HomeMy WebLinkAboutAgenda - 04-15-2025; 6-b - Purchase of Property for the Crisis Diversion Facility 1
ORANGE COUNTY
BOARD OF COMMISSIONERS
ACTION AGENDA ITEM ABSTRACT
Meeting Date: April 15, 2025
Action Agenda
Item No. 6-b
SUBJECT: Purchase of Property for the Crisis Diversion Facility
DEPARTMENT: Asset Management Services
(AMS)
ATTACHMENT(S): INFORMATION CONTACT:
1. Locator Map Travis Myren, County Manager, 919-
2. Conceptual Site Plan 245-2308
3. Purchase and Sale Contract Alan Dorman, AMS Director, 919-245-
2627
PURPOSE: To:
1) Review and approve the Purchase and Sale Contract for a 5-acre parcel of land located
off Waterstone Drive in Hillsborough to build a Crisis Diversion Facility; and
2) Authorize the County Manager to execute all necessary documents to close on the property
upon final review by the County Attorney.
BACKGROUND: In the FY 2024-34 Capital Investment Plan, the Board approved $2,047,155 to
design a Crisis Diversion Facility and $22,952,845 to construct it in FY 2025-26. Additionally, in
the FY 2024-34 CIP, the Board approved $1,100,000 to acquire land for the facility.
After an extensive search, the County identified a property near UNC Hospital in Hillsborough as
the best option for the Crisis Diversion Facility (Locator Map at Attachment 1). This property is
considered ideal because of its proximity to UNC Hospital, is already zoned for hospital use, and
is of sufficient size to allow for an attractive one-story facility with grounds for a large courtyard
and healing garden, as shown in the conceptual site plan (Attachment 2). The rezoning of the
property for hospital use was based on the developer's previously approved Master Plan with the
Town of Hillsborough and will save the County significant time in developing the site.
The County has already performed extensive due diligence on this property and found no issues
of concern. The review process included a phase I environmental assessment, a geotechnical
survey, and a review of the title records. Additionally, a preliminary site plan review was completed
with the Town of Hillsborough and no items of concern were found.
After extensive negotiation with the owners, Capkov Ventures, Inc., the County has agreed to
purchase the property for $1,350,000. The terms of the purchase include $25,000 in earnest
money, a 60-day inspection period, and that the County will close on the property by June 30,
2025. The agreement allows the closing date to be extended by two (2) 30-day periods, with an
additional fee of $10,000 per extension. The extension fees and the earnest money would be
credited to the sale when the County closes on the property.
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As part of the site development approval process, the Town of Hillsborough may require the
County and the owner to pay for the future construction of the road to the northern border of the
Roger Dale Stephens lot, at a cost not to exceed $35,000.
In the purchase and sale contract, the County also agrees to build stormwater features large
enough to handle the stormwater from the Capkov property that is located directly north of the
County's property, which Capkov intends to develop at a later time (a conceptual site plan is
provided at Attachment 2). Additionally, during the 60-day inspection period, the County and
Capkov must agree on a final site plan, easements to be conveyed to Capkov at closing, and a
declaration. Capkov requires the easements to allow it to install stormwater piping for the
stormwater features installed by the County. The declaration will cover the maintenance of
landscaping and the stormwater system, and restrictions on the owner's northern property that
would be deemed incompatible with the County's use.
Schedule
If the Board approves the purchase of the Waterstone site, the table below outlines the anticipated
schedule for the project.
Schedule
Select Construction Manager At Risk/
Complete Due Diligence of Waterstone
Site/Finalize Design Spring 2025
Complete Purchase of Waterstone site Summer 2025
Complete Construction Documents Summer 2025
Permitting Fall 2025
Bid/ Board Approval of Guaranteed
Maximum Price /Start of Construction Winter 2025
Grand Opening Winter 2026/Spring 2027
FINANCIAL IMPACT: In FY 2024-34 CIP, the Board approved $1,100,000 to purchase land. The
difference in cost between $1,100,000 and $1,350,000 will be covered by savings in design fees
and by moving money from construction originally planned for FY 2025-26 to the current fiscal
year. The movement of these funds is detailed in Budget Amendment#8-A and is described more
fully in the agenda abstract item seeking approval for the Gilbane Construction Manager at Risk
contract— also on this April 15, 2025 meeting agenda.
ALIGNMENT WITH STRATEGIC PLAN: This item supports:
• GOAL 2: HEALTHY COMMUNITY
OBJECTIVE 1. Improve harm reduction, prevention, and support services for adults and
children experiencing behavioral health issues, substance use disorder, and intellectual or
developmental disability.
OBJECTIVE 4. Reduce impacts and barriers for justice-involved children and adults
through deflection, diversion, therapeutic interventions, and re-entry support, including
housing.
RECOMMENDATION(S): The Manager recommends that the Board
1) Approve the Purchase and Sale Contract for a 5-acre parcel of land located off Waterstone
Drive in Hillsborough for the purpose of building a Crisis Diversion Facility; and
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2) Authorize the County Manager to execute all necessary documents to close on the property
upon final review by the County Attorney.
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Attachment 3
PURCHASE AND SALE CONTRACT
This purchase and sale contract ("Contract") is made as of the Effective Date by CAPKOV
VENTURES,INC.,a North Carolina business corporation("Seller")and ORANGE COUNTY,NORTH
CAROLINA, a political subdivision of the State of North Carolina("Buyer").
ARTICLE I
Basic Terms and Definitions
1.1 Basic Defined Terms.
BUYER: Orange County North Carolina
300 West Tryon Street
Hillsborough,North Carolina 27278
Attn: Travis Myren, County Manager
Tel: 919.245.2300
Email: tmyrenkoran eg c� n�c.gov
BUYER'S COUNSEL: Kennon Craver,PLLC
4011 University Drive
Suite 300
Durham,North Carolina 27707
Attn: Brian M. Ferrell
Tel: 919.490.0500
Email: bferrell(&kennoncraver.com
CLOSING DATE: June 30, 2025, as may be extended in accordance with Section 2.5.
EARNEST MONEY: The$25,000.00 in earnest money to be deposited with Escrow Agent
in accordance with Section 2.3, and any interest earned on that
earnest money.
EFFECTIVE DATE: The date(as set forth on the signature page to this Contract)on which
this Contract is executed by the last of Buyer and Seller.
ESCROW AGENT and TITLE Investors Title Insurance Company
COMPANY: P.O. Drawer 2687
Chapel Hill,North Carolina 27515
Attn: CommercialEscrow(&invtitle.com
INSPECTION PERIOD: The period beginning on the Effective Date and ending at 11:59 p.m.
on the date that is 60 days after the Effective Date.
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LAND: The land containing approximately 5 acres located on Waterstone
Drive, Hillsborough, NC and being portions of the property having
Orange County PINS 9873422375, 9873425271, 9873425076,
9873415972,9873416716,and 9873510737,as shown on Exhibit A,
together with all privileges,rights and easements appurtenant to that
land.
PURCHASE PRICE: $1,350,000.00
SELLER: Capkov Ventures, Inc.
112 Milton Street
Chapel Hill,North Carolina 27514
Attn: Eric Chupp
Tel: 919.260.7262
Email: ericbchuppnbellsouth.net
SELLER'S COUNSEL: Beemer,Hadler and Willett PA
1829 East Franklin Street, Suite 800B
Chapel Hill,North Carolina 27514
Attn: Wayne Hadler
Tel: whadler(&bhcwlaw.com
Email: 919.929.0391
1.2 Additional Defined Terms.
1.2.1 "Applicable Laws"means all statutes, codes, laws, ordinances, orders, rules and
regulations of any governmental authority applicable to the Property, including those relating to zoning,
subdivision,construction and land use.
1.2.2 "Bankruptcy Code"means Chapter 11 of the United States Code.
1.2.3 "Closing"is defined in Section 2.4.
1.2.4 "Declaration"is defined in Section 6.2.
1.2.5 "Declaration Delivery Date"is defined in Section 6.2.
1.2.6 "Deed"is defined in Section 7.1.1.
1.2.7 "Easements"is defined in Section 6.3.
1.2.8 "Easement Delivery Date"is defined in Section 6.3.
1.2.9 "Environmental Laws"means all present and future federal,state and local laws,
statutes,regulations,rules, ordinances and common law, and all judgments, decrees, orders, agreements or
permits, issued, promulgated, approved or entered thereunder by any government authority relating to
pollution or Hazardous Materials or protection of human health or the environment, including the
Comprehensive Environmental Response, Compensation and Liability Act(CERCLA), as amended.
1.2.10 "Extension Deposit"is defined in Section 2.5.
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1.2.11 "Financial Encumbrance"is defined in Section 4.1.2.
1.2.12 "Hazardous Materials" means any waste, pollutant, chemical, hazardous
material, hazardous substance, toxic substance, hazardous waste, special waste, solid waste, asbestos,
radioactive materials, polychlorinated biphenyls, petroleum or petroleum-derived substance or waste and
any other pollutant,material,substance or waste regulated under or as defined by any Environmental Laws.
1.2.13 "Improvements" means all improvements located on the Land and all fixtures
affixed to the Land or other improvements.
1.2.14 "Inspections"is defined in Section 3.1..
1.2.15 "Intended Use"means Buyer's development of the Property for a Crisis Diversion
Facility.
1.2.16 "Losses"means all losses, costs(including reasonable attorneys' and consultants'
fees), damages, obligations, claims or liabilities.
1.2.17 "Objection"is defined in Section 4.1.3.
l.2.18 "Objection Response"is defined in Section 4.1.3.
1.2.19 "OFAC"is defined in Section 5.1.10.
1.2.20 "Permitted Exceptions"is defined in Section 4.1.2.
1.2.21 "Plan Approval Period" is defined in Section 6.1.2.
1.2.22 "Property"means, collectively,the Land and the Improvements
1.2.23 "Property Documents"is defined in Section 6.5.
1.2.24 "Site Plan"is defined in Section 6.1.1.
1.2.25 "Subdivision Plat"is defined in Section 4.2.
1.2.26 "Subdivision Plat Delivery Date"is defined in Section 6.4.
1.2.27 "Taxes"is defined in Section 7.2.1(a).
1.2.28 "Title Commitment"is defined in Section 4.1.2.
1.2.29 "Unpermitted Exception"is defined in Section 4.1.2.
ARTICLE II
Agreement to Sell and Purchase
2.1 Property to Be Sold. For good and valuable consideration,the receipt and sufficiency of
which are acknowledged by Seller and Buyer, Seller agrees to sell, and Buyer agrees to purchase, the
Property.
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2.2 Purchase Price. Buyer shall pay the Purchase Price to Seller on the Closing Date by wire
transfer.
2.3 Earnest Money. Within ten (10) business days after the Effective Date, Buyer shall
deliver to Escrow Agent the Earnest Money. Escrow Agent shall hold the Earnest Money in an interest
bearing account with a financial institution insured by the Federal Deposit Insurance Corporation. Escrow
Agent shall hold and disburse the Earnest Money in accordance with the terms of this Contract, including
the terms on Exhibit B. At Closing,the Earnest Money will be applied against the Purchase Price.
2.4 Closing. The closing("Closing") shall occur through an escrow at the offices of Buyer's
Counsel on the Closing Date. All funds necessary for Closing shall be deposited with Buyer's Counsel and
held in a trust account with Truist Bank. Upon satisfaction of all closing conditions and deliveries
(including a title update confirming that title to the Property is in the condition required by this Contract
and the recordation of the Deed (as defined in Section 7.1.1(a)), Buyer and Seller shall direct Buyer's
Counsel to deliver the closing documents to the appropriate parties and make disbursements according to
the closing statement executed by Buyer and Seller.
2.5 Closing Date Extensions. Buyer shall have the right to adjourn and otherwise extend the
Closing Date for two (2)periods of thirty (30) days each by the payment of an addition $10,000 for each
such extension to the Escrow Agent (each an "Extension Deposit"). Each Extension Deposit is non-
refundable to Buyer except in the event of a breach by Seller and shall be applied to the Purchase Price at
Closing.
ARTICLE III
Inspection
3.1 Access and Inspection. Buyer's agents, contractors, employees and representatives may
enter the Property for the purposes of inspecting the Property, conducting soil tests, surveys, mechanical
and structural engineering studies, environmental investigations (including installing groundwater
monitoring wells, performing soil borings and analysis of the soil, groundwater, surface water, sediment
and other media at the Property),title examinations, and any other investigations and inspections as Buyer
may reasonably require to assess the condition of the Property (collectively, "Inspections"). All
Inspections shall occur at reasonable times and be conducted so as not to unreasonably interfere with the
use or operation of the Property.If Buyer desires to conduct any invasive testing at the Property,then Buyer
shall do so only after reasonable prior written notice to Seller (which shall be at least three (3) business
days in advance).As Seller's request,Buyer shall promptly furnish to Seller copies of any reports received
by Buyer related to its Inspections. The Inspections will not materially damage the Property except as is
ordinarily required for the performance of the Inspections. Buyer shall hold Seller harmless from and
against any claims for injury to person or for damage to property to the extent resulting from the Inspections,
except for claims arising out of. (a)any existing environmental contamination or latent defects on the
Property that are discovered by Buyer as a result of the Inspections, and any disclosure of such matters by
Buyer or its consultants to a governmental agency that may be required by Applicable Laws; and (b) any
matters arising directly or indirectly from the acts or omissions of Seller. Seller shall also cooperate in
good faith with Buyer and Buyer's agents and employees during the Inspection Period.
3.2 Inspection Period. Buyer may, for any reason(or for no reason),terminate this Contract
at any time prior to the end of the Inspection Period by delivering notice to Seller. If Buyer so terminates
this Contract,then Escrow Agent shall refund the Earnest Money to Buyer and neither party shall have any
further rights or obligations under this Contract(other than those that expressly survive termination of this
Contract). Buyer's failure to terminate this Contract prior to the end of the Inspection Period shall not
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constitute a waiver of any condition precedent to Closing or any other obligation of Seller under this
Contract.
ARTICLE IV
Title and Subdivision Plat
4.1 Title.
4.1.1 At Closing, Seller shall convey to Buyer good and marketable fee simple title to
the Property. For the purposes of this Contract, "good and marketable fee simple title"means fee simple
ownership that is (a) free of all claims, liens and encumbrances other than the Permitted Exceptions; and
(b) insurable by a title insurance company reasonably acceptable to Buyer at then current standard rates
under the standard form of ALTA owner's policy of title insurance(ALTA Form 2006),with the standard
or printed exceptions deleted and without exception other than for the Permitted Exceptions.
4.1.2 During the Inspection Period, Buyer shall obtain, at Buyer's expense, from Title
Company a current ALTA Commitment for Title Insurance ("Title Commitment"). Other than
Unpermitted Exceptions,any title exceptions appearing in the Title Commitment that Buyer does not object
to in writing by the end of the Inspection Period will be deemed permitted exceptions to Seller's title(those
exceptions not objected to, together with any other matters approved by Buyer in writing, are called
"Permitted Exceptions"). Each(a)matter affecting title to the Property that arises after the Effective Date
and that is not approved in writing by Buyer; and (b)financial encumbrance such as a deed of trust,
attachment,judgment, lien for delinquent taxes, mechanic's or materialman's lien, or other monetary lien
outstanding against any part of the Property (each a "Financial Encumbrance," collectively, the
"Financial Encumbrances") will be deemed an "Unpermitted Exception". Seller shall cure (by
removing from or satisfying on the public record) all Unpermitted Exceptions by Closing. Buyer's failure
to notify Seller of any Unpermitted Exception will not relieve Seller of its obligation to cure all Unpermitted
Exceptions by Closing.
4.1.3 Buyer may object to any title or non-title matters affecting the Property by
delivering notice to Seller by the end of the Inspection Period (each an "Objection," collectively, the
"Objections"). Within ten(10)days after Buyer delivers its notice of Objections,Seller shall deliver notice
to Buyer of Seller's election to cure or not cure each Objection("Objection Response"). Seller shall have
no obligation to cure an Objection (other than an Unpermitted Exception) that Seller does not commit to
cure in the Objection Response. If Seller fails to elect to cure any Objection within that ten(10)day period,
then Seller shall be deemed to have elected not to cure that Objection. If the Objection Response indicates
that Seller will not(or if Seller is deemed to have elected to not) cure one or more of the Objections, or if
Seller does not deliver an Objection Response within the time provided, then Buyer may terminate this
Contract on or before the later of the tenth(10`h)day after the Objection Response was received, or twenty
(20)days after the date of the Objection was delivered to Seller if no Objection Response was received,by
delivering notice to Seller, in which event the Earnest Money will be refunded to Buyer and all rights and
obligations of Seller and Buyer under this Contract shall terminate (other than those that expressly survive
termination of this Contract). If the Objection Response indicates that Seller will not(or if Seller is deemed
to have elected to not) cure one or more of the Objections, and Buyer does not terminate this Contract in
accordance with the preceding sentence, then (a)Buyer shall be deemed to have waived any Objection
which Seller did not agree to cure (and that Objection shall be a Permitted Exception), and(b) Seller shall
cure prior to Closing those Objections which Seller agreed to cure in the Objection Response. If Seller fails
to cure any Objection which Seller agreed to cure in the Objection Response or any Unpermitted Exception
by the Closing Date,then that failure shall constitute a material default by Seller, and Buyer may exercise
Buyer's rights under Section 8.2 of this Contract.
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4.2 Subdivision Plat. Seller, at its sole cost and expense, shall have a subdivision plat
prepared by a licensed surveyor, approved by all relevant governmental agencies, and recorded in the
Orange County Registry("Subdivision Plat").The Subdivision plat shall be provided to,and approved by,
Buyer prior to recording as provided in Section 6.4.The Subdivision Plat shall clearly define the boundaries
of the Property as a single tax parcel, include no encroachments, gaps, or other title defects, and locate the
placement of all existing utility lines and infrastructure that will serve the Property.
ARTICLE V
Representations,Warranties and Covenants
5.1 Representations and Warranties of Seller. Seller represents and warrants to Buyer that:
5.1.1 Seller is a business corporation, duly organized, validly existing and in good
standing under the laws of the State of North Carolina.
5.1.2 Seller has the power and authority,and has obtained all consents required,to enter
into this Contract and to consummate the sale of the Property in accordance with the terms of this Contract.
5.1.3 This Contract has been, and all of the documents to be delivered by Seller at
Closing will be, executed by an individual authorized to do so on behalf of Seller; and this Contract
constitutes, and those documents will constitute,the valid and binding obligations of Seller, enforceable in
accordance with their terms, except as enforceability may be limited by bankruptcy, insolvency or
reorganization laws or applicable principles of equity.
5.1.4 There are no pending or, to Seller's knowledge, threatened actions, suits or
proceedings affecting Seller or the Property and Seller is not aware of any facts which might result in any
such action, suit or other proceeding.
5.1.5 Seller has complied with all Applicable Laws affecting the Property;performance
of the Agreement will not result in the breach of, constitute any default under or result in the imposition of
any lien or encumbrance upon the Property under any agreement or other instrument to which Seller is a
party or by which Seller or the Property is bound.
5.1.6 Seller has received no written notice of any violation or potential violation of any
Applicable Laws,permits, or any private restrictive covenants affecting the Property.
5.1.7 There are no agreements affecting the Property or Seller that would be binding on
Buyer after Closing other than matters of record in the Orange County Register of Deeds.
5.1.8 There are no options or other agreements of any kind which have not been waived
and terminated,and Seller has no knowledge of any purchase contracts,options or other agreements of any
kind whereby any third party will have acquired or will have any right to acquire title or interest to all or
any portion of the Property.
5.1.9 Seller has not filed,and does not have any present intent to file,a voluntary petition
under the Bankruptcy Code or similar state law, and has not sought, and does not have any present intent
to seek protection or similar relief for debtors under any federal or state insolvency laws; and no petition in
any action or proceeding under the Bankruptcy Code or any similar state law has been filed against Seller,
and Seller has not made any assignment for the benefit of creditors or consented to the appointment of a
receiver or trustee for all or any part of its property.
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5.1.10 Seller is not a"foreign person"within the meaning of the Internal Revenue Code,
as amended, Sections 1445 and 7701 or the regulations promulgated thereunder. Further,neither Seller nor
any of its affiliates,partners,members, shareholders or other equity owners,employees,officers,directors,
representatives or agents is,nor will they become,a person or entity with whom U.S.persons or entities are
restricted from doing business under regulations of the Office of Foreign Asset Control ("OFAC"), of the
Department of the Treasury(including those named on OFAC's Specially Designated and Blocked Persons
List) or under any statute, executive order (including the September 24, 2001, Executive Order Blocking
Property and Prohibiting Transactions with Persons Who Commit, Threaten to Commit, or Support
Terrorism), or other governmental action and is not and will not engage in any dealings or transactions or
be otherwise associated with such persons or entities.
5.1.11 Seller certifies that, as of the date listed below and on the date of Closing, it is not
on the Final Divestment List as created by the State Treasurer pursuant to N.C.G.S. § 143-6A-4. In
compliance with the requirements of the Iran Divestment Act and N.C.G.S. § 143C-6A-5(b), Seller shall
not utilize in the performance of the Contract any subcontractor that is identified on the Final Divestment
List.
5.1.12 Seller understands that E-Verify is the federal E-Verify program operated by the
United States Department of Homeland Security and other federal agencies,or any successor or equivalent
program used to verify the work authorization of newly hired employees pursuant to federal law in
accordance with NCGS §64-25 et seq, and Seller is in compliance with the requirements of E-Verify and
Article 2 of Chapter 64 of the North Carolina General Statutes, and to the best of Seller's knowledge, any
subcontractors employed by me as a part of this Contract are in compliance with the requirements of E-
Verify and Article 2 of Chapter 64 of the North Carolina General Statutes.
5.1.13 The Property is located within the municipal boundaries of the Town of
Hillsborough.
5.1.14 The Property is properly zoned by the Town of Hillsborough for the Intended Use.
5.1.15 Seller has no actual knowledge of the presence or disposal,except as in accordance
with Applicable Law, on the Property of any Hazardous Materials. Seller has no actual knowledge of any
contamination of the Property from Hazardous Materials as may have been disposed of or stored on
neighboring tracts. The Property complies with all Environmental Laws.
5.1.16 The Property is not subject to regulation by an owners' association.
5.1.17 There is no pending lien or special assessment,other than ad valorem real property
taxes for the year 2025 to be made against the Property by any governmental authority.
5.1.18 The Property Documents delivered to Buyer constitute all of all the
information and documentation relating to the Property that is in Seller's possession or control.
Seller's representations and warranties set forth in this Agreement shall survive Closing for a period
of three(3)years.
5.2 Representations and Warranties of Buyer. Buyer represents and warrants to Seller that:
5.2.1 Buyer is a political subdivision of the State of North Carolina.
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5.2.2 Buyer has the power and authority to enter into this Contract and to consummate
the purchase of the Property in accordance with the terms of this Contract.
5.2.3 This Contract has been, and all of the documents to be delivered by Buyer at
Closing will be, executed by an individual authorized to do so on behalf of Buyer; and this Contract
constitutes,and those documents will constitute,the valid and binding obligations of Buyer,enforceable in
accordance with their terms, except as enforceability may be limited by bankruptcy, insolvency or
reorganization laws or applicable principles of equity.
5.2.4 There is no agreement,nor any judicial or administrative order or decree,to which
Buyer is a party or that is binding on Buyer which is in conflict with this Contract, or which challenges or
impairs Buyer's ability to perform its obligations under this Contract.
Buyer's representations and warranties set forth in this Agreement shall survive Closing for a
period of three(3)years.
ARTICLE VI
Covenants of Buyer& Seller
6.1 Site Development.
6.1.1 As part of Buyer's development of the Property for the Intended Use it shall
complete: (i)site work and road construction necessary to provide direct vehicular access from Waterstone
Drive to and from the Property to include the median cut in Waterstone Drive to allow a full access
intersection from the east or the west and extending the roadway to the northern border of the Roger Dale
Stephens lot and making a payment in lieu, as required by the Town of Hillsborough for the approval of
Buyer's site plan ("Site Plan") in the amount of one-half(1/2) the costs of the future construction of the
roadway from the northern border of the Roger Dale Stephens lot to the northern edge of the right-of-way
of Worth Street not to exceed Thirty-Five Thousand Dollars ($35,000.00) as generally shown on Exhibit
A with the amount of the payment in lieu established and agreed upon prior to the end of the Inspection
Period; (ii)the connection of water and sewer services; and(iii) all storm water control facilities required
by the Town of Hillsborough for Buyer's development include the required detention/ retention facility
shown on Exhibit A being sized to accommodate the impervious surface generated on the Seller's lot to
the north of the Buyer's lot. Seller shall be responsible for all storm water piping to convey the stormwater
from the Seller's lot to the pond shown on Exhibit A, and Buyer shall agree to provide the necessary
easement to accomplish the installation of the necessary pipes. The calculated impervious surface on the
Seller's lot and the location of the necessary easements will be agreed upon prior to the end of the Inspection
Period as provided in Section 6.1.2 and Section 6.3. All site development work for Buyer's development
will comply with the Town of Hillsborough Standards and shall be inspected, approved by the Town of
Hillsborough, and accepted into the perpetual maintenance program of the Town of Hillsborough as
applicable.
6.1.2 On or before 14 days prior to the end of the Inspection Period,Buyer will provide
Seller a copy of its preliminary Site Plan for review and approval. Seller shall have seven (7) days to
review,approve,and otherwise provide comments on the preliminary Site Plan after it is submitted to Seller
for review (the "Plan Approval Period"). Seller's approval of the Site Plan shall not be unreasonably
withheld,conditioned or delayed.If Seller fails to approve or provide comments on the Site Plan within the
Plan Approval Period,it shall be deemed to have been approved by Seller. If Buyer revises the preliminary
Site Plan based on Seller's comments, it shall resubmit the preliminary Site Plan to Seller and the Plan
Approval Period shall restart. In addition, Buyer shall resubmit the Site Plan to Seller for further review if
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there are material changes to the location of buildings, roadways, utilities, or required property area
requested or required by the Town of Hillsborough and the Plan Approval Period shall restart.If Seller does
not finally and unconditionally approve the Site Plan prior to Closing, then Buyer may, by giving written
notice to Seller,terminate this Contract,receive a refund of the Earnest Money and all Extension Deposits.
6.2 Declaration. During the Inspection Period, Buyer and Seller shall negotiate and
otherwise agree upon the form, substance,and other terms of a declaration(i)restricting Seller's remaining
property adjacent to the Property in perpetuity for certain uses that are incompatible with Buyer's Intended
Use, (ii)providing for future maintenance of landscaping on the respective properties, and (iii) allocating
responsibility for future storm water facility maintenance,and(iv)including other terms for the benefit and
future operation of the respective properties as Buyer and Seller may mutually agree("Declaration").Seller
shall provide Buyer a draft of the Declaration no later than fourteen(14)business days prior to the expiration
of the Inspection Period ("Declaration Delivery Date"). If Seller does not deliver the Declaration on or
before the Declaration Delivery Date, then the Inspection Period shall be extended on a day-for-day basis
until the Declaration is delivered to Buyer.The Declaration shall be recorded by Seller in the Orange County
Registry on or prior to Closing.
6.3 Easements. During the Inspection Period, Buyer and Seller shall negotiate and
otherwise agree upon the form, substance, and other terms of all necessary cross-access, utility, and other
easements necessary for Buyer's development and Seller's development of its remaining property adjacent
to the Property(collectively the"Easements"). Seller shall provide Buyer a draft of the Easements no later
than fourteen (14) business days prior to the expiration of the Inspection Period ("Easement Delivery
Date"). If Seller does not deliver the Easements on or before the Easement Delivery Date, then the
Inspection Period shall be extended on a day-for-day basis until the Easements are delivered to Buyer. The
Easements shall be recorded by Seller in the Orange County Registry on or prior to Closing.
6.4 Subdivision Plat. During the Inspection Period,Buyer and Seller shall negotiate and
otherwise agree upon the form and substance of the Subdivision Plat. Seller shall deliver the Subdivision
Plat of the Land to Buyer for review and comment no later than fourteen (14) business days prior to the
expiration of the Inspection Period ("Subdivision Plat Delivery Date"). If Seller does not deliver the
Subdivision Plat on or before the Subdivision Plat Delivery Date, then the Inspection Period shall be
extended on a day-for-day basis until the Subdivision Plat is delivered to Buyer.
6.5 Property Information. No later than five (5)business days following the Effective Date,
Seller shall provide to Buyer for its review,all information and documentation regarding the Property which
is in the possession or control of Seller, its affiliates, and/or property manager("Property Documents").
6.6 Seller Cooperation. Seller agrees that it shall cooperate with all of Buyer's efforts to
entitle the Property for its Intended Use. Seller agrees to sign all applications, submittals, requests, legal
documents, etc. in connection with Buyer's efforts to entitle the Property which may be required. Seller
also agrees to support Buyer's development of the Property for the Intended Use and not to make any public
comments in opposition to Buyer's efforts to entitle the Property for its Intended Use.
ARTICLE VII
Closing
7.1 Proceedings at Closing. On the Closing Date,the Closing shall take place as follows:
7.1.1 Seller shall deliver to Buyer the following documents and instruments,in form and
content reasonably satisfactory to Buyer,duly executed by Seller:
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(a) a General Warranty Deed conveying the Property subject to the Permitted
Exceptions with a legal description that matches the description of the Land as shown on the Subdivision
Plat("Deed");
(b) A copy of the Subdivision Plat that has been recorded in the Orange
County Registry (or a fully executed original recordable version of the Subdivision Plat that has been
approved by all applicable governmental agencies if the Subdivision Plat is to be recorded at Closing);
(c) A copy of the Declaration that has been recorded in the Orange County
Registry(or a fully executed original Declaration executed by Seller if the Declaration is to be recorded at
Closing);
(d) A copy of the Easements that have been recorded in the Orange County
Registry(or a fully executed original Easements executed by Seller if the Easements are to be recorded at
Closing);
(e) a Seller's affidavit and indemnity agreement permitting the Title Company
to insure title to the Property without exception for contractor's and materialmen's liens on the Property,
parties in possession of the Property, any broker's lien on the Property, any discrepancy in the electronic
court records due to computer data migration to the E-Courts Odyssey System, all in a form acceptable to
Buyer and the Title Company;
(f) a Certificate and Affidavit of Non-Foreign Status;
(g) a completed Form 1099-5;
(h) an executed certificate stating that all of Seller's representations and
warranties contained in this Contract are true and correct as of the Closing Date;
(i) a Closing Statement to be prepared by Buyer;
0) certificates and resolutions satisfactory to Buyer and the Title Company
that Seller has taken all necessary company action and has the power and authority to enter into this Contract
and to perform Seller's obligations under this Contract; and
(k) any other documents reasonably requested by Buyer or the Title Company.
7.1.2 Buyer shall deliver to Seller the following documents, in form and content
reasonably satisfactory to Seller, duly executed by Buyer:
(a) Counterpart signature pages on the Declaration(if applicable);
(b) Counterpart signature pages on the Easements (if applicable); and
(c) the Closing Statement.
7.1.3 Buyer shall pay the Purchase Price, after crediting the Earnest Money and any
Extension Deposits and making the adjustments provided for in this Contract,to Seller.
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7.2 Prorations and Adjustments to the Purchase Price.
7.2.1 Buyer and Seller shall make the following adjustments to the Purchase Price as of
11:59 p.m. on the day prior to Closing, such that the day of Closing is a day of income and expense for
Buyer:
(a) Taxes and Assessments. Ad valorem taxes ("Taxes") applicable to the
Property for the calendar year of Closing will be prorated on a day-for day basis as of the Closing Date.
Notwithstanding the foregoing,Buyer may elect to"gross up"the Purchase Price at closing to account for
the Taxes it would be required to pay pursuant to this Section 7.21(a)rather than prorating Taxes at Closing,
in which case Seller will be responsible for payment of all Taxes due at the Closing. Seller shall pay all
assessments levied against the Property that are due and payable on the Closing Date along with its pro rata
share of any assessments that are due and payable after the Closing Date.
(b) Other Items. Any other items which are customarily prorated in
connection with the purchase and sale of properties similar to the Property shall be prorated at Closing.
7.2.2 Except as expressly provided in this Contract,Buyer shall not assume any liability
or obligation of Seller, and Seller shall pay and perform those liabilities and obligations not assumed.
7.3 Costs of Closing. Seller shall pay all transfer taxes and fees payable on the transfer of the
Property, any prepayment penalties on the payoff of any existing mortgage or deed of trust, all recording
costs and other costs relating to any title clearance matters, Seller's attorneys' fees, 'h of any fees charged
by Escrow Agent, and any other costs necessary for Seller to perform it obligations under this Contract.
Buyer shall pay all costs and expenses for the title examination and obtaining the Title Commitment, the
premium for the title policy issued in favor of Buyer, all costs and expenses for the Subdivision Plat
recording fee, all fees to record the Deed, '/2 of any fees charged by Escrow Agent, and Buyer's attorneys'
fees.
7.4 Conditions Precedent to Buyer's Obligation to Close. Buyers' obligations to
consummate the transactions contemplated by this Agreement shall be subject to the satisfaction or waiver,
on or before Closing, of each of the following conditions, all or any of which may be waived, in whole or
in part,at Buyers' sole discretion for purposes of consummating such transactions.In the event any of these
conditions is not satisfied prior to Closing, Buyers shall have the option of terminating this Agreement as
provide herein:
(a) Representations True at Closing. The representations and warranties made by the
Seller in this Agreement, shall be true and correct in all material respects at Closing with the same force
and effect as though such representations and warranties had been made on and as of such date, except for
those representations and warranties that address matters only as of a specified date,which shall be true
and correct in all respects as of that specified date). If Seller is in breach of any of the representations and
warranties then the breach shall be a material default by Seller, and Buyer may exercise Buyer's rights
under Section 8.2 of this Contract.
(c) Covenants of Seller. The Seller shall have duly performed in all material respects
all of the covenants, acts and undertakings to be performed by them pursuant to this Agreement on or
prior to Closing. If Seller fails to so perform,then that failure shall constitute a material default by Seller,
and Buyer may exercise Buyer's rights under Section 8.2 of this Contract.
(d) Subdivision Plat Recorded. Seller shall cause the Subdivision Plat to be recorded
at or prior to Closing. It is understood and agreed that the review, execution, and approval of the
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Subdivision Plat may be delayed by a governmental agency through no fault of Buyer or Seller. Any such
delay shall not be a breach or default of this Agreement, and the Closing shall be extended, if necessary,
to account for delays outside the control of Buyer or Seller related to the review, execution, and recording
of the Subdivision Plat by a Governmental Agency. If Seller fails to record the Subdivision Plat after all
governmental agencies have reviewed and approved it,or if Seller fails to submit the Subdivision Plat for
review and approval by all necessary governmental agencies on or before the Closing Date,then those
failures shall constitute a material default by Seller, and Buyer may exercise Buyer's rights under
Section 8.2 of this Contract.
(e) Declaration and Easements Recorded. Seller shall cause the Declaration and
Easements to be recorded at or prior to Closing. If Seller fails to record the Declaration,then that failure
shall constitute a material default by Seller, and Buyer may exercise Buyer's rights under Section 8.2 of
this Contract.
(f) Board Approval. The Orange County Board of Commissioners shall have
approved the purchase of the Property and otherwise allocated sufficient funds in its annual budget to
complete the Closing,provided however,the Earnest Money and all Extension Deposits will be fully at
risk(except in the event of a Seller default) following the expiration of the Inspection Period if Buyer
does not complete the Closing pursuant to this Section 7.4(f).
In the event any of the above contingencies are not satisfied prior to Closing,this
Agreement, and the parties' obligations under this Agreement, at the sole option of Buyer,will be
cancelled and of no force and effect. Buyer and Seller will utilize their commercially reasonable best
efforts to satisfy all of the sale contingencies and close the transactions governed by this Contract as
expeditiously as possible.
ARTICLE VIII
Default/Remedies
8.1 Buyer's Default. If, after the end of the Inspection Period, Buyer fails to perform any of
its obligations under this Contract,then Seller shall notify Buyer of such default. If Buyer fails to cure that
default within ten(10)days after receipt of that notice, then Seller may, as its sole and exclusive remedy,
terminate this Contract by giving notice to Buyer in which event the Earnest Money shall be delivered to
Seller as full liquidated damages and all rights and obligations of Seller and Buyer under this Contract shall
terminate (other than those that expressly survive termination of this Contract). Buyer and Seller have
agreed that the Earnest Money is a reasonable estimate of the damages that would be suffered by Seller and
that any other measure of damages is speculative and uncertain.
8.2 Seller's Default. If Seller fails to perform any of its obligations under this Contract or if
Seller breaches any representation or warranty under this Contract, then Buyer may notify Seller of such
default. If Seller fails to cure that default within ten (10) days after receipt of that notice (except that if
Seller's default is the failure to close on the sale of the Property on the Closing Date,then Seller shall have
no cure period for such default),then Buyer may as its sole remedies hereunder elect one of the following:
(a)terminate this Contract, receive a refund of the Earnest Money and all Extension Deposits, and receive
payment from Seller for all costs and expenses incurred by Buyer in connection with the purchase of the
Property, including its reasonable attorneys' fees; (b)obtain specific performance of any provision of this
Contract and Seller shall indemnify Buyer for all costs and expenses, including Buyer's reasonable
attorneys' fees, related to any action that is necessary to obtain specific performance; or (c)proceed to
Closing without waiving that failure or breach.
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ARTICLE IX
Risk of Loss and Condemnation
9.1 Risk of Loss and Insurance. Between the Effective Date and Closing, the risks and
obligations of ownership and loss of the Property belong to Seller. If any portion of the Property is damaged
or destroyed prior to Closing,then Seller shall promptly notify Buyer and Buyer may terminate this Contract
by giving notice to Seller prior to Closing, in which event the Earnest Money shall be refunded to Buyer
immediately upon request and all rights and obligations of Seller and Buyer under this Contract shall
terminate (other than those that expressly survive termination of this Contract). If Buyer does not so
terminate this Contract, then the Purchase Price shall be reduced by the total of any insurance proceeds
received by Seller prior to Closing by reason of the damage or destruction and by the amount of any
deductible applicable to the insurance policy, and, at Closing, Seller shall assign to Buyer all insurance
proceeds payable after Closing by reason of the damage or destruction.
9.2 Condemnation. If all or any part of the Property is taken by eminent domain proceedings,
or if eminent domain proceedings are commenced or threatened, then Seller shall promptly notify Buyer,
and Buyer may terminate this Contract by giving notice to Seller prior to Closing,in which event the Earnest
Money shall be refunded to Buyer immediately upon request and all rights and obligations of Seller and
Buyer under this Contract shall terminate (other than those that expressly survive termination of this
Contract). If Buyer does not so terminate this Contract, then the Purchase Price shall be reduced by the
total of any awards or other proceeds received by Seller prior to Closing with respect to any taking, and, at
Closing, Seller shall assign to Buyer all rights of Seller in any awards payable after Closing by reason of
any taking. Seller shall notify Buyer of eminent domain proceedings within five days after Seller learns of
those proceedings.
ARTICLE X
Brokerage Commission
10.1 Brokerage Commission. Seller and Buyer each represent and warrant to the other that no
broker or real estate agent was involved in this transaction. Seller and Buyer shall each indemnify and hold
harmless the other from and against any and all Losses arising out of any alleged brokerage commission,
fee or other compensation with respect to the Property based upon an agreement alleged to have been made
or other action alleged to have been taken by the indemnifying party. The obligations of the parties under
this Section 10.1 shall survive Closing and the termination of this Contract.
ARTICLE XI
Miscellaneous
11.1 Assignment. This Contract may be assigned by Buyer or Seller, in whole or in part, and
provided,however,no such assignment shall relieve the assigning party of liability for the performance of
its obligations under this Contract.
11.2 Binding Effect. This Contract is binding on and inures to the benefit of Buyer and Seller
and their respective successors and assigns.
11.3 Further Assurances. At Closing, and from time to time thereafter, Seller shall perform
any additional acts, and shall execute and deliver any additional documents, as may reasonably be required
to vest in Buyer full title to the Property and otherwise to effectuate the purchase and sale of the Property
as contemplated by this Contract.
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11.4 Survival. Except as otherwise expressly provided in this Contract, all the provisions of
this Contract shall survive Closing. Except for the provisions of Section 2.3,Article VIII,Article XI and
the indemnification provisions of Section 3.1,Section 8.2 and Section 10.1,none of the provisions of this
Contract shall survive the termination of this Contract.
11.5 Entire Agreement. This Contract contains the entire understanding and agreement
between Buyer and Seller and all prior or contemporaneous oral or written agreements or instruments are
merged herein.
11.6 Amendment. This Contract may not be amended except by an instrument in writing
executed by Seller and Buyer.
11.7 Applicable Law. This Contract is governed by the law of the State of North Carolina.
11.8 Business Days. If any time period or deadline in this Contract falls on a Saturday, Sunday
or federal banking holiday,that time period or deadline shall be extended until the next succeeding business
day.
11.9 Interpretation. Except as otherwise specified in this Contract: (a)"includes" and
"including"mean includes or including by way of illustration and not by way of limitation; (b)references
to Exhibits, Sections or subsections are to those attached to or included in this Contract; (c)the section and
other headings in this Contract are for convenience only and do not limit or expand any provisions of this
Contract; and (d)no interpretive presumption shall be drawn against either party by virtue of its role in
drafting this Contract.
11.10 Severability. If any provision of this Contract is held to be invalid or unenforceable,then
such provision will be fully severable from this Contract;and the remaining provisions of this Contract will
remain in full force and effect and will not be affected thereby. Furthermore, in lieu of such invalid or
unenforceable provision,there shall be added automatically as a part of this Contract a valid and enforceable
provision as similar in terms to such invalid or unenforceable provision as may be reasonably possible.
11.11 Counterparts. If this Contract is executed in counterparts, then all of those counterparts
together constitute one and the same instrument. An executed counterpart delivered by facsimile or e-mail
constitutes an original.
11.12 Notices. Any notice contemplated by this Contract must be in writing, addressed as set
forth in Section 1.1 and shall be either(a)sent by United States Mail,postage prepaid,registered or certified
mail, return receipt requested, in which case the notice will be deemed delivered two business days after
being deposited in the United States mail; (b) sent by overnight delivery using a nationally recognized
overnight courier, in which case the notice shall be deemed delivered one business day after deposit with
the courier; (c) sent by e-mail, in which case the notice shall be deemed delivered upon confirmed
transmission of such notice; provided that no later than three business day after the e-mail is sent, a hard
copy of the e-mail transmission is sent in the manner set forth in (b) or (d) of this Section; or (d) sent by
personal delivery,in which case the notice will be deemed delivered on the date of delivery. Any notice to
Buyer must also be delivered to Buyer's Counsel. Any notice to Seller must also be delivered to Seller's
Counsel, if identified in Section 1.1. Any notice to Buyer must also be delivered to Buyer's Counsel, if
identified in Section 1.1. Buyer's counsel may deliver, on behalf of Buyer, any notice contemplated by
this Contract. Seller's counsel may deliver, on behalf of Seller, any notice contemplated by this Contract.
Either party may change its address by giving the other party five days advance written notice of that
change.
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11.13 1031 Exchange. Either party hereto may structure this transaction as a like kind exchange
pursuant to Section 1031 of the Internal Revenue Code. If a party elects to structure this transaction as a
like kind exchange pursuant to Section 1031, the other party shall cooperate in effecting such exchange.
The 1031 party will make all necessary arrangements for the exchange, pay all costs associated with the
exchange and bear all other expenses and risks necessary to accomplish the exchange. The 1031 party's
exchange shall be accomplished through a qualified intermediary,Escrow Agent,exchange agent or similar
third party. The 1031 party's structuring the acquisition of the Property as an exchange shall not extend or
delay the Closing of the Property.
11.14 Sovereign Immunity.Notwithstanding any other term or provision in the Contract,
nothing herein is intended nor shall be interpreted as waiving any claim or defense based on the principle
of sovereign immunity or other State or federal constitutional provision or principle that otherwise would
be available to the Buyer under Applicable Law.
[SIGNATURE PAGE FOLLOWS]
15
21
Buyer and Seller have executed this Contract as of the Effective Date.
Seller:
CAPKOV VENTURES,INC., a North Carolina
business corporation
Date of Seller's execution:
By:
Name:
Title:
16
22
Buyer and Seller have executed this Contract as of the Effective Date.
Buyer:
ORANGE COUNTY,NORTH CAROLINA
Date of Buyer's execution By:
Name:
Title:
PREAUDIT CERTIFICATE
This instrument has been preaudited in the manner required by the Local Government Budget and Fiscal
Control Act.
Orange County Finance Officer
17
23
INDEX
Exhibit A Land
Exhibit B Escrow Provisions
24
Exhibit A
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25
Exhibit B
ESCROW ADDENDUM
This Escrow Addendum dated (this"Addendum"),is hereby made a part of that certain
Purchase and Sale Contract having an Effective Date of (the "Sales Contract"), by and
between CAPKOV VENTURES, INC. as seller thereunder ("Seller"), and ORANGE COUNTY, NC as
purchaser thereunder ("Purchaser"). Investors Title Insurance Company, a North Carolina corporation
("Escrow Agent"), has executed this Addendum for the sole purpose of consenting to the terms of this
Addendum.
Required SELLER Information: Required PURCHASER Information:
Tax ID: Tax ID:
Mailing address: 258 E. Winmore Avenue, Chapel Mailing address: 300 West Tryon Street,
Hill,North Carolina 27516 Hillsborough,North Carolina 27278
Attn: Eric Chupp Attn: Travis Myren
Telephone: 919.260.7262 Telephone: 919.245.2300
Email: ericbchupp(iDbellsouth.net Email: tmyrenkoran e_ c�ountync.gov
WHEREAS, Seller and Purchaser desire that the closing of the transaction contemplated by the Sales
Contract take place in accordance with the terms and provisions of this Addendum.
WHEREAS, pursuant to Section 2_3 of the Sales Contract, Purchaser and Seller have appointed
Investors Title Insurance Company to hold earnest money in the amount of$25,000.00 (the "Escrowed
Funds"),which sum will be held in accordance with the terms of this Addendum and the Sales Contract.
NOW,THEREFORE,in furtherance of the transaction contemplated by the Sales Contract,and for and
in consideration of $300.00 cash paid in hand to Escrow Agent, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto hereby
covenant and agree as follows:
1. Seller and Purchaser hereby designate, constitute and appoint Investors Title Insurance Company
as Escrow Agent under this Addendum to hold Escrowed Funds, and Escrow Agent accepts such
designation and appointment, and agrees to act in accordance with the terms of this Addendum. It
is hereby expressly understood and agreed that in the event a conflict should arise as between the
terms of this Addendum and those of the Sales Contract,the terms of this Addendum will control.
2. Notwithstanding any provisions regarding interest in the Sales Contract, Purchaser and Seller
hereby request that the Escrowed Funds(select ONE option;if neither is selected,the second option
below will be deemed selected):
® accrue interest to the benefit of Purchaser [insert Purchaser or Seller] (if left blank,
Purchaser will be beneficiary, in accordance with 26 CFR§ 1.46813-7).
❑ do not accrue interest to the benefit of Purchaser/Seller.
3. All checks, money orders, wires or drafts sent to Escrow Agent under this Addendum will be
processed for collection in the normal course of business.Escrow Agent will deposit the Escrowed
Funds in a segregated savings account with a federally-insured banking institution. All funds
26
received by check will be held for a minimum of ten(10)business days prior to disbursement.
4. Upon Escrow Agent's receipt of consistent written instructions from both Seller and Purchaser, or
their respective counsel or brokers,Escrow Agent will disburse the Escrowed Funds in accordance
with such instructions. Such instructions may be given in duplicate counterparts and delivered via
electronic mail.Escrow Agent requests delivery of such instructions at least twenty-four(24)hours
before disbursement is needed. Notwithstanding the foregoing provisions of this Section 4, in the
event that Seller or Purchaser provides Escrow Agent and the other party with a written certification
claiming the Escrowed Funds pursuant to certain provisions of the Sales Contract, Escrow Agent,
at its absolute and sole discretion, may elect to proceed by: (i)notifying Purchaser and Seller that
it intends to disburse the Escrowed Funds in accordance with such request unless the non-
requesting party delivers a written objection to such requested disbursement within ten (10)
business days after receipt of said notice, and (ii) so disbursing the Escrowed Funds to the
requesting party after such ten(10)business day period,provided the non-requesting party has not
objected to such disbursement in accordance with this Section.Upon such a disbursement,Escrow
Agent will be released and discharged from any further duty or obligation hereunder.
5. Escrow Agent will be entitled to rely upon the instructions and other matters covered thereby, and
will not be required to investigate the authority of the person executing and delivering such
instructions, or otherwise verify the accuracy of the statements or information presented therein.
6. Escrow Agent will not be accountable for any incidental benefit,which may be attributable to the
Escrowed Funds.Escrow Agent will not owe a fiduciary responsibility to Purchaser and Seller,and
will be a stakeholder only and not liable for any losses,costs or damages it may incur in performing
its responsibilities hereunder unless such losses,costs or damages arise out of the willful default or
gross negligence of Escrow Agent or its agents. Furthermore, and in no way limiting the forgoing
sentence,Escrow Agent will not be liable for any loss or damage resulting from the following:
a. Any default, error, action, or omission of any other party;
b. The expiration of any time limit unless such time limit was known to Escrow Agent and
such loss is solely caused by failure of Escrow Agent to proceed in its ordinary course of
business;
c. Any loss or impairment of funds while on deposit with a federally-insured bank,resulting
from failure, insolvency or suspension of such bank; and
d. Escrow Agent's compliance with any and all legal process, writs, orders,judgments, and
decrees of any court, whether issued with or without jurisdiction and whether or not
subsequently vacated,modified, set aside or reversed.
7. In the event of a dispute hereunder between Seller and Purchaser(or their successors or assigns),
Escrow Agent will have the right, exercisable in its sole discretion, to resign by giving written
notice to Seller and Purchaser, specifying a date on which such resignation will take effect, which
will be no earlier than ten(10)business days after the delivery of such notice.Promptly upon receipt
of such notice, Seller and Purchaser will appoint a mutually acceptable successor escrow agent.
Upon delivery by the successor escrow agent to Seller, Purchaser, and Escrow Agent of a written
instrument accepting such appointment, the successor escrow agent will succeed to all the rights
and duties of Escrow Agent hereunder. If a successor escrow agent is not appointed by the
expiration of such ten(10)business day period,Escrow Agent will have the right,exercisable in its
sole discretion,to be discharged by tendering unto the registry or custody of any court of competent
jurisdiction the Escrowed Funds,together with any such legal pleadings as it deems appropriate.In
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such an event,Escrow Agent will have the right to charge an administrative fee of$500.00 toward
its costs,which will be in addition to any Escrow Agent fee charged. At Escrow Agent's discretion,
all applicable fees charged by Escrow Agent may be withheld from the Escrowed Funds tendered
to the court. Purchaser and Seller will indemnify and hold harmless Escrow Agent for all of its
expenses,costs and reasonable attorneys'fees incurred in connection with such interpleader action
in excess of$500.00. Escrow Agent will have the right to deduct its unpaid fee and any costs it has
incurred for overnight delivery charges or wire transfer fees from the Escrowed Funds prior to
disbursement.
8. The terms and provisions of this Addendum are for the benefit of Seller, Purchaser, and Escrow
Agent and their respective successors and assigns only. Nothing contained herein will be deemed
or construed to inure to the benefit of any other person or party,it being the express intent of Seller,
Purchaser, and Escrow Agent that no such person or parry will be entitled to any of the benefits
hereunder, except as expressly provided herein.
9. This Addendum is intended as a contract under the laws of the State of North Carolina and will be
governed thereby and construed in accordance therewith.
10. This Addendum may be executed by electronic signatures, which for all purposes will be deemed
to constitute originals. This Addendum may be executed in counterparts, all of which when taken
together will be deemed one original.
IN WITNESS WHEREOF, the parties hereto have executed this Addendum as of the day, month
and year first above written.
SELLER: PURCHASER:
Capkov Ventures,Inc. Orange County,North Carolina
By: By:
Name: Name:
Title: Title:
ESCROW AGENT:
Investors Title Insurance Company,
a North Carolina corporation
By:
Name:
Title: