CC Resolution 2018-032 Sunridge Properties PS & Escrow Instr AgrmtRESOLUTION NO. 2018 - 032
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF LA
QUINTA, CALIFORNIA, APPROVING A PURCHASE AND SALE
AGREEMENT AND ESCROW INSTRUCTIONS BETWEEN THE
CITY OF LA QUINTA AND SUNRIDGE PROPERTIES, INC. FOR
CERTAIN PROPERTY LOCATED AT 79523-79567 HIGHWAY
111 (APN: 600-020-053), LA QUINTA, CALIFORNIA
WHEREAS, Sunridge Properties, Inc., intends to purchase property located at
79523-79567 Highway 111 (APN: 600-020-053), La Quinta, California to construct a
four-story Residence Inn by Marriott hotel with a minimum of 108 rooms; and
WHEREAS, Sunridge Properties, Inc., has developed approximately 50 hotels
over the last 36 years and is a 6-time winner of the Partnership Circle Award,
Marriott's top award given to developers and operators for all of North America; and
WHEREAS, Sunridge Properties, Inc., intends to maintain a construction
timeline beginning January 2019 and a completion date of May 2020; and
WHEREAS, staff has negotiated a Purchase and Sale Agreement ("Agreement")
with Sunridge Properties, Inc. ""Exhibit A"" attached, pursuant to the City selling
certain real property located at 79253-79567 Highway 111 for approximately $11 per
square foot, or One Million Four Hundred and Thirty -Seven Thousand Four Hundred
and Eighty Dollars ($1,437,480) pursuant to the terms and conditions set forth in the
Agreement;
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of La Quinta,
California, as follows:
SECTION 1. That the above recitals are true and correct and incorporated herein.
SECTION 2. That the City Council of the City of La Quinta hereby finds and determines
that the sale of said property is in the best interests of the citizens of the City of La
Quinta.
SECTION 3. The Agreement, a copy of which is on file with the City Clerk, is hereby
approved. The City Council consents to the City Manager and City Legal Counsel to
make any final modifications to the Agreement that are consistent with the
substantive terms of the Agreement approved hereby, and to thereafter sign the
Agreement on behalf of the City.
SECTION 4. The City Council consents to the City Manager to (i) sign such other and
further documents, including but not limited to escrow instructions, and (ii) take such
Resolution No. 2018-032
Sunridge Sale
Adopted: June 5, 2018
Page 2 of 2
other and further actions, as may be necessary and proper to carry out the terms of
the Agreement.
PASSED, APPROVED, and ADOPTED at a regular meeting of the La Quinta City
Council held on this 5th day June, 2018, by the following vote:
AYES: Council Members Fitzpatrick, Pena, Radi, Sanchez, Mayor Evans
NOES: None
ABSENT: None
ABSTAIN: None
LINDA EVANS, Mayor
City of La Quinta, California
ATTEST:
■
J6
MONIKA RA VA, Actr g City Clerk
City of La Quinta, California
(CITY SEAL)
APPROVED AS TO FORM:
C•LJ,� r � �'L
WILLIAM H. IHRKE, City Attorney
City of La Quinta, California
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12328689.4 a06/05/18
AGREEMENT FOR PURCHASE AND SALE OF REAL PROPERTY
AND INSTRUCTIONS TO ESCROW
THIS AGREEMENT FOR PURCHASE AND SALE OF REAL PROPERTY AND
INSTRUCTIONS TO ESCROW (hereinafter, the “Agreement”) is made as of this _______day
of ___________, 2018 (the “Effective Date”), by and between the CITY OF LA QUINTA, a
California municipal corporation and charter city (“Seller” or “City”) and SUNRIDGE
PROPERTIES, INC., an Arizona corporation (“Buyer”).
R E C I T A L S:
A. Seller is the owner of that certain real property consisting of approximately 2.5-
3.0 acres located on a portion of 79523-79567 Highway 111 in the City of La Quinta, County of
Riverside, State of California (APN 600-020-053), and more particularly described in the Legal
Description and depicted in the final site plan in Exhibit “A” attached hereto (the approximately
2.5-3.0 acres referred to as the “Real Property”).
B. Seller wishes to sell the Real Property to Buyer and Buyer wishes to buy the Real
Property from Seller pursuant to the terms and conditions of this Agreement.
C. Buyer intends to construct or cause the construction of a four-story Residence Inn
by Marriott hotel with a minimum of 108 rooms on the Real Property.
D. During construction, Buyer intends to temporarily utilize one (1) acre of City
owned property depicted in Exhibit “B” attached hereto (“Construction Staging Property”) for
construction staging. As detailed in Section 11 herein, Buyer intends to fence the Construction
Staging Property and agrees to provide liability insurance for the Construction Staging Property
expressly benefitting the City. Further, Buyer agrees to vacate the Construction Staging Property
with thirty (30) days upon notice by the City.
E. Buyer represents and warrants that it has or will be able to obtain any and all
licensing rights for a Residence Inn by Marriott and intends to maintain a timeline of
construction beginning January 2019 and a completion date of May 2020. These dates may be
extended by any of the following: (1) entitlement, planning, or permitting delays caused by a
third party, (2) extensions for any entitlement, planning, or permitting required by the City in
accordance with the City’s Municipal Code, or (3) mutual written agreement between Seller and
Buyer.
F. Buyer and Seller executed that certain “Letter of Intent for the Purchase and Sale
of Real Property Located At 79523-79567 Highway 111 in the City of La Quinta, California”
dated April 18, 2018 (the “LOI”). This Agreement supersedes the LOI, and any terms and
conditions from the LOI that are to remain operative are expressly set forth in this Agreement.
G. Nothing herein shall be construed by Buyer, or any other party, to constitute
Seller’s intent or commitment to (a) approve any future development or use on the Property, or
(b) approve any permit or entitlement that may be required under the City’s Municipal Code for
the development and use of the Real Property. However, Seller acknowledges and agrees that
EXHIBIT A
RESOLUTION NO. 2018-032
Buyer's obligation to close escrow is expressly contingent on obtaining all necessary City
permits and entitlements for Buyer to construct and operate its hotel project on the Property.
Seller hereby acknowledges and agrees that if Seller does not approve all necessary permits and
entitlements for Buyer to construct and operate its hotel project on the Property, Buyer is
relieved of its obligation to close escrow and all earnest money deposits provided for herein shall
be refunded to Buyer.
NOW, THEREFORE, based on the Recitals above, which are a substantive part of this
Agreement and incorporated hereunder, and in consideration of the respective agreements
hereinafter set forth, the parties hereto agree as follows:
TERMS AND CONDITIONS
1. Purchase and Sale of Pro e . Buyer hereby agrees to purchase from Seller, and
Seller hereby agrees to sell to Buyer, all of Seller's right, title and interest in the Real Property,
together with all improvements thereon, and all rights, privileges, and easements appurtenant to
the Real Property, including without limitation, all of Seller's interests in the Real Property. The
Real Property, improvements, and the appurtenant rights shall be referred to herein as the
"Property."
2. Purchase Price.
2.1 Amount of Purchase Price. The purchase price for the Property (the
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Hundred and Eighty Dollars ($1,437,480).
2.2 Payment of Purchase Price. The Purchase Price shall be paid as follows:
(a) If not already on deposit with the Escrow Holder pursuant to the
LOI, Buyer shall, within three (3) business days of the Opening of Escrow (as defined in
Section 4.1 below), deposit with Escrow Holder (as defined in Section 4.1 below) by wire
transfer of immediately available funds as a good faith deposit ("Initial Deposit") the amount of
Ten Thousand Dollars ($10,000), which funds are applicable to the Purchase Price but and are
refundable to Buyer. A portion of the Initial Deposit in the amount of One Hundred Dollars
($100.00) (the "Independent Consideration") shall be deposited with Escrow Holder and shall be
non-refundable to Buyer under any circumstances as independent consideration for the rights
extended to Buyer under this Agreement. The Independent Consideration shall be released to
Seller immediately following Buyer's deposit of the Independent Consideration into Escrow (as
defined in Section 4.1 below). The Independent Consideration shall be applicable towards the
Purchase Price.
(b) On or prior to the expiration of the Contingency Period (as defined
in Section 3.1 below), and upon Buyer's election to move forward by providing an approval
notice to Seller ("Approval Notice"), Buyer shall deposit an additional Fifty Thousand Dollars
($50,000) ("Second Deposit"), by wire transfer of immediately available funds which shall be
applicable to the Purchase Price at the Close of Escrow.
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123286894 a06/05/18
(c) All deposit money, comprising the Initial Deposit and the Second
Deposit, in the aggregate amount of Sixty Thousand Dollars ($60,000) (collectively, the
"Deposit"), shall be applied toward the Purchase Price of the Property at the Close of Escrow (as
defined in Section 4.2 below). The Deposit shall be invested by Escrow Holder, and all interest
earned on the Deposit shall be paid to Buyer on demand or, at Buyer's election, credited to the
Purchase Price upon the Closing Date (as defined in Section 4.2, below). The Deposit shall
become non-refundable upon Buyer providing the Approval Notice to Seller, and shall constitute
liquidated damages to Seller in the event of Buyer's default.
(d) Buyer will pay the remaining unpaid balance of the Purchase Price
of One Million Three Hundred Seventy Seven Thousand Four Hundred Eighty Dollars
($1,377,480) (the "Initial Unpaid Principal Balance Amount"), as may be adjusted pursuant to
Section 2.2(e) below (referred to as the "Unpaid Principal -Balance") on the business day
preceding the Closing Date.
(e) For purposes of calculating the Unpaid Principal Balance, square
footage attributed to any linear public right of way, such as a sidewalk or public street, may be
excluded from the Net Square Footage (defined below) for which the Property is purchased. If
Buyer seeks an adjustment in the Unpaid Principal Balance pursuant to this Section 2.2(e), Buyer
shall, at its own cost and expense, obtain an ALTA survey that meets the minimum requirements
in Section 6.2(d) of this Agreement. An adjustment may be made whereby the Initial Unpaid
Principal Balance Amount may be reduced by Eleven Dollars ($11.00) for each square foot in a
linear public right of way identified on the Real Property. The "Net Square Footage" shall be the
square footage of the Real Property less any square footage attributable to a linear right of way
on the Real Property. The allowance for any adjustment to the Unpaid Principal Balance
pursuant to this Section shall be strictly construed, and general use easements, easements in
gross, and other similar public or private rights on, under, above, or through the Real Property
shall not be considered linear public rights of way.
2.3 As used in this Agreement, "immediately available funds," shall mean a
wire transfer of funds issued by the offices of a financial institution located in the State of
California, or cashier's check payable to the City of La Quinta, California.
3. Contingency Period: Buyer's Investigations; Exclusive Location Rights.
3.1 Contingency Period. Buyer's Contingency period with respect to the
Property shall commence on the Effective Date and shall expire sixty (60) calendar days after the
Effective Date (the "Contingency Period").
(a) Following the Effective Date, Seller shall provide Buyer with any
Phase I Environmental Site Assessment for the Property previously prepared and in the
possession of Seller within ten (10) days. During the Contingency Period, Buyer may (i)
undertake a Phase I and/or Phase II Environmental Site Assessment, at Buyer's cost and expense,
to determine if there are any Hazardous Materials (as defined in Section .8. I (c) below) present on
the Property, and (ii) make such other investigations as it deems necessary to determine whether
the Property is suitable for Buyer's intended use; provided, however, Buyer must receive Seller's
prior written consent for any invasive or destructive testing performed on the Property by Buyer,
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and Buyer comply with Section 3.1(c) of this Agreement. Seller shall be entitled to receive
copies of all reports, tests, and studies of the Property prepared by, on behalf of or for, Buyer
(collectively, the "Due Diligence Documents") within five (5) business days of Buyer's receipt
of same.
(b) In the event that Hazardous Materials are present on the Property
or the Property is not suitable for Buyer's intended use (as determined by Buyer in its reasonable
discretion), Buyer shall have the right to terminate this Agreement by delivery of written notice
thereof to Seller prior to the expiration of the Contingency Period ("Disapproval Notice"). Upon
Buyer's termination of this Agreement, Escrow Holder shall return the Initial Deposit to Buyer,
and Buyer shall provide to Seller all Due Diligence Documents.
(c) Subject to this Section, Seller hereby grants Buyer and its agents,
employees, contractors and other representatives a limited license during the Contingency Period
to enter upon the Property to make such inspections, tests, and other examinations of the
Property as Buyer deems necessary in order for Buyer to determine whether the Property will be
suitable for Buyer's intended use; provided, however, that Buyer shall provide Seller at least
twenty-four (24) hours' notice prior to Buyer, its agents, employees, contractors and/or other
representatives entering upon the Property, and representatives of Seller shall have the right to
accompany Buyer during any such entry. Buyer shall indemnify and hold Seller and the
Property free from any and all liability, claims, damages and expenses (including but not limited
to attorneys' fees) caused by or resulting from the exercise of said license. Prior to entering
Property, Buyer shall provide Seller with a Certificate of Insurance in the amounts approved by
Seller's Risk Manger or her designee. Buyer's indemnity shall survive the Close of Escrow or
earlier termination of this Agreement.
3.2 Contingency Materials. Seller has heretofore provided Buyer with
documents relating to the condition of the Property. Within five (5) business days following the
Effective Date, Seller shall provide to Buyer copies of all surveys, tract maps, Phase l reports,
and other information which Seller may have in its possession or under its control but which was
not previously made available to Buyer. During Escrow, Buyer may, at its sole discretion and
cost, order a survey, including an ALTA survey that meets the minimum provisions in Section
6.2(d) of this Agreement, an environmental analysis, and such other studies and reports as may
be required by Buyer.
3.3 Exclusive Location Rights. From and after the Effective Date through
either the Close of Escrow or cancellation of the Escrow after the Contingency Period,
whichever occurs first, Buyer shall not negotiate with any other person or entity, public or
private, for the acquisition or development, or both, of any real property for another hotel with
the brand and name "Residence Inn by Marriott" within ten (10) miles of the Property.
4. Escrow Opening and Additional Funds and Documents Required.
4.1 Opening of Escrow. If not already opened pursuant to the LOI, Buyer
shall, within three (3) business days of the Effective Date, open an escrow (the "Escrow") with
Four Seasons Escrow, Inc. at its office located at 51351 Avenida Bermudas, La Quinta,
California, or such other escrow company as mutually agreed upon by Buyer and Seller (the
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"Escrow Holder"), by causing an executed copy of this Agreement to be deposited with Escrow
Holder. Escrow shall be deemed open on the date that a fully executed copy of this Agreement
is delivered to Escrow Holder (the "Opening of Escrow"). Escrow Holder shall immediately
distribute to Buyer and Seller fully executed copies of this Agreement and provide each of the
parties with written confirmation of the date of the Opening of Escrow. Four Seasons Escrow,
Inc., or other title company mutually agreeable to Buyer and Seller, shall also provide title
insurance services related to this Agreement.
4.2 Closing Date. The sale of the Property shall close on or before thirty (30)
days after the expiration of the Contingency Period and satisfaction or written waiver of each of
the conditions precedent to Buyer's obligations contained in Section 6.1 below and the
conditions precedent to Seller's obligations contained in Section 6.2 below, subject to any
extension exercised pursuant to Section 4.3 and Section 4.4 below of this Agreement (the
"Closing Date") or by written agreement by the Parties extending the Closing Date. Subject to
the foregqing, in no event, however, shall the Closing Date occur later than one hundred -five
(105) calendar days following the beginning of the Contingency Period without the City
Manager's or his designee's written consent. The term the " Closing" or "Close of Escrow" is
used herein to mean the time the Grant Deed (as defined in Section 4.6 below) is filed of record
in the Office of the County Recorder of Orange County, California.
4.3 Seller Extension. In the event that all documents and releases, as required
by this Agreement or any amendment to Agreement, have not been submitted to Escrow Holder
prior to the Closing Date, Seller may extend the Closing Date specified in Section 4.7 above, but
not for more than a period of thirty (30) additional calendar days.
4.4 Buyer Extension. In the event the City has not "Approved" all permits
and entitlements necessary for Buyer to construct and operate its hotel project on the Property,
Buyer may extend the Closing Date specified in Section 4.2 above, but not for more than a
period of ninety (90) additional calendar days.
For purposes of this Section, "Approved" shall mean that (1) the City has taken
final action to approve the Project entitlements and (2) all applicable and legally valid periods for
the filing of an administrative appeal, judicial challenge, referendum petition or request for
reconsideration ("Entitlement Challenge") against the entitlements (or any CEQA review
conducted in connection therewith) have expired without the filing of an Entitlement Challenge,
or if an Entitlement Challenge is filed or otherwise arises, that such Entitlement Challenge is
resolved on terms satisfactory to the Parties. Nothing in this Section or elsewhere in this
Agreement shall be construed as abrogating or otherwise affecting any and all discretionary
review authority that any official, board, commission, or council of the City has under law.
4.5 If, after ninety (90) additional calendar days, all necessary permits and
entitlements have not been Approved, Buyer shall have the option to notify Seller that Buyer is
relieving itself of its obligation to close escrow. Alternatively, the Parties shall have the option
to agree in writing to extend the Closing Date by a mutually agreed upon number of days. in the
event Buyer exercises its option to notify Seller that Buyer is relieving itself of its obligation to
close escrow, all earnest money deposits paid by Buyer to Seller to date, as provided for herein,
shall be refunded to Buyer. Escrow Instructions. This Agreement, together with any standard
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instructions of Escrow Holder, shall constitute the joint escrow instructions of Buyer and Seller
to Escrow Holder as well as an agreement between Buyer and Seller. In the event of any conflict
between the provisions of this Agreement and Escrow Holder's standard instructions, the
provisions of this Agreement shall prevail.
4.6 Deliveries from Buyer. Buyer agrees that on or before 1:00 p.m. on the
business day preceding the Closing Date, Buyer will deposit with Escrow Holder all additional
funds and/or documents (executed and acknowledged, if appropriate) which are necessary to
comply with the terms of this Agreement, including without limitation, the following:
(a) The balance remaining for the Purchase Price;
(b) A Preliminary Change of Ownership Report completed in the
manner required in Riverside County;
(c) Any deed of trust required by any lender as a security interest for
the acquisition ;
(d) A duly executed agreement, or memorandum thereof, for the
development of the proposed Residence Inn by Marriott hotel project, such as a statutory
development agreement, in recordable form; and
(e) All other sums and documents (in forms reasonably approved by
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Agreement, including the Escrow fees and Buyer's portion of prorations, if any.
4.7 Deliveries from Seller. Seller agrees that on or before 1:00 p.m. on the
business day preceding the Closing Date, Seller will deposit with Escrow Holder such funds and
other items and instruments (executed and acknowledged, if appropriate) as may be necessary in
order for the Escrow Holder to comply with this Agreement, including without limitation, the
following:
(a) The grant deed conveying fee simple title of the Property to Buyer
substantially in the form of Exhibit "C" attached hereto (the "Grant Deed");
(b) Any necessary reconveyances to remove the lien(s) of any deed of
trust encumbering Property,
(c) A duly executed agreement, or memorandum thereof, for the
development of the proposed Residence Inn by Marriott hotel project, such as a statutory
development agreement, in recordable form; and
(d) All other sums and documents (in forms reasonably approved by
Buyer) required by Escrow Holder to carry out and close the Escrow pursuant to the terms of this
Agreement, including the Escrow fees and Buyer's portion of prorations, if any.
Escrow Holder will cause the Grant Deed to be recorded when it can: (i) issue the Title Policy
in the form described in Section 5.2 below, (ii) holds for the account of Seller the items
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described above to be delivered to Seller through the Escrow, less costs, expenses and
disbursements chargeable to Seller pursuant to the terms hereof, and (iii) holds for the account of
Buyer the items described above to be delivered to Buyer through the Escrow, less costs,
expenses and disbursements chargeable to Buyer pursuant to the terms hereof.
4.8 Contracts, Leases and Rental Agreements Affecting the Property. Seller
hereby affirms and warrants to Buyer that there are no leases, rental agreements, contracts or
other agreements encumbering the Property as of the date Buyer executes this Agreement, except
those listed on the Preliminary Title Report (defined in Section 5.1 below), which the Parties
hereby acknowledge and agree they have received a copy of and have had a full and complete
opportunity to review.
4.9 Distribution of Documents. Following Close of Escrow, Escrow Holder
shall distribute the documents as follows:
(a) To Buyer:
(i) One certified conformed copy of the Grant Deed, with the
original of the Grant Deed to be mailed to Buyer following recordation thereof,
(ii) One certified copy, conformed if recorded, of any other
document, including a statutory development agreement or memorandum thereof pursuant to
Sections 4.5(d) and 4.6(c) of this Agreement, delivered to Escrow Holder by Buyer or Seller
pursuant to the terms hereof,
(iii) The Title Policy (defined in Section 5 2, below).
(b) To Seller:
(i) One certified copy, conformed if recorded, of any
document, including a statutory development agreement or memorandum thereof pursuant to
Sections 4.5(d) and 4.6(c) of this Agreement, delivered to Escrow Holder by Buyer or Seller
pursuant to the terms hereof.
4.10 Distribution of Funds to Seller. At the Close of Escrow, Escrow Holder
shall deliver to Seller or, at Seller's election, wire transfer into Seller's account, the Purchase
Price of One Million Four Hundred and Thirty Seven Thousand Four Hundred and Eighty
Dollars ($1,437,480), subject to adjustment pursuant to Section 2.2(e) of this Agreement.
Title Review and Title Policy.
5.1 Approval of Title. Seller has caused to be prepared and delivered to Buyer
a preliminary title report from First American Title Company, 3400 Central Avenue, Suite 100,
Riverside, CA, Order No. 0625-5690514, dated as of April 17, 2018 at 7:30a.m., describing the
state of title of the Property, together with copies of all exceptions specified therein and with all
easements plotted (the "Preliminary Title Report"). Buyer hereby acknowledges receipt of the
Preliminary Title Report. Buyer shall notify Seller in writing of any objections Buyer may have
to title exceptions contained in the Preliminary Title Report within twenty (20) business days
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after the Effective Date ("Buyer's Objection Notice"). Seller shall have a period of five (5)
business days after receipt of Buyer's Objection Notice in which to notify Buyer in writing of
Seller's election to either (i) agree to remove the objectionable items prior to the Close of
Escrow, or (ii) decline to remove any such title exceptions ("Seller's Notice"). Seller's failure to
provide Seller's Notice shall be deemed an election by Seller to decline to remove such title
exceptions. If Seller notifies Buyer of its election not to remove the objectionable items, or is
deemed to have elected not to remove the objectionable items, then, subject to the immediately
preceding proviso, Buyer shall have the right, by written notice delivered to Seller within five (5)
business days after (a) Buyer's receipt of Seller's Notice, (b) the date Seller is deemed to have
elected not to remove the objectionable items, to terminate this Agreement, in which case Buyer
and Seller shall have no further obligation hereunder. Buyer's failure to give Seller notice of
termination shall be deemed Buyer's election to accept the Property subject to the objectionable
items.
Upon the issuance of any amendment or supplement to the Preliminary Title Report
which adds additional exceptions, the foregoing right of review and approval shall also apply to
said Preliminary Title Report amendment or supplement and the time for Closing shall be
deemed extended by the amount of time necessary to allow such review and approval in the time
and manner as set forth above.
5.2 Title Policy to be Issued to Buyer. At the Close of Escrow, Seller shall
convey to Buyer fee simple title to the Property by a Grant Deed. The Property shall be subject
to (i) real property taxes not yet due as of the Close of Escrow, (ii) all applicable zoning, building
and development regulations of any municipality, county, state or federal jurisdiction affecting
the Property, (iii) such exceptions as Buyer shall approve or be deemed to have approved
pursuant to Paragraph 5.1 above. Escrow Holder shall issue a CLTA Standard Coverage owner's
policy of title insurance in the amount of the Purchase Price (the "Title Policy"). At Buyer's
election, Buyer may increase the coverage to an Extended Coverage Owner's Policy of Title
Insurance. The Title Policy shall insure fee simple title to the Property in Buyer and shall
contain such special endorsements as Buyer may reasonably require (the "Endorsements").
Buyer shall bear the expense of the Title Policy and all Endorsements. Any Endorsements
required by Buyer shall not be a condition precedent to the Close of Escrow.
6. Conditions Precedent to Close Of Escrow.
6.1 Conditions to Buyer's Obligations. The obligations of Buyer to purchase
the Property and proceed to close the Escrow to take all right, title, and interest to the Property
under this Agreement shall be subject to either the satisfaction, or Buyer's written waiver, in
whole or in part, of each of the following conditions precedent prior to the Closing Date:
(a) Escrow Holder shall issue the Title Policy, as required by
Section 5.2 of this Agreement, insuring title to the Property vested in Buyer or other vestee
designated by Buyer for vesting purposes only.
(b) Escrow Holder holds and will deliver to Buyer the instruments and
funds, if any, accruing to Buyer pursuant to this Agreement.
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(c) All representations and warranties specified in Section 8 are true
and correct.
(d) Delivery to Escrow Holder of all reconveyances, if any.
(e) Approval by Buyer of the physical and environmental condition of
the Property.
(f) Approval by Buyer of the condition of title to the Property, subject
to permitted title exceptions acknowledged and approved by Buyer and Seller pursuant to this
Agreement.
(g) Acknowledgement by Buyer that all permits and entitlements
necessary to construct its hotel project on the Property have been obtained by the City.
(h) Acknowledgement by Buyer that there are no current or pending
litigation matters against or threatened against the Property, to Seller's knowledge.
(i) This Agreement shall not have been terminated by Buyer as a
result of any damage, destruction or condemnation of the Property as described in Paragraph
11.4 hereof.
0) Seller shall have delivered to Escrow Holder the items required
under this Agreement and Seller shall not otherwise be in default of this Agreement.
6.2 Conditions to Seller's Obligations. The obligations of Seller to sell the
Property and proceed to close the Escrow to convey all right, title, and interest to the Property to
Buyer under this Agreement shall be subject to the satisfaction, or Seller's written waiver, in
whole or in part, by Seller of each of the following conditions precedent:
(a) Escrow Holder holds and will deliver to Seller the instruments and
funds accruing to Seller pursuant to this Agreement.
(b) Receipt of, or process to receive, any and all land use entitlements
and permits required for the proposed Residence Inn by Marriott hotel project.
(c) Approval of all permits and entitlements necessary for Buyer to
construct and operate its hotel project on the Property.
(d) Negotiation and execution, in a form for recording in the Riverside
County Recorder's Office ("Recorder's Office"), of an agreement for the development of the
proposed Residence Inn by Marriott hotel project, such as a statutory development agreement
enacted by ordinance pursuant to California Government Code section 65864 et seq. and the La
Quinta Municipal Code. To the extent permitted by law and Recorder's Office, a memorandum
may be recorded in a form approved by Seller in lieu of the recording of such agreement.
(e) If Buyer seeks a calculation to adjust the Unpaid Principal Balance
pursuant to Section 2.2(e) above, Seller shall be in receipt of and approve an ALTA survey that
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clearly depicts any linear public rights of way on the Real Property, the square footage of those
linear public rights of way, and the accurate acreage and total square footage of the Real
Property.
(f) The approval by the City Council of the City of La Quinta of the
sale of the Property, an agreement for the development of the proposed Residence inn by
Marriott hotel project, such as a statutory development agreement described in Section 6.2(c),
and any material amendments to this Agreement.
(g) Buyer has not, as of the Close of Escrow, negotiated with any other
person or entity, public or private, for the acquisition or development, or both, of any real
property for another hotel with the brand and name "Residence Inn by Marriott" within ten (10)
miles of the Property.
(h) Buyer shall not be in default of this Agreement.
7. Costs and Prorations.
7.1 Pavment of Costs. Seller shall pay the premium charges for a standard
Title Policy and Seller shall pay the premium charges for any extended coverage or endorsement.
Buyer shall pay the cost and expense for all surveys (including any ALTA survey that may be
obtained pursuant to this Agreement), environmental analysis, and such other studies and reports
as may be required by Buyer. All other costs such as recording fees, documentary transfer taxes,
if any, not otherwise specificaiiy aiioca[ea by this Agreement shali be appurtiunea between uie
parties in a manner consistent with the custom and usage of Escrow Holder.
7.2 Personal Property. Seller shall remove all personal property from the
Property prior to the Close of Escrow. All personal property remaining with the Property after
the Close of Escrow shall become the property of Buyer and Buyer may sell or dispose of said
property without liability or recourse to Seller or any person or entity claiming under Seller, and
Buyer shall have no duty to account for such property. Personal property shall be defined as
those items not attached to the realty.
7.3 [Zeal Estate Taxes and Special Assessments. General real estate taxes and
assessments payable for the tax year prior to the tax year in which the Closing occurs and all
prior years, if any, shall be paid by Seller. All non -delinquent taxes and assessments applicable
to the Property, including, without limitation, all property taxes and assessments shall be
prorated as of the Close of Escrow on the basis of the actual number of days of the month that
have elapsed as of the Close of Escrow and based upon a three hundred sixty-five (365) day year.
Should the Property be part of a larger tax parcel ("Assessment Parcel") which as of the Closing
remains unsegregated on the County Tax Assessor's Roll for the coming fiscal year, Escrow
Holder shall charge Buyer and credit Seller for taxes and assessments allocated to the Property
on an acreage basis compared to the acreage for the entire Assessment Parcel, which acreage
figures for allocation purposes shall be fairly and equitably determined and supplied to Escrow
Holder by Buyer and Seller. Buyer and Seller shall cooperate in good faith to cause the Property
to be separately assessed and segregated in Buyer's name on the current tax roll.
2774/015610-0157 -1 0-
12328689.4 a06/05/18
Subject to the provisions of the immediately preceding paragraph, if any of the aforesaid
prorations cannot be calculated accurately on the Closing Date, then they shall be calculated as
soon after the Closing Date as feasible. Either party owing the other party a sum of money based
on such subsequent proration(s) shall promptly pay said sum to the other party, together with
interest thereon at the rate of two percent (2%) over the average "prime rate" (as announced from
time to time in the Wall Street Journal) per annum from the Closing Date to the date of payment
if payment is not made within twenty (20) days after delivery of a bill therefor. This Section 7.3
shall survive the Close of Escrow.
7.4 Closing Statement. Escrow Holder shall furnish Buyer and Seller with a
preliminary escrow closing statement, which shall include their respective shares of costs, at
least two (2) business days prior to the Closing Date.
8. Representations and Warranties.
8.1 Seller Representations and Warranties. Seller hereby makes the following
representations and warranties to Buyer, each of which (i) is material and relied upon by Buyer
in making its determination to enter into this Agreement, and (ii) is true in all respects as of the
date hereof and shall be true in all respects on the date of Closing:
(a) To the best of Seller's actual knowledge there are no existing,
proposed, or contemplated eminent domain proceedings that would materially and adversely
affect the Property.
(b) Seller has no actual knowledge of pending or threatened litigation
or filing of a petition under any Federal Bankruptcy Law or any federal or state insolvency laws
or laws for composition of indebtedness or for the reorganization of debtors, which does or will
affect the Property and there are no actions or proceedings pending or, to the best of Seller's
knowledge, threatened against Seller before any court or administrative agency in any way
connected with the Property.
(c) Except as expressly stated below in this Section 8.1(c), Seller has
no actual knowledge of any Hazardous Material (as defined in this paragraph) (i) located on or
under the Real Property in violation of any applicable law or regulation, (ii) that have been
released, stored, treated, generated or disposed of on, under or from the Real Property, or (iii)
that have been transported from the Real Property. Seller has no actual knowledge of any
environmental condition on or under the Real Property constituting a violation of, or requiring
investigation or remediation under, any Hazardous Materials laws. Seller is also unaware of (i)
any lawsuit, arbitration or other legal proceeding or governmental investigation relating to the
Real Property brought against Seller; and (ii) any settlement reached with any person, entity or
governmental authority, alleging the presence, release or threatened release of any Hazardous
Materials on, under or from the Real Property. As used in this Agreement, "Hazardous
Materials" shall mean (i) any hazardous substance, hazardous waste, or toxic substance as
defined in any federal, state or local statue, ordinance, rule, regulation or order applicable to the
Property ("Hazardous Materials Laws"), including without limitation the Comprehensive
Environmental Response, Compensation and Liability Act, the Resource Conservation and
Recovery Act, the Hazardous Materials Transportation Act, the Federal Water Pollution Control
2774/015610-0157
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Act, the Clean Air Act, the Toxic Substances Control Act, the Refuse Act, the Carpenter -Presley -
Tanner Hazardous Substance Account Act, the Hazardous Waste Control Law or in regulations
adopted and publications promulgated pursuant to such laws, (ii) any substance defined as
"hazardous waste" in Section 25117 of the California Health & Safety Code or as a "hazardous
substance" in Section 25281 of the California Health & Safety Code or as a "waste" in
Section 13050 of the California Water Code, or in regulations adopted and publications
promulgated pursuant to such laws, and (iii) asbestos or asbestos -containing materials, radon gas,
petroleum and petroleum fractions or derivatives, whether or not defined as hazardous waste or
substance in any Hazardous Materials Laws. Seller hereby agrees to provide Buyer with any
Phase I Environmental Site Assessment Report that was previously prepared for the Property and
is in the possession of Seller within thirty (30) days of the Effective Date.
(d) Seller consists of the CITY OF LA QUINTA, a California
municipal corporation and charter city. This Agreement and all documents executed by Seller
which are to be delivered to Buyer at the Closing are and at the time of Closing will be duly
authorized, executed and delivered by Seller, are and at the time of Closing will be legal, valid
and binding obligations of Seller enforceable against Seller in accordance with their respective
terms, are and at the time of Closing will be sufficient to convey title (if they purport to do so),
and do not and at the time of Closing will not violate any provision of any agreement or judicial
order to which Seller or the Property is subject.
(e) At the time of Closing, except as may be described in the
Preliminary Title Report, there will be no outstanding written or oral contracts made by Seller for
any improvements to the Property which have not been fully paid for and Seller shall cause to be
discharged all mechanics' and materialmen's liens arising from any labor or materials furnished
to the Property prior to the time of Closing.
(f) Seller has not granted any option or right of first refusal or first
opportunity to any party to acquire any interest in the Property; provided, however, that Seller
shall have the right to reserve a reversionary interest in the Property if Buyer fails to develop the
Property pursuant to an agreement for the development of the proposed hotel project, such as a
statutory development agreement, as described in Section 6.2(c) of this Agreement. Any such
reversionary right shall be according to terms and conditions mutually agreed upon by Buyer and
Seller and memorialized in the agreement for the development of the proposed hotel project,
such as a statutory development agreement.
(g) Seller warrants that there are no outstanding loans or liens
encumbering the Property except those of record.
8.2 Buyer Representations and Warranties. Buyer hereby makes the following
representations and warranties to Seller, each of which (i) is material and relied upon by Seller in
making its determination to enter into this Agreement, and (ii) is true in all respects as of the date
hereof and shall be true in all respects on the date of Closing:
(a) Buyer consists of SUNRIDGE PROPERTIES, INC., a California
corporation. This Agreement, the Deed of Trust and all other documents executed by Buyer
which are to be delivered to Seller at the Closing are and at the time of Closing will be duly
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12328689,4 a06/05/ 18 -12-
authorized, executed and delivered by Buyer, are and at the time of Closing will be legal, valid
and binding obligations of Buyer enforceable against Buyer in accordance with their respective
terms, and do not and at the time of Closing will not violate any provision of any agreement or
judicial order to which Buyer is subject.
(b) Buyer has no actual knowledge of pending or threatened litigation
or filing of a petition under any Federal Bankruptcy Law or any federal or state insolvency laws
or laws for composition of indebtedness or for the reorganization of debtors, which does or will
affect the Property or Buyer's authority and right to purchase the Property; and there are no
actions or proceedings pending or, to the best of Buyer's knowledge, threatened against Buyer
before any court or administrative agency in any way connected with the legality, validity or
enforceability of this Agreement or Buyer's purchase of the Property.
(c) Buyer acknowledges that it has received copies of the Preliminary
Title Report and understands the terms and provisions in said document.
(d) Buyer has obtained, or by the Close of Escrow will have obtained,
any and all licenses and permissions necessary and proper for the use of the name "Residence
Inn by Marriott" for the hotel project at the Property.
(e) Buyer has not, as of the Close of Escrow, negotiated with any other
person or entity, public or private, for the acquisition or development, or both, of any real
property for another hotel with the brand and name "Residence Inn by Marriott" within ten (10)
miles of the Property.
8.3 Property Sold "As Is"; Release. Buyer acknowledges that, as of the
expiration of the Contingency Period, it will have had ample opportunity to inspect or examine
the Property and become fully familiar with the physical condition and state of repair of the
Property, and the operation, income and expenses thereon and all other matters affecting or
relating to the transactions contemplated by this Agreement. Subject to the provisions of this
Agreement, including without limitation, Section 8.1, Buyer shall accept the Property "AS IS,
WHERE IS, WITH ALL FAULTS" and in its present condition, subject to reasonable use, wear,
tear and natural deterioration between the Effective Date and the Close of Escrow, without any
reduction in the Purchase Price for any change in such condition by reason thereof subsequent to
the Effective Date. Except for the representations and warranties expressly provided in
Section 8.1 of this Agreement, Buyer agrees: (i) that it is purchasing the Property on an "AS IS,
WHERE IS, WITH ALL FAULTS" basis and based on its own investigation of the Property, and
(ii) that neither Seller nor any of the other Released Parties (as defined below) have made any
warranty, representation or guarantee, expressed, implied or statutory, written or oral, including,
without limitation, as to any implied warranty of merchantability or fitness for any use or
purpose or of reasonable workmanship, concerning the Property, pertaining to the Property's
compliance with any laws, ordinances, rules or regulations, federal, state or local, as to any
government limitation or restriction, or absence thereof, pertaining to the Property, or as to the
presence or absence of any latent defect, surface or subsurface soil condition, any other matter
pertaining to the physical condition (title, mapping, grading, construction, or otherwise) of the
Property, or as to any past, present or future permitted uses, development rights, entitlements,
zoning, or any other matter pertaining to the use or development of the Property. Except for the
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12328689,4 a06/05/ 18 -13 -
representations and warranties expressly provided in Section 8.1 of this Agreement, all of the
Released Parties' statements, whenever made, are made only as an accommodation to Buyer and
are not intended to be relied or acted upon in any manner by Buyer. All documents, records.
agreements, writings, statistical and financial information and all other information (collectively,
"Documents") which have been given to Buyer by any of the Released Parties, have been
delivered as an accommodation to Buyer and, unless prepared by Seller, are without any
representation or warranty as to the sufficiency, accuracy, completeness, validity, truthfulness,
enforceability, or assignability of any of the Documents.
Upon Closing, Buyer fully, unconditionally, and irrevocably releases Seller and any
affiliates of Seller, any elected or appointed official, representative, officer, director, trustee,
member, partner, employee, representative or agent thereof, or any other entity or individual
affiliated or related in any way to any of the foregoing (collectively, the "Released Parties") from
any and all claims that Buyer may now have or hereafter acquire against any of the Released
Parties for any costs, fees, loss, liability, damage, expenses, demand, fine, penalty, action or
cause of action arising from or related to the Property, its design, development, entitlements or
any conditions existing or events occurring on, in or about the Property before or after the
Closing, including without limitation any construction defects, errors, omissions or other
conditions, latent or otherwise, including, without limitation, environmental matters, affecting
the Property, or any portion thereof. This release includes claims of which Buyer is presently
unaware or which Buyer does not presently suspect to exist which, if known by Buyer, would
materially affect Buyer's release of the Released Parties. Nothing herein shall constitute a
release of liabilitv for a breach of Seller's representations expressly set forth in this Agreement
(subject to Section 1 1.12) or for fraud, intentional misrepresentation or intentional concealment
of a material fact by Seller. In connection with this release, Buyer specifically waives the
provision of California Civil Code Section 1542, which provides as follows:
A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS
WHICH THE CREDITOR DOES NOT KNOW OR EXPECT
TO EXIST IN HIS OR HER FAVOR AT THE TIME OF
EXECUTING THE RELEASE, WHICH IF KNOWN TO
HIM OR HER MUST HAVE MATERIALLY AFFECTED
HIS OR HER SETTLEMENT WITH THE DEBTOR.
Buyer's Initials Seller's Initials
This release by Buyer shall constitute a complete defense to any claim, cause of
action, defense, contract, liability, indebtedness or obligation released pursuant to this
release. Nothing in this release shall be construed as (or shall be admissible in any legal
action or proceeding as) an admission by Seller or any other released party that any
defense, indebtedness, obligation, liability, claim or cause of action exists which is within
the scope of those hereby released. This Section 8.3.shall survive the Close of Escrow.
9. Liquidated Damages. IF, ON OR BEFORE THE CLOSING DATE, BUYER IS
IN DEFAULT OF ANY OF ITS OBLIGATIONS HEREUNDER, AND THE CLOSING FAILS
TO OCCUR BY REASON OF BUYER'S DEFAULT, THEN SELLER, AS ITS SOLE
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12328689.4 a06/05/I8 -14-
REMEDY (EXCEPT AS SET FORTH BELOW), SHALL BE ENTITLED TO TERMINATE
THIS AGREEMENT AND RECEIVE AND RETAIN THE DEPOSIT AS LIQUIDATED
DAMAGES, AND AFTER SELLER RECEIVES THE DEPOSIT NEITHER PARTY TO THIS
AGREEMENT SHALL HAVE ANY FURTHER RIGHTS OR OBLIGATIONS HEREUNDER
OTHER THAN ANY ARISING UNDER ANY SECTION HEREIN WHICH EXPRESSLY
PROVIDES THAT IT SURVIVES THE TERMINATION OF THIS AGREEMENT. BUYER
RECOGNIZES AND ACKNOWLEDGES THAT THE PROPERTY WILL HAVE BEEN
REMOVED FROM THE MARKET FOR A SUBSTANTIAL PERIOD OF TIME BY REASON
OF THIS AGREEMENT, THAT SELLER IS RELYING ON BUYER'S AGREEMENT TO
PURCHASE THE PROPERTY, AND THAT SELLER WOULD OTHERWISE SUFFER
SUBSTANTIAL DETRIMENT IN THE EVENT BUYER FAILS TO PERFORM BUYER'S
OBLIGATIONS UNDER THIS AGREEMENT. BUYER SPECIFICALLY AGREES THAT
SELLER SHALL BE ENTITLED TO COMPENSATION FOR THE DETRIMENT THAT
WOULD BE CAUSED TO SELLER BY REASON OF BUYER'S DEFAULT HEREUNDER.
HOWEVER, BOTH PARTIES AGREE THAT IT WOULD BE EXTREMELY DIFFICULT
AND IMPRACTICAL TO ASCERTAIN THE EXTENT OF THE DETRIMENT AND
DAMAGES CAUSED BY BUYER'S DEFAULT. TO AVOID SUCH DIFFICULTIES, THE
PARTIES AGREE THAT IF BUYER DEFAULTS IN ITS OBLIGATION TO CLOSE ON
THE PROPERTY AS REQUIRED UNDER THIS AGREEMENT AND, BY REASON
THEREOF, CLOSING DOES NOT OCCUR, AS ITS SOLE AND EXCLUSIVE REMEDY,
SELLER SHALL BE ENTITLED TO THE DEPOSIT AS LIQUIDATED DAMAGES;
PROVIDED, HOWEVER, THAT THIS PROVISION WILL NOT WAIVE, LIMIT OR
AFFECT ANY OF THE FOLLOWING: (i) SELLER'S RIGHT TO RECEIVE
REIMBURSEMENT FOR ATTORNEYS' FEES, (ii) SELLER'S RIGHTS AND REMEDIES
ARISING UNDER OR WITH RESPECT TO BUYER'S RELEASE AND/OR INDEMNITY
OBLIGATIONS UNDER THIS AGREEMENT, AND (iii) IN THE EVENT THAT
FOLLOWING ANY TERMINATION OF THIS AGREEMENT, ANY DAMAGES SELLER
MAY INCUR IF BUYER WRONGFULLY ASSERTS ANY CLAIMS OR RIGHT TO THE
PROPERTY THAT WOULD OTHERWISE DELAY OR PREVENT SELLER FROM
HAVING CLEAR, INDEFEASIBLE AND MARKETABLE TITLE TO THE PROPERTY.
BOTH PARTIES AGREE THAT SUCH AMOUNT STATED AS LIQUIDATED DAMAGES
IS A REASONABLE ESTIMATE OF SELLER'S DAMAGES IN THE EVENT OF BUYER'S
DEFAULT IN ITS OBLIGATION TO PURCHASE THE PROPERTY AS PROVIDED
HEREIN AND SUBJECT TO THE LIMITATIONS SET FORTH ABOVE, SUCH AMOUNT
SHALL BE IN LIEU OF ANY OTHER MONETARY OR OTHER RELIEF TO WHICH
SELLER MAY OTHERWISE BE ENTITLED BY VIRTUE OF THIS AGREEMENT OR BY
OPERATION OF LAW. THE PAYMENT OF SUCH AMOUNT AS LIQUIDATED
DAMAGES IS NOT INTENDED AS A FORFEITURE OR PENALTY WITHIN THE
MEANING OF CALIFORNIA CIVIL CODE SECTION 3275 OR 3369, BUT IS INTENDED
TO CONSTITUTE LIQUIDATED DAMAGES TO SELLER PURSUANT TO CALIFORNIA
CIVIL CODE SECTIONS 1671, 1676 AND 1677. SELLER HEREBY WAIVES CIVIL CODE
SECTION 3389.
Buyer's Initials Seller's Initials
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12328689.4 a06/05/ 18 -1 5-
10. Possession. Possession of the Property shall be delivered to Buyer as of the Close
of Escrow.
It. Construction Staging Property. Following the Closing Date, Buyer shall be
permitted to utilize the Construction Staging Property for the sole purpose of construction
staging and access, defined herein as access to and activities involving the storage, staging, and
maintenance of construction materials, machinery and equipment associated with Buyer's
construction of the hotel project on the Property. Buyer shall erect a temporary construction
fence around any portion of the Construction Staging Property that will be utilized for
construction staging, or the entirety of the Construction Staging Property, prior to utilizing it for
construction staging. Buyer shall obtain liability insurance for the Construction Staging Property
to the satisfaction of the City, which shall specifically provide that it is intended for the benefit of
the City. Buyer shall be entitled to utilize the Construction Staging Property for construction
staging, subject to the provisions in this Section 11, on or after the Closing Date and until a
Certificate of Occupancy is issued for the Property, upon which date Buyer shall remove all
construction staging materials and shall return the Construction Staging Property to its condition
prior to the Closing Date, to the satisfaction of the City. Notwithstanding the foregoing, if at any
time Seller provides Buyer with notice to vacate the Construction Staging Property, Buyer shall
vacate the Construction Staging Property within thirty (30) days of receipt of such notice.
12. Miscellaneous.
12.1 Attorneys' Fees. In any action or proceeding between the parties hereto
seeking interpretation or enforcement of any of the terms and provisions of this Agreement or in
connection with the Property, the prevailing party in such action or proceeding shall be entitled
to have and to recover from the other party its reasonable attorneys' fees and other reasonable
expenses in connection with such action or proceeding in addition to its recoverable court costs.
12.2 Administration of Agreement. Seller shall maintain authority of this
Agreement and the authority to implement this Agreement through its City Manager (or his or
her duly authorized representative). The City Manager shall have the authority to make
approvals, issue interpretations, execute documents, waive provisions, and/or enter into certain
amendments or implementing documents in furtherance of this Agreement on behalf of Seller so
long as such actions do not result in any increased costs or a reduction in sales proceeds to Seller
or increase the risk of liability to Seller. Such approvals, interpretations, waivers, implementing
documents, and/or amendments may include extensions of time to perform.
12.3 Actual Knowledge. The term "actual knowledge" with regard to Seller
shall mean the actual knowledge of Seller's employee Gilbert Villalpando, without any duty to
investigate. The term "actual knowledge" with regard to Buyer shall mean the actual knowledge
of Buyer's employee Paul Welker, without any duty to investigate.
12.4 Damage. Destruction or Condemnation. If prior to the Close of Escrow,
there occurs any destruction of or damage or loss to the Property or Improvements or any portion
thereof from any cause whatsoever, including but not limited to any fire, flood, accident or other
casualty which results in a loss, or any condemnation proceedings are commenced or threatened,
Buyer shall have the right by giving ten (10) calendar days written notice to Seller to (i)
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12328689.4 ❑06/05/18 -1 6-
terminate this Agreement, in which case neither party shall have any further rights or obligations
hereunder, and all funds and any interest accrued and documents deposited in Escrow shall be
returned to the party depositing the same, or (ii) accept the Property in its then condition and
proceed with the Close of Escrow in accordance with this Agreement, in which case Seller shall
assign Buyer the right to any and all insurance proceeds or condemnation awards recoverable as
a result of such event, and (iii) there shall be a credit against the Purchase Price of an amount
equal to the deductible under Seller's insurance coverage for such event and any uninsured or
underinsured portion of the repair cost stated in the estimate of loss. In the absence of a written
notice to Seller provided in this paragraph, and assuming that Buyer has been informed of the
loss or condemnation action, Escrow shall proceed in accordance with the provisions of this
Agreement.
12.5 interpretation: Governing Law. This Agreement shall be construed
according to its fair meaning and as if prepared by both parties hereto. This Agreement shall be
construed in accordance with the laws of the State of California in effect at the time of the
execution of this Agreement, without regard to conflict of law principles. Titles and captions are
for convenience only and shall not constitute a portion of this Agreement. As used in this
Agreement, masculine, feminine or neuter gender and the singular or plural number shall each be
deemed to include the others wherever and whenever the context so dictates.
12.6 No Waiver. No delay or omission by either party hereto in exercising any
right or power accruing upon the compliance or failure of performance by the other party hereto
under the provisions of this Agreement shall impair any such right or power or be construed to
be a waiver thereof. A waiver by either party hereto of a breach of any of the covenants,
conditions or agreements hereof to be performed by the other party shall not be construed as a
waiver of any succeeding breach of the same or other covenants, agreements, restrictions or
conditions hereof.
12.7 Modifications. Any alteration, change or modification of or to this
Agreement, in order to become effective, shall be made by written instrument or endorsement
thereon and in each such instance executed on behalf of each party hereto.
12.8 Severabilily. If any term, provision, condition or covenant of this
Agreement or the application thereof to any party or circumstances shall, to any extent, be held
invalid or unenforceable, the remainder of this instrument, or the application of such term,
provision, condition or covenant to persons or circumstances other than those as to whom or
which it is held invalid or unenforceable, shall not be affected thereby, and each term and
provision of this Agreement shall be valid and enforceable to the fullest extent permitted by law.
12.9 Merger of Prior Agreements and Understandings. This Agreement and
other documents incorporated herein by reference contain the entire understanding between the
parties relating to the transaction contemplated hereby and all prior or contemporaneous
agreements, understandings, representations and statements, oral or written, are merged herein
and shall be of no further force or effect. The LOI is expressly of no further force and effect.
12.10 No Survival. The covenants, representations, and agreements contained
herein shall not survive the Closing, unless otherwise provided herein. A party shall only be
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12328689.4 a06/05/ 18 -1 7-
liable to the other party for a breach of a representation or warranty hereunder or in any of the
documents executed by liable party at the Closing with respect to which a legal action is actually
filed by the other party against the liable party on or before the date which is six (6) months
following the Closing. Seller and Buyer each intends to waive any statute of limitations that
would be contrary to the time frame for filing an action for breach of the other party's
representations and warranties as set forth above. Notwithstanding the foregoing, however, if the
Closing occurs, each party hereby expressly waives, relinquishes and releases any right or
remedy available to it at law, in equity, under this Agreement or otherwise to make a claim
against the other party for damages that the first party may incur, or to rescind this Agreement, as
the result of any second party representations being untrue, inaccurate, incomplete, or incorrect if
the first party knew that such representation or warranty was untrue, inaccurate, incomplete, or
incorrect prior to the time of the Closing.
12.1 1 Time is of the Essence. Time is hereby expressly made of the essence of
this Agreement.
12.12 Execution in Counterpart. This Agreement may be executed in several
counterparts, and all so executed shall constitute one agreement binding on all parties hereto,
notwithstanding that all parties are not signatories to the original or the same counterpart.
12.13 Notices. Any notice which either party may desire to give to the other
party or to the Escrow Holder must be in writing and may be given by personal delivery or by
mailing the same by registered or certified mail, return receipt requested, to the party to whom
the notice is directed at the address of such party hereinafter set forth, or such other address and
to such other persons as the parties may hereafter designate:
To Seller: City of La Quinta
78-495 Calle Tampico
La Quinta, CA 92253
Attn: City Manager
With Copy to: Rutan & Tucker, LLP
611 Anton Blvd., Fourteenth Floor
Costa Mesa, CA 92626-1931
Attn: William H. Ihrke, Esq.
To Buyer: Sunridge Properties, Inc.
7255 E. Hampton Avenue, Suite 122
Mesa, AZ 85209
Attn: Paul Welker
With Copy to: Brent D. Ellsworth, P.C.
4445 E. Holmes Avenue, Suite 106
Mesa, AZ 95206
12.14 Assignment. Seller expressly agrees and acknowledges that Buyer may
assign or transfer any right, interest, or obligation under this Agreement to a nominee that is an
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12328689,4 a06/05/ 18 - 1 8-
entity owned or controlled by Buyer ("Nominee"). With the exception of a Nominee, Buyer
shall not voluntarily or by operation of law assign or transfer any right, interest or obligation
under this Agreement without Seller's express prior written consent, which consent may be given
or withheld by Seller in its sole and absolute discretion. Subject to the foregoing, and without
limiting the restriction on assignment set forth above, each and all of the covenants and
conditions of this Agreement shall inure to the benefit of and shall be binding upon the
respective heirs, executors, administrators, successors and assigns of Buyer and Seller. As used
in this Section, the term "successors" shall refer to the successors to all or substantially all of the
assets of a party and to a party's successors by merger or consolidation.
12.15 Exhibits. Exhibits "A" through "C" are attached hereto and incorporated
herein by this reference.
12.16 Survival of Article 11. This Article 11 shall survive the termination of this
Agreement or the Close of Escrow.
2774/015610-0157
12328689 4 a06/05/ 18 -19-
IN WITNESS WHEREOF, the parties hereto have executed this Agreement of Purchase
and Sale of Real Property and Instructions to Escrow as of the date set forth above.
SELLER:
CITY OR LA
APPROVED AS TO FORM: Frank pevac City Manager
By: l�L J��' L' Ell i Attest, 1
WILLIAM H. IHRKE, City Attorney MONIKA RADEVA, Acting City Clerk
City of La Quinta, California City of La Quinta, California
APPROVED AS TO FORM:
Counsel
Sunridge Properties, Inc.
BUYER:
SUNRIDGE PROPERTIES, INC.
sy:
Name JL W',•/
2774101 56 t 0-0157
12328689.4 nOW07/18 -20-
EXIMIT "A"
-Legal Descrintion of Real Pronertv
[See following page]
wsf CONE IRM LEGAL DE S CCRIPTION I5 FOR AP 2.5-3 ACRE
r T ENTIRE PA.RCE] w
i23286894 ao61mna Exhibit "A"
r71•ec Nmbh . 062-3"0914
Pqe Nmbw: 6
LEGAL DESCRIPTION
Reel property in the City of Riverside, County of Riverside, St.Ae of Calrfomie, described as follows:
IN THE CITY OF LA IJUINTA, Ct WNTY C CF RIVERSIDE, STATE C CF CALIFORNIA. THAT Pr IRT ON OF THE
WEST HALF r sF THE EAST HALF AND THE EAST HALF ()F T14E WEa RALF OF THE NO NtTHWE5T
QUARTER OF THE SOUTH EAST C�UARTER tW 5ECTION 29, TfJWNSHIP 5 9.)UTH, RANGE 7 EAST, SAN
BHUORDIM t BASE AND MERIDIAN, MORE PARTICULARLY DESCRIBED AS F- rLLCiWS:
Cr rMMENCING AT THE EAST QUARTER CORNER C rF SAM 5ECTIC IN 29, THENCE SOUTH S9939'16" WEST
ALONG THE NO rRTH LINE [.IF SAID S,,.rUTHEAST (ZUARTER, A D15TANCE C If 1,656.S7 FEET TO r THE
W)RTHEAST CORNER OF SAID WEST HALF t IF THE FAST HALF OF THE NORTHWEST QUARTER C IF THE
St rUTHEAST QUARTER OF SECTION 29, THENCE SOUTH 00008'10" EAST ALONG THE EAST LINE C If
SAID WEST HALF of THE EAST HALF Of THE NO rRTHWEST QUARTER r IF THE St IU THEAST QUARTER
r IF SECTION 29, A DISTANCE :IF 60.93 FEET To THE SOUTH RIGHT-( IF -WAY LINE OF HIGHWAY 111 AS
GRANTED TO THE CITY CrF LA QUINTA PER INSTRUMENT NO. 2007-0076257 REOaDED FEBRUARY 1,
2007 AND RE -RECORDED FEBRUARY 14, 2007 AS INSTRUMENT Nrr. 2007-0103255, 0.IMCIAL
RECORDS, AND THE TRUE POINT OF BEGINNING: THENCE CONTINUING Sr KITH 00°08'10" EAST
ALONG SAID EAST LINE A DISTANCE OF 626.13 FEET TO THE BEGINNING s IF A NC rN-TANGENT CURVE,
CONCAVE NORTHERLY. HAVING A RADIUS C IF 300.00 FEET. A RADIAL LIME T(C SAID POINT T BEARS
SOUTH 01"53'43" WEST: THENCE LEAVING SAID EAST LINE AND WESTERLY AU CNG THE ARC OF SAID
CURVE, THROUGH A CENTRAL ANGLE nF 160D9'07'. AN ARC DISTANCE OF 84.57 FEET Tt I THE
BEGINNING OF A REVERSE CURVE, CONCAVE SOUTHERLY, HAVING A RADIUS OF 300.00 FEET, A
RADIAL LINE TO C SAID Ps TINT SEARS NORTH 1800Z'50" EAST: THENCE WESTERLY ALONG THE ARC (IF
SAID CURVE THROUGH A CENTRAL ANGLE CrF 18002'50", AN ARC DISTANCE (IF 94.50 FEET; THENCE
NORTH 90°00'00' WEST A DISTANCE (IF 264.78 FEET TO THE BEGINNING OF A TANGENT CURVE-
0 INCAVE SC rUTHEASTERLY, HAVING A RADIUS OF 200.00 FEET; THENCE SOUTH WESTERLY ALONG
THE ARC OF SAID CURVE. THRc )UGH A CENTRAL ANGLE c 1F 90009`34", AN ARC DISTANCE trF 314.72
FEET; THENCE NC 1N-TANGENTTC 1 SAID CURVE SOUTH 8905026- WEST A DISTANCE {if= 21.18 FEET To1
THE WEST LOVE (IF SAID EAST HALF CIF THE WEST HALF C IF THE NORTHWEST QUARTER OF THE
SOUTHEAST [QUARTER CIF SECTION 29; THENCE NC )RTH 000DV34" WEST ALONG SAID WEST LINE, A
DISTANCE CrF 797.02 FEET 7r1 SAID SsXfTH RIGHT{CF- WAY LINE CIF HIGH WAY 111: THENCE NORTH
89058'06" EAST ALONG SAID 51 3UTH RIGHT-( IF -WAY LINE A D157ANCE OF 662.65 FEET TO THE TRUE
POINT OF BEGINNING.
SAID LAND IS ALSO SHOWN AS PARCEL 1 OF LOT LINEAD]U5T14ENT No. 2010-S08 AS DISCLOSED BY
GRANT DEED RECORDED DECEMBER 2, 2010, AS INSTRUMENT NO. 2010-0575516, CrF OFFICIAL
REC{ JRDS.
APN: 600-020-053-6
2774/015610-0157
12328689.4 a06/05/18 '='
EXHIBIT "B"
Depiction of Construction Staizin2 Propertv
[See following page]
2774/015610-0157
12328689.4a06/05/18 Exhibit «C"
SCHEMATIC DESIGN
ARCHITECTURAL RESIDENCE INN BY
S[TE PLAN MARRIOTT, LA QUINTA , CA SUNRIDGE PROPERTIES
i;! ,II
9=0
n l.
sf.�illllillllhl
EXHIBIT "C"
Grant Deed
[See following document]
1774/015610-0157
12328689.4 a06/05/ 18
Recording Requested by and when
Recorded Mail this Deed and Mail
Tax Statement to:
CITY OF LA QUINTA
78-495 Calle Tampico
La Quinta, CA 92253
Exempt from Fee —Public Agency
(Government Code Section 6103)
SPACE ABOVE FOR RECORDER'S USE ONLY
GRANT DEED
FOR A VALUABLE CONSIDERATION, the receipt and adequacy of which is hereby
acknowledged, CITY OF LA QUINTA, a municipal corporation and charter city ("Grantor"
herein), and its successors and assigns hereby GRANTS AND CONVEYS to SUNRIDGE
PROPERTIES, INC. ("Grantee" herein), all of Grantor's right, title and interest in that certain
real property, "AS -IS, WHERE -IS, AND WITH ALL ITS FAULTS," and subject to all
covenants, conditions, restrictions, reservations of rights, rights of way, encumbrances and
easements of record, located on approximately 2.5-3 acres located on a portion of 79523-79567
Highway I I I in the City of La Quinta, County of Riverside, California, as particularly described
in the legal description attached hereto as Exhibit "I" and incorporated herein by this reference
("Property").
APPROVED AS TO FORM:
City Attorney
City of La Quinta
APPROVED AS TO FORM:
Counsel
Sunridge Properties, Inc.
GRANTOR:
CITY OF LA QUINTA
By:_
Attest:
Frank Spevacek, City Manager
City Clerk
GRANTEE:
SUNRIDGE PROPERTIES, INC.
By:
Name:
1774/015610-0157
12328689.4 a06/05/ 18 Exhibit "F"
A Notary Public or other officer completing this certificate verifies only the identity of the
individual who signed the document to which this certificate is attached, and not the truthfulness,
accuracy, or validity of that document.
State of California
County of
.Am
before me,
(insert name and title ofthe officer)
Notary Public, personally appeared ,
who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are
subscribed to the within instrument and acknowledged to me that he/she/they executed the same
in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument
the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that
the foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Signature
1774/015610-0157
12328689.4 a00/05/18 C-2
(Seal)