HomeMy WebLinkAboutAUGUSTA PROPERTIES SALES CONTRACT BETWEEN AUGUSTA PROPERTIES AND AUGUSTA GEORGIA
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STATE OF GEORGIA )
RICHMOND COUNTY )
THIS AGREEMENT, made and entered into, as ofthe _ day of February, 2008 between
AUGUSTA PROPERTIES, LTD. (hereinafter referred to as "SELLER"), and AUGUSTA,
GEORGIA, a political subdivision of the State of Georgia, (hereinafter referred to as "BUYER");
WITNE S SETH:
1. Seller has agreed to sell and Buyer to buy, on the terms and conditions hereinafter
set forth, the real property described on Exhibit "A" (the "Greene Street property") hereto attached.
2. The transaction shall consummated by an exchange of property as follows:
a. At the time of closing Buyer will convey, by limited warranty deed, the property
described on Exhibit A-I (the "Baker Street property"). The parties stipulate and
agree that the value of the Baker Street property as of the date of closing is
$200,000.00.
b. The sum of $487,000.00 shall paid into escrow the time of closing by Buyer. Of
such sum, $430,500.00 will be paid to _ as Escrow Agent to be held and
distributed for repairs as provided in the Escrow Agreement attached hereto as
Exhibit C. The balance of $57,500.00 will be paid to Bush Law Firm as Escrow
Agent to be held and distributed for relocation, housing and professional
expenses as provided in the Escrow Agreement attached hereto as Exhibit C-l.
3. The Seller hereby acknowledges receipt of $5,000.00 as earnest money, which is to
be deposited with Seller; which earnest money is to be applied as part payment towards the repair
escrow account to be funded at the time the sale is consummated.
4. (a) Seller agrees to furnish a marketable title to said property and agrees to
convey said property by general warranty deed to Buyer at the time the sale is consummated,
subj ect to:
1. Covenants and restrictions of record not violated by existing
improvements or the use of the property.
2. Zoning ordinances not violated by the existing improvements or the
use ofthe property.
3. Encumbrances and leases specified in this contract.
(b) Buyer shall furnish to Seller a written statement of objections affecting the
marketability of said title at least fifteen (15) days prior to the date set for closing. Ifthe Seller shall
be unable to convey title in accordance with the provisions of this contract, as a result of the
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property being affected by any encumbrance (other than taxes for the current year which constitute
a lien, but are not due and payable at the time of closing), outstanding interest or question of title
not expressly consented to herein by the Buyer which render the Seller's title to the premises
unmarketable, and which may according to reasonable expectations, be removed within thirty (30)
days, the Seller shall have the privilege to remove or satisfy the same and shall for this purpose, be
entitled to an adjournment of the closing of title for a period not exceeding fifteen (15) days. The
Seller shall not be required to bring any action or proceeding or otherwise incur any expense to
render the title to the premises marketable. The Buyer may, nevertheless accept such title as Seller
may be able to convey without reduction of the purchase price or any credit against same and
without liability on the part ofthe Seller.
5. The purchase and sale of the subject property shall be closed on or before
, 2008. Possession of the property shall be delivered to the
Buyer on or before June 15,2008.
6. Time is of the essence of this contract, and Seller and Buyer agree that such papers
as may be legally necessary to carry out the terms of this contract shall be executed and delivered by
such parties at the time this sale is consummated.
7. Seller warrants that when the sale is consummated the improvements on the
property will be in the same condition as they are on the date of this contract, natural wear and tear
excepted, and Seller specifically assumes the risk of loss or damage to said property until the
consummation of the sale. Should the premises be destroyed or substantially damaged before this
contract is consummated, then, at the election ofthe Buyer: (a) The contract may be canceled; (b)
Buyer may consummate the contract and receive such insurance as is paid on the claim of loss; if
there is no insurance the reasonable cost of repairing said improvements shall be subtracted from
the purchase price provided for in paragraph 2 hereof. The election is to be exercised by Buyer
within ten (10) days after the amount ofthe Seller's damage is determined.
8. Seller is to pay all liens, encumbrances, water charges and the like on said property,
for all transfer tax on Seller's deed. Buyer are to pay for the examination of title, intangible tax and
attorney fees. Taxes, interest on loan, rents and insurance premiums (if insurance is transferred to
Buyer) are to be prorated as of the date of closing.
9. Seller agrees that if this transaction is not consummated because of Seller's inability,
failure or refusal to convey marketable title, Seller shall return the earnest money to the Buyer.
Buyer agrees that if he fails or refuses to consummate this transaction for any reason, except lack of
marketable title in the Seller, the Seller shall have the option of suing for specific performance or of
terminating this contract. If the Seller shall elect to terminate this contract, the earnest money shall
not be refunded but shall be retained by the Seller as liquidated damages.
10. The special stipulations appearing on Exhibit B hereof, shall, if in conflict with the
printed matter contained herein, control.
11. This contract constitutes the sole and entire agreement between the parties and no
modification of this contract shall be binding unless attached hereto and signed by all parties to this
agreement. Representations, promises or inducements not included in this contract shall not be
binding upon any party hereto.
12. , All rights, powers, privileges and duties hereby granted or assumed shall inure to the
benefit of and shall be binding upon the successors, assigns, heirs, administrators and executors of
the parties hereto.
IN WITNESS WHEREOF, the undersigned have hereunto set their hands and seals, this
day of March, 2008.
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AUGUSTA, GEORGIA
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Exhibit "B"
SPECIAL STIPULA nONS
1. Seller shall have the right to remove all appliances, dishwashers, stoves, refrigerators
and fencing, if any, from the Greene Street property prior to possession being delivered.
All appliances, dishwashers, stoves, and refrigerators, if any, to remain with Baker
Street property. No consideration is to be paid for said items.
2. Both Baker Street property and Greene Street property are accepted in their current
condition.
3. Prior to the execution of this Agreement, Seller has had the opportunity to inspect and
examine the property to be swapped (the Baker Street property) and agrees to accept the
property in its current condition, "AS IS" with all faults. Seller to be responsible for,
and hold Buyer harmless for any deficiencies in the swapped property, including any
environment contamination.
4. Prior to the execution of this Agreement, Buyer has had the opportunity to inspect and
examine the property to be swapped (the Greene Street property) and agrees to accept
the property in its current condition, "AS IS" with all faults. Buyer to be responsible
for, and to the extent allowed by law, hold Seller harmless for any deficiencies in the
swapped property, including any environment contamination.
5. This contract is contingent upon Buyer acquiring fee simple title to the Baker Street
property prior to closing. In the event for any reason title cannot be conveyed prior to
the closing dated stated above, then the closing of the transaction contemplated herein
shall be postponed for a period not to exceed five (5) days from the date Buyer acquires
title to the Baker Street property.
6. Buyer and Seller warrant that at time of closing the transaction contemplated herein,
both the Baker Street property and the Greene Street property will be in the same
condition as it was on the date of acceptance, normal wear and tear excepted.
7. Seller shall pay transfer tax, if any. Each party shall pay their respective attorney fees.
8. Other than the transfer ofthe Baker Street property and the depositing of repair fees into
escrow, Buyer shall have no other obligation or responsibility for the repair,
maintenance or upkeep ofthe Baker Street property now or in the future.
9. Seller to transfer all existing leases for any residential rental units located in the
property. Seller to collect and retain any rental payments from the date of closing until
possession is delivered. In lieu of the payment of rent to Buyer from the date of closing
to the date of possession. Seller will maintain the property and continue in force hazard
and liability insurance on the premises and pay any utility expenses incurred up to and
including the date possession is delivered.
10. Seller to pay any moving or relocation expenses for any tenants remaining on the date
possession is delivered. In the event that one or more tenants of Seller remain in the
Greene Street property, on the date possession is given to Buyer, Seller to cooperate
with Buyer in bring any dispossory action.
11. Upon execution of this Agreement Seller shall have the right to access to the exterior
and grounds of the Baker Street property and access to the interior of the building upon
reasonable notice to Seller.
12. Any existing tenants at the Baker Street property who qualify for Project Based Section
8 Housing shall have priority for housing at the Baker Street property.
Exhibit "C"
[to be supplied by Seller]
NOTE: Escrow agreement must provide that any excess escrowed funds not needed for the repairs
to be refunded to Buyer at completion ofthe project.
- .
ESCROW FOR REPAIRS DEPOSIT AGREEMENT
TIDS ESCROW FOR REPAIRS DEPOSIT AGREEMENT (the "Agreement") is
made, as of --,2008 by and between Augusta Properties, L.P., a
Georgia limited partnership (the "Owner"), and Red Mortgage Capital, Inc., an Ohio corporation
(the "Lender").
RECITALS:
A. The Owner is the owner of all of that certain real property located in the City of Augusta,
in the County of Richmond, in the State of Georgia (the "Real Property"), on which is
constructed a certain rental apartment project known as Augusta Apartments, FHA
Project No. 061-35543 (the "Project" and, together with the Real Property, the
"Property").
B. The Lender is the holder of a HUD-insured loan (the "Loan") that is secured by a first
mortgage lien on the Property.
C. The Owner intends to incorporate a new rental apartment building (the "Baker Avenue
Property") into the Project which Baker Avenue Property is need of substantial repairs.
D. In order to assure the Lender and the Secretary of Housing and Urban Development
("HUD") that sufficient funds will be available to pay the cost ofthese Repairs, the
Owner has deposited the sum of $400,900.00 (the "Deposit") with the Lender to be held,
disbursed and administered pursuant to the terms of this Agreement.
NOW, THEREFORE, in consideration of the foregoing premises, the sum ofTen Dollars
($10.00) in hand paid, and other good and valuable consideration, the receipt and. sufficiency of
which are hereby acknowledged, the parties hereto, for themselves and for their respective
successors and assigns, hereby agree as follows:
1. Incorporation of Recitals. The foregoing recitals are hereby incorporated by reference as
if fully set forth herein.
2. Deposit. The Owner has made the Deposit with the Lender which by its execution of this
Agreement acknowledges it receipt.
3. Repairs and Disbursement Schedule. The repairs and/or improvements to be made to the
Project (the "Repairs") are generally described in the disbursement schedule attached hereto
as Exhibit A (the "Disbursement Schedule"). This Disbursement Schedule shall also serve
as a line item allocation of the Repairs to be made on the Project and shall serve as the basis
for disbursements to the Owner for completed portions of the Repairs. This Disbursement
Schedule (and allocation of funds) may be revised from time by the Owner with the prior
Rehab Escrow Agreement 09-15-04 M2M
Page 1
approval of HUD, the Lender and the hereinbelow described Inspector.
4. Escrow Account.
A. The Lender shall hold the Deposit in a segregated, interest bearing, escrow account,
with all interest earned thereon to be deposited in and be deemed a part of the
Deposit. All interest earnings shall be income to the Owner. For purposes of reporting
this income to the Internal Revenue Service, the Owner represents that its Federal Tax
Identification Number is 31 0994209.
B. The Lender shall inspect repairs and administer the Deposit in accordance with the
terms of this Agreement. Except for duties delegated to the Inspector and as may be
otherwise authorized by HUD, the Lender may not delegate or assign any of its duties
under the Agreement to any third party.
C. To secure the Owner's obligations under this Agreement and the Loan, the Owner
hereby grants a security interest in the Deposit to the Lender.
5. Administration and Inspection.
A. Administration Fee. The Owner has paid to the Lender on or prior to the date of this
Agreement: (1) an "Administration Fee" in the amount of$14,100.00, from which fee
the Lender shall pay the fee of a third-party inspector (the "Inspector") that it shall
select and retain to inspect the completion of the Repairs and (2) the amount of
$15,000.00 as payment of the legal fees the Lender incurred in this transaction.
B. Inspections. All inspections shall be made by the Inspector selected by the Lender.
Except as expressly provided otherwise herein, no portion of the Deposit may be
disbursed to the Owner until and unless the Inspector certifies to the Lender that the
Repairs for which payment or reimbursement is sought have been satisfactorily
completed and the Lender is; otherwise satisfied with the status of completed and
uncompleted Repairs.
C. Agreements With Contractors. The Owner shall provide the Lender and HUD with
copies of all subcontracts and supply contracts to the Lender. If any proposed
contractors, materialmen, and/or suppliers ("Contractors") have any "Identity Of
Interest" with the Owner (as that term may be defmed from time to time by HUD),
any fees paid to such parties must be reasonable, as determined by the Lender, not in
excess of fees that would be charged by non-identity of interest Contractors for the
same or similar work.
6. Owner's Agreement to Complete Repairs. Although the Owner represents and warrants
that the amount of the Deposit is adequate to complete the Repairs, if that estimate turns out
to be inadequate, the Owner, nonetheless, shall complete all required repairs at the Project
Rehab Escrow Agreement 09-15-04 M2M
Page 2
including but not necessarily limited to those described on the Disbursement Schedule and
shall pay any cost overruns from non-Project sources. The Owner further covenants and
agrees as follows: .
A. Completion of Repairs. To complete the Repairs, to the satisfaction of the Inspector.
All Repairs shall be done in a good and workmanlike manner, free and clear of any
mechanics' liens and encumbrances, and shall be made strictly in accordance with all
applicable ordinances and statutes and in accordance with the requirements of all
regulatory authorities and any rating or inspection organization, bureau, association or
office having jurisdiction over the Project.
B. Completion By Date Certain. To complete the Repairs no later than September 30,
2008, (the "Schedule").
C. Extension of Schedule Requires Consent of the Parties. That the Schedule or any
part thereof may be extended only with the prior written approval of the Lender and
HUD
D. Owner Responsible for Permits and Approvals. That the Owner has obtained or will
obtain and pay for, prior to commencement of any Repairs, all necessary permits and
approvals from all agencies or authorities as necessary for the commencement and
completion of the Repairs.
7. Withdrawals from Deposit.
A. Timing of Applications for Withdrawals. The Owner may make written
applications to the Lender for withdrawals of funds from the Deposit no more
frequently than once in each calendar month. Each application shall be made at
least 10 business days prior to the date the withdrawal is desired.
B. Amount Withdrawn. The Owner shall be entitled to only such amounts and for
such repairs as have been approved by the Inspector and the Lender in accordance
with the provisions hereof, and only up to the amount of the line item allocations in
the Disbursement Schedule.
C. Events of Default. Upon receipt of notice of the occurrence of an Event of Default
(defined below), the Lender shall make' no further disbursements from the Deposit
until and unless authorized to do so by HUD.
D. Owner's Request for Withdrawal. At such times as the Owner requests a
withdrawal, the Owner shall furnish to the Lender:
1. A request signed by the Owner seeking disbursement from the Deposit of
specified amounts for designated Contractors.
Rehab Escrow Agreement 09-15-04 M2M
Page 3
11. Owner's signed statement that no Event of DefauIt has occurred, and that no
event that, with the passage of time, the giving of notice, or both, will
constitute an Event of DefauIt, has occurred.
lll. Owner's sworn statement. Each such statement shall list, for each contract,
the amount paid to date, the amount currently requested, and the remaining
balance. Each such statement shall include a listing of the various contracts
entered into by the Owner and setting forth the names of Contractors, their
addresses, type of work or materials furnished, and amounts of the contracts,
and identifying any Identity Of Interest Contractors.
IV. Supporting waivers, affidavits, releases ofliens and material waivers (if
applicable) for Repairs made and/or materials provided since the last
withdrawal.
v. From each Contractor, an acknowledgment of payment and release oflien for
work performed and/or materials provided since the date of the prior
withdrawal of Funds. Such acknowledgement and release shall be prepared
in the form required by local lien laws and shall cover all work done, labor
performed and materials (including equipment and fixtures) furnished for the
Project. In addition, if the filing, in the public records of the county in which
the Project is located, of this Agreement and/or the construction contracts or
subcontracts under which the Repairs are to be completed will relieve the
Project from mechanics' and materialmen's liens, the Owner shall cause such
instrument(s) to be so filed and certified copies evidencing such filing to be
provided to the Escrow Administrator prior to any request for disbursement
of Funds from the Escrow Account.
E. Except as otherwise expressly provided herein, disbursements for Repairs shall
not be made unless such Repairs have been inspected in accordance with this
Agreement and the Lender shall have obtained a lien release from the party
receiving the funds covering all work and materials through the date of payment.
F. Disbursement shall be based on the actual invoices of Contractors for materials
and equipment or services actually provided, less a ten percent (10%) holdback
(the "Holdback Amount").
G. The Holdback Amount shall be held as part of the Deposit until all of the
Repairs have been completed to the satisfaction of the Inspector, the Lender, and
HUD and either:
1. the Lender has received fmal and enforceable lien waivers from all
parties who supplied materials or labor pursuant to this Agreement;
or
2. the time for the filing of any liens resulting from the Repairs has
Rehab Escrow Agreement 09-15-04 MlM
Page 4
passed and no liens or notices thereof have been filed. The Lender
may rely on a combination of legal opinions, title updates or title
insurance endorsements (to be provided by the Owner at the
Owner's sole cost and expense) in order to confirm the foregoing.
H. The Lender shall make all disbursement checks payable as follows:
1. To the Owner, but only if the Owner has provided to the Lender
acceptable proof that the Owner has paid the respective Contractor to
whom payment is due.
2. Otherwise, jointly to the Owner and the respective Contractor to
whom payment is due.
8. Deficit or Surplus Escrow Funds.
A. Deficit Funds. If the cost of completing the Repairs exceeds the amount available in
the Deposit, the Owner must complete the Repairs using fimds from non-Project
sources.
B. Surplus Funds. If, after the Repairs are completed and paid for, funds remain in the
Deposit, the Lender shall cause such funds to be remitted to the City of Augusta,
Georgia, with the prior approval ofHUD.
9. Right of Entry. The Lender, the Inspector and HUD, and their agents shall, at any and all
reasonable times, have the right to enter the Project to inspect all Repairs, materials,
equipment and fixtures furnished, installed or stored in or about the Real Property, and to
inspect all books, subcontracts and records of the Owner whether or not located at the
Project.
10. Events of Default. It shall be deemed a default by the Owner under this Agreement
'("Event of Default") if:
A. Owner Stops Work. The Owner abandons, ceases, or otherwise allows or suffers
work thereon to stop prior to completion for a period of more than 30 consecutive
calendar days, without the written concurrence of the Lender; or
B. Failure to Complete. The Owner fails to complete or prosecute the Repairs
continually and in good faith in a workmanlike manner and in accordance with the
Disbursement Schedule; or
C. Liens or Encumbrances. The Owner allows or suffers a mechanic's or
materialman's lien or other encumbrance to be filed against the Project (unless such
mechanic's lien is removed of record or its payment is otherwise assured to the
satisfaction of the Lender within thirty (30) days after filing); or
Rehab Escrow Agreement 09- I 5-04 M2M
Page 5
D. Material Misrepresentation. The Owner makes a material misrepresentation to
one or more parties to the Agreement; otherwise fails to comply with the terms of
this Agreement; or is in default, beyond any applicable cure period, under any
agreement between the Owner and HUD and/or the Lender
11. Remedies Upon An Event of Default.
A. Property is Subject to an FHA-Insured First Mortgage Regulatory
Agreement. Any Event of Default hereunder shall constitute a failure to maintain
the Property consistent with the requirements of the Regulatory Agreement
between the Owner and HUD.
B. Property is Subject to a Project-Based Section 8 HAP Contract. Any Event of
Default hereunder shall constitute a failure to maintain the Property consistent
with the requirements of any Section 8 Housing Assistance Payments Contract
between the Owner and HUD.
C. Property is Subject to a Mortgage Note. Any Event of Default hereunder shall be
deemed to be a default under the documents that evidence or secure the Mortgage
Note between the Owner and the Lender.
D. Completion of Repairs After an Event of Default. If an Event of Default occurs,
the Secretary shall have the right, but not the obligation, to proceed to complete
said work in accordance with the Drawings and Specifications, if applicable, and
pay the cost thereof from the Funds tendered to it by the Lender. For this purpose
the Owner hereby irrevocably authorizes and empowers HUD to do and perform
for it, the said Owner and in its name, place and stead, with full powers of
substitution, all matters and things which the Secretary shall in its sole judgment
deem necessary and proper to be done to effectuate the completion of the said
repairs and/or rehabilitation in accordance with Exhibit A. and to apply the Deposit
to the payment of debts contracted or incurred for work done or for materials
furnished therefor, or either, in and about said work and for all expenses, costs and
charges in connection therewith, and this power of attorney shall be HUD's full and
sufficient authority, and the orders given and signed by HUD as attorney-in-fact for
the Owner shall be good and sufficient vouchers for all payments made by virtue
thereof. Further, in such event the Owner hereby irrevocably authorizes and
empowers HUD to enter into and upon the said Project and take charge thereof
together with all materials and appliances thereunto belonging, and in the name of
the Owner, as attorney-in-fact, to call upon and require the several Contractors for
work to be done and for materials to be furnished in and about the completion of
said improvements to proceed to complete the said improvements in accordance
with Exhibit A, and to do whatsoever in HUD' s judgment shall be necessary to be
done to secure the completion of the said improvements. HUD shall in no event be
responsible for the completion of the said work beyond the expenditure of the sum
herewith deposited and if said sum is insufficient for such purpose the Secretary
Rehab Escrow Agreement 09-1 S-04 M2M
Page 6
shall be under no obligation to proceed further or to demand or obtain additional
sums from the Owner. This power of attorney is granted with full power of
substitution and the Owner hereby specifically agrees that all powers granted to
HUD hereunder may be assigned by it to HUD or to the Lender.
E. Remedies Cumulative and Concurrent. The rights and remedies ofHUD and
the Lender as provided in this Agreement shall be cumulative and concurrent with
any other right or remedy that HUD Secretary and the Lender may have under this
Agreement or otherwise, and may be pursued separately, successively or together
against the Owner at the sole discretion ofHUD and the Lender, and may be
exercised as often as occasion therefor shall arise. The failure to exercise any such
right or remedy shall in no event be construed as a waiver or release thereof.
12. Obligations and Liability of Lender. The Lender shall not be required to take any action
hereunder without compensation or indemnity provided with respect to such action. The
Lender shall be entitled to request the advice of BUD with respect to any matter or issue
arising hereunder concerning which the Lender is required to make [mal determination and
Lender shall not be required to take any action hereunder before receiving such advice in
writing. The Lender shall be entitled to rely on the authenticity, truth and accuracy of all
documents transmitted to it in connection with the performance of its duties hereunder and
shall not be required to undertake any independent due diligence to determine such
authenticity, truth or accuracy. The Lender shall have no liability for the performance of its
duties hereunder except with regard to its own negligence or default. HUD may require the
Lender to give a periodic accounting of the escrow deposits, withdrawals, expenses and
interest.
13. Instructions From HUD Final. In the event of any dispute regarding the terms of the
Agreement, the Lender shall be entitled to rely upon any written instructions provided by
HUD notwithstanding receipt of contradictory instructions from any other party.
14. Amendment. This Agreement may not be modified except by an instrument in writing
executed by each of the parties hereto.
15. Controlling Provisions. This Agreement shall be governed by all applicable federal laws,
the laws of the state in which the Project is located, and all applicable regulations. In the
event of a conflict between the terms and conditions of this Agreement and applicable
law or regulations, the applicable law or regulations shall control.
16. Severability. Notwithstanding anything herein contained, if any one or more of the
provisions of this Agreement shall for any reason whatsoever be held to be illegal, invalid
or unenforceable in any respect, such illegality, invalidity or unenforceability shall not affect
any other provision of this Agreement, but this Agreement shall be construed as if such
illegal, invalid or unenforceable provision had never been contained herein.
17. Counterparts. This Agreement may be executed in any number of counterparts, all of
Rehab Escrow Agreement 09-15-04 M2M
Page 7
which counterparts shall be construed together, shall be deemed originals and shall
constitute but one agreement.
18. Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of
the successors and permitted assigns of the parties.
IN WITNESS WHEREOF, the parties hereto have caused this Escrow Deposit
Agreement to be executed and made effective as of the date first above written.
[SIGNATURES ON FOLLOWING PAGE]
Signed, sealed and delivered
in the presence of:
OWNER:
AUGUSTA PROPERTIES, L.P.
a Georgia limited partnership
~~JIf
Witness
By: MEDALLION-AP, LTD.
an Ohio limited liability company
its general p er
By:
Signed, sealed and delivered
in the presence of:
LENDER:
RED MORTGAGE CAPITAL, INC.
an Ohio corporation
Witness
By: J ^ J'rrrJ1\
N!m":{ ~1Yt;~':yt ~
Title: ~f~ {J.vtR.'dv7
Rehab Escrow Agreement 09-15-04 M2M
Page 8
EXlDBIT A
DISBURSEMENT SCHEDULE
Baker Street Oosing Budget and Rehab Escrow Payout (FINAL) 07/11/08
Payable To:
Closing Related: $ 57,000.00
Relocation Costs for Residents Augusta Properties, Ltd $ 3,250.00
Attorney Fees (Brian Bush) Bush law Firm $ 11,000.00
Travel Reimbursement (Augusta Properties) Augusta Properties, Ltd $ 1,278.28
Appraiser (Hollingsworth 1) Hollingsworth 1 $ 3,000.00
Environmental Fee (Reimburse Bush law) Bush law Firm $ 1,950.00
ACE5 Environmental Lead/Asbestos rept ACES $ 5,250.00
Vacancy Loss Escrow 4 mo RED CAP Escrow $ 24,500.00
Owner's Title Ins for Baker Bush LF & Ticor Title Ins $ 2,050.00
Pro-rated taxes for Greene Augusta - Richmond Co $ 2,199.22
Recording and Mise Closing Costs Bush law Firm $ 2,522.50
$ 57,000.00 57000
Renovation Costs $ 430,000.00
Red Cap Mortgage Costs Legal/Inspection RED Cap Escrow $ 29,100.00 29100
General Provisions:
Architectural AppleGraph Contruction $ 5,000.00
Attorney Fees Bush law Firm $2,500.00
Permits AppleGraph Contruction $ 2,500.00
General labor Costs AppleGraph Contruction $15,600.00
Medallion AP, LTD oversight Medallion AP, LTD $ 32,460.46
Utility Costs AppleGraph Contruction $ 250.00
Demolition/Clean up Fees/Dumpster AppleGraph Contruction $ 7,500.00
Contingency for Demo AppleGraph Contruction $ 5,000.00
Handicap Ramps AppleGraph Contruction $ 2,500.00
5ignage for Handi Cap AppleGraph Contruction $ 150.00
Contractor Supervision Cost AppleGraph Contruction $ 19,200.00
General Conditions AppleGraph Contruction $ 4,000.00 $ 96,660.46
Concrete AppleGraph Contruction $ 2,647.80
Stair Repair/Relacement AppleGraph Contruction $ 16,906.00
Treated Wood/Carpentry/Cabinets AppleGraph Contructlon $ 9,225.43
Roofing Contingency Corner Building AppleGraph Contruction $12,000.00
Roofing/5offit/Coping/Decking/R30 AppleGraph Contruction $ 10,853.98
Door/Windows AppleGraph Contruction $ 44,061.39
Walls/Ceilings/Carpeting/Base/Painting AppleGraph Contruction $ 65,975.13
Refrigerators/Ranges/Hoods AppleGraph Contruction $11,394.00
Bathroom Accessories AppleGraph Contruction $ 1,203.75
Fire Ellt. AppleGraph Contruction $ 48150
5inks/Hotwater heaters AppleGraph Contruction $ 14,445.00
HVAC AppleGraph Contruction $ 34,668.00
Electrical/Filltures/Wiring/Security AppleGraph Contruction $ 46,400.00
Contractor Bonus for 90 Day Delivery AppleGraph Contruction $ 7,000.00
Contractor Fees AppleGraph Contruction $ 26,977.56 $ 304,239.54
$ 430,000.00 $ 430,000.00
$ 487,000.00 $ 487,000.00
Total from City of Augusta $487,000.00 $
Rehab Escrow Agreement 09-15-04 M2M Page 9
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OPERATING DEFICIT ESCROW AGREEMENT
TIllS OPERATING DEFICIT ESCROW AGREEMENT (the "Agreement") is made
and entered into the _ day of ,2008 by and between AUGUSTA
PROPERTIES, L.P., a Georgia limited partnership (the "Owner"), and RED MORTGAGE
CAPITAL, INC., an Ohio corporation (the "Escrow Agent").
RECITALS:
A. The Owner owns a certain rental housing project located in the City of Augusta, Georgia
known as August Apartments, which is further identified among the records of the
Department of Housing and Urban Development ("HUD"), as FHA Project No. 061-
35543 (the "Project").
B. The Escrow Agent is also the holder of a HUD insured loan that is secured by a Security
Deed on the Project (the "Mortgage").
C. The Escrow Agent, with HUD's consent, is releasing a building from the lien of the
Mortgage (the "Green Street Property").
D. The Owner intends to substitute another building at another location (the "Baker Avenue
Property") for the Green Street Property, as collateral secured by the Mortgage.
E. The Baker Avenue Property will have to be repaired and rehabilitated before it is income
producing.
F. The Owner anticipates the repairs and rehabilitation to take place approximately three (3)
months to complete.
G. In order to induce the Escrow Agent and HUD to consent to the substitution of the Baker
Avenue Property (a temporarily non-income producing building) for the Green Street
Property (a currently income producing property), the Owner has deposited into an
Operating Deficit escrow the amount of $ 24,500.00 (the "Deposit") with the Escrow
Agent to be held and administered pursuant to the terms of this Agreement.
NOW, THEREFORE, for and in consideration of the foregoing premises and other good and
valuable considerations, the receipt and sufficiency of which are hereby acknowledged, the
Owner and Escrow Agent agrees as follows.
1. The Owner has funded the Deposit with the Escrow Agent who acknowledges
its receipt.
2. The Escrow Agent shall hold the Deposit in an interest bearing account, with all
interest thereon being included with the Deposit, which interest shall constitute
Operating Escrow Agreement Page 1
/-
taxable income to the Owner.
3. Said Deposit shall be held for a period of four (4) months from the date hereof,
for the purpose of paying, on a monthly basis, any rental income (inclusive of
Section 8 Housing Assistance Payments) short falls or cash deficit at the
completion of repairs. In determining the amount of such cash deficit, effects
will be given to the Owner's payments for amortization and deposits in the
Reserve for Replacements, but no effect will be given to depreciation, officers'
salaries, and management fees paid to the Owner or sponsors of the project or
their nominees. Disbursements shall be made at such times and in such amounts
as shall be approved by HUD.
4. The Deposit will be subject to the immediate application to the Mortgage debt
in the event of default under the Mortgage at any time prior to the expiration of
the escrow period.
5. It is understood and agreed that at the expiration of the escrow period, or at such
earlier date as the Secretary determines that the project has achieved sustaining
occupancy and income, any balance remaining on deposit will be returned to the
to the Project's Reserve for Replacements Fund being administered by the
Escrow Agent in its capacity as servicer of the Mortgage.
6. Whenever used herein, the singular number shall include the plural, the plural
the singular, and any use of any gender, shall be applicable to all genders.
7. This Agreement may be executed in counterpart, each one of which shall be
deemed an original.
IN WITNESS WHEREOF, the parties hereto have caused this Operating Deficit Escrow
Agreement to be executed and made effective as of the date first above written.
OWNER:
AUGUSTA PROPERTIES, L.P.
a Georgia limited partnership
By: MEDALLION-AP, LTD.
an Ohio limited liability company
its gener artner
By:
[CONTINUED ON FOLLOWING PAGE]
Operating Escrow Agreement Page 2
. .
ESCROW AGENT:
RED MORTGAGE CAPITAL, INC.
an Ohio corporation
By:
Operating Escrow Agreement Page 3