EXHIBIT 10.1

AGREEMENT OF PURCHASE AND SALE

between

ASHFORD HOSPITALITY PRIME LIMITED PARTNERSHIP,
a Delaware limited partnership

(“Purchaser”)

and

HOTEL YOUNTVILLE, LLC a California limited liability company,
HOTEL YOUNTVILLE HOLDINGS, LLC, a California limited liability company,
ALTAMURA FAMILY, LLC, a California limited liability company, and
GEORGE ALTAMURA, JR., LLC, a California limited liability company

(collectively “Seller”)

Hotel Yountville
Yountville, California

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TABLE OF CONTENTS
Article I DEFINITIONS
1

1.1
Definitions
1

Article II PURCHASE AND SALE; DEPOSIT; PAYMENT OF PURCHASE PRICE; STUDY PERIOD
9

2.1
Purchase and Sale
9

2.2
Payment of Purchase Price
9

2.3
Deposit
9

2.4
Study Period
10

Article III SELLER’S REPRESENTATIONS AND WARRANTIES
13

3.1
Organization and Power
13

3.2
Authorization and Execution
14

3.3
Non-contravention
14

3.4
Title To Real Property
14

3.5
No Special Taxes
14

3.6
Compliance with Existing Laws
14

3.7
Personal Property
14

3.8
Operating Agreements/Off-Site Facility Agreements/Leased Property Agreements
14

3.9
Condemnation Proceedings; Roadways
15

3.10
Actions or Proceedings
15

3.11
Labor and Employment Matters
15

3.12
Financial Information and Submission Matters
15

3.13
Bankruptcy
16

3.14
Hazardous Substances
16

3.15
Sales, Use and Occupancy Taxes
16

3.16
Personal Property Taxes
16

3.17
Occupancy Agreements
16

3.18
Utilities
17

3.19
Leased Property
17

3.20
Advance Bookings
17

3.21
Americans With Disabilities Act
17

3.22
Zoning
17

3.23
Seller Is Not a “Foreign Person”
17

3.24
Patriot Act
17

3.25
No Other Property Interests
18

Article IV PURCHASER’S REPRESENTATIONS AND WARRANTIES
18

4.1
Organization and Power
19

4.2
Authorization and Execution
19

4.3
Non-contravention
19

4.4
Litigation
19

4.5
Bankruptcy
19

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4.6
Patriot Act and OFAC Compliance
19

4.7
Sophisticated Real Estate Investor
20

Article V CONDITIONS PRECEDENT
20

5.1
As to Purchaser’s Obligations
20

5.2
As to Seller’s Obligations
22

Article VI COVENANTS OF SELLER
22

6.1
Operating Agreements/Leased Property Agreements/Off-Site Facility Agreements
22

6.2
Warranties and Guaranties
22

6.3
Insurance
22

6.4
Independent Audit
23

6.5
Operation of Property Prior to Closing
23

6.6
Marketing Restriction
25

6.7
Employees and Continuation of Seller’s Group Health Plans
25

6.8
Rights of First Refusal and Options
25

6.9
Fitness Center
25

Article VII CLOSING
26

7.1
Closing
26

7.2
Seller’s Deliveries
26

7.3
Purchaser’s Deliveries
28

7.4
Mutual Deliveries
29

7.5
Closing Costs
29

7.6
Revenue and Expense Allocations
29

7.7
Acquisition and Transfer of Inventory and Personal Property
32

Article VIII GENERAL PROVISIONS
32

8.1
Condemnation
32

8.2
Risk of Loss
32

8.3
Broker
32

8.4
Bulk Sale
33

8.5
Confidentiality
33

8.6
Seller’s Accounts Receivable
34

Article IX LIABILITY OF PURCHASER; INDEMNIFICATION BY SELLER; DEFAULT;
TERMINATION RIGHTS
34

9.1
Liability of Purchaser
34

9.2
Indemnification by Seller
34

9.3
Default by Seller/Failure of Conditions Precedent
35

9.4
Default by Purchaser/Failure of Conditions Precedent
35

9.5
Costs and Attorneys’ Fees
36

9.6
Limitation of Liability
36

Article X [INTENTIONALLY DELETED]
37

Article XI MISCELLANEOUS PROVISIONS
37

11.1
Completeness; Modification
37

11.2
Assignments
37

11.3
Successors and Assigns
37

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11.4
Days
37

11.5
Governing Law
37

11.6
Counterparts
37

11.7
Severability
37

11.8
Costs
38

11.9
Notices
38

11.10
Escrow Agent
39

11.11
Incorporation by Reference
39

11.12
Survival
40

11.13
Further Assurances
40

11.14
No Partnership
40

11.15
Time of Essence
40

11.16
Signatory Exculpation
40

11.17
Rules of Construction
40

11.18
Tax-Deferred Exchange
40

11.19
Liquor Operations
41

11.20
Holdback
41

EXHIBITS
Exhibit A    -    Land
Exhibit B    -    Intentionally Deleted
Exhibit C    -    Assignment and Assumption Agreement
Exhibit D    -    Bill of Sale
Exhibit E    -    Grant Deed
Exhibit F    -    Assignment of Occupancy Agreements
Exhibit G    -    Food and Beverage Management Agreement
Exhibit H    -    Parking Agreement
Exhibit I    -    Post-Closing Holdback Escrow Agreement
Exhibit 3.6    -    Carve Outs to Representations
Exhibit 6.9A    -    Construction Contracts
Exhibit 6.9B    -    Scope of Work

SCHEDULES
Schedule 1    -    Authorizations
Schedule 2    -    Operating Agreements
Schedule 3    -    Employment Agreements
Schedule 4    -    Occupancy Agreements
Schedule 5    -    Off-Site Facility Agreements
Schedule 6    -    Restricted Employment Agreements

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AGREEMENT OF PURCHASE AND SALE
THIS AGREEMENT OF PURCHASE AND SALE (this “Agreement”) is made as of this 13th
day of January, 2017, between ASHFORD HOSPITALITY PRIME LIMITED PARTNERSHIP, a
Delaware limited partnership (“Purchaser”), and HOTEL YOUNTVILLE, LLC a
California limited liability company ("HY LLC"), HOTEL YOUNTVILLE HOLDINGS, LLC,
a California limited liability company, ("HYH LLC"), ALTAMURA FAMILY, LLC, a
California limited liability company, ("AF LLC") and GEORGE ALTAMURA, JR., LLC,
("GAJ LLC"), a California limited liability company (collectively “Seller”).

R E C I T A T I O N S:
A.    HYH LLC, AF LLC, AND GAJ LLC, (collectively "Property Owners") are the
owners of the real property more particularly described on Exhibit A attached
hereto and made a part hereof, on which are located the Hotel Yountville and
Hopper Creek Apartments (collectively “Hotel Yountville”), in Yountville,
California. HY LLC ("Hotel Owner") leases the hotel facility from Property
Owners and owns and operates the Hotel Yountville business. Property Owners are
desirous of selling the land and improvements to Purchaser, and Hotel Owner is
desirous of selling its business assets to Purchaser under this Agreement. For
convenience these two parties are referenced as Seller under this Agreement to
reflect their collective sale of all of the real property and other business
assets located on and operated from the property described in Exhibit "A".
B.    Purchaser is desirous of purchasing these assets from Seller, and Seller
is desirous of selling such assets to Purchaser, for the purchase price and upon
the terms and conditions hereinafter set forth.
NOW, THEREFORE, in consideration of premises and in consideration of the mutual
covenants, promises and undertakings of the parties hereinafter set forth, and
for other good and valuable considerations, the receipt and sufficiency of which
is hereby acknowledged by the parties, it is agreed:
Article I
DEFINITIONS
1.1    Definitions. The following terms shall have the indicated meanings:
“Act of Bankruptcy” shall mean if a party hereto or any general partner thereof
shall (a) apply for or consent to the appointment of, or the taking of
possession by, a receiver, custodian, trustee or liquidator of itself or of all
or a substantial part of its property, (b) admit in writing its inability to pay
its debts as they become due, (c) make a general assignment for the benefit of
its creditors, (d) file a voluntary petition or commence a voluntary case or
proceeding under the Federal Bankruptcy Code (as now or hereafter in effect),
(e) be adjudicated a bankrupt or insolvent, (f) file a petition seeking to take
advantage of any other law relating to bankruptcy, insolvency, reorganization,
winding-up or composition or adjustment of debts, (g) fail to controvert in a
timely and appropriate manner, or acquiesce in writing to, any petition filed
against it in an

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involuntary case or proceeding under the Federal Bankruptcy Code (as now or
hereafter in effect), or (h) take any corporate or partnership action for the
purpose of effecting any of the foregoing; or if a proceeding or case shall be
commenced, without the application or consent of a party hereto or any general
partner thereof, in any court of competent jurisdiction seeking (1) the
liquidation, reorganization, dissolution or winding-up, or the composition or
readjustment of debts, of such party or general partner, (2) the appointment of
a receiver, custodian, trustee or liquidator for such party or general partner
or all or any substantial part of its assets, or (3) other similar relief under
any law relating to bankruptcy, insolvency, reorganization, winding-up or
composition or adjustment of debts, and such proceeding or case shall continue
undismissed; or an order (including an order for relief entered in an
involuntary case under the Federal Bankruptcy Code, as now or hereafter in
effect) judgment or decree approving or ordering any of the foregoing shall be
entered and continue unstayed and in effect, for a period of sixty (60)
consecutive days.
“Additional Deposit” shall have the meaning given such term in Section 2.3
hereof.
“Advance Bookings” shall mean reservations made by Seller or its manager prior
to Closing for Hotel rooms or meeting rooms to be utilized after Closing, or for
catering services or other Hotel services to be provided after Closing, in the
ordinary course of business.
“Affiliate” of a Person shall mean (i) any other Person that is directly or
indirectly (through one or more intermediaries) controlled by, under common
control with, or controlling such Person, or (ii) any other Person in which such
Person has a direct or indirect equity interest constituting at least a majority
interest of the total equity of such other Person. For purposes of this
definition, “control” shall mean the possession, directly or indirectly, of the
power to direct or cause the direction of the management and policies of any
Person or the power to veto major policy decisions of any Person, whether
through the ownership of voting securities, by contract or otherwise.
“Affiliated Company” means any other entity which is, along with Seller and/or
Seller’s management company, a member of a controlled group of corporations or a
controlled group of trades or businesses (as defined in Section 414(b) or (c) of
the Internal Revenue Code), any entity which along with Seller and/or Seller’s
management company is included in an affiliated service group as defined in
Section 414(m) of the Internal Revenue Code, and any other entity which is
required to be aggregated with Seller and/or Seller’s management company
pursuant to Treasury Regulations under Section 414(o) of the Internal Revenue
Code.
“Aggregate Liability” means Seller’s aggregate liability for breach of all
representations, warranties and indemnities of Seller set forth in this
Agreement shall in no event exceed Four Million Dollars ($4,000,000) (the
“Liability Cap”). Notwithstanding the foregoing, the Aggregate Liability shall
not be applicable to insured third party claims, revenue and expense allocations
under Section 7.6 of this Agreement (including sales and use tax and occupancy
tax liability), any type of employee liability claims or claims under Section
8.3 of this Agreement.
“Applicable Laws” shall mean any applicable building, zoning, subdivision,
environmental, health, safety or other governmental laws, statutes, ordinances,
resolutions, rules, codes, regulations, orders or determinations of any
Governmental Authority or of any insurance

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boards of underwriters (or other body exercising similar functions), or any
restrictive covenants or deed restrictions affecting the Property or the
ownership, operation, use, maintenance or condition thereof.
“Assignment and Assumption Agreement” shall mean one or more assignment and
assumption agreements in the form attached hereto as Exhibit C whereby Seller
assigns and Purchaser and/or its property manager, lessee or other designee (as
Purchaser shall specify) assumes the Operating Agreements, Leased Property
Agreements and Off-Site Facility Agreements that have not been terminated prior
to Closing in accordance herewith.
“Assignment of Occupancy Agreements” shall mean one or more assignment
agreements in the form attached hereto as Exhibit F whereby Seller assigns and
Purchaser and/or its property manager, lessee or other designee (as Purchaser
shall specify) assumes all of Seller’s right, title and interest in and to the
Occupancy Agreements.
“Authorizations” shall mean all licenses, permits and approvals required by any
governmental or quasi-governmental agency, body, department, commission, board,
bureau, instrumentality or office, or otherwise appropriate with respect to the
construction, ownership, operation, leasing, maintenance, or use of the Property
or any part thereof.
“Bill of Sale” shall mean that certain bill of sale conveying title to the
Inventory, Tangible Personal Property and the Intangible Personal Property to
Purchaser or Purchaser’s property manager, lessee or other designee (as
Purchaser shall specify) in the form attached hereto as Exhibit D.
“Broker” shall mean Coldwell Banker Real Estate /Hotels (“CBRE/Hotels”)
“CCR Estoppel” shall have the meaning given such term in Section 5.1(h) hereof.
“Closing” shall mean the Closing of the purchase and sale of the Property
pursuant to this Agreement and shall be deemed to occur on the Closing Date.
“Closing Date” shall mean the date on which the Closing occurs.
“Closing Documents” shall mean the documents defined as such in Section 7.1
hereof.
“COBRA” shall have the meaning given such term in Section 6.7 hereof.
“Covenants, Conditions and Restrictions” shall mean those covenants, conditions
and/or restrictions binding, restricting or benefiting the Property which are
set forth in the Title Commitment.
“Deed” shall mean that certain deed conveying title to the Real Property with
special warranty covenants of title from Seller to Purchaser or Purchaser’s
designee, and subject only to Permitted Title Exceptions, in the form attached
hereto as Exhibit E. If there is any difference between the description of the
Land, as shown on Exhibit A attached hereto and the description of

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the Land as shown on the Survey, the description of the Land to be contained in
the Deed shall be the description in Seller’s vesting deed and Seller shall
deliver to Purchaser a quitclaim deed with a legal description conforming to the
description shown on the Survey.
“Deposit” shall mean all amounts deposited from time to time with Escrow Agent
by Purchaser pursuant to Section 2.3 hereof, plus all interest or other earnings
that may accrue thereon. All cash Deposits shall be invested by Escrow Agent in
a commercial bank or banks acceptable to Purchaser at money market rates, or in
such other investments as shall be approved in writing by Seller and Purchaser.
The Deposit shall be held and disbursed by Escrow Agent in strict accordance
with the terms and provisions of this Agreement.
“Effective Date” shall have the meaning given such term in Section 11.17(e)
hereof.
“Employment Agreements” shall mean all employment agreements, written or oral,
between Seller and the persons employed with respect to the Property.
“Environmental Damages” shall mean all third-party claims, judgments, damages,
losses, penalties, fines, liabilities (including, without limitation, punitive
damages and strict liability), encumbrances, liens, costs and expenses of
investigation and defense of any claim, whether or not such is ultimately
defeated, and of any settlement or judgment, of whatever kind or nature,
contingent or otherwise, matured or unmatured, including, without limitation,
attorneys’ fees and disbursements and consultants’ fees, any of which arise as a
result of the existence of Hazardous Materials upon, about or beneath the
Property or migrating or threatening to migrate from the Property, or as a
result of the existence of a violation of Environmental Requirements pertaining
to the Property.
“Environmental Requirements” shall mean (i) all applicable statutes,
regulations, rules, policies, ordinances, codes, licenses, permits, orders,
approvals, plans, authorizations, and similar items, of all Governmental
Authorities, and (ii) all judicial, administrative and regulatory decrees,
judgments and orders, in each case of (i) and (ii) relating to the protection of
human health or the environment from Hazardous Materials, including, without
limitation: (a) all requirements thereof, including, without limitation, those
pertaining to reporting, licensing, permitting, investigation and remediation of
emissions, discharges, releases or threatened releases of Hazardous Materials
into the air, surface water, groundwater or land, or relating to the
manufacture, processing, distribution, use, treatment, storage, disposal,
transport or handling of Hazardous Materials; and (b) all requirements
pertaining to the protection of the health and safety of employees or the public
from Hazardous Materials.
“Escrow Agent” shall mean Chicago Title Insurance Company, 711 Third Avenue,
5th Floor, New York, New York 10017, Attn: Siu Cheung.
“Financial Information” shall mean the financial information defined as such in
Section 3.13 hereof.
“FIRPTA Certificate” shall mean the affidavit of Seller under Section 1445 of
the Internal Revenue Code, as amended, certifying that Seller is not a foreign
corporation, foreign

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partnership, foreign trust, foreign estate or foreign person (as those terms are
defined in the Internal Revenue Code and regulations promulgated thereunder), in
form and substance satisfactory to Purchaser.
“Governmental Authority” shall mean any federal, state, county, municipal or
other government or any governmental or quasi-governmental agency, department,
commission, board, bureau, office or instrumentality, foreign or domestic, or
any of them.
“Hazardous Materials” shall mean any chemical substance: (i) which is or becomes
defined as a “hazardous substance,” “hazardous waste,” “hazardous material,”
“pollutant,” “contaminant,” or “toxic,” “explosive,” “corrosive,” “flammable,”
“infectious,” “radioactive,” “carcinogenic,” or “mutagenic” material under any
law, regulation, rule, order, or other authority of the federal, state or local
governments, or any agency, department, commission, board, or instrumentality
thereof, regarding the protection of human health or the environment from such
chemical substances including, but not limited to, the following federal laws
and their amendments, analogous state and local laws, and any regulations
promulgated thereunder: the Clean Air Act, the Clean Water Act, the Oil
Pollution Control Act, the Comprehensive Environmental Response, Compensation,
and Liability Act of 1986, the Emergency Planning and Community Right to Know
Act, the Solid Waste Disposal Act, the Resource Conservation and Recovery Act,
the Safe Drinking Water Act, the Federal Insecticide, Fungicide and Rodenticide
Act, and the Toxic Substances Control Act, including, without limitation,
asbestos and gasoline and other petroleum products (including crude oil or any
fraction thereof); (ii) without limitation, which contains gasoline, diesel fuel
or other petroleum hydrocarbons; (iii) without limitation, which contains
drinking biphenyls or asbestos or asbestos-containing materials or urea
formaldehyde foam insulation; or (iv) without limitation, radon gas.
“Holdback Amount” shall mean Four Million and No/100 Dollars ($4,000,000.00).
“Hopper Creek Apartments” means the workforce housing project and related
amenities located on the Land.
“Hotel” shall mean the hotel and related amenities located on the Land.
“Improvements” shall mean the Hotel, Hopper Creek Apartments, and all other
buildings, improvements, fixtures and other items of real estate located on the
Land.
“Initial Deposit” shall have the meaning given such term in Section 2.3 hereof.
“Insurance Policies” shall mean all policies of insurance maintained by or on
behalf of Seller pertaining to the Property, its operation, or any part thereof.
“Intangible Personal Property” shall mean all intangible personal property owned
or possessed by Seller and used in connection with the ownership, operation,
leasing, occupancy or maintenance of the Property, including, without
limitation, (1) the transferable Authorizations, (2) telephone numbers, TWX
numbers, post office boxes, Warranties and Guaranties, signage rights, utility
and development rights and privileges, general intangibles, business records,
site plans,

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surveys, environmental and other physical reports, plans and specifications
pertaining to the Real Property and the Personal Property, (3) any unpaid award
for taking by condemnation or any damage to the Land by reason of a change of
grade or location of or access to any street or highway, (4) the share of the
Rooms Ledger determined under Section 7.6 hereof, and (5) all websites and
domains used for the Hotel, including access to the FTP files of the websites to
obtain website information and content pertaining to the Hotel, excluding
(a) any of the aforesaid rights Purchaser elects not to acquire,
(b) [Intentionally Deleted] and (c) accounts receivable except for the above
described share of the Rooms Ledger.
“Inventory” shall mean all tangible personal property described in Section 7.7
hereof.
“Land” shall mean those certain parcels of real estate more particularly
described on Exhibit A attached hereto, together with all easements, rights,
privileges, remainders, reversions and appurtenances thereunto belonging or in
any way appertaining, and all of the estate, right, title, interest, claim or
demand whatsoever of Seller therein, in the streets and ways adjacent thereto
and in the beds thereof, either at law or in equity, in possession or
expectancy, now or hereafter acquired.
“Leased Property” shall mean all leased items of Tangible Personal Property.
“Leased Property Agreements” shall mean the lease agreements pertaining to the
Leased Property.
"Liquidated Damages" shall have the meaning given such term in Section 9.4
hereof.
“Occupancy Agreements” shall mean all rental or occupancy agreements for the
residents of the Hopper Creek Apartments, and not including Hotel guests.
“Off-Site Facility Agreements” shall mean those easements, leases, contracts and
agreements pertaining to facilities not located on the Property but which
Purchaser deems necessary, beneficial or related to the operation of the Hotel
including, without limitation, the use agreements for local golf courses,
parking contracts or leases, garage contracts or leases, skybridge easements,
tunnel easements, utility easements, and storm water management agreements.
“Operating Agreements” shall mean all service, supply and maintenance contracts,
if any, in effect with respect to the Property and all other contracts (other
than the Occupancy Agreements, Off-Site Facility Agreements and the Employment
Agreements) that affect the Property or are otherwise related to the
construction, ownership, operation, occupancy or maintenance of the Property.
“Owner’s Title Policy” shall mean an owner’s policy of title insurance issued to
Purchaser by the Title Company, pursuant to which the Title Company insures
Purchaser’s ownership of fee simple title to the Real Property (including the
marketability thereof) subject only to Permitted Title Exceptions. The Owner’s
Title Policy shall insure Purchaser in the amount of the Purchase Price and
shall be acceptable in form and substance to Purchaser. Purchaser may require
such

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deletions of standard exceptions and such title endorsements as are legally
available and customarily required by institutional investors purchasing
property comparable to the Property in the State where the Property is situated.
The description of the Land in the Owner’s Title Policy shall be by courses and
distances or by reference to a legal, subdivided lot and shall be identical to
the description shown on the Survey.
“Parking Agreement” shall mean the unsigned agreement attached hereto as Exhibit
H.
“Permitted Title Exceptions” shall mean those exceptions to title to the Real
Property that are satisfactory to Purchaser as determined pursuant to
Section 2.4(d) hereof.
“Person” shall mean an individual, a partnership, a limited liability company, a
corporation, an association, a joint stock company, a trust, a joint venture, an
unincorporated organization, or a Governmental Authority.
“Personal Property” shall mean collectively the Tangible Personal Property and
the Intangible Personal Property, but shall not include any property located on
the Property which is owned by Seller’s property manager.
“Post-Closing Escrow Agreement” shall mean the agreement in the form attached
hereto as Exhibit I.
“Property” shall mean collectively the Real Property, the Inventory, the
Tangible Personal Property and the Intangible Personal Property.
“Purchase Price” shall mean $96,500,000.00 payable in the manner described in
Section 2.2 hereof.
“Purchaser’s Objections” shall mean the objections defined as such in
Section 2.4(d) hereof.
“Real Property” shall collectively mean the Land and the Improvements.
“REIT” shall have the meaning given such term in Section 8.5 hereof.
“Rooms Ledger” shall mean the final night’s room revenue (revenue from rooms
occupied as of 6:00 a.m. on the Closing Date, exclusive of food, beverage,
telephone and similar charges which shall be retained by Seller), including any
sales taxes, room taxes or other taxes thereon.
“Seller’s Submittals” shall have the meaning ascribed to such term in Section
2.4(b).
“Study Period” shall mean the period commencing on the Effective Date and
continuing through the date that is forty-five (45) days thereafter; provided,
however, Purchaser shall have the option to shorten the Study Period. Except as
expressly noted herein to the contrary,

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time periods herein referred to shall mean the time periods as in effect, from
time to time, at Yountville, California.
“Submission Matters” shall mean all items Seller is required to deliver to
Purchaser pursuant to Section 2.4(b) hereof.
“Survey” shall mean the survey defined as such in and prepared pursuant to
Section 2.4(d) hereof.
“Survival Period” shall have the meaning ascribed to such term in Article III.
“Tangible Personal Property” shall mean the items of tangible personal property
consisting of all furniture, fixtures, equipment, machinery, Inventory and other
personal property of every kind and nature (excluding cash-on-hand and petty
cash funds) located on or used or useful in the operation of the Hotel and owned
by Seller, including, without limitation, Seller’s interest as lessee with
respect to any such Tangible Personal Property; provided, however, excluded from
the Tangible Personal Property are (a) a 2002 Ford F450 pickup; (b) a 2015
Nissan Rogue; and (c) three (3) dump trailers.
“Tenant Estoppels” shall have the meaning given such term in Section 5.1(j)
hereof.
“Third Party Consents” shall have the meaning given such term in Section 5.1(i)
hereof.
“Title Commitment” shall mean the title commitment and exception documents
defined as such in Section 2.4(d) hereof.
“Title Company” shall mean Escrow Agent on behalf of Chicago Title Insurance
Company or other title insurance underwriter selected by Purchaser.
“UCC Reports” shall mean the reports defined as such in Section 2.4(d) hereof.
“Utilities” shall mean public sanitary and storm sewers, natural gas, telephone,
public water facilities, electrical facilities and all other utility facilities
and services necessary or appropriate for the operation and occupancy of the
Property as a hotel.
“Warranties and Guaranties” shall mean all warranties and guaranties relating to
the Improvements or the Tangible Personal Property or any part thereof.

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ARTICLE II
PURCHASE AND SALE; DEPOSIT; PAYMENT
OF PURCHASE PRICE; STUDY PERIOD
2.1    Purchase and Sale. Seller agrees to sell and Purchaser agrees to purchase
the Property for the Purchase Price and in accordance with and subject to the
other terms and conditions set forth herein.
2.2    Payment of Purchase Price. The Purchase Price shall be paid to Seller in
the following manner:
(a)    Purchaser shall receive a credit against the Purchase Price in an amount
equal to the amount of the Deposit.
(b)    Purchaser shall pay the balance of the Purchase Price, as adjusted in the
manner specified in Article VII and as set forth below, to Seller or other
applicable party at Closing by making a wire transfer of immediately available
federal funds to the account of Seller or other applicable party as specified in
writing by Seller.
(c)    The portion of the Purchase Price allocated to the Real Property shall be
$92,640,000 and the balance of the Purchase Price shall be allocated Personal
Property, including tangible and intangible personal property. Allocations made
pursuant to this Section shall be used by the Parties for title insurance and
all tax and other government reporting purposes. In no event shall the Purchase
Price be adjusted as a result of any allocation thereof to the liquor license.
2.3    Deposit. Within two (2) business days after the execution hereof by both
Seller and Purchaser and as a condition precedent to the effectiveness of this
Agreement, Purchaser shall deliver to Escrow Agent (i) a wire transfer or check
in the sum of Fifty Dollars ($50.00) payable to the order of Seller representing
the independent consideration for Seller’s execution of this Agreement and
agreement to provide Purchaser with the Study Period (which check or the
proceeds of which wire transfer shall thereafter be delivered by Escrow Agent to
Seller) and (ii) a wire transfer or check in the sum of Two Million and No/100
Dollars ($2,000,000.00) (the “Initial Deposit”), the proceeds of which wire
transfer or check Escrow Agent shall deposit and invest in an interest bearing
account at a financial institution acceptable to Purchaser or as otherwise
agreed to in writing by Seller and Purchaser. Within two (2) days after the
expiration of the Study Period, if this Agreement has not been sooner
terminated, Purchaser shall deposit with Escrow Agent, by wire transfer an
additional deposit in the amount of Two Million and No/100 Dollars
($2,000,000.00) (the “Additional Deposit”). The Initial Deposit and the
Additional Deposit (when it is deposited by Purchaser with Escrow Agent) are
collectively and individually referred to herein as the “Deposit”. Escrow Agent
shall hold and invest the Deposit pursuant to the terms, conditions and
provisions of this Agreement. All accrued interest on the Deposit shall become
part of the Deposit. The Deposit shall be returned to Purchaser if Purchaser
fails, prior to the end of the Study Period, to notify Seller in writing,
pursuant to Section 2.4 hereof, that Purchaser is not electing to terminate this
Agreement. The Deposit shall be either (a) applied at the Closing against the
Purchase Price, (b) returned to Purchaser pursuant hereto, or (c) paid to Seller
pursuant hereto. If Purchaser does not terminate this Agreement prior to the
expiration of the Study Period, the Deposit shall be non-refundable to

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Purchaser, except as otherwise provided in this Agreement. For purposes of
reporting earned interest with respect to the Deposit, Purchaser’s Federal Tax
Identification Number is 46-2473800, and Seller’s Federal Tax Identification
Numbers are: ____________________________________________.
2.4    Study Period.
(a)    Purchaser and Purchaser’s potential lessee or manager shall have the
right, until 5:00 p.m., Yountville, California time on the last day of the Study
Period, and thereafter if Purchaser notifies Seller in writing prior to the
expiration of the Study Period that Purchaser has elected not to terminate this
Agreement, to enter upon the Real Property upon one (1) business day notice to
Seller and to perform, at Purchaser’s expense, such economic, surveying,
engineering, topographic, environmental, marketing and other tests, studies and
investigations as Purchaser and Purchaser’s potential lessee may deem
appropriate. Purchaser and Purchaser’s agents shall conduct such investigations
in a manner which, to the greatest reasonable extent, does not materially impair
the operation of the Hotel or the Hopper Creek Apartments; provided, however, in
no event shall Purchaser undertake any invasive testing of any of the
Improvements or the Land without Seller’s prior written consent (a Phase I
environmental study shall not be considered invasive). If such tests, studies
and investigations warrant, in Purchaser’s sole, absolute and unreviewable
discretion, the purchase of the Property for the purposes contemplated by
Purchaser, then Purchaser may elect to proceed with this transaction and shall
notify Seller and Escrow Agent, in writing prior to the expiration of the Study
Period, that Purchaser has elected not to terminate this Agreement. If for any
reason whatsoever Purchaser does not so notify Seller and Escrow Agent of its
determination not to terminate this Agreement prior to the expiration of the
Study Period, or if Purchaser notifies Seller and Escrow Agent in writing prior
to the expiration of the Study Period that it has determined in its sole,
absolute and unreviewable discretion, to terminate this Agreement, this
Agreement automatically shall terminate, the Deposit shall be promptly returned
to Purchaser and Purchaser and Seller shall be released from all further
liability or obligation hereunder except those which expressly survive a
termination of this Agreement.
(b)    Within twenty (20) days after the Effective Date, Seller shall (i)
deliver the following to Purchaser to the extent they exist and are in Seller’s
possession or readily available to Seller (“Seller’s Submittals”) and (ii)
complete Schedules 1-6 of the Agreement:
(1)    Copies of all Operating Agreements, Leased Property Agreements, Off-Site
Facility Agreements and Occupancy Agreements, if any, in effect as of the date
of this Agreement.
(2)    To the extent in Seller’s possession or reasonably available to Seller,
copies of all Authorizations including, without limitation, all certificates of
occupancy, permits, authorizations, approvals, licenses issued by Governmental
Authorities having jurisdiction over the Property and copies of all certificates
issued by the local board of fire underwriters (or other body exercising similar
functions) relating to the Property.
(3)    A complete list of Advance Bookings.

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(4)    A schedule indicating all pertinent information with respect to each
Employment Agreement in effect as of the date hereof (including name of
employee, social security number, wage or salary, accrued vacation benefits,
other fringe benefits, etc.) and copies of all such Employment Agreements.
(5)    To the extent in Seller’s possession or reasonably available to Seller, a
schedule setting forth the type and amounts of insurance coverage maintained by
Seller with respect to the Property as of the date of this Agreement and
complete copies of all loss history reports.
(6)    The monthly and annual financial and operating statements for the
Property for the current calendar year (including audited statements, if
available), and, to the extent in Seller’s possession or reasonably available to
Seller, for the previous three (3) calendar years.
(7)    The operating and capital expenditure budget for the Property for the
current calendar year and, to the extent in Seller’s possession or reasonably
available to Seller, for the previous three (3) calendar years.
(8)    To the extent in Seller’s possession or reasonably available to Seller,
copies of receipts for all personal property taxes and ad valorem taxes and
special assessments assessed against the Property for the current calendar year
and prior three calendar years, statements for Utilities payable for the current
calendar year and prior calendar year, and any information in Seller’s
possession or reasonably available to Seller regarding current renditions or
assessments on the Property or notices relative to change in valuation for ad
valorem taxes.
(9)    Complete copies of all Warranties and Guaranties in affect as of the date
hereof.
(10)    Copies of all soil tests, structural engineering tests, masonry tests,
percolation tests, water, oil, gas, mineral, radon, formaldehyde, PCB or other
environmental tests, audits or reports, market studies and site plans related to
the Property in Seller’s possession or reasonably available to Seller.
(11)    Parking, structural, mechanical or other engineering reports or studies
related to the Property, if any, in Seller’s possession or reasonably available
to Seller.
(12)    If in Seller’s possession or reasonably available to Seller, copies of
any title insurance policies covering the Real Property and any surveys of all
or any portion of the Property.
(13)    If in Seller’s possession or reasonably available to Seller, copies of
any and all health inspection reports with respect to the Property
(14)    Photos of the Property in Seller’s possession or reasonably available to
Seller.
(15)    A complete list of all prepaid expenses with respect to the Property.

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(16)    A schedule of pending litigation affecting the Property, if any.
(17)    An employee census listing the name, date of hire, date of last pay
increase, department, title and rate of pay with respect to each employee at the
Property, a payroll run, copies of all pension documents and a schedule of
liabilities therefor and copies of all union and collective bargaining
agreements affecting the Property.
(18)    A schedule setting forth the occupancy and average rates for the
Property on a monthly basis for the previous three (3) calendar years and the
year to date.
During the Study Period and thereafter until the Closing, Seller shall make
available to Purchaser, its agents, auditors, engineers, attorneys, potential
lessees and other designees, for inspection and/or copying, copies of all
existing architectural and engineering studies, surveys, title insurance
policies, zoning and site plan materials, correspondence, environmental audits
and reviews, books, records, tax returns, bank statements, financial statements,
advance reservations and room bookings and function bookings, rate schedules and
any and all other materials or information relating to the Property which are
in, or come into, Seller’s possession or control or are otherwise reasonably
available to Seller.
(c)    Prior to Purchaser’s entry onto the Land or Improvements, Purchaser shall
deliver to Seller an insurance policy naming Seller as an additional insured,
providing for a minimum of Three Million Dollars ($3,000,000) combined single
limit liability coverage and shall maintain such policy in force until
termination of the Agreement or Closing. Purchaser shall indemnify and defend
Seller against any loss, damage or claim for personal injury or property damage
arising out of or relating to acts or omissions upon the Real Property by
Purchaser or any agents, contractors or employees of Purchaser, unless arising
from the negligent or willful acts of Seller or any of its agents, contractors
or employees. Purchaser, at its own expense, shall restore any damage to the
Property caused by any of the tests or studies made by Purchaser. This provision
shall survive any termination of this Agreement and a closing of the transaction
contemplated hereby. Purchaser’s indemnification obligation are not limited by
the Liquidated Damages (defined below) applicable under this Agreement nor by
the amount of insurance maintained by Purchaser.
(d)    Within five (5) business days following the Effective Date, Seller shall
deliver to Purchaser a copy of any survey of the Property in Seller’s
possession. Within two (2) business days after receipt of Seller’s survey of the
Property, Purchaser shall order an update to the survey, or shall obtain its own
survey of the Property if no such survey exists (the “Survey”). Within two (2)
business days following the Effective Date, Purchaser shall order from the Title
Company to furnish to Purchaser, at Purchaser’s sole cost and expense, (i) a
title insurance commitment bearing an effective date subsequent to the date of
this Agreement issued by the Title Company covering the Real Property, binding
the Title Company to issue its standard ALTA Owner’s Policy of Title Insurance
(without a creditors’ rights exception), in form approved for use in California
in favor of Purchaser, showing title to be held currently by Seller in a good,
marketable and insurable condition, together with legible copies of all
documents identified in such title insurance commitment as exceptions to title
certified as true and complete by the Title Company (collectively, the “Title
Commitment”), and (ii) reports of searches of the Uniform Commercial Code
records of Napa County and California (collectively, the “UCC Reports”). Prior
to the expiration of the Study

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Period, Purchaser shall notify Seller of any matters shown on the Survey or
identified in the Title Commitment or the UCC Reports that Purchaser is
unwilling to accept (collectively, “Purchaser’s Objections”). If any of
Purchaser’s Objections consist of delinquent taxes, mortgages, deeds of trust,
security agreements, construction or mechanics’ liens, tax liens or other liens
or charges in a fixed sum or capable of computation as a fixed sum, then, to
that extent, notwithstanding anything herein to the contrary, Seller shall be
obligated to pay and discharge (or bond against in a manner sufficient to cause
the Title Company to insure over such Purchaser’s Objections) any such
Purchaser’s Objections at Closing, and Escrow Agent is authorized to pay and
discharge at Closing such Purchaser’s Objections to the extent not paid and
discharged or bonded against at Closing. For such purposes, Seller may use all
or a portion of the cash to close. Seller shall not be obligated to incur any
expenses to cure any non-monetary Purchaser’s Objections unless Seller agrees to
cure such non-monetary Purchaser’s Objections as hereinafter provided; provided,
however, Seller may withdraw its agreement to cure any such non-monetary
Purchaser Objections up to five days prior to Closing. Seller shall notify
Purchaser within five (5) days after receipt of notice of Purchaser’s Objections
whether Seller agrees to cure such non-monetary Purchaser’s Objections, subject
to Seller’s right to timely withdraw such agreement to cure. If Seller notifies
Purchaser in writing within such five (5) day period that Seller agrees to cure
such non-monetary Purchaser’s Objections, Seller shall correct such non-monetary
Purchaser’s Objections on or before the Closing Date to the reasonable
satisfaction of Purchaser. If Seller does not notify Purchaser within such five
(5) day period of Seller’s agreement to cure such non-monetary Purchaser’s
Objections, or if Seller timely withdraws its agreement to cure such matters,
Seller shall be deemed to have elected not to cure such non-monetary Purchaser’s
Objections, and Purchaser shall elect (1) to waive such non-monetary Purchaser’s
Objections without any abatement in the Purchase Price or (2) to terminate this
Agreement, in which case the Deposit shall be promptly returned to Purchaser and
the parties hereto shall be released from all further obligations hereunder
except those which expressly survive a termination of this Agreement. Seller
shall not, after the date of this Agreement, subject the Real Property to or
permit or suffer to exist any liens, encumbrances, covenants, conditions,
restrictions, easements or other title matters or seek any zoning changes or
take any other action which may affect or modify the status of title without
Purchaser’s prior written consent. All title matters revealed by the Title
Commitment, UCC Reports and Survey and not objected to by Purchaser as provided
above (other than those rendering title defeasible and delinquent taxes,
mortgages, deeds of trust, security agreements and other liens and charges that
are to be paid at Closing as provided above) shall be deemed Permitted Title
Exceptions. Notwithstanding the foregoing, Purchaser shall not be required to
take title to the Real Property subject to any matters which may arise
subsequent to the effective date of the Title Commitment, UCC Reports and Survey
examined by Purchaser during the Study Period.
ARTICLE III
SELLER’S REPRESENTATIONS AND WARRANTIES
Purchaser shall be purchasing the Property on an “AS IS” and “WHERE IS” basis,
subject solely to Seller’s representations and warranties expressly contained in
this Agreement. Subject to the foregoing, Seller hereby makes the following
representations and warranties with respect to the Property, on which Purchaser
is entitled to rely and has relied, except for matters discovered by Purchaser
prior to Closing which establish that such reliance is not reasonable:

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3.1    Organization and Power. Seller is a limited liability company, validly
existing and in good standing under the laws of the State of California and has
all requisite powers and all governmental licenses, authorizations, consents and
approvals to carry on its business as now conducted and to enter into and
perform its obligations hereunder and under any document or instrument required
to be executed and delivered on behalf of Seller hereunder.
3.2    Authorization and Execution. This Agreement has been duly authorized by
all necessary action on the part of Seller, has been duly executed and delivered
by Seller, constitutes the valid and binding agreement of Seller and is
enforceable in accordance with its terms. There is no other person or entity who
has an ownership interest in the Property or whose consent is required in
connection with Seller’s performance of its obligations hereunder. The person
executing this Agreement on behalf of Seller has the authority to do so.
3.3    Non-contravention. The execution and delivery of, and the performance by
Seller of its obligations under, this Agreement do not and will not contravene,
or constitute a default under, any provision of Applicable Law or regulation,
Seller’s organizational documents, or any agreement, judgment, injunction,
order, decree or other instrument binding upon Seller or to which the Property
is subject, or result in the creation of any lien or other encumbrance on any
asset of Seller. There are no outstanding agreements (written or oral) pursuant
to which Seller (or any predecessor to or representative of Seller) has agreed
to sell or has granted an option or right of first refusal to purchase the
Property or any part thereof.
3.4    Title To Real Property. Seller is the sole owner of fee simple absolute
title to the Real Property as shown on Exhibit A attached hereto, subject only
to the Permitted Exceptions.
3.5    No Special Taxes. Seller has no knowledge of, nor has it received any
notice of, any special taxes or assessments relating to the Property or any part
thereof or any planned public improvements that may result in a special tax or
assessment against the Property.
3.6    Compliance with Existing Laws. To Seller’s knowledge, Seller possesses
all Authorizations, each of which is valid and in full force and effect, and no
provision, condition or limitation of any of the Authorizations has been
breached or violated, subject however, to Exhibit 3.6 attached. Subject to
Exhibit 3.6, Seller has no knowledge, nor has it received notice within the past
three (3) years, of any existing or threatened violation of any provision of any
Applicable Laws including, but not limited to, those of environmental agencies
or insurance boards of underwriters with respect to the ownership, operation,
use, maintenance or condition of the Property or any part thereof, or requiring
any repairs or alterations to the Property other than those that have been made
prior to the date hereof. Seller has not received written notice within the past
three (3) years, of any existing or threatened violation of any restrictive
covenants or deed restrictions affecting the Property which have not been
remedied.
3.7    Personal Property. All of the Personal Property being conveyed by Seller
hereunder are free and clear of all liens and encumbrances except for those
which will be discharged by Seller at Closing, and Seller has good and
merchantable title thereto and the right to convey same in accordance with the
terms of this Agreement.

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3.8    Operating Agreements/Off-Site Facility Agreements/Leased Property
Agreements. There are no management, service, supply or maintenance contracts in
effect with respect to the Property other than the Operating Agreements, Leased
Property Agreements and Off-Site Facility Agreements. Schedule 2 is a complete
list of the Operating Agreements and Leased Property Agreements, and Schedule 5
is a complete list of the Off-Site Facility Agreements. To Seller’s knowledge,
Seller has performed all of its obligations under each of the Operating
Agreements, Leased Property Agreements and Off-Site Facility Agreements and no
fact or circumstance has occurred which, by itself or with the passage of time
or the giving of notice or both, would constitute a default under any of the
Operating Agreements, Leased Property Agreements or Off-Site Facility
Agreements. To Seller’s knowledge, all other parties to the Operating
Agreements, Leased Property Agreements and Off-Site Facility Agreements have
performed all of their obligations thereunder in all material respects, and are
not in default thereunder in any material respect. Seller has received no notice
of any intention by any of the parties to the Operating Agreements, Leased
Property Agreements or Off-Site Facility Agreements to cancel the same, nor has
Seller canceled any of same.
3.9    Condemnation Proceedings; Roadways. Seller has received no notice of any
condemnation or eminent domain proceeding pending or threatened against the
Property or any part thereof. Seller has no knowledge of any change or proposed
change in the route, grade or width of, or otherwise affecting, any street,
creek or road adjacent to or serving the Real Property.
3.10    Actions or Proceedings. There is no action, suit or proceeding pending
or known to Seller to be threatened against or affecting Seller or the Property
in any court, before any arbitrator or before or by any Governmental Authority
which (a) could materially and adversely affect the business, financial position
or results of operations of Seller or the Property, (b) could materially and
adversely affect the ability of Seller to perform its obligations hereunder, or
under any document to be delivered pursuant hereto, (c) could create a lien on
the Property, any part thereof or any interest therein, (d) concerns any past or
present employee of Seller or its managing agent or (e) could otherwise
adversely affect the Property, any part thereof or any interest therein or the
use, operation, condition or occupancy thereof.
3.11    Labor and Employment Matters. To Seller’s knowledge, Seller is not a
party to any oral or written employment contracts or agreements with respect to
the Property other than the Employment Agreements. Schedule 3 is a complete list
of the particulars of the oral agreements with its employees, which for the
purposes of this Agreement constitute the Employment Agreements. To Seller’s
knowledge, Seller is not in default under any Employment Agreement. To Seller’s
knowledge, there are no labor disputes or organizing activities pending or
threatened as to the operation or maintenance of the Property or any part
thereof. Seller is not a party to any union or other collective bargaining
agreement with employees employed in connection with the ownership, operation or
maintenance of the Property. To Seller’s knowledge, the Property has been
operated in such a way as to comply with all applicable labor and employment
laws, including, but not limited to, laws related to equal employment, plant
closings, employment taxes and withholding requirements.

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3.12    Financial Information and Submission Matters. To Seller’s knowledge, all
of Seller’s financial information, including, without limitation, all books and
records and financial statements (“Financial Information”) is correct and
complete in all material respects and presents accurately the results of the
operations of the Property for the periods indicated. Since the date of the last
financial statement included in Seller’s Financial Information, there has not
been, to Seller’s knowledge, any material adverse change in the financial
condition or in the operations of the Property. Neither Purchaser nor
Purchaser’s lessee or its management company shall have any liability under any
pension, profit sharing or welfare benefit plan that Seller may have established
with respect to the Property or their or its employees. To Seller’s knowledge,
all such pension, profit sharing and welfare benefit plans have been fully
funded and administered in accordance with Applicable Laws and regulations. To
Seller’s knowledge, the Submission Matters delivered to Purchaser are true,
accurate and complete copies thereof in Seller’s possession or reasonably
available to Seller and that those Submission Matters that have been prepared by
Seller are true, accurate and complete in all material respects.
3.13    Bankruptcy. No Act of Bankruptcy has occurred with respect to Seller.
3.14    Hazardous Substances. To Seller’s knowledge, Seller has not engaged in
or permitted any operations or activities upon, or any use or occupancy of the
Property or any portion thereof, for the purpose of or in any way involving the
handling, manufacture, treatment, storage, use, generation, release, discharge,
refining, dumping or disposal of any Hazardous Materials on, under, in or about
the Property in violation of any Applicable Laws during Seller’s ownership. To
Seller’s knowledge, no Hazardous Materials have migrated from or to the Property
upon, about, or beneath other properties in violation of any Environmental
Requirements. To Seller’s knowledge, during Seller’s ownership the Property has
not failed to materially comply with Environmental Requirements. To Seller’s
knowledge, Seller has not received any written notice concerning any alleged
violation of Environmental Requirements in connection with the Property or any
liability for Environmental Damages in connection with the Property for which
Seller (or Purchaser after Closing) may be liable. To Seller’s knowledge, there
exists no writ, injunction, decree, order or judgment outstanding, nor any
lawsuit, claim, proceeding, citation, summons or investigation, pending or
threatened, relating to any alleged violation of Environmental Requirements on
the Property, or from the suspected presence of Hazardous Materials thereon, or
relating to any Environmental Damages. To Seller’s knowledge, no underground or
above ground chemical treatment or storage tanks, or gas or oil wells are
located on the Property.
3.15    Sales, Use and Occupancy Taxes. All sales, use and occupancy taxes due
from Seller and owing with respect to the Property have been paid.
3.16    Personal Property Taxes. All ad valorem personal property taxes due and
owing with respect to the Property have been paid.
3.17    Occupancy Agreements. There are no leases, concessions or occupancy
agreements in effect with respect to the Real Property, including the Hotel,
other than the Occupancy Agreements. A complete list of the Occupancy Agreements
(including particulars of two that are oral agreements) is attached hereto as
Schedule 4. Except as specifically provided in the Occupancy Agreements, no
tenant or concessionaire is entitled to any rebates, allowances, free rent or
rent

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abatement for any period after the Closing of the transaction contemplated
hereby except for an apartment at the Hopper Creek Apartments occupied by Janet
Swan who is entitled to free rent until replacement housing will be provided to
her by Seller at another location within one year after Closing. To the extent
that any of the Occupancy Agreements call for security, such security remains on
deposit with Seller, and has not been applied towards any payment due under said
Occupancy Agreements. Seller has not received any advance rent or advance
compensation under any of said Occupancy Agreements in excess of one month. No
brokerage commissions or compensation of any kind shall be due in connection
with the Occupancy Agreements, and the rents or revenues to be derived
therefrom. To Seller’s knowledge, no party is in default under any Occupancy
Agreement. To Seller’s knowledge, Seller has performed all obligations required
of it under all of the Occupancy Agreements and there remain no unfulfilled
obligations of Seller under the Occupancy Agreements. No tenant has given notice
to Seller of its intention to institute litigation with respect to any Occupancy
Agreement.
3.18    Utilities. To Seller’s knowledge, all Utilities required for the
operation of the Property either enter the Property through adjoining streets,
or they pass through adjoining land, do so in accordance with valid public
easements or irrevocable private easements, and all of said Utilities are
installed and operating and all installation and connection charges therefor
have been paid in full.
3.19    Leased Property. To Seller’s knowledge, all leases of the Leased
Property are in good standing and free from default.
3.20    Advance Bookings. To Seller’s knowledge, the Advance Bookings are true
and correct in all material respects.
3.21    Americans With Disabilities Act. To Seller’s knowledge, the Property is
in compliance with the Americans With Disabilities Act.
3.22    Zoning. To Seller’s knowledge, the present zoning of the Property
permits the current use thereof without special variances. Seller has no
knowledge of any fact, proceeding or threatened action or proceeding which could
result in a modification or termination of the present zoning of the Property.
3.23    Seller Is Not a “Foreign Person”. Seller is not a “foreign person”
within the meaning of Section 1445 of the Internal Revenue Code, as amended
(i.e., Seller is not a foreign corporation, foreign partnership, foreign trust,
foreign estate or foreign person as those terms are defined in the Internal
Revenue Code and regulations promulgated thereunder).
3.24    Patriot Act. Patriot Act and OFAC Compliance. Seller will not transfer
the proceeds obtained as a result of this Agreement to any person or entity
listed on the Office of Foreign Assets Control (“OFAC”) list as “Terrorists” and
“Specially Designated Nationals and Blocked Persons”, or otherwise be in
violation of the International Money Laundering Abatement and Financial Anti¬
Terrorism Act of 2001. Seller is not named, and is not acting, directly or
indirectly, for or on behalf of any person, group, entity, or nation named by
the Uniting and Strengthening America by Providing Appropriate Tools Required to
Intercept and Obstruct Terrorism Act of 2001 (Public Law 107-56,

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the “Patriot Act”), Executive Order #13224 or any other Executive Order or the
United States Treasury Department as a terrorist, “Specially Designated Nation
and Blocked Person,” or other banned or blocked person, entity, nation, or
transaction pursuant to any law, order, rule or regulation that is enforced or
administered by OFAC. Seller is not engaged in this transaction, directly or
indirectly on behalf of, or instigating or facilitating this transaction,
directly or indirectly on behalf of, any such person, group entity, or nation.
3.25    No Other Property Interests. There are no property interests, buildings,
structures or other improvements or personal property that are owned by Seller
which are necessary for the operation of the Hotel that are not being conveyed
pursuant to this Agreement.
Each of the representations and warranties contained in this Article III and its
various subparagraphs are intended for the benefit of Purchaser and may be
waived in whole or in part, by Purchaser, but only by an instrument in writing
signed by Purchaser. All rights and remedies arising in connection with the
untruth or inaccuracy of any such representations and warranties shall survive
the Closing of the transaction contemplated hereby for a period of twelve (12)
months following the Closing (the “Survival Period”), except to the extent that
Seller gives Purchaser written notice prior to Closing of the untruth or
inaccuracy of any representation or warranty, or Purchaser otherwise obtains
actual knowledge prior to Closing of the untruth or inaccuracy of any
representation or warranty, and Purchaser nevertheless elects to close this
transaction, in which event Purchaser shall be deemed to have waived its
objections to the untruth or inaccuracy of such representation(s). Purchaser
shall be deemed to have actual knowledge of the untruth or inaccuracy of any
representation or warranty only if (i) Purchaser receives written notice from
Seller, or (ii) David A. Brooks has actual knowledge of any such untruth or
inaccuracy.
The term “to Seller’s knowledge” or similar phrase shall mean solely the actual
knowledge of George Altamura, Jr. (the manager of Hotel Yountville, LLC),
Altamura Family, LLC and George Altamura, Jr., LLC and is the person associated
with Seller most familiar with the Property, and without any duty of inquiry.
Notwithstanding any language to the contrary, Seller’s liability for a breach of
its warranties and representations under this Agreement shall not exceed the
Aggregate Liability set forth in this Agreement.
ARTICLE IV
PURCHASER’S REPRESENTATIONS AND WARRANTIES
Purchaser acknowledges that it (a) has made or shall make prior to the
expiration of the Study Period, as defined below, such investigations of the
title, physical condition and zoning matters related to the Property and all
matters of interest to Purchaser regarding the operating history of the Property
as it deems appropriate, (b) has not relied, is not relying and shall not rely
on any statements, representations, or projections, whether oral or written,
heretofore or hereafter made by Seller or any of its managers, members,
consultants, agents, brokers or employees in connection with the physical
condition of the Property (other than those representations and warranties
contained in this Agreement, and (c) shall be fully satisfied with the business,
operations and conditions of the Property before the expiration of the Study
Period. Purchaser acknowledges that Purchaser shall

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be consummating the purchase of the Property based solely upon Purchaser’s
inspections and investigations of the Property and that Purchaser shall be
purchasing the Property on an “AS IS” and “WHERE IS” basis, subject solely to
Seller’s representations and warranties expressly contained in this Agreement.
Other than as set forth in this Agreement, Purchaser acknowledges that neither
Seller nor its managers, members, consultants, brokers or employees have made
any other representations or warranties of any kind on which Purchaser is
relying as to any matters concerning the physical condition of the Property,
including, but not limited to, the conditions and restrictions affecting the
Property, water or water rights, topography, drainage, soil, subsoil of the
Property, the utilities serving the Property or any zoning, environmental or
building laws, rules or regulations affecting the Property. Purchaser hereby
makes the following representations and warranties, upon each of which Purchaser
acknowledges and agrees that Seller is entitled to rely and has relied:
4.1    Organization and Power. Purchaser is a limited partnership duly
organized, validly existing and in good standing under the laws of the State of
Delaware, and has all partnership power and all governmental licenses,
authorizations, consents and approvals required to carry on its business as now
conducted and to enter into and perform its obligations under this Agreement and
any of the other Closing Documents to be executed and delivered on behalf of
Purchaser hereunder.
4.2    Authorization and Execution. This Agreement has been duly authorized by
all necessary action on the part of Purchaser, has been duly executed and
delivered by Purchaser, constitutes the valid and binding agreement of Purchaser
and is enforceable in accordance with its terms. The person executing this
Agreement on behalf of Purchaser has the authority to do so.
4.3    Non-contravention. The execution and delivery of this Agreement and the
performance by Purchaser of its obligations hereunder do not and will not
contravene, or constitute a default under, any provisions of Applicable Law or
regulation, or any agreement, judgment, injunction, order, decree or other
instrument binding upon Purchaser or result in the creation of any lien or other
encumbrance on any asset of Purchaser.
4.4    Litigation. There is no action, suit or proceeding, pending or known to
be threatened, against or affecting Purchaser in any court or before any
arbitrator or before any Governmental Authority which (a) in any manner raises
any question affecting the validity or enforceability of this Agreement or any
other agreement or instrument to which Purchaser is a party or by which it is
bound and that is to be used in connection with, or is contemplated by, this
Agreement, (b) could materially and adversely affect the business, financial
position or results of operations of Purchaser, and (c) could materially and
adversely affect the ability of Purchaser to perform its obligations hereunder,
or under any document to be delivered pursuant hereto.
4.5    Bankruptcy. No Act of Bankruptcy has occurred with respect to Purchaser.
4.6    Patriot Act and OFAC Compliance. Purchaser will not use proceeds to
purchase the Property from any person or entity listed on the Office of Foreign
Assets Control (“OFAC”) list as “Terrorists” and “Specially Designated Nationals
and Blocked Persons”, or otherwise be in violation of the International Money
Laundering Abatement and Financial Anti-Terrorism Act of 2001. Purchaser is not
named, and is not acting, directly or indirectly, for or on behalf of any

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person, group, entity, or nation named by the Uniting and Strengthening America
by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act
of 2001 (Public Law 107-56, the “Patriot Act”), Executive Order #13224 or any
other Executive Order or the United States Treasury Department as a terrorist,
“Specially Designated Nation and Blocked Person,” or other banned or blocked
person, entity, nation, or transaction pursuant to any law, order, rule or
regulation that is enforced or administered by OFAC. Purchaser is not engaged in
this transaction, directly or indirectly on behalf of, or instigating or
facilitating this transaction, directly or indirectly on behalf of, any such
person, group entity, or nation.
4.7    Sophisticated Real Estate Investor. Purchaser has extensive experience
regarding the acquisition, development and operation of hotel properties, and
has the capacity and expertise to undertake a comprehensive investigation of the
Property within the Study Period and, except for Seller’s Submittals, and
Seller’s warranties and representations set forth in this Agreement, Purchaser
requires no additional information from Seller to make a competent decision
whether or not to acquire the Property.
ARTICLE V    
CONDITIONS PRECEDENT
5.1    As to Purchaser’s Obligations. Purchaser’s obligations hereunder are
subject to the satisfaction of the following conditions precedent:
(a)    Seller’s Deliveries. Seller shall have delivered to or for the benefit of
Purchaser, on or before the Closing Date, all of the documents and other
information required of Seller pursuant to Sections 7.2 and 7.4 hereof.
(b)    Representations, Warranties and Covenants; Obligations of Seller;
Certificate. All of Seller’s representations and warranties made in this
Agreement shall be true and correct in all material respects as of the date
hereof and as of the date of Closing as if then made (or otherwise waived by
Purchaser); there shall have been no material adverse change in the business
conducted at the Property or the financial results thereof from the date of
acceptance of this Agreement and no matter, condition or event shall have
occurred which could in Purchaser’s reasonable judgment, materially and
adversely affect the operation, value or marketability of the Property or any
part thereof; Seller shall have performed in all material respects all of its
covenants and other obligations under this Agreement.
(c)    Title Insurance. Good and marketable fee simple title to the Real
Property shall be insurable as such by the Title Company, at its lowest rates
allowed by law, subject only to Permitted Title Exceptions as determined in
accordance with Section 2.4 hereof and including, without limitation, all
applicable deletions of standard exceptions and endorsements permitted under
applicable state law which are customarily required by institutional investors
purchasing property comparable to the Property.
(d)    Survey. The Survey shall be adequate for the Title Company to delete any
exception for general survey matters in the Owner’s Title Policy except for
“shortages in area”.

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(e)    Title to Property. Seller shall be the sole owner of good and marketable
fee simple title to the Real Property and good and marketable fee simple title
to the Tangible Personal Property, free and clear of all liens, encumbrances,
restrictions, conditions and agreements except for Permitted Title Exceptions.
Seller shall not have taken any action or permitted or suffered any action to be
taken by others from the date hereof and through and including the date of
Closing that would adversely affect the status of title to the Real Property and
Tangible Personal Property.
(f)    Condition of Improvements. The Improvements and the Tangible Personal
Property (including but not limited to the mechanical systems, plumbing,
electrical, wiring, appliances, fixtures, heating, air conditioning and
ventilating equipment, elevators, boilers, equipment, roofs, structural members
and furnaces) shall be in the same condition at Closing as they are as of the
date hereof, reasonable wear and tear excepted. Prior to Closing, Seller shall
not have materially diminished the quality or quantity of maintenance and upkeep
services heretofore provided to the Real Property and the Tangible Personal
Property and, except in the ordinary course of business, Seller shall not have
diminished the Inventory. Seller shall not have removed or caused or permitted
to be removed any part or portion of the Real Property or the Tangible Personal
Property without Purchaser’s prior written consent unless the same is replaced,
prior to Closing, with a similar item of at least equal suitability, quality and
value, free and clear of any lien or security interest.
(g)    Taxes. Seller shall provide to Purchaser written evidence from the
appropriate taxing authority of the payment of all sales, gross receipts, hotel
occupancy and other similar taxes in connection with the operation of the Hotel
before Closing. In the event Seller is unable or unwilling to obtain such
clearance certificates prior to Closing, Purchaser shall withhold from the
Purchase Price, an amount which is 110% of the amount of such taxes due for the
year prior to the Closing, less sales taxes already forwarded to the California
State Board of Equalization for the current tax period. Notwithstanding the
foregoing, Seller shall indemnify Purchaser for the amount by which the full
amount of all such sales, gross receipts, hotel occupancy and other similar
taxes in connection with the operation of the Hotel before Closing exceeds the
amount so withheld by Purchaser. The provisions of this Section 5.1(g) shall
survive the Closing.
(h)    Estoppels for Covenants, Conditions and Restrictions. On or before the
Closing Date, Seller shall provide Purchaser with a fully executed estoppel
certificate related to each of the Covenants, Conditions and Restrictions (the
“CCR Estoppel”) showing no material defaults. The CCR Estoppel must be in a form
reasonably satisfactory to Purchaser. To that end, Purchaser shall provide
Seller with a recommended form of CCR Estoppel within fifteen (15) days after
the delivery of the Survey and Title Commitment to Purchaser.
(i)    Third-Party Consents. On or before the Closing Date, Seller shall furnish
Purchaser, in form and content reasonably satisfactory to Purchaser, with any
and all third party consents (the “Third Party Consents”), which are necessary
to consummate the transaction contemplated in this Agreement.
(j)    Rights of First Refusal. Seller shall provide Purchaser with reasonably
satisfactory evidence of the waiver of any and all rights of first refusal or
options related to the Property that may have been granted with respect to the
Property.

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(k)    No Code Violations. There shall be no violations of Applicable Laws with
respect to the Property or the Hotel.
Each of the conditions contained in this Section are intended for the benefit of
Purchaser and may be waived in whole or in part, by Purchaser, but only by an
instrument in writing signed by Purchaser.
5.2    As to Seller’s Obligations. Seller’s obligations hereunder are subject to
the satisfaction of the following conditions precedent:
(a)    Purchaser’s Deliveries. Purchaser shall have delivered to or for the
benefit of Seller, on or before the Closing Date, all of the documents and
payments required of Purchaser pursuant to Sections 7.3 and 7.4 hereof.
(b)    Representations, Warranties and Covenants; Obligations of Purchaser. All
of Purchaser’s representations and warranties made in this Agreement shall be
true and correct in all material respects as of the date hereof and as of the
date of Closing as if then made and Purchaser shall have performed in all
material respects all of its covenants and other obligations under this
Agreement.
Each of the conditions contained in this Section are intended for the benefit of
Seller and may be waived in whole or in part, by Seller, but only by an
instrument in writing signed by Seller.
ARTICLE VI    
COVENANTS OF SELLER
To induce Purchaser to enter into this Agreement and to purchase the Property,
and to pay the Purchase Price therefor, Seller covenants and agrees to the
following:
6.1    Operating Agreements/Leased Property Agreements/Off-Site Facility
Agreements. Seller shall not enter into any new management agreement,
maintenance or repair contract, supply contract, lease in which it is lessee or
other agreements with respect to the Property, nor shall Seller enter into any
agreements modifying the Operating Agreements, Leased Property Agreements or
Off-Site Facility Agreements, unless (a) any such agreement or modification will
not bind Purchaser or the Property after the date of Closing or is subject to
termination on not more than thirty (30) days’ notice without penalty, or
(b) Seller has obtained Purchaser’s prior written consent to such agreement or
modification. Seller agrees to cancel and terminate effective as of the Closing
Date, at Seller’s sole cost, expense and liability, any Operating Agreements,
Leased Property Agreements or Off-Site Facility Agreements that Purchaser
notifies Seller of in writing before the expiration of the Study Period that
Purchaser will not assume. Purchaser shall have the right to assume the lease
for the storage facility that Seller maintains, on a month to month basis for
$1,200.00 per month.
6.2    Warranties and Guaranties. Seller shall not before or after Closing
release or modify any Warranties and Guaranties, if any, except with the prior
written consent of Purchaser.

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6.3    Insurance. Seller shall pay all premiums on, and shall not cancel or
voluntarily allow to expire, any of Seller’s Insurance Policies unless such
policy is replaced, without any lapse of coverage, by another policy or policies
providing coverage at least as extensive as the policy or policies being
replaced.
6.4    Independent Audit. Promptly following the execution of this Agreement,
Seller shall provide to Purchaser’s representatives and independent accounting
firm access to financial and other information relating to the Property in the
possession of or otherwise available to Seller or its affiliates which would be
sufficient to enable Purchaser’s representatives and independent accounting firm
to prepare audited financial statements for the three (3) calendar years prior
to the Closing and during the year in which the Closing occurs in conformity
with generally accepted accounting principles and to enable them to prepare such
statements, reports or disclosures as Purchaser may deem necessary or advisable.
Seller shall also provide to Purchaser’s independent accounting firm a signed
representation letter which would be sufficient to enable an independent public
accountant to render an opinion on the financial statements related to the
Property. Seller shall authorize any attorneys who have represented Seller or
its management company in material litigation pertaining to or affecting the
Property to respond, at Purchaser’s expense, to inquiries from Purchaser’s
representatives and independent accounting firm. For the purposes of this
provision, material litigation includes matters with liability exceeding
$50,000. If and to the extent Seller’s financial statements pertaining to the
Property for any periods during the three (3) calendar years prior to the
Closing and during the year in which the Closing occurs have been audited,
promptly after the execution of this Agreement Seller shall provide Purchaser
with copies of such audited financial statements and shall cooperate with
Purchaser’s representatives and independent public accountants to enable them to
contact the auditors who prepared such audited financial statements and to
obtain, at Purchaser’s expense, a reissuance of such audited financial
statements.
6.5    Operation of Property Prior to Closing. Seller covenants and agrees with
Purchaser that, between the date of this Agreement and the date of Closing:
(a)    Subject to the restrictions contained herein, Seller shall operate the
Property in the ordinary course of business and in the same manner in which
Seller operated the Property prior to the execution of this Agreement, so as to
keep the Property in good condition, reasonable wear and tear excepted, so as to
maintain consistent inventory levels, so as to maintain the existing caliber of
the Hotel operations conducted at the Property and so as to maintain the
reasonable good will of all tenants of the Property and all employees, guests
and other customers of the Hotel.
(b)    Seller shall maintain its books of account and records in the usual,
regular and ordinary manner, in accordance with sound accounting principles
applied on a basis consistent with the basis used in keeping its books in prior
years.
(c)    Seller shall use and operate the Property in compliance with Applicable
Laws and the requirements of any mortgage, and any lease, Occupancy Agreement,
Operating Agreement and Insurance Policy affecting the Property.
(d)    Seller shall cause to be paid prior to delinquency all ad valorem,
occupancy and sales taxes due and payable with respect to the Property or the
operation of the Hotel.

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(e)    Except as otherwise permitted hereby, Seller shall not take any action or
fail to take action the result of which would have a material adverse effect on
the Property or Purchaser’s ability to continue the operation thereof after the
date of Closing in substantially the same manner as presently conducted, or
which would cause any of the representations and warranties contained in
Article III hereof to be untrue as of Closing in any material respect.
(f)    Seller shall not enter into new leases of space at the Hotel.
(g)    Seller shall not fail to maintain the Improvements and the Tangible
Personal Property (including, but not limited to, the mechanical systems,
plumbing, electrical, wiring, appliances, fixtures, heating, air conditioning
and ventilating equipment, elevators, boilers, equipment, roofs, structural
members and furnaces) in the same condition as they are as of the date hereof,
reasonable wear and tear excepted.
(h)    Seller shall not diminish the quality or quantity of maintenance and
upkeep services heretofore provided to the Real Property and the Tangible
Personal Property and Seller shall not permit the Inventory to be diminished
other than as a result of the ordinary and necessary operation of the Hotel by
Seller.
(i)    Seller shall not remove or cause or permit to be removed any part or
portion of the Real Property or the Tangible Personal Property without the
express written consent of Purchaser unless the same is replaced, prior to
Closing, with similar items of at least equal suitability, quality and value,
free and clear of any liens or security interests.
(j)    Seller shall continue to use reasonable efforts to take guest room
reservations and to book functions and meetings and otherwise to promote the
business of the Property in generally the same manner as Seller did prior to the
execution of this Agreement; and all advance room bookings and reservations and
all meetings and function bookings shall be booked at rates, prices and charges
heretofore customarily charged by Seller for such purposes, and in accordance
with Seller’s published rate schedules. Seller acknowledges that the Purchase
Price includes the transfer of Advance Bookings.
(k)    Seller shall (1) not enter into any agreements which shall be binding
upon Purchaser with respect to the Property or that otherwise cannot be
terminated without penalty upon thirty (30) days’ notice, or (2) reduce or cause
to be reduced any room rents or any other charges over which Seller has
operational control.
(l)    Seller shall promptly deliver to Purchaser upon Purchaser’s request such
reports showing the revenue and expenses of the Hotel and all departments
thereof, together with such periodic information with respect to room
reservations and other bookings, as Seller customarily keeps or receives
internally for its own use.
(m)    Seller (1) shall not enter into any new Employment Agreements that are
not terminable at will without the express written consent of Purchaser, and
(2) with respect to those employees listed on Schedule 6 attached hereto, shall
not change, modify, extend, renew or terminate

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any Employment Agreement in effect as of the date hereof which would be binding
on Purchaser with respect to the Property without the express written consent of
Purchaser.
(n)    Seller shall promptly advise Purchaser of any litigation, arbitration or
administrative hearing concerning or affecting the Property of which Seller
obtains actual knowledge.
(o)    Seller shall not modify or release any Warranties or Guaranties
applicable to the Property.
(p)    Seller shall not grant any encumbrances on the Property or contract for
any construction or service for the Property which may impose any mechanics’ or
materialmen’s lien on the Property.
(q)    Seller shall not agree to make any changes to the Parking Agreement
without Purchaser’s consent, which consent shall be in Purchaser’s sole and
absolute discretion.
6.6    Marketing Restriction. At the expiration of the Study Period, and
provided that Purchaser has not then terminated this Agreement, Seller shall (i)
cease marketing the Property for sale, (ii) cease conducting discussions or
negotiations with other potential purchasers of the Property and (iii) not
accept backup offers.
6.7    Employees and Continuation of Seller’s Group Health Plans. Payment of all
costs and expenses associated with accrued but unpaid salary, earned but unpaid
vacation pay, accrued but unearned vacation pay, pension and welfare benefits,
the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended (“COBRA”)
benefits, employee fringe benefits, employee termination payments or any other
employee benefits due to Seller’s employees up to the Closing Date shall be the
sole responsibility and obligation of and shall be paid promptly by Seller.
Seller shall indemnify and defend Purchaser and/or its lessee or management
company, from and against any and all claims, causes of action, proceedings,
judgments, damages, penalties and liabilities made, assessed or rendered against
Purchaser and/or its lessee or management company and any costs and expenses
(including attorneys’ fees and disbursements) incurred by Purchaser and/or its
lessee or management company with respect to claims, causes of action,
judgments, damages, penalties and liabilities asserted by such employees arising
out of the failure of Seller to comply with the provisions of this Section 6.7.
This indemnification shall be separate from and in addition to the
indemnification given by Seller to Purchaser in Article IX below.
6.8    Rights of First Refusal and Options. Seller shall provide Purchaser with
reasonably satisfactory evidence of the waiver of any and all rights of first
refusal or options related to the Property that may have been granted to any
party.
6.9    Fitness Center. A Hotel Fitness Center is in the process of being
constructed (the “Construction”). The plans for the work are attached hereto as
Exhibit 6.9. Seller shall complete the Construction on or before Closing in a
good and workmanlike manner, fully paid for and lien free (the Fitness Center
constitutes solely the structure designated on the plans, and not any of the
equipment and apparatus that may be installed after completion of the Fitness
Center). If the

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Construction is not complete as aforesaid by Closing, Seller shall continue
construction of the Fitness Center with Seller's own employees, contractors or
subcontractors (so long as such employees, contractors and subcontractors are
not Hotel employees); shall indemnify Purchaser from any and all claims, losses
and damages that may arise out of such construction activity, and shall provide
an insurance policy with combined single limits of $3,000,000 naming Purchaser
as an additional insured. Seller shall diligently proceed with such
construction, but shall not be responsible for any delays in completion
resulting from factors beyond its control. If such Construction is not complete
as of one hundred twenty (120) days after Closing, Purchaser may elect to
complete the Construction and reimburse itself for the cost thereof from the
Holdback Amount.
ARTICLE VII
CLOSING
7.1    Closing. The Closing shall occur on a business day designated by
Purchaser, with at least five (5) days written notice to Seller (or if such
written notice is not given, no later than fifteen (15) days following the
expiration of the Study Period). As more particularly described below, at the
Closing the parties hereto will execute all of the documents required to be
delivered in connection with the transactions contemplated hereby (the “Closing
Documents”), (i) deliver the same to Escrow Agent, and (ii) take all other
action required to be taken in respect of the transactions contemplated hereby.
The Closing will occur through escrow at the offices of Escrow Agent. At the
Closing, Purchaser shall deliver the balance of the Purchase Price to Escrow
Agent, Escrow Agent shall update the title to the Property and, provided there
has been no change in the status of title as reflected in the Title Commitment
and Survey, Escrow Agent shall record the Deed, release and date, where
appropriate, the Closing Documents in accordance with the instructions of Seller
and Purchaser and shall send, by wire transfer, all sums owing to Seller
hereunder to Seller. As provided herein, the parties hereto will agree upon
adjustments and prorations to certain items which cannot be exactly determined
at the Closing and will make the appropriate adjustments with respect thereto.
Possession of the Property shall be delivered to Purchaser at the Closing,
subject only to Permitted Title Exceptions and the rights of tenants under the
Occupancy Agreements and guests in possession.
7.2    Seller’s Deliveries. At the Closing, Seller shall deliver to Escrow Agent
all of the following instruments, each of which shall have been duly executed
and, where applicable, acknowledged and/or sworn on behalf of Seller and shall
be dated as of the Closing Date:
(a)    The Deed (subject to such changes as are required by Applicable Law,
local recording requirements and/or customary real estate practices in the
jurisdiction(s) in which the Property is located, provided, the substantive
terms and provisions of the Deed attached hereto are not modified as a result of
any such changes).
(b)    The Bill of Sale.
(c)    The Assignment of Occupancy Agreements.
(d)    The Assignment and Assumption Agreement.

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(e)    Off-Site Facility Estoppels, CCR Estoppels, and All Third Party Consents.
(f)    The Post-Closing Escrow Agreement.
(g)    Certificates from the applicable State taxing authority and local taxing
authorities or other appropriate verification demonstrating that all occupancy,
sales and ad valorem real and personal property taxes due and payable for the
Property have been paid and, if any such taxes have not been paid, the amount
due and payable as of the Closing Date.
(h)    Certificate(s)/Registration of Title for any vehicle owned by Seller and
used in connection with the Property that are included in the purchase.
(i)    Such agreements, affidavits or other documents as may be required by the
Title Company to issue the Owner’s Title Policy subject only to the Permitted
Title Exceptions and to eliminate such standard exceptions and to issue such
endorsements thereto which may be eliminated and issued under applicable State
law and which are customarily required by institutional investors purchasing
property comparable to the Property.
(j)    The FIRPTA Certificate.
(k)    An assignment of each of the Leased Property Agreements to Purchaser
and/or its property manager, lessee or other designee (as Purchaser shall
specify), together with (1) the written consent of the lessors of such Leased
Property Agreements, if required by such Leased Property Agreements, and
(2) executed originals of all such Leased Property Agreements in Seller’s
possession or reasonably available to Seller. If any Leased Property is leased
pursuant to a Leased Property Agreements which is a capital lease, in accordance
with generally accepted accounting principles, Seller shall cancel such capital
lease at its expense and convey good and marketable title to such property
(which shall constitute Tangible Personal Property hereunder) to Purchaser
and/or its property manager, lessee or other designee (as Purchaser shall
specify) free from any lien or encumbrance pursuant to the Bill of Sale –
Personal Property.
(l)    Written notice executed by Seller notifying all interested parties,
including, without limitation, all tenants under any Occupancy Agreements, that
the Property has been conveyed to Purchaser and directing that all payments,
inquiries and the like be forwarded to Purchaser at the address to be provided
by Purchaser.
(m)    Any other document or instrument reasonably necessary or required to
consummate the transactions contemplated by this Agreement.
At the Closing, Seller shall deliver to Purchaser or make available to Purchaser
at the Property the following documents:
(a)    All original Warranties and Guaranties in Seller’s possession or
reasonably available to Seller.
(b)    If Purchaser is assuming Seller’s obligations under any or all of the
Operating Agreements, Off-Site Facility Agreements or Covenants, Conditions and
Restrictions, to the extent

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in Seller’s possession or reasonably available to Seller, copies of such
agreements, duly assigned to Purchaser and with such assignment acknowledged and
approved by the other parties to such Operating Agreements, Off-Site Facility
Agreements or Covenants, Conditions and Restrictions to the extent required by
such Operating Agreements, Off-Site Facility Agreements or Covenants, Conditions
and Restrictions.
(c)    To the extent in Seller’s possession or reasonably available to Seller,
originals of the following items (copies of which were delivered by Seller to
Purchaser with the Submission Matters): (1) complete sets of all architectural,
mechanical, structural and/or electrical plans and specifications used in
connection with the construction of or alterations or repairs to the Property;
and (2) as-built plans and specifications for the Property.
(d)    Copies of all agreements, leases, concession agreements and other
instruments affecting the Property and the Hotel and/or restaurant business
conducted thereon.
(e)    All current real estate and personal property tax bills in Seller’s
possession or under its control.
(f)    Access to guest registration cards, guest transcripts, guest histories,
and all other available guest information for eighteen (18) months on-site, and
up to seven years at Seller’s Off-Site Facility.
(g)    An updated schedule of employees, showing salaries and duties, with a
statement of the length of service of each such employee, brought current to a
date not more than forty-eight (48) hours prior to the Closing.
(h)    A complete list of all Advance Bookings, in reasonable detail so as to
enable Purchaser to honor Seller’s commitments in that regard.
(i)    A list of Seller’s outstanding accounts receivable as of midnight on the
date prior to the Closing, specifying the name of each account and the amount
due Seller.
(j)    A list of all vendors and suppliers servicing the Hotel.
(k)    All books, records, operating reports, appraisal reports, files and other
materials in Seller’s possession or control which are necessary in Purchaser’s
discretion to maintain continuity of operation of the Property.
(l)    Copies of all Occupancy Agreements and, to the extent available,
Authorizations transferred or assigned to Purchaser at Closing as required
hereunder.
7.3    Purchaser’s Deliveries. At the Closing, Purchaser shall deliver to Escrow
Agent all of the following, each of which, if required, shall have been duly
executed and, where applicable, acknowledged and/or sworn on behalf of Purchaser
and shall be dated as of the Closing Date:
(a)    The portion of the Purchase Price described in Section 2.2 hereof.

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(b)    The Assignment and Assumption Agreement.
(c)    The Assignment of Occupancy Agreements.
(d)    Any other document or instrument reasonably necessary or required to
consummate the transactions contemplated by this Agreement.
7.4    Mutual Deliveries. At the Closing, Purchaser and Seller shall mutually
execute and deliver each to the other:
(a)    A final closing statement reflecting the Purchase Price and the
adjustments and prorations required hereunder and the allocation of income and
expenses required hereby.
Such other and further documents, papers and instruments as may be reasonably
required by the parties hereto or their respective counsel.
7.5    Closing Costs. Except as is explicitly provided in this Agreement, each
party hereto shall pay its own legal fees and expenses. The escrow fees and
filing fees shall be borne solely by Purchaser. Documentary transfer taxes and
recording fees shall be paid by Seller. Seller shall pay sales taxes
attributable to its operations on or before Closing; Purchaser shall pay all
sales taxes for operations after Closing, as well as all sales taxes assessed by
the California State Board of Equalization for the value of the tangible
personal property acquired by Purchaser. Seller shall pay for the costs
associated with the releases of any deeds of trust, mortgages and other
financing encumbering the Property and for any costs associated with any
corrective instruments. Purchaser shall pay all costs associated with the
Survey. Purchaser shall pay all costs for title search and the title insurance
premium for the issuance of the Title Policy. Purchaser shall pay the cost of
the UCC Searches. All endorsements to the Title Policy shall be paid by
Purchaser. All other costs (except any costs incurred by Seller for its own
account) which are necessary to carry out the transactions contemplated
hereunder shall be allocated between Purchaser and Seller in accordance with
Napa County local custom.
7.6    Revenue and Expense Allocations. All revenues and expenses with respect
to the Property, and applicable to the period of time before and after Closing,
determined in accordance with sound accounting principles consistently applied,
shall be allocated between Seller and Purchaser as provided herein. Seller shall
be entitled to all revenue and shall be responsible for all expenses for the
period of time up to but not including the date of Closing, and Purchaser shall
be entitled to all revenue and shall be responsible for all expenses for the
period of time from, after and including the date of Closing (provided that
housekeeping costs and the Rooms Ledger for the date of Closing shall be shared
equally between Purchaser and Seller). Such adjustments shall be shown on the
closing statements (with such supporting documentation as the parties hereto may
require being attached as exhibits to the closing statements) and shall increase
or decrease (as the case may be) the cash amount payable by Purchaser pursuant
to Section 2.2 hereof. Without limiting the generality of the foregoing, the
following items of revenue and expense shall be allocated and prorated, as the
case may be, at Closing:
(a)    Current rents.

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(b)    Real estate and personal property taxes.
(c)    Revenue and expenses under the Operating Agreements, Off-Site Facility
Agreements and Covenants, Conditions and Restrictions to be assigned to and
assumed by Purchaser.
(d)    Utility charges (including, but not limited to, charges for water, sewer
and electricity).
(e)    Municipal or other governmental improvement liens, which shall be paid by
Seller at Closing where the work has physically commenced, and which shall be
assumed by Purchaser at Closing where the work has been authorized, but not
physically commenced.
(f)    Insurance premiums, to the extent required hereby.
(g)    License and permit fees, where transferable.
(h)    All other revenues and expenses of the Property, including, but not
limited to, such things as restaurant, bar and meeting room income and expenses
and the like.
(i)    The Rooms Ledger and housekeeping costs (i.e. the hourly wages paid for
housekeeping staff employed during such day) for the date of Closing (to be
apportioned equally between Seller and Purchaser).
(j)    Such other items as are usually and customarily prorated between
purchasers and sellers of hotel properties in the area where the Property is
located.
Purchaser shall receive a credit against the Purchase Price for the total of
(i) prepaid rents, (ii) prepaid room receipts and deposits, function receipts
and deposits and other reservation receipts and deposits, (iii) unforfeited
security deposits together with interest thereon held by Seller under Occupancy
Agreements, and (iv) the value of any complimentary rooms (based upon the “rack”
rate for each room) and any complimentary food or beverages (based upon the
advertised rate for each food and beverage) provided by Seller from and after
6:00 a.m. on the Closing Date (the parties acknowledge that Seller’s charitable
contributions, to be identified and provided to Purchaser during the Study
Period restrict occupancy generally to mid-week stays and the rack rate
applicable for such stay shall be based on such midweek rack rate). At Closing,
Seller shall sell to Purchaser in connection with the Hotel, and Purchaser shall
purchase from Seller, at face value: (i) all petty cash funds in the hands of
the Seller in connection with the Hotel guest operations at the Property; and
(ii) the so-called “guest ledger” as mutually approved by Purchaser and Seller
for the Hotel of guest accounts receivable payable to the Hotel as of the
check-out time for the Hotel on the Closing Date (based on guests and customers
then using the Hotel) both (1) in occupancy from the preceding night through
check out time the morning of the Closing Date, and (2) previously in occupancy
prior to check out time on the Closing Date; provided, however, that the term
“guest ledger” shall not include any accounts receivable which have been or are
to be paid by any means other than a credit card except for corporate groups
whose creditworthiness have been reasonably approved by Purchaser during the
Study Period. Purchaser shall not be obligated to purchase such non-credit card
accounts receivable. For purposes of this Agreement, transfer or sale at face
value shall have

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the following meanings: (i) for petty cash, an amount equal to the total of all
petty cash funds on hand and transferred to Purchaser; and (ii) for the guest
ledger, the total of all credit card accounts receivable as shown on the records
of the Hotel, less actual collection costs (i.e., fees retained by credit card
companies), less accounting charges for rooms furnished on a gratuity or
complimentary basis to any hotel staff or as an accommodation to other parties
and less Purchaser’s one-half (½) share of Rooms Ledger. The purchase price of
said petty cash fund and guest ledger, as determined above, shall be paid to
Seller at Closing by a credit to Seller in the computation of the adjustments
and prorations on the Closing Date.
Seller shall pay or cause to be paid the currently due, but not delinquent,
portion of all real estate taxes and special assessments for the Property due
and payable in, or deferred with respect to the years prior to, the year in
which the Closing occurs and Seller or Purchaser, as the case may be, shall
receive a credit at Closing based on the pro rata portion of the real estate
taxes based on the Closing Date. All special assessments pending, levied or due
and payable on or prior to the Closing Date shall be paid by Seller on or before
the Closing Date. All subdivision and platting costs and expenses heretofore
incurred by Seller, including, without limitation, all subdivision exactions,
fees and costs and all dedication of land for parks and other public uses or
payment of fees in lieu thereof, shall be paid by Seller on or prior to the
Closing Date.
Seller shall be required to pay or cause to be paid on or before the Closing
Date any accrued or earned wages, vacation pay, sick leave, bonuses, pension,
profit-sharing and welfare benefits and other compensation and fringe benefits
of all persons employed at the Property on or before the Closing Date, including
any employment taxes or other fees or assessments attributable thereto.
Seller shall be required to pay all sales, occupancy and similar taxes and like
impositions currently through the date of Closing and deliver copies of paid
checks and applicable statements to Purchaser.
Seller shall be responsible for payments of amounts owing to third parties in
respect of inventory and supplies ordered by Seller in respect of the Hotel
prior to the Closing Date. Notwithstanding the foregoing, special purchases
needed for future Advance Bookings which have been approved by Purchaser “in
writing” and which relate to the period from and after Closing shall be the
responsibility of Purchaser.
Purchaser shall not be obligated to collect any delinquent rents, accounts
receivable or revenues accrued prior to the Closing Date for Seller, but if
Purchaser collects same, such amounts shall be promptly remitted to Seller in
the form received.
If accurate allocations cannot be made at Closing because current bills are not
obtainable (as, for example, in the case of utility bills and/or real estate or
personal property taxes), the parties shall allocate such revenue or expenses at
Closing on the best available information, subject to adjustment upon receipt of
the final bill or other evidence of the applicable revenue or expense. The
obligation to make the adjustment shall survive the closing of the transaction
contemplated by this Agreement. Any revenue received or expense incurred by
Seller or Purchaser with respect to the Property after the date of Closing shall
be promptly allocated in the manner described herein and the parties shall
promptly pay or reimburse any amount due. The proration provisions of this

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Agreement shall survive the closing of the transaction contemplated hereby for a
period of twelve (12) months.
7.7    Acquisition and Transfer of Inventory and Personal Property. As part of
the Property and included in the Purchase Price, Seller agrees to transfer to
Purchaser or its lessee, property manager or other designee (as Purchaser shall
specify) all inventories of food and beverage and unused reserve stock
(including in-use operating supplies) of linens, towels, paper goods, soaps,
cleaning supplies, china, glassware, silverware and miscellaneous guest
supplies, engineering cleaning supplies and the like (collectively, the
“Inventory”) and Personal Property.
ARTICLE VIII
GENERAL PROVISIONS
8.1    Condemnation. In the event of any actual or threatened taking, pursuant
to the power of eminent domain, of all or a portion of the Real Property valued
at $250,000 or more, or any proposed sale in lieu thereof, Seller shall give
written notice thereof to Purchaser promptly after Seller learns or receives
notice thereof. If all or any part of the Real Property is, or is to be, so
condemned or sold, Purchaser shall have the right to terminate this Agreement
pursuant to Section 9.3 hereof. If Purchaser elects not to terminate this
Agreement, all proceeds, awards and other payments arising out of such
condemnation or sale (actual or threatened) shall be paid or assigned, as
applicable, to Purchaser at Closing. Seller shall not settle or compromise any
such proceeding without Purchaser’s written consent. If Purchaser elects to
terminate this Agreement by giving Seller written notice thereof prior to the
Closing, the Deposit shall be promptly returned to Purchaser and all rights and
obligations of Seller and Purchaser hereunder (except those set forth herein
which expressly survive a termination of this Agreement) shall terminate
immediately. If the loss is less than $250,000, Purchaser shall be obligated to
proceed to Closing and all condemnation awards received by Seller shall be
delivered to Purchaser and if no proceeds have been delivered to Seller, all
awards and proceeds shall be assigned to Purchaser.
8.2    Risk of Loss. The risk of any loss or damage to the Property prior to the
recordation of the Deed shall remain upon Seller. If any such loss or damage
resulting in a cost of repair or restoration exceeding $250,000 occurs prior to
Closing, Purchaser shall have the right to terminate this Agreement pursuant to
Section 9.3 hereof. If Purchaser elects not to terminate this Agreement, all
insurance proceeds and rights to proceeds arising out of such loss or damage
shall be paid or assigned, as applicable, to Purchaser at Closing and Purchaser
shall receive as a credit against the Purchase Price the amount of any
deductibles under the policies of insurance covering such loss or damage. If
Purchaser elects to terminate this Agreement by giving Seller written notice
thereof prior to the Closing, the Deposit shall be promptly returned to
Purchaser and all rights and obligations of Seller and Purchaser hereunder
(except those set forth herein which expressly survive a termination of this
Agreement) shall terminate immediately. If the cost to repair is less than
$250,000, Purchaser shall proceed to Closing, the insurance proceeds received or
to be received by Seller shall be provided to or assigned to Purchaser,
Purchaser shall receive a credit at Closing in the amount of Seller’s insurance
deductible and a credit for the amount of any uninsured loss.
8.3    Broker. The parties acknowledge that Broker has been the procuring cause
of this Agreement. It shall be the obligation of Seller to pay Broker its
commission, when, as and if the

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transaction contemplated hereby actually closes, in accordance with a separate
agreement between the Broker and Seller. There is no other real estate broker
involved in this transaction. Purchaser warrants and represents to Seller that
Purchaser has not dealt with any other real estate broker in connection with
this transaction, nor has Purchaser been introduced to the Property or to Seller
by any other real estate broker, and Purchaser shall indemnify Seller and hold
Seller harmless from and against any claims, suits, demands or liabilities of
any kind or nature whatsoever arising on account of the claim of any other
person, firm or corporation to a real estate brokerage commission or a finder’s
fee as a result of having dealt with Purchaser, or as a result of having
introduced Purchaser to Seller or to the Property. In like manner, Seller
warrants and represents to Purchaser that Seller has not dealt with any other
real estate broker in connection with this transaction, nor has Seller been
introduced to Purchaser by any other real estate broker, and Seller shall
indemnify Purchaser and save and hold Purchaser harmless from and against any
claims, suits, demands or liabilities of any kind or nature whatsoever arising
on account of the claim of any person, firm or corporation to a real estate
brokerage commission or a finder’s fee as a result of having dealt with Seller
in connection with this transaction. This provision shall survive any
termination of this Agreement and a closing of the transaction contemplated
hereby.
8.4    Bulk Sale. It shall be the obligation of Seller to comply with any bulk
sale requirements, statutes, laws, ordinances and regulations promulgated with
respect thereto, if any, in the State in which the Property is located, or in or
by any governmental entity having jurisdiction with respect thereto, and to
provide proof of such compliance or proof that no such compliance is required,
to Purchaser, at or prior to Closing. In any event, Seller shall indemnify
Purchaser and save and hold Purchaser harmless from and against any claims,
suits, demands, liabilities or obligations of any kind or nature whatsoever,
including all costs of defending same, and reasonable attorneys’ fees paid or
incurred in connection therewith, arising out of or relating to any claim made
by any third party or any liability asserted by any third party that any
applicable bulk sales law or like statute has not been complied with. The
provisions of this Section shall survive the Closing of the transaction
contemplated hereby.
8.5    Confidentiality. Except as hereinafter provided, from and after the
execution of this Agreement, Purchaser and Seller shall keep the terms,
conditions and provisions of this Agreement confidential and neither shall make
any public announcements hereof unless the other first approves of same in
writing, nor shall either disclose the terms, conditions and provisions hereof,
except to persons who “need to know,” such as their respective officers,
directors, employees, attorneys, accountants, engineers, surveyors, consultants,
financiers, partners, investors, potential lessees and bankers and such other
third parties whose assistance is required in connection with the consummation
of this transaction. Notwithstanding the foregoing, it is acknowledged that
Purchaser is, or is an affiliate of, a real estate investment trust (the
“REIT”), and the REIT has and will seek to sell shares to the general public;
consequently, Purchaser shall have the right to disclose any information
regarding the transaction contemplated by this Agreement solely if disclosure is
required by law or otherwise been determined to be necessary or appropriate by
Purchaser or Purchaser’s attorneys to satisfy disclosure and reporting
obligations of Purchaser or its affiliates. On or at any time following the
Effective Date, Purchaser may make a press release and file with the United
States Securities Exchange Commission information regarding the transaction
contemplated by this Agreement. Seller and Purchaser and their representatives
are cautioned that United States securities

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laws restrict the purchase and sale of securities by anyone who possesses
non-public information about the issue of such securities. Accordingly, neither
Seller nor any of its Affiliates nor its representatives may buy or sell any of
the securities of the Purchaser or any of its Affiliates so long as any of them
is in possession of any material non-public information about the Purchaser or
any of its Affiliates, including information contained in or derived from
confidential information.
8.6    Seller’s Accounts Receivable. It is expressly agreed by and between
Purchaser and Seller that Seller is not hereby agreeing to sell to Purchaser,
and Purchaser is not hereby agreeing to purchase from Seller, any of Seller’s
accounts receivable. All of Seller’s accounts receivable shall be and remain the
property of Seller, subsequent to the Closing of the transaction contemplated
hereby. At the Closing, Seller shall prepare a list of its outstanding accounts
receivable as of midnight on the date prior to the Closing, specifying the name
of each account and the amount due to Seller. Purchaser shall hold any funds
received by Purchaser explicitly designated as payment of such accounts
receivable, in trust, if Purchaser actually collects any such amounts, and shall
pay the monies collected in respect thereof to Seller at the end of each
calendar month, accompanied by a statement showing the amount collected on each
such account. Other than the foregoing, Purchaser shall have no obligation with
respect to any such account, and Purchaser shall not be required to take any
legal proceeding or action to effect collection on behalf of Seller. It is
generally the intention of Purchaser and Seller that although all of Seller’s
accounts receivable shall be and remain the property of Seller, still, if any
such accounts are paid to Purchaser, then Purchaser shall collect same and remit
to Seller in the manner above provided. Nothing herein contained shall be
construed as requiring Purchaser to remit to Seller any funds collected by
Purchaser on account of Purchaser’s accounts receivable generated from Hotel
operations, even if the person or entity paying same is also indebted to Seller.
Other than eviction proceedings, Seller may bring any legal action to enforce
collection of payment of any accounts receivable against any current tenant of
the Property or other third party in a contractual or business relationship with
the Property as of the Closing Date.
ARTICLE IX
LIABILITY OF PURCHASER; INDEMNIFICATION
BY SELLER; DEFAULT; TERMINATION RIGHTS
9.1    Liability of Purchaser. Except for obligations expressly assumed or
agreed to be assumed by Purchaser hereunder, Purchaser is not assuming any
obligations of Seller or any liability for claims arising out of any act,
omission or occurrence which occurs, accrues or arises prior to the Closing
Date, and subject to the Aggregate Liability (as limited by its definition)
Seller hereby indemnifies and holds Purchaser harmless from and against any and
all claims, costs, penalties, damages, losses, liabilities and expenses
(including reasonable attorneys’ fees) that may at any time be incurred by
Purchaser as a result of (1) obligations of Seller not expressly assumed or
agreed to be assumed by Purchaser hereunder, or (2) other than with respect to
the physical or environmental conditions of the Property, acts, omissions or
occurrences which occur, accrue or arise prior to the Closing Date. The
provisions of this Section shall survive the Closing of the transaction
contemplated hereby.
9.2    Indemnification by Seller. Subject to the Aggregate Liability (as limited
by its definition) Seller hereby indemnifies and holds Purchaser harmless from
and against any and all

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claims, costs, penalties, damages, losses, liabilities and expenses (including
reasonable attorneys’ fees) that may at any time be incurred by Purchaser,
whether before or after Closing, as a result of any inaccuracy or breach by
Seller of any of its representations, warranties, covenants or obligations set
forth herein or in any other document delivered by Seller pursuant hereto except
for any breach or inaccuracy of any representation or warranty as to which
Seller has given Purchaser written notice prior to Closing of the untruth or
inaccuracy or of which Purchaser otherwise had actual knowledge prior to the
Closing and nevertheless elected to consummate the Closing; provided, however,
the foregoing knowledge limitation on Seller’s indemnity shall not limit
Purchaser’s remedy described in Section 9.3(a)(ii) hereof. The provisions of
this Section shall survive the Closing of the transaction contemplated hereby.
9.3    Default by Seller/Failure of Conditions Precedent. If any condition set
forth herein for the benefit of Purchaser cannot or will not be satisfied prior
to Closing, or upon the occurrence of any other event that would entitle
Purchaser to terminate this Agreement and its obligations hereunder, and if
Seller fails to cure any such matter or satisfy that condition within ten (10)
business days after notice thereof from Purchaser (or such other time period as
may be explicitly provided for herein), Purchaser, at its option, may elect
(a) to terminate this Agreement, in which event (i) the Deposit shall be
promptly returned to Purchaser, (ii) if the condition which has not been
satisfied is a breach of a representation, warranty or covenant, then Seller
shall be obligated upon demand to reimburse Purchaser for Purchaser’s actual
out-of-pocket inspection, financing and other costs related to Purchaser’s
entering into this Agreement, inspecting the Property and preparing for a
Closing of the transaction contemplated hereby, including, without limitation,
Purchaser’s attorneys’ fees incurred in connection with the preparation,
negotiation and execution of this Agreement and in connection with Purchaser’s
due diligence review, audits and preparation for a Closing; and (iii) all other
rights and obligations of Seller and Purchaser hereunder (except those set forth
herein which expressly survive a termination of this Agreement) shall terminate
immediately; or (b) elect to proceed to Closing. If Purchaser elects to proceed
to Closing and there is either a misrepresentation or breach of a warranty by
Seller (other than a breach of a representation or warranty of which Purchaser
had actual knowledge prior to the Closing and nevertheless elected to consummate
the Closing) or the breach of a covenant by Seller or a failure by Seller to
perform its obligations hereunder, Purchaser shall retain all remedies accruing
as a result thereof, including, but not limited to the remedy of specific
performance of Seller’s covenants and obligations and the remedy of the recovery
of all reasonable damages resulting from Seller’s breach of warranty or
covenant. Should Purchaser elect to terminate the transaction the total sum
payable by Seller to Purchaser shall not exceed Five Hundred Thousand Dollars
($500,000) and shall be reasonably documented. If Purchaser elects to proceed to
Closing, Purchaser shall automatically have released Seller from any further
liability for any such known breach of warranty or representation.
9.4    Default by Purchaser/Failure of Conditions Precedent. If any condition
set forth herein for the benefit of Seller (other than a default by Purchaser)
cannot or will not be satisfied prior to Closing, and if Purchaser fails to
satisfy that condition within ten (10) business days after notice thereof from
Seller (or such other time period as may be explicitly provided for herein),
Seller may, at its option, elect either (a) to terminate this Agreement in which
event the Deposit shall be promptly returned to Purchaser and the parties hereto
shall be released from all further obligations hereunder except those which
expressly survive a termination of this Agreement, or

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(b) to waive its right to terminate, and instead, to proceed to Closing. If,
prior to Closing, Purchaser defaults in performing any of its obligations under
this Agreement (including its obligation to purchase the Property), and
Purchaser fails to cure any such default within ten (10) business days after
notice thereof from Seller, then Seller’s sole remedy for such default shall be
to terminate this Agreement and retain the Deposit. Seller and Purchaser agree
that, in the event of such a default, the damages that Seller would sustain as a
result thereof would be difficult if not impossible to ascertain. Therefore,
Seller and Purchaser agree that, Seller shall retain the Deposit as full and
complete liquidated damages and as Seller’s sole remedy; provided, however, the
indemnity obligations imposed on Purchaser under the provisions of Section
2.4(c) shall not be subject to such liquidated damages remedy.
LIQUIDATED DAMAGES. NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED IN THIS
AGREEMENT, IF THE SALE TO PURCHASER IS NOT CONSUMMATED AS A RESULT OF
PURCHASER’S DEFAULT UNDER THIS AGREEMENT, SELLER SHALL BE ENTITLED TO RETAIN THE
DEPOSIT AS LIQUIDATED DAMAGES FOR PURCHASER’S DEFAULT. THE PARTIES ALSO AGREE
THAT IT WOULD BE IMPRACTICABLE AND EXTREMELY DIFFICULT TO ASCERTAIN THE ACTUAL
DAMAGES SUFFERED BY SELLER AS A RESULT OF PURCHASER’S FAILURE TO COMPLETE THE
PURCHASE PURSUANT TO THIS AGREEMENT AND THAT, UNDER THE CIRCUMSTANCES EXISTING
AS OF THE EFFECTIVE DATE, THE RETENTION OF THE DEPOSITS AS LIQUIDATED DAMAGES
PROVIDED FOR IN THIS SECTION REPRESENTS A REASONABLE ESTIMATE OF THE DAMAGES
WHICH SELLER WILL INCUR AS A RESULT OF SUCH FAILURE; PROVIDED, HOWEVER, THAT
THIS PROVISION SHALL NOT LIMIT SELLER’S RIGHTS TO RECEIVE REIMBURSEMENT FOR
ATTORNEYS’ FEES, NOR WAIVE OR AFFECT SELLER’S RIGHTS AND PURCHASER’S INDEMNITY
OBLIGATIONS UNDER OTHER SECTIONS OF THIS AGREEMENT. THE PARTIES ACKNOWLEDGE THAT
THE PAYMENT OF SUCH LIQUIDATED DAMAGES IS NOT INTENDED AS A FORFEITURE OR
PENALTY WITHIN THE MEANING OF CALIFORNIA CIVIL CODE SECTION 3275 OR 3369, BUT IS
INTENDED TO CONSTITUTE LIQUIDATED DAMAGES TO SELLER PURSUANT TO CALIFORNIA CIVIL
CODE SECTIONS 1671, 1676, AND 1677. THE PARTIES HAVE SET FORTH THEIR INITIALS
BELOW TO INDICATE THEIR AGREEMENT WITH THE LIQUIDATED DAMAGES PROVISION
CONTAINED IN THIS SECTION.

SELLER: _______________________         PURCHASER: __________________
9.5    Costs and Attorneys’ Fees. In the event of any litigation or dispute
between the parties arising out of or in any way connected with this Agreement,
resulting in any litigation, then the prevailing party in such litigation shall
be entitled to recover its costs of prosecuting and/or defending same,
including, without limitation, reasonable attorneys’ fees at trial and all
appellate levels. The provisions of this Section 9.5 shall survive the Closing
of the transaction contemplated hereby.

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9.6    Limitation of Liability. Notwithstanding anything herein to the contrary,
except in the case of fraud by either party, the liability of each party hereto
resulting from the breach or default by either party shall be limited to actual
damages incurred by the injured party (subject to the Aggregate Liability as
limited by its definition) and except in the case of fraud by either party, the
parties hereto hereby waive their rights to recover from the other party
punitive, consequential, exemplary, and speculative damages. The provisions of
this Section 9.6 shall survive the Closing of the transaction contemplated
hereby.
ARTICLE X
[INTENTIONALLY DELETED]
ARTICLE XI
MISCELLANEOUS PROVISIONS
11.1    Completeness; Modification. This Agreement constitutes the entire
agreement between the parties hereto with respect to the transactions
contemplated hereby and supersedes all prior discussions, understandings,
agreements and negotiations between the parties hereto. This Agreement may be
modified only by a written instrument duly executed by the parties hereto.
11.2    Assignments. Purchaser may assign all or any portion of its rights
hereunder to one or more Affiliates of Purchaser without the consent of Seller;
however, any such assignment shall not relieve Purchaser of its obligations
under this Agreement.
11.3    Successors and Assigns. This Agreement shall bind and inure to the
benefit of the parties hereto and their respective successors and assigns.
11.4    Days. If any action is required to be performed, or if any notice,
consent or other communication is given, on a day that is a Saturday or Sunday
or a legal holiday in the jurisdiction in which the action is required to be
performed or in which is located the intended recipient of such notice, consent
or other communication, such performance shall be deemed to be required, and
such notice, consent or other communication shall be deemed to be given, on the
first business day following such Saturday, Sunday or legal holiday. Unless
otherwise specified herein, all references herein to a “day” or “days” shall
refer to calendar days and not business days.
11.5    Governing Law. This Agreement and all documents referred to herein shall
be governed by and construed and interpreted in accordance with the laws of the
state where the Property is located.
11.6    Counterparts. To facilitate execution, this Agreement may be executed in
as many counterparts as may be required. It shall not be necessary that the
signature on behalf of both parties hereto appear on each counterpart hereof.
All counterparts hereof shall collectively constitute a single agreement. This
Agreement may be executed and delivered by facsimile transmission or by personal
digital file format via electronic mail which shall, for all purposes, serve as
an original executed counterpart of this Agreement.

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11.7    Severability. If any term, covenant or condition of this Agreement, or
the application thereof to any person or circumstance, shall to any extent be
invalid or unenforceable, the remainder of this Agreement, or the application of
such term, covenant or condition to other persons or circumstances, shall not be
affected thereby, and each term, covenant or condition of this Agreement shall
be valid and enforceable to the fullest extent permitted by law.
11.8    Costs. Regardless of whether Closing occurs hereunder, and except as
otherwise expressly provided herein, each party hereto shall be responsible for
its own costs in connection with this Agreement and the transactions
contemplated hereby, including, without limitation, fees of attorneys, engineers
and accountants.
11.9    Notices. All notices, requests, demands and other communications
hereunder shall be in writing and shall be delivered by hand, transmitted by
facsimile transmission, sent prepaid by Federal Express (or a comparable
overnight delivery service), or sent by email. Any notice, request, demand or
other communication delivered or sent in the manner aforesaid shall be deemed
given or made (as the case may be) on the earlier of actual receipt or one day
after transmittal.
If to Seller:
George Altamura, Jr.
101 S. Coombs Street, Suite A

Napa, CA 94559
George Altamura, Jr.
Telecopy: 707-255-2053
Email: galtajr@yahoo.com
With a copy to:
Charles W. Meibeyer
Coblentz Patch Duffy & Bass LLP
1236 Spring Street
St. Helena, CA 94574
Telecopy: 707-963-4897

Email: cwm@coblentzlaw.com
If to Purchaser:
Ashford Hospitality Prime Limited Partnership
14185 Dallas Parkway, Suite 1100
Dallas, Texas 75254
    Attn: David A. Brooks and Christopher A. Peckham
Telecopy: (972) 490-9605

Email: dbrooks@ashfordinc.com and cpeckham@ashfordinc.com
With a copy to:
Gardere Wynne Sewell LLP
2021 McKinney Avenue, Suite 1600
Dallas, Texas 75201
Attn: Cynthia B. Nelson
Telecopy: (214) 999-3884

Email: cnelson@gardere.com

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If to Escrow Agent:
Chicago Title Insurance Company
711 Third Avenue, 5th Floor
New York, New York 10017
Attn: Siu Cheung
Telecopy: (212) 880-9623

Email: cheungs@ctt.com
or to such other address as the intended recipient may have specified in a
notice to the other party. Any party hereto may change its address or designate
different or other persons or entities to receive copies by notifying the other
party and Escrow Agent in a manner described in this Section.
11.10    Escrow Agent. Escrow Agent referred to in the definition thereof
contained in Section 1.1 hereof has agreed to act as such for the convenience of
the parties without fee or other charges for such services as Escrow Agent.
Escrow Agent shall not be liable: (a) to any of the parties for any act or
omission to act except for its own willful misconduct or gross negligence;
(b) for any legal effect, insufficiency, or undesirability of any instrument
deposited with or delivered by Escrow Agent or exchanged by the parties
hereunder, whether or not Escrow Agent prepared such instrument; (c) for any
loss or impairment of funds that have been deposited in escrow while those funds
are in the course of collection, or while those funds are on deposit in a
financial institution, if such loss or impairment results from the failure,
insolvency or suspension of a financial institution; (d) for the expiration of
any time limit or other consequence of delay, unless a properly executed written
instruction, accepted by Escrow Agent, has instructed Escrow Agent to comply
with said time limit; (e) for the default, error, action or omission of either
party to the escrow. Escrow Agent, in its capacity as escrow agent, shall be
entitled to rely on any document or paper received by it, believed by such
Escrow Agent, in good faith, to be bona fide and genuine. In the event of any
dispute as to the disposition of the Deposit or any other monies held in escrow,
or of any documents held in escrow, Escrow Agent may continue to hold the
Deposit pursuant to the terms hereof, or if Escrow Agent so elects, interplead
the matter at the joint and several cost of Purchaser and Seller by filing an
interpleader action in a court of general jurisdiction in the county or circuit
where the Real Property is located (to the jurisdiction of which both parties do
hereby consent), and pay into the registry of the court the Deposit, or deposit
any such documents with respect to which there is a dispute in the Registry of
such court, whereupon such Escrow Agent shall be relieved and released from any
further liability as Escrow Agent hereunder. Escrow Agent shall not be liable
for Escrow Agent’s compliance with any legal process, subpoena, writ, order,
judgment and decree of any court, whether issued with or without jurisdiction,
and whether or not subsequently vacated, modified, set aside or reversed.
Purchaser and Seller agree to jointly and severally indemnify, defend and hold
harmless the Escrow Agent from and against any loss, cost, damage, expense and
attorney’s fee (collectively called “Expenses”) in connection with or in any way
arising out of the escrow arrangement, other than expenses resulting from the
Escrow Agent’s own gross negligence or willful misconduct.
11.11    Incorporation by Reference. All of the exhibits attached hereto are by
this reference incorporated herein and made a part hereof.

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11.12    Survival. All of the covenants and agreements of Seller and Purchaser
made in, or pursuant to, this Agreement shall survive Closing and shall not
merge into the Deed or any other document or instrument executed and delivered
in connection herewith.
11.13    Further Assurances. Seller and Purchaser each covenant and agree to
sign, execute and deliver, or cause to be signed, executed and delivered, and to
do or make, or cause to be done or made, upon the written request of the other
party, any and all agreements, instruments, papers, deeds, acts or things,
supplemental, confirmatory or otherwise, as may be reasonably required by either
party hereto for the purpose of or in connection with consummating the
transactions described herein.
11.14    No Partnership. This Agreement does not and shall not be construed to
create a partnership, joint venture or any other relationship between the
parties hereto except the relationship of Seller and Purchaser specifically
established hereby.
11.15    Time of Essence. Time is of the essence with respect to every provision
hereof.
11.16    Signatory Exculpation. The signatory(ies) for Purchaser and Seller
is/are executing this Agreement in his/their capacity as representative of
Purchaser and Seller and not individually and, therefore, shall have no personal
or individual liability of any kind in connection with this Agreement and the
transactions contemplated by it.
11.17    Rules of Construction. The following rules shall apply to the
construction and interpretation of this Agreement:
(a)    Singular words shall connote the plural number as well as the singular
and vice versa, and the masculine shall include the feminine and the neuter.
(b)    All references herein to particular articles, sections, subsections,
clauses or exhibits are references to articles, sections, subsections, clauses
or exhibits of this Agreement.
(c)    The table of contents and headings contained herein are solely for
convenience of reference and shall not constitute a part of this Agreement nor
shall they affect its meaning, construction or effect.
(d)    Each party hereto and its counsel have reviewed and revised (or requested
revisions of) this Agreement and have participated in the preparation of this
Agreement, and therefore any usual rules of construction requiring that
ambiguities are to be resolved against a particular party shall not be
applicable in the construction and interpretation of this Agreement or any
exhibits hereto.
(e)    As used herein, the term or phrases “Effective Date,” “date of this
Agreement” or “date hereof” shall mean the first date Escrow Agent is in receipt
of this Agreement executed by Seller and Purchaser.
11.18    Tax-Deferred Exchange. Each party agrees to cooperate with the other
party’s efforts to accomplish a tax-deferred exchange in this transaction
provided that no party shall bear any

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additional cost, and there is no delay to the close of escrow and Purchaser
shall not have to take title to any property other than the Property. This
cooperation applies as well to the members or affiliates of any such party.
11.19    Liquor Operations.
(a)    Change of Ownership Filings; Transfer of Liquor Licenses. Seller shall
cause the holder of the liquor license for the Hotel (the “Liquor Licensee”), at
Purchaser’s sole cost and expense, to use all reasonable efforts to transfer the
liquor licenses and the liquor inventory to Purchaser or its designee (in either
case, a “License Designee”), as successor licensee, on or after the Closing
Date. Purchaser and Seller shall jointly use good faith efforts to have the
License Designee accept the transfer of the liquor licenses. If such liquor
licenses have not been transferred to a License Designee effective as of the
Closing Date, or a temporary permit (a “Temporary Permit”) to sell alcohol at
the Hotel has not been issued to a License Designee as of the Closing Date, then
on the Closing Date, to the extent permitted by applicable law, Seller shall
cause the Liquor Licensee to enter into an interim management or lease
arrangement with a License Designee (the “Food and Beverage Management
Agreement”) substantially in the form attached hereto as Exhibit "G", whereby
such Liquor Licensee shall operate for a mutually agreeable fee or rental rate
the food and beverage facilities at the Hotel on behalf of Purchaser pending the
transfer of the applicable liquor licenses to a License Designee or the issuance
of a Temporary Permit.
(b)    Liquor Inventory Escrow. In connection with the transfer of the liquor
licenses, on or before the Closing Date, Seller shall open an escrow account for
the Hotel (the “Liquor Inventory Escrow”) with a mutually agreed escrow holder
(“Liquor Escrowee”), separate from the Escrow, as required by applicable law for
the transfer of the liquor license to a License Designee on the Closing Date or
such later date as such transfer is approved by the California Department of
Alcoholic Beverage Control (“CABC”). The Liquor Inventory Escrow arrangements
shall be substantially in the form attached hereto as Exhibit G, and include the
following: (i) the deposit by Purchaser, on or before the Closing Date, of the
purchase price for the liquor licenses in the amount of [$______] (the “Liquor
License Payment”), and (ii) the deposit by Purchaser, on or before the Closing
Date in the amount of [$______] (the “Liquor Inventory Escrow Deposit”). The
Liquor License Payment and the Liquor Inventory Escrow Deposit shall be
deposited by Purchaser in the Liquor Inventory Escrow on or before the Closing
Date, and Purchaser shall receive a credit against the Purchase Price in the
amount of the Liquor License Payment. Any and all funds remaining in the Liquor
Inventory Escrow after the payment of claims by Liquor Licensee’s creditors, if
any, shall be remitted to Seller by Liquor Escrowee upon the approval by the
CABC of the transfer of the liquor licenses to a License Designee. The
provisions of this Section 11.19 are a condition precedent for the benefit of
Purchaser.
11.20    Holdback. At Closing, out of the Purchase Price paid by Purchaser,
Escrow Agent shall retain in escrow the amount of the Liability Cap in
immediately available U.S. federal funds (the “Holdback Amount”), which Holdback
Amount shall be held by Escrow Agent in escrow for three hundred sixty-five
(365) days after Closing pursuant to an escrow agreement in the form attached
hereto as Exhibit I, and shall be available to satisfy any post-Closing
liabilities of Seller under this Agreement, including, without limitation, any
surviving indemnity obligations of Seller

41
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and any liabilities with respect to a breach by Seller of any warranty,
representation or covenant that expressly survives Closing (the “Post-Closing
Holdback Escrow Agreement”).
[Remainder of page intentionally left blank – signatures follow on next page]

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IN WITNESS WHEREOF, Seller and Purchaser have caused this Agreement to be
executed in their names by their respective duly authorized representatives.
SELLER:
HOTEL YOUNTVILLE, LLC, a California limited liability company

By:
/s/ George Altamura Jr    

Name:
George Altamura Jr    

Title:
Manager    

Date of Execution: January 13,
, 2017

HOTEL YOUNTVILLE HOLDINGS, LLC, a California limited liability company

By:
/s/ Michael Yacob    

Name:
Michael Yacob    

Title:
Senior Vice President    

Date of Execution: January 13
, 2017

ALTAMURA FAMILY, LLC, a California limited liability company

By:
/s/ George Altamura Jr    

Name:
George Altamura Jr    

Title:
Manager    

Date of Execution: January 13,
, 2017

GEORGE ALTAMURA, JR., LLC, a California limited liability company

By:
/s/ George Altamura Jr    

Name:
George Altamura Jr    

Title:
Manager    

Date of Execution: January 13,
, 2017

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PURCHASER:
ASHFORD HOSPITALITY PRIME LIMITED PARTNERSHIP, a Delaware limited partnership
By: Ashford Prime OP General Partner LLC, its general partner
By:
/s/ David Brooks    

Name:
David Brooks    

Title:
Vice President    

Date of Execution: January 12,
, 2017

ESCROW AGENT:
Chicago Title Insurance Company (Escrow Agent hereby acknowledges receipt of a
fully executed Agreement from both Seller and Purchaser for purposes of
Sections 11.10 and 11.17 hereof.)
By:
/s/ Lisa Zicchinella    

Name:
Lisa Zicchinella    

Title:
National Underwriter    

Date:
January 13,    , 2017

RECEIPT OF ESCROW AGENT
Chicago Title Insurance Company, as Escrow Agent, acknowledges receipt of the
sum of $2,000,000.00 by check or by wire transfer from Purchaser as described in
Section 2.2 of the foregoing Agreement of Purchase and Sale, said check or wire
transfer to be held pursuant to the terms and provisions of said Agreement.
DATED this _____ day of __________________, 2017.
CHICAGO TITLE INSURANCE COMPANY
By:        
Name:        
Title:        

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EXHIBIT A

LAND
The land referred to in this report is situated in the Town of Yountville,
County of Napa, State of California, and is described as follows:
TRACT ONE:
Parcel 1 as shown on the map entitled, “Parcel Map, A Division of the Lands of
James DeHaven Atwood,” filed June 14, 1990 in Book 17 of Parcel Maps at page 75
in the office of the County Recorder of Napa County.

TRACT TWO:
Parcel 2 as shown on the map entitled “Parcel Map of the Yountville Inn
Expansion and Gateway Mobile Home Park,” filed March 28, 2008, in Book 25 of
Parcel Maps at page(s) 98-100, in the office of the County Recorder of Napa
County.

TRACT THREE:
Parcel 3 as shown on the map entitled “Parcel Map of the Yountville Inn
Expansion and Gateway Mobile Home Park,” filed March 28, 2008, in Book 25 of
Parcel Maps at page(s) 98-100, in the office of the County Recorder of Napa
County.

Exhibit A – Page 1
9695236v.8

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EXHIBIT B

INTENTIONALLY DELETED

16480.001 3614102v1 Exhibit B – Page 1
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EXHIBIT C

ASSIGNMENT AND ASSUMPTION AGREEMENT
For Ten and No/100 Dollars ($10.00) and other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged,
_______________________________, a _________________________ (“Seller”) hereby
assigns and delegates to __________________________, a _____________
(“Assignee”) all of its right, title and interest in and to the following:
(i)    all Operating Agreements (as defined in that certain Agreement of
Purchase and Sale dated ____________, 20___ by and between Seller and
_______________________ (the “Agreement”) with respect to the Property (as
defined in the Agreement), and listed on Exhibit A attached hereto;
(ii)    all Leased Property Agreements (as defined in the Agreement) described
on Exhibit A attached hereto;
(iii)    all Off-Site Facility Agreements (as defined in the Agreement)
described on Exhibit A attached hereto;
Assignee hereby assumes and agrees to perform all of the obligations of Seller
under the Operating Agreements, Leased Property Agreements and Off-Site Facility
Agreements (collectively the “Assigned Agreements”), to the extent any such
obligations accrue and are applicable to periods from and after the date hereof
or which accrue prior to the date hereof for which Assignee received a credit on
the closing statement of even date herewith between the parties (or pursuant to
any post-closing adjustment thereof).
Seller hereby agrees to indemnify, defend and hold harmless Assignee and its
affiliates from and against any and all liabilities, claims, costs and expenses,
including, without limitation, reasonable attorney’s fees, relating to acts or
omissions accruing under the Assigned Agreements prior to the date hereof.
Assignee hereby agrees to indemnify, defend and hold harmless Seller and its
affiliates from and against any and all liabilities, claims, costs and expenses,
including, without limitation, reasonable attorney’s fees, relating to acts or
omissions accruing under the Assigned Agreements from and after the date hereof
or with respect to obligations otherwise assumed by Assignee herein.
If any litigation between Seller and Assignee arises out of the obligations of
the parties under this Assignment and Assumption Agreement 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 litigation
including, without limitation, reasonable attorneys’ fees.
This Assignment and Assumption Agreement may be executed and delivered in any
number of counterparts, each of which so executed and delivered shall be deemed
to be an original and all

Exhibit C – Page 1
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--------------------------------------------------------------------------------

of which shall constitute one and the same instrument. Telecopied signatures
shall have the same valid and binding effect as original signatures.
IN WITNESS WHEREOF, Seller and Assignee have executed this Assignment as of
___________________, 20___.
SELLER:
,
a     
By:        
Name:        
Title:        
ASSIGNEE:
,
a     
By:        
By:        
Name:        
Title:        

Exhibit C – Page 2
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Exhibit A to Assignment and Assumption Agreement

OPERATING AGREEMENTS, LEASED PROPERTY
AGREEMENTS AND OFF SITE FACILITY AGREEMENTS

Exhibit C – Page 3
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EXHIBIT D

BILL OF SALE
For valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, _________________________________, (“Seller”), in connection with
the sale of certain real property located in the Town of Yountville and County
of Napa, California, which is more particularly described in the Purchase
Agreement (as defined below), hereby grants, assigns, transfers, conveys and
delivers to, without recourse and without any representation or warranty
whatsoever, express or implied, other than as set forth herein and in a certain
Purchase and Sale Agreement dated __________, 2017 (the “Purchase Agreement”)
pursuant to which this Bill of Sale is given, all of Seller’s right, title and
interest in and to the “Personal Property”, as such term is defined in the
Purchase Agreement. This Bill of Sale shall be governed by the laws of the State
of California.
TO HAVE AND TO HOLD the Personal Property, together with any rights and
appurtenances thereto, unto Purchaser, its successors and assigns.
IN WITNESS WHEREOF, Seller has executed this Bill of Sale effective as of
____________________, 20____.
SELLER:
,

a     
By:        
Name:        
Title:        

Exhibit D – Page 1
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EXHIBIT E
RECORDING REQUESTED BY :
AND
WHEN RECORDED MAIL TO:
GRANT DEED

Documentary Transfer Tax is: _____________

__ computed on full value of interest; or
__ full value less value of liens or encumbrances
                        remaining at time of sale

GRANT DEED

FOR A VALUABLE CONSIDERATION, receipt of which is hereby acknowledged,
    ____________________________________________ (“Grantor”), hereby GRANTS to
______________________________ (“Grantee”), the following described real
property (the “Property”) located in the City of Yountville and County of Napa,
State of California, subject only to those exceptions set forth on Exhibit 2
attached hereto:

SEE EXHIBIT “1” ATTACHED HERETO AND INCORPORATED HEREIN BY THIS REFERENCE

IN WITNESS WHEREOF, the undersigned has executed this Grant Deed dated as of
______________, 2017.

--------------------------------------------------------------------------------

By: _________________________________
Name: _______________________________

Exhibit E – Page 1
9695236v.8

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Title: ________________________________

Exhibit E – Page 2
9695236v.8

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EXHIBIT 1 TO EXHIBIT E
LEGAL DESCRIPTION

Exhibit E – Page 3
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ACKNOWLEDGMENT

State of California
County of _____________________________)

On _________________________ before me,
_________________________________________

personally appeared
______________________________________________________________, who proved to me
on the basis of satisfactory evidence to be the person(s) whose name(s) is/are
subscribed to the within instrument and acknowledged to me that he/she/they
executed the same in his/her/their authorized capacity(ies), and that by
his/her/their signature(s) on the instrument the person(s), or the entity upon
behalf of which the person(s) acted, executed the instrument.

I certify under PENALTY OF PERJURY under the laws of the State of California
that the foregoing paragraph is true and correct.

WITNESS my hand and official seal.

 
Signature: ___________________________ (Seal)

Exhibit E – Page 4
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EXHIBIT F

ASSIGNMENT OF OCCUPANCY AGREEMENTS
For Ten and No/100 Dollars ($10.00) and other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged,
________________________ ___________________, a
___________________________________ (“Seller”), hereby assigns to
_______________________ (“Assignee”) all of its right, title and interest in and
to the Occupancy Agreements, as defined in that certain Agreement of Purchase
and Sale dated _________________, 2017 by and between Seller and
__________________ (the “Agreement”), listed on Exhibit A attached hereto.
Assignee hereby assumes and agrees to perform all of the obligations of Seller
under the Occupancy Agreements to the extent any such obligations accrue and are
applicable to periods from and after the date hereof or which accrue prior to
the date hereof for which Assignee received a credit on the closing statement of
even date herewith between the parties (or pursuant to any post-closing
adjustment thereof).
Seller hereby agree to indemnify, defend and hold harmless Assignee and its
affiliates from and against any and all liabilities, claims, costs and expenses,
including, without limitation, reasonable attorney’s fees, relating to acts or
omissions accruing under the Occupancy Agreements prior to the date hereof.
Assignee hereby agrees to indemnify, defend and hold harmless Seller and its
affiliates from and against any and all liabilities, claims, costs and expenses,
including, without limitation, reasonable attorney’s fees, relating to acts or
omissions accruing under the Occupancy Agreements from and after the date hereof
or with respect to obligations otherwise assumed by Assignee herein.
If any litigation between Seller and Assignee arises out of the obligations of
the parties under this Assignment of Occupancy Agreements 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 litigation
including, without limitation, reasonable attorneys’ fees.
This Assignment of Occupancy Agreements may be executed and delivered in any
number of counterparts, each of which so executed and delivered shall be deemed
to be an original and all of which shall constitute one and the same instrument.
Telecopied signatures may be attached hereto and shall have the same valid and
binding effect as original signatures.
IN WITNESS WHEREOF, Seller and Assignee have executed this Assignment of
Occupancy Agreements as of ___________________, 2017.

Exhibit F – Page 1
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--------------------------------------------------------------------------------

SELLER:
,

a     
By:        
Name:        
Title:        
ASSIGNEE:
,

a     
By:        
Name:        
Title:        

Exhibit F – Page 2
9695236v.8

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Exhibit A to Assignment of Occupancy Agreements

Occupancy Agreements

Exhibit F – Page 3
9695236v.8

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*Subject to local counsel review
EXHIBIT G

FOOD AND BEVERAGE MANAGEMENT AGREEMENT
This FOOD AND BEVERAGE MANAGEMENT AGREEMENT (“Agreement”) is made, as of the ___
day of _______ , 2017 by and between ______________________ (“Licensee”),
    __________________ (“Manager”) and ______________________ (Owner”).
The purpose of this Agreement is to clarify the rights and obligations of the
parties with respect to responsibility for the operation of the alcoholic
beverage business (the “Business”) at the Hotel currently known as the Hotel
Yountville, 6462 Washington Street, Yountville, California (the “Hotel”), during
the pendency of the transfer of the alcoholic beverage license and alcoholic
beverage inventory from Licensee to Manager.
1.    Licensee agrees to transfer the License to Manager, and Owner agrees to
cause Manager to file for transfer of the License as soon as reasonably
possible. Licensee agrees to cooperate in the transfer of the License, the
opening of the escrow and the completion of all necessary paperwork. Owner
agrees to pay or arrange for payment of all escrow, application and transfer
fees.
2.    During the term of this Agreement, Licensee shall be responsible for the
operation of the Business at the Hotel, and Owner hereby grants Licensee the
right to enter onto the Hotel premises and to use same as may be necessary for
that purpose. Until such time as the California Department of Alcoholic Beverage
Control (“ABC”) approves the transfer of the Liquor License to Manager, Manager
shall operate the Business as the manager thereof on behalf of Licensee and
shall assure compliance with all laws pertaining to the operation of the
Business. Owner hereby consents to Manager’s operation of the Business on behalf
of and pursuant to the direction and control of Licensee.
3.    Title to the Inventory shall remain in Licensee until the ABC approves the
transfer of the Liquor License to Manager. Until such time, all proceeds from
the operation of the Business at the Hotel shall be applied to the operating
expenses of the Business.
4.    Manager and Owner agree to indemnify Licensee against any and all loss,
cost, liability and expense (including attorneys’ fees) that may arise from
Manager’s management of the Business; provided, however, such indemnity shall
not apply to any matter that relates to an event that occurred prior to the date
hereof, or that arose due to Licensee’s negligence or willful misconduct.
Manager and Owner agree to provide all customary insurance coverages at the
Hotel and to name Licensee, and its members, as additional insureds on such
policies for the term of this Agreement.
5.    Licensee and Manager shall not be construed as partners, joint venture
partners or as having an employer or employee relationship, and nothing
contained herein shall be construed to the contrary.

Exhibit G – Page 1
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6.    This Agreement may be executed in counterparts, each of which shall be
deemed an original, but all of which, together, shall constitute one and the
same instrument, binding on the parties hereto.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
stated above.
OWNER:

--------------------------------------------------------------------------------

By:        
Name:        
Title:        
LICENSEE:

--------------------------------------------------------------------------------

By:        
Name:        
Title:        
MANAGER:

--------------------------------------------------------------------------------

By:        
Name:        
Title:        

Exhibit G – Page 2
9695236v.8

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EXHIBIT H

PARKING AGREEMENT

Exhibit H – Page 1
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EXHIBIT I
FORM OF POST-CLOSING HOLDBACK ESCROW AGREEMENT
THIS POST-CLOSING HOLDBACK ESCROW AGREEMENT (this “Escrow Agreement”), dated as
of ___________, 2017, is by and among _______________, a _______________
(“Seller”), _______________, a _______________ (“Buyer”), and [-] (“Escrow
Agent”).
RECITALS:
A.    WHEREAS, Seller and Buyer entered into that certain Agreement of Purchase
and Sale dated January ____, 2017 (as amended, the “Purchase Agreement”). All
initially capitalized terms not otherwise defined in this Escrow Agreement shall
have the meaning ascribed to such term in the Purchase Agreement.
B.    WHEREAS, of even date herewith, Seller and Buyer have consummated the
Closing and, in connection therewith, Seller and Buyer desire to establish an
escrow with Escrow Agent pursuant to Section 11.20 of the Purchase Agreement.
C.    WHEREAS, Buyer and Seller desire to appoint Escrow Agent as the escrow
agent pursuant to this Escrow Agreement, and Escrow Agent is willing to act as
escrow agent hereunder.
D.    WHEREAS, Escrow Agent has agreed to hold and disburse the funds pursuant
to the terms of this Escrow Agreement.
NOW THEREFORE, in consideration of the covenants and agreements contained in
this Escrow Agreement, and intending to be legally bound, the parties hereto
agree as follows:
AGREEMENT
Article I    
APPOINTMENT OF ESCROW AGENT
1.1    The parties hereto hereby appoint the Escrow Agent to act as escrow agent
hereunder, and the Escrow Agent hereby agrees to serve as escrow agent upon the
terms and conditions set forth herein. Escrow Agent shall hold, invest and
disburse the Escrow Funds (as hereinafter defined) in accordance with the terms
of this Escrow Agreement, which terms shall include, without limitation, the
provisions of Article 3 below.
Article II    
ESCROW
2.1    Escrow. Seller hereby deposits Four Million and 00/100 DOLLARS
($4,000,000) (the funds together with any interest earned thereon are
hereinafter referred to as the “Escrow Funds”) into escrow with the Escrow
Agent, and the Escrow Agent hereby acknowledges receipt thereof. Seller hereby
expressly confirms that it has instructed Escrow Agent to create the Escrow Fund
by retaining $4,000,000.00 of the net sales proceeds payable to Seller upon the
Closing under the Purchase Agreement. The Escrow Funds, together with the
interest thereon, shall be deposited

Exhibit I – Page 1
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by Escrow Agent into a federally insured, interest bearing account at
[___________] (the “Holdback Account”). Escrow Agent hereby agrees that the
Escrow Funds shall not be commingled with any other funds. The parties hereto
hereby agree that the Escrow Funds are the “Holdback Amount” referred to in the
Purchase Agreement.
2.2    Fee. Escrow Agent was selected as escrow agent and as the title agent, in
connection with the Closing under the Purchase Agreement, in part because it
agreed to act as Escrow Agent hereunder without any additional consideration due
to it, and Escrow Agent acknowledges that it is not due any additional fee for
its services hereunder.
2.3    Disbursement of Escrow Funds. Escrow Agent shall only disburse the Escrow
Funds as follows:
2.3.1.    At such time as Buyer asserts, in good faith, a claim for disbursement
of funds from the Holdback Account (a “Claim”), Buyer shall give written notice
thereof (the “Disbursement Request”) to Seller and Escrow Agent. Any such
Disbursement Request shall describe in reasonable detail Buyer’s calculations of
the amount of Escrow Funds due Buyer (the “Claim Amount”) and the facts and/or
circumstances giving rise to such Claim, and contain appropriate supporting
documentation with respect thereto. Seller shall have ten (10) Business Days
after receipt of the Disbursement Request to object to the disbursement of the
Claim Amount requested by Buyer by submitting a notice of objection (the
“Objection Notice”) to Buyer and Escrow Agent, which objection shall be solely
on the grounds that Seller disagrees, in good faith, with Buyer’s entitlement to
or calculations of the Claim Amount set forth in the applicable Disbursement
Request. If Seller delivers the Objection Notice within such ten (10) Business
Day period, then Section 2.3.4 hereof shall apply with respect to Escrow Agent’s
disbursement of the Claim Amount. If Seller does not deliver the Objection
Notice to Buyer and Escrow Agent within such ten (10) Business Day period, then
Escrow Agent shall disburse the Claim Amount to Buyer in accordance with the
Disbursement Request within three (3) Business Days following the expiration of
such ten (10) Business Day period. Buyer shall have the right to deliver
multiple Disbursement Requests and receive multiple disbursements from the
Escrow Funds but shall only submit one Disbursement Request for each Claim.
2.3.2    Notwithstanding any provision of Section 0 above to the contrary, if
Buyer and Seller jointly submit a Disbursement Request with regard to all or any
portion of the Escrow Funds, Escrow Agent shall disburse the requested amounts
from the Holdback Escrow within three (3) Business Days following its receipt of
the joint Disbursement Request pursuant to the directions set forth therein.
2.3.3    If there is remaining balance of the Escrow Funds on ______________,
20__ (the “Release Date”) then, to the extent such remaining balance is not
subject to an unresolved Disbursement Request, such undisputed portion shall be
remitted to Seller. The Claim Amount(s) subject to an unresolved Disbursement
Request shall be retained in the Holdback Escrow by Escrow Agent until, with
respect to each Claim Amount, (i) the expiration of the ten (10) Business Day
period provided in Section 0 above with respect to a specific Disbursement
Request, if no Objection Notice is delivered by Seller to Escrow Agent within
such ten (10)  Business Day period with respect to such Disbursement Request;
(ii) Seller and Buyer resolve any dispute with respect to any

Exhibit I – Page 2
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Objection Notice which has been timely provided by Seller and jointly submit a
Disbursement Request to Escrow Agent; or (iii) Escrow Agent has brought an
interpleader action with respect to such Claim as set forth below.
2.3.4    In the event Escrow Agent receives an Objection Notice within the ten
(10) Business Day period noted in Section 2.3.1, Escrow Agent may, at its
option, (a) continue to hold the Claim Amount subject to the Disbursement
Request until such time as Seller and Buyer resolve their dispute and issue
joint written instructions relative to disbursement of the Claim Amount, or (b)
if such dispute has not been resolved within ninety (90) days after Escrow
Agent’s receipt of the subject Disbursement Request, bring a suit in
interpleader in a court of competent jurisdiction naming the parties to this
Escrow Agreement and any other parties as may be appropriate in the opinion of
Escrow Agent. Upon filing of said suit and placing of the Claim Amount subject
to the Disbursement Request in the registry of the court, Escrow Agent shall
have the right to withdraw from said suit and all obligations of Escrow Agent
with respect to, but only with respect to, such Claim Amount shall cease and
terminate.
2.3.5    This Escrow Agreement shall terminate upon the disbursement by Escrow
Agent of all of the Escrow Funds in accordance with this Escrow Agreement and
Escrow Agent shall thereupon be discharged.
Article III    
LIABILITY OF ESCROW AGENT
3.1    Liability of Escrow Agent. Escrow Agent shall have no liability or
obligation with respect to the Escrow Funds except for Escrow Agent’s willful
misconduct or gross negligence. Escrow Agent’s sole responsibility shall be for
the safekeeping, and disbursement of the Escrow Funds in accordance with the
terms of this Escrow Agreement. Escrow Agent shall have no implied duties or
obligations and shall not be charged with knowledge or notice of any fact or
circumstance not specifically set forth herein. Escrow Agent may rely upon any
instrument, not only as to its due execution, validity and effectiveness, but
also as to the truth and accuracy of any information contained therein, which
Escrow Agent shall in good faith believe to be genuine, to have been signed or
presented by the person or parties purporting to sign the same and to conform to
the provisions of this Escrow Agreement. In no event shall Escrow Agent be
liable for incidental, indirect, special, consequential or punitive damages.
Escrow Agent shall not be obligated to take any legal action or commence any
proceeding in connection with the Escrow Funds, any account in which Escrow
Funds is deposited, this Escrow Agreement or the Purchase Agreement, or to
appear in, prosecute or defend any such legal action or proceeding.
3.2    Authorization of Escrow Agent. The Escrow Agent is authorized and
instructed to comply with orders issued or process entered by any court with
respect to the Escrow Funds, without determination by the Escrow Agent of such
court’s jurisdiction in the matter. If any portion of the Escrow Funds is at any
time attached, garnished or levied upon under any court order, or in case the
payment, assignment, transfer, conveyance or delivery of any such property shall
be stayed or enjoined by any court order, or in case any order, judgment or
decree shall be made or entered by any court affecting such property or any part
thereof, then and in any such event, the Escrow Agent is authorized, in its sole
discretion, to rely upon and comply with any such order, writ, judgment or

Exhibit I – Page 3
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decree which it is advised by legal counsel selected by it is binding upon it
without the need for appeal or other action; and if the Escrow Agent complies
with any such order, writ, judgment or decree, it shall not be liable to any of
the parties hereto or to any other person or entity by reason of such compliance
even though such order, writ, judgment or decree may be subsequently reversed,
modified, annulled, set aside or vacated.
3.3    Indemnification of Escrow Agent. Seller and Buyer hereby agree jointly
and severally to indemnify and hold harmless the Escrow Agent and its directors,
officers and employees from and against any and all losses, liabilities,
expenses, claims and demands (including reasonable attorneys’ fees and expenses)
arising out of or in connection with the performance of the Escrow Agent’s
obligations in accordance with the provisions of this Escrow Agreement, except
for the Escrow Agent’s own gross negligence or willful misconduct. The
obligations of Buyer and Seller under this Section shall survive any termination
of this Escrow Agreement.
Article IV    
MISCELLANEOUS
4.1    Assignment; Successors and Assigns; Third Parties. Except as otherwise
provided herein, neither Buyer nor Seller shall convey, assign or otherwise
transfer any of its rights or obligations under this Escrow Agreement without
the express written consent of the other party. Any conveyance, assignment or
other transfer of any of Escrow Agent’s rights and obligations under this Escrow
Agreement shall require express written consent of both Buyer and Seller. This
Escrow Agreement shall be binding upon and shall inure to the benefit of the
parties hereto and their respective successors and permitted assigns. This
Escrow Agreement is not intended to benefit, and shall not run to the benefit of
or be enforceable by, any other person or entity other than the parties hereto
and their successors and permitted assigns.
4.2    Tax Reporting. Seller and Buyer agree that, for tax reporting purposes,
all interest or other income earned from the investment of the Escrow Funds in
any tax year shall (a) to the extent such interest or other income is
distributed by the Escrow Agent to any person or entity pursuant to the terms of
this Escrow Agreement during such tax year, be reported as allocated to such
person or entity, and (b) otherwise shall be reported as allocated to Seller.
4.3    Entire Agreement. This Escrow Agreement and the Purchase Agreement set
forth all of the promises, covenants, agreements, conditions and undertakings
between the parties hereto with respect to the subject matter hereof and
supersede all prior or contemporaneous agreements and understandings,
negotiations, inducements or conditions, express or implied, oral or written. In
the event of any direct conflict of the terms of this Escrow Agreement with the
terms of the Purchase Agreement, the terms of the Purchase Agreement shall
control and prevail.
4.4    Severability. If a provision of this Escrow Agreement is deemed to be
contrary to law, that provision will be deemed separable from the remaining
provisions of this Escrow Agreement, and will not affect the validity,
interpretation or effect of the other provisions of either this Escrow Agreement
or any agreement executed pursuant to it or the application of that provision to
other circumstances not contrary to law.

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4.5    Notices. All notices that are required or permitted hereunder shall be in
writing and shall be sufficient if personally delivered or sent by registered or
certified mail, facsimile message, email or Federal Express or other nationally
recognized overnight delivery service. Any notice shall be deemed given upon the
earlier of the date when received at, or the third day after the date when sent
by registered or certified mail or the day after the date when sent by Federal
Express or the day of when sent by facsimile to, the address or facsimile number
set forth below, unless such address or facsimile number is changed by written
notice to the other parties in accordance with this Escrow Agreement:
If to Seller:

                    
                    
                    
                    

Copy to:

                    
                    
                    
                    

If to Buyer:             

c/o Ashford Hospitality Prime Limited Partnership
14185 Dallas Parkway, Suite 1100
Dallas, Texas 75254
Attention: David Brooks
Facsimile: (972) 490-9605

Copy to:        

Gardere Wynne Sewell LLP
2021 McKinney Avenue, Suite 1600
Dallas, Texas 75201
Attention: Cynthia Nelson
Facsimile: (214) 999-3884

If to Escrow Agent:

Chicago Title Insurance Company
711 Third Avenue, 5th Floor

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New York, New York 10017
Attention: Sie Cheung
Facsimile: (212) 880-1400

4.6    Expenses. Except as otherwise provided for herein, each party shall be
responsible for its own costs and expenses with respect to matters involving
this Escrow Agreement.
4.7    Governing Law. This Escrow Agreement shall be governed by and construed
in accordance with the laws of the State of California.
4.8    Execution Counterparts. This Escrow Agreement may be executed in
two (2) or more counterparts, each of which shall be deemed to be an original
but all of which together shall be deemed to be one and the same instrument.
4.9    Captions. The captions herein are included for convenience of reference
only and shall be ignored in the construction and interpretation hereof.
4.10    Attorneys’ Fees. If any legal action is brought for the enforcement of
this Escrow Agreement, the successful or prevailing party shall be entitled to
recover reasonable attorneys’ fees and other costs incurred in that action or
proceeding (together with costs of enforcing any judgments or rulings), in
addition to any other relief to which it may be entitled. In all other matters
arising hereunder, each party shall bear its own attorneys’ fees.
4.11    Further Assurances. Each party hereto, at the reasonable request of
another party hereto, shall execute and deliver such other instruments and do
and perform such other acts and things as may be necessary or desirable for
effecting completely the consummation of this Escrow Agreement and the
transactions contemplated hereby.
4.12    Recitals Incorporated. The foregoing recitals are hereby incorporated
within and made an integral part of this Escrow Agreement as if fully set forth
herein.
4.13    No Waiver. No failure on the part of Buyer or Seller at any time to
require the performance by the other of any provision of this Escrow Agreement
shall in any way affect the party’s rights to require such performance, nor
shall any waiver by any party of any provision hereof be taken or held to be a
waiver of any other provision hereof.

[SIGNATURE PAGE FOLLOWS]

Exhibit I – Page 6
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IN WITNESS WHEREOF, each of the parties hereto has caused this Escrow Agreement
to be executed on its behalf as of the day and year first above written.
ESCROW AGENT:

CHICAGO TITLE INSURANCE COMPANY:

By:____________________________
[Name]
[Title]

SELLER:

                    
                    
                    
                        
    

BUYER:
                    
                    
                    
                    

Exhibit I – Page 7
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EXHIBIT 3.6
CARVE OUTS TO REPRESENTATIONS

During 2016 the Town of Yountville determined that Seller had violated one of
its conditions of approval by allowing Hotel guests to utilize, on a shared
basis, the fitness room in the Hopper Creek Apartments. Subsequently, the Town
approved the construction of a new Fitness Center on the Hotel property and
Seller is in process of constructing such facility and shall bear the expense of
such construction.
Recently, the Town of Yountville delivered to Seller a notice of an intended
“Audit’ of Seller’s compliance with its Use Permit Conditions of Approval as
part of a standard Town-wide compliance Audit. No such Audit has yet occurred so
Seller has no knowledge of any potential compliance issues other than the need
to update its Management Parking information.
Seller has received approval to open up its spa, restaurant, and bar to the
public. Such approval requires the construction of a new parking lot on
Town-owned land on Washington Street. An agreement with the Town regarding that
construction has been negotiated, but not yet executed pending Seller’s
determination of the costs of the construction of such parking lot.

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EXHIBIT 6.9A
CONSTRUCTION CONTRACTS

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EXHIBIT 6.9B
SCOPE OF WORK

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SCHEDULE 1
AUTHORIZATIONS

Schedule 1 – Page 1
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SCHEDULE 2

OPERATING AGREEMENTS

Schedule 2 – Page 1
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SCHEDULE 3

EMPLOYMENT AGREEMENTS

Schedule 3 – Page 1
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SCHEDULE 4

OCCUPANCY AGREEMENTS

Schedule 4 – Page 1
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SCHEDULE 5

OFF-SITE FACILITY AGREEMENTS

Schedule 5 – Page 1
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SCHEDULE 6

RESTRICTED EMPLOYMENT AGREEMENTS

Schedule 6 – Page 1
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