EXHIBIT 10.2
AGREEMENT TO PURCHASE REAL PROPERTY
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THIS AGREEMENT TO PURCHASE REAL PROPERTY ("Agreement") is dated
March 30, 1998, for reference purposes only, and is made by and between
OBJECTIVE SYSTEMS INTEGRATORS, INC., a Delaware corporation, ("Seller") and
REDSKY ENTERPRISES, INC., a California corporation ("Buyer").
ARTICLE 1
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DEFINITIONS
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For purposes of this Agreement, the following terms shall have the
following meanings:
1.1 CLOSE OF ESCROW. The term "Close of Escrow" shall mean the date
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upon which title to the Property is transferred of record to Buyer.
1.2 HAZARDOUS MATERIALS. The term "Hazardous Materials" shall mean any
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hazardous or toxic substance, material or waste which is or becomes regulated by
any local governmental authority, the State of California or the United States
government. The term "Hazardous Materials" includes, without limitation,
petroleum and petroleum products, asbestos, and any material or substance which
is (i) listed under Article 9 or defined as hazardous or extremely hazardous
pursuant to Article 11 of Title XXII of the California Administrative Code,
Division 4, Chapter 20, (ii) defined as a "hazardous waste" pursuant to Section
1004 of the Federal Resource Conversation and Recovery Act, 42 U.S.C. (S) 6901
et seq., or (iii) defined as a "hazardous substance" pursuant to Section 101 of
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the Comprehensive Environmental Response, Compensation and Liability Act, 42
U.S.C. (S) 9601 et seq. The term "Hazardous Materials Laws" shall mean (i) all
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of the foregoing laws, as amended from time to time, and (ii) any other federal,
state or local law, ordinance, regulation or order regulating Hazardous
Materials.
1.3 EFFECTIVE DATE OF THIS AGREEMENT. This Agreement shall be effective
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on, and the term "Effective Date" shall mean, the date this Agreement is
executed by the last designated signatory to this Agreement.
1.4 ESCROW HOLDER. The term "Escrow Holder" shall mean Xxxxxxx Title of
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Sacramento, 000 Xxxxxxx Xxxx, Xxxxxxxxxx, Xxxxxxxxxx 00000 or such other escrow
company as Buyer and Seller shall agree to in writing.
1.5 LAWS. The term "Laws" or "Law" shall mean all local, regional,
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municipal, county, state, and federal statutes, regulations, ordinances, orders,
judgments, codes, rules, permits or other laws applicable to or affecting the
ownership, operation or use of the Property or any portion thereof (including,
without limitation, health, safety, subdivision, environmental, and zoning
laws).
1.6 LEASE. The term "Lease" shall mean collectively that certain Lease
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(Phase I) between Buyer, as Landlord, and Seller, as Tenant, concerning the
Property (as defined in this Agreement below), and improvements to be
constructed thereon dated as of January 13, 1998, as amended by that certain
First Amendment to Lease between Buyer, as Landlord, and Seller, as Tenant,
dated as of March, 1998.
1.7 PROPERTY. The term the "Property" shall mean and collectively refer
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to that certain real property owned by Seller located at 000 Xxxxxxxx Xxxx, in
the City of Folsom, State of California, more particularly described on the
attached Exhibit "A", consisting of approximately 3.23 acres of land (the
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"Property") and all rights, privileges and easements appurtenant to the land.
ARTICLE 2
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TERMS OF PURCHASE
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2.1 AGREEMENT TO PURCHASE AND SELL. Buyer agrees to purchase the
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Property from Seller, and Seller agrees to sell the Property to Buyer, upon the
terms and conditions contained in this Agreement.
2.2 PURCHASE PRICE. The purchase price for the Property shall be Five
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Hundred Ninety-Seven Thousand, Nine Hundred and Seventy Dollars ($597,970.00)
(the "Purchase Price").
2.3 TERMS OF PAYMENT. Buyer shall pay to Seller, or to Escrow Holder
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for Seller's account, the Purchase Price in cash at Close of Escrow.
ARTICLE 3
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BUYER'S ACCESS RIGHTS
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3.1 ACCESS. Seller and Buyer hereby acknowledge that Seller is selling
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the Property to Buyer in connection with a build-to-suit lease transaction
whereby Buyer will purchase the Property from Seller and construct certain
improvements thereon, as defined and as more particularly described in the Lease
(collectively, the "Improvements") and Buyer, as Landlord, will lease the
Property, including all Improvements constructed thereon, to Seller in
accordance with the terms of the Lease. In connection therewith, Seller hereby
agrees that Buyer shall have access to, and use of, the Property prior to Close
of Escrow for the sole purpose of grading and site work in connection with the
construction of the Improvements. Buyer shall indemnify, defend, protect Seller
against and hold Seller harmless from any and all losses, costs, damages,
liabilities, claims, actions, judgments and expenses, including, without
limitation, reasonable attorneys' fees ("Losses"), to the extent resulting from,
incurred as a result of, or in any way related to or arising from (a) the entry
or
presence upon or use of the Property by Buyer, Buyer's agents, employees,
contractors or invitees or (b) any act or omission of Buyer or Buyer's agents,
employees, contractors or invitees in connection with the Property.
Notwithstanding anything to the contrary in this Agreement, the foregoing
indemnity shall survive the termination of this Agreement.
ARTICLE 4
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REPRESENTATIONS AND COVENANTS
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4.1 SELLER'S REPRESENTATIONS. As of the Close of Escrow, Seller states,
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warrants and represents as follows. It shall be an express condition precedent
to Buyer's obligation to purchase the Property that the following
representations and warranties be true and correct as of the Close of Escrow,
and such representations and warranties shall survive the Close of Escrow for a
period of one (1) year following the Close of Escrow to the extent any of such
representations and warranties are not true and correct as of the date of the
Close of Escrow:
A. AUTHORITY. Seller is the sole legal owner of the Property and
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Seller has the full power, capacity, authority and legal right to execute and
deliver this Agreement and to perform the obligations of Seller hereunder
(including, without limitation, the conveyance of the Property to Buyer).
B. CLAIMS. Seller has no knowledge of any pending condemnation or
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special assessment against the Property, any lawsuits which will affect the
Property, nor any other claim, action, suit or proceeding at law or in equity,
by or before any administrative or governmental authority affecting the
Property.
C. NON-FOREIGN STATUS. Seller is not a "foreign person" within the
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meaning of IRC Section 1445(f)(d).
D. BANKRUPTCY PROCEEDINGS. No proceedings under any bankruptcy or
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insolvency laws have been commenced by or against Seller which have not been
terminated; no general assignment for the benefit of creditors has been made by
Seller; and no trustee or receiver of Seller's property has been appointed.
4.2 BUYER'S REPRESENTATIONS. As of the Effective Date and as of Close
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of Escrow, Buyer states, warrants and represents, which representations and
warranties shall survive the Close of Escrow and shall be true and correct as of
the Close of Escrow, that this Agreement and all documents executed by Buyer
which are to be delivered to Seller at the Close of Escrow are duly authorized,
executed, and delivered by Buyer, and are, or at the Close of Escrow will be,
legal, valid, and binding obligations of Buyer, and do not, and at the time of
Close of Escrow will not, violate any provisions of any agreement to which Buyer
is a party or to which it is subject or any law, judgment or order applicable to
Buyer.
ARTICLE 5
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CLOSE OF ESCROW
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5.1 ESCROW.
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A. OPENING OF ESCROW. Seller shall deliver a copy of this
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Agreement to Escrow Holder. The transaction contemplated by this Agreement
shall be consummated through an escrow opened with Escrow Holder, and Seller and
Buyer each agree to deposit with Escrow Holder prior to the Required Closing
Date (as defined below) all funds and documents necessary to consummate the
transaction contemplated by this Agreement in accordance with the terms and
conditions of this Agreement.
B. REQUIRED CLOSING DATE. The Close of Escrow shall occur on or
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before Wednesday, April 15, 1998 at the offices of the Escrow Holder, or at such
other time and place as Buyer and Seller shall agree in writing (the "Closing
Date"). The parties hereby agree that if either party to this Agreement cannot
close on or before the Closing Date for any reason, each party shall be entitled
to one (1) automatic extension of the Closing Date upon notice to the other
party for the period set forth in said party's notice, not to exceed thirty (30)
days. Notwithstanding the foregoing, the parties may agree to further
reasonably extend the Closing Date provided said extension is agreed to by both
parties in writing. Each party shall act reasonably in granting or denying its
consent to extend the Closing Date and shall reasonably cooperate with the other
party to facilitate the Close of Escrow.
C. PRORATIONS AND CLOSING COSTS.
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(1) TAXES. All real property taxes shall be prorated as of the
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Close of Escrow assuming a thirty (30) day month. At the Close of Escrow, the
parties shall prorate taxes based upon the most recently available tax bills;
provided, however, that if the actual amount of taxes differs from said
estimated amount, the party entitled to receive an adjustment from the other
party shall receive a reimbursement of any overpayment upon presentation of a
written demand and the actual tax xxxx.
(2) ASSESSMENTS. Buyer shall assume any existing assessments
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affecting the Property and any payments due thereunder shall be prorated as of
the Close of Escrow, or created by or as a result of any action of Buyer or its
agents, employees, contractors, or invitees (including without limitation any
mechanic's or materialmen's liens).
(3) UTILITY CHARGES. All utility (including, without
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limitation, electricity, gas, water, sewer and telephone) charges, if any, will
be prorated to the date of Close of Escrow and
Buyer will obtain a canceled xxxx therefor. All utility security deposits paid
by Seller, if any, will be retained by Seller.
(4) CLOSING COSTS. Seller, at its sole cost and expense, shall
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pay at Close of Escrow the escrow fees, recording costs, any county transfer or
documentary tax and one half (1/2) of any city transfer tax due in connection
with the transfer of the Property, and the premium for a CLTA owner's policy of
title insurance. Buyer shall pay one half (1/2) of the cost of any city
transfer tax due in connection with the transfer of the Property, the cost of an
ALTA owner's policy (in excess of the cost of a CLTA owner's policy for the
Property) and the cost of any additional endorsements that Buyer shall request.
All other closing costs shall be paid in accordance with the custom of
Sacramento County.
5.2 POSSESSION. At the Close of Escrow, possession of the Property
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shall be delivered to Buyer in its then-existing condition.
5.3 DOCUMENTS AT CLOSING.
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A. SELLER'S DEPOSIT. Prior to the Close of Escrow, Seller shall
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deliver to Escrow Holder the following:
(1) A standard form of grant deed, prepared by Escrow Holder;
(2) An affidavit certifying that Seller is not a "foreign
person" under Section 1445 of the Internal Revenue Code of 1986, as amended;
(3) The closing costs as described in Paragraph 5.1.C.(4);
Such other documents as may reasonably be required to complete the Close of
Escrow.
B. BUYER'S DEPOSIT. Prior to the Close of Escrow, Buyer or Buyer's
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lender shall deliver to Escrow Holder cash in an amount sufficient to satisfy
Buyer's obligations under this Agreement and any documents reasonably required
to complete the Close of Escrow.
ARTICLE 6
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"AS IS" CONDITION
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6.1 ACCEPTANCE OF PROPERTY. If Buyer acquires the Property from Seller
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pursuant to this Agreement, then from and after Close of Escrow the following
shall apply to all matters, including without limitation matters dealing with
Hazardous Materials, and the following shall survive Close of Escrow:
A. "AS IS" CONDITION. Buyer acknowledges that Buyer has already
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conducted or has already had the full opportunity to conduct, prior to the
Effective Date, studies and investigations of the Property as fully as Buyer
desires, and Buyer hereby acknowledges that it has had the right to observe and
has observed the physical characteristics and condition of the Property. Buyer
acknowledges and agrees that the Property is to be purchased and accepted by
Buyer in its condition as of the Close of Escrow, "as is", without any implied
or express warranty or representation by Seller and with all patent and latent
defects, except as otherwise and specifically and expressly provided in this
Agreement. Buyer acknowledges that neither Seller nor any of Seller's
employees, agents or representatives has made any representations, warranties or
agreements by or on behalf of Seller not contained in this Agreement as to any
matters concerning the Property, the present use or condition thereof, or the
suitability of the Property for Buyer's intended use thereof. This disclaimer
applies without limitation to Hazardous Materials, topography, climate, air,
water rights, utilities, water, present and future zoning, soil, subsoil,
purposes to which the Property may be suited, drainage, access to public roads,
proposed routes of roads or extensions thereof, title and Hazardous Materials
and land use Laws and regulations to which the Property may be subject.
ARTICLE 7
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GENERAL PROVISIONS
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7.1 BROKERAGE COMMISSIONS. Buyer and Seller hereby acknowledge that no
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broker's commission or finder's fee is payable with regard to this transaction.
Buyer and Seller each agree to indemnify, defend and hold the other harmless
from and against all liability, claims, demands, damages, or costs of any kind
arising from or connected with any broker's commission or finder's fee or other
charge claimed to be due any person arising from the indemnifying party's
conduct with respect to this transaction.
7.2 NOTICES. Any notice required or permitted to be given with respect
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to the subject matter of this Agreement shall be in writing and shall be deemed
properly delivered, given or served (i) when personally served, or (ii) on the
date shown for delivery or rejection on a return receipt, if the notice is
deposited in the U.S. mail, certified, return receipt requested, postage
prepaid, addressed as follows:
TO SELLER OBJECTIVE SYSTEMS INTEGRATORS, INC.
--------- 000 Xxxx Xxxxxx Xxxx
Xxxxxx, Xxxxxxxxxx 00000
Attn: Xxxxx Xxxxx
With a copy to: Wilson, Sonsini, Xxxxxxxx & Xxxxxx
000 Xxxx Xxxx Xxxx
Xxxx Xxxx, Xxxxxxxxxx 00000-0000
Attn: Xxxxxxxx X. X'Xxxxx, Esq.
TO BUYER REDSKY ENTERPRISES, INC.
-------- 0000 Xxxxxxx Xxxx, Xxxxx X
Xxxxxxxxxx, Xxxxxxxxxx 00000
Attn: Xxxxx X. Xxxxxxx
President
With a copy to: Panattoni Law Firm
0000 Xxxxxxx Xxxx, Xxxxx X
Xxxxxxxxxx, Xxxxxxxxxx 00000
Attn: X.X. Xxxxxx
TO ESCROW HOLDER: Xxxxxxx Title of Sacramento
---------------- 000 Xxxxxxx Xxxx
Xxxxxxxxxx, Xxxxxxxxxx 00000
The above parties may change the address to which notices shall thereafter be
delivered by giving three (3) days' prior written notice to all other parties in
the manner set forth in this paragraph.
7.3 ATTORNEYS' FEES. If any legal action is commenced concerning the
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Property, this Agreement, or the rights and duties of any party in relation
thereto, the prevailing party in such litigation shall be entitled to reasonable
attorneys' fees in an amount set by the court. Should either party become the
subject of any bankruptcy or insolvency proceeding, the other party shall be
entitled to all reasonable attorneys' fees and costs incurred to establish any
right under this Agreement, or to obtain adequate assurances or relief from the
effects of the bankruptcy or insolvency proceeding.
7.4 FURTHER ASSURANCES. Each party shall perform or cause to be performed
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all acts and execute, acknowledge and deliver, or cause to be executed,
acknowledged and delivered, all instruments and documents as may be reasonably
required to carry out the intent and purpose of this Agreement.
7.5 ENTIRE AGREEMENT. This Agreement and that certain Remedy Agreement
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between Buyer and Seller dated as of the same date of this Agreement constitute
the entire agreement between the parties (and supersedes all other agreements,
whether written or oral) respecting the purchase of the Property by Buyer;
except for the foregoing, no other agreement, statement or promise made by
either party hereto with respect to the purchase of the Property by Buyer shall
be binding or valid. This Agreement may be executed simultaneously or in
counterparts, each of which shall be deemed an original but all of which
together shall constitute one and the same contract.
7.6 AMENDMENTS. This Agreement shall not be modified by either party by
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oral representations made before or after the execution of this Agreement, and
all amendments to this Agreement must be in writing and signed by Buyer and
Seller.
7.7 ASSIGNMENT; BINDING EFFECT. Buyer may not assign this Agreement and
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any purported assignment of this Agreement by Buyer shall be void and of no
effect. Except as provided in the preceding sentence, this Agreement shall be
binding upon and inure to the benefit of Seller and Buyer and their respective
assigns, heirs, successors and legal representatives.
7.8 INTERPRETATION. Each party and its counsel have reviewed this
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Agreement. Any rule of construction, to the effect that ambiguities are to be
resolved against the drafting party, shall not apply in the interpretation of
this Agreement. The captions of this Agreement are for convenience and
reference only, and the words contained therein shall not be deemed to explain,
modify, amplify or aid in the interpretation, construction or meaning of the
provisions of this Agreement. This Agreement shall be construed and interpreted
under, and governed and enforced according to, the laws of the State of
California. If any provisions of this Agreement are held to be unenforceable or
invalid, it is the specific intent of the parties that the remaining provisions
shall be of full force and effect.
7.9 SURVIVAL OF COVENANTS. Except as otherwise provided herein, the
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covenants contained in this Agreement shall survive the closing of the purchase
and sale, and shall not be deemed merged in the grant deed to be delivered by
Seller to Buyer pursuant to this Agreement but shall remain in full force and
effect.
7.10 TIME OF ESSENCE. Time is of the essence in the performance of this
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Agreement.
IN WITNESS WHEREOF, the parties have executed this Agreement on the
respective dates set forth below.
"SELLER" "BUYER"
OBJECTIVE SYSTEMS INTEGRATORS, REDSKY ENTERPRISES, INC.,
INC., a Delaware corporation a California corporation
By: /s/ Xxxxxx X. Xxxxxxx By: /s/ Xxxxx X. Xxxxxxx
Printed Printed
Name: Xxxxxx X. Xxxxxxx Name: Xxxxx X. Xxxxxxx
Title: V.P. General Counsel Title: President
Date: March 26, 1998 Date: March 30, 1998
EXHIBIT "A"
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Legal Description of Property
LEGAL DESCRIPTION FOR A PORTION OF XXX 0,
"XXXX XXXXXX XXXXXXXXXX XXXX (000X.X.00)"
XXXX OF FOLSOM, COUNTY OF SACRAMENTO, CALIFORNIA
All that portion of Lot 3 as said Lot is shown on that certain Plat of "LAKE
FOREST INDUSTRIAL
PARK" filed in the office of the Recorder, County of Sacramento, State of
California in Book 142 of
Maps, Map No. 12 more particularly described as follows:
Beginning at the southeast corner of said Lot; thence from said Point of
beginning along the southeasterly and southwesterly lines of said Lot the
following five courses: 1) South 54 degrees 36'19" West 147.13 feet; 2) along
the arc of a curve to the left having a radius of 520.00 feet said Arc being
subtended by a chord bearing South 49 degrees 57'49" West 84.15 feet to a point
of reverse curvature; 3) along the arc of a curve to the right having a radius
of 25.00 feet, said Arc being subtended by a chord bearing South 87 degrees
25'37" West 33.52 feet; 4) North 50 degrees 28' 08" West 7.78 feet; and 5) along
the arc of a curve to the left having a radius of 430.00 feet, said Arc being
subtended by a chord bearing North 65 degrees 45'50" West 226.86 feet; thence
North 08 degrees 16'30" East 46.50 feet; thence North 35 degrees 23'41" West
124.66 feet; thence North 42 degrees 56'46" East 155.52 feet; thence North 75
degrees 35'28" East 323.57 feet to a point on the easterly line of said Lot;
thence along said Easterly line South 14 degrees 24'32" East 308.94 feet to the
point of beginning.
