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HomeMy WebLinkAboutpitco.ost.crystalislandranch.signedcontract " . CONTRACT FOR BARGAIN SALE OF CONSERVA TION EASEMENT (Crystal Island Ranch - Pitkin County) /-- r--tAitU"' ",.o"'#-' THIS ~~NTRACT F?R BA~G!!N SALE OF CqpSERVA TION EASEMENT (the "Agreement) IS entered mto thIS r'JIay of JMuary, 2005, by and between RICHARD JELINEK, DEBBIE JELINEK, LLC, and CIR Ranch 1-5, LLC, inclusive, Colorado Limitied Liability Companies (facsimile number: 970- ) (collectively the "Seller") and the BOARD OF COUNTY COMMISSIONERS OF PITKIN COUNTY, COLORADO (facsimile number: 970-920-5198) (the "Purchaser"). The following exhibits are attached to this Agreement: Exhibit A - Exhibit B - Exhibit C - Exhibit D - Exhibit E - Exhibit F - Exhibit G - Description of Property Map of Property Description of Exchange Parcel Map of Exchange Parcel Certificate of Non-Foreign Status Map ofTCF Property Map of A VLT Property RECITALS: A. Richard Jelinek is the principal owner of Crystal Island Ranch ("CIR"), manager and sole member ofCIR Ranches 1-5, LLC and desires to convey a conservation easement on 535 acres of the CIR, and Debbie Jelinek is the owner of an additional separate 17 acres ofCIR known as "Duck Meadows," and she desires to place a conservation easement thereon, with the result being a 552 acre conservation easement ("Conservation Easement"), which 552 acres are described on the attached Exhibit "A", and shown on the attached Exhibit "B" (the "Land"); B. The Aspen Valley Land Trust ("A VL T") holds conservation easements on an additional separate 434 acres of the CIR ("A VL T property") and both CIR and A VL T are willing to allow A VL T to convey a part interest therein to Purchaser. C. The Conservation Fund .("TCF') is the' owner of approximately 90 acres adjacent CIR which Seller desires to acquire in fee simple subject to a conservation easement that prohibits all development but allows continued agricultural and recreational use, including trails and access easements to accomplish such recreational use; such conservation easement will be jointly held by the Purchaser and A VLT, and subject to a public trail easement held by the Purchaser that runs from the northern to the southern boundary along the Crystal River. (The fee title ofthe 90 acres, as subject to the conservation and trail easements noted herein, shall henceforth be referred to as the "TCF property.") n:\wordata \formContract 8/27/03 1 D. Richard and Debbie Jelinek have agreed to exchange the Conservation Easement for $1,000,000 in cash plus the TCF Property (restricted by the conservation easement and trail easement, as noted above). The $1,000,000 and TCF property, taken together, shall be referred to hereinafter as "The Consideration." E. Purchaser agrees that the Seller may claim a bargain sale charitable contribution for the amount by which the fair market value of the Conservation Easement exceeds The Consideration, and Purchaser agrees to cooperate with the Seller in the processing of related tax forms. F. The result of all the transactions contemplated under this and other agreements, as further described in the contingencies below, will be that Purchaser and A VLT will jointly hold conservation easements on the CIR that encompass approximately 1076 acres. AGREEMENT: 1. PROPERTY. Seller agrees to sell and Purchaser agrees to buy, on the terms and conditions set forth in this Agreement, a Conservation Easement encumbering that parcel ofland containing 552 acres more or less, located in Pitkin County Colorado, as described on Exhibit "A" and shown on Exhibit "B", attached hereto, including, without limitation, encumbering as well any and all surface and subsurface water, well, spring, irrigation, subirrigation or ditch rights of any type, including all shares or certificates of any type in ditch or water delivery companies or associations, incidents and appurtenances belonging thereto (collectively, with the "Land", referred to as the "Property"). The final terms of the Conservation Easement (the "Conservation Easement") shall be agreed upon bv the parties during the Inspection Period. Seller intends to make a donation to Purchaser and the Aspen Valley Land Trust, organizations described in Section 50l(c)(3) ofthe Internal Revenue Code, of the amount, if any, by which the fair market value of the Conservation Easement exceeds The Consideration received. 2. PURCHASE PRICE. The Consideration for the Conservation Easement shall be (a) One Million and no/lOOs Dollars ($1,000,000.00) in cash, and (b) the conveyance ofthe TCF Property to Seller, subject to the conservation and trail easements (the "Purchase Price"). Purchaser acknowledges that it is Seller's intention to effectuate a "bargain sale" ofthe Conservation Easement, i.e., a sale to a charitable organization at a price below fair market value wherein the difference is considered a charitable contribution under applicable sections of the Internal Revenue Code. Seller acknowledges that the substantiation of a charitable contribution deduction rests exclusively with Seller except for Purchaser's execution of Internal Revenue Service Form 8283. The $1,000,000 cash portion of the Consideration shall be paid by Purchaser to Seller as follows: 2.1. Closing funds. At closing, the Purchase Price in cash, certified funds, or by wire transfer of federal or other immediately available funds. n:\wordata \formContract 8/27103 2 3. CLOSING DATE. The closing of the transaction contemplated hereunder (the "Closing") shall be held at the office of Pitkin County Title Company, Inc., on or before fifteen (15) days after expiration of the Inspection Period, as defined in paragraph 5, herein (the "Closing Date"). 4. SATISFACTORY INSPECTION AND REVIEW. The Seller and Purchaser expressly covenant and agree that Purchaser's satisfaction, in its sole discretion, upon the review and inspection provided for herein is a specific condition precedent to the obligation of Purchaser to purchase the Conservation Easement. Purchaser shall have a period in which to review the documents, and to make the inspections described below. The period of inspection (the "Inspection Period"), unless extended as provided in paragraph 5.1, shall terminate on the earlier of: (i) Receipt by Seller of notice from Purchaser that the Property is suitable for purchase; or (ii) sixty (60) days after the Effective Date of this Contract, as defined herein. 4.1. Documents. Not later than fifteen (15) days after the Effective Date, Seller shall provide, at Seller's expense, to Purchaser: a Title Commitment issued by Pitkin County Title, Inc., together with legible copies ofthe deed or deeds by which the Seller holds title to the Property, legible copies of any instruments listed in the legal description for the Property, and legible copies of all exceptions to title, pursuant to which the Title Company shall issue to Purchaser a standard coverage owner's policy oftitle insurance, including "gap" and mechanic's lien coverage, insuring title and access to the Conservation Easement as ofthe date of Closing in the amount ofthe Purchase Price; (b) a Certificate of Taxes Due evidencing that all taxes owing on the Property have been paid in full; (c) a copy ofthe current and previous year's Notice of Assessment, or other satisfactory evidence of the current and previous year's assessed value and assessment category for the Property; and (d) to the extent in Seller's possession, copies of any surveys or maps of the Land, plans relating to the building improvements, and studies and reports regarding the soils or water on or under the Land. 4.2. Due Diligence: Inspection; Right of Entrv. Purchaser shall have the right to enter upon the Property at reasonable times for surveying, inspection, and other reasonable purposes related to the transaction contemplated hereunder. Purchaser hereby indemnifies and holds harmless Seller from and against any and all claims, liens, damages, losses, and causes of action which may be asserted by Purchaser or Purchaser's employees, agents, or any third party who enters upon the Property or conducts tests related to the Property at the request of or on behalf of Purchaser or its agents, provided that such indemnification and hold harmless shall not apply to claims arising out of the willful or wanton conduct of Seller. 4.3. Conditions Precedent to Buver's Obligations. Prior to the expiration ofthe Inspection Period the Purchaser shall be satisfied, in its sole discretion, as n :\wordata\fonnContract 8/27103 3 to the condition of title, the condition of the Property, the suitability ofthe Property for encumbrance by the Conservation Easement. 5. ELECTION AT THE END OF THE INSPECTION PERIOD. During the Inspection Period, Purchaser may make the above-described inspections, applications, reviews, studies, evaluations or surveys required to satisfy itself as to the acceptability and suitability of the Conservation Easement for purchase. Should, for any reason, either party not be satisfied that the Conservation Easement is acceptable, such party shall notify the other party in writing on or before the expiration ofthe Inspection Period of its dissatisfaction, at which time this Agreement shall be terminated and of no further force and effect (except that the indemnification described in paragraph 5.2 shall not be terminated) and the Deposit shall be promptly returned to Purchaser (or any portion thereof held by escrow agent); provided, however, if the objections of Purchaser are to title or other defects which Seller can reasonably cure within a twenty (20) day period following the receipt of notice from Purchaser, Seller shall have such period to cure such defects to the reasonable satisfaction of Purchaser. Purchaser shall, at any time, have the right to waive the conditions precedent to its performance under this Agreement before the end ofthe Inspection Period and if Purchaser elects to waive the conditions precedent to its performance and to terminate the Inspection Period, this Agreement will remain in full force and effect and the Deposit shall become non-refundable except as otherwise provided herein. Failure of Purchaser to notify Seller of its dissatisfaction prior to the expiration of the Inspection Period (or an extended Inspection Period) shall be deemed a waiver of this condition precedent and acceptance ofthe Property as suitable for purchase, as required above. Upon termination of the Agreement, Purchaser agrees to return to Seller all data previously delivered to Purchaser under the terms of this Agreement. 6. CLOSING DOCUMENTS. At Closing, Seller shall execute and deliver to Purchaser or its assigns the Conservation Easement, conveying a conservation easement interest in the Property, including access for the purposes described in the conservation easement, free and clear of all liens, encumbrances and other exceptions, except such easements, restrictions and other exceptions as are of record and are approved by Purchaser during the Inspection Period. 7. CONDITION OF THE PROPERTY, REPRESENTATIONS. As of the date of this Agreement and the date of Closing, Seller warrants and represents the following: 7.1. Seller is the record owner of the Property to be encumbered by the Conservation Easement hereunder. Upon the Closing Date, Purchaser will have good and marketable title to the Conservation Easement. . ; n:\wordata\formContract 8/27/03 4 7.2. There are no actions, suits, proceedings or investigations pending or, to Seller's knowledge threatened, against or affecting the Property, or arising out of Seller's conduct on the Property. 7.3. To Seller's best knowledge, Seller is in substantial compliance with the laws, orders, and regulations of each governmental department, commission, board, or agency having jurisdiction over the Property in those cases where noncompliance would have a material adverse effect on the Property. 7.4. Other than this Agreement, Seller is not party to nor subject to or bound by any agreement, contract or lease of any kind relating to the Property. There are no rights of possession to the Property or options or rights of first refusal in third parties, nor rights of access across the Property by third parties. 7.5. The Property, to the best of Seller's knowledge, is not in violation of any federal, state or local law, ordinance or regulation relating to environmental conditions on, under or about the Property, including, but not limited to, soil and groundwater conditions. Neither Seller, nor to the best of Seller's knowledge any third party, has used, generated, manufactured, refined, produced, processed, stored or disposed of on, or under the Property or transported to or from the Property any Hazardous Materials nor does Seller intend to use the Property prior to closing date for the purpose of generating manufacturing, refining, producing, storing, handling, transferring, processing or transporting Hazardous Materials. For the purposes hereof, "Hazardous Materials" does not mean any typical agricultural chemicals such as herbicides and pesticides utilized on properties of this type in Pitkin County, provided that all such chemicals are used in accordance with applicable laws and manufacturer's specifications; but shall mean any flammable explosives, radioactive materials, asbestos, petroleum, organic compounds known as polychlorinated biphenyls, chemicals known to cause cancer or reproductive toxicity, pollutants, contaminants, hazardous wastes, toxic substances or related materials, including, without limitation, any substances defined as or included in the definition of "hazardous substances", "hazardous material" or "toxic substances" in the Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended, 42 U.S.C. Sec. 9601, et seq., the Hazardous Materials Transportation Act, 49 U.S.C. Sec. 1801, et seq., the Resource Conservation and Recovery Act, 42 U.S.c. Sec. 6901 et sea., or any other federal, state or local statute, law, ordinance, code, rule, regulation, order, decree or other requirement of governmental authority regulating, relating to or imposing liability or standard of conduct concerning any hazardous, toxic or dangerous substance or material, as now or at any time hereafter in effect, and in the regulations adopted, published and/or promulgated n :\wordata\formContract 8/27/03 5 pursuant to said laws. To the best of Seller's knowledge there are no underground storage tanks situated in the Property nor to the best of Seller's knowledge have such tanks been previously situated thereon. 7.6. No representation, warranty, or statement made herein by Seller contains any untrue statement of any material fact or omits to state any material fact necessary in order to make such representation, warranty, or statement not misleading. 7.7. Seller is duly authorized and has taken all necessary actions to execute and perform this Agreement and this Agreement is enforceable against Seller in accordance with its terms. 8. CONDITION OF PROPERTY, LIABILITY. Seller has made certain representations and warranties concerning the Property and its condition. During the Inspection Period the Purchaser has the right to inspect the condition ofthe Property. However, without regard to any inspections made by the Purchaser, nothing in this contract shall relieve either party of liability for misrepresentation, breach of warranty or failure to reasonably inspect the condition of the Property. 9. TAXES. Seller shall pay all general taxes and assessments and all sale, excise, transfer and deferred and recapture taxes of any type, for the Property for the current year and all years prior to Closing. Seller shall remain responsible for payment of taxes for the Property, including any taxes or assessments imposed upon or incurred as a result ofthe Conservation Easement. 10. PRESERVATION OF PROPERTY; RISK OF LOSS. Except as otherwise set forth herein, Seller agrees that the Property shall remain as it now is until Closing, and that Seller agrees that it shall neither use nor consent to any use ofthe Property for any purpose or in any manner which would adversely affect Purchaser's intended acquisition of the Conservation Easement as a conservation area or similar use. This covenant expressly precludes any mining of any type on the Property. In the event that Seller shall use or consent to such use ofthe Property, Purchaser may, without liability, refuse to accept the conveyance of the Conservation Easement, in which event the Deposit plus all accrued interest shall be refunded; or alternatively it may elect to accept the conveyance of title to the Conservation Easement with a price adjustment for the change in circumstances. 11. COSTS AND FEES. Closing fees shall be paid by Seller and the Purchaser equally. The premium for the title insurance policy described above shall be paid by Seller. Per page recording costs for the Conservation Easement, shall be paid by Purchaser. Any other recording costs shall be paid by the Seller. Any sales or property transfer tax or fee shall be paid by Seller. The documentary fee shall be paid by the Purchaser. 12. DEFAULT. n:\wordata \formContract 8/27/03 6 12.1. Seller's Remedies. In the event that (a) all of the conditions to this Agreement for the benefit of Purchaser shall have been satisfied, or waived by Purchaser, (b) Seller shall have fully performed or tendered performance of its obligations under this Agreement, and (c) Purchaser shall be unable or shall fail to perform its obligations by the Closing Date, this contract shall become null and void and Seller shall be released from all obligations hereunder as their sole remedy. 12.2. Purchaser's Remedies. If Seller shall fail to consummate the transaction contemplated hereunder for any reason, or if such transaction shall fail to close for any reason other than default by Purchaser, Purchaser may terminate this Agreement and be released from its obligations hereunder, as its sole remedy. 13. NOTICES. All notices required or permitted hereunder will be deemed to have been delivered only upon actual delivery thereof. All notices required or permitted hereunder shall be given by hand delivery, or sent by telecopier, or sent by Federal Express or other courier for delivery at the soonest possible time offered by such courier, directed as follows: Ifto Seller: at the address shown above with a copy to: Leonard M. Oates, Esq. Oates, Knezevich & Gardenswartz, P.C. 533 E. Hopkins Ave. Aspen, CO 81611 If to Purchaser: At the address or fax number shown above 14. MISCELLANEOUS. 14.1. Broker's Commission. Seller and Purchaser each represents to the other that they have not contracted with any broker or finder with regard to this transaction. Each party agrees to indemnify, defend and hold harmless the other from and against any and all liability, claims, demands, damages and costs of any kind arising out of or in connection with any broker's or finder's fee, commission or charges claimed to be due any person in connection with such person's conduct respecting this transaction except as set forth herein. 14.2. Certificate. At or prior to Closing, Seller shall furnish to Purchaser a duly n:\wordata \formContract 8/27103 7 executed Certificate of Non-Foreign Status in the form attached to this Agreement as Exhibit "E". Seller hereby declares and represents to Purchaser that it is not a "foreign person" for purposes of withholding of federal tax as described in such Certificate. 14.3. Assigns. With the prior written approval of the Seller, which shall not be unreasonably withheld, Purchaser may assign this contract and its rights as Purchaser hereunder, in whole or in part, including the Deposit by written assignment wherein the assignee assumes the obligations of Purchaser hereunder. Purchaser may require that the Conservation Easement be directly deeded by the Seller to an entity qualified to hold a conservation easement under the Internal Revenue Code and Colorado law. (?) 14.4. Binding Effect. The terms and conditions ofthis Agreement shall be binding upon and shall inure to the benefit ofthe parties' heirs, executors, administrators, successors and assigns. 14.5. Exhibits. The exhibits hereto constitute an integral part of this Agreement and are hereby incorporated herein. 14.6. Counterparts; Facsimile Signatures. This Agreement may be executed in counterparts, all of which shall constitute one agreement which shall be binding on all of the parties, notwithstanding that all of the parties are not signatories to the original or the same counterpart. Signatures may be evidenced by facsimile transmission and at the request of any party documents with original signatures shall be provided to the other party. 14.7. Severability. If any provision of this Agreement shall be held invalid, the other provisions hereof shall not be affected thereby and shall remain in full force and effect. 14.8. Entire Agreement. This Agreement represents the entire agreement of the parties and may not be amended except by a writing signed by each party thereto. 14.9. Authority. Each party to this Agreement warrants to the other that the respective signatories have full right and authority to enter into and consummate this Agreement and all related documents. 14.10. Merger. The obligations, covenants, representations, warranties and remedies set forth in this Agreement shall not merge with transfer of title but shall remain in effect after the Date of Closing. 14.11. Further Actions. Each party shall execute and deliver or cause to be executed and delivered any and all instruments reasonably required to convey the Property to Purchaser and to vest in each party all rights, interests and benefits intended to be conferred by this Agreement. After Closing Seller may deliver to Purchaser a properly completed Internal Revenue Service Form 8283. Purchaser agrees to execute such Form 8283 and promptly to return it to the Seller. n:\wordata \formContract 8/27/03 8 14.12. Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Colorado. 14.13. Offer. When signed and delivered to the Seller by Purchaser, this Agreement will constitute an offer to the Seller that can be accepted only by the Seller signing and delivering to Purchaser an executed original of this Agreement. Purchaser may withdraw such offer in writing at any time prior to its acceptance. 14.14. Labor and Material. Seller shall deliver to Purchaser at settlement an affidavit, on a form acceptable to Purchaser's lender, if applicable, signed by Seller that no labor or materials have been furnished to the Property within the statutory period for the filing of mechanics' or materialmen's liens against the Property. (?) If labor or materials have been furnished during the statutory period, Seller shall deliver to Purchaser an affidavit signed by Seller and the person or persons furnishing the labor or materials that the costs thereof have been paid. 15. SATURDAYS, SUNDAYS, HOLIDAYS. Ifthe final date of any time period of limitation set out in any provision of this agreement falls on a Saturday, Sunday or a legal holiday under the laws of the State of Colorado, then the time of such period shall be extended to the next day which is not a Saturday, Sunday or legal holiday. 16. CONTINGENCY REGARDING TCF. It is contemplated that both the Seller and the Purchaser will enter into an agreement or separate agreements with TCF to effectuate, respectively, the Seller's acquisition of the TCF property and the Purchaser's acquisition of conservation and trail easements which burden this same land, which is further depicted in Exhibit "F". (Purchaser plans on establishing two trails connecting CIR to the river trail). If either party is unable to reach an acceptable agreement with TCF during the Inspection Period, this Agreement will be rendered null and void, unless the Inspection Period is extended by mutual consent of the parties hereto. Furthermore, the Seller's obligation to transfer the Conservation Easement to Purchaser, and the Purchaser's obligation to make any cash payment, are specifically contingent upon the simultaneous acquisition of respective interests from TCF as noted herein. 17. PURCHASER'S CONTINGENCY; FORMAL COUNTY APPROVAL. The obligations ofthe Purchaser hereunder are specifically contingent upon the valid final adoption by of an Ordinance authorizing the purchase of the Property by the Board of County Commissioners of under terms substantially the same as set forth in this Contract. 18. PURCHASER'S ADDITIONAL CONTINGENCY; A VLT TRANSFER OF JOINT INTEREST. It is contemplated that the Purchaser will enter into a separate agreement with A VL T to obtain a joint interest in the pre-existing conservation easements that burden approximately 434 acres of the CIR, as further depicted in Exhibit "G", which agreement shall also provide that the conservation easements obtained by Purchaser from Seller and TCF will also be n:\wordata\formContract 8/27/03 9 jointly held by Purchaser and A VLT. Purchaser's obligation to consummate the transaction described by this Agreement is specifically contingent upon the simultaneous acquisition of joint interests in the A VL T property as noted herein. 19. APPRAISAL CONTINGENCY. Purchaser shall have the sole option and election to terminate this Agreement ifthe value of The Consideration exceeds the appraised value ofthe Conservation Easement as determined by an appraisal prepared by Hunsperger & Weston, Ltd. and approved by the Purchaser. Purchaser agrees to pay 25% of the appraisal fee, up to a maximum of$6,250. The Seller will pay the balance of the appraisal fee. The Agreement may be terminated by Purchaser giving Seller written notice of termination and a copy of the appraisal, on or before the Inspection Deadline. If Seller does not receive such written notice of termination on or before the Inspection Deadline, Purchaser waives any right to terminate under this subsection. 20. EFFECTIVE DATE. The Effective Date of this Agreement shall be the last date signed by either party. IN WITNESS WHEREOF, the parties hereto have executed this Agreement as ofthe date first above written. SELLER i/;;{ZL ~/ (2~~' Richard C. Jelinek i/ Date: 3/3/0':,'-- I ' Crystal Island Ranch, 1-5, LLC. V'-:;/' (,/"" /' / Byc../ <....... c..-t!!~-..--/ { .~.r'-"'/(. Richard Jelinek, Manag. d Sole Member Date: 'II .- " c? 0 ( ,.;> -~ -> , { By Debbie F. Jelinek, LLC Date: PURCHASER: PITKIN COUNTY, COLORADO, acting by and through its Board of County Commts~ioners (/'I-~/ f)'. .....;f. - i /. : ! /-1 By: ; 'll:1:L . /); ,- vv1i~.u I Patricia K Clapper, ,hair, Boartl 'of County Commissioners Date: tiy-(I- nc;- n:\wordata \formContract 8/27/03 10 EXHIBIT "A" - DESCRIPTION OF PROPERTY A conservation easement over and across the following: n:lwordatalformContract 8/27/03 12 n:lwordatalformContract 8/27/03 EXHIBIT "B" - MAP OF PROPERTY 13 EXHIBIT "E" AFFIDAVIT OF NON-FOREIGN STATUS Section 1445 and Section 6045 of the Internal Revenue Code provide that the Transferee ofa real property interest must withhold tax if the Transferor is a foreign person and must provide certain sales related information to the Intemal Revenue Service. To inform Name of Purchaser here (the "Transferee") that withholding of tax is not required upon its disposition of a U.S. real property interest, more particularly described in the Contract for Sale of Real Estate annexed hereto Name of Seller here (the "Transferor"), hereby certifies that: 1. Transferor is not a non-resident alien for purposes of U.S. income taxation. 2. Transferor's tax identification number is: 3. Transferor's principal business address is: / 4. The gross sales price of this transfer is: $ 5. Transferor understands that this affidavit and information contained herein will be disclosed to the Internal Revenue Service by the Transferee and that any false statement made herein by Transferor could be punished by fine, imprisonment, or both. Under penalties of perjury, Transferor declares that Transferor has examined this certification and, to the best of Transferor's knowledge and belief, it is true, correct and complete. TRANSFEROR: Print Name here Date: STATE OF COUNTY OF ) ) ss: ) SUBSCRIBED, sworn to and acknowledged before me by who acknowledged the foregoing AFFIDAVIT OF NON-FOREIGN STATUS on this day of ,2005. Notary Public My commission expires: n:\wordata lformContract 8/27/03 14