Exhibit 1.3 FIRST AMENDMENT TO PURCHASE AND SALE AGREEMENT AND ESCROW INSTRUCTIONS This FIRST AMENDMENT TO PURCHASE AND SALE AGREEMENT AND ESCROW INSTRUCTIONS (this "AMENDMENT") is made as of January 15, 1997 by and between PETER PAULSEN, an...

Exhibit 1.3


                           FIRST AMENDMENT TO PURCHASE AND 
                        SALE AGREEMENT AND ESCROW INSTRUCTIONS

    This FIRST AMENDMENT TO PURCHASE AND SALE AGREEMENT AND ESCROW INSTRUCTIONS
(this "AMENDMENT") is made as of January 15, 1997 by and between XXXXX XXXXXXX,
an individual ("SELLER") and PACIFIC GATEWAY PROPERTIES HOTELS, INC., a
California corporation ("BUYER").

                                      RECITALS:

    A.   Seller, as seller, and Pacific Gateway Properties, Inc., a New York
corporation ("PGP"), as buyer, entered into that certain Purchase and Sale
Agreement and Escrow Instructions dated December 18, 1996 (the "AGREEMENT").

    B.   By way of Assignment dated January 15, 1997 (the "ASSIGNMENT"), PGP
assigned its interest as buyer under the Agreement to Buyer.

    C.   Seller and Buyer now desire to amend certain terms of the Agreement,
as more particularly set forth in this Amendment.  All initially capitalized
terms used but not otherwise defined in this Amendment shall have the respective
meanings assigned to such terms in the Agreement.

    NOW THEREFORE, in consideration of the foregoing and the mutual agreements
herein set forth, and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Seller and Buyer agree as follows:

                                      AGREEMENT:

    1.   PURCHASE PRICE.  The Purchase Price referred to in Section 2.1 of the
Agreement is hereby deleted and the Purchase Price of Seventeen Million Five
Hundred Thousand and 00/100 Dollars ($17,500,000.00) is substituted therefor.

    2.   CLOSING DATE.  The Closing Date refereed to in Section 6.2(a) of the
Agreement is hereby extended to January 14, 1997.  The date "January 17, 1997"
is substituted for "January 10, 1997" wherever it appears in Section 6.2 or
elsewhere in the Agreement.

    3.   ASSIGNMENT OF AGREEMENT.  Seller acknowledges that, pursuant to
Sections 11.3 and 11.19 of the Agreement, the rights of PGP under the Agreement
have been properly and validly assigned to Buyer under the Assignment.

    4.   MISCELLANEOUS.  Except as expressly modified in this Amendement, all
terms and conditions of the Agreement are unmodified and in full force and
effect.  The individuals signing below represent and warrant that they have the
requisite authority to bind those on whose behalf they are signing.  This
Amendment may be executed in one or more counterparts,



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each of which shall be deemed an original, but all of which together shall
constitute one and the same instrument.

    IN WITNESS WHEREOF, Seller and Buyer have executed this Amendment as of the
day and year first written above.

                                       "SELLER":


                                          Xxxxx Xxxxxxx
                                          ----- -------
                                       Xxxxx Xxxxxxx

                                       "BUYER":
                                       PACIFIC GATEWAY PROPERTIES
                                       HOTELS INC., A California Corporation


                                       By:       Xxxxxxx X. Xxxxxx
                                                 ------- -- ------
                                            Xxxxxxx X. Xxxxxx
                                       Its: President




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