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HomeMy WebLinkAboutHull (David J. Hull & D&J Investments LLC) 2020-12-15DONATION AGREEMENT AND JOINT ESCROW INSTRUCTIONS This Donation Agreement and Joint Escrow Instructions ("Agreement") is entered in Ukiah, California, on the date last executed below ("Effective Date") by and between David J. Hull and D&,J Investments, LLC, a California limited liability company (collectively "Hull"), on the one hand, and the City of the Ukiah, a general law municipal corporation ("City"), on the other hand. Hull and City are, at times, collectively referred to herein as the "Parties." RECITALS A. Hull owns (or, prior to the close of escrow contemplated in this Agreement, will own) record title to that certain largely undeveloped real property located in the County of Mendocino commonly known as Assessor's Parcel Number 157-060-03, consisting of approximately 128.5+/- acres, as more particularly shown in Exhibit Al, which is attached hereto and incorporated herein by reference ("Donation Property"). B. City desires to acquire the Donation Property for, among other purposes, open space preservation, hiking -trail development, and other compatible recreation resources. C. Hull desires to donate the Donation Property to City in 2020. D. The Parties enter this Agreement to carry out those desires and purposes. TERMS NOW, THEREFORE, in consideration of the Recitals above, which are incorporated into these terms by reference, and subject to the terms and conditions stated herein, the Parties agree as follows. 1. Donation. Hull will donate the Donation Property to City, and City hereby accepts Hull's donation of the Donation Property. The donation will occur by Hull conveying by grant deed all of Hull's right, title and interest in the Donation Property to City ("Deed"). Title shall transfer on the Closing Date, as defined below, in accordance with the terms and conditions of this Agreement. Notwithstanding any contrary provision herein, Hull shall maintain the right to terminate or cancel this Agreement, in Hull's sole discretion, for any reason whatsoever (with or without cause) prior to the Close of Escrow; provided that Hull reimburses City for any costs City 1 Exhibit A is for reference only. It does not serve to establish or represent actual boundary lines of the Donation Property. Donation Agreement & Joint Escrow Instructions Page 1 of 7 incurred prior to such termination for the Report (defined below) and any other Title Company charges (Hull's reimbursement obligation under this section shall not apply to (1) terminations or cancellations jointly desired by the Parties, (2) those resulting from the City's breach of the agreement, (3) those resulting under section 4 of this Agreement or (4) any termination or cancellation of the agreement due to no fault of Hull.). 2. Donation Value. Acknowledgement. Tax Matters. Based on independent appraisal and present market conditions, the Parties agree that the Donation Property maintains a fair market value of approximately $1,366,912. The Parties acknowledge and agree that no goods or services were provided to Hull in exchange for the donation of the Donation Property. City acknowledges it has no intent to sell the Donation Property within three (3) years of the Closing Date (defined below) and, if that intent should change, City shall promptly notify Hull as soon as possible and provide Hull with any prospective sale terms. Prior to January 31, 2021, City shall present Hull with a proclamation of the donation and/or a written acknowledgement of Hull's donation (contribution) of the Donation Property, as required by the Internal Revenue Service, including a description of the property donated and the statement that no goods or services were provided in exchange for the contribution. As the donor of the Donation Property Hull assumes full responsibility and releases the City from any responsibility or liability for complying with laws and regulations related to or governing the valuation of the Donation Property or the deduction of that value from income subject to state or federal income tax. Notwithstanding that, City shall cooperate with Hull in completing and executing IRS Form 8283 (or other forms as may be reasonably required) in a timely manner. 3. Escrow. Within two (2) business days of the Effective Date, the Parties shall open an escrow with Redwood Empire Title Company of Mendocino County ("Escrow Agent" or "Title Company") in Ukiah, California, to facilitate the transfer of title to the Donation Property. Close of escrow shall occur on a mutually -agreeable date so long as it is before December 31, 2020 ("Close of Escrow" or "Closing Date"), which date shall be selected by the Parties, in coordination with Escrow Agent, within ten (10) days of the Effective Date and confirmed in writing by the Parties, with copy to Escrow Agent. 4. Title Report and Objections. Hull shall promptly cause Title Company to prepare and deliver to Hull and City a current preliminary title report on the Donation Property ("Report"), together with copies of all recorded title exceptions shown on the Report. City shall bear the cost of the Report. City shall promptly notify Hull in writing of any objections to matters disclosed in the Report, including any exceptions related to or other failure to insure access to the Donation Property. Hull may, but need not, take action to remedy the objectionable item. If, on or before the Closing Date, either party is unwilling or unable to waive or remedy, as the case may be, any such objectionable item, that party may terminate this Agreement by written notice to the other party, in which event this Agreement shall terminate without default by or liability to either party. 5. Warranties or Representations. a. Hull. Hull represents and warrants he has full power and authority to enter this Agreement and all proceedings required to be taken by or on Hull's behalf to authorize Hull to make, deliver, and carry out this Agreement's terms Donation Agreement & Joint Escrow Instructions Page 2 of 7 have been duly and properly taken, including conveying to City by grant deed all of Hull's right, title, and interest in and to the Donation Property, including a right of access to the Donation Property satisfactory to City across real property owned by Hull. No further consent of any person or entity is required related to Hull's performance under this Agreement. Other than the representations and warranties expressly stated above in this section, Hull makes no warranties or representations whatsoever, express or implied, related to or in connection with the Donation Property. City acknowledges it will acquire title and possession of the Donation Property "AS IS." b. City. City, including the undersigned representative of it, represents and warrants it has full power and authority to enter this Agreement and all proceedings required to be taken by or on City's behalf to authorize City (and the undersigned representative of it) to make, deliver, and carry out this Agreement's terms have been duly and properly taken, including the authority to accept from Hull the conveyance by grant deed of all Hull's right, title, and interest in and to the Donation Property. No further consent of any person or entity is required related to City's performance under this Agreement. City shall provide Hull and Escrow Agent any consent or resolution authorizing City to consummate the transaction(s) contemplated by this Agreement as may be reasonably required. Other than the representations and warranties expressly stated above in this section, City makes no warranties or representations whatsoever, express or implied, related to or in connection with its acceptance of title to the Donation Property. c. Mutual. The Parties each represent that neither of them engaged or otherwise dealt with a finder or real estate broker or salesperson with regard to the transaction(s) contemplated by this Agreement. In the event a contrary claim is made by such a person/entity, the party for whom such services were allegedly provided shall indemnify, defend, and hold the other party harmless from and against any and all losses, claims, demands, expenses, damages, liabilities or causes of action, however any of the same may be characterized, related to said person/entity. 6. Title and Escrow Costs. City shall pay all title, title insurance, and escrow costs, fees, and expenses incurred or generated by the transaction(s) contemplated by this Agreement. City shall deposit all monetary sums, and the Parties shall each deposit all documents, with Escrow Agent necessary to consummate the transaction(s) contemplated by this Agreement. Each party shall bear their own attorney's fees and costs incurred in connection with this Agreement. 7. Notice Regarding Advisability of Title Insurance: IMPORTANT: IN ACQUIRING REAL PROPERTY, IT MAY BE ADVISABLE TO OBTAIN TITLE INSURANCE IN CONNECTION WITH THE CLOSE OF ESCROW SINCE THERE MAY BE PRIOR RECORDED LIENS AND ENCUMBRANCES WHICH AFFECT YOUR INTEREST IN THE PROPERTY BEING ACQUIRED. A NEW POLICY OF TITLE INSURANE SHOULD BE OBTAINED IN ORDER TO INSURE YOUR INTEREST IN THE PROPERTY THAT IS BEING ACQUIRED. 8. Conditions. This Agreement is expressly conditioned on: a. The Close of Escrow, inclusive of recordation of the Deed in the official records of Mendocino County, on or before December 31, 2020. This Agreement and any documents executed or actions taken to further the transaction(s) contemplated by it, shall be null and void absent satisfaction of said condition. Donation Agreement & Joint Escrow Instructions Page 3 of 7 b. Hull's right, expressed above, to terminate or cancel this Agreement, in Hull's sole discretion, at any time prior to the Close of Escrow. Any such termination or cancellation by Hull shall in no event constitute a default or result in liability to either party, except as described in section 1, above. c. On the Closing Date, the Title Company shall be prepared to issue to City, as of that date, any policy of title insurance (CLTA or ALTA at City's option) reasonably requested by City upon payment of its regularly -scheduled premium, with total liability in the amount of $1,366,912, insuring City that the Donation Property is vested in City, subject to the standard printed exceptions and those particular exceptions otherwise appearing on the Report, as may be amended (subject to section 4, above). d. The Parties representations and warranties as made herein shall be true and correct in all material respects as of the Closing Date. e. City's deposit with the Escrow Agent of sums sufficient to close the transaction(s) contemplated by this Agreement. f. The Parties shall make good faith and diligent efforts to cooperate with one another, the Escrow Agent, and others involved in the transaction(s) contemplated by, and to satisfy their respective obligations and the conditions precedent specified in, this Agreement, inclusive of executing further escrow instructions and other forms consistent with and reasonably necessary to implement the terms of this Agreement. 9. Escrow Agent's Closing. After all deposits are made and the obligations of the Parties and conditions are satisfied or it is imminent they will be satisfied (e.g. closing by Dec. 31, 2020, Title Company prepared to issue title insurance), Escrow agent shall record the Deed and deliver the policy of title insurance to City. 10. Miscellaneous. a. Notices. All notices and any other communications permitted or required under this Agreement must be in writing and will be effective (a) immediately upon delivery in person or by facsimile, or upon delivery to the recipient if attached to an email communication; (b) on the date of delivery, as evidenced by the records of the courier, if deposited with a nationally -recognized commercial courier for overnight delivery, provided delivery is made during regular business hours or receipt is acknowledged by a person reasonably believed by the delivering party to be employed by the recipient; or (c) on the date indicated on the return receipt, if deposited with the United States Postal Service, certified mail, return receipt requested, postage prepaid. Any notice to be given by any party hereto may be given by the counsel for such party. All notices must be properly addressed and delivered to the parties at the addresses set forth below, or at such other addresses as either party may subsequently designate by written notice given in the manner provided in this section and a copy of all notices and other communications shall be delivered by email: Hull: David J. Hull 376 East Gobbi Street Ukiah, CA 95482 Donation Agreement & Joint Escrow Instructions Page 4 of 7 Email: davehullins@yahoo.com City: City of Ukiah Attention: Sage Sangiacomo, City Manager Ukiah Civic Center 300 Seminary Ave Ukiah, CA. 95482 Fax: 707-463-6204 Email: ssangiacomo@cityofukiah.com b. Cooperation. The Parties agree to execute such other documents and to perform such other acts as reasonably necessary or desirable to carry out the purpose of this Agreement, both before and after the Closing Date. c. Binding Effect & Assignment. This Agreement shall be binding on and inure to the benefit of the Parties respective heirs, successors, and permitted assignees. d. Governing Law. This Agreement is entered into and shall be governed by, and construed and enforced in accordance with, the laws of the State of California (without giving effect to its choice of law principles). The parties agree to the jurisdiction of the California state courts and to venue in the state courts in Mendocino County. e. Construction. The Parties are each represented by counsel and jointly participated in preparing this Agreement; it shall be deemed drafted and prepared by both parties, and any rule of construction that serves to resolve ambiguities or other interpret language against the drafting party shall not be employed in relation to this Agreement. f. Counterparts. This Agreement may be executed in counterparts, all together which shall be deemed an original, single, instrument. Electronic signatures shall be deemed original. Dated: December/1,2020 Dated: December 672020 HU 71t/cP DAVID J. LL Individually and as authorized Representative for all entities comprising "Hull" CITY , AGE r IACOMO City Man. ger City of Ukiah Donation Agreement & Joint Escrow Instructions Page 5 of 7 Approved as to form: Dated: December/% 2020 Dated: December /672020 0 NALD J. McMULLEN Attorney for Hull DARAPPOR'] Attorney for City Donation Agreement & Joint Escrow Instructions Page 6 of 7 EXHIBIT A Donation Agreement & Joint Escrow Instructions Page 7 of 7 It` CITY OF UKIAH - PARCEL DONATION This map is a guide. Every reasonable effort has been made to ensure the accuracy of the map and data provided. Parcel lines are not intended to represent surveyed data. Document Path: CALlsers \astnnklin DesktoraDDOI AN PARDFI nelnuoino rmerl 0 1,000 2,000 111===1Feet Legend Ukiah City Limits Parcel Donation