HomeMy WebLinkAbout00527C - RE: LOFT PARTNERS PALM SPRINGS LLC DDA 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 PROJECT AREA NO. 2
4J
946623035983/0003 V�,� R
TABLE OF CONTENTS
[NOTE,: TOC TO BE UPDATE ONCE.AGREEMENT 1S FINAL]
I. [§100] SUBJECT OF AGREEMENT.... ................. ........................................I
A. [§1011 Purpose of This Agreement...................................................................1
S. [§102J The Redevelopment Plan............................................................ . . ....I
C. [§103] The Project Area........................... ............................ ..........2
D- [§104] The Site ..................... .............................. . . ..............................2
E. [§105] Parties to This Agreement........................................................... .......2
F. [§108] Deposit.................................. .................. ...............3
11. [§200] DISPOSITION OF THE SITE................................................... ............................... 4
A. [§201] Sale and Purchase; Lease ..................................................4
B. [§202] Escrow...................................................................................................5
C. [§203] Conveyance of Title and Delivery of Possession..................................8
D. [§204] Conditions Precedent.......................... ..................................................8
F. [§2091 Farm of Deed; Ground Lcase..............................................................I l
F- [§2101 Condition of Title. ..................... ......................-- 11
G. [§211] Time for and Place of Delivery of Deed...................... I l
H. [§2121 Payment of the Purchase Price and Recordation of Deed and
Memorandum of Lease........................................................................12
1. [§213] Title Insurance. .. ....................... ......................... 12
J. [§214] Taxes and Assessments .............12
........................................
K- [§215] Conveyance Free of Possession...........................................................13
L. [§216] Inspections;Conditions of the Agency Parcel.....................................13
M. [§217] Zoning of the Site .............................................. ..........15
N. [§218] Condition of the Agency Parcel and Parking Parcel..... 15
0. [§219] Preliminary Work by the Developer......................... ..........................16
P. [§220] Submission of Evidence of Equity Capital and Mortgage Financing..16
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Ill. [§300] DEVELOPMENT OF THE SITE .................. ..........................................................16
A. [§3011 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
Passes ......................................23
G. [§323] Certificate of Completion....................................................................23
H- [§324] Prevailing Wages.................................................................. . ...........24
IV. [§400] USE OF THE.SITE........... ............. .................... • .............................25
A. [§401] Uses... ................................................... .. .....................25
B. [§402] Hotel Operator............................... -- ........... 25
C. [§403] Obligation to Refrain From Discrimination 26
D. [§404] Form of Nondiscrimination and Nonsegregation Clauses 26
E. [§405] Effect and Duration of Covenants.......................................................27
V. [§500] DEFAULTS,REMEDIES AND TERMINATION.........................................................28
A. [§501] 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. [§600] GENERAL PROVISIONS ....................................34
A. [§6011 Notices,Demands and Communications Between the Parties............34
B- [§602] Conflictsofhxterest.................... ......................................................34
C. [§603] Nomhability of Agency Officials and Employees................................34
D. [§604] Enforced Delay. Extension of Times of performance 34
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E. [§605] Inspection of Books and Records........................................................35
F. [§606] PlansandData.................................... ..................................35
G. [§607] Attorneys'Fees................................ ...............................................35
VII. [§700] SPECIALPROVISIONS.............................. .............................................35
A. [§7011 Amendment of Redevelopment Plan...................................................35
B. [§702] Submission of Documents to the Agency for Approval 36
C. [§703] Amendments to this Agreement..........................................................36
VHL [§8001 ENTIRE AGREEMENT,WAIVERS AND AMENDMENTS.......................................36
IX. TIME FOR ACCEPTANCE OF AGREEMENT BY AGENCY .. ...............................37
Attachments
Attachment No, 1 Map of the Site
Attachment No. 2 Legal Description of the Site
Attachment No. 3 Schedule of Performance
Attachment No.4 Scope of Development
Attachment No. 5 Form of Chant Deed
Attachment No. 6 Promissory Note
Attachment No. 7 Deed of Trust
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DISPOSITION AND DEVELOPMENT AGREEMENT
THIS AGREEMENT is entered into as of the _ day of
2007, by and between the COMMUNITY 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:
I. 1§1001 SUBJECT OF AGREEMENT
A. [§1011 Purpose of This Agreement
The purpose of this Agreement is to effectuate the Amended and Restated
Redevelopment Plan (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 units, 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. [§1021 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 may be 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 Plan.
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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 n-lore particularly described in the Legal Description of the Site
(Attaclmient 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
"Condo/Hotel 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 (AttaclnnentNo. 1).
E. [§105] Parties to This Agreement
1. [§106] TheAgenev
The Agency is a public body, corporate and politic, exercising
governmental functions and powers and organised and existing under the Cormnunity
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 Developer
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 teen
"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
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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, conveyee, 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, i f 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 (S250,000) (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 fomr 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, frorn a bank authorized to do business in
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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 tennination 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. If 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. [§2001 DISPOSITION OF THE SITE
A. [§201] 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 (54,675,000) (the "Purchase Price"),
$3,742,750 of which shall be paid at the close of escrow and the remaining 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 terns 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 Attaclunent ("Deed of Trust"), which
shall only encumber Parcel 3 of Tentative Map No. 3�a .
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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 date for the close of escrow:
I_ 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
9456230 35983/0003 5 12/13/2007
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
tirne 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 teens and provisions of this
Agreement. hrunediately 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
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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 manner 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
petfonnance 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. [§203] 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 teens 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 8 12/13/2007
development of that portion of the Agency Parcel that is
being closed upon pursuant to this Agreement, excepting a
final planned development pen-nit 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 pemlits.
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 land use approvals required £or 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.
9456230 35983/0003 9 12/13/2007
4. Liquidated Datxaages
IF THIS AGREEMENT IS TERMINATED I3Y 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 WITIIOUT ANY DEDUCTION, OFFSET OR
RECOUPMENI WHATSOEVER. 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 NEGOTIATING 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 TFIAT 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 3.5983/0003 10 12/13/2007
E. [§205] FOrmofDeed
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 (15) 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 free and clear of all recorded liens, encumbrances, assessments, leases, and taxes
except as are consistent with this Agreement and as approved by the Developer pursuant
to this Section.
G. [§207] 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).
9456230 35983/0003 11 12/B/2007
H. [§2081 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 suns 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.
I. [§2091 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 an 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 bonze 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
K. [§21 l] 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] lnspections; 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, Enviromnental 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
]invitation, 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 comiection 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 ftom 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 359s3/0003 13 12/13/2007
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 Indemnitees arising out of or in connection with any Hazardous
Materials (as defiled 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 parry 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.
945623v3 35983/0003 14 12/13/2007
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 Agency's 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 zoned so as to pen-nit 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 detennine 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
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 fzonr 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 pennrts 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
comnnitrnents for mortgage financing.
IIl. [§3001 DEVELOPMENT OF THE SITE
A. [§301] Development of the Site by the Developer
1. [§3021 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
9456230 35983/0002 16 12/13/2007
changes may be 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 terns 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
9456230 35983/0003 17 12/13/2007
changes that the City/Agency requests be made_ Such reasons and such changes must be
consistent with the Scope of Development (Attaclunent No. Q) 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
Alter 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 (Attaclnnent
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.
9456230 35983/0003 18 12/13/2007
7. [§308] Bodily Injury_,_ Property Damage and Workers'
Compensation Insurance
Prior to the commencement of construction on the Site or any
portion thereof, the Developer shall fumish 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 furnished
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 dus 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 Aguncv 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 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.
945623v3 35983/0003 19 12/13/2007
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 thereol), 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.
945623v3 35983/0003 20 12/13/2007
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 constrict 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.
9456230 35983/0003 21 12/13/2007
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 rnade 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 35933/0003 22 12/13/2007
b. All expenses with respect to foreclosure;
C. The net expenses, if any (exclusive of general overbead),
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] 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 holder 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.
F_ [§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 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 Parcel,
the Agency shall furnish the Developer with a Certificate of Completion upon written
9456230 25983/0003 23 12/13/2007
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 tq 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 refuses 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 12/13/2007
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.
IV. [§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-hotel units, ten thousand (10,000)
square feet of "under-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 12/13/2007
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. [§403] Obligation 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. [§404] 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 of 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 die 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,
945623v3 35983/0003 26 12/13/2007
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 Govermnent 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 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."
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 Govermnent 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"
9456230 35983/0003 27 12/13/2007
The Agency is deemed the beneficiary of the teens and provisions of this
Agreement and of the covenants rum7ing 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 W 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 darnages 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.
945623v3 35983/0003 28 12/13/2007
2. [§504] Applicable Law; Interpretation
The laws of the State of California shall govern 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.
3. [§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 Executive 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 of Cali fomia_
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
tines, 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:
I. rail 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 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
945623v3 35983/0003 29 12/13/2007
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 "soft 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 corrunon 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 12/13/2007
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
[I. 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 govermnental 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
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.
1 . [�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 "conunence 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
9456230 35983/0003 31 12/13/2007
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
farther 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 "soll goods" financing, (iii) mezzanine
or similar debt, or (iv) any sale of transfer that is expressly
pennitted by the tenns 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 tennination
shall be subordinate and subject to and be limited by and shall not defeat, render invalid
01 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 reverting 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
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 fi-om 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 making 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.
945623v.3 35983/0003 33 12/13/2007
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
con-lmunications 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 employee 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. [§603] 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 Delay 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
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] Inspection 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 times, to inspect the books and records of the Agency
pertaining to the Site as pertinent to the purposes of this Agreement.
F. [§6061 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-
G. [§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 proceedings shall include an award thereof.
VIi. [§7001 SPECIAL PROVISIONS
A. [§701] Amendment of Redevelopment Plan
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
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 Agreement
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 terns and provisions of the Attaclunnents, the teens and provisions of
the Attachments shall control.
VIII. [§800] 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. I 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
9456230 35983/0003 36 12/13/2007
more favorable than the terns and provisions contained herein, then the corresponding
terns 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. TJME 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 THE. CITY OF PALM
SPRINGS, a public body, corporate and
politic )
By: ��. /
-ATTES'T<_
'title:
:. _ ✓ By:
1 •Z - -Assi.s-tan Secretary Title:
"AGENCY"
Approved td form:
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Agency Counsel
1249q-- RE: LOFT PARTNERS PALM SPRINGS,
LLC, a Delaware limited liability company
i
By:
Title:
;; ,
"DElLOPER"
945623v3 35983/0003 37 12/13/2007
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 THE CITY OF PALM
SPRINGS, a public bod ,ecorporate and
politic
By: J
M
Title:
d
By:
� y
"AGENCY"
Approved as to form:
Agency Counsel
2007 RE: LOFT PARTNERS PALM SPRINGS,
LLC, a Delaware limited liability company
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SHARON K DENNIS Titlei
NOTARY PUBLIC
COBB COW Y,GEORGIA
MY COMMISSION EXPIRES JUNE 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.
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-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
autborization, execution and delivery of this Agreement. The effective date of this
Agreement shall be the date when this Agreement has been signed by the A y_
, 2007 COMMUNITY REDEVELOPMENT
AGENCY OF TITE /TY OF PALM
SPRINGS, a public ody, corporate and
politic
By:
Title:
By:
Tit V
Approved as to form: "AGENCY"
Agency Counsel
12007 RE: LOFT PARTNERS PALM SPRINGS,
LLC, a Delaware limited liability company
By:
Title: aX d Wdanil X n potimSprillos,l,
By:
Title:
By:
ile:
��� "DEVELOPER"
ATTACHMENT NO. 1
MAP OF THE SITE
W623v3 35983/0003 Attachment No. 1 12/13/2007
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ATTACHMENT NO. 2
LEGAL DESCRIPTION OF TIME SITE
Agency Parcel:
All that certain real property located in the City of Palm Sprinns, 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 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.
945623v335983/0003 AttachmcntNo 2 12/13/2007
ATTACHMENT 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 Witten 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 Plan,
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 marketing Agreement by the
Agreement. 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,
S. Acceptance --Evidence of Equity inancing Within 30 days after Section 216, May 30,
Hotel Management Agreement, and submission to the Section 402 2008
Condominium Licensing and marketing_ Agency Counsel.
Agreement by Agency 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
11. Aporoval or Disa roval 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.
12_ Aaency 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 of On or before 1:00 p.m. Section 208
Construction Financing. 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 Agency'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 evidencine 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
20. Estotipel Certificate Taxpayer M Certificate On or before 1:00 p.m. Section 202
PIRPTA Certificate. The Agency shall on the last business day
deposit an Estoppel Certificate,Taxpayer Ill preceding the Closing
Certificate, PIRPTA 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.
convenyance. 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 Section 323 June 1,
Developer shall request from the Agency a completion of all 2011
Certificate of Completion on the Hotel Parcel construction 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
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.
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.
B. Developer's Improvements
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"under roof' group meeting space and on-site parking which tneets 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
Progiram,
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 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 Developer's improvements.
D. Landscaping
Landscaping shall embellish all open spaces upon the Site to integrate the
Developer's improvements with adjacent sites within the Project Area. 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 Attachment Na.4,Page 1 12/13/2007
pedestrian lighting. Landscaping shall carry out the objectives and principles of the
Agency's desire to accomplish a high duality aesthetic enviromnent.
E. Suns
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.
Il. SITE CLEARANCE AND PREPARATION
The Developer shall perform, or cause to be perfonned, 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.
9456230 35983/0003 Attachment No.4,Page 2 12/13/2007
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 Attachment No.4,Page 3 12/13/2007
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 acknowledged,
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
Palm 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 (die "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 Attachment No 5,Page 1 12/13/2007
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 and 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-fine 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.
9456230 35983/0003 Attachment No.5,Page 2 12/13/2007
(d) Any and all chemicals, unhealthful substances, and
pesticides used in and during maintenance shall be
applied in strict accordance with all govenunental
requirements. Precautionary measures shall be
employed recognizing that all areas are open to
public access-
(c) The improvements shall be maintained in
confonnance 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 cute 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
cormuenced 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 Clailn 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 good faith and for value, recorded as of the date of the recordation of the
Notice of Claim of Lien, 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
945623v3 359S310003 Attachment No.5,Page 3 12/13/2007
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
Motel 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 of Completion pursuant to Section 323 of the DDA, Grantee shall:
a. Fail to conunence 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
intprovernents; 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 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 lien against all 01 any
portion of or any interest in the Site, except for any sale,
assignment, transfer, disposal or encumbrance that is expressly
permitted by the terns of the DDA. For the purpose of this
paragraph, the tern-is "sell' and "transfer" shall include, in addition
945623v3 35983/0003 Atiachmem No.5,Pa-e 4 12/13/2007
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 tern 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 govenuriental 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 prior 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
whatsoever. For purposes of this provision, the Grantee shall be
deemed to "commence construction" when and only when the
9456230 359S3/0003 Attachment No 5,Page 5 12/13/2007
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, (ail 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 constriction 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 lien against all or any
portion of or any interest in the Site, except for any sale or transfer
that is expressly permitted by the terms of the DDA. For the
purpose of this paragraph, the terns "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
fiom 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 California 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 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 interest provided in the DDA for the protection of the
holder of such mortgages, deeds of trust or other security
instruments.
Upon reverting 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
9456230 35983/0003 Mkwhmcnt No 5,Page 6 12/13/2007
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. First, 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 such 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 of persons
on any basis listed in subdivision (a) or (d) of Section 12955 of the Government Code, as
9456230 359S3/0003 Aaachment No.5,Page 7 12/13/2007
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 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 vendees
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
Govermnent 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 leasing, subleasing,
transferring, use, occupancy, tenure or enjoyment of the
premises herein leased, nor shall the lessee himself or
945623v3 35983/0003 Anachnn:nc No.5,Pale 8 12/13/2007
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."
a 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 until (the temrination 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 any 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 35933/0003 Allachmcnl No,5,P®gc 9 12/13/2007
covenants contained in this Grant Deed shall he 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.
11. 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 12/1312()07
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 Auaahmeni No,5,Page 11 12/13/2007
ACKNOWLEDGMENTS
9456230 35983/0003 Attachment No.5,Acknowlnmgm=ts 12/13/2007
EXI3IBIT A
LEGAL DESCRIPTION OF THE SITE
AA en�arcel-
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.
Develo ear Parcel:
BLOCK 102 IN SECTION 14, TOWNSHIP 4 SOUTH, RANGE 4 EAST, SAN
BERNARDINO MERIDIAN, rN THE CITY OF PALM SPRINGS, COUNTY OF
RIVERSIDE, STATE OF CALIFORNIA, ACCORDING TO THE OFFICAL PLAT
THEREOF.
9456230 35983/0003 Attachmcnt No 5 12/13/2007
ATTACHMENT NO. 6
PROMISSORY NOTE
[To Be Produced with Escrow Documents.]
945623v3 35983/0003 Attachment No.7 12/13/2007
ATTACHMENT NO. 7
DEED OF TRUST
[To Be Produced with Escrow Documents.]
at 1G0S44 3
945623v3 35983/0003 Attachment No.8 12/13/2007