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HomeMy WebLinkAboutOrd 1308-2002ORDINANCE NO. 1308-2002 AB- ORDINANCE ADOPTING A DEVELOPMENT AGREEMENT WITH SLOUGH SSF FOR THE BRITANNIA EAST GRAND PROJECT WHES~EAS, the South San Francisco Municipal Code allows development of the approximately 26.9 acre site located at the easterly terminus of East Grand Avenue as a campus style Research and Development project; subject to further approvals; and, WHE?,EAS, Slough SSF LLC submitted plans consisting of a Master Site Plan and Site Plan, Phase 1 and Phase 2, Sheet No. Al. 1, Conceptual Building Design Guidelines, Schematic Landscape Plan and prel:_minary grading and utility plans dated May 4, 2001; and, WHERAS, said plans, together with the additional floor plans and parking structure plans, propose development of a 758,533 square foot office/R&D campus with ancillary childcare center, fitness center and retail and restaurant space; and, WHEREAS, the 758,533 square foot office/R&D project, together with the ancillary uses and parking structures ("Project") constitutes the present proposed development and is the project subject to the terms of the Development Agreement ("Agreement"); and, WHEREAS, a Environmental Impact Report has been prepared which analyzes the anticipated environmental impacts of the proposed Project; and, WHEREAS, the Owner has requested the City to process the proposed entitlements for the Project; and, WHEREAS, pursuant to Municipal Code section 19.60.050, the Director of Economic and Community Development has conducted required reviews and found the proposed Agreement to be in the proper form, determined that the application was complete, and referred the Agreement to the Planning Commission for a public hearing; and, WHEREAS, on March 7, 2002, the Planning Commission held a properly noticed public heating on the Britannia East Grand Project and recommended that a final decision on the Project be continued until April 4, 2002; and, WHEREAS, on April 4, 2002, the Planning Commission held a duly noticed public hearing on the proposed Agreement and recommended by a 7 to 0 vote that the City Council adopt the Ordinance and Development Agreement; and, WttEREAS, on April 24, 2002, pursuant to Municipal Code section 19.060.110 the City Council conducted a properly noticed public hearing on the proposed Agreement for the project. NOW THEREFORE, the City Council of the City of South San Francisco does ordain as follows: Section 1. Findings The Project consists of a 758,533 square foot office/R&D campus with ancillary childcare center, fitness center and retail/restaurant space on a 26.9 acre site located at the easterly terminus of East Grand Avenue, and which includes requested exceptions for numbers of parking spaces. These findings are based on public testimony and the materials submitted to the City of South San Francisco City Council which include, but are not limited to: "Master Site Plan" and the "Site Plan, Phase 1 and Phase 2," Sheet No. Al.l, "Conceptual Building Design Guidelines," "Schematic Landscape Plan," and preliminary grading and t~tility plans dated May 4, 2001, prepared by DES Architects/Engineers; Floor plans and elevations for Buildings 1 & 2, and Parking Garage A dated August 3, 2001, floor plans and elevations for Building 3 dated September 7, 2001, and floor plans and elevations for Buildings 4, 5, 6, 7, 8, & 9 dated Octobe:: 5,2001, prepared by DES Architects/Engineers; "Preliminary Transportation Demand Management ?rogram," dated March 7, 2002, prepared by Sequoia Solutions Consulting; Britannia East Grand Environmental Impact Report (Draft EIR, Recirculation Draft EIR and Final EIR Response to Comments); minutes of the August 21, 2001, September 18, 2001 and October 16, 2001 Design Review Board meetir_gs; Planning Commission staff reports dated November 15, December 20, 2001, and January 17, March 7 and April 4, 2002; and testimony received at the November 15, December 20, 2001, and January 17, March 7 and April 4, 2002 Planning Commission meetings; and testimony, staff reports and other written materials and oral testimony received at the duly noticed public heating of the City Council on April 24, 2002: The proposed Development Agreement for the Britannia East Grand Project is consistent with the objectives, policies, general land uses and programs specified in the General Plan, as amended and adopted. The Project provides high value jobs for persons in the bio-technology fields and the campus style development that includes recreation opportunities, child care and public transportation options is consistent with the General Plan policies set forth below: this finding is based upon all evidence in the record as a whole, including, but not limited to: the City Council's independent review of the General Plan and the findings set forth in below. Subject to approval of General Plan Amendment GP-01-006, the project is consistent with the General Plan which designates the property for a mix of Business and Technology Park and Coastal Commercial. Office/R&D use is considered an appropriate use under this designation. Additionally, the category provides for a floor area ratio (FAR) of .50, with permissible increases to a maximum FAR of 1.0 based on implementation of a Transportation Demand Management (TDM) program as outlined in the City's TDM Ordinance. The proposed FAR of .67 requires that the applicant prepare, implement and maintain a TDM Plan designed to achieve a 30% shift to alternative modes of travel other than single occupant vehicles. The following policies specifically support the proposed project: Bo Guiding Policy 3.5-G-3 - Promote campus-style biotechnology, high technology, and research and development uses. The Project is a multi- phase, mixed-use, office/research and development project intended to be occupied by bio-technology or other high-technology tenants. The Project also makes use of underutilized property in a prominent bay side location that was formerly heavy industrial. 3.5-1-8 - Encourage the development of employee-serving amenities with restaurants, cafes, to support commercial establishments. The Project includes ancillary retail and restaurant services designed to serve tenant employees. 2-G-9- Facilitate development of childcare centers and homes in all areas, and encourage inclusion of childcare centers in non-residential development. The Project includes an on-site childcare center of approximately 8,000 square feet. Construction of the child care center is secured through the Development Agreement even if environmental constrictions on the site prohibit construction of the center on-site. In the event the child care center cannot be constructed on-site, the Owner must construct a center on an off-site location acceptable to the City. The proposed project is consistent with the East of 101 Area Plan which the General Plan identifies as the guide for detailed implementation of General Plan policies. Policy LU- 16 supports development of campus settings and promotes the concept of "Master Plans," including facility wide development standards, for sites of 20+ acres. In addition, the proposed project is consistent with the Design Policies of the East of 101 Area Plan, and specifically with Policy DE-22, which specifies that on-site open space should serve as a unifying element, by connecting separate buildings and providing usable employee spaces. The proposed Development Agreement for the Britannia East Grand Project complies with all applicable zoning, subdivision, and building regulations and with the general plan. The City Council independently reviewed the proposed Development Agreement for the Britannia East Grand Project, the General Plan, Chapters 20.78 and 20.84 of the Zoning Ordinance as amended, Chapter 19.60 of the South San Francisco Municipal Code, Title 15 of the Municipal Code, and applicable state and federal law. This finding is based upon all evidence in the record as a whole, including, but not limited to: the City Council's independent review of these documents and advice in the record from City staff, including staff reports, testimony and resolutions. The Project incorporates a Transportation Demand Management program consistent with the requirements of Municipal Code Chapter 20.125 et. seq. The Development Agreement imposes requirements to ensure the Project attains the required alternative mode use or pays a penalty for non-compliance. Co Do Fo Go The proposed Development Agreement for the Project states its specific duration. This finding is based upon all evidence in the record as a whole, including, but not limited to: the City Council's independent review of the proposed Development Agreement for the Britannia East Grand Project and its determination that Section 2 of the Agreement states that the Agreement shall expire ten years from the effective date of the Agreement but no later than May 1, 2017. The proposed Development Agreement for the Britannia East Grand Project, which incorporates as an exhibit the Planned Unit Development Permit and Plan Sets attached thereto, states the permitted uses of the property subject. This finding is based upon all evidence in the record as a whole, including, but not limited to: the City Council's independent review of the proposed Development Agreement for the Britannia East Grand Project and its determination that Section 3 of the Agreement sets forth the documents which state the permitted uses. The proposed Development Agreement for the Britannia East Grand Project states the permitted density and intensity of use of the property subject thereto. This finding is based upon all evidence in the record as a whole, including, but not limited to: the City Council's independent review of the proposed Development Agreement for the Britannia East Grand Project and its determination that Section 3 of the Agreement sets forth the documents which state the permitted density and intensity of use. The proposed Development Agreement, and exhibits attached thereto and incorporated therein, for the Britannia East Grand Project states the maximum permitted height and size of proposed buildings on the property subject thereto. This finding is based upon all evidence in the record as a whole, including, but not limited to: the City Council's independent review of the proposed Development Agreement for the Britannia East Grand Project and its determination that Section 3 of the Agreement sets forth the documents which state the maximum permitted height and size of buildings. The proposed Development Agreement for the Britannia East Grand Project describes the land, if any, which will be dedicated for public purposes from the property subject thereto. This finding is based upon all evidence in the record as a whole, including, but not limited to: the City Council's independent review of the proposed Development Agreement for the Britannia East Grand Project and its determination that Exhibit B to the Agreement, the Planned Unit Development Permit and Plan set(s) dated May 4, 2001, September 7, 2001 and October 5, 2001, describes the land, if any, which will be dedicated for public purposes. Section 2. The City Council of the City of South San Francisco hereby adopts this ordinance approving a Development Agreement between the City of South San Francisco and Slough SSF, LLC for the Britannia Eas: Grand Project. The approved Development Agreement is attached hereto as Exhibit A and incorpora:ed herein by reference. Section 3. Severability. In the event ar.y section or portion of this ordinance shall be determined invalid or unconstitutional, such section or poEion shall be deemed severable and all other sections or portions hereof shall remain in full force and effect. Section 4. Publication and Effective Date. Pursuant to tl'_e provisions of Government Code Section 36933, a summary of this Ordinance shall be prepared by the City Attorney. At least five (5) days prior to the Council meeting at which this Ordinance is scheduled to be adopted, the City Clerk shall (1) publish the Summary, and (2) post in the City Clerk's Office a certified copy of this Ordinance. Within fifteen (15) days after the adoption of this Ordinance, tl~e City Clerk shall (1) publish the summary, and (2) post in the City Clerk's Office a certified copy of the full text of this Ordinance along with the names of those City Council members voting for an/_ against this Ordinance or otherwise voting. This ordinance shall become effective thirty days from and after its adoption. Introduced at a regular meeting of the City Council of the City of South San Francisco, held the 24th day of April, 2002. Adopted as an Ordinance of the City of South Francisco at a regular meeting of the City Council held the 8th day of May, 2002 by the following vote: AYES: Councilmembers Joseph A. Femekes, Raymond L. Green and Karyl Matsumoto, Mayor Pro Tem Pedro Gonzalez and Mayor Eugene R. Mullin NOES: None. ABSTAIN: None. ABSENT: None. ATTEST: (ff City Clerk As Mayor of the City of South San Francisco, I do hereby approve the foregoing Ordinance this 8th day of May, 2002. ~ Mayor~ ~ EXHIBIT A DEVELOPMENT AGREEMENT BRITANNIA EAST GRAND PROJECT This DEVELOPMENT AGREEMENT FOR BRITANNIA EAST GRAND PROJECT ("PROJECT") is dated ,2002 ("Agreement"), between SLOUGH SSF, LLC, a Delaware limi-.ed liability company ("Owner"), and the CITY OF SOUTH SAN FRANCISCO, a municipal corporation organized and existing under the laws of the State of California ("City"). Owner and City are collectively referred to herein as "Parties." RECITALS A. WHEREAS, California Government Code Sections 65864 through 65869.5 authorize the City to enter into binding development agreements with persons having legal or equitable interests in re~_l property for the development of such property or on behalf of those persons having same; and, B. WHEREAS, Slough SSF, LLC, the Owner, has a legal interest in the real property subject to this Agreement; and, C. WlqEREAS, pursuant to Government Code Section 65865, the City has adopted roles and regulatior_s, embodied in Chapter 19.60 of the South San Francisco Municipal Code, establishing procedures and requirements for adoption and execution of development agreements; a'ad, D. WHEREAS, this Agreement concerns property at the Eastern terminus of East Grand Avenue, formerly known as the Fuller O'Brien site, as shown and more particularly described in Exhibit A attached hereto and incorporated herein by reference ("Property"); and, E. WHE_'~EAS, the Owner has submitted a development proposal to the City, commonly known as the Britannia East Grand Project, consisting of the phased development of nine office/Research and Development buildings with a resulting square footage of approximately 783,533 square feet, an approximately 8,000 square foot childcare facility, an approximately 5,000 square -.'oot fitness center, approximately 8,000 square feet of restaurant/retail space and two (2) five-to-seven level parking structures as depicted on the Britannia East Grand Planned Unit Development Plan Set dated ,2001, prepared by , including the application for a General Plan Amendment and Use Permit, dated ,2001, attached hereto as Exhibit B and incorporated herein by reference (the "Plan Set"), to be located on the Property (the "Project"); and, F. WHEREAS, Owner has requested that the City enter into this Agreement to set forth the rights and obligations of the parties relating to the development of the Project; and, Page 1 of 21 Britannia East Grand Development Agreement May 8, 2002 G. WHEREAS, all proceedings necessary for the valid adoption and execution hereof have taken place in accordance with Government Code Sections 65864 through 65869.5, the California Environmental Quality Act and with Chapter 19.60 of the South San Francisco Municipal Code; and, H. WHEREAS, the City Council and the Planning Commission have found that this Agreement is consistent with the objectives, policies, general land uses and programs specified in the South San Francisco General Plan as adopted on October 13, 1999 and as amended from time to time; and, I. WH~E_-IEAS, on May 8th, 2002, the City Council adopted Ordinance No. approving and adopting this Agreement and the Ordinance thereafter took effect on 2002. AGREEMENT NOW, THEREFORE, the Parties, pursuant to the authority contained in Government Code Sections 65864 through 65869.5 and Chapter 19.60 of the South San Francisco Municipal Code and in consideration of the mutual covenants and agreements contained herein, agree as follows: 1. Effecl5ve Date Pursuant to Chapter 19.060.140, notwithstanding the fact that the City Council adopts an ordinance approving this Agreement, the Agreement shall be effective and shall only create obligations for the Parties from and after the date that the ordinance approving this Agreement takes effect ("Effective Date"). 2. Duration This Agreement shall expire ten (10) years from the Effective Date of this Agreement, but in no event later than May 1, 2017. In the event that litigation to which the City is a party against the Owner or any of its officers, agents, employees, contractors, representatives or consultants should delay implementation or construction of the Project on the Property, the expiration date of this Agreement shall be extended for a period equal to the length of time from the time the summons and complaint is served on the defer_dant(s) until the judgment entered by the court is final and not subject to appeal; provided, however, that the total amount of time for which the expiration date shall be exter.ded as a result of such litigation shall not exceed five (5) years. 3. Project Description; Development Standards For Project The Project shall consist of nine Office/Research and Development buildings totaling approximately 783,533 square feet, an approximately 8,000 square foot childcare facility, an approximately 5,000 square foot fitness center, approximately 8,000 square feet of Page 2 of 21 Britannia East Grand Development Agreement May 8, 2002 retail/restaurant space, two five to seven level parking garages and other structures and improvements as provided in the Plan Set and as approved by the City Council. (a) The permitted uses, the density and intensity of uses, the maximum heights, locations and total area of the proposed buildings, the development schedule, the provisions for vehicular access and parking, any reservation or dedication of land, any public improvements, facilities and services, and all environmental impact mitigation measures imposed as approval conditions for the Project, shall be exclusively those provided in the Plan Set, Planned Unit Development permit, Development Plan, Environmental Impact Report and this Agreement as approved by the City Council and the applicable ordinances in effect as of the Effective Date, except as modified in this Agreement, and applicable provisions of the South San Francisco Municipal Code as in effect on the Effective Date. (b) Subject to Owner's fulfillment of its obligations under this Agreement, upon the Effective Date of this Agreement, the City hereby grants to Owner a vested right to develop and construct on the Property all the improvements for the Project authorized by, and in accordance with the terms of this Agreement, the Plan Set as approved by the City Council and the applicable ordinances in effect as of the Effective Date. (c) Upon such grant of right, no future amendments to the City General Plan, the City Zoning Code, the City Municipal Code, or other City ordinances, policies or regulations in effect as of the Effective Date shall apply to the Project, except such future modifications that are not in conflict with and do not prevent the development proposed in the Plan Set and as approved by the City Council; provided, however, that nothing in this Agreement shall prevent or preclude the City from adopting any land use regulations or amendments expressly permitted herein or otherwise required by State or Federal Law. Oblig~.tions of City and Owner. (a) In consideration of the entitlements conferred upon owner, Owner has agreed to implement the obligations of Owner set forth in Exhibit C attached hereto and incorporated herein, according to the terms and conditions set fo/th therein. In consideration of the rights and benefits conferred upon the City and the public by the Owner pursuant to this Agreement, the City has agreed to implement the obligations of the City set forth in Exhibit C attached hereto and incorporated herein, according to the terms and conditions set forth therein. 5. Permits For Project. Owner shall submit a Development Plan for development of the Project at the earlier of July 31, 2003, or within sixty (60) days of applying for a grading permit for the project. The Development Plan shall address, at a minimum, the landscaping and common Page 3 of 21 Britannia East Grand Development Agreement May 8, 2002 improvements required for each phase of the Project. In connection with said Development Plan, Owner shall provide to the City an Irrevocable Letter of Credit in the l form attached as Exhibit D, approved by the City Attorney, in an amount equal to One Hundred and Twenty Five Percent (125%) of the estimated reasonable costs to construct the common improvements identified in the approved plan. Said Letter of Credit shall be submitted within 60 days of receiving a grading permit for any phase of the Project. The City may draw under the Letter of Credit as provided below to complete the landscaping and common improvements and to reimburse the City for costs related thereto. The Letter of Credit shall be reduced as the landscaping and common improvements are completed by Owner and accepted by City in an amount equal to the completed improvements and landscaping's proportionate share of the original 125% Letter of Credit. If Owner fails to complete the landscaping and common improvements in accordance with 5(e) below, City shall be entitled to withdraw funds from the Letter of Credit and comp ete said improvements. City shall also be entitled to draw funds under the Letter cf Credi: in the event Owner obtains a grading permit for any phase of the Project and 1) Owner fails to request a building permit or Certificate of Occupancy for any building within that phase by December 31, 2011 or 2) Owner fails to complete the landscaping and common improvements by December 31,2011. For each phase, the City shall issue building pe~its and Certificates of occupancy only after -.he City has reviewed and approved Owner's applications therefor. City staff review of applications for permits or other entitlements shall be limited to determining whether the following conditions are met: (a) The application is complete; and, (b) Owner has complied with the conditions of the City Council's approval of the Project, all applicable Uniform Codes, the South San Francisco Municipal Code. CEQA requirements, including any required mitigation measures, governing issuance of such permits or certificates and Federal and State Laws; and, (c) Owner has obtained Design Review approval for the Project, including required! approval of Landscape and Common Improvements; and, i (d) All applicable processing, administrative and legal fees have been paid subject to the provisions of this Agreement; and, (e) For Certificates of Occupancy only, Owner has completed, and City has approved, the landscaping and other improvements for earlier phases of the Project. Page 4 of 21 Britannia East Grand Development Agreement May 8, 21 ~}2 -- 6. Vesting of Approvals. Upon :he City's approval of the Planned Unit Development Permit, General Plan Amendment and Use Permit, such approvals shall vest in Owner and its successors and assigns for the term of this Agreement provided that the successors and assigns comply with the terms and conditions of said permit, including, but not limited to, submission of insurance certificates and bonds for the grading of the Property and construction of improvements. 7. Cooperation Between Parties in Implementation of This Agreement. The Owner and City shall proceed in a reasonable and timely manner, in compliance with t.ae deadlines mandated by applicable agreements, statutes or ordinances, to comp_ete all steps necessary for implementation of this Agreement and development of the Property in accordance with the terms of this Agreement. The City shall proceed in an expeditious manner to complete all actions required for the development of the Project, including but not limited to the following: (a) Scheduling all required public hearings by the City Council and City Planning Commission; and Processing and checking all maps, plans, permits, building plans and specifications and other plans relating to development of the Property filed by Owner or its nominee, successor or assign as necessary for development of the Property, and inspecting and providing acceptance of or comments on work by Owner that requires acceptance or approval by the City. (c) Owner, in a timely manner, shall provide City with all documents, applications, plans and other information necessary for the City to carry out its obligations hereunder and to cause its planners, engineers and all other consultants to submit in a timely manner all necessary materials and documents. It is the Parties' express intent to cooperate with one another and diligently work to implement all land use and building approvals for development of the Property in accordance with the terms of this Agreement. 8. Acquisition of Other Property; Eminent Domain In order to facilitate and insure development of the Project in accordance with the Plan Set aad the City Council's approval, the City may assist Owner, at Owner's request and at Owner's sole cost and expense, in acquiring any easements or properties necessary for the satisfaction and completion of any off-site components of the Project required by the City Council to be constructed or obtained by Owner in the Council's approval of the Project and the Plan Set, in the event Owner is unable to acquire such easements or properties or is unable to secure the necessary agreements with the applicable property owners for such easements or properties. Owner expressly acknowledges that the City is unde: no obligation to use its power of Eminent Domain. Page 5 of 21 Britannia Eas: Grand Development Agreement May 8, 2002 -- 9. Maintenance Obligations on Property 10. All of the Property subject to this Agreement shall be maintained by Owner or its successors in perpetuity. The Property shall be maintained in accordance with City requirements to prevent accumulation of litter and trash, to keep weeds abated, and to provide erosion control, and other requirements set forth in the South San Francisco Municipal Code, subject to City approval. (a) If Owner subdivides the property or otherwise transfers ownership of a parcel or building in the Project to any person or entity such that the Property is no longer under single ownership, Owner shall first establish an Owner's Association and submit Conditions, Covenants and Restrictions to the City for review and approval by the City Attorney. Said CC&Rs shall satisfy the requirements of Municipal Code section 19.36.040. Any provisions of the conditions, covenants, and restrictions governing the Project relating to the maintenance obligations under this section shall, be enforceable by the City. Fees. No future fee requirements, other than those identified herein, imposed by the City or changes to existing fee requirements (other than those currently subject to annual increases as specified in the adopting or implementing Resolutions and Ordinances) that occur on or after the Effective Date of this Agreement, shall apply to the Project. Owner shall .'aot be responsible for any fees imposed by the City in connection with the development and construction of the Project, except as otherwise set forth in this Agreement and/or the Planned Unit Development permit and those in existence as of the Effective Date of this Agreement. (a) Revised Application Fees. Any existing application, processing, administrative, legal and inspection fees that are revised during the term of this Agreement shall apply to the Project provided that (1) such fees have general applicability; (2) the application of such fees to the Property is prospective; and (3) the application of such fees would not prevent development in accordance with this Agreement. (b) Sewer Facilities Fee. The City is currently studying, pursuant to Government Code section 66000, the "Mitigation Fee Act," adoption of a Sewer Facility Impact Fee. Until such fee is adopted, Owner shall pay a fee in the amount of one dollar and twenty-three cents ($1.23) per gross square foot within the Project, including the Child Care Facility, Recreation Facility and restaurant and retail uses, excluding the parking structures. Said fee shall be paid with respect to each applicable building within the Project upon issuance of a building permit for such building in accordance with the following: (1) If the City adopts a Sewer Facility Impact Fee (Adopted Fee) that is less than the amount stated above, then Owner shall be entitled to a credit in the amount of the difference between the sewer facility fee paid for the buildings as to Page 6 of 21 Britannia East Grand Development Agreement May 8, 2002 which a fee has already been paid and the amount that would have been paid for such buildings under the Adopted Fee if it had been in effect at the time the applicable building permits were issued. The credit shall be applied to the amount of the sewer facility fees due upon the next building permit(s) issued for the Project; provided, however, that if such a credit arises after all building permits for the Project have been issued or if there is a remaining credit balance after all building permits for the Project have been issued, then City shall pay the remaining credit balance when Owner receives a Certificate of Occupancy for the last building in the Project. (2) Following adoption of the Adopted Fee, Owner shall thereafter pay, upon issuance of a building permit for each building in the Project (excluding parking structures), the amount of the Adopted Fee due for such building pursuant to the terms of the Adopted Fee as in effect at the date the applicable building permit is issued (including any increases specified in the Resolution or Ordinance establishing the Adopted Fee), provided that in no event shall the rate Owner is required to pay exceed One Dollar and Forty Cents ($1.40) per gross square foot. (3) The Sewer Facility Fee paid shall be in addition to Owner's obligation to construct, at its sole cost and expense, a new Swift Sewer Main between the boundary of the Project site and the City's pump station at the intersection of Swift Avenue and Kimball Way as required in the Final Environmental Impact Report and the necessary improvements to Station No. 3. The new Swift Sewer Main and all other works of public improvements and/or utilities shall be completed in accordance with plans designed to City standards and approved by the City Engineer prior to construction. (4) Owner shall submit plans for the construction of the new Swift Sewer Main and the Station No. 3 upgrades on or before July 1, 2002. City shall endeavor to review and provide its determination on said plans on or before September 1, 2002 or within ninety days from the time the complete plans are submitted, whichever is earlier. Owner shall submit a Letter of Credit in the amount of 125% of the estimated reasonable costs, as determined by the City Engineer in accordance with City standards at the time said plans are approved. The Letter of Credit shall be in a form approved by the City Attorney and contain no limitations on the City's ability to withdraw funds for the purposes of constructing the Swift Sewer Main and constructing the improvements required for Station No. 3, including all costs related thereto. If Owner fails to submit plans for the new Swift Sewer Main and Station No. 3 upgrades on or before December 31, 2002, Owner shall submit the above Letter of Credit based on the City's estimated reasonable costs to construct the improvements, presently estimated at Two Million Eight Hundred Thousand Dollars. (5) Owner shall have completed construction, and received final acceptance by the City, of the new Swift Sewer Main and Station No. 3 upgrades at the Page 7 of 21 Britannia East Grand Development Agreement May 8, 2002 11. earlier of October 31, 2003, or prior to receiving a Certificate of Occupancy for the fourth building in the Project due to the fact the existing sewer infrastructure cannot accommodate Project build-out beyond the third occupied building. If Owner fails to construct, or receive acceptance of, the new Swift Sewer Main and Station No. 3 upgrades prior to the earlier of requesting the fourth Certificate of Occupancy for the Project or October 31, 2003, City shall be entitled to complete the improvements using the funds secured by the Letter of Credit based on the approved plans or if Owner has not submitted plans, the plans prepared by the City for the completion of the new Swift Sewer Main and Station No.3 upgrades. (6) If projects are developed in the East of 101 area that will receive a benefit from Owner's construction of the new Swift Sewer Main and the improved Station No. 3, Owner shall be entitled to reimbursement from said project owners based on the benefits received by the new project, as reasonably calculated and determined by the City Engineer based on actual and/or reasonably estimated sewer flows within the main and from the Owner's documented costs to design, construction and obtain permits for the new Swift sewer main and Station No. 3 upgrades. The City shall furnish a copy of the City Engineer's draft determinations under the preceding sentence to Owner for review and comment prior to finalizing such determinations. The terms of reimbursement shall be set forth in an agreement between the project owners and Owner ("Reimbursement Agreement") in a form approved by the City Engineer. City shall ensure that any future projects that benefit from the new Swift Sewer Main and/or the Station No. 3 upgrades contain a Condition of Approval that requires the applicant to enter into said Reimbursement Agreement with Owner. (c) Child Care. As part of the Project, Owner proposes to construct a childcare facility of approximately 8,000 square feet. If Owner fails to construct the childcare facility according to the terms set forth in Exhibit C to this Agreement, Owner shall be liable for payment of a fee in the amount of the City's cost to construct a like facility in accordance with Exhibit C. (d) Northbound On-Ramp Mitigation Fee: The Environmental Impact Report for the Project identified a significant impact relating to the northbound on-ramps to U.S. 101 at South Airport Boulevard. To mitigate this impact to a level of less than significant, Owner shall pay a fee to mitigate the impacts to the northbound on- ramps to U.S. 101 at South Airport Boulevard in accordance with the applicable provisions of Exhibit C. New Taxes. Any subsequently enacted city-wide taxes shall apply to the Property provided that: (1) the application of such taxes to the Property is prospective; and (2) the application of such taxes would not prevent development in accordance with this Agreement. Page 8 of 21 Britannia Eas; Grand Development Agreement May 8, 2002 12. Assessmmts Nothing herein shall be construed to relieve the Property from common benefit assessments levied against it and similarly situated properties by the City pursuant to and in accordance with any statutory procedure for the assessment of property to pay for infrastructure and/or services which benefit the Property. 13. Indemnity. Owner agrees to indemnify, defend (with counsel approved by City which approval shall not be unreasonably withheld but in no event shall this section require the City to waive its right to assert a conflict in said representation) and hold harmless City, and its elected and appointed councils, boards, commissions, officers, agents, employees, and representatives from any and all claims, costs (including legal fees and costs) and liability for any personal injury or property damage which may arise directly or indirectly as a result of any actions or inactions by the Owner, or any actions or inactions of Owner's contractors, subcontractors, agents, or employees in connection with the construction, improvement, operation, or maintenance of the Project, provided that Owner shall have no indemnification obligation with respect to gross negligence or willful misconduct of City, its contractors, subcontractors, agents or employees or with respect to the maintenance, use or condition of any improvement after the time it has been dedicated to and accepted by the City or another public entity (except as provided in an improvement agreement or maintenance bond). 14. Interes;s of Other Owners Owner has no knowledge of any reason why Owner, and any other persons holding legal or equitable interests in the Property as of the date on which title to the Property vests of record in Owner, will not be bound by this Agreement. 15. Assignment (a) Right to Assign. Owner may at any time or from time to time {ransfer its fight, title or interest in or to all or any portion of the Property. In accordance with Government Code Section 65868.5, the burdens of this Agreement shall be binding upon, and the benefits of this Agreement shall inure to, all successors in interest to Owner. As a condition precedent to any such transfer, Owner shall require the transferee to acknowledge in writing that transferee has been informed, understands and agrees that the burdens and benefits under this Agreement relating to such transferred property shall be binding upon and inure to the benefit of the transferee. (b) Notice of Assignment or Transfer. No transfer, sale or assignment of Owner's rights, interests and obligations hereunder shall occur without the prior written Page 9 of 21 Britannia East Grand Development Agreement May 8, 2002 notice to City and approval by the City Manager, which approval shall not be unreasonably withheld or delayed. The City Manager shall consider and decide the matter within 10 days after Owner's notice, provided all necessary documents, certifications and other information are provided to the City Manager. (c) Exception for Notice. Notwithstanding Section 15(b), Owner may at any time, upon notice to City but without the necessity of any approval by the City, transfer the Property or any part thereof and all or any part of Owner's rights, interests and obligations hereunder to: (i) any subsidiary, affiliate, parent or other entity which controls, is controlled by or is under common control with Owner or Slough Estates USA Inc., (ii) any member or partner of Owner or any subsidiary, parent or affiliate of any such member or partner, or (iii) any successor or successors to Owner by merger, consolidation, non-bankruptcy reorganization or government action. As used in this paragraph, "control" shall mean the possession, directly or indirectly, of the power to direct or cause the direction of management or policies, whether through the ownership of voting securities, partnership interest, contracts (other than those that transfer Owner's interest in the property to a third party not specifically identified in this subsection (c)) or otherwise. (d) Release Upon Transfer. Upon the transfer, sale, or assignment of all of Owner's rights, interests and obligations hereunder pursuant to Section 15 (a), Section 15(b) and Section 15(c) of this Agreement, Owner shall be released from the obligations under this Agreement, with respect to the Property transferred, sold, or assigned, arising subsequent to the date of City Manager approval of such transfer, sale, or assignment or the effective date of such transfer, sale or assignment, whichever occurs later; provided, however, that if any transferee, purchaser or assignee approved by the City Manager expressly assumes any right, interest or obligation of Owner under this Agreement, Owner shall be released with respect to such rights, interests and assumed obligations. In any event, the transferee, purchaser or assignee shall be subject to all the provisions hereof and shall provide all necessary documents, certifications and other necessary information prior to City Manager approval. (e) Owner's Right to Retain Specified Rights or Obligations. Notwithstanding subparagraphs 15 (a) and (c), Owner may withhold from a sale, transfer or assignment of this Agreement certain rights, interests and/or obligations which Owner shall retain, provided that Owner specifies such rights, interests and/or obligations in a written document to be appended to or maintained with this Agreement and recorded with the San Mateo County Recorder prior to or concurrently with the sale, transfer or assignment of the Property. Owner's purchaser, transferee or assignee shall then have no interest or obligations for such retained rights, interests and obligations and this Agreement shall remain applicable to Owner with respect to such retained rights, interests and/or obligations. Page 10 of 21 Britannia East Grand Development Agreement May 8, 2002 (0 Time for Notice. Within 10 days of the date escrow closes on any such transfer, Owner shall notify the City in writing of the name and address of the transferee. Said notice shall include a statement as to the obligations, including any mitigation measures, fees, improvements or other conditions of approval, assumed by the transferee. Any transfer which does not comply with the notice requirements of this section and Section 15 (b) shall not release the Owner from its obligations to the City under this Agreement until such time as the City is. provided notice in accordance with Section 15 (b). 16. I~surLnce. (a) Public Liability and Property Damage Insurance. During the term of thiis Agreement, Owner shall maintain in effect a policy of comprehensive general liability insurance with a per-occurrence combined single limit of not less than ten million dollars ($10,000,000.00) and a deductible of not more than ten thousand dollars ($10,000.00) per claim. The policy so maintained by Owner shall name the City as an additional insured and shall include either a severability of interest clause or cross-liability endorsement. Workers Compensation Insurance. During the term of this Agreement Owner shall maintain Worker's Compensation insurance for all persons employed by Owner for work at the Project site. Owner shall require each contractor and subcontractor similarly to provide Worker's Compensation insurance for its respective employees. Owner agrees to indemnify the City for any damage resulting from Owner's failure to maintain any such required insurance. (c) Evidence of Insurance. Prior to City Council approval of this Agreement, Owner shall furnish City satisfactory evidence of the insurance required in Sections (a) and (b) and evidence that the carrier will endeavor to give the City at least ten days prior written notice of any cancellation or reduction in coverage of a policy if the reduction results in coverage less than that required by this Agreement. In the event of a reduction (below the limits required in this Agreement) or cancellation in coverage, or change in insurance carriers or policies, Owner shall, prior to such reduction, cancellation or change, provide at least ten (10) days prior written notice to City, regardless of any notification by the applicable insurer. If the City discovers that the policies have been cancelled or reduced below the limits required in this Agreement and no notice has been provided by either insurer or Owner, said failure shall constitute a material breach of this Agreement. In the event of a reduction (below the limits required by this Agreement) or cancellation in coverage, Owner shall have five (5) days in which to provide evidence of the required coverage during which time no persons shall enter the Property to construct improvements thereon, including Page 11 of 21 Britannia East Grand Development Agreement May 8, 2002 construction activities related to the landscaping and common improvements. Additionally, no persons not employed by existing tenants shall enter the Property to perform such works until such time as the City receives evidence of substitute coverage. If Owner fails to obtain substitute coverage within five (5) days, City may obtain, but is not required to obtain, substitute coverage and charge Owner the cost of such coverage plus an administrative fee equal to ten percent of the premium for said coverage. (d) The insurance shall include the City, its elective and appointive boards, commissions, officers, agents, employees and representatives as additional insureds on the policy. 17. Covenants Run With The Land The terms of this Agreement are legislative in nature, and apply to the Property as regulatory ordinances. During the term of this Agreement, all of the provisions, agreements, rights, powers, standards, terms, covenants and obligations contained in this Agreement shall mn with the land and shall be binding upon the Parties and their respective heirs, successors (by merger, consolidation or otherwise) and assigns, devisees, administrators, representatives, lessees and all other persons or entities acqu'.ring the Property, any lot, parcel or any portion thereof, and any interest therein, whether by sale, operation of law or other manner, and they shall inure to the benefit of the Parties and their respective successors. 18. Con:'lict with State or Federal Law In the event that State or Federal laws or regulations, enacted after the Effective Date, prevent or preclude compliance with one or more provisions of this Agreement, such provisions of this Agreement shall be modified (in accordance with Section 19 set forth below) or suspended as may be necessary to comply with such State or Federal laws or regulations. Notwithstanding the foregoing, Owner shall have the right to challenge, at its sole cost, in a court of competent jurisdiction, the law or regulation preventing compliance with the terms of this Agreement and, if the challenge in a c6urt of competent jurisdiction is successful, this Agreement shall remain unmodified and in full force and effect. 19. Procedure for Modification Because of Conflict with State or Federal Laws. In the event that state or federal laws or regulations enacted after the effective date of this' Agreement prevent or preclude compliance with one or more provisions of this i Agreement or require changes in plans, maps or permits approved by the City, the parties shall meet and confer in good faith in a reasonable attempt to modify this Agreement to con.ply with such federal or state law or regulation. Any such amendment or suspension Page 12 of 21 Britannia East Grand Development Agreement May 8, 200: 21. 22. 23. of the Agreement shall be approved by the City Council in accordance with Chapter 19.60. Periodic Review During the term of this Agreement, the City shall conduct "annual" and/or "special" reviews of Owner's good faith compliance with the terms and conditions of this Agreement in accordance with the procedures set forth in Chapter 19.60 of the South San Francisco Municipal Code. City may recover reasonable costs incurred in conducting said review, including staff time expended and attorney's fees. Ame'adment or Cancellation of Agreement This Agreement may be further amended or terminated only in writing and in the manner set forth in Government Code Sections 65865.1, 65867.5, 65868, 65868.5 and Chapter 19.6£ of the South San Francisco Municipal Code. Agreement is Entire Am'cement. This Agreement and all exhibits attached hereto or inCorporated herein contain the sole and entire Agreement between the parties concerning the Property. The parties acknowledge and agree that neither of them has made any representation with respect to the sabject matter of this Agreement or any representations inducing the execution and delivery hereof, except representations set forth herein, and each party acknowledges that it has relied on its own judgment in entering this Agreement. The parties further acknowledge that all statements or representations that heretofore may have been made by either of them to the other are void and of no effect, and that neither of them has relied thereon in its dealings with the other. Everls of Default Owner shall be in default under this Agreement upon the happening of one or more of the following events: (a) If a warranty, representation or statement made or furnished by Owner to the City is false or proves to have been false in any material respect when it was made; or A finding and determination by the City made following an annual or special review under the procedure provided for in Government Code Section 65865.1 and Chapter 19.60 of the South San Francisco Municipal Code that, upon the basis of substantial evidence, Owner has not complied in good faith with the terms and conditions of this Agreement; or, (c) Owner fails to fulfill any of its obligations set forth in this Agreement and such failure continues beyond any applicable cure period provided in this Agreement. Page 13 of 21 Britannia East Grand Development Agreement May 8, 2002 24. ' 25. This provision shall not be interpreted to create a cure period for any event of default where such cure period is not specifically provided for in this Agreement. Procedure upon Default (a) Upon the occurrence of an event of default, City may terminate or modify this Agreement in accordance with the provisions of Government Code Section 65865.1 and of Chapter 19.60 of the South San Francisco Municipal Code. (b) The City shall not be deemed to have waived any claim of defect in Owner's performance if, on annual or special review, the City does not propose to terminate this Agreement. (c) No waiver or failure by the City or Owner to enforce any provision of this Agreement shall be deemed to be a waiver of any provision of this Agreement or of any subsequent breach of the same or any other provision. (d) Any actions for breach of this Agreement shall be decided in a court of competent jurisdiction located in San Marco County, California. The remedy for breach of this Agreement shall be limited to specific performance. By entering into this Agreement, Owner hereby waives any fight to a jury trial for breach of this Agreement. (e) The City shall give Owner written notice of any default under this Agreement, and Owner shall have thirty (30) days after the date of the notice to cure the default or to reasonably commence the procedures or actions needed to cure the default. Attorneys fees and costs If legal action by either Party is brought because of breach of this Agreement or to enfo~x:e a provision of this Agreement, the prevailing Party is entitled to reasonable attorney's fees and court costs. (a) Action by Third Party. If any person or entity not a party to this Agreement initiates an action at law or in equity to challenge the validity of any provision of this Agreement or the Project Approvals, the parties shall cooperate in defending such action. Owner shall bear its own costs of defense as a real party in interest in any such action, and shall reimburse City for all reasonable court costs and attorneys' fees expended by City in defense of any such action or other proceeding. Page 14 of 21 Britannia East Grand Development Agreement May 8, 2002 26. Severability 27. 28. 29. 30. 31. If any term or condition of this Agreement is for any reason held by a final judgment of a court of competent jurisdiction to be invalid, and if the same constitutes a material change in the consideration for this Agreement, then this entire Agreement shall likewise be invalid, and shall be deemed null and void and of no further force or effect following such j ~dici al determination. No Third Parties Benefited No person other than the City, Owner, or their respective successors is intended to or shall have any right or claim under this Agreement, this Agreement being for the sole benef.t and protection of the parties hereto and their respective successors. Similarly, no amendment or waiver of any provision of this Agreement shall require the consent or acknGwledgment of any person not a Party or successor to this Agreement. Binding Effect of Agreement The provisions of this Agreement shall bind and inure to the benefit of the Parties origir_ally named herein and their respective successors and assigns. Relationship of Parties It is understood that this Agreement is a contract that has been negotiated and voluntarily entered into by City and Owner and that the Owner is not an agent of City. The parties do not intend to create a partnership, joint venture or any other joint business relationship by th"s Agreement. The City and Owner hereby renounce the existence of any form of joint venture or partnership between them, and agree that nothing contained herein or in any ¢ocument executed in connection herewith shall be construed as making the City and Owner joint venturers or partners. Neither Owner nor any of Owner's agents or contractors are or shall be considered to be agents of City in connection with the performance of Owner's obligations under this Agreement. Bankrup-.cy The obligations of this Agreement shall not be dischargeable in bankruptcy. Mortgagee Protection: Certain Rights of Cure (a) Mortgagee Protection. This Agreement shall be superior and senior to all liens placed upon the Property or any portion thereof after the date on which this Agreement or a memorandum of this Agreement is recorded, including the lien of any deed of trust or mortgage ("Mortgage"). Notwithstanding the foregoing, no breach hereof shall defeat, render invalid, diminish or impair the lien of any Mortgage made in good faith and for value, but all of the terms and conditions contained in this Agreement shall be binding upon and effective against all Page 15 of 21 Britannia East Grand Development Agreement May 8, 2002 32. persons and entities, including all deed of trust beneficiaries or mortgagees ("Mortgagees") who acquire title to the Property or any portion thereof by foreclosure, tmstee's sale, deed in lieu of foreclosure or otherwise. (b) Mortgagee Not Obligated. No foreclosing Mortgagee shall have any obligation or duty under this Agreement to construct or complete the construction of any improvements required by this Agreement, or to pay for or guarantee construction or completion thereof. City, upon receipt of a written request therefor from a /ore, closing Mortgagee, shall permit the Mortgagee to succeed to the rights and obligations of Owner under this Agreement, provided that all defaults by Owner hereunder that are reasonably susceptible of being cured are cured by the Mortgagee as soon as is reasonably possible. The foreclosing Mortgagee -.hereafter shall comply with all of the provisions of this Agreement. (c) Notice of Default to Mortgagee. If City receives notice from a Mortgagee requesting a copy of any notice of default given to Owner hereunder and specifying the address for service thereof, City shall deliver to the Mortgagee :oncurrenfly with service thereof to Owner, all notices given to Owner describing all claims by the City that Owner has defaulted hereunder. If City determines that Dwner is in noncompliance with this Agreement, City also shall serve notice of noncompliance on the Mortgagee, concurrently with service thereof on Owner. Each Mortgagee shall have the right during the same period available to Owner to cure or remedy, or to commence to cure or remedy, the condition of default claimed or the areas of noncompliance set forth in City's notice. Estoppel Certificate. Either party from time to time may deliver written notice to the other party requesting written certification that, to the knowledge of the certifying party (i) this Agreement is in full force and effect and constitutes a binding obligation of the parties; (ii) this Agreement has not been amended or modified either orally or in writing, or, if it has been amended or modified, specifying the nature of the amendments or modifications; and (iii) the requesting party is not in default in the performance of its obligations under this Agreement, or if in default, describing therein the nature and monetary amount, if any, of the default. A party receiving a request hereunder shall endeavor to execute and return the certificate within ten (10) days after receipt thereof, and shall in all events e.xecute and return the certificate within thirty (30) days after receipt thereof. However, a failure to return a certificate within 10 days shall not be deemed a default of the party's obligations under this Agreemen~ and no cause of action shall arise based on the failure of a party to execute such certificate within 10 days. The City Manager shall have the fight to execute the certificates requested by Owner hereunder. City acknowledges that a certificate hereunder may be relied upon by permitted transferees and Mortgagees. At the request of Owner, the certificates provided by City establishing the status of this Agreement with respect to any lot or parcel shall be in recordable form, and Owner shall have the right to record the certificate for the affected portion of the Property at its cost. Page 16 of 21 Britannia East Grand Development Agreement May 8, 2002 33. 34. 35. 36. Force Majeure. Notwithstanding anything to the contrary contained herein, either Party shall be excused for the period of any delay in the performance of any of its obligations hereunder, except the payment of money, when prevented or delayed from so doing by certain causes beyond its control, including, and limited to, major weather differences from the normal weather conditions for the South San Francisco area, war, acts of God or of the public enemy, fires, explosions, floods, earthquakes, invasions by non-United States armed forces, failure of transportation due to no fault of the Parties, unavailability of equipment, supplies, materials or labor when such unavailability occurs despite the applicable Party's good faith efforts to obtain same (good faith includes the present and actual ability to pay market rates for said equipment, materials, supplies and labor), strikes of employees other than Owner's, freight embargoes, sabotage, riots, acts of terrorism and acts of the government (other than the City). The Party claiming such extension of time to perform shall send written notice of the claimed extension to the Other Party within thirty (30) days from the commencement of the cause entitling the Party to the extension. Rules of Construction and Miscellaneous Terms (a) The singular includes the plural; the masculine gender includes the feminine; "shall" is mandatory, "may" is permissive. (b) Time is and shall be of the essence in this Agreement. (c) Where a Party consists of more than one person, each such person shall be jointly and severally liable for the performance of such Party's obligation hereunder. (d) The captions in this Agreement are for convenience only, are not a part of this Agreement and do not in any way limit or amplify the provisions thereof. (e) This Agreement shall be interpreted and enforced in accordance with the laws of the State of California in effect on the date thereof. Exhibits Exhibit A - Map and Legal Description of Property Exhibit B - Planned Unit Development Permit, including Plan Set and Conditions of Project Approval Exhibit C - Obligations of Owner and City Exhibit D - Form Irrevocable Letter of Credit Notices All aotices required or provided for under this Agreement shall be in writing and delivered in person (to include delivery by courier) or sent by certified mail, postage Page 17 of 21 Britannia East Grand Development Agreement May 8, 2002 prepa:~d, return receipt requested or by overnight delivery service. Notices to the City shall be addressed as follow: City Clerk P.O. Box 711,400 Grand Avenue South San Francisco, CA 94083 Notices to Owner shall be addressed as follows: Slough SSF, LLC c/o Slough Estates USA Inc. 33 West Monroe Street, Suite 2000 Chicago, IL 60603 Attention: William Rogalla A par;y may change its address for notice by giving notice in writing to the other party and It ereafter notices shall be addressed and transmitted to the new address. Page 18 of 21 Britannia Eas~. Grand Development Agreement May 8, 2002 IN WITleSs-SS WHEREOF this Agreement has been executed by the parties on the day and year first ~.bove written. CITY OF SOUTH SAN FRANCISCO ATTEST: By: Michael A. Wilson, City Manager City Clerk APPROVED AS TO FORM Steven T. Mattas, City Attorney OWNER Slough SSF, LLC, a Delaware limited liability company By: Slough Estates USA Inc., a Delaware corporation, Its Manager By: Name: Title: APPROVED AS TO FORM: Donald E. Kelley, Jr. Folger Levin & Kahn LLP Counsel for Owner Page 19 of 21 Britannia East Grand Development Agreement May 8, 2002 EXHIBIT B PROPERTY DESCRIPTION All that certain real property in the City of South San Francisco, County of San Mateo, State of Califo_mia, more particularly described as follows: PARCEL I: A portion of the lands of W.P. Fuller and Company shown on the Record of Survey located in Volume 6 of L.L.S. Maps at page 117 in the Records of said County, described as follows: Beginning at the Southwesterly comer of the 18.5695 acre parcel shown on said Map; thence through the fo¢lowing numbered courses: North 00° 14' 37" West along the Westerly line of said Parcel 408.03 feet to the Southerly line of :he Southern Pacific Company Right-of-Way shown as East Grand Avenue (60 feet wi :le) on said Map and a point on a non-tangent curve to the left from which the radius ,~oint lies North 39° 14' 21" West 413.10 feet. Easterly along said curve through a central angle of 01° 38' 21" an arc distance of 11.82 feet. 3. North 49° 07' 18" East tangent to said curve 140.89 feet. 4. South 86° 44' 41" East 672.34 feet. 5. South ~}3° 10' 20" West 515.30 feet to the Southerly line of said 18.5695 acre parcel. 6. North 86° 44' 37" West along said Southerly line 551.30 feet. 7. North 86° 14' 41" West along said Southerly line 206.61 feet to the point of beginning. Said lands are described as Parcel "A" in that certain Lot Line Adjustment recorded March 25, 1996 as Document No. 96035012. APN: 015-102~270. PARCEL II: A portion of the lands of W.P. Fuller and Company shown on the Record of. Survey recorded in Volume 6 of L.L.S. Maps at Page 117 in the records of said county, described as follows: BEGINNING at the intersection of the Westerly line of the 18.5695 acre parcel shown on said map with the Southerly line of the Southern Pacific Co. Right-of-Way shown as East Grand Page 20 of 21 Britannia Eas~ Grand Development Agreement May 8, 2002 Avenue (60 fee: wide) on said map and a point on a non-tangent curve to the left from which the radius point lies North 39° 14' 21" West 413.10 feet; thence through the following numbered courses: 3. 4. 5. Easterly along said curve through a central angle of 01° 38' 21" an arc distance of 11.82 feet. North 49° 07' 18" East tangent to said curve 140.89 feet. South 86° 44' 41" East 672..34 feet. South 03° 10' 20" West 515.30 feet to the Southerly line of said 18.5695 acre parcel. South 86° 44' 37" East along said Southerly line 435.13 feet to the Easterly line of the lands skown on said map. North 03° 15' 23" East along said Easterly line 865.45 feet. North 03° 28' 53" East along said Easterly line 100.00 feet to the Northerly line of the lands sl'_own on said map. North 86° 44' 37" West along said Northerly line 1252.36 feet to the Westerly line of the 6.6796 acre parcel shown on said map. South CO° 14' 37" East along said Westerly line and its Southerly extension 557.42 feet to the poir.t of beginning. EXCEPTING TltE~OM the portions deeded to the City of South San Francisco and accepted by the Resolution recorded in Reel 7756 at Image 418 in the Official Records of said County. Said lands being described as Parcel "B" in that certain Lot Line Adjustment recorded March 25, 1996, as Document No. 96035012. APN: 015-101-090 and 015-102-280. Britannia East Grand Development Agreement Page 21 of 21 May 8, 2002 Exhibit C Britannia East Grand Development Agreement Owner Obligations Chi'd Care Center. As part of the Project, Owner has agreed to construct an app:oximately eight thousand (8,000) square foot child care center ("Center"). The Center is intended to be on-site and to serve the tenants of the Project. However, due to various environmental issues affecting the site, Owner may not receive env:_ronmental clearance for an on-site center from the California Department of Toxic Substances Control ("DTSC") and/or from other governmental authorities hav:_ng jurisdiction over environmental conditions at the site. Therefore, the Parties have agreed to the following terms in order to ensure the child care needs of the City are :.'net. Ao Owner shall diligently pursue, to the extent necessary to permit construction of the Center on-site, the removal of the current deed restriction as imposed by DTSC, the removal of any other restrictions imposed by any other governmental authorities having jurisdiction over environmental conditions at the site, and the receipt of any other necessary waivers, approvals, consents and permits from DTSC and any governmental authorities having jurisdiction over environmental conditions at the site (collectively, "Environmental Clearances"). Bo By December 31, 2003, Owner shall notify the City in writing, with appropriate supporting documentation, either (i) that the Environmental Clearances necessary to permit construction of the Center on-site have been obtained or, in the alternative, that the applicable governmental authorities have agreed in writing to issue the Environmental Clearances, or (ii) that Owner has been unable to obtain issuance of or commitments to issue all such necessary Environmental Clearances. On-Site Location: If Owner receives the necessary Environmental Clearances to construct the Center on-site, Owner shall obtain all required permits, including building permits and commence construction of the facility no later than December 31, 2005, and Owner shall complete construction and receive a Certificate of Occupancy for the facility no later than December 31, 2007. (2) Off-Site Location: If Owner is unable to obtain issuance of or commitments to issue all necessary Environmental Clearances by December 31, 2003, or obtains such clearance but fails to submit an application for a building permit for the Center on or before December 31, 2005, Owner shall instead: Exhibit C - Britannia Development Agreement Page 1 of 5 May 8, 2002 Complete construction of an approximately 8,000 square foot childcare facility at an off-site location approved by the City, which approval shall not be unreasonably withheld or delayed, by no later than December 31, 2007. Owner shall have acquired a site for the construction of said facility by June 30, 2006. In the event Owner must build the facility off-site, potentially acceptable off-site locations include: (1) the East of 101 Plan Area, as defined in the General Plan, adopted October 1999; or (2) in a Regional Transit Facility located in the City of South San Francisco. Owner shall pay all costs associated with the acquisition of a site suitable for the Center, environmental review, permitting and all other costs and fees, including attorney's fees, incurred as a result of acquiring the property, if necessary, 'through the City's power of eminent domain and all costs of constructing the facility and required improvements, if any. Co If Owner is unable to acquire a site that is acceptable to the City as set forth above by June 30, 2006, that is of reasonably sufficient size to construct the off-site facility, Owner shall instead pay a fee equal to the City's estimated reasonable costs to construct an equivalent facility, including all costs associated with the acquisition of a site suitable for the Center, environmental review, permitting and all other costs and fees, including attorney's fees, incurred as a result of acquiring the property, if necessary, through the City's power of eminent domain and building the Center. Widening Northbound Off-ramp and On-Ramp Approach at South Airport Mitigation Measure: In addition to the East of 101 Traffic Impact Mitigation Fee applicable to the Project under the existing provisions governing the fee (currently $1.51 per gross square foot~, Owner shall pay its fair share contribution to the widening of South Airport Bou'_evard/U.S. 101 Northbound ramps as required in the Britannia East Grand Final Env:'ronmental Impact Report. The total cost of said improvement is estimated to be One Mill'.on Three Hundred Sixty Four Thousand Dollars, including all costs of construction, including but not limited to design costs, consultant fees, bid preparation and administrative costs. Owner's contribution shall be paid at the rate of forty cents ($.40) per gross square foot upon issuance of each building permit for any structure in the Proj :ct, excluding the parking structures. Thus, Owner shall pay One Dollar and Ninety- One Cents ($1.91) per gross square foot upon issuance of a building permit for any structure in the Project, excluding the parking structures. A. Payment of East of 101 Traffic Mitigation Fee: Owner acknowledges that the City is presently considering an amendment to the East of 101 Traffic Impact _Mitigation Fee to address the Grand AvenueFLl. S. 101 northbound ramp and the South Airport Boulevard/U.S. 101 ramp system which were not identified as required Exhibit C - Britannia Development Agreement Page 2 of 5 May 8, 2002 irrprovements in the original Fee Study adopted by the South San Francisco City Council on September 26, 2001 (Resolution No. 99-2001). (1) If the South Airport Mitigation Measure is included as a project in the East of 101 Fee, and the resultant fee ("Amended Fee") is less than $1.91 per gross square foot, Owner shall be reimbursed based on each building permit obtained prior to adoption of the Amended Fee in an amount equal to the difference between the fee paid and the fee that would have been paid under the Amended Fee. Any such overpayment shall be refunded within sixty (60) days of Owner's first receiving a building permit based on the Amended Fee or, if Owner does not receive any such building permit within sixty (60) days after adoption of the Amended Fee, then the overpayment shall be refunded within thirty (30) days of receiving Owner's written re:luest for reimbursement. (2) Owner shall thereafter pay the East of 101 Traffic Mitigation Fee as specified in existing and subsequent Resolutions of the City Council upon issuance of each subsequent building permit for buildings within the Project, but in no event shall such fee exceed $1.91 per gross square foot. (3) If City has not adopted an Amended Fee by the expiration date of this Agreement, Owner shall not be liable for an Amended Fee that exceeds $1.91 per gross square foot for any building permits obtained during the term of this Agreement. Likewise, if an Amended Fee is adopted after the termination date of this Agreement and said fee is less than $1.91 per gross square foot, Owner shall not be entitled to reimbursement for any overpayment of fee paid during the term of this Agreement. P'ablic Art Contribution: Owner shall install and provide artwork for public display ir the Project. Said art project shall cost no less than three hundred thousand dollars (S300,000), which shall be installed on the Project site as follows: 1) artwork in the amount of at least One Hundred Fifty Thousand Dollars ($150,000) shall be installed within three years of the Effective Date of this Agreement; and 2) if less than $300,000 of artwork has been installed within three years of the Effective Date, the remaining amount shall be installed within five years of the Effective' Date. The a_-twork to be installed by the Owner shall be subject to the reasonable approval of the City of South San Francisco prior to installation. Artworks installed pursuant to this section shall be maintained by Owner or, in the event Owner's interest in the property is conveyed or subdivided, by Owner's successors, or, if applicable, by the Owner's Association for the Project. If an association of owners is created, said maintenance obligations and a budget related thereto shall be included in the Covenants, Conditions and Restrictions for the Project. Transportation Demand Management: Owner shall prepare an annual Transportation Demand Management (TDM) report, and submit same to City, to document the effectiveness of the TDM plan in achieving the goal of 30% alternative mode usage by employees within the Project. The TDM report will be prepared by an Exhibit C - Britannia Development Agreement Page 3 of 5 May 8, 2002 independent consultant, retained by City with the approval of Owner (which approval shall not be unreasonably withheld or delayed) and paid for by Owner, which consultant will work in concert with Owner's TDM coordinator. The TDM report w"ll include a determination of historical employee commute methods, which information shall be obtained by survey of all employees working in the buildings on the Property. All non-responses to the employee commute survey will be counted as a drive alone trip. TDM Reports: The initial TDM report for each building on the Property will be submitted two (2) years after the granting of a certificate of occupancy with respect to the building, and this requirement will apply to all buildings on the Property except the parking facilities. The second and all later reports with respect to each building shall be included in an annual comprehensive TDM report submitted to City covering all of the buildings on the Property which are submitting their second or later TDM reports. Report Requirements: The goal of the TDM program is to encourage alternative mode usage, as defined in Chapter 20.120 of the South San Francisco Municipal Code. The initial TDM report shall either: (1) state that the applicable property has achieved 30% alternative mode usage, providing supporting statistics and analysis to establish attainment of the goal; or (2) state that the applicable property has not achieved the 30% alternative mode usage, providing an explanation of how and why the goal has not been reached, and a description of additional measures that will be adopted in the coming year to attain the TDM goal of 30% alternative mode usage. Ce Penalty for Non-Compliance: If after the initial TDM report, subsequent annual reports indicate that, in spite of the changes in the TDM plan, the 30% alternative mode usage is still not being achieved, or if Owner fails to submit such a TDM report at the times described above, City may assess Owner a penalty in the amount of Fifteen Thousand Dollars ($15,000.00) per year for each percentage point below the minimum 30% alternative mode usage goal. (1) In determining whether a financial penalty is appropriate, City may consider whether Owner has made a good faith effort to meet the TDM goals. (2) If City determines that Owner has made a good faith effort to meet the TDM goals but a penalty is still imposed, and such penalty is imposed within the first three (3) years of the TDM plan (commencing with the first year in which a penalty could be imposed), such penalty sums, in the City's sole discretion, may be used by Owner toward the implementation of the TDM plan instead of being paid to City. If the penalty is used to implement the TDM Plan, an Implementation Plan shall be reviewed and approved by the City prior to expending any penalty funds. Exhibit C - Britannia Development Agreement Page 4 of 5 May 8, 2002 (3) Notwithstanding the foregoing, the amount of any penalty shall bear the same relationship to the maximum penalty as the completed construction to which the penalty applies bears to the maximum amount of square feet of Office, Commercial, Retail and Research and Development use permitted to be constructed on the Property. For example, if there is 200,000 square feet of completed construction on the Property included within the TDM report with respect to which the penalty is imposed, the penalty would be determined by multiplying Fifteen Thousand Dollars ($15,000.00) times a fraction, the numerator of which is 200,000 square feet and the denominator of which is the maximum amount of square feet of construction permitted on the Property, subtracting the square footage of the parking facilities; this amount would then be multiplied by the number of percentage points below the 30% alternative mode usage goal. (4) The provisions of this section are incorporated as Conditions of Approval for the Project and shall be included in the approved TDM for the Project. Exhibit c - Britannia Development Agreement Page 5 of 5 May 8, 2002 ?""EXHIBIT B PROPERTY DESCRI~ION All th~.t certain real property in the City of South San Francisco, County of San Mateo, State of California, more particularly described as follows: PARCEL I: A portion of the lands of W.P. Fuller and Company shown on the Record of Survey located in Volume 6 of L.L.S. Maps at page 117 in the Records of said County, described as follows: Beginning at the Southwesterly comer of the 18.5695 acre parcel shown on said Map; thence through the fcllowing numbered courses: North 00° 14' 37" West along the Westerly line of said Parcel 408.03 feet to the Southerly line of the Southern Pacific Company Right-of-Way shown as East Grand Avenue (60 feet wide) on said Map and a point on a non-tangent curve to the left from which the radius point lies North 39° 14' 21" West 413.10 feet. Easter'_y along said curve through a central angle of 01° 38' 21" an arc distance of 11.82 feet. 3. North 49° 07' 18" East tangent to said curve 140.89 feet. 4. South 86° 44' 41" East 672.34 feet. 5. South 03° 10' 20" West 515.30 feet to the Southerly line of said 18.5695 acre parcel. 6. North 86° 44' 37" West along said Southerly line 551.30 feet. 7. North 86° 14' 41" West along said Southerly line 206.61 feet to the point of beginning. Said lands are described as Parcel "A" in that certain Lot Line Adjustment recorded March 25, 1996 as Doccment No. 96035012. APN: 015-102-270. PARCEL II: A portion of :he lands of W.P. Fuller and Company shown on the Record of Survey recorded in Volume 6 of L.L.S. Maps at Page 117 in the records of said county, described as follows: BEGINNING at the intersection of the Westerly line of the 18.5695 acre parcel shown on said map with the Southerly line of the Southern Pacific Co. Right-of-Way shown as East Grand Avenue (60 feet wide) on said map and a point on a non-tangent curve to the left from which the radius point lies North 39° 14' 2t" West 413.10 feet; thence through the following numbered courses: 18 Easterly along said curve through a central angle of 01° 38' 21" an arc distance of 11.82 feet. 2. North 49° 07' 18" East tangent to said curve 140.89 feet. 3. South 86° 44' 41" East 672.34 feet. 4. South 03° 10' 20" West 515.30 feet to the Southerly line of said 18.5695 acre parcel. South 86° 44' 37" East along said Southerly line 435.13 feet to the Easterly line of the lands shown on said map. 6. North £3° 15' 23" East along said Easterly line 865.45 feet. North £3° 28' 53" East along said Easterly line 100.00 feet to the Northerly line of the lands shown on said map. North 86° 44' 37" West along said Northerly line 1252.36 feet to the Westerly line of the 6.6796 acre parcel shown on said map. South CO° 14' 37" East along said Westerly line and its Southerly extension 557.42 feet to the point of beginning. EXCEPTING THEREFROM the portions deeded to the City of South San Francisco and accepted by the Resolution recorded in Reel 7756 at Image 418 in the Official Records of said County. Said lands being described as Parcel "B" in that certain Lot Line Adjustment recorded March 25, 1996, as Document No. 96035012. APN: 015-101-090 and 015-102-280. 19 Exhibit C Britannia East Grand Development Agreement Owner Obligations Child Care Center. As part of the Project, Owner has agreed to construct an approximately eight thousand (8,000) square foot child care center ("Center"). The Center is intended to be on-site and to serve the tenants of the Project. However, due to various environmental issues affecting the site, Owner may not receive environmental clearance for an on-site center from the California Department of Toxic Substances Control ("DTSC") and/or from other governmental authorities having jurisdiction over environmental conditions at the site. Therefore, the Parties have agreed to the following terms in order to ensure the child care needs of the City are met. Ao Owner shall diligently pursue, to the extent necessary to permit construction of the Center on-site, the removal of the current deed restriction as imposed by DTSC, the removal of any other restrictions imposed by any other governmental authorities having jurisdiction over environmental conditions at the site, and the receipt of any other necessary waivers, approvals, consents and permits from DTSC and any governmental, authorities having jurisdiction over environmental conditions at the site (collectively, "Environmental Clearances"). Bo By December 31, 2003, Owner shall notify the City in writing, with appropriate supporting documentation, either (i) that the Environmental Clearances necessary to permit construction of the Center on-site have been obtained or, in the alternative, that the applicable governmental authorities have agreed in writing to issue the Environmental Clearances, or (ii) that Owner has been unable to obtain issuance of or commitments to issue all such necessary Environmental Clearances. (1) On-Site Location: If Owner receives the necessary Environmental Clearances to construct the Center on-site, Owner shall obtain all required permits, including building permits and commence construction of the facility no later than December 31, 2005, and Owner shall complete construction and receive a Certificate of Occupancy for the facility no later than December 31, 2007. (2) Off-Site Location: If Owner is unable to obtain issuance of or commitments to issue all necessary Environmental Clearances by December 31, 2003, or obtains such clearance but fails to submit an application for a building permit for the Center on or before December 31, 2005, Owner shall instead: Exhibit C - Britannia Development Agreement April 19,2002 Page 1 of 5 Ao Complete construction of an approximately 8,000 square foot childcare facility at an off-site location approved by the City, which approval shall not be unreasonably withheld or delayed, by no later than December 31, 2007. Owner shall have acquired a site for the construction of said facility by June 30, 2006. Bo In the event Owner must build the facility off-site, potentially acceptable off-site locations include: (1) the East of 101 Plan Area, as defined in the General Plan, adopted October 1999; or (2) in a Regional Transit Facility located in the City of South San Francisco. Owner shall pay all costs associated with the acquisition of a site suitable for the Center, environmental review, permitting and all other costs and fees, including attorney's fees, incurred as a result of acquiring the property, if necessary, through the City's power of eminent domain and all costs of constructing the facility and required improvements, if any. Co If Owner is unable to acquire a site that is acceptable to the City as set forth above by June 30, 2006, that is of reasonably sufficient size to construct the off-site facility, Owner shall instead pay a fee equal to the City's estimated reasonable costs to construct an equivalent facility, including all costs associated with the acquisition of a site suitable for the Center, environmental review, permitting and all other costs and fees, including attorney's fees, incurred as a result of acquiring the property, if necessary, through the City' s power of eminent domain and building the Center. WSdening Northbound Off-ramp and On-Ramp Approach at South Airport 1VEtigation Measure: In addition to the East of 101 Traffic Impact Mitigation Fee applicable to the Project under the existing provisions governing the fee (currently $1.51 per gross square foot), Owner shall pay its fair share contribution to the widening of South Airport Boulevard/U.S. 101 Northbound ramps as required in the Britannia East Grand Final Environmental Impact Report. The total cost of said improvement is estimated to be One Million Three Hundred Sixty Four Th ousand Dollars, including all costs of construction, including but not limited to design costs, consultant fees, bid preparation and administrative costs. Owner's contribution shall be paid at the rate of forty cents ($.40) per gross square foot upon issuance of each building permit for any structure in the Project, excluding the parking structures. Thus, Owner shall pay One Dollar and Ninety-One Cents Exhibit C - Britannia Development Agreement Page 2 of 5 April 19,2002 I ($~_.91) per gross square foot upon issuance of a building permit for any structure in the Project, excluding the parking structures. A. Payment of East of 101 Traffic Mitigation Fee: Owner acknowledges that the City is presently considering an amendment to the East of 101 Traffic Impact Mitigation Fee to address the Grand Avenue/U.S. 101 northbound ramp and the South Airport Boulevard/U.S. 101 ramp system which were not identified as required improvements in the original Fee Study adopted by the South San Francisco City Council on September 26, 2001 (Resolution No. 99- 2001). (1) If the South Airport Mitigation Measure is included as a project in the East of 101 Fee, and the resultant fee ("Amended Fee") is less than $1.91 per gross square foot, Owner shall be reimbursed based on each building permit obtained prior to adoption of the Amended Fee in an amount equal to the difference between the fee paid and the fee that would have been paid under the Amended Fee. Any such overpayment shall be refunded within sixty (60) days t,cr~x~....~ of Owner's first receiving a building permit based on the Amended Fee or. if Owner does not receive any such building r~ermit within sixty (60) days after adontion of the Amended Fee, then the overvavment shall be refunded within thirtv (30) days of receiving agt~ Owner's written reauest for reimbursement. (2) Owner shall thereafter pay the East of 101 Traffic Mitigation Fee as specified in existing and subsequent Resolutions of the City Council upon issuance of each subseauent building, permit for buildings within the Project. but in no event shall such fee exceed $1.91 per gross square foot. (3)- If City has not adopted an Amended Fee by the expiration date of this Agreement, Owner shall not be liable for an Amended Fee that exceeds $1.91 per gross square foot for any building permits obtained during the term of this Agreement. Likewise, if an Amended Fee is adopted after the termination date of this Agreement and said fee is less than $1.91 per gross square foot, Owner shall not be entitled to reimbursement for any overpayment of fee paid during the term of this Agreement. Public Art Contribution: Owner shall install and provide artwork for public display in the Project. Said art project shall cost no less than three hundred thousan, d dollars ($300,000), which shall be installed on the Project site as follows: 1) artwork in the amount of at least One Hundred Fifty Thousand Dollars ($150,000) shall be installed within three years of the Effective Date of this Agreement; and 2) if less than $300,000 of artwork has been installed within three years of the Effective Date, the remaining amount shall be installed within five years of the Effective Date. The artwork to be installed by the Owner shall be subject to the reasonable approval of the City of South San Francisco prior to installation. Artworks installed pursuant to this section Exhibit C - Britannia Development Agreement April 19,2O02 Page 3 of 5 shall be maintained by Owner or, in the event Owner's interest in the property is conveyed or subdivided, by Owner's successors, or, if applicable, by the Owner's Association for the Project. If an association of owners is created, said maintenance obligations and a budget related thereto shall be included in the Covenants, Conditions and Restrictions for the Project. Transportation Demand Management: Owner shall prepare an annual Transportation Demand Management (TDM) report, and submit same to City, to document the effectiveness of the TDM plan in achieving the goal of 30% alternative mode usage by employees within the Project. The TDM report will be prepared by an independent consultant, retained by City with the approval of Owner (which approval shall not be unreasonably withheld or delayed) and paid for by Owner, which consultant will work in concert with Owner's TDM coordinator. The TDM report will include a determination of historical employee commute methods, which information shall be obtained by survey of all employees working in the buildings on the Property. All non- responses to the employee commute survey will be counted as a drive alone trip. Ao TDM Revorts: The initial TDM report for each building on the Property will be submitted two (2) years after the granting of a certificate of occupancy with respect to the building, and this requirement will apply to all buildings on the Property except the parking facilities. The second and all later reports with respect to each building shall be included in an annual comprehensive TDM report submitted to City covering all of the buildings on the Property which are submitting their second or later TDM reports. Bo Report Requirements: The goal of the TDM program is to encourage alternative mode usage, as defined in Chapter 20.120 of the South San Francisco Municipal Code. The initial TDM report shall either: (1) state that the applicable property has achieved 30% alternative mode usage, providing supporting statistics and analysis to establish attainment of the goal; or (2) state that the applicable property has not achieved the 30% alternative mode usage, providing an explanation of how and why the goal has not been reached, and a description of additional measures that will be adopted in the coming year to attain the TDM goal of 30% alternative mode usage. Penalty for Non-Compliance: If after the initial TDM report, subsequent annual reports indicate that, in spite of the changes in the TDM plan, the 30% alternative mode usage is still not being achieved, or if Owner fails to submit such a TDM report at the times described above, City may assess Owner a penalty in the amount of Fifteen Thousand Dollars ($15,000.00) per year for each percentage point below the minimum 30% alternative mode usage goal. Exhibit C - Britannia Development Agreement Page 4 of 5 April 19,2002 I I ; ! :1 I