HomeMy WebLinkAbout04 PURCHASE AND SALE AGREEMENT
Agenda Item_______
Reviewed:
AGENDA REPORT
City Manager_______
Finance Director_______
MEETING DATE:APRIL 7, 2026
TO:ALDO E. SCHINDLER, CITY MANAGER
FROM:BRIAN MONCRIEF, DEPUTY CITY MANAGER – REAL PROPERTY
SUBJECT:PURCHASE AND SALE AGREEMENT WITH CAZ LLC FORTHE
COMPETITIVE OFFERING OF150 E. FIRST STREET
SUMMARY:
Consideration ofa Purchase and Sale Agreement between CAZ LLCand the Cityof Tustin
for the sale of City-owned property located at150 E. First Street within Development Area
2 of the Downtown Commercial Core Specific Plan.
RECOMMENDATION:
Recommend the City Council:
1.Approve and authorize the City Manager to execute the Purchase and Sale Agreement
between CAZ LLCand the City in the form attached hereto, subject to any non-
substantive modifications as may be recommended by the City’s special real estate
counsel or the City Attorney; and
2.Authorize the City Manager to take all actions and to approve and execute all other
agreements, attachments and documents necessary or appropriate to complete the
transaction.
FISCAL IMPACT:
The purchase price for the property is $2,200,000. Final net proceeds will be deposited into
the City’s General Fund.
CORRELATION TO THE STRATEGIC PLAN:
Execution of the Purchase and Sale Agreementcontributes to the fulfillment of the City’s
Strategic Plan Goal A: Economic and Neighborhood Development. Specifically, this item
implements Strategy 14, which is to develop a strategic plan for Tustin’s development which
focuses on in-fill development in the Downtown Commercial Core and Red Hill Specific
Plan areas.
City Council AgendaReport
Purchase and Sale Agreement CAZ LLC
April 7, 2026
Page 2
BACKGROUND AND DISCUSSION:
On April 1, 2025, the City Council authorized staff to release a competitive offering for 0.4
acres of City-owned real property at 150 E. First Street (Site)within Development Area 2 of
the Downtown Commercial Core Specific Plan (DCCSP) pursuant to City Council Resolution
25-10.This Siteis located within the Downtown Mixed Use Land Use Designation. The
property was previously declared exempt surplus by the City Council through Resolution No.
25-02, and the City received a compliance letter from the Department of Housing and
Community Development (HCD) on February 7, 2025 pursuant to the Surplus Land Act.
On May 20, 2025, the City Council authorized the City Manager to negotiate and execute a
Listing Agreement for the Site with Professional Real Estate Services, Inc.(PRES) to market
the site.
On June 27, 2025, an Offering Memorandum (OM) for the Site was released by PRES.The
OM included a general overview of the Site and the proposed timeline and process for the
offering. The OM noted that the City “seeks to ground lease or sell the property to a qualified
Developer capable of delivering a high-quality project that furthers the vision of the Downtown
Commercial Core Specific Plan.”
On October 7, 2025, the City Council authorized staff to proceed with a final round of
negotiations for two (2) of the four (4) proposals identified as most viable and best aligned
with the City’s vision for the Site. Staff were also authorized to further reduce the number of
proposals that would ultimately be recommended to the City Council for consideration.
The Purchase and Sale Agreement (PSA) between CAZ LLC and the City is structured as
an “As-Is” sale transaction with the Site being conveyed in its current condition and for a
purchase price at fair market value for the proposed educational use as supported by an
independent appraisal. The PSA includes a detailed set of mutually agreed upon entitlement
and performance milestones that establish a clear timeline for CAZ LLC to obtain all required
entitlement approvals and proceed to closing. These provisions are intended to ensure
accountability, maintain steady progress, and preserve the City’s interests, while allowing
flexibility should unforeseen circumstances arise.
_______________________________ ________________________________
Brian Moncrief Jason Loya
Deputy City Manager – Real Property Management Analyst II
Attachments:
1. Location Map
2. Purchase and Sale Agreement between City of Tustin and CAZ, LLC
PURCHASE AND SALE AGREEMENT
AND JOINT ESCROW INSTRUCTIONS
THIS PURCHASE AND SALE AGREEMENT AND JOINT ESCROW
INSTRUCTIONS (the “Agreement”) is entered into as of ____________, 2026 (the “Effective
Date”), by and between the City of Tustin, a California municipal corporation (“City”), and CAZ
LLC, a California limited liability company (“Purchaser”). City and Purchaser are collectively
referred to herein as the “Parties.”
RECITALS
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A. City is owner of that certain real property located at 150 E. 1 Street, Tustin,
California, designated as Orange County Assessor’s Parcel Number 401-583-01, and more
particularly described in Exhibit A attached hereto and incorporated herein.
B. The Property is approximately 0.43 acres in size. The Property is improved with an
approximately 3,849 sq.ft. single story commercial building thereon.
C.The City Council has made a finding that the Property is “exempt surplus land”
pursuant to Government Code Section 54221(f)(1)(B) of the Surplus Land Act, as it is surplus land
that is less than one-half acre in area and is not contiguous to land owned by a state or local agency
that is used for open-space or low- and moderate-income housing purposes.
D. Purchaser agrees to purchase the Property, and City desires to sell the Property to
Purchaser, subject to the terms and conditions of this Agreement.
NOW, THEREFORE, for and in consideration of the mutual covenants and agreements
contained in this Agreement, and other good and valuable consideration, the receipt and adequacy
of which is hereby acknowledged by the Parties, City and Purchaser hereby agree as follows:
1. Incorporation of Recitals and Exhibits. The Recitals set forth above and the
Exhibits attached to this Agreement are each incorporated into the body of this Agreement as if
set forth in full.
2. Purchase and Sale.
2.1 Agreement to Buy and Sell Property. Subject to the terms and conditions
set forth herein, City agrees to sell to Purchaser, and Purchaser hereby agrees to acquire from City,
the following (collectively, the “Property”):
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(a) That certain real property commonly known as 150 E. 1 Street, Tustin,
California, and legally described on Exhibit A (the “Land”)
(b) Any buildings, structures, fixtures and other improvements affixed to or
located on the Land; and
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(c) to the extent such are assignable (but only to the extent City’s interest in
the foregoing items arise from City’s interest as fee title owner of the Land, and not such items
arising from City’s governmental powers and authority),
(i) all certificates, permits, approvals, development rights, consents,
exemptions, decisions, actions, entitlements, authorizations, licenses and any other
agreements issued by any governmental authority and affecting any part or all of the
Property;
(ii) all rights, title and interest which City may have in any adjacent
streets, alleys or rights-of-way, mineral and water rights, easements, egress and ingress
agreements, covenants, and any conditions and restrictions to the extent that the same
pertain to or are appurtenant to the Land; and;
(iii) all civil engineering, soil engineering, landscape, environmental and
architectural plans and reports relating to the Property prepared for City prior to Closing.
2.2 Purchase Price. The purchase price for the Property to be paid by
Purchaser to City (the “Purchase Price”) is Two Million Two Hundred Thousand Dollars
($2,200,000.00). The Purchase Price shall be paid in immediately available funds at the Closing
to the City.
2.3 Deposit. Purchaser shall deposit into the Escrow the sum of One Hundred
Fifty Thousand Dollars ($150,000) (the “Deposit”) within three (3) business days of the opening
of Escrow. The Deposit shall be applicable toward the Purchase Price. If this Agreement is not
terminated prior to the expiration of the Due Diligence Contingency Period, Seventy-Five
Thousand Dollars ($75,000) of the Deposit and any interest earned thereon shall thereupon
become nonrefundable to Purchaser. The remainder of the Deposit and any interest earned
thereon shall become nonrefundable to Purchaser upon Final Approval of the CUP Application
(as defined in Section 6.3 hereof). Notwithstanding the foregoing, if this Agreement is
terminated prior to Closing due to City’s default or the failure of any of the Purchaser’s
Conditions to Closing or City’s Conditions to Closing as set forth in Sections 5.2 and 5.3 hereof,
Purchaser shall be entitled to a full refund of the Deposit. For the avoidance of doubt, if the Final
Approval of the CUP has not occurred on or before the Entitlement Deadline, and this
Agreement terminates as provided in Section 6.4 hereof, Purchaser shall receive a full refund of
the Deposit.
2.4 Independent Consideration. As independent consideration for City’s
entering into this Agreement to sell the Property to Purchaser, Purchaser shall deliver the sum of
One Hundred Dollars ($100.00) to City through Escrow (“Independent Consideration”). City
shall retain the Independent Consideration whether or not the Close of Escrow occurs.
3. Escrow.
3.1 Escrow Account. Within five (5) business days after the Effective Date,
Purchaser will open an escrow account (the “Escrow”) maintained by Lawyer’s Title Insurance
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Company (the “Escrow Holder”). Escrow Holder shall perform all escrow and title services in
connection with this Agreement.
3.2 Opening of Escrow. Within five (5) business days after the Effective
Date, the Parties will deposit into Escrow the fully executed Agreement, or executed counterparts
thereto. The date such fully executed Agreement is received by Escrow Holder will be deemed the
“Opening of Escrow,” and Escrow Holder will give written notice to the Parties of such
occurrence.
3.3 Satisfaction of Due Diligence Contingency. Purchaser will have ninety
(90) days from Opening of Escrow (the “Due Diligence Contingency Period”) to complete physical
inspections of the Property and due diligence related to the purchase of the Property. City shall
provide to Purchaser copies of all reasonably available and known documents relating to the
ownership and use of the Property, including but not limited to plans, permits and reports (such as
environmental, engineering and land surveys) that City has in its possession, not later than ten (10)
days following the Effective Date.
3.4 Due Diligence Inspections. During the Due Diligence Contingency
Period, Purchaser and its agents, contractors and employees shall have the right to enter upon the
Property for the purpose of making inspections or to perform environmental testing, at Purchaser’s
sole risk, cost and expense. All of such entries upon the Property shall be during normal business
hours and after at least twenty-four (24) hours prior notice to City, and City or City’s agent shall
have the right to accompany Purchaser during any activities performed by Purchaser on the
Property. At City’s request, Purchaser shall provide City with a copy of the results of any
environmental tests and inspections made by Purchaser, at no cost to City. If any inspection or
test disturbs the Property, Purchaser will restore the Property to the substantially the same
condition as existed before the inspection or test. Purchaser shall defend, indemnify and hold City
harmless from and against any and all losses, costs, damages, claims or liabilities, including but
not limited to, mechanic’s and materialmen’s’ liens, arising out of or in connection with
Purchaser’s inspection of the Property as permitted pursuant to this Section 3.4. City may
additionally require Purchaser or its agents, contractors and employees to provide a policy of
commercial general liability insurance from an insurance company reasonably acceptable to City,
covering City as an additionally insured party, with a policy limit of not less than $2,000,000, as
a condition of entry upon the Property for such purposes.
3.5 Termination Upon Due Diligence Disapproval.Purchaser shall have the
right, in its sole discretion, to terminate this Agreement for any reason (or no reason) by written
notice to City prior to the expiration of the Due Diligence Contingency Period. If Purchaser timely
sends such a termination notice, this Agreement shall terminate, the Deposit shall be returned to
Purchaser, and neither Party shall have any further rights or obligations hereunder except those
which expressly survive the termination hereof. In the event of Purchaser’s termination of this
Agreement pursuant to this Section 3.5, Purchaser shall be responsible for the costs of Escrow and
any cancellation fees.
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4. Property Disclosure Requirements.
4.1 Condition of Title/Preliminary Title Report. Escrow Holder shall
deliver a Preliminary Title Report for the Property (the “Preliminary Report”) to Purchaser within
ten (10) days after the Opening of Escrow. Purchaser shall have thirty (30) days from receipt of
the Preliminary Report to approve or disapprove the condition of title to the Property; provided
that all existing deeds of trust, mechanic’s liens and other financial liens and encumbrances, if any,
shall be paid off and removed from title concurrently with or prior to the Closing. If there are any
changes to the Preliminary Report prior to Closing, Purchaser shall have ten (10) days after receipt
of the revised Preliminary Report to approve or disapprove such changes.
4.2 Environmental and Natural Hazards Disclosure. City agrees to make
any disclosures relating to hazardous substances located on or beneath the Property and natural
hazards affecting the Property, as required by law. City shall provide Purchaser with all documents
reasonably known to City pertaining to the environmental condition of the Property.
4.3 Surplus Land Act Compliance. Prior to the date of this Agreement City
has received from the California Department of Housing and Community Development (“HCD”)
a letter of determination that the sale of the Property is exempt from the requirements of the Surplus
Land Act, Government Code Section 54220, et seq. City shall take all other actions required
pursuant to the Surplus Land Act and the Surplus Land Act Guidelines which are required, if any,
for the sale of the Property to Purchaser pursuant to this Agreement. Upon Purchaser’s request,
City shall provide copies of the notice of determination by HCD confirming that the conveyance
of the Property is exempt from the requirements of the Surplus Land Act. Purchaser acknowledges
that City’s obligations under the Surplus Land Act are statutory obligations and nothing in this
Agreement shall limit City’s ability to take actions necessary to maintain compliance with
Government Code §54220, et seq.
5. Closing and Payment of Purchase Price.
5.1 Closing. The closing (the “Closing” or “Close of Escrow”) will occur no
later than the first to occur of (a) thirty (30) days after Final Approval of the CUP pursuant to
Section 6.3 hereof, or (b) seven (7) months after Purchaser’s initial submission of the CUP
application pursuant to Section 6.2 hereof, or (c) eleven (11) months after the Effective Date of
this Agreement (“Closing Date”), or such other date that the Parties agree in writing. In the event
that Closing has not occurred on or prior to the Closing Date, either Party not then in default may,
upon five (5) business days advance written notice to the other Party, terminate this Agreement
and the Escrow. As long as neither Party so elects to terminate this Agreement and the Escrow,
Escrow Holder shall close the Escrow as soon as possible. Upon any such termination of this
Agreement, neither Party shall have any further rights or obligations hereunder; except for the
rights and obligations expressly provided to survive termination of this Agreement.
5.2 Purchaser’s Conditions to Closing. Purchaser's obligation to purchase the
Property is subject to the satisfaction of all of the following conditions or Purchaser's written
waiver thereof (in Purchaser’s sole discretion) on or before the Closing Date:
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(a) Purchaser has not sent a notice of termination to City prior to the
end of the Due Diligence Contingency Period.
(b) City has deposited into the Escrow a fully executed “Grant Deed”
and all other documents to be submitted by City pursuant to this Agreement, all duly executed by
City.
(c) City has performed all obligations to be performed by City pursuant
to this Agreement.
(d) City’s representations and warranties herein are true and correct in
all material respects as of the Closing Date.
(e) The Title Company is irrevocably committed to issue a CLTA or
ALTA standard coverage title insurance policy to Purchaser, together with such endorsements as
are requested by Purchaser, effective as of the Closing Date, insuring title to Purchaser in the full
amount of the Purchase Price, subject only to those exceptions to title which have been approved
by Purchaser.
(f) Final Approval of the CUP shall have occurred.
(g) There shall be no litigation or administrative proceeding pending
with respect to the Property as of the Closing.
(h) The Property shall be free of tenants, occupants, leases and
contracts.
(i) HCD has provided written notice that the conveyance of the
Property is exempt from the requirements of the Surplus Land Act.
5.3 City’s Conditions to Closing. The Close of Escrow and City’s obligation
to sell and convey the Property to Purchaser are subject to the satisfaction of the following
conditions or City’s written waiver (in City’s sole discretion) of such conditions on or before the
Closing Date:
(a) Purchaser has deposited into the Escrow the full amount of the
Purchase Price, and all other costs required by this Agreement to be paid by Purchaser.
(b) Final Approval of the CUP shall have occurred.
(c) Purchaser has performed all obligations to be performed by
Purchaser pursuant to this Agreement before the Closing Date.
(d) Purchaser's representations and warranties set forth herein are true
and correct in all material respects as of the Closing Date.
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(e) There shall be no outstanding notice of violation of the Surplus Land
Act from HCD.
5.4 Conveyance of Title and Possession. City will deliver fee simple title to
Purchaser at the Closing by Grant Deed, subject only to the exceptions to title which have been
approved by Purchaser. At Closing, City shall deliver sole and exclusive possession of the
Property to Purchaser.
5.5 Deliveries at Closing.
(a) Deliveries by City. City shall deposit into the Escrow for delivery
to Purchaser at Closing a fully executed grant deed, substantially in the form attached hereto as
Exhibit B (“Grant Deed”), and all other documents reasonably required to complete the Closing.
(b) Deliveries by Purchaser. No less than one (1) business day prior
to the close of escrow, Purchaser shall deposit into Escrow immediately available funds in the
amount equal to the Purchase Price (less the Deposit), and Purchaser’s share of the Escrow fees
and cost of the Title Policy.
(c) Closing. Upon Closing, Escrow Holder shall: (i) record the Grant
Deed; (ii) disburse to City the Purchase Price; (iii) charge the City for documentary transfer taxes
and governmental conveyance fees; (iv) deliver to each party a certified copy of the executed Grant
Deed; (v) pay any commissions and other expenses payable through Escrow; and (vi) distribute to
itself the payment of Escrow fees and expenses required hereunder.
(d) Closing Costs. City and Purchaser will each pay one-half of all
Escrow fees. City will pay recording fees and documentary transfer taxes. City will pay the
portion of the Title Policy costs equal to the premium of a CLTA owner’s policy in the amount of
the Purchase Price, and Purchaser will pay any additional costs of an ALTA owner’s policy or
endorsements.
(e) No Prorations. As the Property is currently owned by a public
agency, no prorations of property taxes and assessments will be required.
6. Entitlements.
6.1 Application for Entitlements. Purchaser shall, at its sole cost and
expense, diligently pursue and obtain all discretionary governmental approvals necessary for the
reconstruction and use of the Property as an early childhood educational facility (the
“Entitlements”). The issuance of ministerial building permits shall not be considered an
Entitlement.
6.2 Conditional Use Permit (CUP) Application. Purchaser shall cause the
preparation and submission of all site plans and related materials necessary for a conditional use
permit (“CUP”) application to the City for the reconstruction and use of the Property as an early
childhood educational facility (the “CUP Application”), and shall have submitted a Complete
CUP Application within one hundred twenty (120) days of the Effective Date of this Agreement
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(the “CUP Application Deadline”). The City shall review the CUP Application for completeness
and Purchaser shall promptly respond to City requests for additional information. A “Complete
CUP Application” means the CUP Application after the City has determined that the application
is complete pursuant to Government Code Section 65943. Prior to the date of this Agreement,
the City has provided to Purchaser copies of all materials in City’s possession relating to the
prior use of the Premises as an early childhood educational facility, including information
regarding all previously approved parameters for prior CUPs for the Premises, including City
Planning Commission Resolution No. 2384 dated January 12, 1987. Purchaser may elect to, but
shall not be required to, adhere to previously approved CUP parameters in its CUP Application.
6.3 Entitlement Deadline. Purchaser shall cause all required plans,
applications, and submittals necessary to obtain the Entitlements (including the CUP) to be
timely prepared and submitted to the City (in its governmental capacity) so that City staff review
has been completed, such application has been submitted for review and action by the Planning
Commission and/or City Council, approval has been received on the Entitlements (including the
CUP), and all applicable appeal periods shall have expired (“Final Approval”), all within six
months after the date of the CUP Submittal (the “Entitlement Deadline”). For purposes of this
Agreement, “Final Approval” shall mean (i) confirmation by City that Purchaser’s proposed use
of the Property conforms to an existing conditional use permit applicable to the Property, (ii)
approval of an amendment or modification to an existing conditional use permit, or (iii) approval
of a new conditional use permit for the Property, together with expiration of all applicable
administrative appeal periods. Purchaser and City shall each use good faith efforts to diligently
process the Entitlements and CUP Application so that a final decision of the City may be
obtained on or before the Entitlement Deadline. As part of such good faith efforts Purchaser
shall submit additional materials or information to City within ten (10) days after receipt of City
requests for such additional materials or information (or if such materials or information cannot
reasonably be provided within ten (10) days, then as soon as reasonably possible, but not later
than thirty (30) days after receipt of such City requests). In no way shall this section bind the
City (in its governmental capacity) to limit or constrain its discretionary authority in taking
action on such application.
6.4 Termination Upon City Disapproval of CUP Application. In the event
that City disapproves the CUP Submittal, or City has not made a Final Approval of the CUP
Application prior to the Entitlement Deadline, subject to extension pursuant to Section 6.5, then
either party shall have the right to terminate this Agreement by written notice to the other party.
Upon termination of this Agreement pursuant to this Section 6.4, Purchaser shall receive a full
refund of One Hundred Fifty Thousand Dollars ($150,000) of the Deposit, plus interest accrued
thereon.
6.5 Extension of Closing Date. Purchaser shall have the right to extend the
Closing Date for up to sixty (60) days, by delivery of written notice to City of its election to
extend the Closing Date, together with Purchaser filing an appeal of the City’s approval or
disapproval of the Complete CUP Application, within thirty (30) days after the date of City’s
approval or disapproval of the CUP Submittal. Upon such extension of the Closing Date, an
additional Thirty-Seven Thousand Five Hundred Dollars ($37,500) of the Deposit shall become
part of the nonrefundable Deposit, but shall remain applicable to the Purchase Price at Closing.
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7.Representations and Warranties of City. City represents and warrants to
Purchaser the following:
7.1 The execution of this Agreement by City and the transactions
contemplated hereby have been duly authorized by all requisite action on the part of City. The
City has received a notice of exemption from HCD that the City’s conveyance of the Property is
exempt from the requirements of the Surplus Land Act.
7.2 To City’s actual knowledge, there are no claims, actions, suits or
proceedings pending or threatened, before or by any judicial, administrative or union body, any
arbiter or any governmental authority, against City affecting all or any part of the Property.
There are no rights, options, or other agreements of any kind to purchase or otherwise acquire or
sell or otherwise dispose of any of the Property. To City’s actual knowledge there is no existing
or proposed or contemplated eminent domain or similar proceeding which would affect the Land
or the improvements thereon.
7.3 There are no leases, licenses, or other occupancy agreements (written or
oral) in effect that grant any person or entity the right to possess or use any portion of the
Property. At the time of Closing, the Property shall be delivered to Purchaser vacant, free of all
personal property and debris, and free of any parties in possession. There are no parties in
possession of the Property or any portion thereof as trespassers, nor are there any claims of
adverse possession or prescriptive easements.
7.4 City has not received written notice from any governmental authority that
the Property is in violation of any Environmental Laws. Except as disclosed in any
environmental report provided to Purchaser, to City’s actual knowledge, no part of the Property
has ever been used by any person or entity to refine, produce, use, store, handle, transfer,
process, transport or dispose of any Hazardous Substances, other than those Hazardous
Substances that are used or consumed in the normal course of constructing, developing,
operating or occupying commercial real property, to the extent that such substances are stored,
used, and disposed of in the manner and in amounts that are consistent with normal practice and
legal standards. The term "Environmental Laws" means all Federal, state and local laws,
statutes, ordinances, codes, rules, regulations and other requirements respecting the environment.
The term "Hazardous Substance(s)" means any substance, material or waste defined as a
pollutant or contaminant, or as a hazardous, toxic or dangerous substance, material or waste,
under any Environmental Law.
7.5 City has received no written notice from any governmental authority of a
violation of any Federal, state or local law, regulation or ordinance affecting any portion of the
Property.
7.6 In the event, at or prior to Closing, City discovers that any of City’s
representations or warranties contained in this Agreement are untrue or will be untrue as of the
Closing Date in any material adverse respect, City shall give written notice thereof to Purchaser
and City’s representations and warranties shall be deemed qualified and amended as set forth in
such notice (subject to Purchaser’s rights to terminate this Agreement set forth below). With
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respect to any change in a representation or warranty that is materially adverse to Purchaser,
within five (5) business days after receipt of such notice or after actual discovery by Purchaser
that any of City’s representations or warranties contained in this Agreement are untrue or will be
untrue as of the Closing Date in any material adverse respect (the Closing Date being hereby
extended for such period, if necessary, to give Purchaser the five business days to respond),
Purchaser, as its sole and exclusive remedy at law or in equity on account of such untrue or to be
untrue representation or warranty, may elect by written notice to City either to (i) terminate this
Agreement and receive a refund of the Deposit, or (ii) accept and approve City’s representations
and warranties as so qualified and amended.
The representations and warranties of City set forth in Section 7 shall survive Closing for
a period of twelve (12) months (the “Survival Date”). No claim for a breach of any
representation or warranty of City shall be actionable or payable unless (a) the valid claims for
all such breaches collectively aggregate more than Fifteen Thousand Dollars ($15,000), in which
event the full amount of such claims shall be actionable, and (b) written notice containing a
description of the specific nature of such breach (each, a “Claim Notice”) shall have been given
by Purchaser to City prior to the Survival Date.
8. As Is Conveyance; Release. Except as expressly set forth in Section 7 of this
Agreement, this sale is made and will be made without representation, covenant, or warranty of
any kind by City. As a material part of the consideration for this Agreement, Purchaser agrees to
accept the Property on an “as is” and “where is” basis, with all faults, and without any
representation or warranty (other than expressly set forth in Section 7 herein), all of which City
hereby disclaims. No warranty or representation is made by City as to fitness for any particular
purpose, merchantability, design, quality, condition, operation or income, condition or state of
repair of the building located on the Property, compliance of the Property with governmental
requirements relating to zoning, subdivision, planning, building, fire, safety, health or
environmental matters and/or covenants, conditions, restrictions or deed restrictions; compliance
with drawings or specifications, absence of defects, absence of hazardous or toxic substances
(including asbestos and lead based paint), hazardous materials, hazardous wastes, absence of
faults, flooding, or compliance with laws and regulations including, without limitation, those
relating to health, safety, and the environment. Purchaser acknowledges that it has entered into
this Agreement with the intention of making and relying upon its own investigation of the
physical, environmental, economic use, compliance, and legal condition of the Property and that
Purchaser is not now relying, and will not later rely, upon any representations and warranties
made by City or anyone acting or claiming to act, by, through or under or on City’s behalf
concerning the Property. The provisions of this Section 8 shall survive indefinitely any closing
or termination of this Agreement.
Purchaser hereby releases and waives all rights, causes of action and claims Purchaser
has or may have in the future against City and its officers, employees, agents and representatives
arising out of or in connection with any hazardous materials, at, on, in, beneath or from the
Property. The provisions of this paragraph shall not apply to the presence of such hazardous
materials at, on, in, beneath or from the Property that is caused in whole or in part by City.
Subject to the limitation set forth in the preceding sentence, Purchaser hereby acknowledges that
the aforementioned release includes hazardous material claims that Purchaser does not know or
suspect to exist as of the date hereof, and with respect to such hazardous materials claims or
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causes of action, Purchaser affirmatively waives and relinquishes any right or benefit, to the full
extent that it may lawfully waive all such rights and benefits pertaining to the subject matter of
this Section 8, Purchaser further waives all such rights and benefits that Purchaser may have
under California law or any similar provision of the statutory or nonstatutory law of any other
applicable jurisdiction to claim that a general release does not extend to claims which Purchaser
does not know or suspect to exist in its favor at the time of executing the release, which if known
by it would have materially affected its agreement with the City.
Purchaser is aware of and familiar with the provisions of Section 1542 of the California
Civil Code which provides:
A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS THAT THE CREDITOR
OR RELEASING PARTY DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR
HER FAVOR AT THE TIME OF EXECUTING THE RELEASE AN THAT, IF
KNOWN BY HIM OR HER, WOULD HAVE MATERIALLY AFFECTED HIS OR
HER SETTLEMENT WITH THE DEBTOR OR RELEASED PARTY.
As such relates to this Section 8, Purchaser hereby waives and relinquishes all rights and benefits
which it may have under Section 1542 of the California Civil Code.
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Purchaser’sInitials
9. Remedies.
(a) City Default. In the event of a breach or default under this
Agreement by City, if such breach or default occurs prior to Close of Escrow, Purchaser reserves
the right to either seek specific performance from City or to do any of the following: (i) to waive
the breach or default and proceed to close as provided herein; (ii) to extend the time for
performance and the Closing until City is able to perform; or (iii) to terminate this Agreement upon
written notice to City, whereupon City shall cause Escrow Holder to return to Purchaser the
Deposit and any and all sums placed into the Escrow by Purchaser, except for the Independent
Consideration which shall be retained by City, and except for the rights and obligations expressly
provided to survive termination of this Agreement, neither Party shall have any further obligations
or liabilities hereunder.
(b) Purchaser Default. IN THE EVENT THAT, AFTER THE
EXPIRATION OF THE DUE DILIGENCE CONTINGENCY PERIOD, CLOSING DOES NOT
OCCUR, EXCEPT IF THE CLOSING DOES NOT OCCUR SOLELY DUE TO A BREACH
OR DEFAULT HEREUNDER BY CITY, OR SOLELY DUE TO THE FAILURE OF ANY OF
THE PURCHASER’S CONDITIONS TO CLOSING OR CITY’S CONDITIONS TO CLOSING
AS SET FORTH IN SECTIONS 5.2 AND 5.3 HEREOF(OTHER THAN FINAL APPROVAL
OF THE CUP),CITY’S SOLE REMEDY SHALL BE TO RETAIN THE NONREFUNDABLE
PORTION OF THE DEPOSIT AND ALL INTEREST ACCRUED THEREON AS
LIQUIDATED DAMAGES. THE PARTIES AGREE THAT IN SUCH INSTANCE, THE
NONREFUNDABLE PORTION OF THE DEPOSIT AND ALL INTEREST ACCRUED
THEREON REPRESENTS A REASONABLE APPROXIMATION OF CITY’S DAMAGES
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AND IS NOT INTENDED AS A FORFEITURE OR PENALTY BUT RATHER AN
ENFORCEABLE LIQUIDATED DAMAGES PROVISION PURSUANT TO CALIFORNIA
CIVIL CODE SECTION 1671, ET SEQ. IN NO EVENT SHALL EITHER PARTY BE
ENTITLED TO LOST PROFITS OR CONSEQUENTIAL DAMAGES AS A RESULT OF THE
OTHER PARTY’S BREACH OF THIS AGREEMENT. THE CITY SHALL NOT BE
ENTITLED TO RETAIN ANY PORTION OF THE DEPOSIT IN THE EVENT OF
PURCHASER’S TERMINATION OF THIS AGREEMENT PURSUANT TO SECTION 6.4
HEREOF.
Purchaser’s Initials City’s Initials
10. Brokers. City represents that it has retained Professional Real Estate Services, Inc.
as its broker in the sale of the Property. Purchaser represents that it has retained CBRE, Inc. as its
broker in connection with the purchase of the Property. Professional Real Estate Services, Inc. and
CBRE, Inc. are known as the “Brokers”. City shall be solely responsible for payment of all
commissions and fees payable to the Brokers, in the amount of four percent (4%) of the Purchase
Price, to be split equally between the two Brokers. Each Party shall indemnify, hold harmless and
defend the other Party from any and all claims, actions and liability and any commission, finder’s
fee, or similar charges from such Party’s engagement of any otherbroker, and its respective
employees, agents, consultants and contractors.
11. Assignment. Absent an express signed written agreement between the Parties to
the contrary, neither City nor Purchaser may assign its rights or delegate its duties under this
Agreement without the express written consent of the other. Notwithstanding the foregoing,
Purchaser shall be permitted to assign or transfer its rights and obligations under this Agreement
at any time prior to or at the Closing, without being required to obtain the prior consent of or any
other approval from City, to any Permitted Transferee with the full power and authority to perform
Purchaser’s obligations hereunder, provided that (a) such Permitted Transferee expressly assumes
the obligations of Purchaser hereunder, and (b) Purchaser shall remain jointly and severally liable
with the Permitted Transferee for the full and proper performance of this Agreement. As used
herein, a "Permitted Transferee" shall mean any entity controlled by, under common control with,
or controlling of Purchaser. No permitted assignment of any of the rights or obligations under this
Agreement shall result in a novation or in any other way release the assignor from its obligations
under this Agreement.
12. Miscellaneous.
12.1 Attorneys’ Fees. If any Party employs counsel to enforce or interpret this
Agreement, including the commencement of any legal proceeding whatsoever (including
insolvency, bankruptcy, arbitration, mediation, declaratory relief or other litigation), the prevailing
Party shall be entitled to recover its reasonable attorneys’ fees not in excess of $450.00 per hour
and court costs (including the service of process, filing fees, court and court reporter costs,
investigative fees, expert witness fees, and the costs of any bonds, whether taxable or not) and
shall include the right to recover such fees and costs incurred in any appeal or efforts to collect or
otherwise enforce any judgment in its favor in addition to any other remedy it may obtain or be
awarded. Any judgment or final order issued in any legal proceeding shall include reimbursement
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for all such attorneys’ fees and costs. In any legal proceeding, the “prevailing Party” shall mean
the Partydetermined by the court to most nearly prevail and not necessarily the Partyin whose
favor a judgment is rendered.
12.2 Survival. All indemnities, covenants, representations and warranties
contained in this Agreement shall survive Close of Escrow.
12.3 Successors. Except as provided to the contrary in this Agreement, this
Agreement shall be binding on and inure to the benefit of the Parties and their successors and
assigns.
12.4 Governing Law. This Agreement shall be construed and interpreted in
accordance with the laws of the State of California.
12.5 Integrated Agreement; Modifications. This Agreement contains all the
agreements of the Parties concerning the subject hereof, and cannot be amended or modified except
by a written instrument executed and delivered by the Parties. There are no representations,
agreements, arrangements or understandings, either oral or written, between or among the Parties
hereto relating to the subject matter of this Agreement that are not fully expressed herein. In
addition there are no representations, agreements, arrangements or understandings, either oral or
written, between or among the Parties upon which any Party is relying upon in entering this
Agreement that are not fully expressed herein.
12.6 Severability. If any term or provision of this Agreement is determined to
be illegal, unenforceable, or invalid in whole or in part for any reason, such illegal, unenforceable,
or invalid provisions or part thereof shall be stricken from this Agreement, any such provision
shall not be affected by the legality, enforceability, or validity of the remainder of this Agreement.
If any provision or part thereof of this Agreement is stricken in accordance with the provisions of
this Section, then the stricken provision shall be replaced, to the extent possible, with a legal,
enforceable and valid provision this is in keeping with the intent of the Parties as expressed herein.
12.7 Notices. Any delivery of this Agreement, notice, modification of this
Agreement, collateral or additional agreement, demand, disclosure, request, consent, approval,
waiver, declaration or other communication that either Party desires or is required to give to the
other Party or any other person shall be in writing. Any such communication may be served
personally, or by nationally recognized overnight delivery service (e.g., Federal Express) which
provides a receipt of delivery, or sent by prepaid, first class mail, return receipt requested to the
Party’s address as set forth below:
To City: City of Tustin
300 Centennial Way
Tustin, California 92780
Attention: City Manager
With Copy to: Deputy City Manager – Real Property
With Copy to: City Attorney
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To Purchaser: CAZ LLC
4800 Daleview Avenue, SPC 14
El Monte, California 91731
Attn: Xiaoqin Guan
With copy to: Madden, Jones, Cole & Johnson
Attn: Ian Chuang
3010 Old Ranch Parkway, Suite 450
Seal Beach, CA 90740
ianchuang@maddenjones.com
If to Escrow Holder: Lawyer’s Title Insurance Company
2751 Park View Court, Suite 241
Oxnard, CA 93036
Attn: Shirley J. Franks, Escrow Officer
Noel Palacio, Title Officer
Any such communication shall be deemed effective upon personal delivery or on
the date of first refusal to accept delivery as reflected on the receipt of delivery or return receipt,
as applicable. Any Partymay change its address by notice to the other Party. Each Party shall
make an ordinary, good faith effort to ensure that it will accept or receive notices that are given in
accordance with this section and that any person to be given notice actually receives such notice.
12.8 Time. Time is of the essence to the performance of each and every
obligation under this Agreement.
12.9 Days of Week. If any date for exercise of any right, giving of any notice,
or performance of any provision of this Agreement falls on a Saturday, Sunday or holiday, the
time for performance will be extended to 5:00 p.m. on the next business day. “Days” means
calendar days unless expressly stated otherwise.
12.10 Reasonable Consent and Approval. Except as otherwise provided in this
Agreement, whenever a Party is required or permitted to give its consent or approval under this
Agreement, such consent or approval shall not be unreasonably withheld or delayed. If a Party is
required or permitted to give its consent or approval in its sole and absolute discretion or if such
consent or approval may be unreasonably withheld, such consent or approval may be unreasonably
withheld but shall not be unreasonably delayed.
12.11 Further Assurances. The Parties shall at their own cost and expense
execute and deliver such further documents and instruments and shall take such other actions as
may be reasonably required or appropriate to carry out the intent and purposes of this Agreement.
12.12 Waivers. Any waiver by any Party shall be in writing and shall not be
construed as a continuing waiver. No waiver will be implied from any delay or failure to take
action on account of any default by any Party. Consent by any Party to any act or omission by
another Party shall not be construed to be consent to any other subsequent act or omission or to
waive the requirement for consent to be obtained in any future or other instance.
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12.13 Signatures/Counterparts. This Agreement may be executed in two or
more counterparts, each of which shall be deemed an original, but all of which together shall
constitute one and the same instrument. Any one of such completely executed counterparts shall
be sufficient proof of this Agreement. The Parties hereby acknowledge and agree that electronic
signatures that comply with the eSign Act (15 U.S.C. Ch. 96) (such as DocuSign signatures), or
signatures transmitted by electronic mail in so-called "PDF" format shall be legal and binding and
shall have the same full force and effect as if an original of this Agreement had been delivered.
The Parties hereto (a) intend to be bound by the signatures on any document sent by electronic
means including by electronic mail, (b) are aware that the other Party will rely on such signatures,
and (c) hereby waive any defenses to the enforcement of the terms of this Agreement based on the
foregoing forms of signature.
12.14 Date and Delivery of Agreement. Notwithstanding anything to the
contrary contained in this Agreement, the Parties intend that this Agreement shall be deemed
effective, and delivered for all purposes under this Agreement, and for the calculation of any
statutory time periods based on the date an agreement between the Parties is effective, executed,
or delivered, as of the Effective Date.
12.15 Approvals. Whenever this Agreement calls for City approval, consent,
extension or waiver, the written approval, consent, or waiver of the City, the City Manager or his
or her designee(s) shall constitute the approval, consent, extension or waiver of the City, without
further authorization required from the City Council. City hereby authorizes the City Manager and
her designee(s) to deliver any such approvals, consents, or extensions or waivers as are required
by this Agreement, or that do not otherwise reduce City’s rights under this Agreement, and to
waive requirements under this Agreement, on behalf of the City.
12.16 Nondiscrimination. Purchasercovenants by and for itself and any
successors in interest that there shall be no discrimination against or segregation of any person or
group of persons on account of race, color, creed, religion, sex, marital status, national origin or
ancestry, physical or mental disability, or sexual orientation, or on the basis of any other category
or status not permitted by law in the sale, lease, transfer, use, occupancy, tenure or enjoyment of
the Property, nor shall Purchaser itself or any person claiming under or through it establish or
permit any such practice or practices of discrimination or segregation with reference to the
selection, location, number, use or occupancy of residents, tenants, or vendees of the Property or
any portion thereof. The foregoing covenants shall run with the land.
12.17 Conflict of Interest. No member, official or employee of City shall have
any personal interest, direct or indirect, in this Agreement nor shall any such member, official or
employee participate in any decision relating to this Agreement which affects his personal
interests or the interests of any limited partnership, partnership or association in which he is
directly or indirectly interested. Purchaser warrants that it has not paid or given, and will not pay
or give, any third party any money or other consideration for obtaining this Agreement.
12.18 Indemnification. Each Party (an “Indemnifying Party”) agrees to defend,
indemnify and hold the other Party harmless from and against all losses, judgments, claims,
liabilities, costs, damages and expenses (including, but not limited to, reasonable attorney fees
and disbursements) arising or resulting from any actual or alleged liability or obligation with
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regard to the ownership or operation of the Property during the Indemnifying Party’s period of
ownership, including, without limitation, (i) claims for personal injury, wrongful death or
property damage, (ii) claims by tenants under any tenant leases, (iii) claims of mechanics or
materialmen, and (iv) claims by contractors under contracts and by others providing goods and
services in connection with the ownership or operation of the Property. The terms of this section
shall survive the Closing.
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IN WITNESS WHEREOF, the Parties have executed this Agreement as of the date first
written above.
CITY:
CITY OF TUSTIN, a California municipal corporation
By: _______________________________
Aldo E. Schindler, City Manager
Date: _______________________________
ATTEST:
By: _______________________________
Erica N. Yasuda, City Clerk
APPROVED AS TO FORM:
By: _______________________________
David E. Kendig, City Attorney
Date: _______________________________
PURCHASER:
CAZ LLC, a California limited liability company
By: _______________________________
Xiaoqin Guan, Manager
Date: _______________________________
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EXHIBIT A
LEGAL DESCRIPTION
That real property in the City of Tustin, County of Orange, State of California, described as
follows:
LOTS 2, 4 AND 6 IN BLOCK 41 OF A SUBDIVISION MADE BY THE TUSTIN LAND AND
IMPROVEMENT COMPANY, IN THE CITY OF TUSTIN, COUNTY OF ORANGE, STATE
OF CALIFORNIA, AS SHOWN ON A MAP RECORDED IN BOOK 13, PAGE 81, OF
MISCELLANEOUS RECORDS OF LOS ANGELES COUNTY, CALIFORNIA.
APN: 401-583-01
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EXHIBIT B
Recording Requested by
and When Recorded, Return to:
EXEMPT FROM RECORDING FEES PER
GOVERNMENT CODE §§6103, 27383, 27387.1
GRANT DEED
For valuable consideration, receipt of which is hereby acknowledged, as of
_________________, 202__, the City of Tustin, a California municipal corporation, hereby
grants to CAZ LLC, a California limited liability company,all that real property located in the
City of Tustin, County of Orange, State of California and more particularly described in
Attachment No. 1 hereto and incorporated in this Grant Deed by this reference.
By: _______________________________
Aldo E. Schindler, City Manager
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Attachment No. 1 to Grant Deed
LEGAL DESCRIPTION
Real property in the City of Tustin, County of Orange, State of California, described as follows:
LOTS 2, 4 AND 6 IN BLOCK 41 OF A SUBDIVISION MADE BY THE TUSTIN LAND AND
IMPROVEMENT COMPANY, IN THE CITY OF TUSTIN, COUNTY OF ORANGE, STATE
OF CALIFORNIA, AS SHOWN ON A MAP RECORDED IN BOOK 13, PAGE 81, OF
MISCELLANEOUS RECORDS OF LOS ANGELES COUNTY, CALIFORNIA.
APN: 401-583-01
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A notary public or other officer completing
this certificate verifies 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_____________________, 20____ before me, _____________________, a Notary Public, in
and for said State and County, 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
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