**Exhibit10.19**

 

PURCHASE AGREEMENT

by and between

NATROL REALESTATE, INC.AND NATROL REAL ESTATE II, INC.

as Seller,

and

REALTY ASSOCIATES ADVISORS, LLC

as Purchaser
|   | Premises: | 9453 Owensmouth Avenue |
|--------|-----------|------------------------|
|   |      | 21411 Prairie Street   |
|   |      | Chatsworth, California |
|   |      |                   |
|   |      |                   |
|   | Date:     | March 29, 2007    |

 

 

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**PURCHASE AGREEMENT**

** **

THIS PURCHASEAGREEMENT (this “Contract”) is made and entered into as of the EffectiveDate by and between NATROL REAL ESTATE, INC., a California corporation (“NRE”)and NATROL REAL ESTATE II, INC., a California corporation (“NRE II” and,collectively with NRE, “Seller”), and REALTY ASSOCIATES ADVISORS, LLC, aDelaware limited liability company and/or its permitted successors, affiliatesand assigns (“Purchaser”).  Asused herein, the “Effective Date” shall mean the date the Escrow Agent(as hereinafter defined) has received an original counterpart of this Contractexecuted by both Seller and Purchaser, as evidenced by the Escrow Agent’ssignature below.

ARTICLE I

Property

Section1.01.          Property.  Sellerhereby agrees to sell and convey to Purchaser, and Purchaser hereby agrees topurchase from Seller, upon the terms and conditions set forth herein, thefollowing properties and assets:

(a)           Those certain tracts of real propertylocated in Los Angeles, California more particularly described in Exhibit Aattached hereto and made a part hereof for all purposes, together with, to theextent owned by Seller (i) all and singular the rights and appurtenancespertaining to such real property, including any easements, and all right, titleand interest of Seller in and to adjacent streets, alleys and rights-of-way,and (ii) any and all water, water rights or similar rights or privileges(including tap rights) appurtenant to or used in connection with the ownershipor operation of such real property (all of the foregoing being hereinaftercollectively referred to as the “Real Property”).

(b)           All improvements, structures andfixtures now constructed and completed with respect to and situated on the RealProperty, including without limitation those two certain industrial buildingsand related facilities – one located at 9453 Owensmouth Avenue and containingapproximately 132,600 square feet (the “O Building”) and the otherlocated at 21411 Prairie Street and containing approximately 93,120 square feet(the “P Building”), together with all parking areas, loading dockfacilities, landscaping and other improvements, structures and fixtures (all ofthe foregoing being hereinafter collectively referred to as the “Improvements”).

(c)           All parking agreements, rooftop leaseagreements, and all contract rights approved by Purchaser and all otherintangible rights which are appurtenant to the Real Property and/or theImprovements, including the right to use of any trade name associated with theImprovements (other than the name “Natrol” either individually or incombination with any other name) and any and all derivations of such name (allof the foregoing being hereinafter collectively referred to as the “IntangibleProperty”).

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(d)           All heating, plumbing, ventilationand air conditioning systems and equipment, carpet, tile, floor coverings,security devices, sprinkler systems and all other floor and wall coverings,lighting fixtures and things which have been affixed to the real property andcannot be removed without material damage, and building systems used inconnection with the operation of the Improvements separate and apart fromSeller’s (or any Seller’s affiliates’) business operations (all of theforegoing being hereinafter collectively referred to as the “Personal Property”).

All of theforegoing items purchased under this Contract are collectively referred to asthe “Property”.

Section1.02.  Excluded Personal Property.The Personal Property excludes all furniture, equipment, racking and storagesystems, inventory, objects of art and other personal property not describedunder Section 1.01(d).

ARTICLE II

Purchase Price

Section2.01.          Purchase Price.  Thepurchase price (the “Purchase Price”) is an amount equal to TWENTYSIX MILLION AND NO/100 DOLLARS ($26,000,000.00).  The Purchase Price will be paid by Purchaserto Seller at the Closing (as hereinafter defined) in cash or other immediatelyavailable wire transferred funds.

Section2.02.          Escrow Holder.  Purchaserwill deposit the amount the Purchase Price with Fidelity National TitleInsurance Company — Helen Fonville (the “Escrow Agent”) in sufficienttime to ensure that the amount of the Purchase Price, plus Purchaser’s share ofprorations and expenses, are immediately available to the Escrow Agent at theClosing.  The Escrow Agent must hold thePurchase Price in an interest-bearing account at a federally insured bankinginstitution acceptable to Purchaser and Seller, with all interest being paid toPurchaser or Seller, as the case may be, in accordance with the terms of thisContract.

ARTICLE III

Review Items

Section3.01.            Survey.  Prior to execution of this Contract,Purchaser approved a new or recertified survey of the Real Property and theImprovements (the “Survey”).  Ifthe legal description on the Survey differs from that attached hereto as ExhibitA, Seller agrees to execute a “quitclaim deed” to Purchaser conveyingwhatever interest Seller might own in the legal description contained on theSurvey.

Section3.02.          Title Review Items.  Priorto execution of this Contract, Purchaser approved the preliminary title reportof the Property (the “Title Report”), issued by the Fidelity 

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National TitleCompany (the “Title Company”) attached hereto as Exhibit G, togetherwith legible copies of all items, matters, and documents referred to in theTitle Report.

Section 3.03.          Other Review Items.

(a)           Property Information.  Prior to execution of this Contract, Sellerhas delivered to Purchaser copies of the documents described in Schedule 3.03which are in Seller’s possession or control (collectively, the “PropertyInformation”), the receipt of which is hereby acknowledged by Purchaser.

(b)           Release of Seller.  Except as set forth in this Contract, andwhether Purchaser avails itself of the opportunity to review the PropertyInformation, Purchaser expressly acknowledges that the Property Information hasbeen made available to Purchaser solely as a courtesy and without anyrepresentation or warranty of any kind. As part of any election by Purchaser to accept and use the PropertyInformation as such use is defined herein, and as consideration for Seller’sexecution of this Contract and agreement to make the Property Informationavailable to Purchaser, Purchaser hereby unconditionally and irrevocably waivesany and all actual or potential rights, and releases Seller from any and allclaims, causes of action or demands Purchaser might have against Sellerregarding any form of warranty, express or implied, of any kind or type, relatingto the Property, including without limitation, any liability under theComprehensive Environmental Response, Compensation & Liability Act (“CERCLA”or “Superfund”) or state equivalents. Such waiver is absolute, complete, total and unlimited in everyway.  Such waiver includes, but is notlimited to, a waiver of express warranties, implied warranties, strictliability rights and claims of every kind and type regarding the PropertyInformation and/or the physical and/or environmental condition of the Propertywhich were not or are not discoverable, and all other existing or later createdor conceived of strict liability or strict liability type claims and rightsregarding the Property Information and/or environmental condition of theProperty.  Without limiting thegenerality of the foregoing and except with respect to Seller’s expressrepresentations, warranties and covenants contained in this Contract, Purchasercompletely, irrevocably and unconditionally releases and forever dischargesSeller of and from any and all claims and demands whatsoever, in law or equity,whether such claims are presently known or unknown, direct or indirect, fixedor contingent, which Purchaser has had, now has or may claim to have againstSeller caused by or arising out of the presence or effect of hazardous or toxicsubstances on, in or under the Property or any other environmental conditionthereon, or the provision of the Property Information and other information toPurchaser.  **Nothingcontained herein (including the foregoing release) shall apply to, or otherwiserelease Natrol (as hereinafter defined) from any liability under, the NatrolLeases (as hereinafter defined).**

(c)           Adequacy of Opportunity to Inspect.  Purchaser and Seller acknowledge and agreethat, pursuant to that certain Agreement Concerning Property dated as of March5, 2007 (the “Agreement Concerning Property”), Purchaser has conductedits due diligence investigation of the property, and based thereon has approvedsame and has 

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executed and delivered this Contract.  Therefore, Purchaser has had time to conductdue diligence with regard to the Property Information, the environmentalcondition of the Property, the physical condition of the Property, and allmatters relating to zoning, construction, utilities, permits, plans, permitteduses of the Property, the status of title, and applicable laws, and hasapproved same in all respects.  Except asset forth in this Contract, no representations, inducements, promises, agreements,assurances, oral or written, concerning the Property, the Property Information,or any aspect of applicable law, have been made by Seller, or relied upon byPurchaser.

(d)           No Seller Liability re PropertyInformation.  Purchaser acknowledgesthat the Property Information and any other information delivered by Seller toPurchaser, and any and all other matters concerning the condition, suitability,integrity, compliance with law, or other attributes or aspects of the PropertyInformation and the Property, has been furnished to Purchaser solely as acourtesy, and that, except as otherwise provided in this Contract, Sellerassumes no responsibility or liability for the accuracy, adequacy orcompleteness of the investigations upon which the Property Information and/orany other information is based, and specifically disclaims any liability forthe use of or reliance on any of the Property Information or other information.

(e)           No Verification.  Purchaser acknowledges that Seller has takenno action on Purchaser’s behalf to verify the accuracy, adequacy orcompleteness of the investigations upon which the Property Information or anyother information is based and/or any statements or other information set forththerein, of any statements or other information contained in the PropertyInformation or other information, nor any method used to compile theinformation in the Property Information or other information, nor thequalifications of the person(s) preparing such Property Information or otherinformation.

(f)            No Representation of Accuracy;Confidentiality.  Seller gives norepresentation or warranty as to, and assumes no responsibility for, theaccuracy or completeness of the Property Information, except as otherwiseprovided in this Contract.  The PropertyInformation, other information and associated items and contents made availablepursuant to this Agreement other than instruments that are a matter of publicrecord, shall be defined herein as “Confidential Information” despitewhether such Property Information, other information or associated items andcontents are so specifically identified by Seller.  Without Seller’s prior written consent,Purchaser (i) shall not divulge to any third party, including but not limitedto any governmental agency, any of the Confidential Information and shall notuse the Confidential Information in Purchaser’s business, except in connectionwith the evaluation of the Property or the specific transaction; (ii) shallensure that the Confidential Information is disclosed only to such of Purchaser’sofficers, directors, employees, consultants, investors and lenders as haveactual need for the Confidential Information in evaluation the Property; and(iii) shall use commercially reasonable efforts to prevent any furtherdisclosure of the Confidential Information. Purchaser’s covenants and agreement contained in this Section 3.03(f)shall terminate and be of no further force or effect from and after Purchaser’sacquisition of the Property and the Closing.

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ARTICLE IV

Seller’s Obligation to Remove Certain Liens.

Section4.01.          Seller’s Obligation toRemove Certain Liens. Notwithstanding anything else to the contrary in this Contract, Sellermust in any and all events remove at or prior to the Closing any deed of trustliens created, suffered or incurred against the Property by Seller, and Seller’sfailure or refusal to remove same shall be a default under this Contract.

ARTICLE V

Good and Marketable Title

Section5.01.          Conveyance.  Atthe Closing, Seller will convey fee simple title to the Real Property and theImprovements to Purchaser by the Deed and title to the Personal Property andthe Intangible Property by the Bill of Sale (as hereinafter defined), free andclear of any and all deeds of trust, mortgages or other liens or indebtedness,encumbrances, conditions, easements, rights-of-way, assessments andrestrictions, except for the exceptions reflected in the Title Report and onthe Survey (collectively, the “Permitted Exceptions”).

Section5.02.          Owner Policy.  Atthe Closing, Seller shall deliver to Purchaser, at Seller’s sole cost andexpense, an CLTA Form Owner Policy of Title Insurance (the “Owner Policy”)issued by the Title Company in Purchaser’s favor in the amount of the PurchasePrice, insuring Purchaser’s fee simple title to the Property subject only tothe Permitted Exceptions.  Purchaser hasthe right, at Purchaser’s cost, to request that the Owner Policy include ALTAextended coverage, together with such endorsements as Purchaser reasonablydeems necessary.

ARTICLE VI

Closing

Section6.01.          Closing.  Thepurchase and sale of the Property (the “Closing”) will be held throughescrow at the Escrow Agent’s offices, and will occur, subject to satisfactionof all conditions precedent set forth in this Contract, at 11:00 a.m. LosAngeles, California, time on the third (3rd) business day following theEffective Date (the “Closing Date”).  Seller shall have the one-time right, bydelivery of written notice to Purchaser prior to the Effective Date (whichnotice, in order to be effective, must be accompanied by an original of thisContract signed by Seller), to extend the Closing Date in order to accommodatethe schedule for Seller’s defeasance of the existing liens against theProperty, but in no event shall Seller have the right to extend the ClosingDate in excess of thirty (30) days beyond the originally scheduled ClosingDate.

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Section6.02.          Seller’s Obligations.  Atthe Closing, Seller shall execute and deliver to Purchaser, and/or cause theexecution and delivery by all parties other than Purchaser of, the following:

(a)           That certain grant deed (the “Deed”)in the form attached hereto as Exhibit B and made a part hereof forall purposes.

(b)           That certain blanket conveyance, billof sale and assignment (“Bill of Sale”) in the form attachedhereto as Exhibit C and made a part hereof for all purposes, whichBill of Sale also includes an assignment of that certain StandardIndustrial/Commercial Multi-Tenant Lease-Net dated December 21, 2006 (the “CurrieLease”), by and between NRE II, as landlord and Currie Technologies, Inc.,a Nevada corporation (“Currie”), as tenant, and covering approximately51,309 square feet in the O Building.

(c)           That certain affidavit (the “FIRPTAAffidavit”) in the form attached hereto as Exhibit D and made apart hereof for all purposes.

(d)           To the extent necessary to permit theTitle Company to remove any exception in the Owner Policy for mechanics’ andmaterialmens’ liens and general rights of parties in possession, an affidavitas to debts and liens and parties in possession executed by Seller, made toPurchaser and the Title Company and in a form acceptable to the Title Company,along with any other items reasonably required by the Title Company.

(e)           Subject to the terms of Section 9.03,Seller’s certification that all representations and warranties made by Sellerunder this Contract are true, complete and correct in all material respects asof the Closing Date.

(f)            Those two certain leases, onecovering all of the P Building and one covering a portion of the O Building,each by and between Purchaser, as landlord and Natrol, Inc. (“Natrol”),as tenant, in the respective forms attached hereto as Exhibit E andmade a part hereof for all purposes (collectively, the “Natrol Leases”).

(g)           Appropriate evidence of Seller’sauthority to consummate the transactions contemplated by this Contract that isreasonably requested by Purchaser or the Title Company.

Section6.03.          Purchaser’s Obligations.  Atthe Closing, Purchaser shall deliver the Purchase Price to Seller in cash or bywire transfer of immediately available funds, and shall execute and deliver toSeller the following:

(a)           The Natrol Leases.

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(b)           Appropriate evidence of Purchaser’sauthority to consummate the transactions contemplated by this Contract that isreasonably requested by Seller or the Title Company.

(c)           The Bill of Sale, whichincludes an assumption of the Currie Lease, subject to the terms therein.

Section6.04.          Possession.  Possession of the Property must be deliveredby Seller to Purchaser at the Closing, subject only to the Leases and otherPermitted Exceptions.

ARTICLE VII

Closing Adjustments

Section7.01.          General Prorations.  Therewill be no proration for any taxes, assessments and operating expensesapplicable to the P Building, it being agreed that, with respect to suchportion of the Property (i) Seller is solely liable for the payment thereof asowner of the Property for the period prior to the Closing; and (ii) Natrol willbe solely liable for the payment thereof as a tenant under one of the NatrolLeases for the period from and after the Closing.  With respect to the O Building, taxes,assessments and operating expenses shall be prorated as of the Closing, withSeller being responsible for the payment thereof as owner of the Property forthe period prior to the Closing, and Purchaser being responsible for thepayment thereof for the period from and after the Closing (subject to theobligations of Natrol, as a tenant under the applicable Natrol Lease, andCurrie, as a tenant under the Currie Lease, for payment of their applicable sharethereof).  Any rent paid under the CurrieLease will be prorated at the Closing. At the Closing, Purchaser will receive a credit for the firstinstallment of Rent due under the Natrol Leases (i.e., Rent for the period fromthe Closing Date through the last day of the first full calendar monthfollowing the calendar month in which the Closing occurs; e.g., if the Closingoccurs April 28, 2007, the Rent due at the Closing would be for the periodApril 28 through May 31, 2007), together with the security deposit required tobe delivered thereunder.  If Seller hasfailed to pay any Currie Leasing Costs (as hereinafter defined), Purchaser willreceive a credit therefore at the Closing and, in such event, Purchaser will assumethe obligation to pay the amount so credited when due, release Seller from itsobligation to do so and indemnify Seller in connection therewith.  All apportionments are subject topost-closing adjustments as necessary to reflect later relevant information notavailable at the Closing and to correct any errors made at the Closing withrespect to such apportionments.  As usedherein, the term “Currie Leasing Costs” means all leasing commissions,tenant finish cost and other costs associated with the Currie Lease.

Section7.02.          Transaction Costs.  Seller shall be responsible for (a) allattorneys’ fees and expenses of counsel to Seller; (b) all costs incurred todefease or otherwise repay any liens; (c) the cost of the Owner Policy(other than any ALTA extended coverage or endorsements thereto requested byPurchaser); and (d) all State, County and local documentary stamp, transfer orother taxes payable upon the transfer of the Property.  Purchaser shall be responsible for (i) thecost of ALTA extended coverage and any Owner Policy endorsements requested byPurchaser; 

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(ii) all attorneys’fees and expenses of counsel to Purchaser; and (iii) any inspection or othercost incurred by Purchaser.  All othertransaction costs actually incurred, including, without limitation, any escrowand other charges of the Escrow Agent, and recording fees shall be apportionedin accordance with local custom for commercial sales in Los Angeles County,California and in the absence of any such custom, shall be paid one-half bySeller and one-half by Purchaser.

Section7.03.          Brokerage Commissions.  Atthe Closing, Seller agrees to pay any and all fees or other commissions due andpayable to CB Richard Ellis, Inc. (“Broker”) in connection with thetransactions described herein pursuant to a separate written agreement betweenSeller and Broker.  Seller agrees toindemnify, protect, defend and hold Purchaser harmless from and against allclaims by Broker, or any person claiming by through or under Broker, for suchfees or commissions.  Except for Broker,Seller and Purchaser acknowledge and agree that neither has dealt with anyother real estate broker, agent or salesman, and any other fees or real estatecommissions occasioned by the execution and/or consummation of this Contractshall be the sole responsibility of the party contracting therefor (or allegedto have contracted for), and such party agrees to indemnify, protect, defendand hold harmless the other party from any and all claims for such other feesor real estate commissions.

Section7.04.          Survival.  Theterms of Section 7.01 and Section 7.03 shall survive the termination of thisContract on the Closing and delivery of the Deed.

ARTICLE VIII

Termination and Remedies

Section8.01.          Purchaser’s Default.  IfPurchaser fails to close for any reason, except Seller’s default or thepermitted termination of this Contract by Purchaser or Seller as hereinexpressly provided, Seller shall be entitled, as Seller’s sole and exclusiveremedy, to terminate this Contract and require that Purchaser pay to Seller thesum of Five Hundred Thousand Dollars ($500,000.00), within two (2) businessdays after such termination.  Seller andPurchaser acknowledge and agree that delivery of said sum by Purchaser shall bedeemed liquidated damages for Purchaser’s failure to close escrow in breach ofthis Contract, it being further agreed that the actual damages to Seller in theevent of such breach are impractical to ascertain and said sum is a reasonableestimate thereof.  Seller has no right tospecifically enforce Purchaser’s obligations under this Contract nor to seek orotherwise collect any actual, out-of-pocket, lost profit, punitive,consequential, treble, or other damages from or against Purchaser.  In no event shall any officer, director oremployee of Purchaser or its partners be personally liable for any of Purchaser’sobligations under this Contract or the documents to be delivered at theClosing.  This Section 8.01 shall notlimit Seller’s remedies for Purchaser’s breach of any other covenant of thisContract which expressly survives the termination hereof; provided, however, inno event shall Purchaser be liable for any punitive or consequentialdamages.  If said liquidated damages are not paid by Purchaser whendue, Seller shall, in addition to Seller’s other rights and remedies, beentitled to interest thereon at the rate of 10% per annum from the date due until the date paid.

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Section8.02.          Seller’s Default.  IfSeller fails to close for any reason, except Purchaser’s default or thepermitted termination of this Contract by either Seller or Purchaser (otherthan under this Section 8.02) as herein expressly provided, Purchaser shall beentitled to either (a) terminate this Contract upon written notice to Sellerand to request the Escrow Agent to return the Purchase Price, together with allaccrued interest thereon, to Purchaser or (b) pursue an action to enforcespecific performance of Seller’s obligations under this Contract.  Purchaser has no right, except as provided inthe next sentence, to seek damages against Seller.  If Seller’s default is willful, Purchasermay, in lieu of specific performance (but not in lieu of the return of thePurchase Price), collect its actual out-of-pocket damages from Seller, not toexceed $100,000.  In no event shall anyofficer, director, agent or employee of Seller be personally liable for any ofSeller’s obligations under this Contract or the documents to be delivered atthe Closing.  This Section 8.02 shall notlimit Purchaser’s remedies for Seller’s breach of any other covenant of thisContract which expressly survives the termination hereof; provided, however, inno event shall Seller be liable for any punitive or consequential damages.

ARTICLE IX

Representations, Warranties and Covenants

Section9.01.          Seller’s Representations.  Sellerhereby represents and warrants to Purchaser, as of the date hereof and as ofthe Closing Date, except as set forth in that certain schedule (the “Disclosure Schedule”)attached hereto as Exhibit F and made a part hereof for allpurposes (which shall be deemed to include all Property Information actuallydelivered to Purchaser under Section 3.03 and made available to Purchaser underSection 3.04), as follows:

(a)           Seller has no knowledge of any aspector condition of the Property which materially violates applicable laws,regulations, codes or covenants, conditions or restrictions, or of improvementsor alterations made without a permit where one was required, or of anyunfulfilled or directive of any applicable governmental agency requiring anyinvestigation, remediation, repair, maintenance or improvement to be performedto the Property.

(b)           There is, to Seller’s knowledge, nopending or threatened litigation, arbitration, governmental inquiry, claim,condemnation or sale in lieu thereof, that would affect the Property or theright to use, lease or otherwise operate same.

(c)           Except as reflected in the TitleReport, Seller has received no notice and has no knowledge of any pendingpublic improvements, liens or special assessments to be made in respect of, orassessed against, the Property by any governmental authority.

(d)           Seller has made delivered orotherwise made available to Purchaser true, complete and correct copies of allmaterial agreements affecting the Property or any portion thereof.  Seller is not in material default under anysuch agreements, nor is there, to Seller’s knowledge, any condition or factwhich with notice or passage of time, or both, would constitute a default bySeller thereunder.  An affiliate ofSeller currently 

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occupies a portion of the Property.  Except for the Currie Lease and the NatrolLeases, no leases will be in effect at the Property upon the Closing.

(e)           To Seller’s knowledge, theinformation made available to Purchaser in accordance with Section 3.03 iscorrect in all material respects and viewed as a whole, reflects accurately, inall material respects, the actual history of ownership and operation of theProperty during the respective periods of time covered thereby.

(f)            There are no attachments,executions, assignments for the benefit of creditors or voluntary orinvoluntary proceedings in bankruptcy pending against or contemplated by Selleror otherwise applicable to the Property, and to Seller’s knowledge no suchactions have been threatened.

(g)           Each entitycomprising Seller is a corporation, duly organized, validly existing and ingood standing under the laws of the State of California, and has all requisitepower and authority to execute, deliver and perform under this Contract and tocarry on its business as now conducted. Neither the execution and delivery of this Contract by Seller nor Seller’sperformance of its obligations hereunder will result in a violation or breachof any term or provision or constitute a default or accelerate the performancerequired under any other agreement or document to which Seller is a party or isotherwise bound or to which the Property, or any part thereof, is subject andwill not constitute a violation of any law, ruling, regulation or order towhich Seller is subject.  This Contractconstitutes a valid and binding obligation of Seller enforceable in accordancewith its terms, except as such enforceability may be limited by bankruptcy,insolvency, reorganization, moratorium or similar laws of general applicationaffecting the rights and remedies of creditors. The Knowledge Parties (as hereinafter defined) are those representativesof Seller primarily responsible for Seller’s operation of the Property and, assuch, are those Seller’s representatives most likely to know whether and towhat extent the representations set forth herein are true, complete andcorrect.

(h)           No person, firm or corporation orother entity has any right or option to acquire fee title to the Property, orany part thereof.

(i)            Seller is neither a “foreign person”nor a “foreign corporation” as those terms are defined in Section 7701 of theInternal Revenue Code of 1986, as amended.

(j)            The Property is taxed separatelyfrom all other property.

(m)          Except as otherwise disclosed in theProperty Information made available to Purchaser pursuant to Section 3.03 andSection 3.04, Seller has no knowledge of the existence or prior existence onthe Property of any hazardous substance, nor the existence on the Property ofany above or below ground storage tank.

WHENEVER REFERENCEIS MADE IN THIS CONTRACT TO THE KNOWLEDGE OF SELLER SUCH REFERENCE SHALL BEDEEMED LIMITED TO THE ACTUAL 

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KNOWLEDGE OFDENNIS R. JOLICOEUR AND MICHAEL BEAN (THE “KNOWLEDGE PARTIES”) AND SHALLEXPRESSLY EXCLUDE ANY CONSTRUCTIVE KNOWLEDGE, AND ANY KNOWLEDGE WHICH COULD BEIMPUTED TO THE KNOWLEDGE PARTIES. PURCHASER ACKNOWLEDGES THAT THE KNOWLEDGE PARTIES HAVE NOT UNDERTAKENANY INDEPENDENT INVESTIGATION WITH RESPECT TO THE MATTERS SET FORTH IN THISCONTRACT.  PURCHASER AGREES THAT IT HASINSPECTED AND WILL CONTINUE TO INSPECT AND ASSESS THE PROPERTY DURING THEREVIEW PERIOD AND THAT PURCHASER WILL RELY SOLELY UPON SUCH INSPECTION ANDASSESSMENT IN ELECTING WHETHER OR NOT TO PURCHASE THE PROPERTY.  IT IS UNDERSTOOD AND AGREED BY SELLER ANDPURCHASER THAT, IN ADDITION TO THE RELEASE SET FORTH IN SECTION 3.01(B),PURCHASER IS PURCHASING THE PROPERTY “AS IS” AND “WHERE IS”, AND WITH ALLFAULTS AND DEFECTS, LATENT OR OTHERWISE, AND, EXCEPT AS EXPRESSLY SET FORTH INTHIS CONTRACT AND THE CLOSING DOCUMENTS, SELLER IS MAKING NO REPRESENTATIONS ORWARRANTIES, EXPRESS OR IMPLIED, BY OPERATION OF LAW OF OTHERWISE, WITH RESPECTTO THE QUALITY, PHYSICAL CONDITION ENVIRONMENTAL CONDITION, ZONING,ENTITLEMENTS, OCCUPANCY, COMPLIANCE WITH LAW, STATUS OF TITLE, VALUE OR ANYOTHER MATTER CONCERNING OR RELATING TO THE PROPERTY, AND PURCHASER IS NOTRELYING UPON ANY REPRESENTATIONS OR WARRANTIES NOT SET FORTH IN THISCONTRACT.  IN ADDITION TO AND NOT INLIMITATION OF THE FOREGOING, IT IS UNDERSTOOD AND AGREED BY SELLER ANDPURCHASER THAT SELLER MAKES NO WARRANTY OF HABITABILITY, SUITABILITY,MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE OR FITNESS FOR ANY PURPOSEWITH REGARD TO THE PROPERTY.  PURCHASERRECOGNIZES, STIPULATES AND AGREES THAT THE PROVISIONS OF THIS SECTION ARE AMATERIAL INDUCEMENT TO SELLER IN CONNECTION WITH THE EXECUTION OF THIS CONTRACTAND THE CONSUMMATION OF THE TRANSACTIONS CONTEMPLATED HEREBY AND THAT, BUT FORTHE PROVISIONS OF THIS SECTION, SELLER WOULD NOT HAVE EXECUTED THIS CONTRACT ORAGREED TO SELL THE PROPERTY ON THE TERMS AND CONDITIONS CONTAINED HEREIN.  THE PROVISIONS OF THIS SECTION SHALL SURVIVETHE CLOSING.

PURCHASER HEREBYACKNOWLEDGES THAT PURCHASER HAS READ AND IS FAMILIAR WITH THE PROVISIONS OFCALIFORNIA CIVIL CODE SECTION 1542 (“SECTION1542”), WHICH IS SET FORTH BELOW:

“A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOESNOT KNOW OR SUSPECT TO EXIST IN HIS FAVOR AT THE TIME OF EXECUTING THE RELEASE,WHICH IF KNOWN BY HIM MUST HAVE MATERIALLY AFFECTED HIS SETTLEMENT WITH THEDEBTOR.”

BY INITIALING BELOW, PURCHASER HEREBY WAIVES THE PROVISIONS OFSECTION 1542 SOLELY IN CONNECTION WITH THE MATTERS WHICH ARE THE SUBJECTOF THE FOREGOING WAIVERS AND RELEASES.

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J P R

PURCHASER’SINITIALS

 

NOTWITHSTANDING ANYTHING HEREIN TO THECONTRARY, (A) PURCHASER HAS NOT RELEASED SELLER FROM AND SELLER SHALL REMAINLIABLE FOR, ANY FRAUD BY SELLER OR ANY BREACH BY SELLER OF ANY REPRESENTATION,WARRANTY, COVENANT OR INDEMNITY SET FORTH HEREIN OR IN ANY CLOSING DOCUMENTWHICH SURVIVES THE CLOSING; AND (B) SELLER ACKNOWLEDGES AND AGREES THATPURCHASER HAS NOT ASSUMED, AND HAS NO OBLIGATION TO INDEMNIFY SELLER FOR, ANYGOVERNMENT OR THIRD PARTY CLAIM ASSERTED AGAINST SELLER AFTER THE CLOSING TOTHE EXTENT APPLICABLE TO AN ACT OR OMISSION TAKEN OR FAILED TO BE TAKEN PRIORTO THE CLOSING.  THE PROVISIONS OFTHIS SECTION SHALL SURVIVE THE CLOSING.

Section9.02.          Purchaser’s Representations.  Purchaserhereby represents and warrants to Seller, as of the date hereof and as of theClosing Date, as follows:

(a)           Purchaser is a limited liabilitycompany, duly organized, validly existing and in good standing under the lawsof the State of Delaware, and has all requisite power and authority to carry onits business as now conducted.

(b)           Purchaser has the capacity and completeauthority to enter into and perform this Contract, and no consent, approval orother action by any person or entity (other than the person signing thisContract on behalf of Purchaser and any approval to be obtained by Purchaserduring the Review Period) will be needed thereafter to authorize Purchaser’sexecution and performance of this Contract.

Section9.03.          Discovery.  Ifeither Seller or Purchaser discovers, prior to or at the Closing, that anyrepresentation or warranty of the other party is false, misleading orinaccurate in any material respect, the discovering party may, at its option,terminate this Contract and the parties hereto shall be relieved of allliabilities and obligations hereunder and (a) if Purchaser is the discoveringparty, Purchaser shall be entitled to the immediate return of the PurchasePrice, together with all accrued interest thereon, and to pursue its remediesunder Section 8.02 of this Contract; and (b) if Seller is the discoveringparty, Seller shall be entitled to pursue its remedies under Section 8.01 ofthis Contract.  If the party discoveringthat the other party’s representation or warranty is inaccurate elects to closethe transaction, then the discovering party shall be deemed to have waived anybreach by the other party as a result of the inaccuracy of its representationor warranty, and clause (A) of the last paragraph of Section 9.01(A) shall beinapplicable thereto.  Representationsand warranties under this Article IX shall fully survive the Closing and thedelivery of the Deed, but to the extent that neither Seller nor Purchaser hasmade any claim as to the breach of any such representation or warranty withintwelve (12) months after the Closing Date, such representations and warrantieswill terminate and be of no further force and effect.

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Section9.04.          Operating Covenants.  Selleragrees to operate and maintain the Property prior to the Closing in a mannerconsistent with its current operating procedures and applicable legalrequirements and, after the Effective Date, shall not, without the priorwritten consent of Purchaser (not to be unreasonably withheld or delayed), doany of the following:

(a)           Enter into any contract with respectto Seller’s ownership of the Property that will not be fully performed by Selleron or before the Closing Date or that will not be susceptible of cancellationby Purchaser on or after the Closing Date upon thirty (30) days or less priorwritten notice, without cost or liability to Purchaser, or amend, modify orsupplement any existing contract or agreement in any material respect.

(b)           Enter into any lease (other than theNatrol Leases at the Closing) or amend, modify, supplement or terminate theCurrie Lease or any other existing lease.

(c)           Fail to maintain Seller’s currentpolicies of insurance covering Seller’s interest in the Property or advisePurchaser promptly of the occurrence of any fire or other casualty affectingthe Property.

(d)           Until Purchaser terminates thisContract for any reason other than Seller’s default, sell, assign or create anyright, title or interest whatsoever in or to the Property (excluding executionany so-called “backup contracts” or letters of intent which are expresslymade subordinate to this Contract, but not otherwise) or create or permit toexist any lien, encumbrance or charge thereon, other than liens or encumbrancesnoted in the Title Report, without promptly discharging same or otherwisecomplying with the terms of Section 4.04.

(e)           Take any action, or omit to take anyaction, which action or omission would have the effect of violating in anymaterial respect any of the representations and warranties of Seller containedin this Contract.

Section9.05.          Conditions Precedent.  Purchaser is not obligated to perform underthis Contract unless all of the following conditions precedent are satisfied(or waived in writing by Purchaser) and are otherwise true and correct as ofthe Closing Date:

(a)           There has been no material adversechange in the matters reflected in the Title Report, the Survey, the operatingstatements or the other items delivered to Purchaser hereunder since theexpiration of Purchaser’s “Review Period” under the Agreement ConcerningProperty, except to reflect those items approved or otherwise created inwriting by Purchaser.

(b)           All of Seller’s representations andwarranties are true and correct in all material respects.

(c)           Seller has performed all of itscovenants, agreements, and obligations under this Contract and is otherwise notin default.

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(d)           Currie executes and delivers an estoppelcertificate addressed to Seller and Purchaser and otherwise in the formrequired by paragraph 16 of the Currie Lease which and which confirms, amongother matters, that the rent commencement date has occurred and that Currie hasno default, offset or other claims against Seller under the Currie Lease.

Notwithstandingthe generality of the foregoing, Seller shall use its reasonable efforts tosatisfy all of the foregoing conditions precedent.  If Seller is unable to satisfy all of theforegoing conditions precedent, Purchaser may waive any unsatisfied conditionsprecedent, extend the Closing Date or terminate this Contract, in any suchevent by written notice to Seller. Seller shall have no liability to Purchaser if, after reasonableefforts, Seller is unable to satisfy any closing conditions, unless theinability is due to a default by Seller. If Seller is unable to satisfy all of the foregoing conditions precedentdue to a default by Seller, Purchaser may pursue its rights and remedies underSection 8.02.

ARTICLE X

Notices

Section10.01.        Notices.  Any notice, demand or other communicationwhich may or is required to be given under this Contract must be in writing andmust be:  (a) personally delivered; (b)transmitted by United States postage prepaid mail, registered or certifiedmail, return receipt requested; (c) transmitted by reputable overnight courierservice, such as Federal Express; or (d) transmitted by legible facsimile (withanswer back confirmation) to Purchaser and Seller as listed below.  Except as otherwise specified herein, allnotices and other communications shall be deemed to have been duly given on (i)the date of receipt if delivered personally, (ii) two (2) business days afterthe date of posting if transmitted by registered or certified mail, returnreceipt requested, (iii) the first (1st) business day after the date ofdeposit, if transmitted by reputable overnight courier service, or (iv) thedate of transmission with confirmed answer back if transmitted by facsimile,whichever shall first occur.  A notice orother communication not given as herein provided shall only be deemed given ifand when such notice or communication and any specified copies are actuallyreceived in writing by the party and all other persons to whom they are requiredor permitted to be given.  Purchaser andSeller may change its address for purposes hereof by notice given to the otherparties in accordance with the provisions of this Section.  Notices hereunder shall be directed asfollows:
| If to Purchaser: | c/o TA Associates Realty              |
|------------------|---------------------------------------|
|             | 1301 Dove Street, Suite 860           |
|             | Newport Beach, California 926600-2109 |
|             | Attention: Douglas M. Engelman        |
|             | Telephone: (949) 852-2030             |
|             | Facsimile: (949) 852-2031             |

 

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| With a copy to: | Stutzman, Bromberg, Esserman & Plifka,     |
|-----------------|------------------------------------------------|
|            | A Professional Corporation                     |
|            | 2323 Bryan Street, Suite 2200                  |
|            | Dallas, Texas 75201                            |
|            | Attention: Kenneth F. Plifka                   |
|            | Telephone: (214) 969-4900                      |
|            | Facsimile: (214) 969-4999                      |
|            |                                           |
| If to Seller:   | Natrol Real Estate, Inc.                       |
|            | Natrol Real Estate II, Inc.                    |
|            | c/o Natrol, Inc.                               |
|            | 21411 Prairie Street                           |
|            | Chatsworth, California 91311                   |
|            | Attention: Steven Spitz, Esq., General Counsel |
|            | Telephone: (818) 739-6000, ext. 199            |
|            | Facsimile: (818) 739-6032                      |
|            |                                           |
| With copies to: | John A. Rosenfeld                              |
|            | Post Office Box 1308                           |
|            | Topanga, California 90290                      |
|            | Telephone: (310) 455-9718                      |
|            | Facsimile: (310) 455-9768                      |

 

ARTICLE XI

Risk of Loss

Section11.01.        Minor Damage.  Inthe event of “minor” loss or damage [being defined for the purpose of thisContract as damage to the Property such that the Property could be repaired orrestored, in the opinion of an architect mutually acceptable to Seller andPurchaser (with any fees, costs or expenses pertaining to such opinion to beborne equally by Purchaser and Seller), to a condition substantially identicalto that of the Property immediately prior to the event of damage at a costequal to or less than $100,000], neither Seller nor Purchaser shall have theright to terminate this Contract due to such damage but Seller shall, atPurchaser’s option as expressed to Seller in writing, either (a) reduce thePurchase Price by an amount equal to the cost to repair such damage, or (b)repair and restore the damaged portion of the Property to a conditionsubstantially identical to that which existed immediately prior to theoccurrence of such damage and in either such event Seller shall retain all ofSeller’s right, title and interest to any claims and proceeds Seller may havewith respect to any casualty insurance policies relating to the Property.  If Purchaser elects to have Seller repair andrestore the damaged portion of the Property, Seller shall act promptly anddiligently to complete such repairs in a good and workmanlike manner and shallcomplete such repairs prior to the Closing Date if reasonably possible.

Section11.02.        Major Damage.  Inthe event of a “major” loss or damage (being defined as any loss or damagewhich is not “minor” as defined hereinabove), Purchaser shall have the option 

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of terminating thisContract by written notice to Seller, in which event Seller and Purchaser shallthereupon be released from any and all liability hereunder and the PurchasePrice, together with all accrued interest thereon, shall be immediatelyreturned to Purchaser by the Escrow Agent. If Purchaser elects not to terminate this Contract, Purchaser and Sellershall proceed with the Closing, provided Seller shall assign all of Seller’sright, title and interest to any claims and proceeds Seller may have withrespect to any casualty insurance policies relating to the Property, andPurchaser shall receive a credit against the Purchase Price in an amount equalto the aggregate amount of any deductible(s) under the insurance policiesassigned to Purchaser.

Section 11.03.        Vendor and Purchaser Risk Act.  Exceptas set forth in Section 11.01 and Section 11.02, Seller shall bear the fullrisk of loss until Closing.  Upon theClosing, full risk of loss with respect to the Property shall pass toPurchaser.

Section11.04.        Condemnation.  Ifbefore the Closing any condemnation or eminent domain proceedings arethreatened or initiated against all or any portion of the Property and, in thereasonable opinion of Purchaser, such condemnation or eminent domainproceedings would materially interfere with the current use of the Property,then Purchaser may terminate this Contract upon written notice to Seller andSeller and Purchaser shall thereupon be released from any and all furtherliability hereunder and the Purchase Price, together with all accrued interestthereon, shall be immediately returned to Purchaser by the Escrow Agent.  If Purchaser does not elect to terminate thisContract within ten (10) business days after receipt of written notice of thecommencement of any such proceedings (but in any event prior to the ClosingDate), or if, in the reasonable opinion of Purchaser, such condemnation oreminent domain proceedings would not materially interfere with Seller’s currentuse of the Property, the Closing shall take place as provided herein and Sellershall assign to Purchaser at the Closing all rights and interest of Seller inand to any condemnation awards payable or to become payable on account of suchcondemnation or eminent domain proceedings.

ARTICLE XII

Miscellaneous

Section12.01.        Entire Agreement; Confidentiality.  This Contract, together with all exhibitsattached hereto and the Agreement Concerning Property, constitutes the entireagreement between the parties hereto and supersedes any prior understanding,letter of intent or written or oral agreements between the parties concerningthe Property (other than the Agreement Concerning Property).  Prior to the Closing, no press release orother publicity regarding the terms of this Contract or Purchaser’s acquisitionof the Property shall be authorized by either party without the other party’sprior written consent, which shall not be unreasonably withheld.

Section12.02.        No Rule of Construction.  ThisContract has been drafted by both Seller and Purchaser and no rule ofconstruction shall be invoked against either party with respect to theauthorship hereof or of any of the documents to be delivered by the respectiveparties at the Closing.

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Section12.03.        Multiple Counterparts;Governing Law.  This Contract may beexecuted in multiple counterparts, each of which shall be deemed an originalbut all of which together shall constitute one and the same instrument, andshall be construed and interpreted under the laws of the State of California(without regard to conflicts of laws) and all obligations of the partiescreated hereunder are performable in the County in which the Property islocated.

Section12.04.        Attorneys’ Fees.  Ifeither party brings an action or proceeding involving the Property, whetherfounded in tort, contract or equity, or to declare rights under this Contract,the Prevailing Party (as hereinafter defined) in any such action, proceeding orappeal thereon, shall be entitled to reasonable attorneys’ fees.  Such fees may be awarded in the same suit orrecovered in a separate suit, whether or not such action or proceeding ispursued to decision or judgment.  Theterm “Prevailing Party” shall include, without limitation, a party whosubstantially obtains or defeats the relief sought, as the case may be, whetherby compromise, settlement, judgment, or the abandonment by the other party ofits claim or defense. The attorneys’ fee award shall not be computed inaccordance with any court fee schedule, but shall be such as to fully reimburseall attorneys’ fees reasonably incurred.

Section12.05.        Assignment.  ThisContract may not be assigned by Purchaser without the prior written consent ofSeller; provided, however, this Contract may be assigned by Purchaser withoutthe prior written consent of Seller, to any investment advisory client ofPurchaser, including, without limitation, any entity formed on its behalf.  Purchaser will remain liable under thisContract following any such assignment. This Contract and all rights hereunder shall inure to and be bindingupon the respective heirs, personal representatives, successors and permittedassigns of Seller and Purchaser.

Section12.06.        Interpretation.  This Contract shall, unless otherwisespecified herein, be subject to the following rules of interpretation:  (a) the singular includes the plural and theplural the singular; (b) words importing any gender include the other genders;(c) references to persons or entities include their permitted successors andassigns; (d) words and terms which include a number of constituent parts, thingsor elements, including the terms Improvements, Permitted Exceptions, PersonalProperty, Intangible Property and Property, shall be construed as referringseparately to each constituent part, thing or element thereof, as well as toall of such constituent parts, things or elements as a whole; (e) references tostatutes are to be construed as including all rules and regulations adoptedpursuant to the statute referred to and all statutory provisions consolidating,amending or replacing the statute referred to; (f) references to agreements andother contractual instruments shall be deemed to include all subsequentamendments thereto or changes therein entered into in accordance with theirrespective terms; (g) the words “approve” or “consent” or “agree” orderivations of said words or words of similar import mean, unless otherwiseexpressly provided herein or therein, the prior approval, consent, or agreementin writing of the person holding the right to approve, consent or agree withrespect to the matter in question, and the words “require” or “judgment” or “satisfy”or derivations of said words or words of similar import mean the requirement,judgment or satisfaction of the person who may make a requirement or exercisejudgment or who must be satisfied, which approval, consent, agreement,requirement, judgment or satisfaction shall, unless otherwise expresslyprovided

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herein or therein,be in the sole and absolute discretion of the person holding the right toapprove, consent or agree or who may make a requirement or judgment or who mustbe satisfied; (h) the words “include” or “including” or words of similar importshall be deemed to be followed by the words “without limitation”; (i) the words“hereto” or “hereby” or “herein” or “hereof” or “hereunder,” or words ofsimilar import, refer to this Contract in its entirety; (j) references tosections, articles, paragraphs or clauses are to the sections, articles,paragraphs or clauses of this Contract; and (k) numberings and headings ofsections, articles, paragraphs and clauses are inserted as a matter ofconvenience only and shall not affect the construction of this Contract.

Section12.07.        Exhibits.  Thefollowing exhibits attached hereto shall be deemed to be an integral part ofthis Contract:
| Exhibit A | -      | legal description of the Real Property |
|----------------|--------|----------------------------------------|
|           |   |                                   |
| Exhibit B | -      | form of Deed                           |
|           |   |                                   |
| Exhibit C | -      | form of Bill of Sale                   |
|           |   |                                   |
| Exhibit D | -      | form of FIRPTA Affidavit               |
|           |   |                                   |
| Exhibit E | -      | form of Natrol Leases                  |
|           |   |                                   |
| Exhibit F | -      | Disclosure Schedule                    |

 

Section12.08.        Modifications.  ThisContract cannot be changed orally, and no executory agreement shall beeffective to waive, change, modify or discharge it in whole or in part unlesssuch executory agreement is in writing and is signed by the parties against whomenforcement of any waiver, change, modification or discharge is sought.  Any such modification need not be joined inby Broker or the Escrow Agent.

Section12.09.        Reporting Person.  Purchaser and Seller hereby designate theEscrow Agent as the “reporting person” pursuant to the provisions of Section6045(e) of the Internal Revenue Code of 1986, as amended.

Section12.10.        Time of Essence.  Time is of the essence to both Seller andPurchaser in the performance of this Contract, and they have agreed that strictcompliance by both of them is required as to any date and/or time set outherein, including, without limitation, the dates and times set forth in ArticleIV of this Contract.  If the final day ofany period of time set out in any provision of this Contract falls upon aSaturday, Sunday or a legal holiday under the laws of the State of California,then and in such event, the time of such period shall be extended to the nextday which is not a Saturday, Sunday or legal holiday.

[SEE SIGNATURES ONTHE FOLLOWING PAGES]

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IN WITNESSWHEREOF, this Contract has been executed by Purchaser and Seller as of (but notnecessarily on) the date and year first above written.
|        | PURCHASER:                           |
|--------|--------------------------------------|
|   |                                 |
|   | REALTY ASSOCIATES ADVISORS, LLC,     |
|   | a Delaware limited liability company |
|   |                                 |
|   | By:                                  | Realty Associates Advisors Trust |
|   |                                 |   |
|   |                                 |   |
|   |                                 | By: |     /s/ James P. Raisides |   |
|   |                                 | Name: | James P. Raisides |
|   |                                 | Title: | Sr. Vice President |
|        |                                      |  |  |  |  |

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|        | SELLER:                      |
|--------|------------------------------|
|   |                         |
|   | NATROL REAL ESTATE, INC.,    |
|   | a California corporation     |
|   |                         |
|   |                         |
|   | By:                          | /s/ Dennis R. Jolicoeur |   |
|   | Name:                        | Dennis R. Jolicoeur |
|   | Title:                       | CFO |
|   |                         |
|   | NATROL REAL ESTATE II, INC., |
|   | a California corporation     |
|   |                         |
|   |                         |
|   | By:                          | /s/ Dennis R. Jolicoeur |
|   | Name:                        | Dennis R. Jolicoeur |
|   | Title:                       | CFO |

 

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ESCROW AGENT JOINDER

 

TheEscrow Agent joins herein in order to evidence its agreement to perform theduties and obligations of the Escrow Agent set forth herein and theaccompanying escrow instructions and to acknowledge receipt, as of the date setforth below, of an original counterpart of this Contract signed by Seller andPurchaser.
| Date: March 29, 2007. |
|-----------------------|
|                  |
|                  |
|                  | FIDELITY NATIONAL TITLE INSURANCE COMPANY |
|                  |   |
|                  |   |
|                  | By: | /s/ Helen Fonville |   |
|                  | Name: | Helen Fonville |   |
|                  | Title: | Escrow officer |   |
|                  |   |
|                  |   |

 

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SCHEDULE 3.03

LIST OF CERTAIN DUE DILIGENCE MATERIALS

Tenant Information

1.                                       FinancialStatements – Three (3) full fiscal years plus current year-to-date financialstatements for Natrol, Inc., as well as those financial statements for Currieas can be requested by under the Currie Lease).

Operating Information

2.                                       Ifin Seller’s possession, copies of certificates of occupancy for the buildingshells and copies of certificates of occupancy and/or building permits for alltenant improvements and operating permits, licenses and certificates.

3.                                       Listingof capital expenditures and operating expenses for the Property for the priorthree (3) years.

4.                                       Ifin Seller’s possession, copies of all service, maintenance, leasing, managementor other contracts and all other agreements, warranties and guaranties relatingto the operation, use, management or maintenance of the Property, including anyamendments and/or letter agreements pertaining to each.

5.                                       Copiesof all real estate tax bills (including special assessments) for the Propertyfor the prior three (3) years.

Building Information

6.                                       Ifin Seller’s possession, final “as built” shell, electrical, mechanical andstructural plans and specifications for the Property, including for all tenantimprovements, and, to the extent that any portion of the Property is underconstruction as of the Closing Date, any and all plans, specifications andconstruction contracts or agreements related thereto.

7.                                       Listof personal property to be transferred to Buyer.

8.                                       PropertyCondition Reports – All reports in Seller’s possession accessing the physicaland structural condition of the Property and Property components including,without limitation:  Engineering,Structural, Seismographic, Geotechnical, Mechanical, Roof, Environmental,Fire/Life/Safety, Air Quality Investigations; and ADA reports.

9.                                       Survey– Most recent property survey in Seller’s possession.

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10.                                 BuildingPlans – If in Seller’s possession, comprehensive set of “As Built” plansincluding all specialty plan subsets: Architectural, Structural, Mechanical, Plumbing, Electrical, Roof, andLandscape plans.

11.                                 OperatingPermits, Licenses & Certifications – Copies of all licenses, permits,certifications, and other authorizations required for onsite operations inSeller’s possession, including, without limitation, Sprinkler Certification(s),Fire Alarm Certification(s), Elevator Permits, Boiler Permit(s), GeneratorPermit(s), Infra-red Electrical Test(s), Fire Pump Permit(s), UST Permit(s),Back-Flow Certification(s), Swing State License(s), etc.

12.                                 HVACMaintenance Logs – To the extent in Seller’s possession, historical periodicHVAC maintenance reports for the two (2) years, including (to the extentavailable) comprehensive inventory of all mechanical systems units statingmanufacturer, make/model, capacity, age, condition and estimated remaininguseful life.

Miscellaneous

13.                                 Ifin Seller’s possession, copies of any notices of violations of any federal,state, municipal or health, fire, building, zoning, safety, environmental protectionor other applicable codes, laws, rules, regulations or ordinances relating orapplying to the Property.

14.                                 Listof all litigation pending against the Property or against the Seller whichrelates to the Property.

15.                                 Non-RecordedEncumbrances – Copies of any miscellaneous non-recorded encumbrances on theProperty in Seller’s possession, if any, including, without limitation:  CC&Rs, Association Documents, ReciprocalEasements, Reciprocal Access Agreements, Ground Leases, etc.

16.                                 PropertyLoss History Report – Property loss history report (three years) prepared andsubmitted by Seller’s Property Casualty and Liability insurance carrier(s).

17.                                 OccupantComplaints – Seller to prepare brief history identifying all material occupant,visitor, or employee complaints reported to ownership with the past three (3)years including, but not limited to: water intrusion, unpleasant odors, building or site hazards, indoor airquality, building-related health concerns, property safety, property crime,general nuisances, etc.

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EXHIBIT A

LEGAL DESCRIPTION

Parcel 1:

 

Lots 7, 8, 9 and 10 of Tract No. 33150, in the City or Los Angeles,County of Los Angeles, State of California, as per map filed in Book 910, Pages63 to 65, inclusive of Maps, in the office of the County Recorder of saidcounty.

 

Except from that portion of said land lying Westerly of the Westerlylines of Lots 5 and 8 of Tract No. 22917, as per map recorded in Book 638,Pages 3 to 66 of maps, all oil, asphaltum, petroleum, natural gas and otherhydrocarbons and other valuable mineral substances and products and all otherminerals whether or not of the same character herein before described generallyin, under or upon said land, but without the right to enter upon the surface ofsaid land and the subsurface lying above a depth of 500 feet below the surfacethereof, to mine, excavate, bore, drill and sink and otherwise collect anddevelop said oils, petroleum, asphaltum, natural gas or other hydrocarbons orother valuable mineral substances and products or any other mineral or minerals(whether of the same character hereinabove described generally or not) and alsoto remove and sell said oil, asphaltum natural gas or other hydrocarbons orother valuable mineral substances and products or other mineral or minerals, asgranted to Porter Sesnon, Barbara Sesnon Cartan, William T. Sesnon, Jr. to eachan undivided one-third interest as tenants in common, as the separate property,of each, by deed recorded December 14, 1951 in Book 37855, Page 1, OfficialRecords and recorded November 3, 1952 in Book 40220, Page 377, Official Recordsand as quitclaimed by deed dated September 2, 1959 executed by Porter Sesnon,Barbara Sesnon Cartan and William T. Sesnon, Jr., to the then record ownerrecorded September 14, 1959 in Book D-600, Page 923, Official Records asInstrument No. 3561.

 

Parcel 2:

 

A Non-Exclusive Easement for Vehicular Staging, Ingress and Egress overa portion of Lot 4 of Tract No. 33150 in the City of Los Angeles, County of LosAngeles, State of California, as per map filed in Book 910 Pages 63 through 65inclusive of Maps, in the office of the County Recorder of said county, theeasement lying 15.00 feet southerly, measured at right angles, to the followingdescribed line:

 

Commencing at the southwesterly corner of Lot 7 of said Tract No.33150, said corner also being the northwesterly corner of said Lot 4; ThenceSouth 89° 59’ 39’ East along the southerly line of said Lot 7 and the northerlyline of said Lot 4, 113.00 to the True Point of Beginning; Thence continuingalong said last mentioned line South 89°59 '39'east 311.32 feet to the Point ofTermination, said point also being North 89° 59’ 39’ West, 148.00 feet from thesoutheasterly corner of Lot 9 and the northeasterly corner of said Tract No.33150.

 

Assessor’s Parcel No: 2746-014-018

 

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The Easterly 130 feet ofLot 2 and Lot 3 of Tract No. 33150, in the City of Los Angeles, County of LosAngeles, State or California, as per map filed in Book 910, Pages 63 to 65,inclusive of Maps, in the office of the County Recorder of said county.

Except from that portionof said land lying Westerly of the Westerly lines of Lots 5 and 8 of Tract No.22917, as per map recorded in Book 638, Pages 3 to 66 of maps, all oilasphaltum, petroleum, natural gas and other hydrocarbons and other valuablemineral substances and products and all other minerals whether or not of thesame character herein before described generally in, under or upon said land,but without the right to enter upon the surface of said land and the subsurfacelying above a depth of 500 feet below the surface thereof, to mine, excavate,bore, drill and sink and otherwise collect and develop said oils, petroleum,asphaltum, natural gas or other hydrocarbons or other valuable mineralsubstances and products or any other mineral or minerals (whether of the samecharacter hereinabove described generally or not) and also to remove and sellsaid oil, asphaltum natural gas or other hydrocarbons or other valuable mineralsubstances and products or other mineral or minerals, as granted to PorterSesnon, Barbara Sesnon Cartan, William T. Sesnon, Jr. to each an undividedone-third interest as tenants in common, as the separate property, of each, bydeed recorded December 14, 1951 in Book 37855, Page 1, Official Records andrecorded November 3, 1952 in Book 40220, Page 377, Official Records and asquitclaimed by deed dated September 2, 1959 executed by Porter Sesnon, BarbaraSesnon Cartan and William T. Sesnon, Jr., to the then record owner recordedSeptember 14, 1959 in Book D-600, Page 923, Official Records as Instrument No.3561.

Assessor’s Parcel No:2746-014-003

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EXHIBIT B

RECORDING REQUESTED BYANDWHEN RECORDED MAIL THIS GRANTDEED AND ALL TAX STATEMENTS TO:

c/o TA AssociatesRealty1301 Dove Street, Suite 860Newport Beach, California 92660Attn:  Asset Manager – Fund VIII

(Above Space For Recorder’sUse Only)

GRANT DEED

The undersignedgrantor declares:

Documentary Transfer Taxis shown by an unrecorded separate affidavit pursuant to Section 11932 ofthe Revenue and Taxation Code.

FOR VALUABLE CONSIDERATION, receipt of which is herebyacknowledged,                               ,a                        ,hereby GRANTS to                                  ,a                             the following described real property (“Property”) located in the Cityof Los Angeles, County of Los Angeles, State of California.

See Exhibit ”A” attached hereto andincorporated herein by this reference.

SUBJECT TO:

1.             Taxesand assessments not yet due and payable.

2.             All other covenants, conditions, restrictions,reservations, rights, rights of way, easements, encumbrances, liens and titlematters described on Exhibit “B” attached hereto, but not otherwise.

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IN WITNESSWHEREOF, this instrument has been executed as of (but not necessarily on) this     day of             ,2007.
|              | GRANTOR: |
|--------------|----------|
|         |     |
|         |     |
|         |     |
|         | By:      |   |
|         | Name:    |
|         | Title:   |
|         |     |
|         |     |
| THE STATE OF | §   |   |
|         | §   | KNOW ALL MEN BY THESE PRESENTS: |
| COUNTY OF    | §   |   |
|              |          |  |  |  |

 

This instrumentwas acknowledged before me on            , 2007,by                                     .  He/She is personally known to me or hasproduced                  as identification and did/did not take an oath.
|                         |                        |
|-------------------------|-----------------------------|
|                    | Notary Public, State of     |
|                    |                        |
|                    |                        |
| My Commission  Expires: | Notary’s name printed: |
|                    |                        |   |
|                         |                             |  |

 

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| Document No.                                                                                                                                        |   |
|-----------------------------------------------------------------------------------------------------------------------------------------------------|--------|
| Recorded                         2007 |   |

 

STATEMENT OF TAX DUE ANDREQUEST THAT TAX DECLARATION NOT BE MADE A PART OF THE PERMANENT RECORD IN THEOFFICE OF THE COUNTY RECORDER (PURSUANT TO SECTION 11932 OF THE CALIFORNIAREVENUE AND TAXATION CODE)

TO:         Recorder, County of Los Angeles

Request is hereby made inaccordance with the provisions of the Documentary Transfer Tax Act that theamount of the tax due not be shown on the original document which names:

Grantor:

Grantee: 

The property described inthe accompanying document is located in the City of Los Angeles, County of LosAngeles.

The amount of tax due onthe accompanying document is $                              .
| x                                  | Computed on full value of property conveyed.                                        |
|------------------------------------|-------------------------------------------------------------------------------------|
|                               |                                                                                |
| o                                  | Computed on full value, less liens and encumbrances  remaining at the time of sale. |
|                               |                                                                                |
|                               |                                                                                |
| (Signature of  Declarant or Agent) |                                                                                |
|                               |                                                                                |   |
| (Firm Name)                        |                                                                                |
|                                    |                                                                                     |  |  |  |

 

Note:      After the permanent record is made, thisform will be affixed to the conveying document and returned with it.

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EXHIBIT C

BLANKET CONVEYANCE, BILL OF SALE ANDASSIGNMENT
| STATE OF  | § |                            |
|-----------|--------|---------------------------------|
|      | § | KNOW ALL MEN BY THESE PRESENTS: |
| COUNTY OF | § |                            |

 

That concurrentlywith the execution and delivery hereof,                                       ,a                             (“Assignor”), is conveying to                                                                      (“Assignee”), by Grant Deed (the “Deed”), those certain tracts ofland lying and being situated in Los Angeles, California and being moreparticularly described on Exhibit A attached to the Deed and made apart thereof for all purposes (the “Property”).  Unless otherwise defined herein, allinitially capitalized terms shall have the respective meanings ascribed to suchterms in that certain Purchase Agreement dated                          ,2007, by and between Assignor and Realty Associates Advisors, LLC with respectto the conveyance of the Property.

It is the desireof Assignor hereby to assign, transfer and convey to Assignee, subject,however, to those certain matters more particularly described on Exhibit Bto Deed attached thereto and made a part thereof for all purposes(collectively, the “Permitted Encumbrances”), the Currie Lease, allImprovements, Personal Property, and Intangible Property, including, withoutlimitation, those items more particularly described on Exhibit Aattached hereto and made a part hereof for all purposes (collectively, the “AssignedProperties”); provided, however, the Assigned Properties shall not be deemedto include, Assignee shall have no liability under, and Assignor shall remainsolely liable and responsible for, any service or other contracts not listed onExhibit A hereto and the contracts and other matters set forth on Exhibit Battached hereto and made a part hereof for all purposes (collectively, the “Non-Assigned Properties”).

NOW, THEREFORE, inconsideration of the receipt of Ten and No/100 Dollars ($10.00) and other goodand valuable consideration, in hand paid by Assignee to Assignor, the receiptand sufficiency of which are hereby acknowledged and confessed by Assignor,Assignor does hereby ASSIGN, SELL AND CONVEY to Assignee, its successors, legalrepresentatives and assigns, subject to the Permitted Encumbrances, all of theAssigned Properties.

TO HAVE AND TOHOLD the Assigned Properties, together with any and all rights and appurtenancethereto in anywise belonging to Assignor unto Assignee, its successors andassigns FOREVER, and Assignor does hereby bind itself and its successors toWARRANT AND FOREVER DEFEND all and singular the Assigned Properties, subject tothe Permitted Encumbrances, unto Assignee, its successors and assigns, againstevery person whomsoever lawfully claiming or to claim the same or any partthereof by, through or under Grantor, but not otherwise.

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Assignorindemnifies and agrees to protect, defend and hold Assignee and its successorsand assigns harmless from and against any and all liability (including, withoutlimitation, any strict liability), loss, cost, damage or expense (including,without limitation, reasonable attorneys’ fees and costs of suit) incurred by,or otherwise asserted against, Assignee or such successors and assigns to theextent attributable, directly or indirectly, to any one or all of (a) the AssignedProperties, but then only to the extent the act, event, omission, occurrence ormatter giving rise to a claim for indemnity hereunder occurred prior to thedate hereof, and/or (b) the Non-Assigned Properties, regardless of when theact, event, omission, occurrence or matter giving rise to a claim for indemnityhereunder occurred.

Assignee, by itsacceptance hereof, agrees to indemnify, protect, defend and hold Assignorharmless from and against any and all liability (including, without limitation,any strict liability), loss, cost, damage or expense (including, withoutlimitation, reasonable attorneys’ fees and costs of suit) incurred by orotherwise asserted against Assignor with respect to the Assigned Properties tothe extent same arise or are otherwise attributable to the period from andafter the date hereof, but not otherwise; provided, however, Assignee shall bereleased and discharged from and against any liability or obligation hereunderupon the date Assignee no longer holds an interest in the Property as long asAssignee’s successor in interest assumes such obligations in writing.

IN WITNESSWHEREOF, Assignor and Assignee have executed this instrument as of (but notnecessarily on) this                    day of                         ,2007.
|   | ASSIGNOR:        |
|--------|------------------|
|   |             |
|   | [TO BE INSERTED] |
|   |             |
|   | ASSIGNEE:        |
|   |             |
|   | [TO BE INSERTED] |

 

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EXHIBIT D

FIRPTA AFFIDAVIT
| THE STATE OF | § |                            |
|--------------|--------|---------------------------------|
|         | § | KNOW ALL MEN BY THESE PRESENTS: |
| COUNTY OF    | § |                            |

 

Section 1445 ofthe Internal Revenue Code provides that a transferee of a U.S. real propertyinterest must withhold tax if the transferor is a foreign person.  To inform                                                                                        ,(“Transferee”) that withholding of tax is not required upon thedisposition of a U.S. real property interest by                                                    ,a                                                           (“Transferor”), Transferor hereby certifies the following:

1.                                       Transferoris not a foreign corporation, foreign partnership, foreign trust or foreignestate (as those terms are defined in the Internal Revenue Code and Income TaxRegulations);

2.                                       Transferor’sU.S. employer identification number is:                           ;and

3.                                       Transferor’soffice address is                                                                                 .

4.                                       Transferis not a “disregarded entity” (as that term is defined in the Internal RevenueCode and Income Tax Regulations).

Transferorunderstands that this certification may be disclosed to the Internal RevenueService by the Transferee and that any false statement contained herein couldbe punished by fine, imprisonment, or both.

Under penalties ofperjury I declare that I have examined this certification and to the best of myknowledge and belief it is true, correct, and complete, and I further declarethat I have authority to sign this document.

EXECUTEDas of (but not necessarily on) this                 day of                               ,2007.
|        | TRANSFEROR:      |
|--------|------------------|
|   |             |
|   | [TO BE INSERTED] |

 

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SWORN TO AND SUBSCRIBEDBEFORE ME this              day of                         ,2007.

 
|                        |                        |
|------------------------|-----------------------------|
|                   |                        |   |
|                   | Notary Public, State of     |   |
|                   |                        |
|                   |                        |
| My Commission Expires: | Notary’s name printed: |
|                   |                        |
|                   |                        |   |
|                        |                             |  |  |

 

2

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EXHIBIT E

FORM OF NATROL LEASES

[PLEASE SEE Exhibits 10.20 and 10.21 filed herewith]

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EXHIBIT F

DISCLOSURE SCHEDULE

Seller discloses the following items with regards to itsrepresentations, warranties and covenants set forth in Section 9.01 of theattached Purchase Agreement (the “Contract”) by and between Natrol RealEstate, Inc. and Natrol Real Estate II, Inc., collectively, as Seller, andRealty Associates Advisors, LLC, as Purchaser.

·                In November and December 2006, Sellerreceived several Notices of Intent to Expire Permit from the Los AngelesDepartment of Building and Safety (the “*Department*”)for various permits pertaining to the P Building and the O Building.  Seller contacted the Department about allsuch permits (except for Permit No. 97044-10000-01339 relating to a Duct TypeSmoke Det).  Building inspectors for theDepartment indicated they were giving final approval for all such permits,either as a result of inspecting the properties or because of certificates ofoccupancy or permit cards that had been signed as finaled.  To Seller’s knowledge, the work for PermitNo. 97044-10000-01339 was completed according to all applicable building codes.

·                Additional work at the P Building and OBuilding may have occurred for which permits were issued, but never finaled.

·                In 2004, a 14 x 16 foot demising wall for thepackaging department was installed at the P Building without obtaining abuilding permit.

·                In 2005, two 14 x 12 foot office walls wereinstalled at the P Building without obtaining a building permit.

·                There may be various improvements made to orpersonal property installed at the Property that were completed or installed inaccordance with then-applicable building codes. Such improvements and personal property may not be in compliance withcurrent applicable building codes (e.g., in October 2004, NRE receivedinformation from a fire alarm contractor suggesting that NRE’s older smokedetectors and other devices at the P Building were not in compliance withcurrent fire alarm codes.)

·                NRE II has not conducted annual tests of allof the irrigation back flow prevention devices at the O Building.

·                Seller was informed by its property casualtyinsurer that (1) material on the storage racks in the P Building may be stackedtoo high and certain materials or other items of inventory may be grouped toodensely on such storage racks; and (2) Seller should install protective shieldsfor its Halide lighting in both the O Building and the P Building (Seller isthe process of replacing burnt-out Halide lights with those containingprotective shields).

SELLERAGREES THAT ATTACHMENT OF THIS SCHEDULE TO THE CONTRACT DOES NOT INDICATEPURCHASER’S ACCEPTANCE OF THE ABOVE ITEMS NOR MODIFY OR OTHERWISE WAIVE ANY OFPURCHASER’S RIGHTS UNDER THE CONTRACT, INCLUDING PURCHASER’S RIGHT, FOR ANY ORNO REASON, TO TERMINATE THE CONTRACT DURING THE REVIEW PERIOD.

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EXHIBIT G

TITLE REPORT

[PLEASE SEE ATTACHED]

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**“Preliminary Report Top Sheet”**

**Help us stay on top of your transaction!**

**WILL ANY OFTHESE SITUATIONS**

**AFFECT YOUR TRANSACTION?**
| *      | Are your principals exchanging this property?                        | o  Yes | o  No  |
|--------|----------------------------------------------------------------------|--------|--------|
|   |                                                                 |   |   |
| *      | Will your principals be using a power of attorney?                   | o  Yes | o  No  |
|   |                                                                 |   |   |
| *      | Are any of the parties in title deceased?                            | o  Yes | o  No  |
|   |                                                                 |   |   |
| *      | Has there been a change in marital status?                           | o  Yes | o  No  |
|   |                                                                 |   |   |
| *      | Will there be a new entity formed? ie., partnership  or corporation. | o  Yes | o  No  |
|   |                                                                 |   |   |
| *      | Are the sellers of this property non-residents of  California?       | o  Yes | o  No  |

 

**If you answered “YES” to any ofthese questions, please call your Escrow Officer.**
| * | Do all parties signing  document have valid photo I.D. or drivers license? | o  Yes | o  No |
|---|----------------------------------------------------------------------------|--------|-------|

 

If “No”, now is the time to apply for a valid I.D.

This is a “Quick List”, callyour Escrow Officer if you have additional information that you think may beimportant, or if you have any questions.

**Thank youfor choosing Fidelity National Title Company**

----

 
|  | **Fidelity  National Title Company**

OF CALIFORNIA |
|--|-----------------------------------------------------|

 

**PRELIMINARY REPORT**

In response to the application for a policy oftitle insurance referenced herein, Fidelity NationalTitle Company hereby reports that it is prepared to issue,or cause to be issued, as of the date hereof, a Policy or Policies of TitleInsurance describing the land and the estate or interest therein hereinafterset forth, insuring against loss which may be sustained by reason of anydefect, lien or encumbrance not shown or referred to as an Exception herein ornot excluded from coverage pursuant to the printed Schedules, Conditions andStipulations of said Policy forms.

The printed Exceptions and Exclusions from the coverageand Limitations on Covered Risks of said Policy or Policies are set forth inExhibit A attached. Limitations on Covered Risks applicable to the CLTA andALTA Homeowner’s Policies of Title Insurance which establish a DeductibleAmount and a Maximum Dollar Limit of Liability for certain coverages are alsoset forth in Exhibit A. Copies of the Policy forms should be read. They areavailable from the office which issued this report.

This report (and any supplements or amendmentshereto) is issued solely for the purpose of facilitating the issuance of apolicy of title insurance and no liability is assumed hereby. If it is desiredthat liability be assumed prior to the issuance of a policy of title insurance,a Binder or Commitment should be requested.

The Policy(s) of title insurance to be issuedhereunder will be policy(s) of Fidelity National Title Insurance Company, aCalifornia Corporation.

Please read the exceptions shown or referred tobelow and the exceptions and exclusions set forth in Exhibit A of this reportcarefully. The exceptions and exclusions are meant to provide you with noticeof matters which are not covered under the terms of the title insurance policyand should be carefully considered.

It is important to note that this preliminary reportis not a written representation as to the condition of title and may not listall liens, defects and encumbrances affecting title to the land.
|  |  |
|--|--|

 

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| **** | **Fidelity  National Title Company**

6060 Sepulveda Boulevard suite 100 Van Nuys, CA  91411   (818) 881-7800 FAX (818) 776-8528 |   |
|------|----------------------------------------------------------------------------------------------------------------------------------|--------|

 

**PRELIMINARY REPORT**
| ESCROW OFFICER: Helen Fonville                  | ORDER NO.: 19505132 - C          |
|-------------------------------------------------|----------------------------------|
| TITLE OFFICER: Jon Legg - 758-6804 Fax 758-3263 | Amendment                        |
|                                            | LOAN NO.: Natrol Real  Estate II |

 
| TO:    | Fidelity National Title       |
|--------|-------------------------------|
|   | 6060 Sepulveda Boulevard #100 |
|   | Van Nuys, CA 91411            |

 

ATTN:                   Helen Fonville

YOURREFERENCE.: Fidelity National Title

SHORT TERM RATE: No
| PROPERTY ADDRESS: | 9453 Owensmouth Avenue and 21411 Prairie Street, |
|-------------------|--------------------------------------------------|
|              | Chatsworth area Los Angeles, California          |

 

EFFECTIVEDATE: April 2, 2007, 07:30 A.M.

Theform of Policy or Policies of title insurance contemplated by this report is:

California Land Title Association StandardCoverage Policy - 1990

AmericanLand Title Association Loan Policy (10-17-92) with A.L.T.A. Form 1 Coverage

1.             THE ESTATE ORINTEREST IN THE LAND HEREINAFTER DESCRIBED OR REFERRED TO COVERED BY THISREPORT IS:

A FEE as to Parcel(s) 1 and3;

AN EASEMENT more fully described below as to Parcel(s) 2

2.             TITLE TO SAIDESTATE OR INTEREST AT THE DATE HEREOF IS VESTED IN:

Natrol Real Estate II, Inc., a California corporation

3.             THE LAND REFERREDTO IN THIS REPORT IS SITUATED IN THE CITY OF LOS ANGELES, IN THE COUNTY OF LOSANGELES, STATE OF CALIFORNIA, AND IS DESCRIBED AS FOLLOWS:

SEE EXHIBIT “ONE” ATTACHED HERETO AND MADE APART HEREOF

RLK\RLK 04/03/2007

1

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**EXHIBIT “ONE”**

Parcel1:

Allof Lots 7, 8, 9 and 10 of Tract No. 33150, in the City of Los Angeles, Countyof Los Angeles, State of California, as per map filed in Book 910, Pages 63 to65, inclusive of Maps, in the office of the County Recorder of said county.

Exceptfrom that portion of said land lying Westerly of the Westerly lines of Lots 5and 8 of Tract No. 22917, as per map recorded in Book 638, Pages 63 to 66 ofmaps, all oil, asphaltum, petroleum, natural gas and other hydrocarbons andother valuable mineral substances and products and all other minerals whetheror not of the same character herein before described generally in, under orupon said land, but without the right to enter upon the surface of said landand the subsurface lying above a depth of 500 feet below the surface thereof, tomine, excavate, bore, drill and sink and otherwise collect and develop saidoils, petroleum, asphaltum, natural gas or other hydrocarbons or other valuablemineral substances and products or any other mineral or minerals (whether ofthe same character hereinabove described generally or not) and also to removeand sell said oil, asphaltum natural gas or other hydrocarbons or othervaluable mineral substances and products or other mineral or minerals, asgranted to Porter Sesnon, Barbara Sesnon Cartan, William T. Sesnon, Jr. to eachan undivided one-third interest as tenants in common, as the separate property,of each, by deed recorded December 14, 1951 in Book 37855, Page 1, OfficialRecords and recorded November 3, 1952 in Book 40220, Page 377, Official Recordsand as quitclaimed by deed dated September 2, 1959 executed by Porter Sesnon,Barbara Sesnon Cartan and William T. Sesnon, Jr., to the then record ownerrecorded September 14, 1959 in Book D-600, Page 923, Official Records asInstrument No. 3561.

Assessor’sParcel No. 2746-014-018

Parcel2:

Anon-exclusive easement for vehicular staging, ingress and egress as provided inthat certain Easement Agreement recorded May 26, 1999 as Instrument No.99-955816, Official Records, over a portion of Lot 4 of Tract No. 33150 in theCity of Los Angeles, County of Los Angeles, State of California, as per mapfiled in Book 910 Pages 63 through 65 inclusive of Maps, in the office of theCounty Recorder of said county, the easement lying 15.00 feet southerly, measuredat right angles, to the following described line:

Commencingat the southwesterly corner of Lot 7 of said Tract No. 33150, said corner alsobeing the northwesterly corner of said Lot 4; Thence South 89°59 ‘39”East alongthe southerly line of said Lot 7 and the northerly line of said Lot 4, 113.00to the True Point of Beginning; Thence continuing along said last mentionedline South 89°59 ‘39”east 311.32 feet to the Point of Termination, said pointalso being North 89°59 ‘39”West, 148.00 feet from the southeasterly corner ofLot 9 and the northeasterly corner of said Tract No. 33150.

Parcel3:

TheEasterly 130 feet of Lot 2 and all of Lot 3 of Tract No. 33150, in the City ofLos Angeles, County of Los Angeles, State of California, as per map filed inBook 910, Pages 63 to 65, inclusive of Maps, in the office of the CountyRecorder of said county.

Exceptfrom that portion of said land lying Westerly of the Westerly lines of Lots 5and 8 of Tract No. 22917, as per map recorded in Book 638, Pages 63 to 66 ofmaps, all oil, asphaltum, petroleum, natural gas and other hydrocarbons andother valuable mineral

2

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substancesand products and all other minerals whether or not of the same character hereinbefore described generally in, under or upon said land, but without the rightto enter upon the surface of said land and the subsurface lying above a depthof 500 feet below the surface thereof, to mine, excavate, bore, drill and sinkand otherwise collect and develop said oils, petroleum, asphaltum, natural gasor other hydrocarbons or other valuable mineral substances and products or anyother mineral or minerals (whether of the same character hereinabove describedgenerally or not) and also to remove and sell said oil, asphaltum natural gasor other hydrocarbons or other valuable mineral substances and products orother mineral or minerals, as granted to Porter Sesnon, Barbara Sesnon Cartan,William T. Sesnon, Jr. to each an undivided one-third interest as tenants incommon, as the separate property, of each, by deed recorded December 14, 1951in Book 37855, Page 1, Official Records and recorded November 3, 1952 in Book40220, Page 377, Official Records and as quitclaimed by deed dated September 2,1959 executed by Porter Sesnon, Barbara Sesnon Cartan and William T. Sesnon,Jr., to the then record owner recorded September 14, 1959 in Book D-600, Page923, Official Records as Instrument No. 3561.

Assessor’sParcel No. 2746-014-003

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ATTHE DATE HEREOF, ITEMS TO BE CONSIDERED AND EXCEPTIONS TO COVERAGE IN ADDITIONTO THE PRINTED EXCEPTIONS AND EXCLUSIONS IN SAID POLICY FORM WOULD BE ASFOLLOWS:

1.                                                                      Property taxes, which are a lien not yet dueand payable, including any assessments collected with taxes to be levied forthe fiscal year 2007-2008.

2.                                                                      Property taxes, including any personalproperty taxes and any assessments collected with taxes, for the fiscal year2006-2007, Assessor’s Parcel Number 2746-014-018.
| Code Area Number:  | 0000016             |
|--------------------|---------------------|
| 1st Installment:   | $54,129.37 Paid     |
| 2nd Installment:   | $54,129.36 Not Paid |
| Land:              | $4,161,366.00       |
| Improvements:      | $3,905,497.00       |
| Exemption:         | $00                 |
| Personal Property: | $00                 |
| Affects:           | Parcel 1            |

 

3.                                                                      Property taxes, including any personalproperty taxes and any assessments collected with taxes, for the fiscal year2006-2007, Assessor’s Parcel Number 2746-014-003.
| Code Area Number:   | 00016               |
|---------------------|---------------------|
| 1st Installment:    | $43,269.84 Paid     |
| 2nd Installment:    | $43,269.83 Not Paid |
| Land:               | $3,154,765.00       |
| Improvements:       | $3,553,141.00       |
| Exemption:          | $                   |
| Personal  Property: | $                   |
| Affects:            | Parcel 3            |

 

4.                                                                      The lien of supplemental taxes, if any,assessed pursuant to the provisions of Chapter 3.5 (Commencing with Section 75)of the Revenue and Taxation code of the State of California.

5.                                                                      Water rights, claims or title to water,whether or not disclosed by the public records.

6.                                                                      A covenant and agreement entitled “Covenantand Agreement regarding Submission of Landscape Plan”
| Executed by: | Almo Properties                                                 |
|--------------|-----------------------------------------------------------------|
| In favor of: | City of Los Angeles                                             |
| Recorded:    | January 10, 1979, Instrument No. 79-40946, of  Official Records |

 

Which among other things provides: Landscape plansubmission 

Reference is hereby made to said document for fullparticulars.

This covenant and agreement shall run with the land and shall be bindingupon any future owners, encumbrancers, their successors or assigns, and shallcontinue in effect until the advisory agency approves termination.

4

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7.                                                                      A covenant and agreement entitled “Covenantand Agreement for Traffic Control Plan”
| Executed by: | Almo Properties                                                 |
|--------------|-----------------------------------------------------------------|
| In favor of: | Advisory Agency of the City of Los Angeles                      |
| Recorded:    | January 11, 1979, Instrument No. 79-47472, of  Official Records |

 

Which among other things provides: submission oftraffic control plan 

Reference is hereby made to said document for fullparticulars.

This covenant and agreement shall run with the land and shall be bindingupon any future owners, encumbrancers, their successors or assigns, and shallcontinue in effect until the advisory agency****approvestermination.

8.                                                                      A covenant and agreement entitled “Covenantand Agreement Regarding Parking Area and Driveway Plan”
| Executed by: | Almo Properties etal                                         |
|--------------|--------------------------------------------------------------|
| In favor of: | City of Los Angeles                                          |
| Recorded:    | May 11, 1979, Instrument No. 79-514399, of Official  Records |

 

Which among other things provides: Parking andDriveway Plan 

Reference is hereby made to said document for fullparticulars.

This covenant and agreement shall run with the land and shall be bindingupon any future owners, encumbrancers, their successors or assigns, and shallcontinue in effect until the advisory agency approves termination.

9.                                                                      A covenant and agreement entitled “Covenantand Agreement Regarding Maintenance of Yards for an Oversized Building”
| Executed by: | David Alpert                                                        |
|--------------|---------------------------------------------------------------------|
| In favor of: | City of Los Angeles                                                 |
|         |                                                                |
| Recorded:    | September 17, 1979, Instrument No. 79-1033747, of  Official Records |

 

Which among other things provides: maintenance of yards

Reference is hereby made to said document for full particulars.

This covenant and agreement shall run with the land and shall be bindingupon any future owners, encumbrancers, their successors or assigns, and shallcontinue in effect until the advisory agency approves termination.

Said matter is shown on the ALTA/ACSM Survey prepared by R,B. Engineeringon April 20, 1996, updated February 24, 2007, last updated March    ,2007.
| Affects: | Parcels 1 and 2 |
|----------|-----------------|

 

10.                                                                Covenant and agreement wherein the ownersagree to hold said land as one parcel and not to sell any portion thereofseparately. Said covenant is expressed to run with the land and be binding uponfuture owners.
| Recorded: | September 17, 1979,  Instrument No. 79-1033748, of Official Records |
|-----------|---------------------------------------------------------------------|

 

Reference is made to said document for full particulars.

5

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This covenant and agreement shall run with the land and shall be bindingupon any future owners, encumbrancers, their successors or assigns, and shallcontinue in effect until the advisory agency approves termination.

Affects:                             Parcel 1

11.                                                                A 5 foot easement contained in that certaindocument entitled “Easement Agreement” dated May 26 1999, executed by andbetween WHLW Real Estate Limited Partnership, a Delaware limited partnershipand Meissner Owensmouth LLC, a Delaware limited liability company recorded May26, 1999, Instrument No. 99-955816, of Official Records, which document, amongother things, contains or provides for: covenants and conditions

Reference is hereby made to said document for full particulars.

Said Easement Agreement has been amended by a document recorded January 72000 as instrument no. 00-26822 of Official Records of said County.

Said matter is shown on the ALTA/ACSM Survey prepared by R,B. Engineeringon April 20, 1996, updated February 24, 2007, last updated March    ,2007.

Affects:                             Parcels 1 and 2

12.                                                                The fact that the ownership of said land doesnot include rights of access to or from the street, Canoga Avenue abutting saidland, such rights having been relinquished by the map of said 33150 as per maprecorded in Book 910 Pages 63 to 65 of Maps.

Said matter is shown on the ALTA Survey prepared byMark P. Pfeiler (LS 5959) of R.B. Engineering on April 20, 1996, last updatedMarch 5, 2007, signed on April 2, 2007.

Affects:                             Parcel 3

13.                                                                Covenant and Agreement wherein the ownersagree to hold said land as one parcel and not to sell any portion thereofseparately. Said covenant is expressed to run with the land and be binding uponfuture owners.

Recorded:                          July 25, 1979, Instrument No. 79-818372, ofOfficial Records

This covenant and agreement shall run with the land and shall be bindingupon any future owners, encumbrancers, their successors or assigns, and shallcontinue in effect until the advisory agency approves termination.

Affects:                             Parcel 3

14.                                                                Covenant and agreement wherein the ownersagree to hold said land as one parcel and not to sell any portion thereofseparately. Said covenant is expressed to run with the land and be binding uponfuture owners.

Recorded:                          October 18, 1979, Instrument No. 79-1171494,of Official Records

Reference is made to said document for full particulars.

This covenant and agreement shall run with the land and shall be bindingupon any future owners, encumbrancers, their successors or assigns, and shallcontinue in effect until the advisory agency approves termination.

6

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| Affects: | Parcel 3 |
|----------|----------|

 

15.                                                                A Covenant and Agreement RegardingMaintenance of Yards for an Oversized Building.
| Executed by: | Almo Properties                                                   |
|--------------|-------------------------------------------------------------------|
| In favor of: | City of Los Angeles                                               |
| Recorded:    | February 10, 1982, Instrument No. 82-155090, of  Official Records |

 

Which among other things provides: maintenance of yards.

This covenant and agreement shall run with the land and shall be bindingupon any future owners, encumbrancers, their successors or assigns, and shallcontinue in effect until the advisory agency approves termination.

Said matter is shown on the ALTA Survey prepared byMark P. Pfeiler (LS 5959) of R.B. Engineering on April 20, 1996, last updatedMarch 5, 2007, signed on April 2, 2007.
| Affects: | Parcel 3 |
|----------|----------|

 

16.                                                                Easement(s) for the purpose(s) shown belowand rights incidental thereto as granted in a document;
| Granted to: | Pacific Bell                                                      |
|-------------|-------------------------------------------------------------------|
| Purpose:    | 20 foot wide underground communications easement                  |
| Recorded:   | October 26, 1989, Instrument No. 89-1723964, of  Official Records |
| Affects:    | a portion of said land as therein provided                        |

 

Said matter is shown on the ALTA Survey prepared byMark P. Pfeiler (LS 5959) of R.B. Engineering on April 20, 1996, last updatedMarch 5, 2007, signed on April 2, 2007.
| Affects: | Parcel 3 |
|----------|----------|

 

17.                                                                A deed of trust to secure an indebtedness inthe amount shown below, and any other obligations secured thereby
| Amount:      | $3,500,000.00                                                |
|--------------|--------------------------------------------------------------|
| Dated:       | April 14, 1999                                               |
| Trustor:     | Natrol Real Estate, Inc., a California corporation           |
| Trustee:     | American Securities Company, a California  corporation       |
| Beneficiary: | Wells Fargo Bank, National Association                       |
| Loan No.:    |                                                         |
| Recorded:    | May 13, 1999, Instrument No. 99-869674, of Official  Records |

 

An assignment of the beneficial interest under said deed of trust whichnames:
| Assignee: | LaSalle Bank National Association, as trustee for  Bear Stearns Commercial Mortgage Securities Inc., Commercial Pass Through  Certificates, Series 2000-WF1 |
|-----------|-------------------------------------------------------------------------------------------------------------------------------------------------------------|
| Loan No.: |                                                                                                                                                        |
| Recorded: | May 19, 2000, Instrument No. 00-781146, of Official  Records                                                                                                |
|      |                                                                                                                                                        |
| Affects:  | Parcel 3                                                                                                                                                    |

 

7

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NOTE: Amended Civil Code Section 2941, which becomes effective on January1, 2002 sets the fee for the processing and recordation of the reconveyance ofeach Deed of Trust being paid through this transaction $45.00. The reconveyancemust be clearly set forth in the Beneficiary’s Payoff Demand Statement (“Demand”).In addition, an assignment or authorized release of the fee, from theBeneficiary to the Trustee of the record, must be included. an example of therequired language is as follows:

“The beneficiary identified above hereby assignsreleases or transfer to the Trustee of record, the sub of $45.00, includedherein as “Reconveyance Fee”, for the processing and recordation of theReconveyance of the Deed of Trust securing the indebtedness covered hereby, andthe escrow company or title processing this pay-off is authorized to deduct theReconveyance Fee from this Demand and forward said fee to the trustee of recordor the successor Trustee under the Trust Deed to be paid off in Full.”

In the event that the reconveyance fee and the assignment, release ortransfer are not included within the Demand Statement, then Fidelity NationalTitle Insurance Company and its Underwritten Agent may decline to process thereconveyance and will be forced to return all documentation directly to theBeneficiary for compliance with the requirements of the revised statute.

18.                                                                A Covenant and Agreement RegardingMaintenance of Yards for an Oversized Building.
| Executed by: | Almo Properties                                                    |
|--------------|--------------------------------------------------------------------|
| In favor of: | City of Los Angeles                                                |
| Recorded:    | December 17, 1996, Instrument No. 96-2036452, of  Official Records |

 

Which among other things provides: maintenance of yards.

An assignment of the beneficial interest under said deed of trust whichnames:
| Assignee: | LaSalle Bank National Association, as trustee for  the Registered Holders of Bear Stearns Commercial Mortgage Securities Inc.,  Commercial Mortgage Pass Through Certificates, Series 2000-WF2 |
|-----------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| Loan No.: |                                                                                                                                                                                           |
| Recorded: | November 16, 2000, Instrument No. 00-1794294, of  Official Records                                                                                                                             |
|      |                                                                                                                                                                                           |
| Affects:  | Parcels 1 and 2                                                                                                                                                                                |

 

19.                                                                Matters contained in that certain documententitled “Landlord’s Waiver and Agreement” dated March 30, 2005, executed byand between Natrol Real Estate II, Inc., a California corporation and GilmoreEnterprises Window Coverings, Inc., a California corporation recorded August12, 2005, Instrument No. 05-1935159, of Official Records, which document, amongother things, contains or provides for: As Set Out Therein.

Reference is hereby made to said document for full particulars.
| Affects: | Parcels 1 and 2 |
|----------|-----------------|

 

20.                                                                Matters contained in that certain documententitled “Mortgage Agreement” dated August 25, 2006, executed by and betweenWachovia Capital Finance Corporation (Western), a California corporation andLaSalle Bank National Association, as Trustee of the Bear Stearns CommercialMortgage Securities Inc., Commercial Mortgage Pass-Through Certificates, Series2000-WF2 recorded October 25, 2006, Instrument No. 06-2372476, of OfficialRecords, which document, among other things, contains or provides for: As SetOut Therein.

Reference is hereby made to said document for full particulars.

8

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| Affects: | Parcels 1 and 2 |
|----------|-----------------|

 

21.                                                                An unrecorded lease with certain terms,covenants, conditions and provisions set forth therein as disclosed by thedocument
| Entitled: | Subordination Agreement                                      |
|-----------|--------------------------------------------------------------|
| Lessor:   | Natrol Real Estate Inc.                                      |
| Lessee:   | Natrol, Inc.                                                 |
| Recorded: | May 13, 1999, Instrument No. 99-869675, of Official  Records |

 

The present ownership of the leasehold created by said lease and othermatters affecting the interest of the lessee are not shown herein.

NOTE: Amended Civil Code Section 2941, which becomes effective on January1, 2002 sets the fee for the processing and recordation of the reconveyance ofeach Deed of Trust being paid through this transaction $45.00. The reconveyancemust be clearly set forth in the Beneficiary’s Payoff Demand Statement (“Demand”).In addition, an assignment or authorized release of the fee, from theBeneficiary to the Trustee of the record, must be included. an example of therequired language is as follows:

“The beneficiary identified above hereby assignsreleases or transfer to the Trustee of record, the sub of $45.00, includedherein as “Reconveyance Fee”, for the processing and recordation of theReconveyance of the Deed of Trust securing the indebtedness covered hereby, andthe escrow company or title processing this pay-off is authorized to deduct theReconveyance Fee from this Demand and forward said fee to the trustee of recordor the successor Trustee under the Trust Deed to be paid off in Full.”

In the event that the reconveyance fee and the assignment, release ortransfer are not included within the Demand Statement, then Fidelity NationalTitle Insurance Company and its Underwritten Agent may decline to process thereconveyance and will be forced to return all documentation directly to theBeneficiary for compliance with the requirements of the revised statute.

22.                                                                A deed of trust to secure an indebtedness inthe amount shown below, and any other obligations secured thereby
| Amount:      | $5,400,000.00                                                      |
|--------------|--------------------------------------------------------------------|
| Dated:       | December 13, 1999                                                  |
| Trustor:     | Natrol Real Estate II, Inc., a California  corporation             |
| Trustee:     | American Securities Company, a California  corporation             |
| Beneficiary: | Wells Fargo Bank, National Association                             |
| Loan No.:    |                                                               |
| Recorded:    | December 16, 1999, Instrument No. 99-2318475, of  Official Records |

 

23.                                                                Any rights of the parties in possession of aportion of, or all of, said land, which rights are not disclosed by the publicrecord.

This Company will require, for review, a full and complete copy of anyunrecorded agreement, contract, license and/or lease, together with allsupplements, assignments and amendments thereto, before issuing any policy oftitle insurance without excepting this item from coverage. The Company reservesthe right to except additional items and/or make additional requirements afterreviewing said documents.

9

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24.                                                                In order to complete this report, thisCompany requires a Statement of Information to be completed by the followingparty,
| Party: | All Parties |
|--------|-------------|

 

The Company reserves the right to add additional items or make furtherrequirements after review of the requested Statement(s) of Information.

25.                                                                The application for title insurance wasplaced by reference to only a street address or tax identification number.

Based on our records, we believe that the description in this reportcovers the parcel requested, however, if the legal description is incorrect anew report must be prepared.

If the legal description is incorrect, in order to prevents delays, theseller, buyer and/or borrower must provided the company and/or the settlementagent with the correct legal description intended to be the subject of thistransaction.

26.                                                                The transaction contemplated in connectionwith this Report is subject to the review and approval of the Company’sCorporate Underwriting Department. The Company reserves the right to addadditional items or make further requirements after such review.

27.                                                                This Company will require the followingdocuments for review prior to the issuance of any title assurance predicatedupon a conveyance or encumbrance by the corporation named below.
| Corporation: | Natrol Real Estate II, Inc., a California corporation,                                                                                   |
|--------------|------------------------------------------------------------------------------------------------------------------------------------------|
|         |                                                                                                                                     |
| (a)          | A copy of the corporation By-Laws and Articles of  Incorporation.                                                                        |
|         |                                                                                                                                     |
| (b)          | An original or certified copy of the Resolution  authorizing the transaction contemplated herein.                                        |
|         |                                                                                                                                     |
| (c)          | If the Articles and/or By-Laws require approval by a  “parent” organization, a copy of the Articles and By-Laws of the parent. |

 

The right is reserved to add requirements or additional items aftercompletion of such review.

**END OFITEMS**

Note 1.              The current owner does NOT qualify for the$20.00 discount pursuant to the coordinated stipulated judgments entered inactions filed by both the Attorney General and private class action plaintiffsfor the herein described property.

Note 2.              NOTE: The policy of title insurance willinclude an arbitration provision. The Company or the insured may demandarbitration. Arbitrable matters may include, but are not limited to, anycontroversy or claim between the Company and the insured arising out of orrelating to this policy, any service of the Company in connection with itsissuance or the breach of a policy provision or other obligation. Please askyour escrow or title officer for a sample copy of the policy to be issued ifyou wish to review the arbitration provisions and any other provisionspertaining to your Title Insurance coverage.

10

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Note 3.              Noneof the items shown in this report will cause the Company to decline to attachCLTA Endorsement Form 100 to an Extended Coverage Loan Policy, when issued.

Note 4.              The Company is not aware of any matters whichwould cause it to decline to attach the CLTA Endorsement Form 116 indicatingthat there is located on said land Commercial known as 9453 Owensmouth Avenue(Chatsworth Area), Los Angeles, CA to an Extended Coverage Loan Policy.

Note 5.              California Revenue and Taxation Code Section18662, effective January 1, 1994 and by amendment effective January 1, 2003,provides that the buyer in all sales of California Real Estate may be requiredto withhold 3 and 1/3% of the total sales price as California State Income Tax,subject to the various provisions of the law as therein contained.

Note 6.              There are NO deeds affecting said land,recorded within twenty-four (24) months of the date of this report.

Note 7.              WIRE INSTRUCTIONS

COMERICA BANK CALIFORNIA 

Financial Services Group 

2321 Rosecrans Avenue, Suite1225 

El Segundo, CA, 90245

Routing No. 121137522

For Credit to FIDELITY NATIONAL TITLE

Account No. 1891608570 

Attn: Payoff Department 

Ref: Order No. 19505132 

Title Officer: Jon Legg
|  | **Fidelity  National Title Company**

OF CALIFORNIA |
|--|-----------------------------------------------------|

 

11

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Notice

You may be entitled toreceive a $20.00 discount on escrow services if you purchased, sold orrefinanced residential property in California between May 19, 1995 and November1, 2002. If you had more than one qualifying transaction, you may be entitledto multiple discounts.

If your previous transactioninvolved the same property that is the subject of your current transaction, youdo not have to do anything; the Company will provide the discount, provided youare paying for escrow or title services in this transaction.

If your previous transactioninvolved property different from the property that is the subject of yourcurrent transaction, you must - prior to the close of the current transaction -inform the Company of the earlier transaction, provide the address of theproperty involved in the previous transaction, and the date or approximate datethat the escrow closed to be eligible for the discount.

Unless you inform theCompany of the prior transaction on property that is not the subject of this transaction,the Company has no obligation to conduct an investigation to determine if youqualify for a discount. If you provide the Company information concerning aprior transaction, the Company is required to determine if you qualify for adiscount which is subject to other terms and conditions.

Effective through November1, 2014

----

Fidelity National Financial Group of Companies’Privacy Statement

July 1, 2001

Werecognize and respect the privacy expectations of today’s consumers and therequirements of applicable federal and state privacy laws. We believe thatmaking you aware of how we use your non-public personal information (°PersonalInformation±),and to whom it is disclosed, will form the basis for arelationship of trust between us and the public that we serve. This PrivacyStatement provides that explanation. We reserve the right to change thisPrivacy Statement from time to time consistent with applicable privacy laws.

Inthe course of our business, we may collect Personal Information about you fromthe following sources:

Fromapplications or other forms we receive from you or your authorizedrepresentative;

Fromyour transactions with, or from the services being performed by, us, ouraffiliates, or others;  

Fromour internet web sites;

Fromthe public records maintained by governmental entities that we either obtaindirectly from those entities, or from our affiliates or others; and

From consumer or other reporting agencies.

OurPolicies Regarding the Protection of the Confidentiality and Security of YourPersonal Information

Wemaintain physical, electronic and procedural safeguards to protect yourPersonal Information from unauthorized access or intrusion. We limit access tothe Personal Information only to those employees who need such access in connectionwith providing products or services to you or for other legitimate businesspurposes.

OurPolicies and Practices Regarding the Sharing of Your Personal Information

We may share your Personal Information withour affiliates, such as insurance companies, agents, and other real estatesettlement service providers. We also may disclose your Personal Information:  

toagents, brokers or representatives to provide you with services you haverequested;  

tothird-party contractors or service providers who provide services or performmarketing or other functions on our behalf; and

to others with whom we enter into jointmarketing agreements for products or services that we believe you may find ofinterest.

Inaddition, we will disclose your Personal Information when you direct or give uspermission, when we are required by law to do so, or when we suspect fraudulentor criminal activities. We also may disclose your Personal Information whenotherwise permitted by applicable privacy laws such as, for example, whendisclosure is needed to enforce our rights arising out of any agreement,transaction or relationship with you.

Oneof the important responsibilities of some of our affiliated companies is torecord documents in the public domain. Such documents may contain your PersonalInformation.

Rightto Access Your Personal Information and Ability to Correct Errors or RequestChanges or Deletion

Certainstates afford you the right to access your Personal Information and, undercertain circumstances, to find out to whom your Personal Information has beendisclosed. Also, certain states afford you the right to request correction,amendment or deletion of your Personal Information. We reserve the right, wherepermitted by law, to charge a reasonable fee to cover the costs incurred inresponding to such requests.

Allrequests must be made in writing to the following address:
|   | Privacy Compliance Officer         |   |
|--------|------------------------------------|--------|
|   | Fidelity  National Financial, Inc. |   |
|   | 601 Riverside  Avenue              |   |
|   | Jacksonville, FL  32204            |   |

 

MultipleProducts or Services

Ifwe provide you with more than one financial product or service, you may receivemore than one privacy notice from us. We apologize for any inconvenience thismay cause you.

----

**“Preliminary Report Top Sheet”**

**Help us stay on top of your transaction!**

**WILL ANY OFTHESE SITUATIONS**

**AFFECT YOUR TRANSACTION?**
| *      | Are your principals exchanging this property?                        | o  Yes | o  No  |
|--------|----------------------------------------------------------------------|--------|--------|
|   |                                                                 |   |   |
| *      | Will your principals be using a power of attorney?                   | o  Yes | o  No  |
|   |                                                                 |   |   |
| *      | Are any of the parties in title deceased?                            | o  Yes | o  No  |
|   |                                                                 |   |   |
| *      | Has there been a change in marital status?                           | o  Yes | o  No  |
|   |                                                                 |   |   |
| *      | Will there be a new entity formed? ie., partnership  or corporation. | o  Yes | o  No  |
|   |                                                                 |   |   |
| *      | Are the sellers of this property non-residents of  California?       | o  Yes | o  No  |

 

**If you answered “YES” to any ofthese questions, please call your Escrow Officer.**
| * | Do all parties signing  document have valid photo I.D. or drivers license? | o  Yes | o  No |
|---|----------------------------------------------------------------------------|--------|-------|

 

If “No”, now is the time to apply for a valid I.D.

This is a “Quick List”, callyour Escrow Officer if you have additional information that you think may beimportant, or if you have any questions.

**Thank youfor choosing Fidelity National Title Company**

----

 
|  | **Fidelity  National Title Company**

OF CALIFORNIA |
|--|-----------------------------------------------------|

 

**PRELIMINARY REPORT**

In response to the application for a policy oftitle insurance referenced herein, Fidelity NationalTitle Company hereby reports that it is prepared to issue,or cause to be issued, as of the date hereof, a Policy or Policies of TitleInsurance describing the land and the estate or interest therein hereinafterset forth, insuring against loss which may be sustained by reason of anydefect, lien or encumbrance not shown or referred to as an Exception herein ornot excluded from coverage pursuant to the printed Schedules, Conditions andStipulations of said Policy forms.

The printed Exceptions and Exclusions from the coverageand Limitations on Covered Risks of said Policy or Policies are set forth inExhibit A attached. Limitations on Covered Risks applicable to the CLTA andALTA Homeowner’s Policies of Title Insurance which establish a DeductibleAmount and a Maximum Dollar Limit of Liability for certain coverages are alsoset forth in Exhibit A. Copies of the Policy forms should be read. They areavailable from the office which issued this report.

This report (and any supplements or amendmentshereto) is issued solely for the purpose of facilitating the issuance of apolicy of title insurance and no liability is assumed hereby. If it is desiredthat liability be assumed prior to the issuance of a policy of title insurance,a Binder or Commitment should be requested.

The Policy(s) of title insurance to be issuedhereunder will be policy(s) of Fidelity National Title Insurance Company, aCalifornia Corporation.

Please read the exceptions shown or referred tobelow and the exceptions and exclusions set forth in Exhibit A of this reportcarefully. The exceptions and exclusions are meant to provide you with noticeof matters which are not covered under the terms of the title insurance policyand should be carefully considered.

It is important to note that this preliminary reportis not a written representation as to the condition of title and may not listall liens, defects and encumbrances affecting title to the land.
|  |  |
|--|--|

 

----

| **** | **Fidelity  National Title Company**

6060 Sepulveda Boulevard suite 100 Van Nuys, CA  91411   (818) 881-7800 FAX (818) 776-8528 |   |
|------|----------------------------------------------------------------------------------------------------------------------------------|--------|

 

**PRELIMINARY REPORT**
| ESCROW OFFICER: Helen Fonville  TITLE OFFICER: Jon Legg - 758-6804 Fax 758-3263 |   | ORDER NO.: 19505132 

 

LOAN NO.: Natrol Real  Estate |
|---------------------------------------------------------------------------------|--------|-------------------------------------------------------------|

 
| TO:    | CB Richard Ellis                   |
|--------|------------------------------------|
|   | 10 Universal City Plaza 27th Floor |
|   | Universal City, CA 91608           |

 

ATTN:                   Bennett Robinson 

YOUR REFERENCE.: 21411Prairie

SHORT TERM RATE: No

PROPERTY ADDRESS:                      21411 PrairieStreet (Chatsworth Area), Los Angeles, California

EFFECTIVEDATE: March 23, 2007, 07:30 A.M.

Theform of Policy or Policies of title insurance contemplated by this report is:

California Land Title Association Standard CoveragePolicy - 1990

AmericanLand Title Association Loan Policy (10-17-92) with A.L.T.A. Form 1 Coverage

1.             THE ESTATE ORINTEREST IN THE LAND HEREINAFTER DESCRIBED OR REFERRED TO COVERED BY THISREPORT IS:

A Fee

2.             TITLE TO SAIDESTATE OR INTEREST AT THE DATE HEREOF IS VESTED IN:

Natrol Real Estate, Inc., a California corporation

3.             THE LAND REFERREDTO IN THIS REPORT IS SITUATED IN THE CITY OF LOS ANGELES, IN THE COUNTY OF LOSANGELES, STATE OF CALIFORNIA, AND IS DESCRIBED AS FOLLOWS:

SEE EXHIBIT “ONE” ATTACHED HERETO AND MADE APART HEREOF

RLK\RLK 03/25/2007

1

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**EXHIBIT “ONE”**

TheEasterly 130 feet of Lot 2 and all of Lot 3 of Tract No. 33150, in the City ofLos Angeles, County of Los Angeles, State of California, as per map filed inBook 910, Pages 63 to 65, inclusive of Maps, in the office of the CountyRecorder of said county.

Exceptfrom that portion of said land lying Westerly of the Westerly lines of Lots 5and 8 of Tract No. 22917, as per map recorded in Book 638, Pages 3 to 66 ofmaps, all oil, asphaltum, petroleum, natural gas and other hydrocarbons andother valuable mineral substances and products and all other minerals whetheror not of the same character herein before described generally in, under orupon said land, but without the right to enter upon the surface of said landand the subsurface lying above a depth of 500 feet below the surface thereof,to mine, excavate, bore, drill and sink and otherwise collect and develop saidoils, petroleum, asphaltum, natural gas or other hydrocarbons or other valuablemineral substances and products or any other mineral or minerals (whether ofthe same character hereinabove described generally or not) and also to removeand sell said oil, asphaltum natural gas or other hydrocarbons or othervaluable mineral substances and products or other mineral or minerals, asgranted to Porter Sesnon, Barbara Sesnon Cartan, William T. Sesnon, Jr. to eachan undivided one-third interest as tenants in common, as the separate property,of each, by deed recorded December 14, 1951 in Book 37855, Page 1, OfficialRecords and recorded November 3, 1952 in Book 40220, Page 377, Official Recordsand as quitclaimed by deed dated September 2, 1959 executed by Porter Sesnon,Barbara Sesnon Cartan and William T. Sesnon, Jr., to the then record ownerrecorded September 14, 1959 in Book D-600, Page 923, Official Records asInstrument No. 3561.

Assessor’sParcel No: 2746-014-003

2

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ATTHE DATE HEREOF, ITEMS TO BE CONSIDERED AND EXCEPTIONS TO COVERAGE IN ADDITIONTO THE PRINTED EXCEPTIONS AND EXCLUSIONS IN SAID POLICY FORM WOULD BE ASFOLLOWS:

1.                                                                      Property taxes, which are a lien not yet dueand payable, including any assessments collected with taxes to be levied forthe fiscal year 2007-2008.

2.                                                                      Property taxes, including any personalproperty taxes and any assessments collected with taxes, for the fiscal year2006-2007, Assessor’s Parcel Number 2746-014-003.
| Code Area Number:  | 0000016             |
|--------------------|---------------------|
| 1st Installment:   | $43,269.84 Paid     |
| 2nd Installment:   | $43,269.83 Not Paid |
| Land:              | $3,154,765.00       |
| Improvements:      | $3,553,141.00       |
| Exemption:         | $00                 |
| Personal Property: | $00                 |
| Bill No.:          | 2                   |

 

3.                                                                      The lien of supplemental taxes, if any,assessed pursuant to the provisions of Chapter 3.5 (Commencing with Section 75)of the Revenue and Taxation code of the State of California. As of the datehereof, no such supplemental taxes are due or payable.

4.                                                                      Water rights, claims or title to water,whether or not disclosed by the public records.

5.                                                                      The fact that the ownership of said land doesnot include rights of access to or from the street, Canoga Avenue abutting saidland, such rights having been relinquished by the map of said Tract 33150 asper map recorded in Book 910 Pages 63 to 65 of Maps.

Said matter is shown on the ALTA Survey prepared by R.B. Engineering onApril 20, 1996, last updated March 5, 2007.

6.                                                                      A covenant and agreement entitled “Covenantand Agreement Regarding Submission of Landscape Plan”
| Executed by: | Almo Properties                                                 |
|--------------|-----------------------------------------------------------------|
| In favor of: | City of Los Angeles                                             |
| Recorded:    | January 10, 1979, Instrument No. 79-40946, of  Official Records |

 

Which among other things provides: Submission ofLandscape Plan

Reference is hereby made to said document for fullparticulars.

This covenant and agreement shall run with the land and shall be bindingupon any future owners, encumbrancers, their successors or assigns, and shallcontinue in effect until the advisory agency approves termination.

3

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7.                                                                      A covenant and agreement entitled “Covenantand Agreement for Traffic Control Plan”
| Executed by: | Almo Properties etal                                            |
|--------------|-----------------------------------------------------------------|
| In favor of: | City of Los Angeles                                             |
| Recorded:    | January 11, 1979, Instrument No. 79-47472, of  Official Records |

 

Which among other things provides: Matters pertainingto a Traffic Control Plan

Reference is hereby made to said document for fullparticulars.

This covenant and agreement shall run with the land and shall be bindingupon any future owners, encumbrancers, their successors or assigns, and shallcontinue in effect until the advisory agency approves termination.

8.                                                                      A covenant and agreement entitled “Covenantand Agreement Regarding Parking Area and Driveway Plan”
| Executed by: | Almo Properties etal                                         |
|--------------|--------------------------------------------------------------|
| In favor of: | City of Los Angeles                                          |
| Recorded:    | May 11, 1978, Instrument No. 79-514399, of Official  Records |

 

Which among other things provides: Requirement for submission of parkingplan and driveway plan.

Reference is hereby made to said document for full particulars.

This covenant and agreement shall run with the land and shall be bindingupon any future owners, encumbrancers, their successors or assigns, and shallcontinue in effect until the advisory agency approves termination.

9.                                                                      A covenant and agreement entitled “Covenantand Agreement to Hold Property as One Parcel”
| Executed by: | Almo Properties                                               |
|--------------|---------------------------------------------------------------|
| In favor of: | City of Los Angeles                                           |
| Recorded:    | July 25, 1979, Instrument No. 79-818372, of Official  Records |

 

Which among other things provides: To hold said landas one parcel of land.

Reference is hereby made to said document for fullparticulars.

This covenant and agreement shall run with the land and shall be bindingupon any future owners, encumbrancers, their successors or assigns, and shallcontinue in effect until the advisory agency approves termination.

10.                                                                A covenant and agreement entitled “Covenantand Agreement to Hold Property as One Parcel”
| Executed by: | David Alpert                                                      |
|--------------|-------------------------------------------------------------------|
| In favor of: | City of Los Angeles                                               |
| Recorded:    | October 18, 1979, Instrument No. 79-1171494, of  Official Records |

 

Which among other things provides: Holding said land as in Parcel tocomply with Parcel Map Exemption 2164.

Reference is hereby made to said document for full particulars.

This covenant and agreement shall run with the land and shall be bindingupon any future owners, encumbrancers, their successors or assigns, and shallcontinue in effect until the advisory agency approves termination.

4

----

11.                                                                A covenant and agreement entitled “Covenantand Agreement Regarding Maintenance of Yards for an Oversized Building” 
| Executed by: | Almo Properties                                                   |
|--------------|-------------------------------------------------------------------|
| In favor of: | City of Los Angeles                                               |
| Recorded:    | February 10, 1982, Instrument No. 82-155090, of  Official Records |

 

Which among other things provides: Maintenance of yards.

Reference is hereby made to said document for full particulars.

This covenant and agreement shall run with the land and shall be bindingupon any future owners, encumbrancers, their successors or assigns, and shallcontinue in effect until the advisory agency approves termination.

Said matter is shown on the ALTA Survey prepared by R.B. Engineering onApril 20, 1996, last updated March 5, 2007.

12.                                                                Easement(s) for the purpose(s) shown belowand rights incidental thereto as set forth in a document;
| In favor of: | Pacific Bell                                                      |
|--------------|-------------------------------------------------------------------|
| Purpose:     | 20 foot wide underground communications easement                  |
| Recorded:    | October 26, 1989, Instrument No. 89-1723964, of  Official Records |
| Affects:     | As Set Out Therein                                                |

 

Said matter is shown on the ALTA Survey prepared by R.B. Engineering onApril 20, 1996, last updated March 5, 2007.

13.                                                                A covenant and agreement entitled “Covenantand Agreement Regarding Maintenance of Yards for an Oversized Building”
| Executed by: | Lincoln Whitehall Realty, L.L.C., a Delaware Limited  Liability company |
|--------------|-------------------------------------------------------------------------|
| In favor of: | City of Los Angeles                                                     |
| Recorded:    | December 17, 1996, Instrument No. 96-2036452, of  Official Records      |

 

Which among other things provides: matters pertaining to maintenancve ofyards

Reference is hereby made to said document for full particulars.

This covenant and agreement shall run with the land and shall be bindingupon any future owners, encumbrancers, their successors or assigns, and shallcontinue in effect until the advisory agency approves termination.

Said matter is shown on the ALTA Survey prepared by R.B. Engineering onApril 20, 1996, last updated March 5, 2007.

14.                                                                A deed of trust to secure an indebtedness inthe amount shown below, and any other obligations secured thereby
| Amount:      | $3,500,000.00                                                |
|--------------|--------------------------------------------------------------|
| Dated:       | April 14, 1999                                               |
| Trustor:     | Natrol Real Estate, Inc, a California corporation            |
| Trustee:     | American Securities Company, a California  corporation       |
| Beneficiary: | Wells Fargo Bank, National Association                       |
| Loan No.:    |                                                         |
| Recorded:    | May 13, 1999, Instrument No. 99-869674, of Official  Records |

 

5

----

NOTE: Amended Civil Code Section 2941, which becomes effective on January1, 2002 sets the fee for the processing and recordation of the reconveyance ofeach Deed of Trust being paid through this transaction $45.00. The reconveyancemust be clearly set forth in the Beneficiary’s Payoff Demand Statement (“Demand”).In addition, an assignment or authorized release of the fee, from theBeneficiary to the Trustee of the record, must be included. an example of therequired language is as follows:

“The beneficiary identified above hereby assignsreleases or transfer to the Trustee of record, the sub of $45.00, includedherein as “Reconveyance Fee”, for the processing and recordation of theReconveyance of the Deed of Trust securing the indebtedness covered hereby, andthe escrow company or title processing this pay-off is authorized to deduct theReconveyance Fee from this Demand and forward said fee to the trustee of recordor the successor Trustee under the Trust Deed to be paid off in Full.”

In the event that the reconveyance fee and the assignment, release ortransfer are not included within the Demand Statement, then Fidelity NationalTitle Insurance Company and its Underwritten Agent may decline to process thereconveyance and will be forced to return all documentation directly to theBeneficiary for compliance with the requirements of the revised statute.

An assignment of the beneficial interest under said deed of trust whichnames:
| Assignee: | LaSalle Bank National Association, as trustee for  Bear Stearns Commercial Mortgage Securities Inc., Commercial Pass-Through  Certificates, Series 2000-WF1 |
|-----------|-------------------------------------------------------------------------------------------------------------------------------------------------------------|
| Loan No.: |                                                                                                                                                        |
| Recorded: | May 19, 2000, Instrument No. 00-781146, of Official  Records                                                                                                |

 

15.                                                                An unrecorded lease with certain terms,covenants, conditions and provisions set forth therein as disclosed by thedocument
| Entitled: | Subordination Agreement                                      |
|-----------|--------------------------------------------------------------|
| Lessor:   | Natrol Real Estate, Inc                                      |
| Lessee:   | Natrol Inc                                                   |
| Recorded: | May 13, 1999, Instrument No. 99-869675, of Official  Records |

 

The present ownership of the leasehold created by said lease and othermatters affecting the interest of the lessee are not shown herein.

16.                                                                Matters contained in that certain documententitled “Mortgage Agreement” dated August 25, 2006, executed by and betweenWachovia Capital Finance Corporation (Western), a California corporation andLaSalle Bank National Association, as Trustee of the Bear Stearns CommercialMortgage Securities Inc., Commercial Mortgage Pass-Through Certificates, Series2000-WF1 recorded November 6, 2006, Instrument No. 06-2462986, of OfficialRecords, which document, among other things, contains or provides for: As setOut Therein.

Reference is hereby made to said document for full particulars.

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17.                                                                This Company will require the followingdocuments for review prior to the issuance of any title assurance predicatedupon a conveyance or encumbrance by the corporation named below.
| Corporation: | Natrol Real Estate, Inc., a California corporation,                                                                                      |
|--------------|------------------------------------------------------------------------------------------------------------------------------------------|
|         |                                                                                                                                     |
| (a)          | A copy of the corporation By-Laws and Articles of  Incorporation.                                                                        |
|         |                                                                                                                                     |
| (b)          | An original or certified copy of the Resolution  authorizing the transaction contemplated herein.                                        |
|         |                                                                                                                                     |
| (c)          | If the Articles and/or By-Laws require approval by a  “parent” organization, a copy of the Articles and By-Laws of the parent. |

 

The right is reserved to add requirements or additional items aftercompletion of such review.

18.                                                                The transaction contemplated in connectionwith this Report is subject to the review and approval of the Company’sCorporate Underwriting Department. The Company reserves the right to addadditional items or make further requirements after such review.

19.                                                                Any rights of the parties in possession of aportion of, or all of, said land, which rights are not disclosed by the publicrecord.

This Company will require, for review, a full and complete copy of anyunrecorded agreement, contract, license and/or lease, together with all supplements,assignments and amendments thereto, before issuing any policy of titleinsurance without excepting this item from coverage. The Company reserves theright to except additional items and/or make additional requirements afterreviewing said documents.

20.                                                                In order to complete this report, thisCompany requires a Statement of Information to be completed by the followingparty,
| Party: | All Parties |
|--------|-------------|

 

The Company reserves the right to add additional items or make furtherrequirements after review of the requested Statement(s) of Information.

21.                                                                The application for title insurance wasplaced by reference to only a street address or tax identification number.

Based on our records, we believe that the description in this reportcovers the parcel requested, however, if the legal description is incorrect anew report must be prepared.

If the legal description is incorrect, in order to prevents delays, theseller, buyer and/or borrower must provided the company and/or the settlementagent with the correct legal description intended to be the subject of thistransaction.

**END OFITEMS**

Note 1.                                         The current owner does NOT qualify for the$20.00 discount pursuant to the coordinated stipulated judgments entered in actionsfiled by both the Attorney General and private class action plaintiffs for theherein described property.

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Note 2.                                         NOTE: The policy of title insurance willinclude an arbitration provision. The Company or the insured may demandarbitration. Arbitrable matters may include, but are not limited to, anycontroversy or claim between the Company and the insured arising out of orrelating to this policy, any service of the Company in connection with itsissuance or the breach of a policy provision or other obligation. Please askyour escrow or title officer for a sample copy of the policy to be issued ifyou wish to review the arbitration provisions and any other provisionspertaining to your Title Insurance coverage.

Note 3.                                         None of the items shown in this report willcause the Company to decline to attach CLTA Endorsement Form 100 to an ExtendedCoverage Loan Policy, when issued.

Note 4.                                         The Company is not aware of any matters whichwould cause it to decline to attach the CLTA Endorsement Form 116 indicating thatthere is located on said land Commercial known as 21411 Prairie Street (ChatsworthArea), Los Angeles, CA to an Extended Coverage Loan Policy.

Note 5.                                         California Revenue and Taxation Code Section18662, effective January 1, 1994 and by amendment effective January 1, 2003,provides that the buyer in all sales of California Real Estate may be requiredto withhold 3 and 1/3% of the total sales price as California State Income Tax,subject to the various provisions of the law as therein contained.

Note 6.                                         There are NO deeds affecting said land,recorded within twenty-four (24) months of the date of this report.

Note 7.                                         WIRE INSTRUCTIONS
| COMERICA BANK CALIFORNIA               |
|----------------------------------------|
| Financial  Services Group              |
| 2321 Rosecrans  Avenue, Suite 1225     |
| El Segundo, CA,  90245                 |
|                                   |
| Routing No.  121137522                 |
| For Credit to  FIDELITY NATIONAL TITLE |
|                                   |
| Account No.  1891608570                |
| Attn: Payoff  Department               |
| Ref: Order No.  19505131               |
| Title Officer:  Jon Legg               |

 
|  | **Fidelity  National Title Company**

OF CALIFORNIA |
|--|-----------------------------------------------------|

 

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**Notice**

You may be entitled toreceive a $20.00 discount on escrow services if you purchased, sold orrefinanced residential property in California between May 19, 1995 and November1, 2002. If you had more than one qualifying transaction, you may be entitledto multiple discounts.

If your previous transactioninvolved the same property that is the subject of your current transaction, youdo not have to do anything; the Company will provide the discount, provided youare paying for escrow or title services in this transaction.

If your previous transactioninvolved property different from the property that is the subject of yourcurrent transaction, you must - prior to the close of the current transaction -inform the Company of the earlier transaction, provide the address of theproperty involved in the previous transaction, and the date or approximate datethat the escrow closed to be eligible for the discount.

Unless you inform theCompany of the prior transaction on property that is not the subject of this transaction,the Company has no obligation to conduct an investigation to determine if youqualify for a discount. If you provide the Company information concerning aprior transaction, the Company is required to determine if you qualify for adiscount which is subject to other terms and conditions.

Effective through November1, 2014

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Fidelity National Financial Group of Companies’Privacy Statement

July 1, 2001

Werecognize and respect the privacy expectations of today’s consumers and therequirements of applicable federal and state privacy laws. We believe thatmaking you aware of how we use your non-public personal information (°PersonalInformation±),and to whom it is disclosed, will form the basis for arelationship of trust between us and the public that we serve. This PrivacyStatement provides that explanation. We reserve the right to change thisPrivacy Statement from time to time consistent with applicable privacy laws.

Inthe course of our business, we may collect Personal Information about you fromthe following sources:

Fromapplications or other forms we receive from you or your authorizedrepresentative;

Fromyour transactions with, or from the services being performed by, us, ouraffiliates, or others;

Fromour internet web sites;

Fromthe public records maintained by governmental entities that we either obtaindirectly from those entities, or from our affiliates or others; and 

From consumer or other reporting agencies.

OurPolicies Regarding the Protection of the Confidentiality and Security of YourPersonal Information

Wemaintain physical, electronic and procedural safeguards to protect yourPersonal Information from unauthorized access or intrusion. We limit access tothe Personal Information only to those employees who need such access in connectionwith providing products or services to you or for other legitimate businesspurposes.

OurPolicies and Practices Regarding the Sharing of Your Personal Information

We may share your Personal Information withour affiliates, such as insurance companies, agents, and other real estatesettlement service providers. We also may disclose your Personal Information:

toagents, brokers or representatives to provide you with services you haverequested;  

tothird-party contractors or service providers who provide services or performmarketing or other functions on our behalf; and

to others with whom we enter into jointmarketing agreements for products or services that we believe you may find ofinterest.

Inaddition, we will disclose your Personal Information when you direct or give uspermission, when we are required by law to do so, or when we suspect fraudulentor criminal activities. We also may disclose your Personal Information whenotherwise permitted by applicable privacy laws such as, for example, whendisclosure is needed to enforce our rights arising out of any agreement,transaction or relationship with you.

Oneof the important responsibilities of some of our affiliated companies is torecord documents in the public domain. Such documents may contain your PersonalInformation.

Rightto Access Your Personal Information and Ability to Correct Errors or RequestChanges or Deletion

Certainstates afford you the right to access your Personal Information and, undercertain circumstances, to find out to whom your Personal Information has beendisclosed. Also, certain states afford you the right to request correction,amendment or deletion of your Personal Information. We reserve the right, wherepermitted by law, to charge a reasonable fee to cover the costs incurred inresponding to such requests.

Allrequests must be made in writing to the following address:
|        | Privacy Compliance Officer         |   |
|--------|------------------------------------|--------|
|   | Fidelity  National Financial, Inc. |   |
|   | 601 Riverside  Avenue              |   |
|   | Jacksonville, FL  32204            |   |

 

MultipleProducts or Services

Ifwe provide you with more than one financial product or service, you may receivemore than one privacy notice from us. We apologize for any inconvenience thismay cause you.

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