Resolution No. 89931
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RESOLUTION NO. 8993
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
VERNON APPROVING AND AUTHORIZING THE EXECUTION OF A
STANDARD OFFER, AGREEMENT AND ESCROW INSTRUCTIONS
AND ADDENDUM FOR THE PURCHASE BY AND BETWEEN THE
CITY OF VERNON AND ALPINE UNIVERSAL, INC. FOR
PROPERTY LOCATED AT 2301 E. VERNON AVENUE
WHEREAS, the City of Vernon desires to sell certain real
property in the City consisting of approximately 134,650 square feet of
various industrial buildings located on approximately 263,102 square
feet of industrial land, commonly known as 2301 E. Vernon Avenue in the
City of Vernon (the "Property") to Alpine Universal, Inc. ("Alpine")
for approximately $8,350,000.00 for future development; and
WHEREAS, the City has agreed to sell the Property to Alpine
on negotiated terms, which the City has determined to be fair and
treasonable; and
WHEREAS, City staff have recommended that the Property be
sold and the necessary documents executed to implement the sale.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE
CITY OF VERNON AS FOLLOWS:
SECTION 1: The City Council of the City of Vernon hereby
finds and determines that the recitals contained hereinabove are true
land correct.
SECTION 2: The City Council of the City of Vernon hereby
approves the Standard Offer, Agreement and Escrow Instructions for
Purchase of Real Estate and Addendum to Standard Offer, Agreement and
Escrow Instructions for Purchase of Real Estate with Alpine, a copy of
which is attached hereto as Exhibit A and incorporated by
1 reference.
2 SECTION 3: The City Council of the City of Vernon hereby
3 authorizes the Mayor to execute the Agreement and Addendum for, and on
4 behalf of, the City of Vernon and the Acting City Clerk is hereby
5 authori.zed to attest thereto.
6 SECTION 4: The City Council of the City of Vernon hereby
7 authorizes the Acting City Clerk, or his designee, to execute any and
8 all documents as shall be required to complete the sale of the
9 Property and to accomplish the close of escrow consistent with the
10 terms of said Agreement and Addendum approved herein.
11 SECTION 5: The Acting City Clerk of the City of Vernon
12 shall certify to the passage of this resolution, and thereupon and
13 thereafter the same shall be in full force and effect.
14 APPROVED AND ADOPTED this 22Id day of March, 2006.
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17 LEONIS C. MA BURG, Mayor
18 ATTEST:
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21 BRUCE V. MALKENHORST, JR., Acting City Clerk
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STATE OF CALIFORNIA )
) ss
COUNTY OF LOS ANGELES )
I, BRUCE V. MALKENHORST, JR., Acting City Clerk of the City of
Vernon, do hereby certify that the foregoing Resolution, being
Resolution No. 8993, was duly adopted by the City Council of the City
of Vernon at a regular meeting of the City Council duly held on
Wednesday, March 22, 2006, and thereafter was duly signed by the Mayor
of the City of Vernon.
BRUCE MALKENHORST, JR.
Acting City Clerk
(SEAL)
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EXHIBIT
A
STANDARD OFFER, AGREEMENT AND ESCROW
INSTRUCTIONS FOR PURCHASE OF REAL ESTATE
(Non -Residential)
March 6, 2006
(Date for Reference Purposes)
1. Buyer
1.1 Alpine Universal, Inc., a California corporation (`Buyer") hereby offers to purchase the real
property, hereinafter described, from the City of Vernon ("Seller") (collectively, the "Parties" or individually, a
"Party"), through an escrow ("Escrow") to close on a date mutually agreed to by the Parties that is on or before
30 days after the expiration of the Contingency Period ("Closing Date"). The Closing shall be held by North
American Title Company (Attn: Tina De Bow) ("Escrow Holder") whose address is 520 North Brand Blvd.,
Glendale, California 91203, Phone No. 818-551-5370, Facsimile No. 818-240-9884, upon the terms and
conditions set forth in this agreement ("Agreement").
1.2 The term "Date of Agreement" shall be the date when by execution and delivery of this document
or a subsequent counteroffer thereto, Buyer and Seller have reached agreement in writing whereby Seller agrees
to sell, and Buyer agrees to purchase, the Property upon terms accepted by both Parties.
2. Property
2.1 The real property ("Property") that is the subject of this offer consists of the property located at
2301 E. Vernon Avenue, City of Vernon, State of California, consisting of approximately 134,650 square feet
of various industrial buildings located on approximately 263,102 square feet of industrial land, with the APN to
be determined in Escrow.
2.2 The legal description of the Property shall be completed to meet the requirements of North American
Title (Attn: Mr. Victor Greene) ("Title Company"), which shall issue the title policy hereinafter described.
2.3 The Property shall be delivered with all existing improvements in their current "as is" condition.
3. Purchase Price
3.1 The purchase price ("Purchase Price") to be paid by Buyer to Seller for the Property shall be
$8,350,000.00, and there shall be no adjustment to the Purchase Price, regardless of actual size of property or
square footage of buildings, all of which are acknowledged to be estimates. The Purchase Price shall be
payable all cash at the Closing, provided, however, that the Deposit, as defined below, shall be applied to the
Purchase Price at the Closing. There is no loan contingency.
4. Deposits
4.1 Within two business days following the mutual execution of this Agreement, Buyer will deliver to
Escrow Holder by wire transfer the sum of Two Hundred Thousand Dollars ($200,000 (the "Deposit"), along
with an executed copy of this Agreement.
4.2 Escrow Holder shall deposit the funds deposited with it by Buyer pursuant to Paragraph 4.1 in a
State or Federally chartered bank in an interest -bearing account whose term is appropriate and consistent with
the timing requirements of this transaction. The interest therefrom shall accrue to the benefit of Buyer, who
hereby acknowledges that there may be penalties or interest forfeitures if the applicable instrument is redeemed
prior to its specified maturity; provided, however, that if the Seller retains the Deposit as liquidated damages,
the liquidated damages shall include the interest. Buyer's Federal Tax Identification Number is
NOTE: Such interest bearing account cannot be opened until Buyer's Federal Tax Identification number is
provided.
4.3 After the last day of the Due Diligence Period, the Deposit shall be non-refundable to Buyer, but
shall be fully applicable to the Purchase Price.
5. Real Estate Brokers
Buyer and Seller are both represented by Cushman & Wakefield of California, Inc. ("Broker"). Buyer and
Seller each represent and warrant to the other that, except for Broker, the Buyer and Seller have had no dealings
with any person, firm, broker or finder in connection with the negotiation of this Agreement or the
consummation of the purchase and sale contemplated herein, and no broker or other person, firm or entity, is/are
entitled to any commission or finder's fee in connection with this transaction as the result of any dealings or
acts of such Party. Buyer and Seller each hereby agree to indemnify, defend, protect and hold the other
harmless from and against any costs, expenses or liability for compensation, commission or charges which may
be claimed by any broker, finder or other similar party by reason of any dealings or act of the indemnifying
Party, except for Seller's obligation to compensate Broker in accordance with the terms of a separate agreement
between Seller and Broker, which commission shall be payable out of the Escrow if and only if there is a
Closing.
6. Escrow and Closing
6.1 Upon acceptance hereof by Seller, this Agreement, including any counteroffers incorporated herein
by the Parties, shall constitute not only the agreement of purchase and sale between Buyer and Seller, but also
instructions to Escrow Holder for the consummation of the Agreement through the Escrow. Escrow Holder
shall not prepare any further escrow instructions restating or amending the Agreement unless specifically so
instructed by the Parties. Subject to the reasonable approval of the Parties, Escrow Holder may, however,
include its standard general escrow provisions; provided, however, that in the event of a conflict between the
terms of this Agreement, and Escrow Holder's instructions, the terms of this Agreement shall control.
6.2 As soon as practical after the receipt of this Agreement and any relevant counteroffers, Escrow
Holder shall ascertain the Date of Agreement as defined in Paragraph 1.2 and advise the Parties, in writing, of
the date ascertained. Escrow Holder is hereby authorized and instructed to conduct the Escrow in accordance
with this Agreement, applicable law and custom and practice of the community in which Escrow Holder is
located, including any reporting requirements of the Internal Revenue Code.
6.3 Subject to satisfaction or waiver of the Buyer's Contingencies, Escrow Holder shall close this
Escrow (the "Closing") by recording a grant deed and the other documents required to be recorded, and by
disbursing the funds and documents in accordance with this Agreement.
6.4 Buyer and Seller shall each pay one-half of the Escrow Holder's charges and Seller shall pay the
usual recording fees and any required documentary transfer taxes. Seller shall pay the premium for a standard
coverage owner's or joint protection policy of title insurance. Buyer shall pay for any additional endorsements
or ALTA coverage, if obtained by Buyer.
6.5 Escrow Holder shall verify that all of Buyer's Contingencies have been satisfied or waived prior to
Closing.
6.6 If this transaction is terminated for non -satisfaction and non -waiver of a Buyer's Contingency, as
defined in Paragraph 7.1, then neither of the Parties shall thereafter have any liability to the other under this
Agreement, except to the extent of a breach of any affirmative covenant or warranty in this Agreement. In the
event of such termination, Buyer shall be promptly refunded all funds deposited by Buyer with Escrow Holder,
less only Title Company and Escrow Holder cancellation fees and costs, all of which shall be Buyer's
obligation.
6.7 The Closing shall occur on the Closing Date, or as soon thereafter as the Escrow is in condition for
Closing; provided, however, that if the Closing does not occur within 5 days after the Closing Date and said
Date is not extended by mutual instructions of the Parties, a Party not then in default under this Agreement may
notify the other Party and Escrow Holder, in writing that, unless the Closing occurs within 5 days following said
notice, the Escrow shall be deemed terminated without further notice or instructions.
6.8 Except as otherwise provided herein, the termination of Escrow shall not relieve or release either
Party from any obligation to pay Escrow Holder's fees and costs or constitute a waiver, release or discharge of
any breach or default that has occurred in the performance of the obligations, agreements, covenants or
warranties contained therein.
6.9 If this Escrow is terminated for any reason other than Seller's breach or default, then at Seller's
request, and as a condition to the return of Buyer's deposit, Buyer shall within 5 business days after written
request deliver to Seller, at no charge, copies of all surveys, engineering studies, soil reports, maps, master
plans, feasibility studies and other similar items prepared by or for Buyer that pertain to the Property.
6.10 If this Escrow does not close as a result of Seller's failure to deliver the documents required to close
the Escrow, the Deposit shall be refunded to Buyer.
7. Contingencies to Closing
7.1 The Closing of this transaction is contingent upon the satisfaction or waiver of the following
contingencies and any other matter in the sole discretion of Buyer. Buyer may terminate this Agreement and
cancel the Escrow if Buyer disapproves, at Buyer's sole discretion, of any item during the Due Diligence Period
("Buyer's Contingencies") IF BUYER FAILS TO NOTIFY ESCROW HOLDER AND SELLER, IN
WRITING, OF THE DISAPPROVAL OF ANY OF BUYER'S CONTINGENCIES WITHIN THE TIME
SPECIFIED HEREIN, IT SHALL BE CONCLUSIVELY PRESUMED THAT BUYER HAS APPROVED
SUCH ITEM, MATTER OR DOCUMENT. Buyer's conditional approval shall constitute disapproval, unless
provision is made by the Seller within the time specified therefor by the Buyer in such conditional approval or
by this Agreement, whichever is later, for the satisfaction of the condition imposed by the Buyer. Escrow
Holder shall promptly provide all parties with copies of any written disapproval or conditional approval which it
receives. Buyer's period for approval or disapproval of the Buyer's Contingencies set forth in Paragraph 7 shall
end at 5:00 P.M., California time, on the 30 calendar day after the Date of Agreement (which 30 day period
shall be extended to the next business day if it ends on a Friday, weekend, or holiday) (the "Due Diligence
Period").
(a) Disclosure. Seller shall make to Buyer, through Escrow, all of the applicable disclosures
required by law (per AIR Commercial Real Estate Association ("AIR") standard form entitled "Seller's
Mandatory Disclosure Statement") and provide Buyer with a completed Property Information Sheet ("Property
Information Sheet") concerning the Property, duly executed by or on behalf of Seller in the current form or
equivalent to that published by the AIR, within 7 business days following the Date of Agreement. All
disclosures set forth in the Seller's Mandatory Disclosure Statement and the Property Information Sheet shall be
true and correct to the current actual knowledge of Kevin Wilson, the Director of Community Services, without
duty of investigation. Seller shall deliver to Buyer a report paid for by Seller and prepared by a professional
provider containing the Natural Hazard Disclosures concerning the Property. Unless otherwise noted by Seller
to Buyer in writing, Seller is unaware of any inaccuracies in the Natural Hazard Disclosures. Buyer
acknowledges receipt of the following, which were delivered to Buyer, through Broker, prior to the execution of
this Agreement: Certificate of Closure signed by the City's Health Department; an ALTA survey obtained by
Seller when it purchased the Property in August 2004; and the title report delivered to Seller by the Title
Company when Seller purchased the Property in August 2004. All reports, permits, plans, drawings, designs,
and other documents related to the physical condition of the Property and any improvements located on the
Property (other than reports related to environmental conditions) in the possession of the Seller are located at
the Department of Community Services at Vernon City Hall, and all reports, analyses, studies, and other
documents related to the environmental condition of the Property in the possession of the Seller are located at
the Health Department at Vernon City Hall. All of such documents may be inspected and reviewed during the
City of Vernon's standard hours for counter service, and a reasonable number of documents selected by Buyer
will be copied by the City of Vernon for Buyer's files, subject to the terms of Paragraph 10.4 below.
(b) Physical Inspection. Buyer has 60 days from the Date of Agreement to satisfy itself with
regard to the physical aspects and size of the Property.
(c) Hazardous Substance Conditions Report. Buyer has 60 days from the Date of Agreement to
satisfy itself with regard to the environmental aspects of the Property. Seller recommends that Buyer obtain a
Hazardous Substance Conditions Report concerning the Property and relevant adjoining properties. Any such
report shall be paid for by Buyer. A "Hazardous Substance" for purposes of this Agreement is defined as any
substance whose nature and/or quantity of existence, use, manufacture, disposal or effect, render it subject to
Federal, state or local regulation, investigation, remediation or removal as potentially injurious to public health
or welfare. A "Hazardous Substance Condition" for purposes of this Agreement is defined as the existence
on, under or relevantly adjacent to the Property of a Hazardous Substance that would require remediation and/or
removal under applicable Federal, state or local law.
(d) Soil Inspection. Buyer has 60 days from the Date of Agreement to satisfy itself with regard to
the condition of the soils on the Property. Seller recommends that Buyer obtain a soil test report. Any such
report shall be paid for by Buyer.
(e) Governmental Approvals. Buyer has 60 days from the Date of Agreement to satisfy itself with
regard to approvals and permits from governmental agencies or departments which have or may have
jurisdiction over the Property and which Buyer deems necessary or desirable in connection with its intended use
of the Property, including, but not limited to, permits and approvals required with respect to zoning, planning,
building and safety, fire, police, handicapped and Americans with Disabilities Act requirements, transportation
and environmental matters.
(r) Conditions of Title. Escrow Holder shall cause a preliminary title report ("Title Report")
concerning the Property issued by the Title Company, as well as legible copies of all documents referred to in
the Title Commitment ("Underlying Documents") to be delivered to Buyer within 15 calendar days following
the Date of Agreement. Buyer has 60 days from the Date of Agreement to satisfy itself with regard to the
condition of title. The disapproval of Buyer of any monetary encumbrance shall not be considered a failure of
this contingency, as Seller shall have the obligation, at Seller's expense, to satisfy and remove such disapproved
monetary encumbrance at or before the Closing.
(g) Survey. Seller has delivered to Buyer, without warranty, the ALTA survey that Seller obtained
when it purchased the Property in August 2004. Buyer shall have 60 days from the Date of Agreement to
approve the survey provided by Seller or obtain and approve its own ALTA survey. Buyer may elect within
the period allowed for Buyer's approval of a survey to have an ALTA extended coverage owner's form of title
policy, in which event Buyer shall pay any additional premium attributable thereto.
(h) Other Agreements. Seller shall within 7 business days from the Date of Agreement provide
Buyer with legible copies of all other agreements ("Other Agreements") readily available to Seller that will
affect the Property after Closing. Buyer has 60 days from the Date of Agreement to satisfy itself with regard to
such Agreements.
(i) Seller Performance. The delivery of all documents and the due performance by Seller of each
and every undertaking and agreement to be performed by Seller under this Agreement.
0) Warranties. That each representation and warranty of Seller herein be true and correct as of
the Closing. Escrow Holder shall assume that this condition has been satisfied unless notified to the contrary in
writing by any Party prior to the Closing.
7.2 All of the contingencies specified in the sub -paragraphs of Paragraph 7.1 are for the benefit of, and
may be waived by, Buyer.
7.3 If any Buyer's Contingency or any other matter subject to Buyer's approval is disapproved as
provided for herein in a timely manner ("Disapproved Item"), Seller shall have the right within 10 days
following the receipt of notice of Buyer's disapproval to elect to cure such Disapproved Item prior to the
Closing Date ("Seller's Election"), Seller's failure to give to Buyer within such period, written notice of
Seller's commitment to cure such Disapproved Item on or before the Closing Date shall be conclusively
presumed to be Seller's Election not to cure such Disapproved Item. If Seller elects, either by written notice or
failure to give written notice, not to cure a Disapproved Item, Buyer shall have the election, within 10 days after
Seller's Election to either accept title to the Property subject to such Disapproved Item, or to terminate this
transaction. Buyer's failure to notify Seller in writing of Buyer's election to accept title to the Property subject
to the Disapproved Item without deduction or offset shall constitute Buyer's election to terminate this
transaction. Unless expressly provided otherwise herein, Seller's right to cure shall not apply to the remediation
of Hazardous Substance Conditions. Unless the Parties mutually instruct otherwise, if the time periods for the
satisfaction of contingencies or for Seller's and Buyer's said Elections would expire on a date after the Closing
Date, the Closing Date shall be deemed extended for 5 business days following the expiration of. (a) the
applicable contingency period(s), (b) the period within which the Seller may elect to cure the Disapproved Item,
or (c) if Seller elects not to cure, the period within which Buyer may elect to proceed with this transaction,
whichever is later.
7.4 The Parties acknowledge that extensive local, state and Federal legislation establish broad liability
upon owners and users of real property for the investigation and remediation of Hazardous Substances. The
determination of the existence of a Hazardous Substance Condition and the evaluation of the impact of such a
condition are highly technical. The Buyer acknowledges that it has been advised by Seller to consult its own
technical and legal experts with respect to the possible presence of Hazardous Substances on the Property or
adjoining properties, and Buyer is not relying upon any investigation by or statement of Seller with respect
thereto. Buyer assumes all responsibility for the impact of such Hazardous Substances.
s. Documents Required at or before Closing:
8.1 By the Closing date Escrow Holder shall obtain an updated Title Report concerning the Property
from the Title Company and provide copies thereof to each of the Parties.
8.2 Seller shall deliver to Escrow Holder in time for delivery to Buyer at the Closing:
(a) Grant deed, duly executed and in recordable form, conveying fee title to the Property to Buyer.
(b) An affidavit executed by Seller to the effect that Seller is not a "foreign person" within the
meaning of Internal Revenue Code Section 1445 or successor statutes. If Seller does not provide such affidavit
in form reasonably satisfactory to Buyer at least 3 business days prior to the Closing, Escrow Holder shall at the
Closing deduct from Seller's proceeds and remit to Internal Revenue Service such sum as is required by
applicable Federal law with respect to purchases from foreign sellers.
(c) An affidavit executed by Seller to the effect that Seller is not a "nonresident" within the
meaning of California Revenue and Tax Code Section 18662 or successor statutes. If Seller does not provide
such affidavit in form reasonably satisfactory to Buyer at least 3 business days prior to the Closing, Escrow
Holder shall at the Closing deduct from Seller's proceeds and remit to the Franchise Tax Board such sum as is
required by such statute.
8.3 Buyer shall deliver to Seller through Escrow:
(a) The cash portion of the Purchase Price and such additional sums as are required of Buyer under
this Agreement shall be deposited by Buyer with Escrow Holder, by federal funds wire transfer, or any other
method acceptable to Escrow Holder as immediately collectable funds, no later than 2:00 P.M. on the business
day prior to the Closing Date.
(b) A duly executed corporate resolution authorizing the execution of this Agreement and the
purchase of the Property.
8.4 At Closing, Escrow Holder shall cause to be issued to Buyer a standard coverage (or ALTA
extended, if elected) owner's form policy of title insurance effective as of the Closing, issued by the Title
Company in the full amount of the Purchase Price, insuring title to the Property vested in Buyer, subject only to
the exceptions approved by Buyer. In the event there is a Purchase Money Deed of Trust in this transaction, the
policy of title insurance shall be a joint protection policy insuring both Buyer and Seller.
s. Prorations and Adjustments.
9.1 Taxes. Applicable real property taxes and special assessment bonds shall be prorated through
Escrow as of the date of the Closing, based upon the latest tax bill available. The Parties agree to prorate as of
the Closing any taxes assessed against the Property by supplemental bill levied by reason of events occurring
prior to the Closing. Payment of the prorated amount shall be made promptly in cash upon receipt of a copy of
any such supplemental bill.
9.2 Insurance. WARNING: Any insurance which Seller may have maintained will terminate on the
Closing. Buyer is advised to obtain appropriate insurance to cover the Property.
9.3 Expenses. Utilities and operating expenses shall be prorated as of the date of Closing.
10. Representations and Warranties of Seller and Disclaimers.
10.1 Buyer acknowledges that Seller has recently acquired the Property, and has not used or operated any
business on the Property, and has no actual knowledge of the condition of the Property. Buyer further
acknowledges that it is purchasing the Property solely for its land value, and therefore the condition of any
improvements on the Property are of no interest to Buyer. Buyer is relying solely and exclusively on its own
knowledge of the condition of the Property and its own inspections, if any, and waives any claims against Seller
for any faults or defects on the Property or any Hazardous Substance that may be in, on, under, or around the
Property. Seller has not made any representation or warranty as to the "Property Condition". "Property
Condition" means and refers to each and every matter of concern or relevance to Buyer relating to the Property,
including, without limitation, the financial, legal, title, physical, geological and environmental condition and
sufficiency of the Property; applicable governmental laws, regulations, and zoning, building codes, and the
extent to which the Property complies therewith; the fitness of the Property for Buyer's contemplated use; the
presence of Hazardous Substances; and the value of the Property. Seller hereby makes only the following
warranties and representations to Buyer:
Authority of Seller. Seller is the owner of the Property and/or has the full right, power and authority to sell,
convey and transfer the Property to Buyer as provided herein, and to perform Seller's obligations hereunder.
10.2 Buyer hereby acknowledges that Buyer is purchasing the Property in its current "AS IS" condition,
with all faults and that Buyer will, by the time called for herein, make or have waived all inspections of the
Property that Buyer believes are necessary to protect its own interest in, and its contemplated use of, the
Property. The Parties acknowledge that, except as specifically set forth in this Agreement, no representations,
inducements, promises, agreements, assurances, oral or written, concerning the Property, the value of the
Property, or any aspect of the Property, Hazardous Substance laws, or any other act, ordinance or law, have
been made by either Party or Seller, or relied upon by Buyer. Seller has no obligation to repair, correct or
compensate Buyer for any Property Condition.
10.3 In the event that Buyer learns that a Seller representation or warranty might be untrue prior to the
Closing, and Buyer elects to purchase the Property anyway then, and in that event, Buyer waives any right that
it may have to bring an action or proceeding against Seller regarding said representation or warranty.
10.4 Any environmental reports, soils reports, surveys, demolition reports, reports of the condition of the
Property and any improvements located thereon and other similar documents which were prepared by third
party consultants and made available to Buyer for inspection and review have been made available as an
accommodation to Buyer and without any representation or warranty as to the sufficiency, accuracy,
completeness, or validity of said documents, all of which Buyer relies on at its own risk.
10.5 Upon Closing, Buyer shall be deemed to have waived any and all objections to the Property
Condition, whether or not known to Buyer. Upon Closing, Buyer hereby waives, releases, acquits, and forever
discharges Seller, and Seller's agents, beneficiaries, heirs, successors, and assigns to the maximum extent
permitted by law from any and all claims, actions, causes of action, demands, rights, liabilities, damages, costs
(including, without limitation, reasonable attorneys' fees and costs), losses, 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 related to or in connection with the Property Condition. BUYER
EXPRESSLY WAIVES ANY RIGHTS OR BENEFITS IT MAY HAVE 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.
Buyer's Initials Seller's Initials
11. Possession.
Possession of the Property shall be given to Buyer at the Closing.
12. Further Documents and Assurances.
The Parties shall each, diligently and in good faith, undertake all actions and procedures reasonably
required to place the Escrow in condition for Closing as and when required by this Agreement. The Parties
agree to provide all further information, and to execute and deliver all further documents, reasonably required
by Escrow Holder or the Title Company.
13. Attorneys' Fees.
If any Party brings an action or proceeding (including arbitration) involving the Property whether founded
in tort, contract or equity, or to declare rights hereunder, the Prevailing Party (as hereafter defined) in any such
proceeding, action, or appeal thereon, shall be entitled to reasonable attorneys' fees. Such fees may be awarded
in the same suit or recovered in a separate suit, whether or not such action or proceeding is pursued to decision
or judgment. The term, "Prevailing Party" shall include, without limitation, a Party who substantially obtains
or defeats the relief sought, as the case may be, whether by compromise, settlement, judgment, or the
abandonment by the other Party of its claim or defense. The attorneys' fees award shall not be computed in
accordance with any court fee schedule, but shall be such as to fully reimburse all attorneys' fees reasonably
incurred.
14. Prior Agreements/Amendments.
14.1 This Agreement is the entire agreement between the parties as to the matters described herein, and
supersedes any and ail prior negotiations, discussions, writings, documents, and agreements, whether oral or
written, between Seller and Buyer regarding the Property or the transactions contemplated by this Agreement.
14.2 Amendments to this Agreement are effective only if made in writing and executed by Buyer and
Seller.
15. Notices.
15.1 Whenever any Party or Escrow Holder shall desire to give or serve any notice, demand, request,
approval, disapproval or other communication, each such communication shall be in writing and shall be
delivered personally, by messenger or by mail, postage prepaid, or by overnight courier, to the address set forth
in this Agreement or by facsimile transmission.
15.2 Service of any such communication shall be deemed made on the date of actual receipt or refusal to
accept delivery. Communications transmitted by facsimile transmission shall be deemed delivered upon
telephonic confirmation of receipt (confirmation report from fax machine is sufficient), provided a copy is also
delivered via delivery or mail. If such communication is received on a Friday, Saturday, Sunday or legal
holiday, it shall be deemed received on the next business day.
15.3 Any Party hereto may from time to time, by notice in writing, designate a different address to which,
or a different person or additional persons to whom, all communications are thereafter to be made.
16. Duration of Offer.
16.1 If a signed copy of this offer (with Paragraphs 10.5 and 17 and 26 initialed) is not received by Seller
on or before 7:00 P.M. according to the time standard applicable to the city of Los Angeles on the date of
2006 it shall be deemed automatically revoked, and if Seller has not signed this offer by
5:00 P.M. on , 2006 it shall be deemed automatically revoked.
16.2 The acceptance of this offer, or of any subsequent counter offer hereto, that creates an agreement
between the Parties as described in Paragraph 1.2, shall be deemed made upon delivery to the other Party of a
duly executed writing unconditionally accepting the last outstanding offer or counteroffer.
17. LIQUIDATED DAMAGES. (This Liquidated Damages paragraph is applicable only if initialed by both
parties)
THE PARTIES AGREE THAT IT WOULD BE IMPRACTICABLE OR EXTREMELY DIFFICULT TO
FIX, PRIOR TO SIGNING THIS AGREEMENT, THE ACTUAL DAMAGES WHICH WOULD BE
SUFFERED BY SELLER IF BUYER FAILS TO PERFORM ITS OBLIGATIONS UNDER THIS
AGREEMENT. THEREFORE, IF, AFTER THE SATISFACTION OR WAIVER OF ALL
CONTINGENCIES PROVIDED FOR THE BUYER'S BENEFIT, BUYER BREACHES THIS
AGREEMENT, SELLER SHALL BE ENTITLED TO LIQUIDATED DAMAGES IN THE AMOUNT OF
$200,000.00. UPON PAYMENT OF SAID SUM TO SELLER, BUYER SHALL BE RELEASED FROM
ANY FURTHER LIABILITY TO SELLER, AND ANY ESCROW CANCELLATION FEES AND TITLE
COMPANY CHARGES SHALL BE PAID BY SELLER.
Buyer's Initials Seller's Initials
18. Miscellaneous.
18.1 Binding Effect. This Agreement shall be binding on the Parties if signed and if the paragraphs
requiring initials are initialed by both of the Parties.
18.2 Applicable Law. This Agreement shall be governed by the laws of the State of California.
18.3 Time of Essence. Time is of the essence of this Agreement.
18.4 Counterparts. This Agreement may be executed by Buyer and Seller in counterparts, each of which
shall be deemed an original, and all of which together shall constitute one and the same instrument. Escrow
Holder, after verifying that the counterparts are identical except for the signatures, is authorized and instructed
to combine the signed signature pages on one of the counterparts, which shall then constitute the Agreement.
18.5 Waiver of Jury Trial. THE PARTIES HEREBY AGREE TO THE DISPUTE RESOLUTION
PROCEDURE SET FORTH IN PARAGRAPH 26 OF THE ADDENDUM HERETO, AND ACCORDINGLY
WAIVE THEIR RESPECTIVE RIGHTS TO TRIAL BY JURY IN ANY ACTION OR PROCEEDING
INVOLVING THE PROPERTY OR ARISING OUT OF THIS AGREEMENT.
18.6 Conflict. Any conflict between the printed provisions of this Agreement and the typewritten or
handwritten provisions shall be controlled by the typewritten or handwritten provisions.
18.7 Assignment. Buyer may, with the prior written consent of Seller, assign this Agreement; provided,
however, that any such assignment shall not release Buyer from any of its covenants or obligations hereunder.
19. Construction of Agreement. In construing this Agreement, all headings and titles are for the convenience
of the parties only and shall not be considered a part of this Agreement. Whenever required by the context, the
singular shall include the plural and vice versa. Unless otherwise specifically indicated to the contrary, the
word "days" as used in this Agreement shall mean and refer to calendar days. When the words "business days"
are used, the term shall include Monday through and including Thursday, and shall exclude Friday, Saturday,
Sunday, and all holidays, it being the long time practice of the City of Vernon to be closed on Fridays. This
Agreement shall not be construed as if prepared by one of the parties, but rather according to its fair meaning as
a whole, as if both parties had prepared it.
20. Additional Provisions:
See Addendum with Paragraphs 21 through 26.
The undersigned Buyer offers and agrees to buy the Property on the terms and conditions stated and
acknowledges receipt of a copy hereof.
BUYER:
Alpine Universal, Inc., a California corporation
M
Name Printed:
Title:
By:
Name Printed:
Title:
Date:
Address:
Facsimile:
Federal ID No. 95-2851491
Seller accepts the foregoing offer to purchase the Property and hereby agrees to sell the Property to Buyer on
the terms and conditions therein specified. Seller acknowledges receipt of a copy hereof and has delivered a
signed copy to Buyer.
SELLER:
City of Vernon
By:
Leonis C. Malburg, Mayor
Attest:
Bruce V. Malkenhorst, Jr.
Acting City Clerk
Dated:
Approved As to Form
By:
Eric T. Fresch, City Attorney
Dated:
Address: 4305 Santa Fe Avenue
Vernon, CA 90058
Telephone: 323-583-8811
Fax: 323-826-1438
Federal ID No.: 95-6000808
Addendum to Standard Offer, Agreement
And Escrow Instructions for Purchase of Real Estate
Buyer: Alpine Universal, Inc.
Seller: City of Vernon
Premises: 2301. E. Vernon Avenue, Vernon, California
Dated: March 6, 2006
In the event of a conflict between the terms of the Standard Offer, Agreement and Escrow
Instructions (the "Pre -Printed Agreement") and this Addendum, the terms of this Addendum
shall control. Any initially capitalized term used in this Addendum that is not defined herein
shall have the meaning ascribed to such term in the Pre -Printed Agreement. Collectively, the
Pre -Printed Agreement and this Addendum are referred to as the "Purchase Agreement".
21. Buyer's Due Diligence: Other than those items provided or to be provided by Seller in
accordance with Paragraph 7.1, all other inspections and reports shall be at Buyer's expense.
Upon mutual execution of the Purchase Agreement and Buyer's delivery of certificates of
insurance evidencing coverage as set forth below, Buyer and its agents shall have access to the
Property to allow for necessary inspections and testing; provided, however, that Buyer may not
conduct any intrusive tests or borings without the prior written consent of the Seller, and
provided further that Seller shall arrange any such testing so that a representative of Seller will
be present at the testing. Buyer shall deliver to Seller any analyses, tests, reports, or studies
prepared by or for Buyer in connection with the Property. Prior to entering upon the Property,
Buyer shall (i) procure, pay for and keep in full force and effect during the term of this Purchase
Agreement, an occurrence form commercial general liability policy with respect to the Property
and the activities of Buyer, its agents, employees, contractors and consultants relating to the
Property in which the limits with respect to personal injury or death and property damage shall
not be less than One Million Dollars ($1,000,000) per occurrence, (ii) procure, pay for and keep
in full force and effect during the term of this Purchase Agreement, or require Buyer's
environmental consultants to procure, pay for and keep in full force and effect during the term of
this Purchase Agreement, an occurrence form pollution liability insurance policy with respect to
the Property and the activities of Buyer, its consultants, agents, employees, contractors and
subcontractors, relating to the Property in which the limits shall not be less than One Million
Dollars ($1,000,000) per occurrence, with each of the foregoing policies under (i) and (ii)
naming Seller as an additional insured party; and (iii) provide Seller with certificates of
insurance evidencing such insurance. The certificates of insurance shall be delivered to Willard
Yamaguchi, Esq., Chief Deputy City Attorney, at 4305 Santa Fe Avenue, Vernon, California
90058.
Notwithstanding any provisions of this Purchase Agreement to the contrary, Buyer may not
conduct any invasive or other testing of the Property, including but not limited to any soil
borings, groundwater sampling or Phase II site assessment investigation, except on and subject to
the following terms and conditions:
(a) Buyer and its consultant shall submit a proposed work plan ("Work Plan") to
Seller prior to commencing the proposed work and Seller shall have ten (10) business days after
receipt of such Work Plan to object and/or suggest modifications to the Work Plan. In the event
Seller objects and/or suggests modifications to the Work Plan, Buyer and Seller shall attempt to
reach agreement on a mutually acceptable Work Plan, both parties acting diligently and in good
faith. If the parties are unable to agree upon an acceptable Work Plan, either party may
terminate this Purchase Agreement by written notice to the other within ten (10) days after
reaching such impasse. If the parties are able to agree upon an acceptable Work Plan, Buyer
shall proceed with such Work Plan in accordance with this Paragraph 21. Any changes to the
agreed upon Work Plan shall be subject to approval by Seller, which shall not be withheld
unreasonably.
(b) Seller, its agent(s) and/or consultant(s) shall have the right to accompany Buyer
and its consultants on all inspections of the Property and shall have the right to take "split"
samples of all soil, groundwater and other samples collected by Buyer and/or its consultants on,
in, from or at the Property so long as Seller does not unreasonably delay Buyer's inspections of
the Property, and so long as Seller pays for its share of such split samples.
01910/0039 135515.1 1
(c) Buyer shall provide copies of all environmental data, documents, reports and
information obtained by Buyer or its consultants with respect to the Property to Seller within five
(5) days after receipt of same.
22. Condition of Property: Seller shall deliver the Property to Buyer at the Close of
Escrow in its "AS IS" condition, with all defects and/or environmental impairments
accepted with no offset against the Purchase Price. As a material inducement to the
execution and delivery of the Purchase Agreement by Seller and the performance by
Seiler of its duties and obligations hereunder, Buyer does hereby acknowledge,
represent, warrant and agree, to and with Seller that, subject to any express
representations and warranties set forth in the Purchase Agreement and subject to law:
(a) Buyer is purchasing the Property in its "AS -IS", "WHERE IS" condition; (b) Seller
shall have no obligation to repair or correct any faults, defects, or conditions with respect
to the Property; (c) by the expiration of the Due Diligence Period, Buyer shall have
undertaken all such physical inspections and examinations of the Property as Buyer
deems necessary or appropriate under the circumstances, and Buyer is not relying upon
any representations or warranties of Seller (other than those expressly set forth in the
Purchase Agreement); and (d) Buyer is purchasing the Property solely for its land value
and releases Seller from any obligations of demolition and from any defects in any of the
improvements located on the Property; and (e) except for the representations and
warranties set forth in the Purchase Agreement, Seller is not making and has not made
any warranty or representation with respect to all or any part of the Property as an
inducement to Buyer to enter into this Purchase Agreement and thereafter to purchase
the Property or for any other purpose.
Except for the obligations, agreements, representations, warranties, and
indemnities set forth in this Purchase Agreement, Buyer hereby releases Seller from any
and all rights and claims that Buyer may on its own allege, assert, or have against Seller
with respect to the condition of the Property.
23. Role of City Health Department: It is understood that nothing in this Purchase Agreement
affects or limits the City Health Department's responsibilities in the administration of local, state
and federal law with respect to remediation of the Property, if such remediation is necessary.
Seller agrees that neither Buyer's relationship to the City Health Department nor anything
required of Seller by the City Health Department in carrying out its responsibilities under the
law, shall excuse Seller's obligations under this Purchase Agreement.
24. Exchange: Seller agrees to cooperate with Buyer, at no cost, liability or expense to the
Seller, to enable Buyer to accomplish an exchange transaction under Section 1031 of the Internal
Revenue Code and to perform any and all further acts as are reasonably requested to effectuate
such an exchange. The foregoing notwithstanding, the party requesting the cooperation shall not
be released from its obligations under this Purchase Agreement on account of any such
assignment nor shall the scheduled Closing Date be extended on account of any such exchange.
25. Multiple Offers. Until the Closing, Seller may accept backup offers.
26. ARBITRATION OF DISPUTES:
26.1 USE OF JAMS. THE PARTIES AGREE THAT ANY DISPUTE OR CONTROVERSY
ARISING OUT OF OR RELATING TO ANY INTERPRETATION, CONSTRUCTION,
PERFORMANCE, TERMINATION OR BREACH OF THIS PURCHASE AGREEMENT
OR THE PURCHASE OF THE PROPERTY BY BUYER WILL BE SETTLED BY FINAL
AND BINDING ARBITRATION BY A PANEL OF ARBITRATORS TO BE HELD IN
LOS ANGELES COUNTY, CALIFORNIA, IN ACCORDANCE WITH THE RULES OF
THE JUDICIAL ARBITRATION & MEDIATION SERVICES, INC. ("JAMS").
WITHOUT LIMITING ANY OTHER PROVISION HEREIN, THIS PARAGRAPH 26
SHALL SURVIVE THE TERMINATION OF THIS PURCHASE AGREEMENT AND
WILL APPLY TO ANY CLAIM, DISPUTE, OR CONTROVERSY THAT ARISES
DURING OR AFTER THE TERMINATION OF THIS PURCHASE AGREEMENT.
01910/0039 135515.1
26.2 PROCEDURE. THE ARBITRATION SHALL TAKE PLACE BEFORE A PANEL OF
THREE RETIRED JUDGES OF THE SUPERIOR COURT OF THE STATE OF
CALIFORNIA (THE "ARBITRATORS") UNDER THE AUSPICES OF JAMS. SUCH
ARBITRATION SHALL BE INITIATED BY THE PARTIES, OR EITHER OF THEM,
WITHIN TEN (10) CALENDAR DAYS AFTER EITHER PARTY SENDS NOTICE OF A
DEMAND TO ARBITRATE (THE "ARBITRATION NOTICE") TO THE OTHER
PARTY AND TO JAMS. THE ARBITRATION NOTICE SHALL CONTAIN A
DESCRIPTION OF THE SUBJECT MATTER OF THE ARBITRATION, THE DISPUTE
WITH RESPECT THERETO, THE AMOUNT INVOLVED, IF ANY, AND THE
REMEDY OR DETERMINATION SOUGHT.
26.3 SELECTION OF ARBITRATORS. EACH PARTY SHALL SELECT A RETIRED
JUDGE FROM THE JAMS PANEL, AND THE TWO SELECTED JUDGES SHALL
MUTUALLY AGREE ON THE THIRD RETIRED JUDGE FROM THE JAMS PANEL.
IF ONE OF THE PARTIES DOES NOT SELECT A RETIRED JUDGE FROM THE
JAMS PANEL WITHIN 14 CALENDAR DAYS AFTER RECEIPT OF THE
ARBITRATION NOTICE, JAMS WILL SELECT THE SECOND JUDGE, AND THE
JUDGE SELECTED BY JAMS AND THE JUDGE SELECTED BY THE OTHER PARTY
WILL SELECT THE THIRD JUDGE FOR THE PANEL. THE THIRD JUDGE IS TO BE
SELECTED WITHIN 10 CALENDAR DAYS FOLLOWING THE SELECTION OF THE
FIRST TWO JUDGES. THE THREE JUDGES WILL TOGETHER SERVE AS THE
ARBITRATORS. IN THE EVENT OF ANY SUBSEQUENT VACANCIES OR
INABILITIES TO PERFORM AMONG THE ARBITRATORS APPOINTED, THE
ARBITRATORS INVOLVED SHALL BE REPLACED IN ACCORDANCE WITH THE
PROVISIONS OF THIS PARAGRAPH 26.3 AS IF SUCH REPLACEMENT WAS AN
INITIAL APPOINTMENT TO BE MADE UNDER THIS PARAGRAPH 26.3 WITHIN
THE TIME CONSTRAINTS SET FORTH IN THIS PARAGRAPH 26.3, MEASURED
FROM THE DATE OF NOTICE OF SUCH VACANCY OR INABILITY TO THE
PERSON OR PERSONS REQUIRED TO MAKE SUCH APPOINTMENT.
26.4 THE DECISION. ANY PARTY MAY BE REPRESENTED BY COUNSEL OR OTHER
AUTHORIZED REPRESENTATIVE. IN RENDERING A DECISION(S), THE
ARBITRATORS SHALL DETERMINE THE RIGHTS AND OBLIGATIONS OF THE
PARTIES ACCORDING TO THE SUBSTANTIVE AND PROCEDURAL LAWS OF
THE STATE OF CALIFORNIA AND THE TERMS OF THIS PURCHASE
AGREEMENT. THE DECISION OF THE ARBITRATORS SHALL BE BASED ON THE
EVIDENCE INTRODUCED AT THE HEARING, AND SHALL BE BASED ON, AND
ACCOMPANIED BY, A WRITTEN STATEMENT OF DECISION EXPLAINING THE
FACTUAL AND LEGAL BASIS FOR THE DECISION AS TO EACH OF THE
PRINCIPAL CONTROVERTED ISSUES. THE AGREEMENT OF TWO OF THE
THREE ARBITRATORS AS TO THE RESOLUTION OF THE DISPUTE SHALL BE A
CONCLUSIVE RESOLUTION. THE ARBITRATORS SHALL DELIVER THE
WRITTEN DECISION TO THE PARTIES WITHIN 30 CALENDAR DAYS
FOLLOWING THE DATE OF THE SELECTION OF THE LAST OF THE
ARBITRATORS. THE DECISION SHALL BE CONCLUSIVE AND BINDING, AND IT
MAY THEREAFTER BE CONFIRMED AS A JUDGMENT BY THE SUPERIOR
COURT OF THE STATE OF CALIFORNIA, SUBJECT ONLY TO CHALLENGE ON
THE GROUNDS SET FORTH IN THE CALIFORNIA CODE OF CIVIL PROCEDURE
SECTION 1286.2. THE VALIDITY AND ENFORCEABILITY OF THE DECISION OF
THE ARBITRATORS IS TO BE DETERMINED EXCLUSIVELY BY THE
CALIFORNIA COURTS. THE ARBITRATORS SHALL HAVE THE AUTHORITY TO
GRANT EITHER PARTY ALL REMEDIES OTHERWISE AVAILABLE BY LAW,
INCLUDING INJUNCTIONS.
26.5 PAYMENT OF ARBITRATORS. THE NON -PREVAILING PARTY SHALL PAY THE
COSTS OF ALL ARBITRATORS AND THE ARBITRATION PROCESS.
26.6 NOTICE OF WAIVER. NOTICE: BY INITIALLING IN THE SPACE BELOW YOU
ARE AGREEING TO HAVE ANY DISPUTE ARISING OUT OF THE MATTERS
INCLUDED IN THE `ARBITRATION OF DISPUTES' PROVISION DECIDED BY
NEUTRAL ARBITRATION AS PROVIDED BY CALIFORNIA LAW AND YOU ARE
GIVING UP ANY RIGHTS YOU MIGHT POSSESS TO HAVE THE DISPUTE
LITIGATED IN A COURT OR JURY TRIAL. BY INITIALLING IN THE SPACE
01910/0039 135515.1
BELOW YOU ARE GIVING UP YOUR JUDICIAL RIGHTS TO DISCOVERY AND
APPEAL, UNLESS THOSE RIGHTS ARE SPECIFICALLY INCLUDED IN THE
`ARBITRATION OF DISPUTES' PROVISION. IF YOU REFUSE TO SUBMIT TO
ARBITRATION AFTER AGREEING TO THIS PROVISION, YOU MAY BE
COMPELLED TO ARBITRATE UNDER THE AUTHORITY OF THE CALIFORNIA
CODE OF CIVIL PROCEDURES. YOUR AGREEMENT TO THIS ARBITRATION
PROVISION IS VOLUNTARY.
WE HAVE READ AND UNDERSTAND THE FOREGOING AND AGREE TO SUBMIT
DISPUTES ARISING OUT OF THE MATTERS INCLUDED IN THE `ARBITRATION OF
DISPUTES' PROVISION T NEUTRAL ARBITRATION.
BUYER'S INITIALS SELLER'S INITIALS
Executed as of the date first above written.
SELLER:
City of Vernon
By:
Leonis C. Malburg, Mayor
Attest:
Bruce V. Malkenhorst, Jr.
Acting City Clerk
Approved As to Form
By:
Eric T. Fresch, City Attorney
BUYER:
Alpine Universal, Inc.
By:
Name and Title
By:
Name and Title
01910/0039 135515.1 4
SUPPORTING
DOCUMENTS
CITY COUNCIL.
LEONIS C. MALBURG
Mayor
THOMAS A. YBARRA
Mayor Pro-Tem
WM. "BILL" DAVIS
Councilman
H. "LARRY" GONZALES
Councilman
W. MICHAEL McCORMICK
Councilman
May 1, 2006.
_Iwo .
4305 Santa Fe Avenue, Vernon, California 90058
telephone (323) 583-8811
Mr. John McMillan
Executive Director
Cushman & Wakefield of California, Inc.
601 S. Figueroa St., 47th Floor
Los Angeles, CA 90017
SOL BENUDIZ
Police Chief
MARK C. WHITWORTH
Acting Fire Chief
LEWIS J. POZZEBON
Director of Environmental Health
S. KEVIN WILSON
Director of Community Services
SHARON L. DUCKWORTH
Acting City Treasurer
r -,�17
, Li
Via Federal Express
Re: 2301 E. Vernon Avenue - Alpine Universal, Inc.
Dear John:
Enclosed please find one original purchase and sale agreement
and addendum with respect to the above -referenced property which
was approved by the City Council of the City of Vernon on
March 22, 2006 by Resolution No. 8993.
If you have any questions, please do not hesitate to contact me.
Scerely,
WILLARD G. A CHI
Chief Deput ty Attorney/
Acting Risk Manager
jl
Enclosure
cc: NO "°° `" ;Deputy City Clerk (1 original)
Sandy 810n, Troy & Gould (1 original)
'E'Nelugivety jubuo al
STANDARD OFFER, AGREEMENT AND ESCROW
INSTRUCTIONS FOR PURCHASE OF REAL ESTATE
(Non -Residential)
March 6, 2006
1. Buyer (Date for Reference Purposes)
1.1 Alpine Universal, Inc., a California corporation ("Buyer") hereby offers to purchase the real
property, hereinafter described, from the City of Vernon ("Seller") (collectively, the "Parties" or individually, a
"Party"), through an escrow ("Escrow") to close on a date mutually agreed to by the Parties that is on or before
30 days after the expiration of the Contingency Period ("Closing Date"). The Closing shall be held by North
American Title Company (Attn: Tina De Bow) ("Escrow Holder") whose address is 520 North Brand Blvd.,
Glendale, California 91203, Phone No. 818-551-5370, Facsimile No. 818-240-9884, upon the terms and
conditions set forth in this agreement ("Agreement").
1.2 The term "Date of Agreement" shall be the date when by execution and delivery of this document
or a subsequent counteroffer thereto, Buyer and Seller have reached agreement in writing whereby Seller agrees
to sell, and Buyer agrees to purchase, the Property upon terms accepted by both Parties.
2. Property
2.1 The real property ("Property") that is the subject of this offer consists of the property located at
2301 E. Vernon Avenue, City of Vernon, State of California, consisting of approximately 134,650 square feet
of various industrial buildings located on approximately 263,102 square feet of industrial land, with the APN to
be determined in Escrow.
2.2 The legal description of the Property shall be completed to meet the requirements of North American
Title (Attn: Mr. Victor Greene) ("Title Company'), which shall issue the title policy hereinafter described.
2.3 The Property shall be delivered with all existing improvements in their current "as is" condition.
3. Purchase Price
3.1 The purchase price ("Purchase Price") to be paid by Buyer to Seller for the Property shall be
$8,350,000.00, and there shall be no adjustment to the Purchase Price, regardless of actual size of property or
square footage of buildings, all of which are acknowledged to be estimates. The Purchase Price shall be
payable all cash at the Closing, provided; however, that the Deposit, as defined below, shall be applied to the
Purchase Price at the Closing. There is no loan contingency.
4. Deposits
4.1 Within two business days following the mutual execution of this: Agreement, Buyer will deliver to
Escrow Holder by wire transfer the sum of Two Hundred Thousand Dollars ($200,000 (the "Deposit"), along
with an executed copy of this Agreement.
4.2 Escrow Holder shall deposit the funds deposited with it by Buyer pursuant to Paragraph 4.1 in a
State or Federally chartered bank in an interest -bearing account whose term is appropriate and consistent with
the timing requirements of this transaction. The interest therefrom shall accrue to the benefit of Buyer, who
hereby acknowledges that there may be penalties or interest forfeitures if the applicable instrument is redeemed
prior to its specified maturity; provided, however, that if the Seller retains the Deposit as liquidated damages,
the liquidated damages shall include the interest. Buyer's Federal Tax Identification Number is
NOTE: Such interest bearing account cannot be opened until Buyer's Federal Tax Identification number is
provided.
4.3 After the last day of the Due Diligence Period, the Deposit shall be non-refundable to Buyer, but
shall be fully applicable to the Purchase Price.
S. Real Estate Brokers
Buyer and Seller are both represented by Cushman & Wakefield of California, Inc. ("Broker"). Buyer and
Seller each represent and warrant to the other that, except for Broker, the Buyer and Seller have had no dealings
with any person, firm, broker or finder in connection with the negotiation of this Agreement or the
consummation of the purchase and sale contemplated herein, and no broker or other person, firm or entity, is/are
entitled to any commission or finder's fee in connection with this transaction as the result of any dealings or
acts of such Party. Buyer and Seller each hereby agree to indemnify, defend, protect and hold the other
harmless from and against any costs, expenses or liability for compensation, commission or charges which may
4_�/ z
Initials PAGE'1 Initials
01910/0039135508.1
be claimed by any broker, finder or other similar party by reason of any dealings or act of the indemnifying
Party, except for Seller's obligation to compensate Broker in accordance with the terms of a separate agreement
between Seller and Broker, which commission shall be payable out of the Escrow if and only if there is a
Closing.
6. Escrow and Closing
6.1 Upon acceptance hereof by Seller, this Agreement, including any counteroffers incorporated herein
by the Parties, shall constitute not only the agreement of purchase and sale between Buyer and Seller, but also
instructions to Escrow Holder for the consummation of the Agreement through the Escrow. Escrow Holder
shall not prepare any further escrow instructions restating or amending the Agreement unless specifically so
instructed by the Parties. Subject to the reasonable approval of the Parties, Escrow Holder may, however,
include its standard general escrow provisions; provided, however, that in the event of a conflict between the
terms of this Agreement, and Escrow Holder's instructions, the terms of this Agreement shall control.
6.2 As soon as practical after the receipt of this Agreement and any relevant counteroffers, Escrow
Holder shall ascertain the Date of Agreement as defined in Paragraph 1.2 and advise the Parties, in writing, of
the date ascertained. Escrow Holder is hereby authorized and instructed to conduct the Escrow in accordance
with this Agreement, applicable law and custom and practice of the community in which Escrow Holder is
located, including any reporting requirements of the Internal Revenue Code.
6.3 Subject to satisfaction or waiver of the Buyer's Contingencies, Escrow Holder shall close this
Escrow (the "Closing") by recording a grant deed and the other documents required to be recorded, and by
disbursing the funds and documents in accordance with this Agreement.
6.4 Buyer and Seller shall each pay one-half of the Escrow Holder's charges and Seller shall pay the
usual recording fees and any required documentary transfer taxes. Seller shall pay the premium for a standard
coverage owner's or joint protection policy of title insurance. Buyer shall pay for any additional endorsements
or ALTA coverage, if obtained by Buyer.
6.5 Escrow Holder shall verify that all of Buyer's Contingencies have been satisfied or waived prior to
Closing.
6.6 If this transaction is terminated for non -satisfaction and non -waiver of a Buyer's Contingency, as
defined in Paragraph 7.1, then neither of the Parties shall thereafter have any liability to the other under this
Agreement, except to the extent of a breach of any affirmative covenant or warranty in this Agreement. In the
event of such termination, Buyer shall be promptly refunded all funds deposited by Buyer with Escrow Holder,
less only Title Company and Escrow Holder cancellation fees and costs, all of which shall be Buyer's
obligation.
6.7 The Closing shall occur on the Closing Date, or as soon thereafter as the Escrow is in condition for
Closing; provided, however, that if the Closing does not occur within 5 days after the Closing Date and said
Date is not extended by mutual instructions of the Parties, a Party not then in default under this Agreement may
notify the other Party and Escrow Holder, in writing that, unless the Closing occurs within 5 days following said
notice, the Escrow shall be deemed terminated without further notice or instructions.
6.8 Except as otherwise provided herein, the termination of Escrow shall not relieve or release either
Party from any obligation to pay Escrow Holder's fees and costs or constitute a waiver, release or discharge of
any breach or default that has occurred in the performance of the obligations, agreements, covenants or
warranties contained therein.
6.9 If this Escrow is terminated for any reason other than Seller's breach or default, then at Seller's
request, and as a condition to the return of Buyer's deposit, Buyer shall within 5 business days after written
request deliver to Seller, at no charge, copies of all surveys, engineering studies, soil reports, maps, master
plans, feasibility studies and other similar items prepared by or for Buyer that pertain to the Property.
6.10 If this Escrow does not close as a result of Seller's failure to deliver the documents required to close
the Escrow, the Deposit shall be refunded to Buyer.
7. Contingencies to Closing
7.1 The Closing of this transaction is contingent upon the satisfaction or waiver of the following
contingencies and any other matter in the sole discretion of Buyer. Buyer may terminate this Agreement and
cancel the Escrow if Buyer disapproves, at Buyer's sole discretion, of any item during the Due Diligence Period
("Buyer's Contingencies") IF BUYER FAILS TO NOTIFY ESCROW HOLDER AND SELLER, IN
WRITING, OF THE DISAPPROVAL OF ANY OF BUYER'S CONTINGENCIES WITHIN THE TIME
SPECIFIED HEREIN, IT SHALL BE CONCLUSIVELY PRESUMED THAT BUYER HAS APPROVED
SUCH ITEM, MATTER OR DOCUMENT. Buyer's conditional approval shall constitute disapproval, unless
provision is made by the Seller within the time specified therefor by the Buyer in such conditional approval or
by this Agreement, whichever is later, for the satisfaction of the condition imposed by the Buyer. Escrow
Holder shall promptly provide all parties with copies of any written disapproval or conditional approval which it
receives. Buyer's period for approval or disapproval of the Buyer's Contingencies set forth in Paragraph 7 shall
end at 5:00 P.M., California time, on the 30' calendar day after the Date of Agreement (which 30 day period
shall be extended to the next business day if it ends on a Friday, weekend, or holiday) (the "Due Diligence
Period").
Initials PAGE 2 Initials
01910/0039 135508.1
(a) Disclosure. Seller shall make to Buyer, through Escrow, all of the applicable disclosures
required by law (per AIR Commercial Real Estate Association (".AIR") standard form entitled "Seller's
Mandatory Disclosure Statement") and provide Buyer with a completed Property Information Sheet ("Property
Information Sheet") concerning the Property, duly executed by or on behalf of Seller in the current form or
equivalent to that published by the AIR, within 7 business days following the Date of Agreement. All
disclosures set forth in the Seller's Mandatory Disclosure Statement and the Property Information Sheet shall be
true and correct to the current actual knowledge of Kevin Wilson, the Director of Community Services, without
duty of investigation. Seller shall deliver to Buyer a report paid for by Seller and prepared by a professional
provider containing the Natural Hazard Disclosures concerning the Property. Unless otherwise noted by Seller
to Buyer in writing, Seller is unaware of any inaccuracies in the Natural Hazard Disclosures. Buyer
acknowledges receipt of the following, which were delivered to Buyer, through Broker, prior to the execution of
this Agreement: Certificate of Closure signed by the City's Health Department; an ALTA survey obtained by
Seller when it purchased the Property in August 2004; and the title report delivered to Seller by the Title
Company when Seller purchased the Property in August 2004. All reports, permits, plans, drawings, designs,
and other documents related to the physical condition of the Property and any improvements located on the
Property (other than reports related to environmental conditions) in the possession of the Seller are located at
the Department of Community Services at Vernon City Hall, and all reports, analyses, studies, and other
documents related to the environmental condition of the Property in the possession of the Seller are located at
the Health Department at Vernon City Hall. All of such documents may be inspected and reviewed during the
City of Vernon's standard hours for counter service, and a reasonable number of documents selected by Buyer
will be copied by the City of Vernon for Buyer's files, subject to the terms of Paragraph 10.4 below.
(b) Physical Inspection. Buyer has 60 days from the Date of Agreement to satisfy itself with
regard to the physical aspects and size of the Property.
(c) Hazardous Substance Conditions Report. Buyer has 60 days from the Date of Agreement to
satisfy itself with regard to the environmental aspects of the Property. Seller recommends that Buyer obtain a
Hazardous Substance Conditions Report concerning the Property and relevant adjoining properties. Any such
report shall be paid for by Buyer. A "Hazardous Substance" for purposes of this Agreement is defined as any
substance whose nature and/or quantity of existence, use, manufacture, disposal or effect, render it subject to.
Federal, state or local regulation, investigation, remediation or removal as potentially injurious to public health
or welfare. A "Hazardous Substance Condition" for purposes of this Agreement is defined as the existence
on, under or relevantly adjacent to the Property of a Hazardous Substance that would require remediation and/or
removal under applicable Federal, state or local law.
(d) Soil Inspection. Buyer has 60 days from the Date of Agreement to satisfy itself with regard to
the condition of the soils on the Property. Seller recommends that Buyer obtain a soil test report. Any such
report shall be paid for by Buyer.
(e) Governmental Approvals. Buyer has 60 days from the Date of Agreement to satisfy itself with
regard to approvals and permits from governmental agencies or departments which have or may have
jurisdiction over the Property and which Buyer deems necessary or desirable in connection with its intended use
of the Property, including, but not limited to, permits and approvals required with respect to zoning, planning,
building and safety, fire, police, handicapped and Americans with Disabilities Act requirements, transportation
and environmental matters.
(t) Conditions of Title. Escrow Holder shall cause a preliminary title report ("Title Report")
concerning the Property issued by the Title Company, as well as legible copies of all documents referred to in
the Title Commitment ("Underlying Documents") to be delivered to Buyer within 15 calendar days following
the Date of Agreement. Buyer has 60 days from the Date of Agreement to satisfy itself with regard to the
condition of title. The disapproval of Buyer of any monetary encumbrance shall not be considered a failure of
this contingency, as Seller shall have the obligation, at Seller's expense, to satisfy and remove such disapproved
monetary encumbrance at or before the Closing.
(g) Survey. Seller has delivered to Buyer, without warranty, the ALTA survey that Seller obtained
when it purchased the Property in August 2004. Buyer shall have 60 days from the Date of Agreement to
approve the survey provided by Seller or obtain and approve its own ALTA survey. Buyer may elect within
the period allowed for Buyer's approval of a survey to have an ALTA extended coverage owner's form of title
policy, in which event Buyer shall pay any additional premium attributable thereto.
(h) Other Agreements. Seller shall within 7 business days from the Date of Agreement provide
Buyer with legible copies of all other agreements ("Other Agreements") readily available to Seller that will
affect the Property after Closing. Buyer has 60 days from the Date of Agreement to satisfy itself with regard to
such Agreements.
(i) Seller Performance. The delivery of all documents and the due performance by Seller of each
and every undertaking and agreement to be performed by Seller under this Agreement.
0) Warranties. That each representation and warranty of Seller herein be true and correct as of
the Closing. Escrow Holder shall assume that this condition has been satisfied unless notified to the contrary in
writing by any Party prior to the Closing.
7.2 All of the contingencies specified in the sub -paragraphs of Paragraph 7.1 are for the benefit of, and
may be waived by, Buyer.
_Y_ -
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01910/0039 135508.1
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7.3 If any Buyer's Contingency or any other matter subject to Buyer's approval is disapproved as
provided for herein in a timely manner ("Disapproved Item"), Seller shall have the right within 10 days
following the receipt of notice of Buyer's disapproval to elect to cure such Disapproved Item prior to the
Closing Date ("Seller's Election"). Seller's failure to give to Buyer within such period, written notice of
Seller's commitment to cure such Disapproved Item on or before the Closing Date shall be conclusively
presumed to be Seller's Election not to cure such Disapproved Item. If Seller elects, either by written notice or
failure to give written notice, not to cure a Disapproved Item, Buyer shall have the election, within 10 days after
Seller's Election to either accept title to the Property subject to such Disapproved Item, or to terminate this
transaction. Buyer's failure to notify Seller in writing of Buyer's election to accept title to the Property subject
to the Disapproved Item without deduction or offset shall constitute Buyer's election to terminate this
transaction. Unless expressly provided otherwise herein, Seller's right to cure shall not apply to the remediation
of Hazardous Substance Conditions. Unless the Parties mutually instruct otherwise, if the time periods for the
satisfaction of contingencies or for Seller's and Buyer's said Elections would expire on a date after the Closing
Date, the Closing Date shall be deemed extended for 5 business days following the expiration of: (a) the
applicable contingency period(s), (b) the period within which the Seller may elect to cure the Disapproved Item,
or (c) if Seller elects not to cure, the period within which Buyer may elect to proceed with this transaction,
whichever is later.
7.4 The Parties acknowledge that extensive local, state and Federal legislation establish broad liability
upon owners and users of real property for the investigation and remediation of Hazardous Substances. The
determination of the existence of a Hazardous Substance Condition and the evaluation of the impact of such a
condition are highly technical. The Buyer acknowledges that it has been advised by Seller to consult its own
technical and legal experts with respect to the possible presence of Hazardous Substances on the Property or
adjoining properties, and Buyer is not relying upon any investigation by or statement of Seller with respect
thereto. Buyer assumes all responsibility for the impact of such Hazardous Substances.
s. Documents Required at or before Closing:
8.1 By the Closing date Escrow Holder shall obtain an updated Title Report concerning the Property
from the Title Company and provide copies thereof to each of the Parties.
8.2 Seller shall deliver to Escrow Holder in time for delivery to Buyer at the Closing:
(a) Grant deed, duly executed and in recordable form, conveying fee title to the Property to Buyer.
(b) An affidavit executed by Seller to the effect that Seller is not a "foreign person" within the
meaning of Internal Revenue Code Section 1445 or successor statutes. If Seller does not provide such affidavit
in form reasonably satisfactory to Buyer at least 3 business days prior to the Closing, Escrow Holder shall at the
Closing deduct from Seller's proceeds and remit to Internal Revenue Service such sum as is required by
applicable Federal law with respect to purchases from foreign sellers.
(c) An affidavit executed by Seller to the effect that Seller is not a "nonresident" within the
meaning of California Revenue and Tax Code Section 18662 or successor statutes. If Seller does not provide
such affidavit in form reasonably satisfactory to Buyer at least 3 business days prior to the Closing, Escrow
Holder shall at the Closing deduct from Seller's proceeds and remit to the Franchise Tax Board such sum as is
required by such statute.
8.3 Buyer shall deliver to Seller through.Escrow:
(a) The cash portion of the Purchase Price and such additional sums as are required of Buyer under
this Agreement shall be deposited by Buyer with Escrow Holder, by federal funds wire transfer, or any other
method acceptable to Escrow Holder as immediately collectable funds, no later than 2:00 P.M. on the business
day prior to the Closing Date.
(b) A duly executed corporate resolution authorizing the execution of this Agreement and the
purchase of the Property.
8.4 At Closing, Escrow Holder shall cause to be issued to Buyer a standard coverage (or ALTA
extended, if elected) owner's form policy of title insurance effective as of the Closing, issued by the Title
Company in the full amount of the Purchase Price, insuring title to the Property vested in Buyer, subject only to
the exceptions approved by Buyer. In the event there is a Purchase Money Deed of Trust in this transaction, the
policy of title insurance shall be a joint protection policy insuring both Buyer and Seller.
9. Prorations and Adjustments.
9.1 Taxes. Applicable real property taxes and special assessment bonds shall be prorated through
Escrow as of the date of the Closing, based upon the latest tax bill available. The Parties agree to prorate as of
the Closing any taxes assessed against the Property by supplemental bill levied by reason of events occurring
prior to the Closing. Payment of the prorated amount shall be made promptly in cash upon receipt of a copy of
any such supplemental bill.
9.2 Insurance. WARNING: Any insurance which Seller may have maintained will terminate on the
Closing. Buyer is advised to obtain appropriate insurance to cover the Property.
9.3 Expenses. Utilities and operating expenses shall be prorated as of the date of Closing.
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01910/0039135508.1
10. Representations and Warranties of Seller and Disclaimers.
10.1 Buyer acknowledges that Seller has recently acquired the Property, and has not used or operated any
business on the Property, and has no actual knowledge of the condition of the Property.9
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Buyer is relying solely and exclusively on its own
knowledge of the condition of the Property and its own inspections, if any, and waives any claims against Seller
for any faults or defects on the Property or any Hazardous Substance that may be in, on, under, or around the
Property. Seller has not made any representation or warranty as to the "Property Condition". "Property
Condition" means and refers to each and every matter of concern or relevance to Buyer relating to the Property,
including, without limitation, the financial, legal, title, physical, geological and environmental condition and
sufficiency of the Property; applicable governmental laws, regulations, and zoning, building codes, and the
extent to which the Property complies therewith; the fitness of the Property for Buyer's contemplated use; the
presence of Hazardous Substances; and the value of the Property. Seller hereby makes only the following
warranties and representations to Buyer:
Authority of Seller. Seller is the owner of the Property and/or has the full right, power and authority to sell,
convey and transfer the Property to Buyer as provided herein, and to perform Seller's obligations hereunder.
10.2 Buyer hereby acknowledges that Buyer is purchasing the Property in its current "AS IS" condition,
with all faults and that Buyer will, by the time called for herein, make or have waived all inspections of the
Property that Buyer believes are necessary to protect its own interest in, and its contemplated use of, the
Property. The Parties acknowledge that, except as specifically set forth in this Agreement, no representations,
inducements, promises, agreements, assurances, oral or written, concerning the Property, the value of the
Property, or any aspect of the Property, Hazardous Substance laws, or any other act, ordinance or law, have
been made by either Party or Seller, or relied upon by Buyer. Seller has no obligation to repair, correct or
compensate Buyer for any Property Condition.
10.3 In the event that Buyer learns that a Seller representation or warranty might be untrue prior to the
Closing, and Buyer elects to purchase the Property anyway then, and in that event, Buyer waives any right that
it may have to bring an action or proceeding against Seller regarding said representation or warranty.
10.4 Any environmental reports, soils reports, surveys, demolition reports, reports of the condition of the
Property and any improvements located thereon and other similar documents which were prepared by third
party consultants and made available to Buyer for inspection and review have been made available as an
accommodation to Buyer and without any representation or warranty as to the sufficiency, accuracy,
completeness, or validity of said documents, all of which Buyer relies on at its own risk.
10.5 Upon Closing, Buyer shall be deemed to have waived any and all objections to the Property
Condition, whether or not known to Buyer. Upon Closing, Buyer hereby waives, releases, acquits, and forever
discharges Seller, and Seller's agents, beneficiaries, heirs, successors, and assigns to the maximum extent
permitted by law from any and all claims, actions, causes of action, demands, rights, liabilities, damages, costs
(including, without limitation, reasonable attorneys' fees and costs), losses, 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 related to or in connection with the Property Condition. BUYER
EXPRESSLY WAIVES ANY RIGHTS OR BENEFITS IT MAY HAVE 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 AF CTED HIS SETTLEMENT WITH THE DEBTOR.
Buyer's Initials Seller's Initials
11. Possession.
Possession of the Property shall be given to Buyer at the Closing.
12. Further Documents and Assurances.
The Parties shall each, diligently and in good faith, undertake all actions and procedures reasonably
required to place the Escrow in condition for Closing as and when required by this Agreement. The Parties
agree to provide all further information, and to execute and deliver all further documents, reasonably required
by Escrow Holder or the Title Company.
13. Attorneys' Fees.
If any Party brings an action or proceeding (including arbitration) involving the Property whether founded
in tort, contract or equity, or to declare rights hereunder, the Prevailing Party (as hereafter defined) in any such
proceeding, action, or appeal thereon, shall be entitled to reasonable attorneys' fees. Such fees may be awarded
in the same suit or recovered in a separate suit, whether or not such action or proceeding is pursued to decision
or judgment. The term, "Prevailing Party" shall include, without limitation, a Party who substantially obtains
Initials PAGE 5 Initials
01910/0039135508.1
Or' defeats the relief sought, as the case may be, whether by compromise, settlement, judgment, or the
abandonment by the other Party of its claim or defense. The attorneys' fees award shall not be computed in
accordance with any court fee schedule, but shall be such as to fully reimburse all attorneys' fees reasonably
incurred.
14. Prior Agreements/Amendments.
14.1 This Agreement is the entire agreement between the parties as to the matters described herein, and
supersedes any and all prior negotiations, discussions, writings, documents, and agreements, whether oral or
written, between Seller and Buyer regarding the Property or the transactions contemplated by this Agreement.
14.2 Amendments to this Agreement are effective only if made in writing and executed by Buyer and
Seller.
15. Notices.
15.1 Whenever any Party or Escrow Holder shall desire to give or serve any notice, demand, request,
approval, disapproval or other communication, each such communication shall be in writing and shall be
delivered personally, by messenger or by mail, postage prepaid, or by overnight courier, to the address set forth
in this Agreement or by facsimile transmission.
15.2 Service of any such communication shall be deemed made on the date of actual receipt or refusal to
accept delivery. Communications transmitted by facsimile transmission shall be deemed delivered upon
telephonic confirmation of receipt (confirmation report from fax machine is sufficient), provided a copy is also
delivered via delivery or mail. If such communication is received on a Friday, Saturday, Sunday or legal
holiday, it shall be deemed received on the next business day.
15.3 Any Party hereto may from time to time, by notice in writing, designate a different address to which,
or a different person or additional persons to whom, all communications are thereafter to be made.
16. Duration of Offer.
16.1 If a signed copy of this offer (with Paragraphs 10.5 and 17 and 26 initialed) is not received by Seller
on or before 7:00 P.M. according to the time standard applicable to the city of Los Angeles on the date of
, 2006 it shall be deemed automatically revoked, and if Seller has not signed this offer by
5:00 P.M. on , 2006 it shall be deemed automatically revoked.
16.2 The acceptance of this offer, or of any subsequent counter offer hereto, that creates an agreement
between the Parties as described in Paragraph 1.2, shall be deemed made upon delivery to the other Party of a
duly executed writing unconditionally accepting the last outstanding offer or counteroffer.
17. LIQUIDATED DAMAGES. (This Liquidated Damages paragraph is applicable only if initialed by both
parties)
THE PARTIES AGREE THAT IT WOULD BE IMPRACTICABLE OR EXTREMELY DIFFICULT TO
FIX, PRIOR TO SIGNING THIS AGREEMENT, THE ACTUAL DAMAGES WHICH WOULD BE
SUFFERED BY SELLER IF BUYER FAILS TO PERFORM ITS OBLIGATIONS UNDER THIS
AGREEMENT. THEREFORE, IF, AFTER THE SATISFACTION OR WAIVER OF ALL
CONTINGENCIES PROVIDED FOR THE BUYER'S BENEFIT, BUYER BREACHES THIS
AGREEMENT, SELLER SHALL BE ENTITLED TO LIQUIDATED DAMAGES IN THE AMOUNT OF
$200,000.00. UPON PAYMENT OF SAID SUM TO SELLER, BUYER SHALL BE RELEASED FROM
ANY FURTHER LIABILITY TO SELLER, AND ANY ESCROW CANCELLATION FEES AND TITLE
COMPANY CHARGES SHALL BE PAID BY ELLER.
Dv� -
t
Buyer's Initials Seller's Initials
18. Miscellaneous.
18.1 Binding Effect. This Agreement shall be binding on the Parties if signed and if the paragraphs
requiring initials are initialed by both of the Parties.
18.2 Applicable Law. This Agreement shall be governed by the laws of the State of California.
18.3 Time of Essence. Time is of the essence of this Agreement.
18.4 Counterparts. This Agreement may be executed by Buyer and Seller in counterparts, each of which
shall be deemed an original, and all of which together shall constitute one and the same instrument. Escrow
Holder, after verifying that the counterparts are identical except for the signatures, is authorized and instructed
to combine the signed signature pages on one of the counterparts, which shall then constitute the Agreement.
18.5 Waiver of Jury Trial. THE PARTIES HEREBY AGREE TO THE DISPUTE RESOLUTION
PROCEDURE SET FORTH IN PARAGRAPH 26 OF THE ADDENDUM HERETO, AND ACCORDINGLY
WAIVE THEIR RESPECTIVE RIGHTS TO TRIAL BY JURY IN ANY ACTION OR PROCEEDING
INVOLVING THE PROPERTY OR ARISING OUT OF THIS AGREEMENT.
18.6 Conflict. Any conflict between the printed provisions of this Agreement and the typewritten or
handwritten provisions shall be controlled by the typewritten or handwritten provisions.
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01910/0039135508.1
18,7 Assignment. Buyer may, with the prior written consent of Seller, assign this Agreement; provided,
iowever, that any such assignment shall not release Buyer from any of its covenants or obligations hereunder.
9. Construction of Agreement. In construing this Agreement, all headings and titles are for the convenience
if the parties only and shall not be considered a part of this Agreement. Whenever required by the context, the
ingular shall include the plural and vice versa. Unless otherwise specifically indicated to the contrary, the
vord "days" as used in this Agreement shall mean and refer to calendar days. When the words "business days"
re used, the term shall include Monday "through and including Thursday, and shall exclude Friday, Saturday,
'unday, and all holidays, it being the long time practice of the City of Vernon to be closed on Fridays. This
,greement shall not be construed as if prepared by one of the parties, but rather according to its fair meaning as
. whole, as if both parties had prepared it.
o. Additional Provisions:
gee Addendum with Paragraphs 21 through 26
'he undersigned Buyer offers and agrees to buy the Property on the terms and conditions stated and
.cknowledges receipt of a copy hereof.
BUYER:
Alpine Universal/*F,j a galifornia corporation
By:
le rinted: JA6JFS %
Ti' 2�
tl
By:
rinted: <.3rv►��-' -1H t �5�c.A•DPO
Title. <-*::(!::5� cc�—,?,
Date: 5 L-2-i(o�
Address: 4009
Facsimile:
Federal ID No. 95-2851491
Initials
1910/0039135508.1
PAGE 7 Initials
Seller accepts the foregoing offer to purchase the Property and hereby agrees to sell the Property to Buyer on
the terms and conditions therein specified. Seller acknowledges receipt of a copy hereof and has delivered a
signed copy to Buyer.
SELLER:
City of Vernon
By:�,
Leonis C. Malburg, Mayor
Attest:
l
kruc,e). Malkenhorst, Jr.
Acting City Clerk
Dated: G�"- - -�0, 02 a &
Approved As to Form
By: f '
Eric T. Fresch, City Attorney
Dated: (7��;13 � 0 6
Address: 4305 Santa Fe Avenue
Vernon, CA 90058
Telephone: 323-583-8811
Fax: 323-826-1438
Federal ID No.: 95-6000808
Initials
01910/0039 135508.1
PAGE 8
m
Initials
Addendum to Standard Offer, Agreement
And Escrow Instructions for Purchase of Real Estate
Buyer: Alpine Universal, Inc.
Seller: City of Vernon
Premises: 2301. E. Vernon Avenue, Vernon, California
Dated: March 6, 2006
In the event of a conflict between the terms of the Standard Offer, Agreement and Escrow
Instructions (the "Pre -Printed Agreement") and this Addendum, the terms of this Addendum
shall control. Any initially capitalized term used in this Addendum that is not defined, herein
shall have the meaning ascribed to such term in the Pre -Printed Agreement. Collectively, the
Pre -Printed Agreement and this Addendum are referred to as the "Purchase Agreement".
21. Buyer's Due Diligence: Other than those items provided or to be provided by Seller in
accordance with Paragraph 7.1, all other inspections and reports shall be at Buyer's expense.
Upon mutual execution of the Purchase Agreement and Buyer's delivery of certificates of
insurance evidencing coverage as set forth below, Buyer and its agents shall have access to the
Property to allow for necessary inspections and testing; provided, however, that Buyer may not
conduct any intrusive tests or borings without the prior written consent of the Seller, and
provided further that Seller shall arrange any such testing so that a representative of Seller will
be present at the testing. Buyer shall deliver to Seller any analyses, tests, reports, or studies
prepared by or for Buyer in connection with the Property. Prior to entering upon the Property,
Buyer shall (i) procure, pay for and keep in full force and effect during the term of this Purchase
Agreement, an occurrence form commercial general liability policy with respect to the Property
and the activities of Buyer, its agents, employees, contractors and consultants relating to the
Property in which the limits with respect to personal injury or death and property damage shall
not be less than One Million Dollars ($1,000,000) per occurrence, (ii) procure, pay for and keep
in full force and effect during the term of this Purchase Agreement, or require Buyer's
environmental consultants to procure, pay for and keep in full force and effect during the term of
this Purchase Agreement, an occurrence form pollution liability insurance policy with respect to
the Property and the activities of Buyer, its consultants, agents, employees, contractors and
subcontractors, relating to the Property in which the limits shall not be less than One Million
Dollars ($1,000,000) per occurrence, with each of the foregoing policies under (i) and (ii)
naming Seller as an additional insured party; and (iii) provide Seller with certificates of
insurance evidencing such insurance. The certificates of insurance shall be delivered to Willard
Yamaguchi, Esq., Chief Deputy City Attorney, at 4305 Santa Fe Avenue, Vernon, California
90058.
Notwithstanding any provisions of this Purchase Agreement to the contrary, Buyer may not
conduct any invasive or other testing of the Property, including but not limited to any soil
borings, groundwater sampling or Phase II site assessment investigation, except on and subject to
the following terms and conditions:
(a) Buyer and its consultant shall submit a proposed work plan ("Work Plan") to
Seller prior to commencing the proposed work and Seller shall have ten (10) business days after
receipt of such Work Plan to object and/or suggest modifications to the Work Plan. In the event
Seller objects and/or suggests modifications to the Work Plan, Buyer and Seller shall attempt to
reach agreement on a mutually acceptable Work Plan, both parties acting diligently and in good
faith. If the parties are unable to agree upon an acceptable Work Plan, either party may
terminate this Purchase Agreement by written notice to the other within ten (10) days after
reaching such impasse. If the parties are able to agree upon an acceptable Work Plan, Buyer
shall proceed with such Work Plan in accordance with this Paragraph 21. Any changes to the
agreed upon Work Plan shall be subject to approval by Seller, which shall not be withheld
unreasonably.
(b) Seller, its agent(s) and/or consultant(s) shall have the right to accompany Buyer
and its consultants on all inspections of the Property and shall have the right to take "split"
samples of all soil, groundwater and other samples collected by Buyer and/or its consultants on,
in, from or at the Property so long as Seller does not unreasonably delay Buyer's inspections of
the Property, and so long as Seller pays for its share of such split samples.
01910/0039 135515.1
(c) Buyer shall provide copies of all environmental data, documents, reports and
information obtained by Buyer or its consultants with respect to the Property to Seller within five
(5) days after receipt of same.
22. Condition of Property: Seller shall deliver the Property to Buyer at the Close of
Escrow in its "AS IS" condition, with all defects and/or environmental impairments
accepted with no offset against the Purchase Price. As a material inducement to the
execution and delivery of the Purchase Agreement by Seller and the performance by
Seller of its duties and obligations hereunder, Buyer does hereby acknowledge,
represent, warrant and agree, to and with Seller that, subject to any express
representations and warranties set forth in the Purchase Agreement and subject to law:
(a) Buyer is purchasing the Property in its "AS -IS", "WHERE IS" condition; (b) Seller
shall have no obligation to repair or correct any faults, defects, or conditions with respect
to the Property; (c) by the expiration of the Due Diligence Period, Buyer shall have
undertaken all such physical inspections and examinations of the Property as Buyer
deems necessary or appropriate under the circumstances, and Buyer is not relying upon
any representations or warranties of Seller (other than those expressly set forth in the
Purchase Agreement); and (d) Buyer is purchasing the Property solely for its land value
and releases Seller from any obligations of demolition and from any defects in any of the
improvements located on the Property; and (e) except for the representations and
warranties set forth in the Purchase Agreement, Seller is not making and has not made
any warranty or representation with respect to all or any part of the Property as an
inducement to Buyer to enter into this Purchase Agreement and thereafter to purchase
the Property or for any other purpose.
Except for the obligations, agreements, representations, warranties, and
indemnities set forth in this Purchase Agreement, Buyer hereby releases Seller from any
and all rights and claims that Buyer may on its own allege, assert, or have against Seller
with respect to the condition of the Property.
23. Role of City Health Department: It is understood that nothing in this Purchase Agreement
affects or limits the City Health Department's responsibilities in the administration of local, state
and federal law with respect to remediation of the Property, if such remediation is necessary.
Seller agrees that neither Buyer's relationship to the City Health Department nor anything
required of Seller by the City Health Department in carrying out its responsibilities under the
law, shall excuse Seller's obligations under this Purchase Agreement.
24. Exchange: Seller agrees to cooperate with Buyer, at no cost, liability or expense to the
Seller, to enable Buyer to accomplish an exchange transaction under Section 1031 of the Internal
Revenue Code and to perform any and all further acts as are reasonably requested to effectuate
such an exchange. The foregoing notwithstanding, the party requesting the cooperation shall not
be released from its obligations under this Purchase Agreement on account of any such
assignment nor shall the scheduled Closing Date be extended on account of any such exchange.
25. Multiple Offers. Until the Closing, Seller may accept backup offers.
26. ARBITRATION OF DISPUTES:
26.1 USE OF JAMS. THE PARTIES AGREE THAT ANY DISPUTE OR CONTROVERSY
ARISING OUT OF OR RELATING TO ANY INTERPRETATION, CONSTRUCTION,
PERFORMANCE, TERMINATION OR BREACH OF THIS PURCHASE AGREEMENT
OR THE PURCHASE OF THE PROPERTY BY BUYER WILL BE SETTLED BY FINAL
AND BINDING ARBITRATION BY A PANEL OF ARBITRATORS TO BE HELD IN
LOS ANGELES COUNTY, CALIFORNIA, IN ACCORDANCE WITH THE RULES OF
THE JUDICIAL ARBITRATION & MEDIATION SERVICES, INC. ("JAMS").
WITHOUT LIMITING ANY OTHER PROVISION HEREIN, THIS PARAGRAPH 26
SHALL SURVIVE THE TERMINATION OF THIS PURCHASE AGREEMENT AND
WILL APPLY TO ANY CLAIM, DISPUTE, OR CONTROVERSY THAT ARISES
DURING OR AFTER THE TERMINATION OF THIS PURCHASE AGREEMENT.
01910/0039 135515.1 2
26.2 PROCEDURE. THE ARBITRATION SHALL TAKE PLACE BEFORE A PANEL OF
THREE RETIRED JUDGES OF THE SUPERIOR COURT OF THE STATE OF
CALIFORNIA (THE "ARBITRATORS") UNDER THE AUSPICES OF JAMS. SUCH
ARBITRATION SHALL BE INITIATED BY THE PARTIES, OR EITHER OF THEM,
WITHIN TEN (10) CALENDAR DAYS AFTER EITHER PARTY SENDS NOTICE OF A
DEMAND TO ARBITRATE (THE "ARBITRATION NOTICE") TO THE OTHER
PARTY AND TO JAMS. THE ARBITRATION NOTICE SHALL CONTAIN A
DESCRIPTION OF THE SUBJECT MATTER OF THE ARBITRATION, THE DISPUTE
WITH RESPECT THERETO, THE AMOUNT INVOLVED, IF ANY, AND THE
REMEDY OR DETERMINATION SOUGHT.
26.3 SELECTION OF ARBITRATORS. EACH PARTY SHALL SELECT A RETIRED
JUDGE FROM THE JAMS PANEL, AND THE TWO SELECTED JUDGES SHALL
MUTUALLY AGREE ON THE THIRD RETIRED JUDGE FROM THE JAMS PANEL.
IF ONE OF THE PARTIES DOES NOT SELECT A RETIRED JUDGE FROM THE
JAMS PANEL WITHIN 14 CALENDAR DAYS AFTER RECEIPT OF THE
ARBITRATION NOTICE, JAMS WILL SELECT THE SECOND JUDGE, AND THE
JUDGE SELECTED BY JAMS AND THE JUDGE SELECTED BY THE OTHER PARTY
WILL SELECT THE THIRD JUDGE FOR THE PANEL. THE THIRD JUDGE IS TO BE
SELECTED WITHIN 10 CALENDAR DAYS FOLLOWING THE SELECTION OF THE
FIRST TWO JUDGES. THE THREE JUDGES WILL TOGETHER SERVE AS THE
ARBITRATORS. IN THE EVENT OF ANY SUBSEQUENT VACANCIES OR
INABILITIES TO PERFORM AMONG THE ARBITRATORS APPOINTED, THE
ARBITRATORS INVOLVED SHALL BE REPLACED IN ACCORDANCE WITH THE
PROVISIONS OF THIS PARAGRAPH 26.3 AS IF SUCH REPLACEMENT WAS AN
INITIAL APPOINTMENT TO BE MADE UNDER THIS PARAGRAPH 26.3 WITHIN
THE TIME CONSTRAINTS SET FORTH IN THIS PARAGRAPH 26.3, MEASURED
FROM THE DATE OF NOTICE OF SUCH VACANCY OR INABILITY TO THE
PERSON OR PERSONS REQUIRED TO MAKE SUCH APPOINTMENT.
26.4 THE DECISION. ANY PARTY MAY BE REPRESENTED BY COUNSEL OR OTHER
AUTHORIZED REPRESENTATIVE. IN RENDERING A DECISION(S), THE
ARBITRATORS SHALL DETERMINE THE RIGHTS AND OBLIGATIONS OF THE
PARTIES ACCORDING TO THE SUBSTANTIVE AND PROCEDURAL LAWS OF
THE STATE OF CALIFORNIA AND THE TERMS OF THIS PURCHASE
AGREEMENT. THE DECISION OF THE ARBITRATORS SHALL BE BASED ON THE
EVIDENCE INTRODUCED AT THE HEARING, AND SHALL BE BASED ON, AND
ACCOMPANIED BY, A WRITTEN STATEMENT OF DECISION EXPLAINING THE
FACTUAL AND LEGAL BASIS FOR THE DECISION AS TO EACH OF THE
PRINCIPAL CONTROVERTED ISSUES. THE AGREEMENT OF TWO OF THE
THREE ARBITRATORS AS TO THE RESOLUTION OF THE DISPUTE SHALL BE A
CONCLUSIVE RESOLUTION. THE ARBITRATORS SHALL DELIVER THE
WRITTEN DECISION TO THE PARTIES WITHIN 30 CALENDAR DAYS
FOLLOWING THE DATE OF THE SELECTION OF THE LAST OF THE
ARBITRATORS. THE DECISION SHALL BE CONCLUSIVE AND BINDING, AND IT
MAY THEREAFTER BE CONFIRMED AS A JUDGMENT BY THE SUPERIOR
COURT OF THE STATE OF CALIFORNIA, SUBJECT ONLY TO CHALLENGE ON
THE GROUNDS SET FORTH IN THE CALIFORNIA CODE OF CIVIL PROCEDURE
SECTION 1286.2. THE VALIDITY AND ENFORCEABILITY OF THE DECISION OF
THE ARBITRATORS IS TO BE DETERMINED EXCLUSIVELY BY THE
CALIFORNIA COURTS. THE ARBITRATORS SHALL HAVE THE AUTHORITY TO
GRANT EITHER PARTY ALL REMEDIES OTHERWISE AVAILABLE BY LAW,
INCLUDING INJUNCTIONS.
26.5 PAYMENT OF ARBITRATORS. THE NON -PREVAILING PARTY SHALL PAY THE
COSTS OF ALL ARBITRATORS AND THE ARBITRATION PROCESS.
26.6 NOTICE OF WAIVER. NOTICE: BY INITIALLING IN THE SPACE BELOW YOU
ARE AGREEING TO HAVE ANY DISPUTE ARISING OUT OF THE MATTERS
INCLUDED IN THE `ARBITRATION OF DISPUTES' PROVISION DECIDED BY
NEUTRAL ARBITRATION AS PROVIDED BY CALIFORNIA LAW AND YOU ARE
GIVING UP ANY RIGHTS YOU MIGHT POSSESS TO HAVE THE DISPUTE
LITIGATED IN A COURT OR JURY TRIAL. BY INITIALLING IN THE SPACE
01910/0039 135515.1 3
BELOW YOU ARE GIVING UP YOUR JUDICIAL RIGHTS TO DISCOVERY AND
APPEAL, UNLESS THOSE RIGHTS ARE SPECIFICALLY INCLUDED IN THE
`ARBITRATION OF DISPUTES' PROVISION. IF YOU REFUSE TO SUBMIT TO
ARBITRATION AFTER AGREEING TO THIS PROVISION, YOU MAY BE
COMPELLED TO ARBITRATE UNDER THE AUTHORITY OF THE CALIFORNIA
CODE OF CIVIL PROCEDURES. YOUR AGREEMENT TO THIS ARBITRATION
PROVISION IS VOLUNTARY.
WE HAVE READ AND UNDERSTAND THE FOREGOING AND AGREE TO SUBMIT
DISPUTES ARISING OUT OF THE MATTERS INCLUDED IN THE `ARBITRATION OF
DISPUTES' PROVISION T NEUTRAL ARBITRATION.
SELLER' INITIALS
Executed as of the date first above written.
SELLER:
City of Vernon
Leonis C. Malburg, Mayor
Attest•
Malkenhorst, Jr.
Acting City Clerk
Approved As to Form
B �r i
.74�
Y•
Eric T. Fresch, City Attorney
BUYER:
Alpine Universal, Inc.
ly: lax1
and Tit e
3y:
o� cam.
01910/0039 135515.1 4