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EXHIBIT 2.3
AGREEMENT OF PURCHASE AND SALE
AND JOINT ESCROW INSTRUCTIONS
This Agreement of Purchase and Sale and Joint Escrow Instructions
("AGREEMENT") is dated for reference purposes only as of the 1st day of
December, 1998, and made and entered into by and between Children's
Comprehensive Services of California, a California corporation ("BUYER"), and
BMB Enterprises, a California general partnership ("SELLER"), with respect to
the following:
RECITALS
A. Seller desires to sell and convey to Buyer all of Seller's right,
title and interest in and to the following:
(1) That certain real property located at 00000 Xxx Xxxxx Xxxxxxxxx,
in the City of Riverside, County of Riverside, State of California, consisting
of approximately 1.38 acres of land, which is depicted on Exhibit "A" attached
hereto ("LAND") and more particularly described on Exhibit "B" attached hereto,
and all improvements located thereon ("IMPROVEMENTS");
(2) All rights, privileges, easements, and appurtenances benefiting
the Land and the Improvements, including, without limitation, all mineral and
water rights and all easements, rights-of-way and other appurtenances used or
connected with the beneficial use or enjoyment of the Land and the Improvements
(the Land, the Improvements and all such rights, privileges, easements and
appurtenances are sometimes collectively hereinafter referred to as the "REAL
PROPERTY"); and
(3) All of Seller's interest in any intangible property used or
useful in connection with the foregoing, including, without limitation, all
"LEASES," "IMPROVEMENT PLANS" and "CONTRACTS" (as those terms are defined in
Paragraphs 7.1.2(ii) and (iii), respectively, hereof), contract rights,
warranties, guaranties, licenses, permits, entitlements, governmental approvals,
and certificates of occupancy which benefit the Real Property ("INTANGIBLE
PERSONAL PROPERTY") (with the Real Property and the Intangible Personal Property
sometimes collectively hereinafter referred to as the "PROPERTY").
B. Seller desires to sell the Property to Buyer, and Buyer desires to
purchase, the Property from Seller upon the terms and conditions hereinafter set
forth.
NOW, THEREFORE, in consideration of the mutual covenants and agreements
herein contained and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Seller and Buyer agree that the
terms and conditions of this Agreement and the instructions to Chicago Title
Company ("ESCROW HOLDER") with regard to the escrow ("ESCROW") created pursuant
hereto are as follows:
1. Purchase and Sale. Seller hereby agrees to sell the Property
to Buyer, and Buyer hereby agrees to purchase the Property from Seller, upon the
terms and conditions herein set forth.
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2. Purchase Price. The purchase price ("PURCHASE PRICE") for
the Property shall be Two Million Five Hundred Thousand Dollars ($2,500,000)
plus an amount (the "PAYOFF AMOUNT") equal to the total sums required to pay off
all outstanding principal and accrued interest under that certain promissory
note in the original amount of $1,056,000 between Seller and Provident Savings
Bank, FSB dated September 13, 1994 (the "INDEBTEDNESS"), secured by that certain
deed of trust between Seller as trustor and Provident Financial Savings Bank,
FSB, as beneficiary, dated September 13, 1994, and recorded September 29, 1994,
as document number 377621 (the "EXISTING TRUST DEED"), it being specifically
understood by the parties, however, that in no event shall such Payoff Amount
exceed the sum of One Million Dollars ($1,000,000).
3. Payment of Purchase Price. The Purchase Price for the
Property shall be payable by Buyer as follows:
3.1 Deposit. Upon "OPENING OF ESCROW" (as that term is
defined in Paragraph 4.1 hereof), Buyer will deposit with Escrow Holder, in cash
or by certified or bank cashier's check made payable to Escrow Holder, or a
confirmed wire transfer of funds (alternatively, "CASH"), the sum of One Hundred
Twenty-Five Thousand Dollars ($125,000) (the "DEPOSIT"). The Deposit shall be
invested by Escrow Holder in an interest bearing account acceptable to Buyer
with the Deposit and all interest accruing thereon credited to the Purchase
Price or released to Buyer at its election.
3.2 Real Estate Note and Deed of Trust. A purchase money
first deed of trust ("DEED OF TRUST") to record at "CLOSE OF ESCROW" (as that
term is defined in Paragraph 4.2 hereof), executed by Buyer securing a
promissory note ("REAL ESTATE NOTE") for Two Million Three Hundred Seventy-Five
Thousand Dollars ($2,375,000) in favor of Seller, or order, payable at Xxxx
Xxxxxx Xxx 0000, Xxxxxxxxx, Xxxxxxxxxx 00000, or at place designated by the
beneficiary, with interest from the date hereof at the rate of six percent
(6.0%) per annum, with principal and interest payable quarterly in arrears from
the date hereof and continuing quarterly thereafter for three (3) years, at
which time the unpaid principal balance and any accrued interest thereon shall
be due and payable in full. In addition to such quarterly payments of principal
and interest, if, in Buyer's good faith belief, Buyer is entitled to
indemnification, reimbursement, or payment from Seller hereunder or as provided
otherwise under the "STOCK PURCHASE AGREEMENT," (as that term is defined in
Paragraph 7.1, below) then in addition to any other remedies which Buyer may
have available to it, Buyer shall have the right to set off the entire amount
thereof against the amounts, if any, which Buyer shall owe at such time or from
time to time thereafter to Seller under the Real Estate Note. The Real Estate
Note shall be in the form of, and upon the terms contained in, Exhibit "C"
hereto. The Deed of Trust shall be in the form of, and upon the terms contained
in, Exhibit "D" hereto. At the Close of Escrow, the principal amount of the Real
Estate Note shall be applied and credited toward the payment of the Purchase
Price.
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3.3 Payoff Amount and Other Closing Funds. On or before the
Close of Escrow, Buyer shall deposit or cause to be deposited with Escrow
Holder, the Payoff Amount and an additional amount of Cash such that the sum of
the Deposit, the Real Estate Note, the Payoff Amount and such Cash equals the
Purchase Price plus Buyer's share of closing costs, prorations, and charges
payable pursuant to this Agreement and minus the amount of any payments by Buyer
for and on behalf of Seller of any of Seller's share of closing costs,
prorations, and charges payable pursuant to this Agreement.
4. Escrow.
4.1 Opening of Escrow. For purposes of this Agreement, the
Escrow shall be deemed opened on the date Escrow Holder receives a fully
executed original or originally executed counterparts of this Agreement from
both Buyer and Seller (such date being referred to hereinafter as the "OPENING
OF ESCROW"). Escrow Holder shall notify Buyer and Seller in writing of the date
Escrow is opened. Buyer and Seller agree to execute, deliver and be bound by any
reasonable or customary supplemental escrow instructions of Escrow Holder or
other instruments as may reasonably be required by Escrow Holder in order to
consummate the transaction contemplated by this Agreement. Any such supplemental
instructions shall not conflict with, amend or supersede any portions of this
Agreement, except as otherwise provided herein. If there is any conflict or
inconsistency between such supplemental instructions and this Agreement, then
this Agreement shall control.
4.2 Close of Escrow. For purposes of this Agreement, the
"CLOSE OF ESCROW" shall be the date that the grant deed, the form of which is
attached hereto as Exhibit "E" ("GRANT DEED"), conveying the Property to Buyer,
is recorded in the Official Records of Riverside County, California ("OFFICIAL
RECORDS"). Unless extended in writing by Buyer and Seller or unless extended
pursuant to the terms and provisions of Paragraph 7.1.2 hereof, the Close of
Escrow shall occur on the first business day following the satisfaction or
waiver of all conditions to the obligations of the parties to the Stock Purchase
Agreement ("CLOSING DATE"). Seller shall deliver possession of the Property to
Buyer upon the Close of Escrow, subject only to the "APPROVED CONDITION OF
TITLE" (as that term is defined in Paragraph 5 hereof).
5. Condition of Title. It shall be a condition to the Close of
Escrow for Buyer's benefit and a covenant of Seller that title to the Property
be conveyed to Buyer by Seller by the Grant Deed subject only to the following
approved condition of title ("APPROVED CONDITION OF TITLE"):
(a) a lien to secure payment of real estate taxes, not
delinquent;
(b) the lien of supplemental taxes assessed pursuant to
Chapter 3.5 commencing with Section 75 of the California Revenue and Taxation
Code ("CODE"), but only to the extent that such supplemental taxes are
attributable to the transaction contemplated by this Agreement. Seller shall be
responsible for, and shall indemnify, protect, defend (with counsel chosen by
Buyer) and hold harmless Buyer and the Property from and against any and all
supplemental taxes assessed pursuant to the Code, to the extent that such taxes
relate to events (including, without
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limitation, any changes in ownership and/or new construction) occurring on or
prior to the Close of Escrow;
(c) matters affecting the Property which are created by
or with the written consent of Buyer; and
(d) exceptions which are disclosed by the "REPORT" (as
that term is defined in Paragraph 7.1.1 hereof) and which are approved by Buyer
in accordance with said Paragraph 7.1.1 ("PERMITTED EXCEPTIONS").
Seller covenants and agrees that during the term of the
Escrow, it will not cause or permit title to the Property to differ from the
Approved Condition of Title described in this Paragraph 5. Any liens,
encumbrances, encroachments, easements, restrictions, conditions, covenants,
rights, rights-of-way, or other matters affecting the Approved Condition of
Title which may appear of record or be revealed after the date of the Report
shall also be subject to Buyer's approval and must be eliminated or ameliorated
by Seller to Buyer's sole, absolute, and subjective satisfaction prior to the
Close of Escrow.
6. Title Policy. Title shall be evidenced by the issuance by
Chicago Title Company in its capacity as title insurer ("TITLE COMPANY") of its
ALTA Extended Coverage (Form B-1970) Owner's Policy of Title Insurance ("TITLE
POLICY") in the amount of the Purchase Price, showing title to the Property
vested in Buyer or its title nominee as provided in Paragraph 20 hereof and
subject only to the Approved Condition of Title.
7. Conditions to Close of Escrow.
7.1 Conditions to Buyer's Obligations. The Close of Escrow
and Buyer's obligation to consummate the transaction contemplated by this
Agreement are subject to the satisfaction of the following conditions for
Buyer's benefit (or Buyer's written waiver thereof, it being agreed that Buyer
may waive in writing any or all of such conditions) on or prior to the dates
designated below for the satisfaction of such conditions. Notwithstanding
anything in this Agreement to the contrary, it is expressly agreed by and
between the parties that Buyer's obligation to consummate the transactions
contemplated by this Agreement shall be subject to the satisfaction of all
conditions to the obligations of the parties set forth in that certain Stock
Purchase Agreement ("STOCK PURCHASE AGREEMENT"), dated currently herewith, by
and between Buyer on the one hand and Xxxxxxx X. Xxxxx, Xxxxxx X. Xxxxx, Xxxxxx
X. XxXxx, and Somerset, Incorporated, a California corporation, on the other
hand.
In the event that Buyer terminates this Agreement
pursuant to the terms of this Paragraph 7.1, or Buyer terminates the Stock
Purchase Agreement pursuant to Article X thereof, or Buyer disapproves any of
the matters set forth in this Paragraph 7.1, or one or more of the following
conditions to Buyer's obligations to acquire the Property has not been satisfied
or waived on or before the Close of Escrow, the Escrow created pursuant hereto
shall terminate and Buyer shall be entitled to the return of the Deposit
together with all interest accrued thereon.
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7.1.1 Title. Buyer shall have approved the legal
description of the Land and any matters of title as disclosed by the following
documents (collectively, "TITLE DOCUMENTS"), which are to be obtained by Seller
or Buyer and delivered to Buyer; all at Seller's sole cost and expense: (A) a
standard preliminary title report issued by Title Company with respect to the
Real Property, as such report may be amended or supplemented from time to time
to reflect additional title matters or survey exceptions ("REPORT"); (B) legible
copies of all documents, whether recorded or unrecorded, referred to in the
Report; and (C) an ALTA survey of the Real Property prepared by a licensed
engineer or surveyor acceptable to Buyer in Buyer's sole discretion ("SURVEY").
Buyer acknowledges that Buyer has received the Title Documents.
Buyer shall have until the expiration of the
Contingency Period (defined below) to give Seller and Escrow Holder written
notice ("BUYER'S TITLE NOTICE") of Buyer's disapproval or conditional approval
of the legal description or any matters shown in or disclosed by the Title
Documents.
If Buyer disapproves or conditionally approves
any of the foregoing matters, Seller may, within five (5) calendar days after
its receipt of Buyer's Title Notice, elect to eliminate or ameliorate to Buyer's
sole satisfaction such disapproved or conditionally approved matters. Within
such five (5) calendar day period, Seller shall give Buyer written notice (which
shall hereinafter be referred to as "SELLER'S TITLE NOTICE") of those
disapproved or conditionally approved matters, if any, which Seller covenants
and agrees to either eliminate from the Title Policy as exceptions to title to
the Property or to ameliorate to Buyer's satisfaction by the Closing Date as a
condition to the Close of Escrow for Buyer's benefit. If Seller does not elect
in Seller's Title Notice to eliminate or ameliorate any disapproved or
conditionally approved matters as provided above, or if Buyer disapproves, in
Buyer's discretion, Seller's Title Notice, then Buyer shall have the right, by a
writing delivered to Seller and Escrow Holder prior to the Closing Date, to: (A)
waive its prior disapproval, in which event said disapproved matter(s) shall be
deemed Permitted Exceptions, or (B) terminate this Agreement and the Escrow
created pursuant hereto and the Deposit and all interest earned thereon shall be
returned to Buyer. Notwithstanding anything to the contrary contained in this
Agreement, Buyer hereby disapproves all liens evidencing monetary encumbrances
(other than liens for non-delinquent real property taxes and the Indebtedness)
and Seller agrees to cause all such liens (other than liens for non-delinquent
real property taxes and the Indebtedness) to be eliminated at Seller's sole cost
and expense (including all prepayment penalties and charges) prior to or
concurrently with the Close of Escrow.
7.1.2 Review and Approval of Documents and Materials.
Seller shall have delivered or caused to be delivered to Buyer on or before the
opening of Escrow the documents and materials respecting the Property set forth
below which are in Seller's possession or control or are reasonably available to
Seller ("DOCUMENTS AND MATERIALS"). From the Opening of Escrow until and up
through the Closing ("CONTINGENCY PERIOD"), Buyer shall have the right to review
and approve or disapprove, in its sole and absolute discretion, any or all of
the Documents and Materials.
(i) Leases. Copies of any and all leases and
amendments thereto, with respect to the Property ("LEASES") and copies of any
and all documents, agreements, and other writings referenced therein affecting
the Leases
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(ii) Zoning Compliance; Permits. Evidence that
the Property complies with any and all applicable governmental ordinances, rules
and regulations, including, but not limited to, zoning and building regulations,
and any and all other governmental approvals (such as approved building permits,
building inspection approvals) and/or authorizations pertaining to the Property
(collectively "PERMITS").
(iii) Improvement Plans. Complete "as-built"
plans, drawings and specifications, if any, relating to all of the Improvements
(collectively "IMPROVEMENT PLANS");
(iv) Agreements. Legible copies of any and all
insurance policies, construction contracts, reciprocal easement agreements, if
any, utility will-serve letters and any other contracts or agreements affecting
or relating to the ownership, operation, maintenance, construction or
development of the Property, (collectively, "CONTRACTS");
(v) Schedule of Expenses. A schedule
reflecting any and all expenses for the ownership, operation, and maintenance
and repair of the Property for twelve (12) month period ended December 31, 1997,
and for the eleven (11) month period ended November 30, 1998, which schedule
shall include, without limitation: (1) annual insurance premiums for all forms
of coverage; (2) real property taxes and assessments; and (3) utility charges,
management fees, and maintenance and repair costs;
(vi) Tax Statements. Legible copies of the
bills for all real property taxes, assessments or other charges and all personal
property taxes payable with respect to the Property, or any portion thereof for
the past three (3) tax years;
(vii) Soils and Engineering Reports. All
existing and available soils, environmental and building reports and engineering
data pertaining to the Real Property or any portion thereof and any and all
architectural studies, grading plans, topographical maps and similar data
respecting the Real Property;
(viii) Maps. Any and all tentative, parcel
and/or final maps and any other governmental approved or processed documents
relative to the subdivision of the Land ("MAPS");
(ix) Miscellaneous. Such other documents in
Seller's possession or control which relate to the Property which Buyer shall
request.
7.1.3 Inspections and Studies. On or before the
expiration of the Contingency Period, Buyer shall have the right to approve or
disapprove, in Buyer's sole discretion, the results of any and all inspections,
surveys, investigations, tests and studies, including, without limitation,
investigations with regard to zoning, building codes and other governmental
regulations, architectural inspections, engineering tests, economic feasibility
studies and soils, seismic and geologic reports, as well as toxic and
environmental studies and reports with respect to the Property, inspections and
surveys of all or any portion of the Improvements (including, without
limitation,
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public utilities), and any other physical inspections and/or investigations as
Buyer may elect to make or obtain.
During the term of this Escrow, Buyer shall be afforded
access by Seller to review Seller's books and records relating to the Property,
and Buyer, its agents, consultants, contractors and subcontractors shall have
the right to enter upon the Property to conduct or make any and all inspections,
surveys and tests (including, without limitation, soil and environmental
assessments of the Real Property) as may be necessary or desirable in Buyer's
sole discretion.
7.1.4 Representation, Warranties, and Covenants of Seller.
Seller shall have duly performed each and every covenant and agreement to be
performed by Seller pursuant to this Agreement and Seller's representations,
warranties, and covenants set forth herein shall be true and correct as of the
Closing Date.
7.1.5 No Material Changes. At the Closing Date, there shall
have been no material changes in the physical or financial condition of the
Property from and after the Opening of Escrow.
7.2 Condition to Seller's Obligations. For the benefit of Seller,
the Close of Escrow shall be conditioned upon the performance by Buyer of all of
the obligations required by the terms of this Agreement to be performed by Buyer
(or Seller's waiver thereof, it being agreed that Seller may waive such
condition).
8. Deposits by Seller. At least one (1) business day prior to the
Close of Escrow, Seller shall deposit or cause to be deposited with Escrow
Holder the following documents and instruments:
(i) Grant Deed. The Grant Deed conveying the Real Property to
Buyer or its title nominee, as provided in Paragraph 20 hereof, duly executed as
appropriate by Seller, acknowledged and in recordable form in the form attached
hereto as Exhibit "E";
(ii) Reconveyance of the Existing Trust Deed. A Reconveyance
of the Existing Trust Deed (the "RECONVEYANCE") executed by Provident Savings
Bank, FSB, which Reconveyance Escrow Holder is instructed to record immediately
prior to recordation of the Grant Deed;
(iii) Leases. The original Leases;
(iv) Contracts. Any and all original contracts affecting the
maintenance, repair, improvement, and/or development of the Property approved by
Buyer in accordance with Paragraph 7.1.2 hereof ("CONTINUING CONTRACTS");
(v) Assignment of Contracts. An Assignment of Contracts
("ASSIGNMENT OF CONTRACTS"), duly executed by Seller, the form of which is
attached hereto as
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Exhibit "F", pursuant to which Seller assigns to Buyer all of Seller's right,
title, and interest in and to the Continuing Contracts;
(vi) Assignment of Leases. An Assignment of Leases
("Assignment of Leases"), duly executed by Seller, the form of which is attached
hereto as Exhibit "G," pursuant to which Seller assigns to Buyer all of Seller's
right, title, and interest in and to the Leases;
(vii) Transferor's Certification of Non-Foreign Status.
Transferor's Certification of Non-Foreign Status in the form attached hereto as
Exhibit "H", duly executed by Seller ("FIRPTA CERTIFICATE");
(viii) Permits, Entitlements and the Like. Originals and any
and all building and development permits, utility will serve letters, use
permits and other governmental approvals and/or entitlements relative to the
Property;
(ix) General Assignment. A General Assignment ("GENERAL
ASSIGNMENT"), duly executed by Seller, in the form attached hereto as Exhibit
"I", conveying all of Seller's right, title, and interest in and to the
Intangible Personal Property;
(x) Tenant Letter. A letter signed by Seller, addressed to
each of the Tenants advising the Lessees of the sale herein to Buyer and
directing that all future rent payments and other charges are to be forwarded to
Buyer at an address to be supplied by Buyer; and
(xi) Other Instruments. Such other instruments and documents
as may be required by Paragraphs 11 and 21.2 hereof.
9. Deposits by Buyer. Buyer shall deposit or cause to be deposited
with Escrow Holder the funds which are to be applied towards the payment of the
Purchase Price in the amounts and at the times designated in Paragraph 3 hereof
(as reduced by the prorations and credits hereinafter provided). In addition,
Buyer shall deposit with Escrow Holder prior to the Close of Escrow the
following documents and instruments:
(i) Assignment of Leases. A counterpart of the Assignment of
Leases duly executed by Buyer;
(ii) Assignment of Contracts. A counterpart of the Assignment
of Contracts duly executed by Buyer;
(iii) General Assignment. A counterpart of the General
Assignment, duly executed by Buyer;
(iv) Loan Documents. An original executed Real Estate Note and
Deed of Trust; and
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(v) Other Instruments. Such other instruments and documents as
may be required in Paragraphs 11 and 21.2 herein.
10. Costs and Expenses.
10.1 Seller's Expenses. Seller shall be responsible and pay for:
(a) the cost and expense of the Title Policy; (b) one-half of the cost and
expense of the ALTA Survey; (c) one-half of the cost and expense of the Phase I
Environmental Study; (d) one-half of the escrow fee of Escrow Holder; (e) all
documentary transfer taxes payable in connection with the recordation of the
Grant Deed (the amount of such transfer taxes shall not be posted on the Grant
Deed but shall be supplied by separate affidavit); and (f) Escrow Holder's
customary charges for document drafting, recording, and miscellaneous charges.
If, as a result of no fault of Buyer or Seller, Escrow fails to close, then
Seller shall pay all of Escrow Holder's fees and charges.
10.2 Buyer's Expenses. Buyer shall be responsible and pay for
one-half of: (a) the cost and expense of the ALTA Survey; (b) the Phase I
Environmental Study; and (c) the escrow fee of Escrow Holder.
11. Prorations. The following prorations between Seller and Buyer
shall be made by Escrow Holder computed as of the Close of Escrow:
11.1 Taxes. Real and personal property taxes and assessments on
the Property shall be prorated on the basis that Seller is responsible for (i)
all such taxes for the fiscal year of the applicable taxing authorities
occurring prior to the "CURRENT TAX PERIOD" (as that term is defined in this
Paragraph 11.1) and (ii) that portion of such taxes for the Current Tax Period
determined on the basis of the number of days which have elapsed from the first
day of the Current Tax Period to the Close of Escrow, inclusive, whether or not
the same shall be payable prior to the Close of Escrow. The term "CURRENT TAX
PERIOD" refers to the fiscal year of the applicable taxing authority in which
the Close of Escrow occurs. In the event that, as of the Close of Escrow, the
actual tax bills for the year or years in question are not available and the
amount of taxes to be prorated as aforesaid cannot be ascertained, then rates
and assessed valuation of the previous year, with known changes, shall be used,
and when the actual amount of taxes and assessments for the year or years in
question shall be determinable, then such taxes and assessments will be prorated
between the parties to reflect the actual amount of such taxes and assessments.
11.2 Rentals. Rentals and other payments (other than "PERCENTAGE
RENT" as that term is defined in Paragraph 11.3 hereof) and operating cost
pass-throughs) payable by Lessees, licensees, concessionaires, and other persons
using or occupying the Property or any part thereof, for or in connection with
such use or occupancy. However, Buyer shall not be obligated to make any payment
or give any credit to Seller on account of, or by reason of, any rental or other
payments which are unpaid as of the Closing Date, but shall be required merely
to turn over to Seller its share of the same if, as and when received by Buyer.
All payments (other than Percentage Rent and operating cost pass-throughs)
received by Buyer from a Lessee, licensee, concessionaire, or other person shall
be applied against the most recently accrued obligation or obligations of the
payor. Any rental payments received by Seller following the Closing Date shall
be paid over to Buyer unless the
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tenant has specified in writing that such payment relates to a rental period
occurring prior to the Closing Date.
11.3 Percentage Rent. "PERCENTAGE RENT" and operating cost pass-
throughs shall be prorated by Buyer and Seller outside of Escrow and delivered
to Escrow Holder.
11.4 Security Deposits. Buyer shall be credited and Seller shall
be charged with any security deposits and advanced rentals in the nature of
security deposits made by Lessees under the Leases as reflected in the Rent
Roll. Buyer shall also be credited and Seller shall be charged for all operating
cost pass-throughs paid by such Lessees and held by Seller in reserve for the
benefit of Lessees for the repair and/or improvement of the Property;
11.5 Utilities. Gas, water, electricity, heat, fuel, and other
utilities and the operating expenses relating to the Property shall be prorated
as of the Close of Escrow. If the parties are unable to obtain final meter
readings as of the Close of Escrow, then such expenses shall be estimated as of
the Close of Escrow on the basis of the prior operating history of the Property.
11.6 Insurance Premiums. Premiums on all existing insurance
policies if assigned to and accepted by Buyer.
At least one (1) business day prior to the Close of Escrow, the
parties shall agree upon all of the prorations to be made and submit a statement
to Escrow Holder setting forth the same. In the event that any prorations,
apportionments or computations made under this Paragraph 11 shall require final
adjustment, then the parties shall make the appropriate adjustments promptly
when accurate information becomes available and either party hereto shall be
entitled to an adjustment to correct the same. Any corrected adjustment or
proration shall be paid in cash to the party entitled thereto.
12. Disbursements and Other Actions by Escrow Holder. Upon the Close
of Escrow, Escrow Holder shall promptly undertake all of the following in the
following manner:
12.1 Prorations. Prorate all matters referenced in Paragraph 11
hereof based upon the statement (referenced in Paragraph 11 hereof) delivered
into Escrow signed by the parties.
12.2 Recording. Cause the Reconveyance, Grant Deed, the Deed of
Trust, and any other documents which the parties hereto may mutually direct, to
be recorded in the Official Records in the order directed by the parties.
12.3 Funds. Disburse from funds deposited by Buyer with Escrow
Holder towards payment of all items chargeable to the account of Buyer pursuant
hereto in payment of such costs and disburse the balance of such funds, if any,
to Buyer.
12.4 Notices. Mail the approved form of letter to Lessees
advising them of this transaction.
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12.5 Documents to Seller. Deliver to Seller the Real Estate Note
And counterparts of the Assignment of Leases, the Assignment of Contracts, and
the General Assignment executed by Buyer;
12.6 Documents to Buyer. Deliver to Buyer originals of the
Leases, FIRPTA Certificate, counterparts of the the Assignment of Leases,
Assignment of Contracts, and the General Assignment appropriately executed by
Seller, and any other documents which are to be delivered to Buyer hereunder,
and, when issued, the Title Policy to Buyer.
12.6 Title Policy. Direct the Title Company to issue the Title
Policy to Buyer.
13. Covenants of Seller. Seller hereby covenants with Buyer, as
follows:
13.1 No Further Contracts. From and after the date of this
Agreement, Seller shall not, without the prior written consent of Buyer, which
consent Buyer may withhold in its sole discretion, enter into any maintenance
contract, service contract or any other contract affecting or relating to the
Property which will survive the Close of Escrow or will otherwise affect the
use, operation or enjoyment of the Property after the Close of Escrow.
13.2 Insurance. All insurance policies carried by Seller with
respect to the Property and in effect as of the date of this Agreement shall
remain continuously in full force and effect from the date of this Agreement
through the day upon which the Close of Escrow occurs.
13.3 No Modification of Leases or Contracts. From and after the
date of this Agreement, Seller shall not amend, modify, alter or supplement any
Lease or Contract which is approved by Buyer pursuant to Paragraph 7.1.2 hereof.
Further, Seller hereby covenants and agrees that it shall terminate on or before
the Close of Escrow any Lease or Contract which Buyer disapproves in accordance
with Paragraph 7.1.2 hereof.
13.4 Operation of Property. From the date of this Agreement until
the Close of Escrow, Seller hereby covenants and agrees that it shall (i)
operate and manage the Property in a first-class manner, and (ii) maintain the
Property in good condition, repair and working order and in accordance with all
applicable laws, ordinances, rules, and regulations affecting the Property. All
Intangible Personal Property shall be conveyed to Buyer by Seller at the Close
of Escrow free from any liens, encumbrances, or security interests of any kind
or nature.
13.5 No Further Encumbrance. After the date of this Agreement,
Seller shall not alienate, lien, encumber, or otherwise transfer all or any
portion of the Property (other than to Buyer at the Close of Escrow).
13.6 Notification. Seller shall promptly notify Buyer of any
change in any condition with respect to the Property or of any event or
circumstance which makes any representation or warranty of Seller to Buyer under
this Agreement materially untrue or misleading,
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and of any covenant of Seller under this Agreement which Seller will be
incapable of performing or less likely to perform.
13.7 Indemnification Re Encroachment. Seller hereby acknowledges
that the Survey has revealed a 3.3-foot encroachment (the "ENCROACHMENT") onto
real property located directly to the east of the Land by the retaining wall
(the "RETAINING WALL") currently located on the east side of the Land. Seller
hereby agrees, after the Close of Escrow, at its sole cost and expense, to
indemnify, protect, defend (with counsel of Buyer's choice), and hold Buyer, its
successors and assigns, partners, shareholders, officers and/or directors, from
and against any and all claims, demands, losses, liabilities, all reasonable
costs associated with the removal and/or reconstruction of the Retaining Wall,
obligations, penalties, fines, actions, causes of action, judgments, suits,
proceedings, costs, disbursements and expenses (including, without limitation,
attorneys' and experts' reasonable fees and costs) of any kind or nature
whatsoever which may at any time be imposed upon, incurred or suffered by, or
asserted or awarded against, Buyer, or its successors and assigns, partners,
shareholders, officers and/or directors relating to or arising from the
existence of the Encroachment.
Notwithstanding anything in this Agreement to the contrary,
this indemnification regarding the Encroachment shall survive the Close of
Escrow and the recordation of the Grant Deed in perpetuity.
14. Seller's Representations and Warranties. In consideration of
Buyer entering into this Agreement and as an inducement to Buyer to purchase the
Property, Seller makes the following representations and warranties, each of
which is material and is being relied upon by Buyer (and the continued truth and
accuracy of which shall constitute a condition precedent to Buyer's obligations
hereunder):
14.1 Authorization.
(i) Seller has the legal power, right, and authority to
enter into this Agreement and the instruments referenced herein, and to
consummate the transactions contemplated hereby.
(ii) All requisite action has been taken by Seller in
connection with the entering into of this Agreement, the instruments referenced
herein, and the consummation of the transaction contemplated hereby. No consent
of any partner, shareholder, trustee, trustor, beneficiary, creditor, investor,
judicial or administrative body, governmental authority or other party is
required.
(iii) The individuals executing this Agreement and the
instruments referenced herein for and on behalf of Seller and the
partners of Seller, if any, have the legal power, right, and actual authority to
bind Seller to the terms and conditions hereof and thereof.
(iv) This Agreement and all documents required hereby
to be executed by Seller are and shall be valid, legally binding obligations of
and enforceable against Seller in accordance with their terms.
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(v) Neither the execution and delivery of this
Agreement and the documents and instruments referenced herein, nor the
incurrence of the obligations set forth herein, nor the consummation of the
transaction contemplated herein, nor compliance with the terms of this Agreement
and the documents and instruments referenced herein conflict with or result in
the material breach of any terms, conditions or provisions of, or constitute a
default under, any bond, note, or other evidence of indebtedness or any
contract, indenture, mortgage, deed of trust, loan, partnership agreement, lease
or other agreement or instrument to which Seller is a party or affecting the
Property.
14.2 Threatened Actions. There are, and at the Close of
Escrow there will be, no pending actions, suits, arbitrations, claims or
proceedings, at law, in equity or otherwise, affecting, or which may affect, the
Leases or all or any portion of the Property or in which Seller is or will be a
party by reason of Seller's ownership of the Property or interest in the Leases,
including, but not limited to, judicial, municipal or administrative proceedings
in eminent domain, collection actions, alleged building code violations, health
and safety violations, federal, state or local agency actions regarding
environmental matters, federal environmental protection agency or zoning
violations, employment discrimination or unfair labor practices, or worker's
compensation, personal injuries or property damages alleged to have occurred at
the Property or by reason of the condition or use of or construction on the
Property. Seller is not aware of the existence of any threatened or contemplated
actions, claims or proceedings or of the existence of any facts which might give
rise to any such actions, claims or proceedings.
14.3 Compliance with Law. All applicable laws, ordinances,
rules, requirements, regulations, building codes and environmental rules of any
governmental agency, body or subdivision thereof bearing on the Property and the
construction of the Improvements have been complied with.
14.4 Agreements. There are no agreements (whether oral or
written), affecting or relating to the right of any party with respect to the
possession of the Property, or any portion thereof, which are obligations which
will affect the Property or any portion thereof subsequent to the recordation of
the Grant Deed, except as set forth in the Contracts provided to and approved by
Buyer in accordance with Paragraph 7.1.2 hereof, or as may be reflected in the
Approved Condition of Title.
14.5 Documents True. All documents delivered by Seller to
Buyer pursuant to this Agreement are true, accurate, correct and complete copies
of originals and any and all information prepared by Seller or at Seller's
direction and supplied to Buyer by Seller in accordance with Paragraph 7.1.2
hereof are true, accurate, correct and complete.
14.6 Contracts. There are no maintenance contracts, service
contracts or any other contracts (whether oral or written) affecting or relating
to the Property which will survive the Close of Escrow except as set forth in
the Contracts provided to and approved by Buyer in accordance with Paragraph
7.1.2 hereof. At the Close of Escrow, there will be no outstanding contracts
entered into by Seller for the construction or repair of any improvements to the
Real Property which have not been fully paid for, and Seller shall cause to be
discharged all mechanics, and
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materialmen's liens arising from any labor or materials furnished to the Real
Property prior to the Close of Escrow.
14.7 No Other Documents. The documents delivered by Seller
to Buyer pursuant to Paragraph 7.1.2 hereof are all of the documents known by
Seller to exist relative to the use, ownership, maintenance, management, and
construction on or of the Property. Seller has not assigned its rights
thereunder to any other person, firm or entity and no further consent is
necessary or required to make any of the Assignment of Leases, the Assignment of
Contracts or the General Assignment effective.
14.8 No Default. Seller is not in default with respect to
any of the Leases, nor will Seller be in default thereunder for the requirements
of notice or the passage of time, or both.
14.9 Hazardous Wastes. There is no asbestos or materials
containing asbestos incorporated into any of the Improvements. The Property is
not in violation of any federal, state or local law, ordinance or regulation
relating to industrial hygiene or to the environmental conditions on, under or
about the Property or the Improvements including, but not limited to, soil and
groundwater condition. Seller further represents and warrants that neither
Seller nor any third party has used, generated, manufactured, stored or disposed
of on, under or about the Property or transported to or from the Property any
flammable explosives, radioactive materials, hazardous wastes or materials,
toxic substances or related materials ("HAZARDOUS MATERIALS"). Seller has no
knowledge of the presence, use, treatment, storage, release or disposal of any
Hazardous Materials at, on, upon or beneath the Land or the Improvements. For
purposes of this Paragraph 14.9, the term "Hazardous Materials" shall include,
but not be limited to, asbestos, petroleum and any petroleum by-products,
formaldehyde, polychlorinated biphenyls, and any other substance which is a
"Hazardous Substance" under California Health and Safety Code Section 25316 and
in the regulations adopted and publications promulgated pursuant to said statute
and any amendments thereto.
14.10 No Notices. Seller has received no notice of (i) any
change contemplated in any applicable laws, ordinances, or restrictions, (ii)
any judicial or administrative action, (iii) any action by adjacent landowners,
or (iv) natural or artificial conditions upon the Property which would prevent,
impede, limit or render more costly Buyer's contemplated use of the Property.
14.11 Systems. Upon the Close of Escrow, all equipment,
heating, air conditioning, plumbing, and electrical systems shall be in good
working order and repair.
14.12 Licenses and Permits. (i) All licenses, approvals,
permits and certificates from all governmental or quasi-governmental
authorities with jurisdiction over the Property or from private parties
necessary for the construction and development of the Improvements, and for the
use and operation of the Property, were obtained prior to such construction,
development, use and operation, and are currently possessed by Seller, (ii) the
Improvements have been constructed in accordance with (A) all such approvals,
licenses, permits and certificates, (B) accepted standards of good materials and
workmanship, (C) all covenants, conditions, restrictions, easements and
agreements of any kind or nature affecting the Real Property,
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and (D) the Improvement Plans delivered to Buyer pursuant to Paragraph 7.1.2
above, and (iii) any conditions to any licenses, approvals, permits and
certificates for the construction and development of the Improvements have been
satisfied. Seller has obtained all easements and rights-of-way (including proof
of dedication) required from all governmental authorities having jurisdiction
over the Real Property or from private parties for the present use and operation
of the Property and to assure vehicular and pedestrian ingress to and egress
from the Real Property at all access points currently being used.
14.13 Taxes. Other than the amounts disclosed by the tax
bills delivered to Buyer by Seller, no other real property taxes, assessments or
charges have been or will be assessed against the Real Property for the current
tax year. Seller has no knowledge, and Seller has received no notice to the
contrary, of any special assessments or charges which have been levied against
the Property or which will result from work, activities or improvements done to
the Property by Seller. Seller has no knowledge and Seller has received no
notice to the contrary of any intended public improvements which will result in
any charge being levied against, or in the creation of any lien upon, the
Property or any portion thereof.
14.14 Utilities. The Improvements are and, as of the Closing
Date, shall be connected to and served by water, septic tank system for solid
waste and sewage disposal, drainage, telephone, gas, electricity and other
utility equipment facilities and services required by law and which are adequate
for the contemplated use and operation of the Property, or any portion thereof,
and which are installed and connected pursuant to valid permits and are in full
compliance with all governmental authorities with jurisdiction. No fact or
condition exists which would result in the termination or impairment in the
furnishing of utility services to the Improvements prior to the Closing Date.
Seller has not received any notice from any individual or entity indicating that
any of such facilities are inadequate or are not in good operating condition.
14.15 No Prior Transfer. Seller has not previously sold,
transferred, or conveyed the Property and Seller has not entered into any
executory contracts for the sale of the Property (other than this Agreement),
nor do there exist any rights of first refusal or options to purchase the
Property.
14.16 Soils Defects. There are no defects or conditions of
the soil which will impair the contemplated use and operation of the Property,
or any portion thereof, the soil condition of the Land is such that it will
support all of the Improvements located thereon for their foreseeable life
without the need for unusual or new subsurface excavations, fill, footings,
caissons or other installations, and the Improvements were constructed in a
manner compatible with the soil condition at the time of construction and all
necessary excavations, fills, footings, caissons and other installations were
provided.
14.17 Insurance Notices. Seller has not received any notice
from any of Seller's insurance carriers of any defects or inadequacies in the
Property, or any portion thereof, which would adversely affect the insurability
of the Property or the cost of any such insurance. There are no pending
insurance claims with respect to all or any portion of the Property.
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14.18 FIRPTA. Seller is not a foreign person within the
meaning of Section 1445(f)(3) of the Internal Revenue Code of 1986, and Seller
will furnish the FIRPTA Certificate to Buyer prior to the Close of Escrow in
accordance with the terms and provisions of Paragraph 8 hereof.
14.19 State Tax Withholding. Seller has read and understands
the provisions of Sections 18805, 18815 and 26131 of the Code and hereby
represents (i) that (A) Seller is a "resident" of California within the meaning
of the Code and the regulations and guidelines of the California Franchise Tax
Board promulgated ("FTB") from time to time pursuant thereto ("FTB REGULATIONS")
and/or (B) this transaction is not otherwise subject to the withholding
requirements of the Code and the Regulations.
14.20 Omissions and Misrepresentations. Neither the
representations and warranties of Seller nor any other document or written
information provided to Buyer by or on behalf of Seller in connection with the
transactions contemplated hereby contain any untrue statement of any material
fact or omit to state any material fact necessary to make any such statement,
warranty, or representation not misleading.
14.20 Representations and Warranties at Closing. The
representations and warranties of Seller set forth in this Agreement shall be
deemed to be remade and restated by Seller on and as of the Close of Escrow.
15. Indemnity by Seller. Seller hereby agrees, after the Close
of Escrow, at its sole cost and expense, to indemnify, protect, defend (with
counsel of Buyer's choice), and hold Buyer, its successors and assigns,
partners, shareholders, officers and/or directors, from and against any and all
claims, demands, damages, losses, liabilities, obligations, penalties, fines,
actions, causes of action, judgments, suits, proceedings, costs, disbursements
and expenses (including, without limitation, attorneys' and experts' reasonable
fees and costs) of any kind or nature whatsoever which may at any time be
imposed upon, incurred or suffered by, or asserted or awarded against, Buyer, or
its successors and assigns, partners, shareholders, officers and/or directors
relating to or arising from (i) the Property or the ownership or operation
thereof on or before the Close of Escrow, (ii) the use on or before the Close of
Escrow of the Property by any third party, including, without limitation, any
invitee or licensee of Seller, (iii) any breach of any covenant, agreement,
representation or warranty of Seller contained in this Agreement; (iv) the
presence, use, handling, storage, disposal or release on or before the Close of
Escrow of Hazardous Materials on, under or about the Property and (v) the
violation of any federal, state or local law, ordinance or regulation, occurring
or allegedly occurring with respect to the Property prior to the Close of
Escrow.
The indemnity by Seller herein contained shall survive the
Close of Escrow and the recordation of the Grant Deed for a period of three (3)
years. Notwithstanding the foregoing three-year limitation, the indemnification
regarding the Encroachment set forth in Section 13.7 hereof shall survive the
Close of Escrow and the recordation of the Grant Deed in perpetuity.
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Notwithstanding anything in this Agreement to the contrary,
if, in Buyer's good faith belief, Buyer is entitled to indemnification,
reimbursement, or payment from Seller hereunder or otherwise under the Stock
Purchase Agreement, then in addition to any other remedies which Buyer may have
available to it, Buyer shall have the right to set off the entire amount thereof
against the amounts, if any, which Buyer shall owe at such time or from time to
time thereafter to Seller under the Real Estate Note.
16. Damage or Condemnation Prior to Closing.
16.1 Material Damage. In the event that prior to the Close
of Escrow, the Real Property, or any portion thereof, is destroyed or materially
damaged, Buyer shall have the right, exercisable by giving written notice to
Seller within seven (7) business days after receipt of written notice of such
damage or destruction, either (i) to terminate this Agreement, in which event
any documents or moneys, including the Deposit, together with any and all
interest earned thereon, in Escrow shall be returned to the party depositing the
same, and neither party hereto shall have any further rights or obligations
hereunder, or (ii) to accept the Real Property in its then condition and to
proceed with the consummation if the transaction contemplated by this Agreement,
with an abatement or reduction in the Purchase Price equal to the amount of the
deductible for the applicable insurance coverage, and to receive an assignment
of all of Seller's rights to any insurance proceeds payable by reason of such
damage or destruction. If Buyer elects to proceed under clause (ii) above,
Seller shall not compromise, settle or adjust any claims to such proceeds
without Buyer's prior written consent, which consent Buyer may withhold in its
sole, absolute, and subjective discretion.
16.2 Nonmaterial Damage. In the event that prior to the
Close of Escrow there is any nonmaterial damage to the Real Property, or any
part thereof, Seller shall repair or replace such damage prior to the Close of
Escrow. Notwithstanding the preceding sentence, in the event Seller is unable to
repair or replace such damage, Seller shall notify Buyer in writing of such fact
("NON-REPAIR NOTICE") and Buyer shall thereafter have the right, exercisable by
giving Seller notice within seven (7) business days after receiving the
Non-Repair Notice either (i) to terminate this Agreement, in which event any
documents or moneys, including the Deposit, together with any and all interest
earned thereon, in Escrow shall be returned to the party depositing the same,
and neither party hereto shall have any further rights or obligations hereunder,
or (ii) to accept the Real Property in its then condition with an abatement or
reduction in the Purchase Price equal to the amount of the deductible for the
applicable insurance coverage and proceed with the transaction contemplated by
this Agreement, in which event Buyer shall be entitled to an assignment of all
of Seller's rights to any insurance proceeds payable by reason of such damage or
destruction. If Buyer elects to proceed under clause (ii) above, Seller shall
not compromise, settle or adjust any claims to such proceeds without Buyer's
prior written consent, which consent Buyer may withhold in its sole, absolute
and subjective discretion.
16.3 Condemnation (Material). In the event that prior to
the Close of Escrow, all or any material portion of the Real Property is subject
to a taking by a public or governmental authority, Buyer shall have the right,
exercisable by giving written notice to Seller within seven (7) business days
after receiving written notice of such taking, either (i) to terminate this
Agreement, in which event any documents or moneys, including the Deposit,
together with any and
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all interest earned thereon, in Escrow shall be returned to the party depositing
the same, and neither party hereto shall have any further rights or obligations
hereunder, or (ii) to accept the Real Property in its then condition, without a
reduction in the Purchase Price, and to receive an assignment of all of Seller's
rights to any condemnation award or proceeds payable 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,
which consent Buyer may withhold in its sole, absolute and subjective
discretion.
16.4 Condemnation (Nonmaterial). In the event that prior
to the Close of Escrow, any nonmaterial portion of the Real Property is subject
to a taking by any public or governmental authority, Buyer shall accept the Real
Property in its then condition and proceed with the consummation of the
transaction contemplated by this Agreement, in which event Buyer shall be
entitled to an assignment of all of Seller's rights to any award or proceeds
payable in connection with such taking. In the event of any such nonmaterial
taking, Seller shall not compromise, settle or adjust any claims to such award
without Buyer's prior written consent, which consent Buyer may withhold in its
sole, absolute and subjective discretion.
16.5 "MATERIAL". For purposes of this Paragraph 16, damage
to the Property or a taking of a portion thereof shall be deemed to involve a
material portion thereof if the estimated cost of restoration or repair, as
estimated by Buyer in Buyer's sole, absolute, and subjective discretion, of such
damage or the amount of the condemnation award with respect to such taking shall
exceed Twenty-five Thousand Dollars ($25,000.00).
16.6 Notice. Seller agrees to give Buyer prompt written
notice of any taking of, proposed taking of, damage to or destruction of the
Real Property.
17. Notices. All notices or other communications required or
permitted hereunder shall be in writing, and shall be personally delivered, sent
by overnight mail (Federal Express or the like) or sent by registered or
certified mail, postage prepaid, return receipt requested, telegraphed,
delivered or sent by telex, telecopy, facsimile, fax or cable and shall be
deemed received upon the earlier of (i) if personally delivered, the date of
delivery to the address of the person to receive such notice, (ii) if sent by
overnight mail, the business day following its deposit in such overnight mail
facility, (iii) if mailed, four (4) business days after the date of posting by
the United States post office, (iv) if given by telegraph or cable, when
delivered to the telegraph company with charges prepaid, or (v) if given by
telex, telecopy, facsimile or fax, when sent. Any notice, request, demand,
direction or other communication sent by cable, telex, telecopy, facsimile or
fax must be confirmed within forty-eight (48) hours by letter mailed or
delivered in accordance with the foregoing.
To Buyer: Children's Comprehensive Services of California, Inc.
00000 Xxxxx Xxxxxx Xxxxxx
Xxxxx Xxxxxxx, Xxxxxxxxxx 00000
Attn: Ms. Xxx Xxxxxxxx
Phone No.(000) 000-0000
Fax No.(000) 000-0000
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With a copy to: Best Best & Xxxxxxx LLP
0000 Xxxxxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxxx 00000
Attn: Xxxxxx X. Xxxxx, Esq.
Phone No. (000) 000-0000
Fax No. (000) 000-0000
To Seller: BMB Enterprises
Xxxx Xxxxxx Xxx 0000
Xxxxxxxxx, Xxxxxxxxxx 00000
Attention: Xx. Xxxxxxx X. Xxxxx, Xx. Xxxxxx X. Xxxxx
or Xx. Xxxxxx X. XxXxx
Phone No. (000) 000-0000
Fax No. (000) 000-0000
With a Copy To: Stream & Stream, Inc.
0000 Xxxxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxxx X. Stream, Jr., Esq.
Phone No. (000) 000-0000
Fax No. (000) 000-0000
To Escrow Chicago Title Company
000 Xxxx Xxxxxxxxxxx Xxxx
Xxx Xxxxxxxxxx, Xxxxxxxxxx 00000
Attention: Xx. Xxxxx Xxxxxx, Senior Escrow Officer
Re: Escrow No. 8241227-K41
Phone No. (000) 000-0000
Fax No. (000) 000-0000
Notice of change of address shall be given by written
notice in the manner detailed in this Paragraph 17. Rejection or other refusal
to accept or the inability to deliver because of changed address of which no
notice was given shall be deemed to constitute receipt of the notice, demand,
request or communication sent.
18. Brokers. The parties hereto represent and warrant to each
other that there are no brokers involved in this transaction. If any claims for
brokers' or finders, fees for the consummation of this Agreement arise, then
Buyer hereby agrees to indemnify, protect, save harmless and defend Seller from
and against such claims if they are based upon any statement, representation or
agreement made by Buyer, and Seller hereby agrees to indemnify, protect, save
harmless and defend Buyer from and against such claims if they are based upon
any statement, representation or agreement made by Seller.
19. Fees, Costs, and Expenses. In the event of the bringing of
any action or suit by a party hereto against another party hereunder by reason
of any breach of any of covenants and
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agreements or any inaccuracies in any of the representations and warranties on
the part of the other party arising out of this Agreement, then in that event,
the prevailing party in such action or dispute, whether by final judgment or out
of court settlement, shall be entitled to have and recover of and from the other
party all costs and expenses of suit, including actual attorneys' fees. Any
judgment or order entered in any final judgment shall contain a specific
provision providing for the recovery of all costs and expenses of suit,
including actual attorneys' fees (collectively "COSTS") incurred in enforcing,
perfecting and executing such judgment. For the purposes of this paragraph,
Costs shall include, without limitation, attorneys' fees, costs and expenses
incurred in the following: (i) post-judgment motions; (ii) contempt proceeding;
(iii) garnishment, levy, and debtor and third party examination; (iv) discovery;
and (v) bankruptcy litigation.
Notwithstanding anything in this Agreement to the contrary, if
Buyer is entitled to any amount from Seller under this Paragraph 19, then in
addition to any other remedies which Buyer may have available to it to collect
such amount, Buyer shall have the right to set off the entire amount thereof
against the amounts, if any, which Buyer shall owe at such time or from time to
time thereafter to Seller under the Real Estate Note.
20. Assignment. Seller may not assign, transfer or convey its
rights or obligations under this Agreement without the prior written consent of
Buyer, and then only if Seller's assignee assumes in writing all of Seller's
obligations hereunder; provided, however, Seller shall in no event be released
from its obligations hereunder by reason of such assignment. Buyer, without
being relieved of liability hereunder and without obtaining Seller's consent,
shall have the right to assign its rights and obligations hereunder or to
nominate another person or entity in whom title to the Property shall vest.
21. Miscellaneous.
21.1 Survival of Covenants. Except as otherwise provided
herein, the covenants, representations and warranties of Seller set forth in
this Agreement shall survive the recordation of the Grant Deed and the Close of
Escrow.
21.2 Required Actions of Buyer and Seller. Buyer and
Seller agree to execute such instruments and documents and to diligently
undertake such actions as may be required in order to consummate the purchase
and sale herein contemplated and shall use their best efforts to accomplish the
Close of Escrow in accordance with the provisions hereof.
21.3 Computation of Time Periods. If the date upon which
the Contingency Period expires, 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
until 5:00 p.m. Pacific Time of the next day which is not a Saturday, Sunday or
federal, state or legal holiday.
21.4 Counterparts. This Agreement may be executed in
multiple counterparts, each of which shall be deemed an original, but all of
which, together, shall constitute but one and the same instrument.
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21.5 Captions. Any captions to, or headings of, the
paragraphs or subparagraphs of this Agreement are solely for the convenience of
the parties hereto, are not a part of this Agreement, and shall not be used for
the interpretation or determination of the validity of this Agreement or any
provision hereof.
21.6 No Obligations to Third Parties. Except as otherwise
expressly provided herein, the execution and delivery of this Agreement shall
not be deemed to confer any rights upon, nor obligate any of the parties hereto,
to any person or entity other than the parties hereto.
21.7 Exhibits and Schedules. The Exhibits and schedules
attached hereto are hereby incorporated herein by this reference for all
purposes.
21.8 Amendment to this Agreement. The terms of this
Agreement may not be modified or amended except by an instrument in writing
executed by each of the parties hereto.
21.9 Waiver. The waiver or failure to enforce any
provision of this Agreement shall not operate as a waiver of any future breach
of any such provision or any other provision hereof.
21.10 Applicable Law. This Agreement shall be governed by
and construed in accordance with the laws of the State of California.
21.11 Fees and Other Expenses. Except as otherwise
provided herein, each of the parties hereto shall pay its own fees and expenses
in connection with this Agreement.
21.12 Entire Agreement. This Agreement supersedes any
prior agreements, negotiations and communications, oral or written, and contains
the entire agreement between Buyer and Seller as to the subject matter hereof.
No subsequent agreement, representation, or promise made by either party hereto,
or by or to an employee, officer, agent or representative of either party hereto
shall be of any effect unless it is in writing and executed by the party to be
bound thereby.
21.13 Successors and Assigns. Subject to the restrictions
set forth in Paragraph 20 hereof, this Agreement shall be binding upon and shall
inure to the benefit of the successors and assigns of the parties hereto.
21.14 Construction. The parties hereto hereby acknowledge
and agree that (i) each party hereto is of equal bargaining strength, (ii) each
such party has actively participated in the drafting, preparation and
negotiation of this Agreement, (iii) each such party has consulted with such
party's own, independent counsel, and such other professional advisors as such
party has deemed appropriate, relative to any and all matters contemplated under
this Agreement, (iv) each such party and such party's counsel and advisors have
reviewed this Agreement, (v) each such party has agreed to enter into this
Agreement following such review and the rendering of such advice, and (vi) any
rule of construction to the effect that ambiguities are to be resolved against
the drafting
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parties shall not apply in the interpretation of this Agreement, or any portions
hereof, or any amendments hereto.
21.15 Consideration. In the event that this Agreement is
canceled by reason of Buyer's disapproval of any of the matters which are
subject to Buyer's approval under Paragraph 7.1 hereof, Buyer shall deliver to
Seller any and all reports, studies and the like prepared by or for Buyer with
respect to the Property; provided, however, that Buyer shall only be obligated
to deliver those reports, studies and the like which are freely transferable by
Buyer, at no cost or expense to Buyer. Any and all such reports, studies and the
like delivered by Buyer to Seller pursuant to this paragraph shall be accepted
by Seller (i) "as-is" without any representation or warranty by Buyer, express,
implied or statutory, with respect to any matter pertaining thereto, and (ii)
subject to the rights of any other party (other than Buyer) with respect
thereto. Seller hereby acknowledges and confirms that such obligation
constitutes sufficient consideration for Seller's obligations hereunder.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement.
"BUYER"
Dated: November 30, 1998 CHILDREN'S COMPREHENSIVE SERVICES OF
CALIFORNIA, INC., a California corporation
By:
--------------------------------------
Name:
------------------------------------
Title:
------------------------------------
{SIGNATURES CONTINUE ON NEXT PAGE]
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23
"SELLER"
Dated: November 30, 0000 XXX ENTERPRISES,
a California general partnership
By:
------------------------------------
Xxxxxx X. Xxxxx
Its: General Partner
And:
------------------------------------
Xxxxxxx X. Xxxxx
Its: General Partner
And:
------------------------------------
Xxxxxx X. XxXxx
Its: General Partner
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24
ACCEPTANCE BY ESCROW HOLDER:
Chicago Title Company hereby acknowledges that it has received
a fully executed original or original executed counterparts of the foregoing
Agreement of Purchase and Sale and Joint Escrow Instructions and agrees to act
as Escrow Holder thereunder and to be bound by and strictly perform the terms
thereof as such terms apply to Escrow Holder.
Dated: ____________________, 1998
CHICAGO TITLE COMPANY
By:
-----------------------------------
Xxxxx Xxxxxx, Senior Escrow Officer
Its Authorized Agent
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