HomeMy WebLinkAboutR33-Economic Development Agency
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ORIGINAL
CITY OF SAN BERNARDINO
ECONOMIC DEVELOPMENT AGENCY
FROM: Maggie Pacheco
Executive Director
SUBJECT: Verdemont Heights Towne Center -
Redevelopment Project Study and
Exclusive Right to Negotiate Agreement in
the Verdemont Area
DATE:
October 30. 2006
SvnoPSis of Previous Commission/Council/Committee Action(s):
On October 19. 2006, Redevelopment Committee Members Estrada. Johnson and Baxter unanimously voted to
recommend that the Community Development Commission consider this action for approval.
Recommended Motion(sl:
(Communitv DeveloDment Commission)
Resolution of the Community Development Commission of the City of San Bernardino approving and
authorizing the Executive Director of the Redevelopment Agency of the City of San Bernardino ("Agency") to
execute the Redevelopment Project Study and Exclusive Right to Negotiate Agreement with HopRock 2
Verdemont, LLC ("Developer") - Verdemont Area
Contact Person(s):
Maggie Pacheco
(909) 663.1044
5
Phone:
Project Area(s):
Ward(s):
N/A
Supporting Data Attached: I!'I Staff Report I!'I Resolution(s) I!'I Agreement(s)/Contract(s) I!'I Map(s) 0 Letters
FUNDING REQUIREMENTS: Amount: $
Source:
N/A
Budget Authority: N/A
SIGNATURE: taL~CU CJ'~)U'---;-/?
Barbara Lindseth, Admin. S~rvi6es Director
Commission/Council Notes:
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P:\Agendas\Conun Dev Commission\COC 2006\] 1-20-06 HopRock 2 Verdemont SR.doc
COMMISSION MEETING AGENDA
Meeting Date: 11120/2006
Agenda Item Number: ~
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ECONOMIC DEVELOPMENT AGENCY
STAFF REPORT
VERDEMONT HEIGHTS TOWNE CENTER. REDEVELOPMENT PROJECT STUDY AND
EXCLUSIVE RIGHT TO NEGOTIATE AGREEMENT IN THE VERDEMONT AREA
BACKGROUND:
The City of San Bernardino ("City") is the owner of approximately twenty-two (22) acres of public
space in the Verdemont Area known as the "Blast" soccer fields and "Guhin Park" (the "City
Property"). The City Property is improved and zoned for public recreational use and is bounded by
Little League Drive to the north, the 1-215 Freeway ("1-215") to the west, the County Flood Control
Channel to the east and vacant land to the south (the "Developer Property") which vacant land is
owned by HopRock 2 Verdemont, LLC, a Delaware corporation, (the "Developer"). The Developer
Property is approximately thirty-seven (37) acres in size and zoned Commercial General 5 (CG-5) (See
attached Exhibit "A").
Immediately to the north of the City Property, on Little League Drive and the 1-215 is one hundred
(100) acres of Agency owned property (the "Agency Property") formerly known as the Bice property.
(~ee attached Exhibit "B").
CURRENT ISSUE:
The Developer, who is well known to the City and Redevelopment Agency of the City of San
Bernardino (the "Agency") for producing quality developments (this is the same Developer who
developed the HUB Project in the Hospitality Lane area), has approached the Agency with the intent of
undertaking another retail project on the Developer Property which could include a number of
department stores, lifestyle stores, restaurants and a fitness center. Not only would this be of great
benefit to the growing population in the Verdemont Area but would also stem the flow of sales tax
dollars to neighboring centers such as Victoria Gardens in Rancho Cucamonga and Citrus Plaza in
Redlands.
However, in order to undertake a development large enough to attract stores such as Borders Books
and Bed, Bath & Beyond, the Developer needs a site in excess of the thirty-seven (37) acres currently
under their control and is therefore seeking to study both the City Property and the Developer Property
(collectively the "Study Area"). This would result in a fifty-nine (59) acre site, which would be able to
accommodate a Citrus Plaza type of development.
It is therefote proposed that the Agency enter into a Redevelopment Project Study and Exclusive Right
to Negotiate Agreement ("Agreement") with the Developer for the entire Study Area. Should the
Agreement culminate in the successful negotiation and execution of a mutually satisfactory Disposition
and Development Agreement ("DDA") between the Agency and the Developer, the Agency will set
aside thirty (30) acres of Agency Property for the City as a replacement park and soccer complex in
exchange for the twenty-two (22) acres of City Property, which will become part of the DDA between
the Agency and the Developer. (Note: This 3D-acre site was depicted in the DDA between the Agency
and Century Crowell Communities, LP, as approved by the Community Development Commission on
July 24, 2006).
P:\Agendas\Comm Dev Commission\COC 2006\] 1-20-{)6 HopRock 2 Vcrdell'llnl SR.doc
COMMISSION MEETING AGENDA
Meeting Date: 11120/2006
Agenda Item Number: ~
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Economic Development Agency Staff Report
HopRock 2 Verdenumt, LLC - ERN
Page 2
Below are the salient points of the Agreement:
. The Developer will explore the development feasibility of the entire Study Area as a quality
development of approximately 675,000 square feet, to the satisfaction of the City and the
Agency, with an estimated value of not less than $76 million.
. The Developer agrees to pay fair market value for the City Property, which will be conveyed to
the Agency at a later date, as determined by an independent MAl appraiser acceptable to both
parties.
. Upon approval of this Agreement, the Developer will pay the sum of $75,000 to the Agency by
way of a non-refundable deposit, which will be applied against the purchase price, should the
project proceed.
. The Agreement is for a period of twelve (12) months with a further six (6) month Executive
Director extension and another six (6) month Commission extension to give sufficient time for
the necessary zone change, from PP (Public Park) to CO-5, to take place. The Agency will
assist with the California Environmental Quality Act (CEQA) process at the cost of the
Developer.
. The feasibility will include the provision of the replacement park on the Agency Property to the
north as per the notation above referencing the Century Crowell Communities, LP/Agency
DDA and as depicted in Exhibit "B".
. Agency participation in certain offsite public improvements of general benefit to. the
community such as expansion/widening of Little League Drive, traffic signalization, etc. may
be required and negotiated.
. All other project study and third (3rd) party costs are at the sole cost of the Developer.
. Should this retail project cause another retailer of 25,000 square .feet or greater in size to close
elsewhere in San Bernardino within three hundred sixty-five (365) days after opening in the
Study Area, the Developer will make a best effort to locate another tenant to fill that location.
The ultimate goal of this Agreement is the execution of a DDA between the Agency and the
Developer. Approval of a final DDA could take place prior to the Developer having received final
project and entitlements approval for the purposes of CEQA; however, conveyance of the City
Property is contingent upon issuance of all development entitlements and certification of the project
Environmental Impact Report (EIR).
ENVIRONMENTAL IMPACT:
The Study Agreement is categorized as Statutory Exemption under CEQA per Public Resource Code
Sections 21102 and 21150.
P:\Agenda5\Comm Dcv Commission\COC 2006\11-20-06 HopRol:k 2 Vcrdcmonl SR.doc
COMMISSION MEETING AGENDA
Meeting Date: llnOl2OO6
Agenda Item Number: -..Ln
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Economic Development Agency Staff Report
HopRock 2 Verdemont. LLC - ERN
Page 3
FISCAL IMPACT:
None.
RECOMMENDATION:
That the Community Development Commission adopt the attached Resolution.
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COMMISSION MEETING AGENDA
Meeting Date: 1112012006
Agenda Item Number: R.33-
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RESOLUTION NO.
'RESOLUTION OF THE COMMUNITY DEVELOPMENT COMMISSION
OF THE CITY OF SAN BERNARDINO APPROVING AND
AUTHORIZING THE EXECUTIVE DIRECTOR OF THE
REDEVELOPMENT AGENCY OF THE CITY OF SAN BERNARDINO
("AGENCY") TO EXECUTE THE REDEVELOPMENT PROJECT
STUDY AND EXCLUSIVE RIGHT TO NEGOTIATE AGREEMENT
WITH HOPROCK 2 VERDEMONT, LLC ("DEVELOPER")
VERDEMONT AREA
WHEREAS, the City of San Bernardino ("City") owns certain property in the Verdemont
Area (the "Verdemont Area") as generally depicted in Exhibit "A" attached to the Agreement (as
hereinafter defined) consisting of the Guhin Park and certain soccer fields comprised 0
approximately 22 acres ofland (the "City Property"); and
WHEREAS, the City seeks to declare such City Property surplus at a later date to the needs
and requirements of the City and to convey the City Property to the Agency at the appropriate t~me
for further disposition by the Agency; and
WHEREAS, the Agency and the Developer are interested in exploring the development
feasibility of the City Property together with the development of the Developer Property (as
hereinafter defined) so as to foster the community economic development goals and objectives of
the City as it relates to the redevelopment for the Verdemont Area; and
WHEREAS, the Developer owns approximately 37 acres ofland (the "Developer Property")
immediately to the south of the City Property, and the Developer seeks to expand the scope of a
proposed commercial and retail development project to include the development of the City
Property together with the development of the Developer Property; and
WHEREAS, the Developer is qualified to assist the Agency to undertake the development
feasibility for a coordinated and economically sustainable commercial and retail development
project on the City Property and the Developer Property, which will require specific study,
evaluation and planning by the City and the Agency, as applicable, of appropriate and feasible
community development program and financing alternatives; and
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WHEREAS, in accordance with the provisions of the California Environmental Quality Act
("CEQA"), the Redevelopment Project Study and Exclusive Right to Negotiate Agreement (the
"Agreement") in the form as attached to this Resolution as Exhibit "B" and the approval, execution
and delivery thereof is exempt from the provisions of CEQA.
NOW, THEREFORE, THE COMMUNITY DEVELOPMENT COMMISSION OF THE CITY
OF SAN BERNARDINO DOES HEREBY RESOLVE, DETERMINE AND ORDER, AS FOLLOWS:
Section 1.
The Community Development Commission ("Commission") hereby
approves the Agreement by and between the Agency and the Developer in the form as attached
hereto as Exhibit "B" and as presented to the Commission upon adoption of this Resolution, and
the Commission hereby authorizes the Executive Director of the Agency to execute the Agreement
on behalf of the Agency together with such technical .and conforming changes as may be
recommended by the Executive Director of the Agency and approved by the Agency Counsel.
Section 2.
The Commission hereby finds and determines that the approval, execution
and delivery of the Agreement is exempt from CEQA.
Section 3.
The Resolution shall become effective immediately upon its adoption.
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RESOLUTION OF THE COMMUNITY DEVELOPMENT COMMISSION
OF THE CITY OF SAN BERNARDINO APPROVING AND
AUTHORIZING THE EXECUTIVE DIRECTOR OF THE
REDEVELOPMENT AGENCY OF THE CITY OF SAN BERNARDINO
("AGENCY") TO EXECUTE THE REDEVELOPMENT PROJECT
STUDY AND EXCLUSIVE RIGHT TO NEGOTIATE AGREEMENT
WITH HOPROCK 2 VERDEMONT, LLC ("DEVELOPER")
VERDEMONT AREA
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I HEREBY CERTIFY that the foregoing Resolution was duly adopted by the Community
7 Development Commission of the City of San Bernardino at a
8 thereof, held on the _day of
9 Commission Members: Aves
10 ESTRADA
11 BAXTER
12 VACANT
13 DERRY
_14 KELLEY
JOHNSON
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16 MC CAMMACK
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The foregoing resolution is hereby approved this
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Agency Coun I
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, 2006, by the following vote to wit:
Abstain
Absent
Secretary
day of
Patrick J. Morris, Chairperson
Community Development Commission
of the City of San Bernardino
meeting
,2006.
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EXHIBIT "B"
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REDEVELOPMENT AGENCY
OF THE CITY OF SAN BERNARDINO
REDEVELOPMENT PROJECT STUDY AND
EXCLUSIVE RIGHT TO NEGOTIATE AGREEMENT
HOPROCK 2 VERDE MONT, LLC
(VERDEMONT HEIGHTS TOWNE CENTER)
THIS REDEVELOPMENT PROJECT STUDY AND EXCLUSNE RIGHT TO NEGOTIATE
AGREEMENT is dated as of November 20, 2006 (this "Agreement"), and is entered into by and
between HopRock 2 Verdemont, LLC (the "Developer"), a Delaware limited liability company,
authorized to do business in the State of California, and the Redevelopment Agency of the City of San
Bernardino (the "Agency"), a public body, corporate and politic, in light of the facts set forth in the
following recital paragraphs:
RECITALS
A. The Agency desires to encourage and effectuate the redevelopment of certain real
property, located within the area commonly referred to as the Verdemont Area (the "Verdemont Area")
of the City of San Bernardino (the "City").
B. The City is the fee owrier of approximately twenty-two (22) acres generally known as
the "Blast" soccer fields and the "Guhin Park" (collectively, the "Property") which consists of
improved land. The Property is currently zoned for public recreational use, is located adjacent to the
Developer Property (as defined below) and is bounded by Little League Drive to the north and west,
the County Flood Control Channel (the "County Flood Control Channel") to the east and vacant land
to the south. The Agency and the Developer understand and acknowledge that the City will have the
sole and absolute discretion whether to declare the Property surplus and upon such terms and
conditions to be approved by the City to thus provide for the transfer of the Property to the Agency for
subsequent transfer thereof to the Developer as contemplated by this Agreement and the Project DDA
as hereinafter defined. It is further understood and acknowledged by the Agency and the Developer
that in furtherance of such anticipated transfer of the Property, the City may be required to comply
with the provisions of the Public Park Preservation Act of 1971 as found in Public Resources Code
Section 5400, et seq.
C. The Developer is the fee owner of approximately thirty-seven and three-tenths (37.3) .
acres (the "Developer Property") adjacent to the Property and depicted on Exhibit "A" attached hereto
and incorporated herein by this reference. The Property and the Developer Property (collectively, the
"Study Area") consist of approximately fifty-nine and three-tenths (59.3) acres. The Study Area is
located within the Verdemont Area, and is depicted on the Study Area Map attached as Exhibit "A"
(which illustrates the Study Area for purposes of this Agreement).
D. The Agency and the Developer understand and acknowledge that the Property will have
to be rezoned from its current "public recreational use" to "commercial use" as a condition precedent
to the combination of the Property and the Developer Property and the Developer's development of the
Project (as defined below) on the Study Area, as contemplated by this Agreement.
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E. The Agency is prepared to consider and study specific proposals and plans to facilitate
the development of the Study Area so as to foster the community economic development goals and
objectives of the City.
F. The Developer is qualified to assist the Agency to undertake the study of specific
proposals and plans for a coordinated and economically sustainable redevelopment project on the
Study Area which will require specific study, evaluation, and planning by the City and the Agency, as
applicable, of appropriate and feasible community redevelopment program alternatives.
G. The Developer and the Agency believe it is appropriate for the Developer, in
consultation with the Agency, to undertake certain redevelopment studies and to incur certain costs, in
consultation with the Agency, as part of a program for the study of feasible redevelopment programs
for the Study Area, subject to the terms and conditions as set forth below.
COVENANTS
IN CONSIDERATION OF THE FOREGOING RECITALS, WHICH ARE INCORPORATED
INTO THIS AGREEMENT BY THIS REFERENCE AND THE MUTUAL COVENANTS AND
PROMISES SET FORTH HEREIN, THE DEVELOPER AND THE AGENCY HEREBY AGREE,
AS FOLLOWS:
1. Develooer Acknowled2ments and Term of A2reement.
a. The Developer hereby acknowledges and agrees that no provision of this Agreement
shall be deemed to be an offer by the Agency or an acceptance by the Agency of any offer or proposal
from the Developer to convey any interest in the Property to the Developer. Any studies relating to the
Study Area and to the Project (as defined below) that may hereafter be undertaken by the Developer, in
its sole discretion, shall be the sole responsibility of the Developer and shall not be deemed to be
undertaken for the benefit ofthe Agency and the City.
b. The qualifications and identity of the Developer and its principals are of particular
importance to the Agency. The Agency relied on these qualifications and identity in entering into this
Agreement with the Developer. Accordingly, except as expressly set forth hereinbelow, during the
term of this Agreement, the Developer shall not transfer or assign all or any of the Developer's rights
or obligations set forth in this Agreement (hereinafter, collectively, a "Transfer") and no voluntary or
involuntary successor-in-interest of the Developer shall acquire any rights or power under this
Agreement except pursuant to an assigmnent approved in writing by the Executive Director of the
Agency. For purposes of this Agreement, a Transfer shall include both (i) a transfer on a cumulative
basis of more than twenty-five percent (25%) of the beneficial ownership interest in the Developer that
was owned or controlled by one or both of Hopkins Real Estate Group, a California corporation
("HREG"), and HopRock 2 REIT Sub, LLC, a Delaware limited liability company ("Rockwood"), to a
third party or parties (but not a transfer of any portion of the beneficial ownership interest in the
Developer between or among HREG, Rockwood, and/or an Affiliate of HREG or Rockwood) and (ii)
a transfer of the management and control of the Developer from HREG to a third party (other than to
Rockwood or to an Affiliate of HREG or Rockwood). As used herein, the term "Affiliate" means any
entity that is either a parent or subsidiary of either HREG or Rockwood and/or any entity in which
either HREG or Rockwood or such parent or subsidiary owns a controlling interest and exercises
management control. The Executive Director of the Agency shall approve or disapprove any requested
Transfer requiring Agency approval within ten (10) business days after receipt of a written request for
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approval from the Developer, together with such documentation as may be reasonably required by the
Executive Director of the Agency, to evaluate the proposed transaction and the proposed
assignee'sltransferee's experience and qualifications, including the proposed assignment and
assumption agreement by which the assignee expressly agrees to assume all rights and obligations of
the Developer under this Agreement arising after the effective date of the assignment, and in which the
assignee/transferee agrees to assume, or the Developer expressly remains responsible for, all
performance and obligations of the Developer arising prior to the effective date of the Transfer. The
assignment and assumption agreement shall be in a form reasonably acceptable to the Agency's legal
counsel. No later than the date the Transfer becomes effective, the Developer shall deliver to the
Agency the fully executed assignment and assumption agreement.
c. Notwithstanding any other provision set forth in this Agreement to the contrary, the
Agency's approval of a Transfer by the Developer shall not be required in connection with any of the
following transactions:
(1) Transfers resulting from the death or mental or physical incapacity of an
individual;
(2)
the approval and execution by the Developer of one or more purchase/sale
agreements, leases, and other similar agreements that are not inconsistent with
the Developer's ultimate development of the Project (as defined below), and
with the understandings that no such agreement shall be deemed to limit or
restrict the Agency's or the City's discretion with respect to the terms and
conditions of any of the Development Entitlements referred to in Section 2 or
the terms and conditions to be set forth in the Project DDA referred to in Section
7 of this Agreement and any such agreement that pertains to all or any portion of
the Property shall not be binding upon the Agency, the City or the Property until
the Project DDA is approved and executed by all parties (and then subject to
such terms and conditions that may be set forth in the Project DDA);
(3) the granting of such temporary or permanent easements or permits as may be
requested by the City or other governmental agencies or utility companies with
jurisdiction over the Study Area or as may be necessary and appropriate to
facilitate development of the Project on the Study Area; and
(4) Transfers for financing purposes.
d. . This Agreement shall automatically terminate, without further notice or' action, and be
of no further force or effect twelve (12) months following the Effective Date, unless prior to that time:
(1) the parties execute the Project DDA, as described below, which will include,
without limitation, other relevant community redevelopment covenants
acceptable to the Agency and such other terms and conditions mutually
acceptable to the parties, in which case this Agreement shall terminate on the
effective date of the Project DDA; or
(2)
the parties each agree to extend the term of this Agreement in writing to a
specific date not to exceed twelve (12) months beyond the initial term of this
Agreement, subject to the Executive Director of the Agency first making a
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finding based upon written documentation and other facts presented to verify
that satisfactory progress is being made to complete the activities to be
performed by the Developer set forth in Section 3; for purposes of implementing
this extension provision to the term of this Agreement by and on behalf of the
Agency, and subject to said finding to be made by the Executive Director of the
Agency, (i) the Executive Director of the Agency is hereby authorized to
administratively approve one (I) extension of not to exceed six (6) months and
(ii) the governing body of the Agency shall be required to approve any
extensions in excess of six (6) months but not to exceed the aforesaid twelve
(12) months; or
(3)
a party terminates this Agreement as provided under Section 19 or Section 20, as
applicable.
2. The Project.
Subject to the terms and conditions of this Agreement, the negotiation and execution of a
mutually satisfactory Project DDA as referred to in Sections 3.t: and 7, the approval by the City, the
Agency and other governmental agencies with jurisdiction over the Study Area of the general plan
amendment, zone change and other discretionary permits and approvals that are needed to
accommodate the development contemplated by this Agreement (collectively, the "Development
Entitlements"), the City's or the Agency's completion of the environmental review process and
certification of an environmental impact report ("EIR") for the development of the Study Area
pursuant to the California Environmental Quality Act ("CEQA") and compliance with all other
applicable state and local laws, ordinances and regulations for such development, the Developer shall
take all reasonable actions required or necessary for determining the feasibility of the acquisition and
redevelopment of the Property and undertaking a commercial and retail development project on the
Study Area consisting of major retail anchor tenants, secondary retail anchors, and other retail uses
such as restaurants and a fitness center with approximately 675,000 square feet of gross building area,
plus related driveways, parking areas, loading docks, lighting, landscaping and related improvements
(collectively, the "Project"). As of the Effective Date of this Agreement, and subject to the satisfaction
of all of the conditions and contingencies referred to the above, the parties anticipate that the Project
will include quality retail tenants such as (i) Wal-Mart Super Center; (ii) Super Target; (iii) Bed Bath
and Beyond; (iv) Linens-n-Things; (v) Nordstrom's Rack; (vi) TJ. MliXX; (vii) Ross Dress for Less;
(viii) Marshall's; (ix) Barnes & Noble and/or Border's; (x) Circuit City and/or Best Buy; (xi) quality
restaurants such as Macaroni Grill, Chili's, Red Robin; (xii) Home Depot; and/or (xiii) any similar
quality commercial retail and restaurant tenants.
The Developer may modify the description of the Project at any time; provided, however, that
substantial modifications ofthe Project shall:
(I) be subject to the written acceptance and written approval ofthe Agency; and
(2)
depending on the nature of such a modification, a suitable modification of any
applicable development permit and CEQA application and approval and the
Project Study referred to below may also be required.
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The Agency may request that the Developer consider modifications to the description of the
Project from time-to-time. Each such modification shall be subject to the approval of the Developer,
which shaH not be unreasonably withheld.
3. Nel!otiation Period. Proiect Study and Proiect Study Costs.
a. The rights and duties of the parties established by this Agreement shall commence
foHowing its approval by the governing body of the Agency when it has been fuHy executed by the
parties within the period of time authorized in Section 17 (such date being the "Effective Date") and
continue for twelve (12) months from the Effective Date unless such date shall have been first
extended as authorized under Section l.d.(2). Such time period during which this Agreement shaH be
in effect (including any extensions of time approved by the Agency) is referred to as the "Negotiation
Period".
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b. Within ninety (90) days foHowing the Effective Date, the Developer shall submit to
Agency a site plan for the Study Area and a feasibility study for the redevelopment project proposed
by the Developer (the "Project Study"). The Project Study shaH include, without limitation, the
following information: (i) projections of the total estimated cost of the Project and the amount of debt
and equity to be contributed by the Developer to the Project; (ii) projections of the type, amount and
source of any financial assistance that the Developer may propose to have the Agency contribute to the
Project; (iii) projections of the overall Project value and property taxes; (iv) projections of the costs
and benefits to the City and the Agency for aH construction, maintenance and operations of all
proposed public improvements; (v) projections of the costs of additional or increased levels of public
services; (vi) projections of any new public revenues anticipated to be generated by the Project, by
phase, if applicable, and upon completion of the Project; (vii) projections of the number and type of
jobs that will be generated by the Project during both the construction phase and upon full build-out
and occupancy of the stores comprising the Project; (viii) aH proposed Development Entitlements that
are required to be obtained for the Project from the City and other govermnental agencies with
jurisdiction in order to accommodate the Project; and (ix) a proposed time schedule for construction
and installation of all of the private and public improvements and infrastructure comprising the Project.
The Agency may retain the services, but is under no obligation to do so, of a firm of
community redevelopment and planning and enviromnental consultants to assist in the preparation and
review of the various investigations, surveys and reports appropriate in connection with the Project
Study and the Project proposed by the Developer.
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c. The Agency shall, on a best efforts basis during the course of the Project Study,
consider the specific terms and conditions of any monetary redevelopment assistance which the
Developer may propose to include in the Project DDA; provided, however, the Agency reserves the ,
right to accept, reject or modify any such proposed term or condition to the Project DDA in its sole
discretion. In this regard, the Agency acknowledges that the Developer has advised the Agency prior
to the Effective Date of this Agreement that in Developer's opinion the financial feasibility of the
Project will require the Agency to pay all costs incurred to construct and instaH certain off site public
improvements of general benefit to the community that will or may be required in conjunction with the
Project, including, without limitation, (i) the expansion/widening/relocation of Little League Drive: (ii)
traffic signalization and intersection-related improvements; (iii) improvements to the on/off ramps to
the 1-215 Freeway in the vicinity of the Study Area; and (iv) utility improvements and upgrades and
additional infrastructure constructed or installed in conjunction with development of the Project but of
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general benefit to the community, bl,lt the Agency has not made any determination or precommitment
with respect thereto.
d. During the course of the Project Study, the Developer shall pay for all of its costs
associated with the Project Study, including but not limited to, the expen~es of third party consultants
who are engaged by the Developer under written contract to undertake one or more elements of the
Project Study (collectively, the "Project Study Costs"). The Project Study Costs that are the
Developer's responsibility do not include any third party costs incurred by the Agency in connection
with the Agency's review of the Developer's submittals or the Agency's independent performance of
any study or document as part of the Project Study. In addition, each party shall bear its own legal fees
and overhead and administrative costs in connection with the preparation and review of the Project
Study.
e. All third party consultants retained by the Agency to prepare any study or document as
part of the Project Study shall be subject to the sole control and direction of the Agency. The work
product of any such person shall be the property of the Agency and the Agency shall have the right to
use and republish such work product for any purpose; provided, however, that to the limited extent the
Developer provides the Agency with copies of architectural and engineering plans or drawings, the
Developer does not thereby transfer to the Agency the ownership rights with respect thereto or the
rights to reuse or republish the same and the Developer does not waive any legal rights it might have
with respect to such work product and the Agency's use and republishing of such work product in the
absence of this Agreement.
f. The Developer shall inform the Agency in writing whether, based on the information set
forth in the Project Study to be submitted to the Agency pursuant to Section 3.b., the Developer
believes the Project is feasible. Thereafter, assuming the Developer has determined the Project is
feasible, the Developer and the Agency may proceed to negotiate the final form of an agreement which
will specifY the specific business terms upon which the Property will be conveyed to the Developer
and the Project will be developed (the "Project DDA"), subject to the understandings that (i) the
Agency reserves the right, in its sole and absolute discretion, to approve or disapprove the Project
DDA and the Agency does not preapprove or precommit to any particular terms to be included in the
Project DDA; (ii) the Project DDA will not constitute City or Agency approval of the Project, which.
shall not occur until such later date that the Development Entitlements are approved and all applicable
CEQA approvals are issued; and (iii) in no event will the Project DDA provide for or allow the
conveyance of the Property to the Developer prior to the issuance of all of the Development
Entitlements and the City's or the Agency's approval of the necessary process for approving the
Project consistent with CEQA.
g. Within twenty (20) calendar days from receipt of any information from the Developer
as provided in this Section 3, the Executive Director of the Agency shall determine whether such
information is satisfactory. If the specific item of information is unsatisfactory to the Executive
Director of the Agency, he or she shall notifY the Developer in writing of the reason(s) that the
information is unsatisfactory. If the Executive Director of the Agency does not make a determination
regarding any item of information submitted by the Developer under this Section 3 within twenty (20)
calendar days from receipt of such information, the information shall be deemed submitted in
acceptable form by the Agency. The determinations to be made by the Executive Director of the
Agency under this subsection in no way bind or constitute the approval of the Agency regarding,
without limitation, plans, specifications, engineering, architecture, uses, tenants, the Project, the
Development Entitlements, the Project's satisfaction of the requirements of CEQA, or the Project
DDA.
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4. Oblil!ations of the Developer.
During the Negotiation Period, the Developer shall proceed diligently and in good faith to
perform the following:
a. consider the redevelopment of the Project, including, without limitation, the selection of
tenants and the design of improvement elements as appropriate for the Project; and
b. review and provide the Project Study information described in Section 3 and, if
acceptable to the Developer, submit an executed copy of the final form of the Project DDA to the
Executive Director of the Agency on or before the end of the Negotiation Period (or such later date
corresponding to an authorized extension of the Negotiation Period); and
c. consult with the Agency on a regular basis and keep the Agency advised on the progress
of the Developer in completing its obligations under this Agreement.
In addition to the foregoing, during the Negotiation Period, the Developer shall have the right
but not the obligation to file a formal application with the City for approval of one or more of the
Development Entitlements for the Project and to initiate the process under CEQA for preparing an
initial study and a draft EIR to enable the City and the Agency to independently evaluate the
environmental impacts of the Project, a reasonable range of feasible alternatives to the Project, and
feasible mitigation measures that may reduce potentially significant environmental impacts of the
Project to an acceptable level, all in accordance with CEQA. In the event that the Developer elects to
file any such application and/or initiate the CEQA review process during the Negotiation Period and
prior to the parties' approval and execution of a Project DDA, the Agency shall cooperate reasonably
with the Developer in such regard, subject to the understandings that (i) the Agency does not
precommit to support or approve any of the Development Entitlements or the Project EIR, it being
understood that the Agency reserves whatever discretionary authority it would otherwise have with
respect to such matters in the absence of this Agreement; (ii) the Agency's approval of the Project
DDA prior to issuance of the Development Entitlements and certification of the Project EIR shall not
constitute an approval of or precommitment with respect to the Project; and (iii) the Project DDA will
include provisions that the conveyance of the Property to the Developer and the Developer's right to
develop the Project will be conditional and contingent upon the City's and the Agency's approval of
the Project, the Development Entitlements and the EIR at a later date.
s. Al!encv Not to Nel!otiate with Others.
a. The Agency currently deems the acquisition of the Property by the Agency from the .
City, disposition of the Property by the Agency to the Developer, and redevelopment of the Study Area
for a feasible Project to be appropriate for further review and consideration, and the Developer appears
to be qualified to undertake the task of planning the details for the potential acquisition of the Property
and development ofthe Study Area.
b. During the Negotiation Period, the Agency shall not negotiate with any other person or
entity regarding either the disposition of the Property or the redevelopment of all or any portion of the
Project. The term "negotiate", as used herein, shall be deemed to preclude the Agency from approving
any other offer or proposal from a third party to either acquire from the Agency any interest in the
Study Area (in whole or in part) or development of the Project in the Study Area, and from discussing
other redevelopment proposals for the Study Area with third persons or entities; provided, however,
any person may submit and the Agency may consider any proposal for the disposition and/or
redevelopment oflands adjacent to the Study Area.
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c. Notwithstanding any other provision of this Agreement, during the Negotiation Period,
the Agency shall not be precluded from furnishing to persons or entities unrelated to the Developer
information in the possession of the Agency relating to the redevelopment of any other land owned or
controlled by the City or the Agency outside but in close proximity to the Study Area. Subject to its
obligations set forth in S.b. above, the Agency may also provide any other information in its possession
that would customarily be furnished to persons requesting information from the Agency regarding the
Study Area and other Agency public information concerning its activities, goals and matters of a
similar nature, or as required by law to be disclosed upon request.
6. Aeencv Cooperation.
During the Negotiation Period, the Agency shall:
a. at the request of Developer, use its best efforts to assemble written materials and
documents relating to the Property that are in the possession of the Agency;
b. use its best efforts to provide appropriate and timely comments to the Developer with
respect to one or more conceptual development plans, as may be proposed by the Developer for the
Project, and the redevelopment of the Study Area, including, but not limited to, conceptual plans or
studies of vacation, realignment or abandonment of public property and facilities, the installation and
improvement of public improvements, any formal Development Entitlements applications that may be
filed by the Developer during the Negotiation Period, and any environmental evaluation of the Project
that may be undertaken during the Negotiation Period under CEQA (but reserving the Agency's
discretion and authority with regard to support and approval of such matters as set forth in the last
paragraph of Section 4 above);
c. use its best efforts to provide the Developer with limited access to the Property during
the Negotiation Period, for the purpose of conducting customary due diligence investigations thereon,
including environmental investigations of the subsUrface or any structure thereon, subject to the terms
. and conditions of a separate environmental investigation and inspection license agreement to be agreed
upon by the Agency and the Developer, at some later date, if applicable; and
d. use its best efforts to provide the Developer with information or copies of all reports,
studies, and other information in the City's or the Agency's possession relative to the. Property and the
status of the City's and the Agency's efforts to relocate existing City recreational park uses off of the
Property as needed to accommodate the Project.
7. Neeotiation of Project DDA.
It is the intent of the parties that the Developer and the Agency will negotiate the fmal terms
and conditions of a proposed Project DDA between the date that the Developer submits the Site Plan
and Project Study for the Project to the Agency pursuant to Section 3.b. ofthis Agreement at the end of
the Negotiation Period. Notwithstanding such commitment of the Agency to negotiate the terms and
conditions of the final Project DDA, nothing contained herein commits the Agency Staff to
recommend approval of any final form of a Project DDA presented for consideration by the
Community Development Commission (the "Commission"), nor shall the Commission be committed
to approve any fmal form of a Project DDA by reason of the execution of this Agreement or by reason
of any other. actions of the Agency, the Agency Staff or the Commission prior to the conducting of a
noticed public hearing on the consideration of the Project DDA in the manner as required by law.
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Should the Agency and the Developer execute and deliver a Project DDA, the parties anticipate
as of the Effective Date that the Project DDA will or may include, without limitation, the following
terms, provisions and covenants:
(I) that the purchase price for the Property will be the fair market value of the
Property no more than six (6) months prior to the anticipated transfer of the
Property to the Developer (in accordance with and pursuant to the Project
DDA), as determined by a MAl appraiser acceptable to the Agency in its sole
discretion subject to the City declaring the Property as surplus to the needs of
the City as further specified in Recital B hereof; and
(2)
in the event the Developer and the Agency anticipate that the Project will or
may result in the closing of any existing retail store in the City with more than
twenty-five thousand (25,000) feet of retail floor area within three hundred
sixty- five (365) days before or after such retail store opens for business in the
Study Area, provisions will or may be included for the reuse and reoccupancy of
the existing store location or locations; provided, however, it is understood that
the Developer cannot warrant or represent to the Agency as of the Effective
Date of this Agreement that the Developer will be able to guarantee the
continued use and occupancy of any such existing store location or locations that
may be closed and, accordingly, the Developer cannot warrant or represent to
the Agency that the Developer will be able to commit in the Project DDA to
provide for such continued use and occupancy of any such store location or
locations that may be closed; and
(3) such provisions for Agency financial assistance for off-site public improvements
to which the Agency and the Developer may mutually agree, as referred to in
Section 3.c. of this Agreement, and subject to the understanding that the Agency
does not precommit to any such financial assistance in this Agreement; and
(4) an acknowledgment that the Agency's approval of the Project DDA does not
constitute the Agency's or the City's approval of the Project for purposes of
CEQA and that the conveyance of the Property to the Developer and the
Developer's right and obligation to develop the Project in the Study Area will be
conditional and contingent upon the issuance of all of the Development
Entitlements and certification of the Project EIR; and
,(5) that the Project, if approved, will involve a total development with a minimum
development cost of Seventy-Six Million Dollars ($76,000,000); and
(6) a provision that the ERN Fee payable pursuant to Section 30 of this Agreement
shall be credited in full toward the Developer's purchase price for the Property.
8. Consideration for this A2Teement and Reservation of Ril!hts.
In consideration for the Agency entering into this Agreement, the Developer will undertake its
obligations under this Agreement and provide the Agency with copies of all studies and reports and
other information generated by the Developer or its consultants regarding the Project; provided,
however, that nothing set forth in this Agreement shall obligate the Developer to provide the Agency
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with information relating to confidential contract negotiations with prospective tenants or other end
users or any other confidential financial or business information that is not reasonably required by the
Agency to perform its obligations set forth in this Agreement. The parties agree that, if this Agreement
terminates for any reason, or the Agency fails to extend the Negotiation Period, or the Project DDA is
not finally approved by the Agency, for any reason, neither party shall have any further obligation to
the other under this Agreement regarding the disposition, acquisition, reuse, redevelopment or
development of the Study Area except for the provisions as set forth in Section II which shall survive
for a period of time equal to six (6) months after the termination date of this Agreement and under the
circumstances as set forth therein.
9. Planninl! and Desil!n: Related Acknowledl!ments of the Parties.
Certain development standards and design controls for the Project may be established between
the Developer and the Agency in negotiation of or in the final form of the Project DDA, but it is
understood by both parties that the Project must conform to the City's development, design and
architectural standards. The Agency shall fully cooperate with the Developer's professional associates
in providing information and non-monetary assistance in connection with the Developer's preparation
of drawings, plans, and specifications. Nothing in this Agreement shall be considered approval of any
plans or specifications for the Project, itself, by either the Agency or the City.
10. Developer Financial Disclosures.
Subject to its reserved rights set forth in Section 8 hereinabove, the Developer acknowledges
that it may be requested to make certain confidential financial disclosures to the Agency, its staff or
legal counsel, as part of the financial due diligence investigations of the Agency relating to the
potential disposition of the Property to the Developer or development of the Project. The parties
recognize that such financial disclosures may contain sensitive information relating to other business
transactions of the Developer, that the disclosure of such information to third parties could impose
commercially unreasonable and/or anti-competitive burdens on the Developer and, correspondingly,
diminish the value or fiscal benefit that may accrue to the Agency upon the disposition of the Property
to the Developer, if terms for such disposition are mutually agreed upon. Accordingly, the Agency
agrees to maintain the confidentiality of any business records described in Government Code Section
6254.15, as may be provided by the Developer to the Agency or its consultants, as permitted by law.
The Agency shall advise the Developer of any Public Records Act requests for such business records,
and the proposed response of the Agency thereto, a reasonable time prior to the Agency's delivery of
such response and, if the Agency proposes to disclose any such business records, the Agency shall first
agree to confer with the Developer to consider any objections that the Developer may have to such
disclosure.
II. Developer Acquires No Interest in the Property.
The Developer hereby acknowledges that it has not acquired and will not acquire, by virtue of
the terms of this Agreement, any legal or equitable interest in the Property. From and after the
termination date of this Agreement and for six (6) months thereafter, and provided that there is no
Project DDA then in effect, the Agency Staff will endeavor to work in cooperation with the Developer
to obtain from the City Development Services Department such satisfactory commitment for the
realignment of Kendall Drive from the Developer Property northerly to Little League Drive. The
Agency will not be required to expend funds for any third party costs or for other consultants or legal
counsel unless agreed in advance to be reimbursed by the Developer to the Agency. Nothing
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contained in this provision shall imply or require that the Property which is comprised of the "Guhin
Park" site and the "Blast" soccer fields will be used either in whole or in part to accommodate the
realignment of Kendall Drive to Little League Drive nor to require the City to declare as surplus real
property and sell all or any portion of the Property to the Developer either for private development
purposes or for any realignment of Kendall Drive to Little League Drive.
12. Nondiscrimination.
The Developer shall not discriminate against nor segregate any person, or group of persons on
account of race, color, creed, religion, sex, marital status, handicap, national origin or ancestry in
undertaking its obligations under this Agreement.
13. Comoliance with Law. .
The Developer acknowledges that the Project DDA, if mutually agreeable terms are
established, is likely to require the Developer (among other things) to carry out the construction of
certain improvements in conformity with all applicable laws, including all applicable planning and
zoning laws, and environmental planning and safety laws. The parties agree that it is their intention as
of the Effective Date of this Agreement that in order to assure the feasibility of the Project, they will
cooperate in an effort to cause the Project DDA to be structured in such a manner that any public
financial assistance does not result in the Project being classified as a "public work" for purposes of
California prevailing wage law requirements except to the extent that prevailing wages may have to be
paid with respect to public improvements paid for in whole or in part with Agency funds.
14. Required Aoorovals.
No Project DDA between the parties shall have any force or effect nor shall the Agency be
deemed to be a party to any agreement for the disposition of real or personal property to the Developer,
until the terms and conditions of the Project DDA are considered and approved by the governing body
of the Agency, following the conclusion ofa public hearing, as required by law.
15. Press Releases.
The Developer agrees to discuss any press releases it may propose relating to the Study Area
with the Executive Director of the Agency or his/her designee, prior to publication, to assure accuracy
and consistency of the information.
16. Notice.
All notices required hereunder shall be presented either (i) in person or (ii) by fax and
confirmed by First Class certified or registered United States mail with return receipt requested.
Notice shall be deemed confirmed by United States mail effective the second business day after
deposit with the United States Postal Service. Notice by personal service shall be deemed effective
upon delivery. Either party may change its address for receipt of notice by notifying the other party in
writing.
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TO DEVELOPER:
HopRock 2 Verdemont, LLC
clo Hopkins Real Estate Group
Attn.: Brian Hopkins
Vice President, Director of Development
17461 Derian Avenue, Suite 106
Irvine, California 92614
(949) 640-1770
WITH A COpy TO:
Rockwood Capital Corporation
Attn.: Jennifer A. Levy
Vice President - Controller
Two Embarcadero Center, 23'd Floor
San Francisco, California 94111
(415) 645-4322
TO AGENCY:
Redevelopment Agency of the City of San Bernardino
Attn.: Maggie Pacheco, Executive Director
201 North "E" Street, Suite 301
San Bernardino, California 92401
(909) 663-1044
17. Acceptance of Al!reement bv the Developer.
The Developer shall acknowledge its acceptance of this Agreement by delivering three (3)
counterpart executed copies of this Agreement prior to the date of consideration and approval of this
Agreement by the Commission. As further set forth in Section 3a. hereof, the Effective Date of this
Agreement shall be deemed to have occurred upon final approval of the Commission and execution by
both the Developer and the Executive Director of the Agency.
18. Authoritv.
Each signatory to this Agreement represents and warrants that he or she has the authority to
execute this Agreement on behalf of the principal whom he or she purports to represent.
19. Optional Termination bv Developer or bv Al!encv.
a. The Developer may, in its sole and absolute discretion, exercise an election to terminate
this Agreement provided that the Developer gives at least a twenty-one (21) day advance written notice
to the Agency. If the Developer terminates this Agreement, it shall not be entitled to a refund of any
portion of the ERN Fee referred to in Section 30, it shall remain responsible for performance of its
indemnity obligations set forth in Section 22 with respect to any acts or omissions of the Developer
occurring prior to the effective date of the termination, the Agency shall continue to perform its
obligation set forth in the last sentence of Section II, and otherwise, neither party shall have any
further rights or obligations to the other party hereunder.
b. The Agency may not exercise an election to suspend the Project or to terminate this .
Agreement other than as provided in Section 20 hereof.
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20. Defaults and Breach - General.
Failure or delay by either party to perform any material term or provision of this Agreement
shall constitute a default under this Agreement; provided, however, that if the party who is otherwise
claimed to be in default by the other party commences to cure, correct or remedy the alleged default
within five (5) business days after receipt of written notice specifying such default and shall in fact
complete such cure, correction or remedy, with reasonable diligence, such party shall not be deemed to
be in default hereunder.
The party, which may claim that a default has occurred, shall give written notice of default to
the party in default, specifying the alleged default. Delay in giving such notice shall not constitute a
waiver of any default nor shall it change the time of default; provided, however, the injured party shall
have no right to exercise any remedy for a default as set forth herein without delivering the written
default notice as specified herein.
Any failure to delay by a party in asserting any of its rights and remedies as to any default shall
not operate as a waiver of any default or of any rights or remedies associated with such a default.
In the event of an uncured material breach, the party who is not in default shall be entitled to
seek any appropriate remedy by initiating legal proceedings; provided, however, that, other than with
respect to a Developer default in failing to perform its indemnity obligations set forth in Section 22, (i)
the Agency shall not be entitled to specific performance or other equitable or injunctive relief against
the Developer for a default by the Developer hereunder and (ii) the Agency's sole damages remedy
shall be to retain the Developer's entire ERN Fee referred to in Section 30 as liquidated damages.
In the event that a material breach has occurred and the non-performing party has not cured
such breach within the period of time provided for in this Section 20, the party who is not then in
default may terminate this Agreement by serving the other party with a written notice of termination,
and thereafter, the Agreement shall terminate on the date specified in such notice, which date shall not
be earlier than the later of (i) ten (10) days following the date of service of the notice of termination on
the other party or (ii) the date otherwise specified in such notice.
21. Attornevs' Fees.
If any party hereto files any action or brings any action or proceeding against the other arising
out of this Agreement, or is made a party to any action or proceeding brought by a third party, then as
between the Developer and the Agency, the prevailing party shall be entitled to recover as an element . .
of its costs of suit, and not as damages, its reasonable attorneys' fees as fixed by the Court, in such
action or proceeding or in a separate action or proceeding brought to recover such attorneys' fees. As
between the Developer and the Agency, the prevailing party shall be entitled to recover as an element
of its costs of suit, and not as damages, its reasonable attorneys' fees as fixed by the Court, in such
action or proceeding or in a separate action or proceeding brought to recover such attorneys' fees.
22. Indemnification.
The Developer agrees to indemnify, protect, defend (if requested by the Agency and/or the
City) and hold the Agency and/or the City, and their officers, employees and agents, harmless from
and against, without limitation, all actions, causes of action, claims, demands, damages, judgments,
costs, expenses and penalties (including, without limitation, attorneys' fees, court costs, consultant fees
and costs, and all attorneys' fees and court costs incurred in connection with all appeals), to the extent
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ansmg from or related to any uncured default by the Developer hereunder or any intentional
misconduct or negligent act or ornission of the Developer, its agents, employees and/or independent
contractors (and the successors and/or assigns of each of them) in performing, omitting, or failing to
perform, in its obligations hereunder (collectively, the "Claims"); provided, however, that (i) the
foregoing indemnity obligation shall not apply to the extent arty Claims arise out of any default by the
Agency in performing its obligations set forth in this Agreement or to the extent the Agency has
engaged in any intentional misconduct or is guilty of gross negligence and (ii) the foregoing indemnity
obligation shall not cover any Claim for exemplary or punitive damages unless the Developer is guilty
of malice. The Agency and/or the City shall give the Developer written notice of the occurrence of
any Claim for which the Agency and/or the City seek indemnity under this Section as promptly as
practicable fonowing the Agency's and/or the City's knowledge of the occurrence of such matter and
the Agency and/or the City shan reasonably cooperate with the Developer in the defense of any such
Claim. This indemnity provision shall survive the execution, delivery, expiration and/or termination of
this Agreement.
23. Governinl! Lllw: Venue.
The parties hereto expressly agree that this Agreement shall be governed by, interpreted under,
and construed and enforced in accordance with the laws of the State of California. Further, the parties
to this Agreement hereby agree that any legal actions arising from this Agreement shall be filed in
California Superior Court, in the County of San Bernardino, San Bernardino District.
24. Severabilitv.
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If any term, provision or portion of this Agreement or the application thereof to any person or
circumstance shall, to any extent, be invalid or unenforceable, the remainder of this Agreement, or the
application of such term or provision or portion thereof to persons or circumstances other than those as
to which it is held invalid or unenforceable, shan not be affected thereby, and each such term and
provision of this Agreement shall be valid and enforced to thefilllest extent permitted by law.
25. No Intent to Create Third Party Beneficiaries.
The parties intend that the rights and obligations under this Agreement shan benefit and burden
only the parties hereto, and do not intend to nor shall it create any rights in, or right of action to or for
the use or benefit of any third party, including any governmental agency, who is not one of the parties
to this Agreement.
26. Waivers.
No waiver of any breach of any covenant or provision herein contained shall be deemed a
waiver of any preceding or succeeding breach thereof, or of any other covenant or provision herein
contained. No extension of the time for performance of any obligation or act to be performed herein
shall be deemed to be an extension of the time for performance of any other obligation or act to be
performed under this Agreement.
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27. Entire Al!reement.
This Agreement (including Exhibit "A" attached hereto) is the final expression of, and contains
the entire agreement between the parties with respect to the subject matter hereof and supersedes all
prior understandings with respect thereto. This Agreement may not be modified, changed,
supplemented, or terminated, nor may any obligations hereunder be waived, except by written
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instrument signed by the appropriate party or by its agent duly authorized in writing or as otherwise
expressly permitted herein. This Agreement may be executed in one or more counterparts, each of
which shall be an original, and all of which together shall constitute a single instrument.
28. Time of Essence.
Time is strictly of the essence with respect to each and every term, condition, obligation and
provision hereof. Failure to timely perform any of the terms, conditions, obligations or provisions
hereof by either party shall constitute a default under this Agreement by the party so failing to perform,
which default can be waived by the other party at its sole and complete discretion.
29. Construction.
Headings at the beginning of each section, paragraph, and subparagraph are solely for the
convenience of the parties and are not a part of this Agreement. Whenever required by the context of
this Agreement, the singular shall include the plural and the masculine shall include the feminine and
vice versa. This Agreement shall not be construed as ifit had been prepared by one of the parties, but
rather as if both parties had prepared the same. Unless otherwise indicated, all references to sections
are to this Agreement. Exhibit "A" referred to in this Agreement is attached hereto and incorporated
herein by this reference as if fully set forth herein in its entirety.
30. ERN Fee.
Concurrently, with the execution and delivery of this Agreement by the undersigned parties on
the Effective Date, the Developer shall deliver to the Agency a check in the amount of Seventy-Five
Thousand Dollars ($75,000) representing the Exclusive Right to Negotiate Fee (the "ERN Fee"). In
the event the parties enter into a Project DDA, the parties intend that the Project DDA will provide that
the ERN Fee will be credited in full toward the Developer's purchase price for the Property. If the
parties do not enter into a Project DDA, the Agency shall be entitled to retain the entire ERN Fee as
compensation for removing the Property from consideration by other prospective purchasers and to
reimburse the Agency for its costs and expenses incurred for the negotiation and preparation of this
Agreement and performing its obligations hereunder. In addition, if the Developer commits an
uncured material default under this Agreement the Agency agrees that the amount of the ERN Fee
shall be the Agency's sole and exclusive damages remedy against the Developer except as specifically
set forth in Sections 21 and 22 of this Agreement, it being understood and agreed between the Agency
and the Developer that it would be extremely difficult or impracticable for the Agency and the
Developer to fix the actual amount of damages that the Agency would incur in the even~ of an uncured
Developer dllfault hereunder, that the parties desire to fix and liquidate the amount of such damages in
advance in order to eliminate the time, cost, and risk involved in prosecuting and defending litigation
to determine the amount of actual damages, and that the amount of the ERN Fee is a reasonable
estimate as of the Effective Date of this Agreement as to the amount of actual damages that would be
incurred by the Agency in such circumstances.
/II
/II
/II
/II
t 12/024846-000 I
738788.06 ,10124106
':~AfI~-AmcDd2006\il.2G-06HopJl.ock2.FinalBIlN-DOC
-15-
IN WITNESS WHEREOF, HopRock 2 Verdemont, LLC, and the Redevelopment Agency of
the City of San Bernardino execute this Redevelopment Project Study and Exclusive Right to
Negotiate Agreement on the dates indicated next to each of the signatures of their authorized
representatives as they appear below,
.
Dated: ,0 I ~O [ Of.,:,
I
e Dated:
^':~'ial"~ Cooreol
Agency Co el
e
DEVELOPER
HopRock 2 Verdemont, LLC,
a Dela e Ii 'ted liability company
By:
Its:~D(UtlT~_ rf> ~w(
AGENCY
Redevelopment Agency of the City of San Bernardino,
a public body, corporate and politic
By:
Maggie Pacheco, Executive Director
"
1121024846-0001
738788.06 110124106
P:\AaendaI\AccIxk AltlldunmtslApnu-Amtnd 2006\11-20-06 Hopa.ock 2 - f"....J EkNOOC
-16-
.
.
.'
EXHIBIT "A"
Study Area
112/024846-0001
738788.06 al0l24106
-17-
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