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Home My WebLink AboutGilroy Gardens - Escrow Instructions BERLINER COHEN ATTORNEYS AT LAW SANFORD A. BERLINER. ANDREW L. FABER RALPH J. SWANSON PEGGY L. SPRlNGGA Y JOSEPH E. DWORAK SAMUEL L. F ARB ALAN J. PINNER FRANK R. UBHAUS LINDA A. CALLON JAMES P. CASHMAN STEVEN J. CASAD NANCY J. JOHNSON JEROLD A REITON ROBERT L. CHORTEK JONATHAN D. WOLF KATHLEEN K. SIPLE KEVTN F. KELLEY MARK MAlUEWICZ ROBERTA S. HAYASHI JEFFREY S. KAUFMAN JOLlE HOUSTON BRlAN L. SHETLER JOHN F. DOMINGUE HARRY A. LOPEZ CHARLES W. VOLPE MICHAEL VIOLANTI A PARTNERSHIP INCLUDING PROFES SIONAL CORPORATIONS www.berlineLcom THOMAS P. MURPHY H. ANN LfROFF YlCTOR A. PAPPALARDO CHRISTIAN E. PICONE THOMAS D. MORELL SETH 1. COHEN CHRISTINE H LONG BRADLEY G. HEBERT THOMAS E. EBERSOLE MILES J. DOLINGER LAURA PALAZZOLO SHANNON N. COGAN AARON M. VALENTI KARA L ERDODI ANDREW 1. GIORGIANNI HEATHER H. MUNOZ FORREST W. HANSEN MATTHEW A. TAYLOR MELINDA B. BARKER SANDRA G. SEPln. VEDA MARCO M. CAMPAGNA ERlC 1. BERQUIST DEBBIE Y. BAE MARY KATHARlNE WILSON NICHOLAS RABY STEPHANIE WERSEL TEN ALMADEN BOULEVARD ELEVENTH FLOOR SAN JOSE, CALIFORNIA 95113-2233 TELEPHONE: (408) 286-5800 FACSIMILE: (408) 998-5388 . ^ Professional Corporation IN ASSOCIATION WITH MCGRANE GREENFIELD LLP SAN JOSE' SAN FRANCISCO OF COUNSEL HUGH L. ISOLA STEVEN L. HALLGRlMSON ERJC WONG LINDA 1. LEZOTTE PHILIP GOLDEN NANCY L. BRANDT DAN W. COOPERJDER RETIRED SAMUEL J COHEN ROBERT W. HUMPHREYS Branch OffICe - Merced, CA February 27, 2008 Chicago Title Company ("Escrow Holder") 8060 Santa Teresa Boulevard, Suite 100 Gilroy, CA 95020 Attn: Ms. Jan Wallace Re: Escrow No. 07-98702516-A-KV ("Escrow") Our File No.: 04706- I 18 Dear Jan: This letter constitutes the escrow instructions ("Escrow Instructions") of the City of Gilroy, a charter city and municipal corporation organized under the Constitution and laws of the State of California ("Buyer"), in connection with the purchase from Gilroy Gardens Family Theme Park, Inc., a Delaware nonprofit corporation formerly known as "Bonfante Gardens, Inc." ("Seller"), of that certain real property, located in the City of Gilroy, County of Santa Clara, State of California, together with all easements and appurtenances thereto (the "Property"), more particularly described in that certain Purchase and Sale Agreement and Escrow Instructions dated January 22, 2008, as amended, by and between Seller and Buyer (the "Purchase Agreement"). This letter is intended to substitute for and replace my letter of February 26, 2008. All references to attached exhibits shall be to those exhibits sent you with that letter and received by you today. The Property is encumbered by that certain Deed of Trust, Security Agreement and Fixture Filing with Assignment of Rents and Leases made as of December I, 2000 (the "Senior Bond Deed of Trust"), being recorded on January 11,2001 as Instrument No. 15523372, in the Official Records of the County of Santa Clara, State of California, securing those certain City of Gilroy Senior Lien Project Revenue Bonds (Bonfante Gardens Theme Park Project), Series 2000, issued in the initial principal amount of $27,920,000.00 (the "Senior Lien Bonds"). ~r30Y ~/Sa217#f..!t ITMORELL\7538942 022708-D4706118 Ms. Jan Wallace February 27, 200 The purchase price for the Property is approximately Fourteen Million and 00/1 00 Dollars ($14,000,000.00) (the "Purchase Price"). [The exact purchase price for the Property (the "Purchase Price") shall be an amount equal to a sum which is sufficient to (i) cause the defeasance of all Senior Lien Bonds outstanding as of November I, 2007, excluding Senior Lien Bonds (if any) which have been purchased by the City and tendered to the Bond Trustee for retirement, as required to enable the execution, delivery and recordation of a Deed of Reconveyance of the Senior Bond Deed of Trust; and (ii) pay all costs and expenses incurred to effectuate the defeasance of the Senior Lien Bonds, including without limitation all escrow and other fees and costs charged by the Bond Trustee, bond counsel, verification agent and financial advisor. ] The defeasance itself shall occur outside of your escrow. For purposes of these Escrow Instructions, the "Close of Escrow" or "Escrow Closing" shall be deemed the date upon which the Grant Deed referred to below is recorded with the county recorder ("County Recorder") in the Official Records of Santa Clara County, California ("Official Records"), by Escrow Holder. The above-referenced Escrow is scheduled to close on or before March 3, 2008. ESCROW HOLDER WILL RECEIVE PRIOR TO CLOSING: I. From Seller for recordation at Escrow Closing, a duly executed and acknowledged Grant Deed in the form attached hereto as Exhibit A (the "Grant Deed"). II. From Seller for delivery to Buyer at Escrow Closing, two (2) duly executed counterpart originals of a Lease Agreement in the form attached hereto as Exhibit B (the "Lease"). III. From Seller for delivery to Buyer at Escrow Closing, a duly executed counterpart original of a Memorandum of Lease in the form attached hereto as Exhibit C (the "Memorandum of Lease") IV. From Seller for delivery to Buyer at Escrow Closing, two (2) duly executed counterpart originals of an Assigrunent of Intangible Property in the form attached hereto as Exhibit D (the "Assignment"). V. From Seller for delivery to Buyer at Escrow Closing, two (2) duly executed counterpart originals of a Bill of Sale in the form attached hereto as Exhibit E (the "Bill of Sale"). VI. From Seller for delivery to Buyer at Escrow Closing, a duly executed original of a Non-Foreign Investor Affidavit ("Nonforeign Affidavit"). VII. From Seller for delivery to Buyer at Escrow Closing, a duly executed original of a California Withholding Exemption Certificate (Form 593-C or its equivalent) ("California Form 593-C"). \TMORELL\753894.2 -2- 022708-04706118 Ms. J an Wallace February 27,200 VIII. From Seller for delivery to Buyer at Escrow Closing, a duly executed original of the Amended Bylaws of Gilroy Gardens Family Theme Park, Inc., (a Delaware Nonprofit Public Benefit Corporation), in the form transmitted to you by me as a e-mail attachment concurrently with this letter. IX. From Buyer for delivery to Seller at Escrow Closing, two (2) duly executed counterpart originals of the Lease. X. From Buyer for delivery to Seller at Escrow Closing, a duly executed counterpart original of the Memorandum of Lease. XI. From Buyer for delivery to Seller at Escrow Closing, two (2) duly executed counterpart originals of the Assignment. XII. From Buyer for delivery to Seller at Escrow Closing, two (2) duly executed counterpart originals of the Bill of Sale. XIII. From U.S. Bank National Association, a national banking association organized and existing under the laws of the United States of America, acting as trustee for the 2000 Bonds hereinafter referred to and as escrow bank hereunder with respect to the City of Gilroy Senior Lien Project Revenue Bonds (Bonfante Gardens Theme Park Project), Series 2000 ("Bond Trustee"), a duly executed original Reconveyance of Deed of Trust, or satisfactory instructions to Chicago Title Company to execute and record, as trustee thereunder, a full reconveyance of the Senior Bond Deed of Trust ("Reconveyance"). XIV. From the Bond Trustee referred to above, immediately available funds in the amounts identified in the estimated closing statement to be approved by Buyer. WHEN, AND ONLY WHEN: A. Escrow Holder holds for delivery to the appropriate parties the cash sums and documents described above. B. Chicago Title Company is prepared to issue to Buyer a CL T A binder and agreement to issue ("Binder"), as of the date of the Close of Escrow, its CL T A Owner's Policy of Title Insurance, with endorsements 100 (Comprehensive), 101.4 (Mechanics Liens), 103.7 (Property abuts public street), and 116.7 (Subdivision Map Act compliance) ("Buyer's Title Policy"), in the amount of Thirteen Million Five Hundred Thousand and 00/100 Dollars ($13,500,000.00) insuring fee title vested in Buyer subject only to the title exceptions identified on Schedule B of Chicago Title Company's Preliminary Report for the Property, bearing Escrow Number 07-98702516-A-KV, and dated January 16,2008, at 7:30 a.m. (the "Preliminary Report"), exclusive of exceptions 40,41,57, and 75, which shall be omitted from Buyer's Title Policy. ITMORELLI753894.2 -3- 022708-D4706118 Ms. Jan Wallace February 27, 200 C. Escrow Holder has prepared and Anna Jatczak on behalf of Buyer has approved in writing an estimated closing statement for this transaction. D. Escrow Holder has signed and returned a copy of this letter to Thomas D. Morell acknowledging its acceptance of these Escrow Instructions. E. Escrow Holder is prepared to comply with these Escrow Instructions. THEN AND ONLY THEN ESCROW HOLDER IS INSTRUCTED TO ]MMED~;ELY: ~Ml I. Complete the date on any document undated with the date oj{ yeros.e~. ~ ITMORELL 17538942 022708-D4706118 2. Record the Reconveyance in the Official Records. Record the Grant Deed in the Official Records. 1 ~ y f~ ~ Charge to Buyer the recording charges associated with the recordation of the Grant Deed. 3. 4. 5. Charge to Buyer any County of Santa Clara documentary transfer taxes incurred in connection with this transaction. 6. Charge the Escrow fees to Buyer. 7. Charge to Buyer the premium for the Binder and Buyer's Title Policy, and the cost of any associated title endorsements. 8. All other customary closing costs incurred in connection with the Close of Escrow described herein shall be borne by Buyer. 9. Real property taxes and assessments relating to the Property shall not be prorated. Seller shall remain liable for any real property taxes pursuant to the Lease. 10. Disburse to Seller the balance of the Purchase Price owing to Seller. 11. Deliver to Buyer: (i) endorsed copies of the recorded Grant Deed, the Reconveyance, and the Memorandum of Lease, (ii) a fully executed original of the the Lease, (iii) a fully executed original of the Bill of Sale, (iv) a fully executed original of the Assignment, (v) a fully executed copy of the Bylaws, (vi) an original of the Nonforeign Affidavit and the California Form 593-C signed by Seller, (vii) a closing statement evidencing the consummation of the transaction described herein, (viii) the original Binder committing Chicago Title Company to issue Buyer's Title Policy, and (ix) any excess funds paid by or on behalf of Buyer into Escrow. 12. Deliver to Berliner Cohen at Ten Almaden Blvd., Eleventh Floor, San Jose, California 95113, Attn: Thomas D. Morell, copies of all documents delivered to -4- Ms. Jan Wallace February 27, 200 Buyer, including a copy of Buyer's Title Policy, and copies of all documents delivered into this Escrow by Seller. MISCELLANEOUS PROVISIONS OF ESCROW: (a) The foregoing instruments are delivered to Chicago Title Company as Escrow Holder subject to compliance with the instructions herein set forth. Acceptance by Escrow Holder of this Escrow shall constitute a contractual obligation by Chicago Title Company for complete compliance with these Escrow Instructions and for disposition of the cash sums in accordance herewith. (b) This letter contains the entire agreement between Chicago Title Company and Buyer wjth respect to the subject matter hereof and may not be modified in any manner whatsoever except by written amendment signed by Anna Jatczak of Buyer or Thomas D. Morell on behalf of Buyer. (c) Time is of the essence. If Escrow Closing does not occur on or before March 3, 2008, then Escrow Holder is instructed to hold all funds and documents delivered to it pursuant to these instructions pending further instructions from Buyer or Buyer's counsel on behalf of Buyer. (d) Notwithstanding your failure to return the executed copy of this letter as called for in these Escrow Instructions, Escrow Holder's act of recording the Grant Deed shall constitute evidence of its agreement to comply with the foregoing Escrow Instructions. Very truly yours, BERLINER COHEN .~~ THOMAS D. MORELL E-Mail: thomas. morelJ@berlineLcom TDM Enclosures cc: Anna Jatczak Andrew L. Faber, Esq. ITMORELLI753894.2 022708-D4706118 -5- Ms. Jan Wallace February 27,200 The undersigned hereby acknowledges receipt of the foregoing instructions and agrees to comply with the foregoing instructions in accordance with the terms and conditions contained herein. ITMORELLI7538942 022708-D4706118 -6- Page 1 of2 Wallace, Jan From: Morell,Thomas [Thomas.Morell@berliner.com] Sent: Friday, February 29, 200810:13 AM To: Wallace, Jan Cc: Faber, Andy L Subject: FW: Spam: Gilroy Gardens Jan: The Purchase Price is $13,247,484.76. I am satisfied having the title policy in that amount. Thanks, Tom. Thomas D. Morell Berliner Cohen 10 Almaden Boulevard, 11th Floor San Jose, California 95113 ph: (408) 286-5800 fax: (408) 998-5388 thom as. morell@berliner.com From: G. Craig Hill [mailto:craig@nhainc.net] Sent: Friday, February 29, 2008 10:06 AM To: Morell,Thomas Subject: RE: Spam: Gilroy Gardens Not including the real estate expenses, the financial cost is as follows $13,247,484.76. G. Craig Hill INorthcrosslHiIllAch I Fillancial Advisors to Public Agencies 999 Fifth Avenue, Suite 560 San Rat~lel, CA 94901 415.506.3400 415.506.3401 fax Q.r~jg@ n hai 11_Q.~Dy.t -"",~_w.Jlh ajD(;~ net From: Morell, Thomas [mailto :Thomas. Morell@berliner.com] Sent: Friday, February 29, 2008 10:04 AM To: Wallace, Jan Cc: G. Craig Hill Subject: RE: Spam: Gilroy Gardens Yes. The legal is approved. I will get back to you shortly on the Purchase Price. Thomas D. Morell Berliner Cohen 10 Almaden Boulevard, 11 th Floor San Jose, California 95113 ph: (408) 286-5800 2/29/2008 Page 2 of2 fax: (408) 998-5388 lhoJnC3~,m9JE::II@R_E::[ljnE::L~9_m From: Wallace, Jan [mailto:WallaceJa@CTT.com] Sent: Friday, February 29, 2008 9:32 AM To: Morell,Thomas Subject: Spam: Gilroy Gardens I need your permission for the new legal to be used in this escrow; I also would appreciate you emailing an amount of the sale because I am not going to take the responsibility to establish same. Also need amount for title insurance, which does not have to be the exact same as the purchase price. Jan Wallace, Branch Manager Chicago Title Company 8060 Santa Teresa Blvd. #100 Gilroy, CA 95020 Phone(408)84~8211 Fax (408) 842-4317 mailto: wallaceja@ctt.com In an ever-changing market, we want to remind you we are a strong Fortune 500 Company. We are celebrating 160 years of protecting homes and businesses across the United States. Chicago Title Company is a "self- insured" Nationwide Company, with combined reserves of over 1.2 Billion dollars for claims under the FNF corporate umbrella. Our local operation has been in Gilroy since the 1950's, and is here to stay to assist you. 2/29/2008 Page 1 of I Wallace, Jan From: Morell,Thomas [Thomas.Morell@berliner.com] Sent: Wednesday, February 27, 20085:25 PM To: Wallace, Jan Subject: RE: Spam: Gardens Yes. Thomas D. Morell Berliner Cohen 10 Almaden Boulevard, 11 th Floor San Jose, California 95113 ph: (408) 286-5800 fax: (408) 998-5388 thQm~:L~JDQr~J1@I:>~IliD~LgQm From: Wallace, Jan [mailto:WallaceJa@CTT.com] Sent: Wednesday, February 27, 2008 5:24 PM To: Morell,Thomas Subject: Spam: Gardens Do you want the Memo of Lease recorded concurrently with Grant Deed? Jan Wallace, Branch Manager Chicago Title Company 8060 Santa Teresa Blvd. #100 Gilroy, CA 95020 Phone (408) 842-8211 Fax (408) 842-4317 mailto: wallaceja@ctt.com In an ever-changing market, we want to remind you we are a strong Fortune 500 Company. We are celebrating 160 years of protecting homes and businesses across the United States. Chicago Title Company is a "self- insured" Nationwide Company, with combined reserves of over 1.2 Billion dollars for claims under the FNF corporate umbrella. Our local operation has been in Gilroy since the 1950's, and is here to stay to assist you. 2/27/2008 Page 1 of 1 Wallace,Jan From: Morell, Thomas [Thomas.Morell@berliner.com] Sent: Wednesday, February 27,20085:27 PM To: Wallace, Jan Subject: RE: Spam: ok Thomas D. Morell Berliner Cohen 10 Almaden Boulevard, 11 th Floor San Jose, California 95113 ph: (408) 286-5800 fax: (408) 998-5388 !I]Q rn as ~moL~l1@_beclirl~Ly.Qm From: Wallace, Jan [mailto:WallaceJa@CTT.com] Sent: Wednesday, February 27, 2008 5:26 PM To: Morell,Thomas Subject: Spam: I will have Anna sign current estimate, and we can amend and fax before closing. At one time I thought that the City wanted to add additional costs to be paid in escrow. Jan Wallace, Branch Manager Chicago Title Company 8060 Santa Teresa Blvd. #100 Gilroy, CA 95020 Phone(408)84~8211 Fax (408)8424317 mailto: wallaceja@ctt.com In an ever-changing market, we want to remind you we are a strong Fortune 500 Company. We are celebrating 160 years of protecting homes and businesses across the United States. Chicago Title Company is a "self- insured" Nationwide Company, with combined reserves of over 1.2 Billion dollars for claims under the FNF corporate umbrella. Our local operation has been in Gilroy since the 1950's, and is here to stay to assist you. 2/27/2008 C~) Chicago Title Company 8060 Santa Teresa Blvd., Suite 100, Gilroy, CA 95020 408842-8211 . FAX 408 842-4317 ATTN: Ms. Anna Jatczak Interim City Administrator 7351 Rosanna Street Gilroy, California 95020 DATE: March 3, 2008 ESCROW NO.: 07-98702516-JW LOCATE NO.: CACTI7743-7743-2987-0098702516 TITLE NO.: 07-98702516-KV PROPERTY ADDRESS: Hecker Pass Highway, Gilroy, CA 95020 Dear Anna, Please find enclosed the following pursuant to your letter of instructions: 1.) First Amendemnt to Purchase and Sale Agreement 2.) Bill of Sale 3.) Assignment of Intangible Property 4.) Single Tenant Lease 5.) Copy of letter of instruction from Thomas Morrell 6.) copy of 1099 8.) endorsement copies of documents that recorded Feb. 29, 2008 9.) final closing statements Sincerely, enclosure( s) Blank Letter (letter)(06-06) ~~rf~ & b ~A ~ ROPES & GRAY LLP ONE INTERNATIONAL PLACE BOSTON. MA 02110-2624 617-951-7000 F 617-951-7050 BOSTON NEW YORK PALO ALTO SAN FRANCISCO TOKYO WASHINGTON. DC www.ropesgray.com February 1, 2008 Lawrence D. Bragg, III 617-951-7427 lawrence. bragg@ropesgray.com BY FEDERAL EXPRESS Ms. Anna Jatczak Interim City Administrator 7351 Rosanna Street Gilroy, California 95020-6197 Re: Gilroy Gardens Family Theme Park Dear Ms. J atczak: Enclosed are eight execution copies of the Bond Purchase and Sale Agreement, each signed by the Putnam funds. Please sign all eight, keep two for your records, return five to me and send the eighth copy to Chick Adams at Jones Hall, 650 California Street, 18th Floor, San Francisco, California 94108. Thank you. Very truly yours, t. ~ ~~\ <- Lawrence D. Bragg, III LDB:svj Enclosures cc: Stephen P. O'Connell G. Craig Hill Charles F. Adams 10897006_l.DOC