HomeMy WebLinkAbout7/17/2002 - STAFF REPORTS (4) DATE: JULY 17, 2002
TO: COMMUNITY REDEVELOPMENT AGENCY
FROM: DIRECTOR OF COMMUNITY 8, ECONOMIC DEVELOPMENT
APPROVAL OF AN OPTION AGREEMENT WITH BURNETT COMPANIES ON A 19.17
ACRE PARCEL AND A 22.21 ACRE PARCEL NEAR THE CORNER OF SUNRISE WAY
AND SAN RAFAEL ROAD; AND, APPROVAL OF THE LOT LINE ADJUSTMENT
NECESSARY TO FACILITATE THE AGREEMENT
RECOMMENDATION:
It is recommended that the Agency approve an Option Agreement with Burnett
Companies on a 19.17 + acre parcel and a 22.21 acre parcel at the corner of
Sunrise Way and San Rafael Road to facilitate the development of a major single-
family-home development; and, approve a lot line adjustment necessary
BACKGROUND:
In February, 2000 the Agency received an offer from Burnett Development
Corporation (the "Developer') to purchase a 19.17 + acre Agency-owned parcel
and a 22.21 acre City-owned parcel at the corner of Sunrise Way and San Rafael
Road for fair market value. The Developer is assembling land to build a major
single-family-home development in the area. The City sold an 11,000 s.f. parcel of
land to the Developer in 1998 as part of the Developer's land assemblage.
This Option Agreement allows Burnett to proceed with the financing of the project,
which is tied to the financing of Palm Springs East across Sunrise Way. That
project has already received its Planning Commission and City Council approvals;
the Palm Springs West project is due to receive its approvals later this summer.
The Agency's 19.17 acre parcel was acquired from the City as half of the Sunrise
Mobile Home Park acquisition in 1995. Because the 19.17 acres has not been
subdivided yet from the Mobile Home Park, there is not yet a legal description of
the property. Engineering has, however, completed the work necessary for a lot
line adjustment. The Agency acquired the City's 22.21 acres north of the 19.17
acres. This parcel forms the northern tier of the entire 100 acre parcel once
entirely owned by the City, but which now includes Sunrise Norte (single family
homes on City land leases), the Mobile Home Park (on land owned now by the
Agency), and Coyote Run, a 140-unit 100% affordable apartment complex built
and owned by the Coachella Valley Housing Coalition.
As part of the negotiation, Agency staff commissioned an appraisal on the
properties, first in May 2000 and a follow-up in February 2002. Since Burnett is
not proposing to construct low-income housing on the land, they will pay"fair
market" value, as the Low/Mod Housing Fund would not be able to write down
their land cost.
There remains a separate proposal from a non-profit housing group to purchase
and rehabilitate the mobile home park, and a draft DDA has been prepared for
their review. The timetable on the purchase affects the Burnett DDA, because the
lot line that now separates the 19.17 acre parcel from the 22.21 acre parcel would
have to be moved to separate the mobile home park from the 19.17 acre parcel.
The actual closing on the sale of the 19.17 acre parcel to Burnett will occur wh
e w6
the mobile home park sale is completed, though staff has commenced negotiation
with the sellers to come up with a strategy that would allow the Burnett project to
proceed with their project ahead of the mobile home park. A map is enclosed that
shows the various properties.
The net sale proceeds of the two parcels will be shared by the City and the
Agency based on the respective value of the two (2) parcels: the previously-City-
owned parcel was valued at $465,000, while the portion closest to the mobile
home park is valued at $615,000. The latter amount would flaw back to the
Low/Mod Housing Fund.
Also included in this action is a lot line adjustment that combines the northern half
of Parcel R with Parcel Q. Ordinarily a lot line adjustment would be approved at
the staff level; however, the Agency needs to approve the lot line adjustment
because it is currently the property owner. The recordation of the lot line
adjustment would be subject to a release of the mobile home park owner's
leasehold interest in the 19.17 acres. In addition, there is a Sewer Easement that
is necessitated by the proposed velopment plan.
H S. RAYM
it for of Com unity and Economic Development
AP RP OVED 2/
Executive Director'
ATTACHMENTS:
1. Resolution
2. Option Agreement
3. Map of Properties
4. Lot Line Adjustment
5. Grant of Easement
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OPTION AGREEMENT
BY AND BETWEEN
THE PALM SPRINGS COMMUNITY REDEVELOPMENT AGENCY
AND
BURNETT DEVELOPMENT CORPORATION
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TABLE OF CONTENTS
Page No.
Section1. Definitions.................................................................................................... 1
Section2. Grant of Option. ........................................................................................... 3
Section3. Term of Option............................................................................................. 3
Section 4. Consideration for Option. ............................................................................. 4
Section 5. Credit for Option Consideration.................................................................... 4
Section 6. Disbursement of Option Consideration. ........................................................ 4
Section 7. Retention of Option Consideration................................................................ 4
Section S. Purchase Price. ............................................................................................. 4
Section 9. Subdivision Compliance. .............................................................................. 4
Section 10. Consummation of Option............................................................................ 5
Section 11. Exercise of Option. ..................................................................................... 5
Section12. Acreage. ..................................................................................................... 6
Section 13. Closing of the Purchase of Parcels. ............................................................. 6
Section 14. Title Insurance; Possession. ........................................................................ 6
Section 15. Development of Property. ........................................................................... 6
Section 16. Planning of Development; Other Property................................................... 7
Section 17. Optionor's Representations and Warranties................................................. 7
Section 18. Optionor's Conduct Prior to Closing........................................................... 8
Section 19. Prior Use of the Property. ........................................................................... 8
Section 20. Representations and Warranties. ................................................................. 9
Section21. Time of Essence. ........................................................................................ 9
Section22. Default........................................................................................................ 9
Section23. Quitclaims. ............................................................................................... 10
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Section24. Transfer. ................................................................................................... 10
Section25. Notices. .................................................................................................... 10
Section26. Waiver...................................................................................................... 11
Section 27. Litigation Costs. ....................................................................................... 12
Section28. Integration. ............................................................................................... 12
Section 29. Survival of Covenants............................................................................... 12
Section30. Brokers..................................................................................................... 12
Section 31. Changes in Writing................................................................................... 12
Section 32. Indemnified Parties................................................................................... 12
Section33. Counterparts. ............................................................................................ 12
Section 34. Invalidity of Provisions............................................................................. 12
Section 35. Successors. ............................................................................................... 13
Section 36. Third-Party Rights. ................................................................................... 13
Section37. Construction. ............................................................................................ 13
Section 38. Further Assurances. .................................................................................. 13
Section 39. Governing Law......................................................................................... 13
C CO, � 0'r
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OPTION AGREEMENT
This Option Agreement (Agreement) is entered into as of July 2002, between The
Palm Springs Community Redevelopment Agency, a public body (Optionor) and Burnett
Development Corporation, a California corporation (Optionee).
Recitals
A. Optionor is the owner of two parcels of certain real property in the City of Palm
Springs, Riverside County, California located on the corner of Sunrise Way and San Rafael Road
consisting of approximately 40 acres, and more particularly described in attached Exhibit A and
Al, including all rights, easements, and privileges appurtenant to the real property (collectively,
"Property").
B. Optionee desires to acquire the exclusive right to purchase the Property at an
agreed price and under the specific terms and conditions below.
C. Optionor and Optionee are currently in the process of negotiating a Disposition
and Development Agreement ("DDA") for the property pursuant to the requirements of
California Community Redevelopment Law and the exercise of the Option shall be subject to
prior approval of the DDA by both parties.
For good and valuable consideration, the receipt and adequacy of which are
acknowledged, the parties agree as follows:
Section 1. Definitions.
Agreement is defined in the preamble.
Closing Date is defined in Section 11(a).
Consummation of the Option is defined in Section 10.
Environmental Laws means all federal, state, local or municipal laws, rules, orders,
regulations, statutes, ordinances, codes, decrees, or requirements of any government authority
regulating, relating to, or imposing liability or standards of conduct concerning any Hazardous
Substance (as later defined), or pertaining to occupational health or industrial hygiene (and only
to the extent that the occupational health or industrial hygiene laws, ordinances, or regulations
relate to Hazardous Substances on, under, or about the Property), occupational or environmental
conditions on, under, or about the Property, as now or may at any later time be in effect,
including without limitation, the Comprehensive Environmental Response, Compensation and
Liability Act of 1980 [42 USCS§ 9601 et seq.]; the Resource Conservation and Recovery Act of
1976 [42 USCS §§ 6901 et seq.]; the Clean Water Act (also known as the Federal Water
Pollution Control Act) [33 USCS§§ 1251 et seq.]; the Toxic Substances Control Act [15 USCS
§§ 2601 et seq.]; the Hazardous Materials Transportation Act [49 USCS §§ 1801 et seq.]; the
Insecticide, Fungicide, Rodenticide Act [7 USCS §§ 136 et seq.]; the Superfund Amendments
and Reauthorization Act [42 USCS §§ 6901 et seq.]; the Clean Air Act [42 USCS §§ 7401 et
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seq.]; the Safe Drinking Water Act [42 USCS§§ 300f et seq.]; the Solid Waste Disposal Act [42
USCS§§ 6901 et seq.]; the Surface Mining Control and Reclamation Act [30 USCS§§ 1201 et
seq.]; the Emergency Planning and Community Right to Know Act [42 USCS§§ 11001 et seq.];
the Occupational Safety and Health Act [29 USCS§§ 655 and 657]; the California Underground
Storage of Hazardous Substances Act [H & S C §§ 25280 et seq.]; the California Hazardous
Substances Account Act [H & S C §§ 25300 et seq.]; the California Hazardous Waste Control
Act [H& S C§§ 25100 et seq.]; the California Safe Drinking Water and Toxic Enforcement Act
[H & S C§§ 24249.5 et seq.]; the Porter-Cologne Water Quality Act [Wat C§§ 13000 et seq.],
together with any amendments of or regulations promulgated under the statutes cited above and
any other federal, state, or local law, statute, ordinance, or regulation now in effect or later
enacted which pertains to occupational health or industrial hygiene, and only to the extent that
the occupational health or industrial hygiene laws, ordinances, or regulations relate to Hazardous
Substances on, under, or about the Property, or the regulation or protection of the environment,
including ambient air, soil, soil vapor, groundwater, surface water, or land use.
Exercise Notice is defined in Section I I(a),
Gross Acre or Gross Acreage means the entire gross area acquired by Optionee,
including portions subject to existing or future dedication of public streets or other dedications
required by governmental public agencies.
Hazardous Substances include without limitation:
(a) Those substances included within the definitions of hazardous substance,
hazardous waste, hazardous material, toxic substance, solid waste, or pollutant or contaminant in
the Comprehensive Environmental Response, Compensation and Liability Act of 1980 [42 USCS
§§ 9601 et seq.]; the Resource Conservation and Recovery Act of 1976 [42 USCS§§ 6901 et
seq.]; the Clean Water Act (also known as the Federal Water Pollution Control Act) [33 USCS
§§ 1251 et seq.]; the Toxic Substances Control Act [15 USCS§§ 2601 et seq.]; the Hazardous
Materials Transportation Act[49 USCS§§ 1801 et seq.] or under any other Environmental Law;
(b) Those substances listed in the United States Department of Transportation Table
[49 CFR 172.1011, or by the Environmental Protection Agency, or any successor agency, as
hazardous substances[40 CFR Part 302];
(c) Other substances, materials, and wastes that are or become regulated or classified
as hazardous or toxic under federal, state, or local laws or regulations; and
(d) Any material, waste, or substance that is:
(i) a petroleum or refined petroleum product,
(ii) asbestos,
(iii) polychlorinated biphenyl, /� er� 4 i 7
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(iv) designated as a hazardous substance pursuant to 33 USCS § 1321 or listed
pursuant to 33 USCS § 1317,
(v) a flammable explosive, or
(vi) a radioactive material.
Memorandum of Option is defined in Section 10(b).
Option Consideration is defined in Section 4.
Optionee is defined in the preamble.
Optionor is defined in the preamble.
Option Term is defined in Section 3.
Prevailing Party is defined in Section 31.
Property is defined in Recital A.
Purchase Parcel is defined in Section 11(a).
Purchase Price is defined in Section 8.
Real Property Taxes includes all real property taxes and assessments, general, special,
ordinary, or extraordinary, and improvement bond or bonds on the Property. Optionee has
received a copy of a current tax bill for the Property.
Title Company is defined in Section 4(b).
Section 2. Grant of Option.
Optionor grants to Optionee the exclusive option to purchase the Property on the terms
and conditions in this Option Agreement.
Section 3. Term of Option.
The tern of this option (Option Term) shall commence on the Execution Date and shall
expire or terminate on the earliest of the following dates:
(a) December 31, 2002, unless Optionee performs in a timely manner all obligations
required by Optionee for the timely Consummation of the Option pursuant to Section 10;
(b) The date on which a breach or default by Optionee remains uncured following
notice of the breach or default given in accordance with Section 26(b) and the expiration of the
grace period contained in that Section; or
(c) The date that Optionee acquires the entirety of the Property;
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(d) Immediately upon a breach or default by Optionee under Section 26(a).
Section 4. Consideration for Option.
As consideration for the option granted under this Agreement, Optionee agrees to pay to
Optionor the following amounts (Option Consideration):
(a) Concurrent with the execution of this Agreement, the sum of Dollars
($ ) by cashier's or certified check to Optionor;
(b) On or before [datel, the sum of Dollars ($ ) by cashier's
or certified check or wire transfer to [name of title company] (Title Company) to be held
in escrow until the Consummation of Option.
Section 5. Credit for Option Consideration.
All Option Consideration paid by Optionee shall be credited to the Purchase Price of the
Property.
Section 6. Disbursement of Option Consideration.
All Option Consideration paid to the Title Company shall be disbursed by the Title
Company to Optionor in accordance with Section 11.
Section 7. Retention of Option Consideration.
All Option Consideration paid to or for the benefit of Optionor shall belong to Optionor
and be retained by Optionor in consideration of granting this Option, whether or not Optionee
ultimately exercises Optionee's right to purchase all or a portion of the Property subject to the
rights of the Optionee under Section 5. Optionor has no duty to account to Optionee for the
Option Consideration.
Section 8. Purchase Price.
The purchase price (Purchase Price) for both parcels of the Property is One Million
Seventy Thousand Dollars ($1,070,000).
Section 9. Subdivision Compliance.
Prior to exercising the right to purchase any portion of the Property and subject to the
provisions of the last sentence of this Section, Optionee must have obtained an approved DDA in
compliance with the Community Redevelopment Law and a subdivision or parcel map approval
for the parcel to be acquired, and Optionor's obligations to convey title to any portion of the
Property are conditioned on Optionee's having obtained the subdivision or parcel map approval
in full compliance with the Subdivision Map Act [Gov C §§ 66410 et seq.]. The map and
compliance shall be Optionee's sole responsibility and at Optionee's sole expense. Optionee
shall be solely responsible for obtaining all development entitlements required under this
Agreement or desired by Optionee. Optionor shall provide reasonable and good faith
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cooperation, but Optionor's obligations in this regard shall be expressly limited to the execution
of applications and maps (parcel, tentative, and final) prepared by Optionee in connection with
the development of the Property.
Section 10. Consummation of Option.
On the parties shall consummate this Option Agreement through Title
Company. On the consummation (Consummation of the Option), the following events shall
occur:
(a) Optionee shall pay the Option Consideration required pursuant to Section 4(b)
and all other charges provided in this Agreement that are then due from Optionee.
(b) The parties shall execute in recordable form and deliver to Title Company the
Memorandum of Option (Memorandum of Option) in the form of attached Exhibit B,
incorporated in this Agreement.
(c) The escrow fees shall be paid solely by Optionee.
(d) The Title Company shall pay to Optionor the Option Consideration deposited by
Optionee, less any charges or deductions provided by this Agreement which are then due from
Optionor or authorized in writing by Optionor to be deducted from the Option Consideration.
(e) Optionee shall deliver to Optionor the certificate of insurance required under
Section 18(b).
Section 11. Exercise of Option.
From and after the Consummation of the Option and provided Optionee is not then in
breach or default of the Agreement, Optionee may exercise the option to purchase all or a portion
of the Property in accordance with the following provisions. Each provision must be satisfied as
a condition to Optionee's rights under this Agreement and Optionor's obligation to convey to
Optionee any portion of the Property:
(a) Optionee shall give written notice (Exercise Notice) of the election to purchase all
or a portion of the Property to Optionor and the Title Company. The Exercise Notice shall
specify the parcel to be purchased (Purchase Parcel) and the date on which Offence desires to
close the purchase (Closing Date). The Closing Date shall be not less than ten (10) days after all
of the conditions of this Section have been satisfied.
(b) Optionee shall obtain approval of the DDA pursuant to the Community
Redevelopment Law and a parcel map, tentative or final, allowing the conveyance of the
Purchase Parcel in compliance with the Subdivision Map Act in accordance with Section 9.
(c) Optioner shall have obtained a release of the leasehold interest incumbering one
of the parcels of the Property.
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(d) On or before the Closing Date, Optionee shall pay and deliver to the Title
Company in escrow, by cashier's or certified check or wire transfer, the Purchase Price for the
Purchase Parcel to be acquired, provided Optionee shall receive credit for previously paid Option
Consideration in accordance with Section 5 that has not been previously credited.
Section 12. Acreage.
Optionor makes no representation, express or implied, regarding the Gross Acreage of the
Property. The Gross Acreage shall be detennined in accordance with the survey to be conducted
pursuant to Section 17.
Section 13. Closing of the Purchase of Parcels.
Provided the Title Company has received the Purchase Price from Optionee and the Title
Company is in a position to issue the title insurance policy as described in this Agreement, the
purchase of each Purchase Parcel shall be closed on the Closing Date pursuant to the escrow
instructions provided in the DDA which shall have been approved prior to the exercise of the
Option.
Section 14. Title Insurance; Possession.
(a) Title Insurance. As soon as possible after the Closing Date, Optionor shall cause
the Title Company to issue to Optionee title insurance as provided by the DDA.
(b) Possession. Optionor shall deliver possession of the property to Optionee on the
Closing Date.
Section 15. Development of Property.
(a) Governmental Approvals. Optionee agrees that exercise of the option is subject
to the parties executing a DDA with a proposed development agreement and potential
community facilities district formation, all subject to the rules, regulations, standards, and criteria
set forth in the Redevelopment Plan, the City's General Plan, applicable zoning regulations and
with this Agreement. The provisions of this Option may be superceded by and incorporated
within the DDA.
(b) Optionee's Right to Enter and Inspect. During the Option Term and prior to the
Closing Date for the purchase of a Purchase Parcel, Optionee may perform certain grading
activities in accordance with Section 19(b) and reasonable tests, engineering studies, surveys,
soil and environmental tests, and other inspections, studies, and tests as Optionee may deem
necessary, at Optionce's expense. Optionee will defend, indemnify, and hold Optionor harmless
from any claim, loss, or liability in connection with any entry by Optionee, and any claim of lien
or damage arising out of all activities by Optionee, Optionee's agents and employees, and
independent contractors. Optionee will be solely responsible for all costs incurred in connection
with these activities or Optionee's investigation of the Property. If the transaction does not close
for any reason other than the breach of this Agreement by Optionor, Optionor will not be
responsible for reimbursing Optionee for any expenses. Optionee shall obtain a public liability
insurance policy for at least One Million Dollars ($1,000,000). A current certificate evidencing
IRV 922743 V2 -6- a ra `(, ■
the insurance that names Optionor as an additional insured shall be delivered to Optionor on
Consummation of the Option. The certificate shall provide that the policy shall not be canceled
without at least fifteen (15) days' prior notice to Optionor. This policy or a renewal or
replacement of this policy shall remain in effect during the entire Option Term. Optionee shall
keep the Property free of all mechanic's or similar liens in connection with all activities by or on
behalf of Optionee in connection with the Property. Optionor shall also be entitled to record and
post notices of nonresponsibility for any activities of Optionee in connection with the Property.
(b) Negation of Agency or Partnership. Optionor's agreement to cooperate with
Optionee in connection with Optionee's development of the Property and any other provision of
this Agreement shall not be construed as making either party an agent or partner of the other
party.
(c) Work Product to Optionor. If for any reason Optionee does not acquire all of the
Property, Optionee shall deliver to Optionor the entire written work product, except that which is
subject to a recognized legal privilege, pertaining to the development and improvement of the
remaining Property not acquired by Optionee. The work product includes all drawings, tests,
supporting data, and plans or studies that Optionee owns or controls. Optionor will be entitled to
receive and retain the work product at no cost.
Section 16. Planning of Development; Other Property.
(a) No Obligation for Approvals. Optionor shall be under no obligation to Optionee
to approve the DDA, development agreement, connnunity facilities district or obtain rezonings
for Optionee's benefit. Optionee shall enter into this Agreement and shall acquire each Purchase
Parcel, if any, solely on the basis of Optionee's own investigation and not in reliance on any
representations by Optionor or Optionor's agents that are not contained in this Agreement.
Section 17. Optionor's Representations and Warranties.
(a) A leasehold interest currently encumbers one of the parcels of the property.
Optionee acknowledges that removal of that encumbrance is subject to negotiation and that
Optionor has not agreed to provide funds to insure its removal.
(b) To the best of Optionor's knowledge, there are not presently any actions, suits, or
proceedings pending or, to the best of Optionor's knowledge, threatened against or affecting the
Property or the interest of Optionor in the Property or its use or that would affect Optionor's
ability to consummate the transaction contemplated in this Agreement. Further, there are not any
outstanding and unpaid arbitration awards or judgments affecting title to any portion of the
Property, and Optionor shall promptly notify Optionee of any of these matters arising in the
future.
(c) To the best of Optionor's knowledge, there are not presently any pending or
threatened condemnation, eminent domain, or similar proceedings affecting the Property.
(d) Except as otherwise stated in this Agreement, the Property shall be purchased by
Optionee AS IS, and Optionee shall purchase the Property solely on the basis of Optionee's own
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investigation and not in reliance on any representations by Optionor or Optionor's agents that are
not contained in this Agreement.
Section IS. Optionor's Conduct Prior to Closing.
During the Option Term and until this Agreement expires or terminates, Optionor shall
comply with the following terms for Property that has not been previously purchased by and
conveyed to Optionee pursuant to this Agreement:
(a) Optionor shall pay for all labor and work performed and all material furnished at
Optionor's request or on Optionor's behalf, and there shall be no claim for which a mechanic's,
materialman's, or similar lien can be claimed by any person or firm against the Property as a
result of any act of Optionor.
(b) Optionor shall not affirmatively take any actions constituting waste of the
Property, and shall not excavate, mine, or otherwise materially alter the Property.
(c) Optionor shall not in the future enter into any lease, occupancy, tenancy, or
license agreement affecting the Property, without Optionee's prior written consent.
(d) Optionor shall not incur any obligations or liabilities or enter into any transactions
that will affect the Property after the Closing Date of any sale to Optionee, without the prior
written consent of Optionee. This consent shall not be unreasonably withheld.
Section 19. Prior Use of the Property.
Optionor warrants to Optionee that, except as provided in this Section, to the best of
Optionor's actual knowledge, no Hazardous Substances have been disposed of or released into,
on, or under the Property. This warranty is subject to the limitations that:
(a) Except as expressly provided in this Section, Optionor has not made or purported
to have made any independent investigation or testing for Hazardous Substances, has not been
present on the Property at all times, and shall only be accountable under this Agreement for any
misrepresentation as to actual, not constructive, knowledge of the Hazardous Substances, and
(b) Optionor has no knowledge as to the presence or absence of any contaminants or
Hazardous Substances in any creek or other waterway or surface water drainage across the
Property, and Optionor makes no representations or warranties as to the Property's water.
These representations and warranties are further qualified in that Optionor shall have no
liability or responsibility for any Hazardous Substances contamination or potential contamination
on the Property of which Optionee or Optionee's agents or employees have knowledge, and in
this regard, Optionee acknowledges receipt of copies of the correspondence, reports, agreements,
and other documents attached to this Agreement as Exhibit D. Optionor shall have no liability or
responsibility regarding any matters disclosed in Exhibit D, or the accuracy or current status of
those matters.
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Section 20. Representations and Warranties.
Each of the parties to this Agreement makes the following representations and warranties
to the other party:
(a) The persons who have executed this Agreement have been authorized to do so by
the party on whose behalf the party is signing. All documents to be delivered under this
Agreement will be executed by an authorized person. Each party has a good and legal right to
enter into this Agreement and to perform all covenants of that party contained in this Agreement.
(b) None of the warranties, representations, or statements made by any party in this
Agreement contain any untrue statements of material fact or omit a material fact necessary in
order to make the statements not misleading. All representations and warranties of any party
shall be true on and as of the Closing Date with the same force as though made on and as of the
Closing Date.
Section 21. Time of Essence.
Time is of the essence in the performance of this Agreement.
Section 22. Default.
(a) Optionor's Remedies For Failure to Consummate the Option. If Optionee fails to
deliver to the Title Company in a timely manner the amount specified in Section 4(b), or fails to
perform in a timely manner any obligation required to be performed by Optionee for the timely
Consummation of the Option pursuant to Section 10, this Agreement and the rights of Optionee
under this Agreement shall automatically and immediately terminate without notice, Optionor
shall retain all amounts paid pursuant to Section 4(a), and, except for any damages or injuries to
the Property caused by Optionee or Optionee's agents the recourse for which Optionor reserves
regardless of anything to the contrary in this Agreement, each party shall fully release and
discharge the other party and the other party's representatives, successors, assigns, and heirs
from all claims, demands, actions, debts, controversies, liabilities, and damages, including
without limitation, those arising out of or relating to the releasing party's rights under this
Agreement; each party further agrees never to commence, aid, prosecute, or cause to be
commenced or prosecuted against the other party or the other party's agents, representatives,
successors, assigns, or heirs any action or proceeding based directly or indirectly on any of the
previous matters; each party agrees to cooperate in recording release of Option; each party
further agrees to defend, indemnify, and hold the other party and the other party's agents,
representatives, successors, assigns, and heirs harmless against all claims, demands, actions,
debts, controversies, liabilities, and damages, including court costs and attorney fees, arising
from or related to any action or proceeding brought by or prosecuted by or on behalf of the
indemnifying party contrary to this Agreement. Each party agrees that this is a general release
and expressly waives Civil Code § 1542, which provides:
A general release does not extend to claims which the creditor does not know or expect 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. /wM_ M r r '
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(b) Optionor's Remedies Generally. Except for a failure by Optionee to perform in a
timely manner under Sections 4(b) or 10, the remedy for which is provided in Section 26(a), if
Optionee fails to pay or perform in a timely manner any other payment, duty, or obligation under
this Agreement, Optionor shall be entitled to the remedies for breach of contract that are
available under applicable law, including the remedy of specific performance, and this
Agreement and the rights of Optionee shall automatically and immediately terminate on thirty
(30) days' notice to Optionee. However, Optionee shall have the right to cure the default and
reinstate Optionee's position under this Agreement if Optionee within the thirty (30) day period
pays to Optionor the payments that Optionee has failed to make in accordance with this
Agreement, plus any accrued interest in accordance with Section 24, or in the event of defaults
not involving the nonpayment of money, Optionee commences and diligently and in good faith
cures the default.
(c) Optionee's Remedies. If Optionor fails to perforn in a timely manner any
obligation under this Agreement, Optionee shall be entitled to the remedies for breach of contract
that are available under applicable law, including without limitation, the remedy of specific
performance.
Section 23. Quitclaims.
Contemporaneously with the execution of this Agreement, Optionee shall execute in
recordable form and deliver to the Title Company the quitclaim deed covering the Property along
with escrow instructions in the form of attached Exhibits E and F, respectively. On termination
of this Agreement, the quitclaim deed shall be delivered to Optionor.
Section 24. Transfer.
No transfer of Optionee's rights under the Agreement shall be made without the prior
written consent of Optionor, which shall not be unreasonably withheld. In approving or
disapproving this transfer, Optionor shall review the financial capability and development
expertise of the proposed transferee. Optionee will provide Optionor with financial statements
and information in reasonable detail for any party to whom Optionee intends to transfer
Optionee's interest. Optionor shall not be deemed to withhold consent to a transfer unreasonably
if the proposed transferee has less financial capability or has less development expertise than
Optionee. Optionee may transfer Optionee's rights under the Agreement to another entity
without Optionor's written consent, provided Optionee remains fully responsible for
development of the Property and fully liable for all duties and obligations required of Optionee
under this Agreement. Optionee shall notify Optionor in writing of any transfer, providing the
identity of the transferee and the details of the transfer.
Section 25. Notices.
All notices, demands, requests, exercises, and other communications under this
Agreement shall be in writing and:
(! ra
IRV#22743 Q -10-
(a) sent by United States Certified Mail, return receipt requested, in which case notice
shall be deemed delivered three (3) business days after deposit, postage prepaid in the United
States Mail, or
(b) sent by a nationally recognized overnight courier, in which case notice shall be
deemed delivered one (1)business day after deposit with that courier, or
(c) sent by telecopy or similar means if a copy of the notice is also sent by United
States Certified Mail, in which case notice shall be deemed delivered on transmittal by telecopier
or other similar means, provided that a transmission report is generated by reflecting the accurate
transmission of the notices, as follows:
If to Agency: The Palm Springs Community Redevelopment Agency
P.O. Box 2743
Palm Springs, California 92263-2743
3200 Tahquitz Canyon Way
Palm Springs, California 92262
Attn: Executive Director
With a copy to: Burke, Williams & Sorensen, LLP
18301 Von Karman Avenue, Suite 1050
Irvine, California 92612
Attn: David J. Aleshire, Esq.
If to Developer:
With a copy to:
These addresses may be changed by written notice to the other party, provided that no
notice of a change of address shall be effective until actual receipt of that notice. Copies of
notices are for informational purposes only, and a failure to give or receive copies of any notice
shall not be deemed a failure to give notice.
Section 26. Waiver.
Failure of either party at any time to require performance of any provision of this
Agreement shall not limit that party's right to enforce the provision. Waiver of any breach of a
provision shall not be a waiver of any succeeding breach of the provision or a waiver of the
provision itself or of any other provision. C(a
IRV#22743 Q
_11_
Section 27. Litigation Costs.
(a) If any legal action or any other proceeding, including arbitration or an action for
declaratory relief, is brought for the enforcement of this Agreement or because of an alleged
dispute, breach, default, or misrepresentation in connection with any provision of this
Agreement, the prevailing party shall be entitled to recover reasonable attorney fees and other
costs incurred in that action or proceeding, in addition to any other relief to which the prevailing
party may be entitled.
Section 28. Integration.
This Agreement contains the entire agreement between the parties respecting the matter
set forth, and expressly supersedes all previous or contemporaneous agreements, understandings,
representations, or statements between the parties respecting this matter.
Section 29. Survival of Covenants.
Any covenants and agreements that this Agreement does not require to be fully
performed prior to the Closing Date shall survive the Closing Date and shall be fully enforceable
after the Closing Date in accordance with their terms.
Section 30. Brokers.
Each party will defend, indemnify, and hold the other party harmless from any claim,
loss, or liability made or imposed by any other party claiming a commission or fee in connection
with this transaction and arising out of that party's own conduct.
Section 31. Changes in Writing.
This Agreement and any of its terms may be changed, waived, discharged, or terminated
only by a written instrument signed by the party against whom enforcement of the change,
waiver, discharge, or termination is sought.
Section 32. Indemnified Parties.
Any indemnification contained in this Agreement for the benefit of a party shall extend to
the officers, employees, and agents of the party.
Section 33. Counterparts.
This Agreement may be executed simultaneously or in counterparts, each of which shall
be deemed an original, but all of which together shall constitute one and the same Agreement.
Section 34. Invalidity of Provisions.
If any provision of this Agreement or any instrument to be delivered by Optionee at
closing pursuant to this Agreement is declared invalid or is unenfforrceabb�lee for any reason, that
/ � � /j
IRV#22743 Q -12- ` 6 ,* 17
provision shall be deleted from the document and shall not invalidate any other provision
contained in the document.
Section 35. Successors.
This Agreement shall be binding on and inure to the benefit of the parties, and their
respective heirs, personal representatives, successors, and assigns.
Section 36. Third-Party Rights.
Nothing in this Agreement, express or implied, is intended to confer on any person, other
than the parties and their respective successors and assigns, any rights or remedies under or by
reason of this Agreement.
Section 37. Construction.
Headings at the beginning of each section and subsection are solely for the convenience
of the parties and are not a part of and shall not be used to interpret this Agreement. The singular
form shall include plural and vice versa. This Agreement shall not be construed as if it had been
prepared by one of the parties, but rather as if both parties have prepared it. Unless otherwise
indicated, all references to Sections are to this Agreement.
Section 33. Further Assurances.
Whenever requested to do so by the other party, each party shall execute, acknowledge,
and deliver all further conveyances, assignments, confirmations, satisfactions, releases, powers
of attorney, instruments of further assurance, approvals, consents, and all further instruments and
documents as may be necessary, expedient, or proper, in order to complete all conveyances,
transfers, sales, and assignments under this Agreement, and to do all other acts and to execute,
acknowledge, and deliver all documents as requested in order to carry out the intent and purpose
of this Agreement.
Section 39. Governing Law.
This Agreement shall be governed and construed in accordance with California law.
The parties have executed this Agreement as of the day and year first above written.
IRV#22743 V2 -13-
IN WITNESS WHEREOF, Optioner and Optionee have caused this instrument to be
executed on their behalf by their respective officers or agents hereunto as of the date first above
written.
OPTIONER:
THE PALM SPRINGS COMMUNITY
REDEVELOPMENT AGENCY, a public body
By:
Chairman
ATTEST:
By:
Assistant Secretary
APPROVED AS TO FORM:
BURKE, WILLIAMS & SORENSEN, LLP
By:
David J. Aleshire, Agency Counsel
OPTIONEE:
BURNETT DEVELOPMENT
CORPORATION, a California corporation
By:
Its:
By:
Its:
cra -wIg
IRV 422743 v2 -14-
STATE OF CALIFORNIA )
) ss.
COUNTY OF RIVERSIDE )
On before me, a notary public, personally appeared
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/she executed the same in his/her authorized capacity,
and that by his/her signature on the instrument the person, or the entity upon behalf of which the
person acted, executed the instrument.
WITNESS my hand and official seal.
By:
STATE OF CALIFORNIA )
) ss.
COUNTY OF RIVERSIDE )
On before me, a notary public, personally appeared
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/she executed the same in his/her authorized capacity,
and that by his/her signature on the instrument the person, or the entity upon behalf of which the
person acted, executed the instrument.
WITNESS my hand and official seal.
By:
r&- ►- Zo
IRV#22743 Q -15-
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Recording
Requested by and
After Recording
Return to:
City Clerk
City of Palm Springs
Box 2743
Palm Springs, CA 92263 (FOR RECORDERS USE ONLYI
File No.R-02-018 NO DOCUMENTARY STAMPS NEEDED
GRANT OF EASEMENT
For a valuable consideration, receipt of which is hereby acknowledged, the COMMUNITY REDEVELOPMENT
AGENCY OF THE CITY OF PALM SPRINGS, CALIFORNIA, a public body, corporate and politic, herein
called"Grantor," hereby grants to the CITY OF PALM SPRINGS, A MUNICIPAL CORPORATION, a Charter
City, herein called "Grantee," an easement for underground sewers and other appurtenant uses, together with
the right to construct, maintain, repair, operate, use, dedicate or declare the same for public use, in, on, under,
over and across the real property in the City of Palm Springs, County of Riverside, State of California, described
as follows:
Being over the land described in Exhibit "A" and shown on Exhibit "B" attached hereto and made a part hereof.
GRANTOR:
ATTEST: COMMUNITY REDEVELOPMENT AGENCY
OF THE CITY OF PALM SPRINGS,
CALIFORNIA, a public body, corporate and politic
By: By:
Assistant Secretary Executive Director
e r& - &-u�
ALL-PURPOSE ACKNOWLEDGMENT
State of CAPACITY CLAIMED BY SIGNER
County of ❑ INDIVIDUAL(S)
❑ CORPORATE
On before me, OFFICER(S)
Date Name, Title of Officer TITLE(S)
personally appeared ❑ PARTNER(S)
NAME(S) OF SIGNER(S) ❑ ATTORNEY-IN-FACT
❑ TRUSTEE(S)
❑personally known to me- OR- ❑proved to me on the basis of satisfactory evidence ❑ SUBSCRIBING WITNESS
to be the persons(s) whose name(s) is/are subscribed ❑ GUARDIAN/CONSERVATOR
to the within instrument and acknowledged to me ❑ OTHER
that he/slte/they executed the same in his/her/their
authorized eapacity(ies), and that by his/her/their
signatnre(s) on the instrument the person(s) or the
entity upon behalf of which the persons(s) acted, SIGNER IS REPRESENTING:
executed the instrument.
Witness my hand and official seal.
Signature of Notary
ATTENTION NOTARY: Although the information requested below is OPTIONAL, it could prevent fraudulent attachment of this
certificate to unauthorized document
THIS CERTIFICATE Title or Type of Document
MUST BE ATTACHED
TO THE DOCUMENT Number of Pages DATE of DOCUMENT
DESCRIBED AT RIGHT:
Signer(s) Other Than Named Above
EXHIBIT "A"
EASEMENTS 15.00 FEET IN WIDTH, IN THE CITY OF PALM SPRINGS CALIFORNIA,
FOR THE CONSTRUCTION AND MAINTENANCE OF SEWER MAINS, THE CENTER LINES
OF WHICH ARE DESCRIBED AS FOLLOWS
EASEMENT "A"
COMMENCING AT THE CENTER LINE INTERSECTION OF SAN RAFAEL ROAD AND
MOUNTAIN SHADOW DRIVE, AS SHOWN BY MAP OF TRACT NO. 17642-2 ON FILE
IN BOOK 124 PAGES 27 AND 28 OF MAPS IN THE OFFICE OF THE RECORDER OF THE
COUNTY OF RIVERSIDE, CALIFORNIA;
THENCE NORTH 890 46' 28" WEST 153.56 FEET ALONG THE CENTER LINE OF SAID
SAN RAFAEL ROAD;
THENCE NORTH 000 15' 14" EAST 44.00 FEET TO THE SOUTHERLY LINE OF LOT 1 OF
TRACT NO. 17642-1 AS SHOWN BY MAP ON FILE IN BOOK 122 PAGES 88, 89 AND 90
OF MAPS IN THE OFFICE OF THE RECORDER OF SAID COUNTY, AND THE POINT OF
BEGINNING;
THENCE NORTH 000 15' 14" EAST 85.00 FEET PARALLEL WITH THE EASTERLY LINE
OF SAID LOT 1;
THENCE NORTH 170 12' 39" WEST 65.03 FEET;
THENCE NORTH 000 15' 14" EAST 635.00 FEET PARALLEL WITH SAID EASTERLY LINE
AND THE TERMINATION OF SAID EASEMENT.
EASEMENT "B"
COMMENCING AT THE CENTER LINE INTERSECTION OF SAN RAFAEL ROAD AND
MOUNTAIN SHADOW DRIVE, AS SHOWN BY MAP OF TRACT NO. 17642-2 ON FILE
IN BOOK 124 PAGES 27 AND 28 OF MAPS IN THE OFFICE OF THE RECORDER OF
RIVERSIDE COUNTY, CALIFORNIA;
THENCE NORTH 890 46' 28" WEST 691.24 FEET ALONG THE CENTER LINE OF SAID
SAN RAFAEL ROAD;
THENCE NORTH 000 43' 30" EAST 44.00 FEET TO THE SOUTHERLY LINE OF LOT 1 OF
TRACT NO. 17642-1 AS SHOWN BY MAP ON FILE IN BOOK 122 PAGES 88, 89 AND 90
OF MAPS IN THE OFFICE OF THE RECORDER OF SAID COUNTY AND THE POINT OF
BEGINNING;
THENCE CONTINUING NORTH 000 43' 30" EAST 745.00 FEET TO THE TERMINATION
OF SAID EASEMENT.
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FILE NO.:
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EXHIBIT "B"
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DEPARTMENT Q
DESIGN BY: SCALE: FILE NO..
N. T. S. R-02- 0/8
CHECKED BY: W.O. Y SHEET NO.:
2OF2
RESOLUTION NO.
OF THE COMMUNITY REDEVELOPMENT AGENCY
OF THE CITY OF PALM SPRINGS, CALIFORNIA,
APPROVING AN OPTION AGREEMENT WITH
BURNETT COMPANIES OF NEWPORT BEACH,
CALIFORNIA FOR THE PURCHASE AND
DEVELOPMENT OF TWO AGENCY-OWNED
PARCELS TO FACILITATE THE DEVELOPMENT OF
A SINGLE-FAMILY HOME DEVELOPMENT IN AND
NEAR MERGED PROJECT AREA #1 (FORMERLY
PROJECT AREA#9-C)
WHEREAS, the Community Redevelopment Agency of the City of Palm Springs,
California ("Agency") is constituted under the Community Redevelopment Law
(California Health and Safety Code Section 33000 et, seq.) to carry out the purpose of
redevelopment in the City of Palm Springs ("the City"); and
WHEREAS the Agency does own a parcel of land of approximately 40 acres adjacent to
Project Area#1, formerly known as the Project Area#9-C, which is divided between a
mobile home park and a 19.17+ acre vacant parcel, which it acquired from the City of
Palm Springs in 1995; and
WHEREAS the City of Palm Springs conveyed its 22.21 acre parcel to the Agency to
facilitate the development of the combined 41.38+ acre parcel with market rate housing
to ensure a demographic balance in the area; and
WHEREAS a number of developments have been constructed on the entire 100 acre
City-owned parcel which have restrictive covenants on them to preserve affordability,
including the mobile home park, Coyote Run, and Sunrise Norte; and
WHEREAS the Agency desires to sell the two parcels to Burnett Companies so that it
can return the land to productive use and facilitate additional development in the area
around the site, including the generation of property taxes; and
WHEREAS, Section 33430 of the Community Redevelopment Law allows that an
agency may, "for purposes of redevelopment, sell, lease, for a period not to exceed 99
years, exchange, subdivide, transfer, assign, pledge, encumber by mortgage, deed of
trust, or otherwise, or otherwise dispose of any real or personal property or any interest
in property;" and
NOW, THEREFORE, BE IT RESOLVED by the Community Redevelopment Agency of
the City of Palm Springs as follows:
SECTION 1. The Option Agreement between the Community Redevelopment
Agency and Burnett Development Company is hereby approved
and incorporated herein by this reference.
SECTION 2. The Lot Line Adjustment combining the 19.17 acre parcel and the
22.21 acre parcel is hereby approved, portions of Lot 1 of Tract
17642-1 in the City of Palm Springs, County of Riverside, State of
California, and owned by the Community Redevelopment Agency,
(! r,r,6 _s
subject to the release of the leasehold interest in the 19.17 acre
parcel by the current Lessee.
SECTION 3. The Grant of Easement for underground sewers and other
purposes, is hereby approved.
SECTION 4. The Chairman, or his designee, is hereby authorized to execute
on behalf of the Agency the Option Agreement and other
documents necessary to the Agreement, and make minor
changes as may be deemed necessary, in a form approved by
Agency Counsel.
ADOPTED this day of 2002.
AYES:
NOES:
ABSENT:
ATTEST: COMMUNITY REDEVELOPMENT AGENCY
OF THE CITY OF PALM SPRINGS, CALIFORNIA
By
Assistant Secretary Executive Director
REVIEWED & APPROVED AS TO FORM
RESOLUTION NO.
OF THE COMMUNITY REDEVELOPMENT
AGENCY OF THE CITY OF PALM SPRINGS,
CALIFORNIA, APPROVING A LOT LINE
ADJUSTMENT BETWEEN PORTIONS OF LOT 1
OF TRACT 17642-1 IN THE CITY OF PALM
SPRINGS, OWNED BY THE COMMUNITY
REDEVELOPMENT AGENCY
BE IT RESOLVED BY THE COMMUNITY REDEVELOPMENT AGENCY of the City of
Palm Springs, California, that a Lot Line Adjustment between portions of Lot 1 of Tract
17642-1 in the City of Palm Springs, owned by the Community Redevelopment Agency,
in a form acceptable to the Agency Counsel, is approved.
ADOPTED this day of 2002.
AYES:
NOES:
ABSENT:
ATTEST: COMMUNITY REDEVELOPMENT AGENCY
OF THE CITY OF PALM SPRINGS, CALIFORNIA
By
Assistant Secretary Chairman
REVIEWED &APPROVED AS TO FORM
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CITY OF PALM SPRINGS
DEPARTMENT OF PUBLIC WORKS ENGINEERING DIVISION
LOT LINE ADJUSTMENT
LEGAL DESCRIPTION PB9.3l
LOT 1, A PORTION OF LOT 9 AND A POW10N CITY ENGINEER R,C,E.
OF IpP "C", PER TRACT NO. 17642-1, M.B. DESIGN BY SCALE FILE NO.
122/88-90 AND TRACP NO. 26943-1, P a. /W=moo' LLA 99-/2
M.B. 235/84-85. CHECKED BY SHEET NO.
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