DUE DILIGENCE CHECKLIST FOR REAL ESTATE PURCHASE

Disclaimer: This was not prepared for any specific state and should not be relied on by anyone

for any purpose without your own individual research and study. No warranty expressed or

implied.

• Existing title policies.

• Rent Rolls.

• Leases (whether as lessor or lessee), subleases, assignments and other similar real property

instruments relating to Seller.

• Existing surveys.

• Zoning approvals, variances or use permits.

• All notes, mortgages, deeds of trusts and other interests granted to third parties in respect

of real property.

• All easements and rights of way owned or granted by Seller.

• List of personal property included in the sale.

SELLER DOCS/INFO:

• Articles of Incorporation or organization, including all amendments.

• Bylaws or Operating Agreement, including all amendments.

• Schedule of owners.

• Foreign persons – FERPTA.

• Certificates of good standing, evidence of compliance with state franchise, income or

other tax laws in each jurisdiction, evidence of qualification to do business in all

CONTRACTS/AGREEMENTS:

• New construction, improvements, repair and maintenance contracts.

• Employment and consulting agreements and other agreements with other employees.

• Contracts or other agreements between Seller and any officer, director, nominee for

election of director, or family member of the foregoing or any officer, director, nominee

for director or family member who has any interest in any entity with whom Seller has

contracted.

• Service and maintenance agreements.

• Patent and copyright licensing agreements and the like.

Real Estate Broker involvement

• Broker agreement.

• Commission arrangement.

• Is there a co-broker involved?

• Is a commission due regardless of closing?

FINANCIAL INFORMATION:

• Audited financial statements for past four fiscal years, together with Auditors’ Report.

• Unaudited financial statements for period ended.

• Copies of all correspondence, documentation and determination letters, if applicable,

from or with the IRS, state and local taxing authorities.

• Copies of all tax sharing or tax indemnification agreements.

Debt and liabilities.

• All debt instruments, long term or short term, e.g., loan agreements, promissory notes,

mortgages, installment sales contracts, capitalized leases, etc.

• Contingent/unrecorded liabilities.

• Guarantees;

• List of all bank accounts of Sellers, including account numbers and location, current

banking resolutions.

ENVIRONMENTAL CONSIDERATIONS.

• All documents relating to the inspection of Seller’s property for asbestos, PCB's and

other environmental, health or other hazards and the abatement of any such hazards;

including all documents related to any inspection of the water supplies to Seller’s

property or condition of drinking water in Seller’s property.

• All documents relating to the Seller's compliance with, or potential, alleged or actual

• Description of procedures for disposing of active, toxic or other hazardous waste.

• Infectious or hazardous waste disposal agreements.

INSURANCE INFORMATION:

• Schedule of existing coverage including name of insurer, policy expiration date, amount

and type of coverage, deductible and premium amounts.

• Provide copies of all policies or self-insurance agreements.

• List and descriptions of pending or threatened insurance claims.

• List of all current outstanding claims, insurance coverage available and reserves

compensation, unemployment compensation claims, wage and hour complaints),

o identifying opposing parties, nature of claim, counsel for both sides, insurance

coverage status and likely exposure. As to existing litigation, provide identification

of counsel for each party, assessment of status, claim and defense prepared by

Seller’s counsel.

• Schedule of all known contingent liabilities.

• Schedule of all administrative proceedings (whether federal, state or local), pending or

threatened.

REGULATORY (Including copies of all correspondence with governmental agencies in respect

of such licenses or information).

• All business licenses or permits (including without limitation, operationally required

licenses, limited sales tax permits, certificates of occupancy, pollution control permits,

boiler permits, elevator permits, parking structure permits, etc.).

• Building Code compliance.

• All correspondence and filings with federal, state, local and any other regulatory bodies

or agencies.