HomeMy WebLinkAboutCARIBOU INDUSTRIES INC.A-2018.248
INSURANCE NO'I'RR)UIRFD
WOW M" PROCEFD
CLLHIKOFCOUNCIL EXHIBIT 1
T" OCT 1 2019
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t,k,rtf, tA00 ° REIMBURSEMENT AND INDEMNIFICATION AGREEMENT
BETWEEN THE CITY OF SANTA ANA AND CARIBOU
INDUSTRIES FOR THE PAYMENT OF FEES AND COSTS
RELATED TO CONTRACT ENVIRONMENTAL, LEGAL
AND ENGINEERING SERVICES FOR THE 31d AND
BROADWAY DEVELOPMENT AT 201 W. THIRD STREET
IN SANTA ANA RELATED TO ENVIRONMENTAL
DOCUMENTATION
This Agreement ("Agreement") is entered into as of September 4, 2018, by and
between the CITY OF SANTA ANA, a charter city and municipal corporation, organized
and existing under the Constitution and laws of the State of California ("City'), and
CARIBOU INDUSTRIES, INC, a Nevada corporation ('Developer"), who agree as follows:
1, Recitals, This Agreement is made with reference to the following facts and
circumstances:
A. The City and Developer entered into Agreement No. A-2017-058, dated
April 27, 2017, in order to provide a specified period of time to attempt to negotiate a
disposition and development agreement.
B. The City and Developer approved the first amendment to Agreement No.
A-2017-058, dated April 27, 2017, on July 5, 2017.
C. The City and Developer approved the Second Amended and Restated
Exclusive Negotiation Agreement No. A-2018-002, dated January 11, 2018.
D. Developer is seeking entitlement to certain real property consisting of a City
Owned 3 Level Parking Garage located at 201 W. Third Street, in the City of Santa Ana
("Property") (APN # 398-264-13).
E. Developer has filed applications to develop the Property with a residential
and commercial project, street improvements, and hotel (the "Project"), including
approximately 163 residential units, 76 hotel rooms, 14,321 square feet of commercial
space and 470 parking spaces (163 residential, 211 public spaces and 96 hotel stacker
spaces). The discretionary applications may consist of a General Plan Amendment
(GPA), Amendment Application (AA), Zoning Ordinance Amendment (ZOA), Variances,
Site Plan Review, Conditional Use Permit, and Vesting Tentative Map.
F. , City does not have personnel with sufficient expertise to prepare or review
the Environmental Document and related studies, reports and analyses for the project. In
order for City to process the Project, City is in need of contracting with an environmental
consultant. In addition to the environmental consultant, processing the Project will also
require work to be performed by the City Attorney's Office and the City Engineer. The
work to be performed by such persons and firms in processing the Project is collectively
referred to herein as the "Services."
G. City believes it is in the public interest for Developer to pay for such
Services.
H. Developer desires to move forward with the processing of its Project
subject to the reimbursement obligations set forth herein.
2. Agreement to Pay for Services.
Developer agrees to pay for all professional costs and expenses related to the
Services as provided for in this Agreement, even though the actual amounts may be
different than the proposal for the environmental consultant as listed in Section 3, and the
amount of costs for the City Attorney's Office and City Engineer have not been estimated.
City shall provide Developer with copies of monthly invoices.
3. Environmental Consultant, City Attorney, and Engineer Services.
A. For the purpose of conducting the environmental analysis, the
Environmental Consultant and their subcontractors will prepare technical analysis of: Air
Quality and Greenhouse Gas Emissions, Traffic Impact Analysis, Phase 1 Site
Assessment, Native American Coordination, Noise Study, and any other studies deemed
necessary by the Environmental Consultant to properly conduct the environmental
analysis.
B. For the purpose of conducting the environmental analysis, the Developer
has submitted a Conceptual Site Plan, Landscape Plan, Grading Plan, and Building
Elevations/Renderings, Preliminary Water Quality Management Plan and Hydrology
Report/Study (Hunsaker & Associates under direct contract to Caribou Industries)
Sewer/Water Study (Hunsaker & Associates under direct contract to Caribou Industries
or City's sewer consultant).
C. For the purpose of providing environmental and technical services, the City
has received a Proposal to Provide Environmental and Technical Services from
PlaceWorks in the estimated amount of Eighty -Six Thousand ($86,000) Dollars. The
PlaceWorks Scope of Services is attached herewith as Exhibit A, and the PlaceWorks
Cost Estimate is attached herewith as Exhibit B. Both Exhibits are incorporated herein
by this reference. A 10% administrative overhead fee will be charged to developer for
oversight of the PlaceWorks Agreement. The City shall make the determination as to
what type of Environmental Document is required after reviewing studies that are required
for the Project.
D. The Planning and Building Agency, City Attorney's Office, and the City
Engineer will provide Services in connection with this Project, on an hourly basis. The
City Attorney's Office hourly billing rate for reimbursable services is One Hundred Twenty
Three ($123.00) per hour, and the City Engineer's hourly rate is Two Hundred Thirty Eight
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Dollars ($238.00) per hour. City may also utilize additional external consultants,
including, but not limited to, attorneys and engineers, as necessary to complete the
review. Said consultants will be billed at their agreed upon rates with the City.
Specifically, the City intends to use outside counsel from the law firm of Best Best &
Krieger, LLP to review the environmental documents for legal sufficiency at the rate of
Three Hundred and Ten Dollars ($310.00) per hour.
E. Developer has deposited with City the amount of fifty thousand dollars
($50,000) to provide initial funding for the Services to be provided by Place Works,
Planning and Building Agency, City Attorney's Office and City Engineer. This amount
shall be applied to pay invoices received from Place Works, the Planning and Building
Agency, City Attorney's Office and City Engineer for their Services.
F. City shall provide Developer with a monthly statement of draws against the
deposit described in Section 3.E., accompanied by invoices, time records, or other
reasonable back-up therefor.
G. It is understood and agreed that if any consultant begins work on the Project
prior to execution and delivery of this Agreement by all parties, the fees incurred in
connection with the Project prior to such execution and delivery will be subject to
reimbursement pursuant to this Agreement upon execution and delivery of this
Agreement by all parties and the deposit of funds by Developer pursuant to Section 3.E.
4. Deposit.
A. At any time that City determines in good faith that the sums then held in any
deposits made pursuant to Sections 3.E. above are inadequate to pay for the projected
Services to be paid from such deposit over the succeeding two (2) month period, Developer
shall replenish the relevant deposit with the amount requested by City in writing, which
amount shall not exceed Twenty -Five Thousand Dollars ($25,000) for any particular
replenishment, within ten (10) Business Days of such written request.
B. Should any deposit not be replenished in the time and amount specified as
set forth in Section 4.A., City may direct that all Services to be paid from the deposit
applicable to such Services be halted until such time as such applicable deposit is
replenished.
C. All deposits will be placed in a non-interest bearing trust account. Developer
understands and agrees that City will not pay interest to Developer on the deposits, and
Developer will not seek interest payments from City.
D. No later than forty (40) days after the earliest to occur of: (1) final action is
taken by City on the Project, (2) Developer notifies the City in writing of its withdrawal of
the Project applications, or (3) the Project is otherwise abandoned, City will provide
Developer with a final accounting of costs and expenses, accompanied by invoices, time
records or other reasonable back-up therefor, which accounting the Developer agrees will
be conclusive, in the absence of manifest error. Should the total reimbursement amount
required for any Services be less than the total amount deposited by Developer with
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respect to such Services, City will refund any remaining deposit amount relating to such
Services to Developerwithin forty-five (45) days after determining the final reimbursement
amount for such Services.
E. In the event Developer fails or refuses to make any of the deposits required
herein, Developer shall be liable to City for the amount of all fees charged to the City for
Services actually provided which exceed the amount of the deposit paid by Developer for
such Services, and City shall have the right to pursue a breach of contract action, or any
other pertinent legal action available to the City, against the Developer. Further, the
prevailing party in any dispute and/or litigation necessary to enforce or interpret this
Agreement shall be entitled to seek and collect its costs and reasonable attorney's fees
from the other party.
5. Other Costs. Developer acknowledges that the cost of the Services does
not include all application, permitting, inspection, or other fees which may be charged by
City in connection with the Project. To the extent the fees ordinarily charged by City for
projects similar to the Project relate to costs that are not reimbursed under this
Agreement, such fees shall be separately paid in accordance with the relevant City fee
schedule.
6. No Guarantee of Approval. Developer acknowledges that its payments and
deposits described herein do not mean that the City will approve the Project nor that City
staff will make a recommendation in favor of the Project. Even if the Project is not
approved, Developer shall remain liable for all costs for Services actually provided
concerning the Project.
7. Independence of Consultants.
A. During the Term of this Agreement, Developer will not directly or indirectly
enter or propose to enter into any financial or business relationship with any of City's
consultants that are working on the Project.
B. Developer hereby acknowledges and agrees as follows:
L City has sole discretion to select which of its employees or
independent contractors are assigned to work on Developer's application;
ii. City has sole discretion to determine which persons City will hire as
consultants to work on Developer's application.
iii. As between City and Developer, City has sole discretion to direct the
work and evaluate the performance of the consultants whom the City hires to work on
Developer's application. City retains the right to terminate or replace at any time any
consultant who is assigned to work on Developer's application.
iv. City has sole discretion to determine the amount of compensation
paid to consultants hired by City to work on Developer's application.
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V. City, not Developer, shall pay consultants hired or assigned by City
to work on Developer's application from a City account under the exclusive control of City,
which is to be funded by Developer as set forth in this Agreement.
vi. Except for those disclosures required by law, including, without
limitation, the Public Records Act, all conversations, notes, memoranda, correspondence
and other forms of communication by and between the City and its consultants shall be,
to the extent permissible by law, privileged and confidential and not subject to disclosure
to the Developer.
vii. Developer shall have no claim to, nor shall Developer assert any right
in any reports, correspondence, plans, maps, drawings, news releases or any and all
other documents or work product produced by the consultants ("Consultant Work
Product"); provided, however, that in the event Developer does not successfully secure
entitlements for the Project and the City or a subsequent developer secures entitlements
using the Consultant Work Product for entitlements on the Property, the City and/or
developer shall reimburse Developer for Developer's costs for preparation of such
reports, correspondence, plans, maps, drawings, news releases or any and all other
documents.
C. City and Developer hereby acknowledge and agree that processing of
Developer's application is not contingent on the hiring of any specific consultant.
D. City and Developer hereby acknowledge and agree that Developer's duty
to reimburse City is not contingent upon the approval or disapproval of the proposed
Project, or upon the result of any action of the City.
E. Neither Developer nor its officers, employees or agents, shall communicate
with PlaceWorks, or any of the City's consultants, during the term of this Agreement
without prior approval of the City, unless such communication is initiated by PlaceWorks,
or any of the City's consultants, to obtain information about the Project which is needed
to prepare the Environmental Document.
8. Term and Termination. Absent a formal withdrawal of the Project
application(s), Developer shall not be entitled to terminate this Agreement. If Developer
does formally withdraw the Project application(s), Developer shall remain liable for all
costs for the Services incurred through the date of termination. The Term of this
Agreement shall commence upon the execution and delivery of this Agreement by all
parties hereto and shall terminate on the earliest to occur of: (a) the City taking final action
on the Project; and (b) Developer formally withdrawing its Project applications. The
provisions of Sections 6 through 23 (inclusive) shall survive termination of this Agreement.
9. Developer Default.
A. Should Developer fail to perform any of its obligations under this
Agreement, then City may, at its option, pursue any or all of the remedies available to it
under this Agreement, at law or in equity.
B. Without limiting any other remedy which may be available to it, if Developer
fails to perform any of its obligations under this Agreement, City may cease performing
its obligations under this Agreement.
C. If any amounts remain owing to City for Services actually performed prior to
termination of this Agreement, City may bring an action to recover all costs and expenses
incurred by the City in completing such Services, together with interest thereon from the
date incurred at the rate of ten percent (10%) per annum, or at the maximum legal rate,
whichever is greater.
D. City will not take the Project forward for consideration of discretionary
actions unless and until all fees are paid. If any amounts remain owing to City pursuant
to this Agreement for Services actually performed prior to termination of this Agreement,
City may withhold consideration of discretionary actions, permits and/or certificates of
occupancy until all such amounts are paid.
10. Indemnification. Developer further agrees that to the fullest extent permitted
by law, the Developer shall defend, indemnify, protect, and hold harmless, the City of
Santa Ana and its constituent public agency members, officers, employees, volunteers,
attorneys and agents (in the aggregate, the "City Indemnitees') from any and all liability,
demand, claim, action, or proceeding, whether actual, alleged, or threatened, including
by way of example but not exclusion, proceedings of an administrative or regulatory
nature and proceedings that may be associated with alternative dispute resolution (an
"Indemnified Claim") brought by third parties against any City Indemnities (including any
advisory agency of the City), to attack, set aside, void, annul, or challenge the validity of
any approvals granted for the Project, the Environmental Document concerning the
Project, or seeking damages which may arise from any approvals granted for the Project,
the Environmental Document concerning the Project, or this Agreement, other than
liabilities, demands, claims, actions or proceedings caused by the sole active negligence
or willful misconduct of the City or any City Indemnitee.
In any defense of any City Indemnitees, City shall have the absolute right to unilaterally
select the legal counsel for such City Indemnitees (with the intention of using one law firm
to defend all City Indemnitees unless conflicts of interest preclude such joint
representation), and any experts or consultants deemed necessary by City in an exercise
of City's sole discretion. Developer shall reimburse City for one hundred percent (100%)
of the City's actual fees and costs in connection with the Litigation ("Fees and Costs").
Such Fees and Costs shall include, but not be limited to, all reasonable court costs and
attorneys' fees, including other City staff time, consultants or experts, spent in regard to
defense of an Indemnified Claim.
City shall promptly render notice to the Developer of the existence of the
Indemnified Claim (a "Notice") and Developer shall defend the City Indemnitees at
Developer's expense. City shall cooperate fully with Developer in the defense of any
Indemnified Claim. In any Notice, City shall estimate the cost of its defense, which shall
include, but not be limited to, actual attorney fees, court costs, expert witnesses and
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consultant fees, and all other costs that may arise out of, or be incurred by City in the
defense of an Indemnified Claim. Upon such Notice, Developer shall promptly deposit
funds equal to the first three (3) months of the Estimated Cost with the City and shall
make additional deposits as and when required to fund the further costs of defending the
City Indemnitees for such Indemnified Claim. Failure of Developer to deposit such funds
shall be deemed a material breach of this Agreement. City shall refund, without interest,
any unused portion of the deposits once litigation is finally concluded or a dispute is
resolved regarding an Indemnified Claim.
11. Compliance with Law. Developer will, at its sole cost and expense, comply
with all of the requirements of all federal, state, and local laws now in force, or which may
hereafter be in force, pertaining to this Agreement.
12. Waiver of Breach. Any express or implied waiver of a breach of any term
of this Agreement will not constitute a waiver of any further breach of the same or any
other term of this Agreement.
13. Notices. Except as otherwise expressly provided by law, all notices or other
communications required or permitted by this Agreement or by law to be served on or
given to either party to this Agreement by the other party shall be in writing and will be
deemed received on: (i) the day of delivery if delivered by hand, e-mail (with confirmation
of receiving party) and fax (both email and fax required for notices delivered by email or
fax), or overnight courier service, during regular business hours; or (ii) on the third
business day following deposit, with postage prepaid, in the United States Postal Service
and addressed to the contracting parties. Name, address, telephone numbers, and e-mail
addresses of the Parties are as follows:
City: City of Santa Ana
Attention: Community Development Executive Director
20 Civic Center Plaza (M-25)
Santa Ana, CA 92701
Telephone: (714) 647-5360
Fax: (714) 647-6549
E-mail: SMendoza (a)santa-ana.org
A Copy to: Sonia Carvalho
City Attorney, City of Santa Ana
20 Civic Center Plaza (M-29)
Santa Ana, CA 92701
Telephone: (714) 647-5203
Fax: (714) 647-6549
E-mail: SCarvalho@santa-ana.org
Developer: Caribou Industries
Attn: Mike Harrah
President
1103 North Broadway
Santa Ana, CA 92701
Telephone: (714) 543-9484 (office)
Fax: (714) 543-9972
Either party may change its address for the purpose of this Section by giving written notice
of the change to the other party.
14. Interpretation. This Agreement is deemed to have been prepared by all of
the parties hereto, and any uncertainty or ambiguity herein shall not be interpreted against
the drafter, but rather, if such ambiguity or uncertainty exists, shall be interpreted
according to the applicable rules of interpretation of contracts under the law of the State
of California.
15. Business Day. For purposes of this Agreement, "Business Day" means any
day other than a Saturday, Sunday, a federal holiday, or a day on which City Hall for the
City of Santa Ana is closed for the conduct of regular business.
16. Successors. This Agreement shall be binding on and inure to the bvneflt Cf
the successors and assigns of the respective parties hereto. However, this Agreement
shall not be assigned by Developer in whole or in part without the prior written consent of
City.
17. Governing Law. This Agreement has been made in and will be construed
in accordance with the laws of the State of California, and exclusive venue for any action
involving or arising out of this Agreement will be in Orange County.
18. Attorneys' Fees. If a Party hereto files any action or brings any action or
proceeding against another Party arising out of this Agreement, then the prevailing Party
shall be entitled to recover as an element of its costs of suit, and not as damages, its
reasonable attorneys' fees as fixed by the court, in such action or proceeding or in a
separate action or proceeding brought to recover such attorneys' fees. For the purposes
hereof the words "reasonable attorneys' fees" mean and include, in the case of the City,
salaries (or fees) and expenses of the lawyers employed by the City (allocated on an hourly
basis) who may provide legal services in connection with the representation of the City in
any such matter.
19. Severability. Should any provision of this Agreement be held by a court of
competent jurisdiction to be either invalid or unenforceable, the remaining provisions of
this Agreement will remain in effect, unimpaired by the holding.
20. Integration. This instrument constitutes the sole agreement between City
and Developer respecting the above matters, and correctly sets forth the obligations of
City and Developer. Any Agreements or representations by City to Developer not
expressly set forth in this instrument are void.
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21. Construction. The language of each part of this Agreement will be
construed simply and according to its fair meaning, and this Agreement will never be
construed either for or against either party, whether or not that party drafted all or a portion
hereof.
22. No Prior Agreements and No Oral Modifications. This Agreement
represents the entire understanding of City and Developer with respect to the subject
matter hereof and supersedes all other prior or contemporaneous written or oral
agreements pertaining to the subject matter of this Agreement. This Agreement may be
modified, only in writing signed by the authorized representatives of City and Developer.
23. No Partnership or Joint Entity. This Agreement is not Intended to and does
not create a partnership or any other form of single or joint entity or any sort comprised
of the Parties and/or their attorneys.
24. Authority/Modification. Each party represents and warrants that all
necessary action has been taken by such party to authorize the undersigned to execute
this Agreement on behalf of such party and to engage in the actions of such party described
herein. This Agreement may be modified solely by written amendment signed by both City
and Developer. C;ty's C,ty Manager, or designee, may, execute 0-1-1-Y, such amendment on
behalf of City.
25. Counterparts. This Agreement may be executed in any number of
counterparts, each of which will be an original, but all of which together will constitute one
instrument executed on the same date.
IN WITNESS WHEREOF the parties hereto have executed this Agreement as of the day
and year first hereinabove written.
By: —
Raul Godinez III, dity Manager
ATTEST:
In
Attorney
By:
Mich,P 1 F. Harrah, President
Dated: A /i//�