Palm Springs City Council
March 11, 2026

ATTACHMENT A
(2023 Draft Agreement with
Selene Palm Springs, LLC
approved on June 5, 2023)
55575.18175\40908266.11

SETTLEMENT AND DEVELOPMENT AGREEMENT
by and between

THE CITY OF PALM SPRINGS
and

SELENE PALM SPRINGS, LLC

Dated _____________, 2023

55575.18175\40908266.11

TABLE OF CONTENTS
Page
i

ARTICLE I SETTLEMENT AGREEMENT ............................................................................ 2 Section 1.1. Settlement, No Admissions by Parties ....................................................... 2 Section 1.2. Mutual General Releases ........................................................................... 2 Section 1.3. California Civil Code Section 1542 ........................................................... 2 ARTICLE II DEVELOPMENT AGREEMENT ........................................................................ 3 Section 2.1. Representations and Warranties ................................................................. 3 Section 2.2. Effective Date ............................................................................................ 6 ARTICLE III PROJECT FINANCING ........................................................................................ 6 Section 3.1. Evidence of Financing .............................. Error! Bookmark not defined.

Section 3.2. Unauthorized Liens .................................................................................... 6 Section 3.3. Rights of Lenders and City Regarding Permitted Loans and Liens .. Error! Bookmark not defined.

Section 3.4. Developer Covenants ............................................................................... 14 Section 3.5. Insurance .................................................................................................. 20 Section 3.6. Workers’ Compensation Insurance Requirement .................................... 20 Section 3.7. Liability and Permanent Insurance Requirements ................................... 21 Section 3.8. Defaults - General .................................................................................... 23 Section 3.9. Events of Default………………………………………………………...23 Section 3.10. Repurchase Option ................................................................................... 24 ARTICLE IV MISCELLANEOUS ............................................................................................ 25 Section 4.1. No Third-Party Beneficiaries; No Assignment ........................................ 25 Section 4.2. Enforcement of Agreement ...................................................................... 25 Section 4.3. Damages ................................................................................................... 26 Section 4.4. Limits ....................................................................................................... 26 Section 4.5. No Waiver ................................................................................................ 26 Section 4.6. Notices ..................................................................................................... 26 Section 4.7. Entire Agreement ..................................................................................... 26 Section 4.8. Amendments and Modifications .............................................................. 27 Section 4.9. Rights of Lender to Modify Agreement................................................... 27 Section 4.10. Choice of Law and Arbitration ................................................................ 27 Section 4.11. Authorized Signatory ............................................................................... 27 Section 4.12. Severability .............................................................................................. 27 Section 4.13. Counterparts; Electronic Signatures ........................................................ 27

- ATTACHMENT A - LEGAL DESCRIPTION
- ATTACHMENT B - BENCHMARK SCHEDULE
- ATTACHMENT C - SCOPE OF DEVELOPMENT/ENTITLEMENT PACKAGE

55575.18175\40908266.11

1 SETTLEMENT AGREEMENT

This Settlement and Development Agreement (“Agreement”), dated as of May 1, 2023, is entered into by and between the City of Palm Springs ( “City”) and Selene Palm Springs, LLC, a California limited liability company (“Developer”). City and Developer may be referred to herein individually as a “Party” or collectively as the “Parties.”

RECITALS
A. Developer acquired that certain approximately 7.8 acre parcel located at the northeast corner of Calle Alvarado and East Amado Road ( “Property”), more fully described in Attachment A, from the City under that certain Grant Deed recorded as Document No. 2016 - 0367646 ( “Grant Deed ”) pursuant to the previously entered Purchase and Sale Agreement (A6329), as amended by eleven amendments dated between March of 2014 and April of 2020 (“PSA”); the related Services Agreement, as amended by three amendments dated between March of 2014 and December of 2018 ( “SA”); and the Amended and Restated Operations Covenant Agreement No. 6642, recorded as Document No. 2017 -0544662 (“Covenants”, together with the PSA and SA, the “Original Development Agreement”) between the City and Developer for the purpose of developing and maintaining a hotel project (“Original Project”) located on the Property.

B. The Parties have agreed to use thi s Agreement to achieve and establish the terms for a full and complete resolution of all claims and actions that, as of the date hereof, have been or could be asserted in connection with the Original Development Agreement, and to set forth terms for the development of the Project (as defined below) going forward.

C. In 2022, Developer submitted a revised project to the City for entitlement. The Revised Project (“Project”) includes the following and is described in greater detail in Scope of Development, Attachment C attached hereto and incorporated herein, and the Dream Hotel and Condominium Application as approved by the City Council on May 11, 2023:
• Between 150-160 Transit Occupancy Tax (“TOT”) generating hotel rooms. • No less than 28 residential units in the hotel tower which will be short term rental eligible. These units shall also be subject to the same TOT benefit as the hotel rooms set forth above.
• No less than 12 luxury residential units in the North Villas which will not be short term rental eligible.
• No less than 24 residential units in the South Villas which will not be short term rental eligible.

D. Developer and City agree that, in the interest of purs uing the Project, setting forth a new schedule of performance and obligations of the Parties is desirable.

E. The Developer intends to construct the Project in accordance with Attachment B. 55575.18175\40908266.11

2 TERMS
NOW THEREFORE , in consideration of the mutual covenants, agreements, representations, and warranties contained in this Agreement, an d other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the Parties agree as follows:

A. Recitals. The foregoing Recitals are incorporated into and are hereby made a part of this Agreement.

ARTICLE I

SETTLEMENT AGREEMENT
Section 1.1. Settlement, No Admissions by Parties . Each of the Parties acknowledges that this Agreement is for settlement purposes and relates to the avoidance of the fees, costs, expenses, and risks associated with the litigation of potential claims and defenses and the preclusion of any potential actions described herein. Therefore, the Parties agree that this Agreement is not to be treated or construed, at any time or in any manner whatsoever, as an admission by any Party of wrongdoing, fault, violation of law, or liability of any kind, as of the Effective Date, of any allegations or claims arising out of or connected to the Property, the Original Project or the Original Development Agreement.

Section 1.2. Mutual General Releases.

1.2.1 Except for the requirements and terms set forth in this Agreement, Developer releases City, and its council members, officials, officers, employees, attorneys, contractors, agents, and representatives, from any and all claims, demands, liabilities, obligations, costs, expenses, fees, actions, or cau ses of action that Developer has or had, as of or prior to the Effective Date, arising out of or connected to the Property, the Original Project or the Original Development Agreement, whether known, unknown, or suspected.

1.2.2 Except for the requirements and te rms set forth in this Agreement, City releases Developer, its managers, members, officers, directors, employees, contractors, attorneys, agents, and representatives, from any and all claims, demands, liabilities, obligations, costs, expenses, fees, actions, or causes of action that City has or had, as of or prior to the Effective Date, arising out of or connected to the Property, the Original Project or the Original Development Agreement, whether known, unknown, or suspected.

Section 1.3. California Civil Code Section 1542.

1.3.1 Contingent upon the full completion of the terms of this Agreement, to the maximum extent provided by law, each Party hereby fully and forever releases the other Party from any claims, debts, or obligations, as of or prior to the Effective Date, ar ising from the Property, the Original Project, the Original Development Agreement, or actions of a Party in connection therewith. Each Party acknowledges it has had the opportunity to receive independent legal advice with respect to the advisability of mak ing this Agreement and with respect to the 55575.18175\40908266.11

3 meaning of Section 1542 of the California Civil Code, and that they are freely and voluntarily entering in this Agreement and understand this Agreement in its entirety.

1.3.2 Contingent upon the full completion of the terms of this Agreement, it is the intention of the Parties that the mutual release entered into as part of this Agreement shall be effective as a bar to all actions, causes of action, obligations, costs, expenses, attorney ’s fees, damages, losses, claims, liabilities and demands of any character, nature and kind, known or unknown, suspected or unsuspected, as of or prior to the Effective Date, related to the Property, the Original Project, the Original Development Agreement to be so barred; in furtherance of which intention the Parties expressly waive any and all right and benefit conferred upon them by the provisions of Section 1542 of the California Civil Code, which reads 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.”
______________________ ______________________
City Selene Palm Springs, LLC

1.3.3 The Parties hereby acknowledge that the foregoing waiver of the provisions of Section 1542 of the California Civil Code was bargained for separately. The Parties expressly agree that the release provision h erein contained shall be given full force and effect in accordance with each and all of the express terms and provisions herein, including but not limited to those terms and provisions relating to unknown or unsuspected claims, demands and causes of action hereinabove specified. The Parties specifically agree to assume the risk of the subsequent discovery or understanding of any matter, fact, or law which if now known or understood would in any respect have affected this Agreement.

ARTICLE II

DEVELOPMENT AGREEMENT
Section 2.1. Representations and Warranties.

2.1.1 City Representations and Warranties . The representations and warranties of City contained in this section shall be based upon the actual knowledge of the City Manager as of the Effective Date (hereinafter defined). All re presentations and warranties contained in this section are true and correct as of the Effective Date. City’s liability for misrepresentation or breach of warranty, representation or covenant, wherever contained in this Agreement, shall survive the executi on and delivery of this Agreement. City hereby makes the following representations, covenants, and warranties and acknowledges that the execution of this Agreement by Developer has been made in material reliance by Developer on such covenants, representations, and warranties:

A. City is a California municipal corporation, duly formed and operating under the laws of the State of California. City has the legal power, right, and authority 55575.18175\40908266.11

4 to enter into this Agreement and to execute the instruments and documents referenced herein, and to consummate the transactions contemplated hereby.

B. The persons executing any instruments for or on behalf of City have been authorized to act on behalf of City, this Agreement is valid and enforceable against City in accordance wi th its terms, and each instrument to be executed by City pursuant hereto or in connection therewith will, when executed, shall be valid and enforceable against City in accordance with its terms. No approval, consent, order or authorization of, or designat ion or declaration of any other person, is required in connection with the valid execution and delivery of this Agreement by City.

C. City has taken all requisite action and obtained all requisite consents for agreements or matters to which City is a party in connection with entering into this Agreement and the instruments and documents referenced herein and in connection with the consummation of the transactions contemplated hereby.

D. If the City becomes aware of any act or circumstance that would change or render incorrect, in whole or in part, any representation or warranty made by the City under this Agreement, whether as of the date given or any time thereafter, whether or not such representation or warranty was based upon the City’s knowledge and/or belief as of a certain date, the City will give prompt written notice of such changed fact or circumstance to the Developer.

E. City agrees that the TOT grant to Developer was effective as of the date it was granted and remains effective.

2.1.2 Developer Representations and Warranties. The representations and warranties of Developer contained in this section shall be based upon the actual knowledge of Rabinder Pal Singh, as agent for the Developer, as of the Effective Date. All representations and warranties contained in this section are true and correct as of the Effective Date. Developer’s liability for misrepresentation or breach of warranty, representation, or covenant, wherever contained in this Ag reement, shall survive the execution and delivery of this Agreement.

Developer hereby makes the following representations, covenants, and warranties and acknowledges that the execution of this Agreement by City has been made in material reliance by City on such covenants, representations and warranties:

A. Developer is a California limited liability company, lawfully entitled to do business in the State of California and the City. Developer has the legal right, power, and authority to enter into this Agreeme nt and the instruments and documents referenced herein and to consummate the transactions contemplated hereby. The persons executing this Agreement and the instruments referenced herein on behalf of Developer hereby represent and warrant that such persons have the power, right, and authority to bind Developer.

B. Developer has taken all requisite action and obtained all requisite consents in connection with entering into this Agreement and the instruments and documents referenced herein and the consummation of the transactions contemplated hereby, and no consent of any other party is required for Developer’s authorization to enter into Agreement. 55575.18175\40908266.11

5 C. Neither the execution of this Agreement nor the consummation of the transactions contemplated hereby shall result in a breach of or constitute a default under any other agreement, document, instrument or other obligation to which Developer is a party or by which Developer may be bound, or under law, statute, ordinance, rule, governmental regulation or any writ, injunction, order, or decree of any court or governmental body applicable to Developer or to the Property.

D. This Agreement is, and all agreements, instruments, and documents to be executed by Developer pursuant to this Agreement shall be, duly executed by and shall be valid and legally binding upon Developer and enforceable in accordance with their respective terms. No approval, consent, order, or authorization of, or designation or declaration of any other person, is required in connection with the valid execution and delivery of and compliance with this Agreement by Developer.

E. If the Developer becomes aware of any act or circumstance that would change or render incorrect, in whole or in part, any representation or warranty made by the Developer under this Agreement, whether as of the date given or any time thereafter, whether or not such representation or warranty was based upon the Developer’s knowledge and/or belief as of a certain date, the Developer will give prompt written notice of such changed fact or circumstance to the City.

2.1.3 Restrictions on Assignment or Transfer.

A. The Developer acknowledges that the qualifications and identity of Developer is of particular importance to the City and therefore Transfer s are permitted only as provided in this Agreement. Except as set forth in this Section or other provisions of this Agreement, prior to the Project Completion Date as set forth in Attachment B (“Project Completion Date”), the Developer shall not sell, assign, convey, create any trust estate with respect to or otherwise transfer any of its interests in this Agreement and/or the Project (collectively, “Transfers”; individually, a “Transfer,”) if such Transfer will constitute a change in control of the Project or Developer without the prior written approval of the City Manager, which approval shall not be unreasonably withheld, conditioned or delayed . For the avoidance of doubt and notwithstanding anything to the contrary in this Agreement, without the consent or approval of City, Developer may collaterally assign this Agreement to a mortgage lender and the Property or any portion thereof may be conveyed by foreclosure or deed in lieu of foreclosure.

B. At least 30 days prior to any such change, the Developer shall notify the City in writing of an y and all changes whatsoever in the identity of the business entities or individuals either comprising or in control of the Developer, as well as any and all changes in the interest or the degree of control of the Developer by any such person, of which inf ormation the Developer or any of its partners, members or officers are notified or may otherwise have knowledge or information. The City shall either approve or disapprove of such change within 15 days of receipt of such written notice , which approval shall not be unreasonably withheld . This Agreement may be terminated by the City or the City may exercise any other remedy available to the City under the terms of this Agreement, prior to the Project Completion Date, if there is any Transfer, whether voluntary or involuntary, in membership, ownership, management or control of the Developer (other than such changes occasioned by the death or incapacity of any individual) 55575.18175\40908266.11

6 that has not been approved in writing by the City, prior to the time of such Transfer pr ovided, however, that (i) the City shall first notify the Developer in writing of its intention to terminate this Agreement or to exercise any other remedy, and (ii) the Developer shall have thirty (30) calendar days following its actual receipt of such wr itten notice to commence and, thereafter, diligently and continuously proceed to cure the default of the Developer and submit evidence of the initiation and satisfactory completion of such cure to the City, in a form and substance reasonably satisfactory to the City. Except as expressly permitted in this Agreement, the Developer represents and agrees that it has not made and will not create or suffer to be made or created, any Transfer, either voluntarily, involuntarily or by operation of law, without the prior written approval of the City, until after the Project Completion Date. Any Transfer made in contravention of this Section shall be voidable at the election of the City and, if voided, shall be deemed to be an event of default by the Developer, whether or not the Developer knew of or participated in such Transfer.

Section 2.2. Effective Date. This Agreement is dated as first written above for reference purposes only. This Agreement shall not become effective until the date on which all of the following are true (“Effective Date”): (i) this Agreement is approved and executed by the appropriate authorities of Developer and delivered to City; (ii) Developer has delivered to City a certified copy of the official action taken by all of the managers or members of the Developer approving this Agreement, in a form satisfactory to City; (iii) following all legally required notices and hearings, this Agreement is approved by the City Council; and (iv) this Agreement is executed by the authorized representatives of City.

ARTICLE III

PROJECT FINANCING
Section 3.1. Evidence of Financing . Developer shall submit sufficient evidence of financing or self-financing for the civil work on the Project within 60 days of the Effective Date of this Agreement . The evidence shall be in a form reasonably acceptable to the City Attorney.

Thereafter, Developer commits to providing sufficient evidence of financing or self-financing for each of the phases, as more fully set forth in Attachment B, within one hundred and twenty (120) days of a Building Permit “ready to issue” letter being issued by the City for a particular phase referenced herein. The City shall issue a Building Permit upon Developer obtaining financing or self-financing based upon a Building Permit “ready to issue” letter, paying the associated fees and any satisfaction of any other conditions identified in the “ready to issue” letter.

Section 3.2. Unauthorized Liens. Except as provided above, until recordation of the Certificate of Completion, the Developer shall not record, and shall not allow to be re corded, against the Property, or any portion thereof, any liens not expressly authorized by this Agreement.

Until recordation of the Certificate of Completion, the Developer shall bond, remove, or shall have removed, any unauthorized lien made or recorde d against the Property or any portion of the Property, or shall assure the satisfaction thereof to the satisfaction of the City. After one hundred twenty (120) calendar days prior written notice to the Developer, the City shall have the right, but not the obligation, to satisfy any unauthorized lien made or recorded prior to recordation of the Certificate of Completion and receive reimbursement from the Developer for any amounts paid or incurred in satisfying any such lien, upon demand. Nothing in this Sec tion shall require the Developer to pay or make provisions for the payment of any tax, assessment, lien, or charge that the Developer is in the process of contesting the validity or amount thereof, in good faith, and so 55575.18175\40908266.11

7 long as such contest shall not subje ct the Property, or any portion thereof, to forfeiture or sale.

Moreover, so long as Developer provides a bond if an unauthorized lien is filed, Developer shall not be in default of this Agreement. For the avoidance of any doubt, as of the Effective Date, there are no mechanics liens on the Property. However, Developer anticipates deeds of trust being recorded to secure financing.

Section 3.3. Rights of Lenders and City Regarding Permitted Loans and Liens. The City shall have the right of reasonable review and approval of any Letter of Intent (“LOI”) with any Lender from which the Developer proposes to obtain any Loan to be secured by a Lien against the Property or any portion thereof. The review of the LOI must occur within fifteen (15) days of receipt by the City of the LOI and any reasonably requested information the City reasonably deems necessary to evaluate the LOI and City shall communicate its approval, disapproval, or conditional approval by email to Developer or the condition is waived by th e City. The City shall not unreasonably withhold, condition or delay its approval of any proposed Lender or Loan. In deciding whether to give, condition or withhold such approval, the City may consider, among other matters, whether or not the proposed Len der is a state or federally chartered bank, savings and loan, or other financial institution which routinely provides construction financing to development projects such as the Project, whether the terms of the Loan as reflected in the LOI are reasonable and customary when compared to the financing terms of similar development projects in the County, the size and financial strength of the proposed Lender, and what effect, if any, any changes requested by the Lender to either this Agreement or any of the attachments to this Agreement may have upon the City’s rights and remedies hereunder. In connection therewith, in any notice requesting approval of a proposed Lender and Loan, the Developer shall include a statement identifying any amendments, modifications, or other changes to this Agreement or its attachments which the proposed Lender will request in connection with the Developer’s obtaining of the Loan.

The City agrees to reasonably consider, but shall not be obligated to accept, any amendment, modification, or other change to this Agreement or any of the attachments to this Agreement which materially restricts, diminishes, or burdens the City’s rights and remedies. If the terms of the LOI are materially changed following the City’s approval of the LOI, De veloper shall submit the new deal terms to the City and City shall have seven (7) days to review and approve the materially different terms. .

3.3.1 Entitlements. Developer has presented to City staff and the City Council for review and entitlement the Project (collectively, the “Plans and Specifications”). The approval of the Plans and Specifications in accordance with the Schedule of Performance , Attachment B, requires approval of City Council . Such required approvals include appropriate analysis required under California Environmental Quality Act, Public Resources Code Sections 21000, et seq. (“CEQA”) for any and all Project entitlements. The Developer obtains no right to develop the Project on the Property or any portion of the Property by virtue of this Agreement alone. If any revisions of the Scope of Development are required by a Governmental Agency (other than the City) having jurisdiction over the Property or the Project, the Developer shall promptly make any such revisions that are generally consistent with the Scope of Development. Developer will construct the Project in Phases as described in detail in the Scope of Development.

3.3.2 Developer Covenant to Undertake Project . The Developer covenants, for itself, its successors, and assigns, that , subjec t to Unavoidable Delays (as hereinafter defined) the Developer shall commence construction of the Project in accordance with 55575.18175\40908266.11

8 the Schedule of Performance, attached hereto as Attachment B and incorporated herein for all purposes ( “Schedule of Performance ”), and thereafter shall diligently proceed to complete construction of each Phase of the Project in a good and workmanlike manner in substantial conformity with the approved Plans and Specifications, except for such changes not constituting minor field revisions (defined below) as may be mutually agreed upon in writing by and among the Parties, and in compliance with all applicable laws, regulations, orders and conditions of any and all courts, boards, agencies, commissions, offices, or authorities of any nature whatsoever for any governmental unit (federal, state, county, district, municipal, city, or otherwise) whether now or later in existence (“Governmental Agency”) with jurisdiction over the Property or the Project.

After commencement of the work on the Project, the Developer shall not permit such work to cease or be suspended for a time period in excess of forty-five (45) consecutive calendar days, subject to Unavoidable Delays. The Parties agree that time is of the essence in the performance of this Agreement, including, without limitation, the Schedule of Performance, and the satisfaction of conditions precedent considering the large investment of resources that all Parties recognize will be required for the development of the Project.

The developer will, promptly upon substantial completion of construction of each Phase of the Project, cause the Project to be inspected by each Governmental Agency with jurisdiction over that portion of the Project and shall correct any defects and deficiencies that may be disclosed by any such inspection and shall cause to be duly issued all occupancy certificates and other licenses, permits, and authorizations necessary for the operation and occupancy of the completed Project.

The Developer shall do and perform all of the foregoing acts and things and cause to be issued and executed all such occupancy certificates, licenses, and authorizations for the Project on or before the date set forth in the Sche dule of Performance as the completion date for each Phase of the Project, subject to Unavoidable Delays. The Developer shall obtain a Certificate of Completion (as hereinafter defined) on or before the date for each Phase completion established by the Schedule of Performance set forth in Attachment B.

Failure to comply with the time periods for each item on the Schedule of Performance, unless justified by Unavoidable Delays or an extension of time as provided for in this Agreement, shall be an event of Default under this Agreement.

The covenants of this Section shall run with the land of the Property until the earlier of the date of recordation of the final Certificate of Completion for the entire Project or the twenty-first (21st) anniversary of the date of the Effective Date and shall be incorporated in the Notice of Agreement (Attachment D) to be recorded against the Property immediately following the Effective Date of this Agreement.

3.3.3 Developer Attendance at City Meetings . The Developer agrees to have one or more of its employees or consultants who are knowledgeable regarding this Agreement and the development of the Project, such that such person(s) can meaningfully respond to Ci ty questions regarding the progress of the Project, attend City Council meetings, when requested to do so on not less than ten (10) days prior written notice by City staff. 55575.18175\40908266.11

9 3.3.4 Developer Changes to Plans and Specifications or Schedule of Performance During Course of Construction.

A. The Developer shall have the right during the course of construction of the Project to make “minor field revisions.” “Minor field revisions” shall be defined as detail changes from the approved Plans and Specifications that have no material impact on the Project or are made in order to expedite the work of construction in response to field conditions such as structural detail revisions or interior finish revisions. “Minor field revisions ” exclude material modifications to the Project, including the site plan and arc hitecture previously approved by the City pursuant to the Original Development Agreement. All “ minor field revisions ” must be documented and stamped by the licensed architect or licensed enginee r and/or other design professional as deemed necessary. Nothing contained in this Section shall be deemed to constitute a waiver of or change in any codes, statutes, ordinances, laws, permits, orders, and any rules and regulations promulgated thereunder of any Governmental Agency (“Governmental Requirements”) governing any such “minor field revisions” or in any approvals by any Governmental Agency otherwise required for any such “minor field revisions.” B. All work that does not meet the definition of a “minor field revision” shall be resubmitted as an amended set of construction documents to the City for its review and approval no less than fifteen (15) business days prior to the date that the Developer intends to implement such changes. The City shall have t welve (12) business days from its receipt of such proposed changes to review the same and advise the Developer in writing whether such changes are acceptable to the City in its reasonable discretion, or such changes will be deemed unacceptable to City; provided, however, any major changes, as determined by City in its reasonable discretion, may be subject to a rehearing for reapproval of the City Council, in its sole and absolute discretion.

C. Nothing contained in this section shall be deemed to constitute a waiver of or change in the City’s zoning, building, and land use regulations (whether contained in ordinances, the City ’s municipal code, conditions of approval, policies, practice or elsewhere) (collectively, the “City Requirements ”) governing “minor fi eld revisions” or other changes.

However, the Parties acknowledge that, based upon the date of completion of the application for the hotel tower and residential tower over the existing foundation it shall be subject to the 2016 building codes. The Parties have also acknowledged that, based upon the date of completion of the application for the residential units outside of the hotel tower and residential tower , the other residential units shall be subject to the 2022 building codes.

D. Any modification of a time or date for performance or satisfaction of a condition as set out in the Schedule of Performance that does not result in a change of more than ninety (90) days may be approved on behalf of the City by the City Manager, in his or her reasonable discretion. A modification of a time or date for performance or satisfaction of a condition of the Schedule of Performance (or a series of such modifications) that results in an aggregate change of more than ninety (90) days shall be subject to the approval of the City Council, in its sole and absolute discretion. If performance of a task or satisfaction of a condition in the Schedule of Performance is prevented or delayed by Unavoidable Delays, the deadline for completion of such task or satisfacti on of such condition shall be extended by the period of such Unavoidable Delays.
55575.18175\40908266.11

10 3.3.5 City’s Right to Inspect Project and Property . Officers, officials, employees, consultants, contractors, agents, and representatives of the City who are designated by the City Manager (“City Designees”) shall have the right of reasonable access to the Property, without the payment of charges or fees, during normal construction hours during the period of construction of the Project upon providing two business day prior written notice unless there is a health and safety issue. Any and all City Designees who enter the Property s hall identify themselves at the Developer’s construction management office on the Property upon City Designee’s entrance on to the Property and may, at Developer’s election, be accompanied by a representative of the Developer while on the Property. The Developer shall make a representative of the Developer available for this purpose at all times during normal construction hours, upon prior written notice from the City as provided for above. The City shall indemnify and hold the Developer harmless from injury, property damage , or liability arising out of the exercise by the City of the right of access to the Property provided in this section, other than injury, property damage, or liability arising from the negligence or willful misconduct of the Developer or its officers, employees, consultants, contractors, agents, representatives, or other parties engaged on its behalf. The City shall inspect re levant portions of the Property prior to issuing any written statements reflecting adversely on the Developer ’s compliance with the terms and conditions of this Agreement pertaining to development of the Project. If in the City ’s reasonable judgment it is necessary, the City shall have the further right, from time to time, to retain a consultant or consultants to inspect the Project and verify compliance by the Developer with the provisions of this Agreement. The Developer acknowledges and agrees that any such inspections are for the sole purpose of protecting the City ’s rights under this Agreement, are made solely for the City ’s benefit, that the inspections may be superficial and general in nature, and are for the purposes of informing the City of the progress of the Project and the conformity of the Project with the terms and conditions of this Agreement, and that the Developer shall not be entitled to rely on any such inspection(s) as constituting an approval, satisfaction or acceptance of any materials , workmanship, or conformity of the Project with this Agreement or otherwise. The Developer agrees to make its own regular inspections of the work during construction of the Project to determine that the quality of the Project and all other requirements of the work for the Project are being performed in a manner satisfactory to the Developer. The Developer also agrees to promptly notify the City in writing should the Developer ’s inspections show any matters that will prevent the entire Project from being c ompleted by the date for Project Completion set forth therefore in the Schedule of Performance. The Developer will use commercially reasonable efforts to cause all contractors, subcontractors , and materialmen to cooperate with the City to enable such examination.

3.3.6 Developer to Pay All Costs and Expenses . The Parties agree that the City shall not provide any financial assistance to the Developer in connection with the Project except as may be expressly set forth in this Agreement (e.g., the TOT rebate as set forth in Recital C infra.) The Developer shall be solely responsible for paying for any and all (i) costs of design work, construction, inspection, plan check, impact fees, labor, materials, and fees and permit expenses associated with the Project; (ii) fees pertaining to the review and approval of the Project by the City, any other Governmental Agency and utility service providers, including the costs of obtaining entitlements and the preparation of all required construction, planning, and other documents reasonably required by a Governmental Agency pertinent to the development or operation of the Project on the Property, including, but not limited to, specifications, drawings, plans, maps, permit applications, land use applications, zoning applications, environmental review 55575.18175\40908266.11

11 and disclosure documents and design review documents; and (iii) costs of design, construction, relocation, and securing of permits for sewer or utility improvements and connections that may be required in development of the Project, whether located on or off of the Property. The Developer shall obtain any and all necessary approvals, prior to the commencement of applicable portions of construction, and the Developer shall take reasonable precautions to ensure the safety and stability of surrounding properties during said construction.

Developer shall be responsible for its costs, including the following:

A. All reasonable fees or expenses of engineers, architects, financial consultants, legal, planning, or other consultants or contractors retained by the Developer for any study, analysis, evaluation, report, schedule, estimate, environmental review, planning and/or design activities, drawings, specifications, or other activity or matter relating to the Property or the Project, including the negotiation and drafting of this Agreement, that may be undertaken by the Developer; and
B. All reasonable fees, charges, and costs related to and making all deposits and providing all bonds or other security associated with the submission to and processing by the City of any and all applications and other documents and information to be submitted to the City by the Developer pursuant to this Agreement or otherwise associated with the Project.

The Developer shall obtain all entitlements, permits, and other approvals for use and development of the Project on the Property from each Governmental Agency, within the time period for such action s specifically set forth in the Schedule of Performance , subject to any extensions of time authorized by this Agreement upon the occurrence of an Unavoidable Delay (hereinafter defined).

Notwithstanding the foregoing, provided Developer constructs the Project in compliance with the approved Entitlements and the Schedule of Performance, subject to any Unavoidable Delays and as may be amended as provided herein, Developer shall be entitled to participate in the City’s Hotel Operation Incentive Program pursuant to the Amended and Restated Operation Covenant Agreement No. 6642, dated November 15, 2017.

3.3.7 Prevailing Wages.

A. The Developer acknowledges that th e City has not made any representation, express or implied, to the Developer or any person associated with the Developer regarding whether or not laborers employed relative to the construction of the Project must be paid the prevailing per diem wage rate f or their labor classification, as determined by the State of California, pursuant to Labor Code Sections 1720, et seq. The Developer agrees it shall assume the responsibility and be solely responsible for determining whether or not laborers employed relative to the construction of the Project must be paid the prevailing per diem wage rate for their labor classification. If construction of certain improvements related to the Project are considered a public work for purposes of State law, Developer shall be required to (i) pay and cause its contractor and subcontractors to pay prevailing wages for construction of the improvements as those wages are determined pursuant to Labor Code Section 1720 et seq.; (ii) implement 55575.18175\40908266.11

12 regulations of the Department of Industr ial Relations; and (iii) comply with the other applicable provision s of Labor Code Section 1720 et seq.

B. The Developer, on behalf of itself, its successors, and assigns, hereby waives and releases the City from any right of action that may be available to it pursuant to Labor Code Sections 1726 and 1781. The Developer acknowledges the protections of Civil Code Section 1542 relative to the waiver and release contained in this Section 3.3.7, which reads 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 KNOW N BY HIM OR

HER, WOULD HAVE MATERIALLY AFFECTED HIS OR HER
SETTLEMENT WITH THE DEBTOR OR RELEASED PARTY.”

BY INITIALING BELOW, THE DEVELOPER KNOWINGLY AND
VOLUNTARILY WAIVES THE PROVISIONS OF SECTION 1542 SOLELY IN CONNECTION WITH THE WAIVERS AND RELEASES OF THIS SECTION. _________________
Developer’s Initials
C. Additionally, the Developer shall indemnify, defend with counsel acceptable to the City, and hold the City harmless against any claims pursuant to Labor Code Sections 1726 and 1781 arising from this Agreement or the construction or operation of all or any portion of the Project.

3.3.8 Certificate of Completion.

A. Following the substantial completion of construction of each Phase of the Project as reflected in Attachment B , and upon written request from the Developer for certification of City that the construction of the Project has been substantially completed in compliance with the terms and conditions of this Agreement (“Certificate of Completion”), the City shall promptly inspect the Phase to determine whether or not the Project has been substantially completed in compliance with this Agreement. If the City determines that the Project is substantially complete and in substantial compliance with this Agreement, the City Manager shall promptly furnish the Developer with a Certificate of Completion for the Phase. If the City determines that the Phase is not in substantial compliance with this Agreement, the City Manager shall send written notice of each substantial non-conformity to the Developer. U pon issuance of the final certificate of occupancy for the development of the Project, based on the plans submitted by the Developer to the City, the City shall, upon written request of Developer, furnish the Developer with a Certificate of Completion for the Project.

B. The City shall not unreasonably withhold the issuance of a Certificate of Completion. A Certificate of Completion shall be evidence of the City’s conclusive determination of satisfactory completion of the Phase to which it pertains pursuant to the terms of this Agreement. Such Certificate of Completion shall be in such form as to permit it to be recorded 55575.18175\40908266.11

13 in the Office of the County Recorder of Riverside County. After the recordation of a Certificate of Completion for the Phase, any person then owning or thereafter purchasing, leasing, or otherwise acquiring any interest in the Property improved with the Phase shall not (because of such ownership, purchase, lease, or acquisition) incur any obligation or liability under this Agreement regarding construction or installation of the Project except that such person shall be bound by any reservations, covenants, conditions, restrictions, and other interests recorded against the Property pursuant to this Agreement.

C. If the City fails or refuses to issue a Certificate of Completion following written request from the Developer, the City shall, within ten (10) calendar days of the Developer’s written request or within three (3) calendar days after the next regular meeting of the City Council, whichever date occurs later, provide the Developer with a written statement setting forth the reasons for the City’s failure or refusal to issue a Certificate of Completion. The statement shall also contain the City’s opinion of the action(s) the Developer must take to obtain a Certificate of Completion from the City. If the City shall have failed to provide such written statement within said period, the Developer shall issue a second written request to the City to issue a Certificate of Completion. If the City shall have failed to provide such written statement within five (5) calendar days of the Developer’s second written request, the Developer shall be deemed entitled to the Certificate of Completion. If the reason for the Developer’s failure to complete the Phase is confined to the immediate unavailability of specific items or materials for construction or landscaping at a price reasonably acceptable to the Developer or other minor building “punch-list” items, the City may issue its Certificate of Completion upon the posting of a bond or irrevocable standby letter of credit by the Developer in a form reasonably acceptable to the City in an amount representing the mutually agreed upon fair value of the work on the Phase remaining to be completed..

D. A Certificate of Completion shal l not constitute evidence of compliance with or satisfaction of any obligation of the Developer to any holder of a mortgage, or any insurer of a mortgage securing money loaned to finance the Phase or Project, or any parts thereof. A Certificate of Complet ion shall not be deemed to constitute a notice of completion under Sections 8182 or 9204 of the California Civil Code, nor shall it act to terminate the continuing covenants, restrictions, or conditions contained of any instruments recorded against the Property pursuant to this Agreement. A Certificate of Completion is not evidence of the compliance of the Phase or Project with any City Requirements or any building code, conditions of approval, land use, zoning, or other requirements of the City or any Governmental Agency with jurisdiction over the Property, other than the City

3.3.9 Unavoidable Delays. P erformance by any Party under thi s Agreement shall not be deemed or considered to be in default where any such default is due to any delay that is caused by an event that is beyond the reasonable control of the City or the Developer, including, but not limited to, delay caused by strikes, acts of God (including, without limitation, tornadoes, floods, hurricanes, earthquakes) , war, weather, inability to obtain labor or materials, inability to obtain governmental permits or approvals, governmental restrictions, civil commotion, acts or campaigns of terrorism or sabotage, embargoes, interruptions to financial markets or to domestic or internation al transportation to/from the United States for one month or longer, epidemics, pandemics, riots, fire or similar causes, but excluding general economic conditions or changes in the economic assumptions of either Party that may have provided a basis for en tering 55575.18175\40908266.11

14 into this Agreement and that occur at any time after the execution of this Agreement (“Unavoidable Delays”). Each Party expressly assumes the risk that changes in general economic conditions or changes in such economic assumptions relating to the terms and covenants of this Agreement could impose an inconvenience or hardship on the continued performance of such Party under this Agreement and such economic conditions or assumptions do not constitute an Unavoidable Delay and do not provide any Party with grounds for asserting the existence of an Unavoidable Delay in the performance of any covenant or undertaking arising under this Agreement.

An extension of time for any Unavoidable Delay shall be for the period of the Unavoidable Delay and shall commenc e from the date of occurrence of the Unavoidable Delay .

The Party asserting the existence of the Unavoidable Delay shall provide the other Part y with written notice of the occu rrence of the Unavoidable Delay within thirty (30) days of the commencement of such asserted Unavoidable Delay , but the extension of time shall commence from the date identified as to the occurrence of the Unavoidable Delay and not the date of the notice. If the notice is not received within the thirty (30) days then the extension of time shall commence on the date of receipt of the written notice.

The Parties agree and acknowledge that there is no existing Unavoidable Delay as of the Effective Date of this Agreement.

Section 3.4. Developer Covenants.

3.4.1 Covenant to Maintain Property on Tax Rolls. The Developer , for itself, its successors, and assigns, as to all or any part or portion of the Property and/or the Project, covenants and agrees that:

A. The entire Property shall remain on the County of Riverside, California (“County”) secured real property tax rolls for the thirty (30) calendar years following the issuance of any certificate of occupancy for the Project.

B. The Developer shall pay all property tax bills with respect to the Property and all improvements thereon on or before the last day for the timely payment of each property tax installment on each December 10 and April 10 during such time period and to timely pay all supplemental tax bills regarding the Property issued by the County until such time as any residential portion of the Property is sold. The Developer further covenants and agrees to provide to the City, on or before July 31 of each year, commencing in the calendar year following the calendar year in which a Certificate of Completion for the Project is recorded and in each calendar year, thereafter, for the full thirty (30) year term of this covenant: (i) a true and correct copy of all property tax assessment notices, property tax bills and property tax assessment correspondence by and between the Developer and the County regarding the Property and all improvements thereon, with respect to the preceding fiscal year of the County, and (ii) cancelled checks issued by the Developer in payment of all property tax payments that are made to the County regarding the Property and all improvements thereon (or other reasonably acceptable evidence of such payment), with respect to the preceding fiscal year of the County. As noted above, upon the sale of any portion of the Property, e.g. , to future condominium owners, the Developer’s obli gation to pay property taxes shall cease. Upon the sale of the Hotel Tower property, this covenant shall remain in full force and effect and be binding on the successor in interest or assignee. 55575.18175\40908266.11

15 The covenants of this Section shall run with the land of the Property, shall be enforceable against the Developer and its successors and assigns.

3.4.2 Sales Tax and Transient Occupancy Tax.

A. Developer and City anticipate that Developer shall be open for business and generating sales tax collected pursuant to the Bradley -Burns Uniform Local Sales and Use Ta x Law (Revenue and Taxation Code Section 7200, et seq.) (“Sales Tax Law”) and Transient Occupancy Tax (“TOT”) upon the opening for occupancy by revenue paying guests of the Project. As set forth, it is anticipated that there will be between 150-160 TOT generating hotel rooms that are subject to TOT rebates and no less than 28 residential units in the hotel tower which will be short term rental eligible , TOT generating, and subject t o TOT rebates in the Project . If Developer has not commenced generating Sales Tax and TOT 90 days following the completion of all phases of the Project as fully set forth on Attachment B, Developer, its successors or assigns shall pay to the City, in lieu of payment of such taxes, $1000 per day until such time as the hotel is opened for occupancy.

B. The covenants of this Section shall run with the land of the Property and shall be enforceable against the Developer and its successors and assigns.

3.4.3 Maintenance Condition of the Property . The Developer for itself, its successors, and assigns, as to all or any part or portion of the Property and/or the Project, covenants, and agrees that:

A. The areas of the Property that are subject to public view (including all exis ting and future improvements, paving, walkways, landscaping, exterior signage and ornamentation) shall be maintained in good repair and a neat, clean, and orderly condition, ordinary wear and tear excepted. To that end, Developer is committed to do the following, among other things: (1) maintenance of the perimeter fence; (2) maintenance of a decorative fence cover upon completion of the site work; (3) installation of temporary sensor lighting upon completion of the site work and installation of electricit y to the site; (4) installation of CCTV cameras and monitoring on the site , completion of the site work and installation of electricity on the site ; (5) explore the feasibility and constructability of landscaping the area immediately in front of the fence on East Amado Road; and (6) operate a phone line that is available to the public to contact if there are security or other issues associated with the development which will be staffed during normal business hours and any message will be returned within twe nty-four hours . If there is an occurrence of an adverse condition on any area of the Property that is subject to public view in contravention of the general maintenance standard described above (a “Maintenance Deficiency”), then the City shall notify the Developer in writin g of such Maintenance Deficiency. If the Developer fails to cure or commence and diligently pursue to cure the Maintenance Deficiency within thirty (30) days of Developer’s receipt of notice of the Maintenance Deficiency, the City shall have the right to enter the Property and perform all acts necessary to cure the Maintenance Deficiency, or to take any other action at law or in equity that may then be available to the City to accomplish the abatement of the Maintenance Deficiency. Any sum expended by the City for the abatement of a Maintenance Deficiency on the Property pursuant to this Section shall become a lien on the Property, as applicable. If the amount of the lien is not paid within thirty (30) days 55575.18175\40908266.11

16 after written demand for payment from the City to the Developer, the City shall have the right to enforce the lien in the manner provided in Section 3.5.3.

B. Graffiti, as this term is defined in Government Code Section 38772, that has been applied to any exterior surface of a structure or improvement on the Property that is visible from any public right-of-way adjacent or contiguous to the Property, shall be removed by the Developer by either painting over the evidence of such vandalism with a paint that has been color-matched to the surface on which the pa int is applied, or graffiti may be removed with solvents, detergents or water, as appropriate. If any such graffiti is not removed within five (5) business days following the time of the discovery of the graffiti, the City shall have the right to enter the Property and remove the graffiti, without notice to the Developer. Any sum reasonably expended by the City for the removal of graffiti from the Property pursuant to this Section 3.5.3, shall be a lien on the Property. If the amount of the lien is not p aid within thirty (30) days after written demand to the Developer from the City, the City shall have the right to enforce its lien in the manner provided below.

C. The Parties further mutually understand and agree that the rights conferred upon the City under this Section expressly include a grant by the Developer of a security interest in the Property with the power to establish and enforce a lien or other encumbrance against the Property or any portion thereof, in the manner provided under Civil Code Section s 2924, including particularly Sections 2924b and 2924c, to secure the obligations of the Developer and it successors under this Section 3.5.3(A) and (B). above, including the reasonable attorneys’ fees and costs of the City associated with the abatement of a Maintenance Deficiency or removal of graffiti.

For the purposes of the preceding sentence the words “reasonable attorneys’ fees and costs of the City” mean and include the hourly rate charged by the City Attorney to the City, and costs of the City Attorney, and the lawyers employed in the Office of the City Attorney and the costs and expenses for any outside counsel retained by City.

D. The provisions of this Section shall run with the land of the Property and shall be enforceable against the Developer an d its successors and assigns. Nothing in the foregoing provisions of this Section shall be deemed to preclude the Developer from making any alteration, addition, or other change to any structure or improvement or landscaping on the Property, provided that any such changes comply with the Plans and Specifications and any applicable zoning and building regulations of the City.

3.4.4 No Discrimination or Segregation. The Developer covenants by and for itself, its successors, and assigns, as to all or any part or p ortion of the Property and/or the Project, covenants, and agrees that:

A. There shall be no discrimination against or segregation of any person or group of persons, on account of any basis listed in subdivision (a) or (d) of Section 12955 of the Government Code, as those bases are defined in Sections 12926, 12926.1, subdivision (m) and paragraph (1) of subdivision (p) of Section 12955, and Section 12955.2 of the Government Code, in the sale, lease, sublease, transfer, use, occupancy, tenure, or enjoyment of th e Property nor shall the Developer, itself, or any Person claiming under or through it, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use, or occupancy, of tenants, lessees, subtenants, sublessees, or vendees in the Property. 55575.18175\40908266.11

17 B. Notwithstanding the foregoing Subsection A Error! Reference source not found., with respect to familial status, Subsection A above shall not be construed to apply to housing for older persons, as defined in Section 12955.9 of the Government Code and shall not be construed to affect Sections 51.2, 51.3, 51.4, 51.10, 51.11, and 799.5 of the Civil Code, relating to housing for senior citizens. Subdivision (d) of Section 51 and Section 1360 of the Civil Code and subdivisions (n), (o), and (p) of Section 12955 of the Government Code shall apply to Subsection A above.

C. The covenant of this Section shall run with the land of the Property in perpetuity and shall be enforceable against the Developer and its successors and assigns.

3.4.5 Covenant to Maintain Project. The Developer shall cause the Hotel to be operated pursuant to an operating and/or management agreement with an operator qualified to operate a Dream -branded hotel or any other nationally -recognized qualified operator or management company. City approves Hyatt Hotels Corporation which through a wholly -owned subsidiary owns the “Dream” b rand and will manage the Hotel. The Developer covenants to the City that the Project shall continuously be operated as a hotel for the thirty (30) years immediately following the date of issuance of a final certificate of occupancy by the City for the Project. The Developer may submit a written request to the City for approval to change the name, flag, or brand of the Project to another national hotel franchise name, flag, or brand. Any such request to change the name, flag, or brand of the Project shall be accompanied by a detailed statement of the reasons for the proposed change and a hotel franchise agreement executed by both the Developer and the proposed new national hotel franchisor, contingent upon the City ’s approval of the Developer ’s request. The City may approve or disapprove any request from the Developer to change the name, flag, or brand of the Hotel in the City ’s reasonable discretion. However, the City’s approval of a change in the name, flag, or brand of the Hotel shall not be unreasonably delayed, conditioned or withheld if the new name, flag, or brand of the Hotel is that of a nationally-recognized name, flag or brand of a comparable or better quality Hotel. Any approval or disapproval of a change in the name, flag, or brand of the Hotel by the City shall be in writing. The covenant of this Section shall run with the land of the Property and shall be enforceable against the Developer and its successors and assigns.

3.4.6 Developer Covenant to Defend this Agreement . The Developer acknowledges that the City is a “public entity” and/or “public agency” as defined under applicable California law. Therefore, the City must satisfy the requirements of certain California statutes relating to the actions of public entities and public agencies including, without limitation, CEQA.

Also, as a public body, the City ’s action in approving this Agreement may be subject to proceedings to invalidate this Agreement or mandamus. The Developer assumes the risk of delays and damages tha t may result to the Developer from any third -party legal actions related to the City’s approval of this Agreement or the pursuit of the activities contemplated by this Agreement, even in the event that an error, omission, or abuse of discretion by the City is determined to have occurred. If a third-party files a legal action regarding the City’s approval of this Agreement or the pursuit of the activities contemplated by this Agreement, the City may terminate this Agreement on thirty (30) days written notice to the Developer of the City’s intent to terminate this Agreement, referencing this Section 3.5.6, without any further obligation to perform the terms of this Agreement and without any liability to the Developer resulting from such termination, unless the Developer unconditionally agrees to indemnify and defend the City, with legal counsel chosen by 55575.18175\40908266.11

18 Developer and acceptable to the City, against such third -party legal action, as provided below. If the City elects to terminate this Agreement, the Purchase and Sale Agreement between City and CDI Ventures, LLC and all amendments thereto shall remain in full force and effect. Within thirty (30) days of receipt of the City’s notice of intent to termin ate this Agreement, as provided in the preceding sentence, the Developer may offer to defe nd the City, with legal counsel acceptable to the City, in the third -party legal action and pay all of the court costs, attorney fees, monetary awards, sanctions, att orney fee awards, expert witness and consulting fees, and the expenses of any and all financial or performance obligations resulting from the disposition of the legal action.

Any such offer from the Developer must be in writing and reasonably acceptable t o the City in both form and substance. Nothing contained in this Section shall be deemed or construed to be an express or implied admission that the City is liable to the Developer or any other person or entity for damages alleged from any alleged or established failure of the City to comply with any statute, including, without limitation, CEQA. The covenants of this Section shall run with the land of the Property and shall be enforceable against the Developer and its successors and assigns.

3.4.7 Environmental Indemnity of the City by the Developer . The Developer agrees, at its sole cost and expense, to fully indemnify, protect, hold harmless, and defend (with counsel selected by the Developer and approved by the City , in its reasonable discretion) the City and its official, officers , attorneys, employees, agents, and authorized representatives (collectively, the “Indemnified Parties ”), from and against any and all claims, demands, damages, losses, liabilities, obligations, penalties, fines, actions, causes of a ction, judgments, suits, proceedings, costs, disbursements and expenses, including, without limitation, reasonable attorney fees, disbursements and costs of attorneys, environmental consultants , and other experts, and all foreseeable and unforeseeable damages or costs of any kind or of any nature whatsoever (collectively, “Environmental Claims ”) that may, at any time, be imposed upon, incurred, or suffered by, or claimed, asserted, or awarded against the Indemnified Parties, directly or indirectly relating to or arising from any of the following “Environmental Matters” existing or occurring during or arising from the Developer ’s ownership of the Property or construction or operation of the Project:

A. The presence of Hazardous Materials (hereinafter defined) on, in, under, from, or affecting all or any portion of the Property or the Project.

B. The storage, holding, handling, release, threatened release, discharge, generation, leak, abatement, removal, or transportation of any Hazardous Materials on, in, under, from or affecting the Property or the Project.

C. The violation of any law, rule, regulation, judgment, order, permit, license, agreement, covenant, restriction, requirement , or the like by the Developer, its agents , representatives, contractors, or other parties engaged on its behalf relating to or governing in any way Hazardous Materials on, in, under, from, or affecting the Property or the Project.

D. The failure of the Developer, its agents, representatives, contractors, or other parties engaged on its behalf, to properly complete, obtain, submit and/or file any and all notices, permits, licenses, authorizations, covenants , and the like in connection with the Developer’s activities on the Property or regarding the Project relating to Hazardous Materials. 55575.18175\40908266.11

19 E. The implementation and enforcement by the Developer, its agents , representatives, contractors, or other parties engaged on its behalf of any monitoring, notification, or other precautionary measures that may, at any time, become necessary to protect against the release, potential release, or discharge of Hazardous Materials on, in, under, from, or affecting the Property or the Project.

F. The failure of the Developer, its agents, representatives, contractors, or other parties engaged on its behalf , in compliance with all applicable Environmental Laws (hereinafter defined) , to lawfully remove, contain, transport , or dispose of any Hazardous Materials existing, stored or generated on, in, under, or from the Property or the Project.

G. Any investigation, inquiry, order, hearing, action , or other proceeding by or before any governmental agency in connection with any Hazardous Materials on, in, under, from, or affecting the Property or the Project or the violation of any Environmental Law relating to the Property or the Project.

H. The Developer shall pay to the Indemnified Parties all costs and expenses including, without limitation, reasonable attorneys ’ fees and costs, incurred by the Indemnified Parties in connection with enforcement of the aforementioned environmental indemnity.

I. “Hazardous Materials” as used in this Agreement shall mean and refer to, without limitation, substances defined as a “hazardous substance,” “hazardous material,” “toxic substance, ” “solid waste, ” or “pollutant o r contaminate ” in the Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended, 42 U.S.C.

Sections 9601, et seq.; the Toxic Substances Control Act ( “TSCA”) [15 U.S.C. Sections 2601, et seq.]; the Hazardous Materials Transportation Act, 49 U.S.C. Sections 1801, et seq.; the Resource Conservation and Recovery Act, 42 U.S.C. Sections 6901, et seq.; those substances listed in the United States Department of Transportation (DOT)Table [49 CFR 172.101], or by the EPA, or any successor authority, as a Hazardous Substance [40 CFR Part 302]; and those substances defined as “hazardous waste ” in Section 25117 of the California Health and Safety Code or, as a “Hazardous Substance ” in Section 25316 of the California Health and Safety Code; other substances, materials, and wastes that are, or become, regulated or classified as hazardous or toxic under federal, state, or local laws or regulations and in the regulations adopted pursuant to said laws, and shal l also include manure, asbestos, polychlorinated biphenyl, flammable explosives, radioactive material, petroleum products, and substances designated as a hazardous substance pursuant to 33 U.S.C. Section 1321 or listed pursuant to 33 U.S.C. Section 1317.

J. “Environmental Laws ” as used in this Agreement shall mean all federal, state, local, or municipal laws, rules, orders, regulations, statutes, ordinances, codes, decrees, or requirements of any government authority regulating, relating to, or imposing liability of standards of conduct con cerning any Hazardous Material, or pertaining to occupational health or industrial hygiene (and only to the extent that the occupational health or industrial hygiene laws, ordinances, or regulations relate to hazardous substa nces on, under, or about the Property, occupational or environmental conditions on, under, or about the Property, as now or may at any later time be in effect, including without limitation, the Comprehensive Environmental Response, Compensation and Liabili ty Act of 1980 ( “CERCLA”) [42 USC Section 9601 et seq.]; the - -- 55575.18175\40908266.11

20 Resource Conservation and Recovery Act of 1976 (“RCRA”) [42 USC Section 6901 et seq.]; the Clean Water Act, also known as the Federal Water Pollution Control Act ( “FWPCA”) [33 USC Section 1251 et seq.]; the Toxic Substances Control Act (“TSCA”) [15 USC Section 2601 et seq.]; the Hazardous Materials Transportation Act ( “HMTA”) [49 USC Section 1801 et seq.]; the Insecticide, Fungicide, Rodenticide Act [7 USC Section 6901 et seq.] the Clean Air Act [42 USC Section 7401 et seq.]; the Safe Drinking Water Act [42 USC Section 300f et seq.]; the Solid Waste Disposal Act [42 USC Section 6901 et seq.]; the Surface Mining Control and Reclamation Act [30 USC Section 101 et seq.] the Emergency Planning and Comm unity Right to Know Act [42 USC Section 11001 et seq.]; the Occupational Safety and Health Act [29 USC Section 655 and 657]; the California Underground Storage of Hazardo us Substances Act [California Health & Safety Code Section 25288 et seq.]; the California Hazardous Substances Account Act [California Health & Safety Code Section 25300 et seq.]; the California Safe Drinking Water and Toxic Enforcement Act [California Health & Safety Code Section 24249.5 et seq.] the Porter-Cologne Water Quality Act [California Water Code Section 13000 et seq.] together with any amendments of or regulations promulgated under the statutes cited above and any other federal, state, or local law, statute, ordinance, or regulation now in effect or later enacted th at pertains to occupational health or industrial hygiene, and only to the extent the occupational health or industrial hygiene laws, ordinances, or regulations relate to hazardous substances on, under, or about the Property, or the regulation or protection of the environment, including ambient air, soil, soil vapor, groundwater, surface water, or land use.

Section 3.5. Insurance. In order to protect the City and its council members, officials, officers, employees, attorneys, contractors, agents, and authorized representatives (collectively, “Additional Insureds”) against any and all claims and liability for death, injury, loss , and damage resulting from the Developer ’s actions in connection with this Agreement, the Property, and the Project, the Developer shall secure and maintain the insurance coverage, described in and required by this Section. The City shall not have any obligation under this Agreement until the Developer provides the required policies and/or certificates evidencing the insurance required by this Section to the City and the City approves such evidence of insurance. The Developer shall pay any deductibles and self -insured retentions under all insurance policies issued in satisfaction of the terms of this Agreement. Developer shall retain all insuran ce policies as set forth in this Section until issuance of the Certificate of Completion.

Section 3.6. Workers’ Compensation Insurance Requirement . The Developer shall submit written proof that the Developer is insured against liability for workers ’ compensation in accordance with the provisions of Section 3700 of the Labor Code. By executing this Agreement, the Developer makes the following certification, required by Section 1861 of the Labor Code:
“I am aware of the provisions of Section 3700 of the Labor Code whic h require every employer to be insured against liability for workers ’ compensation or to undertake self -insurance in accordance with the provisions of that code, and I will comply with such provisions before commencing the performance of the work of this contract.” The Developer shall require each contractor and sub -contractor performing work on the Project to provide workers’ compensation coverage for all of such contractor’s or sub-contractor’s employees, unless the contractor ’s or sub-contractor’s employees are covered by workers ’ 55575.18175\40908266.11

21 compensation insurance provided by the Developer. If any class of employees engaged in work or services performed in connection with the Project is not covered by Labor Code Section 3700, the Developer shall provide and/or require each contractor or sub -contractor to provide adequate workers’ compensation insurance covering such employees. Each workers’ compensation policy procured pursuant to this section shall contain a full waiver of subrogation clause in favor of the Additional Insureds.

Section 3.7. Liability and Permanent Insurance Requirements.

A. The Developer shall maintain in full force and effect, until the issuance of the Certificate of Completion the following insurance coverage:

1. Commercial General Liabili ty Insurance coverage,
including, but not limited to, Premises -Operations, Contractual Liability Insurance (specifically covering all indemnity obligations of the Developer pursuant to this Agreement), Products - Completed Operations Hazards, Personal Injury (including bodily injury and death), and Property Damage for liability arising out of the construction of the Project and/or the Developer’s operations concerning the Property or the Project. The commercial general liability insurance coverage shall have minimum limits for Bodily Injury and Property Damage liability of TWO MILLION DOLLARS ($2,000,000) each occurrence and FOUR MILLION DOLLARS ($4,000,000) aggregate.

2. Automobile Liability Insurance against claims of Personal Injury (including bodily injury and death) and Property Damage covering all owned, leased, hired and non -owned vehicles used by the Developer with minimum limits for Bodily Injury and Property Damage of ONE MILLION DOLLARS ($1,000,000) each occurrence and TWO MILLION DOLLARS ($2,000,000) aggregate. Such insurance shall be provided by a business or commercial vehicle policy.

3. If the Developer hires a consultant to provide design services, such as architectural or engineering services in connection with the Project, or any portion of the Project, the Developer shall require each such consultant to provide Professional Liability (Errors and Omissions) Insurance, for liability arising out of, or in connection with, the performance of such design services, with limits of not less than ONE MILLION DOLLARS ($1,000,000).

4. Upon acceptance of the Project or any portion thereof, from each contractor, the Developer shall maintain All Risk Property Insurance on the Project on a blanket basis or with an agreed amount clause in amounts not less than 100% of the replacement value of all portions of the Project so accepted. Such coverage shall name the City as a loss payee as their interests may appear.

B. During the construction of the Project, the Developer shall require that each contractor performing work on the Project maintain the following insurance coverage at all times during the performance of said work:

1. The Developer shall maintain Builder ’s Risk (Course of Construction) Insurance to be written on an All Risk Completed Value form, in an aggregat e 55575.18175\40908266.11

22 amount equal to 100% of the completed insurable value of the Project or portion of the Project on which such contractor is performing work. Such coverage shall name the City as a loss payee as their interests may appear.

2. Each general contractor and each sub-contractor shall maintain Commercial General Liability Insurance with limits of not less than ONE MILLION DOLLARS ($1,000,000) per occurrence and TWO MILLION DOLLARS ($2,000,000) aggregate to protect the Developer during the construction of the Project from claims involving bodily injury and/or death and damage to the property of others.

3. Each general contractor and each sub -contractor shall maintain Automobile Liability Insurance against claims of personal injury (including bodily injury and death) and property damage covering all owned, leased, hired and non -owned vehicles used in the performance of the contractor ’s obligations with minimum limits for bodily injury and property damage of ONE MILLION DOLLARS ($1,000,000) each occurrence and TWO MILLION DOLLARS ($2,000,000) aggregate. Such automobile liability insurance shall be provided by a business or commercial vehicle policy.

C. The required insurance described above shall include endorsements naming the Additional Insureds as additional insured for l iability arising out of this Agreement and any operation related to this Agreement.

D. Any insurance coverage required under this Agreement shall not be written on a “claims made” basis. The applicable certificate of insurance must clearly provide that the coverage is on an “occurrence” basis. The requirements of this Section shall survive any expiration or termination of this Agreement and any Certificate of Completion.

E. Receipt by the City of evidence of insurance that does not comply with the above requirements shall not constitute a waiver of the insurance requirements of t his Agreement.

F. All of the insurance coverage required under this Section shall be maintained by the Developer or its contractors or sub-contractors of any tier , as required by the terms of this Agreement, until the issuance of the Certificate of Completion and shall not be reduced, modified, or canceled without at least thirty (30) days prior written notice to the City.

Also, phrases such as “endeavor to” and “but failure to mail such notice shall impose no obligation or liability of any kind upon the company” shall not be included in the cancellation wording of any certificates of insurance or any coverage for the Additional Insureds. The Developer shall immediately obtain replacement coverage for any insurance policy that is terminated, canceled, non-renewed, or whose policy limits are exhausted or upon insolvency of the insurer that issued the policy.

G. All insurance to be obtained and maintained by the Developer under this section shall be issued by a company or companies listed in the then current “Best’s Key Rating Guide ” publication with a minimum of an “A:VII” rating and be admitted to conduct business in the State of California by the State of California Department of Insurance. 55575.18175\40908266.11

23 H. The City will not accept self -insurance in satisfaction of the insurance requirements of this Section.

I. All insurance obtained and maintained by the Developer in satisfaction of the requirements of this Agreement shall be primary to and not contributing to any insurance maintained by the Additional Insureds.

J. Insurance coverage in the minimum amounts set forth in this Section shall not be construed to relieve the Developer of any liability, whether within, outside, or in excess of such coverage, and regardless of solvency or insolvency of the insurer that issues the coverage; nor shall it preclude the Additional Insureds from taking such other actions as are available to them under any other provision of this Agreement or otherwise at law.

K. Failure by the Developer to maintain all insurance coverage required by this Section in effect shall constitute a default of this Agreement by the Developer. The City, at its sole option, may exercise any remedy available to it in connection with such default.

Alternatively, the City may, at its sole option, purchase any such required insurance coverage and the City shall be entitled to immediate payment from the Developer for any premiums and associated costs paid by the City for such insurance coverage. Any election by the City to purchase or not to purchase insurance otherwise required to be carried by the Developer shall not relieve the Developer of its obligation to obtain and maintain the insurance coverage required by this Agreement.

Section 3.8. Defaults - General.

3.8.1 Subject to Unavoidable Delays and any other extensions of time provided for in this Agreement and this Section 3.9, failure or delay by either Party to perform any term or provision of this Agreement shall constitute a default under this Agreement. The injured Party shall give written notice of default to the Party in default, specifying the default complained of by the non -defaulting Party. Delay in giving such notice shall not constitute a waiver of any default nor shall it change the time of default.

3.8.2 If a Party otherwise in default commences to cure, correct or remedy such default, within thirty (30) calendar days after receipt of written notice from the injured Party specifying such default, and diligently and continuously prosecute s such cure, correction or remedy to completion (and where any time limits for the completion of such cure, correction or remedy are specifically set forth in this Agreement, then within said time limits), such Party shall not be deemed to be in default under this Agreement.

3.8.3 Any failure or delays by either Party in asserting any of their rights and/or remedies as to any default shall not operate as a waiver of any default or of any such rights or remedies. Delays by either Party in asserting any of their rights and/or remedies shall not deprive either Party of its right to institute and maintain any actions or p roceedings that it may deem necessary to protect, assert or enforce any such rights or remedies.

Section 3.9. Events of Default. In addition to other acts or omissions of the Developer that may legally or equitably constitute a default or breach of this Agreement, the occurrence of any of the following specific events shall constitute an “Event of Default” under this Agreement, 55575.18175\40908266.11

24 and, if they occur prior to the issuance of a Certificate of Completion for the Project, they shall not be subject to the provisions of Section 3.10:

3.9.1 Any default by the Developer under any construction loan documents for any purpose or reason which is declared in writing by the lender and which materially impacts the Project. So long as the construction continues on the Project, no default or Event of Default will be declared.

3.9.2 Any breach by the Developer of any of the non-monetary covenants and conditions of this Agreement that is not cured within thirty (30) days following written notice of the breach to the Developer from the City or the expiration of an applicable shorter cure period set forth in this Agreement.

3.9.3 Any representation, warranty or disclosure ma de to the City by the Developer regarding this Agreement or the Project is materially false or misleading when made.

3.9.4 The Developer fails to make any payment or deposit of funds required under this Agreement or to pay any other charge set forth in this Agre ement, following ten (10) days’ written notice to the Developer from the City of such failure.

3.9.5 Any material deviation in the work of improvement of the Project from the approved Scope of Development, without the prior written approval of the City, or the appearance of defective workmanship or materials and such defects are not corrected or substantially corrected, within thirty (30) days after receipt of written notice thereof from the City to the Developer.

3.9.6 Subject to the extensions of time or excuses for performance in this Agreement, the construction of the Project is delayed or suspended for a period in excess of that permitted under this Agreement , subject to the occurrence of Unavoidable Delays ; or the development of the Project does not proceed with d ue diligence, pursuant to the Schedule of Performance, subject to the occurrence of an Unavoidable Delay; or the Project is not completed by the Project Completion Date, subject to the occurrence of Unavoidable Delays.

3.9.7 There occurs any event of dissolution, reorganization or termination of the Developer that adversely and materially affects the operation or value of the Property, and such event is not corrected within twenty days following written notice of such event from the City to the Developer.

3.9.8 The Developer sells, Transfers, hypothecates, encumbers or assigns its interest in this Agreement, the Property, or Project, or any portion thereof, whether voluntarily or involuntarily or by operation of law, in violation of the terms and conditions of this Agreement.

3.9.9 The Developer becomes insolvent or a receiver is appointed to conduct the affairs of the Developer under state or federal law;

3.9.10 The Developer’s legal status as a California limited liability company authorized by the Secretary of State of the State of California to transact business in California is suspended or terminated.
55575.18175\40908266.11

25 Section 3.10. Repurchase Option.

3.10.1 Option to Repurchase Upon Failure to Commence or Complete Construction of the Hotel. In the event the construction of the Project is delayed or suspended for a period in excess of that permitted under this Agreement, subject to the occurrence of Unavoidable Delays; or the development of the Project does not proceed with due diligence, pursuant to the Schedule of Performance, subject to the occurrence of an Unavoidable Delay; or the Project is not completed by the Project Completion Date, subject to the occurrence of Unavoidable Delays. City shall have the option to repurchase the Property from Developer at City’s election by written notice to Developer given within six (6) months after the occurrence of any such event, time being of the essence (“Repurchase Election Notice”). In the event City fails to give the Repurchase Election Notice within such six (6) month period, the City shall not have the Repurchase Option under this Section 3.10 in respect of the event giving rise thereto.

In the event City exercises its Repurchase Option, the purchase price (“Repurchase Price”) payable by City to Developer with respect to the Property shall be an amount equal to the original purchase price paid by Developer to City for the Property; plus any cash (including but not limited to check, wire, ACH or any other form of payment) payments previously paid by the Developer for the development of the Property for the improvements thereon, financed costs associated with design and entitlements, amount financed inclusive of all “hard” and “soft” costs related to the site and the improvements to be constructed thereon, including without limitation, arch itectural, engineering, and legal fees paid to government entities, and cost of all on-site labor and materials for the construction of the improvements existing on the Property at the time of repurchase (but not including any payment under the Services Agreement between the City and Developer for the construction of any parking facilities), or the fair market value of the Property, including any improvements thereon, as determined through an appraisal of the Property as of the date of the Repurchase Notice performed by an appraiser hired by the City and the Developer, whichever is lower.

Closing for repurchase of the Property pursuant to Repurchase Option shall occur on the date specified in Repurchase Election Notice, which shall be no earlier than sixty (60) days and no later than one hundred and eighty (180) days after the date of the City ’s service on Developer of Repurchase Election Notice. Developer and City shall each pay one-half (1/2) of the escrow fees, and Developer shall pay for (i) any documentary tax stamps and (ii) an ALTA standard Owner’s Policy of Title Insurance in the full amount of the Repurchase Price showing fee title vested in the City. The City shall pay the recording fee for any other instruments which are recorded through such escrow.

ARTICLE IV

MISCELLANEOUS
Section 4.1. No Third-Party Beneficiaries; No Assignment . Developer represents and warrants, except as expressly set forth herein, there are no express or implied third -party beneficiaries to this Agreement, and no person or entity not a signatory hereto shall have any rights or causes of action against the City arising from or in connection with this Agreement or the Development Agreement. Developer represents and warrants it has not sold, assigned, or otherwise transferred, or purported to, a nd shall not hereafter, sell, assign, or otherwise transfer any of the 55575.18175\40908266.11

26 obligations, liabilities, demands, claims, costs, expenses, debts, controversies, damages, rights, actions, or causes of action released pursuant to the Original Development Agreement o r this Agreement. This Agreement shall not be assignable without the prior written consent of City, which may be withheld by City in its sole discretion, and any assignment or other transfer in contravention of this Section shall be voidable at the election of the City or the City may elect, in its sole discretion, to terminate this Agreement or pursue any remedy available to City herein, at law, or in equity.

Section 4.2. Enforcement of Agreement. Except as otherwise expressly set forth in this Agreement, no action shall be brought or maintained until: (a) the non -breaching Party provides written notice to the breaching Party which explains with particularity the nature of the claimed breach and (b) within thirty (30) days after receipt of said notice, the breaching Party fails to cure the claimed breach or, in the case of a claimed breach which cannot be reasonably remedied within a thirty (30) day period, the breaching Party fails to commence to cure the claimed breach within such thirty (30) day period and thereafte r diligently complete the activities reasonably necessary to remedy the claimed breach.

Section 4.3. Damages. In the event any action or proceeding is brought to enforce this Agreement, the prevailing Party shall be entitled to the reasonable fees, out -of-pocket expenses, and costs of attorneys and experts against the non-prevailing Party, in addition to all other relief to which that Party may be entitled.

Section 4.4. Limits. This Agreement shall not be construed as creating any right or benefit, substantive or procedural, enforceable at law or in equity, by any Party against any person, agency or entity other than those set forth herein.

Section 4.5. No Waiver. The failure to insist on any one occasion upon strict compliance with any of the covenants or conditions hereof s hall not be deemed a waiver of such term, covenant, or condition, nor shall any waiver or relinquishment of any rights or powers hereunder at any one time or more times be deemed a waiver or relinquishment of any rights or powers hereunder at any other time or times.

Section 4.6. Notices. Any notice, request, or communication required to be given to either Party under this Agreement shall be given in writing and shall be personally delivered or mailed, by prepaid registered or certified mail, to the addresses below:

Party to be Noticed: Selene Palm Springs, LLC
Attn.: Rabinder Pal Singh
200 West 55th Street
New York, NY 10019_________________________
City of Palm Springs
Attn.: Flynn Fagg
3200 E. Tahquitz Canyon Way
Palm Springs, CA 92262
55575.18175\40908266.11

27 With Copy to: Boren, Osher & Luftman, LLP
Attn.: Stephen Z. Boren
222 N. Pacific Coast Hwy, Ste. 2222
El Segundo, CA 90245

Best Best & Krieger
Attn.: Elizabeth Hull
18101 Von Karman Avenue
Irvine, CA 92612 _________________________
Section 4.7. Entire Agreement. This Agreement, including the true and correct Recitals above, which are incorporated by reference herein as operative covenants and specifically relied upon by the Parties in executing this Agreement, constitutes the entire agre ement and understanding among and between the Parties and supersedes any and all other prior and contemporaneous agreements whether oral or written between the Parties.

Section 4.8. Amendments and Modifications. This Agreement may only be modified or amended by writ ten instrument duly approved and executed by each of the Parties hereto, following all necessary approvals and authorizations for such execution.

Section 4.9. Rights of Lender to Modify Agreement. Developer’s lender or lenders may seek a mo dification of this Agreement in connect ion with a loan or refinance. In connection therewith, in any notice requesting a modification by Developer’s lender or lenders, the Developer shall include a statement to the City identifying any amendments, modifications, or other changes to this Agreement or its attachments which the lender or lenders is requesting in connection with the Developer obtaining or refinancing a loan. The City agrees to reasonably consider and not unreasonably withhold its consent to the requested amendme nt or modification , but shall not be obligated to accept, any amendment, modification, or other change to this Agreement or any of the attachments to this Agreement which materially restricts, diminishes or burdens the City’s rights and remedies.

Section 4.10. Choice of Law. This Agreement shall be deemed to have been executed and delivered within the State of California; the rights and obligations of the Parties hereunder shall be governed, construed, and enforced in accordance with the laws of the State of California.

The venue for any dispute arising from or related to this Agreement, its performance, and its interpretation shall be the Superior Court of California, County of Riverside, California . This Agreement is to be construed fairly and not in favor of or agains t any Party regardless of which Party or Parties drafted or participated in the drafting of its terms. The parties agree to mediate, in good faith, any claim arising hereunder and to refrain from filing a lawsuit relating to the terms and conditions of this Agreement until the parties have met with a mediator. The parties agree to select and mediate any claim or controversy within thirty (30) days of the date the claim or controversy accrues or first arises. The prevailing party pertaining to a dispute concerning this Agreement shall be entitled to reasonable attorneys’ fees and costs. However, any party who fails to comply with the mediation requirements of this section shall not be entitled to recover attorney’s fees.
55575.18175\40908266.11

28 Section 4.11. Authorized Signatory. Each Party represents and warrants that it has the full right and power to enter into this Agreement and to execute and bind the Party on whose behalf it/he/she is signing to the releases and other provisions contained herein, and further agrees to the extent it is in breach of its warranties to defend and indemnify each other Party in the event any claim is made which is contrary to the representations and warranties contained herein.

Section 4.12. Severability. If one or more provisions of this Agreement are hel d to be unenforceable under applicable law, such provision will be excluded from this Agreement and the balance of the Agreement will be interpreted as if such provision were so excluded and will be enforceable in accordance with its terms.

Section 4.13. Counterparts and Electronic Signatures. This Agreement may be executed in counterparts and, when so executed by the Parties, shall become binding upon them and each such counterpart will be an original document. Electronic signatures shall be as valid and have the same force and effect as original signatures.

[Signatures on following page]
55575.18175\40908266.11

S-1

IN WITNESS WHEREOF, each Party has executed this Agreement on the date which appears next to the corresponding signature.

I have read the foregoing Settlement and Development Agreement , understand it, and I accept and agree to the provisions it contains and hereby execute it voluntarily wit h full understanding of its consequences and to be bound by its terms.

Date

SELENE PALM SPRINGS, LLC
By: Calsprings Properties, LLC, Managing
Member

By: Rabinder Pal Singh, Manager

Date

CITY OF PALM SPRINGS

__________________, City Manager
Approved as to form:

Date:
__________________, City Attorneyr

[Signature Page to Settlement and Development Agreement] 55575.18175\40908266.11

A-1

ATTACHMENT A

LEGAL DESCRIPTION
55575.18175\40908266.11

A-2

ATTACHMENT B

SCHEDULE OF PERFORMANCE
[summarized below and attached]

PHASE 1: North Villas and all associated improvements. Developer shall obtain a building permit for Phase 1 by August 7, 2023 in accordance with Attachment B and shall substantially complete construction of Phase 1 by December 24, 2026.

PHASE 2: Hotel and Residential Towers and all associated improvements. Developer shall obtain a building permit for Phase 2 by September 9, 2024 in accordance with Attachment B and shall substantially complete construction of Phase 3 by December 25, 2026.

PHASE 3: South Villas and all associated improvements. Developer shall obtain a building permit for Phase 3 by October 30, 2023 in accordance with Attachment B and shall substantially complete construction of Phase 3 by December 25, 2026.

55575.18175\40908266.11

A-3

ATTACHMENT C

SCOPE OF DEVELOPMENT/ENTITLEMENT PACKAGE
[attached]

55575.18175\40908266.11

A-4

Scope of Development
The Revised Project (“Project”) includes the following and is described in greater detail in the Dream Hotel and Condominium Application as approved by the City Council on May 11, 2023:
• Between 150-160 Transit Occupancy Tax (“TOT”) generating hotel rooms. • No less than 28 residential units in the hotel tower which will be short term rental eligible. These units shall also be subject to the same TOT benefit as the hotel rooms set forth above.
• No less than 12 luxury residential units in the North Villas which will not be short term rental eligible.
• No less than 24 residential units in the South Villas which will not be short term rental eligible.

Once constructed, the site will operate as a 4 star or better hotel and shall include the following amenities at a minimum:
• Staffed front desk with multiple guest service capability and uniformed staff • Concierge services
• Valet service
• Bell services (luggage service)
• Full-service restaurant that serves breakfast/lunch/dinner with bar/lounge (separate or adjoining restaurant)
• Room service available for breakfast/lunch/dinner
• Gift shop or sundries available for purchase
• Swimming pool and separate whirlpool/hot tub
• Food and beverage service available poolside
• Desk or similar worktable in each guest room with enhanced desk chair • Multiple electrical outlets and USB ports near desk/worktable • Superior internet speed and capacity available throughout the property (multiple routers with consistent signal strength).
• Safe in each guest room.
55575.18175\40908266.11

A-5

• Laundry/dry cleaning service available to guests

r::i L.J I 22002.00_0ream Hot~I · City Couocl Sc:he,dule (3 Fhanclns l
0 s""' CMI c ... mumon
aw-si,,rm SuGndi"'i
0028.zl l.2.2s..26 \95w4d
ou, .23 09.06.24 ,:,,..,
0U7.23 09.06,.24
0U7.2'l 04.17.23
l . l..2 City RNrN 04.17.2'3 05.26.23 6w

1.1.3 Sitr, ~-~ 05.29.23 GS.29.23

05.29.2'3 06.23.23
l . L5 Award ,:he .,,...:t ot..26.23 07.07.23 2w

1.1..6 GMP 07.10.2'3 08.04.23
LU 9 SiteCIYII 01.0ll.23 04..01..24 34w

1.1.7 .1 Wtte-~Pl an 09.08.2'3 10.02.23 8w

1.1..7.2 ~~t l'l:in 09.08.2'3 10.02.23 8w

1. L7.3 Submit ~ ~ t Pamit 10.30..2'3 l o.30..23

1.u ... OtvA<Mcw 10.30.2'3 11.10.23 2w

1.1..7.5 Silo:CiYIW;ilft-Ac>Ptolr.lll 11.13.23 11.13.23

1. L7.6 8idSitewcrii: 01.23.24 02.19.24
l .L7.7 Awa<dlhcpraject 02.20.24 03.04.24 2w
l . L7.8
LU

1.1.AI

1.U .2

1.1.&.3
u
H>
H2
H3
,u
H5
,,_,
H7
H8
22 u ,

2.2.LI

2.2.L 2

22.2 2 2.2,

22.22 02.23

22.2<
2 2.2,
,,.,,

02.27 22.'-8

22.29 2.2:.2.10

2.2..2.11
u
21,
U.2
u
n ,
,,, ,,.,
,u
B SiteCIYII ConsbUC1ion
Site ~ -Ro ... Gmi\g
Sil,,Camzructicn - SitelqMo.......mt
Paimem La,nda:,rpKlj: Canmuction
0 CoreWShdll'fflnil RN. # 3Adj;,smwnts
ftestart lhc pamit
MEP - ~ t Reemrt
MO'-Gon,&Shtll&i"f'l' Modoll
An:h -0-&Shdl add~ Rc,,. OCaim, cnts
SubmitGon! &Shcl l Rcv. -14
Cily R.,..,,,.:ndAppro,n k
Core & ShdlRe.r.*4 -~ic
An:h - eoo.dNCc CMIS~ Gr..dinc
13 Dnoa111Hout - Oeslp, and l'ennll:

B 0-...Ho !IOI
El Hot11n_.«
m c:ondora-
9 O.-.Ho mt &uadl111 ......

MW!l&Condo ·9uildilgl)q:,:inmm t ~ ­
MW!I & Condo - Buildl'lg Dei:,:inmmt Pl;,r, Re,L
MW!I & Condo· Buildsi1 Dq:,:inmm t Pl;ri RcvL
MW!! & Condo· Buil<Xlg l)q:,:inmm t Updm.# 1
MW!I & Condo · Buil<Xlg l)q:,:inmm t <Ul>miml _
Hoo:! & Condo · BuilCfflg l)q:, :inmm t Plan RcvL
MW!I & Condo -Buildsis l)q:,-..:., t PI-. RcvL
MW!I & Condo • Buil<Xlg Dq:,:inmm t Upd~r., #2
MW!I & Condo · Buildl'lg Dq:,:inmm t subnliml _
Hocel & Condo · Buildilg Dep:inmm t Plat1 Re,L
MW!l& Condo- Buil<Xl1 ~ t PS-, RcvL
0 Dn!amHoutc:..n.walon-SuperS~
--SuperS 11'uctun:
8 Fhandnslll
0 Dn,:im Motl!IO>ns truaion
Extcri:,,r ~ ard rooflrllj:

Builcf.,. Extaiar
-
. .,,,,.

01.07.23 09.06,.24 S7w

08.07.2'3 10.06.23 9w

10.09.2'3 ot..14.24 36w
ot..'7 .24 09.06.24 12w

03.28.23 02.21..lS 99w 4d

03.28.23 01.23.2 4 43w

03.21.2'3 05..01...23

05.02.23 06.26.23
ot..27.23 l o.30..23 18w

09.04.2'3 10.27.23 8w

10.1 1.2'3 l o..31.23

10.11.23 01.22.24 12w

01.23.24 0 1.23.24

05.02.2'3 08.07.23

04.17.23 04l.13.24 69w Id

04.17.23 04..29..24

04.17.23 04.29.2 4 kw
0S.0 1.2'3 04.29.24 52w

03.18.24 (Ml.13.24 2lw ld

03.18.24 03.18.24

04.03.24 04.03.24

05.29.24 05.29.24
ot..07.24

09.02.24 08.02.24
0IU3.24

09.09.24 09.09.24

10.07.24 01.07.2'3 12.25.26 l " w

02.2•-~ 12.25.26

02.24.25 OS.16.25 12w

05.19.~ OS.19.25

05.19.~ 06.27.25
ot..30..25 12.25.26

3.2 13 tbffl\VII~ 01.07.23 12.24.26 l76w4d
1 2.l B Naoth\lllla• 01.07.23 09.16.24 58w

3.2.LI 0 Schematic Dmp, 01.07.23 lo.30..23 12w

3.2.U (!I ~ ONeiopnwn t 10.30.23 03.15.24 20w

12.U 0 COf'IA'\Ktion Documents 03.18.24 09.16.24 26w

3.2.L-4 0 BldcHns& ~non 07.22.24 Oll..30..24 6w

3.2..2 e NaothVIUaoB..a::lins Pormlts 07.22.24 1:t.13..24 20w4d l-lll NonhVi n:111-8,.ldi '1J~'"' bmiff•hl 07.2:2.24 07.22.24 l-2.2.2 NorthViR:111·8uildi'"4~ Pl:wi~,1 07.22.24 04.06.24 2w 2d l-2.2.3 NorthViR:111•8uiidir11j:~ Pl;an~---- 08.07.24 08.07.24 l-2.2.-4 NonhVi n:111-Buildi'"4~ Upd.att, 1 09.07.24 14l0t.24 l-2.2.S NonhVi n:111-8uildi'1J~'"'bmitt.>l rf2 10.02.24 10.02.24 l-2.2.6 North ViQ:111-Buildirc~ Pl;an~,2 10.02.24 10.10.24 lw2d l-2.2.7 NonhVi R:111 -BuiklircOi,patmau: Pl;an~ ---- 10.1 1.24 10.t t.24 l-2.2.8 Nonh ViR:111-Buildirc~Upd.attll'.2 10.11.24 120S..24 8w l-2.2.9 Nonh Vin:111-Buildirc~,..bmi tt.>lsJ 12.ot..24 12.06.2• 1 2.2.10 NonhVi n:111-euildirc~ Pl;an~,3 12.ot..2"1- 12.12..2• l-lll l Nonh ViR:111 -8uiklir11j:~ Pl;an~ ---- 12.13.24 12.13.24 J.2.3 a NanhY'lll a,conmumon 11.0 1.24 12.2u,s 112w

3.2.3.l Mobili:fflon 11.01.24 12.12.24 6w
l-2.1.2 f"ounda, tix, 12.13.24 02.06.25 8w
l-2.3.3 Sui,u Saucture 02.07.~ ot..12..25 18w
0U3.2S 12.24..26
1 3 13 SovthY'lllao 10.30.23 12.25.26 165w
1 3.l B Southl/lla 10.30.23 12.09.24 58w

13.LI 0 Sct..natlc Dmp, 10.30.23 01..22..24 12w
1 3.1.2
1 3.U
uu
,,., ,,.,_, ,,.,_, ,,., ,,.,_. ,,.,_, ,,.,_, ,,.,
''-'-' ,,.,_,

3.3.2.10 3.3..2.11
,,., ,,.,._,

3.:l.3.2
,,.,_, ,,.,_.
(D De,iip, Dewlc,pm,en t
El COfl-»etion Documents 06.10.24 12.09.24 26w
m Blddlns& ~ non 10.i..z.. 11.22.24 ""'
B South v._ euw.i.., Pwmla 10.14.24 01.03.25 20w
Souffi\Jibs-Bvild ingo,partrnfflt -.,bmit;:,IU 10.14.24 10.14.24 Sou1h\Jibs-Bvid ingo,p ;inmen1P1.ir,ReYH!W_ 10.14.24 10.25.24 2w 5ou1h\Jibs- BuildingD.i, ...-tmor,t P(..-,fl:eview-_ 10.28.24 10.28.24 Sou1h Vibs:- Buildingo,partment Upd:rr,,t 1 10.21.24 12.20..24 Sou1h'lo'ibs:- lhlilding0o,p artmffl t SJbmitt:11'2 12.23.24 12.23.24 Sou1hVibs · Building Oep~ Pl¥1R!MeW_ 12.23.24 12.27.24
Sou1h\Jibs · Buildina:Do:i,...-tmor,t f't..-,RCWW -.. 12.30.24 11.30.24 Sou1r1Vibs-Build ingo,,partmon t Update# 2 12.30.24 02..21..25 Sou1h\Jibs-Buid ingo,,partrnffl 1-,brnit;all":l 02.24.2S 02.24.25 Sou1h\Jibs - lluid ing °'Partrnffl t pt.., Re-.iew_ 02.24.25 02.28..25 5ou1h Vibs - lluildingD,i,artmentPlaiReYH!W -_ 03.03.~ G3..03..25 e South,., .... Construction 01.20.~ 12.25.26 101 ...

Mobili:fflon 01.20.25 02.28..25
l"oundatixi 03.03.~ 04..25..25 8w
Sui,u Saucture 04.21.~ 04U9.25 18w
.. ,
FirlMGing l 04.17.23- 09.06.ZA
---
~5dSilcWMI
.ilb "-dlhl!prq,KI
SilO· Civil CoAstrudiDn I Qt.07.23 • 09.06.2-t
•~ GMP
~""""""""""·--
~ • 0328.2:3- 02.1:US
Catt andShl!I PMfflil R-. • 3A~ I ..25.23-01.23.1:A
~ ~"""'~
>EP - P,, ,a=-
l "'"·~·----
I
-- Arch-C:O.e&std~ ,gR=,OCornrra,t:;
I
Scbni!Cc:tt&ShellRN . ..

OtyR~Md~
~ .. Coie&Sho1Re•d14 - i:>
A,ct, . eo.........,awSiteG.ading
DrNmHolel - ~Md~ 104.1723- 08.13.24
Drunotiotd 10U7.1:J - 04.29.21
HaibdT.-.. 10•U7.2:3 - 0U9.2A
Condo T_.- I 05.01.23 - Ol.29..24
&ha-.:~ 1 06.0 7.23- 10.3023
l}esiiJ,,~ 110.30.23- 03.15.24
-
.. , ... ...
~Canaucbar, - Sitel.....,..-emon
~.Nlan:I~~
.
-
~ ~ 110.30.Z3 - 01.22.21
OesignOewl...,...... 101...22.24 - 06.07.2-t
----------- ConmucliOftDoc:umH.ts l 06.J.0.24 - 12..(lg.21 ~ I 10.1424 - 11.2.2.24
Soillt!VimBuildlingPcnnc 110.14.24 - 03.0l.25
£ Sovlhv.lw -a.tingDep,,,ln"lel'C~ll! 1
111:i Sa<.doV.....-&itingDepa,1,nor,tPlm,~ #1
L.1t:J s....t,V....: . Buiklng0epanme,tP15n~ - C-anmene:i11 Sc.ahVila:: . &iting~Updlft#l
~ 1SoutlVl81:i-BuHng~~ i£l.

I- Scudi\'k - BuHngOqwmmllPl..,Review ifZ
~ So.ahVila!: - &lildwlg~Flan~-ean-..-t11
So<.l!hV.S-fkoil:ling~Ufd-111
~ SoAVln:. - &ildin!J~oubrn~ ,13
~ SoulhVk: - &tingDq,a,tmm:AllnRnoew;!IJ
~ So.A,Vila::.&.dng~PLsn R~-- ~al
Soult, V..- ~ I 01.20.25 -12..25.26
.. , - ... ...

S.,,..Soucu •