Binding Letter of Intent RLD1

Binding Letter of Intent[RLD1]

Diamond Acquisition Group, LLC (“Buyer”) and Tower Associates, Inc., (“Seller”), do agree, on this the 31stday of October, 2011 that Buyer shall purchase, and Seller shall sell real estate (the “Property”) located at 1050 – 1056 Chelsea Drive, Beverly Hills, Californiaunder[RLD2] the following terms and conditions:

Purchase price:Three Million Dollars ($3,000,000 )

Buyer shall ____ pay cash _X_ get[RLD3] a mortgage loan in connection with the purchase. If a mortgage loan is being obtained the purchase is contingent upon Buyer obtaining a mortgage of _75_% of the purchase price at an interest rate not to exceed 6.5%and One (1)points and other fees in connection with the mortgage loan. Buyer shall choose the mortgage lender it wishes to apply to and shall choose the escrow agent and title company.

Settlement shall be on or before[RLD4]_December 31, 2011_.

Buyer shall put up a good faith escrow deposit of five percent of the purchase price after all due diligence documents and materials(see attachment “A” hereto) are provided by Seller to Buyer and ten days past when Buyer completes physical inspection of the property. A title company or attorney of Buyer’s choice shall hold the deposit. If Buyer defaults Seller can keep the escrow deposit as liquidated damages as its sole and exclusive remedy.

Seller shall provide all documents set forth in Attachment “A” hereto to Buyer within five business days of Seller executing this Letter of Intent. The due diligence period shall not begin until Seller has provided all documents set forth in Attachment “A” hereto and notified Buyer that the documents are complete.

Due diligence shall end[RLD5]forty-five days after Seller provides all documents and information set forth in Attachment “A” hereto to Buyer. That date shall be the “Due Diligence End Date.”

Buyer shall be entitled to have one or morePhysical inspection(s) of the property upon demand between today and the Due Diligence End Date as well as on the day of settlement. The inspections shall be of any and all aspects of the property. If the results of the inspections are not satisfactory to Buyer, Buyer may terminate this Letter of Intent or Agreement of Sale and receive Buyer’s deposit back. Buyer shall also be entitled to evaluate the current zoning applicable to the property, environmental conditions at the Property, the rent roll, the actual income and expenses and all other materials and information discovered during due diligence and in the event any of the figures or facts discovered during due diligence on the Property are not satisfactory to Buyer then Buyer may cancel this agreement or any subsequent agreement of sale or other agreement pertinent to the Property and in such case Buyer shall receive any and all deposits back and may cancel this transaction and have no further liability towards Seller in connection with this attempted purchase and sale of the Property.

The title on the property as of closing must be marketable title and as of the date of the title commitment the total debt (liens, mortgages, deeds of trust and otherwise) against the property shall be equal to or less than the sale price less the seller’s expenses of sale (commissions, transfer tax, loan and lien payoffs, etc.). By signing below Seller represents that the total debt today is less than the purchase price less the costs of sale and debt payoffs set forth above.

Buyer may assign this Agreement at its sole and absolute discretion.

Seller agrees not to negotiate with or accept offers from any other parties for thirtydays[RLD6] from the date of this Agreement to allow time for the parties to negotiate and execute an agreement of sale.

Either party may record this agreement in the county records where the real estate sits.

Parties shall split the costs of title insurance, transfer tax and settlement costs with 50% being paid by Seller, 50% being paid by Buyer.

Buyer’s attorney, at Buyer’s cost, shall prepare an agreement to reflect the above terms. Buyer and Seller understand that the agreement of sale and will contain additional terms deemed necessary or desirable by the Buyer’s attorney. Seller agrees to accept any commercially reasonable agreement drafted by the attorney so long as it reflects the above terms plus other terms deemed necessary by the attorney[RLD7]. It is intended that this Letter of Intent be binding until a final Agreement of Sale is agreed to and executed by both parties to this agreement

By signing below, Buyer and Seller agree to the above and intend to be legally bound.

SellerBuyer

Tower Associates, LPDiamond Acquisition Group, LLC

By Property Management Corp., Its

General Partner

______[RLD8]______

BY: Anita WillsmeyerBY: Robert Diamond

President, Property Management Corp.Its: Manager

Attest

______

BY: Brenden Hayes

Secretary

______

DateDate

ATTACHMENT “A”

DUE DILIGENCE MATERIALS TO BE PROVIDED BY SELLER[RLD9].

Within five days of executing this Agreement Seller agrees to provide true and correct copies of the following to Buyer (the “Due Diligence Materials”):

(a) A current rent roll (the “Rent Roll”), which is a true and accurate schedule of leases, tenants, and rents presently being collected by Seller. The Rent Roll shall include the amounts of all rental and damage deposits retained by Seller, a list of any prepaid rent, and any tenants who are occupying space within the Property without a lease or other written agreement with. The Rent Roll shall also list any and all decorating, installation, and alteration work which Seller may be obligated to perform under any written or oral agreement with any tenant or occupant in the Property. Seller also agrees to provide a copy of any and all leases or occupancy agreements with any person(s);

(b) A schedule of insurance (the “Insurance List”) carried on the premises, a copy of the insurance bills or invoices for the twenty four months immediately preceding this Agreement, and any notices or requests that have been received by Seller from any insurance company issuing any of the policies;

(d) A true and correct copy of any notices that have been received by Seller from the holders of any mortgage, deed of trust or any other instrument securing debt against the property regarding any default under the terms of the instrument;

(e) A copy of any notices of any violations of any building, housing, fire, safety, or similar ordinance or regulation with regard to the premises;

(f) A copy of water, gas, and electrical utility bills relating to the premises for the twenty-four months immediately preceding this Agreement;

(g) A true and correct copy of any liens all of the personal property being sold under this Agreement such as alarm systems, washing equipment and any other items of personal property being sold under this Agreement;

(h) A statement of income and expenses in a form satisfactory to Buyer for the twenty-four months prior to the date seller enters into this Agreement;

(i) A true and correct copy of any brokerage agreements affecting the Property;

(j) A full, complete, and accurate list of all employees engaged in the operation and maintenance of the premises, giving the name, position, rate of compensation, term of employment contract or agreement, if any, and other relevant information with respect to each employee;

(k) A copy of any notices of pending or threatened condemnation or similar proceeding or assessment (special or otherwise) affecting the property, or any part of the property;

(l) A copy of all bank statements for the building covering the twenty four months prior to this Agreement showing the deposits and receipts and copies of all invoices, bills, and items deposited;

(m) A copy of any unpaid or partially paid bills outstanding for work done to the premises or materials provided by any persons or entities that have not been paid for, nor any notices which may result in any mechanics' lien or materialman’s lien and a copy of any mechanics' liens or materialman’s liens against the premises; and

(n) A copy of any notices of the presence of any (i) hazardous substances, pollutants or contaminants (as defined in Section 101 of the Comprehensive Environmental Response, Compensation and Liability Act (CERCLA), 42 U.S.C. section 9601, as amended by the Superfund Amendments and Re authorization Act of 1986 (Pub. L.. No. 99499, 100 Stat. 1613 (1986) (SARA) or 40 CFR Part 261, whichever is applicable) in, on, about or near the Property.

If, in the sole and absolute discretion of Buyer any of the Due Diligence Materials are not satisfactory in either form or substance, Buyer may, at any time prior to settlement hereunder cancel this Agreement, receive any and all deposits back and have no further liability to Seller or any other party under this Agreement. Until Seller provides all Due Diligence Materials to Buyer the due diligence period will not begin.

ATTACHMENT “B”

Legal Description of the Property

Alternate Clauses for Letter of Intent

(if you wish to use these insert them into the body of the letter of intent)

Owner shall keep insurance on the property and shall be responsible for loss at the property due to fire, flood, windstorm, lightning or other insurable hazard, and shall keep insurance in force on the property until it is sold to Buyer.

Seller will take back a mortgage of $______that shall balloon in _____ months, shall make payments monthly until the loan is due. The payments shall be calculated on a _____ year amortization at _____% annual interest or shall be interest only at ____% annualinterest. (Pickamortizing or interest only, strike out the other)

Alternate signature Blocks for Letter of Intent

Individual Seller and Buyer

SellerBuyer

______

DateDate

Corporation Seller and Individual Buyer

SellerBuyer

The ABC Corporation, a Pennsylvania

Corporation

______

BY: David Jones

Title: President

Attest:

______

BY: Anita Williams

Title: Secretary

______

DateDate

Estate Seller and Corporate Buyer

SellerBuyer

The Estate of Sandy WhartonHanson Property Trading, Inc.,

A California Corporation

______

BY: Rhonda H. WhartonBY: H. Harold Hanson

Title: ExecutrixTitle: President

______

DateDate

Limited Partnership (LP) as Seller and LLC as Buyer. Note with an LP you will always have an entity acting as the General Partner within the limited partnership and thus the parties are more in that form.

SellerBuyer

______, LP[RLD10]______

By[RLD11] ______., Its

General Partner

______

BY:BY:

President[RLD12],Its:

Attest

______

BY: Secretary[RLD13]

______

DateDate

Instructions:

These are notary affidavits for use with my forms.

Use these in conjunction with any document you want notarized such as a deed, mortgage or other document you want recorded in the public records.

You MUST have any document you want to record in the county real estate records (such as a deed, mortgage, agreement of sale, etc.) notarized or it cannot be recorded!

Notarization is also a good idea if you do not want to give someone the chance to say they did not sign something.

There are separate forms of Notary Affidavits I have included for individuals, corporations, partnerships, Administrators, Administratrixes (this term is sometimes used for a female Administrator), and Executors.

Be aware that Executor is a term for a person appointed by the Court to administer the estate in Texas (and perhaps other states as well) but also refers to the person appointed in the Will to administer the Will. It is important that you only deal with someone who is appointed by the Court to administer the property in the estate. In most states that person is called the “Administrator” or “Administratrix.”

You cannot legally be sold property or bind an estate by an Executor who is only appointed in the Will, but is not formally appointed by the Court to administer the property in the estate. Be sure the Court appoints the person you are dealing with before you settle on real estate! They are usually going to be called the Administrator but if they are called the Executor in your estate just be sure they are court-appointed, not just appointed in the Will.

ACKNOWLEDGMENT BY INDIVIDUAL

State of ______:

SS:

County of ______:

On this ______day of ______[month, year], before me, a ______[official title] in and for ______County, came the above named ______[name] and acknowledged the foregoing deed to be ______[his or her] act and deed, and desired the same to be recorded as such.

Witness my hand and seal, the day and year aforesaid.

Seal

______[Signature]

______[Title]

My commission expires ______[date].

ACKNOWLEDGMENT BY CORPORATION

State of ______:

SS:

County of ______:

On this ______day of ______[month, year], before me, ______[name of officer], the undersigned officer, personally appeared ______[name], who acknowledged ______[himself or herself] to be the ______[title] of ______[name of corporation], a corporation, and that ______[he or she] as ______[title], being authorized to do so, executed the foregoing instrument for the purposes contained in it by signing the name of the corporation by ______[himself or herself] as ______[title].

In witness whereof, I hereto set my hand and official seal.

[Seal]

______[Signature]

______[Title]

ACKNOWLEDGMENT BY PARTNERSHIP

State of ______:

SS:

County of ______:

On this ______day of ______[month, year], before me, ______[name of officer], the undersigned officer, personally appeared ______[name of partner], who acknowledged ______[himself or herself] to be a partner in ______[name of partnership], a partnership, and that ______[he or she], being authorized to do so, executed the foregoing instrument for the purposes contained in it by signing the name of the partnership by ______[himself or herself] as partner.

In witness whereof, I hereto set my hand and official seal.

[Seal]

______[Signature]

______[Title]

My commission expires ______(date).

ACKNOWLEDGMENT BY AN ADMINISTRATOR OF AN ESTATE

State of ______:

SS:

County of ______:

On this ______day of ______[month, year], before me, ______[name of notary], personally appeared the undersigned ______[name of Administrator] who acknowledged himself/herself to be the lawfully appointed Administrator of the Estate of ______, and that ______[he or she] as such Administrator, being authorized to do so, executed the foregoing instrument for the purposes contained in it by signing his/her name as said Administrator.

In witness whereof, I hereto set my hand and official seal.

[Seal]

______[Signature]

______[Title]

ACKNOWLEDGMENT BY AN ADMINISTRATRIX OF AN ESTATE

State of ______:

SS :

County of ______:

On this ______day of ______[month, year], before me, ______[name of notary], personally appeared the undersigned ______[name of Administratrix] who acknowledged herself to be the lawfully appointed Administrator of the Estate of ______, and that she as such Administrator, being authorized to do so, executed the foregoing instrument for the purposes contained in it by signing her name as said Administratrix.

In witness whereof, I hereto set my hand and official seal.

[Seal]

______[Signature]

______[Title]

ACKNOWLEDGMENT BY AN EXECUTOR OF AN ESTATE

State of ______:

SS:

County of ______:

On this ______day of ______[month, year], before me, ______[name of notary], personally appeared the undersigned ______[name of Executor] who acknowledged himself/herself to be the lawfully appointed Executor of the Estate of ______, and that ______[he or she] as such Executor, being authorized to do so, executed the foregoing instrument for the purposes contained in it by signing his/her name as said Executor.

In witness whereof, I hereto set my hand and official seal.

[Seal]

______[Signature]

______[Title]

Instructions:

These are notary affidavits for use with my forms.

Use these in conjunction with any document you want notarized such as a deed, mortgage or other document you want recorded in the public records.

You MUST have any document you want to record in the county real estate records (such as a deed, mortgage, agreement of sale, etc.) notarized or it cannot be recorded!

Notarization is also a good idea if you do not want to give someone the chance to say they did not sign something.

ACKNOWLEDGMENT BY INDIVIDUAL

State of ______:

SS:

County of ______:

Witness my hand and seal, the day and year aforesaid.

Seal

______[Signature]

______[Title]

My commission expires ______[date].

ACKNOWLEDGMENT BY CORPORATION

State of ______:

SS:

County of ______:

In witness whereof, I hereto set my hand and official seal.

[Seal]

______[Signature]

______[Title]

ACKNOWLEDGMENT BY PARTNERSHIP

State of ______:

SS:

County of ______: