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HomeMy WebLinkAboutContract - 02/28/2024 - 2060 COST ' COVERY REIMB 'SEMENT AG' EMENT THIS COST RECOVERY REIMBURSEMENT AGREEMENT("Agreement")is made and entered into as of the 28th day of February 2024 by and among the City of Cathedral City("City"),a California municipal corporation, and NPH Estates, LLC, a California Limited Liability Company, Section 13 Trust, GHP Holdings, LLC, a Delaware Limited Liability Company, collectively("Developer"). RECITALS Developer has submitted or plans to submit applications for the development of approximately 590 acres of land within the North City Extended Specific Plan("NCESP")area.The site of the Proposed Project is illustrated in Attachment A,which is attached hereto and incorporated by this reference.City's processing and consideration of the Proposed Project may require the following approvals,documents and activities(collectively, "Project Approvals"): (1) Entitlements • General Plan Amendment • Zoning Map and Text Amendment • NCESP Recission • Design Review • CEQA • Development Agreement (2) Grading permits,building permits,encroachment permits,transportation permits for approval of a construction haul route(s); (3) Implementation of a mitigation monitoring and reporting program; (4) Public improvements,including design and construction,fee credits and reimbursement agreement(s); (5) Any other approvals, documents,studies,peer review or processing reasonably necessary to develop the Proposed Project. A. Processing of the Proposed Project will require City to incur various costs and expenses including but not limited to staff time,consultant costs, legal fees and costs, and other assorted processing costs. B. In order to facilitate processing of Developer's applications,Developer desires to reimburse City for all of its costs associated with the Proposed Project, including but not limited to: legal fees,staff time and consultant costs incurred in connection with the Project Approvals; costs unbilled and/or unreimbursed by Developer in connection with Project Approvals covered by this Reimbursement Agreement;and any litigation costs incurred as a result of the processing of the Proposed Project and any Project Approvals. C. The parties to this Agreement wish to establish the terms and conditions of such reimbursement obligation. 1 AG EMENT NOW,THEREFORE, in consideration of the foregoing recitals and for other good and valuable consideration,the parties hereby agree as follows: 1. Purpose of Agreement. The purpose of this Agreement is to provide for payment by Developer of all legal,staff and consultant costs directly or indirectly incurred by City in connection with the Proposed Project,including legal defense costs,if any. 2. Developer Reimbursement Obligation.Developer shall reimburse City for the following costs (collectively,"Eligible Costs")incurred in connection with the Proposed Project(including any and all staff and or legal costs incurred following approval of the Proposed Project to process the project to completion): a. City staff time,processing costs,consultant costs and legal fees associated with processing and implementing all Project Approvals and Mitigation Measures including,but not limited to: legal fees and costs incurred in connection with the legal defense of any Project Approvals; legal fees and costs incurred in connection with the negotiation, drafting, implementation, and defense of the proposed Development Agreement;and fees and costs payable to outside consultants in connection with the negotiations of the proposed Development Agreement. b. Fees and costs which City has incurred but which have either not yet been billed for reimbursement or which have not yet been reimbursed to the City. The City has made a good faith estimate to summarize all such fees and costs more particularly described in Attachment B,which is attached hereto and incorporated by this reference. The parties acknowledge that the figures on Attachment B constitute the City's good faith effort to summarize all such fees and costs,and Developer agrees that fees or costs which have inadvertently been omitted from Attachment B,as well as those fees and costs incurred prior the effective date of this Agreement, and are subsequently submitted to Developer,shall be construed as Eligible Costs pursuant to this subsection c. 3. Payment of Eligible Costs.City shall submit to Developer a copy of each invoice,bill,demand or other evidence("Invoice")that the City has incurred for Eligible Costs or other reasonable substantiation of such Eligible Costs. Each such Invoice of Eligible Costs shall be paid in full by Developer,without deduction or offset,within thirty(30)calendar days of receipt of the Invoice. Developer covenants and agrees that failure to pay such Eligible Costs to City in full within thirty (30)calendar days of the receipt of such Invoice will result in a Late Charge in accordance with Section 4 of this Agreement, as well as in the cessation of processing the Proposed Project in accordance with Section 9 of this Agreement until such time as full payment is made.Developer further covenants and agrees that,if as a result of a failure to pay an Invoice of Eligible Costs,City ceases processing the Proposed Project in accordance with Section 9,Developer shall not directly or indirectly initiate any litigation against City or its employees,agents,or volunteers for that cessation or delay in processing the Proposed Project. 2 4. Late Charge.Developer acknowledges that the late payment of any Eligible Costs will cause City to incur additional costs, including administration and collection costs and processing and accounting of expenses("Delinquency Costs"). If City has not received payment of all Eligible Costs within thirty (30)calendar days of the receipt of the Invoice,the Invoice is considered overdue and Developer shall immediately be charged a late charge of five percent(5%)of the delinquent amount.The City is then authorized to pay such Late Charge from the Security Deposit along with the amount of the unpaid Invoice of Eligible Costs in accordance with Section 5.City and Developer recognize that the expenses that City shall suffer as a result of Developer's failure to make timely payments is difficult to ascertain and agree that said five percent(5%)late charge represents a reasonable estimate of the Delinquency Costs that would be incurred by City.City's acceptance of any such late charge does not equate with a waiver of Developer's default with respect to the overdue amount,or prevent City from exercising any rights and remedies available under this Agreement. 5. Security Deposit.Upon Developer's signature of this Agreement,Developer shall deposit with City the sum of fifty thousand dollars($50,000)in cash or other immediately available funds("Security Deposit"),as security for Developer's obligation to pay all Eligible Costs,as provided herein.To the extent additional funds are required to meet the$50,000 Security Deposit amount required by this Agreement,Developer shall deposit such additional amounts upon signature of this Agreement. The Security Deposit shall be subject to the following: a. Developer agrees that if Developer does not pay when due the full amount of each Invoice of Eligible Costs as provided in Section 3 above,then the City is authorized to pay such amount from the Security Deposit,which may include a Late Charge in accordance with Section 4. b. If the City withdraws from the Security Deposit,the City shall immediately notify the Developer in writing that it has used the Security Deposit to pay all or a portion of the bill, invoice, demand or other evidence of Eligible Costs,and the Developer shall thereafter have fourteen(14)calendar days from the date of such written notice to deposit with City,in cash, an amount necessary to restore the Security Deposit to its full amount of$50,000.If the Developer fails to replenish the Security Deposit within said due date,City shall have no obligation to continue processing the Proposed Project or to incur any additional Eligible Costs until such time as restoration of the Security Deposit is completed. c. If the amount of the unpaid Invoice of Eligible Costs and Late Charge exceeds the available funds in the Security Deposit,the City shall immediately notify the Developer in writing that it has used the Security Deposit to pay all or a portion of the bill, invoice,demand or other evidence of Eligible Costs,and the Developer shall have fourteen(14)calendar days from the date of such written notice to deposit with City,in cash,an amount necessary to restore the Security Deposit to its full amount of$50,000,plus the full amount of the unpaid Invoice of Eligible Costs and applicable Late Charge. If the Developer fails to fully replenish the Security Deposit,pay the full Invoice of Eligible Costs and applicable Late Charge within said due date,City shall have no obligation to continue processing the Proposed Project or to incur any additional Eligible Costs until such time as restoration of the Security Deposit, payment of the Invoice,and payment of the applicable Late Charge is completed. 3 d. Developer further covenants and agrees that,if as a result of reduction of the Security Deposit to zero dollars or failure to replenish,City ceases processing the Proposed Project in accordance with Section 9,Developer shall not directly or indirectly initiate any litigation against City or its employees, agents, or volunteers for the failure to process or for delay in processing the Proposed Project following such reduction or failure to replenish. e. If this Agreement is terminated as provided in Section 8 below and all activities related to Project Approvals have ceased and the City is not continuing to incur costs related to the project, City shall return to Developer within ninety(90)calendar days following the effective date of termination that portion of the Security Deposit that has not been expended or committed by City as provided herein, if any. 6. No Commitment as to Future Approvals.Nothing in this Agreement shall be construed as a commitment to grant or issue any Project Approvals or any other preliminary or formal approvals in connection with the Proposed Project or to enter into the proposed Development Agreement or any other agreements. Developer acknowledges and agrees that nothing in this Agreement limits City's discretion,in any manner,with respect to any aspect of the Proposed Project,the proposed Development Agreement,or the proposed real estate transaction and fee credit agreements.Developer agrees that it shall remain obligated to pay all Eligible Costs,regardless of whether any aspect of the Proposed Project is approved and regardless of whether City and Developer enter into the proposed Development Agreement or any other agreements.Notwithstanding the aforementioned, City shall in good faith expeditiously and with all diligence process the Project Approvals. 7. Indemnity.Developer shall,to the greatest extent authorized by law,defend(with counsel approved by City,which approval shall not be unreasonably withheld),indemnify,and hold harmless the City, its officials,employees,volunteers and agents from and against any and all loss,liability,expenses, claims,costs(including reasonable attorneys' fees), suits and damages of every kind nature,and description,directly or indirectly arising from any third party legal challenge to the Project Approvals,or the implementation of this Agreement.Developer may defend against any such third party legal challenge as a Real Party in Interest using counsel of Developer's choice, and Developer and City agree to cooperate in the joint defense of the Project Approvals or the implementation of this Agreement.Developer's indemnity obligations under this Section 7 shall survive the expiration or termination of this Agreement. 8. Termination.Developer may terminate this Agreement by providing thirty(30)calendar days written notice to City.If Developer is in default of any of its obligations under this Agreement and fails to cure such default within fourteen(14)calendar days following written notice from City, then City may terminate this Agreement by notice to Developer and,thereafter,City shall have no further obligation to process Project Approvals for the Proposed Project or to continue with negotiation and drafting of the proposed Development Agreement or any other agreements. Developer shall be responsible for the payment of Eligible Costs incurred by City up to and including the date of termination regardless of which party terminates this Agreement. 9. Cessation of Processing.Developer acknowledges and agrees that City may,in its sole discretion, cease processing the Proposed Project,the Project Approvals,and all negotiations in connection with any proposed Development Agreement or any other agreements,in any of the following events: a. This Agreement is terminated by either party following notice and expiration of any 4 applicable cure periods as provided herein;or b. Developer fails to pay such Eligible Costs to City in full within thirty(30) calendar days of the receipt of such Invoice;or c. The Security Deposit amount is reduced to zero and Developer fails to replenish the Security Deposit upon request by City. Upon payment of Eligible Costs(plus any late fee)and/or replenishment of the Security Deposit,as relevant,the City shall resume processing the Proposed Project,Project Approvals,and all negotiations in connection with any proposed Development Agreement.Developer further covenants and agrees that if City ceases processing the Project Approvals for any of the foregoing reasons,Developer shall not directly or indirectly initiate any litigation against City or its employees,agents,or volunteer for the failure to process or for delay in processing such applications that resulted from or were due to that cessation of processing. 10. Attorneys' Fees.If any legal action is brought by either party to interpret or enforce any terms or provisions of this Agreement.the prevailing party shall be entitled to its reasonable attorneys' fees and costs. 11. Entire Agreement.This Agreement constitutes the entire agreement of the parties with respect to the matters set forth herein. Any amendments,modifications, or changes to this Agreement shall be in writing and signed by both parties. 12. Waivers.Waiver of a breach or default under this Agreement shall not constitute a continuing waiver or a waiver of a subsequent breach of the same or any other provision of this Agreement. 13. Severability.If any provision of this Agreement or the application of any such provision shall be held by a court of competent jurisdiction to be invalid,void or unenforceable to any extent,the remaining provisions of this Agreement and the application thereof shall remain in full force and effect and shall not be affected, impaired or invalidated. 14. CEQA Processing.Developer acknowledges and agrees that the City is the lead agency under CEQA,that the environmental review document(s), including but not limited to,an Initial Study, Environmental Impact Report(including project or program level review, supplemental EIR, subsequent EIR,or addendum),mitigated negative declaration,negative declaration,and/or notice of exemption,must reflect City's independent judgment and that City retains full discretion with respect to all findings to be made in connection therewith. 15. Successors and Assigns.This Agreement shall be binding upon the parties hereto and their respective heirs, legal representatives, successors and assigns. 16. Jurisdiction.This Agreement shall be administered and interpreted under the laws of the State of California without regard to its choice of law rules.Jurisdiction and venue of litigation arising from this Agreement shall be in the County of Riverside, State of California. 17. Notices.Notices required by this Agreement shall be personally delivered,mailed,postage prepaid, or mailed via nationally recognized overnight courier as follows: 5 To the Developer: William Messenger,Jr. NPH Estates,LLC Attention: William S.Messenger, Jr. 270 Newport Center Drive,Suite 100 Newport Beach,CA 92660 Email: Bill@Messengerco.com GHP Holdings,LLC Attention: William S. Messenger, Jr. 270 Newport Center Drive, Suite 100 Newport Beach, CA 92660 Email: Bill@Messengerco.com Section 13 Trust Attention: Marco Rossetti 622 N. Palm Canyon Palm Springs,CA 92262 Email: MaTcoAosetii Cbre.com To the City: Charles McClendon, City Manager 68-700 Avenida Lalo Guerrero Cathedral City,CA 92234 with a copy to: Tracey R.Hermosillo,City Clerk 68-700 Avenida Lalo Guerrero Cathedral City, CA 9223 Notices given by personal delivery shall be deemed received and effective immediately.Notices given by overnight courier shall be deemed received and effective upon the date of delivery. Notices given by mail shall be deemed to have been received five days after having been deposited in the United States mail. Any party may change its address for notice by written notice to the other party in the manner provided in this paragraph 17. 18. Interpretation. The titles to the sections of this Agreement are not a part of this Agreement and shall have no effect upon the construction or interpretation of any part of this Agreement. As used in this Agreement, masculine, feminine or neuter gender and the singular or plural number shall each be deemed to include the others where and when the context so dictates. The word "including" shall be construed as if followed by the words "without limitation." This Agreement is the product of negotiations among the parties, and it shall not be construed as if it had been prepared by one of the parties,but rather as if all of the parties have prepared the same.Any rule of construction to the effect that ambiguities are to be resolved against the drafting party shall not apply in interpreting this Agreement. 6 19. Authority. Each person executing this Agreement covenants and warrants that (i) the party on whose behalf he or she is signing is duly incorporated or otherwise established or formed and validly existing under the laws of its state of incorporation, establishment or formation, (ii) the party has and is duly qualified to do business in California, (iii) the party has full corporate, partnership, trust, association or other power and authority to enter into this Agreement and to perform all of its obligations hereunder,and (iv)each person(and all of the persons if more than one signs)signing this Agreement is duly and validly authorized to do so. 20. Counterparts.This Agreement may be executed in counterparts. 21.Assignment of Claims. To the extent City determines that it may have Claims against any Project Consultant in connection with the Proposed Project, City may, upon written request by Developer, assign such Claims to Developer. As used herein, "Project Consultant" means any consultant, contractor, or other third party whose work product gives rise to any Eligible Cost or who is hired by City in connection with the Project Approvals; and "Claims" means any and all claims, potential claims, causes of action, and potential causes of action for breach of contract and/or professional negligence,regardless of whether such claims or causes of action accrue prior to or after the effective date of this Agreement. 22. Electronic Signature. The Parties agree that,in accordance with the City's Electronic Signature Use Policy, adopted on August 10, 2023, and as amended thereafter, the Parties may use electronic signatures to execute this Agreement.Any use of electronic signatures to execute this Agreement shall comply with the City's Electronic Signature Use Policy,and such signatures shall have the same force and effect as if this Agreement were executed by hand. Contractor acknowledges that it has had an opportunity to request and review the City's Electronic Signature Use Policy, and Contractor agrees to comply with the Electronic Signature Use Policy. Contractor agrees to indemnify,defend,and hold the City harmless from any claim, damage, or liability associated with transmitting an electronic signature or an electronically signed record by electronic transmission. [REMAINDER OF PAGE LEFT INTENTIONALLY BLANK] 7 IN WITNESS WHEREOF,the parties hereto have executed this Agreement as of the date first above written. CITY: CITY OF CATHED' L CITY, a municipal corporation _. Ltc.Erctr;r1 lhh r t=.24\ 7 7 7 Charles P.McClendon,City Manager APPROVED AS TO FORM: Eric S.Vail,City Attorney ATTEST: T.rae R �Y�t?osillo w 'I"ru 1 f'.C-fri`rrtr iIl (MI.2 4 7 1 tB 1,,1 Tracey R.Hermosillo,City Clerk DEVELOPER: NPH Estates,LLC, a California Limited Liability Company B. •. l tlirvvr S Mc nr,Jr(Mar.,7G:i c4 4.9 P;Tj (Signature) (Date) William S.Messenger,Jr.,Managing Member 8 GHP Holdings,LLC, a Delaware Limited Liability Company By: SV Ranch,LLC, a California Limited Liability Company,Member 1411Vani . e en e? (Signature) (Date) William S.Messenger,Jr.,Its Manager Section 13 Trust • 13\ m - (Signature) (Date) Marco Rossetti, as Appointed Successor Trustee of the Section 13 Trust,Dated June 14, 1988 9 ATTACHMENT A PROPERTY DESCRIPTION OF SPECIFIC PLAN AREA w, ' t ait>- 4141, �2' w„`' .„ ,,,sti? 'ta „ .` ti $x{ '?a `„y , a, m , 2 r1. 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(ct,t4„kN.�>4'r,` `,rt,,z''t ,t +,,r,,ri s,,.ti. •d" �s „, l N �r ttsaa .6' ,< „u,o,� ATTACHMENT B GOOD FAITH ESTIMATE OF PROJECT EXPENSES Planning and Environmental Consultant Services $346,190.00 ost ecove elm ursement Agreement Final Audit Report 2024-03-07 Created: 2024-03-06 By: Tracey R.Hermosillo(themnosillo@cathedraicity.gov) Status: Signed Transaction ID: CBJCHBCAABAAF-UpRNzjHlOkroMzkBthDpiAEjg2ekER "Cost Recovery Reimbursement Agreement" History Document created by Tracey Hermosillo(thermosillo@cathedralcity.gov) 2024-03-06-10:37:22 PM GMT Document emailed to bill@messengerco.com for signature 2024-03-06-10:40:30 PM GMT Email viewed by bill@messengerco.com 2024-03-06-10:45:26 PM GMT k,co Signer bill@messengerco.com entered name at signing as William S. Messenger, Jr. 2024-03-06-10:49:33 PM GMT AS) Document e-signed by William S. Messenger, Jr. (bill@messengerco.com) Signature Date:2024-03-06-10:49:35 PM GMT-Time Source:server Document emailed to marco.rossetti@cbre.com for signature 2024-03-06-10:49:36 PM GMT Email viewed by marco.rossetti@cbre.com 2024-03-07-6:10:41 PM GMT AN Signer marco.rossetti@cbre.com entered name at signing as Marco Rossetti 2024-03-07-7:38:36 PM GMT Document e-signed by Marco Rossetti (marco.rossetti@cbre.com) Signature Date:2024-03-07-7:38:38 PM GMT-Time Source:server L Document emailed to Charles McClendon (cmcclendon@cathedralcity.gov)for signature 2024-03-07-7:38:39 PM GMT Email viewed by Charles McClendon (cmcclendon@cathedralcity.gov) 2024-03-07-7:42:15 PM GMT Powered by Adobe Cathedral City Acrobat Sign &'fit.4 Document e-signed by Charles McClendon (cmcclendon@cathedralcity.gov) Signature Date:2024-03-07-7:42:33 PM GMT-Time Source:server Document emailed to evail@bwslaw.com for signature 2024-03-07-7:42:34 PM GMT Email viewed by evail@bwslaw.com 2024-03-07-7:49:27 PM GMT Signer evail@bwslaw.com entered name at signing as Eric S Vail 2024-03-07-10:57:25 PM GMT vb. Document e-signed by Eric S Vail (eyail@bwslaw.com) Signature Date:2024-03-07-10:57:27 PM GMT-Time Source:server Document emailed to Tracey Hermosillo (thermosillo@cathedralcity.gov)for signature 2024-03-07-10:57:28 PM GMT Email viewed by Tracey Hermosillo(thermosillo@cathedralcity.goy) 2024-03-07-11:08:27 PM GMT Ja4 Signer Tracey Hermosillo(thermosillo@cathedralcity.gov)entered name at signing as Tracey R.Hermosillo 2024-03-07-11:09:39 PM GMT Document a-signed by Tracey R.Hermosillo(thermosillo©cathedralcity.gov) Signature Date:2024-03-07-11:09:41 PM GMT-Time Source:server ke Agreement completed. 2024-03-07-11:09:41 PM GMT 111111111 bY Adobe C4thedrxtCy Acrobat Sign