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HomeMy WebLinkAboutContracts & Agreements_101-2016 EXCLUSIVE NEGOTIATING AGREEMENT BETWEEN THE CITY OF RE,DLANDS AND VANTAGEONE REAL_ESTATE INVESTMENTS, LLC This EXCLUSIVE NEGOTIATING AGREEMENT (this "Agreement") is dated May 18, 2016, and is entered into by and between the City of Redlands, a California municipal corporation (the "City"), and VantageOne Real Estate Investments, LLC, a California Limited Liability Company (the "Buyer"). The City and the Buyer are sometimes individually referred to herein as a"Party" and, together, as the "Parties." RECITALS A. The City is in the process of negotiating a potential purchase of the land in the City depicted in Attachment No. 1 (the"Site") from the county of San Bernardino (the"County"). The Buyer has expressed to the City a request to purchase the Site from the City, should the City acquire the Site for commercial/retail development on the Site (the "Project"). B. After considering the Buyer's request, the City's City Council has instructed its staff to prepare this Agreement with the Buyer to negotiate on an exclusive basis to establish the terms and conditions of a purchase and sale agreement between the City and the Buyer for the sale of the Site from the City to the Buyer should the City acquire the Site from the County, and one or more agreements and related documents(collectively,the"Project Agreements")that would result in the Buyer's purchase of the Site. C. The Buyer understands and acknowledges that the City is not obligated to acquire the Site if, in its sole discretion, the City Council determines that such an acquisition is not in the public interest, not permitted by law, not consistent with the City of Redlands General Plan, or for any other reason. Further, the Buyer understands and acknowledges that the Parties are not obligated to reach agreement on the terms of the Project Agreements. D. The Buyer and the City are willing to enter into this Agreement setting forth, among other things, the terms pursuant to which the City will negotiate with the Buyer on an exclusive basis for a limited period regarding the Project Agreements and Project. E. The staff, consultants, and attorneys of the City will devote substantial time and effort in meeting with the County, the Buyer and its representatives, reviewing proposals, plans and reports, and negotiating and preparing the Project Agreements. NOW, THEREFORE, the Parties agree that the foregoing recitals are true and correct, and as follows: 1. The term of this Agreement shall commence on the date first written above and shall end on the earlier of. (i) twelve (12) months thereafter (subject to one (1) extension for up to six (6) calendar months thereafter by written agreement of the City's City Manager, acting on behalf of the City; (ii) the date on which the City and the Buyer terminate this Agreement as provided in Section 2 below, (iii) the date on which the Buyer terminates this Agreement as provided in Section 3 below or (iv) the date the Buyer acquires the Site (the "ENA Period"). Additionally,this Agreement is contingent on the Buyer completing the purchase of 212 Brookside Avenue from the City. 2. Subject to Buyer's notice and cure rights hereinafter set forth, the City may terminate this Agreement if the Buyer fails to comply with or perform any provision of this Agreement. The City shall provide written notice to the Buyer which specifies the failure of the Buyer to perform and the steps necessary for the Buyer to cure such failure. The City shall not terminate this Agreement if the Buyer cures the deficiencies specified by the City within ten (10) business days after such notice is given, if the deficiency is not commercially reasonable to be cured within ten(10)business days and the Buyer has commenced curing and is diligently working towards curing the time period shall be extended to allow the deficiency to be cured; however, in no event shall such cure period extend beyond the expiration of the ENA Period. 3. The Buyer may terminate this Agreement at any time, in its sole discretion, by providing not less than fourteen (14) calendar days advance written notice to the City. In the event of such a termination,Buyer shall be responsible for all costs incurred by of the City, subject to Section 7 of this Agreement, prior to the date the City receives Buyer's written notice of termination. This provision shall survive any termination of this Agreement. 4. During the ENA Period: (i) the City shall not negotiate with any person or entity other than the County and the Buyer for the sale, acquisition, lease or development of the Site (except for short term uses that will not interfere with the Project); (ii) the Buyer, shall not negotiate with any person or entity other than the authorized representative of the City for the purchase, lease or sublease of Site from the City; and (iii) both the City and the Buyer shall cooperate in the City's negotiation of purchase terms and price for the Site with the County. During the ENA period, the City and the Buyer shall work cooperatively to negotiate a purchase and sale agreement and the Project Agreements. 5. Throughout the ENA period, the City shall supply to the Buyer periodic updates regarding its progress in acquiring the Site from the County. Throughout the ENA Period, the Buyer and the City shall use good faith efforts to make its staff reasonably available to meet to discuss the Project and the Project Agreements. 6. During the ENA Period, the City shall use good faith and commercially reasonable efforts to negotiate with the County for the purchase of the Site at a price agreeable to the City, the County and the Buyer based on at least one (1) timely MAI appraisal of the Site from a mutually agreed MAI Appraiser. Upon execution of this ENA, the City shall disclose to the Buyer the contents of the most recent existing MAI appraisal (if available) of the Site and the purchase price proposed by the County for the Site, if such a proposed price has been made known to the City. It is the intent of the Parties that if the City agrees to purchase the Site from the County, the Buyer shall immediately thereafter purchase the Site from the City at exactly the City's full and complete cost, defined to include the purchase price the City paid the County plus the City's actual legal fees, consultants' fees, appraisal, title and closing costs incurred in selling the Site to Buyer. It is finther the intent of the Parties that the City shall deliver the Site to the Buyer, if at all, in an "as-is" condition, with no representation to the Buyer as to the environmental status of the site or its fitness for development. However,the Parties anticipate that the Project Agreements will give Buyer a reasonable due diligence opportunity to inspect the Site and related matters to ensure the Buyer can develop and use the Site for its intended purpose, including whether it contains any hazardous materials or other impediments to development and use. The City shall not be obligated to offer to purchase or purchase the site from County unless and until the City and the Buyer shall have first executed a mutually agreeable purchase and sale agreement and the Buyer has deposited in escrow an amount equal to the agreed upon purchase price plus any additional costs of acquisition incurred by the City. 7. As an accommodation to the Buyer, and at the Buyer's specific request, the City shall expedite its envirom-nental and planning review of the Project on a schedule to be negotiated between the Parties. In addition to the City's costs of acquisition and the purchase price for the Site, if any, as set forth in Section 6 above, the Buyer shall reimburse the City for its actual out-of-pocket costs and expenses (including legal fees and costs and consultants' fees and costs) incurred in negotiating and preparing the Project Agreements, conducting the planning and environmental review of the Project and fulfilling its obligations under this Agreement, including, but not limited to: (i) actual City fees and charges in effect as of the date the Buyer applies for Project land use approvals, (ii) the City's actual cost of negotiating, and preparing the Project Agreement and related documents; and (iii) the City's usual processing fees for reviewing applications, reports and plans relating to the Project (collectively, the "Reimbursable Costs"). Within two (2) business days after the City approves and executes this Agreement and delivers a copy to the Buyer, the Buyer shall deposit with the City the sum of twenty thousand dollars ($20,000) (the "Reimbursement Funds"). The Reimbursement Funds shall be used and applied from time to time by the City to pay itself for the Reimbursable Costs. The City shall provide the Buyer with an accounting of the City's use of any of the Reimbursement Funds within a reasonable time after the end of each calendar quarter during the term of this Agreement. The Reimbursement Funds are processing fees and therefore the City shall account and be responsible for them pursuant to the California Government Code. The Buyer shall further deposit with the City monies sufficient to cover additional Reimbursable Costs within ten (10) business days after receipt of written notice from the City that the Reimbursable Costs are expected to exceed the sum of the deposited Reimbursement Funds. If the Buyer fails to timely deposit additional Reimbursement Funds following notice from the City (without terminating this Agreement pursuant to Section 3), the City may, at its discretion, stop work under this Section until such deposit is made, as well as pursue any available remedy at law or equity. The Parties intend that the Buyer shall fully fund the Reimbursable Costs. Any remaining amount of the Reimbursement Funds shall be delivered to the Buyer (along with a final accounting of the City's use of the Reimbursement Funds) within thirty(3 0) business days after the earlier of: (i) the execution of the Project Agreements, or(ii) the termination of this Agreement. 8. The Buyer shall also bear its own costs and expenses of any and all title, appraisal, environmental, physical, engineering, financial, and feasibility investigations, reports and analyses and other analyses or activities it or its consultants perform for the Project. 9. The Buyer and the City understand and agree that no Party is under any obligation whatsoever to enter into the Project Agreements. Additionally,the Buyer acknowledges that the City must in good faith review and consider any environmental impacts of the Project before deciding whether to approve the Project and the Project Agreements. In the event of the expiration or earlier termination of this Agreement, the City shall be free at the City's option to negotiate with any persons or entities with respect to the sale,lease and/or development of the Site. 10. This Agreement may not be assigned by the Buyer without the prior express written consent of the City in its sole and absolute discretion. In the event of any such assignment without such prior written consent, this Agreement shall immediately terminate. 11. Any notice, request, approval or other communication to be provided by one Party to the other shall be in writing and provided by personal service or a reputable overnight delivery service (such as Federal Express) and addressed as follows: If to the Buyer: Vanta.gcOne Real Estate Investments, LLC 4 Corporate Plaza Drive, Suite 210 Newport Beach, CA 92660 Attention: Thomas, N. Robinson Telephone: (949) 631-6620 Email: tnulif,PaoLcoin If to the City: City of Redlands P.O. Box 3005 Redlands, CA 92373 Attention: City Clerk Telephone: (909) 798-7531 Email: With a copy to: City Attorney City of Redlands Attention: Daniel J. McHugh Telephone: (909) 798-7595 Email: chachuo�i@cir ............. 11 For purposes of the negotiations contemplated by this Agreement, the Buyer's representative shall be Thomas Robinson and the City's representative shall be the City Manager or the City Manager's designee. 13. This Agreement constitutes the entire agreement of the Pat-ties with respect to the subject matter hereof. There are no other agreements or understandings between the Parties with respect to the subject inatter hereof or any related subject and no representations by either Party to the other have been made as an inducement to enter into this Agreement. All prior negotiations between the Parties are superseded by this Agreement. 14. This Agreement may not be altered, amended or modified except by a writing executed by the Parties. 15. If any Party should bring any legal action or proceeding relating to this Agreement or to enforce any provision hereof, or if the Parties agree to arbitration or mediation relating to this Agreement, the Party in whose favor a judg.rnent or decision is rendered shall be entitled to recover reasonable attorneys' fees, costs and out-of-pocket expenses (including but not limited to the fees and costs of experts) from the other. The Parties agree that any legal action or limited to the fees and costs of experts) from the other. The Parties agree that any legal action or proceeding or agreed-upon arbitration or mediation shall be filed in, and shall occur in,the county of San Bernardino. 16. The interpretation and enforcement of this Agreement shall be governed by the laws of the State of California, as if this Agreement was jointly drafted by the Parties. 17. Time is of the essence with regard to each and every provision of this Agreement, 18. This Agreement may be executed in counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same Agreement. 19. The Buyer shall execute this Agreement first and shall then deliver this partially executed Agreement to the City for approval and execution by the City. The Buyer acknowledges and agrees that the City is under no obligation to consider or approve this Agreement until it has been executed by the Buyer. IN WITNESS WHEREOF, the Parties have executed this Agreement as of the day and year first written above. [SIGNATURES ON FOLLOWING PAGE] BUYER: Vanta eOne Real Estate Investments, LLC By: "p/. Name: _ Al. odtL � Title: MA 9A(,,lovb 'I CA CITY: Paul W. Foster, Mayor ATTEST: Sam -Irwin, City Clerk ATTACHMENT NO. I LEGAL DESCRIPTION OF SITE (TO BE PROVIDED BY TITLE COMPANY) ATTACHMENT NO. 1 LEGAL DESCRIPTION OF SITE (TO BE PROVIDED) That certain real property located at 216 Brookside Avenue, Redlands, County of San Bernardino, California,known as APN Numbers: 171-211-13-0000, 171-211-14-0000, 171-211-16-0000, 171- 211-18-0000, 171-211-19-0000, 171-211-20-0000 and 171-211-21-0000 RECEIVED 1 N (1 Ali 2016 One REAL P,,YM E �'�'J V L S I M E N I S REEH.ANDS C�I'Y CLA-FW June 9, 2016 VIA: Personal Delivery City of Redlands Attention: City Clerk 35 Cajon Street, Suite 4 Redlands, CA 92373 RE: REIMBURSEMENT FUNDS EXCLUSIVE NEGOTIATING AGREEMENT—216 BROOKSIDE AVENUE REDLANDS, CA Dear Oscar: Per Section 7 of the Exclusive Negotiating Agreement dated May 13th 201'6, enclosed Meese find a check in the amount of $20,000.00 for the Reimbursement Funds. Please contact me if you have any questions. Sincerely, VantageOne Real Estate Investment, LL.0 Thomas N. Robinson Managing Manager 'I Ca�poi cfle�Iu7c) �)I �')W to 2 K) NrewpW �3(,,och, CA 92660 p 949 63 1 6620 WELLS F'ARGO BANK,N.A. �1 064 INVEST >EN"t"iSm LLC i(3.2 1220 1 C;earpo�ralr PlanDr �tc 210 Ncwt°Cor� Beach,CCA 92660-�7`906 6/212016 w wo PAY TO TGIF City of Redlands � **20,000.00 OR!DER Twenty Thousand and 00/100 _ _ _._ _ DOLLARS City of Redlands i MEMO mm 0 00 06i 0 ' 2100 ?e S ° um CITY OF i DLANDS %1 m i" ' 'n 't Transmittal Form Deposi CRATE. 7/5/2016 REC #: L/_2:") TO: FINANCE DEPT/REVENUE DIV 15B CASH: $ FROM: � � CHECKS: $ 20,000,00 (DEPARTMENT) WIRE/EFT: CC: { DEV SVCS CCLERK 'CHARGE CARDS: $ _. REV TOfA_ DEPOSIT $ 20,000.00 Please deposit funds, and distribute as indicated betow: ACCOUNT DESCRIPTION QUICK CODE ORO KEY- BJECT'I JOB LEDGER (JQ AMOUNT MIS BLI..AN OUS RECEIPTS 529 101,164.3530 1504 $ 20,000.00 TOTAL DEPOSIT $ 20,Oao.O� DETAIL. 216 BROOKSIDE AVE REIMB FUNDS, AGREEMENT 5/18/16 SECTION 7 N olr UP,,. 'ty F114 Ir 11 mr l PREPARED BY: KAKI 'A. GR �tC ;REV MGR n APPROVED BY: (AUTHORIZED DEPARTMENT SIGNATURE) t~ N:1treaSUry'1FORMS\CA;SH FORMS\Deposit Transmittal Farm Blank.xls