Real Estate Contract (2006)Full Document 

Start of Preview
REAL ESTATE CONTRACT This Contract is entered into by and between Elecsys Corporation, a Kansas corporation ("Buyer"), and Rose Construction Company, a Kansas corporation ("Seller") effective as of the "Effective Date," which is hereby defined as the last date upon which both Buyer and Seller have executed this Contract. 1. Purchase and Sale. Seller hereby agrees to sell and convey and Buyer agrees to purchase the real property comprised of approximately 5 acres of land legally described on Exhibit A attached hereto and incorporated herein, and all improvements to be constructed thereon consisting primarily of an approximately 60,100 sq. foot single story building made primarily of pre-cast concrete and glass (the "Building") (the Building and all appurtenant parking areas, infrastructure and other improvements are hereinafter collectively referred to as the "Improvements"), together with all and singular the rights and appurtenances pertaining to the property, and all right, title and interest of Seller in and to parking, adjacent streets, easements, gaps and gores, appurtenances and rights of way relating to such real estate (collectively, the "Property"). 2. Purchase Price. Subject to Sections 5(e), 5(g), and 8(e) below, the Purchase Price for the Property shall be (a) Four Million Three Hundred Eighty Six Thousand and 00/100 Dollars ($4,386,000.00), and (b) the aggregate construction interest owed on the Construction Financing for the period prior to the "Target Date" (defined in Section 5(a) below), which shall be paid in cash or by wire transfer at "Closing" (defined in Section 9 below). 3. Entry on Property. Buyer, its agents, employees, and representatives, are hereby granted the right to immediately enter upon all or any portion of the Property for the purpose of making any structural, mechanical, engineering, geological, ecological, environmental, soil, surveying, or other inspections, tests, or work as Buyer, in its discretion, may deem necessary or appropriate. Buyer shall give advance written notice to Seller prior to entering the Property. Buyer agrees to indemnify and hold Seller harmless from all liabilities, damages and claims arising out of injury to persons or property as a result of Buyer's inspections and entry onto the Property pursuant to this Section 3. 4. Seller's Deliveries. Seller shall within ten (10) days from the date this Contract is executed by Buyer, at Seller's expense, deliver to Buyer legible, accurate and complete copies of any and all documents and agreements relating to the Property which are in Seller's possession or control, including, without limitation, the following (together, the "Seller's Deliveries"): a current standard form ALTA Owner's Title Commitment ("Title Commitment") covering the Property and issued by Kansas Title, as agent for First American Title Insurance Company (the "Title Company"), along with copies of all documents referred to as exceptions therein; a current ALTA/ASCM survey of the Property (the "Survey"); any existing environmental study or report; any existing soil reports; and building permits. 5. Construction; Construction Financing. (a) Seller shall construct the Improvements at its expense in accordance with the "Approved Plans and Specifications" attached hereto as Exhibit B and incorporated herein,
any "Approved Change Orders" (defined in Section 5(e) below), and all governing laws and codes. Without limiting the foregoing, Seller shall be responsible for any and all impact or tap-in fees, municipal charges and assessments, and permit fees relating to the construction or occupancy of the Improvements. Seller shall use only contractors and subcontractors approved in writing by Buyer, such approval not to be unreasonably withheld. Seller shall use reasonable efforts to complete such construction on or before August 21, 2006 (the "Target Date"). (b) This section intentionally deleted. (c) Seller shall keep Buyer apprised of the ongoing status of construction, and shall promptly furnish to Buyer copies of all material documents relating to the Property and construction of the Improvements generated or obtained by or for Seller. Upon completion of construction, Seller shall deliver to Buyer the following items (together, "Seller's Post-Construction Deliveries"): architectural reports and reviews (including, without limitation, an AIA certificate from Seller's architect certifying that the Improvements were constructed in substantial accordance with the Approved Plans and Specifications, as modified by any Approved Change Orders, and laws and codes; an updated "as built" survey; unconditional lien waivers from all contractors, subcontractors, and suppliers of materials, "as-built" plans and specifications, any engineering reports, and a temporary or permanent certificate of occupancy. (d) Buyer and Seller and their respective agents and consultants shall conduct a walk through of the Improvements on or before substantial completion thereof, and Buyer shall submit a list of any incomplete items to Seller within ten (10) days of the date thereof. Seller shall promptly cure such punch-list items. (e) If on one or more occasions following execution of this Contract, Buyer requests that Seller deviate from the Approved Plans and Specifications (a "Requested Change Order"), Seller shall incorporate the Requested Change Order into the Improvements, and, subject to the terms of this Section 5(e), the Purchase Price at Closing shall be increased by the cost of the Requested Change Order. If any Requested Change Order individually or in the aggregate would cause an increase in the cost of construction of more than $10,000.00, Seller shall notify Buyer in writing within five (5) business days of the request for the Requested Change Order of the cost of the Requested Change Order and Buyer has three (3) business days to elect to withdraw such request. Any Requested Change Order proposed by Buyer and not withdrawn by Buyer shall be an "Approved Change Order". If Seller fails to timely notify Buyer of the cost of any Requested Change Order as required herein, the Purchase Price shall not be increased to reflect such cost. (f) Seller shall and hereby does warrant the good and complete performance of its construction obligations hereunder, and shall indemnify and hold Buyer harmless from and against all costs, expenses, claims, damages, demands and liabilities relating to the Property which accrue or arise prior to the Closing Date, or accrue or arise at any time arising out of Seller's failure to perform (or cause to be performed) Seller's construction obligations as set forth herein. Without limiting the foregoing, Seller shall cure all labor and material defects in the Improvements of which Seller has written notice prior to one year after the Closing Date. Nothing set forth herein shall limit any claim against Seller arising from the negligent performance of its construction obligations. 2
(g) Seller shall obtain and be solely responsible for any financing required to construct the Improvements (the "Construction Financing"); provided, however, Buyer(s) agrees to guarantee that portion of the Construction Financing that does not exceed the Purchase Price so long as (i) Buyer has approved in writing in advance the amount financed, interest rate, and other terms of the Construction Financing, and Seller accepts or agrees to no modifications thereof without Buyer's prior written consent; (ii) any amount Buyer is required to pay under said guaranty shall (A) constitute a debt from Seller to Buyer in such amount, which contingent debt and the Seller's obligations under this Contract shall be secured by a mortgage in favor of Buyer in the form attached hereto as Exhibit C (the "Mortgage") to be recorded against the Property (all costs of such recording shall be borne by Seller) on the Effective Date, and (B) at Closing, in lieu of the foregoing debt described in (A), cause a reduction in the Purchase Price at Closing; and (iii) the guaranty shall be released at Closing. Buyer and Seller acknowledge and agree that the Mortgage shall be junior to any mortgage securing the Construction Financing, but to no other lien or security instrument. (h) All obligations of this Section 5 shall survive Closing. 6. Title Insurance. Buyer shall deliver to Seller its written objections to any matters shown or indicated in the Title Commitment, exception documents, or the Survey, within thirty (30) days after receipt of all of said items. Seller shall have until Closing to remove all such defects or objections to Buyer's reasonable satisfaction. In the event Seller is unable to cure or remove such objections to Buyer's reasonable satisfaction prior to or at Closing, Buyer may, at its option, terminate this Contract, waive its objections and proceed to Closing, or delay Closing until Seller has cured such objections. Effective as of the date and time of recording of the Deed (as defined below), there shall be issued to Buyer by the Title Company, an ALTA Owner's Title Insurance Policy (the "Title Policy") in the amount of the Purchase Price. The Title Policy shall insure good and marketable fee simple title to the Property in favor of Buyer. The Title Policy shall contain as exceptions to title only those matters approved or waived by Buyer ("Permitted Exceptions"). The Title Policy shall not have any exceptions for mechanics or material liens, survey matters or the Construction Financing. The costs and expenses of the Title Commitment, Title Policy, and the surveys shall be borne by Seller. 7. Conditions Precedent. In addition to Seller's performance of its obligations under this Contract, including the delivery of all documents at Closing, Buyer's obligation to purchase the Property is subject to Buyer's satisfaction in its sole discretion with the Property in all respects, including, without limitation, the physical condition of the Property, the Seller's Deliveries, the economic viability of the Property, and any other matters pertaining to the Property within forty-five (45) days after the Effective Date (the "Due Diligence Period"). If Buyer deems this condition to be unsatisfied, Buyer may, at its option, terminate this Contract by written notice
End of Preview