REAL ESTATE PURCHASE AND SALE AGREEMENT
This agreement (the "Agreement") is dated March 17 1998 and entered into by
and between XXXXXXX REAL ESTATE GROUP, a California corporation ("Seller") and
EAGLE HARDWARE & GARDEN, INC., a Washington corporation, or assigns ("Buyer")
for purchase and sale of certain real property consisting of approximately 15.19
acres located at the northeast corner of the Santa Xxx Freeway (Interstate 5)
and Carmenita Road in Norwalk, Los Angeles County, California, together with any
improvements thereon and all rights appurtenant thereto (the "Property"). The
Property is shown on Buyer's site plan dated February 2, 1998 and numbered
X473-B (the "Site Plan") and attached hereto as Exhibit A. A legal description
of the Property is attached to this Agreement as Exhibit B and made a part
hereof.
Seller agrees to sell, and Buyer agrees to buy, the Property upon and
subject to the terms and conditions set forth below:
1. PURCHASE PRICE; PAYMENT. The total purchase price for the Property
shall be eleven dollars and fifty cents ($11.50) per square foot of land. It is
estimated that the Property contains approximately 661,676 square feet and that
the purchase price will be seven million six hundred nine thousand two hundred
seventy-four dollars ($7,609,274.00). The area of the Property and the total
purchase price shall be determined by the new ALTA/ACSM, survey described below.
The purchase price shall be adjusted to the final certified square footage,
which amount, including the Deposit and interest accrued thereon, shall be paid
in cash upon closing.
2. XXXXXXX MONEY DEPOSIT. Buyer has opened an escrow account and
deposited xxxxxxx money of one hundred fifty thousand dollars ($150,000) (the
"Deposit") with Fidelity National Title Insurance Company (the "Closing Agent").
The Closing Agent shall place the Deposit in an interest-bearing account, with
interest to accrue to Buyer's benefit. The Deposit shall become non-refundable
after Buyer's satisfaction of waiver of the contingencies set forth in Section 3
below, but shall be applied against the purchase price. If this transaction does
not close due to failure to satisfy all of Buyer's contingencies or default by
Seller under this Agreement, the Deposit, and all interest accrued thereon,
shall be returned to Buyer. In the event of Buyer's default under this
Agreement, Seller shall have as its sole remedy the right to terminate this
Agreement and retain the Deposit, together with accrued interest thereon, as
liquidated damages.
3. CONTINGENCIES. Buyer's obligation to purchase the Property is subject
to Buyer's satisfaction or waiver, in writing, of the following conditions
precedent, in Buyer's sole and absolute discretion, on or before the dates
described below:
3.1 PRELIMINARY TITLE INSURANCE COMMITMENT. By no later than March 20,
1998, Seller shall provide Buyer with a current preliminary commitment for
owner's title insurance with extended coverage (ALTA Form 1970-B, as revised in
1984 or if unavailable, Form B-1987) issued by the Closing Agent, with copies
of all documents listed as exceptions set forth therein
3.2 ALTA/ACSM Survey. As soon as possible but no later than March 20,
1998, Seller, at its sole expense, shall deliver to Buyer a new ALTA/ACSM survey
with land area certification of the Property and a parcel map.
3.3 TITLE AND SURVEY APPROVAL PERIODS. Buyer shall have five (5) days
from the later receipt of either the preliminary commitment or the final (not
preliminary) survey (and any amendments, supplements and revisions to either in
which new or revised exceptions or items first appear) to notify Seller of its
disapproval of or questions about any exceptions shown in the preliminary
commitment or any items on the survey. If, within two (2) days after the
receipt of such notice Seller has not removed or given reasonable written
assurances to Buyer that such disapproved exceptions or items will be removed on
or before closing, Buyer may, at its option, at any time prior to such removal
or receipt of such reasonable written assurances, terminate this Agreement by
giving notice of such termination to Seller. On such termination Closing Agent
shall refund the Deposit and all interest accrued thereon to Buyer and all
rights and obligations of Seller and Buyer under this Agreement shall terminate
and be of no further force or effect.
3.4 SITE SUITABILITY. Buyer's determination that the Property is
feasible in all respects for Buyer's intended use, including but not limited to,
the following; determining that Buyer's selected building configuration plan can
be satisfactorily adapted to the site; Buyer's proposed parking plan, on site
vehicle and pedestrian circulation plan and street access plan for the Property
all meet or exceed Buyer's minimum criteria; and that the local governmental
requirements for landscaping, open area, building to land ratio and set-backs
can be satisfied as shown on Exhibit A; and that utilities will be available of
adequate capacity to serve Buyer's needs.
3.5 STUDIES. Satisfactory results of all soils, engineering,
environmental, topography, hazardous waste, geotechnical, hydrology, wetlands
and other studies that may be deemed necessary by Buyer or required by any
governmental agency in connection with the Property and Buyer's planned
development and use of the Property. Seller represents that it has delivered to
Buyer all information regarding the Property contained in Seller's files or
available to Seller from the current owners of the Property or otherwise and,
more specifically, any material, data, filings, applications, P.U.D.
information, wetlands mitigations, topographic surveys, soils tests,
environmental assessments, environmental remediation and other information or
data with respect to the Property which will assist Buyer in its determination
of the suitability of the Property for an Eagle Hardware & Garden store.
3.6 APPROVALS AND PERMITS. Issuance of any and all governmental
approvals and permits including but not limited to; (i) a replat and/or parcel
consolidation consolidating all the parcels into one parcel as required for
issuance of the building permit and for recording at Closing; (ii) lot line
adjustment of the Property as described in Section 4 below; (iii) California
Department of Transportation highway access and traffic signal approvals; (iv)
City and/or County building permits, use permits, sign permits, design review
approvals, site plan approvals, parking variances and approvals of any kind from
any and all governmental agencies having jurisdiction over the Property,
necessary for Buyer to develop and construct it's store building, garden yard
and greenhouse and any other improvements that Buyer deems necessary in its sole
determination to conduct its selected business operations on the Property in the
configuration as shown on Exhibit A. The timing, conditions and cost of the
permits and approvals (including any mitigation fees) must be acceptable to
Buyer.
3.7 ENVIRONMENTAL DECLARATION. Seller represents that it has provided
to Buyer all available environmental materials including but not limited to
Phase I and Phase II reports. Buyers shall approve or disapprove the
environmental materials during the Contingency Period, however, Seller shall
make no representations or warranties in regards to the environmental materials
provided to Buyer.
2
3.8 TIME PERIODS. Buyer shall have until March 30, 1998 (the,
"Contingency Period") to satisfy or waive the contingencies set forth in
Sections 3.4, 3.5, 3.6 and 3.7. If Buyer does not satisfy or waive the
contingencies in writing by such date, or if Buyer notifies Seller in writing at
any time prior to the end of the Contingency Period that it has decided not to
pursue the project any further and that this Agreement is terminated, the
Deposit, with interest, shall be refunded to Buyer and the Agreement shall
terminate without further action and be of no further force or effect.
4. GAS STATION PARCEL.
4.1 LOT LINE ADJUSTMENT. The current owner of the gas station land
located on Carmenita Avenue, consisting of approximately 0.7 acres (the "Gas
Station Parcel") shall retain title thereto. Seller acknowledges and agrees that
Seller shall, at Seller's sole cost and expense, process a lot line adjustment
and/or parcel map, if required ("Lot Line Adjustment"), to adjust the property
line of the Gas Station Parcel in accordance with all applicable subdivision
laws so that the Gas Station Parcel shall be configured approximately as shown
on Exhibit A and so that the Gas Station Parcel, as so reconfigured, shall
contain approximately 50,000 square feet of gross land area, or 1.15 acres.
4.2 TEMPORARY EASEMENT. In the event the Lot Line Adjustment is not in
a position to record concurrently with the Closing, then Seller shall retain an
exclusive easement on terms and conditions satisfactory to Seller and Buyer over
that portion of the Property which will be the subject of the Lot Line
Adjustment, which such easement shall be appurtenant to the Gas Station Parcel.
Buyer shall grant to Seller concurrently with the Closing an option to purchase
the easement area for the sum of $10.00 at such time as the Lot Line Adjustment
has been approved and may be recorded. The option to purchase shall be evidenced
by a memorandum of such option which shall be recorded concurrently with the
Closing. Seller shall continue to process such Lot Line Adjustment, following
the close of escrow, at its sole cost and expense, and if Seller shall fail to
do so, Buyer may process such parcel Lot Line Adjustment for and on the account
of Seller and Seller shall reimburse Buyer for all losses, costs and expenses
incurred by Buyer in so doing. Buyer covenants and agrees to execute all
documents required in connection therewith.
5. CLOSING.
5.1 TIME FOR CLOSING; TERMINATION DATE. This sale shall be closed in
the office of the Closing Agent on April 1, 1998 provided that all of Buyer's
conditions precedent have been satisfied or waived by Buyer. Buyer and Seller
shall deposit in escrow with Closing Agent all instruments, documents and monies
necessary to complete the sale in accordance with this Agreement. As used
herein, "Closing" or "date of closing" means the date on which all appropriate
documents are recorded and proceeds of sale are available for disbursement to
Seller. Funds held in reserve accounts pursuant to escrow instructions shall be
deemed, for purposes of this definition, as available for disbursement to
Seller.
5.2 ACCEPTANCE OF EXCEPTIONS. Neither Seller nor Buyer shall be
required to close, and the Deposit and all interest thereon shall be returned
to Buyer, if any exception or item disapproved by Buyer as herein provided
cannot be removed by the date of closing; provided, however, that Buyer may
elect to waive any disapproved exceptions or items and close on the remaining
terms. Notwithstanding the foregoing, Seller shall remove any defect or
encumbrance attaching by, through or under Seller after the Effective Date of
this Agreement. Exceptions to be discharged by Seller may be paid out of the
purchase price at closing.
3
5.3 PRORATIONS; CLOSING COSTS. Taxes and assessments for the current
year and utilities constituting liens shall be prorated as of the, date of
closing. Seller shall pay the standard portion of the premium for the title
insurance policy, real estate excise, transfer and/or conveyance taxes, the cost
of conveyance tax stamps, if any, and one-half of Closing Agent's escrow fee.
Buyer shall pay the cost of recording the deed, one-half of Closing Agent's
escrow fee, and the difference in the cost of the premium between standard
owner's and extended coverage
5.4 POSSESSION. Buyer shall be entitled to possession upon closing.
6. CONVEYANCE OF TITLE.
6.1 Deed. On closing, Seller shall execute and deliver to Buyer a
grant deed conveying good and marketable title to the Property free and clear of
any defects or encumbrances except for the lien of real estate taxes for the
current calendar year not yet due and payable, those defects or encumbrances
appearing on the preliminary commitment for title insurance that are approved by
Buyer (the "Permitted Exceptions"), and other encumbrances or defects approved
by Buyer in writing.
6.2 TITLE INSURANCE. As soon as available after closing,, Seller shall
provide to Buyer a policy of title insurance pursuant to the preliminary
commitment, dated as of the closing date and insuring Buyer in the amount of the
purchase price against loss or damage by reason of defect in Buyer's title to
the Property subject only to the printed exclusions and general exceptions
appearing in the policy form; any Permitted Exceptions; the exceptions specified
in the preliminary commitment which Buyer has not disapproved of as provided
herein; and real property taxes and assessments that are not delinquent.
7. RISK OF LOSS AND CONDEMNATION.
7.1 RISK OF LOSS. Risk of loss of or damage to the Property shall be
borne by Seller until the date of closing. Thereafter, Buyer shall bear the risk
of loss. In the event of material loss of or damage to the Property prior to the
date upon which Buyer assumes the risk, Buyer may terminate this Agreement by
giving notice, of such termination to Seller and Closing Agent, and such
termination shall be effective and the Deposit and interest thereon shall be
refunded ten (10) days thereafter; provided, however, that such termination
shall not be effective if Seller agrees in writing within such ten (10) day
period to restore the Property substantially to its present condition by the
closing date.
7.2 CONDEMNATION. If the Property is or becomes the subject of a
condemnation proceeding prior to closing, Buyer may, at its option, terminate
this Agreement by giving notice of such termination to Seller, and upon such
termination the Deposit and accrued interest shall be returned to Buyer and this
Agreement shall be of no further force or effect; provided, however, that Buyer
may elect to purchase the Property, in which case the total purchase price shall
be reduced by the total of any condemnation award received by Seller. On
closing, Seller shall assign to Buyer all of Seller's rights in and to any
future condemnation awards or other proceeds payable or to become payable by
reason of any taking. Seller agrees to notify Buyer of eminent domain
proceedings within five (5) days after Seller learns thereof.
8. SELLER'S REPRESENTATIONS AND WARRANTIES. Buyer acknowledges that
Seller does not presently hold title and has no operating history on the
Property. Notwithstanding, in addition to other representations herein, Seller
represents and warrants to Buyer as of the date of closing that:
8.1 Seller has full power and authority to execute this Agreement and
perform Seller's obligations and duties hereunder;
4
8.2 To the best of Seller's knowledge, the Property is not subject to
any leases, tenancies or rights of persons in possession;
8.3 To the best of Seller's knowledge, neither the Property nor the
sale, of the Property violates any applicable statute, ordinance or regulation,
nor any order of any court or any governmental authority or agency, pertaining
to the Property or the use occupancy or condition thereof;
8.4 Seller is unaware of any material defect in the Property;
8.5 To the best of Seller's knowledge, all persons and entities
supplying labor, materials and equipment to the Property have been paid and
there are no claims or liens;
8.6 To the best of Seller's knowledge, there are no currently due and
payable assessments for public improvements against the Property and Seller is
not aware of any local improvement district or other taxing authority having
jurisdiction over the Property in the process of formation;
8.7 To the best of Seller's knowledge, the Property has legal access
to all streets adjoining the Property;
8.8 Seller will have good and marketable title to the Property at
Closing;
8.9 Seller is not a "foreign person" for purposes of Section 1445 of
the Internal Revenue Code. Prior to closing, Seller shall execute and deliver to
Closing Agent an affidavit in order to meet the Foreign Investment in Real
Property Tax Act ("FIRPTA") requirements of I.R.C. # 1445; and
8.10 Seller has not received notification of any kind from any agency
suggesting that the Property is or may be targeted for a Superfund or similar
type of cleanup. To the best of Seller's knowledge, neither the Property nor any
portion thereof is or has been used (i) for the storage, disposal or discharge
of oil, solvents, fuel, chemicals or any type of toxic or dangerous or hazardous
waste or substance, (ii) as a landfill or waste disposal site, and (iii) does
not contain any underground storage tanks, except as disclosed in a Phase I
Environmental Assessment Report dated October 3, 1997, and the Site Assessment
Report dated February 4, 1998, both prepared by Xxxx Environmental Management,
Inc. Seller agrees to indemnify, defend and hold Buyer harmless from and against
any and all loss, damage, claims, penalties, liability, suits, costs and
expenses (including, without limitation, reasonable attorneys' fees) and also
including without limitation, costs of remedial action or cleanup, suffered or
incurred by Buyer arising out of or related to any such use of the Property, or
portion thereof, occurring prior to the conveyance to Buyer, about which Seller
knew or reasonably should have known prior to Closing and did not disclose to
Buyer.
8.11 At Closing, Buyer shall be entitled to the benefit of any and all
representations, warranties, guarantees and other assurances made or given to
Seller by the current owners of the Property and any other third parties
including, but not limited to, surveyors, engineers and environmental
consultants.
9. BUYER'S AUTHORITY. Buyer represents and warrants to Seller that at the
date of execution hereof and at the date of closing Buyer, and the person
signing on behalf of Buyer, has full power and authority to execute this
Agreement and to perform Buyer's obligations hereunder.
5
10. DEFAULT. If Seller defaults hereunder, Buyer may seek specific
performance of this Agreement, damages or rescission and Buyer shall be
entitled to return of the Deposit with accrued interest, on demand. If Buyer
defaults, the Deposit and accrued interest shall be forfeited to Seller as
liquidated damages and as Seller's sole and exclusive remedy and upon payment
thereof to Seller, Buyer shall have no further obligations or liability
hereunder. If any legal action or other proceeding is brought for the
enforcement of this Agreement, or because of an alleged dispute, breach,
default or misrepresentation in connection with any of the provisions of this
Agreement, the successful or prevailing party or parties shall be entitled to
recover reasonable attorneys' fees and other costs incurred in that action or
proceeding, in addition to any other relief to which it or they may be
entitled. If any party makes a written settlement offer which is not accepted
by the other party, then if the amount recovered by such other party is less
than the amount of the settlement offer, the party making the settlement
offer shall be considered the prevailing party.
11. NOTICES. All notices, waivers, elections, approvals and demands
required of permitted to be given hereunder shall be in writing and shall be
personally delivered (by overnight courier service or other means of personal
service) or sent by United States certified mail, return receipt requested, to
the addressee's mailing address set forth on the signature page:
and, in the case of Buyer, a copy to: Xxxxxxx X. Xxxxxxx
0000 XX Xxxx Xx.
Xxxxxxxxxx Xxxxxx, XX 00000
and, in the case of Seller, a copy to:
----------------------------
----------------------------
----------------------------
----------------------------
Either party hereto may, by proper notice to the other, designate any other
address for the giving of notice. Any notice shall be effective when personally
delivered or, if mailed as provided herein, on the date of actual receipt.
12. CONFIDENTIALITY. Except for communications with the current
owners of the Property, the City of Norwalk, experts, partners and lenders,
Seller agrees not to directly or indirectly, through agents or otherwise,
provide any information about the Property and/or the sale of the Property or to
discuss any of the terms of this Agreement and the timing of the project or any
other items regarding the transaction with any other person or entity unless and
until Buyer notifies Seller in writing that the transaction cannot be
consummated
13. NO NEGOTIATIONS WITH THIRD PARTY. Seller shall not negotiate nor
commit to sell, lease or otherwise transfer the Property on any portion thereof
to any other person or party as long as Buyer is proceeding in good faith to
perform its duties under this Agreement. This covenant shall remain in full
force and effect and be legally binding upon Seller until termination of this
Agreement.
14. GENERAL. This is the entire agreement of Buyer and Seller with
respect to the matters covered hereby and supersedes all prior agreements
between them, written or oral. This Agreement may be modified only in writing,
signed by Buyer and Seller. Any waivers hereunder must be in writing. No waive
of any right or remedy in the event of default hereunder shall constitute a
waiver of such right or remedy in the event of any subsequent default. This
Agreement is for the benefit only of the parties hereto and shall inure to the
benefit of and bind the heirs, personal representatives, successors and assigns
of the parties hereto. The invalidity or unenforceability of any provision of
this Agreement shall not affect the validity or enforceability of any other
provision hereof. If the date for performance or giving notice under this
Agreement is a Saturday, Sunday or banking holiday in California, the date for
performance or notice shall be extended until the next day that is not a
Saturday, Sunday or banking holiday.
6
15. SURVIVAL OF WARRANTIES. The terms, covenants, representations and
warranties shall not merge in the deed of conveyance, but shall survive closing.
16. COMMISSIONS. All real Estate commissions and/or broker's fees
shall be, payable by Seller at Closing to Majestic Realty (the "Broker"). Said
commission and/or broker's fee shall be as agreed upon in a separate agreement
between Seller and the Broker. Said agreement shall hold Buyer harmless from any
obligation for payment of any real estate commissions and/or broker's fees and
shall survive closing.
17. EXHIBITS. Exhibits A and B attached hereto are incorporated herein
as if fully set forth
Exhibit A - SIRE PLAN
Exhibit B - Legal Description of the Property
18. EFFECTIVE DATE. The later of the Buyer's signature date and the
Seller's signature date, set forth below, shall be the "Effective Date" of this
Agreement.
BUYER: EAGLE HARDWARE & GARDEN, INC.
By: /s/ Xxxxxxx X. Xxxxxx
---------------------------
Typed name: Xxxxxxx X. Xxxxxx
March 16 ,1998 Its: President and C.E.O.
----------------------
Buyer's signature date
Address: 000 Xxxxxx Xxxxxx X.X.
Xxxxxx, XX 00000
SELLER: XXXXXXX REAL ESTATE GROUP
March 17 ,1998 By: /s/ Xxxxxxx X. Xxxxxxx
----------------------- ---------------------------
Seller's signature date Typed name Xxxxxxx X. Xxxxxxx
------------------
Its: President
------------------
Address: #00 Xxxxxxxxx Xxxxx
Xxxxx 000
Xxxxxxx Xxxxx, XX 00000
7
EXHIBIT "A"
[MAP]
EXHIBIT "B"
LEGAL DESCRIPTION OF THE PROPERTY
EXHIBIT "B"
