EXHIBIT 10.11
FIRST AMENDMENT TO
PURCHASE AND SALE CONTRACT
(RE: BEST WESTERN HOTEL)
THIS FIRST AMENDMENT TO PURCHASE AND SALE CONTRACT ("Amendment") is entered
into as of May 27, 1999, by and between DBL AIRPORT VALLEY LIMITED PARTNERSHIP,
an Arizona limited partnership ("Seller") and PACIFICA HOSPITALITY GROUP, INC.,
a Nevada corporation ("Purchaser").
RECITALS:
A. Purchaser and Seller entered into that certain Purchase and Sale
Contract ("Purchase Contract") as of May 12, 1999.
B. Purchaser and Seller desire to amend the Purchase Contract to
require an additional Xxxxxxx Money Deposit, to allow Purchaser to make certain
improvements to the Property, and to allow Purchaser to extend the Closing Date
if necessary to complete such improvements, as stated herein.
AGREEMENTS:
NOW, THEREFORE, in consideration of the foregoing recitals, and for
other good and valuable consideration, the receipt, sufficiency and validity of
which are hereby acknowledged, the parties hereby agree as follows:
1. Amendment. Purchaser and Seller hereby amend the Purchase Contract as
stated herein. Terms not otherwise defined within this Amendment shall have the
meanings ascribed to them in the Purchase Contract. All terms, convenants,
conditions and provisions of the Purchase Contract are hereby reinstated,
ratified, affirmed and remain in full force and effect, as modified by this
Amendment. All references to the Purchase Contract shall, hereafter, include
the provisions of this Amendment.
2. Feasibility Period. The parties acknowledge and agree that Purchaser
has waived its right to terminate the Purchase Contract pursuant to Section 5.2
of the Purchase Contract.
3. Deposit.
a. Additional Deposit. Purchaser shall make an additional Deposit
of Fifty Thousand Dollars ($50,000.00) upon execution of this Amendment.
b. Release of Deposit. Immediately upon exercise of the extension of
the Closing Date by Purchaser, as described herein, One Hundred Thousand Dollars
($100,000.00) of the Deposit shall be released to Purchaser.
c. Default of Purchaser. If, prior to the originally scheduled
Closing Date (which date is July 12, 1999), Purchaser defaults under the
Purchase Contract by giving written notice to Seller of Purchaser's intent to
not purchase the Property and is not otherwise in default, and upon written
confirmation of Seller that Seller has no claims against Purchaser under any
other provision of this Amendment or the Purchase Contract, Escrow Agent shall
immediately release Fifty Thousand Dollars ($50,000.00) of the Deposit to
Purchaser, and the remaining portion of the Deposit to Seller as liquidated
damages pursuant to Section 12.1 of the Purchase Contract. If Closing fails to
occur on or before the originally scheduled Closing Date for any other reason
besides a Seller default or the Purchaser Default described in the prior
sentence, and Purchaser has not extended the Closing Date as provided herein,
then the entire Deposit (of $150,000.00) shall be deemed liquidated damages
scheduledtClosingoDate,1and uponPanyhbreachnofaPurchaser, the entireaamount of
the Deposit shall be deemed liquidated damages pursuant to Section 12.1 of the
Purchase Contract.
4. Extension of Closing Date. If, by the originally scheduled Closing
Date, Purchaser has not completed the Improvements and/or obtained a Best
Western Hotels PIP Inspection Report with a score of 880 or better, Purchaser
may extend the Closing Date one (1) time by thirty (30) calendar days upon: (a)
written notice to Seller five (5) days prior to the originally scheduled Closing
Date; and (b) written confirmation to Seller that Best Western Hotels has been,
and is continuing to, work with Purchaser to complete the Improvements and to
approve Purchaser as a Best Western Hotels franchisee (purchase orders showing
continuing work on the Improvements shall be adequate for such confirmation).
5. Improvements to Property.
a. Best Western Hotels Inspection. The parties acknowledge that
Purchaser desires to continue operation of the Property as a Best Western hotel
after Closing. As soon as practical, Purchaser shall request an inspection of
the Property by Best Western Hotels ("Inspection"). The Inspection shall be at
Purchaser's sole expense. Purchaser shall forward a copy of the results of the
Inspection to Seller immediately upon receipt. The parties acknowledge that
such Inspection shall occur during or upon completion of the Improvements (as
defined below).
b. Improvements. Purchaser may complete or cause to be completed,
at Purchaser's sole expense, any improvements to the Property suggested by the
Inspection in order to cause the Property to fulfill Best Western Hotels'
requirements for operation as a Best Western hotel ("Improvements"). Within
five (5) days after the date of this Amendment, Purchaser shall provide Seller
with a list of the Improvements, which Improvements must be approved by Seller,
and such approval shall not be unreasonably withheld.
c. Construction. The Improvements shall be completed in accordance
with plans and specifications submitted by Purchaser to Seller and approved by
Seller in writing. The Improvements shall be completed only pursuant to
contracts approved by Seller. Purchaser shall pay all applicable sales,
consumer, use and other similar taxes pertaining to the Improvements, and all
royalties and license fees, and shall secure and pay for all approvals,
easements, assessments, charges, permits and governmental fees, licenses and
inspections necessary for construction of the Improvements. Purchaser shall
comply with and give notices required by any and all laws, ordinances, rules,
regulations and orders of all public authorities relating to construction of the
Improvements. Purchaser shall immediately provide to Seller copies of all
notices filed by Purchaser and shall provide notice to Seller (together with
copies of all notices received by Purchaser) of any notice received by Purchaser
alleging any failure to comply with applicable law, ordinance, rule, regulation
or order of public authorities relating to construction of the Improvements.
Purchaser shall be solely responsible for providing all applicable governmental
authorities any bonds, assurance agreements or other financial assurances
required with respect to the Improvements. Purchaser shall construct the
Improvements in a manner so as to not disrupt Seller's use of the Property and
operation of the Property as a hotel during construction of the Improvements.
Purchaser shall keep the Property and surrounding areas free from accumulation
of waste materials or rubbish caused by construction of the Improvements. At
completion of the Improvements, Purchaser shall remove from and about the
Property waste materials, rubbish, tools, construction equipment, machinery and
surplus materials. Purchaser shall engage and bear all cost of the necessary
professionals to provide engineering and design work pertaining to the
Improvements. Construction of the Improvements may not be undertaken unless and
until Seller has received the consent of any lender whose loan to Seller is
secured by the Property, which consent shall be obtained by Purchaser, with
Seller's cooperation, at no cost to Seller.
d. Deposits for Improvements. If the unpaid portion of the
anticipated cost of the Improvements should at any time exceed Fifty Thousand
Dollars ($50,000.00), Purchaser shall immediately notify Seller in writing of
such excess, and shall immediately deposit into escrow the excess amount. Such
additional deposit shall be deemed a portion of the "Deposit", shall be
nonrefundable and shall be applied to the Purchase Price at Closing.
e. Completion. Prior to the Closing Date, Purchaser shall obtain
final acceptance and approval of the Improvements from any required governmental
authority, at Purchaser's sole expense, and Purchaser shall deliver to Seller of
acceptable lien waivers demonstrating that all costs and expenses incurred for
the construction of the Improvements have been fully paid and discharged by
Purchaser, or a statutory bond protecting against materialmen's and mechanics'
liens.
f. Indemnity. To the fullest extent permitted by law, Purchaser
does and shall indemnify, defend and hold harmless, and hereby releases and
discharges, Seller and its partners and agents, and their respective owners,
employees, directors, officers, agents, affiliates, successors and assigns
(collectively, the "Seller-Related Persons"), for, from and against all claims,
demands, liabilities, losses, damages, costs and expenses, including but not
limited to court costs and reasonable attorneys' fees, arising out of, resulting
from or in connection with: (a) construction of the Improvements or Purchaser's
use or occupancy of the Property; (b) any work, occurrence, conduct, act or
omission maintained, performed, permitted or suffered by Purchaser or any
representative, subcontractor or supplier of Purchaser, or any employee, agent,
invitee or licensee of any of the foregoing, on or about or pertaining to the
Property; (c) any condition of or on the Property or of or on any street, curb
or sidewalk thereon or adjacent thereto or any improvement constructed or to be
constructed thereon; (d) Purchaser's failure to perform Purchaser's obligations,
or Purchaser's breach of Purchaser's representations or warranties, relating in
any way to the Improvements or the Purchase Contract, including, without
limitation, payment of claims relating to mechanics' or materialmens' liens and
acquisition of releases to any such liens; (e) any act or negligence of
Purchaser or its representatives, subcontractors, suppliers, employees, agents,
invitees or licensees; and (f) any accident, injury or damage whatsoever caused
to any person, firm or corporation in the Property or any sidewalk, street or
land adjacent thereto arising as a result of any act or omission of Purchaser or
its representatives, subcontractors, suppliers, employees, agents, invitees or
licensees or arising from construction of the Improvements. The indemnification
obligation under this paragraph shall not be limited by a limitation on amount
or type of damages, compensation or benefits payable by or for Purchaser under
workers' or workmen's compensation acts, disability benefit acts or other
employee benefit acts.
g. Warranty. Purchaser warrants that the Improvements shall be free
from all defects of materials and workmanship. At its sole cost and expense,
Purchaser shall promptly repair or replace all defective items of the
Improvements, including, without limitation, utility connections and work
appurtenant thereto, and repair all damage resulting therefrom, but if Purchaser
fails to commence such repairs and to continue making such repairs in a diligent
manner, within fifteen (15) days after notice from Seller of the need therefor,
Seller may pursue an action for specific performance or damages or may do the
repair work itself, and Purchaser shall immediately reimburse Seller for all
costs incurred therefor together with interest thereon at eighteen percent (18%)
per annum from the date expended until reimbursed; or, at Seller's option,
Seller may offset such costs against any and all amounts due Seller by
Purchaser.
h. Remedies. Notwithstanding any provision of this Amendment or the
Purchase Contract, in the case of a default by Purchaser of any provision of
this Amendment or the Purchase Contract, Seller may pursue any and all remedy,
in law or in equity, against Purchaser. If at any time prior to Closing,
Purchaser shall be in default under any provision of this Amendment relating to
construction of the Improvements, Seller shall give written notice of such
default, and the amount necessary to correct such default, to Purchaser and to
Escrow Agent, and Escrow Agent shall immediately release a portion of the
Deposit equal to such amount to Seller for correction of the default.
i. Ownership of Improvements. While Purchaser shall be solely
responsible for payment of all costs and expenses of the Improvements and for
indemnifying Seller for all liability with respect to the Improvements, the
Improvements shall be the sole and absolute property of Seller, and Purchaser
hereby grants and conveys the Improvements to Seller and its successors and
assigns; provided, however, in the event Closing occurs under the Purchase
Contract, Seller shall convey the Improvements to Purchaser at Closing as part
of the Property. Purchaser hereby acknowledges and agrees that, if for any
reason Closing does not occur, in no case shall Purchaser have any claim against
Seller relating to reimbursement, consideration for or ownership of the
Improvements, and Seller hereby waives any and all such claims, including,
without limitation any and all claims in law, equity or under any theory of
quantum meruit.
j. No Contingency to Closing. The parties acknowledge and agree
that completion of the Improvements, approval of the Property by Best Western
Hotels or approval of Purchaser by Best Western Hotels as a Best Western Hotels
franchisee are not contingencies to Closing.
k. Liens. Mechanics' and materialmens' liens resulting from
construction of the Improvements, if any, shall be "Permitted Exceptions"
pursuant to Section 6.2 of the Purchase Contract, and Purchaser shall take title
to the Property at Closing subject to such liens.
6. Binding Effect. This Amendment shall become effective only upon full
execution of this Amendment by Purchaser and Seller. This Amendment shall inure
to the benefit of and shall be binding upon the parties hereto and their
respective successors and assigns.
7. Counterparts. This Amendment may be executed in several counterparts,
each of which counterparts shall be deemed an original instrument and all of
which together shall constitute a single Amendment.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
IN WITNESS WHEREOF, the parties hereto have executed this First Amendment
to Purchase and Sale Contract as of the date and year first above written.
SELLER:
DBL AIRPORT VALLEY LIMITED PARTNERSHIP, an Arizona limited partnership
By: XXXXXX XXXXXXX XXXXXXX REAL ESTATE ASSOCIATES III, a New York limited
partnership, Its General Partner
By: DBL PROPERTIES CORPORATION, a New York corporation, Its General Partner
By:
Printed:
Title:
PURCHASER:
PACIFICA COMPANIES, a California corporation
By:
Xxxxx Xxxxxx, President
AGREED AND ACCEPTED BY ESCROW AGENT:
FIRST AMERICAN TITLE INSURANCE COMPANY
By:
Name:
Its:
