HomeMy WebLinkAbout2003 CON CDC MRW Group / Latino Builders - ENA Bay Marina Dr. / Marina WayEXCLUSIVE NEGOTIATION AGREEMENT
By and Between
COMMUNITY DEVELOPMENT COMMISSION OF NATIONAL CITY
And
MRW GROUP INC. AND LATINO BUILDERS
THIS AGREEMENT ("Agreement') is entered in this 17th day of June 2003, by and
between the COMMUNITY DEVELOPMENT COMMISSION OF NATIONAL CITY, a
public body, corporate and politic ("CDC"), and MRW GROUP INC. AND LATINO
BUILDERS, ("Developer"), on the terms and provisions set forth below.
RECITALS
WHEREAS, on July 18, 1995, the City Council of the City of National City adopted
the Harbor District Redevelopment Plan Amendment for the City of National City
("Redevelopment Plan"") that expanded the National City Redevelopment Project Area
("Project Area"); and
WHEREAS, the CDC is the owner of certain real property within the Project Area, as
further described herein ("Site"'); and
WHEREAS, the Developer is interested in purchasing the Site from the CDC and
developing thereon a hotel and office complex consisting of an one hundred and twenty (120)
to one hundred and seventy (170) room hotel with a 4,000 square foot restaurant and
potentially an office building with a minimum of 8,000 square feet of space with
commercial/retail uscs occupying the ground floor (collectively, the "Project"); and
WHEREAS, the CDC and the Developer desire to enter into this Agreement to initiate
exclusive negotiations for up to two hundred and ten (210) days ("Negotiation Period") for the
ORIGINAL
purposes of (i) allowing the Developer to negotiate and finalize an agreement with a hotel
developer/operator of no less than a three star hotel ("Hotel Developer/Operator") (ii)
undertaking due diligence activities regarding the Project; (iii) designing the Project; (iv)
establishing the responsibilities, schedule, and financial parameters for development of the
Project on the Site; (v) preparing environmental studies required for Project entiticmcnts; (vi)
processing Project entitlements; (vii) setting the final Site purchase price; and (viii)
negotiating and drafting a disposition and development agreement ("DDA").
NOW, THEREFORE, in consideration of the recitals and mutual covenants and
conditions contained herein, the parties hereto agree as follows:
I. SITE
The Site constitutes the real property that is the subject of this Agreement. The Site is
approximately six (6) acres or approximately 157,159 square feet located at the intersection of
Bay Marina Drive and Cleveland Avenue. The exact square footage of the Site will be
determined during the Site planning activities outlined below. The Site is depicted on Exhibit
1, which is attached hereto and incorporated herein by this reference.
II. NEGOTIATION PERIOD
A. Contract Negotiation Period
The Negotiation Period shall commence upon the date CDC executes this Agreement
("Commencement Date"). During the first sixty (60) days of the Negotiation Period
("Contract Period"), the Developer shall Negotiate and finalize an agreement with a IIotel
Developer/Operator.
If at the conclusion of the Contract Period the Developer fails to (i) submit an
executed agreement with a Hotel Developer/Operator then this Agreement shall
automatically terminate. If the Developer does provide an executed contract with a IIotel
Developer/Operator, which must be acceptable to the CDC, then the Developer, on the sixty
(61) first day of the Negotiation Period, must deposit the Negotiation Deposit with the CDC,
as described in Section III DEVELOPER DEPOSIT of this Agreement.
B. Site Plan Development/Due Diligence
During the next ninety (90) days of the Negotiation Period ("First Due Diligence
Period"), the parties agree to negotiate in good faith to formulate the plan for development of
the Project ("Development Program"') and conduct due diligence activities. The Development
Program shall include and delineate the following elements:
1. The type and scope of the Project;
2. The interface of a phased development with the complete build out of the Site;
3. Required on and off -site infrastructure improvements;
4. Project, infrastructure, and state and local regulatory requirement costs;
5. Funding responsibilities and sources for development of the Project;
6. The parties/entities responsible for the various Project development activities;
and
7. A detailed Project development schedule.
8. Establish a minimum purchase price for the site.
During the First Due Diligence Period, the CDC and Developer, as applicable shall
conduct their respective due diligence activities, including but not limited to:
1. Developer's timely delivery and submission to the CDC of sufficient evidence that
the Developer has the required equity and financing letters of interest to complete
the hotel aspects of the Project;
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2. Developer's timely submission to CDC of expression of interest letters for the
proposed hotel on the Site from a nationally recognized franchise and proposed
operator;
3. Developer's timely delivery and submission to CDC of sufficient evidence for the
proposed restaurant development on the Site demonstrating that the proposed
operating entity and use is financially viable as well as delivery of evidence,
satisfactory to CDC, that said proposed entity has adequate equity and financing
letters of interest to complete and operate this component of the Project;
4. Developer's timely Submission and delivery to CDC of sufficient evidence for the
proposed, commercial/retail and office development demonstrating that the
proposed operating entity and use is financially viable as well as delivery of
evidence, satisfactory to CDC, that said proposed entity has adequate equity and
financing letters of interest to operate this aspect of the Project;
5. Developer's timely review of preliminary title report information prepared for the
Site;
6. Developer's timely investigation of the Site. In conjunction therewith, and subject
to the Developer receiving all prior governmental approvals and agreeing to all
conditions of such approvals, including but not limited to approvals from the Air
Quality Management District ("AQMD"), Developer and its consultants and agents
shall have the right to enter upon the Site to conduct tests, studies, and
investigations pursuant to an Early Entry Agreement, the form of which is attached
hereto and incorporated herein as Exhibit 2.
7. Developer's timely submission of the Development Program to the CDC for review
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and comment.
B. DDA/Environmcntal Review/Entitlements
Following Site Plan acceptance by the City of National City ("City") and the Board of
Directors of the CDC ("CDC Board") and the close of the First Due Diligence Period, the
CDC agrees to negotiate exclusively with the Developer for the remaining sixty (60) days of
the Negotiation Period ("Second Due Diligence Period") to:
1. Negotiate and attempt to finalize the DDA; and
2. Prepare and process the environmental studies and land use entitlements necessary
for development of the Project, including, without limitation, the amendment to the
Specific Plan for the Site.
If, at the close of the Negotiation Period, the Developer has not executed and
submitted a DDA to the CDC, this Agreement shall automatically terminate. Notwithstanding
the above, the CDC's Executive Director, in his or her sole and absolute discretion, may
extend the Negotiation Period for up to an additional one hundred twenty (120) days to
complete DDA negotiations, the environmental studies and the entitlements, if the CDC's
Executive Director determines additional time is required.
C. Execution of DDA
Upon submittal of the executed DDA by the Developer to the CDC, and provided that
all environmental and entitlement applications necessary for the Project have been accepted
and processed by the City, the Negotiation Period shall be extended for an additional sixty
(60) days ("Third Due Diligence Period") to enable the CDC and the City to:
1. Notice and conduct a pubic hearing pursuant to Section 33433 of the California
Health and Safety Code on the DDA; and
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2. Process Site development environmental and entitlement applications through
the City's Planning Commission and City Council.
The CDC agrees that during the Negotiation Period, the CDC shall not negotiate or enter into
an agreement with any other person or entity regarding development of the Site. The obligation to
negotiate in good faith requires the respective parties to communicate with each other with respect to
those issues for which agreement has not been reached, and in such communication to follow
reasonable negotiation procedures, including meetings, telephone conversations, and correspondence.
The parties understand that final accord on all issues may not be reached. It is also understood that,
(1) neither party is under any obligation to reach agreement on the DDA and (2) the CDC reserves
the right to approve or reject a DDA the Project, or any disposition of the Site, as more particularly
set forth in Part IV of this Agreement.
D. CDC and Developer Obligations
During the Negotiation Period the CDC and Developer obligations shall include, but
not be limited to, the following:
1. CDC Obligations
a. Provide the Developer with documents in the CDC's possession that
would assist the Developer with the due diligence activities described
in this Agreement; and
b. Upon acceptance of the Development Program and verification of
Developer financial commitments to both purchase and develop the
Project, prepare a DDA.
2. Developer Obligations
a. Use its hest efforts to investigate the Site;
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h. Submit site plans, elevations, schematic drawings, detailed Project
development costs, Project pro formas for individual product types as
well as a pro forma summarizing the total Project and respective returns
and other documents necessary for CDC and City review;
c. Submit proof of lender funding or loan commitment(s) that demonstrate
sufficient capital to fund both Site purchase and development of the
Project;
d. Submit proof of cash equity necessary to fund Site purchase and
development costs not funded by commercial lender loans or
partnership funds: and
DEVELOPER DEPOSIT
If the Developer submits an executed agreement with a Hotel Operator/Developer and
submits a minimum purchase price for the Site, and the CDC accepts both, as described in
Section II. A and B of this Agreement, then the Developer shall deposit with the CDC, Fifty
Thousand Dollars (S50,000) ("Negotiation Deposit"), in the form of a cashier's or certified
check, or wire transfer, payable to the CDC. The CDC agrees to hold the Negotiation Deposit
in the CDC's account.
Developer agrees that the CDC may use a portion of the Negotiation Deposit to
reimburse itself for reasonable and actual attorneys' fees, consultant fees, appraisal fees, title
reports, and any other related fees (excluding CDC staff costs), and costs ("DDA Negotiation
Costs") incurred by the CDC in (i) negotiating and preparing this Agreement, (ii) reviewing
any documents submitted in furtherance of this Agreement and/or Developer's proposal to
develop the Project, (iii) any negotiations relating to the DDA and any related documents, and
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(iv) drafting the DDA or any other related documents; provided, however, that the DDA
Negotiation Costs shall not exceed Twenty -Five Thousand Dollars ($25,000). CDC shall
submit to Developer invoices reasonably detailing DDA Negotiation Costs CDC has incurred
at the time it submits a reimbursement notice to the Developer. CDC shall be free to withdraw
funds from the Negotiation Deposit, as needed, provided that it has submitted such invoices to
the Developer. The full $50,000 Negotiation Deposit, without deduction of the DDA
Negotiation Costs, shall he refundable to Developer as a result of default by the CDC. The
$50,000 Negotiation Deposit, less the DDA Negotiation Costs ("Balance of Negotiation
Deposit"), shall be refundable to Developer in the event this Agreement is terminated prior to
or at the conclusion of the Contract Period and prior to the execution of the DDA. In the event
the DDA is fully executed and approved by all requisite action, the Balance of Negotiation
Deposit shall be applied to the Developer's purchase price for the Site if the parties
consummate the proposed transaction, and shall be retimdcd to Developer in the event the
escrow pursuant to which the CDC will convey the Site to the Developer fails to close and the
DDA is subsequently terminated.
IV. RETENTION OF DISCRETION TO APPROVE THE PROJECT AND DDA; NO
PRE-COM MITMENT
It is anticipated that the Project and the DDA providing for its implementation will he
presented to the CDC Board for approval. The parties understand that the CDC is reserving
the right to exercise its discretion as to all matters which it is, by law, entitled or required to
exercise its discretion, including, but not limited to the following:
A. Approval by the CDC of the Final Project as Contained in the DDA
The parties understand that the CDC has the complete and unfettered discretion to
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reject the DDA without explanation or cause. The risk of loss of all processing, design and
developmental costs incurred by the Developer prior to DDA approval and execution shall he
absorbed entirely by Developer unless expressly assumed, by the terms of this Agreement, by
the CDC.
B. Review and Approval by the CDC of all Discretionary Findings and
Conclusions
The duty of the CDC to dispose of the parcels comprising the Site shall be conditioned
upon the successful review and approval of all necessary findings and conclusions which the
CDC Board is required to make, including all necessary findings and determinations required
under CEQA, state and local land use provisions, and the California Community
Redevelopment Law. As to any matter which the CDC may be required to exercise its
unfettered discretion in advancing the Project to completion, nothing herein, nor to be
contained in the DDA shall obligate the CDC to exercise its discretion in any particular
manner, and any exercise of discretion reserved hereunder or required by law, shall not be
deemed to constitute a breach of CDC duties under this Agreement.
C. No Pre -Commitment by the CDC
By its execution of this Agreement, the CDC is not committing itself or agreeing to
undertake any activity requiring the subsequent exercise of discretion by the CDC, or any
department thereof including, but not limited to, the approval and execution of a DDA; the
proposal, amendment, or approval of any land use regulation governing the Site; the provision
of financial assistance for the development of any public or private interest in real property;
the authorization or obligation to use the CDC's eminent domain authority; or: any other such
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activity.
This Agreement does not constitute a disposition of property or exercise of control
over property by the CDC and does not require a public hearing. CDC execution of this
Agreement is merely an agreement to enter into a period of exclusive negotiations according
to the terms hereof, reserving final discretion and approval by the CDC as to any proposed
DDA and all proceedings and decisions in connection therewith.
V. THE DEVELOPER
A. Developer Experience
As a condition precedent to the CDC' s execution of this Agreement, Developer shall
have submitted to the CDC a detailed description of the development experience of the
Developer and its principals, associates, employees, partners, and joint ventures.
B. Offices of the Developer
The principal offices of Developer are located at:
MRW Group Inc.
2215 Guy Street
San Diego, California 92103
The Project Manager for the Developer will be: Michael R. Weber
Other prime developers, employees, consultants, or representatives who are proposed
to be directly involved in the Project will he determined by Developer and submitted to the
CDC upon any such determination.
D. Full Disclosure
The Developer shall maintain full disclosure to the CDC of its principals, officers,
stockholders, partners, joint ventures, and all other pertinent information concerning the
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Developer.
E. Assignment
The Developer without prior written approval of the CDC may not assign this
Agreement. The CDC agrees that, notwithstanding the foregoing, the Developer may assign
its rights under this Agreement to a corporation, trust, or partnership of which the Developer
owns the majority beneficial interest and operational control.
F. Progress Reports
The Developer agrees to provide written reports advising the CDC on progress and/or
problems with the proposed development every thirty (30) days during the term of the
Agreement.
VI. ENVIRONMENTAL REQUIREMENTS
The Developer shall prepare all necessary environmental documents as required by the
California Environmental Quality Act (public Resources Code Section 21,000 et. seq.) and
local regulations, for certification by the City. The Developer agrees to cooperate with the
City and the CDC, as requested, to help determine the environmental impact of the proposed
development and to prepare any other additional documents as may be needed to complete
environmental review for the development of the Project on the Site; provided, however, that
the CDC and the City shall not incur costs or expenses in collection therewith nor will CDC
or City reimburse the Developer for costs incun-ed related to preparing these materials.
VII. REAL ESTATE COMMISSIONS
The CDC has not engaged a broker, agent, or finder in connection with this
transaction. As such, the CDC will not be responsible for any claims by a broker, agent or
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finder, and the Developer agrees to defend, indemnify, and protect and hold the CDC
harmless from any claim by any broker, agent, or finder retained by the Developer.
VIII. GENERAL PROVISIONS
A. Legal Actions
1. Institution of Legal Actions
In addition to any other rights or remedies, either party may institute legal action to
cure, correct or remedy any default, to recover actual damages for any default, or to obtain
any other remedy consistent with the purposes of this Agreement; provided, however, that
Paragraph C of this Part VIII shall supersede any conflicting provisions of this Paragraph Al.
Such legal actions must be instituted and maintained in the Superior Court of the County of
San Diego, State of California, or in any other appropriate court in that county.
2. Applicable Law
The laws of the State of California shall govern the interpretation and enforcement of
this Agreement.
3. Acceptance of Service of Process
In the event that any legal action is commenced by the Developer against the CDC,
service of process on the CDC shall be made by personal service upon the Executive Director
or Secretary of the CDC, or in such other manner as may be provided by law. In the event that
any legal action is commenced by the CDC against the Developer, service of process on the
Developer shall be made by personal service upon the Developer or in such other manner as
may be provided by law, and shall be valid whether made within or without the State of
California.
B. Rights and Remedies are Cumulative
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Except as otherwise expressly stated in this Agreement, the rights and remedies of the
parties are cumulative, and the exercise by either party of one or more of its rights or remedies
shall not preclude the exercise by it, at the same or different times, of any other rights or
remedies for the same default or any other default by the other party.
C. Specific Performance as Developer's Exclusive Remedy
Subject to the Developer's right to terminate this Agreement in accordance with the
terms of Paragraph E of this Part VIII, the Developer's exclusive remedy for an uncured CDC
default under this Agreement is to institute an action for specific performance of the terms of
this Agreement, and in no event shall the Developer have the right, and the Developer
expressly waives the right, to seek monetary damages of any kind (including but not limited
to actual damages, economic damages, consequential damages, or lost profits) from the CDC
in the event of a default by the CDC under this Agreement or any action related to this
Agreement. Notwithstanding the foregoing, the Developer shall retain the right to seek a writ
of mandate in the event of any final denial by the CDC of any CDC permit approval
pertaining to the Project.
D. Attorney's Fees
If either party to this Agreement is required to initiate or defend litigation in any way
connected with this Agreement, the prevailing party in such litigation in addition to any other
relief which may be granted, whether legal or equitable, shall be entitled to its actual and
reasonable attorney's fees. if tither party to this Agreement is required to initiate or defend
litigation with a third party because of the violation of any terms or provision of this
Agreement by the other party, then the party so litigating shall be entitled to its actual and
reasonable attorney's fees from the other party to this Agreement. As used herein, the tern
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"attorney's fees" shall include attorney's fees incurred related to the foregoing described
litigation and for any appeal, and in addition a party entitled to attorney's fees shall be entitled
to all other reasonable costs for investigating such action, retaining expert witnesses, taking
depositions and discovery, and all other necessary costs incurred in such litigation. All such
fees shall be deemed to have accrued on commencement of such action and shall be
enforceable whether or not such action is prosecuted to judgment. The parties hereto
acknowledge and agree that each such party shall bear its own legal costs incurred in
connection with the negotiation, approval, and execution of this Agreement.
E. Termination Rights
Notwithstanding the nominal Negotiation Period hereinabovc set forth, either party
may terminate this Agreement if the other party has materially defaulted in its obligations
herein set forth, and the terminating party has provided the defaulting party with written
notification of such determination, and the defaulting party has refused to cure same. The
written notification shall set forth the nature of the actions required to cure such default if
curable. The defaulting party shall have thirty (30) days from the date of the written
notification to cure such default. If such default is not cured within the thirty (30) days, the
termination shall be deemed effective. For purposes of this paragraph, the parties hereby
acknowledge that time is of the essence. Each party shall also have the right to terminate this
Agreement in the event that (a) the CDC or the Developer determines that thc Project is
infeasible, based on financial or environmental impact considerations, or not in the public
interest; or (b) the parties reach an impasse in their negotiation of the DDA which cannot be
resolved after good faith efforts. Upon termination, thc CDC shall return the Balance of
Negotiation Deposit to the Developer.
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F. Indemnity
The Developer shall indemnify, protect defend and hold harmless the CDC and the
City and the CDC's and the City's respective elected officials, officers, employees,
representatives, members, and agents from and against any and all challenges to this
Agreement, or any and all losses, liabilities, damages, claims or costs (including attorneys'
fees) arising from Developer's negligent acts, errors, or omissions with respect to its
obligations hereunder or the Site, excluding any such losses arising from the sole negligence
or sole willful misconduct of the CDC or the conduct of third parties outside the control of the
Developer. This indemnity obligation shall survive the termination of this Agreement.
Notwithstanding the foregoing, in the event of a third party challenge to the validity of this
Agreement, Developer shall have the option to terminate this Agreement in lieu of its
indemnity obligation.
G. Notices Demand and Communications Between the Parties
Formal notices, demands, and communications between CDC and Developer shall he
given either by (i) personal service, (ii) delivery by reputable document delivery service such
as Federal Express that provides a receipt showing date and time of delivery, or (iii) or by
mailing in the United States mail, certified mail, postage prepaid, return receipt requested,
addressed to:
To CDC: Community Development Commission
140 E. 12`h Street, Suite B
National City, CA 91950
Attn: Paul Desrochers
With copy to:
Foley and Lardner
402 West Broadway, 23rd Floor
San Diego, CA 92101-3542
Attn: Richard Moskitis, Esq.
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To Developer:
With copies to:
MRW Group Inc.
2215 Guy Street
San Diego, Ca 92103
Attn: Michael R. Weber
Latino Builders Industry Assoc.
3911 Pacific Highway #214
San Diego, Ca 92110
Attn: Jose Mireles
Notices personally delivered or delivered by document delivery service shall he
deemed effective upon receipt. Notices mailed in the manner provided above shall be deemed
effective on the second business day following deposit in the United States mail. Such written
notices, demands, and communications shall be sent in the same manner to such other
addresses as either party may from time to time designate by mail.
H. Nonliahility of City and CDC Officials and Employees
No member, official, employee, or contractor of the City or the CDC shall be
personally liable to the Developer in the event of any default or breach by the CDC or for any
amount, which may become due to the Developer or on any obligations under the terms of the
Agreement.
I. Enforced Delay; Extension of Times of Performance
In addition to specific provisions of this Agreement, performance by either party
hereunder shall not be deemed to be in default where delays or defaults are due to war,
insurrection, strikes, lock -outs, riots, floods, earthquakes, fires, casualties, supernatural
causes, acts of the public enemy, epidemics, quarantine restrictions, freight embargoes, lack
of transportation, governmental restrictions or priority, litigation, unusually severe weather,
inability to secure necessary labor, materials or tools, delays of any contractor, subcontractor
or supplies, acts of the other party, acts or failure to act of the City or any other public or
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governmental the CDC or entity, including, without limitation, unreasonable delays in the
processing and issuance of required permits for the construction and/or re -construction of the
Project by the Developer (except that any act or failure to act of the CDC shall not excuse
performance by the CDC) or any other causes beyond the reasonable control or without the
fault of the party claiming an extension of time to perform. Notwithstanding the foregoing,
inability to secure satisfactory financing, tenant commitments, or market and economic
conditions shall not entitle the Developer to an extension of time to perform. An extension of
time for any such cause shall be for the period of the enforced delay and shall commence to
run from the time of the commencement of the cause, if notice by the party claiming such
extension is sent to the other party within thirty (30) days of knowledge of the commencement
of the cause. In addition, times of performance under this Agreement may be extended by
mutual written agreement by the CDC and the Developer.
J. Interpretation
The terms of this Agreement shall be construed in accordance with the meaning of the
language used and shall not be construed for or against either party by reason of the
authorship of this Agreement or any other rule of construction which might otherwise apply.
The Part and Paragraph headings are for purposes of convenience only, and shall not he
construed to limit or extend the meaning of this Agreement.
K. Entire Agreement, Waivers, and Amendments
This Agreement integrates all of the terms and conditions mentioned herein, or
incidental hereto, and supersedes all negotiations or previous agreements between the parties
with respect to all or any part of the subject matter hereof. All waivers of the provisions of
this Agreement must be in writing and signed by the appropriate authorities of the party to be
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charged, and all amendments and modifications hereto must be in writing and signed by the
appropriate authorities of CDC and Developer.
L. Counterparts
This Agreement may be executed in counterparts, each of which, after all the parties
hereto have signed this Agreement, shall be deemed to be an original, and such counterparts
shall constitute one and the same instrument.
M. Successors
This Agreement shall be binding upon and shall inure to the benefit of the permitted
successors of each of the parties hereto.
N. Further Assurances
The parties hereto each agree, without further consideration, to execute such other and
further documents, and to perform such other and further acts, as may be necessary or proper
in order to consummate the transaction set forth in and contemplated by this Agreement.
O. Severability
In the event any section or portion of this Agreement shall be held, found, or
determined to be unenforceable or invalid for any reason whatsoever, the remaining
provisions shall remain in effect, and the parties hereto shall take further actions as may be
reasonably necessary and available to them to effectuate the intent of the parties as to all
provisions set forth in this Agreement.
P. Time is of the Essence
Time is of the essence for each of the Developer's obligations under this Agreement.
Q. Confidentiality
The Developer acknowledges and agrees that the CDC is a public entity with a
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responsibility and, in many cases, legal obligation to conduct its business in a manner open
and available to the public. Accordingly, any infornation provided by the Developer to the
CDC with respect to the Site, the Project or the Developer may be disclosed to the public
either purposely, inadvertently, or as a result of a public demand or order. With respect to any
information provided that the Developer reasonably deems and identifies in writing as
proprietary and confidential in nature, the CDC agrees to exercise its hest efforts to keep such
information confidential.
(Signatures on next page)
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IN WITNESS WIIEREOF, the CDC and the Developer have signed this Agreement
on the respective dates set forth below.
Community Development Commission
Of the City of National City
By:
Nick inza, Chairman
ATTES
By:
aul es crs, Secretary
APPROVED AS TO FORM:
By: n
Dated:
George Eiser, TIICDC Counsel
MRW Group Inc.
A Nevada Corporation
Latino Build- s Industry Assoc.
A non -pro Corporatieri�
By: ,
Dated:
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i. ,..--..-,.,,,,,..- .....,.. '• _. v.
Exhibit 1
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Exhibit 2
RIGHT OF ENTRY AGREEMENT
THIS RIGHT OF ENTRY AGREEMENT ("Agreement") is made and entered into as of May 20, 2003
by and between the COMMUNITY DEVELOPMENT COMMISSION OF THE CITY OF
NATIONAL CITY, a public body, corporate and politic (the "CDC"), and THE MRW GROUP INC., a
Nevada corporation (the "Developer"), with respect to the following:
RECITALS
A. The CDC and the Developer have entered into an Exclusive Right to Negotiate Agreement, dated
as of May 20, 2003, for the negotiation of a disposition and development agreement with respect to
certain real property in the City of National City known as Assessor Parcel Nos. 559-160-03,09,11, 21
and 559-117-14, 15 (the "Property").
B. The Developer desires to perform certain predevelopment work consisting of certain tests, studies,
and analyses necessary to evaluate the condition of the Property (the "Predevelopment Work").
C. The CDC wishes to accommodate the Developer's desire to commence the Predevelopment Work
on the Property by granting a right of entry to Developer upon certain terms and conditions.
NOW, THEREFORE, for good and valuable consideration, Developer and CDC do hereby
agree as follows:
1. Right of Entry. Provided that all of the terms and conditions of this Agreement are fully
satisfied, the CI)C hereby grants to Developer and its employees, agents and contractors the nonexclusive
right to enter upon the Property to perform the Predevelopment Work, and for no other purposes without
the prior written approval of the CDC's Executive Director or his designee. This Agreement shall
automatically terminate and expire one hundred and twenty (120) days from the date of this Agreement.
The term of this Agreement may be extended at the sole and absolute discretion of the CDC Executive
Director or his designee for an additional period not to exceed thirty (30) days. It is expressly understood
that this Agreement does not in any way whatsoever grant or convey any rights of possession, casement
or other interest in the Property to the Developer.
2. Agreement. By execution of this Agreement, Developer agrees for itself and on the behalf of its
employees, agents, consultants and contractors as follows:
(a) That Developer will not permit any dangerous condition to be created on the
Property.
(b) That all acts and things done by Developer on the Property will be done in a
careful and reasonable manner, in accordance with all federal, state and local laws.
(c)
That Developer enters the Property entirely at its own cost, risk and expense.
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(d) That prior to the Developer's entry upon the Property and during the period of this
Agreement, there shall be in effect and shall provide satisfactory evidence to the
CDC of the following:
a. Workers' compensation insurance as required by law;
b. Commercial general liability insurance written on an occurrence basis, with
a combined single limit of at least one Million Dollars ($1,000,000)
consisting of both bodily injury and property damage coverage; and
c. Automobile liability insurance, including liability for all owned, hired and
non -owned vehicles, with minimum limits of One Million Dollars
($1,000,000) for bodily injury per person, One Million Dollars
($1,000,000) property damage and One Million Dollars ($1,000,000)
combined single limit per occurrence.
CDC of National City shall be named as an additional insured under the commercial
general liability policy.
(e) That Developer shall not permit any mechanics', material men's or other liens of
any kind or nature ("Liens") to be filed or enforced against the Property in connection with the
Prcdevelopment Work. Developer shall indemnify, defend and hold harmless CDC from all liability for
any and all liens, claims and demands, together with costs of defense and reasonable attorneys' fees,
arising from any Liens. CDC reserves the right, at its sole cost and expense, at any time and from time to
time, to post and maintain on the Property, or any portion thereof, or on the improvements on the
Property, any notices of non -responsibility or other notice as may be desirable to protect CDC against
liability. In addition to, and not as a limitation of CDC's other rights and remedies under this Agreement,
should the Developer fail, within ten (10) days of written request from CDC, either to discharge any Lien
or to bond for any Lien, or to defend, indemnify, and hold harmless CDC from and against any loss,
damage, injury, liability or claim arising out of a Lien, then CDC, at its option, may elect to pay such
Lien, or settle or discharge such Lien and any action or judgment related thereto and all costs, expenses
and attorneys' ices incurred in doing so shall be paid to CDC by the Developer upon written demand.
(f) That Developer shall not have any interest in the Property or he entitled to any
reimbursement or repayment for any work performed upon the Property pursuant to this Agreement.
Developer shall, at the written request of the CDC, leave the Property in a condition that does not create
an unreasonable risk of harm to the public.
(g) The Developer shall take all necessary precautions to prevent the import and/or
release into the environment of any hazardous materials, which are imported to, in, on or under the
Property during the performance of the Predevelopment Work. if hazardous materials are imported onto
the Property as a result of the performance of the Predevelopment Work, the Developer shall be solely
responsible for removing such imported hazardous materials in conformance with all Governmental
Requirements. The Developer shall report to the CDC, as soon as possible after each incident, any
unusual or potentially important incidents with respect to the environmental condition of the Property.
3. indemnity. Developer hereby agrees to defend, indemnify and hold the CDC and its officers,
officials, members, employees, agents and representatives, harmless from and against any and all loss,
damage, injury, liability, claim, cost or expense (including, without limitation, reasonable attorneys' fees,
expert witness fees, court costs, and expenses) arising from or attributable to the activities of Developer or
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any of its employees, agents, consultants or contractors upon the Property pursuant to this Agreement.
All use of and entry upon the Property shall be at the sole cost, risk and expense of the Developer.
4. Miscellaneous.
(a) Choice of Law. This Agreement is to be governed hy, and construed in
accordance with, the laws of the State of California.
(b) Remedies. Either party shall, in addition to all other rights provided herein or as
may be provided by law, be entitled to the remedies of specific performance and injunction to enforce its
rights hereunder, except to the extent expressly provided to the contrary in this Agreement. All rights and
remedies under this Agreement are cumulative and no one of them shall he exclusive of any other, and
each party shall have the right to pursue any one or all of such rights and remedies or any other remedy
which may be provided by law, whether or not stated in this Agreement, except to the extent expressly
provided to the contrary in this Agreement.
(c) Counterparts. This Agrccment may be executed in two (2) or more counterparts,
each of which shall be deemed an original but all of which together shall constitute one and the same
instrument.
(d) Non -Liability of Public Officials. No officer, employee, member, agent or
representative of the CDC shall be personally liable to Developer, or any successor in interest, in the
event of any default or breach by the CDC, or for any amount which may become due to Developer or its
successor, or for any breach of any obligation of the terms of this Agreement.
IN WITNESS WIIEREOF, the parties hereto have entered into this Agreement as of the date first set
forth above.
CDC:
COMMUNITY DEVELOPMENT COMMISSION
OF THE CITY OF NATIONAL CITY, a public body,
corporate and politic
By:
DEVELOPER:
MRW GROUP INC, a Nevada co oration
Its: Presi
By:
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