Exhibit 10
SALES AGREEMENT
THIS AGREEMENT is made and entered
into as of the day of March 2005,
by and between ROWE PROPERTIES, INC, a Virginia corporation
(hereinafter “Seller”) and HASH INVESTMENTS, LLC. a
Virginia Limited Liability Company (hereinafter
“Purchaser”).
RECITALS
WHEREAS, Seller is the owner of
certain real property and improvements thereon located in the Town
of Christiansburg, Virginia consisting of approximately 37 acres
more or less, including two (2) buildings, having a street address
of 405 & 406 Cambria Street, Christiansburg, Virginia, and
shown on
County Tax Map as Tax Parcels 465-A-3A, 466-A-1,2 (hereinafter the
“ Property ”). The Property is more particularly
described on Exhibit A attached ) ;
and
WHEREAS, Purchaser desires to
purchase from the Seller, and the Seller desires to sell to
Purchaser, the Property, together with all rights appurtenant
thereto and all benefits belonging, including Miscellaneous Rights
(as herein defined) and entitlements to development of the Property
granted by governmental or quasi-governmental bodies or entities
having jurisdiction or authority over the Property for the
development, construction and operation of a residential community
and related site improvements (collectively, being referred to as
the “ Project ”) in accordance with and subject
to the terms and conditions set forth herein, and
WHEREAS, Purchaser desires to
purchase the Property on the terms and subject to the conditions
set forth herein; and
NOW, THEREFORE, in consideration of
the foregoing recitals, the mutual promises hereinafter set forth,
and of other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties agree as
follows:
1. Definitions .
For all purposes of this Agreement,
the following terms shall have the respective meanings set forth
below:
(a) “Bankruptcy Code”
shall have the meaning ascribed to it in Paragraph 20.
(b) “Closing Date” shall
mean the date of Closing provided for in Paragraph 10; and
“Closing” shall be described in Paragraph 10 of this
Agreement.
(c) “Deposit” shall mean
the sums in cashier’s or certified checks, or wire transfers,
paid by Purchaser to the Escrow Agent, or the Seller, pursuant to
Paragraph 4 (a).
(d) “Escrow Agent” shall
mean the national title company chosen by Purchaser, and approved
by Seller, which the parties stipulate to be
.
(e) “Insolvency Laws”
shall have the meaning ascribed to it in Paragraph 20.
(f) “Outside Date” shall
mean the day by which all conditions to Closing must be satisfied
or waived which shall be the later to occur of: (i) one hundred
thirty (130) days following the Ratification Date or (ii) July 31,
2005.
(g) “Re-zoning Phase”
shall mean the period of time after the Ratification Date that
Purchaser shall be afforded to apply for and secure all applicable
governmental approvals for residential use of the
Property.
(h) “Permitted
Exceptions” shall mean (i) any preprinted exceptions to title
appearing on any title insurance commitment (other than those
typically deleted by appropriate Owner’s affidavit); (ii)
such liens, defects or encumbrances on the Property as would be
disclosed by an examination of title, and of which Purchaser has
advised Seller in writing prior to thirty (30) days after the date
of full ratification of this Agreement (which exceptions will not
result in an inability of the Seller to convey good marketable
title to Purchaser nor preclude Purchaser, in Purchaser’s
reasonable judgment, from developing the Property for residential
use); (iii) those easements or encumbrances required by
governmental agencies and agreed to by the Seller and Purchaser
and/or (iv).any and all leases respecting the Property. The term
Permitted Exceptions shall also mean and include (i) the lien of
real estate taxes not yet due and payable, (ii) all matters
revealed in the Title Commitment to be obtained by Purchaser which
are expressly approved or deemed approved by Purchaser, (iii) all
building, zoning, and other state, county or federal laws, codes
and regulations (whether existing or proposed) affecting the
Property, including all proffers relating to the zoning of the
Property and (iv) any title exception created directly or
indirectly by any act or omission of Purchaser or its
representatives, agents, employees or invitees.
(i) “Purchase Price”
shall mean Two Million Dollars ($2,000,000.00)
(j) “Ratification Date”
shall mean the date the Seller and Purchaser execute this Agreement
and shall commence the beginning of the “Study
Period”.
(k) “Study Period” shall
have the meaning ascribed to it as set forth in Paragraph 5
(a).
2. Purchase and Sale of
Property .
(a) On the Closing Date, and subject
to the terms and conditions of this Agreement, Seller agrees to
sell and convey, or cause to be conveyed, and Purchaser agrees to
purchase, the Property. The Property shall be sold and conveyed to
Purchaser free and clear of all liens, encumbrances, easements,
covenants, conditions, leases, and other matters affecting title,
except for the Permitted Exceptions.
(b) Purchaser shall obtain from a
nationally recognized title insurer reasonably acceptable to
Seller, and deliver a copy thereof to Seller, a commitment of
title
insurance for the Property (the “ Title
Commitment ”). Purchaser shall have the right to object
to any exceptions contained in the Title Commitment, by giving
written notice to Seller and the Title Company prior to the
expiration of the Study Period, stating the matters to which
Purchaser objects and the reasons therefore (“ Title
Objections ”), which shall in no event include Permitted
Exceptions. If Purchaser fails to notify Seller of any Title
Objections on or before the expiration of the Study Period, then
Purchaser shall be deemed to have approved all matters affecting
title to the Property set forth in the Title Commitment. If
Purchaser timely gives notice of Title Objections, and if Seller
agrees to cure any such matter, then Seller shall have until the
Closing Date to cure such objections or exceptions to
Purchaser’s satisfaction. If Seller fails or is unable to
cure such obligations or exceptions to Purchaser’s
satisfaction, Purchaser may: (i) waive such objection and, subject
to other conditions being satisfied or waived, proceed to Closing
or (ii) terminate this Agreement by providing written notice of
such waiver or termination to Seller, whereupon Purchaser shall, as
its sole and exclusive remedy, receive the return of the Deposit in
accordance with this Agreement and the Escrow Agreement.
(c) Seller agrees that, after the
Closing Date it will, at any time and from time to time after the
Closing Date, upon request of Purchaser, do, execute, acknowledge
or deliver, or will cause to be done, executed, acknowledged or
delivered, all such further acts, deeds, conveyances, and
assurances as may reasonably be required for better conveying,
transferring, assuring and confirming the Property to the
Purchaser.
3. Terms of Payment
.
On the Closing Date, Purchaser shall
pay to Seller the Purchase Price by cashier’s check or
certified check, or by wire transfer. The full amounts of Deposit,
as is delivered to Seller pursuant to Paragraph 4(a) below, shall
be credited toward the Purchase Price at the time of
Closing.
4. Deposit(s) .
(a) Purchaser shall deliver to the
Escrow Agent within three (3) days of the Ratification Date the sum
of Forty Thousand Dollars ($40,000.00) in immediately available
funds as a Deposit against the Purchase Price and other obligations
of Seller hereunder. Prior to making the Deposit, Seller, Purchaser
and Escrow Agent shall enter into an escrow agreement substantially
in the form attached as Exhibit B (the
“Escrow Agreement”). The Escrow Agent shall deposit any
funds he receives into an interest bearing account(s) with a
federally insured national bank or other financial institution
acceptable to Seller and Purchaser and shall provide Seller and
Purchaser with a copy of all deposited slips within forty-eight
(48) hours after issuance thereof. Escrow Agent shall hold the
Deposit in accordance with the terms of this Agreement and the
Escrow Agreement. In the event Purchaser fails to deliver the
Deposit in accordance with this Agreement and the Escrow Agreement,
Seller may treat the same as a default by Purchaser of this
Agreement entitling Seller to, in addition to other rights and
remedies, terminate this Agreement by written notice to
Purchaser.
(b) In the event Purchaser does not
timely elect to terminate this Agreement pursuant to Paragraph 6(a)
below, the entire Deposit(s), and any interest accrued thereon,
shall
be delivered by the Escrow Agent to the Seller
on the ninety first day (91st) day after the Ratification Date of
this Agreement, and the entire Deposit and any interest accrued
thereon shall thereafter be non-refundable except where this
agreement expressly provides otherwise or upon Seller’s
default hereunder.
5. Study Period .
(a) At anytime or times until one
hundred twenty (120) days after the Ratification Date of this
Agreement (hereinafter the “ Study Period ”),
Purchaser and/or its agents and representatives shall, at
Purchaser’s sole risk and expense, and subject to the terms,
conditions and restrictions of Paragraph 5(b) below, have the right
to enter upon the Property for purposes of conducting such surveys
and engineering tests, including test borings, inspections,
investigations, and/or studies as Purchaser deems necessary or
desirable in order to determine whether the Property is suitable
for Purchaser’s intended use thereof. Purchaser agrees to
furnish Seller, at no expense to the Seller, with two (2) copies of
all results, reports, drawings, etc. of the above within three (3)
days after they are received by the Purchaser and, to the extent
assignable, Purchaser shall assign to Seller all of
Purchaser’s right, title, and interest in and to such copies
and the information they contain, effective upon termination of
this Agreement for any reason other than Seller’s default
hereunder. In addition, Purchaser may conduct such architectural,
economic, and other studies of the Property, as Purchaser may deem
desirable including those respecting zoning and other matters that
may affect the Project and/or the use of the Property for
residential development.
In the event that Purchaser
determines, in its sole discretion, that the Property is not
suitable for Purchaser’s intended use thereof, then Purchaser
may terminate this Agreement by delivery of written notice thereof
to Seller on or before the end of the Study Period, and the
Deposit, including any interest accrued thereon, shall be refunded
in its entirety to Purchaser. If Purchaser fails to timely deliver
notice of termination prior to the expiration of the Study Period,
Purchaser shall be deemed to have accepted the condition of the
Property and waived any right of termination absent a default by
Seller of its obligation to deliver good and marketable title at
Closing. Purchaser recognizes that time is of the essence with
respect to its rights and obligations under this Agreement,
including its right to terminate during the Study Period, and that
upon failure to exercise its right to terminate during the Study
Period, the Deposit shall be deemed non-refundable and shall be
paid over to Seller in accordance with Paragraph 4(b) and the
Escrow Agreement.
(b) Purchaser and Seller shall
develop and jointly approve a plan to permit an orderly and
comprehensive test boring analysis to be conducted at the Property
by Purchaser, at Purchaser’s cost. Such plan also shall
detail the extent of permissible tree removal. Subject to the
provisions of such plan, (i) Purchaser shall promptly restore any
damage to the Property caused by Purchaser’s tests or studies
of the Property upon the occurrence of such damage, and return the
Property to its prior condition, and (ii) Purchaser shall
indemnify, defend and hold harmless Seller from and against any and
all costs (including reasonable attorneys’ fees and costs),
damages and liabilities, causes of action, or threats thereof,
incurred by or asserted against Seller as a result of the access to
or entry upon the Property by Purchaser, its agents, employees, or
contractors, including, without limitation, claims for personal
injury, property damage, and
services rendered or materials furnished to or
for the account of Purchaser. Notwithstanding anything set forth to
the contrary in this Agreement, Purchaser’s restoration and
indemnification obligations as set forth in this Section shall
survive termination or Closing. Purchaser is expressly prohibited
from conducting an environmental study of the Property beyond the
scope of a Phase I environmental study without the prior written
consent of Seller, unless the Phase I study indicates the possible
presence of environmental issues, in which case, Purchaser shall
have the right, subject to its obligations and the conditions under
this Paragraph 5(a), to conduct such additional environmental
studies as Purchaser deems warranted.
(c) If this Agreement is terminated
for any reason whatsoever, other than default by Seller hereunder,
Purchaser agrees to deliver to Seller, upon request and without
charge, copies of any additional test borings, studies, engineering
data, drawings, surveys, title reports, etc. prepared by Purchaser,
or its agents, subsequent to the date of this Agreement, and to the
extent assignable, this data shall then become the property of
Seller.
(d) Purchaser acknowledges that
Purchaser will have independently and personally inspected the
Property and that Purchaser has entered into this Agreement based
upon its ability to make such examination and inspection. The
Property is to be sold to and accepted by Purchaser at Closing in
its then present condition, “AS IS, WITH ALL FAULTS, AND
WITHOUT ANY REPRESENTATION OR WARRANTIES BY SELLER TO PURCHASER OF
ANY KIND WHATSOEVER, EXPRESS OR IMPLIED,” (other than the
special warranty of title to be included in the Deed); including
specifically (without limiting the generality of the foregoing),
any representation or warranty of, as to or respecting: (i) the
soil conditions existing at the Property for any particular purpose
or developmental potential; (ii) the presence or absence of any
hazardous substances or matter in or on the Property; (iii)
compliance of the Property with any applicable laws, regulations or
other governmental requirements; (iv) the suitability of the
Property for the Project or any other purpose and (v) the accuracy
of any information provided by Seller to Purchaser (if any).
Purchaser further acknowledges that Seller’s willingness to
sell the Property to Purchaser at the Purchase Price stated in this
Agreement has been induced, in part, by the agreement of Purchaser
to purchase the Property “ as-is ”.
6. Additional Undertakings of
Seller .
(a) On the Closing Date, the Seller
agrees to execute, acknowledge, and deliver, or cause to be
executed, acknowledged, and delivered, to Purchaser a Special
Warranty Deed, in form attached as Exhibit C and in
proper form for recording, conveying the Property to Purchaser,
free and clear of all liens, encumbrances, covenants, conditions,
and other matters affecting title, except the Permitted
Exceptions.
(b) Seller agrees to give possession
and occupancy of the Property to Purchaser at the time of
Closi
