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1991-253 - Modifying The Purchase Agreement For 17 Fiesta WayRESOLUTION 1991 -253 RESOLUTION OF THE TOWN COUNCIL OF THE TOWN OF LOS GATOS MODIFYING THE PURCHASE AGREEMENT FOR 17 FIESTA WAY WHEREAS, the Town Council authorized the modification and extension of the option and purchase agreements for 17 Fiesta Way on 10/21/91, and WHEREAS, the property owner has requested minor changes in the terms of the agreement approved on 10/21/91, relating to closing costs and the tenants' occupancy, NOW, THEREFORE, BE IT RESOLVED that the Town Council approves the modification of the purchase agreement on the attached form. PASSED AND ADOPTED at a regular meeting of the Town Council of the Town of Los Gatos, California on the 18th of November, 1991, by the following vote: COUNCIL MEMBERS: AYES: Randy Attaway, Joanne Benjamin, Steven Blanton, Brent N. Ventura, Mayor Eric D. Carlson NAYS: None ABSENT: None ABSTAIN: None SIGNED: Zc--, MAYOR OF THE TOWN OF LOS GATOS LOS GATOS, CALIFORNIA ATTEST: CLERK OF THE TOWN OF OS GATOS LOS GATOS, CALIFORNIA AGREEMENT, WILL NOT BE SIGNED UNTIL GRANT IS APPROVED' RE: PEGGY 11 /20/91 CONTRACT OF SALE Preamble CONTRACT OF SALE entered into , 1991 by and between Joe Ann Pfaff, surviving joint tenant (hereafter referred to as "Seller ") and the Town of Los Gatos, a municipal corporation (hereafter referred to as 'Buyer "). Seller agrees to sell and convey, and Buyer agrees to purchase, the real property located at 17 Fiesta Way in the Town of Los Gatos, Santa Clara County, California (hereafter referred to as "the Property "), and more particularly described in Exhibit A, which is attached to this Contract and hereby incorporated by reference, on the following terms and conditions: ARTICLE 1. PURCHASE PRICE Amount and Terms of Payment Section 1.01. The total purchase price of the Property is $200,000 payable by Buyer to Seller upon the close of escrow. ARTICLE 2. ESCROW Opening of Escrow Section 2.01. An escrow shall be opened to consummate the sale of the Property according to the terms of this Contract at the office of Valley Title Company (hereafter referred to as the "escrow holder ") at 300 South First Street, San Jose, California, 95113. The escrow shall be opened within 3 days after the execution of this Contract. Written escrow instructions in accordance with the terms of this Contract shall be prepared by each party, and the instructions shall be signed by the parties and delivered to the escrow holder within 15 days of the execution of this Contract. Buyer and Seller shall also de- posit with the escrow holder all instruments, documents, and other items (i) identified in the escrow instructions or (ii) reasonably required by the escrow holder to close the sale on the closing date specified below. Closing Date Section 2.02. The escrow shall be closed on the date the deed is recorded. The escrow shall be considered to be in a condition to close when the escrow holder is authorized un- der the escrow instructions, and when the escrow holder is otherwise able, to record the grant deed. The escrow must be in a condition to close no later than 120 days after execution of this Agreement, unless the closing date is extended pursuant to the terms of this Contract. antyO05 \17fiesta.eon 1 November 11, 1991 Prorations Section 2.03. The following shall be prorated between Seller and Buyer on the basis of a 30 -day month as of the date on which escrow closes: real property taxes and dues. Broker's Commission Section 2.04. No real estate agent or broker is involved in this transaction and no broker's fees or commission shall be paid. Closing Costs Section 2.05. Buyer shall pay any transfer taxes, the cost of the CLTA title insurance policy required by this Contract, any reconveyance and recording fees, charged for the reconveyance of any deed of trust, and the cost of preparing, executing, and acknowledging the grant deed and all other instruments necessary to convey title to Buyer. Buyer shall pay the cost of recording the grant deed and any other instruments re- quired to convey title to Buyer and the escrow fee. Vesting of Title Section 2.06. On the close of escrow, title shall be vested in the Town of Los Gatos, a municipal corporation. ARTICLE 3. ADDITIONAL TERMS AND CONDITIONS Miscellaneous Conditions Section 3.01. The close of escrow opened pursuant to Section 2.01, and Buyer's obligation to purchase the Property pursuant to this Contract, are subject to the satisfaction of the following conditions, which are solely for Buyer's benefit unless otherwise indicated: Marketable Title (a) The conveyance to Buyer of good and marketable title to the Property, as evidenced by a California Land Title Association standard coverage title insurance policy issued by Valley Title Company in the full amount of the purchase price insuring that title to the Property is vested in Buyer free and clear of all title defects, liens, encumbrances, conditions, covenants, restrictions, and other adverse interests of record or known to Seller, subject only to those exceptions approved by Buyer in writing and the following: a lien for current real property taxes. antyW5 \17fiesta.00n 2 November 11, 1991 Delivery of Possession (b) The delivery, of possession of the Property (with all keys to locks and all garage door openers) to Buyer immediately on the close of escrow free and clear of all uses and occupancies except that current tenants Rick Pfaff and Ken McMillan ( "current tenants ") may continue their tennancy provided that by the close of escrow, the current tenants enter into a rental agreement with Buyer on terms and conditions consistent with those for current market rate rental units and the provisions of State relocation law (Gov. Code Section 7260 et seq.). Physical Condition of the Property (c) Buyer's satisfaction, in its sole discretion, with the physical condition of the Property after completing any or all of the tests permitted under Section 4.01. Failure of Condition and Seller's Breach of Warranty Section 3.02. If any of the conditions set forth in this Contract fails to occur, or if Buyer notifies Seller in writing prior to the close of escrow of Seller's breach of any of Seller's warranties set forth in this Contract, then Buyer may cancel the escrow, terminate this Contract, and recover the amounts paid by Buyer to the escrow holder toward the purchase price of the Property. Buyer shall exercise this power to terminate by complying with any applicable notice requirements specified in the relevant condition and, in all other cases, by providing written notice to Seller and the escrow holder within 20 days of the failure or breach. The exercise of this power shall not waive any other rights Buyer may have against Seller for breach of this Contract. Seller shall instruct the escrow holder, in the escrow instructions delivered pursuant to Section 2.01, to refund to Buyer all money and instruments deposited in escrow by Buyer pursuant to this Contract upon failure of a condition or conditions or breach of a warranty or warranties and receipt of a termination notice. This instruction shall be irrevocable. In the event of such a termination, Seller shall bear any costs and expenses of escrow. Seller's Election to Remedy Defects Section 3.03. Notwithstanding any provision of this Contract to the contrary, Seller shall have the right to remedy certain violations of this Contract prior to the close of es- crow. This right to remedy shall be subject to the following requirements and restrictions: (a) Buyer shall immediately notify Seller in writing of Buyer's discovery, prior to the close of escrow, of a violation of any of the following provisions of this Agreement: Sections, 3.02, 4.02. For these purposes, the foregoing violations shall be referred to as "defects." (b) If Buyer fails to give notice, Buyer shall waive the defect and the defect shall not be a violation of this Contract. If Buyer gives notice, Seller may elect to remedy the defect by giving Buyer written notice of this election within 5 days of anty005 \17fiesta.con 3 November 11, 1991 receiving Buyer's notice. Seller's notice of election to remedy shall specify the number of days (if any), up to a maximum of 10 that escrow shall be postponed so that Seller may remedy the defect. If Seller fails to provide a timely notice of election or fails to remedy the defect prior to the close of escrow (including any extension of escrow pursuant to this Section), then Buyer, at Buyer's election, may do either of the following: (1) Terminate the Contract without any liability, on the part of either party; or (2) Purchase the Property without a reduction in the purchase price and without any liability for the unremedied defect or defects on the part of Seller. The failure by Buyer to make such an election shall be deemed an election of option 2. (c) Seller shall instruct the escrow holder, in the escrow instructions delivered pursuant to Section 2.01, to immediately refund to Buyer all money and instruments deposited in escrow by Buyer pursuant to this Contract on termination of this Contract pursuant to this Section, and on receipt of notice of that termination from Buyer. In the event of such a termination, Seller shall bear any costs and expenses of the escrow. ARTICLE 4. RIGHTS, WARRANTIES AND INDEMNIFICATION Right of Buyer to Enter Property Section 4.01. Seller grants to Buyer, or Buyer's agents, the right, at any time and from time to time within three (3) days after the opening of the escrow for this transaction, to enter onto the Property to conduct tests or investigations, provided that: (a) The acts shall be conducted at the sole cost and expense of Buyer; (b) The acts do not unreasonably interfere with occupant's possession; (c) Buyer shall indemnify and hold Seller harmless from any costs or liability resulting from the acts, and, if the escrow is canceled for a reason that is not the fault of Seller, for any damage to the Property resulting from the acts; and (d) Buyer shall give occupant written notice of the intention to enter two (2) days prior to the date of the planned entry. Warranties of Seller Section 4.02. Seller warrants that: (a) Seller does not live on the Property and is not entitled to relocation assistance under Gov. Code Section 7260 et seq. antyO05 \17fiestaxon 4 November 11, 1991 (b) Seller owns the Property, free and clear of all liens, licenses, claims, encumbrances, easements, encroachments on the Property from adjacent properties, encroachments by improvements on the Property onto adjacent properties, and rights of way, of any nature, not disclosed by, the public record. (c) Seller has no knowledge of any pending litigation or claims involving the Property. (d) Seller has no knowledge of any violations of, or notices concerning defects or noncompliance with any, applicable building code or other code, statute, regulation, ordinance, judicial order, or judicial holding pertaining to the Property. Seller has not received any notice from any governmental authority relating to defects in the Property or non - compliance with any applicable law, code or regulation. (e) Seller is not in default under any contract, note, or encumbrance relating to the Property. (f) Seller is not engaged in any business on the Property and does not and will not lose or make any claim for loss of goodwill as a result of this Agreement. (g) Seller will maintain the Property in good repair and in the same condition, reasonable wear and tear excepted, it was in when it was inspected by Buyer on July 10, 1991. (h) Seller has no knowledge that there are now or ever have been underground storage tanks located on the Property, no knowledge that hazardous waste has been released on the Property, and no knowledge that there is asbestos or PCB present anywhere on the Property. (i) Seller has delivered true, accurate and complete copies of all documents, surveys, plans and specifications describing the Property and known by Seller to exist; and no documents supplied to Buyer from Seller contain any untrue statement of material fact or fail to state any fact, which would be necessary, in light of the circumstances, to render the documents supplied not misleading. Seller's Indemnification for Toxic or Hazardous Materials Section 4.03. If any toxic or hazardous materials are discovered which were on the Property before close of escrow, Seller will defend, indemnify and hold the Buyer harmless for any and all costs of identification, evaluation, removal, and remediation. Warranties of Buyer Section 4.04. Buyer warrants that purchase of this Property is in lieu of condemnation since acquisition is necessary for construction of a public library at this site. anty005 \17fiesta.wn 5 November 11, 1991 Survival of Warranties Section 4.05. All warranties, covenants, and other obligations described in this Article and elsewhere in this Contract shall survive delivery of the deed. loss: ARTICLE 5. MISCELLANEOUS PROVISIONS Loss, Destruction, and Condemnation Section 5.01. The parties agree that the following provisions shall govern the risk of (a) If, before Seller transfers legal title or possession of the Property to Buyer, all or a material part of the Property is destroyed without fault of Buyer, or is taken by eminent domain by any other governmental entity, Buyer shall be entitled to elect to recover any portion of the price Buyer has paid, and Seller shall not have the right to enforce this Contract. For these purposes, "material part of the Property" means improvements on the Property that would cost $1,000 or more to replace or to restore to their condition as of the date of execution of this Contract. (b) If after Seller transfers legal title or possession of the Property to Buyer, all or any part of the Property, is destroyed without fault of Seller, or is taken by eminent domain by any other governmental entity, Buyer is not relieved from Buyer's obligation under this Contract to pay the full price for the Property, nor is Buyer entitled to recover any portion of the price Buyer has paid. (c) If at any, time prior to the close of escrow, damage, destruction, or condemnation occurs, and this loss is not covered by Subsections (a) or (b) of this Section, shall be entitled to offset the cost of repair or replacement against the purchase price of the Property. Insurance Section 5.02. Buyer shall be responsible for obtaining insurance on the Property as of close of escrow and shall not be responsible for any obligations or payments associated with seller's insurance on the Property. Cooperation Section 5.03. Each party agrees to take such further action and to execute and deliver such further documents as may be reasonable or necessary in order to carry out the purposes of this agreement. antyW5 \17tiesta.con 6 November 11, 1991 Assignment Section 5.04. Buyer may not assign this Contract without Seller's prior written consent. The valid assignment of this Contract shall not relieve Buyer of liability under this Con- tract. Time of Essence Section 5.05. Time is of the essence in this Contract. Notices Section 5.06. Any notice, tender, delivery, or other communication pursuant to this Contract shall be in writing and shall be deemed to be properly given if delivered, mailed, or sent by wire or other telegraphic communication in the manner provided in this Section, to the following persons: (a) If to Buyer: David W. Knapp, Town Manager Town of Los Gatos 110 East Main Street P.O. Box 949 Los Gatos, CA 95031 (b) If to Seller: Joe Ann Pfaff 17 Fiesta Way Los Gatos, CA 95032 Either party may change that party's address for these purposes by giving written notice of the change to the other party in the manner provided in this section. If sent by mail, any notice, delivery, or other communication shall be effective or deemed to have been given 48 hours after it has been deposited in the United States mail, duly registered or certified, with postage prepaid, and addressed as set forth above. If sent by wire or other form of telegraphic communication, any notice, delivery, or other communication shall be effective or deemed to have been given eight hours after it has been deposited with Western Union, or other carrier, prepaid and addressed as set forth above. Entire Agreement Section 5.07. This Contract and the attached Exhibits constitute the entire agreement between the parties relating to the sale of the Property. Any prior agreements, promises, negotiations, or representations not expressly set forth in this Contract are of no force and effect. Any amendment to this Contract shall be of no force and effect unless it is in writing and signed by Buyer and Seller. antyW5 \171iesta.con 7 November 11, 1991 Attorneys' Fees Section 5.08. If any action, proceeding, or arbitration arising out of or relating to this Contract is commenced by either party to this Contract or by the escrow holder, then as between Buyer and Seller, the prevailing party shall be entitled to receive from the other party, in addition to any other relief that may be granted, the reasonable attorneys' fees, costs, and expenses incurred in the action, proceeding, or arbitration by the prevailing party. Binding Effect Section 5.09. This Contract shall be binding on and inure to the benefit of the parties to this Contract and their heirs, personal representatives, successors, and assigns, except as otherwise provided in this Contract. Governing Law Section 5.10. This Contract and the legal relations between the parties shall be governed by and construed in accordance with the laws of the State of California. Headings Section 5.11. The headings of the articles and sections of this Contract are inserted for convenience only. They do not constitute part of this Contract and shall not be used in its construction. Waiver Section 5.12. The waiver by any party to this Contract of a breach of any provision of this Contract shall not be deemed a continuing waiver or a waiver of any subsequent breach of that or any other provision of this Contract. Dated this day of , 1991. SELLER JOE AN PFAFF BUYER DAVID W. KNAPP, TOWN MANAGER TOWN OF LOS GATOS ��— Ap roved as to form antyO05 \17fiesta.00n 8 November 11, 1991