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EXHIBIT 10.4
LOT SALE AGREEMENT
[Lots 6 and 7]
This Lot Sale Agreement (the "Agreement"), dated as of February 17,
1997 ("Effective Date"), is made between PacTel Systems, a California
corporation ("Seller") and Pacific Gulf Properties, Inc., a California
corporation ("Buyer").
RECITALS
Subject to the terms of this Agreement, Seller wishes to sell, and
Buyer wishes to purchase, the Property defined in section 1.3.
AGREEMENT
NOW, THEREFORE, in consideration of the mutual covenants and conditions
herein and for other good and valuable consideration, the receipt and adequacy
of which are hereby acknowledged, Seller and Buyer agree as follows:
1. PURCHASE AND SALE OF PROPERTY
1.1 Significant Definitions. The terms below are hereby defined as
follows:
"Building Density" for each Lot: Tract-Lot No. Square Footage
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14316-1 (Brochure Lot No. 6) 162,043
14316-6 (Brochure Lot No. 7) 57,673
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219,716
"Closing Date": April 29, 1997, or such other date for the Closing as
may be mutually agreed in writing to by the parties.
"Contingency Date": April 14, 1997.
"FCPP Credits": Foothill Circulation Phasing Program fee credit: Five
Hundred Fifty Four Thousand Eight Hundred Thirty Nine Dollars ($554,839).
"First Deposit": One Hundred Thousand Dollars ($100,000).
"Second Deposit": One Hundred Thousand Dollars ($100,000).
"Lots": Tract 14316 Lot Nos. 1 and 6 in the project commonly known as
Pacific Commercentre, in Lake Forest, California. (Pacific Commercentre
Brochure Lot Nos. 6 and 7)
"Purchase Price": Three Million Four Hundred Ninety Eight Thousand
Three Hundred Four Dollars ($3,498,304).
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"Buyer's Broker": ▇▇▇▇ Commercial Brokerage.
1.2 Purchase and Sale. Upon the terms and subject to the conditions of
this Agreement, Seller shall sell to Buyer, and Buyer shall purchase from
Seller, the Property (as defined in section 1.3) at Closing (as defined in
section 8.2).
1.3 Description of Property. The "Property" shall consist of the
following:
(a) Land and Improvements. Each Lot specifically described in Exhibit A
(the "Land"), and any improvements thereon (the "Improvements").
(b) Appurtenances. The interest of Seller in all rights, privileges and
easements appurtenant to the Land and Improvements, including all minerals,
oil, gas and other hydrocarbon substances on and under the Land, as well as all
development rights, air rights, water, water rights and water stock relating to
the Land and Improvements and any other easements, rights-of-way or
appurtenances used in connection with the beneficial use or enjoyment of the
Land and Improvements and, to the extent that they relate to the Land and
Improvements, all of Seller's rights, easements or other interests, if any, in
and to adjacent streets, alleys and rights-of-way, and water and sewer taps,
sanitary or storm sewer capacity or reservations and rights under utility
agreements with any applicable governmental or quasi-governmental entities or
agencies with respect to the providing of utility services to the Land (the
"Appurtenances"). The Land, Improvements and Appurtenances are collectively
referred to as the "Real Property." The Real Property shall be transferred to
Buyer at Closing (as defined in section 8.2) pursuant to a grant deed in the
form of Exhibit B (the "Grant Deed").
(c) Credits. The FCPP Credits shall be assigned to Buyer.
(d) Pacific Commercentre Agreements. The interest of Seller in the
various agreements listed in Exhibit C with respect to the Property (the
"Property Agreements").
1.4 Intentionally omitted.
1.5 Additional Fee Credits. Total Foothill Circulation Phasing Program
fees payable in connection with the Property based on the Building Density
specified in section 1.1 less the amount of FCPP Credits is the "Excess Fees".
Seller owns credits available ("Credits") to pay such Excess Fees. At the
Closing, if Buyer and Seller mutually agree, Seller shall sell and assign to
Buyer at the Closing such credits in amounts up to the Excess Fees ("Additional
Credits") and Buyer shall pay Seller the amount of such Additional Credits
assigned. If Buyer and Seller so elect, Buyer and Seller shall give Escrow
Holder written notice on or prior to the Closing specifying the Additional
Credits to be assigned for Foothill Circulation Phasing Program fees.
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2. PURCHASE PRICE
2.1 Amount. Buyer shall pay the Purchase Price for the purchase of the
Property, Buyer shall deliver the Purchase Price to Seller through "Escrow" (as
defined in Section 8.1) in immediately available federal funds at Closing, in
accordance with Section 8.4.
2.2 Deposit. Within two (2) Business Days (as defined in Section 11.2)
of the full execution of this Agreement by the parties, Buyer shall deliver
the First Deposit in cash to Fidelity Title Insurance Company ("Escrow
Holder"). Within one Business Day after the Contingency Date, Buyer shall
deliver its Second Deposit in cash to the Escrow Holder. The First Deposit and
the Second Deposit, if applicable, is referred to as the "Deposit". After the
Contingency Date, the Deposit shall become non-refundable and Escrow Holder is
hereby instructed to release the Deposit to Seller immediately and without the
necessity of further instructions.
3. CONDITION OF PROPERTY
3.1 Buyer's Inspection of Property.
(a) Inspection Rights. Subject to the terms and condition of this
Section 3.1, Buyer and Buyer's consultants, agents, engineers, inspectors,
contractors and employees directed by Buyer (collectively, "Buyer's
Representatives") shall have reasonable access to the Property for the purpose
of performing inspections, examinations, tests, analyses, studies, surveys,
evaluations or any other investigations of the Property ("Inspections").
Notwithstanding the foregoing, Buyer shall not make excavations or test
borings, drill ▇▇▇▇▇, disturb any plants, trees or shrubs, or engage in any
other activities in, on or around the Property that damage the Property, absent
specific written consent from Seller, which consent shall not be unreasonably
withheld or delayed. Buyer's right of entry onto the Property shall be for the
limited purpose of performing the Inspections, and Buyer shall have no right to
use the Property for any other purpose until after Closing.
(b) Terms and Conditions. Buyer shall give reasonable advance notice
(which may be written or oral) to Seller before any Inspections, and all
Inspections shall be performed at Buyer's sole cost and expense and subject to
such reasonable conditions as Seller may impose. Buyer shall permit Seller's
consultants, agents, engineers, inspectors, contractors or employees ("Seller's
Representatives") to accompany Buyer and Buyer's Representatives during all
such Inspections. Upon request by Seller and at Seller's cost, Buyer shall
divide and share with Seller all environmental testing samples taken from or
related to the Property for the purpose of performing separate testing. Seller
shall make Seller's Representatives reasonably available to Buyer for such
Inspections on a timely basis. Before any entry into the Property, Buyer shall
obtain and furnish to Seller a certificate of insurance showing that Buyer has
obtained a policy of commercial liability insurance with a combined single
limit coverage of not less than $1 million, naming Buyer as an insured and
Seller as an additional insured, issued by a responsible insurer approved by
Seller and licensed to conduct business in California. Such
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insurance policy shall expressly provide that such insurance may not be canceled
or reduced in scope or coverage without at least thirty (30) days' prior written
notice.
(c) Indemnification. Buyer shall indemnify, defend with counsel of
Seller's choice and hold Seller harmless from all claims (including claims of
lien for work or labor performed or materials or supplies furnished), demands,
liabilities, losses, damages, costs, fees and expenses, including Seller's
reasonable attorneys' fees, costs and expenses, arising out of the acts or
activities of Buyer, Buyer's Representatives in, on or about the Property or
arising in connection with the Inspections performed pursuant to this Section
3.1 or the review of Books and Records (as defined in Section 3.2) pursuant to
Section 3.2, subject, however, to the procedures set forth in Section 9.3.
Without limiting the generality of the foregoing, Buyer shall promptly repair,
at its sole cost and expense, any damage to the Property or the Books and
Records caused by any Inspection, the review of Books and Records or entry in,
on or around the Property, provided, however, Seller shall have the right to
supervise such repair. Buyer's obligations under this Section 3.1(c) shall
survive Closing or the earlier termination of this Agreement.
3.2 Books and Records. Seller shall make available for inspection,
review and copying by Buyer, at Buyer's sole cost and expense, such surveys,
documents, plans, records, files and other information respecting the Property
that are in Seller's or Seller's current representative's possession
(collectively, the "Books and Records"). Seller shall make the Books and Records
available to Buyer at the offices of Seller, or at the Pacific Commercentre
Marketing Office in Lake Forest, CA, for inspection on reasonable prior notice,
which may be written or oral; provided that the Books and Records may include an
index of certain other documents not maintained in such location, copies of
which will be delivered upon specific, reasonable request therefor. Except as
expressly set forth herein, Seller makes no representation or warranty regarding
the correctness, accuracy or completeness of the Books and Records. The term
"Books and Records" specifically excludes corporate, financial and accounting
records and documents regarding the operations of Seller or its predecessor in
title or their affiliates or subsidiaries as an entity, as opposed to records
concerning only the Property; attorney-client communications and attorney work
product and property valuation information; loan documents regarding loans no
longer encumbering any of the Property, information regarding potential buyers,
marketing records, accounting data regarding properties formerly owned by Seller
or its predecessor in title, and agreements and records regarding the
partnerships that own or formerly owned any other Property; and Books and
Records that have been lost or destroyed or not in the possession of Seller or
Seller's current representative.
3.3 Condition of the Property. Subject to the approval or waiver of the
Contingencies and Buyer's Closing Conditions described in Section 4 and Section
5.1, and as a material inducement to Seller's execution and delivery of this
Agreement and performance of its duties hereunder, but without limiting the
effect of Seller's representations and warranties set forth in Section 7.1,
Buyer agrees, and represents and warrants, that it will purchase the Property
"as is" and solely in reliance on its own investigation of the Property. Buyer
agrees, and represents and warrants, that it has conducted (or will conduct to
the extent it deems appropriate) an investigation and determine to its
satisfaction each and every matter of concern or relevance relating to the
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Property, including without limitation the financial, legal title, physical and
environmental condition of the Property, soils, settlement or subsidence
conditions, applicable governmental laws and regulations, zoning, building code,
access, environmental, Environmental Laws (as defined in Section 11.1(a)) and
land use laws and regulations and the extent to which the Property complies
therewith, and the fitness of the Property for Buyer's contemplated use, the
presence of Hazardous Materials (as defined in Section 11.1(b)) on the Property
and, in general, its environmental condition, title matters and contracts to be
assumed by Buyer including the Pacific Commercentre Agreements, (collectively,
the "Condition of the Property"). Subject to the other provisions of this
Agreement, Buyer agrees and represents and warrants, that (i) it will purchase
the Property subject to each and every Condition of the Property, including
adverse conditions that may not have been revealed by its investigation of the
Property, (ii) Seller has no obligation to repair, correct or compensate Buyer
for any Condition of the Property, and (iii) by acquiring the Property, Buyer
shall be deemed to have waived any and all objections to the Condition of the
Property, whether or not any Condition of the Property would have been disclosed
by inspection. By acknowledging approval or waiver of the Contingencies and
Buyer's Closing Conditions pursuant to Section 4 and Section 5.1 and without
limiting Seller's obligations under Section 3.2, Section 8.3 or elsewhere in
this Agreement, Buyer shall be deemed to agree that no Condition of the
Property, whether or not known or discovered by either Buyer or Seller at a
later date, shall affect this transaction and the Purchase Price paid for the
Property hereunder, and that Buyer shall be obligated to purchase the Property
notwithstanding the Condition of the Property.
3.4 Buyer's Due Diligence.
(a) Limited Representations and Warranties. Buyer acknowledges that
Seller makes no representations or warranties express or implied with respect to
the Property except as made in Section 7.1. In light of Buyer's investigations,
the parties have negotiated the representations and warranties by Seller set
forth in Section 7.1 hereof. By acknowledging satisfaction of the Conditions and
Buyer's Closing Conditions described in Section 4 and Section 5.1 (or waiving
one or more thereof), Buyer acknowledges that, except as provided in the
representations and warranties in Section 7.1, Buyer is purchasing the Property
without any other express or implied warranties of Seller.
(b) Seller's Disclosures. Buyer acknowledges that any and all Books
and Records or other information of any type which Buyer has received or may
receive from Seller or Seller's agents is furnished without any warranty
whatsoever except as may be specifically set forth in Section 7.1. Buyer agrees
that Buyer will not attempt to assert any liability against Seller for
furnishing such information. Any disclosure whatsoever to Buyer pursuant to this
Agreement shall not enlarge or add to the warranties and representations of
Seller beyond those specifically set forth in Section 7.1.
(c) Buyer's Investigations. Buyer acknowledges that (i) by
acknowledging satisfaction of the Contingencies and Buyer's Closing Conditions
described in Section 4 and Section 5.1 (or waiving one or more thereof), Buyer
will be acknowledging that Seller has provided Buyer with adequate access to the
Books and Records and the Property, (ii) provided that Seller fulfills its
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obligations hereunder, Buyer has had, or will have by the Contingency Date,
ample opportunity to review and inspect the Books and Records and the Property
and to make such independent factual, physical and legal examinations and
inquiries as Buyer deems necessary or desirable with respect to the Condition of
the Property and the transaction contemplated hereby, (iii) in undertaking its
investigation, Buyer has been and will be advised by its independent architects,
attorneys, engineers and other advisors selected by it, and (iv) Buyer is and,
upon waiver of all Contingencies, will be fully satisfied that the Purchase
Price hereunder is fair and adequate consideration for the Property.
3.5 Release. Except to the extent provided in Section 9.2, Buyer
hereby waives, releases, acquits, and forever discharges Seller, and Seller's
agents, directors, officers and employees to the maximum extent permitted by
law, of and from any and all claims, actions, causes of action, demands, rights,
liabilities, damages, losses, costs, expenses, or compensation whatsoever,
direct or indirect, known or unknown, foreseen or unforeseen, that it now has or
which may arise in the future on account of or in any way growing out of or
connected with the Condition of the Property. BUYER EXPRESSLY WAIVES ANY OF ITS
RIGHTS GRANTED UNDER CALIFORNIA CIVIL CODE SECTION 1542, WHICH PROVIDES AS
FOLLOWS: "A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES
NOT KNOW OR SUSPECT TO EXIST IN HIS FAVOR AT THE TIME OF EXECUTING THE RELEASE,
WHICH IF KNOWN BY HIM MUST HAVE MATERIALLY AFFECTED HIS SETTLEMENT WITH THE
DEBTOR."
Initials: Buyer: __________ Seller: ___________
4. BUYER'S INITIAL CONTINGENCIES
Buyer's obligation to purchase the Property is expressly conditioned on
the fulfillment of each of the initial conditions precedent ("Contingencies")
described below. Except with respect to the Contingencies described in Section
4.1, Buyer shall deliver written notice to Seller that it (a) approves or waives
each Contingency, or (b) disapproves such contingency by no later than 5:00 p.m.
California time on the Contingency Date.
4.1 Title
(a) Title Objections. Within 7 Business Days after the opening of
escrow, Buyer shall obtain, and deliver a copy to Seller of, a CLTA preliminary
report issued by Fidelity Title Insurance Company (the "Title Insurer") and all
underlying documents referred to therein (the "Preliminary Report") for the Real
Property. It shall be a Buyer's Contingency, that on or before the Contingency
Date, Buyer shall review and inform Seller of its approval or disapproval, in
its sole discretion, of the Preliminary Report by giving Seller notice ("Buyer's
Title Notice") of any objection to the Preliminary Report (the "Title
Objections"). If Buyer fails to deliver timely notice by the required date,
Buyer shall be deemed to have approved the Preliminary Report. On or before the
fifth (5th) day after receipt of Buyer's Title Notice ("Seller's Notice Date"),
Seller shall notify Buyer in writing whether Seller will eliminate or
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cure such Title Objections (the "Seller's Title Notice") provided the method of
curing such Title objection shall be subject to Buyer's reasonable approval. If
Seller elects to eliminate or cure a Title Objection, the elimination or curing
by Seller of the Title Objections shall be completed on or before the Closing
(as defined in Section 8.2). If Seller elects to eliminate or cure a Title
Objection but fails to do so by the Closing, Buyer may pursue its remedies
pursuant to Section 9.2. If Seller (A) does not deliver Seller's Title Notice on
or before Seller's Notice Date, or (B) notifies Buyer that Seller is unable or
unwilling to cure any Title Objections, Buyer shall elect on or before three (3)
days after Seller's Notice Date either to waive such existing Title Objections
or deliver to Seller written notice terminating this Agreement pursuant to the
Section 4 subsection entitled "Disapproval of Contingencies". If Buyer fails to
give Seller notice of its election within the required period, Buyer shall be
deemed to have elected to waive such Title Objections.
(b) Additional Title Objections. If, after delivery of Buyer's Title Notice,
Buyer receives notice from the Title Insurer that it intends to revise the
Preliminary Report to include one or more additional exceptions to title, Buyer
may, within five (5) days of such notice, notify Seller ("Buyer's Amended Title
Notice") of the additional title exceptions to which, in its sole discretion, it
objects("Additional Title Objections"). If Buyer fails to deliver timely notice
within the required period, Buyer shall be deemed to have approved the
Additional Title Objections. Seller shall have the shorter of five (5) days
after Buyer's Amended Title Notice, or until two (2) Business Days before the
Closing Date, within which to deliver to Buyer a notice ("Seller's Amended Title
Notice") indicating whether Seller will eliminate or cure such Additional Title
Objections by the Closing. If Seller elects to eliminate or cure an Additional
Title Objection, the elimination or curing by Seller of the Additional Title
Objections shall be completed on or before the Closing. Seller agrees to
eliminate or cure Additional Title Objections caused by Seller. If Seller elects
to eliminate or cure a Title Objection but fails to do so by the Closing, Buyer
may pursue its remedies pursuant to Section 9.2. If Seller (a) does not deliver
Seller's Amended Title Notice within the required time, or (b) notifies Buyer
that Seller is unable or unwilling to cure such Additional Title Objections,
Buyer shall have the lesser of three (3) days or until the Closing to elect to
waive such Additional Title Objections or deliver to Seller written notice
terminating this Agreement pursuant to the Section 4 subsection entitled
"Disapproval of Contingencies". If Buyer fails to give Seller notice of its
election within the time set forth in the previous sentence, Buyer shall be
deemed to have elected to waive such Additional Title Objections.
(e) Permitted Exceptions. The term "Permitted Exceptions" shall mean (i)
all exceptions to title listed in the Preliminary Report to which Buyer does not
object in Buyer's Title Notice; (ii) Title Objections and Additional Title
Objections that Buyer waives or is deemed to have waived in accordance with the
provisions of this Section 4.1; and (iii) any matter that is approved, caused,
permitted or suffered by Buyer, its employees, agents, representatives or
affiliates. Notwithstanding the foregoing, Seller shall eliminate any and all
title exceptions consisting of mechanics lions, judgment liens, delinquent tax
lions and/or loans secured by mortgages, deeds of trust, security agreements or
fixture filings other than those approved, caused, permitted or suffered by
Buyer, its employees, agents, representatives or affiliates.
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(d) Issuance of Policy, Prior to the Contingency Date: (i) Buyer shall
notify Seller and Title Insurer as to any particular extended coverage policy
form, extended coverage policy, and any endorsements which Buyer may reasonably
desire ("Special Coverage"), and (ii) Buyer shall have obtained verbal
assurances, without the obligation to purchase a title commitment, of Title
Insurer's willingness to issue to Buyer at the Closing any such Special Coverage
in addition to a CLTA standard coverage Owner's Policy ("Title Policy") insuring
title to the Real Property in an amount equal to the Purchase Price insuring
that fee title to the Real Property is vested in Buyer, subject only to the
Permitted Exceptions, As a condition to Closing for Buyer's benefit, Title
Insurer shall be irrevocably and unconditionally committed to issue to Buyer the
Title Policy plus such Special Coverage, and if for any reason (other than a
default by Buyer) Title Insurer is unwilling to do so, then Buyer shall be
entitled to deliver to Seller on or before the Closing Date written notice of
the failure of such condition and the provisions of Section 4.5 shall apply;
provided however, if Buyer timely delivers to Seller written notice, then Seller
shall have the right, but not the obligation, to designate Chicago Title Company
as the Title Insurer should it be willing to issue the Title Policy and such
Special Coverage, and in such case Seller shall have the right to extend the
Closing Date as reasonably necessary for up to 30 days.
4.2 Contingency Review. It shall be a Contingency that, on or before the
Contingency Date, Buyer shall investigate and approve, in its sole discretion,
the Condition of the Property, Buyer's Reports, Books and Records, and all other
aspects of this transaction.
4.3 REIT Status. Buyer hereby advises Seller that Buyer is qualified as a
real estate investment trust under the provisions of the Internal Revenue Code
of 1986, as amended, and that, by reason thereof, the maintaining of such status
and the avoiding of any activity which might cause a penalty tax to be applied
is of material concern to Buyer. Accordingly, it is a Contingency that by the
Contingency Date, Buyer shall have determined to its satisfaction that purchase
of the Property will not affect its status as a real estate investment trust or
result in a penalty tax.
4.4 Executive Committee Approval. Notwithstanding anything to the
contrary contained in this Agreement, Buyer's obligation to purchase the
Property is conditioned upon the approval by Buyer's Executive Committee on or
prior to the Contingency Date of the transactions contemplated by this
Agreement.
4.5 Disapproval of Contingencies. If Buyer timely disapproves any
Contingency in writing, this Agreement shall automatically terminate, and
thereafter the parties shall have no further obligation or liability under this
Agreement, except as provided in this subsection. Subject to Buyer's obligations
and covenants under Section 3.1, the Deposit shall be returned to Buyer. Buyer's
failure to provide timely written notice of disapproval of any Contingency shall
be deemed a waiver of such Contingency. Any cancellation fee or other costs of
the Escrow Holder and Title Insurer shall be borne equally by Seller and Buyer
and each party shall pay its own expenses.
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4.6 Adequate Consideration. Notwithstanding anything in this Agreement to
the contrary, to induce Buyer to enter into this Agreement and to expend the
time and resources necessary to evaluate the Property and possibly forego other
opportunities while doing so, Seller hereby grants to Buyer the rights to
terminate this Agreement on or before the Contingency Date. Such expenditures of
time and resources and possible loss of opportunity by Buyer constitute adequate
consideration for Seller's remaining bound by this Agreement notwithstanding
such termination rights in Buyer. In the event this Agreement is terminated
pursuant to this Section 4, all obligations of Buyer and Seller hereunder
(except the provisions of this Agreement which recite that they survive
termination) shall terminate and be of no further force or effect.
5. CONDITIONS TO CLOSING
5.1 Buyer's Closing Conditions. Buyer's obligation to purchase the Property
is expressly conditioned on the fulfillment of each of the conditions precedent
at or before Closing described below ("Buyer's Closing Conditions"). Buyer's
Closing Conditions are solely for Buyer's benefit and any and all of Buyer's
Closing Conditions may be waived in writing by Buyer in whole or in part without
prior notice.
(a) Delivery of Closing Documents. It shall be a Buyer's Closing Condition
that Seller shall deliver through escrow the documents specified in Section 8.3.
(b) Performance of Covenants. It shall be a Buyer's Closing Condition that
Seller shall perform the material covenants of Seller under this Agreement to be
performed by Seller before Closing.
5.2 Seller's Closing Conditions. Seller's obligation to sell the Property
is expressly conditioned upon the fulfillment of each of the conditions
precedent at or before Closing described below ("Seller's Closing Conditions").
Seller's Closing Conditions are solely for Seller's benefit and any or all of
Seller's Closing Conditions may be waived in writing by Seller in whole or in
part without prior notice.
(a) Waiver of Contingencies. It shall be a Seller's Closing Condition that
Buyer shall have acknowledged its approval or waiver of all the Contingencies by
delivering to Seller written notice thereof.
(b) Purchase Price. It shall be a Seller's Closing Condition that Buyer
shall have delivered to Seller through Escrow the Purchase Price, upon
satisfaction of Seller's closing obligations.
(c) Delivery of Closing Documents and Funds. It shall be a Seller's
Closing Condition that Buyer deliver through Escrow the documents and funds
specified in Section 8.4.
(d) Performance of Covenants. It shall be a Seller's Closing Condition that
Buyer shall have performed the material covenants of Buyer under this Agreement.
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5.3 Termination. If Buyer's Closing Conditions or Seller's Closing
Conditions, as the case may be, are not approved or waived (including a deemed
waiver) within the time period allowed, this Agreement may be terminated by the
party in whose favor the Closing Condition runs by written notice to the other.
If this Agreement is so terminated, the parties shall have no further obligation
or liability under this Agreement, except as provided in Section 9, and this
Section 5.3. Subject to Buyer's obligations and covenants under Section 3.1, the
Deposit shall be returned to Buyer. Any cancellation fee or other costs of the
Escrow Holder shall be borne equally by Seller and Buyer and each party shall
pay its own expenses.
6. CC&R
6.1 Changes. Buyer acknowledges and agrees that, either before or after the
close of escrow, Seller shall have the right, but not the obligation to amend
the CC&R (defined below) in order to accomplish any or all of the following
("Changes"): (i) add in the restriction described in Section 6.2; and (ii)
implement such other changes to the CC&R reasonably approved by Buyer. Buyer
agrees to cooperate with all of Seller's efforts to make the Changes, including,
if necessary, execution of any amendment or new or additional agreement to the
CC&R; provided however, Buyer shall have the right to reasonably disapprove any
Change which either (i) pertains to the Land, or (ii) increases Buyer's
liabilities or obligations. "CC&R" means the Declaration of Covenants,
Conditions and Restrictions for Pacific Commercentre between LADCO and Pacific
Commercentre Partners, recorded on January 10, 1991, as Document No. 91-013945
in the Official Records of Orange County, California, as amended from time to
time.
6.2 Self Storage Development Restriction. Seller shall have the right to
amend the CC&R to prohibit construction of a "self storage project" on some or
all of the lots specified below ("Restricted Lots") and to provide that such
provision cannot be modified without the consent of ▇▇▇ ▇▇ ▇▇ ▇▇▇▇▇ ▇▇▇▇▇
("Benefitted Lot"). Such prohibition shall commence on September 5, 1995 and
shall terminate on the later of termination of the CC&R or March 22, 2007. The
term "self storage project" means a project having more than 10,000 gross square
feet of individual storage rental units, partitioned for the exclusive use of
one tenant, with separate secure access. The Restricted Lots are the following:
Tract 13343, Lots 4-5, 12-19; ▇▇▇▇▇ ▇▇▇▇▇, Lots 1-6, 10; ▇▇▇▇▇ ▇▇▇▇▇, Lots 3-23,
27-29, 39-44; and ▇▇▇▇▇ ▇▇▇▇▇, Lots 1-2.
7. REPRESENTATIONS AND WARRANTIES
7.1 Seller's Representations and Warranties. Seller hereby warrants and
represents as of the date hereof and as of the Closing as set forth below. To
the extent any representation or warranty made by Seller is actually known by
Buyer or its agents or employees before the Contingency Date to be untrue or
inaccurate (and Buyer fails to terminate this Agreement under Section 4), Buyer
shall have no right under this Agreement solely by reason of that particular
untruth or inaccuracy to terminate this Agreement or to seek relief against
Seller on account of such breach of representation.
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(a) Organization; Authority. Seller is a corporation duly organized,
validly existing and in good standing under the laws of the State of California.
Seller has full power and authority to enter into and perform under this
Agreement. Makena Properties is fully authorized to execute this Agreement on
behalf of Seller.
(b) Litigation. Seller has received no written notice of any pending
litigation or arbitration proceeding or threatened litigation or arbitration
directly affecting the Property or this transaction to which Seller is a party.
Seller shall notify Buyer of any pending or threatened litigation of which
Seller receives notice from time to time by Seller until immediately before
Closing, and the provisions of Section 7.3 shall apply to such revisions.
(c) Governmental Action. Seller has received no written notice from any
governmental agency concerning any governmental proceeding or investigation of
the Property, any violation of any laws with respect to the Property, any
pending condemnation proceeding or any formal notice of condemnation involving
the Property,
(d) Foreign Person. Seller is not a foreign person and is a "United States
Person" as such term is defined in ss.7701(a)(30) of the Internal Revenue Code
of 1986, as amended (the "Code").
(e) Hazardous Material. To Seller's knowledge, except as disclosed in the
Books and Records: (i) there is no Hazardous Material on the Real Property that
is in violation of any applicable law or requires investigation or remedial
action under applicable law; and (ii) no underground storage tanks (whether
existing or abandoned) exist or have existed on or under the Property or on or
under any property now or previously owned by Seller adjacent to the Property.
(f) To Seller's knowledge, water, gas, sewer, electric, and telephone
utilities are available to the Property.
(g) The Books and Records delivered by Seller to Buyer, or made available
to Buyer for review, are true and complete copies of all Books and Records in
Seller's or Seller's current representative's possession or control.
(h) Except for the Permitted Exceptions, there are no outstanding written
or oral contracts which run with the Property or which will be binding upon
Buyer upon the Closing for: (i) any improvements to the Property, or (ii)
offsite improvements related to the Property which have not been fully completed
and paid for. Seller shall cause to be discharged all mechanics' and
materialmen's liens arising from any labor or materials furnished to the
Property prior to the Closing other than by Buyer.
(i) The Books and Records include the Property Agreements and, to Seller's
knowledge, all amendments thereto.
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7.2 Seller's Knowledge. As used in this Agreement, the phrase "Seller's
knowledge" shall be limited to the actual knowledge of ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ and
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, without having made any independent analysis, investigation or
inquiry with respect to the matter so qualified. ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ has been the
manager of the Property since approximately July 1995.
7.3 Subsequent Disclosures. If, after the date hereof and before Closing,
Seller or Buyer discovers facts, or facts arise, that make one or more of the
representations and warranties made by Seller in Section 7.1 materially
incorrect, Seller or Buyer (as the case may be) shall immediately notify the
other in writing of such facts. Thereafter, Seller may elect to correct the
representation and warranty and to cure the matter referred to so that its
representations and warranties are no longer incorrect, or may decline to do so.
If Seller declines so to cure such matter or if such cure is not completed by
Closing, Buyer may, at its option, (i) proceed to buy the Property pursuant to
this Agreement, in which case Buyer's objection to the incorrectness of Seller's
representations and warranties shall be deemed waived by Buyer, or (ii)
terminate this Agreement, implementing the termination provisions in the
Section 4 subsection entitled "Disapproval of Contingencies", except in the
event of Seller's actual fraud or intentional misrepresentation, in which case
the provisions of Section 9.2 shall control.
7.4 Buyer's Representations and Warranties. In addition to its
representations and warranties made elsewhere in this Agreement, Buyer hereby
warrants and represents as of the date hereof and as of the Closing Date that
Buyer: is the entity as described in the preamble, duly organized, validly
existing and in good standing under the laws of the State of California;
possesses full power and authority to enter into and perform this Agreement; and
has sufficient financial resources to fund payment of the Purchase Price at
Closing and to perform all of Buyer's assumed obligations.
7.5 Survival. All representations and warranties contained in this
Section 7 shall survive Closing for one (1) year and then shall automatically
terminate; provided however if Seller receives written notice from Buyer within
one year after the Closing Date, which notice sets forth a specific, alleged
breach of a representation and warranty ("Claim"), such Claim shall survive for
an additional six (6) month period, and thereafter as provided by applicable law
provided that an action has been filed and served on Seller within such six (6)
month period. Except to the extent permitted by Section 9.2, Buyer shall not be
entitled to bring any claim against Seller for misrepresentation or breach of
warranty if and to the extent Buyer had the right to terminate this Agreement
prior to the Closing Date without forfeiture of the Deposit by reason thereof.
8. CLOSING
8.1 Escrow. An escrow ("Escrow") shall be opened with the Escrow Holder at
its office in Irvine, California, within two (2) Business Days after the full
execution of this Agreement. Buyer and Seller shall promptly upon request
therefor execute such additional escrow
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instructions as are reasonably required to consummate the transaction
contemplated by this Agreement and are not inconsistent herewith.
8.2 Closing. The "Closing" means the exchange of money and documents as
described herein, and will be deemed to have occurred when Seller's Grant Deed
to Buyer has been recorded, the Escrow Holder holds and can record and deliver
the remaining documents described in this Section 8 and is irrevocably and
unconditionally committed to issue the Title Policy and Buyer has delivered the
Purchase Price in immediately available funds to the Escrow Holder. Seller and
Buyer agree that the Closing shall occur on the Closing Date. The Closing will
be at the offices of the Escrow Holder or such other place as the parties may
agree.
8.3 Seller's Closing Obligations Not later than one (1) Business Day before
the Closing Date, Seller shall deliver to the Escrow Holder for delivery to
Buyer (or the party noted below) through Escrow the following:
(a) The Grant Deed, duly executed and acknowledged by the Seller and in
recordable form;
(b) The Assignment and Assumption Agreement in the form of Exhibit C
hereto, duly executed by Seller in counterpart;
(c) Certificates required by Section 1445 of the Internal Revenue Code of
1986, as amended, and California Revenue and Taxation Code Section 18815
executed by Seller and in a form satisfactory to Buyer, to relieve Buyer of any
potential transferee withholding liability under such Section;
(d) Such proof of Seller's authority and authorization to enter into this
Agreement and perform hereunder, and such proof of power and authority of the
individuals executing and/or delivering any instruments, documents or
certificates on behalf of Seller to act for and bind Seller as may reasonably be
required by the Escrow Holder;
(e) The Supplement to Exhibit C-1 of Declaration of Covenants, Conditions
and Restrictions, duly executed and acknowledged by Seller and in recordable
form in the form of Exhibit F to reflect the Building Density for each Lot
("CC&R Amendment").
(f) Other documents reasonably required to properly consummate this
transaction.
8.4 Buyer's Closing Obligations. Not later than one (1) Business Day before
the Closing Date (except for the funds described in Section 8.4(a) which shall
be wire transferred to Escrow Holder the morning of the Closing), Buyer will
deliver to the Escrow Holder for delivery to Seller (or the party noted below)
through Escrow the following:
(a) Immediately available federal funds as are required to be paid by Buyer
under this Agreement in an amount equal to the Purchase Price, minus the amount
of the Deposit paid
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by Buyer and adjusted for estimated prorations and closing costs. plus, if
applicable, the additional monies described in Section 1.5;
(b) The Assignment and Assumption Agreement, duly executed by Buyer in
counterpart;
(c) A Special Tax Disclosure Agreement Re Community Facilities District
No. 87-7 of the County of Orange (Los Alisos) (the "Special Tax Disclosure
Agreement"), in form attached as Exhibit D, for delivery to the County of
Orange;
(d) Such proof of Buyer's authority and authorization to enter into this
Agreement and perform hereunder, and such proof of power and authority of the
individuals executing and/or delivering any instruments, documents or
certificates on behalf of Buyer to act for and bind Buyer as may reasonably be
required by the Escrow Holder; and
(e) Other documents reasonably required to properly consummate this
transaction.
8.5 Close of Escrow, If on the Closing Date, (i) the Escrow Holder holds
and can deliver the documents described in Section 8.3 and Section 8.4. (ii) the
Escrow Holder is irrevocably and unconditionally committed to issue the Title
Policy with respect to the Property, (iii) the Buyer has delivered the funds
required under Section 8.4(a), and (iv) the Escrow Holder can record the Grant
Deed for the Property, then the Escrow Holder shall:
(a) Record the CC&R Amendment and Grant Deed in that order;
(b) Deliver the Purchase Price (less Seller's share of any net prorations
and closing costs) as directed by Seller;
(c) Deliver the remaining documents to the parties specified in Section 8.3
and Section 8.4;
(d) Deliver the remaining funds to Seller or Buyer, as the case may be,
after taking into account all items chargeable to the account of Seller and
Buyer pursuant to Section 8.8 and Section 8.9; and
(e) Deliver the Special Tax Disclosure Agreement to the County of Orange.
8.6 Termination of Escrow. If Closing does not take place as set forth in
Section 8.2, then the Escrow shall terminate, all documents deposited into
Escrow shall be returned to the respective parties, and, subject to Section 9,
the Deposit shall be returned to Buyer.
8.7 Possession. Seller shall retain possession of the Property until
Closing and shall deliver possession to Buyer upon Closing.
8.8 Prorations.
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(a) Prorations Paid Through Escrow. Real property taxes and current
installments of assessments applicable to the Property and other expenses
applicable to the Property shall be prorated as of the Closing Date, with
expenses allocable to the period on and after Closing Date to be for Buyer's
account, and expenses allocable to the period before the Closing Date to be for
Seller's account. Any property taxes assessed against the Property after the
Closing Date, with respect to any period of time before the Closing Date, shall
be paid by Seller on demand. All prorations shall be made as of 12:01 a.m. on
the Closing Date and Buyer shall bear the burden of the expenses for such day.
(b) Adjustment After Closing. Any expense which cannot be ascertained with
certainty as of the Closing Date shall be prorated on the basis of the parties'
reasonable estimates of such amounts and shall be the subject of a final
proration as soon thereafter as the precise amounts can be ascertained but in no
event later than one hundred twenty (120) days after the Closing. A statement
setting forth such agreed proration for purposes of Closing shall be delivered
by Buyer and Seller to the Escrow Holder, provided Escrow Holder shall not be
required to calculate any prorations. Seller and Buyer shall each cooperate with
the other diligently and promptly to correct any errors in computations or
estimates under this Section 8.8 and shall promptly pay to the party entitled
thereto any refund, credit or other payment necessary to comply with this
Section 8.8. This Section 8.8 shall survive the Closing. Either party owing the
other party a sum of money based on adjustments made to prorations after the
Closing shall promptly pay that sum to the other party, together with interest
thereon at the rate of Ten Percent (10%) per annum from the date of demand of
payment to the date of payment if payment is not made within ten (10) days after
demand therefor.
8.9 Closing Costs. Seller shall pay the real property transfer taxes on
this transaction and the premium for a standard form (CLTA) owner's policy of
title insurance in the amount of the Purchase Price and any endorsement Seller
agrees to obtain to resolve any title objection. Buyer shall pay any additional
premiums or charges with respect to the Title Policy, including any extended
coverage and endorsements other than those specified in the prior sentence.
Seller and Buyer shall each pay one-half of the escrow fees. Seller shall pay
the costs of recording any necessary releases or reconveyances, and Buyer shall
pay the costs of recording the Grant Deed and any other documents. All other
closing costs shall be divided as is customary in Orange County. This Section
8.9 shall survive the Closing,
8.10 Commissions. Provided the transaction described in this Agreement
closes, Seller shall pay through Escrow at Closing real estate broker's
commissions to ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇ of California, Inc. ("Seller's Broker")
pursuant to a separate agreement ("C&W Agreement"). Buyer represents and
warrants to Seller that it has engaged Buyer's Broker to represent Buyer in
connection with this Agreement. Other than the payment under the C&W Agreement,
Buyer represents and warrants to Seller that no fee or commission shall be
payable by reason of this transaction either to Buyer, Buyer's Broker or to any
broker or finder representing Buyer. Seller agrees to defend, indemnify and hold
harmless Buyer from and against any and all liabilities, claims, demands,
damages, or costs of any kind (including attorneys' fees, costs and expenses)
arising from or connected with any broker's or finder's fee or commission or
charge
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("Broker Claims") claimed to be due by Seller's Broker or any person other than
Buyer's Broker (other than payment under the C&W Agreement) arising from or by
reason Of Seller's conduct with respect to this transaction. Buyer agrees to
defend, indemnify and hold harmless Seller from and against any and all Broker
Claims claimed to be due by Buyer's Broker or any person other than Seller's
Broker arising from or by reason of Buyer's conduct with respect to this
transaction. The provisions of this Section 8.10 shall survive Closing
hereunder.
8.11 Parties to Bear Own Expense. Each of the parties hereto shall pay all
the costs and expenses incurred or to be incurred by them in negotiating and
preparing this Agreement and in carrying out the transaction contemplated
hereby.
8.12 General Escrow Instructions. The general escrow instructions in
Exhibit E are hereby incorporated herein by this reference. Any conflict between
this Agreement and Exhibit E shall be construed in favor of this Agreement.
8.13 Reporting Requirements. The Escrow Holder shall comply with all
applicable federal, state and local reporting requirements relating to the close
of the transactions contemplated herein. Without limiting the generality of the
foregoing, to the extent the transactions contemplated by this Agreement involve
a real estate transaction with the purview of Section 6045 of the Internal
Revenue Code of 1986, as amended (the "Internal Revenue Code"), Escrow Holder
shall have sole responsibility to comply with the requirements of Section 6045
of the Internal Revenue Code (and any similar requirements imposed by state or
local law). For purposes hereof, Seller's tax identification number is
▇▇-▇▇▇▇▇▇▇. Escrow Holder shall hold Buyer, Seller and their counsel free and
harmless from and against any and all liability, claims, demands, damages and
costs, including reasonable attorney's fees and other litigation expenses,
arising or resulting from the failure or refusal of Escrow Holder to comply with
such reporting requirements.
9. DEFAULT
9.1 Buyer's Default.
(a) Default. Buyer shall be deemed to be in default hereunder if Buyer
fails, for any reason other than Seller's default hereunder or the failure of a
condition precedent to Buyer's obligation to perform hereunder, to meet, comply
with or perform any covenant, agreement or obligation on its part required
within the time limits and in the manner required in this Agreement, or there
shall have occurred a material breach of any representation or warranty made by
Buyer; provided, however, no such default shall be deemed to have occurred
unless and until Seller has given Buyer written notice thereof, describing the
nature of the default, and Buyer has failed to cure such default within five (5)
days of the receipt of such notice (but in any event before the Closing Date,
unless such default occurs after Closing).
(b) Liquidated Damages. IF THE CLOSING FAILS TO OCCUR BY REASON OF DEFAULT
OF BUYER UNDER THE TERMS OF THIS AGREEMENT, BUYER SHALL
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BE RESPONSIBLE FOR ALL CANCELLATION CHARGES REQUIRED TO BE PAID TO ESCROW HOLDER
AND ANY ESCROW CHARGES. IN ADDITION, THIS AGREEMENT AND THE RIGHTS AND
OBLIGATIONS OF THE PARTIES SHALL TERMINATE AND THE DEPOSIT SHALL BE IMMEDIATELY
DELIVERED BY ESCROW HOLDER TO SELLER ON SELLER'S REQUEST. THE DEPOSIT SHALL BE
DEEMED LIQUIDATED DAMAGES FOR BUYER'S FAILURE TO ACQUIRE THE PROPERTY AS
SELLER'S SOLE AND EXCLUSIVE REMEDY AGAINST BUYER (INCLUDING, WITHOUT LIMITATION,
SELLER'S RIGHTS TO SEEK SPECIFIC PERFORMANCE OF THIS AGREEMENT AND TO RECEIVE
DAMAGES FOR FAILURE TO ACQUIRE THE PROPERTY) WHICH SUM SHALL BE PRESUMED TO BE A
REASONABLE ESTIMATE OF THE AMOUNT OF ACTUAL DAMAGES SUSTAINED BY SELLER BY
REASON OF BUYER'S BREACH OF ITS OBLIGATION TO ACQUIRE THE PROPERTY. FROM THE
NATURE OF THIS TRANSACTION, IT IS IMPRACTICABLE AND EXTREMELY DIFFICULT TO FIX
THE ACTUAL DAMAGES THAT SELLER WOULD SUSTAIN, SHOULD BUYER BREACH ANY OF ITS
OBLIGATIONS. THE IMPRACTICABILITY AND DIFFICULTY OF FIXING ACTUAL DAMAGES IS
CAUSED BY, WITHOUT LIMITATION, THE FACT THAT THE PROPERTY IS UNIQUE. GIVEN THE
FOREGOING, AMONG OTHERS, BUYER AND SELLER AGREE THAT LIQUIDATED DAMAGES ARE
PARTICULARLY APPROPRIATE FOR THIS TRANSACTION AND AGREE THAT SAID LIQUIDATED
DAMAGES SHALL BE PAID IN THE EVENT OF BREACH BY BUYER, NOTWITHSTANDING ANY WORDS
OR CHARACTERIZATIONS PREVIOUSLY USED OR HEREIN CONTAINED IMPLYING ANY CONTRARY
INTENT, THE PAYMENT OF SUCH AMOUNT AS LIQUIDATED DAMAGES IS NOT INTENDED AS A
FORFEITURE OR PENALTY WITHIN THE MEANING OF CALIFORNIA CIVIL CODE SECTIONS 3275
OR 3369, BUT IS INTENDED TO CONSTITUTE LIQUIDATED DAMAGES TO SELLER PURSUANT TO
CALIFORNIA CIVIL CODE SECTIONS 1671, 1676 AND 1677. NOTHING HEREIN SHALL,
HOWEVER, BE DEEMED TO LIMIT BUYER'S LIABILITY TO SELLER FOR DAMAGES OR
INJUNCTIVE RELIEF FOR BREACH OF ANY OTHER OBLIGATION OF BUYER HEREUNDER (OTHER
THAN ITS OBLIGATION TO ACQUIRE THE PROPERTY), INCLUDING INDEMNITY OBLIGATIONS OF
BUYER, OR FOR ATTORNEYS' FEES AND COSTS AS PROVIDED IN SECTION 1.14.
Buyer's Initials /s/ Seller's Initials /s/
------- -------
9.2 Seller's Default.
(a) Default. Seller shall be deemed to be in default hereunder if Seller
fails, for any reason other than Buyer's default hereunder or the failure of a
condition precedent to Seller's obligation to perform hereunder, to meet, comply
with, or perform any covenant, agreement or obligation on its part required
within the time limits and in the manner required in this Agreement, or there
shall have occurred a material breach of any representation or warranty (made by
Seller); provided, however, no such default shall be deemed to have occurred
unless and until Buyer has given Seller written notice thereof, describing the
nature of the default, and
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Seller has failed to cure such default within five (5) days of receipt of such
notice (but in any event before the Closing Date, unless such default occurs
after Closing).
(b) Remedies. If Seller shall be deemed to be in default under Section
9.2(a) at or before Closing, and Buyer does not waive such default, Buyer may
pursue one of the following remedies, each of which shall be Buyer's sole and
exclusive remedy:
(i) Enforce specific performance of this Agreement against Seller, in
which case Buyer shall have no claim for damages or any other remedy
against Seller; or
(ii) Terminate this Agreement by written notice delivered to Seller on or
before the Closing Date, provided that:
(A) Buyer may seek damages in an amount equal to its actual out-of-
pocket expenses in conducting due diligence with respect to this
transaction, in an amount not to exceed the Deposit; and
(B) If Buyer establishes actual fraud or intentional misrepresentation
by Seller, Buyer may also seek from Seller other actual and/or "out of
pocket" damages by reason thereof and the difference between the price
agreed to be paid and the value of the Property at the time of the
breach, but no other consequential or other damages or exemplary
damages, and in any event such damages shall not exceed in total the
amount of the Deposit.
(c) Remedies After Closing.
(i) If the Closing has occurred, Buyer shall not be entitled to recovery
from Seller for breach of contract, for tort, or for any other reason
unless Buyer establishes, through actual fraud or intentional
misrepresentation by Seller, that Seller shall have breached a
representation or warranty contained in Section 7.1 that has not terminated
or Seller has not performed a covenant to eliminate or cure Title
Objections or Additional Title Objections pursuant to Section 4.1, in which
case Buyer may seek actual and/or "out of pocket" damages by reason
thereof, but shall not be entitled to consequential or other damages or
exemplary damages or any other damages or remedy, and in any event the
amount of such damages shall be equal to the lesser of (A) the cost to cure
or remove such default or (B) the amount of Deposit.
(ii) Buyer shall not be entitled to bring any claim against Seller for
misrepresentation or breach of warranty if and to the extent Buyer or
Buyer's agents or employees had actual knowledge before Closing of the
existence of any condition, fact or circumstance giving rise to such claim,
or with respect to any information described in or disclosed by any report
delivered to Buyer and despite such knowledge, still acquired the Property
affected by the misrepresentation or breach of warranty.
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(d) Termination Procedure. Upon termination of this Agreement in accordance
with ss.9.2, the Deposit shall be promptly returned to Buyer by the Escrow
Holder upon receipt of written notice from Seller and Buyer that Seller has
defaulted under this Agreement. Seller shall be responsible for all cancellation
charges and escrow charges required to be paid to the Escrow Holder. Buyer shall
deliver copies of the Buyer's Reports to Seller pursuant to ss.3.1(d).
10. RISK OF LOSS. If before Closing either (i) any action or proceeding is
commenced for the condemnation or exercise of the rights of eminent domain of
the Property or any portion thereof, or if Seller is notified of a planned
condemnation by the duly authorized officer of a duly empowered condemning
authority, or (ii) there occurs any material and adverse physical change to the
Land, then at Buyer's option either (i) if applicable, at Closing Seller shall
assign and turn over, and Buyer shall be entitled to keep, all awards for the
taking by eminent domain which accrue to Seller and the parties shall proceed
with the Closing, without modifying the terms of this Agreement and without
reducing the Purchase Price; or (ii) Buyer may terminate this Agreement in which
case the Deposit shall be returned to Buyer. Seller shall not negotiate, resist
or stipulate to the condemning action without Buyer's written consent. In any
event, the Closing shall not be affected, delayed or prevented as a result of
such condemning action unless Buyer elects to terminate pursuant to subsection
(ii).
11. MISCELLANEOUS
11.1 Definition of Hazardous Material.
(a) Environmental Laws. "Environmental Laws" shall mean any and all present
and future federal, state and local law (whether under common law, statute,
rule, ordinance, agreement, regulation or otherwise), requirement under any
permit issued with respect thereto, and other requirements of agencies having
jurisdiction thereunder relating to the protection of human health or the
environment, including (without limitation) the Federal Insecticide, Fungicide,
and Rodenticide Act, 7 U.S.C. ss.ss.136, et seq.; the Toxic Substances Control
Act, 15. U.S.C. ss.ss.2601, et seq.; Federal Asbestos Hazard Emergency Response
Act, 15 U.S.C. ss.ss.2641 et seq.; the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, 42 U.S.C, ss.ss.9601, et seq.
("CERCLA"); the Resource Conservation and Recovery Act, 42 U.S.C. ss.ss.6901 et
seq. ("RCRA"); the Federal Water Pollution Prevention and Control Act, 33 U.S.C.
▇▇.▇▇. 1251 et seq. (the "Clean Water Act"); the Hazardous Materials
Transportation Act, 49 U.S.C. ss.ss.1801, et seq.; the Solid Waste Disposal Act,
42 U.S.C. ss.ss.6901, et seq.; the Federal Water Pollution Control Act, 33
U.S.C. ss.ss.1321; 42 U.S.C. ss.ss.7401 et seq. (the "Clean Air Act"); the
California Hazardous Waste Control Act, Cal. Health & Safety Code ("H.&S.C.")
ss.ss.25100 et seq.; the California Hazardous Substance Account Act, H.& S.C.
ss.ss.25300 et seq.; the California Safe Drinking Water and Toxic Enforcement
Act, H.& S.C., ss.ss.25249.5, et seq. ("Proposition 65"); the California
Hazardous Waste Management Act, H.&S.C. ss.ss.25170.1 et seq.; H.&S.C.
ss.ss.25501 et seq. (Hazardous Materials Response Plans and Inventory); the
▇▇▇▇▇▇-Cologne Water Control Act, Cal. Water Code ss.ss.13000 et seq.; H.&S.C.
ss.ss.25280, et seq. (Underground Storage of Hazardous Substances); H.&S.C.
ss.25915 et seq. (the
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"▇▇▇▇▇▇▇▇ Act"); H.&S.C. ss.25359,7; H.&S.C. ss.ss.2595 et seq.; Cal. Labor Code
ss.ss.6501.5 et seq.; and Title 22 of the California Code of Regulations; all as
amended to the date hereof,
(b) Hazardous Material. "Hazardous Material" shall include any chemical.
compound, material, mixture or substance which is now or hereafter defined or
listed in, or otherwise classified pursuant to, any Environmental Law as a
"hazardous substance," "hazardous material," "reproductive toxicant," "hazardous
waste," "extremely hazardous waste," "infectious waste," "biohazardous waste,"
"medical waste," "toxic substance," "toxic pollutant," "pollutant,"
"contaminant" or any other formulation intended to define, list, or classify
substances by reason of deleterious properties to human health, safety or the
environment, such as ignitability, corrosivity, reactivity, carcinogenicity,
radioactivity or toxicity, including all petroleum hydrocarbon,
petroleum-derived material, natural gas, natural gas liquids, liquified natural
gas, or synthetic gas usable for fuel (or mixtures of natural gas and such
synthetic gas), asbestos and those substances listed in the United States
Department of Transportation Table (49 CFR 172.101, as amended).
11.2 Definition of Business Day. For purposes of this Agreement, "Business
Day" means any day other than Saturday, Sunday or a holiday observed by national
or federally chartered banks. Any event specified to occur on a non-Business Day
shall be extended automatically to the end of the first Business Day thereafter.
11.3 Binding Effect. Subject to the restrictions on assignment contained
in ss.11.4, this Agreement shall be binding on and shall inure to the benefit of
the parties to it and their respective legal representatives, successors and
assigns.
11.4 Assignment. This Agreement may not be assigned by Buyer without
Seller's prior written consent which may be withheld in Seller's sole
discretion; provided that Buyer may assign this Agreement without Seller's
consent to an assignee provided that the assignee executes an assumption
agreement in form and substance reasonably acceptable to Seller. Seller shall
have the right to assign this Agreement at any time.
11.5 Severability. If any term, covenant, provision, paragraph or condition
of this Agreement shall be illegal, such illegality shall not invalidate the
whole Agreement, but, to the extent permitted by law, the Agreement shall be
construed to give effect to the intent manifested by the portion held
inoperative or invalid and the rights and obligations of the parties shall be
construed and enforced accordingly.
11.6 Entire Understanding. This Agreement represents the entire
understanding of Buyer and Seller and supersedes all prior and concurrent
written or oral agreements or representations, if any, relative to the subject
matter involved.
11.7 Amendments. This Agreement may not be modified, changed or
supplemented except by written instrument signed by both parties.
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11.8 California Law. The interpretation and performance of this Agreement
shall be governed by the laws of the State of California applied to agreements
to be performed entirely within the State of California by residents of the
State of California.
11.9 Waiver. Other than deemed waivers provided for herein, all waivers
by either party shall be in writing. The waiver by either party of any breach of
any term, covenant or condition of this Agreement shall not be deemed a waiver
of such term, covenant or condition or any subsequent breach of the same or any
other term, covenant or condition of this Agreement,
11.10 Notices. Any and all notices or other communication required or
permitted by this Agreement or by law to be served on or given to a party hereto
by the other party shall be in writing and given personally (including overnight
courier), by facsimile transmission or by registered or certified mail (postage
fully prepaid) addressed as follows:
To Buyer: Pacific Gulf Properties, Inc.
▇▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Copy to: ▇▇▇, Castle & ▇▇▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇ ▇. ▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
To Seller: PacTel Systems
c/o Makena Properties
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Copy to: ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP
▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Esq.
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
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To Escrow Holder: Fidelity National Title Insurance Company
▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇
Attn: ▇▇▇ St. ▇▇▇▇
Phone: ▇▇▇ ▇▇▇ ▇▇▇▇
Facsimile No.: ▇▇▇ ▇▇▇ ▇▇▇▇
Either party may change such address by written notice to the Other. Any notice
delivered as described above shall be deemed received on the date of delivery.
11.11 Captions. The captions inserted herein are inserted only as a matter
of convenience and for reference and in no way define, limit or describe the
scope of this Agreement or the intent of any of the provisions hereof.
11.12 Exhibits. All exhibits and schedules referred to herein are
incorporated by reference as though fully set forth herein.
11.13 Time of the Essence. Time is of the essence in this Agreement and
failure to comply with this provision shall be a material breach of this
Agreement.
11.14 Attorneys' Fees. Should any party institute any action, proceeding,
suit, arbitration, appeal or other similar proceeding or other non-judicial
dispute resolution mechanism ("Action") to enforce or interpret this Agreement
or any provision hereof, for damages by reason of any alleged breach of this
Agreement or of any provision hereof, or for a declaration of rights hereunder,
the prevailing party in such Action shall be entitled to receive from the other
party(s) all reasonable attorneys' fees, accountants' fees, expert witness fees,
and any and all other similar fees, costs and expenses incurred by the
prevailing party in connection with the Action and preparations therefor
("Fees"). If any party files for protection under, or voluntarily or
involuntarily becomes subject to, any chapter of the United States Bankruptcy
Code or similar state insolvency laws, any other party shall be entitled to any
and all Fees incurred to protect such party's interest and other rights under
this Agreement, whether or not such action results in a discharge.
11.15 Additional Cooperation. Seller and Buyer agree to execute such
additional documents or take such additional action, without cost or expense, as
may be reasonably necessary or desirable to carry out the provisions of this
Agreement or to further perfect the conveyance, transfer and assignment of the
Property to Buyer. This provision survives the Closing.
11.16 Confidentiality. Seller and Buyer agree that neither Seller nor Buyer
shall disclose to any third party (except as required to obtain consents
necessary to consummate the sale and to obtain governmental approvals) the
Purchase Price or the terms and conditions of this Agreement. This provision
shall not limit disclosure to the Escrow Holder, to Buyer's prospective partners
or lenders, or to the agents, consultants and attorneys retained by Seller
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and Buyer in connection with this transaction or disclosure required by
applicable laws. Notwithstanding anything to the contrary in this Agreement,
this ss.11.16 shall survive Closing or the earlier termination of this
Agreement.
11.17 Memorandum. Seller and Buyer agree that neither party shall record a
memorandum of this Agreement.
11.18 Consent to Jurisdiction. Seller and Buyer consent to suit with
respect to this Agreement and the transaction contemplated hereby, and accept
the jurisdiction of the Superior Court for the County of Orange, California, and
the U.S. District Court for the Central District of California, and the courts
to which appeals would be taken from each of the foregoing.
11.19 Counterparts. This Agreement may be executed in counterparts, each of
which when executed shall be deemed an original and all of which counterparts
taken together shall constitute but one and the same instrument. Signature pages
may be detached from the counterparts and attached to a single copy of this
Agreement to form one document.
11.20 Notice of Special Tax. Contemporaneously with the execution of this
Agreement, Buyer shall execute the Notice of Special Tax for Community
Facilities District No. 87-7, County of Orange, California, attached hereto
after the signature page.
11.21 Aircraft Environmental Impact Declaration. Pursuant to the Conditions
of Approval imposed by the County of Orange in connection with the Pacific
Commercentre, Seller makes the following Declaration:
We make this Declaration concerning aircraft environmental impact for the
purpose and subject to the same conditions and limitations as shown in that
certain notice concerning aircraft environmental impacts recorded December 1,
1983, as Instrument No. 83-549335 in the Official Records of Orange County,
California. The Pacific Commercentre property is subject to overflight, sight
and sound of aircraft operating from El Toro Marine Corps Air Station.
11.22 Tax Deferred Exchange. Buyer agrees to reasonably cooperate with the
acquisition of other property by Seller in exchange for the sale of the Property
to Buyer in a tax deferred exchange provided that (i) the Closing is not
delayed, (ii) Buyer shall not be required to hold legal or equitable title to
any real property other than the Property, (iii) Buyer shall not be required to
assume any liability whatsoever, whether liquidated or contingent, and (iv)
Buyer will not incur any additional out-of-pocket costs in complying with this
provision.
[signature page follows]
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the date first written above.
"Buyer" Pacific Gulf Properties, Inc., a California
corporation
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇
------------------------------------------
▇▇▇▇▇▇ ▇▇▇▇▇, Senior Vice President
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
------------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Executive Vice President
"Seller" PacTel Systems, a California corporation
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Vice President
[Parties must initial ss.3.5 and ss.9.1(b) and Buyer execute
the Notice of Special Tax following this page]
Acceptance:
Fidelity Title Insurance Company
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
-----------------------------------
▇▇▇▇▇▇ ▇▇▇▇▇▇▇, Escrow Officer
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NOTICE OF SPECIAL TAX
COMMUNITY FACILITIES DISTRICT NO. 87-7
COUNTY OF ORANGE, CALIFORNIA
TO: THE PROSPECTIVE PURCHASER OF THE REAL PROPERTY KNOWN AS:
▇▇▇▇ ▇ ▇▇▇ ▇ ▇▇ ▇▇▇▇▇ ▇▇▇ ▇▇. ▇▇▇▇▇
THIS IS A NOTIFICATION TO YOU PRIOR TO YOUR ENTERING INTO A CONTRACT TO
PURCHASE THIS PROPERTY. THE SELLER IS REQUIRED TO GIVE YOU THIS NOTICE AND TO
OBTAIN A COPY SIGNED BY YOU TO INDICATE THAT YOU HAVE RECEIVED AND READ A COPY
OF THIS NOTICE.
(1) This property is subject to a special tax, which is in addition to the
regular property taxes and any other charges, fees, special taxes and benefit
assessments on the parcel. It is imposed on this property because it is a new
development, and may not be imposed generally upon property outside of this new
development. If you fail to pay this tax when due each year, the property may be
foreclosed upon and sold. The tax is used to provide public facilities or
services that are likely to particularly benefit the property. YOU SHOULD TAKE
THIS TAX AND THE BENEFITS FROM THE FACILITIES AND SERVICES FOR WHICH IT PAYS
INTO ACCOUNT IN DECIDING WHETHER TO BUY THIS PROPERTY.
(2) Since this parcel is currently Undeveloped Property, the maximum
special tax which may be levied against this parcel to pay for public facilities
and services is $10,432.69 per acre during the 1994-1995 tax year. If this
parcel was Developed Property (i.e., if a building permit had been issued by
March 1, 1994), then the maximum special tax which could have been levied
against this parcel to pay for public facilities and services during the
1994-1995 tax year would have been the greater of (a) $0.27 per square foot of
land or (b) $0.70 per square foot of improvements. This amount will be increased
by 3.5 percent per year after that. The special tax will be levied each year
until all of the authorized facilities are built and all special tax bonds are
repaid and may be levied forever thereafter to pay for ongoing service costs.
(3) The authorized facilities and fees which are being paid for by the
special taxes, and by the money received from the sale of bonds which are being
repaid by the special taxes, are:
Water and sewer acreage fees and the construction, purchase, modification,
expansion, improvement or rehabilitation of a local and regional park, fire
stations, sheriff substation, library, storm drains and the roadway improvements
to be constructed as part of the Foothill Circulation Phasing Program, which
roadway improvements include all related
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work for grading, paving, drainage, sewer and water facilities and utilities
together with improvements to intersections and other appurtenant work.
The facilities may not yet have all been constructed or acquired and it is
possible that some may never be constructed or acquired.
In addition, the special taxes may be used to pay for costs of the
following services:
Police protection, fire protection, ambulance, paramedic, flood and storm
protection, recreation program, library, park and open space services,
including, but not limited to, the operation and maintenance of storm drains,
parks and parkways.
YOU MAY OBTAIN A COPY OF THE RESOLUTION OF FORMATION WHICH AUTHORIZED
CREATION OF THE COMMUNITY FACILITIES DISTRICT AND WHICH SPECIFIES MORE PRECISELY
HOW THE SPECIAL TAX IS APPORTIONED AND HOW THE PROCEEDS OF THE TAX WILL BE USED,
FROM THE COUNTY OF ORANGE - COUNTY ADMINISTRATIVE OFFICE BY CALLING (714)
834-3055. THERE MAY BE A CHARGE FOR THIS DOCUMENT NOT TO EXCEED THE REASONABLE
COST OF PROVIDING THE DOCUMENT.
I (WE) ACKNOWLEDGE THAT I (WE) HAVE READ THIS NOTICE AND RECEIVED A COPY OF
THIS NOTICE PRIOR TO ENTERING INTO A CONTRACT TO PURCHASE OR DEPOSIT RECEIPT
WITH RESPECT TO THE ABOVE-REFERENCED PROPERTY. I (WE) UNDERSTAND THAT I (WE) MAY
TERMINATE THE CONTRACT TO PURCHASE OR DEPOSIT RECEIPT WITHIN THREE DAYS AFTER
RECEIVING THIS NOTICE IN PERSON OR WITHIN FIVE DAYS AFTER IT WAS DEPOSITED IN
THE MAIL BY GIVING WRITTEN NOTICE OF THAT TERMINATION TO THE OWNER, SUBDIVIDER
OR AGENT SELLING THE PROPERTY,
DATE: February 17, 1997 Pacific Gulf Properties, Inc., a California
corporation
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇
------------------------------------------
▇▇▇▇▇▇ ▇▇▇▇▇, Senior Vice President
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
------------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Executive Vice President
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EXHIBIT A
(Legal Description of Real Property)
▇▇▇▇ ▇ ▇▇▇ ▇ ▇▇ ▇▇▇▇▇ ▇▇. ▇▇▇▇▇, ▇▇ THE COUNTY OF ORANGE, STATE OF CALIFORNIA,
AS SHOWN ON A MAP RECORDED IN BOOK 679, PAGES 15 THROUGH 23 INCLUSIVE OF
MISCELLANEOUS MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY,
EXCEPT AN UNDIVIDED HALF INTEREST IN AND TO ANY AND ALL MINERALS, WITHOUT
LIMITATION, ALL OIL, GAS, HYDROCARBON AND SIMILAR RIGHTS, AND ALL WATER, WATER
RIGHTS, GEOTHERMAL STEAM AND STEAM POWER, WITHIN OR UNDERLYING SUCH REAL
PROPERTY, TOGETHER WITH THE PERPETUAL RIGHT OF DEVELOPMENT THEREOF; PROVIDED,
HOWEVER, THAT THE RIGHTS HEREIN CONVEYED DO NOT INCLUDE THE RIGHT TO ENTER UPON
THE SURFACE AND TOP 500 FEET OF THE SUBSURFACE OF SUCH REAL PROPERTY, AS
PROVIDED IN DEED RECORDED JULY 3, 1979 IN BOOK 13215, PAGE 646, OFFICIAL
RECORDS, AS INSTRUMENT NO. 3449.
ALSO EXCEPT AN UNDIVIDED HALF INTEREST IN AND TO ANY AND ALL MINERALS LOCATED
WITHIN THE REAL PROPERTY HEREINAFTER DESCRIBED, INCLUDING, WITHOUT LIMITATION,
ALL OIL, GAS, HYDROCARBON AND SIMILAR RIGHTS, AND ALL WATER, WATER RIGHTS,
GEOTHERMAL STEAM AND STEAM POWER, WITHIN OR UNDERLYING SUCH REAL PROPERTY,
TOGETHER WITH THE PERPETUAL RIGHT OF DEVELOPMENT THEREOF; PROVIDED, HOWEVER,
THAT THE RIGHTS HEREIN CONVEYED DO NOT INCLUDE THE RIGHT TO ENTER UPON THE
SURFACE AND TOP 500 FEET OF THE SUBSURFACE OF SAID REAL PROPERTY, AS PROVIDED IN
DEED RECORDED JULY 3, 1979 IN BOOK 13215, PAGE 649, OFFICIAL RECORDS, AS
INSTRUMENT NO. 3450.
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EXHIBIT B
RECORDING REQUESTED BY:
WHEN RECORDED RETURN TO:
-----------------------------------
-----------------------------------
-----------------------------------
--------------------------------------------------------------------------------
Transfer tax not to be shown of
public record. See attached
statement submitted herewith.
GRANT DEED
FOR VALUABLE CONSIDERATION, receipt of which is hereby acknowledged,
PacTel Systems, a California corporation ("Grantor"), hereby grants to Pacific
Gulf Properties, Inc. ("Grantee"), all that certain real property (the "Land")
located in the County of Orange, State of California, and described on Exhibit A
attached hereto and incorporated herein by this reference; subject, however, to:
(a) taxes and assessments, both general and special, not now due and payable;
(b) building and zoning ordinances, laws, regulations and restrictions by
municipal or other governmental authority; (c) any and all leases, easements,
rights-of-way, encumbrances, conditions, covenants, restrictions, reservations
and exceptions of record; and (d) all other matters affecting title to the Land,
whether or not of record including, but not limited to, road, highway, pipeline,
railroad and utility easements which would be disclosed by a survey and
inspection of the Property.
SUBJECT to Grantor's right, but not obligation, to amend the CC&R (defined
below) in order to accomplish any or all of the following ("Changes"): implement
such changes to the CC&R reasonably approved by Grantee. Grantee agrees to
cooperate with all of Grantor's efforts to make the Changes, including, if
necessary, execution of any amendment or new or additional agreement to the
CC&R; provided however, Grantee shall have the right to reasonably disapprove
any Change which either (i) pertains to the Land, or (ii) increases Grantee's
liabilities or obligations. "CC&R" means the Declaration of Covenants,
Conditions and Restrictions for Pacific Commercentre between LADCO and Pacific
Commercentre Partners, recorded on January 10, 1991, as Document No. 91-013945
in the Official Records of Orange County, California, as amended.
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FURTHER SUBJECT TO the following prohibition: Construction of a "self
storage project" on some or all of the Land is prohibited without the consent of
the owner of ▇▇▇ ▇▇ ▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ("Benefitted Lot"). Such prohibition shall
commence on September 5, 1995 and shall terminate on the later of termination of
the CC&R or March 22, 2007. The term "self storage project" means a project
having more than 10,000 gross square feet of individual storage rental units,
partitioned for the exclusive use of one tenant, with separate secure access.
Dated: ____________________, 1997. PacTel Systems, a California corporation
By:__________________________________
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Vice President
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EXHIBIT C
RECORDING REQUESTED BY:
WHEN RECORDED RETURN TO:
--------------------------------------------------------------------------------
(Space above this line for Recorder's use)
ASSIGNMENT AND ASSUMPTION AGREEMENT
This Assignment and Assumption Agreement ("Agreement") is made, as of
_______, 1997, by and between _________________________ ("Assignee"), and
PacTel Systems, a California corporation ("Assignor").
RECITALS
A. Assignor owns certain real property in Lake Forest, California described
on Exhibit A hereto (the "Property"), being a portion of that development
commonly known as Pacific Commercentre. In connection with the operation of the
Property, Assignor is a party to the certain agreements ("Contracts") described
below.
B. Assignor and Assignee entered into that certain Lot Sale Agreement dated
as of _________, 1997, ("Purchase Agreement"), pursuant to which Assignor has
agreed to sell and Assignee has agreed to purchase the Property and Assignor has
agreed to assign and Assignee has agreed to assume the Contracts.
AGREEMENT
For valuable consideration, receipt of which is acknowledged, Assignor and
Assignee agree as follows:
1. Assignor grants, sells, transfers and assigns to Assignee, as of the
date hereof, all of Assignor's right, title and interest in and to the following
contracts to the extent they relate to the development, use and operation of the
Property:
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a. Obligation to implement a transportation management program complying
with Condition of Approval No. 5, Board of Supervisors Resolution No.
87-1065, County of Orange.
b. Foothill Circulation Phasing Plan Fee Credit Agreement No. D89-294
between Pacific Commercentre Partners ("PCP") and the County of
Orange, approved June 26, 1990.
c. Fee Credit Agreement (Foothill Transportation Corridor) No. D89-305B
between the Foothill/Eastern Transportation Corridor Agency, PCP and
the County of Orange, approved July 17, 1990.
Assignee assumes, as of the date of Closing, all of Assignor's
obligations arising under, or in connection with, the Contracts to the extent
they relate to the Property, subject to the terms thereof. Assignor and Assignee
agree to execute any and all assignment and/or assumption agreements required by
public agencies to evidence Assignor's assignment and Assignee's assumption of
such obligations, and the release of Assignor from the duty to perform such
obligations from and after the date hereof. Assignee and Assignor shall
cooperate with one another in acknowledging such notices as may be required by
law in connection with the acquisition of the Property.
2. The Contracts are sold, conveyed and assigned "as is," "where is," "with
all faults" and without any warranty or representation, express or implied, of
any nature or sort, including, without limitation, any warranty of
merchantability, fitness of use for a particular purpose, or otherwise, except
as may specifically be provided otherwise in the Purchase Agreement.
3. Should either party hereto institute any legal action or proceeding to
enforce or interpret any provisions of this Agreement, the prevailing party
shall be entitled to receive from the losing party such amount as the court may
adjudge to be reasonable attorneys' fees for the services rendered to the
prevailing party in such action or proceeding.
4. This Agreement shall be binding on, and inure to the benefit of, the
parties hereto, their successors in interest and assigns, subject, however, to
the provisions of the Contracts regarding assignment.
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5. The interpretation and performance of this Agreement shall be governed
by the laws of the State of California applied to agreements to be performed
entirely within the State of California by residents of the State of California.
ASSIGNEE:
-----------------------------------
-----------------------------------
By:
--------------------------------
Name:
------------------------------
Title:
-----------------------------
ASSIGNOR:
PacTel Systems, a
California corporation
By:
--------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Vice President
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EXHIBIT D
SPECIAL TAX DISCLOSURE AGREEMENT RE COMMUNITY
FACILITIES DISTRICT NO. 87-7 OF THE COUNTY OF
ORANGE (LOS ALISOS)
THIS SPECIAL TAX DISCLOSURE AGREEMENT RE COMMUNITY FACILITIES DISTRICT NO.
87-7 OF THE COUNTY OF ORANGE (LOS ALISOS) (the "Agreement") is entered into and
is effective as of the ___ day of ______________, 1997, by and between the
COUNTY OF ORANGE, a political subdivision of the State of California (the
"County"), for itself and on behalf of Community Facilities District No. 87-7 of
the County of Orange (Los Alisos) (the "District"), and ____________________, a
___________ (the "Company").
RECITALS
A. The Board of Supervisors of the County of Orange (the "Board of
Supervisors") has formed and established the District pursuant to the provisions
of the ▇▇▇▇▇-▇▇▇▇ Community Facilities Act of 1982, Chapter 2.5 (commencing with
Section 53311) of Part 1 of Division 2 of Title 5 of the California Government
Code (the "Act"). The parties hereto acknowledge that the District has been
established as a legally constituted governmental entity pursuant to the Act.
The land included within the District is described on the map attached to
Resolution No. 88-750 adopted by the Board of Supervisors on May 24, 1988, and
subsequently recorded with the County Recorder on May 27, 1988, in Book 41, Page
14 of the maps of assessment and community facilities districts.
B. The Company owns a portion of the land within the District and
acknowledges that the land is subject to the levy of a special tax (the "Special
Tax") in accordance with the Rate and Method of Apportionment contained in
Resolution No. 88-1007 adopted by the Board of Supervisors on June 29, 1988.
C. The purpose of this Agreement is to set forth the provisions under which
the Company will provide for disclosure of the Special Tax to prospective
purchasers of its land.
AGREEMENT
NOW, THEREFORE, in consideration of the mutual promises and covenants set
forth herein, the parties hereto agree as follows:
1. Recitals. Each of the above recitals is incorporated herein and is true
and correct.
2. Disclosure of Special Tax.
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(a) In consideration of the County's and the District's willingness
to permit the financing of certain public improvements through the levy of the
Special Tax, and, in certain cases, through the issuance of bonds by the
District pursuant to the provisions of the Act, the Company agrees to provide
disclosure of the Special Tax in accordance with this Agreements, provided,
however, that nothing herein shall entitle the Company to compel the County or
the District to levy the Special Tax or issue bonds in any particular amount,
which actions shall remain within the sole discretion of the County and the
District. The Company covenants to deliver to each person or entity buying any
land or improvements within the District from the Company the disclosure notice
attached hereto as Attachment 1 and incorporated by reference herein (the
"Special Tax Notice"). In all cases, the Special Tax Notice shall be provided
prior to the opening of escrow for the purchase of any land or improvements and
shall be signed by all buyers prior to any party becoming contractually
obligated to purchase either land or improvements. The provision of the Special
Tax Notice to buyers of new homes shall be in addition to the disclosure
provided by any applicable Department of Real Estate reports. The Company shall
provide copies of the Special Tax Notices, signed by each buyer of any land or
improvements, to the County promptly upon execution by the buyer. The Company
shall include the Special Tax Notice in all of its applications for Final
Subdivision Reports required by the California Department of Real Estate.
(b) The Company covenants that, with respect to sales of real
property within the District by the Company to persons or entities who intend to
construct residential units or commercial or industrial facilities for sale, the
Company shall require as a condition precedent to its obligation to close an
escrow for the sale of real property that the buyer execute an agreement with
the County regarding disclosure of the Special Tax and that such agreement shall
be in the form of this Agreement.
3. Indemnification and Hold Harmless The Company hereby assumes the defense of,
and indemnifies and saves harmless the County, the District and each of their
respective officers, directors, employees and agents, from and against all
actions, damages, claims, losses or expenses of every type and description to
which they may be subjected or put, by reason of, or resulting form, the failure
by the Company to comply with this Agreement, provided that nothing in this
Section 3 shall be understood or construed to mean that the Company agrees to
indemnify the County or the District, or any of their respective officers,
directors, employees or agents, for any negligent or wrongful acts or omissions
to act of the County or the District, or any of their respective officers,
directors, employees or agents.
4. Governing Law. This Agreement and any dispute arising hereunder shall be
governed by and interpreted in accordance with the laws of the State of
California.
5. Waiver. Failure by a party to insist upon the strict performance of any
of the provisions of this Agreement by the other party, or the failure by a
party to exercise its rights upon the default of the other party, shall not
constitute a waiver of such party's right
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to insist and demand strict compliance by the other party with the terms of this
Agreement thereafter.
6. Singular and Plural; Gender. As used herein, the singular of any word
includes the plural, and terms in the masculine gender shall include the
feminine.
7. Counterparts. This Agreement may be executed in counterparts, each of
which shall be deemed an original. The delivery of an executed copy of this
Agreement by the Company to an escrow company shall be deemed to be an offer by
the Company to enter into this Agreement and shall be irrevocable by the Company
for a period of forty (40) days. This Agreement shall become binding upon the
County and the District upon execution by the County Administrative Officer or
his designee.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the day
and year written below.
Date: __________________, 19___
COUNTY OF ORANGE
By:
-------------------------------
County Administrative Officer
COMMUNITY FACILITIES DISTRICT
NO. 87-7 OF THE COUNTY OF
ORANGE (LOS ALISOS)
By:
-------------------------------
County Administrative Officer
APPROVED AS TO FORM:
▇▇▇▇▇▇ ▇▇▇▇▇▇,
County Counsel
By:___________________________
Dated:__________________, 19__
-------------------------------
-------------------------------
By:
----------------------------
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Attachment 1
NOTICE OF SPECIAL TAX
COMMUNITY FACILITIES DISTRICT NO. 87-7
COUNTY OF ORANGE, CALIFORNIA
TO: THE PROSPECTIVE PURCHASER OF THE REAL PROPERTY KNOWN AS:
Lot _____ of Tract Map No. _____
THIS IS A NOTIFICATION TO YOU PRIOR TO YOUR ENTERING INTO A CONTRACT TO
PURCHASE THIS PROPERTY. THE SELLER IS REQUIRED TO GIVE YOU THIS NOTICE AND TO
OBTAIN A COPY SIGNED BY YOU TO INDICATE THAT YOU HAVE RECEIVED AND READ A COPY
OF THIS NOTICE.
(1) This property is subject to a special tax, which is in addition to the
regular property taxes and any other charges, fees, special taxes and benefit
assessments on the parcel. It is imposed on this property because it is a new
development, and may not be imposed generally upon property outside of this new
development. If you fail to pay this tax when due each year, the property may be
foreclosed upon and sold. The tax is used to provide public facilities or
services that are likely to particularly benefit the property. YOU SHOULD TAKE
THIS TAX AND THE BENEFITS FROM THE FACILITIES AND SERVICES FOR WHICH IT PAYS
INTO ACCOUNT IN DECIDING WHETHER TO BUY THIS PROPERTY.
(2) Since this parcel is currently Undeveloped Property, the maximum
special tax which may be levied against this parcel to pay for public facilities
and services is $10,432.69 per acre during the 1994-1995 tax year. If this
parcel was Developed Property (i.e., if a building permit had been issued by
March 1, 1994), then the maximum special tax which could have been levied
against this parcel to pay for public facilities and services during the
1994-1995 tax year would have been the greater of (a) $0.27 per square foot of
land or (b) $0.70 per square foot of improvements. This amount will be increased
by 3.5 percent per year after that. The special tax will be levied each year
until all of the authorized facilities are built and all special tax bonds are
repaid and may be levied forever thereafter to pay for ongoing service costs.
(3) The authorized facilities and fees which are being paid for by the
special taxes, and by the money received from the sale of bonds which are being
repaid by the special taxes, are:
Water and sewer acreage fees and the construction, purchase, modification,
expansion, improvement or rehabilitation of a local and regional park, fire
stations, sheriff substation, library, storm drains and the roadway improvements
to be constructed as part of the
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Foothill Circulation Phasing Program, which roadway improvements include all
related work for grading, paving, drainage, sewer and water facilities and
utilities, together with improvements to intersections and other appurtenant
work.
The facilities may not yet have all been constructed or acquired and it is
possible that some may never be constructed or acquired.
In addition, the special taxes may be used to pay for costs of the
following services:
Police protection, fire protection, ambulance, paramedic, flood and storm
protection, recreation program, library, park and open space services,
including, but not limited to, the operation and maintenance of storm drains,
parks and parkways.
YOU MAY OBTAIN A COPY OF THE RESOLUTION OF FORMATION WHICH AUTHORIZED
CREATION OF THE COMMUNITY FACILITIES DISTRICT AND WHICH SPECIFIES MORE PRECISELY
HOW THE SPECIAL TAX IS APPORTIONED AND HOW THE PROCEEDS OF THE TAX WILL BE USED,
FROM THE COUNTY OF ORANGE - COUNTY ADMINISTRATIVE OFFICE BY CALLING (714)
834-3055. THERE MAY BE A CHARGE FOR THIS DOCUMENT NOT TO EXCEED THE REASONABLE
COST OF PROVIDING THE DOCUMENT.
I (WE) ACKNOWLEDGE THAT I (WE) HAVE READ THIS NOTICE AND RECEIVED A COPY
OF THIS NOTICE PRIOR TO ENTERING INTO A CONTRACT TO PURCHASE OR DEPOSIT RECEIPT
WITH RESPECT TO THE ABOVE-REFERENCED PROPERTY. I (WE) UNDERSTAND THAT I (WE) MAY
TERMINATE THE CONTRACT TO PURCHASE OR DEPOSIT RECEIPT WITHIN THREE DAYS AFTER
RECEIVING THIS NOTICE IN PERSON OR WITHIN FIVE DAYS AFTER IT WAS DEPOSITED IN
THE MAIL BY GIVING WRITTEN NOTICE OF THAT TERMINATION TO THE OWNER, SUBDIVIDER
OR AGENT SELLING THE PROPERTY.
DATE: [EFFECTIVE DATE] -------------------------------
-------------------------------
By:____________________________
Name:__________________________
Title:_________________________
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EXHIBIT E
GENERAL ESCROW INSTRUCTIONS
The following instructions to Escrow Holder are applicable:
1. Escrow Holder shall prorate all items as of the Closing Date, assuming a
30 day month, using the information contained in the last available tax
statement without regard to any reassessments or subsequent changes, and
association statements delivered into escrow for proration purposes.
2. If any check submitted to escrow is dishonored when presented for
payment, Escrow Holder shall notify Buyer and Seller of such non payment.
3. All funds delivered to Escrow shall be deposited with other escrow funds
in a general escrow account or accounts of Escrow Holder with any state or
national bank. Escrow Holder shall have no obligation to account for the value
of any escrow-related accounting services and incidental benefits that may be
provided to Escrow Holder by any depository bank. All disbursements shall be
made by Escrow Holder check, unless otherwise instructed. Escrow Holder shall
not be responsible for any delay in closing if funds received by Escrow Holder
are not available for immediate withdrawal.
4. The phrase "close of escrow" (or ▇▇▇) as used in this Exhibit means the
date on which documents are recorded, unless otherwise specified.
5. Recordation of any instruments delivered through escrow, if necessary or
proper for the issuance of the policy of title insurance called for, is
authorized.
6. No examination or insurance as to the amount or payment of personal
property taxes is required.
7. If a demand to cancel escrow is submitted after the Closing Date, the
party so requesting Escrow Holder to cancel escrow shall file notice of demand
to cancel in Escrow Holder's office in writing. Escrow Holder shall within three
(3) Business Days thereafter mail by certified mail one copy of such notice to
each of the other parties.
8. In the event Escrow Holder receive or become aware of any conflicting
demands or claims with respect to the escrow or the rights of any of the parties
hereto, or any money or property deposited herein, Escrow Holder shall have the
absolute right at its option to discontinue any or all further acts until such
conflict is resolved.
9. Escrow Holder is released from and shall have no liability, obligation
or responsibility with respect to: withholding of funds pursuant to Section 1445
of the Internal Revenue Code of 1954 as amended, and to Sections 18805 and 26131
of the California Revenue and Taxation
1
39
Code; advising the parties as to the requirements of Section 1445; determining
whether the transferor is a foreign person or a non-resident under such
Sections; or obtaining a non foreign affidavit or other exemption from
withholding under said Sections nor otherwise making any inquiry concerning
compliance with such Sections by any party to the transaction.
10. Escrow Holder is authorized to destroy or otherwise dispose of any and
all documents, papers, instructions, correspondence and other material
pertaining to this escrow at the expiration of six years (6) from the close of
escrow or cancellation thereof, without liability and without further notice.
11. Buyer and Seller acknowledge that Escrow Holder does not provide legal
advice nor has it made any investigation, representations or assurances
whatsoever regarding the legal aspects or compliance of this transaction with
any tax, securities or other state or federal laws. It is recommended that the
parties obtain independent legal counsel as to such matters.
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40
Exhibit F
RECORDING REQUESTED BY:
WHEN RECORDED RETURN TO:
Pacific Commercentre Owners Association
c/o Makena Properties
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇., ▇▇▇▇▇ ▇▇▇
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇
--------------------------------------------------------------------------------
(Space above provided for Recorder's use only)
SUPPLEMENT TO EXHIBIT C-1
OF DECLARATION OF COVENANTS,
CONDITIONS AND RESTRICTIONS
This Supplement to Exhibit C-1 of Declaration of Covenants, Conditions and
Restrictions is made as of _______________, 1997, by PacTel Systems, a
California corporation ("Declarant"), as follows:
1. Declarant is the sole owner of certain real property described on
attached Exhibit A ("Reallocated Lots"), a portion of the property covered by
that certain Declaration of Covenants, Conditions and Restrictions for Pacific
Commercentre recorded January 10, 1991, in the Official Records of Orange
County, California, as Document No. 91-013945 (as amended, "CC&R").
2. Pursuant to Article VI, Section 1, of the CC&R, the net usable building
area of Parcels (as defined in the CC&R) may be reallocated, from time to time,
among such Parcels, which reallocation will be effective upon the recordation of
a supplement to Exhibit C-1 to the CC&R setting forth the revised net usable
building areas for the Parcels, signed by the owners of all Parcels affected.
3. Declarant hereby reallocates the net usable building area of the
Reallocated Lots as follows:
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇. ▇▇▇▇
------------------ ---------------------
Tract 14316, ▇▇▇ ▇ ▇▇▇,▇▇▇
▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ 6 57,673
Tract _____, Lot
PacTel Systems, a California corporation
By:
---------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Vice President
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FIRST AMENDMENT TO LOT SALE AGREEMENT
-------------------------------------
[Lots 6 and 7]
This First Amendment to Lot Sale Agreement ("Amendment"), dated as of
April 21, 1997, is made between PacTel Systems, a California corporation
("Seller"), and Pacific Gulf Properties, Inc., a California corporation
("Buyer"), with respect to the Lot Sale Agreement by and between Buyer and
Seller dated as of February 17, 1997 ("Agreement"). All capitalized terms not
otherwise defined herein shall have the meaning ascribed in the Agreement. For
good and valuable consideration, the parties agree to amend the Agreement as
follows:
1. The Purchase Price is increased from Three Million Four Hundred
Ninety Eight Thousand Three Hundred Four Dollars ($3,498,304) by $18,067 to
Three Million Five Hundred Sixteen Thousand Three Hundred Seventy One Dollars
($3,516,371).
2. The Closing Date is changed to May 29, 1997.
3. Except as amended by this Amendment, the Agreement shall remain
unmodified and in full force and effect. This Amendment may be executed in
multiple counterparts, each of which shall constitute an original, but all of
which shall constitute one and the same document.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
duly executed as of the date first written above.
"Buyer" Pacific Gulf Properties, Inc., a California corporation
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇
---------------------------------------------------
▇▇▇▇▇▇ ▇▇▇▇▇, Senior Vice President
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
---------------------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Executive Vice President
"Seller" PacTel Systems, a California corporation
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Vice President