HomeMy WebLinkAboutResolution No. 19-7889 - Approving 1st Amend to the P&S Agreement w-Downey Hospitality, LLC - 9066 Firestone Blvd• r •, 1
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WHEREAS, the City ("Seller") has negotiated a Purchase and Sale Agreement
("Agreement") with Downey Hospitality, LLC ("Buyer"), pursuant to which the City would sell the
Property located at 9066 Firestone Boulevard Downey, CA, for a sales price of $2,525,000; and
WHEREAS, the City Council has determined that approval of the Agreement and the
sale transaction contemplated thereby, is in the best interest of the City and the public health,
safety and welfare.
WHEREAS, the Buyer has requested removal of the requirement to obtain entitlements
prior to close of escrow. The Parties agree and acknowledge that close of escrow shall occur
prior to Buyer obtaining building permits for the Project, and that building permits are part of the
package of approvals defined as "Entitlements" under the Original Agreement. Accordingly,
(i) Buyer waives the condition precedent to Buyer's obligation to close escrow as set forth in
Section 2.3.1(5) of the original Agreement, and (ii) the Seller waives the condition precedent to
Seller's obligation to close escrow as set forth in Section 2.3.2(3) of the original Agreement.
WHEREAS, Buyer and Seller mutually agree that the Schedule of Performance shall be
as follows: (i) Buyer shall obtain all required building permits for the Project on or before
December 31, 2019, (ii) Buyer shall commence construction, and call for first building inspection
of the Project on or before March 31, 2020, and (iii) Buyer shall complete construction and
obtain all required certificates of occupancy for the Project on or before September 30, 2021.
Buyer and Seller acknowledge, agree, and understand that if Buyer fails to comply with and
facet of the Schedule of Performance, Seller shall have the right to exercise the Purchase
Option set forth in Section 5.10 of the Original Agreement. All requirements set forth in this
Section 3 shall survive the close of escrow and remain in full force and effect until the earlier of
(i) the date on which Buyer obtains all necessary certificates of occupancy for the Project, and
(ii) the date on which Seller completes the repurchase of the Property pursuant to Section 5.10
of the original Agreement.
WHEREAS, Buyer and Seller acknowledge and agree that they have achieved mutual
agreement on (►) the Schedule of Performance, and (ii) on the Site Elevations and Site Design
as set forth in the Entitlements obtained by Buyer from Seller to date. Buyer and Seller further
acknowledge and agree to waive the requirement to enter into a Disposition and Development
Agreement as a condition to closing escrow. Accordingly, (i) Buyer waives the condition
precedent to Buyer's obligation to close escrow as set forth in Section 2.3.1(6) of the original
Agreement, and (ii) the Seller waives the condition precedent to Seller's obligation to close
escrow as set forth in Section 2.3.2(4) of the original Agreement.
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF DOWNEY DOE�
HEREBY RESOLVE t •
SECTION 1. The City Council of the City of Downey hereby (i) approves the First
Amendment to the Agreement, copy of which attached hereto as Exhibit "A", and is on file with
the City Clerk, (ii) if required, authorizes and directs the City Manager to make final changes to
the Agreement consistent with the City Council's direction, and (iii) authorizes and directs the
City Manager to execute the final Agreement and any other documents and agreements
necessary to complete the sale transaction contemplated by the Agreement.
SECTION 2. The City Council of the City of Downey hereby determines that the sale of
the Property is exempt from the California Environmental Quality Act (CEQA) under Section
15301 of the CEQA Guidelines, as an existing facility.
SECTION 3. The City Clerk shall certify to the adoption of this resolution.
APPROVED AND ADOPTED this 25th day of June, 2019,
#1CDRIGUEZ, Mayor
HEREBY CERTIFY that the foregoing Resolution was adopted by the City Council of
the City of Downey at a regular meeting held on the 25th day of June, 2019, by the following
vote to wit: ;p
AYES:
Council Members:
Ashton, Frometa, Saab, Pacheco, Mayor Rodriguez
NOES:
Council Member:
None.
ABSENT:
Council Member:
None.
ABSTAIN;
Council Member:
None.
FIRST AMENDMENT TO PURCHASE AAGREEMENT.AND ESCRO
INSTRUCTIONS
This First Amendment Purchase and Sale Agreement, and Escrow Instructions ("First
Amendment") is entered into on June ;4 2019 ("Efftetive Date") by THE CITY OF DOWNEY,
a California municipal corporation ("Seller"), and DOWNEY HOSPITALITY, LLC, a
California limited liability company ("Buyer"). Buyer and Seller are hereinafter individually
referred to as a "Party" and collectively as the "Parties,"
A. On or about December 1, 2015, Buyer and Seller entered into that certain
Purchase and Sale Agreement, and Escrow Instructions ("Original Agreement"),
B. The Parties desire to modify the Original Agreement to (i) allow for the Close of
Escrow prior to the date on which Buyer will obtain all required building permits for the Project,
(ii) remove the requirement that the parties mutually agree upon a DDA prior to the Close of
Escrow, (iii) establish the Schedule of Performance, within which Buyer must obtain all
Entitlements, cornmence construction of the Project, and complete construction of the Project,
and (iv) modify and clarify the Original Agreement to allow Seller's exercise of the Purchase
Option if Buyer falls to comply with any facet of the modified Schedule of Performance as set
forth herein.
1, Defined Terms. All capitalized terrns used in this First Amendment shall have
the meaning assigned to those terms in the Original Agreement, unless specified otherwise
herein,
2. Removal of Requirement to Obtain Entitlements Prior to Close of Escrow.
The Parties agree and acknowledge that Close of Escrow shall occur prior to Buyer obtainin—P
building permits for the Project, and that building permits are part of the package of approvals
defined as "Entitlements" under the Original Agreement. Accordingly, (i) Buyer waives the
condition precedent to Buyer's obligation to close Escrow as set forth in Section 2.3.1(5) of the
Original Agreement, and (ii) the Seller waives the condition precedent to Seller's obligation to
close Escrow as set forth in Section 2.3.2(3) of the Original Agreement.
3. Agreed Schedule of Performance. Buyer and Seller mutually agree that the
Schedule of Performance shall be as follows: (i) Buyer shall obtain all required building permits
for the Pro . ect on or before Deccinber 31,',)
1 019, (ii) Buyer shall commence construction, and
call for first building inspection of the Project on or before iMarch 31, 2,021), and (ill) Buyer shall
complete construction and obtain all required certificates of occupancy for the Project on or
before Seotember 30, 202 1,. Buyer and Seller acknowledgc, agree, and understand that if Buyer
falls to comply with and facet of the Schedule of Performance, Seller shall have the right to
exercise the Purchase Option set forth in Section 5.10 of the Original Agreement, All
requirements set for(h in this Section 3 shall survive the close ofEscrow and remain in full force
and effect until the earlier of (i) the date on which Buyer obtains all necessary certificates of
occupancy for the Project, and (ii) the date on which Seller completes the repurchase of the
Property pursuant to Section 5. 10 of the Original Agreement.
4. Waiver of DDA Conditions Precedent. Buyer and Seller acknowledge and
agree that they have achieved mutual agreement on (i) the Schedule of Performance (as set forth
in Section 3 of this First Amendment, above), and (ii) on the Site Elevations and Site Design (as
set forth in the Entitlements obtained by Buyer from Seller to date). Buyer and Seller further
acknowledge and agree to waive the requirement to enter into a DDA as a condition to closing
Escrow. Accordingly, (i) Buyer waives the condition precedent to Buyer's obligation to closi-1;
Escrow as set forth in Section 2.3.1(6) of the Original Agreement, and (ii) the Seller waives the
condition precedent to Seller's obligation to close Escrow as set forth in Section 2.3.2(4) of ths
Original Agreement.
5. No Other Revisions or Modifications. Except as expressly modified in this First
Amendment, all of the terms and conditions contained in this the Original Agreement License
are ratified and confirmed and shall remain in full force and effect.
6. Counterparts. This Amendment may be executed in any number of
counterparts, each of which shall be deemed an original, but all of which, taken together, shall
constitute one and the same instrument,
THE CITY OF DOWNEY, a
California municipal corporation
By:
-7�
City katnager
WYNI =1
Rutan& Tucker, LLP
S,Jli�'C-iaf.'OLUISel to City 6T'Downey
A'ff E S T.
BY.
-1 �ARA. DUARTE, CM
CITY CLERK
DATE:
11 111•1116011111111111
W W - -• •W.• M., = §
By:
Its:
occupancy for the Project, and (ii) the date on which Seller completes the repurchase of the
Property pursuant to Section 5.10 of the Original Agreement.
Section4. Waiver of DDA Conditions Precedent. Buyer and Seller acknowledge and
agree that they have achieved mutual agreement on (i) the Schedule of Perfon-nance (as set forth
in of Amendment, ab and (ii) on the Site Elevations. • Site Designset • obtained by Buyer fromis i. Buyer and
Seller further
acknowledge and agree to waive the requirement to enter into a DDA as a condition to closing
Escrow. Accordingly, (i) Buyer waives the condition precedent to Buyer's obligation to close
Escrow as set forth in Section 2,3.1(6) of the Original Agreement,
condition precedent • Seller's obligation to close Escrow as set forthi 4 , of
Original Agreement.
5. 1 Other Revisionsor Modifications.• expressly modified in this First
Amendment, all of the terms and conditions contained in this the Original Agreement License
q,re rj,.tified and confin-ned and shall remain in full force and effect.
6. Counterparts. This Amendment may be executed in any number of
counterparts, each of which shall be deemed an original, but all of which, taken together, shall
constitute one and the same instrument.
Buyer and Seller have executed this First Amendment as of the Effective Data
THE CITY OF DOWNEY, a
California municipal corporation
By:
City Manager
"Seller"
APPROVED AS TO FORM:
Rutan& Tucker, LLP
OEY HOSPITALITY, LLC, a
California limited liability company
By: �
Its: - 1n " z - .
By:
Name:
Its: