HomeMy WebLinkAboutSS5 - Proposed Ocean Water Desalination ProjectCITY OF NEWPORT BEACH
CITY COUNCIL STAFF REPORT
Study Session Agenda Item No. ss5
January 12, 2010
TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL
FROM: Utilities Department
Craig A. Justice, Deputy Utilities Director
949 - 644 -3402 or cjustice @newportbeachca.gov
SUBJECT: Proposed Ocean Water Desalination Project in Huntington Beach
ISSUE
Should the City submit documents necessary to allow City participation in the
Poseidon desalination project working group with the Municipal Water District of
Orange County ( MWDOC), other Orange County water retailers and Poseidon
Resources LLC?
RECOMMENDATION
Discuss and provide direction to staff to sign a Letter of Intent, Memorandum of
Understanding and Confidentiality Agreement for full participation in the Poseidon
Desalination project working group.
DISCUSSION:
Background:
The proposed Poseidon Resources LLC ocean water desalination project located in
Huntington Beach has been moving forward over the last several years. Poseidon has
received various approvals to proceed with the project. Several major environmental
and financial hurdles still remain. The cost of the project is estimated at approximately
$520 million. Poseidon is projecting an optimistic schedule to commence construction in
the next 12 to 18 months. The facility will be designed to produce 56,000 acre /ft/yr or 50
million gallons /day of product water for purchase. The price of product water for
purchase is being determined. However, it is assumed the price needs to be consistent
with the Metropolitan Water District of Southern California imported water pricing to be
competitive with other water resources available to Orange County water retailers.
In order to efficiently evaluate the opportunity and present a united front to obtain the
best possible water purchase terms, the MWDOC and Orange County water retailers
formed a working group to facilitate open discussion on the project. The group has been
Proposed Ocean Water Desalination Project in Huntington Beach
January 12, 2010
Page 2
meeting on a regular basis to discuss the project development status, possible water
supply conveyance and integration options, new distribution infrastructure needed and
the framework of terms and conditions of possible negotiated water purchase
agreements. It is anticipated purchase water negotiations will commence in the early
summer 2010 for interested agencies.
The MWDOC and ten (10) Orange County water retailers signed a Memorandum of
Understanding (MOU) with Poseidon outlining how they will interact with each other and
how discussions can proceed in a fair, open manner. These agencies have also signed
a Letter of Intent to Poseidon indicating their interest in the potential purchase of
desalinated water. Both the MOU and Letter of Interest are non - binding and have gone
through legal review by their respective agencies. The agencies who have signed the
MOU and Letter of Intent are listed below:
• Municipal Water Districts of Orange County
• City of Anaheim
•
El Toro Water District
• Moulton Niguel Water District
• Trabuco Canyon Water District
• City of Santa Ana
• Irvine Ranch Water District
• Laguna Beach County Water District
• Mesa Consolidated Water District
• Santa Margarita Water District
• South Coast Water District
Understanding the financial details and viability of Poseidon's private venture is
important to determine if purchasing water is appropriate by Orange County water
retailers. To allow for discussion of the financial aspects and water purchase terms, the
working group has written a Confidentiality Agreement. Certain aspects of the project
will be deemed confidential for the purposes of protecting that information from a third
party. MWDOC and the other agencies are now considering signing this agreement. It is
voluntary; however, most agencies have stated they will sign the agreement. If an
agency does not sign on, they cannot sit at the table and will need to rely on the other
agencies to work on their behalf.
City and Other Agency Participation
The Poseidon working group has amended the MOU to allow additional water retail
agencies to sign on and participate. Other agencies considering participation include
the City of Garden Grove, City of Seal Beach, Orange County Water District, Yorba
Linda Water District, City of Westminster and Golden State Water Company.
For full participation the City would need to sign a Letter of Intent, the amended MOU
and the confidentiality agreement. These documents have been reviewed by the City
Attorney's Office. The amended documents for Council consideration are attached to
this report. As a look ahead, staff would likely return in late spring 2010 with a project
update leading into possible Council consideration of a purchase water agreement.
A presentation and project update was provided to the Coastal / Bay Water Quality
Advisory Committee by the MWDOC and Poseidon at the September 10, 2009
meeting. The committee generally supports this alternative source of water supply and
Proposed Ocean Water Desalination Project in Huntington Beach
January 12, 2010
Page 3
recommended that staff present the project to Council. The major project
environmental concern is possible harm to ocean life by using the ocean water intake
outfall pipelines need to supply water to the desalination facility. These concerns
should be addressed in the project EIR document and subsequent regulatory approval
mitigation requirements.
Benefits of Participation
The City has three primary sources of water supply: imported water, groundwater and
recycled water. The ocean water desalination project, should it be built, would provide
the City an opportunity to diversify its water supply portfolio to include a local source
that should be very high quality, consistent in its supply and not subject to the
variability of our other water supplies. For example, a more diversified water resource
portfolio would better protect the City against the dynamic imported water supply
situation, severe droughts and water restrictions, local groundwater water table issues
that reduce our pumping percentage and natural disasters should one of our other
water supplies be cut off. It is estimated the City could utilize in the range of
approximately 3,000 to 8,000 acre /ft/yr of desalination water to replace and /or buffer
City exiting water supplies.
The main challenge will be to negotiate and keep costs as economical as possible and
competitive with our other water supply sources in the long run. Other side benefits
that City may afford include the possibility of a direct connection from the facility to the
City's groundwater well field line due to their close proximity. A direct connection into
the City system could support possible water supply partnerships with adjoining
coastal cities.
Environmental Review:
Staff recommends the City Council finds that participation in the Poseidon desalination
project working group is not subject to the California Environmental Quality Act
( "CEQA ") pursuant to Sections 15060(c)(2) (the activity will not result in a direct or
reasonably foreseeable indirect physical change in the environment) and 15060(c)(3)
(the activity is not a project as defined in Section 15378) of the CEQA Guidelines,
California Code of Regulations, Title 14, Chapter 3, because it has no potential for
resulting in physical change to the environment, directly or indirectly.
Prepared and Submitted by:
Craig . Justice' Utilities Director
Attachments: Attachment A — Letter of Intent
Attachment B — Memorandum of Understanding
Attachment C — Confidentiality Agreement
Attachment A
November 3, 2009
Mr. Andrew Kingman
Chief Financial Officer
Poseidon Resources
501 W. Broadway Suite 2020
San Diego, CA 92101
Re: Letter of Intent Regarding Potential Water Purchase Agreement
Dear Mr. Kingman:
The purpose of this letter (the "Letter of Intent ") is to indicate the interest of the
City of Newport Beach in the potential purchase of up to 8,000 acre -ft per year of
desalinated water from a seawater desalination plant to be built by Poseidon Resources
( "Poseidon') at its site in the City of Huntington Beach, and to set forth certain conditions
for such purchase between the City of Newport Beach and Poseidon. .
1. Water Purchase Agreement. The City of Newport Beach along with, several
other Orange County retail water agencies (the "Participating Retail Agencies "), and
Poseidon have entered in a Memorandum of Understanding to review the Participating
Retail Agencies interest in purchasing desalinated water from the Huntington Beach
Project ( "Project "). The City of Newport Beach has, and continues to be, interested in
pursuing good faith negotiations to reach agreement on the terms to be set forth in a
definitive water purchase agreement, based on and subject to the following key minimum
conditions and other terms to be agreed upon by and between the City of Newport Beach
and Poseidon.
2. No Liability. Except for the obligation to negotiate in good faith and for
Section 3 below, the provisions of this Letter of intent are non - binding and do not
constitute and will not give rise to any legally binding obligation on the part of the Parties
hereto. Nothing contained in this Letter of Intent (including the Term Sheet) shall be
deemed or construed to be an agreement or obligation of either party to conclude
negotiations by the execution of the Water Purchase Agreement. The provisions of this
Letter of Intent (including the Term Sheet) do not create any rights on the part of either
Party.
3. Costs. Except as otherwise agreed to, each of the Parties shall be responsible
for its own costs and expenses relating to the review, negotiation and documentation and
of a Water Purchase Agreement except as otherwise agreed in the Memorandum of
Understanding.
4. Permittine. Poseidon and City of Newport Beach recognizes the potential for
regional supply reliability benefits that ocean desalination projects offer to the City of
Newport Beach and other Orange County and Southern California agencies. To this
extent, and with the understanding that this letter doe not in any way commit the City of
Newport Beach to purchase water from the project, the City of Newport Beach will
cooperate as it deems appropriate with Poseidon in its efforts to obtain all necessary
regulatory approvals and permits to enable the timely construction of the project.
5. Governing Law. This Letter of Intent shall be governed by and construed in
accordance with the laws of the State of California without reference to its conflicts of
laws principles.
6. CountMarts. This Letter of Intent may be executed in one or more
counterparts, each of which, when executed and delivered, shall be an original, but all of
which together shall constitute but one and the same instrument.
If this Letter of Intent properly reflects our understanding, please indicate by
signing in the space provided below and returning a copy to the undersigned.
APPROVED AS TO FORM: CITY OF NEWPORT BEACH,
OFFICE OF THE CITY ATTORNEY A Municipal Corporation
Leonie H. Mulvihill,
Assistant City Attorney
ATTEST:
By:
David Kiff,
City Manager
Agreed and Accepted:
Poseidon Resources, LLC
By: By:
Leilani I. Brown,
City Clerk
Andrew Kingman,
Chief Financial Officer
Attachment B
First Amendment to
Memorandum of Understanding
THIS FIRST AMENDMENT ( "First Amendment ") TO THE MEMORANDUM OF
UNDERSTANDING dated May 22, 2008 ( "MOU ") is made by and between all the original
signatories to the MOU, to wit, Poseidon Resources (Surfside) LLC and its affiliates (collectively,
"Poseidon "), the City of Anaheim Public Utilities Department, El Toro Water District, Irvine Ranch
Water District, Laguna Beach County Water District, Mesa Consolidated Water District, Moulton
Niguel Water District, City of Santa Ana Public Works Agency, Santa Margarita Water District,
South Coast Water District, Trabuco Canyon Water District (collectively "MOU Retail Agencies "),
and the Municipal Water District of Orange County ( "MWDOC ").
WHEREAS, Poseidon, the MOU Retail Agencies and MWDOC previously executed the
MOU to define how they will interact with each other and with outside parties in connection with
discussion and negotiation of a long -term water purchase agreement or multiple long -term water
purchase agreements through which some or all of them may purchase water from Poseidon's
Huntington Beach Desalination Project ( "Project "); and
WHEREAS, numerous other public and private water retailers have developed an interest in
joining these discussions and negotiations with Poseidon on an equal basis with the MOU Retail
Agencies; and
WHEREAS, the MOU (1) does not obligate any party to the MOU to enter into a water purchase
agreement with any other party to the MOU, and (2) does not provide Poseidon, the MOU Retail Agencies
or MWDOC with exclusive negotiating rights or obligations; and
WHEREAS, currently the interests of all parties to the MOU appear to be served by expanding the
number of MOU Retail Agencies under the MOU, which will expand the potential market for Project
water, increase efficiency in the dissemination and analysis of Project information by and among Orange
County water retailers, and spread certain fixed costs of the negotiation process among a greater number
of potential participants; and
WHEREAS, in the interest of avoiding the cost, delay and inefficiency of repeated written
amendments signed by all parties, as currently required by Section XI(b) of the MOU, the undersigned
wish to amend the MOU to allow additional potential water purchasers to join the MOU by a simple
amendment approved and executed only by Poseidon and the potential water purchaser, with notice to all
other parties and subject to objection by any party within 30 days;
NOW, THEREFORE, in consideration of the foregoing recitals and the terms, covenants and
conditions contained herein, Poseidon, the MOU Retail Agencies, and MWDOC agree as follows:
FIRST AMENDMENT TO POSEIDON MOU Page 1
The introductory paragraph of the MOU is hereby amended as follows, with all new text
underscored:
Poseidon Resources (Surfside), LLC and its affiliates (collectively
"Poseidon "), the Participating Retail Agencies, and MWDOC (each
hereinafter referred to as a "Party" and collectively the "Parties ")
desire to enter into this Memorandum of Understanding (the "MOU ")
to define how the Parties will interact with each other and with
outside parties in connection with discussion and negotiation of a
long -term water purchase agreement or multiple long -term water
purchase agreements ( "WPA" and "WPAs" respectively) through
which some or all of the Participating Retail Agencies may purchase
water from Poseidon's Huntington Beach Desalination Project
( "Project "). Other potential purchasers of Project water may join the
list of Participating Retail Agencies at any time with full rights and
obligations under the MOU, without written approval of other
Participating Retail Agencies or MWDOC, by executing an
" Amendment to List of Participating Retail Agencies" in the form
attached hereto as Exhibit A and giving written notice to all Parties.
This right is subject to objection by any existing Participating Retail
Agency as provided herein,
2. Section I of the MOU is hereby amended as follows, with all new text
underscored:
I. Term
a) The term of this MOU (the "Term ") begins on the date the MOU is
executed by the Parties and terminates on June 30, 2011, unless
otherwise terminated pursuant to the terms herein or extended by
mutual written agreement of the Parties.
b) The Term for any new Participating Retail Agency joining this MOU
by execution of an Amendment (see Exhibit A) shall commence 30
days after the last date written notice of the Amendment is received
by any existing Participating Retail Agency. Within the 30 -day period
following receipt of such written notice of the Amendment, any
existing Participating Retail Agency may deliver a written Notice of
Objection to the Amendment to MWDOC, which shall forward it to
all Participating Retail Agencies and the agency submitting the
Amendment. The Notice of Objection shall state a reason for the
objection, and upon receipt by MWDOC it shall immediately render
the Amendment null and void. For purposes of this section, written
notice of the Amendment and of any Objection must be made through
an overnight delivery service.
FIRST AMENDMENT TO POSEIDON MOU Page 2
3. Section X of the MOU is hereby amended as follows, with all new text underscored:
Nothing in this MOU establishes or implies an exclusive arrangement
between Poseidon and the Parties, or any of them. This MOU does
not prohibit any Party from reviewing, participating in or developing
other potential water supply projects, nor does it prohibit Poseidon
from discussing and negotiating with other potential purchasers of
water from the Project in addition to Participating Retail Agencies
and MWDOC. Poseidon shall provide a copy of the MOU to other
such potential purchasers of water from the Project and notify them in
writing that they may become a signatory to the MOU, subject to the
right of each then existing Participating Retail Agency to object as
provided herein. Prior to entering into any binding arrangements or
WPA with such parties ( "Additional Water Arrangements "), Poseidon
will notify the Participating Retail Agencies and MWDOC of the
terms and conditions of such Additional Water Arrangement and the
identities of such potential purchasers of water from the Project.
Poseidon agrees to offer the Participating Retail Agencies no less
favorable terms and conditions than any Additional Water
Arrangement entered into at any time. It is mutually understood by
the Parties that this provision excludes up to 3,360 acre feet per year
of water sold to the City of Huntington Beach as agreed to in the City
of Huntington Beach entitlement process in 2006.
4. Section XI(b) of the MOU is hereby amended as follows, with all new text underscored:
b) This MOU shall be governed by the laws of the State of California,
United States of America, and may only be amended in a writing
signed by all Parties, except as expressly provided in this MOU, as
amended. Any legal action filed to enforce this MOU shall be
brought in state or federal court, as appropriate, in the State of
California.
5. Upon full execution of an "Amendment to List of Participating Retail
Agencies," notice to all Parties, and expiration of all rights to object to the
Amendment, Poseidon shall provide all new Participating Retail Agencies
with copies of any and all materials previously distributed to the Participating
Retail Agencies under Section IV of the MOU, "Uniform Disclosure of
Project Information."
6. Each party to this First Amendment represents and warrants that (a) it is an entity duly
organized, validly existing and in good standing under the laws of the jurisdiction in which
it is organized and is qualified to do business in all jurisdictions where it is required to be
qualified; (b) it has the necessary power and authority to enter into and perform its
obligations under this First Amendment and the MOU, as amended; (c) the person(s)
FIRST AMENDMENT TO POSEIDON MOU Page 3
signing this First Amendment is duly authorized to execute this First Amendment on
behalf of the party represented; (d) upon execution, this First Amendment and the MOU,
as amended, will be enforceable against each party in accordance with its terms, except as
such enforceability may be inconsistent with applicable laws concerning bankruptcy,
insolvency, reorganization, moratorium and other similar laws affecting creditors rights
generally; and (e) the execution and delivery of this First Amendment and performance by
the executing party under this First Amendment and the MOU, as amended, is not known
to conflict with any agreement, law, rule, regulation, order, judicial decree or
administrative code to which such party is subject.
ACKNOWLEDGED AND AGREED:
Poseidon Resources (Surfside) LLC
By:
Name:
Title:
City of Anaheim Public Utilities.
By:
Name:
Title:
Laguna Beach County Water
Authority
By:
Name:
Title:
Mesa Consolidated Water District
By:
Name:
El Toro Water District
By:
Name:
Title:
Irvine Ranch Water District
By:
Name:
Title:
Moulton Niguel Water District
L-fi
Name:
FIRST AMENDMENT TO POSEIDON MOU Page 4
Title:
Santa Margarita Water District
By:
Name:
Title:
Trabuco Canyon Water District
By:
Name:
Title:
Municipal Water District of Orange
County
By:
Name:
Title:
Title:
South Coast Water District
By:
Name:
Title:
City of Santa Ana Public Works Agency
By:
Name:
Title:
FIRST AMENDMENT TO POSEIDON MOU Page 5
EXHIBIT A
AMENDMENT TO LIST OF PARTICIPATING RETAIL AGENCIES
THIS AMENDMENT TO THE LIST OF "PARTICIPATING RETAIL AGENCIES"
DEFINED IN THE MEMORANDUM OF UNDERSTANDING DATED May 22, 2008 ( "MOU"),
AS AMENDED, is made by and between Poseidon Resources (Surfside) LLC and its affiliates
(collectively, "Poseidon ") and City of Newport Beach.
Pursuant to the First Amendment to the MOU, executed by all original Parties to the
MOU, City of Newport Beach is hereby added as a full "Participating Retail Agency"
under the MOU, as amended. No express approval or authorization by the governing
boards of the previously existing Participating Retail Agencies is required.
2. City of Newport Beach shall be responsible for sending written notice and a photocopy
of this Amendment to all previously existing Participating Retail Agencies within 10
days of the date of final execution of this Amendment. City of Newport Beach shall
request an updated list of Participating Retail Agencies from the Municipal Water
District of Orange County.
3. City of Newport Beach understands and agrees that within 30 days of receipt of such
written notice, any of the existing Participating Retail Agencies may assert an
objection to this Amendment pursuant to the terms of the MOU, and that upon timely
objection this Amendment shall be null and void.
4. Each party to this Amendment represents and warrants that (a) it is an entity duly
organized, validly existing and in good standing under the laws of the jurisdiction in
which it is organized and is qualified to do business in all jurisdictions where it is
required to be qualified; (b) it has the necessary power and authority to enter into and
perform its obligations under this Amendment and the MOU, as amended; (c) the
person(s) signing this Amendment is duly authorized to execute this Amendment on
behalf of the party represented; (d) upon execution, this Amendment and the MOU, as
amended, will be enforceable against each party in accordance with its terms, except as
such enforceability may be inconsistent with applicable laws concerning bankruptcy,
insolvency, reorganization, moratorium and other similar laws affecting creditors
rights generally; and (e) the execution and delivery of this Amendment and
performance by the executing party under the MOU, as amended, is not known to
conflict with any agreement, law, rule, regulation, order, judicial decree or
administrative code to which such party is subject.
FIRST AMENDMENT TO POSEIDON MOU Page 6
ACKNOWLEDGED AND AGREED:
Poseidon Resources (Surfside) LLC
By:
Name:
Title:
APPROVED AS TO FORM:
OFFICE OF THE CITY ATTORNEY
La
Leonie H. Mulvihill,
Assistant City Attorney
ATTEST:
Leilani I. Brown,
City Clerk
CITY OF NEWPORT BEACH,
A Municipal Corporation
By:
David Kiff,
City Manager
Agreed and Accepted:
Poseidon Resources, LLC
Andrew Kingman,
Chief Financial Officer
FIRST AMENDMENT TO POSEIDON MOU Page 7
Attachment C
CONFIDENTIALITY AGREEMENT
THIS CONFIDENTIALITY AGREEMENT ( "Agreement "), entered into and made effective as
of the day of , 2010, is by and between City of Newport Beach, a Municipal
Corporation [agency] ( "City ") and Poseidon Resources (Surfside) LLC ( "Poseidon ") (collectively
the "Parties ").
WITNESSETH:
WHEREAS, the Parties, along with other agencies providing water service (collectively,
City and such other agencies are referred to as the "Water Agencies "), have entered into
discussions and negotiations concerning the possibility of a public - private partnership regarding
Poseidon's Huntington Beach desalination project (the "Project "); and
WHEREAS, in order to proceed with the next stage of the discussions and negotiations,
CITY has requested, and Poseidon is willing to provide, certain information that Poseidon
considers proprietary and confidential; and
WHEREAS, Poseidon wishes to protect its proprietary and confidential information
against unauthorized use and disclosure by CITY;
NOW, THEREFORE, in consideration of the mutual promises and covenants made herein, and
with the intent to be legally bound hereby, the Parties agree as follows:
1. Confidential htformation. The term "Confidential Information," as used in this
Agreement, shall mean information, other than information described in one or
more of clauses (a) through (d) below in this Section, that is provided by
Poseidon to CITY. When Poseidon provides Confidential Information in
documentary form, whether hardcopy or electronic, it shall clearly mark it
"Confidential." When Poseidon provides Confidential Information to CITY
verbally, it shall notify CITY of the confidential nature of the information in
writing prior to or immediately after verbally conveying the information. In
addition to the foregoing requirements, each item of Confidential Information
provided either in documentary form or verbally shall be accompanied by a
writing stating the grounds for Poseidon's assertion that the information is of the
nature described in Section 6 below and is not within any of the exclusions listed
in clauses (a) through (d) in this Section. Poseidon shall have the right to
determine, in its sole judgment, what information it will provide to CITY.
Confidential Information shall not include the following:
(a) Information that, at the time of disclosure by Poseidon, is publicly
available or generally known or available to third parties, or information
that later becomes publicly available or generally known or available to
third parties through no act or omission by CITY;
(b) Information that CITY can demonstrate was in its possession prior to
disclosure by Poseidon;
(c) Information received by CITY from a third party who, to CITY's
knowledge and reasonable belief, did not acquire such information on a
confidential basis either directly or indirectly from Poseidon; and
(d) Information CITY can demonstrate was independently developed by
it or a third party or for it or a third party and that was not obtained, in
whole or in part, from Poseidon.
2. Disclosure and Use of Confidential Information. Unless required by State or
Federal law, CITY shall not, without Poseidon's prior written consent, disclose to
any third party, firm, corporation or entity such Confidential Information,
provided, however, CITY may discuss Confidential Information with other
Water Agenc(ies) that have entered into a confidentiality agreement with
Poseidon. Internally, CITY shall limit the disclosure of the Confidential
Information to only those officers, employees and agents (including its governing
board or committees, attorneys, accountants, bankers and consultants) of CITY
reasonably necessary to evaluate the Confidential Information and/or the Project.
If CITY internally evaluates Confidential Information and/or the Project with its
governing board or committees, CITY shall do so without disclosing the
Confidential Information in a public meeting, to the extent permitted by Section
54950 et seq. of the California Government Code. Should CITY staff determine
that a need exists to disclose Confidential Information in a public meeting, CITY
will notify Poseidon of this need and identify the information to be disclosed
prior to posting the agenda for the meeting. CITY shall use the Confidential
Information received from Poseidon under this Agreement only for the purpose
of its internal evaluation of the Project. In complying with its obligations under
this Agreement, CITY shall use reasonable means to prevent unauthorized
disclosure and to protect the confidentiality of the Confidential Information.
Notwithstanding CITY's exercise of its right to discuss Confidential Information
with another Water Agenc(ies) that have entered into a confidentiality agreement
with Poseidon, CITY shall not have any obligation with regard to limiting or
preventing disclosure of Confidential Information by such other Water
Agenc(ies) or with regard to such other Water Agenc(ies)' performance of their
confidentiality agreements, and CITY's and such other Water Agenc(ies)'
obligations under their respective confidentiality agreements shall not be
construed as joint and several.
3. Required Disclosure. In the event CITY is requested or required by any provision
of State or Federal law, oral questions, interrogatories, requests for information
or documents, subpoena, civil investigation, demand or similar process to
disclose any Confidential Information received pursuant to this Agreement,
CITY will notify Poseidon immediately of such request(s).
4. Return of Documents. Either Party may elect at any time to terminate this
Agreement. CITY will return any and all Confidential Information upon written
request from Poseidon, including all originals, copies, translations, transcriptions
or any other form of said material, without retaining any copy or duplicate
thereof. To the extent permitted by law and if Poseidon has not requested the
return thereof pursuant to the preceding sentence, CITY shall promptly destroy
any and all electronic and hardcopy versions of Confidential Information, as well
as any documents consisting of excerpts or portions of materials previously
identified by Poseidon as Confidential Information. CITY will not retain any
Confidential Materials in its agency files.
5. Survival of Obligations. Regardless of any termination of any business
relationship between the Parties, the obligations and commitments established by
this Agreement shall remain in full force and effect for four (4) years from the
day and year first hereinabove written or until such time as the Parties have
entered into an agreement providing otherwise.
6. Nature of Information. CITY hereby accepts the representations of Poseidon that
the Confidential Information is of a special, unique, unusual, extraordinary, and
intellectual character, that money damages would not be a sufficient remedy for
any breach of this Agreement by CITY, and that specific performance and
injunctive or other equitable remedies for any such breach shall be available to it.
The Parties also acknowledge that the interests of Poseidon in such Confidential
Information may be irreparably injured by disclosure of such Confidential
Information. The remedy stated above may be pursued in addition to any other
remedies applicable at law or equity for breach of this Agreement. Should
litigation be instituted to enforce any provision hereof, the Party that prevails will
be entitled to recover all costs, including reasonable legal fees, expert costs and
costs of investigation.
7. Governing Law. The laws of the State of California shall govern this Agreement.
8. No Other Agreement. It is expressly understood that this Confidentiality
Agreement is not and shall not be construed as any form of a letter of intent or
agreement to enter into any type of transaction.
9. No License or Rights. Neither this Agreement, nor the transfer of Confidential
Information hereunder, shall be construed as granting to CITY any license or
rights to any information or data now or hereafter owned or controlled by
Poseidon.
10. Except as may be required by law, without the prior consent of Poseidon, CITY
will not (a) confirm or deny any statement made by a third party regarding the
Confidential Information, (b) disclose to any person the fact that Confidential
Information has been made available to it by Poseidon, or (c) disclose any of the
terms or conditions of this Agreement.
IN WITNESS WHEREOF, the Parties hereto have entered into this Agreement on the
day and year first herein above written.
APPROVED AS TO FORM:
OFFICE OF THE CITY ATTORNEY
Leonie H. Mulvihill,
Assistant City Attorney
ATTEST:
Leilani I. Brown,
City Clerk
CITY OF NEWPORT BEACH,
A Municipal Corporation
David Kiff,
City Manager
Poseidon Resources (Surfside),
LLC
M
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