HomeMy WebLinkAbout6/16/2004 - STAFF REPORTS (19) DATE: June 16, 2004
TO: City Council
FROM: Director of Public Works/City Engineer
FINAL MAP NO. 28966
RECOMMENDATION:
It is recommended that the City Council consider the following actions:
1. Accept Assignment and Assumption of Subdivision Improvement Agreement dated
May 27, 2004, between Preserve Golf Company, LLC, a California limited liability
company, and Calise Development, LLC, a California limited liability company, and
as transferring the terms and obligations of "Subdivider" stated in Agreement No.
4814 dated January 7, 2004, with the City of Palm Springs, to Calise Development,
LLC, a California limited liability company; and
2. Accept replacement securities from Calise Development, LLC, a California limited
liability company, to secure obligations required of Agreement No. 4814; and
3. Authorize the release of all original securities of Agreement No. 4814, provided by
Preserve Golf Company, LLC, a California limited liability company, replaced by
securities from Calise Development LLC, a California limited liability company.
SUMMARY:
Tract Map 28966 was originally developed by Preserve Golf Company, LLC, which has
subsequently agreed to sell the development to a new developer, Calise Development,
LLC. In order to accommodate the transfer of ownership and related obligations
associated with the Subdivision Improvement Agreement for Tract Map 28966, it is
necessary to recognize an Assignment and Assumption of Subdivision Improvement
Agreement between the two developers which will allow the transfer of obligations and
the replacement of subdivision securities.
BACKGROUND:
On January 7, 2004, City Council approved Final Map 28966 and approved the
associated Subdivision Improvement Agreement (Agreement No. 4814), between the
City of Palm Springs and Preserve Golf Company, LLC, a California limited liability
company, to secure the obligations required by development of Final Map 28966. The
terms of Agreement No. 4814 required that securities be submitted for "faithful
performance", "labor and materials", and "maintenance and warranty" of all related
subdivision improvements, as well as security for setting of map monumentation.
The original developer has entered into a purchase and sale agreement on the property
with a new developer, Calise Development, LLC, a California limited liability company,
who will take over as developer and builder of the project, and complete the required
subdivision improvements. The original developer has entered into an Assignment and
Assumption of Subdivision Improvement Agreement with Calise Development, LLC,
which relieves Preserve Golf Company, LLC, of its obligations imposed by Agreement
No. 4814 and transfers those obligations to the new developer, CaliseopDevelopment,
LLC. In order to accomplish the transfer of terms and obligations of the Subdivision
Improvement Agreement between the original and new developers, it is necessary for
City Council to recognize the Assignment and Assumption of Subdivision Improvement
Agreement entered into between the two development companies, accept the new
developer as "Subdivider" as it relates to the Subdivision Improvement Agreement for I&A
Tract Map 28966
June 16, 2004
Page 2
Tract Map 28966, accept replacement securities from the new developer, and release
securities submitted by the original developer.
These actions are being brought before the Council for its consideration, in order to
accommodate the transfer of the legal obligations from one developer to another and the
replacement of associated subdivision securities. The City Council's approval of these
actions will facilitate the successful completion of the development of this project by the
new developer.
SUBMITTED:
DAVID J. BARAKIANA
Director of Public Works/City Engineer
APPROVED:
,,AVID H. �Y
t y Managt r
ATTACHMENTS:
1. Resolution
2. Assignment and Assumption of Subdivision Improvement Agreement
3. Subdivision Securities
Recording Requested By:
When Recorded Mail To:
Ms. Valari Calis6
790 N. Mission Road
Palm Springs CA 92262
Space above For Recorder''s We Only
ASSIGNMENT AND ASSUMPTION
OF SUBDIVISION IMPROVEMENT AGREEMENT
This Assignment and Assumption of Subdivision Improvement Agreement
("Assignment") is entered into effective as of May aLj, 2004, by and between PRESERVE,
GOLF COMPANY, LLC, it California limited liabili:y company ("Assignor"), and CAUSE
DEVELOPMENT, LLC, a California limited liability c:)mpany("Assignee").
RECITALS
A. Assignor and the City of Palm Springs (the "City") entered into a Subdivision
Improvement Agreement dated as of December 30, 2003 (the "SI Agreement") relating to the
development of Tract 28966. Asset forth in the SI Agxement, Assignor has agreed to construct
and install certain improvements to accommodate the development of Tract 28966. Pursuant to
Section 4.1(a) of the SI Agreement and Assignor has provided the City with a Letter of Credit in
the amount of Eight Hundred Sixty-Seven Thousand Fight Hundred Fifty Dollars & 00/100
(S867,650,00) as security for the Assignor's faithful pei-formanee of the work required under the
SI Agreement , a copy of which is attached here to as Exhibit "A" and fully incorporated herein
by this reference. Assignor now desires to assign to Assignee, without representation or
warranty, all of Assignor's rights, titles, interests, benefits, privileges, claims, duties, and
obligations pursuant to, contained within and in accordance with the S1 Agreement,
B. Assignor and Assignee have entered into a purchase and sale agreement whereby
Assignor is selling to Assignee the real property which s controlled by the SI Agreement.
C. Now, therefore, for good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the undersigned agree, warrant and promise as follows;
ASSIGNMENT AND ASSUMPTION
1. Assignor hereby irrevocably and unconditionally grants, transfers, conveys,
assigns and delegates to Assignee of all of Assignor's tights, titles, interests, benefits, privileges,
claims, duties and obligations arising under, contained within or in respect to the Sf Agreement-
2. Assignor hereby represents and warrants to Assignee that to the best of Assignor's
actual knowledge (i) no default exists or has been timely assarted by either party tinder the SI
Agreement, (ii) no event exists which, with the passage of time and expiration ol'any applicable
notice/cure period, would constitute or Icad to a materi.1 default, uud (iii) the Sl Agreement is in
Page 1
full force in effect, The knowledge of Assignor is limited to the actual personal knowledge of
William H.McWethy, Jr., or Fred Grand based on written notice from the City of Palm Springs.
3. Assignee hereby fully accepts the folregoing assignment and unconditionally
assumes and agrees to perform, in a timely manner, all of the duties and obligations of Assignor
arising under or contained in the SI Agreement with the same force and effect as if Assignee had
initially executed the SI Agreement as the Subdivider,,as that term is used in the Sl Agreement.
Assignee agrees and acknowledges that upon execution of this Assignment Assignee shall
become the Subdivider under the SI Agreement.
4. After execution, of this Assignment by all parties, and subject to Assignor's
representation in Paragraph 2, above, Assignor shall have absolutely no obligation to Assignee
and shall have no liability of any nature under the SI Agreement. In this regard, Assignee, for
itself and for its members, agents, employees, predecessors, successors, assigns, agents, and all
other persons or entities who may claim through it, does hereby release and forever discharge
Assignor and its respective members, managers, ollioers, shareholders, partners, directors,
employees, agents, lenders, attorneys, successors, assigns, and related and/or affiliated parties,
from any and all manner of action, suit, lien, damage, expense (including attorneys' fees), claim
or demand of whatever nature heretofore or hereafter arising out of, related to, connected with or
incidental to the real property identified in the Sl Agreement or to the SI Agreement itself,
except for a breach of Assignor's representation in Paragraph 2 above, Notwithstanding the
foregoing to the contrary, Assignor and Assignee acktowledge that Assignor shall be retaining
two (2) lots which are within the real property (tht "Project") which is subject to the Sl
Agreement. Assignee aclnowledges that as part of the agreement between the parties, Assignee
shall be solely responsible for all performances and costs of the Subdivider under the ST
Agreement. Assignor agrees that to the extent it is necessary for the development of the Project
in accordance with the terms and provisions of the SI Agreement, Assignor shall cooperate with
Assignee.
5. In addition to the specific release set forth in Section 3, above, and subject to
Assignor's representation in Paragraph 2, above, Assignee agrees that it will file no actions,
petitions or complaints (administrative or judicial) against Assignor with regard to any facts or
actions arising out of the SI Agreement. It is specifically agreed that the agreement contained
herein is a full and final release of any and all claims of dernands by Assignee and for any claims
related to any matter arising from or related to the Sl Agreement, except for a breach of
Assignor's representation in Paragraph 2, above.
6. Waiver of Civil Code Section 1542 California Civil Code Section 1542
provides:
A GENERAL RELEASE DOES NOT EXTENT) TO CLAIMS WHICH
THE CREDITOR DOES NOT KNOW DR SUSPECT TO EXIST IN HIS
FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF
KNOWN BY HIM MUST HAVE MATERIALLY AFFECTED HIS
SETTLEMENT WITH THE DEBTOR,
Page 2 164
Assignee knowingly and voluntarily waives the provisions of Civil Code Section 1542
and any other comparable provisions or principles of state, federal or common law and
acknowledges and agrees that this waiver is an essential and material term of this Assignment
and the release provisions contained herein and that, without such waiver, this Assignment
would not have been entered into. Assignee understands and acknowledges the significance and
consequences of the release set forth herein and this specific waiver of Civil Code Section 1542
and all other comparable provisions or principles of state, federal law or common law.
Assignee's initigls
7. Assignee acknowledges that Assignee is filly and completely familiar with the
terms of the SI Agreement and that Assignee would not have entered into this Assignment if it
had not fully and completely satisfied itself with the terms of the SI Agreement and the real
property it affects. The assignment of the SI Agreement under this Assignment is in no way
intended(and in no way implies) to change any of the terms of the purchase and sale agreement
between the parties or is it intended to imply that Assignor is making any warranty or
representation (except as set forth expressly in Paragraph 2, above), to Assignee or that any of
the improvements contemplated by the SI Agreement may be accomplished or are feasible,
8. Assignee acknowledges that the SI Agreement references, contains and imposes
upon Subdivider certain obligations in regards to bonding, credit arrangements and performance
of improvement obligations. Assignee understands the foregoing obligations, and warrants to
Assignor that Assignee has the capacity and ability to make all performances required of the
Subdivider under the 31 Agreement or bear the consequences thereof. This Assignment shall not
be effective in full until Assignee has replaced all of the bonds and/or any other credit, payment
or performance obligation of the Subdivider under the Sl Agreement. Assignee realizes that
Assignor will be substantially hamled by Assignee's failure to have any of Assignor's bonds or
any of the other financial guarantees or deposits described in the SI Agreement released by the
date of the close of the escrow for the sale of the real property which is subject to the terms of
the SI Agreement. Therefore, Assignee reaffirms and reacknowledges that the failure or inability
of Assignee to replace the bonds and/or any other financial obligation related to the real property
to which Assignor is a party or an obligor is a non-curable breach of the purchase agreement
between them., and Assignor has the right to terminate the purchase agreement, the escrow and
the sales transaction, and to immediately exercise any rights of Assignor thereunder. Time is
specifically of the essence for the performance set forth in this provision, and there shall be no
extension of time for any reason unless agreed to in writing by the Assignor.
9. This Assignment may be executed in one or more counterparts, each and all of
which shall be deemed an original, and all of which taken together shall constitute but one
agreement True and correct copies, including electronic and facsimile copies may be used in
lieu of an original-
10. Time is of the essence. This is the entire agreement between the parties in regards
to the subject matter contained herein. This Assignment shall be interpreted under the laws of
the State of California, All of the parties hereto have been represented by legal counsel of their
16 �
Page 3
choice are not relying an any statement of the other party in entering herein. Each party has
cooperated and participated in the drafting and the preparation of this Assignment. Hence, in
any construction to be made of this Assignment, no ambtguity shall be resolved against any party
by virtue of that party's participation in the drafting of this Assignment.
11, In the event legal action is commenced to enforce the terms of this Assignment,
the prevailing party shall be entitled to their reasonable attorneys' fees and court costs.
12, The parties acknowledge that the City of Palm Springs is not a party to this
Assignment and the SI Agreement does not require the consent of the City of Palm Springs to an
assignment, However, if the City of Palm Springs makes any requests in the future relating to
the SI Agreement, the parties agree to cooperate therewith, and to take action necessary to
effectuate the purpose of this Assignment.
13, 1f any provision, section, paragraph, clause or sentence in this Assignment is
declared to he illegal, void, invalid, or unenforceable by a court or other authority with
jurisdiction thereof, the remaining provisions, paragraphs, clauses, and sentences shall be
severable and shall remain in full force and effect. The parties agree that a void or invalid
paragraph, clause or provision shall not affect the validity or enforceability of the remaining
provisions of this Agreement.
14. Except for breaches of Assignor's representation contained to Paragraph 2, above,
Assignee agrees to indemnify, defend, and hold harmless Assignor and its respective members,
managers, officers, shareholders, partners, directors, employees, agents, lenders, attorneys,
successors, assigns, and related and/or affiliated parties from and against any and all claims,
liabilities, losses, damages, causes of action and obligations arising out of or related to the Sl
Agreement. Said indemnity obligation shall apply to personal injury, death, property damage,
economic loss and any other monetary damage or penalty to which Assignor may be subjected,
including without limitation, reasonable attorneys' fees and costs. Such indemnity shall not
extend to any loss resulting from Assignor's gross negligence or willful misconduct. The
foregoing indemnity shall survive the transfer of the real property and the close of the escrow
therefor. Assignor agrees to indemnify, defend and hold harmless Assignee and its respective
members, employees, agents, lenders, attorneys, successors, assigns and related and/or affiliated
parties from and against any and all claims, liabilities, losses, damages, causes of action and
obligations arising out of or related to the breach of Assignor's representation contained in
Paragraph 2, above.
15, This Assignment contains the entire agreement between the parties hereto, and the
terms of this Assignment are contractual and not merely recital. Any amendment to this
Assignment shall not be valid or binding unless in writing and executed by each of the parties
hereto.
16, By her signature below, Valari Calise', an individual, hereby agrees to
unconditionally guarantee, and to be personally liable for, all of Assignee's covenants and
obligations under this Assignment and under the S1 Agreement, and further acknowledges that
Page 4
e 7
Assignor would not have executed this Asstgntnent (or the related sale documentation) without
this personal undertaking of Valari Calisd,
IN WITNESS WHEREOF, Assignor, Assignee and Valari Calise have executed this
Assignment effective as of the day and year first above written.
"Assignor"
Preserve Golf Company, LLC,
a California�Lii9mited Liability Company
By: Ul
Name: WILLIAM H. MCWETHY, JR_
Title: PRESIDENT
"Assignee"
Calisd Development, LLC,
a California Limited Liability
By u
Valari Calisd, its Sole Member
Valari Calise, an Individual
Page 5
STATE OF CALIFORNIA )
COUNTY OF SAN DIEGO
On May 27 ,2004, before roe, Sus2Fn E. Dorin
a notary public in and for said state,personally appeared William H. Mcwethv, -
personally known to me(or proved q'me on the basis of satisfactory evidence)to be the person
whose name is subscribed to the within instrument and acknowledged to me that he executed the
same in his authorized capacity, and that by his signature on the instrument the person, or the
entity upon behalf of which the person, executed the instrument.
WITNESS my hand and official seal. "O t an I
Cb1AlYM 0 06M
2M MW CW*
Signature: MyCen,BrterNtr11.�6
STATE OF CALIFORNIA )
COUNTY OF j&495(kc ) as.
On Jed nL z ,2004,before me, PA'r&ICrA a u;L(;W
a notary public in and for said state, personally appeared !/AL-AR! C 4 L rSE
personally known to me(or proved to me on the basis of satisfactory evidence)to be the person
whose name is subscribed to the within instrument and acknowledged to me that he executed the
same in his authorized capacity, and that by his signature on the instrument the person, or the
entity upon behalf of which the person, executed the instrument.
WITNESS my hand and official seal.
�`� PATAICIA A. MC HUGH
Signature: �CLCGt /1 l�i� N Cr,mm.A t275b�9
�a ' iay dA'l PUBLIC CAtIFpBNP �
1l -' Sort Diego County
n7v Comm.Exovn SeP.27,700� '�
Page 6 7
RESOLUTION NO.
OF THE CITY COUNCIL OF THE CITY OF PALM
SPRINGS, CALIFORNIA, FACILITATING REPLACEMENT
OF DEVELOPERS OF FINAL MAP NO. 28966
WHEREAS, the City Council at its meeting of January 7, 2004, approved Final Map
28966, and entered into a Subdivision Improvement Agreement (Agreement No. 4814)
with Preserve Golf Company, LLC, a California limited liability company; and
WHEREAS, pursuant to Agreement No. 4814, securities are held by the City of Palm
Springs to guarantee construction of certain improvements associated with Final Map
No. 28966; and
WHEREAS, Preserve Golf Company, LLC, a California limited liability company, has
entered into a purchase and sale agreement of Final Map 28966 with Calise
Development, LLC, a California limited liability company; and
WHEREAS, it is necessary to transfer the terms and obligations of Agreement No. 4814
from Preserve Golf Company, LLC, to Calise Development, LLC, accept replacement
securities, and release original securities.
NOW THEREFORE BE IT RESOLVED by the City Council of the City of Palm Springs,
California as follows:
1. That the Assignment and Assumption of Subdivision Improvement Agreement dated
May 27, 2004, between Preserve Golf Company, LLC, a California limited liability
company, and Calise Development, LLC, a California limited liability company, is
recognized and accepted as transferring the terms and obligations of "Subdivider"
stated inAgreement No. 4814 dated January 7, 2004, with the City of Palm Springs,
to Calise Development, LLC, a California limited liability company; and
2. That replacement securities from Cal ise'Development, LLC, a California limited
liability company, are accepted to secure obligations required of Agreement No.
4814; and
3) That the release of all original securities of Agreement No. 4814, provided by
Preserve Golf Company, LLC, a California limited liability company, replaced by
securities from Calise Development LLC, a California limited liability company is
authorized.
ADOPTED this 16t' day of June, 2004.
AYES:
NOES:
ABSENT:
ATTEST: CITY OF PALM SPRINGS, CALIFORNIA
By
City Clerk City Manager
REVIEWED &APPROVED AS TO FORM:
City Attorney I ,