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HomeMy WebLinkAboutILLUMINATION FOUNDATION, THE (2)a k� � ,. AA, 7QIIIRFD W 'I OCV ) A-2020-130-01 �'.CDAUKTOVi .5)Fp,- TERMINATION AGREEMENT THIS TERMINATION AGREEMENT, with respect to the operating and funding agreements with The Illumination Foundation to Operate a Year -Round Iomeless Navigation Center and Recuperative Care Facility, is made and entered into this day of March, 2021 ("Effective Date"), by and between The Illumination Foundation ("IF"), and 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"). IF and City are herein referred to individually as a "Party" and collectively as the "Parties." RECITALS A. The Parties entered into the Agreement with The Illumination Foundation to Operate a Year - Round Homeless Navigation Center and Recuperative Care Facility, dated June 16, 2020, City Agreement NoW2020-130 ("Operating Agreement"), for IF to provide all premises, approvals, facilities, labor, staffing, training, equipment, building improvements, services, and items appropriate and necessary to fully and adequately develop, construct, and operate a year-round homeless navigation center and recuperative care facility on the property located at 1815 Carnegie Avenue in Santa Ana ("Carnegie Shelter" or "subject property"). B. The Parties also entered into multiple funding agreements related to the Operating Agreement, including the following funding agreements that are still effective: Agreement between the City of Santa Ana and Illumination Foundation for use of Emergency Solutions Grant Coronavims (ESG-CV) Funds, dated August 19, 2020, City Agreement No. A-2020- 131-03; Agreement between the City of Santa Ana and Illumination Foundation for use of Emergency Solutions Grant Coronavims (ESG-CV) Funds, dated November 2, 2020, City Agreement No. A-2020-131-03; Homeless Housing, Assistance and Prevention Subcontractor Agreement between the City of Santa Ana and The Illumination Foundation, City Agreement No. A-2020-131-05; and, Homeless Emergency Aid Program Subcontractor Agreement between the City of Santa Ana and The Illumination Foundation, City Agreement No. A-2020-131-06 ("Funding Agreements"). C. During the initial stages of construction, a dispute arose between the Parties regarding the total cost for the construction of the Camegie Shelter and the responsibility of the Parties for such construction cost. The City sent written notice to IF on November 20, 2020, regarding its concerns with the budget and providing IF with an opportunity to cure this issue. IF provided written responses to the City dated November 30, 2020, December 15, 2020, and January 20, 2021, but IF and the City were unable to reach an agreement about the construction budget. Accordingly, the City sent IF written correspondence dated January 25, 2021, accepting IF's offer to voluntarily remove itself from the project. D. The Parties hereby desire to enter into this Termination Agreement in order to express their mutual agreement to terminate the Operating Agreement and Funding Agreements for the Camegie Shelter pursuant to the terms provided herein. NOW THEREFORE, in consideration of the mutual and respective promises, and subject to the terms and conditions hereinafter set forth, the Parties agree as follows: Page 1 of 5 1. TERMINATION Except as provided for in this Termination Agreement, the Parties mutually agree to terminate and cancel the Operating Agreement as of the Effective Date. Additionally, the Parties mutually agree to terminate and cancel the Funding Agreements once the City has completed all required payments to IF pursuant to the terms provided herein. 2. RELEASE OF PROPERTY Upon termination, IF shall concurrently surrender all possession, rights, and title under its Lease Agreement with Dyer 18, LLC to the subject property located at 1815 Carnegie Avenue in Santa Ana pursuant to sections 2(b) and 15 of the Operating Agreement. This Release of Property shall be completed through the concurrent execution of the Assignment of Lease and Lease Termination Agreement between the Parties and Dyer 18, LLC ("Assignment Agreement"). 3. CONSTRUCTION SUBCONTRACTORS Upon compliance with all terms and requirements of this Termination Agreement, IF shall be entitled to receive and the City shall pay IF compensation for all reasonable services adequately performed by IF and its subcontractors, including Gensler, Turelk, Trestle, and any other entities that provided work on the subject property by contract with IF or its subcontractors ("Construction Subcontractors"), prior to the Effective Date of this Termination Agreement. IF herein confirms that all invoices from Construction Subcontractors have been submitted to the City. Accordingly, the City shall not be responsible for invoices from Construction Subcontractors submitted after the Effective Date of this Agreement. In exchange, IF shall be responsible for obtaining all customary lien releases from the Construction Subcontractors related to work completed on the subject property. Additionally, IF agrees to work cooperatively with the City during the transition of the Carnegie Shelter property to new contractors. 4. OWNERSHIP OF PLANS AND MATERIALS City shall be the owner of all construction and architectural plans and materials prepared by the Construction Subcontractors related to the subject property. IF shall, unless otherwise prohibited by law, obtain all rights and necessary releases to such materials, including electronic versions as applicable, and transfer ownership of all such construction and architectural plans and materials to the City. 5. MUTUAL RELEASE OF PARTIES IF and City hereby expressly acknowledge and agree that it is their express intent to waive and release each other from and against all claims and liabilities relating to their activities pursuant to the Operating Agreement on or prior to the Effective Date, with the exception of any and all claims by Construction Subcontractors ("Lien Claims"). The Lien Claims shall remain the sole responsibility and liability of IF. IF agrees to pay all such Lien Claims as soon as reasonably possible. Notwithstanding the foregoing, City acknowledges that City remains liable to fund IF's payment of the Lien Claims upon review and approval. The City shall fund IF's payment of all such Lien Claims approved by the City as soon as reasonably possible. As such, except with respect to IF obtaining lien releases and City funding of the approved Lien Claims and any other Page 2 of 5 obligations of the Parties under this Agreement, each party hereto hereby waives and releases any and all other claims, demands, rights, covenants, causes of action, damages, and liabilities which they may now own or hold, or may in the future own or hold, against each other Party hereto, arising out of or relating to acts, failure to act or any breach or default under the Operating Agreement on or prior to the Effective Date. Each Party acknowledges and agrees that it is familiar with and understands and has been counseled by its attorneys regarding the provisions of California Civil Code Section 1542, which provides as follows: "A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS THAT THE CREDITOR OR RELEASING PARTY DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE AND THAT, IF KNOWN BY HIM OR HER, WOULD HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR OR RELEASED PARTY." Each Party, being aware of said Code Section, hereby expressly waives any rights it may have thereunder, as well as any other statute or common law principle of similar effect as may relate to this Waiver and Release. �L IF's Initials nitials 6. INDEMNIFICATION Except as may otherwise be set forth herein, City shall indemnify, defend and hold IF harmless from and against any and all demands, claims, actions, losses, damages, liabilities, litigation and costs and expenses thereof including, without limitation reasonable attorneys' fees and disbursements of any kind and nature whatsoever (collectively, "IF Claims"), which may be imposed on, asserted against or otherwise incurred by IF by or on behalf of any person or entity whatsoever due to or arising from the failure or alleged failure of City, to undertake, perform, pay, discharge or observe any covenants, terms and conditions which first arise or accrue from and after the Effective Date. Except as may otherwise be set forth herein, IF shall indemnify, defend and hold City harmless from and against any and all demands, claims, actions, losses, damages, liabilities, litigation and costs and expenses thereof including, without limitation, reasonable attorneys' fees and disbursements of any kind and nature whatsoever (collectively, "City Claims"), which may be imposed on, asserted against or otherwise incurred by City by or on behalf of any person or entity whatsoever due to or arising from the failure or alleged failure of IF to undertake, perform, pay, discharge or observe any covenants, terms and conditions which first arose or accrued prior to the Effective Date. This Section is not intended to supersede, modify or limit any indemnification obligations of the Parties under the Assignment Agreement. 7. EXCLUSIVITY AND AMENDMENT This Termination Agreement constitutes the entire agreement between IF and the City concerning this subject matter and fully replaces all prior negotiations, proposed agreements, or agreements, written, oral, or implied, between IF and the City. This Termination Agreement can be modified only by another written document signed by IF and the City. This Section is not Page 3 of 5 intended to supersede, modify or limit any obligations of the Parties under the Assignment Agreement. 8. GOVERNING LAW AND VENUE This Termination Agreement has been executed and delivered in the State of California and the validity, interpretation, performance, and enforcement of any of the clauses of this Termination Agreement shall be determined and governed by the laws of the State of California. Both parties further agree that Orange County, California, shall be the venue for any action or proceeding that may be brought or arise out of, in connection with or by reason of this Termination Agreement. 9. COUNTERPARTS This Termination Agreement may be signed separately by the City and IF, such that the page signed by IF and the page signed by the City, although signed separately on different pages, together form one complete Termination Agreement. Signature pages sent by e-mail or facsimile are the equivalent of original signatures for all purposes. 10. AUTHORITY Each Party warrants that the individuals who have signed below have the legal power, right, and authority to so sign and thereby bind that Party and its successors, assigns, personal representatives, executors, estate, heirs, agents, and related entities of the respective Parties. {Signatures on following page} Page 4 of 5 A-2020-130-01 IN WITNESS WHEREOF, the Parties hereto have executed this Termination Agreement the date and year first above written. CITY OF SANTA ANA Kristine Ridge � City Manager ATTEST: gkaj 3 Daisy Gomez Clerk of the Council APPROVED AS TO FORM: SONIA R. CARVALHO City Attorney By: Ryan C dg Assistant City Attorney FOR APPROVAL: Steven Mendoza Executive Director Community Development Agency THE ILLUMINATION FOUNDATION Name: Paul Leon Title: IF CEO Page 5 of 5