Exhibit 10.1

 

 

 

SINGLE FAMILY HOMES

 

REAL ESTATE PURCHASE AND SALE AGREEMENT

 

by and between

 

WRI CAPITAL GROUP II LLC,

a Georgia limited liability company,

as Seller

and

 

REVEN ACQUISITIONS, LLC,
a Delaware limited liability company,
as Buyer

 

July 30, 2012

 

 

 

 

 

THIS SINGLE FAMILY HOMES PURCHASE AND SALE AGREEMENT (this “Agreement”) is made
and entered into as of July 30, 2012 (“Effective Date”), by and between WRI
Capital Group II LLC, a Georgia limited liability company (“Seller”) and Reven
Acquisitions, LLC, a Delaware limited liability company (together with any
designee identified or appointed by Reven Acquisitions, LLC, “Buyer”).

 

BASIC TERMS

 

The following terms, as used in this Agreement, will have the meanings assigned
to such terms in this Basic Terms section of the Agreement, subject to any
adjustments set forth elsewhere in this Agreement.

 

Purchase Price: $695,500.00 subject to adjustment in accordance with the
provisions of this Agreement.

 

Deposit: $20,000.00.

 

Closing Date: Thirty days after expiration of the Approval Period.

 

Due Diligence Period: Subject to the provisions of Section 7 below, the period
commencing on the Effective Date and ending on the later to occur of (i) the
date that is 30 days after the Effective Date, and (ii) the date that is 5
business days following the date on which Buyer has received a fully executed
Lease (as defined herein) applicable to each of the 10 houses that comprise the
Property (as defined herein), during which period Buyer will be provided the
opportunity to review all aspects of the Property.

 

Escrow Holder: Feldman Law Offices, LLC.

 

Title Company: Fidelity National Title Insurance Company.

 

 

 

PRELIMINARY STATEMENTS

 

A. Seller is the owner of the Property; and

 

B. Seller desires to sell, and Buyer desires to buy, the Property, at the price
and on the terms and conditions hereafter set forth.

 

In consideration of the recitals, mutual covenants, and agreements set forth
herein, and for other good and valuable consideration, the receipt and
sufficiency of which are mutually acknowledged, Seller and Buyer hereby agree as
follows:

 

1. Premises. The real estate which is the subject of this Agreement consists of
10 single family homes, in the State of Georgia, which are identified and
generally described on Exhibit A attached hereto, together with all of the
improvements and structures located thereon (“Improvements”), any heating and
ventilating systems and other fixtures located therein or thereon, and all
rights, interests, benefits, privileges, easements and appurtenances to the land
and the Improvements, if any (collectively, the “Premises”).

 

 

 

 

 

2. Personal Property and Leases.

 

(a) The “Personal Property” referred to herein shall consist of all right,
title, and interest of Seller, if any, in all tangible (including all
advertising materials, plans and specifications) and intangible personal
property, including any equipment, appliances, or furnishings that remain in the
Premises at the Closing, and any and all existing licenses and permits held by
Seller and not constituting part of the real estate, located on and used in
connection with the Premises.

 

(b) The “Leases” referred to herein shall consist of the leases, occupancy and
rental agreements between the Seller, as landlord and tenants of the single
family homes that comprise the Premises that are in effect as of the date of the
Closing (defined below), as well as and service contracts relating to the
maintenance and repair of such homes.

 

3. Sale/Conveyance and Assignment. Seller agrees to sell, convey and assign to
Buyer, and Buyer agrees to buy and assume from Seller, at the price and upon the
other terms and conditions hereafter set forth (a) the Premises, (b) the
Personal Property, (c) the Improvements, and (d) the Leases (a-d collectively,
the “Property”).

 

4. Transfer of Title.

 

(a) Title to the Property shall be conveyed to Buyer by a Limited Warranty Deed,
in the form customary in the State of Georgia (the “Deed”), executed by Seller,
in the form attached hereto as Exhibit C.

 

(b) The Personal Property shall be conveyed to Buyer by a bill of sale (the
“Bill of Sale”) executed by Seller, in the form attached hereto as Exhibit D.

 

(c) The Leases shall be assigned by Seller and assumed by Buyer by an Assignment
Leases and Contracts (the “Assignment of Leases and Contracts”), in the form
attached hereto as Exhibit E.

 

5. Purchase Price; Deposit.

 

(a) Delivery of Purchase Price. The purchase price for the Property shall be the
price identified in the Basic Terms (the “Purchase Price”), which shall be
subject to reduction in accordance with Section 7(d) and payable by Buyer to
Seller as follows:

 

(1) Within two (2) business days after the execution of this Agreement, Buyer
shall deposit into an escrow account (the “Escrow”) established with Escrow
Holder (as identified in the Basic Terms), which will serve as escrow holder for
this transaction a deposit in the amount of the Deposit (as identified in the
Basic Terms above). If Buyer notifies Seller that it elects to proceed to
purchase the Property in accordance with the provisions of Section 7, then the
Deposit (as defined in the Basic Terms) will become non-refundable to Buyer,
except in the event of a default or breach of this Agreement by Seller. The
Deposit shall at all times prior to Closing be invested in United States
treasury obligations or such other interest bearing accounts or securities as
are approved by Buyer in writing; all interest earned on the Deposit will be
administered, paid or credited (as the case may be) in the same manner as the
Deposit and, when credited to the escrow account shall constitute additional
Deposit. At the closing of the transactions contemplated by this Agreement (the
“Closing”), Buyer shall receive a credit against the Purchase Price for the
Deposit.

 

2

 

 

 

(2) The Purchase Price, less a credit for the Deposit, and plus or minus
prorations and adjustments as set forth in Section 17 hereof, shall be paid by
Buyer to Seller by wire transfer of immediately available federal funds on the
Closing Date.

 

(b) Appraised Value. Buyer may elect to retain an independent, third-party
appraiser to prepare a valuation report or appraisal (“Appraisal”) of the
Property. Any person preparing the Appraisal on behalf of Buyer must be a
licensed appraiser in the jurisdiction where the Property is located with at
least five years’ experience appraising single family homes of the type and
nature of the properties that comprise the Property. Upon request, Buyer shall
provide Seller with copies of any Appraisals of the Property. If the sum of the
appraised values of the properties that comprise the Property (“Total Appraised
Value”) is less than the Purchase Price, then within three (3) business days
after receipt of the Appraisals, Buyer shall provide written notification to
Seller that Buyer intends to reduce the Purchase Price by the amount that the
Purchase Price exceeds the Total Appraised Value; provided that Buyer has no
right to a Purchase Price reduction in excess of five percent (5%) of the
original Purchase Price without Seller’s written agreement. If the Purchase
Price exceeds the Total Appraised Value by more than 5% of the Purchase Price,
and Seller does not agree to reduce the Purchase Price to the Total Appraised
Value, then Buyer may, upon written notice to Seller at least ten business days
before the then-scheduled Closing Date, elect to (i) close the transaction as
contemplated with a 5% reduction of the Purchase Price or (ii) terminate this
Agreement. If Buyer terminates this Agreement in accordance with this Section
5(b), then this Agreement will have no further force or effect, the parties will
have no further obligations to each other (except for any indemnities or other
provisions that expressly survive termination of this Agreement) and Escrow
Holder shall refund the Deposit to Buyer.

 

(c) Notwithstanding Section 5(b) above and Section 7(d) below, Buyer may, in
lieu of adjusting the Purchase Price as a result of necessary repairs and
replacements or a Total Appraised Value that is less than the Purchase Price in
accordance with those provisions, elect to exclude specified properties from the
properties identified on Exhibit A. If, as a result of its due diligence
investigations, Buyer elects to exclude one or more properties from the Property
being acquired in accordance with this Agreement, then at least ten business
days before the Closing Date, Buyer will notify Seller that certain specified
properties (“Excluded Properties”) are to be excluded from the sale contemplated
in this Agreement. Seller shall have two business days to accept Buyer’s
Excluded Properties. Following Buyer’s notification to Seller, Buyer’s
identification of the Excluded Properties and Seller’s acceptance of the
Excluded Properties, (i) the description of the properties that comprise the
Property, as identified on Exhibit A, will be deemed modified to exclude the
Excluded Properties; and (ii) the Purchase Price will be reduced by an amount
equal to the aggregate total of the prices set forth for the Excluded Properties
as identified on Exhibit A. Once Buyer identifies to Seller the Excluded
Properties, those properties so identified will no longer be the subject of this
Agreement and Seller will be free to sell them to another party or take any
action that Seller elects with respect to the Excluded Properties.

 

3

 

 

6. Representations, Warranties and Covenants.

 

(a) Seller’s Representations and Warranties. As a material inducement to Buyer
to execute this Agreement and consummate this transaction, Seller represents and
warrants to Buyer as follows:

 

(1) Organization and Authority. Seller has been duly organized and is validly
existing as a limited liability company. Seller has the full right and authority
and has obtained any and all consents required therefor to enter into this
Agreement, consummate or cause to be consummated the sale and make or cause to
be made transfers and assignments contemplated herein. The persons signing this
Agreement on behalf of Seller are authorized to do so. This Agreement and all of
the documents to be delivered by Seller at the Closing have been authorized and
properly executed and will constitute the valid and binding obligations of
Seller, enforceable against Seller in accordance with their terms.

 

(2) Conflicts. There is no agreement to which Seller is a party or, to Seller’s
Knowledge, binding on Seller or the Property, that is in conflict with this
Agreement or that would limit or restrict the timely performance by Seller of
its obligations pursuant to this Agreement.

 

(3) Documents and Records. To Seller’s Knowledge, Seller has provided (or upon
the execution hereof will provide) Buyer with, or has made available to Buyer,
true, correct and complete copies of the items scheduled in Schedule 6(a)(3)
attached hereto (all of the foregoing collectively the “Property Information”).
The Property Information consists of all documents relating to the Property in
Seller’s possession or control.

 

(4) Litigation. There is no action, suit or proceeding pending or to Seller’s
knowledge threatened which (i) if adversely determined, would not be covered by
insurance (subject to the payment of a customary insurance deductible) or
adversely affect the Property, or (ii) which challenges or impairs Seller’s
ability to execute, deliver or perform this Agreement or consummate the
transaction contemplated hereby.

 

(5) Leases. Schedule 6(a)(5) sets forth a list of the leases and all contracts
(including all service, maintenance, and warranty contracts) that apply to the
properties that comprise the Property, which, to Seller’s Knowledge, is true and
correct and complete list of such leases and contracts as of the date of such
schedule. To Seller’s Knowledge, except as scheduled in Schedule 6(a)(5),
neither Seller nor any other party is in default with respect to any of its
obligations or liabilities pertaining to the Leases. To Seller’s Knowledge,
other than the Leases and any other matters disclosed in the Title Report, there
are no leases, licenses or other occupancy agreements to which Seller is a party
or is bound affecting any portion of the Property as of the date hereof, which
will be in force on the Closing Date. Seller has delivered or made available at
the Property, true and correct copies of the Leases to Buyer.

 

4

 

 

(6) Contracts. Exhibit B sets forth all contracts presently outstanding with
respect to the Property. To Seller’s Knowledge, neither Seller nor any other
party is in default with respect to any of its obligations or liabilities
pertaining to any contracts that will survive the Close of Escrow.

 

(7) Notice of Violations. Seller has received no written notice that either the
Property or the use thereof violates any laws, rules and regulations of any
federal, state, city or county government or any agency, body, or subdivision
thereof having any jurisdiction over the Property that have not been resolved to
the satisfaction of the issuer of the notice.

 

(8) Withholding Obligation. Seller is not a “foreign person” within the meaning
of Section 1445 of the Internal Revenue Code of 1986, as amended.

 

(9) Condemnation. Except for any condemnation proceedings which Seller has not
yet been served with process, there are no pending or, to Seller’s Knowledge,
threatened condemnation or similar proceedings affecting the Property or any
individual property that is a part thereof.

 

(10) Employees. Seller has no employees at the Property.

 

(11) No Bankruptcy Proceedings. Seller has not (i) made a general assignment for
the benefit of creditors, (ii) filed any voluntary petition in bankruptcy or
suffered the filing of any involuntary petition by Seller’s creditors, (iii)
suffered the appointment of a receiver to take possession of all or
substantially all of Seller’s assets, or (iv) suffered the attachment or other
judicial seizure of all or substantially all of Seller’s assets.

 

(12) Unrecorded Documents. Other than as disclosed in the Property Information,
the Title Commitment, or any other documents delivered to Buyer, Seller has not
entered into any unrecorded contracts, leases, easements or other agreements
with respect to the Property that would be binding on Buyer or the Property
following the Closing. Seller has no knowledge of any claim of any third party
affecting the use, title, occupancy or development of the Property that has not
been disclosed to Buyer. Seller has not granted any right of first refusal,
option or other right to acquire all or any part of the Property.

 

For purposes of this Section 6(a), the term “Seller’s Knowledge” means the
actual knowledge of Colin Brechbill the person who Seller represents to be the
most knowledgeable about the Property.

 

(b) Buyer’s Representations and Warranties. As a material inducement to Seller
to execute this Agreement and consummate this transaction, Buyer represents and
warrants to Seller that Buyer has been duly organized and is validly existing as
a Delaware limited liability company. Buyer has the full right and authority and
has obtained any and all consents required therefor to enter into this
Agreement, consummate or cause to be consummated the purchase, and make or cause
to be made the deliveries and undertakings contemplated herein or hereby. The
persons signing this Agreement on behalf of Buyer are authorized to do so. This
Agreement and all of the documents to be delivered by Buyer at the Closing have
been authorized and properly executed and will constitute the valid and binding
obligations of Buyer, enforceable against Buyer in accordance with their terms.

 

5

 

 

(c) Covenants of Seller. Seller covenants and agrees that during the period from
the date of this Agreement through and including the Closing Date:

 

(1) Seller will timely pay and perform its obligations under the Leases and any
contracts to be assumed by Buyer pursuant hereto.

 

(2) Following the expiration of the Due Diligence Period, Seller will not enter
into any contract (other than new Leases) that will be an obligation affecting
the Property subsequent to the Closing Date except for contracts entered into in
the ordinary course of business that are terminable without cause and without
payment of a penalty on not more than 30-days’ notice.

 

(3) Seller will not remove any Personal Property from the Property except as may
be required for necessary repair or replacement, and in the event of such
replacement, the replacement shall be of materially equal or better quality and
quantity as existed as of the time of its removal.

 

(4) Seller will continue to operate and maintain the Property in accordance with
past practices and will not make any material alterations or changes thereto;

 

(5) Seller will maintain casualty and liability insurance of a level and type
consistent with the insurance maintained by Seller prior to the execution of
this Agreement with respect to the Property;

 

(6) Seller will not do anything, or authorize anything to be done, that would
adversely affect the condition of title as shown on the Title Commitment.

 

(7) Seller agrees to terminate by written notice to the other parties thereto,
effective as of Closing, any service contracts that Buyer, pursuant to written
notice to Seller prior to the expiration of the Due Diligence Period, requests
Seller to terminate. Seller shall deliver to Buyer copies of all notices of
termination given by Seller pursuant to this subsection.

 

(8) Seller shall repair all homes that become vacant at least five (5) days
prior to the Closing to “rent-ready” condition in accordance with Seller’s
customary practice and procedure for the Property. Buyer shall receive a
$3,400.00 credit against the Purchase Price with respect to any unit that is
vacant and not in “rent ready” condition on the Closing Date. At Buyer’s
request, Seller shall inspect each of the vacant units prior to the Closing to
determine if any of such units cannot be restored to “rent ready” condition at a
cost of $3,400.00 or less, and Buyer and Seller hereby agree to make such
adjustments to the $3,400.00 per unit credit as Buyer and Seller agree, acting
reasonably, are necessary in order to pay for the cost of restoring the vacant
units to “rent ready” condition. Upon request, Seller shall keep Buyer
reasonably informed as to the status of leasing prior to the Closing Date and
shall deliver to Buyer copies of all new Leases.

6

 

 

 

(d) Representation and Warranties Prior to Closing. The continued validity in
all respects of the foregoing representations and warranties shall be a
condition precedent to the obligation of the party to whom the representation
and warranty is given to close this transaction. If any of Seller’s
representations and warranties are not true and correct at any time on or before
the Closing even if true and correct as of the date of this Agreement or whether
any change in facts or circumstances has made the applicable representation and
warranty no longer true and correct and regardless as to whether Buyer becomes
aware of such fact through Seller’s notification or otherwise, then Buyer must
give written notice to Seller of the false or incorrect representation and
warranty. Seller will thereafter have ten business days to make true or correct
the representation and warranty. If Seller does not make true or correct the
representation and warranty within ten business days, Buyer may, at Buyer’s
option, exercised by written notice to Seller (and as its sole and exclusive
remedy), either (i) proceed with this transaction, accepting the applicable
representation and warranty as being modified by such subsequent matters or
knowledge and waiving any right relating thereto, if any, or (ii) terminate this
Agreement and declare this Agreement of no further force and effect and in which
event Escrow Holder shall, without further instruction, return the Deposit to
Buyer and Seller shall have no further liability hereunder by reason thereof;
provided, that if the breach of any representation or warranty of Seller
hereunder results from the willful and intentional act of Seller, Buyer will
have the rights and remedies available to Buyer under Section 18(b) of this
Agreement upon a default by Seller of its obligations under this Agreement.

 

7. Due Diligence Period.

 

(a) Buyer may, during the Due Diligence Period (as defined in the Basic Terms),
examine, inspect, and investigate the Property and, in Buyer’s sole judgment and
discretion, to determine whether Buyer desires to purchase the Property;
provided that Buyer may, in its discretion, upon notice to Seller, waive the
requirement that a Lease be executed for each house, and cause the Due Diligence
Period to expire.

 

(b) Buyer may terminate this Agreement for any or no reason by giving written
notice of such termination to Seller on or before the last day of the Due
Diligence Period. If this Agreement is terminated pursuant to this Section 7,
the Deposit shall be immediately refunded to Buyer, and neither party shall have
any further liability or obligation to the other under this Agreement except for
the indemnity provisions set forth in Section 7(c) of this Agreement and any
other provision of this Agreement that is expressly intended to survive the
termination of this Agreement. If Buyer does not elect to exercise its right to
terminate this Agreement during the Due Diligence Period, then Buyer shall
notify Seller of Buyer’s intention to acquire the Property before the expiration
of the Due Diligence Period. If Buyer does not, before the expiration of the Due
Diligence Period, either affirmatively notify Seller of its desire to acquire
the Property or send a termination notice to Seller, then Buyer will be deemed
to have elected to proceed to Purchase the Property under this Agreement. If
Buyer elects to proceed to purchase the Property, and this Agreement is not
terminated or deemed terminated before the expiration of the Due Diligence
Period, then the Deposit shall be non-refundable except in the event of a
default hereunder by Seller.

 

7

 

 

 

(c) Subject to the rights of tenants under the Leases, Seller will provide to
Buyer reasonable access to the Property for the purpose of examining any or all
aspects thereof, including conducting on a non-destructive basis, surveys,
architectural, engineering, non-invasive geo-technical and environmental
inspections and tests, and any other inspections, studies, or tests reasonably
required by Buyer. Buyer shall give Seller reasonable notice by telephone or
e-mail before entering onto any of the properties that comprise the Property to
perform inspections or tests, and in the case of tests (i) Buyer shall specify
to Seller the precise nature of the test to be performed, and (ii) Seller may
require, as a condition precedent to Buyer’s right to perform any such test,
that Buyer deliver Seller evidence of public liability and other appropriate
insurance naming Seller as an additional insured thereunder. Such examination of
the physical condition of the Property, including the Third Party Inspection
Report (defined in Section 7(d) below) may include an examination for the
presence or absence of hazardous or toxic materials, substances or wastes, which
shall be performed or arranged by Buyer at Buyer’s sole expense. Buyer shall
keep the Property free and clear of any liens and will indemnify, protect,
defend, and hold each Seller Related Party (defined below) harmless from and
against all losses, costs, damages, claims, liabilities and expenses (including
reasonable attorneys’ fees and court costs) (collectively, “Losses”) arising
from damage to the Property and injury to persons asserted against or incurred
by any Seller Related Party as a result of such entry by Buyer, its agents,
employees or representatives (except that Buyer shall have no liability or
indemnity obligation for any diminution in the value of the Property as a result
of any unfavorable analysis, test, study, opinion or recommendation made to or
for or reach by Buyer). If any inspection or test disturbs the Property and
Buyer does not acquire the Property, Buyer will restore the Property to
substantially the same condition as existed prior to any such inspection or
test. Buyer and its agents, employees, and representatives may, upon not less
than 24 hours prior telephonic notice to Seller, examine and make copies of all
books and records and other materials relating to the condition of the Property
in Seller’s possession at the office where such records are maintained. Any
information provided to or obtained by Buyer with respect to the Property shall
be subject to the provisions of Section 22(p) of this Agreement. The obligations
of Buyer under this Section shall survive the termination of the Agreement.

 

(d) Buyer may retain a contractor or home inspector to prepare a report or
reports describing the physical condition of the Property and identify any
necessary repairs or improvements (“Third Party Inspection Report”). The person
or entity preparing the Third Party Inspection Report must be licensed to
perform such inspections in the jurisdiction where the Property is located, and
may not be, or have ever been, owned or controlled by Buyer or an affiliate of
Buyer. Buyer will provide a copy of the Third Party Inspection Report to Seller,
and within three business days after receiving the Third Party Inspection
Report, Buyer shall provide Seller written notification of its intent to reduce
the Purchase Price by the amount of the total estimated cost of the repairs or
replacements identified in the Third Party Inspection Report; provided that
Buyer will have no right to a Purchase Price reduction in excess of five percent
(5%) of the original Purchase Price without Seller’s written agreement. If the
cost to make the repairs and replacements identified in the Third Party
Inspection Report exceeds 5% of the Purchase Price, and Seller does not agree to
reduce the Purchase Price by the identified cost of such repairs and
replacements, then Buyer may, upon written notice to Seller within 5 days after
notice from Seller that Seller does not agree to such reduction, elect to (i)
close the transaction as contemplated with a 5% reduction of the Purchase Price
or (ii) terminate this Agreement. If Buyer terminates this Agreement in
accordance with this Section 7(d), then this Agreement will have no further
force or effect, the parties will have no further obligations to each other
(except for any indemnities or other provisions that expressly survive
termination of this Agreement) and Escrow Holder shall refund the Deposit to
Buyer.

 

8

 

 

 

8. As Is Sale.

 

(a) BUYER SPECIFICALLY ACKNOWLEDGES AND AGREES THAT SELLER IS SELLING AND BUYER
IS PURCHASING THE PROPERTY ON AN “AS IS WITH ALL FAULTS” BASIS AND THAT, EXCEPT
AS EXPRESSLY SET FORTH IN THIS AGREEMENT AND THE CLOSING DOCUMENTS DELIVERED BY
SELLER TO BUYER AT CLOSING, BUYER IS NOT RELYING ON ANY REPRESENTATIONS OR
WARRANTIES OF ANY KIND WHATSOEVER, EXPRESS OR IMPLIED, FROM SELLER, ITS AGENTS,
OR BROKERS AS TO ANY MATTERS CONCERNING THE PROPERTY, INCLUDING WITHOUT
LIMITATION: (I) THE QUALITY, NATURE, ADEQUACY AND PHYSICAL CONDITION OF THE
PROPERTY, INCLUDING, BUT NOT LIMITED TO THE STRUCTURAL ELEMENTS, FOUNDATION,
ROOF, APPURTENANCES, ACCESS, LANDSCAPING, PARKING FACILITIES AND THE ELECTRICAL,
MECHANICAL, HVAC, PLUMBING, SEWAGE, AND UTILITY SYSTEMS, FACILITIES AND
APPLIANCES, (II) THE QUALITY, NATURE, ADEQUACY, AND PHYSICAL CONDITION OF SOILS,
GEOLOGY AND ANY GROUNDWATER, (III) THE EXISTENCE, QUALITY, NATURE, ADEQUACY AND
PHYSICAL CONDITION OF UTILITIES SERVING THE PROPERTY, (IV) THE DEVELOPMENT
POTENTIAL OF THE PROPERTY, AND THE PROPERTY’ USE, HABITABILITY, MERCHANTABILITY,
OR FITNESS, SUITABILITY, VALUE OR ADEQUACY OF THE PROPERTY FOR ANY PARTICULAR
PURPOSE, (V) THE ZONING OR OTHER LEGAL STATUS OF THE PROPERTY OR ANY OTHER
PUBLIC OR PRIVATE RESTRICTIONS ON USE OF THE PROPERTY, (VI) THE COMPLIANCE OF
THE PROPERTY OR ITS OPERATION WITH ANY APPLICABLE CODES, LAWS, REGULATIONS,
STATUTES, ORDINANCES, COVENANTS, CONDITIONS AND RESTRICTIONS OF ANY GOVERNMENTAL
OR QUASI-GOVERNMENTAL ENTITY OR OF ANY OTHER PERSON OR ENTITY, (VII) THE
PRESENCE OR ABSENCE OF HAZARDOUS MATERIALS (AS DEFINED IN ANY ENVIRONMENTAL
STATUTE) ON, UNDER OR ABOUT THE PROPERTY OR THE ADJOINING OR NEIGHBORING
PROPERTY, (VIII) THE QUALITY OF ANY LABOR AND MATERIALS USED IN ANY IMPROVEMENTS
ON THE PROPERTY, (IX) THE CONDITION OF TITLE TO THE PROPERTY, (X) THE LEASES
(INCLUDING ALL SERVICE CONTRACTS) AND ANY OTHER AGREEMENTS AFFECTING THE
PROPERTY AND (XI) THE ECONOMICS OF ANY PAST OR FUTURE OPERATIONS OF THE
PROPERTY.

 

9. Survival of Representations and Warranties After Closing.

 

(a) All representations and warranties of Seller herein shall survive the
Closing for a period of one hundred twenty (120) days (the “Limitation Period”).

 

9

 

 

(b) Buyer shall provide actual written notice to Seller of any breach of any of
Seller’s warranties or representations of which Buyer acquires knowledge,
through any means, at any time after the Closing Date but prior to the
expiration of the Limitation Period, and shall allow Seller thirty (30) days
within which to cure such breach, or, if such breach is susceptible of cure but
cannot reasonably be cured within thirty (30) days, an additional reasonable
time period required to effect such cure so long as such cure has been commenced
within such thirty (30) days and diligently pursued but in no event more than
ninety (90) days. If Seller fails to cure such breach after actual written
notice and within such cure period (as extended), Buyer’s sole remedy shall be
an action at law for damages as a consequence thereof, which must be commenced,
if at all, within the six (6) months after the expiration of the Limitation
Period.

 

10. Closing.

 

(a) The purchase and sale transaction contemplated in this Agreement shall occur
on the date specified in the Basic Terms section of this Agreement (the “Closing
Date”), and accomplished by recording the Deed (as defined in Section 14) in the
Official Records of the particular County in which each of the individual
properties that constitute the Property is located (the “Official Records”),
provided that all conditions precedent to the Closing have been fulfilled or
have been waived in writing by the respective party entitled to waive same.

 

(b) On or before the Closing Date, the parties shall establish the usual form of
deed and money escrow with Escrow Holder. Counsel for the respective parties are
hereby authorized to execute the escrow trust instructions as well as any
amendments thereto.

 

11. Conditions to Buyer’s Obligation to Close.

 

(a) Buyer will not be obligated to proceed with the Closing unless and until
each of the following conditions has been either fulfilled or waived in writing
by Buyer:

 

(1) This Agreement shall not have been previously terminated pursuant to any
other provision hereof;

 

(2) Seller shall be prepared to deliver or cause to be delivered to Buyer all
instruments and documents to be delivered to Buyer at the Closing pursuant to
Section 14 and Section 16 or any other provision of this Agreement; and

 

(3) All property managing services provided to the Property under any property
management agreement shall have been terminated on or prior to the Closing at no
cost, liability or expense to Buyer.

 

(b) If any of the foregoing conditions are not fulfilled on or before the time
for Closing hereunder, then subject to the provisions of Section 18(b) hereof,
Buyer may elect, upon notice to Seller, to terminate this Agreement, in which
event the Deposit shall be returned to Buyer, and neither party shall have any
further liability or obligation to the other, except for the provisions of this
Agreement which are expressly stated to survive the termination of this
Agreement.

 

10

 

 

 

12. Conditions to Seller’s Obligation to Close.

 

(a) Seller will not be obligated to proceed with the Closing unless and until
each of the following conditions has been fulfilled or waived in writing by
Seller:

 

(1) Buyer shall be prepared to pay to Seller the Purchase Price and all other
amounts to be paid to it at Closing pursuant to the provisions of this
Agreement;

 

(2) Buyer shall be prepared to deliver to Seller all instruments and documents
to be delivered to Seller at the Closing pursuant to Section 15 and Section 16
or any other provision of this Agreement; and

 

(3) This Agreement shall not have been previously terminated pursuant to any
other provision hereof.

 

(b) If the foregoing conditions are not fulfilled on or before the time for
Closing hereunder, then subject to the provisions of Section 18(a) hereof,
Seller may elect, upon notice to Buyer, to terminate this Agreement, in which
event the Deposit shall be returned to Buyer, and neither party shall have any
further liability or obligation to the other, except for the provisions of this
Agreement which are expressly stated to survive the termination of this
Agreement.

 

13. Title Insurance. (a) Concurrently with the execution and delivery of this
Agreement, Buyer shall obtain (or Seller shall cause the Escrow Holder to
deliver to Buyer) (i) a commitment for the Title Policy described in subsection
(b) below (the “Title Commitment”), together with legible copies of all of the
underlying documentation described in such Title Commitment, and (ii) any
surveys of the properties that comprise the Property in Seller’s possession or
control (collectively, the “Survey”).

 

(a) As a condition to closing, Buyer shall receive an owner’s title insurance
policy (the “Title Policy”) issued by Title Company, dated the day of Closing,
with liability in the full amount of the Purchase Price, the form of which shall
be an American Land Title Association Owner’s Policy, Standard Form B, 1992 (or
other form preferred by Buyer or required or promulgated pursuant to applicable
state insurance regulations), subject only to the Permitted Exceptions (defined
below). The Title Policy may contain any endorsements requested by Buyer.

 

(b) Prior to the expiration of the Due Diligence Period, Buyer shall review
title to the Property as disclosed by the Title Commitment and the Survey, and
satisfy itself as to the availability from the Title Company of the Title Policy
and all requested endorsement to such Title Policy. Buyer shall have the right
to obtain an update of the Survey or a new survey at any time prior to the
expiration of the Due Diligence Period.

 

(c) Seller shall have no obligation to remove or cure title objections, except
for (1) liens of an ascertainable amount created by Seller, which liens Seller
shall cause to be released at the Closing or affirmatively insured over by the
Title Company with Buyer’s approval, (2) any exceptions or encumbrances to title
which are created by Seller after the date of this Agreement without Buyer’s
consent, and (3) non-consensual liens which liens Seller shall cause to be
released at the Closing or affirmatively insured over by the Title Company. In
addition, Seller shall provide the Title Company with any affidavits, ALTA
statements or personal undertakings (collectively, an “Owner’s Affidavit”), in
form and substance reasonably acceptable to the Title Company, that will permit
the Title Company to remove the standard “mechanics lien” and “GAP” exceptions
and otherwise issue the Title Policy in the form required by Buyer.

 

11

 

 

 

(d) “Permitted Exceptions” shall mean: (1) any exception arising out of an act
of Buyer or its representatives, agents, employees or independent contractors;
(2) zoning and subdivision ordinances and regulations; (3) the specific
exceptions in the Title Commitment that the Title Company has not agreed to
insure over or remove from the Title Commitment as of the end of the Due
Diligence Period and that Seller is not required to remove as provided above;
(4) items shown on the Surveys or any updated or new surveys of the Property
which have not been removed as of the end of the Due Diligence Period; (5) real
estate taxes and assessments not yet due and payable; and (6) rights of tenants
under the Leases, as occupancy tenants only and without any rights of first
refusal, rights of first offer or purchase options.

 

14. Documents to be Delivered to Buyer at Closing. At Closing, Seller shall
deliver or cause to be delivered to Buyer each of the following instruments and
documents:

 

(a) Deed. The Deed, in the form attached hereto as Exhibit C.

 

(b) Bill of Sale. The Bill of Sale covering the Personal Property, in the form
attached hereto as Exhibit D.

 

(c) The Title Policy. The Title Policy may be delivered after the Closing if at
the Closing the Title Company issues a currently effective, duly-executed
“marked-up” Title Commitment and irrevocably commits in writing to issue the
Title Policy in the form of the “marked-up” Title Commitment after the Closing.

 

(d) Assignment of Leases and Contracts. An Assignment of Leases and Contracts,
in the form attached hereto as Exhibit E, transferring and assigning to Buyer,
to the extent the same are assignable, all right, title and interest of Seller
in the Leases and the other property described therein.

 

(e) Transfer Tax Declarations. Original copies of any required real estate
transfer tax or documentary stamp tax declarations executed by Seller or any
other similar documentation required to evidence the payment of any tax imposed
by the state, county and city on the transaction contemplated hereby.

 

(f) FIRPTA. An affidavit, in the form attached hereto as Exhibit F, stating
Seller’s U.S. taxpayer identification number and that Seller is a “United States
person”, as defined by Internal Revenue Code Section 1445(f)(3) and Section
7701(b).

 

(g) Owner’s Affidavit. The Owner’s Affidavit materials referred to in Section
13(d) above.

 

12

 

 

 

(h) Surveys, Plans, Permits and Specifications. All existing surveys,
blueprints, drawings, plans and specifications, permits, and operating manuals
for or with respect to any of the properties that comprise the Property or any
part thereof to the extent the same are in Seller’s possession.

 

(i) Keys. All keys to the improvements, to the extent the same are in Seller’s
possession.

 

(j) Leases. Originals of all Leases in effect on the Closing Date (or copies
thereof in the event the originals are not in Seller’s possession, or in the
possession of Sellers’ property manager and such copies of Leases are in
Seller’s possession), and the tenant files with respect to such Leases, to the
extent the same are in Seller’s possession.

 

(k) Certificate. A certificate (the “Update”) of Seller dated as of the Closing
Date certifying that the representations and warranties of Seller set forth in
Section 6(a) of this Agreement as applicable, remain true and correct in all
material respects as of the Closing Date, except as to Schedule 6(a)(5), which
Update shall be dated no earlier than three (3) days prior to Closing.

 

(l) Other Deliveries. Such other documents and instruments as may be required by
any other provision of this Agreement or as may reasonably be required to carry
out the terms and intent of this Agreement.

 

15. Documents to be Delivered to Seller at Closing. At Closing, Buyer shall
deliver or cause to be delivered to Seller each of the following instruments,
documents and amounts:

 

(a) Purchase Price. The Purchase Price, subject to adjustment and proration as
provided in Section 17 below.

 

(b) Transfer Tax Declarations. Original copies of any required real estate
transfer tax or documentary stamp tax declarations executed by Buyer or any
other similar documentation required to evidence the payment of any tax imposed
by the state, county and city on the transaction contemplated hereby.

 

(c) Assignment of Leases. A counterpart of the Assignment of Leases and
Contracts, in the form attached hereto as Exhibit E.

 

(d) Certificate. A certificate of Buyer (the “Buyer’s Update”) dated as of the
Closing Date certifying that the representations and warranties of Buyer set
forth in Section 6(b) of this Agreement as applicable, remain true and correct
in all material respects as of the Closing Date, which Buyer’s Update shall be
dated no earlier than three (3) days prior to Closing.

 

(e) Other Documents. Such other documents and instruments as may be required by
any other provision of this Agreement or as may reasonably be required to carry
out the terms and intent of this Agreement.

 

13

 

 

 

16. Documents to be Delivered by Seller and Buyer at Closing. At Closing, Buyer
and Seller shall deliver or cause to be delivered each of the following
instruments and documents:

 

(a) Escrow Instructions. Escrow instructions (as described in Section 10(b)).

 

(b) Settlement Statement. A fully executed settlement statement.

 

(c) Notice to Tenants. A duly executed notice to each of the tenants under the
Leases.

 

17. Prorations and Adjustments.

 

(a) The following items shall be prorated and adjusted based upon the number of
calendar days in the measuring period between Seller and Buyer as of midnight on
the date of Closing, except as otherwise specified:

 

(1) Taxes. All real estate taxes and assessments (“Taxes”) assessed against the
Property for the year of Closing shall be prorated as follows: Seller will be
responsible for the payment of Taxes applicable to the period before the Closing
Date, and Buyer will be responsible for the period on and after the Closing
Date. Seller acknowledges that the actual taxes and assessments for the year in
which the Closing Date occurs are not known as of the date hereof, so the
parties shall make such proration based upon One Hundred percent (100%) of the
tax bill for the Property for 2011 (the “Estimated Taxes”). Once Taxes for the
year in which the Closing occurs are determined, if such amount varies from the
Estimated Taxes by more than five percent (5%), then such amount shall be
reconciled as if he actual amount of the Taxes had been known at the Closing,
and the amount of the prorations will be adjusted as applicable. All prorations
of Taxes shall be final upon the Closing. The provisions of this Section
17(a)(1) shall survive Closing.

 

(2) Utilities. All utilities shall be prorated based upon estimates using the
most recent actual invoices. Seller shall receive a credit for the amount of
deposits, if any, with utility companies that are transferable and that are
assigned to Buyer at the Closing. In the case of non-transferable deposits,
Buyer shall be responsible for making any security deposits required by utility
companies providing service to the Property.

 

(3) Collected Rent. Buyer shall receive a credit for any rent and other income
(and any applicable state or local tax on rent) under Leases collected by Seller
before Closing that applies to any period after Closing. Uncollected rent and
other uncollected income shall not be prorated at Closing. After Closing, Buyer
shall apply all rent and income collected by Buyer from a tenant (x) first to
such tenant’s rental obligations for the month in which the Closing occurs, (y)
next to such tenant’s monthly rental for the month in which the payment is made,
and (z) then to arrearages in the reverse order in which they were due,
remitting to Seller, after deducting collection costs, any rent or expense
reimbursements properly allocable to Seller’s period of ownership. Buyer shall
bill and attempt to collect such rent arrearages in the ordinary course of
business, but shall not be obligated to engage a collection agency or take legal
action to collect any rent arrearages. Any rent or other income received by
Seller or Buyer after Closing which are owed to Seller or Buyer shall be
remitted to Seller or Buyer as applicable, promptly after receipt.

 

14

 

 

 

(b) Tenant Security Deposits. All unapplied tenant security deposits (and
interest thereon if required by law or contract to be earned thereon) under the
Leases, shall be credited to Buyer at Closing.

 

(1) Service Contracts. With respect to any contracts that are assumed by Buyer
and survive the Closing, Seller shall receive a credit for prepaid charges and
premiums applicable to Buyer’s period of ownership. The Buyer shall receive a
credit for any payments made in arrears. In addition and without limitation of
the foregoing, Buyer shall receive a credit under any assumed contract (each a
“Service Provider Contract”) in which Seller has received any advance payments
or other income from the servicer provider under such Service Provider Contract
in exchange for agreeing to enter into such Service Provider Contract
(regardless of whether such advance payment or other income was paid in a lump
sum or in installments). Any lump sum payments shall be pro-rated on a straight
line basis over the term of any applicable Service Provider Contract.

 

(2) Owner Deposits. Seller shall be entitled to the return of all bonds,
deposits, letters of credit, set aside letters or other similar items, if any,
that are outstanding with respect to the Property that have been provided by
Seller or any of its affiliates, agents or investment advisors to any
governmental agency, public utility, or similar entity (collectively, “Owner
Deposits”). Buyer shall replace such Owner Deposits. To the extent that any
funds are released as a result of the termination of any Owner Deposits for
which Seller did not receive a credit, such funds shall be delivered to Seller
immediately upon their receipt.

 

(c) Final Prorations. With regards to any prorations set forth in this Section
17 that are based upon estimates, such prorations shall be readjusted based upon
the actual bills after the Closing and before the expiration of the Limitation
Period. The provisions of this Section 17(c) shall survive Closing.

 

18. Default; Termination. (a) IF THE CLOSING FAILS TO OCCUR BECAUSE OF BUYER’S
DEFAULT, THE DEPOSIT SHALL BE RETAINED BY SELLER AS LIQUIDATED DAMAGES. THE
PARTIES HERETO EXPRESSLY AGREE AND ACKNOWLEDGE THAT SELLER’S ACTUAL DAMAGES IN
THE EVENT OF A DEFAULT BY BUYER WOULD BE EXTREMELY DIFFICULT OR IMPRACTICABLE TO
ASCERTAIN BECAUSE OF THE NATURE OF THE PROPERTY AND THAT THE AMOUNT OF THE
DEPOSIT REPRESENTS THE PARTIES’ REASONABLE ESTIMATE OF SUCH DAMAGES. THE PAYMENT
OF SUCH AMOUNT AS LIQUIDATED DAMAGES IS NOT INTENDED AS A FORFEITURE OR PENALTY
WITHIN THE MEANING OF ANY APPLICABLE LAWS, BUT IS INTENDED TO CONSTITUTE
LIQUIDATED DAMAGES TO SELLER. NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED
IN THIS SECTION 18, SELLER AND BUYER AGREE THAT THIS LIQUIDATED DAMAGES
PROVISION IS INTENDED TO BE SELLER’S SOLE AND EXCLUSIVE REMEDY FOR A DEFAULT BY
BUYER, BUT IS NOT INTENDED AND SHOULD NOT BE DEEMED OR CONSTRUED TO LIMIT IN ANY
WAY BUYER’S INDEMNIFICATION OBLIGATIONS UNDER THIS AGREEMENT.

15

 

 

 

SELLER’S INITIALS:     BUYER’S INITIALS:  [image_001.jpg]              

  

(b) If Seller defaults in any material respect hereunder, then provided Buyer is
not in default any material respect, Buyer may, at its sole election, either:

 

(1) Terminate this Agreement, whereupon the Deposit shall be promptly returned
to Buyer and neither party shall have any further liability or obligation to the
other, except for the provisions of this Agreement which are expressly stated to
survive the termination of this Agreement; or

 

(2) Assert and seek judgment against Seller for specific performance with
respect to one or more (at Buyer’s election) of the properties that comprise the
Property; provided that if Buyer elects to purchase less than all of such
properties, then the Purchase Price will be reduced to the percentage of the
original Purchase that the number of properties homes purchased bears to the
original number of properties that comprise the Property. If a court of
competent jurisdiction determines that the remedy of specific performance is not
available to Buyer, then Buyer shall have the right to assert and seek judgment
against Seller for actual contract damages.

 

19. Expenses.

 

(a) All recording fees respecting the Deed, title insurance premiums for the
Title Policy, all state and county transfer taxes, brokerage fees and
commissions, and one-half (½) of the fee charged by Escrow Holder, shall be
borne and paid by Buyer.

 

(b) One-half (½) of the fee charged by Escrow Holder shall be borne and paid by
Buyer.

 

(c) All other costs, charges, and expenses shall be borne and paid as provided
in this Agreement, or in the absence of such provision, in accordance with
custom where the properties in question are located.

 

20. Intermediaries.

 

(a) Seller represents to Buyer, and Buyer represents to Seller, that there are
no fees owed to any broker, finder, or intermediary of any kind with whom such
party has dealt in connection with this transaction. If any claim is made for
broker’s or finder’s fees or commissions in connection with the negotiation,
execution or consummation of this Agreement or the transactions contemplated
hereby, each party shall defend, indemnify and hold harmless the other party
from and against any such claim based upon any statement, representation or
agreement of such party, which obligation shall survive Closing.

 

16

 

 

21. Destruction of Improvements..

 

(a) If, prior to Closing, any of the Improvements on any of the properties that
comprise the Property are damaged or destroyed such that the cost of repair or
replacement of such improvements is material (“Material Damage”), or a
condemnation proceeding is commenced or threatened in writing by a governmental
or quasi-governmental agency with the power of eminent domain (“Condemnation”),
then:

 

(1) Buyer may elect, within fourteen (14) days from receipt of notice of said
Material Damage, or notice of a Condemnation, by written notice to Seller, to
exclude the individual property affected by such event from this transaction;
provided that if more than twenty-five percent (25%) of the properties that
comprise the Property suffer Material Damage, or become the subject of a
Condemnation, then Buyer may terminate this Agreement. If necessary, the time of
Closing shall be extended to permit Buyer to evaluate and make the elections
contemplated in this Section 21. If Buyer elects to terminate this Agreement in
accordance with this Section 21, then the Deposit shall be returned to Buyer
and, except for the provisions of this Agreement that expressly survive Closing
or earlier termination of this Agreement, this Agreement shall be void and of no
further force and effect, and neither party shall have any liability to the
other by reason hereof; or

 

(2) if Buyer elects to exclude certain properties from this transaction, and
proceed to the Closing, then the Purchase Price will be reduced to a fraction of
the original Purchase Price equal to the ratio of the properties that Buyer
purchases to the number of properties that originally comprised the Property.
If, however, it is determined that any damage to one or more properties does not
constitute a Material Damage, or Buyer elects to purchase one or more properties
that have suffered Material Damage, then the transaction contemplated hereby
shall be closed without a reduction in the Purchase Price, and Seller shall
assign to Buyer Seller’s rights in any insurance proceeds or Condemnation award
to be paid to Seller in connection with such damage or Condemnation, and, in the
case of Material Damage, Seller shall pay to Buyer an amount equal to the
deductible under Seller’s policy of casualty insurance and Seller shall execute
and deliver to Buyer all required proofs of loss, assignments of claims and
other similar items.

 

(b) For purposes of this Section 21, damage or destruction will be considered
“Material Damage” if one or more of the properties that comprise the Property
are rendered uninhabitable, or if the time to repair such damage, despite
reasonable expectations with respect to repairs, is reasonably by Buyer to
exceed three months. If, prior to Closing, any of the improvements on the
Property are damaged or destroyed and such damage is not Material Damage, Buyer
shall remain obligated to close hereunder with no abatement in the Purchase
Price. At Closing, Seller shall assign to Buyer Seller’s rights in any insurance
proceeds to be paid to Seller in connection with such damage or destruction, and
Buyer shall receive a credit against the Purchase Price in an amount equal to
the deductible amount under Seller’s casualty insurance policy.

 

17

 

 

22. General Provisions.

 

(a) Entire Agreement. This written Agreement, including all Exhibits attached
hereto and documents to be delivered pursuant hereto, shall constitute the
entire agreement and understanding of the parties, and there are no other prior
or contemporaneous written or oral agreements, undertakings, promises,
warranties, or covenants not contained herein.

 

(b) Amendments in Writing. This Agreement may be amended only by a written
memorandum subsequently executed by all of the parties hereto.

 

(c) Waiver. No waiver of any provision or condition of this Agreement by any
party shall be valid unless in writing signed by such party. No such waiver
shall be taken as a waiver of any other or similar provision or of any future
event, act, or default.

 

(d) Time of the Essence. Time is of the essence of this Agreement. However, if
Buyer is acting diligently and in good faith to proceed with the consummation of
the transaction contemplated by this Agreement on the Closing Date, Seller will
agree, upon the written request of Buyer, to extend the Closing Date up to three
(3) business days. In the computation of any period of time provided for in this
Agreement or by law, any date falling on a Saturday, Sunday or legal holiday
when banks are not open for business in the State where the Property is located,
will be deemed to refer to the next day which is not a Saturday, Sunday, or
legal holiday when banks are not open for business in such State.

 

(e) Severability. If any provision of this Agreement is rendered unenforceable
in whole or in part, such provision will be limited to the extent necessary to
render the remainder of the Agreement valid, or will be deemed to be removed
from this Agreement, as circumstances require, and this Agreement shall be
construed as if said provision had been incorporated herein as so limited, or as
if said provision has not been included herein, as the case may be.

 

(f) Headings. Headings of sections are for convenience of reference only, and
shall not be construed as a part of this Agreement.

 

(g) Successors and Assigns. This Agreement shall be binding upon and shall inure
to the benefits of the parties hereto, and their respective successors, and
permitted assigns. This Agreement may not be assigned by either party without
the consent of the other party, except that Buyer may, without consent from
Seller, assign this Agreement to an affiliate of Buyer, or any entity formed by
Buyer for the purpose of acquiring or taking title to the Property; provided
that such assignment will not release Buyer from its obligations under this
Agreement. Any assignment in accordance with this Section 22(g) will entitle the
assignee thereunder to all rights and benefits, and subject such assignee to all
obligations, of Buyer hereunder.

 

(h) Notices. All notices and other communications required or permitted
hereunder shall be in writing and shall be mailed, or sent by Federal Express,
UPS or other recognized overnight courier service for next business day
delivery, or sent by facsimile transmission or electronic mail (so long as
reasonable evidence that such notice was sent and received is obtained by the
sending party). Any notice provided hereunder shall be deemed to be given when
sent in accordance with this provision, but any time to respond to such notice
as provided in this Agreement will not commence until the actual receipt of the
notice. Notices will be deemed valid if sent to the parties as follows:

 

18

 

 

 

IF TO BUYER

 

Reven Acquisitions, LLC

7911 Herschel Avenue, Suite 201

La Jolla, California 92037

Phone: 858-459-4000

e-mail: cmc@revencapital.com

Attention: Chad Carpenter and Michael Soni

 

 

with a copy to:

 

Greenberg Traurig, LLP

1840 Century Park East

Suite 1900

Los Angeles, California 90067

Phone: (310) 586-6505

e-mail: treisterd@gtlaw.com

Attention: Dana S. Treister

 

with an additional copy to:

 

Greenberg Traurig, LLP

1840 Century Park East

Suite 1900

Los Angeles, California 90067

Phone: (310) 586-7855

e-mail: presants@gtlaw.com

Attention: Sandy Presant

 

IF TO SELLER:

 

WRI Capital Group II LLC

972 Commerce Center Court

Fort Myers, Florida 33908-3606

Phone: (239) 243 - 0009

e-mail: cbrechbill@wricapitalgroup.com

Attention: Mr. Colin Brechbill

 

19

 

 

IF TO ESCROW HOLDER:

 

Feldman Law Offices, LLC

1847 Peeler Road - Suite C

Dunwoody, Georgia 30338

Phone: (770) 393-4757

e-mail: larry@feldman-law.net

Attention: Larry Feldman

 

 

or to such additional or other persons, at such other address or addresses as
may be designated by notice from Buyer or Seller, as the case may be, to the
other. Notices by mail shall be sent by United States certified or registered
mail, return receipt requested, postage prepaid, and shall be deemed given upon
receipt or refusal of receipt. Notices by facsimile or electronic mail shall be
deemed given and effective upon receipt or refusal of receipt. Notices by
overnight courier shall be deemed given and effective upon receipt or refusal of
receipt from Federal Express, UPS or another recognized overnight courier
service.

 

(i) Governing Law; Venue. To the extent enforceable, the parties agree that this
Agreement shall be governed in all respects by the internal laws of the State of
Georgia; provided that if the dispute involves an individual property the law of
the State where such property is located will apply. In any dispute arising out
of or related to this Agreement, an action must be brought in Federal or State
court, as applicable, in the County of Los Fulton, Georgia. The provisions of
this Section 22(i) will survive the termination of this Agreement.

 

(j) Counterparts. This Agreement may be executed in any number of identical
counterparts, any or all of which may contain the signatures of less than all of
the parties, and all of which shall be construed together as but a single
instrument.

 

(k) Attorneys’ Fees. If any action or proceeding brought by either party against
the other under this Agreement, the prevailing party shall be entitled to
recover all costs and expenses including its attorneys’ fees in such action or
proceeding in such amount as the court may adjudge reasonable. The prevailing
party shall be determined by the court based upon an assessment of which party’s
major arguments made or positions taken in the proceedings could fairly be said
to have prevailed over the other party’s major arguments or positions on major
disputed issues in the court’s decision. If the party that commenced or
instituted the action, suit or proceeding dismisses or discontinues it without
the concurrence of the other party, such other party shall be deemed the
prevailing party. The provisions of this Section 22(k) will survive any
termination of this Agreement.

 

20

 

 

 

(l) Construction. This Agreement will not be construed more strictly against
either party by virtue of the fact that it was prepared by one party or its
counsel, it being recognized that each party hereto has had the opportunity to
review, have its counsel review, and provide input into this Agreement. All
words herein that are expressed in the neuter gender shall be deemed to include
the masculine, feminine and neuter genders and any word herein that is expressed
in the singular or plural shall be deemed, whenever appropriate in the context,
to include the plural and the singular.

 

(m) Reporting Obligations. Seller and Buyer hereby designate Escrow Holder to
act as and perform the duties and obligations of the “reporting person” with
respect to the transaction contemplated by this Agreement for purposes of 26
C.F.R. Section 1.6045-4(e)(5) relating to the requirements for information
reporting on real estate transactions. If required under applicable law, Seller,
Buyer and Escrow Holder shall execute at Closing a Designation Agreement
designating the Escrow Holder as the reporting person with respect to the
transaction contemplated by this Agreement.

 

(n) 1031 Exchange. Either party may involve this transaction in a like-kind
exchange under Internal Revenue Code Section 1031, the cost and expense of which
will be borne solely by the party invoking such structure. Each party shall
reasonably cooperate with the other in such structure, provided that the party
that is not participating in a like-kind exchange shall incur no material costs,
expenses or liabilities in connection with the other’s exchange and will not be
required to take title to or contract for purchase of any other property. If
either party uses a qualified intermediary or exchange accommodator to
effectuate the exchange, any assignment of the rights or obligations of such
party shall not relieve, release or absolve such party of its obligations to the
other.

 

(o) Bulk Sales. Seller agrees to indemnify and hold Buyer, any permitted
assignee of Buyer’s rights under this Agreement and any of their respective
affiliates, officers, directors, shareholders, members, partners, agents,
employees and advisors (collectively, the “Indemnified Parties”) harmless from
and against any and all claims, damages, losses, costs, expenses, liens, actions
and causes of actions (including, without limitation, reasonable attorneys’ fees
and expenses) that may be incurred by, or asserted against, Buyer, any of the
other Indemnified Parties or the Property by reason of either such noncompliance
with the Bulk Sales laws applicable in the state or states where the Property is
located, or the failure of Seller to have paid any taxes, penalties or interest
which are the subject of such laws. The provisions and obligations of this
Section 24(o) shall survive the Closing.

 

21

 

 

 

(p) Confidentiality. Buyer and its representatives shall hold in strictest
confidence all data and information obtained with respect to the operation and
management of the Property, whether obtained before or after the execution and
delivery hereof, and shall not use such data or information for purposes
unrelated to this Agreement or disclose the same to others except as expressly
permitted hereunder. The preceding sentence shall not be construed to prevent
Buyer from disclosing to its prospective lenders or investors, or to its
officers, directors, attorneys, accountants, architects, engineers and
consultants to perform their designated tasks in connection with Buyer’s
inspection and proposed acquisition of the Property, provided Buyer advises any
such party of the confidential nature of the information disclosed. However,
neither party shall have this obligation concerning information which: (a) is
published or becomes publicly available through no fault of either the Buyer or
Seller; (b) is rightfully received from a third party; or (c) is required to be
disclosed by law. Notwithstanding the preceding, nothing in this Agreement will
prevent or be deemed to limit Buyer’s ability to disclose the existence of this
Agreement, and the nature of any material terms herein, to the Securities and
Exchange Commission or any other governmental agency to which Buyer, or its
successors hereunder, have a disclosure obligation under any applicable law.

 

[SIGNATURE PAGE FOLLOWS]

 

22

 

 

IN WITNESS WHEREOF, the parties have caused this Agreement to be executed as of
the day and year first above written.

 

 

SELLER

 

WRI Capital Group II LLC, Georgia limited liability company

 

By: /s/ Lance Popp                            
Name:  Lance Popp

 

 

 

BUYER

 

 

Reven Acquisitions, LLC, a Delaware limited liability company

 

 

 

By: /s/ Chad Carpenter                     

          Chad Carpenter
          Chief Executive Officer

 

 

23

 

 

LIST OF EXHIBITS AND SCHEDULES

 

EXHIBITS DESCRIPTIONS 1. EXHIBIT A DESCRIPTION AND VALUES OF PROPERTIES 2.
EXHIBIT B LIST OF CONTRACTS 3. EXHIBIT C FORM OF DEED 4. EXHIBIT D FORM OF BILL
OF SALE 5. EXHIBIT E FORM OF ASSIGNMENT OF LEASES AND CONTRACTS 6. EXHIBIT F
FORM OF FIRPTA AFFIDAVIT     SCHEDULES DESCRIPTIONS 1. 6(a)(3) PROPERTY
INFORMATION    

 

 

 

 

 

 

EXHIBIT A

 

DESCRIPTION OF PROPERTies

 

 

No.   Address   Zip Code    Price  1   9182 Jefferson Village Drive Covington,
Georgia   30016   $65,763.61  2   1740 Camden Forrest Trail Riverdale, Georgia 
 30296   $69,749.28  3   11352 Michelle Way Hampton, Georgia   30228  
$67,756.45  4   7220 Little Fawn Parkway Palmetto, Georgia   30268   $67,756.45 
5   205 Highgate Trail, Covington, Georgia   30016   $69,749.28  6   5242
Station Circle, Norcross GA   30238   $71,742.12  7   615 Cowan Road Covington,
Georgia   30016   $73,734.96  8   110 Bear Run Ct Palmetto, GA   30268  
$67,756.45  9   924 Lake Terrace Drive, Stone Mountain, Georgia   30088  
$69,749.28  10   4860 Lost Colony Stone Mountain, GA   30088   $71,742.12     
        $695,500.00 

 

 

 

 

Exhibit A – Page 1

 

 

 

 

EXHIBIT B

 

LIST OF CONTRACTS

 

 

1.

 

 

Exhibit B – Page 1

 

 

 

 

EXHIBIT C

 

FORM OF DEED

 

 

 

 

(Above Space for Recording Information)

 

 

 

 

STATE OF GEORGIA

COUNTY OF FULTON

 

LIMITED WARRANTY DEED

 

 

THIS INDENTURE is made as of the ___ day of July, 2012, by and between WRI
CAPITAL GROUP II, LLC a Georgia limited liability company, (hereinafter referred
to as "Grantor"), and REVEN ACQUISITIONS, LLC, a Delaware limited liability
company (hereinafter referred to as “Grantee”); the designation “Grantor” and
“Grantee” as used herein shall include said named parties and their respective
heirs, successors and assigns, except as hereinafter set forth as to Grantor,
and shall include the singular, plural, masculine, feminine or neuter as
required by context.

 

W I T N E S S E T H

 

GRANTOR, for and in consideration of the sum of Ten and No/100 Dollars ($10.00)
and other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, has granted, bargained, sold, aliened, conveyed, and
confirmed, and by these presents does grant, bargain, sell, alien, convey and
confirm unto Grantee, all of Grantor’s interest in all that tract or parcel of
land lying and being in Land Lot ___ of the ____ District, _____ County,
Georgia, and being more particularly described on Exhibit “A”, attached hereto
and made a part hereof by this reference, together with all improvements now
located thereon (collectively, the “Property”).

 

TO HAVE AND TO HOLD the Property, together with any and all of the rights,
members and appurtenances thereof, to the same being, belonging or in anywise
appertaining to, the only proper use, benefit and behoof of the Grantee and the
heirs, legal representatives, successors and assigns of Grantee forever IN FEE
SIMPLE.

 

GRANTOR will warrant and forever defend the right and title to the Property unto
Grantee and the heirs, legal representatives, successors and assigns of Grantee,
against the claims of all persons claiming through the Grantor, but not
otherwise.

 

Exhibit C – Page 1

 

 

 

 

IN WITNESS WHEREOF, the Grantor has caused this instrument to be signed, sealed
and delivered as of the day of first above written.

 

  

Signed, sealed and delivered in the

presence of:

 

 

 

_______________________________

Unofficial Witness

 

 

 

_______________________________

Notary Public

 

My Commission Expires:

 

[Affix Notarial Seal]

 

WRI CAPITAL GROUP II, LLC

 

 

 

 

By:______________________________
      James Lance Popp, Managing Member

 

 

 

 

 

 

 

 

 Exhibit C – Page 2

 

 

 

 

 

EXHIBIT D

 

FORM OF BILL OF SALE

 

____________________________, a(n) _________________ (“Seller”), for good and
valuable considerations, receipt and sufficiency of which are hereby
acknowledged, does hereby quitclaim, sell, assign, transfer and set over to
_________________, a ____________ limited liability company (“Buyer”), all of
its right, title and interest, if any, in and to any Personal Property located
on and used in connection with the Property. Seller warrants that it owns such
Personal Property free and clear of liens and encumbrances of any persons
claiming by, through or under Seller.

 

Capitalized terms used herein shall have the meanings given to them in that
certain Single Family Homes Real Estate Purchase and Sale Agreement, dated as of
_____, 2012, between Seller and Buyer.

 

IN WITNESS WHEREOF, Seller has caused this bill of sale to be signed and sealed
in his name by its officer thereunto duly authorized this ____ day of _________,
2012.

 

SELLER:

 

_____________, a(n) _________ limited liability company

 

 

 

By: ______________________________
Name:____________________________
Its: ______________________________

 

 

Exhibit D – Page 1

 

 

 

 

 

EXHIBIT E

 

FORM OF ASSIGNMENT OF LEASES AND CONTRACTS AND CONTRACTS

 

THIS ASSIGNMENT OF LEASES AND CONTRACTS AND CONTRACTS (this “Assignment”) is
entered into as of the ____ of _______, 2012 (the “Effective Date”), between
______________, a(n) ___________ limited liability company (“Assignor”) and
________________, a(n) __________ limited liability company (“Assignee”)

 

RECITALS

 

Assignor has conveyed to Assignee that certain parcel of real property and
improvements located at ________ pursuant to that certain Single Family Homes
Real Estate Purchase and Sale Agreement, dated as of _________ ___, 2012 (the
“Agreement”) by and between Assignor, as Seller, and Assignee, as Buyer.
Capitalized terms not otherwise defined herein shall have the meaning given to
them in the Agreement.

 

Assignor now desires to assign and transfer to Assignee all of Assignor’s right,
title and interest in, to and under the Leases and the Contracts.

 

1. Property. The “Property” means the real property located in _________,
legally described in Exhibit A attached to this Assignment, together with the
building, structures and other improvements located thereon.

 

2. Leases. The “Leases” means those leases and occupancy agreements affecting
the Property which are described in Exhibit B attached to this Assignment.

 

3. Contracts. “Assumed Contracts” means those agreements (including any service,
maintenance, or repair contracts) that are listed on Exhibit C attached to this
Assignment that will survive the Closing.

 

4. Assignment. For good and valuable consideration received by Assignor, the
receipt and sufficiency of which are hereby acknowledged, Assignor hereby
grants, transfers and assigns to Assignee the entire right, title and interest
of Assignor in and to the Leases and the Contracts.

 

5. Assumption. Assignee hereby assumes and agrees to perform the obligations of
Assignor under the Leases and Contracts which accrue and are attributable to the
period from and after the Effective Date. Additionally, Assignee agrees to pay
all monetary obligations when due under the Contracts arising before the
Effective Date to the extent Assignee received a credit on the settlement
statement in connection with its purchase of the Property.

 

6. Successors and Assigns. This Assignment shall be binding upon and inure to
the benefit of Assignor and Assignee and their respective successors and
assigns.

 

7. Counterparts. This Assignment may be executed in any number of identical
counterparts, any or all of which may contain the signatures of fewer than all
of the parties but all of which shall be taken together as a single instrument.

 

Exhibit E – Page1

 

 

 

 

 

8. Governing Law. This Assignment shall be governed and interpreted in
accordance with the laws of __________________.

 

IN WITNESS WHEREOF, Assignor and Assignee have caused this Assignment of Leases
and Contracts to be executed as of this ______ day of ________________, 2012.

 

ASSIGNOR

 

______________, a(n)_____________ limited liability
company

 

 

By: ______________________________
Name:____________________________
Its: ______________________________

 

ASSIGNEE

 

_____________________

 

By: ______________________________
Name:____________________________
Its: ______________________________

 

 

Exhibit E – Page 2

 

 

 

 

 

 

EXHIBIT F

 

FORM OF FIRPTA AFFIDAVIT

 

Section 1445 of the Internal Revenue Code, as amended, provides that a
transferee of a United States real property interest must withhold tax if the
transferor is a foreign person. To inform the Transferee (hereinafter defined)
that withholding of tax is not required upon the disposition of a United States
real property interest by ______________, a(n) ________ limited liability
company (the “Transferor”) to ___________________, a(n) _______ limited
liability company (the “Transferee”) relating to the real property described on
Schedule A hereto (the “Transferred Interests”), the undersigned, being first
duly sworn upon oath, does hereby depose and say, and does hereby on behalf of
the Transferor represent that the following is true as of the date hereof:

 

1. __________________ is the______________________ of the Transferor, and is
familiar with the affairs and business of the Transferor;

 

2. The Transferor is not a foreign person; that is, the Transferor is not a
nonresident alien, a foreign corporation, foreign partnership, foreign trust or
foreign estate (as all such terms are defined in the Internal Revenue Code of
1986, as amended, and United States Treasury Department Income Tax Regulations
in effect as of the date hereof);

 

3. The Transferor is a ______________ duly organized, validly existing and in
good standing under the laws of the State of _________;

 

4. The Transferor’s United States employer identification number is
______________; and

 

5. The Transferor’s office address and principal place of business is c/o
__________________________.

 

6. Transferor is not a disregarded entity as defined in §1.1445-2(b)(2)(iii);

 

The undersigned and the Transferor understand that this affidavit and
certification may be disclosed to the United States Internal Revenue Service by
the Transferee and that any false statement contained herein could be punished
by fine, imprisonment, or both.

 

All terms (whether capitalized or not) used but not defined herein shall have
the same respective meanings as in the Internal Revenue Code of 1986, as
amended, and the United States Treasury Department Income Tax Regulations in
effect as of the date hereof.

 

Under penalties of perjury, we declare that we have examined this affidavit and
certificate, and to the best of our knowledge and belief, it is true, correct
and complete. We further declare that we have authority to sign this affidavit
and certificate on behalf of the Transferor.

 

Exhibit F – Page 1

 

 

 

 

IN WITNESS WHEREOF, Transferor has executed and delivered this FIRPTA Affidavit
as of _____, 2012

 

_______________________, a(n) ___________ limited liability
company

 

By: ______________________________
Name:____________________________
Its: ______________________________ 

 

 

Exhibit F – Page 2

 

 

 

 

 

SCHEDULE 6(a)(3)

PROPERTY INFORMATION

 

 

[SUBJECT TO FURTHER REVIEW AND DEAL-SPECIFIC DOCUMENTATION]

 

1.Copies of all Contracts listed in Exhibit B to this Agreement.

 

2.Leases for each property that comprises the Property. A copy of Seller’s rent
rolls for the calendar month in which the Closing occurs and the eleven calendar
months preceding the month in which the Closing occurs.

 

3.Copies of all certificates of occupancy and other licenses and permits.

 

4.Copies of all environmental, engineering, geo-technical reports.

.

5.Insurance loss histories for preceding three calendar years.

 

6.Copies of three most recent real estate tax bills.

 

7.A copy of the most recent surveys for the properties that comprise the
Property.

 

8.All internal operating statements prepared by Seller, all cash receipt
journals and bank statements relating to the properties, and Seller’s general
ledger, each for the period commencing in January 2011 and ending in the month
in which the Closing occurs.

 

9Schedule of tangible personal property.

 

10Detailed reports, including but not limited to aging summary, prepaid rents,
refundable security deposits, misc. income.

 

11Copies of utility bills for the past three months.

 

12Summary of pending litigation and claims.

 

13A schedule of all items of repair and maintenance performed by, or at the
direction of, Seller during the 12-month period preceding the Closing. Copies of
tenant maintenance and service request logs for the past three months.

 

14Capital expenses and fixed asset additions made by, or at the direction of,
Seller during the year preceding the Closing.

 

15Any proposed capital improvement budgets and pending proposals or executed
contracts for repairs and maintenance.