08 Staff Report - 15900 Los Gatos Boulevard~pW N 0
s ca COUNCIL AGENDA REPORT
DATE: June 1, 2007
TO: MAYOR AND TOWN COUNCIL
FROM: ORRY P. KORB, TOWN ATTORNE &
MEETING DATE: 6-4-07
AGENDA ITEM:
SUBJECT: ADOPT A RESOLUTION APPROVING AN AGREEMENT OF PURCHASE
AND SALE AND ESCROW INSTRUCTIONS TO ACQUIRE REAL PROPERTY
LOCATED AT 15900 LOS GATOS BOULEVARD FROM VERIZON
CALIFORNIA INC.
RECOMMENDATION:
Adopt a resolution approving an Agreement of Purchase and Sale and Escrow Instructions to acquire real
property located at 15900 Los Gatos Boulevard from Verizon California Inc.
BACKGROUND:
In February 2007 the Town submitted a letter of intent to acquire improved real property from Verizon
California Inc. located at 15900 Los Gatos Boulevard for the purpose of relocating police services from
the Town civic center complex. Staff proceeded thereafter to complete the steps necessary to acquire the
property. These included the negotiation of a purchase agreement to be executed by the Town and
Verizon. These negotiations have concluded in the draft agreement attached hereto (Attachment).
DISCUSSION:
The proposed agreement calls for the Town to acquire 1.09 acres of land improved with a 1-story building
containing approximately 8,600 square feet of space. The essential terms of the proposed agreement are
as follows:
• Purchase price of $3.2 million.
• Refundable deposit of $50,000 due upon execution of the agreement.
• Town to have until July 17, 2007, to complete feasibility studies regarding the proposed purchase,
PREPARED BY: ORRY P. KORB, TOWN ATTORNEY OPK:LMB/wp [N:\ATY\Reports\1590O LGS PA Rpt.wpa]
Reviewed by: Town Manager Assistant Town Manager Clerk
Finance Community Development
Rev: 611/07 5:16 pm
Reformatted: 7/19/99 He# 301-05
PAGE 2
MAYOR AND TOWN COUNCIL
SUBJECT:
June 1, 2007
during which time Town has the right to terminate the transaction. Note that feasibility studies,
including architecture, traffic, noise, structural and environmental, are well under way or already
concluded. Because Council will not be meeting in July, staff will, on June 18, ask Council to
determine whether to take the steps necessary to finalize the acquisition.
• Second deposit of $50,000 at the conclusion of the feasibility period.
• Town to accept future liability for environmental hazards on site. Note that Phase I and H
environmental studies are already completed and reveal no hazardous materials contamination on the
property.
• Balance of payment ($3.1 million) to be deposited in escrow no less than two days prior to closing.
• Escrow to close no later than July 31, 2007.
The proposed agreement has been reviewed by The Town Attorney and by outside real estate counsel. The
Town Attorney recommends the proposed agreement for approval by Council.
ENVIRONMENTAL ANALYSIS:
Purchase of the property is considered a "project" according to the California Environmental Quality
Act (CEQA). As required by CEQA, an Initial Study and a Mitigated Negative Declaration have been
prepared. The Town's consultant, Geier & Geier Consulting, completed the environmental review.
The recommended mitigation measures will lessen potentially significant impacts. Council will be
asked to adopt the Mitigated Negative Declaration on June 18, 2007, at which time Council will be
asked to determine whether to take the steps necessary to complete the acquisition.
FISCAL ANALYSIS:
Approval of the proposed agreement will obligate the Town to deposit a refundable $50,000. Staff
will be prepared to answer any questions from Council regarding the recommended source of funds for
the deposit. The resolution authorizes the Town Manager to draw $50,000 from available contingency
funds for purposes of making the refundable deposit.
Attachments:
Resolution (proposed agreement is Exhibit "A" to the Resolution)
Distribution:
Erik Hallgrimson, CPS
He# 301-05
RESOLUTION
RESOLUTION OF THE TOWN COUNCIL OF THE TOWN OF LOS GATOS
APPROVING AN AGREEMENT OF PURCHASE AND SALE
AND ESCROW INSTRUCTIONS TO ACQUIRE REAL PROPERTY LOCATED AT
15900 LOS GATOS BOULEVARD FROM VERIZON CALIFORNIA INC.
WHEREAS, Verizon California, Inc. ("Verizon") owns real property located at 15900 Los Gatos
Boulevard, which includes a 1-story building containing approximately 8,600 square feet of space on an
approximately 1.09 acre parcel; and
WHEREAS, the Town desires to purchase that improved real property for the operation and
providing of police services; and
WHEREAS, representatives of the Town and Verizon have negotiated the terms of a proposed
Agreement of Purchase and Sale and Escrow Instructions, attached hereto and incorporated herein as
Exhibit "A", and
WHEREAS, the Town and Verizon desire to go forward with the proposed acquisition, subject to
the terms and conditions of the proposed Agreement.
RESOLVED, by the Town Council of the Town of Los Gatos, County of Santa Clara, State of
California, that:
The a proposed Agreement of Purchase and Sale and Escrow Instructions is hereby
approved in substantially the same form as Exhibit "A" hereto.
2. The Town Manager is hereby authorized to execute an Agreement of Purchase and Sale
and Escrow Instructions in substantially the same form as Exhibit "A" hereto.
3. The Town Manager is hereby authorized to draw $50,000 from available Town
contingency funds for purposes of making the required initial refundable deposit pursuant to the
Agreement of Purchase and Sale and Escrow Instructions.
C:\D0CLME-1\TEMPAT-1.LOS\LOCALS--1\TEMP\XPGRPWISE\15900 LGB PA RESO 1.DOC
PASSED AND ADOPTED at a regular meeting of the Town Council of the Town of Los Gatos,
California, held on the 4th of June, 2007 by the following vote:
COUNCIL MEMBERS:
AYES:
NAYS:
ABSENT:
ABSTAIN:
SIGNED:
MAYOR OF THE TOWN OF LOS GATOS
LOS GATOS, CALIFORNIA
ATTEST:
CLERK ADMINISTRATOR OF THE TOWN OF LOS GATOS
LOS GATOS, CALIFORNIA
C:\DOCUME-1\TEMPAT-I.LOS\LOCALS-1\TEMP\XPGRPWISE\15900 LGB PA RESO LDOC
AGREEMENT OF PURCHASE AND SALE
AND ESCROW INSTRUCTIONS
This Agreement of Purchase and Sale and Escrow Instructions (the "Agreement")
is made as of March 16, 2007 by and between Verizon California Inc., a California corporation
("Seller"), and Town of Los Gatos, a municipal corporation ("Buyer").
Recitals
A. Seller is the owner of the "Property" (as defined in Paragraph 1.1 below)
which includes a 1-story building (in cold dark shell condition) containing approximately 8,600
square feet of space on an approximately 1.09 acre parcel commonly known as 15900 Los Gatos
Boulevard, Los Gatos, California. The Property is currently part of a larger parcel of land owned
by Seller containing approximately 1.77 acres in the aggregate (collectively, the "Master
Parcel"). Seller is currently in the process of obtaining a parcel map, as more particularly
described in Paragraph 2.11 below, in order to legally subdivide the Property from the balance of
the Master Parcel.
B. Seller desires to sell the Property to Buyer and Buyer desires to purchase
the Property from Seller on the terms and conditions contained in this Agreement.
THE PARTIES AGREE AS FOLLOWS:
Sale of Property; Purchase Price.
1.1 Sale of Property. Seller shall sell to Buyer and Buyer shall
purchase from Seller, at the price and upon the terms and conditions set forth in this Agreement:
(i) that certain real property which includes a 1-story building containing approximately 8,600
square feet of space on an approximately 1.09 acre parcel of land located at 15900 Los Gatos
Boulevard, Los Gatos, California, and more particularly described in Exhibit "1.1" (the "Land");
(ii) any improvements situated on the Land (the "Improvements"); and (iii) all appurtenances to
the Land owned by Seller, including, without limitation, all development rights, air rights,
mineral rights, water, water rights and water stock relating to the Land (the "Appurtenant
Rights"). The Land, the Improvements, and the Appurtenant Rights are collectively referred to
herein as the "Real Property." The Real Property, and the Personal Property, if any, as described
in Paragraph 1.2 below are collectively referred to herein as the "Property." The parties have
acknowledged and agreed that as soon as it is available, a legal description of the Real Property,
as modified by the "Subdivision Approval" (as defined in Paragraph 2.11 below), will be
initialed by Buyer and Seller and shall replace Exhibit "1.1" to this Agreement.
1.2 Sale of Personal Property. Buyer acknowledges that no personal
property ("Personal Property") is being conveyed to Buyer pursuant to this Agreement.
1.3 Purchase Price. Buyer shall pay to Seller as the total purchase
price for the Property (the "Purchase Price") the sum of $3,200,000 payable as follows:
4485114.3 EXHIBIT A
1.3.1 Deposit. Buyer shall deliver the sum of $50,000 (the
"Initial Deposit") to "Escrow Holder" (as defined in Paragraph 2.1 below) in immediately
available funds concurrently with the delivery of the Agreement. Buyer acknowledges and
agrees that notwithstanding the initial execution of the Agreement, no agreement shall exist
between Seller and Buyer until the Initial Deposit is delivered to Escrow Holder, and Seller shall
have no obligations to Buyer with respect to the Property until the Initial Deposit is delivered.
Provided Buyer has not terminated this Agreement prior to the end of the "Feasibility Period," as
defined in Paragraph 2.9.1 below, Buyer shall deliver an additional sum of $50,000 (the
"Additional Deposit") in immediately available funds to Escrow Holder prior to the end of the
Feasibility Period. If Buyer fails to deliver the Additional Deposit within the time period set
forth in this paragraph, this Agreement shall automatically terminate and the provisions of
Paragraph 2.12 below shall apply. Escrow Holder is irrevocably authorized and instructed to
deliver the Initial Deposit and Additional Deposit (collectively, the "Deposit") to Seller upon the
expiration of the Feasibility Period if Buyer has not terminated this Agreement prior to such
expiration date. Buyer agrees to execute all documentation reasonably required by Escrow
Holder to effectuate the release of funds in accordance with the terms of this Subparagraph 1.3.1.
Any interest on the Initial Deposit, earned prior to the expiration of the Feasibility Period, shall
accrue to the benefit of Buyer.
1.3.2 Balance. The sum of $3,100,000 (the "Balance"),
constituting the balance of the Purchase Price, shall be deposited by Buyer in immediately
available funds into Escrow no later than two (2) business days before the "Closing Date" (as
defined in Paragraph 2.2 below).
2. Escrow; Closing Conditions.
2.1 Escrow. No later than five (5) business days after the execution of
this Agreement by Buyer and Seller, Buyer and Seller shall open an escrow (the "Escrow") with
Fidelity National Title (the "Escrow Holder") and shall deliver a fully executed copy of this
Agreement to Escrow Holder. The deposit with Escrow Holder of (1) a fully executed original
of this Agreement and (2) the Initial Deposit by Buyer shall constitute the opening of Escrow
(the "Opening of Escrow") and authorization to Escrow Holder to act in accordance with the
terms of this Agreement. Escrow Holder's standard provisions are attached hereto as
Exhibit "2.1" and shall become a part hereof; provided, however that if there is any conflict or
inconsistency between such standard provisions and this Agreement, then this Agreement shall
control.
2.2 Closing Date. The Escrow shall close on July 31, 2007 (the
"Closing Date"); provided, however, that if Seller has not obtained the Subdivision Approval by
such scheduled Closing Date, then Seller shall have the right to extend the Closing Date for up to
ninety (90) days in order to obtain said Subdivision Approval. Notwithstanding the foregoing,
the "Closing" (as defined in Paragraph 2.7 below) or Close of Escrow shall not occur unless the
conditions to the Close of Escrow set forth in this Agreement have been satisfied or waived,
including, without limitation, (i) the conditions set forth in Paragraphs 2.9, 2. 10, and 2.11 below,
(ii) the condition that all items described in Paragraphs 2.5 and 2.6 below shall have been
deposited with Escrow Holder, and (iii) the condition that the "Title Company" (as defined in
Paragraph 2.3 below) has unconditionally committed to issue the "Title Policy" (as defined in
4485114.3 -2-
Paragraph 2.3 below). If any of such conditions have not been satisfied or waived on or before
the Closing Date, this Agreement and the Escrow shall terminate; provided, however that such
termination shall not affect any claims that either party may have against the other for any breach
of this Agreement. If neither party is in default hereunder, upon any termination of this
Agreement, the provisions of Paragraph 2.12 shall apply.
2.3 Title and Title Insurance. Seller shall convey title to the Real
Property to Buyer by a grant deed in the form of Exhibit "23" attached hereto (the "Grant
Deed"). At the "Close of Escrow," Fidelity National Title (the "Title Company"), shall issue
through Escrow an Owner's Policy of Title Insurance (the "Title Policy") with CLTA coverage,
unless Buyer elects ALTA coverage and pays the additional cost of such coverage pursuant to
Paragraph 2.4.2 below, in which event the Title Company shall issue the Title Policy with ALTA
coverage, with liability in the amount of the Purchase Price, insuring fee title to the Real
Property vested in Buyer, subject only to the following exceptions (the "Permitted Exceptions"):
(i) the standard printed exceptions set forth in the Title
Policy;
delinquent or payable over time;
(ii) general and special taxes and assessments not then
(iii) those certain exceptions which have been approved
by Buyer as provided in Paragraph 2.9.4 below;
2.10.1 below; and
Buyer.
2.4 Costs.
(iv) the "Easement Agreement" as defined in Paragraph
(v) any exceptions to title created by or made through
2.4.1 Escrow Holder's fees with respect to the Escrow shall be
shared equally by Seller and Buyer.
2.4.2 Seller shall pay the premium for a CLTA Standard Policy
of Title Insurance. The additional cost for an ALTA Owner's Policy, if selected by Buyer, and
any endorsements to the Title Policy requested by Buyer shall be paid for by Buyer. Buyer shall
pay all costs and expenses, if any, incurred in connection with its obtaining a survey of the
Property.
2.4.3 All expenses and charges incurred in connection with the
discharge of delinquent taxes, if any, or monetary liens or monetary encumbrances on the
Property, other than (a) those created by or made through Buyer, (b) bonds, taxes and
assessments payable over time, except to the extent payable by Seller under Subparagraph 2.4.4
below, (c) interests granting royalties to third parties, (d) liens arising out of any legal
proceedings encumbering the Property, notwithstanding the fact that such liens could be
44851143 -3-
discharged by the payment of money, and (e) any exception to title that cannot expressly, by its
terms, be discharged by payment of money, shall be paid by Seller.
2.4.4 All installments of bonds, special taxes or assessments
which are a lien on the Property and due and payable in full prior to the time of Closing shall be
prorated in the manner set forth in Paragraph 2.8.1 below; provided, however, that in
determining any amount payable by Seller, such assessments shall be amortized over the longest
period of time permitted by the taxing authority to make such payment, even if the assessment is
assessed as a lump sum.
2.4.5 Each party shall be responsible for payment of the fees and
expenses of its counsel relating to this Agreement and the transactions contemplated hereby.
2.4.6 Any county documentary or transfer taxes and recording
fees shall be paid by Seller. Any city documentary or transfer taxes shall be paid one-half by
Buyer and one-half by Seller.
2.4.7 Any other closing costs or charges shall be paid by the
party that customarily pays such costs or charges in the County of Santa Clara, California.
2.5 Deposit of Documents and Funds by S. Seller shall deposit
with Escrow Holder the following items no later than two (2) business days prior to the Closing
Date, duly executed and acknowledged where required:
2.5.1 The Grant Deed.
2.5.2 A completed California Franchise Tax Board Form 593-W
and an affidavit certifying that Seller is not a "foreign person" as defined in the Internal Revenue
Code.
2.5.3 All other documents as may reasonably be required by
Escrow Holder or the Title Company to close the Escrow in accordance with this Agreement.
2.6 Deposit of Documents and Funds by Buyer. Buyer shall deposit
with Escrow Holder the following items no later than two (2) business days prior to the Closing
Date, duly executed and acknowledged where required:
2.6.1 The Balance plus such additional funds as are required to
pay Buyer's costs and prorations as provided in Paragraph 2.4 above and Paragraph 2.8 below,
less any credits Buyer is entitled to hereunder.
2.6.2 A completed and originally executed Preliminary Change
of Ownership Report in the form required by the Santa Clara County Recorder's Office (the
"Change of Ownership Report").
2.6.3 A certified copy of resolutions of the governing body of
Buyer adopted at a meeting of such governing body approving this Agreement and the
4485114.3 -4-
transactions contemplated hereunder ("Buyer's Resolutions"), as soon after such meeting as the
Buyer's Resolutions are available.
2.6.4 All other funds and documents as may be reasonably
required by Escrow Holder or the Title Company to close the Escrow in accordance with this
Agreement.
2.7 Delivery of Documents and Funds at Closing. The performance of
the acts set forth in this paragraph shall constitute the "Closing" or the "Close of Escrow" as
such terms are used in this Agreement. The Escrow Holder shall conduct the Closing by
recording and distributing the following described documents and funds in the following manner:
2.7.1 Deliver Buyer's Resolutions to Seller.
2.7.2 Deliver to Seller on the Closing Date immediately available
funds in the sum of the Balance, and such other funds, if any, due Seller by reason of prorations,
less Seller's closing costs and prorations, if any, as provided in Paragraph 2.4 above and
Paragraph 2.8 below, and any credits Buyer is entitled to hereunder.
2.7.3 Pay the costs referred to in Paragraph 2.4 above.
2.7.4 Record the Grant Deed in the Office of the County
Recorder of Santa Clara County and simultaneously deliver the Change of Ownership Report to
such Office.
2.7.5 Obtain and deliver the original Title Policy to Buyer and a
copy to Seller.
2.8 Prorations.
2.8.1 Taxes. Escrow Holder shall prorate on a 365-day basis the
ad valorem taxes on the Real Property for the current fiscal year and all installments of bonds,
special taxes, and assessments payable over time as of the Close of Escrow based upon the most
current real estate tax information available. Buyer acknowledges that Seller is obligated to pay
to the California State Board of Equalization the ad valorem taxes on the Real Property for the
entire tax fiscal year during which the Close of Escrow occurs even though (a) Seller will own
the Property for less than the entire fiscal year, and (b) such payment may be due following the
Close of Escrow. Therefore, Buyer agrees that at the Close of Escrow Seller shall be credited
and Buyer shall be debited an amount equal to that portion of the ad valorem taxes on the
Property attributable to the period from the Close of Escrow to the end of the tax fiscal year in
which the Close of Escrow occurs. Any bill for supplemental ad valorem taxes ("Supplemental
Taxes") on the Real Property which is issued after the Close of Escrow shall be prorated by
Buyer and Seller outside of Escrow after the Close of Escrow. Each party shall remit its pro rata
share of any such Supplemental Taxes, as reasonably determined by Seller and approved by
Buyer, such Buyer's approval not to be unreasonably withheld, to the requesting party outside of
Escrow within ten (10) days after such party's receipt of a copy of the bill for such Supplemental
Taxes from the requesting party. Notwithstanding the proration procedure described above,
Buyer shall assume and shall pay all taxes and assessments (including all roll-back taxes and
4485114.3 -5-
assessments) levied or assessed against any portion of the Real Property as the result of a change
in the use or ownership of the Real Property occurring from and after the Closing Date, and shall
defend, indemnify, and hold Seller harmless from any cost, expense, liability, or obligation
(including, without limitation, reasonable attorneys' fees and costs) with respect to any such
taxes or assessments. This provision shall survive the Close of Escrow.
2.8.2 Utilities. Escrow Holder shall prorate through Escrow, on
a 365-day basis, all water, gas, electric and other utility services, if any, on the Property. Any
such item that is not determinable at the Closing shall be adjusted by the parties by cash payment
outside of Escrow when determined.
2.9 Buyer's Conditions to Closing. Buyer shall not be obligated to
proceed to the Close of Escrow and the Closing shall not occur unless and until, in addition to all
other conditions contained in this Agreement, the following conditions have been satisfied or
waived in writing by Buyer:
2.9.1 Evaluation of Property. On or before the expiration of the
period ending sixty (60) days from the full execution of this Agreement, but no later than July
17, 2007 (the "Feasibility Period"), Buyer, in Buyer's sole discretion, shall have approved the
Property, including, without limitation, the results of all inspections, tests or studies of the
Property conducted by or on behalf of Buyer. Buyer shall deliver to Seller, promptly upon
receipt, copies of all written inspection results, tests and studies of the Property conducted by or
on behalf of Buyer; provided, however, that Buyer shall not be obligated to deliver to Seller
proprietary information relating to Buyer's potential use of the Property, including architectural
studies and evaluations. Further, without limiting the generality of the foregoing, Buyer shall
have approved the feasibility of its obtaining such governmental approvals as may be required
for Buyer's proposed use of the Property, including, without limitation, any changes in zoning
(the "Zoning Approvals"), and shall have delivered written notice thereof to Seller and Escrow
Holder. Buyer's failure to notify Seller or Escrow Holder prior to the expiration of the
Feasibility Period of Buyer's disapproval of the Property or any of Buyer's feasibility studies
shall constitute Buyer's election to proceed to the Close of Escrow. All inspections, tests and
studies conducted by Buyer shall be at Buyer's sole cost and expense. Prior to the Closing,
Buyer shall deliver to Seller copies of all applications, plans and specifications, environmental
reports and other documentation for Zoning Approvals for Seller's information concurrently with
Buyer's submission thereof to any applicable government authority and shall invite Seller to
attend all meetings and hearings related to such Zoning Approvals. Buyer agrees that prior to the
Closing Buyer shall keep Seller reasonably informed as to the status of Buyer's progress in
obtaining all Zoning Approvals. Prior to the Closing, Seller shall cooperate with Buyer as
reasonably requested by and at the sole expense of Buyer (and to the extent possible) for the
purpose of obtaining all Zoning Approvals and permits required in connection with Buyer's
proposed use of the Property; provided, however, that the effectiveness of any such Zoning
Approvals affecting the Property shall be expressly conditioned upon the occurrence of the Close
of Escrow and shall not be binding upon Seller.
2.9.2 Related Documents. Within 10 days following the
execution of this Agreement by Buyer and Seller, Seller shall have delivered to Buyer a copy of
the most recent survey of the Property in Seller's possession and copies of any technical studies
4485114.3 -6-
or reports in Seller's possession and which are located at the office of (1) Seller's Broker,
(2) Verizon California Inc. Building Services Department, and (3) Verizon California Inc.
Environmental Compliance Department regarding the environmental, seismic, or geological
condition of the Property. Seller (a) has not independently investigated any information included
in such survey, studies or report; and (b) has not made and does not make any representations or
warranty regarding the truth, accuracy or completeness of the information made available to
Buyer. Seller shall use commercially reasonable efforts to deliver the documentation described
above to Buyer; provided, however that Buyer acknowledges and agrees that despite Seller's
commercially reasonable efforts to deliver to Buyer the documentation described herein,
documents may inadvertently not be provided to Buyer, and Buyer shall make its own
independent inspection of the Property in the manner set forth in Paragraph 5 below.
Notwithstanding anything to the contrary contained in this Paragraph 2.9.2, Seller does not
represent or warrant that any such survey, studies or reports exist or are in Seller's possession,
and Buyer assumes the entire risk of any inadvertent failure by Seller to deliver any documents
to Buyer.
2.9.3 Evaluation of Title Report. Promptly following the
execution of this Agreement by Buyer and Seller, the Title Company shall have delivered to
Buyer a preliminary title report issued by the Title Company (the "Preliminary Report") for the
Property (as well as copies of all title documents referred to therein).
2.9.4 Title Review.
(i) Approval. Buyer shall not have disapproved the
Preliminary Report within the earlier of (a) fifteen (15) calendar days after the receipt of the
Preliminary Report and copies of all documents referenced therein, or (b) the expiration of the
Feasibility Period. Buyer shall provide to Seller and Escrow Holder written notice of Buyer's
disapproval of any title exception (the "First Notice"). Any title exception not so disapproved
shall be deemed approved, provided that if a supplemental report is issued showing any
exception not shown on the Preliminary Report, Buyer shall have an additional fifteen (15)
calendar days after receipt of such supplemental report and copies of all documents referred to
therein (not previously provided to Buyer) to approve or disapprove any such title exception.
Notwithstanding anything to the contrary contained in the foregoing paragraph, Buyer shall not
be entitled to extend the title review beyond the expiration of the Feasibility Period for any
supplemental title report issued in connection with a survey of the Property obtained on behalf of
Buyer. Buyer shall not be entitled to disapprove liens for current non-delinquent property taxes
or any exception to title created or made through Buyer.
(ii) Disapproval. Should Buyer disapprove any matters
of title, then within fifteen (15) calendar days after Seller's receipt of such First Notice (the
"Second Notice Period"), Seller shall provide notice to Buyer and Escrow Holder whether Seller
is willing or able, in Seller's sole discretion, to attempt to cause such disapproved items to be
eliminated prior to or at Closing (the "Second Notice"); provided, however, that if Seller does
not provide such Second Notice, Seller shall be deemed to have elected not to attempt to remove
the disapproved title exceptions. If the Second Notice states that Seller will attempt to cause
such disapproved title exceptions to be removed from title to the Real Property prior to or at
Closing, then Seller covenants to use commercially reasonable efforts to so remove them. If the
44851143 -7-
Second Notice states that Seller is unable or unwilling to remove such disapproved title
exceptions (or if Seller fails to send the Second Notice), then within fifteen (15) calendar days
after (a) receipt of such Second Notice, or (b) expiration of the Second Notice Period if Seller
fails to send the Second Notice, Buyer shall provide a notice to Seller and Escrow Holder stating
whether Buyer will waive, in Buyer's sole discretion, Seller's inability or unwillingness to
remove all the specified disapproved title exceptions from title to the Real Property (the "Third
Notice"); provided, however, Buyer's failure to give such Third Notice shall be deemed to be a
refusal to waive Buyer's disapproval of the title exceptions. If Buyer's Third Notice specifies
that Buyer waives prior disapprovals except as to those matters Seller has eliminated or will
eliminate prior to or at the Closing, the condition contained in this Paragraph 2.9.4 shall be
deemed satisfied, so long as any disapproved title exceptions which Seller has agreed to
eliminate prior to or at the Closing have been eliminated prior to or at the Closing. If the Third
Notice specifies that Buyer refuses to waive its prior disapprovals (or if the Third Notice is not
provided), this Agreement and the Escrow shall terminate in accordance with Paragraph 2.12
herein.
2.9.5 Issuance of Title Policy. The Title Company shall have
issued the Title Policy as of the Close of Escrow.
2.9.6 Waiver. The foregoing conditions set forth in
Paragraphs 2.9.1, 2.9.2, 2.9.3, 2.9.4 and 2.9.5 above are for the benefit of Buyer, and may be
waived by Buyer in writing delivered to Seller and Escrow Holder. In satisfying the foregoing
conditions, Buyer and Seller shall each exercise good faith, reasonableness and diligence.
However, decisions authorized to be made in the sole discretion of either Buyer or Seller shall be
final and not subject to review or challenge on any basis.
2.10 Seller's Conditions to Closing. Seller shall not be obligated
to proceed to the Close of Escrow and the Closing shall not occur unless and until, in addition to
all other conditions contained in this Agreement, the following conditions have been satisfied or
waived in writing by Seller:
2.10.1 Easement Agreement. Seller shall have obtained approval
from the Town of Los Gatos, in its capacity as a public agency with jurisdiction over subdivision
matters, of that certain Declaration of Easement (the "Easement Agreement") pursuant to which
an access and utility easement is established across a portion of the Property, for the benefit of
that portion of the Master Parcel to be retained by Seller (the "Verizon Parcel"), which Easement
Agreement shall be acceptable to Seller in its sole discretion and which shall be recorded prior to
or concurrently with the Grant Deed.
2.10.2 Performance of Obligations. At or prior to the Closing
Date, Buyer shall have performed all of Buyer's obligations herein that are to be performed prior
to the Closing.
2.10.3 Waiver. It is hereby understood that the conditions set
forth in Paragraphs 2.10.1 and 2.10.2 above are for the benefit of Seller and may be waived by
Seller in writing delivered to Buyer and Escrow Holder. In satisfying the conditions in this
Paragraph 2. 10, Seller and Buyer shall each exercise good faith, reasonableness, and diligence.
4485114.3 -8-
However, decisions authorized to be made in the sole discretion of either Buyer or Seller shall be
final and not subject to review or challenge on any basis.
2.11 Mutual Condition to Closing. Neither Buyer nor Seller
shall be obligated to proceed to the Close of Escrow and the Closing shall not occur unless and
until, in addition to all other conditions contained in this Agreement, on or before the Closing,
Seller shall have obtained. all necessary governmental approvals to separate the Property from the
Master Parcel so as to permit the sale of the Property, including without limitation the approval
by the Town of Los Gatos of a parcel map and subsequent recordation of the approved parcel
map (collectively, the "Subdivision Approval"), which Subdivision Approval, including any
conditions, shall be satisfactory to Seller in its sole and absolute discretion. Seller shall pay the
cost of processing the Subdivision Approval. Seller currently contemplates that the Subdivision
Approval shall divide the Master Parcel into two lots as shown on the proposed Site Plan
submitted for the Subdivision Approval, which is attached hereto as Exhibit "2.11" (the
"Proposed Site Plan"). Buyer in its capacity as Buyer under this Agreement (and without
limiting its authority as a public agency with jurisdiction over subdivision matters) hereby
approves the configuration shown in the Proposed Site Plan and the Easement Agreement.
Parcel 2 of the Proposed Site Plan is the Property, Parcel 1 of the Proposed Site Plan which shall
be retained by Seller after the Close of Escrow is the Verizon Parcel. From and after the Close
of Escrow, Buyer shall be responsible for complying with all conditions to the Subdivision
Approval affecting the Property, at Buyer's sole cost and expense. Seller shall have sole
discretion to determine whether the Subdivision Approval can be obtained on terms acceptable to
Seller. Seller shall have sole discretion to determine the specific configuration of the
Subdivision Approval, including the exact configuration of the Property and of the Verizon
Parcel; provided that (a) the land area of the Property shall be approximately 1.09 acres, and (b)
the configuration of the Property following the Subdivision Approval shall be generally as
shown on the proposed Site Plan. Buyer shall cooperate with Seller as reasonably requested by
Seller for the purpose of obtaining the Subdivision Approval, provided that upon the election of
Seller, the effectiveness of the Subdivision Approval shall be expressly conditioned upon the
occurrence of the Close of Escrow and shall not be binding upon Seller. The condition set forth
in this paragraph is for the benefit of both Buyer and Seller.
2.12 Termination. Upon any termination of this Agreement and
the Escrow (if applicable) for any reason, including the inability of Seller to obtain the
Subdivision Approval as required under Paragraph 2.11 above and other than either party's
default hereunder, (i) each party shall execute such documents as Escrow Holder may reasonably
require to evidence such termination, (ii) Escrow Holder shall charge its fees and expenses to
both parties equally, (iii) subject to the provisions of Subparagraph (ii) above, Escrow Holder
shall return all documents and funds to the party who deposited them, (iv) Buyer shall return to
Seller all documents delivered to it by Seller relating to the Property, (v) Buyer shall deliver to
Seller the Documents Relating to the Property, as described in Paragraph 11 below, (vi) Seller
shall return to Buyer any portion of the Deposit previously delivered to Seller, and (vii) all
obligations of either party relating to this Agreement and the Property shall terminate.
3. Seller's Representations and Warranties. Seller hereby represents and
warrants to Buyer that, unless otherwise provided, at the date of execution hereof and at and as
of the Closing Date:
4485114.3 -9-
3.1 Corporate Existence and Authority. Seller is a corporation
(i) validly existing and in good standing under the laws of the State of California; and (ii) duly
authorized, qualified and licensed under any and all laws, ordinances, rules, regulations and
requirements of all governmental authorities to do all things required of it under or in connection
with this Agreement. This Agreement and all agreements, instruments and documents herein
provided to be executed or to be caused to be executed by Seller are duly executed by and
binding upon Seller. Each individual executing this Agreement on behalf of Seller represents
and warrants that he or she is duly authorized to execute and deliver this Agreement on Seller's
behalf.
3.2 Non-Foreign Person. Seller is not a "foreign person" within the
meaning of Internal Revenue Code § 1445.
4. Buyer's Representations and Warranties. Buyer hereby represents and
warrants to Seller that at the date of execution hereof and at and as of the Closing Date, Buyer is
a municipal corporation (i) validly existing and in good standing under the laws of the state of its
incorporation and the State of California; and (ii) duly authorized, qualified and licensed under
any and all laws, ordinances, rules, regulations and requirements of all governmental authorities
to do all things required of it under or in connection with this Agreement. This Agreement and
all agreements, instruments and documents herein provided to be executed or to be caused to be
executed by Buyer are duly executed and binding on Buyer. Each individual executing this
Agreement on behalf of Buyer represents and warrants that he or she is duly authorized to
execute and deliver this Agreement on Buyer's behalf
5. Buyer's Examination of the Property. Except as provided in Paragraph 3
of this Agreement, Seller makes no representation or warranty respecting the Property, or any
portion thereof, or otherwise in connection with the transaction contemplated hereby. Without
limiting the generality of the foregoing, Buyer hereby acknowledges and agrees that Buyer will
be purchasing the Property "AS IS" with all faults, without representation, warranty or guarantee
of any kind, either express or implied, including, without limitation, any warranty of condition,
merchantability, habitability or fitness for a particular use or purpose or the value, accuracy of
information, marketability, prospects for future development, use or occupancy, except as
provided in Paragraph 3 above, and more specifically that:
(i) Prior to the Close of Escrow, Buyer will have made
its own independent investigation of the Property and all other aspects of this transaction,
including, without limitation, the financial value of the Property and projected future income and
expenses for the Property, and has relied entirely thereon and on the advice of its independent
consultants (if any) in entering into this Agreement, and not on any information or material
supplied by or on behalf of Seller.
(ii) Prior to the Close of Escrow, Buyer will have
reviewed all instruments, records and documents which Buyer deemed appropriate or advisable
to review in connection with the Property and this transaction, and Buyer will have determined
that the information and data contained therein or evidenced thereby was satisfactory to Buyer.
4485114.3 _10-
(iii) Seller makes no representation or warranty with
respect to the zoning or permitted use of any portion of the Property.
(iv) Prior to the Close of Escrow, Buyer will be fully
satisfied that the Purchase Price is fair and adequate consideration for the Property.
(v) Subject to the conditions, covenants, representations
and warranties of the parties set forth herein, notwithstanding any adverse effect on the
marketability, desirability or value of the Property or any portion thereof which occurs between
the execution of this Agreement and the Closing Date, including, without limitation, any adverse
effect arising from or related to any changes or proposed changes to any governmental laws,
ordinances, statutes, rules or regulations, the transactions contemplated by this Agreement shall
be consummated on the terms and conditions contained herein.
(vi) Buyer acknowledges receipt of that certain Property
Risk Natural Hazard Disclosure Report prepared by , dated
6. Hazardous Material.
6.1 Definition of Hazardous Material. As used herein, the term
"Hazardous Material" means any hazardous or toxic substance, material, or waste which is or
becomes regulated by any local governmental authority, the State of California or the United
States Government. The term "Hazardous Material" includes, without limitation, any material or
substance which is (i) defined as "hazardous waste," "extremely hazardous waste," or "restricted
hazardous waste" under Sections 25115, 25117 or 25122.7, or listed pursuant to Section 25140,
of the California Health and Safety Code, Division 20, Chapter 6.5 (Hazardous Waste Control
Law), (ii) defined as a "hazardous substance" under Section 25316 of the California Health and
Safety Code, Division 20, Chapter 6.8 (Carpenter-Presley-Tanner Hazardous Substance Account
Act), (iii) defined as a "hazardous material," "Hazardous substance," or "hazardous waste" under
Section 25501 of the California Health and Safety Code, Division 20, Chapter 6.95 (Hazardous
Materials Release Response Plans and Inventory), (iv) defined as a "hazardous substance" under
Section 25281 of the California Health and Safety Code, Division 20, Chapter 6.7 (Underground
Storage of Hazardous Substances), (v) petroleum, (vi) asbestos, (vii) listed under Article 9 or
defined as "hazardous" or "extremely hazardous" pursuant to Article 4 of Title 22 of the
California Administrative Code, Division 4.5, Chapter 11, (viii) defined as a "hazardous waste,"
"hazardous substance" or similar term under the Federal Water Pollution Control Act (33 U.S.C.
§ 1317), (ix) defined as a "hazardous waste" pursuant to Section 1004 of the Federal Resource
Conservation and Recovery Act, 42 U.S.C. §6901 et seq. (42 U.S.C. §6903), (x) defined as a
"hazardous substance" pursuant to Section 101 of the Comprehensive Environmental Response,
Compensation and Liability Act, 42 U.S.C. §9601 et seq. (42 U.S.C. §9601), or (xi) which
requires investigation or remediation under any federal, state or local statute, regulation,
ordinance, order, action, policy or common law.
6.2 Presence of Hazardous Material. Buyer acknowledges that the
Property may or may not contain certain Hazardous Materials and that Seller makes no
representation or warranty to Buyer regarding the presence or absence of any Hazardous
Materials on or under the Property. It shall be Buyer's responsibility under this Paragraph 6 to
44851143 - 11 -
examine the Property and to review such reports or other documents it deems necessary to satisfy
itself as to the presence or absence of any such Hazardous Materials.
6.3 Right to Inspect. Prior to the expiration of the Feasibility Period,
Buyer shall have the right, at its cost and expense, to conduct such physical inspections of the
Property as necessary in order to determine the presence or absence of Hazardous Material on or
under the Property. Such inspections by Buyer shall not interfere with the ongoing operations at
the Property, shall be conducted at reasonable times and under reasonable circumstances and
shall be subject to the prior approval of Seller. Buyer shall promptly deliver the results of such
inspections to Seller.
6.4 Cleanup of Hazardous Material. If, prior to the expiration of the
Feasibility Period, either Seller or Buyer determines that a legally unacceptable level, according
to applicable governmental standards, of Hazardous Material exists on or under the Property,
then Buyer may, in Buyer's sole discretion, terminate this Agreement. In such case, Buyer shall
bear its own inspection costs, and the provisions of Paragraph 2.12 shall apply. If Buyer elects
not to so terminate this Agreement, then Seller may, in Seller's sole discretion, either
(1) terminate this Agreement, in which event the provisions of Paragraph 2.12 shall apply, or
(2) commence to remove such Hazardous Material from the Property in which event the Close of
Escrow shall be delayed until following Seller's completion of such removal.
6.5 Buyer's Inspection. If Seller elects to remove such Hazardous
Material pursuant to Paragraph 6.4 above, upon completion of such removal, Seller shall deliver
to Buyer and to Escrow Holder notice stating that such removal has been completed. Within
thirty (30) days following Buyer's receipt of such notice, Buyer shall inspect the Property in
order to determine the presence or absence of Hazardous Material on or under the Property;
provided, however, that Seller shall have the right to reasonably approve Buyer's agent who is to
conduct such inspection. If such inspection reveals that the level of Hazardous Material
remaining on or under the Property is at or less than the allowable level under applicable
governmental rules or regulations, then Buyer shall be obligated to proceed to the Close of
Escrow, and the Close of Escrow shall occur upon the first to occur of (1) the Closing Date, if
such removal of Hazardous Material is completed at such time, or (2) within two (2) weeks
following Buyer's inspection. If Seller commences to remove such Hazardous Material, Seller
shall thereafter diligently proceed with such removal at Seller's sole cost and expense, and in
accordance with all applicable laws, rules, and regulations. If such removal has not been
completed by October 1, 2008 (the "Outside Completion Date"), then Buyer may terminate the
Escrow and this Agreement by notice to Seller and Escrow Holder to be given no later than five
(5) days after the Outside Completion Date, in which event the provisions of Paragraph 2.12
above shall apply
6.6 Indemnification. If the parties proceed to the Close of Escrow,
Buyer shall indemnify, defend and hold Seller harmless from any and all claims, demands
(including demands by any governmental agency), liabilities, costs, expenses, penalties,
damages, losses and liens, including without limitation reasonable attorneys' fees, arising out of
or with respect to (1) Hazardous Material on or under the Property, or migrating to or from the
Property at the Close of Escrow or released on or under the Property subsequent thereto, and
(2) any clean-up of any and all Hazardous Material which might remain or subsequently be
4485114.3 - 12-
placed on or under the Property. The indemnity provided for herein shall survive the Close of
Escrow hereunder and shall not be merged into the Grant Deed.
6.7 Release. If the parties proceed to the Close of Escrow, then:
6.7.1 Buyer and its employees, contractors, agents, and each of
them, and its successors, assigns, heirs, devisees and executors, agree to forever release,
discharge and acquit Seller and its parent, subsidiary and/or affiliate corporations, partnerships
(general and limited), partners, directors, officers, shareholders, and employees, and each of
them (collectively, "Releasees"), of and from any and all claims, demands, obligations,
liabilities, indebtedness, breaches of duty of any relationship, acts, omissions, misfeasance,
malfeasance, cause or causes of action, costs, sums of money, accounts, compensations,
contracts, controversies, promises, damages, costs, losses and expenses, of every type, kind,
nature, description or character (including without limitation reasonable attorneys' fees)
(collectively "Claims"), and irrespective of how, why or by reason of what facts, whether
heretofore or now existing, or which could, might or may be claimed to exist in the future,
whether known or unknown, suspected or unsuspected, liquidated or unliquidated, each as if
fully set forth herein at length, which in any way arise out of, or are connected with or relate to
(1) any Hazardous Material on or under the Property, or migrating to or from the Property, at the
Close of Escrow or released on or under the Property subsequent thereto, and (2) any required
clean-up of any and all Hazardous Material which might remain or subsequently be placed on or
under the Property, including without limitation any personal injuries suffered by any person or
persons. The release provided for herein shall survive the Close of Escrow hereunder and shall
not be merged into the Grant Deed.
6.7.2 Buyer and its successors, assigns, heirs, devisees and
executors, agrees, represents and warrants that the matters released in Paragraph 6.7.1 hereof are
not limited to matters which are known or disclosed, and hereby waives any and all rights and
benefits which it now has, or in the future may have, conferred upon it by virtue of the provisions
of Section 1542 of the Civil Code of the State of California which provides as follows:
"A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS
WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT
TO EXIST IN HIS OR HER FAVOR AT THE TIME OF
EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM
OR HER MUST HAVE MATERIALLY AFFECTED HIS OR
HER SETTLEMENT WITH THE DEBTOR."
Buyer's Initials
Buyer also further expressly waives and relinquishes all statutes, rights, remedies and benefits of
all other jurisdictions, state and federal, which are all of the same or similar import or effect as
Section 1542 of the California Civil Code.
Buyer's Initials
44851143 - 13-
In connection with the release contained in Paragraph 6.7.1, Buyer agrees,
represents and warrants that it realizes and acknowledges that factual matters now unknown to it
may have given or may hereafter give rise to Claims which are presently unknown, unanticipated
and unsuspected, and further agrees, represents and warrants that the release contained in
Paragraph 6.7.1 has been negotiated and agreed upon in light of that realization and that it
nevertheless hereby intends to release, discharge and acquit Seller and Releasees from any such
unknown Claims to the extent provided herein.
6.7.3 Buyer hereby agrees, represents and warrants that it has had
advice of counsel of its own choosing in negotiations for and the preparation of this Agreement
(including, without limitation, Paragraphs 6.7.1 and 6.7.2 herein), that it has read Paragraph 6.7.1
hereof and Paragraph 6.7.2, that it has had such Paragraphs fully explained by such counsel, and
that it is fully aware of their contents and legal effect.
6.7.4 Buyer acknowledges and agrees that no employee, agent,
legal counsel, or other representative of Seller, including Seller's Broker (as defined below) has
been authorized to make, and in executing this Agreement Buyer has not relied upon, any
statement of Seller, Seller's employees, agents, Seller's Broker, or legal counsel, and should
Buyer be mistaken in its belief with regard to some issue of fact or law regarding the matters
herein released, it specifically agrees to assume the risk of such mistake, if any exists. Buyer
hereby acknowledges that Buyer is capable of performing or causing to be performed a thorough
and independent investigation, analysis and evaluation of the Property and all other aspects of
the transaction contemplated by this Agreement, and that it has had an opportunity to make, and
to have its experts make its and their investigation regarding the matters herein released and all
laws, rules and regulations related thereto.
7. Removal of Personal Property. Prior to the Close of Escrow, Seller shall
remove from the Property any items of personal property owned by Seller. Such removal shall
not affect the amount of the Purchase Price or any other terms or conditions of this Agreement.
8. Entry.
8.1 Right of Entry. Buyer and its representatives, employees,
contractors, agents and designees shall have the right to enter upon the Property, at Buyer's sole
cost and expense, in order to inspect and investigate the Property and to conduct any and all
surveys, tests and studies Buyer deems necessary or convenient, provided that Buyer shall
immediately restore any damage done to the Property as the result of any such tests, surveys or
studies. Prior to any entry upon the Property, Buyer shall designate in writing to Seller one or
more representatives of Buyer who shall accompany any of such persons each time they enter
upon the Property. Such entry or review shall be made only after reasonable advance written
notice to Seller by Buyer (in no event less than 24 hours advance notice) and at times reasonably
acceptable to Seller. Buyer shall indemnify and defend Seller against and hold Seller and the
Property free and harmless from any and all claims, demands, liabilities, costs, expenses,
penalties, damages, losses and liens, including without limitation, reasonable attorneys' fees,
arising out of any such entry by Buyer or its representatives, employees, agents, contractors or
designees. The indemnity provided for herein shall survive the termination of this Agreement or
the Close of Escrow hereunder and shall not be merged into the Grant Deed. The inspections of
4485114.3 -14-
the Property shall be subject to the terms of this Paragraph 8 and shall be considered entries upon
the Property for the purposes of this Paragraph 8.
8.2 Insurance. Commencing with Buyer's execution of this
Agreement and at all times prior to the Close of Escrow, Buyer shall have in effect worker's
compensation and employer's liability insurance with statutory limits of coverage as required by
law, and with a limit of liability of at least $1,000,000/$2,000,000 each occurrence/aggregate,
and commercial general liability insurance naming Seller as an additional insured, with limits of
not less than $1,000,000 each occurrence, with $2,000,000 aggregate for bodily injury, including
death resulting therefrom, and broad form property damage, including collapse and underground
property damage, and (b) waiver of subrogation. Prior to entering the Property, Buyer shall
deliver to Seller certificates of insurance evidencing such coverage and further evidencing that
such coverage may only be terminated or modified upon thirty (30) day's prior written notice to
Seller. These covenants in this Paragraph 8 shall survive the Close of Escrow and shall not be
merged into the Grant Deed.
9. Condemnation; Damage and Destruction.
9.1 Condemnation. This Agreement is subject to the provisions of
California Civil Code Sections 1662 (the "Statute"). For the purposes of the Statute, a taking by
eminent domain of a portion of the Property shall be deemed to affect a "material part" if the
taking exceeds ten percent (10%) of the gross land area of the Land. It is hereby understood that
in the event of a taking of a "material part" of the Property, then Buyer shall not be obligated to
proceed to the Close of Escrow hereunder. In the event of such a condemnation of less than a
"material part," Buyer and Seller shall, nonetheless, proceed to Closing without reduction or
abatement of the Purchase Price, but Seller shall assign to Buyer all of Seller's right to recover
from the condemning authority at the Close of Escrow. Seller agrees that it will, both before and
after the Closing Date, execute such documents or instruments and further assurances as Buyer
may reasonably request in order to facilitate such recovery by Buyer and Seller will cooperate in
any manner reasonably requested by Buyer. Any such assignment shall be without
representation or warranty by Seller.
9.2 Damage and Destruction. For the purposes of the Statute, damage
or destruction to the Property shall be deemed to affect a "material part" if the cost to repair such
damage (as reasonably determined by Seller) exceeds $500,000. In the event of such damage
affecting less than a material part of the Property, Buyer and Seller shall, nonetheless proceed to
Closing without abatement of the Purchase Price, but Seller shall assign to Buyer proceeds from
any casualty insurance received by Seller on account of any such damage which has not been
remedied or repaired by Seller prior to the Closing Date. Seller agrees that it will both before
and after the Closing Date execute such documents or instruments and further assurances as
Buyer may reasonably request in order to facilitate such recovery by Buyer and Seller will
cooperate in any manner reasonably requested by Buyer. Any such assignment shall be without
representation or warranty by Seller.
10. Delivery of Possession. Subject to the rights of all tenants on the
Property, if any, Seller shall deliver possession of the Property to Buyer at the Close of Escrow.
4485114.3 - 15-
11. Delivery of Documents Relating to the Property. Within ten (10) days
after the termination of this Agreement and the Escrow (if applicable) for whatever reason,
Buyer shall deliver to Seller, without warranty and to the extent assignable by Buyer, at no cost
to Seller, (a) all technical data prepared or obtained by Buyer, its agents or contractors in
connection with the Property,. including, but not limited to, land plans, maps, engineering studies,
soils studies, geological studies and other engineering information in Buyer's possession or
under Buyer's control, (b) all written documentation prepared or obtained by Buyer or filed with
the applicable governmental authority in connection with the Zoning Approvals, including
without limitation, applications, plans and specifications and environmental reports, and (c) all
other written information relating to the Property in any manner whatsoever that is in Buyer's
possession or under Buyer's control, including without limitation, appraisals, drawings and
sketches, memoranda, construction documents, reports, studies and other technical or business
information ((a), (b), and (c) are collectively referred to herein as, "Documents Relating to the
Property"). Notwithstanding the foregoing, Documents Relating to the Property shall not include
Buyer's proprietary information relating to Buyer's potential use of the Property, including
architectural studies and evaluations. All Documents Relating to the Property shall be the
property of Seller; provided, however, that Buyer hereby confirms to Seller that all Documents
Relating to the Property prepared by Buyer's independent consultants are assignable to Seller.
Buyer shall keep and shall require its agents to keep all such information confidential both prior
to and after any termination of this Agreement. Notwithstanding anything to the contrary
contained in this Agreement, if this Agreement is terminated in accordance with Paragraph 2.12
above, Seller shall not be required to deliver any portion of the Deposit previously delivered to
Seller or any other funds to which Buyer is entitled and Escrow Holder is irrevocably authorized
and instructed not to deliver the Deposit or any other funds to which Buyer is entitled until Buyer
has complied with the obligations set forth in this Paragraph 11.
12. Commissions. Buyer and Seller represent and warrant to one another that
no broker, salesman or finder has been engaged by them in connection with the transactions
contemplated by this Agreement other than CB Richard Ellis, Inc. representing Seller ("Seller's
Broker"), and CPS CORFAC International representing Buyer ("Buyer's Broker"). Seller shall
pay Seller's Broker through Escrow a commission upon the Close of Escrow pursuant to a
separate agreement between Seller and Seller's Broker. Seller's Broker shall pay to Buyer's
Broker upon the Close of Escrow a commission pursuant to a separate agreement between
Buyer's Broker and Seller's Broker. In the event of a claim for brokers' or finders' fees or
commissions in connection with the negotiation or execution of this Agreement or the
transactions contemplated hereby, Seller shall indemnify, hold harmless and defend Buyer from
and against such claim if it shall be based upon any statement, representation, or agreement
alleged to have been made by Seller (including any claim asserted by Seller's Broker), and Buyer
shall indemnify, hold harmless and defend Seller if such claim shall be based upon any
statement, representation, or agreement alleged to have been made by Buyer (excluding any
claim asserted by Seller's Broker).
13. LIQUIDATED DAMAGES.
13.1 BUYER'S DEFAULT. NOTWITHSTANDING ANY OTHER
PROVISION HEREIN CONTAINED, IF THE SALE OF THE PROPERTY IS NOT
CONSUMMATED BY REASON OF ANY DEFAULT BY BUYER, THEN SELLER SHALL
4485114.3 - 16 -
BE ENTITLED TO LIQUIDATED DAMAGES FROM BUYER IN THE AMOUNT OF THE
DEPOSIT ($100,000). BUYER AND SELLER HEREBY ACKNOWLEDGE THAT
SELLER'S DAMAGES WHICH WOULD RESULT FROM BUYER'S FAILURE TO
ACQUIRE THE PROPERTY FOR ANY REASON ARE IMPRACTICABLE, AND
EXTREMELY DIFFICULT TO ASCERTAIN, AND THE AMOUNT OF THE DEPOSIT IS A
REASONABLE ESTIMATE OF SUCH DAMAGES. THE PAYMENT OF SUCH AMOUNT
AS LIQUIDATED DAMAGES FOR THE BREACH OF BUYER'S OBLIGATION TO
PURCHASE THE PROPERTY UNDER THIS AGREEMENT IS NOT INTENDED AS A
FORFEITURE OR PENALTY WITHIN THE MEANING OF CALIFORNIA CIVIL CODE
SECTIONS 3275 OR 3369, BUT IS INTENDED TO CONSTITUTE LIQUIDATED
DAMAGES TO SELLER PURSUANT TO CALIFORNIA CIVIL CODE SECTIONS 1671,
1676 AND 1677. THE PARTIES HAVE SET FORTH THEIR INITIALS BELOW TO
INDICATE THEIR AGREEMENT WITH THE LIQUIDATED DAMAGES PROVISION
CONTAINED IN THIS PARAGRAPH. NOTWITHSTANDING ANYTHING TO THE
CONTRARY CONTAINED HEREIN, THE PROVISIONS OF THIS PARAGRAPH ARE NOT
INTENDED AND SHALL NOT BE CONSTRUED TO LIMIT OR NEGATE BUYER'S
INDEMNIFICATION OBLIGATIONS AS SET FORTH ELSEWHERE IN THIS
AGREEMENT.
Seller's Initials
Buyer's Initials
13.2 SELLER'S DEFAULT. NOTWITHSTANDING ANY OTHER
PROVISION HEREIN CONTAINED, IF THE SALE OF THE PROPERTY IS NOT
CONSUMMATED BY REASON OF ANY DEFAULT BY SELLER, THEN BUYER SHALL
BE ENTITLED, AS ITS SOLE AND EXCLUSIVE REMEDY, WHETHER AT LAW OR IN
EQUITY, EITHER (A) TO TERMINATE THIS AGREEMENT AND RECOVER ITS
DEPOSIT AND ITS ACTUAL, REASONABLE, OUT-OF-POCKET EXPENSES INCURRED
IN CONDUCTING ITS DUE DILIGENCE INVESTIGATION OF THE PROPERTY IN AN
AMOUNT NOT TO EXCEED ONE HUNDRED THOUSAND DOLLARS ($100,000) (THE
"DUE DILIGENCE REIMBURSEMENT"), OR (B) IN LIEU OF TERMINATING THE
AGREEMENT AND RECOVERING ITS DEPOSIT AND THE DUE DILIGENCE
REIMBURSEMENT, BUYER SHALL BE ENTITLED TO PURSUE SPECIFIC
PERFORMANCE OF THIS AGREEMENT WITHOUT RIGHT TO ANY DAMAGES
(OTHER THAN A RETURN OF THE DEPOSIT AND THE DUE DILIGENCE
REIMBURSEMENT IF SPECIFIC PERFORMANCE IS NOT GRANTED) OR OTHER
EQUITABLE RELIEF WHATSOEVER, BUT ONLY IF BUYER FILES SUCH SPECIFIC
PERFORMANCE ACTION THIRTY (30) DAYS AFTER THE SCHEDULED CLOSING
DATE, AND BUYER'S FAILURE TO INITIATE SUCH ACTION WITHIN SUCH
THIRTY (30) DAY PERIOD CONSTITUTES AN ABSOLUTE BAR FROM BUYER'S
INSTITUTION OF ANY SUCH PROCEEDINGS. BUYER SHALL NOT BE ENTITLED TO
RECORD A LIEN OR LIS PENDENS AGAINST THE PROPERTY OTHER THAN IN
CONNECTION AND CONCURRENTLY WITH THE FILING OF SUCH SPECIFIC
PERFORMANCE ACTION.
4485114.3 - 17 -
Seller's Initials
Buyer's Initials
14. Attorneys' Fees. If any action or proceeding shall be brought by either
party in order to enforce the provisions of this Agreement, or to collect damages as a result of the
breach of any of the provisions of this Agreement, whether or not such action or proceeding is
pursued to a judgment, the prevailing party shall be entitled to recover all reasonable attorneys'
fees incurred in connection therewith, including costs.
15. Notices. Whenever Escrow Holder or any party hereto shall desire to
deliver to the other any notice, demand, request or other communication, each such notice,
demand, request or other communication shall be in writing, shall be given by personal delivery,
by registered or certified United States mail, return receipt requested, or by overnight courier,
postage prepaid, or by facsimile, addressed as follows:
TO SELLER: VERIZON CALIFORNIA INC.
c/o Verizon Corporate Real Estate
112 S. Lakeview Canyon Rd. (CA501CW)
Thousand Oaks, CA 913,62
Attention: James Tousignant, Manager
Real Estate Services
Fax No. 805-379-1454
WITH COPIES TO: McGuireWoods LLP
1800 Century Park East, Stn Floor
Los Angeles, CA 90067
Attention: Joan A. Wolff, Esq.
Fax No. 310-315-8210
TO BUYER:
CB Richard Ellis, Inc.
c/o Verizon Corporate Real Estate
112 S. Lakeview Canyon Rd. (CA501CW)
Thousand Oaks, CA 91362
Attention: Karalyn Lucci
Fax No. 805-379-1454
Town of Los Gatos
Attention:
Fax No.
TO ESCROW HOLDER: Fidelity National Title
801 S. Figueroa Street, Suite 870
Los Angeles, CA 90017
Attention: Julia Davis, Escrow Officer
Fax No. 213-689-9330
4485114.3 - 18-
Any such notice, demand, request or other communication shall be deemed effective on the day
of actual delivery or refusal to accept as shown by the addressee's return receipt or fax
confirmation. If the date on which any notice required to be delivered hereunder falls on a
weekend or legal holiday, then such notice may be delivered on the next business day
immediately following such weekend or holiday. If the date of Closing, or any other date, such
as the expiration of the Feasibility Period fall on a weekend or legal holiday, then such date shall
automatically be extended to the next business day immediately following such weekend or
holiday. The foregoing addresses may be changed by notice given in accordance with this
Paragraph 15.
16. Amendment; Complete Agreement. All amendments and supplements to
this Agreement must be in writing and executed by Buyer and Seller. All understandings and
agreements between the parties (including any printed offer of sale provided by Seller to Buyer)
regarding the Property are merged in this Agreement, which alone fully and completely
expresses the agreement of the parties regarding the Property. This Agreement has been entered
into after full investigation of the facts by both parties and neither party has relied on any
statement or representation not embodied in this document. This Agreement has been drafted
through a joint effort of the parties and their counsel and therefore shall not be construed against
either of the parties as the draftsperson.
17. Governing Law. This Agreement shall be governed under the laws of the
State of California. Venue for any legal action concerning this Agreement shall be in the Santa
Clara Superior Court.
18. Counterparts, Headings and Defined Terms. This Agreement may be
executed in several counterparts each of which shall be an original, but all of such counterparts
shall constitute one such Agreement. The headings used herein are for convenience only and are
not to be construed to be part of this Agreement. For the purposes of this Agreement, (a) the
term "including" means "including without limitation," and (b) when a time period is specified
in this Agreement for the performance of an act or the occurrence of an event, "days" shall mean
"calendar days," unless otherwise specified herein.
19. No Offer. Submission of this Agreement for examination or signature by
Buyer is not effective as an agreement to sell the Property or otherwise until execution by and
delivery to both Buyer and Seller of an original of this Agreement.
20. Time of the Essence. Time is of the essence of this Agreement.
21. Waiver. The waiver by one party of performance of any covenant,
condition or promise shall not invalidate this Agreement, nor shall it be considered to be a
waiver by it of any other covenant, condition or promise. The waiver by either or both parties of
the time for performing any act shall not constitute a waiver of the time for performing any other
act or an identical act required to be performed at a later time. Except as specifically provided in
Paragraph 13 above, the exercise of any remedy provided in this Agreement shall not be a waiver
of any other remedy provided by law.
4485114.3 - 19-
22. Third Parties. Nothing contained in this Agreement, expressed or implied,
is intended to confer upon any person, other than the parties hereto and their successors and
assigns, any rights or remedies under or by reason of this Agreement.
23. Severability. If any one or more of the provisions contained in this
Agreement shall for any reason be held to be invalid, illegal or unenforceable in any respect,
such invalidity, illegality or unenforceability shall not affect any other provision hereof and this
Agreement shall be construed as if such invalid, illegal or unenforceable provision had never
been contained herein, unless such invalidity, illegality or unenforceability materially affects the
transactions contemplated by this Agreement or the ability of either party to perform its
obligations under this Agreement. In such case, either party may terminate this Agreement and
the Escrow on written notice to the other party given no later than ten (10) business days after the
party giving such notice becomes aware of such invalidity, illegality or unenforceability, and the
provisions of Paragraph 2.12 above shall apply.
24. Tax-Deferred Exchange. Each party shall reasonably cooperate with the
other if such other party elects to either acquire the Property or convey the Property in
connection with a tax-deferred exchange within the meaning of Section 1031 of the Internal
Revenue Code of 1986, as amended, provided that (a) either party's election to effect a tax-
deferred exchange shall not create any additional conditions to the Close of Escrow or extend the
Closing Date; and (b) Seller shall not be obligated in any event to take or receive title to any
other real property in connection with such exchange. Any such exchange shall be accomplished
by supplemental instructions, exchange documents and an exchange accommodator, if any,
reasonably acceptable to both parties. The party electing to enter into a tax-deferred exchange
shall indemnify and hold the other party harmless from and against any and all liens, claims,
damages, liabilities, losses, costs and expenses, including reasonable attorneys' fees, arising out
of or relating to the cooperating party's participation in the tax-deferred exchange contemplated
by this Paragraph. The Close of Escrow shall not be conditioned on the closing of any proposed
tax-deferred exchange, and if such proposed tax-deferred exchange is not in a position to close
concurrently with the Close of Escrow, Buyer shall nevertheless be obligated to complete the
purchase of the Property from Seller on the Closing Date on the terms and conditions of this
Agreement.
25. Additional Documents. Each party hereto agrees to perform any further
acts and to execute and deliver any further documents which may be reasonably necessary to
carry out the provisions of this Agreement.
26. Assignment; Binding Effect. This Agreement shall not be assignable by
Buyer to any other party without the prior written consent of Seller, which consent Seller may
withhold in its sole discretion. For purposes of this Paragraph, any agreement entered into
between Buyer and a third party prior to the Close of Escrow to sell or otherwise transfer any
interest in the Property, including, without limitation, the execution of escrow instructions
contemplating such a sale or transfer shall be deemed an assignment. Any such assignment
without Seller's consent as provided herein, shall be deemed a material breach of this
Agreement, and Seller, may, in Seller's sole discretion, elect to terminate this Agreement, in
which case this Agreement shall be null and void, Buyer shall have no further rights hereunder,
and Seller shall be entitled to damages as provided in Paragraph 13. Subject to the foregoing,
4485114.3 -20-
this Agreement shall be binding upon the heirs, executors, administrators, successors and assigns
of Seller and Buyer.
27. Waiver of Trial by Jury. SELLER AND BUYER KNOWINGLY,
VOLUNTARILY AND INTENTIONALLY WAIVE (TO THE EXTENT PERMITTED BY
APPLICABLE LAW) ANY RIGHT THEY MAY HAVE TO A TRIAL BY JURY OF ANY
DISPUTE ARISING UNDER OR RELATING TO THIS AGREEMENT, AND THE PARTIES
AGREE THAT ANY SUCH DISPUTE SHALL BE TRIED BEFORE A JUDGE SITTING
WITHOUT A JURY.
28. Independent Counsel. Each party acknowledges that it has consulted with
and had the opportunity to consult with independent counsel of its own choosing in connection
with the negotiation and execution of this Agreement.
29. Patriot Act.
29.1 Seller shall take any actions that may be required to comply with
the terms of the USA Patriot Act of 2001, as amended, any regulations promulgated under the
foregoing law, Executive Order No. 13224 on Terrorist Financing, any sanctions program
administrated by the U.S. Department of Treasury's Office of Foreign Asset Control or Financial
Crimes Enforcement Network, or any other laws, regulations, executive orders or government
programs designed to combat terrorism or money laundering, or the effect of any of the
foregoing laws, regulations, orders or programs, if applicable, on the transactions described in
this Agreement. Seller is not an entity named on the List of Specially Designated Nationals and
Blocked Persons maintained by the U.S. Department of Treasury, as last updated prior to the date
of this Agreement.
29.2 Buyer shall take any actions that may be required to comply with
the terms of the USA Patriot Act of 2001, as amended, any regulations promulgated under the
foregoing law, Executive Order No. 13224 on Terrorist Financing, any sanctions program
administrated by the U.S. Department of Treasury's Office of Foreign Asset Control or Financial
Crimes Enforcement Network, or any other laws, regulations, executive orders or government
programs designed to combat terrorism or money laundering, or the effect of any of the
foregoing laws, regulations, orders or programs, if applicable, on the transactions described in
this Agreement. Buyer is not an entity named on the List of Specially Designated Nationals and
Blocked Persons maintained by the U.S. Department of Treasury, as last updated prior to the date
of this Agreement.
30. Backup Offer. Until the Closing, Seller may consider back-up offers for a
portion or all of the Property.
31. Limitation of Liability. Buyer acknowledges and agrees that neither the
shareholders, officers, employees nor affiliates of Seller shall be liable for obligations entered
into by or on behalf of Seller. Seller shall not be liable for any indirect, incidental, speculative,
punitive, special, or consequential damages of any kind including, but not limited to, loss of
revenue, loss of goodwill, loss of business opportunity, loss of profits, losses related to third
party claims or any one or more of them arising in any manner from this Agreement or the
4485114.3 -21 -
performance or nonperformance of obligations related thereto regardless of the foreseeability
thereof. Notwithstanding anything to the contrary set forth in Paragraph 13.2 above, if prior to
the Closing Date Buyer becomes aware of any existing or new item, fact or circumstance which
renders a representation or warranty of Seller set forth herein incorrect or untrue in any material
respect (collectively, the "Representation Matter") or that has a material, adverse impact on the
value of the Property, then provided such representation or warranty was true when made by
Seller Buyer's sole remedy shall be the right to terminate this Agreement and obtain a refund of
the Deposit by providing written notice thereof to Seller no later than seven (7) business days
after Buyer learns of such Representation Matter. If Buyer does not timely terminate this
Agreement, then Seller's representations and warranties shall be automatically limited to account
for the Representation Matter, Buyer shall be deemed to have waived Buyer's right to pursue any
remedy for breach of the representation or warranty made untrue on account of such
Representation Matter, and the parties shall proceed to the Close of Escrow. Notwithstanding
anything to the contrary contained in this Agreement, Buyer hereby agrees that Seller's
maximum liability under this Agreement for actual, direct damages shall not exceed $50,000 in
the aggregate and that any action or claim asserted by Buyer against Seller must be filed (if at
all) within twelve (12) months following the Closing, and Buyer hereby waives any right to bring
any such claim or action thereafter. The provisions of this Paragraph 31 shall survive the
Closing and shall not merge with the Grant Deed.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first above written.
SFT J FR
VERIZON CALIFORNIA INC., a California
corporation
B y:
Title:
BUYER:
TOWN OF LOS GATOS, a municipal
corporation
APPROVED AS TO FORM: By:
By:
Title:
Orry P. Korb, Town Attorney By:
Title:
ATTEST:
4485114.3 -22-
Jackie Rose, Clerk Administrator
4485114.3 -23-
Receipt of the foregoing instructions by Escrow Holder is acknowledged, said
escrow holding is accepted and Escrow Holder agrees to hold and dispose of the funds and
documents deposited in the escrow in accordance with these instructions.
Dated: '2007.
4485114.3
Fidelity National Title
By:
-24-
Julia Davis, Escrow Officer
M
■
AGREEMENT OF PURCHASE AND SALE
AND ESCROW INSTRUCTIONS
LIST OF EXHIBITS
Exhibit ° 1. F Legal Description of Property
Exhibit "2.1" Escrow Holder's Standard Provisions
Exhibit "2.3" Grant Deed
Exhibit "2.11 " Proposed Site Plan
4485114.3 -25-
AGREEMENT OF PURCHASE AND SALE
AND ESCROW INSTRUCTIONS
EXHIBIT "1.1"
LEGAL DESCRIPTION OF THE PROPERTY
[to be attached]
4485114.3 Exhibit 1.1 - 1
AGREEMENT OF PURCHASE AND SALE
AND ESCROW INSTRUCTIONS
EXHIBIT "2.1"
ESCROW HOLDER'S STANDARD PROVISIONS
TO: FIDELITY NATIONAL TITLE
1. Time is of the essence of these instructions. If this escrow is not in a
condition to close by the CLOSING DATE as provided for in the foregoing Purchase Agreement
and written demand for cancellation is received by you from any principal to this escrow after
said date, you shall act in accordance with Paragraph 7 of these General Provisions. If no
conflicting instruction or demand for cancellation is made, you will proceed to close this escrow
when the principals have complied with the escrow instructions. In the event one or more of the
General Provisions are held to be invalid, those remaining will continue to be operative. Any
amendments of or supplements to any instructions affecting escrow must be in writing. You are
authorized, prior to the close of escrow, to pay from funds on deposit any fees necessary to
obtain any demand and/or report as may be required in this escrow and at the close of escrow
charge the parties as appropriate. The principals will hand you any funds and instruments
required from each respectively to complete this escrow. Interest on any new financing may
begin to accrue on the date loan funds/proceeds are disbursed by the new lender, and borrower
agrees to pay same in accordance with lender's instructions.
2. You are instructed to deliver and/or record all documents and disburse all
funds when you can comply with these instructions and issue any title insurance policy as called
for herein. These instructions, together with any amendments and/or supplements, may be
executed in counterparts and together shall constitute one and the same document. If these
instructions relate to a sale, and if there is no other written agreement between the parties
pertaining thereto, buyer agrees to buy and seller agrees to sell upon the terms and conditions
hereof. All documents, balances and statements due the undersigned are to be mailed to the
respective addresses shown herein, unless otherwise directed. In the event that any party to this
escrow utilizes facsimile transmitted signed documents, all parties hereby agree to accept and
hereby instruct the escrow holder to rely upon such documents as if they bore original signatures.
Buyer and seller further acknowledge that any documents to be recorded bearing non original
(facsimile) signatures will not be accepted for recording by the county recorder.
3. The phrase "close of escrow" (or COE) as used in this escrow means the
date on which documents are recorded, unless otherwise specified.
4. Assume a 30 day month in any proration herein provided, and unless
otherwise instructed, you are to use the information contained in the latest available tax
statement, including any supplemental taxes of record, rental statement as provided by seller and
beneficiary's or association-statements delivered into escrow for proration purposes.
4485114.3 Exhibit 2.1 - I
I
5. Upon close of escrow you are instructed to charge our respective accounts
the costs attributable to each, including but not limited to costs as provided for herein and/or in
accordance with our respective estimated statements attached hereto and made a part hereof.
6. Recordation of any instruments delivered through this escrow, if necessary
or proper for the issuance of the policy of title insurance called for, is authorized. No
examination or insurance as to the amount or payment of personal property taxes is required
unless specifically requested.
7. If demand to cancel is submitted after the Closing Date, any principal so
requesting you to cancel this escrow shall file notice of demand to cancel in your office in
writing. You shall within three (3) working days thereafter mail by certified mail one copy of
such notice to each of the other principals at the address stated in this escrow. Unless written
objection thereto is filed in your office by a principal within fifteen (15) calendar days after the
date of such mailing, you are instructed to cancel this escrow. If this is a sale escrow, you may
return the lender's papers and/or funds upon lender's demand.
8. In the event that this escrow is canceled, any fees or charges due Fidelity
National Title including cancellation fees and any expenditures incurred or authorized shall be
paid from funds on deposit unless otherwise specifically agreed to or determined by a court of
competent jurisdiction. Upon payment thereof, return documents and monies to the parties as set
forth in the foregoing Purchase Agreement, or as ordered by the court, and void any executed
instruments.
9. If there is no written activity by a principal to this escrow within any six-
month period after the Closing Date set forth in the Purchase Agreement, Fidelity National Title
may, at its option, terminate its agency obligation and cancel this escrow, returning all
documents, monies or other items held, to the respective parties entitled thereto, less any fees and
charges as provided herein.
10. If for any reason, funds are retained or remain in escrow after the closing
date, you may deduct therefrom a reasonable charge as custodian, of not less then $25.00 per
month, unless otherwise specified.
11. In the event that you should receive written conflicting demands or claims
with respect to this escrow, or with respect to the rights of any of the parties hereto, or with
respect to any money or property deposited herein, you shall have the absolute right at your
option to discontinue any or all further acts until such conflict is resolved to your satisfaction,
including by means of filing an action in interpleader if agreement is not reached within a
reasonable time.
12. In the event that any Offer to Purchase, Deposit Receipt, or any other form
of Purchase Agreement (collectively, the "Purchase Agreement") is deposited in this escrow, if
there is a conflict between the terms of these General Provisions and the Purchase Agreement,
the terms of the Purchase Agreement shall control.
13. The parties hereto, by execution of these instructions acknowledge that
the escrow holder assumes no responsibility or liability whatsoever for the supervision of any act
4485114.3 Exhibit 2.1 - 2
or the performance of any condition which is a condition subsequent to the closing of this
escrow.
14. In the absence of instructions to the contrary, you are hereby authorized to
utilize wire services, overnight next day, or other expedited delivery services (as opposed to the
regular U.S. Mail) and to charge the respective party's account accordingly.
15. Concerning any real property involved in this transaction you are released
from and shall have no liability, obligation or responsibility with respect to (a) withholding of
funds pursuant to Section 1445 of the Internal Revenue Code of 1986 as amended, and to
Sections 18662 and 18668 of the California Revenue and Taxation Code, (b) advising the parties
as to the requirements of said Section 1445, (c) determining whether the transferor is a foreign
person or a nonresident under such Section, nor (d) obtaining a non foreign affidavit or other
exemption from withholding under said Sections nor otherwise making any inquiry concerning
compliance with such Sections by any party to the transaction.
16. If you pay a demand to pay in full a revolving line of credit or equityline
loan, you are hereby instructed on my behalf and for my benefit, to request that the lender
issuing said demand cancel said revolving line or equityline of credit.
17. You are authorized to furnish to any affiliate of Fidelity National Title,
any attorney, broker or lender identified with this transaction or any one acting on behalf of such
lender any information, instructions, amendments, statements, or notices of cancellation given in
connection with this escrow. If any check submitted to escrow is dishonored when presented for
payment, you are authorized to notify all principals and/or their respective agents of such non
payment.
18. All notices, change of instructions, communications and documents are to
be delivered in writing to the office of Fidelity National Title, as set forth herein.
19. All funds received in this escrow shall be deposited with other escrow
funds in one or more non-interest bearing demand accounts of Fidelity National Title in any state
or federal bank or any state or federal savings and loan association ("the depository institutions")
and may be transferred to any other such accounts.
The parties to this escrow acknowledge that while these accounts do not bear interest,
because of these and other banking relationships with the depository institutions, Fidelity
National Title and its affiliates may receive from some of the depository institutions an
array of banking services, accommodations or other benefits. Fidelity National Title and
its affiliates also may elect to enter into other business transactions with or obtain loans
for investment or other purposes from some of the depository institutions. All of such
services, accommodations and other benefits shall accrue, directly or indirectly, to
Fidelity National Title and its affiliates and they shall have no obligation to account to the
parties to this escrow for the value of such services, accommodations or other benefits.
All disbursements shall be made by Fidelity National Title check, unless otherwise
instructed.
44851143 Exhibit 2.1 - 3
Fidelity National Title shall not be responsible for any delay in closing if funds received
by escrow are not available for immediate withdrawal. Fidelity National Title may, at its
option, require concurrent instructions from all principals prior to release of any funds on
deposit in this escrow.
20. You are authorized to destroy or otherwise dispose of any and all
documents, papers, instructions, correspondence and other material pertaining to this escrow at
the expiration of six (6) years from the close of escrow or cancellation thereof, without liability
and without further notice.
IMPORTANT NOTICE
Except for wire transfers, funds remitted to this escrow are subject to availability
requirements imposed by Section 12413.1 of the California Insurance Code.
CASHIER'S, CERTIFIED or TELLER'S checks, payable to FIDELITY NATIONAL
TITLE are generally available for disbursement on the next business day following the
date of deposit.
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)
ALL PARTIES TO THIS ESCROW ACKNOWLEDGE THAT FIDELITY NATIONAL TITLE
DOES NOT PROVIDE LEGAL ADVICE NOR HAS IT MADE ANY INVESTIGATION,
REPRESENTATIONS OR ASSURANCES WHATSOEVER REGARDING THE LEGAL
ASPECTS OR COMPLIANCE OF THIS TRANSACTION WITH ANY TAX, SECURITIES
OR ANY OTHER STATE OR FEDERAL LAWS. IT IS RECOMMENDED THAT THE
PARTIES OBTAIN INDEPENDENT LEGAL COUNSEL AS TO SUCH MATTERS.
4485114.3 Exhibit 2.1 - 4
■
THE FOREGOING ESCROW INSTRUCTIONS AND GENERAL PROVISIONS HAVE
BEEN READ AND ARE UNDERSTOOD AND AGREED TO BY EACH OF THE
UNDERSIGNED.
SELLER:
VERIZON CALIFORNIA INC.,
a California corporation
By:
Title:
Current Address:
c/o Verizon Corporate Real Estate
112 S. Lakeview Canyon Rd. (CA501CW)
Thousand Oaks, California 91362
Attention:
BUYER:
TOWN OF LOS GATOS, a municipal
corporation
By:_
Title:
By:_
Title:
Current Address:
4485114.3 Exhibit 2.1 - 5
AGREEMENT OF PURCHASE AND SALE
AND ESCROW INSTRUCTIONS
EXHIBIT "23"
GRANT DEED
RECORDING REQUESTED BY AND
WHEN RECORDED MAIL TO AND MAIL
TAX BILLS TO:
Town of Los Gatos
Space Above For Recorder's Use
GRANT DEED
Title Order No.
APN No.
The undersigned grantor declares:
Documentary Transfer Tax is $
computed on full value of property conveyed; or
O computed on full value less value of liens and
encumbrances remaining at time of sale.
O Unincorporated area; ( ) City of
Escrow No.
FOR A VALUABLE CONSIDERATION, receipt of which is hereby acknowledged,
VERIZON CALIFORNIA INC., a California corporation, formerly known as GTE California
Incorporated ("Grantor"), hereby GRANTS to TOWN OF LOS GATOS, a municipal
corporation ("Grantee"), the following described real property in the County of Santa Clara,
State of California:
PER ATTACHED LEGAL DESCRIPTION
4485114.3 Exhibit 2.3 - I
This foregoing grant of real property is subject to non-delinquent taxes, all easements, covenants,
conditions and restrictions, and all other matters of record affecting title to such property.
Dated: , 200 VERIZON CALIFORNIA INC.,
a California corporation
By:
Title:
4485114.3 Exhibit 2.3 - 1
ACKNOWLEDGMENT
STATE OF
COUNTY OF
) ss.
On , before me, ,
personally appeared , personally known to me (or proved to
me on the basis of satisfactory evidence) to be the person(s) whose name(s) is/are subscribed to
the within instrument and acknowledged to me that he/she/they executed the same in
his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the
person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.
WITNESS my hand and official seal.
Notary Public
(Seal)
4485114.3 Exhibit 2.3 - 2
AGREEMENT OF PURCHASE AND SALE
AND ESCROW INSTRUCTIONS
EXHIBIT "2.11"
PROPOSED SITE PLAN
[to be attached]
44851143 Exhibit 2.3 - 3