2015-068 - Approve Purchase and Sale Agreement for the Repurchase of an Affordable Housing Unit at 108 Sierra LindaRESOLUTION 2015 -068
RESOLUTION OF THE TOWN COUNCIL
OF THE TOWN OF LOS GATOS
APPROVING A PURCHASE AND SALE AGREEMENT FOR THE
REPURCHASE OF AN AFFORDABLE HOUSING UNIT SUBJECT TO AN EXISTING
BELOW MARKET PRICE (BMP) FIRST RIGHT OF REFUSAL OPTION, LOCATED
AT 108 SIERRA LINDA, LOS GATOS, CA, APN 407 -17 -035, AND AUTHORIZING THE
TOWN MANAGER TO NEGOTIATE AND EXECUTE ALL AGREEMENTS AND
DOCUMENTS NECESSARY AND APPROPRIATE TO EFFECTUATE
THE PRESERVATION OF THE AFFORDABLE HOUSING UNIT
WHEREAS, the Town of Los Gatos Zoning Ordinance Sections 29.10.3000 through
29.10.2040 establish a Below Market Price (BMP) Housing Program to assist low and moderate
income Los Gatos citizens purchase homes at prices below market value; and
WHEREAS, the residential unit located at 108 Sierra Linda was purchased as a BMP unit
by the property owner through the BMP Housing Program for a reduced sales price that is
affordable to lower income households; and
WHEREAS, the BMP Housing Program requires as a condition of participation that a
Deed Restriction with a First Right of Refusal Option allowing the Town to repurchase units at a
designated sales price be recorded on the title record of BMP units; and
WHEREAS, a Deed Restriction with a First Right of Refusal Option was recorded for this
BMP unit on March 1, 2005; and
WHEREAS, the Town was notified that the property is in foreclosure and will be sold at a
foreclosure sale December 31, 2015; and
WHEREAS, the Town has indicated it is exercising its First Right Option and purchasing
the unit for the designated sales prices of $360,000; and
WHEREAS, this resolution provides for the acquisition of this BMP unit by the Town of
Los Gatos and authorizes the Town Manager to negotiate and execute all agreements and
documents necessary and appropriate to effectuate the preservation of the affordable housing unit.
NOW, THEREFORE, BE IT RESOLVED, that the Town Council of the Town of Los
approves a Purchase and Sale Agreement and Joint Escrow Instructions for the purchase of the
BMP unit at 108 Siena Linda shown in Exhibit A.
PASSED AND ADOPTED at a regular meeting of the Town Council of the Town of Los
Gatos, California, held on the 15`h day of December 2015 by the following vote:
COUNCIL MEMBERS:
AYES: Marcia Jensen, Steve Leonardis, Rob Rennie, Marico Sayoc, Mayor Barbara Spector
NAYS:
ABSENT:
ABSTAIN:
SI N D
0
MAYOR/OF THE TOWN OF LOS GATOS
LOS - ATOS, CALIFORNIA
ATTEST: DATE:
CLERK ADMIiVISTRATOR OF THE TOWN OF LOS GATOS
LOS iATO.S, CALIFORNIA
2 of 2
Resolution 2015 -068 December 15, 2015
CLERK DETARTME' Y
AC -i R.
PURCHASE AND SALE AC >iZI'I<.MENT
AND 01 D
JOINT ESCRONA1 INSTRUCTIONS REe—_ �
RES '— .
THIS PURCHASE- AND SALE AGREE viEN7 AND .TOJNT t SCRO\V tNSTRUCTIOls'S
(this "Agreement ") is dated fo identification the 7th day of December, 2015, by and between
MICHELLE L SURANOFShY, a single person, (`Buyer ") and 'TOWN OF LOS GATOS, a
nr
Cahibra municipal corporation (11 Seller"). Buyer and Seller are sometimes referred to herein
individually as a "Party" and co(lectiveiy as the "Parties
A. Seller owns the real property located at 108 Sierra Linda, in the Town of F,os Csatos
(the "Town')- Santa Clara County ( "County „), California (APN 407- 17- 0 35), moie roily
described on Exhibit A ( "Legal Description of the Proper, ), attached hereto and incorporated
herein by this reference (the "Real Property").
13. Seller agrees to sell the Rua) Property to Buyer and Buyer agrees to Purchase the
Property from Seller in accordance with the conditions set forth in the "Notice of Recorded Deed
Restrictions and First Right of Refusal of the Town of Los Gatos" recorded on March i, 2005 in
the County of Santa Clara, Document No.! 825674 and on all of the teens. covenants and
conditions set forth in this Agreement.
NOW, THEREFORE, in consideration of the foregoing recitals, the promises and
covenants of the Parties in this Agreement, and other good and valuahle consideration, the
receipt and Sufficiency ofwhich the Parties acknowledge, the Parties agree as follou-s:
1. Definitions_ Certain capitalized terins used in this Agreement have the meanings
defined below:
Closin” means tite date upon which a grant deed is recorded in the Official Records
of the County title to the properly is conveyed to Buyer subject only to the Permitted
Exceptions, and possession of the Property is delivered to Buyer, in accordance with the tenans of
this Agreerent.
Clcsine Pate shall be December 28, 2015 or such other date as may be imatualiv
agreed to by Buyer and Seller in writing.
Fffec"ve 13ate means tl e date upon which both Buyer and Seller have executed this
Agreement, and Buyer has received eiiher a copy or an o
executed, ginal of this Agreement as so
Lser_oR' means the escrow established pursuant to this Agreement through ot,hieh the
Purchase and sale of the Property shall be consummated.
Escrow Cancellation Chartres is defined in Section I0.2.
Escrow_Idolder means Old Republic Title Company having an office at 438 N. Santa
Cruz Avenue, Los Gatos, CA 95050,
Hazardous Materials is defined in Section 1 1.6.
Improvements means all improvements, structures, and fixtures situated on the Real
Property, together with all of Seller's right, title and interest in all parking areas, landscaping, and
other improvements, structures, and fixtures.
Inspections is defined in Section 4.2.
Objections is defined in Section 4.2,
Obiection Election Notice is defined in Section 4.2.
0bjection Notice is defined in Section 4.2.
O enin&of Escrow is the date on which Escrow is opened under Section 3.
Partts and Partv are defined in the first paragraph of this Agreement.
Permitted Bxecptions means general and special real property taxes and assessments,
a lien not yet due and payable; any other liens, easements, encumbrances, covenants, conditions
and restrictions of record which are not Disapproved Exceptions as described in Section 4.1
below, unless Buyer waives its disapproval of such Disapproved Exception(s), and any liens,
easements, encumbrances, covenants, conditions or restrictions which are created larder the
signature of Buyer.
Personal Property means all of Seller's interest in all equipment, furniture,
furnishings, machinery, heating, plumbing, ventilation and air conditioning systems and
equipment, carpet, tile, floor coverings, security devices, sprinkler systems, leasing files and
records, keys, maintenance equipment and supplies and all other tangible personal property
situated on the Real Property and used in connection therewith or with the Improvements, but
excluding the items listed in Exhibit B attached hereto and incorporated herein by this reference,
which items shall remain Seller's property, are not to be conveyed to Buyer under this
Agreement, and may be removed from the Real Property by Seller.
Profierty is defined in the Recitals to this Agreement.
Purchase Price means Three Hundred and Sixty Thousand Dollars (5360,000),
Rents means base rent, common area maintenance, parking, tax, insurance and other
payments due and payable under any Lease for all or any portion of the Real Property
�r
improVeXtxnts' togethe7 wltil .rtl ,ales and other taxes ther-coji. and all other 7 m pie generated ba
all or any portion of the Property,
Seller is defined in the first paragraph efthis Agreement.
Title Cosanv means Old Republic Title C ompany.
Title Policy means a current CLTA owner's title insurance policy with such
endorsements as Buyer may reasonably request, in amount equal to the Purchase Price, insuring
fee title to the Property vested in Buyer, subject only, to the Perinitted Exceptions,
2. Purchase and Sale. Seller agrees to sc" the Property to Buyer, and Buyer agrees to 111
Purchase the Property frorn Seller, on the terms and conditions set forth herein.
-Escrow. An escrow account was opened by Town on December 2, ?01 S. tVithin two
(2) days after the rmituai execution of flies Agreement by the Part ies, the. Parties shall deliver an
executed copy of this Agreement to Escrow Holder. This Agreement shall constitute joint
escrow instructions to Escrow Holder. The Parties shall execute such additional instructions not
inconsistent with the provisions of this Agreement which may be reasonably required by Escrow
Bolder and shall be bound by Escrow Holder's genera! instructions; provided, however, that as
between the Parties, if any conflict between the provisions of this Agreement and the provisions
of Escrow Holder's general instructions exists or arises, then the provisions of this Agreement
shall control Escrow Bolder is designated the "real estate reporting person" for purposes of
Section 6045 of the internal Revenue Code of 1986, as amended, and Treasury
Regulation L6 )45 -4; and any instructions or settlement statement prepared by Escrows Holder
shall so provide Escrow Holder shall be responsible for filing Fornr 1099 -S with, the Internal
Revenue Service.
4. Buyer 's Pnspectious; Feasibility lnvestivatignsi Town oun i1_ A nroyal: Estoppel
Certificates.
4,1 Title.
(a) Cipon execution of this Agreement by the Parties, Buyer, at its sole cost
and expense, shall deliver to Seller and Buyer a current preliminary report (" "Preliminary
Report") of title to the Real Property, issued by the Title Company, together with legible copies
of all documents referenced therein as exceptions to title and a plot plan for the Real Property
showing the Iocations of all the recorded easements. On or before December 15, 2015, Buyer
shall notify Seller of Buyer's objections to title, if any.
b) Seller shall deliver title to tiro Prepery at Closing subject only to the
Permitted Exceptions. Any exceptions to title shown on any .supplement to the Preliminary
Report that may be issued front time to time by the Title Company following December I5. 2015
shall be removed by Seller at or prior to Closing.
4 2 Feasibility Study. Upon execution of this Agreement by the Parties, Seller
shall, to the extent such items are in Sellers possession, promptly provide Buyer with any and all
documentation with respect to any conditions that currently exist on the Property, if any,
cota'espondence or other documents in SeIler`s possession that may be relevant to the condition of
the Property; including, without limitation, correspondence or documents related in any manner
to the current maintenance or repair of the Property, including construction warranties,
indemnities, all studies, reports agreements, documents, leases (including, without limitation.
the Leases), surveys, engineering studies, geological reports, architect's drawings, plans, maps,
building contracts, permits and entitlements in Seller's possession or control concerning the
Property and its improvement and development (collectively, the "Feasibility Materials "), and
Seller shall instruct its engineers, architects, surveyors, marketing consultants, tenants and other
advisors, consultants and agents ( "Seller's Consultants"), it any, to share any information or
knowledge they have concerning the Property with Buyer. Buyer and its agents may enter onto
the Real Property to make such inspections, audits, feasibility studies, soil and engineering tests
and surveys and other examinations thereof (collectively, "Inspections ") as Buyer deems
reasonably necessary, provided that Buyer shall give at least seventy -two (72) hours prior notice
to Seller of any intended entry onto the Real Property, and any such entry shall not unreasonably
interfere with Seller's use of or activities on the Real Property. Buyer shalt repair any damage to
the Property resulting from such entry. However; Buyer's review and investigation of the
Property shall not in any way preclude Buyer from relying on ''he representations and warranties
made by Seller in this Agreement. On or before the Feasibility Date, Buyer shall notify Seller in
writing of any objections (the "Objections ") Buyer has to the condition of the Property disclosed
by the Inspections ('the "Objection Notice"). Seller shall, within three (3) days after its receipt of
the Objection Notice from Buyer, provide Buyer and Escrow Holder with written notice
regarding whether Seller intends to, at Seller's cost, clear the Property of and /or <resolve the
Objections to Buyer's reasonable satisfaction. tf Seller does not notify Buyer and Escrow Holder
within said three (3) day period that Seller has arranged to have the Objections cleared from the
Property or otherwise resolved to Buyer's reasonable satisfaction, Buyer shall have the right, but
not the obligation, to remove the Objections and Seller shall cooperate with Buyer to have the
Objections cleared. Seller shall be obligated and shall reimburse Buyer for any and all costs
associated with the removal of the Objections at time of Closing and settlement of Escrow funds.
4.3 Access. Seller grants to Buyer and Bu}�er's agents, employees and consultants a
nonexclusive license to enter upon the Property during business hours at times reasonably
acceptable to Buyer and Seller on not less than seventy -tv,,o (72) hours prior notice to Seller, for
the purpose of allowing Buyer to conduct whatever soil and engineering tests, feasibility studies,
surveys and other examinations of the Property Buyer deems appropriate, provided that Buyer
may not perform any intrusive, invasive or destructive testing of the Real Property without
obtaining Seller's prior written consent, such consent not to be unreasonably withheld or
delayed.
4.4 Town. Council A > rovai. The "Town Council shall approve this agreement. If
documentation of the Town Council approval is not provided by December I7, 2015, the `Town
Council will deemed to have affirmatively rejected the purchase of the Property in accordance
with the terms of this Agreement, in which event this Agreement shall automatically terminate.
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S. Closing: Deposrt O? hril`L'1 ?' P
»-c — .t— .— ._- .�Isc._ rice.
> 1 Sutlect to Buce2 s InOht to ter Innate Oils Fag cement in accordance with
Section 4, the tr nelr satisfaction ()fall of the Conditions to C h sing u+ fo. �h In See, )n 9. and the
rep esentations and c,arrantics o Seller and I3uye?' herein being irue as of the Closing Bate. the
C"'aug shall occur or! the Closing Date.
5.2 provided Seller has deposited all of the rtems required by Section; 7 below no
Islet, than two (2) business days prior to the Closing ,'date, and provided the Title Company has
confirmed to Buyer in writinh that it is unconditionally prepared to issue the Title Policy to
Buyer. subject only io the Permitted I`xceptions, upon consummation of the Closing, on or
before the Closing Date, Buyer- snail deposit with Escrow Holder thrc, Purchase Price and Buyer's
share of closing costs and prorations as provided in Section 6 below, in immediate ly available
funds Escrow Holder shalt hold all funds deposited by Buyer with it pursuant to this
Agree ter t. Including ovithout limitation the Purchase Price If and when deposited in accordance
with this section, in an Interest- bearing accoant.
6 Closir il r
Costs anc� I rotations.
6.1 Closing Costs. Buyer shall pay all closing costs as customary for Santa C Tara
Cot,ntr including but not limited to Title Insurance, Escrow tees, and al)' other closing cost
related to The transaction.
6.'_ _I' i)perty "I_ti ,es and C}�eratin t F p uses.
i
(a) "Talcs aid -�- SGSS!nen%<;. All real estate taxes and assessments on the
property shalt be paid hg Buyer.
(b) C)j eratr T_Fzpenses. .R11 utllrts service charges f22r elc tricity, (leaf and
ail' cOnd ltioninti S(.r L2 ee, other Ut-1 les, elevator r7lalntt,natlCe, common area maintenance, taxes
(other than real estate taxes), other expenses incured in operating the Property that Seller
customarily pays, and any other costs incurred in the ordinary course of business or the
management and operation of the Property shall be prorated on an accrual basis. Seller shall pay
all such expenses that accrue pnioi to vacaring the rYoperty. This obligation shall snrviv-e the
Closing. Any uni=ty security deposits to be refunded to Seller shall be obtained by Seller fi-OM
the utility company, and Buyer shall make its own deposit with such companies. Seiler will
notify all utilit} companies servicing the Property of the sale of the Property to Buyer and will
eyuest that such companies send Seller a final hill for the pericid ending on tine last day before
acatir,g the propcny. Buyer will notify the utiBty companies that all utility bills for the period
cornmcn ing or the vacating of Pronc,-ry date are to be sent to Buyer.
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y_ De
PO4its by Seder. No Iater than three (3) business days prior to the Closing bate,
Seller shall deposit with Escrow Holder_
a. A grant decd, on the Title Company's standard form, duly executed by Seller
(the "Grant Deed'), acknowledged and in recordable form, subject only to the Permitted
Exceptions. At Buyer's option, the Grant Deed may include an Assignment of' Declarant's
Rights.
b. Seller's Nonforeign Affidavit in the form accepted by the Title Company, duly
executed by Seller ( "Nonforeign Affidavit ").
c. A Real Estate Wnhholding Exemption Certificate as required by California
1Zevenue. and Taxation Code (Form 593) ( "State Withholding Certificate"),
d. Such other bills of sale, assignments and other ,instruments of transfer or
conveyance as Buyer or Escrow holder may reasonably request or as may be otherwise
necessary to evidence and effect the sale, assigrnment, transfer, conveyance and delivery of the
Property to Buyer.
S. I}e�osits by Bu %er. Prior to the Closing, Buyer shall deposit with Escrow Holder the
following_
a. The Purchase Price in immediately available funds in accordance with
Section 5.
b. Such other instruments or documents as Escrow Holder may reasonably request
or may be necessary to effect the sale, assignment, transfer, conveyance and delivery of the
Properly to Buyer.
9. Conditions to Closing.
4.1 Conditions to Buyer's Oblinations. The Closing and Buyer's obligation to
purchase the Property are subject to the satisfaction ofthe following conditions or Buyers
written waiver of such conditions on or before the Closing Date. Buyer may waive in writing
any or all of such conditions in its sole and absolute discretion.
(a) Buyer shall have timely delivered documentation of -I own Council
Approval.
(b) Seller shall have performed all obligations to be performed by Seller
pursuant to this Agreement prior to Closing.
(c) Seller's represcntations and warranties set forth herein shall be true and
correct as of the Closing.
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{d} The Title Company shad be committed to issue the "Title Policy to Buyer
ezfcctwe as of the Clos ng Date.
(e) Between the Effective ])are and the C losing Date, there shall have been no
material changes ii; the condition or status or fitness of the Rea; Property that would adversely
affect Buyer's intended use of the Real Prooenv,
9.2 Conditions to Seller`s Of ligations. Closing and Seller's obligation to
consummate the transactions contemplated by this Agreement are subject to the satisfaction of
the conditions that as of the Closing Date:
(a) Buyer shall have performed alI obIigatioars to be performed by Buyer
pursuant to this Agreement pion to Closin..
bj Buyer's representations and warranties set forth herein shall be true and
correct as of the Closing.
10. Ciosin Covenants.
10.1 Escrow Holder's Actions, upon the Closing Date, when Escrow Holder holds
the items required to be deposited by Seiler and Buyer as described above and Title Company is
prepared to issue and deliver to Buyer the applicable Title policy, Escrow Holder is instructed
and authorized to (i) record the Grant Deed in the Office of the County Recorder of the County;
(ii) record the Assignment of Declarants Rights (if any, and if separate from the Grant Deed} in
the Office of the County Recorder of the County; (in) title a Real Estate Withholding Exemption
Certificate, if required, with the State of California Franchise Tax Board or other taxing
authority; Ov) pay any transfer taxes; (v) pay any outstanding amounts due to I-lomeowmers
Association„ property taxes, or any other outstanding hcn; (vi) instruct the County Recorder to
return the Grant Deed to Buver; (vii) disburse to Seiler horn the funds deposited into Escrow by
Buyer the Purchase Price, rf anv exist; (viii) disburse from fiznds deposited by Buyer amounts
toward payment of alI other items chargeable to the account of Buyer hereunder, and disburse the
balance of such funds; if any, to Buyer,, (ix) deliver to Buyer the dionforeign Affidavit; and (x)
the Title Policy_
10.2 Escrow CaircehaYl6Il Charges. If the dosing does not occur because of the
default of a Pany the defaulting Party shall hear all Fscrev Cancellation Charges. If the Closing
does not occur for any reason other than the default of a Party, then Buyer and Seiler shall each
pay one half (1, 2) of any Escrow Cancellation Charges. As used herein, "Escrow Cancellation
f"harges" means all fees. charges and expenses incurred by Escrow Holder or third parties
erugaged by Escror✓ Holder as well as alt expenses related to the services of the Title Company in
connection with the issuance of the preliminary report and other title matters.
10.3 Conveyance and Possessio_1 upon E losimg, Seller shall ta) convey title to the
Pmpert: to Buyer subject only to the Permitted Exceptions; and (b) delive exclusrc e possession
of the Property to Buver. In addition, in the event any claim is made by any prior owner,
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mortgagee, developer, Tenant or other claimant against Seller m Buyer related in any way to
Seller's right to convey the Property, Seller shall defend and indemnify Buyer.
10.4 Relocation Costs. to addition to any other rights, remedies and /or consideration
provided for under this Agreement, Buyer has offered to pay to Seiler a sum not to exceed
$5,000 dollars to cover actual moving and relocation expenses ( "Reimbursable Relocation
Costs ") ii; exchange for Buyer moving from and leaving the premises clear of all possessions
prior- to February 1, 2016. With the exception Of the foregoing, Seller hereby waives its right to
receive from Buyer, and releases Buyer from any and all obligation to pay, any other amounts
Wider the California Relocation Assistance Law (California Government Code section 7260 et
seq.) and /or Title 25 of the California Code of Regulations. As an express condition to the
Buyer's obligation to pay Seller any Rernbuisable Relocation Costs, Seller shall submit to Buyer
the invoices for Seller's Reimbursable Relocation Costs, which invoices shall clearly document
the specific expenses incurred by the Seller and shall otherwise be in a form reasonably
acceptable to the Buyer.
1 1. RePresentations and Warranties of Seller. Seller makes the following representations
and warranties to Buyer:
I1.1 Seller owns the Real Property in fee simple absolute and has good and
marketable title to the Real Property, subject to no liens, claims or encumbrances other than
those disclosed in the Preliminary Report. Seller has not alienated, encumbered, transferred,
optioned, leased, assigned, transferred or otherwise conveyed its interest or any portion of its
interest in the Real Property or any portion thereof except as set forth in the Preliminary Report
and as disclosed herein, nor has Seller entered into any agreement (other than this Agreement) so
to do, unless such agreement(s) have been provided to Buyer in accordance with Section 4.2
above.
11 2 Other than as expressly disclosed to Buyer, Seller has made no oral or written
commitments or representations to, or understandings or agreements with, ally person, firm of-
,entity, any adjoining property owner or any authority which would in any way be binding on
Buyer or would interfere with Buyer's ability to develop and unprove the Property, and Seller
shall not make or enter into any such commitment representations , understandings or
agreements without Buyer's written consent.
1 1.3 The Seder's materials delivered to Buyer in connection with the purchase and
sale of the Property are all of the documents, leases, or agreements affecting the Property in
Seller's possession.
11.4 Except as disclosed to Buyer in writing, Seller has received no notice from any
governmental body or agency or any other person or entity that: (a) asbestos- containing
materials were installed or exposed in the Property through demolition, renovation or otherwise
at any time during or prior to Seller's ownership of the Property: (b) electrical transformers or
other equipment containing PCBs are or were located on the Property at any time during or prior
to Seller's ownership of the Property, (c) storage tanks for gasoline, heating oil or diesel fuel or
any other substances are or were located on or under the Property at any time during or prior to
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Seder's owner ;hip of tile Propi rr;; and (d) nnatet:als regulated under anv Federal. Stag or local
law orregalatmn, as amended trop; time to tire, as a toxic Hazardous, contaminated of similarly
harm harmful or dangerous material or substance (including, without limitation; asbestos and radon)
are or ivere located oil, in or under the Property o,, have stfected the Property or waters on or
under the Property at any time during or prior to Seller`s owl-lership of the Property. For the
Purposes of this; Agreement the team "hazardous Materials" means any substance, product,
waste or other material of any nature whatsoever which is or becomes listed, regulated or
addressed pursuant to the Comprehensive Environmental Response Compensation and Liability
Act; 42 U.S.0 . Section 9601, ei seq.; the Resource Conservation and Recovery Act, 42 U.S.C.
Section 6401 et seq.; the Clean Water Act, 33 L1.S_C, Section 1251 et seq.; and the California
Hazardous Waste Conrrol Act, health & Safety Code Section 25100 et secs.
11.5 Seller halt not received any tvi-i ren notice under the California Health and
Safety Code or any other applicable local, State or Federal law regarding Hazardous Materials
on, under or affecting the I'roj?erty or requiring the removal of any hazardous Materials from the
Property.
11.6 Seiler is not a "foreign person" within the meaning of IRC Section 1445,
11.7 Seller has 1101 entered into ally and there are ?no teases or other agreements
relating to any portion of the Proper y; and no person; other than the Seller, has any right of
Possession to the Property or ally part thereof.
11.8 Seller is an individual and has full capacity, right, power, and authority to
enter- into this Agreement and to perfornn its obligations hereunder, and the person(s) executing
this Agreement on behalf of Seller have the right, power and authority to do se.
1 l.9 Except as disclosed in the Preliminary Report, Seller has received no written
notice of anv special assessments (whether froin an assessment district., facilities district oi-
Other wise) against the Property being contemplated.
I 1.10 Seller has not received any notice from any of Sellers insurance carriers of
any defects or inadequacies in the Property, or any portion thereof; which would adversely affect
she insuiabiliry of the Property or the cost of any such insurance. There are no pending insurance
claiins by Seller with respect to any poliion of the Real Property.
1.11 Seller is not bankrupt of insolvent under any applicable Federal or State
standard, nor has Seller tiled fcr protection or rehefu rider any applicable bankruptcy or creditor
protection statute nor has .Seiler been threatened by creditors nsiith an involuntary application of
any appIic,abie bankruptcy or creditor protection statute. Seller is not entering into the
transactions described in this Agreement nvith intent to defraud any creditor or to prefer the rights
of one creditor over any other. Seiler and Buyer have negotiated this Agreement at arms- length
and the consideration to be paid represents fair value rot the assets to be transferred.
1;.12 "There are no unrecorded !cases, licenses or other p
Real Property. o sensory interests in the
_q_
i 1.13 I Wei nit �. Seller hereby agrees to indemnify, protect, defend and hold Buyer
and th le
e Property harmless from and against any damage, clann, liability or expense of any kind
whatsoever (including, without limitation, reasonable attorney's fees and fees of expert
witnesses) arising from or in connection with any breach of any of the foregoing representations
and warranties of Seller and any other representations or warranties of Seller contained
elsewhere in this Agreement. Such representations and warranties of Seller and any other
representations and warranties of Seller contained elsewhere in this Agreement are true and
correct on and as of the date of this Agreement and shall he true and correct on and as of the date
of the Closing, and shall survive tine Closing, without the necessity of a separate written
certificate regarding the same. If after the date of this Agreement, but prior to the Close of
Escrow, Buyer or Seller- should learn, discover or become 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"), then the Party who has
learned, discovered or become aware of such Representation Matter shall promptly give written
notice thereof to the other Party. Any Representation Matter caused by deliberate acts of Seller
or fi-audulently made by Seller is a default by Seller. Regarding any other Representation
Matter, Buyer shall have the right, in its sole discretion, to either (i) waive in writing and proceed
to acquire the Property or the tears set forth in this Agreement hereunder, or (ii) terminate this
Agreement, and the Deposit and any other amounts paid by Buyer to Seller or deposited into
Escrow by Buyer shall be immediately returned to Buyer. Upon such termination, neither Party
hereunder shall have any fniher obligations or liabilities under- this Agreement except as
specifically set forth herein.
Seller's knowledge Defined The phrases 'to Seller's actual knowledge" or "to the actual
knowledge of Seller' as used in this Section 11 mean to the actual, present knowledge of Pastor
Richard Grandquist and the current members of the Seller's Hoard of Directors, without anv duty
o ' further inquiry or investigation, and without the imputation to such individuals of the
knowledge of any other person.
Limitations. Any action against Seller based upon an alleged breach of Seller's
representations and warranties herein must be filed within six (6) months after Seller relinquishes
physical possession of the Real Property to Buyer, and failure to timely flie any such action shall
be deemed Buyer's waiver and release of anv such action.
AS -IS Convey. Buyer- expressly acknowledges and agrees that, unless otherwise
expressly set forth in this Agreement: (a) Buyer has made such independent examinations and
inquiries as Buyer deems necessary and desirable with respect to the Property and the transaction
contemplated by this A &7eement; (d) Buyer is specifically purchasing the Property on an "AS -IS
WITH ALL FAULTS BASIS" and is relying solely upon Buyer's own independent
investigations, examinations and inquiries and the materials and information prepared by Buyer
or by third parties at Buyer's request in determining that the Property and each portion thereof is
suitable and adequate in all respects for any and all . activities and uses which Buyer may elect to
conduct thereon; (e) Seller is not snaking, has not made and expressly diselainns any
representation, warranty or other assurance whatsoever with respect to the Property or any
condition or feature thereof, (f) Buyer is fully acquainted with the nature and condition, in all
-I0-
re peas, of she Property, including the existence oar availability ofall permits and approvals fi-oul
f ovcr mental authorities amd the Soil and geolo��y thereof" and (g) Buyer understands that Buyer
w =ill be assinih-1g the entire risk of any and all potential Uncertainties regarding the Property.
S bjeci to zCCti on 11.1, BUY r specifically releases and war\as any clam: against Or habrlity of
SelleI' art sing Pr0111, Pelatlnol. t0 OI resulting iforS; ally law'. rule, ordinance, regulation; notice,
demand, order. citation, or other action or proposed action affecting the Property in any way
is,ued or taken after the Seiler relinquishes pilysicai possession of the Real Property to Buyer by
any governmental ?uusdietion, political subdivision, agency m- authority except, Pct withstanding
the foregoing or any other provision of this Agreement, Buyer does not waive any such claim or
liability of Seiler arising from, relating to or resulting from (x) any breach of any Seller
caicement, covenant. representation, or warranty that is expressev made under this Agreement by
Seller or (y) any other express obligation of Seller hereunder, including, without limitation.
Sellers indemnity obligations set forth in this Section ti 15 above (eolieetr�ely, a '`Seller
Gbh «atiolz' j. regardl ss of whether any such Seiler Obligation also fuses from relates to_ or
results from anv law, rule, ordinance, rclTulation, notice, demand, order, citation, or other action
or proposed action affecting the Property in any way issued or taken after the Closing by any
governmental jurisdiction, political subdivision, agency, or authority. I'he provisions of this
Section 1 1.15 shall survive the (:losing.
NQ- Additional Reirresentauons by Seller. Subject to, and except as specifically set forth in
Section 1 LI above, neither Seller nor any 0i its agents, parineis Of employees has made and does
not make any representations or �,"arrantres, whether oral or written, expressed or implied, with
respect to: (i) any Physical or environmental aspect or condition of the Property or any pail
thereof (including, Without limitation, the presence of any hazardous materials); (ii) any
dimension or spe ifcations of the Property of any part thereof. including, without limitation, the
square; footage of rentable area of the improvements or the number or suffrciehcy of parking
spaces on or about the Property; (iii) feasibility. desirac city, suitability, habitability or
convertibility of the Property and any p art thereof iu�o or for any particular use or pu pose; (iv)
the Toning, building or land use restrictions applicable to the Property or any part thereof; (v)
soil, seismic or other geological conditions effecting the Property or any pail thereof with any
applicable laws, rules or regulations, including, without limitation, use permits, building codes,
Pre and safety codes and Band capped access codes and regulations (including, without
limitation, the Americans With Disabilities Act); NO the truth accuracy or completeness of any
of the materials or documents delivered to Buyer except for documents prepared by Seller; (vii)
I availability or unavailability of governmental_ quasi - governmental or other permits,
approvals, licenses, or entitlements, if any, in any way relating to the Property or any part
thereof, (viii) the availability or unavailability of waur, severer, electric, telephone or other utility
services, arty, for the Property or any part thereof, (ix) the operability, adequacy, state of repair
or useful tife of any fixture, equipment, machinery or other apparatus of the Property; (x)
restrictions on hours of operation parking, types of +chants and uses, sign architectural and
other hnlitafians imposed by zoning use permits and other restrictions effecting the Property:
and (xi) any other matter of any nature whatsoever relating in any way to the Property or to any
of the documents delivered by Seller to Buyer. All representations, warranties and covenants of
Seder in this At are made as of the date of this Agreemarit and as of the Closing and
shall survive the Closing and the recordation of the Grant Deed. It shall be a material default
_f2_
hereunder if Seller is unable to make such representations and warranties truthfully as of the
Closing Date-
12. Representations and \A %arranties of Buyer. Buyer makes the following
representations, warranties and covenants to Seller:
12.1 Buyer is a California municipal corporation duly organized, validly existing
and in good standing under the Laws of the State of California. Buyer has the right, power and
authority to enter into this Agreement and to perform its obligations hereunder, and the persons)
executing this Agreement on behalf of Buyer have the right, power and authority to do so.
12.2 This Agreement constitutes the legal, valid and binding obligation of Buyer
entorceable against Buyer in accordance with its terms, except to the extent that such
enforcement may be limited by applicable bankruptcy, insolvency, moratorium and other
principles relating to or limiting the rights of contracting parties generally. This Agreement does
not violate any provision of any mateial agreement or document to which Buyer is a party or to
Which Buyer is bound.
All representations and warranties of Buyer in this Agreement are made as of the date
of this Agreement and as of the Closing, and shall survive the Closing and the recordation of the
Grant Deed. It shall he a material default hereunder if Buyer is unable to make such
representations and warranties truthfully as of the Closing Date.
1.1 Cotifieation by Seller of_Certain Matters- During the period prior to the Closing
Date, Seller shalt promptly advise Buyer in writing of any material adverse change in the
condition of the Property, any default by any Tenant under the terms of any of the Leases, the
occurrence of any event or the discovery of any fact which would render any representation or
warranty of Seller to Buyer in this Agreement, untrue or materially misleading, and any written
notice or other communication from any third person alleging that the consent of such third
person is or may be required m connection with the transactions conteruplatcd by this
Agreement.
14. Seller'sr'sCovenant Not to Further Encumber the Property. Seller shall rat, directly or
indirectly, alienate, encumber. transfer, option, lease, assign, sell, transfer or convey its interest
or any portion of such interest in the Property or any portion thereof, modify, supplement or
terminate any lease, or enter into any agreement to do so, so long as this Agreement is in force.
Seller shall timely discharge, prior to the Closing, any and all obligations relating to work
performed on or conducted at or materials delivered to Property from time to time by Seller, or at
Seller's direction or on its behalf, in order to prevent the filing of any claim or mechanic's lien
with respect to such work or materials_ Without limiting the foregoing, from the opening of
Escrow until the Close of Escrow, Seller shall not execute any new leases or amend, renew,
terminate, or accept the surrender of any existing tenancy or approve any sublease or assignment
of any lease (collectively, a "Lease Event ") without first obtaining Buyer's written consent to
such Lease Event.
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1 d. L ama e or Desk uetioti. of any *naterial damage or destruction to any of the Real
Property occurs prior to Closing, Selte shall immediately give Royer written notice o f such
damage or destruction, and Bever shali have the option exercisable within ten (10) days
thereafter ther to (r) tenrin to the Escrm , it vw�hich; c tie Escrow Holder shall in„nediately
return all documents instruments and moneys to rlie Party which deposited same in respect of
the Closing or (ii) accept the Property in its condition at that tittle, and to receive an assignment
Of all of Seller's rights to any insurance proceeds payable by reason of such damage or
destruction, with a commensurate reduction in the purchase Price, if Buyer elects to proceed
under Clause (ii) above, Seller shall not compromise; settle or adjust any such insurance chains
without Super's prior written consent. For purposes hereof, "material damage or destruction,-
shall be deemed to be such damage or destruction that is reasonably estimated to cost more titan
five percent (5 %) of the Purchase Price to repair or restore. 1f dan-iage or destruction to the Real
Property occurs which is not material, Buyer shall accept the Property in its condition at that
time, and shall receive an ass)Emmerit of ail of Seller's rights to any insurance proceeds payable
by reason of such dama ge. or dcstr uetion, without any reduction in the Purchase Pace_
16. Condemnation. if prior- to the Closing all or any portion of the Property is subject to
an actual a - threatened taking by a superior public authority. by the power of eminent domain or
otherwise, Buyer shah have tklc tight, exercisable by giving written notice to seller within ten
(10) business days after Buyer's receipt of written notice of such taking, either to (i) terminate
Escrow-, in which case Escrow Elolde shall immediately return all documents, instnuuents and
moneys to the Party which deposited same in icspect of the Closing; or (ii) to accept the.
applicable portion of the Property in its then condition and to receive an assignment of all of
Seller's rights to any condemnation award movable by reason of such taking. If Buyer elects to
proceed under Clause (ii) above, Seller shall not compromise, settle or adjust any claims to such
award without Buyer's prior written consent.
1?- Remedies.
7.1 if Seiler defaults hereunder or if the Closing does not occur by reasor, of
Seller's default hereunder, and it such default is not cured within ten (10) business days after
Buyer provides Seller With written notice of such default, then Buyer, at its option, may elect
either (i) to maintain this Agreement in full force and effect and pursue any remedies to which
Buyer may be entitled under- this Agreement, at law and/or in equity; or (ii) to terminate this
Agreement, and Buyer shall have the right to pursue an action for damages.
17.2 If Buyer defaults hereunder or if the Closing does not occur by reason of
Buyers default hereunder, and if such default is not cured within ten 00) days after Seiler
provides Buyer with written notice of such default, then Buyer, at its option, may cheer to
terminate this Agreement and pursue an action for damages, provided that tinder It()
circumstances shall Seller be entitled to a iudanment for specific. perforinance of this Agreement
and the maximum damages recoverable against Buyer shat be the actual costs and expenses
incurred by Seller in r,egotraiing this Ab ecrncut, up to a maximum of Five Thousand Dollars
55,00U), i']re foregoing represents the exclusive nghts and remedies available to Seller at law or
in equity in the event of Buyer's demult under or breach of this Agreement. Seller hereby waives
any and all rights it may now or hereafter have to recover any other damages on account of
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Buyer's breach, including, without limitation, Loss of bargain, special, punitive, compensatory or
consequential damages.
18. Miscellaneous,
18.1 Assignment. Seller shall not be entitled to assign this Agreement and its
rights and obligations hereunder without obtaining Buyer's prior written consent, which consent
will not be unreasonably withheld or delayed. Buyer shall be entitled to assign this Agreement
and its rights and obligations hereunder without obtaining Seller's prior written consent, provided
that Buyer shall not be released from its obligations hereunder by reason of such assignment or
delegation without Seller's written consent.
18.2 No Modifications. No addition to or modification of any term or provision of
this Agreement shall be effective unless set forth in writing and signed by both Seller and Buyer.
183 Construction _of Aereement. Each Party and attorneys for each Party have
participated in the drafting and preparation of this Agreement. Therefore, the provisions of this
Agreement shall not be construed in favor of or against either Party, but shall be construed as if
both Parties equally prepared this Agreement.
18.4 Headings. The paragraph headings herein are used only for the purpose of
convenience only and shalt not be deemed to limit the subject of the sections or paragraphs of
this Agreement of to be considered in their construction. Unless otherwise specifically referring
to another instrument or document, references to "Sections" and "Subsections" refer to the
Sections and Subsections of this Agreement.
18.5 Governing Law_ This Agreement shall be governed by and construed in
accordance with the laws of the State of California.
18.6 Time of the Essence. Time is of the essence of each and every provision of
this Agreement. Unless business days are expressly provided for, all references to "days" herein
shall refer to consecutive calendar days. If the Closing Date or any, other date or time period
provided for in this Agreement is or ends on a Saturday, Sunday or Federal, State or legal
holiday, then such date shall automatically be extended to the next day which is not a Saturday,
Sunday or Federal, State or legal holiday.
18.7 Successors and Assigns. Subject to the provisions of Section I8.1, alI of the
provisions of this Agreement shall inure to the 'benefit of and shalt be binding upon the
successors and assigns of the Parties.
18.8 Further Assurances. Each of the Parties shall execute and deliver any and all
additional papers, documents and other assurances, and shall do any and all acts and things
reasonably necessary in connection with the performance of their obligations hereunder and to
carry out the intent of this Agreement. Without limiting the generality of the foregoing, Seller
shall cooperate with Buyer by executing such documents and providing to Buyer or the
appropriate regulatory agency such items as Buyer or the appropriate regulatory agency may
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I'easonably request] and Selle2 shall C ot;per IC Linder any covenants, conditions and restrictions
attcetrng thr Proper'S -was to facilitate Buyer's development of the Property, provided such
c1}JpCrat70n entails no nlallml Joditional cost or ex.;iensfe to Seller.
18-9 No waiver The waiver by one Party of the performance of any covenant,
condition Or promise or of the time for perfottn:ng any act, under this Agreement shall not
nsuiidate }lily Agre neait nor shall if ec considered a waiver by such party of any other
cov c pant, condition 01' promise, 01 of the tine for performing any other act required. under this
Agreement. fhe exercise ofanv rcmeds Irovided in this Agreement shall not be a waiver of any
emedy provided by law; and the provisio -]s of this Agreement for any rer nedy shall not exclude
any other remedies unless the=y are exiaessly excluded.
l R.10 Severab 1i y. h" any provision der this Agreement shall become iIlegal, null or
.void or against public policy, roc any reason, or shall be held by any Conn of competent
yurisdlctiori to be illegal, null oI void or against public policy, the iernaining provisions of ]!his
Agreement shall not be affected thereby and shall remain in force and effect to the full extent
pertnmssible by law.
18 11 Gender and Number, In this Agecment. the masculine, femin ne and neuter
genders and the singular' and the plural include one another, unless the context requires
other-,vise.
I8 1 o Entire /` oicein nt. This lgrcenrertt constitutes the entire agreement between
the Paul
hes ,]ca aming to the subiect matter hereof and shall supersede ali prior and
contemporaneous agreements, representations, negotiations and understandings of the parties,
oral or written. The foregoing sentence shall in no way affect the validity of any instrument
executed by the Parties in the font] of the exhibits attached to this .Agreement.
8.1 Incorporation of Exhibits. All exhibits to this Agreement are incorporated
herein by this reference.
18.14 f_outricr p-,jE . r his Ag cement may be executed in counterparts, each of
h c1'r shalt constitute an original, but all of which together shall constitute one and the same
Instrument. The signature page of any counterpart may be detached therefrorn without impairing
the legal effect of ttte signalu e(s} thereon provided such signature page is attached to any other
counterpart identical thereto except having additional signature pages executed by the other
Party. Counterparts may be delivered by facsimile provided that original executed counterparts
are delivered to the recipient on the next business day following the facsimile transmission.
18.15 Attola]ec- Fees. ?f any action or proceeding is instituted to enforce or
interpret any provision of this Agreement, the prevailing Party therein shall be entitled to recover
s attorneys' fees and costs fron. the losing party.
18-16 Notices. Any noire e to be given here -urAer to either ]'arty or to Escrow "_elder
shall be ]! writing and shall be given either by personal delivery (inciudmg express or courier
_l_
service), or by registered or certified mail, with return receipt requested, postage prepaid and
addressed as follows:
To Buyer. Conununity Development Director
Town of Los Gatos
110 E. Main Street
Los Gatos, CA 95030
To Seller: MICHELLE L. SURANOFSKY
108 Sierra Linda
Los Gatos, CA 95030
Any Party may, by written notice to tire others and to Escrow Holder,
designate a different address which shall be substituted for the one specified above. Any such
notice shall be deemed to have been delivered upon its receipt or upon the second attempt at
delivery, as evidenced by the regular records of the person or entity attempting delivery.
18.17 Relationslim of Parties. The Parties agree that their relationship is that of
Scher and Buyer, respectively, and that nothing contained herein shall make either Party the
fiduciary of the other for any purpose whatsoever, nor shall this Agreement be deemed to create
any form of business organization between the Parties, including, without limitation, a joint
venture or partnership, nor is either Party granted any right or authority to assume or create any
obligation or responsibility on behalf of the other Party, nor shall cither Party be in any way
liable for any debt of the other.
18.18 Survival. The agreements, representations, covenants and -warranties of the
Parties contained herein shall survive the Closing and the delivery of Grant Deed.
18.19 Real Estate Commissions. Seller represents and warrants that it has not
retained the services of a real estate brokerage in the listing and sale of the Real Property_ Seller
shall be solely responsible for all fees and commissions if Selter has retained the services of a
brokerage. Buyer represents and warrants that it has not engaged or used any real estate broker,
agent or salesman in connection with the transaction contemplated by this Agreement. Buyer
and Seller each agree that it will indemnify and hold the other Party harmless from and against
any and all claims, losses, damages, costs or expenses (including attorneys` fees) of any kind or
character arising out of or resulting from any agreement or arrangement with any other broker or
finder in connection with this Agreement or the transactions contemplated by this Agreement.
The foregoing indemnity will survive the expiration or termination of this Agreement.
1 8.20 Arbitration of Disputes. Except as otherwise provided in this Agreement, any
controversy or dispute arising out of this Agreement or the interpretation of any of the provisions
hereof shall be submitted to arbitration in Santa Clara County, California, under the commercial
arbitration rule,,, then obtaining of the American Arbitration Association. Any award or decision
obtained from any such arbitration proceeding shall be final and binding on the Parties, and
judgment upon any award thus obtained may be entered in any court having jurisdiction thereof.
No action at law or in equity based upon any claim arising out of or related to this Agreement
-16-
shall be in,titmed in any cowl by any parry hereto except (a) an action to compel arbitration
puisuant to this section: or (b) an action to enforce an award obtained In at-.. and inatlon
pIt)f'C eating in acemd 3nce vith t} ,s sE cilon, Ail I Cilces vlailP,`> to any arbitraitlon shall be given
as movtoed In this Agroemeni.
18.21 Conflic- of Interest. No member_ official or employee of Buyer shall have anv
Personal micae'.St, direct or indirect, in this Agrecirleni, nor shall any such member., official or
emir oyc-e pat ticipatc in any derision related to this Agreement v hich affecis his,tier perst>na1
interest or the interest of any corporation., partnership or association in which he /she is directly or
indirectly interested. Seller warrants that Seller has not paid nor given and will not pay not give
any third person any move' oi any other consideration for obtalmn°_ this Agreernerit.
tN WITINESS WHEREOF, this Agreement is executed by BUYER and by SELLER.
Recommended by:
v
,aurcl nrevetll Community 1, Itl_rnent
Director
APPROVED AS TO FORM:
Robert Schultz, Cawrrttola7e - -
"BUYER"
TOWN OF LOS GA FOS.
a California municipal corporation
t
Ij
i aurel I'rct ettl, I oti I Mt�nager
"SEL.LER ":
MICHELLE L. SLIRANOFSKY
?lxlzibits: Exhibit A: Legal Description of the Property
f xhibit B: Excluded hems
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ACCIEPTANCT BY ESCROW HOLDER
Old Republic Title Company, hereby= acknowledges that it has received a fully executed
counterpart of the foregoing Ageement of Purchase and Sale of Real property and Joint Escrow
instructions ( "Agreement ") and agrees to act as Escrow Holdei under the Agreement and to be
bound by and perfonn the terns thereof as such terns apply to Escrow Holden
Dated
1 8-
OLD REPUBLIC TITLE COMPANY
B y'
—
Its: i
EXHIBIT A -
C'IF THE PURCHASE AND SALE AGREEMENT
AND JOINT ESCROW INSTRUCTIONS
LEGAL DESCRIPTION OF1 - -1-TE I'ROPERn
The ;arid referred to is situated in the County of Santa Clara, Town of Los Gams, State of
Cahfo nia, commonly kno���?s as Siena Linda, Los Crates (:ij1d'ornia, Santa Clara Assessor's
Parcel No. 40' -1 -055:
ALL OF LOT r? OF TRACT NO. 7927 .ARROYO RINCONDA ACCORDING TGr TF7E
MAP THEREOF tILFD FOR RECORD ON JUNE 22, 1982 IN BOOK 501 OF MAPS AT
PAGE 35 AND 36, SANTA CLARA COUNT` RECORDS.
EXCEPTING 'THEREFROM THE UNDERGROUND WATER RIGHTS I'S WITHO17
RIGHTS OF SURFACE ENTRY AS CO- NVEYED TO SAN JOSE WATER WORKS, A
CAt.II,ORNIA CORPORATION. BY DIED RECORDED SEPTEVIBLR 17, 1981 IN NOOK
H029. PAGE 217 OF OFFICIAL RECORDS.
APN: 407-17-035
A9_
EXHIBIT a-
O THE PURCHASE AND SALE AGREEMENT
AND JOINT ESCROW INSTRUCTIONS
EXCLUDED ITEMS
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