EXHIBIT 10.1
PURCHASE AND SALE AGREEMENT
AND JOINT ESCROW INSTRUCTIONS
THIS PURCHASE AND SALE AGREEMENT AND JOINT ESCROW INSTRUCTIONS
("Agreement") is dated as of April 13, 2000, by and between CRBC, LLC, a
California limited liability company ("Seller"), and DCH TECHNOLOGY, INC., a
Colorado corporation ("Buyer").
R E C I T A L S
- - - - - - - -
A. Seller is the owner of certain real property located in the City of
Santa Clarita (the "City"), County of Los Angeles (the "County"), State of
California, commonly known as 24832 Avenue Rockefeller, as more particularly
described in Exhibit A attached hereto (the "Land").
B. The Land is currently improved with one (1) industrial building
containing approximately sixteen thousand eight hundred ninety-seven (16,897)
square feet (the "Improvements").
C. Seller desires to sell to Buyer and Buyer desires to buy from Seller
the Land and Improvements upon the terms and subject to the conditions
hereinafter set forth.
A G R E E M E N T
- - - - - - - - -
NOW, THEREFORE, in consideration of the foregoing Recitals (which, by this
reference, are incorporated herein), the mutual covenants, agreements and
conditions set forth herein, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, Buyer and Seller agree
as follows:
1. Agreement to Purchase/Sell. Seller hereby agrees to sell, convey
--------------------------
and assign to Buyer, and Buyer agrees to buy and accept from Seller, all of
Seller's right, title and interest in the Land and all of the Improvements
located thereon (collectively, the "Property") under the terms and conditions
and for the purchase price hereinafter set forth. The Property shall include
easements and rights of way appurtenant to the Land, and all other rights and
privileges pertaining to the Land and/or the Improvements, including without
limitation any and all construction warranties The Property shall not include
any subsurface mineral rights lying 100 feet or more below the surface of the
Land, which rights shall be retained by Seller or its predecessor without any
right to surface entry.
2. Purchase Price.
---------------
(a) The purchase price to be paid by Buyer at the Close of Escrow
(as defined in Section 4) for the Property (the "Purchase Price") is One
Million Three Hundred Fifty-One Thousand Seven Hundred Sixty Dollars
($1,351,760) and shall be paid in the following increments at the following
times:
(i) Buyer shall deposit into Escrow (as defined in Section
4) cash in the amount of Fifty Thousand Dollars ($50,000) within two
(2) business days after the Opening of Escrow (as defined in Section
4);
(ii) On or before May 15, 2000, Buyer shall deposit into
Escrow an additional sum of cash in the amount of Fifty Thousand
Dollars ($50,000), provided that Buyer does not elect to terminate
this Agreement; and
(iii) Buyer shall deposit into Escrow the balance of the
Purchase Price, as well as all sums necessary to pay Buyer's costs,
expenses and prorations in connection with this transaction at least
one (1) business day prior to the Close of Escrow.
(b) So much of the cash sums as have actually been deposited into
Escrow pursuant to Sections 2(a)(i) and 2(a)(ii) shall sometimes be
referred to herein as the "Deposit." The Deposit shall be placed in an
interest-bearing account by Escrow Holder at a financial institution whose
deposits are federally insured upon terms acceptable to Buyer. All interest
which accrues on the Deposit shall be considered a part of the Deposit.
Subject to the provisions of Sections 13 and 14 below, the Deposit shall be
applied as follows: (i) in the event that a Close of Escrow occurs, the
entire amount of the Deposit shall be credited against the Purchase Price
concurrently with the Close of Escrow; (ii) in the event that this
Agreement is terminated pursuant to Section 3(c) below, the Deposit shall
be refunded to Buyer in accordance with the terms of Section 3(c); or (iii)
in the event of either a default by Buyer as provided in Section 15 below
or the approval and/or waiver of all contingencies under the terms of
Section 3 below, the Deposit shall be released to Seller, shall be non-
refundable to Buyer and shall constitute the liquidated damages of Seller
pursuant to Section 15 below. In the event the Deposit is released to
Seller pursuant to the preceding sentence but thereafter Seller defaults
under this Agreement or the Title Company refuses or is unable to issue the
Title Policy, the Deposit shall be returned to Buyer.
3. Contingencies. Buyer's obligation to purchase the Property and
-------------
the remainder of Buyer's obligations under this Agreement shall be subject to
its approval, deemed approval or waiver of the following contingencies within
the time periods indicated below:
(a) Title.
-----
(i) Buyer shall have until May 15, 2000 to review and
approve a preliminary title report on the Property (the "PTR")
prepared by First American Title Insurance Company (the "Title
Company"), together with legible copies of all documents (the
"Exception Documents") relating to the title exceptions referred to in
the PTR. In the event Buyer approves the PTR, all title matters set
forth in the PTR and all of the Title Company's standard printed
exceptions to coverage shall constitute the "Permitted Exceptions." In
the event Buyer disapproves any title exception(s) contained in the
PTR, then this Agreement shall terminate in accordance with Section
3(c) unless Seller agrees in writing that prior to or concurrently
with the Close of Escrow, Seller will remove the disapproved
exception(s) from title. If Seller so agrees in writing, all title
matters set forth in
the PTR except for the disapproved exception(s), and all of the Title
Company's standard printed exceptions to coverage, shall be considered
Permitted Exceptions. Notwithstanding the foregoing, Buyer hereby
disapproves all monetary liens, and Seller hereby agrees to remove
monetary liens prior to the Close of Escrow.
(ii) If the Title Company, prior to the Close of Escrow,
discloses to Buyer a new exception, or materially amends any exception
previously approved by Buyer, then Buyer shall have five (5) business
days from its receipt of such disclosure, together with legible copies
of all documents mentioned in such disclosure, to disapprove the same
by written notice to Seller; provided, however, that Buyer may
disapprove such new or amended exception only if such new or amended
exception materially and adversely affects Buyer's ability to utilize
the Property for Buyer's intended purpose or diminishes the value of
the Property. Buyer's failure to so notify Seller shall be deemed to
mean that such new or amended exceptions are not acceptable to Buyer,
in which event this Agreement shall terminate and Buyer shall be
entitled to a refund of the Deposit.
(b) Documents to be Obtained and Determinations to be Made by
---------------------------------------------------------
Buyer.
- -----
(i) General Contingencies. On or before May 15, 2000, Buyer
---------------------
shall have notified Seller and Escrow Holder of Buyer's approval or
disapproval of the following documents and matters, as applicable.
(A) All permits, governmental authorizations, CC&R's,
special assessment fees, soils reports and grading plans that
relate to the Property;
(B) The bill or bills issued for the most recent year
for which bills have been issued for all real estate taxes with
respect to the Property and a copy of any and all notices
pertaining to real estate taxes or assessments applicable to the
Property (collectively, the "Tax Bills"). Seller shall promptly
deliver to Buyer a copy of any such Tax Bills received by Seller
after the date hereof even if received after the Close of Escrow;
(C) The results of a physical inspection of the
Property, including without limitation, any and all soils,
geologic, hydrology, seismic, environmental, engineering,
endangered species, archeological, architectural or other
inspections, studies or investigations which Buyer deems to be
advisable;
(D) A copy of the existing Phase I Environmental
Assessment Report relating to the Property which Seller will
provide to Buyer, without representation or warranty as to truth,
accuracy or completeness, upon the Opening of Escrow;
(E) All existing subdivision, zoning, land use
entitlements or permit requirements (including without limitation
water permits) applicable to the Property or Buyer's intended use
or development thereof;
(F) Such feasibility studies as Buyer deems advisable;
and
(G) The results of Buyer's review of the construction
contracts, warranties, and plans and specifications pursuant to
which the Improvements have been constructed.
(ii) Documents. Seller will use best efforts to deliver to
---------
Buyer or its counsel a preliminary title report with underlying documents
and Seller's non-proprietary and non-confidential records relating to the
Property, including contracts, plans, studies, reports and other items
specified in Section 3(b)(i), if any, on or before April 18, 2000. Seller
represents that all documents in its possession or control listed in
Section 3(b)(i) will be delivered to Buyer pursuant to the preceding
sentence. Buyer agrees that any information relating to Seller's costs of
construction is proprietary and will be redacted from any documents
(including without limitation, the construction contract) prior to delivery
to Buyer. Buyer acknowledges and agrees that all documents made available
by Seller are for informational purposes only, that Seller makes no
representation or warranty (nor shall any representation or warranty be
deemed made by Seller) with respect to the truth, accuracy or completeness
of any matters set forth in such documents, except that Seller represents
that to Seller's actual knowledge, all copies of documents delivered to
Buyer are true and correct copies of the originals. Buyer further
acknowledges and agrees that it is not relying on any information contained
in such documents and, instead, is relying on its own investigation of the
Property and related matters as more particularly set forth below in
Section 8(b).
(iii) Financing. Buyer shall have until May 15, 2000 to
---------
satisfy itself as to the availability of financing for the purchase of the
Property on terms and conditions acceptable to Buyer. At the request of
Buyer, this contingency may be extended until May 31, 2000, if (A) Buyer
has in good faith diligently attempted to arrange its loan for the
acquisition of the Property, and (B) Buyer's lender has not yet finished
its underwriting to the extent such underwriting relates to the Property
and not to Buyer.
(iv) Natural Hazard Disclosure. Within ten (10) calendar
-------------------------
days after Opening of Escrow, Seller shall provide Buyer with a Natural
Hazard Disclosure Statement with respect to the Property (the "Natural
Hazard Report") prepared by a commercial entity specializing in such
services, in order to comply with the natural hazard disclosure
requirements of the State of California. Seller has made no independent
inquiry with regard to the matters set forth in the Natural Hazard Report,
and is exclusively relying on the expertise of
the party preparing the Natural Hazard Report. Seller shall have no
liability to Buyer with respect to any inaccuracy contained in the
Natural Hazard Report.
(c) Conditions Precedent. The approval or waiver of all
--------------------
contingencies set forth herein within the time period specified in this
Section 3 is a condition precedent to the Close of Escrow. Buyer may
approve or disapprove any or all of the documents, materials, items and
matters identified in this Section 3 in its reasonable discretion. If Buyer
timely disapproves or is deemed to disapprove any contingency as set forth
in this Section 3, this Agreement and Escrow shall be terminated, unless
within ten (10) business days after Seller receives from Buyer written
notice of such disapproval Seller either satisfies such contingency or
agrees to satisfy such contingency prior to the Close of Escrow. In the
event this Agreement and Escrow are terminated pursuant to this Section
3(c), the Deposit shall be returned to Buyer minus Buyer's share of Escrow
cancellation charges as provided in Section 5(e) below, and all documents
deposited into Escrow by either party shall be returned to the party which
deposited the same.
(d) Deemed Disapproval. The failure by Buyer to approve in
------------------
writing any of the documents, materials, items or matters referred to in
this Section 3 within the time period provided herein, shall be deemed
disapproval by Buyer of such documents, materials, items or matters as to
which such notice of approval has not been given. Buyer may waive any of
the foregoing contingencies by the delivery of written notice thereof to
Seller and Escrow Holder.
(e) Release of Deposit. Upon approval and/or the waiver of all
------------------
of the foregoing contingencies by Buyer, and following Seller's deposit of
the Grant Deed into Escrow, the Deposit shall be released to Seller by
Escrow Holder without any further instruction, and shall be nonrefundable
to Buyer except in the event of a default by Seller or the Title Company's
failure to issue the Title Policy.
(f) Seller's Right to Studies. If Escrow fails to close for any
-------------------------
reason other than the breach of this Agreement by Seller, Buyer shall
immediately deliver to Seller and Seller shall be entitled to retain, at no
cost or expense to Seller, all layouts, surveys, environmental audits and
other reports, investigations, test results and information obtained by
Buyer with respect to the Property (or any part thereof), and, to the
extent of Buyer's rights therein, Seller shall be authorized to use and
distribute any and all such documentation and information as it shall elect
in its sole and absolute discretion, but without representation or warranty
by Buyer whatsoever.
4. Escrow.
(a) Escrow Holder. An escrow for the purchase and sale of the
-------------
Property (the "Escrow") shall be established at First American Title
Insurance Company, 2 First American Way, Santa Ana, California 92707 (the
"Escrow Holder").
(b) Opening of Escrow. The Escrow shall be deemed open (the
-----------------
"Opening of Escrow") upon the date that both Buyer and Seller have fully
executed this document and delivered it to the Escrow Holder. Upon the
Opening of Escrow, Escrow
Holder shall give written notice to Buyer and Seller of the date on which
the Opening of Escrow occurs or is deemed to have occurred.
(c) Escrow Instructions. This Agreement shall constitute the
-------------------
escrow instructions of Buyer and Seller to the Escrow Holder, and by
accepting this Agreement and opening the Escrow, the Escrow Holder agrees
to be bound by the terms and provisions of this Agreement.
(d) Seller Deposits into Escrow. Seller shall deliver or cause
---------------------------
to be delivered to Escrow Holder in a timely manner to permit the closing
of the transaction contemplated hereby by the Close of Escrow, the
following:
(i) A Grant Deed conveying the Property to Buyer subject
only to the Permitted Exceptions (the "Grant Deed");
(ii) A California Form 590-RE and a Non-Foreign Affidavit
in the form of Exhibit B attached hereto (collectively, the "Non-
Foreign Affidavit");
(iii) An Assignment of Construction Warranties in the form
of Exhibit C attached hereto (the "Assignment"); and
(iv) Any other documents reasonably required by the Title
Company to consummate this transaction.
(e) Buyer Deposits into Escrow. Buyer shall deliver or cause to
--------------------------
be delivered to Escrow Holder in a timely manner to permit the closing of
the transaction contemplated hereby by the Close of Escrow, the following:
(i) The entire Purchase Price together with such other
funds required for costs to be paid by Buyer pursuant to the terms of
this Agreement;
(ii) A preliminary change of ownership statement; and
(iii) Any other documents reasonably required by the Title
Company for the issuance of the Title Policy and the Closing of
Escrow.
(f) Close of Escrow. Escrow shall close (the "Close of Escrow")
---------------
on or before the day which is seven (7) days following the expiration of
the contingency period described in Section 3(b)(iii); provided, however,
that the Close of Escrow shall be extended for a period of up to an
additional seven (7) calendar days, if (i) Buyer has in good faith
diligently attempted to arrange its loan for the acquisition of the
Property, and (ii) Buyer's lender is not yet prepared to fund such loan.
Buyer shall be obligated to close the purchase of the Property as soon as
such lender is prepared to fund, but in any event on or before the
expiration of such seven (7) day extension period. Escrow shall be deemed
to have closed at the time the Grant Deed is filed for record in the
Official Records of the County.
(g) Authorization to Close Escrow. Provided that Escrow Holder shall
-----------------------------
not have received written notice from Buyer or Seller of the failure of any
conditions precedent or of the termination of the Escrow, Buyer and Seller have
deposited into the Escrow the items required by this Agreement and the Title
Company can and will issue the Title Policy (as defined in Section 7)
concurrently with the Close of Escrow, Escrow Holder shall:
(i) Deliver to Buyer the Grant Deed by causing it to be
recorded in the Official Records of the County and requesting that it be
mailed to Buyer after it has been recorded;
(ii) Deliver to Seller or to Seller's order the cash portion of
the Purchase Price, less (A) all amounts to be paid by Seller hereunder,
(B) Seller's share of liabilities and/or expenses to be prorated by Escrow
Holder to Seller's account under Section 6, and (C) all amounts paid by
Escrow Holder or the Title Company in satisfaction of liens and
encumbrances on the Property in order to put title to the Property into the
state required by this Agreement;
(iii) Deliver to Buyer the Non-Foreign Affidavit; and
(iv) Cause the Title Policy to be issued to Buyer by Title
Company.
(h) U.S. Treasury Regulations. The purchase and sale of the Property
-------------------------
is the sale of "reportable real estate" within the meaning of U.S. Treasury
Regulations Section 1.6045-4 (the "Regulation"). Escrow Holder is the "real
estate reporting person" within the meaning of the Regulation and shall make all
reports to the federal government as required by the Regulation.
5. Closing Costs.
-------------
(a) Seller shall pay any documentary transfer tax on the Grant Deed
and fifty percent (50%) of all escrow fees of the Escrow Holder.
(b) Buyer shall pay the fees for recording the Grant Deed and fifty
percent (50%) of all escrow fees of the Escrow Holder.
(c) The cost of the Title Policy shall be borne as described in
Section 7(d) below.
(d) Any other costs of the Escrow or of closing pertaining to this
transaction not otherwise expressly allocated between Buyer and Seller under
this Agreement shall be apportioned in the manner customary in the County.
(e) Notwithstanding the foregoing provisions of this Section 5, if
the Escrow fails to close for any reason (other than the breach of this
Agreement by one or both of the parties), the costs incurred through the Escrow,
including the cost of the PTR, shall be borne equally by Buyer and Seller.
Otherwise, the party who breached this
Agreement first shall bear all the costs incurred through the Escrow,
including the cost of the PTR.
6. Prorations and Adjustments.
--------------------------
(a) All operating expenses of the Property shall be prorated as of
the Close of Escrow. As used herein, the term "operating expenses of the
Property" shall include, without limitation:
(i) The charges for utilities servicing the Property;
(ii) Association assessments and charges under any operating
contracts relating to the Property; and
(iii) Non-delinquent real property taxes, assessment district
charges and similar items.
(b) All such prorations shall be subject to adjustment outside of
Escrow within sixty (60) days after the Close of Escrow to the extent new
information becomes available to Buyer or Seller.
(c) Unless otherwise provided in this Section 6, all prorations
shall be made on the basis of actual days in a month and a 365-day year, and the
obligation of Buyer and Seller under this Section 6 shall survive the Close of
Escrow. Escrow Holder shall calculate all prorations based upon an operation,
income and expense schedule provided by Seller and approved by Buyer. For
purposes of calculating prorations, Buyer shall be deemed to be in possession of
title to the Property, and therefore responsible for the expenses thereof, for
the entire day upon which the Close of Escrow occurs.
7. Title.
-----
(a) Possession. Buyer shall be placed in possession of the Property
----------
as of the Close of Escrow.
(b) Deed. Title to the Property shall be conveyed to Buyer by the
----
Grant Deed.
(c) Policy. Title to be conveyed to Buyer shall be insured by a
------
CLTA Standard Coverage Policy of Title Insurance (the "Title Policy") with
liability in the amount of the Purchase Price, dated the date of the Close of
Escrow, issued by the Title Company, insuring that Buyer is vested with fee
simple title in the Property, subject only to the Permitted Exceptions.
(d) Cost of Policy. Seller shall pay one hundred percent (100%) of
--------------
the cost of the Title Policy and the cost of any and all title endorsements
which are used for title curative purposes under Section 3. Buyer may obtain, in
lieu of the Title Policy, an ALTA Extended Coverage policy of title insurance
(the "ALTA Policy") issued by the Title Company with liability in the amount of
the Purchase Price; provided, however,
-------- -------
that in such event Buyer shall be solely responsible for any difference in
premium or charge between the Title Policy and the ALTA Policy and for all
survey and other costs associated with such ALTA Policy, and, provided
--------
further, Buyer's election to obtain an ALTA Policy shall in no way
-------
extend the title review contingency period set forth in Section 3(a).
8. Representations, Warranties and Covenants of Buyer. Buyer hereby
--------------------------------------------------
represents, warrants and covenants to Seller that the following matters are true
and correct as of the execution of this Agreement and also will be true and
correct as of the Close of Escrow:
(a) This Agreement and all the documents to be executed and delivered
by Buyer to Seller pursuant to the terms of this Agreement, (i) have been
or will be duly authorized, executed and delivered by Buyer, (ii) are or
will be legal, valid and binding obligations of Buyer as of the date of
their respective executions, (iii) are or will be enforceable in accordance
with their respective terms (except to the extent that such enforcement may
be limited by applicable bankruptcy, insolvency, moratorium and other
principles relating to or limiting the rights of contracting parties
generally), and (iv) do not, and will not, at the Close of Escrow, violate
any provisions of any agreement to which any of the individuals or entities
comprising Buyer is a party.
(b) Buyer hereby agrees and acknowledges that it is buying the
Property on an "AS-IS" basis; that it has made or will have made its own
investigations and inspections of the Property, including, without
limitation, the physical aspects of the Property; that in connection with
its investigations and inspections of the Property it contracted or had the
opportunity to contract with certain advisors and consultants, including,
but not limited to, environmental consultants, engineers, architects and
geologists, to conduct such environmental, architectural, geological and
other inspections of the Property as Buyer deemed to be necessary; that it
has approved the reports of such entities; that it is relying solely on
such entities' reports and its own investigations as to the Property, its
condition and other characteristics; that, except for the representations
and warranties set forth in Section 9, it is not relying on any
representations or warranties of Seller regarding the Property or any
portion thereof or any matter related thereto; and that, except for the
representations and warranties set forth in Section 9, Buyer is not making
the purchase in reliance upon any statements or representations, express or
implied, made by Seller or its agents or brokers, as to the condition of or
characteristics of the Property, its fitness for use for any particular
purpose, or the Property's compliance with any zoning or other rules,
regulations, laws or statutes applicable to the Property, or the uses
permitted on or the development requirements or any other matters relating
to the Property. Seller has no liability nor responsibility to Buyer in
connection with the matters set forth in this Section 8(b), including,
without limitation, any liability for Seller's negligence or under any
laws, rules, regulations or ordinances regulating the environment,
hazardous materials, or human health and safety, or any latent or patent
defects. Nothing set forth in this Section 8(b) or elsewhere in this
Agreement shall be construed as a waiver by Buyer of any rights or remedies
against any person or entity other than Seller and its principals.
9. Representations, Warranties and Covenants of Seller. Seller hereby
---------------------------------------------------
represents, warrants and covenants to Buyer that the following matters are true
and correct as of the execution of this Agreement and will also be true and
correct as of the Close of Escrow:
(a) Seller is a limited liability company duly formed, validly
existing and in good standing under the laws of the State of California.
(b) This Agreement and all the documents and items to be executed
and delivered by Seller to Buyer pursuant to the terms of this Agreement,
(i) have been or will be duly authorized, executed and delivered by Seller,
(ii) are or will be legal, valid and binding obligations of Seller as of
the date of their respective executions, (iii) are or will be enforceable
in accordance with their respective terms (except to the extent that such
enforcement may be limited by applicable bankruptcy, insolvency, moratorium
and other principles relating to or limiting the rights of contracting
parties generally), and (iv) do not and will not, at the Close of Escrow,
violate any provisions of any agreement to which Seller is a party.
(c) To Seller's actual knowledge, and except as otherwise disclosed
to Buyer in writing, Seller has not received from any third party
(including any federal, state or municipal governmental agency or
authority) written request for information, written notices of claim,
demand letters, or other written notification that it is or may be
potentially responsible with respect to any investigation or clean-up of
hazardous substances (including asbestos) released at the Property.
(d) To Seller's actual knowledge, and except as otherwise disclosed
to Buyer in writing, no condemnation, eminent domain, zoning or other land-
use regulation proceeding or any other actions, suits or proceedings are
pending or threatened against the Property, nor has Seller any knowledge of
any assessments affecting the Property other than as set forth in the PTR.
(e) To Seller's actual knowledge, and except as otherwise disclosed
to Buyer in writing, there are no violations of any covenants, conditions
or restrictions applicable to the Property, and Seller has received no
written notice or complaint with respect to any such violation or alleged
violation.
(f) To Seller's actual knowledge, and except as disclosed to Buyer
in writing, there are no leases or tenancy agreements affecting the
Property or any portion thereof.
10. Intentionally Deleted.
---------------------
11. Limitation on Enforcement of Rights. Buyer, by completing its
-----------------------------------
acquisition of the Property, shal be deemed to have waived any breaches or
defaults of Seller of which Buyer had actual knowledge prior to the Close of
Escrow.
12. Right to Enter Property. Commencing on the Opening of Escrow, and
-----------------------
continuing thereafter until this Agreement has been terminated, Buyer and its
agents shall have the right, at Buyer's sole cost and expense, and upon two (2)
days' prior written notice to Seller
(which notice shall contain a certificate of the liability insurance policy
described below), to enter onto the Property at reasonable times and in a
reasonable manner for the purpose of making such non-invasive and non-
destructive tests and inspections as Buyer deems necessary in connection with
this Agreement. Buyer shall maintain liability insurance coverage applicable to
such activities with coverage in an amount of One Million Dollars ($1,000,000)
per occurrence and issued by an insurer reasonably acceptable to Seller. Such
policy shall name Seller as an additional insured and shall provide that there
shall not be any cancellation or reduction in coverage without thirty (30) days'
prior written notice to Seller at the address set forth in Section 19. After
making such tests and inspections, Buyer shall restore the Property to its
condition prior to such tests and inspections. Buyer hereby agrees to indemnify,
defend, protect and hold Seller harmless from and against any loss, liability,
claim, damage, cost or expense (including attorneys' fees) in connection with
such tests and inspections.
13. Destruction of Improvements. If prior to the Close of Escrow the
---------------------------
Improvements are damaged or destroyed, whether by fire or other casualty, then
Seller shall promptly notify Buyer of such damage or destruction and the cost to
repair the same, as reasonably estimated by Seller. In the event such estimated
cost is in excess of Fifty Thousand Dollars ($50,000), Buyer may terminate the
Escrow and this Agreement by giving Seller written notice of its intent to do so
within five (5) business days after the date Buyer receives actual notice of
said damage or destruction and the estimated cost to repair. On such
termination, neither party shall have any further rights or obligations
hereunder, and all funds deposited by Buyer into Escrow or released to Seller
(less Buyer's share of Escrow fees theretofore incurred and one-half of the cost
of the PTR), shall be returned to Buyer. In the event such estimated cost of
repair is Fifty Thousand Dollars ($50,000) or less, or in the event Buyer elects
not to terminate this Agreement, then the Escrow and this Agreement shall remain
in full force and effect and Seller shall assign to Buyer, as a condition
precedent to the Close of Escrow, all of Seller's rights, title and interest in
and to any insurance proceeds or claims therefor with respect to such damage or
destruction. Additionally, in such latter case, Seller shall pay to Buyer, by
way of a credit against the Purchase Price, an amount equal to any deductible
amount applicable to such damage or destruction under any casualty insurance
coverage maintained by Seller with respect to the Property.
14. Loss by Condemnation. In the event that prior to the Close of Escrow,
--------------------
the Property, or any substantial part thereof, is subject to a taking by a
public authority, then Buyer shall have the right, exercisable by giving notice
to Seller within fifteen (15) days after receiving written notice of such
taking, either (a) to terminate this Agreement and obtain a refund of the
Deposit, in which case neither party shall have any further rights or
obligations hereunder, except that Buyer and Seller shall each be responsible
for one-half of any title or Escrow cancellation fee, or (b) to accept the
Property in its then condition and proceed to close this transaction, and to
receive an assignment of all of Seller's rights to any condemnation awards
payable by reason of such taking. If Buyer elects to proceed under clause (b)
above, Seller shall not compromise, settle or adjust any claims to such awards
without Buyer's prior written consent, which consent shall not be unreasonably
withheld. Seller agrees to give Buyer prompt notice of any taking of the
Property promptly after Seller receives notice of the same.
15. Default of Buyer. IN THE EVENT BUYER DEFAULTS IN ITS OBLIGATION TO
----------------
CLOSE THE PURCHASE OF THE PROPERTY IN ACCORDANCE WITH THIS AGREEMENT, THE
DEPOSIT SHALL BE RETAINED BY SELLER AS LIQUIDATED DAMAGES WHICH SHALL BE
SELLER'S SOLE REMEDY HEREUNDER. THE PARTIES HERETO EXPRESSLY AGREE AND
ACKNOWLEDGE THAT SELLER'S ACTUAL DAMAGES IN THE EVENT OF A DEFAULT BY BUYER
WOULD BE EXTREMELY DIFFICULT OR IMPRACTICABLE TO ASCERTAIN AND THAT THE AMOUNT
OF THE DEPOSIT REPRESENTS THE PARTIES' REASONABLE ESTIMATE OF SUCH DAMAGES. THIS
SECTION 15 APPLIES ONLY TO A DEFAULT OF BUYER IN ITS OBLIGATION TO CLOSE THE
PURCHASE OF THE PROPERTY AND IN NO WAY LIMITS BUYER'S POTENTIAL LIABILITY FOR
ATTORNEYS' FEES PURSUANT TO SECTION 20(B) OR FOR INDEMNITY OBLIGATIONS SET FORTH
IN THIS AGREEMENT.
SELLER'S INITIALS: ______ BUYER'S INITIALS: ______
16. Assignment of Contracts. Upon the Close of Escrow, Seller shall be
-----------------------
deemed to have assigned without warranty to Buyer all of Seller's right, title
and interest in and to all assignable contracts, warranties, guaranties, plans,
specifications and architect's, engineer's and other consultant's reports
relating to the Property or the construction of the Improvements. Seller shall
deliver all such documents to Buyer concurrently with the Close of Escrow. Buyer
is not required to assume any obligations under any such documents.
17. Buyer's Remedies. Buyer and Seller agree that if the sale
----------------
contemplated by this Agreement is not completed as provided herein solely by
reason of a material default of Seller or failure of the Title Company to issue
the Title Policy, Buyer shall be entitled to terminate this Agreement and to
obtain the return of the Deposit with interest at the rate of ten percent (10%)
per annum from the date the Deposit is released from Escrow to Seller. Buyer
does hereby specifically waive any right to pursue any other remedy at law or
equity for such default of Seller.
18. Broker's Commission. In connection with the transaction contemplated
-------------------
by this Agreement, at the Close of Escrow, Seller shall pay a brokers'
commission pursuant to a separate agreement which commission shall be split
between CB Richard Ellis, Inc. and Told Partners. With the exception of such
commission, Buyer and Seller each represents to the other that it has not
entered into any agreement or incurred any obligation which might result in the
obligation to pay a sales or brokerage commission or finder's fee with respect
to this transaction. Buyer and Seller each agrees to indemnify, defend, protect
and hold the other harmless from and against any and all losses, claims,
damages, costs or expenses (including attorneys' fees) which the other may incur
as a result of any claim made by any person to a right to a sales or brokerage
commission or finder's fee in connection with this transaction to the extent
such claim is based, or purportedly based, on the acts or omissions of Seller or
Buyer, as the case may be. The obligations of Buyer and Seller under this
Section 18 shall survive the Close of Escrow.
19. Notices. All notices required or permitted by this Agreement must be
-------
in writing and shall be deemed to have been duly given when personally
delivered, twenty-four
(24) hours after deposited with a reliable overnight carrier guaranteeing next
day delivery, postage prepaid, addressed as set forth below, or seventy-two (72)
hours after mailed by United States registered mail, return receipt requested,
postage prepaid, as follows:
To Seller: c/o The Clifford Realty Company
1451 Quail Street, Suite 210
Newport Beach, California 92660
Attention: Mr. John E. Quinton
With a copy to: O'Melveny & Myers LLP
610 Newport Center Drive, 17th Floor
Newport Beach, California 92660-6429
Attention: Scott J. Daruty, Esq.
To Buyer: c/o Told Partners
27833 Avenue Hopkins, Second Floor, 1B
Valencia, California 91355
Attention: Mr. Steve Robertson
With a copy to: Silicon Valley Law Group
152 North Third Street, Suite 900
San Jose, California 95112
Attention: Lucy Lofrumento, Esq.
To Escrow Holder: First American Title Insurance Company
2 First American Way
Santa Ana, California 92707
Attention: Katherine Shannon
Escrow No.: 2076115
Either party may change its address for purposes of receiving notice hereunder
by giving notice to the other party pursuant to the provisions hereof. Refusal
to accept delivery of any notice shall be deemed to be delivery thereof.
20. Miscellaneous Provisions.
------------------------
(a) Incorporation of Prior Agreements. This Agreement contains
---------------------------------
the entire understanding of Buyer and Seller with respect to the subject
matter hereof, and supersedes all prior or contemporaneous written or oral
agreements and understandings between the parties hereto pertaining to any
such matter. No provision of this Agreement may be amended, modified or
supplemented or added to except by an agreement in writing, expressly
stating that such agreement is an amendment of this Agreement, signed by
the parties to this Agreement or their respective successors in interest.
(b) Attorneys' Fees. If either party commences an action
---------------
against the other to interpret or enforce any of the terms of this
Agreement or because of the breach by the other party of any of the terms
hereof, the losing party shall pay to the prevailing party reasonable
attorneys' fees, costs and expenses incurred in connection with the
prosecution or defense of such action, whether or not the action is
prosecuted to a final judgment. For the purpose of this Agreement, the
terms "attorneys' fees" or "attorneys' fees and costs" shall mean the fees
and expenses of counsel to the parties hereto, which
may include printing, photostating, duplicating and other expenses, air freight
charges, and fees billed for law clerks, paralegals, librarians and others not
admitted to the bar but performing services under the supervision of an
attorney. The terms "attorneys' fees" or "attorneys' fees and costs" shall also
include, without limitation, all such fees and expenses incurred with respect to
appeals, arbitrations and bankruptcy proceedings, and whether or not any action
or proceeding is brought with respect to the matter for which said fees and
expenses were incurred. The term "attorney" shall have the same meaning as the
term "counsel."
(c) Time is of the Essence. Time is of the essence of this Agreement.
----------------------
(d) Successors and Assigns. This Agreement shall be binding upon and
----------------------
inure to the benefit of each of the parties hereto and to their respective
transferees, successors and assigns. Notwithstanding the foregoing, Buyer shall
have no right to assign or transfer any of Buyer's rights or responsibilities
hereunder to any person or entity without Seller's prior written consent, which
may be given or withheld in Seller's sole and absolute discretion; provided,
however that Seller hereby consents to an assignment of this Agreement by Buyer
to any entity controlling, controlled by or under common control with Buyer.
(e) California Law; Choice of Forum. This Agreement shall be construed in
-------------------------------
accordance with and governed by the internal laws of the State of California,
without giving effect to any "conflict of law" rules of such state. Buyer and
Seller each acknowledge and agree that the Superior Court of the State of
California in and for the County of Orange and the associated appellate courts
shall have exclusive jurisdiction to hear and decide any dispute, controversy or
litigation regarding the enforceability or validity of this Agreement or any
portion thereof.
(f) Counterparts. This Agreement may be executed in any number of
------------
counterparts, each of which shall be deemed an original, but all of which, when
taken together, shall constitute one and the same instrument.
(g) Interpretation. Wherever possible, each provision of this Agreement
--------------
shall be interpreted in such a manner as to be valid under applicable law, but,
if any provision of this Agreement shall be invalid or prohibited thereunder,
such invalidity or prohibition shall be construed as if such invalid or
prohibited provision had not been inserted herein and shall not affect the
remainder of such provision or the remaining provisions of this Agreement.
Section headings of this Agreement are solely for convenience of reference and
shall not govern the interpretation of any of the provisions of this Agreement.
Only those obligations and liabilities expressly stated herein to survive the
Close of Escrow shall survive the Close of Escrow.
(h) Construction. The language in all parts of this Agreement shall be
------------
in all cases construed simply according to its fair meaning and not strictly
against the party who drafted such language.
(i) Exhibits. All Exhibits attached hereto are incorporated herein by
--------
reference and made a part hereof for all purposes.
(j) No Recordation. This Agreement shall not be recorded or
--------------
filed in the public records of any jurisdiction by either party. Any
attempt to do so shall be a breach of this Agreement.
(k) Business Days. Unless "business day" is specified, the term
-------------
"day" means a calendar day. Nevertheless, whenever action must be
taken under this Agreement during a certain period of time or by a
certain date that ends or occurs on a day which is not a business day,
the time for performance shall be extended to the next business day.
The term "business day" means any day other than a Saturday, Sunday or
Federal or State of California holiday.
21. Confidentiality.
---------------
(a) In connection with the transaction contemplated herein,
Seller will be delivering or otherwise making available to Buyer
information, documents and other materials related to the Property,
which may include, without limitation, those documents and materials
referred to in Section 3(b) herein (collectively, the "Information").
The existence of this Agreement and the terms contained herein are
considered a part of the Information for purposes of this
confidentiality provision. Without Seller's prior written consent,
Buyer agrees not to disclose prior to the Close of Escrow any
Information except (i) to Buyer's auditors, counsel or professional
advisors to whom it is necessary to show the Information, each of
which shall be informed by Buyer of the confidential nature of the
Information; and (ii) in any statement or testimony pursuant to a
subpoena or order by any court, governmental body or other agency
asserting jurisdiction over Buyer, or to comply with Buyer's
disclosure obligations as a public company, or as may otherwise be
required by law (provided that Buyer shall give Seller notice of the
disclosure permitted by this clause (ii) unless such notice is
prohibited by the subpoena, order or law).
(b) In the event this Agreement is terminated for any reason
prior to the Close of Escrow, Buyer will, upon demand, return to
Seller all documents or other written material received from Seller
and all copies thereof made by Buyer which contain the Information
which have not been properly disposed of by Buyer.
22. Document Not an Offer. The submission of this document to Buyer
---------------------
by Seller shall not constitute an offer by Seller to sell the Property on the
terms set forth herein or on any other terms. Buyer expressly acknowledges and
agrees that Seller shall not be bound by any of the terms of this Agreement
until Seller has executed this Agreement and delivered it to Escrow Holder.
[SIGNATURES ON NEXT PAGE]
IN WITNESS WHEREOF, Buyer and Seller have executed this Agreement as of the
day and year first above written.
"SELLER"
CRBC, LLC,
a California limited liability company
By:___________________________________
John E. Quinton, President
"BUYER"
DCH TECHNOLOGY, INC.,
a Colorado corporation
By:___________________________________
Name:_________________________________
Title:________________________________
EXHIBIT A
LEGAL DESCRIPTION
All that real property situated in the City of Santa Clarita, County of Los
Angeles, State of California and more particularly described as follows:
[TO BE ATTACHED BY ESCROW HOLDER]
EXHIBIT B
SELLER'S NON-FOREIGN AFFIDAVIT
To inform DCH TECHNOLOGY, INC., a Colorado corporation (the "Transferee"), that
withholding of tax under Section 1445 of the Internal Revenue Code of 1986, as
amended (the "Code"), will not be required upon the transfer of certain real
property to the Transferee by CRBC, LLC (the "Transferor"), the undersigned
hereby certifies the following on behalf of Transferor:
1. Transferor is not a foreign corporation, foreign partnership,
foreign trust or foreign estate (as those terms are defined in
the Code and Income Tax Regulations promulgated thereunder);
2. Transferor's U.S. employer identification number is ____________;
and
3. Transferor's office address is c/o The Clifford Companies, 1451
Quail Street, Suite 210, Newport Beach, California 92660.
Transferor understands that this Certification may be disclosed to the Internal
Revenue Service by Transferee and that any false statement contained herein
could be punished by fine, imprisonment, or both.
Under penalty of perjury, I declare that I have examined this Certification and
that, to the best of my knowledge and belief, it is true, correct and complete,
and I further declare that I have authority to sign this document on behalf of
the Transferor.
Dated: ____________, 2000
CRBC, LLC,
a California limited liability company
By:
------------------------------------------
John E. Quinton, President
EXHIBIT C
ASSIGNMENT
ASSIGNMENT OF WARRANTIES,
GUARANTIES, PERMITS AND OTHER INTANGIBLE PROPERTY
THIS ASSIGNMENT OF WARRANTIES, GUARANTIES, PERMITS AND OTHER INTANGIBLE
PROPERTY (this "Assignment") is made as of _______________, 2000, by CRBC, LLC,
a California limited liability company ("Assignor"), to DCH TECHNOLOGY, INC., a
Colorado corporation ("Assignee").
WITNESSETH:
WHEREAS, Assignor is contemporaneously herewith selling pursuant to that
certain Purchase and Sale Agreement and Joint Escrow Instructions dated as of
April 13, 2000, by and between Assignor and Assignee (the "Purchase Agreement")
that certain real property located in the City of Santa Clarita, County of Los
Angeles, State of California, which is more particularly described on Schedule 1
attached hereto and incorporated herein by this reference and improvements
thereon (the "Property"). Terms used in this Agreement and not otherwise herein
defined shall be given the meanings defined in the Purchase Agreement.
WHEREAS, Assignor desires to assign its interest in and to the following to
Assignee as of the date on which title to the Property is vested in Assignee
(the "Transfer Date"):
(a) All "Warranties and Guaranties" (hereinafter defined);
(b) All "Intangible Property" (hereinafter defined); and
(c) All "Permits" (hereinafter defined).
NOW, THEREFORE, FOR GOOD AND VALUABLE CONSIDERATION, the receipt and
sufficiency of which is hereby acknowledged, the parties hereto agree as
follows:
1. As of the Transfer Date, Assignor hereby assigns and transfers unto
Assignee, on an "as-is, where-is" basis and without representation or warranty
of any kind, all of its right, title, claim and interest in, to and under the
(a) Warranties and Guarantees; (b) Intangible Property; and (c) Permits
(collectively the "Assigned Interests").
2. The following terms shall have the following meanings:
(a) The term "Warranties and Guaranties" as used herein shall mean and
include all warranties and guarantees to the extent assignable, whether or not
written, to the extent relating to all or any portion of the Property, including
without limitation the Improvements, including without limitation construction
warranties from contractors and subcontractors.
(b) The term "Intangible Property" as used herein shall mean and
include all intangible property used exclusively in connection with the
Property.
(c) The term "Permits" as used herein shall mean and include all
governmental permits and approvals to the extent relating to the construction,
operation, use or occupancy of the Property.
3. This Assignment shall be binding on and inure to the benefit of
Assignee and Assignor, and their respective heirs, executors, administrators,
successors-in-interest and assigns.
4. This Assignment shall be governed by and construed in accordance with
the laws of the State of California.
5. Nothing contained herein shall be deemed or construed as relieving the
Assignor or Assignee of their respective duties and obligations under the
Purchase Agreement.
IN WITNESS WHEREOF, Assignor has executed this Assignment as of the date
first above written.
CRBC, LLC,
a California limited liability company
By:
------------------------------------------
John E. Quinton, President
Schedule 1
LEGAL DESCRIPTION OF REAL PROPERTY
PURCHASE AND SALE AGREEMENT
AND JOINT ESCROW INSTRUCTIONS
by and between
CRBC, LLC,
a California limited liability company,
"Seller"
and
DCH TECHNOLOGY, INC.,
a Colorado corporation,
"Buyer"
April 13, 2000