ASSOCIATION (AS DEFINED IN THE MASTER DECLARATION) OVER WHICH SELLER HAS
CONTROL TO BE REPLACED, IN EACH CASE CONSISTENT WITH PURCHASER'S OWNERSHIP OF
THE UNITS AND ITS NEW STANDING IN THE RESIDENTIAL ASSOCIATION.
THE BOOKS AND
RECORDS MAINTAINED BY OR ON BEHALF OF THE RESIDENTIAL ASSOCIATION SHALL CONTINUE
TO BE IN THE POSSESSION OF THE RESIDENTIAL ASSOCIATION. SELLER SHALL USE
REASONABLE EFFORTS TO CAUSE ANY OTHER DOCUMENTS, KEYS AND OTHER ITEMS USED IN
THE OPERATION OF THE PROPERTY TO BE PROVIDED TO PURCHASER. SELLER MAKES NO
REPRESENTATIONS REGARDING THE EXISTENCE OR ADEQUACY OF SUCH DOCUMENTS OR ITEMS
FOR USE IN MANAGEMENT OR OPERATION OF THE PROPERTY. THE FOREGOING SHALL NOT
INCLUDE THE SEPARATE BOOKS, RECORDS, CORRESPONDENCE AND OTHER DOCUMENTATION OF
SELLER LOCATED AT ITS OFFICES, NOR SHALL IT INCLUDE ANY COMPUTER SOFTWARE OR
COMPUTER PROGRAMS USED BY THE MANAGER OF THE PROPERTY OR SELLER IN CONNECTION
WITH THE PROPERTY, IT BEING UNDERSTOOD AND AGREED THAT THE FOREGOING ITEMS ARE
NOT PART OF THE "PROPERTY" TO BE CONVEYED TO PURCHASER HEREUNDER. AFTER THE
CLOSING, SELLER SHALL HAVE THE RIGHT TO INSPECT THE BOOKS AND RECORDS OF THE
PROPERTY TO VERIFY THAT PURCHASER IS REMITTING TO SELLER ALL AMOUNTS TO BE
REMITTED TO SELLER ACCORDING TO THE TERMS OF THIS AGREEMENT, AND FOR ANY OTHER
PURPOSE RELATED TO SELLER'S PRIOR OWNERSHIP OF THE PROPERTY, AND THIS PROVISION
SHALL SURVIVE CLOSING.
4.7
PRESERVATION OF RIGHT TO CONTEST. SELLER
RESERVES THE RIGHT TO CONTEST AFTER CLOSING TAXES AND ASSESSMENTS WITH RESPECT
TO THE PROPERTY AND INTEREST OR PENALTIES PERTAINING THERETO, TO THE EXTENT SAME
ARE APPLICABLE TO PERIODS PRIOR TO CLOSING, AND SELLER SHALL BE ENTITLED TO ANY
REFUNDS MADE WITH RESPECT TO SUCH CONTESTED TAXES. ALL TAXES IMPOSED BECAUSE OF
A CHANGE OF USE OR OWNERSHIP OF THE PROPERTY AFTER OR IN CONNECTION WITH THE
CLOSING SHALL BE FOR THE ACCOUNT OF PURCHASER, AND PURCHASER SHALL INDEMNIFY AND
HOLD SELLER HARMLESS OF, FROM AND AGAINST ANY AND ALL COSTS, DAMAGES, EXPENSES,
CLAIMS, OR
9
LIABILITY ARISING FROM THE IMPOSITION OF ANY SUCH TAXES. THE PROVISIONS OF THIS
SECTION SHALL SURVIVE THE CLOSING.
ARTICLE V
REPRESENTATIONS, WARRANTIES, AND COVENANTS
5.1
REPRESENTATIONS AND WARRANTIES OF SELLER. AS
OF THE EFFECTIVE DATE, SELLER REPRESENTS AND WARRANTS TO PURCHASER AS FOLLOWS:
(A)
SELLER IS DULY FORMED AND VALIDLY EXISTING
UNDER THE LAWS OF THE STATE OF TEXAS AND IS ORGANIZED AND QUALIFIED UNDER THE
LAWS OF THE STATE OF TEXAS TO CONDUCT BUSINESS THEREIN.
(B)
SELLER HAS NO ACTUAL KNOWLEDGE OF ANY LEGAL
ACTIONS PENDING OR THREATENED AGAINST THE PROPERTY.
(C)
SELLER IS NOT A "FOREIGN PERSON" AS DEFINED
IN SECTION 1445 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED, AND THE INCOME
TAX REGULATIONS THEREUNDER.
5.2
NOTICE OF BREACH.
(A)
TO THE EXTENT THAT, BEFORE THE EXPIRATION
OF THE INSPECTION PERIOD, PURCHASER OBTAINS ACTUAL KNOWLEDGE OR IS DEEMED TO
KNOW THAT SELLER'S REPRESENTATIONS AND WARRANTIES ARE INACCURATE, UNTRUE OR
INCORRECT IN ANY WAY, SUCH REPRESENTATIONS AND WARRANTIES SHALL BE DEEMED
MODIFIED TO REFLECT SUCH