HomeMy WebLinkAboutContracts & Agreements_143-2003_CCv0001.pdf AGREEMENT FOR AUTO MALL
CONSULTING SERVICES
This Agreement is made this 15thday of July, 2003, by and among Direct Point Advisors Inc.
("DPA"), the City of Redlands Abm "City) and Security Trust Company as Trustee of its Trust No. 007386
(the "Property Owner") (the latter two together are referred to as the "Clients") for the provision of
consulting services to the Clients in connection with the development of a proposed approximately 25
acre Auto Mail site.
1' UNDERSTANDING OF THE ASSIGNMENT:
|. Q|enbm desire that DPA act as the Clients' team nnernber//|a|mon/egentvviUl the Qb/s elected officials
and staff, the Property Dwner, with all of the New Vehicle Sales Dealership owners/operators in the
City and potential New Franchises for the Clients' proposed Auto k8a|/ concept. DPA understands that
these dealerships will be New Points` Open Points and/or relocations of existing dealerships that do
not cross any municipal boundaries.
2. Clients desire DPA to explore with them possible financial incentives for the relocation ofNewVoh/de
Sales Dealership owners/operators toan Auto Mall site within the City.
3. Clients desire DPA to assist City officials and the Property Owner to open a dialogue with the New
Vehicle Sales Dealership owners/operators for the Auto K4a|/ concept.
4. Clients will provide DPA with any and all existing factual and marketing materials needed tofacilitate
the meetings and / or correspondences with the New Vehicles Sales Dealership owners/operators
and potential New Franchises.
5. DPA will be the direct point of contact with the Clients and New Vehicle Se/ao dealership owners /
operators in presenting the Auto K4aU concept. |fNew Vehicle Sales manufacturers are to be included
in conversations, DPA shall betheir direct point contact auwell.
6. On the date of this Agreement, the New Vehicles Sales Dealership entities to be included (but not
limited to) in this project are the following: Metro Nissan & Hyundai; -from Bell Chevrolet,- Redlands
Ford; Tom Bell Toyota; Hatfield Buick/GMC TrucK� Redlands Auto Center Lincoln/Mercury/K4azda,,
Redlands Chrysler/Dodge Trucks.
T Clients have been advised by DPA of the issues that presently exist with regard to the laws governing
municipalities relating to tax incentives and property write-downs. AB 178 is very active in the
California State Legislature and the main focus of that legislation is to put o mhmp to automotive
dealerships jumping city bunjona because of the lure of attractive tax incentives and property write-
downs, Clients have advised DPA that these dealerships will not be re|ocadono outside the City's
borders.
8, Clients have been briefed on California's "prevailing vvagm^ requirements if any City financial
assistance is given either directly or indirectly to the project; plus, the latest"threat"of SB 114.
H. SCOPE OF SERVICES
DPA shall perform the following tasks:
BASIC SERVICES
Task |: DPA shall tour the existing New Vehicle Sales Dealership edeo and shall review the proposed
Auto Mall site with the Clients' representatives and staff.
Task 2: DPA shall immediately commence attending meetings with the management of the Property
Owner and City officials. DPA shall gather New Vehicle Sales Dealership financial data from the City. This
input is critical in the formulation of the site size and dealership configuration. The Clients and DPA shall
also gather materials to assemble a packet to present to the leadership of Property Owner on the
proposed Auto PWaU site. No materials will be released by DPA without the Clients' approvals. DPA shall
immediately serve as the first line of communications for the Clients in all New Vehicle Sales Dealership
owneraYomenabona`and manufacturers' issues and concerns.
Task 3: On or before October 1. 2003. [)PA shall set up meetings with the New Vehicle Sales
Dealerships owners/operators to present the Clients' Auto K8a|| concept to them. DPA will pursue and
attend any and all follow-up meetings as well. DPA shall oeuimt in the site conceptual formation and
development alignments with the dealerships. DPA shall also assist the Clients regarding site acquisitions
ifmore land isneeded tosecure all ofthe franchises inaclustered site than the land presently controlled
by the Property Owner.
Task 4: DPA shall maintain an open line of communications with the Clients' officials and management
and New Vehicle 8e|em Dealerships entities regarding the status of the project and interest with those
officials on the Clients' behalf, and shall publish a schedule of activities for the project and deliver that
schedule to the Clients on the 1 st and 15m 0fevery month. DPA shall meet with the Clients no |emo than
two drnem each month regarding certain financial related issues and assist in clearing the way to bring
financial assistance to the Dealership owners/operators and/or Auto K4oU site.
Task 5: []PA shall work closely with the Clients and with the New Vehicles Sales Deo/enGb|p owners/
operators/manufacturers. This task includes the preliminary development of innovative concepts and
strategies to attract additional financial assistance and/or incentives directly benefiting the Clients in their
Auto Mall location pursuit.
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Task 6: DPA shall work closely with the Clients in developing agreements with New Vehicle Sales
Dealership and/or manufacturers.
Task 7: DPA shall work closely with the Clients to anter into an Exclusive Negotiation Agreement /ENA\,
if that mechanism is advisable for these transactions. DPA shall assist in the negotiations, with the
Clients' approved deal pointe, for o Disposition and Development Agreement(s) to memorialize the
incentive pookaoe(a), ifneeded.
ADDITIONAL SERVICES.
Any services and or tasks not listed above in Tasks 1-7 will be negotiated separately and distinctly at a
fee to be agreed upon only if and when the Clients desire to utilize thern. Theme services might include
specific opinions from legal experts in municipal law and / orautomobile manufacturer representation
fields, and Auto Mall designers,
XUy. COMPENSATION
1. [}PA!mcompensation for the Basic Services, Tasks 1-7. shall bafour thousand dollars ($48OU.00
US} each month during the term of this Agreement. payment of DPA'm compensation for the Basic
Services, Tasks 1-7, shall be the sole responsibility and obligation of the Property Owner, and the City
shall have noliability therefor.
2. DPA shall receive a success bonus for each New Vehicle Franchise* ("seeAttachment ^A") that
is relocated or located to the Auto KYaU site, and to any extensions of the Auto K4aU site. Each success
bonus shall be in the amount of Twenty Thousand Dollars ($20.000.00 US) per franchise. The success
bonus shall be due and payable when binding agreements have been entered into and executed by the
dealership mrditiao and/u/, the Property Ovvner, and/or the City or its Redevelopment Aoency, for
construction and operation of an Auto Mall. The City will pay any and all success bonuses to [}PA, and
the Property Owner shall have nuliability therefor, Regardless ofthe number mfNew Vehicle Franchises
relocated or located to the Auto K4aU site. the City shall have no obligation to pay DPA success bonuses
which, in the aggregate, exceed the sum of One Hundred Sixty Thousand Dollars ($160,000.00 US).
3. The Property Owner shaft be solely responsible for payment of DPA's out ofpocket expenses,
costs, and extraordinary additional cosim, which in total shall not exceed the ounl of Five Thousand
[)mUany ($5,000 US) without priorwr(tten approval of the Property Owner; and the City shall have no
obligation orliability therefor. All additional expenses and/or costs shall bebilled b} the Property Owner,
with no additional mark-up. Any and all extraordinary additional costs (any expenses over$25O) shall be
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pre-approved bvthe Property Owner and shall bebilled hothe Property owner.
IV. OTHER PROVISIONS
A. Termination. Each party shall have the rightbnbenninahaUhis4onaenlentatanyUrneupon
forty-eight (48) hours prior written notification tothe other parties. Payment for fees and
anticipated success bonuses accrued through the date of termination shall be remitted in
full. Upon receipt of g termination notice from the City. []FA ahoU (1) promptly
discontinue all services, and (2)deliver or otherwise make available to the Clients, copies
(in both hand copy and electronic h}nn, where applicable) of any data, demign,
co/ou|aUonn, dn*vvings, specifications, naporta, embrnatee, surnnnahmm and such other
information and materials that have been accumulated or prepared by DPA in performing
its services,
B. Attorneys' Fees. /nthe event of any legal action orproceeding boconstrue orenforce the
terms of this Agreement or any agreement ordocument entered into pursuant to this
Agreement, the party prevailing in such action or proceeding aheU be entitled to recover
actual attorneys'fees, expenses and cost to be fixed by the court and taxed as part of the
judgment therein, as well as all actual attorneys' fees, expenses and cost incurred in
enforcing any such judgment.
C. Authority. Each of the parties executing this Agreement warrants that this Agreement is
executed bypersons duly authorized hubind each such party boits terms.
D. Further Actions. The parties agree to execute such additional documents and take such
further actions as may be necessary to carry out the provisions and intent of this
Agreement.
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E' Assignment. Neither this Agreement nor any of the rights or obligations hereunder may
be assigned by any party without the prior written consent of the other parties.
F. Successors and Assigns. This Agreement shall bebinding upon and inure tothe benefit
ofthe parties hereto and their respective successors and assigns.
G. Entire Agreement; Amendments and Waivers. This Aonaernmnt contains the entire
agreement among the parties relating tothe transactions contemplated hereby and any
and all prior discussions, negotiations, commitments and understanding, whether written
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ororal, related hereto are superseded hereby. Noaddition ormodification ofany term or
provision of this Agreement shall be effective unless set forth in writing signed by all
parties. No waiver of any of the provisions of this Agreement ahcd| be deemed to
constitute a waiver ofany other provision hereof (whether or not similar), nor nhoU such
waiver constitute a continuing waiver of such provisions unless otherwise expressly
provided.
H. Cumulative Remedies, All right and remedies of either party hereto are cumulative of
each other and of every other right or remedy such party may otherwise have at law or in
equity, and the exercise of one or more rights or remedies aheU not prejudice or impair
the concurrent orsubsequent exercise ofother rights orremedies.
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Severability. /f any term or provision of this Agreement uhoU be deemed invalid or
unenfonooab/e, the remainder ofthis Agreement shall not be affected thereby, and each
remaining term and provision of this Agreement shall be valid and in force to the fullest
extent permitted bylaw,
J. Time of Essence. Time is of the essence to each party and every provision of the
Agreement.
K. Notices. All noUoes, requeats, demands and other communications which may be
required under this Agreement shall be in writing and shall be deemed to have been
received when transmitted, if personally de(ivered, if transmitted byba/eoopier, electronic
or digital transmission nnethod, upon transmission; if sent by next day delivery to a
domestic address by a recognized overnight delivery service (e.g., Federal Express), the
day after it is sent; and if sent by certified or registered rnaU, return receipt naqueated,
upon receipt. In each case, notice shall be sent to the principal place of business of the
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respective party. Any party may change its address bygiving written notice thereof tothe
other inaccordance with the provisions ofthis paragraph.
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Titles and Captions. Titles and captions contained in this Agreement are inserted only as
omatter ofconvenience and for reference and innoway define, limit, extend ordescribe
the scope ofthis Agreement orthe intent ofany provision herein.
M. Governing Lew. The statutory, administrative and judicial |avv of the State of California
(without reference to choice of law provisions of California law)shall govern the execution
and performance mfthis Agreement.
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N. Counterparts. This Agreementmay be executed in one ormore counterparts, each of
which constitutes an original, and all of which together constitute one and the same
hlstnurnanL The signature mfanypensononahm|ecopyofMhisAoraomanLoranynodce,
action or consent taken pursuant to this Aonsennont, shall have the same full force and
effect as such person's original signature.
O. Consent toElectronic Communications.
In order to maximize efficiency in this trenaaotion. DPA intends to use state of the art
communications devices to the fullest extent possible. E-mail, computer document
attachments and tnansh*ra, cellular telephones, and facsimile transfers will be among
such communication devices. The use of such devices under current technology may
place your confidences and privileges at risk. Hovvever. DPA believes the effectiveness
involved in use of these devices outweighs the risk of accidental disclosure. By signing
this letter, you acknowledge your consent tothe use cfthese devices.
P. Ownership of Documents. All documents, n*cords, dnaxvings, deoigno, cost ootirnates,
electronic data files, databases and other documents developed byDPA pursuant bothis
Agreement shall become the property of the City and shall be delivered to the City upon
completion of Op/Ye sen//cea, or upon the request of the City. Any reuse of such
documents and any use of incomplete documents will be at the City's sole risk.
Q. Independent Contractor Status. DPA is for all purposes anindependent contractor. DPA
ahoU supply all tools and instrumentalities required to perform its services and all
personnel employed byDPA are for its account only. In no event shall DPA orany
personnel retained by it be deemed to have been employed by the Clients or engaged by
the Clients for the account of, oronbehalf of, the Clients.
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R. Defense and Indemnity.
1. DPA shall deh*nd, indemnify and hold harmless the Clients and their
respective elected officials, officers, employees and agents from and against
any and all actions, damages, losses, causes of action and liability imposed
or claimed relating to the injury or deoth of any person or damage to any
proporty, including attorneys' fees and other legal expenoao, arising directly
or |nd|manOy from any negligent or wrongful act or omission of DPA in
performing its consulting services.
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2. The City shall defend, indemnify and hod harmless DPA and the Property
Owner and their officers, employees and agents from and against any and
all actions, damages, |oases, causes of action and liability imposed or
doinnod na/ednQ to the injury or death of any person or damage to any
pnoparty, including attorneys' fees and other legal expenses, arising directly
or indirectly from any negligent or wrongful act or omission of the City in
performing its obligations under this Agreement.
3. The Property Owner shall defand, indemnify and hold hamn|asa DPA and the
City and their respective elected ofhdals, nMicero, employees and agents
from and against any and all actions, damages, losses, causes ofaction and
liability imposed or claimed relating to the injury or death of any person or
damage to any property, including attorneys' fees and other legal expenaes,
arising directly or indirectly from any negligent or wrongful act oromission of
the Property Owner inperforming its obligations under this Agreement.
DIRECT PO. T ADVISORS, INC.
Mich _l R. 1 astings, Principal Date
PROPERTY OWNER
�n
oskl, Member Date
THE CITY OF REDLANDS
Ju1y, 15 t 20{}3
Karl N. Haws, Mayor Date
ATTEST:
City, Jerk, Lord er
DPAredlandsAGR0701 0
ATTACHMENT "A"
"NEW VEHICLE FRANCHISE"
General Definitions and Specific Delineation Samples (a partial list)
Chevrolet ... one franchise
Ford ...one franchise
Dodge/ Dodge Trucks ... one franchise
Lincoln-Mercury ... one franchise
Toyota ... one franchise
Lexus ... one franchise
BMW ... one franchise
Porsche ... one franchise
Acura ... one franchise
Nissan ... one franchise
Infiniti ... one franchise
Hyundai ... one franchise
Chrysler-Jeep ... one franchise
Buick/GMC Truck ... one franchise
Suzuki ... one franchise
Honda .. one franchise
Cadillac ... one franchise
Isuzu ... one franchise
Mitsubishi ... one franchise
Volkswagen ... one franchise
Daewoo ... one franchise
Land Rover ... one franchise
Mazda ... one franchise
Pontiac ... one franchise
Kia ... one franchise
Volvo ... one franchise
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Auto Mall - City Manager Davidson reported the subject of developing an auto
mall in the City of Redlands was before the Redevelopment Agency of the City
of Redlands at their meeting of July 1, 2003. At that meeting, Michael Hastings
of Direct Point Advisors, Inc. provided an overview of his company, discussed
his proposed agreement, and answered a series of questions and/or concerns
associated with the auto mall project proposal. Following the presentation, the
Redevelopment Agency Board directed staff to continue discussion with Direct
Point Advisors and return with a final agreement for providing professional
consulting services in conjunction with developing an auto mall with the City of
Redlands. A revised agreement was provided earlier today for review. City
Manager Davidson further reported on July 9, 2003, that Mr. Hastings met with
Councilmember George, Executive Director of the Redlands Chamber of
Commerce Kathie Thurston, Economic Development Director Ralph Megna,
and City staff. After considerable discussion, both Ms. Thurston and Mr.
Megna expressed strong support for advancing the concept of an auto mall and
fully supported retaining the consulting services of Director Point Advisors for
this project. Economic Development Director Ralph Megna expressed his
support for this concept and reminded everyone we must be conscious of what
the City will back-fill on the potential vacant properties on Redlands Boulevard.
Steve Rojas, Redlands Ford, expressed some concerns and assured everyone the
dealerships will not disappear from Redlands if they did not get this. Mayor Pro
Tem Peppler urged staff and Direct Point Advisors to include all dealerships in
further discussion. Mr. Hastings was present at this meeting, to answer
questions and assured everyone this project cannot move forward without the
car dealers. Councilmember George moved to approve the agreement for auto
mall consulting services with Direct Point Advisors, Inc. and Security Trust
Company as Trustee its Trust No. 007366 for the purpose of providing
professional consulting services in conjunction with the possibility of
developing an auto mall within the City of Redlands. Motion seconded by
Councilmember Peppler and carried with Councilmember Gilbreath voting NO
as she felt this should be part of the Economic Development Director's
responsibilities, and that since the agreement was property specific, that we
should let the property owner proceed at his own cost. (Also see
Redevelopment Agency minutes for July 15, 2003.)
Resolution No. 6177 - Conflict of Interest Code - Councilmember George
moved to adopt Resolution No. 6177, a resolution of the City Council of the
City of Redlands adopting an amended Conflict of Interest Code pursuant to the
Political Reform Act of 1974. Motion, seconded by Councilmember Peppler and
carried unanimously. (Also see Redevelopment Agency minutes for July 15,
2003, for adoption of Resolution No. 360 amending the Redevelopment
Agency's Conflict of Interest Code).
Resolution No. 6184 - Redevelopment Plan Amendment - Councilmember
George, moved to adopt Resolution No. 6184, a resolution of the City Council
of the City of Redlands setting the date, time and location (September 16, 2003,
July 15,200
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