Purchase and Sale Agreement And Joint Escrow Instructions

Exhibit 10.1

Purchase and Sale Agreement
And Joint Escrow Instructions

     This Purchase and Sale Agreement and Joint Escrow Instructions (this “Agreement” ), dated as of June 29, 2009 (the “ Effective Date ”), is by and between AZPRO DEVELOPMENTS, INC. , an Arizona corporation ( “Seller” ) , and SHOPOFF ADVISORS, L.P., a Delaware limited partnership ( “Buyer” ), and constitutes an agreement for the purchase and sale of real property and joint escrow instructions directed to First American Title Insurance Company (as “Escrow Holder” ) to establish an escrow (the “Escrow” ) to accommodate the transaction contemplated hereby.

RECITALS:

     A. Seller owns approximately 200 gross acres of land situated in the Town of Buckeye (the “Town” ), County of Maricopa (the “County” ), State of Arizona, as more particularly described in Exhibit “A” attached hereto and incorporated herein by this reference (the “Land” ).

     B. The term “ Appurtenant Rights” shall mean all of Sellers’ right, title and interest, if any, in and to any rights and appurtenances pertaining to the Land, development rights (including without limitation, tentative maps, site plan approvals, permits and authorizations issued by federal and state regulatory agencies), roads, alleys, easements, streets and ways appurtenant to the Land, rights of ingress and egress thereto. The Appurtenant Rights also include the right to use the unregistered name “Desert Moon Estates”. The Land and the Appurtenant Rights shall sometimes hereinafter be referred to collectively as the “Property” .

     C. Seller wishes to sell the Property to Buyer, and Buyer wishes to purchase the Property from Seller, all under the terms and conditions contained herein.

     NOW THEREFORE, in consideration of the foregoing recitals, and the mutual covenants contained herein, the receipt and sufficiency of which are hereby acknowledged, Buyer and Seller hereby agree as follows:

      1.  Purchase and Sale . Seller agrees to sell the Property to Buyer and Buyer agrees to purchase the Property from Seller, on and subject to the terms and conditions hereinafter set forth.

      2.  Purchase Price . The “Purchase Price” for the Property shall be Three Million Dollars ($3,000,000.00) all cash at Closing (as hereinafter defined).

      3.  Payment of Purchase Price . The Purchase Price shall be paid as follows:

     a. Not later than 5:00 PM (Phoenix Time) on the third (3 ^rd ) business day following the Effective Date, Buyer, as a condition precedent to this Agreement becoming a binding agreement between the parties, shall deposit into the Escrow by confirmed wire transfer of immediately available federal funds, the amount of Fifty Thousand Dollars ($50,000.00) (the “First Deposit” ).

     b. If Buyer has elected to proceed with the purchase of the Property prior to or upon expiration of the Due Diligence Period (defined below), Buyer shall deposit into Escrow by confirmed wire transfer of immediately available federal funds, the additional sum of One Hundred Thousand Dollars ($100,000.00) (the “ Second Deposit ”). The First Deposit and the Second Deposit shall become non-refundable to Buyer upon Escrow Holder’s receipt of the Second Deposit, except upon a termination of this Agreement as a result of (i) Seller’s material default under this Agreement occurring prior the Close of Escrow, or (ii) the failure of any material condition precedent to Buyer’s obligation to purchase the Property expressly stated herein.

     c. If Buyer fails to deposit the First Deposit or the Second Deposit within the time period provided for above, Seller may at any time prior to Escrow Holder’s receipt of the First Deposit or Second Deposit, as applicable, terminate this Agreement and the Escrow by giving written notice to Buyer and Escrow Holder, in which case this Agreement shall be null and void ab initio and in such event Escrow Holder will immediately deliver to Seller all copies of this Agreement in its possession and, thereafter, neither party shall have any further rights or obligations to the other hereunder, except as otherwise set forth in this Agreement. The First Deposit, together with the Second Deposit shall sometimes collectively be referred to herein as the “Deposit” . The Deposit and all interest on that portion of the Deposit while in Escrow during the term of this Agreement, shall be credited in favor of Buyer against the Purchase Price for the Property upon the Close of Escrow, but shall be (i) paid to Seller if Seller is entitled to receive the Deposit in accordance with this Agreement, or (ii) returned to Buyer if Buyer is entitled to a return of the Deposit in accordance with this Agreement.

     d. The balance of the Base Purchase Price for the Property, together with Buyer’s share of costs to be paid and pro-rations to be made pursuant to Section 13 and Section 14 of this Agreement, shall be deposited by Buyer into the Escrow by confirmed wire transfer of immediately available federal funds, no later than 3:00 P.M. (Phoenix Time) on the last business day before the Close of Escrow and shall be disbursed to Seller by Escrow Holder upon the Close of Escrow.

      4.  Opening and Close of Escrow .

     a. Opening of Escrow . For the purposes of this Agreement, the “Opening of Escrow” shall mean the date that Escrow Holder receives the First Deposit and executed counterpart copies (delivered or by facsimile transmission) of this Agreement signed by Buyer and Seller. Escrow Holder shall notify Buyer and Seller, in writing, of the date of Opening of Escrow. Buyer and Seller agree to execute, deliver and be bound by any reasonable and customary supplemental instructions that may be reasonably requested by Escrow Holder or that may be necessary or convenient to consummate the transaction contemplated hereby; provided , however , that such supplemental instructions shall be consistent with and shall not supersede this Agreement and in all cases this Agreement shall control.

     b. Close of Escrow . For purposes of this Agreement, the “Close of Escrow” with respect to the Property shall mean the date on which a Special Warranty Deed executed by Seller conveying the title to the Land, substantially in the form attached hereto as Exhibit “B” (the “Warranty Deed” ), is recorded in the Official Records of the County.

     c. Date of Close of Escrow; Outside Date . The Close of Escrow for the Property shall occur on July 30, 2009 at the office of Escrow Holder or at such other location in Phoenix, Arizona, at the parties may mutually agree in writing.

      5.  Buyer’s Contingencies . For the benefit of Buyer, Buyer’s obligation to consummate the transaction contemplated in this Agreement shall be expressly subject to and contingent upon Buyer’s written approval or written waiver of each of the following contingencies ( “Contingencies” ).

     a. Title Matters .

     i. First American Title Insurance Company (the “Title Company” ) has been requested to issue a title commitment (the “Title Commitment” ) covering the Land, together with copies of all exceptions referred to in the Title Commitment. Prior to the expiration of the Due Diligence Period, Buyer shall notify Seller in writing (the “Title Objections Notice” ) of those title exceptions, if any, which Buyer is unwilling to accept (such exception[s] being herein called, collectively, the “Un-permitted Exceptions” ); provided, however, Seller shall remove, and Buyer shall not be required to object to, any and all monetary liens and encumbrances executed by Seller affecting the Property and any judgment lien naming Seller as a defendant or mechanics’ liens recorded against the Property relating to work initiated by Seller (excluding non-delinquent taxes, bonds and assessments and excluding monetary obligations arising out of or relating to the Development Agreements (defined below) and the CC&Rs (defined below)) (collectively, “Seller’s Monetary Liens” ). Notwithstanding anything to the contrary herein, in no event shall the title review period specified in this Section 5.a, extend the past the date of expiration the Due Diligence Period (defined below).

          Seller discloses to Buyer that (a) the Land is subject to the Development Agreements (collectively, the “Development Agreements” ) and the Declaration of Covenants, Conditions and Restrictions regarding membership in the Central Arizona Groundwater Replenishment District (the “CC&Rs” ) described below, and (b) that the Property will be subject to any and all assessments and other amounts payable after the Close of Escrow pursuant to the Development Agreements and/or the CC&Rs, including any assessments imposed upon the Land by virtue of any assessment districts referred to in the Development Agreements or by virtue of the CC&Rs:

     (1) Development and Reimbursement Agreement Concerning the Payment of Engineering and other Professional Fees Pertaining to the Formation of an Assessment District within a Community Facilities District (Sewer and Effluent Lines), recorded in the Official Records of Maricopa County, Arizona on May 28, 2004, at Instrument No. 2004-0610172;

     (2) Development and Reimbursement Agreement Concerning the Payment of Engineering and other Professional Fees Pertaining to the Formation of an Assessment District within a Community Facilities District (Wastewater Treatment Plant), recorded in the Official Records of Maricopa County, Arizona on June 25, 2004, at Instrument No. 2004-0726243;

     (3) The Watson Road Community Facilities District (Town of Buckeye, Arizona) Waiver and Development Agreement Pertaining to Assessment District No. 1, recorded in the Official

Records of `Maricopa County, Arizona, on October 19, 2005, at Instrument No. 2005-1559019, and re-recorded on November 15, 2005, at Instrument No. 2005-1727787 (the “Waiver Agreement” ) and related documents recorded at Instrument No. 2005-1559020, Instrument No. 2005-1559021, 2005-1570264 and Instrument No. 2005-1864436;

     (4) Declaration of Covenants, Conditions and Restrictions for Desert Moon Estates Regarding Membership in the Central Arizona Groundwater Replenishment District recorded in the Official Records of Maricopa County, Arizona on April 11, 2006, at Instrument No. 2006-0483225; and

     (5) Water Facilities Offsite Extension Agreement dated January 25, 2008, between Seller, Buckeye 60, LLC, Armstrong Miller, LLC, CVS 5934 AZ, LLC, Great American Capital/Miller MarketPlace, LLC, and Buckeye 40, LLC and Valencia Water Company (the “Company” ) (the “Valencia Offsite Agreement” ) and related Letter Agreement dated January 14, 2008 between Seller and the Valencia Water Company (the “Letter Agreement” ).

     ii. Within two (2) days after the Seller receives Buyer’s Title Objection Notice, Seller shall notify Buyer in writing (a “Title Objection Response” ) whether it is unable or unwilling to remove any Un-permitted Exceptions identified in Schedule 3 or the Supplemental Title Objection Notice, as applicable, it being understood and agreed by Buyer that Seller shall have no obligation to remove any Un-permitted Exceptions. In either event, Buyer shall have the right, as its sole remedy for such inability or unwillingness of Seller, by delivery of written notice to Seller within two (2) days following receipt of notice from Seller of its election not to remove such Un-permitted Exceptions, to either (1) terminate this Agreement and the Escrow by written notice delivered to Seller and Escrow Holder (in which event the termination provisions of Section 12 below shall apply), or (2) accept title to the Property subject to such Un-permitted Exceptions without an abatement in or credit against the Purchase Price, in which event such Un-permitted Exceptions shall then become Permitted Exceptions. The failure of Buyer to deliver any written notice of election under this Section 5.a.ii within five (5) business days following receipt of written notice from Seller of its election not to remove such Un-permitted Exceptions shall conclusively be deemed to be an election under clause (1) of the preceding sentence. During the term of this Agreement, Seller shall not record any items against title to the Property or otherwise enter into any binding agreement encumbering title to the Property except as expressly permitted by this Agreement, without obtaining the prior written approval of Buyer, which shall not be unreasonably withheld, conditioned or delayed.

     iii. If, as of the Close of Escrow, in addition to Seller’s Monetary Liens, there are any monetary liens or encumbrances affecting the Land that Seller has agreed (in the exercise of its sole discretion and without any obligation) to discharge under this Agreement (collectively, the “ Un-Permitted Liens ”), Seller shall cause the discharge of the same at Seller’s sole expense, either by way of payment or by alternative manner

reasonably satisfactory to Seller and the Title Company, and the same shall not be deemed to be Un-permitted Exceptions.

     iv. The Property shall be sold and conveyed subject to the following exceptions to title (collectively, the “Permitted Exceptions” ):

     1. those matters specifically set forth in Schedule B to the Title Commitment that are accepted by Buyer as provided in this Agreement, other than Seller’s Monetary Liens and any Un-Permitted Liens;

     2. all laws, ordinances, rules and regulations of the United States, the State of Arizona, the County, the Town or any agency, department, commission, bureau or instrumentality of any of the foregoing having jurisdiction over the Property (each, a “Governmental Authority” ), as the same may now exist or may be hereafter modified, supplemented or promulgated;

     3. all presently existing and future liens of real estate taxes or assessments and water rates, water meter charges, water frontage charges and sewer taxes, rents and charges, if any; provided that such items are not yet due and payable and are apportioned as provided in this Agreement;

     4. any Un-permitted Exception which Seller is unwilling or unable to remedy as provided in this Agreement if this Agreement is not terminated by Buyer as a result thereof pursuant to Section 5.a.ii above;

     5. Any matter (including any lien, encumbrance or easement) voluntarily imposed or consented to in writing by Buyer prior to or as of the Close of Escrow; and

     6. Such state of facts as may be shown on an accurate and accurate survey or by inspection of the Property.

     v. In the event Buyer requests any endorsements to the Title Policy ( “Buyer Requested Title Endorsements” ), the issuance of any such Buyer Requested Title Endorsements shall not be deemed to be a condition to closing the transaction contemplated, except to the extent the Title Company, prior to the end of the Due Diligence Period, commits in writing to issue such Buyer Requested Title Endorsements and in no event shall Seller be obligated to provide any indemnity or other document or undertake any obligation in order to cause the Title Company to issue the same (other than for mechanic’s liens); provided , however , that Seller will reasonably cooperate, at no cost or liability to Seller, with Buyer and the Title Company in connection with the issuance of the Title Policy and Buyer Requested Title Endorsements, as the case may be.

     b. Due Diligence Reviews . Commencing on the Effective Date and ending at 5:00 PM (Phoenix Time) on July 20, 2009 (the “Due Diligence Period” ), Buyer shall have the opportunity to review and investigate the Property, in Buyer’s sole discretion, which review and investigation may include, without limitation, the following matters:

     i. The adequacy and condition of the Land and the adequacy of all utilities to the Property, including, but not limited to, power, water, gas, telephone, cable and sanitary sewer.

     ii. The condition of the soils and the geologic, environmental and engineering conditions of the Property, based on any and all soils, engineering, environmental or geologic tests, reports and studies which Buyer desires to perform, which reports, tests and studies shall be performed at Buyer’s sole cost and expense in compliance with the provisions of Section 18 below.

     iii. Any documents, instruments and agreements in Seller’s possession or control relating to the currently intended use or development of the Property but excluding confidential financial data and work product (the “Property Information Materials” ), including without limitation any geo-technical reports, engineering reports, civil engineering drawings (in electronic PDF or CADD form), lotting studies, tentative maps, site plans, surveys (including any existing ALTA surveys in Seller’s possession), a phase I environmental audit, traffic studies and drainage studies, which items have been delivered by Seller to Buyer, or made available to Buyer by Seller, prior to the Effective Date. Such reports, surveys, investigations, audits or studies have been provided or made available to Buyer as an accommodation only, and Seller makes no representation as to the accuracy or completeness of any of such reports, surveys, investigations, audits or studies (except as otherwise may be expressly stated in Section 7(a) below). Notwithstanding the foregoing, Seller has made available to Buyer and will continue to make available to Buyer for inspection during the Due Diligence Period, any and all known information in Seller’s possession or reasonably available to Seller regarding the physical condition or legal entitlements with respect to the Property, during the term of this Agreement. Seller agrees to instruct its consultants and their employees to be available to Buyer openly discuss the Due Diligence Materials prepared by or used by such consultants, but Buyer shall not have the right to request that such consultants perform additional work unless at Buyer’s sole cost and expense. Seller agrees to provide to Buyer complete copies of all permit applications submitted by Seller or its consultants and all relevant correspondence relating to all regulatory permits affecting the Property promptly following Seller’s receipt of same.

     All of the documents, instruments and agreements identified in Section 5.b. above and any other information delivered to the Buyer by Seller relating to the Property shall be referred to herein as the “Due Diligence Materials” .

     c. Buyer’s Election . If, prior to the expiration of the Due Diligence Period, Buyer deposits into Escrow the Second Deposit, then Buyer shall be deemed to have unconditionally approved the condition of the Property as provided in this Agreement (but subject to closing conditions as set forth in Section 10 below, otherwise, Buyer shall be deemed to have disapproved the condition of the Property, in which event the termination provisions of Section 12 of this Agreement shall apply.

     During the term of this Agreement, Seller further agrees to provide to Buyer, promptly following its receipt of same, copies of any additional Due Diligence Materials (being documents, reports, etc. which relate in a material way to the current physical condition of the Land) not available to Seller as of the Effective Date of this Agreement.

      6.  “AS-IS” SALE . Buyer acknowledges and agrees that Buyer is experienced in the purchase and development of land similar to the Property and that Buyer has inspected the Property, or will, during the Due Diligence Period, inspect the Property, to its satisfaction, and is qualified to make such inspections. Except for Seller’s express representations to Buyer in this Agreement, Buyer acknowledges that it is fully relying on Buyer’s (or Buyer’s representatives’ or

consultants’) inspections of the Property and not upon any statements (oral or written) which may have been made or may be made (or purportedly made) by Seller or any of its representatives or consultants, including, without limitation, the Recitals set forth above in this Agreement. No person acting on behalf of Seller is authorized to make, and by execution hereof Buyer acknowledges no person has made, any representation, statement, warranty, guaranty, or promise regarding the Property or the transaction contemplated herein, or the zoning, construction, physical condition or other status of the Property except as may be expressly set forth in this Agreement. Buyer acknowledges that Buyer, or Buyer’s representatives and/or consultants, will have the opportunity to thoroughly inspect and examine the Property to the extent deemed necessary by Buyer in order to enable Buyer to evaluate the condition of the Property and all other aspects of the Property (including, but not limited to, the environmental condition of the Property), and except to the extent of Seller’s representations set forth herein, Buyer acknowledges that Buyer will rely solely upon its own (or its representatives’ or consultants’) inspections, examinations and evaluations of the Property, as a material part of the consideration of this Agreement and the purchase of the Property.

           EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT, BUYER ACKNOWLEDGES THAT SELLER IS SELLING THE PROPERTY “AS IS” AND “WITH ALL FAULTS” AND THAT NEITHER SELLER NOR ITS AGENTS HAVE MADE ANY WARRANTIES OR REPRESENTATIONS, EXPRESS OR IMPLIED, ORAL OR WRITTEN, REGARDING ANY MATTER PERTAINING TO THE PROPERTY OR ITS USE INCLUDING: (I) THE PHYSICAL CONDITION, ZONING, USE, VALUE, INTENDED USE, OR OTHER CONDITION OF THE PROPERTY; (II) ITS MERCHANTABILITY; (III) ITS FITNESS FOR A PARTICULAR PURPOSE; (IV) THE PHYSICAL CONDITION, ZONING, USE, VALUE, INTENDED USE, OR OTHER CONDITION OF ANY NEIGHBORING PROPERTY; OR (V) THE CLASSIFICATION OF THE PROPERTY FOR AD VALOREM PURPOSES. UPON THE CLOSING, BUYER WAIVES, AND RELEASES SELLER FROM, ALL PRIVATE RIGHTS OF ACTION UNDER FEDERAL, STATE, LOCAL, AND COMMON LAW, INCLUDING THE COMPREHENSIVE ENVIRONMENTAL RESPONSE COMPENSATION AND LIABILITY ACT, WHICH BUYER MAY HAVE AGAINST SELLER ARISING OUT OF THE PAST OR PRESENT (AS OF THE DATE HEREOF) PRESENCE OF HAZARDOUS WASTE OR SUBSTANCES ON THE PROPERTY OR ARISING OUT OF THE PHYSICAL CONDITION OF THE PROPERTY OR ANY NEIGHBORING PROPERTY. BUYER FURTHER ASSUMES THE RISK OF ALL CHANGES IN APPLICABLE LAWS AND REGULATIONS RELATING TO THE PRESENCE OF HAZARDOUS WASTES OR CONDITIONS WHICH MAY NOT BE REVEALED IN ANY ENVIRONMENTAL REPORT PROVIDED TO OR OBTAINED BY BUYER UNDER THIS AGREEMENT.

THAT BY INITIALLING BELOW, THE BUYER ACKNOWLEDGES THAT (I) THIS SECTION 6 HAS BEEN READ AND FULLY UNDERSTOOD, (II) THE BUYER HAS HAD THE CHANCE TO ASK QUESTIONS OF ITS COUNSEL ABOUT ITS MEANING AND SIGNIFICANCE, AND (III) THE BUYER HAS ACCEPTED AND AGREED TO THE TERMS SET FORTH IN THIS SECTION 6 .

      7.  Seller’s Representations, Warranties and Covenants .

     a. Seller hereby represents and warrants to Buyer, which representations and warranties shall be true and correct as of the Effective Date and as of the date of the Close of Escrow, and which shall survive the Close of Escrow for a period of six (6) months, as follows:

     i. Seller is a corporation duly organized, validly existing and in good standing under Arizona law. Seller has the legal power, right and authority to enter into this Agreement and the instruments to be executed by Seller pursuant to this Agreement and to consummate the transactions contemplated hereby. No consent of any third party is required in order for Seller to perform its obligations hereunder.

     ii. All requisite action has been taken by Seller in connection with Seller’s execution of this Agreement and the instruments to be executed by Seller pursuant to this Agreement and the consummation of the transactions contemplated hereby.

     iii. The individuals executing this Agreement and the instruments to be executed by Seller pursuant to this Agreement on behalf of such entity have the legal power, right and actual authority to bind Seller to the terms and conditions of this Agreement and such instruments.

     iv. Neither the execution and delivery of this Agreement and the documents referenced herein, nor the undertaking of the obligations set forth herein, nor the consummation of the transactions herein contemplated, nor compliance with the terms of this Agreement or the documents referenced herein conflict with or result in the material breach of any terms, conditions or provisions of, or constitute a default under, any bond, note or other evidence of indebtedness or any contract, indenture, mortgage, deed of trust, loan, partnership agreement, lease or other agreement or instrument to which Seller is a party.

     v. Except as otherwise provided in Section 32 below, all consultants, contractors and suppliers who provided materials and/or services/labor with respect to the Property or its contemplated development have been paid in full.

     vi. To Seller’s knowledge, there is not pending or overtly threatened in writing, from any federal, state, county or local authority any notice, suit, or judgment relating to any violation of any statute, ordinance, law or code with respect to the Property.

     vii. Except as may be disclosed in any environmental assessment or report provided to or obtained by Buyer, Seller has not caused or knowingly authorized the presence, placement, generation, transportation, storage, release, treatment or disposal on the Land of any hazardous substance, and has not received any notice from any governmental authority stating or indicating the existence or occurrence of any of the foregoing.

     viii. Seller has not entered into any leases or contracts which will affect or burden the Land following the Close of Escrow, and to Seller’s knowledge, there are no leases, contracts or other agreements which will affect or burden the Land following the Close of Escrow, except for matters disclosed in or pursuant to this Agreement.

     ix. To Seller’s knowledge, except as otherwise disclosed to Buyer in writin