HomeMy WebLinkAboutCDC/2008-46
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10 WHEREAS, the Redevelopment Agency of the City of San Bernardino (the "Agency"), is a
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RESOLUTION NO. CDC/200B-46
RESOLUTION OF THE COMMUNITY DEVELOPMENT COMMISSION OF
THE CITY OF SAN BERNARDINO APPROVING THE SALE OF CERTAIN
REAL PROPERTY BY THE REDEVELOPMENT AGENCY OF THE CITY
OF SAN BERNARDINO ("AGENCY") TO WATERMAN HOLDINGS, LLC,
AND AUTHORIZING THE INTERIM EXECUTIVE DIRECTOR OF THE
AGENCY TO EXECUTE AMENDMENT NO.4 TO THE 2004 DISPOSITION
AND DEVELOPMENT AGREEMENT, AS AMENDED, BETWEEN THE
AGENCY AND WATERMAN HOLDINGS, LLC (4TH STREET AND
WATERMAN AVENUE - APN: 0135-191-17) (CENTRAL CITY EAST
REDEVELOPMENT PROJECT AREA)
11 public body, corporate and politic existing under the laws of the State of California, Health and
12 Safety Code Section 33100, and is charged with the mission of redeveloping blighted and
13 underutilized land; and
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WHEREAS, the Community Development Commission of the City of San Bernardino (the
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"Commission") is the governing board of the Agency; and
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WHEREAS, the City of San Bernardino, California (the "City") is a municipal corporation
18 and charter city, duly organized and existing pursuant to the provisions of the constitution of the
19 State of California; and
20 WHEREAS, on December 6, 2004, the Commission adopted Resolution No. CDC/2004-49
21 approving the sale of certain real property (APN: 0135-191-11) (the "Agency Property") by the
22 Agency to Waterman Holdings, LLC (the "Developer"), and authorizing the Agency Executive
23 Director to execute the 2004 Disposition and Development Agreement (the "DDA") between the
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Agency and the Developer; and
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WHEREAS, on June 20, 2005, the Commission adopted Resolution No. CDC/2005- I 9
27 approving and authorizing the Executive Director of the Agency to execute Amendment No.1 to the
28 DDA between the Agency and the Developer; and
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1 WHEREAS, Amendment No. 1 to the DDA caused Phase I and Phase II of the Project to
2 exchange locations for each such Phase; and
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WHEREAS, on June 19, 2006, the Commission adopted Resolution No. CDC/2006-20
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approving and authorizing the Executive Director of the Agency to execute Amendment No.2 to the
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DDA between the Agency and the Developer; and
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WHEREAS, Amendment No.2 to the DDA eliminated the previously proposed Phase I and
Phase II of the Project and was replaced with a single phase Project consisting of the construction of
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approximately 45,000 square feet, two-story building along with the appropriate and necessary
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improvements and landscaping, as well as establishing a reimbursement schedule wherein the
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Agency would pledge to the Developer, an amount equal to 60% of the 1% of new property taxes
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generated by the Project for a period often (10) years; and
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13 WHEREAS, on July 21, 2008, the Commission adopted Resolution No. CDC/2008-26
14 approving and authorizing the Interim Executive Director of the Agency to execute Amendment No.
15 3 to the DDA between the Agency and the Developer; and
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WHEREAS, Amendment No. 3 to the DDA will allow the Agency to reimburse the
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Developer, from the Agency Property sale proceeds, an amount not to exceed the lesser of the actual
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cost paid for the Off-Site Improvements or $399,500 utilizing prevailing wage rates; and
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WHEREAS, this payment will be made to the Developer 30 calendar days following the
completion of the Project as evidenced by a Certificate of Occupancy issued by the City and upon
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submission/validation by the Agency of the actual costs paid for the Off-Site Improvements; and
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23 WHEREAS, the Agency owns certain real property, approximately .84 acres, located south
24 of the southwest corner of 4th Street and Waterman Avenue within the Central City East
25 Redevelopment Project Area and is presently an unimproved flood control channel, APN: 0135-
26 191-17 (the "Flood Control Channel Property"); and
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WHEREAS, the Developer has determined that additional parking is necessary for the
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development of the Project to the north of the Flood Control Channel Property; and
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1 WHEREAS, the Developer has offered to purchase the Flood Control Channel Property
2 from the Agency; and
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WHEREAS, an appraisal of the Flood Control Channel Property was performed in August
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2008 by Smothers Appraisal (the "Appraiser"); and
WHEREAS, according to the report dated September 4, 2008 (the "Appraisal Report"),
7 prepared by the Appraiser, the fair market value of the Flood Control Channel Property is $36,000;
8 and
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WHEREAS, the Agency intends to enter into Amendment No. 4 to the DDA, as amended
10 (the "Amendment"), pursuant to which the Agency proposes to sell the Flood Control Channel
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Property to the Developer for the fair market value of $36,000; and
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WHEREAS, the Amendment provides for the development of the Flood Control Channel
Property so that it may be used as a parking lot; and
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15 WHEREAS, the Developer has estimated that it will cost $1,100,000 for the construction of
16 the improvements to the Flood Control Channel Property; and
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WHEREAS, the Agency has prepared and published a notice of joint public hearing in the
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San Bernardino County SUN newspaper on October 20,2008 and October 27, 2008, regarding the
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consideration and approval of the Amendment; and
WHEREAS, pursuant to Health and Safety Code Section 33433(b), the Agency may transfer
22 the Flood Control Channel Property to the Buyer subject to the Mayor and Common Council of the
23 City of San Bernardino (the "Council") and the Commission adopting separate Resolutions
24 authorizing the Agency to transfer the Flood Control Channel Property in light of the findings set
25 forth herein, pursuant to Health and Safety Code Section 33433; and
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WHEREAS, the Agency has prepared a Summary Report pursuant to Health and Safety
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Code Section 33433 (the "Report") that describes the salient point of the Amendment and identifies
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the cost of the Amendment to the Agency; and
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1 WHEREAS, pursuant to Section 15332 of the California Environmental Quality Act
2 Guidelines ("CEQA"), the Agency has reviewed the proposed sale and use of the Flood Control
3 Channel Property and has determined that the project, as identified in the Amendment, is exempt
4 from CEQA and qualifies as a Categorical Exemption, Class 32 (Guidelines 15332) as the project
5 meets all four requirements for an In-fill Project; and
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WHEREAS, disposition of the Flood Control Channel Property to the Developer IS
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consistent with the Central City East Redevelopment Plan; and
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9 WHEREAS, it is appropriate for the Commission to approve the Amendment and the
10 disposition of the Flood Control Channel Property to the Developer as set forth in the Amendment,
11 and this Resolution; and
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WHEREAS, on November 3, 2008, the Commission discussed the Amendment and the sale
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of the Flood Control Channel Property to the Developer, deciding to continue discussion on the
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Amendment and the public hearing concerning the sale to the Developer to November 17, 2008; and
WHEREAS, on November 17, 2008, the Commission continued the discussion of the
17 Amendment and public hearing of the sale of the Flood Control Channel Property to the Developer
18 to December 15, 2008.
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NOW, THEREFORE, THE COMMUNITY DEVELOPMENT COMMISSION OF THE CITY
20 OF SAN BERNARDINO DOES HEREBY RESOLVE, DETERMINE AND ORDER, AS FOLLOWS:
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Section 1.
On December 15, 2008, the Commission, as the governing board of the
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Agency, conducted a full and fair joint public hearing with the Council relating to the disposition of
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the Flood Control Channel Property from the Agency to the Buyer and the development thereof
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pursuant to the Amendment. The rninutes of the Agency Secretary for the November 3, 2008
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meeting of the Commission shaII include a record of all communication and testimony submitted to
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the Commission by interested persons relating to the public hearing and the approval of the
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Amendment.
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Section 2.
The Commission hereby receives and approves the Report and the other
2 written materials submitted to the Commission at the meeting at which this Resolution is adopted.
3 The Report contains information required under Health and Safety Code Section 33433.
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Section 3,
This Resolution is adopted in order to satisfy the provisions of Health and
5 Safety Code Section 33433(a)(I) and (b)(2) related to the disposition of the Flood Control Channel
6 Property to the Buyer in accordance with the Amendment. The Commission hereby finds and
7 determines as follows: that the Report contains the information described in Health and Safety
8 Code Section 33433(b)(2), wherein the Flood Control Channel Property is being sold to the Buyer
9 at the purchase price of $36,000 for the development of a parking lot which consideration is the fair
10 market value determined at its highest and best use in accordance with the Central City East
11 Redevelopment Plan.
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Section 4.
The Commission hereby approves the Amendment and the Interim
13 Executive Director is hereby authorized and directed to execute the Amendment on behalf of the
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Agency together with nonsubstantive and conforming changes as may be recommended by the
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Interim Executive Director and Agency Counsel. The Interim Executive Director is hereby
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authorized to take all appropriate actions as set forth in the Amendment to implement the
disposition and redevelopment of the Flood Control Channel Property.
This Resolution shall take effect from and after its date of adoption by this
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RESOLUTION OF THE COMMUNITY DEVELOPMENT COMMISSION
OF THE CITY OF SAN BERNARDINO APPROVING THE SALE OF
CERTAIN REAL PROPERTY BY THE REDEVELOPMENT AGENCY OF
THE CITY OF SAN BERNARDINO ("AGENCY") TO WATERMAN
HOLDINGS, LLC, AND AUTHORIZING THE INTERIM EXECUTIVE
DIRECTOR OF THE AGENCY TO EXECUTE AMENDMENT NO.4 TO
THE 2004 DISPOSITION AND DEVELOPMENT AGREEMENT, AS
AMENDED, BETWEEN THE AGENCY AND WATERMAN HOLDINGS,
LLC (4TH STREET AND WATERMAN AVENUE - APN: 0135-191-17)
(CENTRAL CITY EAST REDEVELOPMENT PROJECT AREA)
I HEREBY CERTIFY that the foregoing Resolution was duly adopted by the Community
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Development Commission of the City of San Bernardino at a j oint regular
day of December, 2008, by the following vote to wit:
meeting
9 thereof, held on the 15th
10 Commission Members:
11 ESTRADA
12 BAXTER
13 BRINKER
14 VACANT
15 KELLEY
16 JOHNSON
17 MCCAMMACK
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Abstain
Absent
Navs
Aves
X
X
X
X
X
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~<" Q2h,)
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Secretary
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The foregoing Resolution is hereby approved this 1/,11I day of December
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,2008.
25 Approved as to Form:
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27 By:
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Agency Co el
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CDC/2008-46
AMENDMENT NO.4 TO THE
2004
DISPOSITION AND DEVELOPMENT AGREEMENT
BY AND BETWEEN
REDEVELOPMENT AGENCY OF THE CITY OF SAN BERNARDINO
AND
WATERMAN HOLDINGS, LLC
(4th Street and Waterman Avenue Property)
This Amendment No.4 (this "Fourth Amendment") is dated as of December 15,2008, by
and between the Redevelopment Agency of the City of San Bernardino, a public body, corporate
and politic (the "Agency"), and Waterman Holdings, LLC, a California limited liability company
(the "Buyer" or "Developer"), and is an amendment to that certain 2004 Disposition and
Development Agreernent by and between the Agency and the Developer, dated as of December '
6, 2004, for the sale and purchase of certain Agency owned property located at the southwest
corner of 4th Street and Waterman Avenue the City of San Bernardino ("City") and within the
Central City East Redevelopment Project Area of the Agency (the "DDA" or "Agreement"), as
amended by that certain Amendment No. 1 to the DDA, dated June 20, 2005 (the "First
Amendment"), as amended by that certain Amendment No.2, dated June 19,2006 (the "Second
Amendment") and as amended by that certain Amendment No.3, dated July 21, 2008 (the
"Third Amendment"), by and between the Agency and the Buyer, and is entered into in light of
the facts set forth in the following Recital Paragraphs.
RECITALS
A. The Agency and the Buyer executed the DDA on December 6, 2004, wherein the
Buyer, without limitation, agreed to purchase certain land that the Agency owned at the
southwest corner of 4th Street and Waterman Avenue (the "Agency Property", formerly APN:
0135-191-11 and now APN: 0135-191-16 after and pursuant to the Lot Line Adjustment, as
defined below), in the City, County of San Bernardino (the "County"), State of California (the
"State"). The Agency and the Buyer executed the First Amendment to the DDA on June 20,
2005. The First Amendment modified the Agreement, to provide, without limitation, for the
transposition of the Phase I project and the Phase II project. The Agency and the Buyer executed
the Second Amendment to the DDA on June 19,2006. The Second Amendment modified the
DDA and the First Amendment, to provide, without limitation, for the elimination of the Phase I
and Phase II projects and was replaced by a single phase, two-story building of approximately
45,000 square feet of floor space, including the necessary and appropriate on-site improvements
and landscaping (the "Project").
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B. Pursuant to the Second Amendment, the Developer and the Agency, without
limitation, agreed to the following: (i) the Developer would purchase the Agency Property for
Five Hundred Twelve Thousand Four Hundred Twenty-Four Dollars ($512,424), (ii) the
Agency would reimburse the Developer a portion of the Agency Revenues (as defined in the
Agency Revenues Promissory Note (the "Note") attached as Exhibit "F" to the Second
Amendment) to be received by the Agency, in the manner provided therein and subject to the
terms, covenants and conditions of the Note, and (iii) the Developer would have a right of first
refusal on the "Flood Control Channel Property" (as defined in the Second Amendment).
C. After the approval and execution of the Second Amendment, the City added
additional requirements to the Project by requiring the Developer to construct certain off-site
improvements including, without limitation, new curbs, frItters and sidewalks along 4th Street
and Waterman Avenue and street repair/resurfacing on 4' Street along the front of the Project
(collectively, the "Off-Site Improvements"). Pursuant to the Third Amendment, the Agency
agreed to reimburse the Developer for the actual costs paid by the Developer to construct the
Off-Site Improvements or the surn of Three Hundred Ninety-Nine Thousand Five Hundred
Dollars ($399,500), whichever is less, in the manner provided for in the Third Amendment.
D. The legal descriptions of the Agency Property and the Flood Control Channel
Property were revised and amended by the Lot Line Adjustment No. LLA 08-01 (the "Lot Line
Adjustment"), recorded on June 12, 2008, as Instrument No. 2008-0268868, in the Official
Records of the County Recorder's Office for the County of San Bernardino, State of California.
Pursuant to the Lot Line Adjustment, APN: 0135-191-11 and APN: 0135-191-15 were amended
and became APN: 0135-191-16 and APN: 0135-191-17, respectively.
E. The Agency and the Developer wish to further amend the DDA, as amended by
the First Amendment, as amended by the Second Amendment and as amended by the Third
Amendment, pursuant to the terms, covenants and conditions of this Fourth Amendment.
F. Pursuant to this Fourth Amendment, the Agency and the Developer shall agree,
without limitation, to the following: (i) the Agency shall sell to the Developer, and the Developer
shall purchase from the Agency, the Flood Control Channel Property, for the sum of Thirty-Six
Thousand Dollars ($36,000), (ii) the legal description for the Agency Property and for the Flood
Control Channel Property shall be amended in accordance with and as revised by the Lot Line
Adjustment, and (iii) the Note shall be revised as provided for in the "Revised Agency Revenues
Promissory Note" attached hereto and to the DDA as Exhibit "F".
G. The Agency and the Buyer desire to approve and execute this Fourth Amendment
to the DDA upon the terms, covenants and conditions as set forth herein.
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NOW, THEREFORE, THE AGENCY AND THE BUYER DO HEREBY AGREE
AS FOLLOWS:
1. Section 1.01. PurDose of Al!reement. In Section 1.01 of the DDA, the following shall
be deleted from the end of the first section "the granting by the Agency to the Buyer of the First
Refusal Right, and the exercise by the Buyer of the First Refusal Right." and replaced with the
following "and the Flood Control Channel Property." Additionally, the second sentence of
Section 1.01 shall be deleted in its entirety and replaced with the following "The purchase and
development of the Agency Property and the Flood Control Channel Property are in the vital and
best interests of the City of San Bernardino (the "City") and the health, safety and welfare of its
residents, and is in accord with the public purposes and provisions of applicable state and local
laws."
2. Section 1.03. Benefit to Proiect Area. Section 1.03 of the DDA shall be deleted in its
entirety and replaced with the following: "The Agency has determined that the purchase and
developrnent of the Agency Property and Flood Control Channel Property by the Buyer, in
accordance with this Agreement, will materially assist in the elimination of blight and the
implementation of the Redevelopment Plan for the Project Area."
3. Section 1.06. Chanl!e in Manal!ement and Control of Buver - Assilmment and
Transfer. In Section 1.06(a)(1) of the DDA, the wording "and/or the Flood Control Channel
Property" shall be added immediately following the word "Property." In Section 1.06(a)(3) of
the DDA, the wording "and/or the Flood Control Channel Property" shall be added immediately
following the word "Property." In Section 1.06(a)(4) of the DDA, the word "Agency" shall be
added immediately preceding the word "Property" and the wording "and/or the Flood Control
Channel Property" immediately following the "Property."
4. Section 1.07. List of Attachments to Al!reement. As a result of the Lot Line
Adjustment which was necessary for the development of the Project, the legal descriptions and
assessor's parcel number for both the Agency Property and for the Flood Control Channel
Property have been changed. Accordingly, Exhibit "A", Exhibit "8", Exhibit "C", Exhibit "E"
and Exhibit "F" of the DDA, as revised by the First Amendment, by the Second Amendment and
by the Third Amendment, shall be deleted and replaced by the following Exhibits (which
Exhibits are attached hereto and incorporated herein by this reference):
Exhibit "A" "Revised Legal Description ofthe Agency Property"
Exhibit "B" "Revised Site Map of the Agency Property and the
Flood Control Channel Property"
Exhibit "C" "Revised Legal Description of the Flood Control Channel Property"
Exhibit "E" "Revised Improvements"
Exhibit "F" "Revised Agency Revenues Promissory Note"
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5. Section 1.08. No Recordation of Aereement: Survival. In line two (2) in Section 1.08
of the DDA, the word "Agency" shall be added immediately preceding the word "Property".
The wording "and/or the Flood Control Channel Property" shall be imrnediatdy added following
the word "Property", where appearing in Section 1.08 of the DDA.
6. Section 1.09. Flood Control Channel PropertY. Section 1.09 shall be added to the
DDA as follows: "The flood control channel consists of approximately 0.84 acres that is
presently aligned to the south of the Agency Property (the "Flood Control Channel Property").
The Buyer intends to purchase and to develop the Flood Control Channel Property as additional
parking for the Project. The Buyer shall be entitled to close escrow to acquire the Flood Control
Channel Property at anytime on or before April 30, 2009, unless such date is extended, in
writing, at the discretion of the Interim Executive Director for a total period oftime not to exceed
six (6) months without an amendment to this Agreement.
7. Section 2.01. ACQuisition and Disposition of the Property. In Section 2.01 of the
DDA, the word "Agency" shall be added irnmediately preceding the word "Property" and the
wording "and Flood Control Channel Property" shall be added immediately following the word
"Property", where appearing in the title. Additionally, the wording "and Flood Control Channel
Property" shall be added immediately following the word "Property", wherever found in this
Section.
8. Section 2,02. Conditions for Transfer of the Aeencv PropertY. In Section 2.02(a) and
Section 2.02(b) of the DDA, the wording "and Flood Control Channel Property" shall be added
immediately following the word "Property", where appearing in the title. Section 2.02(c) shall
be added to the DDA as follows: "The Flood Control Channel Property shall be transferred to the
Buyer at the Close of Escrow provided that within the periods of time set forth in this Agreement
(i) neither party has terminated this Agreement, (ii) the Buyer has delivered to the Agency the
Due Diligence Certificate in connection with the Flood Control Channel Property regarding
Section 2,11 and (iii) all other conditions of the Close of Escrow in connection with the Flood
Control Channel Property set forth in this Agreement have been met and the escrow costs
relating to the Close of Escrow have been paid by the appropriate party." Section 2.02(d) shall
be added to the DDA as follows: "The parties shall deliver jointly, approved written escrow
instructions (consistent with the terms of this Agreement) to the Escrow Holder for transfer of
the Flood Control Channel Property, as soon as reasonably possible."
9. Section 2.03. Purchase Price. The Purchase Price for the Flood Control Channel
Property shall be Thirty-Six Thousand Dollars ($36,000) (the "Flood Control Channel Property
Purchase Price").
10. Section 2.04. Openine of Escrow. Section 2.04(c) shall be added to the DDA as
follows: "The transfer and sale of the Flood Control Channel Property shall take place through
Escrow to be administered by the Escrow Holder. The Escrow for the Flood Control Channel
Property shall be deemed open (the "Opening of Escrow") upon receipt by the Escrow Holder of
a fully executed copy of the Agreement, the First Amendment, the Second Amendment, the
Third Amendrnent and this Fourth Amendment. The Escrow Holder shall promptly confirm to
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the parties the escrow number and the title insurance order number assigned to the Escrow for
the Flood Control Channel Property with the Escrow Holder."
11. Section 2.06(a). Convevance of Title. In Section 2.06(a) of the DDA, the wording
"and Flood Control Channel Property" shall be added immediately following the wording
"Agency Property", where appearing in this Section. Additionally, Section 2.06(a)(3) shall be
amended as follows: "(3) the Redevelopment Plan (existing as of the date of the Fourth
Amendment)."
12. Section 2.07. Additional Closinl! Oblil!ations of Al!encv. In Section 2.07 of the DDA,
the wording "and/or Flood Control Channel Property" shall be added immediately following the
wording "Agency Property", where appearing in this Section.
13. Section 2.08. CIosinl! ObIil!ations of Buver. In Section 2.08 of the DDA, the wording
"and/or Flood Control Channel Property" shall be added immediately following the wording
"Agency Property", where appearing in this Section.
14. Section 2.09. Environmental Law. In Section 2.09 of the DDA, the wording "and/or
the Flood Control Channel Property" shall be immediately added following the word "Agency
Property", where appearing in this Section.
15. Section 2.10. Due DiIil!ence Investil!ation of the Al!encv ProDertv. In the section
heading for Section 2.10 of the DDA, the wording "and/or Flood Control Channel Property"
shall be added immediately following the wording "Agency Property." In Section 2.10(a) of the
DDA, the wording "and/or Flood Control Channel Property" shall be added immediately
following the wording "Agency Property". In Section 2.10(b) and (c) the wording "and/or the
Flood Control Channel Property" shall be added immediately following the wording "Agency
Property." In Section 2.10(d) of the DDA, the word "Agency" shall be added immediately
preceding the word "Property" and the wording "and/or the Flood Control Channel Property"
shall be added immediately following the word "Property." In Section 2.10(e) of the DDA, the
wording "and/or the Flood Control Channel Property" shall be added immediately following the
wording "Agency Property."
16. Section 2.11. Due Dilil!ence Certificate. In Section 2.11, Section 2.1 1 (a) and Section
2.1 I (b) of the DDA, the wording "and/or Flood Control Channel Property" shall be added
immediately following the wording "Agency Property", where appearing in this Section.
17. Section 2.12. Books and Records. In line three (3) of Section 2.12 of the DDA, the
words "respective portion of the" shall be deleted. Additionally, the wording "and/or Flood
Control Channel Property" shall be added immediately following the wording "Agency
Property", where appearing in this Section.
18. Section 2.13 Condition of the ProDertv. In Section 2.13 of the DDA, the wording
"and/or Flood Control Channel Property" shall be added immediately following the wording
"Agency Property", where appearing in this Section.
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19. Section 2.14. Review and AoorovaI of Condition of Title. In Section 2.14(a) and
Section 2.14(b) of the DDA, the wording "and/or Flood Control Channel Property" shall be
added irnmediately following the wording "Agency Property", where appearing in this Section.
20. Section 2.15. SoeciaI Provisions AooIicabIe to the Close of Escrow for the Flood
Control Channel ProDertv.
The parties recognize that the Flood Control Channel Property is subject to the jurisdiction of the
United States Army Corps of Engineers (the "Corps of Engineers") as the Flood Control Channel
Property was a formerly designated water course of the United States, and as such the Developer
will be required to obtain the issuance of certain permits and discretionary approvals from the
Corps of Engineers. In addition to compliance by the Developer with the requirements of
Sections 2.02, 2.07, 2.1 0, 2. I I, 2.13 and 2.14 as amended by Amendment No.4 to this DDA, the
Escrow for the sale of the Flood Control Channel Property from the Agency to the Developer
shall not occur until there has been full compliance by the Developer with the following special
provisions applicable to the Flood Control Channel Property as such compliance shall be
determined by the Interim Executive Director of the Agency with the concurrence of the Director
of Development Services ofthe City, each at their sole and absolute discretion:
(i) The City through the Development Services Department has completed all
environmental reviews and assessments as deemed appropriate by the City pursuant
to both CEQA and NEP A, as applicable, for the intended use by the Developer of the
Flood Control Channel Property for an at-grade parking structure; and
(ii) The Developer has agreed to all mitigation measures for the Flood Control Channel
Property as shall be contained in the final CEQA and NEP A reviews and
determinations of the intended scope of development of the Flood Control Channel
Property as an at-grade parking structure; and
(iii) The City has received adequate written, binding and enforceable assurances from the
Developer that the Developer will in fact comply with all mitigation measures as
identified in the CEQA and NEP A reviews and approvals for the development of the
Flood Control Channel Property as an at-grade parking structure; and
(iv) All applicable permits and approvals have been issued by the Corps of Engineers and
all other federal, state and local governmental agencies having jurisdiction as to the
intended use and development of the Flood Control Channel Property as such
sufficiency as to the issuance of permits and approvals shall be determined by the
Director of Development Services; and
(v) The D/ERC has approved the development of the Flood Control Channel Property as
an at-grade parking structure and has imposed conditions of approval for the
development and use thereof by the Developer consistent with the intended uses, and
all City permits have been issued and approvals granted to allow for the development
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by the Developer of the at-grade parking structure improvements upon the Flood
Control Channel Property; and
(vi) The Developer has entered into a "Defense, Indemnification and Hold Harmless
Agreement" with the City in such form and content acceptable to the City, and
subject to approval by the Mayor and Common Council at a public meeting, whereby
the Developer has agreed to defend, indemnifY and hold harmless the City, the
Agency and all elected officials, appointed officers and staff and consultants of the
City and the Agency frorn all losses and damages that may be suffered as the result of
the use of the Flood Control Channel Property by the Developer, including, but not
limited to, the injury or loss of life and property damage from water flows, flood
waters and debris flows and debris blockages that cause flooding or water damages to
any other property or result in any other damages, injury or loss of life and Agency to
maintain general liability insurance in the amount of$3,000,000; and
(vii) The Developer has entered into a "Maintenance and Operation Agreement" with the
City in such form and content acceptable to the City, and subject to approval by the
Mayor and Common Council at a public meeting, whereby the Developer has agreed
to maintain the Flood Control Channel Property and the improvements to be
constructed within and above the Flood Control Channel Property in such condition
as shall be determined by the City Engineer to be required from time-to-time; such
Maintenance and Operation Agreement shall also permit but not require the City to
enter into the Flood Control Channel Property and to conduct routine testing and
observations to assure compliance with all applicable permits and other laws
applicable thereto and consistent with the CEQA and NEP A mitigation measures and
all other permits and approvals as issued by any other federal, state or local
governmental agencies having jurisdiction over the Flood Control Channel Property;
furthermore, the City shall be permitted but not required to enter into and upon the
Flood Control Channel Property and to undertake all maintenance activities as shall
be reasonably determined by the City Engineer as necessary under the circumstances
and shall have the right to impose an enforceable lien upon the other property
identified in Amendment No.3 to this DDA as the Agency Property and the Project
as may be then in the ownership of either the Developer or any other successor in
interest to recover all costs of such maintenance activities. The provisions of Section
2.15 shall survive the termination of this DDA and shall be a covenant that shall run
with the land and shall be binding on all successors and assignees of Waterman
Holdings, LLC.
21. Section 3.01. Uses. In Section 3.01 of the DDA, the wording "and the Flood Control
Channel Property" shall be added immediately following the wording "Agency Property", where
appearing in this Section.
22. Section 3.02. Modification of Covenants. In Section 3.02(a), Section 3.02(b), Section
3.02(c) and Section 3.02(d) of the DDA, the wording "and/or Flood Control Channel Property"
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7
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shall be added immediately following the wording "Agency Property", where appearing in this
Section.
23. Section 3.03. ObIi2ation to Refrain from Discrimination. In Section 3.03 of the
DDA, the wording "and/or the Flood Control Channel Property" shall be added immediately
following the wording "Agency Property", where appearing in this Section.
24. Section 3.05. No Liability for Breach to a Predecessor in Interest. In Section 3.05 of
the DDA, the wording "and/or the Flood Control Channel Property" shall be added immediately
following the wording "Agency Property", where appearing in this Section.
25. Section 3.06. A2encv Ouit Claim Deed. Section 3.06 of the DDA shall be deleted in
its entirety and replaced with the following: "All of the provisions in Sections 3.01 to 3.05,
inclusive, shall be included in the Agency Quit Clairn Deed for the Agency Property and the
Flood Control Channel Property. Accordingly, Sections 3.01 to 3.05, inclusive, shall survive the
Close of Escrow."
26. Section 3.07. Maintenance Condition of the A2encv ProDertv. In the heading for
Section 3.07 of the DDA, the wording "and Flood Control Channel Property" shall be added
immediately following the wording "Agency Property." In Section 3.07(a) and Section 3.07(b)
of the DDA, the wording "and/or the Flood Control Channel Property" shall be added
immediately following the wording "Agency Property", where appearing in Section 3.07(a) and
Section 3.07(b).
27. Section 3.08. PIed2e of A2encv Revenues to Buver. In Sections 3.08(a), 3.08(e) and
3.08(f) of the DDA, the word "Revised" shall be added immediately preceding the wording
"Agency Revenues Promissory Note." Additionally, the wording "and Flood Control Channel
Property" shall be added immediately following the wording "Agency Property", where
appearing in Section 3.08(a), Section 3.08(b), Section 3.08(c), Section 3.08(d) and Section of
3.08(e) of the DDA.
28. Section 3.10. DeveIoDer First Refusal Ri2ht. Section 3.10 of the DDA shall be
deleted, in its entirety.
29. Section 4.01. Defaults and Remedies. In Section 4.0I(c) and Section 4.01(g) of the
DDA, the wording "and the' Flood Control Channel Property" shall be added immediately
following the wording "Agency Property".
30. Section 5.02. Conflict of Interest. In Section 5.02 of the DDA, the wording "and/or
Flood Control Channel Property" shall be added immediately following the wording "Agency
Property", where appearing in this Section.
31. Section 5.05. Enforced Delav: Extension of Time of Performance. In line ten (IO) in
Section 5.05(b) of the DDA, the word "Agency" shall be added immediately preceding the word
"Property" and the wording "and/or the Flood Control Channel Property" shall be added
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8
CDC/2008-46
immediately following the wording "Agency Property." In line nine (9) in Section 5.05(c) of the
DDA, the word "Agency" shall be added immediately preceding the word "Property" and the
wording "and/or the Flood Control Channel Property" shall be added immediately following the
wording "Agency Property."
32. Section 5.06. InsDection of Books and Records. In Section 5.06 of the DDA,the
wording "and/or Flood Control Channel Property" shall be added immediately following the
wording "Agency Property", where appearing in this Section.
33. Section 5.13. Entire Al!reement. The Agreement, as amended by the First Amendment,
as amended by the Second Amendment, as amended by the Third Amendment and as amended
by this Fourth Amendment constitutes the entire understanding and agreement between the
parties with respect to the Agency Property and the Flood Control Channel Property.
34. Section 5.14. Intel!ration. In Section 5.14 of the DDA, the wording "and Flood Control
Channel Property" shall be added immediately following the wording "Agency Property", where
appearing in this Section.
35. Exhibit Headings. The following Exhibit headings shall be modified as set forth below:
Exhibit "A". Exhibit "A" shall be amended as follows:
"REVISED LEGAL DESCRIPTION FOR THE AGENCY PROPERTY"
Exhibit "B". Exhibit "B" shall be amended as follows together with the inclusion of a
new Site Map for the Agency Property and the Flood Control Channel Property:
"REVISED SITE MAP FOR THE AGENCY PROPERTY AND FOR THE FLOOD
CONTROL CHANNEL PROPERTY"
Exhibit "C". Exhibit "C" shall be amended as follows:
"REVISED LEGAL DESCRIPTION OF THE FLOOD CONTROL CHANNEL
PROPERTY"
Exhibit "E". Exhibit "E" shall be amended as follows:
"REVISED IMPROVEMENTS"
Exhibit "F". Exhibit "F" shall be amended as follows:
"REVISED AGENCY REVENUES PROMISSORY NOTE"
36. Lel!al Effect. The DDA, the First Amendment, the Second Amendment and the Third
Amendment shall only be amended to the extent set forth herein. All other terms, covenants
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andlor conditions of the DDA, the First Amendment, the Second Amendment and the Third
Amendment, unless specifically amended or modified by the terms, covenants and/or conditions
of this Fourth Amendment, shall remain unmodified and in full force and effect. In the event of
any inconsistency, contraction and/or ambiguity between the terms, covenants and conditions of
this Fourth Amendment, and the DDA and/or the First Amendment and/or the Second
Amendment and/or the Third Amendment, the inconsistency, contraction and/or ambiguity shall
be resolved in favor of the terms, covenants and conditions set forth in this Fourth Amendment.
37. Dermed Terms. Terms not otherwise defined or redefined in this Fourth Amendment
shall have the meanings provided for in the Second Amendment.
38. Effective Date. This Fourth Amendment shall take effect from and after the date of final
approval hereof by the governing body of the Agency at a duly held joint public hearing and
after the execution of this Fourth Amendment by the Agency and the Buyer.
III
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.
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CDC/2008-46
IN WITNESS WHEREOF, the parties have signed this Fourth Amendment as of the date
firs! set forth above.
AGENCY
Redevelopment Agency of the City of San Bernardino,
a public body, corporate and politic
Dated: :L/t'l! 09
By:
Emil A. Marzullo, Interim Executive Director
~~
Approved as to Form and Legal Content:
By: Cr~
Agency C e
DEVELOPER
Waterman Holdings, LLC,
a California' .
Dated:~
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Exhibit" A"
Revised Legal Description of the Agency Property
APN: 0135-191-16
IIWtOm. 'OF fWIat wr NO. .l'~ L.()CI....ItH em' Of 1M
RJIiI,lII.fllEilIlAMNIt ....~ llllOOM.... 1'1\1' J'" ......
PMJIII MIll. ~ OF 'Ufl CCklH'fVeFlM 1I111VL.'1Il1l1O..,..-.
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nea lEA\IING s.uo \1'1&$1 UNE SOOTH "'18'$1" EAST 11$.11;
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8M'! fdftHL"to THlICM..ImWE$T OOAHERtJF .SA1D.PAR.CEL 1.MD THE
POiIH'f OF 1EGIMHlHG.
P:\AgendaslAgenda AttachmentslAgrmts-Amend 2008\12-15-08 Walennan Holdings, LLC - Amendment No, 4,doc
12
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Exhibit "B"
Revised Site Map of the Agency Property the Flood Control Channel Property
P:lAgendaslAgenda AttachmentslAgnnts-Amend 2008\12-1S~8 Watennan Holdings, LLC - Amendment No, 4,doc
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Exhibit "C"
Revised Legal Description of the Flood Control Channel Property
APN: 0135-191-17
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AU'IO..... THE ~$TeoN_OF ......PAftCElI;
T~.P<<JftTH 00"01'14" EAST '..l'O fRT ALONG THE WESt LN.OF.SAIO
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l"HEHOE lEAVING $M) WEST lItE 80IJJH W-M'$'" EAST 215....;
~.JOUTH ..~24.tl" eAST :MO.. TO A.PCMr ON THE SOOtWUNE or:
SAID PMOEl1,SAlOSOU1'H UHE IlElHB M NORTH UHf OF SM) P~';
llotEHGE .$OU1l1....'04' WEST ~:n FiET N..QttG .~.S9Ull1 LlNJ~
SAlO tUU'H .....TO THE SO\1fHWUT COflINER OF SAID pARCeL '.IHJ THE
P04MT OF _GtUNlNG.
P:\AgendaslAgenda AltachmentslAgnnts.Amend 2008\12-15.08 Watennan Holdings. LLC - Amendment No, 4.doc
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Exhibit "D"
Form of Agency Quitclaim Deed
[NO CHANGES MADE]
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CDC/2008-46
Exhibit "E"
Revised Improvements
The Improvement on the Agency Property shall consist of approximately a 2-story, 45,000
square foot office building of concrete tilt-up or concrete block construction with sufficient
parking spaces to comply with both City ordinances and the County Lease Agreement. The
building will include full tenant improvements as required for the County Lease Agreement for
use by the County of San Bernardino, Transitional Assistance Department, and the tenant.
The Improvement of the Flood Control Channel Property shall consist of a single floor structure
built above the Flood Control Channel Property to provide additional parking spaces for the 2-
story, 45,000 square foot building. The construction, landscaping, etc., of the single floor
parking structure shall comply with the City's Development Code and requirements from any
federal and/or state governmental agency, concerning improvements to and/or near flood control
channel land, that may be imposed on the Developer.
I
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,I
CDC/2008-46
Exhibit "F"
Revised Agency Revenues Promissory Note
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CDC/2008-46
REVISED AGENCY REVENUES PROMISSORY NOTE
Date: July _' 200_
Los Angeles, California
The undersigned, the Redevelopment Agency of the City of San Bernardino, a public agency
(the "Agency"), prornises to pay, and pledges to Waterman Holdings, LLC, a California limited
liability company (the "Buyer"), or the Buyer's assignee, one or more principal advances of a
portion of the Agency Revenues (as that term is defmed below) due and owing by the Agency to the
Buyer in accordance with and pursuant to the terms, covenants and conditions of this Revised
Agency Revenues Prornissory Note (the ''Note'') and the Agreement (as that term is defined in this
Note), together with interest on the unpaid principal balance thereof, at the Interest Rate (as that term
is defmed in this Note), in lawful money of the United States, with the then outstanding principal
balance thereof, all accrued and unpaid interest, late charges, fees, and all other amounts due and
owing under this Note being due and payable by the Agency to the Buyer on the Maturity Date (as
defmed in this Note). The principal, interest, late charges, fees and all other amounts due under this
Note are payable by the Agency to the Buyer at 4221 Wilshire Boulevard, Suite 240, Los Angeles,
California 90010.
This Note shall be subject to the following terms, covenants and conditions:
1. Defmitions. The initially capitalized terms defmed herein shall have the following meanings
where appearing in this Note. Otherwise, any initially capitalized term (not defined herein) shall
have the meaning provided for in the Second Amendment (as defined below).
1.1 A2reement. The "Agreement" shall mean the Original Agreement (as defined
below), as amended by the First Amendment (as defined below), as further amended by the Second
Amendment (as defmed below), as further amended by the Third Amendment (as defined below)
and as further amended by the Fourth Amendment (as defined below), as executed by and between
the Agency and the Buyer, and all exhibits attached thereto.
1.2 Certificate of Occuoancv. The "Certificate of Occupancy" shall mean the
Certificate of Occupancy issued by the City to the Buyer in connection with the development,
construction and installation of the improvements at the Agency Property (as that term is defined in
the Second Amendment) and at the Flood Control Channel Property.
1.3 City. The "City" shall mean the City of San Bernardino.
1.4 County. The "County" shall mean San Bernardino County.
lof7
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.1.5 First Amendment. The "First Amendment" shall mean that certain Amendment No.
1 to the Original Agreement, dated June 20, 2005, as executed by and between the Agency and the
Buyer.
1.6 Fourth Amendment. The "Fourth Amendment" shall mean that certain Amendment
No.4 to the Original Agreement, dated December 15, 2008, as execl.lted by and between the Agency
and the Buyer.
1. 7 Fiscal Year. The "Fiscal Year" shall mean any given fiscal year for the County.
1.8 Initial Fiscal Year. The "Initial Fiscal Year" shall mean the first (I SI) Fiscal Year
following the Fiscal Year in which the City issued the Certificate of Occupancy.
1.9 Interest Rate. The "Interest Rate" shall mean five percent (5%) per annum which
shall only apply to late payments remitted by the Agency to the Buyer and such Interest Rate shall
not be calculated upon the unpaid Principal balance of this Note, and shall accrue in the manner
provided for in Section 3(b) of this Note.
1.1 O. Late ChaNe. The "Late Charge" shall mean three percent (3%) on the payment due
and owing by the Agency to the Buyer under this Note (subject to any applicable cure period(s) in
this Note and/or the Agreement).
1.11 Maturity Date. The "Maturity Date" shall mean the first business day following the
expiration of the Term.
1.12 OritzinaI Atzreement. The "Original Agreement" shall mean that certain 2004
Disposition and Development Agreement, dated December 6, 2004, as executed by and between the
Agency and the Buyer.
1.13 PrinciDal. The "Principal" shall mean one or more principal advances, in the
aggregate, of a portion of the Agency Revenues due and owing by the Agency to the Buyer in
accordance with and pursuant to the terms, covenants and conditions of this Note and the
Agreement, as increased, decreased and adjusted from time-to-time. As of the date of this Note,
there is no discernable method to calculate the total Principal amount that may be payable by the
Agency to the Buyer pursuant hereto.
1.14 Second Amendment. The "Second Amendment" shall mean that certain
Amendment No.2 to the 2004 Disposition and Development Agreement Waterman Holdings, LLC
th
(4 and Waterman Property), dated June 19, 2006, as executed by and between the Agency and the
Buyer.
1.15 I!:!:m. The "Term" shall mean the term of this Note commencing on the date of
execution of this Note and continuing thereafter until the end of the tenth (10th) Fiscal Year (with
the Initial Fiscal Year being the first Fiscal Year of this ten (I O)-year Fiscal Year period). This Note
has been duly executed and delivered as of July I the next succeeding Fiscal Year of the Agency
20f7
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during which the Buyer has obtained a Certificate of Occupancy from the City of San Bernardino for
the project described in the Original Agreement, as amended.
1.16 Third Amendment, The "Third Amendment" shall mean that certain Amendment
No.3 to the Original Agreement, dated as of July 21,2008, by and between the Agency and the
Buyer.
2. Interest. Interest shall not be paid on the Principal balance of this Note but shall be paid only
upon a default or other late payment by the Agency as provided in this Note. Subject to Section 3(b)
of this Note, interest on the unpaid Principal under this Note will accrue at the fixed annual Interest
Rate until paid in full by the Agency to the Buyer. Interest shall be computed based on a 36S-day
year and the actual number of days elapsed.
3. Payment of Principal. Interest and Late ChaNe. (a) The Agency hereby pledges to
the Buyer certain revenues of the Agency attributable to sources of funds that are legally available to
the Agency in each fiscal year during the term of such pledge (the "Agency Revenues") in an
amount based upon the Index as hereinafter defmed. The Index for the calculation of the dollar
amount of the Agency Revenues to be remitted in each fiscal year to the Buyer shall be on the basis
of (A) sixty percent (60%), multiplied by (B) the one percent (1 %) general property taxes, exclusive
of any override taxes, special taxes, ad valorem taxes for general obligation bonded indebtedness or
other special assessments, that are actually paid by the Buyer and/or the Buyer's successor-in-
interest to the ownership of the Agency Property and of the Flood Control Channel Property
attributable to the development to occur on the Agency Property and on the Flood Control Channel
Property pursuant to this Agreement (such 60% of the 1 % of the real property taxes as actually paid
by the Buyer and/or Buyer's successor-in-interest to the ownership of the Agency Property and of
the Flood Control Channel Property to the County is herein referred to as the "Index").
(b) The payments of the Agency Revenues shall commence in the fiscal year next
succeeding the fiscal year in which the Buyer receives a Certificate of Occupancy for the
development of the Agency Property and the Flood Control Channel Property and continuing for a
total often (10) fiscal years thereafter with the Initial Fiscal Year commencing as of the fiscal year
following the fiscal year in which a Certificate of Occupancy is so issued by the City for the
development of the Agency Property and of the Flood Control Channel Property. Such payments
shall be remitted by the Agency to the Buyer within thirty (30) calendar days after the Buyer has
provided written documentation to the Agency that the applicable property taxes on the Agency
Property and on the Flood Control Channel Property as of each December 10 and/or April 1 0 (or any
other delinquency date established by the County for the payment of supplemental property taxes)
have been duly paid. The Buyer shall provide to the Agency, a copy of the property tax bill and a
copy of the cancelled check illustrating payment of the appropriate real property tax amount. The
Agency shall within thirty (30) calendar days after receipt of the documentation required by this
Section, remit the appropriate payment of the Agency Revenues based upon the Index to the Buyer.
Any failure of the Agency to dispute in writing the adequacy of the documentation as submitted by
the Buyer within the applicable 30-day period of time, shall constitute approval of same by the
Agency. The Agency shall be obligated to provide written notice to the Buyer within said 30-day
period of time, as to any inadequacy of any documentation provided by the Buyer to the Agency.
Failure of the Agency to remit the requested payment of the Agency Revenues within ten (10)
30f7
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calendar days after the expiration of the initial 30-day period for review of the documentation as
submitted, unless notice has been provided by the Agency to the Buyer in the manner as provided
above, shall subject the Agency to a three percent (3%) late charge on the amount owed and interest
at the rate offive percent (5%) per annum calculated on the number of days from the due date of the
applicable payment until such amount has been paid to the Buyer.
(c) It shall be a condition precedent to each payment of the Agency Revenues
hereunder that as of each such Agency Revenues payment due date there has been no Transfer (as
defmed in the Agreement), assignment, or sale or other conveyance of the Agency Property or of the
Flood Control Channel Property or any interest in the Agreement which is prohibited by the
Agreement.
(d) In the event that the Buyer should Transfer any interest in the Agreement, this
Note and/or the Agency Property and/or the Flood Control Channel Property in violation of the
Agreement or this Note, or sell the Agency Property and/or the Flood Control Channel Property in
violation of the Agreement or this Note, prior to the expiration of the applicable ten-year period for
the receipt of the Agency Revenues, the obligation of the Agency for any further remittances of the
Agency Revenues shall immediately cease and terminate as to that portion of the Agency Property
and/or of the Flood Control Channel Property to which such prohibited Transfer or other sale or
conveyance has occurred.
(e) Notwithstanding anything herein to the contrary, upon the issuance of a
Certificate of Occupancy by the City for the Agency Property and/or for the Flood Control Channel
Property, any of the following transactions shall not be deemed a "Transfer" prohibited by the
Agreement or this Note: (i) the transfer of fee title to the Agency Property and/or to the Flood
Control Channel Property to any entity in which an entity directly or indirectly, majority-owned and
controlled by Jian Torkan, is the general partner or managing member or partner, (ii) a transfer offee
title to the Agency Property and/or to the Flood Control Channel Property in a transaction in which
the Buyer enters into a lease for the Agency Property and/or for the Flood Control Channel Property
pursuant to which it is obligated to pay all property taxes, or (iii) a transfer to any entity which is
directly or indirectly majority-owned and controlled by Jian Torkan. On and after the issuance of the
Certificate of Occupancy as specified above and for a period oftime equal to ten (I 0) years after the
date of the issuance of the Certificate of Occupancy, and in addition to the ability of the Buyer to
enter into a transaction that is deemed not to be a Transfer as defined above, the Buyer may sell,
transfer or assign the Agency Property and/or the Flood Control Channel Property, the Agreement
and this Note to any other person or entity subject to the following: (i) such subsequent owner of the
Agency Property and/or of the Flood Control Channel Property has assumed in writing all duties and
obligations of the Buyer as contained in the Agreement and this Note in form and substance as may
be reasonably required by the Agency General Counsel and (ii) the subsequent owner has assumed
all Agency Property and/or Flood Control Channel Property maintenance, covenants and obligations
set forth in the Agreement, or in any other document mutually executed by Buyer and the Agency.
Following the ten (10) year period referred to above, there shall be no restriction or condition to any
sale of transfer by the Buyer of the Agency Property and/or of the Flood Control Channel Property
and/or the Buyer's interest in this Agreement. Following the expiration of the Term, the Agency
shall have no further duty or obligation to make any payment of the Agency Revenues, or any
portion thereof, to the Buyer or to any successor-in-interest in the ownership of the Agency Property
and/or of the Flood Control Channel Property (except for the Agency Revenues and/or any other
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amounts due and owing by the Agency to the Buyer under this Agreement). Notwithstanding
anything herein to the contrary, any transfer of the Agency Property and/or of the Flood Control
Channel Property and/or the Buyer's interest in the Agreement and in this Note pursuant to a
foreclosure or deed-in-Iieu thereof shall not constitute a prohibited Transfer.
(t) The Buyer shall have all rights and remedies against the Agency pursuant to
the laws of the State of California and as further set forth in this Agreement and in this Note. Any
failure of the Agency to remit the timely payments of the Agency Revenues to the Buyer shall be
deemed to be a default hereof for which the Buyer shall be entitled, after delivery of the notice or
otherwise as set forth in this Note, to be reimbursed for all costs and expenses of the collection of
any dollar amount that is then due and payable by the Agency to the Buyer from the Agency
Revenues.
4. Preoavment. This Note may be prepaid by the Agency, at any time, in whole or in part,
without premium or penalty, as long as any principal prepayment is accompanied by a payment of
interest accrued to the date of prepayment on the amount prepaid, but only if interest is payable due
to a prior payment default by the Agency, and any and all late charges or other amounts then owed
by the Agency hereunder.
5. AooIication of Pavments. Each payment under this Note shall be credited frrstto any late
charges and fees (including, without limitation, attorneys' fees and costs), all accrued and unpaid
interest, if any, and then to Principal then due and payable under this Note.
6. Maturitv Date. On the Maturity Date, the Agency shall pay to the Buyer the then
outstanding Principal balance, all accrued and unpaid interest, late charges, fees, and all other
amounts (including, without limitation, attorneys' fees and costs) then due and payable under this
Note.
7. Condition Precedent. The Agency shall have no duty or obligation to execute, deliver or
perform under this Note until all conditions precedent provided for in this Note and the Agreement
have been fully performed and satisfied by or for the Buyer or have been expressly waived in writing
by the Agency.
8. Notice. Any notice required to be provided in this Note shall be given in writing and shaII be
sent (i) for personal delivery by a delivery service that provides a record of the date of delivery, the
individual to whom delivery was made, and the address where delivery was made; (ii) by first-class
certified United States mail, postage prepaid, return receipt requested; or (iii) by a nationally
recognized overnight courier service, marked for next day business delivery. All notices shall be
addressed to the party to whom such notice is to be given at the address stated below or to such other
address as a party may designate by written notice to the other. All notices shall be deemed effective
on the earliest of (a) actual receipt; (b) rejection of delivery; ( c) if sent by certified mail, the third day
on which regular United States mail delivery service is provided after the day of mailing or, if sent
by overnight delivery service, on the next day on which such service makes next business day
deliveries after the day of sending. The address for the Agency and for the Buyer shall be as
follows, subject to any written notice of a change of address by one party to the other:
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Address for the Agency:
Redevelopment Agency of the City of San Bernardino
Attention: Interim Executive Director
20 I North "E" Street, Suite 30 I
San Bernardino, CA 92401
Address for the Buyer:
Waterman Holdings, LLC
Attention: Jian Torkan
4221 Wilshire Boulevard, Suite 240
Los Angeles, CA 900 I 0
9. Default. Subjectto Section 7 of this Note, and any applicable cure period(s) provided for in
this Note and/or in the Agreement, a default shall occur whenever the Agency fails to pay to the
Buyer any sum due under this Note when it becomes due and payable, or (b) any breach of any other
promise or obligation in this Note, the Agreement or any other instrument, document and/or
agreement, now or hereafter, evidencing, securing, guaranteeing, hypothecating, relating to, or in
connection with, the transaction contemplated in the Agreement and/or this Note (collectively, a
"Default"). Upon the occurrence of a Default, the Buyer may, at its option, declare this Note
(including, without limitation, all principal, all accrued and unpaid interest, late charges, attorneys'
fees and costs) to be immediately due and payable, regardless of its Maturity Date, subject to the
cure periods provided for in this Note and/or the Agreement (collectively, the "Default Payment
Amount"), and the Agency shall immediately pay to the Buyer the Default Payment Amount.
10. Unsecured Promissorv Note. This Note is unsecured, and is not secured by any real or
personal property of any nature whatsoever.
II Modification. This Note may not be modified, amended, waived or extended, changed,
discharged or terminated orally or by any act on the part of the Agency or of the Buyer, but only by
an agreement in writing signed by the Agency and the Buyer.
12. Headin!!:s. The headings of this Note are for purposes of reference only and shall not limit or
otherwise affect the meaning thereof.
13. Interoretation. Common nouns and pronouns shall be deemed to refer to the masculine,
feminine, neuter, singular and plural, as the identity of the person or entity may in the context
require.
14. Goveroin!!: Law. This Note shall be governed by and construed in accordance with the laws
of the State of California.
15. Judicial Proceedinl!S and Attornevs' Fees. If either party hereto files any action or brings
any action or proceeding against the other arising out of this Note, then as between the Buyer 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. The costs, salary and
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expenses of the City Attorney for the City and members of his office in enforcing this Note shall be
considered as "attorneys' fees" for purposes of this Section. Any such action or proceeding must be
commenced in the Superior Court for the County of San Bernardino, San Bernardino District, State
of California
16. Enforcement Costs. All reasonable out-of-pocket costs incurred by the Buyer in the
enforcement of this Note shall be added to the amounts due under this Note.
17. Assil!Dment. This Note may be assigned by the Buyer, subject to the restrictions and
limitations provided forin Section 3.08( c), 3 .08( d) and 3.08( e) of this Note and by the Agency, but
no such assignment shall relieve the Agency from any of its obligations or liabilities hereunder. The
terms, covenants and conditions of this Note shall be binding upon, and inure to the benefit of, the
successors and assigns of the Buyer (subject to the restrictions and limitations provided for in
Section 3.08(c), 3.08(d), and 3.08(e)ofthis Note) and of the Agency.
IN WITNESS WHEREOF, the Agency has executed this Agency Revenues Promissory
Note as of the date first written above.
AGENCY
Redevelopment Agency of the City of San Bernardino
a public agency
By:
Emil A. Marzullo, Interim Executive Director
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