HomeMy WebLinkAboutContract 1702 p 6sq 4 cIi ‘
CIA-u'INAL
AGREEMENT TO RECON Y DEED OF TRUST
IN CONSIDERATION FOR GENERAL RELEASE OF LIABILITY
This AGREEMENT TO RECONVEY DEED OF TRUST IN CONSIDERATION FOR
GENERAL RELEASE OF LIABILITY (this "Agreement") is entered into on this 27th day of May,
2015 (the "Effective Date"), by and among the CITY OF CATHEDRAL CITY, a municipal
corporation organized and existing under the laws of the State of California ("City"), and PSRV,
LLC, a Nevada limited liability company ("PSRV"), and VESTIN MORTGAGE, LLC, a Nevada
limited liability company, as successor by conversion of Vestin Mortgage, Inc., a Nevada corporation
("Vestin"), VESTIN REALTY MORTGAGE I, INC., a Maryland corporation, as successor by merger
of Vestin Fund I, LLC, a Nevada limited liability company ("VFI"), VESTIN REALTY MORTGAGE
II, INC., a Maryland corporation, as successor by merger of Vestin Fund II, LLC, a Nevada limited
liability company ("VFII"), VESTIN FUND III, LLC, a Nevada limited liability company ("VFIII" and
together with Vestin, VFI, and VFII, the "Vestin Companies"), on the other hand. The City, PSRV, and
the Vestin Companies are hereinafter sometimes referred to as a "Party"or collectively as the"Parties."
RECITALS
WHEREAS, on or about February 3, 2004, Vestin made a construction loan (the "Loan") in the
amount of THIRTY FIVE MILLION AND NO/100 DOLLARS ($35,000,000.00) to Rio Vista
Nevada,LLC a Nevada limited liability company ("Rio Vista"); and
WHEREAS, the Loan was secured by, among other things, that certain Construction Deed of
Trust, Assignment of Leases and Rent and Security Agreement dated on or about February 3, 2004 (the
"Deed of Trust"), which was given by Rio Vista, as trustor, to First American Title Company, as trustee,
for the benefit of Vestin, as beneficiary; and
WHEREAS, the Deed of Trust was recorded in the Official Records of Riverside County (the
"Official Records") on February 3, 2004 as Document Number 2004-0075872; and
WHEREAS, the Deed of Trust encumbered all that certain real property consisting of fourteen
(14) separate tax parcels, and described on Exhibit A (the "Property"), which is attached hereto, and by
this reference made a part hereof; and
WHEREAS, subsequent to the recordation of the Deed of Trust, certain beneficial interests in the
Deed of Trust were transferred from Vestin to the other Vestin Companies; and
WHEREAS, in lieu of foreclosure, Rio Vista transferred the Property to PSRV pursuant to that
certain Grant Deed dated October 2, 2006 and recorded in the Official Records on July 11, 2007, as
Document Number 2007-0450576; and
WHEREAS, on or about October 4, 2011, the City filed a Complaint in Judicial Foreclosure of
Delinquent Community Facilities District No. 2000-1 Special Taxes in the Indio Branch of the Riverside
Superior Court, Case Number INC 1108104 ("Complaint") seeking to collect on delinquent special taxes
with respect to the Property; and
WHEREAS, the Complaint named PSRV and the Vestin Companies, among others, as
Defendants; and
WHEREAS, on or about September 10, 2012, the City successfully foreclosed on the Property,
as evidenced by a Judgment,which is attached hereto as Exhibit B; and
Page 1 of 4
WHEREAS, on or about August 4, 2014, the Riverside County Sheriff held a Sheriffs Sale
Under Foreclosure("Sale")for thirteen (13)of the fourteen(14)parcels included in the Property; and
WHEREAS, the City was the winning bidder of the thirteen (13) parcels sold at the August 4,
2014 Sale, as evidenced in the Sheriffs Deed recorded in the Official Records on August 4, 2014 as
Document Number 2014-0292884 and attached hereto as Exhibit C; and
WHEREAS, due to a legal description error committed by Lawyers Title Company in
preparation of the litigation guarantee, the City filed a Motion for an Order to Correct Clerical Error in
Judgment and Amend Judgment Nunc Pro Tunc, pursuant to CCP Section 473(d) for the portion of the
Property bearing Assessor's Parcel Number("APN") 677-551-032-8 ("Motion to Correct"); and
WHEREAS, on December 23, 2013,the court entered the order in the City's favor on the Motion
to Correct, thereby including and correcting the legal description of the fourteenth (14th) parcel (i.e. the
portion of the Property bearing APN 677-551-032-8); and
WHEREAS, for purposes of this Agreement, the term "Judgment" will include the Order
Correcting Clerical Error and Amending Judgment Nunc Pro Tunc, December 9, 2013, which includes
the corrected legal description for the portion of the Property bearing APN 677-551-032-8, which
document is attached hereto as Exhibit D; and
WHEREAS, the Sheriffs Sale Under Foreclosure of the fourteenth (14`h) parcel, the portion of
the Property bearing APN 677-551-032-8, is currently set for June 11, 2015; and
WHEREAS, despite the Judgment in foreclosure, a current preliminary title report obtained on
the portion of the Property bearing APN 677-050-031-9 reveals that the lien of the Deed of Trust remains
as a lien on title to the Property; and
WHEREAS, Vestin intends on reconveying the Deed of Trust and therefore relinquishing any
and all of its right, title and interest in and to the Property; and
WHEREAS, the City deems it appropriate to forgive, acquit, and release the Vestin Companies
and PSRV from any and all liability arising from or in any way connected with the Judgment or the
Property.
AGREEMENT
NOW THEREFORE, in consideration of the foregoing recitals, the mutual consideration set
forth in this Agreement, and for other good and valuable consideration, the receipt and sufficiency of
which is hereby acknowledged,the Parties agree as follows:
1. Recitals. The foregoing recitals are true and correct in all material respects, and are
incorporated herein by this reference.
2. Release and Reconveyance.
a. Reconveyance of Deed of Trust to the City. In consideration for the release of
PSRV and the Vestin Companies from any and all liabilities, known or unknown, now existing or
hereafter arising, from or in any way connected with the Judgment or the Property, Vestin does hereby
agree to release and reconvey the Deed of Trust pursuant to that certain Reconveyance of Deed of Trust
attached hereto as Exhibit E (the "Reconveyance"). An executed and notarized copy of the
Page 2 of 4
Reconveyance will be delivered to the City contemporaneously with the execution of this Agreement, and
delivery of the Release (as defined below)by the City.
b. Quitclaim. In an abundance of caution, in addition to the delivery of the
Reconveyance, as provided in Section 2.a. above, PSRV and the Vestin Companies shall,
contemporaneously with the delivery of the Reconveyance, deliver an executed and acknowledged
Quitclaim Deed in the form attached hereto as Exhibit F (the "Quitclaim Deed") conveying any and all
interest any of PSRV or the Vestin Companies may have, if any, in the Property.
c. General Release of Vestin. In consideration of Vestin's delivery of the
Reconveyance and the delivery of the Quitclaim Deed by PSRV and the Vestin Companies, the City on
behalf of itself and its owners, shareholders, officers, directors, employees, agents, successors, assigns,
predecessors,partners,joint venturers,principals, guarantors, subcontractors, suppliers,parent companies,
attorneys and representatives, and the citizens which it represents, does hereby irrevocably remise,
release, acquit, forgive, satisfy and forever discharge and agrees to hold harmless each of PSRV and the
Vestin Companies, and each of their respective direct and indirect (whether former, future and present)
partners, members, shareholders, managers, directors and other equity holders, subsidiaries and other
affiliates, and all of their respective heirs, successors, agents and assigns and attorneys and representatives
(collectively, the "Released Parties") from any and all debts, claims, potential claims, demands,
obligations, any manner of damages, liabilities, losses, costs and expenses (including, without limitation,
attorney fees), and causes of action of any nature whatsoever, at law or in equity, known or unknown,
foreseen or unforeseeable, whether now accrued or subsequently maturing (collectively, the "Claims"and
each individually, a "Claim"), arising with respect to or in any way connected with the Judgment and/or
the Property, and hereby waives any and all such Claims (whether or not such claims are known or
unknown) which they may now hold or own, or held or owned at any time from the beginning of the
Universe through the end of time itself, by reason of or relating to any act, omission, matter or thing
whatsoever which are or may be the subject of this this Agreement.
3. Civil Code Section 1542. The Parties are aware that facts may be discovered later that
are different from and/or in addition to those that the Parties now know or believe to be true concerning
this Agreement. The Parties acknowledge that they have been informed by their attorneys regarding, and
are familiar with California Civil Code § 1542 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 THE
DEBTOR.
The Parties expressly waive all rights not provided for to be retained by this Agreement under Civil Code
§ 1542 and intend that the foregoing releases and discharges extend to all claims, including those that
would otherwise be excepted by operation of Civil Code § 1542. Accordingly, the releases herein given
shall remain in full force and effect as full and complete releases notwithstanding the discovery of the
existence of any additional claims or facts that may have existed at the time of each Parties execution of
this Agreement.
4. Representations. Each of the Parties represents and warrants that they are not aware of
any other party having any interest in, nor have they assigned, hypothecated or otherwise transferred any
interest in any Claim or Claims which are the subject of this Agreement. Vestin represents and warrants
that it is the sole beneficiary of the Deed of Trust. Each Party represents and warrants that it has the full
Page 3 of 4
right and power to enter into this Agreement and to execute and bind all parties identified to the releases
and other provisions contained herein, and agrees to defend and indemnify each other Party in the event
any claim is made which is contrary to the representations and warranties contained herein.
5. No Admission of Liability. This Agreement is a compromise between the Parties hereto
and shall not be construed as an admission of liability by any Party for any purpose.
6. Integration. This Agreement constitutes the entire agreement between the Parties hereto
pertaining to the subject matter hereof and supersedes all prior and contemporaneous agreements and
understandings of the parties; there are no warranties, representations or other agreements between the
parties except as expressly set forth herein. No amendment hereto shall be binding unless set forth in a
writing stating that it is intended to amend this Agreement, executed by the Party to be bound thereby.
No waiver of any of the provisions of this Agreement shall be deemed or shall constitute a waiver of any
of the other provisions hereof, whether or not similar, nor shall such waiver constitute a continuing
waiver.
7. Counterparts. This Agreement may be executed in counterparts and may be transmitted
by facsimile or other electronic means and, as so executed, shall constitute one agreement binding on all
Parties.
8. Severability. In the event that any provision of this Agreement is found by a Court of
competent jurisdiction to be void or voidable, the remaining provisions of this Agreement shall remain in
full force and effect.
9. Attorneys Fees and Costs. If a Party brings legal action to interpret or enforce the terms
of this Agreement, the prevailing Party shall recover, in addition to any other relief, reasonable attorneys'
fees and costs incurred in such action.
10. Choice of Law. This Agreement and any dispute hereunder shall be governed by the
internal laws of the State of California without reference to any choice of law provisions contained
therein.
11. Representation by Counsel. The Parties acknowledge that they have been represented
by independent counsel of their choice with respect to all of the negotiations preceding the execution and
delivery of this Agreement, and that they have executed this Agreement after receiving advice of their
counsel. The Parties further acknowledge that they have read and understood this Agreement and are
entering into this Agreement voluntarily and that this Agreement is not the result of fraud, duress, undue
influence or mistake.
12. Each Party Authorized. By signing this Agreement, each Party's representative attests
that he or she is duly authorized by his or her respective corporation or entity, if applicable, to execute
this Agreement and commit said Party to honor and implement the terms and conditions of this
Agreement.
SIGNATURES COMMENCE ON FOLLOWING PAGE
Page 4 of 4
IN WITNESS WHEREOF, each of the Parties have executed this Agreement as of the Effective
Date.
CITY:
CITY OF CATHEDRAL CITY,
a municipal corporation
NOV
I V
By: ,■ •
, Mayor
ATTEST
By: L . . _ . !AA . 1 . 1
Tracey Mart fr-z, De•uty City Clerk
APPROVED AS TO FORM:
By:
Charles R. Green, City Attorney
SIGNATURES CONTINUE ON NEXT PAGE
Signature Page 1 of 3
SIGNATURES CONTINUED FROM LAST PAGE
PSRV:
PSRV, LLC,
a Nevada limited liability company
By. i
Name: SQi1 - MEE,
Title: A 1.4 / Z4 .is
VESTIN:
VESTIN MORTGAGE,LLC,
a Nevada limited liability company,
as successor by conversion of,
Vestin Mortgage, Inc., a Nevada corporation
By: Name: grilfinigYa .'5
Title: ,■r• .c.d Xfff
SIGNATURES CONTINUE ON NEXT PAGE
Signature Page 2 of 3
SIGNATURES CONTINUED FROM LAST PAGE
VFI:
VESTIN REALTY MORTGAGE I,INC.,
a Maryland corporation,
as successor by merger of
Vestin Fund I, LLC, a Nevada limited liability company
By: alga'
Name: �/Miga'iu-�S
Title: At, o _
VFII:
VESTIN REALTY MORTGAGE II,INC.,
a Maryland corporation,
as successor by merger of
Vestin Fund II,LLC, a Nevada limited liability company
By: r■,-"ZL1
Name: 1 Jinn I Wit
Title:,&o dr17- ,45
VFIII:
VESTIN FUND III, LLC,
a Nevada limited liability company
By: Name: MffitiMe CIS
Title: 4 0 ' - ,e7/1
Signature Page 3 of 3
CATH/0046-57/101.3