AHA-2024-005RESOLUTION NO. AHA- 2 0 2 4- 0 0 5
A RESOLUTION OF THE GOVERNING BOARD OF THE ANAHEIM
HOUSING AUTHORITY APPROVING THE ACQUISITION OF THE
RAINBOW INN MOTEL LOCATED AT 831 S. BEACH BOULEVARD IN
THE AMOUNT OF $6,930,000, SOURCED IN WHOLE OR IN PART,
FROM CITY OF ANAHEIM NEIGHBORHOOD RESERVE FUNDS AND
LOW MODERATE INCOME HOUSING ASSET FUNDS; APPROVING AN
AGREEMENT FOR SALE OF PROPERTY AND JOINT ESCROW
INSTRUCTIONS BY AND BETWEEN THE ANAHEIM HOUSING
AUTHORITY AND DHANUBA HOSPITALITY, INC., A CALIFORNIA
CORPORATION, SUBSTANTIALLY IN THE FORM SUBMITTED
HEREWITH FOR THE PURCHASE OF THE RAINBOW INN MOTEL IN
THE AMOUNT OF $6,930,000; AUTHORIZE THE EXECUTIVE
DIRECTOR OF THE HOUSING AUTHORITY, OR HER DESIGNEE, TO
EXECUTE AND ADMINISTER THE AGREEMENT ON BEHALF OF THE
HOUSING AUTHORITY
WHEREAS, the Anaheim Housing Authority ("Authority") is a California housing
authority duly organized and existing under the California Housing Authorities Law, Part 2 of
Division 24, Section 34200, et seq., of the Health and Safety Code ("HAL"), and has been
authorized to transact business and exercise the power of a California housing authority pursuant
to action of the City Council ("City Council") of the City of Anaheim; and
WHEREAS, the City of Anaheim ("City") is a California municipal corporation and
charter city; and
WHEREAS, on May 21, 2024, the Authority approved a Resolution declaring that the
acquisition of the real property located at 831 South Beach Boulevard is a necessity of public
interest and convenience for public purpose; and
WHEREAS, in 2018, the City adopted the Beach Boulevard Specific Plan to facilitate the
revitalization of Beach Boulevard outlining various goals and objectives including the need to
reduce the oversupply of motel rooms by approximately 50% and to increase the availability of
housing to meet regional housing needs while also supporting the additional commercial uses
envisioned along the corridor; and
WHEREAS, public interest and necessity require an affordable housing project located
along 821-837 S. Beach Boulevard consisting of the construction of approximately 120 affordable
rental units and 15 for -sale townhomes ("Project"); and
WHEREAS, the proposed Project is planned or located in the manner that will be most
compatible with the greatest public good and the least private injury; and
WHEREAS, the City Neighborhood Reserve Funds includes funding for the creation
of affordable housing projects; and
WHEREAS, among the eligible activities in the City Neighborhood Reserve Fund
is property acquisition for the creation of affordable housing opportunities; and
WHEREAS, Authority additionally maintains a Low and Moderate Income Housing Asset
Fund (the "Housing Asset Fund") pursuant to Health and Safety Code Section 34176 and 34176.1,
which Housing Asset Funds are available to Authority to assist in the development and operation
of rental housing in City that is affordable to persons and families of low, very low and extremely
low income; and
WHEREAS, Authority intends to acquire the Rainbow Inn Motel, sourced in whole or in
part, with City Neighborhood Reserve Funds and Low Moderate Income Housing Asset funds in
the amount of $6,930,000 for the purposes of creating a mixed -income development inclusive of
varying affordable housing opportunities; and
WHEREAS, Dhanuba Hospitality, Inc., a California corporation (Seller) has agreed to sell
the 42-unit motel located at 831 S. Beach Boulevard, also known as the Rainbow Inn Motel to the
Anaheim Housing Authority (Authority) for $6,930,000. The attached Agreement for Sale of
Property and Joint Escrow Instructions (Agreement) between the Authority and the Seller reflects
the total purchase price. The Motel will provide affordable housing opportunities in West Anaheim
and will assist with the City's efforts in the revitalization of Beach Boulevard; and
WHEREAS, it is the intention of the Authority and City to acquire the Rainbow Inn Motel
property for the purposes of creating a mixed -income development inclusive of varying affordable
housing opportunities; and
WHEREAS, upon acquiring the Site the Authority will relocate eligible occupants of the
Rainbow Inn Motel; the acquisition of the Site and the implementation of the Project shall comply
with all applicable requirements of the federal Uniform Relocation Assistance and Real Property
Acquisition Policies Act of 1970 (URA), as amended, the implementing regulations of Handbook
1378 of the Department of Housing and Urban Development (HUD), the California Relocation
Assistance Law, Government Code Section 7260, et seq., and the Relocation Assistance and Real
Property Acquisition Guidelines adopted by the Department of Housing and Community
Development and set forth at Title 25, California Code of Regulations Section 6000, et seq.
(Guidelines) (collectively, the "Relocation Laws"); and
WHEREAS, by the Authority's commitment of monies sourced in whole or in part from
City Neighborhood Reserve Funds and Housing Asset Funds, neither Authority (or Successor
Agency or City) intends in any manner to waive any constitutional and/or legal rights under the
Dissolution Act or any other applicable laws; therefore, Authority (and Successor Agency and
City) expressly and intentionally reserve all rights under any and all applicable laws to challenge
the validity of any or all provisions of the Dissolution Act in any legal manner or proceeding,
including challenging determinations made by the Oversight Board and/or California Department
of Finance, without prejudice to City or Successor Agency or Authority; and
WHEREAS, the Project is vital to and in the best interest of City and the health, safety
and welfare of its residents, and is in accordance with the public purposes of applicable state and
local laws and requirements; and
WHEREAS, the Authority has prepared such notices, plans and reports as may be required
prior to consideration of this matter and has made available for public inspection all such matters
prior to the public consideration of this matter; and
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WHEREAS, the Authority and City held a public meeting to consider the Project and the
transaction contemplated therein in accordance with the Housing Authorities Law, the California
Community Redevelopment Law to the extent applicable, Health and Safety Code Section 33000,
et seq., and the Dissolution Act; and
WHEREAS, the Authority has duly considered all terms and conditions of the proposed
Agreement, including all attachments thereto, and believes that the Project is in the best interests
of City and the health, safety, and welfare of its residents, and in accord with the public purposes
and provisions of applicable state and local laws and requirements.
NOW, THEREFORE, BE IT RESOLVED BY THE ANAHEIM HOUSING
AUTHORITY:
Section 1. The Authority Board finds and determines that the foregoing recitals are true
and correct and are a substantive part of this Resolution.
Section 2. The Authority Board hereby finds and determines, based on all
documentation, testimony and other evidence in the record before it, that (a) the proposed
acquisition of the Site will assist in the elimination of blight by allowing a parcel (the Site)
constrained with infrastructure deficiencies to be converted to a mixed -income development
inclusive of varying affordable housing opportunities.
Section 3. The Authority Board hereby approves the acquisition of the Rainbow Inn
Motel, sourced in whole or in part, with City Neighborhood Reserve Funds and Low Moderate
Income Housing Asset funds and approves an Agreement for Sale of Property and Joint Escrow
Instructions by and between the Anaheim Housing Authority and Dhanuba Hospitality, Inc.
substantially in the form submitted herewith for the purchase of the Rainbow Inn Motel located at
831 S. Beach Boulevard in the amount of $6,930,000.
The Authority Executive Director, or her designee, is authorized to execute and administer
the Agreement for Sale of Property and Joint Escrow Instructions and the Cooperation Agreement
on behalf of the Housing Authority.
Section 4. In addition to the authorization of Section 3 above, the Authority
Executive Director is hereby authorized, on behalf of the Authority, to sign all other documents
necessary or appropriate to carry out and implement the Agreement for Sale of Property and Joint
Escrow Instructions. In addition, the Executive Director is authorized to execute and administer
on behalf of the Authority the Cooperation Agreement substantially in the form submitted
herewith.
Section 5. As the "lead agency" under the California Environmental Quality Act (Public
Resources Code Section 21000, et seq.; herein referred to as "CEQA"), the Governing Board of
the Housing Authority reviewed the environmental impacts of the proposed property acquisition
pursuant to the California Environmental Quality Act (Public Resources Code §§ 21000, et seq.
"CEQA") and the regulations promulgated thereunder (14 Cal. Code of Regs. §§ 15000, et seq.,
the "CEQA Guidelines"). CEQA Guidelines §§ 15060(c)(2), 15061(b)(3), and 15378 exempt
activities that will not result in a direct or reasonably foreseeable indirect physical change in the
environment, activities where there is possibility that it may have a significant effect on the
environment, and activities that do not constitute a "project" as defined, respectively. This
Resolution is for general policies and procedure -making. Any subsequent development will be
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evaluated separately under the CEQA Guidelines. Accordingly, this Resolution is exempt from
further review.
Section 6. Notice of CEQA Determination. The Authority Secretary, or designee, is
directed to file a Notice of Exemption in accordance with Pub. Res. Code §21152; 14 CCR § §
15062, and any other applicable law.
Section 7. If any section, paragraph or provision of this Resolution shall be held to be
invalid or unenforceable for any reason, the invalidity or unenforceability of such section,
paragraph or provision shall not affect any remaining sections, paragraphs or provisions of this
Resolution.
Section 8. This Resolution shall be effective immediately upon adoption.
Section 9. The Authority Secretary shall certify to the adoption of this Resolution.
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THE FOREGOING RESOLUTION IS PASSED, APPROVED AND ADOPTED BY
THE GOVERNING BOARD OF THE ANAHEIM HOUSING AUTHORITY THIS
EIGHTEENTH (18th) DAY OF JUNE, 2024, BY THE FOLLOWING ROLL CALL VOTE:
AYES: Chairperson Aitken and Authority Members Kurtz,
Leon, Rubalcava, Faessel and Meeks
NOES: None
ABSTAIN: Authority Member Diaz
ABSENT: None
ANAHEI HOUSING A HORITY
By:
CHAe5TLRSON
A
THO IT SECRETARY
ATTACHMENT TO RESOLUTION
Page 1 of 1
ASSESSOR PARCEL NO.: 079-164-13
SELLER: DHANUBA HOSPITALITY, INC.
BUYER: ANAHEIM HOUSING AUTHORITY
ANAHEIM HOUSING AUTHORITY
AGREEMENT FOR SALE OF PROPERTY
AND JOINT ESCROW INSTRUCTIONS
THIS AGREEMENT FOR SALE OF PROPERTY AND JOINT ESCROW INSTRUCTIONS (the
"Agreement") is dated for identification only as of May 20, 2024, by and between Dhanuba
Hospitality, Inc., a California corporation (hereinafter called "Seller"), and Anaheim Housing
Authority, a public body corporate and politic (hereinafter called "Buyer"), for acquisition by Buyer
of certain property as hereinafter set forth.
IT IS HEREBY MUTUALLY AGREED BETWEEN THE PARTIES AS FOLLOWS:
1. AGREEMENT TO SELL AND PURCHASE. Seller agrees to sell, convey, transfer and
deliver to Buyer, and Buyer agrees to purchase from Seller, upon the terms and for the
consideration set forth in this Agreement, all of the following property (hereinafter collectively
called "Property"):
A. Real Property. That certain real property together with Seller's right, title and
interest, if any, in and to all improvements, mineral interests, easements, rights of way, licenses,
interests, rights and appurtenances pertaining to the real property, situated in the City of Anaheim,
County of Orange, State of California, and legally described in Exhibit A attached hereto, and
commonly known as 821-837 S. Beach Blvd., Anaheim, California (collectively, the "Real
Property"). Improvements to the Real Property include a 42-room motel with rooms rented to
motel guests (the "Motel Guests").
B. Personal Pronerty. All equipment, facilities, machinery, tools, appliances, fixtures,
furnishings, furniture, paintings, sculptures, art, inventories, supplies, computer equipment and
systems, telephone equipment and systems, satellite dishes and related equipment and systems,
security equipment and systems, fire prevention equipment and systems, and all other items of
tangible personal property owned by Seller and located on or about the Real Property or used in
conjunction therewith, free and clear of any and all liens, liabilities, encumbrances, exceptions
and claims, other than the Assumed Contracts (collectively, the "Personal Property").
C. Intangible Property. All intangible personal property not otherwise described in this
Paragraph 1 and owned by Seller and relating to the Real Property or the business of owning,
operating, maintaining and/or managing the Real Property, including, without limitation: (i) all
warranties, guarantees and bonds from third parties; (ii) all good will relating to the business of
owning, operating, maintaining and managing the Real Property; (iii) all trade names, trademarks,
service marks and logos used in conjunction with the ownership, operation and management of
the Real Property, whether or not registered (collectively, the "Intangible Property").
D. Assumed Contracts. All of the Contracts (as defined in Paragraph 5.A) that Buyer
has expressly agreed to assume in writing upon the Closing pursuant to a written notice by Buyer
delivered to Seller prior to the expiration of the Due Diligence Period (collectively, the "Assumed
Contracts"). In the event Buyer fails to deliver to Seller Buyer's written election to assume one or
4871-3953-9903 v6 Page 1
more of the Contracts pursuant to this Paragraph 1.D, such failure shall be deemed to constitute
Buyer's election not to assume any of the Contracts and upon such failure, Seller shall terminate
all Contracts Buyer has not elected to assume effective no later than the Closing Date.
E. Permits and Entitlements. All of Seller's right, title and interest in, to and under the
following in Seller's possession or control: (i) all permits, licenses, certificates of occupancy,
approvals, authorizations and orders obtained from any governmental authority and relating to
the Real Property or the business of owning, maintaining and/or managing the Real Property; (ii)
all preliminary, proposed and final drawings, renderings, blueprints, plans and specifications
(including "as -built" plans and specifications), and tenant improvement plans and specifications
for the Improvements (including "as -built" tenant improvement plans and specifications; and (III)
all maps and surveys for any portion of the Real Property; (iv) all items constituting the Seller's
Deliveries, and all changes, additions, substitutions and replacements for any of the foregoing,
free and clear of any and all liens and claims (collectively the "Permits and Entitlements").
2. PURCHASE PRICE. The total purchase price for the Real Property, payable in cash,
certified or cashier's check payable to the Escrow Agent, or by electronic transfer of federal funds
through escrow, shall be the sum of SIX MILLION NINE -HUNDRED AND THIRTY THOUSAND
DOLLARS ($6,930,000) ("Purchase Price").
S103.950 Deposit within 10 days of the opening of Escrow
56.826.050 Balance of Purchase Price at Close of Escrow
56.930.000 Purchase Price
3. SATISFACTION WAIVER AND RELEASE. Seller for itself and for its agents, successors
and assigns agrees that payment of the Purchase Price amounts to a full and complete
satisfaction of all compensation due and owing to Seller for the acquisition of the Real Property.
Excepting therefrom any right established pursuant to this Agreement, Seller, on behalf of itself
and its successors and assigns, fully releases, acquits and discharges Buyer and its officers,
officials, council members, employees, attorneys, accountants, other professionals, insurers, and
agents, and all entities, boards, commissions, and bodies related to any of them (collectively, the
"Released Buyer Parties") from all claims that Seller has or may have against the Released
Buyer Parties arising out of or related to Buyer's acquisition of the Property, including but not
limited to claims of (i) compensation for any improvements, including improvements pertaining to
the realty, furniture, fixture, and equipment, (ii) lost business goodwill, (iii) lost revenue or income
(past or future); (iv) lost rents, (v) damages to the remainder (i.e., severance damages) (vi)
economic or consequential damages, (vii) professional consultant fees, attorney's fees and costs,
(viii) pre -condemnation damages, (ix), any right to repurchase, leaseback (pursuant to Section
1263.615 of the Code of Civil Procedure) from Buyer, or receive any financial gain from, the sale
of any portion of the Property; (x) any right to enforce obligation(s) placed upon Buyer's pursuant
to Code of Civil Procedure sections 1245.245 and 1263.615; (xi) any rights conferred upon Seller
pursuant to Code of Civil Procedure sections 1245.245 and 1263.615 and 1263.025; and (xii) any
and all compensable interests, and/or damages, and/or claims, of any kind and nature, claimed
or to be claimed, suffered or to be suffered, by Seller, its agents, successors and assigns, by
reason of the Buyer's acquisition of the Property, excepting therefrom those promises,
agreements, warranties and/or covenants for which Buyer is responsible under this Agreement.
This Section shall survive the Close of Escrow.
Seller, on behalf of itself and its successors and assigns, expressly waives all rights under
Section 1542 of the Civil Code of the State of California ("Section 1542") and agrees that it may
4871-3953-9903 v6 Page 2
not invoke the benefits of Section 1542 in order to prosecute or assert in any manner the matters
released in this Section of the Agreement. Section 1542 provides as follows:
"A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES
NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING
THE RELEASE, WHICH IF KNOWN BY HIM OR HER MUST HAVE MATERIALLY AFFECTED
HIS OR HER SET >LdVIENT WITH THE DEBTOR."
Seller's Initials:
4. TITLE REVIEW AND TITLE INSURANCE POLICY.
A. Delivery of Title Commitment. Escrow Agent (as defined in Paragraph 7.A hereof)
shall promptly request that First American Title Insurance Company ("Title Company") deliver to
Buyer a current preliminary title commitment covering the Real Property together with legible or
best available copies of all documents referenced therein shall collectively be deemed the "Title
Report."
B. Title Review and Cure. Buyer shall have twenty (20) days following its receipt of
the Title Report (the "Title Review Period") to review same and to either approve or disapprove
the condition of title to the Real Property. On or before the expiration of the Title Review Period,
Buyer shall deliver to Seller and Escrow Agent written notice ("Buyer's Title Notice") of Buyer's
approval or disapproval of the matters reflected in the Title Report. The failure of Buyer to deliver
to Seller Buyer's Title Notice on or before the expiration of the Title Review Period shall be
deemed to constitute Buyer's disapproval of the condition of title to the Real Property. If Buyer
disapproves any matter of title shown in the Title Report, then Seller may, but shall have no
obligation to, within five (5) business days after its receipt of the Buyer's Title Notice for the Real
Property ("Seller's Election Period"), elect to eliminate or ameliorate to Buyer's satisfaction, in
Buyer's sole discretion, the disapproved title matters by giving Buyer written notice ("Seller's Title
Notice") of those disapproved title matters, if any, which Seller agrees to so eliminate by the
Closing Date. If Seller does not elect to, or is unable to, eliminate or ameliorate any disapproved
title matters, Buyer acting in its sole discretion disapproves Seller's Title Notice, or Seller fails to
timely deliver Seller's Title Notice, then Buyer shall have the right, upon delivery to Seller and
Escrow Agent (on or before five (5) business days following the expiration of Seller's Election
Period) of a written notice, to either: (a) waive its prior disapproval, in which event said
disapproved matters shall be deemed approved; or (b) terminate this Agreement and the Escrow.
Failure to take either one of the actions described in (a) and (b) above shall be deemed to be
Buyer's election to take the action described in clause (b) above. If Buyer elects (or is deemed
to have elected) to terminate this Agreement as provided in clause (b) above, this Agreement
shall automatically terminate, the parties shall be released from all further obligations under this
Agreement (except pursuant to any provisions which by their express terms survive a termination
of this Agreement), the Deposit shall be immediately returned to Buyer and Buyer shall
immediately return to Seller (or confirm in writing to Seller the destruction of) all Seller Deliverables
(see Paragraph 5.A) and all other documents, instruments and materials previously provided by
Seller to Buyer, if any (collectively, the "Property Information"). Buyer shall have been deemed
to have approved any title exception that Seller is not obligated to remove and to which either
Buyer did not object as provided above, or to which Buyer did object, but with respect to which
Buyer did not terminate this Agreement.
Anything to the contrary notwithstanding, Seller shall be obligated to remove or cause to
be removed from title, on or before the Closing and at Seller's sole cost and expense, all monetary
4871-3953-9903 v6 Page 3
liens, claims and encumbrances of record, and Buyer shall not be required to object to same; all
of which, if any, shall not become a Permitted Exception (as defined below).
C. Delivery of Title Policy at Closin j. As a condition precedent to Buyer's obligation
to acquire the Real Property and the Closing, the Title Company shall have issued and delivered
to Buyer, or shall have committed to issue and deliver to Buyer, with respect to the Real Property,
an ALTA Extended Coverage Owner's Policy of Title Insurance with endorsements required by
Buyer (the "Title Policy.") issued by the Title Company as of the date and time of the recording of
the Grant Deed for the Real Property, in the amount of the Purchase Price, subject only to the
Permitted Exceptions (as hereinafter defined), naming Buyer as the insured; have a liability
amount equal to the Purchase Price; show Buyer as the owner of the Real Property in fee simple;
and include extended coverage over the standard printed exceptions as may be required by
Buyer, including without limitation any endorsements required by Buyer. For purposes of this
Agreement, "Permitted Exceptions" shall mean only (a) any lien to secure payment of real estate
taxes, including special assessments, not delinquent, (b) the lien of supplemental taxes assessed
pursuant to Chapter 3.5 commencing with Section 75 of the California Revenue and Taxation
Code, not delinquent, (c) all matters affecting the Real Property which are created by or with the
express written consent of Buyer; (d) all exceptions disclosed by the Title Report relating to the
Real Property and which are approved or deemed approved by Buyer in accordance with
Paragraph 4.13 hereof, and (e) all applicable laws, ordinances, rules and governmental
regulations (including, without limitation, those relating to building, zoning and land use) affecting
the development, use, occupancy or enjoyment of the Real Property. Buyer agrees to pay the
premium charged for the Title Policy, and Seller shall deliver to the Title Company such
instruments, documents, releases and agreements and perform such other acts as Title Company
may reasonably require in order to issue the Title Policy, including without limitation the execution
and delivery of owner's affidavits and indemnities. Indemnification of the Title Company to induce
it to insure any otherwise un-permitted exception to title shall not be allowed except with Buyer's
prior written consent, in Buyer's sole discretion, after full disclosure to Buyer of the nature and
substance of such exception and indemnity.
D. Buyer, at its sole election, may, no later than twenty (20) days following the
Effective Date, hire a land surveyor for the purpose of preparing an ALTA survey for the Real
Property (the "Survey"). Notwithstanding the foregoing, Buyer shall have ten (10) business days
after receipt of the Survey to object to any matters of survey in writing to Seller, in which event
the procedure set forth in Paragraph 4.13 above shall apply to such Survey objections.
E. Seller agrees it shall not from and after the date of this Agreement voluntarily or
consensually perform any act which results in any additional exceptions to title that would survive
the Closing without Buyer's prior written consent. In the event that any work has been performed
on the Real Property by or on behalf of Seller prior to one hundred eighty (180) days of the
Closing, or such greater lien period as may be designated by the Title Company, and the Title
Company requires an indemnity for any potential liens on the Real Property in connection with
such work, Seller shall provide such indemnity to the Title Company at the Closing as may be
required in order to allow the Title Company to provide title insurance to the Buyer at the Closing.
F. Buyer shall have the right to reexamine title to the Real Property and in the event of
any amended, updated or modified version of the Title Report after Buyer has delivered Buyer's Title
Notice, Buyer shall have the right to object to any additional title exceptions, or modifications to
existing title exceptions, contained in such amended, updated or modified Title Report, by the same
process contained above, provided, however, that the objection and response times of each of the
parties shall be limited to five (5) days each, and the Closing shall be extended accordingly.
4871-3953-9903 v6 Page 4
5. INSPECTIONS: DUE DILIGENCE PERIOD.
A. Seller's Deliverables. Within ten (10) business days of the Effective Date, Seller
shall deliver (i) all reports, surveys and data relating to the environmental, geological, soil and/or
physical condition of the Real Property and/or the improvements thereon in the possession of
Seller or its agents, (ii) if any, agreements related to the occupation of the Real Property by a
party having a possessory rights with respect to the Real Property; and (ill) the following
"Contracts": all written and oral contracts of insurance, management, leasing, security, janitorial,
cleaning, pest control, waste disposal, landscaping, advertising, service, maintenance, operating,
repair, and other contracts and commitments in any way relating to the Real Property (collectively
(i) through (iii), the "Seller's Deliverables"). Seller will promptly deliver to Buyer supplements
and/or updates of Seller's Deliveries to the extent such items are received by Seller prior to
Closing. During the Due Diligence Period, Buyer shall have the right to conduct and complete an
investigation of all matters pertaining to Seller's Deliveries and all other matters pertaining to the
Real Property and Buyer's acquisition thereof. In this regard, Buyer shall have the right to contact
the Motel Guests to determine potential eligibility for relocation benefits, governmental agencies
and officials and other parties and make reasonable inquiries concerning Seller's Deliveries and
any and all other matters pertaining to the Real Property. Seller agrees to reasonably cooperate
with Buyer in connection with its investigation of Seller's Deliveries and all other matters pertaining
to the Real Property. Seller shall not unreasonably refuse to extend the Due Diligence Period
(as defined below) in the event that Buyer needs additional time to perform the assessments and
inspections set forth in Section 5 of this Agreement.
B. Seller's Disclosures. Within ten (10) business days of the Effective Date, Seller
will provide Buyer with all disclosures required by statute and which are applicable to the Real
Property, including, but not limited to, a disclosure as designated under Section 25359.7 of the
Health and Safety Code; whereby Seller is required to disclose if there are any hazardous
substances located on or beneath the Real Property that are known to Seller.
C. Inspections in General; Relocation Survey. Beginning on the Effective Date, and
continuing thereafter for a period of thirty (30) days (the "Due Diligence Period"), Buyer and its
agents shall have a license (the "License") to enter upon the Real Property for the purpose of
making physical inspections and assessing relocation obligations with respect to any Motel
Guests and any other persons occupying the Real Property in compliance with Buyer's obligation
under the California Relocation Assistance Law, California Government Code section 7260 et
seq. (the "Relocation Assessment"), at Buyer's sole risk, cost and expense.
Prior to any entry onto the Real Property pursuant to the License, Buyer or Buyer's agent
conducting the inspection shall provide Seller with a certificate of insurance naming Seller as an
additional insured and with an insurer and insurance limits and coverage reasonably satisfactory
to Seller (which coverage shall include, at a minimum, general liability, personal injury and broad
form property damage with limits of liability not less than $1,000,000 combined single limit per
occurrence and $2,000,000 aggregate). All of such entries upon the Real Property shall be at
reasonable times during normal business hours and after at least 24 hours prior notice to Seller
or Seller's agent, and Seller or Seller's agent shall have the right to accompany Buyer during any
activities performed by Buyer on the Real Property. Seller shall inform its Motel Guests of such
inspections and coordinate with such Motel Guests in order to facilitate the inspection as provided
herein.
At Seller's request and provided that Seller is not in default of this Agreement, Buyer shall
provide Seller (at no cost to Seller) with a copy of the results of any final form tests and inspections
4871-3953-9903 v6 Page 5
made by Buyer (to the extent in Buyer's possession as of the date of request by Seller), excluding
only market and economic feasibility studies; provided however, Buyer shall not be liable for any
such material provided to Seller and Buyer makes absolutely no representation or warranty of any
kind regarding any such tests/inspections. If any inspection or test physically disturbs the Real
Property, Buyer will restore the Real Property to substantially the same condition as existed
before the inspection or test. Buyer shall defend, indemnify and hold Seller, Seller's members,
managers, officers, tenants, agents, contractors and employees harmless from and against any
and all losses, costs, damages, claims, or liabilities, including but not limited to, mechanic's and
material men's liens and Seller's reasonable attorneys' fees, arising out of or in connection with
Buyer's or its agents' entry upon or inspection of the Real Property. Notwithstanding the foregoing,
Buyer's indemnity, defense and hold harmless obligations hereunder shall not apply to any pre-
existing condition that is discovered by Buyer during the course of Buyer's exercise of the License
rights. The License shall be deemed revoked upon any termination of this Agreement. The
provisions of this Paracirarh 5.0 shall survive the Closing or the earlier termination of this
Agreement.
D. Environmental Inspections. The inspections under Paragraph 5.0 may include
Phase I environmental inspections of the Real Property, Phase II environmental inspections or
other invasive inspections or sampling of soil or materials, including without limitation construction
materials, either as part of the Phase I inspections or any other inspections. If Buyer chooses to
perform any Phase II or other invasive inspections or sampling, (i) Buyer shall notify Seller in
writing not less than five (5) days before the date in which the Phase II or other invasive inspection
or sampling is scheduled to take place, (ii) such notice shall include the proposed scope of work
and the party who will perform the work shall be subject to Seller's review and reasonable
approval and (iii) the work shall be performed in accordance with such terms and conditions as
Seller shall reasonably prescribe (e.g., insurance). At Seller's request and provided that Seller is
not in default of this Agreement, Buyer shall deliver to Seller (at no cost to Seller) copies of any
final form Phase 11 or other environmental reports (to the extent in Buyer's possession as of the
date of request by Seller) to which Seller consents as provided above; provided however, Buyer
shall not be liable for any information contained in such reports and Buyer makes absolutely no
representation or warranty of any kind regarding any such reports.
In the event Buyer determines that remediation is required due to the presence of
Hazardous Materials upon the Real Property, then, notwithstanding anything herein to the
contrary, the Buyer and Seller shall promptly meet and confer to determine whether remediation
will be performed and the financial responsibility for such remediation. In the event that the Parties
cannot reach agreement on the process for determining the necessary remediation and financial
responsibility thereto, the Agreement shall be deemed terminated without fault of either party.
E. Termination During Due Diligence Period. If Buyer determines, in its sole
discretion, before the expiration of the Due Diligence Period that the Real Property is
unacceptable for Buyer's purposes, then Buyer shall have the right to terminate this Agreement
by giving to Seller notice of termination ("Termination Notice") on or before the expiration of the
relevant Due Diligence Period, in which event Deposit shall be immediately returned to Buyer,
Buyer shall immediately return (or confirm the destruction of) all Real Property Information, if any,
to Seller and, except for those provisions of this Agreement which expressly survive the
termination of this Agreement, the parties hereto shall have no further obligations hereunder. If
Buyer fails to deliver a Termination Notice or Acceptance Notice (as defined below) to Seller on
or before the expiration of the Due Diligence Period, then Buyer shall be deemed to have elected
to terminate this Agreement and the Deposit shall be immediately returned to Buyer. Buyer's
delivery (or deemed delivery) of a Termination Notice to Seller with respect to the Real Property
4871-3953-9903 v6 Page 6
shall constitute Buyer's election to terminate this Agreement with respect to the Real Property as
provided above in this Paragraph 55.
F. Notice of Acceptance. If Buyer determines, in its sole discretion, on or before the
expiration of the Due Diligence Period that the Real Property is acceptable for Buyer's purposes,
Buyer shall deliver to Seller a written notice of acceptance ("Acceptance Notice") on or before the
expiration of the Due Diligence Period, in which event Buyer shall be deemed to have accepted
the condition of the Real Property and shall waive its termination right under this Paragraph 5.
Upon receipt of the Acceptance Notice, Seller shall have the right to schedule the Close of Escrow
at any time prior to the Outside Closing Date (as defined in Paragraph 9.A) upon sixty days
advance written notice to Buyer ("Seller's Notice to Close Escrow"). Upon Buyer's receipt of
Seller's Notice to Close Escrow, the parties shall proceed to close the escrow as provided in
Paragraph 8.
G. Prooertv "As -Is. Where -is." To the maximum extent permitted by applicable law,
and except for Seller's representations and warranties in Paragraph 13 of this Agreement and
any warranties of title contained in the Grant Deed or other documents delivered at the Close of
Escrow ("Seller's Warranties"), this sale is made and will be made without any other
representation, covenant, or warranty of any kind (whether express, implied, or, to the maximum
extent permitted by applicable law, statutory) by Seller. As a material part of the consideration for
this Agreement, Buyer agrees to accept the Real Property on an "as is" and "where is" basis, with
all faults, and without any other representation or warranty, all of which Seller hereby disclaims,
except for Seller's Warranties.
6. SELLER'S PRE -CLOSING OBLIGATIONS. Seller hereby covenants and agrees as
follows:
A. Operations. During the time period commencing upon the Effective Date and
terminating upon the Closing or the earlier termination of this Agreement, Seller must operate and
manage the Real Property substantially in accordance with its customary practices, and all
applicable zoning laws, including, without limitation, land use entitlements, permit conditions and
requirements, provided, however, that Seller must exercise good faith efforts to ensure that
lodgers do not remain in occupation of any accommodation on the Real Property for a continuous
period of 30 days or more, Seller must take reasonable efforts to reduce existing occupancy, and
within 10 days before the anticipate Closing, Seller must discontinue offering transient occupancy
to new Motel Guest, within the confines of applicable law. Notwithstanding the foregoing, Seller
will not involuntarily terminate the occupancy of any Motel Guest in advance of or solely because
of the Closing.
B. Maintenance. During the time period commencing upon the Effective Date and
terminating upon the Closing or the earlier termination of this Agreement, Seller shall maintain
the Real Property in substantially its present condition, subject to normal wear and tear, and Seller
shall not diminish the quality or quantity of maintenance and upkeep services heretofore provided
to the Real Property.
C. No Leases. During the time period commencing upon the Effective Date and
terminating upon the Closing or the earlier termination of this Agreement, Seller shall not enter
into any residential leasing arrangement.
D. NoticesNiolations. During the time period commencing upon the Effective Date of
this Agreement and terminating on the Closing or the earlier termination of this Agreement, Seller
4871-3953-9903 v6 Page 7
shall promptly deliver to Buyer any and all notices and/or other written communications delivered
to or received from: (i) any Motel Guest; (ii) any party under any of the Contracts; and/or (iii) any
governmental authority relating to the Real Property or operation thereof. During the time period
commencing upon the Effective Date of this Agreement and terminating on the Closing or the
earlier termination of this Agreement, Seller shall deliver to Buyer prompt notice of: (i) the
occurrence of any inspections of the Real Property by any governmental authority; (ii) any default
by a party to any Contract; (iii) any notices of violations of laws, ordinances, orders, directives,
regulations or requirements issued by, filed by or served by any governmental agency against or
affecting Seller or any part or aspect of the Real Property.
E. Assumed Contracts. During the time period commencing upon the Effective Date
and terminating upon the Closing or the earlier termination of this Agreement, Seller shall
administer and timely perform all of its material obligations under the Contracts. Furthermore,
during the time period commencing upon the date of delivery by Buyer to Seller of Buyer's
Acceptance Notice pursuant to Paragraph 5.F and terminating on the Closing or the earlier
termination of this Agreement, as applicable, Seller shall not terminate, amend or modify any of
the Assumed Contracts or enter into any new Contract not terminable at Closing, without the prior
written consent of Buyer in each instance, which consent may be granted or withheld in Buyer's
sole discretion. Seller agrees that, except for the Assumed Contracts, prior to the Closing Seller
shall be responsible for terminating all Contracts and other obligations (including, but not limited
to, any and all management, hotel/motel operating, listing and/or leasing agreements) relating to
the maintenance, operation, management and leasing of the Real Property, and Seller shall be
liable for any risks, costs and penalties related to such termination.
F. Monetary Obli�aations. Seller shall pay and satisfy in full any and all liens, liabilities
and encumbrances placed, or caused to be placed, of record against the Real Property
evidencing a monetary obligation which can be removed by the payment of money (the "Monetary
Obligations") on or before the Closing Date.
G. New Liens. Liabilities or Encumbrances. Seller shall not cause, grant or permit any
new liens, liabilities, encumbrances or exceptions to title to the Real Property without the prior
written consent of Buyer in each instance, which consent may be granted or denied in the sole
and absolute discretion of Buyer.
H. Termination of Negotiations. Upon the expiration of the Due Diligence Period,
Seller shall terminate all negotiations with any other person or entity other than Buyer for the sale
or disposition of the Real Property.
I. Indemnification. Seller will hold harmless, defend with counsel selected by Buyer,
and indemnify Buyer and all its officers, volunteers, employees and representatives from and
against any and all suits, actions, or claims, of any character whatever, brought for, or on account
of, any injuries or damages sustained by any person or property resulting or arising from any
negligent or wrongful act, error or omission by Seller or any of Seller's officers, agents, employees,
or representatives, in the performance of this Agreement and/or in Seller's use and operation of
the Property, except for such loss or damage arising from Buyer's sole negligence or willful
misconduct. For purposes of this section "Buyer" includes Buyer's officers, officials and
employees. It is expressly understood and agreed that the this provision will survive termination
of this Agreement.
4871-3953-9903 v6 Page 8
7. SELLER'S DELIVERIES
A. Seller's Deliveries to Escrow Agent at Closinq. On or before 5:00 p.m. on the last
business day prior to the Closing Date, Seller shall deliver to Escrow Agent the items described
in this Paragraph 7.
i. Seller's Grant Deed. One (1) original of Grant Deed, duly executed and
acknowledged by Seller. Pursuant to Paragraph 9.D hereof, all documentary transfer tax
information shall be affixed to Grant Deed upon recordation.
ii. Bill of Sale. One (1) original of the Bill of Sale, duly executed by Seller.
iii. Certificate of Non -Foreign Status. One (1) original of the Certificate of Non -
Foreign Status, duly executed and acknowledged by Seller.
iv. Assignment and Assumption of Contracts. Two (2) counterpart originals of
the Assignment and Assumption of Contracts in substantially the same form and substance as
the form attached hereto as Exhibit D, duly executed by Seller.
V. Seller's Charges. In addition to the Purchase Price and other funds
deposited by Buyer with Escrow Agent, such funds as may be required to: (a) discharge all
Monetary Obligations; and (b) pay any amounts required to be paid by Seller in accordance with
the provisions of Paragraphs 9.D and 9.E hereof out of the sales proceeds.
vi. Seller's Affidavits; Certificates and Evidence of Authority. (a) Any and all
affidavits, indemnities and any other written documentation required by the Title Company as a
condition to the issuance of the applicable Title Policy; and (b) to the extent required by the Title
Company, Escrow Agent and/or Buyer, as applicable, evidence that Seller and those acting for
Seller have full authority to consummate the transaction contemplated by this Agreement, as
modified through the Closing including, without limitation, certified copies of the corporate, limited
liability company, partnership or other resolutions authorizing the transaction contemplated by this
Agreement.
vii. Seller's Closing Statement. Seller's Closing Statement, duly executed by
Seller.
viii. Additional Documents. Such additional documents, instructions or other
items as may be necessary or appropriate to comply with the provisions of this Agreement and to
effect the transactions contemplated hereby, provided that such additional documents,
instructions or other items shall not cause any additional liability, cost or obligation to Seller,
except as otherwise provided for in this Agreement.
B. Seller's Deliveries to Buyer at Closing. On or before the Closing, Seller shall deliver
to Buyer the items described in this Paragraph 6.13.
i. Assumed Contracts. Permits and Entitlements and Intangible Property.
Originals, or if the originals are not available, copies of all Assumed Contracts, Permits and
Entitlements and Intangible Property in Seller's possession or control.
ii. Motel Guest Re ister. An updated, current motel guest register which
includes, at a minimum , all the dates of occupancy and monetary rates paid for occupancy,
4871-3953-9903 v6 Page 9
relating to the Real Property, certified by Seller as being true, correct and complete in all material
respects as of the Closing Date.
iii. Keys. All keys and security cards, if any, relating to the Real Property, and
such additional documents, instructions or other items as may be necessary to operate any
security systems on the Real Property.
8. BUYER'S DELIVERIES
A. Buyer's Deliveries to Escrow Agent at Closing. On or before 5:00 p.m. on the last
business day before the Closing Date, Buyer shall deliver to Escrow Agent the items described in
this Paragraph 8.
Purchase Price. The Purchase Price pursuant to Paragraph 2 hereof.
ii. Assignment and Assumption of Contracts. Two (2) counterpart originals of
the Assignment and Assumption of Contracts, in substantially the same form and substance as
the form attached hereto as Exhibit D, duly executed by Buyer.
iii. Buyer's. Charges. In addition to the Purchase Price and other funds
deposited by Buyer with Escrow Agent, funds sufficient to pay all amounts required to be paid by
Buyer in accordance with the provisions of Paragraphs 9.D and 9.E hereof.
iv. Evidence of Authoritv. To the extent required by the Title Company, Escrow
Agent, and/or Seller, as applicable, evidence that Buyer and those acting for Buyer have full
authority to consummate the transaction contemplated by this Agreement, as modified through
the Closing including, without limitation, certified copies of the corporate, limited liability company,
partnership or other resolutions authorizing the transactions contemplated by this Agreement.
V. Buyer's Closing Statement. Buyer's Closing Statement, duly executed by
Buyer.
vi. Additional Documents. Such additional documents, instructions or other
items as may be necessary or appropriate to comply with the provisions of this Agreement and to
effect the transactions contemplated hereby, provided that such additional documents,
instructions or other items shall not cause any additional liability, cost or obligation to Buyer,
except as otherwise provided for in this Agreement.
9. ESCROW.
A. General Escrow Provisions. Buyer and Seller agree to open an escrow in
accordance with this Agreement at First American Title Insurance Company, 18500 Von Karman
Ave., Suite 600, Irvine, CA 92612, Attn. Jeffery Paschal/Jenevie Garcia ("Escrow Agent") no later
than ten (10) days following the Effective Date. The escrow shall be deemed open upon the
delivery of a fully -executed copy of this Agreement to Escrow Agent (the "Opening of Escrow").
The "Close of Escrow" or "Closing" shall mean and refer to (i) Seller's receipt of the Purchase
Price and (ii) transfer and conveyance of the Real Property to Buyer by Grant Deed. This
Agreement constitutes the joint escrow instructions of Buyer and Seller, and Escrow Agent to
whom these instructions are delivered is hereby empowered to act under this Agreement. The
parties hereto agree to do all acts reasonably necessary to close this escrow in the shortest
possible time, but in no event later than 90 days following the Effective Date (the "Outside Closing
4871-3953-9903 v6 Page 10
Date") unless extended by the Parties in writing. Seller shall, on or before the Closing, deliver to
Escrow Agent a fully -executed and notarized original of the Grant Deed, in form reasonably
approved by Buyer. Buyer agrees to deposit the Purchase Price and related escrow fees and
charges, less applicable deposits if any, upon demand of Escrow Agent on the Closing Date.
Buyer and Seller each agree to deposit with Escrow Agent any additional instruments and funds
as may be reasonably necessary to complete this transaction. The Deposit shall be delivered to
Escrow by wire transfer within ten (10) days after opening escrow.
B. Insurance. Insurance policies are not to be transferred, and Seller will cancel its
own policies after Closing.
C. Escrow Funds: Disbursements. All funds received in this escrow shall be
deposited with other escrow funds in a general interest -bearing escrow trust account(s) and may
be transferred to any other such escrow trust account in any federally insured State or National
Bank doing business in the State of California.
D. Cost and Expenses.
i. Seller shall pay: (a) Seller's share of prorations; (b) Seller's Share of
Seller's Broker Commission (as provided in Parch 10), and (c) Seller's attorneys' fees.
ii. Buyer shall pay: (a) all recording costs, documentary transfer taxes, deed
stamps and similar costs, fees and expenses payable in connection with the recordation of the
Grant Deed; (b) the premium for the Title Policy and the cost of any binders or endorsements to
the Title Policy requested by Buyer; (c) Escrow Agent's fees and costs for the Escrow; (d) Buyer's
share of prorations; and (e) Buyer's attorneys' fees.
E. Prorations and Adiustments. The following adjustments and prorations shall be
made as of 12:01 a.m. on the Closing Date ("Proration Date"), as though Buyer held title to the
Real Property throughout the entire day in which the Closing occurs. Such adjustments and
prorations shall be made subject to the following provisions:
i. Revenues. All motel rental fees, receipts and other revenues (including, but
not limited to, reimbursements for Real Property Expenses, common area maintenance, real and
personal property taxes, insurance and other operating expense reimbursements, if applicable,
but excluding percentage rent, if applicable) (collectively, the "Revenues"), received by Seller as
of the Closing, but which are properly allocable to the period after the Proration Date, shall be
credited to Buyer at the Closing. To the extent there are any Revenues owing to Seller as of the
Closing which relate to periods of time prior to the Proration Date, but which have not actually
been collected by Seller as of the Closing ("Delinquent Revenues"), Buyer shall not be obligated
to pay to Seller (or give Seller a credit for), the amount of such Delinquent Revenues on the
Closing. All Revenues which are received by Seller or Buyer subsequent to the Closing Date shall
be applied: first, to amounts due to Buyer; and second, to Delinquent Revenues due to Seller.
Seller and Buyer hereby agree to promptly remit to the other the amount of any Revenues
received and owing to each other pursuant to the provisions of this Paragraph 9.E(i).
Notwithstanding any provision in this Paragraph 9E to the contrary, Seller retains its rights to
recover Delinquent Revenues, including, without limitation, the right to collect (without eviction)
the same from the Motel Guests and/or third parties responsible for payment of such Delinquent
Revenues.
4871-3953-9903 v6 Page 11
ii. O; eratin- Expenses. All costs, fees and expenses (other than Taxes)
relating to the operation, management and repair of the Real Property (collectively, the "Operating
Ex enses"), shall be prorated between Seller and Buyer at the Closing as of the Proration Date.
iii. Taxes and Assessments. All real and personal property ad valorem taxes,
if any, including without limitation, all supplemental taxes attributable to the fiscal year in which
the Closing occurs shall be paid by Seller and Seller shall be entitled to seek a refund from the
Orange County Tax Collector for any such taxes and assessments paid for the portion of the fiscal
year following the Closing Date. Special assessments, if any, shall be prorated to the Closing
Date. The Buyer is not subject to the assessment of property taxes (whether general, special or
supplemental) once it takes title to the Real Property.
iv. Transient Occupancy Taxes. All transient occupancy taxes collected by
Seller prior to the Closing and not yet remitted to the City of Anaheim shall be paid by Seller.
V. Assumed Contracts. All Operating Expenses accruing under, arising out of
or relating to any of the Assumed Contracts shall be prorated between Seller and Buyer at the
Closing as of the Proration Date.
vi. Final Adjustment after Closing. If final prorations of special assessments,
if any, or ad valorem taxes relating to pre -Closing issues/events cannot be made at the Closing,
then, provided Buyer or Seller identify any such proration ("Post Closing Proration") in writing
before the Closing, Buyer and Seller agree to allocate such items on a fair and equitable basis as
soon as invoices or bills are available, with final adjustment to be made as soon as reasonably
possible after the Closing.
F. Close of Escrow: Instructions to Escrow Agent. On the Closing Date, provided that
all conditions precedent have been satisfied or waived by the appropriate party, Escrow Agent
shall take the following actions in the order indicated below:
i. With respect to all closing documents delivered to Escrow Agent
hereunder, and to the extent necessary, Escrow Agent is authorized to insert into all blanks
requiring the insertion of dates the date of the recordation of the Grant Deed or such other date
as Escrow Agent may be instructed in writing by Seller and Buyer.
ii. Pay any amount necessary to place title in the condition necessary to
satisfy Paragraph 4.0 of this Agreement and charge Seller.
iii. Pay any escrow fees, charges and costs payable under Paragraph 9.D of
this Agreement and charge Buyer and Seller as set forth in Paragraphs 9.D and 9.E.
iv. Deliver to Seller, in cash or current funds, the Purchase Price, plus or
minus, as the case may be, the amounts determined in accordance with the provisions of this
Agreement.
California.
V. Record the Grant Deed in the Official Records of Orange County,
vi. Cause the Title Company to issue the Title Policy for the Real Property.
4871-3953-9903 v6 Page 12
vii. Deliver to Seller and Buyer a final closing statement which has been
certified by Escrow Agent to be true and correct.
G. Time of the Essence: Failure to Close Due to Buyer's Default. TIME IS OF THE
ESSENCE IN THESE INSTRUCTIONS AND ESCROW SHALL CLOSE ON OR BEFORE THE
OUTSIDE CLOSING DATE, UNLESS SUCH DATE IS EXTENDED BY MUTUAL AGREEMENT
OF THE PARTIES.
10. BROKERAGE FEES.
Buyer and Seller each represent to the other that no brokers have been involved in this
transaction other than Daniel Shamooelian of DS Real Estate I Keller Williams and Ramtin Rafiee
of BRC Advisors Commercial Real Estate, who represent Seller (collectively, "Seller's Broker").
The parties understand that to the extent Seller's Broker is entitled to a commission in connection
with this transaction, that Seller shall be responsible to Seller's Broker for am_ and all brokerage
fee pursuant to the terms of any agreement or agreements heretofore executed by and between
Seller and the Seller's Broker ("Seller's Share of Seller's Broker Commission").
Except as otherwise provided above, the parties warrant and agree that neither party has
had any contact or dealings regarding the Real Property, or any communication in connection
with the subject matter of this transaction, through any licensed real estate broker or person, who
can claim a commission or finder's fee as a procuring cause of the sale contemplated in this
Agreement. If any other broker or finder perfects a claim for a commission or finder's fee based
on any contract, dealings, or communication with a party (the "Indemnifying Party"), then the
Indemnifying Party shall indemnify, defend, and hold the other party (the "Non -indemnifying
Party") harmless from all costs and expenses (including reasonable attorney fees and costs of
defense) incurred by the Non -indemnifying Party in connection with such claim.
11. RENTALS AND OCCUPANCY BY SELLER. Except for guest occupants of the motel
generally referred to as the Motel Guests, Seller warrants that there will be no oral or written
leases, subleases or other tenancies in effect, or parties in possession, pertaining to all or any
portion of the Real Property on the Closing Date, and Seller further agrees to indemnify, defend,
and hold Buyer harmless and reimburse Buyer for any and all of its losses and expenses,
including without limitation reasonable attorney's fees and costs, occasioned by reason of any
such lease, sublease, or tenancy other than by the Motel Guests.
12. CONDITIONS TO CLOSE.
A. Buyer's Conditions Precedent. The following shall be conditions precedent to
Buyer's obligation to close, in addition to all other conditions precedent set forth in this Agreement.
i. The City Council of the City of Anaheim, acting as the legislative body and
governing Board of Buyer, shall have approved this Agreement and authorized its designative
representative to execute on behalf of Buyer all documents necessary to the Close of Escrow.
ii. Buyer shall have reviewed the inventory of Personal Property immediately
prior to the Closing and reasonably determined that the Personal Property is generally the same
as when previously appraised, taking into account that during the term of the Agreement the
Personal Property is subject to normal wear and tear and may have necessarily been replaced if
damaged or worn out.
4871-3953-9903 v6 Page 13
iii. Seller shall have timely delivered to Escrow Agent all of the items to be
delivered by Seller pursuant to Paracrar.h 7.A hereof. Seller shall have timely delivered to Buyer
all of the items to be delivered by Seller pursuant to Paragraph 7.B hereof.
iv. As of the Closing, Seller shall have timely performed all of the material
obligations required by the terms of this Agreement to be performed by Seller.
V. Title Company is irrevocably committed to issue the Title Policy.
vi. All representations and warranties made by Seller to Buyer in this
Agreement shall be true and correct as of the Closing.
vii. The Real Property (or portion thereof) shall not have been damaged or
destroyed by casualty or otherwise and no portion of the Real Property shall have been
condemned or subject to any pending or threatened condemnation proceedings.
Unless all of Buyer's conditions precedent contained in this Agreement are satisfied within
the time period specified, or if no time period is specified, prior to or at Closing, Buyer, at its
election, may, either (a) extend the date for Closing until such conditions are satisfied, but no
longer than ten (10) days beyond the original Closing date, or (b) terminate this Agreement and
have the Deposit and any interest earned thereon immediately refunded to Buyer without further
authorization or approvals of any kind from Seller or any other party, or (c) waive in writing the
satisfaction of any such conditions, in which event this Agreement shall be read as if such
conditions no longer existed. Notwithstanding the foregoing, if the failure of a Buyer's condition
to Closing is caused by a default by Seller, Buyer shall have the right to exercise the remedies
set forth in this Agreement.
B. Seller's Conditions Precedent. The following shall be conditions precedent to
Seller's obligation to close, in addition to all other conditions precedent set forth in this Agreement.
i. As of the Closing, Buyer shall have timely performed all of the material
obligations required by the terms of this Agreement to be performed by Buyer.
ii. All representations and warranties made by Buyer to Seller in this
Agreement shall be true and correct as of the Closing.
Unless all of Seller's conditions precedent contained in this Agreement are satisfied within
the time period specified, or if no time period is specified, prior to or at Closing, Seller, at its
election, may, either (a) extend the date for Closing until such conditions are satisfied, but no
longer than ten (10) days beyond the original Closing date, or (b) terminate this Agreement and
have the Deposit and any interest earned thereon immediately released to the Seller without any
further authorizations or approvals of any kind from Buyer or any other party, or (c) waive in writing
the satisfaction of any such conditions, in which event this Agreement shall be read as if such
conditions no longer existed. Notwithstanding the foregoing, if the failure of a Seller's condition
to Closing is caused by a default by Buyer, Seller shall have the right to exercise any other
remedies set forth in this Agreement.
13. SELLER'S REPRESENTATIONS. Seller represents and warrants to Buyer that as of the
date hereof and as of the Closing:
4871-3953-9903 v6 Page 14
A. All of the Contracts are terminable without penalty upon not more than thirty (30)
days' notice. There are no Contracts with any person or entity relating to the Real Property which
must be assumed by Buyer (or which will be deemed assumed by the Buyer upon the Buyer
becoming the owner of the Real Property), other than the Assumed Contracts. The Assumed
Contracts, if any, are in full force and effect and constitute valid and enforceable agreements of
Seller, free and clear of all liens, charges, encumbrances and adverse claims, and no event has
occurred which with the giving of notice or the passage of time or both would result in a default
thereunder. Seller has obtained, or on or before the Closing will have obtained, all requisite
consents of third parties to the assignment to and assumption by Buyer of the Assumed Contracts.
B. To the best of Seller's knowledge and belief, there are no pending or threatened
improvements, liens, or special assessments made or to be made against the Real Property by
any governmental authority.
C. There are not any pending, or to Seller's actual knowledge threatened, lawsuit(s),
investigations(s), inquiry(ies), actions(s) or other proceeding(s), including without limitation any
condemnation proceeding, affecting the Real Property or the right to use and/or occupy it.
D. There are not any unsatisfied mechanics' or materialmen's lien(s), or any right to
lien, affecting the Real Property or any portion thereof. In the event Seller receives any such
notice prior to the Closing, Seller shall immediately notify Buyer and, if required by the Title
Company, will provide the Title Company with such indemnifications or security as it may require
to insure title to the Real Property, with ALTA extended mechanic's lien coverage, at the Closing
without exception for any unrecorded labor, materialmen's or mechanics' claim of lien.
E. This Agreement is, and all the documents executed by Seller which are to be
delivered to Buyer at the Closing will be, duly authorized, executed, and delivered by Seller. The
obligations contained in this Agreement, are and will be legal, valid, and binding obligations of
Seller enforceable against Seller in accordance with their respective terms. This Agreement does
not, and will not, violate any provisions of any agreement to which Seller is a party or to which it
is subject.
F. Seller has full power and authority to sell, convey and transfer the Real Property
as provided for in this Agreement, all necessary actions required on the part of Seller to execute
this Agreement and consummate the transaction contemplated hereby have been taken, or will
be by Closing, the persons executing this Agreement on behalf of Seller have all requisite
authority to execute this Agreement, and this Agreement is binding and enforceable against
Seller.
G. To Seller's actual knowledge, the Real Property is not and never has been in
violation of any Environmental Laws (as hereinafter defined) with respect to Hazardous Materials
and there is not currently and have not been any underground storage tanks on the Real Property.
Seller has not received any written notices that the Real Property is or may be in violation of any
Environmental Law. Seller has disclosed to Buyer all information in Seller's possession or control
relating to the environmental condition of the Real Property. Seller has not received any
information from neighboring property owners indicating they have any concerns about existing
environmental conditions which could affect the Real Property or suggesting they might look to
Seller for contribution to clean up such condition. In the event Buyer discovers any Hazardous
Materials conditions on the Real Property at any time prior to Closing, Buyer shall have the right
to terminate this Agreement upon written notice thereof to Seller, whereupon the Escrow Agent
shall return the Deposit and all interest earned thereon to Buyer, and thereafter this Agreement
4871-3953-9903 v6 Page 15
shall be deemed void and neither party shall have any further rights or obligations hereunder.
Notwithstanding anything to the contrary herein, the effect of the representations made in this
subparagraph shall not be diminished or deemed to be waived by any inspections, tests or
investigations made by Buyer or its agents. For purposes of this Agreement, "Hazardous
Materials" shall mean any pollutants, contaminants, hazardous or toxic substances, materials or
wastes (including petroleum, petroleum by-products, radon, asbestos and asbestos containing
materials, polychlorinated biphenyls ("PCBs"), PCB -containing equipment, radioactive elements,
infectious agents, and urea formaldehyde), as such terms are used in any Environmental Laws
(excluding solvents, cleaning fluids and other lawful substances used in the ordinary operation
and maintenance of the Real Property, to the extent in closed containers) and "Environmental
Laws" shall mean all federal, state and local environmental laws, rules, statutes, directives,
binding written interpretations, binding written policies, ordinances and regulations issued by any
governmental or quasi -governmental body or agency having jurisdiction over Seller, the Real
Property or any portion thereof and in effect as of the date of this Agreement with respect to or
which otherwise pertain to or affect the Real Property or improvements located thereon, or any
portion thereof, the use, ownership, occupancy or operation of the Real Property or the
improvements, or any portion thereof, or any owner of the Real Property, and as same have been
amended, modified or supplemented from time to time prior to the date of this Agreement,
including but not limited to the Comprehensive Environmental Response, Compensation and
Liability Act of 1980 (42 U.S.C. § 9601 et seq.), the Hazardous Substances Transportation Act
(49 U.S.C. § 1802 et seq.), the Resource Conservation and Recovery Act (42 U.S.C. § 6901 et
seq.), the Water Pollution Control Act (33 U.S.C. § 1251 et seq.), the Safe Drinking Water Act (42
U.S.C. § 300f et seq.), the Clean Air Act (42 U.S.C. § 7401 et seq.), the Solid Waste Disposal Act
(42 U.S.C. § 6901 et seq.), the Toxic Substances Control Act (15 U.S.C. § 2601 et seq.), the
Emergency Planning and Community Right -to -Know Act of 1986 (42 U.S.C. § 11001 et seq.), the
Radon and Indoor Air Quality Research Act (42 U.S.C. § 7401 note, et seq.), the Superfund
Amendment Reauthorization Act of 1986 (42 U.S.C. § 9601 et seq.), comparable state and local
laws, and any and all rules and regulations which have become effective prior to the date of this
Agreement under any and all of the aforementioned laws.
H. There are no options, rights of first refusal, purchase agreements, management,
employment, service, equipment, supply, maintenance, water, sewer or other utility agreements,
agreements with municipalities (including improvement or development escrows or bonds) or
other agreements, oral or written, with respect to or affecting the Real Property or any portion
thereof, which are or will be binding upon Buyer, or which will burden the Real Property after
Closing, except as set forth in the Title Report. Seller will not enter into or amend any agreements
or contracts prior to the Closing without the prior written consent of Buyer.
I. Seller has not received any notice requiring any work, repairs, construction,
alterations or installations on or in connection with the Real Property, or asserting any violation of
any federal, state, county or municipal laws, ordinances, codes, orders, regulations or
requirements affecting any portion of the Real Property, including, without limitation, the
Americans with Disabilities Act, any similar State of California Disability Act, any applicable
environmental laws or regulations, or any agreements of record. Seller has not received any
notice from any insurance company which has issued a policy with respect to the Real Property
or by any board of fire underwriters (or other body exercising similar functions) claiming any
defects or deficiencies or requesting the performance of any repairs, alterations or other work,
and Seller will promptly notify Buyer of and comply with any such notice or requirement at Seller's
cost if such notice is received prior to Closing.
4871-3953-9903 v6 Page 16
J. Except as set forth in the Title Report, Seller has no actual knowledge of any bonds
affecting the Real Property.
K. Seller has no actual knowledge of any material error or omission contained in the
Seller Deliverables.
L. To Seller's actual knowledge, the Real Property is not in violation of any applicable
law, code, ordinance, rule or regulation, or agreement of record.
M. The parties hereto acknowledge that Buyer is contemplating taking the Real
Property through eminent domain proceedings. A Resolution of Necessity was adopted on May
21, 2024, to acquire the Property through eminent domain. The parties to this Agreement
acknowledge and agree that the Property is being acquired by Buyer under threat of and in lieu
of condemnation. Notwithstanding, Seller warrants and represents that the sale of the Real
Property to the Buyer is voluntary and that, in accordance with the Uniform Relocation Assistance
and Real Property Acquisition Policies Act (URA) and California Government Code Section 7260,
Seller and its officers and members are owner -occupants who move as a result of a voluntary
acquisition and are not eligible for relocation assistance as a displaced person and will not receive
relocation assistance associated with moving a business, farm, non-profit organization, residence
or personal property from the Real Property.
N. No representation, statement or warranty by Seller contained in this Agreement or
in any exhibit attached hereto contains or will contain any untrue statements or omits, or will omit,
a material fact necessary to make the statement of fact therein recited not misleading. If, after
Seller's execution hereof, any event occurs or condition exists of which Seller becomes aware or
should be aware of as owner of the Real Property, which renders any of the representations
contained herein untrue or misleading, Seller shall promptly notify Buyer in writing.
Each of the representations and warranties of Seller contained herein shall survive the
Closing.
14. BUYER'S REPRESENTATIONS. Buyer represents and warrants to Seller that as of the
date hereof and as of the Closing:
A. Buyer is a public body corporate and politic validly existing under the laws of the
State of California. Buyer has all requisite power and authority to execute and deliver this
Agreement and the ancillary documents to which Buyer is a party and to perform its obligations
hereunder and thereunder and to effect the transactions contemplated hereby and thereby. All
requisite action has been taken to authorize and approve the execution, delivery and performance
by Buyer of this Agreement and the documents to which Buyer is a party.
B. The execution, delivery and performance by Buyer of this Agreement and the
Transaction Documents to which Buyer is a party, and the consummation of the transactions
contemplated hereby and thereby, will not: (a) violate any provision of Buyer's organization
documents; (b) violate, conflict with or result in a breach of or default under any term or provision
of any contract or agreement to which Buyer is a party or by or to which Buyer or any of its assets
or properties are or may be bound or subject; or (c) violate any order, judgment, injunction, award
or decree of any court or arbitration body, or any governmental, administrative or regulatory
authority, or any other body, by or to which Buyer is or may be bound or subject.
4871-3953-9903 v6 Page 17
Each of the representations and warranties of Buyer contained herein shall survive the
Closing.
15. RELOCATION. Seller acknowledges and agrees that neither Buyer's acquisition of the
Real Property nor the construction and subsequent use of the Real Property have caused or will
cause Seller to be a "displaced person" as that term is used in California's Relocation Assistance
Act (Gov. Code §§ 7260 et seq.), California regulations (Title 25 of California's Code of
Regulations), the Uniform Relocation Assistance and Real Property Acquisition Policies Act of
1970 (42 U.S.C. §§ 4601-4655) and the federal regulations (49 C.F.R. Part 24). As such, Seller,
on behalf of itself and its agents, successors and assigns, releases and discharges Buyer, and
any and all of Buyer's employees, agents, officers, servants, representatives, contractors,
attorneys and assigns, from any and all liability, responsibility or obligation to provide relocation
benefits and assistance of any kind whatsoever arising out of or in any way relating to any claim
for relocation assistance and compensation under applicable provisions of, inter alia, the Uniform
Relocation Assistance and Real Property Acquisition Policies Act (42 U.S.C. §§ 4601 et seq.),
California's Relocation Assistance Act (Gov. Code §§ 7260 et seq.), California regulations, and
federal regulations resulting from the Buyer's acquisition of the Real Property and the construction
and subsequent use of the Real Property. This Section shall survive the Close of Escrow.
16. I.R.S. FORM "W-9". It is further understood and agreed by Seller that closing of this
escrow is subject to and contingent upon Seller executing an Internal Revenue Service Form
"W-9" and/or 1099 and any other closing or escrow documents reasonably required by the Title
Company, and depositing same into Escrow.
17. NOTICE OF TAX WITHHOLDING REQUIREMENTS. It is further understood and agreed
by Buyer and Seller that closing of this escrow is subject to and contingent upon Seller executing
a "Transferor's Affidavit of Non -Foreign Status" and California Form 593-C (Individual Sellers) or
593-W (Real Estate Withholding Exemption Certificate and Waiver Request for Non -Individual
Sellers) and depositing a copy of same into escrow.
18. AUTHORITY. This Agreement shall be binding on and shall inure to the benefit of the
heirs, executors, administrators, successors and assigns of Buyer and Seller. The parties upon
whose benefit the signature appears below warrant, each to the other, that the person whose
signature appears below has the legal authority to bind the party on whose behalf the signature
appears to the terms of this Agreement, and that by doing so, such party is not in breach of any
other contract or agreement that would affect or impair the ability of said party to perform its
obligations under this Agreement.
19. ENTIRE AGREEMENT. This Agreement contains all the terms, promises, covenants,
conditions and representations made or entered into by or between Seller and Buyer relative to
the disposition and acquisition of the Real Property. This Agreement may not be modified or
amended unless such amendment is set forth in writing and executed by both Seller and Buyer.
20. SEVERABILITY. The provisions of this Agreement are severable, and if any portion is
held invalid or otherwise unenforceable, the parties intend that all other provisions shall remain in
full force and effect.
21. ATTORNEY FEES. In the event of any controversy, claim or dispute relating to this
instrument or any breach thereof, the prevailing party shall be entitled to recover its reasonable
attorney(s) fees, costs and expenses (as actually incurred), whether or not the matter is
4871-3953-9903 v6 Page 18
prosecuted to final judgment, including those on appeal. Attorney(s) fees shall include all costs,
expert witness fees, and all other reasonable expenses.
22. REMEDIES FOR DEFAULT.
A. Buyer's Default. Buyer shall be deemed to be in default under this Agreement if
after the expiration of the Due Diligence Period, Buyer fails, for any reason other than Seller's
default under this Agreement or the failure of a condition precedent to Buyer's obligation to
perform under this Agreement, to meet, comply with, or perform any covenant, agreement, or
obligation required on its part within the time limits and in the manner required in this Agreement,
or a material breach shall have occurred of any representation or warranty (made by Buyer) by
reason of Buyer's actual fraud or intentional misrepresentation; provided, however, that no such
default shall be deemed to have occurred unless and until Seller has given Buyer written notice
of the default, describing the nature of the default, and Buyer has failed to cure such default within
five (5) business days after the receipt of such notice (but in any event before the Closing Date,
unless such default occurs after Closing).
B. Remedies for Buyer's Default. IF BUYER DEFAULTS IN ITS OBLIGATIONS
UNDER THIS AGREEMENT TO CLOSE THE ESCROW AND ACQUIRE THE REAL
PROPERTY FROM SELLER ON THE CLOSING DATE THROUGH NO FAULT OF SELLER,
THEN SELLER, AS ITS SOLE AND EXCLUSIVE REMEDY, SHALL RETAIN THE DEPOSIT
AS LIQUIDATED DAMAGES. BUYER AND SELLER AGREE THAT IT WOULD BE
IMPRACTICAL OR EXTREMELY DIFFICULT TO FIX THE ACTUAL DAMAGES SUFFERED
BY SELLER BECAUSE OF SUCH DEFAULT, THAT THE TOTAL AMOUNT OF THE DEPOSIT
AND ANY INTEREST EARNED THEREON SHALL CONSTITUTE A REASONABLE
ESTIMATE AND AGREED STIPULATION OF DAMAGES IN THE EVENT OF SUCH DEFAULT
BY BUYER AND THAT SELLER SHALL HAVE NO OTHER RIGHT OR CAUSE OF ACTION
AGAINST BUYER FOR DAMAGES OR OTHERWISE ARISING FROM SAID DEFAULT. If, after
the Closing Date, Seller determines that Buyer has breached any material representation or
warranty set forth in this Agreement, then Seller shall have the right to bring an action for actual
damages against Buyer. 05
Seller's Initials: Buyer's Initials:
C. Seller's Default. Seller shall be deemed to be in default under this Agreement if
Seller fails, for any reason other than Buyer's default under this Agreement or the failure of a
condition precedent to Seller's obligation to perform under this Agreement, to meet, comply with,
or perform any covenant, agreement, or obligation required on its part within the time limits and
in the manner required in this Agreement, or a material breach shall have occurred of any
representation or warranty (made by Seller); provided, however, that no such default shall be
deemed to have occurred unless and until Buyer has given Seller written notice of the default,
describing its nature, and Seller has failed to cure such default within five (5) business days after
receipt of such notice (but in any event before the Closing Date, unless such default occurs after
Closing).
D. Remedies for Seller's Default. If Seller defaults in its obligations under this
Agreement to sell the Real Property to Buyer on the Closing Date through no fault of Buyer, then
Buyer at its option may either (i) have the right to specific performance of this Agreement and all
of its general and special damages, or (ii) receive an immediate return of the Deposit, together
with interest thereon. If, after the Closing Date, Buyer determines that Seller has breached any
4871-3953-9903 v6 Page 19
material representation or warranty set forth in this Agreement, then Buyer shall have the right to
bring an action for general and special damages against Seller. If this Agreement is terminated
before the Closing Date for Seller's default, then, in addition to any remedy Buyer has under this
Agreement, Seller shall reimburse Buyer for the reasonable costs actually incurred by Buyer in
conducting its due diligence, but in no event shall Buyer be entitled to request/receive (nor shall
Seller be obligated to pay) any due diligence reimbursement amount in excess of $50,000.
23. SUCCESSORS. The terms, conditions, covenants and agreements set forth herein shall
apply to and bind the heirs, executors, administrators, assigns and successors of the parties
hereto.
24. NOTICES. All written notices or demands of any kind which either party hereto may be
required or may desire to serve on the other in connection with this Agreement shall be served
by personal service, by registered or certified mail, or recognized overnight courier service. Any
such notice or demand so to be served by registered or certified mail, recognized overnight courier
service or electronic mail transmission shall be delivered with all applicable delivery charges
thereon fully prepaid and, if the party so to be served be Buyer, addressed to Buyer as follows:
City of Anaheim
Attention: Grace Ruiz-Stepter, Executive Director
Anaheim Housing Authority
201 S. Anaheim Blvd., 1011 Floor
Anaheim, CA 92805
Telephone No: 714-765-4324
Email: jcarabez@anaheim.net
with copies thereof to: Office of the City Attorney
Attention: City Attorney
200 S. Anaheim Blvd., 31 Floor
Anaheim, CA 92805
Telephone No. 714-765-5356
Email: cityattorneysoffice@anaheim.net
and, if the party so to be served be Seller, addressed to Seller as follows:
Dhanuba Hospitality, Inc.
c/o Rainbow Inn
831 S. Beach Blvd.
Anaheim, CA 92805
Attention: Sumantrai Ahir
Telephone No.:
Email:
with copies thereof to: Daniel Shamooelian
DS Real Estate I Keller Williams
439 N. Canon Dr. 3rd Floor
Beverly Hills, CA 90210
4871-3953-9903 v6 Page 20
Telephone No.: 310-651-1800
Email: Daniel@DSrealestate.com
Service of any such notice or demand so made by personal delivery, registered or certified mail,
recognized overnight courier or electronic mail transmission shall be deemed complete on the
date of actual delivery as shown by the addressee's registry or certification receipt or, as to email
transmissions, by "answer back confirmation" or other computer confirmation (provided that a
copy of such notice or demand is delivered by any of the other methods provided above within
one (1) business day following receipt of such email transmission), as applicable, or at the
expiration of the third (3rd) business day after the date of dispatch, whichever is earlier in time.
Either party hereto may from time to time, by notice in writing served upon the other as aforesaid,
designate a different mailing address to which or a different person to whose attention all such
notices or demands are thereafter to be addressed.
25. GOVERNING LAW. This Agreement shall be governed by the laws of the State of
California, without regard to conflict of law principles.
26. COUNTERPARTS. This Agreement may be executed simultaneously in one or more
counterparts, each of which shall be deemed an original but all of which together shall constitute
one and the same instrument.
27. EXHIBITS INCORPORATED BY REFERENCE. All Exhibits attached to this Agreement
are incorporated in this Agreement by this reference.
28. HEADINGS; CONSTRUCTION. The various headings of this Agreement are included for
convenience only and shall not affect the meaning or interpretation of this Agreement or any
provision hereof. When the context and construction so require, all words used in the singular
herein shall be deemed to have been used in the plural and the masculine shall include the
feminine and the neuter and vice versa. The use in this Agreement of the term "including" and
related terms such as "include" shall in all cases mean "without limitation." All references to "days"
in this Agreement shall be construed to mean calendar days unless otherwise expressly provided
and all references to "business days" shall be construed to mean days on which national banks
are open for business.
29. NO THIRD PARTY BENEFICIARIES. This Agreement is for the sole and exclusive benefit
of the parties hereto and their respective permitted successors and assigns, and no third party is
intended to, or shall have, any rights hereunder.
30. JOINT PRODUCT OF PARTIES. This Agreement is the result of arms -length negotiations
between Seller and Buyer and their respective attorneys, if any. Accordingly, neither party shall
be deemed to be the author of this Agreement and this Agreement shall not be construed against
either party.
31. CALCULATION OF TIME PERIODS. Unless otherwise specified, in computing any period
of time described herein, the day of the act or event after which the designated period of time
begins to run is not to be included and the last day of the period so computed is to be included
at, unless such last day is a Saturday, Sunday or legal holiday for national banks in California, in
which event the period shall run until the end of the next day which is neither a Saturday, Sunday,
or legal holiday. Unless otherwise expressly provided herein, the last day of any period of time
described herein shall be deemed to end at 5:00 p.m., California time.
4871-3953-9903 v6 Page 21
32. NO PERSONAL LIABILITY. Notwithstanding anything stated to the contrary herein,
Seller's liability under this Agreement shall be limited to Seller's interest in the Real Property and
Seller's constituent partners, members, managers, directors, officers, employees or agents shall
not have any personal liability hereunder to Buyer or its successor or assigns. Notwithstanding
anything stated to the contrary herein, Buyer's liability under this Agreement shall be limited to
the Buyer set forth herein and none of Buyer's officials, employees or agents shall have any
personal liability hereunder to Seller or its constituent partners, members, managers, directors,
officers, employees or agents.
33. EFFECTIVE DATE OF THIS AGREEMENT. This Agreement shall take effect immediately
upon the approval and execution of this Agreement by the Executive Director of the Anaheim
Housing Authority (the "Effective Date").
34. SECTION 1033 EXCHANGE. Seller may consummate the sale of the Real Property as
part of a so-called like kind exchange (the "Exchange") pursuant to Section 1033 of the Internal
Revenue Code of 1986, as amended (the "Code"), provided that: (i) the Closing shall not be
delayed or effected by reason of the Exchange by more than one (1) year following the Effective
Date, nor shall the consummation or accomplishment of the Exchange be a condition precedent
or condition subsequent to any obligations under this Agreement, (ii) the Exchange shall be
effected through a qualified intermediary, and Buyer shall not be required to take an assignment
of this Agreement or hold title to any real property for purposes of effecting the Exchange, and
(iii) the party making the Exchange shall pay any additional costs that would not otherwise have
been incurred by the other had the Exchange not been made. The terms of this Section shall not
affect or diminish the rights of either party hereto, and Buyer shall not be deemed to have
warranted that the Exchange complies with Section 1033 of the Code.
35. NO RIGHT TO MARKET. Seller shall not market or enter into negotiations with other
potential buyers during the term of this Agreement.
36. ACQUISITION BY STIPULATED JUDGMENT IN LIEU OF DEED. In the event Seller is
unable to deliver title to the Property in a reasonable time in accordance with the terms of this
Agreement, as determined by Buyer at its sole and complete discretion, or in the event this
Agreement is terminated as a result of any default by Seller, Buyer may, if Buyer's governing
Board duly decides to do so in compliance with the California eminent domain law, file an action
in eminent domain to pursue the acquisition of the Property. Seller agrees to waive all claims and
defenses to any such eminent domain action (including challenges to the right to take) and agrees
that, at District's election and in District's sole and unfettered discretion, this Agreement shall
constitute a stipulation which may be filed in such action as final and conclusive evidence of just
compensation for the acquisition, including all of the items provided in Chapter 9, Title 7 of the
Code of Civil Procedure commencing with Section 1263.010. The provisions of this Section shall
survive any termination of this Agreement.
37. CONSENT TO DISMISSAL OF CONDEMNATION. If Buyer files an action in eminent
domain to pursue the acquisition of the Property and Escrow subsequently closes, Seller hereby
agrees and consents to the dismissal of the eminent domain action, and waives any and all claim
to money, including interest, that may be deposited in the Superior Court in such an action, hereby
stipulates to the release of such deposited money back to Buyer, and hereby waives any right to
recover any litigation costs or attorney's fees as a result of the dismissal or abandonment of the
eminent domain action by Buyer. The provisions of this Section shall survive any termination of
this Agreement or Close of Escrow.
4871-3953-9903 v6 Page 22
[Remainder of page intentionally left blank; signatures appear on next page.]
4871-3953-9903 v6 Page 23
IN WITNESS WHEREOF, the parties hereto have executed this Agreement the day and year set
forth below.
5/28/2024
Date:
Date:
SELLER:
DHANUBA HOSPITALITY, INC., a California
corporation
By:
Sumantrai Ahir
President
BUYER:
ANAHEIM HOUSING AUTHORITY,
a public body corporate and politic
By:
Grace Ruiz-Stepter
Executive Director
ATTEST:
THERESA BASS, CMC, AUTHORITY SECRETARY
M
Theresa Bass, CMC
APPROVED AS TO FORM:
OFFICE OF THE CITY ATTORNEY
By:
Robert Fabela, City Attorney
BUKE, WILLIAMS AND SORENSEN, LLP.
By:
Alan A. Sozio, Special Counsel
4871-3953-9903 v6 Page 24
EXHIBIT A
LEGAL DESCRIPTION
The Land referred to herein below is situated in Anaheim, County of Orange, State of
California and is described as follows:
THE SOUTH 96 FEET OF THE NORTH 481 FEET OF THE EAST HALF OF THE
EAST HALF OF THE SOUTHEAST QUARTER OF THE SOUTHEAST QUARTER AND
THE SOUTH 96 FEET OF THE NORTH 481 FEET OF THE EAST 8 FEET OF THE
WEST HALF OF THE EAST HALF OF THE SOUTHEAST QUARTER OF THE
SOUTHEAST QUARTER OF SECTION 14, IN TOWNSHIP 4 SOUTH, RANGE 11
WEST, IN THE RANCHO LOS COYOTES, AS SHOWN ON A MAP RECORDED IN
BOOK 51, PAGE 11 OF MISCELLANEOUS MAPS IN THE OFFICE OF THE COUNTY
RECORDER OF ORANGE COUNTY, CALIFORNIA.
EXCEPT THAT PORTION THEREOF CONVEYED TO THE STATE OF CALIFORNIA
BY DEED RECORDED MARCH 5, 1951 IN BOOK 2153, PAGE 250 OF OFFICIAL
RECORDS.
APN 079-164-13
EXHIBIT A —PAGE 1
4871-3953-9903 v6
EXHIBIT B
FORM OF GRANT DEED
Recording Requested by:
CITY CLERK
CITY OF ANAHEIM
P.O. Box 3222
Anaheim, California 92803
WHEN RECORDED MAIL TO:
CITY CLERK
CITY OF ANAHEIM
P.O. Box 3222
Anaheim, California 92803
EXEMPT FROM RECORDING FEE —
GOVERNMENT AGENCY BUSINESS Per
Gov't Codes 6103 and 27383
SPACE ABOVE THIS LINE FOR RECORDER'S USE
DOCUMENTARY TRANSFER TAX $
❑ Computed on full value of property conveyed, or
❑ Computed on full value less liens & encumbrances remaining thereon at time of sale.
Signature of declarant or agent determining tax, firm name
GRANT DEED
FOR A VALUABLE CONSIDERATION, receipt of which is hereby acknowledged, Dhanuba
Hospitality, Inc., a California corporation ("Grantor"), hereby GRANTS to the Anaheim
Housing Authority, a public body corporate and politic ("Grantee"), the real property situated in
the County of Orange, State of California, described as follows:
EXHIBIT B — PAGE 1
4871-3953-9903 v6
See Exhibit A attached hereto and incorporated by reference herein.
Grantor:
Dhanuba Hospitality, Inc., a California
corporation
[EXHIBIT ONLY — DO NOT SIGN]
Date:
Sumantrai Ahir
President
[Certificate of Acceptance
required for recording]
EXHIBIT B — PAGE 2
4871-3953-9903 v6
EXHIBIT A TO GRANT DEED
LEGAL DESCRIPTION OF PROPERTY
[To be inserted]
EXHIBIT B — PAGE 3
4871-3953-9903 v6
EXHIBIT C
BILL OF SALE
FOR GOOD AND VALUABLE CONSIDERATION, the receipt and sufficiency of which is
hereby acknowledged, Dhanuba Hospitality, Inc., a California corporation (hereinafter called
"Seller"), does hereby give, grant, bargain, sell, transfer and deliver unto Anaheim Housing
Authority, a public body corporate and politic ("Buyer"), pursuant to that certain Agreement for Sale
of Property and Joint Escrow Instructions dated as of ,, 2024 (the "Agreement"), all
of Seller's right, title and interest in and to that certain personal property listed on the attached
Schedule "1" (the "Personal Property") owned by Seller and located on and used in connection
with the ownership and/or operation of the real property more particularly described on Schedule
"2" attached hereto ("Real Property"), which Real Property is being conveyed to Buyer on or about
of even date herewith. The Personal Property is hereby acquired by Buyer "AS -IS" without any
representation or warranty of any kind or nature of Seller, express, implied or statutory, as to the
nature of or title to the Personal Property or its fitness for Buyer's intended use of same.
EXECUTED as of _, 2024.
SELLER:
Dhanuba Hospitality, Inc., a California
corporation
[EXHIBIT ONLY — DO NOT SIGN]
By.
Sumantrai Ahir
President
[SIGNATURES CONTINUE ON FOLLOWING PAGE]
EXHIBIT C — PAGE 1
4871-3953-9903 v6
BUYER:
ANAHEIM HOUSING AUTHORITY,
a public body corporate and politic
0
Grace Ruiz-Stepter
Executive Director
ATTEST:
THERESA BASS, CMC, AUTHORITY SECRETARY
By:
Theresa Bass, CMC
APPROVED AS TO FORM:
OFFICE OF THE CITY ATTORNEY
By:
Robert Fabela, City Attorney
BUKE, WILLIAMS AND SORENSEN, LLP.
2-2
Alan A. Sozio, Special Counsel
EXHIBIT C — PAGE 2
4871-3953-9903 v6
SCHEDULE1
SCHEDULE OF PERSONAL PROPERTY
[To be inserted]
EXHIBIT C — PAGE 3
4871-3953-9903 v6
SCHEDULE 2
LEGAL DESCRIPTION OF REAL PROPERTY
The real property referred to herein is situated in the County of Orange, City of Anaheim, State
of California, and is described as follows:
[To be inserted]
EXHIBIT C — PAGE 4
4871-3953-9903 v6
EXHIBIT D
FORM OF ASSIGNMENT AND ASSUMPTION OF CONTRACTS
This ASSIGNMENT AND ASSUMPTION OF CONTRACTS (this "Assignment ") is
executed as of the day of , 2024 ("Assignment Date"), by and between
Dhanuba Hospitality, Inc., a California corporation ("Assignor"), and Anaheim Housing Authority, a
public body corporate and politic ("Assignee").
RECITALS:
A. Assignor and Assignee are parties to that certain Agreement for Sale of Property
and Joint Escrow Instructions dated as of [to be inserted] (the "Agreement"), pursuant to which
Assignor agreed to sell to Assignee, and Assignee agreed to purchase from Assignor the
Property. Capitalized terms used herein and not separately defined shall have the same
definitions as set forth in the Agreement.
B. Assignee has acquired fee title to the Real Property from Assignor on the
Assignment Date. Assignor now desires to assign and transfer to Assignee all of Assignor's rights
and interests in and to all warranties and guarantees provided to Assignor by vendors and/or
contractors with respect to the real and personal property described in Schedule 1 hereto
(collectively, the "Contracts").
NOW, THEREFORE, in consideration of the foregoing recitals and for other good and
valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Assignor
and Assignee hereby agree as follows:
1. Assignment and Assumption. Effective as of the Assignment Date, Assignor
hereby grants, transfers, conveys, assigns and delegates to Assignee all of its rights and interests
of Assignor in, to and under the Contracts that are set forth in Attachment No. 1 attached hereto
and made a part hereof; provided, however, such assignment, transfer and sale shall not include
any rights or claims arising prior to the Assignment Date which Assignor may have against any
party to the Contracts.
2. No Warranties. Assignor is transferring each of the Contracts to Assignee (to the
extent the terms of any of the Contracts do not limit or restrict such right) without any warranty of
any kind or nature. This Assignment shall not be construed as a representation or warranty by
Assignor as to the transferability or enforceability of the Contracts, and Assignor shall have no
liability to Assignee in the event that any or all of the Contracts (a) are not transferable to Assignee
or (b) are canceled or terminated by reason of this Assignment or any acts of Assignee.
Notwithstanding any provisions of this Assignment to contrary effect, Assignor is released and
exonerated from any duties, liabilities or obligations with respect to the Contracts which arose
prior to the transfer of such Contracts.
3. Dispute Costs. In the event of any dispute between Assignor and Assignee arising
out of the obligations of the parties under this Assignment or concerning the meaning or
interpretation of any provision contained herein, the losing party shall pay the prevailing party's
costs and expenses of such dispute, including, without limitation, reasonable attorneys' fees and
costs. Any such attorneys' fees and other expenses incurred by either party in enforcing a
judgment in its favor under this Assignment shall be recoverable separately from and in addition
to any other amount included in such judgment, and such attorneys' fees obligation is intended to
EXHIBIT D — PAGE 1
4871-3953-9903 v6
be severable from the other provisions of this Assignment and to survive and not be merged into
any such judgment.
4. CounterF) rts. This Assignment may be executed in counterparts, each of which
shall be deemed an original, and all of which shall, taken together, be deemed one document.
5. Survival. This Assignment and the provisions hereof shall inure to the benefit of
and be binding upon the parties to this Assignment and their respective successors, heirs and
permitted assigns.
6. No Third Party Beneficiaries. Except as otherwise expressly set forth herein,
Assignor and Assignee do not intend, and this Assignment shall not be construed, to create a
third -party beneficiary status or interest in, nor give any third -party beneficiary rights or remedies
to, any other person or entity not a party to this Assignment.
7. Governinca Law. This Assignment shall be governed by, interpreted under, and
construed and enforceable in accordance with, the laws of the State of California.
[SIGNATURES CONTINUE ON FOLLOWING PAGE]
EXHIBIT D — PAGE 2
4871-3953-9903 v6
IN WITNESS WHEREOF, the parties Assignor and Assignee have duly executed this
Assignment as of the day and year first above written.
ASSIGNEE:
ANAHEIM HOUSING AUTHORITY,
a public body corporate and politic
By:
ATTEST:
THERESA BASS, CMC, AUTHORITY SECRETARY
M
Theresa Bass, CMC
APPROVED AS TO FORM:
OFFICE OF THE CITY ATTORNEY
In
Leonie Mulvihill, Assistant City Attorney
BUKE, WILLIAMS AND SORENSEN, LLP.
By:
Alan A. Sozio, Special Counsel
Grace Ruiz-Stepter
Executive Director
ASSIGNOR:
DHANUBA HOSPITALITY, INC., a California
corporation
By:
[EXHIBIT ONLY — DO NOT SIGN]
Sumantrai Ahir
President
EXHIBIT D — PAGE 3
4871-3953-9903 v6
SCHEDULE 1
SCHEDULE OF CONTRACTS
[To be inserted]
EXHIBIT D — PAGE 4
4871-3953-9903 v6
4871-3953-9903 v6
COOPERATION AGREEMENT
(Rainbow Inn Motel)
This COOPERATION AGREEMENT (Rainbow Inn Motel) ("Cooperation
Agreement") dated as of , 2024 ("Date of Agreement"), is entered into by and
between the CITY OF ANAHEIM, a charter city and California municipal corporation
("City"), and the ANAHEIM HOUSING AUTHORITY, a public body, corporate and
politic ("Authority"). City and Authority may at times be referred to individually as a
"Parry" and collectively as the "Parties."
RECITALS
A. The Anaheim Housing Authority ("Authority") is a California housing
authority duly organized and existing under the California Housing Authorities Law, Part 2
of Division 24, Section 34200, et seq., of the Health and Safety Code ("HAL"), and has been
authorized to transact business and exercise the power of a California housing authority
pursuant to action of the City Council ("City Council") of the City of Anaheim ("City"); and
B. The City is a California municipal corporation and charter city; and
C. On May 21, 2024, the Authority approved a Resolution declaring that the
acquisition of the real property located at 831 South Beach Boulevard is a necessity of public
interest and convenience for public purposes; and
D. Subsequent to the Housing Authority meeting, the Owner Dhanuba
Hospitality, Inc, a California Corporation ("Seller") agreed to sell the 42-unit motel located at
831 S. Beach Boulevard, also known as the Rainbow Inn Motel to the Authority for
$6,930,000. The Agreement for Sale of Property and Joint Escrow Instructions between the
Authority and the Seller reflects the total purchase price. The Motel will provide affordable
housing opportunities in West Anaheim and will assist with the City's efforts in the
revitalization of Beach Boulevard; and
E. It is the intention of the Authority and City to acquire Rainbow Inn Motel
property for the purposes of creating a mixed -income development inclusive of varying
affordable housing opportunities; and
F. The Authority and City have considered and approved that Agreement for
Purchase and Sale by the City of Anaheim and the Anaheim Housing Authority, sourced in
whole or part, from Low Moderate Income Housing Asset Funds and City Neighborhood
Reserve Funds for the purposes of creating a mixed -income development inclusive of varying
affordable housing opportunities. To this end, the City desires to make available and transfer
to the Authority by this Cooperation Agreement $3,000,000 of City Neighborhood Reserve
Funds to enable the Authority to acquire the Rainbow Inn Motel.
G. City and Authority desire to redevelop the Site by acquiring and developing
the Site with a mixed -income development inclusive of varying affordable housing
opportunities.
NOW, THEREFORE, FOR AND IN CONSIDERATION OF THE MUTUAL
PROMISES, COVENANTS AND CONDITIONS CONTAINED HEREIN, THE
PARTIES AGREE AS FOLLOWS:
Section 1. TRANSFER OF FUNDS BY CITY TO AUTHORITY. City
agrees to transfer to Authority Three Million Dollars ($3,000,000) of City Neighborhood
Reserve Funds ("Project Funds") held by the City to enable the Authority to acquire the
Rainbow Inn Motel.
Section 2. LIABILITY AND INDEMNIFICATION. In contemplation of the
provision of Section 895.2 of the California Government Code imposing certain tort liability
jointly upon public entities solely by reason of such entities being parties to an agreement as
defined by Section 895.4 and 895.6 of such Code, each of the Parties, as between themselves,
pursuant to the authorization contained in Section 895.4 and 895.6 of such Code, will each
assume the full liability imposed on it, or any of its officers, agents, or employees by law for
injury caused by negligent or wrongful act or omission occurring in the performance of this
Cooperation Agreement to the same extent that such liability would be imposed in the
absence of Section 895.2 of such Code.
(a) To achieve the above -stated purposes, each Party indemnifies and
holds harmless the other Party for any loss, costs or expense that may be imposed upon such
other Party solely by virtue of such Section 895.2. The provisions of Section 2778 of the
California Civil Code are made part hereof as if fully set forth herein.
Section 3. EFFECTIVE DATE. This Cooperation Agreement shall take effect
from and after the date of approval hereof by the Authority Board and the City Council.
Section 4. REPRESENTATIONS AND WARRANTIES
(a) Representations and Warranties of Authority. Authority hereby
represents and warrants to City as follows:
(i) Authority of Anaheim Housing Authority. Authority
represents and warrants to City it is a public body, corporate and politic, duly existing
pursuant to the HAL, and it has been authorized to transact business pursuant to action of the
City Council. Authority has full power and authority to execute and deliver this Cooperation
Agreement and to accept the funds contemplated hereunder, to execute and deliver
documents or instruments, if any, executed and delivered, or to be executed and delivered,
pursuant to this Cooperation Agreement, and to perform and observe the terms and
provisions of all of the above.
(ii) Authority of Persons _Executing_ Documents. This
Cooperation Agreement and all other documents or instruments executed and delivered, or to
be executed and delivered, pursuant to this Cooperation Agreement have been executed and
delivered by persons who are duly authorized to execute and deliver the same for and on
behalf of Authority, and all actions required under Authority's organizational documents and
applicable governing law for the authorization, execution, delivery and performance of this
2
Cooperation Agreement and all other documents or instruments executed and delivered, or to
be executed and delivered, pursuant to this Cooperation Agreement, have been duly taken.
(b) Representations and Warranties of City. City represents and warrants to
Authority that it is a charter city and municipal corporation. City has full right, power and
lawful authority to enter into this Cooperation Agreement and the execution, performance
and delivery of this Cooperation Agreement by City, and persons on behalf of City, have
been fully authorized by all requisite actions on the part of the City Council.
Section 5. DEFAULT AND REMEDIES.
(a) Events of Default. Failure by either Party to duly perform, comply
with, or observe any of the conditions, terms, or covenants of this Cooperation Agreement
shall be an Event of Default. The Party who so fails or delays must immediately commence
to cure, correct or remedy such failure or delay, and shall complete such cure, correction or
remedy with reasonable diligence and during any period of curing shall not be in default.
The injured Party shall give written notice of default to the Party in default, specifying the
default complained of by the injured Party. If the default is not commenced to be cured
within thirty (30) days after service of such notice of default and is not cured promptly in a
continuous diligent manner in a reasonable period of time after commencement, the
defaulting Parry shall be liable for any damages caused by such default, and the non
defaulting Parry may thereafter commence action for damages with respect to such default or
for specific performance of this Cooperation Agreement.
(b) Remedies. The occurrence of an Event of Default by Authority that is
not cured within the time set forth herein shall relieve City of any obligation to disburse the
Project Funds. The Authority may seek specific performance of this Cooperation Agreement
for City's failure to provide the Project Funds as provided under this Cooperation Agreement.
The non -defaulting Party may seek money damages or any other remedy available at law or
equity against the defaulting Party for an Event of Default hereunder.
Section 6. MISCELLANEOUS
(a) Time. Time is of the essence in this Cooperation Agreement.
(b) Notices. Any notice requirement set forth herein shall be deemed to
be satisfied as follows: (i) three (3) days after mailing of the notice first class United States
certified mail, postage prepaid, or (ii) the next business day after the notice or communication
has been delivered by hand or sent by telecopy or overnight delivery service, addressed to the
appropriate Parry. The designated person for delivery of notices hereunder shall be as
follows: (i) to the City Manager for notices to City, and (ii) to the Authority Executive
Director for notices to Authority.
(c) Attorneys' Fees. If either Party brings an action or proceeding to
enforce, protect or establish any right or remedy hereunder, the prevailing Party shall be
entitled to recover from the other Party its costs of suit and reasonable attorneys' fees.
(d) No Third Parties Benefited. This Cooperation Agreement is made
and entered into for the sole protection and benefit of City, its successors and assigns, and the
Authority, its successors and assigns, and no other person or persons shall have the right of
action hereon.
(e) Successors and Assigns. The terms hereof shall be binding upon and
inure to the benefit of the successors and assigns of the parties hereto; provided, however,
that no assignment of Authority's rights hereunder shall be made, voluntarily or by operation
of law, without the prior written consent of City and that any such assignment without said
consent shall be void.
(f) Construction of Words. Except where the context otherwise requires,
words imparting the singular number shall include the plural number and vice versa, words
imparting persons shall include firms, associations, partnerships and corporations, and words
or either gender shall include the other gender.
(g) Partial Invalidity. If any provision of this Cooperation Agreement
shall be declared invalid, illegal, or unenforceable, the validity, legality, and enforceability of
the remaining provisions hereof shall not in any way be affected or impaired.
(h) Governing Law. This Cooperation Agreement and any instruments
given pursuant hereto shall be construed in accordance with and be governed by the laws of
the State of California.
(i) Amendment. This Cooperation Agreement may not be changed
orally, but only by agreement in writing signed by Authority and City.
0) Captions and Headings. Captions and headings in this Cooperation
Agreement are for convenience of reference only,and are not to be considered in construing
the Cooperation Agreement.
[signature blocks for Cooperation Agreement on next page]
4
IN WITNESS, THE PARTIES HAVE EXECUTED THIS COOPERATION
AGREEMENT (RAINBOW INN MOTEL) AS OF THE EFFECTIVE DATE IN THE
FIRST PARAGRAPH ABOVE.
"CITY"
CITY OF ANAHEIM
a municipal corporation
Dated:
ATTEST:
THERESA BASS, CITY CLERK
Theresa Bass
APPROVED AS TO FORM:
CITY ATTORNEY
Ryan O. Hodge
Deputy City Attorney
Grace Ruiz-Stepter
Director of Housing and Community Development
AUTHORITY:
ANAHEIM HOUSING AUTHORITY,
a public body, corporate and politic
Dated:
ATTEST:
THERESA BASS, AUTHORITY SECRETARY
Theresa Bass
Executive Director
5
SECRETARY'S CERTIFICATE
STATE OF CALIFORNIA )
COUNTY OF ORANGE ) ss.
CITY OF ANAHEIM )
I, THERESA BASS, Secretary of the Anaheim Housing Authority, do hereby certify that the foregoing
is the original Resolution No. AHA-2024-005 adopted at a regular meeting provided by law, of the
Anaheim Housing Authority held on the 18th day of June. 2024, by the following vote of the members
thereof:
AYES: Chairperson Aitken and Authority Members Kurtz, Leon, Rubalcava,
Faessel and Meeks
NOES: None
ABSTAIN: Authority Member Diaz
ABSENT: None
IN WITNESS WHEREOF, I have hereunto set my hand this 19th day of June, 2024.
SECRnIqfY OF THE ANAHEIM HOUSING AUTHORITY
(SEAL)