HomeMy WebLinkAboutSale of City Owned Property - Gothard and Main Street to adj Council/Agency Meeting Held _
Deferred/Continued to
I�Ap oved ❑ Conditionally Approved ❑ Denied C ler s Signaf e
Council Meeting Date August 2 2010 Department ID Number ED 10-031
CITY OF HUNTINGTON BEACH
REQUEST FOR CITY COUNCIL ACTION
SUBMITTED TO Honorable Mayor and City Council Members
SUBMITTED BY Fred A Wilson City Administrator
PREPARED BY Stanley Smalewitz Director of Economic Development
Travis K Hopkins PE Director of Public Works
SUBJECT Approve and authorize execution of the agreement for sale of City
owned property near the intersection of Gothard and Main St to the
adjacent owner Gustafson Partners LLC
Statement of Issue Approve sale of City owned property (as described in Exhibit A and B
of attached Agreement) to the adjacent property owner, Gustafson Partners, LLC for the
amount of$22 000
Fit,ancialImpact Not applicable Buyer Gustafson Partners LLC shall pay all
wording fees documentary transfer taxes escrow fees, policies of title insurance and any
tier costs connected with the closing of this transaction
,,recommended Action Motion to
A) Approve the Agreement for Sale of Surplus Real Property and Escrow Instructions for
the sale of surplus property to buyer Gustafson Partners LLC and
B) Authorize the Mayor and City Clerk to execute the Agreement for Sale of Surplus Real
Property and Escrow Instructions By and Between the City of Huntington Beach and
Gustafson Partners LLC and all other related documents to convey ownership of the
surplus property and
C) Authorize the Director of Economic Development to execute any other related escrow
documents
Aiternatove Action(s)
Do not approve the Agreement
-81- 9tem 5 - Page I
REQUEST FOR COUNCIL ACTION
MEETING DATE 8/2/2010 DEPARTMENT ID NUMBER ED 10-031
Analyses
As a result of the Gothard Street widening and realignment the City currently owns a small
2 073 square foot remnant parcel at the east end of Clay Avenue The parcel is not
developable independently however combined with the adjacent property owner Gustafson
Partners LLC there is a value Gustafson has offered to purchase the City owned property
for $22 000 which is the fair market value per the appraisal report Gustafson plans to loin
this remnant parcel to his existing vacant property to make a larger more developable parcel
in the future
Resolution No 2009-71 declaring the disposition of this property as surplus was approved by
City Council at the November 16 2009 City Council meeting At the same meeting City
Council approved the sale of this property to Joe Gergen, who was the former property
owner of the adjacent property However since that time the sale fell out of escrow and Mr
Gergen has sold his adjacent property to Gustafson Partners LLC
Public Works and Economic Development staff have confirmed with other City Departments
that they do not have any use or need for the property Pursuant to Government Code
54221 this land is exempt for any surplus land requirements therefore it was not necessary
to notify other public agencies
General Plan Conformance No 09-003 allows for the reversion/sale of this property to the
adjacent owners Additionally Chapter 3 06 of the Huntington Beach Municipal Code allows
the Council to determine that disposition of surplus real property to the adjacent owners is in
the public s interest
Staff recommends that the City Council adopt a resolution declaring the property surplus and
also approve the sale to the adjacent property owner Gustafson Partners LLC for the
appraised value of$22 000
Environmental Status Not applicable
Strategic Plan Goal Maintain improve and obtain funding for infrastructure and equipment
Attachment(s)
® riptida,
1 Resolution No 2009-71 A Resolution of the City Council of the City
of Huntington Beach Declaring the Disposition of Certain Surplus
Property
2 Acireement for Sale of Surplus Real Property and Escrow Instructions
3 Aerial Ma
Item 5 - Page 2 -52-
ATTACHMENT # 1
}
RESOLUTION NO 2009-71
A RESOLUTION OF THE CITY COUNCIL OF THE
CITY OF HUNTINGTON BEACH DECLARING THE
DISPOSITION OF CERTAIN SURPLUS PROPERTY
WHEREAS the City of Huntington Beach is the owner of certain real property near
the intersection of Gothard Street and Main Street(the"Parcel") as more particularly set forth
in the legal description and sketch attached hereto as Exhibits `N and"B,"respectively, and
The City acquired the parcel as follows
By Grant Deed from the Clerk of the U S Bankruptcy Court dated January 10,2003,
and recorded on January 21 2003 as Instrument no 2003800075401 of Official
Records County of Orange California and
The City Administrator has recommended to this Council the Parcel be declared
Surplus Real Property pursuant to Chapter 3 06 of the Huntington Beach Municipal Code
which authorizes the City to dispose of Surplus Property, and sets out the procedures
therefore,
NOW THEREFORE the City Council of the City of Huntington Beach does find
determine and resolve as follows
1 That the Parcel as described above is surplus and the public interest and
necessity require the disposition thereof, and
2 The Parcel has been appraised to establish the fair market value and
3 The costs incurred in preparing the Parcel for sale including all related
expenses and appraisal fees have been added to and made a part of the value to be paid on the
sale of the Parcel and
4 The Parcel is to be sold for cash to the adjacent property owner for the amount
of$22 000 00 as described in the Agreement for Acquisition and Escrow Instructions to be
approved concurrently herewith and
5 The City Administrator is hereby authorized and directed to execute all
documents and take all steps necessary to dispose of such Surplus Property pursuant to the
determinations of this Council and the procedures set forth in Chapter 3 06 of the Huntington
Beach Municipal Code
07 962 002J35345 doc
Item 5 e Page 4 -84-
Resolution No 2009-71
PASSED AND ADOPTED by the City Council of the City of Huntington Beach at a
regular meeting thereof held on the 16th day of November 200 9
94iw/S r4-,
Mayor
REVIE APPROVED MTIATED AND APPROVED
City A 1 trator Director of Economic evelopment
APPROVED AS TO FORM
ty Att mey U
07 962 OOM5345 doc 2
-85- Steam 5 e wage 5
Resolution No 2009-71
EXHIBIT "A"
LEC,AL DESCRIPTION
THAT PORTION OF LOT 22 BLOCK "B OF THE GARFIELD ADDITION TO HUNT€NGTON BEACH IN THE
CITY OF HUNTINGTON BEACH COUNTY OF ORANGE STATE OF CALIFORNIA AS SHOWN ON A MAP
RECORDED IN BOOK 7 PAGES 27 AND 28 OF MISCELLANEOUS MAPS IN THE OFFICE OF THE COUNTY
RECORDER OF SAID COUNTY MORE DESCRIBED ASFOLLOWS
BEGINNING AT THE SOUTHWEST CORNER OF SAID LOT 22 THENCE ALONG THE WESTERLY LINE OF SAID
OF SAID LOT 22 N1918 29"E 74 37 FEET TO THE SOUTHEASTERLY CORNER OF THE "FINAL ORDER
OF CONDEMNATION" RECORDED AUGUST 13 1999 AS INSTRUMENT NO 99-592245 OF OFFICIAL
RECORDS SAID CORNER IS ALSO ON A NONTANGENT CURVE CONCAVE TO NORTHEAST HAVING A
RADIUS OF 370 DO FEET A RADIAL LINE THROUGH SAID CORNER BEARS S39 41 05"W THENCE
SOUTHEASTERLY ALONG SAID CURVE 56 08 FEET THROUGH A CENTRAL ANGLE OF 8141 00" TO A POINT
A RADIAL BEARING THROUGH SAID POINT BEARS S31 41 05"W THENCE S31 23 28 W 7 11 FEET
TO A POINT ON A NONTANGENT CURVE CONCAVE TO THE SOUTHEAST HAVING A RADIUS OF 42 00 FEET
A RADIAL BEARING THROUGH SAID POINT BEARS N2 09 33 E THENCE SOUTHWESTERLY ALONG SAID
CURVE 39 85 FEET THOUGH A CENTRAL ANGLE OF 54 2156 TO A POINT OF REVERSE CURVATURE
WITH A CURVE CONCAVE TO THE NORTHWEST HAVING A RADIUS OF 40 00 FEET THENCE SOUTHWESTERLY
ALONG SAID CURVE 36 85 FEET THROUGH A CENTRAL ANGLE OF 52 30 08 TO THE POINT OF BEGINNING
CONTAINING AN AREA OF 2073 SOUARE FEET MORE OR LESS
AS SHOWN ON EXIBIT "B" ATTACHED HERETO AND MADE A PART HEREOF
PREPARED BY
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ATTACHMENT #2
AGREEMENT FOR SALE OF SURPLUS REAL PROPERTY AND
ESCROW INSTRUCTIONS BY AND BETWEEN THE
CITY OF HUNTINGTON BEACH AND GUSTAFSON PARTNERS, LLC
This Sales Agreement ('Agreement") is made and entered into on this �j N� day of
20_ZO by and between the City of Huntington Beach, a California
municipal corporation, ("City")and Gustafson Partners, LLC ('Buyer")collectively the"Parties"
WHEREAS, the City owns that certain real property located in the City of Huntington
Beach, Orange County, California, which pursuant to Huntington Beach Municipal Code Chapter
3 06 has been determined to be surplus real property and available for disposal, and
n The City Council authorized the disposal of the surplus real property on
ffG[4asr b.,2010
NOW, THEREFORE, in consideration of the foregoing recitals and for other good and
valuable consideration,the Parties agree as follows
1 PROPERTY
11 Property City agrees to sell and convey to Buyer, and Buyer agrees to
purchase from City, the real property (Property), hereinafter described, subject to the terms and
conditions set forth in this Agreement The real property that is the subject of this offer consists of
approximately 2073 square feet located in the City of Huntington Beach, County of Orange, State of
California and legally described in the attached Exhibits"A"and B "
2 PURCHASE PRICE
21 Purchase Price The total purchase price to be paid by Buyer to City for
Property shall be Twenty-Two Thousand Dollars($22,000 00)
22 Payment of the Purchase Price The Purchase Price for the Property shall
be payable by Buyer as follows Upon the Close of Escrow, Buyer shall deposit or cause to be
deposited with Escrow Holder, in cash or by a certified or bank cashier's check made payable to
Escrow Holder or a confirmed wire transfer of funds, the Purchase Price plus Escrow Holder's
estimate of Buyer's closing costs, prorations and charges payable pursuant to this Agreement All
escrow,recording and title insurance costs to be paid by Buyer
3 CONDITIONS OF SALE
31 Buyer's Costs Buyer shall pay all recording fees, documentary transfer
taxes escrow fees, policies of title insurance and any other costs connected with the closing of this
transaction
32 Further Documents and Assurances Buyer and City shall each, diligently
and in good faith, undertake all actions and procedures reasonably required to place the escrow in
condition for closing as and when required by this Agreement Buyer and City agree to execute and
deliver all further documents and instruments reasonably required by the escrow holder or Title
07 962 005/47455 Page 1 of 11
Company City shall deliver or cause to be delivered to escrow holder in time for delivery to Buyer
at the closing an original ink signed Grant Deed, duly executed and in recordable form, conveying
fee title to the Property to Buyer
33 Opening of Escrow For purposes of this Agreement, the Escrow shall be
deemed opened on the date Escrow Holder shall have received an executed counterpart of this
Agreement from both Buyer and City ("Opening Date") Escrow Holder shall notify Buyer and
City, in writing, of the date Escrow is opened and the Closing Date, as defined in Paragraph 3 4,
below In addition, Buyer and City agree to execute, deliver, and be bound by any reasonable or
customary supplemental escrow instructions of Escrow Holder, or other instruments as may
reasonably be required by Escrow Holder, in order to consummate the transaction contemplated by
this Agreement Any such supplemental instructions shall not conflict with, amend, or supersede
any portion of this Agreement If there is any inconsistency between such supplemental instructions
and this Agreement,this Agreement shall control
34 Close of Escrow For purposes of this Agreement, "Close of Escrow" shall
be defined as the date that the Grant Deed, conveying the Property to Buyer, is recorded in the
Official Records of Orange County, California This Escrow shall close within sixty (60) days of
the Opening Date("Closing Date")
35 Conditions of 'Title It shall be a condition to the Close of Escrow and a
covenant of City that title to the Property shall be conveyed to Buyer by City by the Grant Deed,
subject only to the following Approved Conditions of Title('Approved Condition of Title")
3 51 Matters affecting the Approved Condition of Title created by or with
the written consent of Buyer
3 5 2 Exceptions which are disclosed by the Report described in Paragraph
3 7 1 hereof and which are approved or deemed approved by Buyer in accordance with
Paragraph 3 7 1 hereof
City covenants and agrees that during the term of this Escrow, City will not cause or
permit title to the Property to differ from the Approved Condition of Title described in this
Paragraph Any liens, encumbrances, easements, restrictions, conditions, covenants, rights, rights-
of-way, or other matters affecting the Approved Condition of Title which may appear of record or
be revealed after the date of the Report described in Paragraph 3 7 1 below shall also be subject to
Buyer's approval and must be eliminated or ameliorated to Buyer's satisfaction by City prior to the
Close of Escrow as a condition to the Close of Escrow for Buyer's benefit
36 Title Policy Title shall be evidenced by the willingness of the Title
Company to issue its CLTA Standard Form Policy or Binder of Title Insurance ("Title Policy") in
the amount of the Purchase Price showing title to the Property vested in Buyer subject only to the
Approved Condition of Title
37 Conditions to Close of Escrow
3 71 Conditions to Buyer's Obligations The Close of Escrow and
Buyer's obligation to consummate the transaction contemplated by this Agreement are
07 962 005/47455 Page 2 of 11
subject to the satisfaction of the following conditions for Buyer's benefit on or prior to the
dates designated below for the satisfaction of such conditions
(a) Preliminary Title Report and Exceptions Immediately after
escrow is opened as provided herein, Buyer agrees to cause Stewart Title
Company to issue a Preliminary Title Report relating to the Property Within
fifteen (15) days after escrow has been opened, the Buyer will cause Stewart
Title Company to issue an Amendment to Escrow Instructions, which
indicates those title exceptions that the Buyer will accept City will have ten
(10) days after receipt of such amendment to review and approve it In the
event of non-approval, escrow will fail and each party will instruct Stewart
Title Company to cancel the escrow
(b) Representations, Warranties, and Covenants of City City shall
have duly performed each and every agreement to be performed by City
hereunder and City's representations, warranties, and covenants set forth in
Paragraph 4 shall be true and correct as of the Closing Date
(c) No Material Changes At the Closing Date,there shall have been no
material adverse changes in the physical or financial condition of the
Property
(d) Inspections and Studies On or before thirty (30) days after
Opening Date ("Due Diligence Period"), Buyer shall have approved the
results of any and all inspections, investigations, tests and studies (including,
without limitation, investigations with regard to governmental regulations,
engineering tests, soil and structure investigation and analysis seismic and
geologic reports) with respect to the Property (including all structural and
mechanical systems and leased areas) as Buyer may elect to make or obtain
The failure of Buyer to disapprove said results on or prior to the expiration of
the Due Diligence Period shall be deemed to constitute Buyer's approval of
the results The cost of any such inspections,tests and studies shall be borne
by Buyer During the term of this Escrow, Buyer, its agents, contractors and
subcontractors shall have the right to enter upon the Property, at reasonable
times during ordinary business hours, to make any and all inspections and
tests as may be necessary or desirable in Buyer's sole judgment and
discretion Buyer shall use care and consideration in connection with any of
its inspections Buyer shall indemnify and hold City and the Property
harmless from any and all damage arising out of, or resulting from the
negligence of Buyer, its agents, contractors and/or subcontractors in
connection with such entry and/or activities upon the Property Buyer will
provide City, upon request, at no cost, copies of any Buyer's investigation
reports obtained by the Buyer if any
(e) Council Approval The completion of this transaction, and the
escrow created hereby, is contingent upon the specific acceptance and
approval of the City by action of the City Council
07 962 005/47455 Page 3 of 11
(f) The property is sold in its present condition as of the date of
acceptance subject to the Buyer's investigation rights
3 7 2 Conditions to City's Obligation For the benefit of City, the Close
of Escrow shall be conditioned upon the occurrence and/or satisfaction of each of the
following conditions(or City's waiver thereof,it being agreed that City may waive any or all
of such conditions)
(a) Buyer's Obligations Buyer shall have timely performed all of the
obligations required by the terms of this Agreement to be performed by
Buyer, and
(b) Buyer's Representations All representations and warranties made
by Buyer to City in this Agreement shall be true and correct as of the Close
of Escrow
38 Deposits by City At least one (1) business day prior to the Close of
Escrow, City shall deposit or cause to be deposited with Escrow Holder the Grant Deed conveying
the Property to Buyer duly executed by City, acknowledged and in recordable form
39 Deposits by Buyer Buyer shall deposit, or cause to be deposited with
Escrow Holder,the funds which are to be applied toward the payment of the Purchase Price in the
amounts and at the tunes if designated herein (as reduced or increased by the prorations, debits and
credits hereinafter provided)
310 Costs and Expenses The cost and expense of the Title Policy attributable to
CLTA coverage shall be paid by Buyer The escrow fee of Escrow Holder shall be paid by Buyer
Buyer shall pay all documentary transfer taxes, if any, payable in connection with the recordation of
the Grant Deed The amount of such transfer taxes shall not be posted on the Grant Deed, but shall
be supplied by separate affidavit Buyer shall pay the Escrow Holder's customary charges to Buyer
and City for document drafting, recording, and miscellaneous charges If, as a result of no fault of
Buyer or City, Escrow fails to close, Buyer shall pay all of Escrow Holder's fees and charges
Penalties for prepayment of bona fide obligations secured by any existing Deed of trust or mortgage
shall be waived pursuant to Civil Code Procedures Section 1265 240
3 11 Disbursements and Other Actions by Escrow Holder Upon the Close of
Escrow,the Escrow holder shall promptly undertake all of the following in the manner indicated
3 11 1 Recording Cause the Grant Deed and any other documents, which
the parties hereto may mutually direct, to be recorded in the Official Records of Orange
County, California, in the order set forth in this subparagraph Escrow Holder is instructed
not to affix the amount of documentary transfer tax (if any) on the face of the Deed, but to
supply same by separate affidavit
3 112 Funds Disburse from funds deposited by Buyer with Escrow Holder
toward payment of all items chargeable to the account of Buyer,pursuant thereto in payment
of such costs, and disburse the balance of such funds, if any,to Buyer
3 113 Documents to Buyer Deliver when issued, the Title Policy to
Buyer
07 962 005/47455 Page 4 of 11
3 114 Pay demands of existing lienholders Escrow Holder is hereby
authorized and instructed to cause the reconveyance, or partial reconveyance, as the case
may be, of any such monetary exceptions to Buyer's title to the Property at or prior to the
Close of Escrow
4 CITY'S REPRESENTATIONS, WARRANTIES, AND DISCLOSURES In
addition to any express agreements of City contained herein, the following constitute
representations and warranties of City to Buyer, of this Agreement
41 Reliability of Information City obtained the information contained in tlus
Agreement from sources deemed reliable, however, City makes no guarantees as to the accuracy of
the information provided
42 Authority of State City is a government entity, duly organized and validly
existing under the laws of the State of California City has full power and authority to own, sell, and
convey the Property to Buyer and to enter into and perform its obligations pursuant to this
Agreement
43 Taxes City is exempt from property taxes and assessments and none are or
will be owing at close of escrow
44 Disclosures Buyer acknowledges that Buyer is purchasing the Property
solely in reliance on Buyer's own investigations No representations or warranties of any kind
whatsoever, expressed or implied, have been made by City, City's agents, or employees, including
in any investigations, studies or documents identified under Section 4 6 below Buyer further
acknowledges and warrants that as of the close of escrow Buyer will be aware of all zoning
regulations, other governmental requirements, site and physical conditions (including the presence
of hazardous materials or other adverse environmental conditions) and other matters affecting the
use and condition of the Property including any investigations, studies, and documents identified in
section 4 6 Buyer agrees to purchase the Property in the condition that it is in at close of escrow,
subject, however, to Buyer's right to terminate should the Property be damaged or destroyed by
causes other than causes attributable to Buyer's entry on the Property and inspections ordered by
Buyer prior to close of escrow Buyer shall be responsible at Buyer's sole expense for any or all
remediation required to make Property usable for Buyer's intended purpose
45 As-Is Purchase Except as provided in paragraph 4 4, Buyer specifically
acknowledges and agrees that City will sell and Buyer will purchase the Property on an"as is with
all faults" basis, and that having been given the opportunity to inspect the Property and review
information and documentation affecting the Property, Buyer is not relying on any representations
or warranties of any kind whatsoever, express or implied, from City or its agents as to any matters
concerning the Property, including without limitation (i) the quality, nature, adequacy, and
physical condition of the Property including soils, geology, and any groundwater, (ii)the existence,
quality, nature, adequacy, and physical condition of utilities serving the Property, (in) the
development potential of the Property and the Property's use, merchantability, fitness, suitability,
value, or adequacy of the Property for any particular purpose, (iv) the zoning or other legal status
of the Property or any other public or private restrictions on use of the Property, (v)the compliance
of the Property or its operation with any applicable codes, laws, regulations, statutes, ordinances,
covenants, conditions, and restrictions of any governmental or quasi-governmental entity or of any
07 962 005/47455 Page 5 of 11
other person or entity, (vi)the presence of hazardous materials on, under, or about the Property or
the adjoining or neighboring property, (vn) the condition of title to the Property, and (vni) the
economics of the operation of the Property
46 Existing Investigations,Studies, and Documents Buyer has knowledge of
the following investigations, studies, and documents as provided by City in connection with his/her
decision to purchase the Property These reports and documents relating to the Property disclosed
by City are true and correct originals or copies thereof City makes no representations or warranties
nor expresses or implies any opinion concerning their accuracy
1
2
3
47 Absence of Fraud and Misleading Statements To the best of City's
knowledge, no statement of City in this Agreement or in any document, certificate, or schedule
furnished or to be furnished to Buyer pursuant hereto or in connection with the transaction
contemplated hereby contains any untrue statement of material fact
48 General Representation No representation warranty or statement of City
in this Agreement or in any document, certificate or schedule furnished or to be furnished to Buyer
pursuant hereto contains or will contain any untrue statement of a material fact or omits or will omit
to state a material fact necessary to make the statements or facts contained therein not misleading
City's representations and warranties made in this Agreement shall be continuing and shall be true
and correct as of the date of the close of escrow with the same force and effect as if remade by City
in a separate certificate at that time The truth and accuracy of City's representations and warranties
made herein shall constitute a condition for the benefit of Buyer to the close of escrow (as
elsewhere provided herein) and shall not merge into the close of escrow or the recordation of the
Grant Deed in the Official Records, and shall survive the close of escrow
5 BUYER'S REPRESENTATIONS AND WARRANTIES In addition to any
express agreements of Buyer contained herein, the following constitute representations and
warranties of Buyer to City,of this Agreement
51 Representations Regarding Buyer's Authority
(a) Buyer has the legal power, right and authority to enter into this
Agreement and the instruments referenced herein, and to consummate the transactions contemplated
hereby
(b) The individuals executing this Agreement and the instruments
referenced herein on behalf of Buyer have the legal power,right, and actual authority to bind Buyer
to the terms and conditions hereof and thereof
(c) This Agreement is, and all other instruments, documents and
agreements required to be executed and delivered by Buyer in connection with this Agreement are
and shall be, duly authorized, executed and delivered by Buyer and shall be valid, legally binding
obligations of and enforceable against Buyer in accordance with their terms
(d) All regmsrte action (corporate, trust, partnership or otherwise) has
been taken by Buyer in connection with the entering into this Agreement, the instruments
referenced herein, and the consummation of the transactions contemplated hereby No consent of
07 962 005/47455 Page 6 of 11
any partner, shareholder, creditor, investor,judicial or administrative body, authority other party is
required
(e) Neither the execution and delivery of this Agreement and documents
referenced herein, nor the incurrence of the obligations set forth herein, nor the consummation of
the transactions herein contemplated, nor compliance with the terms of this Agreement and the
documents referenced herein conflict with or result in the material breach of any terms, conditions
or provisions of, or constitute a default under, any bond, note, or other evidence of indebtedness or
any contract, indenture, mortgage, Deed of trust, loan, partnership agreement, lease or other
agreements or instruments to which Buyer is a party or affecting the Property
52 General Representation No representation, warranty or statement of Buyer
in this Agreement or in any document, certificate or schedule furnished or to be furnished to City
pursuant hereto contains or will contain any untrue statement of a material fact or omits or will omit
to state a material fact necessary to make the statements or facts contained therein not misleading
Buyer s representations and warranties made in this Agreement shall be continuing and shall be true
and correct as of the date of the close of escrow with the same force and effect as if remade by
Buyer in a separate certificate at that time The truth and accuracy of Buyer's representations and
warranties made herein shall constitute a condition for the benefit of City to the close of escrow(as
elsewhere provided herein) and shall not merge into the close of escrow or the recordation of the
Grant in the Official Records,and shall survive the close of escrow
6 DUE DILIGENCE
61 Buyer's Investigation of Property Condition Real property often contains
defects and conditions which are not readily apparent and which may affect the value or desirability
of the Property Therefore, it is the affirmative duty of Buyer to exercise reasonable care to discover
those facts which are unknown to Buyer or within the diligent attention and observation of Buyer
Buyer agrees to provide to City, at no cost, upon request of City, complete copies of all inspection
reports obtained by Buyer concerning the Property
62 Buyer's Acceptance of Property Condition Buyer's acceptance of the
condition of the Property is a contingency of this Agreement, accordingly Buyer shall have the
right to conduct inspections, investigations, tests surveys, and other studies at Buyer's expense
Buyer is strongly advised to exercise these rights and select professionals with appropriate
qualifications to conduct inspections of the entire Property If Buyer does not exercise these rights,
Buyer is acting against the advice of City
63 Scope of Buyer's Investigations Buyer agrees and warrants, or by the
failure to do so shall have waived any rights to do so hereunder,that at close of escrow Buyer shall
have investigated the condition and suitability of all aspects of the Property and all matters affecting
the value or desirability of the Property,including but not limited to the following
6 3 1 Condition of systems and components Foundation,plumbing, siding,
electrical, heating, mechanical, roof, air conditioning, built-in appliances, security, and any other
structural or nonstructural systems and components, and the energy efficiency of the Property
6 3 2 Size and age of improvements Room count, room dimensions, square
footage in improvement, lot size, and age of the improvements
6 3 3 banes and boundaries Property Imes and boundaries
07 962 005/47455 Page 7 of I I
6 3 4 Waste disposal Type, size, adequacy, and condition of sewer and/or
septic systems and components
6 3 5 Governmental requirements and limitations Availability of required
governmental permits, inspections, certificates, or other determinations affecting the Property
including historical significance Any limitations,restrictions,zoning, building size requirements, or
other requirements effecting the current or future use or development of the Property
6 3 6 Rent and occupancy controls Any restrictions that may limit the
amount of rent that can legally be charged and the maximum number of persons who can lawfully
occupy the Property
6 3 7 Water and utilities, well systems and components Availability,
adequacy, and condition of public or pnvate systems
6 3 8 Environmental hazards The presence of asbestos, formaldehyde,
radon, methane, other gases, lead based paint, other lead contamination, fuel or chemical storage
tanks, waste disposal sites, electromagnetic fields, and other substances, materials, products, or
conditions
639 Geologic conditions Geologic/seismic conditions, soil
stability/suitability, and drainage
6 3 10 Neighborhood, area, subdivision requirements Neighborhood or
area conditions including schools, proximity and adequacy of law enforcement, proximity to
commercial, industrial, or agricultural activities, crime statistics, fire protection, other governmental
services, existing and proposed transportation construction and development which may affect
noise view or traffic, airport noise, and noise or odor from any source, wild or domestic
6 311 Matters of record Covenants, conditions, and restrictions, Deed
restrictions, easements,and other title encumbrances of record
6 312 Other matters Any and all other matters such as availability of
suitable public infrastructure, assessment, other special service districts, and soil or other conditions
on the Property, not herein listed, which are or may be pertinent to Buyer's purpose for acquiring
the Property
7 INDEMNIFICATION Buyer shall defend, indemnify, and hold the City harmless
from and against any and all claims, liabilities, obligations, losses, damages, costs, and expenses,
including, but not limited to, attorney's fees, court costs, and litigation expenses that City may incur
or sustain by reason of or in connection with any misrepresentation made by the Buyer pursuant to
this Agreement
8 MINERAL RESERVATIONS City shall retain all mineral rights in the Property,
and the Grant Deed shall contain the following language
"EXCEPTING therefrom all oil, gas and other hydrocarbon substances and
minerals lying below a depth of 500 feet from the surface of said land, but
without the right of surface entry at any time upon said land or within the top 500
feet thereof, for the purpose of exploiting, developing, producing, removing and
marketing said substances"
9 PRIOR AGREEMENTS This Agreement, in effect as of the Date of Agreement,
supersedes any and all prior agreements (if any) between City and Buyer regarding purchase and
sale of the Property
07 962 005/47455 Page 8 of 11
10 NOTICES Any notice, tender, delivery, or other communication pursuant to this
Agreement shall be in writing and shall be deemed to be properly given if delivered, mailed or sent
by wire or other telegraphic communication in the manner provided in this Agreement to the
following persons
If to City If to Buyer
City of Huntington Beach Gustafson Partners,LLC
Attn Real Estate Services Attn John Gustafson
2000 Main Street 19161 Gothard Street
Huntington Beach,CA 92647 Huntington Beach, CA 92648
11 CALCULATION OF TIME Under this Agreement, when the day upon which
performance would otherwise be required or permitted is a Saturday Sunday or holiday, then the
time for performance shall be extended to the next day which is not a Saturday, Sunday or holiday
The term "holiday" shall mean all and only those State holidays specified in Sections 6700 and
7701 of the California Government Code
12 TIME OF ESSENCE Time is of the essence of this Agreement and each and every
provision hereof
13 ENTIRE AGREEMENT This Agreement shall constitute the entire understanding
and agreement of the Parties hereto regarding the purchase and sale of the Property and all prior
agreements, understandings, representations or negotiations are hereby superseded, terminated and
canceled in their entirety,and are of no further force or effect
14 AMENDMENTS This Agreement may not be modified or amended except in
writing by the Parties
15 APPLICABLE LAW The Parties hereto acknowledge that this Agreement has
been negotiated and entered into in the State of California The Parties hereto expressly agree that
this Agreement shall in all respects be governed by the laws of the State of California
16 SEVERABILITY Nothing contained herein shall be construed as to require the
commission of any act contrary to law, and wherever there is any conflict between any provision
contained herein and any present statute, law, ordinance or regulation as to which the Parties have
no legal right to contract, the latter shall prevail, but the affected provisions of this Agreement shall
be limited only to the extent necessary to bring them within the requirements of such law
17 SEPARATE COUNTERPARTS This Agreement may be executed in separate
counterparts, each of which when so executed shall be deemed to be an original Such counterparts
shall,together,constitute and be one and the same instrument
18 EXHIBITS The following Exhibits are attached to this Agreement and
incorporated by reference herein
Exhibit A Property Description
Exhibit B Property Sketch
07 962 005/47455 Page 9 of 11
19 SURVIVAL All terms and conditions in this Agreement, which represent
continuing obligations and duties of the Parties, that have not been satisfied prior to close of escrow
shall survive close of escrow and transfer of title to Buyer and shall continue to be binding on the
respective obligated party in accordance with their terms All representations and warranties and
statements made by the respective parties contained herein or made in writmg pursuant to this
Agreement are intended to be, and shall remain,true and correct as of the close of escrow, shall be
deemed to be material, and, together with all conditions, covenants and indemnities made by the
respective parties contained herein or made in writing pursuant to this Agreement (except as
otherwise expressly limited or expanded by the terms of this Agreement), shall survive the
execution and delivery of this Agreement and the close of escrow, or, to the extent the context
requires,beyond any termination of this Agreement
20 LEGAL FEES In the event suit is brought by either party to construe interpret
and/or enforce the terms and/or provisions of this Agreement or to secure the performance hereof,
each party shall bear its own attorney's fees, such that the prevailing party shall not be entitled to
recover its attorney's fees from the non-prevailing party
21 ASSIGNMENT Buyer may not assign, transfer or convey its rights or obligations
under this Agreement without the prior written consent of City, and then only if Buyer's assignee
assumes in writing all of Buyer's obligations hereunder, provided, however, Buyer shall in no event
be released from its obligations hereunder by reason of such assignment
22 ]BROKERAGE COMMISSIONS Buyer represents to City that there has been no
broker, real estate agent, finder or similar entity engaged in connection with this Agreement or the
sale of the Property from the City to Buyer, if consummated as contemplated hereby Buyer agrees
that should any claim be made for brokerage commissions or finder's fees by any broker, agent,
finder or similar entity, by, through or on account of any acts of Buyer or its agent, employees or
representatives, Buyer will indemnify, defend and hold City free and harmless from and against any
and all loss, liability, cost, damage and expense (including attorneys' fees and court costs) in
connection therewith Buyer agrees to pay, at its sole cost and expense, when due, any and all
brokerage commissions incurred by Buyer heretofore or hereafter incurred prior to close of escrow
23 MISCELLANEOUS
231 Captions Any captions to, or headings of the paragraphs or subparagraphs
of this Agreement are solely for the convenience of the parties hereto, are not a part of this
Agreement, and shall not be used for the interpretation or determination of the validity of this
Agreement or any provision hereof
23 2 No Obligations to Third Panties Except as otherwise expressly provided
herein, the execution and delivery of this Agreement shall not be deemed to confer any rights upon,
nor obligate any of the parties hereto,to any person or entity other than the parties hereto
233 Exhibits and Schedules The Exhibits and Schedules attached hereto are
hereby incorporated herein by this reference
07 962 005/47455 Page 10 of 11
23 4 Waiver The waiver or failure to enforce any provision of tlus Agreement
shall not operate as a waiver of any future breach of any such provision or any other provision
hereof
23 5 Fees and Other Expenses Except as otherwise provided herein, each of the
parties shall pay its own fees and expenses in connection with this Agreement
IN WITNESS WHEREOF,the parties hereto have caused this Agreement to be executed by
and through their authorized offices the day,month and year first above written
GUSTAFSON PAR S,LLC CITY OF HUNTINGTON BEACH, a
„ ---� municipal corporation of the State of California
By
t
print name
ITS (circle one)Chairman/resident/Vice President/ May
Membe /Managers
AND
By
�---" City Clerk �-
print name IN ATED AND PROVED
ITS (circle one)Secretary/Chief Financial Officer/Asst 4LP�'
Secretary—Treasurer/Member/Manager
Director of Economic Development
REVIE D APPROVED APPROVED AS TO FORM
i Administrator ity Attorney
jZvto
07 962 005/47455 Page 11 of 11
EXHIBIT "A"
LEGAL DESCRIPTION
THAT PORTION OF LOT 22 BLOCK B OF THE GARFIELD ADDITION TO HUNTINGTON BEACH IN THE
CITY OF HUNTINGTON BEACH COUNTY OF ORANGE STATE OF CALIFORNIA AS SHOWN ON A MAP
RECORDED IN BOOK 7 PAGES 27 AND 28 OF MISCELLANEOUS MAPS IN THE OFFICE OF THE COUNTY
RECORDER OF SAID COUNTY MORE DESCRIBED AS FOLLOWS
BEGINNING AT THE SOUTHWEST CORNER OF SAID LOT 22 THENCE ALONG THE WESTERLY LINE OF SAID
OF SAID LOT 22 N19 18 29 E 74 37 FEET TO THE SOUTHEASTERLY CORNER OF THE FINAL ORDER
OF CONDEMNATION RECORDED AUGUST 13 1999 AS INSTRUMENT NO 99-592245 OF OFFICIAL
RECORDS SAID CORNER IS ALSO ON A NONTANGENT CURVE CONCAVE TO NORTHEAST HAVING A
RADIUS OF 370 00 FEET A RADIAL LINE THROUGH SAID CORNER BEARS S39 41 05"W THENCE
SOUTHEASTERLY ALONG SAID CURVE 5608 FEET THROUGH A CENTRAL ANGLE OF 841 00" TO A POINT
A RADIAL BEARING THROUGH SAID POINT BEARS S31 41 05 W THENCE S31 23 28 W 7 1 1 FEET
TO A POINT ON A NONTANGENT CURVE CONCAVE TO THE SOUTHEAST HAVING A RADIUS OF 42 00 FEET
A RADIAL BEARING THROUGH SAID POINT BEARS N2 09 33 E THENCE SOUTHWESTERLY ALONG SAID
CURVE 39 85 FEET THOUGH A CENTRAL ANGLE OF 54 21 56 TO A POINT OF REVERSE CURVATURE
WITH A CURVE CONCAVE TO THE NORTHWEST HAVING A RADIUS OF 40 00 FEET THENCE SOUTHWESTERLY
ALONG SAID CURVE 36 85 FEET THROUGH A CENTRAL ANGLE OF 52 30 08 TO THE POINT OF BEGINNING
CONTAINING AN AREA OF 2073 SQUARE FEET MORE OR LESS
AS SHOWN ON EXIBIT B ATTACHED HERETO AND MADE A PART HEREOF
PREPARED BY
TETRA TECH INC
16241 LACUNA CANYON ROAD STE 200 gaFF ar �
IRVINE CA 92618
(949) 727-7099 �Q4C �tipt1 Hh4
JOSEPH HARTG R C E 29242 \ 3 3r o9/
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EXHIBIT "B"
I GARFIELD AVE
PREPARED BY c�fErz
TETRA TECH INC
6 A 261 A
241 C LAGUNA CANYON ROAD STE 200
(949) 727-7099 m
29242
k r RENEW 1,
JOSEPH HAR GE RC C242 J CIVIC �P
2 ExPyrFpF LM 1c j
TABLE OF DIMENSIONS
1�— N 19 18 29"E 74 37
ac (`22 Q = 8 41 00 R=370 L=56 08
3 S31 23 28 W 7 11
Q = 54 21 56 R=42 L=39 85
G
Q = 52 30 08" R=40 L=36 65
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