Exhibit 10.13

 

[LOGO]

STANDARD OFFER, AGREEMENT AND ESCROW

INSTRUCTIONS FOR PURCHASE OF REAL ESTATE

(Non-Residential)

American Industrial Real Estate Association

 

 

March 24, 2003

 

 

 

(Date for Reference Purposes)

 

1.                                      Buyer.

 

1.1  SCP Park Meadows, LLC, an Indiana Limited Liability Company, (“Buyer”)
hereby offers to purchase the real property, hereinafter described, from the
owner thereof (“Seller”) (collectively, the “Parties” or individually, a
“Party”), through an escrow (“Escrow”) to close on or before April 15, 2003
(“Expected Closing Date”) to be held by Stewart Title & Escrow Company (“Escrow
Holder”) whose address is 180 North Riverview Drive, Suite 100, Anaheim,
California 92802, Phone No. (714) 685-2320, Facsimile No. (714) 242-9894 upon
the terms and conditions set forth in this agreement (“Agreement”). Buyer shall
have the right to assign Buyer’s rights hereunder, but any such assignment shall
not relieve Buyer of Buyer’s obligations herein unless Seller expressly releases
Buyer.

 

1.2  The term “Date of Agreement” as used herein shall be the date when by
execution and delivery (as defined in paragraph 20.2) of this document or a
subsequent counteroffer thereto, Buyer and Seller have reached agreement in
writing whereby Seller agrees to sell, and Buyer agrees to purchase, the
Property upon terms accepted by both Parties.

 

2.                                      Property.

 

2.1  The real property (“Property”) that is the subject of this offer consists
of (insert a brief physical description) commonly referred to as Cypress City
Center, an approximate 53,471 square foot professional office building is
located in the City of Cypress, County of Orange, State of California, is
commonly known by the street address of 5400 Orange Avenue and is legally
described as

(APN:                                               ).

 

2.2  If the legal description of the Property is not complete or is inaccurate,
this Agreement shall not be invalid and the legal description shall be completed
or corrected to meet the requirements of Stewart Title Company (“Title
Company”), which shall issue the title policy hereinafter described.

 

2.3  The Property includes, at no additional cost to Buyer, the permanent
improvements thereon, including those items which pursuant to applicable law are
a part of the property, as well as the following items, if any, owned by Seller
and at present located on the Property: electrical distribution systems (power
panel, bus ducting, conduits, disconnects, lighting fixtures); telephone
distribution systems (lines, jacks and connections only); space heaters;
heating, ventilating, air conditioning equipment (“HVAC”); air lines; fire
sprinkler systems; security and fire detection systems; carpets; window
coverings; wall coverings; and                                 
                                                                            (collectively,
the “Improvements”).

 

2.4  The fire sprinkler monitor: o is owned by Seller and included in the
Purchase Price, or o is leased by Seller, and Buyer will need to negotiate a new
lease with the fire monitoring company.

 

2.5  Except as provided in Paragraph 2.3, the Purchase Price does not include
Seller’s personal property, furniture and furnishings, and
                                              .

 

3.                                      Purchase Price.

 

3.1  The purchase price (“Purchase Price”) to be paid by Buyer to Seller for the
Property shall be $5,834,000, payable as follows:

 

 

(a)     Cash down payment, including the Deposit as defined in paragraph 4.3 (or
if an all cash transaction, the Purchase Price):

 

$

5,834,000

 

 

 

 

 

 

 

 

Total Purchase Price:

 

$

5,834,000

 

 

3.2  If Buyer is taking title to the Property subject to, or assuming, and
Existing Deed of Trust and such deed of trust permits the beneficiary to demand
payment of fees including, but not limited to, points, processing fees, and
appraisal fees as a condition to the transfer of the Property, Buyer agrees to
pay such fees up to a maximum of 1.5% of the unpaid principal balance of the
applicable Existing Note.

 

4.                                      Deposits.

 

/s/ JBU

 

 

/s/ FM

 

 

 

 

Initials

 

 

Initials

 

2000 – American Industrial Real Estate Association

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Revised

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4.1  o Buyer has delivered to Broker a check in the sum of $
                                          , payable to Escrow Holder, to be held
by Broker until both Parties have executed this Agreement and the executed
Agreement has been delivered to Escrow Holder, or ý Buyer shall deliver to
Escrow Holder a check in the sum of $ 150,000 when both Parties have executed
this Agreement and the executed Agreement has been delivered to Escrow Holder. 
When cashed, the check shall be deposited into the Escrow’s trust account to be
applied toward the Purchase Price of the Property at the Closing.  See Addendum.

 

4.2  Additional deposits:

 

(a)  Within 5 business days after the Date of Agreement, Buyer shall deposit
with Escrow Holder the additional sum of $                                     
to be applied to the Purchase Price at the Closing.

 

(b)  Within 5 business days after the contingencies discussed in paragraph 9.1
(a) through (k) are approved or waived, Buyer shall deposit with Escrow Holder
the additional sum of $                                              to be
applied to the Purchase Price at the Closing.

 

4.3  Escrow Holder shall deposit the funds deposited with it by Buyer pursuant
to paragraphs 4.1 and 4.2 (collectively the “Deposit”), in a State or Federally
chartered bank in an interest bearing account whose term is appropriate and
consistent with the timing requirements of this transaction.  The interest
therefrom shall accrue to the benefit of Buyer, who hereby acknowledges that
there may be penalties or interest forfeitures if the applicable instrument is
redeemed prior to its specified maturity.  Buyer’s Federal Tax Identification
Number is                                           .  NOTE: Such interest
bearing account cannot be opened until Buyer’s Federal Tax Identification Number
is provided.

 

5.             INTENTIONALLY DELETED

 

6.                                      Seller Financing (Purchase Money Note).

 

7.                                      Real Estate Brokers.

 

7.1  The following real estate broker(s) (“Brokers”) and brokerage relationships
exist in this transaction and are consented to by the Parties (check the
applicable boxes):

 

ý  Grubb & Ellis Company

 

represents Seller exclusively (“Seller’s Broker”);

 

 

 

ý  Peter Papke

 

represents Buyer exclusively (“Buyer’s Broker”); or

 

 

 

o

 

represents both Seller and Buyer (“Dual Agency”).

 

The Parties acknowledge that Brokers are the procuring cause of this Agreement. 
See paragraph 24 for disclosures regarding the nature of a real estate agency
relationship.

 

7.2  Buyer and Seller each represent and warrant to the other that he/she/it has
had no dealings with any person, firm, broker or finder in connection with the
negotiation of this Agreement and/or the consummation of the purchase and sale
contemplated herein, other than the Brokers named in paragraph 7.1, and no
broker or other person, firm or entity, other than said Brokers is/are entitled
to any commission or finder’s fee in connection with this transaction as the
result of any dealings or acts of such Party.  Buyer and Seller do each hereby
agree to indemnify, defend, protect and hold the other harmless from and against
any costs, expenses or liability for compensation, commission or charges which
may be claimed by any broker, finder or other similar party, other than said
named Brokers by reason of any dealings or act of the indemnifying Party.

 

8.                                      Escrow and Closing.

 

8.1  Upon acceptance hereof by Seller, this Agreement, including any
counter-offers incorporated herein by the Parties, shall constitute not only the
agreement of purchase and sale between Buyer and Seller, but also instructions
to Escrow Holder for the consummation of the Agreement through the Escrow.
 Escrow Holder shall not prepare any further escrow instructions restating or
amending the Agreement unless specifically so instructed by the Parties or a
Broker herein.  Subject to the reasonable approval of the Parties, Escrow Holder
may, however, include its standard general escrow provisions.

 

8.2  As soon as practical after the receipt of this Agreement and any relevant
counteroffers, Escrow Holder shall ascertain the Date of Agreement as defined in
paragraphs 1.2 and 20.2 and advise the Parties and Brokers, in writing, of the
date ascertained.

 

8.3  Escrow Holder is hereby authorized and instructed to conduct the Escrow in
accordance with this Agreement, applicable law and custom and practice of the
community in which Escrow Holder is located, including any reporting
requirements of the Internal Revenue Code.  In the event of a conflict between
the law of the state where the Property is located and the law of the state
where the Escrow Holder is located, the law of the state where the Property is
located shall prevail.

 

8.4  Subject to satisfaction of the contingencies herein described, Escrow
Holder shall close this escrow (the “Closing”) by recording a general warranty
deed (a grant deed in California) and the other documents required to be
recorded, and by disbursing the funds and documents in accordance with this
Agreement.

 

8.5  Buyer and Seller shall each pay one-half of the Escrow Holder’s charges and
Seller shall pay the usual recording fees and any required documentary transfer
taxes.  Seller shall pay the premium for a standard coverage owner’s policy of
title insurance.  See Addendum.

 

8.6  Escrow Holder shall verify that all of Buyer’s contingencies have been
satisfied or waived prior to Closing.  The matters contained in paragraphs 9.1
subparagraphs (b), (c), (d), (e), (g), (l), (n), and (o), 9.4, 9.5, 12, 13, 14,
16, 18, 20, 21, 22, and 24 are, however, matters of agreement between the

 

 

/s/ JBU

 

 

/s/ FM

 

 

 

 

Initials

 

 

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2000 – American Industrial Real Estate Association

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Revised

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Parties only and are not instructions to Escrow Holder.

 

8.7  If this transaction is terminated for non-satisfaction and non-waiver of a
Buyer’s Contingency, as defined in paragraph 9.2, then neither of the Parties
shall thereafter have any liability to the other under this Agreement, except to
the extent of a breach of any affirmative covenant or warranty in this
Agreement.  In the event of such termination, Buyer shall be promptly refunded
all funds deposited by Buyer with Escrow Holder, less only Title Company and
Escrow Holder cancellation fees and costs, all of which shall be Buyer’s
obligation.

 

8.8  The Closing shall occur on the Expected Closing Date, or as soon thereafter
as the Escrow is in condition for Closing; provided, however, that if the
Closing does not occur by the Expected Closing Date and said Date is not
extended by mutual instructions of the Parties, a Party not then in default
under this Agreement may notify the other Party, Escrow Holder, and Brokers, in
writing that, unless the Closing occurs within 5 business days following said
notice, the Escrow shall be deemed terminated without further notice or
instructions.

 

8.9  Except as otherwise provided herein, the termination of Escrow shall not
relieve or release either Party from any obligation to pay Escrow Holder’s fees
and costs or constitute a waiver, release or discharge of any breach or default
that has occurred in the performance of the obligations, agreements, covenants
or warranties contained therein.

 

8.10  If this Escrow is terminated for any reason, then at Seller’s request, and
as a condition to the return of Buyer’s deposit, Buyer shall within 5 days after
written request deliver to Seller, at no charge, copies of all surveys,
engineering studies, soil reports, maps, master plans, feasibility studies and
other similar items prepared by or for Buyer that pertain to the Property. 

 

9.                                      Contingencies to Closing.

 

9.1  The Closing of this transaction is contingent upon the satisfaction or
waiver of the following contingencies.  IF BUYER FAILS TO NOTIFY ESCROW HOLDER,
IN WRITING, OF THE APPROVAL OF ANY OF SAID CONTINGENCIES WITHIN THE TIME
SPECIFIED THEREIN, IT SHALL BE CONCLUSIVELY PRESUMED THAT BUYER HAS DISAPPROVED
SUCH ITEM, MATTER OR DOCUMENT.  Buyer’s conditional approval shall constitute
disapproval, unless provision is made by the Seller within the time specified
therefore by the Buyer in such conditional approval or by this Agreement,
whichever is later, for the satisfaction of the condition imposed by the Buyer. 
Escrow Holder shall promptly provide all Parties with copies of any written
disapproval or conditional approval which it receives.  With regard to
subparagraphs (a) through (l) the pre-printed time periods shall control unless
a different number of days is inserted in the spaces provided.

 

(a) Disclosure. Seller shall make to Buyer, through escrow, all of the
applicable disclosures required by law (See American Industrial Real Estate
Association (“AIR”) standard form entitled “Seller’s Mandatory Disclosure
Statement”) and provide Buyer with a completed Property Information Sheet
(“Property Information Sheet”) concerning the Property, duly executed by or on
behalf of Seller in the current form or equivalent to that published by the AIR
within N/A days following the Date of Agreement.  Buyer has N/A days from the
receipt of said disclosures to approve or disapprove the matters disclosed.  SEE
ADDENDUM

 

(b) Physical Inspection. Buyer has N/A days from the receipt of the Property
Information Sheet or the Date of Agreement, whichever is later, to satisfy
itself with regard to the physical aspects and size of the Property.  SEE
ADDENDUM

 

(c) Intentionally deleted.

 

(d) Soil Inspection. Buyer has N/A days from Date of Agreement, to satisfy
itself with regard to the condition of the soils on the Property.  Seller
recommends that Buyer obtain a soil test report.  Any such report shall be paid
for by Buyer.  Seller has provided Buyer with copies of any soils report that
Seller may have.  SEE ADDENDUM

 

(e) Governmental Approvals. Buyer has N/A days from the Date of Agreement to
satisfy itself with regard to approvals and permits from governmental agencies
or departments which have or may have jurisdiction over the Property and which
Buyer deems necessary or desirable in connection with its intended use of the
Property, including, but not limited to, permits and approvals required with
respect to zoning, planning, building and safety, fire, police, handicapped and
Americans with Disabilities Act requirements, transportation and environmental
matters.  SEE ADDENDUM

 

(f) Conditions of Title. Escrow Holder shall cause a current commitment for
title Insurance (“Title Commitment”) concerning the Property issued by the Title
Company, as well as legible copies of all documents referred to in the Title
Commitment (“Underlying Documents”) to be delivered to Buyer within N/A days
following the Date of Agreement.  Buyer has N/A days from the receipt of the
Title Commitment and Underlying Documents to satisfy itself with regard to the
condition of title.  The disapproval of Buyer of any monetary encumbrance, which
by the terms of this Agreement is not to remain against the Property after the
Closing, shall not be considered a failure of this contingency, as Seller shall
have the obligation, at Seller’s expense, to satisfy and remove such disapproved
monetary encumbrance at or before the Closing.  SEE ADDENDUM

 

(g) Survey. Buyer has N/A days from the receipt of the Title Commitment and
Underlying Documents and the Survey to satisfy itself with regard to any ALTA
title supplement based upon a survey prepared to American Land Title Association
(“ALTA”) standards for an owner’s policy by a licensed surveyor, showing the
legal description and boundary lines of the Property, any easements of record,
and any improvements, poles, structures and things located within 10 feet of
either side of the Property boundary lines.  Any such survey shall be prepared
at Buyer’s direction and expense.  If Buyer has obtained a survey and approved
the ALTA title supplement, Buyer may elect within the period allowed for Buyer’s
approval of a survey to have an ALTA extended coverage owner’s form of title
policy, in which event Buyer shall pay any additional premium attributable
thereto.  SEE ADDENDUM

 

/s/ JBU

 

 

/s/ FM

 

 

 

 

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(h) Intentionally deleted.

 

(i) Intentionally deleted.

 

(j) Intentionally deleted.

 

(k) Intentionally deleted.

 

2000 – American Industrial Real Estate Association

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Revised

FORM OFA-4-8/00 EE

 

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(l) Personal Property. In the event that any personal property is included in
the Purchase Price, Buyer has 10 or         days from the Date of Agreement to
satisfy itself with regard to the title condition of such personal property.
Seller recommends that Buyer obtain a UCC-1 report. Any such report shall be
paid for by Buyer. Seller shall provide Buyer copies of any liens or
encumbrances affecting such personal property that it is aware of within 10 or
        days of the Date of Agreement.

 

(m) Destruction, Damage or Loss. There shall not have occurred prior to the
Closing, a destruction of, or damage or loss to, the Property or any portion
thereof, from any cause whatsoever, which would cost more than $10,000.00 to
repair or cure. If the cost of repair or cure is $10,000.00 or less, Seller
shall repair or cure the loss prior to the Closing. Buyer shall have the option,
within 10 days after receipt of written notice of a loss costing more than
$10,000.00 to repair or cure, to either terminate this transaction or to
purchase the Property notwithstanding such loss, but without deduction or offset
against the Purchase Price. If the cost to repair or cure is more than
$10,000.00, and Buyer does not elect to terminate this transaction, Buyer shall
be entitled to any insurance proceeds applicable to such loss. Unless otherwise
notified in writing, Escrow Holder shall assume no such destruction, damage or
loss has occurred prior to Closing.

 

(n) Material Change. Buyer shall have 10 days following receipt of written
notice of a Material Change within which to satisfy itself with regard to such
change. “Material Change” shall mean a change in the status of the use,
occupancy, tenants, or condition of the Property that occurs after the date of
this offer and prior to the Closing. Unless otherwise notified in writing.
Escrow Holder shall assume that no Material Change has occurred prior to the
Closing.

 

(o) Seller Performance. The delivery of all documents and the due performance by
Seller of each and every undertaking and agreement to be performed by Seller
under this Agreement.

 

(p) Warranties. That each representation and warranty of Seller herein be true
and correct as of the Closing. Escrow Holder shall assume that this condition
has been satisfied unless notified to the contrary in writing by any Party prior
to the Closing.

 

(q) Brokerage Fee. Payment at the Closing of such brokerage fee as is specified
in this Agreement or later written instructions to Escrow Holder executed by
Seller and Brokers (“Brokerage Fee”). It is agreed by the Parties and Escrow
Holder that Brokers are a third party beneficiary of this Agreement insofar as
the Brokerage Fee is concerned, and that no change shall be made with respect to
the payment of the Brokerage Fee specified in this Agreement, without the
written consent of Brokers.

 

9.2  All of the contingencies specified in subparagraphs (a) through (p) of
paragraph 9.1 are for the benefit of, and may be waived by, Buyer, and may be
elsewhere herein referred to as “Buyer Contingencies.”

 

9.3  If any Buyer’s Contingency or any other matter subject to Buyer’s approval
is disapproved as provided for herein in a timely manner (“Disapproved Item”),
Seller shall have the right within 10 days following the receipt of notice of
Buyer’s disapproval to elect to cure such Disapproved Item prior to the Expected
Closing Date (“Seller’s Election”). Seller’s failure to give to Buyer within
such period, written notice of Seller’s commitment to cure such Disapproved Item
on or before the Expected Closing Date shall be conclusively presumed to be
Seller’s Election not to cure such Disapproved Item. If Seller elects, either by
written notice or failure to give written notice, not to cure a Disapproved
Item, Buyer shall have the election, within 10 days after Seller’s Election to
either accept title to the Property subject to such Disapproved Item, or to
terminate this transaction. Buyer’s failure to notify Seller in writing of
Buyer’s election to accept title to the Property subject to the Disapproved Item
without deduction or offset shall constitute Buyer’s election to terminate this
transaction. Unless expressly provided otherwise herein, Seller’s right to cure
shall not apply to the remediation of Hazardous Substance Conditions or to the
Financing Contingency. Unless the Parties mutually instruct otherwise, if the
time periods for the satisfaction of contingencies or for Seller’s and Buyer’s
said Elections would expire on a date after the Expected Closing Date, the
Expected Closing Date shall be deemed extended for 3 business days following the
expiration of: (a) the applicable contingency period(s), (b) the period within
which the Seller may elect to cure the Disapproved Item, or (c) if Seller elects
not to cure, the period within which Buyer may elect to proceed with this
transaction, whichever is later.

 

9.4  Buyer understands and agrees that until such time as all Buyer’s
Contingencies have been satisfied or waived, Seller and/or its agents may
solicit, entertain and/or accept back-up offers to purchase the subject
Property.

 

9.5  The Parties acknowledge that extensive local, state and Federal legislation
establish broad liability upon owners and/or users of real property for the
investigation and remediation of Hazardous Substances. The determination of the
existence of a Hazardous Substance Condition and the evaluation of the impact of
such a condition are highly technical and beyond the expertise of Brokers. The
Parties acknowledge that they have been advised by Brokers to consult their own
technical and legal experts with respect to the possible presence of Hazardous
Substances on this Property or adjoining properties, and Buyer and Seller are
not relying upon any investigation by or statement of Brokers with respect
thereto. The Parties hereby assume all responsibility for the impact of such
Hazardous Substances upon their respective interests herein.

 

10.                               Documents Required at or before Closing:

 

10.1  Five days prior to the Closing date Escrow Holder shall obtain an updated
Title Commitment concerning the Property from the Title Company and provide
copies thereof to each of the Parties.

 

10.2  Seller shall deliver to Escrow Holder in time for delivery to Buyer at the
Closing:

 

(a)  Grant or general warranty deed, duly executed and in recordable form,
conveying fee title to the Property to Buyer.

 

(b)  If applicable, the Beneficiary Statements concerning Existing Note(s).

 

(c) Intentionally deleted.

 

(d) Intentionally deleted.

 

(e) An affidavit executed by Seller to the effect that Seller is not a “foreign
person” within the meaning of Internal Revenue Code Section 1445 or successor
statutes. If Seller does not provide such affidavit in from reasonably
satisfactory to Buyer at least 3 business days prior to the Closing, Escrow
Holder shall at the Closing deduct from Seller’s proceeds and remit to Internal
Revenue Service such sum as is required by applicable Federal law with respect
to purchases from foreign sellers.

 

(f) If the Property is located in California, an affidavit executed by Seller to
the effect that Seller is not a “nonresident” within the meaning of California
Revenue and Tax Code Section 18862 or successor statutes. If Seller does not
provide such affidavit in from reasonably satisfactory to Buyer at least 3
business days prior to the Closing, Escrow Holder shall at the Closing deduct
from Seller’s proceeds and remit to the Franchise Tax Board such sum as is
required by such statute.

 

(g) If applicable, a bill of sale, duly executed, conveying title to any
included personal property to Buyer.

 

(h) If the Seller is a corporation, a duly executed corporate resolution
authorizing the execution of this Agreement and the sale of the Property.

 

10.3  Buyer shall deliver to Seller through Escrow:

 

(a) The cash portion of the Purchase Price and such additional sums as are
required of Buyer under this Agreement shall be deposited by Buyer with Escrow
Holder, by federal funds wire transfer, or any other method acceptable to Escrow
Holder as immediately collectable funds, no later than 2:00 P.M. on the business
day prior to the Expected Closing Date.

 

(b) If a Purchase Money Note and Purchase Money Deed of Trust are called for by
this Agreement, the duly executed originals of those documents, the Purchase
Money Deed of Trust being recordable form, together with evidence of fire
insurance on the improvements in the amount of the full replacement cost naming
Seller as a mortgage loss payee, and a real estate tax service contract (at
Buyer’s expense), assuring Seller of notice of the status of payment of real
property taxes during the life of the Purchase Money Note.

 

(e) If applicable, a written assumption duly executed by Buyer of the loan
documents with respect to Existing Notes,

 

(f) If the Buyer is a corporation, a duly executed corporate resolution
authorizing the execution of this Agreement and the purchase of the Property.

 

10.4  At Closing, Escrow Holder shall cause to be issued to Buyer a standard
coverage (or ALTA extended, if elected pursuant to 9.1(g)) owner’s form policy
of title insurance effective as of the Closing, issued by the Title Company in
the full amount of the Purchase Price, insuring title to the Property vested in
Buyer, subject only to the exceptions approved by Buyer. In the event there is a
Purchase Money Deed of Trust in this transaction, the policy of title insurance
shall be a joint protection policy insuring both Buyer and Seller.

IMPORTANT: IN A PURCHASE OR EXCHANGE OF 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 INSURANCE SHOULD BE OBTAINED IN ORDER TO
ENSURE YOUR INTEREST IN THE PROPERTY THAT YOU ARE ACQUIRING.

 

11.                               Prorations and Adjustments.

 

11.1  Intentionally deleted.

 

11.2  Intentionally deleted.

 

11.3  Intentionally deleted.

 

11.4  Intentionally deleted.

 

/s/ JBU

 

 

/s/ FM

 

 

 

 

Initials

 

 

Initials

 

2000 – American Industrial Real Estate Association

Page 4 of 8
Revised

FORM OFA-4-8/00 EE

 

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Post Closing

 

11.6  Variations in Existing Note Balances.  In the event that Buyer is
purchasing the Property subject to an Existing Deed of Trust(s), and in the
event that a Beneficiary Statement as to the applicable Existing Note(s)
discloses that the unpaid principal balance of such Existing Note(s) at the
Closing will be more or less than the amount set forth in paragraph 3.1(c)
hereof (“Existing Note Variation”), then the Purchase Money Note(s) shall be
reduced or increased by an amount equal to such Existing Note Variation.  If
there is to be no Purchase Money Note, the cash required at the Closing per
paragraph 3.1(a) shall be reduced or increased by the amount of such Existing
Note Variation.

 

11.7  Variations in New Loan Balance.  In the event Buyer is obtaining a New
Loan and the amount ultimately obtained exceeds the amount set forth in
paragraph 5.1, then the amount of the Purchase Money Note, if any, shall be
reduced by the amount of such excess.

 

12.                               Representation and Warranties of Seller and
Disclaimers. See Addendum

 

12.1  Intentionally deleted.

 

12.2  Intentionally deleted.

 

12.3  In the event that Buyer learns that a Seller representation or warranty
might be untrue prior to the Closing, and Buyer elects to purchase the Property
anyway then, and in that event, Buyer waives any right that it may have to bring
an action or proceeding against Seller or Brokers regarding said representation
or warranty.

 

12.4  Any environmental reports, soils reports, surveys, and other similar
documents which were prepared by third party consultants and provided to Buyer
by Seller or Seller’s representatives, have been delivered as an accommodation
to Buyer and without any representation or warranty as to the sufficiency,
accuracy, completeness, and/or validity of said documents, all of which Buyer
relies on at its own risk.  Seller believes said documents to be accurate, but
Buyer is advised to retain appropriate consultants to review said documents and
investigate the Property.

 

13.                               Possession.

 

Possession of the Property shall be given to Buyer at the Closing subject to the
rights of tenants under Existing Leases.

 

14.                               Buyer’s Entry.

 

At any time during the Escrow period, Buyer, and its agents and representatives,
shall have the right at reasonable times and subject to rights of tenants, to
enter upon the Property for the purpose of making inspections and tests
specified in this Agreement.  No destructive testing shall be conducted,
however, without Seller’s prior approval which shall not be unreasonably
withheld.  Following any such entry or work, unless otherwise directed in
writing by Seller, Buyer shall return the Property to the condition it was in
prior to such entry or work, including the recompaction or removal of any
disrupted soil or material as Seller may reasonably direct.  All such
inspections and tests and any other work conducted or materials furnished with
respect to the Property by or for Buyer shall be paid for by Buyer as and when
due and Buyer shall indemnify, defend, protect and hold harmless Seller and the
Property of and from any and all claims, liabilities, losses, expenses
(including reasonable attorneys’ fees), damages, including those for injury to
person or property, arising out of or relating to any such work or materials or
the acts or omissions of Buyer, its agents or employees in connection therewith.

 

15.                               Further Documents and Assurances.

 

The Parties 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.  The Parties agree to provide all further
information, and to execute and deliver all further documents, reasonably
required by Escrow Holder or the Title Company.

 

16.                               Attorneys’ Fees.

 

If any Party or Broker brings an action or proceeding (including arbitration)
involving the Property whether founded in tort, contract or equity, or to
declare rights hereunder, the Prevailing Party (as hereafter defined) in any
such proceeding, action, or appeal thereon, shall be entitled to reasonable
attorneys’ fees.  Such fees may be awarded in the same suit or recovered in a
separate suit, whether or not such action or proceeding is pursued to decision
or judgment.  The term “Prevailing Party” shall include, without limitation, a
Party or Broker who substantially obtains or defeats the relief sought, as the
case may be, whether by compromise, settlement, judgment, or the abandonment by
the other Party or Broker of its claim or defense.  The attorneys’ fees award
shall not be computed in accordance with any court fee schedule, but shall be
such as to fully reimburse all attorneys’ fees reasonably incurred.

 

17.                               Prior Agreements/Amendments.

 

17.1  This Agreement supersedes any and all prior agreements between Seller and
Buyer regarding the Property.

 

17.2  Amendments to this Agreement are effective only if made in writing and
executed by Buyer and Seller.

 

18.                               Broker’s Rights.

 

18.1  If this sale is not consummated due to the default of either the Buyer or
Seller, the defaulting Party shall be liable to and shall pay to Brokers the
Brokerage Fee that Brokers would have received had the sale been consummated. 
If Buyer is the defaulting party, payment of said Brokerage Fee is in addition
to any obligation with respect to liquidated or other damages.

 

18.2  Intentionally deleted.

 

19.                               Notices.

 

19.1  Whenever any Party, Escrow Holder or Brokers herein shall desire to give
or serve any notice, demand, request, approval, disapproval or other
communication, each such communication shall be in writing and shall be
delivered personally, by messenger or by mail, postage prepaid, to the address
set forth in this Agreement or by facsimile transmission.

 

19.2  Service of any such communication shall be deemed made on the date of
actual receipt if personally delivered.  Any such communication sent by regular
mail shall be deemed given 48 hours after the same is mailed.  Communications
sent by United States Express Mail or overnight courier that guarantee next day
delivery shall be deemed delivered 24 hours after delivery of the same to the
Postal Service or courier.  Communications transmitted by facsimile transmission
shall be deemed delivered upon telephonic confirmation of receipt (confirmation
report from fax machine is sufficient), provided a copy is also delivered via
delivery or mail.  If such communication is received on a Saturday, Sunday or
legal holiday, it shall be deemed received on the next business day.

 

19.3  Any Party or Broker hereto may from time to time, by notice in writing,
designate a different address to which, or a different person or additional
persons to whom, all communications are thereafter to be made.

 

20.                               Duration of Offer.

 

20.1  If this offer is not accepted by Seller on or before 5:00 P.M. according
to the time standard applicable to the city of Cypress on the date of March 24,
2003, it shall

 

 

/s/ JBU

 

 

/s/ FM

 

 

 

 

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be deemed automatically revoked.

 

20.2  The acceptance of this offer, or of any subsequent counteroffer hereto,
that creates an agreement between the Parties as described in paragraph 1.2,
shall be deemed made upon delivery to the other Party or either Broker herein of
a duly executed writing unconditionally accepting the last outstanding offer or
counteroffer.

 

21.                               LIQUIDATED DAMAGES.  (This Liquidated Damages
paragraph is applicable only if initialed by both Parties).

 

THE PARTIES AGREE THAT IT WOULD BE IMPRACTICABLE OR EXTREMELY DIFFICULT TO FIX,
PRIOR TO SIGNING THIS AGREEMENT, THE ACTUAL DAMAGES WHICH WOULD BE SUFFERED BY
SELLER IF BUYER FAILS TO PERFORM ITS OBLIGATIONS UNDER THIS AGREEMENT.
THEREFORE, IF, AFTER THE SATISFACTION OR WAIVER OF ALL CONTINGENCIES PROVIDED
FOR THE BUYER’S BENEFIT, BUYER BREACHES THIS AGREEMENT, SELLER SHALL BE ENTITLED
TO LIQUIDATED DAMAGES IN THE AMOUNT OF $150,000. UPON PAYMENT OF SAID SUM TO
SELLER, BUYER SHALL BE RELEASED FROM ANY FURTHER LIABILITY TO SELLER, AND ANY
ESCROW CANCELLATION FEES AND TITLE COMPANY CHARGES SHALL BE PAID BY SELLER.

 

 

/s/ JBU

 

/s/ FM

 

 

Buyer Initials

 

Seller Initials

 

 

22.                               ARBITRATION OF DISPUTES.  SEE ADDENDUM.

 

 

/s/ JBU

 

/s/ FM

 

 

Buyer Initials

 

Seller Initials

 

 

23.                               Miscellaneous.

 

23.1  Binding Effect.     This Agreement shall be binding on the Parties without
regard to whether or not paragraphs 21 and 22 are initialed by both of the
Parties.  Paragraphs 21 and 22 are each incorporated into this Agreement only if
initialed by both Parties at the time that the Agreement is executed.

 

23.2  Applicable Law.    This Agreement shall be governed by, and paragraph 22.3
is amended to refer to, the laws of the state in which the Property is located.

 

23.3  Time of Essence.    Time is of the essence of this Agreement.

 

23.4  Counterparts.         This Agreement may be executed by Buyer and Seller
in counterparts, each of which shall be deemed an original, and all of which
together shall constitute one and the same instrument.  Escrow Holder, after
verifying that the counterparts are identical except for the signatures, is
authorized and instructed to combine the signed signature pages on one of the
counterparts, which shall then constitute the Agreement.

 

23.5  Waiver of Jury Trial.  THE PARTIES HEREBY WAIVE THEIR RESPECTIVE RIGHTS TO
TRIAL BY JURY IN ANY ACTION OR PROCEEDING INVOLVING THE PROPERTY OR ARISING OUT
OF THIS AGREEMENT.

 

23.6  Conflict.  Any conflict between the printed provisions of this Agreement
and the typewritten or handwritten provisions shall be controlled by the
typewritten or handwritten provisions.

 

24.                               Disclosures Regarding The Nature of a Real
Estate Agency Relationship.

 

24.1  The Parties and Brokers agree that their relationship(s) shall be governed
by the principles set forth in the applicable sections of the California Civil
Code, as summarized in paragraph 24.2.

 

24.2  When entering into a discussion with a real estate agent regarding a real
estate transaction, a Buyer or Seller should from the outset understand what
type of agency relationship or representation it has with the agent or agents in
the transaction. Buyer and Seller acknowledge being advised by the Brokers in
this transaction, as follows:

 

(a) Seller’s Agent. A Seller’s agent under a listing agreement with the Seller
acts as the agent for the Seller only.  A Seller’s agent or subagent has the
following affirmative obligations: (1) To the Seller: A fiduciary duty of utmost
care, integrity, honesty, and loyalty in dealings with the Seller. (2) To the
Buyer and the Seller: a. Diligent exercise of reasonable skills and care in
performance of the agent’s duties. b.  A duty of honest and fair dealing and
good faith. c. A duty to disclose all facts known to the agent materially
affecting the value or desirability of the property that are not known to, or
within the diligent attention and observation of, the Parties.  An agent is not
obligated to reveal to either Party any confidential information obtained from
the other Party which does not involve the affirmative duties set forth above.

 

(b) Buyer’s Agent. A selling agent can, with a Buyer’s consent, agree to act as
agent for the Buyer only.  In these situations, the agent is not the Seller’s
agent, even if by agreement the agent may receive compensation for services
rendered, either in full or in part from the Seller.  An agent acting only for a
Buyer has the following affirmative obligations. (1) To the Buyer: A fiduciary
duty of utmost care, integrity, honesty, and loyalty in dealings with the Buyer.
(2) To the Buyer and the Seller: a. Diligent exercise of reasonable skills and
care in performance of the agent’s duties. b. A duty of honest and

 

 

/s/ JBU

 

 

/s/ FM

 

 

 

 

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to, or within the diligent attention and observation of, the Parties.  An agent
is not obligated to reveal to either Party any confidential information obtained
from the other Party which does not involve the affirmative duties set forth
above.

 

(c) Agent Representing Both Seller and Buyer. A real estate agent, either acting
directly or through one or more associate licenses, can legally be the agent of
both the Seller and the Buyer in a transaction, but only with the knowledge and
consent of both the Seller and the Buyer. (1) In a dual agency situation, the
agent has the following affirmative obligations to both the Seller and the
Buyer: a. A fiduciary duty of utmost care, integrity, honesty and loyalty in the
dealings with either Seller or the Buyer. b. Other duties to the Seller and the
Buyer as stated above in their respective sections (a) or (b) of this paragraph
24.2. (2) In representing both Seller and Buyer, the agent may not without the
express permission of the respective Party, disclose to the other Party that the
Seller will accept a price less than the listing price or that the Buyer will
pay a price greater than the price offered. (3) The above duties of the agent in
a real estate transaction do not relieve a Seller or Buyer from the
responsibility to protect their own interests. Buyer and Seller should carefully
read all agreements to assure that they adequately express their understanding
of the transaction. A real estate agent is a person qualified to advise about
real estate. If legal or tax advice is desired, consult a competent
professional.

 

(d) Further Disclosures. Throughout this transaction Buyer and Seller may
receive more than one disclosure, depending upon the number of agents assisting
in the transaction. Buyer and Seller should each read its contents each time it
is presented, considering the relationship between them and the real estate
agent in this transaction and that disclosure. Brokers have no responsibility
with respect to any default or breach hereof by either Party. The liability
(including court costs and attorneys’ fees), of any Broker with respect to any
breach of duty, error or omission relating to this Agreement shall not exceed
the fee received by such Broker pursuant to this Agreement; provided, however,
that the foregoing limitation on each Broker’s liability shall not be applicable
to any gross negligence or willful misconduct of such Broker.

 

24.3 Confidential Information. Buyer and Seller agree to identify to Brokers as
“Confidential” any communication or information given Brokers that is considered
by such Party to be confidential.  See Addendum.

 

25.                               Construction of Agreement. In construing this
Agreement, all headings and titles are for the convenience of the parties only
and shall not be considered a part of this Agreement. Whenever required by the
context, the singular shall include the plural and vice versa. Unless otherwise
specifically indicated to the contrary, the word “days” as used in this
Agreement shall mean and refer to calendar days.  This Agreement shall not be
construed as if prepared by one of the parties, but rather according to its fair
meaning as a whole, as if both parties had prepared it.

 

26.                               Additional Provisions:

 

Additional provisions of this offer, if any, are as follows or are attached
hereto by an addendum consisting of paragraphs                        through
                        . (If there are no additional provisions write “NONE”.)

 

See Addendum to the Standard Offer, Agreement and Escrow Instructions for
Purchase of Real Estate dated March 24, 2003.

 

ATTENTION: NO REPRESENTATION OR RECOMMENDATION IS MADE BY THE AMERICAN
INDUSTRIAL REAL ESTATE ASSOCIATION OR BY ANY BROKER AS TO THE LEGAL SUFFICIENCY,
LEGAL EFFECT, OR TAX CONSEQUENCES OF THIS AGREEMENT OR THE TRANSACTION TO WHICH
IT RELATES. THE PARTIES ARE URGED TO:

 

1.                                       SEEK ADVICE OF COUNSEL AS TO THE LEGAL
AND TAX CONSEQUENCES OF THIS AGREEMENT.

 

2.                                       RETAIN APPROPRIATE CONSULTANTS TO
REVIEW AND INVESTIGATE THE CONDITION OF THE PROPERTY, SAID INVESTIGATION SHOULD

INCLUDE BUT NOT BE LIMITED TO: THE POSSIBLE PRESENCE OF HAZARDOUS SUBSTANCES,
THE ZONING OF THE PROPERTY, THE INTEGRITY AND CONDITION OF ANY STRUCTURES AND
OPERATING SYSTEMS, AND THE SUITABILITY OF THE PROPERTY FOR BUYER’S INTENDED USE.

 

WARNING: IF THE PROPERTY IS LOCATED IN A STATE OTHER THAN CALIFORNIA, CERTAIN
PROVISIONS OF THIS AGREEMENT MAY NEED TO BE REVISED TO COMPLY WITH THE LAWS OF
THE STATE IN WHICH THE PROPERTY IS LOCATED.

 

NOTE:

 

1.                                       THIS FORM IS NOT FOR USE IN CONNECTION
WITH THE SALE OF RESIDENTIAL PROPERTY.

 

2.                                       IF THE BUYER IS A CORPORATION, IT IS
RECOMMENDED THAT THIS AGREEMENT BE SIGNED BY TWO CORPORATE OFFICERS.

 

The undersigned Buyer offers and agrees to buy the Property on the terms and
conditions stated and acknowledges receipt of a copy hereof.

 

 

/s/ JBU

 

 

/s/ FM

 

 

 

 

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BROKER:

BUYER:

 

 

Peter Papke

 

SCP Park Meadows, LLC, an Indiana
Limited Liability Company

 

 

Attn:

 

 

By:

   /s/ JOHN B. URBAHNS

Title:

 

 

Date:

   3-20-03

Address:

 

 

Name Printed:

   JOHN B. URBAHNS

 

 

Title:

  MEMBER

Telephone:

 

 

Telephone/Facsimile:

 

Facsimile:

 

 

 

Federal ID No.

 

 

By:

 

 

Date:

 

 

Name Printed:

 

 

Title:

 

 

Address:

 

 

 

 

Telephone/Facsimile:

 

 

Federal ID No.

 

 

27.                               Acceptance.

 

27.1  Seller accepts the foregoing offer to purchase the Property and hereby
agrees to sell the Property to Buyer on the terms and conditions therein
specified.

 

27.2  Seller acknowledges that Brokers have been retained to locate a Buyer and
are the procuring cause of the purchase and sale of the Property set forth in
this Agreement. In consideration of real estate brokerage service rendered by
Brokers, Seller agrees to pay Brokers a real estate Brokerage Fee in a sum equal
to             % of the Purchase Price divided in such shares as said Brokers
shall direct in writing.  This Agreement shall serve as an irrevocable
instruction to Escrow Holder to pay such Brokerage Fee to Brokers out of the
proceeds accruing to the account of Seller at the Closing.

 

27.3  Seller acknowledges receipt of a copy hereof and authorizes Brokers to
deliver a signed copy to Buyer.

 

NOTE: A PROPERTY INFORMATION SHEET IS REQUIRED TO BE DELIVERED TO BUYER BY
SELLER UNDER THIS AGREEMENT.

 

BROKER:

SELLER:

 

 

Grubb & Ellis Company

 

Medical Control Services, Inc.

 

 

Attn:

Jeff Hanson

 

By:

/s/ FRED McGEE

Title:

 

 

Date:

3-24-03

Address:

4675 MacArthur Court, Suite 1600

 

Name Printed:

FRED McGEE

Newport Beach, California 92660

 

Title:

CFO

Telephone:

 

 

Telephone/Facsimile:

714-243-3301

Facsimile:

 

 

 

714-243-3401

Federal ID No.

 

 

By:

 

 

Date:

 

 

Name Printed:

 

 

Title:

 

 

Address:

 

 

 

 

Telephone/Facsimile:

 

 

Federal ID No.

84-1061 382

 

These forms are often modified to meet changing requirements of law and needs of
the industry.  Always write or call to make sure you are utilizing the most
current form: American Industrial Real Estate Association, 700 South Flower
Street, Suite 600, Los Angeles, CA 90017 (213) 687-8777.

 

ãCopyright 2000-By American Industrial Real Estate Association.  All rights
reserved.

No part of these works may reproduced in any form without permission in writing.

 

 

/s/ JBU

 

 

/s/ FM

 

 

 

 

Initials

 

 

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2000 – American Industrial Real Estate Association

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