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HomeMy WebLinkAboutReso 37-2019 (19-163)If"Tll IMm-nber 19-163 Enactment Number: RIES 37-2019 RESOLLY1710N APPROVING TFIE', PURCHASE AND SALE,' AGREEMENT .13E'FWI-.,,EN JITE CITY OF SOUTH SAN FRANCISCOAND 938 LINDEN,1-T, FOR17HE SALE OF 938 LINDEN "EINUE, INTIJE AMOUNTOF'$1,050,000. WHERIE AS, on June 29, 2011, the Legislature of the State of California ("'State") adopted Assembly Bill x1 26 ("AB 26"), which amiended provisions of the State's Community Redevelopment Law (14ealth and Safbtyy Code sections 33000 et seq.) ("Dissolution Law"), pursuatit to which the former Redevelopment .Agency of the City of South San Francisco ("City") was dissolved on February 1, 2012; arid. Id s.. the City elected to become the Successor Agency to the.lZedevelopment.A.gency of the City of South San Francisco ("Successor Agency"); arid WHEREAS, pursuant to Health and Safety Code Section 34191.6(c)(2)(C), property shall not be transferred to a successor agency, city, county or city and county, unless an Long Range Property Management Plan ("LRP.MP") has been approved by the Oversight Board and the California Department of Finance ("DOF"); md W1-1ER.l'!.AS,, in accordance with die Dissolution Law, the Successor Agency prepared a I...RPMP, which was approved by a resolution. of the Oversight Board for the Successor Agency to theRedevelopment Agency of the City of South San Francisco ("Oversight.Board") onMay 21, 2015, and was approved by th.e.13017 on October 1, 2015; arid WHEREAS, consistent with theDissolution Law and the LRPMP, certain real properties located in the City of South Sam Francisco, that were previously owned by the fornier Redeve.lopment Agency, were transferred to the Successor Ageu.(..,sy ("Agency Properties"); and WHEREAS,, on October 18, 2016, the City entered into an Amended andRestated MasterAgee ernent for TaxingEntity Compensation ("Compensation Agreement") with the various local agencies who receive shares of Property tax revenues from the former redeveloptnent project area ("Thxing.En ti ties"'), which provides that UPOD approval by the Oversight Board of the sale price, ai.-id. consistent with the LRPMP, the proceeds ftom the sale of any of the Agency Properties will Inc distributed to the ThxiDg Entities hi accordance with. their propoinionate contributions to the Real PropertyTax 'frust Fund for the fimvier Redevelopment Agency; and Wt.]EREAS, th.e.former Redevelopment Agency purchased the Property in 2009; and, City of South San Francisco Page 1 File Number, 1,9463 Enactment Number RES 37-2019 WBEREAS, the LWIMP, prepared by the Successor Agency and. approved by the Oversight Board l'or the Successor Agency to the Redevelopment Agency of the City of South San Francisco ("Oversight Board"'), designated 938 Linden Avenue, County Assessor's Parcel Nuiriber 012-102-030 ("Property"), to be sold, with die proceeds of the sale distributed to the taxing enlities; and, WHEREAS, to carry out die ternis of the UUMP, the Successor Agency transferred the Agency Properties, including the Property, to the City for disposition consistent, with the ternis of the LR..PMP; arid, WHEREAS, in October 2017, the City of South San Francisco solicited ofl"ers to interested parties to the Property; and, WIDE EAS, Robert 938 Linden, LY ("Buyer") has made an offer to purchase the Property, and the City agrees to sell the Property to Buyer, subject to the ternis and conditions of the purchase and sale agreement; and, WHEREAS, inJannary 2018, the Successor Agency prepared an. Appraisal Report to deteimine the Fair Market Value for the Property; arid, WHEREAS, s-taff has determined that the current appraised valtw, of the property is consistent with the original Appraisal Report, dated npanuary 2018. OW, TIJEREFORE, BE ITRESOLVED that the City of South San Francisco does hereby resolve as follows: 1. The 1,bregoing recitals are true tind correct and made a. pa rt. of this Resolution. 2. The proposed actions in this Resolution are consistent with the Long Range property Managernerit Plan. 3. The sale of the Propertyduo 938 Linden, I,Pfor$1,050,000 is hereby approved. 4. Subject. to approva l. by the Oversight Board of the final sale price, the City Manager, or his designee, is authorized to execute the Purchase and Sale Agreernerat on behalf of the City, a draft of which is aftached hereto as Exhibit A and incorporated herein., subject to ininor aniendiinents that do not rnaterially increase the City's obligafiions. 5, 17he City Manager, or his designee, is authorized to execute any otber necessaiy documents related to the sale of the Property. 6. The City Managei, or his designee, is authorized take any and all. other actions necessary to implement this intent of this Resolution, subject to approval as to foriar by the City Attorney. CiW of South San Francisco Page 2 File Number: 19-163 Enactment Number: RES 37-2019 At a meeting of the City Council on 3/13/2019, a motion was made by Richard Garbarino, seconded by Buenaflor Nicolas, that this Resolution be approved. The motion passed. Yes: 5 Mayor Matsumoto, Vice Mayor Garbarino, Councilmember Addiego, Councilmember Nagales, and Councilmember Nicolas Attest by /osa Govea Acosta City of South San Francisco Page 3 PURCHASE AND SALE AGREEMENT AND JOINTESCROW INSTRUCTIONS THIS PURCHASE AND SALE AGREEMENT AND JOINT ESCROW rNSTRUCTIONS ("this Agreement") is entered into as of 2019 (the "Effective .Date"), by and between the City of South San Francisco, a municipal corporation, ("Seller") and 938 Linden, LP, a California limited partnership ("Buyer"). Seller and Buyer are collectively referred to herein as the "Parties." A. Seller is owner of certain real property with an address of 938 Linden Avenue, South San Francisco, California, also known as San Mateo Assessor's Parcel Number 012-102-030, as more particularly described in Exhibit A attached hereto and incorporated herein (the WI`ropertyq4)., B. The for merRedevelop mentAgency of the City of South San Francisco ("RDA.") purchased the Property in 2009. C. On, June 29, 2011 the legislature of the State of California (the "State") adopted Assembly Bill x 1 26 ("AB 26"), which amended provisions of the Redevelopment Law, and the California Supreme Court, decision in Califiarnia Redevelopment Association, et al. v. Ana Matosantos, et al., upheld AB 26 (together with AB 1484, the "Dissolution Law"), and the RDA was dissolved on February 1, 2012. D. 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 ofSouth San Francisco ("Oversight Board") on November 19, 2013, and on May 21, 2015" the Oversight Board approved the Amended Long Range Property Management Plan ("LRPMP"'), which was approved by the California department of Finance ("DOV) on October 1, 2015. E. Pursuant to the LRPMP arid. Dissolution Law, the Agency's transfer of real property assets to the City for disposition consistent with the LRPMP is subject to entering into a Master Agreement for Taxing Entity Compensation by all Taxing Entities. F. The City and Taxing Entities entered into an Amended and Restated Master Agreement for Taxing Entity Compensation, dated October 18, 2016 ("Master Compensation Agreement"'), which governs the distribution of any net proceeds received from the sale of the Property. G. Buyer agrees to purchase the Property, and Seller agrees to sell the Property to Buyer, subject to the terms and conditions of this Agreement. 219\3220028.3 NOW, THEREFORE, for and in consideration of the mutual covenants and agreements contained in this Agreement, and other good and valuable consideration, the receipt and adequacy of which is hereby acknowledged by the parties, Seller and Buyer hereby agree as follows: 1. INCORPORATION OF RECITALS AND EXHIBITS. The Recitals set forth above and the Exhibits attached to this Agreement are each incorporated into the body of this Agreement as if set forth in full. 2. PURCHASE AND SALE. 2.1 Agreement to Bound Sell. Subject to the terms and conditions set forth herein, Seller agrees to sell the Property to Buyer, and Buyer hereby agrees to acquire the Property from Seller. 2.2 Purchase Price. The purchase price for the Property to be paid by Buyer to Seller (the "Purchase Price") is one million and fifty thousand dollars ($1,050,000.00). The Purchase Price shall be paid in cash at the Closing to the Seller. 3. ESCROW. 3.1 Escrow Account. Seller has opened an interest-bearing escrow account (the "Escrow") maintained by North American Title Company in San Mateo (the "Escrow Holder"), with interest accruing to the benefit of Buyer. Escrow Holder shall perform all escrow and title services in connection with this Agreement. 3.2 Opening of Escrow. Within seven (7) business days after the Effective Date, the Parties will deposit into Escrow the fully executed Agreement, or executed counterparts thereto. The date such fully executed Agreement is received by Escrow Holder will be deemed the "Opening of Escrow" and Escrow Holder will give written notice to the Parties of such occurrence. 3.3 Buver's Deposit. Within three (3) business days after the Opening of Escrow, the Buyer shall deposit fifty thousand dollars ($50,000.00) in Escrow ("Initial Deposit"). If the Due Diligence Contingency Period (as defined in Section 5.2(a) below) is extended pursuant to Section 5.2, Buyer shall deposit an additional fifty thousand ($50,000.00) in Escrow (the "Additional Deposit"). The Initial Deposit and Additional Deposit are sometimes collectively referred to herein as the "Deposits." 3.4 Satisfaction of Due Dili zence Contingency. Buyer shall have the right, in its sole discretion, to terminate this Agreement for any reason prior to the expiration of the Due Diligence Contingency Period (as defined in Section 5 below) and receive a refund of the Deposit. Buyer hereby agrees to provide written notice to Seller prior to the expiration of the Due Diligence Contingency Period if Buyer disapproves any due diligence items or approves all due diligence items ("Approval Notice"). If Buyer disapproves any items through the delivery of the Approval Notice to Seller before 5:00 p.m. on the last day of the Due Diligence Contingency Period, this Agreement shall terminate, and all amounts deposited by Buyer into escrow (except the Independent Consideration), together with interest thereon, if any, will be returned to Buyer, and neither party shall have any further rights or obligations hereunder except those which -2- 219\3220028.3 expressly survive the termination hereof If Buyer fails to timely deliver the Approval Notice to Seller, it will be conclusively presumed that Buyer has approved all such items, matters or documents. 3.5 Independent Consideration. As independent consideration for Seller's entering into this Agreement to sell the Property to Buyer, Buyer shall deliver the sum of Five Thousand Dollars ($5,000.00) to Seller through Escrow (".Independent Consideration"). In the event that Buyer terminates this Agreement in accordance with Section 3.4. above, Seller shall retain the Independent Consideration; in the event that Buyer does not terminate this Agreement as aforesaid, the Independent Consideration shall be applied to the Purchase Price at Closing. 4. PROPER' Y DISCLOSLRf , r RL-QUIREME-XrS. 4.1 Condition of itle/Prelimjnga`Title Bcport. Escrow Holder shall deliver a Preliminary 'Title Report for the Property (the "Preliminary Report") to Buyer within three (3) days after the Opening of Escrow. Buyer shall have until the end of the Due Diligence Contingency Period. to approve the condition of title to the Property. If Buyer delivers the Approval Notice, Buyer agrees to take title to the Property subject to the following "Permitted Exceptions"., (a) standard printed exceptions in the Preliminary Report; (b) general and special real property taxes and assessments constituting a lien not yet due and payable; and (c) the Schedule B exceptions to the title referenced in the Approval Notice. 4.2 Environmental Condition of �Pro e�rt. Seller has provided Buyer with all documents reasonably known to Seller pertaining to the environmental condition of the Property, including the report, "Summary of Known Environmental Conditions 938 Linden Avenue, South Sari Francisco, California (EI I B70049.00)" (hereafter referred to as "EKI report"). At Closing, the Buyer agrees to take title of the Property in AS- IS WHERE -IS condition with no environmental remediation work required by or indemnities from the Seller or the Agency, Seller, at Buyer's expense, agrees to cooperate with Buyer to obtain regulatory approval of any necessary environmental work for the Property. Buyer explicitly acknowledges that Buyer will be responsible to manage and complete any remediation work for the Property after Closing. After Closing, Seller shall have no further obligations with respect to environmental and/or natural hazards remediation costs. 4.3 Environmental and Natural Hazards Disclosure. California I-lealth & Safety Code section 25359.7 requires owners of non-residential real property who know, or have reasonable cause to believe, that any release of hazardous substances are located on or beneath the real property to provide written notice of same to the buyer of real property. Other applicable laws require Seller to provide certain disclosures regarding natural hazards affecting the Property. Pursuant to Section 4.2, Seller has provided Buyer with the EKI report and agrees to make any additional necessary disclosures required by law. 5. CLOSING AND PAYMENTCSF PURCHASE PRICE. -3- 2 1 91322002 8.3 3-219\32200283 5.1 QIosin y. The closing (the "Closing" or "Close of Escrow") will occur no later than thirty (30) calendar days after the Effective Date ("Closing Date") or such other date that the Parties agree in writing. 5.2 Buyer's obligation to purchase the Property is subject to the satisfaction of all of the following conditions or Buyer's written waiver thereof (in Buyer's sole discretion) on or before the Closing Date: (a) Buyer has approved the condition of the Property. Buyer will have ten (1 0) calendar days from Opening of Escrow (the "Due Diligence Contingency Period") to complete physical inspections of the Property and due diligence related to the purchase of the Property. Seller shall provide to Buyer copies of all reasonably available and known documents relating to the ownership and operation of the Property, including but not limited to plans, permits and reports (environmental, structural, mechanical, engineering and land surveys) that Seller has in its possession not later than two (2) business days following the execution and delivery of this Agreement, or as soon as practicable thereafter. All physical inspections must be coordinated with Seller's representative. Buyer hereby agrees to indemnify and hold Seller harmless for any damage to the Property caused (but not merely revealed) by Buyer's inspections. (b) Seller has performed all obligations to be performed by Seller pursuant to this Agreement. (c) Seller's representations and warranties herein are true and correct in all material respects as of the Closing Date.. (d) T'he Title Company is irrevocably committed to issue an ALTA standard coverage title insurance policy to Buyer, effective as of the Closing Date, insuring title to Buyer in the full amount of the Purchase Price. 5.3 Seller's Conditions to CloAn&,,. The Close of Escrow and Sellers obligation to sell and convey the Property to Buyer are subject to the satisfaction of the following conditions or Seller's written waiver (in Seller's sole discretion) of such conditions on or before the Closing Date: (a) Buyer has performed all obligations to be performed by Buyer pursuant to this Agreement before Closing Date. (b) Buyer's representations and warranties set forth herein are true and correct in all material respects as of the Closing Date. 5.4 C �,onve ��tnceof�Fitle. Seller will deliver marketable fee simple title to Buyer at the Closing, subject only to the Permitted Exceptions. The Property will be conveyed by Seller to Buyer in an "as is" condition, with no warranty, express orimplied, by Seller as to the physical condition including, but not limited to, the soil, its geology, or the presence of known or unknown faults or Hazardous Materials or hazardous waste (as defined by Section 12); provided, however, 219\3220028.3 that the fbregoing shall not relieve Seller from disclosure of any such conditions of which Seller has actual knowledge. 5.5 Deliveries 41L josigg. (a) Deliveries by_Seller. Seller shall deposit into the Escrow for delivery to Buyer at Closing: (i) a grant deed, substantially in the form attached hereto as.Exhibit .11 ("Grant Deed"); (ii) an affidavit or qualifying statement which satisfies the requirements of paragraph 1445 of the Internal Revenue Code of 1986, as annended, any regulations thereunder (the "Non -Foreign Affidavit"); (iii) a California Franchise Tax Board form 590 (the "California Certificate") to satisfy the requirements of Califomia Revenue and Taxation Code Section 18805(b) and 261.31. (b) Deliveries by Buyer. No less than one (1) business day prior to the close of escrow, Buyer shall deposit into escrow immediately available funds in the amount, which together with the Independent Consideration and the Deposits is equal to: (i) the Purchase Price as adjusted by any prorations between the Parties; (ii) the escrow fees and recording fees; and (iii) the cost of th.e'ritle Policy. (c) !Closing. Upon Closing, Escrow Holder shall: (i) record the Grant Deed.; (ii) disburse to Seller the Purchase Price, less Seller's share of any escrow fees, costs and expenses; (iii) deliver to Buyer the Non -Foreign Affidavit, the California Certificate and the original recorded Grant Deed; (iv) pay any commissions and other expenses payable through escrow; and (vi) distribute to itself the payment of escrow fees and expenses required hereunder. (d) Closing Costs. Buyer will pay all escrow fees (including the costs of preparing documents and instruments), and recording fees. Buyer will also pay title insurance and title report costs. Seller will pay all transfer taxes and governmental conveyance fees, Where applicable. (e) Pro -Rations. At the close of escrow, the Escrow Agent shall make the following prorations: (i) property taxes will be prorated as of the close of escrow based upon the most recent tax bill available, including any property taxes which may be assessed after the close of escrow but which pertain to the period prior to the transfer of title to the Property to Buyer, regardless of when or to whom notice thereof" is delivered; and (ii) any bond or assessment that constitutes a lien on the Property at. the close of escrow will be assumed by Buyer. Seller does not pay ad valorem taxes. 6. REPRESENTATTONS, WARRANT11;"SAND COVENANTS. 6.1 Seller"s Representations. Warranties and Covenants. In addition to the representations, warranties and covenants of Seller contained in other sections of this Agreement, Seller hereby represents, warrants and covenants to Buyer that the statements below in this Section ' 6.1 are each true and correct as of the Closing Date provided however, if to Seller's actual knowledge any such statement becomes untrue prior to Closing, Seller will notify Buyer in writing and Buyer will have three (3) business days thereafter to determine if Buyer wishes to proceed with Closing. If Buyer detennines it does not wish to proceed, then the terms of Section 3.4 will apply. _5- 21913220028.3 5-219\3220028.3 (a) Authority. Seller is a municipal corporation, lawfully formed, in existence and in good. standing under the laws of the State of California. Seller has the full right, capacity, power and authority to enter into and carry out the terins of this Agreement. This Agreement has been duly executed by Seller, and upon delivery to and execution by Buyer is a valid and binding agreement of Seller. (b) Encumbrances. Seller has not alienated, encumbered, transferred, moitgaged, assigned, pledged, or otherwise conveyed its interest in the Property or any portion thereof, nor entered into any Agreement to do so, and there are no liens, encumbrances, mortgages, covenants, conditions, reservations, restrictions, easements or other matters affecting the property, except as disclosed in the Preliminary Report. Seller will not, directly or indirectly, alienate, encumber, transfer, mortgage, assign, pledge, or otherwise convey its interest prior to the Close of Escrow, as long as this Agreement is in force. (c) 1"here are no agreements affecting the Property except those which halve been disclosed by Seller. There are no agreements which will be binding on the Buyer or the Property after the Close of Escrow, which cannot be terminated on thirty (30) days prior written notice. The truth and accuracy of each of the representations and warranties, and the performance ofall covenants of Seller contained in this Agreement are conditions precedent to Buyer's obligation to proceed with the Closing hereunder. 'I'he foregoing representations and warranties shall survive the expiration, tertnination, or close of escrow of this Agreement and shall not be deemed merged into the deed upon closing. 6.2 Buyer's Representations and Warranties. In addition to the representations, warranties and covenants of Buyer contained in other sections of this Agreement, Buyer hereby represents, warrants and covenants to Seller that the statements below in this Section 6.2 are each true as of the Effective Date, and, if to Buyer's actual knowledge any such statement becomes untrue prior to Closing, Buyer shall so notify Seller in writing and Seller shall have at least three (3) business days thereafter to determine if Seller wishes to proceed with Closing. (a) Buyer is a California limited partnership. Buyer has the Paull right, capacity, power and authority to enter into and carry out the terins of this Agreement. This Agreement has been duly executed by Buyer, and upon delivery to and execution by Seller shall be a valid and binding agreement of Buyer. (b) Buyer is not bankrupt or insolvent Linder any applicable federal or state standard, has not filed for protection or relief under any applicable bankruptcy or creditor protection statute, and has not been threatened by creditors with an involuntary application of any applicable bankruptcy or creditor protection statute. The truth and accuracy of each of the representations and warranties, and the performance of all covenants of Buyer contained in this Agreement are conditions precedent to Seller" s obligation to proceed with the Closing hereunder. 6.3 Proverty Sold. "ASIS". Buyer specifically acknowledges that the Seller is selling the Property on an "AS IS", "WHERE IS" and "WITH LI, FAULTS" basis and that, 219\3220028.3 subJect to Seller's representations, warranties, covenants and obligations set forth in this Agreement, and all exhibits attached hereto and incorporated herein, and any obligations arising under applicable law, Buyer is not relying on any representations or warranties of any kind whatsoever, express or implied, from Seller, or its employees, appointed or elected officials, agents, or brokers as to any matters concerning the Property. The Seller makes no representations or warranties as to any matters concerning the Property, including without limitation: (i) the quality, nature, adequacy and physical condition of the Property, (ii) the quality, nature, adequacy, and physical condition of soils, geology and any groundwater, (iii) the existence, quality, nature, adequacy and physical condition of utilities serving the Property, (iv) the development potential of" the Property, and the Property's use, habitability, merchantability, or fitness, suitability, value or adequacy of" the property for any particular purpose, (v) except as otherwise provided in this Agreement, the zoning or other legal status of the Property or any other public or private restrictions on use of the Property, (vi) the compliance of the Property or its operation with any Environmental Laws, covenants, conditions and restrictions of any governmental or quasi - governmental entity or of any other person or entity, (vii) the presence or removal of Hazardous Materials, substances or wastes on, under or about the Property or the adjoining or neighboring property; (viii) the quality of any labor and materials used in any improvements on the Property, (ix) the condition of title to the Property, (A) the leases, service contracts, or other agreements affecting the Property, or (Xi) the economics of the operation of the Property. 7. REMEDIES In the event of a breach or default under this Agreement by Seller, if such breach or default occurs prior to Close of Escrow, Buyer reserves the right to either (a) seek specific performance from Seller or (b) to do any of the following: (i) to waive the breach or default and proceed to close as provided herein; (ii) to extend the time for performance and the Closing Date until Seller is able to perform; or (iii) to terminate this Agreement upon written notice to Seller, whereupon Seller shall cause Escrow Holder to return to.Buyer any and all sums placed into the Escrow by Buyer, and except for the rights and obligations expressly provided to survive termination of this Agreement, neither party shall have any further obligations or liabilities hereunder, IN TI -JE EVENT OF A BREACH OR. DEFALJLT HERI`,UNDER. BY BUYER AND THE CLOSINGDOES NOTOCCUR DUE TO SUCH DEFAl.JLT, SELLER'S SOLE REMEDY SHALL BE TO RETAIN THE DEPOSIT'S AS LIQUIDATED DAMAGES. THE PARTIES AGREE THAT IN SUCH INSTANCE, THE DEPOSITS REPRESENT A. REASONABLE APPROXIMATION OFSELLER'S DAMAGES AND ARE NOT INTENDED AS A EORFEITIJRE OR PENALTY BUT RATI-JER AN ENFORCEABLE LIQLADATE D DAMAGES PROVISION PLJRSUANTT0 CALIFORNIA CIVIL CODE SECTION 1671, i,"r SEQ. IN NO EVENT SHALL EITHER PARTY BE ENTITLED TO LOST PROFITS OR CONSEQLJENTIAL DAMA.GES AS A RESULT OF THE OTHER PAR. ry',S BREACH OF '11-11S AGREEMENT Buyer's Initials Seller's Initials & BROKERS. Seller represents that no real estate broker has been retained by Seller in the sale of the Property or the negotiation of this Agreement. Buyer represents that no real estate broker has been retained by Buyer in the procurenient of the Property or negotiation of this Agreement. Buyer shall indemnify, hold harmless and defend Seller from any and all claims, -7- 219\3220028.3 actions and liability for any breach of the preceding sentence, and any commission, finder's fee, or similar charges arising out of.Buyer's conduct. 9. ASSIGNMENT. Absent an express signed written agreement between the Parties to the contrary, neither Seller nor Buyer may assign its rights or delegate its duties under this Agreement without the express written consent of the other. No permitted assignment of any of the rights or obligations under this Agreement shall result in a novation or in any other way release the assignor from its obligations under this Agreement. 10. ENVIRONMENTAL INDEMNITY. To the fullest extent allowed by law, Buyer agrees to unconditionally and fully indemnify, protect, defend (with counsel satisfactory to Seller), and hold Seller, and its respective elected and appointed officers, officials, employees, agents, consultants, contractors, and Agency harmless from and against any and all claims (including without limitation third party claims for personal injury, real or personal property damage, or damages to natural resources), actions, administrative proceedings (including without limitation both formal and informal proceedings), judgments, damages, punitive damages, penalties, fines, costs (including without limitation any and all costs relating to investigation, assessment, analysis or clean-up of the Property), liabilities (including without limitation sums paid in settlements of claims), interest, or losses, including reasonable attorneys' and paralegals' fees and expenses (including without limitation any such fees and expenses incurred in enforcing this Agreement or collecting any sums due hereunder), together with all other costs and expenses of any kind or nature (collectively, the "Costs") that arise directly or indirectly from or in connection with the presence, suspected presence, release, or suspected release, of any Hazardous Materials in, on or tinder the Property or in or into the air, soil, soil gas, groundwater, or surface water at, on, about, around, above, under or within the Property, or any portion thereof, except those Costs that arise solely as a result of actions by Seiler, or Seller's agents, employees, or contractors. The indemnification provided pursuant to this Section shall specifically apply to and include claims or actions brought by or on behalf of employees of Buyer or any of its predecessors in interest and Buyer hereby expressly waives any immunity to which Buyer may otherwise be entitled under any industrial or worker's compensation laws. In the event the Seller suffers or incurs any Costs, Buyer shall pay to Seller the total of all such Costs suffered or incurred by the Seller upon demand therefore by Seller. The indemnification provided pursuant to this Section shall include, without limitation, all loss or damage sustained by the Seller due to any Hazardous Materials: (a) that are present or suspected by a governmental agency having jurisdiction to be present in the Property or in the air, soil, soil gas, groundwater, or surface water at, on, about, above, under, or within the Property (or any portion thereof) or to have emanated from the Property, or (b) that migrate, flow, percolate, diffuse, or in any way move onto, into, or under the air, soil, soil gas, groundwater, or surface water at, on, about, around, above, under, or within the Property (or any portion thereof) after the date of this Agreement as a result of Seller's or its predecessors" activities on the Property, or those of Seller's agents, employees, or contractors. The provisions of this Section 10 shall survive the termination of this Agreement and the Close of Escrow,. 11. RELEASE BY BUYER.. Effective upon the Close of Escrow, except with respect to the representations and warranties of Seller under Section 6.1 of this Agreement, Buyer waives releases, remises, acquits and forever discharges Seller, and its officers, directors, board members, managers, employees and agents, Agency, and any other person acting on behalf of Seller, from any and all claims, actions, causes of' action, demands, rights, dannages, costs, expenses and -8- 219\3220028.3 compensation whatsoever, direct or indirect, known or unknown, foreseen or unforeseen, which Buyer now has or which may arise in the future on account of or in any way arising from or in connection with the physical condition of the Property or any law or regulation applicable thereto including, without limiting the generality of the foregoing, any federal, state or local law, ordinance or regulation pertaining to Hazardous Materials. This Section1I I shall survive the termination of this Agreement and the Close of Escrow. BUYER ACKNOWLEDGES THAT BuYER IS FAMILIAR WITH SECTION 1542 OFTHE CALIFORNIA CIVIL CODE, WHICH PROVIDES AS FOLLOWS: A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS TE AT THE CREDITOR. OR RE'LEASMG PARTY DOES NOTKNOW OR. SUSPECT TO EXIST IN HIS OR HER. FAVOR AT THE TIME OF EXECUTING THE RELEASE AND THAT, IF KNOWN BY HIM OR .HER,, WOULD HAVE MATERIALLY AFFECTED HIS OR HER, SETTLEMENT WITH THE DEBTOR. C.D.R. RELEASED PARTY. By INITIALING BELOW, BUYER. EXPRESSLY WAIVES THE BENE -FITS OF SECTION 1.542 OF THE CALIFORNIA CIVIL CODE WITH RE, SPECTTO THE FOREGOING RELEASE: Buyer's initials: 12. HAZARDOUS MAIERIALS, _D.E.FINITIONS. 12.1 Hazardous Materials. As used in this Agreement, "Hazardous Materials" means any chemical, compound, material, mixture, or substance that is now or may in the future be defined or listed in, or otherwise classified pursuant to any Environmental Laws (defined below) as a "hazardous substance", "hazardous material", "hazardous waste", "extremely hazardous waste", infectious waste", toxic substance", toxic pollutant", or any other formulation intended to define, list or classify substances by reason of deleterious properties such as ignitability, corrosivity, reactivity, carcinogenicity, or toxicity. The term "Ilazardous Materials" shall also include asbestos or asbestos -containing materials, radon, chrome and/or chromium, polychlorinated biphenyls, petroleum, petroleum products or by-products, petroleum components, oil, mineral spirits, natural gas, natural gas liquids, liquefied natural gas, arid synthetic gas usable as fuel, perchlorate, and methyl tent butyl ether, whether or not defined as a hazardous waste or hazardous substance in the Environmental Laws. 12.2 Environmental Laws. As used in this Agreement, "Environmental Laws" means any and all federal, state and local statutes, ordinances, orders, rules, regulations, guidance documents, judgments, governmental authorizations or directives, or any other requirements of governmental authorities, as may presently exist, or as may be amended or supplemented, or hereafter enacted, relating to the presence, release, generation, use, handling, treatment, storage, transportation or disposal of Hazardous Materials, or the protection of the environment or human, plant or animal health, including, without limitation, the Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended by the Superfund Amendments and Reauthorization Act of 1986 (42 U.S.C. § 9601), theflazardous Materials Transportation Act (49 -9- 219\3220028.3 U.S.C. § 1801 est s€ the Meso urce Conservation and Recovery Act (42 U.S.C. § 6901 et seq.), the Federal Water Pollution Control Act (33 U.S.C. § 1251 et seq.), the Clean Air Act (42 U.S.C. § 7401 et seq.), the'roxic Substances Control Act (.15 U.S.C. § 2601 et seq.), the Oil Pollution Act (33 U.S.C. § 2701 el seq.), the Emergency Planning and Community Right -to -Know Act (42 U.S.C. § 11001 elseq.), the Porter- Cologrie Water Quality Control Act (Cal. Water Code § 13000 et seq.), the Toxic Mold Protection Act (Cal. Health & Safety Code § 26100, etseq.), the Safe Drinking Water and. Toxic Entbreement Act of 1986 (Cal. Health & Safety Code § 25249.5 et Seq.), the Hazardous Waste Control Act (Cal. Health & Safety Code § 25 100 et seq.), the Hazardous Materials Release Response Plans & inventory Act (Cal. Health & Safety Code § 25500 et seq.), and the Carpenter -Presley -Tanner Hazardous Substances Account Act (Cal. Flealth and Safety Code, Section 25300 et seq.). 13. M.]SCELLANEOUS. 13.1 Attorneys' Fees. Ifany party employs counsel to enforce or interpret this Agreement, including the commencement of any legal proceeding whatsoever (including insolvency, bankruptcy, arbitration, mediation, declaratory relief or other litigation), the prevailing party shall be entitled to recover its reasonable attorneys' fees and court costs (including the service of process, filing fees, court and court reporter costs, investigative fees, expert witness fees, Lind the costs of any bonds, whether taxable or not) and shall include the right to recover such fees and costs incurred in any appeal or efforts to collect or otherwise enforce any judgment in its favor in addition to any other remedy it may obtain or be awarded. Any judgment or final order issued in any legal proceeding shall include reimbursement for all such attorneys' fees and costs. In any legal proceeding, the "prevailing party" shall can the party determined by the court to most nearly prevail and not necessarily the party in whose favor a judgment is rendered. 13.2 Interpretation. This Agreement has been negotiated at arm's length and each party has been represented by independent legal counsel in this transaction and this Agreement has been reviewed and revised by counsel to each of the Parties. Accordingly, each party hereby waives any benefit under any rule of law (including Section 1654 of the California Civil Code) or legal decision that would require interpretation of any ambiguities in this Agreement against the drafting party. 13.3 Survival. All indemnities, covenants, representations and warranties contained in this Agreement shall survive Close of Escrow. 13.4 Successors. Except as provided to the contrary in this Agreement, this Agreement shall be binding on and inure to the benefit of the Parties and their successors and assigns. 13.5 Qovernin > I aver. This Agreement shall be construed and interpreted in accordance with the laws of the State of California. .13.6 Integrated A&,,reement-, — --odifications.. This Agreement contains all the M agreements of the Parties concerning the suject hereof any cannot be amended or modified except by a written instrument executed and delivered by the parties. There are no representations, agreements, arrangements or understandings, either oral or written, between or among the parties -10- 219\3220028.3 hereto relating to the subject matter of this Agreement that are not fully expressed herein. In addition there are no representations, agreements, arrangements or understandings, either oral or written, between or ainong the Parties upon which any party is relying upon in entering this Agreement that are riot fully expressed herein. 13.7 Severabilfty. If any term. or provision of this Agreement is determined to be illegal, unenforceable, or invalid in whole or in part for any reason, such illegal, unenforceable, or invalid provisions or part thereof shall be stricken from this Agreement, any such provision shall riot be affected by the legality, enforceability, or validity oft e remainder of this Agreement. If any provision or part thereol"of this Agreement is stricken in accordance with the provisions of this Section, then the stricken provision shall be replaced, to the extent possible, with a legal, enforceable and valid provision this is in keeping with the intent of'th.e Parties as expressed herein. 13.8 Notices. Any delivery of this Agreement, notice, modification of this Agreement, collateral or additional agreement, demand, disclosure, request, consent, approval, waiver, declaration or other communication that either party desires or is required to give to the other party or any other person shall be in writing. Any such communication may be served personally, or by nationally recognized overnight delivery service (ie., Federal Express) which provides a receipt of delivery, or sent by prepaid, first class mail, return receipt requested to the party's address as set forth below: To Buyer: 938 Linden, LP Attn: Robert Delue 2486 Butternut Drive Ifillsborouo, i, CA 94010 Telephone No.: 650-342-2524 With a copy to (which shall not constitute notice): Chris Giotinis SC Properties 311 S. Ellsworth Ave San Mateo, CA 94401 Telephone No.: 650-4654028 Email: cgiotinis(a-,)scpropsm.com 'ro Seller: City of' South San Francisco 400 Grand Avenue South San Francisco, CA 94080 Attn: City Manager, Mike Futrell Telephone No.: (650) 829 6620 Fax (650) 829-6609 If to Escrow I-Iolder: Katie Berggren 219\32200283 North American Title Company 66 Bovet Rd, Suite 200 San Mateo, CA 94402 Any such. communication shall be deemed effective upon personal. delivery or on the date of first refusal to accept delivery as reflected on the receipt of delivery or return receipt, as applicable. Any party may change its address by notice to the other party. Each party shall make an ordinary, good faith effort to ensure that it will accept or receive notices that are given in accordance with this section and that any person to be given notice actually receives such notice. 13.9 Time. Time is of the essence to the perfon.,nance of each and every obligation under this Agreement. 13.10 1 �)�as of�Week. If any date fbr exercise of any right, giving of any notice, or performance of any provision of this Agree ment falls on a Saturday, Sunday or holiday, the time for performance will be extended to 5:00 p.m. on the next business day. 13.11 Reasonable ConsgnLand.Approval. Except as otherwise provided _ in this Agreement, whenever a party is required or permitted to give its consent or approval under this Agreement, such consent or approval shall not be unreasonably withheld or delayed. If a party is required or permitted to give its consent or approval in its sole and absolute discretion or if such consent or approval may be unreasonably withheld, such consent or approval may be unreasonably withheld but shall not be unreasonably delayed. 13.12 Further Assurances. 'I"he Parties shall at their own cost and expense execute and deliver such further documents and. instruments and shall take such other actions as may be reasonably required or apl)ropriate to carry out the intent and purposes of this Agreement.. 13.13 Waivers. Any waiver by any party shall be in writing and shall not be construed as a continuing waiver. No waiver will beimplied from any delay or failure to take action on account of any default by any party. Consent by any party to any act or omission by another party shall not be construed to be consent to any other subsequent act or omission or to waive the requirement for consent to be obtained in any future or other instance. 1114 SSignatures/Couunterparts. This Agreement may be executed in two or more counterparts, each of` which shall be deemed art original, but all of which together shall constitute one and the same instrument. Any one of such completely executed counterparts shall be sufficient proof of this Agreement. 13.15 Date qtrid Deliver �W-Qejj�r ofAgyreement. 'Notwithstandinganything; to the contrary contained. in this Agreement, the parties intend that this Agreement shall be deemed effective, and delivered for all purposes under this Agreement, and for the calculation of any statutory time periods based on the date an agreement between parties is effective, executed, or delivered, as of the Effective Date. 13.16 Representation on AuthojjjX_of" j!g.q:AKs. Each person signing this Agreement represents and warrants that he or she is duly authorized and has legal capacity to execute and deliver this Agreement. Each party represents and warrants to the other that the -12- 219\3220028.3 execution and delivery of the Agreement and the performance of such party's obligations hereunder have been duly authorized and that the Agreement is a valid and legal agreement binding on such party and enforceable in accordance with its terms. 13.17 Possession. At Closing, Seller shall deliver sole and exclusive possession of the Property to Buyer. 13.18 Approvals. Whenever this Agreement calls for Seller approval, consent, extension or waiver, the written approval, consent, or waiver of the Seller's Executive Director or his or her designee(s) shall constitute the approval, consent, extension or waiver of the Seller, without further authorization required from the Seller's Council. The Seller hereby authorizes the City Manager and his or her designee(s) to deliver any such approvals, consents, or extensions or waivers as are required by this Agreement, or that do not otherwise reduce Seller's rights under this Agreement, and to waive requirements under this Agreement, on behalf of the Seller. -13- 219\3220028.3 3- 21913220028.3 IN WITNESS WHEREOF, the Parties have executed this Agreement as of the date first written above. SELLER: CITY OF SOUTH SAN FRANCISCO By: Mike Futrell City Manager ATTEST: By_.. ......._.._ --- .. -- City Clerk APPROVED AS TO FORM: By: Jason Rosenberg City Attorney BUYER: 938 Linden, LP, a limited partnership By_----- Title: APPROVED AS TO FORM: By: Counsel for Buyer -14- 219\3220028.3 LIST OF EXHIBITS Exhibit A Legal Description Exhibit B Grant Deed Exhibit C Permitted Exceptions 219\3220028.3 Exhibit A LEGAL DESCRIPTION 219\3220028.3 Exhibit B -l7- u/;o2zon m.3 Exhibit C PERMITTED EXCEPTIONS -18- 219\3220028.3