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A6522 - MIGGY'S CANTINA, LLC - MAJOR NEED-BASED ASSISTANCE FOR RENOVATING MAJOR VACANCIES AS CATALYST PROJECTS GRANT
DOC # 2014-0265195 07/17/2014 08:52A Fee:NC Page 1 of 33 Recorded in Official Records ` County of Riverside Larry W. Ward Assessor, County Clerk 8 Recorder y RECORDINGCI OFALM SPRINGS II II IIII II I III IIII III III III II IIII City of Palm Springs City Clerk S R U PAGE SIZE DA MISC LONG RFD I COPY P O Box 2743 Palm Springs, CA 92263 EXAM M A L 465 426 PCOR NCOR SMF N HG V 06 T: CTY UNI Filing ee EXEMPT per Government Code 6103 A6522 C 808 Grant Agreement - Miggy's Cantina THIS AREA FOR RECORDER'S USE ONLY THIS PAGE ADDED TO PROVIDE ADEQUATE SPACE FOR RECORDING INFORMATION ($3.00 Additional Recording Fee Applies) FQpAMs c " COMMERCIAL - RETAIL MAJOR "NEED-BASED" ASSISTANCE FOR Cq<<FORN�p RENOVATING MAJOR VACANCIES AS CATALYST PROJECTS GRANT AGREEMENT - t'`1��p�5 �a ✓�l THIS Rj NOVATING MAJOR VACANCIES (the "Agreement") is made and entered into this \0W day of JVyal , 2014, by and between the City of Palm Springs, ("City"), and Miggys Cantina, LLC, the ("Tenant"). Collectively the City and Tenant are referred to as the Parties. RECITALS City has established a Major Need-Based Catalyst Vacancy Program for Owners and Tenants of commercial-retail businesses in the City of Palm Springs. Miggys Cantina, LLC ("Tenant") is a tenant of a 8,000 square foot commercial space located within the eligible area at 1555 South Palm Canyon Drive, Palm Springs, California 92264 ("Property"), otherwise known as Hacienda Cantina. The Property is owned by Wessman Holdings ("Owner"), of Palm Springs, California. Owner has provided its consent to the Tenant for the property improvements and for the Tenant's application for incentive funding. Grant Criteria. In order to receive the maximum amount under the program, a building, cluster of buildings or single space must be at least 8,000 s/f. Tenant proposed an expenditure of at least $1,000,000 — excluding the acquisition of the property. Tenant has approved renovation plans and completed all work necessary for the renovation, and underwent a pro forma analysis by the City. City Investment. Under the Major Need-Based Catalyst Vacancy Program, the maximum dollars per building square foot committed by the City is $30/s/f., which is reserved for high potential dollars-per-square-foot projects projected to produce significant revenue for the City through sales taxes, property taxes and other revenue. Leverage. Under the Major Need-Based Catalyst Vacancy Program, the applicant (Owner or Tenant) must spend $3.00 for each $1.00 committed by the City, which is higher than other incentive programs offered by the City, which typically require a 1:1 match. Grant Maximums. The maximum City matching grant under the Major Need-Based Catalyst Vacancy Program shall not exceed $250,000, i.e. if the applicant's interior 1 IIII II III III II I IIIIIIIII IIII IIIIIIII II NI46 07 I 0 14 5^cR of 3319 .improvement cost is $1 ,000,000, the City Match Grant would be $250,000, provided it did not exceed $30.00/s/f. Tenant has applied for a Grant in the amount of $250,000 to make interior improvements to the Property as described in Exhibit "B," Scope of Work. The City has confirmed that the Property is a vacant space in a building constructed at least thirty years ago and has been vacant for more than five years, and that the conversion of the very large (8,000 square foot) space, with a 3,000 square foot kitchen, into a functioning business would not have been economically feasible without an incentive program. The City has determined that, in addition to the high cost of converting the oversized space into a functioning business, the location (Exhibit "A") of the business on a section of South Palm Canyon Drive which has suffered from a high level of vacancies, presents an additional measure of risk to investors, making it additionally economically marginal without an incentive program. Tenant has received all necessary approvals from the City's Planning, Building and Engineering Departments, which are shown in Exhibit "C", Evidence of Approval. The estimated cost of the work proposed is $1 ,500,000, as shown in Exhibit "D". Tenant has substantially completed the construction of the project and will receive sign off from the City's Planning and Building and from Riverside County Department of Environmental Health. The City has reviewed the application, the evidence of financial participation by Tenant, the location of the Property, and the approvals, and has approved the Grant Application. NOW, THEREFORE, in consideration of the promises and mutual agreements contained herein, City agrees to grant to Tenant the amount of $250,000 and Tenant agrees to complete the approved improvements, if necessary, and operate the business under the following terms and conditions: AGREEMENT 1 . Property Ownership/Right to Undertake Work. Tenant represents that it holds Tenancy in the Property, which entitles it to undertake interior physical improvements to the Property and has consent of the landlord to perform such work. 2. Form of City Assistance. The Program assistance authorized by this Agreement shall be in the form of a grant to an eligible business, secured by a Promissory Note (Note) that is amortized each year of the three year Compliance Period. Such Note terms shall include the right of the City to place a lien against the business' (Tenant's) interest in the affected property and may include 2 IIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIII 0729I3b 460895eR repayment provisions that do not require monetary repayment upon business performance meeting defined criteria. a. The City and the eligible business shall enter a written agreement detailing the responsibilities of both parties, including but not limited to a the grant assistance by the City described in this Section, and the continued maintenance of minimum business activity and employment levels by the business; and b. The program features a "clawback" provision: the assistance will be made as a "loan" by the City to the business, but the amortization will be their continued presence and operation in the City for a specified period of time. If the company sells the business, ceases operating the business, or reduces its employment levels below the committed level, it will be required to repay the City the unamortized portion of the assistance; and C. The City may include repayment provisions that may or may not require monetary repayment, depending on the business' performance meeting criteria defined in this Section; such agreement shall be secured by a lien against the business and/or the property at which the business is located; and d. The company shall attest that the business would not have located or expanded in the City without the benefit; and e. The City shall attest that the total economic benefit to the community of the new sales tax, other taxes, and additional jobs, by its own calculations, exceeds the amount of the grant, and that the broad public benefit created by the program in terms of payroll and taxes paid exceeds the private benefit, and that there are no other reasonable alternative measures available to the business to finance the improvements or create the public benefit; and f. The agreement shall assure that the business will remain in the City for a minimum of three (3) years at the proposed business activity and employment level, or repay the City based on a straight-line amortization of the assistance; the commitment "amortizes" the City's loan to the business at a rate of 33.3% of the dollar amount of the benefit per year; and g. Prior to the first anniversary of this Agreement, a certification form shall be submitted by the tenant to the City for verification. Upon completion of the verification process the lien placed on the business will be reduced by one third of the benefit amount paid. This process will continue annually for a total of three years, starting during the 2nd year of the initial employee certification process. 3 2RI IIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIN O' 29 f63395eR 3. Required Findings for Assistance. In October, 2013, Section 53083 was added to the California Government Code. Section 53083 states that before granting an economic development subsidy, each local agency shall provide public notice and a hearing regarding the economic development subsidy. "Economic Development Subsidy" under Section 53083 means any expenditure of public funds or loss of revenue to a local agency in the amount of one hundred thousand dollars ($100,000) or more, for the purpose of stimulating economic development within the jurisdiction of a local agency, including, but not limited to: bonds, grants, loans, loan guarantees, enterprise zone or empowerment zone incentives, fee waivers, land price subsidies, matching funds, tax abatements, tax exemptions, and tax credits. The City Council, prior to approving assistance to an eligible business, must make the following findings: (1) The name and address of all business entities that are the beneficiary of the economic development subsidy: Miggy's Cantina, LLC, aka Hacienda Cantina & Beach Club, 1555 South Palm Canyon Drive, Suite B-1, Palm Springs, CA, 92264. (2) The start and end dates and schedule, if applicable, for the economic development subsidy. The subsidy shall be made after the project is approved by the City and County Department of Health, and all work completed to the City's satisfaction, and evidence of payment made, as well as evidence of at least a 3:1 match of private funds to City dollars. In this case the work has been completed and approved and the restaurant has opened. The project shall have a three (3) year Compliance Period. (3) A description of the economic development subsidy, including the estimated total amount of the expenditure of public funds by, or of revenue lost to, the local agency as a result of the economic development subsidy. The subsidy is in the amount of $250,000 to make interior and exterior improvements to the Property in order to renovate the existing restaurant into a large restaurant and club with a pool component. The assistance authorized by this Agreement shall be in the form of a grant to the eligible business described in Section 2 of this Agreement. (4) A statement of the public purposes for the economic development subsidy. The City has confirmed that the Property was a vacant space in a building constructed at least 25 years ago and had has been vacant more than four years, and that the conversion of the very large space into a functioning business would not have been economically feasible without an incentive program. Additionally, the City has determined that, in addition to the high cost of converting the restaurant into a functioning business, the location of the business outside the downtown and in a relatively 4 I III II III III III I II IIIIII 111111111111111111111 07�01 5�f 3395[R economically depressed section of Palm Canyon Drive, presents an additional measure of risk to investors, making it additionally economically marginal without an incentive program. However, the financial strength and deep experience of the applicants mitigates the risk factors and makes the incentive a positive for the restaurant, the surrounding development, the neighborhood and adjacent businesses. (5) Projected tax revenue to the local agency as a result of the economic development subsidy. Over the next ten years the City expects to receive at least $500,000 in direct property taxes, plus its allocated share of increased property tax. The project will also help act as a catalyst for future development in its area, thereby increasing property tax to the City as well. (6) Estimated number of jobs created by the economic development subsidy, broken down by full-time, part-time, and temporary positions. The restaurant expects to create 88 total jobs, with 10 full time jobs and 78 part time jobs. 4. Schedule. The Parties agree that all interior improvements shall be completed within 90 days of the date of this Agreement. 5. Term. The obligations to the City by the Tenant under this Agreement shall remain in place for a period of three (3) years from the date of the agreement first above written, unless extended by mutual agreement of the parties. Following termination, Tenant shall have no obligation hereunder. 6. Contractor. The Parties agree that Tenant has sole responsibility for choosing and hiring the contractor, which shall be shown in Exhibit "D", Contra ctorNendo r Agreements, and the acceptance of the material used and the work performed is Tenant's responsibility, and the City is not a party to any agreement with the vendor or contractor and does not guarantee the quality of workmanship of the property improvements, nor have any liability whatsoever therefor. At all times hereunder, the Contractor shall have a valid Contractor's License from the State of California and a valid City of Palm Springs Business License. Contractor may be a payee for a portion of the grant reimbursement. 7. Design Approval and Permits. The Parties agree that Tenant has sole responsibility for obtaining design approval and evidence of required permit approvals from the City of Palm Springs as shown in Exhibit "C", and ensuring the compliance with those permits. 8. Grant Limitations. The maximum City matching grant shall not exceed $250,000, which is the 8,125 square feet of the building space multiplied by the maximum $30/s/f of City contribution. The estimated cost of the work proposed 5 IIIII III I I I IIIII III III I IIIII III II I I IIII 61 201 20 4 @8952R is $1 ,500,000, as shown in Exhibit "D". The leverage is $7.75 of Tenant dollars for each $1.00 of City dollars. The Grant is secured by a Promissory Note (shown in Exhibit "E") entered into by the Tenant for the amount of the Grant, which shall be reduced annually by one-third over the three year Compliance Period, after the City certifies a Certificate of Continuing Compliance (shown in Exhibit G.) City liens are subordinate, as described below in Section 9D. 9. Evidence of Completion. The Parties agree that the City will release the Grant funds upon the completion of the work by the Tenant or his contractor. Evidence of completion shall include but is not limited to: photographs of the finished work; a final inspection by a representative of the City of Palm Springs; and, a copy of the final invoice for the work completed and proof of payment to the contractor. 10. Release of Contractor Liens. The Parties Agree that the Tenant is responsible for obtaining the release of any Mechanics Liens or other liens placed upon Tenant's property by any contractor or subcontractor hired under this program. If the Contractor is the payee for any portion of the work, a full release of Mechanic's Liens or other contractor liens shall be exchanged and released simultaneously with the payment for the City. 11. Maintenance. Tenant, for itself and its successors and assigns, hereby covenants and agrees to maintain and repair or cause to be maintained and repaired the Property and all related on-site improvements and landscaping thereon, including, without limitation, buildings, parking areas, lighting, signs and walls in a first class condition and repair, free of rubbish, debris and other hazards to persons using the same, and in accordance with all applicable laws, rules, ordinances and regulations of all federal, state, and local bodies and agencies having jurisdiction, at Tenant's sole cost and expense. Such maintenance and repair shall include, but not be limited to, the following: (i) sweeping and trash removal; (ii) the care and replacement of all shrubbery, plantings, and other landscaping in a healthy condition; and (iii) the repair, replacement and restriping of asphalt or concrete paving using the same type of material originally installed, to the end that such pavings at all times be kept in a level and smooth condition. In addition, Tenant shall be required to maintain the Property in such a manner as to avoid the reasonable determination of a duly authorized official of the City that a public nuisance has been created by the absence of adequate maintenance such as to be detrimental to the public health, safety or general welfare or that such a condition of deterioration or disrepair causes appreciable harm or is materially detrimental to property or improvements within one hundred (100) feet of such portion of the Site. a. Parking and Driveways. The driveways and traffic aisles on the Site shall be kept clear and unobstructed at all times. No vehicles or other obstruction shall project into any of such driveways or traffic aisles. Vehicles associated with the operation of the Property, including delivery vehicles, vehicles of employees and vehicles of persons with business on the Property shall park solely on the Property. 6 IIIIII IIIIIII III IIIIII(IIII 111111111111111111111111111 07 17/ 06 of 8 52H b. Right of Entrv. In the event Tenant fails to maintain the Site in the above- mentioned condition, and satisfactory progress is not made in correcting the condition within thirty (30) days from the date of written notice from City, City may, at its option, and without further notice to Tenant, declare the unperformed maintenance to constitute a public nuisance. Thereafter, the City, its employees, contractors or agents, may cure Tenant's default by entering upon the Site (Property) and performing the necessary landscaping and/or maintenance. The City shall give Tenant, its representative or manager reasonable notice of the time and manner of entry, and entry shall only be at such times and in such manner as is reasonably necessary to carry out this Agreement. Tenant shall pay such costs as are reasonably incurred by City for such maintenance, including attorneys' fees and costs. C. Reimbursement of Costs. If such costs are not reimbursed within thirty (30) days after Tenant's receipt of notice thereof, the same shall be deemed delinquent, and the amount thereof shall bear interest thereafter at a rate of the lower of ten percent (10%) per annum or the legal maximum until paid. Any and all delinquent amounts, together with said interest, costs and reasonable attorney's fees, shall be an obligation of Tenant as well as a lien and charge, with power of sale, upon the property interests of Tenant, and the rents, issues and profits of such property. City may bring an action at law against Tenant obligated to pay any such sums or foreclose the lien against Tenant's property interests. d. City Liens Are Subordinate. Any monetary lien provided for herein shall be subordinate to any bona fide mortgage or deed of trust covering an ownership interest or leasehold or subleasehold estate in and to any Property approved by City pursuant to this Agreement, and any purchaser at any foreclosure or trustee's sale (as well as any deed or assignment in lieu of foreclosure or trustee's sale) under any such mortgage or deed of trust shall take title free from any such monetary lien, but otherwise subject to the provisions hereof; provided that, after the foreclosure of any such mortgage and/or deed of trust, all other assessments provided for herein to the extent they relate to the expenses incurred subsequent to such foreclosure, assessed hereunder to the purchaser at the foreclosure sale, as owner of the subject Site after the date of such foreclosure sale, shall become a lien upon such Property upon recordation of a Notice of Assessment or Notice of Claim of Lien as herein provided. 7 III Illlllllll IIIII IuII III III IIIIIII II III EAI 9 ©&7 52R 8 f 33 •12. Obligations Upon Sale or Transfer a. City Approval of Transfer Required. For a period of three (3) years after the date of this Agreement, Tenant shall not Transfer the Property or any of Tenant's rights hereunder, or any interest in the Site or in the improvements thereon, directly or indirectly, voluntarily or by operation of law, except as provided below, without the prior written approval of City, and if so purported to be Transferred, the same shall be null and void. In considering whether it will grant approval of any Transfer by Tenant of its interest in the Site, City shall consider factors such as (i) the financial credit, strength, and capability of the proposed transferee to perform Tenant's obligations hereunder; and (ii) the proposed transferee's experience and expertise in the operation, financing, development, ownership, and operation of similar businesses . b. Written Agreement Required. In the absence of specific written agreement by City, no transfer by Tenant of all or any portion of its interest in the Site (including without limitation a transfer not requiring City approval hereunder) shall be deemed to relieve it or any successor party from the obligation to continue to operate the business or any other obligations under this Agreement. In addition, no attempted transfer of any of Tenant's obligations hereunder shall be effective unless and until the successor party executes and delivers to City an assumption agreement in a form approved by the City assuming such obligations. G. Exceptions. The foregoing prohibition shall not apply to any of the following: 1. Any mortgage, deed of trust, sale/lease-back, or other form of conveyance for financing, but Tenant shall notify City in advance of any such mortgage, deed of trust, or other form of conveyance for financing pertaining to the Site. 2. Any mortgage, deed of trust, sale/lease-back, or other form of conveyance for restructuring or refinancing of any amount of indebtedness described in subsection (a) above, provided that the amount of indebtedness incurred in the restructuring or refinancing does not exceed the outstanding balance on the debt incurred to finance the acquisition of the Site and construction of improvements on the Site, including any additional costs for completion of construction, whether direct or indirect, based upon the estimates of architects and/or contractors. 3. The conveyance or dedication of any portion of the site (or sites) to the City of Palm Springs or other governmental agency. 8 IIIIII III III III IIIIII III I IIIIII IIII III IIIII IIII III 07 201 f6 33 98352R 4. Any mortgage, deed of trust, sale/lease-back, or other form of conveyance for financing provided that the principal amount of the loan does not exceed eighty-five percent (85%) of the value of the land and improvements thereon. 5. The granting of easements to any appropriate governmental agency or utility to facilitate the development of the Site. 6. A sale or transfer resulting from or in connection with a reorganization as contemplated by the provisions of the Internal Revenue Code of 1986, as amended or otherwise, in which the ownership interests of a corporation are assigned directly or by operation of law to a person or persons, firm or corporation which acquires the control of the voting capital stock of such corporation or all or substantially all of the assets of such corporation. 7. A sale or transfer of forty-nine percent (49%) or more ownership interest to a member of the transferor's immediate family, a trust, testamentary or otherwise, in which immediate family members of the transferor are the sole beneficiaries, or a corporation or partnership in which the immediate family members or shareholders of the transferor have controlling majority interest of more than fifty-one percent (51%). 8. A change in the respective percentage ownership interests exclusively of the present owners of Tenant (as of the date of this Agreement), but this shall not authorize the transfer of any interest to any person or entity who is not a present Tenant of Tenant. 9. Mechanic's liens removed prior to foreclosure or liens for current year property taxes not paid. 13. Enforcement. In the event Tenant defaults in the performance or observance of any covenant, agreement or obligation of Tenant pursuant to this Agreement, and if such default remains uncured for a period of thirty (30) days after written notice thereof shall have been given by City, or, in the event said default cannot be cured within said time period, Tenant has failed to commence to cure such default within said thirty (30) days and thereafter fails to diligently prosecute said cure to completion, then City shall declare an "Event of Default" to have occurred hereunder, and, at its option, may take one or more of the following steps: a. By mandamus or other suit, action or proceeding at law or in equity, require Tenant to perform its obligations and covenants hereunder or enjoin any acts or things which may be unlawful or in violation of this Agreement; or 9 IIIIIIIIIIIIIIIIIII IIIII IIIII II III III III a ©1zeoe33 10 u£ 33 b. Take such other action at law or in equity as may appear necessary or desirable to enforce the obligations, covenants and agreements of Tenant hereunder; or Except as otherwise expressly stated in this Agreement, the rights and remedies of the parties are cumulative, and the exercise by any party of one or more of its rights or remedies shall not preclude the exercise by it, at the same or different times, of any other rights or remedies for the same default or any other default by another party. MISCELLANEOUS PROVISIONS 14. Covenant Against Discrimination. Tenant covenants that, by and for itself, its heirs, executors, assigns, and all persons claiming under or through them, that there shall be no discrimination or segregation in the performance of or in connection with this Agreement regarding any person or group of persons on account of race, color, creed, religion, sex, marital status, disability, sexual orientation, national origin, or ancestry. 15. Notice. Any notice, demand, request, consent, approval, or communication either party desires or is required to give to the other party or any other person shall be in writing and either served personally or sent by pre-paid, first-class mail to the address set forth below. Either party may change its address by notifying the other party of the change of address in writing. Notice shall be deemed communicated seventy-two (72) hours from the time of mailing if mailed as provided in this Section. To City: City of Palm Springs 3200 E. Tahquitz Canyon Way Palm Springs, California 92262 Attn: Economic Development Administrator To Tenant: Miggy's Cantina, LLC 700 East Tahquitz Canyon Way, Suite A Palm Springs, California 92262 Attn: Rich Meaney 16. Integrated Agreement. This Agreement contains all of the agreements of the parties and cannot be amended or modified except by written agreement. 17. Amendment. This Agreement may be amended at any time by the mutual consent of the parties by an instrument in writing. 18. Severability. In the event that any one or more of the phrases, sentences, clauses, paragraphs, or sections contained in this Agreement shall be declared invalid or unenforceable by valid judgment or decree of a court of competent jurisdiction, such invalidity or unenforceability shall not affect any of the remaining phrases, sentences, clauses, paragraphs, or sections of this 10 IIIIII IIIIIII III IIIIII IIIII IIIIII IIIII III HIM III 1111 07 z6t 11 4083 Agreement, which shall be interpreted to carry out the intent of the parties hereunder. 19. Indemnification. Tenant agrees for itself and its successors and assigns to indemnify, defend, and hold harmless the City of Palm Springs ("City') and the City, the City Council, its officers, agents, employees, independent contractors, members, officials, volunteers, and representatives from and against any loss, liability, claim, or judgment relating in any manner to the Project. Tenant, while in possession of the Site, and each successor or assign of Tenant while in possession of the Site, shall remain fully obligated for the payment of property taxes and assessments in connection with the Site. Tenant shall indemnify and hold harmless, the City, the City Council, its officers, agents, employees and independent contractors free and harmless from any liability whatsoever based and asserted upon any act or omission of the City for property damage, bodily injury, or death or any other element of damage of any kind or nature, relating to or in any way connected with participation in the Program. 20. Authority. The persons executing this Agreement on behalf of the parties hereto warrant that they are duly authorized to execute this Agreement on behalf of said parties and that by so executing this Agreement the parties hereto are formally bound to the provisions of this Agreement. Tenant certifies that the above statements are true and accurate to the best of Tenant's belief. Failure to meet any of the terms of this Agreement shall result in the forfeiture of any Grant funds from the City for this program. 21. Continuing Compliance. The public purpose of the Major Need-Based Catalyst Vacancy Program is to promote the development of viable businesses in major vacant commercial spaces in the incentive area, leading to expansion of good quality jobs in the City of Palm Springs. It is the responsibility of the Tenant as beneficiary under this Agreement to ensure the cooperation and compliance of the ongoing obligations under the program, including submitting a Certificate of Program Compliance (Exhibit "F") to the City for a period of three years from the anniversary date of this agreement. If the Tenant (1) transfers the Property during the compliance period without prior consent of the City, (2) ceases operation of the Business during the Compliance Period, or (3) fails to provide the City with the initial or any of the annual Certificates of Continuing Program Compliance certifying that they remain in business and continue to operate and employ workers in the business, to be provided to City each year during the three year compliance period, the City may seek repayment of the "unamortized" portion of the Grant from the Tenant under the terms below. The City shall have complete and absolute discretion in determining whether lack of program compliance is cause for termination. 22. Recordation. The City Clerk shall record this Agreement and the Promissory Note in the Official Records of the County of Riverside, California. 11 IIIIII IIIIII III IIIIII IIIII IIIIII IIIII III IIIIII III IIII 0?/01 12 o 6852E 9 SIGNATURES ON NEXT PAGE THIS PAGE IS LEFT INTENTIONALLY BLANK 12 IIIIII 01111111111111111111111111 a1111111111 IIII C1. ?©1 20 4 6)8952A IN WITNESS WHEREOF, the parties have executed this Agreement as of the dates stated below. "City" // City of Palm Spring�s Date: f0 //(�f By: * f'(/v ommunit & Economic Development Cathy Va Horn Date: 6-roAk By: (�erectq r r(�unit) Economic Development , 11 John Raymond J a J Z6 +�Y y Date: B : � APPROVED BY C David H. Ready, Esq. I� f� o as City Manager ATTEST: rJ APPROV AS TO FORM: By: I ames Thompson Doug la . Holland City Clerk City Att mey "TENANT" f Date: Ll— / I By: Ri Meaney President Miggyis Cantina, .LLC a California limited liability corpor- Date: By: ation 13 III II III III II I II IIIII III II III I II e, 20I4 0 14 of 33 2P ACKNOWLEDGMENT OF INSTRUMENT (Cal. Civil Code Section 1181) State of California ) County of Riverside ) ss. City of Palm Springs ) On June 10, 2014, before me, JAMES THOMPSON, CITY CLERK, CITY OF PALM SPRINGS, CALIFORNIA, personally appeared DAVID H. READY, who I personally know is the CITY MANAGER of the CITY OF PALM SPRINGS whose name is subscribed to the within instrument and acknowledged to me that he executed the same in his official and authorized capacity on behalf of the City of Palm Springs, a California Charter City. 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 the official seal of the City of Palm Springs, California, this 10th day of June, 2014. 4�pp`MSAR c u w 4 r R M1CUry01AiE0 E' A Signature: ` ".` '`� � r cq<IFOR��P MES THOMPSON, CITY CLERK City of Palm Springs, California Title or Type of Document Grant Agreement— Miggy's Cantina — A6522 111111 II 111111111 11111111111 II 11111111 II 07:?@7115 of 3932F ACKNOWLEDGMENT State of California f ) County of 1�j�lefS1C21 On—�'� , before me, ^ (�, , � p,(ireert name of notary) Notary Public,personally appeared I cjr) �"tC4.Lre�-1 who proved to me on the basis of satisfactory evidence to be ersonfA whose name((464/v e subscribed to the within instrument and acknowledged to me thadei sl ey executed the same irXj1]i§2seritke4r authorized capacity(i"s and that by&herAheir signaturegon the instrument the persong,,or the entity upon behalf of which the person(4 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. "aa"`"""y K.MAMMA amCOMM.01931045 CALFORWI WITNESS my hand and official-geal. SAR��PUBW 10 C=nW= APR 1 1015 Signature4 (Seal) ACKNOWLEDGMENT State of California ) County of ) On before me, (insert name of iwtm) Notary Public,personally appeared who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies),and that by his/her/their signature(s)on the instrument the person(s),or the entity upon behalf of which the person(s)acted,executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. Signature (Seal) 14 IIIIIIIIIIIIII IIIIIIIIIII III III III III II © n01 z16 e oe33 EXHIBIT"A" Business Location: 1555 South Palm Canyon Drive Palm Springs, CA 92262-8341 APN: 513-300-038 E % E'/2 SE '/< SEC.2234S R4E 15 1111111111111111111111 97�A� 20 4698952E 17 0£ 33 EXHIBIT "B" SCOPE OF WORK Site and Exterior • Construct temporary fence (PM-10 Fence) around the job site. • Demo curb gutter, parking lot lights, palm trees. • Install new curb and gutter around the perimeter of the project • Relocate 5 olive trees to area between building and pool. • Undertake AC parking lot repairs. • Rough and finish grading: over-excavate for each building. • Install storm drain per precise grade plan • Install finish grade landscaping per landscape plan Pool and Pool Deck • Install foundations for Palapa, cabanas and bathrooms. • Install pool, pool equipment, dry well, and patio deck. • Construct masonry walls, planters, cabanas and bathrooms. • Install steel structures: fencing, gates and handrails in bath house, bar, Cabanas and overhead doors for Palapa bar. • Complete finish carpentry for bathroom: Lockers, doorjamb and hardware, Partitions and grab bars. • Complete rough carpentry on Palapa bar and cabanas (burnt cedar). Utility Work • Replace new main SCE line for the existing building and outside area and new 1200 amp panel. Electrical includes all electrical to each building. • Repair, upgrade and install interior and exterior plumbing including gas, sewer and water tie-ins. Exterior and Interior Work • Install AV and sound for cabanas and Palapa bar. • Paint inside and outside, including all fence and steel and floor. • Install drywall and FRP at inside of bar. Repair other drywall throughout. • Install counter tops for Palapa bar, bathrooms and cabanas. • Install stainless steel fixtures (interior and exterior). • Install bar equipment (interior and exterior) including glass shelving. • Install tile throughout. • Install artwork including metal work • Construct booths and banquettes 16 III II I I III III I II IIIII IIII II II III III 07 20118 of 33 EXHIBIT "C" EVIDENCE OF APPROVAL (PLANNING, BUILDING, AND/OR ENGINEERING DEPARTMENT APPROVALS) Building permit required on all or a portion of the work described in Exhibit "B" Scope of Work: Yes X No If yes, Building Permit No.: 2014-1076; 2014-482; 2014-902; 2014-30 17 IIIIII IIIIII)III IIIIII IIIII IIIIII IIIII III IIIIII III IIII 07/1ei 2014 03 52FI p'PIMe City of Palm Springs BUILDING PERMIT rrqu Building Address: 1555 Palm Canyon Dr S MASTER Date 04/08f2014 Case No. 3.1111 Permit AngelaLaFrance Submitted Technician Owner Address Phone Rich Meaney 1555 S Palm Canyon or 760 322 8804 Palm Springs CA Contractor Address Phone Lic.Number Wessman Development 555 S Sunrise Way Ste 555 760 325 3050 213720 Palm Springs CA Architect Address Phone S Engineer Address Phone m nM 0M tivo Lot# Block# Tract Parcel Number 'a mm 7 + + 513.300.038 7 U Lot Size Zone Occupancy m Building Sq.Ft. Garage/Carport Roofed Patio/Porch Remodeled Area Use of building Permit Type Const.Type Fixture Units Commercial Wallstrences Fire Sprinkler Units Valuation Permit Fees Paid 3500.00 154.33 Describe work in detail: � Construct trash enclosure. r.� Special Conditions: NOTICE:Wall and fence heights are to be measured thusly:in front yards or side yards that abut streets from crown of street or top of curb,whichever is higher. Side or rear yards not abutting streets from surrounding grade Adjacent properties with elevation differentials-from the average midpoint of the elevation difference at the property line. No exceptions unless prior approval is obtained from the Planning Dept. DO NOT CONCEAL OR COVER ANY CONSTRUCTION UNTIL THE WORK IS INSPECTED IMPORTANT The issuance of this permit shall not be held to be an approval of the violation of any provisions of any City or county ordinance or state law. Inspections of work are subject to an approved set of plans being on the job. Changes to plans are not to be made without permission of the Building and Safety Divisions. The owner and/or contractor is responsible for establishing all property lines. All utilities must be underground. This permit will expire if work is not started in 180 days or if more than 180 days elapses between Inspections. I certify that I am familiarwith all requirements of the City of Palm Springs as they apply to this permit and understand thatthese requirements must be completed prior to final inspection and that no certification of occupancy will be issued until such time as these requirements are met. I certify that I have read this application and state that the information is true and correct. OWNER/CONTRACTOR/AGENT DATE ISSUED BY Finaled This is a Building when properly filled out,signed and validated,and is not transferable. PERMITNUMBER 2014-1076 LMa: City of Palm Springs BUILDING PERMIT +iaa, Building Address: 1555 Palm Canyon Dr S MASTER N a U Date Permit An ela LaFrance m°J 02l18/2014 Case No. 3.1117 9 r�.. Submitted Technician n m Owner Address Phone Rich Meaney 1555 S Palm Canyon or 760 322 8804 Palm Springs CA —_ Contractor Address Phone Lic.Number Architectural Blue CA 760-327-1533 879184 - C Palm Spirngs CA Architect Address Phone Engineer Address Phone Lot# Block# Tract Parcel Number ? + + 513-300.038 Lot Size Zone Occupancy Building Sq.Ft. Garage/Carport Roofed Patio/Porch Remodeled Area Addition Use of building Permit Type Const.Type Fixture Units Commercial New Pool/Spa Fire Sprinkler Units Valuation Permit Fees Paid 25000.00 945.14 Describe work in detail, Pursuant to Helath&Safety New commercial pool. 115920-115929. whenever a bruilding perit is issued for the remodel or modification of a single family home wiht an existing swimming pool or spa, the permit shall require that the suction outle be upgraded so as to be equipped with a approved anti-entrapment cover. Overhead conductor Clearances SHALL comply with NEC Table 680 Special Conditions, Compliance with Swimming Pool Safety Article 7 required at encapsulation ins eciton. DO NOT CONCEAL OR COVER ANY CONSTRUCTION UNTIL THE WORK IS INSPECTED IMPORTANT The issuance of this permit shall not be held to be an approval of the violation of any provisions of any city,or county ordinance or state law. Inspections of work are subject to an approved set of plans being on the job. Changes to plans are not to be made without permission of the Building and Safety Divisions. The owner and/or contractor is responsible for establishing all property lines. All utilities must be underground. This permit will expire if work is not started in 180 days or if more than 180 days elapses between inspections. I certify that I am familiar with all requirements of the City of Palm Springs as they apply to this permit and understand that these requirements must be completed prior to final inspection and that no certification of occupancy Will be issued until such time as these requirements are met. I certify that I have read this application and state that the information is true and correct. OWNER/CONTRACTOR/AGENT DATE ISSUED BY Finaled This is a Building when property filled out,signed and validated,and is not transferable. PERMITNUMBER 2014-482 :4ALMr City of Palm Springs BUILDING PERMIT sra. Building Address: 1555 S Palm Canyon Dr Unit 101-B Date 03/25/2014 Case No. Permit AlbertoGradilla Submitted Technician Owner Address Phone Miggy's Catina 700 E Tahquitz Canyon Way 949 922 8210 Palm Springs CA N Contractor Address Phone Lic.Number Wessman Development 555 S Sunrise Way Ste 555 760 325 3050 Palm Springs CA Architect Address Phone ©N m� r Engineer Address Phone Lot# Block# Tract Parcel Number 513-300-038 Lot Size Zone Occupancy Building Sq.Ft. Garage/Carport Roofed Patio/Porch Remodeled Area 2!!!!MT M Use of building Permit Type Const.Type Fixture Units Commercial Walls/Fences Fire Sprinkler Units Valuation Permit Fees Paid 35000.00 638.88 Describe work in detail: METE! Permit to construct appx 540'of garden walls per ORCO detail Special Conditions: NOTICE:Wall and fence heights are to be measured thusly:in front yards or side yards that abut streets from crown of street or top of curb,whichever is higher. Side or rear yards not abutting streets from surrounding grade Adjacent properties with elevation differentials-from the average midpoint of the elevation difference at the property line. No exceptions unless prior approval is obtained from the Planning Dept. DO NOT CONCEAL OR COVER ANY CONSTRUCTION UNTIL THE WORK IS INSPECTED IMPORTANT The issuance of this permit shall not be held to be an approval of the violation of any provisions of any city or county ordinance or state law. Inspections of work are subject to an approved set of plans being on the job. Changes to plans are not to be made without permission of the Building and Safety Divisions. The owner and/or contractor is responsible for establishing all property lines. All utilities must be underground. This permit will expire if work is not started in 180 days or if more than 180 days elapses between inspections. I certify that I am familiar with all requirements of the City of Palm Springs as they apply to this permit and understand that these requirements must be completed prior to final inspection and that no certification of occupancy will be issued until such time as these requirements are met. I certify that I have read this application and state that the information is true and correct. OWNE R/CONTRACTORIAG ENT DATE ISSUED BY Finaled This is a Building when property filled out,signed and validated,and is not transferable. PERMITNUMBER 2014-902 City of Palm Springs BUILDING PERMIT rsue Building Address: 1555 S Palm Canyon Dr Unit 101-B Date 0110 612 01 4 Case No.:3.1111 Pemit Angela LaFrance Submitted Technician Owner Address Phone Miggy'sCantina 700 E Tahqultz Canyon Way Ste A 949 922 8210 Palm Springs CA Contractor Address Phone Lic.Number Wessman Development 555 S Sunrise Way Ste 555 760 325 3050 213720 Palm Springs CA Architect Address Phone Sanbom Ale Engineer Address Phone GouvisEng 4400 Campus Dr 949)752-1612 Newport Beach CA N Lot# Block# Tract Parcel Number m a 513-300-038 a`o Lot Size Zone Occupancy m A-2 Assembly,restaurants,bars,banquet halls m N Building Sq.FL Garage/Carport Roofed Patio/Porch Remodeled Area New 0 0 0 0 Use of building Permit Type Const.Type Fixture Units Commercial CommerclalAdditoin/alteration VB 52 Fire Sprinkler Units Valuation Permit Pees Paid Yes 0 80000.00 3006.91 Describe work in detail: —_ Add bar, cabanas, bath houselrestrooms, block walls and site work at existing restaurant site. Special Conditions, Bar addition under 1000 SF, No TUMF fee per CVAG. Sewer connection fees of$ 15,912.00 will be paid through City's Deferral Program. DO NOT CONCEAL OR COVER ANY CONSTRUCTION UNTIL THE WORK IS INSPECTED IMPORTANT The issuance of this permit shall not be held to be an approval of the violation of any provisions of any city or county ordinance or state law. Inspections of work are subject to an approved set of plans being on the job. Changes to plans are not to be made without permission of the Building and Safety Divisions. The owner and/or contractor is responsible for establishing all property lines. All utilities must be underground. This permit will expire if work is not started in 180 days or if more than 180 days elapses between inspections. I certify that I am familiar with all requirements of the City of Palm Springs as they apply to this permit and understand that these requirements must be completed prior to final inspection and that no certification of occupancy will be issued until such time as these requirements are met. 1 certify that I have read this application and state that the information is true and correct. OWNER/CONTRACTOR/AGENT DATE ISSUED BY Finaled This is a Building when properly filled out,signed and validated,and is not transferable. PERMITNUMBER 2014-30 EXHIBIT "D" CONTRACTORNENDOR AGREEMENT 18 2�14 6e 52ezR1111 HillII 4 Hacienda TASK TOTAL COMMENTS Intenor.and.Exteriorc'C rn o' Furniture, restaurant and pool. 592,281.00 Sunkor and others Temp fence $2,730.00 PM-10 Fence around the job Demo $36,850.00 Curb Gutter,Parking lot,Lights, Palm Tree's Relocate Olive trees $5,200.00 relocate 5 olive trees Curb and gutter $12,256.00 Curb and gutter around the perimeter of the project Ac parking lot repairs $13,000.00 repair parking lot Rough and finish grading $12,825.00 over X for each buildings SCE $24,720.00 New main line for the existing building and outdide area and new 1200 amp panel Storm drain $21,700.00 Storm drain per presice grade plan Foundation $26,440.00 Palapa,cabanas and bathroom Pool $49,700.00 pool,poolequipment,drywell patio deck $30,187.00 all flat work Masonry walls $65,624.00 walls,planters,cabanas and bathrooms Steel structures Fencing,gates and hand rails $68,000.00 bath house,bar,cabanas and cabana handrails over head doors h $19,200.00 over head doors for Palapa bar Finish carpentry for bathroom 11 $6,689.00 Lockers,door,jamb and hardware, partions aridgrab bars Rough Carpentry 1 $12,000.00 burnt cedar on Palapa bar and cabanas finish grade Landscaping $69,851.00 per landscape plan 5000.00 for finish grade © Plumbing $75,590.00 includes gas,sewer and water tie-ins a Electrical $96,000.00 includes all electrical to each building' AV $25,000.00 AV for cabanas and Palapa bar °m Paint $4,000.00 all fence and steel and floor drywall $1,500.00 N FRP drywall at inside of bar $500.00 FRP at inside of bar Counter top Material $11,000.00 for palapa bar,bathrooms and cabanas Counter Labor only $6,800.00 for palapa bar,bathrooms and cabanas Stainless steel $20,000.00 Interior and exterior bar equipment $30,000.00 Interior and Exterior Sub total $726,517.00 salaries 38000 Misc Labor Liquor License 32000 Full 47 tile 20000 interior - tile labor 19000 interior Bar and Bath counters 14000 Interior and exterior Artwork 3700 inetrior dump fees 3269 POS System 42000 Interior and Exterior booths 18,500 plumbing interior 11790 Paint in and out 20169 Drywall 12150 ti cioeling 3500 Interior Electric 17615 Refrigeration repair 2500 Attorney Fees 17000 Civil Engineering 22100 Metal Work 16425 Landscape Arch 3244 =� Glass shelving 1400 AV Exterior Rat Sound 123,000 Ineterior Exterior Design fees 97,000 m Running Total on 3/17/14 $1,294,879.00 mN� 0 2 �0 U1 N D EXHIBIT E PROMISSORY NOTE $250,000 Palm Springs, California FOR VALUE RECEIVED, Miggys Cantina, LLC ("Tenant"), otherwise known as Hacienda Cantina, a California limited corporation ("Maker"), promises to pay THE CITY OF PALM SPRINGS, a California Charter City ("Holder") at 3200 E. Tahquitz Canyon Way, Palm Springs, California 92262, or at such other address as Holder may direct from time to time in writing, the sum of Two Hundred Fifty Thousand Dollars ($250,000.00) (the "Note Amount'), together with interest thereon at the rate set forth herein. All sums payable hereunder shall be payable in lawful money of the United States of America. This Promissory Note ("Performance Note") is made in connection with that certain RENOVATING MAJOR VACANCIES AS CATALYST PROJECTS GRANT AGREEMENT by and among Maker and the City of Palm Springs ("City"), dated as of \111tL l0 , 2014 (as amended the "Agreement'). The Agreement provides for a City matching grant of $250,000, calculated as no less than 8,133 square feet of the building space multiplied by the maximum $30/s/f of City contribution. The estimated cost of the work proposed is $1,500,000, as shown in Exhibit "D". The amount of the Note entered into by the Tenant for the amount of the Grant, shall be reduced annually by one-third each year over the three year Compliance Period, after the City certifies a Certificate of Continuing Compliance. City liens are subordinate, as described below. 1. Interest Rate. The Note shall not bear any interest. 2. Term. The term of this Performance Note shall be for thirty-six months. 3. Repayment. No payments are due on the Note, with the exception that the principal amount of the Note Amount shall be immediately due and payable upon (i) any default of the Agreement, which is not cured within the time set forth in Section 13 of the Agreement. 4. Prepayment of City Performance Note Amount. The purpose of the Note is to ensure Performance under the Agreement. With the exception of an event of Default described in the Agreement, Maker may not prepay to Holder the full Note Amount, at any time prior to the due date of the Note Amount without penalty. 5. Application of Payments.. In the event of a default of the Agreement, each payment made by Maker hereunder shall be credited first to interest then accrued and the remainder, if any, to principal. Interest shall cease to accrue upon principal so credited. 6. Security. This Performance Note shall be recorded against the Property in the Official Records of Riverside County. 7. Holder May Assign. Holder may, at its option, assign its right to receive payment under this Performance Note without necessity of obtaining the consent of the Maker. 8. Maker Assignment Prohibited. . In no event shall Maker assign or transfer any portion of this City Performance Note without the prior express written consent of the Holder, which consent may be given or withheld in the Holder's sole discretion. Notwithstanding the foregoing, the Maker may assign one time only its interest in this Performance Note upon prior written notice to the Holder, but without the Holder's consent, to a single purpose entity to which the Maker or its principals own a share and are part of the management structure as Managing Member or Co-Managing Member ("Permitted Transferee"). 9. Attorneys' Fees and Costs. In the event that any action is instituted with respect to this City Performance Note, the non- prevailing party promises to pay such sums as a court may fix for court costs and reasonable attorneys' fees. Holder's right to such fees shall not be limited to or by its representation by staff counsel, and such representation shall be valued at customary and reasonable rates for private sector legal services. 10. Non-Waiver. Failure or delay in giving any notice required hereunder shall not constitute a waiver of any default or late payment, nor shall it change the time for any default or payment. 11. Successors Bound. This Performance Note shall be binding upon the parties hereto and their respective heirs, successors and assigns. 12. Terms. Any terms not separately defined herein shall have the same meanings as set forth in the Agreement. 13. Non-Recourse. Notwithstanding anything to the contrary herein contained, (i) the liability of Maker shall be limited to its interest in the Site and any rents, issues, and profits arising from the Site and, in addition, with respect to any obligation to hold and apply insurance proceeds, proceeds of condemnation or other monies hereunder, any such monies received by it to the extent not so applied in accordance with the terms of this Note; (ii) no other assets of Maker shall be affected by or subject to being applied to the satisfaction of any liability which Maker may have to Holder or to another person by reason of this Note; and (iii) any judgment, order, decree or other award in favor of Holder shall be collectible only out of, or enforceable in accordance with, the terms of this Note by termination or other extinguishment of Maker's interest in 111111111111111111111111111111111111111111111111111111 97, 101 20 4 f033 the Site. Notwithstanding the foregoing, it is expressly understood and agreed that the aforesaid limitation on liability shall in no way restrict or abridge Maker's continued personal liability for: (A) fraud or willful or grossly negligent misrepresentation made by Maker in connection with this Note or any of the City Agreements; (B) misapplication of (a) proceeds of insurance and condemnation or (b) rent received by Maker under rental agreements entered into for any portion of the Site after default of the Note; (C) the retention by Maker of all advance rentals and security deposits of tenants not refunded to or forfeited by such tenants; or (D) the indemnification undertakings of Maker under the City Agreements. 14. Notices. Demands. and Communications. Formal notices, demands, and communications between Maker and Holder shall be given either by (i) personal service, (ii) delivery by reputable document delivery service such as Federal Express that provides a receipt showing date and time of delivery, or (iii) mailing in the United States mail, certified mail, postage prepaid, return receipt requested, addressed to: To Holder: The City of Palm Springs 3200 E. Tahquitz Canyon Way Palm Springs, California 92262 Attn: City Manager With a copy to: Woodruff Spradlin & Smart, LLP 555 Anton Boulevard, Suite Costa Mesa, California 92_ Attn: Douglas C. Holland, Esq. To Maker: Miggy's Cantina, LLC 700 East Tahquitz Canyon Way Palm Springs, California 92262 Attn: Rich Meaney Notices personally delivered or delivered by document delivery service shall be deemed effective upon receipt. Notices mailed shall be deemed effective on the second business day following deposit in the United States mail. Such written notices, demands, and communications shall be sent in the same manner to such other addresses as either party may from time to time designate by mail. 15. Subordination. The Holder understands that the Maker is the Operator of a Restaurant, which required construction debt and other debt instruments to IIIIIIIIIIII II IIIIIIIIIIIIIII IIIII II III 9?.1N129 of 352R be placed against the Property during the term of this Note. It is understood by Holder that the Construction Debt and Mezzanine debt is Senior to the Holder's Note, and Holder is willing to subordinate its Performance Note to the Senior Construction and Mezzanine debt. SIGNATURES ON NEXT PAGE 291 III IN 111111111 e� zG of 33 "MAKER" Miggy' antina, LLC a Calif r is limited liability corporatior BY: Date Name i h Meaney, President "HOLDER" APPROVED BY CITY COMCIL THE CITY OF PALM SPRINGS, a California Charter Ci City Manager Dcid H. [teady Date Avl\t �0 8O11� ATTEST: ity Clerk James Thompson APPROVED AS TO FORM: Zil City Atto ney Douglas Holland IIIIII IIIIIII III IIIII IIIII IIIIII IIIII III IIII IIIII IIII E720I 31 of 32 ACKNOWLEDGMENT State of California ) County of Pl\r�)de On CL0 k before me, —� (insert name of notary) Notary Public, personally appeared R(C-lq 1 lL lY 1 who proved to me on the basis of satisfactory evidence to bete ershose namekS)19are subscribed to the within instrument and acknowledged to me th4—hy4w4heyexecuted the same in&er/their authorized capacity(ies},and that b r signaturco on the instrument the persono, or the entity upon behalf of which the person�a'j 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. M LIO Eel K. MAIORCA COMM.#1931045 WITN SS my hand and&fficial seal. Now YP BEFAMMINOC F�Ywg .2==WWAF1RjX,5 + Signature I/ (Seal) ACKNOWLEDGMENT State of California ) County of ) On before me, (insert name of notary) Notary Public, personally appeared who proved to me on the basis of satisfactory evidence to be the person(s)whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s)on the instrument the person(s), or the entity upon behalf of which the person(s) acted,executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. Signature (Seal) IIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIII 2AI20 of 3 3 9 97 52R EXHIBIT "F" CERTIFICATE OF PROGRAM COMPLIANCE ,I?P.IM SA4 3200 Tahquitz Canyon Way P.O. Box 2743 Palm Springs, CA 92263 °•• 760.323.8259 •cg41FORN�P• The City of Palm Springs Employment Level Verification CERTIFICATE OF PROGRAM COMPLIANCE Company Name: The Company certifies that the information contained in the Summary attached is true and Palm Springs Address: accurate and hereby certifies that a review of the employment levels of the Company during Headquarters/Regional Mailing Address: such period and of the Company's performance under this Certificate and the documents referred to therein has been made under the Local Manager: supervision of the undersigned. Phone: Fax: By: Contact Email Date of Property Lease Expiration: Its: Date: EMPLOYMENT CERTIFICATION Period Covered from to The undersigned, , a (the "Company"), has read and is thoroughly familiar with the provisions of the Employment Levels under this Agreement and documents referred to therein executed by the owner/tenant of the Property in the City of Palm Springs where the Company is located ("Owner/Tenant") and the City of Palm Springs ("City'), as such terms are defined in Resolution No.23413 of the City of Palm Springs. As of the date of this Certificate, for the period shown above, the following number of full-time employees employed at the Company is: 88 total jobs; 10 full time and 78 part time jobs. 23 IIIIII IIIII I III IIIIII IIIII IIIIII IIIII II IIIII IIII IIII 0? 014-9265195 33 of 33 PROMISSORY NOTE $250,000 Palm Springs, California FOR VALUE RECEIVED, Miggys Cantina, LLC ("Tenant'), otherwise known as Hacienda Cantina, a California limited corporation ("Maker"), promises to pay THE CITY OF PALM SPRINGS, a California Charter City ("Holder") at 3200 E. Tahquitz Canyon Way, Palm Springs, California 92262, or at such other address as Holder may direct from time to time in writing, the sum of Two Hundred Fifty Thousand Dollars ($250,000.00) (the "Note Amount'), together with interest thereon at the rate set forth herein. All sums payable hereunder shall be payable in lawful money of the United States of America. This Promissory Note ("Performance Note") is made in connection with that certain RENOVATING MAJOR VACANCIES AS CATALYST PROJECTS GRANT AGREEMENT b and among Maker and the City of Palm Springs ("City"), dated as of by to 2014 (as amended the "Agreement'). The Agreement provides for a City matching grant of $250,000, calculated as no less than 8,133 square feet of the building space multiplied by the maximum $30/s/f of City contribution. The estimated cost of the work proposed is $1,500,000, as shown in Exhibit "D". The amount of the Note entered into by the Tenant for the amount of the Grant, shall be reduced annually by one-third each year over the three year Compliance Period, after the City certifies a Certificate of Continuing Compliance. City liens are subordinate, as described below. 1. Interest Rate. The Note shall not bear any interest. 2. Term. The term of this Performance Note shall be for thirty-six months. 3. Repayment. No payments are due on the Note, with the exception that the principal amount of the Note Amount shall be immediately due and payable upon (i) any default of the Agreement, which is not cured within the time set forth in Section 13 of the Agreement. 4. Prepayment of City Performance Note Amount. The purpose of the Note is to ensure Performance under the Agreement. With the exception of an event of Default described in the Agreement, Maker may not prepay to Holder the full Note Amount, at any time prior to the due date of the Note Amount without penalty. 5. Application of Payments.. In the event of a default of the Agreement, each payment made by Maker hereunder shall be credited first to interest then accrued and the remainder, if any, to principal. Interest shall cease to accrue upon principal so credited. 6. Security. This Performance Note shall be recorded against the Property in the Official Records of Riverside County. 7. Holder May Assign. Holder may, at its option, assign its right to receive payment under this Performance Note without necessity of obtaining the consent of the Maker. 8. Maker Assignment Prohibited. . In no event shall Maker assign or transfer any portion of this City Performance Note without the prior express written consent of the Holder, which consent may be given or withheld in the Holder's sole discretion. Notwithstanding the foregoing, the Maker may assign one time only its interest in this Performance Note upon prior written notice to the Holder, but without the Holder's consent, to a single purpose entity to which the Maker or its principals own a share and are part of the management structure as Managing Member or Co-Managing Member ("Permitted Transferee"). 9. Attorneys' Fees and Costs. In the event that any action is instituted with respect to this City Performance Note, the non- prevailing party promises to pay such sums as a court may fix for court costs and reasonable attorneys' fees. Holder's right to such fees shall not be limited to or by its representation by staff counsel, and such representation shall be valued at customary and reasonable rates for private sector legal services. 10, Non-Waiver. Failure or delay in giving any notice required hereunder shall not constitute a waiver of any default or late payment, nor shall it change the time for any default or payment. 11. Successors Bound. This Performance Note shall be binding upon the parties hereto and their respective heirs, successors and assigns. 12. Terms. Any terms not separately defined herein shall have the same meanings as set forth in the Agreement. 13. Non-Recourse. Notwithstanding anything to the contrary herein contained, (i) the liability of Maker shall be limited to its interest in the Site and any rents, issues, and profits arising from the Site and, in addition, with respect to any obligation to hold and apply insurance proceeds, proceeds of condemnation or other monies hereunder, any such monies received by it to the extent not so applied in accordance with the terms of this Note; (ii) no other assets of Maker shall be affected by or subject to being applied to the satisfaction of any liability which Maker may have to Holder or to another person by reason of this Note; and (iii) any judgment, order, decree or other award in favor of Holder shall be collectible only out of, or enforceable in accordance with, the terms of this Note by termination or other extinguishment of Maker's interest in the Site. Notwithstanding the foregoing, it is expressly understood and agreed that the aforesaid limitation on liability shall in no way restrict or abridge Maker's continued personal liability for: (A) fraud or willful or grossly negligent misrepresentation made by Maker in connection with this Note or any of the City Agreements; (B) misapplication of (a) proceeds of insurance and condemnation or (b) rent received by Maker under rental agreements entered into for any portion of the Site after default of the Note; (C) the retention by Maker of all advance rentals and security deposits of tenants not refunded to or forfeited by such tenants; or (D) the indemnification undertakings of Maker under the City Agreements. 14. Notices. Demands and Communications. Formal notices, demands, and communications between Maker and Holder shall be given either by (i) personal service, (ii) delivery by reputable document delivery service such as Federal Express that provides a receipt showing date and time of delivery, or (iii) mailing in the United States mail, certified mail, postage prepaid, return receipt requested, addressed to: To Holder: The City of Palm Springs 3200 E. Tahquitz Canyon Way Palm Springs, California 92262 Attn: City Manager With a copy to: Woodruff Spradlin & Smart, LLP 555 Anton Boulevard, Suite Costa Mesa, California 92_ Attn: Douglas C. Holland, Esq. To Maker: Miggy's Cantina, LLC 700 East Tahquitz Canyon Way Palm Springs, California 92262 Attn: Rich Meaney Notices personally delivered or delivered by document delivery service shall be deemed effective upon receipt. Notices mailed shall be deemed effective on the second business day following deposit in the United States mail. Such written notices, demands, and communications shall be sent in the same manner to such other addresses as either party may from time to time designate by mail. 15. Subordination. The Holder understands that the Maker is the Operator of a Restaurant, which required construction debt and other debt instruments to be placed against the Property during the term of this Note. It is understood by Holder that the Construction Debt and Mezzanine debt is Senior to the Holder's Note, and Holder is willing to subordinate its Performance Note to the Senior Construction and Mezzanine debt. SIGNATURES ON NEXT PAGE "MAKER" Miggy' ntina, LLC a Calif li ited liability corporatior BY: Date Name: h can , President APPROVED BY CITY COUNCIL "HOLDER" THE CITY OF PALM SPRINGS, a California Charter City City Manager Date . QVL 1u 3C4 ATTEST: ity Clerk r APPROVED AS TO FORM: d/� 4a City Att mey ACKNOWLEDGMENT State of California ) County of 'Ri�fySlc ) On before me,k- Mo acd �I �I — _ �(msert name of notary) Notary Public, personally appeared who proved to me on the basis of satisfactory evidence to be the'PersonfiO whose namerrs��,, Y''�'W V subscribed to the within instrument and acknowledged to me tha(&7199�executed the same a in ( ' authorized ca aci ,and that b 'r signature(s)ature(,g)on the instrument ��rffhe�r p tyf� � � the person, or the entity upon behalf of which the person�sYacted,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. K. MAIORCA LAMR COMM.01931045 WITNESS my hand and off�l seal. fil NOTARY PUBLIC•CALIFORMAS BAN B8V*jWW coLwff / c4m�ron APR t Y015 Signature (Seal) ACKNOWLEDGMENT State of California ) County of ) On before me, (insert name ofmwy) Notary Public, personally appeared who proved to me on the basis of satisfactory evidence to be the person(s)whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies),and that by his/her/their signature(s)on the instrument the person(s), or the entity upon behalf of which the person(s)acted,executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. Signature (Seal)