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HomeMy WebLinkAboutR20-Economic Development CITY OF SAN BERNARDINO ECONOMIC DEVELOPMENT AGENCY ORIGINAL FROM: Emil A. Marzullo Interim Executive Director SUBJECT: Watson-Westridge, LLC - Amendment No.1 to the 2005 Disposition and Development Agreement (144.52-acre residential development located north of Foothill Drive and east of Sterling Avenue) DATE: January 22, 2009 SvnoDsis of Previous Commission/CounciVCommittee Action(s): On December 18, 2008, Redevelopment Committee Members Johnson and Baxter unanimously voted to recommend that the Community Development Commission consider this action for approval. Recommended Motion(s): (Communitv DeveloDment 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 Amendment No.1 to the 2005 Disposition and Development Agreement by and between the Agency and Watson-Westridge, LLC ("Developer") (144.52-acre residential development located north of Foothill Drive and East of Sterling Avenue) Contact Person(s): Musibau Arogundade Phone: Project Area(s): N/A Ward(s): (909) 663- I 044 4th Supporting Data Attached: [{I Staff Report [{I Resolution(s) [{I Agreement(s)/Contract(s) [{I Map(s) [{I Letter(s) FUNDING REQUIREMENTS: Amount: $ -0- Source: Budget Authority: N/A N/A Fiscal Review: (" ~~< rC,a Lindset ---c-~-;;;;;;-issio;;/co;;;;cilNoies;~~_m____-:~es:o------;4~)'V.;2-209--.::--~-______mm- ) -") Services Director /R6WtfU'Sjl' k'3 f3 //020/09 , , P:\Agendas\Comm Dev Commission\CDC 2009\02-02-09 Watson.Westtidge - Amendment No_ I SR (Con't),doc COMMISSION MEETING AGENDA Meeting Date: 01/20/2009 Agenda Item Number: p.2.0 1-2-0'1 CITY OF SAN BERNARDINO ECONOMIC DEVELOPMENT AGENCY FROM: Emil A. Marzullo Interim Executive Director SUBJECT: Watson-Westridge, LLC - Amendment No. I to the 2005 Disposition and Development Agreement (144.52-acre residential development located north of Foothill Drive and east of Sterling Avenue) DATE: January 8. 2009 Svnopsis of Previous Commission/Council/Committee Action(s): On January 8, 2009, Redevelopment Committee Members Johnson, Baxter and Brinker unanimously voted to recommend that the Community Development Commission consider this action for approval. On December 18, 2008, Redevelopment Committee Members Johnson and Baxter unanimously voted to recommend that the Community Development Commission consider this action for approval. Recommended Motion(s): (Communitv 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 Amendment No. I to the 2005 Disposition and Development Agreement by and between the Agency and Watson-Westridge, LLC ("Developer") (l44.52-acre residential development located north of um__mmmmm___X~~!i!j_!U2~j_~e__"!1_~__~~~_!_~f_S_!eEli!1jL,'\_~e_n_lI.e}mmmmmmmmmmmmmmmmmm________mm___mm_________mmm__mm__mm______ Contact Person(s): Project Area(s): Supporting Data Attached: Musibau Arogundade Phone: (909) 663-1044 4th N/A Ward(s): o Staff Report 0 Resolution(s) 0 Agreement(s)/Contract(s) 0 Map(s) 0 Letter(s) FUNDING REQUIREMENTS: Amount: $ -0- Source: N/A N/A Budget Authority: Signature: Emil A. Marzullo, lYe Director Fiscal Review:a /),(, (({, " _.---;;~'). Barbara Lindseth, Administrative . /;' / -.(" I v.n Services Director Commission/Council Notes: P:\Agendas\Comm Dev CommissionlCDC 2009\OI-2Q.-09 Amendment No. I to Watson-Westridge DDA SR.doc COMMISSION MEETING AGENDA Meeting Date: 01120/2009 Agenda Item Number: ~ 38. ECONOMIC DEVELOPMENT AGENCY STAFF REPORT WATSON-WESTRIDGE, LLC - AMENDMENT NO.1 TO THE 2005 DISPOSITION AND DEVELOPMENT AGREEMENT (144.52-ACRE RESIDENTIAL DEVELOPMENT LOCATED NORTH OF FOOTHILL DRIVE AND EAST OF STERLING AVENUE) BACKGROUND: On January 6, 2003, the Mayor and Common Council of the City of San Bernardino ("Council") and Community Development Commission of the City of San Bernardino ("Commission") authorized the Redevelopment Agency of the City of San Bernardino ("Agency") and the City of San Bernardino Water Department ("City") staff to solicit proposals for the sale and development of Agency and City property located north of Foothill Drive and east of Sterling Avenue. The City's property (APN: 0155-361-25) consists of 136.40 acres and the Agency's property (APN: 0155-381-45) consists of8.12 acres, for a total of 144.52 acres (the "Site"). In February 2003, the Site was surveyed and appraised. The appraised value of the City's property was $955,000 and the appraised value of the Agency's property was $203,000 (total value $1,158,000). This appraisal was based on the value of the raw land without consideration to the fact that the Site is located within the Foothill Fire Zone and thus, the entire Site is not useable. On May 8, 2003, Requests for Proposals ("RFP") were mailed to 30 developers and interested parties and on July 3, 2003, the Agency received two responsive proposals. On July 14, 2003, the two developers made presentations and were interviewed by a panel comprised of Agency Staff, City staff, and Council Member Neil Derry. The panel agreed that J.R. Watson & Associates Development Co. (Watson- Westridge, LLC) ("Developer") had the most favorable proposal that met or exceeded the RFP parameters. On October 6, 2003, the Commission approved a 2003 Redevelopment Project Study Agreement ("2003 Study Agreement") with the Developer to study the development of approximately 107 single-family homes and to pay the Agency $1.2 million for the Site. The Developer has been in business for 25 years, has developed over 40 major residential and commercial projects, and constructed the University Village project under a 2005 Disposition and Development Agreement ("DDA") with the Agency. On August 15, 2005, the Council and the Commission approved the DDA between the Agency and the Developer. Below are the business points of the DDA: . The City will sell the 136.4-acre site to the Agency at the appraised value of $776,000. . The Agency will sell the entire Site to the Developer for the agreed upon purchase price of $1.2 million. . Although the Developer had initially agreed to build 107 single-family homes, due to environmental and geological factors revealed during the study period, the Developer may be able to develop up to 77 single-family homes and appropriate on- and off-site improvements (approximately 55-acre grading footprint). The homes will be built on a minimum 10,000 square feet lot with a minimum 2,500 square feet of living space, 3 and up to 7 bedrooms, up to 4 car garages, I and 2-story homes with multiple floor plans and elevations. In addition, the balance of the acreage will be developed ___~__________________________________________________________ ________________________________________________________________________________________________________u_______________________ P:\Agendas\Comm Dev CommissionlCDC 2009\01-20-09 Amendment No I to Watson-Westridge OVA SR,doc COMMISSION MEETING AGENDA Meeting Date: 01/20/2009 Agenda Item Number: ~ Economic Development Agency Staff Report Amendment No. 1- Watson-Westridge, LLe Page 2 with walking and hiking trails, monumental entry ways, 2 gazebos, a passive park, and open space. The development will be a private and gated community and the common landscape and improvements would be maintained through a maintenance district. . The Developer agreed to match City funds of up to $200,000 to improve and enhance landscaping and public improvements on Del Rosa Avenue, a major thoroughfare into the proposed development Site (presently it is understood that the City has budgeted or will budget an equal sum in the City's Capital Improvement Program budget to assist with the accomplishment of the enhancement improvements which are vital to the success of the proposed development). . The Agency will be required in the DDA to pay not more than $56,000 for the acquisition of the property from the County Flood Control District. This $56,000 figure represents the amount that will be paid by the Developer, which is in excess of the appraised value of the Site. The Agency property and the City property are not contiguous but are separated by property owned by the County Flood Control District and used for a flood control basin and the storage or excavated materials from the basin. It is anticipated that two lots in the Agency property will be exchanged for additional land or an easement on the land of the County Flood Control District that is adjacent to the City property to allow for the acquisition of the portion of the County property to thus connect the Agency property with the City property by an on-site street or a street easement that will be owned and maintained by the Homeowner's Association (HOA). The appraisal assumed the "as is" value of the two parcels consisting of the Agency property and the City property whereas the intended use requires that these parcels be connected with an access road. To the extent that the $82,000 figure is not needed, the Agency will retain the excess amount; if this amount is insufficient to acquire all the County property as needed, then the Developer must pay the additional amounts or cancel the DDA and the escrow for the purchase of the Site. . The Developer has committed to donate $50,000 to the Literacy Program managed by California State University at San Bernardino ("CSUSB"). CURRENT ISSUE: Since the approval of the DDA, the Developer has: . Expended over $1.2 million for site investigations that include earth trenching and boring, soils investigation, geology, topography, lot creation and grading studies, preparation of several tentative maps and environmental studies; . Reduced development from 107 to 72 lots due to environmental, geological factors, the City required the Hillside Management Overlay District Code which minimizes the effect of grading and ensures that the natural character of the hillside area is retained; . Submitted a complete application for design review to the City, however, all new applications will have to be resubmitted as a result of new geological, environmental findings; P:\Agendas\Comm Dev Commission\CDC 2009\01-20-09 Amendment No. I to Watson-Westridge DDA SR.doc COMMISSION MEETING AGENDA Meeting Date: 01/20/2009 Agenda Item Number: /l.3S Economic Development Agency Staff Report Amendment No.1 - Watson-Westridge, LLe Page 3 . Donated $50,000 to the Literacy Program managed by CSUSB, as required by Section 2.IO(b) of the DDA; . Entered into and committed to an Agreement with V A Consulting and other engineering firms to conduct aerial photographs, environmental, soils and geological studies, numerous variations of workable lot studies and tentative maps, modifications to rough grading plans, infrastructure studies, design and plotting studies, tentative tract map, final tract map and public improvement plans for the property, addressing and recognizing the new environmental and geological findings; . Secured an Agreement with the East Valley Water District with regard to the provision of water service to the property and the location of certain water facilities. As a result of the above progress and investment of time and money, the Developer is requesting a five- year extension of the DDA to December 31, 2013 (See attachment). Agency Staff has reviewed the Developers request and has had discussions with the Developer and the City with all parties agreeing to a one-year extension of the DDA with a four-year first right of refusal to acquire the property. The one- year extension of the DDA with a four-year first right of refusal will prevent the property from being tied up for another five years and provide the Developer the right to be notified and exercise the option of acquiring the property in the event the Agency or the City decides to put the property into any other public or private use during the next five years. ENVIRONMENT AL IMPACT: A revised Initial Study is being prepared for the proposed development and will be distributed to affected agencies in accordance with the California Environmental Quality Act (CEQA). Because there are potential impacts, it is proposed that the Commission and the Council will consider the adoption of a Mitigated Negative Declaration when the revised Initial Study is completed. FISCAL IMPACT: As described above under Background. RECOMMENDATION: That the Community Development Commission adopt the attached Resolution. Emil A~ E..,.ff.. Dlud" P:\Agendas\Comm Dev CommissionlCDC 2009\01-20-09 Amendment No.1 to Watson-Westridge DDA SR.doc COMMISSION MEETING AGENDA Meeting Date: 01/20/2009 Agenda Item Number: t:~ e 1 RESOLUTION NO. 2 3 4 5 6 7 8 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 AMENDMENT NO. 1 TO THE 2005 DISPOSITION AND DEVELOPMENT AGREEMENT BY AND BETWEEN THE AGENCY AND WATSON-WESTRIDGE, LLC, ("DEVELOPER") (144.52-ACRE RESIDENTIAL DEVELOPMENT LOCATED NORTH OF FOOTHILL DRIVE AND EAST OF STERLING AVENUE) WHEREAS, the Redevelopment Agency of the City of San Bernardino (the "Agency"), is a 9 public body, corporate and politic existing under the laws of the State of California, Health and 10 Safety Code 33101, and is charged with the mission of redeveloping blighted and underutilized 11 land pursuant to Health and Safety Code Section 33396; and 12 WHEREAS, on August 15, 2005, the Mayor and Common Council and Community 13 Development Commission approved the 2005 DDA for the disposition and development of 144.52 14 acres of land for residential development north of Foothill Drive and east of Sterling Avenue for 15 $1.2 million; and 16 WHEREAS, since the approval of the 2005 DDA, the Developer has: . Expended over $1.2 million for site investigations that include earth trenching and boring, soils investigation, geology, topography, lot creation and grading studies, 17 18 19 20 21 22 preparation of several tentative maps and environmental studies; · Reduced development from 107 to 72 lots due to environmental, geological factors, the City required Hillside Management Overlay District Code which minimizes the effect 0 grading and ensures that the natural character of the hillside area is retained; 23 24 25 26 27 28 · Submitted a complete application for design review to the City, however, all new applications will have to be resubmitted as a result of new geological, environmental findings; · Donated $50,000 to the Literacy Program managed by CSUSB, as required by Section 2.l0(b) of the DDA; P\Agendas'Resolutions\.Resolutions'1009'OI-20-09 W~uon.We$t1;dge CDC Reso doc I 2 3 4 5 6 7 8 9 . Entered into and committed to an Agreement with V A Consulting and other engineering firms to conduct aerial photographs, environmental, soils and geological studies. numerous variations of workable lot studies and tentative maps, modifications to rough grading plans, infrastructure studies, design and plotting studies, tentative tract map, final tract map and public improvement plans for the property. addressing and recognizing the new environmental and geological findings; and . Secured an Agreement with the East Valley Water District with regard to the provision of water service to the property and the location of certain water facilities. WHEREAS. the 2005 DDA will expire on August 15. 2009. and the Developer has 10 requested a five-year extension of the 2005 DDA to December 31. 2013 to allow for the completion II of site investigations and development; and 12 WHEREAS, Agency Staff and the Developer after discussions, has agreed to a one-year 13 extension with a four-year first right of refusal to acquire the property which is the subject of 15 14 Amendment No. I to the 2005 DDA: and WHEREAS. Amendment No. I will prevent the Property from being tied up for five years 16 and provide the Developer the right to be notified and exercise the option of acquiring the Property 17 in the event the Agency or the City decides to put the Property into other public or private use; and 18 19 will be distributed to affected agencies in accordance with the California Environmental Quality WHEREAS, a revised Initial Study is being prepared for the proposed development and 20 Act (CEQA). Because there are potential impacts. it is proposed that the Commission and the 21 Council will consider the adoption of a Mitigated Negative Declaration when the revised Initial 23 22 Study is completed; and WHEREAS, it is appropriate for the Commission to take action with respect to Amendment 25 24 No. I and approve Amendment No. I to the 2005 DDA as set forth in this Resolution. NOW. THEREFORE. THE COMMUNITY DEVELOPMENT COMMISSION OF THE 26 CITY OF SAN BERNARDINO DOES HEREBY RESOLVE. DETERMINE AND ORDER. AS 27 FOLLOWS: 28 II P -\gendJ; Re.;olunon:" Resolu(ion~:OUq l) I_~O_O'! Wal>on-\\ ewid~e (DC Reso do~ 2 1 Section 1. The Commission hereby approves Amendment No. I to the 2005 DDA. The 2 Interim Executive Director is hereby authorized and directed to execute Amendment No. I to the 3 2005 DDA on behalf of the Agency together with nonsubstantive and conforming changes as may 4 be recommended by the Interim Executive Director and Agency Counsel. The Interim Executive 5 Director is hereby authorized to take all appropriate actions as set forth in Amendment No. I to the 6 2005 DDA to implement the disposition and redevelopment of the Site. 7 Section 2. This Resolution shall take effect from and after its date of adoption by this 8 Commission. 9 /1/ 10 /1/ 11 /11 12 //1 13 /1/ 14 //1 15 //1 16 /1/ 17 //1 18 /1/ 19 /1/ 20 //1 21 /1/ 22 /1/ 23 /1/ 24 /1/ 25 /1/ 26 /1/ 27 //1 28 /1/ 3 P \Agendas'Re$OlutionsResolulions :!.00901-~O-09 Wal$On-Wntridge CDC Reso doc 1 2 3 4 5 6 7 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 AMENDMENT NO. 1 TO THE 2005 DISPOSITION AND DEVELOPMENT AGREEMENT BY AND BETWEEN THE AGENCY AND WATSON-WESTRIDGE, LLC, ("DEVELOPER") (144.52-ACRE RESIDENTIAL DEVELOPMENT LOCATED NORTH OF FOOTHILL DRIVE AND EAST OF STERLING AVENUE) I HEREBY CERTIFY that the foregoing Resolution was duly adopted by the Community 8 Development Commission of the City of San Bernardino at a , 2009, by the following vote to wit: meeting 18 19 Navs Abstain Absent Secretary day of ,2009. 20 The foregoing Resolution is hereby approved this 21 22 23 24 Patrick J. Morris, Chairperson Community Development Commission of the City of San Bernardino Approved as to Form: 25 26 By: "- /' ~rd rviJ____ 27 Agency Co~ 28 4 PAgenda~' Resolutions Rc!>OILllions'200901-ZO-09 Wauon-Wcmidgc CDC R~ doc AMENDMENT NO. I TO 2005 DISPOSITION AND DEVELOPMENT AGREEMENT (Watson-Westridge, LLC) THIS AMENDMENT NO. I TO 2005 DISPOSITION AND DEVELOPMENT AGREEMENT (the "Amendment No. J"'), dated as of January 20, 2009, is entered into by and between the Redevelopment Agency of the City of San Bernardino, a public body, corporate and politic (the "Agency") and Watson-Westridge, LLC, a California limited liability company (the "Developer"). The Agency and the Developer agree as follows: RECITALS WHEREAS, the Agency and the Developer have executed and entered into the 2005 Disposition and De\.elopment Agreement, dated as of August 15,2005 (the "2005 DDA"); and WHEREAS, the Agency and the Developer desire to amend the 2005 DDA pursuant to the terms, covenants and conditions of this Amendment No. I (the 2005 DDA, as amended by this Amendment No. I shall be referred to as the "Agreemenf'). NOW, THEREFORE, IN CONSIDERATION OF THE RECITALS MENTIONED ABOVE, THE MUTUAL PROMISES OF THE AGENCY AND OF THE DEVELOPER IN THIS AMENDMENT NO. I AND FOR OTHER GOOD AND VALUABLE CONSIDERATION THE RECEIPT AND SUFFICIENCY OF WHICH ARE HEREBY ACKNOWLEDGED BY THE A.GENCY AND BY THE DEVELOPER, THE AGENCY AND THE DEVELOPER AGREE AS FOLLOWS: 1. reference, Recitals. The Recitals of this Amendment No. I are incorporated herein by this 2, Definitions. Initially capitalized terms in this Amendment No. I shall have the meanings as provided in the 2005 DDA except for those terms specifically defined in the introductory paragraph of this Amendment No, I, in the recitals and/or in this Amendment No. I. (a) The term "sold", "sell"" or "sale" shall include a sale of or grant of an option to buy the Property or any portion thereof or any interest therein by a private party and specifically excluding any governmental entity. Any such sale to any party other than an affiliate of the Developer or to a governmental entity shall be referred to herein as a "Disposition:' (b) The term "offer" shall include, without limitation, any bona fide option proposed to be granted by the Agency. P -\~e[lJ",..-\~emla .-I.tladllTI~nl~ "\!lend. .-\lla~h'l1en(! .-I.~enda Alldcnrnem, .-I.grml'.Amend ~nl)'J 01-:0-09 \\al'on-We~I"d!!e. LLC -\mendmenl '0 I FI:\.-\L d.:.c (c) The term "affiliate" shall mean as to the Person (as hereinafter defined) in question, any Person that directly or indirectly, through one or more intermediaries, controls, is controlled by, or is under common control with the Person in question. As used in the immediately preceding sentence, "control" means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a person, whether through ownership of voting securities, partnership interests, by contract or otherwise. (d) The term "Person" shall mean any individual, corporation, partnership, limited liability company, joint venture, association, joint stock company, trust, estate, unincorporated organization or any other form of entity. The term Person shall specifically exclude any governmental agency, political subdivision, municipal corporation, governmentally controlled non-profit corporation or other pubic entity that intends to make use of the Property for a governmental use or other public purpose. (e) The term "Quitclaim Deed" shall mean the "Quitclaim Deed" to be executed and acknowledged by the Developer to the Agency, in recordable form for recordation in the official records of the county recorder's office for the County of San Bernardino, State of California, in accordance with Section 6 of this Amendment No. I, a copy of which is attached hereto and incorporated herein by this reference as Exhibit "B". (f) The term "2005 DDA Expiration Date" shall mean the date that the term of the 2005 DDA expires pursuant to Section 3 of this Amendment No. I, or earlier terminates in accordance with the terms, covenants and conditions of the 2005 DDA, as amended by this Amendment No. I. (g) The term "Release Agreement" shall mean the Release Agreement to be executed by and between the Developer and the Agency, a copy of which is attached hereto and incorporated herein by this reference as Exhibit "A". (h) The term "Right of First Refusal Term" means the period commencing on the 2005 DDA Expiration Date and expiring four (4) years thereafter on August 15,2014, unless sooner terminated in accordance with the 2005 DDA, as amended by this Amendment No. I, including the transfer or commitment to a public use by either the San Bernardino Municipal Water Department (the "Water Department") or the Agency of their respective portions of the Property, or any other governmental agency, political subdivision, municipal corporation, governmentally controlled non- profit corporation or other public entity that intends to make use of the Property for a governmental use or other public purpose. (i) The term "Property"' as used herein includes real property owned by the Water Department and real property owned by the Agency. Nothing contained in this Amendment No. I shall preclude either the Water Department or the Agency from transferring their respective portions of the Property, either separately, as single transactions or as a combined transaction to any other governmental agency, political subdivision, municipal corporation, governmentally controlled non- profit corporation or other public entity that intends to make use of the Property for a governmental use or other public purpose. The Water Department and the Agency may additionally retain their respective portions of the Property and commit such portions to a public use either separately, as single transactions, or as a combined transaction. Any such public use or transfer in accordance with the preceding sentences of either or both portions of the Property shall relieve the Agency of any further 2 P \Agcnd.as'Agcndil Anachmems'Agcnda Anachmcnls'Agcnda At!achmcnl5AgTmls~Amcnd 2009,01-20-09 Walson-Wcslridge, llC - Amendment!><o I FlSALdoo; compliance requirements with the restrictions of this Amendment No. 1 upon such transfer or commitment to a public use by either the Water Department or the Agency of either or both of their respective portions of the Property. 3. Term of the Agreement. The term of the Agreement shall be extended one (I) year from August IS, 2009, to August IS, 2010. The term of the Agreement shall expire on August 15, 2010, subject to any earlier termination as provided for in the 2005 DDA, as amended by this Amendment No. I. 4. Initial Purchase Opportunity. Subject to the terms and conditions below, should the Agency at any time during the Right of First Refusal Term desire to make a Disposition with respect to all or any portion of the Property or any interest therein (the Property, or such portion thereof, or such interest therein being hereinafter referred to as the "Offered Property"), then the Agency shall give the Developer written notice of such intention, and the Agency and the Developer, for a period of thirty (30) calendar days after the Developer's receipt of such notice, shall negotiate in good faith to reach an agreement and the price, terms and contract form pursuant to which the Developer will purchase the Offered Property. If the Agency and the Developer are not able to reach an agreement for such purchase and sale within such thirty (30)-calendar day period, the Agency, subject to the terms of this Amendment No. I, may market the Offered Property to persons or entities other than the Developer. Any such process initiated by the Agency with third parties after the 2005 DDA Expiration Date for the remaining Right of First Refusal Term pursuant to this Section 4, after providing the Developer with the aforesaid notice, may be consented to, approved and executed by the Agency with any third party, subject to the Agency's compliance with Section 5 below, affording the Developer the First Refusal Right (as defined below). 5. First Refusal. Subject to the terms and conditions set forth below, if the Agency at any time after the 2005 DDA Expiration Date and for the remaining Right of First Refusal Term receives a bona fide offer acceptable to the Agency, or makes a bona fide offer acceptable to an offeree, for a Disposition of the Offered Property, then the Developer shall have the right and option, but not the obligation, to purchase the Offered Property (the "First Refusal Right") on the following terms and conditions: (a) The Agency shall provide the Developer with a written notice (the "Agencv Notice") which shall (i) set forth the true identity of the proposed purchaser (including the identity of the principals of the purchaser, if known to the Agency), (ii) include a description of the Offered' Property, (iii) include a description of all material terms of the proposed Disposition, including, without limitation, the price, earnest money, due diligence inspection period and closing date, and (iv) offer to consummate such Disposition with the Developer upon the same terms and conditions as set forth in the Agency Notice. The Agency Notice shall have attached to it a true, correct and complete copy of the contract of sale or other agreement that governs the rights and obligations of the Agency and the proposed purchaser with respect to the proposed Dispositions (the "Disposition Document"). Any time periods in the Agency Notice shall be deemed extended as necessary to allow the Developer the full thirty (30)-calendar day period following receipt of the Agency's Notice in which to decide whether to exercise the Developer's First Refusal Right. 3 P "_~!!endas'Agenda Aru.chmenl$'.A8enda Anachments'Agenda Attl(:hments Agrmls-Amend 2009 01-20-09 Walson-Wemidgt, LLC _ Amendment ~o 1 FI~AL doc (b) During the thirty (30)-calendar day period following the Developer's actual receipt of the Agency Notice (the "Response Period"), the Developer shall notify the Agency in writing of the election by the Developer to purchase or to not purchase the Offered Property. If the Developer elects to not purchase the Offered Property by delivering written notice of such election to the Agency within the Response Period, the Agency may effect a Disposition of the Offered Property to the proposed purchaser identified in the Agency Notice (i) at a price that is not less than ninety-five percent (95%) of the price that would have been paid by the Developer if the Developer had elected to purchase the Offered Property pursuant to the Agency Notice, and (ii) upon other terms and conditions that are not more favorable to the proposed purchaser than those offered to the Developer in the Agency Notice, provided such closing occurs with the third party purchaser of the Offered Property no later than one hundred eighty (180) calendar days after the expiration of the Response Period, and further provided that if such closing to the proposed purchaser does not occur within such one hundred eighty (180)-calendar day period, the Agency shall again be required to comply with this Section 5 before it makes any other Disposition of the Offered Property. Such Disposition of the Offered Property, if made in accordance with this Amendment No. I, shall be made free and clear of this Amendment No. I but this Amendment No. I shall remain applicable to the remainder of the Property during the remaining Right of First Refusal Term, and the Developer, at the request of the Agency, shall execute and deliver to the Agency the Release Agreement prior to the date of the actual Disposition of the Offered Property insofar as it pertains only to the Offered Property that is so conveyed. (c) If the Developer does not elect to accept the Agency's offer with respect to a Disposition in accordance with the terms hereof, and such Disposition from the Agency is not made on the price and terms set forth in Section 5(b) above subject to the maximum one hundred eighty (180)- calendar day closing period and other terms set forth above, this Amendment No. I shall remain in full force and effect with respect to the Offered Property. (d) Ifthe Developer exercises the First Refusal Right by delivering written notice of such exercise to the Agency within the Response Period, the Developer and the Agency shall close the purchase and sale of the Offered Property in accordance with the terms set forth in the Agency Notice and the Disposition Document. (e) Notwithstanding any provision contained herein to the contrary, in the event: (i) the Developer does not elect to accept the Agency's offer, (ii) the Agency sells the Offered Property pursuant to the terms of this Amendment No. I, and (iii) the Agency retains a lien on the Offered Property and forecloses such lien prior to the expiration of the Right of First Refusal Term, the rights of the Developer under this Amendment No. I with respect to the Offered Property shall be automatically reinstated, and the Agency shall not consummate any further Disposition of the Offered Property without again complying with the terms of Section 5 herein. 6. General Provisions. The Agency and the Developer restate and reaffirm the terms, covenants and conditions of the 2005 DDA. All of the terms, covenants and conditions of the 2005 DDA are in full force and effect except as modified by this Amendment No. I. In the event of any inconsistency, contradiction or ambiguity between the terms, covenants and conditions of the 2005 DDA and this Amendment No. I, the inconsistency, contradiction or ambiguity shall be resolved in favor of this Amendment No. I. This Amendment No. I may not be amended except by written agreement executed by the Agency and by the Developer, is binding on the parties hereto and their 4 P Agendas'Agenda Attachments'Agenda Attlchments".\jjenda AttachmenhAgnnts-Amend 2009'01-20-09 Walson-We.slridgc, LLC - Amendment r<;o I FI~AL doc permitted successors and permitted assigns, and shall be governed by the laws of the State of California. The illegality, invalidity or unenforceability of any provision of this Amendment No. I shall not affect the legality, validity or enforceability of any other provision of this Amendment No. I. The Agency and the Developer have the authority to execute, deliver and perform this Amendment No. I and the persons executing this Amendment No. I on behalf of the Agency and/or of the Developer have the authority to bind the Agency and the Developer to this Amendment No. I. This Amendment No.1 shall bind and run with the Property but shall not be appurtenant to any other property. Upon the expiration of the Right of First Refusal Term or earlier upon the sale of the Property to a third party as permitted pursuant to this Amendment No. I, the Developer shall deliver to the Agency the Quitclaim Deed, as executed and acknowledged by the Developer, in recordable form for recordation in the official records of the county recorder's office for the County of San Bernardino, State of California, reasonably acceptable to the Agency and to a title insurance company to evidence the termination of this Amendment No. I and the termination of any further rights of the Developer pursuant hereto with respect thereto. /// /1/ .'! I " / . I . . II I " . 1/1 /11 /1 1/1 11/ 1// 11/ 1/1 5 r -\!,c"da; ",,!cl1da -\llJcnmel1t., ...."""d. Al1.1cnmerllS .-\gend. J,ll.chmem, .-\!,fml~."'m"nd :00')',,01.:0-09 W.(,on-\\",I"O"" LLC -\mendm~r\1 "0 I FI:--.\L doc IN WITNESS WHEREOF, the Agency and the Developer hereto have duly executed this First Amendment as of the date first written above. AGENCY The Redevelopment Agency of the City of San Bernardino, a public body, corporate and politic Dated: By: Emil A. Marzullo, Interim Executive Director Approved as to Form and Legal Content: By' \ ,~ Agclicy Counsel DEVELOPER Watson-Westridge, LLC, a California limited liability company Dated: By: Name: Title: 6 P 'Agcnda~'Agendil Attachmenls'A~nda Atta~hmo:nn' Agenda AnachmenhAgmlls+..<tuncnd 2009'.01-20-09 Walson-Weslridgc. LLC. Amendment:-';o I FP.>iALdoc Exhibit" A" Release Agreement 7 P 'Agenda~''''''genda Attachments'Agenda Auichmcrm....genda Anachment,.4.gnnts-Amend 200901_20_09 Walson-Weslridge, LLC - Amendment /';0 ] FI~AL dO(: RELEASE AGREEMENT THIS RELEASE AGREEMENT (the "Agreement") is entered into as of this _ day of _, 200 , by and between Watson-Westridge, LLC, a California limited liability company (the "De~eloper") and the Redevelopment Agency of the City of San Bernardino, a public body, corporate and politic (the "Agency"), in light of the facts set forth in the following recitals. In this Agreement, the Agency and the Developer may each be referred to as a "Party" and may collectively be referred to as the "Parties." RECITALS WHEREAS, the Agency and the Developer have executed and entered into that certain 2005 Disposition and Development Agreement, dated as of August 15,2005 (the "2005 DDA"); and WHEREAS, the Agency and the Developer have executed and entered into that certain Amendment No. 1 to the 2005 DDA, dated as of , 200_ (the "Amendment No.1"); and WHEREAS, the Amendment No. 1 provides, without limitation, that: (i) the Developer has a First Refusal Right to purchase from the Agency the Offered Property during the Right of First Refusal Term, (ii) the Developer may elect to purchase or to not purchase the Offered Property, (iii) the Agency shall have the right to sell the Offered Property to an individual or to an entity who is not the Developer nor an affiliate of the Developer should the Developer elect not to purchase the Offered Property, and (iv) at the request of the Agency, the Developer shall execute and deliver to the Agency this Agreement should the Developer elect not to purchase the Offered Property; and WHEREAS, in accordance with the 2005 DDA, as amended by the Amendment No.1: (i) the Agency has offered to sell the Offered Property to the Developer, (ii) the Developer has notified the Agency, in writing, of its election to not purchase the Offered Property, (iii) the Agency has sold or will sell the Offered Property to a person or entity that is not the Developer nor an affiliate of the Developer, and (iv) the Agency has requested the Developer to execute and deliver to the Agency this Agreement; and WHEREAS, in accordance with the 2005 DDA, as amended by Amendment No. I, the Developer has agreed to release all right, title and interest in the Offered Property and in all other Released Claims (as defined below) in accordance v.ith this Agreement. NOW, THEREFORE, IN CONSIDERATION OF THE RECITALS SET FORTH ABOVE, AND FOR SUCH OTHER GOOD AND VALUABLE CONSIDERATION, THE RECEIPT AND SUFFICIENCY OF WHICH ARE HEREBY ACKNOWLEDGED BY AND BETWEEN THE AGENCY AND THE DEVELOPER, THE AGENCY AND THE DEVELOPER AGREE AS FOLLOWS: 1. Recitals and Definitions. The Recitals set forth above are true and correct and are incorporated herein by this reference. Initially capitalized terms not defined in this Agreement shall have the meanings set forth in the Amendment No.1. This Agreement will become effective on the date (the "Effective Date") that this Agreement has been approved and duly executed by the appropriate representatives of the Developer and of the Agency. 8 P '.Agendas Agenda Attachmenls'Agenda Anachments"Agenda AnachmentsAgrmts-Amend 2009'OI.~O-09 Walwn-Wcstridge. LLC . Amendment ~o I H....ALdoc 2. Release. The Developer does hereby fully, completely, finally and forever release and discharge the Agency and its respective officers, partners, members, agents, employees, attorneys, successors, heirs, and assigns from any and all right, title or interest in the Offered Property, including, without limitation, any claims, actions, causes of action, demands, rights, debts, promises, liabilities, damages, accountings, costs and expenses, whether known or unknown, suspected or unsuspected, of every nature whatsoever, whether now or hereafter existing, which the Developer has or may have against the Agency with respect to any and all matters arising out of or in connection with the Offered Property (all of which released matters shall COllectively be referred to as the "Released Claims" and singularly as the "Released Claim"). This release provision shall survive the execution, delivery, performance and early termination of the 2005 DDA, as amended by the Amendment No. I. IT IS THE INTENTION OF THE DEVELOPER HERETO THAT THIS AGREEMENT SHALL BE EFFECTIVE AS A FULL AND FINAL RELEASE OF EVERY RELEASED CLAIM. IN FURTHERANCE OF THIS INTENTION, THE DEVELOPER ACKNOWLEDGES THAT THE DEVELOPER HAS BEEN ADVISED BY LEGAL COUNSEL FOR THE DEVELOPER OF THE LEGAL EFFECT OF THIS AGREEMENT. The Developer acknowledges that hereafter the Developer may discover facts in addition to, or different from, those that the Developer now knows or believes to be true with respect to the subject matter of this Agreement and the Released Claims, but that, notwithstanding the foregoing, it is the intention hereby of the Developer to fully and forever settle and release each of the Released Claims, and that in furtherance of this intention, this release herein given shall be and remain in effect as a full and complete release. 3. Ownership of Released Claims. The Developer hereby represents and warrants to the Agency, as to any Released Claim, the Developer is the sole and absolute owner of each Released Claim released by the Developer, free and clear of all other rights and interest therein, and has the right, ability and sole power to release said Released Claims. The Developer has not, and will not, transfer, convey, assign, encumber, pledge or hypothecate the Released Claim, or any interest therein. 4. Attornevs' Fees. In the event there is any dispute concerning or arising out of the terms of this Agreement or the performance by the Developer hereto with respect to the terms of the Agreement, the prevailing Party in such dispute shall be entitled to recover, in addition to its costs, all attorneys' fees, court costs and expenses reasonably incurred in connection with the dispute. Further; if any action is taken, the Developer agrees to submit to the jurisdiction of the courts of San Bernardino County, State of California. 5. Counterparts. The Agreement may be executed in one (I) or counterparts, each of which shall be deemed an original, and all taken together, shall constitute one and the same original Agreement. 6. Severabilitv. If any provision of this Agreement is held, determined or adjudicated to be illegal, invalid or unenforceable for any reason by any court of competent jurisdiction, such provision shall be severed from the remaining provisions of the Agreement and shall not affect the validity or enforcement of the remaining provisions. 9 PAgendas'Agenda Al1achmenhAgcnda Al1achmenlsAgenda AnachmenlS Agrmls-Amend 2009',01-20-09 Walson.Wcsuidge, LlC _ Amendment:-;o I FI'SAL doc 7. Intel!ration. The Developer and the Agency hereby expressly agree that this Agreement constitutes the entire agreement between the Parties relating to the release by the Developer of the Released Claims. This Agreement supersedes all prior negotiations, promises, covenants, agreements and representations, if any, between the Parties relating to the release by the Developer of the Released Claims. 8. Controllinl! Law. This Agreement shall be interpreted, construed and enforced in accordance with the laws of the State ofCalifomia. 9. Section titles. The section titles in this Agreement are used for convenience only by the Parties and are not to be taken as part of the instrument or used to interpret this Agreement. 10. Interpretation. Whenever the context of this Agreement so requires, the masculine shall include the feminine, or neuter, the feminine shall include the masculine or neuter, the neuter shall include the masculine or feminine, the singular shall include the plural and the plural shall include the singular. II. Amendment. This Agreement may not be altered, amended, modified, or otherwise changed in any respect, except by a \\Titing executed by an authorized representative of each Party. 12. Authorization. The Agency and the Developer represent and warrant to one another that each Party has the authority to execute, deliver and perform this Agreement and that each Party . has taken all necessary action to approve this Agreement. The undersigned, by their signatures, represent and warrant that they are authorized agents of their respective entities and are authorized to execute this Agreement. 13. Successors. This Agreement shall be binding upon and inure to the benefit of the Parties and their respective successors, executors, administrators, trustees, heirs, personal representatives and assigns. End of Page 10 PAgendas'Agenda Attachments'Agenda Attachments"Agenda AttachmenuAgrmIs-Amend 2009'OI.2Q..09 Watson-Weslridge, LLC. Amendment:-';o I FDOALdoc IN WITNESS WHEREOF, the Parties hereto execute this Agreement as of the date first written above. DEVELOPER Watson-Westside, LLC, a California limited liability company By: Name: Title: Dated: AGENCY Redevelopment Agency of the City of San Bernardino, a public body, corporate and politic Dated: By: Emil A. Marzullo, Its Interim Executive Director Approved as to Form and Legal Content: By: Agency Counsel 11 P.-\ge<ndai'Agenda Anachments'.Agenda Anachments Agenda AllachmenlS Agrmls-Amend 2009'0 1-20-09 Walson-W~lridge, LLC . Amendment:-;'o I fl:'<AL doc Exhibit "A" The Offered Property 12 PAgendasAgenda AnachmcnuAgenda Anachmenu' .".genda AnachmenlsAgrmu-Amend ~00901-20-09 Walwn-Wcslridgc. LLC - Amendment:'\'o 1 FJ:-;AL doc Exhibit "8" Quitclaim Deed 13 P'_"'gendas Agenda Anachmenls'Agcnda Anachmenu Agen<1a AnachmenlsAgrmls-Amend 2009 Ol-20-0'l Wat>Qn-Wesuidge, LLC - Amendment ~o I FJ~AL doc RECORDING REQUESTED BY: When Recorded Mail Document and Tax Statement To: Redevelopment Agency of the City of San Bernardino 201 North "E" Street, Suite 301 San Bernardino, California 92401 Attn.: Interim Executive Director SPACE ABOVE THIS LINE FOR RECORDER'S USE QUITCLAIM DEED FOR A V ALUABLE CONSIDERATION, receipt of which is hereby acknowledged, Watson- Westridge, LLC, a California limited liability company (the "Grantor"), hereby remises, releases and quitclaims to the Redevelopment Agency of the City of San Bernardino, a public body, corporate and politic (the "Agency") the following described real property in the City of San Bernardino, County of San Bernardino, State of California: See attached Exhibit "A" IN WITNESS WHEREOF, the Grantor has caused this Quitclaim Deed tobe executed by its authorized officer as of the date indicated next to the signature, below. Watson-Westridge, LLC, a California limited liability company Dated: By: Name: Title: [NOTARY ACKNOWLEDGMENT TO BE ATTACHED] Approved as to Form and Legal Content: By: Agency Counsel 14 f' '.~gtnda~Agel1da Attachments Agenda Attachmtnl~ Agenda Attachments Agrmls.Amend 2009\01-20-09 Watson-Westridgc, llC _ Amendment "'0 I Fr.\ALdoc ACCEPTANCE OF QUITCLAIM DEED BY THE REDEVELOPMENT AGENCY OF THE CITY OF SAN BERNARDINO The undersigned officer of the Redevelopment Agency of the City of San Bernardino, a public body, corporate and politic, hereby acknowledges on behalf of the Agency acceptance of the delivery of the subject property from Watson-Westridge, LLC, a California limited liability company. Redevelopment Agency of the City of San Bernardino. a public body, corporate and politic Dated: By: Emil A. Marzullo, Interim Executive Director [NOTARY ACKNOWLEDGMENT TO BE ATTACHED] 15 P 'Agendas'Agenda AltlchmenfS'..o\genda AnachmentsAgtnda Anachments Agrmls-Amend 2009'.01.20-09 Wauon-Weslrid!tt. LLC - Amendment:-';o 1 F~A.L doc Exhibit" A" Legal Description of the Property 16 P "Agendas'Agenda Attachmems'Agcnda Anachmalls'Agemu AnachmcnlfAgrmts.Amend 2009 Ol.2Q..09 Walson-Wcmidge, LLC - Amendment No 1 FINALdoc