Desert Cities Dev/Negotiation 07EXCLUSIVE NEGOTIATION AGREEMENT
Desert Cities Development, Inc.
THIS EXCLUSIVE NEGOTIATION AGREEMENT ("Agreement') is entered into this
Ile day of March, 2007, by and between the LA QUINTA REDEVELOPMENT AGENCY,
a public body, corporate and politic ("Agency"), and DESERT CITIES DEVELOPMENT, INC.,
a California corporation ("Developer"), on the terms and provisions set forth below.
RECITALS
WHEREAS, in May 16, 1989, the City Council of the City of La Quinta approved and
adopted the Redevelopment Plan for Project No. 2 by Ordinance No. 189 ("Redevelopment
Plan") establishing the La Quinta Redevelopment Project Area No. 2 ("Project Area"); and
WHEREAS, Agency owns approximately 19.9 acres located on Highway I I I in the City
of La Quinta, County of Riverside, State of California, as further depicted on Exhibit A attached
hereto (the "19.9 Acre Property"); and
WHEREAS the parties contemplate that the Agency will, separate and apart from the
obligations or rights imposed by this Agreement and at its sole cost and expense, work to resolve
secondary access issues relating to the adjacent Costco site and cause a lot line adjustment
(subject to any requirements under California law including, without limitation, provisions of the
California Subdivision Map Act [Govt. Code § 66410 et seq.] and the California Environmental
Quality Act [Pub. Res. Code § 21000 et seq.] ("CEQA")), the result of which will be that the
19.9 Acre Property will be divided into two parcels: (1) a parcel consisting of approximately 8.98
acres (the "Remainder Parcel") and (2) a parcel consisting of approximately 10.99 acres (the
"Site"); and
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WHEREAS, Developer is interested in leasing the Site from Agency and developing
thereon an approximately 220-unit, multi -family affordable housing development with dwelling
units rented, at affordable housing costs, to very low and low income family households, it being
contemplated that approximately 50% of the units will be in the very low income affordability
range and approximately 50% of the units will be in the low income affordability range
("Project'); and
WHEREAS, the Agency and Developer will need to cooperate in preparing the Master
Site Plan (defined below) as part of the process envisioned by this Agreement; provided,
however, that this Agreement shall not obligate the Agency to grant any rights to Developer with
respect to the Remainder Parcel and the development of the Remainder Parcel is not a part of this
Agreement; and
WHEREAS, Agency and Developer desire to enter into this Agreement to initiate
exclusive negotiations for up to one hundred twenty (120) days ("Negotiation Period") for the
purposes of (i) working with the Agency to prepare a Master Site Plan (defined below) for the
19.9 Acre Property, (ii) undertaking due diligence activities regarding the Project; (iii) facilitating
a preliminary design of the Project; (iv) establishing preliminary Project development
responsibilities (including a preliminary Project development schedule and financial parameters);
(v) setting the Site real property lease ("Lease") terms and attempting to negotiate and finalize
the Lease; and (vi) attempting to negotiate and finalize a disposition and development agreement
("DDA") and other documents relating to the development of affordable housing on the Site.
NOW, THEREFORE, in consideration of the recitals and mutual covenants and
conditions contained herein, the parties hereto agree as follows:
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1. SITE
The Site constitutes the real property that is the subject of this Agreement. The
Remainder Parcel is not part of this Agreement. The Site is approximately 10.99 acres in size
and is located on Highway 111, between Dune Palms Road and Jefferson Avenue, in Project
Area No. 2. The Site is depicted on Exhibit B, which is attached hereto and incorporated herein
by this reference.
11. NEGOTIATION PERIOD
A. Negotiation Period
The negotiation period shall commence upon the date Agency executes this Agreement,
which commencement date shall be inserted into the preamble to this Agreement (the
"Commencement Date"), and shall end on the date that is one hundred twenty (120) days
following the Commencement Date (the "End Date"), unless earlier terminated or extended
pursuant to the terms of this Agreement ("Negotiation Period"). This Agreement shall
automatically terminate as of the End Date unless extended pursuant to the terms of the
Agreement.
B. Due Diligence/Site Plan Development
During the first sixty (60) days of the Negotiation Period (the "First Due Diligence
Period"), the parties agree to negotiate in good faith, to conduct due diligence activities and to
formulate the schematic design plan for development of the Project (the "Site Plan") as well as a
master site plan for the entire 19.9 Acre Property (the "Master Site Plan"). The Site Plan shall
include and delineate the following conceptual elements on a preliminary design basis:
1. The type, scope and size of the Project;
2. The type, number and size of the dwelling units;
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3. The building configuration(s), ingress/egress points, on- and off -site
parking areas, open space areas, and building exterior elevations;
4. The Project's relationships with the surrounding uses, including its
relationship with the Master Site Plan;
5. Required on- and off -site infrastructure improvements;
6. Project infrastructure, and state and local regulatory requirement costs;
7. The number of units that will be affordable to very low and low income
family households, it being agreed that the Project shall include
approximately 220 units, of which approximately 50% will be affordable
to low income households and approximately 50% will be affordable to
very low income households;
8. Funding responsibilities and sources for development of the Project;
9. The parties/entities responsible for Project development activities; and
10. A Project development schedule.
Developer shall promptly select an architect to work on the design of the Project. The
Agency shall participate in the selection and the architect's selection shall be subject to the
Agency's prior approval which shall not be unreasonably withheld, delayed or conditioned.
During the First Due Diligence Period, Agency and Developer, as applicable, shall
conduct their respective due diligence activities, including but not limited to the following:
1. Developer shall evaluate the Site and surrounding areas and prepare site
plan options, a preliminary development program, and building exterior
elevations for Agency consideration;
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2. Developer shall prepare and t mit a tentative Project development
schedule for Agency consideration
3. Developer shall prepare and submit Project development and operations
pro formas for the preferred Site Plan that identify estimated indirect and
direct Project development costs, anticipated affordable housing rent
levels, estimated Project revenue based upon the anticipated affordable
housing rent levels, and estimated Project operating expenses including the
anticipated Site lease payment cost;
4. Developer shall prepare and submit Project development financing options
and provide projected sources of equity and financing for the development
and operation of the Project;
5. Developer shall conduct a workshop that is advertised and open to the
public to solicit community and Agency staff input on Project design
configurations and parameters, and to review Developer generated design
concepts;
6. Agency shall provide Developer will all reports, plans and information
Agency or the City of La Quinta ("City") may have for the 19.9 Acre
Property, however, neither Agency nor City will guarantee the accuracy of
said documents;
7. Developer shall review preliminary title report information for the Site;
8. Developer shall conduct other due diligence activities as necessary to
determine whether or not the Site can accommodate the Project. In
conjunction therewith, Developer and its consultants and agents shall have
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the right to enter upon the Site to conduct tests, studies, and investigations
pursuant to an Early Entry Agreement, the form of which is attached
hereto and incorporated herein as Exhibit C.
If, at the end of the First Due Diligence Period, Agency's Board of [Directors] ("Agency
Board") has not accepted the Site Plan and Developer's financing proposal for the Project, this
Agreement shall automatically terminate without notice, unless the time for Developer's
performance is extended in writing by Agency Executive Director, in his or her sole and absolute
discretion (and with Developer's written agreement to the extension), pursuant to Section VIHQ
of this Agreement, the parties hereto mutually agree, each in their sole and absolute discretion, to
extend the First Due Diligence Period and the Negotiation Period.
C. DDA/Environmental Review/Entitlements
If the Site Plan and Developer's proposed financing are accepted by the Agency Board
prior to the close of the First Due Diligence Period, then Agency agrees to negotiate exclusively
with Developer for the remaining sixty (60) days of the Negotiation Period (the "Second Due
Diligence Period") to negotiate and attempt to finalize the DDA, the Lease and any related
affordable housing agreements and to prepare any required environmental documentation. The
parties understand that this ENA may need to be subsequently amended to extend the term in
order to accommodate the environmental assessments for project entitlements.
If, at the close of the Negotiation Period, Developer has not executed and submitted a
DDA to Agency, this Agreement shall automatically terminate without notice, unless the time for
Developer's performance is extended in writing by Agency Executive Director, in his or her sole
and absolute discretion (and with Developer's written agreement to the extension), pursuant to
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Section VIHQ of this Agreement, the parties mutually agree, each in their sole and absolute
discretion, to extend the Second Due Diligence Period and the Negotiation Period.
D. Submittal of DDA to Agency Board and City Council
Upon submittal of the executed DDA by the Developer to Agency, the Negotiation Period
shall be extended for an additional sixty (60) days ("Third Due Diligence Period") to enable
Agency and the City to notice and conduct a public hearing pursuant to Section 33433 of the
California Health and Safety Code on the DDA.
E. Exclusivity of Negotiations
Agency agrees that during the Negotiation Period, Agency shall not negotiate or enter into
an agreement with any other person or entity regarding development of the Site. During the
Negotiation Period, Developer agrees that it will commit the financial and time resources
required to conduct and complete the activities outlined in this Agreement.
The obligation to negotiate in good faith requires the respective parties to communicate
with each other regarding issues for which agreement has not been reached, and in such
communication to follow reasonable negotiation procedures, including meetings, telephone
conversations, and correspondence. The parties understand that final accord on all issues may
not be reached. It is also understood that (i) neither party is under any obligation to reach
agreement on the DDA or Lease, and (ii) Agency and Developer each reserves the right to
approve or reject a DDA or Lease, the Project, or any disposition of the Site, as set forth in this
Agreement.
F. Agency and Developer Obligations
During the Negotiation Period Agency and Developer obligations shall include, but not
be limited to, the following:
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1. Agency Obligations
a. Provide the Developer with documents in Agency's possession that
would assist the Developer with the due diligence activities
described in this Agreement;
b. Upon acceptance of the Site Plan and verification of Developer
financial ability to lease the Site and develop the Project, prepare
and attempt to finalize a DDA. Developer's financial ability may
be established with evidence of the financial strength or credit
standing of its principals, and if based on the credit standing of its
principals, on the availability of appropriate financing;
C. Provide the Developer with timely and reasonable responses from
the Agency staff, and use reasonable efforts to cause City staff and
associated City departments reviewing the Developer's Site Plan to
provide timely and reasonable responses;
d. Provide the Developer feedback and clear communication of
Agency expectations regarding any and all documentation related
to the Site Plan submitted by the Developer; and
e. Participate in the selection of and approve the architect.
2. Developer Obligations
a. Use its commercially reasonable efforts to investigate the Site;
b. Timely submit preliminary drafts of the following items: site plans,
building exterior elevations, schematic drawings, detailed Project
development costs, Project pro formas summarizing the total
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Project and prospective returns and other related documents
necessary for Agency and City review and reasonably requested of
Developer; and
C. Timely submit projected sources of equity and other capital to
lease the Site and develop and operate the Project.
III. COSTS AND EXPENSES
Each party shall be responsible for its own costs and expenses in connection with any
activities and negotiations undertaken in connection with the performance of its obligations
under this Agreement.
IV. RETENTION OF DISCRETION TO APPROVE THE PROJECT, ENTITLEMENTS
AND DDA; NO PRE -COMMITMENT
It is anticipated that the Project and the DDA will be presented to the Agency Board for
approval and to the City Council for its consent thereto. It is also anticipated that the City
Council and/or Planning Commission will be required to review and approve necessary Project
land use entitlements and environmental documentation at a later date. The parties understand
that Agency and the City are reserving the right to exercise their discretion as to all matters which
they are, by law, entitled or required to exercise their discretion, including, but not limited to the
following:
A. Approval by gency of the Final Project as Contained in the DDA
The parties understand that Agency has the complete and unfettered discretion to reject
the DDA without explanation or cause. The risk of loss of all processing, design and
developmental costs incurred by Developer prior to DDA approval and execution shall be
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absorbed entirely by Developer unless expressly assumed, by the terms of this Agreement, by
Agency.
B. Review and Approval by Agency of all Discretionary Findings and Conclusions
The duty of Agency to execute the Lease shall be conditioned upon the successful review
and approval of all necessary findings and conclusions which the Agency Board is required to
make, including all necessary findings and determinations required under the CEQA, state and
local land use provisions, and the California Community Redevelopment Law. As to any matter
which Agency may be required to exercise its unfettered discretion in advancing the Project to
completion, nothing herein, nor to be contained in the DDA shall obligate Agency to exercise its
discretion in any particular manner, and any exercise of discretion reserved hereunder or required
by law, shall not be deemed to constitute a breach of Agency duties under this Agreement.
C. No Pre -Commitment by Agencv
By its execution of this Agreement, Agency is not committing itself or agreeing to
undertake any activity requiring the subsequent exercise of discretion by Agency, or any
department thereof including, but not limited to, the approval and execution of a DDA; the
approval of any development proposal or land use regulation governing the Site; the provision of
financial assistance for the development of any public or private interest in real property; or any
other such act or approval.
This Agreement does not constitute a disposition of property or exercise of control over
property by Agency and does not require a public hearing. Agency execution of this Agreement
is merely an agreement to enter into a period of exclusive negotiations according to the terms
hereof, reserving final discretion and approval by Agency as to any proposed DDA and all
proceedings and decisions in connection therewith.
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D. City Not A Party.
The City of La Quinta is not a party to this Agreement, and nothing herein constitutes or
shall be construed or deemed as any agreement by City to approve or issue any permit or take any
discretionary action with respect to the Project.
V. THE DEVELOPER
A. Developer Experience
As a condition precedent to Agency's execution of this Agreement, Developer shall have
submitted to Agency a detailed description of the development experience of Developer and its
principals, associates, employees, partners, and joint ventures.
B. Offices of Developer
The principal offices of Developer are located at:
46-735 Adams Street
La Quinta, CA 92253
Facsimile: (760) 771-0686
C. Project Manager
The Project Manager(s) for Developer will be Michael Shovlin, and John Durso. Other
employees, consultants, or representatives who are proposed to be directly involved in the Project
will be determined by Developer and submitted to Agency upon any such determination.
D. Full Disclosure
The Developer shall upon request of Agency, provide full disclosure to Agency of the
identity of its principals, officers, stockholders, partners, joint ventures, and all other pertinent
information concerning the Developer.
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E. Assignment
Developer may not assign, hypothecate, encumber, or otherwise transfer (voluntarily or
involuntarily) this Agreement or any of its rights or obligations hereunder (whether in whole or in
part) (each, an "Assignment") without the prior written approval of Agency Executive Director,
which approval may be given or withheld in Agency Executive Director's sole and absolute
discretion; provided, however, that notwithstanding the foregoing, Agency agrees to approve an
Assignment by Developer of its rights under this Agreement to an entity in which Developer or
Michael J. Shovlin, Claudia Shovlin and John Durso, directly or indirectly own the majority
beneficial or equity interest and Michael J. Shovlin maintains operational control. Regardless,
any such Assignment shall not release Developer from liability from its obligations under this
Agreement. Any Assignment Agency has approved shall not be effective unless and until
Developer submits a signed assignment and assumption agreement in a form and with content
reasonably approved by Agency legal counsel.
VI. ENVIRONMENTAL REQUIREMENTS
Agency and Developer acknowledge and agree that all environmental documentation
required pursuant to CEQA and local regulations for development of the project on the Site will
need to be prepared and, at the time it is necessary to prepare such documentation, Developer
shall assist the Agency and City with the preparation of all such necessary environmental
documents as required by CEQA and local regulations, for certification or adoption by the City.
Developer agrees to cooperate with the City and Agency, as requested, to help determine the
environmental impact of the proposed development and to assist the Agency and City to prepare
any other additional documents as may be needed to complete environmental review for the
development of the Project on the Site; provided, however, that Agency and the City shall not
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reimburse Developer for costs incurred by Developer in assisting Agency and City to prepare
such documentation.
VII. REAL ESTATE COMMISSIONS
Each party severally represents and warrants to the other party, that the representing party
has not engaged a broker, agent, or finder in connection with this transaction. Each party agrees
to defend, indemnify, and protect and hold the other party harmless from any such claims
contrary to the representation or warranty of the applicable party in the preceding sentence.
VIII. GENERAL PROVISIONS
A. Legal Actions; Governing Law; Service of Process
In addition to any other rights or remedies, either party may institute legal action to cure,
correct or remedy any default, to recover actual damages for any default, or to obtain any other
remedy consistent with the purposes of this Agreement; provided, however, that Paragraph C of
this Section VIII of this Agreement shall supersede any conflicting provisions of this
Paragraph A. Such legal actions must be instituted and maintained in the Superior Court of the
County of Riverside, State of California, or in any other appropriate court in that county. The
laws of the State of California shall govern the interpretation and enforcement of this Agreement.
In the event that any legal action is commenced by Developer against Agency, service of process
on 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. In the event that any legal action is
commenced by Agency against Developer, service of process on Developer shall be made by
personal service upon Developer or in such other manner as may be provided by law, and shall
be valid whether made within or without the State of California.
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B. Rights and Remedies are Cumulative
Except as otherwise expressly stated in this Agreement, the rights and remedies of the
parties are cumulative, and the exercise by either party of one or more of its rights or remedies
shall not preclude the exercise by it, at the same or different times, of any other rights or
remedies for the same default or any other default by the other party.
C. Specific Performance as Developer's Exclusive Remedy
Subject to Developer's right to terminate this Agreement in accordance with the terms of
Paragraph E of this Section VIII, Developer's exclusive remedy for an uncured Agency default
under this Agreement is to institute an action for specific performance of the terms of this
Agreement, and in no event shall Developer have the right, and Developer expressly waives the
right, to seek monetary damages of any kind (including but not limited to actual damages,
economic damages, consequential damages, or lost profits) from Agency in the event of a default
by Agency under this Agreement or any action related to this Agreement. Notwithstanding the
foregoing, Developer shall retain the right to seek a writ of mandate in the event of any final
denial by Agency of any Agency permit approval pertaining to the Project. This provision shall
not govern any future agreements entered into by the Agency.
D. Attorney's Fees
The parties hereto acknowledge and agree that each such party shall bear its own legal
costs incurred in connection with the negotiation, approval, and execution of this Agreement.
E. Termination Rights
Notwithstanding the nominal Negotiation Period hereinabove set forth, either party may
terminate this Agreement if the other party has materially defaulted in its obligations herein set
forth, and the terminating party has provided the defaulting party with written notification of
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such determination, and the defaulting party has refused or failed to cure same prior to the
expiration of the cure period below. The written notification shall set forth the nature of the
actions required to cure such default if curable. The Defaulting party shall have thirty (30) days
from the date of the written notification to cure such default. If such default is not cured within
the thirty (30) days, the termination shall be deemed effective. For purposes of this paragraph,
the parties hereby acknowledge that time is of the essence. Each party shall also have the right to
terminate this Agreement in the event that (i) Agency or Developer determines that the Project is
infeasible, based on financial or environmental impact considerations, or not in the public
interest; or (ii) the parties reach an impasse in their negotiation of the DDA or Lease which
cannot be resolved after good faith efforts.
F. Indemnity
Developer shall indemnify, protect, defend and hold harmless Agency and City and
Agency's and City's respective elected officials, officers, employees, representatives, members,
and agents from and against any and all challenges to this Agreement, or any and all losses,
liabilities, damages, claims or costs (including attorneys' fees) arising from Developer's
negligent acts, errors, or omissions with respect to its obligations hereunder or the Site, excluding
any such losses arising from the sole negligence or sole willful misconduct of Agency or the
conduct of third parties not under contract to or associated with, and outside the control of,
Developer. This indemnity obligation shall survive the termination of this Agreement.
G. Notices Demands and Communications Between the Parties
Formal notices, demands, and communications between Agency and Developer shall be
given either by (i) personal service with a receipt obtained, (ii) delivery by reputable document
delivery service such as Federal Express that provides a receipt showing date and time of
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delivery, or (iii) or by mailing in the United States mail, certified mail, postage prepaid, return
receipt requested, addressed to:
To Agency: La Quinta Redevelopment Agency
78-495 Calle Tampico
La Quinta, CA 92253
Attn: Executive Director
Telephone: (760) 777-7000
Facsimile: (760) 777-7101
With a copy to: Rutan & Tucker, LLP
611 Anton Blvd., Suite 1400
Costa Mesa, California 92626
Attn: M. Katherine Jenson, Esq.
Telephone: (714) 641-5100
Facsimile: (714) 546-9035
To Developer: Desert Cities Development, Inc.
46-735 Adams Street
La Quinta, CA 92253
Attn: Mr. Michael Shovlin
Telephone: (760) 771-3345
Facsimile: (760) 771-0686
With Copy to: Mark Tipperman, Esq.
1108 Adams Avenue
La Grande, OR 97850
Facsimile: (541) 962-6230
With Additional Copy to: Daniel Olivier
45-025 Manitou Drive, Suite 10
Indian Wells CA 92210
Facsimile (760) 772-0027
Notices personally delivered or delivered by document delivery service shall be deemed
effective upon receipt. Notices mailed in the manner provided above shall be deemed effective
on the second business day following deposit in the United States mail. Such written notices,
demands, and communications shall be sent in the same manner to such other addresses as either
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party may from time to time designate by formal notice given in accordance with this Section
(G)1.
H. Nonliability of City and Agency Officials and Employees
No member, official, employee, or contractor of Agency or City shall be personally liable
to Developer in the event of any default or breach by Agency or for any amount which may
become due to Developer or on any obligations under the terms of the Agreement.
No boardmember, manager, partner, officer, employee or agent of Developer shall be
personally liable to Agency in the event of any default or breach by Developer or for any amount
which may become due to Agency or on any obligation under the terms of the Agreement.
L Enforced Delay, Extension of Times of Performance
In addition to specific provisions of this Agreement, performance by either party (who is
not then otherwise in material default) shall not be deemed to be in default where delays or
defaults are due to war, insurrection, strikes, lock -outs, riots, floods, earthquakes, fires,
casualties, supernatural causes, acts of the public enemy, terrorism, epidemics, quarantine
restrictions, freight embargoes, lack of transportation, governmental restrictions or priority,
litigation, unusually severe weather, inability to secure necessary labor, materials or tools, delays
of any contractor, subcontractor or supplies, acts of the other party, acts or failure to act of
Agency or City or any other public or governmental agency or entity, including, without
limitation, unreasonable delays in the processing and issuance of required permits for the Project
required by Developer (except that any act or failure to act of Agency shall not excuse
performance by Agency) or any other causes beyond the reasonable control or without the fault
of the party claiming an extension of time to perform, for up to a maximum cumulative period of
one hundred eighty (180) days. Notwithstanding the foregoing, inability to secure satisfactory
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financing, tenant commitments, or market and economic conditions shall not entitle Developer to
an extension of time to perform. An extension of time for any such cause shall be for the period
of the enforced delay and shall commence to run from the time of the commencement of the
cause, if notice by the party claiming such extension is sent to the other party within ten (10) days
of knowledge of the commencement of the cause. In addition, times of performance under this
Agreement may be extended by mutual written agreement by Agency and Developer.
J. Interpretation
The terms of this Agreement shall be construed in accordance with the meaning of the
language used and shall not be construed for or against either party by reason of the authorship of
this Agreement or any other rule of construction which might otherwise apply. The Section and
Paragraph headings are for purposes of convenience only, and shall not be construed to limit or
extend the meaning of this Agreement.
K. Entire Agreement Waivers, and Amendments
This Agreement integrates all of the terms and conditions mentioned herein, or incidental
hereto, and supersedes all negotiations or previous agreements between the parties with respect
to all or any part of the subject matter hereof. All waivers of the provisions of this Agreement
must be in writing and signed by the appropriate authorities of the party to be charged, and all
amendments and modifications hereto must be in writing and signed by the appropriate
authorities of Agency and Developer. Without limiting the foregoing, the parties understand that
the results of this Agreement may lead to future agreements or obligations which shall only
become valid (if at all) upon full execution of such future agreements.
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L. Counterparts
This Agreement may be executed in counterparts, each of which, after all the parties
hereto have signed this Agreement, shall be deemed to be an original, and such counterparts shall
constitute one and the same instrument.
M. Successors
Subject to the limitations on Assignments above, this Agreement shall be binding upon
and shall inure to the benefit of the permitted successors of each of the parties hereto.
N. Further Assurances
The parties hereto each agree, without further consideration, to execute such other and
further documents, and to perform such other and further acts, as may be reasonably necessary or
proper in order to consummate the transaction set forth in and contemplated by this Agreement.
O. Severability
In the event any section or portion of this Agreement shall be held, found, or determined
to be unenforceable or invalid for any reason whatsoever, the remaining provisions shall remain
in effect, and the parties hereto shall take further actions as may be reasonably necessary and
available to them to effectuate the intent of the parties as to all provisions set forth in this
Agreement.
P. Time is of the Essence
Time is of the essence for each of the parties' obligations under this Agreement.
Q. Extension by Agency Executive Director
The Agency Executive Director is authorized, in his sole and absolute discretion, to
extend pursuant to a written agreement with Developer, the time for Developer's performance
under this Agreement for a cumulative period of up to one hundred twenty (120) days.
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R. Confidentiality
Developer acknowledges and agrees that Agency is a public entity with a responsibility
and, in many cases, a legal obligation to conduct its business in a manner open and available to
the public. Accordingly, any information provided by Developer to Agency with respect to the
Site, the Project or Developer may be disclosed to the public either purposely, inadvertently, or
as a result of a public demand or order.
IN WITNESS WHEREOF, Agency and Developer have executed this Agreement on the
respective dates set forth below.
"AGENCY"
Dated: / h / % LA QUINTA REDEVELOPME T AGENCY
By:
Agency Executive Director
ATTEST:
By: `
Veronica J. Nloccino, CMC, Secretary
APPROVED AS TO FORM:
RUT cTUCKER LP
Agency Counsel
Dated:
"DEVELOPER"
DESERT CITIES DEVELOPMENT, INC., a
California corporation
By: /
Title:
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EXHIBIT A
DEPICTION OF 19.9 ACRE PROPERTY
[TO BE INSERTED]
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EXHIBIT B
DEPICTION OF THE SITE
[TO BE INSERTED]
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EXHIBIT C
EARLY ENTRY AGREEMENT
This Early Entry Agreement ("Agreement") is entered into as of , 2006, by
and among the LA QUINTA REDEVELOPMENT AGENCY, a public body, corporate and
politic ("Agency") and DESERT CITIES DEVELOPMENT, INC., a California corporation
("Developer"), with reference to the following facts:
RECITALS
A. Agency is the present owner of that certain real property located in the La Quinta
Redevelopment Project Area No. 2, described on Exhibit "1" hereto ("Site").
B. Agency has executed, or will execute, concurrent with the execution of this
Agreement, that certain Exclusive Negotiation Agreement with Developer ("ENA"), pursuant to
which Agency and Developer will negotiate the possible lease of the Site by Developer for
Developer's development on the Site of a multi -family affordable housing development with
dwellings rented, at affordable housing costs, to family households ("Project").
C. Developer has requested the right to enter onto and about the Site to perform
certain work specified herein, and Agency is willing to allow such entry on the terms and
conditions hereinafter specified.
NOW, THEREFORE, in consideration of the covenants and agreements contained herein
and for other valuable consideration, the sufficiency and receipt of which are hereby
acknowledged by the parties hereto, the parties covenant and agree as follows:
1. Grant of License. Agency hereby grants to Developer and its employees, agents,
consultants, and contractors ("Related Parties") a license for the term set forth in Paragraph 3
("License") to enter upon the Site between the hours of 8:00 a.m. and 5:00 p.m., Monday through
Friday, for the purposes of inspecting, surveying and testing, including geotechnical, soils and
environmental tests, on said Site ("Permitted Work") in connection with the proposed use or
lease thereof for development of the Project. Notwithstanding the above, at least forty-eight (48)
hours prior to any of the Related Parties entering the Site, Developer shall notify Agency of its
intention of the same. Said notice shall be provided by facsimile, addressed to the person listed
in Section 8.8 hereof at the number provided therein. Agency may reject any proposed entry, in
the exercise of its reasonable discretion, by providing telephonic notification to Developer at
least twenty-four (24) hours prior to Developer's proposed entry, to the person listed in Section
8.8 hereof, at the number provided therein, which notice shall specify the reason for such
rejection.
Agency has full right, title and authority to grant Developer the License for the Permitted
Work, and no third party permission or consent is needed in connection therewith. Such License
shall be non -revocable for the Term defined in Paragraph 3 below, except as otherwise set forth
herein. Agency specifically agrees that Developer shall have access to and be entitled to inspect
2156/015610-0047
790114 04 a03/06/07 -1-
all portions of the Site, including without limitation, any structures located thereon, provided,
however, that neither Developer nor any of the Related Parties shall interfere with any other real
or personal property, or enter upon any other real property, without first obtaining the written
consent of the owner(s) of such other real or personal property.
2. Revocation. Agency may revoke this License upon two (2) days written notice to
Developer delivered in accordance with Subparagraph 8.8 below in the event (i) in the
reasonable judgment of Agency, such revocation is necessary to protect the public health, safety,
or welfare pursuant to the exercise of Agency's police powers; or (ii) Developer is in violation of
the terms of this Agreement or any applicable law, statute, ordinance, rule, or regulation
pertaining to the Permitted Work or Developer's or the Related Parties' entry upon the Site
pursuant to this Agreement, and Developer has failed to cure such violation within two (2) days
following Developer's receipt of notice of such violation from Agency.
3. Term. The term of the License shall commence on full execution hereof and shall
terminate on the earlier of (i) the execution of a disposition and development agreement as
described in the ENA, (ii) one hundred twenty (120) days from the date hereof, or (iii)
termination of the ENA pursuant to the terms and conditions set forth in the ENA.
4. Repair and Restoration of Site. Developer shall repair any damage it causes to the
Site in the course of conducting its investigations pursuant hereto and shall restore the Site to the
condition existing prior to Developer's or Related Parties' entry onto the Site, unless this
requirement is waived by the Agency Executive Director in his sole and absolute discretion.
5. Compliance with Laws. Developer shall obtain, at is sole cost and expense, all
governmental permits and authorizations required by any governmental agencies for the
Permitted Work. Developer shall comply with, and shall cause all of its Related Parties to
comply with, all applicable governmental laws, rules, regulations and requirements governing the
Permitted Work. Prior to Developer's or any of the Related Parties' entry onto the Site to
perform any Permitted Work, Developer shall have prepared, obtained approval from the City
thereof, and implemented, a dust control program.
6. Indemnity. Developer shall protect, defend, indemnify and hold harmless Agency
and the City of La Quinta ("City") and Agency's and City's respective officers, officials,
members, employees, agents, and representatives (any of the foregoing shall be known
individually as "Indemnitee" and collectively as "Indemnitees"), and each of them, jointly and
severally, against and from any and all claims, demands, causes of action, damages, costs,
expenses, losses and liabilities, at law or in equity, of every kind or nature whatsoever related to
Developer's exercise of its rights hereunder, including attorneys' fees and expert witness fees, but
excluding those resulting from environmental contamination of the Site or other defects on the
Site existing prior to Developer's entry thereon or not otherwise caused by Developer or any of
the Related Parties, but including, without limitation, injury to or death of any person or persons
and damage to or destruction of any property, threatened, brought or instituted ("Claims"), arising
out of or in any manner directly or indirectly connected with the entry upon the Site by Developer
or any of its Related Parties and the performance of the Permitted Work, including without
limitation:
2156/015610-0047
790114 04 a03/06/07 -2-
(a) any damage to the Site and any liability to any third party incurred by
reason of any acts or omission of, or any commission of any negligent or tortious acts, by
Developer or its Related Parties;
(b) any mechanics' or materialmen's liens, claims, demands, actions or suits
arising (directly or indirectly) from (i) any work performed or materials supplied to or for
Developer, or (ii) any activities of any of its Related Parties on or relating to the Site (including,
without limitation, any claims by any of such Related Parties); and
(c) any costs of removing Developer or its Related Parties from the Site after
the expiration of the term hereof unless Developer is otherwise entitled to possession of the Site
at such time.
7. Insurance. Developer shall procure and maintain during the term of this
Agreement, including any holdover period, commercial general liability insurance in an amount
not less than Two Million Dollars ($2,000,000). Agency and City and Agency's and City's
respective officers, officials, members, employees, agents, and representatives shall be named
additional insureds on such policy/ies. Developer's insurance required hereunder shall (i) be
primary insurance and not contributory with any other insurance Developer may have; (ii) not
contain any special limitations on the scope of protection afforded to Developer and its officers,
partners, officials, members, employees, agents, and representatives; (iii) be "date of occurrence"
and not "claims made" insurance; (iv) apply separately to each insured against whom claim is
made or suit is brought, except with respect to the limits of the insurer's liability; (v) shall
provide that the policy shall not be cancelled by the insurer or Developer unless there is a
minimum of thirty (30) days prior written notice to Developer and Agency; and (vi) shall be
written by a good and solvent insurer rated with a BEST rating of no less than B+ Class X,
licensed by or having admitted status in the State of California, and registered with the California
State Department of Insurance. The deductible or self -insured retention must be declared to the
Agency Executive Director, who in his/her sole discretion may require the insurer to reduce such
deductible or self -insured retention (but in no event shall such deductible or self -insured
retention be required to be reduced below Ten Thousand Dollars [$10,000]) with respect to
Agency and City and Agency's and City's respective officers, officials, members, employees,
agents, and representatives; or Developer may be required to procure a bond guaranteeing
payment of losses and related investigation, claims administration, and defense expenses.
Developer shall furnish or cause to be furnished to the Agency Executive Director, prior to the
entry on the Site pursuant to this Agreement, certificates of insurance with bear original
signatures of authorized agents and which reflect insurer' names and addresses, policy numbers,
coverage limits, deductibles and self -insured retentions. Additionally, Developer shall furnish
certified copies of all policy endorsements required herein. All certificates and endorsements
must be received and approved by the Agency before work commences. Agency reserves the
right to require at any time complete, certified copies of any or all required insurance policies and
endorsements. Prior to any such entry, Developer shall also provide evidence reasonably
satisfactory to the Agency Executive Director that Developer or any contractor with whom
Developer has contracted for the performance of work on or around the Site carries workers'
compensation insurance as required by law.
8. Miscellaneous.
2156/015610-0047
790114 04 a03/06/07 _3
8.1 Authority. Each signatory hereto warrants to the other party that it has
authority to sign on behalf of the party for whom it purports to sign.
8.2 Attorney's Fees. In the event any party hereto brings suit to enforce the
terms of this Agreement or on account of breach hereof, the party not prevailing in such suit shall
pay all reasonable costs and expenses incurred by the other party in such suit, including, without
limitation, court costs, attorneys' fees, and expert witness fees.
8.3 Entire Agreement. This Agreement sets forth the entire agreement of the
parties with respect to the subject matter hereof and supersedes all prior discussions,
negotiations, understandings or agreements relating thereto.
8.4 Counterparts. This Agreement may be executed in two or more
counterparts, each of which will be deemed an original, but all of which together will constitute
one and the same agreement.
8.5 Litigation Matters. The Municipal and Superior Courts of the State of
California in the County of Riverside shall have the exclusive jurisdiction of any litigation
between the parties arising out of this Agreement. This Agreement shall be governed by, and
construed under, the laws of the State of California. Service of process on Agency shall be made
in the manner required by law for service on a public entity. Service of process on Developer
shall be made in any manner permitted by law and shall be effective whether served within or
outside of California.
8.6 Non -liability of Agency Officers and Employees. No officer, official,
member, employee, agent, or representative of Agency shall be personally liable to Developer, or
any successor or assign of same, in the event of any default or breach by Agency, or for any
amount which may become due to Developer, or any successor or assign of same, or for breach
of any obligation of the terms of this Agreement.
8.7 Covenant Against Discrimination. Developer covenants for itself, its
heirs, executors, assigns, and all persons claiming under or through it, that there shall be no
discrimination against any person on account of race, color, creed, religion, sex, marital status,
national origin, or ancestry, in the performance of this Agreement.
8.8 Notices. All notices required to be delivered under this Agreement or
under applicable law shall be personally delivered, or delivered by United States mail, prepaid,
certified, return receipt requested, or.by reputable document delivery service that provides a
receipt showing date and time of delivery. Notices personally delivered or delivered by a
document delivery service shall be effective upon receipt. Notices delivered by mail shall be
effective at 5:00 p.m. on the second business day following dispatch. Notices shall be delivered
to the following addresses:
2156/015610-0047 _
790114 04 a03/06107 -4
To Agency: La Quinta Redevelopment Agency
78-495 Calle Tampico
La Quinta, CA 92253
Attn: Executive Director
Telephone: (760) 777-7000
Facsimile: (760) 777-7101
With a copy to: Rutan & Tucker, LLP
611 Anton Blvd., Suite 1400
Costa Mesa, California 92626
Attn: M. Katherine Jenson, Esq.
Telephone: (714) 641-5100
Facsimile: (714) 546-9035
To Developer: Desert Cities Development, Inc.
46-735 Adams Street
La Quinta, CA 92253
Attn: Mr. Michael Shovlin
Telephone: (760) 771-3345
Facsimile: (760) 771-0686
With Copy to: Mark Tipperman, Esq.
1108 Adams Avenue
La Grande, OR 97850
Facsimile: (541) 962-6230
Changes in the address to be used for receipt of notices shall be effected in accordance with this
Paragraph 8.8.
Agreement.
8.9 Time of Essence. Time is of the essence in the performance of the
[Signatures on following page.]
2156/015610-0047 _
790114.04 a03/06/07 -5
IN WITNESS WHEREOF, this Agreement has been executed by the parties
hereto as of the date first above -written.
"DEVELOPER"
DESERT CITIES DEVELOPMENT, INC., a
California corporation
EA
Name:
"AGENCY"
LA QUINTA REDEVELOPMENT AGENCY,
a public body, corporate and politic
LN
Agency Executive Director
2156/015610-0047 c
790114 04 a03/06/07 -V
EXHIBIT " 1 "
DEPICTION OF SITE
[TO BE INSERTED]
2156/015610-0047
790114.04 a03/06/07
P.O. Box 1504
78-495 CALLS TAMPICO
LA QUINTA, CALIFORNIA 92253
July 20, 2007
Via Telecopier and U.S. Mail
Mr. Michael Shovlin
Desert Cities Development, Inc.
46-735 Adams Street
La Quinta, CA 92253
Re: Extension of Exclusive Negotiation Agreement
(760)777-7000
FAX (760) 777-7101
Pursuant to Section Q of the EXCLUSIVE NEGOTIATION AGREEMENT entered into
on March 19, 2007, by and between the LA QUINTA REDEVELOPMENT AGENCY,
("Agency"), and DESERT CITIES DEVELOPMENT, INC. ("Developer"), on behalf of
the Agency I hereby grant Developer an additional 120 days from July 19, 2007,
to perform Developer's obligations under the Agreement. Please execute below to
reflect your agreement to this extension.
Sincerely,
LA QUINTA REDEVELOPMENT AGENCY
Thomas P. Genovese
Executive Director
ATTEST:
By:
Veronica J. Mo cino, CMC, Secretary
119/015610-0047
830325.01 a07/26/07
APPROVED AS TO FORM:
RUTAN &TUCKER, LLP
Agency Counsel
Dated:
cc: Mark Tipperman, Esq.
1 108 Adams Avenue
La Grande, OR 97850
Facsimile: (541) 962-6230
"DEVELOPER"
DESERT CITIES DEVELOPMENT, INC., a
California corporation
By: '
Title: 6
119/015610-0047
830325.01 a07/20/07 -2-
Dated:
cc: Mark Tipperman, Esq.
1108 Adams Avenue
La Grande, OR 97850
Facsimile: (541) 962-6230
"DEVELOPER"
DESERT CITIES DEVELOPMENT, INC., a
California corporation
IN
Title:
119/015610-0047 830325.01 e07/20/07 -2_
AMENDMENT NO. 1 TO EXCLUSIVE NEGOTIATION AGREEMENT
THIS AMENDMENT NO. I TO EXCLUSIVE NEGOTIATION AGREEMENT
("Amendment No. 1") is made and entered into as of November 6, 2007 by and between LA
QUINTA REDEVELOPMENT AGENCY, a public body, corporate and politic ("Agency"), and
DESERT CITIES DEVELOPMENT, INC., a California corporation ("Developer").
RECITALS:
A. On or about March 19, 2007, the Agency and Developer entered into that certain
Exclusive Negotiation Agreement (the "ENA"), pursuant to which Agency and Developer
agreed to initiate exclusive negotiations for up to one hundred twenty (120) days concerning the
possible sale by Agency to Developer of certain real property owned in fee by the Agency for the
Developer's subsequent development thereon of a multifamily affordable rental housing project,
all as more fully described in the ENA.
B. Pursuant to authority granted in the ENA, the Agency's Executive Director has
extended the "Negotiation Period" (as that term is defined in the ENA) for one hundred twenty
(120) days, until November 19, 2007.
C. As a result of complexities involving environmental studies and CEQA
certification, the parties now wish to further extend the Negotiation Period until August 19, 2008
and to provide the Agency's Executive Director with authority to grant up to an additional six (6)
month extension if the Executive Director determines that such additional time is warranted to
conclude the environmental review process.
AGREEMENT:
NOW, THEREFORE, in consideration of the foregoing recitals, which are incorporated
herein by this reference, and for valuable consideration, the receipt and sufficiency of which is
hereby acknowledged, the parties hereto agree as follows:
1. The ENA is hereby amended to extend the Negotiation Period until August 19, 2008.
The Agency's Executive Director is hereby authorized to grant up to an additional six (6) month
extension to the Negotiation Period if the Executive Director determines, in his or her reasonable
discretion, that such additional time is warranted to conclude the environmental review process
required for the Project" (as that term is defined in the ENA).
2. Except as otherwise expressly provided in this Amendment No. 1, all of the terms and
conditions of the ENA shall remain in full force and effect.
3. In the event of any action between Agency and Developer seeking enforcement of any of
the terms and conditions to this Amendment No. 1, the prevailing party in such action shall be
awarded, in addition to damages, injunctive or other relief, its reasonable costs and expenses,
including without limitation its expert witness fees and reasonable attorney's fees.
882M15610-0084
679900 01 a I 1 /02/07 '�'
L ;
a
4. This Amendment No. 1 shall be construed according to its fair meaning and as if
prepared by both parties hereto.
5. This Amendment No. 1 shall be governed by the internal laws of the State of California
and any question arising hereunder shall be construed or determined according to such law. The
Superior Court of the State of California in and for the County of Riverside, or such other
appropriate court in such county, shall have exclusive jurisdiction of any litigation between the
parties concerning this Amendment No. 1. Service of process on Agency shall be made in
accordance with California law. Service of process on Developer shall be made in any manner
permitted by California law and shall be effective whether served inside or outside California.
6. Time is of the essence of this Amendment No. 1 and of each and every term and
provision hereof.
7. This Amendment No. 1 may be executed in counterparts, each of which, when this
Amendment No. 1 has been signed by all the parties hereto, shall be deemed an original, and
such counterparts shall constitute one and the same instrument.
[End — Signature Page Follows]
882/015610-0084
67990001 al1/02/07 -2-
r"
IN WITNESS WHEREOF, Agency and Developer each hereby represents that it has read
this Amendment No. 1, understands it, and hereby executes this Amendment No. 1 to be
effective as of the day and year first written above.
Date: 6. 31 2007
Date: le /15 , 2007
ATTEST:
Agency Secretary
APPROVED AS TO FORM:
RUTAN & TUCKER, LLP
Agency Counsel
"Developer"
DESERT CITIES DEVELOPMENT, INC.,
a California corporation
Its:
"Agency"
LA QUINTA REDEVELOPMENT AGENCY,
a public body, corporate and politic
By
Agency Executive Director
8821015610-0084
679900 01 all/02/07
-3-
AMENDMENT NO.2 TO EXCLUSIVE NEGOTIATION AGREEMENT
THIS AMENDMENT NO. 2 TO EXCLUSIVE NEGOTIATION AGREEMENT
("Amendment No. 2") is made and entered into as of . a3 , 2008, by and between LA
QUINTA REDEVELOPMENT AGENCY, a public body, corporate and politic ("Agency"), and
DESERT CITIES DEVELOPMENT, INC., a California corporation ("Developer").
RECITALS:
A. On or about March 19, 2007, the Agency and Developer entered into that certain
Exclusive Negotiation Agreement (the "ENA"), pursuant to which Agency and Developer agreed
to initiate exclusive negotiations for up to one hundred twenty (120) days concerning the
possible sale by Agency to Developer of certain real property owned in fee by the Agency for the
Developer's subsequent development thereon of a multifamily affordable rental housing project,
all as more fully described in the ENA.
B. Pursuant to authority granted in Section VIII.Q of the ENA, the Agency's
Executive Director has extended the "Negotiation Period" (as that term is defined in the ENA)
for one hundred twenty (120) days, until November 19, 2007.
C. On or about November, 2007, the parties entered that certain Amendment No. 1 to
Exclusive Negotiation Agreement ("Amendment No. 1") to extend the Negotiation Period to
August 19, 2008.
D. As a result of complexities involving environmental studies, the parties now wish
to further extend the Negotiation Period until May 1, 2009 and to extend the various due
diligence periods under the ENA.
AGREEMENT:
NOW, THEREFORE, in consideration of the foregoing recitals, which are incorporated
herein by this reference, and for valuable consideration, the receipt and sufficiency of which is
hereby acknowledged, the parties hereto agree as follows:
1. The ENA is hereby amended to extend the Negotiation Period until May 1, 2009 and,
therefore the "End Date" as defined in ENA Section II.A shall be May 1, 2009.
2. The ENA is hereby amended to extend the "First Due Diligence Period" (as that term is
defined in ENA Section II.B) to November 1, 2008.
3. The ENA is hereby amended to extend the "Second Due Diligence Period" (as that term
is defined in ENA Section II.C) to February 1, 2009.
4. The ENA is hereby amended to extend the "Third Due Diligence Period" (as that term is
defined in ENA Section ILD) to May 1, 2009.
2156/015610-0047
943048.02 a10/15/08 '�'
5. The provision in ENA Section VIII.Q, which permits the Agency's Executive Director to
extend the time for Developer's performance by up to 120 days, shall be restarted and the
procedure in Section VIII.Q shall apply to any such extensions.
6. Except as otherwise expressly provided in this Amendment No. 2, all of the terms and
conditions of the ENA shall remain in full force and effect; the terms and conditions in this
Amendment No. 2 shall supersede Amendment No. 1.
7. In the event of any action between Agency and Developer seeking enforcement of any of
the terms and conditions to this Amendment No. 2, the prevailing party in such action shall be
awarded, in addition to damages, injunctive or other relief, its reasonable costs and expenses,
including without limitation its expert witness fees and reasonable attorney's fees.
8. This Amendment No. 2 shall be construed according to its fair meaning and as if
prepared by both parties hereto.
9. This Amendment No. 2 shall be governed by the internal laws of the State of California
and any question arising hereunder shall be construed or determined according to such law. The
Superior Court of the State of California in and for the County of Riverside, or such other
appropriate court in such county, shall have exclusive jurisdiction of any litigation between the
parties concerning this Amendment No. 2. Service of process on Agency shall be made in
accordance with California law. Service of process on Developer shall be made in any manner
permitted by California law and shall be effective whether served inside or outside California.
10. Time is of the essence of this Amendment No. 2 and of each and every term and
provision hereof.
11. This Amendment No. 2 may be executed in counterparts, each of which, when this
Amendment No. 2 has been signed by all the parties hereto, shall be deemed an original, and
such counterparts shall constitute one and the same instrument.
[End — Signature Page Follows]
2156MI5610-0047
943048.02 a10/15/08 -2-
IN WITNESS WHEREOF, Agency and Developer each hereby represents that it has read
this Amendment No. 2, understands it, and hereby executes this Amendment No. 2 to be
effective as of the day and year first written above.
Date: �G��^ . 3 O 2008
Date: tecf0,6e/,A.3 12008
APPROVED AS TO FORM:
RUT TUC CER LLP
By:
M. Katherine Jens gency Counsel
"Developer"
DESERT CITIES DEVELOPMENT, INC.,
a California corporation
By, % � s
Its: C �iva
"Agency"
LA QUINTA REDEVELOPMENT AGENCY,
a public body, corporate an pot'
I,
Agency Executive Director
21561015610-0047
943048.02 a10/15/08 -3-
AMENDMENT NO. 3 TO EXCLUSIVE NEGOTIATION AGREEMENT
THIS AMENDMENT NO. 3 TO EXCLUSIVE NEGOTIATION AGREEMENT
("Amendment No. 3") is made and entered into as A41 a,." 2009, by and between LA
QUINTA REDEVELOPMENT AGENCY, a public body, corporate and politic ("Agency"), and
DESERT CITIES DEVELOPMENT, INC., a California corporation ("Developer").
RECITALS:
A. On or about March 19, 2007, the Agency and Developer entered into that certain
Exclusive Negotiation Agreement (the "ENA"), pursuant to which Agency and Developer agreed
to initiate exclusive negotiations for up to one hundred twenty (120) days concerning the
possible sale_ by Agency to Developer of certain real property owned in fee by the Agency for the
Developer's subsequent development thereon of a multifamily affordable rental housing project,
all as more fully described in the ENA.
B. The "Negotiation Period" (as defined in the ENA) has been extended on multiple
occasions, through the execution of two (2) formal ENA amendments, by the Agency Executive
Director in the exercise of his authority pursuant to Section VIII.Q of the ENA, and, most
recently, pursuant to Agency Board approval.
C. As a result of the foregoing extensions, the current "Negotiation Period" will
terminate on December 31, 2009.
D. As a result of complexities involving environmental studies, the parties now wish
to further extend the Negotiation Period until March 31, 2010.
AGREEMENT:
NOW, THEREFORE, in consideration of the foregoing recitals, which are incorporated
herein by this reference, and for valuable consideration, the receipt and sufficiency of which is
hereby acknowledged, the parties hereto agree as follows:
1. The ENA is hereby amended to extend the Negotiation Period until March 31, 2010 and,
therefore the "End Date" as defined in ENA Section II.A, shall be March 31, 2010.
2. The ENA is hereby amended to provide that actions required to be performed during the
"First Due Diligence Period," the "Second Due Diligence Period," and "Third Due Diligence
Period" (as those terms are defined in ENA Sections II.B, II.C, and II.D) shall be completed by
the End Date.
3. The provision in ENA Section VIII.Q, which permits the Agency's Executive Director to
extend the time for Developer's performance by up to 120 days, shall be restarted and the
procedure in Section VIII.Q shall apply to any such extensions.
882/015610-0103
1052392 01 .12/03/09 - t -
4. Except as otherwise expressly provided in this Amendment No. 3, all of the terms and
conditions of the ENA shall remain in full force and effect; the terms and conditions in this
Amendment No. 3 shall supersede Amendment No. 1.
5. In the event of any action between Agency and Developer seeking enforcement of any of
the terms and conditions to this Amendment No. 3, the prevailing party in such action shall be
awarded, in addition to damages, injunctive or other relief, its reasonable costs and expenses,
including without limitation its expert witness fees and reasonable attorney's fees.
6. This Amendment No. 3 shall be construed according to its fair meaning and as if
prepared by both parties hereto.
7. This Amendment No. 3 shall be governed by the internal laws of the State of California
and any question aiazising hereunder shall be construed or determined according to such law. The
Superior Court of the State of California in and for the County of Riverside, or such other
appropriate court in such county, shall have exclusive jurisdiction of any litigation between the
parties concerning this Amendment No. 3. Service of process on Agency shall be made in
accordance with California law. Service of process on Developer shall be made in any manner
permitted by California law and shall be effective whether served inside or outside California.
8. Time is of the essence of this Amendment No. 3 and of each and every term and
provision hereof.
9. This Amendment No. 3 may be executed in counterparts, each of which, when this
Amendment No. 3 has been signed by all the parties hereto, shall be deemed an original, and
such counterparts shall constitute one and the same instrument.
[End — Signature Page Follows].
%921015610-OM
1052392.01 al2/03/09 _2_
IN WITNESS WHEREOF, Agency and Developer each hereby represents that it has read
this Amendment No. 3, understands it, and hereby executes this Amendment No. 3 to be
effective as of the day and year first written above.
Date: 2009
Date: 2009
T:
Veronica J. Mo ecino, Agency Secretary
APPROVED AS TO FORM:
RUTAN TUCK R, P
By:
M: Katherine Jenso , gency Counsel
"Developer"
DESERT CITIES DEVELOPMENT, INC.,
a California corporation
By:`��!/.
Its:/
"Agency"
LA QUINTA REDEVELOPMENT AGENCY,
a public body, corporate and politi
Agency Executive Director
882/01561M103
1052392.01 al2/03/09 -3-
AMENDMENT NO. 4 TO EXCLUSIVE NEGOTIATION AGREEMENT
THIS AMENDMENT NO. 4 TO EXCLUSIVE NEGOTIATION AGREEMENT
("Amendment No. 4xc") is made and entered into as of July 20, 2010, by and
between LA QUINTA REDEVELOPMENT AGENCY, a public body, corporate and
politic ("Agency"), and DESERT CITIES DEVELOPMENT, INC., a California
corporation ("Developer").
RECITALS:
A. On or about March 19, 2007, the Agency and Developer entered into
that certain Exclusive Negotiation Agreement (the "ENA"), pursuant to which
Agency and Developer agreed to initiate exclusive negotiations for up to one
hundred twenty (120) days concerning the possible sale by Agency to Developer of
certain real property owned in fee by the Agency for the Developer's subsequent
development thereon of a multifamily affordable rental housing project, all as more
fully described in the ENA.
B. The "Negotiation Period" (as defined in the ENA) has been extended
on multiple occasions, through the execution of three (3) formal ENA Amendments,
by the Agency Executive Director in the exercise of his authority pursuant to
Section VIII.Q of the ENA, and, most recently, pursuant to Agency Board approval.
C. As a result of the foregoing extensions, the current "Negotiation
Period" will terminate on July 29, 2010.
D. As a result of complexities involving environmental studies and
Stormwater retention issues, the parties now wish to further extend the
Negotiation Period until December 31, 2010.
AGREEMENT:
NOW, THEREFORE, in consideration of the foregoing recitals, which are
incorporated herein by this reference, and for valuable consideration, the receipt
and sufficiency of which is hereby acknowledged, the parties hereto agree as
follows:
1. The ENA is hereby amended to extend the Negotiation Period until December
31, 2010 and, therefore the "End Date" as defined in ENA Section II.A, shall be
December 31, 2010.
2. The ENA is hereby amended to provide that actions required to be performed
during the "First Due Diligence Period," the "Second Due Diligence Period," and
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"Third Due Diligence Period" (as those terms are defined in ENA Sections 11.13, II.C,
and II.D) shall be completed by the End Date.
3. The provision in ENA Section VIII.Q, which permits the Agency's Executive
Director to extend the time for Developer's performance by up to 120 days, shall
be restarted and the procedure in Section VIII.Q shall apply to any such extensions.
4. Except as otherwise expressly provided in this Amendment No. 4, all of the
terms and conditions of the ENA shall remain in full force and effect; the terms and
conditions in this Amendment No. 4 shall supersede Amendment Nos. 1, 2, and 3.
5. In the event of any action between Agency and Developer seeking
enforcement of any of the terms and conditions to this Amendment No. 4, the
prevailing party in such action shall be awarded, in addition to damages, injunctive
or other relief, its reasonable costs and expenses, including without limitation its
expert witness fees and reasonable attorney's fees.
6. This Amendment No. 4 shall be construed according to its fair meaning and
as if prepared by both parties hereto.
7. This Amendment No. 4 shall be governed by the internal laws of the State of
California and any question arising hereunder shall be construed or determined
according to such, law. The Superior Court of the State of California in and for the
County of Riverside, or such other appropriate court in such county, shall have
exclusive jurisdiction of any litigation between the parties concerning this
Amendment No. 4. Service of process on Agency shall be made in accordance
with California law. Service of process on Developer shall be made in any manner
permitted by California law and shall be effective whether served inside or outside
California.
8. Time is of the essence of this Amendment No. 4 and of each and every term
and provision hereof.
9. This Amen ldment No. 4 may be executed in counterparts, each of which,
when this Amendment No. 4 has been signed by all the parties hereto, shall be
deemed an original, and such counterparts shall constitute one and the same
instrument.
[End — Signature Page Follows]
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IN WITNESS WHEREOF, Agency and Developer each hereby represents that
it has read this Amendment No. 4, understands it, and hereby executes this
Amendment No. 4 to be effective as of the day and year first written above.
"Developer"
DESERT CITIES DEVELOPMENT, INC.,
a California corporation
Date: July 21, 2010 By:
Ile
Its:
"Agency"
LA QUINTA REDEVELOPMENT
AGENCY,
a public body, corporate and politic
Date: July 21, 2010
Agency Executive Director
APPROVED AS TO FORM:
RUTAN & TUCKER, LLP
al
e Jens[orj, Agency Counsel
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