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Home My WebLink AboutCC RES 2018-30RESOLUTION NO. 2018-30 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PALM DESERT APPROVING AN ASSIGNMENT AND ASSUMPTION AGREEMENT BETWEEN THE CITY AND THE SUCCESSOR AGENCY TO THE PALM DESERT REDEVELOPMENT AGENCY PERTAINING TO THE SUCCESSOR AGENCY'S ASSIGNMENT OF INTERESTS AND OBLIGATIONS UNDER A DISPOSITION AND DEVELOPMENT AGREEMENT AND RELATED DOCUMENTS FOR THE MCCALLUM THEATRE PROPERTY AND TAKING OTHER RELATED ACTIONS RECITALS: A. The McCallum Theatre (the "Theatre"), located at 73-000 Fred Waring Drive (the "Property"), is an important performing arts and cultural venue in the City of Palm Desert (the "City") and the Coachella Valley region; and B. The Theatre is operated by Friends of the Cultural Center, Inc., a California nonprofit public benefit corporation (the "Center"); and C. The Property is located within one of the project areas of the former Palm Desert Redevelopment Agency (the "Former Agency"), designated Project Area No. 1, As Amended (the "Project Area"); and D. Having determined that the continued operation of the Theatre at its present location would assist in the revitalization of the Project Area, encourage private sector investment and create employment opportunities in the Project Area, in 2001, the Former Agency entered into agreements with the Center and executed related documents (collectively, the "Theatre Documents"); and E. Among the Theatre Documents are a Disposition and Development Agreement, dated as of June 28, 2011, an Amendment and Assignment of Ground Lease, dated as of July 26, 2001, a Lease, dated as of July 26, 2001 (the "Lease") and a Sublease, dated as of July 26, 2001 (the "Sublease"); and F. Pursuant the Theatre Documents, the Former Agency assumed responsibilities as the tenant under the Lease, and the Center agreed to pay rent of $1.00 per year as the subtenant under the Sublease; and G. The Theatre Documents serve to ensure that a performance arts facility would remain at the Property — to serve the Project Area, the City and the region — until March 1, 2049, the end of the term of the Lease and Sublease; and H. The Theatre Documents remain in the effect and bind the Successor Agency to the Palm Desert Redevelopment Agency (the "Successor Agency") as the successor to the Former Agency. G \rdiaeronica'I'apia\Word Files\Staff Reports\Successor Agenc}\Palm Desert - Cm Council reso re McCallum Theatre assignment 5-24- 18.docx RESOLUTION NO. 2018-30 I. In furtherance of the Successor Agency's task to wind -down the Former Agency's affairs, there has been prepared the form of an Assignment and Assumption Agreement (the "Assignment Agreement"), to be entered into by the Successor Agency and the City, whereby the Successor Agency will assign all of its obligations, rights and interests under the Theatre Documents to the City, in consideration for the City's payment of $50.00; and J. Pursuant to Section 34181(e), upon the direction of the Oversight Board of the Successor Agency, the Successor Agency may terminate its participation in an arrangement with any private party if such termination would reduce liability and increase revenues to taxing entities and would be in the best interests of the taxing entities; and K. The assignment of the Successor Agency's interests under the Theatre Documents to the City and the implementation of the Assignment Agreement are an effective way to: (i) terminate the Successor Agency's liabilities and obligations under the Theatre Documents and (ii) continue to ensure that the Theatre would remain at the Property to serve its function as an important performance arts and cultural center for the City and the region -- thereby encouraging private sector investment, creating employment opportunities in the Project Area, and increasing revenues to the taxing entities of the Project Area; NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF PALM DESERT DOES HEREBY RESOLVE, DETERMINE AND ORDER AS FOLLOWS: Section 1. Recitals. The above recitals are true and correct and are a substantive part of this Resolution. Section 2. Assignment Agreement. The Assignment Agreement, in the form attached hereto as Exhibit A, is hereby approved. The Mayor (or in the Mayor's absence, the Mayor Pro Tem) is hereby authorized to execute and deliver, for and in the name of the City, the Assignment Agreement, in substantially such form, with changes therein as the Mayor (or the Mayor Pro Tem, as the case may be) may approve (such approval to be conclusively evidenced by the execution and delivery thereof). Section 3. Other Acts. The officers and Staff of the City are hereby authorized, jointly and severally, to do all things (including but not limited to the execution of any certificates or other instruments) which they may deem necessary or proper to effectuate the purposes of this Resolution and the Assignment Agreement, and consummate the assignment and assumption thereunder, and any such actions previously taken are hereby ratified and confirmed. -2- G:\rda''Veronica Tapia\Word Files \Staff Reports\Successor Agency\Palm Desert - City Council reso re McCallum Theatre assignment 5-24- 8.docx RESOLUTION NO. 2018-30 PASSED, APPROVED and ADOPTED this 24th day of May, 2018. AYES: HARNIK, KELLY, NESTANDE, WEBER, and JONATHAN NOES: NONE ABSENT: NONE ABSTAIN: NONE SAB ,JONATHAN, MAYOR ATTEST: KLA SE , CITY CLERK CITY OF PALM DESERT, CALIFORNIA -3- G:\rda\Veronica Tapia '\Word Files\Stan Reports` Successor Agency\Palm Desert - Cit Council rest) re McCallum Theatre assignment 5-24- 18.docx RESOLUTION NO. 2018-30 [This page has intentionally been left blank.] EXHIBIT A ASSIGNMENT AND ASSUMPTION AGREEMENT (substantial final form) (i:\rda\Veronica Tapia\Word Fdes\Stafl Reports\Successor Agency\Palm Desert - City Council reso re McCallum Theatre assignment 5-24- 18.doex RESOLUTION NO. 2018-30 [This page has intentionally been left blank.] RESOLUTION NO. 2018-30 RECORDING REQUESTED BY: City of Palm Desert 73-510 Fred Waring Drive Palm Desert. CA 92660 And when recorded return to: City of Palm Desert 73-510 Fred Waring Drive Palm Desert. CA 92660 Attn: City Manager With a copy to: Richards. Watson & Gershon 355 S. Grand Ave., 40th Floor Los Angeles. ('A 90071 Attn: Jim G. Grayson. Esq. .-1801 'E TIUS L/.V HE? RE(Y)R1)ER .S l Sh: This Assignment and Assumption Agreement is exempt from Recording Fees pursuant to California Government Code Sections 6103 and 27383 ASSIGNMENT AND ASSUMPTION AGREEMENT (McCallum Theatre) This ASSIGNMENT AND ASSUMPTION AGREEMENT (the "Agreement"), is dated as of . 2018. and is entered into by and between the SUCCESSOR AGENCY TO TI IE PALM DESERT REDEVELOPMENT AGENCY (the "Successor Agency"). and the CITY OF PALM DESERT. a California municipal corporation (the "City"). RECITALS A. The former Palm Desert Redevelopment Agency (the "Former Agency"), Friends ofthe Cultural ('enter. Inc. (the "Center"), McCallum Theatre Foundation, Inc. (the "Foundation"). and Desert Community College District (the "College"), entered into that certain Disposition and Development Agreement. dated as of June 28. 2001 and pertaining to that certain property described in Exhibit A attached hereto (the "DDA"). B. Pursuant to the DDA. the Former Agency was assigned and assumed certain of the rights and obligations of the Center in that certain ground lease by and between the College and the Center dated as of March 2, 1983 (as amended, the "Ground Lease") pursuant to that certain Amendment and Assignment of Ground Lease among the College, the Former Agency and the Center, and dated as of July 26. 2001 (and as described in that certain Memorandum of Assignment. Lease and Sublease dated July 26, 2001 and recorded as document 2001-347794 in the official records of the County of Riverside) (the "Assignment"). (i %rda'.yeronica I apia`Word Files Staff Reports Successor Agent: Assignment and Assumption Agreement - SA to Clth Palm Desert - h1eC'allunt docx RESOLUTION NO. 2018-30 C. Pursuant to the DI)A, the Center and the Former Agency entered into that certain Lease with the Center, dated as of July 26, 2001 (the "Lease"). D. Pursuant to the DDA, the Former Agency entered into that certain Sublease with the Center, dated as of July 26, 2001 (the "Sublease"). E. Pursuant to AB X1 26 (enacted in June 2011, as modified by the California Supreme Court's decision in California Redevelopment Association, et al. v. Ana Matosantos, et al., 53 Ca1.4111 231(2011) ("Matosantos"), the Former Agency was dissolved as of February 1, 2012, the Successor Agency was established, and an oversight board to the Successor Agency was established. F. Pursuant to California Health and Safety Code (`'HSC") Section 34175(b) and the California Supreme Court's decision in Matosantos, on February 1, 2012, properties of the Former Agency transferred to the control of the Successor Agency by operation of law. including the Former Agency's rights and obligations under the DDA, the Ground Lease, the Lease and the Sublease. and all other documents pertaining to and executed by the Former Agency in connection therewith. NOW, THEREFORE, for and in consideration of the following agreements of the parties hereto and the payment of Fifty Dollars ($50.00) by the City to the Successor Agency, the receipt of which is hereby acknowledged by the Successor Agency. the City and the Successor Agency hereby agree as follows: AGREEMENT 1. Assignment. As of the date hereof, the Successor Agency assigns to the City: (i) all of the Successor Agency's rights and interests in, under and to the DDA, the Ground Lease, the Lease, and the Sublease, and all other documents pertaining to and executed by the Former Agency in connection therewith; and (ii) all of the Successor Agency's obligations under the documents described in (i) above arising after the date hereof; it being agreed among the parties hereto that the Successor Agency shall retain the obligations or liability under such documents that arose prior to the date hereof. 2. Assumption. As of the date hereof, the City accepts the assignment of the Successor Agency's rights, interests in, under and to the DDA, the Ground Lease, the Lease and the Sublease, and all other documents pertaining to and executed by the Former Agency in connection therewith as described in Section 1(i), and assumes the obligations of Successor Agency thereunder arising after the date hereof. 3. Governing Law. This Agreement shall be governed by, and construed in accordance with, the laws of the State of California. 4. Further Assurances. The parties hereto hereby agree to execute such other documents and perform such other acts as may be necessary or desirable to carry out the purposes of this Agreement. 5. Successors and Assigns. This Agreement shall inure to the benefit of, and be binding upon. the parties hereto and their respective successors and permitted assigns. G-\rda''Veronica Tapia\Word Piles\Staff Reports\Successor Agency\Assignment and Assumption Agreement - SA to City Palm Desert - McCallum docx-2- 11.4111 RESOLUTION NO. 2018-30 6. Attornevs' Fees. Should any action be brought arising out of this Agreement. including. without limitation. any action for declaratory or injunctive relief, each party shall hear their own attorneys' fees and costs and expenses of investigation as may be incurred. IN WITNESS WHEREOF. the parties hereto have entered into this Agreement as of the date first set forth above. SUCCESSOR AGENCY: SUCCESSOR AGENCY TO TI IE REDEVELOPMENT AGENCY OF 'HIE CITY OF PALM DESERT 13y: Lauri Avlaian, Executive Director CITY: CITY OF PALM DESERT, a California municipal corporation Sabby Jonathan. Mayor Attest: Rachelle I). Klassen. City Clerk APPROVED AS TO FORM: RICIIARDS. WATSON & GERSIION. A Professional Corporation Ry: Jim Grayson Special Counsel to the Successor Agency G rda yerontca'1 apia`Vs ord Files `Staff Reports Successor ,\Rena' Assignment and Assumption Agreement - SA to Clt. Palm Desert - McCallum doc�-J- RESOLUTION NO. 2018-30 CONSENT TO ASSIGNMENT The Center, the Foundation and the College do hereby consent to the assignment of the interests and obligations of the Successor Agency to the City as described in the Agreement to which this consent is attached. CENTER: Friends of the Cultural Center, Inc. By: Name: Title: Mitch Gershenfeld President and Chief Executive Officer FOUNDATION: McCallum Theatre Foundation By: Name: Harold Matzner Title: Chairman By: Name: Mitch Gershenfeld Title: President and Chief Executive Officer COLLEGE: Desert Community College District By: Name: Aurora Wilson Title: Board Chair G .rda'.Veronica Tapia\Word Files Staff Reports`Successor Aaenc.x Assisnment and Assumption Agreement - SA to Cm Palm Desert - McCallum docx RESOLUTION NO. 2018-30 EXHIBIT "A" LEGAL DESCRIPTION OF PROPERTY THAT PORTION OF "I'HE SOUTHWEST QUARTER OF SECTION 17, TOWNSHIP 5 SOUTH, RANGE 6 EAST. SAN BERNARDINO BASE AND MERIDIAN. IN THE CITY OF PALM DESERT, COUNTY OF RIVERSIDE. STATE OF CALIFORNIA. DESCRIBED AS FOLLOWS: BEGINNING AT THE SOUTHWESTERLY CORNER OF SECTION 17. TOWNSHIP 5 SOUTH. RANGE 6 EAST AND: THENCE ALONG TIIE WESTERLY LINE OF SAID SECTION NORTH 0° 02' 27" EAST. 1038.00 FEET: THENCE SOUTH 89° 57' 33" EAST, 55.00 FEET TO THE TRUE POINT OF BEGINNING: THENCE SOUTH 89° 57' 33" EAST, 325.00 FEET TO A RADIAL POINT AT THE BEGINNING OF A CURVE CONCAVE NORTHEASTERLY IIAVING A RADIUS OF 200.00 FEU; ALONG SAIL) CURVE THROUGH AN ANGLE OF 90° 06' 33-, AN ARC DISTANCE. OF 314.54 FEET TO A RADIAL POINT AT TIIE END OF SAID CURVE: THENCE. SOUTH 0° 09' 00" EAST. 98.24 FEET: THENCE NORTH 89° 51' 00" EAST. 216.77 FEET; THENCE SOUTH 0° 09' 00" EAST. 270.00 FEET; TI IENC E NORTI 189° 51' 00" EAST. 275.00 FEET: THENCE SOUTH 0° 09' 00" EAST, TO INTERSECT WITH A LINE PARALLEI. 10 AND 68.00 FEET NORTH OF TIIE SOUTHERLY LINE OF SECTION 17; THENCE ALONG SAID LINE SOUTH 89° 51' 00" WEST, 999.93 FEET TO A RAI)IAI. POINT AT 'TIIE BEGINNING OF A CURVE CONCAVE NORTT-IEASTERLY IIAVING A RADIUS OF 20.00 FEET; ALONG SAID CURVE 'TI IROUGH AN ANGLE OF 90° 11' 27". AN ARC DISTANCE OF 31.48 TO A POINT RADIAI. TO A LINE PARALLEL WITH AND 55.00 FEL I EAST OF THE WESTERLY LINE OF SECTION 17: TT IENC E ALONG SAID LINE TO TIIE TRUE POINT ()F BEGINNING. G rda \'cromea l apia'\1'ord Files'Staff Reports Sucecssor Agcnc% Assignment and Assumption :kmeemcnt - S:\ to (lh Palm Desert - McCallum doc