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HomeMy WebLinkAbout2001-07-10 - AGENDA REPORTS - CYNCNTRY LIBRARY PURCHASE (2)CITY OF SANTA CLARITA AGENDA REPORT CONSENT CALENDAR DATE: July 10, 2001 City Manager Approval: i Item to be presented by: en Strinlin SUBJECT: CITY COUNCIL AUTHORIZE THE CITY TO EXERCISE THE PURCHASE OPTION FOR THE CANYON COUNTRY JO ANNE DARCY LIBRARY DEPARTMENT: City Manager's Office RECOMMENDED ACTION City Council approve the option to purchase the Canyon Country Jo Anne Darcy Library for $1,600,000, as stated in the Option Agreement between the City of Santa Clarita and TCP Management. Direct the City Manager to conduct the necessary due diligence, and sign all documents related to the purchase of the facility, subject to City Attorney approval. Money for due diligence and escrow fees. BACKGROUND The Canyon Country Library has been a priority issue for the community for several years. As the current library facility in Canyon Country is not adequate to serve the needs of the residents, the City Council directed staff to work with TCP Management and the County of Los Angeles to build a new library facility to better serve their needs. Over the past two years, the City has worked closely with County staff and the developer to design and construct the facility. The new facility at build -out will be over three times the size of the existing library. Additionally, the new Library will provide more access to technology, a community room, separate children's and adult reading areas, and an outdoor covered patio area. The County of Los Angeles Public Library has agreed to operate the facility, while the City of Santa Clarita will maintain ownership. The County and City will enter into a no -cost lease arrangement for operations and maintenance. In August of 1999, the City of Santa Clarita entered into an agreement with a private developer to construct the new facility as part of a larger commercial project. The City and Developer negotiated options within the Agreement for a lease/purchase of the Library. In addition, the negotiated deal provides that the City release funding throughout the construction process as specific milestones were reached (outlined in the Lease/Purchase Agreement). Once the facility construction is complete and accepted by the City, the City will have the option to either purchase the facility or enter into a lease agreement with the developer to lease the facility. If APPOROYED Agenda Item:✓ the City chose not to purchase the facility, the monies provided throughout the construction process would be credited towards the lease cost. However, since the City is choosing to purchase the building, certain administrative details must be completed to finalize the transaction. The new Library is expected to be finalized by the beginning of August. The City is in the process of conducting the necessary due diligence for the acquisition process. This will all be completed in early August. Therefore, staff is requesting the City Council authorize the purchase of the Library and have the City Manager sign all documents related to the purchase. The tentative grand opening date is August 25, 2001. ALTERNATIVE ACTIONS 1. City Council decides not to proceed with the purchase, and direct staff to enter into a long-term lease agreement. 2. Other action as determined by Council. FISCAL IMPACT The total project cost is estimated at $5.1 million. This includes the total cost of building, furniture, fixtures and equipment, and off-site improvements. The City has made contributions to the project on a periodic basis ($3.5 million) based on development milestones. The purchase option is $1.6 million. All funds have been budgeted and are available for this project. ATTACHMENT Purchase Agreement between TCP Management and the City of Santa Clarita (Attachment available in City Clerk's Reading File.) KS:hds masavpurchm _agenaa.dw PURCHASE AND SALE AGREEMENT WITH JOINT ESCROW INSTRUCTIONS This Purchase and Sale Agreement with Joint Escrow Instructions ("Agreement") is entered into as of July 10, 2001 by and between TCP MANAGEMENT, LLC, a California limited liability company ("Seller") and the CITY OF SANTA CLARITA, a municipal corporation ('Purchaser"). Recitals This Agreement is made with reference to the following facts and circumstances, which are a part of this Agreement: A. Seller is the owner of the real property located in the City of Santa Clarita, County of Los Angeles, State of California and more particularly described in attached Exhibit "1", which is incorporated into this Agreement by reference. That real property, together with all improvements thereon (including, without limitation, the Public library Building (the "Building") constructed thereon by Seller), is referred to herein as the "Real Property". B. Under the Option and Agreement (the "Option Agreement"), dated as of August 4, 1999, between Seller and Purchaser, Purchaser has the option to purchase the Real Property. Purchaser has properly exercised its option, and the parties are entering into this Agreement for the purpose of consummating the purchase and sale of the Real Property. C. As a part of the purchase and sale of the Real Property, Seller is also selling to purchaser all that certain equipment, furniture and other personal property (the "Personal Property") located within the Building and more particularly described in attached Exhibit 2, which is incorporated into this Agreement by reference. D. As a further part of the purchase and sale of the Real Property, Seller is also assigning to Purchaser all assignable guarantees and warranties relating to the Real Property and/or the Personal Property (collectively, the "Warranties"). Such Warranties include, but are not limited to, warranties and guaranties of contractors, suppliers, materialmen and manufacturers. For good and valuable consideration, the receipt and adequacy of which are acknowledged, the parties agree as follows: Section 1. Definitions. In addition to terms defined elsewhere in this Agreement, as used in this Agreement the following terms shall have the following definitions: LA69737.3 A. "Assets" means, collectively, the Real Property, the Personal Property and the Warranties. B. "Environmental Laws" means all federal, state, or local laws, rules, orders, regulations, statutes, ordinances, codes, decrees, or requirements of any government authority, regulating, relating to, or imposing liability or standards of conduct concerning any Hazardous Substances. C. "Hazardous Substances" includes without limitation: (1) All substances, materials, and wastes that are or become regulated or classified as "hazardous substances," "hazardous wastes," "hazardous materials," "toxic substances," "pollutants," "contaminants" or other similar terms under any federal, state, or local laws, rules, orders, regulations, statutes, ordinances, codes, decrees or requirements; and (2) Any petroleum or refined petroleum product, asbestos, polychlorinated biphenyl, material or substance designated as a hazardous substance pursuant to 33 USCS § 1321 or listed pursuant to 33 USCS § 1317, any flammable explosive, or and radioactive material. Section 2. Agreement to Sell and Purchase. Seller agrees to sell and Purchaser agrees to purchase the Assets on and subject to the terms and conditions contained in this Agreement. Section 3. Purchase Price and Payment. The total purchase price for the Assets is the sum of $5,100,000 and that sum is referred to in this Agreement as the "Purchase Price". Seller acknowledges and agrees that pursuant to Paragraph 6 of the Option Agreement the sum of $3,500,000 has been paid by Purchaser toward the Purchase Price outside of Escrow (as defined in Section 4) and received by Seller as of the date of this Agreement. Therefore, on the Closing Date, Purchaser shall pay to Seller the sum of $1,600,000 as the balance of the Purchase Price (the "Balance"). Section 4. Escrow. An escrow ("Escrow") is to be opened to consummate the sale of the Assets at the office of an escrow holder ("Escrow Agent") to be selected by Purchaser and reasonably satisfactory to Seller. The Escrow must be opened not later than 5 days after the execution of this Agreement by both parties. A signed counterpart of this Agreement is to be delivered to the Escrow Agent and will serve as escrow instructions, subject to the provisions of the Escrow Agent's standard conditions for acceptance of escrow, but only to the extent that the standard conditions impose no additional obligations or liabilities on LA69737.3 the parties, and further subject to the terms and conditions in this Agreement, the latter to control in the case of conflict. Section 5. Certain Conditions to Purchaser's Performance. A. Purchaser's obligation to perform under this Agreement and to complete the purchase of the Assets is subject to the satisfaction, or express written waiver by Purchaser, of the following conditions: (1) Seller's representations and warranties in this Agreement being correct as of the date of this Agreement and as of the Close of Escrow; (2) Seller's performance of all obligations to be performed by Seller under this Agreement; and (3) The Title Company being prepared to issue the Title Policy on the Close of Escrow, subject only to the Approved Exceptions. Section 6. Title; Inspections. A. Promptly following the opening of the Escrow, Escrow Agent shall cause a title company (the "Title Company") of Seller's choosing (and reasonably acceptable to Purchaser) to issue to Purchaser (with a copy to Seller) a preliminary report (the "Preliminary Report) for an ALTA Owner's Policy for the Property, setting forth all liens, encumbrances, easements, restrictions, conditions, pending litigation, judgments, administrative proceedings, and other matters affecting Seller's title to the Property, together with copies of all documents relating to title exceptions referred to in the Preliminary Report. Purchaser shall approve or disapprove each exception shown in the Preliminary Report and each encroachment, overlap, or boundary line dispute, or any other matter that affects title to the Property or that violates any law, rule, or regulation reflected therein (each an "Exception") within fourteen (14) following the receipt of the Preliminary Report and the survey referred to in Section 6B and any amendments or updates of the Preliminary Report or the survey; except that Purchaser will not have the right to object and will accept title subject to the lien of property taxes not yet due and such minor easements and matters of record as will not detract from the use of the Real Property for its purpose as a Public Library Facility (collectively, the "Deemed Approved Exceptions"). Purchaser's failure to given written notice of objection within the 14 day period shall be deemed to be an approval of the Exceptions. If any Exception is disapproved in writing (each a "Disapproved Exception"), Seller must, within 30 days following expiration of the 14 day period provided above, cause each Disapproved Exception to be discharged, satisfied, released, or terminated, as the case may be, of record, and in a form that is reasonably satisfactory to Purchaser, all at Seller's sole cost and expense. Upon Seller's request and with Purchaser's approval, Escrow Agent will be authorized to disburse from the cash portion of the Purchase Price and proceeds LA69737.3 otherwise to be disbursed to Seller upon Closing the sum sufficient to discharge any Disapproved Exception that may be discharged only by the payment of money. B. In connection with the issuance of the Preliminary Report, Seller must cause to be provided to Purchaser, at Purchaser's cost and expense, an ALTA survey reasonably satisfactory to Purchaser, prepared and expressly certified to Seller, Purchaser and Title Company by a licensed surveyor or civil engineer, which shows: (1) The legal description of the Property. (2) The location of existing utilities. (3) The location of all easements, rights-of-way and encroachments constituting title exceptions as specified in the Preliminary Report. C. For a period of forty-five (45) days following the date of this Agreement (the "Inspection Period"), Purchaser will have the right to cause inspections to be made of the Property and the Building. If such inspections disclose that (i) there is present on the Property or in the Building Hazardous Materials, (ii) any portion of the Building is not structurally sound (iii) the Building contains patent or latent defects in construction, or (iv) the plumbing, electrical, heating, ventilating and air conditioning and all other operating systems serving the Building are not in good working order and condition (the foregoing being referred to as "Objectionable Conditions"), or if such inspections disclose any other condition which is objectionable to Purchaser (the "Other Objectionable Conditions"), Purchaser may object thereto. Such objection must be made in a writing ("Purchaser's Notice") which specifies the Objectionable Conditions and Other Objectionable Conditions in reasonable detail and which writing is given to Seller on or before the expiration of the Inspection Period. If timely objection is made, Seller shall, at its sole cost and expense, cause each Objectionable Condition to be remedied within thirty (30) days following Seller's receipt of Purchaser's Notice. Further, Seller may elect to remedy some or all of any the Other Objectionable Conditions specified in Purchaser's Notice by giving written notice ("Cure Notice") to Purchaser of that election within five (5) days following Seller's receipt of Purchaser's Notice. If Seller fails to timely deliver a Cure Notice, or if Seller delivers a Cure Notice stating that it will remedy less than all of the Other Objectionable Conditions, then on or prior to fifteen (15) days following the expiration of the Inspection Period, Purchaser may terminate this Agreement or waive its objections. Purchaser's failure to deliver such notice on or prior to fifteen (15) days following the expiration of the Inspection Period shall be deemed to constitute Purchaser's waiver of its objections to any such Other Objectionable Conditions which Seller has not so elected to cure. If Purchaser terminates this Agreement as provided in this Section 6C, this Agreement will terminate upon the giving by Purchaser of the termination notice and Seller and Purchaser will be released from all liabilities and obligations hereunder except for such liabilities and obligations as have accrued prior to the date of termination. Notwithstanding the foregoing, Purchaser's failure to discover or to give notice of any Objectionable Conditions shall not be deemed to be an acknowledgment or agreement by Purchaser that no Objectionable Conditions exist and Seller agrees to be responsible, at its sole cost and expense, to remedy any LA69737.3 Objectionable Conditions identified in a writing given by Purchaser to Seller within one (1) year following the Close of Escrow. D. Access to the Property during the Inspection Period shall be given to Purchaser and its authorized representatives upon one (1) business day's prior notice to Seller. Purchaser agrees to indemnify and defend Seller against and hold Seller harmless from all losses, costs, damages, liabilities, and expenses, including reasonable attorney fees, arising in connection with Purchaser's or its authorized representatives' Inspection of the Property. E. Within ten (10) days following the full execution of this Agreement by both parties, Seller agree to deliver to Purchaser copies of all architectural plans, surveys, specifications, environmental studies and reports, and other documents and agreements pertaining to the physical, geological, or environmental condition of the Property, or that will affect the Property beyond the Close of Escrow, that are owned by or are in the possession or under the control of Seller (collectively, the "Informational Documents"). Section 7. Close of Escrow. A. Simultaneously with the Close of Escrow, Escrow Agent must cause the Title Company to issue an ALTA Owner's Policy of Title Insurance ("Title Policy") in the amount of the Purchase Price, subject only to the following matters ("Approved Exceptions"): (1) a lien for real property taxes, bonds, and assessments not then due; and (2) Exceptions approved by Purchaser in accordance with Section 6 and the Deemed Approved Exceptions. B. Seller is to deposit with Escrow Agent on or prior to the Close of Escrow the following documents: (1) A grant deed executed and acknowledged by Seller conveying to Purchaser good and marketable fee simple title to the Real Property, subject only to the Exceptions approved by Purchaser in accordance with Section 6 and the Deemed Approved Exceptions ("Deed"); (2) A bill of sale executed by Seller and in the form attached hereto as Exhibit "3" (the "Bill of Sale"); (3) An assignment of warranties executed by Seller and in the form attached hereto as Exhibit "4" (the "Assignment"). (4) Seller's affidavit of nonforeign status as contemplated by Section 1445 of the Internal Revenue Code of 1986, as amended ("FIRPTA Affidavit"); and LA69737.3 (5) Seller's affidavit as contemplated by the Revenue and Taxation Code §§ 18805 and 26131 ("Withholding Affidavit"). C. Purchaser is to deposit with Escrow Agent, on or prior to the Close of Escrow, the Balance in accordance with Section 3. D. The Assets are to be conveyed to Purchaser and this transaction is to close ("Close of Escrow") on August 15, 2001, or at such earlier or later time as may be agreed upon in writing by Seller and Purchaser ("Closing Date"). E. On the Closing Date, Escrow Agent is to close Escrow as follows: (1) Record the Deed (marked for return to Purchaser) with the Los Angeles County Recorder (which will be deemed to be delivery to Purchaser); (2) Cause the Title Policy to be issued; (3) Prorate taxes, assessments, rents, and other charges as provided in Section 717; (4) Disburse to Seller the Balance less prorated amounts and charges to be paid by or on behalf of Seller; (5) Charge Purchaser for those costs and expenses to be paid by Purchaser pursuant to this Agreement and disburse any net funds remaining after the preceding disbursements to Purchaser; (6) Prepare and deliver to both Purchaser and Seller one signed copy of Escrow Agent's closing statement showing all receipts and disbursements of the Escrow; and (7) Deliver to Purchaser the Bill of Sale, the Assignment, the FIRPTA Affidavit and the Withholding Affidavit. If Escrow Agent is unable to simultaneously perform all of the instructions set forth above, Escrow Agent is to notify Purchaser and Seller and retain all funds and documents pending receipt of further instructions jointly issued by Purchaser and Seller. F. Prorations. Escrow Agent is to prorate the following costs at the Close of Escrow: (1) Seller is to pay a. all governmental conveyancing fees and taxes due upon transfer of the Real Property, LA69737.3 b. all charges in connection with issuance of the Title Policy except as provided in Section 7F(2)(c), and C. one-half (1/2) of the escrow fee charged by Escrow Agent. (2) Purchaser is to pay a. the recording charges, if any, in connection with recordation of the Deed, b. the portion of the title insurance premium in excess of the premium chargeable for a CLTA Owner's Policy of Title Insurance, but not including the cost of removing or insuring over any Disapprove Exceptions, and C. one-half (1/2) of the escrow fee charged by Escrow Agent. (3) Real property taxes are to be prorated at the Close of Escrow based on the most current real property tax bill available, including any additional property taxes that may be assessed after the Close of Escrow but that relate to a period prior to the Close of Escrow, regardless of when notice of those taxes is received or who receives the notice. All installments of any bond or assessment that constitutes a lien on the Real Property at the Close of Escrow are to be paid by Seller. Section 8. Possession. On the Close of Escrow, Seller will deliver possession of the Assets to Purchaser free from all claims to possession by any and all third parties. Section 9. Liquidated Damages. IF PURCHASER FAILS TO COMPLETE THE PURCHASE AND SALE PROVIDED FOR IN THIS AGREEMENT BY REASON OF ANY DEFAULT, SELLER SHALL BE RELEASED FROM ITS OBLIGATIONS HEREUNDER; HOWEVER BY INITIALING THIS SECTION 9 PURCHASER AND SELLER AGREE THAT IN THE EVENT OF DEFAULT BY PURCHASER HEREUNDER, (A) IT WOULD BE IMPRACTICAL OR EXTREMELY DIFFICULT TO FIX ACTUAL DAMAGES (B) AN AMOUNT EQUAL TO $10,000 SHALL CONSTITUTE LIQUIDATED DAMAGES PAYABLE TO THE SELLER; (C) THE PAYMENT OF THE LIQUIDATED DAMAGES TO SELLER WILL CONSTITUTE THE EXCLUSIVE REMEDY OF THE SELLER; (D) SELLER WILL BE ENTITLED TO THAT AMOUNT ON ACCOUNT OF THE LOSS OF ITS BARGAIN AS LIQUIDATED DAMAGES; AND (E) PAYMENT OF THAT AMOUNT TO SELLER AS LIQUIDATED DAMAGES IS NOT INTENDED AS A FORFEITURE OR LA69737.3 PENALTY WITHIN THE MEANING OF CALIFORNIA CIVIL CODE SECTIONS 3275 OR 3369, BUT INSTEAD, IS INTENDED TO CONSTITUTE LIQUIDATED DAMAGES TO SELLER PURSUANT TO SECTIONS 1671, 1676 AND 1677 OF THE CALIFORNIA CIVIL CODE. Seller's Initials: Purchaser's Initials: Section 10. Seller Representations and Warranties; Indemnities; "AS -IS" Sale. A. Seller represents and warrants to Purchaser as of the date of this Agreement and as of the Close of Escrow: (1) To the best of Seller's knowledge, and except as disclosed by Seller to Purchaser in the Informational Documents or in writing prior to the date of this Agreement, and except as disclosed in any reports or studies made available to, or prepared by or on behalf of, Purchaser: (a) the Real Property is free from Hazardous Substances and is not in violation of any Environmental Laws, (b) there are no buried or partially buried storage tanks located on the Real Property, (c) Seller has received no notice, warning, notice of violation, administrative complaint, judicial complaint, or other formal or informal notice alleging that conditions on the Real Property are or have been in violation of any Environmental Law, or informing Seller that the Real Property is subject to investigation or inquiry regarding Hazardous Substances on the Real Property or the potential violation of any Environmental Law, (d) there is no monitoring program required by the Environmental Protection Agency ("EPA") or any similar state agency concerning the Real Property, (e) no toxic or hazardous chemicals, waste, or substances of any kind have ever been spilled, disposed of, or stored on, under, or at the Real Property, whether by accident, burying, drainage, or storage in containers, tanks, or holding areas, or by any other means, (f) the Real Property has never been used as a dump or landfill, and (g) Seller has disclosed to Purchaser all information, records, and studies maintained by Seller in connection with the Real Property concerning Hazardous Substances. (2) Seller is the owner of the Assets and has the full right, power and authority to sell the Assets to Purchaser. (3) To the best of Seller's knowledge, no condition on the Real Property violates any health, safety, fire, environmental, sewage, building, or other federal, state, or local law, code, ordinance, or regulation. (4) To the best of Seller's knowledge, there are no rights or claims to ownership, possession, occupancy or use of any of the Assets by any third LA69737.3 party, including, without limitation, pursuant to any lease, license, tenancy agreement, or other agreement. (5) To the best of Seller's knowledge, there is no pending or threatened litigation, administrative proceeding, or other legal or governmental action with respect to any of the Assets. (6) To the best of Seller's knowledge, any information that Seller has delivered to Purchaser, either directly or through Seller's agents, is accurate and Seller has disclosed all material facts with respect to the Assets. B. Seller agrees to indemnify Purchaser, its elected and appointed officials, officers, agents and employees, and each of them, and agrees to protect, defend and hold Purchaser, it elected and appointed officials, officers, agents and employees, and each of them, harmless from and against all claims, losses, liabilities, damages, suits, judgments, costs and expenses, including without limitation, attorneys' fees and expenses, to the fullest extent permitted by applicable law, arising out of or relating to (i) Seller's ownership of the Assets, (ii) the conduct of any business, or any activity, work or things done, suffered or permitted, in or about the Real Property or the Building during Seller's ownership of the Real Property, or (iii) the breach of any representation or warranty of Seller contained in this Agreement. Purchaser agrees to indemnify Seller, it directors, officers, members, agents and employees, and each of them, and agrees to protect, defend and hold Seller, its directors, officers, members, agents and employees, and each of them, harmless from and against all claims, losses, liabilities, damages, suits, judgments, costs and expenses, including without limitation, attorneys' fees and expenses, to the fullest extent permitted by applicable law, arising out of or relating to (i) Purchaser's ownership of the Assets or (ii) the conduct of any business, or any activity, work or things done, suffered or permitted, in or about the Real Property or the Building during Purchaser's ownership of the Real Property. The provisions of this Section IOC shall survive the Close of Escrow or any termination of this Agreement. D. IT IS UNDERSTOOD AND AGREED THAT THE ASSETS ARE BEING SOLD AND CONVEYED HEREUNDER AND, UNLESS THE PURCHASER TERMINATES THIS AGREEMENT IN ACCORDANCE WITH THE TERMS OF THIS AGREEMENT, PURCHASER ACCEPTS THE ASSETS "AS IS," "WHERE IS" AND "WITH ALL FAULTS," SUBJECT TO ANY CONDITION WHICH MAY EXIST, AND WITHOUT THE EXISTENCE OF AND RELIANCE ON ANY REPRESENTATION OR WARRANTY BY SELLER, EXCEPT FOR THE WARRANTY OF TITLE CONTAINED IN THE DEED AND THE AGREEMENTS, REPRESENTATIONS AND WARRANTIES OF SELLER EXPRESSLY SET FORTH HEREIN AND IN THE BILL OF SALE AND THE ASSIGNMENT. PURCHASER HEREBY EXPRESSLY ACKNOWLEDGES AND AGREES THAT (A) PURCHASER HAS OR WILL HAVE, PRIOR TO THE END OF THE INSPECTION PERIOD, THOROUGHLY INSPECTED AND EXAMINED THE ASSETS TO THE EXTENT DEEMED NECESSARY BY PURCHASER IN ORDER TO ENABLE PURCHASER LA697373 TO EVALUATE THE PURCHASE OF THE ASSETS AND (B) PURCHASER IS RELYING SOLELY UPON SUCH INSPECTION, EXAMINATION AND EVALUATION OF THE ASSETS BY PURCHASER IN PURCHASING THE ASSETS ON AN "AS IS," "WHERE IS" AND "WITH ALL FAULTS" BASIS, WITHOUT REPRESENTATIONS, WARRANTIES OR COVENANTS, EXPRESS OR IMPLIED, OF ANY KIND OR NATURE, EXCEPT AS EXPRESSLY PROVIDED HEREIN, IN THE DEED, IN THE BILL OF SALE AND IN THE ASSIGNMENT. THE PROVISIONS OF THIS SECTION SHALL SURVIVE THE CLOSE OF ESCROW OR ANY TERMINATION OF THIS AGREEMENT. Section 11. Seller Covenants. A. Commencing with the execution of this Agreement and until the Close of Escrow: (1) Seller will not permit any liens, encumbrances, or easements to be placed on the Real Property or the Personal Property, other than the Approved Exceptions, nor will Seller enter into any agreement regarding the sale, rental, management, repair, improvement, or any other matter affecting the Real Property or the Personal Property that would be binding on Purchaser, the Real Property or the Personal Property after the Close of Escrow, without the prior written consent of Purchaser. (2) Seller will maintain the Real Property and the Personal Property in good order, condition and repair, ordinary wear and tear excepted, and shall not permit any act of waste or act that would tend to diminish the value of the Real Property or the Personal Property in any way. Section 12. Authority of Parties. A. Seller represents and warrants that this Agreement: (1) has been duly authorized, executed, and delivered by Seller; (2) is the valid and binding obligation of Seller in accordance with its terms; (3) does not violate the provisions of any agreement or instrument, or any judgment, order or decree, to which Seller is a party or by which Seller or any of the Assets are bound. B. Purchaser represents and warrants that this Agreement: (1) has been duly authorized, executed, and delivered by Purchaser; LA69737.3 10 (2) is the valid and binding obligation of Purchaser in accordance with its terms; and (3) does not violate the provisions of any agreement or instrument, or any judgment, order or decree, to which Purchaser is a party or by which Purchaser is bound. C. Each party warrants and represents to the other that the persons executing this Agreement on its behalf are authorized to do so, and on execution of this Agreement, this Agreement shall be its valid and binding obligation, enforceable against it in accordance with its terms. Section 13. Brokers. Each party warrants and represents to the other that no brokers have been retained or consulted in connection with this transaction. Each party agrees to defend, indemnify, protect and hold harmless the other party from any claims, expenses, costs, or liabilities arising in connection with a breach of that party's representations, warranties, or covenants under this Agreement. The provisions of this Section 13 shall survive the Close of Escrow or any termination of this Agreement. Section 14. Assignment. Purchaser and Seller, and each of them, do not have the right to assign, either in whole or in part, this Agreement or their respective rights and liabilities under this Agreement, without the express written consent of the other party Section 15. Attorney Fees. If litigation is commenced between the parties, the prevailing party in that litigation is entitled to recover from the nonprevailing party all reasonable attorneys' fees and costs as fixed by the court. Section 16. Notices. A. All notices to be given under this Agreement must be in writing and sent to the respective party's notice addresses set forth below by (1) first class mail, postage prepaid, in which case notice will be deemed delivered three (3) business days after deposit in the United States Mail, or (2) personal delivery, or by commercial messenger or courier service, in each which case notice will be deemed delivered upon receipt. The notice addresses of the parties are as follows: LA69737.3 I I Purchaser: City of Santa Clarita 23920 Valencia Boulevard, Suite 300 Santa Clarita, California 91355 Attention: City Clerk with a copy to: Carl K. Newton, City Attorney Burke, Williams & Sorensen, LLP 611 West Sixth Street, Suite 2500 Los Angeles, California 90017 Seller: TCP Management LLC California Attention: with copy to: EFO Realty, Inc. 2626 Cole Avenue, Suite 700 Dallas, Texas 75204 Attention: Christopher W. Malowald or to such other address as Purchaser or Seller may respectively designate by written notice to the other given in the manner prescribed herein. Section 17. Entire Agreement. This Agreement contains the entire agreement between the parties with respect to the subject matter of this Agreement and supersedes all prior or contemporaneous agreements and understandings (whether written or oral) of the parties. This Agreement cannot be modified in any manner except by an instrument in writing executed by the duly authorized representatives of the parties or of their respective successors in interest. Section 18. Severability. If any term or provision of this Agreement is, to any extent, held invalid or unenforceable, the remainder of this Agreement shall not be affected. Section 19. Waivers. Any waiver of a breach of any covenant or condition in this Agreement is not to be deemed a waiver of any other covenant or condition in this Agreement, and no waiver is valid unless in writing and executed by the duly authorized representative of the LA69737.3 12 waiving party. An extension of time for performance of any obligation or act is not to be deemed an extension of the time for performance of any other obligation or act. Section 20. Construction. The section headings and captions of this Agreement are, and the arrangement of this instrument is, for the sole convenience of the parties to this Agreement. The section headings, captions, and arrangement of this instrument do not in any way affect, limit, amplify, or modify the terms and provisions of this Agreement. The singular form includes plural, and vice versa. This Agreement is not to be construed as if it had been prepared by one of the parties, but rather as if both parties had prepared it. Unless otherwise indicated, all references to sections are to this Agreement. All exhibits referred to in this Agreement are attached to it and incorporated in it by this reference. Section 21. Counterparts. This Agreement may be executed in one or more counterparts. Each counterpart is an original, but all counterparts are the same instrument. Section 22. Time of the Essence. Time is of the essence in this Agreement. Section 23. Successors. This Agreement inures to the benefit of and is binding upon the parties to this Agreement and their respective heirs, successors, and assigns. Section 24. Governing Law. This Agreement is to be governed and construed in accordance with California law. Section 25. Survival Except as otherwise expressly provided in this Agreement, the representations, warranties, covenants and indemnities of and by the parties contained in this Agreement survive the Close of Escrow and the delivery of the Deed for a period of one (1) year. H H H H [SIGNATURES ARE ON THE NEXT PAGE] H H H H LA69737.3 13 IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first written above. CITY OF SANTA CLARITA, TCP MANAGEMENT LLC, a municipal corporation a California limited liability company By George A. Caravalho, City Manager (Print Name & Title) ATTEST: City Clerk (Print Name & Title) APPROVED AS TO FORM: Carl K. Newton, City Attorney LA69737.3 14 EXHIBIT "1" Legal Description [TO COME] LA69737.3 EXHIBIT "2" Description of Personal Property LA69737.3 EXHIBIT "3" Form of Bill of Sale THIS BILL OF SALE is executed and delivered pursuant to that certain Purchase and Sale Agreement With Joint Escrow Instructions (the "Purchase Agreement"), entered into as of July 10, 2001, by and between TCP MANAGEMENT, LLC, a California limited liability company ("Seller"), and the CITY OF SANTA CLARITA, a municipal corporation ("Purchaser"). Seller, for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, hereby grants, bargains, sells and delivers to Buyer all of Seller's right, title and interest in and to the Personal Property. The Seller covenants and warrants that it is the owner of the Personal Property and that the Personal Property is free and clear of all liens and encumbrances, and that the Seller will defend the sale of the Personal Property against any and all persons claiming the same or any part thereof. Unless a different meaning is specifically set forth herein, all of the capitalized terms contained in this Bill of Sale have the same meanings ascribed to them in the Purchase Agreement. This Bill of Sale shall be effective on and after the Close of Escrow as provided for in the Purchase Agreement. DATED: 2001. TCP Management, LLC, a California limited liability company M LA69737.3 (Print Name & Title) (Print Name & Title) EXHIBIT "4" Form of Assignment Agreement FOR VALUE RECEIVED, TCP MANAGEMENT, LLC, a California limited liability company ("Seller"), hereby sells, assigns and transfers to the CITY OF SANTA CLARITA, a municipal corporation ("Purchaser'), all assignable guarantees and warranties relating to the Real Property and/or the Personal Property (collectively, the "Warranties"). Such Warranties include, but are not limited to, warranties and guaranties of contractors, suppliers, materialmen and manufacturers. This Assignment may be executed in counterparts, each of which shall be deemed an original, and counterpart signature pages may be assembled to form a single original document. This Assignment is executed and delivered pursuant to the terms of that certain Purchase and Sale Agreement With Joint Escrow Instructions (the "Purchase Agreement"), entered into as of July 10, 2001, by and between Seller and Purchaser and, unless a different meaning is specifically set forth herein, all of the capitalized terms set forth in this Assignment shall have the same meanings ascribed to such terms in the Purchase Agreement. This Assignment shall be effective on and after the Close of Escrow as provided for in the Purchase Agreement. DATED: 2001. TCP Management, LLC, a California limited liability company .0 (Print Name & Title) By: (Print Name & Title) LA69737.3 1