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HomeMy WebLinkAboutWelter, Robert and Rita-Real Estate Purchase Agreement-02.18.2008 -> F-a8 o,.o -iia , aU 08-/ 3,3 REAL ESTATE PURCHASE AGREEMENT This Real Estate Purchase Agreement(the "Agreement") is entered into as of February /ff , 2008 by and between the City of Waterloo, Iowa("Buyer") and Robert and Rita Welter, husband and wife ("Seller"). 1. OFFER TO BUY. Buyer hereby offers to buy, and the Seller by its acceptance agrees to sell, the real property situated in Waterloo, Black Hawk County, Iowa, locally known as 4012 Leversee Road, legally described as The Southwest Quarter of the Southwest Quarter of Section 32, Township 90 North, Range 13 West of the 5th P.M., Black Hawk County, Iowa, consisting of 38 acres, more or less; together with any easements and appurtenant servient estates, but subject to any reasonable easements of record for public utilities or roads, any zoning restrictions customary restrictive covenants and mineral reservations of record, if any, herein referred to as the "Property,"upon the terms and conditions set forth herein. 2. EARNEST MONEY AND PURCHASE PRICE. The Purchase Price shall be $350,000.00, of which $1,000.00 is on deposit with the law firm of Clark, Butler, Walsh & Hamann, to be held in trust. The entire Purchase Price shall be due and payable in full at closing. If this Agreement is not accepted by Seller or if it is rescinded by Buyer for failure of title or any other reason provided for in this Agreement, then the earnest money held in trust shall be returned to Buyer. 3. POSSESSION AND CLOSING. Title to the Property shall be delivered to Buyer at closing. Closing shall occur at City Hall, 715 Mulberry Street, Waterloo, on or before July 15, 2008 at such date and time as the parties shall mutually agree. After closing, Seller shall continue to have occupancy of the premises, both land and buildings, until December 31, 2011, to use as a personal residence and to farm the land, subject to Section 22 below. The right to farm the land shall be personal to Seller, and Seller may not rent out the land. Seller shall pay no rent to Buyer with respect to said post-closing occupancy, but shall be solely liable for all operating expenses, including but not limited to repairs and maintenance, care of grounds, utilities, phone service, garbage removal, and property taxes, if any. After December 31, 2011, Buyer shall have complete and unrestricted possession of the entire premises, unless before such date the parties enter into a lease agreement, in which case Buyer shall have complete and unrestricted possession of the entire premises upon expiration or termination of the lease term. The period during which Seller occupies the Property between the closing date and the date that Seller ceases to occupy the Property is the"Occupancy Period." 4. REAL ESTATE TAXES. The parties are uncertain whether the Property will be treated as taxable or tax exempt after closing. The parties intend by this Agreement to make Seller solely liable for all property taxes that accrue before or during the Occupancy Period. In view of such uncertainty, Seller shall pay taxes prorated to the closing date and any unpaid real estate taxes payable in prior years. At closing Seller shall pay Buyer, or Buyer shall be given a credit for, taxes (the "Prorated Taxes") from July 1, 2007 to the closing date, based upon the last known actual net real estate taxes payable according to public records. If additional property taxes become due during the Occupancy Period, Seller shall timely remit same directly to the county treasurer or shall promptly reimburse Buyer for same. If the Property ceases to be taxed during the Occupancy Period, and after all property taxes that shall have become due and payable in respect of the Property have been paid by Seller, Buyer will refund the Prorated Taxes to Seller. If instead the Property continues to be taxed throughout the Occupancy Period, then after the Occupancy Period terminates Buyer shall apply the Prorated Taxes to satisfaction of accrued property tax liabilities, and thereupon Seller's obligation with respect to payment of property taxes shall be deemed terminated. 5. SPECIAL ASSESSMENTS. Seller shall pay at time of closing all installments of special assessments which are a lien on the Property as of closing, and after closing Seller shall pay all special assessments or installments that arise after closing in connection with Seller's continued occupancy of the Property, including but not limited to charges for solid waste removal, sewage and maintenance, as each assessment or installment comes due, provided, that Seller's duty to pay any special assessment or installment thereof shall terminate upon conclusion of the Occupancy Period. 5.1 INDEMNITY. The provisions of this paragraph apply in respect of the "Occupancy Period." Except as to any negligence of Buyer or its agents, and to the extent not covered by insurance maintained by Seller or property insurance maintained by Buyer, Seller will protect, indemnify, and save harmless the Buyer from and against any and all loss, costs, damage, and expenses occasioned by, or arising out of, any act or omission causing or inflicting injury and/or damage to any person or property, happening or done in, upon, or about the Property, and due directly or indirectly to the use or occupancy thereof, or any part thereof, by Seller or any person claiming through or under the Seller. Prior to the Occupancy Period, Seller has had the opportunity to test the premises for toxic or hazardous substances, mold, and other environmental matters, and Seller agrees that its covenants of indemnity and hold harmless set forth in this paragraph shall include but not be limited to any claims, demands, losses, or causes of action arising from or relating to such matters (each an "Environmental Claim") by Seller or any person claiming through or under Seller. City agrees that Seller's indemnity shall not include any Environmental Claim asserted by or capable of assertion by the City, and City agrees not to assert any Environmental Claim against the Seller, provided that City's agreements set forth in this sentence shall in no way limit any liability that Seller may have under applicable state or federal environmental law, rule, or regulation. The provisions of this paragraph shall survive the closing of the sale and purchase transaction contemplated by this Agreement. 6. RISK OF LOSS AND INSURANCE. A. Seller agrees to maintain existing insurance to the date of closing and shall bear the risk of loss or damage to the Property to the date of closing. In the event of substantial damage or destruction prior to closing, the Buyer shall have the option to complete the closing and receive insurance proceeds regardless of the extent of damages or to declare this Agreement null and void. Seller may, at its option, maintain insurance for the home and buildings, fixtures, and personal property during the Occupancy Period, and Buyer may purchase additional insurance. Any insurance the Buyer carries in respect of the Property shall be for the sole benefit of Buyer and shall not name Seller as an additional insured. Buyer shall have no duty to use insurance proceeds to repair or rebuild any structure or other improvement on the Property, subject to paragraph 22.E below. If the residence is substantially destroyed during the Occupancy Period, Seller at its option may terminate its occupancy of the Homestead (defined in paragraph 22.D below) but continue to farm the Farmland, subject to Buyer's right of early termination with respect to the Farmland. 2 B. In addition, Seller shall procure and maintain liability insurance in a responsible company or companies authorized to do business in the State of Iowa, in amounts not less than $1,000,000 per occurrence, and $2,000,000 in the aggregate on an annual basis, which insurance shall cover the activities of Seller, its employees and agents, and shall protect Buyer against such claim, damages, costs or expenses on account of injury to any person or persons, or to any property belonging to any person or persons, by reason of such casualty, accident or other happening on or about the premises during the term thereof. Certificates or copies of said policies, naming the Buyer as an additional insured, and providing for thirty (30) days' notice to Buyer before cancellation, shall be delivered to Buyer no later than the closing date. Buyer shall provide no insurance coverage for the property or activities of Seller, its employees, or agents during the Occupancy Period. 7. FIXTURES. Included with the Property shall be all fixtures that integrally belong to, are specifically adapted to or are a part of the real estate, whether attached or detached. 8. CONDITION OF PROPERTY. The Property as of the date of this Agreement, including buildings, grounds, and all improvements, will be preserved by the Seller in its present condition until closing, ordinary wear and tear excepted. Seller sells the Property "AS IS" and makes no warranties, expressed or implied, as to the condition of the Property. Within 60 days after the acceptance of this Agreement, Buyer may, at its sole option and expense, have the property inspected by a person or persons of its choice to determine if there are any environmental or other deficiencies. Seller shall cooperate in providing reasonable access to Buyer's inspectors. Within this same period, the Buyer may notify the Seller in writing of any deficiency. The Seller shall immediately notify the Buyer in writing of what steps, if any, the Seller will take to correct any deficiencies before closing. The Buyer shall then immediately in writing notify the Seller that (1) such steps are acceptable, in which case this Agreement, as so modified, shall be binding upon all parties; or (2) that such steps are not acceptable, in which case this Agreement shall be null and void, and any earnest money shall be returned to Buyer. 9. ABSTRACT AND TITLE. Seller, at its expense, shall obtain from the Black Hawk County Abstract Company an abstract of title to the Property continued through a date that is within thirty (30) days of the closing, and shall deliver it to Buyer's attorney for examination. It shall show marketable title in Seller in conformity with this Agreement, Iowa law, and title standards of the Iowa State Bar Association. The Seller shall make every reasonable effort to promptly perfect the title. If closing is delayed due to Seller's inability to provide marketable title, this Agreement shall continue in force and effect until either party rescinds the Agreement after giving ten days' written notice to the other party. The abstract shall become the property of Buyer when the Purchase Price is paid in full. Seller shall pay the costs of any additional abstracting and title work due to any act or omission of Seller, including transfers by or the death of Seller or its assignees. 10. SURVEY. Buyer may, at Buyer's expense, have the Property surveyed and certified by a registered land surveyor prior to closing if a survey is required by law. If the survey shows an encroachment on the Property or if any improvements located on the Property encroach on lands of others,the encroachments shall be treated as a title defect. 3 11. ENVIRONMENTAL MATTERS. A. Seller warrants to the best of its knowledge and belief that there are no abandoned wells, solid waste disposal sites, hazardous wastes or substances, or underground storage tanks located on the Property, the Property does not contain levels of radon gas, asbestos, or urea-formaldehyde foam insulation which require remediation under current governmental standards, and Seller has done nothing to contaminate the Property with hazardous wastes or substances. Seller warrants that the property is not subject to any local, state, or federal judicial or administrative action, investigation or order, as the case may be, regarding wells, solid waste disposal sites, hazardous wastes or substances, or underground storage tanks. Seller shall also provide Buyer with a properly executed groundwater hazard statement showing no wells, solid waste disposal sites, hazardous wastes and underground storage tanks on the Property. B. The parties acknowledge that the Property has been a working farm for at least the period of Seller's ownership and that farm chemicals such as fertilizers, herbicides and pesticides have been applied to the land. The parties further acknowledge that Seller is likely to continue to apply such substances during the Occupancy Period, and Buyer consents to same provided that the types and quantities of such substances that are applied are reasonable and customary. C. Before closing Buyer may, at Buyer's expense, have the Property inspected further for the existence of any hazardous materials, substances, or wastes. Seller shall cooperate in providing reasonable access to Buyer's inspectors and engineers. If hazardous materials, substances, or wastes are discovered, Buyer shall give written notice to Seller within 60 days after acceptance of this Agreement. Buyer's obligation hereunder shall be contingent upon the removal of such materials, substances, conditions or wastes or other resolution of the matter reasonably satisfactory to Buyer. However, in the event Seller is required to expend any sum in excess of $1,000 to remove any hazardous materials, substances, conditions or wastes, Seller shall have the option to cancel this transaction and refund to Buyer all earnest money paid and declare this Agreement null and void. The expense of any inspection shall be paid by Buyer. The expense of any action necessary to remove or otherwise make safe any hazardous material, substances, conditions or waste shall be paid by Seller, subject to Seller's right to cancel this transaction as provided above. Buyer will compensate Sellers for any damage caused to their property or crop in connection with entry upon the land for purposes of environmental testing. D. During the Occupancy Period, Seller shall not store, spill, discharge, or otherwise release any hazardous materials, substances or wastes in or upon the Property, except as specifically permitted in paragraph B above. 12. DEED. Upon payment of the Purchase Price, Seller shall convey the Property to Buyer by warranty deed, free and clear of all liens, restrictions, and encumbrances except as provided in this Agreement. General warranties of the title shall extend to the time of delivery of the deed excepting liens and encumbrances suffered or permitted by Buyer. 13. JOINT TENANCY IN PROCEEDS AND IN REAL ESTATE. If Seller, immediately preceding acceptance of the offer, holds title to the Property in joint tenancy with full rights of 4 survivorship, and the joint tenancy is not later destroyed by operation of law or by acts of the Seller, then the proceeds of this sale, and any continuing or recaptured rights of Seller in the Property, shall belong to Seller as joint tenants with full rights of survivorship and not as tenants in common; and Buyer in the event of death of any Seller, agree to pay any balance of the price due Seller under this contract to the surviving Seller and to accept a deed from the surviving Seller consistent with Paragraph 16. 14. JOINDER BY SELLER'S SPOUSE. Seller's spouse, if not a titleholder immediately preceding acceptance, executes this Agreement only for the purpose of relinquishing all rights of dower, homestead, and distributive share or in compliance with Iowa Code § 561.13 and agrees to execute the deed for this purpose. 15. STATEMENT AS TO LIENS. If Buyer intends to assume or take subject to a lien on the Property, Seller shall furnish Buyer with a written statement prior to closing from the holder of such lien, showing the correct balance due. 16. USE OF PURCHASE PRICE. At time of settlement, funds of the Purchase Price may be used to pay taxes and other liens and to acquire outstanding interests, if any, of others. 17. APPROVAL OF COURT. N/A. 18. REMEDIES OF THE PARTIES. A. If Buyer fail to timely perform this Agreement, Seller may forfeit it as provided in the Iowa Code (Chapter 656), and all payments made shall be forfeited; or, at Seller's option, upon thirty days' written notice of intention to accelerate the payment of the entire balance because of Buyer's default (during which thirty days the default is not corrected), Seller may declare the entire balance immediately due and payable. Thereafter this Agreement may be foreclosed in equity and the Court may appoint a receiver. B. If Seller fails to timely perform this Agreement, Buyer has the right to have all payments made returned to it, or Buyer may require specific performance by Seller. C. Buyer and Seller are also entitled to utilize any and all other remedies or actions at law or in equity available to them, and the prevailing parties shall also be entitled to obtain judgment for costs and attorney fees. 19. NOTICE. Any notice under this Agreement shall be in writing and be deemed served when it is delivered by personal delivery or mailed by certified mail, addressed to the parties at the addresses given below. Seller: Robert and Rita Welter 4012 Leversee Road Waterloo, IA 50703 5 Buyer: City of Waterloo 715 Mulberry Street Waterloo, IA 50703 Attn: Noel Anderson, City Planner 20. GENERAL PROVISIONS. In the performance of each part of this Agreement, time shall be of the essence. Failure to promptly assert rights herein shall not, however, be a waiver of such rights or a waiver of any existing or subsequent default. This Agreement shall apply to and bind the successors in interest of the parties. This Agreement shall survive the closing. This Agreement contains the entire agreement of the parties and shall not be amended except by a written instrument duly signed by Seller and Buyer. Paragraph headings are for convenience of reference and shall not limit or affect the meaning of this Agreement. Words and phrases herein shall be construed as in the singular or plural number, and as masculine, feminine or neuter gender according to the context. 21. NO REAL ESTATE AGENT OR BROKER. Neither party has used the service of a real estate agent or broker in connection with this transaction. 22. ADDITIONAL PROVISIONS. A. The parties acknowledge that Buyer is acquiring the Property for economic development purposes. Buyer's rights and duties under this Agreement are assignable to any person or entity that will further the economic development objectives contemplated by Buyer. Any assignee shall be subject to the provisions of this Agreement. B. Special contingencies to effectiveness of Agreement. Notwithstanding any signatures below by representatives of Buyer, this Agreement is expressly subject to approval by the city council of Buyer. In addition, this Agreement is subject to expiration or termination of the acquisition agreement now pending between Seller and the City of Cedar Falls, Iowa. C. At closing, Seller shall execute an occupancy agreement with respect to the Property, providing for their occupancy after closing and until and including December 31, 2011. The occupancy agreement shall provide that no rental is payable to Buyer relating to Seller's rights of continuing occupancy and full utilization of the Property for residential, agricultural, or other lawful purposes at any time through December 31, 2011. The occupancy agreement shall also provide for successive options to enter into a lease agreement for periods of one year each, upon Buyer's consent to lease, determined at its sole discretion, and Seller's agreement to pay rent. During any renewal term, Sellers shall pay rent of$500 per month for the Homestead (defined in the next paragraph) and the prevailing market rate for the Farmland (defined in the next paragraph), which shall be determined by reference to the survey most recently published by Iowa State University Extension of Cash Rental Rates for Iowa, using the value for medium quality land in Black Hawk County as reported therein. 6 D. Notwithstanding the post-closing rights of Seller pursuant to paragraph 22.0 above, Buyer shall have the right to terminate Seller's occupancy rights at any time during the term thereof, by delivery of no less than 180-days' prior written notice to Seller. For purposes of this termination right, the Property shall be divided into two parts, the homestead consisting of the home, building, and environs not exceeding four (4) acres (the "Homestead"), and the remainder (the "Farmland") of the Property. In the event of termination with respect to the Farmland, Seller shall not be entitled to any damages, payment, or compensation of any kind except for any severance damages payable with respect to lost crops. In the event of termination with respect to the Homestead, Seller's sole compensation shall be an amount equal to $1,000 for each month between and including the month in which notice is delivered and December 2011. Buyer agrees that it shall not invoke its right of termination with respect to the Homestead or the Farmland unless said property is needed for a pending economic development project as evidenced by an approved and executed development agreement. E. In the event of destruction of the Homestead rendering the same uninhabitable, which destruction was not caused by the gross negligence or willful misconduct of Sellers, their agents or invitees, Sellers' compensation in lieu of occupancy of the Homestead shall be an amount equal to One Thousand Dollars ($1,000.00) for each month between and including the months in which the premises are rendered uninhabitable and December 2011. This provision shall take effect immediately upon execution of this Agreement and approval of the same by the Waterloo City Council, and shall include the period of time prior to closing. Upon making such payment, City shall be deemed to have exercised its right of termination with respect to the Homestead pursuant to this paragraph. If the Homestead is damaged or otherwise rendered uninhabitable but the damage is an insured loss that is capable of being repaired within 45 days at a cost of less than $20,000, City agrees to cause such repairs to be done, and the occupancy rights of Sellers shall continue thereafter. City shall pay no compensation to Sellers for temporary loss of their occupancy rights as a consequence of such damage, nor shall the Occupancy Period be tolled. If the Homestead is otherwise damaged or rendered uninhabitable but cannot be so repaired, then the Homestead shall be deemed permanently uninhabitable, Sellers' occupancy rights shall be deemed terminated as if the Homestead had been destroyed, and City shall pay to Sellers the compensation provided for in the first paragraph of this Section 22.E. F. The provisions of this Agreement, specifically including but not limited to Sections 3, 4, 5.1, 6, 11 and 22, are intended to have effect after the closing and therefore shall survive the closing and shall not merge into the deed. G. The purchase price shall be allocated $150,000 to the Homestead and $200,000 to the Farmland. 23. ENTIRE AGREEMENT. This Agreement represents the entire agreement between the parties, superseding all prior or contemporaneous understandings, negotiations, discussions, or agreements between the parties with respect to the subject matter hereof. 7 24. ACCEPTANCE. When accepted, this Agreement shall become a binding contract. If not accepted by Seller on or before February 11, 2008, this Agreement shall be null and void. Dated 2 '/ '0 g Accepted BUYER SELLER City of Waterloo, Iow By: 4.eo%ts't, Title: YYtia-y p C Robert M. Welter Title: C ;4. (ell( Rita M. Welter 8 'CJ c