Exhibit 2.1
SALE CONTRACT
THIS SALE CONTRACT is made and entered into as of this 13th
day of November, 1998, by and between AMERICAN SPECTRUM REALTY INC., a Maryland
Corporation, as Purchaser and XXXXXX REAL PROPERTY INVESTORS-FOUR, L.P., a
Missouri limited partnership, as Seller,
WITNESSETH:
WHEREAS, Seller is the owner of an apartment complex known as
Woodhollow Apartments, consisting of 402 units located on Xxxxxxx Road, in St.
Louis County, Missouri, which is described on Exhibit A, attached hereto and
incorporated herein by reference (the "Property"),
WHEREAS, Seller has agreed to sell to Purchaser and Purchaser
has agreed to purchase from Seller the Property on the terms and conditions set
forth herein,
NOW THEREFORE, for and in consideration of the foregoing and
of the mutual covenants hereof, the parties hereto stipulate, covenant, and
agree as follows:
1. Seller agrees to sell to Purchaser and Purchaser hereby
agrees to purchase from Seller the fee simple title to the Property for Fourteen
Million Six Hundred Thousand Dollars ($14,600,000.00) paid on the Closing Date
plus the amount of capital paid by Seller for certain capital expenditures
listed in the appraisal by C. B. Xxxxxxx Xxxxx dated May 19, 1998 from the date
of the appraisal to Closing Date and not to exceed Eight Hundred Eighty Thousand
Dollars ($880,000.00) (this amount is referred to herein as the "Purchase
Price"). The Purchaser shall take title to the Property subject to first lien
financing in favor of NationsBank, N.A. in the face amount of Fourteen Million
Dollars ($14,000,000.00), which encumbers the Property and other property known
as Cobblestone Court Shopping Center, in Burnsville, Minnesota ("Cobblestone
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Court"), which Purchaser is contracting to purchase pursuant to another Sale
Contract of even date herewith (the "NationsBank Loan"). The Purchaser shall
receive a credit at Closing for the unpaid principal balance of the Nine Million
Three Hundred Ninety-three Thousand Dollars ($9,393,000.00) of the NationsBank
Loan attributable to the Property.
2. Closing ("Closing") shall be at the offices of Commonwealth
Land Title Insurance Company, 0000 Xxxxxxx Xxxx, Xx. Xxxxx, XX 00000
("Commonwealth Title"). Possession of the Property shall be delivered to Seller
at Closing subject to the rights of tenants described on the rent roll attached
hereto as Exhibit B, and incorporated herein by reference. The "Closing Date"
shall be a date designated by Purchaser in written notice to Seller waiving the
final contingencies set forth in paragraph 6 hereof, which date must be no
earlier than ten (10) days from date of said notice and no later than thirty
(30) days from the date of said notice, provided that Purchaser shall have the
right, at Purchaser's option, to extend the Closing Date for two additional
periods of thirty (30) days each upon giving to Seller written notice of each
such extension, at least five (5) days prior to the previously scheduled Closing
Date, each of which notices in order to be valid and effective, must be
accompanied by an additional nonrefundable Xxxxxxx Money deposit to Commonwealth
Title in the amount of One Hundred Thousand Dollars ($100,000.00).
3. On the Closing Date Seller will deliver to Purchaser a
Special Warranty Deed for the Property, together with a Xxxx of Sale, an
Assignment of Leases, an Assignment of Contracts, an Assignment of Trade Name,
and a Non-Foreign Affidavit, the form of all of said documents being attached
hereto as Xxxxxxxx X, X-0, X, X, X xxx X and incorporated herein by reference.
Purchaser shall simultaneously deliver to Seller a Federal Reserve Wire Transfer
in the amount of the Purchase Price subject to adjustments as provided herein.
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At closing, Seller shall pay in full all deeds of trust encumbering the Property
and shall deliver to Purchaser an updated rent roll updating the rent roll
attached hereto as Exhibit B.
4. The parties shall make Closing Adjustments in accordance
with the Closing Practices of the Real Estate Board of Metropolitan St. Louis.
Any delinquent rents, common area payments or real estate tax or insurance
payments will not be prorated at Closing, but if collected by Purchaser will be
paid to Seller when received by Purchaser. All amounts collected by Purchaser
from tenants shall first be applied to all amounts due and payable with respect
to the period from and after Closing. Any excess shall be promptly paid to
Seller to the extent of any delinquent amounts due Seller from tenants. Seller
shall have the right to bring action against the tenants in question for any
such delinquencies provided Seller shall have no right to commence any eviction
action against any tenant without Purchaser's prior written consent. All
security deposits paid by tenants under leases affecting the Property shall be
paid by Seller to Purchaser at Closing. At Closing and only on condition that
Closing is actually consummated, Seller shall reimburse Purchaser for the costs
of an Owner's Policy of Title Insurance, a Mortgagee's Policy of Title
Insurance, an ALTA Survey of the Property, title company closing and escrow
fees, environmental and engineering studies, tests, and reports with respect to
the Property, other reasonable expense of Purchaser's due diligence exclusive of
legal expense and cost of Purchaser's employees and officers, said reimbursement
not to exceed the sum of Fifty Thousand Dollars ($50,000.00) in the aggregate.
In the event that, for any reason, Closing is not actually consummated, Seller
shall have no obligation to reimburse Purchaser for any of the foregoing
expenses. Each party shall pay the fees and other charges of its own legal
counsel.
5. Upon fulfillment or waiver of the contingencies specified
in paragraph 6 of this Sale Contract, Purchaser shall deposit with Commonwealth
Title nonrefundable Xxxxxxx Money in the amount of Two Hundred Fifty Thousand
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Dollars ($250,000.00) in an interest bearing account with interest to be paid to
Purchaser prior to Closing. The aforesaid deposit and all additional deposits of
Xxxxxxx Money are herein in the aggregate called the "Xxxxxxx Money," as shall
be held in escrow by Commonwealth Title and paid by Commonwealth Title to the
party entitled thereto hereunder. If sale be closed, the Xxxxxxx Money shall be
applied to the Purchase Price. If sale be not closed due and owing to the fault
of Purchaser, the Xxxxxxx Money shall be paid over to Seller as liquidated
damages because the parties have stipulated and agreed that actual damages would
be very difficult to ascertain. If Seller fails or refuses to close hereunder,
Purchaser shall be entitled to have all nonrefundable Xxxxxxx Money returned to
Purchaser, and Purchaser shall be entitled to terminate this Sale Contract or to
specific performance of this Sale Contract but not to any damages. In all other
events wherein Purchaser is obligated to close hereunder, all Xxxxxxx Money is
not to be refunded to Purchaser, but is to be paid to Seller and retained by
Seller as Seller's own property. Seller shall not be entitled to specific
performance or to any remedy at law or in equity for breach of this Sale
Contract other than the aforesaid liquidated damages.
6. The obligation of Purchaser to close under this Sale
Contract is expressly contingent upon compliance with each of the following
conditions and occurrence of each of the following events on or before the
respective Contingency Date shown hereinafter for each contingency. In the event
that on or before the Contingency Dates shown hereinafter, there has not been
compliance with any of the following conditions or any of the following events
have not occurred, then Purchaser may, at its option, terminate this Sale
Contract or waive the unfulfilled contingencies. On or before each Contingency
Date, Purchaser shall notify Seller in writing (i) that the contingencies in
question have been fulfilled or waived, or (ii) that this Sale Contract is
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terminated by reason of unfulfilled contingencies. Failure to give notice within
the times set forth herein shall be deemed an election to terminate this Sale
Contract because of unfulfilled contingencies, and failure to make the Xxxxxxx
Money deposit upon waiver of contingencies shall render this Sale Contract null
and void and of no further force and effect. In the event Purchaser exercises
said option to terminate this Sale Contract, this Sale Contract shall be of no
further force and effect, and neither party shall have any further rights,
obligations, or liability hereunder.
a. Purchaser, at Purchaser's expense, shall have
obtained from Commonwealth Title a Commitment for an ALTA Form B
Owner's policy of Title Insurance on the Property with exception only
for such items as are satisfactory to Purchaser in Purchaser's sole
judgment. Seller shall furnish such reasonable affidavits and evidence
of payment of bills for labor and materials as may be necessary for
Purchaser to obtain an ALTA form Owner's Policy of Title Insurance in
accordance with said Commitment and with the standard exceptions for
mechanics' liens and parties in possession (other than the tenants
shown on the rent roll attached hereto as Exhibit B) deleted.
(Contingency Date: 60 days after the date on which Purchaser receives
written notice from Seller of the fulfillment of the approval condition
specified in paragraph 11 hereof, the "Partner Approval Date").
b. Purchaser shall have received, at Purchaser's
expense, a survey and physical inspection report for the Property which
are satisfactory to Purchaser, in Purchaser's sole judgment and
discretion. Seller agrees to provide access to the Property as
reasonably required by Purchaser to complete said survey and physical
inspection report. Seller shall deliver to Purchaser within five (5)
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days after the Acceptance Date copies of any and all surveys which
Seller may have of the Property. (Contingency Date: 60 days after the
Partner Approval Date).
c. Purchaser having obtained, at Purchaser's expense,
written environmental reports, satisfactory to Purchaser in Purchaser's
sole judgment, confirming that the Property and adjacent properties are
free of all hazardous materials which might cause the Property to be in
violation of any applicable environmental laws or governmental
regulations. Seller agrees to provide access to the Property as
reasonably required by Purchaser to complete said environmental report,
said access to be provided in accordance with paragraph 15 hereof.
Seller shall deliver to Purchaser within five (5) days after the
Acceptance Date copies of any and all environmental reports relating to
the Property which Seller may have or which may be reasonably available
to Seller. (Contingency Date: 60 days after the Partner Approval Date).
d. Purchaser's review and approval of all existing
leases and financial information provided by Seller. Seller has
delivered to Purchaser copies of Seller's internally generated
statements of income and expenses of the Property for fiscal years
1996, 1997 and 1998 to date. (Contingency Date: 60 days from the
Partner Approval Date).
e. Purchaser's review and approval of all
maintenance, service agreements, and other contracts affecting the
Property, copies of which Seller shall deliver to Purchaser within five
(5) days after the Acceptance Date. (Contingency Date: 60 days from the
Partner Approval Date).
f. Purchaser shall have received evidence
satisfactory to Purchaser in its sole discretion that the Property is
constructed and operated in accordance with all applicable zoning,
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building code and other similar laws and ordinances. (Contingency Date:
60 days from the Partner Approval Date).
g. Purchaser shall have approved, in Purchaser's sole
judgment and discretion, all terms and conditions of the NationsBank
Loan and all loan documents with respect to the NationsBank Loan and
Purchaser shall be satisfied, in Purchaser's sole judgment and
discretion, that Purchaser can take title to the Property subject to
the NationsBank Loan without assumption of any personal liability and
with all agreements between NationsBank and Purchaser being
satisfactory to Purchaser in Purchaser's sole judgment and discretion.
(Contingency Date: 60 days from the Partner Approval Date).
Purchaser hereby agrees to indemnify and hold harmless Seller, from all claims
for liens against the Property and damage to the Property arising from any
activity authorized by Purchaser and from all claims of third parties for
personal injury and property damage arising from any activity authorized by
Purchaser. The foregoing indemnification by Purchaser shall automatically
survive any termination of this Sale Contract, notwithstanding provisions herein
to the effect that neither party shall have any rights or obligations hereunder,
after any termination under certain specified circumstances.
The obligation of Purchaser to close under this Sale Contract is expressly
conditioned upon there having occurred no material adverse change between the
date of Purchaser's notice waiving the contingencies contained in paragraphs 6a
and 6c hereof and Closing Date in the condition of title to the Property or the
environmental condition of the Property and upon all of Seller's representations
and warranties set forth in paragraph 7 below remaining true and complete in all
respects as of Closing.
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7. In order to induce Purchaser to purchase the Property,
Seller makes to Purchaser the following representation and warranties, which
shall be considered made as of the date hereof and as of Closing Date, and which
shall not survive Closing and shall lapse and terminate and be of no further
force or effect as of the consummation of Closing.
a. Seller has no knowledge of any actions or
proceedings pending in any court or before any governmental agency by
any tenant or by any other person affecting the Property except those
covered by insurance which are specifically described on Exhibit H
attached hereto.
b. Seller has received no notice of any alleged
violation of any fire, zoning, building, health laws or regulations, or
of any other alleged violations which affect the Property.
c. Seller has no knowledge of any latent structural
defects in the improvements on the Property.
d. All commissions due brokers for existing leases
have been paid in full; there are no future commission obligations
existing on current leases or renewals or options. All amounts payable
with respect to tenant finish, rent abatement or any offsetting credit,
charge or adjustment of any sort relating to any lease or tenant have
been paid in full. All tenants have accepted possession of their leased
premises and have commenced paying rent in accordance with the terms of
their leases.
e. The rent roll attached hereto a Exhibit B is true
and complete as of the date shown thereon.
f. There are no tenancies or occupancies affecting
the Property or persons in possession of any part of the Property
except as shown on Exhibit B hereto.
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g. Seller has no knowledge of any pollutants or
contaminants on the Property which would make the Property in violation
of any environmental laws, ordinances, or governmental regulations, and
the Property is not, to the best of Seller's knowledge, in any manner
causing or contributing to any pollution or contamination in violation
of any such environmental laws, ordinances, or governmental
regulations.
h. No voluntary proceeding under any bankruptcy or
insolvency laws have been commenced by the Seller nor have there been
any involuntary proceedings against the Seller. No general assignment
for the benefit of creditors has been made by Seller and no trustee or
receiver of Seller's property has been appointed.
i. The leases which have been delivered to Purchaser
are true and complete copies of all leases affecting the Property and
of all amendments thereto.
j. The service contracts which have been delivered to
Purchaser are true and complete copies of all service contracts
affecting the Property and of all amendments thereto.
k. As of Closing Date, Seller shall have legal
authority to sell the Property to Purchaser.
In the event of a breach of any of the above
representations, warranties or covenants, which Purchaser discovers
prior to Closing, Purchaser shall have the right, as its exclusive
remedy, of canceling this Sale Contract by giving written notice
thereof to Seller, whereupon all Xxxxxxx Money deposited hereunder
shall be promptly returned to Purchaser and neither party shall have
any further rights or obligations hereunder. In the event of breach of
the above representations, warranties or covenants, which Purchaser
discovers after Closing, Seller shall have no responsibility
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whatsoever, it being stipulated and agreed that Purchaser is relying
upon Purchaser's own knowledge and due diligence, in the event Closing
is consummated, and that all of the foregoing representations,
warranties, and covenants are waived and extinguished as of the
consummation of Closing.
8. Purchaser represents that as of Closing Date Purchaser
shall have full power and authority to enter into this Sale Contract and to
effect the transaction contemplated herein.
9. Each party hereto hereby represents to the other that said
party has dealt with no real estate broker or other person in such a manner as
to give rise to a claim for real estate commission or finders' fees against the
other party. Each party hereto hereby agrees to indemnify and hold harmless the
other party against any claims for real estate commission and/or finders' fees
arising from the transaction contemplated hereby and the conduct of the
indemnifying party.
10. If the date specified for any action in this Sale Contract
shall fall on a weekend or state or national holiday, then the date specified
for such action shall be deemed to be extended to the next business day
following.
11. Seller hereby advises Purchaser that it is necessary for
Seller to obtain the consent of Seller's limited partners in order to sell the
Property to Purchaser as herein provided. Seller shall endeavor to obtain such
consent. If, for any reason, the consent of Seller's limited partners to this
Sale Contract and to Closing hereunder has not been obtained within ninety (90)
days after Purchaser has received a fully executed copy of the Sale Contract,
(the "Acceptance Date"), then either party may, at any time thereafter,
terminate this Sale Contract by giving written notice of termination to the
other party, in which event, neither party shall have any further rights or
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obligations under this Sale Contract. Seller shall promptly give Purchaser
written notice after Seller has obtained the written consent of its limited
partners as aforesaid, so that Purchaser may commence its due diligence pursuant
to paragraph 6 hereof.
12. Seller shall make available to Purchaser such financial
and other information concerning the Property as Purchaser may reasonably
require.
13. Notices to be given hereunder shall be in writing and
shall be deemed conclusively to have been given when sent by United States
certified or registered mail, postage prepaid, or by a recognized messenger
service, addressed as follows or to such other address as either party may
furnish to the other in writing:
Purchaser
AMERICAN SPECTRUM REALTY, INC.
0000 X.X. Xxxxxxx
Xxxxx 000
Xxxxxxx Xxxxx, XX 00000
Attn: Xxxxxxx X. Xxxxxx
Seller
XXXXXX REAL PROPERTY INVESTORS-FOUR, L.P.
c/x Xxxxxx Capital Corp., General Partner
000 X. Xxxxxxxx
Xxxxx 0000
Xx. Xxxxx, Xxxxxxxx 00000
Attn: Xxxxxxx X. Xxxxxx, Xx. Vice Chairman
14. At or prior to Closing Date, Seller shall deliver to
Purchaser original leases and whatever plans and specifications for the Property
are in Seller's possession. Copies of all such leases, plans and specifications
in Seller's possession shall be delivered to Seller within five (5) days after
the Acceptance Date.
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15. Purchaser may assign this Sale Contract at any time prior
to Closing, provided that Purchaser shall notify Seller in writing at least five
(5) days prior to Closing Date of the correct name and signature block of any
assignee of this Sale Contract. No assignment shall relieve Purchaser from any
of Purchaser's obligations hereunder.
16. If, for any reason, Closing hereunder is not consummated,
Purchaser shall promptly deliver to Seller copies of Purchaser's physical
inspection report, environmental report, survey and title commitment.
17. The Property is being sold and transferred in "as is"
condition, without any warranties or representations except for those expressly
set forth in paragraph 7 of this Sale Contract which automatically lapse and
terminate at Closing and in the documents to be executed by Seller and delivered
to Purchaser at Closing, being the Special Warranty Deed. Notwithstanding any
past, present, or future disclosures, if any, of Seller or of Seller's books and
records, Purchaser shall be conclusively deemed to have relied solely on the
independent investigations, examinations, and business judgment of Purchaser and
Purchaser's advisers and consultants, and not upon any representation or
warranties of Seller (except those in the Special Warranty Deed).
18. Seller shall not enter into any new leases affecting the
Property nor shall Seller modify or extend any existing leases affecting the
Property between the date hereof and Closing Date, without the prior written
consent of Purchaser, provided that Seller may, without consent of Purchaser,
extend existing leases for up to one (1) year beyond Closing (including renewal
terms, if any) and enter into new leases to extend no more than one (1) year
beyond Closing (including renewal terms, if any) in accordance with the rent
Schedule attached hereto as Exhibit I, and incorporated herein by reference.
Said new leases and modified leases shall be assigned to Purchaser and assumed
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by Purchaser pursuant to the Assignment of Leases attached hereto as Exhibit D.
Seller shall not enter into any new service contracts affecting the Property nor
shall Seller modify or extend any existing service contracts affecting the
Property between the date hereof and the Closing Date without the prior written
consent of Purchaser, provided that Seller may extend existing Service Contracts
and enter into new contracts if not more than one (1) year from Closing in a
commercially reasonable manner and said new and extended Service Contracts shall
be assigned to Purchaser and assumed by Purchaser pursuant to the Assignment for
Contracts attached hereto as Exhibit E.
19. In the event that all or any substantial portion of the
Property becomes subject to an appropriation proceeding or bona fide threat
thereof by an authority having power of eminent domain, Seller shall promptly
notify Purchaser thereof in writing. In such event, within five (5) business
days of receipt of Seller's notice, Purchaser shall (a) elect to terminate this
Sale Contract, in which event Purchaser shall be entitled to the return of all
non-refundable Xxxxxxx Money or (b) elect to proceed with the transaction, in
which event Purchaser shall be entitled to the proceeds of any award or payment
in lieu thereof resulting from such proceedings or threat thereof and Seller
shall execute and deliver to Purchaser at Closing an assignment of all of
Seller's interest in such proceeds, subject to the terms and provisions of the
leases described in Exhibit B hereto. Failure to give a notice shall be deemed
an election to proceed with the transaction.
20. In the event of any casualty damage to the Property prior
to Closing Date, which Seller does not repair prior to Closing Date, Purchaser
may, at Purchaser's option, terminate this Sale Contract, or proceed with
Closing. In the event of termination, all non-refundable Xxxxxxx Money shall be
returned to Purchaser and neither party shall have any further rights or
obligations hereunder. In the event of Closing, all insurance proceeds shall be
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assigned to Purchaser. In the event of any such casualty damage, Seller shall
have the right, at Seller's option but only with Purchaser's consent, to extend
the Closing Date for up to ninety (90) days in order to repair the casualty
damage.
21. Anything herein to the contrary notwithstanding, Seller's
obligation to close hereunder is contingent upon a simultaneous Closing
occurring under a certain Sale Contract of even date herewith between Purchaser
and Seller providing for the purchase and sale of the Cobblestone Court. If for
any reason other than Seller's breach of contract, said Closing does not occur
simultaneously with Closing hereunder, Seller may, at Seller's option, terminate
this Sale Contract by giving written notice of termination to Purchaser, in
which event, all Xxxxxxx Money shall be returned to Purchaser and neither party
shall have any further rights or obligations hereunder.
22. In the event that as of Closing Date, there is an action
pending to enjoin this transaction, then neither party shall be obligated to
close while such action is pending, and if Closing is delayed by reason of such
action for more than ten (10) days, then in such event either party may
terminate this Sale Contract by giving written notice of termination to the
other party, in which event all Xxxxxxx Money shall be returned to Purchaser,
and neither party shall have any further rights or obligations hereunder.
23. This Sale Contract may be executed in counterparts and
facsimile signatures shall constitute genuine signatures for purposes of this
Sale Contract.
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IN WITNESS WHEREOF, Purchaser and Seller have executed this
Sale Contract, or caused this Sale Contract to be executed by their officers
thereunto duly authorized, as of the day and year first above written.
AMERICAN SPECTRUM REALTY, INC.
(a Maryland corporation)
by /s/ Xxxxxx X. Xxxxxxx
-------------------------
Xxxxxx X. Xxxxxxx
President
Purchaser
XXXXXX REAL PROPERTY INVESTORS-FOUR, L.P.
(a Missouri limited partnership)
by XXXXXX CAPITAL CORP.
(a Missouri corporation)
General Partner
by /s/ Xxxxxxx X. Xxxxxx, Xx.
--------------------------
Xxxxxxx X. Xxxxxx, Xx.
Vice Chairman
Seller
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