HomeMy WebLinkAboutOption Agreement OPTION AGREEMENT
THIS OPTION AGREEMENT is made as of the 20th day of September, 2000, between
CORNELL UNIVERSITY c/o Real Estate Department, Box DH-Real Estate, Ithaca, NY 14850
(hereinafter referred to as " Cornell" ), and TOWN OF ITHACA of 215 North Tioga Street, Ithaca,
New York, (hereinafter called the " Town") ,
Cornell and Town agree as follows :
1 . GRANT OF OPTION. The Town hereby irrevocably grants to the Cornell the exclusive Option
to purchase from Town, on and subject to the terms and conditions hereinafter contained, the
premises hereinafter described .
2 . CONSIDERATION FOR OPTION.
(A) Cornell is delivering to the Town concurrently herewith for deposit with Tompkins
County Trust Company as escrow agent the sum of $ 5 , 000 . 00, in escrow, receipt of which
is acknowledged by Town, subject to collection. Said sum is
(i) To be applied to the purchase price if the option is exercised;
(ii) To be refunded to Cornell if within 30 days of the execution of this
option
(a) Cornell has at its expense been unable to obtain environmental
studies or reviews reasonably satisfactory to Cornell; or
(b) Cornell has been unable to assemble the other parcels needed by
Cornell to proceed with its project;
(iii) To be refunded to Cornell if within 30 days of delivery to Cornell of the
title abstract and proposed deed and survey Cornell finds the title
unacceptable as set forth below and the Town is unwilling to correct
same if the cost of correction exceeds $ 1 , 000 . 00 or if the Town is
unable to correct same; or
(iv) To be refunded to Cornell if the Buildings a Properties Committee of the
Cornell Board of Trustees (the "Committee") does not ratify the
execution of this Option Agreement by October 30, 2000;
(v) To be refunded to Cornell if a resolution authorizing the sale to Cornell
(the "Resolution") is not approved by the Town Board of the Town,
or if so approved is subjected to a permissive referendum and the
Resolution is not approved by the voters.
(vi) Otherwise to be non-refundable.
ATTACHMENT # 4
Cornell Option Agreement; Ithaca General, JCB; September 20, 2000; 9:34 AM,
(B) If the option is extended pursuant to Section 4 (A) below, $ 5 , 000 payable
November 1 , 2000 or earlier upon the approval of this Option Agreement by
the Committee, to be added to the above escrow account and
(i) To be applied to the purchase price if the option is exercised;
(ii) To be refunded to Cornell if the Resolution is not approved by the Town
Board of the Town, or if so approved is subjected to a permissive
referendum and the Resolution is not approved by the voters;
(iii) To be refunded to Cornell if Cornell exercises the option, directs the
Town to demolish the building and deposits the amounts required
pursuant to paragraph 6 below, and the Town is unable to demolish
the building within six months of the date of such direction or any
extended time to which the parties may agree;
(iv) Otherwise to be non-refundable .
(C) If the option is extended in accordance with Section 4 (B) below, $ 10, 000 on
July 1 , 2001 , to be added to the escrow and held in accordance with the same
terms as the $ 5 , 000 . 00 to be paid pursuant to subparagraph (B) above.
3 . TERM OF OPTION. This Option shall continue in effect for a period commencing with the
execution of same by both parties until October 31 , 2000, and may be exercised (in accordance with
its terms) at any time on or before its expiration. The exercise of this Option by the Cornell shall be
by written notice sent or delivered to the Town in the manner hereinafter prescribed.
4 . EXTENSION OF OPTION. The term may be extended by Cornell for the following periods
upon the following payments in addition to the payments set forth in Section 2 above :
(A) From November 1 , 2000, up to June 30, 2001 , upon Cornell ' s payment to the
Town of the sum of $ 1500 per month in advance for each month Cornell
wishes to extend the option commencing November 1 , 2000, through June 1 ,
2001 ;
(B) From July 1 , 2001 up to June 30, 2002, upon Cornell ' s continuing payments of
$ 1500 per month of the further extension, payable in advance commencing
July 1 , 2001 through June 1 , 2002 .
The monthly payments would be non-refundable and would not be applied to the purchase price,
except that if the Town fails to adopt a resolution approving the sale within 30 days of written
request from Cornell to do so (which written request may not be delivered to the Town by Cornell
until the Committee has approved the purchase contemplated by this Option Agreement), or if the
Town adopts the Rresolution and the same is subjected to a permissive referendum and not approved
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Cornell Option Agreement; Ithaca General; JCB; September 20, 2000; 9:34 AM
by the voters within 120 days of the adoption of the Resolution by the Town Board, all of the
monthly payments in excess of $3 , 000 . 00 made after such written request from Cornell shall be
returned to Cornell.
Notwithstanding any other provisions above, this Option may be terminated by Cornell at any time,
and upon such termination no monthly or other payments relating to any period after the date of
termination shall be due. Amounts paid prior to such termination remain the property of the Town
except to the extent expressly refundable under the terms of this Option Agreement.
5 . FAILURE TO EXERCISE OPTION. If prior to the expiration date of the term of this Option,
or any extension, Cornell does not exercise this Option, the Town shall retain absolutely all moneys
paid to the Town for this Option as the consideration for this Option during the period for which the
Option was outstanding, except to the extent the . same are refundable to Cornell as set forth above.
6 . EXERCISE OF OPTION. If this Option is exercised during its term (in accordance with its
terms) the Town shall sell and convey the premises hereinafter described to Cornell, and Cornell shall
purchase and accept said premises from the Town on and subject to the terms and conditions
hereinafter set forth. If this Option is exercised (regardless of when the closing actually occurs)
during the term of this Option, the amount paid upon the execution of this Option shall be credited
to the purchase price to the extent set forth above.
7 . MANNER OF EXERCISE OF OPTION. To exercise this Option Cornell shall send to or deliver
a written notice to the Town exercising the option. The closing pursuant to such exercise shall occur
on the first business day that is following the nineteenth day after such delivery, unless the parties
agree to a different date, or unless the closing is delayed in order to meet the requirements for Town
Board action, possible referendum, and/or demolition (as set forth below) in which event the closing
shall occur on the first business day following the nineteenth day after completion of all of such
requirements, unless the parties agree to a different date. The date of closing is herein referred to the
" Closing Date. " The closing shall thereafter occur in accordance with the provisions hereinafter set
forth.
8 . ASSIGNMENT. This Option may be assigned by the Cornell to such persons or entities as
Cornell may, in its sole discretion, deem appropriate including, without limitation, any limited
partnership or real estate investing group that may be formed for the purposes of taking title to the
property. Upon the assignment of this Option, the assignee shall stand in the stead of the Cornell and
shall have all of the rights and obligations of the Cornell including the right to exercise this Option.
9 . DESCRIPTION OF PROPERTY The property is located in the City of Ithaca, County of
Tompkins, State of New York, consists of a lot and building thereon known generally as 126 East
Seneca Street and is shown as tax parcel No . 61 . - 5 -9 on the Tompkins County Assessment Maps for
the City of Ithaca. The actual conveyance shall be by a survey to be provided by the Town as
hereinafter set forth.
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10. PURCHASE PRICE AND PAYMENT . The purchase price is $315 , 000 . 00 payable in cash or
certified or bank check at closing, less the amounts paid prior to closing pursuant to this Option
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Cornell Option Agreement, Ithaca General; JCB; September 20, 1000, 9:34 AM
Agreement which are by the terms of this Agreement to be applied to the purchase price .
11 . CLOSINGPAPERS TO BE DELIVERED BY TOWN. Ifthis Option is exercised, Town agrees
to furnish tax search, a good and sufficient bargain and sale deed with covenant against grantor' s acts
and abstract, all showing good and marketable title for Cornell as of the date of closing title and
showing said premises to be free and clear of all liens, encumbrances, and assessments except
easements, restrictions, assessments, covenants of record or other title defects which are found
acceptable by Cornell . The abstract of title, survey, and proposed deed shall be submitted to Cornell
or its attorney as soon as possible after the execution of this Option Agreement. Cornell shall have
a period of 30 days from receipt of said documents to review the title and deed and advise if the same
is acceptable. If the deed or title is not acceptable, Cornell shall notify the Town, in which event if
the cost of making the title or deed acceptable is $ 1 , 000 or less, the Town shall take such steps as are
acceptable to Cornell to accomplish same. If title cannot be made acceptable for such cost, unless
Cornell waives such title or other defects within 30 days after Cornell notifies the Town of its title
objections, the Town shall have the option of terminating this option agreement, refunding any
amounts paid by Cornell, and thereafter neither party shall have any obligations hereunder. If title
is found acceptable, or if Cornell waives any title or other defects, Cornell agrees to accept title at
closing provided the it is in the same condition at closing as it was at the time it was found acceptable
or the defects were waived . The Town will have the abstract updated at least 10 days before the
Closing Date. The tax search may be delivered on date of closing. Town further agrees to furnish,
within fifteen days of the execution of this Option Agreement, and updated to a date no later than
fifteen days prior to closing, a survey showing the boundary line of the premises and location of all
improvements thereon certified to Cornell, Cornell's Assignee, and any title insurance company
designated by Cornell or Cornell's assignee.
12 . CLOSING LOCATION. The closing shall occur at the offices of BARNEY, GROSSMAN
DUBOW & MARCUS , 119 East Seneca Street, Ithaca, New York, 14850 .
13 POSSESSION. Possession shall be given on closing . Town agrees to deliver premises vacant
and broom clean unless demolished as otherwise provided herein, in which event the premises will
be delivered vacant and with all material building debris removed .
14 ADJUSTMENTS . Current taxes, interest, insurance, rents, water and public utility charges are
to be adjusted as of closing.
15 . RIGHT OF INSPECTION. Town agrees that Cornell, Cornell's architects,. engineers , and other
professionals shall have the right to inspect the premises at reasonable time upon reasonable prior
arrangements for the purposes of preparing drawings, plans and specifications for any alterations or
demolition considered by Cornell.
16 , PERNIISSIVE REFERENDUM CONTINGENCY. The sale by the Town would be contingent
upon adoption of the Resolution by the Town Board subject to a permissive referendum and either
no referendum being sought within the applicable time periods, or if sought, the Resolution being
approved 'by the electorate. The Town Board would consider the Resolution
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Cornell Option Agreement, Ithaca General; JCB; September 20, 2000; 9:34 AM
(A) Within thirty days after Cornell has exercised its option hereunder; or
(B) If legally permissible, at such earlier date which shall be no later than forty-five
days of receipt by the Town of a written request from Cornell that the Town so act, provided that at
the time of making such request, Cornell consents that, if necessary, the terms of the sale and
prospective purchaser may be made public.
If a referendum is requested, and if the Resolution is not approved by the electorate, the option would
terminate upon the date of the adverse vote and, except as set forth above regarding payments by
Cornell, neither party would have any . further obligations hereunder.
17 . DEMOLITION. At the option of Cornell, if Cornell delivered notice to the Town that Cornell
was exercising the option and paid to the Attorneys for the Town in escrow the estimated cost of
demolition of the building, plus $ 100, 000, the Town would endeavor to arrange for the demolition
of the building within the next 120 days, in which event the Closing Date would be deferred for 120
days, or, if demolition was accomplished earlier, until 20 days following completion ofthe demolition,
If the Town were successful in demolishing the building, the purchase price would be increased by
the amount of the actual demolition costs, with the estimated costs and the $ 100, 000 delivered per
this paragraph being credited to the purchase price. If the Town were not successful in obtaining a
permit for demolishing the building, or was unable to complete the demolition due to circumstances
beyond the Town' s control within the 120 days (or such longer period to which Cornell might
consent) at Cornell ' s election to be exercised by delivery ofwritten notice to the Town within 30 days
of the expiration of such 120 day (or agreed-upon longer period) the option would terminate, and the
estimated costs and $ 100, 000 delivered per this paragraph would be returned to Cornell. If Cornell
did not elect to so terminate, the premises will be conveyed to Cornell inwhatever state or condition
they were in at the end of said 30 day election period . If Cornell defaulted in closing after the
building was timely demolished, the estimated costs and the $ 100, 000 would be forfeited to the Town
as additional consideration for the option and the actions taken by the Town in reliance upon the
presumed exercise of the option by Cornell .
18 . REAL ESTATE COMMISSIONS . The Town agrees to pay any commissions due Robert A.
Mead & Associates, Inc. The Town represents and warrants that it has not engaged any other real
estate agent or broker in connection with the transfer of the property and agrees to indemnify and
hold Cornell harmless from any amounts due and not,paid Robert A. Mead & Associates, Inc. or any
other expenses or costs (including reasonable attorneys fees) Cornell may incur by reason of the
Town' s breach ofthe foregoing representation. Cornell represents that it has not involved any broker
or finder in connection with the purchase other than Llenroc Real Estate, Inc. and agrees to indemnify
and hold harmless the Town for any amounts due and not paid to Llenroc Real Estate, Inc. and for
any costs or expenses the Town suffers by reason of the breach of this representation, including
reasonable attorneys fees .
19. CONFIDENTIALITY. Both parties will use every effort to keep the existence and terms of this
Option Agreement confidential until Cornell has obtained approval ofthe Committee and authorized
disclosure, or until Cornell requests formal submission of the matter for approval to the Town Board
for action subject to permissive referendum, or until Cornell earlier authorizes any disclosure, or until
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Cornell Option Agreement; Ithaca General; JCB; September 20, 2000; 9:34 AM
Cornell itself publicly discloses same, whichever is earliest.
20 . ESCROW AGREEMENT . The funds paid in escrow hereunder shall be held by Tompkins
County Trust Company in accordance with the terms of the Escrow Agreement annexed hereto as
Exhibit A, provided, however, that to the extent there is any conflict between the terms of the Escrow
Agreement and this Option Agreement, including any conflict in the terms relating to payment of
funds, the terms of this Option Agreement shall prevail and govern the transaction.
20 . SUPERSEDING AGREEMENT . This agreement supersedes any and all agreements that may
have been previously made between the parties and states the full agreement of the parties .
21 . BINDING NATURE OF AGREEMENT . This Option Agreement shall be binding upon the
parties hereto and upon their respective heirs, executors, administrators, successors or assigns .
IN WITNESS WHEREOF, the parties hereto have executed this Option Agreement as of the day and
year first above written.
CORNELL UNIVERSITY
Dated : September 20, 2000
By ,
TOWN OF ITHACA
Dated : September 20, 2000
By � 2GJ � Y
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