HomeMy WebLinkAboutRes 06-31 and RDA 520 CV Food Service - Inc. - La Spiga DDACITY OF PALM DESERT/PALM DESERT REDEVELOPMENT AGENCY
STAFF REPORT
REQUEST: APPROVAL OF DISPOSITION AND DEVELOPMENT
AGREEMENT BETWEEN PALM DESERT REDEVELOPMENT
AGENCY AND C V FOOD SERVICE, INC., D.B.A. LA SPIGA AND
SUMMARY REPORT
SUBMITTED BY: LAURI AYLAIAN, REDEVELOPMENT MANAGER
DEVELOPER: C V FOOD SERVICE, INC.
73-405 EL PASEO
PALM DESERT CA 92260
DATE: MARCH 9, 2006
CONTENTS: CITY RESOLUTION NO. 06- 31
AGENCY RESOLUTION NO. 520
REASCO SECTION 33433 REPORT DATED
DISPOSITION AND DEVELOPMENT AGREEMENT
Recommendation:
That the City Council and the Agency Board open the joint public hearing and
following testimony take the following actions:
1. That the City Council adopt Resolution No. 06- 31 , a resolution of the City
of Palm Desert approving the sale by the Palm Desert Redevelopment
Agency to C V Food Service, Inc., of approximately 0.53 acres of real
property on a parcel located between Painter's Path, Highway 111, the
Palm Valley Storm Channel, and west El Paseo.
2. That the Agency Board adopt Resolution No. 520, a resolution of the Palm
Desert Redevelopment Agency approving the sale to C V Food Service,
Inc., of approximately 0.53 acres of real property on a parcel located
between Painter's Path, Highway 111, the Palm Valley Storm Channel, and
west El Paseo.
Discussion:
This report summarizes the terms and conditions of that certain Disposition and
Development Agreement (the "DDA") between the Palm Desert Redevelopment Agency
(the "Agency") and C V Food Service, Inc. (the "Developer") concerning the proposed
sale of certain real property by the Agency to C V Food Service, Inc. The report is
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created to comply with requirements of California Health and Safety Code Section
33433.
A. Summary of the DDA
The Agency is the owner of certain real property in the City of Palm Desert bounded
by Highway 111, west El Paseo, Painter's Path and the Palm Valley Storm Channel
known as Entrada del Paseo. Such property is generally described in Tract Map No.
30226. The Agency has developed, or has caused to be developed, a Visitor's
Information Center, botanical gardens, a fine dining French restaurant, and related
amenities. The Redevelopment Agency also plans to develop a community use
building and additional botanical gardens at this site. The property proposed for sale
to C V Food Service, Inc. is currently unimproved and is bounded on the north by
Highway 111 and an unimproved property on which the community use building will
be built, and on the south by the residential area known as Sandpiper
Condominiums, and on the east and west by commercial development. The
development of the property described below will eliminate blight conditions.
B. The Subiect Proiect
The Agency proposes to sell to C V Food Service, Inc. approximately .53 acres in
the west corner of the development identified by Tract Map No. 30226. C V Food
Service, Inc. proposes to develop an Italian restaurant approximately 4,500 square
feet in size with an outdoor patio for dining and outdoor gardens encircled by a wall
in which private catered events may be held. The real property contained in this
description is referred to as the "Subject Property".
1. Purchase of the Subiect Pror)ertv. The Purchase Price for the Subject Property
shall be $750,000 or $32.50 per square foot. The Terms shall be all cash due
upon close of escrow with a $25,000 deposit upon opening of escrow.
2. Obligations of Aqencv. The Agency/City will be obligated to construct a building
pad for the proposed restaurant and to extend water, sewer, electric, gas and
telephone utilities to the parcel boundary. The Agency/City will also be
obligated to construct parking and landscaping around the parcel, and to
maintain the area between the subject parcel and the planned Henderson
Community Building as a use compatible with the proposed restaurant. For the
purposes of the agreement, compatible uses include Class A office space, an
art gallery, high -end boutique retail, or open space.
3. Obligations of Developer. The Developer will be obligated to construct a fine
dining restaurant featuring Italian cuisine and to maintain that use for a
minimum of twenty years. The restaurant is required to be open for a minimum
of five days per week for dinner, eight and one half months per year. The
Developer will also be required to pay common area maintenance fees for the
landscape and parking lot prorated on the basis of the number of parking
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spaces used by the Developer. The Developer will be opened for business by
January 1, 2008, or face a penalty for such non -opening of $250 per day.
4. Financial Analvsis of the DDA. Attached hereto as Exhibit 1 is the financial
analysis of this transaction performed by Real Estate Analysis Services
Company (REASCO). Such analysis is hereby incorporated by reference.
Submitted by:
Lauri �Aylaian �---
Redevelopment Manager
mh
Approval:
lopment
Manager/Exec. Dir.
Department Head:
,/I'- DpWYrigo en
—Director of evelopment/Housing
Paul S
actor of Finance
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RESOLUTION NO. 06-
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PALM DESERT
APPROVING THE SALE BY THE PALM DESERT REDEVELOPMENT
AGENCY OF CERTAIN REAL PROPERTY CONSISTING OF
APPROXIMATELY 0.53 ACRES ON A PARCEL LOCATED BETWEEN
PAINTER’S PATH, HIGHWAY 111, THE PALM VALLEY STORM CHANNEL
AND WEST EL PASEO PURSUANT TO A DISPOSITION AND
DEVELOPMENT AGREEMENT BY AND BETWEEN THE PALM DESERT
REDEVELOPMENT AGENCY AND C V FOOD SERVICE, INC. (D.B.A. LA
SPIGA)
The City Council of the City of Palm Desert hereby finds, determines, resolves and
orders as follows:
Section 1. On March 9, 2006, the City Council of the City of Palm Desert (the “City”) and
the Palm Desert Redevelopment Agency (the “Agency”) held a duly noticed joint public hearing
on the approval of the Agency’s proposed sale of certain real property consisting of
approximately 0.53 acres located in the Agency’s Project Area No. 1 (the “Property”), as
described in that certain Disposition and Development Agreement (the “Agreement”) by and
between C V Food Service, Inc., a California corporation, d.b.a. La Spiga (the “Developer”) and
the Agency, at which time all persons desiring to comment on or ask questions concerning the
Agreement and the lease of the Property to the Developer were given the opportunity to do so.
On or before February 23, 2006, information concerning the Agency’s proposed sale of the
Property to Developer, a copy of the Agreement, and the Summary Report prepared pursuant to
California Health and Safety Code Section 33433 were made available for public inspection and
copying in the offices of the Palm Desert Redevelopment Agency at 73-510 Fred Waring Drive,
Palm Desert, California 92260 between the hours of 8 a.m. and 5 p.m., Monday through Friday.
Notice of the public hearing was published in the Desert Sun on Thursday, February 23, 2006
and Thursday, March 2, 2006.
Section 2. Pursuant to the Agreement, the Developer covenants to construct certain
improvements on the property within a certain time period as therein described, including but
not limited to, an approximately 4,500 square foot restaurant facility plus an approximately 1,000
square foot exterior patio, walled gardens and certain public improvements.
Section 3. The City Council reviewed and considered all written and oral comments,
questions and concerns regarding the Agency’s proposed sale of the Property to Developer
received prior to and at the public hearing on March 9, 2006.
Section 4. The Property contains approximately 0.53 acres, and pursuant to the
Agreement will be sold to the Developer for a purchase price of $750,000. Agency staff
obtained a report prepared by a real estate analysis services company, which evaluated the fair
market value of the Property at its highest and best use, and determined that the probable fair
market value of this property at its highest and best use is approximately $32.50 per square
foot. A Summary Report prepared pursuant to California Health and Safety Code Section
33433 is attached hereto as Exhibit A.
RESOLUTION NO. 06-
Section 5. Project Area No. 1 is an area which has been previously identified in the
Redevelopment Plan for Project Area No. 1, originally approved and adopted by the City
Council of the City pursuant to Ordinance No. 80 on July 16, 1975, as may be amended from
time to time, as a blighted area. The area has previously been determined to create a social
and economic burden on the community, which cannot reasonably be expected to be reversed
or alleviated by private enterprise or governmental action, or both, without redevelopment. In
addition, Project Area No. 1 contains vacant and underutilized properties, and properties that
suffer from economic dislocation, deterioration or disuse including depreciated or stagnant
property values and impaired investments. Project Area No. 1 is characterized by the existence
of inadequate public improvements, public facilities and open spaces, which cannot be
remedied by private or governmental action without redevelopment.
Section 6. The City Council hereby finds that the sale of the property pursuant to the
Agreement will assist in the elimination of blight, providing for Developer’s construction of
certain improvements, and use described in the Agreement on previously vacant underutilized
land which will remedy the lack of adequate public improvements, assist in the revitalization of
Project Area No. 1, encourage private sector investment, and create job opportunities all for the
health, safety and welfare of the residents and taxpayers of the City.
Section 7. The City Council hereby finds that the proposed sale of the property is
consistent with the Agency’s Implementation Plan adopted pursuant to California Health and
Safety Code Section 33490.
Section 8. The City Council hereby finds that the consideration to be paid by Developer
pursuant to the Agreement is not less than the fair market value of the property at its highest
and best use in accordance with the Redevelopment Plan for the Agency’s Project Area No. 1.
Section 9. In 1989, an Environmental Impact Report was prepared and approved for the
Ahmanson Commercial Development Plan, which was proposed for the same approximately
twelve (12) acre site of which the Property is a part (the “Master Site”). Pursuant to the
requirements of the California Environmental Quality Act (CEQA), Agency staff and the Director
of Community Development have found that (a) the proposed project (sale of the property for
construction of a restaurant facility) is a project within the scope of the EIR prepared for the
Master Site, (b) the proposed project constitutes a less intense use than the proposed
development of the Master Site contemplated by the EIR, and (c) pursuant to California Public
Resources Code Section 21090 and State CEQA Guidelines Section 15180, further
environmental review of the project is not required. The Agency staff found and the City Council
finds in exercise of its independent judgment that none of the factors in State CEQA Guidelines
Section 15162 or 15163 apply, and therefore no subsequent or supplemental EIR or Negative
Declaration is required. Specifically, substantial changes have not occurred with respect to the
circumstances under which the project is undertaken that require major revisions to the previous
EIR due to the involvement of new significant environmental effects or substantial increase in
the severity of previously identified significant effects. In addition, new information of substantial
importance, which was not known and could not have been known with the exercise of
reasonable diligence, is not present in this matter and does not arise due to the proposed
Agreement. Based on all the information in the record of this matter, and on the grounds,
including but not limited to those specified above, the City Council hereby finds the project
exempt from CEQA pursuant to State CEQA Guidelines Section 15180. The City Council
further finds that the project will have a diminimus impact on wildlife resources. The City
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RESOLUTION NO. 06-
Council directs staff to file a Notice of Exemption and any of the required environmental filings
with the County Clerk’s office.
Section 10. The City Council hereby approves the Agreement and the Agency’s sale of
the property to Developer in accordance with the terms and conditions of the Agreement
pursuant to the requirements of California Health and Safety Code Section 33433 (b) and
authorizes the Agency’s Executive Director and/or any other authorized officers of the Agency to
take such actions, perform such deeds, and execute, acknowledge and deliver such instruments
and documents as the Agency deems necessary in connection therewith. The City Council
hereby authorizes the Agency’s Executive Director, and/or any other authorized officers of the
Agency, to enter into the Agreement in substantially the form now on file with the City Clerk with
such changes therein as may be necessary and as the Executive Director may approve in his
discretion as being in the best interest of the City. Such approval to be conclusively evidenced
by the execution and delivery thereof in order to effectuate the development and operation of
the Property by the Developer, and to take such actions, perform such deeds, and execute,
acknowledge, and deliver such instruments and documents as it deems necessary in
connection therewith.
th
PASSED, APPROVED AND ADOPTED this 9 day of March 2006 by the following vote
to wit:
AYES:
NOES:
ABSTAIN:
ABSENT:
Jim Ferguson, Mayor
ATTEST:
Rachelle D. Klassen, City Clerk
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RESOLUTION NO. 06-
EXHIBIT A
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� REASCO � REAL ESTATE ANALYSIS SERVICES CO.
February 23, 2006
TEL: (760) 340-1429; FAX: (760) 340-2041
EMAIL: LRWREASCO@AOL.COM
Ms Lauri Aylaian
Development Manager
PALM DESERT REDEVELOPMENT AGENCY
CITY OF PALM DESERT
73-510 Fred Waring Drive
Palm Desert, Califomia 92260
REFERENCE:
SUBJECT:
POST OFFICE BOX 2809, PALM DESERT, CALIFORNIA 92261
Copies to: Mr. Justin McCarthy
Mr. David Yrigoyen
Proposed Sale Of Agency Property To CV Food Service, Inc.,
dba La Spiqa
Report Pursuant To Section 33433 Of The California
Health And Safetv Code
NOTE 1: This report is based on the terms and conditions of the Disposition and
Development Agreement ("Agreement") Dated , 2006 between the
Palm Desert Redevelopment Agency ("Agency") and CV Food Service, Inc.
dba La Spiga ("Developer").
Dear Ms. Aylaian,
Section 33433 of the California Health and Safety Code stipulates that before any property of
the Agency, acquired directly or indirectly with tax increment funds, is sold or leased (or
otherwise conveyed) for development purposes pursuant to the redevelopment plan, the
conveyance shall first be approved by the legislative body by resolution after public hearing.
The property the Agency proposes to sell to the Developer falls into the category covered by
Section 33433.
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February 23, 2006
LETTER TO:
SU BJECT:
Ms Lauri Avlaian
Report Pursuant To Section 33433 Of The California
Health And Safetv Code
We have prepared a comprehensive report, beginning on page three of this letter, which is
required in order to comply with Section 33433. Pursuant to the report, we have concluded
that the following findings can be included in the resolution approving the Agreement:
FINDING #1: The Sale of the Property will assist in the elimination of blight in
the Project Area.
FINDING #2: The Sale of the Property is consistent with the implementation
plan adopted pursuant to Section 33490 of the California Health and
Safety Code.
FINDING #3: The consideration is not less that the Fair Market Value at its highest
and best use in accordance with the plan.
The rationale for these findings can be found in the report which begins on page 3
of this letter.
Sincerely,
Leonard R. Wolk
Leonard R. Wolk, President
Real Estate Analysis Services Company (REASCO)
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Followina are the detailed Sections of the report:
SECTION 1- A summary of the major business points of the Agreement between
the Agency and the Developer concerning the proposed sale of the Subject
Property, owned by the Agency, to the Developer.
Reference is made to the Ageement for full particulars of any provision described
herein. In the event of any inconsistency between the provisions herein and the
Agreement, the Agreement shall control.
A. The Subiect Proqertv:
1. The Agency owns fee title to certain unimproved real property (the "Property") in the
City of Palm Desert (the "City"). The Property is located on the north side of Painter's
Path, west of EI Paseo, within the 12 acre Master Site known as Entrada del Paseo.
2. The Property is legally described in Exhibit A of the Agreement and its size is
approximately 0.53 acres, or 23,077 square feet.
B. Purchase and Sale of the Propertv:
1. Subject to the teRns and conditions of the Agreement, the Agency agrees to sell to
the Developer, and the Developer agrees to purchase from the Agency, fee simple
title to the Property at an agreed to price of $750,000, or $32.50 per square foot.
Agency and Developer agree that the purchase price is the fair market value of the
Property.
� Refer to Article 2 of the Agreement for further details about the Purchase and
Sale of the Property.
C. Develoament of the Improvements:
1. Developer shall develop, or cause to be developed, the improvements on the
Property in accordance with the Schedule of Performance and the Scope of
Development (Exhibits B and C of the Agreement, respectively). The cost for
developing and constructing the improvements shall be bome solely by Developer.
-� Refer to Article 3 of the Agreement for further details about Development
of the Improvements.
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D. Aqencv's Obliqations:
1. The Agency shall deliver the Property to Developer at close of escrow with a finished
(over-excavated, backfilled, rough graded, compacted and certified) building pad,
and with available temporary power, fire protection and water service.
2. The Agency shall complete the construction of a community use building (the
"Henderson Community Building") on Parcel 12 and the landscaped gardens (the
"Gardens/Open Space") on Parcels 2 and 12, as designated on the Parcel Map
Number 30226, all in accordance with the Master Site Plan, within the time frame
described in Exhibit B of the Agreement.
3. The Agency shall construct, or cause to be constructed and completed prior to a date
which is nine months after close of escrow, the 18 parking spaces and all utilities
described in Exhibit C of the Agreement as "Public Improvements".
Both Parties acknowledge that 205 public parking spaces have already been
constructed, and that 18 more spaces will be constructed by the Agency under the
terms of the Agreement. They further acknowledge that this number of spaces will be
sufficient to serve the improvements currently constructed on the Master Site plus the
planned Henderson Community Building and the Improvements to be constructed by
the Developer.
If the Agency constructs (or permits construction of) additional building(s) on Parcel 1
of the Master Site, Agency agrees to construct additional parking spaces in the full
quantity required for such additional building(s) by local ordinance, without reducing
such number by the number of parking spaces which are subject to shared use
agreements between the Agency and the users of the Master Site.
� Refer to Article 3 of the Agreement for further details about Agency's Obligations.
E. Limitations on Transfers and Security Interests:
1. Prior to issuance of a Certificate of Completion for the improvements, Developer
shall not sell, assign, transfer, mortgage, hypothecate or convey (collectively a
"Transfer") the Property or any part thereof, or any of Developer's nghts or obligations
pursuant to the Agreement, without the Agency's prior written consent, subject to
certain exceptions described in Section 4.1.1 of the Agreement.
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E. Limitations on Transfers and Securitv Interests (continued):
2. Developer acknowledges that the identity of Developer is of particular concern to the
Agency, and it is because of Developer's identity that the Agency has entered into the
Agreement with Developer.
� Refer to Article 4 of the Agreement for further details about Limitations on
Transfers and Security Interests
F. Use of the Propertv:
1. For a period of twenty years after the close of escrow, (the "Term of Use"),
Developer and its lessees, successors and assigns shall use the Property and the
improvements only for the operation of a fine dining restaurant and ancillary uses, and
any other uses expressly permitted by the Agency.
2. So long as the Agreement is in effect and Developer is operating a fine restaurant
on the Property featuring Italian cuisine, Agency shall not permit any other property
within the Master Site to be used for the operation of a restaurant which features
Italian-inspired cuisine.
3. During the Term of Use, Developer shall maintain the Property and the improvements
thereon in good condition and repair and in a manner substantially comparable to the
highest level of maintenance provided by owners of developments in the Coachella
Valley substantially similar to and of similar age as the improvements.
4. The common area maintenance costs as described in Exhibit H of the Agreement
and including landscape water consumption of the Paricing Lot Site described in the
Easement Agreement (Exhibit E of the Agreement) shall be included within the
common area expenses shared by all owners and occupants of the Property included
within the Master Site. Devefoper shall be responsible for the monthly payments to the
Agency of its pro rata share of the common area expenses required to maintain the
Parking Lot Site. Developer's pro rata share of such common area expenses shall be
based on the ratio of the number of parking spaces required for the improvements,
which is acknowledged by the parties to the Agreement to be 60, to the total number
of parking spaces available within the Master Site.
♦ Refer to Article 5 of the Agreement for further details about Use of the Property.
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G. Events of Default, Remedies and Termination:
1. Subject to the provisions of Articles 2 and 6 of the Agreement regarding Developer's
appeal rights, the occurances which constitute a Default are described in Article 6.1.
of the Agreement.
2. In the event of a Default by any Party to the Agreement prior to the Close of Escrow,
the non-defaulting Party may pursue any and all of the remedies provided in A�ticle 2
of the Agreement.
3. In the event of a Default by any Party ta the Agreement after the Close of Escrow, the
non-defaulting Party shall be entitled to the remedies described in Article 6.2.2 of the
Agreement.
� Refer to Article 6 of the Agreement for further details about Default, Remedies
and Termination.
SECTION 2- Cost of the Agreement to the Agency:
The cost of the Agreement to the Agency is comprised of the following three components:
(1). the land acquisition cost; (2). the cost of any improvements to be provided by the Agency;
and (3). the projected interest on the source of funds used to finance the land acquisition cost
and the improvement cost.
A. The Aaencv's land acquisition cost:
NOTE: The Agency's purchase was funded by a loan from the City.
1. The Agency purchased the Master Site on 11/1/1998 at a purchase price of $3,347,917.
Therefore, the acquisition cost for the Master Site can be exqressed as follows:
ACRES
a. Amount of land
b. Cost per acre; per sq. ft.
c. Total cost
11.97
$279,692
SQ. FT.
521,413
$6.42
$3,347,917 $3,347,917
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A. The Aqencv's land acquisition cost (continued):
2. Calculation of the qro rata land ac4uisition cost for the Propertv:
NOTE: The Property area includes the gross restaurant area plus the
amount of land for which Developer has a non-exclusive
easement for 60 parking spaces.
a. Gross restaurant area
b. Plus parking rights area
c. Total area
d. Times cost per acre; per sq. ft.
e. Total cost (pro rata)
ACRES
0.5298
0.4132
0.9430
$279,692
$263,749
PERCENT OF
SQ. FT. MASTER SITE
23,077 n/a
18,000 n/a
41,077 7.88%
$6.42 n/a
$263,749 7.88%
B. Calculation of the Aaencv's proiected finance cost for the land aurchase:
The land acquisition cost was funded by an interest-only loan from the City, whereby the
interest payments were at the appropriate LAIF rate. The following table describes the
Aqencv's annual interest qavments to the Citv:
YEAR � 1998 1999-2005 2006*
1. Loan balance
2. Times average interest rate
3. Interest payments to the City
4. Totaf payments through
escrow close date = —� $80,047
$263,749 $263,749 $263,749
5.43% - 3.966%
$2,38825 $67,198.81 $10,459.64
* LAIF rates for February, 2006 through November, 2006 are not yet available, so
estimates were used.
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C. Cost and timinq of the improvements to be provided bv the Aqencv:
NOTE: Projected escrow close date is 11/30l2006
Pursuant to the AQreement, the Aqencv will provide the followinQ improvements:
IMPROVEMENTS
ESTIMATED
C OST
DUE DATE
1. The finished (over-excavated, backfilled, rough graded,
compacted and certified) pad, and available with temporary
power, fire protection and water service.
2. Bringing utilities to the pad.
3. Sewer work
4. Water lines and detector check for fire sprinkler system
5. Fire hydrant
6. TUMPF and lizard fees
7. Constuctin� 18 parlcinq spaces. 5760 $8.04
8. Agency's total Improvement cost
D. Aqencv's method of qavment for the improvements:
1. The building pad will be paid for with tax increment funds.
2. Funds available to Agency when escrow closes
3. Less payoff of City's land loan
4. Funds remaining to pay for Agency's remaining obligation
5. Less cost of A�ency's remainin� obliqation
6. Funds remaining to reimburse tax increment fund
E. Aqencv's net cost of the Aqreement:
1. Interest payment to the City for land loan
2. The Agency will lose one year of investment income that could
have been eamed on the tax increment funds to pay for the
building pad, because in the following year, the funds would be
used to fund another project.
At a projected LAIF rate of 3% per year, the Agency witl lose
3. Net funds remaining to reimburse the tax increment fund
4. Less cost of building pad
5. Net cost of the Agreement to Agency (actually a net gain)
MY 33433 REPORTSP'33433 FOR LA SPIGA (1)"
$9,480
$65,000
$40,100
$8,053
$10,000
$10,357
$46,316
10/31 /2006
5/1 /2007
5/1 /2007
5/1 /2007
5/1/2007
5/1/2007
5/1 /2007
$189,306 -
$750,000
($263,749)
$486,251
($179,826)
$306,425
($80,047)
($284)
$306,425
($9,480)
$216,614
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SECTION 3- The estimated value of the interest to be conveyed (the unimproved
Property) determined at the highest and best uses permitted under the
Redevelopment Plan (the "Fair Market Value").
A. Hiqhest and best use for the interest to be conveved:
1. Pursuant to its current zoning and a recent appraisal, the highest and best use for the
interest to be conveyed is for development of a retail/restaurant building.
B. Estimated value at the hiahest and best use of the interest to be conveved:
1. Pursuant to the recent appraisal, the current estimated value at the highest and best
use of the interest to be conveyed is $32.50 per sauare foot. �
Section 4- The estimated value of the interest to be conveyed (the unimprovad
Property) determined at the use and with the conditions, covenents and development
costs required by the sale (the "Reuse Value"):
1. Pursuant to the appraisal, the purchase price ($32.50 per spuare foot) represents
the Reuse Value of the Property at the use, and with the conditions, covenants and
development costs authorized by the Agreement.
Section 5- Findings to be included in the resolution approving the transaction:
FINDING #1: The sale of the Property will assist in the elimination of blight in
the Project Area.
FINDING #Z: The sale of the Property is consistent with the implementation
plan adopted pursuant to Section 33490 of the California Health
and Safety Code.
FINDING #3: The consideration is not less that the Fair Market Value at its
highest and best use in accordance with the plan.
MY 33433 REPORTSP'33433 FOR LA SPIGA (1)" 28-Feb-U6 11:27 AM
REASCO I REAL ESTATE ANALYSIS SERVICES CO.
POST OFFICE BOX 2809, PALM DESERT, CALIFORNIA 92261
TEL: (760) 340-1429; FAX: (760) 340-2041
EMAIL: LRWREASCO@AOL.COM
February 23, 2006
Ms Lauri Aylaian
Development Manager
PALM DESERT REDEVELOPMENT AGENCY
CITY OF PALM DESERT
73-510 Fred Waring Drive
Palm Desert, Califomia 92260
Copies to: Mr. Justin McCarthy
Mr. David Yrigoyen
REFERENCE: Proposed Sale Of Agency Property To CV Food Service, Inc.,
dba La Spiqa
SUBJECT: Report Pursuant To Section 33433 Of The California
Health And Safety Code
NOTE 1: This report is based on the terms and conditions of the Disposition and
Development Agreement ("Agreement") Dated , 2006 between the
Palm Desert Redevelopment Agency ("Agency") and CV Food Service, Inc.
dba La Spiga ("Developer").
Dear Ms. Aylaian,
Section 33433 of the Califomia Health and Safety Code stipulates that before any property of
the Agency, acquired directly or indirectly with tax increment funds, is sold or leased (or
otherwise conveyed) for development purposes pursuant to the redevelopment plan, the
conveyance shall first be approved by the legislative body by resolution after public hearing.
The property the Agency proposes to sell to the Developer falls into the category covered by
Section 33433.
MY 33433 REPORTS/"33433 FOR LA SPIGA (1)"
28-Feb-06 11:27AM
REAL ESTATE ANALYSIS SERVICES COMPANY
-PAGE2-
February 23, 2006
LETTER TO: Ms Lauri Avlaian
SUBJECT: Report Pursuant To Section 33433 Of The California
Health And Safety Code
We have prepared a comprehensive report, beginning on page three of this letter, which is
required in order to comply with Section 33433. Pursuant to the report, we have concluded
that the following findings can be included in the resolution approving the Agreement:
FINDING #1: The Sale of the Property will assist in the elimination of blight in
the Project Area.
FINDING #2: The Sale of the Property is consistent with the implementation
plan adopted pursuant to Section 33490 of the California Health and
Safety Code.
FINDING #3: The consideration is not less that the Fair Market Value at its highest
and best use in accordance with the plan.
The rationale for these findings can be found in the report which begins on page 3
of this letter.
Sincerely,
Leonard R. Wolk
Leonard R. Wolk, President
Real Estate Analysis Services Company (REASCO)
MY 33433 REPORTS/'33433 FOR LA SPIGA (1)" 28-Feb-06
REAL ESTATE ANALYSIS SERVICES COMPANY
11:27 AM
-PAGE3-
Following are the detailed Sections of the report:
SECTION 1 - A summary of the major business points of the Agreement between
the Agency and the Developer concerning the proposed sale of the Subject
Property, owned by the Agency, to the Developer.
Reference is made to the Ageement for full particulars of any provision described
herein. In the event of any inconsistency between the provisions herein and the
Agreement, the Agreement shall control.
A. The Subiect Property:
1. The Agency owns fee title to certain unimproved real property (the "Property") in the
City of Palm Desert (the "City"). The Property is located on the north side of Painter's
Path, west of El Paseo, within the 12 acre Master Site known as Entrada del Paseo.
2. The Property is legally described in Exhibit A of the Agreement and its size is
approximately 0.53 acres, or 23,077 square feet.
B. Purchase and Sale of the Property:
1 Subject to the terms and conditions of the Agreement, the Agency agrees to sell to
the Developer, and the Developer agrees to purchase from the Agency, fee simple
title to the Property at an agreed to price of $750,000, or $32.50 per square foot.
Agency and Developer agree that the purchase price is the fair market value of the
Property.
Refer to Article 2 of the Agreement for further details about the Purchase and
Sale of the Property.
C. Development of the Improvements:
1. Developer shall develop, or cause to be developed, the improvements on the
Property in accordance with the Schedule of Performance and the Scope of
Development (Exhibits B and C of the Agreement, respectively). The cost for
developing and constructing the improvements shall be borne solely by Developer.
Refer to Article 3 of the Agreement for further details about Development
of the Improvements.
MY 33433 REPORTS/"33433 FOR LA SPIGA (1)" 28-Feb-06 11:27 AM
REAL ESTATE ANALYSIS SERVICES COMPANY
-PAGE4-
D. Agency's Obligations:
1. The Agency shall deliver the Property to Developer at close of escrow with a finished
(over -excavated, backfilled, rough graded, compacted and certified) building pad,
and with available temporary power, fire protection and water service.
2. The Agency shall complete the construction of a community use building (the
"Henderson Community Building") on Parcel 12 and the landscaped gardens (the
"Gardens/Open Space") on Parcels 2 and 12, as designated on the Parcel Map
Number 30226, all in accordance with the Master Site Plan, within the time frame
described in Exhibit B of the Agreement.
3. The Agency shall construct, or cause to be constructed and completed prior to a date
which is nine months after close of escrow, the 18 parking spaces and all utilities
described in Exhibit C of the Agreement as "Public Improvements".
Both Parties acknowledge that 205 public parking spaces have already been
constructed, and that 18 more spaces will be constructed by the Agency under the
terms of the Agreement. They further acknowledge that this number of spaces will be
sufficient to serve the improvements currently constructed on the Master Site plus the
planned Henderson Community Building and the Improvements to be constructed by
the Developer.
If the Agency constructs (or permits construction of) additional building(s) on Parcel 1
of the Master Site, Agency agrees to construct additional parking spaces in the full
quantity required for such additional building(s) by local ordinance, without reducing
such number by the number of parking spaces which are subject to shared use
agreements between the Agency and the users of the Master Site.
Refer to Article 3 of the Agreement for further details about Agency's Obligations.
E. Limitations on Transfers and Security Interests:
1. Prior to issuance of a Certificate of Completion for the improvements, Developer
shall not sell, assign, transfer, mortgage, hypothecate or convey (collectively a
"Transfer") the Property or any part thereof, or any of Developer's rights or obligations
pursuant to the Agreement, without the Agency's prior written consent, subject to
certain exceptions described in Section 4.1.1 of the Agreement.
MY 33433 REPORTS!"33433 FOR LA SPIGA (1)"
28-Feb-06 11:27 AM
REAL ESTATE ANALYSIS SERVICES COMPANY
-PAGE5-
E. Limitations on Transfers and Security Interests (continued):
2. Developer acknowledges that the identity of Developer is of particular concern to the
Agency, and it is because of Developer's identity that the Agency has entered into the
Agreement with Developer.
* Refer to Article 4 of the Agreement for further details about Limitations on
Transfers and Security Interests
F. Use of the Property:
1. For a period of twenty years after the close of escrow, (the "Term of Use"),
Developer and its lessees, successors and assigns shall use the Property and the
improvements only for the operation of a fine dining restaurant and ancillary uses, and
any other uses expressly permitted by the Agency.
2. So long as the Agreement is in effect and Developer is operating a fine restaurant
on the Property featuring Italian cuisine, Agency shall not permit any other property
within the Master Site to be used for the operation of a restaurant which features
Italian -inspired cuisine.
3. During the Term of Use, Developer shall maintain the Property and the improvements
thereon in good condition and repair and in a manner substantially comparable to the
highest level of maintenance provided by owners of developments in the Coachella
Valley substantially similar to and of similar age as the improvements.
4. The common area maintenance costs as described in Exhibit H of the Agreement
and including landscape water consumption of the Parking Lot Site described in the
Easement Agreement (Exhibit E of the Agreement) shall be included within the
common area expenses shared by all owners and occupants of the Property included
within the Master Site. Developer shall be responsible for the monthly payments to the
Agency of its pro rata share of the common area expenses required to maintain the
Parking Lot Site. Developer's pro rata share of such common area expenses shall be
based on the ratio of the number of parking spaces required for the improvements,
which is acknowledged by the parties to the Agreement to be 60, to the total number
of parking spaces available within the Master Site.
Refer to Article 5 of the Agreement for further details about Use of the Property.
MY 33433 REPORTS/"33433 FOR LA SPIGA (1)"
28-Feb-06 11:27 AM
REAL ESTATE ANALYSIS SERVICES COMPANY
-PAGE6-
G. Events of Default, Remedies and Termination:
1. Subject to the provisions of Articles 2 and 6 of the Agreement regarding Developer's
appeal rights, the occurances which constitute a Default are described in Article 6.1.
of the Agreement.
2. In the event of a Default by any Party to the Agreement prior to the Close of Escrow,
the non -defaulting Party may pursue any and all of the remedies provided in Article 2
of the Agreement.
3. In the event of a Default by any Party to the Agreement after the Close of Escrow, the
non -defaulting Party shall be entitled to the remedies described in Article 6.2.2 of the
Agreement.
Refer to Article 6 of the Agreement for further details about Default, Remedies
and Termination.
SECTION 2 - Cost of the Agreement to the Agency:
The cost of the Agreement to the Agency is comprised of the following three components:
(1). the land acquisition cost; (2). the cost of any improvements to be provided by the Agency;
and (3). the projected interest on the source of funds used to finance the land acquisition cost
and the improvement cost.
A. The Aaencv's land acquisition cost:
NOTE: The Agency's purchase was funded by a loan from the City.
1. The Agency purchased the Master Site on 11/1/1998 at a purchase price of $3,347,917.
Therefore, the acquisition cost for the Master Site can be expressed as follows:
ACRES SQ. FT.
a. Amount of land 11.97 521,413
b. Cost per acre; per sq. ft. $279,692 $6.42
c. Total cost $3,347,917 $3,347,917
MY 33433 REPORTSP'33433 FOR LA SPIGA (1)" 28-Feb-06 11:27 AM
REAL ESTATE ANALYSIS SERVICES COMPANY
-PAGE7-
A. The Aaencv's land acquisition cost (continued):
2. Calculation of the pro rata land acquisition cost for the Property:
NOTE: The Property area includes the gross restaurant area plus the
amount of land for which Developer has a non-exclusive
easement for 60 parking spaces.
a. Gross restaurant area
b. Plus parking rights area
c. Total area
d. Times cost per acre; per sq. ft.
e. Total cost (pro rata)
ACRES
0.5298
0.4132
0.9430
$279,692
$263,749
PERCENT OF
SQ. FT. MASTER SITE
23,077 n/a
18,000 n/a
41,077 7.88%
$6.42 n/a
$263,749 7.88%
B. Calculation of the Aaencv's proiected finance cost for the land purchase:
The land acquisition cost was funded by an interest -only loan from the City, whereby the
interest payments were at the appropriate LAIF rate. The following table describes the
Aaencv's annual interest payments to the City:
YEAR ÷ 1998 1999-2005 2006*
1. Loan balance
2. Times average interest rate
3. Interest payments to the City
4. Total payments through
escrow close date = -- $80,047
5.43% -
$2,388.25 $67,198.81
$263,749 $263,749 $263,749
3.966%
$10,459.64
* LAIF rates for February, 2006 through November, 2006 are not yet available, so
estimates were used.
MY 33433 REPORTS/'33433 FOR LA SPIGA (1)"
28-Feb-06 11:27 AM
REAL ESTATE ANALYSIS SERVICES COMPANY
-PAGE8-
C. Cost and timing of the improvements to be provided by the Agency;
NOTE: Projected escrow close date is 11/30/2006
Pursuant to the Agreement, the Agency will provide the following improvements:
ESTIMATED
IMPROVEMENTS COST DUE DATE
1. The finished (over -excavated, backfilled, rough graded,
compacted and certified) pad, and available with temporary
power, fire protection and water service. $9,480 10/31/2006
2. Bringing utilities to the pad. $65,000 5/1/2007
3. Sewer work $40,100 5/1/2007
4. Water lines and detector check for fire sprinkler system $8,053 5/1/2007
5. Fire hydrant $10,000 5/1/2007
6. TUMPF and lizard fees $10,357 5/1/2007
7. Constucting 18 parking spaces. 5760 $8.04 $46,316 5/1/2007
8. Agency's total Improvement cost $189,306
D. Agency's method of payment for the improvements:
1. The building pad will be paid for with tax increment funds.
2. Funds available to Agency when escrow closes
3. Less payoff of City's land loan
4. Funds remaining to pay for Agency's remaining obligation
5. Less cost of Agency's remaining obligation
6. Funds remaining to reimburse tax increment fund
E. Agency's net cost of the Agreement:
$750,000
($263,749)
$486,251
($179,826)
$306,425
1. Interest payment to the City for land loan ($80,047)
2. The Agency will lose one year of investment income that could
have been earned on the tax increment funds to pay for the
building pad, because in the following year, the funds would be
used to fund another project.
At a projected LAIF rate of 3% per year, the Agency will lose ($284)
3. Net funds remaining to reimburse the tax increment fund $306,425
4. Less cost of building pad ($9,480)
5. Net cost of the Agreement to Agency (actually a net gain) $216,614
MY 33433 REPORTSP'33433 FOR LA SPIGA (1)"
28-Feb-06 11:27AM
REAL ESTATE ANALYSIS SERVICES COMPANY
-PAGE9-
SECTION 3 - The estimated value of the interest to be conveyed (the unimproved
Property) determined at the highest and best uses permitted under the
Redevelopment Plan (the "Fair Market Value").
A. Highest and best use for the interest to be convened:
1. Pursuant to its current zoning and a recent appraisal, the highest and best use for the
interest to be conveyed is for development of a retail/restaurant building.
B. Estimated value at the highest and best use of the interest to be conveyed:
1. Pursuant to the recent appraisal, the current estimated value at the highest and best
use of the interest to be conveyed is $32.50 per sauare foot.
Section 4 - The estimated value of the interest to be conveyed (the unimproved
Property) determined at the use and with the conditions, covenents and development
costs required by the sale (the "Reuse Value"):
1. Pursuant to the appraisal, the purchase price ($32.50 per square foot) represents
the Reuse Value of the Property at the use, and with the conditions, covenants and
development costs authorized by the Agreement.
Section 5 - Findings to be included in the resolution approving the transaction:
FINDING #1: The sale of the Property will assist in the elimination of blight in
the Project Area.
FINDING #2: The sale of the Property is consistent with the implementation
plan adopted pursuant to Section 33490 of the California Health
and Safety Code.
FINDING #3: The consideration is not less that the Fair Market Value at its
highest and best use in accordance with the plan.
MY 33433 REPORTS/"33433 FOR LA SPIGA (1)"
28-Feb-06 11:27 AM
DRAFT – Subject to such
changes as may be necessary
for clarification and as the
Executive Director may
approve in his discretion as
being in the best interest of the
Agency.
DISPOSITION AND DEVELOPMENT AGREEMENT
BY AND BETWEEN
PALM DESERT REDEVELOPMENT AGENCY
AND
CV FOOD SERVICE, INC., dba LA SPIGA
DATED
____________________________
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TABLE OF CONTENTS
PAGE
ARTICLE 1 DEFINITIONS. ........................................................................................... 2
Section 1.1 Definitions ............................................................................................. 2
ARTICLE 2 PURCHASE AND SALE OF THE PROPERTY. ........................................ 5
Section 2.1 Purchase and Sale ............................................................................... 5
Section 2.2 Purchase Price ..................................................................................... 5
Section 2.3 Opening and Closing of Escrow ........................................................... 6
Section 2.4 Condition of Title; Title Insurance. ........................................................ 7
Section 2.5 Escrow Charges ................................................................................... 9
Section 2.6 Conditions to Close of Escrow .............................................................. 9
Section 2.7 Escrow Holder. ................................................................................... 10
Section 2.8 Condition of the Property. ................................................................... 11
Section 2.9 Deposit into Escrow. ........................................................................... 15
Section 2.10 Authorization to Record Documents and Disburse Funds. ................. 16
Section 2.11 Escrow’s Closing Actions ................................................................... 16
Section 2.12 Environmental Indemnity .................................................................... 17
Section 2.13 Additional Instructions ........................................................................ 17
ARTICLE 3 DEVELOPMENT OF THE PROPERTY. .................................................. 17
Section 3.1 Development of the Improvements ..................................................... 17
Section 3.2 Agency’s Right to Review Plans and Specifications ........................... 19
Section 3.3 Preliminary Site Plan .......................................................................... 19
Section 3.4 Basic Concept Drawings .................................................................... 19
Section 3.5 Preliminary Drawings .......................................................................... 20
Section 3.6 Landscaping ....................................................................................... 20
Section 3.7 Final Construction Drawings and Related Documents ....................... 20
Section 3.8 Approval of Construction Plans .......................................................... 20
Section 3.9 Construction Contract ......................................................................... 21
Section 3.10 \[Intentionally omitted.\] ..................................................................... 21
Section 3.11 Changes in Construction Drawings .................................................... 21
Section 3.12 Cost of Construction ........................................................................... 21
Section 3.13 Rights of Access ................................................................................. 21
Section 3.14 Local, State and Federal Laws ........................................................... 22
Section 3.15 City and Other Governmental Agency Permits and Approvals ........... 22
Section 3.16 Anti-discrimination During Construction .............................................. 22
Section 3.17 Taxes, Assessments, Encumbrances and Liens ................................ 22
Section 3.18 No Agency Created ............................................................................ 22
Section 3.19 Consent by City .................................................................................. 22
C:\\Users\\nmartin\\AppData\\Local\\Temp\\16490 (2)_991092\\16490 (2).doc i
TABLE OF CONTENTS
(Continued)
Page
Section 3.20 Certificates of Completion .................................................................. 23
ARTICLE 4 LIMITATIONS ON TRANSFERS AND SECURITY INTERESTS. ............ 23
Section 4.1 Restriction on Transfer of Developer’s Rights and Obligations. ......... 23
Section 4.2 Mortgages and Deeds of Trust ........................................................... 24
Section 4.3 Rights of Holders ................................................................................ 24
Section 4.4 Noninterference with Holders ............................................................. 24
ARTICLE 5 USE OF THE PROPERTY. ...................................................................... 25
Section 5.1 Use of Property................................................................................... 25
Section 5.2 Obligation to Refrain from Discrimination ........................................... 26
Section 5.3 Form of Nondiscrimination and Non-Segregation Clauses ................. 27
Section 5.4 \[Intentionally Omitted\] ......................................................................... 27
Section 5.5 Exclusive Use Rights .......................................................................... 27
ARTICLE 6 EVENTS OF DEFAULT, REMEDIES AND TERMINATION. ................... 28
Section 6.1 Default – Definition ............................................................................. 28
Section 6.2 Remedies in the Event of Default. ...................................................... 30
Section 6.3 Liberal Construction............................................................................ 30
Section 6.4 No Personal Liability ........................................................................... 30
Section 6.5 Rights and Remedies are Cumulative ................................................ 30
Section 6.6 Inaction Not a Waiver of Default ......................................................... 31
Section 6.7 Force Majeure .................................................................................... 31
ARTICLE 7 INDEMNITY; INSURANCE. ..................................................................... 31
Section 7.1 Indemnification Agreement ................................................................. 31
Section 7.2 Insurance Coverage Requirements: ................................................... 33
ARTICLE 8 GENERAL PROVISIONS. ....................................................................... 36
Section 8.1 Notices ............................................................................................... 36
Section 8.2 Construction ....................................................................................... 36
Section 8.3 Interpretation ...................................................................................... 37
Section 8.4 Agency’s Consent............................................................................... 37
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TABLE OF CONTENTS
(Continued)
Page
Section 8.5 Further Assurances ............................................................................ 37
Section 8.6 Authority ............................................................................................. 37
Section 8.7 Enforceability ...................................................................................... 37
Section 8.8 Time of the Essence ........................................................................... 38
Section 8.9 Warranty Against Payment of Consideration for Agreement .............. 38
Section 8.10 Attorneys’ Fees................................................................................... 38
Section 8.11 Entire Agreement, Waivers and Amendments .................................... 38
Section 8.12 Severability ......................................................................................... 38
Section 8.13 Headings ............................................................................................ 39
Section 8.14 No Third Party Beneficiaries other than the City ................................. 39
Section 8.15 Governing Law; Jurisdiction; Service of Process ................................ 39
Section 8.16 Survival ............................................................................................... 39
Section 8.17 Assignment ......................................................................................... 39
Section 8.18 Counterparts ....................................................................................... 39
Section 8.19 Successors and Assigns .................................................................... 39
P6402\\0001\\862173.4
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DISPOSITION AND DEVELOPMENT AGREEMENT
THIS DISPOSITION AND DEVELOPMENT AGREEMENT (“Agreement”), dated
as of ________________, 2006, is entered into by and between the PALM DESERT
REDEVELOPMENT AGENCY, a public body, corporate and politic (the “Agency”), and
CV FOOD SERVICE, INC. dba La Spiga, a corporation organized and existing under
the laws of the State of California (“Developer”).
RECITALS
This Agreement is entered into with reference to the following facts:
1. The purpose of this Agreement is to effectuate the Redevelopment Plan for
Project Area 1, as amended (the “Project Area”) of the Agency (the “Redevelopment
Plan”), in the City of Palm Desert, California, by facilitating improvements to real
property within the Project Area (as defined below).
2. The Redevelopment Plan has been approved and adopted by Ordinance No. 80
of the City of Palm Desert on July 16, 1975, as amended.
3. The Agency is 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.
4. The Agency owns fee title to the Property (as defined below) and by and subject
to the provisions of this Agreement intends to convey such title to the Developer.
5. Construction of the Project (as defined below) will assist in the elimination of
blight in the Project Area, provide additional jobs, and substantially improve the
economic and physical conditions in the Project Area in accordance with the purposes
and goals of the Redevelopment Plan.
6. The Property constitutes a portion of a twelve (12) acre Master Site (as defined
below) which is being developed in accordance with the Master Site Plan (as described
below).
7. The land uses specified in this Agreement and the provisions relating to
construction of the Project are consistent with the provisions of the Redevelopment Plan
and each of its applicable elements.
8. A material inducement to the Agency to enter into this Agreement is the
agreement by Developer to perform its obligations as provided herein.
9. The Purchase Price (as defined below) constitutes the fair market value of the
Property.
P6402\\0001\\862173.4
AGREEMENT
NOW, THEREFORE, in consideration of the above recitals, which are
incorporated herein by reference, and of the mutual covenants contained in this
Agreement the parties hereto agree as follows:
ARTICLE 1 DEFINITIONS.
Section 1.1 Definitions. The following terms as used in this Agreement shall
have the meanings given unless expressly provided to the contrary:
1.1.1 Affiliate means an entity that directly or indirectly controls, is
controlled by, or is under direct or indirect common control with Developer. Control
shall mean, as used herein, the possession, direct or indirect, of the power to direct or
cause the direction of the management and policies of a corporation, partnership, joint
venture, trust, or other association.
1.1.2 Agency means the Palm Desert Redevelopment Agency, 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.
1.1.3 Agency Board means the board of directors of the Palm Desert
Redevelopment Agency.
1.1.4 Agreement means this Disposition and Development Agreement.
1.1.5 City means the City of Palm Desert, a municipal corporation.
1.1.6 City Council means the City Council of the City of Palm Desert, a
municipal corporation.
1.1.7 Certificate of Occupancy means a certificate issued by the City of
Palm Desert pursuant to the City’s building code as defined in such code approving a
retail/commercial facility for use by occupants.
1.1.8 Close of Escrow is defined in Section 2.3.
1.1.9 Close of Escrow Date for the Property means the date upon
which the Agency by grant deed shall convey title to the Property to Developer and such
grant deed is recorded in the Official Records of the County of Riverside in accordance
with this Agreement.
1.1.10 Construction Contract is defined in Section 3.9.
1.1.11 Default is defined in Section 6.1.
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1.1.12 Easement Agreement is defined in Section 2.4.5.
1.1.13 Escrow is defined in Section 2.3.
1.1.14 Escrow Holder means First American Title Insurance Company
(Carolin Hoff, Escrow Officer). The principal office of the Escrow Holder for purposes of
this Agreement is 520 N. Central Avenue, 8th Floor, Glendale, California 91203;
Telephone: (800) 668-4853, ext. 5722; Fax: (818) 243-5946.
1.1.15 Force Majeure Delay is defined in Section 6.7.
1.1.16 General Contractor is defined in Section 3.9.
1.1.17 Grant Deed is defined in Section 2.4.5.
1.1.18 Hazardous Materials means any chemical, material or substance
now or hereafter defined as or included in the definition of “hazardous substances,”
“hazardous wastes,” “hazardous materials,” “extremely hazardous waste,” “restricted
hazardous waste,” “toxic substances,” “pollutant or contaminant,” “imminently
hazardous chemical substance or mixture,” “hazardous air pollutant,” “toxic pollutant,” or
words of similar import under any local, state or federal law or under the regulations
adopted or publications promulgated pursuant thereto applicable to the Property,
including, without limitation: the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, 42 U.S.C. §9601, et seq. (“CERCLA”); the
Hazardous Materials Transportation Act, as amended, 49 U.S.C.§ 1801, et seq.; the
Federal Water Pollution Control Act, as amended, 33 U.S.C. § 1251, et seq.; and the
Resource Conservation and Recovery Act of 1976, 42 U.S.C. § 6901, et seq. The term
“Hazardous Materials” shall also include any of the following: any and all toxic or
hazardous substances, materials or wastes listed in the United States Department of
Transportation Table (49 CFR 172.101) or by the Environmental Protection Agency as
hazardous substances (40 CFR Part 302) and in any and all amendments thereto; oil,
petroleum, petroleum products (including, without limitation, crude oil or any fraction
thereof), natural gas, natural gas liquids, liquified natural gas or synthetic gas usable for
fuel, not otherwise designated as a hazardous substance under CERCLA; any
substance which is toxic, explosive, corrosive, reactive, flammable, infectious or
radioactive (including any source, special nuclear or by-product material as defined at
42 U.S.C. § 2011, et seq.), carcinogenic, mutagenic, or otherwise hazardous and is or
becomes regulated by any governmental authority; asbestos in any form; urea
formaldehyde foam insulation; transformers or other equipment which contain dielectric
fluid containing levels of polychlorinated byphenyls; radon gas; or any other chemical,
material or substance (i) which poses a hazard to the Property, to adjacent properties,
or to persons on or about the Property, (ii) which causes the Property to be in violation
of any of the aforementioned laws or regulations, or (iii) the presence of which on, in,
under or in the vicinity of the Property requires investigation, reporting or remediation
under any such laws or regulations.
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3
1.1.19 Holder is defined in Section 4.2.
1.1.20 Improvements means all buildings, landscaping, structures,
infrastructure, utilities, and other improvements to be built on the Property by Developer,
as described in the Scope of Development.
1.1.21 Master Site is that certain real property defined in Exhibit F
attached hereto and incorporated by reference herein.
1.1.22 Master Site Plan is that certain Master Site Plan attached hereto
on Exhibit G and incorporated by reference herein.
1.1.23 Opening of Escrow is defined in Section 2.3.
1.1.24 Party means any party to this Agreement. The “Parties” means
all parties to this Agreement.
1.1.25 Permitted Assignee means any transferee of Developer as may
be approved by the Agency in the exercise of its sole and absolute discretion.
1.1.26 Permitted Exceptions are defined in Section 2.4.5.
1.1.27 Permitted Title Exceptions are defined in Section 2.4.1.
1.1.28 Plans and Specifications means all Basic Concept Drawings,
Preliminary Drawings, Landscaping Plans, Final Construction Drawings, and any other
plans or specifications required for construction of the Improvements (as such terms are
used in Article 3).
1.1.29 Preliminary Report is defined in Section 2.4.1.
1.1.30 Project means the development of the Property by Developer
with the Improvements, and the operation thereof as a restaurant facility, and the
development and operation of the Public Improvements by Agency, as described in this
Agreement and the Scope of Development.
1.1.31 Property is that certain real property to be developed by
Developer described in Exhibit A attached hereto and incorporated by reference herein.
1.1.32 Public Improvements means the public improvements to be
constructed by Agency described in Exhibit C attached hereto and incorporated by
reference herein.
1.1.33 Schedule of Performance means the schedule on Exhibit B
attached hereto and incorporated by reference herein.
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4
1.1.34 Scope of Development means the description of the Project set
forth in Exhibit C attached hereto and incorporated by reference herein.
1.1.35 Title Company is defined in Section 2.4.1.
1.1.36 Title Policy is defined in Section 2.4.6.
1.1.37 Transfer is defined in Section 4.1.1.
ARTICLE 2 PURCHASE AND SALE OF THE PROPERTY.
Section 2.1 Purchase and Sale. Subject to and in accordance with the terms
and conditions hereinafter set forth, the Agency agrees to sell to Developer, and
Developer agrees to purchase from the Agency, fee simple title to the Property.
Section 2.2 Purchase Price. The purchase price for the Property to be paid by
Developer (the “Purchase Price”) shall be the sum of Seven Hundred Fifty Thousand
and 00/100 Dollars ($750,000.00) which the Parties agree is the fair market value of the
Property. The Parties acknowledge that the Property contains approximately 23,077
gross square feet. The Purchase Price shall be payable in cash or by wire transfer of
immediately available funds as follows: Within two (2) business days after the full
execution of this Agreement by both parties, Developer shall deposit with Escrow
Holder the sum of Twenty-Five Thousand and 00/100 Dollars ($25,000.00) as earnest
money (“Deposit”). Developer shall deposit the balance of the Purchase Price with
Escrow Holder prior to the Close of Escrow. All funds held by Escrow Holder on
Deposit, or otherwise, shall be held in an interest bearing account with all interest
credited to Developer, invested as directed by Developer, and applied to the Purchase
Price; provided, however, if escrow does not close by June 30, 2006, due to
Developer’s Default, then the Agency shall receive the Deposit and all accrued interest
on such Deposit.
IF DEVELOPER FAILS TO PURCHASE THE PROPERTY WHEN DEVELOPER
IS OBLIGATED TO DO SO UNDER THE TERMS OF THIS AGREEMENT, AND ALL
CONDITIONS PRECEDENT TO DEVELOPER’S OBLIGATIONS TO CLOSE ESCROW
HAVE BEEN SATISFIED OR EXPRESSLY WAIVED, ESCROW HOLDER MAY BE
INSTRUCTED BY THE AGENCY TO CANCEL THE ESCROW AND THE AGENCY
SHALL THEREUPON BE RELEASED FROM ITS OBLIGATIONS HEREUNDER.
DEVELOPER AND THE AGENCY AGREE THAT BASED UPON THE
CIRCUMSTANCES NOW EXISTING, KNOWN AND UNKNOWN, IT WOULD BE
IMPRACTICAL OR EXTREMELY DIFFICULT TO ESTABLISH THE AGENCY’S
DAMAGES BY REASON OF DEVELOPER’S DEFAULT. ACCORDINGLY,
DEVELOPER AND THE AGENCY AGREE THAT IN THE EVENT OF DEFAULT BY
DEVELOPER UNDER THIS AGREEMENT, IT WOULD BE REASONABLE AT SUCH
TIME TO AWARD THE AGENCY “LIQUIDATED DAMAGES” EQUAL TO THE
DEPOSIT PLUS ALL ACCRUED INTEREST THEREON.
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IF DEVELOPER FAILS TO PURCHASE THE PROPERTY WHEN IT IS
OBLIGATED TO DO SO UNDER THE TERMS OF THIS AGREEMENT, THE AGENCY
MAY INSTRUCT THE ESCROW HOLDER TO CANCEL THE ESCROW WHEREUPON
THE AGENCY SHALL BE RELIEVED FROM ALL LIABILITY HEREUNDER, AND,
PROMPTLY FOLLOWING ESCROW HOLDER’S RECEIPT OF SUCH INSTRUCTION,
AND NOTWITHSTANDING ANY CONFLICTING INSTRUCTION RECEIVED BY
ESCROW HOLDER FROM DEVELOPER OR ANY AGENT OF DEVELOPER,
ESCROW HOLDER SHALL (i) CANCEL THE ESCROW, (ii) PAY ALL OF ESCROW
HOLDER’S CHARGES FROM THE TOTAL AMOUNT OF FUNDS THEN HELD BY
ESCROW HOLDER (OR IF NO SUCH FUNDS ARE HELD BY ESCROW HOLDER,
THEN FROM ADDITIONAL FUNDS DEPOSITED BY DEVELOPER), AND (iii)
DISBURSE TO THE AGENCY (TO THE EXTENT NOT PREVIOUSLY RELEASED IN
ACCORDANCE WITH THIS AGREEMENT) THE APPROPRIATE LIQUIDATED
DAMAGES AMOUNT DESCRIBED IN THIS PARAGRAPH.
Agency’s Initials Developer’s Initials
Section 2.3 Opening and Closing of Escrow. Within five (5) business days after
the Agency’s approval of this Agreement, the Agency and Developer shall cause an
escrow (the “Escrow”) to be opened (the “Opening of Escrow”) with Escrow Holder for
the sale of the Property by the Agency to Developer. The Parties shall deposit with
Escrow Holder a fully executed duplicate original of this Agreement which shall serve as
the escrow instructions for the Escrow. The Agency and Developer shall provide such
additional escrow instructions as shall be necessary and consistent with this
Agreement. Escrow Holder is authorized to act under this Agreement and to carry out
its duties as Escrow Holder hereunder. Escrow shall close after all of the following
conditions have been met, but in no event later than June 30, 2006 (the “Close of
Escrow”):
2.3.1 Developer has approved or waived its due diligence conditions
set forth in Sections 2.6.1 and 2.6.3, below;
2.3.2 Developer has submitted to the Agency, and the Agency has
approved, evidence of construction financing commitment for the Improvements.
Adequate evidence of financing shall consist of binding construction loan commitments
(funding of which may be conditioned upon the satisfaction of lender conditions typical
of such construction financing) and commitments of equity funds in an aggregate
amount equal to all hard costs of designing and constructing the Improvements of the
Project and all soft costs for owning and operating the Improvements until maturity of
the construction loan, as shown on the related proforma and construction budget
approved by the lender;
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2.3.3 Developer and Agency have each obtained their construction
permits and entitlements necessary for the construction of the Improvements and the
Public Improvements, respectively;
2.3.4 the Agency is in a position to turn over to the Developer at the
Close of Escrow the over-excavated and fully compacted building pad in accordance
with the requirements of Exhibit C and Section 3.1.1.1 and has provided possession of
the Property to the Developer; and
In the event that Close of Escrow fails to occur on or before June 30, 2006 due to
(a) the non-satisfaction by the Agency of the conditions set forth in Sections 2.3.3 (with
respect to the permits and entitlements necessary for the Public Improvements, only) or
2.3.4 above, or (b) the failure of the Developer to have waived or satisfied its due
diligence conditions described in Section 2.3.1 above, then the Developer shall have the
right to terminate this Agreement and cancel the Escrow by written notice to the Agency
and Escrow Holder delivered on or before July 15, 2006 (unless such condition(s) has
been satisfied before the termination notice is delivered), and the Agency shall
thereupon instruct Escrow Holder to refund the Deposit to the Developer, net of one-half
(½) of the escrow cancellation fees. Notwithstanding the foregoing, in the event that
Close of Escrow fails to occur for the reasons described in (a) above, the Agency shall
pay all escrow cancellation fees.
Subject to the provisions of the following paragraph, in the event that Escrow fails
to close on or before June 30, 2006 due to the non-satisfaction by the Developer of the
conditions set forth in Sections 2.3.2 or 2.3.3 (with respect to the permits and
entitlements necessary for the Improvements, only) above, then the Agency shall have
the right to terminate this Agreement and cancel the Escrow by written notice to the
Developer and Escrow Holder delivered on or before July 15, 2006, unless such
condition(s) has been satisfied before the termination notice is delivered), and the
Agency shall thereupon be entitled to receive the Deposit and all accrued interest
thereon in accordance with Section 2.2 hereof, and the Developer shall pay all escrow
cancellation fees.
Notwithstanding the foregoing or anything to the contrary contained herein, in the
event that Escrow fails to close on or before June 30, 2006 due to the non-satisfaction
by the Developer of the conditions set forth in Section 2.3.2 or 2.3.3 above, provided
that Developer has made a good faith attempt to satisfy such conditions and used its
best efforts in a diligent and timely fashion, then Agency shall instruct Escrow Holder to
refund the Deposit to the Developer, net of one-half (½) of the escrow cancellation fees.
Section 2.4 Condition of Title; Title Insurance.
2.4.1 Developer hereby acknowledges that it has received from First
American Title Insurance Company (or another title company mutually approved by the
Parties) (“Title Company”), a preliminary report for CLTA Owner’s Standard Coverage
Policy for the Property (“Preliminary Report”), setting forth all liens, encumbrances,
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easements, restrictions, conditions, pending litigation, judgments, administrative
proceedings, and other matters of record affecting the Agency’s title to the Property
(each an “Exception”), together with copies of all documents relating to Exceptions
referred to in the Preliminary Report. Developer shall approve or disapprove each
Exception shown on the Preliminary Report, or any updated Preliminary Report
requested and received by the Developer, by written notice delivered to the Agency
within ten (10) business days after the Opening of Escrow or, if later, ten (10) business
days after the Developer’s receipt of any updated Preliminary Report. Failure to provide
such written notice shall be deemed Developer’s approval of such Exception(s). Any
title Exceptions that are approved or deemed approved by Developer are referred to
herein as “Permitted Title Exceptions.”
2.4.2 \[Intentionally omitted.\]
2.4.3 Any monetary liens and special assessments affecting the
Property, other than current non-delinquent real property taxes and special
assessments not then due and payable, are hereby disapproved (a “Monetary
Disapproved Exception”). The Agency authorizes Escrow Holder to disburse from the
cash portion of the Purchase Price and/or from any other proceeds otherwise
disbursable to the Agency upon the Close of Escrow, the sum sufficient to discharge
any Monetary Disapproved Exception.
2.4.4 If any Exception other than a Monetary Disapproved Exception is
disapproved (each a “Non-Monetary Disapproved Exception”), then the Agency may, at
the Agency’s option, exercisable at the Agency’s sole and absolute discretion, within
thirty (30) days following expiration of the 10 business day period provided under
Section 2.4.1 above, elect to use its best efforts to cause each Non-Monetary
Disapproved Exception to be discharged, satisfied, released, or terminated, as the case
may be, of record, and in a form that is reasonably satisfactory to Developer, all at the
Agency’s sole cost and expense. If the Agency makes such election, then the Agency
shall so notify the Developer within said 30-day period and shall have until the Close of
Escrow to cause same to be discharged. The Agency shall notify Developer as soon as
reasonably possible if the Agency reasonably believes that the Agency will succeed or
not succeed in causing any such Non-Monetary Disapproved Exception to be removed
at the Close of Escrow, and shall keep Developer informed as to the progress of the
Agency’s efforts in that regard.
If the Agency is unable to obtain a discharge, satisfaction, release,
or termination of a Non-Monetary Disapproved Exception, or if the Agency does not
elect to do so, then Developer shall have the right to:
2.4.4.1 waive the Non-Monetary Disapproved Exception and
proceed with Closing, accepting title to the Property subject to the Non-Monetary
Disapproved Exception, without any price reduction (at which time such
Exception shall be deemed a Permitted Title Exception), or
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2.4.4.2 terminate this Agreement, in which event both Developer
and the Agency shall be relieved of all further obligation and liability to each other
under this Agreement, and all the funds and documents deposited with Escrow
Holder shall be promptly refunded or returned, as the case may be, by Escrow
Holder to the depositing party, less escrow cancellation fees which shall be paid
by the Agency.
2.4.5 At the Close of Escrow, the Agency shall convey fee simple title
to the Property to Developer (or its Permitted Assignee) by grant deed substantially in
the form attached hereto as Exhibit D and incorporated herein by this reference (the
“Grant Deed”). Title to the Property shall be conveyed subject to (i) non-delinquent
current real property taxes and assessments not yet due for the tax year during which
the conveyance occurs, (ii) all Permitted Title Exceptions, (iii) any other matters
expressly contained in the Grant Deed affecting title and any other matters which arise
out of the actions of Developer or its agents, employees or representatives and (iv) the
Easement Agreement in the form attached hereto as Exhibit E and incorporated herein
by this reference (the “Easement Agreement”) (collectively, the “Permitted Exceptions”).
2.4.6 At the Close of Escrow, the Agency shall, at the Agency’s sole
cost and expense, cause to be delivered to Developer a CLTA Owner’s Standard Policy
of Title Insurance, or its equivalent, issued by Title Company in favor of Developer in the
amount of the Purchase Price (the “Title Policy”), insuring that title is vested in
Developer free and clear of all liens, easements, covenants, conditions, restrictions, and
other encumbrances of record, other than the Permitted Exceptions for the Property.
Developer may obtain one or more extended coverage policies of title insurance or
special endorsements at its own cost and expense.
Section 2.5 Escrow Charges. The Agency shall be responsible for any
recording fees, documentary and local transfer taxes, and one-half (½) of any
customary escrow fees and charges arising hereunder. Developer shall be responsible
for one-half (½) of any customary escrow fees and charges arising hereunder. The
Developer represents and warrants to the Agency that Developer has used no broker,
agent, finder or other person in connection with the transaction contemplated hereby to
whom a brokerage or other commission or fee may be payable. The Agency represents
and warrants to Developer that the Agency has used no broker, agent, finder or other
person in connection with the transaction contemplated hereby to whom a brokerage or
other commission or fee may be payable. Each party indemnifies and agrees to defend
and hold the other harmless from any claims resulting from any breach by the
indemnifying party of the warranties, representations and covenants in this Section.
Section 2.6 Conditions to Close of Escrow. The obligation of the Agency and
Developer under this Agreement to close Escrow shall be subject to the satisfaction or
waiver of each of the following conditions:
2.6.1 Developer’s approval of the physical condition of the Property,
which Developer shall approve or disapprove by written notice delivered to the Agency
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within thirty (30) days after the Opening of Escrow. Failure to provide such written
notice shall be deemed Developer’s approval of the physical condition of the Property.
2.6.2 The conditions precedent set forth in Section 2.3 hereof.
2.6.3 Developer’s approval of the condition of title to the Property as
described in Section 2.4 hereof.
2.6.4 That there shall not be any threat at the Close of Escrow of
condemnation of the Property by any entity with the power of eminent domain.
2.6.5 That as of the Close of Escrow the representations and
warranties of both the Agency and the Developer contained in this Agreement are all
true and correct.
2.6.6 The Agency’s delivery of all documents required to be delivered
by the Agency pursuant to Section 2.9.1 hereof.
2.6.7 The Developer’s deposit of all monies as required by Sections
2.2 and 2.9.2 hereof.
2.6.8 The Title Company shall have committed to issue a CLTA
Owner’s Standard Policy of Title Insurance, or its equivalent, with any endorsements
requested by Developer, and with liability equal to the Purchase Price, showing fee
simple title to the Property vested in Developer (or a Permitted Assignee pursuant to
Section 8.13 hereof), subject only to the Permitted Exceptions, at the Close of Escrow.
2.6.9 As of the Close of Escrow, no litigation or proceedings shall have
been instituted or shall be pending or threatened challenging the development of the
Project, the approval of the Master Site Plan, or any other approvals or entitlements
required to be issued by the City or the Agency in connection with the Project.
Section 2.7 Escrow Holder.
2.7.1 Escrow Holder is authorized on the Close of Escrow to:
(i) Pay and charge the Agency and Developer, as applicable, for any
fees, charges and costs payable under this Section, as set forth on the settlement
statements approved by the Parties. Before such payments are made, Escrow Holder
shall notify the Agency and Developer of the fees, charges, and costs necessary to
close under the Escrow, by delivering draft settlement statements to the Parties for their
mutual approval.
(ii) Disburse funds and deliver the deeds and other documents to the
parties entitled thereto or for whose benefit they are written.
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(iii) Record the Grant Deed and the Easement Agreement in the office
of the County Recorder of Riverside County, California.
2.7.2 Any amendment of this Agreement or other escrow instructions
shall be in writing and signed by both the Agency and Developer. At the time of any
amendment, Escrow Holder shall agree to carry out its duties as escrow holder under
such amendment.
2.7.3 Escrow Holder is instructed to send copies of notices, demands
and communications between the Parties to or from the Agency or to or from Developer,
to both Parties to the addresses and in the manner established in Section 8.1 of this
Agreement.
Section 2.8 Condition of the Property.
2.8.1 Developer shall have the right, for the period commencing with
the date hereof through the date that is thirty (30) days after the Opening of Escrow, to
approve or disapprove the physical condition of the Property. During such period,
Developer is hereby granted permission to enter onto the Property for the purpose of
undertaking tests, inspections and other due diligence activities (herein collectively
referred to as “Due Diligence Activities”). Developer expressly agrees as follows: (i) any
activities by or on behalf of Developer, including, without limitation, the entry by
Developer or Developer’s agents, employees, representatives or contractors onto the
Property in connection with the Due Diligence Activities shall not damage the Property
in any manner whatsoever, (ii) in the event the Property is altered or disturbed in any
manner in connection with the Due Diligence Activities, Developer shall immediately
return the Property to the condition existing prior to the Due Diligence Activities, and (iii)
Developer shall indemnify, protect, and defend the Agency and the City (as a third party
beneficiary) against and hold the Agency and the City (as a third party beneficiary)
harmless from, all losses, costs, damages, liabilities, liens, and expenses, including,
without limitation, reasonable attorneys’ fees, arising out of such entry and Due
Diligence Activities by Developer and its agents, employees, representatives or
contractors prior to the Close of Escrow, except to the extent any such losses, costs,
damages, liabilities, and expenses arise out of the negligence or willful acts of the
Agency or the City or its employees, contractors or agents. The indemnification
obligation of Developer contained in this Section 2.8.1 shall survive the Close of Escrow
and the termination of this Agreement. Notwithstanding any provision of this Agreement
to the contrary, Developer shall not have the right to undertake any invasive activities or
tests upon the Property, or any environmental testing on the Property beyond the scope
of a standard “Phase I” investigation, without the prior written consent of Agency of a
workplan for such "Phase II" or invasive testing. If Agency does not respond to or reject
any workplan within five (5) days of Developer's delivery of the written workplan
proposal to Agency pursuant to the notice provisions of this Agreement, then Agency
shall be deemed to have approved the submitted workplan and Developer may proceed
with such testing. Developer shall, and shall cause all of its agents, representatives or
contractors performing the Due Diligence Activities to, procure or maintain a policy of
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commercial general liability insurance issued by an insurer reasonably satisfactory to
Agency covering each of the Due Diligence Activities with a single limit of liability (per
occurrence and aggregate) of not less than $1,000,000.00, and to deliver to Agency a
certificate of insurance evidencing that such insurance is in force and effect, and
evidencing that Agency has been named as an additional insured thereunder with
respect to the Due Diligence Activities. Such insurance shall be maintained in force until
the earlier of the Close of Escrow or the termination of this Agreement.
2.8.2 The Agency shall convey the Property to Developer in an “as is”,
“where-is” condition with all faults and defects, and except for those representations and
warranties expressly set forth in this Agreement, the Agency makes no representations
or warranty whatsoever to Developer as to the condition of the Property or any portion
thereof, including whether the Property contains any Hazardous Materials. Developer
agrees that the Agency has no obligation to remedy any faults, defects, or other
adverse conditions described in any report or other material obtained by Developer or
delivered by the Agency to Developer, including the remediation of any Hazardous
Materials on the Property. Subject to the provisions of Section 2.8.1, Developer
acknowledges that it has inspected the Property and has determined that the Property
appears to be suitable for Developer’s purposes. Developer hereby acknowledges and
agrees that:
2.8.2.1 The Agency has made no representation or warranty with
respect to the Property except for those representations and warranties
expressly contained in this Agreement, and that prior to the Close of Escrow, the
Agency will make no representations and warranties with respect to the Property
other than those expressly contained in this Agreement.
2.8.2.2 It is purchasing the Property with the ultimate objective of
constructing the Improvements thereon, as described in the Scope of
Development, in order to operate a restaurant on the Property.
2.8.2.3 Its decision to purchase the Property will be based on the
results of its analysis and the reports it obtains during the period described in
Section 2.8.1 hereof.
2.8.2.4 The Agency has made no representation or warranty as
to the accuracy or completeness of any reports and other materials prepared by
persons other than the Agency and delivered by the Agency to Developer, and
Developer is not relying on the accuracy or completeness of any such reports or
other materials prepared by persons other than the Agency; provided, however,
the Agency hereby represents and warrants that, to its actual knowledge, there
are no material misrepresentations or material misleading information in any
reports prepared by persons other than the Agency that have been or will be
provided to Developer or its agents by the Agency.
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2.8.2.5 Except as expressly provided in this Agreement, the
Agency has made no representation or warranty with respect to the use, fitness
for a particular purpose, zoning, value, improvements, square footages or any
other condition of the Property.
2.8.2.6 The Agency has disclosed to Developer prior to the
execution of this Agreement, in writing, all material adverse conditions, defects
and other matters relating to the Property of which the Agency has actual
knowledge and which, in the Agency’s sole judgment based on commercially
reasonable standards, would have a material adverse impact upon the Property
or the value thereof; provided that the foregoing disclosure applies only to the
Property and the Master Site itself, and not to general or local economic or
market conditions.
The Developer further agrees that, from and after the Close of Escrow, except
with respect to any claims arising out of the breach of this Agreement or fraud, on the
part of the Agency, the Developer, for itself and its agents, employees, affiliates,
successors and assigns, hereby releases and forever discharges the Agency and the
City and their respective council members, officials, officers, directors, attorneys,
employees, consultants, agents, and representatives, successors and assigns
(collectively referred to herein as the “Agency Affiliates”) from, and waives any right to
proceed against the Agency or the City or the Agency Affiliates for any or all rights,
claims, and demands at law or in equity, including any rights of contribution, whether
known or unknown at the time of this Agreement, which the Developer has or may have
in the future, arising out of the Property or its condition. Without limiting the generality
of the foregoing, the Developer specifically waives the provisions of Section 1542 of the
California Civil Code, which provides:
“A general release does not extend to claims which the creditor does not
know or 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
debtor.”
The Developer hereby specifically acknowledges that it has carefully reviewed
this Section 2.8 and discussed its import with its own independent legal counsel, and
that the provisions of this Section 2.8 are a part of this Agreement.
______________________
Developer’s Initials
2.8.3 The Agency represents and warrants to Developer as of the date
of this Agreement and as of the Close of Escrow Date that:
2.8.3.1 The Agency has taken or will take all actions required
pursuant to its charter documents to duly authorize the execution and
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performance of this Agreement and the execution and performance of all of the
closing documents set forth herein.
2.8.3.2 The Agency’s execution and performance of this
Agreement and the closing documents will not violate any provision of any
mortgage, lease, contract, agreement, order, judgment or decree by which the
Agency is bound. After the execution of this Agreement, the Agency’s
performance of its obligations under this Agreement and the closing documents
will not require the consent of any federal, state or local court or governmental
authority, or any other person or entity, and that the Agency has no outstanding
leases, commitments, or encumbrances against the Property.
2.8.3.3 This Agreement is valid and enforceable against the
Agency in accordance with its terms, and that each instrument to be executed by
the Agency pursuant to this Agreement will, when executed and delivered, be
enforceable in accordance with its terms, subject to bankruptcy, insolvency and
similar laws affecting creditors’ rights generally.
2.8.3.4 To the Agency’s actual knowledge, there are no currently
pending or threatened or proposed, suits, actions, proceedings or investigations
against or initiated by the Agency which relate to or affect the Property or the
Master Site, including without limitation any suits or proceedings challenging the
development of the Project or relating to any change of the zoning laws or the
general or specific plan amendments applicable to the Property. The phrase “to
the Agency’s actual knowledge” as used in this Agreement means to the actual
knowledge of Lauri Aylaian, David Yrigoyen, and/or Carlos Ortega, who are the
officers or employees of the Agency most familiar with the Property and the
Project and primarily responsible for such matters. Neither Lauri Aylaian, David
Yrigoyen, nor Carlos Ortega shall be personally liable for any breach of the
representations or warranties of the Agency contained in this Agreement.
2.8.3.5 The Agency will notify Developer promptly in writing in
the event that the Agency receives written notice of the initiation or threat of any
suit or proceeding challenging or affecting the development of the Project or
relating to any change of the zoning laws or the general or specific plan
amendments applicable to the Property, and if such written notice is received by
the Agency prior to the Close of Escrow, the Developer at its option may
terminate this Agreement and cancel the Escrow by written notice to the Agency
and Escrow Holder delivered on or before July 15, 2006, and the Agency shall
thereupon instruct Escrow Holder to refund the Deposit to Developer, and the
Agency shall pay all escrow cancellation fees.
2.8.4 Developer represents and warrants to the Agency as of the date
of this Agreement and as of the Close of Escrow Date that:
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2.8.4.1 Developer is a California corporation whose place of
business is in Palm Desert, California.
2.8.4.2 Developer’s execution and performance of this
Agreement and the closing documents will not violate any provision of any
mortgage, lease, contract, agreement, organizational documents, instrument,
order, judgment or decree by which Developer is bound.
2.8.4.3 This Agreement is valid and enforceable against
Developer in accordance with its terms, and each instrument to be executed by
Developer pursuant to this Agreement will, when executed and delivered, be
enforceable in accordance with its terms, subject to bankruptcy, insolvency and
similar laws affecting creditors’ rights generally.
Section 2.9 Deposit into Escrow.
2.9.1 Agency’s Deposits into Escrow. The Agency hereby covenants
and agrees to deliver to Escrow Holder prior to the Close of Escrow the following
instruments and documents, the delivery of each of which shall be a condition of the
Close of Escrow:
2.9.1.1 The Grant Deed duly executed and acknowledged by the
Agency;
2.9.1.2 The Easement Agreement duly executed and
acknowledged by the Agency and the City;
2.9.1.3 The Agency’s affidavit as contemplated by California
Revenue and Taxation Code §18662 (“Withholding Affidavit”);
2.9.1.4 A Certification of Non-Foreign Status in accordance with
I.R.C. Section 1445 (the “FIRPTA Certificate”); and
2.9.1.5 Such proof of the Agency’s authority and authorization to
enter into this transaction as the Title Company may reasonably require in order
to issue the Title Policy.
2.9.2 Developer’s Deposits into Escrow. Developer shall deposit with
Escrow Holder, on or prior to the Close of Escrow:
2.9.2.1 The balance of the Purchase Price in accordance with
Section 2.2 hereof;
2.9.2.2 The Grant Deed duly executed and acknowledged by the
Developer; and
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2.9.2.3 The Easement Agreement duly executed and
acknowledged by the Developer.
Section 2.10 Authorization to Record Documents and Disburse Funds.
Escrow Holder is hereby authorized to record the documents and disburse the
funds and documents called for hereunder upon the Close of Escrow, provided each of
the following conditions has then been fulfilled:
2.10.1 The Title Company can issue in favor of Developer the Title
Policy, subject only to the Permitted Title Exceptions.
2.10.2 The Agency shall have deposited into Escrow the documents
required pursuant to Section 2.9.1 hereof, and Developer shall have deposited into
Escrow the Purchase Price as provided in Section 2.2 hereof along with Developer’s
share of Escrow closing costs.
2.10.3 The Agency and Developer shall have confirmed to Escrow
Holder that all of the other closing conditions set forth in Section 2.6 hereof have been
satisfied or waived in writing.
Unless otherwise instructed in writing, Escrow Holder is authorized to record at the
Close of Escrow any instrument delivered through the Escrow if necessary or proper for
issuance of the Title Policy.
Section 2.11 Escrow’s Closing Actions. On the Close of Escrow, Escrow Holder
shall close Escrow as follows:
2.11.1 Record the Grant Deed and the Easement Agreement with the
Riverside County Recorder;
2.11.2 Issue the Title Policy or cause the Title Company to issue the
Title Policy;
2.11.3 Prorate taxes, assessments, rents, and other charges as of the
Close of Escrow in accordance with the settlement statements approved by the Parties;
2.11.4 Disburse to the Agency the Purchase Price less prorated
amounts and charges to be paid by or on behalf of the Agency;
2.11.5 Charge Developer for those costs and expenses to be paid by
Developer pursuant to this Agreement and disburse any net funds remaining after the
preceding disbursements to Developer and Agency;
2.11.6 Prepare and deliver to both Developer and the Agency one
signed copy of Escrow Holder’s closing statement showing all receipts and
disbursements of the Escrow; and
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2.11.7 Deliver to Developer the FIRPTA Certificate and the Withholding
Affidavit.
Section 2.12 Environmental Indemnity. Developer shall indemnify, protect,
defend and hold harmless the City (as a third party beneficiary) and the Agency, and
their respective council members, officials, officers, attorneys, employees, consultants,
agents, and representatives, from and against any and all claims, causes of action,
liabilities, suits, losses, costs, expenses and damages, including but not limited to
attorneys’ fees and court costs, arising out of any claim for loss or damage to any
property, including the Property, injuries to or death of persons, or for the cost of
cleaning up the Property and removing Hazardous Materials or toxic substances,
materials and waste therefrom, by reason of contamination or adverse effects on the
environment, or by reason of any statutes, ordinances, orders, rules or regulations of
any governmental entity or agency requiring the clean-up of any Hazardous Materials
caused by or resulting from any Hazardous Material, or toxic substances or waste
existing on, in, under or in the vicinity of any portion of the Property acquired by
Developer that were not located on, in, under or in the vicinity of such Property or the
Master Site on or before the acquisition of such Property by Developer. The
indemnification obligation of the Developer contained in this Section 2.12 shall survive
the Close of Escrow and the termination of this Agreement.
Section 2.13 Additional Instructions. The Parties shall execute such additional
escrow instructions as may be appropriate or necessary, prepared by the Escrow
Holder, which are not inconsistent herewith. If there is any inconsistency between the
terms hereof and the terms of the additional escrow instructions, the terms hereof shall
control unless an intent to amend the terms hereof is expressly stated in such
instructions.
ARTICLE 3 DEVELOPMENT OF THE PROPERTY.
Section 3.1 Development of the Improvements. Developer shall develop, or
cause to be developed, the Improvements on the Property, in accordance with the
Scope of Development (Exhibit C), the Schedule of Performance (Exhibit B), all
requirements of the City’s Municipal Code, and any and all applicable federal, state and
local laws, rules and regulations in connection with such construction, any conditions of
approval required by the City (including conditions of approval for the subdivision of the
Property), the Plans and Specifications, and all terms, conditions and requirements of
this Agreement. Provided that Agency has timely performed its obligations under
Sections 3.1.1.1 and 3.1.1.2 below, if the Close of Escrow occurs and thereafter
Developer fails to open the Improvements for business as a restaurant by January 1,
2008, then Developer shall pay damages to the Agency for such failure to open by such
date in the sum of Two Hundred Fifty Dollars ($250.00) per day thereafter until it opens
for business, which shall constitute Agency’s liquidated damages for such failure to
open for business by such date; provided, however, if the Agency has not completed its
construction of the Public Improvements by January 1, 2008, and the Agency does not
sustain any damages due to Developer’s failure to open for business by that date, then
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such $250.00 per diem amount shall not be required of the Developer unless and until
the Agency begins to sustain damages proximately caused thereby; provided further,
however, that if Developer relinquishes its right to develop the Improvements pursuant
to this Agreement and reconveys title to the Property to the Agency free of any liens or
encumbrances created by or otherwise arising from the activities of the Developer, such
penalty shall no longer be payable from and after the date of such reconveyance. Such
payment shall be due within ten (10) days after receipt of demand therefor from the
Agency. Such covenant to open shall, however, be subject to extensions due to delays
in construction, equipping and/or permitting caused by reason of any Force Majeure
Delay (as defined in and subject to Section 6.7 hereof). In the event of a Force Majeure
Delay, Developer’s nonperformance shall be excused, and the date provided for above
shall be extended by the number of days constituting the Force Majeure Delay. The
Agency Board shall have the right to waive all or a portion of the Two Hundred Fifty
Dollars ($250.00) per day in damages in the Agency Board’s sole and absolute
discretion.
3.1.1 Agency’s Obligations.
3.1.1.1 The Agency shall deliver the Property at the Close of
Escrow with a finished (over-excavated, backfilled, rough graded, compacted and
certified) building pad, and with available temporary power, fire protection and
water service.
3.1.1.2 The Agency shall construct, or cause to be constructed
and completed, prior to that date which is nine (9) months after the Close of
Escrow, the eighteen (18) parking spaces and all utilities described in Exhibit C
as Public Improvements. Developer and Agency acknowledge that parking
availability is of particular concern to Developer. Both parties understand that
205 public parking spaces have currently been constructed, and that 18 more
spaces will be constructed by the Agency under the terms of this Agreement, and
acknowledge that this number of spaces will be sufficient to serve the
improvements currently constructed on the Master Site, plus the planned
Henderson Community Building (as defined below) and the Improvements. In
the event that the Agency constructs (or permits the construction of) additional
building(s) on Parcel 1 of the Master Site, Agency agrees to construct additional
parking spaces in the full quantity required for such additional new building(s) by
local ordinance, without reducing such number by the number of parking spaces
which are subject to shared use agreements between the Agency and the users
of the Master Site.
3.1.1.3 The Agency shall complete the construction of a
community use building (the “Henderson Community Building”) on Parcel 12 and
the landscaped gardens (the “Gardens/Open Space”) on Parcels 2 and 12, as
designated on Parcel Map No. 30226, all in accordance with the Master Site
Plan, within the time frame described in Exhibit B.
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3.1.1.4 In the event that Agency fails to timely perform any of its
obligations under the foregoing Sections 3.1.1.1, 3.1.1.2 or 3.1.1.3 within the
prescribed time periods, then the time period for Developer to complete
construction of the Improvements and open its restaurant for business shall
automatically be extended by the same number of days that the Agency is
delinquent in completing such obligations.
3.1.1.5 Agency shall not cause or permit any modification in the
(i) access to and from the Property or the Improvements from the adjoining
streets Highway 111, Painters Path, and El Paseo or (ii) visibility of the signage
advertising La Spiga, if any, from the common areas of the Property and the
adjoining streets Highway 111, Painters Path, and El Paseo, all as designated on
the Master Site Plan, without the approval of Developer which shall not be
unreasonably withheld, delayed or conditioned, except to the extent such
proposed modification does not materially adversely affect such access to and
from the Property or the Improvements or visibility of the signage as described
herein, in which case the Agency shall notify Developer of such proposed change
but shall not be required to obtain Developer’s approval thereof.
3.1.1.6 Agency shall keep the Gardens/Open Space parcels
depicted on the site Master Plan as open space property during the term of this
Agreement.
3.1.1.7 In the event that the Agency constructs, or allows to be
constructed, any monument or other joint signage on Painters Path, such joint
signage shall include La Spiga’s name and logo.
Section 3.2 Agency’s Right to Review Plans and Specifications. In connection
with construction of the Improvements, Developer shall comply in all respects with Plans
and Specifications approved by the Agency and/or the City in accordance with this
Agreement. The Agency shall have the right to review all Plans and Specifications for
the Improvements to ensure that the Improvements are constructed to a high quality as
described in the Scope of Development in the Agency’s reasonable judgment. This
approval is in addition to that required by the City Council or its applicable subdivisions
(such as the Planning Commission, Department of Building and Safety and/or the
Department of Public Works). “Plans and Specifications” in this Section 3.2 includes
Basic Concept Drawings, Preliminary Drawings and Final Construction Drawings.
Section 3.3 Preliminary Site Plan. By the date set forth in the Schedule of
Performance, Developer shall prepare and submit to the Agency, for the Agency’s prior
review and written approval, a Preliminary Site Plan and related documents for the
Improvements, which Preliminary Site Plan shall be consistent with the Scope of
Development and with the Master Site Plan.
Section 3.4 Basic Concept Drawings. By the date set forth in the Schedule of
Performance, Developer shall prepare and submit to the Agency, for the Agency’s prior
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review and written approval, Basic Concept Drawings and related documents for the
Improvements, which plans and drawings shall be consistent with the Scope of
Development and with the adjacent uses planned for the 12 acre parcel on which the
planned restaurant is situated, in accordance with the Master Site Plan. Developer may
make changes and modifications to the Basic Concept Drawings only after obtaining the
Agency’s prior written consent, which consent shall not unreasonably be withheld or
delayed. The construction of the Improvements on the Property shall be as generally
established in the Basic Concept Drawings except for such changes as may be mutually
agreed upon by Developer and the Agency. Approved Basic Concept Drawings will be
the basis for preparation of Preliminary Drawings and to initiate further detail and design
features on a larger scale.
Section 3.5 Preliminary Drawings. Developer shall prepare and submit to the
Agency, for the Agency’s prior review and written approval, Preliminary Drawings based
upon the Scope of Development and the Basic Concept Drawings approved by the
Agency. The Preliminary Drawings shall include, but not be limited to, floor plans, a site
plan, elevations, and outline specifications for the Improvements.
Section 3.6 Landscaping. Developer shall prepare and submit to the Agency,
for the Agency’s prior review and written approval, final landscaping plans for the
Improvements, which shall be included with the Final Construction Drawings.
Section 3.7 Final Construction Drawings and Related Documents. After receipt
of the Agency’s approval of Preliminary Drawings, Developer shall prepare and submit
to the Agency, for the Agency’s prior review and written approval, Final Construction
Drawings for the applicable development phase of the Improvements, which shall
include complete construction documents, site development elevations, final
landscaping plans, and related documents. The Final Construction Drawings shall be in
sufficient detail necessary to obtain all applicable building permits.
Section 3.8 Approval of Construction Plans. The Agency shall approve or
disapprove such plans, drawings, and related documents referred to in Sections 3.3
through 3.7 above, within fifteen (15) business days of receipt of full and complete
copies thereof. Any disapproval shall state in writing the reasons for disapproval.
Developer, upon receipt of a disapproval, shall revise such portion of the plans,
drawings or related documents in a manner that satisfies the reasons for disapproval
and shall resubmit such revised portions to the Agency as soon as possible after receipt
of the notice of disapproval. The Agency shall approve or disapprove such revised
portions in the same manner as provided in this Agreement for approval or disapproval
of plans, drawings, and related documents initially submitted to the Agency. Any items
submitted to and approved by the Agency shall not be subject to subsequent
disapproval by the Agency, but, if required by applicable law (including but not limited to
policies and procedures, whether written or unwritten) to be approved by the City or its
applicable subdivisions, may be disapproved by the City or its applicable subdivisions.
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Section 3.9 Construction Contract. Developer shall retain one or more
reputable and financially responsible general contractors (each, a “General Contractor”)
to undertake the construction of the Improvements. Each General Contractor shall be
acceptable to and approved in writing by the Agency, licensed in California, and
experienced in completing the Improvements to be constructed on the Property by
Developer. On or before the date set forth in the Schedule of Performance, Developer
shall enter into a written contract or contracts (the “Construction Contract(s)”) with the
General Contractor(s) for performing the work constituting the construction of all of the
Improvements. Each such Construction Contract shall obligate the General Contractor
to commence and complete such construction in accordance with this Agreement and
all applicable federal, state and local laws, rules and regulations. Each such
Construction Contract shall provide for retention of at least ten percent (10%) from each
progress payment (except there shall be no retention for any items excused from
retention as specified in the Construction Contract) until the final payment and said final
payment shall not be paid to the General Contractor until the portion of the
Improvements covered by such Construction Contract shall have been completed to
Developer’s satisfaction, and Developer shall have obtained all appropriate lien waivers
from the General Contractor and its subcontractors, or bonds acceptable to Developer
in form and amount, insuring against loss arising from any mechanics’, laborers’,
materialmen’s or other like liens filed against the Property.
Section 3.10 \[Intentionally omitted.\]
Section 3.11 Changes in Construction Drawings. If Developer desires to make
any material changes in the Final Construction Drawings and related documents after
their approval by the Agency, Developer shall submit the proposed changes to the
Agency for its approval. If approved, the Agency shall notify Developer of such
approval in writing within thirty (30) days after submission to the Agency. Developer
shall revise such portions as are disapproved and resubmit them to the Agency within
thirty (30) days of receipt of written disapproval.
Section 3.12 Cost of Construction. The costs for developing and constructing
the Improvements shall be borne solely by Developer.
Section 3.13 Rights of Access. In addition to those rights of access to and
across the Property to which the Agency and the City may be entitled by law, members
of the staffs of the Agency and the City shall have a reasonable right of access to the
Property, without charge or fee, at any reasonable time, upon reasonable notice to
Developer (which may be telephonic notice to Developer or Developer’s construction
foreman) to inspect the work being performed at the Property. Developer may require
that a representative of Developer accompany the Agency’s or City’s staff members
during any such inspection. The Agency and City shall indemnify, defend and hold
Developer and its Affiliates, employees, contractors and agents (collectively,
“indemnitees”) harmless against any and all liabilities, damages, injuries, claims, costs
and expenses (including without limitation reasonable attorneys’ fees) asserted against
or incurred by any such indemnitee to the extent arising from the negligent or unlawful
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acts or omissions of the Agency, the City or their respective employees, contractors or
agents in connection with exercising such right of access.
Section 3.14 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, state and local occupation, safety and health laws, rules, regulations
and standards. Without limiting the foregoing, Developer shall construct or cause the
Improvements to be constructed in full compliance with all applicable provisions of state,
federal and local prevailing wage laws and public bidding requirements and all rules and
regulations promulgated pursuant thereto, including, without limitation, the prevailing
wage laws of the State of California. Developer agrees to indemnify, defend and hold
Agency harmless from and against any cost, expense, claim, charge or liability relating
to or arising directly or indirectly from any breach by or failure of Developer or its
contractor(s) or agents to comply with such laws, rules or regulations. The Developer’s
indemnification obligations set forth in this Section 3.14 shall survive the recordation of
the Grant Deed and the termination of this Agreement.
Section 3.15 City and Other Governmental Agency Permits and Approvals.
Before commencement of construction or development of any work or improvement on
the Property, Developer shall (at Developer’s sole expense) secure, or cause to be
secured, any and all permits which may be required by the City or any other
governmental agency having jurisdiction over such construction or development.
Section 3.16 Anti-discrimination During Construction. Developer, for Developer
and Developer’s successors and assigns, agrees that Developer shall not discriminate
against any employee or applicant for employment because of age, sex, marital status,
race, handicap, color, religion, creed, ancestry, or national origin in the construction of
the Improvements.
Section 3.17 Taxes, Assessments, Encumbrances and Liens. The Developer
shall pay prior to delinquency, at such times and in such manner as to prevent any
penalty from accruing, or any lien or charge from attaching to the Property, all real
estate taxes and assessments on the Property or any portion thereof assessed and
levied subsequent to conveyance of fee title to the Property to the Developer.
Section 3.18 No Agency Created. In performing this Agreement, Developer is an
independent contractor and not the agent of the Agency or the City. The Agency and
the City are not agents of Developer. Neither the Agency nor the City shall have any
responsibility whatsoever for payment to any contractor or supplier of Developer.
Developer shall not have any responsibility whatsoever for payment to any contractor or
supplier of the Agency or the City.
Section 3.19 Consent by City. Any consent or approval by the Agency required
by this article shall be deemed satisfied or given to the extent the City consents or
approves any such matter or issues a discretionary permit or approval.
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Section 3.20 Certificates of Completion. Upon Developer’s completion of the
construction of the Improvements, Developer shall apply to the Agency for a certificate
of completion for the Improvements (the “Certificate of Completion”). The Agency’s
issuance of the Certificate of Completion for the Improvements shall constitute the
acknowledgment of the Agency that Developer has complied in all respects with its
development obligations set forth in Article 3 of this Agreement. The Agency shall issue
the Certificate of Completion upon (i) the issuance by the City of a final Certificate of
Occupancy for the Improvements, (ii) the Agency’s determination (in the exercise of its
reasonable judgment) that the Developer has satisfied its obligations to develop and
construct the Improvements as described in this Article 3, and (iii) that the Developer is
not then in default under this Agreement.
ARTICLE 4 LIMITATIONS ON TRANSFERS AND SECURITY INTERESTS.
Section 4.1 Restriction on Transfer of Developer’s Rights and Obligations.
4.1.1 Except as otherwise expressly provided herein, prior to issuance
of the Certificate of Completion for the Improvements, Developer shall not sell, assign,
transfer, mortgage, hypothecate, or convey (collectively, a “Transfer”) the Property or
any part thereof or any of Developer’s rights or obligations hereunder, without the
Agency’s prior written consent, which consent may be granted or withheld in the
Agency’s sole and absolute discretion, except for the execution of one or more
mortgages, deeds of trust and related instruments securing Developer’s construction
loan, as described in Section 3.10 hereof, and further excepting the assignment by
Developer to an Affiliate of Developer, including any entity that is controlled by Connie
and Vincent Cultraro. Developer acknowledges that the identity of Developer is of
particular concern to the Agency, and it is because of Developer’s identity that the
Agency has entered into this Agreement with Developer. Except for any Transferee
approved or expressly permitted pursuant to this Section 4.1, and except for any Holder
(defined in Section 4.2) that has taken possession of the Property, no voluntary or
involuntary successor in interest of Developer shall acquire any rights or powers under
this Agreement. No Transfer without the Agency’s prior written approval as provided
herein shall be deemed effective or release Developer from the obligations of Developer
hereunder.
4.1.2 After the issuance of the Certificate of Completion for the
Improvements, and the opening of the Improvements for business, Developer shall
have the right to Transfer the Property to any party (a “Transferee”) provided that:
4.1.2.1 the Transferee (and/or its management company, if any)
has the experience, quality, character, trade record, financial ability and
reputation, as determined by Agency in its reasonable business judgment, to
own, lease and manage the Improvements; and
4.1.2.2 the Transferee assumes in writing all then existing
obligations of Developer set forth in this Agreement.
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In the event that Developer desires to Transfer the Property pursuant to
this Section 4.1.2, Developer shall so notify the Agency, and shall provide the Agency
with all pertinent information regarding the Transferee. The Agency shall approve or
disapprove the Transferee (in its reasonable business judgment) within thirty (30) days
after receipt of written notice of Developer’s intention to make the Transfer and all
documentation regarding the proposed Transfer and Transferee reasonably requested
by the Agency. Notwithstanding the foregoing, Developer shall have the right to
Transfer the Property at any time to an Affiliate of Developer, including an entity that is
controlled by Connie and Vincent Cultraro, without the prior approval of the Agency.
Upon the completion of any Transfer to a Transferee approved by the Agency as
provided in this Section 4.1.2, the Transferee shall assume in writing all of Developer’s
rights and obligations under this Agreement, and Developer shall be released from all
further liabilities and obligations under this Agreement.
Section 4.2 Mortgages and Deeds of Trust. Notwithstanding any provisions of
Section 4.1 to the contrary, Developer shall have the right to mortgage or hypothecate
its interest in the Property and the Improvements pursuant to one or more mortgages,
deeds of trust, sales and leaseback, or any other form of encumbrance or conveyance
required for any reasonable method of financing from an institutional or other lender
approved in writing by the Agency (which approval shall not unreasonably be withheld,
conditioned or delayed), for the purpose of securing loans of funds to be used for
financing the direct and indirect costs of the Improvements (including land development
costs, reasonable and customary developer fees, loan fees and costs, and other normal
and customary project costs), for refinancing the construction financing with permanent
financing, or for refinancing any permanent financing. Any institutional lender of record
holding any such mortgage, deed of trust, or other security instrument authorized by this
Agreement shall be referred to herein as a “Holder.”
Section 4.3 Rights of Holders. The Agency shall deliver a copy of any notice or
demand to Developer concerning any breach or default by Developer under this
Agreement to each Holder who has previously made a written request to the Agency for
special notice hereunder and whose name and address has been provided in writing to
the Agency. Any notice of breach or default by Developer hereunder shall not be
effective against any such Holder unless given to such Holder. Such Holder shall have
the right at its option to cure or remedy any such default, as provided in this Agreement,
and to add the cost thereof to the secured debt and the lien of its security interest. If
such breach or default can only be remedied or cured by such Holder upon obtaining
possession, such Holder may remedy or cure such breach or default within a
reasonable period of time after obtaining possession, provided such Holder seeks
possession with diligence through a receiver or foreclosure.
Section 4.4 Noninterference with Holders. The provisions of this Agreement do
not limit the right of Holders to foreclose or otherwise enforce any mortgage, deed of
trust, or other security instrument encumbering all or any portion of the Property, and
the Improvements thereon, or to pursue any remedies for the enforcement of any
pledge or lien encumbering such portions of the Property. In the event of a foreclosure
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sale under any such mortgage, deed of trust or other lien or encumbrance, or sale
pursuant to any power of sale contained in any such mortgage or deed of trust, the
purchaser or purchasers and their successors and assigns, and such portions of the
Property shall be, and shall continue to be, subject to all of the conditions, restrictions
and covenants of all documents and instruments recorded pursuant to this Agreement,
including, without limitation, the restrictions set forth in the Grant Deed. The Agency
agrees to execute such further documentation regarding the rights of any Holder as is
customary with respect to construction or permanent financing, as the case may be, to
the extent that such documentation is reasonably requested by any Holder and is
reasonably approved by the Agency.
ARTICLE 5 USE OF THE PROPERTY.
Section 5.1 Use of Property. For a period of twenty (20) years after the Close
of Escrow (the “Term of Use”), Developer and its lessees, successors and assigns shall
use the Property and the Improvements and every part thereof only for the operation of
a fine dining restaurant and ancillary uses, and any other uses expressly permitted by
the Agency. For purposes of this Agreement, the parties acknowledge and agree that
“fine dining” shall include but not necessarily be restricted to restaurants of the grade
and quality of the existing La Spiga restaurant located on El Paseo in Palm Desert,
which is generally recognized as one of the finest dining facilities in the Coachella
Valley, and that the term “fine dining” is meant to encompass lesser echelons of fine
dining and shall not be restricted to the “finest” of the dining facilities in the Coachella
Valley.
5.1.1 During the Term of Use, Developer shall maintain the Property
and the Improvements thereon in good condition and repair and in a manner
substantially comparable to the highest level of maintenance provided by owners of
developments in the Coachella Valley substantially similar to and of similar age as the
Improvements.
5.1.2 The maintenance costs relating to the common area as more
particularly described in Exhibit H attached hereto, including but not limited to exterior
lighting, sidewalk and pavement sweeping, periodic restriping or resurfacing, landscape
maintenance and landscape water consumption of the Parking Lot Site described in the
Easement Agreement (Exhibit E attached hereto), shall be included within the common
area expenses shared by all owners/occupants of the property included within the
Master Site. Developer shall be responsible for the monthly payment to the Agency of
its pro rata share of the common area expenses required to maintain the Parking Lot
Site described in this Section 5.1.2. Developer’s pro rata share of such common area
expenses shall be based on the ratio of the number of parking spaces required for the
Improvements, which is acknowledged by the Parties to be sixty (60), by the total
number of parking spaces available within the Master Site. Developer’s obligation to
pay its pro rata portion of common area expenses shall not commence until the later to
occur of (a) the date that Developer’s restaurant opens for business, or (b) the date that
completion of construction of all of the following have occurred: (i) all Public
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Improvements; (ii) the Henderson Community Building; and (iii) Gardens/Open Space,
all in accordance with the Master Site Plan.
5.1.3 Notwithstanding the foregoing or anything to the contrary
contained herein, in the event that a change in use occurs with respect to the Parcel 12
of the Master Site which is not compatible with the operation of the La Spiga restaurant
on the Property as reasonably determined by both the Agency and the Developer, then
(a) the 20-year use restriction described in Section 5.1 above shall terminate, and (b) for
as long as the Agency owns Parcel 12 and is not in default under this Agreement, the
Agency shall have the right of first refusal with respect to the sale of the Property. In the
event that Developer decides to sell the Property, the Agency shall have a right of first
refusal with respect to the purchase of the Property upon the same terms and
conditions that Developer is willing to accept from a third party purchaser. Prior to any
sale to a third party purchaser, Developer shall first deliver notice (the “Sale Notice”) of
a proposed sale to the Agency which shall specify the price to be paid to Developer for
the Property and all other terms and conditions of the sale. The Agency shall have
thirty (30) days after receipt of the Sale Notice to accept or reject the purchase and sale
of the Property on the terms and conditions set forth therein. If the Agency fails to notify
Developer within such thirty (30) day period that it elects to purchase the Property on
the same terms and conditions as set forth in the Sale Notice, the Agency shall be
deemed to have waived its right to purchase the Property. Within ten (10) days after
notifying Developer of its acceptance of the terms and conditions set forth in the Sale
Notice, the Agency and Developer shall execute any documents necessary to effect the
sale of the Property as contemplated in the Sale Notice. If the Property is not
purchased by the Agency in accordance with the above provisions, then Developer may
sell the Property to the third party, but on only those terms specified in the Sale Notice,
and if the Developer decides to sell the Property on terms other than those specified in
the Sale Notice, the Agency shall be given the same notice and right of first refusal
described above with respect to such proposed sale. For purposes of this paragraph,
the Parties acknowledge and agree that uses which are compatible with the operation of
the La Spiga restaurant on the Property include, but are not limited to, Class A office
space, an art gallery, and high-end boutiques retail.
Section 5.2 Obligation to Refrain from Discrimination. Developer covenants
and agrees for itself and its successors and assigns, and for every successor in interest
to the Property, or any part thereof, and their rights under this Agreement, that there
shall be no discrimination against or segregation of any person, or group of persons, on
account of sex, marital status, age, handicap, race, color, religion, creed, national origin
or ancestry in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment
of the Property, and Developer (itself or any person claiming under or through
Developer) shall not 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, sublesses, or vendees of the Property or any portion
thereof.
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Section 5.3 Form of Nondiscrimination and Non-Segregation Clauses.
Developer shall refrain from restricting the rental, sale or lease of the Property or any
portion thereof, on the basis of sex, age, handicap, marital status, race, color, religion,
creed, ancestry or national origin of any person. All deeds, leases or contracts shall
contain or be subject to substantially the following nondiscrimination or non-segregation
clauses:
1. In deeds: “The grantee herein covenants by and for itself, its successors
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 account of
race, color, creed, religion, sex, sexual orientation, marital status, ancestry, national
origin, age, physical handicap in the sale, lease, sublease, transfer, use, occupancy,
tenure or enjoyment of the land herein conveyed, 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 land herein
conveyed.”
2. In leases: “The lessee herein covenants by and for itself, its successors
and assigns, and all persons claiming under or through them, 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 account of race, color, creed, religion, sex, sexual
orientation, marital status, ancestry, national origin, age, physical
handicap in the leasing, subleasing, renting, transferring, use, occupancy,
tenure or enjoyment of the land herein , nor shall lessee itself, or any
person claiming under or through it establish or permit such practice or
practices of discrimination of segregation with reference to the selection,
location, number, use or occupancy of tenants, lessees, sublessees,
subtenants or vendees in the land herein.”
3. In contracts relating to the sale or transfer of the Property, or any interest
therein: “There shall be no discrimination against or segregation of any person or group
of persons on account of race, color, creed, religion, sex, sexual orientation, marital
status, ancestry, national origin, age, physical handicap in the sale, lease, sublease,
transfer, use, occupancy, tenure or enjoyment of the land, nor shall the transferee 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 land.”
Section 5.4 \[Intentionally Omitted\]
Section 5.5 Exclusive Use Rights. For so long as (a) this Agreement is in
effect, (b) Developer is operating a fine dining restaurant on the Property featuring
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Italian cuisine, and (c) Developer is not in material default hereunder beyond any
applicable notice, cure and appeal periods, Agency shall not permit any property within
the Master Site (other than the Property) to be used for the operation of a restaurant
which features (other than as an incidental item) Italian-inspired cuisine. For purposes
of this paragraph, the phrase “features (other than as an incidental item) Italian-inspired
cuisine” means that more than ten percent (10%) of the items on any menu are
Italian-inspired or that the restaurant has an Italian name. Without limiting the generality
of the foregoing, any restaurant that promotes itself as offering Italian cuisine, or is listed
in any advertisement, directory or dining guide as Italian or otherwise Italian-inspired,
will be deemed to be a restaurant which features (other than as an incidental item)
Italian-inspired cuisine. The Agency shall include appropriate provisions and
enforcement procedures in any agreement, any covenants, conditions and restrictions
and/or other appropriate documents and instruments with any purchaser(s) or
developer(s) of other portions of the Master Site to implement and set forth the
restrictions set forth in this paragraph.
ARTICLE 6 EVENTS OF DEFAULT, REMEDIES AND TERMINATION.
Section 6.1 Default – Definition. Subject to the provisions of Article 2 hereof
and the last paragraph of this Section 6.1 (regarding Developer appeal rights), the
occurrence of any or all of the following shall constitute a default (“Default”) under this
Agreement:
6.1.1 Any breach of this Agreement by any Party involving the payment
of money, and the continuance of such breach for a period of thirty (30) days after the
non-defaulting Party has given written notice to the defaulting Party, as specified in
Section 8.1;
6.1.2 A breach of any material term of this Agreement by any Party not
involving the payment of money and failure of such Party to cure such breach within
thirty (30) days after the non-defaulting Party has given written notice to the defaulting
Party, as specified in Section 8.1 hereof; provided, however, if such breach is not
reasonably curable within such thirty (30) day period, then such Party shall be deemed
in Default only if such Party does not commence to cure such breach within such thirty
(30) day period and thereafter fails to diligently prosecute such cure to completion within
ninety (90) days thereafter;
6.1.3 Developer’s Transfer (as defined in Section 4.1.1), or the
occurrence of any involuntary Transfer, of the Property or any part thereof or interest
therein, or of any rights or obligations of Developer under this Agreement, in violation of
this Agreement;
6.1.4 Developer’s failure or refusal to keep in force and effect any
material permit or approval with respect to construction of the Improvements, and
Developer’s failure to cure such breach within thirty (30) days after notice from the
Agency of Developer’s breach; provided, however, if such breach is not reasonably
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curable within such thirty (30) day period, then Developer shall be deemed in Default
only if Developer does not commence to cure such breach within such thirty (30) day
period and thereafter fails to diligently prosecute such cure to completion within ninety
(90) days thereafter; or
6.1.5 Filing of a petition in bankruptcy by or against any Party or
appointment of a receiver or trustee of any property of any Party, or an assignment by
any Party for the benefit of creditors, or adjudication that such Party is insolvent by a
court, and the failure of such Party to cause such petition, appointment, or assignment
to be removed or discharged within ninety (90) days thereafter.
Notwithstanding the foregoing, Developer shall not be deemed to be in Default
under this Agreement unless and until the appeals process undertaken by Developer in
accordance with the following requirements of this paragraph results in a formal written
finding and notice of Default by the Agency after Developer’s appeal rights hereunder
are exhausted, and the post-appeal ninety (90) day cure period described below has
expired. All references in this Agreement to the Developer’s Default shall mean a
Default by Developer after all applicable cure periods and appeals as prescribed in this
paragraph. In the event of an alleged Default by Developer under Section 6.1.1, 6.1.2,
or 6.1.4 above after the expiration of any applicable cure period, the Agency shall notify
Developer in writing if the Agency determines that Developer has not cured the alleged
Default (the “Declaration of Default”). Developer shall have the right to file an appeal of
the Declaration of Default with the Agency Board within seven (7) business days after
Developer receives the Declaration of Default, pursuant to the “Notices” provisions of
Section 8.1 below. The Agency Board shall thereupon give Developer the opportunity
to be heard before the Agency Board and to contest and appeal the Declaration of
Default. The Agency Board shall provide Developer with written notice of its findings
and decision on such appeal (the “Agency Board Appeal Decision”), pursuant to the
“Notices” provisions of Section 8.1 below. If the Declaration of Default is not overturned
on appeal under this paragraph, then Developer shall have thirty (30) days after its
receipt of the Agency Board Appeal Decision to cure the alleged Default; provided,
however, if such breach is not reasonably curable within such thirty (30) day period,
then Developer shall have ninety (90) days after its receipt of the Agency Board Appeal
Decision to cure the alleged Default so long as Developer commences to cure such
breach within such thirty (30) day period and thereafter diligently prosecutes such cure
to completion within ninety (90) days thereafter. If Developer fails to cure the alleged
Default within such time period, the Developer shall be deemed to be in Default under
this Agreement. In the event that a Declaration of Default under Section 6.1.1 hereof is
not overturned on appeal under this paragraph, then Developer shall pay a late charge
equal to ten percent (10%) of the overdue amount, plus interest accrued from the date
such amount was due until paid by Developer at the maximum rate then allowable by
law, and the attorneys’ fees and costs incurred by Agency in connection with such
Default.
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Section 6.2 Remedies in the Event of Default.
6.2.1 Remedies Prior to the Close of Escrow. In the event of a Default
by any Party prior to the Close of Escrow, the non-defaulting Party shall have the right
to pursue any and all of its remedies provided in Article 2 hereof, provided it is not in
breach of any of its obligations under this Agreement, by delivering written notice
thereof to the defaulting Party and to Escrow Holder.
6.2.2 Remedies After the Close of Escrow. In the event of a Default by
any Party after the Close of Escrow, a non-defaulting Party shall be entitled to the
following remedies, as applicable:
(i) A defaulting Party shall be liable to the non-defaulting Party for all
damages, costs and losses incurred by the non-defaulting Party, and the non-defaulting
Party may seek against the defaulting Party any available remedies at law or equity,
including but not limited to the right to receive damages or to pursue an action for
specific performance.
(ii) Prior to the issuance of the Certificate of Completion, the Agency
(in the exercise of its absolute direction) may cause the Title to the Property (and any
Improvements located thereon) to revert to the Agency (as provided in the Grant Deed).
In the event of any such reversion, Developer shall promptly execute a grant deed to
the Agency conveying fee title to the Property and the Improvements free and clear of
all liens and encumbrances created or permitted by the Developer other than utility
easements and reasonable access easements. The Agency agrees that any of its
reversionary rights hereunder shall be subordinate and inferior to any such utility
easements and reasonable access easements.
Section 6.3 Liberal Construction. The rights established in this Article are to be
interpreted in light of the fact that the Agency will convey the Property to Developer for
development and operation of the Improvements thereon and not for speculation in
undeveloped land or for construction of different improvements. Developer
acknowledges that it is of the essence of this Agreement that Developer is obligated to
complete construction of all of the Improvements.
Section 6.4 No Personal Liability. No representative, agent, attorney,
consultant, or employee of the Agency or City shall personally be liable to the Developer
or any successor in interest of Developer, in the event of any Default or breach by the
Agency, or for any amount which may become due to Developer or any successor in
interest, on any obligation under the terms of this Agreement.
Section 6.5 Rights and Remedies are Cumulative. The rights and remedies of
the Parties are cumulative, and the exercise by either Party of one or more of such
rights or remedies shall not preclude the exercise by it, at the same time or different
times, of any other rights or remedies for the same Default or any other Default.
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Section 6.6 Inaction Not a Waiver of Default. Any failures or delays by either
Party in asserting any of its rights and remedies as to any Default shall not operate as a
waiver of any Default or of any such rights or remedies, or deprive either such Party of
its rights to institute and maintain any actions or proceedings which it may deem
necessary to protect, assert or enforce any such rights or remedies. The acceptance by
a Party of less than the full amount due from the other Party shall not constitute a
waiver of such Party’s right to demand and receive the full amount due, unless such
Party executes a specific accord and satisfaction.
Section 6.7 Force Majeure. Notwithstanding anything to the contrary in this
Agreement, the Developer’s unexcused material failure to complete the Improvements
required by the Developer to be completed according to this Agreement, the Scope of
Development, and Schedule of Performance shall be a breach and Default hereof,
provided, however, such nonperformance shall be excused, and performance of any
other covenant by Developer hereunder (except for the payment of money or the
obtaining of financing) within a specified time period shall be extended, when
performance is prevented or delayed by reason of any of the following forces
reasonably beyond the control of the Developer (a “Force Majeure Delay”): (i) actual,
industry wide delay or failure to perform by Developer affecting all similar works of
construction in the Coachella Valley, California, area, attributable to any strike, lockout
or other labor or industrial disturbance (whether or not on the part of the employees of
either Party hereto), civil disturbance, future order claiming jurisdiction, act of the public
enemy, war, riot, sabotage, blockade, embargo, inability to secure customary materials,
supplies or labor through ordinary sources by reason of regulation or order of any
government or regulatory body; (ii) delay attributable to lightning, earthquake, fire, flood,
washout, or any other similar act of God; (iii) delay by the Agency or City in processing
or approving any permits, inspections or other matters requiring the approval or consent
of the City or Agency hereunder or under applicable law, which delay is not directly or
indirectly due to the acts or omissions of Developer and which extends beyond the
usual and customary time period for such processing or approval; or (iv) any other delay
that is beyond the reasonable control of the Developer. Any such prevention, delay or
stoppage due to any Force Majeure Delay shall extend the deadline for performance for
the same number of days as the Force Majeure delay, so long as Developer provides
written notice of such Force Majeure Delay to Agency within ten (10) days of its
occurrence.
ARTICLE 7 INDEMNITY; INSURANCE.
Section 7.1 Indemnification Agreement: From the execution of this Agreement,
the Developer to the full extent permitted by law, defends, indemnifies and holds
harmless City and the Agency, its employees, volunteers, agents and officials, from any
liability, claims, suits, actions, arbitration proceedings, administrative proceedings,
regulatory proceedings, losses, expenses or costs of any kind, whether actual, alleged
or threatened, reasonable attorney fees incurred by Agency, court costs, interest,
defense costs including expert witness fees and any other costs or expenses of any
kind whatsoever without restriction or limitation incurred in relation to, as a consequence
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of or arising out of or in any way attributable actually, allegedly or impliedly, in whole or
in part to the performance of this Agreement related directly to or indirectly to, or arising
out of or in connection with:
7.1.1 the negligent or intentional acts or omissions of Developer or its
employees, contractors or agents in connection with the development of the Project or
the use, ownership, management, occupancy or maintenance of the Property or the
Project;
7.1.2 any Default by the Developer hereunder, or
7.1.3 any of the Developer’s activities in conjunction with the Project,
regardless of whether such losses and liabilities shall accrue or be discovered before or
after termination or expiration of this Agreement, except or to the extent such losses or
liabilities are caused by the negligence or intentional wrongful acts of the City, the
Agency, or their respective employees, contractors or agents, or the breach of this
Agreement by the Agency. The Agency and the City may in their discretion participate
in the defense of any such legal action. The indemnity obligations of the Developer
contained in this Section 7.1 shall survive the recordation of the Grant Deed and the
termination of this Agreement. All obligations under this Section 7.1 are to be paid by
the Developer as they are incurred by the Agency.
Without affecting the rights of Agency under any provision of this
Agreement or this Section 7.1, the Developer shall not be required to indemnify and
hold harmless Agency, City or other indemnified parties as set forth above to the extent
such liability is attributable to the negligent or intentional acts or omissions of Agency,
City, or their employees, contractors or agents, provided such fault is determined by
agreement between the parties or the findings of a court of competent jurisdiction.
The Agency agrees to indemnify, defend and hold harmless Developer, its
Affiliates, employees, contractors and agents (“indemnitees”) from any liability, claims,
suits, actions, arbitration proceedings, administrative proceedings, regulatory
proceedings, losses, expenses or costs of any kind, whether actual, alleged or
threatened, reasonable attorneys’ fees incurred by such indemnitee, court costs,
interest, defense costs including expert witness fees and any other costs or expenses of
any kind whatsoever without restriction or limitation incurred in relation to the Project or
the Master Site or the performance or non-performance of this Agreement by the
Agency (including without limitation the construction, maintenance and use of the Public
Improvements, the Visitors’ Center and the Gardens/Open Space), to the extent arising
out of or in connection with the (i) Default of the Agency under this Agreement, or (ii) the
negligent or intentional acts or omissions of Agency, its employees, contractors or
agents, provided such fault is determined by agreement between the Parties or the
findings of a court of competent jurisdiction.
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Section 7.2 Insurance Coverage Requirements:
7.2.1 The Developer shall obtain and maintain insurance upon
purchase of the Property, during construction and after completion of the Improvements
in conformance with the requirements set forth below. Developer acknowledges that
the insurance coverage and policy limits set forth in this Section 7.2 constitute the
minimum amount of coverage required hereunder. Any insurance proceeds available to
the Agency in excess of the limits and coverage required in this Agreement and which is
applicable to a given loss shall be available to the Agency. The Developer shall furnish
to the Agency evidence of coverages as required upon the Close of Escrow and the
commencement of construction work and shall continue to provide such evidence
annually as long as this Agreement is in effect.
7.2.1.1 Developer shall provide the following types and amounts
of insurance, prior to and during the construction of the Improvements and the
Term of Use, at no cost or expense to the Agency, with a reputable and
financially responsible insurance company reasonably acceptable to the Agency,
qualified to do business within the State of California and with a minimum Best’s
Insurance Guide rating of A:VII or higher:
(a) Commercial General Liability Insurance insuring against
claims and liability for bodily injury, death, or property damage arising from the
construction, use, occupancy, condition, or operation of the Property and/or the
Improvements, using Insurance Services Office “Commercial General Liability” policy
form CG 00 01 or the exact equivalent. Defense costs must be paid in addition to the
limits. There shall be no cross liability exclusion for claims or suits by one insured
against another. Limits shall be no less than Three Million Dollars ($3,000,000.00) per
occurrence for all covered losses and no less than Three Million Dollars ($3,000,000.00)
general aggregate;
(b) workers’ compensation insurance; and
(c) employer’s liability insurance.
7.2.1.2 All insurance coverage and limits provided by the
Developer and available or applicable to this Agreement are intended to apply to
the fullest extent of the policies. Nothing contained in this Agreement limits the
application of such insurance coverages. The insurance requirements set forth
in this section are intended to be separate and distinct from any other provision in
this Agreement and are intended to be interpreted as such.
7.2.1.3 Such insurance policies shall name the City and the
Agency and their respective council members, board members, officers,
directors, employees, consultants, independent contractors, attorneys and
representatives as additional insureds thereunder. Developer agrees to have its
insurer endorse the third party general liability coverage required hereunder to
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include as additional insureds “the City and the Redevelopment Agency, its
officials, board members, officers, employees, and agents” using standard ISO
endorsement CG 20 20 with an edition prior to 1992.
7.2.1.4 Developer agrees to provide evidence of the insurance
required herein, satisfactory to the City, consisting of: (a) certificate(s) of
insurance evidencing all of the coverages required, (b) an additional insured
endorsement to the Developer’s general liability policy using ISO Form CG 20 10
11 85, and (c) an endorsement pursuant to which the insurance company waives
the right of subrogation or consents to a waiver of right of recovery for loss or
damage occasioned by the negligence, act, omission or fault of the Agency or
Agency employees, agents, and representatives. Developer agrees upon
request by the Agency to provide complete, certified copies of any policies
required by this section within ten (10) days of such request. Any actual or
alleged failure on the part of the Agency or any other additional insured under
these requirements to obtain proof of insurance required under this Agreement in
no way waives any right or remedy of the Agency or any additional insured, in
this or in any other regard.
7.2.1.5 Unless otherwise approved by the Agency, insurance
provided pursuant to these requirements shall be by insurers authorized to do
business in California and with a minimum A.M. Best rating of A-VII. It is
acknowledged by the Parties that all insurance coverage required to be provided
by the Developer is intended to apply on a primary, non-contributing basis in
relation to any other insurance or self-insurance available to the Agency.
Policies shall be endorsed to contain such provisions.
7.2.1.6 Developer agrees to provide immediate notice to the
Agency of any claim or loss against Developer arising out of this Agreement.
Agency assumes no obligation or liability by such notice, but has the right (but
not the duty) to monitor the handling of claim or claims if they are likely to involve
the Agency.
7.2.1.7 The Agency reserves the right at any time during the
term of this Agreement to change the amounts and types of insurance required
hereunder by giving the Developer ninety (90) days advance written notice. All
coverage type and limits required are subject to approval, modification and
additional requirements by the Agency, as the need arises. Developer shall not
make any reductions in the scope of coverage (e.g., elimination of contractual
liability or reduction of the discovery period) that may affect Agency’s or City’s
protection without Agency’s or City’s prior written consent.
7.2.1.8 Without affecting any other rights or remedies, Agency
and Developer each hereby release and relieve the other, and waive their entire
right to recover damages (whether in contract or in tort) against the other, for loss
or damage to the Property or the improvements located thereon arising out of or
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incident to the perils customarily insured against in an “all risk” policy of fire and
extended coverage insurance. The effect of such release and waivers of the
right to recover damages shall not be limited by the amount of insurance carried
or required, or by any deductibles applicable thereto. Developer shall obtain,
from the insurance company or companies furnishing policies pursuant to this
Section 7.2, an appropriate endorsement pursuant to which the insurance
company waives the right of subrogation or consent to a waiver of right of
recovery for loss or damage occasioned by the negligence, act, omission or fault
of the Agency or Agency employees, agents, and representatives.
7.2.2 Before commencement of any construction work by Developer on
any portion of the Property, Developer shall obtain and maintain in force until
completion of such work (a) “all risk” builder’s insurance, including coverage for
vandalism and malicious mischief, in a form and amount equal to the construction
amount of the Improvements, (b) Broad Form Property Insurance, (c) workers’
compensation insurance covering all persons employed by Developer in connection
with work on the Improvements, or any portion thereof, and (d) earthquake coverage.
During the construction of Improvements on any portion of the Property by the
Developer, such builder’s risk insurance shall cover one hundred percent (100%) of the
value of all improvements in place and all material and equipment at the job site
furnished under contract, but shall exclude contractor’s, subcontractor’s, and
construction manager’s tools and equipment and property owned by the contractor’s
and subcontractor’s employees. The Developer shall also include Code Enhancement
to the property insurance provisions.
7.2.2.1 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 Property or otherwise
pursuant to this Agreement carries workers’ compensation insurance as required
by law.
7.2.2.2 With respect to each policy of insurance required above,
Developer and each of Developer’s general contractors shall furnish to the
Agency an endorsement to the insurance policy on the insurance carrier’s form
setting forth the general provisions of the insurance coverage. The required
certificate shall be furnished by Developer prior to commencement of
construction of any Improvements.
7.2.3 All such policies required by this Section 7.2 shall be
nonassessable and shall contain language to the effect that (a) the policies cannot be
canceled or materially changed except after thirty (30) days’ written notice by the insurer
to the Agency, and (b) the Agency shall not be liable for any premiums or assessments.
All such insurance shall have deductibility limits which shall be commercially
reasonable. Each insurance policy required to be carried by Developer hereunder shall
be primary insurance with respect to any insurance maintained by the Agency, which
shall be in excess of Developer’s insurance and shall not contribute with it.
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ARTICLE 8 GENERAL PROVISIONS.
Section 8.1 Notices. All notices and demands required or permitted to be given
hereunder shall be given in writing by first class U.S. certified or registered mail,
postage prepaid, and return receipt requested; by a nationally recognized overnight
courier service such as Federal Express; or by personal delivery. Notices shall be
considered given upon the earlier of (a) personal delivery, (b) the next business day
following deposit with a nationally recognized overnight courier service such as Federal
Express, or (c) three (3) business days following deposit or delivery shown on the return
receipt in the United States mail, postage prepaid, certified or registered, return receipt
requested. A copy of all notices delivered prior to the Close of Escrow shall be sent to
Escrow Holder. Notices shall be addressed as provided below for the respective Party;
provided that if any Party gives notice in writing of a change of name or address, notices
to such Party shall thereafter be given as demanded in that notice:
The Agency: Mr. Carlos L. Ortega
Executive Director
Palm Desert Redevelopment Agency
73-510 Fred Waring Drive
Palm Desert, California 92260
Telephone: (760) 346-0611
Facsimile: (760) 341-6372
with a copy to: Richards, Watson & Gershon
A Professional Corporation
355 South Grand Avenue, 40th Floor
Los Angeles, California 90071-3101
Attention: Jim G. Grayson, Esq.
Telephone: (213) 626-8484
Facsimile: (213) 626-0078
Developer: CV Food Service, Inc.
dba La Spiga
73-405 El Paseo
Palm Desert, CA 92260
Attention: Vincent Cultraro
Telephone: (760) 772-7163
Facsimile: (760) 360-5460
with a copy to: Vincent and Connie Cultraro
304 White Horse Trail
Palm Desert, CA 92211
Telephone: (760) 340-9318
Section 8.2 Construction. The Parties agree that each Party and its counsel
has reviewed and revised this Agreement and that any rule of construction to the effect
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that ambiguities are to be resolved against the drafting Party shall not apply in the
interpretation of this Agreement or any amendments or exhibits thereto. This
Agreement shall be construed as a whole according to its fair language and common
meaning to achieve the objectives and purposes of the Parties hereunder.
Section 8.3 Interpretation. In this Agreement the neuter gender includes the
feminine and masculine, and singular number includes the plural, and the words
“person” and “party” include corporation, partnership, firm, trust, or association wherever
the context so requires.
Section 8.4 Agency’s Consent. Whenever in this Agreement the approval or
consent of the Agency is required, the approval or consent of the Executive Director of
the Agency shall constitute the Agency’s approval and consent, unless this Agreement
specifically requires (or it is otherwise the normal protocol to obtain) the approval of the
Agency Board, or the Developer is advised that applicable law requires approval by the
Agency Board, or except as otherwise provided herein. In the event that the Agency
transfers ownership of all or any portion of the Master Site to the City, then whenever in
this Agreement the approval or consent of the Agency is required, it shall be deemed to
mean the approval or consent of the City, as applicable, and the approval or consent of
the City Manager shall constitute the City’s approval and consent, unless this
Agreement specifically requires (or it is otherwise the normal protocol to obtain) the
approval of the Agency Board, which shall be deemed to mean the approval of the City
Council, as applicable, or the Developer is advised that applicable law requires approval
by the City Council, or except as otherwise provided herein. Further, the Agency’s
and/or City’s consent or approval shall not be unreasonably delayed or withheld.
Section 8.5 Further Assurances. Each Party agrees to timely execute,
acknowledge and deliver such other documents and perform such other acts as may be
necessary and/or expedient to effectuate the purposes of this Agreement.
Section 8.6 Authority. The Developer is a duly organized and validly existing
corporation, in good standing under the laws of the State of California and is qualified to
do business and is in good standing in the State of California with full power and
authority to perform the obligations contemplated hereby. The Developer has the full
right, power and authority to own and develop the Property and the Improvements
thereon as contemplated in this Agreement.
Section 8.7 Enforceability. The Developer has full right, power and authority to
execute and deliver this Agreement and all instruments executed pursuant hereto, and
to perform the undertakings of the Developer contained in this Agreement and all
agreements executed pursuant hereto. This Agreement and all agreements executed
pursuant hereto constitute valid and binding obligations of the Developer which are
legally enforceable in accordance with their terms, subject to the application and effect
of all governmental requirements including, without limitation, the laws of bankruptcy,
creditor’s rights exceptions, and equity.
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Section 8.8 Time of the Essence. Time is of the essence of this Agreement.
Section 8.9 Warranty Against Payment of Consideration for Agreement.
Developer warrants that Developer has not paid or given, and will not pay or give, to
any third person, any money or other consideration for obtaining this Agreement, other
than normal costs of conducting business and costs of professional services such as
architects, engineers and attorneys.
Section 8.10 Attorneys’ Fees. If any Party brings an action to enforce the terms
hereof or declare its rights hereunder, or any other action is brought by any Party arising
from any dispute under this Agreement, the prevailing Party in any such action shall be
entitled to its reasonable attorneys’ fees to be paid by the losing Party as fixed by the
court. If either the Agency or the City, without fault, is made a Party to any litigation
instituted by or against Developer, then Developer shall defend the City and/or the
Agency against and save it harmless from all costs and expenses including reasonable
attorneys’ fees incurred in connection with such litigation. If Developer, without fault, is
made a Party to any litigation instituted by or against the Agency or the City, then the
Agency or the City shall defend Developer against and save it harmless from all costs
and expenses including reasonable attorneys’ fees incurred in connection with such
litigation.
Section 8.11 Entire Agreement, Waivers and Amendments. This Agreement
may be executed in duplicate originals. Escrow Holder may accept escrow instructions
in counterparts. This Agreement, together with all attachments and exhibits hereto, and
all agreements executed pursuant hereto, constitutes 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, whether oral or written, between the Parties with respect to the subject
matter hereof. No subsequent agreement, representation or promise made by either
Party hereto, or by or to any employee, officer, agent or representative of either Party,
shall be of any effect unless it is in writing and executed by the Party to be bound
thereby. No person is authorized to make, and by execution hereof Developer and the
Agency acknowledge that no person has made, any representation, warranty, guaranty
or promise except as set forth herein; and no agreement, statement, representation or
promise made by any such person which is not contained herein shall be valid or
binding on Developer or the Agency.
Section 8.12 Severability. Each and every provision of this Agreement is, and
shall be construed to be, a separate and independent covenant and agreement. If any
term or provision of this Agreement or the application thereof shall to any extent be held
to be invalid or unenforceable by a court of competent jurisdiction, the remainder of this
Agreement, or the application of such term or provision to circumstances other than
those to which it is held invalid or unenforceable, shall not be affected hereby, and each
term and provision of this Agreement shall be valid and shall be enforced to the fullest
extent permitted by law.
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Section 8.13 Headings. All section headings and subheadings are inserted for
convenience only and shall have no effect on the construction or interpretation of this
Agreement. The references in this Agreement to “Article” and “Section” shall refer to the
articles and sections, respectively, of this Agreement unless it is clear from the context
that another meaning is intended.
Section 8.14 No Third Party Beneficiaries other than the City. The City shall be
a named third party beneficiary of this Agreement. This Agreement is made and
entered into for the sole protection and benefit of the Parties, the City and their
respective successors and assigns. No other person shall have any right of action
based upon any provision of this Agreement.
Section 8.15 Governing Law; Jurisdiction; Service of Process. This Agreement
and the rights of the Parties shall be governed by California law. The Parties consent to
the exclusive jurisdiction of the California Superior Court for the County of Riverside. If
any legal action is commenced by Developer against the Agency, or by Agency against
Developer, service of process on the Agency shall be made by personal service upon
the Executive Director or Secretary of the Agency, or in such other manner as may be
provided by law. If any legal action is commenced by Agency against Developer,
service of process on Developer shall be made by personal service on Developer, or in
such other manner as may be provided by law. Developer agrees, for the benefit of the
Agency, that it shall designate an agent for service of process in the State of California
in the manner prescribed by law, and if it fails to do so, the Secretary of State of the
State of California is designated as agent for Developer, with full authority to receive
such service of process on its behalf, which designation and authorization shall survive
the Close of Escrow and the expiration or earlier termination of this Agreement and be
irrevocable.
Section 8.16 Survival. The provisions hereof shall not terminate but rather shall
survive any conveyance hereunder and the delivery of all consideration.
Section 8.17 Assignment. Except as otherwise expressly provided herein, the
Developer may not, and shall not, assign its obligations or benefits under this
Agreement without the prior written consent of the Agency, which consent may be given
or withheld by the Agency in the exercise of its sole and absolute discretion.
Section 8.18 Counterparts. This Agreement may be executed simultaneously in
one or more counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument. For purposes of this Agreement,
facsimile signatures shall be deemed to be original signatures, and shall be followed by
the immediate overnight delivery of original signature pages.
Section 8.19 Successors and Assigns. This Agreement shall be binding upon
and shall inure to the benefit of the Parties and their respective permitted assigns,
grantees and successors-in-interest. Without limiting the generality of the foregoing, in
the event that the Agency transfers all or any portion of the Master Site to the City, this
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Agreement shall be binding upon and shall inure to the benefit of the City, and any
Agency approval requirements shall be transferred to the City, as applicable, as more
specifically described in Section 8.4 hereof.
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IN WITNESS WHEREOF, the Parties hereto have entered into this Agreement
as of the day and year first above written.
“Developer”: “Agency”:
CV FOOD SERVICE, INC. PALM DESERT REDEVELOPMENT
a California corporation d/b/a La Spiga AGENCY, a public body, corporate and
politic
By: ___________________________ By:
President Chairperson
ATTEST:
By: ___________________________
Secretary
Rachelle D. Klassen, Secretary
APPROVED AS TO FORM:
Richards, Watson & Gershon,
a professional corporation
By: ________________________________
Agency Counsel
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LIST OF EXHIBITS
Exhibit A. – Legal Description and Site Plan of Property
Exhibit B. – Schedule of Performance
Exhibit C. – Scope of Development
Exhibit D. – Grant Deed
Exhibit E. – Easement Agreement
Exhibit F. – Legal Description of Master Site
Exhibit G. – Master Site Plan
Exhibit H. – Itemization of Maintenance Costs for Common Area
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EXHIBIT A.
LEGAL DESCRIPTION AND SITE PLAN OF PROPERTY
\[To Be Provided\]
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EXHIBIT B.
SCHEDULE OF PERFORMANCE
Approve DDA 3/9/06
Conceptual Approval by Architectural Review Commission 5/31/06
Final Approval by Architectural Review Commission 8/31/06
Building Pad Constructed by Agency 11/30/06
Permits Secured by Developer 10/31/06
Close of Escrow 11/30/06
Utilities Provided to Parcel Boundary by Agency 8/1/07
Parking Constructed by Agency 8/1/07
Certificate of Occupancy Secured by Developer 10/31/07
Developer Opens Restaurant for Business 11/30/07
Developer Obtains Certificate of Completion 1/1/08
Henderson Community Building Completed by Agency 5/1/07
Gardens/Open Space Completed by Agency 12/31/06
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EXHIBIT C.
SCOPE OF DEVELOPMENT
The Improvements shall consist of a fine dining restaurant and ancillary facilities
approximately 4,500 gross square feet in size, plus an exterior patio approximately
1,500 square feet in size, for a total of 6,000 gross square feet. The restaurant shall be
situated in an extensively landscaped setting with access to non-reserved and non-
designated public parking of approximately 60 spaces.
Developer covenants and agrees that the restaurant shall be open a minimum of five
days per week for dinner, eight and one half months per year. Developer may increase
schedule to serve a second meal (lunch) or for more than eight and one half months per
year at Developer’s discretion.
Developer shall provide or be responsible for all costs associated with:
• Grease trap sized to meet all applicable codes and grease interceptor of
adequate capacity. Agency shall cooperate with Developer in the location of the
sewer line so that the grease trap can be located in close proximity to the sewer
line and away from public view, but accessible for maintenance.
• Perimeter landscape and hardscape from building envelope to boundary of
Developer’s parcel.
• Payment for school fees, building plan check fees, and sewer connection fees
associated with the development of the Improvements.
• Utility lines and meters (including water, irrigation if required by CVWD, gas and
electric), backflow preventers, shutoff valves, and connection, testing, and
flushing from point of connection at parcel boundary to building, subject to final
approval and verification.
• one adequately sized sewer lateral with sanitation capacity stubbed out at parcel
boundary to building, and payment of the sanitation capacity fee.
• Installation of water meter(s) for domestic and irrigation water service.
• Gas meter and building shut off valve.
• All other costs associated with the development and construction of the
Improvements not otherwise expressly referenced as a Public Improvement as
described below.
Agency shall provide or be responsible for all costs associated with the following (the
“Public Improvements”):
• Parking lot allowing 60 parking spaces for Developer’s use and providing public
parking to accommodate the needs and uses of all other parcels within the
Master Site, site lighting, circulation, water features, landscape and hardscape
outside of Developer’s parcel (inclusive of all landscaping on public (exterior)
side of Developer’s garden wall) to accommodate the Project, the Master Site
Plan and the requirements of the Easement Agreement. In the event that the
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Developer requires more than 60 parking spaces, the Agency and Developer will
negotiate to provide up to 15 additional spaces at the Developer’s expense.
• Over-excavation, backfill and rough graded, compacted and certified building pad
necessary to meet structural requirements for Developer’s restaurant building.
• Park landscaping per City requirements with storm water retention facilities.
• 2" Domestic cold water line with water service base facility charge fee, stubbed
out at parcel boundary with 1.5" water meter.
• 1" Irrigation water line stubbed out at parcel boundary with 3/4" water meter.
• Detector check for fire sprinkler system 6" to post indicator valve within 30' of
building pad.
• 8" main sewer line in the road near the parcel, and one 6" lateral stubbed out
from this 8" main line to the parcel boundary.
• Fire hydrant(s) sized and located to comply with all applicable codes and
regulations, within 150 feet of all building walls.
• TBD mbtuh gas service, adequately sized by gas company, stubbed out
at parcel boundary.
• One 2" Telephone conduit with pull string stubbed out at parcel boundary, or one
4" telephone conduit if necessary due to conduit length.
• 1200 Amp, 120/208V 3-phase power stubbed out to parcel boundary
• TUMF and lizard fees associated with development of the parcel.
• Cable television conduit stubbed out at parcel boundary (if cable television
service is provided to the site by the franchise cable provider).
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EXHIBIT D.
GRANT DEED
RECORDING REQUESTED BY
AND WHEN RECORDED RETURN TO:
PALM DESERT REDEVELOPMENT AGENCY
73-510 Fred Waring Drive
Palm Desert, California 92260
Attn.: Ms. Lauri Aylaian
______________________________________________________________________
\[SPACE ABOVE FOR RECORDER’S USE ONLY\]
GRANT DEED
THE UNDERSIGNED GRANTOR DECLARES AS FOLLOWS:
This transfer is exempt from recording fees and transfer tax fees pursuant to
Government Code Section 6103 and 27383.
FOR A VALUABLE CONSIDERATION, receipt of which is hereby acknowledged,
PALM DESERT REDEVELOPMENT AGENCY, a public body, corporate and
politic (“Grantor”) hereby grants to CV FOOD SERVICE, INC., dba LA SPIGA, a
corporation organized and existing under the laws of the State of California (“Grantee”)
the following described real property, including all water, oil, mineral, gas, and
geothermal rights, and including the right to extract the same from said real property, if
and to the extent any such rights are held by the Grantor (collectively, the “Property”)
located in the City of Palm Desert, County of Riverside, State of California:
See Exhibit A attached hereto and incorporated herein by reference.
SUBJECT TO, all easements, covenants, conditions, restrictions, and rights of
way of record.
1. This Grant of the Property is subject to the Redevelopment Plan for
Project Area 1, as amended, of the Palm Desert Redevelopment Agency and pursuant
to a Disposition and Development Agreement entered into by and between Grantor and
Grantee dated as of , 200___ (the “Agreement”), the terms of
which are incorporated herein by reference. A copy of the Agreement is available for
public inspection at the offices of the Grantor, 73-510 Fred Waring Drive, Palm Desert,
California 92260. Capitalized terms not otherwise defined herein shall have the
meanings ascribed to them in the Agreement. The Property is conveyed further subject
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to all easements, rights of way, covenants, conditions, restrictions, reservations and all
other matters of record.
2. Grantee agrees that it shall use the Property only for operation of a fine
dining restaurant and ancillary uses and any other uses expressly permitted by the
Grantor until the date that is twenty (20) years after the date of recordation hereof, and
for no other purpose whatsoever, except as provided herein and subject to the terms
and conditions of Section 5.1.3 of the Agreement, including the Grantor’s right of first
negotiation to purchase the Property as described in said Section 5.1.3.
3. Subject to the provisions of the Agreement concerning Force Majeure
Delays, the Grantee shall begin physical construction of the Improvements on the
Property within three (3) months after the recordation hereof, and the Grantee plans to
complete the Improvements within fifteen (15) months after the date of recordation
hereof.
4. If the Grantee does not commence construction of the Improvements on
the Property within three (3) months after transfer of the Property to the Grantee, then,
at the option of the Grantor, the Property shall be subject to reversion to the Grantor,
and in such event the Property shall revert to the Grantor, free and clear of any and all
liens and encumbrances that may have been created by or with the approval of the
Grantee, other than utility easements and reasonable access easements, and the
Agreement shall terminate and be of no further force or effect, and the Grantor shall be
free to use or dispose of the Property. In such event, the Grantee shall execute a grant
deed to the Grantor conveying fee title to the Property, free and clear of all liens and
encumbrances created or permitted by the Grantee other than utility easements and
reasonable access easements. The Grantor agrees that any reversionary rights
hereunder shall be subordinate and inferior to any utility easements and reasonable
access easements.
5. The Grantee shall not convey, sell, encumber, hypothecate, lease or
otherwise transfer (collectively, “Transfer”) the Property or any portion thereof, or any
interest therein, without the prior written consent of the Grantor, which consent may or
may not be given in the sole and absolute discretion of the Grantor, except as provided
in Article 4 of the Agreement.
6. Notwithstanding the foregoing, however, any and all covenants and
conditions set forth in Sections 2 and 5 of this Grant Deed and Section 5.1 of the
Agreement shall terminate as to the Property in its entirety on the date that is twenty
(20) years after the date of recordation hereof, if not specified to terminate sooner.
7. By acceptance hereof, Grantee covenants and agrees for itself and its
successors and assigns, and for every successor in interest to the Property, or any
portion thereof, that there shall be no discrimination against or segregation of any
person, or group of persons, on account of sex, marital status, age, handicap, race,
color, religion, creed, national origin or ancestry in the sale, lease, sublease, transfer,
use, occupancy, tenure or enjoyment of the Property, and the Grantee shall not
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establish nor 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 Property or any portion thereof. The
Grantee further covenants and agrees for itself and its successors and assigns, and for
every successor in interest to the Property, or any portion thereof, that it shall refrain
from restricting the rental, sale or lease of the Property or any portion thereof on the
basis of sex, age, handicap, marital status, race, color, religion, creed, ancestry or
national origin of any person.
8. All deeds, leases or contracts entered into with respect to the Property
shall contain or be subject to substantially the following nondiscrimination or
nonsegregation clauses:
(a) In deeds: “The grantee herein covenants by and for itself, its
successors 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
account of race, color, creed, religion, sex, sexual orientation, marital status, ancestry,
national origin, age, physical handicap in the sale, lease, sublease, transfer, use,
occupancy, tenure or enjoyment of the land herein conveyed, 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 land herein conveyed.”
(b) In leases: “The lessee herein covenants by and for itself, its
successors and assigns, and all persons claiming under or through them, 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 account
of race, color, creed, religion, sex, sexual orientation, marital status, ancestry, national
origin, age, physical handicap in the leasing, subleasing, renting, transferring, use,
occupancy, tenure or enjoyment of the land herein , nor shall lessee itself, or any
person claiming under or through it establish or permit such practice or practices of
discrimination of segregation with reference to the selection, location, number, use or
occupancy of tenants, lessees, sublessees, subtenants or vendees in the land herein.”
(c) In contracts: “There shall be no discrimination against or segregation
of any person or group of persons on account of race, color, creed, religion, sex, sexual
orientation, marital status, ancestry, national origin, age, physical handicap in the sale,
lease, sublease, transfer, use, occupancy, tenure or enjoyment of the land, nor shall the
transferee 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 land.”
9. All covenants contained in this Grant Deed shall run with the land and
shall be binding for the benefit of Grantor and its successors and assigns and such
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covenants shall run in favor of the Grantor and for the entire period during which the
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, in the event of any breach of any such covenants, shall have the right to
exercise all of the rights and remedies provided for herein, under the Agreement or
otherwise available at law or in equity, and to maintain any actions at law or suits in
equity or other property proceedings to enforce the curing of such breach. The
covenants contained in this Grant Deed shall be for the benefit of and shall be
enforceable only by the Grantor and its successors and assigns.
10. All notices and demands required or permitted to be given hereunder shall
be given in writing by first class U.S. certified or registered mail, postage prepaid, and
return receipt requested; by a nationally recognized overnight courier service such as
Federal Express; or by personal delivery. Notices shall be considered given upon the
earlier of (a) personal delivery, (b) the next business day following deposit with a
nationally recognized overnight courier service such as Federal Express, or (c) three (3)
business days following deposit or delivery shown on the return receipt in the United
States mail, postage prepaid, certified or registered, return receipt requested. Notices
shall be addressed as provided below for the respective Party; provided that if any Party
gives notice in writing of a change of name or address, notices to such Party shall
thereafter be given as demanded in that notice:
Grantor: Mr. Carlos L. Ortega
Executive Director
Palm Desert Redevelopment Agency
73-510 Fred Waring Drive
Palm Desert, California 92260
Telephone: (760) 346-0611
Facsimile: (760) 341-6372
with a copy to: Richards, Watson & Gershon
A Professional Corporation
355 South Grand Avenue, 40th Floor
Los Angeles, California 90071-3101
Attention: William L. Strausz, Esq. and Jim G. Grayson, Esq.
Telephone: (213) 626-8484
Facsimile: (213) 626-0078
Developer: CV Food Service, Inc.
dba La Spiga
73-405 El Paseo
Palm Desert, CA 92260
Telephone: (760) 772-7163
Facsimile: (760) 360-5460
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with a copy to: Vincent and Connie Cultraro
304 White Horse Trail
Palm Desert, CA 92211
Telephone: (760) 340-9318
IN WITNESS WHEREOF, Grantor has executed this Grant Deed as of the date
set forth below.
Dated: , 200___
“Grantor”:
PALM DESERT REDEVELOPMENT
AGENCY, a public body, corporate and
politic
By:
Chairperson
ATTEST:
Rachelle D. Klassen, Secretary
“Grantee”:
CV FOOD SERVICE, INC.,
a California corporation d/b/a La Spiga
By:
President
By:
Secretary
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STATE OF )
) ss.
COUNTY OF )
On the _____ day of _______________, 2005, before me, ______________________,
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.
___________________________
Notary Public
SEAL:
STATE OF )
) ss.
COUNTY OF )
On the _____ day of _______________, 2005, before me, ______________________,
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.
___________________________
Notary Public
SEAL:
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STATE OF )
) ss.
COUNTY OF )
On the _____ day of _______________, 2005, before me, ______________________,
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.
___________________________
Notary Public
SEAL:
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EXHIBIT A
Legal Description of Property
THE PROPERTY REFERRED TO HEREIN IS SITUATED IN THE STATE OF
CALIFORNIA, COUNTY OF RIVERSIDE, CITY OF PALM DESERT, AND IS MORE
PARTICULARLY DESCRIBED AS FOLLOWS:
\[To Be Provided\]
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EXHIBIT E.
EASEMENT AGREEMENT
RECORDING REQUESTED BY
AND WHEN RECORDED RETURN TO:
Palm Desert Redevelopment Agency
73-510 Fred Waring Drive
Palm Desert, California 92260
Attn: Lauri Aylaian
\[Space Above For Recorder’s Use Only\]
Recording Fee: Exempt pursuant to California
Government Code Sections 6103 and 27383
EASEMENT AGREEMENT
This Easement Agreement is made and entered into as of the day of
_____________, 200__, by and among the PALM DESERT REDEVELOPMENT
AGENCY, a public body, corporate and politic (the “Agency”); the CITY OF PALM
DESERT, a municipal corporation (the “City”); and CV FOOD SERVICE, INC., dba LA
SPIGA, a corporation organized and existing under the laws of the State of California
(“La Spiga”). The Agency, the City and La Spiga agree as follows:
RECITALS
A. The Agency is the owner of that certain real property located in the City of
Palm Desert, County of Riverside, State of California, described in Attachment 1
attached hereto and incorporated herein by this reference (the “Agency Property”).
B. Agency and La Spiga are parties to that certain Disposition and
Development Agreement dated as of ____________________, 200__ (the “DDA”),
pursuant to which DDA La Spiga purchased from the Agency certain real property
located adjacent to the Agency Property (the “La Spiga Property”) and agreed to
construct certain improvements on the La Spiga Property, as set forth more specifically
therein.
C. Agency has created a public parking area on the Agency Property, which
area is depicted in Attachment 2 attached hereto and incorporated herein by this
reference (the “Easement Area”) (the Easement Area also being referred to herein as
the “Parking Lot Site”).
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D. Agency desires to convey a perpetual non-exclusive easement to La
Spiga for the purposes of vehicular and pedestrian ingress, egress and access to, and
parking on, the Parking Lot Site by the customers and employees of the business
operated by La Spiga on the La Spiga Property. La Spiga acknowledges and
understands that the Parking Lot Site shall also be used for these purposes by others,
including but not limited to visitors to the Eric Johnson Memorial Gardens and the Palm
Desert Visitor Information Center, the Henderson Community Building, Cuistot
Restaurant, and the public at large.
NOW THEREFORE, in consideration of the mutual covenants and easements
contained herein, the parties hereto agree as follows:
1. Definition of Terms.
“Agency” means the Palm Desert Redevelopment Agency and any assignee of,
or successor to, its rights, powers and responsibilities. The Agency is a public body,
corporate and politic, exercising governmental functions and powers, and organized and
existing under Chapter 2 of the California Community Redevelopment Law.
“Agency Property” means the real property described in Attachment 1 hereto.
“City” means the City of Palm Desert, County of Riverside, State of California.
“La Spiga” means those individuals or entities owning in fee or holding leasehold
interests in the La Spiga Property.
“Easement” means the Easement described in Section 2 of this Easement
Agreement.
“Easement Area” means those portions of the Agency Property subject to the
Easement, as described in Attachment 2.
“General Public” means the public generally, including but not limited to visitors
to and customers of the business operated by the La Spiga on the La Spiga Property.
“Parking Lot” means the public parking lot to be developed and operated on the
Parking Lot Site as specified herein.
“Parking Lot Site” means the Easement Area, as shown on Attachment 2,
attached hereto and incorporated by reference herein.
“Project Area” means the area of the City subject to the Redevelopment Plan.
The exact boundaries of the Project Area are specifically described in the
Redevelopment Plan.
“Redevelopment Plan” means the Redevelopment Plan for Project Area 1,
approved and adopted by the City Council of the City by Ordinance No. 80 on July 16,
1975.
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“Site Map” means the map attached hereto as Attachment 3 and incorporated
herein by this reference.
2. Easement. The Agency hereby establishes and grants to La Spiga a
perpetual, non-exclusive easement in, to, over and across the Easement Area for the
purpose of allowing the use of the Parking Lot by La Spiga, its employees and
customers, and the General Public for the purpose of the pedestrian and vehicular
ingress, egress, access and parking of passenger vehicles, as described in further
detail below (the “Easement”). The Easement shall be an appurtenant easement, and
shall burden the Easement Area for the benefit of the La Spiga Property and to provide
adequate parking for the public at large.
3. Reservation of Rights.
a. Subject to the Easement and the terms and provisions of the DDA,
the Agency retains the right to use, develop, and maintain the Agency Property,
provided that Agency’s use of the Agency Property shall not materially interfere with the
use of the easement rights granted herein to La Spiga.
b. The Agency hereby reserves the right to temporarily close all or any
portion of the Parking Lot as the Agency deems legally necessary and sufficient in order
to prevent the dedication thereof or an accrual of any rights in any particular person or
the public generally.
c. The Agency hereby reserves the right to institute reasonable, non-
discriminatory rules and regulations for the use of the Parking Lot Site and operation of
the Parking Lot in order to ensure the free flow of traffic throughout the Parking Lot.
The Agency shall not permit the Parking Lot Site to be used in a manner which would
interfere with the free flow of vehicular and pedestrian traffic throughout the Parking Lot.
4. Permitted Uses. The parties agree that the Parking Lot Site shall be used
only for the following purposes and for no other purposes whatsoever, unless all parties
hereto agree otherwise in writing:
a. Pedestrian and vehicular ingress, egress, access, and vehicular
parking by the General Public. Parking shall be permitted only in designated parking
stalls, and La Spiga shall be entitled to use no more than sixty (60) parking spaces. No
portion of the Parking Lot Site shall be used for the repair or storage of vehicles;
b. The temporary use (including erection of ladders, scaffolding and
building wall barricades) during periods of construction, remodeling or repair, for ingress
and egress for vehicles transporting materials and equipment and the use thereof by
construction equipment; provided, however, all such construction, remodeling or repair
of buildings and building appurtenances shall diligently be performed, and any such
ladders, scaffolding and barricades shall promptly be removed upon completion of such
work;
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c. The maintenance and repair (with replacement, if necessary) of
parking sites or stalls, sidewalks, ramps, driveways, lanes, curbs, gutters, traffic control
areas, signals, traffic islands, traffic and parking lighting facilities, planters, planting
boxes, edgers, sprinklers, valves, and landscape shrubbery;
d. The installation, maintenance and operation of public utility services
and appurtenances necessary for servicing the improvements on the Agency Property,
all of which shall be located below the surface of the finished paving or above ground
improvements.
5. Walls, Fences, and Barriers. The Agency shall not plant trees or other
foliage or erect any walls, fences, or other barriers on the Parking Lot Site which
prevent or materially impair the use or exercise of the Easement.
6. Maintenance.
a. Agency shall, at the collective cost and expense of La Spiga,
Agency and all other owners of the parcels within the Agency Property, on a pro rata
basis based upon the number of parking spaces required for each occupant of the
Agency Property divided by the total number of parking spaces in the Parking Lot Site,
through the payment of common area maintenance charges as required under and
pursuant to Section 5.1.2 of the DDA, at all times following and including the Agency’s
initial construction of the Parking Lot, perform, or cause to be performed, such
maintenance as needed to keep the Parking Lot clean and in good condition and repair.
Such maintenance shall include, but not be limited to the following:
(1) Maintaining the surfaces in a smooth and evenly covered
condition with the type of surfacing material originally installed, or such substitute as
shall in all respects be equal or superior to them in quality, use, and durability;
(2) Removing all standing water, papers, debris, filth, and
refuse, and thoroughly sweeping the paved areas, to the extent reasonably necessary
to keep the paved areas in a clean and orderly condition;
(3) Maintaining such appropriate parking area entrance, exit,
and directional signs, markers and lights in the manner they are currently being
maintained;
(4) Repainting striping, markers, directional signs, etc., as
necessary to maintain them in a first-class condition;
(5) Paying all electrical, water, and other utility charges or fees;
(6) Maintaining and repairing all storm drains and sewers, and
all electrical, water, and other utility lines or systems which are used in whole or in part
to provide services to the Parking Lot or which are necessary for the operation of the
Parking Lot;
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(7) Operating, keeping in repair, and replacing when necessary,
such parking lot lighting facilities as are reasonably required;
(8) Obtaining and maintaining in full force and effect commercial
general liability insurance and other insurance in accordance with the provisions of
Section 7 of this Easement Agreement; and
(9) Maintaining all landscaping in a healthy, first class condition,
including weeding, trimming, gardening, replacing shrubs and other landscaping, and
watering, including repairing automatic sprinkler systems or water lines.
La Spiga shall be responsible for a pro-rata share of the cost of such
maintenance expenses in accordance with the DDA.
7. Insurance. The Agency hereby represents and warrants that it is self
insured via its participation in a California joint powers insurance authority in the
aggregate limit of Fifty Million Dollars ($50,000,000.00). La Spiga acknowledges and
agrees that, as of the date of this Easement Agreement, La Spiga has received from the
Agency a certificate of insurance evidencing such coverage. La Spiga, Agency and all
other owners of the parcels within the Agency Property, on a pro rata basis based upon
the number of parking spaces required for each such respective party divided by the
total number of parking spaces in the Parking Lot Site (i.e., on the same basis that
Common Area Expenses are to be allocated pursuant to the DDA), shall collectively pay
the sum of Five Hundred Dollars ($500.00) on an annual basis in order to cover the
administrative overhead and management costs of insuring the Parking Lot Site. In the
event that the Agency is no longer self insured, or the amount of such self-insurance
falls below Three Million Dollars ($3,000,000.00), the Agency shall, within thirty (30)
days, purchase and maintain as a Common Area Expense, a policy of commercial
general liability insurance with coverage in an amount of at least Three Million Dollars
($3,000,000.00).
8. Indemnification.
a. Except as provided herein to the contrary, and except to the extent
of the negligent or intentional acts or omissions of Agency or its employees, contractors
or agents, or the breach of or default under this Easement Agreement or the DDA by
the Agency, La Spiga shall indemnify, defend, protect, and hold harmless the Agency
from and against any and all claims, losses, proceedings, damages, causes of action,
liability, costs and expenses, (including attorneys’ fees) arising from or in connection
with, or caused by (i) any negligent or intentional act or omission of La Spiga or any
lessee, sublessee, licensee, concessionaire, contractor, licensee, agent, servant or
employee thereof (collectively, “Users”), wheresoever the same may occur, including,
without limitation, in connection with any use of the Parking Lot, or any accident, injury,
death or damage to any person or property occurring in, on or about the Parking Lot, or
any part thereof, or from the conduct of La Spiga’s or its Users’ businesses or from any
activity, work or thing done, permitted or suffered by La Spiga or its Users in or about
the Parking Lot Site or elsewhere; and/or (ii) any breach or default in the performance of
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any obligations on La Spiga’s part to be performed under the terms of this Easement
Agreement or the DDA, or arising from any negligence of La Spiga, or any such claim or
any action or proceeding brought thereon; and in case any action or proceeding be
brought against the Agency by reason of any such claim, La Spiga, upon notice from
the Agency, shall defend the same at La Spiga’s expense by counsel reasonably
satisfactory to the Agency. La Spiga, as a material part of the consideration to the
Agency, hereby assumes all risk, vis-à-vis the Agency, of damage to property or injury
to persons in, upon or about the Parking Lot Site arising from any cause other than the
Agency’s negligence or intentional acts or breach of or default under this Easement
Agreement or the DDA, and La Spiga hereby waives all claims in respect thereof
against the Agency. These provisions are in addition to, and not in lieu of, the
insurance required to be provided by Section 7 hereof, and the insurance requirements
of Section 7 shall not serve to limit La Spiga’s liability under this Section 8 in any
manner.
Nothing contained herein shall limit La Spiga’s rights of contribution from any other third
party on account of damages arising from such third party’s negligence or breach of any
other agreement between such third party and the Agency.
b. Exemption of the Agency and the City from Liability. Except to the
extent of the negligent or intentional acts or omissions of Agency or its employees,
contractors or agents, or the breach of or default under this Easement Agreement or the
DDA by the Agency, La Spiga hereby assumes all risks and liabilities of a landowner in
the possession, use or operation of the Parking Lot Site, vis-à-vis the Agency. Except
as provided herein or in the DDA to the contrary, and except to the extent of the
negligent or intentional acts or omissions of Agency or its employees, contractors or
agents, or the breach of or default under this Easement Agreement or the DDA by the
Agency, La Spiga, on behalf of itself and its lessees, sublessees, licensees,
concessionaires or contractors, hereby agrees that the Agency and the City shall not be
liable for injury to La Spiga’s business or its lessees’, sublessees’, licensees’,
concessionaires’ or contractors’ businesses or any loss of income therefrom or for
damage to the goods, wares, merchandise or other property of La Spiga or its Users, or
any other person in or about the Parking Lot Site, including any liability arising from the
physical condition of the Parking Lot Site or the presence of any hazardous or toxic
materials or substances on the Parking Lot Site, nor shall the Agency or the City be
liable for injury to the person of La Spiga, or its Users, whether such damage or injury is
caused by or results from hazardous or toxic materials or substances, fire, steam,
electricity, gas, water, or rain, or from the breakage, leakage, obstruction or other
defects of pipes, sprinklers, wires, appliances, plumbing, air conditioning or lighting
fixtures, or from any other cause, whether the said damage or injury results from
conditions arising upon the Parking Lot Site or from other sources or places and
regardless of whether the cause of such damage or injury or the means of repairing the
same is inaccessible to La Spiga. Nothing contained herein shall be construed as
excusing the Agency or the City, however, from liability for the Agency’s or the City’s
negligence or intentional misconduct or breach of or default under this Easement
Agreement or the DDA.
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c. Agency Liability. The Agency hereby agrees to indemnify, defend,
protect, and hold harmless La Spiga from and against any and all claims, losses,
proceedings, damages, causes of action, liability, costs and expenses, (including
attorneys’ fees) arising from or in connection with the Agency’s construction of any
improvements on the Parking Lot, and any breach or default in the performance of any
obligations on the Agency’s part to be performed under the terms of this Easement
Agreement, or arising from any negligence of the Agency, or any such claim or any
action or proceeding brought thereon; and in case any action or proceeding be brought
against La Spiga by reason of any such claim, the Agency shall, upon notice from La
Spiga, defend the same at the Agency’s expense by counsel reasonably satisfactory to
La Spiga.
9. Non-Discrimination Provision. The Agency covenants and agrees for
itself, its successors, assigns and every successor in interest to the portion of the
Agency Property encumbered by the Easement, or any part thereof, that there shall be
no discrimination against or segregation of any person, or group of persons, on account
of race, color, religion, creed, national origin, ancestry, physical handicap, medical
condition, age, marital status, or sex in the sale, lease, sublease, transfer, use,
occupancy, tenure or enjoyment of the Parking Lot Site, nor shall the Agency 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 Parking Lot Site.
10. Enforcement.
a. In the event of La Spiga’s default or breach in the performance of
any of the obligations or agreements herein, and after written notice giving La Spiga ten
(10) days in which to cure such default, the Agency or the City, or both of them, shall
have the right, but not the obligation, to cure such default for the account and at the
expense of La Spiga, and the Agency or the City, or both of them, shall have the right to
recover from La Spiga all damages, and all costs and other sums expended in
connection therewith, including reasonable attorneys’ fees, plus interest thereon at the
maximum legal rate permitted to be charged by non-exempt lenders under the laws of
the State of California, and the Agency or the City, as the case may be, may impose a
lien upon the La Spiga Property (including the improvements thereon). Such lien may
be imposed by (i) serving written notice upon La Spiga, which notice shall contain a
representation of non-compliance with the provisions of this Section, an explanation as
to the nature of the particular obligation, and a description of the La Spiga Property, and
(ii) by duly recording a copy of such notice in the Official Records of Riverside County,
California. The priority of such lien shall be determined as of the date of filing the same
of record; provided, however, any such lien shall nevertheless be subject and
subordinate to the lien of any mortgage or deed of trust now or hereafter covering any
portion of the La Spiga Property. Such lien shall continue until fully discharged, but in
no event longer than five (5) years from the date of recordation, and may be foreclosed
by a judgment at law or by means of a power of sale in accordance with the laws of the
State of California pertaining to foreclosure of mortgages with a power of sale. Such
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lien shall secure not only the amount stated in the aforesaid notice, but also the
reasonable costs and expenses of enforcing the same, including interest at the rate
provided herein and reasonable attorneys’ fees. In addition, in the event of La Spiga’s
default, the Agency or the City, or both of them, may pursue any other remedies or
proceedings available to it at law or in equity. The Agency or the City may, in any such
proceeding, recover damages from or on account of such violation; secure by way of
specific performance or otherwise the performance of such covenant, condition,
easement or restriction; or obtain any other remedy provided for at law or in equity.
b. In the event of Agency’s default or breach in the performance of
any of the obligations or agreements herein, La Spiga shall have the remedy of specific
performance of this Easement Agreement, in addition to all other remedies available at
law or in equity, and La Spiga shall have the right to recover from the Agency all
damages, and all costs and other sums expended in connection therewith, including
reasonable attorneys’ fees, plus interest thereon at the maximum legal rate permitted to
be charged by non-exempt lenders under the laws of the State of California.
11. Miscellaneous.
a. Termination of Liability. Whenever a bona fide transfer of any
interest in any of the Agency Property takes place, the transferor shall not be liable for
breach of a covenant occurring thereafter with respect to the transferred interest.
b. Notices. Unless otherwise specifically provided in this Easement
Agreement, all notices, demands or other communications required or permitted to be
given to the Agency and the City or La Spiga shall be given in writing by first class U.S.
certified or registered mail, postage prepaid, and return receipt requested; by a
nationally recognized overnight courier service such as Federal Express; or by personal
delivery. Notices shall be considered given upon the earlier of (a) personal delivery, (b)
the next business day following deposit with a nationally recognized overnight courier
service such as Federal Express, or (c) three (3) business days following deposit or
delivery shown on the return receipt in the United States mail, postage prepaid, certified
or registered, return receipt requested. Notices shall be addressed as provided below
for the respective Party; provided that if any Party gives notice in writing of a change of
name or address, notices to such Party shall thereafter be given as demanded in that
notice:
To Agency or City: Mr. Carlos L. Ortega
Executive Director
Palm Desert Redevelopment Agency
73-510 Fred Waring Drive
Palm Desert, California 92260
Telephone: (760) 346-0611
Facsimile: (760) 341-6372
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with a copy to: Richards, Watson & Gershon
A Professional Corporation
355 South Grand Avenue, 40th Floor
Los Angeles, California 90071-3101
Attention: William L. Strausz, Esq. and Jim G. Grayson, Esq.
Telephone: (213) 626-8484
Facsimile: (213) 626-0078
To La Spiga: CV Food Service, Inc.
dba La Spiga
73-405 El Paseo
Palm Desert, CA 92260
Telephone: (760) 772-7163
Facsimile: (760) 360-5460
with a copy to: Vincent and Connie Cultraro
304 White Horse Trail
Palm Desert, CA 92211
Telephone: (760) 340-9318
c. Gender. The use herein of the neuter gender shall include the
masculine and the feminine, and the singular number shall include the plural, whenever
the context so requires.
d. No Third-Party Beneficiaries. No person shall have any
enforceable rights under this Easement Agreement other than the parties hereto and
their successors and assigns, notwithstanding any provisions hereof which contemplate
that other persons may exercise certain privileges, or any references herein to the
General Public.
e. No Waiver. No waiver by the Agency or the City of any default of
La Spiga shall be implied from any omission by the Agency or the City to take any
action in respect of such default. No express waiver of any default shall affect any
default or cover any period of time other than the default and period of time specified in
such express waiver. One or more waivers of any default in the performance of any
term, provision or covenant contained in this Easement Agreement shall not be deemed
a waiver of any subsequent default in the performance of the same term, provision or
covenant or any other term, provision or covenant contained in this Easement
Agreement. The consent or approval by the Agency or the City to or of any act or
request of La Spiga requiring consent or approval shall not be deemed to waive or
render unnecessary the consent or approval to or of any subsequent similar acts or
requests. The rights and remedies given to the Agency or the City by this Easement
Agreement are cumulative, and none of such rights and remedies shall be exclusive of
any of the others, or of any other right or remedy at law or in equity which the Agency or
the City might otherwise have by virtue of a default under this Easement Agreement.
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f. Estoppel Certificates. La Spiga covenants that upon receipt of
written request from the Agency or the City, La Spiga shall, within fifteen (15) days after
receipt of such request, give to the Agency or the City or other person specified by the
Agency or the City, an estoppel certificate stating: (i) whether La Spiga knows of any
default by the Agency under this Easement Agreement, and if there are known defaults,
specifying the nature thereof; (ii) whether to La Spiga’s knowledge any provision of this
Easement Agreement has been assigned, modified or amended in any way (and if it
has, then stating the nature thereof); (iii) that to La Spiga’s knowledge, this Easement
Agreement, as of the date of the estoppel certificate, is in full force and effect; and (d)
any other information reasonably required by the Agency or the City.
g. Amendment. This Easement Agreement may be cancelled,
changed, modified in whole or in part only by the written and recorded agreement
executed by all of the parties hereto.
h. Negation of Partnership. None of the terms or provisions hereof
shall be deemed to create a partnership between or among the parties hereto, nor shall
it cause them to be considered joint venturers, or members of any joint enterprise, in the
operation of the Parking Lot or otherwise.
i. Entire Agreement. This instrument contains the entire agreement
of the parties hereto as to the rights herein granted and the obligations herein assumed,
and no oral representation shall be of any force or effect. No modification of this
Easement Agreement shall be of any force or effect until signed by the party to be
charged.
j. Severability. Invalidation of any covenant, condition, or restriction
or any other provision contained herein or the application thereof to any person or entity
by judgment or court order shall in no way affect any of the other covenants, conditions,
restrictions, or provisions hereof, or the application thereof to any other person or entity,
and the same shall remain in full force and effect.
k. Headings. The caption headings of the various sections and
paragraphs of this Easement Agreement are for convenience and identification only and
shall not be deemed to limit, expand or define the contents of the respective sections or
paragraphs.
l. Attorneys’ Fees. In the event any party hereto shall commence any
action against any other party relating to this Easement Agreement or for the breach of
any obligation contained herein, the prevailing party shall be entitled to recover from the
losing party reasonable attorneys’ fees, expenses, and court costs.
m. Time of Essence. Time is of the essence of each provision of this
Easement Agreement in which time is an element.
n. California Law. This Easement Agreement shall be construed in
accordance with the laws of the state of California.
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o. No Partnership. Nothing in this Easement Agreement shall deem
La Spiga and Agency as partners or joint venturers.
p. Agreement for Exclusive Benefit of Parties. The provisions of this
Easement Agreement are for the exclusive benefit of the parties hereto and not for the
benefit of any other person, nor shall this Easement Agreement be deemed to have
conferred any rights, express or implied, upon any third person.
q. Successors and Assigns. This Easement Agreement shall be
binding upon and inure to the benefit of the parties hereto and the respective
successors and assigns and grantees of such parties. La Spiga hereby acknowledges
that it is the intent of the Agency to convey the Agency Property to the City.
r. Written and Reasonable Consent Required. Except as otherwise
may be provided in this Easement Agreement, whenever a party is requested to
consent to or approve of any matter with respect to which its consent or approval is
required by this Easement Agreement, such consent or approval, if given, shall be given
in writing. Wherever a party is required to obtain the consent or approval of another
party, such consent or approval shall not be unreasonably withheld and shall be given in
writing within a reasonable period of time; provided however, that this provision shall not
apply where this Easement Agreement specifically states that such consent or approval
may be unreasonably withheld or is subject to the sole discretion of any party or words
of similar import.
s. Covenants Run With the Land. It is intended that the covenants,
easements, agreements, promises and duties of each person and owner as set forth in
this Easement Agreement shall be construed as covenants and not as conditions and
that all such covenants shall run with the land and be enforceable against both the
covenantor and the land or constitute equitable servitudes as between the Agency
Property as the servient tenement, and the La Spiga Property as the dominant
tenement.
t. Counterparts. This Easement Agreement may be signed in several
counterparts, each of which shall be deemed an original, and all such counterparts shall
constitute one and the same instrument.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the day and year first set forth above.
“La Spiga”: “Agency”:
CV FOOD SERVICE, INC., PALM DESERT REDEVELOPMENT
AGENCY, a public body, corporate and
a California corporation d/b/a La Spiga
politic
By: ___________________________
President By:
Chairperson
ATTEST:
By: ___________________________
Secretary
Secretary
“City”:
CITY OF PALM DESERT, a municipal
corporation
By:
Mayor
ATTEST:
City Clerk
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EXHIBIT A
LEGAL DESCRIPTION OF AGENCY PROPERTY
\[to come\]
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EXHIBIT B
LEGAL DESCRIPTION OF EASEMENT AREA
\[to come\]
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EXHIBIT C
SITE MAP
\[to come\]
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STATE OF CALIFORNIA )
)
COUNTY OF ____________________ )
On __________ ___, 200__, before me, _______________________________,
a Notary Public in and for the State of California, 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.
_____________________________________
Notary Public in and for the State of California
(SEAL)
STATE OF CALIFORNIA )
)
COUNTY OF ____________________ )
On __________ ___, 200__, before me, _______________________________,
a Notary Public in and for the State of California, 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.
_____________________________________
Notary Public in and for the State of California
(SEAL)
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STATE OF CALIFORNIA )
)
COUNTY OF ____________________ )
On __________ ___, 200__, before me, _______________________________,
a Notary Public in and for the State of California, 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.
_____________________________________
Notary Public in and for the State of California
(SEAL)
STATE OF CALIFORNIA )
)
COUNTY OF ____________________ )
On __________ ___, 200__, before me, _______________________________,
a Notary Public in and for the State of California, 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.
_____________________________________
Notary Public in and for the State of California
(SEAL)
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STATE OF CALIFORNIA )
)
COUNTY OF ____________________ )
On __________ ___, 200__, before me, _______________________________,
a Notary Public in and for the State of California, 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.
_____________________________________
Notary Public in and for the State of California
(SEAL)
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EXHIBIT F.
LEGAL DESCRIPTION OF MASTER SITE
PARCEL 1 OF PARCEL MAP NO. 25875, IN THE CITY OF PALM DESERT, COUNTY
OF RIVERSIDE, STATE OF CALIFORNIA, AS SHOWN BY MAP ON FILE IN BOOK
163, PAGES 34 AND 35 OF PARCEL MAPS, IN THE OFFICE OF THE COUNTY
RECORDER OF SAID COUNTY.
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EXHIBIT G.
MASTER SITE PLAN
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EXHIBIT H.
ITEMIZATION OF MAINTENANCE COSTS FOR COMMON AREA
ENTRADA DEL PASEO DEVELOPMENT
PALM DESERT REDEVELOPMENT AGENCY
The following costs comprise the Common Area Maintenance Costs for the Entrada Del
Paseo Development relative to the proposed 4,500 SF restaurant bordered on two sides
by Painter’s Path and the Palm Valley Storm Channel:
1. Routine and special landscape maintenance costs for landscaping in: the parking
areas of Parcels 9, 10, 11, and such new parcel(s) as may be created for new
parking stalls constructed in association with Developer’s restaurant; the
landscape buffer of Parcels 5, 6, and 7; and the circulation Parcel 8, all as shown
on Tract Map 30226, as may be amended for subject development.
2. Electrical power and periodic relamping for exterior lighting in the same parcels
described in Item 1 above.
3. Irrigation water for landscaping in the same parcels described in Item 1 above.
4. Routine sweeping and as-needed repair of the paving, curbs, and hardscape in
the parking areas of Parcels 9, 10, 11, and such other parcel(s) as may be
created for new parking stalls constructed in association with Developer’s
restaurant, circulation Parcel 8 and additional circulation parcel(s) as may be
created for entry drive to Developer’s restaurant, all as shown on Tract Map
30226, as may be amended for the subject development.
5. Periodic resurfacing of driving and parking areas and restriping of parking stalls
in Parcels 8, 9, 10, 11, and such other parcel(s) as may be created for parking or
circulation in the development of subject project, all as described on Tract Map
30226, as may be amended for subject project.
For the common area maintenance associated with Items 1 through 5, above,
reimbursement for maintenance costs will be made on the basis of the number of
parking stalls attributed to the subject restaurant (60) divided by the total number of
parking stalls in Parcels 9, 10, 11, and such other parcel(s) as may be created for the
parking and circulation associated with this project.
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