HomeMy WebLinkAboutAgenda - Mail Packet - 12/03/2024 - Urban Renewal Authority (URA) Agenda – December 2, 2024City of Fort Collins Page 1 of 2
Urban Renewal Authority Board
Agenda
December 2, 2024 at 5:00 PM
Jeni Arndt, Chair
Kristin Stephens, Vice Chair
Susan Gutowsky
Julie Pignataro
Tricia Canonico
Melanie Potyondy
Kelly Ohlson
Emily Francis
Kristen Draper
Dan Sapienza
Matt Schild
Council Information Center (CIC)
in City Hall, 300 Laporte Ave, Fort
Collins, CO and via Zoom at
https://zoom.us/j/98687657267
Cablecast on FCTV
Channel 14 on Connexion
Channel 14 and 881 on Comcast
Caitlin Quander Josh Birks Amani Chamberlin
URA Attorney Acting Executive Director Secretary
URBAN RENEWAL AUTHORITY BOARD MEETING
5:00 PM
A) CALL MEETING TO ORDER
B) ROLL CALL
C) AGENDA REVIEW
Executive Director's Review of Agenda.
D) PUBLIC PARTICIPATION
E) PUBLIC PARTICIPATION FOLLOW-UP
F) ADOPTION OF CONSENT CALENDAR
G) COMMISSIONER REPORTS
H) DISCUSSION ITEMS
The method of debate for discussion items is as follows:
• Chair introduces the item number and subject; asks if formal presentation will be
made by staff
• Staff and/or Applicant presentation (optional)
• Chair requests public comment on the item (three minute limit for each person)
• Board questions of staff on the item
• Board motion on the item
• Board discussion
• Final Board comments
• Board vote on the item
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Note: Time limits for individual agenda items may be revised, at the discretion of the Chair, to ensure
all have an opportunity to speak. If attending in person, please sign in at the table in the back of
the room. The timer will buzz when there are 30 seconds left and the light will turn yellow. It will buzz
again at the end of the speaker’s time.
1. Consideration of a motion to go into executive session to discuss the potential
purchase or acquisition of real property interests, to receive legal advice on specific
legal questions, and to determine positions relative to matters that may be subject to
negotiations related to property in the North College Urban Renewal Plan Area.
“I move that the Fort Collins Urban Renewal Authority go into executive session pursuant to:
C.R.S. § 24-6-402(4)(a), (b) and (e) for the purpose of discussing with the Authority’s attorneys
and appropriate management staff the following items, all related to property in the North
College Urban Renewal Plan Area:
• Potential Purchase or Acquisition of Real Property Interests,
• Specific Legal Advice on Specific Legal Questions, and
• Determine Positions Relative to Matters that may be Subject to Negotiations, Develop Strategy
for Negotiations and Instruct Negotiators.”
2. Items relating to the Consideration of Resolutions to Approve Purchase and Sale
Agreement for 1636 North College Avenue.
Resolution No. 137 to Authorizing The Acquisition of Property at 1636 N. College Ave.
Resolution No. 138 to Adopting a Supplemental 2024 Budget Resolution
Resolution No. 139 to Adopting a Supplemental 2025 Budget Resolution
The owner of the property located at 1636 North College Ave (Property) has signed a Purchase
and Sale Agreement (PSA) now before the URA Board of Commissioners for consideration. If the
Board agrees with the PSA terms, a resolution authorizing the URA Acting Executive Director to
sign the PSA on behalf of the URA as Buyer is presented for Board approval (Exhibit A). If t he
PSA is signed by the Acting Executive Director, the URA will then have certain rights to inspect
and purchase the Property per the terms of the PSA. The resolution does not require the URA to
purchase the Property.
I) OTHER BUSINESS
J) ADJOURNMENT
Upon request, the City of Fort Collins will provide language access services for individuals who have
limited English proficiency, or auxiliary aids and services for individuals with disabilities, to access
City services, programs and activities. Contact 970.221.6515 (V/TDD: Dial 711 for Relay Colorado)
for assistance. Please provide 48 hours advance notice when possible.
A petición, la Ciudad de Fort Collins proporcionará servicios de acceso a idiomas para personas que
no dominan el idioma inglés, o ayudas y servicios auxiliares para personas con discapacidad, para
que puedan acceder a los servicios, programas y actividades de la Ciudad. Para asistencia, llame al
970.221.6515 (V/TDD: Marque 711 para Relay Colorado). Por favor proporcione 48 horas de aviso
previo cuando sea posible.
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Urban Renewal Authority Agenda Item Summary – Page 1 of 3
December 2, 2024
AGENDA ITEM SUMMARY
Urban Renewal Authority
STAFF
Andy Smith, Redevelopment Manager
Josh Birks, Acting Executive Director
SUBJECT
Items relating to the Consideration of Resolutions to Approve Purchase and Sale Agreement for
1636 North College Avenue.
EXECUTIVE SUMMARY
Resolution No. 137 To Authorizing The Acquisition of Property at 1636 N. College Ave.
Resolution No. 138 To Adopting a Supplemental 2024 Budget Resolution
Resolution No. 139 To Adopting a Supplemental 2025 Budget Resolution
The owner of the property located at 1636 North College Ave (Property) has signed a Purchase and Sale
Agreement (PSA) now before the URA Board of Commissioners for consideration. If the Board agrees with
the PSA terms, a resolution authorizing the URA Acting Executive Director to sign the PSA on behalf of
the URA as Buyer is presented for Board approval (Exhibit A). If the PSA is signed by the Acting Executive
Director, the URA will then have certain rights to inspect and purchase the Property per the terms of the
PSA. The resolution does not require the URA to purchase the Property.
STAFF RECOMMENDATION
Staff recommend approval and adoption of the resolution.
BACKGROUND / DISCUSSION
Beginning in late 2022, the Fort Collins URA began discussions with the owner (Seller) of 1636 North
College Avenue regarding a potential sale of the Property to the URA. The Property is located within
the North College Plan Area, an urban renewal area created and approved by the City Council in 2004.
The intent of the URA in purchasing the Property would be to eliminate and prevent existing conditions
of blight in furtherance of the North College Plan goals.
In September 2023, a non-binding Letter of Interest (LOI) was signed by both parties, establishing
mutually acceptable terms to be incorporated in a formal PSA that would place the property “under
contract”. A draft PSA was circulated between the Fort Collins URA and the Seller, however it was not
mutually agreed upon or executed due to prolonged lease termination discussions between the Seller
and Albertson’s (Tenant).
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Urban Renewal Authority Agenda Item Summary – Page 2 of 3
On June 11, 2024, URA Staff conducted a visual survey of the Property and confirmed that blight
conditions remained present. On June 27, 2024, the URA Board authorized the use of eminent domain
to acquire the Property if ongoing negotiations were unsuccessful.
Throughout the summer and fall of 2024, URA staff and legal counsel continued negotiations with the
Seller while also continuing to take steps to acquire the Property with eminent domain if necessary.
According to the Seller, ongoing negotiations with their Tenant to terminate the lease appeared to be
coming to a mutually satisfactory agreement. In early November, the Seller notified URA staff that the
terms of a lease termination agreement have been mutually agreed upon by them and the Tenant, and
that final negotiations of a PSA with the URA could proceed in earnest.
After a few more rounds of negotiation, the Seller and URA staff agreed to terms of a PSA and the Seller
signed their portion of the PSA. That PSA is now before the URA Board for consideration.
Several key aspects of the PSA include:
Purchase price is $7,636,050.00, which is readily available in cash in the North College Urban
Renewal Plan Area fund. The URA may decide to pay cash or finance the purchase and has
sufficient time to consider options.
The URA has 180 days to inspect the property and conduct an assortment of due diligence activities.
During this period, the URA may further consider redevelopment and reuse strategies, partnerships,
disposition options, financing arrangements, and more.
The earnest money deposit is $250,000.00 which is readily available as cash in the North College
Urban Renewal Plan Area fund. The earnest money deposit is fully refundable until the expiration
of the due diligence period (180 days), yet applicable to the purchase price if the URA elects to close
on the transaction.
The Seller and Tenant have executed a Lease Termination Agreement that becomes effective upon
the successful closing of a purchase transaction by the URA.
The PSA does not require the URA to purchase the Property; it simply provides certain rights to
inspect and purchase the Property if so desired by the URA Board.
BOARD / COMMISSION / COMMITTEE RECOMMENDATION
None.
AUTHORITY FINANCIAL IMPACTS
The North College Urban Renewal Plan Area unencumbered fund balance is currently estimated to be
$8,296,753. URA finance staff estimates that approximately $2.4 million of additional unassigned
property tax increment revenue will be received in 2025.
To fund due diligence and inspection activities (and other technical projects), the URA Board authorized
$180,000 in 2024, and $260,000 in 2025 for technical services. URA staff believe this total budget to be
sufficient to evaluate the Property and make corresponding plans prior to the expiration of the PSA’s
due diligence provision.
Two resolutions are attached for consideration by the URA Board. The first resolution (Exhibit C)
approves a supplemental budget appropriation in the 2024 calendar year to fund the refundable earnest
money deposit of $250,000. The second resolution (Exhibit D) approves a supplemental budget
appropriation in the 2025 calendar year to fund the potential acquisition of the Property for $7,636,050
(less the earnest money deposit of $250,000).
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Urban Renewal Authority Agenda Item Summary – Page 3 of 3
PUBLIC OUTREACH
A series of outreach workshops conducted by the CSU Institute for the Built Environment and The
Family Center/La Familia in 2019 and 2020 to form the North Fort Collins Community Engagement
Report and the Community Investment Plan for North College.
Since those reports were completed, URA staff have provided updates and presentations to community
stakeholders including, but not limited to:
North Fort Collins Business Association
The Family Center/La Familia
The United Way of Larimer County
Fort Collins Area Chamber of Commerce - Local Legislative Affairs Committee
Citizens Advisory Group - North College Urban Renewal Plan Area
Urban Land Institute
ATTACHMENTS
1. Resolution A for Consideration
2. Exhibit to Resolution A
3. Resolution B for Consideration
4. Resolution C for Consideration
5. Presentation
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Section H, Item 2.
31818571.1
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RESOLUTION NO. 137
OF THE BOARD OF COMMISSIONERS OF THE FORT COLLINS
URBAN RENEWAL AUTHORITY AUTHORIZING THE ACQUISITION OF PROPERTY
AT 1636 N. COLLEGE AVE.
WHEREAS, the Fort Collins Urban Renewal Authority (the “Authority”) was established
in 1982 under and in accordance with the Colorado Revised Statutes (“C.R.S.”) § 31-25-101, et
seq. (the “Urban Renewal Law”); and
WHEREAS, the City Council of the City of Fort Collins, Co lorado (the “City”), by
Resolution No. 2004-152 approved and adopted on December 21, 2004, the “North College
Urban Renewal Plan” (the “North College Plan”) as an urban renewal plan under the Urban
Renewal Law for the area described therein (the “North College Plan Area”); and
WHEREAS, at the time the North College Plan was adopted, the real property located
within North College Plan Area was found, determined and declared to be a blighted area as
defined in the Urban Renewal Law (the “Blight Determination”); and
WHEREAS, on June 11, 2024 Authority staff performed a “Condition Survey Update –
1636 N College Ave”, which confirmed the findings made by City Council in connection with
the Blight Determination with respect to the Property (defined below); and
WHEREAS, the North College Plan provides for the Authority to exercise all powers
authorized under the Urban Renewal Law, including the Authority’s acquisition of real property
located within the North College Plan Area; and
WHEREAS, based on community feedback and continued and growing issues of blight,
the Authority determined it should acquire the property located at 1636 N. College Ave. (the
“Property”), which Property is located within the North College Plan Area; and
WHEREAS, the Authority has determined that the acquisition of the Property is in the
public interest and will further the goals of the North College Plan and the purpose of the
Authority to eliminate and prevent blight; and
WHEREAS, in addition to the direct purposes of eliminating blight and preventing injury
to the public health, safety, morals and welfare of the residents of the City, redevelopment of the
Property within the boundaries of the North College Plan Area is expected to provide substantial
direct and indirect benefits to the City, its citizens and the surrounding region and enhance the
economic vitality of the City in numerous ways, including but not limited to the creation and
retention of new temporary and permanent jobs; by increasing the City’s employment base; by
supporting the redevelopment of the former grocery store space; by generating increased sales
tax, property tax, and other general revenue for the City; and by stimulating further economic
development in the City and surrounding region; and
WHEREAS the Authority is authorized in C.R.S. § 31-25-105(1)(b) to “make and
execute all contracts and other instruments which it may deem necessary or convenient to the
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exercise of its powers” and in C.R.S. § 31-25-105(1)(e) to “acquire any property by purchase”;
and
WHEREAS, on September 13, 2023, the Authority and DPC entered into a letter of intent
based on the parameters previously approved by the Authority Board and then negotiated a
purchase and sale agreement (“Purchase Agreement”); and
WHEREAS, the Authority Board has been presented with the negotiated Purchase
Agreement which is attached hereto as Exhibit A; and
WHEREAS, in compliance with the North College Plan, the Authority has evaluated and
considered other possible alternatives; and
WHEREAS, the Authority has determined there is an immediate need to acquire the
Property in order to implement the North College Plan, and that acquisition of the Property will
be in furtherance of a public purpose and public use.
NOW, THEREFORE, BE IT RESOLVED BY THE BOARD OF COMMISSIONERS
OF THE FORT COLLINS URBAN RENEWAL AUTHORITY:
Section 1. The foregoing Recitals are incorporated herein by this reference.
Section 2. The Authority has duly considered and hereby approves the Purchase
Agreement, including its exhibits, in substantially the form attached hereto, subject to technical
additions, deletions and variations as the legal counsel to the Authority may determine to be
necessary and appropriate to protect the interests of the Authority or to effectuate the purposes of
this Resolution.
Section 3. Upon successful finalization of the Purchase Agreement and approval as
to form by legal counsel to the Authority, the Acting Executive Director is hereby authorized to
execute, and the Secretary to attest if necessary, the Purchase Agreement on behalf of the
Authority.
Section 4. The Acting Executive Director or his designee is hereby authorized and
directed to take all actions necessary for the Authority to comply with and effectuate the
Purchase Agreement and acquisition of the Property, including all actions identified in the
Purchase Agreement or any exhibit thereto that are not specifically designated as requiring
review, approval, or decision by the Authority or required by law to be performed by the
Authority.
Section 5. This Resolution shall be effective upon approval by the Authority.
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31818571.1
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Passed and adopted at a regular meeting of the Board of Commissioners of the City of Fort
Collins Urban Renewal Authority this 2nd day of December, 2024.
FORT COLLINS URBAN RENEWAL
AUTHORITY
_________________________________
Chair
ATTEST:
_____________________________
Secretary
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EXHIBIT A
AGREEMENT OF PURCHASE AND SALE
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Section H, Item 2.
AGREEMENT OF PURCHASE AND SALE
(RI# 8457, 1636 N. College Ave., Fort Collins, CO)
THIS AGREEMENT OF PURCHASE AND SALE (this “Agreement”) is dated as of
_______________, 2024 (the “Effective Date”) between VEREIT REAL ESTATE, L.P., a
Delaware limited partnership, as seller (“Seller”), and the FORT COLLINS URBAN RENEWAL
AUTHORITY, a body corporate duly organized and existing as an urban renewal authority under
the laws of the state of Colorado, as buyer (“Buyer”).
RECITALS
Buyer desires to purchase the Property (as defined below) from Seller and Seller desires
to sell the Property to Buyer, all as more particularly set forth in this Agreement. The Property is
improved and is currently leased to Albertson’s LLC, a Delaware limited liability company (the
“Tenant”) under a lease (including any amendments thereto, the “Lease”), but that Lease is
intended to be terminated by Seller and thus no longer be in effect at the time of the closing of
the purchase and sale under this Agreement.
AGREEMENT
In consideration of the payments and mutual covenants and undertakings set forth in this
Agreement, and for other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, Seller and Buyer (each a “Party” and collectively the “Parties”) agree
as follows:
SUMMARY OF TERMS
Certain key terms of this Agreement are summarized below, but remain subject to the applicable
detailed provisions set forth elsewhere in this Agreement.
Property: Seller’s interest in the property located at 1636 N. College Ave., Fort
Collins, CO, as legally described on Exhibit A attached hereto.
Purchase Price: $7,636,050.00
First Deposit: $250,000.00
Second Deposit: $100,000.00
Diligence Period: One Hundred Eighty (180) days, beginning on and including the
Effective Date.
Closing Date: Thirty-five (35) days after the end of the Diligence Period.
Escrow Agent: First American Title Insurance Company
National Commercial Services
2555 E. Camelback Road, Suite 350
Phoenix, AZ 85016
Attention: Lesa Ferris
Phone: (602) 567-8129
Email: leferris@firstam.com
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Agreement of Purchase and Sale
RI# 8457, Fort Collins, CO
Notices Addresses for the Parties:
If to Buyer: FORT COLLINS URBAN RENEWAL AUTHORITY
c/o City of Fort Collins
281 North College Avenue
Fort Collins CO 80522
Attn: Andy Smith, Redevelopment Manager
Phone: (970) 416-2517
Email: asmith@fcgov.com
with a copy to: Brownstein Hyatt Farber Schreck LLP
675 15th Street, Suite 2900
Denver CO 80202
Attn: Caitlin Quander, Esq.
Phone: (303) 223-1233
Email: cquander@bhfs.com
If to Seller: VEREIT REAL ESTATE, L.P.
c/o Realty Income Corporation
11995 El Camino Real
San Diego, CA 92130
Attn: Daniel Haug, Esq., Kristina Gasperino, and
Lauren Doyle (RI #8457)
Phone: (602) 778-6000
Email: dhaug@realtyincome.com
Email: kgasperino@realtyincome.com
Email: ldoyle@realtyincome.com
Notice Provisions: See Section 7.1.
Seller’s Broker: None
Buyer’s Broker: None
[Remainder of page intentionally left blank]
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Section H, Item 2.
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Agreement of Purchase and Sale
RI# 8457, Fort Collins, CO
DEFINITIONS
In addition to any other terms defined elsewhere in this Agreement, the following terms,
when used in this Agreement with a capital letter, have the meanings set forth below:
“Affiliate” means, with respect to a Person, any other Person that directly, or indirectly
through one or more intermediaries, controls or is controlled by or is under common control with
such Person.
“Business Day” means any day other than a Saturday, a Sunday, or a federal holiday
recognized by the Federal Reserve Bank of New York.
“Buyer Party” means Buyer, its Affiliates, any Permitted Assignee, any Lender, and any
of their respective officers, employees, partners, members, agents, attorneys, consultants,
contractors, advisors, and other representatives, and their respective heirs, successors, personal
representatives, and assigns, each being a “Buyer Party” and collectively being the “Buyer
Parties.”
“Claim Notice” means a written notice delivered by one Party to the other Party setting
forth a reasonably detailed description of the specific Claims being asserted, including without
limitation detailed statements of (a) the amount of loss or damage being asserted, and (b) the
rationale for or explanation of why the Claims are alleged to be the responsibility of the Party
against whom the Claims are being asserted.
“Claims” means any suits, actions, proceedings, investigations, demands, claims,
liabilities, fines, penalties, liens, judgments, losses, injuries, damages, expenses, or costs,
including without limitation attorneys’ and experts’ fees and costs and investigation, remediation
costs, losses due to impairment or diminished value, or any other damages, losses or costs of
any type or kind.
“Closing” means the consummation of the purchase and sale transaction contemplated
by this Agreement.
“Closing Date” means the date that is set forth or described as such in the Summary of
Terms, as such date may later be changed as expressly provided in this Agreement.
“Closing Documents” means the documents, instruments (including, without limitation,
any deeds or assignments), and other agreements executed and delivered by a Party at or in
connection with the Closing.
“Code” means the Internal Revenue Code of 1986, as amended, or any corresponding
provision(s) of any succeeding law.
“Confidential Information” means all information that is confidential, proprietary, or
otherwise not generally available to the public and that is either (a) furnished by or on behalf of
Seller to Buyer or any Buyer Parties, or (b) is developed, discovered, determined, or otherwise
made known to or by Buyer or any Buyer Parties through, as a result of, or in connection with
Buyer’s due diligence investigations of and regarding the Property; and includes the contents and
provisions of this Agreement (including without limitation the amount of consideration being paid
by Buyer for the Property) but does not include material or information that was or becomes known
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Agreement of Purchase and Sale
RI# 8457, Fort Collins, CO
or available to Buyer, free of any other confidentiality obligations, outside of this Agreement or the
activities of Buyer and the Buyer Parties pursuant to this Agreement.
“Covenants and Declarations” means, collectively, the (i) Declaration of Covenants,
Conditions and Restrictions recorded September 24, 1991 at Reception No. 91046385, as
assigned by that Assignment of Declarant’s Interest recorded August 14, 1995 at Reception No.
95049258 and September 27, 1995 at Reception No. 95060362; (ii) Contract of Sale and
Development Agreement, by and between Zephyr Fort Collins, LP, a Colorado limited partnership
and Albertson's, Inc., a Delaware corporation, recorded October 18, 1994 under Reception No.
94084976 and re-recorded April 10, 1995 at Reception No. 95020105; (iii) Declaration of
Restrictions and Grant of Easements, by and between Zephyr Fort Collins, LP, a Colorado limited
partnership and Albertson's Inc., a Delaware corporation, recorded June 15, 1995 under
Reception No. 95033972 and First Amendment thereto recorded August 14, 1996 at Reception
No. 96059014 and Second Amendment recorded January 6, 2004 at Reception No. 20040001212
and Third Amendment recorded February 2, 2017 at Reception No. 20170007721; (iv) Common
Area Maintenance Agreement recorded June 15, 1995 at Reception No. 95033973 and First
Amendment thereto recorded August 14, 1996 at Reception No. 96059015 and Second
Amendment recorded January 6, 2004 at Reception No. 20040001211; and (v) Development
Agreement recorded June 15, 1995 under Reception No. 95033974 and First Amendment thereto
recorded August 14, 1996 under Reception No. 96059016.
“Deposit” means the sum of the First Deposit amount and the Second Deposit amount as
specified in the Summary of Terms; provided that any reference to a return or payment of the
Deposit to Buyer will be limited only to the extent such amounts have been deposited by Buyer
with Escrow Agent.
“Diligence Materials” means the documents and other materials and information
regarding the Property provided by or on behalf of Seller or any Seller Party to Buyer or any Buyer
Party to assist with Buyer’s evaluation and acquisition of the Property, including the Seller
Deliveries.
“Diligence Period” means the period beginning on the Effective Date and ending at 5:00
p.m. MST on the last day of the period described as such in the Summary of Terms.
“Escrow Agent” means the entity specified as such in the Summary of Terms.
“Escrow Instructions” means the escrow instructions attached as Exhibit E to, and
incorporated as a part of, this Agreement.
“First Deposit” means the amount of money specified as such in the Summary of Terms.
“Governmental Authority” means any federal, state, county or municipal government or
political subdivision; any governmental agency, authority, board, bureau, commission,
department, instrumentality, or public body; any court or administrative tribunal; or any Person
serving in an official or representative capacity for any of the foregoing.
“Hazardous Materials” means materials, wastes, or substances that are (a) regulated, or
classified as “hazardous substances,” “hazardous materials,” “toxic substances,” “toxic
pollutants,” “hazardous waste,” or like terms under federal, state or local environmental laws or
regulations; (b) petroleum products (other than as may be present at the Property in the ordinary
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Section H, Item 2.
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Agreement of Purchase and Sale
RI# 8457, Fort Collins, CO
course of its operation or business); (c) asbestos or asbestos-containing materials; (d) toxic mold
in quantities harmful to human health; or (e) polychlorinated biphenyls.
“Improvements” means all buildings, improvements and fixtures located on the Land.
“In-house Fees” means the reasonable fees and costs for and relating to the services of
in-house counsel and staff providing legal services to a Party or its Affiliates, which may be
charged based upon time spent at rates comparable to those charged by private practice lawyers
and staff of comparable experience practicing at offices of firms of regional size in the jurisdiction
in which the Property is located.
“Intangible Property” means, to the extent transferable, any intangible property owned
by Seller and relating solely and specifically to the Real Property, including any transferable
licenses, permits, approvals, certificates of occupancy, or entitlements.
“Land” means the parcel(s) of land described in Exhibit A attached hereto.
“Lender” means an institutional lender utilized by Buyer to provide financing in connection
with Buyer’s acquisition of the Property.
“Obligations Surviving Termination” means those provisions of this Agreement that
either expressly require conduct or performance following, or are expressly stated to survive, a
termination of this Agreement prior to Closing.
“Permitted Assignee” means any Affiliate of Buyer that has, or will at Closing have, the
ability to fully perform the obligations of Buyer under this Agreement.
“Person” means any individual, partnership, joint venture, corporation, trust, limited
liability company, unincorporated association, or other entity and any government or any
department or agency thereof, whether acting in an individual, fiduciary or other capacity.
“Personal Property” means all equipment, machinery, furnishings, and other tangible
personal property owned by Seller and located within or upon the Real Property, if any.
“Property” means all right, title and interest of Seller in and to the Real Property, the
Personal Property and the Intangible Property.
“Purchase Price” means the purchase price for the Property specified in the Summary of
Terms.
“Real Estate Taxes” means all real estate taxes and assessments applicable to the
Property, including all installments of special taxes or assessments.
“Real Property” means the Land, all rights, privileges and easements appurtenant to the
Land, and the Improvements.
“Restricted Person” means any Person, group, or nation that is (a) named by any
Executive Order, the United States Treasury Department, or other Governmental Authority as a
terrorist, “Prohibited Person” or “Specially Designated National and Blocked Person;” (b) named
as a Person, group, or nation that is banned, blocked, prohibited, or restricted pursuant to any
law that is enforced or administered by the Office of Foreign Assets Control; or (c) acting in
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Section H, Item 2.
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Agreement of Purchase and Sale
RI# 8457, Fort Collins, CO
violation of Executive Order No. 13224, the Patriot Act, or any other laws or regulations relating
to terrorism or money laundering.
“Second Deposit” means the amount of money specified as such in the Summary of
Terms.
“Seller Deliveries” means the information and documents listed on Schedule 1 attached
to this Agreement, to the extent in Seller’s possession and readily available to provide to Buyer.
“Seller Party” means Seller, its Affiliates, Seller’s property and asset managers, any
lender to Seller, the partners, trustees, shareholders, members, managers, controlling persons,
directors, officers, attorneys, employees and agents of each of them, and their respective heirs,
successors, personal representatives, and assigns, each being a “Seller Party” and collectively
being the “Seller Parties.”
“Survey” means, collectively, any existing survey of the Real Property included in the
Seller Deliveries and any new or updated survey of the Real Property obtained by Buyer.
“Title Company” means Escrow Agent when acting or referred to in its capacity as the
title insurance provider for this transaction.
ARTICLE 1
PURCHASE AND SALE OF THE PROPERTY
Section 1.1. Purchase and Sale. Subject to the provisions, terms, covenants and
conditions set forth in this Agreement, Seller agrees to sell to Buyer, and Buyer agrees to
purchase from Seller, all of Seller’s right, title and interest in and to the Property, but specifically
excluding any (a) rights to use any legal or trade names of Seller or any of Seller’s Affiliates in
any manner, and (b) insurance, indemnity, or other claims or rights of Seller under or with respect
to the Lease or the Property relating to Seller’s ownership of the Property prior to Closing.
Section 1.2. Purchase Price; Deposit. Buyer will pay the Purchase Price as described
in this Section. All payments will be made in immediately available funds delivered into escrow
with the Escrow Agent.
(a) Buyer will deliver the First Deposit within three (3) Business Days following the
Effective Date. Buyer will deliver the Second Deposit within three (3) Business Days after the
expiration of the Diligence Period. Escrow Agent will place the Deposit in a federally insured
account on behalf of Seller and Buyer. Buyer will instruct Escrow Agent whether Buyer elects to
have such account be interest-bearing. Any interest earned on the Deposit while it is held in
escrow will belong solely to Buyer and will be paid to Buyer regardless of the ultimate disposition
of the Deposit, and accordingly all references to the “Deposit” in this Agreement exclude any
interest that may be earned thereon.
(b) The Deposit will be applied as follows: (i) if Buyer terminates this Agreement when
Buyer is expressly entitled to do so as provided in this Agreement, the Deposit will be returned to
Buyer; (ii) if the Deposit is to be received by Seller as provided in this Agreement, the Deposit will
be paid to Seller; and (iii) if Closing occurs, the Deposit will be credited to Buyer and applied
against the Purchase Price paid to Seller at Closing.
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(c) Buyer will deliver the Purchase Price, as adjusted for the Deposit amount applied
thereto and any prorations, credits and adjustments to be made pursuant to the terms of this
Agreement, to Escrow Agent not later than the Closing Date, and the Purchase Price will be paid
to Seller at Closing.
Section 1.3. Escrow Instructions. This Agreement, including the Escrow Instructions,
will constitute the instructions for the Escrow Agent’s handling of the purchase and sale
transaction contemplated herein. The Seller and Buyer shall establish, within three (3) business
days after full execution of this Agreement, an escrow with Escrow Agent by depositing a draft of
this Agreement, including the Escrow Instructions, with Escrow Agent, and Escrow Agent is
hereby engaged to administer the escrow. By accepting this escrow, Escrow Agent agrees to the
terms of this Agreement as they relate to the duties of Escrow Agent. Seller and Buyer will execute
such supplemental escrow instructions as may reasonably be required by Escrow Agent to enable
Escrow Agent to comply with the terms of this Agreement. If any conflict exists between this
Agreement and the provisions of any supplemental escrow instructions, the terms of this
Agreement will control unless a contrary intent is expressly indicated in the supplemental
instructions and such supplemental instructions are signed by both Buyer and Seller.
ARTICLE 2
BUYER’S INVESTIGATIONS; AS-IS SALE
Section 2.1. Buyer’s Investigations.
(a) Not later than two (2) Business Days following the Escrow Agent’s receipt of the
First Deposit from Buyer, Seller will deliver to Buyer, or make available to Buyer by diligence
website or other electronic means to which Buyer has been given access, the Seller Deliveries.
Seller will have no obligation to deliver or disclose to Buyer any of Seller’s attorney-client
privileged materials, appraisals, internal memoranda, or internal evaluations of the Property.
Except as may be otherwise expressly set forth in this Agreement, Seller makes no
representations or warranties of any kind regarding the accuracy, thoroughness or completeness
of, or any conclusions drawn in, the information contained in the Seller Deliveries or any other
Diligence Materials.
(b) During the Diligence Period, Buyer will conduct such commercially reasonable,
non-invasive investigations, studies or tests of the Property as Buyer deems necessary to
determine whether Buyer desires to complete the acquisition of the Property including but not
limited to title review, property inspections, survey, soil testing, utilities, Hazardous Materials,
zoning, common area, restrictive covenants, planned community association declarations, and to
secure bonding financing, if applicable. Buyer, in its sole and absolute discretion and for any
reason or no reason whatsoever, may reject the Property by giving written notice of termination
to Seller and Escrow Agent (the “Termination Notice”) prior to the expiration of the Diligence
Period. If Buyer timely gives a Termination Notice, the Deposit will be returned to Buyer and this
Agreement and the rights and obligations of the Parties under this Agreement will terminate,
except for Obligations Surviving Termination. Alternately, Buyer may accept the Property by
giving written notice of acceptance to Seller and Escrow Agent (the “Acceptance Notice”) prior
to the expiration of the Diligence Period. If Buyer fails to deliver either a Termination Notice or an
Acceptance Notice prior to the expiration of the Diligence Period, then (i) Buyer will be deemed
to have rejected the Property, (ii) the entire Deposit will be refunded to Buyer (other than as
expressly set forth in this Agreement), and (iii) this Agreement will terminate, except for
Obligations Surviving Termination.
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(c) If this Agreement is terminated for any reason, then Buyer will promptly return to
Seller any Diligence Materials delivered to Buyer in physical form in connection with the Property.
Section 2.2. Title and Survey Matters; Objections.
(a) Promptly following the Effective Date, Title Company will deliver to Buyer and
Seller a title insurance commitment or preliminary title report showing the status of title to the
Property (the “Title Commitment”). During the Diligence Period, Buyer may also, at Buyer’s
expense, obtain a new or updated ALTA survey of the Real Property performed by a registered
surveyor and certified to Buyer, Seller, the Title Company, and any other party required by Buyer.
Buyer will deliver a copy of any such new or updated survey to Seller and Title Company promptly
after Buyer’s receipt thereof. Any matters disclosed by the Title Commitment or Survey which are
approved, deemed approved, or waived by Buyer pursuant to the terms of this Agreement shall
constitute “Permitted Exceptions.”
(b) If any exceptions appear on the Title Commitment, or any encroachments or other
title conditions are shown on the Survey, that are not acceptable to Buyer, Buyer will provide
written notice to Seller and Title Company of such unacceptable matters (“Title Objection
Matters”) not later than thirty (30) days before the end of the Diligence Period. In addition, Buyer
will have the right to notify Seller and Title Company of any additional matters that first appear on
any updates to the Title Commitment issued after the expiration of the Diligence Period, and if
such matter(s) both (i) materially and adversely impact the Property to the extent that the Property
cannot be used substantially as intended by Buyer and (ii) were not caused by the acts or
omissions of Buyer, then Buyer may object to such additional matter(s) as Title Objection Matters
so long as any such additional objection is made by Buyer within five (5) days after Buyer receives
the updated Title Commitment adding such new matter (but, in any event, prior to the Closing
Date). Unless timely objected to in writing by Buyer as Title Objection Matters as provided above,
all matters disclosed by the Title Commitment or Survey (or any updates thereto) shall be deemed
to constitute Permitted Exceptions.
(c) Seller may elect (but is not obligated) to cure or attempt to cure any Title Objection
Matters and Seller will notify Buyer in writing within ten (10) Business Days after Seller receives
Buyer’s notice of Title Objection Matters if Seller elects to cure any of such objections. If neither
Seller nor Title Company elect within such period to cure the Title Objection Matters, then within
the later of five (5) Business Days and expiration of the Diligence Period thereafter (but in any
event prior to the Closing Date), Buyer may elect to either (i) terminate this Agreement, in which
event the Deposit will be returned to Buyer and thereafter the Parties will have no further rights
or obligations under this Agreement except for Obligations Surviving Termination, or (ii) waive
any uncured Title Objection Matters and proceed to Closing. Failure of Buyer to terminate the
Agreement prior to the later of the expiration of the Diligence Period or such five-Business Day
period shall be deemed an election by Buyer to waive any uncured Title Objection Matters and
proceed to Closing. Any Title Objection Matters so waived (or deemed waived) by Buyer shall be
deemed to constitute Permitted Exceptions.
(d) Seller has no obligation to bring any action or proceeding or incur any expense to
cure, remove or otherwise address any Title Objection Matter unless Seller expressly agrees to
do so in writing as provided in Section 2.2(c) or is required to do so pursuant to the last sentence
of this Section 2.2(d). Seller will be entitled to a reasonable extension of the Closing Date (not to
exceed thirty (30) days) for the cure or removal of any Title Objection Matters that Seller elects to
cure or remove. For purposes of this Section, a Title Objection Matter that is not completely
removed as an exception to title but has been cured by affirmatively insuring over or providing
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such other coverage as may be reasonably acceptable to Buyer with respect to such Title
Objection Matter will, as so cured, be a Permitted Exception. Notwithstanding the foregoing,
Seller will cure or remove any of the following that are timely identified by Buyer as Title Objection
Matters as provided above: (i) the liens of any mortgages or deeds of trust encumbering fee title
to the Real Property securing indebtedness of Seller to the mortgagee or beneficiary thereof, (ii)
mechanics’ liens pursuant to a written agreement directly between the claimant and Seller for
work at the Real Property; and (iii) whether or not included on the Title Commitment, any past
due property owners’ association fees or amounts owed by Seller or Tenant.
(e) Buyer’s obligation to purchase the Property is conditioned upon Title Company
being committed at Closing to issue an extended coverage owner’s policy of title insurance with
respect to the Real Property, dated as of Closing, on a standard ALTA form in an insured amount
equal to the Purchase Price, insuring that title to the Property is vested in Buyer subject only to
the Permitted Exceptions determined pursuant to this Section 2.2, with all endorsements
requested by Buyer and upon payment of the applicable premium therefor and the satisfaction by
Buyer of the Buyer’s conditions and requirements thereto, including provision of a current ALTA
Survey to the extent required therefor (the “Title Policy”).
(f) In addition to but without limiting the foregoing provisions of this Section, Seller will
reasonably cooperate with Buyer, at no material cost to Seller, to obtain agreement from all parties
to the Covenants and Declarations to remove the Property therefrom prior to expiration of the
Diligence Period; provided, that no such amendments or terminations that effectuate such
removal will be effective prior to Closing unless Seller consents to such earlier effectiveness in
Seller’s sole discretion, it being understood that Seller has no obligation to enter into any such
amendment or termination that in Seller’s reasonable judgement might compromise Seller’s or
Tenant’s rights with respect to the Property if Closing fails to occur.
Section 2.3. Entry, Insurance and Indemnity.
(a) Buyer must give Seller not less than two (2) Business Days’ prior written notice
(which may be via email to the Seller email notice addresses set forth on page 2 above) of any
desired entry by any Buyer Parties onto the Real Property and must coordinate such entry and
any related testing or inspections with Seller. Buyer must otherwise conduct each entry upon the
Property in a commercially reasonable manner. Seller has the right to have a representative
present during any entry by any Buyer Parties onto the Real Property; provided, however, that
the availability or lack thereof of any such representative shall not require Buyer to reschedule
any entry scheduled pursuant to this Section 2.3(a). Upon request, Buyer will provide Seller a list
of the vendors and contractors and scopes of work for tests and inspections to be performed,
which shall be subject to review and approval by Seller. Any invasive testing proposed by Buyer
will be set forth in additional detail for Seller’s consideration and approval.
(b) Buyer acknowledges that the Property is currently leased to Tenant under the
Lease, and that the Tenant retains the right to possession of the Property and may have personal
property located in the Property. Buyer acknowledges and agrees that any entry onto the Property
may need to be coordinated by Seller with Tenant.
(c) Buyer may not conduct any invasive testing, drilling, or boring at the Property, or
any environmental testing of the Property other than a standard ASTM “Phase I” environmental
study, and, if recommended by the “Phase I”, a “Phase II” environmental study, without in each
instance obtaining the prior written approval of Seller, which approval may be withheld in Seller’s
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sole and absolute discretion and, if granted, will be conditioned upon such precautions as Seller
deems advisable to protect itself and the Property.
(d) Buyer will maintain, and will require that any Buyer Party entering upon the
Property also maintains, commercial general liability insurance insuring the Buyer Parties against
any liability arising out of their activities in, upon, about or with respect to the Property, with limits
of at least $1,000,000 per occurrence and $2,000,000 aggregate (which limits may include
applicable excess or umbrella coverage). Buyer’s policy must insure the contractual liability of
Buyer’s indemnification and defense obligations under this Agreement and must (i) name Seller,
Realty Income Corporation, and Tenant as additional insureds with respect to all Claims arising
out of the activities of the Buyer Parties in, upon, about or with respect to the Property, (ii) contain
a cross-liability provision or coverage, and (iii) be primary and noncontributing with any other
insurance available to the additional insureds. Buyer must provide Seller with evidence that Buyer
has such insurance coverages in force prior to any entry by a Buyer Party upon the Property.
(e) Buyer will pay all costs incurred in connection with Buyer’s due diligence activities
regarding the Property, will promptly repair and restore any damage caused to the Property by
such activities, and will not permit any mechanics or other liens to be filed against the Property
as a result of such activities. BUYER WILL INDEMNIFY, DEFEND AND HOLD THE SELLER
PARTIES AND TENANT HARMLESS FROM AND AGAINST ANY CLAIMS ARISING OUT OF
ANY ACTIVITIES OF THE BUYER PARTIES IN, UPON, ABOUT OR WITH RESPECT TO THE
PROPERTY PRIOR TO CLOSING; PROVIDED, HOWEVER, BUYER SHALL NOT BE LIABLE
FOR LOSSES AND DAMAGES TO THE EXTENT CAUSED BY PRE-EXISTING CONDITIONS
OR LATENT DEFECTS, ANY LEGAL NONCONFORMANCE, THE DISCOVERY,
DISPLACEMENT, NON-NEGLIGENT DISTURBANCE, OR EXISTENCE OF ANY
HAZARDOUS MATERIALS NOT INITIALLY BROUGHT ONTO THE REAL PROPERTY BY
BUYER, ANY DIMINUTION IN THE VALUE OR MARKETABILITY OF THE PROPERTY
CAUSED BY THE BUYER’S DILIGENCE OR MATTERS DISCOVERED DURING BUYER’S
DILIGENCE OF THE PROPERTY, OR THE NEGLIGENT OR WILLFUL ACTS OR OMISSIONS
OF SELLER (COLLECTIVELY, THE “PRE-EXISTING CONDITIONS”), AND BUYER WILL
NOT BE RESPONSIBLE FOR INDEMNIFYING SELLER FOR THE MERE DISCOVERY OF
ANY PRE-EXISTING CONDITIONS ON THE PROPERTY (ENVIRONMENTAL OR
OTHERWISE). Buyer’s indemnity and insurance obligations under this Article 2 are not limited
by any other limitation on damages or remedies under this Agreement, including without limitation
the liquidated damages provisions contained in Article 6. The provisions of this Section will
survive the Closing or any earlier termination of this Agreement.
Section 2.4. AS-IS SALE. BUYER SPECIFICALLY ACKNOWLEDGES AND AGREES
THAT EXCEPT FOR SELLER’S REPRESENTATIONS, WARRANTIES AND COVENANTS AS
EXPRESSLY SET FORTH IN THIS AGREEMENT OR IN THE CLOSING DOCUMENTS, (A)
SELLER IS SELLING AND BUYER IS PURCHASING THE PROPERTY “AS IS, WHERE IS AND
WITH ALL FAULTS,” AND (B) BUYER IS NOT RELYING ON ANY REPRESENTATIONS,
WARRANTIES, COVENANTS OR AGREEMENTS OF ANY KIND WHATSOEVER, WHETHER
ORAL OR WRITTEN, EXPRESS OR IMPLIED, STATUTORY OR OTHERWISE, FROM SELLER
OR ANY SELLER PARTY AS TO ANY MATTER CONCERNING OR RELATING TO THE
PROPERTY, OR SET FORTH, CONTAINED OR ADDRESSED IN THE DILIGENCE
MATERIALS (INCLUDING WITHOUT LIMITATION, THE COMPLETENESS THEREOF),
INCLUDING WITHOUT LIMITATION AS TO: (I) THE QUALITY, NATURE, HABITABILITY,
MERCHANTABILITY, FITNESS, USE, OPERATION, VALUE, MARKETABILITY, ADEQUACY
OR PHYSICAL CONDITION OF THE PROPERTY OR ANY ASPECT OR PORTION THEREOF
(INCLUDING WITHOUT LIMITATION STRUCTURAL ELEMENTS, FOUNDATION, ROOF,
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APPURTENANCES, ACCESS, LANDSCAPING, PARKING FACILITIES, ELECTRICAL,
MECHANICAL, HVAC, COMMUNICATION, PLUMBING, SEWAGE, AND UTILITY SYSTEMS,
FACILITIES AND APPLIANCES, SOILS, GEOLOGY AND GROUNDWATER); (II) THE
DIMENSIONS OR LOT SIZE OF THE REAL PROPERTY OR THE SQUARE FOOTAGE OF THE
IMPROVEMENTS THEREON OR OF ANY TENANT’S OR OCCUPANT’S SPACE THEREIN OR
COMMON AREAS THEREOF; (III) THE DEVELOPMENT, REDEVELOPMENT, ENTITLEMENT,
OR INCOME POTENTIAL, OR RIGHTS OF OR RELATING TO, THE PROPERTY, OR THE
SUITABILITY, VALUE, ADEQUACY, OR FITNESS OF THE PROPERTY FOR ANY
PARTICULAR PURPOSE; (IV) THE ZONING OR OTHER LEGAL STATUS OF THE PROPERTY
OR ANY OTHER PUBLIC OR PRIVATE RESTRICTIONS ON THE USE OF THE PROPERTY;
(V) THE COMPLIANCE OF THE PROPERTY OR ITS OPERATION WITH ANY APPLICABLE
CODES, LAWS, REGULATIONS, STATUTES, ORDINANCES, COVENANTS, CONDITIONS
AND RESTRICTIONS OF ANY GOVERNMENTAL AUTHORITY OR OF ANY OTHER PERSON
OR ENTITY (INCLUDING, WITHOUT LIMITATION, THE AMERICANS WITH DISABILITIES
ACT); (VI) THE ABILITY OF BUYER TO OBTAIN ANY NECESSARY GOVERNMENTAL
APPROVALS, LICENSES OR PERMITS FOR THE CURRENT USE OR BUYER’S INTENDED
USE, DEVELOPMENT OR REDEVELOPMENT OF THE PROPERTY; (VII) THE PRESENCE OR
ABSENCE OF HAZARDOUS MATERIALS OR OTHER HAZARDOUS CONDITIONS ON, IN,
UNDER, ABOVE OR ABOUT THE PROPERTY OR ANY ADJOINING OR NEIGHBORING
PROPERTIES; (VIII) THE QUALITY OF ANY LABOR OR MATERIALS USED IN ANY
IMPROVEMENTS; (IX) THE CONDITION OF TITLE TO THE PROPERTY; (X) ANY LEASES OR
ANY CONTRACTS OR OTHER AGREEMENTS AFFECTING THE PROPERTY OR THE
INTENTIONS OF ANY PERSON WITH RESPECT TO THE NEGOTIATION AND/OR
EXECUTION OF ANY LEASES, CONTRACTS OR AGREEMENTS WITH RESPECT TO THE
PROPERTY; OR (XI) THE ECONOMICS OF, OR THE INCOME AND EXPENSES, REVENUE
OR EXPENSE PROJECTIONS OR OTHER FINANCIAL MATTERS RELATING TO, THE
OWNERSHIP OR OPERATION OF THE PROPERTY. WITHOUT LIMITING THE GENERALITY
OF THE FOREGOING, BUYER ACKNOWLEDGES AND AGREES THAT, EXCEPT AS
OTHERWISE EXPRESSLY SET FORTH IN THIS AGREEMENT, BUYER IS NOT RELYING ON
ANY REPRESENTATIONS, WARRANTIES, COVENANTS OR AGREEMENTS OF SELLER,
ANY OTHER SELLER PARTY, OR ANY AGENT OR BROKER OF SELLER, WHETHER
IMPLIED, PRESUMED OR EXPRESSLY PROVIDED AT LAW OR OTHERWISE, OR ARISING
BY VIRTUE OF ANY STATUTE, COMMON LAW OR OTHER RIGHT OR REMEDY IN FAVOR
OF BUYER. BUYER FURTHER ACKNOWLEDGES AND AGREES THAT SELLER IS UNDER
NO DUTY TO MAKE ANY INQUIRY REGARDING ANY MATTER THAT MAY OR MAY NOT BE
KNOWN TO SELLER, ANY OTHER SELLER PARTY, OR ANY OTHER AGENT OR BROKER
OF SELLER.
IF BUYER PURCHASES THE PROPERTY, ANY REPORTS, REPAIRS OR WORK REQUIRED
OF OR BY BUYER ARE THE SOLE RESPONSIBILITY OF BUYER, AND BUYER AGREES
THAT THERE IS NO OBLIGATION ON THE PART OF SELLER EITHER BEFORE OR AFTER
CLOSING TO MAKE ANY CHANGES, ALTERATIONS OR REPAIRS TO THE PROPERTY OR
TO CURE ANY VIOLATIONS OF LAW OR TO COMPLY WITH THE REQUIREMENTS OF ANY
INSURER OR GOVERNMENTAL AUTHORITY. BUYER IS SOLELY RESPONSIBLE FOR
OBTAINING THE ISSUANCE OR RE-ISSUANCE OF ANY CERTIFICATE OF OCCUPANCY OR
ANY OTHER APPROVAL OR PERMIT NECESSARY FOR TRANSFER OR OCCUPANCY OF
THE PROPERTY AND FOR ANY IMPROVEMENTS, REPAIRS OR ALTERATIONS
NECESSARY TO OBTAIN THE SAME, ALL AT BUYER’S SOLE COST AND EXPENSE.
THE PROVISIONS OF THIS SECTION WILL SURVIVE THE CLOSING OR ANY EARLIER
TERMINATION OF THIS AGREEMENT.
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Section 2.5. Release. Without limiting the provisions of Section 2.4, but subject to the
express rights and remedies reserved to Buyer in this Agreement, Buyer, for itself and the other
Buyer Parties (including without limitation any Permitted Assignee), waives all rights to recover
from, and forever releases, discharges and covenants not to sue, Seller and the other Seller
Parties with respect to any and all Claims, whether direct or indirect, known or unknown, foreseen
or unforeseen, that may exist or arise on account of or in any way be connected with the Property
(including without limitation the physical, operational, environmental, and structural condition of
the Property) or any law or regulation applicable thereto, including without limitation any Claims
or other matters relating to the use, presence, discharge or release of Hazardous Materials on,
under, in, above or about the Property. Buyer assumes the risk that Buyer’s investigations of the
Property may not reveal all aspects and conditions of the Property. Buyer acknowledges and
agrees that: (a) Buyer is an experienced and knowledgeable purchaser of real property; (b) Buyer
expressly accepts and fully understands the limitations of liability contained in this Agreement;
and (c) the limitations contained in this Agreement are reasonable. Buyer acknowledges and
agrees that Seller has agreed to enter into this Agreement in consideration for and in reliance
upon the limitations of liability contained in this Agreement, that the Purchase Price is based in
part on such limitations of liability, and that Seller would not have agreed to execute this
Agreement or sell the Property to Buyer on terms that did not include such limitations of liability.
EXCEPT AS MAY BE OTHERWISE EXPRESSLY PROVIDED IN THIS AGREEMENT,
THE WAIVERS AND RELEASES CONTAINED IN SECTIONS 2.4 AND 2.5 EXTEND TO ALL
CLAIMS OF ANY NATURE AND KIND WHATSOEVER, KNOWN OR UNKNOWN, SUSPECTED
OR NOT SUSPECTED, AND, TO THE FULLEST EXTENT PERMISSIBLE BY APPLICABLE
LAW, BUYER WAIVES ANY PROVISIONS OF APPLICABLE LAW THAT OTHERWISE MAY
LIMIT OR PROHIBIT SUCH WAIVERS AND RELEASES. THE PROVISIONS OF THIS
SECTION WILL SURVIVE THE CLOSING OR ANY EARLIER TERMINATION OF THIS
AGREEMENT.
ARTICLE 3
OPERATION OF THE PROPERTY
Section 3.1. Operation of the Property. Between the Effective Date and the Closing
Date, Seller (a) will use commercially reasonable efforts to maintain the Property in substantially
the same physical condition as existed on the Effective Date, excluding reasonable wear and tear
and any damage or destruction by Casualty, Condemnation (both as defined below), or other
causes or events beyond the reasonable control of Seller; and (b) will not enter into any
encumbrances of record which would continue to be binding upon the Property following Closing
without Buyer’s consent, provided that (i) if Buyer fails to either give or expressly refuse such
consent within five (5) Business Days of receiving the written request from Seller, such consent
shall conclusively be deemed to have been given; and (ii) Buyer’s consent (x) may not be
unreasonably withheld, conditioned or delayed with respect to any such agreement that is
proposed prior to the expiration of the Diligence Period; and (y) may be granted or withheld in
Buyer’s sole but commercially reasonable discretion with respect to any such agreement that is
proposed between the expiration of the Diligence Period and Closing.
Section 3.2. Casualty. If the Property is damaged or destroyed by fire, theft, vandalism,
or other casualty event (“Casualty”) prior to Closing, Seller will provide prompt written notice to
Buyer of such Casualty once Seller becomes aware of same. Buyer will likewise provide prompt
written notice to Seller of any Casualty if Buyer becomes aware of same. If the Property is
“materially damaged or destroyed” (as defined below) by such Casualty, Buyer may terminate this
Agreement by written notice given to Seller within ten (10) Business Days after Buyer receives
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notice of the occurrence of such Casualty. If Buyer so terminates this Agreement, then the
Deposit will be returned to Buyer and neither Party will have any further rights or obligations under
this Agreement except for Obligations Surviving Termination. If Buyer does not so terminate this
Agreement, or if the Property is not deemed “materially damaged or destroyed,” Buyer will remain
bound to purchase the Property for the full Purchase Price pursuant to the terms of this
Agreement, without regard to the occurrence or effects of the Casualty; provided that at Closing
Seller will provide Buyer with a credit against the Purchase Price equal to the amount of the
property insurance proceeds that would be payable to Seller for the repair of the physical damage
to the Property, if any, up to (but not to exceed) the Purchase Price, net of any costs and expenses
reasonably incurred by Seller prior to Closing in connection with the Casualty and excluding any
deductible amount applicable thereto. For purposes of this Section, the Property shall be deemed
“materially damaged or destroyed” if (a) the estimated repair cost to restore the Property to
substantially the condition it was in as of the Effective Date (the “ERC”) is more than twenty
percent (20%) of the Purchase Price, or (b) the insurance proceeds amount that would be credited
to Buyer as provided above (if any) is less than the ERC by an amount greater than ten percent
(10%) of the Purchase Price. Buyer will receive the Property in its then “as-is, where is” condition
as of the Closing Date regardless of any such Casualty.
Section 3.3. Condemnation. If any condemnation proceedings are instituted, or notice
of any condemnation or intent to condemn is given, with respect to all or any portion of the Real
Property (a “Condemnation”) prior to Closing, Seller will provide prompt written notice to Buyer
of such Condemnation. If the Condemnation will result in a “material and adverse effect” (as
defined below) to the Property, Buyer may terminate this Agreement by written notice given to
Seller within ten (10) Business Days after the date Buyer receives notice of such Condemnation.
If Buyer so terminates this Agreement, then the Deposit will be returned to Buyer and neither
Party will have any further rights or obligations under this Agreement except for Obligations
Surviving Termination. If Buyer does not so terminate this Agreement, or if the Condemnation
will not result in a “material and adverse effect” to the Property, Buyer will remain bound to
purchase the Property for the full Purchase Price pursuant to the terms of this Agreement, without
regard to the occurrence or effect of the Condemnation; provided that at Closing Seller will assign
to Buyer Seller’s interest in the award payable to Seller on account of the Condemnation (if any),
but net of any losses, costs and expenses reasonably incurred by Seller prior to Closing in
connection with the Condemnation. For purposes of this Section, “material and adverse effect”
means the permanent loss of title to more than fifteen percent (15%) of the square footage of the
Land as existing as of the Effective Date.
ARTICLE 4
REPRESENTATIONS AND WARRANTIES
Section 4.1. Representations and Warranties of Seller. Subject to the information
disclosed by the Diligence Materials, Title Commitment and Survey, Seller makes the following
representations and warranties to Buyer as of the Effective Date and (except as may be disclosed
in writing to Buyer after the Effective Date) again as of the Closing Date:
(a) Seller is duly organized and validly existing and in good standing under the laws
of its state of formation; and the execution, delivery and performance of this Agreement and all
Closing Documents to be executed and delivered by Seller pursuant to this Agreement are within
the organizational power of Seller and have been or will prior to Closing be duly authorized.
(b) Neither the execution and the delivery of this Agreement, nor the consummation
of the transactions herein by Seller shall constitute a violation or breach of applicable laws, or of
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any provision of any contract, agreement, mortgage or instrument to which Seller is a party or by
which Seller is bound, or by an order, writ, injunction, decree or judgment applicable to Seller.
(c) Seller has not filed any voluntary petition in bankruptcy or suffered the filing of any
involuntary petition by Seller’s creditors or suffered the appointment of a receiver to take
possession of the Property.
(d) There are no actions or proceedings pending or, to Seller’s knowledge, threatened
against Seller that Seller reasonably expects would affect the validity or enforceability of this
Agreement or any of the Closing Documents to be executed and delivered by Seller pursuant to
this Agreement.
(e) Other than the potential Condemnation being pursued by Buyer or any related
Governmental Authority, Seller has not received written notice of any currently pending or
threatened Condemnation, rezonings, annexations, special assessments, creation of or inclusion
in any statutory district, authorities, or other similar governmental, quasi-governmental, or
administrative actions with regard to all or any portion of the Real Property.
(f) Other than the Lease or as may be referred to or contained in any document
recorded against the Property, there are no leases, subleases, licenses, or other rights of
occupancy in or to the Property to which Seller is a direct party, other than any service contracts
to which Seller is a direct party that are timely disclosed to Buyer as part of the Seller Deliveries,
or to Seller’s knowledge any unrecorded easements, declarations, or other agreements related
to the Property.
(g) As of the Effective Date, Seller has not received any written notice from any
Governmental Authority that the Real Property is presently in material violation of any applicable
environmental or other laws relating to the Real Property.
(h) As of the Effective Date, Seller has not received written notice of any litigation that
is currently pending or threatened against Seller with respect to the Real Property, other than (if
applicable) the potential Condemnation being pursued by Buyer or any related Governmental
Authority.
(i) The Seller Deliveries constitute true and complete copies of all such items as
contained in Seller’s electronic files.
For purposes of this Agreement and any Closing Documents, whenever the phrases “to the best
of Seller’s knowledge”, or the “knowledge” of Seller or words of similar import are used, they shall
be deemed to refer to the current, actual, conscious knowledge only, and not any implied, imputed
or constructive knowledge, without any independent investigation having been made or any
implied duty to investigate, of the representative(s) of Seller with the responsibility for directly
overseeing the management and operations of the Property. Such individual(s) will have no
personal liability under this Agreement or otherwise with respect to the Property.
Section 4.2. Representations and Warranties of Buyer. Buyer makes the following
representations and warranties to Seller as of the Effective Date and (except as may be disclosed
in writing to Seller after the Effective Date) again as of the Closing Date:
(a) Buyer is an urban renewal authority duly organized and existing under the laws of
the state of Colorado law and is duly qualified to transact business the state of Colorado; and the
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execution, delivery and performance of this Agreement and all Closing Documents to be executed
and delivered by Buyer pursuant to this Agreement are within the organizational power of Buyer
and have been or will prior to Closing be duly authorized by proper action of its Board of
Commissioners.
(b) Neither the execution and the delivery of this Agreement, nor the consummation
of the transactions herein by Buyer shall constitute a violation or breach of applicable laws, or of
any provision of any contract, agreement, mortgage or instrument to which Buyer is a party or by
which Buyer is bound, or by an order, writ, injunction, decree or judgment applicable to Buyer.
(c) Buyer has not filed any voluntary petition in bankruptcy or suffered the filing of any
involuntary petition by Buyer’s creditors or suffered the appointment of a receiver to take
possession of any of Buyer’s property.
(d) There are no actions or proceedings pending or, to Buyer’s knowledge, threatened
against Buyer that Buyer reasonably expects would affect the validity or enforceability of this
Agreement or any of the Closing Documents to be executed and delivered by Buyer pursuant to
this Agreement.
(e) Buyer (i) is an experienced and knowledgeable purchaser of real property, (ii) is
represented by competent counsel, and (iii) understands and accepts the terms and provisions of
this Agreement, including without limitation all releases, waivers, limitations, and assumptions of
risk and liability set forth in this Agreement.
For purposes of this Agreement and any Closing Documents, whenever the phrases “to
the best of Buyer’s knowledge”, or the “knowledge” of Buyer or words of similar import are used,
they shall be deemed to refer to the current, actual, conscious knowledge only, and not any
implied, imputed or constructive knowledge, without any independent investigation having been
made or any implied duty to investigate, of Josh Birks. Josh Birks will have no personal liability
under this Agreement or otherwise with respect to the Property.
Section 4.3. OFAC and Source of Funds. Buyer and Seller each represent and
warrant to the other, and to Escrow Agent, that (a) such Party is not a Restricted Person; (b) such
Party is not knowingly acting, directly or indirectly, for, on behalf of, or in conjunction with any
Restricted Person and is not engaging in, instigating or facilitating this transaction for or on behalf
of any Restricted Person; (c) such Party is not engaging in this transaction, directly or indirectly,
in violation of any laws relating to drug trafficking, money laundering or predicate crimes to money
laundering; and (d) none of the funds of such Party to be utilized in this transaction have been or
will be derived from any unlawful activity with the result that such Party, its funds, or the Property
is subject to potential seizure, forfeiture or other such remedy or that this Agreement or the
transactions hereunder are or will be in violation of any applicable laws or regulations. The
provisions of this Section will survive the Closing (in this sole instance, without regard to the
limitations contained in Section 4.5) or any earlier termination of this Agreement.
Section 4.4. Inaccuracy Discovered Prior to Closing. Neither Party may rely on any
representation or warranty made by one Party (the “Maker”) to the other Party (the “Recipient”)
in this Agreement or in any Closing Document to the extent that such representation or warranty
was, is or has become inaccurate or incorrect in any material respect (the “Inaccuracy”) and the
Recipient has, receives or obtains actual knowledge of the Inaccuracy prior to Closing. (If the
Recipient first obtains actual knowledge of the Inaccuracy after Closing, Section 4.5 below will
apply instead of this Section 4.4.) If the Recipient believes, has received or obtains actual
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knowledge prior to or at Closing that an Inaccuracy exists, then the Recipient will immediately
give written notice to the Maker of the Inaccuracy. The Maker will have the right, but not the
obligation, to elect to cure the Inaccuracy (or the cause or any affects thereof) within ten (10)
Business Days after the Maker’s receipt of such notice. Regardless of whether such cure is
elected, attempted, or achieved by the Maker, the Recipient’s sole remedy with respect to an
Inaccuracy that is actually known by the Recipient prior to Closing is to terminate this Agreement
by giving the Maker written notice of such termination within five (5) Business Days after the end
of the Maker’s ten (10) Business Day cure period. If necessary, the Closing Date will be
automatically extended to allow such periods to expire. If the Recipient so terminates this
Agreement, (a) the Deposit will be returned to Buyer, regardless of whether Buyer is the Maker
or the Recipient, and (b) neither Party will have any further rights or obligations under this
Agreement except for Obligations Surviving Termination. If the Recipient does not so terminate
this Agreement, the Recipient shall be conclusively deemed to have waived the Inaccuracy and
all effects or consequences thereof, and the Maker will have no liability whatsoever with respect
to the Inaccuracy. In furtherance of the foregoing, each Party agrees that the Maker will have no
liability with respect to any representation or warranty to the extent that, prior to the Closing, the
Recipient has, receives or obtains actual knowledge of an Inaccuracy (from whatever source,
including without limitation from disclosure by or on behalf of the Maker) and the Recipient
nevertheless proceeds to close the purchase or sale of the Property under this Agreement without
availing itself of the termination remedy provided under this Section 4.4. The provisions of this
Section will survive the Closing or any earlier termination of this Agreement.
Section 4.5. Survival of Representations and Warranties. Subject in all respects to
Section 4.4, the representations and warranties made by each Party in this Agreement or any
Closing Document will survive the Closing only until the date that is two hundred-seventy (270)
days following the date of Closing (the “Expiration Date”). Any Claims for, relating to or arising
from an Inaccuracy discovered after Closing are limited in all respects to any actual damages the
Recipient sustained from the Recipient’s reasonable reliance upon the representation or warranty
prior to obtaining actual knowledge of the Inaccuracy. In no event will either Party be liable to the
other Party for any lost profits or consequential, indirect, special or punitive damages suffered by
a Party as a result of any Inaccuracy. If an Inaccuracy is discovered after Closing and the
Recipient desires to pursue any remedy against the Maker with respect to such Inaccuracy, then
the Recipient must give the Maker a Claim Notice detailing the Inaccuracy upon or prior to the
Expiration Date. Any Claims that a Recipient might otherwise have or have had against a Maker
with respect to any Inaccuracy, whether such Inaccuracy or such Claims are known or unknown,
will not be valid or effective if a Claim Notice detailing the Inaccuracy has not been given to the
Maker on or prior to the Expiration Date. For the avoidance of doubt, following the Expiration
Date, each Party shall be deemed to be fully discharged and released (without the need for
separate releases or other documentation) from any liability or obligation to the other Party (and
to its other Buyer Parties or Seller Parties, as applicable) with respect to any Inaccuracy, known
or unknown, not detailed in a Claim Notice delivered to the other Party on or prior to the Expiration
Date. Further, any Claims that either Party may have at any time against the other Party for any
matter with respect to which a Claim Notice has been given to the other Party on or prior to the
Expiration Date may be the subject of subsequent litigation brought by the claiming Party, but
only if such litigation is commenced against and duly served upon the other Party on or prior to
the date that is ninety (90) days following the Expiration Date (the “Claim Bar Date”). For the
avoidance of doubt, following the Claim Bar Date, each Party shall be deemed to be fully
discharged and released (without the need for separate releases or other documentation) from
any liability or obligation to the other Party (and to its other Buyer Parties or Seller Parties, as
applicable) with respect to any Claim, known or unknown, except for any Claim for which both (a)
a Claim Notice was given by the claiming Party to the other Party on or prior to the Expiration
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Date, and (b) litigation upon the Claim has been commenced by the claiming Party and duly
served upon the other Party prior to or upon the Claim Bar Date. This Section (and Section 4.4
above) collectively provide the sole remedies of each Party with respect to any Inaccuracy and
each Party expressly waives any other rights or remedies such Party might otherwise have at law
or in equity with respect to any Inaccuracy in any representation or warranty of the other Party.
The provisions of this Section will survive the Closing or any earlier termination of this Agreement.
ARTICLE 5
CLOSING, DELIVERIES AND PRORATIONS
Section 5.1. Closing. The Closing and the delivery of all items to be delivered by the
Parties at the Closing will be performed through an escrow closing conducted by Escrow Agent
on the Closing Date. Except as may otherwise be expressly provided in this Agreement, the
Closing Date may not be accelerated or extended without the prior written approval of both Seller
and Buyer.
Section 5.2. Lease Termination. Prior to execution of this Agreement, Seller
negotiated an agreement with Tenant providing for the early termination of the Lease, which lease
termination (subject to the conditions thereto as set forth in Seller’s lease termination agreement
with Tenant) will be effective upon or before the Closing (the “Lease Termination”). The Lease
Termination is a condition to each of Seller’s and Buyer’s obligation to close, and Seller’s failure
to effect the Lease Termination at Closing may be asserted by Buyer as a default by Seller as
provided in Section 6.1 of this Agreement.
Section 5.3. Closing Conditions. The obligation of Seller, on the one hand, and Buyer,
on the other hand, to consummate the transaction contemplated hereunder is contingent upon
the following:
(a) The other Party’s representations and warranties contained herein shall be true
and correct in all material respects as of the Effective Date of this Agreement and the Closing
Date, such that neither Party has a right to terminate this Agreement for an uncured breach
pursuant to Section 4.4 above;
(b) Buyer shall have secured its bonding financing or other Lender financing, if
applicable, prior to the expiration of the Diligence Period;
(c) As of the Closing Date, the parties to the Covenants and Declarations shall have
delivered the final amendments and terminations that remove the Property from the Covenants
and Declarations, all as are determined and agreed prior to the end of the Diligence Period, along
with executed signatures to be attached thereto, to Escrow Agent, with instruction that the
signatures be released and such executed amendments and terminations be recorded upon
Closing;
(d) As of the Closing Date, the other Party shall have performed its obligations
hereunder, including that Seller has caused (or is concurrently with Closing causing) the Lease
Termination to occur as set forth in Section 5.2, Seller has obtained the ROFR Waiver as set forth
in Section 7.21, and all deliveries to be made at Closing shall have been tendered, such that
neither Party has a right to terminate this Agreement pursuant to Article 6 below; and
(e) The Escrow Agent shall have issued or committed to issue the Title Policy to Buyer
at Closing as contemplated by Section 2.2 above.
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So long as a Party is not in default hereunder, if any condition to such Party’s obligation
to proceed with the Closing hereunder has not been satisfied as of the Closing Date, such Party
may, in its sole discretion, (i) terminate this Agreement by delivering written notice to the other
Party on or before the Closing Date, in which event the Deposit (provided Buyer is not in default
hereunder) shall be returned to the Buyer and the Seller Deliveries shall be returned to Seller and
this Agreement shall be of no further force or effect except for Obligations Surviving Termination,
or (ii) elect to close, notwithstanding the nonsatisfaction of such condition, in which event such
Party shall be deemed to have waived any such condition. If such Party elects to close,
notwithstanding the nonsatisfaction of such condition, there shall be no liability on the part of the
other Party for nonsatisfaction of such condition or for breaches of representations and warranties
of which the Party electing to close had knowledge as of the Closing. If no election is made by
the applicable Party, such Party shall be deemed to have elected (ii) above.
Section 5.4. Closing Documents.
(a) On or before the Closing Date, Seller will deliver the following into the escrow, with
all documents having been duly executed (and if to be recorded, acknowledged) by Seller:
(i) a Special Warranty Deed (or the state-specific equivalent thereof) in the
form attached hereto as Exhibit B (the “Deed”);
(ii) a Bill of Sale in the form attached hereto as Exhibit C (the “Bill of Sale”);
(iii) an Assignment of Intangible Property in the form attached hereto as Exhibit
D (the “General Assignment”);
(iv) the closing settlement statement;
(v) such disclosures and reports (including tax reporting and withholding
certificates) as are required of Seller by applicable state and local law in connection with the
conveyance of the Property;
(vi) a confirmation pursuant to Section 1445(b)(2) of the Code that Seller is not
a “foreign person” within the meaning of Section 1445(f)(3) of the Code;
(vii) Colorado Form DR 1083, in form required by law;
(viii) Seller’s “owner’s affidavit” or comparable assurance to Title Company
regarding work performed and other customary matters, in a form reasonably acceptable to Seller;
(ix) Resolutions, certificates of good standing and such other organizational
documents as Title Company shall reasonably require evidencing Seller’s authority to
consummate the transaction, as approved by Title Company pursuant to the title review process
contemplated by Section 2.2 above; and
(x) such other documents as may be specifically required under this
Agreement, and such other customary documents as are necessary and appropriate to effectuate
the Closing and are reasonably acceptable to Seller.
(b) On or before the Closing Date, Buyer will deliver the following into the escrow, with
all documents having been duly executed (and if to be recorded, acknowledged) by Buyer:
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(i) the Purchase Price, less the amount of the Deposit, as adjusted and
reflected in the closing settlement statement agreed upon by Buyer and Seller;
(ii) counterparts of the Bill of Sale and the General Assignment;
(iii) the closing settlement statement;
(iv) such disclosures and reports (including tax reporting and withholding
certificates) as are required of Buyer by applicable state and local law in connection with the
conveyance of the Property;
(v) Resolutions, certificates of good standing and such other organizational
documents as Title Company shall reasonably require evidencing Buyer’s authority to
consummate the transaction; and
(vi) such other documents as may be specifically required under this
Agreement, and such other customary documents as are necessary and appropriate to effectuate
the Closing and are reasonably acceptable to Buyer.
(c) The Parties agree that the form documents attached as exhibits to this Agreement
are acceptable to accomplish the conveyances contemplated by this Agreement. The acceptance
by Buyer of the Deed at Closing shall be deemed to be a full performance and discharge of every
obligation on the part of Seller to be performed under this Agreement, other than those that are
specifically stated in this Agreement to survive the Closing.
Section 5.5. Prorations. Items of income and expense relating to the Property will be
adjusted between Seller and Buyer as provided below. Closing Date prorations will be made as
of 12:01 A.M. local time on the day of Closing as if Buyer was the owner of the Property for the
entire Closing Date.
(a) Real Estate Taxes due and payable in the calendar year of Closing will be prorated
as of the Closing Date. If the Closing occurs before the relevant tax bill is available, the
apportionment of Real Estate Taxes will be made based upon the most recent tax bill available
for the Real Property and will be a final settlement. If any Real Estate Taxes are appealed by
either Party, any refund of Real Estate Taxes will be prorated based upon the relative payment
by the Parties of the Real Estate Taxes to which the refund relates (with any Real Estate Taxes
paid by Tenant being counted as paid by Seller for such purpose).
(b) Any and all amounts payable by Tenant to Seller (as landlord) under the Lease
shall be retained by Seller, including any payments related to the Lease Termination. Buyer will
have no responsibility for any obligations payable as a result of the existence of the Lease,
including any leasing commissions related thereto.
(c) All other items of expense for the Property, including but not limited to any utility
charges, maintenance charges, and charges under any Permitted Exceptions, will be prorated as
of the Closing Date. For any utilities in the name of Seller, Buyer and Seller will cooperate to
arrange for final utility readings as close to the Closing Date as possible and the issuance of a
final bill to Seller, with Buyer being designated the billing party in lieu of Seller from and after the
Closing Date. Seller will be entitled to receive and retain any deposits of Seller held by utility
companies with respect to the Property.
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(d) Seller will supply the relevant information to Escrow Agent prior to Closing, and the
Parties will cooperate in the calculation, review and finalization of the adjustments and prorations
contemplated by this Section for Closing. The Purchase Price, prorations, closing costs, and any
other credits and adjustments will be reflected on a closing settlement statement prepared by
Escrow Agent and executed by Buyer and Seller for the Closing. If a net amount is owed by Seller
to Buyer pursuant to this Section, such amount will be credited against the Purchase Price at
Closing. If a net amount is owed by Buyer to Seller pursuant to this Section, such amount will be
paid to Seller together with the Purchase Price at Closing.
(e) The provisions of this Section that by their terms are to occur after Closing will
survive the Closing.
Section 5.6. Closing Costs. At Closing, Seller will pay (a) the insurance premium
amount for a standard coverage owner’s policy of title insurance in the amount of the Purchase
Price, including any search or exam costs required therefor; (b) the costs of releasing any liens
or other encumbrances that are agreed or required to be released by Seller pursuant to Section
2.2 above, and of recording any such releases; (c) the cost of recording the Deed; and (d) all
other costs this Agreement expressly requires Seller to pay. At Closing, Buyer will pay (i) all title
insurance costs and charges (other than those for the standard coverage policy to be paid by
Seller as provided in subsection (a) above), including any costs for extended coverage, title
endorsements, lender policies, or other coverage requested by Buyer; (ii) the cost of any new or
updated Survey and other due diligence studies or reports obtained by Buyer; (iii) the cost of
recording any Closing Documents (other than the costs of recording paid by Seller as provided in
subsection (a) and (b) above); (iv) the fees and costs due Escrow Agent for its sale escrow
services under this Agreement; (v) any state, county or local documentary, franchise or transfer
taxes; and (vi) all other costs this Agreement expressly requires Buyer to pay. Except as
otherwise expressly provided for in this Agreement, Seller and Buyer will each be solely
responsible for and bear all of their own respective transaction costs and expenses, including
without limitation all expenses of legal counsel, accountants, and other advisors and consultants
incurred at any time in connection with pursuing or consummating the transaction contemplated
herein. Any other closing costs and charges not specifically designated as the responsibility of
either Party in this Agreement will be paid by the Parties according to the usual and customary
allocation/apportionment of such costs in the jurisdiction in which the Property is located. Buyer
and Seller agree that there is little or no Personal Property included within the Property and no
portion of the Purchase Price will be allocated or attributable to Personal Property.
Section 5.7. Brokers. Buyer and Seller each state and confirm to the other that no
broker, finder or comparable Person was utilized in arranging or bringing about this transaction
and that there are no claims or rights for brokerage fees, commissions, finders’ fees, or
comparable fees or compensation due to any Person in connection with the transactions
contemplated by this Agreement. If any Person asserts a claim for a commission, fee or other
compensation based upon any contact, dealings or communication with Buyer or Seller, then the
Party through whom such Person makes its claim will indemnify, defend and hold harmless the
other Party from such claim and any and all costs, damages, liabilities or expenses (including
without limitation, reasonable attorneys’ fees and disbursements) incurred by the other Party in
connection with such claim. The provisions of this Section will survive the Closing or any earlier
termination of this Agreement.
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ARTICLE 6
DEFAULT; REMEDIES
Section 6.1. Default by Seller. If Seller fails to perform any obligation of Seller under
this Agreement prior to or at Closing and does not cure such failure (a) within three (3) Business
Days after receipt of written notice from Buyer asserting such failure, if Seller fails to timely deliver
Closing Documents or authorize Closing if and when required of Seller for Closing to occur under
this Agreement, or (b) within ten (10) days after receipt of written notice from Buyer asserting such
failure, if Seller fails to perform any other obligation of Seller (any such failure, if not cured within
such period, being a “Seller Default”), then Buyer will elect by giving written notice to Seller and
Escrow Agent within thirty (30) days after the occurrence of such Seller Default, as Buyer’s sole
and exclusive remedy against Seller, either to (i) terminate this Agreement, in which event the
Deposit will be returned to Buyer and neither of the Parties will have any further rights, liabilities
or obligations under this Agreement, except for Obligations Surviving Termination, or (ii) bring a
suit for specific performance against Seller to compel Seller to convey the Property to Buyer as
required under this Agreement; provided, however that as a condition precedent to Buyer’s pursuit
of any action for specific performance, Buyer (x) must have fully and timely performed all of
Buyer’s obligations and made all deliveries (other than the delivery of the balance of the Purchase
Price) required to be performed or delivered on or before the Closing Date, (y) must maintain the
full Deposit in escrow until and during the pendency of such action, and (z) must demonstrate to
the court Buyer’s ability to fund on the Closing Date (and upon any subsequent award of specific
performance of such conveyance) the full amount of the Purchase Price. Buyer shall be deemed
to have elected to terminate this Agreement (as provided in subsection 6.1(i) above) if Buyer does
not deliver to Seller written notice of Buyer’s intent to file a cause of action for specific performance
against Seller on or before thirty (30) days after such Seller Default, or having timely given Seller
such notice, fails to file and serve Seller with a lawsuit asserting such cause of action within sixty
(60) days after such notice.
Section 6.2. Default by Buyer. If Buyer fails to perform any obligation of Buyer under
this Agreement prior to or at Closing and does not cure such failure (a) within three (3) Business
Days after receipt of written notice from Seller asserting such failure, if Buyer (i) fails to timely pay
or deposit any amount of money required to be paid or deposited by Buyer under this Agreement,
or (ii) fails to timely deliver Closing Documents or authorize Closing if and when required of Buyer
for Closing to occur under this Agreement, or (b) within ten (10) days after receipt of written notice
from Seller asserting any such failure, if Buyer fails to perform any other obligation of Buyer (any
such failure, if not cured within such period, being a “Buyer Default”), then Seller will be entitled,
as Seller’s sole and exclusive remedy against Buyer, to terminate this Agreement and receive the
Deposit as Seller’s agreed and total liquidated damages by giving written notice of termination to
Buyer and Escrow Agent within thirty (30) days after the occurrence of such Buyer Default. Upon
Seller’s receipt of the Deposit, neither of the Parties will thereafter have any further rights, liabilities
or obligations under this Agreement except for Obligations Surviving Termination. The Parties
have agreed that Seller’s actual damages in the event of a Buyer Default would be
extremely difficult or impracticable to determine. The Parties have therefore agreed that,
considering all the facts and circumstances existing as of the Effective Date, the amount
of the Deposit is a reasonable estimate of the damages that Seller would incur in the event
of a Buyer Default. Each Party specifically confirms the accuracy of the statements made
above and the fact that each Party was represented by counsel who explained, at the time
this Agreement was made, the consequences of this liquidated damages provision.
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Section 6.3. Limitations on Liability.
(a) Unless otherwise expressly stated in this Agreement, the provisions of Sections
6.1 and 6.2 above provide each Party’s sole remedies for any failure by the other Party to perform
its respective obligations under this Agreement prior to or at Closing, but will not limit any rights
or remedies that either Party may have for a breach or default by the other Party after Closing
with respect to those provisions of this Agreement, or those provisions of the Closing Documents,
that are expressly stated to survive Closing. However, in no event will either Party be liable to
the other Party for any lost profits or consequential, indirect, special or punitive damages suffered
by a Party as a result of any failure, breach or default, either before or after Closing, by the other
Party under this Agreement or any of the Closing Documents, and each Party expressly waives
any right to recover any lost profits or consequential, indirect, special or punitive damages caused
to such Party by the other Party. The Parties agree that any attorneys’ fees awarded pursuant to
Section 7.6 below will not be subject to the limitations of this Section 6.3.
(b) Notwithstanding anything to the contrary set forth in this Agreement or any of the
Closing Documents, (i) Seller will have no liability whatsoever with respect to any Claims suffered
or incurred by, asserted or assessed against, or imposed upon Buyer or any Buyer Party under
or with respect to this Agreement, the Property, or any Closing Document, except to the extent
(and only to the extent) that such Claims exceed $20,000.00 (the “Threshold Amount”); and (ii)
in no event will the total aggregate liability of Seller and any Seller Parties for any or all Claims
with respect to the entirety of the Property and the transactions contemplated by this Agreement
and the Closing Documents exceed $250,000.00 (the “Maximum Amount”). Buyer shall not
make any Claims or deliver any Claim Notice unless Buyer in good faith believes the Claims would
exceed the Threshold Amount, and Buyer shall not seek or receive for such Claims any remedies
or awards that individually or in the aggregate would exceed the Maximum Amount.
Section 6.4. Survival. The terms, provisions and limitations of this Article will survive
the Closing or any earlier termination of this Agreement.
ARTICLE 7
MISCELLANEOUS
Section 7.1. Notices. Any notices required or permitted to be given under this
Agreement must be given in writing and delivered to the recipient’s notice address as provided in
this Agreement either (a) in person, (b) by certified mail, postage prepaid, return receipt
requested, (c) by a commercial overnight courier that guarantees next Business Day delivery and
provides a delivery confirmation to the sender, or (d) by email; provided, that any emailed notice
purporting to either terminate this Agreement or provide notice of an asserted failure, breach or
default by the other Party must be followed by a hard copy thereof given within one (1) Business
Day thereafter that is delivered in accordance with one of the preceding subsections (a)-(c),
unless receipt of such hard copy is expressly waived by a reply email from the recipient Party in
response to such notice email. The notice addresses for the Parties are as set forth in the
Summary of Terms. Either Party may specify a different or additional domestic (United States)
notice address for itself as such Party may from time to time desire by giving notice thereof in
writing as provided above to the other Party. If sent by email, a notice shall be deemed given
upon the date when such email is transmitted by the sending Party to the receiving Party’s notice
address, and shall be deemed received on that same date unless such notice is transmitted by
the sender after 5:00 p.m. Mountain Time, in which case receipt by the receiving Party shall be
deemed to be upon the next Business Day. If personally delivered, a notice shall be deemed
given and received upon the date of such delivery. If sent by overnight courier service, a notice
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shall be deemed given upon the date of deposit with such courier and deemed received upon the
date of delivery or refusal of delivery at the notice address. If sent by certified mail, a notice shall
be deemed given and received on the fifth Business Day after deposit into the US Mail. Notices
from or signed by the legal counsel for a Party will be equally effective as a notice from such Party
itself.
Section 7.2. Entire Agreement. This Agreement, together with the Exhibits and
Schedules hereto, contains all agreements, representations, warranties and covenants made by
Buyer and Seller and constitutes the entire understanding between the Parties with respect to the
purchase and sale of the Property. All Exhibits and Schedules to this Agreement are fully
incorporated as a part of this Agreement. Any prior correspondence, memoranda, letters of intent,
or other agreements between the Parties, including without limitation any oral or written
statements made by the Seller Parties or the Buyer Parties, are not binding on or enforceable
against either Party, and are entirely superseded and replaced by this Agreement; provided,
however, that any prior access, confidentiality, or non-disclosure agreement(s) between Seller
and Buyer or any Buyer Party will remain of full force and effect and will not be superseded by
this Agreement.
Section 7.3. Confidentiality. Seller will be providing Confidential Information in
connection with Buyer’s evaluation of the transaction and the Property during the term of this
Agreement, and Buyer will obtain additional Confidential Information pursuant to Buyer’s due
diligence investigations of and regarding the Property. Buyer agrees to keep the Confidential
Information strictly confidential and shall not disclose, permit the disclosure of, release,
disseminate or transfer, whether written or orally or by any other means, such Confidential
Information, in whole or in part, in any manner; provided, however, that the Buyer Parties may
make such limited disclosures, strictly on a “need-to-know” basis, to and among the Buyer Parties
as may reasonably be required in connection with Buyer’s evaluation of the Property. Buyer
agrees that the other Buyer Parties must be informed by Buyer of the confidential nature of the
Confidential Information and must be required by Buyer to treat the Confidential Information in
confidence as required under this Agreement. Buyer will be responsible for ensuring the
compliance of all Buyer Parties with the terms of this Agreement. Buyer will take all appropriate
measures to safeguard the confidentiality and avoid any disclosure of Confidential Information to
any unauthorized Person by Buyer or the Buyer Parties and to the extent legally permissible to
treat it as proprietary commercial and financial information not subject to disclosure under any
applicable law and the Colorado Open Records Act as Buyer is a quasi-governmental entity. No
license is granted, directly or indirectly, to any of the Confidential Information. If this Agreement
is terminated prior to Closing, then except as provided in Section 2.1 above, Buyer will destroy,
and cause each of the Buyer Parties to destroy, all materials containing Confidential Information.
Notwithstanding the foregoing, (a) to the extent required by a Buyer Party’s customary internal
policies or other legal requirements applicable to such Buyer Party, such Buyer Party may retain
a copy of Confidential Information solely to satisfy such requirements, provided that such Buyer
Party must otherwise strictly maintain the confidentiality thereof; and (b) a Buyer Party may
disclose Confidential Information to the extent required to be disclosed pursuant to the Colorado
Open Records Act or pursuant to court order or subpoena, but only after such Buyer Party has
notified Seller of any request, court order or subpoena seeking or requiring disclosure of
Confidential Information and has given Seller the reasonable opportunity to appeal or challenge
the same. Buyer agrees that money damages would not be a sufficient remedy for any breach of
the confidentiality provisions of this Agreement by Buyer or any Buyer Parties and Seller will be
entitled to equitable relief, including injunction and specific performance, as a remedy for any such
breach. The confidentiality covenants and obligations set forth in this Agreement will survive for
a period of two (2) years after (i) any termination of this Agreement prior to Closing, as to all
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Section H, Item 2.
24
Agreement of Purchase and Sale
RI# 8457, Fort Collins, CO
Confidential Information, or (ii) the Closing, but only as to Confidential Information relating to
Seller or any Seller Parties and not as to Confidential Information relating solely to the Property.
Section 7.4. Time. Time is of the essence in the performance of each of the Parties’
respective obligations under this Agreement; provided, however, that if a deadline or date for
performance, or for the giving or receipt of a notice, falls on a day that is not a Business Day, such
deadline or date shall be deemed extended to the next Business Day.
Section 7.5. Nonliability of Officials, Agents and Employees. In no event
whatsoever will any Seller Parties or Buyer Parties have any recourse with respect to this
Agreement or any of the Closing Documents against, and no liability will be asserted with respect
to this Agreement or any Closing Documents against, any of Seller’s or Buyer’s respective
members, partners, shareholders, trustees, employees, agents, directors, officers, or other
owners, principals, representatives, or Affiliates, or the respective constituents thereof, or any
council member, board member, commissioner, official, employee, consultant, attorney or agent
of Buyer (collectively, the “Exculpated Persons”), and in no event whatsoever will any of the
Exculpated Persons have or be deemed to have undertaken or assumed any personal liability for
any obligations entered into by Seller or Buyer, as applicable, under this Agreement or any of the
Closing Documents, and regardless of whether any such Persons negotiated or executed this
Agreement or any of the Closing Documents on behalf of either Seller or Buyer, as applicable
Section 7.6. Attorneys’ Fees. In addition to the remedies provided in Article 6 above,
if there is any litigation, action or other proceeding between the Parties (“Action”) to enforce any
provisions or rights arising under or in connection with this Agreement or the Closing Documents,
the Party that is determined to have prevailed in such Action will also be entitled to an award
against the non-prevailing Party for all costs and expenses, including but not limited to reasonable
attorneys’ fees, reasonably incurred by the prevailing Party in connection with the prosecution or
defense of such Action which shall not be included in the Maximum Amount set forth in Section
6.3(b). The Parties additionally agree, with respect to any provision of this Agreement that allows
either Party to charge attorneys’ fees or costs to, or recover or collect attorneys’ fees or costs
from, the other Party, that such provision will be construed to also mean and include In-house
Fees (as defined above). The provisions of this Section will survive the Closing or any earlier
termination of this Agreement.
Section 7.7. Merger of Obligations. Obligations that are expressly provided in this
Agreement to survive or be performed after the Closing will not merge with the transfer of legal
title to the Property but will remain in effect until fulfilled; all other obligations of the Parties will
merge with and be extinguished upon the transfer of legal title to the Real Property to Buyer at
Closing.
Section 7.8. Assignment. Subject to the provisions of this Section, Buyer may, by
written notice given to Seller not less than ten (10) Business Days prior to the Closing, assign
Buyer’s rights and obligations under this Agreement to a Permitted Assignee. Except for any
assignment to a Permitted Assignee, Buyer’s rights and obligations under this Agreement are not
transferable, assignable or delegable, directly or indirectly, without the prior written consent of
Seller, which consent may be given or withheld in Seller’s sole and absolute discretion. Any
transfer, assignment or delegation (to a Permitted Assignee or otherwise) must be made pursuant
to a written agreement meeting the requirements of this Section, which agreement will include
(without limitation) provisions stating that (a) the transfer, assignment or delegation does not
release, diminish or otherwise affect the obligations of the original Buyer under this Agreement,
including the original Buyer’s obligations to pay the Purchase Price at Closing and to indemnify
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Section H, Item 2.
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Agreement of Purchase and Sale
RI# 8457, Fort Collins, CO
Seller and the other Seller Parties in accordance with the terms hereof; and (b) the Permitted
Assignee (or other approved transferee, assignee or delegee) expressly agrees for the benefit of
Seller and the Seller Parties that (i) such Person is assuming all obligations of the original Buyer
under this Agreement, and (ii) the conveyance of the Property to such Person will be subject to
all of the terms, provisions, conditions and limitations set forth in this Agreement to the same
extent as if such Person was the original Buyer executing this Agreement. Any attempted transfer,
assignment or delegation by Buyer in contravention of this Section will be null and void unless
accepted in writing by Seller at Seller’s sole option (but shall be deemed to have been accepted
if the Closing has occurred by Seller conveying to the transferee, assignee or delegee). Subject
to the limitations described herein, this Agreement will inure to the benefit of and be binding upon
the Parties and their respective successors and assigns.
Section 7.9. 1031 Exchange. Each Party may structure its acquisition or sale, as
applicable, as part of a like-kind exchange under Section 1031 of the Code. Each Party will
reasonably cooperate with the other (at no cost or liability to the cooperating Party) in effectuating
such a like-kind exchange, including signing such documents as may be reasonably and
customarily necessary to acknowledge such exchange; provided, however, that (a) the Closing
will not be delayed thereby, (b) the exchanging Party will not be released from any liability or
obligation under this Agreement, and (c) the cooperating Party will not incur any additional liability
or undertake any additional obligation as a result of any such like-kind exchange. The Party
employing the like-kind exchange structure will pay all costs and expenses associated with
effectuating such exchange.
Section 7.10. Governing Law; Jurisdiction and Venue. THIS AGREEMENT WILL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE IN
WHICH THE REAL PROPERTY IS LOCATED (the “Property State”). For the purposes of any
suit, action or proceeding involving this Agreement, each Party expressly submits to the
jurisdiction of all federal and state courts sitting in the Property State and consents that any order,
process, notice of motion or other application to or by any such court or a judge thereof may be
served within or without such court’s jurisdiction by registered mail or by personal service,
provided that a reasonable time for appearance is allowed, and each Party agrees that such
courts will have jurisdiction over any such suit, action or proceeding commenced by any Party.
Each Party irrevocably waives any objection that it may now or hereafter have to the laying of
venue of any suit, action or proceeding arising out of or relating to this Agreement brought in any
federal or state court sitting in the Property State and further irrevocably waives any claim that
any such suit, action or proceeding brought in any such court has been brought in an inconvenient
forum. The foregoing provisions are not intended to establish the Property State as the exclusive
forum for any suit, action or proceeding involving this Agreement, but merely to establish the
consent and agreement of each Party to such non-exclusive jurisdiction and venue in the event
of any contest or dispute over such matters.
Section 7.11. Waiver of Trial by Jury. TO THE FULLEST EXTENT PERMISSIBLE
UNDER APPLICABLE LAW, EACH PARTY WAIVES, IRREVOCABLY AND
UNCONDITIONALLY, TRIAL BY JURY IN ANY ACTION BROUGHT ON, UNDER OR BY
VIRTUE OF OR RELATING IN ANY WAY TO THIS AGREEMENT, ANY OF THE CLOSING
DOCUMENTS, THE PROPERTY, OR ANY CLAIMS OR ACTIONS PERTAINING TO ANY OF
THE FOREGOING.
Section 7.12. Interpretation of Agreement. The Article, Section and other headings
of this Agreement are for convenience of reference only and shall not be construed to affect the
meaning of any provision contained in this Agreement. Where the context so requires, (a) the
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Section H, Item 2.
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Agreement of Purchase and Sale
RI# 8457, Fort Collins, CO
use of the singular shall include the plural and vice versa and the use of the masculine shall
include the feminine and the neuter; (b) the words “herein”, “hereof” and “hereunder” and other
words of similar import refer to this Agreement as a whole and not to any particular Article, Section
or other subdivision; and (c) the words “including” and “include” and other words of similar import
will be deemed to be followed by the phrase “without limitation.” All monetary amounts expressed
in “dollars” or designated by a “$”, “USD” or “US$” symbol or abbreviation refer to a monetary
amount payable within the United States in the current lawful, dollar-denominated official currency
of the United States of America. The terms and provisions of this Agreement represent the result
of negotiations by the Parties, and each Party has been represented by counsel of, and to the
extent of, such Party’s own choosing, and neither Party has acted under any duress or
compulsion, whether legal, economic or otherwise. Consequently, the terms and provisions of
this Agreement shall be interpreted and construed in accordance with their usual and customary
meanings, and the Parties each waive the application of any rule of law that might otherwise be
applicable that ambiguous or conflicting terms or provisions contained in this Agreement shall be
interpreted or construed against the Party that prepared (or whose attorney prepared) the
executed Agreement or any earlier draft of this Agreement or the provision in question.
Section 7.13. Amendments; No Waiver. No modification, waiver, amendment or
discharge of or under this Agreement will be valid unless contained in a writing signed by the
Party against whom enforcement is sought. No waiver by Seller or Buyer of a breach of any of
the terms, covenants or conditions of this Agreement will be construed or held to be a waiver of
any succeeding or preceding breach of the same or any other term, covenant or condition
contained in this Agreement.
Section 7.14. No Recording. Neither this Agreement nor any memorandum or short
form thereof may be recorded by Buyer or any Buyer Party. Any such recording of this Agreement
or a memorandum or short form hereof by Buyer or any Buyer Party will constitute an immediate
Buyer Default under this Agreement, and in addition to Seller’s other remedies therefor, Seller
may conclusively establish the complete release and removal of such recorded document simply
by recording a copy of this provision of this Agreement.
Section 7.15. No Third Party Beneficiary. Except as may be expressly stated herein,
the provisions of this Agreement do not and are not intended to benefit any third parties.
Section 7.16. Severability. If, in any action to enforce this Agreement, any one or more
of the covenants, agreements, conditions, provisions, or terms of this Agreement is, in any respect
or to any extent (in whole or in part), held to be invalid, illegal or unenforceable for any reason, all
remaining portions thereof that are not so held, and all other covenants, agreements, conditions,
provisions, and terms of this Agreement, will not be affected by such holding, but will remain valid
and in force to the fullest extent permitted by law.
Section 7.17. Drafts Not an Offer. The submission of a draft of this Agreement by one
Party to another is not intended by either Party to be an offer to enter into a legally binding contract
with respect to the purchase and sale of the Property. The Parties will not be legally bound in any
manner with respect to a purchase and sale of the Property unless and until each of Seller and
Buyer have duly executed this Agreement and the Parties have delivered that fully executed
Agreement to Escrow Agent. Any submission by Buyer of an executed copy of this Agreement
to Seller shall be construed solely as an offer by Buyer to purchase the Property which may be
accepted by Seller only by Seller’s execution of such Agreement or a counterpart as provided
below.
35
Section H, Item 2.
27
Agreement of Purchase and Sale
RI# 8457, Fort Collins, CO
Section 7.18. Consent Standards. Unless expressly provided otherwise in this
Agreement, any consent, determination, election or approval required to be obtained, or permitted
to be given, by or on behalf of either Party under this Agreement will be given, withheld or made
(as the case may be) by such Party in the exercise of such Party’s commercially reasonable
discretion and within a commercially reasonable period of time.
Section 7.19. Counterparts; Signatures. This Agreement may be executed in two or
more counterparts, each of which shall be deemed an original, but all of which taken together will
constitute one and the same Agreement. Signatures performed, transmitted, or provided by
electronic means shall have same legal effect as the delivery of original hand-written signatures.
Each Party agrees to promptly deliver a “hard copy” of this Agreement bearing such Party’s
original manual ink signature to the other Party upon request, but a failure to do so will not affect
the enforceability of this Agreement.
Section 7.20. Publicity. Neither Party will issue, or cause or permit its Affiliates to
issue, any press release or public statement of any sort with respect to the transactions
contemplated by this Agreement that expressly names or reasonably identifies the other Party or
any Affiliate of the other Party (a “Press Release”) before Closing, except for a mutually
acceptable joint statement (or if reasonably approved by Seller, a unilateral statement by Buyer)
issued at the time this Agreement is entered into by the Parties. Upon or after the Closing, neither
Party will issue, or cause or permit its Affiliates to issue, any Press Release without the prior
written consent of the other Party, which consent will not be unreasonably withheld, conditioned
or delayed. If either Party desires to issue a Press Release, then prior to any issuance such Party
will give a copy of the proposed Press Release to the other Party for its review, comment and
approval. If no objection or comments are received from the other Party within five (5) Business
Days after the other Party receives such proposed Press Release for review, consent to the Press
Release shall be deemed given by the reviewing Party. The foregoing does not limit or preclude
disclosures made to comply with a Party’s regulatory reporting requirements, including those of
the U.S. Securities and Exchange Commission or any stock exchange, or any disclosure
requirements applicable to Buyer as a Governmental Authority. The provisions of this Section
shall survive the Closing or any earlier termination of this Agreement.
Section 7.21. ROFR Waiver. Each Party’s obligation to close the sale contemplated
by this Agreement is expressly subject to Seller’s receipt within thirty (30) days of the Effective
Date of either (a) an executed waiver by Tenant of any right of first offer or refusal Tenant may
have under the Lease (any such right being a “ROFR”) with respect to the sale of the Property to
Buyer, or (b) the passage of such period of time as may be necessary following Seller’s written
request for such a waiver to constitute a “deemed” waiver or refusal by Tenant of the ROFR
pursuant to the terms of the Lease (whether a written or deemed waiver, the “ROFR Waiver”).
Seller will provide written notice to Buyer when it provides the notice under the ROFR to Tenant
and when the ROFR Waiver is obtained. If Tenant exercises the ROFR, this Agreement will
automatically terminate. If this Agreement is terminated pursuant to this Section, the Deposit will
be paid to Buyer and thereafter the Parties will have no further rights or obligations under this
Agreement except for Obligations Surviving Termination.
Section 7.22. Governmental Immunity. Buyer, its officers and employees are relying
on and do not waive or intend to waive by any provision of this Agreement, the monetary
limitations or any other rights, immunities, and protections provided by the Colorado
Governmental Immunity Act, §§ 24-10-101, et seq., as amended, or otherwise available to the
Buyer and its officers and employees.
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Section H, Item 2.
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Agreement of Purchase and Sale
RI# 8457, Fort Collins, CO
IN WITNESS WHEREOF, Buyer and Seller have caused this Agreement to be executed
and delivered by their duly authorized representatives as of the Effective Date written above.
BUYER:
FORT COLLINS URBAN RENEWAL AUTHORITY,
a body corporate duly organized and existing as an
urban renewal authority under the laws of the state of Colorado
By:
Name:
Title:
SELLER:
VEREIT REAL ESTATE, L.P.,
a Delaware limited partnership
By: VEREIT Real Estate GP, LLC
a Delaware limited liability company,
its General Partner
By:
Name:
Title:
ESCROW AGENT’S ACCEPTANCE
The foregoing fully executed Agreement is accepted by the undersigned as the “Escrow
Agent” under this Agreement this _____ day of ____________, 2024. Escrow Agent accepts the
engagement to handle the escrow established by this Agreement in accordance with the terms
set forth in this Agreement.
FIRST AMERICAN TITLE INSURANCE COMPANY
By:
Name:
Title:
37
Section H, Item 2.
Agreement of Purchase and Sale
RI# 8457, Fort Collins, CO
EXHIBIT A
LEGAL DESCRIPTION OF THE LAND
38
Section H, Item 2.
Agreement of Purchase and Sale
RI# 8457, Fort Collins, CO
EXHIBIT B
DEED
[to be conformed to state recording requirements]
WHEN RECORDED MAIL TO:
[_______________________________]
SPECIAL WARRANTY DEED
For and in consideration of Ten Dollars ($10.00) and other good and valuable
consideration, ___________________, a ____________________ (“Grantor”), hereby grants
and conveys to ____________________, a _________________ (“Grantee”), the real property
located in _________________________, legally described as:
See legal description set forth in Exhibit A attached and incorporated by this
reference (the “Property”).
together with all right, title and interest of Grantor in and to (a) all buildings, structures, and
improvements located on the Property; (b) all appurtenances, hereditaments, easements, rights-
of-way, reversions, remainders, development rights, well rights, water rights, and air rights; (c) all
oil, gas, and mineral rights not previously reserved; and (d) any other rights or privileges
appurtenant to the Property or used in connection therewith.
SUBJECT TO current real property taxes and all unpaid non-delinquent general and
special taxes, bonds and assessments; all liens, covenants, conditions, reservations, rights,
easements, interests, rights of way, and restrictions of public record; all leases and any other
occupancy agreements in effect; all zoning ordinances and regulations and any other laws,
ordinances or governmental regulations restricting or regulating the use, occupancy or enjoyment
of the Property; and all matters visible upon or about the Property or that would be disclosed by
an accurate survey of the Property.
TO HAVE AND TO HOLD the Property unto said Grantee and its successors and assigns
forever;
And Grantor will warrant and defend title to the Property conveyed hereby unto said
Grantee against the lawful claims and demands of all claiming by, through or under Grantor, but
no other.
Dated this ___ day of _______________, 202__.
GRANTOR
By:
Name:
Title:
[ADD APPROPRIATE NOTARIAL ACKNOWLEDGMENT]
39
Section H, Item 2.
Agreement of Purchase and Sale
RI# 8457, Fort Collins, CO
Exhibit A to Deed
Legal Description of Property
40
Section H, Item 2.
Agreement of Purchase and Sale
RI# 8457, Fort Collins, CO
EXHIBIT C
BILL OF SALE
THIS BILL OF SALE (this “Bill of Sale”) is made as of the ____ day of _____________,
202__ (the “Sale Date”) between _____________________, a _________________ (“Seller”),
and ______________________, a _________________ (“Buyer”).
In connection with the sale by Seller to Buyer of the real property described on Exhibit A
attached hereto (the “Property”) pursuant to an Agreement of Purchase and Sale dated as of
________, 202[ ] (as may have been amended or assigned, the “Purchase Agreement”), and
for and in consideration of Ten Dollars ($10.00) and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, Seller hereby transfers and conveys
to Buyer all right, title and interest of Seller in and to any equipment, machinery, furnishings, and
other tangible personal property owned by Seller and located within or upon the Property (the
“Personal Property”). The Personal Property expressly excludes any motorized vehicles, and
any property owned by any utilities company, property management company, or other third party.
SELLER HEREBY REPRESENTS AND WARRANTS THAT IT HAS NOT PREVIOUSLY
CONVEYED ITS RIGHT, TITLE OR INTEREST IN THE PERSONAL PROPERTY TO ANY
THIRD PARTY. BY ACCEPTANCE OF THIS BILL OF SALE, BUYER ACKNOWLEDGES AND
AGREES THAT BUYER ACCEPTS THE PERSONAL PROPERTY AS IS, WHERE IS, AND
WITH ALL FAULTS, WITHOUT ANY REPRESENTATION OR WARRANTY, EXPRESSED OR
IMPLIED, FROM SELLER EXCEPT AS OTHERWISE PROVIDED HEREIN. SELLER
EXPRESSLY DISCLAIMS ANY AND ALL EXPRESS OR IMPLIED WARRANTIES WITH
RESPECT TO THE PERSONAL PROPERTY, INCLUDING WITHOUT LIMITATION ANY
IMPLIED WARRANTY AS TO MERCHANTABILITY OR FITNESS FOR ANY PARTICULAR
PURPOSE.
This Bill of Sale (i) will be governed by and construed in accordance with the laws of the
State in which the Property is located applicable to contracts made and performed entirely therein;
(ii) may be executed by the parties in one or more counterparts, each of which shall be deemed
an original, but all of which together will constitute one and the same instrument; and (iii) is
executed and delivered pursuant to, and is subject to the applicable terms and conditions of, the
Purchase Agreement.
[SIGNATURES COMMENCE ON THE NEXT PAGE]
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Section H, Item 2.
Agreement of Purchase and Sale
RI# 8457, Fort Collins, CO
IN WITNESS WHEREOF, Seller and Buyer have caused this Bill of Sale to be duly
executed as of the Sale Date written above.
SELLER
[ ],
a(n)
By:
Name:
Title:
BUYER
[ ],
a(n)
By:
Name:
Title:
EXHIBIT A LEGAL DESCRIPTION
42
Section H, Item 2.
Agreement of Purchase and Sale
RI# 8457, Fort Collins, CO
EXHIBIT D
ASSIGNMENT OF
INTANGIBLE PROPERTY
THIS ASSIGNMENT OF INTANGIBLE PROPERTY (this “Assignment”) is made as of
the ____ day of _____________, 202__ (the “Assignment Date”), by and between
_____________________, a _____________ (“Assignor”) and ________________________,
a ________________ (“Assignee”).
WHEREAS, Assignor is transferring Assignor’s interest in and to the real property
described on Exhibit A attached hereto (the “Property”) to Assignee as of the Assignment Date
pursuant to an Agreement of Purchase and Sale dated as of ____________, 202__ (as may have
been amended or assigned, the “Purchase Agreement”); and
WHEREAS, Assignor desires to transfer to Assignee all of Assignor’s right, title and
interest in and to any intangible property owned by Assignor and relating solely and specifically
to the Property, including any transferable licenses, permits, approvals, certificates of occupancy,
or entitlements (the “Intangible Property”), but subject in all respects to any exclusions or
limitations as may be set forth in the Purchase Agreement.
NOW, THEREFORE, for and in consideration of Ten Dollars ($10.00) and other good and
valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Assignor
and Assignee agree as follows:
1. Assignor hereby assigns and transfers to Assignee all of Assignor’s right, title,
interest in and to the Intangible Property. This Assignment shall not be construed as a
representation or warranty by Assignor as to the transferability of the Intangible Property, and
Assignor shall have no liability to Assignee in the event that any or all of the Intangible Property
(a) is not transferable to Assignee or (b) is canceled or impaired by reason of this Assignment or
any acts of Assignee.
2. This Assignment is made by Assignor without recourse and without any express
or implied representation or warranty of any kind, except as may be expressly set forth in the
Purchase Agreement.
3. This Assignment will inure to the benefit of and will be binding upon the parties
hereto and their respective successors and assigns. This Assignment is executed and delivered
pursuant to, and is subject to the applicable terms and conditions of, the Purchase Agreement.
4. This Assignment will be governed by and construed in accordance with the laws
of the State in which the Property is located applicable to contracts made and performed entirely
therein.
5. The parties agree that this Assignment may be executed by the parties in one or
more counterparts, each of which shall be deemed an original, but all of which together will
constitute one and the same instrument.
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Section H, Item 2.
Agreement of Purchase and Sale
RI# 8457, Fort Collins, CO
IN WITNESS WHEREOF, Assignor and Assignee have caused this Assignment to be duly
executed as of the Assignment Date written above.
ASSIGNOR
[ ],
a(n)
By:
Name:
Title:
ASSIGNEE
[ ],
a(n)
By:
Name:
Title:
EXHIBIT A LEGAL DESCRIPTION
44
Section H, Item 2.
Agreement of Purchase and Sale
RI# 8457, Fort Collins, CO
EXHIBIT E
ESCROW INSTRUCTIONS
1. Escrow Agent is authorized to take all appropriate action necessary to comply with
this Agreement.
2. All money payable under this Agreement prior to Closing will be paid to Escrow
Agent, unless otherwise specified. All funds received by Escrow Agent will be deposited by
Escrow Agent in a federally-insured account in a State or National Bank (FDIC insured) unless
otherwise directed in writing by both Seller and Buyer. Escrow Agent may not commingle the
Deposit with other funds held in its “trustees account”. Escrow Agent will invest the Deposit in an
interest-bearing account meeting the above requirements if so directed by Buyer. Any interest
earned on the Deposit will belong to Buyer and be treated and reported as the income of Buyer
(regardless of the ultimate disposition of the Deposit) and Buyer will be responsible for paying all
taxes on any interest earned on the Deposit, which obligation will survive the Closing.
3. Disbursement of funds from Escrow Agent to Seller or Buyer will be made by wire
transfer. Unless otherwise specified by a Party, disbursement of any funds to any payee other
than Seller or Buyer may be made by check of Escrow Agent. Escrow Agent will be under no
obligation to disburse any funds represented by check or draft and no check or draft will be
payment to Escrow Agent in compliance with any of the requirements hereof until it has
commercially reasonable assurance that such check or draft has been or will be honored.
4. Any Party seeking release or disbursement of the Deposit prior to Closing will
make written demand therefor upon both Escrow Agent and the other Party. If Escrow Agent
intends to release the Deposit to either Party pursuant to this Agreement (other than at Closing),
then Escrow Agent will give the other Party not less than five (5) Business Days prior written
notice of such fact, and if Escrow Agent receives written notice during such five (5) Business Day
period that such other Party objects to the release, then Escrow Agent will not release the Deposit
and any such dispute will be resolved as provided herein. Escrow Agent will promptly notify both
Parties of any actual release of the Deposit. All notices will be provided as required under the
notice provisions of this Agreement.
5. When this Agreement and all title requirements have been complied with (including
without limitation all conditions set forth in any closing instructions agreed to by Escrow Agent),
Escrow Agent will deliver, file or record in the appropriate public office all necessary documents,
disburse all funds and instruct the Title Company to issue the appropriate title insurance
policy(ies).
6. Escrow Agent may for reasonable cause resign upon ten (10) days written notice
to the Parties; provided that Escrow Agent will transfer the escrow together with all documents
and funds to an escrow agent acceptable to both Seller and Buyer, or if Seller and Buyer cannot
agree upon an acceptable escrow agent, then Escrow Agent will have the right to resign and
interplead all funds and documents to a court of competent jurisdiction.
7. Escrow Agent may at its election, in the event of any conflicting demands made
upon it concerning this Agreement where this Agreement does not clearly specify the course of
action Escrow Agent is required to take, hold any money and documents deposited under this
Agreement that are the subject of such conflict until it receives mutual instructions by all Parties
45
Section H, Item 2.
Agreement of Purchase and Sale
RI# 8457, Fort Collins, CO
or until a civil action will have been concluded in a court of competent jurisdiction, determining the
rights of the Parties. In the alternative, in such situation Escrow Agent may, at its discretion,
commence a civil action to interplead any conflicting demands to a court of competent jurisdiction.
8. Escrow Agent will be entitled to rely upon any judgment, certification, demand or
other writing delivered to it under this Agreement without being required to determine the
authenticity or the correctness of any fact stated therein, the propriety or validity thereof, or the
jurisdiction of a court issuing any such judgment. Escrow Agent may act in reliance upon (a) any
instrument or signature believed to be genuine and duly authorized, and (b) advice of counsel in
reference to any matter or matters connected therewith.
9. Escrow Agent will have no liability whatsoever arising out of or in connection with
its activity as escrow agent except in the case of its negligence or willful misconduct or a breach
by Escrow Agent of these Escrow Instructions, and Seller and Buyer jointly and severally agree
to indemnify and hold harmless Escrow Agent from all loss, cost, claim, damage, liability and
expenses (including reasonable attorneys’ fees) that may be incurred by reason of its acting as
escrow agent unless caused by Escrow Agent’s negligence or willful misconduct or a breach by
Escrow Agent of this Agreement.
10. If escrow fails to close because of Seller’s default, Seller will be liable for any
accrued costs or cancellation charges of Escrow Agent. If escrow fails to close because of
Buyer’s default, Buyer will be liable for any accrued costs or cancellation charges of Escrow
Agent. If escrow fails to close as a result of any other termination of this Agreement, the Party
terminating the Agreement will be liable for any accrued costs or cancellation charges of Escrow
Agent.
11. Escrow Agent will be “the person responsible for closing” the transaction pursuant
to Internal Revenue Code Section 6045(e), including preparing and filing the applicable IRS
Form(s) 1099-S in compliance with Section 6045(e).
12. The provisions of these Escrow Instructions will survive the Closing or any earlier
termination of this Agreement.
46
Section H, Item 2.
Agreement of Purchase and Sale
RI# 8457, Fort Collins, CO
SCHEDULE 1
SELLER DELIVERIES
1. Seller’s existing environmental site assessment
2. Seller’s existing title policy
3. Seller’s existing survey of the Real Property
4. The Lease Termination Agreement between Seller and Tenant (with redactions of
economic terms)
5. All service contracts, maintenance agreements, equipment leases, utility agreements
and parking agreements to which Seller is a party relating to or affecting the Property.
[None]
6. Information about any insurance claims made by Seller or a Seller Party with respect to
the Property in the last 10 years [None]
7. Folder of construction plans related to the Property
8. Zoning letter dated September 22, 2010
9. Certificate of Occupancy dated March 6, 2003
10. A copy of the Lease between Seller and Tenant (with redactions of economic terms)
47
Section H, Item 2.
31817592.1
RESOLUTION NO. 138
OF THE BOARD OF COMMISSIONERS OF THE FORT COLLINS URBAN RENEWAL
AUTHORITY ADOPTING A SUPPLEMENTAL 2024 BUDGET RESOLUTION
WHEREAS, the Fort Collins Urban Renewal Authority (“Authority”) on December 4,
2023 adopted the annual budget for the fiscal year beginning January 1, 2024 and ending December
31, 2024 per Fort Collins Urban Renewal Authority Resolution No. 129, pursuant to and in
accordance with Colorado local budgeting requirements and Colorado statute; and
WHEREAS, the Authority is entering into an Agreement of Purchase and Sale (“Purchase
Agreement”) to acquire the property located at 1636 N. College Ave., Fort Collins, Colorado
which requires paying into escrow a deposit of $250,000.00 within three (3) business days of the
effective date of the Purchase Agreement; and
WHEREAS, the amended 2024 budget, as revised by this Resolution, remains in balance
as required by law; and
WHEREAS, this Resolution allocating funds to pay the deposit into escrow is within
the existing Authority obligations and revenue funds available and is appropriate and
necessary.
NOW, THEREFORE, BE IT RESOLVED BY THE BOARD OF COMMISSIONERS OF
THE FORT COLLINS URBAN RENEWAL AUTHORITY:
Section 1. The foregoing Recitals are incorporated herein by this reference.
Section 2. That the 2024 appropriation for the North College Plan Area is hereby
modified to provide for this $250,000.00 budget request, and the remittance and reappropriation
of the funds set forth in this Resolution is hereby authorized.
Section 3. The Authority acknowledges that a supplemental budget resolution related
to the Authority’s 2025 budget is necessary to account for the remainder of the purchase price
under the Purchase Agreement.
Section 4. The Authority finds that the required notice and opportunity for public
inspection, were properly made and held in accordance with C.R.S. §§ 29-1-106 and 29-1-109.
Section 5. This Resolution is enacted as a supplemental budget and appropriation
pursuant to C.R.S. § 29-1-109.
Section 6. If necessary, the Secretary of the Authority is directed to file a certified copy
of this Resolution with the Division of Local Government, Department of Local Affairs, State of
Colorado.
Passed and adopted at a regular meeting of the Board of Commissioners of the City of Fort Collins
Urban Renewal Authority this 2nd day of December, 2024
48
Section H, Item 2.
31817592.1
FORT COLLINS URBAN RENEWAL
AUTHORITY
By: ________________________________
Chair
ATTEST:
_______________________________
Secretary
49
Section H, Item 2.
31818556.1
RESOLUTION NO. 139
OF THE BOARD OF COMMISSIONERS OF THE FORT COLLINS URBAN RENEWAL
AUTHORITY ADOPTING A SUPPLEMENTAL 2025 BUDGET RESOLUTION
WHEREAS, the Fort Collins Urban Renewal Authority (“Authority”) on October 24,
2024 adopted the annual budget for the fiscal year beginning January 1, 2025 and ending December
31, 2025 per Fort Collins Urban Renewal Authority Resolution No. 136, pursuant to and in
accordance with Colorado local budgeting requirements and Colorado statute; and
WHEREAS, the Authority is entering into an Agreement of Purchase and Sale (“Purchase
Agreement”) to acquire the property located at 1636 N. College Ave., Fort Collins, Colorado for
the purchase price of $7,636,050.00 (less the initial deposit of $250,000.00 from the 2024
Authority budget) which, if the Authority proceeds with the transaction after the Diligence Period
(as defined in the Purchase Agreement), will be due upon the Closing Date (as defined in the
Purchase Agreement); and
WHEREAS, the amended 2025 budget, as revised by this Resolution, remains in balance
as required by law; and
WHEREAS, this Resolution allocating funds to pay the deposit into escrow is within
the existing Authority obligations and revenue funds available and is appropriate and
necessary.
NOW, THEREFORE, BE IT RESOLVED BY THE BOARD OF COMMISSIONERS OF
THE FORT COLLINS URBAN RENEWAL AUTHORITY:
Section 1. The foregoing Recitals are incorporated herein by this reference.
Section 2. That the 2025 appropriation for the North College Plan Area is hereby
modified to provide for this $7,386,050.00 budget request, and the remittance and reappropriation
of the funds set forth in this Resolution is hereby authorized.
Section 3. The Authority acknowledges that a supplemental budget resolution related
to the Authority’s 2024 budget is necessary to account for the initial $250,000.00 deposit escrowed
and put towards the Purchase Price under the Purchase Agreement.
Section 4. The Authority finds that the required notice and opportunity for public
inspection, were properly made and held in accordance with C.R.S. §§ 29-1-106 and 29-1-109.
Section 5. This Resolution is enacted as a supplemental budget and appropriation
pursuant to C.R.S. § 29-1-109.
Section 6. If necessary, the Secretary of the Authority is directed to file a certified copy
of this Resolution with the Division of Local Government, Department of Local Affairs, State of
Colorado.
50
Section H, Item 2.
31818556.1
Passed and adopted at a regular meeting of the Board of Commissioners of the City of Fort Collins
Urban Renewal Authority this 2nd day of December, 2024.
FORT COLLINS URBAN RENEWAL
AUTHORITY
By: ________________________________
Chair
ATTEST:
_______________________________
Secretary
51
Section H, Item 2.
December 2, 2024
Purchase and Sale Agreement
1636 North College Avenue
52
Section H, Item 2.
Background: Community Investment Plan
2
2019 -2020: CSU Institute for the Built Environment and The Family
Center/La Familia led series of community workshops
Identified three broad categories for investment:
Complete & Vibrant Neighborhood
Infrastructure Improvements
Community Hub
Former Albertsons property identified as challenge, opportunity, and
logical location for future community hub (“focal point”)
53
Section H, Item 2.
Background: Property
3
50,907 square feet building on 4.68 acres
Former grocery store constructed in
1994, closed in 2014 and vacant since
Owned by a REIT (“Seller”), and leased
by Albertsons (“Tenant”)
54
Section H, Item 2.
Background: Purchase Process
4
In mid-2022, URA Staff began discussions
with Seller to explore a potential sale
between “willing” seller and buyer
Signed a non-binding Letter of Intent (not a
contract) in September 2023
Purchase and Sale Agreement (“PSA”)
negotiations began, but then stalled
55
Section H, Item 2.
Background: Purchase Process
5
June 2024:
Statutory blight conditions
confirmed at the property
URA Board authorized use
of eminent domain, only if
necessary
56
Section H, Item 2.
Purchase and Sale Agreement
6
URA Staff and Seller have continued
to negotiate PSA terms
Seller and Tenant negotiated a
termination of their lease agreement
Seller and URA staff agreed on PSA
terms to be considered by URA Board;
Seller signed their part of the PSA
PSA provides URA right to purchase
the Property, but does not obligate
57
Section H, Item 2.
Purchase and Sale Agreement
7
KEY TERMS
•Price: $7,636,050
•Due Diligence (Inspection) Period: 180 days
•Closing: 35 days after end of Due Diligence
•Earnest Money Deposit: $250,000 (refundable)
58
Section H, Item 2.
Purchase and Sale Agreement
8
KEY TERMS
•Price: $7,636,050
$150 per square foot of building
Within range of internal and external valuation exercises
•Due Diligence (Inspection) Period: 180 days
URA Board enjoys sole discretion to proceed or terminate
PSA provides URA right to purchase the Property, but does
not create an obligation to purchase
59
Section H, Item 2.
Finances
9
North College Urban Renewal Plan Area fund balance is
currently estimated at $8.3 million, approximately $660,000
more than PSA purchase price
$2.4 million of revenue anticipated in 2025
Refundable earnest money deposit of $250,000 is due 3
days after contract is signed by URA; remainder of
purchase price due at closing
URA Board may consider assortment of financial options
to fund the purchase, including but not limited to
refunding of existing bond debt and/or a loan
60
Section H, Item 2.
Next Steps
10
URA Board to consider 3 resolutions:
1.Approval of PSA (authorize URA staff to sign)
2.Appropriate PSA contract purchase price
3.Appropriate earnest money deposit
URA staff and service providers to conduct
inspections and due diligence (physical,
legal, financial, etc.)
Continue strategic visioning process to
identify use and/or redevelopment concepts,
finances, and potential partners
61
Section H, Item 2.
Conclusion
11
Questions?
62
Section H, Item 2.