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Resolution No. 9066
1 2 3 4 5 6 7 8 10 11 12 13 NXIS 15 16 17 18 19 20 21 22 23 24 25 26 27 28 RESOLUTION NO. 9066 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF VERNON APPROVING AND AUTHORIZING THE EXECUTION OF AN AMENDMENT TO THE 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, on March 22, 2006, the City Council of the City of Vernon adopted Resolution No. 8993 approving a Standard Offer, Agreement and Escrow Instructions for Purchase of Real Estate dated March 6, 2006, together with the Addendum (the "Agreement") with Alpine Universal, Inca ("Alpine") for the sale of property located at 2301 E. Vernon Avenue in the City of Vernon (the "Property"); and WHEREAS, the City and Alpine desire to amend the Agreement to modify the Due Diligence Period of 30 days and/or the 30th calendar day in Paragraph 7.1 to 60 days and/or the 60th calendar day. 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 lfinds and determines that the recitals contained hereinabove are true and correct. SECTION 2: The City Council of the City of Vernon hereby approves the Amendment to the Agreement with Alpine, in substantially the same form as the copy which is attached hereto as Exhibit A and incorporated by reference. SECTION 3: The City Council of the City of Vernon hereby authorizes the Mayor to execute the Amendment for, and on behalf of, the City of Vernon and the Acting City Clerk is hereby authorized to 1 attest thereto. 2 SECTION 4: The City Council of the City of Vernon hereby 3 authorizes the Acting City Clerk, or his designee, to make whatever 4 nonsubstantive, administrative and/or text changes, upon advice of 5 counsel, to the Amendment. 6 SECTION 5: 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 the. Agreement, as amended. 11 SECTION 6: 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 7th day of June, 2006. 15 16 LEONIS C. MAL URG, Mayor 17 18 ATTEST: 19 20 21 BRUCE LKENHORST, JR., Acting City Clerk 22 23 24 25 26 27 28 2 - 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 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. 9066, was duly adopted by the City Council of the City of Vernon at a regular meeting of the City Council duly held on Wednesday, June 7, 2006, and thereafter was duly signed by the Mayor of the City of Vernon. Z--� (SEAL) 1 BRUCE ALKENHORST, JR. Acting City Clerk - 3 - Amendment to that certain Standard Offer, Agreement and Escrow Instructions for Purchase of Real Estate dated March 6, 2006, together with the Addendum attached thereto (hereinafter collectively "Agreement") RE: 2301 EAST VERNON AVENUE, VERNON, CA 900S8 Date: May 4, 2006 1. Whereas, the parties hereto, have entered into the Agreement referenced above, and now agree to amend said Agreement as follows: a. The 30 day period and/or the 30t" calendar day reference in Paragraph 7.1, Page 2 of the Agreement is hereby corrected to read: "...........the 60t" calendar day after the Date of Agreement (which 60 day period shall be extended to the next business day if it ends on a Friday, weekend, or holiday) (the "Due Diligence Period"." *****ALL OTHER TERMS AND CONDITIONS SHALL REMAIN THE SAME.***** EACH OF THE UNDERSIGNED STATES THAT HE/SHE HAS READ THE FOREGOING INSTRUCTIONS AND UNDERSTANDS THEM AND DOES HEREBY ACKNOWLEDGE RECEIPT OF A COPY OF THESE INSTRUCTIONS. EACH OF THE UNDERSIGNED UNDERSTANDS THESE INSTRUCTIONS MAY BE EXECUTED IN COUNTERPARTS, ALL OF WHICH WHEN TAKEN TOGETHER SHALL BE DEEMED TO BE THE INSTRUMENT. SELLER: City of Vernon, a body corporate and politic By: Bruce V. Malkenhorst, Jr. Its: Acting City Clerk Approved as to form: By: Jeff Harrison, for Karns & Karabian, General Counsel BUYER: Alpine Universal, Inc., a California corporation By: James H. Schladen, President To: Nelly Giron,Deputy City Clerk From: Willard G. Yamaguchi, Chief Deputy City Attorney/Acting Ris Manager Date: 8/9/2006 Re: Escrow No. 227049-TD - Sale of 2301 E. Vernon Avenue Property to Alpine Universal, Inc. Attached for your records is a copy of the following regarding the above -referenced sale that was approved by Resolution No. 8993, as amended by Resolution No. 9066: 1. Final Closing Statement dated August 4, 2006; 2. Copy of Seller's completed and executed Seller's Affidavit of Non -Foreign Status; 3. Copy of Seller's completed and executed 593-C; 4. Counter -signed Amendment dated July 28, 2006; 5. Counter -signed Amendment dated May 4, 2006; 6. Counter -signed Escrow Instructions dated May 4, 2006 (Revised May 5, 2006) ; 7. Fully executed Property Information Sheet; 8. Fully executed Seller Mandatory Disclosure Statement; and 9. Counter -signed Summary page 2 of LGS Report No. 4183328 with complete report. Attachments N TLE OAN 520 North Brand Boulevard Glendale, CA 91203 PHONE: (818)240-4912 FAX: (818)551-5361 SELLER CLOSING STATEMENT FINAL BUYER: CITY OF VERNON, A BODY CORPORATE AND POLITIC ESCROW #: 227049-TD ESCROW BRANCH: GLENDALE ESCROW ESCROW OFFICER: TINA DE BOW PREPARER: TINA DE BOW DATE PREPARED: 8/4/2006 PROPERTY: 2301 EAST VERNON AVENUE CLOSE DATE: 8/4/2006 VERNON, CA 90058 Debit Credit, Total Consideration Total Consideration $8,350,000.00 Commissions Commission to CUSHMAN & WAKEFIELD OF CALIFORNIA $334,000.00 Additional Charges Disclosure Fee to LGS REPORTS, INC. $79.95 Title Charges Owners Policy to NORTH AMERICAN TITLE $2,145.00 Recording Fees $9,185.00 $9,185.00 County Transfer Tax Escrow Charges Settlement Fee to NORTH AMERICAN TITLE $2,922.50 Special Messenger/Courier Fee to NORTH AMERICAN TITLE $50.00 wire fee to NORTH AMERICAN TITLE $25.00 Sub Total $348,407.45 $8,350,000.00 Proceeds Due Seller $8,001,592.55 Totals $8,350,000.00 $8,350,000.00 SAVE FOR INCOME TAX PURPOSES 520 North Brand Boulevard Glendale, CA 91203 PHONE: (818)240-4912 FAx: (818)551-5361 TripleTek Enterprise Settlement System 4303 SellOpLtr.doc pRo, PE%TY pNFO MAMON SHMT AIR Commerr. ml ia! 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PA - t>ae Jay �6Ov06 �owp "Monvabip brWe 'V, Wka oTst, 3r . tnor A_etinft _gM.clerk Buyer boteby aeknowlcdgos-tmipt of this property hlfbntration ShCel on August 1, 2006, and iurillor agrees thgt this August 1, 2oo6 Prop Tc , lnfbn mtion ."+heel, haalu ft Exhibit A (2 pa9m), is tho Mole and entire Property wormaatian cot aeknowl rep]aces nll prior dMXU mtd •9'ctaaians of tho Properly lnformation Shect, a T n %tgcd by Buyer and superscdcs and PAWAtxm Mat -Am L- KI.A u.oarAmwoocamaaoa r'EMM-440a )3xhi'hit ".A„ to Property Infomation. Sheet 2301 Vernon Avenue, City of Vernon, State of California City of Vcmon (Seller) and Alpine Universal, Inc. (Buyer This Pto erly (Which, fox purposes of this Exhibit "A" includes ah buildin g, structures, and improvennrtl% and all buiIdiog Mtecros and equipment, including beating, plumbing, sewer systoan, loading doors, electrical and lighting systems, fi'xe sad lifo safety systems, security systems, and we IFmical equipmmt) is being gold "AS IS, WHERE IS, AND WITH ALL P,AULTS". Selltlr has recently acg" the Property, and therefdra has limited knowledge in regard to the: corliiition of the Property. )Buyer acl nowledges that, prior to the Close of, Esorow, it will have had the opportunity to inspect the Prt'rperty and to satisfy itself as to the condido.n ofthe Property. Myer is retying sOlely and excluAvaly on its own Imowledge of the condition of the Property and its own inspections, if my, and waives any claims against Seller for any faults or defects on the P mperty, inoluding the miftence of any Hazardous Substance that nnay be in, oo, wader, or around the Property. Seller has not made any representation or waamty as to the "Property Condition". "Ptoperty Condition" means and refers to each and every Matta of conom or relevance to Buyer relating to the P.ropetty, i nchxd4 without limitation, the condition of title, the physical, geologioxl and esMromnental condition of the Property; soib stability and amdition; compliance (and-non-compUbce) with applicablo govertuneutal laws, regulations, and zoning and building codes, including sty possible changes in zoning or building codes that could adversely affect the use of the Propcal(t the fitness of the erty for Buyer's contemplated use, the pxesenco of lWardous SubstlMecs; the square footago of the Pmporty or tho building, lot )laces or boundaries; and the value of the Property. Under w ft tc cover, Seller has provided Buyer with cerwin reports, studies, and allRlyses regarding the environmental conditions at the Pmpexty. That Iota also advised the Buyer that the Sella has a permit file cottgi bg of weral hundred pages ofpmmits and other documentation relhtcd to the Property that is open to inspection and reasonably copying, Buyer acknowledges that certain oftice property infottxaation materials provided to Buyer concerning the condition of tli:E Property were prepared by third parties. Seller has not independently investigated any Monnation included in such third party studies or reports grad has not wade and does not make an;`� reprmentati= or warranties raegardmg the truth, accuracy or completeness of the information t hde available to Buyer in such studies or reports. Buyer ackmowledges ,receipt of the docum*_ Exhibit "A" to Property ha& marion Sheet 2301 'Vernon Avenue, City of Vernon, State of California City of Vernon (Seller) and Alpino Universal, Ifnc, (Buyer) Without affecting the obligaxion and responsibility of Buyer to satisfy itself as to the condition of the Property, Buyer is hereby advised of the following facts that were disclosed to Seller by the pndf owner of the Property: 1. The buildings were built in the 1940's and were constructed of metal, brick and concrote- Buyer to ,aerify the condition of the buildings. 2_ The priovowner did not twe tha 14VAC in, the second story of each building. Buyor to verify condition of HVAC. 3. can accwim, t-h=. has bccn some ponding in front of the rail dock and between the warehouse and plant building. 4_ The priQr owner may have used some substances that are classified as hazardous materials associated with their business. Please see Phase I dated September 11, 2003 f ni Sml%, -Bmery and the Phase 11 dated October 15, 2003 from Smith -Emery. 2 SELLER'S {MANDATORY DISCLOSURE STATEMENT (Required by law on frB)?WCfions involving non-residenliel properties in Csflfomia) DO NOT USE THIS FORM WITH REGARD TO THE SALE OF RESIDENTIAL PROPIrR77ES AIR Commercial Real Estate Association 'flee d1W"' etaterouR� _s..I,n�t�ur�dh,eadtr to be a Pat all* Y0 srAI MR[l.OFFER AWR6"N'T MX1 ESCROW INSTRWMNS FOR PUMtCt1ABE OF WAL ESTATE (Bee ! "r 7 1(a) al sold OOCLenerd) w Q in order IO wwfth Stelb law coneemlrg7 dlbdos" talk o a POINOW puue3heser. Swat alerts by tnpy the AIR, hk Jtp Gsotaoda (f100) 748.5=. A cow O A. tNBlze a report prepared by a prrdesslalat mraalauht vduldt hse bean approved t of their report is aftwMd herslo. (ConlPIsie pu'agr> b, B, 9 end 1e ens sign Oft SfateMM In the plus Pn> vfdaQ Id B, vdllxe a tOpae prot> by a tllffaaht ahn,rWtent, k, LGS REPORTS 9 artd 18, sign We famflM Yh the �) A cagy Of their ";get, Wagnl� 8. plow � andaWchacopyof1beC nvsersteiVY0rha's previously ' been provided, O C. (,onvow ads Dledosura stalement wWOA the aeaGtsnoa d a profa""M'mWurb (COr� IOI POMF ' � Sato12 -d sign this t Warrant In the blare pro+rMed Remember toatgOh a Dopy of rlha Cobtroercfaf pm" 1. FARTHOuAMFAULT ZON93• IfBwPropurtylsloeetedrdtlhlnahiefneatWEarthquakeFatetZ�ne(amnsThatOruoomp8eeesaPoland* or recently wtwo u� of an eampubm buh that le deemed by fa t)atfe 6NU& tom a �W aw �ta am �p�LM k located W" rf or feuk awl C 11romla Kit Rasosvoes Code §2821 at wq rrherudatee repi� Wd ge01cgIxL In maldonco with such law, DWarls hereby such a Zan+, and that Its dgeeto row t "M requirg ■ geoingic roWrom kdhxmad thak fm Propedv is O or Is hoc Cl ~ q daeneaad MalftuaRe Fault Zane. 2. sE16MIC HAZARD ZONES. fl the Property k located wBhln a Sahusl0 Pleased Tons es delineated on a sap d fhb Caiwity Maim of Mina and Geology, CeWPanle puWla Resaurays Cade POO st seq. Mendable Bid PtdeP�e taaOWtaeers � adv d that the Properly is located wtlran such a ZOne. In eworddrvb wilt ha0h WN, Beyer is hereby ~04 that the PrOpedit Is O wle not ❑ W" a 241swo Huard Zone. S. 9A(tf1quA1ES4iET►. x(OorweteariaLt(oW the Irmoro"rMis o11ft ngaileS�o9ether> P6fmortookoror to 197S, end 01t�mt�slnf mdmaoogrybmwells. sWCWres WM (q pre -cog ( Ii•, HPMP) ivy a Cukk t0 Earff*X os sate IAe 'Bolder) PUWttdhod by Bn GaAforrda. . BBuuy�reerr treat be, Flamm VA a ropy of The cmawdal PrcPertt OArr� �` Salomlo safolycommkddn. Buyer is tromby Irdohned thetthe I'MPerh': FArB ghp>ite Wh,udonese ppdmuro ❑ , (&)Mesta the fora9dng.►egtdramerda. and s Copy the BoOldat and a >� "Canmerclal Propah R4porf' is attaraad hereto. within five bualraM deyt of 8uY4f a tetxNht rif enid Dledoehna Report Buyer a tit gw a du p riot do alyn le copy t the sauna te Eeeraw Fbidx. wkh a copy b Sslldrord t3ellaPe Broimr,�uuOhp War and by 1nsW teed Trier ltMt tiOrgv ShsP nm does unless and un81 dim* Holder hseYsraked fha olsdmwe Report uWY tin by 0(b)daeaeelmeetthe iharegningrooVeMsnisraqulMOthe damyOil* OMMOL 4 FIRs pnoTCf10N. It the Ywp M is loaded olden a dealgnowd Broke Aaspor AN Arse a6 4apnaabe OII s d! that t fttkPM by the CeW OMIT Department of Forestry, Caffomla Fubid Romeo" Code 54138 �datee fled prooperutve phadaoere be advised! But the Property Is loaned nV*hlnsw a wf and Brae whidt may y be b� to di � r dole, Ou PM whlsh J"UN" the ic Wav+all prOteodon eiak*P, and flit Ella P lm W rMy bosh, the makp.rhmscd of ttrebrealta. wild OBter earner aeB+ldes. in Aceordense wWh Welt law, Bvfs1 q )hereby Informed Brat mo Properly Is U3 0r k pot O witlhln A deslpneted BMus Responalbiliy Area. 6 FlRE FLAZAftD. h the Prop etY k lorete4 within en &roe dWOnadud 1kt a vary High Fire Hazard SWeriq Zan p4rglsnt to GavPropert code §81178 at wq, J$1183.5 rnw"w that FMPetdtw ptuc roam be advised MA the Property is lodited wllhkt Ouch AZPM end Bust the Properly May be sub)sr:m vadow makntenerwo, dodge Now owswetlan mqukaNWp andior r4suietlrrer. In acooidenoe W% such law, Buyer Is hereby Infarmod thatum FrcparU' is O crIs not M whin n designated very High Fire Hama S4Yedfy Zona k located within an area of polent W fcodhtg In line the jailum Of 0 dam adeisad that m B. AREA nd lan Map 401 FLOOOBurs lithe PtoPa►Y A mandates Brat Pmall dw &hope Ott rut me d%Ban mac daaiOWL pursuant to with u such l Code ye� Is ro by W thatula PMPW IA O or k rat O w * a dwWgnated Property to located within ouch an area. to ecooraanoe wIW artYu taw. Euyer k henebY UtWotrtled area of PONmW fcadtng. ' 7, ROOD HAZARD AREAS, it he PropkV is 1000W Woo a detdpnMed Fadaml F1004 N� Aran ea delkheefad On a MOP )ued cby Bha federal En NUK03Y Atenagernvnt AaemYr Federal hew, Is. 42 u s.t; !)4104a, rnandefee toad prohqueruWr purchasers he n1lMAI; diet the iropssrly islovAm an oroe having epeokt food Fhemrdo aid that 80M Inearanoe MW 6s mquW ere a c"Wito" to obmkring fkuartOing• in a°o°rdan oted as with such law, Buyer k haedy Inft-1 f)af 0* E'mwW Is 0 ar Is Act ❑ within a dealQnaled federal FbOd Flaunt Aram, S . D14ASTER IJSURANCE. B the timer of S-Wr predoc"mr4n4n Brost has prevWAY ra0elved Federal 1100d disaufar ehadtienee - end exam be advkad Braeth Y +aWitto N> wtlh ioance on Bie g lived InwXww* an Us Ro�rty atd twtWOW Baddathshsan0r Is not mdr�utadPAGE 1 OF 2 IN *JOSS • AIR COMMERCIAL REAL ESTAT9 A5BDMT10N � PORteaLfD��rwle aw FW be WWred to reknhwsa rho Fod"W Govaraderd for the disill aOf the Praparw k Uhehssaer darns ed by a aood dt "W, Purduesr Fe lord Illw dW W p t" 13 orthaa not N been Pre�N provided. Buyer b thataby pyaerhad that m Heebvd�i d�fses�ter late beanh rrteaNed, tw raw cWdlet that the raquVad nod be �p»4dnad 1n rewh"d wmh regard to the propady. Nde= dbwnerda WdmxlAg the Vanstar of camoMhlp'. 9, WATER HEATER fjRACINs t tM Property =Oka one or nor -tat heelsla, Seller k requlhad ric vAdflow. BW and r a y a Cade §19211 m �.* m the Bhrynt to Ell eons' water huam have been braced, elrlhppad WOW arkluxed In aooadanea Hdth low. Bhq®r I6 hmebY adNsed eat to regUYad t afJrW, 5WPM9 arWrar Andrus 1htNa d or have Iet l been kdstafled, and tha mold ehher 10. PREAENCE OF MOLD. t da salver or Var<+a,w of WPOM WAwm d the prase 201 ej r>d trek prwoodhe are ba axcaedc pannhslds aa[POsufa 9rtdes ar po"A ■ thesidh ffiraet W. S M a h@r by Ida does.0 or dose not iamw of Ina *&roil In WfMn9 of aueh mold. In aoaoadartrs N1th such laW, BUYd' presanoe of such MOM etedw the Pfopelty. M the evert tttd the Pufduee A9reelfhent does not at proean< provWa that ttla IneuranCe w1Y to abralrhed, Buyer Is 11. TITLE INSURANCE In e W nt 1111 hra, and, kh DW danCo WM Cs9foMa OMI Cads p0g,$, is aduteed sa follows ahwtyly urged m ronWdsr p,adas 9 IMPORTANT: IN A PURCHASE OR Et(GHANGE OF p"L PROPERTY, VT MAY BE ADVISABLE TO OOTAIN TITLE INSURANCE IN CONNECTION W7H RiE CiD61: ESCROW yblt�THME MAY BE PRIOR RECARDFA LIENS AM%ENO BE OV INED IN O AFFECT YOUR tNTEMT YOUR IN THE PROPERTY BEING ACOUIREO. A NEW POLICY OF TITLE INSURANCESHOULD BE OBTAINED IN OfrO%Ff TO ENSURE YOUR INTEREST IN THE PROPERTY THAT YOU ARE ACLIUIRINd. 12. OTHER• PLEASE NOTE: the appl(table While the Irdamet0n conhrked In or*441 to 10 0(adoatrte 9latartunr k the' a from tma tQ VM,, Nor b the lose at 98CM,, BlryeAt It waq PT r may M1uh to team and tha areas Mwid by the vadon "1wel 11=1d 20191 ifG can G12V19 tare oerabtathed nabnall huard zarea In she* the slaws of the ProW W. Also. the etly andlor county In wtdah tte Prop+*+ �k lamlad mal' adman l0 arose e4[ed above 906103. Buyar b adNeod b obbo M the aPProPath tons' fey a The pn m e0ntalrmd wRhln the abm d100101hee raoraphs aft not Intsndad to W toll end eempinta dieearboaps of all of the pcae]* ramllkatae to the Skw andfor W the Pr*PwIY, the event that this doo moerd bWkn es that the PrapaTly is dleclad kw one or ,yam o fyb dbduuauna, &yder le e04k00107 f. Revaw nhe app9wble latua m 1w 149 n W a seek advme of counsel as I% t G9al w and uepas of the wmc d d a1 dMVxu� I Rahla Appropriate osnwlbnts to Tevbur end lnveat9ate ttw bdpeCt d or recoraswpdsIIon la nhAda by t o AIR Goromardsl Rawl gefats ptsoclaflon or by achy btekar to to tte 1e9e1 "MLDWdW , nPta+mst r Or iylflNuhsY,taW�lhaffect.ofc- w1ncfssollMcdodrmentaithe PerohaaaA � I+ttawhlotlR a - DatR: SELLER HOTS: These forrM am otlsn dwedMed to meet char OR11 fh you anptlovthe moatMe— form:AmcoYMERCIAL 90a17. (213) W4777. PMJE 2 OF 2: IHIiIArs VMS •AIR COLWERCL4L RFALWATa ASSOCIATION of the IndiKtry. AWrsp drove or call to pdake iwe . 710 S- p("w SbvK Suitt aa9, L- Angeles, Cellf. FORM SHID3.8W Page: 2 of Date: May 9, 2006 LGS Report`No.: A183328 NATURAL HAZARD DISCLOSURE' STATEMENT Property: 2301 E Vernon Ave, LosAngeles, CA 90058,1608 APN: 6302-017-907 Transferor. Vernon'City The transferor and his or her agent(s) disclose the following information with the knowledge: that even though ibis is. not a warranty, prospective transferees may rely on this information in deciding whether and on what terms to purchase the subject property. Transferor hereby authorizes any agenl(s) representing any principal(s) in this action to provide a copy of this statement to any person or entity in connection with any actual or anticipated sale of•the property. The following are representations made by the transferor and his or heragent(s) based on their knowledge and: maps:drawn by the state and federal goverments. This information Is a disclosure and.is not Intended :to.be;part of contract between and _the ransferor. THIS REAL PRO.PERTYLIES WITHIN THE FOLLOWING HAZARDOUS AREA(S): (Check the answer that applies) A SPECIAL FLOOD HAZARD (Any type Zone "A" or'V"):designated by the Federal Emergency ManageinentAgency, Yes ! No ✓ V (a) Do nol know (0) Information not available from loco(jurisdiction --- — Only Check: lf-BOTH (a) and (b) apply. -- _ AN AREA OF POTENTIAL FLOODING shown on a dam failure"inundation map pursuant to.:Section-8589.5 of the Government Code. Yes ✓ No (a) Do not know (b) Information not available from Ideal jurisdiction' `— Only Check if BOTH (a) and(bapply. - A VERY HIGH FIRE HAZARD SEVERITY ZONE pursuant to Section 51178 or b.1179 of the Government Code. The owner of thls.propertyis subject to the maintenance requirements to�Sectlon 51182 of the Government Code. Yes No ✓ A WILDLAND.AREA THAT MAY CONTAIN SUBSTANTIAL FOREST FIRE RISKS AND -HAZARDS -pursuant to Section 4125,of the Public Resources Code. The owner of this properlyis subject to.the maintenance requirements of Section4291 ofthe Public' Resources:Code. Additionally, it is not the state's responsibiliiydo provide fire protection services to any building, or structure located within lho Wifdlands unlessahe Department of Forestry=and Fire Protection .has entered into;a cooperalive agreement with a local agencyfor those pursuantto,Section 4142 of the Public ResourcesCode. Yes No AN EARTHQUAKE FAULT:ZONE pursuant to Section1622 of the Public Resources -Code; Yes No y A. SEISMIC HAZARD ZONE pursuant 16Section 2696 of the Public:Resources Code. Yes .(Landslide Zone) Yes (Liquefaction.Zone) No ✓ No ✓ Map.nbt released by state Map not released:by.stale ~V THESE HAZARDS MAY LIMIT YOUR ABILITY TODEVELOPTHE REAL PROPERTY, TO OBTAIN INSURANCE, OR TO RECEIVE ASSISTA.NCE.AFTER A DISASTER. THE MAPS ON WHICH THESE DISCLOSURES ARE BASED ESTIMATE WHERE NATURAL HAZARDS EXIST. THEY ARE NOT DEFINITIVE INDICATORS OF WHETHER OR NOT A PROPERTY WILL: BE AFFECTED BY A NATURAL DISASTER. AND TRANFEROR(S) WAY WISH TO OBTAIN PROFESSIONAL ADVICE REGARDING THOSE HAZARDS AND OTHER HAZARDS THAT MAY AFFECT THE PROPERTY. The representations made in this NHD form and report are based upon information provided by an Independent third partyreport provided: as a substituted disclosure pursuant to California Civil Code;§Section 1103.4. Neilher.the seller nor the seller's egent hes (1) independently verified the information contained. in this form and report or (2) is: personally aware _of'any errors.or inaccuracies in,the information contained on1he form. Tranferor represents that the information; herein"is.true and correct to the best of the tranferor's knowledge:es of the,dale.signed by the transferor. Sign ahrreof'I'ransferor Date Agentrepresents that the Info r a ion herel is it e n rectto the best of thee agent's knowledge as of the date signed by the agent: Signature of Agent'�nlc• Signature of Agent Date Transferee represents lhathe or she has read and understandsthisdocument. St natoreofTransferee Date Names H. Seh1-adeil-.........---_.----- ....-- --- This form meets the standards of civil code §1103. No representation is made as to the legal validity or adequacy of any provision in anyspecific transaction. Areal estate broker is the person qualified to advise on real estate. transactions. If you desire legal or tax advice, consult an appropriate professional. V 2006-LGS Reports, Inc. 27200 Agoura Rd. Suite 200 Calabasas•Hllls, CA 91301 Tel 800.814.5509 Fax: 800.547.6566 vnvv.LGSReports,com CROtOo Page: 2 of 6 Date: May 9, 2006 LGS Report No.: 4183328 NATURAL HAZARD DISCLOSURE STATEMENT Property: 2301 E Vernon Ave, Los Angeles, CA 90058-1608 APN: 6302-017-907 Transferor. Vernon City The transferor and his or her agent(s) disclose the following information with the knowledge that even though this is not a warranty, prospective transferees may rely on this information in deciding whether and on what terms to purchase the subject property. Transferor hereby authorizes any agent(s) representing any principal(s) in this action to provide a copy of this statement to any person or entity in connection with any actual or anticipated sale of the property. The following are representations made by the transferor and his or her agent(s) based on their knowledge and maps drawn by the state and federal goverments. This information is a disclosure and is not intended to be part of any contract between the transferee and the transferor. THIS REAL PROPERTY LIES WITHIN THE FOLLOWING HAZARDOUS AREA(S): (Check the answer that applies.) A SPECIAL FLOOD HAZARD (Any type Zone "A" or "V") designated by the Federal Emergency Management Agency. Yes No ✓ (a) Do not know (b) Information not available from local jurisdiction Only Check if BOTH (a) and (b) apply. AN AREA OF POTENTIAL FLOODING shown on a dam failure inundation map pursuant to Section 8589.5 of the Government Code. Yes ✓ No (a) Do not know (b) Information not available from local jurisdiction Only Check if BOTH (a) and (b) apply. A VERY HIGH FIRE HAZARD SEVERITY ZONE pursuant to Section 51178 or 51179 of the Government Code. The owner of this property is subject to the maintenance requirements to Section 51182 of the Government Code. Yes No ✓ A WILDLAND AREA THAT MAY CONTAIN SUBSTANTIAL FOREST FIRE RISKS AND HAZARDS pursuant to Section 4125 of the Public Resources Code. The owner of this property is subject to the maintenance requirements of Section 4291 of the Public Resources Code. Additionally, it is not the state's responsibility to provide fire protection services to any building or structure located within the wildlands unless the Department of Forestry and Fire Protection has entered into a cooperative agreement with a local agency for those pursuant to Section 4142 of the Public Resources Code. Yes No ✓ AN EARTHQUAKE FAULT ZONE pursuant to Section 2622 of the Public Resources Code. Yes No ✓ A SEISMIC HAZARD ZONE pursuant to Section 2696 of the Public Resources Code. Yes (Landslide Zone) No ✓ Map not released by state Yes (Liquefaction Zone) No ✓ Map not released by state THESE HAZARDS MAY LIMIT YOUR ABILITY TO DEVELOP THE REAL PROPERTY, TO OBTAIN INSURANCE, OR TO RECEIVE ASSISTANCE AFTER A DISASTER. THE MAPS ON WHICH THESE DISCLOSURES ARE BASED ESTIMATE WHERE NATURAL HAZARDS EXIST. THEY ARE NOT DEFINITIVE INDICATORS OF WHETHER OR NOT A PROPERTY WILL BE AFFECTED BY A NATURAL DISASTER.TRANFEREE(S) AND TRANFEROR(S) MAY WISH TO OBTAIN PROFESSIONAL ADVICE REGARDING THOSE HAZARDS AND OTHER HAZARDS THAT MAY AFFECT THE PROPERTY. The representations made in this NHD form and report are based upon information provided by an independent third party report provided as a substituted disclosure pursuant to California Civil Code §Section 1103.4. Neither the seller nor the seller's agent has (1) independently verified the information contained in this form and report or (2) is persorfally aware of any errors or inaccuracies in the information contained on the form. Tr feror represents that the infd� ation herein is true and come o the best of the ranferor's knowledge as of the date signed by the transferor. ignature of Transferor �^—®` ate - 41 Bruce V. Malkenhor. , Agent represents that the infor ti herein Is true •and correct to the bes of theelent's knowledge as of the date signed by the agent. Signature of Agent Signature of Agent Date Date Transferee represents that he or she has read and understands this document. Signature of Transferee Date This form meets the standards of civil code §1103. No representation is made as to the legal validity or adequacy of any provision in any specific transaction. A real estate broker is the person qualified to advise on real estate transactions. If you desire legal or tax advice, consult an appropriate professional. 02006 LGS Reports, Inc. 27200 Agoura Rd, Suite 200 Calabasas Hllls, CA 91301 Tel 800-814-5599 Fax: 800-547-5566 www.LGSReports.com CRO105 Page: 2 of 6 Date: May 9,.2006 LGS Report No.: 4183328 NATURAL HAZARD DISCLOSURE STATEMENT Property: 2301 E Vernon Ave, Los Angeles, CA 90058-1608. APN: - 6302-017-907 Transferor: Vernon City The transferor and his or her agent(s) disclose the following Information with the knowledge that even though this is not a warranty, prospective transferees may rely on this information in deciding whether and on what terms to purchase the subject property. Transferor hereby authorizes any agent(s) representing any principal(s) in this action to provide a copy of this statement to any person or entity in connection with any actual or anticipated sale of the property. The following are representations made by the transferor and his or her agent(s) based on their knowledge and.maps drawn by the state and federal goverments. This information is a disclosure and is not intended to be part of any contract between the transferee and the transferor. THIS REAL PROPERTY LIES WITHIN THE FOLLOWING HAZARDOUS AREA(S): (Check the answer that applies.) A SPECIAL FLOOD HAZARD (Any type Zone "A" or "V") designated by the Federal Emergency Management Agency. Yes No ✓ (a) Do not know (b) Information not available from local jurisdiction Only Check if BOTH (a) and (b) apply. AN AREA OF POTENTIAL FLOODING shown on a dam failure inundation map pursuant to Section 8589.5 of the Government Code. Yes ✓ No (a) Do not know (b) Information not available from local jurisdiction Only Check if BOTH (a) and (b) apply, A VERY HIGH FIRE HAZARD SEVERITY ZONE pursuant to Section 51178 or 51179 of the Government Code. The owner of this property is subject to the maintenance requirements to Section 51182 of the Government Code. Yes No A WILDLAND AREA THAT MAY CONTAIN SUBSTANTIAL FOREST FIRE RISKS AND HAZARDS pursuant to Section 4125 of the Public Resources Code. The owner of this property is subject to the maintenance requirements of Section 4291 of the Public Resources Code. Additionally, it is not the state's responsibility to provide fire protection services to any building or structure located within the wildtands unless the Department of Forestry and Fire Protection has entered into a cooperative agreement with a local agency for those pursuant to Section 4142 of the Public Resources Code. Yes No ✓ AN EARTHQUAKE FAULT ZONE pursuant to Section 2622 of the Public Resources Code. Yes No ✓ A SEISMIC HAZARD ZONE pursuant to Section 2696 of the Public Resources Code, Yes (Landslide Zone) No ✓ Map not released by state Yes (Liquefaction Zone) No ✓ Map not released by state THESE HAZARDS MAY LIMIT YOUR ABILITY TO DEVELOP THE REAL PROPERTY, TO OBTAIN INSURANCE, OR TO RECEIVE ASSISTANCE AFTER A DISASTER. THE MAPS ON WHICH THESE DISCLOSURES ARE BASED ESTIMATE WHERE NATURAL HAZARDS EXIST. THEY ARE NOT DEFINITIVE INDICATORS OF WHETHER OR NOT A PROPERTY WILL BE AFFECTED BY A NATURAL DISASTER.TRANFEREE(S) AND TRANFEROR(S) MAY WISH TO OBTAIN PROFESSIONAL ADVICE REGARDING THOSE HAZARDS AND OTHER HAZARDS THAT MAY AFFECT THE PROPERTY. The representations made in this NHD form and report are based upon information provided by an independent third party report provided as a substituted disclosure pursuant to California Civil Code §Section 1103.4. Neither the seller nor the seller's agent has (1) independently verified the information contained in this form and report or (2) is personally aware of any errors or inaccuracies in the information contained on the form. Tranferor represents that the information herein is true and correct to the best of the tranferor's knowledge as of the date signed by the transferor. Signature of Transferor Date Agent represents that the information herein is true and correct to the best of the agent's knowledge as of the date signed by the agent._ Signature of Agent Date, Signature of Agent Date Transferee represents that o as r u erstands this document. Siggnature of Transferee Date �� James H. Schl e W LAW This form meets the s nda s f vil code §1103. No representation is a e as o the legal validity or adequacy of any provision in any specific transaction. A real estate broker ' the er on qualified to advise on real estate transactions. If you desire legal or tax advice, consult an appropriate professional. 02006 LGS Rep r1s, Inc. 27200 Agoura Rd. Suite 200 Calabasas -Hills, CA 91301 Tel 800-814-5599 Fax: 800-647.6566 www.LGSReports.com CRO106 Page: 1 of 6 Date: May 9, 2006 LGS Report No.: 4183328 NATURAL HAZARDS DISCLOSURE REPORT FOR LOS ANGELES COUNTY Property: 2301 E Vernon Ave, Los Angeles, CA 90058-1608 APN: 6302-017-907 Transferor: Vernon City This report discloses information regarding the property address identified above (Property) that is based upon review of the maps and data cited within. Other publicly available data not reported within this report may also pertain to the Property. If site - specific information for the Property is required, a Certified Engineering Geologist or licensed Professional Engineer should be retained to conduct an investigation. In addition, geotechnical and other reports pertaining tq the Property may be on file with the city or county and. should be reviewed if site -specific information for the Property, is required. Site -specific information may enhance or modify some of the information contained in this report. This report is compiled in accordance with all conditions and limitations stated within. The following pages contain an .explanation of each disclosure category reported on this page. THIS PROPERTY IS REPORTED AS: Not Situated in a special FLOOD HAZARD AREA (Any, type Zone "A" or " V") designated by the Federal Emergency Management Agency; Situated in a DAM OR RESERVOIR INUNDATION AREA designated by the State Office of°Emergency Services; Not Situated in a State of California VERY HIGH FIRE HAZARD,. SEVERITY ZONE; The owner of a property within a Very High Severity Zone is subject to the maintenance requirementsofSection §51,182 of the Government Code; Not Situated in a State of California'FIRE RESPONSIBILITY AREA. The owner of a property in a State Fire Responsibility Area is subject to the maintenance requirements oUSection §4291 of the Public Resources Code; Not Situated in a State of California Alquist-Priolo EARTHQUAKE FAULT ZONE; Mapped by the State of California Division of Mines and Geology SEISMIC HAZARD MAPPING ACT program; Not Situated in an Earthquake -Induced LANDSLIDE HAZARD ZONE on official maps of the Seismic Hazard Mapping Act; Not Situated in a soil LIQUEFACTION HAZARD ZONE on offical maps of the Seismic Hazard Mapping Act; Scott M. Roecklein, Sr. Vice President LGS Reports, Inc. 4183328, 6302-017-907, 674-H3. , LAND DESC INDOC 1986372,040803 POR SH, OSMM, 319/1006 © 2006 LGS Reports, Inc. 27200 Agoura Rd. Suite 200 Calabasas Hills, CRo106 g C_A 91301 T-eI-800-814-5599-Fax: 800=547=6566 �rww:CGSReporls.com Page: 2 of 6 Date: May 9, 2006 LGS Report No.: 4183328 NATURAL HAZARD DISCLOSURE STATEMENT Property: 2301 E Vernon Ave, Los Angeles, CA 90058-1608 APN: 6302-017-907 Transferor: Vernon City The transferor and his or her agent(s) disclose the following information with the knowledge that even though this is not a warranty, prospective transferees may rely on this information in deciding whether and on what terms to purchase the subject property. Transferor hereby authorizes any agent(s) representing any principal(s) in this action to provide a copy of this statement to any person or entity in connection with any actual or anticipated sale of the property. The following are representations made by the transferor and his or her agent(s) based on their knowledge and maps drawn by the state and federal goverments. This information is a disclosure and is not intended to be part of any contract between the transferee and the transferor. THIS REAL PROPERTY LIES WITHIN THE FOLLOWING HAZARDOUS AREA(S): (Check the answer that applies.) A SPECIAL FLOOD HAZARD (Any type Zone "A" or "W) designated by the Federal Emergency Management Agency. Yes No ✓ (a) Do not know (b) Information not available from local jurisdiction Only Check if BOTH (a) and (b) apply. AN AREA OF POTENTIAL FLOODING shown on a dam failure inundation map pursuant to Section 85895 of the Government Code. Yes ✓ No (a) Do not know (b) Information not available from local. jurisdiction Only Check if BOTH (a):and (b) apply: A VERY HIGH FIRE HAZARD SEVERITY ZONE pursuant toection'.51178 or'61179 of the Government Code. The owner of this property is subject to the maintenance requirements to Section 51182 of the Government Code. Yes No A WILDLAND AREA THAT MAY CONTAIN SUBSTANTIAL FOREST FIRE RISKS AND' HAZARDS pursuant to Section 4125 of the Public Resources Code. The owner of this property is subject to the maintenance requirements of Section 4291.of the Public Resources Code. Additionally, it is not the state's responsibility to provide fire protection services to any building. or structure located within the wildlands unless the Department of Forestry and Fire Protection has entered into a cooperative agreement with a local agency `foe those pursuant to Section 4142 of the Public"Resources Code. Yes No ✓ AN EARTHQUAKE FAULT ZONE pursuant to Section 2622 of the Public Resources Code. Yes No ✓ A SEISMIC HAZARD ZONE pursuant to Section 2696 of the Public Resources Code. Yes (Landslide Zone) Yes (Liquefaction Zone) No ✓ Map not released by state No ✓ Map not released by state THESE HAZARDS MAY LIMIT YOUR ABILITY TO DEVELOP THE REAL PROPERTY, TO OBTAIN INSURANCE, OR TO RECEIVE ASSISTANCE AFTER A DISASTER. THE MAPS ON WHICH THESE DISCLOSURES ARE BASED ESTIMATE WHERE NATURAL HAZARDS EXIST. THEY ARE NOT DEFINITIVE INDICATORS OF WHETHER OR NOT A PROPERTY WILL BE AFFECTED BY A NATURAL DISASTER.TRANFEREE(S) AND TRANFEROR(S) MAY WISH TO OBTAIN PROFESSIONAL ADVICE REGARDING THOSE HAZARDS AND OTHER HAZARDS THAT MAY AFFECT THE PROPERTY. The representations made in this NHD form and report are based upon information provided by an independent third party report provided as a substituted disclosure pursuant to California Civil Code §Section 1103.4. Neither the seller nor the seller's agent has (1) independently verified the information contained in this form and report or (2) is personally aware of any errors or inaccuracies in the information contained on the form. Tranferor represents that the information herein is true and correct to the best of the tranferor's knowledge as of the date signed by the transferor. Signature of Transferor Date Agent represents that the information herein is true and correct to the best of the agent's knowledge as of the. date signed by the agent. Signature of Agent Signature of Agent Date Date Transferee represents that he or she has read and understands this document. Signature of Transferee Date This form meets the standards of.civil code §1103. No representation is made as to the legal validity or adequacy of any provision in any specific transaction. A real estate broker is the person qualified to advise on real estate transactions. If you desire legal or tax advice, consult an appropriate professional. © 2006 LGS. Reports, Inc. 27200 Agoura Rd. Suite 200 Calabasas Hills, CA 91301 Tel 800.814-5599 Fax: 800-547-6566 v, ww.LGSReports.com CRo106 Page: 3 of 6 Date: May 9, 2006 LGS Report No:: 4183328 EXPLANATION SPECIAL FLOOD HAZARD AREAS The Federal Emergency Management Agency (FEMA) has prepared Flood Insurance Rate.Maps, which delineate flood zones based on estimated flood risk. The zones pertinent to the Natural Hazard Disclosure are Zones A and V (Special Flood Hazard Areas). Zone V is for coastal areas and Zone A is for inland areas. These zones are located within a 100-year flood plain. A 100-year flood has a one -percent chance of occurence in any given year. Flood insurance is required by federally regulated lending institutions for properties located within Zones A or V. Local flood control projects to mitigate flood hazard potential can change the flood risk of a specific area or property. The flood risk of a specific area or property may be updated through a Letter of Map Change filed with FEMA. Specific updated flood risk information, not included on:the Flood Insurance Rate Maps, is not provided in our report. If a property is located within a Special Flood Hazard Area, LGS REPORTS, INC. recommends contacting FEMA for the updated risk assessment of the property and the current Jlood insurance requirements. It should be noted that properties within a Special Flood Hazard Zone may never expenence-flooding, and conversely, properties not located within a.Special Flood Hazard Zone may experience flooding. This not meant to predict flooding, but rather to identify properties for which flood insurance may be required by federally regulated lending institutions. AREAS OF POTENTIAL FLOODING FROM DAM FAILURES The California Office of Emergency Services (CA 0ES)'has provided Inundation Maps, which delineate areas subject to flooding from a sudden, catastrophic failure of.a dam with a full reservoir. Maps; are not available for all dams in the state. Additional maps may become available subsequent to approval by the,OES. Inundation from reservoir, dam, or dike failure can pose serious risks to large segments of the population. Cities'and counties within the mapped areas are required to adopt emergency procedures for the evacuation of populated `areas: VERY HIGH FIRE HAZARD SEVERITY ZONES The California Department of Forestry and Fire Protection (CDF) under the Bates Bill (AB 337) established Very High Fire Hazard Severity Zones (VHFHSZ) in the Local Responsibility Areas (LRA) of California. The maps prepared by the CDF show zones based on State criteria. Local agencies, by law, are allowed to make changes to the zones. Fire defense improvements are mandated for properties located within the zones under Section 51182 of the Government Code. Mandated improvements include a Class A roof for new development or replacement of an existing roof and brush clearing within 30 feet of a structure. For a complete listing of the mandated fire defense improvements and local zone changes, contact the local fire department. The Very High Fire Hazard Severity Zone Maps were prepared at a scale that does not always allow a conclusive determination to be made at zone boundaries. If a conclusive determination cannot be made, the property will be reported on the Natural Hazard Disclosure Statement as situated in the zone as mandated by Section §1102.6C of the California Civil Code. LGS Reports, Inc. will report the property as in a boundary condition on our Residential Disclosure Report. Therefore, the local fire department should be contacted to determine if the property is located within the zone. 0 2006 LGS Reports, inc. 27200 Agoura Rd. Suite 200 Calabasas Hills, CA 91301 Tel 800-814-5599 Fax: 800-547-6566 www.LGSReports.com CRo106 Page: 4 of 6 Date: May 9, 2006 LGS Report No.: 4183328 WILDLAND AREAS THAT MAY CONTAIN SUBSTANTIAL FOREST FIRE RISK AND HAZARDS (State Responsibility Areas) The California Department of Forestry and Fire Protection has established State Responsibility Areas (SRA) for which the primary financial responsibility for prevention and suppression of fires is that of the State. However, the State is not responsible for protecting structures within these areas. The property owner is subject to certain maintenance requirements and maybe responsible for fire protection of structures under Section 4291 of the Public Resources Code. If the property is located within a State Responsibility Area, LGS Reports, Inc. recommends contacting the county fire department to obtain a full listing of property owner maintenance and fire protection requirements. Public Resources Code Section 4326 reads, "A seller of real property which is located within a state responsibility area determined by the board, pursuant to Section 4125, shall disclose to any prospective purchase the fact thatthe property is located within a wildland area which may conatin substantial forest fire risks and hazards and is subject to the requirements of Section 4291." The State Responsibility Area Maps were prepared at a scale.that:does not always allow:a conclusive determination to be made at zone boundaries. If a conclusive determination cannot`be made, -the property will be reported on the Natural Hazard Disclosure Statement as situated in the zone as mandated by Section.1102.6C of the California Civil Code. LGS Reports, Inc. will report the property as in:a boundary condition on our Residential Disclosure Report: The county fire department should be contacted to determine if the property is located within'the zone. ALQUIST-PRIOLO EARTHQUAKE '.FAULT ZONES The State Geologist under the Alquist-Priolo.Earthquake :Fault Zoning Act has established regulatory zones around the mapped surface traces of active faults. These zones, typically -one -quarter mile or less in width, have been delineated on maps around "sufficiently active and well-defined_" faults and fault segments that "constitute a potential hazard to structures from surface faulting or fault creep." Faults that demonstrate movement during the past 11,000 years are considered active. The purpose of the Act under Section 2621-2630 of the Public Resources Code is to assist cities and counties in land use planning and developing permit requirements. The State Mining and Geology Board provides additional regulations to guide cities and counties in their implementation of the law under California Code of Regulations, Title 14, Division 2. Local agencies must regulate most types of development projects located within the zones. The results of our search only indicate whether a property is situated or not situated within an Earthquake Fault Zone, as shown on the Alquist-Priolo Earthquake Fault Zone Maps. Our search does not indicate whether or not a surface trace of an active fault is located on the property. If this report indicates the subject property is located within an Earthquake Fault Zone, LGS Reports, Inc. recommends consulting a Certified Engineering Geologist to assess the site -specific potential for surface fault rupture. It should be noted that the State Earthquake Fault Zoning Program is ongoing and properties currently not situated in a zone may be located in a zone established in the future. © 2006 LGS Reports,. Inc. 27200 Agoura Rd. Suite 200 Calabasas Hills, CA 91301 Tel 800-814-5599 Fax: 800-547-6566 www.LGSReports.com CRO106 Page: 5 of 6 Date: May 9, 2006 LGS Report No.: 4183328 SEISMIC HAZARD ZONES The California Division of Mines and Geology under the Seismic Hazards Mapping Act has prepared maps delineating zones of potential seismic hazards. The legislation for this Act may be found in the California Public Resources Code, Division 2, Chapter 7.8, Sections 2690-2699.6 and Chapter 8, Article 10, Sections 3720-3725. The purpose of the Act is to provide cities and counties with zones where site -specific geotechnical studies are required prior to development. Local agencies must regulate most types of development projects located within the zones. The currently available Official Maps of Seismic Hazard Zones contain zones for the seismic hazards of liquefaction and earthquake -induced landsliding for limited geographic areas only. However,, future maps may contain additional seismic hazards and may cover the entire state. Our search indicates whether a property is situated or not situated within a mapped Seismic Hazard Zone. If the property is not located in an area mapped by the state Seismic Hazards Mapping Program, our report indicates that the map for the site has not yet been released by the State. Due to the limitations of the state Seismic Hazards Mapping Program, LGS Reports, Inc. recommends hiring a Certified Engineering Geologist to address any concerns regarding the seismic hazard potential of the subject site. The Liquefaction Hazard Zones delineate areas where liquefaction has been recorded in the past and areas where local soil and groundwater conditions indicate a potential for permanent ground displacement from liquefaction that would require mitigation. Site specific geotechnical studies are required prior to new. development. Liquefaction is a process whereby saturated, unconsolidated, sandy soils, temporarily become liquefied as a`result of strong.ground shaking. Liquefaction is considered most likely when the ground water table is located less than 50 feet -below the ground surface. Ground displacement may occur and buildings may be damaged as a result of liquefaction. Earthquake -Induced Landslide Zones include areas where geologic materials are considered susceptible to slope failure during strong earthquake ground shaking. Also included are areas with identified past landslide movement and areas with known earthquake -induced slope failure during historic earthquakes. Site specific geotechnical studies are required prior to new development. It should be noted that the maps may not show all areas of potential liquefaction or earthquake -induced landsliding. In addition, the mapped areas within each zone;will not be affected uniformly, during an earthquake. As noted on the maps, "Liquefaction zones may also contain areas susceptible`to the effects of earthquake -induced landslides. This situation typically exists at or near the toe of existing landslides, .downslope;from rockfall or debris flow source areas, or adjacent to steep stream beds.". © 2006 LGS Reports, Inc. 27200 Agoura Rd. Suite 200 Calabasas Hills, CA 91301 Tel 800-814-5599 Fax: 800-547-6566 www.LGSReports.com CR0106 Fax 800-547-6566 TERMS, CONDITIONS AND LIMITATIONS OF LIABILITY This Natural Hazard Disclosure Report ("Report") was prepared by LGS Reports, Inc. ("LGS"). This Report is valid solely for and may be used only in connection with the transaction presently contemplated between this buyer and this seller relating to the property address.and assessor's parcel number ("APN") furnished to LGS as shown on page 1 of this Report (the "Property"). Seller or seller's agent is responsible for verifying the accuracy of the property address and APN within five (5) days of receipt of this Report. Upon notification of an inaccurate address or APN within said 5-day period, LGS will issue a replacement report. The disclosures contained in this Report are valid only as of the date shown on page 1 of this Report. This Report is for the exclusive use and reliance of the buyer, seller, listing agent/broker and selling agent/broker, if any, involved in the current transaction and maybe used only in conjunction with a Natural Hazard Disclosure Statement issued in this transaction for this Property. This Report is not intended to be and may not be used for any other purposes, including but not limited to appraisal or valuation of the Property. Any other reproduction, facsimile, or republication of this report is expressly prohibited and is_a violation of the copyrights, trademarks and service marks of LGS Reports, Inc., and will be prosecuted to the fullest:extent of the law. This Report may not be used by or relied upon by any other parties, including but .notlimited to lenders or subsequent buyers of the Property. There shall be no third party beneficiaries to this Report regardless of.their relationship with or to the buyer, the seller, the listing agent/broker, selling agent/broker or the Property. LGS makes no representations, promises or covenants as to the Report's effect on the value of the Property as a result of the -various disclosures contained in this Report. If multiple adjacent parcels are being transferred as a single property -or in a single transaction this Report treats them as if they were a single parcel. That is, hazards and locations` -that affect an individual parcel.will be disclosed as affecting all parcels. Should the seller or buyer desire hazard disclosures with regard to each parcel separately, a .separate report must be ordered for each such parcel. The information disclosed in this Report is time -sensitive and may be,considered accurate only as of the date shown on page 1 of this Report. Governmental actions occurring after the date shown on page.1 -of this Report are not disclosed. LGS shall have no duty or obligation to inform the buyer, the seller or their agents/brokers-of-any changes orgovernmental actions pertaining to or affecting the Property which become: effective after the date shown on page 1 of this Report. It is recommended that a request for an updated Report be made ifthe Propertyremains unsold. -for an extended period of time after this Report is issued. LGS has relied solely upon records, statutes' and information specifically referred to in this Report for preparation of this Report. The records and information were supplied by various governmental or public agencies. LGS has assumed that the records and information supplied by various governmental and public agencies are complete and accurate. LGS has not independently verified the information provided by the various governmental agencies. Consequently, LGS shall not be responsible for any inaccuracies or omissions in public records or in information reported by various governmental or public agencies. No physical inspection of the Property has been made for purposes of preparing this Report. LGS shall not be responsible for any disclosures other than those expressly set forth in this Report. This Report is not a substitute for a title report or title insurance and may not be relied upon as such. LGS shall have no responsibility or liability for any costs, losses or consequential damages arising from earthquakes or floods or from the need or lack of need for earthquake insurance or flood hazard insurance. The Federal Emergency Management Agency (FEMA), the National Flood Insurance Program or an insurance agent should be contacted for information regarding flood insurance. An insurance agent should be contacted for earthquake insurance information. As more particularly disclosed herein, this Report addresses certain earthquake zones, flood zones and fire zones only. It does not address matters related to (a) title or title defects, (b) survey or geologic issues, (c) land use or zoning, (d) the California Subdivided Lands Act or the Subdivision Map Act, (e) compliance with other federal, state or local laws, ordinances or restrictions that may apply to the property, such as the Americans with Disabilities Act and building codes, (f) restrictions affecting the use, occupancy or development of the property imposed by any state, local or federal governmental agency, including without limitation, flood control districts, the California Coastal Commission, joint power districts, water districts, agencies or school districts, (g) any permits of any nature that may be required for the current or anticipated future use of the property, or (h) any other legal concerns that might affect the property. ACCEPTANCE OR USE OF THIS REPORT, OR EXECUTION BY THE BUYER, SELLER, OR THEIR RESPECTIVE AGENTS OF A NATURAL HAZARD DISCLOSURE STATEMENT IN CONJUNCTION WITH THIS REPORT, CONSTITUTES APPROVAL AND ACCEPTANCE OF THE TERMS, CONDITIONS, AND LIMITATIONS STATED HEREIN. LGS SHALL NOT BE LIABLE FOR LOST PROFITS, DIMINUTION IN PROPERTY VALUE OR ANY INDIRECT, INCIDENTAL OR CONSEQUENTIAL DAMAGES IN CONNECTION WITH, OR ARISING OUT OF, THE PREPARATION, ISSUANCE, OR USE OF THIS REPORT. © 2006 LGS Reports, Inc. 27200 Agoura Rd. Suite 200 Calabasas Hills, CA 91301 Tel 800-814-5599 Fax: 800-547-6566 www.LGSReports.com GRO106 01" ign and Return SELLER'S AFFIDAVIT OF NONFOREIGN STATUS FOR ENTITIES Section 1445 of the Internal Revenue Code provides that a transferee of U.S. real property interest must withhold tax if the transferor is a foreign person. For U.S. tax purposes (including section 1445), the owner of a disregarded entity (which has legal title to a U.S. real property interest under local law) will be the transferor of the property and not the disregarded entity. To inform the transferee that withholding of tax is not required upon the disposition of a U.S. real property interest located at 2301 EAST VERNON AVENUE VERNON, CA 90058 by Seller, the undersigned hereby certifies the following on behalf of Seller: • Seller is not a Foreign Corporation, Foreign Partnership, Foreign Trust, or Foreign Estate as those terms are defined in the Internal Revenue Code and Income Tax Regulations; Q Seller is not a disregarded entity as defined in Section 1.1445-2(b) (2) (iii); 0 Seller's U.S. Employer's Identification Number is Q Seller's 's office address is: 4305 S..-Santa Fe Avenue Vernon CA 90058 Seller understands that this Certification may be disclosed to the Internal Revenue Service by transferee and that any false statement contained herein could be punished by fine, imprisonment or both. Under penalties of perjury, I/we declare that I/we have examined this Certification and to the best of my/our knowledge and belief it is true, correct and complete (and, for entity transferor, I/we further declare that I/we have authority to sign this document on behalf of CITY OF VERNON, A BODY CORPORATE AND POLITIC . Dated: May 9, 2006 Seller/Transferor: City of Verryop, a body corporate and politic By: l Br �e Malkenhorst, Jr. Its: Actin ity Clerk Appr ed as orm: Y' B . Jeff riso , Itxk�alil Chi Assistant City Attorney NORTH AMERICAN TITLE COMPANY 520 North Brand Boulevard, Glendale, CA, 91203 PHONE: (818)240-4912 FAX: (818)551-5361 TripleTek Enterprise Settlement System 4875 YEAR Real Estate Withholding Certificate CALIFORNIA FORM 2006 593-C Rptnrn this fnrm to vour escrow company. Part I Seller's information - Name (including spouse, if applicable -see instructions - type or print) City of Vernon - - SSN, FEIN, or CA Corporation no. Address 4305 S. Santa Fe Avenue Private Mailbox no. Spouse's SSN (if applicable) City State . ZIP Code Vernon CA 90058 Note: If you do not furnish your tax ID number this certificate is void. Property address (if no street address, provide parcel number and county) 2301 EAST VERNON AVENUE VERNON, CA 90058 Ownership percentage 100.00 % Read the following and check the appropriate box. (See line -by-line instructions.) Part ll Certifications which fully exempt the sale from withholding: YES NO 1. Does the property qualify as the seller's (or decedent's, If being sold by the decedent's estate) principal residence within the meaning of Internal Revenue Code (IRC) Section121?................................................................................... 2. Did the seller (or decedent, if being sold by the decedent's estate) last use the property as the seller's (decedent's) principal residence within the meaning of IRC Section 121 without regard to the two-year time period? ........... . ......................... ............ . ly 3. Will the seller have a loss or zero pain for California income tax purposes on this sale? (To check "YES", you must complete Form 593-L❑, Read Estate Withholding - Computation of Estimated Gain or Loss, and have a loss or zero gain on line 16.).......................... . 4. Is the property being compulsorily or involuntarily converted and does the seller intend to acquire property that is similar or related in service or use to qualify for nonrecognition of gain for California income tax purposes under IRC Section 1033?................. ❑ 5. Will the transfer qualify for nonrecognition treatment under IRC Section 351 (transfer to a corporation controlled by the transferor) or IRC Section 721 (contribution to a partnership in exchange for a partnership interest)? ............................ ❑ E 6. Is the seller a corporation (or an LLC classified as a corporation for federal and California income tax purposes) that is either qualified through the California Secretary of State or has a permanent place of Business in California? ........................................... . ff 7. Is the seller a partnership (or an LLC that is not a disregarded single member LLC and is classified as a partnership for federal and California in- come tax purposes) with recorded title to the property in the name of the partnership or LLC? (If yes, the partnership or LLC must withhold on nonresident partners or members as required.) . . ........ . .......... . .............. ❑ IN 8. Is the seller a tax-exempt entity under either California or federal law? .................................................... 6 ❑ 9. Is the seller an insurance company, individual retirement account, qualified pension/profit sharing plan, or charitable remainder trust? . ❑ E$ Part /// - Certifications that may partially or fully exempt the sale from withholding: 10. Will the transfer qualify as a simultaneous like -kind exchange within the meaning of IRC Section 1031?..........................❑ l Escrow Officer- If the seller checked "YES", withholding is still required on any proceeds disbursed to the seller from escrow. 11. Will the transfer qualify as a deferred like -kind exchange within the meaning of IRC Section 1031?............................. ❑ . 12. Will the transfer of this property be an installment sale that you will report as such for California tax purposes and has the buyer agreed to withhold on each principal payment instead of withholding the full amount at the time of transfer? ................. ❑ lR Part IV — Seller's Signature Under penalties of perjury, I hereby certify that the information provided above is, to the be�s iof my knowledge, true and correct. If condi- tions change, I will promptly inform the withholding agent. I understand that completing t i5 form does not exempt me from filing a Califor- nia income tax return to report this sale. Seller's Name and Title: Bruce V. Malkenhorst, Seller's signature: Dated/19/06 r., Acting City Clerk Date: Spouse's Name: Spouse's signature: Seller: If you checked "YES" to any of the questions in Part II, you are exempt from real estate withholding. If you checked "YES" to any of the questions in Part III, you may qualify for a partial or complete withholding exemption. If you checked "NO" to all of the questions in Part II and Part III, the withholding will be 3 1/3 percent of the total sales price. If you are withheld upon, the withholding agent should give you two copies of Form 593-B, Real Estate Withholding Tax Statement. Attach one copy to the lower front of your California income tax return and keep the other copy for your records. For Privacy Act Notice, get form FTB 1131. (Individuals only) 593C05103 Form 593-C C2 (2005) 520 North Brand Boulevard Glendale, CA, 91203 PHONE: (818)240-4912 * FAx: (818)551-53.61 AMENDED AND/OR SUPPLEMENTED ESCROW INSTRUCTIONS .July 28, 2006 Escrow No: 227049-TD RE: 2301 EAST VERNON AVENUE, VERNON; CA 90058 TO: North American Title Company My previous instructions in the above numbered escrow are hereby amended and/or supplemented in the following particulars only: 1. Buyer does authorize and instruct Escrow Holder to vest title In the subject property as follows: ALPINE UNIVERSAL, INC., A CALIFORNIA CORPORATION 2. Buyer states, Buyer has executed and deposited with the Escrow Holder a new 1st Deed of Trust to file securing a note for a new conventional loan in the amount of $6,262,500.00, as per terms of UNION BANK OF CALIFORNIA lender's instructions also handed into escrow. 3. Paragraph 9 and 9.1 of the original Escrow Instructions dated May 4, 2006 (revised May 5, 2006) is intentionally deleted. There are no prorations of any kind to be completed in connection with this escrow. The Buyer understands that once the Assessor's office receives the recorded grant deed, they will establish values and a new parcel number as of the recordation date, and a tax bill will be created, but probably not until after January 1, 2007. Seller states, seller is not responsible to credit Buyer with any taxes from July 1 to the closing as Seller has no tax liability due to it's tax exempt status. 4. The expected closing date as mutually agreed to by and between the undersigned, is established as being August 4, 2006. 5. Upon recordation of the grant deed that conveys title of the subject property to Buyer, it shall conclusively be presumed by the Escrow Holder that all conditions of this escrow as referenced in the Agreement or as between the Buyer and Seller, have been satisfactorily completed, as well as any documents delivered to Buyer in connection with the escrow, directly to Buyer, without Escrow Holder delivery through escrow, have been received by Buyer, or the receipt of same, has been waived by Buyer, prior to the close of escrow. *****ALL OTHER TERMS AND CONDITIONS SHALL REMAIN THE SAME.***** EACH OF THE UNDERSIGNED STATES THAT HE/SHE HAS READ THE FOREGOING INSTRUCTIONS AND UNDERSTANDS THEM AND DOES HEREBY ACKNOWLEDGE RECEIPT OF A COPY OF THESE INSTRUCTIONS, EACH OF THE UNDERSIGNED UNDERSTANDS THESE INSTRUCTIONS MAY BE EXECUTED IN COUNTERPARTS, ALL OF WHICH WHEN TAKEN TOGETHER SHALL. BE DEEMED TO BE THE INSTRUMENT. SELLERS: BUYERS: City of Verno Labody corporate and politic By: Bruce. Malkenhorst, Jr. Its: Acting City Clerk Alpine Universal, Inc., a California corporation By: James H. Schladen, President AMENDED AND/OR SUPPLEMENTED ESCROW INSTRUCTIONS July 28, 2006 Escrow No: 227049-TD RE: 2301 EAST VERNON AVENUE, VERNON, CA 90058 TO: North American Title Company My previous instructions in the above numbered escrow are hereby amended and/or supplemented in the following particulars only: 1. Buyer does: authorize and instruct Escrow Holder to vest title in the subject property as follows: ALPINE UNIVERSAL, INC., A CALIFORNIA CORPORATION 2. Buyer states, Buyer has executed and deposited with the Escrow Holder a new 1st Deed of Trust to file securing a note for a new conventional loan in the amount of $6,262,500.00, as per terms of UNION BANK OF CALIFORNIA lender's instructions also handed into escrow. 3. Paragraph 9 and 9.1 of the original Escrow Instructions dated May 4, 2006 (revised May 5, 2006) is intentionally deleted. There are no prorations of any kind to be completed in connection with this escrow. The Buyer understands that once the Assessor's office receives the recorded grant deed, they will establish values and a new parcel number as of the recordation date, and a tax bill will be created, but probably not until after January 1, 2007. Seller states, seller is not responsible to credit Buyer with any taxes from July 1 to the closing as Seller has no tax liability due to it's tax exempt status. 4. The expected closing date as mutually agreed to by and between the undersigned, is established as being August 4, 2006. 5. Upon recordation of the grant deed that conveys title of the subject property to Buyer, it shall conclusively be presumed by the Escrow Holder that all conditions of this escrow as referenced in the Agreement or as between the Buyer and Seller, have been satisfactorily completed, as well as any documents delivered to Buyer in connection with the escrow, directly to Buyer, without Escrow Holder delivery through escrow, have been received by Buyer, or the receipt of same; has been waived by Buyer, prior to the close of escrow. *****ALL OTHER TERMS AND CONDITIONS SHALL REMAIN THE SAME.***** EACH OF THE UNDERSIGNED STATES THAT HE/SHE HAS READ THE FOREGOING INSTRUCTIONS AND UNDERSTANDS THEM AND DOES HEREBY ACKNOWLEDGE RECEIPT OF A COPY OF THESE INSTRUCTIONS. EACH OF THE UNDERSIGNED UNDERSTANDS THESE INSTRUCTIONS MAY BE EXECUTED IN COUNTERPARTS, ALL OF WHICH WHEN TAKEN TOGETHER SHALL BE DEEMED TO BE THE INSTRUMENT. SELLERS: City of Vernon, a body corporate and politic By: Bruce V. Malkenhorst, Jr. Its: Acting City Clerk TripleTek Enterprise Setdement System 4583 Amendmt.doc AV Amendment to that certain Standard Offer, Agreement and Escrow Instructions for Purchase of Real Estate dated March 6, 2006, together with the Addendum attached thereto (hereinafter collectively "Agreement") RE: 2301 EAST VERNON AVENUE, VERNON, CA 90058 Date: May 4, 2006 1. Whereas, the parties hereto, have entered into the Agreement referenced above, and now agree to amend said Agreement as follows: a. The 30 day period and/or the 30th calendar day reference in Paragraph 7.1, Page 2 of the Agreement is hereby corrected to read: "....:......the 60t' calendar day after the Date of Agreement (which 60 day period shall be extended to the next business day if it ends on a Friday, weekend, or holiday) (the "Due Diligence Period"." *****ALL OTHER TERMS AND CONDITIONS SHALL REMAIN THE SAME.***** EACH OF THE UNDERSIGNED STATES THAT HE/SHE HAS READ THE FOREGOING INSTRUCTIONS AND UNDERSTANDS THEM AND DOES HEREBY ACKNOWLEDGE RECEIPT OF A COPY OF THESE INSTRUCTIONS. EACH OF THE UNDERSIGNED UNDERSTANDS THESE INSTRUCTIONS MAY BE EXECUTED IN COUNTERPARTS, ALL OF WHICH WHEN TAKEN TOGETHER SHALL BE DEEMED TO BE THE INSTRUMENT. SELLER: BUYER: City of Vernon, a body corporate and politic Alpine ve"l j i0'#CXfornia corporation By: BY: Bruce V. Malkenhorst, Jr. J r e' Schladen, President Its: Acting City Clerk Approved as to form: By: Jeff Harrison, for Karns & Karabian, General Counsel TripleTek Enterprise Settlement System 4583 Amendmt.doc Amendment to that certain Standard Offer, Agreement and Escrow Instructions for Purchase of Real Estate dated March 6, 2006, together with the Addendum attached thereto (hereinafter collectively "Agreement") RE: 2301 EAST VERNON AVENUE, VERNON, CA 90058 Date: May 4, 2006 i. Whereas, the parties hereto, have entered into the Agreement referenced above, and now agree to amend said Agreement as follows: a. The 30 day period and/or the 30th calendar day reference in Paragraph 7.1, Page 2 of the Agreement is hereby corrected to read: "...........the 60th calendar day after the Date of Agreement (which 60 day period shall be extended to the next business day if it ends on a Friday, weekend, or holiday) (the "Due Diligence Period"." *****ALL OTHER TERMS AND CONDITIONS SHALL REMAIN THE SAME.***** EACH OF THE UNDERSIGNED STATES THAT HE/SHE HAS READ THE FOREGOING INSTRUCTIONS AND UNDERSTANDS THEM AND DOES HEREBY ACKNOWLEDGE RECEIPT OF A COPY OF THESE INSTRUCTIONS. EACH OF THE UNDERSIGNED UNDERSTANDS THESE INSTRUCTIONS MAY BE EXECUTED IN COUNTERPARTS, ALL OF WHICH WHEN TAKEN TOGETHER SHALL BE DEEMED TO BE THE INSTRUMENT. SELLER:' City of Veen, a .body corporate and politic Brice . Malkenhorst, Jr. Its: Acting City Clerk Approy.i�,d as'1'01orm: By: le rri n, Chief Assistant City.Attorney BUYER: Alpine Universal, Inc., a California corporation By: James H. Schladen, President TripleTel< Enterprise Settlement System 4583 Amendmt.doc � e Z UNAR COMPANY rk- ESCRow NO: 227049-TD DATE: May 4, 2006(Revised May 5, 20061 ESCROW OFFICER: TINA DE BOW PROPERTY ADDRESS: 2301 EAST VERNON AVENUE, VERNON, CA 900!58 The attached copy of the Standard Offer, Agreement and Escrow Instructions for Purchase of Real Estate dated March 6, 2006, together with the Addendum attached thereto (hereinafter collectively referred to . as "Agreement"), shall constitute your escrow instructions. The following instructions are given you to utilize said `Agreement" as your escrow instructions, which are as follows: 1. The date to be considered as the "Date of Mutual Execution" of the Agreement and the term "Date of Agreement" as referenced in the Agreement is hereby established as being May 1, 2006. 2. The "Expected Closing Date" as referenced in the Agreement, is hereby established as being a date mutually agreed to by the Parties, that is on or before 30 days after expiration of the Contingency Period (expected "Closing Date"). 3. Buyer shall advise escrow in writing at least 10 days prior to the expected closing date as referenced elsewhere herein, with Buyer's exact manner in which Buyer shall vest title in the subject property. 4. The Buyer's Contingencies as referenced in Paragraph 7.1 of the Agreement, shall be satisfied by Buyer on or before June 30, 2006 (said date being the 60th calendar day after the Date of Agreement). 5. The legal description for the subject property is attached hereto, marked Exhibit "A" and by this reference incorporated herein and made a part hereof. 6. The Buyer and Seller acknowledge that depending on the type (commercial and/or industrial) and location (city) of the subject real property in this escrow, there may be disclosures, as well as civil ordinance requirement(s) that would affect the transfer of the real property. Escrow Holder urges both the Buyer and the Seller to seek appropriate counsel to ascertain what disclosures/civil ordinances requirements and will comply with the same outside of escrow. Unless otherwise instructed in writing by the parties regarding these matters, Escrow Holder shall have no responsibilities or liabilities in connection herewith. 7. The General Provisions of Escrow Holder as referenced elsewhere herein, are made part hereof, and have been read and are hereby approved by the undersigned (in the event of a conflict between the Agreement and these instructions, including the General Provisions, the Agreement shall control). In the event cancellation of this escrow occurs, the provisions of sections 6.6, 6.8, and 6.10 of the Agreement shall become operable, notwithstanding the provisions set forth in section 14 of the referenced General Provisions. 8. By signing these escrow instructions, Buyer and Seller hereby ratify and confirm the attached Agreement, subject to clarifications contained in these instructions, for use herein whether or not their name, signature or initials appear thereon (including the initialed change made by Buyer on Page 5 of the Agreement). 9. Regarding Paragraphs 9.1 through 9.3 of the Agreement: At the close of escrow, you are hereby authorized and instructed to prorate and/or adjust the following: 1. Real property taxes on said property, as of date of close of escrow, for the current tax year at the time of close of escrow (2006-2007 predicated upon a closing date occurring after July 1, 2006), based on an amount to be mutually agreed upon as between the parties, and provided Escrow Holder in writing for use in the preparation of Estimated Closing Statements fn ho cinnarl by thn nnrtiac nrinr i-n rinca of ocrrrnnl NORTH -AAWRICAN COMMERCIAL INSTRUCTIONS ESCROW No: 227049-TD DATE: May 4, 2006(Revised May 5, 2006l ESCROW OFFICER: TINA DE BOW PROPERTY ADDRESS: 2301 EAST VERNON AVENUE, VERNON, CA 90058 The attached copy of the Standard Offer, Agreement and Escrow Instructions for Purchase of Real Estate dated March 6, 2006, together with the Addendum attached thereto (hereinafter collectively referred to as "Agreement"), shall constitute your escrow instructions. The following instructions are given you to, utilize said "Agreement" as your escrow instructions, which are as follows: 1. The date to be considered as the "Date of Mutual Execution" of the Agreement and the term "Date of Agreement" as referenced in the Agreement is hereby established as being May 1, 2006. 2. The "Expected Closing Date" as referenced in the Agreement, is hereby established as being a date mutually agreed to by the Parties, that is on or before 30 days after expiration of the Contingency Period (expected "Closing Date"). 3. Buyer shall advise escrow in writing at least 10 days prior to the expected closing date as referenced elsewhere herein, with Buyer's exact manner in which Buyer shall vest title in the subject property. 4. The Buyer's Contingencies as referenced in Paragraph 7.1 of the Agreement, shall be satisfied by Buyer on or before June 30, 2606 (said date being the 60th calendar day after the Date of Agreement). 5. The legal description for the subject property is attached hereto, marked Exhibit "A" and by this reference incorporated herein and made a part hereof. 6. The Buyer and Seller acknowledge that depending on the type (commercial and/or industrial) and location (city) of the subject real property in this escrow, there may be disclosures, as well as civil ordinance requirement(s) that would affect the transfer of the real property. Escrow Holder urges both the Buyer and the Seller to seek appropriate counsel to ascertain what disclosures/civil ordinances requirements and will comply with the same outside of escrow. Unless otherwise instructed in writing by the parties regarding these matters, Escrow Holder shall have no responsibilities or liabilities in connection herewith. 7. The General Provisions of Escrow Holder as referenced elsewhere herein, are made part hereof, and have been read and are hereby approved by the undersigned (in the event of a conflict between the Agreement and these instructions, including the General Provisions, the Agreement shall control). In the event cancellation of this escrow occurs, the provisions of sections 6.6, 6.8, and 6.10 of the Agreement shall become operable, notwithstanding the provisions set forth in section 14 of the referenced General Provisions: 8. By signing these escrow instructions, Buyer and Seller hereby ratify and confirm the attached Agreement, subject to clarifications contained in these instructions, for use herein whether or not their name, signature or initials appear thereon (including the initialed change made by Buyer on Page 5 of the Agreement). 9. Regarding Paragraphs 9.1 through 9.3 of the Agreement: At the close of escrow, you are hereby authorized and instructed to prorate and/or adjust the following: 1. Real property taxes on said property, as of date of close of escrow, for the current tax year at the time of close of escrow (2006-2007 predicated upon a closing date occurring after July 1, 2006), based on an amount to be mutually agreed upon as between the parties, and provided Escrow Holder in writing for use in the preparation of Estimated Closing Statements ESCROW NO.: 227049-TD Date: May 4, 2006 PAGE 2. Additional instructions made a part of previous pages as if'fully incorporated therein. 2. Escrow Holder shall not be required to determine default of any party and reserves the right to require mutual disbursement instructions in the event such disbursement is to be made pursuant to termination of escrow or liquidated damage provision contained in said Agreement; 3. Escrow Holder reserves the right to require the parties to deliver written approval, satisfaction or waiver of all conditions precedent to (a) any release of funds and/or (b) close of escrow; 4. Any provision for release (payment) of funds prior to the close of this escrow is made with knowledge of the condition(s) of escrow and title to the property that is the subject of this escrow. The Escrow Holder shall have no responsibility or liability except compliance with any such release (payment) instruction and any payment so made is without recourse upon North American Title; 5. All parties understand that North American Title Company may not be able to provide underwriting approval with regard to issuance of policy(ies) of title insurance requested herein without a reasonable period of time to review all requirements and documentation supporting same. The review will require a minimum of three working days. Copies of draft documentation will be accepted to commence underwriting approval process; 6. Buyer shall furnish Escrow Holder with a completed Preliminary Change of Ownership report required by the County Assessor, to be attached to the Grant Deed recording herein. If Escrow Holder is not in receipt of said form prior to the close of escrow, or if said form is not completed or acceptable to the County Recorder, Buyer agrees to pay an additional recording fee of $20.00 through and at the end of closing of this escrow; 7. Chapter 598, Statutes of 1989, effective January 1, 1990 mandates certain hold periods for any type of check (including Casher's Checks) being deposited in this escrow prior to disbursement being able to take place. Delays in closing and/or delays in release of funds prior to closing will occur if funds by other than a bank wire. Our wire instructions are as follows: Comerica Bank 333 W. Santa Clara Street, San Jose, CA 95113 ESCROW NO. 227049-TD ABA/Routing No. 121137522 CREDIT: North American Title Account No: 1892091172 8. In the event Buyer and Seller utilize "facsimile" transmitted, signed documents (by Panfax, Telefax, etc.), Buyer and Seller hereby agree to accept, and instruct the Escrow Holder to rely upon such documents as if they bore original signatures. Buyer and Seller hereby acknowledge and agree to provide to Escrow Holder, within 72 hours of transmission, such documents bearing the original signatures. NOTWITHSTANDING ANYTHING CONTAINED IN THIS PARAGRAPH TO THE CONTRARY, ESCROW HOLDER SHALL HAVE NO LIABILITY AND/OR RESPONSIBILITY TO OBTAIN SAID ORIGINAL EXECUTED DOCUMENT OF THE FAXED MATERIAL SHOULD SAME NOT HAVE BEEN RECEIVED BY ESCROW HOLDER. Buyer and Seller further acknowledge and agree that documents necessary for recording with non -original (facsimile) signatures will not be accepted for recording by the County Recorder, thus delaying the close of escrow. 9. Parties to this transaction are aware and understand that as a result of the passage of the Tax Reform Act of 1986, which added section 6045(e) to the Internal Revenue Code, the closing of this transaction will be delayed in the event Seller(s) to this escrow should refuse to remit to Escrow Agent/Holder, prior to the close of escrow, "Seller's Certification of Compliance with Real Estate Reporting Requirements," with all necessary information fully completed and duly executed. 10. Parties to this transaction understand that in accordance with Section 18662 and 18668 of the Revenue and Taxation code, Escrow Holder will be providing the parties with the required NOTICE OF TAX WITHHOLDING REQUIREMENTS, and the closing of this transaction will be delayed in the event any party to this escrow should refuse to remit to Escrow Holder, prior to closing, the written acknowledgement of receipt of said Notice. 11. Escrow Holder shall not be concerned with, or liable for payment, adjustment or proration of, supplemental taxes assessed pursuant to Chapter 498, Statutes of 1983, State of California, unless specifically reflected on the Tax Assessor's rolls. All assessments not shown on the tax rolls are to be adjusted outside of escrow. The title policy will contain an exception for the lien of any assessments of Supplemental taxes pursuant to Chapter 498, Statutes of 1983. 12. In the event Escrow Holder is to deposit any funds into an interest -bearing account at Comerica Bank, NA, at he rate offered at time of investment(s), depositing party will place into escrow a ESCROW NO.: 227049-TD Date: May 4, 2006 PAGE 2. Additional instructions made a part of previous pages as if fully incorporated therein 2. Escrow Holder shall not be required to determine default of any party and reserves the right to require mutual disbursement instructions in the event such disbursement is to be made pursuant to termination of escrow or liquidated damage provision contained in said Agreement; 3. Escrow Holder reserves the right to require the parties to deliver written approval, satisfaction or waiver of all conditions precedent to (a) any release of funds and/or (b) close of escrow; 4. Any provision for release (payment) of funds prior to the close of this escrow is made with knowledge of the condition(s) of escrow and title to the property that is the subject of this escrow. The Escrow Holder shall have no responsibility or liability except compliance with any such release (payment) instruction and any payment so made is without recourse upon North American Title; 5. All parties understand that North American Title Company may not be able to provide underwriting approval with regard to issuance of policy(ies) of title insurance requested herein without a reasonable period. of time to review all requirements and documentation supporting same. The review will require a minimum of three working days. Copies of draft documentation will be accepted to commence underwriting approval process; 6. Buyer shall furnish Escrow Holder with a completed Preliminary Change of Ownership report required by the County Assessor, to be attached to the Grant Deed recording herein. If Escrow Holder is not in receipt of said form prior to the close of escrow, or if said form is not completed or acceptable to the County Recorder, Buyer agrees to pay an additional recording fee of $20.00 through and at the end of closing of this escrow; 7. Chapter 598, Statutes of 1989, effective January 1, 1990 mandates certain hold periods for any type of check (including Casher's Checks) being deposited in this escrow prior to disbursement being able to take place. belays in closing and/or delays in release of funds prior to closing will occur if funds by other than a bank wire. Our wire instructions are as follows: Comerica Bank 333 W. Santa Clara Street, San lose, CA 95113 ESCROW NO. 227049-TD ABA/Routing No. 121137522 CREDIT: North American Title Account No: 1892091172 8. In the event Buyer and Seller utilize "facsimile" transmitted, signed documents (by Panfax, Telefax, etc.), Buyer and Seller hereby agree to accept, and instruct the Escrow Holder to rely upon such documents as if they bore original signatures. Buyer and Seller hereby acknowledge and agree to provide to Escrow Holder, within 72 hours of transmission, such documents bearing the original signatures. NOTWITHSTANDING ANYTHING CONTAINED IN THIS PARAGRAPH TO THE CONTRARY, ESCROW HOLDER SHALL HAVE NO LIABILITY AND/OR RESPONSIBILITY TO OBTAIN SAID ORIGINAL EXECUTED DOCUMENT OF THE FAXED MATERIAL SHOULD SAME NOT HAVE BEEN RECEIVED BY ESCROW HOLDER. Buyer and Seller further acknowledge and agree that documents necessary for recording with non -original (facsimile) signatures will not be accepted for recording by the County Recorder, thus delaying the close of escrow. 9. Parties to this transaction are aware and understand that as a result of the passage of the Tax Reform Act of 1986, which added section 6045(e) to the Internal Revenue Code, the closing of this transaction will be delayed in the event Seller(s) to this escrow should refuse to remit to Escrow Agent/Holder, prior to the close of escrow, "Seller's Certification of Compliance with Real Estate Reporting Requirements," with all necessary information fully completed and duly executed. 10. Parties to this transaction understand that in accordance with Section 18662 and 18668 of the . Revenue and Taxation code, Escrow Holder will be providing the parties with the required NOTICE OF TAX WITHHOLDING REQUIREMENTS, and the closing of this transaction will be delayed in the event any party to this escrow should refuse to remit to Escrow Holder, prior to closing, the written acknowledgement of receipt of said Notice. 11, Escrow Holder shall not be concerned with, or liable for payment, adjustment or proration of, supplemental taxes assessed pursuant to Chapter 498, Statutes of 1983, State of California, unless specifically reflected on the Tax Assessor's rolls. All assessments not shown on the tax rolls are to be adjusted outside of escrow. The title policy will contain an exception for the lien of any assessments of Supplemental taxes pursuant to Chapter 498, Statutes of 1983. 12. In the event Escrow Holder is to deposit any funds into an interest -bearing account at Comerica Bank, NA, at he rate offered at time of investment(s), depositing party will place into escrow a ESCROW NO.: 227049-TD PAGE 3 Date: May 4, 2006 (Revised: May 5, 2006) General Provisions DEPOSIT AND DISBURSEMENT OF FUNDS All funds received in this escrow shall be deposited with other escrow funds in a general escrow account or accounts of North American Title Company, Inc. (hereinafter referred to as "NATC") with any state or national bank or savings and loan, and may be transferred to any other such general escrow account or accounts. Said funds will not earn interest unless specifically instructed. NATC shall have no obligation to account to parties in any manner for the value of, or pay to parties, any benefit received by NATC, directly or indirectly, by reason of the deposit of the escrowed funds or the maintenance of such accounts with that bank. Those benefits may include, without limitation, credits allowed by that bank on loans to NATC and on accounting, reporting and other services and products of that bank and earnings on investments made with the proceeds of such loans. Any such benefits shall be deemed additional compensation earned by NATC for its services as escrow holder. North American Title Company will impose a $25.00 returned item handling fee for each item in this transaction returned unpaid by the drawer's financial institution. North American Title Company may present any deposit item in this transaction for payment by the use of an electronic automated clearing house (ACH) transaction. All disbursements shall be made by check of NATC. NATC shall not be responsible for any delay in closing if funds received by escrow are not available for immediate withdrawal. NATC is authorized not to close escrow or disburse until good funds as provided for in California Insurance Code Section 12413.1 ("AB512") have been confirmed in escrow. If any check submitted to escrow is dishonored upon presentment for payment, you are authorized to notify all principals and/or their respective agents of such nonpayment. In the event any check(s) issued through the escrow or subescrow process, per the attached Sellers/Buyers/Borrowers Statement, are uncashed or unnegotiated ("uncashed") for a period of 150 days after NATC's original issuance of such check(s), then NATC is authorized and instructed to cancel such check(s) and reissue to the same payee(s). The undersigned, both for himself/herself and for any third party payee(s), recognize(s) that NATC incurs significant expense in tracking uncashed checks, canceling and reissuing checks, and maintaining bank and accounting records of such checks. . Since these activities by NATC would be additional services not otherwise contemplated and therefore not compensated by NATC's other fees and charges as shown on the attached Sellers/Buyers/Borrowers Statement, the undersigned acknowledges that a reasonable charge by NATC for such additional services is and will be fifty dollars ($50.00), which will be deducted from the payee's reissued check(s). In the event NATC is requested by payee to cancel and reissue any check prior to the 150 days, NATC is authorized to charge $50 as its fee for such service. If the original canceled check is in an amount of $50 or less, then NATC is authorized and instructed to charge and pay to itself as its fee the entire amount of the check as canceled. NATC has sole discretion and authority to determine when it may be proper not to charge such $50 fee for these services. If any uncashed reissued check also remains uncashed for a period of 150 days, then NATC is authorized and instructed to process the remaining funds for escheatment to the State of California, in accordance with NATC's customary escheatment procedures. CLOSE OF ESCROW The phrase 'close of escrow' (or'COE' or'CE') as used in this escrow means the date on which documents are recorded, unless otherwise specified. Unless otherwise specified in writing, all prorations or . adjustments are to be made as of close of escrow on the basis of a 30-day month. NATC is to use the information contained in the latest available real property tax statement, without regard to any reassessments or subsequent changes. Real property tax bills or statements issued after close of escrow shall be handled directly between buyer and seller outside of escrow. NATC is instructed to assume and shall be fully protected in assuming that all information (for example, association fees, rents, rental deposits, insurance, insurance premiums, beneficiary statements) provided to NATC by the parties of their agent(s) is correct. NATC is authorized to pay all encumbrances necessary to place title in condition called for herein, including but not limited to prepayment penalties, without further approval of the undersigned. Application of payoff funds; Should a check or wire be deemed unacceptable by lenders, creditors, lien holders or beneficiary of a Deed or Trust, you are authorized to act on our behalf in requesting the funds, as well as any balance in an impound account, be applied towards the balance due. 5. SUPPLEMENTAL TAXES The parties acknowledge that the subject property may be subject to real property supplemental taxes due as a result of change of ownership taking place through this escrow, prior changes in ownership, or improvements of the subject property. Any adjustment due on receipt of a supplemental tax bill will be made by the parties outside of this escrow and NATC is released from all liability in connection with same. 6. UTILITIES, WATER, GARBAGE AND ENVIRONMENTAL ISSUES Transfer of utilities, water, and garbage service, or any interruptions or cancellations thereof are to be settled by Buyer and Seller directly and outside of escrow. NATC shall not be responsible for any late payments or nonpayment for any of these services. It is acknowledged that NATC has made no investigation concerning the property as to environmental or hazardous materials issues, and NATC is released of any responsibility or liability in connection with such issues. 7. POSSESSION Possession of the subject property shall be settled by the Buyer and Seller, and NATC shall not be liable or responsible for such possession. 8. RECORDATION OF INSTRUMENTS NATC is authorized and instructed to record any documents delivered through this escrow, the recording of which is necessary or proper in the issuance of the requested policy or policies of title insurance. 9. AUTHORIZATION TO FURNISH COPIES NATC is authorized to furnish copies of preliminary reports, inspection reports, escrow instructions, supplements, amendments or notices of cancellations and closing statements in this escrow to the real estate broker(s) and lender(s) referred to in this escrow. NATC may do so without incurring liability to any party. 10. FIRE, FLOOD, AND HAZARD INSURANCE Other than as may be specifically instructed by lender, NATC is not to be concerned with nor make any inquiry as to any fire, flood, hazard and other liability insurance. 11. PERSONAL PROPERTY TAXES No examination or insurance as to the existence, amount or payment of personal property taxes is required of NATC unless specifically instructed. 12. ACTION IN INTERPLEADER The parties expressly agree that NATC, as Escrow Holder, has the absolute right at its election to file an action in interpleader ESCROW NO.: 227049-TD PAGE 3 Date: May 4, 2006 (Revised: May 5, 2006) General Provisions DEPOSIT AND DISBURSEMENT OF FUNDS All funds received in this escrow shall be deposited.with other escrow funds in a general escrow account or accounts of North American Title Company, Inc. (hereinafter referred to as "NATC") with any state or national bank or savings and loan, and may be transferred to any other such general escrow account or accounts. Said funds will not earn interest unless specifically instructed. NATC shall have no obligation to account to parties in any manner for the value of, or pay to parties, any benefit received by NATC, directly or indirectly, by reason of the deposit of the escrowed funds or the maintenance of such accounts with that bank. Those benefits may include, without limitation, credits allowed by that bank on loans to NATC and on accounting, reporting and other services and products of that bank and earnings on investments made with the proceeds of such loans. Any such benefits shall be deemed additional compensation earned by NATC for its services as escrow holder. North American Title Company will impose a $25.00 returned item handling fee for each item in this transaction returned unpaid by the drawer's financial institution. North American Title Company may present any deposit item in this transaction for payment by the use of an electronic automated clearing house (ACH) transaction. All disbursements shall be made by check of NATC. NATC shall not be responsible for any delay in closing if funds received by escrow are not available for immediate withdrawal. NATC is authorized not to close escrow or disburse until good funds as provided for in California Insurance Code Section 12413.1 ("AB512") have been confirmed in escrow. If any check submitted to escrow is dishonored upon presentment for payment, you are authorized to notify all principals and/or their respective agents of such nonpayment. In the event any check(s) issued through the escrow or subescrow process, per the attached Sellers/Buyers/Borrowers Statement, are uncashed or unnegotiated ("uncashed") for a period of 150 days after NATC's original issuance of such check(s), then NATC is authorized and instructed to cancel such check(s) and reissue to the same payee(s). The undersigned, both for himself/herself and for any third party payee(s), recognize(s) that NATC incurs significant expense in tracking uncashed checks, canceling and reissuing checks, and maintaining bank and accounting records of such checks. . Since these activities by NATC would be additional services not otherwise contemplated and therefore not compensated by NATC's other fees and charges as shown on the attached Sellers/Buyers/Borrowers Statement, the undersigned acknowledges that a reasonable charge by NATC for such additional services is and will be fifty dollars ($50.00), which will be deducted from the payee's reissued check(s). In the event NATC is requested by payee to cancel and reissue any check prior to the 150 days, NATC is authorized to charge $50 as its fee for such service. If the original canceled check is in an amount of $50 or less, then NATC is authorized and instructed to charge and pay to itself as its fee the entire amount of the check as canceled. NATC has sole discretion and authority to determine when it may be proper not to charge such $50 fee for these services. If any uncashed reissued check also remains uncashed for a period of 150 days, then NATC is authorized and instructed to process the remaining funds for escheatment to the State of California, in accordance with NATC's customary escheatment procedures. CLOSE OF ESCROW The phrase 'close of escrow' (or 'COE' or 'CE') as used in this escrow means the date on which documents are recorded, unlPcc ni-hPnnricP cnarifiPri Unless otherwise specified in writing, all prorations or adjustments are to be made as of close of escrow on the basis of a 30-day month. NATC is to use the information contained in the latest available real property tax statement, without regard to any reassessments or subsequent changes. Real property tax bills or statements issued after close of escrow shall be handled directly between buyer and seller outside of escrow. NATC is instructed to assume and shall be fully protected in assuming that all information (for example, association fees, rents, rental deposits, insurance, insurance premiums, beneficiary statements) provided to NATC by the parties of their agent(s) is correct. NATC is authorized to pay all encumbrances necessary to place title in condition called for herein, including but not limited to prepayment penalties, without further approval of the undersigned. Application of payoff funds. Should a check or wire be deemed unacceptable by lenders, creditors, lien holders or beneficiary of a Deed or Trust, you are authorized to act on our behalf in requesting the funds, as well as any balance in an impound account, be applied towards the balance due. 5. SUPPLEMENTAL TAXES The parties acknowledge that the subject property may be subject to real property supplemental taxes due as a result of change of ownership taking place through this escrow, prior changes in ownership, or improvements of the subject property. Any adjustment due on receipt of a supplemental tax bill will be made by the parties outside of this escrow and NATC is released from all liability in connection with same. 6. UTILITIES, WATER, GARBAGE AND ENVIRONMENTAL ISSUES Transfer of utilities, water, and garbage service, or any interruptions or cancellations thereof are to be settled by Buyer and Seller directly and outside of escrow. NATC shall not be responsible for any late payments or nonpayment for any of these services. It is acknowledged that NATC has made no investigation concerning the property as to environmental or hazardous materials issues, and NATC is released of any responsibility or liability in connection with such issues. - 7. POSSESSION Possession of the subject property shall be settled by the Buyer and Seller, and NATC shall not be liable or responsible for such possession. 8. RECORDATION OF INSTRUMENTS NATC is authorized and instructed to record any documents delivered through this escrow, the recording of which is necessary or proper in the issuance of the requested policy or policies of title insurance. 9. AUTHORIZATION TO FURNISH COPIES NATC is authorized to furnish copies of preliminary reports, inspection reports, escrow instructions, supplements, amendments or notices of cancellations and closing statements in this escrow to the real estate broker(s) and lender(s) referred to in this escrow. NATC may do so without incurring liability to any party. 10. FIRE, FLOOD, AND HAZARD INSURANCE Other than as may be specifically instructed by lender, NATC is not to be concerned with nor make any inquiry as to any fire, flood, hazard and other liability insurance. 11. PERSONAL PROPERTY TAXES No examination or insurance as to the existence, amount or payment of personal property taxes is required of NATC unless specifically instructed. 12. ACTION IN INTERPLEADER The parties expressly agree that NATC, as Escrow Holder, has +ho ohcnh 0-o rink+ ni- ifc o1ortinn f n fib- an Artinn in inh-r n1PAr1Pr 14. 15. 16. 17 18. 19. 20 `ESCROW NO.: 227049-TD PAGE 4 NATC is not to be concerned with any question of usury in the processing of this escrow and NATC is hereby released of any responsibility or liability therefor. CANCELLATION OF ESCROW Any principal requesting that NATC cancel this escrow shall file notice of demand to cancel in NATC's office in writing: NATC shall within a reasonable time thereafter mail or otherwise deliver one copy of such notice of demand to cancel to the principals or their respective agents. Unless written objection to such notice of demand to cancel is filed with NATC within fifteen (15) calendar days after the date NATC mailed or delivered the initial notice of demand to cancel, NATC is authorized to cancel this escrow. If NATC cancels this escrow, it is authorized to return the documents to the parties. NATC is, in any event, authorized to hold any money deposited in escrow until it is in receipt of mutual written instructions signed by all parties or the order of a court of competent jurisdiction, concerning the disposition of such money. NATC may return lender's papers and/or funds upon lender's demand. In the event of cancellation of this escrow, the fees and charges due NATC, including expenditures incurred or authorized, shall be borne by the parties or decided by a court of competent jurisdiction. CONFLICTING INSTRUCTIONS Should NATC receive or become aware of any conflicting instructions, demands or claims with respect to this escrow or with respect to any money or property deposited herein or affected, NATC shall have the right to discontinue any or all further acts on its part until in receipt of consistent instructions or until the conflict is resolved to NATC's satisfaction. In the event that any dispute between the parties is submitted to arbitration, NATC is authorized to follow the award or decision of such arbitrator(s), whether or not such arbitration award or decision is'binding' or Tnal.' TERMINATION OF AGENCY OBLIGATIONS If there is no action taken on this escrow for any six month period, NATC's agency obligation shall terminate at its option and NATC shall be authorized to return all documents, monies or other items to the parties depositing same. This shall not limit NATC's right to withdraw as escrow agent from this transaction at any time. In the event or termination of NATC's agency obligations, the parties shall pay its fees, charges and any expenses incurred. RIGHT OF RESIGNATION NATC has the right to resign as Escrow Holder, upon reasonable written notice, and it is acknowledged that five calendar days shall be deemed reasonable under this paragraph. If such right is exercised, NATC is authorized to return all funds and documents to the party who deposited them and NATC shall have no further liability in this escrow. MEMORANDA NATC is to be concerned only with the directives specifically set forth in the escrow instructions and amendments hereto, and is not to be concerned with or liable for items designated as 'memoranda' in the within escrow instruction, nor with any other agreement or contract between the parties. DESTRUCTION OF RECORDS NATC is authorized to destroy or otherwise dispose of any and all documents, papers, instructions, correspondence and other material pertaining to this escrow at the expiration of seven years from the close of escrow or cancellation thereof, without liability and without further notice to parties in the transaction. CHANGE OF OWNERSHIP Revenue and Taxation Code Section 480.3 requires that Buyers complete a Preliminary Change of Ownership Report (PCOR)`. for all deeds and other documents which reflect change in ownership of real property. If such PCOR is not presented at time of recording, or is incomplete, a fee of $20 or as required by law will be charged to the appropriate party. NATC is raliavari of all liahilitir nr racnnncihihi-y ac to the valiriity_ Date: May 4, 2006 harmless for such reporting. The Parties also agree to provide to NATC all documentation and information requested by NATIC to comply.with reporting requirements. 22. FOREIGN INVESTOR REAL PROPERTY TAX ACT(S) Under Section 1445 of the Internal Revenue Code as amended ("Section 1445"), the Foreign Investment in Real Property Tax Act ("FIRPTA"), every Buyer of U.S. real property must, unless an exemption applies, deduct and shall deduct and hold from seller's proceeds ten percent (10%) of the gross sales price. NATC is released from and shall have no liability, obligation or responsibility with respect to (a) withholding of funds pursuant to Section 1445(b) advising the parties as to the requirements of such section, (c) determining whether the transferor is a foreign person under such Section, or (d) obtaining a non - foreign affidavit or other basis for an exemption of such section, or otherwise making any inquiry concerning compliance with such Section by any party to the transaction. State Withholding & Reporting for closings alter January 1, 2003: Under California Law (Rev & Tax Code 18662) a buyer may be required to withhold and deliver to the Franchise Tax Board (FTB) an amount equal to 3.33 % of the sales price in the case of disposition of California real property interest ("Real Property'9 by either:1) A seller who is an individual or when the disbursement instructions authorize the proceeds to be sent to a financial intermediary of seller, or Z) a corporation seller that has no permanent place of business in California. Buyer may be subject to a penalty (equal to the greater of 10961 of the amount required to be withheld or $500) for failing to withhold and transmit the funds to FTB in the time required by law. Buyer is not required to withhold any amount and will not be subject to penalty for failure to withhold if, a) the sale price of the Real Property does not exceed $100, 000; b) the seller executes a written certificate under penalty of perjury certifying that the seller is a corporation with a permanent place of business in California; or c) the seller, who is an individual, executes a written certificate underpenalty of perjury certifying one of the following: (i) the Real Property was the seller's principal residence (as defined in IRC 121); (il) the Real Property is or will be exchanged for property of like kind (as defined in IRC 1031) and that the seller intends to acquire property similar or related in service to use so as to be eligible for nonrecognition of gain for California income tax purposed under IRC 1031; (iii) the Real Property has been compulsorily or involuntarily converted (as defined in IRC 1033) and the seller intends to acquire property similar or related in service or use as to be eligible for nonreognitition of gain for California income tax purposes under IRC 1033; or (iv) the Real Property sale will result in loss of California income tax purposes Seller is subject to penalties for knowingly filing a fraudulent certificate for the purpose ofa voiding the withholding laws FTS may grant reduced withholding and waivers from withholding on a case -by -case basis for corporations or other entities Contact FTB. For additional information regarding California withholding, contact the Franchise Tax Board at (toll free) 888-792-4900, by email at urwsnotfb.ca.c7ov or visit their website at www,ftb.ca. c7ov. 22. DISCLOSURE OF TAXPAYER IDENTIFICATION NUMBERS Internal Revenue Code Section 6109(h) imposes requirements for furnishing, disclosing and including taxpayer identification numbers in tax returns on the Parties to a residential real estate transaction involving seller -provided Financing. The parties understand that the disclosure reporting requirements are exclusive obligations between the Parties to this transaction and that NATC is not obligated to transmit the taxpayer identification numbers to the Internal Revenue Service or to the Parties. NATC is not rendering an opinion concerning the effect of this law on this transaction, and the Parties are not relying upon any statements made or nmiftari by the esrrnw nr dnsinn nfFcer. 14 15 16 17 18 19. 20. 'ESCROW NO.: 227049-TD PAGE 4 NATC is not to be concerned with any question of usury in the processing of this escrow and NATC is hereby released of any responsibility or liability therefor. CANCELLATION OF ESCROW Any principal requesting that NATC cancel this escrow shall file notice of demand to cancel in NATC's office in writing. NATC shall within a reasonable time thereafter mail or otherwise deliver one copy of such notice of demand to cancel to the principals or their respective agents. Unless written objection to such notice of demand to cancel is filed with NATC within fifteen (15) calendar days after the date NATC mailed or delivered the initial notice of demand to cancel, NATC is authorized to cancel this escrow. If NATC cancels this escrow; it is authorized to return the documents to the parties. NATC is, in any event, authorized to hold any money deposited in escrow until it is in receipt of mutual written instructions signed by all parties or the order of a court of competent jurisdiction, concerning the disposition of such money. NATC may return lender's papers and/or funds upon lender's demand. In the event of cancellation of this escrow, the fees and charges due NATC, including expenditures incurred or authorized, shall be borne by the parties or decided by a court of competent jurisdiction. CONFLICTING INSTRUCTIONS Should NATC receive or become aware of any conflicting instructions, demands or claims with respect to this escrow or with respect to any money or property deposited herein or affected, NATC shall have the right to discontinue any or all further acts on its part until in receipt of consistent instructions or until the conflict is resolved to NATC's satisfaction. In the event that any dispute between the parties is submitted to arbitration, NATC is authorized to follow the award or decision of such arbitrator(s), whether or not such arbitration award or decision is `binding' or 'final.' TERMINATION OF AGENCY OBLIGATIONS If there is no action taken on this escrow for any six month period, NATC's agency obligation shall terminate at its option and NATC shall be authorized to return all documents, monies or other items to the parties depositing same. This shall not limit NATC's right to withdraw as escrow agent from this transaction at any time. In the event or termination of NATC's agency obligations, the parties shall pay its fees, charges and any expenses incurred. RIGHT OF RESIGNATION NATC has the right to resign as Escrow Holder, upon reasonable written notice, and it is acknowledged that five calendar days shall be deemed reasonable under this paragraph. If such right is exercised, NATC is authorized to return all funds and documents to the party who deposited them and NATC shall have no further liability in this escrow. MEMORANDA NATC is to be concerned only with the directives specifically set forth in the escrow instructions and amendments hereto, and is not to be concerned with or liable for items designated as 'memoranda' in the within escrow instruction, nor with any other agreement or contract between the parties. DESTRUCTION OF RECORDS NATC is authorized to destroy or otherwise dispose of any and all documents, papers, instructions, correspondence and other material pertaining to this escrow at the expiration of seven years from the close of escrow or cancellation thereof, without liability and without further notice to parties in the transaction. CHANGE OF OWNERSHIP Revenue and Taxation Code Section 480.3 requires that Buyers complete a Preliminary Change of Ownership Report (PCOR) for all deeds and other documents which reflect change in ownership of real property. If such PCOR is not presented at time of recording, or is incomplete, a fee of $20 or as required by law will be charged to the appropriate party. NATC is .-..It...-A -4: -JI -------r-ihili+,,-,.-+-- 4-k- -1;,44" Date: May 4, 2006 harmless for such reporting. The Parties also agree to provide to NATC all documentation and information requested by NATIC to comply with reporting requirements. 22. FOREIGN INVESTOR REAL PROPERTY TAX ACT(S) Under Section 1445 of the Internal Revenue Code as amended ("Section 1445"), the Foreign Investment in Real Property Tax Act ("FIRPTA"), every Buyer of U.S. real property must, unless an exemption applies, deduct and shall deduct and hold from seller's proceeds ten percent (10%) of the gross sales price. NATC is released from and shall have no liability, obligation or responsibility with respect to (a) withholding of funds pursuant to Section 1445(b) advising the parties as to the requirements of such section, (c) determining whether the transferor is a foreign person under such Section, or (d) obtaining a non - foreign affidavit or other basis for an exemption of such section, or otherwise making any inquiry concerning compliance with such Section by any party to the transaction. State Withholding & Reporting for closings after January 1, 2003; Under California Law (Rev & Tax Code 18662) a buyer may be required to withhold and deliver to the Franchise Tax Board (FTB) an amount equal to 3.33% of the sales price in the case of disposition of California real property interest ("Real Property'q by either- 1) A seller who is an individual or when the disbursement instructions authorize the proceeds to be sent to a financial intermediary of seller, or2) a corporation seller that has no permanent place of business in California. Buyer may be subject to a penalty (equal to the greater of 10% of the amount required to be withheld or $500) for failing to withhold and transmit the funds to FTB in the time required by law. Buyer is not required to withhold any amount and will not be subject to penalty for failure to withhold if., a) the sale price of the Real Property does not exceed $100, 000; b) the seller executes a written certificate under penalty of pe1jury certifying that the seller is a corporation with a permanent place of business in California; or c) the seller, who is an individual, executes a written certificate under penalty of perjury certifying one of the following: (i) the Real Property was the seller's principal residence (as defined In IRC 121); (ii) the Real Property is or will be exchanged for property of like kind (as defined in IRC 1031) and that the seller intends to acquire property similar or related in service to use so as to be eligible for nonrecognition of gain for California income tax purposed under IRC 1031; (iii) the Real Property has been compulsorily or involuntarily converted (as defined in IRC 1033) and the seller intends to acquire property similar or related in service or use as to be eligible for nonreognitition of gain for California income tax purposes under IRC 1033, or (iv) the Real Property sale will result in loss of California income tax purposes Seller is subject to penalties for knowingly filing a fraudulent certificate for the purpose of avoiding the withholding laws FI"B may grant reduced withholding and waivers from withholding on a case -by -case basis for corporations or other entities Contact FTB. For additional information regarding California withholding, contact the Franchise Tax Board at (toll free) 888-792-4900, by email at urw5c&t1-b. ca. go v or visit their website at www,ftb.ca. 4ov, 22. DISCLOSURE OF TAXPAYER IDENTIFICATION NUMBERS Internal Revenue . Code Section 6109(h) imposes requirements for furnishing, disclosing and including taxpayer identification numbers in tax returns on the Parties to a residential real estate transaction involving seller -provided Financing. The parties understand that the disclosure reporting requirements are exclusive obligations between the Parties to this transaction and that NATC is not obligated to transmit the taxpayer identification numbers to the Internal Revenue Service or to the Parties. NATC is not rendering an opinion concerning the effect of this law on this transaction, and the Parties are not relying upon any statements made or 24. 25. 26 PYA ESCROW NO.: 227049-TD PAGE 5 hold NATC harmless from and against any fees, costs, or judgments incurred and/or awarded in connection with the release of taxpayer identification numbers. "FAXIELECTRONIC" TRANSMISSIONS NATC is authorized to accept and rely upon instructions and amendments thereto as such may be submitted via facsimile machines (`FAX') or electronic media. The parties hereby agree and instruct Escrow Holder to rely upon such documents bearing original signatures The parties hereby agree to provide to Escrow Holder the original documents within 72 hours of transmission. The parties further acknowledge and agree that documents necessary for recording by the County. Recorder must contain original/notarized signatures, and therefore, non -receipt of the original document(s) to record can delay the close of escrow. AGREEMENT OF CO-OPERATION (Unjust Enrichment) In the event that any party to this escrow received funds or is credited with funds that they are not entitled to, for whatever reason, they agree upon written demand, to return said funds to the proper party entitled or to the escrow for disbursement. In the event that suit is brought to enforce the return of said funds, the parties agree to reimburse the prevailing party to reasonable Attorney Fees. OFFICIAL BUSINESS HOURS NATC's official business hours are 8 am through 5 pm Monday through Friday, unless otherwise posted. MISCELLANEOUS FEES The Buyer/Borrower(s) hereby agree to pay an electronic delivery fee in the event lender chooses to send the loan documents electronically. NATC may also charge a fee for special courier services. A per check charge for payment of consumer debt (credit cards and other non -secured loans), wiring of funds due the lender to satisfy an existing loan and/or the proceeds due the Seller(s), Buyer/Borrower(s) and for drawing any additional documents necessary to close this transaction. Date: May 4, 2006 28. CONTINGENCY PERIODS Escrow Holder shall not be responsible for monitoring contingency time periods between the parties. The parties shall execute such documents as may be requested by Escrow Holder, to confirm the status of any such period. 29. IMPORTANT NOTICE Except for wire transfers, funds remitted to the escrow are subject to availability requirements by Sections 123413.1 of the California Insurance Code. CASHIERS, CERTIFIED OR TELLER'S checks, payable to NATC are generally available. for disbursement on the next business day following the date of deposit to .North American Title Company Trust Account. Other forms of payment may cause extended delays in the closing of your transaction pursuant to the requirements imposed by State Law. (Wire transfer information available upon request.) 30. ESCROW INSTRUCTIONS, COUNTERPART APPROVAL AND SEVERABILITY Any escrow instruction, amendment of supplement to these instructions must be in writing. Collectively, these escrow instructions constitute the entire escrow between the Escrow Holder and the parties. These escrow instructions, amendments and supplements may be executed in one or more counterparts, each of which independently shall have the same effect as if it were the original, regardless of date of execution or delivery, and all of which taken together shall constitute one and the same instructions. In these instructions, whenever the context so requires, the masculine gender includes the feminine and/or neuter, and the singular includes the plural. In the event one or more of these General Provisions is held to be invalid in judicial, administrative or other proceedings, the remaining General Provisions will continue to be operative. Should there be any conflict between these General Provisions and any other agreements of which these General Provisions are a part, all the terms and conditions of these General Provisions shall control as to NATC. Once the Parties have performed and/or satisfied all conditions to escrow, NATC is authorized to close escrow without further instruction or authorization from the undersigned. ESCROW NO.: 227049-TD PAGE 5 Date: May 4, 2006. 24. 25. 26 27. hold NATC harmless from and against any fees, costs, or judgments incurred and/or awarded in connection with the release of taxpayer identification numbers. "FAXIELECTRONIC" TRANSMISSIONS NATC is authorized to accept and rely upon instructions and amendments thereto as such may be submitted via facsimile machines ('FAX') or electronic media. The parties hereby agree and instruct Escrow Holder to rely upon such documents bearing original signatures The parties hereby agree to provide to Escrow Holder the original documents within 72 hours of transmission. The parties further acknowledge and agree that documents necessary for recording by the County Recorder must contain original/notarized signatures, and therefore, non -receipt of the original document(s) to record can delay the close of escrow. AGREEMENT OF CO-OPERATION (Unjust Enrichment) In the event that any party to this escrow received funds or is credited with funds that they are not entitled to, for whatever reason, they agree upon written demand, to return said funds to the proper party entitled or to the escrow for disbursement. In the event that suit is brought to enforce the return of said funds, the parties agree to reimburse the prevailing party to reasonable Attorney Fees. OFFICIAL BUSINESS HOURS NATC's official business hours are 8 am through 5 pm Monday through Friday, unless otherwise posted. MISCELLANEOUS FEES The Buyer/Borrower(s) hereby agree to pay an electronic delivery fee in the event lender chooses to send the loan documents electronically. NATC may also charge a fee for special courier services. A per check charge for payment of consumer debt (credit cards and other non -secured loans), wiring of funds due the lender to satisfy an existing loan and/or the proceeds due the Seller(s), Buyer/Borrower(s) and for drawing any additional documents necessary to close this transaction. 28. CONTINGENCY PERIODS Escrow Holder shall not be responsible for monitoring contingency time periods between the parties. The parties shall execute such documents as may be requested by Escrow Holder, to confirm the status of any such period. 29. IMPORTANT NOTICE Except for wire transfers, funds remitted to the escrow are subject to availability requirements by Sections 123413.1 of the California Insurance Code. CASHIERS, CERTIFIED OR TELLER'S checks, payable to NATC are generally available for disbursement on the next business day following the date of deposit to North American Title Company Trust Account. Other forms of payment may cause extended delays in the closing of your transaction pursuant to the requirements imposed by State Law. (Wire transfer information available upon request.) 30. ESCROW INSTRUCTIONS, COUNTERPART APPROVAL AND SEVERABILITY Any escrow instruction, amendment of supplement to these instructions must be in writing. Collectively, these escrow instructions constitute the entire escrow between the Escrow Holder and the parties. These escrow instructions, amendments and supplements may be executed in one or more counterparts, each of which independently shall have the same effect as if it were the original, regardless of date of execution or delivery, and all of which taken together shall constitute one and the same instructions. In these instructions, whenever the context so requires, the masculine gender includes the feminine and/or neuter, and the singular includes the plural. In the event one or more of these General Provisions is held to be invalid in judicial, administrative or other proceedings, the remaining General Provisions will continue to be operative. Should there be any .conflict between these General Provisions and any other agreements of which these General Provisions are a part, all the terms and conditions of these General Provisions shall control as to NATC. Once the Parties have performed and/or satisfied all conditions to escrow, NATC is authorized to close escrow without further instruction or authorization from the undersigned. ESCROW NO.: 227049-TD PAGE 6 Date: May 4, 2006 (Revised: May 5, 2006) THIS AGREEMENT IN ALL PARTS APPLIES TO, INURES TO THE BENEFIT OF, AND BINDS ALL PARTIES HERETO, THEIR HEIRS, LEGATEES, DEVISEES, ADMINISTRATORS, EXECUTORS, SUCCESSORS AND ASSIGNS, AND WHENEVER THE CONTEXT SO REQUIRES THE MASCULINE GENDER INCLUDES THE FEMININE AND NEUTER, AND THE SINGULAR NUMBER INCLUDES THE PLURAL. THESE INSTRUCTIONS AND ANY OTHER AMENDMENTS MAY BE EXECUTED IN ANY NUMBER OF COUNTERPARTS, EACH OF WHICH SHALL BE CONSIDERED AS AN ORIGINAL AND BE EFFECTIVE AS SUCH. MY SIGNATURE HERETO CONSTITUTES INSTRUCTION TO ESCROW HOLDER OF ALL TERMS AND CONDITIONS CONTAINED IN THIS AND ALL PRECEDING PAGES AND FURTHER SIGNIFIES THAT I HAVE READ AND UNDERSTAND THESE GENERAL PROVISIONS. ESCROW HOLDER IS NORTH AMERICAN TITLE COMPANY, INC., WHICH IS LICENSED BY THE CALIFORNIA DEPARTMENT OF INSURANCE. EACH OF THE UNDERSIGNED STATES THAT HE/SHE/THEY HAS/HAVE READ THE FOREGOING INSTRUCTIONS AND UNDERSTAND(S) AND AGREE(S) TO THEM, AND ACKNOWLEDGE(S) A RECEIPT OF A COPY THEREOF. BUYER: Alpine Universal, Inc., a California corporation By: James H. Schladen, President SELLER: City of Veropn, a body corporate and politic By:m" Bruce V) Malkenhorst, Jr. Its: ActinkgClerk Approved as tra form: By: Jeff ri n, Chi Assistant City Attorney *** End of Instructions *** ESCROW NO.: 227049-TD Date: May 4, 2006 (Revised: May 5, 2006) PAGE 6 THIS AGREEMENT IN ALL PARTS APPLIES TO, INURES TO THE BENEFIT OF, AND BINDS ALL PARTIES HERETO, THEIR HEIRS, LEGATEES, DEVISEES, ADMINISTRATORS, EXECUTORS, SUCCESSORS AND ASSIGNS, AND WHENEVER THE CONTEXT SO REQUIRES THE MASCULINE GENDER INCLUDES THE FEMININE AND NEUTER, AND THE SINGULAR NUMBER INCLUDES THE PLURAL. THESE INSTRUCTIONS AND ANY OTHER AMENDMENTS MAY BE EXECUTED IN ANY NUMBER OF COUNTERPARTS, EACH OF WHICH SHALL BE CONSIDERED AS AN ORIGINAL AND BE EFFECTIVE AS SUCH. MY SIGNATURE HERETO CONSTITUTES INSTRUCTION TO ESCROW HOLDER OF ALL TERMS AND CONDITIONS CONTAINED IN THIS AND ALL PRECEDING PAGES AND FURTHER SIGNIFIES THAT I HAVE READ AND UNDERSTAND THESE GENERAL PROVISIONS. ESCROW HOLDER IS NORTH AMERICAN TITLE COMPANY, INC., WHICH IS LICENSED BY THE CALIFORNIA DEPARTMENT OF INSURANCE. EACH OF THE UNDERSIGNED STATES THAT HE/SHE/THEY HAS/HAVE READ THE FOREGOING INSTRUCTIONS AND UNDERSTAND(S) AND AGREE(S) TO THEM, AND ACKNOWLEDGE(S) A RECEIPT OF A COPY THEREOF. BUYER: Alpine UrjnNk s�l�, 7hc.,#)Worfia corporation By: President SELLER: City of Vernon, a body corporate and politic By: Bruce V. Malkenhorst, Jr. Its: Acting City Clerk Approved as to form: By: Jeff Harrison, for Karns & Karabian, General Counsel *** End of Instructions *** ESCROW NO.: 227049-TD PAGE 7 LEGAL DESCRIPTION LEGAL DESCRIPTION ATTACHED HERETO AS EXHIBIT A AND MADE A PART HEREOF Date: May 4, 2006 ESCROW NO.: 227049-TD PAGE 7 LEGAL DESCRIPTION LEGAL DESCRIPTION ATTACHED HERETO AS EXHIBIT A AND MADE A PART HEREOF Date: May 4, 2006 EXHIBIT "A" (LEGAL DESCRIPTION) THAT PORTION OF THE SOUTHWEST QUARTER OF THE SOUTHEAST QUARTER OF THE SOUTHWEST QUARTER OF SECTION 10, TOWNSHIP 2 SOUTH, RANGE 13 WEST, SAN BERNARDINO MERIDIAN, IN THE CITY. OF VERNON, COUNTY OF LOS ANGELES, STATE OF CALIFORNIA, ACCORDING TO THE OFFICIAL PLAT OF SAID LAND FILED IN THE DISTRICT LAND OFFICE: APRIL 22, 1968, IN THE CITY OF VERNON, DESCRI$'ED AS FOLLOWS:' BEGINNING AT THE POINT OF INTERSECTION OF THE EAST LINE OF THE SOUTHWEST QUARTER OF THE SOUTHWEST QUARTER OF THE SOUTHWEST QUARTER OF SAID SECTION WITH THE NORTH LINE OF VERNON AVENUE, SAID POINT BEING DISTANT NORTH 890 26' 30" EAST 2005.60 FEET FROM THE INTERSECTION OF SAID NORTH LINE WITH THE EASTERLY LINE OF THE 30 FOOT RIGHT OF WAY ACQUIRED BY THE LOS ANGELES AND SAN PEDRO RAILWAY COMPANY BY CONDEMNATION, A CERTIFICATE COPY OF THE DECREE THEREOF BEING RECORDED IN BOOK 1 PAGE 531, MISCELLANEOUS RECORDS OF SAID COUNTY; THENCE ALONG THE EAST LINE OF THE SOUTHWEST QUARTER OF THE SOUTHEAST QUARTER OF THE SOUTHWEST QUARTER OF SAID SECTION, (SAID LINE BEING ALSO THE WEST LINE OF LOT "A" OF TRACT N0, 2164, IN SAID CITY, AS PER MAP RECORDED IN BOOK 32 PAGE 46 OF MAPS RECORDS OF SAID COUNTY, NORTH 00 52' 45" WEST 601.50 FEET TO THE SOUTHEAST CORNER OF A PARCEL OF LAND CONVEYED TO THE SOUTHERN PACIFIC RAILROAD. COMPANY BY DEED RECORDED IN BOOK 1203 PAGE 178, OF OFFICIAL RECORDS OF SAID COUNTY; THENCE WESTERLY ALONG THE SOUTHERLY LINE OF SAID PARCEL ON A CURVE CONCAVE TO THE SOUTHWEST, HAVING A RADIUS OF 278.34 FEET,'.44.12 FEET TO THE SOUTHERLY LINE OF THE LAND DESCRIBED AS PARCEL "A" IN AGREEMENT RECORDED IN BOOK 6293 PAGE 204 OF DEEDS, RECORDS OF SAID COUNTY; THENCE ALONG SAID SOUTHERLY LINE, SOUTH 89' 28' 15" WEST 390.85 FEET TO THE NORTH CORNER OF THE LAND CONVEYED TO E.C. WILSON BY DEED RECORDED IN BOOK 7250 PAGE 91 OF SAID DEED RECORDS; THENCE ALONG THE WESTERLY LINE OF SAID LAST MENTIONED LAND, SOUTH 0° 51' 45" EAST 605.22 TO THE NORTH LINE OF VERNON AVENUE; THENCE EASTERLY ALONG SAID NORTH LINE, 434.78 FEET TO THE POINT OF BEGINNING. EXHIBIT "A" (LEGAL. DESCRIPTION) THAT PORTION OF THE SOUTHWEST QUARTER OF THE SOUTHEAST QUARTER OF THE SOUTHWEST QUARTER OF SECTION 10, TOWNSHIP 2 SOUTH, RANGE 13 WEST, SAN BERNARDINO MERIDIAN, IN THE CITY OF VERNON, COUNTY OF LOS ANGELES, STATE OF CALIFORNIA, ACCORDING TO THE. OFFICIAL PLAT OF SAID LAND'FILED IN THE DISTRICT LAND OFFICE APRIL 22, 1968, IN THE CITY OF VERNON, DESCRI$'ED AS FOLLOWS: BEGINNING AT THE POINT OF INTERSECTION OF THE EAST LINE OF THE SOUTHWEST QUARTER OF THE SOUTHWEST QUARTER OF THE SOUTHWEST QUARTER OF SAID SECTION WITH THE NORTH LINE OF VERNON AVENUE, SAID POINT BEING DISTANT NORTH 89° 26' 30" EAST 2005.60 FEET FROM THE INTERSECTION OF SAID NORTH LINE WITH THE EASTERLY LINE OF THE 30 FOOT RIGHT OF. WAY ACQUIRED BY THE LOS ANGELES AND SAN PEDRO RAILWAY COMPANY BY CONDEMNATION, A CERTIFICATE COPY OF THE DECREE THEREOF BEING RECORDED IN BOOK 1 PAGE 531, MISCELLANEOUS RECORDS OF SAID COUNTY; THENCE ALONG THE EAST LINE OF THE SOUTHWEST QUARTER OF THE SOUTHEAST QUARTER OF THE SOUTHWEST QUARTER OF SAID SECTION, (SAID LINE BEING ALSO THE WEST LINE OF LOT "A" OF TRACT NO, 2164, IN SAID CITY, AS PER MAP. RECORDED IN BOOK 32 PAGE 46 OF MAPS RECORDS OF SAID COUNTY, NORTH 00 52' 45" WEST 601.50 FEET TO THE SOUTHEAST CORNER OF A PARCEL OF LAND CONVEYED TO THE SOUTHERN PACIFIC RAILROAD. COMPANY BY DEED RECORDED IN BOOK 1203 PAGE 178, OF OFFICIAL RECORDS OF SAID COUNTY; THENCE WESTERLY ALONG THE SOUTHERLY LINE OF SAID PARCEL ON A CURVE CONCAVE TO THE SOUTHWEST, HAVING A RADIUS OF 278.34 FEET,'.44.12 FEET TO THE SOUTHERLY LINE OF THE LAND DESCRIBED AS PARCEL "A" IN AGREEMENT RECORDED IN BOOK 6293 PAGE 204 OF DEEDS', RECORDS OF SAID COUNTY; THENCE ALONG SAID SOUTHERLY LINE, SOUTH 89' 28' 15" WEST 390.85 FEET TO THE NORTH CORNER OF THE LAND CONVEYED TO E.C. WILSON BY DEED RECORDED IN BOOK 7250 PAGE 91 OF SAID DEED RECORDS; THENCE ALONG THE WESTERLY LINE OF SAID LAST MENTIONED LAND, SOUTH 0° 51' 45" EAST 605.22 TO THE NORTH LINE OF VERNON AVENUE; THENCE EASTERLY ALONG SAID NORTH LINE, 434.78 FEET TO THE POINT OF BEGINNING. May 4, 2006 ESCROW NO.:227049-TD PRIVACY POLICY NOTICE We at North American Title Company take your privacy very seriously. We do not share your private information with anyone except as necessary to complete your real property, title insurance and escrow transaction. Our Privacy Policies and Practices: Information we collect and sources from which we collect it: We collect nonpublic information about you from the following sources: ■ Information we receive from you on applications or other forms. ■ Information about your transactions with us, our affiliates or others. ■ Information from non-affiliated third parties relating to your transaction. "Nonpublic personal information" is nonpublic information about you that we obtain in connection with providing a product or service to you. 1. What information we disclose and to whom we disclose it: We do not disclose any nonpublic. personal information about you to either our affiliates or non -affiliates without your express consent, except as permitted or required by law. We may disclose the nonpublic personal information we collect, as described above, to persons or companies that perform services on our behalf regarding your transaction "Our Affiliates" are companies with which we share common ownership and which offer real property, title insurance, or escrow services. 2. Our security procedures: We restrict access to your nonpublic personal information and only allow disclosures to persons and companies as permitted or required by law to assist in providing products or services to you. We maintain physical, electronic, and procedural safeguards to protect your nonpublic personal information. 3. Your right to access your personal information: You have the right to review your personal information that we record about you. If you wish to review that information, please contact your local North American Title office and give us reasonable time to make that information available to you. If you believe any information is incorrect, notify us, and if we agree, we will correct it. If we disagree, we will advise you in writing why we disagree. 4. Customer acknowledgment: Your receipt of escrow documents accompanied by this Notice, or execution of our General Provisions where this Notice may be attached will constitute your acknowledgment of receipt of this Privacy Policy Nntinp. May_4, 2006 ESCROW NO.:227049-TD PRIVACY POLICY NOTICE We at North American Title Company take your privacy very seriously. We do not share your private information with anyone except as necessary to complete your real property, title insurance and escrow transaction. Our Privacy Policies and Practices: Information we collect and sources from which we collect it: We collect nonpublic information about you from the following sources: ■ Information we receive from you on applications or other forms. ■ Information about your transactions with us, our affiliates or others. ■ Information from non-affiliated third parties relating to your transaction. "Nonpublic personal information" is nonpublic information about you that we obtain in connection with providing a product or service to you. 1. What information we disclose and to whom we disclose it: We do not disclose any nonpublic personal information about you to either our affiliates or non -affiliates without your express consent, except as permitted or required by law. We may disclose the nonpublic personal information we collect, as described above, to persons or companies that perform services on our behalf regarding your transaction "Our Affiliates" are companies with which we share common ownership and which offer real property, title insurance, or escrow services. 2. Our security procedures: We restrict access to your nonpublic personal information and only allow disclosures to persons and companies as permitted or required by law to assist in providing products or services to you. We maintain physical, electronic, and procedural safeguards to protect your nonpublic personal information. 3. Your right to access your personal information: You have the right to review your personal information that we record about you. If you wish to review that information, please contact your local North American Title office and give us reasonable time to make that information available to you. If you believe any information is incorrect, notify us, and if we agree, we will correct it. If we disagree, we will advise you in writing why we disagree. 4. Customer acknowledgment: Your receipt of escrow documents accompanied by this Notice, or execution of our General Provisions where this Notice may be attached will constitute your acknowledgment of receipt of this Privacy Policy Nntice_ 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 Partiesthat 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 58,350,000.00, 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 coritingency. 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, 4— i:,.. A A ,a.......,,.e....t,.,ii *,__i,,.de +i, ;,,+Ammat R„�,ar'c FPrinral Tair Mi-.ntifirafinn Niimher i.c 7T-Q 75n)6R 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. be 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. 63 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. s.s Escrow Holder shall verify that all of Buyer's Contingencies have been satisfied or waived prior to Closing. 5.6 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. 6.6 Except as otherwise provided herein, the termination of Escrow shall not relieve or release either Parry 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. 6.1 o 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 rr,e r,i 4 T ^-P +M, +r:,n +;,,n rtnn+;naPnt nnnn the caticfartion or waiver of the followinz (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 ivlan'datory 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. (f) 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 aDDrove the survey Drovided by Seller or obtain and anorove its own ALTA survev. Buver may elect within 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 exceotions aooroved by Buyer. In the event there is a Purchase Money Deed of Trustin this transaction, the 1p. Representations and Warranties of Seller and Disclaimers. io.i 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. Bap= -farther A, a b 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, Iegal, 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 Iaws; 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. to.d 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. io.s 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 AFF CTED HIS SETTLEMENT WITH THE DEBTOR. A %�, Buyer's Initials Seller's Initials 11. Possession. Possession of the Prooerty shall be liven to Buver at the Closing. 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 attomeys' 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. 1s.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 S200,000.00. 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' Initials Seller's Initials 18. Miscellaneous. 18.1 Binding Effect. This Agreement shall be binding on the Parties if signed and if the paragraphs 0 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. is. 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. #T aF—ali • ■ • •• • Title: Date: Address: t4 �( Facsimile: c �a 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:i.� Leoni : Malbur.g> MaY or Atfe r: I n-- ruc . Malkenhorst, Jr. Acting City Clerk Dated: aCb atsd G Approved As to Form By: Eric T. Fresch, City Attorney Dated -I e , J �g Address: 4305 Santa Fe Avenue Vernon, CA 90058 Telephone: 323-5 83-8811 Fax: 323-826-1438 Federal ID No.: 95-6000808 AddendunVo 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 obiect and/or sueeest modifications to the Work Plan. In the event (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.anysuch exchange. 25. Multiple Offers. Until the Closing, Seller may accept backup offers. 26. ARBITRATION OF DISPUTES: 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 SHALT, 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 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. BUY 'S INITIALS SELLER'S INITIALS Executed as of the date first above written. SELLER: City of Vernon Leonis C. Malburg, Mayor Attes�i' B Malkenhorst, Jr. Acting City Clerk Approved As to Form By: Eric T. Fresch, City Attomey BUYER: