Loading...
The URL can be used to link to this page
Your browser does not support the video tag.
Home
My WebLink
About
Reso 58-2000
RESOLUTION NO. 58-2000 CITY COUNCIL, CITY OF SOUTH SAN FRANCISCO, STATE OF CALIFORNIA A RESOLUTION AUTHORIZING THE EXECUTION OF A DISPOSITION AND DEVELOPMENT AGREEMENT BETWEEN THE REDEVELOPMENT AGENCY OF THE CITY OF SOUTH SAN FRANCISCO, THE CITY OF SOUTH SAN FRANCISCO AND ROBERT AND KATHLEEN GIORGI WHEREAS, the approval of the Disposition and Development Agreement with Robert and Kathleen Giorgi will provide the basis for the development of a new retail anchor furniture store downtown; and NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of South San Francisco that the City Council hereby authorizes the execution of a Disposition and Development Agreement between the Redevelopment Agency of the City of South San Francisco, the City of South San Francisco and Robert and Kathleen Giorgi. I hereby certify that the foregoing Resolution was regularly introduced and adopted by the City Council of the City of South San Francisco at a Regular meeting held on the 14th day of June ,2000 by the following vote: AYES: Councilmembers Pedro Gonzalez, Eugene R. Mullin and John R. Penna, Mayor Pro Tem Joseph A. Fernekes and Mayor Karyl Matsumoto NOES: None. ABSTAIN: None. ABSENT: None. F:\File Cabinet\RESO\giorgiagr.cc.doc ATTEST: ity Clerk DISPOSITION AND DEVELOPMENT AGREEMENT by and among THE REDEVELOPMENT AGENCY OF THE CITY OF SOUTH SAN FRANCISCO, THE CITY OF SOUTH SAN FRANCISCO and ROBERT & KATHLEEN GIORGI Disposition and Development Agreement (Giorgi) 06/09/00 000 9 TI-ilS DISPOSITION AND DEVELOPMENT AGREEMENT is made on or as of this day of ,2000, by and between the Redevelopment Agency of the City of South San Francisco (hereinat~er "AGENCY"), City of South San Francisco (hereinafter "CITY" and Robert and Kathleen Giorgi. (PARTICIPANT") (Collectively, the "Parties"). WITNESSETH: 1. Pursuant to its authority granted under California law, the Redevelopment Agency has the responsibility to carry out the City of South San Francisco Downtown Central Redevelopment Project, which was approved and adopted on July 12, 1989, by the City Council of the City of South San Francisco by Ordinance No. 1056-89, as amended. Said redevelopment plan as described and as thereafter from time to time amended is referred to herein as "the Redevelopment Plan" and is incorporated into this Agreement by reference. Any amendments to the Redevelopment Plan which change the uses or development permitted on the Property or otherwise change the restrictions or controls that apply to the Property shall require the written consent of the Developer which consent shall not be unreasonably withheld. Amendments to the Redevelopment Plan applying to other property in the Project Area shall not require the consent of the Developer. 2. In furtherance of the Redevelopment Plan, the Agency entered into an Exclusive Negotiating Rights Agreement dated December 22, 1999 with the Participant to determine whether an exchange of property between the Agency and Participant would be feasible for the construction of a 45,000 square foot retail furniture store on property owned by the City and Agency adjacent to Participant's property on Baden Avenue. The CITY, AGENCY and PARTICIPANT have determined that it is feasible for the development of the aforementioned properties for a project which shall include a 45,000 square foot retail furniture store within the City of South San Francisco and more particularly described on the attached Exhibit A incorporated herein by reference. The real property, which is located in an area governed by the Downtown Central Redevelopment Plan, is hereinafter referred to as the "Property" and consists of parcel numbers: APN 012-335-090 (Agency), APN 012-335-620 (City) and APN 012-334-040 (Participant). Upon completion of the land exchanges anticipated herein, the new development will take place on the CITY and AGENCY parcels adjacent to the PARTICIPANT'S property. The Property as described in Exhibit A is the real property shown on the Development Plan attached as Exhibit B incorporated herein by reference. It is contemplated that the Development Plan will be revised and refined into the Final Development Plan in accordance with Section 1.03 below. 3. The purposes of this Agreement are to provide a mechanism whereby the PARTICIPANT shall exchange property with the CITY and AGENCY in order to develop the Prop,erty in accordance with this &greement and to effectuate the provisions of the Downtown Central Redevelopment Plan. The development of the Property contemplated by this Agreement is consistent with the Downtown Central Redevelopment Plan and the City of South San Francisco General Plan. Disposition and Development Page 1 of 21 Agl'eement (Giorgi) 06/09/00 0 0 0 4. The Agency has concluded that the PARTICIPANT has the necessary expertise, skill and ability to carry out the commitments herein contained and that this Agreement is in the best interests and will materially contribute to the Redevelopment Plan. PART ONE: PROJECT Article One: PARTICIPANT'S PRE-DISPOSITION REQUIRE~S 1.01 Conditions Precedent. As a condition precedent to the AGENCY'S and CITY'S obligation to convey to PARTICIPANT the Property acquired by the AGENCY and CITY and PARTICIPANT'S obligation to convey Property acquired by PARTICIPANT and PARTICIPANT'S commencement of construction, the conditions set forth in this Article One must first be met by the date as set forth in this Part relevant for such condition, unless such time limit is extended by the AGENCY or the Agency's Executive Director. 1.02 ApproVal of Development Plan. Prior to the execution of this Agreement, the PARTICIPANT duly submitted to the CITY a Development Plan for the development of the Property. The City's Planning Commission approved a conditional use permit for the Development Plan on June 1, 2000. By execution of this Agreement the AGENCY hereby approves said Plan. The Development Plan calls for the development of a 45,000 square foot retail furniture store and the construction of certain improvements to the Property in connection therewith (referred to herein as the "Improvements"). 1.03 Development Plan. Developer shall submit to the AGENCY a Development Plan for the Improvements. The Development Plan shall be substantially consistent with the Redevelopment Plan and shall set forth in drawings and elevations, size and location of building, the number and location of parking spaces, the specific treatment and location of all landscaping amenities, the location of all pedestrian and automobile ingress and egress points, and the location of other public improvements. When the Development Plan is approved by the AGENCY, it shall form a part of this Agreement. Any change, modification, revision or alteration of the approved Development Plan shall be submitted for approval by the AGENCY; if not so approved, the approved Development Plan shall continue to control. Any proposed change, modification, revision or alteration shall be approved or disapproved by the AGENCY within fifteen (15) days of submittal and, if not approved or disapproved within said fifteen (30) day period, shall be deemed approved. Disposition and Development Page 2 of 21 Agreement (Giorgi) 06/0~/00 0 0 0 4 1.04 Construction Plans. PARTICIPANT shall submit to the AGENCY its Construction Plans for the Improvements within sixty (60) days after the exchange of the subject parcels has been completed. As used herein "Construction Plans" mean all construction documentation upon which the PARTICIPANT, and PARTICIPANT'S several contractors, shall rely in building the Improvements (including landscaping, parking, and common and public areas) and shall include, but not necessarily be limited to, final architectural drawings, landscaping plans and specifications, final elevations, building plans and specifications (also known as "working drawings") and a time schedule for construction. The Construction Plans shall be based upon the approved Development Plan and shall not materially deviate therefrom without the express written consent of the AGENCY. 1.05 Construction Financing Plan. (a) At the time PARTICH'ANT is required to submit the Construction Plans to the AGENCY pursuant to Section 1.04 of this Part, PARTICIPANT shall submit to the AGENCY its plan for financing the construction of the Improvements (hereinafter "Construction Financing Plan"). The Construction Financing Plan shall include a cost breakdown by major cost category and a cash flow projection for the construction &the Improvements and the sources of necessary funds to pay, when due, the costs indicated in the cash flow projection and evidence that the funds necessary to finance those costs have been committed by PARTICIPANT, subject to such conditions as are commercially reasonable under the circumstances, including a firm commitment following completion of any hazardous materials remediation. Co) Sources of funds disclosed in the Construction Financing Plan may include additional equity investments and/or loans provided such funding is from reasonable financial or lending institutions, including pension funds and syndicating entities. A financial or lending institution shall be deemed reasonable if it is a bank, savings and loan institution, pension fund or insurance company licensed to do business in California, The AGENCY shall cooperate with PARTICIPANT in providing information to prospective lenders and equity investors. (0 Upon receipt by the AGENCY of the proposed Construction Financing Plan, the AGENCY shall promptly review same and shall approve it within fifteen (15) days after submission if it conforms to the provisions of this Part. The AGENCY shall act through its Executive Director. The AGENCY'S review of the Construction Financing Plan shall be limited to determining if the contemplated financing will reasonably be available and will provide sufficient funds for the purposes required as indicated in the Plan. If the Plan is not thereafter approved by the AGENCY, the AGENCY shall set forth in writing and notify PARTICIPANT of the reasons therefor. PARTICIPANT shall thereafter resubmit a revised Construction Financing Plan, as the case may be, to the AGENCY for its approval within thirty (30) days of Disposition and Development Page 3 of 21 Agreement (Giorgi) 0 0 0 the AGENCY'S notification of disapproval. The AGENCY will either approve or disapprove said revised plan within fit~een (15) days of resubmittal by PARTICIPANT. (d) Any material change, modification, revision or alteration of the approved Construction Financing Plan must be first submitted to and approved by the AGENCY for conformity to the provisions of this Agreement. If not so approved, the approved Construction Financing Plan shall continue to control. The AGENCY review of such material change, modification, revision or alteration of the approved Construction Financing Plan shall be limited to determining if the contemplated financing will reasonably be available and will provide sufficient funds for acquisition, or the purposes requked to be included in the Plan. For the purpose of this Section 1.05, a material change shall include, but is not limited to, a change in lender or equity provider, or a substantial increase or decrease in the amount of a loan or equity contribution. 1.06 City of South San Francisco Approval. At the time PARTICIPANT submits its Development Plan to the AGENCY, PARTICIPANT shall apply to the City of South San Francisco and, diligently pursue, and obtain all permits necessary for the construction of the Improvements. PARTICIPANT acknowledges that execution of this Agreement by the AGENCY does not constitute approval by the City of South Francisco, does not limit in any manner the discretion of the City of South San Francisco in the approval process, and does not relieve PARTICIPANT from the obligation to obtain all necessary permits, including building permits PARTICIPANT shall promptly pay when due all customary and reasonable fees and charges of the City of South San Francisco in connection with the processing and consideration of the City permits and approvals contemplated by this section. 1.07 Building Permit. At the time the PARTIcIPANT submits its Construction Plans it shall also apply for, diligently pursue and obtain issuance of a building permit from the City of South San Francisco allowing the construction of the Improvements called for in the Development Plan. 1.08 Billboard Removal PARTICIPANT shall remove and not reinstall the billboard currently installed on the western face of the PARTICIPANT's existing property at 212 Baden Avenue. Article Two: AGENCY PRE-DISPOSITION REQUIREMENTS 2.01 Exchange of Property The AGENCY shall exchange with PARTICIPANT real property and improvements ("Agency's" Property) commonly known as 205 Baden Avenue, South San Francisco, California, more fully described in the attached Exhibit A incorporated herein by reference;and, Disposition and Development Page 4 of 21 Agreement (Giorgi) 06;09/00 The CITY shall exchange with PARTICIPANT real property ("City' s "Property ) commonly known as 124 Linden Avenue, South San Francisco, California, more fully described in the attached Exhibit B incorporated herein by reference; and, The PARTICIPAlqT shall exchange with Agency real property and improvements ("Participant's" Property) commonly known as 212 Baden Avenue, South San Francisco, California, more fully described in the attached Exhibit C incorporated herein by reference; and, The AGENCY shall pay to PARTICIPANT the sum of THREE HUNDRED THREE THOUSAND DOLLARS ($303,000) said funds to be deposited into an escrow account and released at the time the exchange of parcels is consummated. All exchanges/conveyances identified herein shall be free and clear of any liens or encumbrances, other than utility easements. 2.02 Opening Escrow To accomplish the property exchange and transfer of the Property the PARTIES shall upon execution of this Agreement establish an escrow with Old Republic Title Company, 105 El Camino Real, San Bruno, California. The PARTIES shall execute and deliver all written instructions to the Escrow Agency to accomplish the terms hereof, so long as such interactions are consistent with this Agreement. Article Four: CONSTRUCTION OF IMPROVEMENTS 4.01 Construction Pursuant to Plans. Unless modified by operation of Section 4.02 of this Part, all works of construction and development on the Property shall be done in accordance with the Construction Plans approved pursuant to Section 1.04 above. 4.02 Change in Construction Plans. If the PARTICIPANT desires to make any material change in the Construction Plans, the PARTICIPANT shall submit the proposed change to the AGENCY for its approval which approval shall not be unreasonably withheld or delayed. If the Construction Plans, as modified by any proposed change, conform to the requirements of this Agreement, the AGENCY shall approve the change by notifying the PARTICIPANT in writing. Unless said proposed change is rejected by the AGENCY within fifteen (15) days, it shall be deemed approved. If rejected within such time period, the previously approved Construction Plans shall continue to remain in full force and effect. Any change in the Construction Plans required in order to comply with applicable codes shall be deemed approved, so long as such changes do not substantially nor materially change the Disposition and D~elopment Page 5 of 21 Agreement (Giorgi) 06/09/00 0 0 0 7 architecture, design, function, use, or other amenities of the Improvements as shown on the latest approved Construction Plans. 4.03 Construction Plans Must Be Approved. Notwithstanding any Other provision of this Part, the PARTICIPANT shall not commence any construction of the Improvements until it has first received the written approval by the AGENCY of the Construction Plans as provided in Section 1.04 and 4.02 of this Part. Any breach of this Section shall afford the AGENCY its rights under Section 7.04 of this Part. 4.04 Completion of the Improvements and Use of Property. The PARTICIPANT, for itself, its successors and assigns, hereby covenants and agrees diligently to perform in accordance with the following provisions ("Operating Covenants"): (a) To prosecute to completion the construction of the Improvements within twelve months following the date of commencement of construction of the Improvements; and (b) To open within thirty (30) days after the date specified in subparagraph (a) above, and continue to operate a retail furniture store consisting of 45,000 square feet for no less than seven (7) years from the date PARTICIPANT satisfies all the requirements for issuance of a Certificate of Completion for the Improvements; and 4.05 Progress Reports Until construction of the Improvements has been completed, PARTICIPANT authorizes the AGENCY to have full access to all building inspection reports and other information at the City of SOuth San Francisco to assist the AGENCY in reviewing the actual progress of construction. PARTICIPANT shall allow the AGENCY to review construction documents and records maintained by PARTICIPANT in the ordinary course of the construction as may be reasonably requested by the AGENCY. 4.06 Equal Opportunity. During the construction of the Improvements, PARTICIPANT shall not discriminate on the basis of race, religion, sex, or national origin in the hiring firing, promoting or demoting of any person engaged in the construction work and shall direct its contractors and subcontractors to refrain from discrimination on such basis. 4.07 Certificate of Completion for Improvements. Promptly after completion of construction of Improvements in accordance with the provisions of this Part and upon issuance ora certificate of occupancy by the CITY, the AGENCY will provide an instrument so certifying provided that, at the time such certification is issued, the Improvements have been completed (hereafter "Certificate of Completion"). Such Certificate of Completion shall be conclusive determination that the covenants in this Agreement Disposition and D~elopment Page 6 of 21 Agreement (Giorgi) 06/09/00 0 0 0 with respect to the obligations of PARTICIPANT, its successors and assigns, to construct the Improvements and the dates for the beginning and completion of construction thereof have been met. Such Certificate of Completion shall be in such form as will enable it to be recorded among the official records of San Mateo County. Such Certificate of Completion and determination shall not constitute evidence of compliance with or satisfaction of any obligation of Participant to any holder of a deed of trust securing money loaned to finance the Improvements or any part thereof and shall not be deemed a notice of completion under the California Civil Code. 4.08 Construction Bonds. Prior to the commencement of construction of the Improvements, the PARTICIPANT shall deliver to the AGENCY copies of any labor and material bonds, and performance bonds which may be required by PARTICIPANT'S lenders, which bonds shall be issued by a reputable insurance company licensed to do business in California. Such bonds shall name the AGENCY as co-obligee. 4.09 Implementation of Mitigation Measures. In carrying out the construction of the Improvements, it shall be the sole responsibility of the PARTICIPANT to implement all mitigation measures required by the AGENCY or the City of South San Francisco pursuant to the California Environmental Quality Act. Article Five: CHANGES IN PARTICIPANT 5.01 Identity &Participant The PARTICIPANT is a 5.02 Changes Only Pursuant To This Agreement. The qualifications, experience and expertise of PARTICIPAlqT is of particular concern to the AGENCY. It is because of these qualifications, experience and expertise that the AGENCY has entered into this Agreement. No voluntary or involuntary successor in interest to PARTICIPANT shall acquire any rights or powers under this Agreement, except as hereinat~er provided. 5.03 Prohibition Against Transfer of Property and Assignment &Agreement. Prior to the issuance by the AGENCY of a Certificate of Completion for the Improvements, the PARTICIPANT shall not voluntarily or involuntarily make or attempt any total or partial sale, transfer, conveyance, assignment or lease ("Transfer") of the whole or any part of the Property or the buildings or structures thereon or this Agreement without the prior written approval of the AGENCY, except for a transfer to a settlor or beneficiary of the PARTICIPANT, or to an entity principally controlled by the PARTICIPANT. The Agency's approval may be given by the Executive Director unless the Executive Director refers the matter Disposition and Development Page 7 of 21 Agreement (Giorgi) 06/09/00 ' 0 0 0 9 to the Agency Board. This prohibition shall not apply to any portion of the Property for which a Certificate of Completion has been issued. This prohibition shall not be deemed to prevent the granting of temporary easements or permits to facilitate development or the dedication of Property required pursuant to this Agreement. If the PARTICIPANT proposes a Transfer of the Property or a portion thereof, the proposed transferee shall have the qualifications and financial responsibility necessary and adequate as may be reasonably determined by the AGENCY to fulfill the obligations undertaken in this Agreement by the PARTICIPANT. Any transferee, by instrument in writing satisfactory to the AGENCY and in form recordable among the land records, for itself and its successors and assigns, and for the benefit of the AGENCY shall expressly assume all of the obligations of the PARTICIPANT under this Agreement relating to the Property and agree to be subject to all the conditions, covenants and restrictions to which the PARTICIPANT is subject to, including but not limited to the operating covenant of Section 4.04 of Part One. There shall be submitted to the AGENCY for review all instruments and other legal documents proposed to effect any such Transfer; and if approved by the AGENCY its approval shall be indicated to the PARTICIPANT in writing. In the absence of specific written agreement by the AGENCY, no Transfer by PARTICIPANT shall be deemed to relieve the PARTICIPANT or any successor in interest from any obligations under this Agreement. 5.04 Transferee Subject to All Conditions of Agreement. After filing the Certificate of Completion for a portion of the Property, no approval under this Agreement is needed for a Transfer of any portion of the Property. However, any transferee shall be subject to the all the conditions, covenants and restrictions of this Agreement. 5.05 Exception to Prohibition Against Transfer. PARTICIPANT may at any time, without limitation, and without the necessity of approval from the AGENCY, make a Transfer of the Property or any part thereof or any interest therein or any improvements thereon or of this Agreement, to: (i) a subsidiary, affiliate, parent or other entity which controls, is controlled by, or is under common control with PARTICIPANT; (ii) a successor corporation related to PARTICIPANT by merger, consolidation, non-bankruptcy reorganization, or government action; or (iii) a joint venture in which PARTICIPANT or any successor to PARTICIPANT under the preceding clauses (i) and (ii) is a partner. Disposition and Development Agreement (Giorgi) o6/o9/00 Page 8of21 00010 Article Six: DEFAULT 6.01 Scope of Remedies. During the development of the Improvements, and prior to the issuance of a Certificate of Completion for such Improvements hereof, the following shall govern the Parties' remedies for breach of the Agreement. 6.02 No Fault of Parties. The following events constitute a basis for a PARTY, otherwise allowed by this Agreement, to terminate this Agreement, without the fault of the other: (a) The PARTICIPANT, despite good faith efforts, is unable to obtain permits or approvals from the City of South San Francisco which are reasonably satisfactory for PARTICIPANT to construct the Improvements and operate its business on the Property; (b) The PARTICIPANT, despite good faith efforts on the part of both the AGENCY and PARTICIPANT, is unable to obtain approval of a Development Plan, reasonably satisfactory to PARTICIPANT, in the time provided in Section 1.03 of this Part; (c) The PARTICIPANT, despite good faith efforts on the part of both the AGENCY and PARTICIPANT, is unable to obtain approval of a Construction Plan, reasonably satisfactory to PARTICIPANT, in the time provided in Section 1.04 of this Part; or (d) Conditions imposed subsequent to execution of this Agreement by the CITY'S discretionary approvals makes development of the Property in the manner contemplated by this Agreement infeasible or materially more expensive for PARTICIPANT. (e) If the Property materially changes prior to close of escrow. Upon the happening of any of the above-described events, and at the election of either PARTY, this Agreement may be terminated by written notice to the other PARTY. Thereat~er, neither PARTY shall have any rights against or liability to the other, except as set forth in Article Six and Part Two. 6.03 Fault of Agency. Except as to events constituting a basis for termination under Section 6.02, the following events each constitute a basis for PARTICIPANT to take action against the AGENCY: (a) AGENCY without good cause fails to convey the Property within the manner and form herein called for and the PARTICIPANT is otherwise entitled by this Agreement to such action or conveyance; or Disposition and Development Agreement (Giorgi) 06109100 Page 9 of 21 00011 (b) The AGENCY breaches any other material provisions of this Agreement. Upon the happening of any of the above-described events, the PARTICIPANT shall first notify the AGENCY in writing of its purported breach or failure, giving the AGENCY ten (10) days from receipt of such notice to cure such breach or failure or if the nature of the breach or failure is such that it cannot reasonably be cured in ten (10) days, then giving the AGENCY such longer period as reasonably may be required for such cure provided that AGENCY commences action to cure the breach or default within said ten (10) day period and thereafter diligently pursues the cure to completion. In the event AGENCY does not then so cure or commence to cure within said ten (10) days, then the PARTICIPANT thereafter shall have the right to terminate this Agreement and any other rights afforded it by law or in equity. 6.04 Fault of Participant. Except as to events constituting a basis for termination under Section 7.02, the following events each constitute a basis for the AGENCY to exercise its rights pursuant to Section 8.01 of this Part, as applicable: (a) The PARTICIPANT does not meet its pre-disposition conditions within the relevant times set forth in Article One above; (b) The PARTICIPANT refuses to accept conveyance from the AGENCY of the Property within the time periods, and under such terms as herein called for; (c) The PARTICIPANT does not attempt in good faith to procure in a timely manner a building permit or other approvals for the Improvements or abandons any further attempts when there is a reasonable likelihood that such permit or other approvals would otherwise be issued by the proper authority in a timely manner and in substance satisfactory to PARTICIPANT in accordance with Section 4.08 above; (d) The PARTICIPANT constructs or attempts to construct the Improvements in material deviation fi-om the latest approved Construction Plans; (e) The PARTICIPANT fails to submit any plans or evidence required by Article One of this Part by the date specified in the relevant section; (f) Absent an Enforced Delay as defined in Section 5.04 of Part Two, the PARTICIPANT fails to commence construction of the Improvements or to complete same within the time limits set forth in this Agreement; (g) Absent an Enforced Delay as defined in Section 5.04 of Part Two, the PARTICIPANT abandons or suspends construction of the Improvements for a period of sixty (60) days after written notice by the AGENCY of such abandonment or suspension; Disposition and Development Agreement (Giorgi) 06/09/00 Page 10 of 21 00012 (h) Prior to PARTICIPANT"S satisfaction of the conditions for issuance of a Certificate of Completion, the PARTICIPANT voluntarily or involuntarily undertakes a Transfer not permitted by this Agreement; (i) PARTICIPANT fails to tender any amount it is required to pay pursuant to Section 3.03 of this Part; or Prior to PARTICIPANT'S satisfaction of the conditions for issuance of the Certificate of Completion, the PARTICIPANT breaches any other material provision of this Agreement; or, (k) PARTICIPANT without good cause fails to convey the Property within the manner and form herein called for and the AGENCY is otherwise entitled by this Agreement to such action or conveyance. Upon the happening of any of the above-described events, the AGENCY shall first notify the PARTICIPANT in writing of its purported breach, failure or act above-described, giving the PARTICIPANT ten (10) days from receipt of such notice to cure such breach, failure, or act or if the nature of the breach or failure is such that it cannot reasonably be cured in ten (10) days, then giving the PARTICIPANT such longer period as reasonably may be required for such cure or action provided that PARTICIPANT commences action to cure the breach or default within said ten (10) day period and thereafter diligently pursues the cure to completion. In the event PARTICIPANT does not then so cure within said ten (10) days, or in the event that PARTICIPANT does not commence curing a default which is not curable within said ten (10) days, the AGENCY thereafter shall be afforded the right to terminate this Agreement and any other rights afforded it by law or in equity. Article Seven: SPECIFIC REQUIREMENTs REGARDING REMEDIES 7.01 Construction Plans. If the Agreement is terminated pursuant to Section 6.04 of this Part, PARTICIPANT shall deliver to the Agency copies of any development or construction plans PARTICIPANT has had prepared for the Improvements on the Property. PARTICIPANT does not warrant or guarantee the correctness or usability of any plans delivered to the AGENCY. 7.02 Rights of Mortgagees. Any rights of the Agency under this Article Seven shall not defeat, limit or render invalid any lease, mortgage, deed of trust or any other'security interest permitted by this Agreement or any rights provided for in this Agreement for the protection of holder of security interests in the Property. Disposition and Development Agreement (Giorgi) 06/09/00 Page 11 of 21 00013 PART TWO: GENERAL PROVISIONS Article One: GENERAL KEQUIREMENTS AFTER CONSTRUCTION 1.01 Applicability. The PARTICIPANT, for itself, its successors and assigns agrees that upon the 'PARTICIPANT'S satisfaction of the conditions for issuance of the Certificate of Completion, the conditions set forth in this Article One shall apply for twenty (20) years, except the covenants against discrimination at Section 1.02 of this Pan shall be perpetual, and except the provisions of the Redevelopment Plan, which shall be in effect for the duration of the Redevelopment Plan. 1.02 Mandatory Language in All Subsequent Deeds. Leases and Contracts. All deeds, leases or contracts made or entered into by PARTICPANT, its successors or assigns, as to any portion of the Property shall contain therein the following language: (a) In Deeds: "Grantee herein covenants by and for itself, its successors and assigns, and all persons claiming under or through it, that there shall be no discrimination against or segregation of a person or of a group of persons on account of race, color, religion, creed, sex, marital status, ancestry, or national origin in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the property herein conveyed nor shall the grantee or any person claiming under or through the grantee 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 herein conveyed. The foregoing covenant shall mn with the land." (b) In Leases: "The lessee herein covenants by and for the lessee and lessee's heirs, personal representatives and assigns, and all persons claiming under the lessee or through the lessee, that this lease is made subject to the condition that there shall be no discrimination against or segregation of any person or of a group of persons on account of race, color, religion, creed, sex, marital status, ancestry, or national origin in the leasing, subleasing, transferring, use, occupancy, tenure or enjoyment of the land herein leased nor shall the lessee or any person claiming under or through the lessee 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, sublessees, subtenants, or vendees in the land herein leased." Disposition and Development Agreement (Giorgi) 06/09/00 Page 12 of 21 00014 (c) In Contracts: "There shall be no discrimination against or segregation of any person or group of persons on account of race, color, religion, creed, sex, marital status, ancestry or national origin in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the property nor shall the transferee or any person claiming under or through the transferee establish or permit any such practice or practices of discrimination or segregation with reference to selection, location, number, use or occupancy of tenants, lessee, subtenants, sublessees or vendees of the land." 1.03 Contents of Grant Deed. Any Grant Deed from the AGENCY shall contain the covenants set forth in Section 1.02 of this Part and such conditions of approval imposed by the CITY as are required to be contained in the Gram Deed. Article Two: SECURITY FINANCING AND RIGHTS OF HOLDERS 2.01 No Encumbrances Except for Development Purposes. Notwithstanding any other provision of this Agreement, mortgages and deeds of trust, or any other reasonable method of security (including assignment of leases or ground leases to a lender as security for a loan), are permitted to be placed upon the Property before the Certificate of Completion has been issued by the AGENCY, but only for the purpose of securing loans of funds to be used for financing the acquisition of the Property and/or the design, and construction of Improvements and any other expenditures reasonably necessary and appropriate to develop the Property under this Agreement. The PARTICIPANT shall promptly notify the AGENCY of any mortgage, deed of trust, sale and lease-back or other financing, conveyance, encumbrance or lien that has been or will be Created or attached to the Property. The words "mortgage" and "deed of trust" as used herein include all other appropriate modes of financing acquisition, construction, and development of the Property or any portion thereof. 2.02 Holder Not Obligated to Construct. The holder of any mortgage, deed of trust or other security interest authorized by this Agreement is not obligated to construct or complete any improvement or to guarantee such construction or completion; nor shall any covenant or any other provision in conveyances from the AGENCY to PARTICIPANT evidencing the realty comprising the Property or any part thereof be construed so to obligate such holder. Nothing in this Agreement shall be deemed to permit or authorize any such holder to devote the Property or any portion thereof to any uses, or to construct any improvements thereon, other than those uses or improvements provided for or authorized by this Agreement. Disposition and Development Agreement (Giorgi) 06/09/00 Page 13 of 21 00015 2.03 Notice of Default and Right to Cure. Whenever the AGENCY pursuant to its rights set forth in this Agreement delivers any notice or demand to the PARTICIPANT with respect to the commencement, completion, or cessation in the construction of the Improvements the AGENCY shall at the same time deliver to each holder of record of any mortgage, deed of trust or other security interest authorized by this Agreement a copy of such notice or demand. Each such holder shall (insofar as the rights of the AGENCY are concerned) have the right, but not the obligation, at its option, within ninety (90) days after the receipt of the notice, to cure or remedy or commence to cure or remedy any such default or breach and to add the cost thereof to the security interest debt and the lien on its security interest. Nothing contained in this Agreement shall be deemed to permit or authorize such holder to undertake or continue the constmction or completion of the Improvements (beyond the extent necessary to conserve or protect such improvements or construction already made) without first having expressly assumed in writing the PARTICIPANT'S obligations to the AGENCY relating specifically to such Improvements under this Agreement. The holder in that event must agree to complete, in the manner provided in this Agreement, the Improvements and submit evidence reasonably satisfactory to the AGENCY that it has the developmental capability on statfor retainer and financial capacity necessary to perform such obligations. Any such holder properly completing such Improvements pursuant to this paragraph shall assume all rights and obligations of PARTICIPANT under this Agreement and shall be entitled, upon written request made to the AGENCY, to a Certificate of Completion from the AGENCY. 2.04 Failure of Holder to Complete Improvements. In any case where, six (6) months after default by the PARTICIPANT in completion of construction of the Improvements under this Agreement, the holder of record of any mortgage, deed of trust or other security interest creating a lien or encumbrance upon the Property, having first exercised its option to construct, has not proceeded diligently with construction, the AGENCY shall be afforded those rights against such holder which it would otherwise have against PARTICIPANT under this Agreement. 2.05 Right of Agency to Cure. In the event of a default or breach by the PARTICIPANT of a mortgage, deed of trust or other security instrument prior to issuance of a Certificate of Completion for all of the Improvements, and the holder has not, within sixty (60) days after receiving notice of said default or breach, exercised its option to complete the Improvements, the AGENCY may terminate the Agreement. 2.06 Holder to be Notified. The PARTICIPANT, for itself, its successors and assigns hereby warrants and agrees that each term contained herein dealing with security financing and rights of holders shall be either inserted into the relevant deed of trust or mortgage or acknowledged by the holder prior to its coming into any security right or interest in the Property. Disposition and Development Agreement (Giorgi) 06/09/00 a e 4or21 O001a 2.07 Modifications to Agreement. The AGENCY shall not unreasonably withhold its consent to modifications of this Agreement requested by PARTICIPANT'S lender or lenders provided such modifications do not alter the AGENCY'S substantive rights and obligations under this Agreement. Article Three: GENERAL PROVISIONS 3.01 Notices. Demands and Communications. Formal notices, demands, and communications between the AGENCY and the PARTICIPANT shall be sufficiently given if and shall not be deemed given unless dispatched by registered or certified mail, postage prepaid, return receipt requested or delivered personally, to the principal office of the AGENCY and the PARTICIPANT as follows: Agency: South San Francisco Redevelopment Agency 400 Grand Avenue South San Francisco, California 94083 Attn: Michael A. Wilson, Executive Director CC; Meyers, Nave, Riback, Silver & Wilson 777 Davis Street, Suite 300 San Leandro, CA 94577 Attn: Steve Mattas, Agency Counsel PARTICIPANT:: Robert & Kathleen Giorgi 1015 Drake Court San Carlos, CA 94070 Such written notices, demands and communications may be sent in the same manner to such other addresses as the affected PARTY may from time to time designate by mail as provided in this Section 3.01. The failure of either PARTY to send a courtesy copy notice to the other paxty's counsel noted above shall not invalidate any notice sent by such PARTY. 3.02 Conflict of Interests. No member, official or employee of the AGENCY shall make any decision relating to the Agreement which affects his or her personal interests or the interests of any corporation, partnership or association in which he or she is directly or indirectly interested. Disposition and Development Agreement (Giorgi) 06/09/00 Page 15 of 21 00017 3.03 Non-Liability of Agency Officials, Employees and Agents. No member, official, employee or agent of the AGENCY or CITY shall be personally liable to the PARTICIPANT, or any suexessor in interest, in the event of any default or breach by the AGENCY or for any amount which may become due to the PARTICIPANT or successor or on any obligation under the terms of this Agreement. 3.04 Enforced Delay. In addition to specific provisions of this Agreement, performance by either PARTY hereunder shall not be deemed to be in default where delays or defaults are due to war; insurrection; strikes; lock-outs; dots; floods; earthquakes; fires; casualties; acts of God; acts of the public enemy; epidemics; quarantine restrictions; fi'eight embargoes; lack of transportation; governmental restrictions (excluding those imposed by the AGENCY or the CITY) or priority; litigation (including suits filed by third parties concerning or arising out of this Agreement or suits challenging approvals of this Project by the City of South San Francisco); weather or soils conditions which will necessitate delays; inability to secure necessary labor, materials or tools; delays of any contractor, sub-contractor or supplier; acts of the other PARTY; acts or failure to act of any public or governmental agency or entity (other than the acts or failure to act of the AGENCY); or any other causes beyond the control or without the fault of the PARTY claiming an extension of time to perform. The PARTY claiming such extension shall send written notice of the extension to the other within thirty (30) days from the commencement of the cause. Times of performance under this Agreement may also be extended in writing by the AGENCY and the PARTICIPANT by mutual agreement of PARTICIPANT and the Executive Director unless the Executive Director, in his discretion, refers the matter of extension to the Agency Board. 3.05 Inspection of Books and Records. The AGENCY has the right at all reasonable times to inspect on a confidential basis the books, records and all other documentation of the Developer pertaining to its obligations under this Agreement. Said rights of inspection shall terminate upon the issuance of the Certificate of Completion with respect to the AGENCY'S inspection of PARTICIPANT'S books and records. 3.06 Provision Not Merged With Deeds. None of the provisions of this Agreement are intended to or shall be merged by any Grant Deed transferring title to any real property the subject of this Agreement from AGENCY to PARTICIPANT or any successor in interest, and any such Grant Deed shall not be deemed to affect or impair the provisions and covenants of this Agreement. 3.07 Indemnity by Developer. Disposition and Development Page 16 of 21 Agr~m~nt (Giorgi) 06/09/00 00018 (a) Except as provided in Section 3.07(c) of this Part, PARTICIPANT shall Defend (with attorneys selected by the Agency), indemnify, and hold harmless the AGENCY for any claim against the Agency of any nature whatsoever arising out of or in connection with PARTICIPANTS purported acts or omissions on or about, or PARTICIPANT'S occupancy or use of, the Property or PARTICIPANT'S performance or non-performance under or with respect to this Agreement, and any claims for relocation related to the Property, except to the extent any .... such claim arises out of or in connection with the AGENCY'S purported acts or omissions on, about, or with respect to the Property or the AGENCY'S performance or non-performance under, or with respect, to this Agreement. If'any such claim is attributable to an action or omission of PARTICIPANT'S construction contractor, such contractor shall also defend, indemnify and hold harmless the AGENCY against such claim arising out of or in connection with PARTICIPANT'S construction contractor's purported acts or omissions on or about, or PARTICIPANT'S construction contractor's occupancy or use of, the Property or PARTICIPANT'S construction contractor's performance or non-performance under or with respect to this Agreement, except to the extent any such claim arises out of or in connection with the Agency's purported acts or omissions on, about or with respect to the Property or the Agency's performance or non-performance under or with respect to this Agreement. Co) Upon knowledge of any such claim, the AGENCY shall notify the PARTICIPANT and its construction contractor of such claim in writing. Upon receipt of such written notice, PARTICIPANT, and, if applicable, its construction contractor, shall defend at their own expense any suit based on such claim. Such defense shall include provision of separate and independent counsel for the AGENCY where such counsel is required by the California Code of Professional Conduct, or by common law conflict of interest principles. The Agency shall have the right to choose such independent counsel. If any judgment or claims against the AGENCY shall be allowed, the PARTICIPANT and, if applicable, its construction contractor, shall pay or satisfy such judgment or claim and pay all costs and expenses in connection therewith. (c) The obligations to defend, indemnify and hold harmless the AGENCY, specified in Sections 3.07(a) and Co) above, shall not apply to any claim against the AGENCY arising from damage caused by the AGENCY'S act or omission or the tortious conduct of the AGENCY. This section does not modify PARTICIPANT' s obligation to reimburse the CITY for its costs of defense against any challenge to issuance of the Conditional Use Permit as set forth in CITY's development application. (d) PARTICIPANT, the AGENCY, and PARTICIPANT'S construction contractor Shall have an affirmative duty to cooperate with one another in the conduct of any suit arising from this Agreement or from development of the Property pursuant to this Agreement; provided, however, that such duty to cooperate shall be limited by any conflict of interest which arises during the course of any such suit. Disposition and Development Agreement (Giorgi) 06/O9/O0 Page 17 of 21 00019 3.08 Liability Insurance. (a) PARTICIPANT shall maintain in force during the construction of the Improvements pursuant to this Agreement public liability and property damage insurance, including personal injury, contractual, and owned and non-owned automobiles, with such coverage and limits as may be reasonably requested by AGENCY from time to time, but in no event for less than the sum of one million dollars ($1,000,000) combined single limit. (b) Public liability insurance policy or policies shall name AGENCY and CITY as an additional insured, and any policy or policies shall contain cross-liability endorsements. An endorsement shall be provided which states the coverage is primary insurance and that no other insurance held by AGENCY or CITY will be called upon to contribute to a loss under this coverage. (c) A certificate evidencing such insurance coverage or coverages shall be filed with AGENCY and CITY prior to the commencement of the term of this Agreement, and said certificate shall provide that such insurance coverage will not be canceled or reduced without at least thirty 00) days' prior written notice to AGENCY and CITY. (d) If such coverage is canceled or reduced, PARTICIPANT shall, within fifteen (15) days at~er receipt of written notice from AGENCY or CITY of such cancellation or reduction in coverage, but in no event later than the effective date of cancellation or reduction, file with AGENCY and CITY a certificate showing that the required insurance has been reinstated or provided through another insurance company or companies: Upon failure to so file such certificate, AGENCY or CITY may, without further notice and at its option, procure such insurance coverage at PARTICIPANT'S expense, and PARTICIPANT shall promptly reimburse AGENCY for such expense upon receipt of billing from AGENCY or CITY. 3.09 Rights and Remedies Cumulative. Except as otherwise expressly stated in this Agreement, the rights and remedies are cumulative, and the exercise or failure to exercise one or more of such rights or remedies by either PARTY shall not preclude the exercise by it, at the same time or different times, of any right or remedy for the same default or any other default. 3.10 Real Estate Commissions. Neither PARTY shall be responsible to the other for any real estate commissions or brokerage fees, which may arise from this Agreement or otherwise be incurred by the other PARTY. 3.11 Reasonable Approvals. Unless the context indicates otherwise, where an action under this Agreement requires approval of a PARTY, such approval shall not be unreasonably withheld. Disposition and Development Agreement (Giorgi) 06/09/00 Page 18 of 21 00020 · 3.12 Applicable Law. This Agreement shall be interpreted under and pursuant to the laws of the State of California. 3.13 Severability. If any term, provision, covenant or condition of this Agreement is held by a court of competent jurisdiction to be invalid, void or unenforceable, the remainder of the provisions shall continue in full force and effect unless the rights and obligations of the PARTIES have been materially altered or abridged by such invalidation, voiding or unenforceability. 3.14 Legal Actions. In the event any legal action is commenced to interpret or to enforce the terms of this Agreement or to collect damages as a result of any breach thereof, the PARTY prevailing in any such action shall be entitled to recover against the PARTY not prevailing all reasonable attorneys' fees and costs incurred in such action. 3.15 Binding Effect. This Agreement shall be binding upon and inure to the benefit of the heirs, administrators, executors, successors in interest and assigns of each of the PARTIES hereto except that there shall be no transfer of any interest by any of the PARTIES hereto except pursuant to the terms of this Agreement. Any reference in this Agreement to a specifically named PARTY shall be deemed to apply to any successor, heir, administrator, executor or assign of such PARTY who has acquired an interest in compliance with the terms of this Agreement, or under law. 3.16 Parties Not Co-Venturers. ' Nothing in this Agreement is intended to or does establish the PARTIES as partners, co- venturers, or principal and agent with one another. 3.17 Warranties. The AGENCY expresses no warranty or representation to the PARTICIPANT as to fitness or condition of the Property which is the subject of this Agreement for the building or construction to be conducted thereon, except as follows: AGENCY has made no untrue statements or representations in connection with this Agreement, and all items transferred to PARTICIPANT on or before Closing shall have been and be true, correct and complete copies of what they purport to be. AGENCY has not failed to state or disclose any material fact in connection with the transaction contemplated by this Agreement. AGENCY knows of no facts, nor has AGENCY failed to disclose any fact, which would prevent PARTICIPANT from using and operating the Property after Closing in the manner in which it is intended to be operated by PARTICIPANT. Disposition and Development Agreement (Giorgi) 06/09/00 Page 19 of 21 00021 3.18 Time is of the Essence. In all matters under this Agreement, the PARTIES agree that time is of the essence. 3.19 Complete Understanding of the Parties. This Agreement consists of the text of the Agreement and the attached Exhibits and ~-'~constitutes the entire understanding and ag_r_e~em_ent of the PARTIES. 3.20 Good Faith, The PARTIES recognize that it is impractical in this Agreement to provide for every contingency which may arise during the life of the Agreement, and the PARTIES hereby agree that it is their intention that this Agreement shall operate fairly between them and without detriment to the interests of either of them, and that, if during the term of this Agreement either PARTY believes that this Agreement is operating unfairly, the PARTIES will use their best efforts to agree on such action as may be necessary to remove the cause or causes of such unfairness. 3.21 Prevailing Wage. PARTICIPANT and its COntractors shall comply with the Agency's Prevailing Wage policy adopted pursuant to Agency Resolution No. 15-97. WHEREFORE, the Parties have executed this Agreement in triplicate on or as of the date first above written. REDEVFJ,OPMENT AGENCY OF THE CITY OF South San Francisco By: MICHAEL A. WILSON Executive Director APPROVED AS TO FORM: By: Agency CoUnsel Disposition and Developmeal Agreement (Giorgi) 06/09/00 Page 20 of 21 00022 ATTEST: By: Agency Secretary Dated Approved By: By: Kathleen Giorgi Robert Giorgi Attorney for Kathleen and Robert Giorgi Disposition and Development Agreement (Giorgi) 06/09/00 Page 21 of 21 00023 EXHIBIT LEGAL DESCRIPTION OF AGENCY'S PROPERTY APN 012-335-090 Lot 25 in Block 141, as shown on that certain map entitled "SOUTH SAN FRANCISCO PLAT NO. 1" filed in the office of the County Recorder of San Mateo County, State of California, on March 1, 1892 in Book w of Maps at page 52. 00024 LEGAL DESCRIPTION OF CITY'S PROPERTY APN 012-335-620 ~ Lots 14,15,16 and 17, Block 141, as shown on that certain map entitled "SOUTH SAN FRANCISCO, SAN MATEO COUNTY, CALIFORNIA, PLAT NO. 1", filed in the office of the County Recorder of San Mateo County, State of California, in Book "B" of Maps at page(s) 6, and copy entered in Book 2 of Maps at page 52. EXCEPTING THEREFROM, the Southeasterly 13.00 feet of said Lot 17. EXCEPTING for street and street improvemem purposes a portion of said Lots 14 and 15, more particularly described as follows: BEGINNING at the Southwesterly comer of said Lot 14; thence Northerly along the Northwesterly line of said Lot, North 15°31'2T' East (North 15o33'00" West), a distance of 119.91 feet (120.00 feet) to a point of curvature; thence along a tangent curve to the right having a radius of 20.00 feet, through a central angle of 90o01'33" (90°00'00"), an arc distance of 31.42 feet to a point on the Northeasterly line of said LOt 14; thence continuing along said Northeasterly line of said Lots 14 and 15, South 74°2T'00'' East, a distance of 27.02 feet to a point of curvature; thence along a tangent curve to the let~ having a radius of 35.00 feet, through a central angle ofg0© 01' 33" (90° 00' 00"), an arc distance of 54.99 feet to a point on a line parallel with and distant perpendicularly 13,00 feet Northwesterly fxom the Southeasterly line of said Lot 14; thence South 15° 31'27" West (South 15°33' 00"West), a distance of 104.98 feet to the Southwesterly line of said Lot 14; thence along said Southwesterly line, North 74° 27'00" West, 12.00 feet to the point of beginning. 00025 EXHIBIT LEGAL ~DESCRIPTtON OF PARTICIPANT'S PROPERTY APN 012-334-040 Lots 6 and 7 in Block 140, as shown on that ~e. rtain map. entitled "SOUTH SAN FRANCISCO, SAN MATI~O COUNTY, State of California, on March 1, 1892 in_Book "B" of Maps at pages(s) 6 and a copy entered inBook 2 of Maps at page 52. 00026