HomeMy WebLinkAboutOB Reso 07-2016File Number: 16 -875
City of South San Francisco P.O. Box 711 (City Hall,
400 Grand Avenue)
South San Francisco, CA
Oversight Board
Resolution: RES 07 -2016
Enactment Number: RES 07 -2016
RESOLUTION APPROVING A SALE PRICE OF $3,500,000 AS PART
OF AN EXCLUSIVE NEGOTIATING RIGHTS AGREEMENT (ENRA)
BETWEEN THE SOUTH SAN FRANCISCO SUCCESSOR AGENCY,
THE CITY OF SOUTH SAN FRANCISCO AND HISENSE REAL
ESTATE (USA) LLC FOR THE PROPERTIES LOCATED AT 200
LINDEN, 212 BADEN, AND 216 BADEN AVENUE (APNS
012 - 334 -130, 012 - 334 -160, 012- 334 -030 AND 012- 334 -040).
WHEREAS, on June 29, 2011 the legislature of the State of California (the "State ") adopted Assembly
Bill 26 ( "AB 26 "), which amended provisions of the Redevelopment Law; and
WHEREAS, pursuant to AB 26 and the California Supreme Court decision in California Redevelopment
Association, et al. a Ana Matosantos, et al., which upheld AB 26 (together with AB 1484, the
"Dissolution Law "), the Redevelopment Agency was dissolved on February 1, 2012; and
WHEREAS, pursuant to the Dissolution Law, the South San Francisco Successor Agency ( "Agency ")
prepared a Long Range Property Management Plan ( "LRPMP "), which was approved by a resolution of
the Oversight Board for the Successor Agency to the Redevelopment Agency of the City of South San
Francisco ( "Oversight Board ") on May 21, 2015 and was approved by the California Department of
Finance ( "DOF ") on October 1, 2015; and
WHEREAS, the Agency is the owner of certain property certain real property (the "Property") located in
the City of South San Francisco, California, known as County Assessor's Parcel Numbers ( "APN ")
012- 334 -130 (200 Linden Avenue), 012 - 334 -160 (216 Baden Avenue), 012 - 334 -040 and 012- 334 -030
(212 Baden Avenue); and
WHEREAS, the Property is included in the LRPMP and is identified as part of an Approved
Redevelopment Plan; and
WHEREAS, the LRPMP identifies the Property for disposition and development consistent with those
redevelopment plans; and
WHEREAS, consistent with the LRPMP, the Agency is interested in selling the Property to Hisense Real
Estate (USA), LLC, a California limited liability company ( "Developer ") contingent upon Developer
preparing all appropriate environmental review documents, and applying for land use entitlements from
the City of South San Francisco, and if such entitlements are granted constructing approximately 87
multi- family residential units ( "Project ") on the Property; and
Page 1
File Number: 16 -875
Enactment Number: RES 07 -2016
WHEREAS, the Developer has requested the exclusive right to collaborate and negotiate with the
Agency for the purpose of reaching agreement on a project description, appropriate land uses, economic
feasibility, and a definitive agreement whose terms and conditions would govern any conveyance of the
Property and the development of the Property; and
WHEREAS, Agency desires to grant Developer the exclusive right to collaborate and negotiate with
Agency with regard to development of the Property.
NOW, THEREFORE, BE IT RESOLVED that the Oversight Board for the Successor Agency to the
Redevelopment Agency for the City of South San Francisco does hereby take the following actions:
(1) Finds and determines that the recitals are true and correct.
(2) Approves the total sale price of $3,500,000 as part of an Exclusive Negotiating Rights Agreement
(ENRA) between the South San Francisco Successor Agency, the City of South San Francisco and
Hisense Real Estate (USA) LLC for the properties located at 200 Linden, 212 and 216 Baden Avenue
(APNs 012- 334 -130, 012 - 334 -160, 012 - 334 -030 and 012 - 334 -040), in substantially the same form
attached hereto as Exhibit A.
(3) The Agency's Executive Director or his designee is hereby authorized to execute the ENRA on
behalf of the Successor Agency; to make revisions to the ENRA, with review and approval by the
Agency's Counsel, which do not materially or substantially increase the Agency's obligations
thereunder; to sign all documents; to make all approvals and take all actions necessary or appropriate to
carry out and implement the intent of this Resolution.
At a meeting of the Special Oversight Board to the Successor Agency to the Former Redevelopment
Agency on 11/22/2016, a motion was made by Paul Scannell, seconded by Mark Addiego, that this
Resolution be approved. The motion passed.
Yes: 6 Cullen, Addiego, Christensen, Farrales, Scannell, and Friedman
Absent: 1 Krause
Attest . by
�faMa inell'
Page 2
EXHIBIT A
EXCLUSIVE NEGOTIATING RIGHTS AGREEMENT
by and amongst
HISENSE REAL ESTATE (USA), LLC,
SOUTH SAN FRANCISCO SUCCESSOR AGENCY,
and
CITY OF SOUTH SAN FRANCISCO
EXCLUSIVE NEGOTIATING RIGHTS AGREEMENT
HISENSE REV. 11 -3 -16
THIS EXCLUSIVE NEGOTIATING RIGHTS AGREEMENT (this "Agreement" or
"ENRA ") is entered into by and between the SOUTH SAN FRANCISCO SUCCESSOR
AGENCY, a public agency ( "Agency "), HISENSE REAL ESTATE (USA), LLC, a California
limited liability company ( "Developer"), and the CITY OF SOUTH SAN FRANCISCO, a
municipal corporation ( "City "), dated as of November 22, 2016 (the "Effective Date "), which is
the date this Agreement was approved by the South San Francisco Oversight Board ( "Oversight
Board "). Agency, Developer, and City are each referred to as "Party" or collectively referred to
as the "Parties."
WHEREAS, the Agency is the owner of certain property certain real property (the
"Property ") located in the City of South San Francisco, California, known as County Assessor's
Parcel Numbers ( "APN ") 012- 334 -130 (200 Linden Avenue), 012 - 334 -160 (216 Baden Avenue),
012- 334 -040 and 012- 334 -030 (212 Baden Avenue), as more particularly described in Exhibit A
attached hereto and incorporated herein by this reference; and,
WHEREAS, the Property was transferred from the City of South San Francisco to the
Agency pursuant to Grant Deeds recorded on March 11, 2011 ; and,
WHEREAS, on June 29, 2011 the legislature of the State of California (the "State ")
adopted Assembly Bill xl 26 ( "AB 26 "), which amended provisions of the Redevelopment Law;
and,
WHEREAS, pursuant to AB 26 and the California Supreme Court decision in California
Redevelopment Association, et al. v. Ana Matosantos, et al., which upheld AB 26 (together with
AB 1484, the "Dissolution Law "), the Agency was dissolved on February 1. 2012; and,
WHEREAS, pursuant to the Dissolution Law, the Agency has prepared and the Oversight
Board and DOF has approved a Long Range Property Management Plan ( "LRPIVIP "); and,
WHEREAS, the Parties acknowledge that it is the intention of the Agency and the City,
following execution of the Master Agreement for Taxing Entity Compensation by all Taxing
Entities, that the Agency will transfer the Property to the City, pursuant to the provisions of the
LRPMP; and,
WHEREAS, the Agency and ultimately, the City, are interested in selling the Property
to Developer contingent upon Developer supplying a Letter of Interest ( "LOI "), preparing all
appropriate environmental review documents, and applying for land use entitlements from the
City and if such entitlements are granted constructing approximately 87 multi - family residential
units ("Project ") on the Property; and,
WHEREAS, Developer anticipates expending funds to prepare environmental review
documents, architectural and design drawings and conduct certain studies that are needed to assess
the feasibility of the Project, consistent with the Downtown Station Area Plan ( "DSA "),
Environmental Impact Report ( "EIR ") and Rezoning ( "Rezoning "), and requires a grant of
exclusive negotiating rights in order to be willing to make such expenditures; and
EXCLUSIVE NEGOTIATING RIGHTS AGREEMENT
HISENSE REV. 11 -3 -16
M
WHEREAS, at its meeting on November 7, 2016 the Agency and City approved this
Agreement and directed staff to negotiate a Purchase and Sale Agreement ( "Purchase
Agreement ") for the Property with Developer; and
WHEREAS, the Oversight Board approved the sale price contained within this Agreement
on .2016.
NOW THEREFORE, in consideration of the mutual covenants and agreements
hereinafter set forth and other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the Parties agree as follows.
1. Good Faith Efforts to Negotiate. The Parties will use their best efforts to successfully
negotiate (i) a Purchase Agreement which will describe the terms and conditions governing
the purchase of the Property by Developer, and (ii) a Development Agreement between the
City and Developer that will set forth requirements and entitlements for the Project. The
Parties will diligently and in good faith pursue such negotiations. Furthermore, the Parties
will use their best efforts to obtain any third -party consent, authorization, approval, or
exemption required in connection with the transactions contemplated hereby. This
Agreement does not impose a binding obligation on Agency to convey any interest in the
Property to Developer, nor does it obligate City to grant any approvals or authorizations
required for the Property or any project or improvements constructed thereon.
a. If Developer has not continued to negotiate diligently and in good faith, Agency
will give written notice thereof to Developer who will then have ten (10) business
days to commence negotiating in good faith. Following the failure of Developer to
thereafter commence negotiating in good faith within such ten (10) business day
period, this Agreement may be terminated by Agency. If this Agreement is
terminated by Agency pursuant to the above sentence, Developer acknowledges
and agrees that Agency will suffer damages, including lost opportunities to pursue
other development alternatives for the Property and delayed receipt of property tax
revenues from the Property, and that it is impracticable and infeasible to fix the
actual amount of such damages. Therefore, the Parties agree that if this Agreement
is terminated as provided above, Agency will retain fifty thousand dollars ($50,000)
of the Payment (as defined in Section 5 of this Agreement, infra), plus any interest
thereon, as fixed and liquidated damages and not as a penalty, and following such
termination neither Party will have any further rights against or liability to the other
under this Agreement.
b. If Agency has not continued to negotiate diligently and in good faith, Developer
will give written notice thereof to Agency which will then have ten (10) business
days to commence negotiating in good faith. Following the failure of Agency to
thereafter commence negotiating in good faith within such ten (10) business -day
period, this Agreement may be terminated by Developer. In the event of such
termination by Developer, Agency will return one hundred (100) percent of the
Payment to Developer in accordance with the provisions of Section 5 of this
Agreement, and neither Party will have any further rights against or liability to the
other under this Agreement.
EXCLUSIVE NEGOTIATING RIGHTS AGREEMENT
HISENSE REV. 11 -3 -16
C. If, notwithstanding Agency's and Developer's mutual diligent, good faith
negotiations, the Parties have not entered into a Purchase Agreement on or before
expiration of the Term of this Agreement (as defined in Section 3 of this Agreement)
or any extension thereof, Agency will return the Payment to Developer in
accordance with the provisions of Section 5 of this Agreement, and neither Party
will have any further rights against or liability to the other under this Agreement.
d. If performance of this Agreement results in execution of a Purchase Agreement,
the Agency will apply any unused portion of the Payment to either the agreed -
upon deposit or purchase price requirement of the Purchase Agreement.
2. Developer's Exclusive Right to Negotiate With Agency. Agency agrees that it will not,
during the term of this Agreement, directly or indirectly, through any officer, employee,
agent, or otherwise, solicit, initiate or encourage the submission of bids, offers or proposals
by any person or entity with respect to the acquisition of any interest in the Property or the
development of the Property, and Agency will not engage any broker, financial adviser or
consultant to initiate or encourage proposals or offers from other parties with respect to the
disposition or development of the Property or any portion thereof.
Furthermore, Agency will not, directly or indirectly, through any officer, employee, agent
or otherwise, engage in negotiations concerning any such transaction with, or provide
information to, any person other than Developer and its representatives with a view to
engaging, or preparing to engage, that person with respect to the disposition or
development of the Property or any portion thereof.
3. Term.
a. The term of this Agreement ( "Term ") commences on the Effective Date, and will
terminate seven (7) months from the Effective Date, unless extended or earlier
terminated as provided herein.
b. Developer and the Agency agree to the Schedule of Performance that is attached
hereto as Exhibit B.
C. During the Negotiating Period Developer shall conduct due diligence activities,
including but not limited to preparation of Planning Application, soils report,
hazardous materials report, financial feasibility and title adequacy.
d. During the Term, Developer will provide Agency with progress reports a minimum
of every sixty (60) days with respect to Developer's due diligence review of the
Property, commencement of environmental requirements under CEQA, preparation
of architecture and construction plans, and general progress toward development of
the Property.
e. The Term of this Agreement may be extended for up to a maximum of sixty (60)
additional days upon the payment by Developer of twenty five thousand dollars
($25,000). The Agency shall not have any discretion to deny or refuse this extension
EXCLUSIVE NEGOTIATING RIGHTS AGREEMENT
HISENSE REV. 11 -3 -16
upon receipt of the payment, but rather the extension shall be mandatory upon such
payment.
4. Relationship of the Parties. Nothing in this Agreement creates between the Parties the
relationship of lessor and lessee, of buyer and seller, or of partners or joint venturers.
5. Payment for Agency.
a. In consideration for this Agreement and the costs the Agency has and will incur in
furtherance of this Agreement and the negotiation of the Purchase Agreement,
Developer will, within five (5) days of the Effective Date, submit to Agency a good
faith deposit ( "Payment ") in the amount of Three Hundred Thousand Dollars
($300,000) in immediately available funds. Agency will deposit the Payment in an
interest bearing account of the Agency and any interest, when received by Agency,
will become part of the Payment..
b. This $300,000 Payment will consist of a non - refundable $15,000 ENRA fee, and a
refundable $35,000 as security for the Agency's costs. The remaining $250,000
shall be fully refundable without deduction for costs, although a partial deduction
may be made for damages as provided in Section 1(a) of this Agreement. The
$15,000 fee will compensate the Agency for staff costs to implement the
Agreement. Costs that may be covered by the $35,000 security will be determined
in good faith by negotiation between the Parties.
C. Agency agrees to account for deposit, interest earnings, and any expenditures made
related to the execution of this Agreement consistent with all reporting
requirements of the DOF.
The Agency will notify the Developer of the identity, qualifications, scope of work,
and budget for any third party consultants that the Agency wishes to pay for out of
the $35,000 costs security deposit, prior to authorizing work under any contract
with such third party. The Agency will provide Developer a written account of
such proposed payments, including copies of any third party invoices under
approved scopes of work (not including any information subject to attorney client
privilege).
d. Any amount remaining from the Payment after expiration of the Term of this
Agreement or execution of a Purchase Agreement, whichever comes first, and
taking into account expenditures authorized by Section 5(b) above, will be disposed
of as provided in Section 1 of this Agreement.
e. In addition to Agency's costs discussed herein, Developer shall be subject to all
applicable fees imposed by the City for processing land use entitlements as set forth
in the City's current adopted Master Fee Schedule and any applicable cost recovery
and indemnification agreements.
6. Terms and Conditions of the Purchase Agreement.
EXCLUSIVE NEGOTIATING RIGHTS AGREEMENT
HISENSE REV. 11 -3 -16
The Parties agree to use their best efforts to successfully negotiate a Purchase
Agreement including, but not limited to, the lease terms, rental payments, terms of
the purchase and the option price. The Parties agree the terms shall be generally
based on those set forth herein and in Exhibit C and Exhibit D attached hereto and
incorporated herein by this reference.
7. Developer's Studies; Right of Entry.
a. During the Term of this Agreement, Developer will use its best efforts to prepare,
at Developer's expense, any studies, surveys, plans, specifications and reports
("Developer's Studies ") Developer deems necessary or desirable in Developer's
sole discretion, to complete its due diligence for the Property. Developer's Studies
may include, without limitation, title investigation, marketing, feasibility, soils,
seismic and environmental studies, financial feasibility analyses and design studies.
The Developer will have rights of access to the Property to prepare the Developer's
Studies.
b. The Developer and its consultants shall have the right to enter upon the Property
during normal business hours to conduct investigations in accordance with this
Agreement. In connection with such entry and investigation, the Developer shall:
(i) give the Agency and City, or its designee at least 48 hours' advance notice; (ii)
repair and restore any damage Developer may cause; and (iii) carry liability
insurance covering the right of entry naming the City as an additional insured.
C. Developer will provide the Agency with work plans, drawings, and descriptions of
any intrusive sampling it intends to do. Developer must keep the Property in a safe
condition during its entry. Developer shall repair, restore and return the Property to
its condition immediately preceding Developer's entry thereon at Developer's sole
expense.
d. Without limiting any other indemnity provisions set forth in this Agreement,
Developer shall indemnify, defend (with counsel approved by Agency) and hold
the Agency, its officials, officers, employees, consultants, contractors and
volunteers ( "Agency Indemnitees ") harmless from and against all claims resulting
from or arising in connection with entry upon the Property by Developer or
Developer's agents, employees, consultants, contractors or subcontractors pursuant
to this Section 7; provided however, Developer will have no indemnification
obligation with respect to the gross negligence or willful misconduct of any Agency
Indemnitees. Developer's indemnification obligations set forth in this Section 7
shall survive the termination of this Agreement and shall apply to any claims filed
against the Agency within eighteen months of termination of this Agreement.
e. If upon expiration of the Term of this Agreement the Parties have not successfully
negotiated a Purchase Agreement, Developer will provide Agency within fifteen
(15) days following said date of expiration copies of the Developer's Studies
completed by such date, not including the intellectual property of Developer,
provided that the Agency first delivers to Developer payment in full for all of
Developer's actual costs paid to vendors who prepared these Developer's Studies.
EXCLUSIVE NEGOTIATING RIGHTS AGREEMENT
HISENSE REV. 11 -3 -16
Developer will also provide Agency with copies of any Developer's Studies
completed after the expiration of the Term within fifteen (15) days following
completion of such studies, or if Developer intends not to complete any
Developer Studies, Developer will provide Agency with copies of such
uncompleted studies, again provided that the Agency first delivers to Developer
payment in full for all of Developer's actual costs paid to vendors who prepared
these Developer's Studies.
L Letter of Interest. Within one hundred and eighty days (180) following the
Effective Date, Developer will provide Agency with a LOI from retail tenants for
the occupation of some or all of the ground floor commercial space.
8. Agency's Reports and Studies. Within twenty (20) days following the Effective Date,
Agency will make available to Developer for review or copying at Developer's expense all
nonprivileged studies, surveys, plans, specifications, reports, and other documents with
respect to the Property that Agency has in its possession or control, which have not already
been provided. Studies or documents prepared by Agency and its agents solely for the
purpose of negotiating the terms of a Purchase Agreement are not required to be provided
by Agency to Developer and are excluded from this requirement
9. Developer's Pro Forma, Evidence of Financing and Schedule for Conveyance of Property
Following Potential Approval of a Purchase Agreement. At least 45 days prior to Agency
consideration of the Purchase Agreement, Developer will provide Agency with a pro forma
for the Project that confirms the financial feasibility of Developer's proposed development
of the Property and planned financing for the Project. The parties agree that the Purchase
Agreement will contain language that provides that not later than forty -five (45) days prior
to conveyance of the Property, Developer will provide evidence satisfactory to Agency that
Developer has secured binding commitments, subject only to commercially reasonable
conditions, for all funding necessary for the successful purchase of the Property and
completion of the Project, it being understood and agreed that such satisfactory funding
evidence shall include, without intending limitation, funds held in reputable banks located
outside the United States of America.
10. Full Disclosure. Developer is required to make full disclosure to Agency of its principals;
officers; major stockholders, partners or members; joint venturers; negotiators;
development managers; consultants and directly involved managerial employees
(collectively, "Developer Parties "); and all other material information concerning
Developer. Any change in the identity of the Developer Parties will be subject to the
approval of Agency, which will not be unreasonably withheld. Developer will make and
maintain full disclosure to Agency of its methods of financing to be used in the acquisition
and development of the Property.
11. Periodic Reporting to Governing Bodies. Agency will report periodically to the Agency
Board and/or the Oversight Board of the Successor Agency on the status of negotiations, and
Developer may be asked to attend such meetings to provide those bodies with a status update
of their development efforts related to this Agreement.
12. Reserved.
EXCLUSIVE NEGOTIATING RIGHTS AGREEMENT
HISENSE REV. 11 -3 -16
13. Confidentiality; Dissemination of Information. To the extent permitted by law, during the
term of this Agreement, each Party will obtain the consent of the other Party prior to issuing
or permitting any of its officers, employees or agents to issue any press release or other
information to the press with respect to this Agreement; provided however, no Party will
be prohibited from supplying any information to its representatives, agents, attorneys,
advisors, financing sources and others to the extent necessary to accomplish the activities
contemplated hereby so long as such representatives, agents, attorneys, advisors, financing
sources and others are made aware of the terms of this Section. Nothing contained in this
Agreement will prevent either Party at any time from furnishing any required information
to any governmental entity or authority pursuant to a legal requirement or from complying
with its legal or contractual obligations.
14. Execution of Purchase Agreement. The Agency has no legal obligation to grant any
approvals or authorizations for the sale of the Property or any development thereon until
the Purchase Agreement has been approved by the Agency, the South San Francisco
Oversight Board and the California Department of Finance, if necessary. Such
consideration and potential approval shall not occur until the Agency has completed,
considered and certified /approved any required CEQA environmental review documents.
15. Transfer of the Property from the Agency to the City. The Parties acknowledge that it is
the intention of the Agency and the City, following execution of the Master Agreement
Master Agreement for Taxing Entity Compensation by all of the Taxing Entities, that the
Agency will transfer all rights, title and interest Agency has in the Property to the City,
pursuant to the provisions of the LRPMP. If such a transfer is accomplished during the
Term of this Agreement, all references to Agency in this Agreement shall be replaced
with City and City shall assume all rights and obligations previously assigned to Agency
under this Agreement.
16. Termination.
a. This Agreement may be terminated at any time by mutual consent of the Parties.
b. Agency will have the right to terminate this Agreement upon its good faith
determination that Developer is not proceeding diligently and in good faith to carry
out its obligations pursuant to this Agreement. Agency will exercise such right in
accordance with the provisions set forth in Section 1 of this Agreement.
C. Developer will have the right to terminate this Agreement, in accordance with the
provisions set forth in Section 1 of this Agreement, if the results of its investigation
of the Property are unsatisfactory, in Developer's sole and absolute discretion, with
respect to Developer's desired development activities or if Developer is unable to
obtain other necessary approvals, rights or interests.
d. Neither Party will have the right to seek an award of damages as a result of the
termination of this Agreement pursuant to this Section.
17. Effect of Termination. Upon termination as provided herein, or upon the expiration of the
Term and any extensions thereof without the Parties having successfully negotiated a
EXCLUSIVE NEGOTIATING RIGHTS AGREEMENT
HISENSE REV. 11 -3 -16
Purchase Agreement, this Agreement will forthwith be void, and there will be no further
liability or obligation on the part of either of the Parties or their respective officers,
employees, agents or other representatives; provided however, the provisions of Section
13 (Confidentiality; Dissemination of Information), Section 19 (Indemnification), and
Section 23 (Brokers) will survive such termination. Provided further, that upon termination
or expiration of this Agreement without the Parties having successfully negotiated a
Purchase Agreement, Developer will deliver to Agency all of the Developer's Studies
pursuant to the provisions of Section 7 of this Agreement, including the condition stated in
Section 7 that the Agency must pay Developer for its actual costs in obtaining those Studies
before Developer is obligated to deliver them to Agency
18. Notices. Except as otherwise specified in this Agreement, all notices to be sent pursuant to
this Agreement will be made in writing, and sent to the Parties at their respective addresses
specified below or to such other address as a Party may designate by written notice
delivered to the other parties in accordance with this Section. All such notices will be sent
by any one or more of the following methods:
a. Personal delivery, in which case notice is effective upon delivery;
b. Certified or registered mail, return receipt requested, in which case notice will be
deemed delivered on receipt if delivery is confirmed by a return receipt;
C. Nationally recognized overnight courier, with charges prepaid or charged to the
sender's account, in which case notice is effective on delivery if delivery is
confirmed by the delivery service;
d. Email transmission to the email addresses noted below, in which case notice will
be deemed delivered upon transmittal, provided that a duplicate hard copy of the
email is promptly delivered by first -class or certified mail or by overnight delivery.
Agency /City: South San Francisco Successor Agency
400 Grand Avenue
South San Francisco, CA 94080
Attn: Agency Executive Director
Tel (650) 877 -8501
Email: mike. [email protected]
cc: julie.bamard @ssfnet
with a copy to: Meyers Nave
Attn: Jason Rosenberg
575 Market Street, Suite 2080
San Francisco, CA 94105
Tel (415) 421 -3711
Email: [email protected]
Developer:
EXCLUSIVE NEGOTIATING RIGHTS AGREEMENT
HISENSE REV. 11 -3 -16
with a copy to:
Hisense Real Estate (USA), LLC.
235 Grand Ave #203
South San Francisco, CA 94080
Attention: Kenneth Cui
Telephone: (650) 873 -2738
Email: kencui @yahoo.com
James Braden Law Offices
44 Montgomery Street, Suite 1210
San Francisco, CA 94104
Attention: James M. Braden
Telephone: (415) 398 -6865
Email: braden @ sf - lawyer.com
19. Indemnification. Developer hereby covenants, on behalf of itself and its permitted
successors and assigns, to indemnify, hold harmless and defend the Agency and the City
of South San Francisco and their elected and appointed officials, officers, agents,
representatives and employees ( "Indemnitees ") from and against all claims, costs
(including without limitation reasonable attorneys' fees and litigation costs) and liability,
arising out of or in connection with this Agreement and/or arising out of or in connection
with the Developer's access to and entry on the Property pursuant to Section 7 of this
Agreement; provided however, Developer will have no indemnification obligation with
respect to the gross negligence or willful misconduct of any Indemnitee.
20. Severability. If any term or provision of this Agreement or the application thereof will, to
any extent, be held to be invalid or unenforceable, such term or provision will be ineffective
to the extent of such invalidity or unenforceability without invalidating or rendering
unenforceable the remaining terms and provisions of this Agreement or the application of
such terms and provisions to circumstances other than those as to which it is held invalid
or unenforceable unless an essential purpose of this Agreement would be defeated by loss
of the invalid or unenforceable provision.
21. Entire Agreement; Amendments In Writing; Counterparts. This Agreement contains the
entire understanding of the Parties with respect to the subject matter hereof and supersedes
all prior and contemporaneous agreements and understandings, oral and written, between
the Parties with respect to such subject matter. This Agreement may be amended only by
a written instrument executed by the Parties or their successors in interest. This Agreement
may be executed in multiple counterparts, each of which will be an original and all of which
together will constitute one agreement.
22. Successors and Assigns; No Third -Party Beneficiaries. This Agreement will be binding
upon and inure to the benefit of the Parties and their respective successors and assigns;
provided however, that neither Party will transfer or assign any of such Party's rights
hereunder by operation of law or otherwise without the prior written consent of the other
Party, and any such transfer or assignment without such consent will be void.
Notwithstanding the foregoing, Developer is permitted to assign this Agreement without
EXCLUSIVE NEGOTIATING RIGHTS AGREEMENT
HISENSE REV. 11 -3 -16
such written consent, provided that Developer assigns this Agreement to (i) an entity that
is wholly controlled by Developer, or (ii) an entity in which the Developer is a member
and has day to day management responsibilities for such entity. Subject to the immediately
preceding sentence, this Agreement is not intended to benefit, and will not run to the benefit
of or be enforceable by, any other person or entity other than the Parties and their permitted
successors and assigns.
23. Brokers. Each Party warrants and represents to the other that no brokers have been retained
or consulted in connection with this transaction. Each Party agrees to defend, indemnify
and hold harmless the other Party from any claims, expenses, costs or liabilities arising in
connection with a breach of this warranty and representation. The terms of this Section will
survive the expiration or earlier termination of this Agreement.
24. Approvals. Unless otherwise provided in this Agreement, the Agency Executive Director
will be authorized to enter into all written approvals, consents or waivers by the Agency
without further authorization by the Agency Board. Nothing herein, however, will be
deemed to prevent the Agency Executive Director from requesting formal approval by the
Agency Board if the Agency Executive Director, in his or her sole discretion, determines
to seek such approval.
25. Captions. The captions of the sections and articles of this Agreement are for convenience
only and are not intended to affect the interpretation or construction of the provisions
hereof.
26. Governing Law. This Agreement will be governed by and construed in accordance with
the laws of the State of California.
27. _Dispute Resolution. Any controversy, dispute or claim related to or arising from this
Agreement or in any way arising from the dealings of the parties with one another, shall be
resolved by the following steps in the following sequence:
(A) By non - binding Mediation before, and in accordance with the rules of, the Judicial
Arbitration and Mediation Services ( "JAMS "), conducted by a retired Judge, with
exclusive venue in San Francisco, California and in no other place.
(B) If that Mediation fails to resolve the dispute, then by binding Arbitration before, and
in accordance with the rules of, JAMS, conducted by a retired Judge, with exclusive venue
in San Francisco, California and in no other place. In any such arbitration, the prevailing
party shall be entitled to an award of reasonable attorney's fees and costs.
IN WITNESS WHEREOF, the Parties have executed this Agreement as of the date first written
above.
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AGENCY
By:
Mike Futrell
Agency Executive Director
ATTEST:
By:
Agency Clerk
APPROVED AS TO FORM:
By:
Jason Rosenberg
Agency Counsel
CITY
By:
Mike Futrell
City Manager
ATTEST:
By:
City Clerk
APPROVED AS TO FORM:
By:
Jason Rosenberg
City Attorney
DEVELOPER
By:
Developer representative name:
APPROVED AS TO FORM:
By:
James M. Braden
Attorney Developer
EXCLUSIVE NEGOTIATING RIGHTS AGREEMENT
HISENSE REV. 11 -3 -16
EXHIBIT A
PROPERTY
The land referred to is situated in the County of San Mateo, City of South San Francisco, State of
California, and is described as follows:
PARCEL ONE:
Lot 8, Block 140, as delineated upon that certain Map entitled "South San Francisco, San Mateo
County, California ", filed for record in the office of the Recorder of the County of San Mateo,
State of California, on March 1 st, 1892 in Book "B" of Maps, at Page 6, and a copy entered in
Book 2 of Maps at Page 52.
APN: 012 - 334 -030 JPN: 012- 033 - 334 -03
PARCEL TWO:
Lots 6 and i, Block 140, as delineated upon that certain Map entitled "South San Francisco, San
Mateo County, California ", filed for record in the office of the Recorder of the County of San
Mateo, State of California, on March 1 st, 1892 in Book "B" of Maps, at Page 6, and a copy
entered in Book 2 of Maps at Page 52.
APN: 012 -334 -040 JPN: 012 - 033- 334 -04
PARCEL THREE:
Lots 11, 12, 13 and 14 in Block 140, as shown on that certain Map entitled "South San
Francisco, San Mateo Co. Cal., Plat No. 1 ", filed for record in the office of the Recorder of the
County of San Mateo on March 1, 1892 in Book "B" of Maps, at Page 6, and copied into Book 2
of Maps at Page 52.
APN: 012 - 334 -130 JPN: 012- 033 - 334 -13
PARCEL FOUR:
Lots 9 and 10 in Block 140, as shown on that certain Map entitled "South San Francisco San
Mateo Co. Cal. Plat No. 1 ", filed in the office of the County Recorder of San Mateo County,
State of California, on March 1, 1892, in Book "B" of Maps, at Page 6 and copied into Book 2 of
Maps, at Page 52.
APN: 012 - 334 -160 JPN: 012- 033 - 334 -16
EXCLUSIVE NEGOTIATING RIGHTS AGREEMENT
HISENSE REV. 11 -3 -16
EXHIBIT B
SCHEDULE OF PERFORMANCE
Oversight Board Meeting — ENRA Approved
November 22, 2016
ENRA signed by all Parties
November 23, 2016
Expiration of seven (7) Month Exclusive Negotiating Period for
Purchase and Sale Agreement
June 23, 2017
Additional 60 day administrative extension (if necessary)
August 22, 2017
EXCLUSIVE NEGOTIATING RIGHTS AGREEMENT
HISENSE REV. 11 -3 -16
EXHIBIT C
DEVELOPMENT PROPOSAL
Criteria
Hisense Terms
Land Purchase Price Offered
$3,500,000
Deposit
$300,000
Prevailing Wages for Construction
Yes
Property APNs
• 012- 334 -130
• 012 - 334 -160
• 012- 334 -040
• 012 - 334 -030
Development Type
Condominium housing with ground floor
commercial.
Proposed Number of Units
87 Total units
Unit Size Composition
• 12 One - bedroom, one bathroom
• 40 Two- bedroom, one bathroom
• 25 Two bedroom, two bathroom
• 10 Three - bedroom, two bathroom
Affordable Units
20% BMR would be required as per the City's
Inclusionary Housing Ordinance (17 units)
Retail Space
Ground Floor commercial including a drug store
Project Amenities
To be determined
Parking
102 parking spaces
Developer's Equity Stake
100%
Project Entitlement/ Purchase Agreement
• 10 months for entitlements
Consideration and Construction Period
• Spring 2018
• 12 months for construction
Project Phasing
To be confirmed in ENRA period
EXCLUSIVE NEGOTIATING RIGHTS AGREEMENT
HISENSE REV. 11 -3 -16
Offsite Public Improvements Make a contribution in an amount to be
determined during negotiation of Purchase
Agreement for offsite improvements (which will
also be identified during project entitlement
process and Purchase Agreement).
EXCLUSIVE NEGOTIATING RIGHTS AGREEMENT
HISENSE REV. 11 -3 -16
EXHIBIT D
Term Sheet for 200 Linden Avenue
Exclusive Negotiating Rights Agreement (ENRA) Term Sheet
➢ Deposit Terms: $300,000
Date: within five days after ENRA execution (November 28, 2016)
Payment: City's bank account (title company is an option)
Refundability: $ 250,000 refundable if City terminates any and all agreements
due to developer non - performance. $ 300,000 (full amount)
refundable if developer terminates any and all agreements due
to City non - performance
➢ ENRA term: Seven months with one 60 day extension obtainable
• Payment of a further $ 25,000
➢ Project schedule: Prior to ENRA expiration. Developer to submit project schedule
delineating pre - development phases through completion of
construction drawings. Subsequent phases estimating key
milestones through completion of construction should also be
reflected.
➢ Corporate structure /development team to be confirmed.
➢ Financing and equity.
➢ Owner occupancy consistent w /Fannie Mae and Freddie Mac guidelines.
➢ Ground floor retail: Good Faith Efforts- broker to secure LOI's from the desired
tenants within 180 days of ENRA execution (e.g. Walgreen's or
small market). Additionally, restaurants or other retail tenant
types can be included in the preferred categories. Personal and
financial services commercial uses may be prohibited.
Developer to provide retail progress reports every 60 days
delineating tenants contacted, their contact information and
outcome of contact.
➢ 35% of concept drawings to be completed by ENRA expiration.
➢ Planning entitlement application to be submitted to Planning by ENRA expiration.
➢ Purchase and Sale Agreement finalized.
➢ Draft Pro -forma submission ahead of ENRA expiration.
2723861.2
EXCLUSIVE NEGOTIATING RIGHTS AGREEMENT
HISENSE REV. 11 -3 -16