HomeMy WebLinkAboutContracts & Agreements_55-2023PURCHASE AND SALE AGREEMENT AND JOINT ESCROW INSTRUCTIONS
DATED MARCH 21, 2023
BY AND BETWEEN
CATHY A. MACKNET, KENNETH D. MACKNET II and MARK R. MACKNET,
Joint Tenants in Common, AS SELLER
AND THE
CITY OF REDLANDS,
a municipal corporation, AS BUYER
TABLE OF CONTENTS
Page
1. PURCHASE AND SALE. 1
2. PURCHASE PRICE 1
3. ESCROW 2
3.1 Opening of Escrow 2
3.2 Escrow Instructions 2
3.3 Termination/Cancellation 2
4. ACTIONS PENDING CLOSING. 3
4.1 Due Diligence. 3
4.1.1 Property Materials 3
4.1.2 City's Due Diligence Tests. 4
4.1.3 City's Termination Right 4
4.2 Title 5
4.2.1 Deliveries by Seller 5
4.2.2 City's Review of Title 5
4.2.3 Condition of Title at Closing 6
5. DESCRIPTION OF PROPERTY. 6
5.1 The Property 6
6. CONDITIONS TO CLOSING. 6
6.1 City's Closing Conditions 6
6.1.1 Title 6
6.1.2 Seller's Due Performance 7
6.1.3 Physical Condition of Property 7
6.1.4 Bankruptcy 7
6.1.5 Posession/Removal of Personal Property 7
6.2 Seller's Closing Conditions 7
7. CLOSING. 7
7.1 Closing Date 7
7.2 Deliveries by Seller 7
7.2.1 Grant Deed 8
7.2.2 Non -Foreign Affidavit 8
7.2.3 State Affidavit 8
7.2.4 Owner's Affidavit 8
7.2.5 Proof of Authority 8
7.2.6 Other 8
7.3 Deliveries by City 8
7.3.1 Purchase Price 8
7.3.2 Proof of Authority 8
7.3.3 Other 8
7.4 Actions by Escrow Agent 9
7.4.1 Recording 9
7.4.2 Funds 9
7.4.3 Delivery of Document 9
7.4.4 Owners Title Policy 9
7.5 Prorations/Apportionment 9
7.5.1 Method of Proration 9
7.5.2 Survival 10
7.6 Closing Costs 10
7.7 Closing Statement 10
7.8 Deliveries Outside of Escrow 11
8. SELLER'S REPRESENTATIONS AND WARRANTIES. 11
8.1 Seller's Authority; Validity of Agreements 11
8.2 No Third -Party Rights 11
8.3 Litigation 11
8.4 No Violations of Environmental Laws 11
8.5 No Other Commitments 12
8.6 Property Materials 12
8.7 Permits and Approvals 12
8.8 Survival 12
9. CITY' S REPRESENTATIONS AND WARRANTIES 12
9.1 City's Authority; Validity of Agreements 12
9.2 Survival 13
10. AS -IS 13
11. RISK OF LOSS 13
11.1 Condemnation 13
11.2 Casualty 14
12. REMEDIES 14
12.1 Default by Seller 14
12.2 Default by City 15
13. BROKERS. 15
14. MISCELLANEOUS PROVISIONS 15
14.1 Entire Agreement 15
14.2 Modification; Waiver 16
14.3 Notices 16
14.4 Expenses 17
14.5 Severability 17
14.6 Successors and Assigns 17
14.7 Counterparts 17
14.8 Governing Law; Jurisdiction 17
14.9 Headings 17
14.10 Time of Essence 17
14.11 Further Assurances 17
14.12 Construction 18
14.13 Attorneys Fees 18
14.14 Business Days 18
PURCHASE AND SALE AGREEMENT
AND JOINT ESCROW INSTRUCTIONS RECITALS
This purchase and sale agreement and joint escrow instructions ("Agreement") is made and
entered into as of March 21, 2023 ("Effective Date"), by and between the City of Redlands, a
municipal corporation ("City"), and Cathy A. Macknet, Kenneth D. Macknet II and Mark R.
Macknet, Joint Tenants in Common, ("Seller"), for the purpose of setting forth their agreement,
and to provide instructions to Escrow Agent with respect to the transaction contemplated by this
Agreement. Seller and City shall also individually be referred to as a "Party" and collectively as
the "Parties."
RECITALS
WHEREAS, Seller is the owner of that certain real property located on Helen Court in the
City of Redlands ("City"), County of San Bernardino ("County"), State of California, known as
County Assessor's Parcel Numbers 0300-451-13, 14, 24, and 25-0000 ("Property"); and
WHEREAS, Seller desires to sell the Property to City, and City desires to purchase the
Property from Seller, upon and subject to the terms and conditions set forth in this Agreement;
NOW, THEREFORE, in consideration of the mutual promises contained in this
Agreement, and for other good and valuable consideration the receipt and sufficiency of which is
hereby acknowledged, City and Seller hereby agree, and instruct Escrow Agent (as hereinafter
defined in Section 3.1 hereof), as follows:
AGREEMENT
Section 1. PURCHASE AND SALE. Seller agrees to sell, transfer, and convey to City,
and City agrees to purchase and acquire from Seller, the Property on all of the terms and conditions
of this Agreement.
Section 2. PURCHASE PRICE.
The purchase price for the Property ("Purchase Price") shall be One Million Four Hundred
Thousand Dollars ($1,400,000) and shall be payable as follows:
2.1 Deposit. Within five (5) Business Days following the "Opening of Escrow" (as
hereinafter defined), City shall deposit into "Escrow" (as hereinafter defined) the sum of Thirty -
Six Thousand Dollars ($36,000) (which amount, together with any and all interest earned thereon,
shall hereinafter be referred to as the "Deposit"). The Deposit shall be fully refundable through the
Due Diligence Termination Date, as defined in Section 4.1.3. From and after the Due Diligence
Termination Date, provided City does not elect to terminate this Agreement pursuant to the terms
of Section 4.1.3, the Deposit shall become non-refundable, except as specifically provided
otherwise herein, and shall be credited against the Purchase Price at Closing.
2.1.1. Refund of Deposit. In the event that City delivers its Due Diligence
Approval Notice (as defined in Section 4.1.3), but subsequently elects to terminate this Agreement
due to (a) Seller Default, as defined in Section 12.1 hereunder, (b) a failure of a City's Condition
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to Closing or (c) the occurrence of any other event which by the terms of this Agreement gives
rise to City's right to terminate this Agreement and receive a refund of the Deposit, then, subject
to the terms of Section 12.1, (i) the Deposit shall be returned by Escrow Agent to City, or to the
extent previously released to Seller, and refunded to City by Seller, (ii) this Agreement and the
Escrow shall terminate, and (iii) the Parties shall have no further obligation to one another with
respect to this Agreement, except with respect to such provisions which by their terms survive the
termination of this Agreement.
2.1.2. Interest. The Deposit and any other cash held by Escrow Agent for the
benefit of City shall be held in a federally insured interest bearing account, and the interest shall
accrue to City's benefit.
2.1.3. Deposit of Balance. City shall, at least two (2) days prior to Closing (as
- defined -in Section 7:1)Tdeposit-into Escrow in the form of wire-transfer,—cashor a certified or-b-ank--
cashier's check for immediately available funds, the amount of the Purchase Price less the Deposit,
plus City's closing costs and City's share of any prorations to be made in accordance with this
Agreement.
Section 3. ESCROW.
3.1 Opening of Escrow. City and Seller shall cause an escrow ("Escrow") to be
opened with First American Title located at 901 Via Piemonte, Suite 150, Ontario, CA 91764,
Attention: Kelly Simoneau, ksimoneau@firstam.com ("Escrow Agent"), by delivery to
Escrow Agent of a fully executed copy of this Agreement. Escrow Agent shall promptly
deliver to City and Seller written confirmation of the date of the "Opening of Escrow."
As used in this Agreement, the term "Opening of Escrow" means the day on which Escrow
Agent receives a fully executed copy of this Agreement and has notified each Party in writing
of such receipt and the specific date of the Opening of Escrow.
3.2 Escrow Instructions. This Agreement shall constitute escrow instructions
to Escrow Agent as well as the agreement of the Parties relating to the purchase and sale of
the Property. If any other printed escrow instructions are requested of the Parties and the terms
thereof conflict -or- are inconsistent with any provision of this Agreement or any deed,
instrument, or document executed or delivered in connection with the transaction
contemplated hereby, the provisions of this Agreement, or such deed, instrument or document,
shall control. Escrow Agent is hereby appointed and designated to act as Escrow Agent and
instructed to deliver, pursuant to the terms of this Agreement, the documents and funds to be
deposited into Escrow as provided this Agreement.
3.3 Termination/Cancellation. Upon any termination or cancellation (the terms
being used interchangeably in this Agreement) of this Agreement by either of the Parties, (i) the
Deposit shall be delivered to the Party that this Agreement specifies is entitled to the
same; (ii) all documents, instruments, and funds delivered into Escrow shall be returned to
the Party that delivered the same into Escrow, and (iii) the Parties shall thereafter be
relieved from further liability under this Agreement, except with respect to any obligations
under this Agreement that are expressly stated to survive any termination of this Agreement.
A copy of any notice of termination allowed under this Agreement shall be sent to Escrow
Agent by the Party electing to terminate.
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Section 4. ACTIONS PENDING CLOSING.
4.1 Due Diligence.
4.1.1 Property Materials.
4.1.1.1 On or before 5:00 p.m. on the tenth (10th) day following the
Opening of Escrow, Seller shall, at Seller's sole cost and expense, to the extent within the Seller's
possession or control, provide to City and City's counsel true, correct, and complete copies of all
of the following documents (collectively, the "Property Materials"):
(a) Any and all surveys for the Property;
(b) All existing, proposed or draft site plans, maps, plats, landscaping
plans, construction plans and drawings, and development plans for
the Property (including, without limitation, with respect to offsite
development related to the Property);
(c) All existing environmental reports for the Property;
(d) All leases, occupancy agreements, operating agreements, and
licenses that affect the Property;
(e) All zoning stipulations, agreements, and requirements that affect or
that are proposed to affect the Property;
(f) All archaeological, biological, soil, geological, grading, drainage,
and hydrology reports; surveys, or assessments and any other
engineering reports for the Property;
(g) A Natural Hazards Disclosure Report in conformity with the
California Natural Hazards Disclosure Act;
(h) All records to the extent within Seller's possession or control
relating to the use, storage and disposal of all pesticides, fertilizers
and other agricultural chemicals which have been used on the
Property or that Seller anticipates Seller, or its agents or contractors,
will use on the Property prior to the Close of Escrow, and
(i) All due diligence reports supplied by Miller Architectural
Corporation pertaining to the Property.
(j) Any other third -party reports, contracts, and agreements of any kind
in Seller's possession or control pertaining to the Property.
4.1.1.2 Seller shall promptly furnish to City for its review (i) any of
the items described in Section 4.1.1.1 that may come into Seller's possession or control from and
after the Effective Date of this Agreement, and (ii) any additional documents and information in
the possession or control of Seller reasonably requested in writing by City. City understands and
acknowledges that neither Seller nor any of Seller's representatives makes any representation or
warranty to City as to the accuracy or completeness of the Property Materials and that Seller and
Seller's representatives shall have not made or will not make any attempt to verify the data
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contained therein. City agrees that Seller and Seller's representatives shall not have any liability
to City as a result of City's use of the Property Materials.
4.1.2 City's Due Diligence Tests.
4.1.2.1 For the period of forty five (45) days from the Effective Date of
this Agreement, City and its employees, agents, consultants, and contractors shall be entitled, at
City's sole cost and expense, to: (i) enter onto the Property to perform any inspections,
investigations, studies, and tests of the Property (including, without limitation, physical,
engineering, soils, geotechnical, and environmental tests) that City deems reasonable; (ii) review
all Property Materials; and (iii) investigate such other matters pertaining to the Property as City
may desire (collectively, the "Due Diligence Period"). Notwithstanding the foregoing, City shall
not conduct any invasive testing on the Property without the prior consent of Seller, which shall
not be unreasonably withheld, delayed (specifically, Seller shall respond to City's request to
conduct such testing not more than twenty-four (24) hours after written notice by City to Seller),
or conditioned. Any entry by City onto the Property shall be subject to, and conducted in
accordance with, all applicable laws.
4.1.2.2 City shall keep the Property free and clean of any mechanics'
liens and indemnify, protect, defend, and hold Seller harmless from and against any and all claims
(including, without limitation, claims for mechanic's liens or materialman's liens), causes of
action, demands, obligations, losses, damages, liabilities, judgments, costs, and expenses
(including, without limitation, reasonable attorneys' fees, charges, and disbursements)
(collectively, "Claims") in connection with or arising out of any inspections of the Property carried
on by or on behalf of City pursuant to the terms of this Agreement, provided, however, that City
shall have no responsibility or liability for (i) the negligence or willful misconduct of Seller; (ii)
any adverse condition or defect on or affecting the Property not caused by City or its employees,
agents, consultants, or contractors but discovered or impacted during their inspections including,
without limitation, the pre-existing presence or discovery of any matter (such as, but not limited
to, any Hazardous Substance (as defined in this Agreement ); and/or (iii) the results or findings of
any inspection.
4.1.2.3 Upon completion of City's inspections, City shall promptly
repair any material damage to the Property caused by its entry and restore the Property to
substantially the same conditions which existed prior to City's entry under this Section 4.1.2.
4.1.2.4 The provisions of this Section 4.1.2 shall survive the Closing or
the earlier termination of this Agreement.
4.1.3 City's Termination Right. City shall have the right at any time on or before
5:00 p.m. on the forty fifth (45th) day after the Opening of Escrow (the "Due Diligence
Termination Date") to terminate this Agreement by delivering a written notice of such termination
to Seller and Escrow Agent if City determines, in its sole and absolute discretion, that the Property
is not acceptable to City for any reason. City shall indicate its satisfaction and/or waiver of the Due
Diligence condition described in this Section 4.1 by delivering written notice of such satisfaction
and/or waiver ("Due Diligence Approval Notice") to Seller and Escrow Agent on or prior to the
Due Diligence Termination Date. If City fails to timely deliver a Due Diligence Approval Notice,
then this Agreement and the Escrow shall be automatically deemed terminated. If this Agreement
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is terminated in accordance with this Section, then the Initial Deposit shall be immediately returned
to City and the Parties shall thereafter be relieved from further liability hereunder, except with
respect to any obligations under this Agreement that are expressly stated to survive any termination
of this Agreement.
4.2 Title.
4.2.1 Deliveries by Seller. On or before 5:00 p.m. on the third (3rd) Business
Day after the Opening of Escrow, Seller shall cause First American Title Company ("Title
Insurer") to issue and deliver to City, at City's sole cost and expense, (i) a current commitment for
an ALTA extended coverage Owner's Policy of Title Insurance for the Property (the "Title
Report") and (ii) legible copies of all documents referenced as exceptions in the Title Report
(collectively with the Title Report, the "Title Documents").
4.2.2 City's Review of Title. City shall have until the Due Diligence Termination
Date to notify Seller in writing of any objection that City may have to any matters reported or
shown in any survey or the Title Documents or any amendments or updates thereof ("City's Title
Objection Letter") (provided, however, that if any such amendments or updates are received by
City after or within five (5) Business Days before the Due Diligence Termination Date, City shall
have five (5) Business Days following City's receipt of such amendment or update and copies of
all documents referenced in the Title Documents to notify Seller of objections to matters shown
on any such amendment or update that were not disclosed on the previously delivered survey or
Title Documents and the Closing Date shall automatically be extended as necessary to facilitate
such notice period and any subsequent periods for Seller's response and City's election as provided
in subsections (i) and (ii), below). Matters shown as exceptions to coverage in the Title Report (or
any amendments or updates thereof) that are not timely objected to by City as provided above shall
constitute "Permitted Exceptions." Seller shall cooperate, at no cost to Seller, with City to
eliminate matters objected to by City, but, except as set forth in the last sentence of this Section
4.2.2, Seller shall have no obligation to cure or correct any matter objected to by City. On or
before the fifth (5th) Business Day following Seller's receipt of City's Title Objection Letter,
Seller may elect, by delivering written notice of such election to City and Escrow Agent ("Seller's
Response"), to cause Title Insurer to remove or insure over any matters objected to in City's Title
Objection Letter. If Seller fails to deliver Seller's Response within the period set forth above, it
shall be deemed an election by Seller not to cause Title Insurer to so remove or insure over such
objections. If Seller elects or is deemed to have elected not to cause Title Insurer to so remove or
insure, or if City determines, in its sole discretion, that any proposed endorsement for or insurance
over an objected matter is unsatisfactory, then City must elect, by delivering written notice of such
election to Seller and Escrow Agent on or before the earlier to occur of (i) the fifth (5th) Business
Day following City's receipt of Seller's Response or (ii) if no Seller's Response is received by
City, the fifth (5th) Business Day following the date on which Seller shall have been deemed to
have responded, as provided above, to: (i) terminate this Agreement, in which case the Initial
Deposit, to the extent previously deposited in Escrow, shall be immediately returned to City; or
(ii) proceed with this transaction, in which event those objected to exceptions or matters that Seller
has not elected to cause Title Insurer to so remove or insure shall be deemed to be Permitted
Exceptions. If City fails to make such election on a timely basis, then City shall be deemed to
have elected to terminate this Agreement in accordance with the preceding clause (i).
Notwithstanding anything else stated in this Agreement, in all events, regardless of whether City
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has given notice of objection as stated above, Seller shall be obligated to satisfy and otherwise
remove all monetary and financial liens and encumbrances in existence as of the Agreement Date
or incurred by Seller on or before the Closing Date (other than current taxes not yet due) and any
additional encumbrances incurred by Seller after the Effective Date in violation of any provision
of this Agreement, and, except as may be otherwise specifically set forth in this Agreement,
terminate all leases, possessory agreements, licenses, and operating agreements that affect the
Property and City need not object to any such matters. Seller agrees not to cause or create any
additional encumbrances or other matters affecting title to the Property to be incurred following
the Effective Date that are not satisfied or otherwise removed on or before the Closing Date as
contemplated above.
4.2.3 Condition of Title at Closing. Upon the Closing, Seller shall sell, transfer,
and convey to City fee simple title to the Property by a duly executed and acknowledged grant
deed in the form of Exhibit "A" attached hereto (the "Grant Deed"), subject only to the Permitted
Exceptions and the reservations and other matters, if any, referenced or described in said Grant
Deed.
Section 5. DESCRIPTION OF PROPERTY.
5.1 The Property. As used in this Agreement, the term "Property" shall mean,
collectively, all of SelIer's right, title, and interest in and to: (a) all buildings and related
improvements on the Property ("Improvements"); and (b) all of the rights, privileges,
appurtenances, hereditaments, easements, reversions, and remainders pertaining to or used in
connection with the Property, including, without limitation, all (i) development rights and credits,
air rights, water, water rights, and water stock relating to the Property, (ii) strips and gores, streets,
alleys, easements, rights -of -way, public ways, or other rights appurtenant, adjacent, or connected
to the Property, and (iii) minerals, oil, gas, and other hydrocarbon substances in, under, or that may
be produced from the Property.
Section 6. CONDITIONS TO CLOSING.
6.1 Citv's Closing Conditions. The obligation of City to complete the transaction
contemplated by this Agreement is subject to the following conditions precedent (and conditions
concurrent, with respect to deliveries to be made by Seller at the Closing) ("City's Closing
Conditions"), which conditions may be waived, or the time for satisfaction of such conditions
extended, by City only in a writing executed by City:
6.1.1 Title. Title Insurer shall be irrevocably and unconditionally prepared and
committed to issue to City (with an effective date not earlier than the Closing Date), an ALTA
extended coverage owner's policy of title insurance ("ALTA Extended Policy") in favor of City
for the Property (i) showing fee title to the Property vested in City, (ii) with liability coverage in
an amount equal to the Purchase Price, (iii) with those endorsements reasonably requested by City
including, without limitation, a Mechanic's Lien Endorsement, and (iv) containing no exceptions
other than the Permitted Exceptions and the reservations and other matters referenced or described
in the Grant Deed ("Owner's Title Policy"). City shall pay any difference in the cost of the
premium for a standard ALTA owner's policy of title insurance and the ALTA Extended Policy.
If a new or updated survey is required to enable the Title Company to issue the ALTA Extended
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Policy, City shall obtain the same, at its sole cost and expense, in a timely manner so as to facilitate
the issuance of the ALTA Extended Policy upon the Close of Escrow.
6.1.2 Seller's Due Performance. All of the representations and warranties of
Seller set forth in Section 8 shall be true, correct, and complete in all material respects as of the
Closing Date, and Seller, on or prior to the Closing Date, shall have complied with and/or
performed all of the obligations, covenants, and agreements required on the part of Seller to be
complied with or performed pursuant to the terms of this Agreement on or prior to the Closing.
6.1.3 Physical Condition of Property. The physical condition of the Property
shall be substantially the same on the Closing Date as on the Effective Date, except for reasonable
wear and tear and any damages due to any act of City or City's representatives.
6.1.4 Bankruptcy. No action or proceeding shall have been commenced by or
against Seller under the federal bankruptcy code or any state law for the relief of debtors or for the
enforcement of the rights of creditors, and no attachment, execution, lien, or levy shall have
attached to or been issued with respect to Seller's interest in the Property or any portion thereof.
6.1.5 Possession/Removal of Personal Property. Upon the Close of Escrow,
Seller shall deliver exclusive and vacant possession of the Property to City. Prior to the Close of
Escrow, Seller shall have the right to remove any or all improvements and Seller's equipment,
trade fixtures or other personal property. Any such salvage and removal shall be performed
pursuant to all required permits, in accordance with all laws, rules and regulations, and in such
manner that the Property is delivered upon the Close of Escrow without any safety issues on site,
such as large holes, partially razed structures, or any other similarly unsafe conditions. Any
improvements or personal property of Seller remaining on the Property after the Close of Escrow
shall be conclusively deemed abandoned by Seller ("Abandoned Personal Property"). Seller
waives and relinquishes all rights, title, interest and claims in any such Abandoned Personal
Property and effective upon abandonment transfers, conveys and assigns all of its right, title and
interest in such Abandoned Personal Property to City for disposition as determined by City in
City's sole and absolute discretion.
6.2 Seller's Closing Conditions. All of the representations and warranties of City set
forth in Section 9 shall be true, correct, and complete in all material respects as of the Closing
Date, and City, on or prior to the Closing Date, shall have complied with and/or performed all of
the obligations, covenants, and agreements required on the part of City to be complied with or
performed pursuant to the terms of this Agreement on, or prior to, the Closing, including but not
limited to obtaining a determination that the purchase of the Property conforms to the Redlands
General Plan as required pursuant to Government Code Section 65402.
Section 7. CLOSING.
7.1 Closing Date. Subject to the provisions of this Agreement, the Closing shall take
place on or before that date ("Closing Date") which is the fifteenth (15th) day after the expiration
date of the Due Diligence Period. As used in this Agreement, the "Closing" shall mean the
recordation of the Grant Deed in the Official Records.
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7.2 Deliveries by Seller. On or before the Closing Date, Seller, at its sole cost and
expense, shall deliver or cause to be delivered into Escrow the following items, documents, and
instruments, each dated as of the Closing Date, fully executed and, if appropriate acknowledged,
and, if applicable, in proper form for recording:
7.2.1 Grant Deed. The Grant Deed conveying the Property to City;
7.2.2 Non -Foreign Affidavit. A Non -Foreign Affidavit in the form attached
hereto as Exhibit "B" ("Non -Foreign Affidavit");
7.2.3 State Affidavit. A California Franchise Tax Board Form 593-C ("State
Affidavit");
7.2.4 Owner's Affidavit. An owner's affidavit or Seller's certificate duly
executed by Seller in the form customarily required by title insurance companies in the county of
San Bernardino, in connection with the issuance of title insurance, to remove standard exceptions
for mechanics liens, the gap period from the latest title update of City's title insurance
commitment and Parties in possession;
7.2.5 Proof of Authority. Such proof of Seller's authority and authorization to
enter into this Agreement and the transaction contemplated hereby, and such proof of the power
and authority of the individuals executing or delivering any instruments, documents, or certificates
on behalf of Seller to act for and bind Seller as may be reasonably required by Title Insurer or
Escrow Agent; and
7.2.6 Other. Such other items, documents, and instruments as may be reasonably
required by City, Title Insurer, Escrow Agent, or otherwise in order to effectuate the provisions of
this Agreement and the Closing and/or otherwise to fulfill the covenants and obligations to be
performed by Seller at the CIosing pursuant to this Agreement.
7.3 Deliveries by City. On or before the Closing Date, City, at its sole cost and expense,
shall deliver or cause to be delivered into Escrow the following funds and the following items,
documents, and instruments, each dated as of the Closing Date, fully executed and, if appropriate
acknowledged, and, if applicable, in proper form for recording.
7.3.1 Purchase Price. Cash or other immediately available funds in an amount
equal to the unpaid sum of the Purchase Price (less the Deposit) and all of City's share of the
Closing Costs (as defined below) and otherwise sufficient to close the transaction contemplated in
this Agreement.
7.3.2 Proof of Authority. Such proof of City's authority and authorization to enter
into this Agreement and the transaction contemplated hereby, and such proof of the power and
authority of the individuals executing or delivering any instruments, documents, or certificates on
behalf of City to act for and bind City as may be reasonably required by Title Insurer or Escrow
Agent.
7.3.3 Other. Such other items, documents, and instruments as may be reasonably
required by Seller, Title Insurer, Escrow Agent, or otherwise in order to effectuate the provisions
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of this Agreement and the Closing and/or otherwise to fulfill the covenants and obligations to be
performed by City at the Closing pursuant to this Agreement.
7.4 Actions by Escrow Agent. Provided that Escrow Agent shall not have received
written notice from City or Seller of the failure of any condition to the Closing or of the termination
of the Escrow and this Agreement, when City and Seller have deposited into Escrow the documents
and funds required by this Agreement and Title Insurer is irrevocably and unconditionally prepared
and committed to issue the Owner's Title Policy in accordance with the terms of this Agreement,
Escrow Agent shall, in the order and manner indicated in this Agreement below, take the following
actions:
7.4.1 Recording. Cause the Grant Deed and any other documents customarily
recorded and/or that the Parties may mutually direct to be recorded in the Official Records and
obtain conformed copies of such items for distribution to City and Seller.
7.4.2 Funds. Disburse all funds as follows:
7.4.2.1 Pursuant to the Closing Statement (as defined below), retain for
Escrow Agent's own account all escrow fees and costs, disburse to Title Insurer the fees and
expenses incurred in connection with the issuance of the Owner's Title Policy, and disburse to any
other persons or entities entitled to receive such fees and costs the amount of any other Closing
Costs;
7.4.2.2 Disburse to Seller an amount equal to the Purchase Price, less or
plus the net debit or credit to Seller by reason of the prorations and allocations of Closing Costs
provided for in this Agreement; and
7.4.2.3 Disburse to the Party who deposited the same any remaining funds
in the possession of Escrow Agent after the payments pursuant to Sections 7.4.2.1 and 7.4.2.2
above have been completed.
7.4.3 Delivery of Documents. Deliver: (i) to Seller, one original of all documents
deposited into Escrow (other than the Grant Deed, the other documents recorded pursuant to the
terms of this Agreement, the Non -Foreign Affidavit, the State Affidavit and the General
Assignment), one copy of the Non -Foreign Affidavit, the State Affidavit and the General
Assignment, and one conformed copy of each document recorded pursuant to the terms of this
Agreement; and (ii) to City, one original of all documents deposited into Escrow (other than the
Grant Deed and the other documents recorded pursuant to the terms of this Agreement, but
including, without limitation, the Non -Foreign Affidavit and the State Affidavit), and the one
conformed copy of each document recorded pursuant to the terms of this Agreement. Originals of
any documents recorded at Closing shall be delivered after such recording as indicated thereon.
7.4.4 Owner's Title Policy. Cause Title Insurer to issue or be irrevocably and
unconditionally prepared and committed to issue the Owner's Title Policy to City.
7.5 Prorations/Apportionment.
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7.5.1 Method of Proration. Taxes and assessments affecting the Property shall be
prorated between City and Seller as of the Closing Date based on a 360-day year. All non -
delinquent real estate taxes and assessments on the Property shall be prorated based on the actual
current tax bill, but if such tax bill has not yet been received by Seller by the Closing Date or if
supplemental taxes are assessed after the Closing for the period prior to the Closing, the Parties
shall make any necessary adjustment after the Closing by cash payment to the Party entitled to the
same so that Seller shall have borne all real property taxes, including all supplemental taxes,
allocable to the period prior to the Closing and City shall bear all real property taxes, including all
supplemental taxes, allocable to the period from and after the Closing. If any real property taxes
or assessments or any expenses attributable to the Property and allocable to the period prior to the
Closing are discovered or billed after the Closing, the Parties shall make any necessary adjustment
after the Closing by cash payment to the Party entitled to the same within five (5) Business Days
following the discovery thereof or the receipt by any Party of the bill therefor, as the case may be,
so that Seller shall have borne all real property taxes, assessments and expenses allocable to the
period prior to the Closing and City shall bear all real property taxes, assessments and expenses
allocable to the period from and after the Closing.
7.5.2 Survival. The obligations under this Section 7.5 shall survive the Closing
and the delivery and recordation of the Grant Deed for the Property.
7.6 Closing Costs. Each Party shall pay its own costs and expenses arising in
connection with the Closing (including, without limitation, its own attorneys' and advisors' fees,
charges, and disbursements), except the following costs ("Closing Costs"), which shall be
allocated between the Parties as follows:
7.6.1 Escrow Agent's escrow fees and costs shall be shared equally by City and
Seller;
7.6.2 The cost of the Owner's Title Policy attributable to the standard coverage
portion shall be paid by Seller;
7.6.3 The cost of the Owner's Title Policy attributable to the extended coverage
portion shall be paid by City;
7.6.4 The cost of any items required to be provided by Seller pursuant to Section
4.2.2, shall be paid by Seller, and the costs of any other endorsements to the Owner's Title Policy
shall be paid by City;
7.6.5 Seller shall pay the cost of any documentary transfer taxes in connection
with the recording of the Grant Deed;
7.6.6 Seller shall pay all recording costs for recording the Grant Deed; and
7.6.7 All other closing fees and costs shall be charged to and paid by City.
7.7 Closing Statement. Three (3) Business Days prior to the Closing Date, Escrow
Agent shall deliver to each of the Parties for their review and approval a preliminary closing
statement ("Preliminary Closing Statement") setting forth: (i) the proration amounts allocable to
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each of the Parties pursuant to Section 7.5; and (ii) the Closing Costs allocable to each of the
Parties pursuant to Section 7.6. Based on each of the Party's comments, if any, regarding the
Preliminary Closing Statement, Escrow Agent shall revise the Preliminary Closing Statement and
deliver a final, signed version of a closing statement to each of the Parties at the Closing ("Closing
Statement").
7.8 Deliveries Outside of Escrow. Upon the Closing, Seller shall deliver vacant, sole,
and exclusive possession of the Property to City, subject only to the Permitted Exceptions.
Effective immediately upon the Closing, any personal property remaining on the Property shall be
deemed abandoned and may be removed and disposed of by City at its sole cost and expense. This
Section 7.8 shall survive the Closing.
Section 8. SELLER'S COVENANTS, REPRESENTATIONS AND WARRANTIES.
Seller represents, and warrants to and agrees with City, as of the Agreement Date and as of the
Closing Date, as follows:
8.1 Seller's Authority; Validity of Agreements. Seller has full right, power, and
authority to sell the Property to City as provided in this Agreement and to carry out its obligations
under this Agreement. The individuals executing this Agreement and the instruments referenced
in this Agreement on behalf of Seller has/have the legal power, right, and actual authority to bind
Seller to the terms hereof and thereof. This Agreement is, and all other instruments, documents
and agreements to be executed, and delivered by Seller in connection with this Agreement shall
be, duly authorized, executed, and delivered by Seller and the valid, binding, and enforceable
obligations of Seller (except as enforcement may be limited by bankruptcy, insolvency, or similar
laws) and do not, and as of the Closing Date will not result in any violation of, or conflict with, or
constitute a default under, any provisions of any agreement of Seller or any mortgage, deed of
trust, indenture, lease, security agreement, or other instrument, covenant, obligation, or agreement
to which Seller or the Property is subject, or any judgment, law, statute, ordinance, writ, decree,
order, injunction, rule, ordinance, or governmental regulation or requirement affecting Seller or
the Property.
8.2 No Third -Party Rights. Except as disclosed in the Title Report, Seller is not aware
of any leases or occupancy agreements that grant third -parties any possessory or -rights to use all
or any part of the Property.
8.3 Litigation. Seller is not aware of (i) any actions, investigations, suits, or
proceedings pending or threatened that affect the Property, the ownership or operation thereof, or
the ability of Seller to perform its obligations under this Agreement, and (ii) there are no
judgments, orders, awards, or decrees currently in effect against Seller with respect to the
ownership or operation of the Property that have not been fully discharged prior to the Effective
Date of this Agreement.
8.4 No Violations of Environmental Laws. To Seller's knowledge and except as
disclosed in the Property Materials: (i) the Property is not in, nor has it been or is it currently under
investigation for violation of any federal, state, or local law, ordinance, or regulation relating to
industrial hygiene, worker health and safety, or to the environmental conditions in, at, on, under,
or about the Property, including, but not limited to, soil and groundwater conditions
("Environmental Laws"); (ii) the Property has not been subject to a deposit of any Hazardous
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Substance; (iii) neither Seller nor any third -party has used, generated, manufactured, stored, or
disposed in, at, on, or under the Property any Hazardous Substance; and (iv) there is not now in,
on, or under the Property any underground or above ground storage tanks or surface
impoundments, any asbestos containing materials, or any polychlorinated biphenyls used in
hydraulic oils, electrical transformers, or other equipment. Seller hereby assigns to City as of the
Closing all claims, counterclaims, defenses, and actions, whether at common law or pursuant to
any other applicable federal, state or other laws that Seller may have against any third -party or
Parties relating to the existence or presence of any Hazardous Substance in, at, on, under, or about
the Property. For purpose of this Agreement, the term "Hazardous Substance" shall include any
wastes, materials, substances, pollutants, and other matters regulated by Environmental Laws.
8.5 No Other Commitments. Except as may be disclosed in the Title Report, Seller has
not made any commitment or representation to any governmental authority, or any adjoining or
surrounding property owner, that would in any way be binding on City or would interfere with
City's ability to develop and improve the Property for residential, commercial, or retail purposes,
and Seller shall not make any such commitment or representation that would affect all or any
portion of the Property without City's written consent.
8.6 Property Materials. Seller is not aware of any material defects, deficiencies, or
inaccuracies in any of the Property Materials.
8.7 Permits and Approvals. To Seller' s knowledge, all work performed on the Property
by or at the request of Seller including, without limitation, brush removal, has been performed in
material compliance with all applicable laws, rules and regulations and pursuant to all required
permits and approvals.
8.8 Survival. All of the representations, warranties, and agreements of Seller set forth
in this Agreement shall be true upon the Effective Date of this Agreement, shall be deemed to be
repeated at and as of the Closing Date, and shall survive the delivery of the Grant Deed and the
Closing for a period of one (1) year. Prior to a termination of this Agreement, Seller shall not take
any action, fail to take any required action, or willfully allow or consent to any action that would
cause any of Seller's representations or warranties to become untrue. If any representation or
warranty of Seller was true as of the Effective Date of this Agreement, but is not true as of the
Closing Date, then Seller shall disclose this changed fact to City in writing. So long as Seller
makes the foregoing disclosure and the change of circumstances regarding the representation or
warranty did not arise due to the fault of Seller, then Seller shall not be in breach of this Agreement
due to the fact that the representation or warranty has become untrue as of the Closing Date;
provided, however, the fact that any representation or warranty under this Section 8 is untrue as of
the Closing Date shall still be a failure of a condition pursuant to Section 6.1.2. Notwithstanding
the foregoing, if City has actual knowledge of the incorrectness of any representation or warranty
set forth in this Section 8 as of the Close of Escrow and City has not elected to terminate this
Agreement as provided in this Agreement, then City will be deemed to have waived any claim
against Seller for the incorrectness of such representation or warranty.
Section 9. CITY'S REPRESENTATIONS AND WARRANTIES. City represents and
warrants to Seller, as of the Agreement Date and as of the Closing Date, as follows:
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9.1 City's Authority; Validity of Agreements. City has full right, power, and authority
to purchase and acquire the Property from Seller as provided in this Agreement and to carry out
its obligations hereunder. The individuals executing this Agreement and the instruments
referenced in this Agreement on behalf of City has/have the legal power, right, and actual authority
to bind City to the terms of this Agreement and such instruments and documents. This Agreement
is, and all other instruments, documents, and agreements to be executed and delivered by City in
connection with this Agreement shall be, duly authorized, executed, and delivered by City and the
valid, binding, and enforceable obligations of City (except as enforcement may be limited by
bankruptcy, insolvency, or similar laws) and do not, and as of the Closing Date will not, violate
any provision of any law, statute, ordinance, rule, regulation, agreement or judicial order to which
City is a Party or to which City is subject.
9.2 Survival. All of the representations, warranties, and agreements of City set forth in
this Agreement shall be true upon the Effective Date of this Agreement, shall be deemed to be
repeated at and as of the Closing Date and shall survive the delivery of the Grant Deed and the
Closing for a period of one (1) year. Prior to a termination of this Agreement, City shall not take
any action, fail to take any required action, or willfully allow or consent to any action that would
cause any of City's representations or warranties to become untrue.
Section 10. AS -IS. THE PARTIES HEREBY ACKNOWLEDGE AND AGREE AS
FOLLOWS: (A) EXCEPT AS MAY BE SPECIFICALLY SET FORTH IN THIS AGREEMENT,
THE DEED, AND/OR ANY OTHER DOCUMENT OR INSTRUMENT DELIVERED BY
SELLER AT CLOSING ("EXPRESS REPRESENTATIONS"), NEITHER SELLER NOR ANY
OF ITS AGENTS, REPRESENTATIVES, BROKERS, OFFICERS, DIRECTORS,
SHAREHOLDERS, MEMBERS, OR EMPLOYEES HAS MADE OR WILL MAKE ANY
REPRESENTATIONS OR WARRANTIES OF ANY KIND WHATSOEVER, WHETHER
ORAL OR WRITTEN, EXPRESS OR IMPLIED, WITH RESPECT TO THE PROPERTY; AND
(B) EXCEPT AS MAY BE SPECIFICALLY SET FORTH IN THIS AGREEMENT, THE
PROPERTY IS BEING SOLD TO CITY IN ITS PRESENT "AS IS" CONDITION SUBJECT
TO THE EXPRESS REPRESENTATIONS. SUBJECT TO THE EXPRESS
REPRESENTATIONS AND THE TERMS OF THIS AGREEMENT, CITY WILL BE
AFFORDED THE OPPORTUNITY TO MAKE ANY AND ALL INSPECTIONS OF THE
PROPERTY AND SUCH RELATED MATTERS AS CITY MAY REASONABLY DESIRE
AND, ACCORDINGLY, SUBJECT TO THE EXPRESS REPRESENTATIONS, CITY WILL
RELY SOLELY ON ITS OWN DUE DILIGENCE AND INVESTIGATIONS IN PURCHASING
THE PROPERTY.
Section 11. RISK OF LOSS.
11.1 Condemnation. If, prior to any Closing, all or any portion of the Property is taken
by condemnation or eminent domain (or is the subject of a pending or contemplated taking which
has not been consummated), Seller shall immediately notify City in writing of such fact. In such
event, City shall have the option to terminate this Agreement upon written notice to Seller given
within ten (10) Business Days after receipt of such notice from Seller, in which event the Deposit
shall be returned to City. Notwithstanding the foregoing, City's failure to provide written notice
of City's election to terminate within such ten (10) Business Day period shall be deemed City's
election to terminate this Agreement. Prior to any termination or deemed termination of this
Agreement, City shall have the right to participate in any proceedings and negotiations with respect
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to the taking and any transfer in lieu of taking (and Seller shall not consummate any transfer in
lieu of taking without City's prior written consent, which consent shall not be unreasonably
withheld, conditioned or delayed). If City waives the right to terminate this Agreement and elects
to proceed with the Closing, then (i) Seller, at, and as a condition precedent to City's obligation to
proceed with, the Closing, must: pay to City (or direct Escrow Agent to credit City against the
Purchase Price for) the amount of all awards for the taking (and any consideration for any transfer
in lieu of taking) actually received by Seller; and assign to City by written instrument reasonably
satisfactory to City all rights or claims to any future awards for the taking (and any consideration
for any transfer in lieu of taking); and (ii) the Parties shall proceed to the Closing pursuant to the
terms hereof without further modification of the terms of this Agreement.
11.2 Casualty. Prior to the Closing and notwithstanding the pendency of this Agreement,
the entire risk of loss or damage by earthquake, hurricane, tornado, flood, landslide, fire, sinkhole,
contamination by hazardous materials or other casualty shall be borne and assumed by Seller. If,
prior to the Closing, any portion of the Property is damaged as a result of any earthquake,
hurricane, tornado, flood, sinkhole, landslide, fire, contamination by hazardous materials or other
casualty, Seller shall immediately notify City in writing of such fact. In such event, City shall
have the option to terminate this Agreement upon written notice to Seller given within ten (10)
Business Days after receipt of any such notice from Seller, in which event the Deposit shall be
returned to City. Notwithstanding the foregoing, City's failure to provide written notice of City's
election to terminate within such ten (10) Business Day period shall be deemed City's election to
terminate this Agreement. Prior to any termination or deemed termination of this Agreement, City
shall have the right to participate in any adjustment of the insurance claim. If City waives the right
to terminate this Agreement and elects to proceed with the Closing, then (i) Seller, at, and as a
condition precedent to City's obligation to proceed with, the Closing, must either: pay to City (or
direct Escrow Agent to credit City against the Purchase Price for) the amount of any insurance
proceeds actually received by Seller plus the amount of any deductible under Seller's insurance;
or if no insurance proceeds have been received by Seller, assign to City by written instrument
reasonably satisfactory to City all rights or claims to the insurance proceeds and credit City against
the Purchase Price for any deductible payable under Seller's insurance policy; and (ii) the Parties
shall proceed to the Closing pursuant to the terms hereof without further modification of the terms
of this Agreement.
Section 12. REMEDIES.
12.1 Default by Seller. If Seller shall breach any of the terms or provisions of this
Agreement or otherwise fail to perform any of Seller's obligations under this Agreement at or prior
to Closing, and if such failure continues without cure by Seller for five (5) Business Days after
City provides Seller and Escrow Agent with written notice thereof (a "Seller Default"), and
provided City is not then in default, then City may, as City's sole remedies for such failure, but
without limiting City's right to recover attorneys' fees pursuant to Section 14.13 below: (i) waive
the effect of such matter —and proceed to consummate this transaction; (ii) cancel this Agreement
and receive a full refund of the Deposit and recover from Seller the reasonable out-of-pocket
expenses incurred by City related to the Property and this transaction, which amounts shall be
payable by Seller to City within five (5) Business Days following receipt by Seller of written
request therefor from City together with copies of invoices evidencing such expenses; or (iii)
proceed with any remedies available to City at law or in equity, which may, without limitation,
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include the bringing of an action against Seller for specific performance and/or recovery of the
Deposit and any other damages suffered or incurred by City as a result of any breach or failure by
Seller to perform any of Seller's obligations under this Agreement.
12.2 Default by City. IF CITY SHALL BREACH ANY OF THE TERMS OR
PROVISIONS OF THIS AGREEMENT OR OTHERWISE FAIL TO PERFORM ANY OF
CITY'S OBLIGATIONS UNDER THIS AGREEMENT AND IF SUCH FAILURE
CONTINUES WITHOUT CURE BY CITY FOR FIVE (5) BUSINESS DAYS AFTER SELLER
PROVIDES CITY AND ESCROW AGENT WITH WRITTEN NOTICE THEREOF, AND
PROVIDED SELLER IS NOT THEN IN DEFAULT, THEN SELLER MAY WAIVE SUCH
BREACH AND PROCEED TO CONSUMMATE THIS TRANSACTION IN ACCORDANCE
WITH THE TERMS HEREOF, OR SELLER MAY, AS ITS EXCLUSIVE REMEDY (BUT
WITHOUT LIMITING SELLER'S RIGHT TO RECOVER ATTORNEYS' FEES PURSUANT
TO SECTION 14.13 BELOW), CANCEL THIS AGREEMENT AND RETAIN THE DEPOSIT
AS LIQUIDATED DAMAGES AND AS CONSIDERATION FOR THE ACCEPTANCE OF
THIS AGREEMENT AND FOR TAKING THE PROPERTY OFF THE MARKET, AND NOT
AS A PENALTY. CITY AND SELLER HAVE DETERMIINED AND HEREBY AGREE THAT
IT WOULD BE IMPRACTICAL OR EXTREMELY DIFFICULT, IF NOT IMPOSSIBLE, TO
ASCERTAIN WITH ANY DEGREE OF CERTAINTY THE AMOUNT OF DAMAGES THAT
WOULD BE SUFFERED BY SELLER IF CITY FAILS TO PERFORM ANY OF ITS
OBLIGATIONS IN ACCORDANCE WITH THE PROVISIONS OF THIS AGREEMENT, AND
THE PARTIES AGREE THAT A REASONABLE ESTIMATE OF SUCH DAMAGES UNDER
THE CIRCUMSTANCES IS AN AMOUNT EQUAL TO THE DEPOSIT. ACCORDINGLY,
CITY AND SELLER AGREE THAT IF CITY BREACHES ANY OF ITS OBLIGATIONS
UNDER THIS AGREEMENT OR OTHERWISE DEFAULTS HEREUNDER, SELLER MAY
RETAIN THE DEPOSIT AS LIQUIDATED DAMAGES. THE PAYMENT AND RETENTION
OF THE DEPOSIT AS LIQUIDATED DAMAGES IS NOT INTENDED AS A FORFEITURE
OR PENALTY WITHIN THE MEANING OF CALIFORNIA CIVIL CODE SECTIONS 3275
OR 3369, BUT IS INTENDED TO CONSTITUTE LIQUIDATED DAMAGES TO SELLER
PURSUANT TO CALIFORNIA CIVIL CODE SECTIONS 1671, 1676 AND 1677.
Seller's Initials
Section 13. BROKERS. Seller shall be responsible for the costs of any brokerage fees
associated with this transaction. Seller shall indemnify, defend, protect, and hold City harmless
for, from, and against any and all Claims associated with brokerage fees by reason of any breach
or inaccuracy of the representation, warranty, and agreement of Seller contained in this Section.
The provisions of this Section shall survive the Closing or earlier termination of this Agreement.
Section 14. MISCELLANEOUS PROVISIONS.
14.1 Entire Agreement. This Agreement, including the exhibits attached hereto,
constitutes the entire agreement between City and Seller pertaining to the subject matter hereof
and supersedes all prior agreements, understandings, letters of intent, term sheets, negotiations,
and discussions, whether oral or written, of the Parties, and there are no warranties, representations,
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or other agreements, express or implied, made to either Party by the other Party in connection with
the subject matter hereof except as specifically set forth in this Agreement or in the documents
delivered pursuant hereto or in connection herewith.
14.2 Modification; Waiver. No supplement, modification, waiver, or termination of this
Agreement shall be binding unless executed in writing by the Party to be bound thereby. No
waiver of any provision of this Agreement shall be deemed or shall constitute a waiver of any other
provision hereof (whether or not similar), nor shall such waiver constitute a continuing waiver
unless otherwise expressly provided.
14.3 Notices. All notices, consents, requests, reports, demands or other communications
hereunder (collectively, "Notices") shall be in writing and may be given personally, by registered
or certified mail, by electronic mail, by courier, or by Federal Express (or other reputable overnight
delivery service) for overnight delivery, as follows: -
To City:
To Seller:
To Escrow Agent:
City of Redlands, a municipal corporation
P.O. Box 3005
35 Cajon Street, Suite 222
Redlands, CA 92373
Attention: Jeanne Donaldson, City Clerk
Telephone: (909) 798-7531
Email: jdonaldson(cityofredlands.org
Cathy A. Macknet, Kenneth D. Macknet II and
Mark R. Macknet
25815 Barton Road, Suite 101
Loma Linda, CA 92354
Telephone: (909) 363-6238 (Mark R. Macknet)
Email: mmacknetAmac.com (Mark R. Macknet)
First American Title
901 Via Piemonte, Suite 150
Ontario, CA 91764
Attention: Kelly Simoneau
Telephone: (909) 889-0311
Email: ksimoneau(firstam.com
Or to such other address or such other person as the addressee Party shall have last designated by
Notice to the other Party and Escrow Agent. All Notices shall be deemed to have been given three
(3) days following deposit in the United States Postal Service (postage prepaid) or, upon receipt,
if sent by overnight delivery service, courier, facsimile transmission (so long as confirmed by the
appropriate automatic confirmation page), electronic mail (so long as receipt is acknowledged or
otherwise confirmed), or personally delivered. Notice to a Party shall not be effective unless and
until each required copy of such Notice is given. The inability to deliver a Notice because of a
changed address of which no Notice was given or an inoperative facsimile number for which no
Notice was given of a substitute number, or any rejection or other refusal to accept any Notice,
shall be deemed to be the receipt of the Notice as of the date of such inability to deliver or rejection
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or refusal to accept. Any Notice to be given by any Party may be given by legal counsel for such
Party. Telephone numbers are provided in this Agreement for convenience only and shall not alter
the manner of giving Notice set forth in this Section 14.3.
14.4 Expenses. Subject to the provision for payment of the Closing Costs in accordance
with the terms of Section 7.6 of this Agreement and of any other provision of this Agreement,
whether or not the transaction contemplated by this Agreement shall be consummated, all fees and
expenses incurred by any Party hereto in connection with this Agreement shall be borne by such
Party.
14.5 Severability. Any provision or part of this Agreement that is invalid or
unenforceable in any situation in any jurisdiction shall, as to such situation and such jurisdiction,
be ineffective only to the extent of such invalidity and shall not affect the enforceability of the
remaining provisions hereof or the validity or enforceability of any such provision in any other
situation or in any other jurisdiction.
14.6 Successors and Assigns. Neither Seller nor City shall assign its rights under this
Agreement without the consent of the other Party, which consent shall not be unreasonably
withheld or delayed. Notwithstanding any such assignment, no assignment shall relieve the
assignor of any obligations or liability under this Agreement. Subject to the foregoing, all of the
Parties' rights, duties, benefits, liabilities, and obligations under this Agreement shall inure to the
benefit of, and be binding upon, their respective successors and assigns.
14.7 Counterparts. This Agreement may be executed in as many counterparts as may be
deemed necessary and convenient, and by the different Parties hereto on separate counterparts,
each of which, when so executed, including, without limitation, by .pdf scanned counterparts of
any initialed or executed pages delivered via electronic mail, shall be deemed an original, but all
such counterparts shall constitute one and the same instrument.
14.8 Governing Law; Jurisdiction. This Agreement shall be governed by and construed
under the laws of the State of California without regard to conflicts -of -laws principles that would
require the application of any other law. Each Party hereby consents to the exclusive jurisdiction
of any court of competent jurisdiction in San Bernardino County in any action related to or arising
under this Agreement.
14.9 Headings. The Section headings of this Agreement are for convenience of
reference only and shall not be deemed to modify, explain, restrict, alter, or affect the meaning or
interpretation of any provision hereof.
14.10 Time of Essence. Time shall be of the essence with respect to all matters
contemplated by this Agreement.
14.11 Further Assurances. In addition to the actions recited in this Agreement and
contemplated to be performed, executed, and/or delivered by Seller and City, during the term of
this Agreement and after the Closing, Seller and City agree to perform, execute, and/or deliver or
cause to be performed, executed, and/or delivered any and all such further acts, instruments, deeds,
and assurances as may be reasonably required to consummate the transaction contemplated hereby.
In furtherance of the foregoing, so long as City is not in default under the terms of this Agreement,
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Seller will cooperate, as reasonably needed, and at no cost to Seller, in City's due diligence review
process, which shall include but not be limited to Seller's consent to City's unrestricted access to
agencies, representatives, tenants, consultants and other parties familiar with the Property and the
execution and delivery of such applications or other documents as reasonably requested by City.
14.12 Construction. As used in this Agreement, the masculine, feminine, and neuter
gender and the singular or plural shall each be construed to include the other whenever the context
so requires. This Agreement shall be construed as a whole and in accordance with its fair meaning,
without regard to any presumption or rule of construction causing this Agreement or any part of it
to be construed against the Party causing this Agreement to be written. The Parties acknowledge
that each has had a full and fair opportunity to review this Agreement and to have it reviewed by
counsel. If any words or phrases in this Agreement have been stricken, whether or not replaced
by other words or phrases, this Agreement shall be construed (if otherwise clear and unambiguous)
as if the stricken matter never appeared and no inference shall be drawn from the former presence
of the stricken matters in this Agreement or from the fact that such matters were stricken.
14.13 Attorneys' Fees. If either Party brings an action or proceeding against the other
Party to enforce or interpret any of the covenants, conditions, agreements, or provisions of this
Agreement, the prevailing Party in such action or proceeding shall be awarded all costs and
expenses of such action or proceeding, including, without limitation, attorneys' fees (including
fees for a Party's use of in-house counsel), charges, disbursements, and the fees and costs of expert
witnesses. If any Party secures a judgment in any such action or proceeding, then any costs and
expenses (including, but not limited to, attorneys' fees and costs) incurred by the prevailing Party
in enforcing such judgment, or any costs and expenses (including, but not limited to, attorneys'
fees and costs) incurred by the prevailing Party in any appeal from such judgment in connection
with such appeal shall be recoverable separately from and in addition to any other amount included
in such judgment. The preceding sentence is intended to be severable from the other provisions
of this Agreement, and shall survive and not be merged into any such judgment. This Section shall
survive Closing and any earlier termination of this Agreement.
14.14 Business Days. As used in this Agreement, the term "Business Day" or "Business
Days" shall mean a day that is not a Saturday, Sunday, or legal holiday. If the date for the
performance of any covenant or obligation under this Agreement shall fall on a Saturday, Sunday,
or legal holiday, the date for performance thereof shall be extended to the next Business Day.
Similarly, if the day for the performance of any covenant or obligation under this Agreement
involving Escrow Agent shall fall on a Business Day on which Escrow Agent is closed for business
to the public, the date for performance thereof shall be extended to the next Business Day on which
Escrow Agent is open for business to the public.
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The Parties have executed this Agreement as of the day and year first written above.
CITY OF REDLANDS,
a municipal co oration
By:
ddie Tejeda, Mayor
ATTEST:
Donaldson, City Clerk
ESCROW AGENT:
CATHY A. MACKNET,
a Joint Tenant in Common
By: (
A. 2a
KENNETH D. MACKNET,
a Joint Tenant in Common
By:
4a-4£1 I',�ca1
MARK R. MAC KNET
a Joint Tenant in Common
The undersigned Escrow Agent hereby accepts the foregoing Purchase and Sale Agreement and
Joint Escrow Instructions, agrees to act as Escrow Agent under this Agreement in strict accordance
with its terms, agrees to insert as the "Agreement Date" on page 1 of this Agreement, if not
otherwise dated, the latest date this Agreement was signed by Seller and City and delivered to
Escrow Agent, and agrees to comply with the applicable provisions of the Internal Revenue Code
with respect to the transactions contemplated hereby.
FIRST AMERICAN TITLE
Date: By:
Name: Kelly Simoneau
Title: Senior Commercial Escrow Officer
19
I;\cmo\Agreements\Helen Court Purchase and Sale Agreement-FY22-0138.docx-la
LIST OF EXHIBITS
EXHIBIT "A" GRANT DEED
EXHIBIT "B" NON -FOREIGN AFFIDAVIT
EXHIBIT "A"
GRANT DEED
RECORDING REQUESTED BY:
WHEN RECORDED MAIL TO:
City of Redlands
P.O. Box 3005
Redlands, California 92373
Attention: City Clerk
(Space Above for Recorder's Use)
APNNumbers 0300-451-13, -14, -24,-25-0000
GRANT DEED
The undersigned Grantor declares that Documentary Transfer Tax is not shown pursuant
to Section 11922 of the California Revenue and Taxation Code, as amended.
FOR GOOD AND VALUABLE CONSIDERATION, the receipt and sufficiency of which
is hereby acknowledged, CATHY A. MACKNET, KENNETH D. MACKNET II, and MARK R.
MACKNET, Joint Tenants in Common (the "Grantor"), hereby grants to CITY OF REDLANDS,
a municipal corporation, the real property in the City of Redlands, County of San Bernardino, State
of California, described in Exhibit "A" attached to and incorporated in this Agreement by this
reference.
THIS GRANT AND CONVEYANCE IS MADE AND ACCEPTED SUBJECT TO
COVENANTS, CONDITIONS, RESTRICTIONS, RESERVATIONS, RIGHTS OF WAY AND
EASEMENTS NOW OF RECORD.
[signature page follows]
MAIL TAX STATEMENTS TO:
City of Redlands
P.O. Box 3005
Redlands, California 92373
Attention: City Clerk
IN WITNESS WHEREOF, the Grantor has executed this Grant Deed as of
, 2023.
GRANTOR:
CATHY A. MACKNET,
a Joint Tenant in Common
By:
KENNETH D. MACKNET,
a Joint Tenant in Common
By:
MARK R. MACKNET
a Joint Tenant in Common
By:
FORM OF CERTIFICATE OF ACCEPTANCE
This is to Certify that the interest in real property conveyed by the Grant Deed dated
, 2023, from Cathy A. Macknet, Kenneth D. Macknet II, and Mark R. Macknet,
Joint Tenants In Common, to the City of Redlands, a municipal corporation, is hereby accepted by
the undersigned officer or agent on behalf of the City Council of the City of Redlands pursuant to
the authority conferred by Resolution No. 7893 of the City Council of the City of Redlands adopted
on July 17, 2018, and the grantee consents to recordation thereof by its duly authorized officer.
Dated:
By:
Name: Eddie Tejeda
Title: Mayor
ATTEST:
Jeanne Donaldson, City Clerk
A notary public or other officer completing
this certificate verified only the identity of
the individual who signed the document to
which this certificate is attached, and not the
truthfulness, accuracy, or validity of that
document.
STATE OF CALIFORNIA )
COUNTY OF )
SS.
On , 2023 before me,
Notary Public, personally appeared , who
proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are
subscribed to the within instrument and acknowledged to me that he/she/they/executed the same
in his/her/their authorized capacity(ies) and that by his/her/their signature(s) on the instrument the
person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the
foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Notary Public
In and For Said County and State
EXHIBIT "A" TO GRANT DEED
LEGAL DESCRIPTION
0300-451-13-0000
PARCEL MAP 5422 PARCEL 1
0300-451-14-0000
PARCEL MAP 5422 PARCEL 2
0300-451-24-0000
PARCEL 4 OF PARCEL MAP NO. 5422, IN THE CITY OF REDLANDS, COUNTY OF SAN
BERNARDINO, STATE OF CALIFORNIA, AS PER MAP RECORDED IN BOOK 133 OF
PARCEL MAPS, PAGES 98 THROUGH 100, INCLUSIVE, IN THE OFFICE OF THE
COUNTY RECORDER OF SAID COUNTY, EXCEPTING THEREFROM THAT PORTION
BEING MORE PARTICULARLY DESCRIBED AS FOLLOWS: BEGINNING AT A POINT
ON THE EASTERLY LINE OF SAID PARCEL 4 LYING NORTH 00 DEG 50'53" WEST, A
DISTANCE OF 83.74 FEET FROM THE SOUTHEAST CORNER OF SAID PARCEL 4,
THENCE SOUTH 89 DEG 09'07" WEST ALONG A LINE PARALLEL WITH THE
SOUTHERLY LINE OF SAID PARCEL 4, A DISTANCE OF 485.11 FEET; THENCE SOUTH
0 DEG 50'53" EAST ALONG A LINE PARALLEL WITH THE EASTERLY LINE OF SAID
PARCEL 4, A DISTANCE OF 83.74 FEET; THENCE NORTH 89 DEG 09'07" EAST ALONG
SAID SOUTHERLY LINE, A DISTANCE OF 485.11 FEET TO SAID SOUTHEAST CORNER;
THENCE NORTH 0 DEG 50'53" WEST ALONG SAID EASTERLY LINE, A DISTANCE OF
83.74 FEET TO THE POINT OF BEGINNING; TOGETHER WITH THAT PORTION OF
PARCEL 3 OF PARCEL MAP NO. 4750, IN THE CITY OF REDLANDS, COUNTY OF SAN
BERNARDINO, STATE OF CALIFORNIA, AS PER MAP RECORDED IN BOOK 42 OF
PARCEL MAPS, PAGES 100 THROUGH 103, INCLUSIVE, IN THE OFFICE OF THE
COUNTY RECORDER OF SAID COUNTY, BEING MORE PARTICULARLY DESCRIBED
AS FOLLOW: BEGINNING AT A POINT ON THE EASTERLY LINE OF SAID PARCEL 4
LYING NORTH 00 50'53" WEST, A DISTANCE OF 83.74 FEET FROM THE SOUTHEAST
CORNER OF SAID PARCEL 4, THENCE NORTH 89 DEG 09'07" EAST, A DISTANCE OF
98.39 FEET TO A POINT ON A CURVE CONCAVE EASTERLY HAVING A RADIUS OF
480.00 FEET AND A RADIAL BEARING OF NORTH 85 DEG 08'54" EAST; THENCE
NORTHERLY ALONG THE ARC OF SAID CURVE THROUGH A CENTRAL ANGLE OF
01 DEG 40'22", AN ARC LENGTH OF 14.01 FEET; THENCE NORTH 03 DEG 10'44" WEST,
A DISTANCE OF 56.10 FEET TO THE BEGINNING OF A TANGENT CURVE CONCAVE
WESTERLY AND HAVING A RADIUS OF 270.00 FEET; THENCE NORTHERLY ALONG
THE ARC OF SAID CURVE THROUGH A CENTRAL ANGLE OF 27 DEG 09' 13 ", AN ARC
LENGTH OF 127.96 FEET; THENCE NORTH 30 DEG 19'57" WEST, A DISTANCE OF
123.10 FEET TO THE NORTHEAST CORNER OF SAID PARCEL 4; THENCE ALONG THE
SAID EASTERLY LINE OF PARCEL 4, SOUTH 0 DEG 50'53" EAST, A DISTANCE OF
299.12 FEET TO THE POINT OF BEGINNING
0300-451-25-0000
PARCEL 3 OF PARCEL MAP NO. 5422, IN THE CITY OF REDLANDS, COUNTY OF SAN
BERNARDINO, STATE OF CALIFORNIA, AS PER MAP RECORDED IN BOOK 133 OF
PARCEL MAPS, PAGES 98 THROUGH 100, INCLUSIVE, IN THE OFFICE OF THE
COUNTY RECORDER OF SAID COUNTY. TOGETHER WITH THAT PORTION OF
PARCEL 4 OF SAID PARCEL MAP NO. 5422, BEING MORE PARTICULARLY
DESCRIBED AS FOLLOWS: BEGINNING AT THE SOUTHEASTERLY CORNER OF SAID
PARCEL 4, THENCE SOUTH 89 DEG 09'07" WEST ALONG THE SOUTHERLY LINE OF
SAID PARCEL 4, A DISTANCE OF 485.11 FEET; THENCE NORTH 0 DEG 50'53" WEST
ALONG A LINE PARALLEL WITH THE EASTERLY LINE OF SAID PARCEL 4, A
DISTANCE OF 83.74 FEET; THENCE NORTH 89 DEG 09'07" EAST ALONG A LINE
PARALLEL WITH SAID SOUTHERLY LINE, A DISTANCE OF 485.11 FEET TO A POINT
ON SAID EASTERLY LINE; THENCE SOUTH 0 DEG 50'53" EAST ALONG SAID
EASTERLY LINE, A DISTANCE OF 83.74 FEET TO THE POINT OF BEGINNING; ALSO
TOGETHER WITH THAT PORTION OF PARCEL 3 OF PARCEL MAP NO. 4750, IN THE
CITY OF REDLANDS, COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, AS
PER MAP RECORDED IN BOOK 42 OF PARCEL MAPS, PAGES 100 THROUGH 103,
INCLUSIVE, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY, BEING
MORE PARTICULARLY DESCRIBED AS FOLLOWS: BEGINNING AT THE
SOUTHEASTERLY CORNER OF SAID PARCEL 4, THENCE NORTH 0 DEG 50'53' WEST
ALONG THE EASTERLY LINE OF SAID PARCEL 4, A DISTANCE OF 83.74 FEET;
THENCE NORTH 89 DEG 09'07" EAST, A DISTANCE OF 98.39 FEET TO A POINT ON A
CURVE CONCAVE EASTERLY HAVING A RADIUS OF 480.00 FEET AND A RADIAL
BEARING OF NORTH 85 DEG 08'54" EAST; THENCE SOUTHERLY ALONG THE ARC OF
SAID CURVE THROUGH A CENTRAL ANGLE OF 39 DEG 28'44", AN ARC LENGTH OF
330.74 FEET; THENCE SOUTH 89 DEG 09'07" WEST, A DISTANCE OF 228.94 FEET TO A
POINT ON THE WESTERLY LINE OF SAID PARCEL 3; THENCE NORTH 0 DEG 50'53"
WEST ALONG SAID WESTERLY LINE, A DISTANCE OF 213.05 FEET TO THE POINT OF
BEGINNING
Document No.
Recorded , 2023
STATEMENT OF TAX DUE AND REQUEST THAT TAX DECLARATION
NOT BE MADE A PART OF THE PERMANENT RECORD IN THE OFFICE
OF THE COUNTY RECORDER (PURSUANT TO SECTION 11922 REVENUE
AND TAXATION CODE)
TO: Recorder
County of San Bernardino
Request is hereby made in accordance with the provisions of the Documentary Transfer
Tax Act that the amount of the tax due not be shown on the original document which names:
Grantor: CATHY A. MACKNET, KENNETH D. MACKNET II, and MARK R.
MACKNET, Joint Tenants in Common
Grantee: CITY OF REDLANDS, a municipal corporation
The property described in the accompanying document is located in the City of Redlands,
County of San Bernardino.
The amount of tax due on the accompanying document is $ , computed on
the full value of the property conveyed.
(Signature of Grantor or Agent) CATHY A. MACKNET,
a Joint Tenant in Common
By:
KENNETH D. MACKNET,
a Joint Tenant in Common
By:
MARK R. MACKNET
a Joint Tenant in Common
By:
Note: After the permanent record is made, this form will be affixed to the conveying document
and returned with it.
EXHIBIT "B"
NON -FOREIGN AFFIDAVIT
STATE OF )
) ss.
County of )
The undersigned, as authorized agent of CATHY A. MACKNET, KENNETH D. MACKNET II,
and MARK R. MACKNET, Joint Tenants in Common ("Transferor"), after being duly sworn upon
his oath deposes and says that:
Section 1445 of the Internal Revenue Code provides that a transferee of a U.S. real property interest
must withhold tax if the transferor is a foreign person. To inform CITY OF REDLANDS, a
municipal corporation, ("Transferee"), that withholding of tax is not required upon the disposition of
Transferor's interest in a U.S. real property interest, the undersigned hereby certifies the following:
1. Transferor is not a non-resident alien, foreign corporation, foreign partnership, foreign trust,
foreign estate, or other foreign person within the meaning of § 1445 and § 7701 of the Internal
Revenue Code and the treasury regulations promulgated thereunder;
2. Transferor is not a disregarded entity as defined in Treas. Reg. § 1.1445-2(b)(2)(iii);
3. Transferor's U.S. taxpayer identification number is:
4. Transferor's business address is:
Transferor understands that this certification may be disclosed to the Internal Revenue Service by
Transferee and that any false statement contained in this Agreement could be punished by fine,
imprisonment, or both.
Under penalties of perjury Transferor declares that it has examined this certification and to the best
of its knowledge and belief this certification is true, correct, and complete. The undersigned agent
declares that he has the authority to sign this document on behalf of Transferor.
TRANSFEROR:
CATHY A. MACKNET, a Joint Tenant in Common
By:
KENNETH D. MACKNET, a Joint Tenant in Common
By:
MARK R. MACKNET, A Joint Tenant in Common
By:
A notary public or other officer completing this
certificate verified only the identity of the
individual who signed the document to which
this certificate is attached, and not the
truthfulness, accuracy, or validity of that
document.
STATE OF CALIFORNIA
ss.
COUNTY OF
On , 2023, before me,
, Notary Public, personally appeared
, who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s)
is/are subscribed to the within instrument and acknowledged to me that he/she/they/executed the same in
his/her/their authorized capacity(ies) and that by his/her/their signature(s) on the instrument the person(s),
or the entity upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing
paragraph is true and correct.
WITNESS my hand and official seal.
Notary Public
In and For Said County and State