JAMES, DRIGGS, WALCH, SANTORO,
KEARNEY, JOHNSON & THOMPSON
ATTORNEYS
3773 HOWARD HUGHES PARKWAY, SUITE 290N
MARK A. JAMES LAG VEGAS, NEVADA 89109 JAMES E WHITMIRE, III
JOHN E LEACH BRAD" M. BALLARD
GREGORY J. WALD. TEL (702) 791-0308 ELISABETH E WACHSMAN
NICHOLAS J SANTORO FAX (702) 791-1912 L KIRK WILLLIAMS
MICHAEL E. KEARNEY EMAIL [email protected] DEAN 5. BENNETT
J DOUGLAS DRIGGS, JA. MARK 5 KATO
RICHARD F. HOLLEY KIRBY C GRUCHOW, JP
DAY. G JOHNSON JENNIFER LAZOVICH
RONALD J. THOMPSON AND., K ROOM
JOHN E HAN RODNEY 5 WOODBURY
April 26, 2000
Mr. John Keilly
Mr. James Saxton
Re: SAXTON/KEILLY TRANSACTION
Dear Messrs Keilly and Saxton:
This letter memorializes the agreement between James C. Saxton and John Keilly
made on this date.
1. On or before May 12, 2000, Saxton and/or Diamond Key will deliver to
Keilly deeds in-lieu of foreclosure on the Suncliff V and El Mirage projects in
Arizona.
2. On or before April 27, 2000, Saxton will convey to U.S. Mortgage
Corporation the 80 acres known as "Taylor Ranch" at which time all Saxton
guarantees on this project will be released. On or before April 27, 2000, U.S.
Mortgage will retain ownership of North Airport Center, a 26 acre parcel, to
which it currently has title and all Saxton guarantees on this project shall be
released.
3. In exchange for releases of all other Keilly debt (or Keilly
originated debt) on which Saxton or any affiliate is obligated directly or by
virtue of a guarantee relating to matters other than the projects mentioned in
this letter, which releases shall be delivered on or before May 12, 2000,
(except for the open notes for which releases will be given on or before April
27, 2000), on or before April 27, 2000, Saxton will cause Diamond Key to assign
to Keilly or his designee or an entity owned in whole or in part by Keilly, the
agreement and any extension thereto to acquire the property (known as "Gladden
Farms" in Marana, Arizona (the "Gladden Contract"). Such assignments shall be
unconditional.
4. The membership interest in Corte Madera, LLC held by U.S.Mortgage
Corporation will be assigned to Saxton or its designee on or before May 12,
2000, at which time all Saxton related debt in connection with this project will
be released.
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John Keilly
James Saxton
April 26, 2000
Page 2
5. On or before April 28, 2000, Keilly will deliver directly to the
owner of Gladden Farms, on behalf of Gladden Farms, LLC, an entity owned in
whole or in part by Keilly, or any other entity owned in whole or in part by
Keilly, the sum necessary to effect an extension of the Gladden Contract,
pursuant to the Second Addendum to Purchase Agreement, attached hereto, or any
other document necessary to effectuate an extension of the Gladden Contract.
DATED this ______ day of April, 2000. DATED this _____day of April, 2000.
REVIEWED AND APPROVED BY: REVIEWED AND APPROVED BY:
______________________________ ________________________________
JAMES C. SAXTON JOHN KEILLY
SAXTON, INC. DIAMOND KEY HOMES, INC.
BY: __________________________ By: ____________________________
JAMES C. SAXTON, President JAMES C. SAXTON
Chief Executive Officer
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SECOND ADDENDUM TO PURCHASE AGREEMENT
REFERENCE is hereby made to that certain Purchase Agreement previously
entered into between Diamond Key Homes, Inc. as Purchaser and S and R Gladden
Farms, L,L,C, as Seller for the purchase and sale of real property located in
Pima County, Arizona. According to the terms of said Purchase Agreement, closing
was scheduled to occur on January 4, 2000. Thereafter, by addendum dated
December 3, 1999, closing was extended to May 4, 2000.
Purchaser has requested that the scheduled closing date be further extended
until July 31, 2000. To that end, Purchaser and Seller agree as follows:
1. This Second Addendum shall serve as a supplement to the
Purchase Agreement and the Addendum to the Purchase Agreement previously entered
into between Purchaser and Seller and shall not either add to or delete from the
obligations of either party, except as specifically set forth herein.
2. Purchaser agrees to amend the purchase price to the sum of Nine
Million Seven Hundred Four Thousand Eight Hundred Ninety Six Dollars and no/100
($9,704,896.00). Should Purchaser elect to close escrow of the real property
prior to July 31, 2000, the purchase price of the real property only shall be
reduced by the sum of Two Thousand Eight Hundred Twelve Dollars ($2,812.00) per
day for each day the closing occurs earlier than July 31, 2000.
3. Purchaser further agrees to deposit Additional Subsequent
Earnest Money with Escrow Agent in the amount of One Million Dollars
($1,000.000.00) on or before close of business on April 28, 2000. Escrow Agent
is hereby instructed to pay said Additional Subsequent Escrow Money, together
with all accrued interest, directly to Seller upon demand and without recourse
by Purchaser unless Seller defaults in the execution of the closing documents
and delivery of free and clear title. The Additional Subsequent Earnest Money
and any interest thereon shall apply as a credit to the Purchase Price at Close
of Escrow.
4. Seller further agrees to permit the assignment of Purchaser's
interest in the Purchase Agreement to Gladden Farms L.L.C., a Nevada Limited
Liability Company, in accordance with paragraph 23, page 11 of said Purchase
Agreement. Seller and Purchaser agree that Seller's consent is limited to this
assignment only, is granted for the purpose of facilitating the close of the
transaction contemplated by the Purchase Agreement, and is conditioned on the
actual conveyance of title to Gladden Farms, L.L.C. a Nevada Limited Liability
Company. Purchaser and Seller agree that the consent to assignment granted by
Seller is so limited, does not constitute a waiver of Seller's rights under
Paragraph 23 of the Purchase Agreement, is not applicable to any other assignee,
and does not release Purchaser from any other obligations set forth in the
Purchase Agreement or the Addendum to the Purchase Agreement.
5. Purchaser consents to the transfer of escrow for this
transaction from Chicago Title to Title Security, 5255 E Williams Circle, Suite
2045, Tucson, Arizona 85711; fax - (520) 747-1403 due to the relocation of the
escrow agent, Judy Martin Sussalla; however, the title insurance shall be issued
by Chicago Title in accordance with the preliminary title reports previously
issued by it. By signing this Second Addendum to Purchase Agreement, Gladden
Farms, L.L.C., a Nevada Limited Liability Company acknowledges and agrees to the
limited assignment hereby agreed to by Seller and all terms and obligations
previously agreed to by Purchaser and Seller,
6. Saxon Homes, a corporation, by signing this Second Addendum to
the Purchase Agreement releases any and all claims it may have to the property
or this transaction.
7. Purchaser agrees that Seller has made no representations as to
any additional escrow closing extensions of time and waives any claim for
additional time in the event it or its assignee is unable to close escrow on or
before July 31, 2000. Purchaser further confirms that all escrow monies
previously paid , as well as the Additional Subsequent Ernest Money paid
pursuant to this Second Addendum to Purchase Agreement, are without recourse to
Purchaser or its assignee for any reason whatsoever, including planning or
zoning approval, unless Seller fails to execute conveyance of the real property
at escrow closing.
<PAGE>
8. In consideration of the foregoing, Seller agrees that the
current closing date of May 4, 2000 is extended to July 31, 2000.
AGREED TO on the dates set forth opposite the signatures below.
PURCHASER: Diamond Key Homes, Inc.
an Arizona corporation
DATE: _______________ By: _________________________________
Eugene Baker
Its President
Saxton Incorporated
DATE: _______________ By: _________________________________
Jim Saxton
Its CEO
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