HomeMy WebLinkAboutR25- Economic Development Agency CITY OF SAN BERNARDINO ORIGINAL
ECONOMIC DEVELOPMENT AGENCY
FROM: Emil A.Marzullo SUBJECT: In-N-Out Burger, Inc., a California corporation
Interim Executive Director — Redevelopment Project Study and Exclusive
Right to Negotiate Agreement (Central City
North Redevelopment Project Area)
DATE: February 8,2010
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Synopsis of Previous Commission/Council/Committee Action(s):
On January 21, 2010, Redevelopment Committee Members Baxter and Brinker unanimously voted to recommend that the
Community Development Commission consider this action for approval.
--------------------------------------- ----------------------- -----------------
Recommended Motion(s):
(Community Development Commission)
Resolution of the Community Development Commission of the City of San Bernardino approving and authorizing
the Interim Executive Director of the Redevelopment Agency of the City of San Bernardino("Agency")to execute a
Redevelopment Project Study and Exclusive Right to Negotiate Agreement by and between the Agency and In-N-
Out Burger, Inc., a California corporation, concerning Agency owned property located at the southeast corner of 5d,
and"H" Streets(Central City North Redevelopment Project Area)
--------------- -----------------------------------------------------------------------------------------------
Contact Person(s): Mike Trout Phone: (909)663-1044
Central City North Redevelopment
Project Area(s): Project Area Ward(s): 1"
Supporting Data Attached: IZ Staff Report 0 Resolution(s)0 Agreement(s)/Contract(s)0 Map(s)❑Letter(s)
FUNDING REQUIREMENTS: Amount: S -0- Source: N/A
Budget Authority: N/A
Signature: Fiscal Review.
Emil A.Marzullo,rn xecutive Director u eJesus, terim dministrative Services Director
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Commission/Council Notes: C.S ��C�O/O
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P:NgaMuW=mMvCommivuon\C DC201=3 41-101n-N4>ABuga,I=.(MO)-ERN ASr ntdm COMMISSION MEETING AGENDA
Meeting Date: 03/01/2001100
Agenda Item Number: 27
Rcw acenI�.wl- Page
ECONOMIC DEVELOPMENT AGENCY
STAFF REPORT
IN-N-OUT BURGER,INC.,A CALIFORNIA CORPORATION—REDEVELOPMENT
PROJECT STUDY AND EXCLUSIVE RIGHT TO NEGOTIATE AGREEMENT
(CENTRAL CITY NORTH REDEVELOPMENT PROJECT AREA)
BACKGROUND:
On April 2, 2007, the Agency acquired title to 755 West 5d' Street (APN: 0134-093-40), the Royal
Motel. Subsequent to the acquisition, the Agency relocated all tenants and caused that the motel be
demolished. All relocations and demolition were completed in January 2008. The site is
approximately 22,500 square feet.
On January 7, 2008, the Agency acquired title to 795 West 5d3 Street (APN: 0134-093-41), the Paradise
Motel. Subsequent to the acquisition, the Agency relocated all tenants and caused that the motel be
demolished. All relocations and demolition were completed in June 2008. The site is approximately
33,750 square feet.
755 and 795 West 5d3 Street are contiguous, located at the southeast corner of 5d' and "H" Streets, and
are herein referred to collectively as the Property (the"Property").
Since 2004, the State of California (the "State") has been acquiring properties and relocating homes
and businesses on both sides of the I-215 Freeway ("I-215") as part of the I-215 widening project
through downtown San Bernardino. One of the properties, located on 2nd Street at the northbound 2nd
Street off-ramp of the I-215 (the "Site"), is owned by In-N-Out Burgers, Inc., a California Corporation
(the"INO"), which currently operates a restaurant with a drive-thru on the Site.
The State has acquired the Site through eminent domain authority and INO is required to relocate from
the Site no later than January 2012.
CURRENT ISSUE:
In April/May of 2008, representatives of INO met with Agency Staff concerning possible relocation
sites for a new INO restaurant. Several locations were discussed for the relocation including the
Property. The new restaurant design would be similar to the design of the INO restaurant located at
Tippecanoe Avenue and Harriman Place in San Bernardino.
On July 6, 2009, the Agency received a letter from INO wherein INO expressed an interest in
purchasing approximately 45,000 — 55,000 square feet of land at the location of the Property. The
Property is approximately 56,250 square feet.
PWgmWas\Comm De Commission\CDC2010\0341-10ho-N-WBwgc,hw(MO).ERNAgwmwdm COMMISSION MEETING AGENDA
Meeting Date: 03/01/2010
Agenda Item Number: 7i,�—
Economic Development Agency Staff Report
ERN Agreement-In-N-Out Burger, Inc.
Page 2
The Redevelopment Project Study and Exclusive Right to Negotiate Agreement (the "ERN") includes
the following terms:
• The ERN is for a period of twelve (12) months from approval and execution.
• The ERN may be extended, by the Interim Executive Director, for a period of not to exceed
period of six(6)months.
• The ERN may be extended, upon the approval of the Community Development Commission,
for an additional not to exceed period of six(6) months.
• INO is responsible for their own costs in connection with their due diligence investigation of
the Property.
• INO will provide the Agency $50,000 as the ERN Fee which will be applied to the purchase
price of the Property but is not refundable if INO does not proceed with a Disposition and
Development Agreement (the"DDA").
• The Agency will use its best efforts to provide INO with documents pertaining to the Study
Area that is within the possession of the Agency.
Approval of the ERN is the beginning step towards retaining and relocating a successful and viable
business. The relocating to a new site and development of a larger restaurant will create additional
jobs and could become the catalyst for further development in the area. The eventual goal will be to
negotiate a DDA for the sale and development of the Property.
ENVIRONMENTAL IMPACT:
Exempt under Section 15262, Feasibility and Planning Studies, of the California Environmental
Quality Act ("CEQA") Guidelines.
FISCAL IMPACT:
None.
RECOMMENDATION•
That the Community Development Commission adopt the attached Resolution.
Emil A. Marzullo, n Brim Executive Director
P.4Agendas\Comm De Commission\CDC2010\03-01.101n-N-Out Burger,I (WO)-EBNAWxmentdm COMMISSION MEETING AGENDA
Meeting Date: 03//01/2010
Agenda Item Number: AZI
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O N
1 RESOLUTION NO. COP
2 RESOLUTION OF THE COMMUNITY DEVELOPMENT COMMISSION OF
3 THE CITY OF SAN BERNARDINO APPROVING AND AUTHORIZING
THE INTERIM EXECUTIVE DIRECTOR OF THE REDEVELOPMENT
4 AGENCY OF THE CITY OF SAN BERNARDINO ("AGENCY") TO
EXECUTE A REDEVELOPMENT PROJECT STUDY AND EXCLUSIVE
5 RIGHT TO NEGOTIATE AGREEMENT BY AND BETWEEN THE
6 AGENCY AND IN-N-OUT BURGER, INC., A CALIFORNIA
CORPORATION, CONCERNING AGENCY OWNED PROPERTY
7 LOCATED AT THE SOUTHEAST CORNER OF 5TH AND "H" STREETS
(CENTRAL CITY NORTH REDEVELOPMENT PROJECT AREA)
8
9 WHEREAS, the Redevelopment Agency of the City of San Bernardino (the "Agency") is a
community redevelopment agency duly created, established and authorized to transact business and
10
11 exercise its powers, all under and pursuant to the California Community Redevelopment Law (the
12 "CRI!), codified under Division 24, Part 1 of the California Health and Safety Code commencing at
13 Section 33000 and is authorized to construct improvements located within the approved
14 redevelopment project areas in the City of San Bernardino (the "City") in accordance with the CRL;
and
15
16 WHEREAS, on April 2, 2007, the Agency acquired title to 755 West 5`h Street (APN: 0134-
093-40),the Royal Motel, approximately 22,500 square feet; and
17
18 WHEREAS, subsequent to the Agency acquiring the Royal Motel the Agency relocated all
tenants and caused the motel to be demolished; and
19
20 WHEREAS, on January 7, 2008, the Agency acquired title to 795 West 5`h Street (APN:
y 0134-093-41),the Paradise Motel, approximately 33,750 square feet; and
21
22 WHEREAS, subsequent to the Agency acquiring the Paradise Motel the Agency relocated
all tenants and caused the motel to be demolished; and
23
24 WHEREAS, 755 and 795 West 5d' Street are contiguous, located at the southeast corner of
25 5`h and "H" Streets (Central City North Redevelopment Project Area), and herein referred to
26 collectively as the Property(the"Property"); and
27 WHEREAS, the State of California (the "State") has acquired, through eminent domain
28 authority, the current location of the In-N-Out Burger (the "INO'� facility located on 2nd Street
adjacent to the 1-215 Freeway for use in the 1-215 widening project; and
1
P\Agendas\Resolutions\Resolutions12010t03-01-101u N-0a Burger,hn -8RN A�etmml CDC Rno,doc _
1 WHEREAS, the State will take possession of the INO facility on 2 n Street no later than
2 January 2012; and
3 WHEREAS, INO has approached the Agency concerning the possibility of relocating to the
4 Property and constructing a larger facility; and
5 WHEREAS, the Community Development Commission of the City of San Bernardino (the
6 "Commission'), as the governing board of the Agency, seeks to enter into a Redevelopment Project
7 Study and Exclusive Right to Negotiate Agreement(the"ERN")with INO to study the feasibility of
8 constructing a new facility on the Property within the Central City North Redevelopment Project
9 Area.
10 NOW, THEREFORE, THE COMMUNITY DEVELOPMENT COMMISSION OF
11 THE CITY OF SAN BERNARDINO DOES HEREBY RESOLVE, DETERMINE AND ORDER,
12 AS FOLLOWS:
13 Section 1. The information set forth in the above recitals of this Resolution is true and
14 correct.
` 15 Section 2. The Interim Executive Director of the Agency is hereby authorized to execute
16 the ERN on behalf of the Agency in substantially the form attached hereto as Exhibit "A", together
17 with such changes therein as may be approved by the Interim Executive Director of the Agency and
18 Agency Counsel. The Interim Executive Director of the Agency or such other designated
19 representative of the Agency is further authorized to do any and all things and take any and all
20 actions as may be deemed necessary or advisable to effectuate the purposes of the ERN, including
t, 21 making non-substantive modifications to the Construction Contract.
22 Section 3. This Resolution shall take effect from and after its date of adoption by this
23 Commission.
24
25
26
27
28
2
P:WgendasVtesoWSionsVtesolusions1201010J-01-10In-N-Out Husger,Inc.-ERN A,x..,CDC Res.doc
1 RESOLUTION OF THE COMMUNITY DEVELOPMENT COMMISSION OF
THE CITY OF SAN BERNARDINO APPROVING AND AUTHORIZING
2 THE INTERIM EXECUTIVE DIRECTOR OF THE REDEVELOPMENT
3 AGENCY OF THE CITY OF SAN BERNARDINO ("AGENCY") TO
EXECUTE A REDEVELOPMENT PROJECT STUDY AND EXCLUSIVE
4 RIGHT TO NEGOTIATE AGREEMENT BY AND BETWEEN THE
AGENCY AND IN-N-OUT BURGER, INC., A CALIFORNIA
5 CORPORATION, CONCERNING AGENCY OWNED PROPERTY
LOCATED AT THE SOUTHEAST CORNER OF 5' AND "H" STREETS
6 (CENTRAL CITY NORTH REDEVELOPMENT PROJECT AREA)
7 I HEREBY CERTIFY that the foregoing Resolution was duly adopted by the Community
8 Development Commission of the City of San Bernardino at a meeting
9 thereof,held on the day of 2010, by the following vote to wit:
10 Commission Members: Ayes Nays Abstain Absent
11 MARQUEZ
12 DESJARDINS
13 BRINKER
14 SHORETT _
15 KELLEY _
16 JOHNSON _
17 MC CAMMACK _
18
19
20 Secretary
21
22 The foregoing Resolution is hereby approved this day of 2010.
23
24 Patrick J. Morris, Chairperson
Community Development Commission
25 of the City of San Bernardino
26 Approved as to Form:
27 By:
28 Agency Co sel
3
P'.\Agendas\RaolutionsV esolutionsQOID\D3-01-10In-N-Om Burgas,Inc.-ERN Agreenesn CDC Roo
REDEVELOPMENT AGENCY
OF THE CITY OF SAN BERNARDINO
REDEVELOPMENT PROJECT STUDY AND
EXCLUSIVE RIGHT TO NEGOTIATE AGREEMENT
IN-N-OUT BURGER,INC.,A CALIFORNIA CORPORATION
(CENTRAL CITY NORTH REDEVELOPMENT PROJECT AREA)
This Redevelopment Project Study and Exclusive Right to Negotiate Agreement is dated as of
March 1, 2010 (this "Agreement"), and is entered into by and between In-N-Out Burger, Inc., a
California corporation (the "Developer"), and the Redevelopment Agency of the City of San
Bernardino, a public body, corporate and politic (the "Agency"), in light of the facts, understandings
and intentions 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 Central City North Redevelopment Project Area (the "Project Area") of
the City of San Bernardino (the "City").
B. The Arncy is the fee owner of approximately 56,250 square feet of vacant land at the
southeast comer of 5 and "H" Streets within both the Project Area and the Downtown Area of the
City and identified as assessor parcel numbers 0134-093-40 and 0134-093-41 (collectively, the
"Property" and sometimes referred to as the "Study Area").
C. The Study Area is identified and depicted in Exhibit"A" and the legal description of the
Property is set forth in Exhibit "B" both of which are attached hereto and incorporated herein by
reference.
D. The State of California is widening the I-215 Freeway through the City and in doing so
has used eminent domain authority to acquire the Developer's property located on 2"a Street along the
northbound lanes which has necessitated that the Developer move to a new location.
E. The Developer has sent a letter to the Agency expressing their interest in acquiring the
Property and in constructing a new facility on the Property.
F. The Agency is prepared to consider and study specific proposals and plans to facilitate
the redevelopment of the Study Area so as to foster the community economic development goals and
objectives of the Agency for the Project Area.
G. The Developer and the Agency believe it is appropriate for the Developer to undertake
certain redevelopment studies and to incur certain costs as part of a program for the study of feasible
redevelopment programs for the Study Area in anticipation of the acquisition of the Property by the
*r Developer from the Agency, subject to the terms and conditions as set forth below.
`�.. AGREEMENT
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. Developer Acknowledgments and Term of Agreement.
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 and property of the Developer and shall not be
deemed to be undertaken for the benefit of the Agency and the City.
b. The qualifications and identity of the Developer 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 herein below, 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 assignment approved in writing by the Interim Executive Director of
the Agency such approval not to be unreasonably withheld, delayed or conditioned. 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, and (ii) a transfer of the
management and control of the Developer to any third party other than to an Affiliate of the Developer.
(1) As used herein, the term "Affiliate" means any Person which, directly or
indirectly (including through one or more intermediaries), controls or is
controlled by or is under common control with any other Person, including any
Subsidiary of a Person, and (B) any franchisee of Developer or any other
Developer Affiliate. For purposes of this definition, the term "control"
(including the correlative meanings of the terms "controlled by" and "under
common control with"), as used with respect to any Person, shall mean the
possession, directly or indirectly (including through one or more intermediaries),
of the power to direct or cause the direction of the management and policies of
such Person, through the ownership or control of voting securities, partnership
interests or other equity interests or otherwise.
(2) As used herein, the term "Person" means any corporation, partnership, limited
liability company, co-tenancy, joint venture, individual, business trust, real
estate investment trust, trust, banking association, federal or state savings and
loan institution, or any other legal entity, whether or not a party to this
Agreement.
(3) As used herein, the term "Subsidiary" means any corporation, partnership,
limited liability company, business trust or other legal entity with respect to
1)
which a Person owns, directly or indirectly (including through one or more
intermediaries), more than fifty percent(50%) of the voting stock or partnership,
membership or other equity interest, respectively.
The Interim 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
approval from the Developer, together with such documentation as may be reasonably required by the
Interim Executive Director of the Agency, to evaluate the proposed transaction and the proposed
assignee's or transferee'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 or 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 who is principal of the Developer;
(2) the approval and execution by the Developer of one or more purchase/sale
agreements, leases and other similar agreements, including, without limitation,
any co-venture agreements with third parties, 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 Disposition and Development
Agreement referred to in Section 8 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 Disposition and Development
Agreement is approved and executed by all parties and then subject to such
terms and conditions that may be set forth in the Project Disposition and
Development Agreement;
(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 within the Study Area;
(4) Transfers for financing purposes; and
(5) Transfers to any of the following transferees: (A) an Affiliate or successor, by
operation of law, of Developer (i.e. a change in Developer's name, a change in
z
the form of the entity comprising the Developer, or a change in the state of the
Developer's incorporation); (B) any corporation into which or with which the
Developer or any Affiliate of the Developer may merge, or to any corporation or
other business entity or company that results from a reorganization or
= consolidation by or with the Developer; (C) a duly qualified franchisee of the
Developer; (D) a joint venture in which the Developer is a joint venture partner
1 responsible for the conduct of the business in the Project; or(E) any corporation
or other business entity or company to which the Developer sells all, or
substantially all, of its assets in California or all, or substantially all, of its
j corporate shares.
Additionally, for the avoidance of doubt, and in no way limiting the generality of the provisions
of this Section 1, no issuance, sale, conveyance or transfer of the Developer's or any of its Affiliates'
stock or assets, including, without limitation, pursuant to a merger, consolidation or stock exchange,
shall be deemed a Transfer for which the Agency's consent is required.
d. This Agreement shall automatically terminate, without further notice or action, and be
i
of no further force or effect twelve(12) months following the Effective Date, unless prior to that time:
(1) the parties execute the Project Disposition and Development Agreement, 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 Disposition and
Development Agreement; or
(2) the parties each agree at their sole discretion 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 Interim Executive
Director of the Agency first reasonably making a 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 Interim Executive Director of the Agency, (A) the Interim
Executive Director of the Agency is hereby authorized to administratively
{ approve in writing one (1) extension of not to exceed six (6) months in duration,
3 and (B) the governing body of the Agency (the Community Development
Commission(the "Commission")) 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 20 or Section 21, as
applicable.
d
2. The Proiect.
Subject to the terms and conditions of this Agreement, the negotiation and execution of a
mutually satisfactory Project Disposition and Development Agreement (as defined in Section 31
below), 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 analysis of 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 (the "Project").
The Developer may modify the description of the Project at any time; provided, however, that
substantial modifications of the Project shall:
(1) be subject to the written acceptance and written approval of the Agency such
approval not to be unreasonably withheld, delayed or conditioned; 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.
3. Negotiation Period. Proiect Study and Proiect Studv Costs.
a. The rights and duties of the parties established by this Agreement shall commence
following the approval of this Agreement by the Commission and after such time as this Agreement
has been fully executed by the parties within the period of time authorized in Section 18 (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 1.d.(2). Such time period during which
this Agreement shall be in effect (including any extensions of time approved by the Agency) is referred
to as the "Negotiation Period".
b. Within one hundred eighty (180) calendar days following the Effective Date, the
Developer shall submit to the 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, which
may be in the form of a letter from the Developer to the Agency, shall 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; and (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.
The Agency may at its discretion and at its sole cost and expense retain the services of a firm of
community redevelopment and planning and environmental 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.
S
`..
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 Disposition and Development Agreement.
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 expenses of third party consultants
and appraisers who are engaged by the Developer under written contract to undertake one or more
elements of the Project Study (collectively, the "Project Study Costs"); provided, however, that the
Developer shall not be required to pay for any third party consultants engaged by the Agency pursuant
to Section 3.b. above. Furthermore, 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 subject to the confidentiality
provisions of Section 11 below, 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.
£ 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 Disposition and Development Agreement" or 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) in no event shall any such
negotiated Project DDA become effective unless duly approved by the Commission after compliance
with CEQA and all other applicable laws; and (iii) in no event will the Project DDA provide for or
allow the conveyance to the Developer of the Property prior to the issuance of all of the Development
Entitlements consistent with the Project DDA.
g. The Agency and the Developer shall negotiate diligently and in good faith during the
Negotiating Period.
h. Within ten (14) calendar days from receipt of any information from the Developer as
provided in this Section 3, the Interim Executive Director of the Agency shall reasonably determine
whether such information is satisfactory. If the specific item of information is unsatisfactory to the
Interim Executive Director of the Agency, he shall notify the Developer in writing of the reason or
reasons that the information is unsatisfactory. If the Interim Executive Director of the Agency does
not make a determination regarding any item of information submitted by the Developer under this
�... Section 3 within ten (10) 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 Interim
Executive Director of the Agency under this subsection shall 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.
4. Obligations 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 design of
improvement elements as appropriate for the Project; and
b. at the option of the Developer, undertake to retain an additional qualified NMI appraiser
for a second fair market value appraisal of the Property if deemed warranted by the Developer; and
C. 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
Interim 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
d. 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.
5. ERN Fee.
Concurrently, with the execution and delivery of this Agreement by the undersigned parties on
the Effective Date, the Developer has delivered to the Agency a check in the amount of Fifty Thousand
Dollars ($50,000)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, plus interest earnings, if any, will be credited in full toward the Developer's purchase price for the
Property. If the parties do not enter into a Project DDA during the Negotiation Period, the Agency
shall be entitled to retain the entire ERN Fee, plus interest earnings, if any, 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 and remedy against the Developer except as specifically set forth in
Sections 22 and 23 of this Agreement, it being understood and agreed between,the Agency and thei
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 event of an uncured Developer
default 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
7
the amount of actual damages, and that the amount of the ERN Fee, plus interest earnings, if any, 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.
6. Agency Not to Negotiate with Others.
a. The Agency currently deems the acquisition of the Property by the Developer from the
Agency, and the 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 of the 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 for the
redevelopment of land adjacent to the Study Area.
C. Subject to its obligations set forth in Section 6.b. above and the confidentiality
.. provisions of Section 11 below, the Agency may 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.
7. Agencv Cooperation.
During the Negotiation Period,the Agency shall:
a. at the request of the Developer, use its best efforts to assemble written materials and
documents relating to the Property that are in the possession of the Agency; and
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 Entitlement 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; provided, however, that the
Agency reserves its discretion and authority with regard to provide support and approval for the
Development Entitlements for the Project, right to object and the right to take no position of such
matters as set forth in the last paragraph of Section 4 above; and
C. 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
R
d. use its best efforts in working with the City to process the Development Entitlements as
may be deemed acceptable to the Agency, including, if applicable any necessary zoning amendments.
Concurrently with the execution of this Agreement, the Developer and the Agency shall
execute and deliver a Right of Entry and Access Agreement in substantially the form attached hereto as
Exhibit"C".
8. Negotiation of the Project DDA.
It is the intent of the parties that the Developer and the Agency will negotiate the final terms
and conditions of a proposed Project DDA during the Negotiation Period of this Agreement.
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 Commission, nor shall the Commission be
committed to approve any final 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.
Should the Agency and the Developer execute and deliver a Project DDA, the parties anticipate
as of the Effective Date of this Agreement that the Project DDA will or may include, without
limitation,the following terms, provisions and covenants:
(1) that the purchase price for the Property will be the fair market value of the
Property determined not 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); and
(2) that any Broker fees, commissions, or payments shall be paid for by the
Developer and shall not be taken out of the sales price proceeds payable to the
Agency; and
(3) such provisions for Agency financial assistance for on-site, Property and 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 financial assistance
pursuant to this Agreement that may be included in the Project DDA; and
(4) an acknowledgment 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
(5) a provision that the ERN Fee, plus interest earnings, if any, payable pursuant to
-- Section 5 of this Agreement shall be credited in full toward the Developer's
purchase price for the Property.
9. Consideration for this Agreement and Reservation of Rights.
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 (excluding confidential or proprietary information) generated by the Developer or its
consultants regarding the Project to be used only in connection with this Agreement, but without
warranty or representation by the Developer as to the completeness, correctness or validity of such
studies and reports and other information. 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 Commission, 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.
10. Planning and Design; Related Acknowledgments 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.
11. Developer Financial Disclosures.
Subject to its reserved rights set forth in Section 9 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 Developer
reserves the right in its sole and absolute discretion to approve or disapprove any such requested
disclosures. 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 that are
"corporate financial records, corporate proprietary information including trade secrets, and information
relating to sitting within the state furnished to a government agency by a private company for the
purpose of permitting the agency to work with the company in retaining, locating or expanding a
facility within California" as 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 confer with the
Developer to consider any objections that the Developer may have to such disclosure.
12. 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 or any other property rights
of any nature. From and after the termination date of this Agreement and provided that there is no
Project DDA then in effect, the Agency Staff may elect to work in cooperation with the Developer to
continue to process to obtain the Project DDA. 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.
13. 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, sexual orientation, physical disability, mental
disability, medical condition, including the medical condition of Acquired Immune Deficiency
Syndrome, national origin or ancestry, age, including all other protected classes of person and groups
of persons as may be considered as such by any applicable federal, state, or local law, statute, code,
ordinance, rule or regulation, as amended from time to time, in undertaking its obligations under this
Agreement.
14. Compliance 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, environmental planning and safety laws, and California prevailing wage laws. The
parties agree that it is their intent for the Project DDA as finally structured and agreed upon by and
between the Parties to not cause the development of the Project to be considered as a"public work" for
purposes of California prevailing wage laws as a result of the type of financial assistance as may be
provided by the Agency, if any, to the Developer and the determination of the sales price for the
Property to be paid by the Developer to the Agency.
'< 15. Required Approvals.
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 Commission,
following the conclusion of a public hearing, as required by law.
16. Press Releases.
The Developer agrees to discuss any press releases it may propose relating to the Study Area
s� with the Interim Executive Director of the Agency or his designee, prior to publication, to assure
accuracy and consistency of the information.
17. Notice.
All notices required hereunder shall be presented either(i) in person, (ii) by fax and confirmed
by First Class certified or registered United States mail with return receipt requested, or (iii) by
reputable overnight delivery service (such as Federal Express). 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. Notice shall be deemed to have
been completed when the notices have been properly delivered as provided in this Section regardless
of whether notice has been delivered to any other person entitled to receive a copy of such notice.
Failure to provide notice to any person listed herein to receive a copy of notices shall not defeat or
render as incomplete any notice as delivered to the other party that is a signatory to this Agreement.
To the Developer: In-N-Out Burger, Inc.
Attention: Real Estate Department
13502 Hamburger Lane
Baldwin Park, California 91706-5885
For Overnight Deliveries Only:
13752 Francisquito Avenue
Attention: Real Estate Department
Baldwin Park, California 91706
Telephone: (626) 813-7363
With a copy to: Miller Starr Regalia
Attention: JoAnne L. Dunec
1331 N. California Blvd., Fifth Floor
Walnut Creek, California 94596
Telephone: (925) 935-9400
To the Agency: Redevelopment Agency of the City of San Bernardino
Attention.: Emil A. Marzullo, Interim Executive Director
201 North"E" Street, Suite 301
San Bernardino, California 92401-1507
Telephone: (909) 663-1044
18. Acceptance of Agreement by the Developer.
The Developer shall acknowledge its acceptance of this Agreement by delivering three (3)
counterpart executed copies of this Agreement as executed by the Developer 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 the final approval
by the Commission and the execution of this Agreement by the Interim Executive Director of the
Agency.
19. Authority.
Each signatory to this Agreement represents and warrants that he or she has the authority to
execute this Agreement on behalf of the party whom he or she purports to represent.
20. Optional Termination by Developer or by Aeency.
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) calendar day advance
written notice to the Agency. If the Developer terminates this Agreement for any reason other than an
uncured Agency default, it shall not be entitled to a refund of any portion of the ERN Fee, plus interest
earnings, if any, referred to in Section 5, it shall remain responsible for performance of its indemnity
obligations set forth in Section 23 with respect to any acts or omissions of the Developer occurring
prior to the effective date of the termination, and otherwise, neither party shall have any further rights
or obligations to the other party hereunder. If the Developer terminates this Agreement due to an
uncured Agency default, then the ERN Fee,plus interest earnings,if any, shall be promptly refunded to
the Developer, the Agency shall remain responsible for performance of its indemnity obligations set
forth in Section 23 with respect to any acts or omissions of the Agency occurring prior to the effective
date of the termination, the Agency's obligation to refund the ERN Fee, plus interest earnings, if any,
shall survive such termination, 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 21 hereof.
21. 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. Notwithstanding anything to the contrary in the foregoing, if negotiations are
not progressing with diligence and good faith, as determined by either party in its reasonable discretion
each party shall have thirty (30) calendar days to cure the default by re-commencing to negotiate in
good faith.
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 or 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 '3, (i)
the Agency shall not be entitled to specific performance or other equitable or injunctive relief 1 :iinst
the Developer for a default by the Developer hereunder and (ii) the Agency's sole damages ra iedy
shall be to retain the Developer's entire ERN Fee, plus interest earnings, if any, referred to in Sec. on 5
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 21, 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) calendar days following the date of service of the notice of
termination on the other party or (ii) the date otherwise specified in such notice. Except as provided in
Section 23, the Agency shall not otherwise be liable to the Developer for any monetary damages nor
shall the Agency be required to pay compensation to the Developer for any breach by the Agency of
this Agreement.
22. Attorneys' 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. In
Qthe event the City becomes a party to any such action or proceeding or otherwise pursuant to Section
23 hereof, the words "reasonable attorneys' fees" in the case of the Agency shall include the salaries,
costs and overhead of lawyers employed in the Office of the City Attorney of the City of San
Bernardino.
23. Indemnification.
Each party agrees to indemnify, protect, defend and hold the other, 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 arising from or related to any uncured default by the other
t party hereunder or any intentional misconduct or negligent act or omission of the other party, 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 any Claims
arise out of any default by the other party in performing its obligations set forth in this Agreement or to
the extent the other party 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 other party is guilty of malice. The party claiming default shall give the other
party written notice of the occurrence of any Claim for which it seeks indemnity under this Section as
promptly as practicable following such party's knowledge of the occurrence of such matter and the
other party shall reasonably cooperate with the other in the defense of any such Claim. This indemnity
provision shall survive the execution, delivery, expiration and/or termination of this Agreement and
shall apply to the City in the same manner as it shall be applicable to the Agency.
id
24. Governing Law, 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.
25. Severability.
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, shall not be affected thereby, and each such term and
provision of this Agreement shall be valid and enforced to the fullest extent permitted by law.
26. No Intent to Create Third Party Beneficiaries.
The parties intend that the rights and obligations under this Agreement shall 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.
f 27. 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.
28. Entire Agreement: Counterparts.
This Agreement (including Exhibit "A", Exhibit "B" and Exhibit "C" attached hereto) is the
final expression of, and contains the entire agreement between the parties with respect to the subject
t 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 instrument signed by the appropriate party or by its agent duly authorized in writing
or as otherwise expressly permitted herein. In the case of the Agency, the appropriate party shall be
the Interim Executive Director. 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.
29. 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.
30. Construction and Intenwetation of Agreement.
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 if it 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", Exhibit `B" and Exhibit "C" as referred to in this Agreement are
attached hereto and incorporated herein by this reference as if fully set forth herein in their entirety.
1/1
IN WITNESS WHEREOF, the Developer and the Agency execute this Agreement on the dates
indicated next to each of the signatures of their authorized representatives as they appear below, and
this Agreement shall be deemed to be in full force and effect upon the Effective Date.
DEVELOPER:
In-N-Out Burger, Inc.
a California corporation
Dated: By:
Name:
Title:
AGENCY:
Redevelopment Agency of the City of San Bernardino,
a public body, corporate and politic
Dated: G " ' r 0 By:
Emil A. Marzullo, Interim Executive Director
Approved as to Form and Legal Content:
By
A ncy Co ns I
17
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EXHIBIT"A"
DEPICTION OF THE STUDY AREA
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EXHIBIT "B"
LEGAL DESCRIPTION OF PROPERTY
APN: 0134-093-40-0000
PARCEL NO. 1:
LOT 5, BLOCK 26, CITY OF SAN BERNARDINO, IN THE CITY OF SAN BERNARDINO,
COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, AS PER PLAT RECORDED IN
BOOK 7 OF MAPS, PAGE(S) 1, RECORDS OF SAID COUNTY.
EXCEPT THE WEST 200 FEET.
PARCEL NO. 2:
PORTION OF LOT 5, BLOCK 26, CITY OF SAN BERNARDINO, IN THE CITY OF SAN
BERNARDINO, COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, AS PER PLAT
RECORDED IN BOOK 7 OF MAPS, PAGE(S) 1, RECORDS OF SAID COUNTY, DESCRIBED
AS FOLLOWS:
BEGINNING 150 FEET EAST OF THE NORTHWEST CORNER OF LOT 5; THENCE EAST 50
FEET; THENCE SOUTH TO THE SOUTH LINE OF SAID LOT 5; THENCE WEST 50 FEET;
THENCE NORTH TO THE POINT OF BEGINNING.
APN: 0134-093-41-0000
PARCEL NO. 1:
THAT PORTION OF LOT 5, BLOCK 26, CITY OF SAN BERNARDINO, IN THE CITY OF
SAN BERNARDINO, COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, AS PER
PLAT RECORDED IN BOOK 7 OF MAPS, PAGE 1, RECORDS OF SAID COUNTY,
DESCRIBED AS FOLLOWS:
BEGINNING AT A POINT 100 FEET EAST OF THE NORTHWEST CORNER OF SAID LOT;
THENCE EAST 50 FEET; THENCE SOUTH TO THE SOUTH LINE OF SAID LOT; THENCE
WEST 50 FEET; THENCE NORTH TO THE TRUE POINT OF BEGINNING.
PARCEL NO. 2:
THE NORTH 37.5 FEET OF THE WEST 1/2 OF LOT 4, BLOCK 26, CITY OF SAN
BERNARDINO, IN THE CITY OF SAN BERNARDINO, COUNTY OF SAN BERNARDINO,
STATE OF CALIFORNIA, AS PER PLAT RECORDED IN BOOK 7 OF MAPS, PAGE 1,
RECORDS OF SAID COUNTY.
19
PARCEL NO. 3:
THE SOUTH 37.5 FEET OF THE NORTH 75 FEET OF THE WEST 150 FEET OF LOT 4,
BLOCK 26, CITY OF SAN BERNARDINO, IN THE CITY OF SAN BERNARDINO, COUNTY
OF SAN BERNARDINO, STATE OF CALIFORNIA, AS PER PLAT RECORDED IN BOOK 7
OF MAPS, PAGE 1, RECORDS OF SAID COUNTY.
PARCEL NO. 4:
PORTION OF LOT 5, BLOCK 26, CITY OF SAN BERNARDINO, IN THE CITY OF SAN
BERNARDINO, COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, AS PER PLAT
RECORDED IN BOOK 7 OF MAPS, PAGE 1, RECORDS OF SAID COUNTY, DESCRIBED AS
FOLLOWS:
COMMENCING AT THE NORTHWEST CORNER OF SAID LOT 5; THENCE EAST 100
FEET; THENCE SOUTH 150 FEET, MORE OR LESS TO THE SOUTH LINE OF SAID LOT 5;
THENCE WEST 100 FEET TO THE SOUTHWEST CORNER OF SAID LOT; THENCE NORTH
100 FEET TO THE SOUTHWEST CORNER OF SAID LOT; THENCE NORTH 150 FEET,
MORE OR LESS, TO THE POINT OF BEGINNING.
ti
20
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EXHIBIT "C"
FORM OF RIGHT OF ENTRY AND ACCESS AGREEMENT
[Attached]
21
RIGHT OF ENTRY AND ACCESS AGREEMENT
This Right of Entry and Access Agreement (herein called this "Agreement") is made and
entered into as of March 1, 2010 (this "Agreement"), and is entered into by and between the
Redevelopment Agency of the City of San Bernardino ("Grantor"), and In-N-Out Burger, Inc.
("Grantee")
WITNESSETH:
WHEREAS, the Grantor is the owner of the real property more particularly described on
Exhibit A, attached hereto (the "Property"); and
WHEREAS, concurrently with the execution of this Agreement,the Grantor and the Grantee
are entering into a Redevelopment Project Study and Exclusive Right to Negotiate Agreement
related to the Property (the "ERN"); and
WHEREAS, the Grantee needs the right of entry upon and access to the Property for the
purpose of undertaking tests, inspections and other due diligence activities ("Due Diligence
Activities") required in connection with the proposed acquisition by the Grantee of the Property in
accordance with the ERN; and
WHEREAS, the Grantor has agreed to grant to the Grantee, and the Grantee has agreed to
accept from the Grantor, a non-exclusive license to enter upon the Property to perform the Due
Diligence Activities in accordance with the terms and provisions of this Agreement;
WHEREAS, the Grantor and the Grantee desire to execute and enter into this Agreement for
the purpose of setting forth their agreement with respect to the Due Diligence Activities and the
Grantee's entry upon the Property.
NOW, THEREFORE, for and in consideration of the foregoing premises, the mutual
covenants and agreements contained herein, and other good and valuable consideration, the receipt
and sufficiency-of which are hereby acknowledged, the Grantor and the Grantee do hereby covenant
and agree as follows:
1. Access by Grantee. Subject to Grantee's compliance with the terms and provisions
of this Agreement, the Grantee and the Grantee's employees, agents and consultants designated in
writing by the Grantee (collectively, "Grantee's Designees") shall have the right to enter upon the
Property for the purpose of conducting the Due Diligence Activities, until the earliest to occur of: (i)
the expiration or earlier termination of the ERN; (ii) the termination of this Agreement; or (iii) the
execution of the Project Disposition and Development Agreement (the "Project DDA")
contemplated by the ERN.
The Grantee expressly agrees as follows: (i) that during the period of performance
of Due Diligence Activities pursuant to this Agreement, the Grantee shall keep the area in which
such Due Diligence Activities is performed free of trash or debris caused by such Due Diligence
Activities; (ii) any activities by or on behalf of the Grantee, including, without limitation, the entry
by the Grantee or the Grantee's Designees onto the Property in connection with the Due Diligence
Activities shall not damage the Property in any manner whatsoever except for minor damage
normally resulting from typical site investigation activities such as soil borings; (iii) in the event the
Property is altered or disturbed in any manner in connection with the Due Diligence Activities, the
Grantee shall promptly return the Property to the condition existing prior to the Due Diligence
Activities (unless otherwise agreed in writing by the Interim Executive Director of the Agency), and
(iv)the Grantee shall indemnify, defend and hold the Grantor harmless from and against any and all
claims, liabilities, damages, losses, costs and expenses of any kind or nature whatsoever (including,
without limitation, attorneys' fees and expenses and court costs) suffered, incurred or sustained by
the Grantor as a result of, by reason of, or in connection with the Due Diligence Activities or entry
by the Grantee and/or by the Grantee's Designees onto the Property, except to the extent they result
from a pre-existing condition (and the Grantee and/or the Grantee's Designees, are not negligent in
their actions with respect to any such pre-existing condition) and/or the negligence or willful
misconduct of the Grantor and/or of any of the Grantor's Designees.
2. Lien Waivers. Upon receipt of a written request from the Grantor, the Grantee will
provide the Grantor with lien waivers following completion of the Due Diligence Activities from
each and every contractor, materialman, engineer, architect and surveyor who might have lien
rights, in form and substance reasonably satisfactory to the Grantor and its counsel. To the extent
permitted by applicable law, the Grantee hereby indemnifies the Grantor from and against any
.„, claims or demands for payment, or any liens or lien claims made against the Grantor or the Property
as a result of the Due Diligence Activities.
3. Insurance. The Grantee shall, and shall cause all of the Grantee's Designees
performing the Due Diligence Activities to, procure or maintain a policy of commercial general
liability insurance issued by an insurer reasonably satisfactory to the Grantor covering each of the
Due Diligence Activities with a single limit of liability (per occurrence and aggregate) of not less
than $1,000,000.00, and to deliver to the Grantor a certificate of insurance evidencing that such
insurance is in force and effect, and evidencing that the Grantor has been named as an additional
insured thereunder with respect to the Due Diligence Activities. Such insurance may be provided
through a blanket policy(ies). Such insurance shall be maintained in force throughout the term of
this Agreement. If the Grantee's contractors used for Due Diligence Activities are unable to meet
these insurance requirements on their own, the Grantee may provide such coverage on their behalf.
4. Successors. To the extent any rights or obligations under this Agreement remain in
effect, this Agreement shall be binding upon and enforceable against, and shall inure to the benefit
of the parties hereto and their respective heirs, legal representatives, successors and permitted
assigns.
5. Limitations. The Grantor does not hereby convey to the Grantee any right, title or
interest in or to the Property, but merely grants the specific and limited contractual rights set forth
,.. herein.
6. Notices. Whenever any notice, demand, or request is required or permitted under
this Agreement, such notice, demand, or request shall be in writing and shall be addressed and
delivered as provided in the notices provision of the ERN.
7. Assignment. Except for a written assignment by the Grantee to the Grantee affiliate
that will be executing the Project DDA, if any, and a concurrent written assumption by the affiliate
of this Agreement, this Agreement may not be assigned by the Grantee, in whole or in part,without
the prior express written consent of the Grantor in its sole and absolute discretion.
8. Governing Law. This Agreement shall be construed, enforced and interpreted in
accordance with the laws of the State of California.
9. Counterparts. This Agreement may be executed in several counterparts, each of
which shall be deemed an original, and all of such counterparts together shall constitute one and the
same instrument.
10. No Recording of Agreement or Memorandum of Agreement. In no event shall
this Agreement or any memorandum hereof be recorded, and any such recordation or attempted
recordation shall constitute a breach of this Agreement by the party responsible for such recordation
or attempted recordation.
IN WITNESS WHEREOF, the Grantor and the Grantee have caused this Agreement to be
executed on the day and year first written above.
GRANTOR
Redevelopment Agency of the City of San Bernardino,
a public body, corporate and politic
Date: By:
Emil A. Marzullo, Interim Executive Director
Approved as to Form and Legal Content:
By:
Agency Counsel
GRANTEE
In-N-Out Burger, Inc.
a California corporation
Date: By:
Print Name:
Title:
EXHIBIT "A"
To
Right of Entry and Access Agreement
LEGAL DESCRIPTION OF THE PROPERTY
APN: 0134-093-40-0000
PARCEL NO. 1:
LOT 5, BLOCK 26, CITY OF SAN BERNARDINO, IN THE CITY OF SAN BERNARDINO,
COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, AS PER PLAT RECORDED IN
BOOK 7 OF MAPS, PAGE(S) 1, RECORDS OF SAID COUNTY.
EXCEPT THE WEST 200 FEET.
PARCEL NO. 2:
PORTION OF LOT 5, BLOCK 26, CITY OF SAN BERNARDINO, IN THE CITY OF SAN
BERNARDINO, COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, AS PER PLAT
1.. RECORDED IN BOOK 7 OF MAPS, PAGE(S) 1, RECORDS OF SAID COUNTY, DESCRIBED
AS FOLLOWS:
BEGINNING 150 FEET EAST OF THE NORTHWEST CORNER OF LOT 5; THENCE EAST 50
FEET; THENCE SOUTH TO THE SOUTH LINE OF SAID LOT 5; THENCE WEST 50 FEET;
THENCE NORTH TO THE POINT OF BEGINNING.
APN: 0134-093-41-0000
PARCEL NO. 1:
THAT PORTION OF LOT 5, BLOCK 26, CITY OF SAN BERNARDINO, IN THE CITY OF
SAN BERNARDINO, COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, AS PER
PLAT RECORDED IN BOOK 7 OF MAPS, PAGE 1, RECORDS OF SAID COUNTY,
DESCRIBED AS FOLLOWS:
BEGINNING AT A POINT 100 FEET EAST OF THE NORTHWEST CORNER OF SAID LOT;
THENCE EAST 50 FEET; THENCE SOUTH TO THE SOUTH LINE OF SAID LOT; THENCE
WEST 50 FEET; THENCE NORTH TO THE TRUE POINT OF BEGINNING.
PARCEL NO. 2:
THE NORTH 37.5 FEI OF THE WEST 1/2 OF LOT 4, BLOCK 26, CITY OF SAN
BERNARDINO, IN THE ITY OF SAN BERNARDINO, COUNTY OF SAN BERNARDINO,
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STATE OF CALIFORNIA, AS PER PLAT RECORDED IN BOOK 7 OF MAPS, PAGE 1,
RECORDS OF SAID COUNTY.
PARCEL NO. 3:
THE SOUTH 37.5 FEET OF THE NORTH 75 FEET OF THE WEST 150 FEET OF LOT 4,
BLOCK 26, CITY OF SAN BERNARDINO, IN THE CITY OF SAN BERNARDINO, COUNTY
OF SAN BERNARDINO, STATE OF CALIFORNIA, AS PER PLAT RECORDED IN BOOK 7
OF MAPS, PAGE 1, RECORDS OF SAID COUNTY.
PARCEL NO. 4:
I
PORTION OF LOT 5, BLOCK 26, CITY OF SAN BERNARDINO, IN THE CITY OF SAN
BERNARDINO, COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, AS PER PLAT
RECORDED IN BOOK 7 OF MAPS, PAGE 1, RECORDS OF SAID COUNTY, DESCRIBED AS
FOLLOWS:
COMMENCING AT THE NORTHWEST CORNER OF SAID LOT 5; THENCE EAST 100
FEET; THENCE SOUTH 150 FEET, MORE OR LESS TO THE SOUTH LINE OF SAID LOT 5;
THENCE WEST 100 FEET TO THE SOUTHWEST CORNER OF SAID LOT; THENCE NORTH
r^ 100 FEET TO THE SOUTHWEST CORNER OF SAID LOT; THENCE NORTH 150 FEET,
tiwr MORE OR LESS, TO THE POINT OF BEGINNING.
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