HomeMy WebLinkAbout8/3/2016 - STAFF REPORTS - 4.A. n
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r 41F0;L CITY COUNCIL STAFF REPORT
DATE: August 3, 2016 UNFINISHED BUSINESS
SUBJECT: APPROVE ESCROW INSTRUCTIONS RELATED TO THE
CONVEYANCE OF CITY PROPERTY TO SELENE PALM SPRINGS,
LLC AND AUTHORIZING THE CITY MANAGER TO EXECUTE ALL
DOCUMENTS RELATED TO THE AGREEMENTS
FROM: David H. Ready, City Manager
BY: Community & Economic Development Department
SUMMARY
This action is to approve the escrow instructions for the conveyance of City owned
property consisting of a 7.8 acre parcel at the northeast corner of Calle Alvarado and
Amado to Selene Palm Springs, LLC.
RECOMMENDATION:
1) Approve Escrow Instructions for the conveyance of a 7.8 acre parcel at the
northeast corner of Calle Alvarado and Amado to Selene Palm Springs LLC ;
2) Authorize the City Manager to execute all necessary documents.
Discussion:
The original agreement for the disposition of the 7.8 +/- acre parcel at the northeast
corner of Calle Alvardo and Amado ("Property") was a Disposition and Development
Agreement ("DDA") between the Community Redevelopment Agency of the City of
Palm Springs ("RDA") and Re: Loftpartners Palm Springs, LLC, dated December 19,
2007. Under the terms of this DDA, the RDA would sell the Property to Loftpartners for
the $4,675,000. (A copy of the DDA is attached to this Staff Report.)
Following the recession, the City and Lauri Kibby, a principal in Loftpartners, negotiated
a new agreement, the current Purchase and Sale Agreement, dated March of 2013,
between the City and Selene Palm Springs LLC. Under the provisions of this Purchase
and Sale Agreement, the City agreed to sell the Property to Selene Palm Springs LLC
("Selene") in the amount of $2,000,000 for the development of a luxury hotel on the site.
ITEM NO.O_
City Council Agenda
Escrow Instructions/Selene
August 3, 2016
Page 2
(A copy of the Purchase and Sale Agreement and the amendments thereto are attached
to this Staff Report.)
Pursuant to a separate "Services Agreement" between the City and Selene Palm
Springs, which was approved concurrently with the Purchase and Sale Agreement,
Selene is obligated to also pay the City the amount of $2,675,000 "for the unamortized
parking improvements necessary or desirable for the construction of at least 350
parking spaces . . . to replace existing public parking spaces on the City Property that
will be lost as a result of the sale of the City Property" to Selene. The Services
Agreement contemplates that the $2,675,000 payment would be used as the public
contribution towards a financing mechanism authorized under the Statewide Community
Infrastructure Program ("SCIP"). (A copy of the Services Agreement is attached to this
Staff Report.) The proposed escrow instructions, at the request of Selene and its
lender, eliminates reference to "at least 350 parking spaces" and no longer suggests
that the 350 spaces is above or in excess of the minimum parking Selene would
otherwise be required to provide for the luxury hotel project. There are restrictions on
the use of the SCIP financing mechanism related to public use that will help ensure that
public parking will be provided in excess of Selene's parking requirements; however, we
do not know at this time how many unrestricted public parking spaces will be available.
Most of the provisions of the escrow instructions are standard terms and conditions.
(A copy of the complete draft escrow instructions are attached to this Staff Report.) The
provisions added to the escrow instructions by this agenda item are as follows:
The following are additional instructions to the above paragraph:
A. Pursuant to Developer's letter submitted to Owner on December 23, 2015
in compliance with Paragraph 36 of the Purchase and Sale Agreement, the
Developer's bridge lender is Beech Tree Capital.
B. Grant Deed shall include the following deed restriction:
1. Buyer grants Seller the right to maintain, operate, and use the property as
a parking lot, at no cost to Seller, until such time as the Buyer or Buyer's
Successor commences construction as contemplated and defined in
Amendment No. 4 to the Purchase and Sale Agreement between the Grantor
and Grantee executed by the parties dated November 19, 2015. Upon the
commencement of construction as defined herein, this deed restriction shall
terminate.
2. Grant Deed shall include the following deed restriction:
Buyer shall install on the property public parking together with rights of access,
ingress, and egress over appropriate areas of the property for the purpose of
using such parking spaces for use of the general public in perpetuity. Buyer's
obligations, which accrue solely to the named Buyer, or an assignee of the
Buyer approved by the Seller (whose approval shall not be unreasonably
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City Council Agenda
Escrow Instructions/Selene
August 3, 2016
Page 3
withheld), under this restriction, shall be deemed fully satisfied through Buyer's
or Buyer's approved assignee's performance of its obligations pursuant to the
Services Agreement, as amended, between the Buyer and the Seller. Upon
completion of, and issuance of an occupancy permit for, a parking structure
pursuant to the Services Agreement, this restriction shall terminate. Any other
successor of Buyer in the property, including without limitation any successor
following a default of Buyer under the Purchase and Sale Agreement or the
Services Agreement, shall pay to the City the amount of Two Million, Six
Hundred and Seventy Five Thousand Dollars ($2,675,000.00), prior to the
issuance of a building permit on the property, and such amount shall be
increased annually by increases in the consumer price index for all urban
consumers for the Los Angeles-Riverside-Orange County Standard Metropolitan
Statistical Area as reported by the United States Bureau of Labor Statistics, or
any successor to such index.
3. Buyer and Seller authorize and instruct Escrow Holder to accept and act
on signature(s) throughout this escrow in the form of photo copies, e-mail or
faxes, as defined in this Escrow as though they were original signature(s), to
open escrow and for other purposes.
Additional material will be provided prior to the Council meeting.
Lauri Aylaian, Director of Community David H. Ready, City ger
Development
Dougl s Holland, City Attorney
C: Disposition and Development Agreement, dated December 19, 2007
Purchase and Sale Agreement, dated 03.06.2013
Amendment No. 1 to Purchase and Sale Agreement, dated 03.05.2014
Amendment No. 2 to Purchase and Sale Agreement, dated 10.01.2014
Amendment No. 3 to Purchase and Sale Agreement, dated 04.15.2015
Amendment No. 4 to Purchase and Sale Agreement, dated 11.04.2015
Amendment No. 5 to Purchase and Sale Agreement, approved 06.15.2015
Amendment No. 6 to Purchase and Sale Agreement, approved 07.13.2015
Services Agreement, dated 03.06.2013
Amendment No. 1 to Services Agreement, dated 11.04.2015
Draft Escrow Instructions
03
DISPOSITION AND DEVELOPMENT AGREEMENT
By and Between
COMMUNITY REDEVELOPMENT AGENCY
OF THE CITY OF PALM SPRINGS
and
RE: LOFTPARTNERS PALM SPRINGS, LLC,
A DELAWARE LIMITED LIABILITY COMPANY
PALM SPRINGS MERGED REDEVELOPMENT PR0JECT AREA NO. 2
945623035983/0003 OqRIy�G. I/`��rtLSO _ _
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TABLE OF CONTENTS
[NOTE: TOCtO BE UPDATE ONCE AGREEMENT IS FINAL]
I. [§1001 SUBIECT OF AGREEMENT..........................................................................................I
A. [§1011 Purpose of This Agreement..........._.................._..................................1
13. [§102J The Redevelopment Plan............ ........................................
C. [§103] The Project Area........................... ........................................................2
D- [§104] The Site .............................. ............... .......... ..........................._2
E. [§105] Parties to This Agreement........................................................... .......2
F. [§108] Deposit.................................. ............................................. ...........3
U, [t200] DISPOSITION OF THE SITE.................................I..,..... .. .....................................4
A. [§201] Sale and Purchase;Lease ..................................................4
B. [42021 Escrow...................................................................................................5
C. [§203] Conveyance of Title and Delivery of Possession..................................8
D. [§204] Conditions Prcccdmt.......................... .................................................8
E. [§2091 Form of Deed;Ground Lease...............................................-----...---..I I
F. [§2101 Condition of Title........................................... ................. ..................I I
G. [§211] Time for and Place of Delivery of Deed..............................................I I
H. [§2121 Payment of the Purchase Price and Recordation of Deed and
Memorandum of Lease...................................................................._12
1. [§213] Tide Insurance................................ ................................................12
J. 1§2141 Taxes and Assessments.......................................................................12
K. [§215] Conveyance Free of Fo&scssion----- .....................................................13
L. [§2161 Inspections;Conditions of the Agency Parcel.....................................13
M. (§217] Zoning of the Site.............................................................................15
N. [§218] Condition or the Age
ncy Parcel and Parking Parcel............................15
0. [§219] Preliminary Work by the Developer....................................... 16
P. [§220] Submission of Evidence of Equity Capital and Mortgage FiriauicinZ..16
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III. [§300] DEVELOPMENT OF THE SITE....................................................................................16
A. [§301] Development of the Site by the Developer..........................................16
B. (§313] Responsibilities of the Agency.........................................................---20
C. [§314] Taxes,Assessments,Encumbrances and Liens...................................20
D. [§315] Prohibition Against Transfer of Agency Parcel,the Buildings or
Structures Thereon and Assignment of Agreement............... ...........20
E. [§316] Security financing;Rights of Holders................................................21
F. [§322] Right of the Agency to Satisfy Other Liens on the Site After Title
Passim-------------- . .. -- . ....... .. .. -- ...... •...........................23
G. [§323] Certificate of Completion.................................._............................_..23
H. [§324] Prevailing Wages.................................................................. . ...........24
IV. [§400] USE OF THE SITE.................................. .....— .................._........................................25
A. [§401] Uses......................................................... . .. --....----. .....25
B. [§4021 Hotel Operator.....................................................................................25
C. [§403] Obligation to Refrain Prom Discrimination........................................26
D. [§404] Form of Nondiscrimination and Nonsegregation Clauses-------------------26
E. [§405] Effect and Duration of Covenants.......................................................27
V. [§5001 DEFAULTS.REMEDIES AND TERMINATION......................................................_.28
A. [§5011 Defaults—General..... .....................................................................28
B. [§502] Legal Actions......................................................................................28
C. [§506] Rights and Remedies are Cumulative..................................................29
D. [§507] Option to Repurchase,Reenter and Repossess....................................29
E- [§508] Power of Termination..........................................................................31
VI. (§6001 GENERAL PROVISIONS ....................................34
A. [§6011 Notices,Demands and Communications Between the Parries—.........34
B. [§602] Conflicts of Jnterest.................... ....,.................................................34
C. [§603] Nonliability of Agency Officials and Employees................................34
D. [§604] Enforced Delay. Extension of Times ofPedormancc.........--------------- 4
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E. [§605] Inspection of Books and Records........................................................35
F. [§606] PlansandData.....................................................................................35
G. [§607] Attomeys'Fees................................ ...............................................35
V11. [§700] SPECLSI_PROVISIONS.............................. .............................................35
A. [§701] Amendmcntof Redevelopment Plan...................................................35
B. [§702] Submission of Documents to the Agency for Approval......................36
C. [§703] Amendmonts to this Agreement..........................................................36
VIII. [§800] ENTIRE AGREEMENT,WAIVERS AND AMENDMENTS.......................................36
LY. TIME FOR ACCEPTANCE OF AGREEMENT BY AGENCY...................................................37
Attachments
Attachment No. 1 Map of the Snc
Attachment No.2 Legal Description of the Site
Attachment No.3 Schedule of Pefformanee
Attachment No.4 Scope of Development
Attachment No.5 Form of Grant Deed
Attachment No.6 Promissory Note
Attachment No.7 Deed of Trust
9456230 35983/0003
07
DISPOSITION AND DEVELOPMENT AGREEMENT
THIS AGREEMENT is entered into as of the_ day of
2007, by and between the CONBIUNITY REDEVELOPMENT AGENCY OF THE
CITY OF PALM SPRINGS (the "Agency"), and RE: LOFT PARTNERS PALM
SPRINGS, LLC, a Delaware limited liability company (the "Developer"). The Agency
and the Developer agree as follows:
1. [§1001 SUBJECT OF AGREEMENT
A. [§101] Purpose of This Agreement
The purpose of this Agreement is to effectuate the Amended and Restated
Redevelopment PIan (the "Redevelopment Plan") for the Palm Springs Merged
Redevelopment Project Area No. 2 (the "Project") and adopted plans and policies of the
City of Palm Springs ("City"), including the restoration and rehabilitation of private and
public properties, elimination of blight, the renewal and enhancement of a vibrant
commercial and tourist core near the City's downtown area, and ensuring the availability
of conference and hotel uses near the Convention Center by providing for the disposition
and development of certain real property (the "Site") included within the boundaries of
the Project (the "Project Area") with a hotel and condominium project (the
"Development"). The Developer shall construct or cause to be constructed on the site a
"four star"Mondrian hotel, including at least two hundred(200)hotel rooms,at least fifty
(50) condominium-hotel rooms, ten thousand (10,000) square feet of"under-roof' group
meeting space, no more than one hundred fifty (150) condominium uruts, and on-site
parking which meets the requirements of the City.
The development of the Site pursuant to this Agreement and the
fulfillment generally of this Agreement are in the vital and best interests of the City, and
the health, safety, morals and welfare of its residents and in accord with the public
purposes and provisions of applicable federal, state and local laws and requirements.
B. [§102) The Redevelopment Plan
This Agreement is subject to the provisions of the Amended and Restated
Redevelopment Plan that was approved and adopted on February 19, 2003, by the City
Council of the City of Palm Springs by Ordinance No_ 1624, as amended. The
Redevelopment Plan, as it now exists and as it maybe subsequently amended pursuant to
Section 701, is incorporated herein by reference and made a part hereof as though fully
set forth herein. The Agency is entering into this Agreement to carry out the provisions
of the Redevelopment PIan.
9456230 35983/0003 12/13/2007
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C. [§103] The Project Area
The Project Area is located in the City of Palm Springs, California, and
the exact boundaries thereof are specifically described in the Redevelopment Plan.
D. [§104) The Site
The Site is that portion of the Project Area shown on the Map of the Site
(Attachment No. 1) and is more particularly described in the Legal Description of the Site
(Attachment No. 2). The Agency owns an approximately 7.8 acre portion of the Site
("Agency Parcel'). The Agency Parcel is currently used as a public parking lot. The
Agency shall convey in fee all of the Agency Parcel to the Developer in accordance with
the terms and provisions of this Agreement. The Developer owns an approximately 2.7
acre portion of the Site adjacent to the north of the Agency Parcel ("Developer Parcel").
The Developer Parcel and the Agency Parcel shall be collectively referred to herein as the
"CondolHotel Parcel." The Developer intends to develop a hotel, meeting space, and
condominiums on the Condo/Hotel Parcel, all as discussed in Section 101 above, That
portion of the Condo/Hotel Parcel on which Developer intends to develop the hotel and
meeting space condo hotel units is referred to herein as the "Hotel Parcel' and that
portion of the Condo/Hotel Parcel on which Developer intends to develop the
condominium is referred to herein as the "Condominium Parcel." The Agency Parcel,
Developer Parcel, Hotel Parcel and Condominium Parcel are each shown on the Map of
the Site(Attachment No. 1).
E. [§105] Parties to This Agreement
L [§]06] The Agencv
The Agency is a public body, corporate and politic, exercising
governmental functions and powers and organized and existing under the Community
Redevelopment Law of the State of California (Health and Safety Code Section 33000
et seq.). The office of the Agency is located at 3200 East Tahquitz Canyon Way, Palm
Springs, CA 92263. "Agency" as used in this Agreement, includes the Redevelopment
Agency of the City of Palm Springs and any assignee of or successor to its rights,powers
and responsibilities.
2. [§107] The Develot)
The Developer is RE: LOFT PARTNERS PALM SPRINGS, LLC,
a Delaware limited liability company. The principal office of the Developer is located at
100 South Sunrise 'Way, No. 498, Palm Springs, CA 92262. Wherever the term
"Developer" is used herein, such term shall include any permitted nominee, assignee or
successor in interest as herein provided.
The qualifications and identity of the Developer are of particular
concern to the Agency, and it is because of such qualifications and concerns that the
94562250 35983/0003 2 12/13/2007
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Agency has entered into this Agreement with the Developer. No voluntary or involuntary
successor in interest of the Developer shall acquire any rights or powers under this
Agreement except as expressly set forth herein. This Agreement may be terminated by
the Agency if there is any significant change (voluntary or involuntary) in the
management or control of the Developer prior to the issuance of a Certificate of
Completion of the development of the Hotel Parcel. Notwithstanding the foregoing, the
Developer may assign, one time only, its interest in this Agreement upon prior written
notice to the Agency, but without the Agency's consent, to a single purpose entity owned
and controlled by the Developer("Permitted Transferee").
Any proposed buyer, transferee, conveyee, assignee or lessee shall
have the qualifications and financial responsibility necessary and adequate, as may be
reasonably determined by the Agency, to fulfill the obligations undertaken in this
Agreement by the Developer. Any such proposed buyer, transferee, conveyer, assignee
or lessee, by instrument in writing satisfactory to the .Agency and in form recordable
among the land records, for itself and its successors and assigns, and for the benefit of the
Agency, shall expressly assume all of the obligations of the Developer under this
Agreement and agree to be subject to all conditions and restrictions to which the
Developer is subject. There shall be submitted to the Agency for review all instruments
and other legal documents proposed to effect any such sale, transfer, conveyance,
assignment or lease, and, if approved by the Agency, such approval shall be indicated to
the Developer in writing.
In the absence of specific written agreement by the Agency, no
sale, transfer, conveyance, assignment or lease, or the approval thereof by the Agency,
shall be deemed to relieve the Developer or any other party from any obligations under
this Agreement.
F. [§108] Deposit
Developer shall deliver to the Agency a deposit of cash or certified check
satisfactory to the Agency in the amount of TWO HUNDRED AND FIFTY
THOUSAND DOLLARS ($250,000) (the "Deposit') as security for the performance of
the obligations of the Developer to be performed prior to the return of the Deposit to the
Developer or its retention by the Agency as liquidated damages. The Deposit shall be
delivered in accordance with the schedule attached hereto as Attachment No. 3.
In lieu of cash or certified check, the Deposit, at the option of the
Developer,maybe in the form of-
1. Negotiable certificates of deposit issued by a federal or
state bank; or
2. An unconditional and irrevocable letter of credit, in favor
of the Agency, from a bank authorized to do business in
9456230 35983/0003 3 t2/t3/2007 10
California, in form and substance satisfactory to the
Agency.
The Agency shall be under no obligation to pay or earn interest on the
Deposit,but if interest is paid thereon, such interest shall become part of the Deposit.
Upon termination of this Agreement by the Agency as provided in Section
204 hereof, the Deposit(including all interest accrued thereon,if any)shall be retained by
the Agency as liquidated damages as provided therein.
Upon termination of this Agreement by either party as provided in Section
204 hereof, the Deposit(including all interest accrued thereon, if any) shall be returned to
the Developer by the Agency as provided therein.
If the Developer is in default with respect to any provision of this
Agreement, the Agency may, but shall have no obligation to, use the Deposit or any
portion of the Deposit to cure such default or to compensate the Agency for any expense
or damage sustained by the Agency and resulting from such default. I£this Agreement
has not been terminated as a result of such default, the Developer, on demand from the
Agency, shall promptly restore such Deposit to the full amount required by this Section.
If this Agreement shall not have been theretofore cancelled or terminated,
or the Deposit shall not have been returned to the Developer, the Agency shall return the
Deposit to the Developer upon completion of the improvements and development of the
Site for which a final Certificate of Completion has been issued pursuant to Section 323
hereof.
11. l§200J DISPOSITION OF THE SITE
A. [§2011 Sale and Purchase
In accordance with and subject to all the terms, covenants and conditions
of this Agreement, the Agency agrees to sell, and the Developer agrees to purchase for
development, the entire Agency Parcel for the sum of Four Million Six Hundred
Thousand Seventy Five Thousand Dollars (S4,675,000) (the "Purchase Price"),
$3,742,750 of which shall be paid at the close of escrow and the remaiuiog balance of
which, in the amount of Nine Hundred Thirty Two Thousand Two Hundred and Fifty
Dollars ($932,250.00), shall be paid in accordance with the terms and provisions of the
Promissory Note attached hereto as Attachment 6 ("Note"), which Promissory Note shall
be secured by the Deed of Trust attached hereto as Attachment ("Deed of Trust'), which
shall only encumber Parcel 3 of Tentative Map No. Mal
a
945623v3 35983/0003 4 12/13/:007
The Developer acknowledges and understands that the Agency Parcel will
be conveyed to the Developer for purposes of development pursuant to this Agreement
and not for speculation in undeveloped land.
B. [§202] Escrow
The Agency agrees to open an escrow with First American Title Insurance
Company, or any other escrow company approved by the Agency and the Developer, as
escrow agent (the "Escrow Agent"), in Palm Springs, California, within the time
established in the Schedule of Performance (Attachment No. 3) for the purpose of
conveying fee title to the Agency Parcel to the Developer. This Agreement constitutes
the joint escrow instructions of the Agency and the Developer, and a duplicate original of
this Agreement shall be delivered to the Escrow Agent upon the opening of escrow. The
Agency and the Developer shall provide such additional escrow instructions as shall be
necessary and consistent with this Agreement. The Escrow Agent hereby is empowered
to act under this Agreement and, upon indicating its acceptance of the provisions of this
Section in writing, delivered to the Agency and to the Developer within five (5) days
after the opening of the escrow, shall carry out its duties as Escrow Agent hereunder.
The Developer shall deposit with the Escrow Agent an amount equal to
the Purchase Price less the initial outstanding principal amount of the Note in accordance
with the provisions of Section 208 of this Agreement.
The Developer shall timely and properly execute, acknowledge (as
necessary) and deliver the Note and the Deed of Trust.
The Developer shall also pay in escrow to the Escrow Agent the following
fees, charges and costs promptly after the Escrow Agent has notified the Developer of the
amount of such fees, charges and costs, but not earlier than ten (10) days prior to the
scheduled dale for the close of escrow:
1_ One-half(1/2) of the escrow fee; and
2. The portion of the premium For the title insurance policies
or special endorsements to be paid by the Developer as set
forth in Section 209 of this Agreement.
The Agency shall timely and properly execute, acknowledge and deliver a
deed conveying to the Developer fee title to the Agency Parcel in accordance with the
requirements of Section 203 of this Agreement, together with an estoppel certificate
certifying that the Developer has completed all acts (except deposit of the Purchase Price
less the initial outstanding principal amount of the Note) necessary to entitle the
Developer to such conveyance, if such be the fact.
The Agency shall pay in escrow to the Escrow Agent the following fees,
charges and costs promptly after the Escrow Agent has notified the Agency of the amount
945623v3 35983/0003 5 12/1312007
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of such fees, charges and costs, but not earlier than ten (10) days prior to the scheduled
date for the close of escrow:
1. Costs necessary to place the title to the Agency Parcel in
the condition for conveyance required by the provisions of
this Agreement;
2. One-half(1/2) of the escrow fee;
3. Cost of drawing the deed and memorandum of lease;
4. Recording fees;
5. Notary Fees;
6. The premium for an A.L.T.A. standard title insurance
owners policy to be paid by the Agency as set forth in
Section 209 of this Agreement and the cost for a
corresponding A_L_T.A. survey,
7. Ad valorem taxes, if any, upon the Agency Parcel for any
time prior to conveyance of title; and
8. Any state, county or city documentary transfer tax_
Upon delivery of the deed to the Escrow Agent by the Agency pursuant to
Section 205 of this Agreement, the Escrow Agent shall record such deed when title can
be vested in the Developer in accordance with the terms and provisions of this
Agreement. Immediately thereafter, Escrow Agent shall record the Deed of Trust. The
Escrow Agent shall buy, affix and cancel any transfer stamps required by law and pay
any transfer tax required by law. Any insurance policies governing the Agency Parcel
are not to be transferred.
The Escrow Agent is authorized to:
1. Pay and charge the Agency and the Developer,
respectively, for any fees, charges and costs payable under
this Section. Before such payments are made, the Escrow
Agent shall notify the Agency and the Developer of the
fees, charges and costs necessary to clear title and close the
escrow;
2. Disburse funds and deliver the deed and other documents to
the parties entitled thereto when the conditions of this
escrow have been fulfilled by the Agency and the
Developer; and
945623v3 35983/0003 6 12/13l2007 13
3. Record any instruments delivered through this escrow, if
necessary or proper, to vest title in the Developer in
accordance with the terms and provisions of this
Agreement.
All funds received in this escrow shall be deposited by the Escrow Agent
with other escrow funds of the Escrow Agent in a general escrow account or accounts
with any state or national bank doing business in the State of California. Such funds may
be transferred to any other such general escrow account or accounts. All disbursements
shall be made by check of the Escrow Agent. All adjustments shall be made on the basis
of a thirty(30) day month.
If this escrow is not in condition to close before the time for conveyance
established in Section 203 of this Agreement, either party who then shall have fully
performed the acts to be performed before the conveyance of title may, in writing,
terminate this Agreement in the mariner set forth in Section 204 hereof and demand the
return of its monies,papers or documents. Thereupon all obligations and liabilities of the
parties under this Agreement shall cease and terminate in the manner set forth in Section
204 hereof. If neither the Agency nor the Developer shall have fully performed the acts
to be performed before the time for conveyance established in Section 203, no
termination or demand for return shall be recognized until ten (10) days after the Escrow
Agent shall have mailed copies of such demand to the other party or parties at the address
of its or their principal place or places of business. If any objections are raised within the
ten (10) day period, the Escrow Agent is authorized to hold all monies, papers and
documents with respect to the Agency Parcel until instructed in writing by both the
Agency and the Developer or upon failure thereof by a court of competent jurisdiction. If
no such demands are made, the escrow shall be closed as soon as possible. Nothing in
this Section shall be construed to impair or affect the rights or obligations of the Agency
or the Developer to specific performance.
Any amendment of these escrow instructions shall be in writing and
signed by both the Agency and the Developer. At the time of any amendment, the
Escrow Agent shall agree to carry out its duties as Escrow Agent under such amendment.
All communications from the Escrow Agent to the Agency or the
Developer shall be directed to the addresses and in the manner established in Section 601
of this Agreement for notices,demands and communications between the Agency and the
Developer.
The liability of the Escrow Agent under this Agreement is limited to
performance of the obligations imposed upon it under Section 202 of this Agreement.
Neither the Agency nor the Developer shall be liable for any real estate
commissions or brokerage fees that may arise herefrom. The Agency and the Developer
each represent that neither has engaged any broker, agent or finder in connection with
this transaction.
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C. [§2031 Conveyance of Title and Delivery of Possession
Provided that the Developer is not in default under this Agreement and all
conditions precedent to such conveyance have occurred, and subject to any mutually
agreed upon extensions of time, conveyance to the Developer of fee title to the Agency
Parcel shall be completed on or prior to the date specified in the Schedule of Performance
(Attachment No. 3). The Agency and the Developer agree to perform all acts necessary
to conveyance of title in sufficient time for-title to be conveyed in accordance with the
foregoing provisions.
Possession shall be delivered to the Developer concurrently with the
conveyance of title, except that limited access may be permitted before conveyance of
title as permitted in Section 215 of this Agreement. The Developer shall accept title and
possession on or before said date-
D. [§204] Conditions Precedent
1. Agency Conditions
Close of escrow shall be subject to the fulfillment or waiver by the
Agency of each of the conditions precedent described below. Each of the following
conditions are solely for the benefit of the Agency and shall be fulfilled or waived prior
to close of escrow:
a. Developer shall have submitted to Agency evidence
reasonably satisfactory to Agency that developer has
obtained commitments for the equity capital and mortgage
financing necessary to finance a portion of the
development of the Agency Parcel that is being closed
upon pursuant to this Agreement, which evidence may be
provided in the form of a letter or letters of intent.
b. Developer has provided the confirmation and the abstract
required pursuant to Section 402.
C. Developer shall not be in default of any of its obligations
under the terms of this Agreement.
d. There shall be no litigation pending with respect to the
Agreement or any City approvals related to the
Development, the outcome of which could materially
interfere with the development of that portion of the
Agency Parcel that is being closed upon.
e. Developer has obtained or will obtain all discretionary
permits and land use approvals required for the
9456230 35983/0003 R 12/112007
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development of that portion of the Agency Parcel that is
being closed upon pursuant to this Agreement, excepting a
final planned development permit and a final map which
are anticipated to be issued or approved subsequent to the
approval of this Agreement but prior to the close of
escrow, and ministerial permits such as grading and
building permits.
2. Developer Conditions
Close of escrow is subject to the fulfillment or waiver by the
Developer of each of the conditions precedent described below, which are solely for the
benefit of the Developer and which shall be fulfilled or waived prior to close of escrow:
a. Developer's approval of the condition of title pursuant to
Section 206.
b. The Developer has obtained binding commitments for the
equity capital and mortgage financing necessary to finance
a portion of the development of the Site pursuant to this
Agreement.
C. Developer has obtained or will obtain all discretionary
permits and Iand use approvals required for the
development of the Site pursuant to this Agreement,
excepting a final planned development permit and a final
map, and ministerial permits such as grading and building
permits.
d. The Agency shall not be in default of any of its obligations
contained herein and all representations and warranties of
the Agency contained herein shall be true and correct in all
material respects.
3. Termination for Failure of Condition
In the event that, prior to the time established in the Schedule of
Performance (Attachment No. 3) for close of escrow, there is a failure of one or more
conditions described in Section 204 that is not waived by the benefited party, the party
for whose benefit the condition is established may terminate this Agreement by written
notice to the other party. In the event of such a termination, the Agency shall return the
Deposit to the Developer and no party shall have any further rights or liabilities to the
other under this Agreement.
945623v3 35983/0003 9 12/13=07 16
4. Liquidated Damages
IF THIS AGREEMENT IS TERMINATED BY THE AGENCY
FOR A DEFAULT OF THE DEVELOPER PRIOR TO CLOSE OF ESCROW, THE
DEPOSIT MAY BE RETAINED BY T14E AGENCY AS LIQUIDATED DAMAGES
AND AS ITS PROPERTY WITHOUT ANY DEDUCTION, OFFSET OR
RECOUPMENT WI-ATSOEVER. IF THE DEVELOPER SHOULD DEFAULT UPON
ITS OBLIGATIONS, MAKING IT NECESSARY FOR THE AGENCY TO
TERMINATE THIS AGREEMENT AND TO PROCURE ANOTHER PARTY OR
PARTIES TO REDEVELOP THE SITE IN SUBSTANTIALLY THE MANNER AND
WITHIN THE PERIOD THAT SUCH SITE WOULD BE REDEVELOPED UNDER
THE TERMS OF THIS AGREEMENT, THEN THE DAMAGES SUFFERED BY THE
AGENCY BY REASON THEREOF WOULD BE UNCERTAIN. SUCH DAMAGES
WOULD INVOLVE SUCH VARIABLE FACTORS AS THE CONSIDERATION
THAT SUCH PARTY WOULD PAY FOR THE SITE; THE EXPENSES OF
CONTINUING THE OWNERSHIP AND CONTROL OF THE SITE; OF
INTERESTED PARTIES AND NEGOTLATING WITH SUCH PARTIES;
POSTPONEMENT OF TAX REVENUES THEREFROM THE COMMUNITY; AND
THE FAILURE OF THE AGENCY TO EFFECT ITS PURPOSES AND OBJECTIVES
WITHIN A REASONABLE TIME, RESULTING IN ADDITIONAL
IMMEASURABLE DAMAGE AND LOSS TO THE AGENCY AND THE
COMMUNITY. IT IS IMPRACTICABLE AND EXTREMELY DIFFICULT TO FIX
THE AMOUNT OF SUCH DAMAGES TO THE AGENCY, BUT THE PARTIES ARE
OF THE OPINION, UPON THE BASIS OF ALL INFORMATION AVAILABLE TO
THEM, THAT SUCH DAMAGES WOULD APPROXIMATELY EQUAL THE
AMOUNT OF THE DEPOSIT HELD BY THE AGENCY AT THE TIME OF THE
DEFAULT OF THE DEVELOPER, AND THE AMOUNT OF SUCH DEPOSIT
SHALL BE PAID TO THE AGENCY UPON ANY SUCH OCCURRENCE AS THE
TOTAL OF ALL LIQUIDATED DAMAGES FOR ANY AND ALL SUCH
DEFAULTS AND NOT AS A PENALTY_ IN THE EVENT THAT THIS
PARAGRAPH SHOULD BE HELD TO BE V01D FOR ANY REASON, THE
AGENCY SHALL BE ENTITLED TO THE FULL EXTENT OF DAMAGES
OTHERWISE PROVIDED BY LAW.
THE DEVELOPER AND THE AGENCY SPECIFICALLY
ACKNOWLEDGE THIS LIQUIDATED DAMAGES PROVISION BY THEIR
SIGNATURES HERE:
By:
By.
9456230 35983/0003 10 12/13/2007 17
E. [§205] Form of Deed
The Agency shall convey to the Developer fee title to the Agency Parcel
in the condition provided in Section 206 of this Agreement by grant deed in substantially
the form set forth in Attachment No. 5.
F. [§206) Condition of Title
Within the times set forth in the Schedule of Performance (Attachment
No. 3), the Agency shall submit a Preliminary Title Report for the Agency Parcel to the
Developer for approval, together with legible copies of all documents referenced therein.
Developer shall approve or disapprove any exceptions to title within fifteen(IS)business
days from the time of receipt. Failure by the Developer to either approve or disapprove
the exceptions to title within such time shall be deemed an approval. If the condition of
title is not acceptable to Developer, the Agency shall have thirty (30) days to eliminate
exceptions to title. If Agency is unable to eliminate exceptions to title, Developer may
terminate this Agreement pursuant to Section 204. Notwithstanding the foregoing, the
City shall remove all monetary encumbrances other than a lien for taxes not yet due and
payable.
The Agency shall convey to the Developer fee simple title to the Agency
Parcel &ee and clear of all recorded liens, encumbrances, assessments, Imes, and taxes
except as are consistent with this Agreement and as approved by the Developer pursuant
to this Section.
G. [§2071 Time for and Place of Delivery of Deed
Subject to any mutually agreed upon extensions of time, the Agency shall
deposit the grant deed for the Agency Parcel with the Escrow Agent on or before the date
established for close of escrow in the Schedule of Performance(Attachment No. 3).
945623v3 35983/0003 11 12/13/2007
18
H. [§208] Payment of the Purchase Price and Recordation of Deed
The Developer shall deposit the required portion of the Purchase Price the
(less the initial outstanding principal amount of the Note) that corresponds to the Agency
Parcel and other sums required hereunder with the Escrow Agent prior to the close of
escrow, provided that the Escrow Agent shall have notified the Developer in writing that
the grant deed, properly executed and acknowledged by the Agency, have been delivered
to the Escrow Agent and that title is in condition to be conveyed in conformity with the
provisions of Section 206 of this Agreement. Upon the close of escrow, the Escrow
Agent shall file the grant deed for recordation among the land records in the Office of the
County Recorder of Riverside County, shall deliver the corresponding portion of the
Purchase Price and other required sums to the Agency and shall deliver to the Developer
a title insurance policy insuring title in conformity with Section 209 of this Agreement.
1. [§209) Title Insurance
Concurrently with recordation of the grant deed, First American Title
Insurance Company, or some other title insurance company satisfactory to the Agency
and the Developer having equal or greater financial responsibility ("Title Company"),
shall provide and deliver to the Developer one or more title insurance policies issued by
the Title Company insuring that title is vested in the Developer in the condition required
by Section 206 of this Agreement. The Title Company shall provide the Agency with a
copy of the title insurance policies, and the title insurance policies shall be in an amount
reasonably determined by Developer.
The Agency shall pay only For that portion of the title insurance premium
attributable to au A.L_T.A. standard owners form policy of title insurance in the amount
of the portion of the Purchase Price paid for the Agency Parcel_ The Developer shall pay
for all other premiums for title insurance coverage or special endorsements.
Concurrently with close of escrow, the Title Company shall, if requested
by the Developer,provide the Developer with an endorsement to insure the amount of the
Developer's estimated development costs of the improvements to be constructed upon the
Agency Parcel. The Developer shall pay the entire premium for any such increase in
coverage requested by it.
J. [§2101 Taxes and Assessments
Ad valorem taxes and assessments on the Agency Parcel,if any, and taxes
upon this Agreement or any rights hereunder, levied, assessed or imposed for any period
commencing prior to conveyance of title shall be borne by the Agency. All such ad
valorem taxes and assessments levied or imposed for any period commencing after
closing of the escrow shall be paid by the Developer.
9456230 35983/0003 12 12/13/2007 19
K_ [§211] Conveyance Free of Possession
Except as otherwise provided in the Scope of Development (Attachment
No. 4), the Agency Parcel shall be conveyed free of any possession or right of possession
by any person except that of the Developer and the casements of record-
L. [§212] Inspections; Conditions of the Agency Parcel
1. Inspections
Developer has conducted a Phase 1 Environmental Study and Soils
Analysis of the Agency Parcel and is satisfied with their condition.
No further analysis or studies of the Agency Parcel are required.
2. "As Is"
Developer agrees it will rely solely on its own investigation and
agrees to purchase the Agency Parcel "as is,"in its current physical
condition, with no warranties, express or implied, as to the
physical condition thereof,the presence or absence of any latent or
patent condition thereon or therein, including, without limitation,
any hazardous Materials (as defined herein) thereon or therein.
3. Developer Indemnity
Developer agrees, from and after close of escrow, to defend,
indemnify, protect and hold harmless the Agency and its officers,
beneficiaries, employees, agents, attorneys, representatives, legal
successors and assigns ("Indemnitees")from,regarding and against
any and all liabilities, obligations, orders, decrees, judgments,
liens, demands, actions, Environmental Response Actions (as
defined herein), claims, losses, damages, fines,penalties, expenses,
Environmental Response Costs (as defined herein) or costs of any
kind or nature whatsoever, together with fees (including, without
limitation, reasonable attorneys' fees and experts' and consultants'
fees),whenever arising, unless caused in whole or in part by any of
the Indemnilees, resulting &onr or in connection with the actual or
claimed generation, storage, handling, transportation, use,
presence, placement, migration and/or release of Hazardous
Materials (as defined herein), at, on, in, beneath or from the
Agency Parcel (collectively referred to as "Contamination").
Developer's defense,indemnification,protection and hold harmless
obligations herein shall include, without limitation, the duty to
respond to any governmental inquiry, investigation, claim or
demand regarding the Contamination, at Developer's sole cost.
945623v3 35983l0003 13 12/13=07 20
4. Release and Waiver
The Developer hereby releases and waives all rights, causes of
action and claims Developer has or may have in the future against
the Indemnitecs arising out of or in connection with any Hazardous
Materials (as defined herein), at, on, in, beneath or from the
Agency Parcel, unless the presence of such Hazardous Materials
at, on, in, beneath or from the Agency Parcel is caused in whole or
in part by any of the Indemnitees. In furtherance of the intentions
set forth herein, Developer acknowledges that it is familiar with
Section 1542 of the Civil Code of the State of California which
provides as follows:
"A general release does not extend to claims
which the creditor does not know or suspect to
exist in his or her favor at the time of executing
the release, which if known by him or her must
have materially affected his or her settlement
with the debtor."
Developer hereby waives and relinquishes any right or benefit
which it has or may have under Section 1542 of the Civil Code of
the State of California or any similar provision of the statutory or
nonstatutory law of any other applicable jurisdiction to the full
extent that it may lawfully waive all such rights and benefits
pertaining to the subject matter of this Section.
5. Definitions
a. As used in this Agreement, the term "Environmental
Response Actions" means any and all activities, data
compilations, preparation of studies or reports, interaction
with environmental regulatory agencies, obligations and
undertakings associated with environmental investigations,
removal activities, remediation activities or responses to
inquiries and notice letters, as may be sought, initiated or
required in connection with any local, state or federal
governmental or private party claims, including any claims
by Developer or Agency.
b. As used in this Agreement, the term 'Environmental
Response Costs" means any and all costs associated with
Environmental Response Actions including, without
limitation, any and all fines,penalties and damages.
945623v335983/0003 14 12/132007 21
C. As used in this Agreement, the term "Hazardous Materials"
means any substance, material or waste which is
(1) defined as a "hazardous waste," "hazardous material,"
"hazardous substance," "extremely hazardous waste,"
"restricted hazardous waste," "pollutant" or any other terms
comparable to the foregoing terms under any provision of
California law or federal law; (2)petroleum; (3) asbestos;
(4)polychlorinated biphenyls; (5)radioactive materials; or
(6) determined by California, federal or local governmental
authority to be capable of posing a risk of injury to health,
safety or property.
6. Materiality
Developer acknowledges and agrees that the defense,
indemnification, protection and hold harmless obligations of
Developer for the benefit of the Agency set forth in this Agreement
are a material element of the consideration to the Agency for the
performance of its obligations under this Agreement, and that the
Agency would not have entered into this Agreement unless
Developer's obligations were as provided for herein. Developer
further acknowledges and agrees that the provisions of this Section
which extend representations, warranties, indemnifications, and/or
covenants of Developer to the benefit of the Agency shall not be,
satisfied, waived or otherwise extinguished by Agencys issuance
of any Certification of Completion under Section 323 of this
Agreement.
M. [§213] Zoning of the Site
The Agency and the Developer agree that on the date of execution of this
Agreement the Site is coned so as to permit the development and construction of
improvements in accordance with the provisions of this Agreement and the use, operation
and maintenance of such improvements.
N. [§214] Condition of the Agency Parcel
Except as may be otherwise specifically provided in the Scope of
Development(Attachment No. 4), the Agency Parcel shall be conveyed from the Agency
to the Developer in an "as is" condition. The Agency shall not be responsible for any
items of site work except those that are listed in the Scope of Development as the
Agency's responsibilities.
It shall be the sole responsibility of the Developer, at the Developer's sole
expense, to investigate and determine the soil conditions of the Agency Parcel and the
suitability of such soil conditions•for the improvements to be constructed by the
9456230 35983/0003 15 12/13/2007 22
Developer. If the soil conditions are not in all respects entirely suitable for the use or
uses to which the Agency Parcel will be put, then it is the sole responsibility and
obligation of the Developer to take such action as may be necessary to place the soil
conditions in a condition suitable for development-
O. [§215] Preliminary Work by the Developer
Prior to the conveyance of title from the Agency, representatives of the
Developer shall have the right of access to the Agency Parcel at all reasonable times for
the purpose of obtaining data and making surveys and tests necessary to carry out this
Agreement. The Developer shall hold the Agency harmless from any injury or damages
arising out of any activity pursuant to this section. The Developer shall have access to all
data and information on the Site available to the Agency, but without warranty or
representation by the Agency as to the completeness, correctness or validity of such data
and information.
Any preliminary work undertaken on the Agency Parcel by the Developer
prior to conveyance of title thereto shall be done only after written consent of the Agency
and at the sole expense of the Developer. The Developer shall save and protect the
Agency against any claims resulting from such preliminary work, access or use thereof.
Copies of data, surveys and tests obtained or made by the Developer shall be filed with
the Agency_ Any preliminary work by the Developer shall be undertaken only after
securing any necessary permits from the appropriate governmental agencies-
P. [§216] Submission of Evidence of Equity Capital and Mortgage Financing
No later than the time specified in the Schedule of Performance
(Attachment No. 3), the Developer shall submit to the Agency Counsel evidence
satisfactory to the Agency that the Developer has obtained the equity capital and
commitments for mortgage financing.
III. [§300] DEVELOPMENT OF THE SITE
A. [§301] Development of the Site by the Developer
1. f§302] Scope of Development
The Site shall be developed as provided in the Scope of
Development(Attachment No.4).
2. [§303] Preliminary Planned Development
Developer has previously prepared and submitted to the City and
the City approved schematic drawings and an entitlement application (collectively a
"Preliminary Planned Development"). The Site shall be developed as generally
established in the Preliminary Planned Development and related documents except as
945623v3 35983/0003 16 12/13/2007 23
changes maybe mutually agreed upon between the Developer and the,Agency_ Any such
changes shall be within the limitations of the Scope of Development(Attachment No.4).
3. [§304] Construction Plans.Drawings and Related Documents
The Developer shall prepare and submit construction plans,
drawings and related documents to the City/Agency for architectural and site planning
review and written approval as and at the times established in the Schedule of
Performance (Attachment No_ 3). The construction plans, drawings and related
documents shall be submitted in two stages: preliminary and final working drawings and
plans. Final working drawings and plans are hereby defined as those in sufficient detail
to obtain a building permit.
The Developer shall also prepare and submit to the City/Agency
for its approval preliminary and final landscaping and finish grading plans for the Site.
Such final plans shall be prepared and submitted within the times established in the
Schedule of Performance (Attachment No. 3), subject to extensions as are authorized
herein or as mutually agreed to by the parties hereto.
During the preparation of all final drawings and plans,
City/Agency staff and the Developer shall hold regular progress meetings to coordinate
the preparation of, submission to and review of construction plans and related documents
by the City/Agency. The City/Agency and the Developer shall communicate and consult
informally as frequently as is necessary to insure that the formal submittal of any
documents to the City/Agency can receive prompt and speedy consideration.
If any revisions or corrections of plans approved by the
City/Agency shall be required by any government official, agency, department or bureau
having jurisdiction, or any lending institution involved in financing, the Developer and
the City/Agency shall cooperate in efforts to obtain a waiver of such requirements or to
develop a mutually acceptable alternative.
1. [§305] City/Agency Approval of Plans, Drawings and Related
Documents
Subject to the terms of this Agreement,the City/Agency shall have
the right of architectural and site planning review of all plans and drawings, including
any changes therein.
The City/Agency shall approve or disapprove the plans, drawings
and related documents in a timely fashion referred to in Section 304 of this Agreement
within the times established in the Schedule of Performance (Attachment No. 3). Once
an aspect of the plans, drawings and related documents has been approved by the
City/Agency, a later rendering of such aspect, or a more detailed iteration of such aspect,
shall be approved by the City/Agency absent a material change thereto. Any disapproval
shall state in writing with reasonable specificity the reasons for disapproval and the
945623v3 35983/0003 17 12/13/2007 24
changes that the City/Agency requests be made_ Such reasons and such changes must be
consistent with the Scope of Development (Attachment No. 4) and any items previously
approved or deemed approved hereunder by the City/Agency. The Developer, upon
receipt of a disapproval based upon powers reserved by the City/Agency hereunder, shall
revise such plans, drawings and related documents and resubmit them to the City/Agency
as soon as possible after receipt of the notice of disapproval, provided that in no case
shall the City/Agency be entitled to require changes inconsistent with the Scope of
Development and any previously approved items.
If the Developer desires to make any substantial change in the
construction plans after their approval by the City/Agency, the Developer shall submit
the proposed change to the City/Agency for its approval. If the construction plans, as
modified by the proposed change, conform to the requirements of Section 304 of this
Agreement, the approvals previously granted by the City/Agency under this Section and
the Scope of Development (Attachment No. 4), the City/Agency shall approve the
proposed change and notify the Developer in writing within thirty (30) days after
submission to the City/Agency. If any such change in the construction plans is rejected
by the City/Agency, in whole or in part, such rejection shall be by written notice thereof
by the City/Agency to the Developer setting forth in detail the reasons therefor, and such
rejection shall be made within said thirty(30) day period-
5- [§306] Cost of Construction
The cost of developing the Site and constructing all improvements
thereon shall be borne by the Developer, except for work expressly set forth in this
Agreement to be performed or paid for by the Agency or others. The Agency and the
Developer shall each pay the costs necessary to administer and carry out their respective
responsibilities and obligations under this Agreement.
6. [§307] Construction Schedule
After close of escrow, the Developer shall promptly begin and
thereafter diligently prosecute to completion the construction of the improvements and
the development of the Site. The Developer shall begin and complete all construction
and development within the times specified in the Schedule of Performance(Attachment
No. 3) or such reasonable extension of said dates as may be granted by the Agency or as
provided in Section 604 of this Agreement. The Schedule of Performance is subject to
revision from time to time as mutually agreed upon in writing between the Developer and
the Agency.
During the period of construction, but not more frequently than
once a month, the Developer shall submit to the Agency a written progress report of the
construction when and as requested by the Agency. The report shall be in such form and
detail as may reasonably be required by the Agency and shall include a reasonable
number of construction photographs taken since the last report submitted by the
Developer.
945623v3 35983/0003 18 12/13/2007
25
7. [§308] Bodily Iniurv, Property Damage and Workers'
Compensation Insurance
Prior to the commencement of construction on the Site or any
portion thereof, the Developer shall furnish or cause to be furnished to the Agency
duplicate originals or appropriate certificates of bodily injury and property damage
insurance policies in the amount of at least ONE MILLION DOLLARS ($1,000,000) for
any person, FIVE MILLION DOLLARS ($5,000,000) for any occurrence and FIVE
HUNDRED THOUSAND DOLLARS ($500,000) property damage, naming the Agency
as an additional or coinsured. The Developer shall also furnish or cause to be famished
to the Agency evidence satisfactory to the Agency that any contractor with whom it has
contracted for the performance of work on the Site carries workers' compensation
insurance as required by law. The obligations set forth in this Section shall remain in
effect only until a final Certificate of Completion has been issued covering the Hotel
Parcel as hereinafter provided in Section 323.
8. [§309] City and Other Governmental Agency Permits
Before commencement of construction or development of any
buildings, structures or other work of improvement upon the Site (unless such
construction, development or work is to be commenced before the conveyance of title),
the Developer shall, at its own expense, secure or cause to be secured any and all permits
that may be required by the City or any other governmental agency affected by such
construction, development or work.
9. [§310] Rights of Access
For the purposes of assuring compliance with this Agreement,
representatives of the Agency and the City shall have the reasonable right of access to the
Site without charges or fees and at normal construction hours during the period of
construction for the purposes of this Agreement, including, but not limited to, the
inspection of the work being performed in constructing the improvements. Such
representatives of the Agency or the City shall be those who are so identified in writing
by the Executive Director of the Agency. The Agency and the City shall indemnify and
defend the Developer and hold it harmless from any damage caused or liability arising
out of this right to access.
10. [§311] Local State and FeAeral Laws
The Developer shall carry out the construction of the
improvements in conformity with all applicable laws, including all applicable federal and
state labor standards.
945623v3 35983/0003 19 121132007
26
11. [§312] Antidiscrimination During Construction
The Developer,for itself and its successors and assigns,agrees that
in the construction of the improvements provided for in this Agreement, the Developer
will not discriminate against any employee or applicant for employment because of race,
color, creed, religion, sex, marital status, ancestry or national origin.
B. [§313] Responsibilities of the Agency
The Agency, without expense to the Developer or assessment or claim
against the Site, shall perform all work specified herein and in the Scope of Development
(Attachment No. 4) for the Agency to perform within the times specified in the Schedule
of Performance(Attachment No. 3).
C. [§314] Taxes Assessments, Encumbrances and Liens
The Developer shall pay when due all real estate taxes and assessments
assessed and levied on the Site for any period subsequent to conveyance of title to or
delivery to Developer. Prior to the issuance of a Certificate of Completion for the Hotel
Parcel, the Developer shall not place or allow to be placed on the Site any mortgage, trust
deed, encumbrance or lien unauthorized by this Agreement. The Developer shall remove
or have removed any levy or attachment made on the Site (or any portion thereof), or
shall assure the satisfaction thereof, within a reasonable time, but in any event prior to a
sale thereunder. Nothing herein contained shall be deemed to prohibit the Developer
from contesting the validity or amounts of any tax, assessment, encumbrance or lien, nor
to limit the remedies available to the Developer in respect thereto.
The Developer understands that under certain conditions, its control of the
Site or portion thereof under this Agreement may give rise to the imposition of a
possessory interest tax on said property, and in such event, the Developer agrees to pay
when due any such possessory interest tax.
D. [§315] Prohibition Against Transfer of Agency Parcel. the Buildings or
Structures Thereon and Assignment of Agreement
After close of escrow of the Agency Parcel and prior to the issuance by the
Agency of a Certificate of Completion with respect to the improvements pursuant to
Section 323, with the exception of the sale of individual condominium-hotel and
condominium units, the Developer shall not, except as expressly permitted by this
Agreement, sell,transfer, convey, assign or lease the whole or any part of the buildings or
improvements thereon without the prior written approval of the Agency. This prohibition
shall not apply subsequent to the issuance of the Certificate of Completion for the
improvements on the Hotel Parcel. This prohibition shall not be deemed to prevent the
granting of easements or permits to facilitate the development of the Agency Parcel or to
prohibit or restrict the leasing of any part or parts of a building or structure when said
improvements are completed.
9456230 35983/0003 20 12/132007
. ., 27
In the absence of specific written agreement by the Agency, no such
transfer, assignment or approval by the Agency shall be deemed to relieve the Developer
or any other party from any obligations under this Agreement until completion of
development of the Hotel Parcel as evidenced by the issuance of a Certificate of
Completion therefor.
E. [§316] Security Financing: Rights of Holders
1. [§317] No Encumbrances Except Mortgages. Deeds of Trust Sales
and Lease-Backs or Other Financing for Development
Notwithstanding Sections 314 and 315 of this Agreement,
mortgages,deeds of trust, sales and lease-backs or any other form of conveyance required
for any reasonable method of financing are permitted before issuance of a Certificate of
Completion for the Hotel Parcel, but only for the purpose of securing loans of funds to be
used for financing the acquisition or development of the Agency Parcel, the construction
of improvements on the Hotel Parcel, and any other expenditures necessary and
appropriate to develop the Site under this Agreement. The Developer shall notify the
Agency in advance of any mortgage, deed of trust, sale and least-back or other form of
conveyance for financing if the Developer proposes to enter into the same before
issuance of a Certificate of Completion for the hotel Parcel. The Developer shall not
enter into any such conveyance for financing without the prior written approval of the
Agency(unless such lender shall be one of the ten (10) largest banking institutions doing
business in the State of California, or one of the ten (10) largest insurance lending
institutions in the United States qualified to do business in the State of California), which
approval the Agency agrees to give if any such conveyance is given to a responsible
financial or lending institution or other acceptable person or entity. Such lender shall be
deemed approved unless rejected in writing by the Agency within ten (10) days after
notice thereof to the Agency by the Developer. In any event, the Developer shall
promptly notify the Agency of any mortgage, deed of trust, sale and lease-back or other
financing conveyance, encumbrance or lien that has been created or attached thereto prior
to completion of the construction of the improvements on the Site whether by voluntary
act of the Developer or otherwise. The words "mortgage" and "deed of trust," as used
herein, include all other appropriate modes of financing real estate acquisition,
construction and land development.
2. [§318] Holder Not Obligated to Construct Improvements
The holder of any mortgage, deed of trust or other security interest
authorized by this Agreement shall in no way be obligated by the provisions of this
Agreement to construct or complete the improvements or to guarantee such construction
or completion, nor shall any covenant or any other provision in the grant deed for the
Hotel Parcel be construed so to obligate such holder. Nothing in this Agreement shall be
deemed to construe, permit or authorize any such holder to devote the Site to any uses or
to construct any improvements thereon other than those uses or improvements provided
for or authorized by this Agreement_
94562303598310003 21 12113r2007 28
3. [§319] Notice of Default to Mortgage. Deed of Trust or Other
Security Interest Holders: Right to Cure
Whenever the Agency shall deliver any notice or demand to the
Developer with respect to any breach or default by the Developer in completion of
construction of the improvements, the Agency shall at the same time deliver a copy of
such notice or demand to each holder of record of any mortgage, deed of trust or other
security interest authorized by this Agreement who has previously made a written request
to the Agency therefor. Each such holder shall (insofar as the rights of the Agency are
concerned) have the right, at its option, within ninety (90) days after the receipt of the
notice, to cure or remedy or commence to cure or remedy any such default and to add the
cost thereof to the security interest debt and the lien on its security interest. In the event
there is more than one such holder, the right to cure or remedy a breach or default of the
Developer under this Section shall be exercised by the holder first in priority or as the
holders may otherwise agree among themselves, but there shall be only one exercise of
such right to cure and remedy a breach or default of the Developer under this Section.
Nothing contained in this Agreement shall be deemed to permit or authorize such holder
to undertake or continue the construction or completion of the improvements(beyond the
extent necessary to conserve or protect the improvements or construction already made)
without first having expressly assumed the Developer's obligations to the Agency by
written agreement satisfactory to the Agency. The holder in that event must agree to
complete, in the manner provided in this Agreement, the improvements to which the lien
or title of such holder relates and submit evidence satisfactory to the Agency that it has
the qualifications and financial responsibility necessary to perform such obligations. Any
such holder properly completing such improvements shall be entitled, upon written
request made to the Agency, to a Certificate of Completion from the Agency.
4. [§320] Failure of Holder to Complete Improvements
In any case where, six (6) months after default by the Developer in
completion of construction of improvements under this Agreement, the holder of any
mortgage, deed of trust or other security interest creating a lien or encumbrance upon the
Site or any portion thereof has not exercised the option to construct, or if it has exercised
the option and has not proceeded diligently with construction, the Agency may purchase
the mortgage, deed of trust or other security interest by payment to the holder of the
amount of the unpaid debt, plus any accrued and unpaid interest and all other amounts
due under the loan secured thereby including, without limitation, any prepayment
obligation. If ownership has vested in the holder, the Agency, if it so desires, shall be
entitled to a conveyance from the holder to the Agency upon payment to the holder of an
amount equal to the sum of the following:
a. The unpaid mortgage, deed of trust or other security
interest debt at the time title became vested in the holder
(less all appropriate credits, including those resulting from
collection and application of rentals and other income
received during foreclosure proceedings);
945623v3 35983/0003 22 12J132007
29
b. All expenses with respect to foreclosure;
C. The net expenses, if any (exclusive of general overhead),
incurred by the holder as a direct result of the subsequent
management of the Site or portions thereof;
d. The costs of any authorized improvements made by such
holder; and
e. An amount equivalent to the interest that would have
accrued on the aggregate of such amounts had all such
amounts become part of the mortgage or deed of trust debt
and such debt had continued in existence to the date of
payment by the Agency.
5. [§321 J Right of Agency to Cure Mortgage. Deed of Trust or Other
Security Interest Default
In the event of a default or breach by the Developer of a mortgage,
deed of trust or other security interest with respect to the Site or any portion thereof prior
to the completion of development, and the bolder has not exercised its option to complete
the development, the Agency may cure the default prior to completion of any foreclosure.
In such event, the Agency shall be entitled to reimbursement from the Developer of all
costs and expenses incurred by the Agency in curing the default. The Agency shall also
be entitled to alien upon the Site or applicable portion thereof to the extent of such costs
and disbursements. Any such lien shall be subject to mortgages, deeds of trust or other
security interests executed for the sole purpose of obtaining funds to purchase and
develop the Hotel Parcel as authorized herein.
E [§322] Right of the Agency to Satisfy Other Liens on the Site After Title
Passes
After the close of escrow and prior to the issuance of a Certificate of
Completion for construction and development on the Hotel Parcel, and after the
Developer has had a reasonable time to challenge, cure or satisfy any liens or
encumbrances on the Site, the Agency shall have the right to satisfy any such liens or
encumbrances, provided, however, that nothing in this Agreement shall require the
Developer to pay or make provision for the payment of any tax, assessment, lien or
charge so long as the Developer in good faith shall contest the validity or amount thereof,
and so long as such delay in payment shall not subject the Site to forfeiture or sale.
G. (§323) Certificate ofComnletion
Promptly after completion and satisfactory inspection by the City of all
construction and development to be completed by the Developer upon the Hotel Parcel,
the Agency shall Punish the Developer with a Certificate of Completion upon written
94562303598510003 23 12113/2Q07 30
request therefor by the Developer. Such Certificate of Completion shall be in such form
as to permit it to be recorded in the Office of the County Recorder of Riverside County.
A Certificate of Completion shall be, and shall so state, conclusive
determination of satisfactory completion of the construction required by this Agreement
upon the Hotel Parcel and of full compliance with the terms hereof After issuance of
such Certificate of Completion, any party then owning or thereafter purchasing, leasing
or otherwise acquiring any interest in the Hotel Parcel covered by said Certificate of
Completion shall not (because of such ownership, purchase, lease or acquisition) incur
any obligation or liability under this Agreement, except that such party shall be bound by
any covenants contained in the grant deed, in accordance with the provisions of Sections
401-405 of this Agreement. Except as otherwise provided herein, after the issuance of a
Certificate of Completion for the Hotel Parcel, neither the Agency nor any other person
shall have any rights, remedies or controls with respect to the Hotel Parcel that it would
otherwise have or be entitled to exercise under this Agreement as a result of a default in
or breach of any provision of this Agreement, and the respective rights and obligations of
the parties shall be as set forth in the grant deed of the Hotel Parcel.
The Agency shall not unreasonably withhold a Certificate of Completion.
If the Agency refirses or fails to furnish a Certificate of Completion for the Hotel Parcel
after written request from the Developer, the Agency shall, within ten (10) days after
receipt of such written request, provide the Developer with a written statement of the
reasons the Agency refused or failed to furnish a Certificate of Completion. The
statement shall also contain the Agency's opinion of the action the Developer must take
to obtain a Certificate of Completion_ If the reason for such refusal is confined to the
immediate unavailability of specific items or materials for landscaping, the Agency will
issue its Certificate of Completion upon the posting of a bond by the Developer with the
Agency in an amount representing a fair value of the work not yet completed. If the
Agency shall have failed to provide such written statement within said ten (10) day
period, the Developer shall be deemed entitled to the Certificate of Completion_
Such Certificate of Completion shall not constitute evidence of
compliance with or satisfaction of any obligation of the Developer to any holder of a
mortgage or any insurer of a mortgage securing money loaned to finance the
improvements or any part thereof. Such Certificate of Completion is not notice of
completion as referred to in California Civil Code Section 3093 or a Certificate of
Occupancy.
H. [§324] Prevailing Wages
When improvements which are considered to be public works under State
law are constructed, the Developer is required to (i) pay and to cause its contractor and
subcontractors to pay,prevailing wages for the construction of the improvements as those
wages are determined pursuant to Labor Code Sections 1720 et seq. and (ii) implement
regulations of the Department of Industrial Relations and (ii) comply with the other
applicable provisions of Labor Code Sections 1720 et seq. Neither Agency nor
9456230 35983/0003 24 12/13+-007 31
Developer believe that the project to be developed on the Site is a public work for
purposes of State law. Developer shall indemnify, hold harmless and defend (with
counsel reasonably acceptable to the Agency) the Agency against any claim for damages,
compensation, fines, penalties or other amounts arising out of the failure or alleged
failure of any person or entity(including Developer, its contractors and subcontractors)to
pay prevailing wages as required by law or to comply with the other applicable
provisions of Labor Code Sections 1720 et seq. or to implement regulations of the
Department of Industrial Relations in connection with construction of the improvements
or any other work undertaken or in connection with the Site.
W. ]§400] USE OF THE SITE
A. [§401] Uses
The Developer covenants and agrees for itself, its successors, its assigns
and every successor in interest that the Developer and its successors and assignees shall
use, operate and maintain the Site and the improvements thereon only for a four star
Mondrian hotel and meeting space with parking and related uses, including no less than
two hundred (200) hotel rooms, 50 condominium-botel units, ten thousand (10,000)
square feet of "eider-roof' meeting space, no more than one hundred fifty (150)
condominium units. The hotel will provide no less than a one hundred fifty (150) room
block commitment to the Convention Center under the Convention Center's Committable
Rooms Program as further set forth in the Hotel Operating Agreement described in
Section 402 below.
The Developer shall use the Site and the improvements thereon for no
purpose other than hotel and condominium related uses without the prior written consent
of the Agency. The foregoing covenant shall run with the land. For purposes of this
Section, a "four star hotel" means a full service hotel comparable to other Mondrian
hotels in operation as of the date of this Agreement.
B. [§402] Hotel Operator
The Developer shall cause the hotel to be constructed on the Hotel Parcel
to be operated pursuant to an operating and/or management agreement ("Hotel Operating
Agreement") with a qualified operator ("Operator"). The Hotel Operating Agreement
shall provide for no less than a one hundred fifty (150) room block commitment to the
Convention Center under the Convention Center's Committable Rooms Program, The
Operator shall be satisfactory to the Agency, in its reasonable discretion and shall have a
reputation, experience and qualifications for managing a four star hotel, as defined in
Section 401. Prior to conveyance of the Agency Parcel to the Developer, the Developer
shall provide to the Agency written confirmation that it has entered into the Hotel
Operating Agreement with the Operator together with an abstract of Hotel Operating
Agreement which identifies the material terms and provisions contained therein.
9456230 35983/0003 25 12/132007
32
If the Operator is not a publicly traded company or entity, then any change
in the identity of the Operator prior to issuance of a Certificate of Completion shall
require the prior written approval of the Agency, which approval shall not be
unreasonably withheld or delayed if the new Operator meets the qualifications set forth in
this Agreement. As used herein "change in the identity of Operator" shall mean any
change in fifty percent (50%)or more of the ownership or control of the Operator or in a
general partner, managing partner or other entity having a controlling interest in
Operator.
C. [§4031 Oblieation to Refrain From Discrimination
The Developer covenants by and for itself and any successors in interest
that there shall be no discrimination against or segregation of any person or group of
persons on any basis listed in subdivision (a) or (d) of Section 12955 of the Government
Code, as those bases are defined in Section 12926, 12926.1, subdivision (m) and
paragraph (1) of subdivision (p) of Section 12955, and Section 12955.2 of the
Government Code in the sale, lease, sublease, transfer, use, occupancy, tenure or
enjoyment of the Site, nor shall the Developer itself or any person claiming under or
through it establish or permit any such practice or practices of discrimination or
segregation with reference to the selection, location, number, use or occupancy of
tenants, lessees, subtenants, sublessees or vendees of the Site. The foregoing covenants
shall run with the land.
D. [§4041 Form of Nondiscrimination and Nonsegregation Clauses
The Developer shall refrain from restricting the rental, sale or lease of the
Site on any basis listed in subdivision (a) or (d) of Section 12955 of the Government
Code, as those bases are defined in Section 12926, 12926.1, subdivision (m) and
paragraph (1) of subdivision (p) of Section 12955, and Section 12955.2 of the
Government Code. All such deeds, leases or contracts shall contain or be subject to
substantially the following nondiscrimination or nonsegregation clauses:
1. In deeds: "Tbe grantee herein covenants by and for himself or
herself, his or her heirs, executors, administrators and assigns, and
all persons claiming under or through them, that there shall be no
discrimination against or segregation of any person or group of
persons on any basis listed in subdivision (a) or (d) of Section
12955 of the Government Code, as those bases are defined in
Section 12926, 12926.1, subdivision (m) and paragraph (1) of
subdivision (p) of Section 12955, and Section 12955.2 of the
Government Code in the sale, lease, sublease, transfer, use,
occupancy, tenure or enjoyment of the premises herein conveyed,
nor shall the grantee,or any person claiming under or through him
or her, establish or permit any such practice or practices of
discrimination or segregation with reference to the selection,
location,number, use or occupancy of tenants, lessees, subtenants,
9456230 35983/0003 26 12/1312g07 33
sublessees or vendees in the premises herein conveyed. The
foregoing covenants shall run with the land."
2. In leases: "The lessee herein covenants by and for himself or
herself, his or her heirs, executors, administrators and assigns, and
all persons claiming under or through him or her, and this lease is
made and accepted upon and subject to the following conditions:
That there shall be no discrimination against or segregation of any
person or group of persons on any basis listed in subdivision (a) or
(d) of Section 12955 of the Goverment Code, as those bases are
defined in Section 12926, 12926.1, subdivision (m) and paragraph
(1) of subdivision (p) of Section 12955, and Section 12955.2 of
the Govemment Code, in the leasing, subleasing, transferring, use,
occupancy, tenure or enjoyment of the premises herein leased, nor
shall the lessee himself or herself, or any person claiming under or
through him or her, establish or pen-nit any such practice or
practices of discrimination or segregation with reference to the
selection, location, number, use or occupancy of tenants, lessees,
subtenants, sublessees or vendees in the premises herein leased."
3. In contracts: "There shall be no discrimination against or
segregation of any person or group of persons on any basis listed
in subdivision (a) or (d) of Section 12955 of the Government
Code, as those bases are defined in Section 12926, 12926.1,
subdivision (m) and paragraph (1) of subdivision (p) of Section
12955, and Section 12955.2 of the Government Code in the sale,
lease, sublease, transfer, use, occupancy, tenure or enjoyment of
the premises, nor shall the transferee himself or herself, or any
person claiming under or through him or her, establish or permit
any such practice or practices of discrimination or segregation
with reference to the selection, location,number,use or occupancy
of tenants, lessees, subtenants, sublessees or vendees of the
premises."
E. (§405) Effect and Duration of Covenants
Except as otherwise provided, the covenants contained in this Agreement
and the grant deed shall remain in effect until (the termination date of the
Redevelopment Plan). The covenants against discrimination shall remain in effect in
perpetuity. The covenants established in this Agreement and the grant deed shall,
without regard to technical classification and designation, be binding for the benefit and
in favor of the Agency, its successors and assigns, the Agency and any successor in
interest to the Site or any part thereof:
945623v3 35983/0003 27 12/132007 34
The Agency is deemed the beneficiary of the terms and provisions of this
Agreement and of the covenants running with the land for and in its own rights and for
the purposes of protecting the interests of the community and other parties, public or
private, in whose favor and for whose benefit this Agreement and the covenants running
with the land have been provided. This Agreement and the covenants shall run in favor
of the Agency without regard to whether the Agency has been, remains or is an owner of
any land or interest therein in the Site, any parcel or subparcel, or in the Agency Parcel.
The Agency shall have the right, if this Agreement or the covenants are breached, to
exercise all rights and remedies and to maintain any actions or suits at law or in equity or
other proper proceedings to enforce the curing of such breaches to which it or any other
beneficiaries of this Agreement and the covenants may be entitled.
V. [§500] DEFAULTS,REMEDIES AND TERMINATION
A. [§501] Defaults—General
Subject to the extensions of time set forth in Section 604, failure or delay
by either party to perform any term or provision of this Agreement constitutes a default
under this Agreement. The party who so fails or delays must immediately commence to
cure, correct or remedy such failure or delay and shall complete such cure, correction or
remedy with reasonable diligence and during any period of curing shall not be in default.
The injured party shall give written notice of default to the party in default
specifying the default complained of by the injured party. Except as required to protect
against further damages, the injured party may not institute proceedings against the party
in default until thirty (30) days after giving such notice. Failure or delay in giving such
notice shall not constitute a waiver of any default nor shall it change the time of default.
Except as otherwise expressly provided in this Agreement, any failure or
delay by either party in asserting any of its rights or remedies as to any default shall not
operate as a waiver of any default or of any such rights or remedies or deprive such party
of its right to institute and maintain any actions or proceedings that it may deem
necessary to protect, assert or enforce any such rights or remedies.
B_ [§502] Legal Actions
1. [§503] Institution of Legal Actions
In addition to any other rights or remedies, either party may
institute legal action to cure, correct or remedy any default, or recover damages for any
default, or to obtain any other remedy consistent with the purpose of this Agreement.
Such legal actions must be instituted in the Superior Court of the County of Riverside,
State of California.
9456230 35983/0003 29 12/13/2007 35
2. [§504] Applicable Law: Interpretation
The laws of the State of California shall govem the interpretation
and enforcement of this Agreement.
This Agreement has been negotiated at arm's length and between
persons sophisticated and knowledgeable in the matters dealt with herein. In addition,
each party has been represented by experienced and knowledgeable legal counsel.
Accordingly, any rule of law (including California Civil Code Section 1654) or legal
decision that would require interpretation of any ambiguities in this Agreement against
the party that has drafted it is not applicable and is waived. The provisions of this
Agreement shall be interpreted in a reasonable manner to effect the purposes of the
parties and this Agreement.
1 [§505] Acceptance of Service of Process
In the event that any legal action is commenced by the Developer
against the Agency, service of process on the Agency shall be made by personal service
upon the Exccutivc Director or in such other manner as may be provided by law.
In the event that any legal action is commenced by the Agency
against the Developer, service of process on the Developer shall be made by personal
service upon the Developer or in such other manner as may be provided by law and shall
be valid whether made within or without the State oFCali forria_
C. [§506] Rights and Remedies are Cumulative
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
such rights or remedies shall not preclude the exercise by it, at the same time or different
times, of any other rights or remedies for the same default or any other default by the
other party.
D. [§507] Option to Repurchase. Reenter and Repossess
The Agency shall have the right at its option to repurchase the Agency
Parcel together with all improvements thereon, if after conveyance of title to the Agency
Parcel and prior to the issuance of the Certificate of Completion for the Hotel Parcel, the
Developer shall:
1. Fail to commence construction of approved improvements on the
the Agency Parcel within the time established therefor in the
Schedule of Performance (Attachment No. 3), for any reason
whatsoever. For purposes o f this provision, the Developer shall be
deemed to "commence construction" when and only when the
Developer has received City approval of the final plans and
945623v3 35933/0003 29 12/13/2007 36
specifications for all improvements provided in this Agreement,
completed rough grading on the Agency Parcel, and commenced
installation and construction of improvements provided herein
pursuant to permits issued by the City for the construction of such
improvements; or
2. Once construction has been commenced in accordance with
subparagraph 1 above, fail to diligently prosecute construction of
the improvements through completion within the time established
therefor in the Schedule of Performance (Attachment No. 3),
where such failure has not been cured within three (3) months
after written notice thereof from the Agency; or
3. Abandon or substantially suspend construction of the
improvements for a period of three (3) months after written notice
of such abandonment or suspension from the Agency; or
4. Without the prior written consent of Agency, directly or indirectly,
voluntarily or involuntarily sell, assign, transfer, dispose of or
further encumber or agree to sell, assign, transfer, dispose of or
further encumber or suffer to exist any other lien against all or any
portion of or any interest in the Agency Parcel, except for (i) a
Permitted Transfer, (ii) equipment or "soil goods" financing, (iii)
mezzanine or similar debt, or (iv) any sale or transfer that is
expressly permitted by the terms of this Agreement. For the
purpose of this paragraph, the terms "sell' and "transfer" shall
include, in addition to the common and ordinary meaning of those
terms and without limiting their generality, transfers made to
subsidiary or affiliated entities, and any "change in ownership" as
that term is used from time to time in California real property
taxation law, irrespective of the fact that the Agency Parcel may
be exempt from such transaction during the period when owned by
Agency.
This option shall be subordinate and subject to and be limited by and shall
not defeat,render invalid or limit:
A. Any mortgage, deed of trust or other security instrument affecting
the Agency Parcel as permitted by this Agreement; or
B. Any rights or interests provided in this Agreement for the
protection of the holder of such mortgages, deeds of trust or other
security instruments.
9456230 35983/0003 30 12/132007 37
To exercise its right to repurchase, reenter and take possession with
respect to the Agency Parcel, the Agency shall pay to the Developer in cash an amount
equal to:
1. The cash Purchase Price for the Agency Parcel paid by the
Developer; plus
IL The costs actually incurred by the Developer for "hard" and "soft"
costs related to the Agency Parcel and the improvements to be
constructed thereon, including, without limitation, architectural,
engineering and legal fees, fees paid to any governmental entity,
and the cost of all on-site labor and materials for the construction of
the improvements existing on the Agency Parcel at the time of the
repurchase, reentry and repossession, exclusive of amounts
financed; less
i
III. Any gains or income withdrawn Or made by the Developer from the
Project Area or the improvements thereon; and less
IV. The amount of any unpaid assessments and any liens against the
Agency Parcel.
E. [§508] Power of Termination
The Agency shall have the additional right, at its option, to terminate the
estate conveyed to the Developer, to reenter and take possession of the Agency Parcel
with all improvements thereon and to revest in the Agency the estate theretofore
conveyed to the Agency, if after conveyance of title to the Agency Parcel and prior to
issuance of the Certificate of Completion for the Hotel Parcel,the Developer shall:
1. Fail to commence construction of approved improvements on the
portion of the Agency Parcel within the time established therefor
in the Schedule of Performance (Attachment No. 3), for any
reason whatsoever. For purposes of this provision, the Developer
shall be deemed to "commence construction"when and only when
the Developer has commenced rough grading (if required)
pursuant to a permit issued by the City for the construction of the
improvements provided for herein, the final plans and
specifications for which had been approved by the City; or
2. Once construction has been commenced in accordance with
subparagraph 1 above, fail to diligently prosecute construction of
the improvements through completion within the time established
therefor in the Schedule of Performance (Attachment No. 3),
where such failure has not been cured within three (3) months
after written notice thereof from the Agency;or
945623v3 35933/0003 31 1211V2007
38
3. Abandon or substantially suspend construction of the
improvements for a period of three (3) months after written notice
of such abandonment or suspension from the Agency; or
4. Without the prior written consent of Agency, directly or indirectly,
voluntarily or involuntarily sell, assign, transfer, dispose of or
further encumber or agree to sell, assign, transfer, dispose of or
further encumber or suffer to exist any other lien against all or any
portion of or any interest in the Site, except for (i) a Permitted
Transfer, (ii) equipment or"soli goods" financing, (iii) mezzanine
or similar debt, or (iv) any sale or transfer that is expressly
permitted by the terms of this Agreement. For the purpose of this
paragraph, the terms "sell" and "transfer" shall include, in addition
to the common and ordinary meaning of those terms and without
limiting their generality, transfers made to subsidiary or affiliated
entities, and any "change in ownership" as that term is used from
time to time in California real property taxation law, irrespective
of the fact that the Site may be exempt from such transaction
during the period when owned by Agency.
The interest created pursuant to this Section shall be a "power of
termination" as defined in California Civil Code Section 885.010, and shall be separate
and distinct from Agency's option to repurchase the Agency Parcel under the same or
similar conditions specified in Section 507 above. The Agency 's power of termination
shall be subordinate and subject to and be limited by and shall not defeat, render invalid
or limit:
1. Any mortgage, deed of trust or other security instrument permitted
by this Agreement; or
2. Any rights or interest provided in this Agreement for the
protection of the holder of such mortgages, deeds of trust or other
security instruments.
Upon revesdng title to the Agency Parcel or any part thereof in the
Agency as provided in this Section, the Agency shall use its best efforts to resell the
Agency Parcel or part thereof as soon and in such manner as the Agency shall find
feasible to a qualified and responsible party or parties (as determined by the Agency)who
will assume the obligation of making or completing the improvements, or such other
improvements in their stead, as shall be satisfactory to the Agency and in accordance
with the uses specified for the Agency Parcel or part thereof in the Redevelopment Plan.
Upon resale of the Agency Parcel, the proceeds thereof shall be applied:
1. First, to reimburse the Agency for all costs and expenses incurred
by the Agency, including, but not limited to, salaries to personnel
in connection with the recapture, management and resale of the
945623v3 35983/0003 32 12/13/2007 39
Agency Parcel or part thereof(but less any income derived by the
Agency from the Agency Parcel or part thereof in connection with
such management); all taxes, assessments and water and sewer
charges with respect to the Agency Parcel or part thereof(or, in
the event the Agency Parcel is exempt from taxation or assessment
or such charges during the period of ownership, then such taxes,
assessments or charges [as determined by the County assessing
official] as would have been payable if the Agency Parcel were
not so exempt); any payments made or necessary to be made to
discharge or prevent from attaching or being made any subsequent
encumbrances or liens due to obligations, defaults or acts of the
Developer; any expenditures made or obligations incurred with
respect to the malcing or completion of the improvements or any
part thereof on the Agency Parcel or part thereof; and any amounts
otherwise owing the Agency by the Developer; and
2. Second, to reimburse the Developer the sum of the following: (a)
the cash portion of that portion of the Purchase Price for the
Agency Parcel paid by the Developer; plus (b) any cash payments
previously made by the Developer for the development of the
Agency Parcel and for the improvements existing on the Agency
Parcel at the time of the reentry and repossession, exclusive of
amounts financed but inclusive of all "hard" and "soft" costs
related to the site and the improvements to be constructed thereon,
including, without limitation, architectural, engineering and legal
fees, fees paid to any governmental entity, and the cost of all on-
site labor and materials for the construction of the improvements
existing on the Site at the time of the such reimbursement,
exclusive of amounts financed; less (c) any gains or income
withdrawn or made by the Developer from the Agency Parcel or
the improvements thereon; and less (d) the amount of any unpaid
assessments against the Agency Parcel.
Any balance remaining after such reimbursements shall be retained by the
Agency as its property_
As set forth above,this section is intended to create and reserve in the
Agency a "power of termination" under California law, and not a forfeiture. The
terms and provisions of this Section shall be construed in light of the fact that the
Agency will convey the Agency Parcel to the Developer for development pursuant to
the Redevelopment Plan, and not for speculation in undeveloped land.
945623v3 35983/0003 33 12/1312007
40
VI. [§6001 GENERAL PROVISIONS
A. [§601] Notices,Demands and Communications Between the Parties
Formal notices, demands and communications between the Agency and
the Developer shall be sufficiently given if dispatched by registered or certified mail,
postage prepaid, return receipt requested, to the principal offices of the Agency and the
Developer as set forth in Section 105 hereof. Such written notices, demands and
communications may be sent in the same manner to such other addresses as either party
may from time to time designate by mail.
B. [§602] Conflicts of Interest
No official or employer. of the Agency shall have any personal interest,
direct or indirect, in this Agreement, nor shall any such official or employee participate in
any decision relating to this Agreement that affects his or her personal interests or the
interests of any corporation, partnership or association in which he or she is directly or
indirectly interested.
The Developer warrants that it has not paid or given, and will not pay or
give, any third person any money or other consideration for obtaining this Agreement.
C. [§6031 Nonliability of Agency Officials and Employees
No official or employee of the Agency shall be personally liable to the
Developer in the event of any default or breach by the Agency or for any amount that
may become due to the Developer or on any obligations under the terms of this
Agreement.
D. [§604) Enforced Dclmv Extension of Times of Performance
In addition to the specific provisions of this Agreement, performance by
any party hereunder shall not be deemed to be in default where delays or defaults are due
to war; act of terrorism; insurrection; strikes; lock-outs; riots; floods; earthquakes; fires;
casualties; acts of God; acts of the public enemy; epidemics; quarantine restrictions;
freight embargoes; lack of transportation; governmental restrictions or priority;litigation;
unusually severe weather; inability to secure necessary labor, materials or tools; delays of
any contractor, subcontractor or supplier; acts of another party; acts or the failure to act of
any public or governmental agency or entity (except that acts or the failure to act of the
Agency shall not excuse performance by the Agency); or any other causes beyond the
control or without the fault of the party claiming an extension of time to perform. An
extension of time for any such cause shall only be for the period of the enforced delay,
which period shall commence to run from the time of the commencement of the cause.
If,however, notice by the party claiming such extension is sent to the other parties more
than thirty (30) days after the commencement of the cause, the period shall commence to
9456230 35983/0003 34 12/13/2007
41
run only thirty (30) days prior to the giving of such notice. Times of performance under
this Agreement may also be extended in writing by the Agency and the Developer.
E. [§605] Insuection of Books and Records
The Agency has the right, upon not less than seventy-two (72) hours
notice, at all reasonable times, to inspect the books and records of the Developer
pertaining to the Site as pertinent to the purposes of this Agreement.
The Developer also has the right, upon not less than seventy-two (72)
hours notice, at all reasonable tunes, to inspect the books and records of the Agency
pertaining to the Site as pertinent to the purposes of this Agreement.
F. [§606] Plans and Data
Where the Developer does not proceed with the purchase of the Agency
Parcel and development thereof, and when this Agreement is terminated for any reason,
the Developer shall deliver to the Agency any and all plans and data concerning the the
Agency Parcel, and the Agency or any other person or entity designated by the Agency
shall be free to use such plans and data, including plans and data previously delivered to
the Agency, for any reason whatsoever without cost or liability therefor to the Developer
or any other person-
Q. [§607] Attomeys'Fees
Should any action be brought arising out of this Agreement including,
without limitation, any action for declaratory or injunctive relief, the prevailing party
shall be entitled to reasonable attorneys' fees and costs and expenses of investigation
incurred, including those incurred in appellate proceedings or in any action or
participation in, or in connection with, any case or proceeding under Chapter 7, 11 or 13
of the Bankruptcy Code or any successor statutes, and any judgment or decree rendered
in any such actions or proceeduigs shall include an award thereof.
VII. [§700] SPECIAL PROVISIONS
A. [§701] Amendment of Redevelopment PI
Pursuant to provisions of the Redevelopment Plan for modification or
amendment thereof, the Agency agrees that no amendment that changes the uses or
development permitted on the Site or changes the restrictions or controls that apply to the
Site or otherwise directly affect the use of the Site shall be made or become effective
without the prior written consent of the Developer. Amendments to the Redevelopment
Plan applying to other property in the Project Area shall not require the consent of the
Developer.
9456230 35983/0003 35 12/13/2007 42
B. [§702] Submission of Documents to the Agency for Approval
Whenever this Agreement requires the Developer to submit plans,
drawings or other documents to the Agency for approval, which shall be deemed
approved if not acted on by the Agency within a specified time, said plans, drawings or
other documents shall be accompanied by a letter stating that they are being submitted
and will be deemed approved unless rejected by the Agency within the stated time. If
there is no time specified herein for such Agency action, the Developer may submit a
letter requiring Agency approval or rejection of documents within thirty (30) days after
submission to the Agency or such documents shall be deemed approved.
C. [§703] Amendments to this Aerccment
The Developer and the Agency agree to mutually consider reasonable
requests for amendments to this Agreement that may be made by any of the parties
hereto, lending institutions or bond counsel or financial consultants to the Agency,
provided such requests are consistent with this Agreement and would not substantially
alter the basic business terms included herein.
D. [§704] Conflicts
In the event of a conflict between the terms and provisions of this
Agreement and the terms and provisions of the Attacluments, the terns and provisions of
the Attachments shall control.
VIII. [§8001 ENTIRE AGREEMENT,WAIVERS AND AMENDMENTS
This Agreement is executed in four (4) duplicate originals, each of which is
deemed to be an original. This Agreement comprises pages 1 through. inclusive, and
Attachment Nos_ 1 through 5, attached hereto and incorporated herein by reference, all of
which constitute the entire understanding and agreement of the parties.
This Agreement integrates all of the terms and conditions mentioned herein or
incidental hereto, and supersedes all negotiations or previous agreements between the
parties with respect to all or any part of the subject matter hereof.
All waivers of the provisions of this Agreement must be in writing and signed by
the appropriate authorities of the Agency and the Developer, and all amendments hereto
must be in writing and signed by the appropriate authorities of the Agency and the
Developer.
If, at any time after the date on which this Agreement is approved, the City
approves a disposition and development agreement for any condominium hotel project in
the City(including, but not limited to, the Hard Rock Hotel project being proposed as of
the date of this Agreement) which is reasonably comparable to the Project and which
disposition and development agreement contains terms or provisions that are materially
945623v335983/0003 36 12/13/2007 43
more favorable than the terms and provisions contained herein, then the corresponding
terms and provisions of this Agreement shall be deemed to be amended to match (as near
as possible) such favorable terms and provisions- Any such amendment shall be
automatic and shall require no further action on the part of the Agency or the Developer.
IX. TIME FOR ACCEPTANCE OF AGREEMENT BY AGENCY
This Agreement, when executed by the Developer and delivered to the Agency,
must be authorized, executed and delivered by the Agency widen forty-five (45) days
after the date of signature by the Developer or this Agreement shall be void, except to the
extent that the Developer shall consent in writing to further extensions of time for the
authorization, execution and delivery of this Agreement. The effective date of this
Agreement shall be the date when this Agreement has been signed by the Agency.
2007 COMMUNITY REDEVELOPMENT
AGENCY OF THE CITY OF PALM
SPRINGS, a public body, corporate and
politic )
By: �Y /
By
1 AssLS�Can Secretar
�ZO f7�' Title:
"AGENCY"
Approved as tdform:
P+ Or v L�1."L:'.'.
/AgencyCounsel
0. 4. 1-flD �:AB�— RE: LOFT PARTNERS PALM SPRINGS,
LLC,a Delaware limited liability company
By:
Title: lwr x 1 •n f '`
DEVELOPER"
9456230 35983/0003 37 11/13/2007 44
more favorable than the terms and provisions contained herein, then the corresponding
terms and provisions of this Agreement shall be deemed to be amended to match(as near
as possible) such favorable terms and provisions. Any such amendment shall be
automatic and shall require no further action on the part of the Agency or the Developer_
IX. TIME FOR ACCEPTANCE OF AGREEMENT BY AGENCY
This Agreement, when executed by the Developer and delivered to the Agency,
must be authorized, executed and delivered by the Agency within forty-five (45) days
after the date of signature by the Developer or this Agreement shall be void,except to the
extent that the Developer shall consent in writing to further extensions of time for the
authorization, execution and delivery of this Agreement The effective date of this
Agreement shall be the date when this Agreement has been signed by the Agency.
, 2007 COMMUNITY REDEVELOPMENT
AGENCY OF TM CITY OF PALM
SPRINGS, a public bodd-ecorporate and
politic y
By:
Title:
y
By:
"AGENCY"
Approved as to form:
Agency Counsel
2007 RE: LOFT PARTNERS PALM SPRINGS,
LLC,a Delaware limited liability company
Ku ),��,% By:
�� � �sloes''•N �:
S
t
C> Title:
SHARON K MNVS Titlep;
NOTARY FUSUO +-
COSB COUNTY,C:OROIA
MY COMMISSION.E%PIRES dJNE 29,2006
more favorable than the terms and provisions contained herein, then the corresponding
terms and provisions of this Agreement shall be deemed to be amended to match (as near
as possible) such favorable terms and provisions. Any such amendment shall be
automatic and shall require no further action on the part of the Agency or the Developer.
TIC. TIME FOR ACCEPTANCE OF AGREEMENT BY AGENCY
This Agreement, when executed by the Developer and delivered to the Agency,
must be authorized, executed and delivered by the Agency within forty-live (45) days
after the date of signature by the Developer or this Agreement shall be void, except to the
extent that the Developer shall consent in writing to further extensions of time for the
authorization, execution and delivery of this Agreement. The effective date of this
Agreement shall be the date when this Agreement has been signed by the Ageytcy.
, 2007 COMMUNITY REDEVELOPMENT
AGENCY OF TIE/TY OF PALM
SPRINGS, a public ody, corporate and
politic
By:
Title:
By:
Tit
Approved as to form: AGENCY"
Agency Counsel
2007 RE: LOFT PARTNERS PALM SPRINGS,
LLC, a Delaware limited liability company
By:
Title: 0)( d Wan Wan4 X 2` C41M Sprirls W,
By:
Title:
By:
ile
"DEVELOPER"
46
ATTACHMENT NO. I
MAP OF THE SITE
94%23v3 35983/0003 Acwchmem No. 1 12/13/2007 47
r.i '• __ .u• ^l� �--=..'ate al.:— }.� '.+�.fur.i.
.f` 3 ' _�i-L - _ � i. + e !7 'idly,"- ��`'•'1 Swy .'[; _
'%i. JI
fit
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Developer ,' 'h=a?.:R' _ I - f"N; ,s �-". Y.Ski!
Parcel s .!;'i: ..-.y; •!'w"�•:Y? •3" 4t _W.+.r.•-I W,a'( 1 .t
r� Tl I� a
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07
E's t I , r,. tl 9lv
■. - 1{.o- 1i - sir :.rL f �. - r �.. =? x.•
_ ,.." - - . t :LHotel Parcel V i:f -i.. ...: .: `' .:�:"- ':a:ti t. '�sa'• .. s .,
"� r-.�•g � ;; � ?�`I�.
k��� $� -•.�:— r -"•�y,.' f{r` - - ...�' -=-' ...�'� ° Parcel :,: - _: - _ r L:z�,F4`�� IS.. r-- -.�• .-.£.
•1;''i:rs - - •f ;Ii-•e,Vj• �;.5.�`y ! !` - - -.: .• '.I.r�Ft�:�IiE ��1 '-��� .Y,
lF it� :�. ..CS';._ . ^,� i�jr .. `r...1'--raAr _}e�'EF�i+ ..� l .:r:-`�' _ •�':: ���1,__� �[�JI � .
_ __ "�•yy� � n,�,ils�-',.�' .._ - - ,_ - _ _ r� =.mow;-_::.f= - - _" �•. - _ - '•'__
" � .�''K :. . �,...5l.e C`..." fir. _,��>�: _ - _ _i-. ^_.....7•T1fi"'�1-Ys}��.
7apy�}ZC'_.r107:CTvdiw.Diz;rnRCS.Tc(.khs.eybl Nidoy,,:ts a• 1 �'„r.'41'.--. y+sn. r y �1,: _ _ _ -' ..Ls<!' r N
Mondrian Hotel Parcel 300A
a �& MYGES
Agency Parcel = Hotel
Parcel plus Condo Parcel
Copyright®2OgBAPRlghts Reserved. The wnfonnatlancordanedheralnlstheproprlelalypropMyofthe
conlrIlyAorsupplled under hcarse and may not he approeed except as Ilcensed h/Plglal L14p,Products
OD
ATTACHMENT NO.2
LEGAL DESCRIPTION OF THE SITE
Agency Parcel:
All that certain real property located in the City of Palm Springs, County of Riverside,
State of California,more particularly described as follows:
BLOCKS 103, 105 AND 106 IN SECTION 14, TOWNSHIP 4 SOUTH, RANGE 4
EAST, SAN BERNARDINO MERIDIAN, TN THE CITY OF PALM SPRINGS,
COUNTY OF RIVERSIDE, STATE OF CALIFORNIA, ACCORDING TO THE
OFFICAL PLAT THEREOF.
Developer Parcel:
BLOCK 102 IN SECTION 14, .TOWNSHIP 4 SOUTH, RANGE 4 EAST, SAN
BERNARDINO MERIDIAN, IN THE CITY OF PALM SPRINGS, COUNTY OF
RIVERSIDE, STATE OF CALIFORNIA, ACCORDING TO THE OFFICAL PLAT
THEREOF.
945623035983/0003 AttachmcntNo 2 12/13/2007
49
ATTACBMENT NO.3
SCHEDULE OF PERFORMANCE
Item To Be Performed Time for Agreement Estimated
Performance Reference Date
1. Developer executes and delivers DDA to On or before December
Agency 19,2007
2_ Agency holds public hearing on DDA December 19,2007
3. Agency approves or disapproves DDA and,if On or before December December
approves,executes DDA 31, 2007 31,2007
4. Submission—Certificates of Insurance. The Within 30 days after January 31,
Developer shall furnish to the Agency execution of this 2008,
duplicate originals or appropriate certificates Agreement by the
of bodily injury and property damage Agency.
insurance policies.
5. Deposit:The Developer delivers the Deposit Within 90 day after Section 108 March 31,
to the Agency. execution of this 2008
Agreement by the
Agency and the
Developer.
6. Submission—Final Planned Development Within 120 days after Section 304 April 30,
District Application. The Developer shall execution of this 2008
prepare and submit to the City Planning and Agreement by the
Engineering Departments for review and Agency.
approval the Final PDD and related
documents containing the overall plan for
development of the Site. The City process
includes the Architectural Advisory
Committee,Planning Commission,and City
Council approval. Such Final PDD
application shall include final Site Flan,
Architectural Elevations,Landscaping and
Grading Plans,Lighting Plans,and other
plans necessary to approve the Planned
Development District.
7. Submission—Evidence of Equity Financing, Within 120days after Section 216 April 30,
Hotel Management Agreement,and execution of this 2008
Condominium Licensing and marketmg Agreement by the
cement. The Developer shall submit to Agency and the
the Agency Counsel for review and approval Developer.
evidence of equity capital financing,the Hotel
Management Agreement,and the
Condominium Licensing and Management
Agreement.
8. Acceptance--Evidence of Equity inancing Within 30 days after Section 216, May 30,
50
Hotel Management Agreement,and submission to the Section 402 2008
Condominium Licensing and marketing Agency Counsel.
Aweemcntby A¢eney Counsel.
9. Opening of Escrow:The:Agency shall open Section 202 June 30,
an escrow for conveyance of the Conveyance 2008
Parcel to the Developer.
10. Title Report. Agency delivers to Developer Within 30 days after Section 206 July 30,
Preliminary Title Report. opening Escrow_ 2008
H. Approval or Disapproval of Title Exceptions. Within 15 days after Section 206 August 15,
Developer approves or disapproves title delivery of Preliminary 2008
exceptions. Title Report to
Developer.
I2_ Aaencv_ delivers Clean Title to Developer. Section 206 October 30,
2008
13. Initial Submission—Hotel Construction Plans Within 270 days after Section 304 March 30,
The Developer shall submit to the City for approval by the City of 2009
review and approval Hotel Building Plans for the Final Planned
the site. Development District.
14. Escrow Fees and Charges. Escrow Agent One(1)week prior to Section 202
gives notice of fees,charges,and costs to Closing.
close Escrow.
15. Submission of Evidence of Mortgage or On or before 1:00 p.m. Section 208
Construction Financin¢. The Developer shall on the last business day
deposit the Evidence of Mortgage or preceding the Closing
Construction Financing into escrow. . Date
16. Deposit of Purchase Price and Developer's On or before 1:00 p.m. Section 208
Share of Escrow Costs,
The Developer shall on the last business day
deposit the Purchase Price of Hotel Parcel and preceding the Closing
Developer's share of escrow costs into Date
escrow,
17. Deposit of Grant Deed and Aeeney's share of On or before 1:00 p.m Section 208
Escrow Costs.The Agency shall deposit the on the last business day
executed grand deed for the Conveyance preceding the Closing
Parcel and Agency's share of escrow costs Date
into escrow_
18. Deposit of Promissory Note and Deed of On or before 1:00 p.m. Section 201
Trust for Condo Parcel.The Developer shall on the last business day
deposit an executed Promissory Note and preceding the Closing
Deed of Trust for the Condo Parcel into Date
escrow.
19. Estoppel Certificate.Certificates evidencing On or before 1:00 p.m. Section 202
insurance. The Developer shall deposit an on the last business day
Estoppel Certificate and Certificate preceding the Closing
Evidencing Insurance into escrow. Date
51
20. Esto el Certificate Tax a er ID Certificate. On or before 1:00 p.m. Section 202
FIRPTA Certificate. The Agency shall on the last business day
deposit an Estoppel Certificate,Taxpayer ID preceding the Closing
Certificate,FIRPTA Certificate. Date
21, Close of Escrow,recordation and delivery of As soon as possible Section 203 November
documents. The Agency shall convey fee title upon Receipt of All 30,2009
to the Conveyance Parcel to the Developer, documents required to
and the Developer shall accept such close.
eonvenyance. The Escrow Agent shall cause
the Grant Deed and Deed of Trust to be
recorded with the Riverside County Recorder.
22. Commencement of Construction of On a schedule that will Section 307 December
Developer's Improvements. The Developer coordinate with the 1, 2009
Within 30 days after receipt thereof by the Developer's
Developer shall commence construction of the construction schedule.
improvements to be constructed on the Site.
23. COmpletion of Construction of Developer's Within 18 months after Section 307 June 1,
Improvements The Developer shall complete commencement of 2011
construction of the Hotel and Condo-Hotel construction.
Units improvements on the Site.
24. Request—Certificate of Completion. The Promptly after Section323 Junel,
Developer shall request from the Agency a completion of all 2011
Certificate of Completion on the Hotel Parcel constmetion required to
Development. be completed by the
Developer on the site.
25. Payment for Condo Parcel. The Developer Prior to issuance of a June 11,
shall make payment to the Agency of the Certificate;of 2011
balance due under the Condo Parcel Completion by the
Promissory Note and the Agency shall cause Agency,
to be recorded a Substitution and
Reconveyance retiring the Promissory Note
and Deed of Trust,
26. Issuance—Certificate of Completion_The Within 10 days after Section 323 June 11,
Agency shall furnish the Developer with a receipt of written 2011
Certificate of Completion on completed request thereof by the
phases of work Developer.
It is understood that the foregoing Schedule of Performance is subject to all of the terms and
conditions set forth in the text of the Agreement. The summary of the items of performance in
this Schedule of Performance is not intended to supersede or modify the more complete
description in the text; in the event of any conflict or inconsistency between this Schedule of
Performance and the text of the Agreement,the text shall govern.
The time periods set forth in this Schedule of Performance may be altered or amended only by
written agreement signed by both Developer and Agency. A failure by either party to enforce a
52
breach of any particular time provision shall not be construed as a waiver of any other time
provision. The Executive Director of Agency shall have the authority to approve extensions of
time without Agency Board action not to exceed a cumulative total of 180 days as provided in
Section 903.
53
ATTACHMENT NO. 4
SCOPE OF DEVELOPMENT
I. PRIVATE DEVELOPMENT
A. General
The Developer agrees that the Site shall be developed and improved in
accordance with the provisions of this Agreement and the plans, drawings and related
documents approved by the Agency pursuant hereto. The Developer and its supervising
architect, engineer and contractor shall work with Agency staff to coordinate the overall
design, architecture and color of the improvements on the Site.
13, Develo ces kn rovements
The Developer shall construct, or cause to be constructed, on the Site a
"four star" Mondrian Hotel of at least two hundred (200) rooms, at least fifty (50)
condominium-hotel rooms, plus not more than one hundred fifty (150) condominium
units, and on-site parking which meets the requirements of the City. A "four star" hotel
means a full service hotel comparable to other Mondrian Hotels in operation as of the
date of this Agreement. The hotel will contain at least ten thousand (10,000) square feet
of`Synder roof' group meeting space and on-site parking which meets the requirements of
the City. The hotel shall provide the Convention Center with no less than one hundred
fifty (150) room block commitment under the Convention Center's Committable Rooms
Program,
C. Architecture and Desien
The Developer's improvements shall be of high architectural quality, shall
be well landscaped and shall be effectively and aesthetically designed. The shape, scale
of volume, exterior design and exterior finish of the building must be consonant with,
visually related to, physically related to and an enhancement of adjacent buildings within
the Project Area. The Developer's plans submitted to the Agency shall describe in detail
the architectural character intended For the Developers improvements.
D. Landscaping
Landscaping shall embellish all open spaces upon the Site to integrate the
Developer's improvements with adjacent sites within the Project Azea. Landscaping
includes such materials as paving, trees, shrubs and other plant materials, landscape
containers, plaza furniture, top soil preparation, automatic irrigation and landscape and
945623v3 35983/0003 Anachmmt Na.4,Page 1 12/13/2007 54
pedestrian lighting. Landscaping shall carry out the objectives and principles of the
Agency's desire to accomplish a high quality aesthetic environment.
E. SiQns
All signs on the exterior of the buildings are of special concern to the
Agency and must be approved by the Agency (which approval shall not be unreasonably
withheld).
F. Screening
Trash areas shall be screened on at least three (3) sides and have movable
doors or other devices to obscure such areas from view. All fire standpipes and such
other fire related mechanical devices shall be screened. Rooftop equipment shall be
reasonably hidden so as to mitigate views from principal elevations surrounding the
development.
G. Applicable Codes
The Developer's improvements shall be constructed in accordance with the
Uniform Building Code(with City modifications) and the Municipal Code.
II. SITE CLEARANCE AND PREPARATION
The Developer shall perform, or cause to be performed, at its sole cost and
expense,the following work:
A. On-Site Demolition and Clearance
1. On the Site,.demolish or salvage, clear, grub and remove
(as may be needed and called for in the approved plans) all
on-site buildings, pavements, walks, curbs, gutters and
other improvements; and
2. Remove, plug and/or crush in place utilities, such as storm
sewers, sanitary sewers, water systems, electrical overhead
and underground systems and telephone and gas systems
located on the Site, as may be required following any
necessary relocation of the utilities.
B. Compaction, Finish Grading and Site Work
The Developer shall compact, finish grade and do such site preparation as
is necessary for the construction of the Developer's Improvements on the Site.
9456330 35983/0003 12113�2007
Attachment No.4,Pagc 2 5 5
III. PUBLIC IMPROVEMFNTS
The Agency shall perform; or cause to be performed, the following work in
connection with the development of the Site by the Developer: NONE
945623v3 35983/0003 Atlathment No.4,Page 3 12/1312007, 56
ATTACHMENT NO. 5
FORM OF GRANT DEED
RECORDING REQUESTED BY
AND WHEN RECORDED MAIL TO.
GRANT DEED
For valuable consideration,the receipt of which is hereby aclaiowledged,
THE REDEVELOPMENT AGENCY OF THE CITY OF PALM SPRINGS, a
public body, corporate and politic, exercising governmental functions and powers and
organized and existing under the Community Redevelopment Law- of the State of
California (Health and Safety Code Section 33000 et seq.) (herein called "Grantor"),
acting to carry out the Redevelopment Plan(herein called "Redevelopment Plan") for the
Pahn Springs Merged Redevelopment Project Area No. 2, under the Community
Redevelopment Law, hereby grants to RE: LOFT PARTNERS PALM SPRINGS, LLC, a
Delaware limited liability company (herein called "Grantee"), the real property (the
"Site") legally described in the document attached hereto, labeled Exhibit A, and
incorporated herein by this reference.
1. The Site is conveyed subject to the Amended and Restated Redevelopment
Plan and pursuant to a Disposition and Development Agreement (the "DDA") entered
into by and between the Grantor and the Grantee and dated 2007. The
Site is also conveyed subject to casements of record.
2. a. The Grantee hereby covenants and agrees, for itself and its
successors and assigns, that during construction and thereafter, the Grantee shall use,
operate and maintain the Site and the improvements thereon only for a four star Mondrian
hotel, and related retail uses as further described in Section 401 of the DDA. The
Grantee shall use the Site and the improvements thereon for no other purpose without the
prior written consent of the Grantor. The foregoing covenant shall run with the land.
9456230 35983/0003 Auua bmem No 5,Page 1 [211302007 57
b. Following completion of construction of the improvements,
Grantee shall maintain in accordance with the Maintenance Standards, as hereinafter
defined, the private improvements and public improvements and landscaping to the
curbline(s)on the Site. Said improvements shall include, but not be limited to,buildings,
sidewalks, pedestrian lighting, landscaping, irrigation of landscaping, architectural
elements identifying the Site and any and all other improvements on the Site and in the
public right-of-way to the nearest curbline(s) abutting the Site. To accomplish the
maintenance, Grantee shall either staff or contract with and hire licensed and qualified
personnel to perform the maintenance work, including the provision of labor, equipment,
materials, support facilities, and any acid all other items necessary to comply with the
requirements of this paragraph.
(1) Maintenance Standards. The following standards
("Maintenance Standards") shall be complied with by Grantee and its maintenance staff,
contractors and subcontractors:
(a) Landscape maintenance shall include, but not be
limited to: watering/irrigation; fertilization;
mowing; edging; trimming of grass; tree and shrub
pruning; trimming and shaping of trees and shrubs
to maintain a healthy, natural appearance, safe road
conditions and visibility, and irrigation coverage;
replacement, as needed, of all plant materials;
control of weeds in all planters, shrubs, lawns,
ground covers, or other planted areas; and staking
for support of trees.
(b). Clean-up maintenance shall include, but not be
limited to: maintenance of all sidewalks, paths and
other paved areas in clean and weed-free condition;
maintenance of all such areas clear of dirt, mud,
.trash, debris or other matter which is unsafe or
unsightly; removal of all trash,litter and other debris
from improvements and landscaping prior to
mowing; clearance and cleaning of all areas
maintained prior to the end of the day on which the
maintenance operations are performed to ensure that
all cuttings, weeds, leaves and other debris are
properly disposed of by maintenance workers-
(c) All maintenance work shall conform to all
applicable federal and state Occupation Safety and
Health Act standards and regulations for the
performance of maintenance.
945623v3 35900003 Attachment No.5,Past 2 121IM007 58
(d) Any and all chemicals, unhealthful substances, and
pesticides used in and during maintenance shall be
applied in strict accordance with all governmental
requirements. Precautionary measures shall be
employed recognizing that all areas are open to
public access-
(c) The improvements shall be maintained in
conformance and in compliance with the
franchise agreement standards, or
equivalent, as the same may be amended from time
to time with the approval of the Grantor and in
accordance with the custom and practice generally
applicable to comparable hotels located within
Riverside County, California.
(2) failure to Maintain Improvements. If Grantee does not
maintain the private and public improvements on the Site to the curbline(s) in the manner
set forth herein and in accordance with the Maintenance Standards, Grantor shall have the
right to maintain such private and/or public improvements, or to contract for the
correction of such deficiencies, after written notice to Grantee. However, prior to taking
any such action, Grantor agrees to notify Grantee in writing if the condition of said
improvements does not conform to the Maintenance Standards and to specify the
deficiencies and the actions required to be taken by Grantee to cure the deficiencies.
Upon notification of any maintenance deficiency, Grantee shall have thirty (30) days
within which to commence to correct, remedy or cure the deficiency and thereafter
diligently and continuously complete correction, remedy or cure of the deficiency. If the
written notification states that the problem is urgent and relates to the public health and
safety,then Grantee shall have forty-eight(48) hours to rectify the problem.
In the event Grantee fails to correct, remedy, or cure or has not
commenced correcting, remedying or curing such maintenance deficiency after
notification and after expiration of any applicable cure period, then Grantor shall have the
right to maintain such improvements. Grantee agrees to pay Grantor such charges and
costs upon demand. Until so paid, the Grantor shall have a lien on the Site for the
amount of such charges or costs, which lien shall be perfected by the recordation of a
"Notice of Claim of Lien" against the Site. Any lien in favor of the Grantor created or
claimed hereunder is expressly made subject and subordinate to any mortgage or deed of
trust made in hood faith and for value, recorded as of the date of the recordation of the
Notice of Claim of Lieu, and no such lien shall in any way defeat, invalidate, or impair
the obligation or priority of any such mortgage or deed of trust, unless the mortgagee or
beneficiary thereunder expressly subordinates his interest, of record, to such lien. No lien
in favor of the Grantor created or claimed hereunder shall in any way defeat, invalidate,
or impair the obligation or priority of any lease, sublease or easement unless such
instrument is expressly subordinated to such lien. Grantee acknowledges and agrees that
9456230 359S310003 Attachmmc No.5,Page 3 12/13/2007 59
the Grantor and Grantor may also pursue any and all other remedies available in law or
equity in the event of a breach of the maintenance obligations and covenants set forth
herein.
3. Prior to the issuance of a Certificate of Completion by the Grantor as
Provided in Section 323 of the DDA, the Grantee shall not, except as permitted by the
DDA, sell, transfer, convey, assign or lease the whole or any part of the Site without the
prior written approval of the Grantor. This prohibition shall not apply subsequent to the
issuance of the Certificate of Completion with respect to the improvements upon the
Hotel Parcel. This prohibition shall not be deemed to prevent the granting of easements
or permits to facilitate the development of the Site or to prohibit or restrict the leasing of
any part or parts of a building or structure when said improvements are completed.
4, Grantee hereby grants to Grantor the option to repurchase the Site hereby
conveyed and all improvements subsequently constructed thereon, if prior to the issuance
of a Certificate ol'Completion pursuant to Section 323 of the DDA, Grantee shall:
a. Fail to commence construction of approved improvements on the
Site within the time established therefor in the DDA, for any reason
whatsoever. , For purposes of this provision, the Developer shall
be deemed to "commence construction" when and only when the
Developer has received City approval of the final plans and
specifications for all improvements provided in this Agreement,
completed rough grading on the Site, and commenced installation
and construction of improvements provided herein pursuant to
permits issued by the City for the construction of such
improvements; or
b. Once construction has been commenced in accordance with
subparagraph 1 above, fail to diligently prosecute construction of
the improvements through completion within the time established
therefor in the DDA, where such failure has not been cured within
three (3)months after written notice thereof from the Grantor; or
C. Abandon or substantially suspend construction o f the improvements
for a period of three (3) months after written notice of such
abandonment or suspension from the Grantor, or
d. Without the prior written consent of Grantor, directly or indirectly,
voluntarily or involuntarily sell, assign, transfer, dispose of or
further encumber or agree to sell, assign, transfer, dispose of or
further encumber or suffer to exist any other lien against all or any
portion of or any interest in the Site, except for any sale,
assignment, transfer, disposal or encumbrance that is expressly
permitted by the terms of the DDA. For the purpose of this
paragraph, the tetras "sell" and "transfer" shall include, in addition
94562303 35983/0003 Attachment No.5,Page 4 12/13/2007 60
to the common and ordinary meaning of those terms and without
limiting their generality, transfers made to subsidiary or affiliated
entities, and any "change in ownership" as that term is used from
time to time in California real property taxation law, irrespective of
the fact that the Site may be exempt from such transaction during
the period when owned by Grantor.
This option shall be subordinate and subject to and be limited by and shall
not defeat, render invalid or limit:
a. Any mortgage, deed of trust or other security instrument permitted
by the DDA; or
b. Any rights or interests provided in the DDA for the protection of
the holder of such mortgages, deeds of trust or other security
instruments.
To exercise its right to repurchase, reenter and take possession with
respect to the Site,the Grantor shall pay to the Grantee in cash an amount equal to:
a. The cash Purchase Price for the Site paid by the Grantee;plus
b. The costs actually incurred by the Developer for"hard" and "soft"
costs related to the site and the improvements to be constructed
thereon, including, without limitation, architectural, engineering
and legal fees, fees paid to any governmental entity, and the cost of
all on-site labor and materials for the construction of the
improvements existing on the Site at the time of the repurchase,
reentry and repossession,exclusive of amounts financed; less
C. Any gains or income withdrawn or made by the Grantee from the
Site or the improvements thereon; and less
d. The amount of any unpaid assessments and any liens against the
Site.
5_ The Grantor shall have the additional right, at its option, to terminate the
estate conveyed to the Grantee, to reenter and take possession of the Site with all
improvements thereon and to revest in the Grantor the estate theretofore conveyed to the
Grantee, if after conveyance of title to the Site and pnor to issuance of the Certificate of
Completion for the Hotel.Parcel, the Grantee shall
a. Fail to commence construction of approved improvements on the
Site within the time established therefor in the DDA, for any reason
wbatsoever. For purposes of this provision, the Grantee shall be
deemed to "commence construction" when and only when the
945623v335953/0003 Attachment No 5,PagcS IM3/2007 61
Grantee has received City approval of the final plans and
specifications for all improvements provided in this Agreement,
completed rough grading on the Site, and commenced installation
and construction of improvements provided herein pursuant to
permits issued by the City for the construction of such
improvements; or
b. Once construction has been commenced in accordance with
subparagraph a. above, fail to diligently prosecute construction of
the improvements through completion within the time established
therefor in the DDA, where such failure has not been cured within
three(3)months after written notice thereof from the Grantor; or
c. Abandon or substantially suspend construction of the improvements
for a period of three (3) months after written notice of such
abandonment or suspension from the Grantor; or
d. Without the prior written consent of Grantor, directly or indirectly,
voluntarily or involuntarily sell, assign, transfer, dispose of or
further encumber or agree to sell, assign, transfer, dispose of or
further encumber or suffer to exist any other hen against all or any
portion of or any interest in the Site, except for any sale or transfer
that is expressly permitted by the tears of the DDA. For the
purpose of this paragraph, the terms "sell" and "transfer" shall
include, in addition to the common and ordinary meaning of those
terms and ikithout limiting their generality, transfers made to
subsidiary or affiliated entities, and any "change in ownership" as
that term is used hum time to time in California real property
taxation law, irrespective of the fact that the Site may be exempt
from such transaction during the period when owned by Grantor.
The interest created pursuant to this paragraph 5 shall be a "power of
termination" as defined in Califomia Civil Code Section 885,010, and shall be separate
and distinct from Agency's option. to repurchase the Site under the same or similar
conditions specified in paragraph 4 above. The Grantor's power of termination shall be
subordinate and subject to and be limited by and shalt not defeat, render invalid or limit:
a. Any mortgage, deed of trust or other security instrument permitted
by the DDA; or
b. Any rights orinterest provided in the DDA for the protection of the
holder of such mortgages, deeds of trust or other security
instruments.
Upon revesting title to the Site or any part thereof in the Grantor as
provided in this paragraph 5,the Grantor shall use its best efforts to resell the Site or part
945623v3 35983/0003 Attachment No 5,Page 6 12/13/2007 62
thereof as soon and in such manner as the Grantor shall find feasible to a qualified and
responsible party or parties (as determined by the Grantor) who will assume the
obligation of making or completing the improvements, or such other improvements in
their stead, as shall be satisfactory to the Grantor and in accordance with the uses
specified for the Site or part thereof in the Redevelopment Plan. Upon such resale of the
Site,the proceeds thereof shall be applied:
a. Firs[, to reimburse the Grantor for all costs and expenses incurred
by the Grantor, including, but not limited to, salaries to personnel in
connection with the recapture, management and resale of the Site or
part thereof(but less any income derived by the Grantor from the
Site or part thereof in connection with sueb management); all taxes,
assessments and water and sewer charges with respect to the Site or
part thereof (or, in the event the Site is exempt from taxation or
assessment or such charges during the period of ownership, then
such taxes, assessments or charges as determined by the County
assessing official as would have been payable if the Site were not
so exempt); any payments made or necessary to be made to
discharge or prevent from attaching or being made any subsequent
encumbrances or liens due to obligations, defaults or acts of the
Grantee; any expenditures made or obligations incurred with
respect to the making or completion of the improvements or any
part thereof on the Site or part thereof; and any amounts otherwise
owing the Grantor by the Grantee; and
b. Second, to reimburse the Grantee the sum of the following: (i) the
cash purchase price for the Site paid by the Grantee; plus (ii) any
cash payments previously made by the Grantee for the development
of the Site and for the improvements existing on the Site at the time
of the reentry.and repossession, exclusive of amounts financed; less
(iii) any gains or income withdrawn or made by the Grantee from
the Site or the improvements thereon; and less (iv) the amount of
any unpaid assessments against the Site.
Any balance remaining after such reimbursements shall be retained by the
Grantor as its property.
As set forth above, this section is intended to create and reserve in the
Grantor a "power of termination" under California law, and not a forfeiture. The
terms and provisions of this Section shall be construed in light of the fact that the
Grantor will convey the Site to the Grantee for development pursuant to the
Redevelopment Plan, and not for speculation in undeveloped land.
6. The Grantee covenants by and for itself and any successors in interest that
there shall be no discrimination against or segregation of any person or group o£persons
on any basis listed in subdivision (a) or(d) of Section 12955 of the Government Code, as
9456230 35983/0003 Amchm�n No.5,Page 7 12/33/2007 63
those bases are defined in Section 12926, 12926.1, subdivision (in) and paragraph (1) of
subdivision (p) of Section 12955, and Section 12955.2 of the Government Code in the
sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the Site, nor shall
the Grantee itself or any person claiming under or through it establish or permit any such
practice or practices of discrimination or segregation with reference to the selection,
location, number, use or occupancy of tenants, lessees, subtenants, sublessees or vendors
in the Site.
All deeds, leases or contracts made relative to the Site, the improvements
thereon or any part thereof shall contain or be subject to substantially the following
nondiscrimination clauses:
a. In deeds: "The grantee herein covenants by and for himself
or herself, his or her heirs, executors, administrators, and
assigns, and all persons claiming under or through them,
that there shall be no discrimination against or segregation
of any person or group of persons on any basis listed in
subdivision (a) or (d) of Section 12955 of the Government
Code, as those bases are defined in Section 12926, 12926.1,
subdivision (m) and paragraph (1) of subdivision (p) of
Section 12955, and Section 12955 2 of the Government
Code in the sale, lease, sublease, transfer, use, occupancy,
tenure or enjoyment of the premises herein conveyed, nor
shall the grantee, or any person claiming under or through
him or her, establish or permit any such practice or
practices of discrimination or segregation with reference to
the selection, location, number, use or occupancy of
tenants, lessees, subtenants, sublessees or vendees in the
premises herein conveyed. The foregoing covenants shall
run with the land."
b. In leases: "The lessee herein covenants by and for himself
or herself, his or her heirs, executors, administrators and
assigns, and all persons claiming under or through him or
her, and this lease is made and accepted upon and subject to
the following conditions:
"That there shall be no discrimination against or
segregation of any person or group of persons on any basis
listed in subdivision (a) or (d) of Section 12955 of the
Government Code, as those bases are defined in Section
12926, 12926.1, subdivision (m) and paragraph (1) of
subdivision (p) of Section 12955, and Section 129552 of
the Government Code in the leasing, subleasing,
transferring, `use, occupancy, tenure or enjoyment of the
premises herein leased, nor shall the lessee himself or
945623v3 35983/0003 Anachmem No.5,Pa-,a 8 12/13/2007 64
herself, or any person claiming under or through him or
her, establish or permit any such practice or practices of
discrimination or segregation with reference to the
selection, location, number, use or occupancy of tenants,
lessees, sublessees, subtenants or vendees in the premises
herein leased."
C. In contracts: "There shall be no discrimination against or
segregation of any person or group of persons on any basis
listed in subdivision (a) or (d) of Section 12955 of the
Government Code, as those bases are defined in Section
12926, 12926.1, subdivision (m) and paragraph (1) of
subdivision (p) of Section 12955, and Section 12955.2 of
the Government Code in the sale, lease, sublease, transfer,
use, occupancy, tenure or enjoyment of the premises, nor
shall the transferee himself or herself, or any person
claiming under or through him or her, establish or permit
any such practice or practices of discrimination or
segregation with reference to the selection, location,
number, use or occupancy of tenants, lessees, sublessees,
subtenants or vendees in the premises."
7. No violation or -breach of the covenants, conditions, restrictions,
provisions or limitations contained in this Grant Deed shall defeat or render invalid or in
any way impair the lien or charge of any mortgage, deed of trust or other financing or
security instrument permitted by the DDA, provided, however, that any successor of
Grantee to the Site shall be bound by such remaining covenants, conditions, restrictions,
limitations and provisions, whether such successor's title was acquired by foreclosure,
deed in lieu of foreclosure,trustee's sale or otherwise.
8. Except as otherwise provided, the covenants contained in paragraph 2 of
this Grant Deed shall remain in effect unfil (the termination date of the
Redevelopment plan). The covenants against discrimination contained in paragraph 6 of
this Grant Deed shall remain in perpetuity. The covenants contained in paragraphs 3, 4
and 5 shall remain in effect until issuance of a Certificate of Completion pursuant to
Section 323 of the DDA.
9. The covenants contained in paragraphs 2, 3, 4, 5 and 6 of this Grant Deed
shall be binding for the benefit of the Grantor, its successors and assigns, and any
successor in interest to the Site or airy part thereof, and such covenants shall run in favor
of the Grantor and such aforementioned parties for the entire period during which such
covenants shall be in force and effect, without regard to whether the Grantor is or remains
an owner of any land or interest therein to which such covenants relate. The Grantor and
such aforementioned parties, in the event of any breach of any such covenants, shall have
the right to exercise all of the rights and remedies and to maintain any actions at law or
suits in equity or other proper proceedings to enforce the curing of such breach. The
945623v3 3598310003 Allachmml No,5,Pagc 9 12/132007 65
covenants contained in this Grant Deed shall be for the benefit of and shall be.
enforceable only by the Grantor,its successors and such aforementioned parties.
10. In the event of any express conflict between this Grant Deed or the DDA,
the provisions of this Grant Deed shall control-
It. Any amendments to the Redevelopment Plan that change the uses or
development pennitted on the Site or change the restrictions or controls that apply to the
Site or otherwise affect the Site shall require the written consent of the Grantee.
Amendments to the Redevelopment Plan applying to other property in the Project Area
shall not require the consent of the Grantee.
IN WITNESS WHEREOF, the Grantor and Grantee have caused this instrument
to be executed on their behalf by their respective officers thereunto duly authorized
this_day of 2007.
COMMUNITY REDEVELOPMENT
AGENCY OF THE CITY OF PALM
SPRINGS, a public body, corporate and
politic
By:
Title:
"GRANTOR"
Approved as to form:
Agency Counsel
9456230 35983/0003 Attachment No.5,Page 10 1:/13I3UU?. 66
The provisions of this Grant Deed are hereby approved and accepted.
2007 RE: LOFT PARTNERS PALM SPRINGS,
LLC, a Delaware limited liability company
By:
Title:
"GRANTEE"
945623v3 35983/0003 ALtathmeni Nu,5,Pugc 11 12/13/2007 67
ACKNOWLEDGMENTS
9456230 35933/0003 Attachm�u No-5,Acknowledgments 12/13/2007 68
EXHIBIT A
LEGAL DESCRIPTION OF THE SITE
Agency Parcel:
All that certain real property located in the City of Palm Springs, County of Riverside,
State of California, more particularly described as follows:
BLOCKS 103, 105 AND 106 1N SECTION 14, TOWNSHIP 4 SOUTH, RANGE 4
EAST, SAN BERNARDINO MERIDIAN, IN THE CITY OF PALM SPRINGS,
COUNTY OF RIVERSIDE, STATE OF CALIFORNIA, ACCORDING TO THE
OFFICAL PLAT THEREOF.
Developer Parcel:
BLOCK 102 IN SECTION 14, .TOWNSHIP 4 SOUTH, RANGE 4 FAST, SAN
BERNARDINO MERIDIAN, IN THE CITY OF PALM SPRINGS, COUNTY OF
RIVERSIDE, STATE OF CALIFORNIA, ACCORDING TO THE OFFICAL PLAT
THEREOF,
945623v33598310003 AttachmmtNo 5 12/13/2007 6` f�
ATTACHMENT NO. 6
PROMISSORY NOTE
[To Be Produced with Escrow Documents.]
9456230 35983/0003 Attachment Na-7 I?J13+7-007
70
ATTACHMENT NO. 7
DEED OF TRUST
[To Be Produced with Escrow Documents]
a1160844 3
9456230 35983/0003 Attwhment No.8 12/13/2007 71
PURCHASE AND SALE AGREEMENT
This Purchase and Sale Agreement (this "Agreement") is made by and between City of
Palm Springs ('Owner') and CDI Ventures, LLC and/or its affiliates, assigns, successors
("Developer"). In consideration of the mutual covenants and representations herein contained,
and other good and valuable consideration the receipt and sufficiency of which are hereby
acknowledged, Owner and Developer agree as follows:
1. Purpose o/ This Agreement: The purpose of this Agreement is to provide for the
development and maintenance of the Dolce Hotel Project ("Dolce"), a First Class Superior Hotel
(Four+ stars), on property ("Site") in close proximity to the City's Convention Center
("Convention Center"), consistent with the adopted plans and policies of the City. The Dolce
will enhance the vibrant commercial and tourist core near the City's downtown area and ensure
the availability of significant and necessary hotel, meeting, and conference uses near the
Convention Center. The operation of the Dolce will provide needed first class hotel facilities
that will compliment and advance the use of the Convention Center and attract high-end visitors
to the City and encourage a wider range of attractions, activities, and events at the Convention
Center. The Dolce will consist of at least two hundred (200) hotel rooms, (15,000) square feet of
"under-roof group meeting space, two restaurants, a lounge and bar, spa and workout amenities,
and on-site parking which meet the requirements of the City. The development of the Site
pursuant to this Agreement and the fulfillment generally of this Agreement are in the vital and
best interests of the City, and the health, safety, and welfare of its residents and in accord with
the public purposes and provisions of applicable federal, state, and local laws and requirements.
2. Owner: City of Palm Springs, a charter city organized under the laws of the State
of California. The office of the City is located at 3200 East Tahquitz Canyon Way, Palm
Springs, CA, 92263. The term "City" as used in this Agreement includes any assignee or
successor to the City's rights, powers, and responsibilities under law.
3. Developer and Purchasing F,ntity: CDI Ventures, LLC, a California limited
liability company. The principal office of the Developer is located at 9190 W Olympic Blvd.,
No. 412, Beverly Hills, CA 90212. The term "Developer" as used in this Agreement includes
any permitted transferee, conveyee, or assignee of the Developer with the qualifications and
financial responsibility necessary and adequate, consistent with the provisions of this Agreement
and as may be reasonably determined by the City, to fulfill the obligations undertaken in this
Agreement by the Developer.
4. Site: The Site consists of two properties. The first is the City owned property
("City Property") of approximately 7.8 acres comprised of 3 lots identified as APN's: 508-034-
012; 508-034-013; 508-034-014, located in the County of Riverside, City of Palm Springs, and
generally located at the northeast corner of Amado and Calle Alvarado, The City Property is
currently used as a public parking lot. The City shall convey in fee all of the City Property to the
Developer, and the Developer shall acquire, develop, and maintain the City Property in
accordance with the terms and provisions of this Agreement. The City Property is shown on the
Map of the Site (Attachment No. 1) and is more particularly described in the Legal Description
72
I
914973.1
of the Site (Attachment No. 2). The second property ("Developer Property") is an approximately
2.7 acre parcel immediately north of the City Property. Developer shall acquire, develop, and
maintain the Developer Property in accordance with the terns and provisions of this Agreement.
The Developer Property is shown on the Map of the Site (Attachment No. 1) and is more
particularly described in the Legal Description of the Site (Attachment No. 2). The City
Property and the Developer Property are collectively referred to in this Agreement as the Site.
The Parties acknowledge both the City Property and the Developer Property are necessary for the
development of the Dolce in order to meet the minimum lot size required to achieve the height,
mass, and set-back requirements of the City's zoning and land use requirements and regulations-
5- Purchase Price of the City Property: Two Million United States Dollars
(S2,000,000)
6. Required Use of the Site: Construction and maintenance of the Dolce Palm Springs
Project, a Dolce brand, Upper upscale, first class superior (four+ star) hotel, with at least 200
guest rooms, 15,000 square feet of meeting space, two restaurant(s), a lounge & bar, spa and
workout amenities, parking for the hotel which meets the minimum parking requirements of the
City, and other features as determined as appropriate by CDI. Developer acknowledges and
understands that the City Property will be conveyed to the Developer for the purpose of
development pursuant to this Agreement and not for speculation in undeveloped land-
7- Purchase Date: Property shall be purchased on the start of construction by
Developer but no later than December 31, 2013. Escrow shall be opened no less than 45 days
before the anticipated Purchase Date.
8. Fscrox: The City agrees to open an escrow with an escrow company located in the
City of Palm Springs, California (the "Escrow Agent") within the time established above in
Section 8 for the purpose of conveying fee title of the City Property to the Developer. This
Agreement constitutes the joint escrow instructions of the City and the Developer, and a
duplicate original of this Agreement shall be delivered to the Escrow Agent upon the opening of
escrow. The City and the Developer shall provide such additional escrow instructions as shall be
necessary and consistent with this Agreement. The Escrow Agent hereby is empowered to act
under this Agreement and, upon indicating its acceptance of the provisions of this Section in
writing, deliver to the City and to the Developer within five (5) days after the opening of the
escrow, then shall carry out its duties as Escrow Agent hereunder.
a. Prior to the opening of escrow, the Developer shall submit to the City
Attorney, for approval by the City Attorney in his sole reasonable discretion, a proposed
Financing Plan that shall include:
W a cash flow projection for operation of the Dolce;
(ii) a cost breakdown for development based upon government permits
and approvals and any design documents;
73
914973.1
(iii) a sources and uses table identifying the proposed use of each source
of funding for the Project during the construction period; and
(iv) evidence reasonably satisfactory to the City Attorney that the
Developer has sufficient additional funds available and is able to commit such funds to cover
the difference, if any, between costs of development of the Project and the amount available to
the Developer from external sources.
b. The City Attomey's review of the Financing Plan shall be for the purposes
of determining if the contemplated financing will be reasonably available, will provide
sufficient funds for construction of the Project, and for its operation consistent with the terms of
this Agreement and will otherwise be provided on terms consistent with the terms and
conditions of this Agreement.
C. Upon opening of Escrow per this Section 9, the Developer shall deposit with
the Escrow Agent $500,000.00 as an initial non-refundable deposit ("Deposit") to be applied
against the Purchase Price. The Deposit shall be forwarded by wire transfer in accordance with
wire transfer instructions provided by the Escrow Agent, to be invested by the Escrow Agent in
a federally insured interest-bearing account as approved by the Parties. Owner shall have the
option of ter imating this Agreement if the full amount of the Deposit is not delivered to the
Title Company as prescribed herein. The Deposit shall be non-refundable except as otherwise
expressly provided elsewhere in this Agreement. The Deposit shall be applied against the
Purchase Price. Developer agrees to promptly deliver or cause the Title Company to deliver
written acknowledgment by the Title Company that the executed copy of this Agreement and
the Deposit have been received by and are being held by the Title Company in accordance with
the terms of this Agreement. If the sale of the Property is consummated under this Agreement,
the Deposit shall be paid to Owner and applied to the payment of the Purchase Price at Closing.
If Developer terminates this Agreement solely in accordance with any right to terminate granted
to Developer by the terms of this Agreement, the Deposit shall be returned to Developer within
3 days, and no party hereto shall have any further obligations under this Agreement except for
such obligations which by their terms expressly survive the termination of this Agreement (the
"Surviving Obligations"); provided, however, that in no event shall any portion of the Deposit
be refundable to Developer in connection with any termination by Developer pursuant to the
provisions of Section 12 of this Agreement.
d. Prior to the close of escrow, Developer shall deposit with the Escrow Agent
the balance of the Purchase Price ($2 Million Dollars less the 5500,000 Deposit) by wire
transfer in accordance with wire transfer instructions provided by the Escrow Agent.
e. The Developer shall also pay into escrow the following fees, charges and
costs promptly after the Escrow Agent has notified the Developer of the amount of such fees,
charges and costs, but not earlier than ten (10) days prior to the scheduled date for the close of
escrow.
W One-half(1/2) of the escrow fee; and
?4
3
914973.1
(i i) The portion of the premium for the title insurance policies or special
endorsements to be paid by the Developer as set forth in the additional escrow instructions.
f The City shall timely and properly execute, acknowledge and deliver a deed
conveying to the Developer fee title to the City Property in accordance with the requirements as
set forth herein together with an estoppel certificate certifying that the Developer has completed
all acts (except deposit of the Initial Deposit) necessary to entitle the Developer to such
conveyance, if such be the fact.
g. The City shall pay into escrow to the Escrow Agent the following fees,
charges and costs promptly after the Escrow Agent has notified the City of the amount of such
fees, charges and costs, but not earlier than ten (10) days prior to the scheduled date for the close
of escrow:
(i) Costs necessary to place the title to the City Property in the condition
for conveyance required by the provisions of this Agreement;
(ii) One-half(1/2) of the escrow fee;
(iii) Cost of preparing the deed;
(iv) Recording fees;
(v) Notary fees;
(vi) The premium for an A.L.T.A_ standard title insurance owners policy
to be paid by the City and the cost for a corresponding A.L.T.A. survey;
(vii) Ad valorem taxes, if any, upon the City Property for any time prior
to conveyance of title; and
(viii) Any state, county or city documentary transfer tax.
h. Upon delivery of the deed to the Escrow Agent by the City, and the
completion and satisfaction of all pre-conditions for closing as provided in this Agreement,
including without limitation the deposit of the full purchase price and the delivery of Evidence of
Financing per 9.a.iv above, the Escrow Agent shall record such deed. Title can be vested in the
Developer in accordance with the terns and provisions of this Agreement. Immediately
thereafter, Escrow Agent shall record the Deed of Trust. The Escrow Agent shall buy, affix and
cancel any transfer stamps required by law and pay any transfer tax required by law. Any
insurance policies governing the City Property are not to be transferred.
i. The Escrow Agent is authorized to:
(i) Pay and charge the City and the Developer, respectively, for any
fees, charges and costs payable under this Agreement. Before such payments are made, the
75
4
914973.1
Escrow Agent shall notify the City and the Developer of the fees, charges and costs necessary to
clear title and close the escrow;
(ii) Disburse funds and deliver the deed and other documents to the
parties entitled thereto when the conditions of this escrow have been fulfilled by Y and th
e
the City
Developer; and
(iii) Record any instruments delivered through this escrow, if necessary
or proper, to vest title in the Developer in accordance with the terms and provisions of this
Agreement.
j. All funds received in this escrow shall be deposited by the Escrow Agent in
an escrow account or accounts with any state or national bank doing business in the State of
California. All disbursements shall be made by check of the Escrow Agent. All adjustments
shall be made on the basis of a thirty (30) day month.
k. Any amendment of these escrow instructions shall be in writing and signed
by both the City and the Developer. At the time of any amendment, the Escrow Agent shall
agree to carry out its duties as Escrow Agent under such amendment.
1. All communications from the Escrow Agent to the City or the Developer
shall be directed to the addresses and in the manner established in this Agreement for notices,
demands and communications between the City and the Developer.
m. The liability of the Escrow Agent under this Agreement is limited to
performance of the obligations imposed upon it under this Agreement.
n. Neither the City nor the Developer shall be liable for any real estate
commissions or brokerage fees that may arise here from. The City and the Developer each
represent that neither has engaged any broker, agent or finder in connection with this transaction.
9. Conveyance of Title and Delivery of Possession: Provided that the Developer is not in
default under this Agreement and all conditions precedent to such conveyance have occurred,
and subject to any mutually agreed upon extensions of time, conveyance to the Developer of fee
title to the City Property shall be completed on or prior to the date specified in this Agreement.
The City and the Developer agree to perform all acts necessary to conveyance of title in
sufficient time for title to be conveyed in accordance with the foregoing provisions.
a. Possession shall be delivered to the Developer concurrently with the
conveyance of title, except that limited access may be permitted before conveyance of title for
the purpose of obtaining data and making surveys and tests necessary to carry out this
Agreement. The Developer shall hold the City harmless from any injury or damages arising out
of any activity pursuant to this section. The Developer shall have access to all data and
information on the Site available to the City, but without warranty or representation by the City
as to the completeness, correctness or validity of such data and information.
76
5
914973.1
b. Any preliminary work undertaken on the City Property by the Developer
prior to conveyance of title thereto shall be done only after written consent of the City and at the
sole expense of the Developer. The Developer shall save and protect the City against any claims
resulting from such preliminary work, access or use thereof. Copies of data, surveys and tests
obtained or made by the Developer shall be filed with the City. Any preliminary work by the
Developer shall be undertaken only after securing any necessary permits from the appropriate
governmental agencies.
10. Inspections and Conditions of the Site.
a. Inspections: Developer has conducted a Phase I Environmental Study and
Soils Analysis of the Site and is satisfied with their condition. No further analysis or studies of
the Site are required.
b. "As Is": Developer agrees it will rely solely on its own investigation and
agrees to purchase the Site "as is," in its current physical condition, with no warranties, express
or implied, as to the physical condition thereof, the presence or absence of any latent or patent
condition thereon or therein, including, without limitation, any Hazardous Materials (as defined
herein) thereon or therein.
C. Developer Indemnity: Developer agrees, from and after close of escrow, to
defend, indemnify, protect and hold harmless the City and its officers, beneficiaries, employees,
agents, attorneys, representatives, legal successors and assigns ("Indemnitees") from, regarding
and against any and all liabilities, obligations, orders, decrees, judgments, liens, demands,
actions, Environmental Response Actions (as defined herein), claims, losses, damages, fines,
penalties, expenses, Environmental Response Costs (as defined herein) or costs of any kind or
nature whatsoever, together with fees (including, without limitation, reasonable attorneys' fees
and experts' and consultants' fees), whenever arising, unless caused in whole or in part by any of
the Indemnitees, resulting from or in connection with the actual or claimed generation, storage,
handling, transportation, use, presence, placement, migration and/or release of Hazardous
Materials (as defined herein), at, on, in, beneath or from the Site (collectively referred to as
"Contamination"). Developer's defense, indemnification, protection and hold harmless
obligations herein shall include, without limitation, the duty to respond to any governmental
inquiry, investigation, claim or demand regarding the Contamination, at Developer's sole cost.
d. Release and Waiver. The Developer hereby releases and waives all rights,
causes of action and claims Developer has or may have in the future against the Indemnitees
arising out of or in connection with any Hazardous Materials (as defined herein), at, on, in,
beneath or from the Site, unless the presence of such Hazardous Materials at, on, in, beneath or
from the Site is caused in whole or in part by any of the Indemnitees. In furtherance of the
intentions set forth herein, Developer acknowledges that it is familiar with Section 1542 of the
Civil Code of the State of California, which provides as follows:
"A general release does not extend to claims which the
creditor does not know or suspect to exist in his or her favor
at the time of executing the release, which if known by him
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or her must have materially affected his or her settlement
with the debtor."
Developer hereby waives and relinquishes any right or benefit which it has
or may have under Section 1542 of the Civil Code of the State of California or any similar
provision of the statutory or non-statutory law of any other applicable jurisdiction to the full
extent that it may lawfully waive all such rights and benefits pertaining to the subject matter of
this Section.
11. Definitions
a. As used in this Agreement, the term "Environmental Response Actions"
means any and all activities, data compilations, preparation of studies or reports, interaction with
environmental regulatory agencies, obligations and undertakings associated with environmental
investigations, removal activities, remediation activities or responses to inquiries and notice
letters, as may be sought, initiated or required in connection with any local, state or federal
governmental or private party claims, including any claims by Developer or City.
b. As used in this Agreement, the term "Environmental Response Costs"
means any and all costs associated with Environmental Response Actions including, without
limitation, any and all fines, penalties and damages.
C. As used in this Agreement, the tern "Hazardous Materials" means any
substance, material or waste which is (1) defined as a "hazardous waste," "hazardous material,"
"hazardous substance," "extremely hazardous waste," "restricted hazardous waste," "pollutant' or
any other terms comparable to the foregoing terns under any provision of California law or
federal law; (2) petroleum; (3) asbestos; (4) polychlorinated biphenyls; (5) radioactive materials;
or (6) determined by California, federal, or local government authority to be capable of posing a
risk of injury to health, safety, or property.
12_ Materiality: Developer acknowledges and agrees that the defense, indemnification,
protection and hold harmless obligations of Developer for the benefit of the City set forth in this
Agreement are a material element of the consideration to the City for the performance of its
obligations under this Agreement, and that the City would not have entered into this Agreement
unless Developer's obligations were as provided for herein. Developer further acknowledges and
agrees that the provisions of this Section which extend representations, warranties,
indemnifications, and/or covenants of Developer to the benefit of the City shall not be satisfied,
waived or otherwise extinguished by City's issuance of any Certification of Completion under
Section 323 of this Agreement.
13. Zoning of the Site: The City and the Developer agree that on the date of execution of
this Agreement the Site is zoned so as to permit the development and construction, of
improvements in accordance with the provisions of this Agreement and the use, operation and
maintenance of such improvements.
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14. Prelinlinary Work by the Developer: Prior to the conveyance of title from the City,
representatives of the Developer shall have the right of access to the City Property at all
reasonable times for the purpose of obtaining data and making surveys and tests necessary to
carry out this Agreement. The Developer shall hold the City harmless from any injury or
damages arising out of any activity pursuant to this section. The Developer shall have access to
all data and information on the Site available to the City, but without warranty or representation
by the City as to the completeness, correctness or validity of such data and information.
Any preliminary work undertaken on the Site by the Developer prior to conveyance of
title thereto shall be done only after written consent of the City and at the sole expense of the
Developer. The Developer shall save and protect the City against any claims resulting from such '
preliminary work, access or use thereof. Copies of data, surveys and tests obtained or made by
the Developer shall be filed with the City. Any preliminary work by the Developer shall be
undertaken only after securing any necessary permits from the appropriate governmental
agencies.
15. Anticipated Opening Date of the Dolce: December 2015
16. Benchmark Schedule:
Entitlements: No later than June 30, 2013 for completion of Planned
Development Amendment including City Council approvals and receipt of
entitlements if required.
Start of Construction: No later than December 31, 2013
Opening Date: Expected December 31, 2015 but no later than March 2016.
17. Owner's Obligations at the Closing. At the Closing, or at such other time as indicated
below, Owner shall deliver to Developer the following:
a. Title Policy. Within a reasonable period of time following Closing, an
Owner's Policy of Title Insurance in California standard form (the "Owner's Policy"), issued by
Title Company on behalf of Fidelity Title Insurance Company, naming Developer as insured, in
the amount of the Purchase Price, insuring that Developer owns good and indefeasible fee simple
title to the Property, subject only to the Permitted Encumbrances and routine exceptions required
by the title insurer. Developer, at Developer's sole expense, may elect to obtain additional or
extended coverage or endorsements over the base Owner's Policy, but obtaining such additional
coverage or endorsements will not be a condition precedent to Developer's Closing obligations
pursuant to this Agreement.
b. Evidence of Authority. Such authorizing documents of Owner as shall be
reasonably required by the Title Company to evidence Owner's authority to consummate the
transactions contemplated by this Agreement.
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18. Developer's Obligations at the Closing. Prior to Closing, Developer shall deliver to
Owner the following:
a. Purchase Price. The Purchase Price by wire transfer of immediately
available funds.
b. Evidence of Authority. Such organizational and authorizing documents of
Developer as shall be reasonably required by Owner and/or the Title Company authorizing
Developer's acquisition of the Property pursuant to this Agreement and the execution of this
Agreement and any documents to be executed by Developer at the Closing.
C. Taxpayer I.D. Certificate. Taxpayer I.D. Certificate, in the form attached to
this Agreement as Exhibit E.
d. Title Insurance Requirements. Such customary affidavits, certificates,
authority documentation and other documents as the Title Company may reasonably require of
Developer to issue the Owner's Policy.
e. Evidence of Financing. Developer shall have submitted to the City Attorney
at least 10 business days before closing, the following evidence of financing:
(i) Demonstration to the satisfaction of the City Attorney or designee
the availability of funds sufficient to pay all costs relating to acquisition of the City Property and
development of the Dolce on the Site, including sufficient equity capital, bonding capacity and
borrowing ability to fund the Dolce in writing from a Permitted Mortgagee(s).
(ii) A letter from a Qualified Institutional Lender to the effect that the
Developer has established a commercial account with such financial institution and maintains a
good relationship with such financial institution.
(iii) Developer and its financing partner shall evidence the ability to or
have secured a Construction Loan for the Project which shall demonstrate to the satisfaction of
the City Attorney or designee the Developer's ability to fund construction.
(iv) Such other documents, as the City, in its good faith discretion,
determines will assist in the evaluation of whether the Developer is able to acquire the City
Property and the Developer Property, construct the Dolce, and perform in a timely manner all of
its other obligations and commitments set forth in this Agreement.
f. Acquisition of Developer's Property. Developer shall have acquired the
Developer's Property prior to close of escrow. A close of escrow on the Developer's Property
simultaneous with the close of escrow on the City Property shall be deemed compliance with this
provision.
g. Developer Default. Developer shall not be in default of any of its
obligations under the terms of this agreement
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19. Uefant Repurchase Conditions: City shall have the right to terminate this
Agreement upon the failure of Developer to commence construction per the benchmark schedule
above, complete the Dolce per the benchmark schedule above, open escrow no later than
November 15. 2013, or close escrow by December 31, 2013, except as may be reached by
mutual agreement between City and the Developer.
a. City shall have the right and option to repurchase the City Property and/or
purchase the Site together with all improvements thereon, if after conveyance of title to the City
Property and prior to issuance of the Certificate of Completion or Occupancy therefore, the
Developer shall:
(i) Fail to commence construction of approved improvement on the City
Property within the timeline established above. For the purposes of this provision, the Developer
shall be deemed to "commence construction' when, and only when, the Developer has received
initial approval to commence construction, which may be defined as a rough grading permit;
(ii) Fail to diligently prosecute construction of the improvements through
completion within the timeline established above;
(iii) Abandon or substantially suspend construction of the improvements
for a period of three(3) months after written notice of such abandonment;
(iv) Fail to obtain City consent and approval to, directly or indirectly,
voluntarily or involuntarily, sell, assign, transfer, dispose of or further encumber except for a
permitted transfer, equipment or "soft goods" financing, mezzanine or similar debt, or any sale
or transfer that is expressly permitted by the terns of this Agreement.
b. City shall have the right to purchase, repurchase, or transfer to another
entity, under the conditions above, and Developer shall receive the value for the property equal
to the price paid for the City Property; plus any cash payments previously paid by the Developer
for the development of the City Property for the improvements thereon, financed costs associated
with the design and entitlement, amounts financed inclusive of all "hard" and "soft" costs related
to the site and the improvements to be constructed thereon, including without limitation,
architectural, engineering and legal fees, fees paid to governmental entities, cost of all on-site
labor and materials for the construction of the improvements existing on the Parcel at the time of
repurchase less any unpaid assessments.
20. Breach by Owner. In the event that Owner shall fail to consummate this
Agreement for any reason, except Developer's default or a termination of this Agreement by
Developer or Owner pursuant to a right to do so under the provisions hereof, Developer, as its
sole and exclusive remedy may either:
a. terminate this Agreement and receive a refund of the Earnest Money, and
neither party shall have any further right or obligation hereunder other than the Surviving
Obligations, or
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b. pursue the remedy of specific performance of Owner's obligations under this
Agreement; provided, however, that
(i) Developer shall only be entitled to such remedy if
(A) any such suit for specific perfornance is filed within sixty
(60) days after Developer becomes aware of the default by Owner,
(B) Developer is not in default under this Agreement,
(C) Developer has tendered to the Title Company
(ii) the Purchase Price in immediately available funds and the Title
Company has acknowledged receipt of same, in writing, to Owner, or
(iii) evidence of available financing for the Purchase Price, in fonn and
from a financial institution or source reasonably acceptable to Owner, with funding conditioned
only upon receipt of an order from a court of competent jurisdiction granting such remedy to
Developer as a result of such suit, and the Title Company has acknowledged receipt of same, in
writing, to Owner, and
(iv) Developer has furnished ten (10) days prior written notice to Owner
of its intent and election to seek specific enforcement of this Agreement; and (v) notwithstanding
anything to the contrary contained herein, Owner shall not be obligated to expend any sums to
cure any defaults under this Agreement and if Developer seeks specific performance under this
Agreement, Developer agrees to accept the Property in its "WHERE IS, AS IS" condition.
C. Developer hereby agrees that prior to its exercise of any rights or remedies
as a result of any defaults by Owner, Developer will first deliver written notice of said default to
Owner, and if Owner so elects, Owner shall have the opportunity, but not the obligation, to cure
such default within ten (10) days after Owner's receipt of such notice. In no event whatsoever
shall Developer file any instrument of record against title to the Property; provided, however,
Developer may file a lis pendens of this Agreement simultaneously with its filing of a suit for
specific performance pursuant to this Agreement. Notwithstanding any of the foregoing to the
contrary, in no event whatsoever shall Developer have the right to seek money damages of any
kind as a result of any default by Owner under any of the terms of this Agreement except with
respect to Owner's indemnification of Developer provided in this Agreement. In no event shall
Owner be liable to Developer for any punitive, speculative or consequential damages.
21. Hotel Incentive Program: Developer shall be eligible to participate in the City's
Hotel Incentive Program (Palm Springs Municipal Code Chapter 5.26)and shall receive the 75%
rebate so long as Developer commences construction as provided in the City's Hotel Incentive
Program.
22. No Representations Or Warranties By Owner; Acceptance Of Property. Developer
acknowledges and agrees that, except as may be expressly provided in this agreement, seller has
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not made, does not make and specifically negates and disclaims any representations, warranties
(other than the special warranty of title as set out in the deed, as defined below), promises,
covenants, agreements or guaranties of any kind or character whatsoever, whether express or
implied, oral or written, past, present or future, of, as to, concerning or with respect to
a. the value, nature, quality or condition of the property, including, without
limitation, the water, soil and geology,
b. the income to be derived from the property,
C. the suitability of the property for any and all activities and uses which
purchaser or any tenant may conduct thereon,
d. the compliance of or by the property or its operation with any laws, rules,
ordinances or regulations of any applicable governmental authority or body,
e. the habitability, merchantability, marketability, profitability or fitness for a
particular purpose of the property,
f the manner or quality of the construction or materials, if any, incorporated
into the property,
g. the manner, quality, state of repair or lack of repair of the property,
h. compliance with any environmental protection, pollution or land use laws,
rules, regulations, orders or requirements, including the existence in or on the property of
hazardous materials (as defined below) or
I. any other matter with respect to the property.
Additionally, no person acting on behalf of seller is authorized to make, and by
execution hereof of purchaser acknowledges that no person has made, any representation,
agreement, statement, warranty, guaranty or promise regarding the property; and no such
representation, warranty, agreement, guaranty, statement or promise if any, made by any person
acting on behalf of seller shall be valid or binding upon seller unless expressly set forth herein.
Developer further acknowledges and agrees that having been given the opportunity to inspect the
property, purchaser is relying solely on its own investigation of the property and not on any
information provided or to be provided by seller and agrees to accept the property at the closing
and waive all objections or claims against seller (including, but not limited to, any right or claim
of contribution) arising from or related to the property or to any hazardous materials on the
property. Developer further acknowledges and agrees that any information provided or to be
provided with respect to the property was obtained from a variety of sources and that seller has
not made any independent investigation or verification of such information and makes no
representations as to the accuracy, truthfulness or completeness of such information. Owner is
not liable or bound in any manner by any verbal or written statement, representation or
information pertaining to the property, or the operation thereof, furnished by any real estate
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broker, contractor, agent, employee, servant or other person. Developer further acknowledges
and agrees that to the maximum extent permitted by law, the sale of the property as provided for
herein is made on an "as is' condition and basis with all faults. It is understood and agreed that
the purchase price has been adjusted by prior negotiation to reflect that all of the property is sold
by seller and purchased by purchaser subject to the foregoing. Except for acts or omissions prior
to closing, purchaser hereby agrees to indemnify, protect, defend, save and hold harmless seller
from and against any and all debts, duties, obligations, liabilities, suits, claims, demands, causes
of action, damages, losses, fees and expenses (including, without limitation, attorneys' fees and
expenses and court costs) in any way relating to, or in connection with or arising out of
purchaser's acquisition, ownership, leasing, use, operation, maintenance and management of the
property.
23. Development of the Site by the Developer
a. Scope of Development. The Site shall be developed as provided in the
Scope of Development (Attachment No. 3).
b. Preliminary Planned Development. The City has maintained previously
prepared and submitted schematic drawings and entitlement application (collectively a
"Preliminary Planned Development"). The Site shall be developed as generally established in the
Preliminary Planned Development and related documents except as changes may be mutually
agreed upon between the Developer and the City. Any such changes shall be within the
limitations of the Scope of Development(Attachment No. 3).
24. Construction Plans, Drawings and Related Documents. The Developer shall
prepare and submit to the City for its approval:
a. Construction plans, drawings and related documents for architectural and
site planning review and written approval. The construction plans, drawings and related
documents shall be submitted in stages: preliminary and final working drawings and plans for
each phase of work. Final working drawings and plans are hereby defined as those in sufficient
detail to obtain a foundation and/or a building permit.
b. Preliminary and final landscaping and finish grading plans for the Site. Such
final plans shall be prepared and submitted within the times agreed to between parties and
subject to extensions as are authorized herein or as mutually agreed to by the parties hereto.
C. During the preparation of all final drawings and plans, City staff and the
Developer shall hold regular progress meetings to coordinate the preparation of, submission to
and review of construction plans and related documents by the City. The City and the Developer
shall communicate and consult informally as frequently as is necessary to ensure that the formal
submittal of any documents to the City can receive prompt and speedy consideration.
25. City Approval of Plans, Drawings, and Related Documents. Subject to the terms of
this Agreement, and consistent with the provisions of the City's Municipal Code, the City shall
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have the right of architectural and site planning review of all plans and drawings, including any
changes therein.
a. The City shall approve, conditionally approve, or disapprove the plans,
drawings and related documents referred to in this Agreement. Once an aspect of the plans,
drawings and related documents has been approved by the City, a later rendering of such aspect,
or a more detailed iteration of such aspect, shall be approved by the City absent a material
change thereto.
b. Any disapproval shall state in writing with reasonable specificity the reasons
for disapproval and the changes that the City requests be made. Such reasons and such changes
must be consistent with the Scope of Development (Attachment No. 3) and any items previously
approved or deemed approved hereunder by the City. The Developer, upon receipt of a
disapproval based upon powers reserved by the City under the City's Municipal Code, shall
revise such plans, drawings and related documents and resubmit them to the City as soon as
possible after receipt of the notice of disapproval, provided that in no case shall the City be
entitled to require changes inconsistent with the Scope of Development and any previously
approved items.
C. If the Developer desires to make any substantial change in the construction
plans after their approval by the City, the Developer shall submit the proposed change to the City
for its approval. If the construction plans, as modified by the proposed change, conform to the
requirements of this Agreement, the approvals previously granted by the City under this Scope of
Development (Attachment No. 3), the City shall approve the proposed change and notify the
Developer in writing within ten (10) days after submission to the City by written notice thereof
by the City to the Developer setting forth in detail the reasons therefor.
26. Cost of Construction. The cost of developing the Site and constructing all
improvements thereon shall be borne by the Developer, except for work expressly set forth in
this Agreement to be performed or paid for by the City or others. The City and the Developer
shall each pay the costs necessary to administer and carry out their respective responsibilities and
obligations under this Agreement.
27. Construction Schedule. After close of escrow, the Developer shall promptly begin
and thereafter diligently prosecute to completion the construction of the improvements and the
development of the Site. The Developer shall begin and complete all construction and
development within the times specified in this Agreement or such reasonable extension of said
dates as may be granted by the City. During the period of construction, but not more frequently
than once a month, the Developer shall submit to the City a written progress report of the
construction when and as requested by the City. The report shall be in such form and detail as
may reasonably be required by the City and shall include a reasonable number of construction
photographs taken since the last report submitted by the Developer.
28. Bodily Injury, Property Damage and Workers' Compensation Insurance. Prior to
the commencement of construction on the Site or any portion thereof, the Developer shall furnish
or cause to be furnished to the City duplicate originals or appropriate certificates of bodily injury
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and property damage insurance policies in the amount of at least ONE MILLION DOLLARS
(SI,000,000) for any person, FIVE MILLION DOLLARS (S5,000,000) for any occurrence and
FIVE HUNDRED THOUSAND DOLLARS (S500,000) property damage, naming the City as an
additional or coinsured. The Developer shall also furnish or cause to be furnished to the City
evidence satisfactory to the City that any contractor with whom it has contracted for the
perfonnance of work on the Site carries workers' compensation insurance as required by law.
The obligations set forth in this Section shall remain in effect only until a final Certificate of
Completion has been issued covering the hotel construction,
29. City and Other Governmental Agency Permits. Before commencement of
construction or development of any buildings, structures or other work of improvement upon the
Site (unless such construction, development or work is to be commenced before the conveyance
of title), the Developer shall, at its own expense, secure or cause to be secured any and all
permits that may be required by the City or any other governmental agency affected by such
construction, development or work. If any revisions or corrections of plans approved by the City
shall be required by any government official, agency, department or bureau having jurisdiction,
or any lending institution involved in financing, the Developer and the City shall cooperate in
efforts to obtain a waiver of such requirements or to develop a mutually acceptable alternative.
30. Rights of Access, For the purposes of assuring compliance with this Agreement,
representatives of the City shall have the reasonable right of access to the Site without charges or
fees and at normal construction hours during the period of construction for the purposes of this
Agreement, including, but not limited to, the inspection of the work being performed in
constructing the improvements. Such representatives of the City shall be those who are so
identified in writing by the City Manager. The City shall indemnify and defend the Developer
and hold it harmless from any damage caused or liability arising out of this right to access.
31. Local, State, and Federal Laws. The Developer shall carry out the construction of
the improvements in conformity with all applicable laws, including all applicable federal and
state labor standards.
32. Antidiscrimination Daring Construction. The Developer, for itself and its
successors and assigns, agrees that in the construction of the improvements provided for in this
Agreement, the Developer will not discriminate against any employee or applicant for
employment because of race, color, creed, religion, sex, marital status, sexual orientation,
ancestry or national origin.
33. Responsibilities of the City. The City, without expense to the Developer or
assessment or claim against the Site, shall perform all work specified for the City to perform
within the times specified in the construction schedule.
34. Taxes, Assessments, Encumbrances and Liens. The Developer shall pay when due
all real estate taxes and assessments assessed and levied on the Site for any period subsequent to
conveyance of title to or delivery to Developer. Prior to the issuance of a Certificate of
Completion for the Hotel the Developer shall not place or allow to be placed on the City
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i
Property any mortgage, trust deed, encumbrance or lien unauthorized by this Agreement. The
Developer shall remove or have removed any levy or attachment made on the City Property (or
any portion thereof), or shall assure the satisfaction thereof, within a reasonable time, but in any
event prior to a sale thereunder. Nothing herein contained shall be deemed to prohibit the
Developer from contesting the validity or amounts of any tax, assessment, encumbrance or lien,
nor to limit the remedies available to the Developer in respect thereto.
35. Prohibition Against Transfer of City Property, the Buildings or Structures Thereon
and Assignment or Agreement. After close of escrow of and prior to the issuance by the City of
a Certificate of Completion with respect to the improvements pursuant to Scope of Development
(Attachment 3), with the exception of the sale of individual villas and fractional units, the
Developer shall not, except as expressly permitted by this Agreement, sell, transfer, convey,
assign or lease the whole or any part of the buildings or improvements thereon without the prior
written approval of the City. This prohibition shall not apply subsequent to the issuance of the
Certificate of Completion for the Hotel improvements. This prohibition shall not be deemed to
prevent the granting of easements or permits to facilitate the development of the City Property or
to prohibit or restrict the leasing of any part or parts of a building or structure when said
improvements are completed.
a. In the absence of specific written agreement by the City, no such transfer,
assignment or approval by the City shall be deemed to relieve the Developer or any other party
from any obligations under this Agreement until completion of development of the Hotel as
evidenced by the issuance of a Certificate of Completion therefor.
b. Changes may be mutually agreed upon between the Developer and the City.
Any such changes shall be within the limitations of the Scope of Development (Attachment No.
3).
36. Security Financing; Rights of Holders. No Encumbrances except Mortgages,
Deeds of Trust, Sales and Lease-Backs or Other Financing for Development. Notwithstanding
Sections and of this Agreement, mortgages, deeds of trust, sales and lease-backs or any
other form of conveyance required for any reasonable method of financing are permitted before
issuance of a Certificate of Completion for the Hotel, but only for the purpose of securing loans
of funds to be used for financing the acquisition or development of the Site, the construction of
Hotel improvements, and any other expenditures necessary and appropriate to develop the City
Property under this Agreement. The Developer shall notify the City in advance of any mortgage,
deed of trust, sale and lease-back or other form of conveyance for financing if the Developer
proposes to enter into the same before issuance of a Certificate of Completion for the Hotel. The
Developer shall not enter into any such conveyance for financing without the prior written
approval of the City (unless such lender shall be one of the ten (10) largest banking institutions
doing business in the State of California, or one of the ten (10) largest insurance lending
institutions in the United States qualified to do business in the State of California), which
approval the City agrees to give if any such conveyance is given to a responsible financial or
lending institution or other acceptable person or entity. Such lender shall be deemed approved
unless rejected in writing by the City within ten (10) days after notice thereof to the City by the
Developer. In any event, the Developer shall promptly notify the City of any mortgage, deed of
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trust, sale and lease-back or other financing conveyance, encumbrance or lien that has been
created or attached thereto prior to completion of the construction of the improvements on the
Site whether by voluntary act of the Developer or otherwise. The words "mortgage" and "deed of
trust," as used herein, include all other appropriate modes of financing real estate acquisition,
construction and land development.
37. Holder Not Obligated to Construct Improvements. The holder of any mortgage,
deed of trust or other security interest authorized by this Agreement shall in no way be obligated
by the provisions of this Agreement to construct or complete the improvements or to guarantee
such construction or completion. Nothing in this Agreement shall be deemed to construe, permit
or authorize any such holder to devote the City Property to any uses or to construct any
improvements thereon other than those uses or improvements provided for or authorized by this
Agreement.
38. Notice of Default to Mortgage, Deed of Trust or Other Seeurity Interest Holders;
Right to Cure. Whenever the City shall deliver any notice or demand to the Developer with
respect to any breach or default by the Developer in completion of construction of the
improvements, the City shall at the same time deliver a copy of such notice or demand to each
holder of record of any mortgage, deed of trust or other security interest authorized by this
Agreement who has previously made a written request to the City therefor. Each such holder
shall (insofar as the rights of the City are concerned) have the right, at its option, within ninety
(90) days after the receipt of the notice, to cure or remedy or commence to cure or remedy any
such default and to add the cost thereof to the security interest debt and the lien on its security
interest. In the event there is more than one such holder, the right to cure or remedy a breach or
default of the Developer under this Section shall be exercised by the holder first in priority or as
the holders may otherwise agree among themselves, but there shall be only one exercise of such
right to cure and remedy a breach or default of the Developer under this Section. Nothing
contained in this Agreement shall be deemed to permit or authorize such holder to undertake or
continue the construction or completion of the improvements (beyond the extent necessary to
conserve or protect the improvements or construction already made) without first having
expressly assumed the Developer's obligations to the City by written agreement satisfactory to
the City. The holder in that event must agree to complete, in the manner provided in this
Agreement, the improvements to which the lien or title of such holder relates and submit
evidence satisfactory to the City that it has the qualifications and financial responsibility
necessary to perform such obligations. Any such holder properly completing such improvements
shall be entitled, upon written request made to the City, to a Certificate of Completion from the
City.
39. Failure of Holder to Complete Improvements. In any case where, six (6) months
after default by the Developer in completion of construction of improvements under this
Agreement, the holder of any mortgage, deed of trust or other security interest creating a lien or
encumbrance upon the Site or any portion thereof has not exercised the option to construct, or if
it has exercised the option and has not proceeded diligently with construction, the City may
purchase the mortgage, deed of trust or other security interest by payment to the holder of the
amount of the unpaid debt, plus any accrued and unpaid interest and all other amounts due under
the loan secured thereby including, without limitation, any prepayment obligation. If ownership
88
17
914973.1
has vested in the holder, the City, if it so desires, shall be entitled to a conveyance from the
holder to the City upon payment to the holder of an amount equal to the sum of the following:
a. The unpaid mortgage, deed of trust or other security interest debt at the time
title became vested in the holder (less all appropriate credits, including those resulting from
collection and application of rentals and other income received during foreclosure proceedings);
b. All expenses with respect to foreclosure;
C. The net expenses, if any (exclusive of general overhead), incurred by the
holder as a direct result of the subsequent management of the Site or portions thereof;
d. The costs of any authorized improvements made by such holder; and
e. An amount equivalent to the interest that would have accrued on the
aggregate of such amounts had all such amounts become part of the mortgage or deed of trust
debt and such debt had continued in existence to the date of payment by the City
40. Right of City to Cure Mortgage, Deed of Trust or Other Security Interest Default.
In the event of a default or breach by the Developer of a mortgage, deed of trust or other security
interest with respect to the Site or any portion thereof prior to the completion of development,
and the holder has not exercised its option to complete the development, the City may cure the
default prior to completion of any foreclosure. In such event, the City shall be entitled to
reimbursement from the Developer of all costs and expenses incurred by the City in curing the
default. The City shall also be entitled to a lien upon the Site or applicable portion thereof to the
extent of such costs and disbursements. Any such lien shall be subject to mortgages, deeds of
trust or other security interests executed for the sole purpose of obtaining funds to purchase and
develop the Hotel Property as authorized herein.
41. Right of the City to Satisfy Other Liens on the Site After Title Passes. After the
close of escrow and prior to the issuance of a Certificate of Completion for construction and
development on the Hotel Property, and after the Developer has had a reasonable time to
challenge, cure or satisfy any liens or encumbrances on the Site, the City shall have the right to
satisfy any such liens or encumbrances, provided, however, that nothing in this Agreement shall
require the Developer to pay or make provision for the payment of any tax, assessment, lien or
charge so long as the Developer in good faith shall contest the validity or amount thereof, and so
long as such delay in payment shall not subject the Site to forfeiture or sale.
42. Certificate of Completion. Promptly after completion and satisfactory inspection by
the City of all construction and development to be completed by the Developer upon the Hotel
Property the City shall furnish the Developer with a Certificate of Completion upon written
request therefor by the Developer. Such Certificate of Completion shall be in such form as to
permit it to be recorded in the Office of the County Recorder of Riverside County.
a. A Certificate of Completion shall be, and shall so state, conclusive
determination of satisfactory completion of the construction required by this Agreement upon the
89
914973.1
Hotel Property and of full compliance with the terms hereof_ After issuance of such Certificate
of Completion, any party then owning or thereafter purchasing, leasing or otherwise acquiring
any interest in the Hotel Property covered by said Certificate of Completion shall not (because of
such ownership, purchase, lease or acquisition) incur any obligation or liability under this
Agreement. Except as otherwise provided herein, after the issuance of a Certificate of
Completion for the Hotel, neither the City nor any other person shall have any rights, remedies or
controls with respect to the Hotel Property that it would otherwise have or be entitled to exercise
under this Agreement as a result of a default in or breach of any provision of this Agreement, and
the respective rights and obligations of the parties shall be as set forth in the grant deed of the
Hotel Property.
b. The City shall not unreasonably withhold a Certificate of Completion. If the
City refuses or fails to furnish a Certificate of Completion for the Hotel after written request
from the Developer, the City shall, within ten (10) days after receipt of such written request,
provide the Developer with a written statement of the reasons the City refused or failed to furnish
a Certificate of Completion. The statement shall also contain the City's opinion of the action the
Developer must take to obtain a Certificate of Completion. If the reason for such refusal is
confined to the immediate unavailability of specific items or materials for landscaping, the City
will issue its Certificate of Completion upon the posting of a bond by the Developer with the
City in an amount representing a fair value of the work not yet completed. If the City shall have
failed to provide such written statement within said ten (10) day period, the Developer shall be
deemed entitled to the Certificate of Completion.
C. Such Certificate of Completion shall not constitute evidence of compliance
with or satisfaction of any obligation of the Developer to any holder of a mortgage or any insurer
of a mortgage securing money loaned to finance the improvements or any part thereof. Such
Certificate of Completion is not notice of completion as referred to in California Civil Code
Section 3093 or a Certificate of Occupancy.
43. Uses of the Site. The Developer covenants and agrees for itself, its successors, its
assigns and every successor in interest that the Developer and its successors and assignees shall
use, operate and maintain the Site and the improvements thereon only for a First Class Hotel,
equivalent to a 4+ star category, as described in this Agreement. The Developer shall use the
Site and the improvements thereon for no purpose other than hotel and hotel related uses without
the prior written consent of the City. The foregoing covenant shall run with the land.
44_ Hotel Operator. The Developer shall cause the Hotel to be operated pursuant to an
operating and/or management agreement ("Hotel Operating Agreement") with a Dolce Hotels
and Resorts, qualified operator ("Operator"). The Hotel Operating Agreement shall provide for
no less than a one hundred fifty (150) room block commitment (needs to be changed to an
appropriate block number based on the final mix) to the Convention Center under the
Convention Center's Committable Rooms Program. Prior to conveyance of the Site to the
Developer, the Developer shall provide to the City written confirmation that it has entered into
the Hotel Operating Agreement with the Operator together with an abstract of Hotel Operating
Agreement which identifies the material tenns and provisions contained therein.
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914973.1
Any change in the identity of the Operator prior to issuance of a Certificate of
Completion shall require the prior written approval of the City, which approval shall not be
unreasonably withheld or delayed if the new Operator is as qualified as Dolce Hotels and
Resorts. As used herein 'change in the identity of Operator" shall mean any change in fifty
percent (50%) or more of the ownership or control of the Operator or in a general partner,
managing partner or other entity having a controlling interest in Operator.
45. Obligation to Rq rain From Discrimination. The Developer covenants by and for
itself and any successors in interest that there shall be no discrimination against or segregation of
any person or group of persons on any basis listed in subdivision (a) or (d) of Section 12955 of
the Government Code, as those bases are defined in Section 12926, 12926.1, subdivision (m) and
paragraph (1) of subdivision (p) of Section 12955, and Section 12955.2 of the Government Code
in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the Site, nor shall the
Developer itself or any person claiming under or through it establish or permit any such practice
or practices of discrimination or segregation with reference to the selection, location, number,
use or occupancy of tenants, lessees, subtenants, sublessees or vendees of the Site. The foregoing
covenants shall run with the land.
a. Form of Nondiscrimination and Nonsegregation Clauses:
The Developer shall refrain from restricting the rental, sale or lease of the
Site on any basis listed in subdivision (a) or (d) of Section 12955 of the Government Code, as
those bases are defined in Section 12926, 12926.1, subdivision (m) and paragraph (1) of
subdivision (p) of Section 12955, and Section 12955.2 of the Government Code. All such deeds,
leases or contracts shall contain or be subject to substantially the following nondiscrimination or
nonsegregation clauses:
(i) In deeds: "The grantee herein covenants by and for himself or
herself, his or her heirs, executors, administrators and assigns, and all persons claiming under or
through them, that there shall be no discrimination against or segregation of any person or group
of persons on any basis listed in subdivision (a) or (d) of Section 12955 of the Government Code,
as those bases are defined in Section 12926, 12926.1, subdivision (m) and paragraph (1) of
subdivision (p) of Section 12955, and Section 12955.2 of the Government Code in the sale,
lease, sublease, transfer, use, occupancy, tenure or enjoyment of the premises herein conveyed,
nor shall the grantee, or any person claiming under or through him or her, establish or permit any
such practice or practices of discrimination or segregation with reference to the selection,
location, number, use or occupancy of tenants, lessees, subtenants, sublessees or vendees in the
premises herein conveyed. The foregoing covenants shall run with the land."
(ii) In leases: "The lessee herein covenants by and for himself or herself,
his or her heirs, executors, administrators and assigns, and all persons claiming under or through
him or her, and this lease is made and accepted upon and subject to the following conditions:
(iii) That there shall be no discrimination against or segregation of any
person or group of persons on any basis listed in subdivision (a) or (d) of Section 12955 of the
Government Code, as those bases are defined in Section 12926, 12926.1, subdivision (m) and
91
20
914973.1
paragraph (1) of subdivision (p) of Section 12955, and Section 12955.2 of the Government Code,
in the leasing, subleasing, transferring, use, occupancy, tenure or enjoyment of the premises
herein leased, nor shall the lessee himself or herself, or any person claiming under or through
him or her, establish or permit any such practice or practices of discrimination or segregation
with reference to the selection, location, number, use or occupancy of tenants, lessees,
subtenants, sublessees or vendees in the premises herein leased."
(iv) In contracts: "There shall be no discrimination against or
segregation of any person or group of persons on any basis listed in subdivision (a) or (d) of
Section 12955 of the Government Code, as those bases are defined in Section 12926, 12926.1,
subdivision (m) and paragraph (1) of subdivision (p) of Section 12955, and Section 12955.2 of
the Government Code in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment
of the premises, nor shall the transferee himself or herself, or any person claiming under or
through him or her, establish or permit any such practice or practices of discrimination or
segregation with reference to the selection, location, number, use or occupancy of tenants,
lessees, subtenants, sublessees or vendees of the premises."
b. Effect and Duration of Covenants. The covenants against discrimination
shall remain in effect in perpetuity. The covenants established in this Agreement and the grant
deed shall, without regard to technical classification and designation, be binding for the benefit
and in favor of the City, its successors and assigns, the City and any successor in interest to the
Site or any part thereof.
C. The City is deemed the beneficiary of the terms and provisions of this
Agreement and of the covenants running with the land for and in its own rights and for the
purposes of protecting the interests of the community and other parties, public or private, in
whose favor and for whose benefit this Agreement and the covenants running with the land have
been provided. This Agreement and the covenants shall run in favor of the City without regard to
whether the City has been, remains or is an owner of any land or interest therein in the Site, any
parcel or subparcel, or in the Site. The City shall have the right, if this Agreement or the
covenants are breached, to exercise all rights and remedies and to maintain any actions or suits at
law or in equity or other proper proceedings to enforce the curing of such breaches to which it or
any other beneficiaries of this Agreement and the covenants may be entitled.
46. Defaults, Remedies and Termination
a. Subject to the extensions of time set forth herein, failure or delay by either
party to perform any term or provision of this Agreement constitutes a default under this
Agreement. The party who so fails or delays must immediately commence to cure, correct or
remedy such failure or delay and shall complete such cure, correction or remedy with reasonable
diligence and during any period of curing shall not be in default.
b. The injured party shall give written notice of default to the party in default
specifying the default complained of by the injured party. Except as required to protect against
further damages, the injured party may not institute proceedings against the party in default until
92
21
914973.1
thirty (30) days after giving such notice. Failure or delay in giving such notice shall not
constitute a waiver of any default nor shall it change the time of default.
C. Except as otherwise expressly provided in this Agreement, any failure or
delay by either party in asserting any of its rights or remedies as to any default shall not operate
as a waiver of any default or of any such rights or remedies or deprive such party of its right to
institute and maintain any actions or proceedings that it may deem necessary to protect, assert or
enforce any such rights or remedies.
47. Miscellaneous
a. Notices. All notices, demands and requests which may be given or which
are required to be given by either party to the other, and any exercise of a right of termination
provided by this Agreement, shall be in writing and shall be deemed effective either:
(i) on the date personally delivered to the address identified in Sections
1 and 2 above, as evidenced by written receipt therefor, whether or not actually received by the
person to whom addressed;
(ii) on the day sent, by certified or registered mail, return receipt
requested, addressed to the intended recipient at the address specified in Sections l and 2 above;
(iii) on the first (1st) business day after being deposited into the custody
of a nationally recognized overnight delivery service such as Federal Express, addressed to such
party at the address specified in Sections 1 and 2 above, or
(iv) on the date delivered by facsimile to the respective numbers
specified Sections 1 and 2 above.
b. Entire Agreement. This Agreement embodies the entire agreement between
the parties relative to the subject matter hereof, and there are no oral or written agreements
between the parties, nor any representations made by either party relative to the subject matter
hereof, which are not expressly set forth herein.
C. Amendment. This Agreement may be amended only by a written
instrument executed by the party or parties to be bound thereby.
d. Headings. The captions and headings used in this Agreement are for
convenience only and do not in any way limit, amplify, or otherwise modify the provisions of
this Agreement.
C. Time of Essence. Time is of the essence of this Agreement; however, if the
final date of any period which is set out in any provision of this Agreement falls on a Saturday,
Sunday or legal holiday under the laws of the United States or the State of California , then, in
such event, the time of such period shall be extended to the next day which is not a Saturday,
Sunday or legal holiday.
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9149711
f. Governing Law. This Agreement shall be governed by the laws of the State
of California and the laws of the United States pertaining to transactions in such State.
g. Invalid Provision. If any provision of this Agreement is held to be illegal,
invalid or unenforceable under present or future laws, such provision shall be fully severable;
this Agreement shall be construed and enforced as if such illegal, invalid or unenforceable
provision had never comprised a part of this Agreement; and, the remaining provisions of this
Agreement shall remain in full force and effect and shall not be affected by such illegal, invalid,
or unenforceable provision or by its severance from this Agreement.
h. Attorneys' Fees. In the event it becomes necessary for either party hereto to
file suit to enforce this Agreement or any provision contained herein, the party prevailing in such
suit shall be entitled to recover, in addition to all other remedies or damages, as provided herein,
attorneys' fees and expenses incurred in such suit.
i. Multiple Counterparts. This Agreement may be executed in a number of
identical counterparts which, taken together, shall constitute collectively one (1) agreement; in
making proof of this Agreement, it shall not be necessary to produce or account for more than
one such counterpart with each party's signature.
j. Effective Date. As used herein the term "Effective Date" shall mean the
date of approval by the City Council.
k. Sales Date: As used herein the term "Sales Date" shall mean the date the
Title Company is in receipt of both this Agreement executed by Developer and Owner (whether
in counterparts or not) and the Earnest Money, as indicated by the dating of the Title Company's
signature in the blank provided for same.
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9149131
1. Merger Provision. Except as otherwise expressly provided herein, any and
all rights of action of Developer for any breach by Owner of any representation, warranty or
covenant contained in this Agreement shall merge with the Deed and other instruments executed
at Closing, shall terminate at Closing and shall not survive Closing.
DEVELOPER: CDI Ventures, LLC By: L!�G
Date of Execution by Developer: Name: I//!)1111;gM
Title:
OWNER: City of Palm Springs By:
Date of Execution by Owner: Name: �OI\VA �A c t
Title: v:s r
AP R 0 AS TO FORfMf
Qty Ammey
� 03• � . tT3 0 ,_
APPROVED BY CITY COUNCIL
ATTEST: �•b la �L P�I93Z�I --
ity Clerk
ACKNOWLEDGMENT
was tiff }W1
State of Gel�i€ertria )
ss
County of Yl )
95
24
914973.1
On I" w W 14120 (3 before me, 0004 MM ,Notary Public,
personally appeared V/1I I14(YVl 4-f QV*j1:3?vD' 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.
h�Sv►i {rQy�
I certify under PENALTY OF PERJURY under the laws of the State of Califamix that the
foregoing paragraph is true and correct.
WITNESS my hand an rcial seal.
Notary Pub k
Stab of Washington
ABBY MALDONADO
(Seal) My Appuintmnt Expires Dec 10,2015
ACKNOWLEDGMENT
State of California )
) ss
County of )
On before me, 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.
(Seal)
96
25
914973.1
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ATTACHMENT NO.2
LEGAL DESCRIPTION OF THE SITE
Aeency Parcel
All that certain real property located in the City of Palm Springs, County of Riverside,
State of California,more particularly described as follows:
BLOCKS 103, 105 AND 106 IN SECTION 14, TOWNSHIP 4 SOUTH, RANGE 4
EAST, SAN BERNARDINO MERIDIAN, IN THE CITY OF PALM SPRINGS,
COUNTY OF RNERSIDE, STATE OF CALIFORNIA, ACCORDING TO THE
OFFICAL PLAT THEREOF.
Developer Parcel:
BLOCK 102 IN SECTION 14, TOWNSHIP 4 SOUTH, RANGE 4 EAST, SAN
BERNARDINO MERIDIAN, IN THE CITY OF PALM SPRINGS, COUNTY OF
RIVERSIDE, STATE OF CALIFORNIA, ACCORDING TO THE OFFICAL PLAT
THEREOF.
98
ATTACHMENT NO. 3
SCOPE OF DEVELOPMENT
1. PRIVATE DEVELOPMENT
A, General
The Developer aggress that the Site shall be developed and improved in
accordance with the provisions of this Agreement and the plans, drawings and related
documents approved by the City. The Developer and its supervising architect, engineer
and contractor shall work with the City staff to coordinate the overall design,
architecture and color of the improvements of the Site.
B, Developer's Improvements
The Developer shall construct, or cause to be constructed, on the Site a "four star"
Dolce Hotel of at least two hundred (200) rooms, no more than 150 additional residential
units which may be fractionals, private residences, for rent residences, or condominiums
and on-site parking which meets the requirements of the City. A"four star" hotel means
a full service hotel comparable to other Dolce Hotels in operation as of of the date of this
Agreement. The hotel will contain at least then thousand (10,000) square feet of"under
roof'group meeting space.
C. Architecture and Design
The Developer's improvements shall be of high architectural quality, shall be well
landscaped and shall be effectively and aesthetically designed. The Developer's plans
submitted to the Agency shall describe in details the architectural character intended for
the Developer's improvements.
D. Landscaping
Landscaping shall embellish all open spaces upon the Site to integrate the
Developer's improvements with adjacent sites. Landscaping includes such materials as
paving,tress, shrubs and other plant materials, landscape containers, plaza furniture, top
soil preparation,automatic irrigation and landscape and pedestrian lighting.
Landscaping shall carry out the objectives and principles of the City's desire to
accomplish a high quality aesthetic environment.
E. Signs
All signs on the exterior of the buildings are of special concern to the City and
must be approved by the City (which approval shall not be unreasonably withheld).
F. Screening
99
Trash areas shall be screened on at least three (3) sides and have movable doors
or other devices to obscure such areas from view. All fire standpipes and such other fire
related mechanical devises shall be screened. Rooftop equipment shall be reasonably
hidden so as to mitigate views from principal elevations surrounding the development.
G. Applicable Codes
The Developer's Improvements shall be constructed in accordance with the
Uniform Building Code (with City modification) and the Municipal Code.
IL SITE CLEARANCE AND PREPARATION
The Developer shall perform, or cause to be performed, at its sole cost and expense, the
following work:
A. On-site Demolition and Clearance
1. On the Site, demolish or salvage, clear, grub, and remove (as may be needed
and called for in the approved plan) all on-site buildings, pavements,walks,
curbs, gutters and other improvements: and
2. Remove, plug and/or crush in place utilities, such as storm sewers, sanitary
sewers, water systems, electrical overhead and underground systems and
telephone and gas systems located on the Site, as may be required following
any necessary relocation of the utilities.
B. Compaction, Finish Grading and Site Work
The Developer shall compact, finish grade and do such site preparation as is
necessary for the construction of the Developer's Improvements on the Site.
III. PUBLIC IMPROVEMENTS
The City shall perform, or cause to be performed the following work in connection with
the development of the Site by the Developer. (None)
100
AMENDMENT NO. 1 TO
PURCHASE AND SALE AGREEMENT
(DOLCE)
THIS AMENDMENT NO. 1 TO PURCHASE AND SALE AGREEMENT
("Amendment") is made and entered into this 5th day of March, 2014, by and between
the City of Palm Springs, a California charter city ("City") and CDI VENTURES, LLC, a
California limited liability company (the "Developer").
RECITALS
A. City and Developer entered into a Purchase and Sale Agreement on
March 6, 2013 for the purpose of developing and maintaining a Dolce Hotel Project on
property owned by the City.
B. Delays in certain performance obligations have occurred as a result of
changes in state law and outside of the control of the Parties. This Amendment will
modify the affected performance schedule in response to such delays. In addition, the
Developer has reorganized as a new legal entity and the Parties agree that the new
entity should be designated as the Developer under the terms of the Purchase and Sale
Agreement with all of the rights and responsibilities of the Developer under the terms of
the Purchase and Sale Agreement.
C. The Parties also acknowledge that the City requires additional time to
construct replacement parking to serve the City's Convention Center and that demolition
and construction activities on the City Property should not commence until September
1, 2014 at the earliest.
NOW, THEREFORE, in consideration of the foregoing Recitals and the promises
and covenants contained herein below, City and Developer agree as follows:
AGREEMENT
Section 1. The foregoing Recitals are true and correct.
Section 2. The City and Developer agree that Praetor Investments, LLC, a California
limited liability company, is hereby acknowledged, designated, and identified as the
successor, transferee, conveyee, and/or assignee of all rights, responsibilities, and
obligations of Developer under the terms of the Purchase and Sale Agreement.
Developer represents that Praetor Investments, LLC possesses the qualifications and
financial responsibility necessary and adequate, consistent with the provisions of the
Purchase and Sale Agreement to fulfill the obligations of Developer under the Purchase
and Sale Agreement.
Section 3. Section 7 of the Purchase and Sale Agreement is amended to read:
Page 1 of 3 101
678705.2
7. Purchase Date: Property shall be purchased on the start of construction by
Developer but no later than October 15, 2014. Escrow shall be opened no less than
thirty (30) days before the anticipated Purchase Date.
Section 4. The reference to "Section 8" in the second line of the text in Section 8 of
the Purchase and Sale Agreement is amended to read "Section 7."
Section 5. Section 16 of the Purchase and Sale Agreement is amended to read:
16. Benchmark Schedule:
Building Permits: All construction plans and specifications for the Dolce shall be
complete and Building Permits necessary for the construction of foundations and the
building shell, including without limitation walls and roofs, shall be applied for and
obtained prior to commencement of demolition of any portion of the City Property.
Demolition and Commencement of Construction: No Sooner than September 1,
2014, and No Later than October 15, 2014.
Section 6. Except as expressly provided above, all other terms and conditions of the
Purchase and Sale Agreement shall remain unchanged and in full force and effect.
CITY OF PALM SPRINGS
Date: a3 r 8f LO I 1 Bye s
David Ready, C' ager
AP?RUV1u
DEVELOPER
l , / CDI Ventures, LLC
Date: ~�� /�7 By: J
L uri Kibby, Ma g ng ember
Praetor Investments, LLC
By: CDI Ventures, LLC, General Partner
Date: `3 '� By.
Lauri Kibby, M
\a !ng Member
_J
Page 2of3 102
678705.2
APPROV D TO FORM: ATTEST:
By:
Do s Holland ?Jam—esThompson
Ci Attorney City Clerk
Page 3 of 3 103
678705.2
AMENDMENT NO. 2 TO PURCHASE AND SALE AGREEMENT(DOLCE)
THIS AMENDMENT NO. 2 TO PURCHASE AND SALE AGREEMENT ("Amendment")
is made and entered into this 1-orr day of October, 2014, by and between the City of Palm
Springs, a California charter city("City")and Praetor Investments, LLC, a California limited liability
company(the "Developer").
RECITALS
A. City and Developer entered into a Purchase and Sale Agreement on March 6,
2013 for the purpose of developing and maintaining a Dolce Hotel Project on property owned by
the City.
B. Delays in certain performance obligations have occurred as a result of changes in
state law and outside of the control of the Parties. This Amendment will modify the affected
performance schedule in response to such delays. In addition, the Developer has reorganized as
a new legal entity using the project name and the Parties agree that the new entity should be
designated as the Developer under the terms of the Purchase and Sale Agreement with all of the
rights and responsibilities of the Developer under the terms of the Purchase and Sale
Agreement.
C. The Parties also acknowledge that the City requires additional time to construct
replacement parking to serve the City's Convention Center and that demolition and construction
activities on the City Property should not commence until March 1, 2015 at the earliest.
NOW, THEREFORE, in consideration of the foregoing Recitals and the promises and
covenants contained herein below, City and Developer agree as follows:
AGREEMENT
Section 1. The foregoing Recitals are true and correct.
Section 2. The City and Developer agree that Selene Palm Springs, LLC, a California limited
liability company, is hereby acknowledged, designated, and identified as the successor,
transferee, conveyee, and/or assignee of all rights, responsibilities, and obligations of Developer
under the terms of the Purchase and Sale Agreement. Developer represents that Selene Palm
Springs, LLC possesses the qualifications and financial responsibility necessary and adequate,
consistent with the provisions of the Purchase and Sale Agreement to full the obligations of
Developer under the Purchase and Sale Agreement.
Section 3. Section 7 of the Purchase and Sale Agreement is amended to read:
Page 1 ?, 4
7. Purchase Date: Property shall be purchased prior to the start of construction by
Developer but no later than April 15, 2015. Escrow shall be opened no less than thirty(30) days
before the anticipated Purchase Date.
Section 4. Section 16 of the Purchase and Sale Agreement is amended to read:
16. Benchmark Schedule:
Building Permits: All construction plans and specifications for the Dolce shall be complete
and Building Permits necessary for the construction of foundations and the building shell,
including without limitation walls and roofs, shall be applied for and obtained prior to
commencement of demolition of any portion of the City Property.
Demolition and Commencement of Construction: No Sooner than March 1, 2015, and
No Later than April 15, 2015.
Section 5. Except as expressly provided above, all other terms and conditions of the Purchase
and Sale Agreement, as amended, shall remain unchanged and in full force and effect.
llll
[SIGNATURES ON THE FOLLOWING PAGE]
105
Page 2
IN WITNESS WHEREOF, the Parties have executed this Agreement as of the
dates stated below.
"CITY"
City of Palm Springs
Date: 101ZsfZ04 By�—
vid H. Ready,
City Manager n,^
APPROVES BY C�!"If C(?l.�.�l!
101011104 Zc7
APPROVED O FORM: ATTEST: 329
By: By:
Dougla olland, era rwG
City Attorney _-D LF VTfCity Clerk
"DEVELOPER"
PRAETOR INVESTMENTS, LLC
Date: 101 z z3
Uri Kibby
Managing Member
ACCEPTED BY:
SELENE PALM SPRINGS, LLC
Date: 1
Lauri Kibby
Managing Member
106
Page 3
State of California )
)SS.
County of Riverside )
On /-7e gt/? F,2olq before me, DarlaC ZAMn-ll' �v q Pub lrz
Date Name and Title of fficer
Personally appeared
L 66 v
N e(s)of Signeris)
who proved to me on the basis of satisfactory evidence to be the person(s)-
whose name(s) is/,1M subscribed to the within instrument and acknowledged to
me that tie/she/they executed the same in his/her/their authorized capacity(ies),
and that by his/her,their signature(s) on the instrument the persons) or the entity
upon behalf of which the persons) 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 of Notary Public
DARIA G. LUCARELLI
Commission M 2003496
.�� Notary Public-California i
z ' Riverside County s
My Comm.Expires Jan 10.2017'
Page 4 107
AMENDMENT NO. 3 TO PURCHASE AND SALE AGREEMENT(SELENE)
THIS AMENDMENT NO. 3 Sq PURCHASE AND SALE AGREEMENT ("Amendment')
is made and entered into this P day of April, 2015, by and between the City of Palm
Springs, a California charter city ("City") and Selene Palm Springs, LLC, a California limited
liability company, the successor to Praetor Investments, LLC(the"Developer").
RECITALS
A. City and Developer entered into a Purchase and Sale Agreement on March 6,
2013 for the purpose of developing and maintaining a Dolce Hotel Project on property owned by
the City.
B. Delays in certain performance obligations have occurred as a result of changes in
state law and outside of the control of the Parties. This Amendment will modify the affected
performance schedule in response to such delays. In addition, in 2014 the Developer
reorganized as a new legal entity using the project name and the Parties agreed that the new
entity should be designated as the Developer under the terms of the Purchase and Sale
Agreement with all of the rights and responsibilities of the Developer under the terms of the
Purchase and Sale Agreement.
C. The Parties also acknowledge that the City requires additional time to construct
replacement parking to serve the City's Convention Center and that the Developer shall give
sufficient notice to City prior to demolition and construction activities on the City Property
commencing. .
NOW, THEREFORE, in consideration of the foregoing Recitals and the promises and
covenants contained herein below, City and Developer agree as follows:
AGREEMENT
Section 1. The foregoing Recitals are true and correct.
Section 2. Section 7 of the Purchase and Sale Agreement is amended to read:
7. Purchase Date: Property shall be purchased prior to the start of construction by
Developer but no later than January 15, 2016. Escrow shall be opened no less than thirty (30)
days before the anticipated Purchase Date.
Section 4. Section 16 of the Purchase and Sale Agreement is amended to read:
16. Benchmark Schedule:
Financing. Developer secured the debt Letter of Commitment in March, 2015.
Once a term sheet on the equity participation is finalized the Developer will proceed to
closing. The loan will close within 45 days from the date Developer has secured the
equity, anticipated to be mid-June, 2015. Once all of the financing is in place, the
108
Pagel ORIGINAL BID
AWOR AGREEMENT
Developer would then fast track the work required for the Phase I building permit and
Final PD submittal. The Developer at that point shall provide notice to City that the debt
and equity are in place and the project is financed and is proceeding toward Final PD
and building permits.
Building Permits: The Final PD shall be approved and all construction plans and
specifications for the Project shall be complete and Building Permits necessary for the
construction of foundations and the building shell, including without limitation walls and roofs,
shall be applied for and obtained prior to commencement of demolition of any portion of the City
Property.
Section 5. Except as expressly provided above, all other terms and conditions of the Purchase
and Sale Agreement, as amended, shall remain unchanged and in full force and effect.
[SIGNATURES ON THE FOLLOWING PAGE]
Page 2 109
IN WITNESS WHEREOF, the Parties have executed this Agreement as of the
dates stated below.
"CITY"
City of Palm Springs
Date: O'V.Z 7/ZO 15 By:
David H. Ready,
City Manager
APFROvtM E'f rl"!COl!tlul�
APPROVED FORM: ATTEST:
By: By: _
Doug la d'.IH olland, ,Ames Thompson,
City Attorney City Clerk
"DEVELOPER"
SELENE PALM SPRINGS, LLC
Date: yJ,-7-0 11 r y.
XLaur K i b b y
CDI Ventures, LLC
Managing Member
Page 3
110
CALIFORNIA ALL- PURPOSE
CERTIFICATE OF ACKNOWLEDGMENT
A notary public or other officer completing this certificate verifies only the identity
of the individual who signed the document to which this certificate is attached,
and not the truthfulness, accuracy, or validity of that document.
State of California }
County of
On qhe, before me, �, 5_ �v
(Here rose ame and file at the criicer
personally appeared la'/111 lcl64
who proved to me on the basis of satisfa6tory evidence to be the person(s) whose
name(s) is/are subscribed to the within instrument and acknowledged to me that
tie/she/they executed the same in his/her/their authorized capacity(les), and that by
his/her/their signature(a) on the instrument the person(s), or the entity upon behalf of
which the person(,g) 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.
KIIAeERCY S.F1AYo
CemeYuion•1957054
WITNESS my hand and official seal. oth NouryPublic-calnornla
Riveraida County
Comm:Expires Oct 17,2015+
��rc o c/
No ary Public Sign re (Notary Public Seal)
ADDITIONAL OPTIONAL INFORMATION Thi INSTRUCTIONS FOR COMPLETING THIS FORM
s form complies with current California statutes regarding notary wording and.
DESCRIPTION OF THE ATTACHED DOCUMENT if needed,should be completed and attached to the document.Acknowledgments
from other states may be completedfor documents being sent to that slate so long
as the wording does not require the California notary to violate California notary
lmv.
(TN or descdpfion of attached d0 ment) - State and County information must be the State and County where the document
signer(s)personally appeared before the notary public for acknowledgment.
(Title or description of attached document continued) - Date of notarization must be the date that the signers)personally appeared which
must also be the same date the acknowledgment is completed.
• The notary public must print his or her name as it appears within his or her
Number of Pages Document Date commission followed by a comma and then your title(notary public).
• Print the name(s) of document signer(s) who personally appear at the time of
notarization.
CAPACITY CLAIMED BY THE SIGNER - Indicate the correct singular or plural forms by crossing off incorrect forms (i.e.
El Individual (s) he/she/they,is/are)or circling the correct forms.Failure to correctly indicate this
information may lead to rejection of document recording.
❑ Corporate Officer - The notary seal impression must be clear and photographically reproducible.
Impression must not cover text or lines. If seal impression smudges, re-scat if a
(Title) sufficient area permits,otherwise complete a different acknowledgment form.
❑ Partner(s) a Signature of the notary public must match the signature on file with the office of
the county clerk.
❑ Attorney-in-Fact Additional information is not required but could help to ensure this
❑ Trustee(s) acknowledgment is not misused or attached to a different document.
❑ Other Indicate title or type of attached document,number of pages and date.
Indicate the capacity claimed by the signer. If the claimed capacity is g
corporate officer,indicate the title(i.e.CEO,CFO,Secretary). li 1 1
2015 Version www.blotaryCiasses.com 800-873-9865 Securely attach this document to the signed document with a staple.
AMENDMENT NO. 4 TO PURCHASE AND SALE AGREEMENT (SELENE)
THIS AMENDMENT NO. 4 TO PURCHASE AND SALE AGREEMENT ("Amendment') is made and
entered into by and between the City of Palm Springs, a California charter city ("City') and Selene Palm
Springs, LLC, a California limited liability company ("Developer").
RECITALS
A. City entered into a Purchase and Sale Agreement with a predecessor company of
Developer on March 6, 2013 for the purpose of developing and maintaining a Dolce Hotel Project
("Hotel") on property owned by the City.
B. The Purchase and Sale Agreement has been amended three previous times to address
delays caused by changes in state law and the additional reviews and oversight required to comply with
the requirements of state law and to fully satisfy certain requirements of state law. In addition,
Developer and City have identified and are in the process of implementing a financing tool to fund
replacement public parking that will also require additional time to complete. This Amendment will
modify the performance schedule in response to such delays.
NOW, THEREFORE, in consideration of the foregoing Recitals and promises and covenants
contained in this Agreement, the City and Developer agree as follows:
Section 1. The foregoing Recitals are true and correct.
Section 2. Section 7 of the Purchase and Sale Agreement is amended to read:
7. Purchase Date. Property shall be purchased prior to the start of construction by
Developer but no later than June 30, 2016. Escrow shall be opened no less than thirty (30) days before
the anticipated Purchase date.
Section 3. The term "City Attorney" as used in Section 8 of the Purchase Agreement shall mean the
City Attorney of City and the City's Financial Consultant, as designated by the City Manager.
Section 4. Section 15 of the Purchase and Sale Agreement is amended to read:
15. Anticipated Opening Date of the Hotel: September 30, 2018
Section 5. Section 16 of the Purchase and Sale Agreement is amended to read:
16. Benchmark Schedule:
Entitlements: No later than 9 month from close of escrow or December 15, 2016,
whichever is later, for completion of the Final Planned Development Permit and
submission of building permit applications to the City's Building Department.
Start of Construction: Within 15 months of the close of escrow on the sale of the
Property from the City to the Developer.
112
Opening Date: Expected September 30, 2018 but no later than December 31, 2018.
Section 6. Subsection h is added to Section 18 (Developer's Obligations at Closing)to read:
g. At all times after the Close of Escrow and until the Developer commences
construction, Developer shall allow the City Property to be used as a parking lot, available to the public
at no cost.
Section 7. Section 19 of the Purchase and sale Agreement is amended in its entirety to read:
19, Default Repurchase Conditions.
a. Option to Repurchase Upon Failure to Commence Construction. City and
Developer acknowledge and agree that as a material consideration inducing the City to enter into this
Agreement and sell the City Property to Developer, Developer intends to commence construction, and
has received various discretionary development entitlements for, a First Class Hotel on the City property
on or before the date for the Start of Construction identified in the Benchmark Schedule above. For the
purposes of this Section 19, the Parties acknowledge that the Hotel Project as previously approved by
the City as a Preliminary Planned Development, is a "First Class Hotel." For the purposes of this Section,
the term "commence construction" shall mean Developer has: (1) completed all pre-construction
engineering and design, (2) has entered into binding and enforceable agreements with General
Contractor and MEP and Structural contractors (consistent with industry practice), and (3) received
permits, licenses, and entitlements from all government entities, including the City, as can reasonably be
considered necessary so that physical construction of the Hotel Project may begin and proceed to
completion without foreseeable interruption of material duration. The City and Developer hereby
further acknowledge and agree that if Developer should fail to commence construction of the Hotel
Project at the City property on or before the Start of Construction Date, and fails to cure the same
within sixty (60) days following written notice thereof by City, City shall have the option (as its sole and
exclusive remedy) to repurchase the Property from Buyer (the "Repurchase Option A"), subject to the
terms and conditions set forth in this Section 19a. Notwithstanding anything to the contrary contained
herein, City's Repurchase Option A shall vest and come into existence only upon the occurrence of the
Start of Construction Date, and only in the event Developer should fail to commence construction of the
Hotel Project at the City Property on or before the Start of Construction Date and fails to cure the same
within sixty (60) days following written notice thereof by City. In the event Developer commences
construction of the Hotel Project at the City Property on or before Start of Construction Date (or, if
applicable, within sixty (60) days following written notice by the City), the Repurchase Option A shall
automatically terminate and be of no further force or effect.
b. In the event Developer fails to commence construction of the Hotel Project at
the City Property on or before the Start of Construction Date, and fails to cure the same within sixty (60)
days following written notice thereof by the City, City shall have the right to exercise the Repurchase
Option A by written notice to the Developer (the "City's Repurchase Election Notice") delivered no later
than six (6) months after the Start of Construction Date. In the event City fails to timely and properly
exercise its Repurchase Option A, the Repurchase Option A shall automatically terminate and be of no
113
further farce or effect. In the event City timely and properly exercises its Repurchase Option A, the
purchase price payable by City to Developer with respect to the City Property shall be an amount equal
to the Purchase Price paid by Developer to City hereunder for the City Property or the fair market, as
determined through an appraisal of the City Property, acceptable to both parties, whichever amount is
higher. In the event the City timely and properly exercises it Repurchase Option A, then (i) the closing
shall occur on the date specified in the Repurchase Election Notice, which shall be no earlier than sixty
(60) days and no later than one hundred and eighty (180) days after the date of the City's service on
Developer of the Repurchase Election Notice, (ii) Developer and City shall each pay one-half (1/2) of the
escrow fees, (iii) Developer shall pay for (1) any documentary tax stamps and (2) an ALTA standard
Owner's Policy of Title Insurance in the full amount of the purchase price showing fee title vested in the
City; and (iv) the City shall pay the recording fee for any other instruments which are recorded through
such escrow.
C. Option to Repurchase in the event of a Failure to Complete Construction or
Timely Open the Hotel. The City and Developer acknowledge and agree that if Developer should fail to
complete the construction of the Hotel Project at the City property on or before the Opening Date as
provided in the benchmark Schedule, and fails to cure the same within sixty (60) days following written
notice thereof by City, City shall have the option (as one of its remedies) to repurchase the Property
from Buyer (the "Repurchase Option B"), subject to the terms and conditions set forth in this Section
19c. Notwithstanding anything to the contrary contained herein, City's Repurchase Option B shall vest
and come into existence only upon the occurrence of the Opening Date, and only in the event Developer
should fail to complete construction of, and/or open the Hotel Project at the City Property on or before
the Opening Date and fails to cure the same within sixty (60) days following written notice thereof by
City. In the event Developer completes the construction of, and opens, the Hotel Project at the City
Property on or before Opening Date (or, if applicable, within sixty (60) days following written notice by
the City), the Repurchase Option B shall automatically terminate and be of no further force or effect.
d. In the event Developer fails to complete construction of and open the Hotel
Project at the City Property on or before the Completion Date, and fails to cure the same within sixty
(60) days following written notice thereof by the City, City shall have the right to exercise the
Repurchase Option B by written notice to the Developer (the "City's Repurchase Election Notice")
delivered no later than six (6) months after the Opening Date. In the event City fails to timely and
properly exercise its Repurchase Option B, the Repurchase Option B shall automatically terminate and
be of no further force or effect. In the event City timely and properly exercises its Repurchase Option B,
the purchase price payable by City to Developer with respect to the City Property shall be an amount
equal to the Purchase Price paid by Developer to City hereunder for the City Property; plus any cash
payments previously paid by the Developer for the development of the City Property since October 1,
2013 for the improvements thereon, financed costs associated with design and entitlements, amounts
financed inclusive of all "hard" and "soft" costs related to the site and the improvements to be
constructed thereon, including without limitation, architectural, engineering, and legal fees, paid to
government entities, cost of all on-site labor and materials for the construction of the improvements
existing on the City Property at the time of repurchase pursuant to Section 19c and 19d (but not
including any payment under the Services Agreement between the City and Developer for the
114
construction of Parking Facilities), or the fair market value of the City Property, including any
improvements thereon, as determined through an appraisal of the City Property as of the date of Notice
of Repurchase Option B performed by an appraiser hired by the City and the Developer, whichever
amount is lower In the event the City timely and properly exercises it Repurchase Option B, then (i) the
closing shall occur on the date specified in the Repurchase Election Notice,which shall be no earlier than
sixty (60) days and no later than one hundred and eighty (180) days after the date of the City's service
on Developer of the Repurchase Election Notice, (ii) Developer and City shall each pay one-half (1/2) of
the escrow fees, (iii) Developer shall pay for (1) any documentary tax stamps and (2) an ALTA standard
Owner's Policy of Title Insurance in the full amount of the purchase price showing fee title vested in the
City; and (iv) the City shall pay the recording fee for any other instruments which are recorded through
such escrow.
Section 8. Except as expressly provided above, all other terms and conditions of the Purchase and
Sale Agreement, as amended, shall remain unchanged and in full force and effect.
The Parties have executed this Agreement and acknowledge November 4, 2015 as the effective
date of this Agreement.
"City'
City of Palm Springs
Date: !� / 9 /J� B
David H. Read
City Manager
APPROVED AStZ FORM ATTEST
Do glasHolland j/ James Thompson
City Attorney City Clerk
APPROVED BY CITY COUNCIL Developer
t /e=1L2015 �� Selene Palm Springs, LLC
Date: � l�l OB :
Lau i Kibby for CDI Ventur C
Managing MemberforS lene alm
Springs, LLC
115
AMENDMENT NO. 5 TO PURCHASE AND SALE AGREEMENT (SELENE)
THIS AMENDMENT NO. 5 TO PURCHASE AND SALE AGREEMENT ("Amendment") is made and
entered into by and between the City of Palm Springs, a California charter city ("City") and Selene Palm
Springs, LLC, a California limited liability company ("Developer").
RECITALS
A. City entered into a Purchase and Sale Agreement with a predecessor company of
Developer on March 6, 2013 for the purpose of developing and maintaining a Dolce Hotel Project
("Hotel") on property owned by the City.
B. The Purchase and Sale Agreement has been amended four previous times to address
delays caused by changes in state law and the additional reviews and oversight required to comply with
the requirements of state law and to fully satisfy certain requirements of state law. Escrow for the sale
of the property has opened; however, the parties wish to extend the close of escrow one additional
month.
NOW, THEREFORE, in consideration of the foregoing Recitals and promises and covenants contained in
this Agreement, the City and Developer agree as follows:
Section 1. The foregoing Recitals are true and correct.
Section 2. Section 7 of the Purchase and Sale Agreement is amended to read:
7. Purchase Date. Property shall be purchased prior to the start of construction by
Developer but no later than July 31, 2016. Escrow shall be opened no less than thirty (30) days before
the anticipated Purchase date.
Section 3. Except as expressly provided above, all other terms and conditions of the Purchase and
Sale Agreement, as amended, shall remain unchanged and in full force and effect.
116
The Parties have executed this Agreement and acknowledge November 4, 2015 as the effective
date of this Agreement.
"City"
City of Palm Springs
Date: By:__
David H. Ready
City Manager
APPROVED AS TO FORM ATTEST
By By:
Douglas Holland James Thompson
City Attorney City Clerk
Developer
Selene Palm Springs, LLC
Date: By:
Lauri Kibby for CDI Ventures, LLC
Managing Member for Selene Palm
Springs, LLC
117
The Parties have executed this Agreement and acknowledge November 4, 2015 as the effective
date of this Agreement.
"City"
City of Palm Springs
Date: By:
David H. Ready
City Manager
APPROVED AS TO FORM ATTEST
By: By:
Douglas Holland James Thompson
City Attorney City Clerk
Developer
Selene Palm Springs, LLC
Date: By:
Lauri Kibby for CDI Ventures, LLC
Managing Member for Selene Palm
Springs, LLC
AMENDMENT NO. 6 TO PURCHASE AND SALE AGREEMENT(SELENE)
THIS AMENDMENT NO. S TO PURCHASE AND SALE AGREEMENT ("Amendment") is made and
entered into by and between the City of Palm Springs, a California charter city ("City") and Selene Palm
Springs, LLC, a California limited liability company("Developer").
RECITALS
A. City entered into a Purchase and Sale Agreement with a predecessor company of
Developer on March 6, 2013 for the purpose of developing and maintaining a Dolce Hotel Project
("Hotel") on property owned by the City.
B. The Purchase and Sale Agreement has been amended previously to address delays
caused by changes in state law and the additional reviews and oversight required to comply with the
requirements of state law and to fully satisfy certain requirements of state law. Escrow for the sale of
the property has opened; however, the parties wish to extend the close of escrow to the close of
business on August 29, 2016.
NOW, THEREFORE, in consideration of the foregoing Recitals and promises and covenants contained in
this Agreement, the City and Developer agree as follows:
Section 1. The foregoing Recitals are true and correct.
Section 2. Section 7 of the Purchase and Sale Agreement is amended to read:
7. Purchase Date. Property shall be purchased prior to the start of construction by
Developer but no later than August 29, 2016. Escrow shall be opened no less than thirty (30) days
before the anticipated Purchase date.
Section 3. Except as expressly provided above, all other terms and conditions of the Purchase and
Sale Agreement, as amended, shall remain unchanged and in full force and effect.
SERVICES AGREEMENT
This Agreement (this "Agreement') is made by and between City of Palm Springs
("City"), and CDI Ventures, LLC and/or its affiliates, assigns, successors ("CDP').
1. Purpose of This Agreement: The City and CDI have entered into a Purchase and
Sale Agreement for sale of land owned by the City ("City Property") generally located at the
northeast corner of Amado and Calle Alvarado and is currently used as a public parking lot.
This property together with an approximately 2.89 acre parcel of land CDI will acquire
("Developer Property") will be developed and maintained as the Dolce Hotel Project. The
Developer Property is described as Lot 102 in Sec. 14, Township 4 South, Range 4 East, San
Bernardino Merdian, and is adjacent to and north of the City Property. The Developer desires
City assistance in the acquisition of the Developer Property and to purchase certain
improvements and development rights of the City associated with the City Property.
2. City Services: City shall assist CDI in the assemblage and acquisition of the
Developer Property to accommodate and allow for density requirements for the Dolce Hotel
Project. CDI will pay the City a fee of$675,000 for such services. This payment shall be paid
to City upon the close of escrow of the sale of the Developer Property to CDI.
3. Existing Improvements and Entitlement Rights: Developer shall pay City for
the unamortized parking improvements and the existing entitlements for the development of the
City Property and the Developer Property in an amount of $2,000,000. This payment shall be
paid in fourteen (14) equal monthly installments commencing on the first day of the first month
following the issuance of the first grading or building permit on either the City Property or the
Developer Property.
4. Security: CDI shall furnish security in the form of a bond, or bonds, or cash, or
in such other form as may be approved by the City Manager and the City Attorney, in the
amount or $2,000,000 to guarantee its faithful performance of its obligations under Section 3 of
this Agreement.
5. Miscellaneous
a. Notices. All notices, demands and requests which may be given or which are
required to be given by either party to the other, and any exercise of a right of termination
provided by this Agreement, shall be in writing and shall be deemed effective either:
(a) on the date personally delivered to the address identified in Sections 1 and 2 of the
Purchase and Sale Agreement between the parties above, in the manner provided in
Purchase and Sale Agreement.
b. Entire Agreement. This Agreement embodies the entire agreement between the
parties relative to the subject matter hereof, and there are no oral or written agreements
between the parties, nor any representations made by either party relative to the subject
matter hereof, which are not expressly set forth herein.
Z,�
C. Amendment. This Agreement may be amended only by a written instrument
executed by the party or parties to be bound thereby.
d. Headings. The captions and headings used in this Agreement are for convenience
only and do not in any way limit, amplify, or otherwise modify the provisions of this
Agreement.
E. Time of Essence. Time is of the essence of this Agreement; however, if the final
date of
any period which is set out in any provision of this Agreement falls on a Saturday,
Sunday or legal holiday under the laws of the United States or the State of California ,
then, in such event, the time of such period shall be extended to the next day which is not
a Saturday, Sunday or legal holiday.
f. Governing Law. This Agreement shall be governed by the laws of the State of
California and the laws of the United States pertaining to transactions in such State.
g. Invalid Provision. If any provision of this Agreement is held to be illegal, invalid
or unenforceable under present or future laws, such provision shall be fully severable;
this Agreement shall be construed and enforced as if such illegal, invalid or
unenforceable provision had never comprised a part of this Agreement; and, the
remaining provisions of this Agreement shall remain in full force and effect and shall not
be affected by such illegal, invalid, or unenforceable provision or by its severance from
this Agreement.
h. Attorneys' Fees. In the event it becomes necessary for either party hereto to file
suit to enforce this Agreement or any provision contained herein, the party prevailing in
such suit shall be entitled to recover, in addition to all other remedies or damages, as
provided herein, attorneys'fees and expenses incurred in such suit.
i. Multiple Counterparts. This Agreement may be executed in a number of identical
counterparts which, taken together, shall constitute collectively one (1) agreement; in
making proof of this Agreement, it shall not be necessary to produce or account for more
than one such counterpart with each party's signature.
j. Effective Date. As used herein the term "Effective Date" shall mean the date of
approval by the City Council.
City of Palm Springs CDI Ventures, LLC
By: By:
Name:p � id SUS . Name: IV,Y/.
Title: \r l Y "� Title: Afei—Aay-
Date: l 2013 Date: 3-a7-13
A^ "', C Y CITE COUNCIL ATTEST:
•b• eo��, yc. lAb�2�1
ity Clerk
c. Amendment. This Agreement may be amended only by a written instrument
executed by the party or parties to be bound thereby.
d. Headings. The captions and headings used in this Agreement are for convenience
only and do not in any way limit, amplify, or otherwise modify the provisions of this
Agreement.
E. Time of Essence. Time is of the essence of this Agreement; however, if the final
date of
any period which is set out in any provision of this Agreement falls on a Saturday,
Sunday or legal holiday under the laws of the United States or the State of California ,
then, in such event,the time of such period shall be extended to the next day which is not
a Saturday,Sunday or legal holiday.
f. Governing Law. This Agreement shall be governed by the laws of the State of
California and the laws of the United States pertaining to transactions in such State.
g. Invalid Provision. If any provision of this Agreement is held to be illegal,invalid
or unenforceable under present or future laws, such provision shall be fully severable;
this Agreement shall be construed and enforced as if such illegal, invalid or
unenforceable provision had never comprised a part of this Agreement; and, the
remaining provisions of this Agreement shall remain in full force and effect and shall not
be affected by such illegal, invalid, or unenforceable provision or by its severance from
this Agreement.
h. Attorneys'Fees. In the event it becomes necessary for either party hereto to file
suit to enforce this Agreement or any provision contained herein, the party prevailing in
such suit shall be entitled to recover, in addition to all other remedies or damages, as
provided herein,attorneys'fees and expenses incurred in such suit.
i. Multiple Counterparts. This Agreement may be executed in a number of identical
counterparts which, taken together, shall constitute collectively one (1) agreement; in
making proof of this Agreement, it shall not be necessary to produce or account for more
than one such counterpart with each party's signature.
j. Effective Date. As used herein the term 'Effective Date' shall mean the date of
approval by the City Council.
City of Palm Springs CDI Ventures,LLC
By: By:
Name: Name: W;Ihb. W.
Title: Title: wt�ber
Date: Date: 3-a7-13
APPROVED AS TO FORM:
BY
Title:
122
AMENDMENT N0. 1 TO SERVICES AGREEMENT(SELENE)
THIS AMENDMENT NO. 1 TO SERVICES AGREEMENT ("Amendment") is made and entered into
by and between the City of Palm Springs, a California charter city("City') and Selene Palm Springs, LLC, a
California limited liability company ("Developer"), the successor to Praetor Investments, LLC and CDI
Ventures, LLC.
RECITALS
A. City entered into a Services Agreement with a predecessor company of Developer on
March 6, 2013 for the purpose of providing for the assemblage and acquisition of certain property and
to provide funding for replacement parking within a parking structure and/or parking facilities on the
City's Convention Center Parking Lot in conjunction with the Dolce Hotel Project proposed for
development by the Developer. '
B. Developer and City have identified and are in the process of implementing a financing
tool to fund replacement public parking and Developer will construct an onsite parking structure that
will garage at least 350 public parking spaces in a parking structure in addition to otherwise satisfying
the on-site parking requirements of the Dolce Hotel Project. The Parties anticipate that the parking
structure and related parking improvements will be funded through the Statewide Community
Infrastructure Program ("SCIP"). City has joined SCIP and has commenced the process of forming a
Community Facilities District to be funded in part through SCIP.
NOW, THEREFORE, in consideration of the foregoing Recitals and promises and covenants
contained in this Agreement, the City and Developer agree as follows:
Section 1. The foregoing Recitals are true and correct.
Section 2. Section 1 of the Services Agreement is amended to read:
1. Purpose of This Agreement: The City and Developer have entered into a Purchase and
Sale Agreement for the sale of land owned by the City ("City Property") generally located at the
northeast corner of Amado and Calle Alvarado and is currently used as a public parking lot. The City
Property will be developed and maintained as the Dolce Hotel Project. The Parties acknowledge that
the construction of the Dolce Hotel Project will displace the existing public parking spaces on the City
Property and it is the desire of the Parties that the existing parking spaces be replaced within a parking
structure and related parking facilities ("Parking Facilities") that Developer will construct and maintain in
conjunction with the Dolce hotel Project.
Section 3. Section 2 of the Services Agreement is deleted in its entirety.
Section 4. Section 3 of the Services Agreement is amended to read:
3. Existing Improvements and Entitlement Rights: Developer shall pay City the amount of
$2,675,000.00 for the unamortized parking improvements necessary or desirable for the construction of
123
at least 350 public parking spaces within the Parking Facilities to replace existing public parking spaces
on the City Property that will be lost as a result of the sale of the City property to the Developer and the
construction of the Dolce Hotel Project. Prior to or upon the issuance of a building permit, the Developer
shall cause the full $2,67S,000.00 to be deposited in an escrow account designated and approved by the
City to be held by the City until such time as the funds are required to fund all or a portion of
contributions necessary for the SCIP and the construction of the Parking Facilities. This payment will be
deposited in a trust account approved by and for the benefit of the City to be used solely for funding
replacement public parking.
Section S. Except as expressly provided above, all other terms and conditions of the
Purchase and Sale Agreement, as amended, shall remain unchanged and in full force and effect.
The Parties have executed this Agreement and acknowledge November 4, 2015 as the effective
date of this Agreement.
"City"
City of Palm Springs
i
Date: // / / By. /
David H. Read
City Manager
APPROVED A ORM ATTEST
By: By:
Dou as Holland James Thompson
City Attorney City Clerk
APPROVED 13Y CITY COUNCIL Developer
I 1 /ds{/,ZO15 $, r: • Selene Palm Springs, LLC
/hra32`J
Date: 1k 1 Q I �f
La ri Kibby for CDI Ventur , L C,
Managing Member of Sele Im
Springs, LLC
124
Date: May 27,2016 Escrow No.: 26485-KC
Page 2 of 6:Additional instructions made a part of previous pages as fully incorporated therein.
LIBERTY ESCROW INC.
200 North Sunrise Way,Suite A Palm Springs,CA92262
(760)322-2050 FAX: (760)322-2157
AMENDED SALE ESCROW INSTRUCTIONS Escrow No.: 26485-KC
Kristy J.Cordell Date: May 25,2016
Certified Senior EscrowOfficer
THIS ESCROW HOLDER IS LIBERTY ESCROW INC.WHICH IS LICENSED BY THE CALIFORNIA DEPARTMENT OF
BUSINESS OVERSIGHT LICENSE 99631777
Not withstanding the deposit specified in the PSA,the Buyer will hand LIBERTY ESCROW INC.,on or before June 1,
2016,initial deposit in the amount of 500,000.00
Prior to close of escrow, buyer will deposit an additional amountof 1,500,000.00
Total Consideration $2,000,000.00
INVe will deliver to you any instruments which this escrow requires shall be executed by me,all of which you are instructed
to use provided that on or before(August 29,2016),and when you are in a position to obtain a policy of title insurance
through Orange Coast Title Company,with the usual title company's exceptions,with a liability of$2,000,000.00(less
value of personal property,if any)covering property:
LEGAL DESCRIPTION ATTACHED HERETO AS EXHIBIT'W'AND MADE A PART HEREOF
PROPERTY ADDRESS:3 lots known as APN 508-034-012,508-034-013 and 508-034-014, Palm Springs,CA
SHOW TITLE VESTED IN: Selene Palm Springs,LLC,a California Limited LiabilityCompany
FREE FROM ENCUMBRANCES EXCEPT:
(1) All General and special Taxes for the fiscal year 2014 and 2015,and/or supplemental taxes assessed pursuant to
the provisions of Chapter 498,Statutes of 1983 of the State of California.(Change of Ownership will affect the
taxes to be paid.A Supplemental Tax Bill will be issued and BUYER accepts all responsibility for all additional
taxes due because of said reassessment.TAX BILLS ISSUED AFTER THE CLOSE OF ESCROW SHALL BE
HANDLED DIRECTLY BETWEEN BUYERS ANDSELLERS.)
(2) Covenants,conditions,restrictions,reservations,rights,rights of way,and easements,and any oil,gas,or mineral
reservations now of record,if any.
INSTRUCTIONS:
A. Buyer and Seller have entered into that certain"Purchase and Sale Agreement"as thereafter amended by four(4)
amendments,(the Agreement),which are attached hereto and made a part hereof. Liberty Escrow,Inc. has
agreed to act as escrow agent in connection with same subject only to those items for which escrow offer is
responsible,which are supplemented by these instructions.
B. The following are additional instructions to the above paragraph:
1.Pursuant to Developer's letter submitted to Owner on December 23,2015 in compliance with
Paragraph 36 of the Purchase and Sale Agreement,the Developer's bridge lender is Beech Tree
Capital.
2.Grant Deed shall include the following deed restriction:
Buyer grants Seller the right to maintain,operate,and use the property as a parking lot,at no
cost to Seller, until such time as the Buyer or Buyers Successor commences construction as
contemplated and defined in Amendment No.4 to the Purchase and Sale Agreement between
the Grantor and Grantee executed by the parties dated November 19,2015. Upon the
commencement of construction as defined herein,this deed restriction shall terminate.
3. Grant Deed shall include the following deed restriction:
Buyer shall install on the property public parking together with rights of access, ingress,and
(CONTINUED) 1, 125
Seller's Initials: ! Buyer's Initials: !
Date: May 27,2016 Escrow No.: 26485-KC
Page 3 of 6:Additional instructions made a part of previous pages as fully incorporated therein.
egress over appropriate areas of the property for the purpose of using such parking spaces for
use of the general public in perpetuity. Buyer's obligations,which accrue solely to the named
Buyer,or an assignee of the Buyer approved by the Seller(whose approval shall not be
unreasonably withheld),under this restriction,shall be deemed fully satisfied through Buyer's or
Buyer's approved assignee's performance of its obligations pursuant to the Services Agreement,
as amended,between the Buyer and the Seller. Upon completion of,and issuance of an
occupancy permit for,a parking structure pursuant to the Services Agreement,this restriction
shall terminate. Any other successor of Buyer in the property, including without limitation any
successor following a default of Buyer under the Purchase and Sale Agreement or the Services
Agreement,shall pay to the City the amount of Two Million,Six Hundred and Seventy Five
Thousand Dollars($2,675,000.00),prior to the issuance of a building permit on the property,and
such amount shall be increased annually by increases in the consumer price index for all urban
consumers for the Los Angeles-Riverside-Orange County Standard Metropolitan Statistical Area
as reported by the United States Bureau of Labor Statistics,or any successor to such index.
C. Buyer and Seller authorize and instruct Escrow Holder to accept and act on signature(s)throughout this escrow in
the form of photo copies,e-mail or faxes,as defined in this Escrow as though they were original signature(s),to
open escrow and for other purposes.
D. ASSEMBLY BILL 512: "GOOD FUNDS LAWS".AB 512 enacts a new Section 12413.1 to the State of California
Insurance Code that regulates real estate escrow disbursements by title insurance companies,controlled escrows
and underwritten title companies.The Bill requires that checks be deposited by the title company prior to escrow
disbursement.
THE NEW LAW ESTABLISHED A THREE-TIER SYSTEM TO DETERMINE WHEN DISBURSEMENT MAY
OCCUR.
1)Cash and"Wired Funds"may be disbursed on the same day asdeposited.
2)Tellers checks,cashier's checks and certified checks may disbursed on the first business day following the
day of deposit.(A teller's check is defined as a check drawn by an insured financial institution against another
insured financial institution.)
3)Personal checks,corporate checks and drafts received from title companies(including escrow trust checks)may
be disbursed on the day when the item must be made available for withdrawal by depositors under Regulation CC
adopted by the Federal Reserve Board of Governors. Until September 1, 1990,the hold period on these items
is three(3)business days following the date of deposit of local checks and seven(7)business days following the
date of deposit of non-local checks;after September 1, 1990,these hold periods will be reduced to two(2)
business days following the date of deposit for local checks and five(5)business days following date of deposit for
non-local checks.
Please prepare for delayed disbursement of funds to all recipients at the close of escrow.
All parties are aware that NO interest will be paid to recipients of funds from Liberty Escrow Inc.as a result of this
delay as outlined under Senate Bill 1550.
NO ESCROW WILL RECORD UNTIL THE ABOVE REQUIREMENTS HAVE BEEN MET. NO EXCEPTIONSII
E. CLOSING FUNDS:Each party acknowledges that the close of escrow is conditioned on checkclearances.
Funds to close must be in the form of a Cashier's Check drawn on a bank with clearing house in the State of
California OR be wire transfer to Liberty Escrow Inc.Trust Account two(2)days prior to recording of documents.
ALL FINAL FUNDS IN EXCESS OF$100,000.00 MUST BE WIRE TRANSFERRED.
If you wish to wire transfer US funds to Liberty Escrow Inc.,please use the following format:
WIRE TRANSFER INSTRUCTIONS
LIBERTY ESCROW INC.
Receiving Bank: OPUS BANK
Specialty Deposits
19900 MacArthur Blvd., 12th Floor
Irvine,CA 92612
Bank Routing Number: 122239270
Account Name: Liberty Escrow Inc.
Account Number: 10932929
Reference: Escrow No.26485-KC
Attn: Kristy J.Cordell
THE WIRE TEXT MUST BE EXACTLY AS INDICATED ABOVE.ANY EXTRANEOUS INFORMATION MAY
CAUSE UNNECESSARY DELAYS IN CONFIRMING THE RECEIPT OFFUNDS.
F. PRORATIONS: Prorate as of Close of Escrow
Real Property taxes based on latest tax bill or on amount furnished by title company.
(CONTINUED)
Sellers Initials: 1 Buyer's Initials: 1
Date: May 27,2016 Escrow No.: 26485-KC
Page 4 of 6:Additional instructions made a part of previous pages as fully incorporated therein.
ADDITIONAL ESCROW INSTRUCTIONS AND CONDITIONS
1. You are instructed to deposit all funds received by you with any state or national bank,slate or federal savings bank,or state
of federal savings and loan association,in trust account in the name of escrow holder,without any liability for payment of interest. The
funds may be withdrawn by you and disbursed according to the instructians of the parties.All deposits made by personal check,
cashiers check,certified check or deposit other than cash orwire transfer are subject to clearance and payment by financial institution
on which drawn.All disbursements are to be made by check or escrow holderform the trust account.Neither you nor any of your
employees will identify any payee or guarantee signatures of any person or entity at any financial institution.Funds deposited into
escrow in the form of a check,draft,or similar instrument will be identified as collected funds when the escrow holder's financial
institution confirms that the funds are available for disbursement.
2. Your duty is to act as escrow holder only and does not commence and escrow shall not be deemed opened until mutual
escrow instructions signed by all parties are received by you.Until mutually executed escrow instructions are received,either party
may unilaterally revoke these instructions by written request delivered to you and may withdraw any funds,instruments,documents or
items previously handed to you.
3. All prorations and adjustments are to be made on the basis of a thirty(30)day month unless otherwise instructed in writing by
all parties.For proration purposes,the Buyer will have ownership of the real property which is the subject of this escrow for the entire
day,regardless of the hour of recording.The"close of escrow"with reference to prorations,adjustments and all purposes in this
escrow shall be the day the instruments of conveyance are recorded or filed with the county recorder.
4. Any funds disbursed during or on the close of escrow will be issued jointly to the parties designated as payees unless you are
Instructed otherwise in writing by all designated payees.The funds representing loan and/or sale proceeds will be disbursed jointly to
all persons who were the record owners of the real property which is the subject of the escrow.All disbursements of funds and/or
delivery of other documents or instruments concerning this escrow will be mailed to the entitled parties by regular first-class mail,
postage prepaid,at their respective addresses shown on file.However,at your discretion,you may send funds and/or other
instruments or documents by certified or registered mail,federal express,messenger or facsimile machine,in which case the party for
whom the delivery was made agrees to pay the costs.The provisions of this paragraph include,but are not limited to,request for
demand statements,requests for beneficiary statements,request for homeowners'association statements or any other requests as
you may deem necessary for the timely closing of this escrow.You are to instruct the county recorder to mail recorded documents to
the entitled parties at their respective addresses.You are to instruct the title company to mail the title policy(s)to the Lenders)or
Buyer(s)as appropriate.
5. In addition to other costs and charges set forth in escrow instructions,Seller agrees to pay on demand,whether or not this
escrow closes,all expenses and charges incurred by you on Seller's behalf,including,but not limited to,charges for preliminary title
reports,title commitments,policies of title insurance,beneficiary statements,beneficiary demands,offset statements,documentary
transfer tax stamps,preparation of,notarizing and recording of documents necessary in Seller's behalf,one-half(1/2)of sub-escrow
fee,Seller's escrow fee and other costs as charged.In addition to the other costs and charges set forth in these escrow instructions,
Buyer agrees to pay on demand,whether or not this escrow closes,all expenses and charges incurred by you on Buyer's behalf,
including,but not limited to,recording fees,preparation of notarizing and recording trust deed(s)and other documents on Buyers
behalf,new loan charges,existing loan assumption transfer fees,one-half(112)of sub-escrow fees,Lender's policy of title insurance,
fire insurance premiums,Buyer's escrowfee and other costs as charged.
6. NOTWITHSTANDING ANY PROVISIONS TO THE CONTRARY CONTAINED IN THESE ESCROW INSTRUCTIONS OR
SUPPLEMENTS OR AMENDMENTS,ESCROW HOLDER SHALL NOT BE RESPONSIBLE FOR THE SUFFICIENCY,VALIDITY OR
CORRECTNESS OF ANY SIGNATURE OF ANY PRINCIPAL TO THIS ESCROW OR ANY THIRD PARTY TO THIS ESCROW,NOR
FOR THE SUFFICIENCY OR CORRECTNESS AS TO FORM,MANNER OF EXECUTION OR VALIDITY OF ANY DOCUMENTS
DEPOSITED IN THIS ESCROW,NOR AS TO THE IDENTITY,AUTHORITY,OR RIGHT OF ANY PERSONS EXECUTING THE
SAME,EITHER AS TO DOCUMENTS OF RECORD OR THOSE HANDLED IN THIS ESCROW.SHOULD THE PARTIES DESIRE
THAT YOU VERIFY THE SIGNATURES ON INSTRUCTIONS RECEIVED BY YOU,THE PARTY(IES)WITHOUT FURTHER
INSTRUCTIONS AUTHORIZED THE PAYMENT OF AN ESCROW FEE COMPUTED AT TWO TIMES YOUR REGULAR ESCROW
FEE AND WILL DELIVER SEPARATE WRITTEN ESCROW INSTRUCTIONS SPECIFICALLY INSTRUCTING YOU TO DO$0.
7. You shall not be responsible for the following:(1)the sufficiency or correctness as to form,manner of execution or validity of
any documents deposited in this escrow;(2)the identity,authority,or right of any person executing the same,either as to documents
of record of those handled in this escrow;or(3)the failure of any party to comply with any of the provisions of any agreement,contract
or other instrument fled or deposited in this escrow or referred to in these escrow instructions.Your duties shall be limited to the
safekeeping of money and documents received by you as escrow holder and for the disposition in compliance with the written
instructions accepted by you in this escrow.You shall not be required to take any action regarding the collection,maturity,or apparent
outlaw of any obligations deposited with you unless otherwise instructed in writing.
8. You are not to be held responsible in any way whatsoever for any personal property tax which may be assessed against any
former or present owner of the subject property described in these escrow instructions,nor for the corporation or license tax of any
corporation as a former or present owner.
9. If it is necessary,proper or convenient for the consummation of this escrow,you are authorized to deposit or have deposited
funds or documents,or both,handed you under these escrow instructions with any duly authorized sub-escrow agent,including,but
not limited to,any bank,trust company,title insurance company,title company,savings and loan association,or licensed escrow
agent,subject to your order at or before close of escrow in connection with closing this escrow.Any such deposit shall be deemed a
deposit under the meaning of these escrow instructions.
10. The parties to this escrow have satisfied themselves outside of escrow that the transaction covered by this escrow is not in
violation of the Subdivision Map Act or any law regulating land division,zoning ordinances or building restrictions which may affect the
land or improvements that are the subject of this escrow.You,as escrow holder,are relieved of all responsibility and liability in
connection with such laws,ordinances,restrictions or regulations and are not to be concerned with any of their enforcement.
11. If any form of Purchase Agreement or amendment or supplement(collectively"Purchase Agreement")is deposited in this
escrow,it is understood that such document shall be effective only as between the parties signing the Purchase Agreement.You,as
escrow holder,are not to be concerned with the terms of any Purchase Agreement and are relieved of all responsibility and liability for
the enforcement of its terms..Your only duty is to comply with the instructions set forth in the escrow instructions. You are not
(CONTINUED)Seller's Initials: Buyer's Initials: I 127
Date: May 27,2016 Escrow No.: 26485-KC
Page 5 of 6:Additional instructions made a part of previous pages as fully incorporated therein.
responsible for interpreting or acting on any provision of any Purchase Agreement on which these escrow instructions may be based
and you shall not rely on any knowledge or understanding you may have of any such Purchase Agreement in ascertaining or
performing your duties as escrow holder.In connection with any loan transaction,you are authorized to deliver a copy of any
Purchase Agreement,supplement or amendment and a copy of all escrow instructions,supplements or amendments to the Lender.
12. You are not to be concerned with the giving of any disclosures required by federal or state law,including,but not limited to,
Real Estate Settlement Procedures Act,Regulation Z-Truth-In-Lending,condition of the subject property or other warnings,or any
other warranties,express or implied.
13. Except as set forth in Paragraph 14 below,you shall not be responsible and you are released from and shall have no liability,
obligation or responsibility with respect to withholding of funds under§1445 of the Internal Revenue Code of 1954,as amended,
commonly know as the Foreign Investment in Real Property Tax Act("FIRPTA")or the California FIRPTA under§18805,et seq.ofthe
California Revenue&Taxation Code("CAL-FIRPTA"). Advice about FIRPTA or CAL-FIRPTA its requirements,a determination
whether the Sellerttransferor is a foreign person,as defined,or obtaining a non-foreign affidavit or exemption from withholding or other
information concerning compliance or non-compliance will not be given to the parties by the escrow holder.The parties are advised to
seek independent legal,financial and tax counsel from their respective legal,financial and tax advisors.
14. The parties are aware that California law effective January 1,1991 requires you to withhold a sum equal to 3 1/3%of the sale
price under certain conditions where Seller does not reside in the State of Califomia or funds are transmitted outside of California. The
parties agree to prepare and deposit such other and further documents or instruments as are necessary for you to comply with this
instruction and California state law.The parties herewith acknowledge receipt of the Notification of the Califomia Franchise Tax Board
embodying the California state law commonly known as CAL-FIRPTA as stated in California Revenue and Taxation Code§§18805 and
26131.
15. You are authorized to deliver copies of all escrow instructors,supplements and amendments,estimated and final closing
statements,preliminary title reports,and notices of cancellation,if any,to the real estate broker(s),real estate sales agent(s),
Lender(s),Lender's agent(s)and/or attomeys(s)for the parties,upon the parties'oral or written request.You shall not incur any
liability to the parties for delivery of the copies.
16. You shall make no physical inspection of the real property or personal property described in any instrument deposited in or
which is the subject of this escrow.You have made no representations or warranties concerning any such real property or personal
property and are not to be concerned with nor liable for the conditions of real property or personal property.
17. The parties authorize the recordation of any instrument delivered through this escrow if necessary or proper for the issuance
of the required policy of He insurance or for the closing of this escrow.Funds,instructions or instruments received in this escrow may
be delivered to,or deposited with any title insurance company of title company to comply with the terms and conditions of this escrow.
18. You are authorized to deduct from Seller's net proceeds or Buyer's net proceeds any amount which either Seller or Buyer may
owe you in any other matter or transaction.You are authorized to charge and the parties agree to pay additional escrow fees for
extraordinary services not within the range of customary escrow processing,including,but not limited to,the verification of signatories
to escrow instructions.
19. You are to use your usual document forms or the usual forms of any title insurance company or title company and in our
instructions insert dales and terms on the instruments if incomplete when executed.
20. If the date by which Buyer's or Seller's performances are due shall be other than your regular business day,such
performances shall be due on your next succeeding business day.
21. You shall conduct no lien or title search of personal property regarding the sale or transfer of any personal property through
this escrow.Should the party(ies)desire that you conduct a lien or title search of personal property,the party(ies)requesting the same
shall deliver separate and specific written escrow instructions to you along with an agreement to pay your additional escrow fees.
22. You shall not be responsible in any way whatsoever nor are you to be concerned with any question of usury in any loan or
encumbrance,whether new or of record,which may arise during the processing of this escrow.
23. The parties agree to deliver to you all documents,instruments,escrow instructions and funds required to process and close
this escrow in accordance with its terms.
24. You are instructed to provide title to the subject real property in the condition identified in the escrow instructions by the
parties.You are not responsible for the contents or accuracy of any beneficiary demands andlor beneficiary statements delivered to
you by the existing lienholder.You are not required to submit any such beneficiary statement and/or beneficiary demand to the parties
for approval before the close of escrow unless expressly instructed to do so in writing.Should the party(ies)desire to pre-approve any
such beneficiary statement and/or beneficiary demand,the party(ies)requesting the same shall deliver separate and specific written
escrow instructions to you.
25. You are not to be responsible in any way whatsoever nor to be concerned with the terms of any new loan or the content of
any loan documents obtained by any party in connection with this escrow except to order such loan documents into the escrow file,
transmit the loan documents to Buyer for execution and transmit the executed loan documents to Lender.The parties understand and
agree that you are not involved nor concerned with the approval and/or processing of any loan or the contents and effect of loan
documents prepared by a Lender.
26. The parties agree to complete and deliver to you a Statement of Information as required by the title insurance company or title
company.
27. The Federal Tax Reform Act of 1986,as amended,and the California Revenue&Taxation Code,require certain transactions
to be reported to the Internal Revenue Service and the California State Franchise Tax Board.In those transactions Seller will furnish a
correct tax identification number to you so you can report this transaction as required by law.Seller understands that Seller may be
subject to civil or criminal penalties for failure to do so.
28. The parties expressly indemnify and hold you harmless against third-party claims for any fees,costs or expenses where you
have acted in good faith,with reasonable care and prudence and/or in compliance with these escrow instructions.
(CONTINUED)Seller's Initials: ! Buyers Initials: / 1 2n
Date: May 27,2016 Escrow No.: 26485-KC
Page 6 of 6:Additional instructions made a part of previous pages as fully incorporated therein.
29. The parties agree that you have the responsibilities of an escrow holder only and there are no other legal relationships
established in the terms and conditions of the escrow instructions.In connection with this escrow:(1)you shall have no duty or
responsibility of notifying any of the parties to this escrow of any sale,resale,loan,exchange or other transaction involving any of the
subject real property or personal property;(2)you shall have no responsibility or duty to disclose any benefit,including,but not limited
to financial gain,realized by any person,firm or corporation involving any of the subject real property or personal property;and(3)you
shall have no responsibility or duty to disclose any profit realized by any person,firm or corporation including,but not limited to,any
real estate broker,real estate sales agent and/or a party to any other escrow,in connection therewith,although such other transaction
may be handled by you in this escrow or in another escrow transaction.If,however,you are instructed in writing by any party,Lender
or other entitled person to disclose any sale,resale,loan,exchange or other transaction involving any of the subject real property or
personal property or any profit realized by any person,firm or corporation to any party to this escrow,you shall do so without incurring
any liability to any party.You shall not be liable for any of your acts or omissions done in good faith nor for any claims,demands,
losses or damages made or suffered by any party to this escrow,excepting such as may arise through or be caused by you willful
neglect or gross misconduct.
30. Buyer acknowledges that pursuant to the California Revenue 6 Taxation Code a Change of Ownership form is required by the
county recorder to be completed and affixed to any documents submitted for recording which evidence a conveyance of title. The
Change of Ownership form shall be furnished to Buyer by you for Buyers completion and execution.Buyer is aware that if Buyer does
not complete the form in full,sign and return it to you before closing,a penalty will be assessed by the county recorder. If the Change
of Ownership form is not fled after the close of escrow within the time limits set forth by the county recorder,severe additional
penalties will be assessed against the Buyer.FOR INFORMATION AND ASSISTANCE IN COMPLETING THE CHANGE OF
OWNERSHIP FORM,BUYER MAY CONTACT THE COUNTY RECORDER AND ASSESSORS OFFICES IN THE COUNTY IN
WHICH THE SUBJECT PROPERTY IS LOCATED.
31. Notwithstanding any other provisions in these escrow instructions and in addition to other fees and cost to which you may be
entitled,the parties,jointly and severally,agree that if this escrow is not consummated within ninety(90)days of the date set for
closing,you are instructed to,and without further instructions,withhold your escrow hold open fee of$50.00 per month from the funds
on deposit with you regardless of who deposited such funds.The parties,jointly and severally,further agree that if you,for any
reason,required to hold funds after close of escrow,you are instructed to,and without further instructions,withhold an escrow fee of
$50.00 per month from the funds on deposit with you regardless of who deposited such funds.The parties irrevocably instruct you to
automatically cancel this file without further instructions when all funds on deposit have been disbursed.
32. Your escrow holder agency shall terminate six(6)months following date last set for close of escrow and shall be subject to
earlier termination by receipt by you of mutually executed cancellation instructions. If this escrow was not closed or cancelled within
the described six(6)month period,you shall have no further obligation as escrow holder except to disburse funds and documents
pursuant to wntten escrow instructions and to Interplead or otherwise dispose of funds and documents in accordance with a validly
issued and validly served order from a court of competent jurisdiction.If the conditions of this escrow have not been complied with at
the expiratlon date in these escrow instructions,you are instructed to complete the conditions at the earliest possible date,unless
Buyer or Seller have made written demand upon you for the return of the funds and/or instruments deposited by Buyer or Seller and/or
for cancellation of this escrow.Should demands be made upon you,you may withhold and stop all further proceedings in this escrow
without liability for interest on funds held or for damages until mutual cancellation instructions signed by all parties shall have been
deposited with you.The parties,jointly and severally,agree that if this escrow cancels or is otherwise terminated and not closed,the
parties shall pay for any cost and expenses which you have incurred or have become obligated for under these escrow instructions,
including,but not limited to,attomeys'fees,arbitration fees and costs and reasonable escrow fees for the services rendered by you,
the parties agree that such cost and expenses shall be paid and deposited in escrow before any cancellation or other termination of
this escrow is effective.The parties agree that said charges for expenses,costs,and fees may be apportioned between Buyer and
Seller in a manner which,in your sole discretion,you consider equitable,and that your decision will be binding and conclusive upon
the parties.Upon receipt of mutual cancellation instructions of a final order or judgement of a court of competent jurisdiction with
accompanying writs of execution,levies or gamishments,you are instructed to disburse the escrow funds and instruments in
accordance with such cancellation instructions,order or judgment and accompanying writ and this escrow shall,without further notice,
be considered terminated and cancelled.
33. The parties shall cooperate with you in carrying out the escrow instruction they deposit with you and completing this escrow.
The parties shall deposit into escrow,upon request,any additional funds,instruments,documents,instructions,aulhorizaflons,or
other items that are reasonably necessary to enable you to comply with demands made on you by third parties,to secure policies of
title insurance,or to otherwise carry out the terms of their instructions and close this escrow.If conflicting demands or notices are
made or served upon you or any controversy arises between the parties or with any third person arising out of or relating to this
escrow,you shall have the absolute right to withhold and stop all further proceedings in,and in performance of,this escrow until you
receive written notification satisfactory to you of the settlement of the controversy by written agreement of the parties,or by the final
order or judgement of a court of competent jurisdiction.All of the parties to this escrow,jointly and severally,promise to pay promptly
on demand,as well as to indemnify you and to hold you harmless from and against all administrative governmental investigation,audit
and legal fees,litigation and interpleader costs,damages,judgments,attomeys'fees,arbitration costs and fees,expenses,obligations
and liabilities of every kind(collectively"costs")which in good faith you may incur or suffer in connection with or arising out of this
escrow,whether said costs arise during the performance of or subsequent to this escrow,directly or indirectly,and whether at trial,on
appeal,in administrative action,or in an arbitration.You are given a lien upon all the rights,titles and interests of the parties and all
escrow papers and other property and monies deposited into this escrow to protect your rights and to indemnify and reimburse you. If
the parties do not pay any fees,costs or expenses due you under the escrow instructions or do not pay for casts and attorneys'fees
incurred in any litigation,administrative action and/or arbitration,on demand,they each agree to pay a reasonable fee for any attorney
services which may be required to collect such fees or expenses,whether attorneys'fees are incurred before teal,at trial,on appeal or
in arbitration.
34. ALL NOTICES,DEMANDS AND INSTRUCTIONS MUST BE IN WRITING.No notice,demand,instruction,amendment,
supplement or modification of these escrow instructions shall be of any effect in this escrow until delivered in writing to you and
mutually executed by all parties.AS SET FORTH ABOVE,YOU HAVE NO DUTY TO AND SHALL NOT VERIFY THE SIGNATURES
OF ANY PARTIES OF NON-PARTIES UNLESS FURTHER WRITTEN ESCROW INSTRUCTIONS TO DO SO ARE RECEIVED AND
THE ADDITIONAL ESCROW FEES ARE DEPOSITED.Any purported oral instruction,amendment,supplement,modification,notice
or demand deposited with you by the parties or either of them shall be ineffective and invalid.You are to be concerned only with the
directives expressly set forth in the escrow instructions,supplements and amendments thereto,and are not to be concerned with nor
liable for items designated as"memorandum items"in the escrow instructions.
35. These escrow instructions may be executed in counterparts,each of which shall be deemed an original regardless of the date
(CONTINUED)
Sellers Initials: I Buyer's Initials: / 1 `,9
Date: May 27,2016 Escrow No.: 26485-KC
Page 6 of 6:Additional instructions made a part of previous pages as fully incorporated therein.
of its execution and delivery. All such counterparts together shall constitute the same document.
36. If any check submitted to you is dishonored upon presentment for payment,you are authorized to notify all parties to the
within escrow,their respective real estate broker(s)and real estate agent(s)and any other person or entity you deem in your sole
discretion necessary to notify.
37. You are authorized to accept oral instructions from the parties'real estate brokegs),real estate agent(s),Lender(s)or
Lender's agent(s)conceming the preparation of escrow instructions,amendments or supplements.However,you are not to act upon
any instructions so delivered until you have received the same in writing signed by all parties to this escrow.
38. In these escrow instructions,whether the context so requires,the masculine gender includes the feminine and/or neuter and
the singular number includes the plural.
39. The parties acknowledge and understand that you,as escrow holder,are not authorized to practice the law nor do you give
financial advice.The parties are advised to seek legal and financial counsel and advice conceming the effect of these escrow
instructions.The parties acknowledge that no representations are made by you above the legal sufficiency,legal consequences,
financial effects or tax consequences of the within escrow transaction.
40. You are authorized to destroy or otherwise dispose of any and all documents,papers,escrow instructions,correspondence
and records or other material constituting or pertaining to this escrow at any time after five(5)years from the date of:(1)the close of
escrow',(2)the date of cancellation;or(3)the date of the last activity without liability and without further notice to the parties.
41. The parties agree to release you from any and all liability of any kind or nature and to indemnify you from any loss,damages,
claims,judgments or costs of any kind or nature resulting from or related to the release or discharge of hazardous or toxic wastes on
the subject property whether it occurred in the past or present or may occur in the future which release or discharge is in violation of
law,in excess of any state and federal standards,permit requirements and/or disclosure requirements existing at this time or which
may exist at a future time.The parties represent that they made their own assessment of the condition of the subject property and
have not relied on any of your representations in making the assessment.The parties are advised to seek independent legal and
technical environmental expert advice in assessing the risks associated with potential hazardous or toxic wastes.
42. You are instructed to take notice of all information received by you on your company's facsimile machine. To close this
escmw we each agree to provide you with executed original documents when,in your sole discretion,you request their delivery to you.
43. The parties signatures on all escrow instructions and instruments pertaining to the within escrow indicates their unconditional
acceptance and approval of same and you are entitled to rely on the parties execution.
We jointly and severally,acknowledge receipt of a complete copy of the within escrow instructors and by our signatures set forth
below,acknowledge that we have read and understand and agree to the same in their entirety.
ALL PARTIES TO THIS ESCROW ACKNOWLEDGE THAT LIBERTY ESCROW INC.DOES NOT PROVIDE LEGAL ADVICE NOR
HAS IT MADE ANY INVESTIGATION,REPRESENTATIONS OR ASSURANCES WHATSOEVER REGARDING THE LEGAL
ASPECTS OR COMPLIANCE OF THIS TRANSACTION WITH ANY TAX,SECURITIES OR ANY OTHER STATE OR FEDERAL
LAWS. IT IS RECOMMENDED THAT THE PARTIES OBTAIN INDEPENDENT LEGAL COUNSEL AS TO SUCH MATTERS.
SELLERS: BUYERS:
City of Palm Springs, a chartered city organized under the Selene Palm Springs,LLC,a California Limited Liability
laws of the State of California Company
BY: By:CDI Ventures,LLC
David H.Ready,City Manager
By:
Lauri Kibby,managing member
BY:Qaiser Capital,LLC
By:
Abdul Q.Lalani, managing member
CURRENTADDRESS: CURRENTADDRESS:
3200 E.Tahquitz Canyon Way,Palm Spirngs,CA
92262
Telephone:
Telephone:
t30
LIBERTY ! ESCROW INC.
200 North Sunrise Way, Suite A Palm Springs, CA92262
(760)322-2050 FAX: (760)322-2157
AMENDED SALE ESCROW INSTRUCTIONS AND AGREEMENT Escrow No.: 26485-KC
Kristy J. Cordell Date: August 3. 2016
Certified Senior Escrow Officer
THIS ESCROW HOLDER IS LIBERTY ESCROW INC.WHICH IS LICENSED BY THE CALIFORNIA DEPARTMENT OF
BUSINESS OVERSIGHT LICENSE#9631777
Not withstanding the deposit specified in the PSA, the Buyer will hand LIBERTY ESCROW INC., on or before June 1,
2016, initial deposit in the amount of 500,000.00
Prior to close of escrow, buyer will deposit an additional amountof 1,500,000.00
Total Consideration $2,000,000.00
I/We will deliver to you any instruments which this escrow requires shall be executed by me, all of which you are instructed
to use provided that on or before(August 29, 2016), and when you are in a position to obtain a policy of title insurance
through Orange Coast Title Company, with the usual title company's exceptions, with a liability of$2,000,000.00(less
value of personal property, if any) covering property:
LEGAL DESCRIPTION ATTACHED HERETO AS EXHIBIT "A"AND MADE A PART HEREOF
PROPERTY ADDRESS: 3 lots known as APN 508-034-012, 508-034-013 and 508-034-014, Palm Springs, CA, also
referred to in these Instructions as "Property'
SHOW TITLE VESTED IN: Selene Palm Springs, LLC, a California Limited LiabilityCompany
FREE FROM ENCUMBRANCES EXCEPT:
(1) All General and special Taxes for the fiscal year 2014 and 2015, and/or supplemental taxes assessed pursuant to
the provisions of Chapter 498, Statutes of 1983 of the State of California. (Change of Ownership will affect the
taxes to be paid. A Supplemental Tax Bill will be issued and BUYER accepts all responsibility for all additional
taxes due because of said reassessment. TAX BILLS ISSUED AFTER THE CLOSE OF ESCROW SHALL BE
HANDLED DIRECTLY BETWEEN BUYERS AND SELLERS.)
(2) Covenants, conditions, restrictions, reservations, rights, rights of way, and easements, and any oil, gas, or mineral
reservations now of record, if any.
INSTRUCTIONS:
A. Buyer and Seller have entered into that certain "Purchase and Sale Agreement" as thereafter amended by six(6)
amendments, (the Agreement), which are attached hereto and made a part hereof. Liberty Escrow, Inc. has
agreed to act as escrow agent in connection with same subject only to those items for which escrow offer is
responsible, which are supplemented by these instructions-
B. The following are additional instructions to the above paragraph:
1. Pursuant to Developer's letter submitted to Owner on December 23, 2015 in compliance with Paragraph 36 of the
Purchase and Sale Agreement, the Developer's bridge lender is Beech Tree Capital.
2. Grant Deed shall include the following deed restriction:
Buyer grants Seller the right to maintain, operate, and use the property as a parking lot, at no cost to Seller, until
such time as the Buyer or Buyer's Successor commences construction as contemplated and defined in Amendment
No. 4 to the Purchase and Sale Agreement between the Grantor and Grantee executed by the parties dated
November 19, 2015. Upon the commencement of construction as defined herein, this deed restriction shall
terminate.
081A91- i
STCA4 -1:,4-
(CONTINUED) �J�En4D7ie dcna.5
Seller's Initials: / Buyer's Initials: /
Date: August 3, 2016 Escrow No.: 26485-KC
Page 2 of 7: Additional instructions made a part of previous pages as fully incorporated therein.
3. Grant Deed shall include the following deed restriction:
The Buyer and Seller agree that notwithstanding any provision to the contrary in Amendment Number 1 to the
Services Agreement between the Buyer and the Seller (the date of such Amendment No. 1 is November 19,
2015) and prior to commencement of construction on the Property, Buyer shall submit to Seller's City Council a
plan for the construction of 350 to 500 parking spaces in the Parking Facilities (as defined in the Services
Agreement as amended). This plan for parking will describe the manner in which Buyer's parking requirements
for all private improvements thereon shall be accommodated, the number and location of public parking spaces
available within the Parking Facilities in excess of the Buyer's parking requirements, and the manner in which
such Parking Facilities will be financed and maintained. In the event the City Council accepts the Buyer's plan for
parking or a modified plan accepted by the City Council and the Buyer, the Buyer, prior to issuance of a building
permit, shall deposit the $2,675,000.00 as described in Section 3 of the Services Agreement, as amended, into an
escrow account designated and approved by the City to be held by the City until such time as the funds are
required to fund all or a portion of the contributions necessary for the SCIP and the construction of the Parking
Facilities. In the event the City Council does not accept the Buyer's plan for parking for any reason, Buyer shall
pay the lump sum of$2,675,000.00 to the City prior to the issuance of any building permit on the Property, which
the City may use for any city purpose, and Buyer shall be relieved of any obligation to construct parking in excess
of parking as may be required for all private improvements on the Property. Buyer's obligations herein, which
accrue solely to the named Buyer, or an assignee of the Buyer approved by the Seller (whose approval shall not
be unreasonably withheld), under this restriction, shall be deemed fully satisfied through Buyer's or Buyer's
approved assignee's performance of its obligations pursuant to the Services Agreement, as amended, between
the Buyer and the Seller. Upon completion of, and issuance of an occupancy permit for, a parking structure
pursuant to the Services Agreement, as amended, this restriction shall terminate. Any other successor of Buyer
in the property, including without limitation any successor following a default of Buyer under the Purchase and
Sale Agreement or the Services Agreement, shall pay to the City the amount of Two Million, Six Hundred and
Seventy Five Thousand Dollars ($2,675,000.00), prior to the issuance of a building permit on the property, and
such amount shall be increased annually by increases in the consumer price index for all urban consumers for the
Los Angeles-Riverside-Orange County Standard Metropolitan Statistical Area as reported by the United States
Bureau of Labor Statistics, or any successor to such index.
C. Buyer and Seller authorize and instruct Escrow Holder to accept and act on signature(s)throughout this escrow in
the form of photo copies, e-mail or faxes, as defined in this Escrow as though they were original signature(s), to
open escrow and for other purposes.
D. ASSEMBLY BILL 512: "GOOD FUNDS LAWS". AB 512 enacts a new Section 12413.1 to the State of California
Insurance Code that regulates real estate escrow disbursements by title insurance companies, controlled escrows
and underwritten title companies. The Bill requires that checks be deposited by the title company prior to escrow
disbursement.
THE NEW LAW ESTABLISHED A THREE-TIER SYSTEM TO DETERMINE WHEN DISBURSEMENT MAY
OCCUR,
1) Cash and "Wired Funds" may be disbursed on the same day asdeposited.
2) Teller's checks, cashier's checks and certified checks may be disbursed on the first business day following the
day of deposit. (A teller's check is defined as a check drawn by an insured financial institution against another
insured financial institution.)
3) Personal checks, corporate checks and drafts received from title companies (including escrow trust checks) may
be disbursed on the day when the item must be made available for withdrawal by depositors under Regulation CC
adopted by the Federal Reserve Board of Governors. Until September 1, 1990, the hold period on these items
is three (3) business days following the date of deposit of local checks and seven (7) business days following the
date of deposit of non-local checks, after September 1, 1990, these hold periods will be reduced to two(2)
business days following the date of deposit for local checks and five(5) business days following date of deposit for
non-local checks.
Please prepare for delayed disbursement of funds to all recipients at the close of escrow.
All parties are aware that NO interest will be paid to recipients of funds from Liberty Escrow Inc. as a result of this
delay as outlined under Senate Bill 1550.
NO ESCROW WILL RECORD UNTIL THE ABOVE REQUIREMENTS HAVE BEEN MET. NO EXCEPTIONS!!
E. CLOSING FUNDS: Each party acknowledges that the close of escrow is conditioned on check clearances.
Funds to close must be in the form of a Cashier's Check drawn on a bank with clearing house in the State of
California OR be wire transfer to Liberty Escrow Inc. Trust Account two (2)days prior to recording of documents.
ALL FINAL FUNDS IN EXCESS OF$100,000.00 MUST BE WIRE TRANSFERRED.
(CONTINUED)
Seller's Initials: / Buyer's Initials: /
Date: August 3, 2016 Escrow No.: 26485-KC
Page 3 of 7: Additional instructions made a part of previous pages as fully incorporated therein.
If you wish to wire transfer US funds to Liberty Escrow Inc., please use the following format:
WIRE TRANSFER INSTRUCTIONS
LIBERTY ESCROW INC.
Receiving Bank: OPUS BANK
Specialty Deposits
19900 MacArthur Blvd., 12th Floor
Irvine, CA 92612
Bank Routing Number: 122239270
Account Name: Liberty Escrow Inc.
Account Number: 10932929
Reference: Escrow No. 26485-KC
Attn: Kristy J. Cordell
THE WIRE TEXT MUST BE EXACTLY AS INDICATED ABOVE. ANY EXTRANEOUS INFORMATION MAY
CAUSE UNNECESSARY DELAYS IN CONFIRMING THE RECEIPT OF FUNDS.
F. PRORATIONS: Prorate as of Close of Escrow
Real Property taxes based on latest tax bill or on amount furnished by title company.
(CONTINUED)
Seller's Initials: / Buyer's Initials: /
Date: August 3, 2016 Escrow No.: 26485-KC
Page 4 of 7. Additional instructions made a part of previous pages as fully incorporated
ADDITIONAL ESCROW INSTRUCTIONS AND CONDITIONS
1. You are instructed to deposit all funds received by you with any state or national bank, state or federal savings bank,or state
of federal savings and loan association, in trust account in the name of escrow holder,without any liability for payment of interest. The
funds may be withdrawn by you and disbursed according to the instructions of the parties.All deposits made by personal check,
cashier's check, certified check or deposit other than cash or wire transfer are subject to clearance and payment by financial institution
on which drawn. All disbursements are to be made by check or escrow holder form the trust account. Neither you nor any of your
employees will identify any payee or guarantee signatures of any person or entity at any financial institution. Funds deposited into
escrow in the form of a check,draft,or similar instrument will be identified as collected funds when the escrow holder's financial
institution confirms that the funds are available for disbursement.
2. Your duty is to act as escrow holder only and does not commence and escrow shall not be deemed opened until mutual
escrow instructions signed by all parties are received by you. Until mutually executed escrow instructions are received,either party
may unilaterally revoke these instructions by written request delivered to you and may withdraw any funds, instruments, documents or
items previously handed to you.
3. All prorations and adjustments are to be made on the basis of a thirty(30)day month unless otherwise instructed in writing by
all parties. For proration purposes, the Buyer will have ownership of the real property which is the subject of this escrow for the entire
day, regardless of the hour of recording.The"close of escrow"with reference to prorations,adjustments and all purposes in this
escrow shall be the day the instruments of conveyance are recorded or filed with the county recorder.
4. Any funds disbursed during or on the close of escrow will be issued jointly to the parties designated as payees unless you are
instructed otherwise in writing by all designated payees. The funds representing loan and/or sale proceeds will be disbursed jointly to
all persons who were the record owners of the real property which is the subject of the escrow.All disbursements of funds and/or
delivery of other documents or instruments concerning this escrow will be mailed to the entitled parties by regular first-class mail,
postage prepaid, at their respective addresses shown on file. However, at your discretion,you may send funds and/or other
instruments or documents by certified or registered mail,federal express, messenger or facsimile machine, in which case the party for
whom the delivery was made agrees to pay the costs.The provisions of this paragraph include, but are not limited to, request for
demand statements, requests for beneficiary statements, request for homeowners'association statements or any other requests as
you may deem necessary for the timely closing of this escrow.You are to instruct the county recorder to mail recorded documents to
the entitled parties at their respective addresses.You are to instruct the title company to mail the title policy(s)to the Lender(s)or
Buyer(s)as appropriate.
5. In addition to other costs and charges set forth in escrow instructions, Seller agrees to pay on demand, whether or not this
escrow closes,all expenses and charges incurred by you on Seller's behalf, including, but not limited to, charges for preliminary title
reports,title commitments, policies of title insurance, beneficiary statements,beneficiary demands, offset statements, documentary
transfer tax stamps, preparation of, notarizing and recording of documents necessary in Seller's behalf, one-half(112)of sub-escrow
fee, Seller's escrow fee and other costs as charged. In addition to the other costs and charges set forth in these escrow instructions,
Buyer agrees to pay on demand,whether or not this escrow closes, all expenses and charges incurred by you on Buyer's behalf,
including, but not limited to, recording fees, preparation of notarizing and recording trust deed(s)and other documents on Buyer's
behalf, new loan charges, existing loan assumption transfer fees,one-half(1/2)of sub-escrow fees, Lender's policy of title insurance,
fire insurance premiums, Buyer's escrow fee and other costs as charged.
6. NOTWITHSTANDING ANY PROVISIONS TO THE CONTRARY CONTAINED IN THESE ESCROW INSTRUCTIONS OR
SUPPLEMENTS OR AMENDMENTS, ESCROW HOLDER SHALL NOT BE RESPONSIBLE FOR THE SUFFICIENCY, VALIDITY OR
CORRECTNESS OF ANY SIGNATURE OF ANY PRINCIPAL TO THIS ESCROW OR ANY THIRD PARTY TO THIS ESCROW, NOR
FOR THE SUFFICIENCY OR CORRECTNESS AS TO FORM, MANNER OF EXECUTION OR VALIDITY OF ANY DOCUMENTS
DEPOSITED IN THIS ESCROW, NOR AS TO THE IDENTITY, AUTHORITY, OR RIGHT OF ANY PERSONS EXECUTING THE
SAME, EITHER AS TO DOCUMENTS OF RECORD OR THOSE HANDLED IN THIS ESCROW.SHOULD THE PARTIES DESIRE
THAT YOU VERIFY THE SIGNATURES ON INSTRUCTIONS RECEIVED BY YOU,THE PARTY(IES)WITHOUT FURTHER
INSTRUCTIONS AUTHORIZED THE PAYMENT OF AN ESCROW FEE COMPUTED AT TWO TIMES YOUR REGULAR ESCROW
FEE AND WILL DELIVER SEPARATE WRITTEN ESCROW INSTRUCTIONS SPECIFICALLY INSTRUCTING YOU TO DO SO.
7. You shall not be responsible for the following: (1)the sufficiency or correctness as to form, manner of execution or validity of
any documents deposited in this escrow; (2)the identity, authority,or right of any person executing the same,either as to documents
of record of those handled in this escrow; or(3)the failure of any party to comply with any of the provisions of any agreement,contract
or other instrument filed or deposited in this escrow or referred to in these escrow instructions. Your duties shall be limited to the
safekeeping of money and documents received by you as escrow holder and for the disposition in compliance with the written
instructions accepted by you in this escrow.You shall not be required to take any action regarding the collection, maturity, or apparent
outlaw of any obligations deposited with you unless otherwise instructed in writing.
8. You are not to be held responsible in any way whatsoever for any personal property tax which may be assessed against any
former or present owner of the subject property described in these escrow instructions, nor for the corporation or license tax of any
corporation as a former or present owner.
9. If it is necessary, proper or convenient for the consummation of this escrow,you are authorized to deposit or have deposited
funds or documents,or both, handed you under these escrow instructions with any duly authorized sub-escrow agent, including, but
not limited to, any bank,trust company, title insurance company,title company, savings and loan association, or licensed escrow
agent, subject to your order at or before close of escrow in connection with closing this escrow.Any such deposit shall be deemed a
deposit under the meaning of these escrow instructions.
10. The parties to this escrow have satisfied themselves outside of escrow that the transaction covered by this escrow is not in
violation of the Subdivision Map Act or any law regulating land division,zoning ordinances or building restrictions which may affect the
land or improvements that are the subject of this escrow.You,as escrow holder, are relieved of all responsibility and liability in
connection with such laws, ordinances, restrictions or regulations and are not to be concerned with any of their enforcement.
11. If any form of Purchase Agreement or amendment or supplement(collectively"Purchase Agreement")is deposited in this
escrow, it is understood that such document shall be effective only as between the parties signing the Purchase Agreement.You,as
escrow holder, are not to be concerned with the terms of any Purchase Agreement and are relieved of all responsibility and liability for
the enforcement of its terms. Your only duty is to comply with the instructions set forth in the escrow instructions. You are not
responsible for interpreting or acting on any provision of any Purchase Agreement on which these escrow instructions may be
based and you shall not rely on any knowledge or understanding you may have of any such Purchase Agreement in ascertaining or
performing your duties as escrow holder. In connection with any loan transaction, you are authorized to deliver a copy of any
Date: August 3, 2016 Escrow No.: 26485-KC
Page 5 of 7. Additional instructions made a part of previous pages as fully incorporated
Purchase Agreement, supplement or amendment and a copy of all escrow instructions, supplements or amendments to the Lender.
12. You are not to be concerned with the giving of any disclosures required by federal or state law, including, but not limited
to, Real Estate Settlement Procedures Act, Regulation Z-Truth-In-Lending, condition of the subject property or other warnings, or
any other warranties, express or implied.
13. Except as set forth in Paragraph 14 below,you shall not be responsible and you are released from and shall have no liability,
obligation or responsibility with respect to withholding of funds under§1445 of the Internal Revenue Code of 1954, as amended,
commonly know as the Foreign Investment in Real Property Tax Act("FIRPTA")or the California FIRPTA under§18805,et seq.of the
Califomia Revenue&Taxation Code("CAL-FIRPTA"). Advice about FIRPTA or CAL-FIRPTA its requirements, a determination
whether the Seller/transferor is a foreign person, as defined,or obtaining a non-foreign affidavit or exemption from withholding or
other information concerning compliance or non-compliance will not be given to the parties by the escrow holder.The parties are
advised to seek independent legal,financial and tax counsel from their respective legal, financial and tax advisors.
14. The parties are aware that California law effective January 1, 1991 requires you to withhold a sum equal to 3 1/3% of the sale
price under certain conditions where Seller does not reside in the State of California or funds are transmitted outside of California. The
parties agree to prepare and deposit such other and further documents or instruments as are necessary for you to comply with this
instruction and California state law.The parties herewith acknowledge receipt of the Notification of the California Franchise Tax Board
embodying the California state law commonly known as CAL-FIRPTA as stated in California Revenue and Taxation Code§§18805
and 26131.
15. You are authorized to deliver copies of all escrow instructions, supplements and amendments, estimated and final
closing statements, preliminary title reports, and notices of cancellation, if any,to the real estate broker(s), real estate sales
agent(s), Lender(s), Lender's agent(s)and/or attorneys(s)for the parties, upon the parties'oral or written request. You shall not
incur any liability to the parties for delivery of the copies.
16. You shall make no physical inspection of the real property or personal property described in any instrument deposited in
or which is the subject of this escrow. You have made no representations or warranties concerning any such real property or
personal property and are not to be concerned with nor liable for the conditions of real property or personal property.
17. The parties authorize the recordation of any instrument delivered through this escrow if necessary or proper for the issuance
of the required policy of title insurance or for the closing of this escrow. Funds, instructions or instruments received in this escrow
may be delivered to,or deposited with any title insurance company of title company to comply with the terms and conditions of this
escrow.
18. You are authorized to deduct from Seller's net proceeds or Buyer's net proceeds any amount which either Seller or Buyer
may owe you in any other matter or transaction.You are authorized to charge and the parties agree to pay additional escrow fees for
extraordinary services not within the range of customary escrow processing, including, but not limited to,the verification of signatories
to escrow instructions.
19. You are to use your usual document forms or the usual fors of any title insurance company or title company and in
our instructions insert dates and terms on the instruments if incomplete when executed.
20. If the date by which Buyer's or Seller's performances are due shall be other than your regular business day,
such performances shall be due on your next succeeding business day.
21. You shall conduct no lien or title search of personal property regarding the sale or transfer of any personal property through
this escrow.Should the party(ies)desire that you conduct a lien or title search of personal property,the party(ies)requesting the
same shall deliver separate and specific written escrow instructions to you along with an agreement to pay your additional escrow
fees.
22. You shall not be responsible in any way whatsoever nor are you to be concerned with any question of usury in any loan
or encumbrance,whether new or of record,which may arise during the processing of this escrow.
23. The parties agree to deliver to you all documents, instruments, escrow instructions and funds required to process and
close this escrow in accordance with its terms.
24. You are instructed to provide title to the subject real property in the condition identified in the escrow instructions by the
parties.You are not responsible for the contents or accuracy of any beneficiary demands and/or beneficiary statements delivered to
you by the existing lienholder.You are not required to submit any such beneficiary statement and/or beneficiary demand to the
parties for approval before the close of escrow unless expressly instructed to do so in writing. Should the party(ies)desire to pre-
approve any such beneficiary statement and/or beneficiary demand,the party(ies)requesting the same shall deliver separate and
specific written escrow instructions to you.
25. You are not to be responsible in any way whatsoever nor to be concerned with the terms of any new loan or the content of
any loan documents obtained by any party in connection with this escrow except to order such loan documents into the escrow file,
transmit the loan documents to Buyer for execution and transmit the executed loan documents to Lender.The parties understand
and agree that you are not involved nor concerned with the approval and/or processing of any loan or the contents and effect of loan
documents prepared by a Lender.
26. The parties agree to complete and deliver to you a Statement of Information as required by the title insurance company or
title company.
27. The Federal Tax Reform Act of 1986, as amended, and the California Revenue&Taxation Code, require certain
transactions to be reported to the Internal Revenue Service and the California State Franchise Tax Board. In those transactions Seller
will furnish a correct tax identification number to you so you can report this transaction as required by law. Seller understands that
Seller may be subject to civil or criminal penalties for failure to do so.
28. The parties expressly indemnify and hold you harmless against third-party claims for any fees, costs or expenses where
you have acted in good faith,with reasonable care and prudence and/or in compliance with these escrow instructions.
29. The parties agree that you have the responsibilities of an escrow holder only and there are no other legal relationships
established in the terms and conditions of the escrow instructions. In connection with this escrow: (1)you shall have no duty or
responsibility of notifying any of the parties to this escrow of any sale, resale, loan,exchange or other transaction involving any of the
subject real property or personal property; (2)you shall have no responsibility or duty to disclose any benefit, including, but not limited
to financial gain, realized by any person, firm or corporation involving any of the subject real property or personal property; and(3)
Date: August 3, 2016 Escrow No.: 26485-KC
Page 6 of 7. Additional instructions made a part of previous pages as fully incorporated
you shall have no responsibility or duty to disclose any profit realized by any person,firm or corporation including, but not limited to,
any real estate broker, real estate sales agent and/or a party to any other escrow, in connection therewith, although such other
transaction may be handled by you in this escrow or in another escrow transaction. If, however,you are instructed in writing by any
party, Lender or other entitled person to disclose any sale, resale, loan, exchange or other transaction involving any of the subject
real property or personal property or any profit realized by any person,firm or corporation to any party to this escrow,you shall do so
without incurring any liability to any party.You shall not be liable for any of your acts or omissions done in good faith nor for any
claims,demands, losses or damages made or suffered by any party to this escrow, excepting such as may arise through or be
caused by you willful neglect or gross misconduct.
30. Buyer acknowledges that pursuant to the California Revenue&Taxation Code a Change of Ownership form is required by
the county recorder to be completed and affixed to any documents submitted for recording which evidence a conveyance of title. The
Change of Ownership forn shall be furnished to Buyer by you for Buyer's completion and execution. Buyer is aware that if Buyer does
not complete the form in full, sign and return it to you before closing,a penalty will be assessed by the county recorder. If the Change
of Ownership form is not filed after the close of escrow within the time limits set forth by the county recorder, severe additional
penalties will be assessed against the Buyer. FOR INFORMATION AND ASSISTANCE IN COMPLETING THE CHANGE OF
OWNERSHIP FORM, BUYER MAY CONTACT THE COUNTY RECORDER AND ASSESSORS OFFICES IN THE COUNTY IN
WHICH THE SUBJECT PROPERTY IS LOCATED.
31. Notwithstanding any other provisions in these escrow instructions and in addition to other fees and cost to which you may
be entitled,the parties,jointly and severally,agree that if this escrow is not consummated within ninety(90)days of the date set for
closing,you are instructed to, and without further instructions,withhold your escrow hold open fee of$50.00 per month from the
funds on deposit with you regardless of who deposited such funds.The parties,jointly and severally, further agree that if you, for any
reason, required to hold funds after close of escrow,you are instructed to,and without further instructions,withhold an escrow fee of
$50.00 per month from the funds on deposit with you regardless of who deposited such funds.The parties irrevocably instruct you to
automatically cancel this file without further instructions when all funds on deposit have been disbursed.
32. Your escrow holder agency shall terminate six(6)months following date last set for close of escrow and shall be subject to
earlier termination by receipt by you of mutually executed cancellation instructions. If this escrow was not closed or cancelled within
the described six(6) month period,you shall have no further obligation as escrow holder except to disburse funds and documents
pursuant to written escrow instructions and to interplead or otherwise dispose of funds and documents in accordance with a validly
issued and validly served order from a court of competent jurisdiction. If the conditions of this escrow have not been complied with at
the expiration date in these escrow instructions, you are instructed to complete the conditions at the earliest possible date, unless
Buyer or Seller have made written demand upon you for the return of the funds and/or instruments deposited by Buyer or Seller
and/or for cancellation of this escrow. Should demands be made upon you, you may withhold and stop all further proceedings in this
escrow without liability for interest on funds held or for damages until mutual cancellation instructions signed by all parties shall have
been deposited with you.The parties,jointly and severally, agree that if this escrow cancels or is otherwise terminated and not closed,
the parties shall pay for any cost and expenses which you have incurred or have become obligated for under these escrow
instructions, including, but not limited to,attorneys'tees, arbitration fees and costs and reasonable escrow fees for the services
rendered by you,the parties agree that such cost and expenses shall be paid and deposited in escrow before any cancellation or
other termination of this escrow is effective. The parties agree that said charges for expenses, costs, and fees may be apportioned
between Buyer and Seller in a manner which, in your sole discretion, you consider equitable, and that your decision will be binding
and conclusive upon the parties. Upon receipt of mutual cancellation instructions of a final order orjudgement of a court of competent
jurisdiction with accompanying writs of execution, levies or garnishments, you are instructed to disburse the escrow funds and
instruments in accordance with such cancellation instructions,order or judgment and accompanying writ and this escrow shall,without
further notice, be considered terminated and cancelled.
33. The parties shall cooperate with you in carrying out the escrow instruction they deposit with you and completing this escrow.
The parties shall deposit into escrow, upon request, any additional funds, instruments, documents, instructions, authorizations, or
other items that are reasonably necessary to enable you to comply with demands made on you by third parties,to secure policies of
title insurance, or to otherwise carry out the terms of their instructions and close this escrow. If conflicting demands or notices are
made or served upon you or any controversy arises between the parties or with any third person arising out of or relating to this
escrow, you shall have the absolute right to withhold and stop all further proceedings in,and in performance of, this escrow until you
receive written notification satisfactory to you of the settlement of the controversy by written agreement of the parties, or by the final
order or judgement of a court of competent jurisdiction.All of the parties to this escrow,jointly and severally, promise to pay promptly
on demand, as well as to indemnify you and to hold you harmless from and against all administrative governmental investigation,
audit and legal fees, litigation and interpleader costs, damages,judgments,attorneys'fees,arbitration costs and fees,expenses,
obligations and liabilities of every kind (collectively"costs")which in good faith you may incur or suffer in connection with or arising out
of this escrow,whether said costs arise during the performance of or subsequent to this escrow, directly or indirectly, and whether at
trial,on appeal, in administrative action, or in an arbitration.You are given a lien upon all the rights,titles and interests of the parties
and all escrow papers and other property and monies deposited into this escrow to protect your rights and to indemnify and reimburse
you. If the parties do not pay any fees, costs or expenses due you under the escrow instructions or do not pay for costs and
attorneys'fees incurred in any litigation, administrative action and/or arbitration, on demand,they each agree to pay a reasonable fee
for any attorney services which may be required to collect such fees or expenses,whether attorneys'fees are incurred before trial, at
trial,on appeal or in arbitration.
34. ALL NOTICES, DEMANDS AND INSTRUCTIONS MUST BE IN WRITING. No notice, demand, instruction,amendment,
supplement or modification of these escrow instructions shall be of any effect in this escrow until delivered in writing to you and
mutually executed by all parties.AS SET FORTH ABOVE,YOU HAVE NO DUTY TO AND SHALL NOT VERIFY THE SIGNATURES
OF ANY PARTIES OF NON-PARTIES UNLESS FURTHER WRITTEN ESCROW INSTRUCTIONS TO DO SO ARE RECEIVED
AND THE ADDITIONAL ESCROW FEES ARE DEPOSITED.Any purported oral instruction, amendment,supplement, modification,
notice or demand deposited with you by the parties or either of them shall be ineffective and invalid. You are to be concerned only
with the directives expressly set forth in the escrow instructions, supplements and amendments thereto, and are not to be concerned
with nor liable for items designated as"memorandum items"in the escrow instructions.
35. These escrow instructions may be executed in counterparts, each of which shall be deemed an original regardless of the date
of its execution and delivery. All such counterparts together shall constitute the same document.
36. If any check submitted to you is dishonored upon presentment for payment,you are authorized to notify all parties to the
within escrow,their respective real estate broker(s)and real estate agent(s)and any other person or entity you deem in your sole
discretion necessary to notify.
37. You are authorized to accept oral instructions from the parties'real estate broker(s), real estate agent(s), Lenders)or
Lender's agent(s)concerning the preparation of escrow instructions, amendments or supplements. However,you are not to act upon
any instructions so delivered until you have received the same in writing signed by all parties to this escrow.
38. In these escrow instructions,whether the context so requires,the masculine gender includes the feminine and/or neuter and
the singular number includes the plural.
Date: August 3, 2016 Escrow No.: 26485-KC
Page 7 of 7. Additional instructions made a part of previous pages as fully incorporated
39. The parties acknowledge and understand that you,as escrow holder, are not authorized to practice the law nor do you give
financial advice.The parties are advised to seek legal and financial counsel and advice concerning the effect of these escrow
instructions.The parties acknowledge that no representations are made by you above the legal sufficiency, legal consequences,
financial effects or tax consequences of the within escrow transaction.
40. You are authorized to destroy or otherwise dispose of any and all documents, papers, escrow instructions, correspondence
and records or other material constituting or pertaining to this escrow at any time after five(5)years from the date of: (1)the close of
escrow;(2)the date of cancellation; or(3)the date of the last activity without liability and without further notice to the parties.
41. The parties agree to release you from any and all liability of any kind or nature and to indemnify you from any loss,damages,
claims,judgments or costs of any kind or nature resulting from or related to the release or discharge of hazardous or toxic wastes on
the subject property whether it occurred in the past or present or may occur in the future which release or discharge is in violation of
law, in excess of any state and federal standards, permit requirements and/or disclosure requirements existing at this time or which
may exist at a future time.The parties represent that they made their own assessment of the condition of the subject property and
have not relied on any of your representations in making the assessment.The parties are advised to seek independent legal and
technical environmental expert advice in assessing the risks associated with potential hazardous or toxic wastes.
42. You are instructed to take notice of all information received by you on your company's facsimile machine. To close this
escrow we each agree to provide you with executed original documents when, in your sole discretion,you request their delivery to you.
43. The parties signatures on all escrow instructions and instruments pertaining to the within escrow indicates their unconditional
acceptance and approval of same and you are entitled to rely on the parties execution.
We jointly and severally, acknowledge receipt of a complete copy of the within escrow instructions and by our signatures set forth
below, acknowledge that we have read and understand and agree to the same in their entirety.
ALL PARTIES TO THIS ESCROW ACKNOWLEDGE THAT LIBERTY ESCROW INC. DOES NOT PROVIDE LEGAL ADVICE NOR
HAS IT MADE ANY INVESTIGATION, REPRESENTATIONS OR ASSURANCES WHATSOEVER REGARDING THE LEGAL
ASPECTS OR COMPLIANCE OF THIS TRANSACTION WITH ANY TAX, SECURITIES OR ANY OTHER STATE OR FEDERAL
LAWS. IT IS RECOMMENDED THAT THE PARTIES OBTAIN INDEPENDENT LEGAL COUNSEL AS TO SUCH MATTERS.
SELLERS: BUYERS:
City of Palm Springs, a chartered city organized underthe Selene Palm Springs, LLC, a California Limited Liability
laws of the State of California Company
BY: By: CDI Ventures, LLC
David H. Ready, City Manager
By:
Lauri Kibby, managing member
BY: Qaiser Capital, LLC
By:
Abdul Q. Lalani, managing member
CURRENT ADDRESS: CURRENT ADDRESS:
3200 E. Tahquitz Canyon Way, Palm Spirngs,CA
92262
Telephone:
Telephone: