▇▇▇▇ ▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇,
Filing No. 20 est. part conv to City Bks 3975-110, ▇▇▇▇-▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇, and also known as ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇
▇▇▇▇▇, together with all interest of Seller in vacated streets and alleys
adjacent thereto, all easements and other appurtenances thereto, all
improvements therein and all attached fixture therein (collectively the
Property).
2. INCLUSION/EXCLUSIONS. The purchase price includes the following items:
(a) if attached to the Property on the date of this contract: lighting,
heating, plumbing, ventilating, and air conditioning fixtures, TV antennas,
water softeners, smoke/fire/burglar alarms, security devices, inside telephone
wiring and connecting blocks/jacks, plants, mirrors, floor coverings, intercom
systems, built-in kitchen appliances, sprinkler systems, and controls; (b) if
on the Property whether attached or not on the date of this contract: storm
windows, storm doors, window and porch shades, awnings, blinds, screens,
curtain rods, drapery rods, all keys and (c) all architectural and building
plans. The above described included items (inclusions) are to be conveyed to
Buyer by Seller by ▇▇▇▇ of sale at the closing, free and clear of all taxes,
items and encumbrances, except as provided in Section 12. The following
attached fixtures are excluded from this sale: None.
3. PURCHASE PRICE AND TERMS. The purchase price shall be $1,080,000,
payable in U.S. dollars by Buyer as follows:
(a) ▇▇▇▇▇▇▇ MONEY. $5,000.00 ▇▇▇▇▇▇▇ money deposit to become non-refundable
upon expiration of the inspection period and letter of assignment of the
existing promissory note and deed of trust from the bank, and party payment of
the purchase price payable to and held by Seller, in trust, on behalf of the
both Seller and Buyer to deliver the ▇▇▇▇▇▇▇ money deposit to the closing
agent, if any, at or before closing.
The balance of $1, 075,000.00 (purchase price less ▇▇▇▇▇▇▇ money) shall be
paid as follows:
(b) CASH AT CLOSING. $725,000.00, plus closing costs, to be paid by Buyer at
the closing in funds which comply with all applicable Colorado laws, which
include cash, electronic transfer funds, certified check, savings and loan
teller's check and cashier's check (Good Funds). Subject to the provisions of
Section 4, if the existing loan balance at the time of closing shall be
different from the loan balance in Section 3, the adjustment shall be made in
Good Funds at closing.
(c) ASSUMPTION. $350.000.00, by Buyers, assuming and agreeing to pay an
existing loan in the approximate amount, presently payable at $5,806.00 per
month including principal, interest presently at 8% per annum.
Buyer agrees to pay a loan transfer fee not to exceed $500.00. At the time of
assumption, the new interest rate shall not exceed 8.00% per annum and the new
monthly payment shall not exceed $5,806.00 principal and interest. Seller
shall be released from liability on said loan. If applicable, compliance with
the requirements for release from liability shall be evidenced by delivery at
closing of an appropriate letter from lender. Cost payable for release of
liability shall be paid by Buyer in an amount not to exceed $250.00.
4. FINANCING CONDITIONS AND OBLIGATIONS.
(a) LOAN APPLICATION(S). If Buyer is to pay all or part of the purchase
price as set forth in Section 3 by assuming an existing loan which is not to
be released at closing, Buyer, if required by such lender, shall make written
application within 14 calendar days from acceptance of this contract. Buyer
shall cooperate with Seller and lender to obtain loan approval, diligently and
timely pursue same in good faith, execute all documents and furnish all
information and documents required by the lender, and, subject to Section 3,
timely pay the costs of obtaining such loan or lender consent.
(b) LOAN APPROVAL. If Buyer is to pay all or part of the purchase price by
assuming the existing loan as specified in Section 3, this contract is
conditional upon lender's approval of the new loan 35 calendar days from
acceptance of this contract. If not so approved by said date, then this
contact may be extended for an additional 60 days, at Buyer's option, in order
to secure new financing. If Buyer is unable to secure acceptable financing
within the 60 day period, this contract shall terminate.
(c) EXISTING LOAN REVIEW. If an existing loan is not to be released at
closing, Seller shall provide copies of the loan documents (including note,
deed of trust, modifications) to Buyer within 7 calendar days from acceptance
of this contract. This contract is conditional upon Buyer's review and
approval of the provisions of such loan documents. Buyer consents to the
provisions of such loan documents if no written objection is received by
Seller from Buyer within 10 calendar days from Buyer's receipt of such
documents. If the lender's approval of a transfer of the Property is
required, this contract is conditional upon Buyer's obtaining such approval
without charge in the terms of such loan, except as set forth in Section 3.
(d) ASSUMPTION BALANCE. If Buyer is to pay all or part of the purchase price
by assuming an existing loan and if the actual principal balance of the
existing loan at the date of closing is less than the amount in Section 3 and
the amount of cash required from Buyer at closing is increased by more than
$15,000.00 then Buyer may terminate this contract effective upon receipt by
Seller of Buyers written notice of termination.
5. APPRAISAL PROVISIONS. Buyer shall have the right to terminate this
contract if the purchase price exceeds the Property's valuation determined by
an appraiser engaged by Buyer. If Seller receives a copy of such appraisal
or written notice from lender which confirms the Property's valuation is less
than the purchase price, on or before 35 calendar days from acceptance of this
contract (Appraisal Deadline), this contract shall terminate. Buyer shall
have the privilege and option of proceeding with consummation of this contract
without regard to the amount of the appraised valuation. Upon closing, Buyer
waives any objection to the Property's valuation.
6. COST OF APPRAISAL. Cost of any appraisal to be obtained after the
contract date shall be paid by Buyer.
7. ASSIGNABLE. Upon written consent by Seller not to be unreasonably
withheld, this contract shall be assignable by Buyer and shall inure to the
benefit of an be binding upon the heirs, personal representative, successors
and assigns of the parties.
8. EVIDENCE OF TITLE. Seller shall furnish to Buyer, at Seller's expense, a
current commitment for owner's title insurance policy in an amount equal to
the purchase price, on or before 10 calendar days from acceptance of this
contract (Title Deadline). Buyer may require of Seller that copies of
instruments (or abstracts of instruments) listed in the schedule of exceptions
(Exceptions) in the title insurance commitment also be furnished to Buyer at
Seller's expense. This requirement shall pertain only to instruments shown of
record in the office of the clerk and recorder of the designated county or
counties. The title insurance commitment together with any copies or
abstracts of instruments furnished pursuant to this Section 8, constitutes the
title documents (Title Documents). Buyer, or Buyer's designee, must request
Seller, in writing to furnish copies or abstracts of instruments listed in the
schedule of exceptions no later than 15 calendar days after Title Deadline.
Seller will pay premium at closing and have the title insurance policy
delivered to Buyer as soon as practicable after closing.
9. TITLE.
(a) TITLE REVIEW. Buyer shall have the right to inspect the Title Documents.
Written notice by Buyer of unmerchantability of title or of any other
unsatisfactory title condition shown by the Title Documents or abstract shall
be signed by or on behalf of Buyer and given to Seller on or before 20
calendar days after Title Deadline, or within five (5) calendar days after
receipt by Buyer of any Title Document(s) or endorsement(s) adding new
Exception(s) to the title commitment together with a copy of the Title
Document adding new Exception(s) to title. If Seller does not receive Buyer's
notice by the date(s) specified above, Buyer accepts the condition of title as
disclosed by the Title Documents as satisfactory.
(b) MATTERS NOT SHOWN BY THE PUBLIC RECORDS. Seller shall deliver to Buyer,
on or before the Title Deadline set forth in Section 8, true copies of all
lease(s) and survey(s) in Seller's possession pertaining to the property and
shall disclose to Buyer all easements, (liens or other title matters not shown
by the public records of which Seller has actual knowledge. Buyer shall have
the right to inspect the property to determine if any third party(s) has any
right in the property not shown by the public records (Such as an unrecorded
easement,unrecorded lease, or boundary line discrepancy). Written notice of
any unsatisfactory condition(s) disclosed by Seller or revealed by such
inspection shall be signed by or on behalf of Buyer and given to Seller on or
before 20 days from the Title Deadline. IF Seller does not receive Buyer's
notice by said date, Buyer accepts title subject to such rights, if any, of
third parties of which Buyer has actual knowledge.
(c) SPECIAL TAXING DISTRICTS. Special taxing districts may be subject to
general obligation indebtedness that is paid by revenue produced from annual
tax (levies on the taxable property within such districts. Property owners in
such districts may be placed at risk for increased mill levies and excessive
tax burdens to support the servicing of such debt where circumstances arise
resulting in the inability of such a district to discharge such indebtedness
without such an increase in mill levies. Buyer should investigate the debt
financing requirements of the authorized general obligation indebtedness of
such districts, existing mill levies of such district servicing such
indebtedness, and the potential for an increase in such mill levies. In the
event the property is located within a special district servicing such
indebtedness, and the potential for an increase in such mill levies. In the
event the Property is located within a special taxing district and Buyer
desires to terminate this contract as a result, if written notice is given to
Seller on or before the date set forth in Section 9 (b), this contract shall
then terminate. If Seller does not receive Buyer's notice by the date
specified above, Buyer accepts the effect of the Property's inclusion in such
special taxing district(s) and waives the right to so terminate.
(d) RIGHT TO CURE. If Seller receives notice of unmerchantability of title
or any other unsatisfactory title condition(s) as provided in subsection (a)
or (b) above, Seller shall use reasonable effort to correct said
unsatisfactory title condition(s) prior to the date of closing. If Seller
fails to correct said unsatisfactory title condition(s) on or before the date
of closing, this contract shall then terminate; provided, however, Buyer may,
by written notice received by Seller, on or before closing, waive objection to
said unsatisfactory title condition(s).
10. INSPECTION. Seller agrees to provide Buyer on or before 10 calendar days
from acceptance of this contract with a Seller's Property Disclosure form
completed by Seller to the best of Sellers current actual knowledge. Buyer or
any designee, shall have the right to have inspection(s) of the physical
condition of the Property and inclusions, at Buyer's expense. If written
notice of any unsatisfactory condition, signed by or on behalf of Buyer, is
not received by Seller on or before 30 days of receipt of Seller's Property
Disclosure form (Objection Deadline), the physical condition of the property
and inclusions shall be deemed to be satisfactory to Buyer. If such notice is
received by Seller as set forth above, and if Buyer and Seller have not
agreed, in writing, to a settlement thereof on or before 5 days following the
Resolution Deadline; unless, within the three calendar days, Seller receives
written notice from Buyer waiving objection to any unsatisfactory condition.
Buyer is responsible for and shall pay for any damage which occurs to the
Property and inclusions as a result of such inspection.
11. DATE OF CLOSING. The date of closing shall be March 31, 1997, or by
mutual agreement at an earlier date. The place of closing shall be Land Title
Company in Colorado Springs. The hour of closing shall be as designated by
Seller and Buyer at a later date.
12. TRANSFER OF TITLE. Subject to tender or payment at closing as required
herein and compliance by Buyer with the other terms and provisions hereof,
Seller shall execute and deliver a good and sufficient General Warranty Deed
to Buyer, on closing conveying the Property free and clear of all taxes except
the general taxes for the year of closing, and without further exceptions.
Title shall be conveyed free and clear of all liens for year of closing, and
without further exceptions. Title shall be conveyed free and clear of all
liens for special improvements installed as of the date of Buyer's signature
heron, whether assessed or not; except (i) distribution utility easements
(including cable TV), (ii) those matters reflected by the Title Documents
accepted by Buyer in accordance with subsection 9 (a), (iii) those rights, if
any of third parties in Property not shown by the public records in accordance
with subjection 9 (b), (iv) inclusion of the Property with any special taxing
district, and (v) subject to building and zoning regulations.
13. PAYMENT OF ENCUMBRANCES. Any encumbrance required to be paid shall be
paid at or before closing from the proceeds of transaction or from any other
source.
14. CLOSING COSTS, DOCUMENTS AND SERVICES. Buyer and Seller shall pay, in
Good Funds, their respective closing costs and all other items required to be
paid at closing, except as otherwise provided therein. Buyer and Seller shall
sign and complete all customary or required documents at or before closing.
Fees for real estate closing services shall not exceed $300.00 and shall be
paid at closing by Buyer and Seller equally. Any local transfer tax and sales
and use tax that may accrue because of this transaction shall be paid when due
by Seller.
15. PRORATIONS. General taxes for the year of closing, based on the taxes
for the calendar year immediately proceeding closing, rents, water and sewer
charges, all other utilities, insurance owner's association dues, and interest
on continuing loan(s), if any, and all other building operating expenses shall
be prorated to date of closing.
16. POSSESSION. Possession of the Property shall be delivered to Buyer at
closing subject to the existing Lease(s) or tenancy(s), except the Rockies
Fund, Inc. shall lease their existing space for the sum of 1,000.00 per month
for one year from the date of closing subject to the terms and conditions of
the Navigator's lease. Further, The Rockies Fund, Inc., shall have an option
to lease their existing space for an additional four years at 7% below the
then market rate which is also subject to the terms and conditions of the
Navigator's lease.
17. CONDITION OF AND DAMAGE TO PROPERTY. Except as otherwise provided in
this contract, the Property and Inclusions shall be delivered in the condition
existing as of the date of this contract, ordinary were and tear excepted. In
the event the Property shall be damaged by fire or other casualty prior to the
time of closing, in an amount of not more than ten percent of the total
purchase price, Seller shall be obligated to repair the same before the date
of closing. in the event such damage is not repaired within said time or if
the damage exceeds such sum, this contract may be terminated at the option of
the Buyer. Should Buyer elect to carry out this contract despite such damage,
Buyer shall be entitled to credit for all the insurance proceeds resulting
from such damage to the Property and Inclusions, not exceeding, however, the
total purchase price. Should any inclusion(s) or service(s) fall or be damage
between the date of this contract and the date of closing or the date of
possession, whichever shall be earlier, then Seller shall be liable for the
repair or replacement of such insurance proceeds received by Buyer covering
such repair or replacement.
18. SURVEY. Seller, at its expense shall furnish purchaser with a current
boundary line and improvement survey of the premises, to be prepared by a
dully licensed Colorado land surveyor, on or before 21 days after mutual
acceptance of this contract. This survey shall show the location of all
improvements, streets, roads, easements, rights-of-way on or adjacent to the
premises, and shall set forth the total acreage and the number of net square
feet comprising the land and building, and shall set forth the total average
and the number of net square feet comprising the land and building, and shall
contain the surveyors certification to seller, purchaser and the title
company. Such survey shall also show the location and size of the water
lines, sanitary sewer lines, and utility lines serving the premises, as well
as all other easements and rights-of-way which shall be identified with the
proper recording book and page of instruments creating such easements and
rights-of-way. The survey shall state that a physical inspection of the
property revealed no improvements situated upon or adjacent to the property
which are the subject of any encroachments and that no easements or rights-of-
way have been physically violated in any respect.
19. OFFSETS OR CLAIMS. Seller warrants that to the best of Seller's
knowledge, no fact exists giving rise to any offsets or claims against
Landlord by tenant or other third parties relating to the property and/or
lease, and agrees to indemnify and hold Purchaser harmless against said offset
or claims for events that occur prior to the closing date.
20. TIME OF ESSENCE/REMEDIES. Time is of the essence hereof. If any note or
check received as ▇▇▇▇▇▇▇ money hereunder or any other payment due hereunder
is not paid, honored or tendered when due, or if any other obligation
hereunder is not performed or waived as herein proved, there shall be the
following remedies:
(a) IF BUYER IS IN DEFAULT: All payments and things of value received
hereunder shall be forfeited by Buyer and retained on behalf of Seller and
both parties shall thereafter be released from all obligations hereunder. It
is agreed that such payments and things of value are LIQUIDATED DAMAGES and
(except as provided in subsection (c) are SELLER'S SOLE AND ONLY REMEDY for
Buyer's failure to perform the obligations of this contract. Seller expressly
waives the remedies of specific performance and additional damages.
(b) IF SELLER IS IN DEFAULT. Buyer may elect to treat this contract as
canceled, in which case all payments and things of value received hereunder
shall be returned and Buyer may recover such damages as may be proper, or
Buyer may elect to treat this contract as being in full force and effect and
Buyer shall have the right to specific performance or damages, or both.
(c) COSTS AND EXPENSES. Anything to the contrary herein notwithstanding, in
the event of any arbitration or litigation arising out of this contract, the
arbitrator or court shall award to the prevailing party all reasonable costs
and expenses, including attorney fees.
22. ▇▇▇▇▇▇▇ MONEY DISPUTE. Notwithstanding any termination of this contract,
Buyer and Seller agree that, in the event of any controversy regarding the
▇▇▇▇▇▇▇ money and things of value held by broker or closing agent, unless
mutual written instruction are received by the holder of the ▇▇▇▇▇▇▇ money and
things of value, broker or closing agent shall not be required to take any
action but may await any proceeding, or at broker's or closing agent's option
and sole discretion, may interplead all parties and deposit any moneys or
things of value into a court of competent jurisdiction and shall recover court
costs and reasonable attorney fees.
23. ALTERNATIVE DISPUTE RESOLUTION; MEDITATION. If a dispute arises between
the parties relating to this contract, the parties agree to submit the dispute
to mediation. The parties will jointly appoint an acceptable may then proceed
with such other means of dispute resolution as they do chose.
24. TERMINATION. In the event this contract is terminated, all payments and
things of value received hereunder shall be returned and the parties shall be
retrieved of all obligations hereunder, subject to Section 19.
25. NOTICE TO PARTIES. Any notice to Buyer shall be effective when received
by Buyer. Any notice to seller shall be effective when received by Seller.
26. NOTIFICATION OF THIS CONTRACT. No subsequent modification of any of the
terms of this contract shall be valid binding, upon the parties, or
enforceable unless made in writing and signed by the parties.
27. ENTIRE AGREEMENT. This contract constitutes the entire contract between
the parties relating to the subject hereof, and any prior agreement pertaining
thereto, whether oral or written, have been merged and integrated into this
contract.
28. NOTICE OF ACCEPTANCE; COUNTERPARTS. This proposal shall expire unless
accepted in writing, by Buyer and Seller, as evidenced by their signatures
below, and the offering party receives notice of such acceptance on or before
5:00 p.m. on February 24, 1997. If accepted, this document shall become a
contract between Seller and Buyer. A copy of this document may be executed by
each party, separately, and when each party has executed a copy thereof, such
copies taken together shall be deemed to be a full and complete contract
between the parties.
BUYER: SELLER:
▇▇▇▇▇▇ ▇. ▇▇▇▇▇ by POA ▇.▇. ▇▇▇▇▇ By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇
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▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ by POA ▇.▇. ▇▇▇▇▇ The Rockies Fund, Inc., A Nevada Corp.
/s/ ▇▇▇▇ ▇. ▇▇▇▇
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(Affix Corp. Seal Here)
/s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
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/s/ ▇▇▇▇ ▇▇▇▇
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* Seller shall attach hereto a copy of the corporate resolution which
approves the execution of this contract.
29. Seller shall give Buyer a credit at closing for all tenant security
deposits currently held, and any and all prepaid rents.
30. Seller represents and warrants that it is unaware of any changes to the
property that would alter the existing environmental survey dated .
31. Seller shall turn over possession of all documents, leases, contracts,
etc. relating to the operation of the property.
32. Sellers, The Rockies Fund, Inc., hereby elect to include this purchase
and sale in a tax-deferred or delayed exchange. Buyer shall cooperate with
Seller in executing documents necessary and appropriate to accomplish such
exchange, provided that the same does not delay close of escrow and is
accomplished at to cost or liability to the Buyer.
