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HomeMy WebLinkAbout3/6/2013 - AGREEMENTS (4)AMENDMENT NO. 2 TO SERVICES AGREEMENT (SELENE) This Amendment No. 2 to the Services Agreement (the "Amendment"), is made and entered into this day of Apn'l , 201^, by and between the City of Palm Springs, California, a California Charter City and municipal corporation, ("City"), and Selene Palm Springs, LLC, a California limited liability company, the successor in interest to Praetor Investments, LLC, a California limited liability company, and CDI Ventures, LLC, a California limited liability company, ("Developer"). RECITALS A. City and Developer entered into that certain Services Agreement dated March 6, 2013, identified as Agreement No. 6329, (the "Services Agreement"), 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 developing and maintaining the Dolce Hotel Project, (the "Hotel"), a First Class Superior Hotel (Four+ stars), on a 7.8 acre parcel owned by the City located at the northeast corner of Calle Alvarado and East Amado Road (the "City Property"). B. City and Developer also entered into that certain related Purchase and Sale Agreement dated March 6, 2013, also identified as Agreement No. 6329, (the "Purchase and Sale Agreement"), to accommodate the conveyance of the City Property to Developer for purposes of constructing the Hotel. C. Pursuant to Amendment No. 1 to the Service Agreement approved by City on November 4, 2015, Developer agreed to pay City the amount of $2,675,000 for the unamortized parking improvements necessary or desirable for the construction of at least 350 public 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 the Developer and the construction of the Hotel (the "Parking Fee"). D. Pursuant to Amendment No. 1 to the Service Agreement approved by City on November 4, 2015, City and Developer acknowledged a desire to replace the existing public parking spaces within a public/private parking structure and related parking facilities ("Parking Facilities") that Developer will construct and maintain in conjunction with the Hotel. E. Pursuant to Amendment No. 1 to the Service Agreement approved by City on November 4, 2015, City and Developer anticipated that the Parking Facilities would be funded through the Statewide Community Infrastructure Program ("SCIP"), and that prior to or upon the issuance of a building permit. Developer will deposited the Parking Fee 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 oirv Amendment No. 2 ORIGINAL DlL) Service Agreement Dream Hotel AND/OR AGREEMENT necessary for the SCIP and the construction of the Parking Facilities, and to be used solely for funding replacement public parking. F. On August 26, 2016, City and Developer completed the real property transaction consummated by the Purchase and Sale Agreement, and City conveyed fee title interest in the City Property to Developer pursuant to that certain Grant Deed recorded as Document No. 2016-0367646 (the "Grant Deed"). G. In accordance with the final escrow instructions and the restriction noted on the Grant Deed, City and Developer coordinated on review of a plan for the Parking Facilities, including the manner in which such public/private Parking Facilities would be financed and maintained. Further, the final escrow instructions and the restriction noted on the Grant Deed modified the provisions of Section 3 of the Services Agreement amended by Amendment No. 1 thereto, and requires Developer's payment of the Parking Fee to the City in one lump sum to the City prior to the issuance of any building permit on the City Property, which the City may use for any city purpose. H. On April 5, 2017, the City Council determined not to participate in a joint public/private Parking Facility, thereby eliminating the need for the Parking Fee to be paid 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 contributions necessary for the SCIP and the construction of the Parking Facilities. I. This Amendment will modify Section 3 of the Service Agreement to reflect the City's decision not to participate in a joint public/private Parking Facility, and to allow for payment of the Parking Fee subsequent to the City's issuance of building permits. NOW, THEREFORE, in consideration of the foregoing Recitals and promises and covenants contained in this Amendment, the City and Developer as follows: SECTION 1. The foregoing Recitals are true and correct, and incorporated herein by this reference as a material inducement upon which the parties relied in their decision to agree upon and execute this Amendment. SECTION 2. Section 3 of the Service Agreement is amended in its entirety to read: 3. Existing Improvements and Entitlement Rights: a. Developer shall pay City the amount of $2,675,000.00 as the cost to replace the 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 Dream Hotel Project, or for City to use, in an exercise of City's sole and absolute discretion, in the design, construction, maintenance or repair of any public facility or improvement (the "Parking Fee"). The Parking Fee is otherwise due and payable upon issuance of a building permit to Developer for construction of the Dream Hotel Project, Amendment No. 2 Service Agreement Dream Hotel Page 2 which payment may be deferred pursuant to the conditions specified herein this Section 3. b. City reserves the right, but not the obligation, to utilize the Parking Fee towards the City's costs to replace the existing public parking spaces on the City Property, and may alternatively use the Parking Fee for any other governmental purpose in its sole discretion. To the extent City utilizes the Parking Fee towards the City's costs to replace the existing public parking spaces on the City Property, the Parties acknowledge that it is the Developer's intent to reimburse itself for payment of the Parking Fee through participation in the SCIP, with all such eligible costs in the City's use of the Parking Fee to be financed through the SCIP. c. As a condition precedent to City's issuance of a building permit to Developer, Developer shall deliver a commitment letter from its financial lender, in a form acceptable to the City Attorney, acknowledging that the Parking Fee is funded and otherwise set aside, and is available for payment to the City at any time requested by the City in its sole discretion. Following City's issuance of a building permit for the Dream Hotel Project, Developer hereby agrees to increase the Parking Fee by an annualized interest equivalent to the current rate of the Local Agency Investment Fund ("LAIF") or two percent (2%), whichever is lower, until the Parking Fee is paid in full to the City. Developer acknowledges and agrees that City shall have full discretion to call for payment of a portion of, or the full amount of, the Parking Fee, when it so requires. d. In accordance with the provisions of the Purchase and Sale Agreement, as amended and executed by the Parties, Developer is obligated to commence with construction of the Dream Hotel Project, and continue with continuous construction by dates certain. In the event Developer does not commence with construction of the "core and shell" of the Dream Hotel Project by December 31, 2018, as stipulated in the Purchase and Sale Agreement, payment of the Parking Fee shall be due and payable to City in the full amount otherwise owing, inclusive of applicable interest, less any prior payments of portions of the Parking Fee made to City. In the event Developer does not otherwise pay the Parking Fee to City within thirty (30) days written notice thereof, the amount owed to the City shall constitute a lien payable to the City, and City reserves its rights to recover the Parking Fee in accordance with applicable law. e. In accordance with the Sections 19 of the Purchase and Sale Agreement, as originally amended by Amendment No. 4 and approved by City on November 4, 2015, and subsequently amended in Amendment No. 8 approved concurrently herewith (the "PSA"), the City and Developer acknowledged and agreed to various scenarios pursuant to which the City has the right to repurchase the Property. In the event that the City exercises either Repurchase Option A or Repurchase Option B as defined in Section 19, and Developer has not fully paid the Parking Fee to City pursuant to this Section 3 of the Services Agreement, the Parties agree that the Purchase Price payable by City to Developer pursuant to either Repurchase Option A or Repurchase Option B Amendment No. 2 Service Agreement Dream Hotel Page 3 shall be reduced by the amount of the Parking Fee otherwise owing to the City at that time. SECTION 3. Except as expressly provided above, all other terms and conditions of the Service Agreement, as amended, shall remain unchanged and in full force and effect. IN WITNESS WHEREOF, the Parties have executed this Amendment and acknowledge October 18. 2017, as the effective date of this Amendment. "City" City of Palm Springs Date: David H. Reaj City Manager APPROVED AS TO FORM Edward Z. Kotkin City Attorney W^^APPROVED BY OTY COUNCIL Date:v//z>/// ATTEST /I -7 I/H feitliloori Halt ,UHcInterim City Clerk ^ ^ "Developer" Selene Palm Springs, LLC, a California limited liability company Kibby for CDI ye^tures, LLC Managing Membei Date:By: Abdul Q. Lalani for Qaiser Capital, LLC Managing Member Amendment No. 2 Service Agreement Dream Hotel Page 4 shall be reduced by the amount of the Parking Fee otherwise owing to the City at that time. SECTION 3. Except as expressly provided above, all other terms and conditions of the Service Agreement, as amended, shall remain unchanged and in full force and effect. IN WITNESS WHEREOF, the Parties have executed this Amendment and acknowledge October 18,2017, as the effective date of this Amendment. "City" City of Palm Springs Date: APPROVED AS TO FORM By: in David H. Ready City Manager ATTEST By: in Edward Z. Kotkin City Attorney Date By: 6^ Kathteen-Hart -Irrtefim City Clerk ' ^ "Developer" Selene Palm Springs, LLC, a California limited liability company Kibby for CDI Yi^ures, LLC Managing Membei Date:Bv: l)fY)dJLJl Abdul Q. Lalani for Qaiser Capital, LLC Managing Member Amendment No. 2 Service Agreement Dream Hotel Page 4 CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT CIVIL CODE §1189 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 Riverside ) On April 10, 2018 before me, Enrique Solis, Notary Public Date personally appeared Lauri Kibby Here Insert Name and Title of the Officer Name(s) of Signer(s) 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. JagoBBiioiDiBaaioaiDoigDioaBOBBaDBOBaik ENRIQUE SOLIS COMM. #2166373 NOTARY PUBLIC - CALIFORNIA RIVERSIDE COUNTY *iBI My Commission Exmroi 10/27/2020 llSlISIBBIBfllBai^lJBIiaBIBSs eaBBBBir I certify under PENALPr' OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official se Signature ignature of Notary Public Place Notary Seal Above OPTIONAL Though this section is optional, completing this information can deter alteration of the document or fraudulent reattachment of this form to an unintended document Description of Attached Document Title or Type of Document: AMENDMENT NO. 2 TO SERVICES AGREEMENT (SELENE) Document Date: Number of Pages: Signer(s) Other Than Named Above: Capacity(ies) Claimed by Signer(s) Signer's Name:Signer's Name: x Corporate Officer — Title(s): Managpr □ Partner — □ Limited □ General □ Individual [ I Attorney in Fact n Trustee L ! Guardian or Conservator □ Other: Signer Is Representing: CDI ventures, llc rj Corporate Officer — Title(s): L J Partner — f ! Limited I I General ! ] Individual □ Attorney in Fact r i Trustee U Guardian or Conservator j Other: Signer Is Representing: ©2015 National Notary Association • www.NationalNotary.org • 1-800-US NOTARY (1-800-876-6827) Item #5907 State of Texas County of Bexar Before me , on this day personally appeared Abdul Q. Lalani, known to me to be the person whose name is subscribed to the foregoing instrument and acknowledged to me that he executed the same for the purpose consideration therein expressed. Given under my hand and seal of office this. (javof 2y() JENNIFER NEBGEN Notary Public. State of Texas Comm. Expires 03-03-2021 Notary ID 131028966 d lie s Signatur (Personalized Seal)