Exhibit 10.2
AGREEMENT OF SALE
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THIS AGREEMENT OF SALE, dated August 5, 2005, is made by and between
The Commomwealth Group, Ltd., a Delaware corporation ("Buyer") and Artesian
Development Corporation, a Delaware corporation ("Seller").
1. PROPERTY. Seller agrees to convey to Buyer, and Buyer agrees to
purchase the land, with improvements erected thereon, if any, located on
Churchmans Road, New Castle County, Delaware and designated by the New Castle
County taxing authorities as Tax Parcel No. 09-19.00-043 ("Property").
2. PURCHASE PRICE. Buyer shall pay Seller ONE MILLION THREE HUNDRED
FIFTY THOUSAND AND NO/100 Dollars ($1,350,000.00) for the Property, payable as
follows: (i) $170,000.00 within fourteen days (14) of signing of this Agreement
(collectively with $30,000 previously paid, the "Deposit"), said sum to be
deposited by Buyer with Seller and delivered and disbursed at settlement or
sooner in accordance with the provisions of this Agreement; and (ii) the balance
of the purchase price, at the time of settlement hereunder. If Seller gives
notice to Buyer at least five banking days prior to settlement, the net proceeds
of sale payable to Seller shall be paid by wire transfer or by cashiers or
certified check as specified by Seller.
3. MORTGAGE CONTINGENCY. This sale and settlement hereunder are NOT
contingent upon Buyer's obtainment of any bank or other financing.
4. SETTLEMENT. Settlement shall be held at 10:00 a.m. at the offices of
Buyer's counsel in New Castle County, Delaware on a date to be selected by Buyer
and noticed to Seller not less than fourteen (14) days in advance, which date
shall be not later than 12 months following Seller's execution and delivery of
this Agreement to Buyer.
5. POSSESSION. Possession of the Property shall be delivered by Seller
to Buyer at settlement.
6. TRANSFER TAXES; PRO-RATED CHARGES. Applicable transfer taxes shall
be paid one-half by Buyer and one-half by Seller. Taxes, water, sewer and any
other lienable charges imposed by the State of Delaware and any political
subdivision thereof shall be apportioned at the time of settlement.
7. TITLE. Title to the Property is to be conveyed by deed of special
warranty and is to be good, marketable, fee simple absolute title of record,
free and clear of all liens and encumbrances of record and free and clear of
zoning and subdivision violations, but subject to all existing easements and
restrictions of record provided that same do not materially interfere with
Buyer's intended use of the Property. If Seller is unable to give a good and
marketable title meeting the foregoing requirements, such as will be insured at
regular rates by a title insurer duly authorized to transact insurance in the
state of Delaware, Buyer shall have the option of taking such title as Seller
can give, without reduction of the purchase price, or of being repaid all
deposit money, in which case this Agreement shall become null and void. Seller
agrees to execute and deliver such title affidavits and other documents as may
be reasonably required by the title company undertaking to insure title to the
Property.
8. INCLUSIONS IN SALE. Intentionally omitted.
9. BUYER'S CONTINGENCIES. The purchase and sale provided for herein is
subject to the following contingencies for the benefit of the Buyer:
(a) receipt of:
(i) in final and unappealable form of all such governmental
approvals (the "Development Approvals") as are necessary to
permit development and use of the Property as a medical office
facility incorporating not less than 42,000 square feet of
leasable space together with other related amenities in
accordance with designs and specifications reasonably
satisfactory to Buyer (the "Improvements"); and
(ii) an environmental audit report from an environmental
consulting firm selected by Buyer demonstrating that the
Property complies with all federal, state and local
environmental laws and regulations and that there exists no
condition upon the Property that is more likely than not to
require remedial or corrective measures pursuant to such laws
as interpreted as of the date of final settlement;
(b) the absence of any building moratorium or similar restriction,
however denominated, which would prevent or delay development and
occupancy of the Improvements or the improvements located on the
Property;
(c) the absence of any condemnation proceedings pending or threatened
against the Property; and
(d) the truth of the representations and warranties of Seller set forth
in this Agreement.
In connection with satisfying the contingencies set forth in this
paragraph and elsewhere in this Agreement, Seller agrees: (i) to furnish to
Buyer all title reports, surveys, plans, results of engineering, soil and
environmental studies and all other information Seller has in its possession or
control with respect to the Property; and (ii) to permit Buyer the right to
enter onto the Property for the purpose of conducting such activities as are
contemplated in this Agreement. Seller further agrees to cooperate with Buyer in
satisfying the contingencies contained in this Agreement.
Buyer agrees to assume responsibility for satisfying the contingencies
set forth in this paragraph at its sole cost and expense.
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In the event that as of the time of settlement any of the foregoing
contingencies shall remain unsatisfied, Buyer shall have the option to declare
this Agreement null and void whereupon all deposit moneys shall be retained by
Seller as its sole liquidate damages and the rights and obligations of the
parties shall be at an end.
9A. SELLER'S CONTINGENCIES. The purchase and sale provided for herein
is subject to the following contingencies for the benefit of the Seller:
(a) execution and delivery of such easements and other agreements as
are necessary to establish a right of pedestrian and vehicular ingress,
egress and regress to and from the property designated by the New
Castle County taxing authorities as Tax Parcel 09-019.00-042 (the
"Remaining Property") and Churchmans Road via the private street which
is located on the Property, including a reasonable allocation of the
cost and expense of maintaining, repairing, and replacing such street
between and among the property owners benefiting from same; and
(b) execution and delivery of such easements and other agreements as
are necessary to provide for facilities for the administration of storm
water run off from each of the Property and the Remaining Property in a
manner which: (i) preserves substantially intact the developability of
such properties; and (ii) is consistent with the requirements of
authorities having jurisdiction, and which provide for a reasonable
allocation of the cost and expense of maintaining, repairing, and
replacing such facilities between and among the property owners
benefiting from same.
10. RISK OF LOSS. Any loss or damage to the Property by fire, windstorm
or other casualty prior to settlement shall be borne by Seller.
11. REPRESENTATIONS AND WARRANTIES OF SELLER. Seller represents and
warrants to Purchaser as follows:
(a) that except as otherwise provided herein or as may be disclosed by
a title search of the Property, other than Seller there are no other
persons or entities in possession of the Property or of any part
thereof, and no party has been granted any license, lease, or other
right relating to the use or possession of any of the Property, or any
part thereof;
(b) that to Seller's knowledge, Seller has good and indefeasible fee
simple title to the Property;
(c) that Seller has not received notice of, and has no other knowledge
or information of, any pending or contemplated change in any legal
requirements applicable to the Property, of any pending or threatened
judicial or administrative action, or any action pending or threatened
by adjacent landowners or other persons, any of which would result in a
material change in the physical condition of the Property, or any part
thereof, or in any way limit or impede, in any material respect, use of
the Property, or any part thereof;
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(d) that the execution and delivery of this Agreement and the
consummation of the transaction herein contemplated will not conflict
with or, with or without notice or the passage of time, or both, result
in a breach of, any judgment, order, or decree of any court having
jurisdiction over Seller or Seller's properties;
(e) that except for debts, liabilities, and obligations for which
provision is herein made for proration or which will be paid at final
settlement, there will be no debts, taxes, liabilities or obligations
of Seller with respect to the Property outstanding as of final
settlement; and
(f) that Seller is not a "foreign person" as that term is defined in
Section 1445 of the Internal Revenue Code of 1986, as amended, and
regulations promulgated thereunder.
12. ENTIRE AGREEMENT. Except as otherwise specified in this Agreement,
Buyer agrees to purchase the Property "AS IS", in its present condition. Buyer
and Seller agree that they have read and fully understand this Agreement, that
it contains the entire agreement between them and that they do not rely on any
written or oral representation or statement not expressly written in this
Agreement. This Agreement shall not be amended except in writing signed by Buyer
and Seller.
13. ESCROW AGENT. The Escrow Agent named herein will have no liability
to either Buyer or Seller for performance of any of the terms and conditions of
this Agreement except to hold and pay over deposit money as specifically
provided herein. Escrow Agent agrees to hold all funds delivered to it hereunder
in an interest bearing account at a commercial bank doing business in
Wilmington, Delaware with interest accruing to the benefit of Buyer. Buyer
acknowledges that Escrow Agent is acting as counsel to Seller hereunder and
waives the right to assert any conflict of interest relating thereto.
14. TIME OF ESSENCE; DEFAULT OF BUYER; TENDER. Time is of the essence
of this Agreement. If Buyer fails to perform any of the terms or conditions of
this Agreement, Seller shall have the right and option to declare this Agreement
null and void and to receive and retain deposit as liquidated damages for such
default by Buyer as Seller's sole remedy.
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15. NOTICES. Any notice to Buyer hereunder shall be addressed to:
The Commonwealth Group, Ltd.
000 Xxxxx Xxxxxx, Xxxxx 000
Xxxxxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxx
and any notice to Seller hereunder shall be addressed to:
Artesian Development Corporation
000 Xxxxxxxxx'x Xxxx
Xxxxxx, Xxxxxxxx 00000
Attention: Xxxx X. Xxxxxxxxxx, XX, Esquire
All notices shall be in writing, shall be delivered by facsimile, by hand, or
mailed by first class mail, postage prepaid, and shall be effective when
delivered or when mailed.
16. SUCCESSION. This Agreement shall not be assigned by Buyer without
Seller's prior written consent which may be granted or withheld in Seller's sole
and absolute discretion, except that Buyer may without Seller's consent assign
this Agreement to an entity that is under common control with Buyer.
17. MISCELLANEOUS. Delaware law governs this Agreement. The paragraph
captions of this Agreement are inserted for purposes of convenient reference
only and are not intended to limit or enlarge the substance of this Agreement.
18. COMMISSIONS. Buyer and Seller represent to each other that neither
has dealt with any real estate broker or salesperson in connection with this
transaction. Each party agrees to indemnify and hold the other party harmless
from and against any and all claims by real estate brokers or salespersons which
are founded upon any actual or alleged agreement or course of dealing between
such brokers or salespersons and such party.
19. NO RECORDING. This Agreement shall not be recorded in the office of
any recorder or in any other office or place of public record. If Buyer shall
record this Agreement or cause or permit it to be recorded, Seller may, at
Seller's option, elect to treat such act as a breach of this Agreement. Seller
or its affiliate will disclose this Agreement pursuant to the federal securities
laws.
20. LIKE KIND EXCHANGE. Seller reserves the right to consummate this
transaction via a like kind exchange of properties pursuant to section 1031 of
the Internal Revenue Code of 1986, as amended, and regulations promulgated
thereunder, or analogous provision of any successor law. Buyer agrees to
cooperate with Seller in connection with any such exchange provided that
settlement hereunder shall not be delayed, nor contingent upon such exchange,
and such cooperation shall not expose Buyer to any cost, expense, or direct or
contingent liability.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement or
have caused same to be executed by their duly authorized representatives as of
the dates set forth beneath their respective names.
Buyer
/s/ Xxx Xxxxx THE COMMOMWEALTH GROUP, LTD
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Attest:
Name: /s/ R. Xxxxxx Xxxxxx
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Title: R. Xxxxxx Xxxxxx, Vice-President
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Date: 5 August 2005
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Seller
/s/Xxxxx X. Xxxxxx ARTESIAN DEVELOPMENT CORPORATION
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Attest:
Name: /s/ Xxxx X. Xxxxxx
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Title: Xxxx X. Xxxxxx, President and CEO
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Date: 5 August 2005
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