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EXHIBIT 10.1.3
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AMENDMENT NO. 3 TO
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PURCHASE AND SALE AGREEMENT AND
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JOINT ESCROW INSTRUCTIONS
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THIS AMENDMENT NO. 3 TO PURCHASE AND SALE AGREEMENT AND JOINT ESCROW
INSTRUCTIONS (this "Amendment") is made and entered into and effective as of
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August 15, 2000, by and between KAISER VENTURES INC., a Delaware corporation,
and KAISER STEEL LAND DEVELOPMENT, INC., a Delaware corporation (collectively,
"Seller"), and CCG ONTARIO, LLC, a Delaware limited liability company ("Buyer").
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RECITALS
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A. WHEREAS, Buyer and Seller have entered into that certain Purchase and
Sale Agreement and Joint Escrow Instructions dated as of July 13, 2000, as
amended by that certain Amendment No. 1 to Purchase and Sale Agreement and Joint
Escrow Instructions dated as of July 20, 2000, and that certain Amendment No. 2
to Purchase and Sale Agreement and Joint Escrow Instructions dated July 27, 2000
and that certain side letter amendment dated August 11, 2000 (as amended, the
"Purchase Agreement");
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B. WHEREAS, Buyer and Seller desire to amend the Purchase Agreement, as
more particularly set forth herein.
NOW, THEREFORE, in consideration of the mutual covenants and agreements
herein contained and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Buyer and Seller hereby agree as
follows:
AGREEMENT
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1. Amendments. The Purchase Agreement is hereby amended as follows:
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A. Recital C of the Purchase Agreement is hereby revised to read
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in full as follows:
C. WHEREAS, in consideration for Buyer's agreement to (i)
assume certain contractual indemnification and other obligations of Seller
which are specifically agreed to by Buyer; (ii) remediate existing
Hazardous Substances contamination at, under, above, adjacent to and/or
emanating to or from the Real Property and/or the Tar Pits Property; (iii)
assume certain liabilities associated with the Real Property and/or the
Adjacent Property; and (iv) other good and valuable consideration, Seller
desires to sell the Real Property and Other Assets (defined in Section 1.37
below) to Buyer on the terms and conditions set forth herein.
B. Recital D of the Purchase Agreement is hereby revised to read
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in full as follows:
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D. WHEREAS, Buyer desires to purchase the Real Property and
Other Assets from Seller and to undertake an obligation to (i) assume
certain contractual indemnification and other obligations of Seller
which are specifically agreed to by Buyer; (ii) remediate existing
Hazardous Substances contamination at, under, above, adjacent to
and/or emanating to or from the Real Property and/or, subject to the
provisions of Section 10.7 hereof, the Tar Pits Property; and (iii)
assume certain liabilities associated with the Real Property and/or
the Adjacent Property on the terms and conditions set forth herein.
C. Section 1.45 of the Purchase Agreement is hereby revised to
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delete the last sentence thereof and replace it with the following:
The Parties acknowledge and agree that (i) the shares of Fontana
Union Water Company, a mutual water company, which are owned by Kaiser
Ventures, Inc. and/or its subsidiary, Fontana Water Resources, Inc.,
and (ii) the water well located on the Budway Property, and its
related facilities and easement which are currently used by California
Speedway Corporation are not included within the definitions of Land,
Real Property, Property or Other Assets.
D. Section 4.6 of the Purchase Agreement is amended to add the
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following phrase to the end of the first sentence thereof:
and the other obligations described in Article 10 below.
E. Section 5.2.10 of the Purchase Agreement is hereby revised to
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read in full as follows:
5.2.10 Buyer and Seller have agreed upon the provisions of that
certain Members Operating Agreement of West Valley MRF, LLC, dated
June 19, 1997, and of that certain Performance Guaranty and
Indemnification Agreement by Kaiser Ventures Inc. in favor of West
Valley Recycling & Transfer, Inc. and West Valley MRF to be assigned
to Buyer as a Material Agreement.
F. Section 5.3.3 of the Purchase Agreement is hereby revised to
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read in full as follows:
5.3.3 Buyer has delivered to Escrow Holder original counterparts
of the Bill of Sale, the License, the Omnibus Assignment and
Assumption Agreement, the Assignment of Certain Lease Rights, the MRF
Easements and the Deed, duly executed by Buyer and acknowledged, where
appropriate.
G. Section 10.2.2 of the Purchase Agreement is amended to delete
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the second sentence thereof and replace it with the following:
Prior to the Close of Escrow, Seller shall remove from the Real
Property, transport and dispose of or otherwise lawfully manage all
Hazardous Substances known to be stored in containers on the Real
Property other than materials stored
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in the drums referred to in Section 2.11.5 of the "scope of work"
attached to the IT Contract with ITG.
H. Section 10.3.2 of the Purchase Agreement is hereby revised to
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add the following as a new clause (i): (i) all reasonable costs incurred in
connection with obtaining access for remediation purposes over the Budway
Property, the Rancho Cucamonga Property, the D.T. Sari Property and the Maas
Hansen Property as depicted on Exhibit A-1 attached hereto; provided that for
purposes of this clause (i), once Seller has provided to Buyer a license, access
agreement, easement or other similar instrument or Buyer has otherwise obtained
adequate access to such property, Seller shall only be liable for costs and
liabilities to the extent they arise from the delay in gaining or providing such
access. The amendment to Section 10.3.1 of the Purchase Agreement contained in
Amendment No. 1 to the Purchase Agreement is hereby deleted.
I. Section 10.3.3.2 of the Purchase Agreement is hereby revised to
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amend clause (iii) and to add clause (iv) as follows: (iii) following the
occurrence of a Default, in connection with Seller's enforcement of the
performance bond or the IT Contract in accordance with the terms hereof and
thereof, or (iv) in the manner permitted pursuant to Section 10.9.4 herein.
J. Section 10.3.4 of the Purchase Agreement is hereby revised to
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read in full as follows:
10.3.4 Indemnification by Buyer. Except only for the Excluded
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Liabilities and Losses (as hereinafter defined) arising out of
Seller's failure to make any payments required of Seller pursuant to
the first paragraph of Section 10.7 hereof, Buyer agrees to assume,
indemnify, hold harmless and defend Seller and its past, current and
future members, affiliates, subsidiaries and each of their officers,
directors, employees, agents and representatives (collectively, the
"Seller Parties" except that the term "Seller Parties" shall not
include The California Speedway Corporation, International Speedway
Corporation, a Florida corporation (successor by merger with PSH
Corp., a Delaware corporation), 88 Corp. (successor by merger to
Penske Motorsports, Inc., formerly known as Penske Speedway Holding
Corp.), Speedway Development Corporation, and Penske Holdings
Corporation (collectively, the "Speedway Entities"), or the West
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Valley MRF (the "MRF") or their members (other than Kaiser Recycling
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Corporation), managers, officers, directors, employees or agent unless
such officers, directors, employees or agents are or were also
officers, directors, employees or agents of Seller) from and against
any and all Environmental Liabilities and Obligations, and from and
against any and all liabilities, penalties, fines, suits, claims,
demands, actions, losses, damages, expenses, investigation and
remediation costs (including, but not limited to, laboratory,
handling, transportation, containment, neutralization, disposal,
capping and other similar costs), operation and maintenance costs,
financial assurance costs (other than costs of Seller's existing
financial assurances), Agency costs (including, but not limited to,
permitting, licensing, hazardous waste taxes and oversight costs),
causes of action, proceedings, judgments, executions
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and reasonable costs of any kind or nature whatsoever (including
reasonable attorneys', consultants', engineers', experts' and
contractors' fees) (collectively, "Losses") in connection with,
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arising out of or related to: (a) any Corrective Action; (b)
compliance or noncompliance with any Requirements; (c) the existence
of any threat to health, safety or the environment under any Laws, or
the presence or alleged presence or release of any Hazardous
Substances on, under, at or from the Real Property or the Tar Pits
Property; (d) Buyer and ITG's compliance or non compliance with any
Law in connection with the Real Property or the Adjacent Property; (e)
the breach of this Agreement or any Exhibit attached hereto and
incorporated herein by Buyer except for consequential damages incurred
by Seller and arising out of such breach (as distinct from
consequential damages incurred by third parties and recovered or
recoverable from Seller which third party consequential damages shall
be recoverable hereunder); (f) any breach of the IT Contract or the
performance and completion bond, as defined in Section 10.4 below and
(g) personal injury, including death and disability, occurring on or
after the Close of Escrow caused to employees, contractors, invitees
or guests or any other persons at or from the Real Property to the
extent such injury is not related to Hazardous Substances conditions
at the Real Property or the Adjacent Property; provided, however, that
this subparagraph (g) of Section 10.3.2 shall not be deemed to limit
Buyer's assumption and responsibility for any claims (whether arising
prior to, as of or after the Close of Escrow) as provided in this
Agreement or in any exhibit hereto related to Hazardous Substances
conditions that were or are at or from the Real Property and/or the
Adjacent Property. The carve out of the Speedway Entities or the MRF
from the term Seller Parties is not intended to nor shall it be
construed or deemed to limit Buyer's liability or obligations under
any provision of the Omnibus Assignment and Assumption Agreement or to
limit any rights the MRF and the Speedway Entities may have for
indemnification under the Assigned Items assumed by Buyer under the
Omnibus Assignment and Assumption Agreement.
In addition, except for (1) the Excluded Liabilities, (2) Losses
arising out of Seller's failure to make any payments required of
Seller pursuant to the first paragraph of Section 10.7 hereof, (3)
Losses realized by the Seller Parties (or any of them) for diminution
in value of the Real Property or the Adjacent Property resulting from
one or more of the Seller Parties' inability to use the Real Property
or the Adjacent Property for a desired purpose, and (4) Losses
realized by the Seller Parties or any of them pursuant to any
contracts or other agreements which any of the Seller Parties is a
party to (which Losses shall be assumed and indemnified against only
to the extent provided for in the Omnibus Assignment and Assumption
Agreement), Buyer shall assume and indemnify, defend and hold the
Seller Parties harmless from and against all Losses arising out of the
presence during Seller's ownership of the Adjacent Property of
Hazardous Substances in, on or under the Adjacent Property in
violation of applicable Laws. Notwithstanding the immediately
foregoing sentence, Buyer does not assume, indemnify, or hold harmless
under the immediately preceding sentence any Seller Party from or
against any obligation (i) that would require a Seller Party to
remediate any property (other than the Real Property) for a use that
is prohibited
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by any recorded restrictive covenant in effect on that property on the
date of the Close of Escrow or that would require any Seller Party to
indemnify any party for any loss arising from such party's or any
other party's inability to use any property (other than the Real
Property) for a use prohibited by such restrictive covenants, or (ii)
to indemnify or defend any party from, or to pay any party for, the
following types of damages or Losses, to the extent such damages or
Losses arise out of or as a result of the existence of Hazardous
Substances in, on, under or about the Adjacent Property as of the date
the Adjacent Property was sold by Seller except to the extent
emanating from the Real Property and do not arise as a result of a
knowing act or knowing failure to act of Buyer, in either case, which
(x) at the time of such act or failure to act, Buyer had knowledge or
reason to know that such act or failure to act would significantly
increase the likelihood of a remediation effort materially slower than
contemplated under this Agreement or the Assigned Items and (y)
actually results in a remediation effort materially slower than
contemplated: (A) any diminution in value of the Adjacent Property,
(B) increased costs to operate the Adjacent Property, (C) increased
finance costs associated with the Adjacent Property, (D) increased
development or construction costs on the Adjacent Property, or (E) any
party's inability to use the Adjacent Property or the interruption of
any business or other activity on the Adjacent Property (the foregoing
clauses (ii)(A) through (E) being referred to herein as the
"Diminution in Value Losses"). Any indemnification and defense to be
provided pursuant to this Section 10.3.4 shall be conducted in
accordance with the procedures set forth in Section 14, below.
K. Section 10.3.6 of the Purchase Agreement is hereby revised to
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read in full as follows:
10.3.6 Indemnification by Seller. Seller agrees to indemnify,
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hold harmless and defend Buyer and its members, affiliates and
subsidiaries and each of their past, current and future officers,
directors, employees, agents and representatives (other than the OVI
Group as defined in Section 15.19 below or ITG or any affiliate
thereof) from and against any and all liabilities, penalties, fines,
suits, claims, demands, actions, losses, damages, expenses,
investigation and remediation costs (including, but not limited to,
laboratory, handling, transportation, containment, neutralization,
disposal, capping and other similar costs), operation and maintenance
costs, financial assurance costs, Agency costs (including, but not
limited to, permitting, licensing, hazardous waste taxes and oversight
costs), causes of action, proceedings, judgments, executions and
reasonable costs of any kind or nature whatsoever (including
reasonable attorneys', consultants', engineers' and contractors' fees)
in connection with, arising out of or related to any Excluded
Liabilities except for (a) consequential damages incurred by Buyer
arising out of Seller's breach of this Agreement or any Exhibit hereto
(as distinct from consequential damages incurred by third parties as a
result of Seller's breach of this Agreement and recovered or
recoverable from Buyer which third party consequential damages shall
be recoverable hereunder) and (b) notwithstanding anything to the
contrary contained in the Omnibus Assignment and Assumption Agreement
attached
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hereto as Exhibit P (including, without limitation, Section 2(e)
thereof), any obligations or liabilities related to or arising from
any acts or omissions of the MRF or Speedway Entities occurring on or
after the Effective Date (as defined in the Omnibus Assignment and
Assumption Agreement) and (c) Diminution in Value Losses. Any
indemnification and defense to be provided pursuant to this Section
10.3.6 shall be conducted in accordance with the procedures set forth
in Section 14, below.
L. Section 10.4 of the Purchase Agreement is hereby revised to
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read in full as follows:
10.4 IT Contract. As an inducement to execute this Agreement,
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Seller is relying upon, and hereby approves and consents to, Buyer's
retention of ITG and LandBank, Inc., (each, a "Consultant") for the
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Corrective Action at or near the Real Property and/or the Tar Pits
Property and the operations and maintenance on the Real Property
and/or Adjacent Property pursuant to a fixed-priced contract between
Buyer and ITG and a remediation services agreement with LandBank, Inc.
(the contracts, together with the lien and completion bond issued to
secure performance thereof and the multiple obligee agreement, are
collectively, the "IT Contract"), the forms of which shall be attached
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hereto as Exhibit Q. Seller shall be an express third party
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beneficiary of the IT Contract and an obligee of the performance bond.
Buyer shall have no obligation to obtain Seller's consent to any
termination or amendment of the IT Contract after the Close of Escrow
except for amendments relating to the Tar Pits Property; provided,
however, Buyer shall provide Seller with written notice of any such
termination and any modification which significantly reduces the scope
of work to be performed by IT where such work is still required to be
performed by an Agency. If Buyer terminates the IT Contract or
modifies it to significantly reduce the scope of work to be performed
by IT where such work is still required to be performed by any Agency,
Buyer shall, within a reasonable period of time, enter into a contract
providing for performance of the remaining Corrective Action or the
Corrective Action no longer covered by the IT Contract but still
required to be performed by any Agency. Seller shall be named as a
third party beneficiary of such contract and, if a bond is provided
under such contract, Seller shall be named as an additional obligee
under such bond and be a party to a multiple obligee agreement. Buyer
shall deliver to Seller copies of any such replacement contract and,
if issued, such bond. Buyer shall also, at the request of Seller,
make a representative reasonably available to consult with Seller with
respect to such replacement contract, and, if, within a reasonable
period of time prior to the date when such replacement contract is
intended to be signed, Seller requests that such meeting be held prior
to entry into the replacement contract, Buyer shall provide Seller
with a copy of the draft contract and shall make itself reasonably
available to consult with Seller prior to execution of the replacement
contract. Buyer acknowledges that it does not have any current
intention or expectation of terminating the IT Contract after the
Close of Escrow. Buyer hereby agrees that if the Consultant defaults
under the IT Contract, Buyer shall enforce its rights under the IT
Contract (including, without limitation, the bonds) so long as the IT
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Contract secured by such bonds remains in effect, provided that this
Agreement shall not prohibit Buyer from terminating the IT Contract
with or without cause.
M. Pursuant to Section 5.2.20 of the Purchase Agreement, Seller was
to deliver to Buyer the MRF's consent to the assignment and assumption of
Seller's and Kaiser Recycling Corporation's ("KRC") rights and obligations under
the Material Agreements relating to the MRF (identified on Exhibit B to the
Omnibus Assignment and Assumption Agreement as a "MRF Agreement") on the terms
contained in the Omnibus Assignment and Assumption Agreement. Buyer has agreed
to waive the condition precedent regarding delivery of the MRF consent pre-
closing. Notwithstanding anything to the contrary contained in the Omnibus
Assignment and Assumption Agreement, Buyer and Seller agree that the assignment
and assumption of the rights and obligations of Seller and KRC under the
Material Agreements relating to the MRF shall be of no force or effect prior to
delivery of the MRF's consent thereto in a form reasonably acceptable to Buyer.
Upon delivery of such consent, however, such assignment and assumption shall be
effective as of the Close of Escrow. Nothing herein shall be deemed or construed
to abrogate or modify Buyer's obligations under this Agreement relative to the
Tar Pits Property.
N. Section 10.7 of the Purchase Agreement is amended to add the
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words "immobilization and" prior to the word "capping" in lines 6, 11 and 12
thereof and to add the following paragraph as the second paragraph thereof:
Buyer agrees that it shall comply with and assume as of the Close
of Escrow any and all obligations and/or requirements to inspect,
maintain and secure the Tar Pits Property, including without
limitation, weed control, maintenance and repair of any bird netting,
fencing and signage at Buyer's cost and expense.
O. Section 10.9 of the Purchase Agreement is hereby revised to
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read in full as follows:
10.9 Default by Buyer.
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10.9.1 Buyer shall be deemed to have defaulted in its
obligations (a "Default") and agreements set forth in Section 10.3.3.1
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hereof and the last sentence of the first paragraph of Section 10.7
hereof with respect to subparagraph (d) below if:
(a) any of the work described in the scope of work to be
attached to the Remediation Stop Loss Insurance Policy (Capital Costs)
has been abandoned for a period of two hundred forty (240) consecutive
days; or
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(b) all work included in the definition of Corrective Action
has not been completed on the Real Property and/or the Tar Pits
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Property and/or any operations, maintenance and monitoring obligations
Buyer has assumed under this Agreement and/or the Omnibus Assignment
and Assumption Agreement and/or which arise out of Buyer's Consent
Order (collectively, the "O&M Obligations") and all of the following
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events occur:
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(i) An Agency seeks in a written notice to have Seller
perform Corrective Action with respect to the Real Property or
the Tar Pits Property and/or any of the O&M Obligations; and
(ii) Seller gives Buyer written notice of the Agency's
written notice or order; and
(iii) Buyer fails to respond to the Agency and timely
commence taking the appropriate action or entering into good
faith negotiations with such Agency; and
(iv) As a result of Buyer's failure to take appropriate
action in response to such Agency notice or order, Agency
performs Corrective Action and/or any of the O&M Obligations and
submits a claim or invoice against Seller for the cost of such
performance; and
(v) Buyer does not pay the costs described in clause (iv)
above within thirty (30) days after receipt of a demand from
Seller hereunder or provide a bond or other security for such
costs reasonably acceptable to Seller so that Seller is not
obligated to pay such costs to the Agency.
Notwithstanding the foregoing, if, after the occurrence of clause
(b)(i) and (b)(ii) above, and despite Buyer's compliance with clause
(b)(iii), above, an Agency issues an order on Seller requiring Seller
to perform Corrective Action and/or any of the O&M Obligations, and
the cost of performing or failure to perform such Corrective Action
and/or any of the O&M Obligations (including, without limitation,
fines, penalties and/or interest for failure to perform) will or may
in the aggregate exceed $250,000 and, based on the opinion of a "big
5" or other nationally recognized accounting firm reasonably
acceptable to Buyer, which firm is not then retained by Seller for
audit purposes, Seller will be required to disclose such order in its
SEC filings and reserve against the costs of performing or failing to
perform such order, Buyer shall be in Default hereunder if Buyer has
not provided such surety or bonds as are necessary to avoid the
reserve requirement of Seller within ninety (90) days of written
notice by Seller to Buyer of such reserve requirement; or
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(c) Buyer breaches its obligation to make the deposit, if
required, under Section 10.9.4.1 below; or
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(d) Buyer breaches its obligation to make the deposits, if
required, under Section 10.9.10 below.
10.9.2 If a Default occurs as defined in Section 10.9.1 and so
long as such Default is continuing, then Seller shall have the right
to take such steps as necessary to cure such Default which, with
respect to a Default under (c) and (d) above shall include the right
to take over the Corrective Action (including the right to enter onto
the Real Property pursuant to the easement for remediation purposes
reserved by Seller in the Deed) and to recover from Buyer the costs
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reasonably expended or due and payable by Seller to cure such Default.
If Seller elects to undertake steps to cure all or any portion of such
Default, then Seller shall be obligated to continue such steps as are
necessary to cure the portion of the Default until Seller provides
Buyer with written notice of its intent to cease such self-help
remedies and thereafter Seller shall cease such self help remedies in
accordance with such notice. In addition, Seller shall have the right
to exercise all rights and remedies afforded to Seller under the CDC
Guaranty in a similar manner and fashion against Buyer.
10.9.3 Buyer hereby assigns to Seller, on a non-exclusive basis,
without releasing Buyer from any of its obligations under this
Agreement or under the Omnibus Assignment and Assumption Agreement, to
the extent necessary to exercise Seller's self-help rights after the
occurrence and during the continuance of a Default, or pursuant to
Section 10.9.4 or pursuant to Section 10.9.10, to the extent such
items are assignable:
(a) any and all governmental and regulatory licenses,
permits, authorizing approvals or entitlements, whether now or
hereafter acquired, pertaining to the Corrective Action or the O&M
Obligations, as applicable,
(b) any and all contracts, warranties, reports or rights
pertaining to the Corrective Action or the O&M Obligations, as
applicable, whether now or hereafter acquired, including, without
limitation, any of the Assigned Items (as such term is defined in the
Omnibus Assignment and Assumption Agreement) to the extent pertaining
to the Corrective Action or the O&M Obligations, as applicable, and
(c) any rights assigned to Buyer pursuant to the Assignment
and Assumption of Certain Lease Rights, and
(d) the IT Contract.
The assignment contained in this Section 10.9.3 is made without
recourse or warranty. The enumeration of the categories to be
assigned in clauses (a)-(d) above shall not be deemed a representation
or warranty by Buyer as to the existence of any such rights, and all
rights being assigned under this Section 10.9.3 are being assigned on
an "AS IS," "WHERE IS," "WITH ALL FAULTS" basis, without any
representation or warranty of any kind or nature of Buyer, express,
implied or statutory, as to the nature of the rights assigned under
this Section 10.9.3 or their fitness for Seller's intended use or
their assignability or enforceability.
10.9.4 For purposes of this Section 10.9.4, the word "completed"
shall mean the date upon which Buyer has received and delivered to
Seller a No Further Action Letter for the East Slag Pile parcel or
received and delivered to Seller a Certificate of Completion for the
East Slag Pile parcel or provides Seller
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notice that the East Slag Pile parcel has been endorsed onto the Real
Estate Environmental Liability Insurance Policy.
10.9.4.1 If at the end of the sixth year of the term of the
Remediation Stop Loss Insurance Policy, Buyer has not completed
the "scope of work" attached to the Remediation Stop Loss
Insurance Policy for the East Slag Pile parcel, Buyer shall be
obligated, at its expense, to deposit cash into a pledged account
in an amount equal to the difference between (i) Eight Million
Eight Hundred One Thousand Two Hundred and Eleven Dollars
($8,801,211.00) and (ii) the amount of funds Buyer has reasonably
paid to third parties to date on completing the "scope of work"
on the East Slag Pile parcel; provided that the amount to be
deposited in the cash account shall not exceed Five Million
Dollars ($5,000,000). Notwithstanding the foregoing, if all of
the Guaranteed Obligations other than completion of the "scope of
work" for the East Slag Pile parcel have been completed, the
amount required to be deposited by Buyer under Section 10.9.4.1
above may be reduced by the amount of the Maximum Liability
Amount (as defined in the Guaranty) as of the date such deposit
is required under this Section 10.9.4.1.
10.9.4.2 If at the end of the seventh year of the
Remediation Stop Loss Insurance Policy, Buyer has not completed
the "scope of work" attached to the Remediation Stop Loss
Insurance Policy for the East Slag Pile parcel, then
notwithstanding the absence of a Default, Seller shall be
entitled to exercise its self-help remedies under Section 10.9.2
and 10.9.3 with respect to the non-completed portion of the
"scope of work" for the East Slag Pile parcel and may, together
with Buyer, draw upon the cash collateral account described in
this Section 10.9.4 to complete such "scope of work" on the East
Slag Pile parcel.
10.9.4.3 Following completion of the "scope of work" for
the East Slag Pile parcel and payment of amounts incurred in
connection therewith (subject to good faith disputes), any
amounts deposited pursuant to Section 10.9.4.1 above shall be
promptly released to Buyer.
10.9.5 Following the deposit of the amount due under Section
10.9.4.1 above, Buyer, and following the end of the seventh year of
the Remediation Stop Loss Insurance Policy, Buyer, Seller and CDC (to
the extent any amount has been drawn under the CDC Guaranty), shall be
entitled to draw against such cash account solely for the purposes of
paying third party costs incurred in connection with performing the
"scope of work" on the East Slag Pile parcel by delivering to the
account holder a statement (the "East Slag Pile Draw Certification")
certifying that the amount requested in such draw has been incurred
with third parties in the performance of such "scope of work" and, if
the self-insured retention amount under the Remediation Stop Loss
Insurance Policy has not been paid in full and such policy remains in
effect, that to the best knowledge of the certifying person after due
inquiry (which for purposes of this provisions shall mean review of
the
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Remediation Stop Loss Insurance Policy language and exclusions
applicable to determining what costs are applicable to the self-
insured retention amount), is applicable toward the self-insured
retention amount under the Remediation Stop Loss Insurance Policy.
10.9.6 If a draw is requested by Buyer or CDC under Section
10.9.5, Seller shall have twenty (20) days from delivery of the East
Slag Pile Draw Certification to review such East Slag Pile Draw
Certification. If Seller does not object to such East Slag Pile Draw
Certification during such twenty (20) day period, then the holder of
the cash account shall disburse to Buyer or CDC, as the case may be,
the amount of funds requested in the East Slag Pile Draw
Certification. If during such twenty (20) day period Seller submits
to Buyer or CDC, as applicable, a written certification that it has
reviewed the East Slag Pile Draw Certification (and, if the self-
insured retention amount under the Remediation Stop Loss Insurance
Policy has not been paid in full and such policy remains in effect,
the Insurance Policies) and the documents described in Section 10.9.8
below and believes, based upon such review and after consultation with
counsel, that the amount requested in the East Slag Pile Draw
Certification is not applicable toward third party costs incurred in
the performance of the East Slag Pile parcel "scope of work" (and, if
the self-insured retention amount under the Remediation Stop Loss
Insurance Policy has not been paid in full and such policy remains in
effect, the self-insured retention amount under the Remediation Stop
Loss Insurance Policy), then Buyer and Seller (and CDC, as applicable)
agree to promptly meet to resolve the dispute in good faith, and
failing to resolve such dispute within five (5) business days of
Seller's written certification, shall thereafter submit such dispute
to an expedited reference proceeding as described in Section 10.9.9
below. Notwithstanding any disagreement between Buyer or CDC, as
applicable, and Seller, and notwithstanding Seller's objection to the
East Slag Pile Draw Certification in the manner set forth above, if a
Zurich Entity notifies Buyer and/or Seller that the amount requested
in the East Slag Pile Draw Certification is applicable toward the
self-insured retention amount under the Stop Loss Policy (Capital
Costs), then the account holder is entitled to disburse, and shall
immediately disburse, to Buyer or CDC, as applicable, the amounts of
funds requested in the East Slag Pile Draw Certification unless Seller
is objecting to such draw certification on the grounds that the funds
requested are not being applied toward third party costs incurred in
performing the "scope of work" for the East Slag Pile Parcel.
10.9.7 Subject to Section 10.9.6 above, the cash account shall
provide that the account holder shall be unconditionally obligated to
disburse to Buyer, Seller or CDC (whichever entity has requested
funds) the amount of funds requested by such party in its East Slag
Pile Draw Certification upon receipt of such East Slag Pile Draw
Certification. The account holder shall expressly acknowledge and
agree that it shall be obligated to disburse to Buyer or Seller
(whichever entity has requested funds) the amount of funds requested
in its East Slag Pile Draw Certification notwithstanding contrary
instructions from the other party.
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10.9.8 Any person seeking to draw against such cash collateral
delivered pursuant to Section 10.9.4.1 shall deliver to any requesting
person such invoices, receipts or other evidence of payment reasonably
requested by such person to evidence that funds drawn or to be drawn
from the cash collateral account have been incurred in connection with
performance of the "scope of work" and are applicable toward the self-
insured retention amount; provided, however, that subject to the
requirements of Section 10.9.6 above, in no event shall the delivery
of such documentation be a condition to the making or receipt of a
draw against the cash collateral.
10.9.9 Any controversy preventing the disbursement of funds to
Buyer or Seller, as applicable, pursuant to a East Slag Pile Draw
Certification under Section 10.9.5 above or a Tar Pits Property Draw
Certification under Section 10.9.12 below shall be promptly heard in
San Bernardino County, California by a reference proceeding pursuant
to the provisions of California code of Civil Procedure Sections 638
through 645.1, inclusive. The parties hereto shall agree upon a
single referee who shall try all issues of fact and law and report his
or her decisions thereon. If the parties are unable to agree upon a
referee, then any party hereto may thereafter seek to have one
appointed pursuant to California Code of Civil Procedure Sections 638
and 640. The cost of such proceeding shall initially be borne equally
by the parties to the dispute. However, the prevailing party in such
proceeding shall be entitled, in addition to all other costs, to
recover its contribution for the cost of the reference and its
attorneys' fees and expenses as an item of damage and/or recoverable
cost. The referee shall not be bound by formal rules of evidence and
may admit such evidence as determined by him or her to be relevant and
probative of the issues raised by the reference. The referee may
employ such experts not associated with, employed by, or affiliated
with any party as he or she determines are necessary to aid him or her
in deciding the reference.
10.9.10 The following provisions relate to the Tar Pits
Property.
10.9.10.1 If, on the date which is eighteen (18) months
after the Close of Escrow, Buyer has not completed the
immobilization/ solidification portion of the "scope of work"
attached to the Remediation Stop Loss Insurance Policy for the
Tar Pits Property, (a) Buyer shall be obligated, at its expense,
to deposit cash into a pledged account in an amount equal to the
difference between (i) Two Million Eight Hundred Thirty Six
Thousand Eight Hundred Seventy Three Dollars ($2,836,873) and
(ii) the amount of funds Buyer has reasonably paid to third
parties to date on completing the "scope of work" on the Tar Pits
Property and (b) notwithstanding the absence of a Default, Seller
shall be entitled to exercise its self-help remedies under
Section 10.9.2 and 10.9.3 with respect to the non-completed
portion of the "scope of work" for the Tar Pits Property and may,
together with Buyer, draw upon the cash collateral account
described in this Section 10.9.10 to complete such "scope of
work" on the Tar Pits Property. Notwithstanding the foregoing,
if all of
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the Guaranteed Obligations other than completion of the "scope of
work" for the Tar Pits Property have been completed, the amount
required to be deposited by Buyer under Section 10.9.10.1 above
may be reduced by the amount of the Maximum Liability Amount (as
defined in the Guaranty) as of the date such deposit is required
under this Section 10.9.10.1.
10.9.10.2 If, on the date which is twenty-seven (27) months
after the Close of Escrow, Buyer has not completed the "scope of
work" attached to the Remediation Stop Loss Insurance Policy for
the Tar Pits Property (which, for purposes of this Section
10.9.10.2 and 10.9.10.3 below, shall mean the date upon which
Buyer has received and delivered to Seller a No Further Action
Letter for the Tar Pits Property or received and delivered to
Seller a Certificate of Completion for the Tar Pits Property or
provides Seller notice that the Tar Pits Property has been
endorsed onto the Real Estate Environmental Liability Insurance
Policy) then (a) Buyer shall be obligated, at its expense, to
deposit cash into a pledged account in an amount equal to the
difference between (i) Two Million Eight Hundred Thirty Six
Thousand Eight Hundred Seventy Three Dollars ($2,836,873) and
(ii) the amount of funds Buyer has reasonably paid to third
parties to date on completing the "scope of work" on the Tar Pits
Property and (b) notwithstanding the absence of a Default, Seller
shall be entitled to exercise its self-help remedies under
Section 10.9.2 and 10.9.3 with respect to the non-completed
portion of the "scope of work" for the Tar Pits Property and may,
together with Buyer, draw upon the cash collateral account
described in this Section 10.9.10.2 to complete such "scope of
work" on the Tar Pits Property. Notwithstanding the foregoing,
if all of the Guaranteed Obligations other than completion of the
"scope of work" for the Tar Pits Property have been completed,
the amount required to be deposited by Buyer under Section
10.9.10.2 above may be reduced by the amount of the Maximum
Liability Amount (as defined in the Guaranty) as of the date such
deposit is required under this Section 10.9.10.2.
10.9.10.3 Following completion of the "scope of work" for
the Tar Pits Property and payment of amounts incurred in
connection therewith (subject to good faith disputes), any
amounts deposited pursuant to Section 10.9.10.1 and/or 10.9.10.2
above shall be promptly released to Buyer.
10.9.11 Following the deposit of the amount due under
Section 10.9.10.1 and/or 10.9.10.2 above, Buyer, Seller and CDC (to
the extent any amount has been drawn under the CDC Guaranty), shall be
entitled to draw against such cash account solely for the purposes of
paying third party costs incurred in connection with performing the
"scope of work" on the Tar Pits Property by delivering to the account
holder a statement (the "Tar Pits Property Draw Certification")
certifying that the amount requested in such draw has been incurred
with third parties in the performance of such "scope of work" and, if
the
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<PAGE>
self-insured retention amount under the Remediation Stop Loss
Insurance Policy has not been paid in full and such policy remains in
effect, that to the best knowledge of the certifying person after due
inquiry (which for purposes of this provisions shall mean review of
the Remediation Stop Loss Insurance Policy language and exclusions
applicable to determining what costs are applicable to the self-
insured retention amount), is applicable toward the self-insured
retention amount under the Remediation Stop Loss Insurance Policy.
10.9.12 If a draw is requested by Buyer or CDC under Section
10.9.11, Seller shall have twenty (20) days from delivery of the Tar
Pits Property Draw Certification to review such Tar Pits Property Draw
Certification. If Seller does not object to such Tar Pits Property
Draw Certification during such twenty (20) day period, then the holder
of the cash account shall disburse to Buyer or CDC, as the case may
be, the amount of funds requested in the Tar Pits Property Draw
Certification. If during such twenty (20) day period Seller submits
to Buyer or CDC, as applicable, a written certification that it has
reviewed the Tar Pits Property Draw Certification (and, if the self-
insured retention amount under the Remediation Stop Loss Insurance
Policy has not been paid in full and such policy remains in effect,
the Insurance Policies) and the documents described in Section 10.9.14
below and believes, based upon such review and after consultation with
counsel, that the amount requested in the Tar Pits Property Draw
Certification is not applicable toward third party costs incurred in
the performance of the Tar Pits Property "scope of work" (and, if the
self-insured retention amount under the Remediation Stop Loss
Insurance Policy has not been paid in full and such policy remains in
effect, the self-insured retention amount under the Remediation Stop
Loss Insurance Policy), then Buyer and Seller (and CDC, as applicable)
agree to promptly meet to resolve the dispute in good faith, and
failing to resolve such dispute within five (5) business days of
Seller's written certification, shall thereafter submit such dispute
to an expedited reference proceeding as described in Section 10.9.9
above. Notwithstanding any disagreement between Buyer or CDC, as
applicable, and Seller, and notwithstanding Seller's objection to the
Tar Pits Property Draw Certification in the manner set forth above, if
a Zurich Entity notifies Buyer and/or Seller that the amount requested
in the Tar Pits Property Draw Certification is applicable toward the
self-insured retention amount under the Remediation Stop Loss
Insurance Policy, then the account holder is entitled to disburse, and
shall immediately disburse, to Buyer or CDC, as applicable, the
amounts of funds requested in the Tar Pits Property Draw Certification
unless Seller is objecting to such draw certification on the grounds
that the funds requested are not being applied toward third party
costs incurred in performing the "scope of work" for the Tar Pits
Property.
10.9.13 Subject to Section 10.9.12 above, the cash account shall
provide that the account holder shall be unconditionally obligated to
disburse to Buyer, Seller or CDC (whichever entity has requested
funds) the amount of funds requested by such party in its Tar Pits
Property Draw Certification upon receipt of such Tar Pits Property
Draw Certification. The account holder shall expressly
14
<PAGE>
acknowledge and agree that it shall be obligated to disburse to Buyer
or Seller (whichever entity has requested funds) the amount of funds
requested in its Tar Pits Property Draw Certification notwithstanding
contrary instructions from the other party.
10.9.14 Any person seeking to draw against such cash collateral
delivered pursuant to Section 10.9.10.1 or 10.9.10.2 above shall
deliver to any requesting person such invoices, receipts or other
evidence of payment reasonably requested by such person to evidence
that funds drawn or to be drawn from the cash collateral account have
been incurred in connection with performance of the "scope of work"
and are applicable toward the self-insured retention amount; provided,
however, that subject to the requirements of Section 10.9.12 above, in
no event shall the delivery of such documentation be a condition to
the making or receipt of a draw against the cash collateral.
10.9.15 Each of the rights and remedies provided in this
Agreement is cumulative and not exclusive of, and shall not prejudice,
any other right or remedy provided in this Agreement. No failure or
delay on the part of Seller in exercising any right or remedy shall
operate as a waiver of such right or remedy; nor shall any single or
partial exercise of any right or remedy preclude any other or further
exercise of such right or remedy or of any other right or remedy.
P. Section 15.1 is amended to provide that any side letters executed
------------
between the Parties as of the Closing Date shall be deemed incorporated into
this Agreement.
Q. Section 15.18 is hereby added to the Purchase Agreement:
-------------
15.18 Joint and Several Liability. The obligations of Kaiser
Steel Land Development Inc. and Kaiser Ventures Inc. under this
Agreement shall be joint and several. Kaiser Steel Land Development
Inc. and Kaiser Ventures Inc. each agree that Buyer has no obligation
to proceed against either Kaiser Steel Land Development Inc. or Kaiser
Ventures Inc. or exhaust any other remedy in the power of Buyer, and
the failure of Buyer to do so shall not exonerate, release or
discharge Kaiser Steel Land Development Inc. or Kaiser Ventures Inc.
from their absolute, unconditional and independent obligations
hereunder.
R. Section 15.19 through 15.22 are added to the Purchase Agreement
---------------------------
as follows:
15.19 Disclosures Made By Seller. Buyer acknowledges and agrees
that for purposes of this Agreement and its exhibits, OVI is solely
responsible for disclosing to Buyer all disclosures previously made by
Seller to OVI and its members, agents and representatives, including
LandBank Environmental Properties, LLC and LandBank, Inc.
(collectively the "OVI Group") and Buyer agrees that Seller may rely
on OVI's disclosure of such matters to Buyer and waives any claim
based on a failure of Seller to disclose matters to Buyer if Seller
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<PAGE>
previously disclosed such matters to any member, agent or
representative of one or more of the OVI Group.
15.20 Omnibus Assignment and Assumption Agreement. It is the
express intent of Buyer and Seller to transfer to Buyer and have Buyer
assume and indemnify Seller and the other Seller Parties from and
against all of the Assigned Items to the extent provided in the
Omnibus Assignment and Assumption Agreement. The assumption and
indemnification obligations imposed therein shall be binding upon
Buyer, whether or not the Omnibus Assignment and Assumption Agreement
is ever challenged or considered ineffective or deemed unenforceable.
Notwithstanding anything to the contrary contained in the Omnibus
Assignment and Assumption Agreement concerning the exclusive nature of
any assignment made thereunder, in the event Buyer is in breach of its
obligations under such document, Seller Parties hereby reserve their
rights under the Assigned Items assumed under the Omnibus Assignment
and Assumption Agreement by Buyer, on a non-exclusive basis, and
following notice to Buyer and a thirty (30) day opportunity to cure,
to defend any claims made against the Seller Parties under such
Assigned Items and to perform during the pendency of such breach any
obligations required in connection therewith, but only to the extent
such performance is required to reduce damages the Seller Parties
would be subject to, absent performance under such Assigned Items.
Such non-exclusive reservation by Seller Parties in the event of such
a breach by Buyer is not intended to nor shall it be deemed or
construed to relieve Buyer from any of its obligations under the
Omnibus Assignment and Assumption Agreement or under this Agreement,
including, without limitation, its obligations to assume and indemnify
Seller Parties for the matters for which Buyer has agreed to assume
and/or provide indemnification under the Omnibus Assignment and
Assumption Agreement and/or this Agreement.
15.21 Cooperation on Insurance Policies; Status of Insurance
Policies. The Parties agree to cooperate with one another in making
claims against the Insurance Policies. Buyer agrees that if Seller
makes any payments against the self-insured retention under the
Remediation Stop Loss Insurance Policy, Seller shall be deemed to have
made such payment as Buyer's "authorized representative" for purposes
of Seller's ability to make claims under the policy. The Parties
represent and warrant to each other that it has not obtained and will
not obtain at the Closing any other environmental insurance policies
concerning the Real Property and/or Adjacent Property other than the
Insurance Policies. The Parties represent and warrant to each other
that it does not have any side agreements with any of the Zurich
Entities concerning or relating to the Insurance Policies and that all
agreements with the Zurich Entities are contained within the language
of the Insurance Policies.
15.22 Manifesting Substances. Buyer shall be responsible for
signing as the generator all manifests required for the removal and/or
disposal of Hazardous Substances and non Hazardous Substances and
wastes from the Real Property and the Adjacent Property; provided,
however, that one of Seller Parties
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<PAGE>
shall be responsible for signing as the generator all manifests
required for the removal and/or disposal of Hazardous Substances and
non Hazardous Substances and wastes from the Tar Pits Property.
S. Exhibit A to the Purchase Agreement is hereby revised in full and
---------
attached hereto as Exhibit A.
----------
T. Exhibit C to the Purchase Agreement is hereby revised in full and
---------
attached hereto as Exhibit C.
---------
U. Exhibit F to the Purchase Agreement is hereby revised in full and
---------
attached hereto as Exhibit F. Notwithstanding anything which could be construed
---------
to the contrary contained in the Grant Deed, the property conveyed by the Grant
Deed shall not include the trailer owned by Johnson Bail Bonds.
V. Exhibit G to the Purchase Agreement is hereby revised in full and
---------
attached hereto as Exhibit G.
----------
W. Exhibit H to the Purchase Agreement is hereby revised in full and
---------
attached hereto as Exhibit H.
---------
X. Exhibit I to the Purchase Agreement is hereby revised in full and
---------
attached hereto as Exhibit I.
---------
Y. Exhibit K to the Purchase Agreement is hereby revised in full and
---------
attached hereto as Exhibit K.
---------
Z. Exhibit L to the Purchase Agreement is hereby revised in full and
---------
attached hereto as Exhibit L.
---------
AA. Exhibit M to the Purchase Agreement is hereby revised in full and
---------
attached hereto as Exhibit M.
---------
BB. Exhibit P to the Purchase Agreement is hereby revised in full and
---------
attached hereto as Exhibit P.
---------
CC. Exhibit Q to the Purchase Agreement is hereby revised in full and
---------
attached hereto as Exhibit Q.
---------
DD. Exhibit U to the Purchase Agreement is hereby ratified as the
---------
final Exhibit U.
---------
EE. Exhibit X to the Purchase Agreement is hereby revised in full and
---------
attached hereto as Exhibit X.
---------
FF. Exhibit Y to the Purchase Agreement is hereby revised in full and
---------
attached hereto as Exhibit Y.
---------
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GG. Exhibit AA to the Purchase Agreement is hereby deleted in its
----------
entirety.
HH. Exhibit BB to the Purchase Agreement is hereby revised in full
----------
and attached hereto as Exhibit BB.
----------
II. Exhibit CC to the Purchase Agreement is hereby revised in full
----------
and attached hereto as Exhibit CC.
----------
JJ. Exhibit DD to the Purchase Agreement is hereby revised in full
----------
and attached hereto as Exhibit DD.
----------
KK. Exhibit EE to the Purchase Agreement is hereby revised in full
----------
and attached hereto as Exhibit EE.
----------
2. No Other Amendments. Except as expressly amended hereby, the Purchase
-------------------
Agreement is unchanged and in full force and effect.
3. Counterparts. This Amendment may be executed in counterparts, each of
------------
which shall be an original and all of which taken together shall constitute the
same instrument.
[SIGNATURES ON NEXT PAGE]
-------------------------
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IN WITNESS WHEREOF, the parties hereto have executed this Amendment as of
the dates written below.
Buyer: CCG ONTARIO, LLC,
----- a Delaware limited liability company
By: /s/ Charles A. McPhee
-------------------------
Charles A. McPhee
Its: Vice President
Date Executed: August 15, 2000
Seller: KAISER VENTURES INC.,
------ a Delaware corporation
By: /s/ Lee R. Redmond
----------------------------------
Name: Lee R. Redmond
--------------------------------
Its: Sr. Vice President - Real Estate
--------------------------------
Date Executed: August 15, 2000
KAISER STEEL LAND DEVELOPMENT, INC.,
a Delaware corporation
By: /s/ Lee R. Redmond
--------------------------------
Name: Lee R. Redmond
-------------------------------
Its: Vice President - Real Estate
--------------------------------
Date Executed: August 15, 2000
S-1
<PAGE>
RECEIVED AND ACCEPTED THIS ____ DAY OF ____________________, 2000.
ESCROW HOLDER:
CHICAGO TITLE INSURANCE COMPANY
By:___________________________
Name: ________________________
Its:__________________________
S-2
<PAGE>
Exhibits Available Upon the Written
===================================
Request of the
==============
Securities and Exchange Commission
==================================
