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The South Adams School Corporation's acceptance of a bid by CDI Development Services in the amount of $747,400 for the purchase of the former elementary school property does not necessarily mean that the agreement is a "done deal."
According to Superintendent Scott Litwiller at Tuesday's board of education meeting, CDI will reach the end of its original 120-day due diligence period on Thursday. Litwiller said he received a letter from CDI Tuesday afternoon stating that CDI has "not received adequate assurances from potential clients, and without such assurance of approval, they cannot complete their due diligence activity to close on the purchase of the property."
Litwiller added, "Their solution to this is to extend the original due diligence period another 60 days, until November 12, without cost to them" through a contract amendment.
The original purchase agreement stated that CDI has the option to extend the due diligence period for up to two periods of 60 days by paying an additional $7,500 into the escrow account for each extension.
CDI stated in its letter to Litwiller that if the school board does not agree to the amendment by Thursday it will "consider the agreement [to purchase the property] terminated."
Litwiller consulted with school board Attorney Tim Baker, who presented three options: 1) agree to the amendment to the purchase agreement as presented by CDI; 2) negotiate a price; or 3) agree to the amendment and then negotiate a price.
After determining that the school corporation would incur no costs as a result of the proposed amendment, Litwiller indicated that he would like to agree to CDI's terms. He said, "We don't have a card to trump it. I think we should let them take this hand."
Board members all agreed to comply with CDI's request to extend the original due diligence period for 60 days at no cost to CDI.
Litwiller noted that a CDI representative said, "It's not totally bleak." Litwiller added, "He's still optimistic." However, "There has been some pushback about the cost of development with the original two strong verbal commitments they had. Also, the restaurant contacts have not made this a priority. They are still interested and have been talking about it, but they haven't actively taken the steps in the direction we thought they would."