Preview
1 Timothy M. Flaherty, SBN 99666
Christian P. Foote, SBN 240919
2 CLARK HILL LLP
ELECTRONICALLY
505 Montgomery Street, 13th Floor
3 San Francisco, CA 94111 F I L E D
Superior Court of California,
Telephone: (415) 984-8500 County of San Francisco
4 Facsimile: (415) 984-8599
TFlaherty@clarkhill.com 12/08/2021
5 CFoote@clarkhill.com Clerk of the Court
BY: YOLANDA TABO-RAMIREZ
Deputy Clerk
6 Attorneys for Defendant/Cross-Complainant
ALICE PHELAN SULLIVAN CORPORATION
7
8 SUPERIOR COURT OF THE STATE OF CALIFORNIA
9 CITY AND COUNTY OF SAN FRANCISCO
10
11 WHITE HOUSE VENTURES, LLC, a Case No. CGC-20-582659
California limited liability company,
12 SUPPLEMENTAL DECLARATION OF
Plaintiff, TIMOTHY M. FLAHERTY IN SUPPORT OF
13 ALICE PHELAN SULLIVAN
v. CORPORATION’S OPPOSITION TO WHV’S
14 MOTION TO ENFORCE TERMINATION OF
ALICE PHELAN SULLIVAN SETTLEMENT, OR IN THE ALTERNATIVE,
15 CORPORATION, a California corporation; and DEEM SETTLEMENT AGREEMENT
DOES 1-100, UNENFORCEABLE
16
Defendants.
17 Complaint filed: February 3, 2020
________________________________________
18 Cross-Complaint Filed: May 29, 2020
ALICE PHELAN SULLIVAN
19 CORPORATION, a California corporation,
20 Cross-Complainant,
21 v.
22 WHITE HOUSE VENTURES, LLC, a
California limited liability company, and ROES
23 1-10,
24 Cross-Defendants.
25
I, Timothy M. Flaherty, declare:
26
1. I am an attorney duly licensed to practice law before all Courts in the State
27
of California and am a member with the law firm of Clark Hill LLP, attorneys of record for
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Suppl. Flaherty Decl.
31 CLARKHILL\62578\372310\262704903.v1-4/14/21
1 Defendant/Cross-Complainant ALICE PHELAN SULLIVAN CORPORATION (“APS”) in
2 this action. If called upon, I would competently testify to the following based upon my own
3 personal knowledge.
4 2. At the time that the parties executed the Stipulation for Settlement, I had a
5 conversation with WHV’s counsel, Greg Cavallo, about how to go about drafting the
6 purchase and sale agreement (PSA) mandated by the settlement. I suggested that we use one
7 of the prior PSA documents from WHV’s prior transactions from 2017 and 2019. Mr.
8 Cavallo agreed. I then asked Mr. Cavallo if he had a preference for which document was
9 used as a template (i.e., the Interpark contract from 2017 or the JMA contract from 2019),
10 and he said that he did not have a preference and told me to choose.
11 3. APS’s draft PSA that was sent to WHV on November 8, 2021, was based on
12 the template of the 2019 JMA contract that WHV had previously agreed to.
13 4. Attached hereto as Exhibit A is a true and correct copy of the final version
14 of the 2017 Interpark PSA. This document was fully approved by the lawyers at the time for
15 WHV, as reflected in the cover email forwarding the contract. The documents attached
16 collectively as Exhibit A were produced by WHV in this litigation and were identified as
17 Exhibit 6 to the Deposition of George Karas that I took in this action and were authenticated
18 by Mr. Karas in that deposition.
19 5. The Interpark contract bore a close resemblance to the 2019 JMA contract,
20 which was also approved by WHV’s lawyers at the time. Attached hereto as Exhibit B is a
21 true and correct copy of the purchase and sale agreement for the White House garage
22 leasehold between WHV and JMA in 2019, along with its cover email. These documents
23 were produced by WHV in this litigation and identified collectively as Exhibit 37 to the
24 Deposition of George Karas that I took in this action and authenticated by Mr. Karas in that
25 deposition.
26 6. Based on my review of these two contracts, most if not all the terms of
27 APS’s draft purchase and sale agreement, including the terms objected to by WHV, are
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30 Suppl. Flaherty Decl.
31 CLARKHILL\62578\372310\262704903.v1-4/14/21
1 standard terms included in both the Interpark and JMA contract and important pro forma
2 provisions for the type of transaction contemplated by the Stipulation for Settlement.
3
4 I declare under penalty of perjury under the laws of the State of California that
5 the foregoing is true and correct.
6
Dated: December 8, 2021
7 By: /s/ Timothy M. Flaherty
Timothy M. Flaherty
8 Attorneys for Defendant/Cross-Complainant
ALICE PHELAN SULLIVAN
9 CORPORATION
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30 Suppl. Flaherty Decl.
31 CLARKHILL\62578\372310\262704903.v1-4/14/21
SUPPLEMENTAL FLAHERTY DECL. EX. A
From: gkaras711@aol.com
Sent: Tuesday, October 11, 2016 12:19 PM
To: andy.mclaughlin@intpark.com
Subject: Fwd: White House Garage
Attachments: DOCSS F1-#497820-v2- Pu rchase_and_Sale_Ag reement.DOC; DOCSS F1-#497820-vpdf-
Purchase_and_Sale_Agreement.PDF; DOCSSF1-#496419-v2-
Consent_Estoppel_and_Ag reement.DOC; DOCSS F1-#496419-vpdf-
Consent_Estoppel_and_Agreement.PDF
Hi Andy, Here is the email from our attorney. Thanks, George
-----Original Message-----
From: Davia M. Love
To: gkaras711
Cc: Russell D. Pollock ; Thomas L. Prestwich
Sent: Tue, Oct 11, 2016 11 :37 am
Subject: White House Garage
George, per our conversations this morning, attached are clean and redlined versions of both the Purchase
and Sale Agreement and the Consent and Estoppel. These are both in a form that may be forwarded to the
Purchaser.
Let me know if you have any questions.
Davia M. love I Greene Radovsky Maloney Share & Hennigh LLP I Four Embarcadero Center, 40th Floor I San Francisco, CA 94111 I
tel: 415.981.1400 I fax: 415.777.4961 I direct tel: 415.248.1538 I email: dlove@greeneradovsky.com I web:
www.greeneradovsky.com
CONFIDENTIAL WHV07810
GRMSH Draft 10/11/16
PURCHASE AND SALE AGREEMENT
(LEASE)
by and between
WHITE HOUSE VENTURES, LLC, a California limited liability company
as Seller
and
[URBAN GROWTH PROPERTY ENTITY], a _ _ __
as Purchaser
Dated - - - - -, 2016
The White House Garage, 223 Sutter Street, San Francisco, California
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CONFIDENTIAL WHV07811
GRMSH Draft 10/11/16
PURCHASEANDSALEAGREEMENT
THIS AGREEMENT (this "Agreement") dated , 2016 (the "Effective Date")
by and between WHITE HOUSE VENTURES, LLC, a California limited liability company
("Seller") and [URBAN GROWTH PROPERTY ENTITYJ, a ("Purchaser").
FIRST AMERICAN TITLE INSURANCE COMPANY, a Missouri corporation ("Escrow
Agent" or "Title Company") is a party to this Agreement for the limited purposes set forth
herein.
WITNESSETH:
WHEREAS, pursuant to that certain Air Commercial Real Estate Association Standard
Industrial/Commercial Single-Tenant Lease- Net, dated as of June 21, 2013, amended by that
certain First Amendment to Lease dated June 20, 2016 (as amended, the "Lease") by and
between Alice Phelan Sullivan Corporation, a California corporation ("Landlord") and Seller,
Seller owns a leasehold interest in the Property (as defined below); and
WHEREAS, Seller desires to sell to Purchaser, and Purchaser desires to purchase from
Seller, its leasehold interest in the Property under the terms of this Agreement;
NOW, THEREFORE, in consideration of the mutual covenants and other good and
valuable consideration, the receipt and sufficiency of which are acknowledged, the parties agree
as follows:
Article 1
Purchase and Sale
1.1 Agreement of Purchase and Sale. Subject to the terms and conditions of this
Agreement, Seller will sell and Purchaser will purchase the following:
a. Premises. The leasehold interest in that certain real property, including all
improvements therein or to be provided by Landlord under the terms of the Lease
and commonly known as The White House Garage, 223 Sutter Street, San
Francisco, located in San Francisco County, California, as described more
particularly on Exhibit A (the "Premises");
b. Easements and Appurtenances. Seller's interest in the rights, easements
and appurtenances pertaining to the Premises including Seller's interest (if any) to
any adjacent streets, alleys or rights-of way, or any easements that benefit or
burden the Premises (the "Related Rights"); and
c. Improvements. Seller's interest, if any, in all buildings, structures,
fixtures or other improvements on the Premises, including all parking spaces and
garage operations, storage rooms, and parking control equipment located within
the Premises as of the date of this Agreement (the "Improvements");
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CONFIDENTIAL WHV07812
d. Tangible Personal Property. Seller's interest in and to all tangible
personal property listed on Exhibit B (the "Tangible Personal Property");
e. Intangibles. All ofthe following (collectively, the "Intangibles"):
(i) Agreements. All agreements benefiting Seller for the Premises,
including all service contracts, agreements relating to any customer
parking and agreements for Premises-specific advertising or signage
listed on Schedule 1.1(e)(i) (the agreements, other than the Sub-
leases, are the "Agreements"), to the extent not terminated pursuant
to the terms of this Agreement;
(ii) Warranties and Guaranties. All assignable Premises warranties and
guaranties;
(iii) Leases. All sub-leases, parking agreements and occupancy
agreements affecting the Premises, if any (the "Sub-leases")
including allmonthly parking contracts and longer term parking and
valet contracts but excluding claims against the landlord under any
such Lease or the Premises based on events or circumstances that
occurred prior to closing; and
(iv) Permits. All assignable permits, licenses, approvals, certificates of
occupancy and authorizations issued for the Property or its
operations (collectively, the "Permits"), including, without
limitation, the items listed on Schedule 1.1(e)(v).
1.2 Property Defined. The Premises, the Related Rights, the Improvements, the
Tangible Personal Property, and the Intangibles are hereinafter referred to as the "Property".
Article 2
Purchase Price And Earnest Money
2.1 Purchase Price. The purchase price ("Purchase Price") for the Property is
Sixteen Million Five Hundred Thousand and no/100 Dollars ($16,500,000.00) payable by wire
transfer of immediately available funds, against which the Earnest Money (as defined below) and
any net credit or proration will be debited or credited accordingly.
2.2 Earnest Money. Within three (3) business days of the Effective Date, Purchaser
will deposit Five Hundred Thousand and no/100 Dollars ($500,000) (together with all interest
earned, the "Earnest Money") in escrow with First American Title Insurance Company (the
"Escrow Agent"). Seller and Purchaser agree that the Earnest Money shall be applied towards
payment of the Purchase Price. The Escrow Agent shall handle the Earnest Money strictly in
accordance with Article 9 of this Agreement.
2.3 Independent Consideration. If Purchaser is entitled to a return of the Earnest
Money pursuant to the terms of this Agreement, One Hundred Dollars ($100.00) (the
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CONFIDENTIAL WHV07813
"Independent Consideration") of the Earnest Money shall be paid to Seller as good and
sufficient independent consideration for entering into this Agreement. In addition, Seller
acknowledges that Purchaser, in performing its due diligence investigation of the Property, will
incur expenses, and that Purchaser's expenses also constitute good, valuable and sufficient
consideration for this Agreement.
Article 3
Monetary Liens
3 .1 Curable Title Matters. Seller shall be obligated at Closing to discharge, at Seller's
cost and expense, (i) any mortgage liens or mechanic's and materialman's liens against Seller's
leasehold estate in the Premises or otherwise encumbering the Property created by or through
Seller, and (ii) any consensual liens or encumbrances agreed to by Seller without Purchaser's
consent on or after the Effective Date (collectively, the "Curable Matters"). Purchaser shall
take title to the Property subject to all other title exceptions to which Purchaser does not object in
writing at least five ( 5)days prior to the end of the Inspection Period. If Purchaser does timely
raise an objection to any title exception(s), Seller shall have five (5) days from receipt of
Purchaser's written objection notice, within which to agree to cure the subject exception or
refuse to cure the subject objection (and except for Curable Matters, Seller shall have no
obligation to cure any objection(s) to title). If Seller fails to respond within such 5-day period,
Seller will be deemed to have elected not to cure the subject objection. If Seller refuses within
such 5-day period to cure any objection to which Purchaser timely objected (or if Seller is
deemed to have so elected), Purchaser shall have five (5) days from receipt of Seller's notice of
refusal (or from the end of the 5-day Seller response period, if Seller fails to respond), to either
terminate this Agreement, or continue to Closing. If Purchaser fails to make its election within
such 5-day period, Purchaser shall be deemed to have elected to continue to Closing. Upon
termination of this Agreement pursuant to this Section 3 .1.1, the Earnest Money will be returned
to Purchaser, and Seller and Purchaser shall have no further rights and obligations hereunder
except those which expressly survive termination of this Agreement. All title exceptions other
than Curable Matters and exceptions that Seller agreed to cure following receipt of an objection
from Purchaser shall constitute "Permitted Exceptions".
Article 4
Inspection
4.1 Right of Inspection. Subject to the terms of the Lease, or otherwise with the
approval of Landlord and upon 24 hours' prior notice to Seller, Purchaser may, at Purchaser's
expense, enter the Property and make all due diligence investigations, studies, tests and
samplings which Purchaser desires (the "Inspections"), including, without limitation, non-
invasive geological, environmental, and engineering testings. Seller's approval shall be required
for any invasive testing. Purchaser may access and inspect, and Seller shall furnish, all files,
books and records maintained by Seller or its agents, wherever located, relating to the Property,
including, but not limited to, Sub-leases, service contracts, bills, invoices, correspondence,
surveys, plats and specifications, licenses and warranties, and any other items reasonably
requested by Purchaser. Furthermore, Purchaser may conduct an audit of the Property during the
Inspection Period (as defined in Section 4.2 of this Agreement) and inspect the operating
statements and financial statements which pertain to Seller's operation of the Property. During
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CONFIDENTIAL WHV07814
the Inspections, Purchaser will maintain or will cause its contractors or consultants to maintain
comprehensive public liability and property damage insurance with a limit of $1,000,000 for
each incident and a $2,000,000 policy limit for aggregate operations on an occurrence basis.
Purchaser will indemnify, defend and hold Seller harmless from any claims, demands, losses and
liabilities suffered due to the Inspections,.
4.2 Right of Termination. Unless Purchaser provides written notice to Seller that
Purchaser desires to maintain this Agreement in effect (a "Continuation Notice") on or before
5:00 p.m. Pacific time on the date that is thirty (30) days after the Effective Date (the
"Inspection Date"; the period of time commencing on the Effective Date and ending on the
Inspection Date is known as the "Inspection Period"), this Agreement shall automatically
terminate as of the Inspection Date. Upon such termination, the Earnest Money will be returned
to Purchaser, and Seller and Purchaser shall have no further rights and obligations hereunder
except those which expressly survive termination of this Agreement.
4.3 Termination of Agreements. On or before the Inspection Date, Purchaser shall
notify Seller of those Agreements which Purchaser will not assume at Closing, and Seller must,
at Seller's cost, terminate those Agreements prior to Closing. On or before the Closing, Seller
shall terminate the existing parking management agreement, at Seller's cost.
Article 5
Closing
5.1 Time and Place of Closing. The consummation of the transactions contemplated
by this Agreement (the "Closing") shall be held via escrow through the offices of Escrow Agent
at 1:00 p.m. (local time) on the date that is thirty (30) days after the Inspection Date or such
earlier date as Purchaser and Seller mutually agree upon (the "Closing Date").
5.2 Seller's Closing Obligations. At Closing, Seller will:
a. Assignment and Assumption of Lease. Deliver to Purchaser a duly
executed Assignment and Assumption of Lease in the form attached as Exhibit E
("Assignment").
b. Bill of Sale and Assignment. Deliver to Purchaser two (2) duly
executed counterparts of a bill of sale and assignment and assumption of Sub-
leases, service contracts and permits, in the form attached as Exhibit F (the "Bill
of Sale and Assignment");
c. Evidence of Authority. Deliver to Purchaser such evidence as
Purchaser's counsel and/or the Title Company may reasonably require as to the
authority of the person or persons executing documents on behalf of Seller;
d. FIRPT A Deliver to Purchaser an affidavit duly executed by Seller
stating that Seller is not a "foreign person" as defined in the Federal Foreign
Investment in Real Property Tax Act of 1980 and the 1984 Tax Reform Act;
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CONFIDENTIAL WHV07815
e. Owner's Affidavit. Deliver to the Title Company a titleinsurance
affidavit, if required by the Title Company, duly executed by Seller, in the form
attached hereto as Exhibit
f. Property Items. Deliver to Purchaser all keys, the Sub-leases, the
Agreements that Purchaser has elected to assume, licenses and permits, if any, in
the possession of Seller or Seller's agents, together with such leasing and property
files and records which are material in connection with the continued operation,
leasing and maintenance of the Property;
g. Landlord Consent. Deliver to Purchaser an executed Consent.
h. Escrow Agreement. Escrow $100,000 (the "Escrow") of the
Purchaser Price with the Escrow Agent pursuant to an escrow agreement (the
"Escrow Agreement") reasonably satisfactory to Purchaser, Seller, and Escrow
Agent, pursuant to which Purchaser shall have the right to draw on the Escrow in
connection with Seller's obligations hereunder that survive the Closing, including
without limitation re-proration obligations, breach of representations and
warranties, and indemnities.
i. Settlement Statement. Deliver to Purchaser an executed
counterpart settlement statement (the "Settlement Statement") setting forth the
amounts paid by or on behalf of and/or credited to each of Purchaser and Seller
pursuant to this Agreement;
J. Possession. Deliver to Purchaser possession of the Property; and
k. Other Items. Deliver such additional documents as shall be
reasonably requested by Purchaser or the Title Company or required to
consummate the transactions contemplated by this Agreement.
5.3 Purchaser's Closing Obligations. At Closing, Purchaser shall:
a. Purchase Price. Deliver to Escrow Agent the full amount of the
Purchase Price, as adjusted by prorations and credits in immediately available
federal funds wire transferred to Escrow Agent's bank account;
b. Assignment and Assumption of Lease. Join Seller in execution of
the Assignment;
c. Bill of Sale & Assignment. Join Seller in execution of the Bill of
Sale and Assignment;
d. Evidence of Authority. Deliver to Seller such evidence as Seller's
counsel and/or the Title Company may reasonably require as to the authority of
the person or persons executing documents on behalf of Purchaser;
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CONFIDENTIAL WHV07816
e. Settlement Statement. Join Seller m the execution of the
Settlement Statement;
f. Escrow Agreement. Deliver to Seller and Escrow Agent the
Escrow Agreement; and
g. Other Items. Deliver such additional documents as shall be
reasonably requested by Seller or the Title Company or required to consummate
the transaction contemplated by this Agreement, provided, however, that in no
event shall Purchaser be required to undertake any other material liability not
expressly contemplated in this Agreement, unless Purchaser elects to do so in its
sole discretion.
5.4 Credits and Prorations. All income and expenses in connection with the operation
of the Property shall be apportioned, as of 11:59 p.m. on the day prior to the Closing Date.
Prorated or credited items shall include, without limitation, the following:
5.4.1 Taxes. Personal property taxes, parking taxes and other assessments paid
by Seller under the Lease imposed by any governmental authority and any association
assessments, fees and dues (collectively, the "Taxes") for the then-current calendar year will be
prorated. If the Closing Date occurs prior to the receipt by Seller of all tax bills for the calendar
year, Purchaser and Seller will prorate Taxes for such calendar year based on the previous year
and a post-closing "true-up" shall take place once all tax bills for the calendar year are received.
Purchaser will pay all increases on Taxes due to the change in ownership or use of the Property,
and the same will not be prorated. Seller hereby agrees to indemnify Purchaser for any unpaid
Taxes relating to the Seller's period of ownership, regardless of when first assessed.
5.4.2 Rent (Sub-leases).
a. All rent and other payments made to Seller under the Sub-leases
shall be prorated to the extent actually collected. After Closing Purchaser will
pay to Seller upon receipt all rent applicable to periods prior to Closing; provided
that all rent collected by Purchaser after Closing will be applied first to unpaid
rent accruing after Closing and then to unpaid rent accruing prior to Closing;
b. Purchaser shall receive a credit for all prepaid rents made by any
tenants under the Sub-leases to the extent applicable to the period after Closing
(the "Prepaid Rents"). Seller will retain all such Prepaid Rents at Closing.
5.4.3 Rent (Lease). All Base Rent and other payments made by Seller pursuant
to the Lease shall be prorated. Purchaser will receive a credit at closing for Percentage Rent
accrued under the Lease for the month of Closing relating to Seller's period of ownership based
on revenues collected for such month as of Closing, and Purchaser will assume the obligation to
make all payments ofPercentage Rent due under the Lease. If this amount cannot be determined
at Closing, an estimate based on the prior month will be used at Closing, with the actual amount
trued up within 30 days after Closing. Seller shall provide a calculation and support for the
revenue earned by Seller in the month of Closing.
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5.4.4 Parking Income. All parking revenues and other income (including,
without limitation, any and all income received from the sale of validations or coupons for future
parking use, and rent under any leases) collected with respect to the Property for the Closing
Date and thereafter shall be the property of Purchaser, and Purchaser shall receive a credit at
Closing therefor. The parking revenues and income collected for the Closing Date with respect
to the Property shall be determined by multiplying the number of vehicles parked on such
Property at noon the day before the Closing Date by the average price of the parking ticket for
such day.
5.4.5 Utilities. All utility bills for the Property shall be prorated. In the event
Seller has not received utility bills through the Closing Date, utilities shall be prorated based on
the most recent bills and a post-closing "true-up" shall take place within ninety (90) days of
Closing.
5.4.6 Agreements. All payments required under the Agreements shall be
prorated, provided; however, that Purchaser will not be responsible for any Agreements to be
terminated by Seller pursuant to Section 4.3.
5.4.7 Additional Items. Any other operating expenses or other items pertaining
to the Property which are customarily prorated between a purchaser and a seller in comparable
commercial transactions in the area in which the Property is located.
The terms and provisions of Section 5.4 shall survive the Closing.
5.5 Closing Costs. Seller shall pay (a) the fees of any counsel representing it in
connection with this transaction, (b) one-half (liz) of any escrow fee which may be charged by
Escrow Agent or Title Company, and (c) the costs of removing the Curable Matters. Purchaser
shall pay (d) all transfer taxes, recording taxes, grantor taxes and similar charges relating to the
transfer of the Property, (e) the cost of the Title Commitment and Title Policy, (f) the cost of any
survey of the Property prepared at Purchaser's request, (g) the fees of any counsel representing
Purchaser in connection with this transaction, (h) one-half (liz) of any escrow fees charged by the
Escrow Agent or Title Company, (i) all recordation costs, and G) the cost of Purchaser's
inspections of the Property. Except as otherwise provided in this Agreement, all other costs and
expenses incident to this transaction and the closing thereof shall be paid by the party incurring
such costs.
5.6 Conditions to Closing. Purchaser's obligation to purchase the Property IS
conditioned upon and subject to the occurrence of the following prior to the Closing Date:
a. Seller must have delivered to Purchaser all items required to be
delivered under this Agreement;
b. Seller must have obtained and delivered to Purchaser, no later than
two (2) days before Closing, the Consent, Estoppel and Agreement in the form of
Exhibit C ("Consent") from the Landlord, without material changes and noting
no material defaults.
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c. All representations and warranties of Seller contained in this
Agreement shall be true and correct in all material respects as of the Closing Date.
d. Seller must have performed and observed, in all material respects,
all covenants and agreements of this Agreement to be performed and observed by
Seller as of the Closing Date.
e. The Title Company shall be irrevocably committed to issue a
Leasehold Title Policy of insurance in the amount of the Purchase Price subject
only to the Permitted Exceptions (the "Title Policy").
f. All other conditions precedent to Purchaser's obligation to
purchase the Property which are set forth in this Agreement shall have been
satisfied on or before the Closing Date.
g. No default shall exist under the Lease.
In the event any of the foregoing conditions has not been satisfied by the Closing Date,
Purchaser shall have the right to (i) waive such condition or (ii)terminate this Agreement by
written notice to Seller on the Closing Date, whereupon Escrow Agent shall refund the Earnest
Money to Purchaser and the parties shall have no further rights, duties or obligations under this
Agreement, other than those which expressly survive the termination of this Agreement;
provided, however, that if any of the foregoing conditions has not been satisfied due to a default
by Purchaser or Seller of its respective obligations under this Agreement, then Purchaser's and
Seller's respective rights, remedies and obligation shall be determined in accordance with Article
7.
Article 6
Representations, Warranties and Covenants
6.1 Representations and Warranties of Seller. Seller represents and warrants the
following statements are true on the date of this Agreement and shall be true and correct on the
Closing Date:
6.1.1 Authority. Seller is duly organized and validly exists as a limited liability
company under the laws of the State of California. Seller has the right and authority to enter into
this Agreement and to transfer the Property pursuant to this Agreement. The person signing this
Agreement is authorized to do so. This Agreement has been duly authorized, executed and
delivered by Seller, is a valid and binding obligation of Seller and is enforceable against Seller in
accordance with its terms. Except Landlord's consent to be obtained as a condition to Closing,
Seller has obtained all consents and permissions required under any covenant, agreement,
encumbrance, law or regulation which bind Seller or the Property.
6.1.2 Pending Actions. No action, suit, administrative or judicial proceeding, or
unsatisfied order or judgment (each, a "Pending Action") is pending or threatened which may
adversely a