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HomeMy WebLinkAbout2005 08-23 CC ADJ AGENDA PKTCity of National City Joint Meeting Agenda Adjourned Regular Meeting of the City Council Regular Meeting of the Community Development Commission City Council Chambers Civic Center 1243 National City Boulevard National City, California Tuesday — August 23, 2005 - 6:00 P.M. Open To The Public Please complete a request to speak form prior to the commencement of the meeting and submit it to the City Clerk. It is the intention of your City Council to be receptive to your concerns in this community. Your participation in local government will assure a responsible and efficient City of National City. We invite you to bring to the attention of the City Manager any matter that you desire the City Council to consider. We thank you for your presence and wish you to know that we appreciate your involvement. Pledge of Allegiance to the Flag by Mayor Nick Inzunza Public Oral Communications (Three -Minute Time Limit) NOTE: Pursuant to state law, items requiring Council action must be brought back on a subsequent Council Agenda unless they are of a demonstrated emergency or urgent nature. Upon request, this agenda can be made available in appropriate alternative formats to persons with a disability in compliance with the Americans with Disabilities Act. Please contact the City Clerk's Office at 336-4228 to request a disability -related modification or accommodation. Notification 24 hours prior to the meeting will enable the City to make reasonable arrangements to ensure accessibility to this meeting. Spanish audio interpretation is provided during Council Meetings. Audio headphones are available in the lobby at the beginning of the meetings. Audio interpretacidn en espanol se proporciona durante sesiones del Consejo Municipal. Los audiofonos estan disponibles en el pasillo al principio de la junta. I Council Requests That All Cell Phones And Pagers Be Turned Off During City Council Meetings COPIES OF THE CITY COUNCIL MEETING AGENDAS AND MINUTES MAY BE OBTAINED THROUGH OUR WEBSITE AT www.ci.national-city.ca.us Council and CDC AGENDA 8/23/05 PAGE 2 JOINT PUBLIC HEARING 1. JOINT PUBLIC HEARING: of the City Council and the Community Development Commission on the proposed Disposition and Development Agreement by and between the Community Development Commission and Mossy Nissan, Incorporated for the development of a new car dealership located at 2626 through 2700 National City Boulevard Community Development Commission 2. RATIFICATIONS: Expenditures for the period of 07/27/05 through 08/12/05 3. PUBLIC HEARING AND RESOLUTION NO. 2005-83: of the Community Development Commission of the City of National City approving the Health and Safety Code Section 33433 Report; approving the Disposition and Development Agreement by and between the Community Development Commission and Mossy Nissan, Incorporated for development of a new car dealership located at 2626 through 2700 National City Boulevard; making certain findings in connection herewith; and authorizing the transmittal of said Report to the City Council 4. PUBLIC HEARING AND RESOLUTION NO. 2005-84 Public Hearing of the Community Development Commission of the City of National City to consider public necessity in conjunction with the acquisition of Real Property located at 2626 through 2700 National City Boulevard, and Resolution of Necessity of the Community Development Commission of the City of National City to acquire Real Property located at 2626 through 2700 National City Boulevard, owned by the Dailey Family Partnership, by eminent domain 5. RESOLUTION NO. 2005-85: authorizing the expenditure of funds for office remodeling services and authorizing the Executive Director to enter into an agreement with Office Pavilion for office remodeling services 6. RESOLUTION NO. 2005-86: authorizing the Chairman to enter into an Exclusive Negotiation Agreement with NC Plaza Development, LLC for the development of a mixed -use condominium and retail project on assessor's parcel numbers 556- 471-03, 04, 17 and 556-553-01, 02, 03, 04, 05, 06, 08, 09, 12, and 13 7. REPORT: Update and presentation of Filipino Village Projects 2 Council and CDC AGENDA 8/23/05 PAGE 3 City Council 8. RESOLUTION NO. 2005-184: of the City Council of the City of National City approving the Health and Safety Code Section 33433 Report; approving the Disposition and Development Agreement by and between the Community Development Commission and Mossy Nissan, Incorporated for development of a new car dealership at 2626 through 2700 National City Boulevard; and making certain findings in connection herewith 9. RESOLUTION NO. 2005-185: of the City Council of the City of National City establishing the property tax rate for bonded indebtedness for fiscal year 2005-06 CLOSED SESSION: Public Employee Performance Evaluation - Government Code Section 54957 Title: Executive Director, CDC CLOSED SESSION: Conference with Legal Counsel — Anticipated Litigation Significant Exposure to Litigation Pursuant to Government Code Section 54956.9(b) (One potential case) STAFF: MAYOR/CHAIRMAN: COUNCILMEMBERS/COMMISSIONERS: ADJOURNMENT: Next Regular City Council Meeting — Tuesday — September 6, 2005 - 6:00 p.m. Council Chambers, Civic Center Next Regular CDC Meeting — Tuesday — September 13, 2005 - 6:00 p.m. — Council Chambers, Civic Center TAPE RECORDINGS OF EACH CITY COUNCIL MEETING ARE AVAILABLE FOR SALE IN THE CITY CLERK'S OFFICE 3 COUNCIL AND COMMUNITY DEVELOPMENT COMMISSION AGENDA OF THE CITY OF NATIONAL CITY MEETING DATE: August 23, 2005 AGENDA ITEM NO. .ITEM TITLE: JOINT PUBLIC HEARING ON THE PROPOSED DISPOSITION & DEVELOPMENT AGREEMENT BY AND BETWEEN THE COMMUNITY DEVELOPMENT COMMISSION AND MOSSY NISSAN, INCORPORATED, fOR THE DEVELOPMENT OF A NEW CAR DEALERSHIP LOCATED AT 2626 THROUGH 2700 NATIONAL CITY BOULEVARD PREPARED BY: Benjamin Martinez DEPARTMENT Community Development Commission Executive Director EXPLANATION: Mossy Nissan, Incorporated proposes to develop a new automobile dealership on a 4.53 acre site lo- cated at 2626 through 2700 National City Boulevard in the National City Mile of Cars. To facilitate de- velopment of this proposed project, a Disposition & Development Agreement has been prepared, which is being processed pursuant to the requirements of the California Redevelopment Law (California Health and Safety Code Section 33000 et seq.). A Supplemental • Staff Report has been prepared and attached to provide more information on the proposed Mossy Nissan Project. A Public Notice was published in the National City Star News on August 5 and 12, 2005. /Environmental Review N/A 1 The City Council adopted the Combined General Plan/Zoning Map on September 10, 1996 with Amendments GP-2000-1,2,3 and GP-2001-2 and GP-2002-1. The project is consistent with the Certi- fied Environmental Impact Report adopted for the Combined General Plan/Zoning Map. Pursuant to Section 15183 of the California Environmental Quality Act Guidelines, the project is deemed exempt from further CEQA review. Financial Statement The DDA anticipates no public expenditures. STAFF RECOMMENDATION Conduct the public hearing. BOARD/COMMISSION RECOMMENDATION None. ATTACHMENTS (Listed Below) Resolution No. 1. Supplemental Staff Report 3. Proposed Disposition and Development Agreement 2. Public Hearing Notice 4. 33433 Summary Report PROPOSED DISPOSITION AND DEVELOPMENT AGREEMENT BY AND BETWEEN THE COMMUNITY DEVELOPMENT COMISSION AND MOSSY NISSAN, INCORPORATED FOR THE DEVELOPMENT OF A NEW CAR DEALERSHIP LOCATED AT 2626 THROUGH 27-00 NATIONAL CITY BOULEVARD SUPPLEMENTAL STAFF REPORT Public Notification: Pursuant to Section 33433 of the California Health & Safety Code, a Joint Public Hearing Notice was published in the Star News on August 5 and 12, 2005. Fiscal Impact: Pursuant to Section 33433 of the California Health & Safety Code, a financial summary report has been prepared to evaluate the financial considerations under the terms of the proposed Disposition and Development Agreement, as well as the economic benefits of the proposed project to both the Community Development Commission and National City. A copy of the completed 33433 Financial Report has been attached for review. The Disposition and Development Agreement provides that Mossy Nissan, Inc. will purchase the site for $7 Million plus expenses incurred by the Community Development Commission in acquiring the property. The price is the Fair Market Value as determined by an independent appraisal dated May 27, 2005. There is no subsidy involved in this project. It is anticipated that $152,000 in increased real estate taxes will be generated per year to fund the following: • CDC: $115,447 • Affordable Housing: $30,400 • Office of Education: $3,220 • Southwestern College: $2,933 The project is expected to yield additional sales tax revenues of $300,000 annually to the City of National City. Environmental Impact: The project is consistent with the Certified EIR for the Redevelopment Plan for National City Redevelopment Project certified by Resolution No. 95-98 on June 20, 1995, for the National City General Plan and with the Zoning Designation of Automotive Commercial for the National City Mile of Cars and, consistent with Section 15180 of the California Environmental Quality Act Guidelines, does not require additional analysis. Attachment 1 Property Description: The subject property is located at 2626 through 2700 National City Boulevard in the National City Mile of Cars. The site is comprised of two (2) parcels containing a total of approximately 4.53 acres. The San Diego County Assessor's Parcel Numbers for the subject property are 562- 340-47 and 562-340-48. Project Description: Mossy Nissan, Incorporated proposes to develop a new Nissan Auto Dealership on the site of the existing Mossy Nissan Dealership in the National City Mile of Cars. The project will include the demolition of most of the existing structure and redevelopment of a $3 million new facility. Designs for the project will be finalized and submitted over the Planning Counter for review. Financial Considerations of the Proposed DDA: The fair market value of the subject property, according to the Community Development Commission's appraiser, is $7 Million ($7,000,000). The price to be paid to the Community Development Commission for the property by Mossy Nissan, Incorporated shall be: (1) in the event the property is acquired by the Community Development Commission through a negotiated purchase, the actual price paid by the Community Development Commission for the property, plus any other acquisition costs incurred to that date, or (2) in the event the property is acquired by the Community Development Commission through eminent domain proceedings, the amount of just compensation awarded to the owner of the property, plus the amount of acquisition costs incurred by the Community Development Commission. Economic Benefits: Health and Safety Code Section 33433 Report: On August 8, 2005, the CDC's redevelopment financial consultant (KMA) completed a financial summary report, pursuant to Section 33433 of the California Health & Safety Code. The purpose of this report is to evaluate the financial considerations in order to determine economic benefits of the CDC's participation in this proposed DDA. A copy of this 33433 Financial Summary Report is attached for your review. It is anticipated that $152,000 in increased real estate taxes will be generated per year to fund the following: • CDC: $115,447 • Affordable Housing: $30,400 ■ Office of Education: $3,220 • Southwestern College: $2,933 The project is expected to yield additional sales tax revenues of $300,000 annually to the City of National City. 2 NOTICE OF A JOINT PUBLIC HEARING OF THE CITY COUNCIL OF THE CITY OF NATIONAL CITY AND THE COMMUNITY DEVELOPMENT COMMISSION ON THE PROPOSED MOSSY NISSAN PROJECT The City Council of the City of National City and the National City Community Development Commission (CDC) will hold a Joint Public Hearing after the hour of 6:00 p.m. Tuesday, August 23, 2005, in the City Council Chambers, Civic Center, 1243 National City Boulevard, National City, on the proposed Disposition & Development Agreement (DDA) and Owner Participation Agreement for the proposed Mossy Nissan project. Any person interested in this matter may appear at the above time and place and be heard. Mossy Nissan, Inc., is proposing the development of a new automobile dealership on 4.53 acres located at 2626 and 2700 National City Boulevard within the National City Mile of Cars. The dealership will be constructed to accommodate anticipated increased sales volume forecasts of Nissan Motors for the next five years and beyond. The purpose of the Joint Public Hearing is to provide for public comment, in accordance with Sections 33433 and 33445 of the California Health & Safety Code, regarding the proposed terms and conditions for the sale of land proposed in a Disposition & Development Agreement (DDA) by and between the CDC and Mossy Nissan, Inc., for the real property located at 2626 and 2700 National City Boulevard. Said land is proposed to be sold for the development of the Mossy Nissan project. A copy of the proposed DDA, a summary report pertaining to the sale of real property pursuant to the proposed Agreement, and other documentation required by Section 33445 of the California Health & Safety Code for the proposed Mossy Nissan project may be reviewed at the office of the Community Development Commission, at 140 East 12th Street, Suite B, National City, and the City Clerk's Office, 1243 National City Blvd., National City as of August 9, 2005. Members of the public are invited to comment. Written comments should be received by the Community Development Commission on or before 3:00 p.m., August 17, 2005. Any questions regarding this matter should be directed to Patricia Beard at (619) 336-4250. If you challenge the nature of the proposed action in court, you may be limited to raising only those issues you or someone else raised at the public hearing described in this notice, or in written correspondence delivered to the public hearing entity conducting the hearing at, or prior to, the public hearing. MICHAEL DALLA City Clerk PUBLISHED IN THE NATIONAL CITY STAR NEWS, Friday, August 5 and August 12, 2005 Attachment 2 DISPOSITION AND DEVELOPMENT AGREEMENT By and Between the COMMUNITY DEVELOPMENT COMMISSION OF THE CITY OF NATIONAL CITY and MOSSY NISSAN, INC. Attachment 3 017.262230.5 Y Attachment No. 1 Attachment No. 2 Attachment No. 3 Attachment No. 4 Attachment No. 5 Attachment No. 6 Attachment No. 7 Site Map Site Legal Description Grant Deed Schedule of Performance Scope of Development Release of Construction Covenants Operating Covenant 017.262230.5 DISPOSITION AND DEVELOPMENT AGREEMENT THIS DISPOSITION AND DEVELOPMENT AGREEMENT (this "Agreement") is entered into as of August 23, 2005, by and between the COMMUNITY DEVELOPMENT COMMISSION OF THE CITY OF NATIONAL CITY, a public body, corporate and politic (the "CDC"), on the one hand, and MOSSY NISSAN, INC., a Califomia corporation (the "Developer") on the other. RECITALS The following recitals are a substantive part of this Agreement: A. In furtherance of the objectives of the California Community Redevelopment Law, the CDC desires to redevelop a certain approximately 4.53 acre portion of the National City Redevelopment Project (the "Redevelopment Project") located at 2626 and 2700 National City Boulevard (APNs 562-340-47 and -48) (the "Property" or the "Site", more fully described below) in the City of National City (the "City"). B. The CDC and Developer desire by this Agreement for the Developer to redevelop and remodel upon the Property a new automobile sales, service and repair facility (the "Project"). C. The CDC and Developer (singularly, a "Party"; jointly the "Parties") desire to cause the Property to be redeveloped in order to aid in alleviating blighted conditions and to stimulate economic development in the Redevelopment Project area. D. In order to accomplish the successful completion of the Project, subject to the terms and conditions of this Agreement, the Agency may acquire the Property and convey the Property to Developer in order to enable Developer to construct the Project. E. The completion of the Project is in the vital and best interest of the City and the health, safety, morals and welfare of its residents, and in accord with the public purposes and provisions of applicable state and local laws and requirements under which the redevelopment of the Redevelopment Project has been undertaken. NOW, THEREFORE, the CDC and the Developer agree as follows: 100. DEFINITIONS "Acquisition Costs" is defined in Section 203. "Agreement" means this Disposition and Development Agreement between the CDC and the Developer. "Attachments" to this Agreement are integral parts of the Agreement and are as enforceable as if set forth in the body of the Agreement. 017.262230.5 "Basic Concept Drawings"means the initial drawings for the Project showing site plans, elevations and landscape features for the Project that have been submitted by the Developer and approved by the CDC concurrently with the approval of this Agreement. "CDC" or "Agency" means the Community Development Commission of The City of National City, a public body, corporate and politic, exercising governmental functions and powers and organized and existing under Chapter 2 of the Community Redevelopment Law of the State of California, Health and Safety Code, Section 33000, et seq., and any assignee of or successor to its rights, powers and responsibilities. "CDC's Conditions Precedent" means the conditions precedent to the Closing for the benefit of the CDC, as set forth in Section 208.1 hereof. "City" means the City of City of National City, a California municipal corporation. "Closing" means the close of Escrow for the Conveyance of the Property from the CDC to the Developer, as set forth in Section 205.4 hereof. "Closing Date" means the date of the Closing, as set forth in Section 205.4 hereof. "Condition of Title" is defined in Section 206 hereof. "Construction Drawings" means the detailed construction drawings and plans to be prepared with respect to the Improvements, as set forth in Section 302.2 hereof. "Conveyance" means the conveyance of the Property by the CDC to the Developer on the Closing Date. "Date of Agreement" means the date set forth in the first paragraph hereof. "Default" means the failure of a party to perform any action or covenant required by this Agreement within the time periods provided herein following notice and opportunity to cure, as set forth in Section 501 hereof. "Developer" means Mossy Nissan, Inc., a California corporation or its assignee pursuant to Section 603.1. "Developer's Conditions Precedent" means the conditions precedent to the Closing for the benefit of the Developer, as set forth in Section 208.2. "Developer Deposits" is defined in Section 202 hereof. "Enforced Delay" is defined in Section 602. "Environmental Laws"means shall mean any and all federal, state and local statutes, ordinances, orders, rules, regulations, guidance documents, judgments, governmental authorizations, or any other requirements of governmental authorities presently relating to the release, generation, use, handling, treatment, storage, transportation or disposal of Hazardous 2 017.262230.5 Materials, or the protection of the environment or human, plant or animal health. "Environmental Laws" include, without limitation, (i) the Comprehensive Environmental Response, Compensation, and Liability Act (42 U.S.C. § 9601 et seq.), (ii) the Hazardous Materials Transportation Act (94 U.S.C. § 1801 et seq.), (iii) the Resource Conservation and Recovery Act (42 U.S.C. § 6901 et seq.), (iv) the Federal Water Pollution Control Act (33 U.S.C. § 1251 et seq.), (v) the Clean Air Act (42 U.S.C. § 7401 et seq.), (vi) the Toxic Substances Control Act (15 U.S.C. § 2601 et seq_), (vii) the Oil Pollution Act (33 U.S.C. § 2701 et seq.), (viii) the Emergency Planning and Community Right -To -Know Act (U.S.C. § 11001 et seq.), (ix) the Porter -Cologne Water Quality Control Act (Cal. Water Code § 13020 et seq.), (x) the Safe Drinking Water and Toxic Enforcement Act of 1986 (Cal. Health & Safety Code § 25300 et seq.), (xi) the Hazardous Waste Control Act (Cal. Health & Safety Code § 25100 et seq.), (xii) the Carpenter -Presley -Tanner Hazardous Substance Account Act (Cal. Health and Safety Code § 25316 et seq.), (xiii) the Hazardous Materials Release Response Plans and Inventory (Cal. Health & Safety Code § 25501 et seq.), (xiv) Cal. Health and Safety Code § 25281 (Underground Storage of Hazardous Substances), (xv) Article 9 or Article 11 of Title 22 of the California Administrative Code, Division 4, Chapter 20, and other applicable provisions of the California Health and Safety Code, Water Code, and Government Code as amended or supplemented and any analogous present federal, state or local statutes, ordinances or laws, and any regulations promulgated pursuant to any of the foregoing. "Escrow" is defined in Section 205 hereof. "Escrow Costs" is defined in Section 205.1 hereof. "Escrow Holder" is defined in Section 205 hereof. "Governmental Requirements"means all laws, ordinances, statutes, codes, rules, regulations, orders and decrees of the United States, the State of California, the County of San Diego, the City, or any other political subdivision in which the Property is located, and of any other political subdivision, CDC or instrumentality exercising jurisdiction over the CDC, the Developer or the Property. "Grant Deed" means the grant deed for the conveyance of the Property from the CDC to the Developer, in the form of Attachment No. 3 hereto which is incorporated herein by reference. "Hazardous Materials" means any substance, material, or waste which is or becomes, regulated by any local governmental authority, the State of California, or the United States Government, including, but not limited to, any material or substance which is (i) defined as a "hazardous substance," "hazardous waste," "extremely hazardous waste," or "restricted hazardous waste" under Environmental Laws, (ii) petroleum, (iii) friable asbestos, (iv) polychlorinated byphenyls, (v) methyl tertiary butyl ether, or (vi) any other substance, whether in the form of a solid, liquid, gas or any other form whatsoever, which by any Governmental Requirements either requires special handling in its use, transportation, generation, collection, storage, handling, treatment or disposal, or is defined as "hazardous" or harmful to human health or the environment. 017.262230.5 "Improvements" means the improvements to be constructed by the Developer upon the Property, all more particularly described in Section 301.1 hereof and in the Scope of Development. "Notice"means a notice in the form prescribed by Section 601 hereof. "Operating Covenant" means the Operating Covenant in the form of Attachment No. 7 hereto which is incorporated herein by reference. hereof. "Outside Date" means the last date the Closing shall occur, as set forth in Section 205.4 "Parties" means the CDC and the Developer. "Permitted Exceptions" means the following exceptions to title with respect to the Property: (1) applicable building and zoning laws and regulations; (2) the provisions of this Agreement; (3) the Operating Covenant; (4) any lien for current taxes or taxes accrued subsequent to Closing; (5) such other conditions, covenants, restrictions or easements of record as may be expressly approved by the Developer in writing; and (6) the liens, encumbrances, conditions and other matters set forth in the Report approved by Developer pursuant to Section 206. "Possession Deposit" is defined in Section 202. "Project" means the Property and the Improvements. "Property" or "Site" means the approximately 4.53 acre portion of the Redevelopment Project located at 2626 and 2700 National City Boulevard in the City, which is legally described in the Property Legal Description and depicted on the Site Map. "Property Legal Description"means the legal description of the Property in Attachment No. 2. "Purchase Price" means the price to be paid by the Developer to the CDC in consideration for the Conveyance of fee title to the Property, as set forth in Section 204.2 hereof. "Redevelopment Plan" means the Redevelopment Plan for the Redevelopment Project, adopted by Ordinance No. 95 - 2095 of the City Council of the City of National City, and incorporated herein by reference. 4 017.262230.5 "Redevelopment Project" means the National City Redevelopment Project, adopted by the City pursuant to the Redevelopment Plan. "Release of Construction Covenants" means the document, which evidences the Developer's satisfactory completion of the Improvements, as set forth in Section 309 hereof, in the form of Attachment No. 6 hereto which is incorporated herein. "Report" means the preliminary title report, as described in Section 206 hereof. "Schedule of Performance" means the Schedule of Performance in Attachment No. 4, setting out the dates and/or time periods by which certain obligations set forth in this Agreement must be accomplished. The Schedule of Performance is subject to revision from time to time as mutually agreed upon in writing between the Developer and the CDC's Director. Unless otherwise specified herein, the CDC's Director is authorized to make such revisions, as he or she deems reasonably necessary. "Scope of Development" means the Scope of Development in Attachment No. 5, that describes the scope, amount and quality of development of the Improvements to be constructed by the Developer pursuant to the terms and conditions of this Agreement. "Site Map" means the depiction of the Property in Attachment No. 1. "Title Company" is defined in Section 206 hereof. "Title Policy" is defined in Section 207 hereof. "Transfer" is defined in Section 603 hereof. "Triple Net Lease" is defined in Section 203.3 hereof. 200. ACQUISITION AND CONVEYANCE OF THE SITE 201. Developer Efforts to Acquire Property. The Developer has attempted to acquire the Property. During the time after Developer executes this Agreement and the time at which the CDC may approve this Agreement, the Developer shall continue to negotiate for the acquisition of the Property in good faith with the owners of the Property. CDC will reasonably determine that Developer has made such good faith efforts to acquire the Property. Developer, to the extent its negotiations are unsuccessful with respect to the acquisition of the Property, desires CDC to assist in the acquisition of the Property and to consider the possible use of its eminent domain powers. Should the CDC acquire the Property, Developer desires the CDC to transfer the Property to it. In connection with any such acquisition, CDC shall determine in good faith and within its sole, absolute and independent discretion, whether it will or will not adopt a resolution of necessity and proceed with eminent domain. Developer acknowledges and agrees that the CDC has not pre -committed itself to commencement of eminent domain proceedings with respect to the Property and the CDC reserves the right, in its sole and absolute discretion, to approve or disapprove a resolution of necessity in connection therewith. Unless and until CDC decides to utilize its power of eminent domain as provided in Section 202, this Agreement does 017.262230_5 5 not bind the CDC to exercise its power of eminent domain, and CDC's failure to exercise said power shall not constitute a default by CDC hereunder. 202. Acquisition by Eminent Domain. If the CDC in its absolute and sole discretion decides, following appropriate hearings and evidence presented, to utilize its eminent domain power for the acquisition of the Property, provided Developer is timely making all Developer Deposits and paying all Acquisition Costs as set forth below in this Agreement, CDC will use its best efforts and diligently follow the Eminent Domain Law of the State of California and not voluntarily terminate or stop such proceeding. Developer shall be responsible for and shall advance to CDC, from time to time, upon written request of the CDC, all sums necessary for the completion of such proceedings (the "Developer Deposits"), including, without limitation, all Acquisition Costs, including, but not limited to, court costs, deposits necessary to obtain orders for pre judgment possession (the "Possession Deposit"), the amount of just compensation set forth in any final judgment of condemnation, payments for loss of business goodwill or pre - condemnation damages, relocation expenses and costs, any interest awarded by the court to the Property owner (net of any interest received by the CDC on the Possession Deposit, if any), title and litigation guarantees and any and all associated costs. The CDC shall use (again assuming it has decided after full and fair hearings to proceed with the acquisition) its best efforts to pro rate taxes, assessments, and other charges applicable to the Property as of the date of CDC's acquisition. Any advances requested by CDC shall be tendered by Developer by wire transfer or cashiers check within five (5) business days of receipt of CDC's written demand. 203. Acquisition Costs. For the purposes of this Agreement the term "Acquisition Costs" shall refer to any and all costs and expenses set forth in Section 202 above (whether previously advanced by Developer or not) as well as all other costs and expenses contemplated as being the responsibility of the Developer under this Agreement. Acquisitions Costs shall also include any and all costs and expenses of CDC in acquiring or attempting to acquire the Property through a negotiated purchase and enforcing its right to require Developer Deposits and supplements thereto pursuant to Section 202 above and this Section 203. In the event of termination of this Agreement at any time for any reason other than CDC's Default, Developer's obligation to pay Acquisition Costs shall survive the termination of this Agreement with respect to all Acquisition Costs (collectively, the "Post Termination Costs") either: (i) paid or incurred but not yet billed or paid as of such termination, or (ii) arising from (a) the subsequent abandonment of any eminent domain action as provided in Section 203.2, including, without limitation, any litigation expenses for which CDC may be responsible under California Code of Civil Procedure Section 1268.610 and/or damages under Section 1268.620 (including, but not limited to attorneys fees) and (b) any claims, actions, or other causes arising out of or related to actions taken by CDC prior to such termination. Developer hereby agrees to indemnify, defend and hold harmless the CDC, its elected officials, officers, employees and agents from and against any and all claims, losses, liabilities, costs, expenses (including reasonable attorneys' fees), actions, causes of action, penalties or interest arising out of or in connection with any third party objections to CDC efforts to acquire the Property through a negotiated purchase or exercise of its power of eminent domain, including, without limitation, the adoption of any resolution of necessity or the filing of any complaint in eminent domain. If an eminent domain action is commenced, abandonment thereof sought, but the judge in such action for any reason does not allow the abandonment of the action, Developer shall be obligated to pay all awards, damages, costs and expenses awarded to the property owner in such action as "Acquisition Costs". 6 017.262230.5 Developer shall deliver to CDC all Acquisition Costs (not previously advanced by Developer) and all Post Termination Costs within thirty (30) days after written demand from the CDC. Subject to the indemnification provisions above, CDC shall bear all costs incurred by CDC regarding the Property and this Agreement up to the date hereof. In carrying out its rights and obligations pursuant to this Agreement, CDC is authorized to select and hire those consultants, appraisers, expert witnesses, legal counsel, and other professionals as CDC deems necessary to effectuate and complete its rights and obligations hereunder and under the law of the State of California. Reasonable costs incurred by CDC for such consultants, appraisers, expert witnesses, legal counsel and other professionals shall be considered part of the Acquisition Costs. The payment of such amounts by Developer to CDC for any of these costs shall be effected within thirty (30) days of the date of mailing of such invoice and/or billing. 203.1 Possession Deposit. Notwithstanding anything set forth in Section 202 above, Developer and CDC understand and agree that Developer may not be in a position to make the Possession Deposit in which event it will not be possible to secure an order of possession in any eminent domain action prior to the entry of a judgment in any such action. Accordingly, in the event CDC decides to utilize its power of eminent domain, CDC shall not file a complaint for eminent domain for the Property until Developer advises CDC that it elects to have CDC seek an order of possession prior to the entry of judgment in any such action. Developer shall make such election no later than the last date set forth therefore in the Schedule of Performance. If and when the CDC decides to utilize its power of eminent domain, and if and when Developer timely elects an order of possession in any such action prior to entry of judgment, the CDC and Developer shall reasonably cooperate with Developer's lender and the Title Company in an effort to provide Developer's lender with security provided by Developer, including without limitation, an assignment of this Agreement as security and secure title insurance coverage for Developer and/or Developer's lender in connection with any Possession Deposit sufficient to cause said lender to advance the Possession Deposit to Developer. The failure of Developer to both timely elect an order of possession and to timely make the Possession Deposit shall result in all of Developer's rights ceasing under this Agreement while all of Developer's obligations pursuant to Section 203 shall continue. Time is of the essence in connection with this Section 203.1. In the event that Developer fails to timely make the Possession Deposit and the valuation date in any eminent domain action is changed and/or lost, Developer agrees to indemnify, defend and hold harmless the CDC, its elected officials, officers, employees and agents from and against any and all claims, liabilities, costs, expenses (including reasonable attorneys' fees), actions, causes of action, penalties or interest arising out of or in connection with change in or loss of the valuation date. 203.2 Option to Abandon Eminent Domain Action. If and after such time as the CDC may decide to commence a condemnation action in connection with the Property pursuant to its power of eminent domain, notwithstanding Developer's obligations pursuant to Section 202 above to pay all sums necessary for the completion of any such action, including, but not limited to, the Possession Deposit and the amount necessary to satisfy any judgment in such an action, if the judgment in such action is greater than Eight Million Dollars ($8,000,000), or at such time as it becomes apparent in the reasonable judgment of the Developer and CDC that the judgment in such an action will exceed $8,000,000, unless additional funding is then 7 017.262230.5 available from the CDC or other third party source, at the option of Developer, to be exercised by written notice to CDC, the CDC shall attempt to abandon the condemnation action whereupon (i) Developer shall remain liable for all Acquisition Costs and Post Termination Costs set forth above in Sections 202 and 203, and (ii) this Agreement shall terminate. 203.3 Triple Net Lease. Beginning on the date that any order for possession pursuant to California Code of Civil Procedure §§ 1255.410 et seq. may become effective, or such other date that the CDC obtains possession of the Property, CDC agrees to lease the Property to Developer pursuant to a triple net lease for Ten Dollars ($10) per month rent with Developer being completely responsible for any and all costs of the Property and CDC having no obligations whatsoever in connection with any repairs or modifications or costs and expenses of the Property (the "Triple Net Lease"). Developer and CDC agree to use a modified version of the AIR Single Tenant Lease -Net form for the Triple Net Lease. 204. Sale and Purchase. 204.1 Purchase and Sale. if Developer is unable to acquire the Property through its own efforts and in the event that CDC, following public hearings and receiving evidence, acquires the Property either through eminent domain or otherwise, then in accordance with and subject to all of the terms, conditions and covenants of this Agreement, CDC agrees to sell and Developer agrees to buy the Property. 204.2 Purchase Price. The Purchase Price to be paid by Developer for the Property ("Purchase Price") shall be: (a) In the event the Property is acquired by CDC through a negotiated purchase, the actual price paid by CDC for the Property, plus any other Acquisition Costs incurred to that date; or (b) in the event the Property is acquired by CDC through eminent domain proceedings, the amount of just compensation awarded to the owner of the Property, plus the amount of Acquisition Costs incurred by CDC. The actual Purchase Price shall be determined in accordance with the mandates of Section 33433 of the Health and Safety Code, if applicable, and shall not be less than the fair market value of the Property. The Developer Deposits shall be applied to the Purchase Price at the close of Escrow. In the event that CDC acquires the Property through its power of eminent domain or otherwise, the provisions of the sections below shall apply. 205. Escrow. The Parties shall open escrow ("Escrow") no later than thirty (30) days after CDC acquires title to the Property with Commonwealth Land Title Company, 1455 Frazee Road, Suite 600, San Diego, California 92108 or other title company mutually agreeable to the parties ("Escrow Holder"). 205.1 Costs of Escrow. CDC shall pay the premium for a standard CLTA Title Policy as set forth in Section 207 hereof and the documentary transfer taxes, if any, due with respect to the conveyance of the Property by CDC. Developer shall pay the added cost of an ALTA Extended Owners Policy if elected by Developer plus the cost of any required ALTA survey and/or endorsements. All other usual fees, charges and costs which arise from Escrow ("Escrow Costs") shall be paid by CDC and Developer, one-half by each. 8 017.262230.5 205.2 Escrow Instructions. This Agreement constitutes the joint escrow instructions of CDC and Developer, and Escrow Holder, to whom these instructions are delivered, is hereby empowered to act under this Agreement. The Parties hereto agree to do all acts reasonably necessary to close Escrow in the shortest possible time. Insurance policies for fire or casualty are not to be transferred, and CDC will cancel its own policies, if any, after the Closing. All funds received in the Escrow shall be deposited with other escrow funds in a general escrow account(s) and may be transferred to any other such escrow trust account in any state or national bank doing business in the State of California. All disbursements shall be made by check from such account. However, if Escrow does not close within five (5) business days from deposit of the Purchase Price, the funds shall be deposited into an interest bearing account with such interest accruing to the benefit of Developer. If, in the opinion of either Party or the Escrow Holder, it is necessary or convenient in order to accomplish the Closing, such Party may require that the Parties sign supplemental escrow instructions within fifteen (15) days of notice thereof; provided that, if there is any inconsistency between this Agreement and the supplemental escrow instructions, then the provisions of this Agreement shall control. The Parties agree to execute such other and further documents as may be reasonably necessary, helpful or appropriate to effectuate the provisions of this Agreement. The Closing shall take place within thirty (30) days after the date when both the CDC's Conditions Precedent and the Developer's Conditions Precedent as set forth in Sections 208.1 and 208.2 have been satisfied or waived by the respective Party. Escrow Holder is instructed to release CDC's escrow closing statements and Developer's escrow closing statements to the other Party. 205.3 Authority of Escrow Holder. Escrow Holder is authorized to, and shall: (a) Pay and charge Developer and CDC for their respective shares of the Escrow Costs payable under Section 205.1 of this Agreement. (b) Disburse funds and deliver and record the Grant Deed and Operating Covenant, when both the Developer's Conditions Precedent and the CDC's Conditions Precedent have been fulfilled or waived by Developer and CDC. (c) Do such other actions as necessary, including obtaining the Title Policy, to fulfill its obligations under this Agreement. (d) Within the discretion of Escrow Holder, direct CDC and Developer to execute and deliver any instrument, affidavit and statement and to perform any act reasonably necessary to comply with the provisions of FIRPTA and any similar state act and regulation promulgated thereunder. CDC agrees to execute a Certificate of Non -Foreign Status and/or a Certification of Compliance with Real Estate Reporting Requirement of the 1986 Tax Reform Act as may be required by Escrow Holder and a California Form 593-C (if applicable), on the form to be supplied by Escrow Holder. (e) Prepare and file with all appropriate governmental or taxing authorities a uniform settlement statement, closing statement, tax withholding forms including an 017.262230.5 9 IRS 1099-S form, and be responsible for withholding taxes, if any such forms as provided for or required by law. 205.4 Closing. This transaction shall close ("Closing") within thirty (30) days of the parties' satisfaction of all of CDC's and Developer's Conditions Precedent to Closing as set forth in Section 208 hereof, but in no event later than December 31, 2007 (the "Outside Date"). The Closing shall occur at the offices of Escrow Holder or other location within San Diego County at a time and place reasonably agreed on by the parties. The "Closing" shall mean the time and day the Grant Deed is filed for record with the San Diego County Recorder. The "Closing Date" shall mean the day on which the Closing occurs. 205.5 Termination. If Escrow is not in condition to close by the Outside Date, then either party that has fully performed under this Agreement may, in writing, demand the return of money or property and terminate the Escrow. If either party makes a written demand for return of documents or properties, the Escrow shall not terminate until five (5) days after Escrow Holder shall have delivered copies of such demand to all other parties at the respective addresses shown in this Agreement. If any objections are raised within said five (5) day period, Escrow Holder is authorized to hold all papers and documents until instructed by a court of competent jurisdiction or by mutual written instructions of the parties. Termination of the Escrow shall be without prejudice as to whatever legal rights either party may have against the other arising from this Agreement. If no demands are made, Escrow Holder shall proceed with the Closing as soon as possible. 205.6 Closing Procedure. Escrow Holder shall close Escrow for the purchase of the Property as follows: (a) Record the Grant Deed and Operating Covenant with instructions for the Recorder of San Diego County, California to deliver the Grant Deed to Developer and Operating Covenant to the CDC. (b) Instruct the Title Company to deliver the Title Policy to Developer. (c) File any informational reports required by Internal Revenue Code Section 6045(e), as amended, and any other applicable requirements; and (d) Deliver the FIRPTA Certificate, if any, and Form 593-C (if applicable) to Developer; and (e) Forward to both Developer and CDC a separate accounting of all funds received and disbursed for each party and copies of all executed and recorded or filed documents deposited into Escrow, with such recording and filing date and information endorsed thereon. 206. Review of Title. CDC shall cause Escrow Holder ("Title Company") to deliver to Developer a standard preliminary consolidated title report ("Report") with respect to the title to the Property if Developer has not previously received a Report, together with legible copies of the documents ("Documents") underlying the exceptions ("Exceptions") set forth in the Report, within thirty (30) days from the date of this Agreement. Developer shall have the right to 10 017.262230.5 reasonably approve or disapprove the Exceptions in its sole and absolute discretion; provided, however, that Developer hereby approves the following Exceptions: (a) The Redevelopment Plan; (b) The Redevelopment Project; and (c) The lien of any non -delinquent property taxes and assessments (to be prorated at Close of Escrow. Owner shall have thirty (30) days from the date of its latest receipt of the Report and the Documents to give written notice to CDC and Escrow Holder of Developer's approval or disapproval of any such Exceptions. If Developer timely disapproves any Exceptions, CDC shall have thirty (30) days from the receipt of Developer's written notice to either cause such exceptions to be removed from the Report or provide assurance to Developer such Exceptions will be removed at or before the Closing. If CDC does not either cause the disapproved Exceptions to be removed or provide assurances thereof, Developer may terminate this Agreement. If Developer pays to CDC the Purchase Price, Developer shall be deemed to have approved the Exceptions for the Property. The Permitted Exceptions plus the Exceptions approved by Developer as provided herein shall be referred to as the "Condition of Title." CDC shall not voluntarily create any new exceptions to title following CDC's acquisition of the Property. Title to the fee shall be delivered to Developer free of all mortgages, deeds or trust, judgments and mechanics liens, not suffered or incurred by Developer. 207. Title Insurance. Concurrently with recordation of the Grant Deed from CDC to Developer conveying title to the Property, there shall be issued to Developer at Developer's election either a CLTA Owners Policy or an ALTA Extended Coverage Owner's policy of title insurance ("Title Policy"), together with such endorsements as are reasonably requested by Developer, issued by the Title Company insuring that the title to the Property is vested in Developer in the condition required by Section 206 of this Agreement. The Title Company shall provide CDC with a copy of the Title Policy. The Title Policy shall be for the amount of the Purchase Price. 208. Conditions of Closing. The Closing is conditioned upon the satisfaction of the following terms and conditions within the times designated below: 208.1 CDC's Conditions of Closing. CDC's obligation to proceed with the Closing of the sale of the Site is subject to the fulfillment or waiver by CDC of each and all of the conditions precedent (a) through (f), inclusive, described below ("CDC's Conditions Precedent"), which are solely for the benefit of CDC, and which shall be fulfilled or waived by the time periods provided for herein: (a) No Default. Prior to the Close of Escrow, Developer shall not be in default in any of its obligations under the terms of this Agreement and all representations and warranties of Developer contained herein shall be true and correct in all material respects. 017.262230.5 11 (b) Execution of Documents. The Developer shall have executed any documents required hereunder and delivered such documents into Escrow, including the Operating Covenant. (c) Payment of Funds. Prior to the Close of Escrow, Developer shall have paid the Purchase Price and all required costs of Closing into Escrow in accordance with Section 205.1 hereof. (d) Design Approvals. The Developer shall have obtained approval by the City of the Basic Concept Drawings. (e) Insurance. The Developer shall have provided proof of insurance as required by Section 306 hereof. (f) Financing. The CDC shall have approved acquisition financing as provided in Section 310 hereof, and such financing shall have closed and funded or be ready to close and fund upon the Closing. 208.2 Developer's Conditions of Closing. Developer's obligation to proceed with the purchase of the Site is subject to the fulfillment or waiver by Developer of each and all of the conditions precedent (a) through (e), inclusive, described below ("Developer's Conditions Precedent"), which are solely for the benefit of Developer, and which shall be fulfilled or waived by the time periods provided for herein: (a) No Default. Prior to the Close of Escrow, CDC shall not be in default in any of its obligations under the terms of this Agreement and all representations and warranties of CDC contained herein shall be true and correct in all material respects. (b) Execution of Documents. The CDC shall have executed the Grant Deed and Operating Covenant and any other documents required hereunder, and delivered such documents into Escrow. (c) Review and Approval of Title. Developer shall have reviewed and approved the condition of title of the Site, as provided in Section 206 hereof. (d) Title Policy. The Title Company shall, upon payment of Title Company's regularly scheduled premium, have agreed to provide the Title Policy to Developer for the Site upon the Close of Escrow, in accordance with Section 207 hereof. Notwithstanding the foregoing, if CDC has not obtained title to the Property, but has obtained a judicial order authorizing the CDC to take possession thereof, at the Developer's option CDC shall convey and the Developer shall accept the Property if the following conditions are met: (i) The CDC delivers exclusive possession of the Property to the Developer by Grant Deed, on or prior to the time set for conveyance thereof; (ii) The right of possession which the Developer acquires from the CDC is such that Title Company will issue a policy or 12 017.262230.5 as follows: policies of title insurance acceptable to Developer's lender as to the interest conveyed by said Grant Deed subject to only those items described in Section 206; and (iii) The Developer is able to secure financing for the acquisition of the Property on the basis of said Title Policy. In connection with such title policy, CDC (if required by the Title Company) and Developer agree to provide Title Company with an indemnity agreement in a form reasonably requested by the Title Company. 209. Representations and Warranties. follows: 209.1 CDC Representations. CDC represents and warrants to Developer as (a) Authority. CDC is a public body, corporate and politic, existing pursuant to the California Community Redevelopment Law (California Health and Safety Code Section 33000), which has been authorized to transact business pursuant to action of the City. (b) FIRPTA. CDC is not a "foreign person" within the parameters of FIRPTA or any similar state statute, or is exempt from the provisions of FIRPTA or any similar state statute, or that CDC has complied and will comply with all the requirements under FIRPTA or any similar state statute. (c) No Conflict. To the best of CDC's knowledge, CDC's execution, delivery and performance of its obligations under this Agreement will not constitute a default or a breach under any contract, agreement or order to which CDC is a party or by which it is bound. 209.2 Developer Representations. Developer represents and warrants to CDC (a) Authority. Developer is a corporation formed in and in good standing under the laws of the State of California, and is qualified to do business within the State of California. Developer has full right, power and lawful authority to purchase and accept the conveyance of the Site and undertake all obligations as provided herein and the execution, performance and delivery of this Agreement by Developer has been fully authorized by all requisite actions on the part of the Developer and any necessary third parties. (b) No Conflict. To the best of Developer's knowledge, Developer's execution, delivery and performance of its obligations under this Agreement will not constitute a default or a breach under any contract, agreement or order to which the Developer is a party or by which it is bound. proceeding. (c) No Bankruptcy. Developer is not the subject of a bankruptcy 017.262230.5 13 210. "As Is" Sale. DEVELOPER ACKNOWLEDGES THAT, SUBJECT TO THE EXPRESS REPRESENTATIONS, WARRANTIES AND COVENANTS OF CDC UNDER THIS AGREEMENT, DEVELOPER IS PURCHASING THE SITE "AS IS" IN RELIANCE SOLELY ON: (A) DEVELOPER'S OWN INSPECTIONS OF THE SITE; (B) DEVELOPER'S INDEPENDENT VERIFICATION OF THE TRUTH OF ANY DOCUMENTS MADE AVAILABLE TO DEVELOPER; AND (C) THE OPINIONS AND ADVICE CONCERNING THE SITE OF CONSULTANTS ENGAGED BY DEVELOPER. DEVELOPER ACKNOWLEDGES AND AGREES THAT, EXCEPT FOR THE REPRESENTATIONS, WARRANTIES AND COVENANTS OF CDC EXPRESSLY SET FORTH IN THIS AGREEMENT, CDC IS NOT MAKING ANY OTHER WARRANTIES OR REPRESENTATIONS EXPRESS OR IMPLIED OF ANY KIND OR CHARACTER WITH RESPECT TO THE SITE, INCLUDING WITHOUT LIMITATION: (i) THE QUALITY, NATURE, ADEQUACY AND PHYSICAL CONDITION OF THE SITE, (ii) THE QUALITY, NATURE, ADEQUACY, AND PHYSICAL CONDITION OF SOILS, GEOLOGY AND ANY GROUNDWATER RELATING TO THE SITE, (iii) THE EXISTENCE, QUALITY, NATURE, ADEQUACY AND PHYSICAL CONDITION OF UTILITIES SERVING THE SITE, (iv) THE SITE'S USE, HABITABILITY, MERCHANTABILITY, OR FITNESS, SUITABILITY, VALUE OR ADEQUACY OF THE SITE FOR ANY PARTICULAR PURPOSE, (v) THE COMPLIANCE OF THE SITE WITH ANY APPLICABLE CODES, LAWS, REGULATIONS, STATUTES, ORDINANCES, COVENANTS, CONDITIONS AND RESTRICTIONS OF ANY GOVERNMENTAL OR QUASI -GOVERNMENTAL ENTITY OR OF ANY OTHER PERSON OR ENTITY, (vi) THE PRESENCE OF ANY HAZARDOUS MATERIALS ON, UNDER OR ABOUT THE SITE OR THE ADJOINING OR NEIGHBORING SITE, (vii) THE CONDITION OF TITLE TO THE SITE, AND (viii) THE ECONOMICS OF THE OPERATION OF THE SITE AS AN AUTOMOBILE SALES, SERVICE AND REPAIR FACILITY OR ANY OTHER USE. DEVELOPER WARRANTS AND REPRESENTS THAT IT HAS NOT RELIED AND WILL NOT RELY ON, EITHER DIRECTLY OR INDIRECTLY, ANY WARRANTY OR REPRESENTATION OF CDC OR ITS AGENTS NOT EXPLICITLY SET FORTH IN THIS AGREEMENT. 300. DEVELOPMENT OF THE SITE 301. Scope of Development. 301.1 Developer's Obligation to Construct Improvements. The Developer shall develop or cause the development of the Improvements in accordance with the Scope of Development, the City Municipal Code, and the plans, drawings and documents submitted by the Developer and approved by the CDC and City as set forth herein. 302. Design Review. 302.1 Basic Concept Drawings. The Developer has submitted conceptual drawings for the Improvements (collectively, the "Basic Concept Drawings") which the CDC has approved. 302.2 Site Plan Drawings. Within the time set forth in the Schedule of Performance, the Developer and CDC shall submit to the City plans and drawings with respect to 14 017.262230.5 the Improvements (the "Site Plan Drawings"), which must include all documents, plans and drawings (the "Construction Drawings"), including any application materials required by the City Planning Services Division, which are necessary to obtain all City approvals for the construction of the Improvements. 302.3 Consultation and Coordination. During the preparation of additional Site Plan Drawings, if any, and Construction Drawings, and other documents by Developer, staff of the CDC and the Developer shall hold regular progress meetings to coordinate the preparation of, submission to, and review of the Site Plan Drawings and Construction Drawings. The staff of the CDC and the Developer shall communicate and consult as frequently as is necessary to ensure that the formal submittal of any documents to the CDC can receive prompt and thorough consideration. The CDC shall designate a CDC employee/consultant to serve as the project manager who is responsible for the coordination of the CDC's activities under this Agreement. Approval of progressively more detailed drawings and specifications will be promptly granted by the CDC or designee if developed as a logical evolution of drawings or specifications theretofore approved. Any items so submitted and approved by the CDC or designee shall not be subject to subsequent disapproval. Any disapproval shall state in writing the reasons for disapproval and the changes which the CDC or designee requests to be made. Such reasons and such changes must be consistent with the Scope of Development and any items previously approved hereunder. Approval of progressively more detailed drawings and specifications will be promptly granted by the CDC or designee if developed as a logical evolution of drawings or specifications theretofore approved. Any items so submitted and approved by the CDC or designee shall not be subject to subsequent disapproval. Any disapproval shall state in writing the reasons for disapproval and the changes which the CDC or designee requests to be made. Such reasons and such changes must be consistent with the Scope of Development and any items previously approved hereunder. 302.4 Revisions. If the Developer desires to propose any material revisions to the CDC -approved Basic Concept Drawings, Site Plan Drawings or Construction Drawings, it shall submit such proposed changes to the CDC, and shall also proceed in accordance with any and all State and local laws and regulations regarding such revisions, within the time frame set forth in the Schedule of Performance. The CDC's Director is authorized to approve changes to the CDC -approved Basic Concept Drawings, Site Plan Drawings and Construction Drawings provided such changes: 1) do not materially reduce the quality of materials to be used; and 2) do not reduce the imaginative and unique qualities of the project design. Any and all change orders or revisions required by the City and its inspectors which are required under the Municipal Code and all other applicable Uniform Codes (e.g. Building, Plumbing, Fire, Electrical, etc.) and under other applicable laws and regulations shall be included by the Developer in its Basic Concept Drawings, Site Plan Drawings and Construction Drawings and completed during the construction of the Improvements. 302.5 Defects in Plans. The CDC shall not be responsible either to the Developer or to third parties in any way for any defects in the Basic Concept Drawings, the Site Plan Drawings or the Construction Drawings, or other documents prepared by or for the Developer, nor for any structural or other defects in any work done according to the approved Basic Concept Drawings, Site Plan Drawings or Construction Drawings or other documents 15 017.262230.5 prepared by or for the Developer, nor for any delays reasonably caused by the review and approval processes established by this Section 302. 303. Land Use Approvals. Before commencement of construction of the Improvements or other works of improvement upon the Site, the Developer shall, at its own expense, secure or cause to be secured any and all land use and other entitlements, permits and approvals which may be required for the Improvements by the City or any other governmental agency affected by such construction or work. The Developer shall, without limitation, apply for and secure the following, and pay all costs, charges and fees associated therewith: (a) City Site Plan Approval. (b) All other permits and fees required by the City, County of San Diego, and other governmental agencies with jurisdiction over the Improvements. (c) Any environmental studies and documents required pursuant to the California Environmental Quality Act, if any. The execution of this Agreement does not, however, constitute the granting of or a commitment to obtain any required land use permits, entitlements or approvals required by the CDC or the City. 304. Schedule of Performance. Each party to this Agreement shall perform the obligations to be performed by such party pursuant to this Agreement within the respective times provided in the Schedule of Performance, and if no such time is provided, within a reasonable time. The Schedule of Performance shall be subject to amendment from time to time upon the mutual agreement of the CDC and Developer. 305. Cost of Construction. All of the cost of planning, designing, developing, site preparation and constructing all of the Improvements shall be borne solely by the Developer. 306. Insurance Requirements. The Developer shall take out and maintain or shall cause its general contractor to take out and maintain until the issuance of the Release of Construction Covenants pursuant to Section 309 of this Agreement, a comprehensive general liability policy in the minimum amount of Three Million Dollars (S3,000,000.00) combined single limit policy, or such other policy limits as the CDC may approve at its discretion, including contractual liability, as shall protect the Developer, City and CDC from claims for such damages, and which policy shall be issued by a "B+" or higher rated insurance carrier. Such policy or policies shall be written on an occurrence form. The Developer shall also furnish or cause to be furnished to the CDC evidence satisfactory to the CDC that any contractor with whom it has contracted for the performance of work on the Site or otherwise pursuant to this Agreement carries workers' compensation insurance as required by law. The Developer shall furnish a certificate of insurance countersigned by an authorized agent of the insurance carrier on a form approved by the CDC setting forth the general provisions of the insurance coverage. This countersigned certificate shall name the City and the CDC and their respective officers, agents, and employees as additionally insured parties under the policy, and the certificate shall be accompanied by a duly executed endorsement evidencing such additional insured status. The certificate and endorsement by the insurance carrier shall contain a statement of obligation on the 16 017.262230.5 part of the carrier to notify City and the CDC of any material change, cancellation or termination of the coverage at least thirty (30) days in advance of the effective date of any such material change, cancellation or termination. Coverage provided hereunder by the Developer shall be primary insurance and not be contributing with any insurance maintained by the CDC or City, and the policy shall contain such an endorsement. The insurance policy or the endorsement shall contain a waiver of subrogation for the benefit of the City and the CDC. The Developer shall furnish the required certificate prior to the Closing as a CDC Condition Precedent to the Closing. 307. Rights of Access. Prior to the issuance of a Release of Construction Covenants (as specified in Section 309 of this Agreement), for purposes of assuring compliance with this Agreement, representatives of the CDC shall have the right of reasonable access to the Site, without charges or fees, at normal construction hours during the period of construction for the purposes of this Agreement, including but not limited to, the inspection of the work being performed in constructing the Improvements so long as CDC representatives comply with all safety rules. The CDC (or its representatives) shall, except in emergency situations, notify the Developer at least forty-eight (48) hours prior to exercising its rights pursuant to this Section 307. 308. Compliance with Laws. The Developer shall carry out the design, construction and operation of the Improvements in conformity with all applicable laws, including all applicable state labor standards, the City zoning and development standards, building, plumbing, mechanical and electrical codes, and all other provisions of the City Municipal Code, and all applicable disabled and handicapped access requirements, including without limitation the Americans With Disabilities Act, 42 U.S.C. Section 12101, et seq., Government Code Section 4450, et seq., Government Code Section 11135, et seq., and the Unruh Civil Rights Act, Civil Code Section 51, et seq. 308.1 Nondiscrimination in Employment. Developer agrees that all persons employed or applying for employment by it, its affiliates, subsidiaries, or holding companies, and all subcontractors, bidders and vendors, are and will be treated equally by it without regard to, or because of race, color, religion, ancestry, national origin, sex, age, pregnancy, childbirth or related medical condition, medical condition (cancer related) or physical or mental disability, and in compliance with Title VII of the Civil Rights Act of 1964, 42 U.S.C. Section 2000, et seq., the Federal Equal Pay Act of 1963, 29 U.S.C. Section 206(d), the Age Discrimination in Employment Act of 1967, 29 U.S.C. Section 621, et seq., the Immigration Reform and Control Act of 1986, 8 U.S.C. Section 1324b, et seq., 42 U.S.C. Section 1981, the California Fair Employment and Housing Act, Cal. Government Code Section 12900, et seq., the California Equal Pay Law, Cal. Labor Code Section 1197.5, Cal. Government Code Section 11135, the Americans with Disabilities Act, 42 U.S.C. Section 12101, et seq., and all other anti- discrimination laws and regulations of the United States and the State of California as they now exist or may hereafter be amended. 308.2 Prevailing Wages. All work pursuant to this Agreement shall be done in accordance with all applicable federal and state labor standards. Developer is aware of Sections 33423 — 33426 of the California Health and Safety Code and Sections 1770 — 1780 of the California Labor Code and is aware of the requirements of California Labor Code Sections 1720 et. seq. and 1770 et seq. as well as California Code of Regulations, Title 8, §16000 et. seq. 17 017.262230.5 ("Prevailing Wage Laws"), which require the payment of prevailing wage rates and the performance of other requirements on certain "public works" and "maintenance" projects. In light of the fact that the Site is being purchased by Developer for its fair market value without public subsidy, it is the belief and understanding of the CDC and Developer that this Agreement does not involve a "public work" or "maintenance" project, as defined by the Prevailing Wage Laws. Notwithstanding the foregoing, Developer hereby expressly acknowledges and agrees that neither the City nor CDC has represented to Developer that the Project will not be a "public work" and in the event a determination should ever be made that this Agreement does involve a "public work" or "maintenance project" or is otherwise subject to Prevailing Wage Laws, Developer agrees to fully comply with such Prevailing Wage Laws. Developer shall defend, indemnify and hold the CDC, its elected officials, officers, employees and agents free and harmless from any and all claims, liabilities, costs, penalties or interest arising out of any failure or alleged failure to comply with the Prevailing Wage Laws in connection with this Agreement. If the CDC or any of the indemnified parties are named as a party in any dispute described in this Section 308.2, Developer agrees that the CDC and the other indemnified parties may appoint their own independent counsel who are reasonably acceptable to Developer, and Developer agrees to pay all reasonable attorneys' fees and defense costs of the CDC and the other indemnified parties, in addition to all other damages, fines, penalties and losses incurred by the CDC and the other indemnified parties as a result of the action. 308.3 Taxes and Assessments. Upon and after the Closing, at all times during which the Developer owns the Site, the Developer shall pay prior to delinquency all ad valorem real estate taxes and assessments on the Site, subject to the Developer's right to contest in good faith any such taxes. 308.4 Lien and Stop Notices. Developer shall not allow to be placed on the Site or any part thereof any lien or stop notice. If a claim of a lien or stop notice is given or recorded affecting the Improvements, Developer shall, within sixty (60) days of such recording or service or, within five (5) days of CDC's demand thereafter, whichever last occurs: (a) Pay and discharge the same; or (b) Effect the release thereof by recording and delivering to CDC a surety bond in sufficient form and amount, or otherwise; or (c) Provide CDC with other assurances, which CDC deems, in its sole discretion, to be satisfactory for the payment of such lien or bonded stop notice and for the full and continuous protection of CDC from the effect of such lien or bonded stop notice. 309. Release of Construction Covenants. Promptly after completion of the Improvements in conformity with this Agreement, the CDC shall furnish the Developer with a "Release of Construction Covenants," in the form of Attachment No. 6 hereto which is incorporated herein by reference. The CDC shall not unreasonably withhold such Release of Construction Covenants. The Release of Construction Covenants shall be a conclusive determination of satisfactory completion of the Improvements and the Release of Construction Covenants shall so state. Any party then owning or thereafter purchasing, leasing or otherwise acquiring any interest in the Site shall not (because of such ownership, purchase, lease or 18 017.262230.5 acquisition) incur any obligation or liability under this Agreement except for those continuing covenants as described in the Grant Deed. If the CDC refuses or fails to furnish the Release of Construction Covenants, after written request from the Developer, the CDC shall, within ten (10) days of written request thereof, provide the Developer with a written statement of the reasons the CDC refused or failed to furnish the Release of Construction Covenants. The statement shall also contain the CDC's opinion of the actions the Developer must take to obtain the Release of Construction Covenants. The Release of Construction Covenants shall not constitute evidence of compliance with or satisfaction of any obligation of the Developer to any holder of any mortgage, or any insurer of a mortgage securing money loaned to finance the Improvements, or any part thereof. The Release of Construction Covenants is not a notice of completion as referred to in Section 3093 of the California Civil Code. 310. Financing of the Improvements. 310.1 Approval of Financing. Developer shall submit to CDC reasonable assurances that Developer has sufficient funds on hand or has obtained sufficient commitments for construction financing necessary to undertake the development of the Site and the construction of the Improvements in accordance with this Agreement. The CDC shall approve or disapprove such evidence of financing commitments within fifteen (15) days of receipt of a complete submission. Approval shall not be unreasonably withheld or conditioned. if the CDC disapproves of the evidence of financing, CDC shall do so by Notice to Developer stating the reasons for such disapproval and Developer shall promptly obtain and submit to CDC new evidence of financing. CDC shall approve or disapprove such new evidence of financing in the same manner and within the same times established in this Section 310.1 for the approval or disapproval of the evidence of financing as initially submitted to CDC. CDC agrees to make reasonable modifications of Sections 310 and 503 that may be requested by Developer's lender, provided such modifications do not adversely affect the receipt of any material benefit by CDC hereunder. Upon the reasonable request of a Developer's lender, CDC shall execute from time - to -time estoppel certificates to the extent they are consistent with the terms of this Agreement. CDC shall respond to any request under this paragraph within fifteen (15) days after receipt of the request accompanied by sufficient information as may be reasonably required in order for the CDC to act on such request. 310.2 No Encumbrances Except Mortgages and Deeds of Trust. Mortgages and deeds of trust shall be permitted for the purpose of securing loans of funds to be used for financing the construction of the Improvements (including architecture, engineering, legal, and related direct costs as well as indirect costs) on or in connection with the Site, permanent financing, and any other purposes necessary and appropriate in connection with development under this Agreement. The Developer shall notify the CDC in advance of any mortgage or deed of trust financing, if the Developer proposes to enter into the same before completion of the construction of the Improvements. 310.3 Holder Not Obligated to Construct Improvements. The holder of any mortgage or deed of trust authorized by this Agreement shall not be obligated by the provisions of this Agreement to construct or complete the Improvements or any portion thereof, or to 19 017.262230.5 guarantee such construction or completion; nor shall any covenant or any other provision in this Agreement be construed so to obligate such holder. Nothing in this Agreement shall be deemed to construe, permit or authorize any such holder to devote the Site to any uses or to construct any improvements thereon, other than those uses or improvements provided for or authorized by this Agreement. 310.4 Notice of Default to Mortgagee or Deed of Trust Holders; Right to Cure. With respect to any mortgage or deed of trust granted by Developer as provided herein, whenever the CDC may deliver any notice or demand to Developer with respect to any breach or default by the Developer in completion of construction of the Improvements, the CDC shall at the same time deliver to each holder of record of any mortgage or deed of trust authorized by this Agreement a copy of such notice or demand. Each such holder shall (insofar as the rights granted by the CDC are concerned) have the right, at its option, within one hundred twenty (120) days after the receipt of the notice, to cure or remedy or commence to cure or remedy and thereafter to pursue with due diligence the cure or remedy of any such default and to add the cost thereof to the mortgage debt and the lien of its mortgage. Nothing contained in this Agreement shall be deemed to permit or authorize such holder to undertake or continue the construction or completion of the Improvements, or any portion thereof (beyond the extent necessary to conserve or protect the improvements or construction already made) without first having expressly assumed the Developer's obligations to the CDC by written agreement reasonably satisfactory to the CDC. The holder, in that event, must agree to complete, in the manner provided in this Agreement, the Improvements to which the lien or title of such holder relates. Any such holder properly completing such Improvements shall be entitled, upon compliance with the requirements of Section 310 of this Agreement, to a Release of Construction Covenants. It is understood that a holder shall be deemed to have satisfied the one hundred twenty (120) day time limit set forth above for commencing to cure or remedy a Developer default which requires title and/or possession of the Site (or portion thereof) if and to the extent any such holder has within such one hundred twenty (120) day period commenced proceedings to obtain title and/or possession and thereafter the holder diligently pursues such proceedings to completion and cures or remedies the default. 310.5 Failure of Holder to Complete Improvements. In any case where, if within one hundred twenty (120) days after the holder of any mortgage or deed of trust creating a lien or encumbrance upon the Site or any part thereof receives a notice from the CDC of a default by the Developer in completion of construction of any of the Improvements under this Agreement, and such holder has not exercised the option to construct as set forth in Section 310.4, or if it has exercised the option but has defaulted hereunder and failed to timely cure such default, the CDC may purchase the mortgage or deed of trust by payment to the holder of the amount of the unpaid mortgage or deed of trust. If the ownership of the Site or any part thereof has vested in the holder, the CDC, if it so desires, shall be entitled to a conveyance from the holder to the CDC upon payment to the holder of an amount equal to the sum of the following: (a) The unpaid mortgage or deed of trust at the time title became vested in the holder (less all appropriate credits, including those resulting from collection and application of rentals and other income received during foreclosure proceedings); 20 017.262230.5 attorneys' fees; (b) All expenses with respect to foreclosure, including reasonable (c) The net expense, if any (exclusive of general overhead) incurred by the holder as a direct result of the subsequent ownership or management of the Site or part thereof, such as insurance costs and taxes; (d) The costs of any Improvements made by such holder; (e) An amount equivalent to the interest that would have accrued on the aggregate of such amounts had all such amounts become part of the mortgage or deed of trust debt and such debt had continued in existence to the date of payment by CDC; and, (f) Any customary prepayment charges imposed by the lender pursuant to its loan documents and agreed to by Developer. 310.6 Right of the CDC to Cure Mortgage or Deed of Trust. In the event of a mortgage or deed of trust default or breach by Developer prior to the completion of the construction of any of the Improvements or any part thereof, Developer shall immediately deliver to CDC a copy of any mortgage holder's notice of default. If the holder of any mortgage or deed of trust has not exercised its option to construct, or Developer has not cured or commenced a cure of such default, CDC shall have the right but not the obligation to cure the default. In such event, CDC shall be entitled to reimbursement from Developer of all proper costs and expenses incurred by CDC in curing such default. CDC shall also be entitled to a lien upon the Site to the extent of such costs and disbursements. Any such lien shall be junior and subordinate to the mortgages or deeds of trust pursuant to Section 310. 400. COVENANTS AND RESTRICTIONS 401. Use in Accordance with Redevelopment Plan. The Developer covenants and agrees for itself, its successors, assigns, and every successor in interest to the Site or any part thereof, that upon the Closing and during construction and thereafter, the Developer shall devote the Site to the uses specified in this Agreement for the periods of time specified therein. All uses conducted on the Site, including, without limitation, all activities undertaken by the Developer pursuant to this Agreement, shall conform to this Agreement and all applicable provisions of the City Municipal Code. The foregoing covenants shall run with the land. 402. Use Covenants. For a term commencing upon the Conveyance and ending upon the expiration of the Operating Covenant, the Developer hereby covenants and agrees for itself, its successors, and assigns and all voluntary and involuntary successors in interest to the Site, or any part thereof, that the Site will only be used in compliance with the Operating Covenant. 403. Maintenance Covenants. The Developer shall maintain the Site and all Improvements thereon, including all landscaping and erosion control, in a commercially reasonable manner. 017.262230.5 21 404. Nondiscrimination Covenants. The Developer covenants for itself and any successors in interest that there shall be no discrimination against or segregation of any person or group of persons on account of race, color, creed, religion, sex, marital status, national origin or ancestry in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the Site, nor shall the Developer or any person claiming under or through it establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees or vendees of the Site. The foregoing covenants shall run with the land. The Developer shall refrain from restricting the rental, sale or lease of the Site on the basis of race, color, religion, sex, marital status, ancestry or national origin of any person. MI such deeds, leases or contracts shall contain or be subject to substantially the following nondiscrimination or non -segregation clauses: (a) In deeds: "The grantee herein covenants by and for himself or herself, his or her heirs, executors, administrators and assigns, and all persons claiming under or through them, that there shall be no discrimination against or segregation of, any person or group of persons on account of race, color, creed, religion, sex, marital status, national origin or ancestry in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the land herein conveyed, nor shall the grantee or any person claiming under or through him or her, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees or vendees in the land herein conveyed. The foregoing covenants shall run with the land." (b) In leases: "The lessee herein covenants by and for himself or herself, his or her heirs, executors, administrators, and assigns, and all persons claiming under or through him or her, and this lease is made and accepted upon and subject to the following conditions: "That there shall be no discrimination against or segregation of any person or group of persons, on account of race, color, creed, religion, sex, marital status, national origin, or ancestry in the leasing, subleasing, transferring, use, occupancy, tenure, or enjoyment of the premises herein leased nor shall the lessee himself or herself, or any person claiming under or through him or her, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use, or occupancy of tenants, lessees, sublessees, subtenants, or vendees in the premises herein leased." (c) In contracts: "There shall be no discrimination against or segregation of, any person, or group of persons on account of race, color, creed, religion, sex, marital status, national origin, or ancestry, in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the premises, nor shall the transferee himself or herself or any person claiming under or through him or her, establish or permit any such practice or practices of 22 017.262230.5 discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees or vendees of the premises." 405. Effect of Violation of the Terms and Provisions of this Agreement After Completion of Construction. The CDC is deemed the beneficiary of the terms and provisions of this Agreement and of the covenants running with the land, for and in its own right and for the purposes of protecting the interests of the community and other parties, public or private, in whose favor and for whose benefit this Agreement and the covenants running with the land have been provided, without regard to whether the CDC has been, remains or is an owner of any land or interest therein in the Site or in the Redevelopment Project. The CDC shall have the right, if the Agreement or covenants are breached, to exercise all rights and remedies, and to maintain any actions or suits at law or in equity or other proper proceedings to enforce the curing of such breaches and to avail itself of the rights granted herein to which it or any other beneficiaries of this Agreement and covenants may be entitled. The covenants contained in this Agreement shall remain in effect for the periods described herein, specifically including, without limitation, the following: (a) The covenants pertaining to use of the Site that are set forth in Section 401 and 402 of this Agreement shall remain in effect for the term of the Redevelopment Plan. (b) The covenants against discrimination, as set forth in Section 404 of this Agreement, shall remain in effect in perpetuity. 406. Indemnification. Developer hereby agrees to indemnify, defend and hold harmless the CDC, its elected officials, officers, employees and agents (the "Indemnified Parties") from and against any and all claims, losses, liabilities, costs, expenses (including reasonable attorneys' fees), actions, causes of action, penalties or interest arising out of or in connection with any third party challenges or objections to actions taken by any of the Indemnified Parties pursuant to this Agreement. 500. DEFAULTS AND REMEDIES 501. Default Remedies. Subject to the extensions of time set forth in Section 602 of this Agreement, failure by either Party to perform any action or covenant required by this Agreement within the time periods provided herein following notice and failure to cure as described hereafter, constitutes a "Default" under this Agreement. A Party claiming a Default shall give written notice of Default to the other Party specifying the Default complained of. Except for the obligations set forth in Sections 202 and 203, for which time is of the essence, or as otherwise expressly provided in this Agreement, the claimant shall not institute any proceeding against any other Party, and the other Party shall not be in Default if such Party within thirty (30) days from receipt of such notice immediately, with due diligence, commences to cure, correct or remedy such failure or delay and shall complete such cure, correction or remedy with diligence. 502. Institution of Legal Actions. In addition to any other rights or remedies and subject to the restrictions otherwise set forth in this Agreement, either Party may institute an 017.262230.5 23 action at law or equity to seek specific performance of the terms of this Agreement, or to cure, correct or remedy any Default, to recover damages for any Default, or to obtain any other remedy available at law or in equity. Such legal actions must be instituted in the Superior Court of the County of San Diego, State of California, or in the District of the United States District Court in which such county is located. 503. Reentry and Revesting of Title in the CDC After the Closing and Prior to Completion of Construction. Subject to the notice and cure provisions of this Agreement and the rights of a holder of any mortgage or deed of trust encumbering the Site, the CDC has the right, at its election, to reenter and take possession of the Site, with all Improvements thereon, and terminate and revest in the CDC the estate conveyed to the Developer if after the Closing and prior to the issuance of the Release of Construction Covenants, the Developer (or its successors in interest) shall: (a) Unless due to an Enforced Delay as described in Section 602 hereof, fail to start the construction of the Improvements as required by this Agreement for a period of one hundred twenty (120) days after written notice thereof from the CDC; or (b) Abandon or substantially suspend construction of the Improvements required by this Agreement for a period of one hundred twenty (120) days after written notice thereof from the CDC; or (c) Contrary to the provisions of Section 603 Transfer or suffer any involuntary Transfer in violation of this Agreement, and such transfer has not been approved by the CDC or rescinded within sixty (60) days of notice thereof from CDC to Developer. Such right to reenter, terminate and revest shall be subject to and be limited by and shall not defeat, render invalid or limit: (a) Any mortgage or deed of trust permitted by this Agreement; (b) Any rights or interests provided in this Agreement for the protection of the holders of such mortgages or deeds of trust; or (c) Any rights or interests held by a lessee in and to the Property. The Grant Deed shall contain appropriate reference and provision to give effect to the CDC's right as set forth in this Section 503, under specified circumstances prior to recordation of the Release of Construction Covenants, to reenter and take possession of the Site, with all improvements thereon, and to terminate and revest in the CDC the estate conveyed to the Developer. Upon the revesting in the CDC of title to the Site as provided in this Section 503, the CDC shall, pursuant to its responsibilities under State law, use its reasonable efforts to resell the Site as soon and in such manner as the CDC shall find feasible and consistent with the objectives of such law and of the Redevelopment Plan, as it exists or may be amended, to a qualified and responsible party or parties (as determined by the CDC) who will assume the obligation of making or completing the Improvements, or such improvements in their stead as shall be satisfactory to the CDC and in accordance with the uses specified for such Site or part thereof in the Redevelopment Plan. Upon such resale of the Site, the net proceeds thereof after repayment 24 017.262230.5 in full of any loan evidenced by a mortgage or deed of trust encumbering the Site which is permitted by this Agreement, shall be applied: (i) First, to reimburse the CDC, on its own behalf or on behalf of the City, all costs and expenses incurred by the CDC, excluding City and CDC staff costs, but specifically, including, but not limited to, any expenditures by the CDC or the City in connection with the recapture, management and resale of the Site or part thereof (but less any income derived by the CDC from the Site or part thereof in connection with such management); all taxes, assessments and water or sewer charges with respect to the Site or part thereof which the Developer has not paid (or, in the event that Site is exempt from taxation or assessment of such charges during the period of ownership thereof by the CDC, an amount, if paid, equal to such taxes, assessments, or charges as would have been payable if the Site were not so exempt); any payments made or necessary to be made to discharge any encumbrances or liens existing on the Site or part thereof at the time or revesting of title thereto in the CDC, or to discharge or prevent from attaching or being made any subsequent encumbrances or liens due to obligations, defaults or acts of the Developer, its successors or transferees; any expenditures made or obligations incurred with respect to the making or completion of the Improvements or any part thereof on the Site, or part thereof; and any amounts otherwise owing the CDC, and in the event additional proceeds are thereafter available, then (ii) Second, to reimburse the Developer, its successor or transferee, up to the amount equal to the sum of the costs incurred for the acquisition and development of the Site and for the improvements existing on the Site at the time of the reentry and possession. Any balance remaining after such reimbursements shall be retained by the CDC as its property. The rights established in this Section 503 are not intended to be exclusive of any other right, power or remedy, but each and every such right, power, and remedy shall be cumulative and concurrent and shall be in addition to any other right, power and remedy authorized herein or now or hereafter existing at law or in equity. These rights are to be interpreted in Light of the fact that the CDC will have conveyed the Site to the Developer for redevelopment purposes and not for speculation in undeveloped land. 504. Acceptance of Service of Process. In the event that the Developer commences legal action against the CDC, service of process on the CDC shall be made by personal service upon the Director of the CDC or in such other manner as may be provided by law. In the event that the CDC commences legal action against the Developer, service of process on the Developer 25 017.262230.5 shall be made by personal service on the Developer, whether made within or outside the State of California, or in such other manner as may be provided by law. 505. Rights and Remedies Are Cumulative. Except as otherwise expressly stated in this Agreement, the rights and remedies of the parties are cumulative, and the exercise by either party of one or more of such rights or remedies shall not preclude the exercise by it, at the same or different times, of any other rights or remedies for the same default or any other default by the other party. 506. Inaction Not a Waiver of Default. Any failures or delays by either 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 such rights or remedies, or deprive either such party of its right to institute and maintain any actions or proceedings which it may deem necessary to protect, assert or enforce any such rights or remedies. 507. Applicable Law. The laws of the State of California shall govern the interpretation and enforcement of this Agreement. 508. Non -Liability of Officials and Employees of the CDC. No member, official or employee of the CDC or the City shall be personally liable to the Developer, or any successor in interest, in the event of any Default or breach by the CDC (or the City) or for any amount which may become due to the Developer or its successors, or on any obligations under the terms of this Agreement. 509. Attorneys' Fees. In any action between the parties to interpret, enforce, reform, modify, rescind, or otherwise in connection with any of the terms or provisions of this Agreement, the prevailing party in the action shall be entitled, in addition to damages, injunctive relief, or any other relief to which it might be entitled, reasonable costs and expenses including, without limitation, litigation costs and reasonable attorneys' fees. 600. GENERAL PROVISIONS 601. Notices, Demands and Communications Between the Parties. Any approval, disapproval, demand, document or other notice ("Notice") which either party may desire to give to the other party under this Agreement must be in writing and may be given by any commercially acceptable means to the party to whom the Notice is directed at the address of the party as set forth below, or at any other address as that party may later designate by Notice. To CDC: COMMUNITY DEVELOPMENT COMMISSION OF THE CITY OF NATIONAL CITY 140 E. 12th Street, Suite B National City, CA 91950-3312 Attention: Executive Director 26 017.262230.5 Copy to: Richard L. Moskitis, Esq. FOLEY & LARDNER LLP 401 West Broadway, 23rd Floor San Diego, CA 92101-3542 To Developer: MOSSY NISSAN, INC. 9755 Clairemont Mesa Blvd. San Diego, CA 92124 Attention: Philip E. Mossy Telephone: (858) 654-2850 Facsimile: (858) 614-0132 Copy to: Edward F. Whittler, Esq. PETERSON & PRICE, APC 530 B Street, Suite 1700 San Diego, CA 92101 Telephone: (619) 234-0361 Facsimile: (619) 234-4786 Copy to: Alex Zirpolo 617 Saxony Place, Suite 101 Encinitas, CA 92024 Any written notice, demand or communication shall be deemed received immediately if delivered by hand and shall be deemed received on the third day from the date it is postmarked if delivered by registered or certified mail. 602. Enforced Delay; Extension of Times of Performance. In addition to specific provisions of this Agreement, performance by either party hereunder shall not be deemed to be in Default, and all performance and other dates specified in this Agreement shall be extended, where delays or Defaults are due to causes beyond the reasonable control or without the fault of the Party claiming an extension of time to perform, which may include the following: war; acts of intemational and domestic terrorism, insurrection; strikes; lockouts; riots; floods; earthquakes; fires; casualties; acts of God; acts of the public enemy; epidemics; quarantine restrictions; freight embargoes; lack of transportation; governmental restrictions or priority; litigation; severe weather; inability to secure necessary labor, materials or tools; delays of any contractor, subcontractor or supplier; acts or omissions of the other Party; acts or failures to act of the City or any other public or governmental agency or entity (other than the acts or failures to act of the CDC which shall not excuse performance by the CDC) (an "Enforced Delay"). Notwithstanding anything to the contrary in this Agreement, an extension of time for any such cause shall be for the period of the Enforced Delay and shall commence to run from the time of the commencement of the cause, if notice by the Party claiming such extension is sent to the other Party within thirty (30) days of the commencement of the cause. Times of performance under this Agreement may also be extended in writing by the mutual agreement of CDC and Developer. Notwithstanding any provision of this Agreement to the contrary, the lack of funding to complete the Improvements shall not constitute grounds of Enforced Delay pursuant to this Section 602. 017.262230.5 27 603. Transfers of Interest in Site or Agreement. The qualifications and identity of the Developer as the developer of high quality Project are of particular concern to the CDC. Furthermore, the Parties acknowledge that the CDC has negotiated the terms of this Agreement in contemplation of the development of the Improvements as described in the Scope of Development of this Agreement. Accordingly, for the period commencing upon the date of this Agreement and until the CDC's issuance of the Release of Construction Covenants as set forth in Section 309 hereof, (a) no voluntary or involuntary successor in interest of the Developer shall acquire any rights or powers under this Agreement, and (b) nor shall the Developer make any total or partial sale, transfer, conveyance, assignment, subdivision, of the whole or any part of the Site (a "Transfer")without the prior written approval of the CDC, except as expressly set forth herein. 603.1 Permitted Transfers. Notwithstanding any other provision of this Agreement to the contrary, CDC approval of a Transfer of the Site or a portion of the Site shall not be required in connection with any of the following: (a) Any Transfer to a limited liability company, partnership, corporation, or other entity or entities in which Developer or one of its members or shareholders retains a portion of the ownership or beneficial interest and retains management and control of the transferee entity or entities. (b) The conveyance or dedication of any portion of the Site to the City or other appropriate governmental agency, or the granting of easements or permits to facilitate construction of the Improvements. (c) Any requested assignment for financing purposes (subject to such financing being considered and approved by the CDC pursuant to Section 310.1 herein), including the grant of a deed of trust to secure the funds necessary for construction of the Improvements. (d) Any lease of commercial space within the Site to tenants in the ordinary course of business. In the event of a Transfer by Developer under subparagraph (a) above not requiring the CDC's prior approval, Developer nevertheless agrees that at Least fifteen (15) days before such Transfer it shall give written notice to CDC of such assignment and satisfactory evidence that the assignee has assumed in writing through an assignment and assumption agreement all of the obligations of this Agreement. Such assignment shall release the assigning Developer from any obligations to the CDC hereunder. 603.2 CDC Consideration of Requested Transfer. The CDC agrees that it will not unreasonably withhold approval of a request for approval of a Transfer made pursuant to this Section 603, provided the Developer delivers written notice to the CDC requesting such approval. Such notice shall be accompanied by evidence regarding the proposed transferee's development and/or operational qualifications and experience, and its financial commitments and resources, in sufficient detail to enable the CDC to evaluate the proposed assignee or purchaser pursuant to the criteria set forth in this Section 603 and as reasonably determined by the CDC. 28 017.262230.5 The CDC may, in considering any such request, take into consideration such factors as (i) the quality of any new and/or replacement operator, (ii) the transferee's past performance as an operator of new automobile dealerships, (iii) the current financial condition of the transferee, and similar factors. The CDC agrees not to unreasonably withhold its approval of any such requested Transfer, taking into consideration the foregoing factors. An assignment and assumption agreement in form satisfactory to the CDC's legal counsel shall also be required for all proposed Transfers. Within thirty (30) days after the receipt of the Developer's written notice requesting CDC approval of a Transfer pursuant to this Section 603, the CDC shall either approve or disapprove such proposed assignment or shall respond in writing by stating what further information, if any, the CDC reasonably requires in order to complete the request and determine whether or not to grant the requested approval. Upon receipt of such a response, the Developer shall promptly furnish to the CDC such further information as may be reasonably requested. 603.3 Successors and Assigns. Subject to the restrictions on Transfer set forth above in Section 603, all of the terms, covenants and conditions of this Agreement shall be binding upon the Developer and its permitted successors and assigns. Whenever the term "Developer" is used in this Agreement, such term shall include any other permitted successors and assigns as herein provided. 603.4 Assignment by CDC. The CDC may assign or transfer any of its rights or obligations under this Agreement without the approval of the Developer. 604. Relationship Between CDC and Developer. It is hereby acknowledged that the relationship between the CDC and the Developer is not that of a partnership or joint venture and that the CDC and the Developer shall not be deemed or construed for any purpose to be the agent of the other. Accordingly, except as expressly provided herein or in the Attachments hereto, the CDC shall have no rights, powers, duties or obligations with respect to the development, operation, maintenance or management of the Improvements. 605. CDC Approvals and Actions. The CDC shall maintain authority of this Agreement and the authority to implement this Agreement through the CDC Executive (or acting) Director (or his/her duly authorized representative). The CDC Executive (or acting) Director shall have the authority to make approvals, issue interpretations, waive provisions, and/or enter into certain amendments of this Agreement on behalf of the CDC so long as such actions do not materially or substantially change the uses or development permitted on the Site, or add to the costs incurred or to be incurred by the CDC as specified herein, and such approvals, interpretations, waivers and/or amendments may include extensions of time to perform as specified in the Schedule of Performance. All other material and/or substantive interpretations, waivers, or amendments shall require the consideration, action and written consent of the CDC Board. 606. Counterparts. This Agreement may be signed in multiple counterparts which, when signed by all parties, shall constitute a binding agreement. This Agreement is executed in three (3) originals, each of which is deemed to be an original. 017.262230.5 29 607. Integration. This Agreement contains the entire understanding between the Parties relating to the transaction contemplated by this Agreement, notwithstanding any previous negotiations or agreements between the Parties or their predecessors in interest with respect to all or any part of the subject matter hereof. All prior or contemporaneous agreements, understandings, representations and statements, oral or written, are merged in this Agreement and shall be of no further force or effect. Each Party is entering this Agreement based solely upon the representations set forth herein and upon each Party's own independent investigation of any and all facts such party deems material. This Agreement includes Attachment Nos. 1 through 7, which are incorporated herein. 608. Real Estate Brokerage Commission. Except for Developer's obligation to pay Mr. Alex Zirpolo a commission pursuant to a separate agreement between Developer and Mr. Zirpolo, the CDC and the Developer each represent and warrant to the other that no broker or finder is entitled to any commission or finder's fee in connection with the Developer's acquisition of the Site from the CDC. Each of the Parties agrees to defend and hold harmless the other Party from any claim to any such commission or fee from any other broker, agent or finder with respect to this Agreement which is payable by such Party. 609. Titles and Captions. Titles and captions are for convenience of reference only and do not define, describe or limit the scope or the intent of this Agreement or of any of its terms. Reference to section numbers is to sections in this Agreement, unless expressly stated otherwise. 610. Interpretation. As used in this Agreement, masculine, feminine or neuter gender and the singular or plural number shall each be deemed to include the others where and when the context so dictates. The word "including" shall be construed as if followed by the words "without limitation." This Agreement shall be interpreted as though prepared jointly by both Parties. 611. No Waiver. A waiver by either Party of a breach of any of the covenants, conditions or agreements under this Agreement to be performed by the other Party shall not be construed as a waiver of any succeeding breach of the same or other covenants, agreements, restrictions or conditions of this Agreement. 612. Modifications. Any alteration, change or modification of or to this Agreement, in order to become effective, shall be made in writing and in each instance signed on behalf of each Party. 613. Severability. If any term, provision, condition or covenant of this Agreement or its application to any Party or circumstances shall be held, to any extent, invalid or unenforceable, the remainder of this Agreement, or the application of the term, provision, condition or covenant to persons or circumstances other than those as to whom or which it is held invalid or unenforceable, shall not be affected, and shall be valid and enforceable to the fullest extent permitted by law. 614. Computation of Time. The time in which any act is to be done under this Agreement is computed by excluding the first day (such as the day escrow opens), and including 017.262230.5 2,1 30 the last day, unless the last day is a holiday or Saturday or Sunday, and then that day is also excluded. The term "holiday" shall mean all holidays as specified in Section 6700 and 6701 of the California Government Code. If any act is to be done by a particular time during a day, that time shall be Pacific Time Zone time. 615. Legal Advice. Each Party represents and warrants to the other the following: they have carefully read this Agreement, and in signing this Agreement, they do so with full knowledge of any right which they may have; they have received independent legal advice from their respective legal counsel as to the matters set forth in this Agreement, or have knowingly chosen not to consult legal counsel as to the matters set forth in this Agreement; and, they have freely signed this Agreement without any reliance upon any agreement, promise, statement or representation by or on behalf of the other Party, or their respective agents, employees, or attorneys, except as specifically set forth in this Agreement, and without duress or coercion, whether economic or otherwise. 616. Time of Essence. Time is expressly made of the essence with respect to the performance by the CDC, and the Developer of each and every obligation and condition of this Agreement. 617. Cooperation. Each party agrees to cooperate with the other in this transaction and, in that regard, to sign any and all documents which may be reasonably necessary, helpful, or appropriate to carry out the purposes and intent of this Agreement including, but not limited to, releases or additional agreements. 618. Conflicts of Interest. No member, official or employee of the CDC shall have any personal interest, direct or indirect, in this Agreement, nor shall any such member, official or employee participate in any decision relating to the Agreement which affects his/her personal interests or the interests of any corporation, partnership or association in which he/she is directly or indirectly interested. 619. Time for Acceptance of Agreement by CDC. This Agreement, when executed by the Developer and delivered to the CDC, must be authorized, executed and delivered by the CDC on or before forty-five (45) days after signing and delivery of this Agreement by the Developer or this Agreement shall be void, except to the extent that the Developer shall consent in writing to a further extension of time for the authorization, execution and delivery of this Agreement. 017.262230.5 31 IN WITNESS WHEREOF, the CDC and the Developer have executed this Disposition and Development Agreement as of the date set forth above. ATTEST: , CDC Secretary APPROVED AS TO FORM: CDC Counsel CDC: COMMUNITY DEVELOPMENT COMMISSION OF THE OF THE CITY OF NATIONAL CITY, a public body, corporate and politic By: Nick Inzunza, Chairman DEVELOPER: MOSSY NISSAN, INC., a California corporation By: By: Philip E. Mossy, President , Secretary Signature Page of Disposition and Development Agreement 017.262230.5 32 ATTACHMENT NO. 1 SITE MAP 017.262230.5 Attachment No. 1-1 S'OEZZ9Z'LLO j-[ "OM juat..ugo uv NATION J J.VrvPl TRANSPORTATION 1 3114 itliRsk.1,117444 4dr 9 ?1 7 Q 3 ] 1AC PAR 3 JMN Q f0 �ry L4� 15 Jf►• JJIYHI' pi3Y141 (COOLIDGE) NOV. WV AVE. • 1 (AVE.) . I JI.tl!I 31 ZyT AG. pAp1 1.h omLE NONE •NVI'Nvi L 41.N name AVE" POR W o MI i8 .1 © `EAROW3 /WE. . u JI A+1 552-34 "`n„',, ""'ice F7 G.1ES aLK JYG 1./ OLD NEW Zak 14* TL,13 YSVUT n Dig » PJ. T1wi1Y TyJ73►, floY 443 um•u3.Jf.11 ATTACHMENT NO. 2 SITE LEGAL DESCRIPTION Parcel A: (APN: 562-340-47) The northerly 164.00 feet of lot 5 of E. J. Christman Business and Industrial Park I, in the City of National City, County of San Diego, State of California, according to Map thereof No. 8038, Filed in the Office f the County Recorder of San Diego County, November 7, 1974. Parcel B: (APN: 562-340-48) Lot 5 of E. J. Christman Business and Industrial Park I, in the City of National City, County of San Diego, State of California, according to Map thereof No. 8038, Filed in the Office f the County Recorder of San Diego County, November 7, 1974. Excepting therefrom the northerly 164.00 feet. 017.262230.5 Attachment No. 2 ATTACHMENT NO. 3 RECORDING REQUESTED BY, ) MAIL TAX STATEMENTS TO AND ) WHEN RECORDED MAIL TO: ) ) ) ) ) ) ) This document is exempt from payment of a recording fee pursuant to Government Code Section 27383 GRANT DEED For valuable consideration, receipt of which is hereby acknowledged, the COMMUNITY DEVELOPMENT COMMISSION OF THE CITY OF NATIONAL CITY, a public body, corporate and politic (the "CDC"), acting to carry out the Redevelopment Plan ("Redevelopment Plan") for the National City Redevelopment Project (the "Project"), under the Community Redevelopment Law of California, as of , 200 , hereby grants to MOSSY NISSAN, INC., a California corporation ("Developer"), the real property hereinafter referred to as the "Site," described in Exhibit A attached hereto and incorporated herein, subject to the existing easements, restrictions and covenants of record described there. 1. Reservation of Mineral Rights. CDC excepts and reserves from the conveyance herein described all interest of the CDC in oil, gas, hydrocarbon substances and minerals of every kind and character lying more than five hundred (500) feet below the surface, together with the right to drill into, through, and to use and occupy all parts of the Site lying more than five hundred (500) feet below the surface thereof for any and all purposes incidental to the exploration for and production of oil, gas, hydrocarbon substances or minerals from said Site or other lands, but without, however, any right to use either the surface of the Site or any portion thereof within five hundred (500) feet of the surface for any purpose or purposes whatsoever, or to use the Site in such a manner as to create a disturbance to the use or enjoyment of the Site. 2. - Conveyance in Accordance With Redevelopment Plan, Disposition and Development Agreement. The Site is conveyed in accordance with and subject to the Redevelopment Plan which was approved and adopted by Ordinance No. 95-2095 of the City Council of the City of National City, and a Disposition and Development Agreement entered into between CDC and Developer dated July 26, 2005 (the "DDA"), a copy of which is on file with the CDC at its offices as a public record and which is incorporated herein by reference. The DDA generally requires the Developer to rehabilitate, remodel, construct and maintain in a first class condition a new automobile sales, service and repair facility and related parking on the Site, and other requirements as set forth therein (the "Improvements"). All terms used herein shall have the same meaning as those used in the DDA. Attachment No. 3-1 017.262230.5 3. Restrictions on Transfer. The Developer further agrees as follows: (a) For the period commencing upon the date of this Grant Deed and until the CDC's issuance of the Release of Construction Covenants as set forth in Section 310 of the DDA, no voluntary or involuntary successor in interest of the Developer shall acquire any rights or powers under the DDA or this Grant Deed, nor shall the Developer make any total or partial sale, transfer, conveyance, assignment, subdivision, without the prior written approval of the CDC or as otherwise permitted pursuant to Section 603 of the DDA. (b) The Developer shall not place or suffer to be placed on the Site any lien or encumbrance other than mortgages, deeds of trust, or any other form of conveyance required for financing of the construction of the Improvements on the Site, and any other expenditures necessary and or appropriate to develop the Site as provided in Section 310.2 of the DDA. . (c) All of the terms, covenants and conditions of this Grant Deed shall be binding upon the Developer and the permitted successors and assigns of the Developer. Whenever the term "Developer" is used in this Grant Deed, such term shall include any other successors and assigns as herein provided. 4. Nondiscrimination. The Developer herein covenants by and for itself, its heirs, executors, administrators and assigns, and all persons claiming under or through them, that there shall be no discrimination against or segregation of, any person or group of persons on account of race, color, creed, religion, sex, marital status, national origin or ancestry in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the land herein conveyed, nor shall the Developer itself or any person claiming under or through Developer, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sub lessees or vendees in the land herein conveyed. The foregoing covenants shall run with the land. The Developer shall refrain from restricting the rental, sale or lease of the Site on the basis of race, color, religion, sex, marital status, ancestry or national origin of any person. All such deeds, leases or contracts shall contain or be subject to substantially the following nondiscrimination or nonsegregation clauses: (a) In deeds: "The grantee herein covenants by and for himself or herself, his or her heirs, executors, administrators and assigns, and all persons claiming under or through them, that there shall be no discrimination against or segregation of, any person or group of persons on account of race, color, creed, religion, sex, marital status, national origin or ancestry in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the land herein conveyed, nor shall the grantee or any person claiming under or through him or her, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sub lessees or vendees in the land herein conveyed. The foregoing covenants shall run with the land." (b) In leases: "The lessee herein covenants by and for himself or herself, his or her heirs, executors, administrators, and assigns, and all persons claiming under or through him or her, and this lease is made and accepted upon and subject to the following conditions: Attachment No. 3-2 017.262230.5 "That there shall be no discrimination against or segregation of any person or group of persons, on account of race, color, creed, religion, sex, marital status, national origin, or ancestry in the leasing, subleasing, transferring, use, occupancy, tenure, or enjoyment of the premises herein leased nor shall the lessee himself or herself, or any person claiming under or through him or her, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use, or occupancy of tenants, lessees, sub lessees, subtenants, or vendees in the premises herein leased." (c) In contracts: "There shall be no discrimination against or segregation of, any person, or group of persons on account of race, color, creed, religion, sex, marital status, national origin, or ancestry, in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the premises, nor shall the transferee himself or herself or any person claiming under or through him or her, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sub lessees or vendees of the premises." 5. CDC Right of Reentry. The CDC has the right, at its election, to reenter and take possession of the Site, with all improvements thereon, and terminate and revest in the CDC the estate conveyed to the Developer if after the Closing and prior to the issuance of the Release of Construction Covenants, the Developer (or its successors in interest) shall: a. fail to start the construction of the Improvements as required by the DDA for a period of one hundred twenty (120) days after written notice thereof from the CDC; or b. abandon or substantially suspend construction of the Improvements required by the DDA for a period of one hundred twenty (120) days after written notice thereof from the CDC; or c. contrary to the provisions of Section 603 of the DDA transfer or suffer any involuntary Transfer in violation of the DDA, and such transfer has not been approved by the CDC or rescinded within sixty (60) days of notice thereof from CDC to Developer. Such right to reenter, terminate and revest shall be subject to and be limited by and shall not defeat, render invalid or limit: 1. Any mortgage or deed of trust permitted by the DDA; or 2. Any rights or interests provided in the DDA for the protection of the holders of such mortgages or deeds of trust. 3. Any rights or interests held by a lessee permitted by the DDA in and to the property. Attachment No. 3-3 017.262230.5 Upon the revesting in the CDC of title to the Site as provided in this Section 5, the CDC shall, pursuant to its responsibilities under state law, use its reasonable efforts to resell the Site as soon and in such manner as the CDC shall find feasible and consistent with the objectives of such law and of the Redevelopment Plan, as it exists or may be amended, to a qualified and responsible party or parties (as determined by the CDC) who will assume the obligation of making or completing the Improvements, or such improvements in their stead as shall be satisfactory to the CDC and in accordance with the uses specified for the Site or part thereof in the Redevelopment Plan. Upon such resale of the Site, the net proceeds thereof after repayment of any mortgage or deed of trust encumbering the Site which is permitted by this Agreement, shall be applied: i. First, to reimburse the CDC, on its own behalf or on behalf of the City, all costs and expenses incurred by the CDC, excluding City and CDC staff costs, but specifically, including, but not limited to, any expenditures by the CDC or the City in connection with the recapture, management and resale of the Site or part thereof (but less any income derived by the CDC from the Site or part thereof in connection with such management); all taxes, assessments and water or sewer charges with respect to the Site or part thereof which the Developer has not paid (or, in the event that Site is exempt from taxation or assessment of such charges during the period of ownership thereof by the CDC, an amount, if paid, equal to such taxes, assessments, or charges as would have been payable if the Site were not so exempt); any payments made or necessary to be made to discharge any encumbrances or liens existing on the Site or part thereof at the time or revesting of title thereto in the CDC, or to discharge or prevent from attaching or being made any subsequent encumbrances or liens due to obligations, defaults or acts of the Developer, its successors or transferees; any expenditures made or obligations incurred with respect to the making or completion of the improvements or any part thereof on the Site, or part thereof; and any amounts otherwise owing the CDC, and in the event additional proceeds are thereafter available, then ii. Second, to reimburse the Developer, its successor or transferee, up to the amount equal to the sum of (a) the costs incurred for the acquisition and development of the Site and for the improvements existing on the Site at the time of the reentry and possession. Any balance remaining after such reimbursements shall be retained by the CDC as its property. The rights established in this Section 6 are not intended to be exclusive of any other right, power or remedy, but each and every such right, power, and remedy shall be cumulative and concurrent and shall be in addition to any other right, power and remedy authorized herein or now or hereafter existing at law or in equity. These rights are to be interpreted in light of the fact that the CDC will have conveyed the Site to the Developer for redevelopment purposes. 6. Violations Do Not Impair Liens. No violation or breach of the covenants, conditions, restrictions, provisions or limitations contained in this Grant Deed shall defeat or render invalid or in any way impair the lien or charge of any mortgage or deed of trust or security interest permitted by paragraph 4 of this Grant Deed; provided, however, that any subsequent owner of the Site shall be bound by such remaining covenants, conditions, restrictions, limitations and provisions, whether such owner's title was acquired by foreclosure, deed in lieu of foreclosure, trustee's sale or otherwise. 017.262230.5 Attachment No. 3-4 7. Covenants Run With Land. All covenants contained in this Grant Deed shall be covenants running with the land. All of Developer's obligations hereunder except as provided hereunder shall terminate and shall become null and void upon the expiration of the Redevelopment Plan. Every covenant contained in this Grant Deed against discrimination contained in paragraph 4 of this Grant Deed shall remain in effect in perpetuity. 8. Covenants For Benefit of CDC. All covenants without regard to technical classification or designation shall be binding for the benefit of the CDC, and such covenants shall run in favor of the CDC for the entire period during which such covenants shall be in force and effect, without regard to whether the CDC is or remains an owner of any land or interest therein to which such covenants relate. The CDC, in the event of any breach of any such covenants, shall have the right to exercise all the rights and remedies and to maintain any actions at law or suits in equity or other proper proceedings to enforce the curing of such breach. 9. Revisions to Grant Deed. Both CDC, its successors and assigns, and Developer and the successors and assigns of Developer in and to all or any part of the fee title to the Site shall have the right with the mutual consent of the CDC to consent and agree to changes in, or to eliminate in whole or in part, any of the covenants, easements or restrictions contained in this Grant Deed without the consent of any tenant, lessee, easement holder, licensee, mortgagee, trustee, beneficiary under a deed of trust or any other person or entity having any interest less than a fee in the Site. However, Developer and CDC are obligated to give written notice to and obtain the consent of any first mortgagee prior to consent or agreement between the parties concerning such changes to this Grant Deed. The covenants contained in this Grant Deed, without regard to technical classification, shall not benefit or be enforceable by any owner of any other real property within or outside the Project Area, or any person or entity having any interest in any other such realty. No amendment to the Redevelopment Plan shall require the consent of the Developer. 10. Enforced Delay; Extension of Times of Performance. In addition to specific provisions of this Agreement, performance by either party hereunder shall not be deemed to be in Default, and all performance and other dates specified in this Agreement shall be extended, where delays or Defaults are due to causes beyond the reasonable control or without the fault of the party claiming an extension of time to perform, which may include the following: war; insurrection; strikes; lockouts; riots; floods; earthquakes; fires; casualties; acts of God; acts of the public enemy; epidemics; quarantine restrictions; freight embargoes; lack of transportation; governmental restrictions or priority; litigation; severe weather; inability to secure necessary labor, materials or tools; delays of any contractor, subcontractor or supplier; acts or omissions of the other party; acts or failures to act of the City or any other public or governmental CDC or entity (other than the acts or failures to act of the CDC which shall not excuse performance by the CDC) (an "Enforced Delay"). Notwithstanding anything to the contrary in this Agreement, an extension of time for any such cause shall be for the period of the Enforced Delay and shall commence to run from the time of the commencement of the cause, if notice by the party claiming such extension is sent to the other party within thirty (30) days of the commencement of the cause. Times of performance under this Agreement may also be extended in writing by the mutual agreement of CDC and Developer. Notwithstanding any provision of this Agreement to the contrary, the lack of funding to complete the Improvements shall not constitute grounds of Enforced Delay pursuant to this Section 10. Attachment No. 3-5 017.262230.5 CDC: COMMUNITY DEVELOPMENT COMMISSION OF THE OF THE CITY OF NATIONAL CITY, a public body, corporate and politic By: Nick Inzunza, Chairman ATTEST: , CDC Secretary APPROVED AS TO FORM: CDC Counsel MOSSY NISSAN, INC., a California corporation By: By: Philip E. Mossy, President Signature Page of Grant Deed , Secretary Attachment No. 3-6 017.262230.5 EXHIBIT "A" LEGAL DESCRIPTION OF SITE Parcel A: (APN: 562-340-47) The northerly 164.00 feet of lot 5 of E. J. Christman Business and Industrial Park I, in the City of National City, County of San Diego, State of California, according to Map thereof No. 8038, Filed in the Office f the County Recorder of San Diego County, November 7, 1974. Parcel B: (APN: 562-340-48) Lot 5 of E. J. Christman Business and Industrial Park I, in the City of National City, County of San Diego, State of California, according to Map thereof No. 8038, Filed in the Office f the County Recorder of San Diego County, November 7, 1974. Excepting therefrom the northerly 164.00 feet. Exhibit A-1 017.262230.5 ATTACHMENT NO. 4 SCHEDULE OF PERFORMANCE GENERAL PROVISIONS 1. Approval and Execution Disposition and Development Agreement ("Agreement") CDC shall consider this Agreement and, if approved, shall authorize, execute and deliver the Agreement to Developer. ACQUISITION AND POSSESSION 2. Acquisition and Possession If appropriate and necessary, CDC may make the necessary findings, conduct appropriate public hearings and take all necessary actions to acquire possession of the Property. 3. Developer Election to Make Possession Deposit 4. Open Escrow If applicable, CDC and Developer shall open an escrow for the purpose of CDC conveying Property to Developer. 5. Satisfy Conditions Precedent CDC and Developer shall satisfy or waive all of their respective Conditions Precedent to Close of Escrow. 6. Close Escrow CDC shall either convey possession and/or fee title to the Property to Developer and Escrow shall close. August 23, 2005 August 23, 2005 through December 31, 2007. November 1, 2005 No later than thirty (30) days after CDC possession of the Site or concurrent with Developer election to make Possession Deposit. No later than earlier of thirty (30) days after CDC acquires title to the Property through negotiated purchase or through an Order of Possession and/or Final Order of Condemnation. No later than thirty (30) days after satisfaction or waiver of all Conditions Precedent to Close of Escrow. Attachment No. 4-1 017.262230.5 SCHEDULE OF PERFORMANCE CONSTRUCTION 7. Preliminary Design Developer shall complete preliminary design and submit to CDC for review. 8. Preliminary Design Approval CDC shall review, request modifications if necessary and approve preliminary design 9. Construction Drawings and approval Applications Developer shall submit to CDC Construction Drawings, including application materials required by City Planning Services to obtain City approvals for construction of Improvements. 10. Review and Approval Construction Drawings CDC shall review, request modifications if necessary, and approve Construction Drawings. During this period of time, CDC staff and Developer shall hold progress meetings to coordinate preparation, review and modification of Construction Drawings and applications. Building permits shall be issued. 11. Submit final Construction Drawings Developer shall submit its final revision of Construction Drawings. 12. Building Permits Building Permits shall be issued. 13. Commence Construction Developer shall commence construction of the No later than sixty (60) days after earlier of (i) CDC obtaining order of possession, or (ii) Close of Escrow. Thirty (30) days after receipt by CDC. One hundred twenty (120) days after earlier of: (i) CDC obtaining order of possession; or (ii) Close of Escrow. Thirty (30) days after CDC receipt of Construction Drawings. Thirty (30) days after receipt of CDC comments. Ninety (90) days after submittal of final construction drawings. Thirty (30) days after receipt of permits. Attachment No. 4-2 017.262230.5 SCHEDULE OF PERFORMANCE Improvements of the Site. 14. Complete Construction Two hundred forty (240) days after commencement of Developer shall complete construction of the construction. Improvements on the Site. Attachment No. 4-3 01I7.262230.5 ATTACHMENT NO. 5 SCOPE OF DEVELOPMENT The Improvements shall consist of new buildings for the Mossy Nissan Dealership, all to be built in accordance with the new Nissan Image Program and shall consist of the following: Approximately 35,000 - 40,000 square feet of new buildings consisting of (a) Showroom/Sales Offices of approximately 6,000 - 8,000 square feet; (b) Service/Detail/Body Shop Bays (approximately 30-40 Bays) of approximately 26,000 square feet; and (c) Parts Department of approximately 8,000 square feet. Attachment No. 5-1 017.262230.5 ATTACHMENT NO. 6 RECORDING REQUESTED BY, ) MAIL TAX STATEMENTS TO AND ) WHEN RECORDED MAIL TO: ) ) ) ) ) ) ) This document is exempt from payment of a recording fee pursuant to Goverment Code Section 27383 RELEASE OF CONSTRUCTION COVENANTS THIS RELEASE OF CONSTRUCTION COVENANTS (the "Release") is made by the COMMUNITY DEVELOPMENT COMMISSION OF THE CITY OF NATIONAL CITY, a public body, corporate and politic (the "CDC"), in favor of MOSSY NISSAN, INC., a California corporation (the "Developer"), as of the date set forth below. RECITALS A. The CDC and the Developer have entered into that certain Disposition and Development Agreement (the "DDA") dated concerning the redevelopment of certain real property situated in the City of National City, California as more fully described in Exhibit "A" attached hereto and made a part hereof. B. As referenced in Section 309 of the DDA, the CDC is required to furnish the Developer or its successors with a Release of Construction Covenants upon completion of construction of the Improvements (as defined in Section 100 of the DDA), which Release is required to be in such form as to permit it to be recorded in the Recorder's office of San Diego County. This Release is conclusive determination of satisfactory completion of the construction and development required by the DDA. C. The CDC has conclusively determined that such construction and development has been satisfactorily completed. NOW, TIIEREFORE, the CDC hereby certifies as follows: 1. The Improvements to be constructed by the Developer have been fully and satisfactorily completed in conformance with the DDA. Any operating requirements and all use, maintenance or nondiscrimination covenants contained in the DDA and other documents executed and recorded pursuant to the DDA shall remain in effect and enforceable according to their terms. Attachment No. 6-1 017.262230.5 2. Nothing contained in this instrument shall modify in any other way any other provisions of the DDA. IN WITNESS WHEREOF, the CDC has executed this Release this _ day of 200 COMMUNITY DEVELOPMENT COMMISSION OF THE OF THE CITY OF NATIONAL CITY, a public body, corporate and politic By: Nick Inzunza, Chairman ATTEST: , CDC Secretary APPROVED AS TO FORM: CDC Counsel Attachment No. 6-2 017.262230.5 EXHIBIT "A" SITE DESCRIPTION Parcel A: (APN: 562-340-47) The northerly 164.00 feet of lot 5 of E. J. Christman Business and Industrial Park I, in the City of National City, County of San Diego, State of California, according to Map thereof No. 8038, Filed in the Office f the County Recorder of San Diego County, November 7, 1974. Parcel B: (APN: 562-340-48) Lot 5 of E. J. Christman Business and Industrial Park I, in the City of National City, County of San Diego, State of California, according to Map thereof No. 8038, Filed in the Office f the County Recorder of San Diego County, November 7, 1974. Excepting therefrom the northerly 164.00 feet. 017.262230.5 Exhibit A ATTACHMENT NO. 7 RECORDING REQUESTED BY AND WHEN RECORDED RETURN TO: FOLEY & LARDNER LLP Attn: Richard L. Moskitis 402 West Broadway, Suite 2300 San Diego, California 92101-3542 APNs: 562-340-47 562-340-48 OPERATING COVENANT THIS OPERATING COVENANT is made this day of , 200 , by and between the COMMUNITY DEVELOPMENT COMMISSION OF THE CITY OF NATIONAL CITY, a public body, corporate and politic (the "Agency"), and MOSSY NISSAN, INC., a California corporation (the "Participant"), with reference to the following: A. The Agency and the Participant have executed a Disposition and Development Agreement (the "Agreement"), dated as of July 26, 2005 which provides for the development of certain real property located in the City of National City (the "City"), County of San Diego, State of California, more fully described in Exhibit "A" attached hereto and incorporated herein by this reference (the "Site"). The Agreement is available for public inspection and copying at the office of the Agency, 140 E. 12th Street, Suite B, National City, California. All of the terms, conditions, provisions and covenants of the Agreement are incorporated in this Operating Covenant by reference as though written out at length herein and the Agreement and this Operating Covenant shall be deemed to constitute a single instrument or document. Capitalized terms used herein and not otherwise defined shall have the same meaning as set forth in the Agreement. B. The Agreement provides for, among other things, the Participant's conveyance to the Agency of an operating covenant with respect to the Improvements on the Site (the "Facility"). NOW, THEREFORE, the Participant hereby conveys to the Agency the following Operating Covenant: 1. Operation of Automobile Dealership. For a term commencing upon the date that the City issues a certificate of occupancy for the Facility, and ending upon the tenth anniversary thereof (which ten year period constitutes the "Operating Covenant Period"), the Participant hereby covenants and agrees to operate (or cause its successors or assigns to operate) the Facility on the Site on a continuous basis, devoted to the sale of new automobiles and trucks as a factory - authorized new automobile dealer as the principal activity conducted on the Site. The sale of used automobiles and trucks, and the servicing and repair of vehicles may also be conducted on the Site Attachment No. 7-1 017.262230.5 as a secondary use. In addition, the Participant shall conduct all activities for the leasing of automobiles from the Facility either on the site or at an office located within the City of National City. No other uses may be made on the Site during the Operating Covenant Period without the prior written approval of the Agency, which approval may be withheld in Agency's sole discretion. The requirements of this Section 1 shall run with the land. 2. Nondiscrimination. The Participant by and for itself and any successors in interest covenants that there shall be no discrimination against or segregation of any person or group of persons on account of race, color, creed, religion, sex, marital status, physical or mental disability or medical condition, national origin or ancestry in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the Site, nor shall the Participant itself or any person claiming under or through it establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees or vendees of the Site. The foregoing covenants shall run with the land. All such deeds, leases or contracts shall contain or be subject to substantially the following nondiscrimination or nonsegregation clauses: i. In deeds: "The grantee herein covenants by and for himself or herself, his or her heirs, executors, administrators and assigns, and all persons claiming under or through them, that there shall be no discrimination against or segregation of, any person or group of persons on account of race, color, creed, religion, sex, marital status, physical or mental disability or medical condition, national origin or ancestry in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the land herein conveyed, nor shall the grantee himself or herself or any person claiming under or through him or her, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees or vendees in the land herein conveyed. The foregoing covenants shall run with the land." ii. In leases: "The lessee herein covenants by and for himself or herself, his or her heirs, executors, administrators and assigns, and all persons claiming under or through him or her, and this lease is made and accepted upon and subject to the following conditions: "There shall be no discrimination against or segregation of any person or group of persons on account of race, color, creed, religion, sex, marital status, physical or mental disability or medical condition, ancestry or national origin in the leasing, subleasing, transferring, use, occupancy, tenure or enjoyment of the premises herein leased nor shall the lessee himself or herself, or any person claiming under or through him or her, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, sublessees, subtenants or vendees in the premises herein leased." iii. In contracts: "There shall be no discrimination against or segregation of, any person, or group of persons on account of race, color, creed, religion, sex, marital status, physical or mental disability or medical condition, ancestry or national origin, in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the premises, nor shall the transferee himself or herself or any person claiming under or through him or her, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees or vendees of the premises." 017.262230.5 Attachment No. 7-2 This covenant regarding non-discrimination shall remain in effect in perpetuity. 3. Performance of Maintenance. a. Participant shall maintain the Site and the Facility in a first class condition, including, but not limited to, buildings, sidewalks, pedestrian lighting, landscaping, irrigation of landscaping, architectural elements identifying the Site and any and all other improvements on the Site. b. To accomplish the maintenance, Participant shall either staff or contract with and hire licensed and qualified personnel to perform the maintenance work, including the provision of labor, equipment, materials, support facilities, and any and all other items necessary to comply with the requirements of this Operating Covenant. c. The following standards ("Maintenance Standards") shall be complied with by Participant and its maintenance staff, contractors or subcontractors: i. Landscape maintenance shall include, but not be limited to: watering/irrigation; fertilization; mowing; edging; trimming of grass; tree and shrub pruning; trimming and shaping of trees and shrubs to maintain a healthy, natural appearance and safe road conditions and visibility, and irrigation coverage; replacement, as needed, of all plant materials; control of weeds in all planters, shrubs, lawns, ground covers, or other planted areas; and staking for support of trees. ii. Clean-up maintenance shall include, but not be limited to: maintenance of all sidewalks, paths and other paved areas in clean and weed -free condition; maintenance of all such areas clear of dirt, mud, trash, debris or other matter which is unsafe or unsightly; removal of all trash, litter and other debris from improvements and landscaping prior to mowing; clearance and cleaning of all areas maintained prior to the end of the day on which the maintenance operations are performed to ensure that all cuttings, weeds, leaves and other debris are properly disposed of by maintenance workers. iii. All maintenance work shall conform to all applicable federal and state Occupational Safety and Health Act standards and regulations for the performance of maintenance. iv. Any and all chemicals, unhealthful substances, and pesticides used in and during maintenance shall be applied in strict accordance with all governing regulations. Precautionary measures shall be employed recognizing that all areas are open to public access. v. The Site and Facility shall be maintained in conformance and in compliance with the approved Site construction and architectural plans and design scheme, as the same may be amended from time to time with the approval of the City, and reasonable commercial development maintenance standards for similar projects, including, but not limited to: painting and cleaning of all exterior surfaces and other exterior facades comprising all private improvements and public improvements to the curb line. Attachment No. 7-3 017.262230.5 vi. The Site and Facility shall be maintained as required by this Section 3 in good condition and in accordance with the custom and practice generally applicable to comparable automobile dealership facilities located in Southern California. 4. Failure to Maintain Site and Facility. In the event Participant does not maintain the Site or the Facility in the manner set forth herein and in accordance with the Maintenance Standards, Agency and/or City shall have the right to maintain such private and/or public improvements, or to contract for the correction of such deficiencies, after written notice to Participant. However, prior to taking any such action, Agency agrees to notify Participant in writing if the condition of said improvements do not meet with the Maintenance Standards and to specify the deficiencies and the actions required to be taken by Participant to cure the deficiencies. Upon notification of any maintenance deficiency, Participant shall have thirty (30) days within which to correct, remedy or commerce and diligently pursue the cure the deficiency. If the written notification states the problem is urgent relating to the public health and safety of the City or the Agency, then Participant shall have forty-eight (48) hours to rectify the problem. In the event Participant fails to correct, remedy, or cure or has not commenced correcting, remedying or curing such maintenance deficiency after notification and after the period of correction has lapsed, then City and/or Agency shall have the right to maintain such improvements. Participant agrees to pay Agency such charges and costs. Until so paid, the Agency shall have a lien on the Site for the amount of such charges or costs, which lien shall be perfected by the recordation of a `Notice of Claim of Lien" against the Site. Upon recordation of a Notice of a Claim of Lien against the Site, such lien shall constitute a lien on the fee estate in and to the Site prior and superior to all other monetary liens except: (i) all taxes, bonds, assessments, and other levies which, by law, would be superior thereto; (ii) the lien or charge of any mortgage, deed of trust, or their security interest then of record made in good faith and for value, it being understood that the priority of any such lien for costs incurred to comply with this Agreement shall date from the date of the recordation of the Notice of Claim of Lien. Any such lien shall be subject and subordinate to any lease or sublease of the interest of Participant in the Site or any portion thereof and to any easement affecting the Site or any portion thereof entered into at any time (either before or after) the date of recordation of such a Notice. Any lien in favor of the Agency created or claimed hereunder is expressly made subject and subordinate to any mortgage or deed of trust made in good faith and for value, recorded as of the date of the recordation of the Notice of Claim of Lien describing such lien as aforesaid, and no such lien shall in any way defeat, invalidate, or impair the obligation or priority of any such mortgage or deed of trust, unless the mortgage or beneficiary thereunder expressly subordinates his interest, of record, to such lien. No lien in favor of the Agency created or claimed hereunder shall in any way defeat, invalidate, or impair the obligation or priority of any lease, sublease or easement unless such instrument is expressly subordinated to such lien. Upon foreclosure of any mortgage or deed of trust made in good faith and for value and recorded prior to the recordation of any unsatisfied Notice of Claim of Lien, the foreclosure - purchaser shall take title to the Site free of any lien imposed by the Agency that has accrued up to the time of the foreclosure sale, and upon taking title to the Site, such foreclosure -purchaser shall only be obligated to pay costs associated with this Agreement accruing after the foreclosure - purchaser acquires title to the Site. If the Site is ever legally divided with the written approval of the Agency and fee title to various portions of the Site is held under separate ownerships, then the burdens of the maintenance obligations set forth herein and in this Agreement and the charges levied by the Agency to reimburse the Agency for the cost of undertaking such maintenance obligations of Participant and its successors and the lien for such charges shall be apportioned Attachment No. 7-4 017.262230.5 among the fee owners of the various portions of the Site under different ownerships according to the square footage of the land contained in the respective portions of the Site owned by them. Upon apportionment, no separate owner of a portion of the Site shall have any liability for the apportioned liabilities of any other separate owner of another portion of the Site, and the lien shall be similarly apportioned and shall only constitute a lien against the portion of the Site owned in fee by the owner who is liable for the apportioned charges levied by the Agency and secured by the apportioned lien and against no other portion of the Site. Participant acknowledges and agrees City and Agency may also pursue any and all other remedies available in law or equity. Participant shall be liable for any and all attorneys' fees, and other legal costs or fees incurred in collecting said maintenance costs. 5. Compliance with Law. Participant shall comply with all local, state and federal laws relating to the uses of or condition of the Site and the Facility. 6. Effect of Violation of the Terms and Provisions of this Operating Covenant. The covenants established in this Operating Covenant shall, without regard to technical classification and designation, be binding for the benefit and in favor of the Agency, its successors and assigns, as to those covenants which are for its benefit. The covenants contained in this Operating Covenant shall remain in effect for the periods of time specified therein. The Agency is deemed the beneficiary of the terms and provisions of this Operating Covenant and of the covenants running with the land, for and in its own rights and for the purposes of protecting the interests of the community and other parties, public or private, in whose favor and for whose benefit this Operating Covenant and the covenants running with the land have been provided. The Operating Covenant and the covenants shall run in favor of the Agency, without regard to whether the Agency has been, remains or is an owner of any land or interest therein in the Site or in the Project Area. The Agency shall have the right, if the Operating Covenant or covenants are breached, to exercise all rights and remedies, and to maintain any actions or suits at law or in equity or other proper proceedings to enforce the curing of such breaches to which it or any other beneficiaries of this Operating Covenant and covenants may be entitled. 7. Miscellaneous Provisions. a. If any provisions of this Operating Covenant or portion thereof, or the application to any person or circumstances, shall to any extent be held invalid, inoperative or unenforceable, the remainder of this Operating Covenant, or the application of such provision or portion thereof to any other persons or circumstances, shall not be affected thereby; it shall not be deemed that any such invalid provision affects the consideration for this Operating Covenant; and each provision of this Operating Covenant shall be valid and enforceable to the fullest extent permitted by law. b. This Operating Covenant shall be construed in accordance with the laws of the State of Califomia. c. This Operating Covenant shall be binding upon and inure to the benefit of the successors and assigns of the Participant. d. In the event action is instituted to enforce any of the provisions of this Operating Covenant, the prevailing party in such action shall be entitled to recover from the other party thereto as part of the judgment, reasonable attorney's fees and costs. Attachment No. 7-5 017.262230.5 IN WITNESS WHEREOF, the parties hereto have executed this instrument the day and year first hereinabove written. ATTEST: , CDC Secretary APPROVED AS TO FORM: CDC Counsel AGENCY: COMMUNITY DEVELOPMENT COMMISSION OF THE OF THE CITY OF NATIONAL CITY, a public body, corporate and politic By: Nick Inzunza, Chairman PARTICIPANT: MOSSY NISSAN, INC., a California corporation By: By: Philip E. Mossy, President , Secretary Signature Page of Operating Covenant 017.262230.5 Attachment No. 7-6 - '1 } EXHIBIT A LEGAL DESCRIPTION OF SITE Parcel A: (APN: 562-340-47) The northerly 164.00 feet of lot 5 of E. J. Christman Business and Industrial Park 1, in the City of National City, County of San Diego, State of California, according to Map thereof No. 8038, Filed in the Office f the County Recorder of San Diego County, November 7, 1974. Parcel B: (APN: 562-340-48) Lot 5 of E. J. Christman Business and Industrial Park I, in the City of National City, County of San Diego, State of California, according to Map thereof No. 8038, Filed in the Office f the County Recorder of San Diego County, November 7, 1974. Excepting therefrom the northerly 164.00 feet. Exhibit A - Page 1 017.262230.5 SUMMARY REPORT PERTAINING TO THE SALE OF REAL PROPERTY (California Community Redevelopment Law Section 33433) PURSUANT TO A PROPOSED DISPOSITION AND DEVELOPMENT AGREEMENT Between: COMMUNITY DEVELOPMENT COMMISSION OF THE CITY OF NATIONAL CITY And: MOSSY NISSAN, INC. Prepared by: KEYSER MARSTON ASSOCIATES, INC. For: COMMUNITY DEVELOPMENT COMMISSION OF THE CITY OF NATIONAL CITY Date: August 8, 2005 Attachment 4 SUMMARY REPORT PERTAINING TO THE PROPOSED SALE OF REAL PROPERTY I. INTRODUCTION The Community Development Commission of the City of National City (Commission) is considering the acquisition and sale of real property to Mossy Nissan, Inc. (Developer) pursuant to a Disposition and Development Agreement (DDA) under review as of August 1, 2005. This Summary Report is prepared in accordance with Section 33433 of the California Community Redevelopment Law. This summary consists of six additional sections, as follows: • Section II, Description of the Proposed Project • Section III, Estimated Costs to be Incurred by the Commission under the Proposed DDA • Section IV, Estimated Fair Re -Use Value of the Interest to be Conveyed • Section V, Estimated Value of the Site at the Highest and Best Use • Section VI, Purchase Price the Developer w ill be Required to Pay • Section VII, Explanation Why the Sale of the Property will Assist in Elimination of Blight Summary Report Mossy Nissan, Inc. 16704.002.035 05373mm August 8, 2005 Page 2 1I. DESCRIPTION OF THE PROPOSED PROJECT A. Proposed Transaction The Developer intends to remodel the existing Nissan dealership located at 2626 to 2700 National City Boulevard. The dealership is situated on a 4.53-acre site (Site), which is being leased to the Developer by the current property owner. It is KMA's understanding that the current lease has 2.5 years remaining with one five year renewal option at market rent, but the Developer does not intend to exercise the option. The Site is improved with four buildings comprising approximately 43,000 square feet {SF), which includes a showroom, office space, and service bays. The Site is bounded by National City Boulevard, Transportation Avenue, and 26th and 28'" Streets in National City. Specifically, the Site is located on the City's main retail thoroughfare, National City Boulevard, and is rectangular in shape, essentially flat, and at grade with the frontage roads. A major part of this arterial street has been designated and zoned as an automobile park known as the "Mile of Cars". Although the area is exclusively zoned for new automobile dealerships, some pre-existing non -automotive retail uses remain. The proposed transaction is detailed in the Disposition and Development Agreement (DDA) under review as of August 1, 2005. The DDA governs the relationship between the Commission and the Developer with respect to the proposed development of the Site, the schedule of performance, and the method of financing. Key terms of the DDA are summarized below. B. Agency and Developer Responsibilities • The Developer will attempt to acquire the Site thro ugh private negotiation w ith the property owner. • If the Developer is unsuccessful in acquiring the Site, the Commission in its absolute and sole discretion can de cide to initiate eminent domain proceedings. Upon acquisition of the Site, the Commission will convey fee ownership of the Site to the Developer at a price equ al to the price paid by the Commission to acquire the Site. • If the Commission decides to use its power of eminent domain, the Developer will advance to the Commission the Possession Deposit. • The Developer will pay a Purchase Price to the Commission in the amount of: (a) the actual price negotiated by the Commission for acquisition of the Site, plus any Summary Report Mossy Nissan, Inc. 76104.002.035 05373mm August 8, 2005 Page 3 other acquisition costs incurred by the Commission; or (b) the amount of just compensation awarded to the current property owner, plus the amount of acquisition costs incurred by Commission, such as completion of the eminent domain proceedings, and the amount necessary to satisfy any judgment in the action. • If the condemnation action is greater than $8 million, the Commission will attempt to abandon condemnation proceedings at the option of the Developer. • It is the belief and understanding of the Commission and the Developer that the DDA between the parties does not involve a "public w ork" as defined by the State prevailing wage laws, since the Developer will purchase the Site from the Commission for its fair market value without public subsidy. • The Developer agrees to devote the Site to the sale of new automobiles and trucks as a factory -authorized new automobile dealer as the principal activity conducted on the Site for a minimum of 10 years. Summary Report Mossy Nissan, Inc. 16104.002.035 05373mm August 8. 2005 Page 4 III. ESTIMATED COST TO BE INCURRED BY THE COMMISSION UNDER THE PROPOSED AGREEMENT Costs to the Commission related directly to development of the Site are itemized below. They consist of the following: (1) Commission Costs Site Acquisition (Estimate) $7,000,000 Other Agency Acquisition Costs TBD DDA Costs (Legal, Economic, and Appraisal) (2) $25.000 Total Commission Costs $7,025,000 (Less) Purchase Price from Developer (not less than Site Acquisition Cost) ($7,000,000) (Less) Reimbursement to Commission for Other Commission Acquisition Costs (TBD) (Less) Reimbursement from Developer for Commission DDA Costs ($25.0001 Net Commission Costs $0 (1) All figures provided by the Community Development Commission of ;national City, except as noted. (2) Gress estimate. Summary Repoli Mossy Nissan, Inc. 16104.002.035 05373mm August 8, 2005 Page 5 IV. ESTIMATED FAIR RE -USE VALUE OF THE INTEREST TO BE CONVEYED This section presents an analysis of the fair re -use value of the interest to be conveyed to the Developer. Re -use value is defined as the highest price in terms of cash or its equivalent which a property or development right is expected to bring for a specified use in a competitive open market, subject to the covenants, conditions, and restrictions imposed by the DDA. The proposed DDA sets specific conditions with respect to the scope of development, the schedule of performance, and method of financing. The Commission contracted with John G. Slagle, MAI, of Real Estate Professionals to conduct an appraisal of the Site. The appraiser determined the fair market value of the fee simple interest of the Site "As Is" as of April 30, 2005. The appraiser concluded that the fair market value for the Site is $7,000,000, or approximately $33 per SF. On this basis, then, K MA concludes that the fair re -use value of the Site is estimated to be $7,000,000, or $33 per SF land. Summary Report Mossy Nissan, Inc. 76704 002 035 05373mm August 8, 2005 Page 6 V. ESTIMATED VALUE OF THE SITE AT THE HIGHEST AND BEST USE This section presents an analysis of the fair market value of the Site at its highest and best use. In appraisal terminology, the highest and best use is that use of the property that generates the highest property value and is physically possible, financially feasible, and legally permitted. Therefore, value at the highest and best use is based solely on the value created and not on whether or not that use carries out the redevelopment goals of the City of National City. The Redevelopment Plan of the City of National City governs the Site and regulates the zoning and land uses for the Site. The Site is zoned for commercial automotive within a planned development overlay (CA-PD). The zoning strictly allows only for new car dealerships. On this basis, then, KMA concludes that the proposed use represents the highest and best use of the Site. Therefore, the fair market value at highest and be st use is equal to the fair re -use value, or $7,000,000, or $33 per SF land. Summary Report Mossy Nissan, Inc. 76104 002.035 05373mm August 8, 2005 Page 7 VI. PURCHASE PRICE WHICH THE DEVELOPER WILL BE REQUIRED TO PAY Under California Community Redevelopment Law, the Commission is obligated to publicly disclose information sufficient for a comparison of the purchase price contained in the proposed DDA with the estimated fair re -use value as described below. On this basis, then, KMA concludes that the effective compensation to the Commission is $7,000,000. Summary Report Mossy Nissan, Inc. 16104.002.035 05373mm August 8, 2005 Page 8 VII. EXPLANATION WHY SALE OF THE PROPERTY WILL ASSIST IN THE ELIMINATION OF BLIGHT The Project Area is characterized by an array of blighting factors, including: • The age, obsolescence, deterioration, mixed character, or shifting uses of existing buildings within the Project Area. • The subdividing and sale of lots of irregular form and shape, and inadequate size, for proper usefulness and development. • A prevalence of depreciated values and im paired investments, and social and economic maladjustment. • The defective design in character or physical condition of existing buildings. Not all of these conditions are present throughout the Project Area. The Commission's redevelopment efforts have successfully alleviated blighting conditions in some portions of the Project Area. Implementation of the proposed development can be expected to assist in the alleviation of blighting conditions through the following: • Consolidation of irregular parcels into a site appropriate for development. • Elimination of conditions of economic dislocation such as fragmented ownership patterns. • Expansion, renovation, and relocation of businesses within the Project Area. Summary Report Mossy Nissan; Inc. 16704.002.035 05373mm August 8, 2005 Page 9 COMMUNITY DEVELOPMENT COMMISSION Of THE CITY OF NATIONAL CITY August 23, 2005 AGENDA ITEM NO. 2 TO: CHAIRMAN AND BOARD MEMBERS { Y Y FROM: BENJAMIN MARTINEZ, EXECUTIVE DIRECTOR VIA: JEANETTE LADRLDO, DEP TY DIRECTOR Of FINANCE AND ADMINISTRATION SUBJECT: RATIFICATIONS: EXPENDITURES FOR THE PERIOD OF 07/27/05 THROUGH 08/12/05 Recommendation: Community Development Commission staff recommends that the Community Development Commission Board: RATIFY EXPENSES. Fiscal Impact: Total expenditures for the period of 07/27/05 THROUGH 08/12/05 amount to $1,513,161.66. Environmental Report: Not Applicable. Background: See attached report. Community Development Commission Agenda item No. 2 August 23, 2005 Page 1 of 1 Payee CDC Al PARTY RENTALS Al PARTY RENTALS A5 COMPUTER SERVICES AMARR ENTERPIRSES ARROWHEAD MTN SPRING WTR CO. ARROWHEAD MTh SPRING WTR CO. ATANGAN, NORMITA BEAU HART BENNETT PEII DESIGN CA DOWNTOWN ASSOCIATION CHRISTENSEN SCHWERDTFEGER CHRISTENSEN SCHWERDTFEGER CITY OF NATIONAL CITY CITY OF NATIONAL CITY CITY OF NATIONAL CITY CITY OF NATIONAL CITY CITY TREASURER CITY TREASURER CORPORATE EXPRESS INC DEPT OF ENVIRONMENTAL HEALTH DPRA INC. ENVIRONMENTAL BUSINESS SOLUTION ESTRADA LAND PLANNING EVERGREEN NURSERY FEDERAL EXPRESS FEDERAL EXPRESS FIERRO CONSTRUCTION FIERRO CONSTRUCTION FOLEY & LARDNER GOLUB & MORALES, LLP GRAPHIC SOLUTIONS HARRIS & ASSOCIATES HARRIS & ASSOCIATES HEFFLER COMPANY. INC. JOBS AVAILABLE INC KEYSER MARSTON ASSOCIATES. INC KLEINFELDER. INC. LAND AMERICA COMMONWEALTH LAND AMERICA COMMONWEALTH LASER SAVER. INC. LASER SAVER. INC. LAW OFFICE OF DON DETISCH LAW OFFICE OF DON DETISCH LEHMANN. ELIZABETH LINTVEDT, MC COLL & ASSOCIATES LUCE FORWARD HAMILTON & MARTINEZ BENJAMIN MAYER REPROGRAPHICS. INC MOTIVATIONAL SYSTEMS INC MUNICIPAL RESOURCE CENTER MUNICIPAL RESOURCE CENTER NASLAND ENGINEERING NATIONAL CITY SENIOR NUTRITION NATIONAL TRUST FOR HISTORIC NAZARENO,ANGELA OFFICE TEAM OPPER & VARCO LLP OPPER & VARCO LLP OPPER & VARCO LLP OPPER & VARCO LLP OVERLAND PACIFIC & CUTLER. INC FOR MEETING OF AUGUST 23, 2005 RATIFICATION OF EXPENDITURES FOR PERIOD: 07/27/05 - 08/12/05 Description mr� MAYORS STATE OF THE CITY CATERING MAYORS STATE OF THE CITY -LINENS CHARGES FOR MOVING PHONE LINE HIGHLAND AVE BUSINESS ASSOC T-SHIRTS S8 WATER FILTER MONTHLY FEES EMPLOYEE COMPUTER LOAN HOUSING PROJECT PROFESIONAL SERVICES-FILIPINO VILLAGE B. ESTES/CRYSTAL EAGLE ACHIEVEMENT AWARD PROFESSIONAL SERVICES-NHF EDUCATION URBAN CENTER/JUNE 2005 CDC ATTORNEY SALARY 12/15/04 & 12/23/04 VEHICLE MAINTENANCE 7/1/04-06/30/05 CUSTODIAL SERVICES/FEB. MAR. APR 2005 APPLICATION FOR MODIFICATION OF COSTAL PERMIT FY 3RD QTR ENTERPRISE ZONE SERVICES FY05 2ND QTR ENTERPRISE ZONE SERVICES OFFICE SUPPLIES BILLING PERIOD 11/05 THRU 3/31/05 BILLING PERIOD: 4/29/05 TO 05/27/05 PROF SERVICES-CLEVELAND & CUYAMACA/JUNE 2005 HIGHLAND AVE STREETSCAPE IMPROVEMENT 100 DWARF CITRUS TREES - HIGHLAND AVENUE TRANSPORTATION CHARGES EXPRESS SERVICES FENCING- HIGHLAND/EPSILON LOT MAINTENANCE PACIFIC STEEL SITE/MOSSY NISSAN-JUNE2005 ARE HOLDINGS BILLING THROUGH 5/31/05 PROJECT NATIONAL CITY/MAY 2005 SERVICES FOR MAY 2005 - H & A PROJECT SERVICES FOR JUNE 2005 NC BLVD 7TH TO 12TH ST. 6/1/05 - 6/30/05 AD FOR SR PROJECT MGR-REDEV MAY 2005-VARIOUS PROJECTS NC BLVD 7TH TO 12TH TITLE CHARGES TITLE CHARGES TONER CARTIDGES-HP 4100 (61X) COMPATIBLE WI CHIP TONER CARTRIDGES LEGAL SERVICES -MOSSY NISSAN/JUNE 2005 LEGAL SERVICES PAY-OFF OVERPAYMENT REFUND PACIFIC STEEL SURVEY 5/29 - 7/23/05 PROFESSIONAL SERVICES-3221 & 3225 NC BLVD PARKING/LUNCH REIMBUSEMENT DIGITAL BOND PRINTING SETTLEMENT AGREEMENT WEEK ENDING 6/24/05 THRU 7/1/05 WEEK ENDLNG 7/8/05 & 7/15/05 NC BLVD 7TH & 12TH/PERIOD ENDING 7/15/05 CATERING- SEPT 2. 2004 CONFERENCE REGISTRATION FOR BYRON ESTES MEMBERSHIP DUES REIMBURSEMENT - CALED ORG TEMPORARY SERVICES -WEEK -ENDED 6/24/05 GENERAL JUNE2005 PACIFIC STEEL SITE - JUNE2005 GENERALI.JULY 2005 BEAUCHAMP/JUNE 2005 GENERAL & MISC/JUNE 2005 Chk No Amount 15052 S198.26 15073 206.88 15074 150.00 15130 343.18 15035 32.31 15100 34.47 15001 1.892.54 15101 252.00 15055 10,850.00 15056 100.00 15004 3.456.00 15102 1,161.00 15005 47,650.47 15103 5,771.77 15104 7,500.00 15105 3,739.00 15059 34,454.00 15060 27,320.32 15075 521.61 15037 935.00 15076 6,597.62 15077 1,790.53 15028 18,455.78 15071 6,210.00 15078 102.26 15106 77.23 15006 365.00 15062 2.854.00 15107 8,387.50 15108 5.235.00 15079 6.381.52 15038 16,568.05 15080 7,573.33 15039 140.620.05 15081 293.76 15040 13.954.25 15109 1.593.00 15082 1,610.00 15110 750.00 15007 139.97 15083 145.30 15084 6.684.10 15111 502.50 15085 35.50 15086 6.630.77 15113 2.429.69 15008 34.52 15114 171.07 15070 50.000.00 15041 7,920.00 15115 9.672.00 15087 6.310.69 15116 700.00 15010 495.00 15042 435.00 15117 691.53 15012 255.00 15043 10.943.00 15088 7,273.80 15118 1.440.00 15089 1.851.25 Payee PAL ROBERT P & D CONSULTANTS. INC. PERISIC DESIGN STUDIO PETTY CASH - CDC PETTY CASH - CDC PIP PRINTING POWER PLUS REYES ARCHITECTS RODRIGUEZ, RAMONA ROSENOW SPEVACEK GROUP INC. SAFEGUARD BUSINESS SYS, INC. SAN DIEGO CLIPPING SERVICE SAN DIEGO CLIPPING SERVICE SAN DIEGO COUNTY RECORDER SAN DIEGO COUNTY RECORDER SAN DIEGO DAILY TRANSCRIPT SAN DIEGO NEIGHBORHOOD NEWS SAN DIEGO PRECAST CONCRETE INC SOUTHLAND SHREDDING STATE COMPENSATION INSURANCE STATE OF CALIFORNIA STEEL MAGNOLIA STUTZ, ARTIANO, SHINOFF & SWEETWATER AUTHORITY THE HOME DEPOT THE STAR NEWS TYLER WORKS UNION TRIBUNE UNITED STATES POSTAL SERVICE WESTERN CITY XEROX CORPORATION XEROX CORPORATION CDBG COMMUNITY YOUTH ATHLETICS OPERATION SAMAHAN TWO STEPS AHEAD TWO STEPS AHEAD NUTRITION AIRGAS - WEST AT SYSTEMS WEST. INC. CALIFORNIA BAKING CO. CALIFORNIA BAKING CO. CENTRAL MEAT & PROVISION CENTRAL MEAT & PROVISION CULLIGAN WATER JOSEPH WEBB FOODS MCGUIRE DISTRIBUTION MCGUIRE DISTRIBUTION MISSION UNIFORM SERVICE OFFICE SUPPI 1F.S PLUS PADRE JANITORIAL SUPPLIES, INC PADRE JANITORIAL SUPPLIES. INC QUILL CORPORATION SAN DIEGO GAS & ELECTRIC SBC/MCI SIERRA SPRINGS SLETTENGREN. INGRID SLETTENGREN, INGRID SYSCO SAN DIEGO FOR MEETING OF AUGUST 23, 2005 RATIFICATION OF EXPENDITURES FOR PERIOD: 07/27/05 • 08/12/05 Description LUNCH MEETING REIMBURSEMENT SERVICES FOR 5/28 • 7/1/05 STOREFRONT IMPROVEMENT PROGRAM PETTY CASH REPLENISHMENT PETTY CASH REPLENISHMENT 50 SETS OF DOWNTOWN PLAN AQUATIC CENTER SERVICES FOR APRIL 2005 PAY-OFF OVERPAYMENT REFUND REDEV PLAN EVAL & GEN IMPLEMENTATION SUPPLIES - CASH RECEIPT FORMS FOR REHAB LOANS MONTHLY FEES - JULY 2005 MONTHLY FEES - AUGUST 2005 RECORDING FEES FOR RECONVEYANCE RECORDING FEES FOR RECONVEYANCE PUBLICATIONS ADVERTISEMENT 50% PAYMNT FOR PLANTERS ON HIGHLAND AVE MONTHLY SERVICE FEE WORKERS' COMP/JUNE 2005 SDI 2ND QUARTER 2005 SPONSOR FOR 8TH FILIPINO FAMILY DAY PROFESSIONAL SERVICES THROUGHT 06/30/2005 UTILITIES-1820 G AVE PLANTING SOIL & OTHER MTLS FOR DWARF CITRUS TREES ADVERTISING HR & PAYROLL TRAINING 8/23-8/24/05 ADVERTISING POSTAGE FOR CDC POSTAGE METER SR PROJ MGR REDEV WEBSITE ADVERTISEMENT MONTHLY LEASE - JUNE 2005 MONTHLY LEASE - JULY 2005 SUBTOTAL - CDC: CDBG CLAIM REIMBURSEMENT FOR JUNE 2005 REIMBURSEMENT 2ND & 3RD QTR PROGRAM REIMBURSEMENT PROGRAM REIMBURSEMENT SUBTOTAL • CDBG MONTLY FEE FOR JUNE 2005 JULY 2005 FEES -NUTRITION CENTER FOOD -NUTRITION CENTER FOOD -NUTRITION CENTER FOOD -NUTRITION CENTER FOOD -NUTRITION CENTER RENTAL FEE 7/01-8/31/05 NUTRITION CENTER FOOD -NUTRITION CENTER FOOD -NUTRITION CENTER FOOD -NUTRITION CENTER UNIFORMS -NUTRITION CENTER OFFICE SUPPLIES/NUTRITION CENTER JANITORIAL SUPPLIES -NUTRITION CENTER SUPPLIES -NUTRITION CENTER MATERIALS & SUPPLIES -NUTRITION CENTER 1415 D AVE HM NC 6/17/05 - 7/19/05 PHONE/FAX CHGS-NUTRITION CENTER MONTHLY CHARGES -NUTRITION CENTER NUTRITION CENTER CATERING & OFFICE SUPLIES FOOD- NUTRITION CENTER Chk No 15014 15119 15120 15044 15090 15091 15092 15045 15093 15032 15046 15015 15121 15094 15095 15122 15016 15033 15096 15049 15018 15034 15124 15097 15072 15019 15126 15127 15021 15128 15099 15129 15027 15029 15020 15125 15053 15054 15002 15057 15003 15058 15061 15063 15009 15064 15065 15011 15013 15066 15031 15047 15048 15067 15017 15123 15050 Amount 92.93 2,953.75 6.666.27 107.10 175.16 260.22 785.00 15.517.50 52.72 16.553.15 141.03 52.92 54.20 251.00 162.00 1,205.55 2,377.33 24,189.87 90.00 6,323.23 2,895.14 750.00 185.60 40.60 1,980.16 453.56 225.00 4,365.90 1,000.00 283.50 999.40 661.71 S592,599.88 $2,500.00 23,597.44 4,620.24 84.00 $30,801.68 $18.90 437.72 283:85 578.65 3.454.60 3,321.34 140.50 12,098.22 897.05 702.55 468.65 177.78 2.843.08 1,379.93 110.68 2,388.24 57.79 57.60 141.36 203.63 9.628.61 Payee SYSCO SAN DIEGO SYSCO SAN DIEGO WILLIAMS. RAY 2004 TAX ALLOCATION BONDS BAKER & TAYLOR BAKER & TAYLOR BAKER & TAYLOR ENTERTAINMENT BRODART CO CITY COMFORTS INC. LAWTON PRINTING. INC. QUALITY BOOKS. INC HOUSING ASSISTANCE PAYMENTS CANO, ALICE CANO. ALICE CITY OF NATIONAL CITY EQUIFAX CREDIT INFORMATION SVS GMAC MORTGAGE HAPPY SOFTWARE. INC. NAN MCKAY AND ASSOCIATES, INC. NATIONAL CITY COLLABORATIVE SBC/MCI STATE COMPENSATION INSURANCE UNITED STATES POSTAL SERVICE XEROX CORPORATION PAYROLL FOR MEETING OF AUGUST 23, 2005 RATIFICATION OF EXPENDITURES FOR PERIOD: 07/27/05 - 08/12/05 Description FOOD -NUTRITION CENTER FOOD/CONS-NUTRITION CENTER REFRIGERATION REPAIR SUBTOTAL -NUTRITION: BOOKS -LIBRARY BOOKS -LIBRARY VIDEOS -LIBRARY BOOKS -LIBRARY PUBLICATIONS - 2 BOOKS RITE -ON BOOKS BLUE BOOKS -LIBRARY SUBTOTAL - 2004 TAX ALLOCATION BONDS: TOTAL - GENERAL FUND: AUGUST 2005 & MANUAL PAYMENTS MILEAGE REIMB FOR JULY 2005 MILEAGE REIMB FOR JUNE 2005 CDC ATTORNEY SAL 12/15/04 & 12/23/04 CREDIT REPORT FOR SECTION 8 APPLICANTS JUNE 2005 ELECTRICITY CHARGES HAPPY SUPPORT ADMIN PLAN REVISION SERVICES S8 HOUSING/FAM JUNE2005 S8 FAX LINE 6/12/05 - 7/12/05 WORKERS' COMP/JUNE 2005 POSTAGE FOR CDC POSTAGE METER S8 LEASE/JUNE 2005 TOTAL - SECTION 8: PPE 07/29/2005 TOTAL - ADMINISTRATIVE REVOLVING FUND: Chk No 15051 15068 15022 15023 15069 15024 15026 15036 15112 15030 Amount 170.88 1,512.75 548.71 $41,623.07 519.706.35 20,019.10 5.206.47 36,046.94 24.90 47.75 53.76 $81,105.27 S746,129.90 $617.505.10 10047 15.15 10042 15.15 10037 47,650.47 10046 50.00 10038 189.86 10039 4.355.00 10043 214.00 10040 4,233.33 10044 15.65 10045 1.135.49 10041 1.000.00 10048 1,404.81 $677,784.01 TOTAL OF ALL FUNDS: S1,513,161.66 COMMUNITY DEVELOPMENT COMMISSION Of THE CITY Of NATIONAL CITY August 23, 2005 AGENDA ITEM NO. 3 TO: CHAIRMAN AND BOARD MEMBERS FROM: BENJAMIN MARTINEZ, EXECUTIVE DIRECTOR VIA: BYRON ESTES, DEPUTY DIRECTOR OF REDEVELOPMENT SUBJECT: PUBLIC HEARING AND RESOLUTION NO. 2004-83: OF THE COMMUNITY DEVELOPMENT COMMISSION OF THE CITY OF NATIONAL CITY APPROVING THE HEALTH AND SAFETY CODE SECTION 33433 REPORT; APPROVING THE DISPOSITION AND DEVELOPMENT AGREEMENT BY AND BETWEEN THE COMMUNITY DEVELOPMENT COMMISSION AND MOSSY N4SSAN, INCORPORATED FOR DEVELOPMENT OF A NEW CAR DEALERSHIP LOCATED AT 2626 THROUGH 2700 NATIONAL CITY BOULEVARD; MAKING CERTAIN FINDINGS IN CONNECTION HEREWITH; AND AUTHORIZING THE TRANSMITTAL OF SAID REPORT TO THE CITY COUNCIL Recommendation: Community Development Commission staff recommends that the Community Development Commission Board: HOLD the Public Hearing of the Community Development Commission of if City of National City approving the Health and Safety Code Section 33433 Report; and, ADOPT Resolution No. 2005-83 approving the Disposition and Development Agreement by and between the Community Development Commission and Mossy Nissan, Incorporated for development of a new car dealership located at 2626 through 2700 National City Boulevard; make certain findings in connection herewith; and, AUTHORIZE the transmittal of said report to the City Council. Community Development Commission Agenda Item No. 3 August 23, 2005 Page 1 of 3 Public Notification: Pursuant to Section 33433 of the California Health & Safety Code, a Joint Public Hearing Notice was published in the Star News on August 5 and 12, 2005. fiscal Impact: Pursuant to Section 33433 of the California Health & Safety Code, a financial summary report has been prepared to evaluate the financial considerations under the terms of the proposed Disposition and Development Agreement, as well as the economic benefits of the proposed project to both the Community Development Commission and National City. A copy of the completed 33433 Financial Report has been attached for review. It is anticipated that $152,000 in increased real estate taxes will be generated per year to fund the following: • CDC: $115,447 • Affordable Housing: $30,400 • Office of Education: $3,220 ■ Southwestern College: $2,933 The project is expected to yield additional sales tax revenues of $300,000 annually to the City of National City. Environmental Impact: The project is consistent with the Certified EIR for the Redevelopment Plan for National City Redevelopment Project certified by Resolution No. 95-98 on June 20, 1995, for the National City General Plan and with the Zoning Designation of Automotive Commercial for the National City Mile of Cars and, consistent with Section 15180 of the California Environmental Quality Act Guidelines, does not require additional analysis. Property Description: The subject property is located at 2626 through 2700 National City Boulevard in the National City Mile of Cars. The site is comprised of two (2) parcels containing a total of approximately 4.53 acres. The San Diego County Assessor's Parcel Numbers for the subject property are 562-340-47 and 562-340-48. Project Description: Mossy Nissan, Incorporated proposes to develop a new Nissan Auto Dealership on the site of the existing Mossy Nissan Dealership in the National City Mile of Cars. The project will include the demolition of most of the existing structure and redevelopment of a $3 million new facility. Designs for the project will be finalized and submitted over the Planning Counter for review. Community Development Commission August 23, 2005 Agenda Item No. 3 Page 2 of 3 Financial Considerations of the Proposed DDA The fair market value of the subject property, according to the Community Development Commission's appraiser, is $7 Million ($7,000,000). The price to be paid to the Community Development Commission for the property by Mossy Nissan, Incorporated shall be: (1) in the event the property is acquired by the Community Development Commission through a negotiated purchase, the actual price paid by the Community Development Commission for the property, plus any other acquisition costs incurred to that date, or (2) in the event the property is acquired by the Community Development Commission through eminent domain proceedings, the amount of just compensation awarded to the owner of the property, plus the amount of acquisition costs incurred by the Community Development Commission. Economic Benefits; Health and Safety Code Section 33433 Report On August 8, 2005, the CDC's redevelopment financial consultant (KMA) completed a financial summary report, pursuant to Section 33433 of the California Health & Safety Code. The purpose of this report is to evaluate the financial considerations in order to determine economic benefits of the CDC's participation in this proposed DDA. A copy of this 33433 Financial Summary Report is attached for your review. It is anticipated that $152,000 in increased real estate taxes will be generated per year to fund the following: • CDC: $115,447 • Affordable Housing: $30,400 • Office of Education: $3,220 • Southwestern College: $2,933 The project is expected to yield additional sales tax revenues of $300,000 annually to the City of National City. Conclusion: With this, Staff recommends that the Community Development Commission Board approve the Health and Safety Code Section 33433 Report; adopt Resolution No. 2005- 83 approving the Disposition and Development Agreement by and between the Community Development Commission and Mossy Nissan, Incorporated for development of a new car dealership located at 2626 through 2700 National City Boulevard; make certain findings in connection herewith; and authorize the transmittal of said report to the City Council. ATTACHMENTS: Exhibit 1 - Resolution No. 2005-83 Exhibit 2 - 33433 Financial Summary Report Exhibit 3 - Joint Public Hearing Notice Exhibit 4 - Proposed Disposition and Development Agreement Staff member: Beard Community Development Commission Agenda Item No. 3 August 23, 2005 Page 3 of 3 RESOLUTION NO. 2005-83 A RESOLUTION OF THE COMMUNITY DEVELOPMENT COMMISSION OF THE CITY OF NATIONAL CITY APPROVING THE HEALTH AND SAFETY CODE SECTION 33433 REPORT, APPROVING THE DISPOSITION AND DEVELOPMENT AGREEMENT BY AND BETWEEN THE COMMUNITY DEVELOPMENT COMMISSION AND MOSSY NISSAN, INCORPORATED, AND MAKING CERTAIN FINDINGS IN CONNECTION THEREWITH WHEREAS, the Community Development Commission of National City ("CDC") is a public body, corporate and politic, organized and existing under the California Community Redevelopment Law {Health & Safety Code Section 33000 et seq.); and, WHEREAS, on June 20, 1995, pursuant to Resolution No. 95-98, the City Council of the City of National City {the "City" or "City Council") certified the completion of a final Environmental Impact Report ("EIR") for the Redevelopment Plan for the National City Redevelopment Project; and, WHEREAS, pursuant to the Community Redevelopment Law, on July 18, 1995, pursuant to Ordinance No. 95-2095 the City Council approved and adopted the Redevelopment Plan for the National City Redevelopment Project; and, WHEREAS, the Community Development Commission of the City of National City (the "CDC") is engaged in activities necessary to execute and implement the Redevelopment Plan (the "Redevelopment Plan") for the National City Redevelopment Project (the "Redevelopment Project"); and, WHEREAS, the Implementation Plan adopted by the CDC with respect to the Redevelopment Project Area calls for the CDC's objective to "increase private investment wherever possible, to promote jobs, and improve the property and sales tax base of the City"; and, WHEREAS, in furtherance of the objectives of the Community Redevelopment Law, the CDC desires the redevelopment of certain real property within the Redevelopment Project Area, located at 2626 through 2700 National City Boulevard, for a new car dealership; and, WHEREAS, the development contemplated is consistent with the EIR for the Redevelopment Plan for the National City Redevelopment Project, and therefore is exempt from further California Environmental Quality Act ("CEQA") review under Section 15180 of the CEQA Guidelines; and, WHEREAS, the Dailey Family Partnership owns in fee the real property commonly known as 2626 through 2700 National City Boulevard (the "Site"); and, EXHIBIT I WHEREAS, Mossy Nissan, Inc., a California corporation ("Mossy"), is currently the lessee of the Site and desires to purchase the Site in order to construct a new car dealership; and, WHEREAS, CDC staff has negotiated a Disposition and Development Agreement including attachments thereto (collectively, the "DDA") with Mossy for the CDC's disposition of the Site to Mossy, if necessary, and subject to the discretion of the CDC; and, WHEREAS, pursuant to the terms of the DDA, Mossy shall construct a $3 Million ($3,000,000) new car dealership on the Site; and, WHEREAS, CDC staff has presented the draft DDA to the CDC Board and City Council for consideration; and, WHEREAS, the Community Redevelopment Law, at Health and Safety Code Section 33433, requires that (i) the CDC prepare a Summary Report concerning the CDC's proposed disposition of the Site as set forth in the DDA, (ii) the CDC Board and the City Council conduct a noticed joint public hearing with respect to the DDA, and (iii) the approval of the DDA be set forth in a resolution making certain findings and determinations as set forth herein below; and, WHEREAS, pursuant to the requirements of Section 33433 of the Community Redevelopment Law, a Summary Report for the DDA has been prepared by the CDC's economic consultant Keyser Marston Associates, Inc.; and, WHEREAS, a joint public hearing of the CDC Board and City Council has been noticed and conducted in accordance with applicable requirements of law; and, WHEREAS, at the joint public hearing the CDC and the City Council each considered all of the information, testimony, and evidence presented, including but not limited to the draft DDA, in the form presented by CDC staff concurrent with consideration of the Resolution, the CDC staff report, the Summary Report, and the oral and written testimony received from persons wishing to appear and be heard concerning the proposed DDA. NOW, THEREFORE, THE CITY COUNCIL OF NATIONAL CITY HEREBY RESOLVES AS FOLLOWS: 1. Based on all the information, testimony, and evidence presented at the joint public hearing, including but not limited to the draft DDA and the information and evidence set forth in the CDC staff report, the Summary Report, and the oral and written testimony received, the City Council finds and determines as follows: herein. a. That the above Recitals are true and correct and are incorporated 2 b. That the DDA effectuates the purposes of the Community Redevelopment Law (Health & Safety Code Section 33000 et seq.), and of the Redevelopment Plan, and is in the best interests of the citizens of National City. c. That the CDC's disposition of the Site pursuant to the DDA will assist in the elimination of blight. d. That the CDC's disposition of the Site pursuant to the DDA is consistent with the Redevelopment Plan and the National City General Plan. e. That the DDA is consistent with the Implementation Plan for the Redevelopment Plan. f. That any consideration Mossy will pay for the Site is not less than the fair market value or the fair reuse value of the Site at the use and with the covenants and conditions and development costs authorized by the disposition. 2. The DDA, a true and correct copy of which is on file with the City Clerk/CDC Secretary, is hereby approved. 3. The City Council consents to (i) the authorization and direction given by the CDC to its Executive Director and CDC Counsel to make final modifications to the DDA that are consistent with the substantive terms of the DDA approved hereby, (ii) the authorization and direction given to the CDC Chairperson to thereafter sign the DDA on behalf of the CDC, and (iii) the authorization and direction given by the CDC to their Executive Director to take such other and further actions as may be necessary and proper to carry out the terms of the DDA and the purpose of this Resolution, including but not limited to signing such other and further documents, including the documents attached as exhibits to the DDA. 4. The Executive Director of the CDC is directed to file a Notice of Exemption with the County Clerk confirming the project is exempt from further CEQA review. 5. That the Executive Director is hereby directed to transmit the Summary Report for the Disposition and Development Agreement to the City Council, as required by Health and Safety Code Section 33433. // // // // // // 3 // // PASSED AND ADOPTED this 23`d day of August 2005. ATTEST: Ben Martinez, Secretary APPROVED AS TO FORM: George H. Eiser, III, Legal Counsel Nick Inzunza, Chairman 4 SUMMARY REPORT PERTAINING TO THE SALE OF REAL PROPERTY (California Community Redevelopment Law 33433) PURSUANT TO A PROPOSED DISPOSITION AND DEVELOPMENT AGREEMENT Between: COMMUNITY DEVELOPMENT COMMISSION Of THE CITY OF NATIONAL CITY And: MOSSY NISSAN, INC. Prepared by: KEYSER MARSTON ASSOCIATES, INC. For. COMMUNITY DEVELOPMENT COMMISSION OF THE CITY OF NATIONAL CITY Date: August 8, 2005 EXHIBIT 2 SUMMARY REPORT PERTAINING TO THE PROPOSED SALE OF REAL PROP-ERTY I. INTRODUCTION The Community Development Commission of the City of National City (Commission) is considering the acquisition and sale of real property to Mossy Nissan, Inc. (Developer) pursuant to a Disposition and Development Agreement (DDA) under review as of August 1, 2005. This Summary Report is prepared in accordance with Section 33433 of the California Community Redevelopment Law. This summary consists of six additional sections, as follows: • Section II, Description of the Proposed Project • Section 111, Estimated Costs to be Incurred by the Commission under the Proposed DDA • Section IV; Estimated Fair Re -Use Value of the Interest to be Conveyed • Section V, Estimated Value of the Site at the Highest and Best Use • Section VI, Purchase Price the Developer w ill be Required to Pay • Section VII, Explanation Why the Sale of the Property will Assist in Elimination of Blight Summary Report Mossy Nissan, Inc. 7611)9.002.035 05 373mm August 8, 2006 Page 2 II. DESCRIPTION OF THE PROPOSED PROJECT A. Proposed Transaction The Developer intends to remodel the existing Nissan dealership located at 2626 to 2700 National City Boulevard. The dealership is situated on a 4.53-acre site (Site), which is being teased to the Developer by the current property owner. It is KMA's understanding that the current lease has 2.5 years remaining with one five year renewal option at market rent, but the Developer does not intend to exercise the option. The Site is improved with four buildings comprising approximately 43,000 square feet (Sr), which includes a showroom, office space, and service bays. The Site is bounded by National City Boulevard, Transportation Avenue, and 26'" and 28th Streets in National City. Specifically, the Site is located on the City's main retail thoroughfare, National City Boulevard, and is rectangular in shape, essentially flat, and at grade with the frontage roads. A major part of this arterial street has been designated and zoned as an automobile park known as the "Mile of -Cars*. Although the area is exclusively zoned for new automobile dealerships, some pre-existing non -automotive retail uses remain. The proposed transaction is detailed in the Disposition and Development Agreement (DDA) under review as of August 1, 20o5. The DDA governs the relationship between the Commission and the Developer with respect to the proposed development of the Site, the schedule of performance, and the method of financing. Key terms of the ODA are summarized below. 9. Agency and Develo per Responsibilities • The Developer wifl attempt to acquire the Site thro ugh private negotiation w ith the property owner. • If the Developer is unsuccessf ul in acquiring the Site, the Commission in its absolute and sole discretion can de cide to initiate eminent domain proceedings. Upon acquisition of the Site, the Com mission will -convey fee ownership of the Site to the Developer at a price equ al to the price paid by the Commission to acquire the Site. • If the Commission decides to use its power of eminent domain, the Developer will advance to the Commission the Possession Deposit. • The Developer will pay a Purchase Price to the Commission in the amount of: (a) the actual price negotiated by the Commission for acquisition of the Site, plus any Summary Report Mossy Nissan, Inc. i 5104.002.035 05373mm August 8, 2005 Page 3 other acquisition costs incurred by the Commission; or (b) the amount of just compensation awarded to the current property owner, plus the amount of acquisition costs incurred by Commission, such as completion of the eminent domain proceedings, and the amount necessary to satisfy any judgment in the action. • If the condemnation action is greater than $8 million, the Commission will attempt to abandon condemnation proceedings at the option of the Developer. • It is the belief and understanding of the Commission and the Developer that the DDA between the parties does not involve a "public work° as defined by the State prevailing wage laws, since the Developer will purchase the Site from the Commission for its fair market value without public subsidy. • The Developer agrees to devote the Site to the sale of new automobiles and trucks as a factory -authorized new automobile dealer as the principal activity conducted on the Site for a minimum of 10 years. Summary Report Mossy Nissan, Inc. 16104.002.035 05373mm August 8, 2005 Page 4 Ill. ESTIMATED COST TO BE INCURRED BY THE COMMISSION UNDER THE PROPOSED AGREEMENT Costs to the Commission related directly to development of the Site are itemized below. They consist of the following: (1) Commission Costs Site Acquisition (Estimate) $7,000,000 Other Agency Acquisition Costs TBD DDA Costs (Legal, Economic, and Appraisal) (2) $25.000 Total Commission Costs $7,025,000 (Less) Purchase Price from Developer (not Tess than Site Acquisition Cost) ($7,000,000) (Less) Reimbursement to Commission for Other Commission Acquisition Costs (TBD) (Less) Reimbursement from Developer for Commission DDA Costs t$25.000) Net Commission Costs $0 (1) AI! figures provided by the Community Development Commission of National City, except as noted. (2) Gross estimate. Summary Report Mossy Nissan, Inc. let°,4.002.035 05373mrn August 8, 2065 Page 5 IV. ESTIMATED FAIR RE -USE VALUE OF THE INTEREST TO BE CONVEYED This section presents an analysis of the fair re -use value of the interest to be conveyed to the Developer. Re- use value is defined as the highest price in terms of cash or its equivalent which a property or development right is expected to bring for a specified use in a competitive open market, subject to the covenants, conditions, and restrictions imposed by the DDA. The proposed DDA sets specific conditions with respect to the scope of development, the schedule of performance, and method of financing. The Commission contracted with John G. Slagle, MAI, of Real Estate Professionals to conduct an appraisal of the Site. The appraiser determined the fair market value of the fee simple interest of the Site "As is" as of April 30, 2005. The appraiser concluded that the fair market value for the Site is $7,000,000, or approximately $33 per SF. On this basis, then, KMA concludes that the fair re -use value of the Site is estimated to be $7,000,000, or $33 per SF land. Summary Report Mossy Nissan, Inc. 16704.002.035 05373mm August 8, 2005 Page 6 V. ESTIMATED VALUE OF THE SITE AT THE HIGHEST AND BEST USE This section presents an analysis of the fair market value of the Site at its highest and best use. In appraisal terminology, the highest and best use is that use of the property that generates the highest property value and is physically possible, financially feasible, and legally permitted. Therefore, value at the highest and best use is based solely on the value created and not on whether or not that use carries out the redevelopment goals of the City of National City. The Redevelopment Plan of the City of National City governs the Site and reguiatesthe zoning and land uses for the Site. The Site is zoned for commercial automotive within a planned development overlay (CA-PD). The zoning strictly allows only for new car dealerships. On this basis, then, KMA concludes that the proposed use represents the highest and best use of the Site. Therefore, the fair market value at highest and best -use is equal to the fair re -use value, or $7,000,000, or $33 per Sf land. Summary Report Mossy Nissan, Inc. 161,04.002.035 05373mm August 6, 2005 Page 7 VI. PURCHASE PRICE WHICH THE DEVELOPER WILL BE REQUIRED TO PAY Under California Community Redevelopment Law, the Commission is obligated to publicly disclose information sufficient for a comparison of the purchase price contained in the proposed DDA with the estimated fair re -use value as described below. On this basis, then, MIA concludes that the effective compensation to the Commission is $7,000,000. Summary Report Mossy Nissan, Inc. 16104.002.035 05373mm August 5 2005 Page 8 VII. EXPLANATION WHY SALE OF THE PROPERTY WILL ASSIST IN TI4E ELIMINATION OF BLIGHT The Project Area is characterized by an array of blighting factors, including: • The age, obsolescence, deterioration, mixed character, or shifting uses of existing buildings within the Project Area. • The subdividing and sale of lots of irregular form and shape, and inadequate size; #or proper usefulness and development. • A prevalence of depreciated values and im paired investments, and social and economic maladjustment. • The defective design in character or physical condition of existing buildings. Not all of these conditions are present throughout the Project Area. TheOommission's redevelopment efforts have successfully alleviated blighting conditions in some portions of the Project Area. Implementation of the proposed development can be expected to assist in the alleviation of blighting conditions through the following: •, Consolidation of irregular parcels into a site appropriate for development. • Elimination of conditions of economic dislocation such as fragmented ownership patterns. • Expansion, renovation, and relocation of businesses within the Project Area. Summary Report Mossy Nissan, Inc. 16104.002.035 05373mm August 8, 2005 Page Current List of Developers Proposing Projects in the Downtown Specific Plan Area Urban Development Group Sherm Harmer, Managing Principal 1901 lst Avenue, Suite 410 San Diego, CA 92101 619-843-9749 voice 619-544-8988 fax sdhir@pacbell.net Lennar Communities Damon Braden, Manager of Urban Development 1525 Faraday Avenue, Suite 300 Carlsbad, CA 92008-7319 760-918-7765 voice 760-918-8868 fax dbraden@lennarfamily.com Shea Homes Michael Brekka, Vice President 10721 Treena Street, Suite 100 San Diego, CA 92131 858-653-4114 voice 858-635-5436 fax Michael.brekka@sheahomes.com Pacifica Companies Dan Fissori 1785 Hancock Street, Suite 100 San Diego, CA 92110 619-296-9000 x118 voice 619-296-9090 fax dan@pacificahost.com A.R.E. Holdings Sam Ynzunza 12626 Bellflower Blvd., PMB-128 Downey, CA 90242 213-944-4677 voice 562-925-9881 fax spynzunza@aol.com NOTICE OF A JOINT PUBLIC HEARING OF THE CITY COUNCIL OF THE CITY OF NATIONAL CITY AND TILE COMMUNITY DEVELOPMENT COMMISSION ON THE PROPOSED MOSSY NISSAN PROJECT The City Council of the City of National City and the National City Community Development Commission (CDC) will hold a Joint Public Hearing after the hour of 6:00 p.m. Tuesday, August 23, 2005, in the City Council Chambers, Civic Center, 1243 National City Boulevard, National City, on the proposed Disposition & Development Agreement (DDA) and Owner Participation Agreement for the proposed Mossy Nissan project. Any person interested in this matter may appear at the above time and place and be heard. Mossy Nissan, Inc., is proposing the development of a new automobile dealership on 4.53 acres located at 2626 and 2700 National City Boulevard within the National City Mile of Cars. The dealership will be constructed to accommodate anticipated increased sales volume forecasts of Nissan Motors for the next five years and beyond. The purpose of the Joint Public Hearing is to provide for public comment, in accordance with Sections 33433 and 33445 of the California Health & Safety Code, regarding the proposed terms and conditions for the sale of land proposed in a Disposition & Development Agreement (DDA) by and between the CDC and Mossy Nissan, Inc., for the real property located at 2626 and 2700 National City Boulevard. Said land is proposed to be sold for the development of. the Mossy Nissan project. A copy of the proposed DDA, a summary report pertaining to the sale of real property pursuant to the proposed Agreement, and other documentation required by Section 33445 of the California Health & Safety Code for the proposed Mossy Nissan project may be reviewed at the office of the Community Development Commission. at 140 East 12th Street, Suite B, National City, and the City Clerk's Office, 1243 National City Blvd., National City as of August 9, 2005. Members of the public are invited to continent. Written comments should be received by the Community Development Commission on or before 3:00 p.m., August 17, 2005. Any questions regarding this matter should be directed to Patricia Beard at (619) 336-4250. If you challenge the nature of the proposed action in court, you may be limited to raising only those issues you or someone else raised at the public hearing described in this notice, or in written correspondence delivered to the public hearing entity conducting the hearing at, or prior to, the public hearing. MICHAEL DALLA City Clerk PUBLISHED IN THE NATIONAL CITY STAR NEWS, Friday, August 5 and August 12, 2005 EXHIBIT 3 DISPOSITION AND DEVELOPMENT AGREEMENT By and Between the COMMUNITY DEVELOPMENT COMMJSSION OF THE CITY OF NATIONAL CITY and MOSSY NISSAN, INC. 017252230.5 EXHIBIT 4 Attachment No. 1 Attachment No. 2 Attachment No. 3 Attachment No. 4 Attachment No. 5 Attachment No. 6 Attachment No. 7 Site Map Site Legal Description Grant Deed Schedule of Performance Scope of Development Release of Construction Covenants Operating Covenant 017.262230.5 DISPOSITION AND DEVELOPMENT AGREEMENT THIS DISPOSITION AND DEVELOPMENT AGREEMENT (this "Agreement") is entered into as of August 23, 2005, by and between the COMMUNITY DEVELOPMENT COMMISSION OF THE CITY OF NATIONAL CITY, a public body, corporate and politic (the "CDC"), on the one hand, and MOSSY NISSAN, INC., a California corporation (the "Developer") on the other. RECITALS The following recitals are a substantive part of this Agreement: A. In furtherance of the objectives of the California Community Redevelopment Law, the CDC desires to redevelop a certain approximately 4.53 acre portion of the National City Redevelopment Project (the "Redevelopment Project") located at 2626 and 2700 National City Boulevard (APNs 562-340-47 and -48) (the "Property" or the "Site", more fully described below) in the City of National City (the "City"). B. The CDC and Developer desire by this Agreement for the Developer to redevelop and remodel upon the Property a new automobile sales, service and repair facility (the "Project"). C. The CDC and Developer (singularly, a "Party"; jointly the "Parties") desire to cause the Property to be redeveloped in order to aid in alleviating blighted conditions and to stimulate economic development in the Redevelopment Project area. D. In order to accomplish the successful completion of the Project, subject to the terms and conditions of this Agreement, the Agency may acquire the Property and convey the Property to Developer in order to enable Developer to construct the Project. E. The completion of the Project is in the vital and best interest of the City and the health, safety, morals and welfare of its residents, and in accord with the public purposes and provisions of applicable state and local laws and requirements under which the redevelopment of the Redevelopment Project has been undertaken. NOW, THEREFORE, the CDC and the Developer agree as follows: 100. DEFINITIONS "Acquisition Costs" is defined in Section 203. "Agreement" means this Disposition and Development Agreement between the CDC and the Developer. "Attachments" to this Agreement are integral parts of the Agreement and are as enforceable as if set forth in the body of the Agreement. 017.262230.5 "Basic Concept Drawings" means the initial drawings for the Project showing site plans, elevations and landscape features for the Project that have been submitted by the Developer and approved by the CDC concurrently with the approval of this Agreement. "CDC" or "Agency" means the Community Development Commission of The City of National City, a public body, corporate and politic, exercising governmental functions and powers and organized and existing under Chapter 2 of the Community Redevelopment Law of the State of California, Health and Safety Code, Section 33000, et seq., and any assignee of or successor to its rights, powers and responsibilities. "CDC's Conditions Precedent" means the conditions precedent to the Closing for the benefit of the CDC, as set forth in Section 208.1 hereof. "City" means the City of City of National City, a California municipal corporation. "Closing" means the close of Escrow for the Conveyance of the Property from the CDC to the Developer, as set forth in Section 205.4 hereof. "Closing Date" means the date of the Closing, as set forth in Section 205.4 hereof. "Condition of Title" is defined in Section 206 hereof. "Construction Drawings" means the detailed construction drawings and plans to be prepared with respect to the Improvements, as set forth in Section 302.2 hereof. "Conveyance" means the conveyance of the Property by the CDC to the Developer on the Closing Date. "Date of Agreement" means the date set forth in the first paragraph hereof. "Default" means the failure of a party to perform any action or covenant required by this Agreement within the time periods provided herein following notice and opportunity to cure, as set forth in Section 501 hereof. "Developer" means Mossy Nissan, Inc., a California corporation or its assignee pursuant to Section 603.1. "Developer's Conditions Precedent" means the conditions precedent to the Closing for the benefit of the Developer, as set forth in Section 208.2. "Developer Deposits" is defined in Section 202 hereof. "Enforced Delay" is defined in Section 602. "Environmental Laws" means shall mean any and all federal, state and local statutes, ordinances, orders, rules, regulations, guidance documents, judgments, governmental authorizations, or any other requirements of governmental authorities presently relating to the release, generation, use, handling, treatment, storage, transportation or disposal of Hazardous 2 017.262230.5 Materials, or the protection of the environment or human, plant or animal health. "Environmental Laws" include, without limitation, (i) the Comprehensive Environmental Response, Compensation, and Liability Act (42 U.S.C. § 9601 et seq.), (ii) the Hazardous Materials Transportation Act (94 U.S.C. § 1801 et seq.), (iii) the Resource Conservation and Recovery Act (42 U.S.C. § 6901 et seq.), (iv) the Federal Water Pollution Control Act (33 U.S.C. § 1251 et seq.), (v) the Clean Air Act (42 U.S.C. § 7401 et seq.), (vi) the Toxic Substances Control Act (15 U.S.C. § 2601 et seq.), (vii) the Oil Pollution Act (33 U.S.C. § 2701 et seq.), (viii) the Emergency Planning and Community Right -To -Know Act (U.S.C. § 11001 et seq.), (ix) the Porter -Cologne Water Quality Control Act (Cal. Water Code § 13020 et seq.), (x) the Safe Drinking Water and Toxic Enforcement Act of 1986 (Cal. Health & Safety Code § 25300 et seq.), (xi) the Hazardous Waste Control Act (Cal. Health & Safety Code § 25100 et seq.), (xii) the Carpenter -Presley -Tanner Hazardous Substance Account Act (Cal. Health and Safety Code § 25316 et seq.), (xiii) the Hazardous Materials Release Response Plans and Inventory (Cal. Health & Safety Code § 25501 et seq.), (xiv) Cal. Health and Safety Code § 25281 (Underground Storage of Hazardous Substances), (xv) Article 9 or Article 11 of Title 22 of the California Administrative Code, Division 4, Chapter 20, and other applicable provisions of the California Health and Safety Code, Water Code, and Government Code as amended or supplemented and any analogous present federal, state or local statutes, ordinances or laws, and any regulations promulgated pursuant to any of the foregoing. "Escrow" is defined in Section 205 hereof. "Escrow Costs" is defined in Section 205.1 hereof. "Escrow Holder" is defined in Section 205 hereof. "Governmental Requirements" means all laws, ordinances, statutes, codes, rules, regulations, orders and decrees of the United States, the State of California, the County of San Diego, the City, or any other political subdivision in which the Property is located, and of any other political subdivision, CDC or instrumentality exercising jurisdiction over the CDC, the Developer or the Property. "Grant Deed" means the grant deed for the conveyance of the Property from the CDC to the Developer, in the form of Attachment No. 3 hereto which is incorporated herein by reference. "Hazardous Materials"means any substance, material, or waste which is or becomes, regulated by any local governmental authority, the State of California, or the United States Government, including, but not limited to, any material or substance which is (i) defined as a "hazardous substance," "hazardous waste," "extremely hazardous waste," or "restricted hazardous waste" under Environmental Laws, (ii) petroleum, (iii) friable asbestos, (iv) polychlorinated byphenyls, (v) methyl tertiary butyl ether, or (vi) any other substance, whether in the form of a solid, liquid, gas or any other form whatsoever, which by any Governmental Requirements either requires special handling in its use, transportation, generation, collection, storage, handling, treatment or disposal, or is defined as "hazardous" or harmful to human health or the environment. 3 017.262239.5 "Improvements" means the improvements to be constructed by the Developer upon the Property, all more particularly described in Section 301.1 hereof and in the Scope of Development. "Notice" means a notice in the form prescribed by Section 601 hereof. "Operating Covenant" means the Operating Covenant in the form of Attachment No. 7 hereto which is incorporated herein by reference. "Outside Date" means the last date the Closing shall occur, as set forth in Section 205.4 hereof. "Parties" means the CDC and the Developer. "Permitted Exceptions" means the following exceptions to title with respect to the Property: (1) applicable building and zoning laws and regulations; (2) the provisions of this Agreement; (3) the Operating Covenant; (4) any lien for current taxes or taxes accrued subsequent to Closing; (5) such other conditions, covenants, restrictions or easements of record as may be expressly approved by the Developer in writing; and (6) the liens, encumbrances, conditions and other matters set forth in the Report approved by Developer pursuant to Section 206. "Possession Deposit" is defined in Section 202. "Project" means the Property and the Improvements. "Property" or "Site" means the approximately 4.53 acre portion of the Redevelopment Project located at 2626 and 2700 National City Boulevard in the City, which is legally described in the Property Legal Description and depicted on the Site Map. "Property Legal Description" means the legal description of the Property in Attachment No. 2. "Purchase Price" means the price to be paid by the Developer to the CDC in consideration for the Conveyance of fee title to the Property, as set forth in Section 204.2 hereof. "Redevelopment Plan" means the Redevelopment Plan for the Redevelopment Project, adopted by Ordinance No. 95 - 2095 of the City Council of the City of National City, and incorporated herein by reference. 4 017262230.5 "Redevelopment Project" means the National City Redevelopment Project, adopted by the City pursuant to the Redevelopment Plan. "Release of Construction Covenants" means the document, which evidences the Developer's satisfactory completion of the Improvements, as set forth in Section 309 hereof, in the form of Attachment No. 6 hereto which is incorporated herein. "Report"means the preliminary title report, as described in Section 206 hereof. "Schedule of Performance" means the Schedule of Performance in Attachment No. 4, setting out the dates and/or time periods by which certain obligations set forth in this Agreement must be accomplished. The Schedule of Performance is subject to revision from time to time as mutually agreed upon in writing between the Developer and the CDC's Director. Unless otherwise specified herein, the CDC's Director is authorized to make such revisions, as he or she deems reasonably necessary. "Scope of Development" means the Scope of Development in Attachment No. 5, that describes the scope, amount and quality of development of the Improvements to be constructed by the Developer pursuant to the terms and conditions of this Agreement. "Site Map" means the depiction of the Property in Attachment No. 1. "Title Company" is defined in Section 206 hereof. "Title Policy" is defined in Section 207 hereof. "Transfer" is defined in Section 603 hereof. "Triple Net Lease" is defined in Section 203.3 hereof. 200. ACQUISITION AND CONVEYANCE OF THE SITE 201. Developer Efforts to Acquire Property. The Developer has atteiiipted to acquire the Property. During the time after Developer executes this Agreement and the time at which the CDC may approve this Agreement, the Developer shall continue to negotiate for the acquisition of the Property in good faith with the owners of the Property. CDC will reasonably determine that Developer has made such good faith efforts to acquire the Property. Developer, to the extent its negotiations are unsuccessful with respect to the acquisition of the Property, desires CDC to assist in the acquisition of the Property and to consider the possible use of its eminent domain powers. Should the CDC acquire the Property, Developer desires the CDC to transfer the Property to it. In connection with any such acquisition, CDC shall determine in good faith and within its sole, absolute and independent discretion, whether it will or will not adopt a resolution of necessity and proceed with eminent domain. Developer acknowledges and agrees that the CDC has not pre -committed itself to commencement of eminent domain proceedings with respect to the Property and the CDC reserves the right, in its sole and absolute discretion, to approve or disapprove a resolution of necessity in connection therewith. Unless and until CDC decides to utilize its power of eminent domain as provided in Section 202, this Agreement does 5 017.262230.5 not bind the CDC to exercise its power of eminent domain, and CDC's failure to exercise said power shall not constitute a default by CDC hereunder. 202. Acquisition by Eminent Domain. if the CDC in its absolute and sole discretion decides, following appropriate hearings and evidence presented, to utilize its eminent domain power for the acquisition of the Property, provided Developer is timely making all Developer Deposits and paying all Acquisition Costs as set forth below in this Agreement, CDC will use its best efforts and diligently follow the Eminent Domain Law of the State of California and not voluntarily terminate or stop such proceeding. Developer shall be responsible for and shall advance to CDC, from time to time, upon written request of the CDC, all sums necessary for the completion of such proceedings (the "Developer Deposits"), including, without limitation, all Acquisition Costs, including, but not limited to, court costs, deposits necessary to obtain orders for pre judgment possession (the "Possession Deposit"), the amount of just compensation set forth in any final judgment of condemnation, payments for loss of business goodwill or pre - condemnation damages, relocation expenses and costs, any interest awarded by the court to the Property owner (net of any interest received by the CDC on the Possession Deposit, if any), title and litigation guarantees and any and all associated costs. The CDC shall use (again assuming it has decided after full and fair hearings to proceed with the acquisition) its best efforts to pro rate taxes, assessments, and other charges applicable to the Property as of the date of CDC's acquisition. Any advances requested by CDC shall be tendered by Developer by wire transfer or cashiers check within five (5) business days of receipt of CDC's written demand. 203. Acquisition Costs. For the purposes of this Agreement the term "Acquisition Costs" shall refer to any and all costs and expenses set forth in Section 202 above (whether previously advanced by Developer or not) as well as all other costs and expenses contemplated as being the responsibility of the Developer under this Agreement. Acquisitions Costs shall also include any and all costs and expenses of CDC in acquiring or attempting to acquire the Property through a negotiated purchase and enforcing its right to require Developer Deposits and supplements thereto pursuant to Section 202 above and this Section 203. In the event of termination of this Agreement at any time for any reason other than CDC's Default, Developer's obligation to pay Acquisition Costs shall survive the termination of this Agreement with respect to all Acquisition Costs (collectively, the "Post Termination Costs") either: (i) paid or incurred but not yet billed or paid as of such termination, or (ii) arising from (a) the subsequent abandonment of any eminent domain action as provided in Section 203.2, including, without limitation, any litigation expenses for which CDC may be responsible under California Code of Civil Procedure Section 1268.610 and/or damages under Section 1268.620 (including, but not limited to attorneys fees) and (b) any claims, actions, or other causes arising out of or related to actions taken by CDC prior to such termination. Developer hereby agrees to indemnify, defend and hold harmless the CDC, its elected officials, officers, employees and agents from and against any and all claims, losses, liabilities, costs, expenses (including reasonable attorneys' fees), actions, causes of action, penalties or interest arising out of or in connection with any third party objections to CDC efforts to acquire the Property through a negotiated purchase or exercise of its power of eminent domain, including, without limitation, the adoption of any resolution of necessity or the filing of any complaint in eminent domain. If an eminent domain action is commenced, abandonment thereof sought, but the judge in such action for any reason does not allow the abandonment of the action, Developer shall be obligated to pay all awards, damages, costs and expenses awarded to the property owner in such action as "Acquisition Costs". 6 017.262239.5 Developer shall deliver to CDC all Acquisition Costs (not previously advanced by Developer) and all Post Termination Costs within thirty (30) days after written demand from the CDC. Subject to the indemnification provisions above, CDC shall bear all costs incurred by CDC regarding the Property and this Agreement up to the date hereof. In carrying out its rights and obligations pursuant to this Agreement, CDC is authorized to select and hire those consultants, appraisers, expert witnesses, legal counsel, and other professionals as CDC deems necessary to effectuate and complete its rights and obligations hereunder and under the law of the State of California. Reasonable costs incurred by CDC for such consultants, appraisers, expert witnesses, legal counsel and other professionals shall be considered part of the Acquisition Costs. The payment of such amounts by Developer to CDC for any of these costs shall be effected within thirty (30) days of the date of mailing of such invoice and/or billing. 203.1 Possession Deposit. Notwithstanding anything set forth in Section 202 above, Developer and CDC understand and agree that Developer may not be in a position to make the Possession Deposit in which event it will not be possible to secure an order of possession in any eminent domain action prior to the entry of a judgment in any such action. Accordingly, in the event CDC decides to utilize its power of eminent domain, CDC shall not file a complaint for eminent domain for the Property until Developer advises CDC that it elects to have CDC seek an order of possession prior to the entry of judgment in any such action. Developer shall make such election no later than the last date set forth therefore in the Schedule of Performance. If and when the CDC decides to utilize its power of eminent domain, and if and when Developer timely elects an order of possession in any such action prior to entry of judgment, the CDC and Developer shall reasonably cooperate with Developer's lender and the Title Company in an effort to provide Developer's lender with security provided by Developer, including without limitation, an assignment of this Agreement as security and secure title insurance coverage for Developer and/or Developer's lender in connection with any Possession Deposit sufficient to cause said lender to advance the Possession Deposit to Developer. The failure of Developer to both timely elect an order of possession and to timely make the Possession Deposit shall result in all of Developer's rights ceasing under this Agreement while all of Developer's obligations pursuant to Section 203 shall continue. Time is of the essence in connection with this Section 203.1. In the event that Developer fails to timely make the Possession Deposit and the valuation date in any eminent domain action is changed and/or lost, Developer agrees to indemnify, defend and hold harmless the CDC, its elected officials, officers, employees and agents from and against any and all claims, liabilities, costs, expenses (including reasonable attorneys' fees), actions, causes of action, penalties or interest arising out of or in connection with change in or loss of the valuation date. 203.2 Option to Abandon Eminent Domain Action. If and after such time as the CDC may decide to commence a condemnation action in connection with the Property pursuant to its power of eminent domain, notwithstanding Developer's obligations pursuant to Section 202 above to pay all sums necessary for the completion of any such action, including, but not limited to, the Possession Deposit and the amount necessary to satisfy any judgment in such an action, if the judgment in such action is greater than Eight Million Dollars (S8,000,000), or at such time as it becomes apparent in the reasonable judgment of the Developer and CDC that the judgment in such an action will exceed S8,000,000, unless additional funding is then 7 017.262230.5 available from the CDC or other third party source, at the option of Developer, to be exercised by written notice to CDC, the CDC shall attempt to abandon the condemnation action whereupon (i) Developer shall remain liable for all Acquisition Costs and Post Termination Costs set forth above in Sections 202 and 203, and (ii) this Agreement shall terminate. 203.3 Triple Net Lease. Beginning on the date that any order for possession pursuant to California Code of Civil Procedure §§ 1255.410 et seq. may become effective, or such other date that the CDC obtains possession of the Property, CDC agrees to lease the Property to Developer pursuant to a triple net lease for Ten Dollars ($10) per month rent with Developer being completely responsible for any and all costs of the Property and CDC having no obligations whatsoever in connection with any repairs or modifications or costs and expenses of the Property (the "Triple Net Lease"). Developer and CDC agree to use a modified version of the AIR Single Tenant Lease -Net form for the Triple Net Lease. 204. Sale and Purchase. 204.1 Purchase and Sale. If Developer is unable to acquire the Property through its own efforts and in the event that CDC, following public hearings and receiving evidence, acquires the Property either through eminent domain or otherwise, then in accordance with and subject to all of the terms, conditions and covenants of this Agreement, CDC agrees to sell and Developer agrees to buy the Property. 204.2 Purchase Price. The Purchase Price to be paid by Developer for the Property ("Purchase Price") shall be: (a) In the event the Property is acquired by CDC through a negotiated purchase, the actual price paid by CDC for the Property, plus any other Acquisition Costs incurred to that date; or (b) in the event the Property is acquired by CDC through eminent domain proceedings, the amount of just compensation awarded to the owner of the Property, plus the amount of Acquisition Costs incurred by CDC. The actual Purchase Price shall be determined in accordance with the mandates of Section 33433 of the Health and Safety Code, if applicable, and shall not be less than the fair market value of the Property. The Developer Deposits shall be applied to the Purchase Price at the close of Escrow. In the event that CDC acquires the Property through its power of eminent domain or otherwise, the provisions of the sections below shall apply. 205. Escrow. The Parties shall open escrow ("Escrow") no later than thirty (30) days after CDC acquires title to the Property with Commonwealth Land Title Company, 1455 Frazee Road, Suite 600, San Diego, California 92108 or other title company mutually agreeable to the parties ("Escrow Holder"). 205.1 Costs of Escrow. CDC shall pay the premium for a standard CLTA Title Policy as set forth in Section 207 hereof and the documentary transfer taxes, if any, due with respect to the conveyance of the Property by CDC. Developer shall pay the added cost of an ALTA Extended Owners Policy if elected by Developer plus the cost of any required ALTA survey and/or endorsements. All other usual fees, charges and costs which arise from Escrow ("Escrow Costs") shall be paid by CDC and Developer, one-half by each. 8 017.262230.5 205.2 Escrow Instructions. This Agreement constitutes the joint escrow instructions of CDC and Developer, and Escrow Holder, to whom these instructions are delivered, is hereby empowered to act under this Agreement. The Parties hereto agree to do all acts reasonably necessary to close Escrow in the shortest possible time. Insurance policies for fire or casualty are not to be transferred, and CDC will cancel its own policies, if any, after the Closing. All funds received in the Escrow shall be deposited with other escrow funds in a general escrow account(s) and may be transferred to any other such escrow trust account in any state or national bank doing business in the State of California. All disbursements shall be made by check from such account. However, if Escrow does not close within five (5) business days from deposit of the Purchase Price, the funds shall be deposited into an interest bearing account with such interest accruing to the benefit of Developer. If, in the opinion of either Party or the Escrow Holder, it is necessary or convenient in order to accomplish the Closing, such Party may require that the Parties sign supplemental escrow instructions within fifteen (15) days of notice thereof; provided that, if there is any inconsistency between this Agreement and the supplemental escrow instructions, then the provisions of this Agreement shall control. The Parties agree to execute such other and further documents as may be reasonably necessary, helpful or appropriate to effectuate the provisions of this Agreement. The Closing shall take place within thirty (30) days after the date when both the CDC's Conditions Precedent and the Developer's Conditions Precedent as set forth in Sections 208.1 and 208.2 have been satisfied or waived by the respective Party. Escrow Holder is instructed to release CDC's escrow closing statements and Developer's escrow closing statements to the other Party. 205.3 Authority of Escrow Holder. Escrow Holder is authorized to, and shall: (a) Pay and charge Developer and CDC for their respective shares of the Escrow Costs payable under Section 205.1 of this Agreement. (b) Disburse funds and deliver and record the Grant Deed and Operating Covenant, when both the Developer's Conditions Precedent and the CDC's Conditions Precedent have been fulfilled or waived by Developer and CDC. (c) Do such other actions as necessary, including obtaining the Title Policy, to fulfill its obligations under this Agreement. (d) Within the discretion of Escrow Holder, direct CDC and Developer to execute and deliver any instrument, affidavit and statement and to perform any act reasonably necessary to comply with the provisions of FIRPTA and any similar state act and regulation promulgated thereunder. CDC agrees to execute a Certificate of Non -Foreign Status and/or a Certification of Compliance with Real Estate Reporting Requirement of the 1986 Tax Reform Act as may be required by Escrow Holder and a California Form 593-C (if applicable), on the form to be supplied by Escrow Holder. (e) Prepare and file with all appropriate governmental or taxing authorities a uniform settlement statement, closing statement, tax withholding forms including an 017.2E2230.5 9 IRS 1099-S form, and be responsible for withholding taxes, if any such forms as provided for or required by law. 205.4 Closing. This transaction shall close ("Closing") within thirty (30) days of the parties' satisfaction of all of CDC's and Developer's Conditions Precedent to Closing as set forth in Section 208 hereof, but in no event later than December 31, 2007 (the "Outside Date"). The Closing shall occur at the offices of Escrow Holder or other location within San Diego County at a time and place reasonably agreed on by the parties. The "Closing" shall mean the time and day the Grant Deed is filed for record with the San Diego County Recorder. The "Closing Date" shall mean the day on which the Closing occurs. 205.5 Termination. If Escrow is not in condition to close by the Outside Date, then either party that has fully performed under this Agreement may, in writing, demand the return of money or property and terminate the Escrow. If either party makes a written demand for return of documents or properties, the Escrow shall not terminate until five (5) days after Escrow Holder shall have delivered copies of such demand to all other parties at the respective addresses shown in this Agreement. If any objections are raised within said five (5) day period, Escrow Holder is authorized to hold all papers and documents until instructed by a court of competent jurisdiction or by mutual written instructions of the parties. Termination of the Escrow shall be without prejudice as to whatever legal rights either party may have against the other arising from this Agreement. If no demands are made, Escrow Holder shall proceed with the Closing as soon as possible. 205.6 Closing Procedure. Escrow Holder shall close Escrow for the purchase of the Property as follows: (a) Record the Grant Deed and Operating Covenant with instructions for the Recorder of San Diego County, Califomia to deliver the Grant Deed to Developer and Operating Covenant to the CDC. (b) Instruct the Title Company to deliver the Title Policy to Developer. (c) File any informational reports required by Internal Revenue Code Section 6045(e), as amended, and any other applicable requirements; and (d) Deliver the FIRPTA Certificate, if any, and Form 593-C (if applicable) to Developer; and (e) Forward to both Developer and CDC a separate accounting of all funds received and disbursed for each party and copies of all executed and recorded or filed documents deposited into Escrow, with such recording and filing date and information endorsed thereon. 206. Review of Title. CDC shall cause Escrow Holder ("Title Company") to deliver to Developer a standard preliminary consolidated title report ("Report") with respect to the title to the Property if Developer has not previously received a Report, together with legible copies of the documents ("Documents") underlying the exceptions ("Exceptions") set forth in the Report, within thirty (30) days from the date of this Agreement. Developer shall have the right to 10 017.262230.5 reasonably approve or disapprove the Exceptions in its sole and absolute discretion; provided, however, that Developer hereby approves the following Exceptions: (a) The Redevelopment Plan; (b) The Redevelopment Project; and (c) The lien of any non -delinquent property taxes and assessments (to be prorated at Close of Escrow. Owner shall have thirty (30) days from the date of its latest receipt of the Report and the Documents to give written notice to CDC and Escrow Holder of Developer's approval or disapproval of any such Exceptions. If Developer timely disapproves any Exceptions, CDC shall have thirty (30) days from the receipt of Developer's written notice to either cause such exceptions to be removed from the Report or provide assurance to Developer such Exceptions will be removed at or before the Closing. If CDC does not either cause the disapproved Exceptions to be removed or provide assurances thereof, Developer may terminate this Agreement. If Developer pays to CDC the Purchase Price, Developer shall be deemed to have approved the Exceptions for the Property. The Permitted Exceptions plus the Exceptions approved by Developer as provided herein shall be referred to as the "Condition of Title." CDC shall not voluntarily create any new exceptions to title following CDC's acquisition of the Property. Title to the fee shall be delivered to Developer free of all mortgages, deeds or trust, judgments and mechanics liens, not suffered or incurred by Developer. 207. Title Insurance. Concurrently with recordation of the Grant Deed from CDC to Developer conveying title to the Property, there shall be issued to Developer at Developer's election either a CLTA Owners Policy or an ALTA Extended Coverage Owner's policy of title insurance ("Title Policy"), together with such endorsements as are reasonably requested by Developer, issued by the Title Company insuring that the title to the Property is vested in Developer in the condition required by Section 206 of this Agreement. The Title Company shall provide CDC with a copy of the Title Policy. The Title Policy shall be for the amount of the Purchase Price. 208. Conditions of Closing. The Closing is conditioned upon the satisfaction of the following terms and conditions within the times designated below: 208.1 CDC's Conditions of Closing. CDC's obligation to proceed with the Closing of the sale of the Site is subject to the fulfillment or waiver by CDC of each and all of the conditions precedent (a) through (f), inclusive, described below ("CDC's Conditions Precedent"), which are solely for the benefit of CDC, and which shall be fulfilled or waived by the time periods provided for herein: (a) No Default. Prior to the Close of Escrow, Developer shall not be in default in any of its obligations under the terms of this Agreement and all representations and warranties of Developer contained herein shall be true and correct in all material respects. 017.262230.5 11 (b) Execution of Documents. The Developer shall have executed any documents required hereunder and delivered such documents into Escrow, including the Operating Covenant. (c) Payment of Funds. Prior to the Close of Escrow, Developer shall have paid the Purchase Price and all required costs of Closing into Escrow in accordance with Section 205.1 hereof. (d) Design Approvals. The Developer shall have obtained approval by the City of the Basic Concept Drawings. (e) Insurance. The Developer shall have provided proof of insurance as required by Section 306 hereof. (f) Financing. The CDC shall have approved acquisition financing as provided in Section 310 hereof, and such financing shall have closed and funded or be ready to close and fund upon the Closing. 208.2 Developer's Conditions of Closing. Developer's obligation to proceed with the purchase of the Site is subject to the fulfillment or waiver by Developer of each and all of the conditions precedent (a) through (e), inclusive, described below ("Developer's Conditions Precedent"), which are solely for the benefit of Developer, and which shall be fulfilled or waived by the time periods provided for herein: (a) No Default. Prior to the Close of Escrow, CDC shall not be in default in any of its obligations under the terms of this Agreement and all representations and warranties of CDC contained herein shall be true and correct in all material respects. (b) Execution of Documents. The CDC shall have executed the Grant Deed and Operating Covenant and any other documents required hereunder, and delivered such documents into Escrow. (c) Review and Approval of Title. Developer shall have reviewed and approved the condition of title of the Site, as provided in Section 206 hereof. (d) Title Policy. The Title Company shall, upon payment of Title Company's regularly scheduled premium, have agreed to provide the Title Policy to Developer for the Site upon the Close of Escrow, in accordance with Section 207 hereof. Notwithstanding the foregoing, if CDC has not obtained title to the Property, but has obtained a judicial order authorizing the CDC to take possession thereof, at the Developer's option CDC shall convey and the Developer shall accept the Property if the following conditions are met: (i) The CDC delivers exclusive possession of the Property to the Developer by Grant Deed, on or prior to the time set for conveyance thereof; (ii) The right of possession which the Developer acquires from the CDC is such that Title Company will issue a policy or 12 017.262230.5 as follows: policies of title insurance acceptable to Developer's lender as to the interest conveyed by said Grant Deed subject to only those items described in Section 206; and (iii) The Developer is able to secure financing for the acquisition of the Property on the basis of said Title Policy. In connection with such title policy, CDC (if required by the Title Company) and Developer agree to provide Title Company with an indemnity agreement in a form reasonably requested by the Title Company. 209. Representations and Warranties. follows: 209.1 CDC Representations. CDC represents and warrants to Developer as (a) Authority. CDC is a public body, corporate and politic, existing pursuant to the California Community Redevelopment Law (California Health and Safety Code Section 33000), which has been authorized to transact business pursuant to action of the City. (b) FIRPTA. CDC is not a "foreign person" within the parameters of FIRPTA or any similar state statute, or is exempt from the provisions of FIRPTA or any similar state statute, or that CDC has complied and will comply with all the requirements under FIRPTA or any similar state statute. (c) No Conflict. To the best of CDC's knowledge, CDC's execution, delivery and performance of its obligations under this Agreement will not constitute a default or a breach under any contract, agreement or order to which CDC is a party or by which it is bound. 209.2 Developer Representations. Developer represents and warrants to CDC (a) Authority. Developer is a corporation formed in and in good standing under the laws of the State of California, and is qualified to do business within the State of California. Developer has full right, power and lawful authority to purchase and accept the conveyance of the Site and undertake all obligations as provided herein and the execution, performance and delivery of this Agreement by Developer has been fully authorized by all requisite actions on the part of the Developer and any necessary third parties. (b) No Conflict. To the best of Developer's knowledge, Developer's execution, delivery and performance of its obligations under this Agreement will not constitute a default or a breach under any contract, agreement or order to which the Developer is a party or by which it is bound. (c) proceeding. 017.262230.5 No Bankruptcy. Developer is not the subject of a bankruptcy 13 210. "As Is" Sale. DEVELOPER ACKNOWLEDGES THAT, SUBJECT TO THE EXPRESS REPRESENTATIONS, WARRANTIES AND COVENANTS OF CDC UNDER THIS AGREEMENT, DEVELOPER IS PURCHASING THE SITE "AS IS" IN RELIANCE SOLELY ON: (A) DEVELOPER'S OWN INSPECTIONS OF THE SITE; (B) DEVELOPER'S INDEPENDENT VERIFICATION OF THE TRUTH OF ANY DOCUMENTS MADE AVAILABLE TO DEVELOPER; AND (C) THE OPINIONS AND ADVICE CONCERNING THE SITE OF CONSULTANTS ENGAGED BY DEVELOPER. DEVELOPER ACKNOWLEDGES AND AGREES THAT, EXCEPT FOR THE REPRESENTATIONS, WARRANTIES AND COVENANTS OF CDC EXPRESSLY SET FORTH IN THIS AGREEMENT, CDC IS NOT MAKING ANY OTHER WARRANTIES OR REPRESENTATIONS EXPRESS OR IMPLIED OF ANY KIND OR CHARACTER WITH RESPECT TO THE SITE, INCLUDING WITHOUT LIMITATION: (i) THE QUALITY, NATURE, ADEQUACY AND PHYSICAL CONDITION OF THE SITE, (ii) THE QUALITY, NATURE, ADEQUACY, AND PHYSICAL CONDITION OF SOILS, GEOLOGY AND ANY GROUNDWATER RELATING TO THE SITE, (iii) THE EXISTENCE, QUALITY, NATURE, ADEQUACY AND PHYSICAL CONDITION OF UTILITIES SERVING THE SITE, (iv) THE SITE'S USE, HABITABILITY, MERCHANTABILITY, OR FITNESS, SUITABILITY, VALUE OR ADEQUACY OF THE SITE FOR ANY PARTICULAR PURPOSE, (v) THE COMPLIANCE OF THE SITE WITH ANY APPLICABLE CODES, LAWS, REGULATIONS, STATUTES, ORDINANCES, COVENANTS, CONDITIONS AND RESTRICTIONS OF ANY GOVERNMENTAL OR QUASI -GOVERNMENTAL ENTITY OR OF ANY OTHER PERSON OR ENTITY, (vi) THE PRESENCE OF ANY HAZARDOUS MATERIALS ON, UNDER OR ABOUT THE SITE OR THE ADJOINING OR NEIGHBORING SITE, (vii) THE CONDITION OF TITLE TO THE SITE, AND (viii) THE ECONOMICS OF THE OPERATION OF THE SITE AS AN AUTOMOBILE SALES, SERVICE AND REPAIR FACILITY OR ANY OTHER USE. DEVELOPER WARRANTS AND REPRESENTS THAT IT HAS NOT RELIED AND WILL NOT RELY ON, EITHER DIRECTLY OR INDIRECTLY, ANY WARRANTY OR REPRESENTATION OF CDC OR ITS AGENTS NOT EXPLICITLY SET FORTH IN THIS AGREEMENT. 300. DEVELOPMENT OF THE SITE 301. Scope of Development. 301.1 Developer's Obligation to Construct Improvements. The Developer shall develop or cause the development of the Improvements in accordance with the Scope of Development, the City Municipal Code, and the plans. drawings and documents submitted by the Developer and approved by the CDC and City as set forth herein. 302. Design Review. 302.1 Basic Concept Drawings. The Developer has submitted conceptual drawings for the Improvements (collectively, the "Basic Concept Drawings") which the CDC has approved. 302.2 Site Plan Drawings. Within the time set forth in the Schedule of Performance, the Developer and CDC shall submit to the City plans and drawings with respect to 14 017.262230.5 the Improvements (the "Site Plan Drawings"), which must include all documents, plans and drawings (the "Construction Drawings"), including any application materials required by the City Planning Services Division, which are necessary to obtain all City approvals for the construction of the Improvements. 302.3 Consultation and Coordination. During the preparation of additional Site Plan Drawings, if any, and Construction Drawings, and other documents by Developer, staff of the CDC and the Developer shall hold regular progress meetings to coordinate the preparation of, submission to, and review of the Site Plan Drawings and Construction Drawings. The staff of the CDC and the Developer shall communicate and consult as frequently as is necessary to ensure that the formal submittal of any documents to the CDC can receive prompt and thorough consideration. The CDC shall designate a CDC employee/consultant to serve as the project manager who is responsible for the coordination of the CDC's activities under this Agreement. Approval of progressively more detailed drawings and specifications will be promptly granted by the CDC or designee if developed as a logical evolution of drawings or specifications theretofore approved. Any items so submitted and approved by the CDC or designee shall not be subject to subsequent disapproval. Any disapproval shall state in writing the reasons for disapproval and the changes which the CDC or designee requests to be made. Such reasons and such changes must be consistent with the Scope of Development and any items previously approved hereunder. Approval of progressively more detailed drawings and specifications will be promptly granted by the CDC or designee if developed as a logical evolution of drawings or specifications theretofore approved. Any items so submitted and approved by the CDC or designee shall not be subject to subsequent disapproval. Any disapproval shall state in writing the reasons for disapproval and the changes which the CDC or designee requests to be made. Such reasons and such changes must be consistent with the Scope of Development and any items previously approved hereunder. 302.4 Revisions. If the Developer desires to propose any material revisions to the CDC -approved Basic Concept Drawings, Site Plan Drawings or Construction Drawings, it shall submit such proposed changes to the CDC, and shall also proceed in accordance with any and all State and local laws and regulations regarding such revisions, within the time frame set forth in the Schedule of Performance. The CDC's Director is authorized to approve changes to the CDC -approved Basic Concept Drawings, Site Plan Drawings and Construction Drawings provided such changes: 1) do not materially reduce the quality of materials to be used; and 2) do not reduce the imaginative and unique qualities of the project design. Any and all change orders or revisions required by the City and its inspectors which are required under the Municipal Code and all other applicable Uniform Codes (e.g. Building, Plumbing, Fire, Electrical, etc.) and under other applicable laws and regulations shall be included by the Developer in its Basic Concept Drawings, Site Plan Drawings and Construction Drawings and completed during the construction of the Improvements. 302.5 Defects in Plans. The CDC shall not be responsible either to the Developer or to third parties in any way for any defects in the Basic Concept Drawings, the Site Plan Drawings or the Construction Drawings, or other documents prepared by or for the Developer, nor for any structural or other defects in any work done according to the approved Basic Concept Drawings, Site Plan Drawings or Construction Drawings or other documents 017.262230.5 15 prepared by or for the Developer, nor for any delays reasonably caused by the review and approval processes established by this Section 302. 303. Land Use Approvals. Before commencement of construction of the Improvements or other works of improvement upon the Site, the Developer shall, at its own expense, secure or cause to be secured any and all land use and other entitlements, permits and approvals which may be required for the Improvements by the City or any other governmental agency affected by such construction or work. The Developer shall, without limitation, apply for and secure the following, and pay all costs, charges and fees associated therewith: (a) City Site Plan Approval. (b) All other permits and fees required by the City, County of San Diego, and other governmental agencies with jurisdiction over the Improvements. (c) Any environmental studies and documents required pursuant to the California Environmental Quality Act, if any. The execution of this Agreement does not, however, constitute the granting of or a commitment to obtain any required land use permits, entitlements or approvals required by the CDC or the City. 304. Schedule of Performance. Each party to this Agreement shall perform the obligations to be performed by such party pursuant to this Agreement within the respective times provided in the Schedule of Performance, and if no such time is provided, within a reasonable time. The Schedule of Performance shall be subject to amendment from time to time upon the mutual agreement of the CDC and Developer. 305. Cost of Construction. All of the cost of planning, designing, developing, site preparation and constructing all of the Improvements shall be borne solely by the Developer. 306. Insurance Requirements. The Developer shall take out and maintain or shall cause its general contractor to take out and maintain until the issuance of the Release of Construction Covenants pursuant to Section 309 of this Agreement, a comprehensive general liability policy in the minimum amount of Three Million Dollars ($3,000,000.00) combined single limit policy, or such other policy limits as the CDC may approve at its discretion, including contractual liability, as shall protect the Developer, City and CDC from claims for such damages, and which policy shall be issued by a "B+" or higher rated insurance carrier. Such policy or policies shall be written on an occurrence form. The Developer shall also furnish or cause to be furnished to the CDC evidence satisfactory to the CDC that any contractor with whom it has contracted for the performance of work on the Site or otherwise pursuant to this Agreement carries workers' compensation insurance as required by law. The Developer shall furnish a certificate of insurance countersigned by an authorized agent of the insurance carrier on a form approved by the CDC setting forth the general provisions of the insurance coverage. This countersigned certificate shall name the City and the CDC and their respective officers, agents, and employees as additionally insured parties under the policy, and the certificate shall be accompanied by a duly executed endorsement evidencing such additional insured status. The certificate and endorsement by the insurance carrier shall contain a statement of obligation on the l6 017262230.5 part of the carrier to notify City and the CDC of any material change, cancellation or termination of the coverage at least thirty (30) days in advance of the effective date of any such material change, cancellation or termination. Coverage provided hereunder by the Developer shall be primary insurance and not be contributing with any insurance maintained by the CDC or City, and the policy shall contain such an endorsement. The insurance policy or the endorsement shall contain a waiver of subrogation for the benefit of the City and the CDC. The Developer shall furnish the required certificate prior to the Closing as a CDC Condition Precedent to the Closing. 307. Rights of Access. Prior to the issuance of a Release of Construction Covenants (as specified in Section 309 of this Agreement), for purposes of assuring compliance with this Agreement, representatives of the CDC shall have the right of reasonable access to the Site, without charges or fees, at normal construction hours during the period of construction for the purposes of this Agreement, including but not limited to, the inspection of the work being performed in constructing the Improvements so long as CDC representatives comply with all safety rules. The CDC (or its representatives) shall, except in emergency situations, notify the Developer at least forty-eight (48) hours prior to exercising its rights pursuant to this Section 307. 308. Compliance with Laws. The Developer shall carry out the design, construction and operation of the Improvements in conformity with all applicable laws, including all applicable state labor standards, the City zoning and development standards, building, plumbing, mechanical and electrical codes, and all other provisions of the City Municipal Code, and all applicable disabled and handicapped access requirements, including without limitation the Americans With Disabilities Act, 42 U.S.C. Section 12101, et seq., Government Code Section 4450, et seq., Government Code Section 11135, et seq., and the Unruh Civil Rights Act, Civil Code Section 51, et seq. 308.1 Nondiscrimination in Employment. Developer agrees that all persons employed or applying for employment by it, its affiliates, subsidiaries, or holding companies, and all subcontractors, bidders and vendors, are and will be treated equally by it without regard to, or because of race, color, religion, ancestry, national origin, sex, age, pregnancy, childbirth or related medical condition, medical condition (cancer related) or physical or mental disability, and in compliance with Title VII of the Civil Rights Act of 1964, 42 U.S.C. Section 2000, et seq., the Federal Equal Pay Act of 1963, 29 U.S.C. Section 206(d), the Age Discrimination in Employment Act of 1967, 29 U.S.C. Section 621, et seq., the Immigration Reform and Control Act of 1986, 8 U.S.C. Section 1324b, et seq., 42 U.S.C. Section 1981, the California Fair Employment and Housing Act, Cal. Government Code Section 12900, et seq., the California Equal Pay Law, Cal. Labor Code Section 1197.5, Cal. Government Code Section 11135, the Americans with Disabilities Act, 42 U.S.C. Section 12101, et seq., and all other anti- discrimination laws and regulations of the United States and the State of Califomia as they now exist or may hereafter be amended. 308.2 Prevailing Wages. All work pursuant to this Agreement shall be done in accordance with all applicable federal and state labor standards. Developer is aware of Sections 33423 — 33426 of the California Health and Safety Code and Sections 1 770 — 1780 of the California Labor Code and is aware of the requirements of California Labor Code Sections 1720 et. seq. and 1770 et seq. as well as California Code of Regulations, Title 8, §16000 et. seq. 017.262230.5 17 ("Prevailing Wage Laws"), which require the payment of prevailing wage rates and the performance of other requirements on certain "public works" and "maintenance" projects. In light of the fact that the Site is being purchased by Developer for its fair market value without public subsidy, it is the belief and understanding of the CDC and Developer that this Agreement does not involve a "public work" or "maintenance" project, as defined by the Prevailing Wage Laws. Notwithstanding the foregoing, Developer hereby expressly acknowledges and agrees that neither the City nor CDC has represented to Developer that the Project will not be a "public work" and in the event a determination should ever be made that this Agreement does involve a "public work" or "maintenance project" or is otherwise subject to Prevailing Wage Laws, Developer agrees to fully comply with such Prevailing Wage Laws. Developer shall defend, indemnify and hold the CDC, its elected officials, officers, employees and agents free and harmless from any and all claims, liabilities, costs, penalties or interest arising out of any failure or alleged failure to comply with the Prevailing Wage Laws in connection with this Agreement. If the CDC or any of the indemnified parties are named as a party in any dispute described in this Section 308.2, Developer agrees that the CDC and the other indemnified parties may appoint their own independent counsel who are reasonably acceptable to Developer, and Developer agrees to pay all reasonable attorneys' fees and defense costs of the CDC and the other indemnified parties, in addition to all other damages, fines, penalties and losses incurred by the CDC and the other indemnified parties as a result of the action. 308.3 Taxes and Assessments. Upon and after the Closing, at all times during which the Developer owns the Site, the Developer shall pay prior to delinquency all ad valorem real estate taxes and assessments on the Site, subject to the Developer's right to contest in good faith any such taxes. 308.4 Lien and Stop Notices. Developer shall not allow to be placed on the Site or any part thereof any lien or stop notice. If a claim of a lien or stop notice is given or recorded affecting the Improvements, Developer shall, within sixty (60) days of such recording or service or, within five (5) days of CDC's demand thereafter, whichever last occurs: (a) Pay and discharge the same; or (b) Effect the release thereof by recording and delivering to CDC a surety bond in sufficient form and amount, or otherwise; or (c) Provide CDC with other assurances, which CDC deems, in its sole discretion, to be satisfactory for the payment of such lien or bonded stop notice and for the full and continuous protection of CDC from the effect of such lien or bonded stop notice. 309. Release of Construction Covenants. Promptly after completion of the Improvements in conformity with this Agreement, the CDC shall furnish the Developer with a "Release of Construction Covenants," in the form of Attachment No. 6 hereto which is incorporated herein by reference. The CDC shall not unreasonably withhold such Rele. se of Construction Covenants. The Release of Construction Covenants shall be a conclusive determination of satisfactory completion of the Improvements and the Release of Construction Covenants shall so state. Any party then owning or thereafter purchasing, leasing or otherwise acquiring any interest in the Site shall not (because of such ownership, purchase, lease or l8 017.262230.5 acquisition) incur any obligation or liability under this Agreement except for those continuing covenants as described in the Grant Deed. If the CDC refuses or fails to furnish the Release of Construction Covenants, after written request from the Developer, the CDC shall, within ten (10) days of written request thereof, provide the Developer with a written statement of the reasons the CDC refused or failed to furnish the Release of Construction Covenants. The statement shall also contain the CDC's opinion of the actions the Developer must take to obtain the Release of Construction Covenants. The Release of Construction Covenants shall not constitute evidence of compliance with or satisfaction of any obligation of the Developer to any holder of any mortgage, or any insurer of a mortgage securing money loaned to finance the Improvements, or any part thereof. The Release of Construction Covenants is not a notice of completion as referred to in Section 3093 of the Califomia Civil Code. 310. Financing of the Improvements. 310.1 Approval of Financing. Developer shall submit to CDC reasonable assurances that Developer has sufficient funds on hand or has obtained sufficient commitments for construction financing necessary to undertake the development of the Site and the construction of the Improvements in accordance with this Agreement. The CDC shall approve or disapprove such evidence of financing commitments within fifteen (15) days of receipt of a complete submission. Approval shall not be unreasonably withheld or conditioned. If the CDC disapproves of the evidence of financing, CDC shall do so by Notice to Developer stating the reasons for such disapproval and Developer shall promptly obtain and submit to CDC new evidence of financing. CDC shall approve or disapprove such new evidence of financing in the same manner and within the same times established in this Section 310.] for the approval or disapproval of the evidence of financing as initially submitted to CDC. CDC agrees to make reasonable modifications of Sections 310 and 503 that may be requested by Developer's lender, provided such modifications do not adversely affect the receipt of any material benefit by CDC hereunder. Upon the reasonable request of a Developer's lender, CDC shall execute from time - to -time estoppel certificates to the extent they are consistent with the terms of this Agreement. CDC shall respond to any request under this paragraph within fifteen (15) days after receipt of the request accompanied by sufficient information as may be reasonably required in order for the CDC to act on such request. 310.2 No Encumbrances Except Mortgages and Deeds of Trust. Mortgages and deeds of trust shall be permitted for the purpose of securing loans of funds to be used for financing the construction of the Improvements (including architecture, engineering, legal, and related direct costs as well as indirect costs) on or in connection with the Site, permanent financing, and any other purposes necessary and appropriate in connection with development under this Agreement. The Developer shall notify the CDC in advance of any mortgage or deed of trust financing, if the Developer proposes to enter into the same before completion of the construction of the Improvements. 310.3 Holder Not Obligated to Construct Improvements. The holder of any mortgage or deed of trust authorized by this Agreement shall not be obligated by the provisions of this Agreement to construct or complete the Improvements or any portion thereof, or to 017.262230.5 19 guarantee such construction or completion; nor shall any covenant or any other provision in this Agreement be construed so to obligate such holder. Nothing in this Agreement shall be deemed to construe, permit or authorize any such holder to devote the Site to any uses or to construct any improvements thereon, other than those uses or improvements provided for or authorized by this Agreement. 310.4 Notice of Default to Mortgagee or Deed of Trust Holders; Right to Cure. With respect to any mortgage or deed of tru.st granted by Developer as provided herein, whenever the CDC may deliver any notice or demand to Developer with respect to any breach or default by the Developer in completion of construction of the Improvements, the CDC shall at the same time deliver to each holder of record of any mortgage or deed of trust authorized by this Agreement a copy of such notice or demand. Each such holder shall (insofar as the rights granted by the CDC are concerned) have the right, at its option, within one hundred twenty (120) days after the receipt of the notice, to cure or remedy or commence to cure or remedy and thereafter to pursue with due diligence the cure or remedy of any such default and to add the cost thereof to the mortgage debt and the lien of its mortgage. Nothing contained in this Agreement shall be deemed to permit or authorize such holder to undertake or continue the construction or completion of the Improvements, or any portion thereof (beyond the extent necessary to conserve or protect the improvements or construction already made) without first having expressly assumed the Developer's obligations to the CDC by written agreement reasonably satisfactory to the CDC. The holder, in that event, must agree to complete, in the manner provided in this Agreement, the Improvements to which the lien or title of such holder relates. Any such holder properly completing such Improvements shall be entitled, upon compliance with the requirements of Section 310 of this Agreement, to a Release of Construction Covenants. It is understood that a holder shall be deemed to have satisfied the one hundred twenty (120) day time limit set forth above for commencing to cure or remedy a Developer default which requires title and/or possession of the Site (or portion thereof) if and to the extent any such holder has within such one hundred twenty (120) day period commenced proceedings to obtain title and/or possession and thereafter the holder diligently pursues such proceedings to completion and cures or remedies the default. 310.5 Failure of Holder to Complete Improvements. In any case where, if within one hundred twenty (120) days after the holder of any mortgage or deed of trust creating a lien or encumbrance upon the Site or any part thereof receives a notice from the CDC of a default by the Developer in completion of construction of any of the Improvements under this Agreement, and such holder has not exercised the option to construct as set forth in Section 310.4, or if it has exercised the option but has defaulted hereunder and failed to timely cure such default, the CDC may purchase the mortgage or deed of trust by payment to the holder of the amount of the unpaid mortgage or deed of trust. If the ownership of the Site or any part thereof has vested in the holder, the CDC, if it so desires, shall be entitled to a conveyance from the holder to the CDC upon payment to the holder of an amount equal to the sum of the following: (a) The unpaid mortgage or deed of trust at the time title became vested in the holder (less all appropriate credits, including those resulting from collection and application of rentals and other income received during foreclosure proceedings); 20 017.262239.5 attomeys' fees; (b) All expenses with respect to foreclosure, including reasonable (c) The net expense, if any (exclusive of general overhead) incurred by the holder as a direct result of the subsequent ownership or management of the Site or part thereof, such as insurance costs and taxes; (d) The costs of any Improvements made by such holder; (e) An amount equivalent to the interest that would have accrued on the aggregate of such amounts had all such amounts become part of the mortgage or deed of trust debt and such debt had continued in existence to the date of payment by CDC; and, (f) Any customary prepayment charges imposed by the lender pursuant to its loan documents and agreed to by Developer. 310.6 Right of the CDC to Cure Mortgage or Deed of Trust. In the event of a mortgage or deed of trust default or breach by Developer prior to the completion of the construction of any of the Improvements or any part thereof, Developer shall immediately deliver to CDC a copy of any mortgage holder's notice of default. If the holder of any mortgage or deed of trust has not exercised its option to construct, or Developer has not cured or commenced a cure of such default, CDC shall have the right but not the obligation to cure the default. In such event, CDC shall be entitled to reimbursement from Developer of all proper costs and expenses incurred by CDC in curing such default. CDC shall also be entitled to a lien upon the Site to the extent of such costs and disbursements. Any such lien shall be junior and subordinate to the mortgages or deeds of trust pursuant to Section 310. 400. COVENANTS AND RESTRICTIONS 401. Use in Accordance with Redevelopment Plan. The Developer covenants and agrees for itself, its successors, assigns, and every successor in interest to the Site or any part thereof, that upon the Closing and during construction and thereafter, the Developer shall devote the Site to the uses specified in this Agreement for the periods of time specified therein. All uses conducted on the Site, including, without limitation, all activities undertaken by the Developer pursuant to this Agreement, shall conform to this Agreement and all applicable provisions of the City Municipal Code. The foregoing covenants shall run with the land. 402. Use Covenants. For a term commencing upon the Conveyance and ending upon the expiration of the Operating Covenant, the Developer hereby covenants and agrees for itself, its successors, and assigns and all voluntary and involuntary successors in interest to the Site, or any part thereof, that the Site will only be used in compliance with the Operating Covenant. 403. Maintenance Covenants. The Developer shall maintain the Site and all Improvements thereon, including all landscaping and erosion control, in a commercially reasonable manner. 017.262230.5 21 404. Nondiscrimination Covenants. The Developer covenants for itself and any successors in interest that there shall be no discrimination against or segregation of any person or group of persons on account of race, color, creed, religion, sex, marital status, national origin or ancestry in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the Site, nor shall the Developer or any person claiming under or through it establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees or vendees of the Site. The foregoing covenants shall run with the land. The Developer shall refrain from restricting the rental, sale or lease of the Site on the basis of race, color, religion, sex, marital status, ancestry or national origin of any person. All such deeds, leases or contracts shall contain or be subject to substantially the following nondiscrimination or non -segregation clauses: (a) In deeds: "The grantee herein covenants by and for himself or herself, his or her heirs, executors, administrators and assigns, and all persons claiming under or through them, that there shall be no discrimination against or segregation of, any person or group of persons on account of race, color, creed, religion, sex, marital status, national origin or ancestry in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the land herein conveyed, nor shall the grantee or any person claiming under or through him or her, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees or vendees in the land herein conveyed. The foregoing covenants shall run with the land." (b) In leases: "The lessee herein covenants by and for himself or herself, his or her heirs, executors, administrators, and assigns, and all persons claiming under or through him or her, and this lease is made and accepted upon and subject to the following conditions: "That there shall be no discrimination against or segregation of any person or group of persons, on account of race, color, creed, religion, sex, marital status, national origin, or ancestry in the leasing, subleasing, transferring, use, occupancy, tenure, or enjoyment of the premises herein leased nor shall the lessee himself or herself, or any person claiming under or through him or her, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use, or occupancy of tenants, lessees, sublessees, subtenants, or vendees in the premises herein leased." (c) In contracts: "There shall be no discrimination against or segregation of, any person, or group of persons on account of race, color, creed, religion, sex, marital status, national origin, or ancestry, in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the premises, nor shall the transferee himself or herself or any person claiming under or through him or her, establish or permit any such practice or practices of 22 017.262230.5 discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees or vendees of the premises." 405. Effect of Violation of the Terms and Provisions of this Agreement After Completion of Construction. The CDC is deemed the beneficiary of the twins and provisions of this Agreement and of the covenants running with the land, for and in its own right and for the purposes of protecting the interests of the community and other parties, public or private, in whose favor and for whose benefit this Agreement and the covenants running with the land have been provided, without regard to whether the CDC has been, remains or is an owner of any land or interest therein in the Site or in the Redevelopment Project. The CDC shall have the right, if the Agreement or covenants are breached, to exercise all rights and remedies, and to maintain any actions or suits at law or in equity or other proper proceedings to enforce the curing of such breaches and to avail itself of the rights granted herein to which it or any other beneficiaries of this Agreement and covenants may be entitled. The covenants contained in this Agreement shall remain in effect for the periods described herein, specifically including, without limitation, the following: (a) The covenants pertaining to use of the Site that are set forth in Section 401 and 402 of this Agreement shall remain in effect for the term of the Redevelopment Plan. (b) The covenants against discrimination, as set forth in Section 404 of this Agreement, shall remain in effect in perpetuity. 406. Indemnification. Developer hereby agrees to indemnify, defend and hold harmless the CDC, its elected officials, officers, employees and agents (the "Indemnified Parties") from and against any and all claims, losses, liabilities, costs, expenses (including reasonable attorneys' fees), actions, causes of action, penalties or interest arising out of or in connection with any third party challenges or objections to actions taken by any of the Indemnified Parties pursuant to this Agreement. 500. DEFAULTS AND REMEDIES 501. Default Remedies. Subject to the extensions of time set forth in Section 602 of this Agreement, failure by either Party to perform any action or covenant required by this Agreement within the time periods provided herein following notice and failure to cure as described hereafter, constitutes a "Default" under this Agreement. A Party claiming a Default shall give written notice of Default to the other Party specifying the Default complained of. Except for the obligations set forth in Sections 202 and 203, for which time is of the essence, or as otherwise expressly provided in this Agreement, the claimant shall not institute any proceeding against any other Party, and the other Party shall not be in Default if such Party within thirty (30) days from receipt of such notice immediately, with due diligence, commences to cure, correct or remedy such failure or delay and shall complete such cure, correction or remedy with diligence. 502. Institution of Legal Actions. In addition to any other rights or remedies and subject to the restrictions otherwise set forth in this Agreement, either Party may institute an 017.262230.5 23 action at law or equity to seek specific performance of the terms of this Agreement, or to cure, correct or remedy any Default, to recover damages for any Default, or to obtain any other remedy available at law or in equity. Such legal actions must be instituted in the Superior Court of the County of San Diego, State of California, or in the District of the United States District Court in which such county is located. 503. Reentry and Revesting of Title in the CDC After the Closing and Prior to Completion of Construction. Subject to the notice and cure provisions of this Agreement and the rights of a holder of any mortgage or deed of trust encumbering the Site, the CDC has the right, at its election, to reenter and take possession of the Site, with all Improvements thereon, and terminate and revest in the CDC the estate conveyed to the Developer if after the Closing and prior to the issuance of the Release of Construction Covenants, the Developer (or its successors in interest) shall: (a) Unless due to an Enforced Delay as described in Section 602 hereof, fail to start the construction of the Improvements as required by this Agreement for a period of one hundred twenty (120) days after written notice thereof from the CDC; or (b) Abandon or substantially suspend construction of the Improvements required by this Agreement for a period of one hundred twenty (120) days after written notice thereof from the CDC; or (c) Contrary to the provisions of Section 603 Transfer or suffer any involuntary Transfer in violation of this Agreement, and such transfer has not been approved by the CDC or rescinded within sixty (60) days of notice thereof from CDC to Developer. Such right to reenter, terminate and revest shall be subject to and be limited by and shall not defeat, render invalid or limit: (a) Any mortgage or deed of trust permitted by this Agreement; (b) Any rights or interests provided in this Agreement for the protection of the holders of such mortgages or deeds of trust; or (c) Any rights or interests held by a lessee in and to the Property. The Grant Deed shall contain appropriate reference and provision to give effect to the CDC's right as set forth in this Section 503, under specified circumstances prior to recordation of the Release of Construction Covenants, to reenter and take possession of the Site, with all improvements thereon, and to terminate and revest in the CDC the estate conveyed to the Developer. Upon the revesting in the CDC of title to the Site as provided in this Section 503, the CDC shall, pursuant to its responsibilities under State law, use its reasonable efforts to resell the Site as soon and in such manner as the CDC shall find feasible and consistent with the objectives of such law and of the Redevelopment Plan, as it exists or may be amended, to a qualified and responsible party or parties (as determined by the CDC) who will assume the obligation of making or completing the Improvements, or such improvements in their stead as shall be satisfactory to the CDC and in accordance with the uses specified for such Site or part thereof in the Redevelopment Plan. Upon such resale of the Site, the net proceeds thereof after repayment 24 017.262230.5 in full of any loan evidenced by a mortgage or deed of trust encumbering the Site which is permitted by this Agreement, shall be applied: (i) First, to reimburse the CDC, on its own behalf or on behalf of the City, all costs and expenses incurred by the CDC, excluding City and CDC staff costs, but specifically, including, but not limited to, any expenditures by the CDC or the City in connection with the recapture, management and resale of the Site or part thereof (but less any income derived by the CDC from the Site or part thereof in connection with such management); all taxes, assessments and water or sewer charges with respect to the Site or part thereof which the Developer has not paid (or, in the event that Site is exempt from taxation or assessment of such charges during the period of ownership thereof by the CDC, an amount, if paid, equal to such taxes, assessments, or charges as would have been payable if the Site were not so exempt); any payments made or necessary to be made to discharge any encumbrances or liens existing on the Site or part thereof at the time or reverting of title thereto in the CDC, or to discharge or prevent from attaching or being made any subsequent encumbrances or liens due to obligations, defaults or acts of the Developer, its successors or transferees; any expenditures made or obligations incurred with respect to the making or completion of the Improvements or any part thereof on the Site, or part thereof; and any amounts otherwise owing the CDC, and in the event additional proceeds are thereafter available, then (ii) Second, to reimburse the Developer, its successor or transferee, up to the amount equal to the sum of the costs incurred for the acquisition and development of the Site and for the improvements existing on the Site at the time of the reentry and possession. Any balance remaining after such reimbursements shall be retained by the CDC as its property. The rights established in this Section 503 are not intended to be exclusive of any other right, power or remedy, but each and every such right, power, and remedy shall be cumulative and concurrent and shall be in addition to any other right, power and remedy authorized herein or now or hereafter existing at law or in equity. These rights are to be interpreted in light of the fact that the CDC will have conveyed the Site to the Developer for redevelopment purposes and not for speculation in undeveloped land. 504. Acceptance of Service of Process. In the event that the Developer commences legal action against the CDC, service of process on the CDC shall be made by personal service upon the Director of the CDC or in such other manner as may be provided by law. In the event that the CDC commences legal action against the Developer, service of process on the Developer 017.262230.5 25 shall be made by personal service on the Developer, whether made within or outside the State of California, or in such other manner as may be provided by law. 505. Rights and Remedies Are Cumulative. Except as otherwise expressly stated in this Agreement, the rights and remedies of the parties are cumulative, and the exercise by either party of one or more of such rights or remedies shall not preclude the exercise by it, at the same or different times, of any other rights or remedies for the same default or any other default by the other party. 506. Inaction Not a Waiver of Default. Any failures or delays by either 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 such rights or remedies, or deprive either such party of its right to institute and maintain any actions or proceedings which it may deem necessary to protect, assert or enforce any such rights or remedies. 507. Applicable Law. The laws of the State of California shall govern the interpretation and enforcement of this Agreement. 508. Non -Liability of Officials and Employees of the CDC. No member, official or employee of the CDC or the City shall be personally liable to the Developer, or any successor in interest, in the event of any Default or breach by the CDC (or the City) or for any amount which may become due to the Developer or its successors, or on any obligations under the terms of this Agreement. 509. Attorneys' Fees. In any action between the parties to interpret, enforce, reform, modify, rescind, or otherwise in connection with any of the terms or provisions of this Agreement, the prevailing party in the action shall be entitled, in addition to damages, injunctive relief, or any other relief to which it might be entitled, reasonable costs and expenses including, without limitation, litigation costs and reasonable attorneys' fees. 600. GENERAL PROVISIONS 601. Notices, Demands and Communications Between the Parties. Any approval, disapproval, demand; document or other notice ("Notice") which either party may desire to give to the other party under this Agreement must be in writing and may be given by any commercially acceptable means to the party to whom the Notice is directed at the address of the party as set forth below, or at any other address as that party may later designate by Notice. To CDC: CONL'dUNTTY DEVELOPMENT COMMISSION OF THE CITY OF NATIONAL CITY 140 E. 12th Street, Suite B National City, CA 91950-3312 Attention: Executive Director 26 017.262230.5 Copy to: Richard L. Moskitis, Esq. FOLEY & LARDNER LLP 401 West Broadway, 23'd Floor San Diego, CA 92101-3542 To Developer: MOSSY NISSAN, INC. 9755 Clairernont Mesa Blvd. San Diego, CA 92124 Attention: Philip E. Mossy Telephone: (858) 654-2850 Facsimile: (858) 614-0132 Copy to: Edward F. Whittler, Esq. PETERSON & PRICE, APC 530 B Street, Suite 1700 San Diego, CA 92101 Telephone: (619) 234-0361 Facsimile: (619) 234-4786 Copy to: Alex Zirpolo 617 Saxony Place, Suite 101 Encinitas, CA 92024 Any written notice, demand or communication shall be deemed received immediately if delivered by hand and shall be deemed received on the third day from the date it is postmarked if delivered by registered or certified mail. 602. Enforced Delay; Extension of Times of Performance. In addition to specific provisions of this Agreement, performance by either party hereunder shall not be deemed to be in Default, and al] performance and other dates specified in this Agreement shall be extended, where delays or Defaults are due to causes beyond the reasonable control or without the fault of the Party claiming an extension of time to perform, which may include the following: war; acts of international and domestic terrorism, insurrection; strikes; lockouts; riots; floods; earthquakes; fires; casualties; acts of God; acts of the public enemy; epidemics; quarantine restrictions; freight embargoes; lack of transportation; governmental restrictions or priority; litigation; severe weather; inability to secure necessary labor, materials or tools; delays of any contractor, subcontractor or supplier; acts or omissions of the other Party, acts or failures to act of the City or any other public or governmental agency or entity (other than the acts or failures to act of the CDC which shall not excuse performance by the CDC) (an "Enforced Delay"). Notwithstanding anything to the contrary in this Agreement, an extension of time for any such cause shall be for the period of the Enforced Delay and shall commence to run from the time of the commencement of the cause, if notice by the Party claiming such extension is sent to the other Party within thirty (30) days of the commencement of the cause. Times of performance under this Agreement may also be extended in writing by the mutual agreement of CDC and Developer. Notwithstanding any provision of this Agreement to the contrary, the lack of funding to complete the Improvements shall not constitute grounds of Enforced Delay pursuant to this Section 602. 017.262230.5 27 603. Transfers of Interest in Site or Agreement. The qualifications and identity of the Developer as the developer of high quality Project are of particular concern to the CDC. Furthermore, the Parties acknowledge that the CDC has negotiated the terms of this Agreement in contemplation of the development of the Improvements as described in the Scope of Development of this Agreement. Accordingly, for the period commencing upon the date of this Agreement and until the CDC's issuance of the Release of Construction Covenants as set forth in Section 309 hereof, (a) no voluntary or involuntary successor in interest of the Developer shall acquire any rights or powers under this Agreement, and (b) nor shall the Developer make any total or partial sale, transfer, conveyance, assignment, subdivision, of the whole or any part of the Site (a "Transfer")without the prior written approval of the CDC, except as expressly set forth herein. 603.1 Permitted Transfers. Notwithstanding any other provision of this Agreement to the contrary, CDC approval of a Transfer of the Site or a portion of the Site shall not be required in connection with any of the following: (a) Any Transfer to a limited liability company, partnership, corporation, or other entity or entities in which Developer or one of its members or shareholders retains a portion of the ownership or beneficial interest and retains management and control of the transferee entity or entities. (b) The conveyance or dedication of any portion of the Site to the City or other appropriate governmental agency, or the granting of easements or permits to facilitate construction of the Improvements. (c) Any requested assignment for financing purposes (subject to such financing being considered and approved by the CDC pursuant to Section 310.1 herein), including the grant of a deed of trust to secure the funds necessary for construction of the Improvements. (d) Any lease of commercial space within the Site to tenants in the ordinary course of business. In the event of a Transfer by Developer under subparagraph (a) above not requiring the CDC's prior approval, Developer nevertheless agrees that at least fifteen (15) days before such Transfer it shall give written notice to CDC of such assignment and satisfactory evidence that the assignee has assumed in writing through an assignment and assumption agreement all of the obligations of this Agreement. Such assignment shall release the assigning Developer from any obligations to the CDC hereunder. 603.2 CDC Consideration of Requested Transfer. The CDC agrees that it will not unreasonably withhold approval of a request for approval of a Transfer made pursuant to this Section 603, provided the Developer delivers written notice to the CDC requesting such approval. Such notice shall be accompanied by evidence regarding the proposed transferee's development and/or operational qualifications and experience, and its financial commitments and resources, in sufficient detail to enable the CDC to evaluate the proposed assignee or purchaser pursuant to the criteria set forth in this Section 603 and as reasonably determined by the CDC. 28 017.262230.5 The CDC may, in considering any such request, take into consideration such factors as (i) the quality of any new and/or replacement operator, (ii) the transferee's past performance as an operator of new automobile dealerships, (iii) the current financial condition of the transferee, and similar factors. The CDC agrees not to unreasonably withhold its approval of any such requested Transfer, taking into consideration the foregoing factors. An assignment and assumption agreement in form satisfactory to the CDC's legal counsel shall also be required for all proposed Transfers. Within thirty (30) days after the receipt of the Developer's written notice requesting CDC approval of a Transfer pursuant to this Section 603, the CDC shall either approve or disapprove such proposed assignment or shall respond in writing by stating what further information, if any, the CDC reasonably requires in order to complete the request and determine whether or not to grant the requested approval. Upon receipt of such a response, the Developer shall promptly furnish to the CDC such further information as may be reasonably requested. 603.3 Successors and Assigns. Subject to the restrictions on Transfer set forth above in Section 603, all of the terms, covenants and conditions of this Agreement shall be binding upon the Developer and its permitted successors and assigns. Whenever the term "Developer" is used in this Agreement, such term shall include any other permitted successors and assigns as herein provided. 603.4 Assignment by CDC. The CDC may assign or transfer any of its rights or obligations under this Agreement without the approval of the Developer. 604. Relationship Between CDC and Developer. It is hereby acknowledged that the relationship between the CDC and the Developer is not that of a partnership or joint venture and that the CDC and the Developer shall not be deemed or construed for any purpose to be the agent of the other. Accordingly, except as expressly provided herein or in the Attachments hereto, the CDC shall have no rights, powers, duties or obligations with respect to the development, operation, maintenance or management of the Improvements. 605. CDC Approvals and Actions. The CDC shall maintain authority of this Agreement and the authority to implement this Agreement through the CDC Executive (or acting) Director (or his/her duly authorized representative). The CDC Executive (or acting) Director shall have the authority to make approvals, issue interpretations, waive provisions, and/or enter into certain amendments of this Agreement on behalf of the CDC so long as such actions do not materially or substantially change the uses or development permitted on the Site, or add to the costs incurred or to be incurred by the CDC as specified herein, and such approvals, interpretations, waivers and/or amendments may include extensions of time to perform as specified in the Schedule of Performance. All other material and/or substantive interpretations, waivers, or amendments shall require the consideration, action and written consent of the CDC Board. 606. Counterparts. This Agreement may be signed in multiple counterparts which, when signed by all parties, shall constitute a binding agreement. This Agreement is executed in three (3) originals, each of which is deemed to be an original. 017.262230.5 29 607. Integration. This Agreement contains the entire understanding between the Parties relating to the transaction contemplated by this Agreement, notwithstanding any previous negotiations or agreements between the Parties or their predecessors in interest with respect to all or any part of the subject matter hereof. All prior or contemporaneous agreements, understandings, representations and statements, oral or written, are merged in this Agreement and shall be of no further force or effect. Each Party is entering this Agreement based solely upon the representations set forth herein and upon each Party's own independent investigation of any and all facts such party deems material. This Agreement includes Attachment Nos. 1 through 7, which are incorporated herein. 608. Real Estate Brokerage Commission. Except for Developer's obligation to pay Mr. Alex Zirpolo a commission pursuant to a separate agreement between Developer and Mr. Zirpolo, the CDC and the Developer each represent and warrant to the other that no broker or finder is entitled to any commission or finder's fee in connection with the Developer's acquisition of the Site from the CDC. Each of the Parties agrees to defend and hold harmless the other Party from any claim to any such commission or fee from any other broker, agent or fmder with respect to this Agreement which is payable by such Party. 609. Titles and Captions. Titles and captions are for convenience of reference only and do not define, describe or limit the scope or the intent of this Agreement or of any of its terms. Reference to section numbers is to sections in this Agreement, unless expressly stated otherwise. 610. Interpretation. As used in this Agreement, masculine, feminine or neuter gender and the singular or plural number shall each be deemed to include the others where and when the context so dictates. The word `including" shall be construed as if followed by the words "without limitation." This Agreement shall be interpreted as though prepared jointly by both Parties. 611. No Waiver. A waiver by either Party of a breach of any of the covenants, conditions or agreements under this Agreement to be perfoi wed by the other Party shall not be construed as a waiver of any succeeding breach of the same or other covenants, agreements, restrictions or conditions of this Agreement. 612. Modifications. Any alteration, change or modification of or to this Agreement, in order to become effective, shall be made in writing and in each instance signed on behalf of each Party. 613. Severability. If any term, provision, condition or covenant of this Agreement or its application to any Party or circumstances shall be held, to any extent, invalid or unenforceable, the remainder of this Agreement, or the application of the term, provision, condition or covenant to persons or circumstances other than those as to whom or which it is held invalid or unenforceable, shall not be affected, and shall be valid and enforceable to the fullest extent permitted by law. 614. Computation of Time. The time in which any act is to be done under this Agreement is computed by excluding the first day (such as the day escrow opens), and including 30 017.262230.5 the last day, unless the last day is a holiday or Saturday or Sunday, and then that day is also excluded. The term "holiday" shall mean all holidays as specified in Section 6700 and 6701 of the California Government Code. If any act is to be done by a particular time during a day, that time shall be Pacific Time Zone time. 615. Legal Advice. Each Party represents and warrants to the other the following: they have carefully read this Agreement, and in signing this Agreement, they do so with full knowledge of any right which they may have; they have received independent legal advice from their respective legal counsel as to the matters set forth in this Agreement, or have knowingly chosen not to consult legal counsel as to the matters set forth in this Agreement; and, they have freely signed this Agreement without any reliance upon any agreement, promise, statement or representation by or on behalf of the other Party, or their respective agents, employees, or attorneys, except as specifically set forth in this Agreement, and without duress or coercion, whether economic or otherwise. 616. Time of Essence. Time is expressly made of the essence with respect to the performance by the CDC, and the Developer of each and every obligation and condition of this Agreement. 617. Cooperation. Each party agrees to cooperate with the other in this transaction and, in that regard, to sign any and all documents which may be reasonably necessary, helpful, or appropriate to carry out the purposes and intent of this Agreement including, but not limited to, releases or additional agreements. 618. Conflicts of Interest. No member, official or employee of the CDC shall have any personal interest, direct or indirect, in this Agreement, nor shall any such member, official or employee participate in any decision relating to the Agreement which affects his/her personal interests or the interests of any corporation, partnership or association in which he/she is directly or indirectly interested. 619. Time for Acceptance of Agreement by CDC. This Agreement, when executed by the Developer and delivered to the CDC, must be authorized, executed and delivered by the CDC on or before forty-five (45) days after signing and delivery of this Agreement by the Developer or this Agreement shall be void, except to the extent that the Developer shall consent in writing to a further extension of time for the authorization, execution and delivery of this Agreement. 017.262230.5 31 IN WITNESS WHEREOF, the CDC and the Developer have executed this Disposition and Development Agreement as of the date set forth above. CDC: COMMUNITY DEVELOPMENT COMMISSION OF THE OF THE CITY OF NATIONAL CITY, a public body, corporate and politic By: Nick Inzunza, Chairman ATTEST: , CDC Secretary APPROVED AS TO FORM: CDC Counsel DEVELOPER: MOSSY NISS AN, INC., a California corporation By: By: Philip E. Mossy, President Secretary Signature Page of Disposition and Development Agreement 32 017.262230.5 017.262230.5 ATTACHMENT NO. 1 SITE MAP Attachment No. 1-1 9 0£ZZ9Z'LC0 -IIIoLULi3Ewij ,.T.-•-•-r-,• rir..rrrirnr... 7 21 9 • TRANSPORTATION , Lis IS u xu row Otto ru 1141 a PM 3 (31 3f.�9 A4. • • rmrw'r AV E O 10 lux;i IA? 1.410DAE IIOYE (COO LfdGE) AVE dalal 1 a . M/72Vf (:- �gJ11('. NNN. 7� ZMIM•UNIFmini [HOOVER ;WE 562-34 POR 18 ' Irfiw 4111 ggl•OY811.e ATTACHMENT NO. 2 SITE LEGAL DESCRIPTION Parcel A: (APN: 562-340-47) The northerly 164.00 feet of lot 5 of E. J. Christman Business and Industrial Park I, in the City of National City, County of San Diego, State of Califomia, according to Map thereof No. 8038, Filed in the Office f the County Recorder of San Diego County, November 7, 1974. Parcel B: (APN: 562-340-48) Lot 5 of E. J. Christman Business and Industrial Park I, in the City of National City, County of San Diego, State of California, according to Map thereof No. 8038, Filed in the Office f the County Recorder of San Diego County, November 7, 1974. Excepting therefrom the northerly 164.00 feet. Attachment No. 2 017.262230.5 ATTACHMENT NO. 3 RECORDLNG REQUESTED BY, ) MAIL TAX STATEMENTS TO AND ) WHEN RECORDED MAIL TO: ) ) ) ) ) ) ) This document is exempt from payment of a recording fee pursuant to Government Code Section 27383 GRANT DEED For valuable consideration, receipt of which is hereby acknowledged, the COMMUNITY DEVELOPMENT COMMISSION OF THE CITY OF NATIONAL CITY, a public body, corporate and politic (the "CDC"), acting to carry out the Redevelopment Plan ("Redevelopment Plan") for the National City Redevelopment Project (the "Project"), under the Community Redevelopment Law of California, as of , 200� hereby grants to MOSSY NISSAN, INC., a California corporation ("Developer"), the real property hereinafter referred to as the "Site," described in Exhibit A attached hereto and incorporated herein, subject to the existing easements, restrictions and covenants of record described there. 1. Reservation of Mineral Rights. CDC excepts and reserves from the conveyance herein described all interest of the CDC in oil, gas, hydrocarbon substances and minerals of every kind and character lying more than five hundred (500) feet below the surface, together with the right to drill into, through, and to use and occupy all parts of the Site lying more than five hundred (500) feet below the surface thereof for any and all purposes incidental to the exploration for and production of oil, gas, hydrocarbon substances or minerals from said Site or other lands, but without, however, any right to use either the surface of the Site or any portion thereof within five hundred (500) feet of the surface for any purpose or purposes whatsoever, or to use the Site in such a manner as to create a disturbance to the use or enjoyment of the Site. 2. Conveyance in Accordance With Redevelopment Plan, Disposition and Development Agreement. The Site is conveyed in accordance with and subject to the Redevelopment Plan which was approved and adopted by Ordinance No. 95-2095 of the City Council of the City of National City, and a Disposition and Development Agreement entered into between CDC and Developer dated July 26, 2005 (the "DDA"), a copy of which is on file with the CDC at its offices as a public record and which is incorporated herein by reference. The DDA generally requires the Developer to rehabilitate, remodel, construct and maintain in a first class condition a new automobile sales, service and repair facility and related parking on the Site, and other requirements as set forth therein (the "Improvements"). All terms used herein shall have the same meaning as those used in the DDA. Attachment No. 3-1 017.262230.5 3. Restrictions on Transfer. The Developer further agrees as follows: (a) For the period commencing upon the date of this Grant Deed and until the CDC's issuance of the Release of Construction Covenants as set forth in Section 310 of the DDA, no voluntary or involuntary successor in interest of the Developer shall acquire any rights or powers under the DDA or this Grant Deed, nor shall the Developer make any total or partial sale, transfer, conveyance, assignment, subdivision, without the prior written approval of the CDC or as otherwise permitted pursuant to Section 603 of the DDA. (b) The Developer shall not place or suffer to be placed on the Site any lien or encumbrance other than mortgages, deeds of trust, or any other form of conveyance required for financing of the construction of the Improvements on the Site, and any other expenditures necessary and or appropriate to develop the Site as provided in Section 310.2 of the DDA.. (c) All of the terms, covenants and conditions of this Grant Deed shall be binding upon the Developer and the permitted successors and assigns of the Developer. Whenever the term "Developer" is used in this Grant Deed, such term shall include any other successors and assigns as herein provided. 4. Nondiscrimination. The Developer herein covenants by and for itself, its heirs, executors, administrators and assigns, and all persons claiming under or through them, that there shall be no discrimination against or segregation of, any person or group of persons on account of race, color, creed, religion, sex, marital status, national origin or ancestry in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the land herein conveyed, nor shall the Developer itself or any person claiming under or through Developer, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sub lessees or vendees in the land herein conveyed. The foregoing covenants shall run with the land. The Developer shall refrain from restricting the rental, sale or lease of the Site on the basis of race, color, religion, sex, marital status, ancestry or national origin of any person. All such deeds, leases or contracts shall contain or be subject to substantially the following nondiscrimination or nonsegregation clauses: (a) In deeds: "The grantee herein covenants by and for himself or herself, his or her heirs, executors, administrators and assigns, and all persons claiming under or through them, that there shall be no discrimination against or segregation of, any person or group of persons on account of race, color, creed, religion, sex, marital status, national origin or ancestry in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the land herein conveyed, nor shall the grantee or any person claiming under or through him or her, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sub lessees or vendees in the land herein conveyed. The foregoing covenants shall run with the land." (b) In leases: "The lessee herein covenants by and for himself or herself, his or her heirs, executors, administrators, and assigns, and all persons claiming under or through him or her, and this lease is made and accepted upon and subject to the following conditions: 017.262230.5 Attachment No. 3-2 "That there shall be no discrimination against or segregation of any person or group of persons, on account of race, color, creed, religion, sex, marital status, national origin, or ancestry in the leasing, subleasing, transferring, use, occupancy, tenure, or enjoyment of the premises herein leased nor shall the lessee himself or herself, or any person claiming under or through him or her, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use, or occupancy of tenants, lessees, sub lessees, subtenants, or vendees in the premises herein leased." (c) In contracts: "There shall be no discrimination against or segregation of, any person, or group of persons on account of race, color, creed, religion, sex, marital status, national origin, or ancestry, in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the premises, nor shall the transferee himself or herself or any person claiming under or through him or her, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sub lessees or vendees of the premises." 5. CDC Right of Reentry. The CDC has the right, at its election, to reenter and take possession of the Site, with all improvements thereon, and terminate and revest in the CDC the estate conveyed to the Developer if after the Closing and prior to the issuance of the Release of Construction Covenants, the Developer (or its successors in interest) shall: a. fail to start the construction of the Improvements as required by the DDA for a period of one hundred twenty (120) days after written notice thereof from the CDC; or b. abandon or substantially suspend construction of the Improvements required by the DDA for a period of one hundred twenty (120) days after written notice thereof from the CDC; or c. contrary to the provisions of Section 603 of the DDA transfer or suffer any involuntary Transfer in violation of the DDA, and such transfer has not been approved by the CDC or rescinded within sixty (60) days of notice thereof from CDC to Developer. Such right to reenter, terminate and revest shall be subject to and be limited by and shall not defeat, render invalid or limit: 1. Any mortgage or deed of trust permitted by the DDA; or 2. Any rights or interests provided in the DDA for the protection of the holders of such mortgages or deeds of trust. 3. Any rights or interests held by a lessee permitted by the DDA in and to the property. 017.262230.5 Attachment No. 3-3 Upon the revesting in the CDC of title to the Site as provided in this Section 5, the CDC shall, pursuant to its responsibilities under state law, use its reasonable efforts to resell the Site as soon and in such manner as the CDC shall find feasible and consistent with the objectives of such law and of the Redevelopment Plan, as it exists or may be amended, to a qualified and responsible party or parties (as determined by the CDC) who will assume the obligation of making or completing the Improvements, or such improvements in their stead as shall be satisfactory to the CDC and in accordance with the uses specified for the Site or part thereof in the Redevelopment Plan. Upon such resale of the Site, the net proceeds thereof after repayment of any mortgage or deed of trust encumbering the Site which is permitted by this Agreement, shall be applied: i. First, to reimburse the CDC, on its own behalf or on behalf of the City, all costs and expenses incurred by the CDC, excluding City and CDC staff costs, but specifically, including, but not limited to, any expenditures by the CDC or the City in connection with the recapture, management and resale of the Site or part thereof (but less any income derived by the CDC from the Site or part thereof in connection with such management); all taxes, assessments and water or sewer charges with respect to the Site or part thereof which the Developer has not paid (or, in the event that Site is exempt from taxation or assessment of such charges during the period of ownership thereof by the CDC, an amount, if paid, equal to such taxes, assessments, or charges as would have been payable if the Site were not so exempt); any payments made or necessary to be made to discharge any encumbrances or liens existing on the Site or part thereof at the time or revesting of title thereto in the CDC, or to discharge or prevent from attaching or being made any subsequent encumbrances or liens due to obligations, defaults or acts of the Developer, its successors or transferees; any expenditures made or obligations incurred with respect to the making or completion of the improvements or any part thereof on the Site, or part thereof and any amounts otherwise owing the CDC, and in the event additional proceeds are thereafter available, then ii. Second, to reimburse the Developer, its successor or transferee, up to the amount equal to the sum of (a) the costs incurred for the acquisition and development of the Site and for the improvements existing on the Site at the time of the reentry and possession. Any balance remaining after such reimbursements shall be retained by the CDC as its property. The rights established in this Section 6 are not intended to be exclusive of any other right, power or remedy, but each and every such right, power, and remedy shall be cumulative and concurrent and shall be in addition to any other right, power and remedy authorized herein or now or hereafter existing at law or in equity. These rights are to be interpreted in light of the fact that the CDC will have conveyed the Site to the Developer for redevelopment purposes. 6. Violations Do Not Impair Liens. No violation or breach of the covenants, conditions, restrictions, provisions or limitations contained in this Grant Deed shall defeat or render invalid or in any way impair the lien or charge of any mortgage or deed of trust or security interest permitted by paragraph 4 of this Grant Deed; provided, however, that any subsequent owner of the Site shall be bound by such remaining covenants, conditions, restrictions, limitations and provisions, whether such owner's title was acquired by foreclosure, deed in lieu of foreclosure, trustee's sale or otherwise. 017.262230.5 Attachment No. 3-4 7. Covenants Run With Land. All covenants contained in this Grant Deed shall be covenants running with the land. All of Developer's obligations hereunder except as provided hereunder shall terminate and shall become null and void upon the expiration of the Redevelopment Plan. Every covenant contained in this Grant Deed against discrimination contained in paragraph 4 of this Grant Deed shall remain in effect in perpetuity. 8. Covenants For Benefit of CDC. All covenants without regard to technical classification or designation shall be binding for the benefit of the CDC, and such covenants shall run in favor of the CDC for the entire period during which such covenants shall be in force and effect, without regard to whether the CDC is or remains an owner of any land or interest therein to which such covenants relate. The CDC, in the event of any breach of any such covenants, shall have the right to exercise all the rights and remedies and to maintain any actions at law or suits in equity or other proper proceedings to enforce the curing of such breach. 9. Revisions to Grant Deed. Both CDC, its successors and assigns, and Developer and the successors and assigns of Developer in and to all or any part of the fee title to the Site shall have the right with the mutual consent of the CDC to consent and agree to changes in, or to eliminate in whole or in part, any of the covenants, easements or restrictions contained in this Grant Deed without the consent of any tenant, lessee, easement holder, licensee, mortgagee, trustee, beneficiary under a deed of trust or any other person or entity having any interest less than a fee in the Site. However, Developer and CDC are obligated to give written notice to and obtain the consent of any first mortgagee prior to consent or agreement between the parties concerning such changes to this Grant Deed. The covenants contained in this Grant Deed, without regard to technical classification, shall not benefit or be enforceable by any owner of any other real property within or outside the Project Area, or any person or entity having any interest in any other such realty. No amendment to the Redevelopment Plan shall require the consent of the Developer. 10. Enforced Detay; Extension of Times of Performance. In addition to specific provisions of this Agreement, performance by either party hereunder shall not be deemed to be in Default, and all performance and other dates specified in this Agreement shall be extended, where delays or Defaults are due to causes beyond the reasonable control or without the fault of the party claiming an extension of time to perform, which may include the following: war, insurrection; strikes; lockouts; riots; floods; earthquakes; fires; casualties; acts of God; acts of the public enemy, epidemics; quarantine restrictions; freight embargoes; lack of transportation; governmental restrictions or priority; litigation; severe weather; inability to secure necessary labor, materials or tools; delays of any contractor, subcontractor or supplier; acts or omissions of the other party; acts or failures to act of the City or any other public or governmental CDC or entity (other than the acts or failures to act of the CDC which shall not excuse performance by the CDC) (an "Enforced Delay"). Notwithstanding anything to the contrary in this Agreement, an extension of time for any such cause shall be for the period of the Enforced Delay and shall commence to run from the time of the commencement of the cause, if notice by the party claiming such extension is sent to the other party within thirty (30) days of the commencement of the cause. Times of performance under this Agreement may also be extended in writing by the mutual agreement of CDC and Developer. Notwithstanding any provision of this Agreement to the contrary, the lack of funding to complete the Improvements shall not constitute grounds of Enforced Delay pursuant to this Section 10. Attachment No. 3-5 017.262230.5 ATTEST: CDC Secretary APPROVED AS TO FORM: CDC Counsel 017.262230.5 CDC: COMMUNITY DEVELOPMENT COMMISSION OF THE OF THE CITY OF NATIONAL CITY, a public body, corporate and politic By: Nick lnzunza, Chairman MOSSY NISS AN, INC., a California corporation By: By: Philip E. Mossy, President , Secretary Signature Page of Grant Deed Attachment No. 3-6 EXHIBIT "A" LEGAL DESCRIPTION OF SITE Parcel A: (APN: 562-340-47) The northerly 164.00 feet of lot 5 of E. J. Christman Business and Industrial Park I, in the City of National City, County of San Diego, State of California, according to Map thereof No. 8038, Filed in the Office f the County Recorder of San Diego County, November 7, 1974. Parcel B: (APN: 562-340-48) Lot 5 of E. J. Christman Business and Industrial Park I, in the City of National City, County of San Diego, State of California, according to Map thereof No. 8038, Filed in the Office f the County Recorder of San Diego County, November 7, 1974. Excepting therefrom the northerly 164.00 feet. Exhibit A-1 017.262230.5 ATTACHMENT NO. 4 SCHEDULE OF PERFORMANCE GENERAL PROVISIONS 1. Approval and Execution Disposition and Development Agreement ("Agreement") CDC shall consider this Agreement and, if approved, shall authorize, execute and deliver the Agreement to Developer. ACQUISITION AND POSSESSION 2. Acquisition and Possession If appropriate and necessary, CDC may make the necessary findings, conduct appropriate public hearings and take all necessary actions to acquire possession of the Property. 3. Developer Election to Make Possession Deposit 4. Open Escrow If applicable, CDC and Developer shall open an escrow for the purpose of CDC conveying Property to Developer. 5. Satisfy Conditions Precedent CDC and Developer shall satisfy or waive all of their respective Conditions Precedent to Close of Escrow. 6. Close Escrow CDC shall either convey possession and/or fee title to the Property to Developer and Escrow shall close. Attachment No. 4-1 August 23, 2005 August 23, 2005 through December 31, 2007. November 1, 2005 No later than thirty (30) days after CDC possession of the Site or concurrent with Developer election to make Possession Deposit. No later than earlier of thirty (30) days after CDC acquires title to the Property through negotiated purchase or through an Order of Possession and/or Final Order of Condemnation. No later than thirty (30) days after satisfaction or waiver of all Conditions Precedent to Close of Escrow. 017.262230.5 SCHEDULE OF PERFORMANCE CONSTRUCTION 7. Preliminary Design Developer shall complete preliminary design and submit to CDC for review. 8. Preliminary Design Approval CDC shall review, request modifications if necessary and approve preliminary design 9. Construction Drawings and approval Applications Developer shall submit to CDC Construction Drawings, including application materials required by City Planning Services to obtain City approvals for construction of Improvements. 10. Review and Approval Construction Drawings CDC shall review, request modifications if necessary, and approve Construction Drawings. During this period of time, CDC staff and Developer shall hold progress meetings to coordinate preparation, review and modification of Construction Drawings and applications. Building permits shall be issued. 11. Submit final Construction Drawings Developer shall submit its final revision of Construction Drawings. 12. Building Permits Building Permits shall be issued. 13. Commence Construction Developer shall commence construction of the Attachment No. 4-2 No later than sixty (60) days after earlier of (i) CDC obtaining order of possession, or (ii) Close of Escrow. Thirty (30) days after receipt by CDC. One hundred twenty (120) days after earlier of: (i) CDC obtaining order of possession; or (ii) Close of Escrow. Thirty (30) days after CDC receipt of Construction Drawings. Thirty (30) days after receipt of CDC comments. Ninety (90) days after submittal of final construction drawings. Thirty (30) days after receipt of permits. 017.262230.5 017.262230.5 SCHEDULE OF PERFORMANCE Improvements of the Site. 14. Complete Construction Two hundred forty (240) days after commencement of Developer shall complete construction of the construction. Improvements on the Site. Attachment No. 4-3 ATTACHMENT NO. 5 SCOPE OF DEVELOPMENT The Improvements shall consist of new buildings for the Mossy Nissan Dealership, all to be built in accordance with the new Nissan Image Program and shall consist of the following: Approximately 35,000 - 40,000 square feet of new buildings consisting of (a) Showroom/Sales Offices of approximately 6,000 - 8,000 square feet; (b) Service/Detail/Body Shop Bays (approximately 30-40 Bays) of approximately 26,000 square feet; and (c) Parts Department of approximately 8,000 square feet. Attachment No. 5-1 017.262230.5 ATTACHMENT NO. 6 RECORDING REQUESTED BY, ) MAIL TAX STATEMENTS TO AND ) WHEN RECORDED .MAIL TO: ) ) ) ) ) ) ) This document is exempt from payment of a recording fee pursuant to Government Code Section 27383 RELEASE OF CONSTRUCTION COVENANTS THIS RELEASE OF CONSTRUCTION COVENANTS (the `Release") is made by the COMMUNITY DEVELOPMENT COMMISSION OF THE CITY OF NATIONAL CITY, a public body, corporate and politic (the "CDC"), in favor of MOSSY NISSAN, INC., a California corporation (the "Developer"), as of the date set forth below. RECITALS A. The CDC and the Developer have entered into that certain Disposition and Development Agreement (the "DDA") dated concerning the redevelopment of certain real property situated in the City of National City, California as more fully described in Exhibit "A" attached hereto and made a part hereof. B. As referenced in Section 309 of the DDA, the CDC is required to furnish the Developer or its successors with a Release of Construction Covenants upon completion of construction of the Improvements (as defined in Section 100 of the DDA), which Release is required to be in such form as to permit it to be recorded in the Recorder's office of San Diego County. This Release is conclusive determination of satisfactory completion of the construction and development required by the DDA. C. The CDC has conclusively determined that such construction and development has been satisfactorily completed. NOW, THEREFORE, the CDC hereby certifies as follows: 1. The Improvements to be constructed by the Developer have been fully and satisfactorily completed in conformance with the DDA. Any operating requirements and all use, maintenance or nondiscrimination covenants contained in the DDA and other documents executed and recorded pursuant to the DDA shall remain in effect and enforceable according to their terms. 017.262230.5 Attachment No. 6-1 2. Nothing contained in this instrument shall modify in any other way any other provisions of the DDA. IN WITNESS WHEREOF, the CDC has executed this Release this _ day of 200 COMMUNITY DEVELOPMENT COMMISSION OF THE OF THE CITY OF NATIONAL CITY, a public body, corporate and politic By: Nick Inzunza, Chairman ATTEST: , CDC Secretary APPROVED AS TO FORM: CDC Counsel Attachment No. 6-2 017.262230.5 017.262230.5 EXHIBIT "A" SITE DESCRIPTION Parcel A: (APN: 562-340-47) The northerly 164.00 feet of lot 5 of E. J. Christman Business and Industrial Park I, in the City of National City, County of San Diego, State of California, according to Map thereof No. 8038, Filed in the Office f the County Recorder of San Diego County, November 7, 1974. Parcel B: (APN: 562-340-48) Lot 5 of E. J. Christman Business and Industrial Park I, in the City of National City, County of San Diego, State of California according to Map thereof No. 8038, Filed in the Office f the County Recorder of San Diego County, November 7, 1974. Excepting therefrom the northerly 164.00 feet. Exhibit A ATTACHMENT NO. 7 RECORDING REQUESTED BY AND WHEN RECORDED RETURN TO: FOLEY & LARDNER LLP Attn: Richard L. Moskitis 402 West Broadway, Suite 2300 San Diego, California 92101-3542 APNs: 562-340-47 562-340-48 OPERATING COVENANT THIS OPERATING COVENANT is made this day of , 200 , by and between the COMMUNITY DEVELOPMENT COMMISSION OF THE CITY OF NATIONAL CITY, a public body, corporate and politic (the "Agency"), and MOSSY NISSAN, INC., a California corporation (the `Participant"), with reference to the following: A. The Agency and the Participant have executed a Disposition and Development Agreement (the "Agreement"), dated as of July 26, 2005 which provides for the development of certain real property located in the City of National City (the "City"), County of San Diego, State of California, more fully described in Exhibit "A" attached hereto and incorporated herein by this reference (the "Site"). The Agreement is available for public inspection and copying at the office of the Agency, 140 E. 12th Street, Suite B, National City, California. All of the terms, conditions, provisions and covenants of the Agreement are incorporated in this Operating Covenant by reference as though written out at length herein and the Agreement and this Operating Covenant shall be deemed to constitute a single instrument or document. Capitalized terms used herein and not otherwise defined shall have the same meaning as set forth in the Agreement. B. The Agreement provides for, among other things, the Participant's conveyance to the Agency of an operating covenant with respect to the Improvements on the Site (the "Facility"). NOW, THEREFORE, the Participant hereby conveys to the Agency the following Operating Covenant: 1. Operation of Automobile Dealership. For a term commencing upon the date that the City issues a certificate of occupancy for the Facility, and ending upon the tenth anniversary thereof (which ten year period constitutes the "Operating Covenant Period"), the Participant hereby covenants and agrees to operate (or cause its successors or assigns to operate) the Facility on the Site on a continuous basis, devoted to the sale of new automobiles and trucks as a factory - authorized new automobile dealer as the principal activity conducted on the Site. The sale of used automobiles and trucks, and the servicing and repair of vehicles may also be conducted on the Site Attachment No. 7-1 017.262230_5 as a secondary use. In addition, the Participant shall conduct all activities for the leasing of automobiles from the Facility either on the site or at an office located within the City of National City. No other uses may be made on the Site during the Operating Covenant Period without the prior writ -ten approval of the Agency, which approval may be withheld in Agency's sole discretion. The requirements of this Section 1 shall run with the land. 2. Nondiscrimination. The Participant by and for itself and any successors in interest covenants that there shall be no discrimination against or segregation of any person or group of persons on account of race, color, creed, religion, sex, marital status, physical or mental disability or medical condition, national origin or ancestry in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the Site, nor shall the Participant itself or any person claiming under or through it establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees or vendees of the Site. The foregoing covenants shall run with the land. All such deeds, leases or contracts shall contain or be subject to substantially the following nondiscrimination or nonsegregation clauses: i. In deeds: "The grantee herein covenants by and for himself or herself, his or her heirs, executors, administrators and assigns, and all persons claiming under or through them, that there shall be no discrimination against or segregation of, any person or group of persons on account of race, color, creed, religion, sex, marital status, physical or mental disability or medical condition, national origin or ancestry in the sale, lease. sublease, transfer, use, occupancy, tenure or enjoyment of the land herein conveyed, nor shall the grantee himself or herself or any person claiming under or through him or her, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees or vendees in the land herein conveyed. The foregoing covenants shall run with the land." ii. In leases: "The lessee herein covenants by and for himself or herself, his or her heirs, executors, administrators and assigns, and all persons claiming under or through him or her, and this lease is made and accepted upon and subject to the following conditions: "There shall be no discrimination against or segregation of any person or group of persons on account of race, color, creed, religion, sex, marital status, physical or mental disability or medical condition, ancestry or national origin in the leasing, subleasing, transferring, use, occupancy, tenure or enjoyment of the premises herein leased nor shall the lessee himself or herself, or any person claiming under or through him or her, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, sublessees, subtenants or vendees in the premises herein leased." iii. In contracts: "There shall be no discrimination against or segregation of, any person, or group of persons on account of race, color, creed, religion, sex, marital status, physical or mental disability or medical condition, ancestry or national origin, in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the premises, nor shall the transferee himself or herself or any person claiming under or through him or her, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees or vendees of the premises." 017.262230.5 Attachment No. 7-2 This covenant regarding non-discrimination shall remain in effect in perpetuity. 3. Performance of Maintenance. a. Participant shall maintain the Site and the Facility in a first class condition, including, but not limited to, buildings, sidewalks, pedestrian lighting, landscaping, irrigation of landscaping, architectural elements identifying the Site and any and all other improvements on the Site. b. To accomplish the maintenance, Participant shall either staff or contract with and hire licensed and qualified personnel to perform the maintenance work, including the provision of labor, equipment, materials, support facilities, and any and all other items necessary to comply with the requirements of this Operating Covenant. c. The following standards ("Maintenance Standards") shall be complied with by Participant and its maintenance staff, contractors or subcontractors: i. Landscape maintenance shall include, but not be limited to: watering/irrigation; fertilization; mowing; edging; trimming of grass; tree and shrub pruning; trimming and shaping of trees and shrubs to maintain a healthy, natural appearance and safe road conditions and visibility, and irrigation coverage; replacement, as needed, of all plant materials; control of weeds in all planters, shrubs, lawns, ground covers, or other planted areas; and staking for support of trees. ii. Clean-up maintenance shall include, but not be limited to: maintenance of all sidewalks, paths and other paved areas in clean and weed -free condition; maintenance of all such areas clear of dirt, mud, trash, debris or other matter which is unsafe or unsightly; removal of all trash, litter and other debris from improvements and landscaping prior to mowing; clearance and cleaning of all areas maintained prior to the end of the day on which the maintenance operations are performed to ensure that all cuttings, weeds, leaves and other debris are properly disposed of by maintenance workers. iii. All maintenance work shall conform to all applicable federal and state Occupational Safety and Health Act standards and regulations for the performance of maintenance. iv. Any and all chemicals, unhealthful substances, and pesticides used in and during maintenance shall be applied in strict accordance with all governing regulations. Precautionary measures shall be employed recognizing that all areas are open to public access. v. The Site and Facility shall be maintained in conformance and in compliance with the approved Site construction and architectural plans and design scheme, as the same may be amended from time to time with the approval of the City, and reasonable commercial development maintenance standards for similar projects, including, but not limited to: painting and cleaning of all exterior surfaces and other exterior facades comprising all private improvements and public improvements to the curb line. Attachment No. 7-3 017.262230.5 vi. The Site and Facility shall be maintained as required by this Section 3 in good condition and in accordance with the custom and practice generally applicable to comparable automobile dealership facilities located in Southern California. 4. Failure to Maintain Site and Facility. In the event Participant does not maintain the Site or the Facility in the manner set forth herein and in accordance with the Maintenance Standards, Agency and/or City shall have the right to maintain such private and/or public improvements, or to contract for the correction of such deficiencies, after written notice to Participant. However, prior to taking any such action, Agency agrees to notify Participant in writing if the condition of said improvements do not meet with the Maintenance Standards and to specify the deficiencies and the actions required to be taken by Participant to cure the deficiencies. Upon notification of any maintenance deficiency, Participant shall have thirty (30) days within which to correct, remedy or commerce and diligently pursue the cure the deficiency. If the written notification states the problem is urgent relating to the public health and safety of the City or the Agency, then Participant shall have forty-eight (48) hours to rectify the problem. In the event Participant fails to correct, remedy, or cure or has not commenced correcting, remedying or curing such maintenance deficiency after notification and after the period of correction has lapsed, then City and/or Agency shall have the right to maintain such improvements. Participant agrees to pay Agency such charges and costs. Until so paid, the Agency shall have a lien on the Site for the amount of such charges or costs, which lien shall be perfected by the recordation of a `Notice of Claim of Lien" against the Site. Upon recordation of a Notice of a Claim of Lien against the Site, such lien shall constitute a lien on the fee estate in and to the Site prior and superior to all other monetary liens except: (i) all taxes, bonds, assessments, and other levies which, by law, would be superior thereto; (ii) the lien or charge of any mortgage, deed of truss, or their security interest then of record made in good faith and for value, it being understood that the priority of any such lien for costs incurred to comply with this Agreement shall date from the date of the recordation of the Notice of Claim of Lien. Any such lien shall be subject and subordinate to any lease or sublease of the interest of Participant in the Site or any portion thereof and to any casement affecting the Site or any portion thereof entered into at any time (either before or after) the date of recordation of such a Notice. Any lien in favor of the Agency created or claimed hereunder is expressly made subject and subordinate to any mortgage or deed of trust made in good faith and for value, recorded as of the date of the recordation of the Notice of Claim of Lien describing such lien as aforesaid, and no such lien shall in any way defeat, invalidate, or impair the obligation or priority of any such mortgage or deed of trust, unless the mortgage or beneficiary thereunder expressly subordinates his interest, of record, to such lien. No lien in favor of the Agency created or claimed hereunder shall in any way defeat, invalidate, or impair the obligation or priority of any lease, sublease or easement unless such instrument is expressly subordinated to such lien. Upon foreclosure of any mortgage or deed of trust made in good faith and for value and recorded prior to the recordation of any unsatisfied Notice of Claim of Lien, the foreclosure - purchaser shall take title to the Site free of any lien imposed by the Agency that has accrued up to the time of the foreclosure sale, and upon taking title to the Site, such foreclosure -purchaser shall only be obligated to pay costs associated with this Agreement accruing after the foreclosure - purchaser acquires title to the Site. If the Site is ever legally divided with the written approval of the Agency and fee title to various portions of the Site is held under separate ownerships, then the burdens of the maintenance obligations set forth herein and in this Agreement and the charges levied by the Agency to reimburse the Agency for the cost of undertaking such maintenance obligations of Participant and its successors and the lien for such charges shall be apportioned 0117.262230.5 Attachment No. 7-4 among the fee owners of the various portions of the Site under different ownerships according to the square footage of the land contained in the respective portions of the Site owned by them. Upon apportionment, no separate owner of a portion of the Site shall have any liability for the apportioned liabilities of any other separate owner of another portion of the Site, and the lien shall be similarly apportioned and shall only constitute a lien against the portion of the Site owned in fee by the owner who is liable for the apportioned charges levied by the Agency and secured by the apportioned lien and against no other portion of the Site. Participant acknowledges and agrees City and Agency may also pursue any and all other remedies available in law or equity. Participant shall be liable for any and all attorneys' fees, and other legal costs or fees incurred in collecting said maintenance costs. 5. Compliance with Law. Participant shall comply with all local, state and federal laws relating to the uses of or condition of the Site and the Facility. 6. Effect of Violation of the Terms and Provisions of this Operating Covenant. The covenants established in this Operating Covenant shall, without regard to technical classification and designation, be binding for the benefit and in favor of the Agency, its successors and assigns, as to those covenants which are for its benefit. The covenants contained in this Operating Covenant shall remain in effect for the periods of time specified therein. The Agency is deemed the beneficiary of the terms and provisions of this Operating Covenant and of the covenants running with the land, for and in its own rights and for the purposes of protecting the interests of the community and other parties, public or private, in whose favor and for whose benefit this Operating Covenant and the covenants running with the land have been provided. The Operating Covenant and the covenants shall run in favor of the Agency, without regard to whether the Agency has been, remains or is an owner of any land or interest therein in the Site or in the Project Area. The Agency shall have the right, if the Operating Covenant or covenants are breached, to exercise all rights and remedies, and to maintain any actions or suits at law or in equity or other proper proceedings to enforce the curing of such breaches to which it or any other beneficiaries of this Operating Covenant and covenants may be entitled. 7. Miscellaneous Provisions. a. If any provisions of this Operating Covenant or portion thereof, or the application to any person or circumstances, shall to any extent be held invalid, inoperative or unenforceable, the remainder of this Operating Covenant, or the application of such provision or portion thereof to any other persons or circumstances, shall not be affected thereby, it shall not be deemed that any such invalid provision affects the consideration for this Operating Covenant; and each provision of this Operating Covenant shall be valid and enforceable to the fullest extent permitted by law. b. This Operating Covenant shall be construed in accordance with the laws of the State of California. c. This Operating Covenant shall be binding upon and inure to the benefit of the successors and assigns of the Participant. d. In the event action is instituted to enforce any of the provisions of this Operating Covenant, the prevailing party in such action shall be entitled to recover from the other party thereto as part of the judgment, reasonable attorney's fees and costs. Attachment No. 7-5 017.262230.5 IN WITNESS WHEREOF, the parties hereto have executed this instrument the day and year first hereinabove written. ATTEST: , CDC Secretary APPROVED AS TO FORM: CDC Counsel 017.262230.5 AGENCY: COMMUNITY DEVELOPMENT COMMISSION OF THE OF THE CITY OF NATIONAL CITY, a public body, corporate and politic By: Nick Inzunza, Chairman PARTICIPANT: MOSSY NISSAN, INC., a California corporation By: By: Philip E. Mossy, President , Secretary Signature Page of Operating Covenant Attachment No. 7-6 • . v EXHIBIT A LEGAL DESCRIPTION OF SITE Parcel A: (APN: 562-340-47) The northerly 164.00 feet of lot 5 of E. J. Christman Business and Industrial Park I, in the City of National City, County of San Diego, State of California, according to Map thereof No. 8038, Filed in the Office f the County Recorder of San Diego County, November 7, 1974. Parcel B: (APN: 562-340-48) Lot 5 of E. J. Christman Business and Industrial Park I, in the City of National City, County of San Diego, State of California, according to Map thereof No. 8038, Filed in the Office f the County Recorder of San Diego County, November 7, 1974. Excepting therefrom the northerly 164.00 feet. Exhibit A - Page 1 017.262230.5 COMMUNITY DEVELOPMENT COMMISSION OF THE CITY OF NATIONAL CITY August 23, 2005 AGENDA ITEM NO. 4 TO: CHAIRMAN AND BOARD MEMBERS FROM: BENJAMIN MARTINEZ, EXECUTIVE DIRECTOR VIA: BYRON ESTES, DEPUTY DIRECTOR OF REDEVELOPMENT SUBJECT: PUBLIC HEARING AND RESOLUTION NO. 2005-84: PUBLIC HEARING OF THE COMMUNITY DEVELOPMENT COMMISSION TO CONSIDER PUBLIC NECESSITY IN CONJUNCTION WITH THE ACQUISITION OF REAL PROPERTY LOCATED AT 2626 THROUGH 2700 NATIONAL CITY BOULEVARD, AND RESOLUTION OF NECESSITY OF THE COMMUNITY DEVELOPMENT COMMISSION OF THE CITY OF NATIONAL CITY TO ACQUIRE REAL PROPERTY LOCATED AT 2626 THROUGH 2700 NATIONAL CITY BOULEVARD, OWNED BY THE DAILEY FAMILY PARTNERSHIP, BY EMINENT DOMAIN Recommendation: Community Development Commission staff recommends that the Community Development Commission Board: HOLD the Public Hearing of the Community Development Commission to consider public necessity in conjunction with the acquisition Real Property located at 2626 through 2700 National City Boulevard; and, APPROVE Resolution of Necessity of the Community Development Commission of the City of National City to acquire Real Property located at 2626 through 2700 National City Boulevard, owned by the Dailey Family Partnership, by eminent domain. Fiscal Impact: A developer deposit of $7 million will be used for the acquisition from Account 900822. The developer will reimburse all legal and associated fees associated with the project. Community Development Commission Agenda Item No. 4 August 23, 2005 Page 1 of 4 Environmental Impact: The project is consistent with the Certified EIR for the Redevelopment Plan for National City Redevelopment Project certified by Resolution No. 95-98 on June 20, 1995, for the National City General Plan and with the Zoning Designation of Automotive Commercial for the National City Mile of Cars and, consistent with Section 15180 of the California Environmental Quality Act Guidelines, does not require additional analysis. Background: The redevelopment of the National City Redevelopment Project is dependent upon the acquisition of the blighted property that currently exists at 2626-2700 National City Boulevard in the National City Mile of Cars. The Community Development Commission's acquisition agent has attempted to acquire the above referenced property unsuccessfully, and has made an offer of just compensation to the property owner based on the professional appraisal prepared for the Community Development Commission. The subject property, approximately 4.53 acres, is located at 2626-2700 National City Boulevard. The property is blighted as defined by California Redevelopment Law due to inadequate storm water management, excessive solid waste production, obsolete disposal practices for petroleum products and by-products causing the potential for environmental contamination, visual blight and inadequate on and off -site traffic management. It is in the best public interest with the least injury that the site be acquired to allow for the elimination of blight, the opportunity for redevelopment, the creation of additional jobs, and the increase of public benefit. No other location in the National City Mile of Cars is available for the project. The project will include the redevelopment of Mossy Nissan, including the demolition of most of the current improvements and reconstruction of state-of-the-art facilities and equipment. A new storm water management system will be installed which will catch surface grease, solid debris and contaminates for on -site treatment prior to release into the City of National City's storm drains. Increased recycling facilities will be constructed to reduce the production of solid waste and state- of-the-art new and used oil systems and practices will be put in place. Interior traffic parking and stacking will be designed to increased traffic and pedestrian safety for those walking and driving in the area and new pedestrian and directional signage will be installed. The use of eminent domain to facilitate redevelopment is necessary and appropriate. The developer was unable to acquire the site after more than 18-months of diligent effort including the Community Development Commission's attempt to facilitate those efforts by providing an independent appraisal. The site is the only one currently useable for the project in National City and the project is required by Nissan Corporation to be Community Development Commission Agenda Item No. 4 August 23, 2005 Page 2 of 4 completed by Mossy within 24 months. Mossy Nissan has stated that if it cannot acquire the site based upon reasonable terms and upon the appraised value of the site, they would be compelled to give serious consideration to moving the dealership out of National City. Mossy Nissan currently provides more than $1 million in tax support to the City of National City and the Community Development Commission. The project would result in an increase of $200,000 -$300,000 in annual sales tax revenue to the City of National City by 2010 and would increase the Community Development Commission's revenue in property tax increment by $100,000 per year. Additionally, Mossy intends to add 25 new employees as the result of this project. In order for the Community Development Commission to exercise its power of eminent domain the Community Development Commission must first conduct a Public Hearing of Necessity at which the property owners are entitled to appear and voice their concerns on the following issues: 1. Does the public interest and necessity require the project? The proposed action will redevelop and improve the existing business activity on the site and will not eliminate any current business operation or any jobs. The site is the only one in National City useable for the project and completion of the project will add 25 jobs for National City and South Bay residents. It will eliminate obsolete environmental practices currently existing and allow the construction of state-of-the- art storm water management and petroleum disposal systems. It will also improve traffic circulation and pedestrian safety by reducing on -street customer and delivery parking through improved site design and the installation of improved directional signage. It will eliminate visual blight. It will further allow increased sales of new motor vehicles in the National City Mile of Cars, providing increased revenues to the City of National City and the Community Development Commission with which to provide public services and facilities. The acquisition will allow the above improvements in a way that is most compatible with the greatest public good and is consistent with the National City Redevelopment Plan. 2. Is the project planned or located in a manner that will be most compatible with the greatest public good and the least private injury? The proposed action for condemnation of the parcels included at 2626-2700 National City Boulevard is within the National City Mile of Cars sub -area of the National City Redevelopment Project and is consistent with the National City Redevelopment Plan. The assemblage of property interests and the elimination of environmental, visual and other blighting conditions will improve the neighborhood and the quality of life for residents, visitors, property owners and tenants of this area, consistent with furthering redevelopment goals. All aspects of the public good, including but not limited to social, economic, environmental and aesthetic considerations mandate the implementation of this project. The property owner will Community Development Commission Agenda Item No. 4 August 23, 2005 Page 3 of 4 be paid fair market value for the property, based upon an appraisal prepared by an appraiser retained by the Community Development Commission. 3. Is the property to be acquired necessary for the project? The acquisition of the parcels is necessary because no other parcels in National City are reasonably suitable for this project. Fee simple acquisition is necessary because of the size and cost of the permanent structures. Failure of Mossy Nissan to acquire the property may result in the dealership being compelled to move out of National City. 4. The offer required by Section 7267.2 of the Government Code has been made to the owner of record on July 22, 2005 without any written response. The offer was based on an independent appraisal, with such appraisal being approved and is in the full amount so determined. Representatives of the Daily Family Partnership recommended the independent appraiser selected. 5. The use for which any publicly owned parcels are to be taken is a more necessary public use than the property is currently appropriated and the taking as to any publicly owned parcels is for a more necessary public use consistent with and authorized by Code of Civil Procedure Section 1240.610. The property owner has the opportunity to address these issues at the Public Hearing of Necessity held in conjunction with the consideration of this Resolution. The purpose of the Hearing is not to address the amount of compensation to be paid to the property owner. Attached hereto is a copy of the Notice of Intent to Adopt Resolution of Necessity to Acquire Certain Retail Property by Eminent Domain (Code of Civil Procedure, Section 1245.235) sent to Mr. and Mrs. Lawrence F. Dailey) ATTACHMENTS: Exhibit — 1 Resolution No. 2005-84 Exhibit — 2 Legal description Exhibit — 3 Site map Exhibit — 4 Notice of Intent Staff member: Beard Community Development Commission Agenda Item No. 4 August 23, 2005 Page 4 of 4 RESOLUTION NO. 2005-84 A RESOLUTION OF NECESSITY OF THE COMMUNITY DEVELOPMENT COMMISSION OF THE CITY NATIONAL CITY (CDC) TO ACQUIRE REAL PROPERTY LOCATED AT 2626 THROUGH 2700 NATIONAL CITY BOULEVARD, OWNED BY THE DAILEY FAMILY PARTNERSHIP, BY EMINENT DOMAIN WHEREAS, the City Council of the City of National City, by adoption of Ordinance No. 95-2095 on July 18, 1995, approved and adopted the Redevelopment Plan for the National City Redevelopment Project; and, WHEREAS, said Redevelopment Plan provides for the acquisition of real property, if necessary by eminent domain, including the real property commonly known as 2626 through 2700 National City Blvd., National City, California, more particularly described in Exhibit "A" attached hereto and depicted in the Map attached herein: and, WHEREAS, the Community Development Commission of the City of National City has served The Daily Family Partnership, the owners of the real property located at 2626 through 2700 National City Blvd., National City, California with a Notice of Intent to Adopt a Resolution of Necessity to Acquire Real Property by Eminent Domain as required by California Code of Civil Procedure, Section 1245.235. A copy of the Notice is attached hereto as Exhibit "B"; and, WHEREAS, pursuant to the above referenced Notice, the Community Development Commission of the City of National City held a hearing on August 23, 2005, in the City Council Chambers, 1243 National City Boulevard, National City, California, to consider acquiring the real property at 2626 through 2700 National City Blvd., National City, California, by eminent domain, for redevelopment purposes and provided all persons a reasonable opportunity to appear and be heard on the matters in Section 1240.030 of the California Code of Civil Procedure. NOW, THEREFORE, BE IT RESOLVED that the Community Development Commission of the City of National City, by a vote of two-thirds or more of its members, hereby finds, determines, declares and resolves as follows: I. That the public interest, convenience and necessity require the proposed project; and, II. That project is planned or located in a manner that will be most compatible with the greatest public good and the least private injury; and, EXHIBIT 1 i III. The property to be acquired as described herein is necessary for the proposed project; and, IV. The offer required by Government Code Section 7267.2 together with an appraisal summary statement has been made to the owners of record which offer and appraisal summary statement were in a form and contained all of the disclosures required. (No evidence was presented contending the appraisal summary statement was inadequate as a matter of law); and, V. The real property to be taken is generally described as a portion of 2626 through 2700 National City Blvd., National City, California and is more particularly described in Exhibit "A" attached hereto and made a part hereof which takes precedence over all other descriptions. A map depicting the location of the property is also attached to Exhibit "A"; and, VI. All conditions and statutory requirement necessary to exercise the power of eminent domain ("the right to take") to acquire the property for the Project have been complied with by the Commission; and, VII. The Commission further finds and declares: a. The acquisition of the subject parcel is in conformity with the National City Redevelopment Project. b. The proposed acquisition for redevelopment of this site is planned in accordance with the National City Redevelopment Project and that the acquisition is necessary for the removal of blighting conditions and influences and to facilitate the redevelopment of property within the Project area. c. That said acquisition has been preceded by the review, adoption and certification of all appropriate environmental documents and reports. BE IT FURTHER RESOLVED, that the legal counsel for the Community Development Commission of the City of National City is hereby authorized and directed to commence such actions and proceedings of eminent domain in the Superior Court of the State of California, County of San Diego, as are necessary to acquire in fee, for the purpose and uses aforesaid, that certain real property commonly known as 2626 through 2700 National City Blvd., which is situated in the City of National City, and within the County of San Diego, State of California. BE IT FURTHER RESOLVED, that the taking of said real property for redevelopment purposes, specifically, is authorized by Health and Safety Code Sections 33000, 333020, 333021, 33342, 33391, 33392 and 33691 and is a public use. 2 BE IT FURTHER RESOLVED, that Sections 1240.010, 1240.110, 1240.210, 1240.510 and 1240.610 of the California Code of Civil Procedure, and Sections 37350.5 of the Government Code permit the acquisition referenced herein and are relied upon herein as authority for these proceedings. PASSED AND ADOPTED this 23rd day of August 2005. ATTEST: By: Ben Martinez, Executive Director APPROVED AS TO FORM: By: George H. Eiser, III, City/CDC Attorney By: Nick Inzunza, Chairman 3 SITE LEGAL DESCRIPTION Parcel A: (APN: 562-340-47) The northerly 164.00 feet of lot 5 of E.J. Christman Business and Industrial Park I, in the City of National City, County of San Diego, State of California, according to Map thereof No. 8038, Filed in the Office of the County Recorder of San Diego County, November 7, 1974 Parcel B: (APN: 562-=40-48) Lot 5 of E.J. Christman Business and Industrial Park I, in the City of National. City, County of San Diego, State of California, according to Map thereof No. 8038, Filed in the Office of the County Recorder of San Diego County, November 7, 1974. Excepting therefrom the northerly 164.00 feet EXHIBIT "A" as 9 r4� ' L Ogg 1 i HAROING AVE-f-' I 22NO MILES -OF -CARS' swwio ..raw•• was ynwe Y/. 1, 01 art- cQab•°a l G sX®2 s 1M,Nt 1M ttY.it,ew~ 4B a ts ® n -4* 28TH a b sT i Arno 28TH 0 ST Y ei _Ara •A'YY'Y )l i' 124TH a JAP-.34 ROOSEVELT-... I IIAYEI 1K wur AAA. xCIE 43 a' dm .2: Y'-y a ST AM Iwf1110 Mra •�t'Wt A® Pats e ®! 25TH Sw'«'.. ST n waw r art* `r p e f r Y a�®R® 0 gq 3 m a a j iVS soar, e 3 RR J N®e `�, NV//JIUU rwnae-MlX�� -- 4 a ST) 1 WAY aro 28TH ST Itm„ 27 H L\% 28TH 'ImuccI3"1 , ,iii■ .. IIIII BI010100 op al Hila0raa i a 1l8' f 1111fC01 » J JU] ]]T0 a ST 4- N.r A 08/09/2005 14:50 FAX 6192359100 Don Detisch t 006/006 Parcel A: (APN: 562-340-47) SITE LEGAL DESCRIPTION The northerly 164.00 feet of lot 5 of E.J. Christman Business and Industrial Park I, in the City of National City, County of San Diego, State of California, according to Map thereof No. 8038, Filed in the Office of the County Recorder of San Diego County, November 7, 1974 Parcel B: (APN: 562-3 40-48) Lot 5 of E.J. Christman Business and Industrial Park I, in the City of National City, County of San Diego, State of California, according to Map thereof No. 8038, Filed in the Office of the County Recorder of San Diego County, November 7, 1974. Excepting therefrom the northerly 164.00 feet EXHIBIT "A" EXHIBIT 2 118/09/2005 TUE 15:50 [JOB NO. 5952] a006 i 1-80=45 03-7334 ,,,,,,,, 111� „ 'al ,,,,,,i,5 1 SCALE ALVU OF Min 06 Agn v YMI ZPAR 2.77 AC ..u'n'., PM2347 0 s �FR PM4 8 R 2b ...iT'nn• 14 14 Q • 0PAR I z 5.44 AC 7AN 2790 501A1, 45I550.3 MA` et, Ma 4RA34 4 } 1- v ir!b areas I NATION ',Au.! a♦ Ann 0 4 A TRANSPORTATION CITY 0 BLVDN v N l lA.� PY 7424 •• l~4 79 ! PM] = A' !AA JN = Li; e 7. ro J PM4 NC."' 4!f AVE 4 (AVE) SIIq'Yf 582-34 .4 (COOLIDGE) J y1y a 2' SO PM79jr +'+, x 34.4 saw., 1..:. O, 33144 7M 2 PM 1 _4; 21 y yE i tdPM . 7 • 0038 OA 348 MAW ASSAEO RM PERM MIPAC/ Q M SIATA m A5 ro 144171.15 m M.7 PT mar 9101 4,CAL RAN601 01 MPG CORMS I6 n 1,_ LMK 441.19. 41 PAR PM2 ALA xW1 a rum PoI973A ALRs2 AA7 Iw 8 51 I.©=�444 R LK PM 1 91 Rui 2 R MR 3 7 a 1I 1.Mo91LE HONE } 7 nt R ; 1 ^y vs, 1 AAA kj m "—'M 79 _nb+ Vx9 AVE E E 8 ,tom 1 'evn �x7. Vrw = FOR 18 y ; mot! 9 PMrzw H 17 °'wK0 O i- O ry N 11,AC + �MIP_M 1.74AC E25K ��/Y� by .. Sh^.I.HPORTALCPWAY.1r 7 2 4+ !i es PM1440 M12s a. 11 8 v 041 2O 7 PAR1 ;S PARE xp O E^ O zo1M • L7eK !nn 411 2 2 '*13 4 1 gY 1 IHOOJER AVE a EHARDING WE. sonnet* sr CHANGE 2 1,15-415-4-11 MAP 348-NATIONAL CITY MAP 8038-E.I. CHRISTMAN BUSINESS AND INDUSTRIAL PARK I ROS 13498 .11N 0 52009 Exhibit 3 — Site map [////////////////] 4 EXHIBIT 3 NOTICE OF INTENT TO ADOPT RESOLUTION OF NECESSITY TO ACQUIRE CERTAIN REAL PROPERTY BY EMINENT DOMAIN (Code of Civil Procedure, Section 1245.235) TO: Mr. and Mrs. Lawrence F. Dailey 3959 Acacia Avenue Bonita, CA 91902 Pursuant to the provisions of the California Code of Civil Procedure, Section 1245.235, you have been identified as an owner of certain real property, or interest therein, consisting of the real property and improvements located at 2626 and 2700 National City Boulevard, National City, California 91950, which is proposed to be acquired by the Community Development Commission of the City of National City for redevelopment purposes. California Code of Civil Procedure, Section 1240.030 provides that the power of eminent domain may be exercised to acquire property for a proposed project only if the following conditions are established: a. The public interest and necessity require the project. b. The project is planned or located in the manner that will most compatible with the greatest public good and the least private injury. c. The property sought to be acquired is necessary for the project. You are hereby notified that it is the intent of the Community Development Commission of the City of National City, at a hearing to be held on August 23, 2005 at 6:00 p.m. in the City Council Chambers, 1243 National City Boulevard, National City, California 91950, to adopt a Resolution of Necessity to Acquire by Eminent Domain. Said resolution will authorize the Community Development Commission of the City of National City to acquire your real property, or interest therein, for redevelopment Page 1 of 2 EXHIBIT 4 purposes, specifically new automobile sales facility and related uses, by the exercise of power of eminent domain, as authorized by Health and Safety Code Sections 33342 and 33391. You are further notified that if you file a written request to appear and be heard within fifteen (15) days of the mailing of this notice, you will have the right to appear and be heard concerning the above -quoted conditions set forth in California Code of Civil Procedure 1240.030 as they relate to the intent of the Community Development Commission of the City of National City to acquire your property. Failure to file a written request to appear and be heard by August 22, 2005, will result in a waiver of your right to appear and be heard. Your written request must actually be on file with the Executive Director of the Community Development Commission of the City of National City, on the above -indicated filing date. Mere deposit of your request in the mail within this time limitation will not suffice to avoid waiver. All such requests to appear and be heard must be filed with the Executive Director of the Community Development Commission of the City of National City, 140 East 12`h Street, Suite B, National City, California 91950. For your convenience, the Board of the Community Development Commission of the City of National City will consider any written comments you may wish to submit to it, pursuant to this notice in lieu of your personal appearance at the hearing. Dated: August 1, 2f.105 By: njamin Martinez, Executive Director Page 2 of 2 GEORGE H. EISER, III (No. 065706) City/CDC Attorney COMMUNITY DEVELOPMENT COMMISSION OF THE CITY OF NATIONAL CITY 140 E. 12th Street, Suite B National City, California 91950 Telephone (619) 336-4250 Facsimile: (619) 336-4286 PROOF OF SERVICE [CCP 1013A (3)] I, the undersigned, am employed in the County of San Diego, State of California. I am over the age of 18 and not a party to the within action; my business is at 140 E. 12th Street, Suite B, National City, CA 91950. On August 1, 2005 I served the foregoing document(s) described as NOTICE OF INTENT TO ADOPT A RESOLUTION OF NECESSITY TO ACQUIRE CERTAIN REAL PROPERTY BY EMINENT DOMAIN on the parties in this action by placing true copies in a sealed envelope addressed as follows: Mr. and Mrs. Lawrence F. Dailey 3959 Acacia Avenue Bonita, CA 91902 [X] BY MAIL — as follows: I am "readily familiar" with the firm's practice of collection and processing correspondence for mailing. Under that practice it would be deposited with the U.S. Postal Service on that same day with postage thereon fully prepaid at National City, California in the ordinary course of business. The envelope was sealed and placed for collection and mailing on this date following our ordinary practices. I am aware that on motion of the party served, service is presumed invalid if postal cancellation date or postage meter date is more than one day after the date of deposit for mailing an affidavit. [ ] BY FAX — as follows: I personally sent to the addressee's telecopier number a true copy of the above -described documents. Thereafter I sent a true copy in a sealed envelope addressed and mailed as indicated above. Executed on August 1, 2005 at National City California. I declare under penalty of perjury under the laws of the State of California that the foregoing is true and correct. ELIZABETH CUMMING COMMUNITY DEVELOPMENT COMMISSION OF THE CITY OF NATIONAL CITY August 23, 2005 AGENDA ITEM NO. 5 TO: CHAIRMAN AND BOARD MEMBERS FROM: BENJAMIN MARTINEZ, EXECUTIVE DIRECTOR SUBJECT: RESOLUTION NO. 2005-85: AUTHORIZING THE EXPENDITURE OF FUNDS FOR OFFICE REMODELING SERVICES AND AUTHORIZING THE EXECUTIVE DIRECTOR TO ENTER INTO AN AGREEMENT WITH OFFICE PAVILION FOR OFFICE REMODELING SERVICES Recommendation: Community Development Commission staff recommends that the Community Development Commission Board: APPROVE Resolution No. 2005-85 authorizing the expenditure of funds for office remodeling services and authorizing the Executive Director to enter into an Agreement with Office Pavilion for office remodeling services. Fiscal Impact: Funds in the amount of $62,171 are available and budgeted under Furniture and Furnishing in account number 360-461-505-503. Environmental Impact: CEQA is not applicable. Background: During the last year the amount of redevelopment activity has increased significantly creating a constant stream of visitors including builders, contractors, interested residents and developers. The Community Development Commission will "piggy back" the order for furniture and installation on the existing order and contract the library has with Office Pavilion. Cooperative purchasing is authorized by Section 2.60.260 of the Municipal Code. Community Development Commission Agenda Item No. 5 August 23, 2005 Page 1 of 2 Due to an enormous increase in development activities, the Community Development Commission office requires additional closed office space and several additional offices for new and future employees. The Community Development Commission office environment necessitates an urgent need to upgrade and remodel the interior office space to accommodate a changed clientele and professional atmosphere. The Community Development Commission will make every effort to integrate existing office furniture into the process of the remodel. The remodel serves three purposes: to enhance the general appearance of the office, create more offices for additional personnel and create a better overall and open atmosphere for access to the office by clientele. The Community Development Commission has considered other alternatives to this partial office remodel. One solution would be to relocate offices entirely, however, in consideration of the space the Community Development Commission requires and the need for proximity to City Hall, the Community Development Commission has not been able to locate appropriate available space. With this, staff recommends that the Community Development Commission Board authorize the expenditures of funds for office remodeling services and authorize the Executive Director to enter into an Agreement with Office Pavilion for office remodeling services. ATTACHMENTS: Exhibit 1 — Resolution 2005-85 Exhibit 2 — Office Pavilion Agreement Staff Member: Cumming Community Development Commission August 23, 2005 Agenda Item No. 5 Page 2 of 2 RESOLUTION NO. 2005-85 A RESOLUTION OF THE COMMUNITY DEVELOPMENT COMMISSION OF THE CITY NATIONAL CITY (CDC) AUTHORIZING THE EXPENDITURE OF FUNDS FOR OFFICE REMODELING SERVICES AND AUTHORIZING THE EXECUTIVE DIRECTOR TO ENTER INTO AN AGREEMENT WITH OFFICE PAVILION FOR OFFICE REMODELING SERVICES WHEREAS, the Community Development Commission of National City has the need for an office upgrade and remodel to include reconfigured office space and work areas to include product and assembly; and, WHEREAS, cooperative purchasing is authorized by Section 2.60.260 of the Municipal Code; and WHEREAS, funds in the amount of $62,171 are available and budgeted under furniture and furnishings in account number 360-461-505-503 and will piggy back on the existing public bid contract AG0276 used by the City of National City. NOW, THEREFORE, BE IT RESOLVED, that the Community Development Commission of National City hereby approves the Agreement with Office Pavilion for office design, product assembly and installation related to the terms and conditions set forth in the agreement. BE IT FURTHERED RESOLVED, that the Community Development Commission of National City authorizes the expenditure of funds for office remodeling services and authorizes the Executive Director to execute the Agreement with Office Pavilion for office remodeling services. PASSED AND ADOPTED this 23`d day of August 2005. ATTEST: Benjamin Martinez, Secretary APPROVED AS TO FORM: George H. Eiser, III, City -CDC Attorney Nick Inzunza, Chairman EXHIBIT 1 AGREEMENT BY AND BETWEEN THE COMMUNITY DEVELOPMENT COMMISSION OF THE CITY OF NATIONAL CITY AND OFFICE PAVILION THIS AGREEMENT is entered into this 9th day of August 2005, by and between the COMMUNITY DEVELOPMENT COMMISSION OF THE CITY OF NATIONAL CITY, a municipal corporation (the "CDC"), and OFFICE PAVILION (the "CONTRACTOR"). RECITALS WHEREAS, the CDC desires to employ a CONTRACTOR to Provide Product and Inside Office and Product Assembly, and to supply an order for furniture and installation on the same price, terms and conditions the existing contract the National City Library has with Office Pavilion. WHEREAS, the CDC has determined that the CONTRACTOR is an Interior Office Design Planning Firm and is qualified by experience and ability to perform the services desired by the CDC, and the CONTRACTOR is willing to perform such services. NOW, THEREFORE, THE PARTIES HERETO DO MUTUALLY AGREE AS FOLLOWS: 1. ENGAGEMENT OF CONTRACTOR. The CDC hereby agrees to engage the CONTRACTOR and the CONTRACTOR hereby agrees to perform the services hereinafter set forth in accordance with all terms and conditions contained herein. The CONTRACTOR represents that all services required hereunder will be performed directly by the CONTRACTOR or under direct supervision of the CONTRACTOR. 2. SCOPE OF SERVICES. The CONTRACTOR will perform services, and sell the furniture and equipment, as set forth in the attached Exhibit "A". The CONTRACTOR shall be responsible for the design, ordering of product, and assembly of product related to the work and shall not rely on personnel of the CDC for such services, except as authorized in advance by the CDC. The CDC may unilaterally, or upon request from the CONTRACTOR, from time to time reduce or increase the Scope of Services to be performed by the CONTRACTOR under this Agreement. Upon doing so, the CDC and the CONTRACTOR agree to meet in good faith and confer for the purpose of negotiating a corresponding reduction or increase in the compensation associated with said change in services, not to exceed a factor of 10% from the base amount. EXHIBIT 2 3. PROJECT COORDINATION AND SUPERVISION. Elizabeth Cumming hereby is designated as the Project Coordinator for the CDC and will monitor the progress and execution of this Agreement. The CONTRACTOR shall assign a single Project Director to provide supervision and have overall responsibility for the progress and execution of this Agreement for the CONTRACTOR. Elizabeth Cumming thereby is designated as the Project Director for the CONTRACTOR. 4. COMPENSATION AND PAYMENT. The compensation for the CONTRACTOR shall be based on monthly billings covering actual work performed. Billings shall include labor classifications, respective rates, hours worked and also materials, if any. The total cost for all work described in Exhibit "A" shall not exceed $62,171 without prior written authorization from the City of National City Community Development Commission. Monthly invoices will be processed for payment and remitted within thirty (30) days from receipt of invoice, provided that work is accomplished consistent with Exhibit "A" as determined by the CDC. The CONTRACTOR shall maintain all books, documents, papers, employee time sheets, accounting records, and other evidence pertaining to costs incurred and shall make such materials available at its office at all reasonable times during the term of this Agreement and for three (3) years from the date of final payment under this Agreement, for inspection by the CDC and for furnishing of copies to the CDC, if requested. 5. LENGTH OF AGREEMENT. Completion dates or time durations for specific portions of the Project are set forth in Exhibit "A." 6. DISPOSITION AND OWNERSHIP OF DOCUMENTS. The Memoranda, Reports, Maps, Drawings, Plans, Specifications and other documents prepared by the CONTRACTOR for this Project, whether paper or electronic, shall become the property of the CDC for use with respect to this Project, and shall be turned over to the CDC upon completion of the Project, or any phase thereof, as contemplated by this Agreement. Contemporaneously with the transfer of documents, the CONTRACTOR hereby assigns to the CDC and CONTRACTOR thereby expressly waives and disclaims, any copyright in, and the right to reproduce, all written material, drawings, plans, specifications or other work prepared under this agreement, except upon the CDC's prior authorization regarding reproduction, which authorization shall not be unreasonably withheld. The CONTRACTOR shall, upon request of the CDC, execute any further document(s) necessary to further effectuate this waiver and disclaimer. The CONTRACTOR agrees that the CDC may use, reuse, alter, reproduce, modify, assign, transfer, or in any other way, medium or method utilize the CONTRACTOR's written work product for the CDC's purposes, and the CONTRACTOR expressly waives and disclaims any residual rights granted to it by Civil Code Sections 980 through 989 relating to intellectual property and artistic works. 2 Any modification or reuse by the CDC of documents, drawings or specifications prepared by the CONTRACTOR shall relieve the CONTRACTOR from liability under Section 14 but only with respect to the effect of the modification or reuse by the CDC, or for any liability to the CDC should the documents be used by the CDC for some project other than what was expressly agreed upon within the Scope of this project, unless otherwise mutually agreed. 7. INDEPENDENT CONTRACTOR. Both parties hereto in the performance of this Agreement will be acting in an independent capacity and not as agents, employees, partners or joint venturers with one another. Neither the CONTRACTOR nor the CONTRACTOR'S employees are employee of the CDC and are not entitled to any of the rights, benefits, or privileges of the CDC's employees, including but not limited to retirement, medical, unemployment, or workers' compensation insurance. This Agreement contemplates the personal services of the CONTRACTOR and the CONTRACTOR's employees, and it is recognized by the parties that a substantial inducement to the CDC for entering into this Agreement was, and is, the professional reputation and competence of the CONTRACTOR and its employees. Neither this Agreement nor any interest herein may be assigned by the CONTRACTOR without the prior written consent of the CDC. Nothing herein contained is intended to prevent the CONTRACTOR from employing or hiring as many employees, or subcontractors, as the CONTRACTOR may deem necessary for the proper and efficient performance of this Agreement. All agreements by CONTRACTOR with its subcontractor(s) shall require the subcontractor to adhere to the applicable terms of this Agreement. 8. CONTROL. Neither the CDC nor its officers, agents or employees shall have any control over the conduct of the CONTRACTOR or any of the CONTRACTOR's employees except as herein set forth, and the CONTRACTOR expressly agrees not to represent that the CONTRACTOR or the CONTRACTOR's agents, servants, or employees are in any manner agents, servants or employees of the CDC, it being understood that the CONTRACTOR, its agents, servants, and employees are as to the CDC wholly independent contractors and that the CONTRACTOR's obligations to the CDC are solely such as are prescribed by this Agreement. 9. COMPLIANCE WITH APPLICABLE LAW. The CONTRACTOR, in the performance of the services to be provided herein, shall comply with all applicable State and Federal statutes and regulations, and all applicable ordinances, rules and regulations of the City of National City, whether now in force or subsequently enacted. The CONTRACTOR, and each of its subcontractors, shall obtain and maintain a current City of National City business license prior to and during performance of any work pursuant to this Agreement. 10. LICENSES, PERMITS, ETC. The CONTRACTOR represents and covenants that it has all licenses, permits, qualifications, and approvals of whatever nature that are legally required to practice its profession. The CONTRACTOR represents and covenants that the CONTRACTOR shall, at its sole cost and expense, keep in effect at all times during the term of this Agreement, any license, permit, or approval which is legally required for the CONTRACTOR to practice its profession. 3 11. STANDARD OF CARE. A. The CONTRACTOR, in performing any services under this Agreement, shall perform in a manner consistent with that level of care and skill ordinarily exercised by members of the CONTRACTOR'S trade or profession currently practicing under similar conditions and in similar locations. The CONTRACTOR shall take all special precautions necessary to protect the CONTRACTOR's employees and members of the public from risk of harm arising out of the nature of the work and/or the conditions of the work site. B. Unless disclosed in writing prior to the date of this agreement, the CONTRACTOR warrants to the CDC that it is not now, nor has it for the five (5) years preceding, been debarred by a governmental agency or involved in debarment, arbitration or litigation proceedings concerning the CONTRACTOR's professional performance or the furnishing of materials or services relating thereto. C. The CONTRACTOR is responsible for identifying any unique products, treatments, processes or materials whose availability is critical to the success of the project the CONTRACTOR has been retained to perform, within the time requirements of the CDC, or, when no time is specified, then within a commercially reasonable time. Accordingly, unless the CONTRACTOR has notified the CDC otherwise, the CONTRACTOR warrants that all products, materials, processes or treatments identified in the project documents prepared for the CDC are reasonably commercially available. Any failure by the CONTRACTOR to use due diligence under this sub -paragraph will render the CONTRACTOR liable to the CDC for any increased costs that result from the CDC's later inability to obtain the specified items or any reasonable substitute within a price range that allows for project completion in the time frame specified or, when not specified, then within a commercially reasonable time. 12. NON-DISCRIMINATION PROVISIONS. The CONTRACTOR shall not discriminate against any employee or applicant for employment because of age, race, color, ancestry, religion, sex, sexual orientation, marital status, national origin, physical handicap, or medical condition. The CONTRACTOR will take positive action to insure that applicants are employed without regard to their age, race, color, ancestry, religion, sex, sexual orientation, marital status, national origin, physical handicap, or medical condition. Such action shall include but not be limited to the following: employment, upgrading, demotion, transfer, recruitment or recruitment advertising, layoff or termination, rates of pay or other forms of compensation, and selection for training, including apprenticeship. The CONTRACTOR agrees to post in conspicuous places available to employees and applicants for employment any notices provided by the CDC setting forth the provisions of this non-discrimination clause. 13. CONFIDENTIAL INFORMATION. The CDC may from time to time communicate to the CONTRACTOR certain confidential information to enable the CONTRACTOR to effectively perform the services to be provided herein. The CONTRACTOR shall treat all such information as confidential and shall not disclose any part thereof without the prior written consent of the CDC. The CONTRACTOR shall limit the use and circulation of such information, even within its own organization, to the extent necessary to perform the services to be provided herein. The foregoing obligation of this Section 13, however, shall not apply to any part of the information that (i) has been disclosed in publicly available sources of information; (ii) is, through no fault of the CONTRACTOR, hereafter disclosed in publicly available sources of information; 4 (iii) is already in the possession of the CONTRACTOR without any obligation of confidentiality; or (iv) has been or is hereafter rightfully disclosed to the CONTRACTOR by a third party, but only to the extent that the use or disclosure thereof has been or is rightfully authorized by that third party. The CONTRACTOR shall not disclose any reports, recommendations, conclusions or other results of the services or the existence of the subject matter of this Agreement without the prior written consent of the CDC. In its performance hereunder, the CONTRACTOR shall comply with all legal obligations it may now or hereafter have respecting the information or other property of any other person, firm or corporation. CONTRACTOR shall be liable to CDC for any damages caused by breach of this condition, pursuant to the provisions of Section 14. 14. INDEMNIFICATION AND HOLD HARMLESS. The CONTRACTOR agrees to defend, indemnify, and hold harmless the Community Development Commission of the City of National City, its officers and employees, against and from any and all liability, loss, damages to property, injuries to, or death of any person or persons, and all claims, demands, suits, actions, proceedings, reasonable attorneys' fees, and defense costs, of any kind or nature, including workers' compensation claims, of or by anyone whomsoever, resulting from or arising out of the CONTRACTOR's negligent performance of this Agreement. 15. WORKERS' COMPENSATION. The CONTRACTOR shall comply with all of the provisions of the Workers' Compensation Insurance and Safety Acts of the State of California, the applicable provisions of Division 4 and 5 of the California Government Code and all amendments thereto; and all similar state or Federal acts or laws applicable; and shall indemnify, and hold harmless the CDC and its officers, and employees from and against all claims, demands, payments, suits, actions, proceedings and judgments of every nature and description, including reasonable attorney's fees and defense costs presented, brought or recovered against the CDC or its officers, employees, or volunteers, for or on account of any liability under any of said acts which may be incurred by reason of any work to be performed by the CONTRACTOR under this Agreement. 16. INSURANCE. The CONTRACTOR, at its sole cost and expense, shall purchase and maintain, and shall require its subcontractors, when applicable, to purchase and maintain throughout the term of this agreement, the following insurance policies: ❑ A. If checked, Professional Liability Insurance (errors and omissions) with minimum limits of $1,000,000 per occurrence. B. Automobile insurance covering all bodily injury and property damage incurred during the performance of this Agreement, with a minimum coverage of $1,000,000 combined single limit per accident. Such automobile insurance shall include non -owned vehicles. C. Comprehensive general liability insurance, with minimum limits of $1,000,000 combined single limit per occurrence, covering all bodily injury and property damage arising out of its operation under this Agreement. D. Workers' compensation insurance covering all of CONSULTANT's employees. 5 E. The aforesaid policies shall constitute primary insurance as to the CDC, its officers, employees, and volunteers, so that any other policies held by the CDC shall not contribute to any loss under said insurance. Said policies shall provide for thirty (30) days prior written notice to the CDC of cancellation or material change. F. Said policies, except for the professional liability and worker's compensation policies, shall name the CDC and its officers, agents and employees as additional insureds. G. If required insurance coverage is provided on a "claims made" rather than "occurrence" form, the CONTRACTOR shall maintain such insurance coverage for three years after expiration of the term (and any extensions) of this Agree- ment. H. Any aggregate insurance limits must apply solely to this Agree- ment. I. Insurance shall be written with only California admitted companies which hold a current policy holder's alphabetic and financial size category rating of not less than A VIII according to the current Best's Key Rating Guide, or a company equal financial stability that is approved by the City's Risk Manager. J. This Agreement shall not take effect until certificate(s) or other sufficient proof that these insurance provisions have been complied with, are filed with and approved by the CITY's Risk Manager. If the CONTRACTOR does not keep all of such insurance policies in full force and effect at all times during the terms of this Agreement, the CDC may elect to treat the failure to maintain the requisite insurance as a breach of this Agreement and terminate the Agreement as provided herein. 17. LEGAL FEES. If any party brings a suit or action against the other party arising from any breach of any of the covenants or agreements or any inaccuracies in any of the representations and warranties on the part of the other party arising out of this Agreement, then in that event, the prevailing party in such action or dispute, whether by final judgment or out -of -court settlement, shall be entitled to have and recover of and from the other party all costs and expenses of suit, including attorneys' fees. For purposes of determining who is to be considered the prevailing party, it is stipulated that attorney's fees incurred in the prosecution or defense of the action or suit shall not be considered in determining the amount of the judgment or award. Attorney's fees to the prevailing party if other than the CDC shall, in addition, be limited to the amount of attorney's fees incurred by the CDC in its prosecution or defense of the action, irrespective of the actual amount of attorney's fees incurred by the prevailing party. 18. MEDIATION/ARBITRATION. If a dispute arises out of or relates to this Agreement, or the breach thereof, the parties agree first to try, in good faith, to settle the dispute by mediation in San Diego, California, in accordance with the Commercial Mediation Rules of the American Arbitration Association (the "AAA") before resorting to arbitration. The costs of mediation shall be borne equally by the parties. Any controversy or claim arising out of, or relating to, this Agreement, or breach thereof, which is not resolved by mediation shall be settled by arbitration in San Diego, California, in accordance with the Commercial Arbitration Rules of the AAA then existing. Any award rendered shall be final and conclusive upon the parties, and a judgment thereon may be entered in any court having jurisdiction over the subject 6 matter of the controversy. The expenses of the arbitration shall be borne equally by the parties to the arbitration, provided that each party shall pay for and bear the costs of its own experts, evidence and attorneys' fees, except that the arbitrator may assess such expenses or any part thereof against a specified party as part of the arbitration award. 19. TERMINATION. A. This Agreement may be terminated with or without cause by the CDC. Termination without cause shall be effective only upon 60- day's written notice to the CONTRACTOR. During said 60-day period the CONTRACTOR shall perform all services in accordance with this Agreement. B. This Agreement may also be terminated immediately by the CDC for cause in the event of a material breach of this Agreement, misrepresentation by the CONTRACTOR in connection with the formation of this Agreement or the performance of services, or the failure to perform services as directed by the CDC. C. Termination with or without cause shall be effected by delivery of written Notice of Termination to the CONTRACTOR as provided for herein. D. In the event of termination, all finished or unfinished Memoranda Reports, Maps, Drawings, Plans, Specifications and other documents prepared by the CONTRACTOR, whether paper or electronic, shall immediately become the property of and be delivered to the CDC, and the CONTRACTOR shall be entitled to receive just and equitable compensation for any work satisfactorily completed on such documents and other materials up to the effective date of the Notice of Termination, not to exceed the amounts payable hereunder, and less any damages caused the CDC by the CONTRACTOR's breach, if any. Thereafter, ownership of said written material shall vest in the CDC all rights set forth in Section 6. E. The CDC further reserves the right to immediately terminate this Agreement upon: (1) the filing of a petition in bankruptcy affecting the CONTRACTOR; (2) a reorganization of the CONTRACTOR for the benefit of creditors; or (3) a business reorganization, change in business name or change in business status of the CONTRACTOR. 20. NOTICES. All notices or other communications required or permitted hereunder shall be in writing, and shall be personally delivered; or sent by overnight mail (Federal Express or the like); or sent by registered or certified mail, postage prepaid, return receipt requested; or sent by ordinary mail, postage prepaid; or telegraphed or cabled; or delivered or sent by telex, telecopy, facsimile or fax; and shall be deemed received upon the earlier of (i) if personally delivered, the date of delivery to the address of the person to receive such notice, (ii) if sent by overnight mail, the business day following its deposit in such overnight mail facility, (iii) if mailed by registered, certified or ordinary mail, five (5) days (ten (10) days if the address is outside the State of California) after the date of deposit in a post office, mailbox, mail chute, or other like facility regularly maintained by the United States Postal Service, (iv) if given by telegraph or cable, when delivered to the telegraph company with charges prepaid, or (v) if given by telex, telecopy, facsimile or fax, when sent. Any notice, request, demand, direction or other communication delivered or sent as specified above shall be directed to the following persons: 7 To the CDC: Benjamin Martinez Executive Director Community Development Commission of the City of National City 140 East 12th Street, Suite B National City, CA 91950 To the CONTRACTOR: Missy Talbert Account Manager Office Pavilion San Diego 6920 Carroll Road San Diego, CA 91950 Notice of change of address shall be given by written notice in the manner specified in this Section. Rejection or other refusal to accept or the inability to deliver because of changed address of which no notice was given shall be deemed to constitute receipt of the notice, demand, request or communication sent. Any notice, request, demand, direction or other communication sent by cable, telex, telecopy, facsimile or fax must be confirmed within forty-eight (48) hours by letter mailed or delivered as specified in this Section. 21. CONFLICT OF INTEREST AND POLITICAL REFORM ACT OBLIGATIONS. During the term of this Agreement, the CONTRACTOR shall not perform services of any kind for any person or entity whose interests conflict in any way with those of the Community Development Commission of the City of National City. The CONTRACTOR also agrees not to specify any product, treatment, process or material for the project in which the CONTRACTOR has a material financial interest, either direct or indirect, without first notifying the CDC of that fact. The CONTRACTOR shall at all times comply with the terms of the Political Reform Act and the National City Conflict of Interest Code. The CONTRACTOR shall immediately disqualify itself and shall not use its official position to influence in any way any matter coming before the CDC in which the CONTRACTOR has a financial interest as defined in Government Code Section 87103. The CONTRACTOR represents that it has no knowledge of any financial interests that would require it to disqualify itself from any matter on which it might perform services for the CDC. ❑ If checked, the CONTRACTOR shall comply with all of the reporting requirements of the Political Reform Act and the National City Conflict of Interest Code. Specifically, the CONTRACTOR shall file a Statement of Economic Interests with the City Clerk of the City of National City in a timely manner on forms which the CONTRACTOR shall obtain from the City Clerk. The CONTRACTOR shall be strictly liable to the CDC for all damages, costs or expenses the CDC may suffer by virtue of any violation of this Paragraph 21 by the CONTRACTOR. 8 22. MISCELLANEOUS PROVISIONS. A. Computation of Time Periods. If any date or time period provided for in this Agreement is or ends on a Saturday, Sunday or federal, state or legal holiday, then such date shall automatically be extended until 5:00 p.m. Pacific Time of the next day which is not a Saturday, Sunday or federal, state or legal holiday. B. Counterparts. This Agreement may be executed in multiple counterparts, each of which shall be deemed an original, but all of which, together, shall constitute but one and the same instrument. C. Captions. Any captions to, or headings of, the sections or subsections of this Agreement are solely for the convenience of the parties hereto, are not a part of this Agreement, and shall not be used for the interpretation or determination of the validity of this Agreement or any provision hereof. D. No Obligations to Third Parties. Except as otherwise expressly provided herein, the execution and delivery of this Agreement shall not be deemed to confer any rights upon, or obligate any of the parties hereto, to any person or entity other than the parties hereto. E. Exhibits and Schedules. The Exhibits and Schedules attached hereto are hereby incorporated herein by this reference for all purposes. F. Amendment to this Agreement. The terms of this Agreement may not be modified or amended except by an instrument in writing executed by each of the parties hereto. G. Waiver. The waiver or failure to enforce any provision of this Agreement shall not operate as a waiver of any future breach of any such provision or any other provision hereof. H. Applicable Law. This Agreement shall be governed by and construed in accordance with the laws of the State of California. I. Entire Agreement. This Agreement supersedes any prior agree- ments, negotiations and communications, oral or written, and contains the entire agreement between the parties as to the subject matter hereof. No subsequent agreement, representation, or promise made by either party hereto, or by or to an employee, officer, agent or representative of any party hereto shall be of any effect unless it is in writing and executed by the party to be bound thereby. J. Successors and Assigns. This Agreement shall be binding upon and shall inure to the benefit of the successors and assigns of the parties hereto. K. Construction. The parties acknowledge and agree that (i) each party is of equal bargaining strength, (ii) each party has actively participated in the drafting, preparation and negotiation of this Agreement, (iii) each such party has consulted with or has had the opportunity to consult with its own, independent counsel and such other professional advisors as such party has deemed appropriate, relative to any and all matters contemplated under this Agreement, (iv) each party and such party's counsel and advisors have reviewed this Agreement, (v) each party has agreed to enter into this Agreement following such review and the rendering of such advice, and (vi) any rule or construction to the effect that ambiguities are to be resolved against the drafting party shall not apply in the interpretation of this Agreement, or any portions hereof, or any amendments hereto. // // 9 // // IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the date and year first above written. COMMUNITY DEVELOPMENT OFFICE PAVILION OF THE CITY OF NATIONAL CITY (Two signatures required fora corporation) By: By: Nick Inzunza, Chairman (Name) (Title) APPROVED AS TO FORM: By: George H. Eiser, III (Name) CDC Legal Counsel (Title) 10 OFFICE PAVILIONI SAN DIEOO Scope of Work Office Remodel —Provide labor and materials to complete the following scope of work: OFFICE PAVILION SAN DIEGO *FURNITURE 1. Provide new systems furniture reception station & seating. 2. Provide new center workstation cluster w/file & machine area. 3. Provide tall systems walls to enclose two existing offices. 4. Provide new furniture in combination with existing furniture to complete overall desired layout * INSTALLATION • All work to be performed Mon. -Fri. during normal business hours. • Building must be ready to receive furniture prior to installation. Storage charges applicable on product stored beyond 30 days for bldg delays Customer to provide the following: 1. Permits if required 2. Electrician to hard -wire for systems furniture 3. Cable Vendor *The above furniture and services are in accordance with public bid contract — AG0276- used by the City of National City. The same line of furniture supplied for National City Library and National City Fire Station #34 will be used for the Community Development Commission office remodel. EXHIBIT "A" 72 OFFICE PAVILION SAN DIEGO NATIONAL CITY COMMUNITY DEVELOPMENT COMMSION FURNITURE PROJECT TIMELINE *UPON 50% DEPOSIT ($31, 085.68) AND SIGN OFF ON PROPOSAL THE FOLLOWING TIMELINE WILL APPLY.• ENTER FURNITURE ORDER FURNITURE MANUFACTURING TRANSIT TO OP WAREHOUSE FURNITURE INSTALLATION PROJECT WALK-THROUGH DAY 6 WEEKS 1 WEEK 3-4 DAYS 1 DAY PROJECT DURATION 8 WEEKS *Herman Miller will be having a price increase on September 5th, 2005. In order to avoid all price increases that will become effective on this date, please submit deposit and sign off on proposal prior to September 2nd. Please contact Office Pavilion should you have any questions concerning the Herman Miller price increase. Office Pavilion National City Community Development FINAL PROJECT ORDER 1 of 21 Item 1 2 3 4 Mfg Cat j Part Number HMI !HAO 02 HMI HAO A1120.8530N HMI HAO HMI IH 1 WL WL 21 02 21 02 ........................................... A1120.8536N WL WL 21 02 21 02 0 1A1120.8542N WL WL 21 102 121 102 Part Description Notes A1120.8524N +Panel,Fabric Npwr 85H AO walls 24W WL +sandstone WL +sandstone 21 +grasscloth-Pr Cat 1 02 +grasscloth pampas 21 +grasscloth-Pr Cat 1 +grasscloth pampas +Panel,Fabric Npwr 85H AO Walls 30W +sandstone +sandstone +grasscloth-Pr Cat 1 +grasscloth pampas +grasscloth-Pr Cat 1 +grasscloth pampas +Panel,Fabric Npwr 85H !AO Walls 36W +sandstone +sandstone +grasscloth-Pr Cat 1 +grasscloth pampas +grasscloth-Pr Cat 1 +grasscloth pampas +Panel,Fabric Npwr 85H AO Walls 42W +sandstone +sandstone +grasscloth-Pr Cat 1 +grasscloth pampas +grasscloth-Pr Cat 1 +grasscloth pampas Qty Ext List $ J Sell $ 1 $ 468.00 $ 468.00 List $ 520.00 i $ 602.00 Ext Sell $ $ 132.441 $ 132.44 1,560.00 $ 147.16 1,806.00 441.48 170.37 $ 511.11 $ 640.00 i $ 640.00 j $ 181.12 $ 181.12 C:\Documents and Settings\missy\My Documents\CAP1Projects\NATIONALCITY\FINAL ORDER.sp4 05/16/05 10:53:57 Approximate Lead Time = 6 weeks Quoted by Missy Talbert Office Pavilion National City Community Development FINAL PROJECT ORDER 2 of 21 Item 5 6 7 8 9 10 11 Mfg !Cat1 .. Part,Nurnber HMI ............... HMI HMI HMI OFS OFS HAO A1120.8548N +Pane 48W WL +sandstone WL +sandstone 21 +grasscloth-Pr Cat 1 02 +grasscloth pampas 21 +grasscloth-Pr Cat 1 02 :+grasscloth pampas A1190.8548 :+Dr Panel 85H 48W WL WL LV TR WL WL HAO A1220.85H HAO HAO 0 FS MCC OFS 175-72BCB 1MCC W Part Description Notes _ Qty1 List $ I,Fabric Npwr 85H 1AO Walls AO Walls AO Walls AO Walls WL '+sandstone A0215 .....8215_....0 ..._._._.....__-...I+Draw Rod 80H........._................... AO Walls +sandstone +sandstone +lever - silver +clear +sandstone +sandstone +Conn,2-Way 90 Deg Hard 85H +sandstone +sandstone +Wall Start 80H 75-6640HD 66X39 HIGHBACK Byron ORGANIZER, PRAXIS CRESCENT CHERRY ON ... RADIUS 36X72 BOOKCASE, PRAXIS Byron CRESCENT CHERRY ON ... RADIUS 3 $ 680.00 2,058.00 2 $ 126.00 Ext List $ j Sell $ Ext Sell $ $ 2,040.00 $ 4,116.00 45.001 $ 180.00 1 13 $ 18.001 234.00 1 3 $ 2,344.00 i 1 4 $ 192.44 $ 577.32 $ 582.411 $ 1,164.82 71.32 5.09 $ 66.17 2,344.001 $ 1,172.00 $ 1,172.00 1,902.001 $ 7,608.001 $ 951.00 $ 3,804.00 C:\Documents and Settings\missy\My Documents\CAP\Projects\NATIONALCITY\FINAL ORDER.sp4 05/16/05 10:53:57 A Dximate Lead Time = 6 weeks Quoted by Missy Ti 't Office Pavilion Item 12 13 14 15 16 17 18 19 National City Community Development FINAL PROJECT ORDER Mfg Cat 1 Part Number Part Description OFS !OFS 75-7242EPTR/CB5172X42 RIGHT P TABLE W/5"1Byron (BASE PRAXIS MCC ICRESCENT CHERRY ON ... I W RADIUS• OFS OFS 75-7422MCT 174X22 CABINET TOP, !Byron !PRAXIS MCC ;CRESCENT CHERRY ON ... W ;RADIUS X NO GROMMET 1 OFS .OFS 75-1822MBFC 18X22 BOX/BOX/FILE Byron !PEDESTAL, PRAXIS MCC ;CRESCENT CHERRY ON ... X IBLACK TAB PULL X 1NO GROMMET OFS OFS 75-1822MFFC 118X22 FILE/FILE ;Byron PEDESTAL, PRAXIS MCC :CRESCENT CHERRY ON ... X !BLACK TAB PULL X INO GROMMET OFS OFS 75-4822ER 148X22 EXECUTIVE RETURNByron PRAXIS MCC 'CRESCENT CHERRY ON ... W ;RADIUS OFS OFS 75-3722FS 137X22 FILLER SHELL, 1 1Byron SHELF, PRAXIS MCC 'CRESCENT CHERRY ON ... X IND GROMMET OFS .OFS OCD 125X16 CENTER DRAWER 'Byron MCC ;CRESCENT CHERRY ON ... 1 OFS OFS FT-6321 63X21 FABRIC ;Byron TACKBOARD, PRAXIS 1 GRADE 1 FABRICS j1 MOMENTUM INSIGHT 11006 FAUNA 3of21 Notes Qy List $ Ext List $ Sell $ Ext Sell $ 1 $ 3,095.00 $ 3,095.00j $ 1,547.50 $ 1,547.50 1 $ 695.001 .........._$...........695.00.,..........._$_....... 347.50 347.50 1,255.00 $ 1,255.00 $ 627.50$ 627.50 $ 1,255.00 $ 1,255.00 1 1 $ 1,173.001 $ 1,173.00 601.00I $ 601.00 257.00 $ 257.00 255.00 $ 255.00 627.50 586.50 300.50 $ 627.50 $ 586.50 300.50 128.50 $ 128.50 127.50 $ 127.50 C:\Documents and Settings\missy\My Documents\CAP\Projects\NATIONALCITY\FINAL ORDER.sp4 05/16/05 10:53:57 Approximate Lead Time = 6 weeks Quoted by Missy Talbert Office Pavilion National City Community Development FINAL PROJECT ORDER 4of21 Item 20 21 22 23 24 25 26 27 28 29 30 , Pifzi.Cat 1 Part Number Part Description L Notes Qty List $ Ext List $ Sell $ Ext Sell $ OFS OFS TL-1 140X8 TASK LIGHT, OCTRONI.Byron 1 $ 190.00 $ 190.001 $ 95.001 $ 95.00 1BULB : . , • . I 1,404 W04 179ACD-11/2 !Adjustable Corner Diagonal ETHO 1 $ 56.00 $ 56.00 $ 33.60 $ 33.60 I * Standard Color :•• * Black . 1 W04 W04 2120 Clip -On Mouse Palm 1ETHO 3 1 $ 21.00 $ 63.00 Support For Banana Board 1 . * Leatherite Color : . i 1 : : 25 Midnight .. W04 W04 2170-28TG Pinnacle Arm, 28 1ETHO 31 212.001 $ 636.001 $ 127.20 $ 381.60 i 1 W04 W04 2180S Banana Board Platform With ETHO 3 $ 189.001 $ 567.00i $ 113.401 $ 340.20 * Leatherite Palm Support 1 . Platform Color : 1 : . * Black IF Palm Support 25 iMidnite 1 : HMI HEI 232092-230 1+Lock Plugs and Keys,#230 ETHO 2 $ 6.90 $ 13.80 1.95 3.90 . 1 • HMI HEI 232092-226 1+Lock Plugs and Keys,#226 iETHO 2 $ 6.90 13.80 $ 1.95 3.90 I HMI HEI 232092-227 +Lock Plugs and Keys,#227 IETHO 3 $ 6.901 20.701 $ 1.95 5.85 1.. , HMI HEI 232092-229 HEI 232092-228 i 1 I +Lock Plugs and Keys,#229 iETH0 1 6.901 $ 6.901 $ 1.951 i : ! +Lock Plugs and Keys,#228 ETHO 4 $ 6.901 $ • 27.60 1.95 ! i $ 12.601 37.80 +Bkcase,Frstnd,No Doors 36W 65 5I8H TS i+textured steel WL +sandstone Ti +1"-high painted metal top w... NS5 +5 shelves total B2 1+1 1/2"-high base ETHO 1 1.95 7.80 .... 667.00 e57.661 295.65 C.Mocuments and Settings\missy\My Documents\CAP\Projects\NATIONALCITY\FINAL ORDER.sp4 05/16/05 10:53:58 oximate Lead Time = 6 weeks Quoted by Missy Tr rt Office Pavilion National City Community Development FINAL PROJECT ORDER 5of21 Item 31 32 33 34 35 36 37 Mfg Cat j Part Number HMI HST IAE123AWB _ HMI .......... HGN AJ G1 BB BK 3D 13 DL931.2424L LA WL G7 HMI HEI E1109.5424N WL WL HMI HEI E1109.5430N WL WL HMI HEI E1109.5436N HMI HEI HMI HEI WL. WL E1109.5448N WL WL E1109.7024N WL WL Part Description +Chair,Aeron Wk,2-Stg !ETHO Pneu.,TIt Lim/Seat,Adj Ar... +adjustable lumbar support +graphite +2 1/2" hard caster, black yo... +black +pellicle® classic +pellicle® classic hematite +Ext,Sq-Edge Rect,Attach 1ETHO From Rt,Lam 24D 24W +light ash +sandstone +glides '+Frame,Npwr No Access 1ETHO 54H 24W +sandstone +sandstone +Frame,Npwr No Access 1ETHO 54H 30W +sandstone +sandstone +Frame,Npwr No Access ;ETHO 54H 36W +sandstone +sandstone +Frame,Npwr No Access ETHO 54H 48W +sandstone +sandstone +Frame,Npwr No Access IETHO 70H 24W +sandstone +sandstone Notes , Qty 14 4 List $ $ 1,269.00 $ 655.00 329.00 $ 361.00 Ext List $ $ 5,076.00 Sell $ $ 659.88 .... ...:.............. 655.001 $ : 361.00 i Ext Sell $ $ 2,639.52 185.371 $ 185.37 98.701 $ 394.80 108.30! $ 108.30 $ 393.00 $ 1,572.00 $ 117.901 $ 471.60 456.00 $ 456.001 $ 136.80. • $ 370.00 ! $ 370.00 i 111.00 f i � ! 136.80 C:\Documents and Settings\missy\My Documents\CAP\Projects\NATIONALCITY\FINAL ORDER.sp4 05/16/05 10:53:58 Approximate Lead Time = 6 weeks Quoted by Missy Talbert Office Pavilion National City Community Development FINAL PROJECT ORDER 6 of 21 Item 38 39 40 41 42 43 44 45 46 Mfg HMI HMI HMI HMI HMI HMI HMI HMI Cat 1 Part Number HEI 1E1109.7030E HEI HEI HEI HEI HEI HEI HEI Part Description +Frame,Pwr 4-Circ 70H 30W1ETHO WL +sandstone WL +sandstone E1109.7030N 1+Frame,Npwr No Access •70H 30W WL +sandstone WL +sandstone E1109.7036E +Frame,Pwr 4-Circ 70H 36W WL WL E1109.7036N WL WL E1109.7042E WL WL E1109.7048E +sandstone +sandstone +Frame,Npwr No Access 70H 36W +sandstone +sandstone +Frame,Pwr 4-Circ 70H 42W +sandstone +sandstone +Frame,Pwr 4-Circ 70H 48W Notes Qty 1 ETHO 2 ETHO 2 ETHO 2 ETHO 1 ETHO 2 WL +sandstone WL +sandstone E1109.7048N +Frame,Npwr No Access ETHO 70H 48W WL +sandstone WL +sandstone E1109.8624E +Frame,Pwr 4-Circ 86H 24W ETHO WL +sandstone WL +sandstone HMI HEI E1109.8630E +Frame,Pwr 4-Circ 86H 30W1ETHO WL +sandstone WL +sandstone List $ Ext List $ $ 529.00 $ 529.00 $ 402.001 804.00 $ 561.00 $ 1,122.00 Sell $ Ext Sell $ $ 158.70 $ 158.70 $ 120.60 $ 241.20 $ 168.30 $ 336.60 $ 434.00 $ 868.00 130.20 $ 260.40 593.00 1 593.00 $ 177.90 $ 624.00 $ 1,248.00i 187.20 497.00 5 $ 539.00 571.00 $ 497.00 2,695.00 $ 161.70 1,142.00 171.30 149.101 $ 177.90 374.40 149.10 $ 808.50 $ 342.60 C:\Documents and Settings\missy\My Documents\CAP\Projerts\NATIONALCITY\FINAL ORDER.sp4 05/16/05 10:53.58 At )ximate Lead Time = 6 weeks Quoted by Missy TE Office Pavilion National City Community Development FINAL PROJECT ORDER 7 of 21 Item 47 48 49 50 51 52 53 54 55 56 Mfg HMI HMI HMI HMI HMI HMI HMI HMI HMI Cat Part Number HEI E1109.8636E WL WL t1199.8636N WL WL HEI E1109.8648E • 1WL 1WL HEI 1E1115.36L RA WL WL HEI E1120.54 HEI 1E1120.70 HEI 1E1120.86 HEI 1E1210.86 WL HEI E1220.54SRN HEI WL WL WL E1220.70SRN WL WL WL Part Description +Frame,Pwr 4-Circ 86H 36W ETHO +sandstone +sandstone Notes Qtx. List $ Ext List $ Sell $ Ext Sell $ 5 $ 603.001 $ 3,015.00. $ 180.901 $ 904.50 +Frame,Npwr No Access ETHO 4 $ 476.00 86H 36W +sandstone +sandstone +Frame,Pwr 4-Circ 86H 48W ETHO 1 667.00; 667.00 +sandstone +sandstone @Dr Frame,W/Dr L Swing ETHO 1 $ 3,829.00 36W @light ash sandstone @sandstone +Draw Rod 54H +sandstone +Conn,i-Waj, 90 Vinyl,Npwr 54H +sandstone +sandstone +sandstone +Conn,2-Way 90 Vinyl,Npwr ETHO 70H +sandstone +sandstone +sandstone 142.801 $ 571.20 200.10 200.10 $ 3,829.00$ 1,148.70 $ 1,148.70 ETHO 6 1 $ 17.00 $ 102.00 5.1030.60 } }•! • • i.. +Draw Rod 70H ETHO 9 I $ 20.001 $ 180.00 $ 6.001 54.00 . 1 } ; . • } ' ; +Draw Rod 86H lETHO 9 $ 21.001 $ 189.001 $ 6.301 56.70 1 1 +Wall Start 86H '-'- — - — .ETHO 1 $ 99.001 $ 99.001 $ 29.701 $ 29.76 1 I 1 } ETHO 1,904.001 1 $ 202.001 $ 202.00 $ 60.601 $ 60.60 } 222.00 444.00 "ii."6"oi"" C:\Documents and Settings\missy\My Documents\CAP\Projects\NATIONALCITY\FINAL ORDER.sp4 05/16/05 10:53:58 Approximate Lead Time = 6 weeks Quoted by Missy Talbert Office Pavilion National City Community Development FINAL PROJECT ORDER 8of21 Item 57 58 59 60 61 62 63 Mfg HMI HMI HMI HMI HMI .......... HMI HMI Cat Part Number HEI 1E1220.86SRE !WL WL WL HEI 1E1220.86SRN HEI HEI HEI HEI WL WL WL E1221.54S WL WL WL ..................................... E1222.86SE WL WL WL WL E1230.54SE WL WL WL E1230.70SN WL WL WL HEI E1230.86SE WL WL 1WL Part Description +Conn,2-Way 90 Vinyl,Pwr iETHO 86H +sandstone +sandstone +sandstone 86H......._...2-Way90...Viinyl,N...._wr....ETHO +Conn,2-Way 90 Vinyl,Npwr ETHO +sandstone +sandstone +sandstone +Conn,2-Way 135 Vinyl 54H. ETHO +sandstone +sandstone +sandstone +Spacer Vinyl,Pwr 86H +sandstone +sandstone +sandstone +sandstone +Conn,3-Way 90 Vinyl,Pwr 54H +sandstone +sandstone +sandstone +Conn,3-Way 90 Vinyl,Npwr 70H +sandstone +sandstone +sandstone +Conn,3-Way 90 Std Vinyl,Pwr 86H +sandstone +sandstone +sandstone ETHO ETHO ETHO ETHO Notes i Qty List $ Ext List $ Sell $ 2 I $ 280.001 $ 560.00 250.00 298.00 304.00 750.00 $ 648.00 $ 876.00 1 298.001 Ext Sell $ $ 84.00 $ 168.00 $ 75.00 97.20 87.60 89.40 304.00 $ •91.20 $ tiotool 110.10 225.00 194.40 262.80 89.40. 91.20 330.30 C:mocuments and Settings\missy\My Documents\CAP\Projects\NATIONALCITY\FINAL ORDER.sp4 05/16/05 10:53:58 A, ,ximate Lead Time = 6 weeks Quoted by Missy TE rt 0. ePaviIion Item 64 65 66 67 68 69 70 Mfg Cat Part Number HMI HEI E1250.54S HMI HEI HMI HEIHMI HEI ** WL E1250.70S WL E1251.16S WL E1311.A WL HMI HEI E1311.B WL HMI HEI E1311.0 WL HMI HEI IE1311.D 71 72 73 74 HMI HEI HMI HEI WL E1322.06E E1411.1624T WL TR HMI HEI E1411.1630M +Tile,Glazed Window 1ETHO 2 Mid/Bot 16H 30W WL +sandstone TR 11 +clear 1 • HMI HEI E1411.1630T 1+Tile,Glazed Window Top ilETNO 12 $ 96.00 16H 30W . : WL 1+sandstone TR . I I 1+clear National City Comt...mity Development FINAL PROJECT ORDER 9 oi A Part Description Notes 1 Qty List $ Ext List $ Sell Ext Sell $ +Fin End,Std 54H ETHO ' 3 $ 56.00. $ 168.001 $ 16.801 $ 50.40 +sandstone +Fin End,Std 70H ETHO 3 $ 62.00 $ 186.00 $ 18.60' $ 55.80 +sandstone +Chg of Ht Fin End Std 16H ETHO 6 $ 42.00r $ 252.00 $ 12.60 75.60 +sandstone +Rcp,4-Circ A Duplex 6/Pkg 1ETHO 1 $ 157.00 157.001 $ 47.10 $ 47.10 +sandstone .•• +Rcp,4-Circ B Duplex 6/Pkg 1ETHO 1 $ 157.00 157.001 $ 47.10 47.10 +sandstone +Rcp,4-Circ C Duplex 6/Pkg lETHO 1 157.00 S 47.10! 47.10 $ 157.00 +sandstone 1 • 1+Rcp,4-Circ D 1ETHO 1 $ 157.001 $ 157.001 $ 47.101 $ 47.10 • • Duplex,Dedicated 6/Pkg 1 • 1 1 +sandstone , 1 . I . , . +Power Entry,Ext. Dir Con ETHO 2j $ 125.00! $ 250.001 $ 37.50 75.00 4-Circ,6Ft L 1 . : ; • +Tile,Glazed Window Top .1ETHO 141 $ 86.001 $ 1,204.00 $ 25.80 $ 361.20 16H 24W 1 . 1 . +sandstone 1 : +clear .. • 1 28.80 96.00l $ 192.001 ••• $ 1,152.00 $ 28.80 345.60 1 C:\Documents and Settings\missy\My Documents\CAP\Frojects\NATIONALCITY\FINAL ORDER.sp4 05/16/05 10:53:58 Approximate Lead Time = 6 weeks Quoted by Missy Talbert Office Pavilion National City Community Development 10 of 21 FINAL PROJECT ORDER Item 75 76 77 78 79 80 81 82 83 Mfg HMI HMI HMI HMI HMI HMI HMI .......... HMI HMI Cat 1_ Part Number HEI 1E1411.1636M HEI WL 1TR 1E1411.1636T WL TR HEI 1E1411.1648T WL TR HEI 1E1411.3236T IWL TR HEI E1420.1624F HEI HEI HEI HEI 21 02 E1420.1636F 21 02 E1420.1648F 21 02 E1420.3224F 21 02 E1420.3230F Part Description +Tile,Glazed Window ;Mid/Bot 16H 36W i+sandstone 1+clear +Tile,Glazed Window Top 116H 36W 1+sandstone 1+clear I+Tile,Glazed Window Top 116H 48W +sandstone 1+clear +Tile,Glazed Window Top 132H 36W +sandstone +clear +Tile,Face Fabric 16H 24W +grasscloth-Pr Cat 1 +grasscloth pampas +Tile,Face Fabric 16H 36W +grasscloth-Pr Cat 1 +grasscloth pampas +Tile,Face Fabric 16H 48W +grasscloth-Pr Cat 1 +grasscloth pampas +Tile,Face Fabric,32H 24W +grasscloth-Pr Cat 1 +grasscloth pampas +Tile,Face Fabric,32H 30W 21 +grasscloth-Pr Cat 1 02 +grasscloth pampas Notes 1 Qty List $ ... Ext List $ ETHO 16 1 $ 107.001 $ 1,712.00 IETHO IETHO ETHO ETHO IETHO 1 ETHTHOO. ETHO ETHO 107.00' $ 2,568.001 132.001 $ 528.00 $ 193.00 62.00 74.00 87.00 87.00 98.00 772.001 $ 372.001 • $ 592.001 174.001 Sell $ Ext Sell $ $ 32.101 $ 513.60 32.101 39.601 57.90 $ 770.40 $ 158.40 $ 231.60 18.60 $ 111.60 22.20' $ 177.60 26.10 52.20 696.00 $ 26.10 $ 208.80 $ 196.00 29.40 58.80 C:\Documents and Settings\missy\My Documents\CAP\Projects\NATIONALCITY\FINAL ORDER.sp4 05/16/05 10:53:58 App--'ximate Lead Time = 6 weeks Quoted by Missy Talh"n 01.,,:e Pavilion National City Comi...anity Development FINAL PROJECT ORDER 11c Item 84 85 86 87 88 89 90 91 92 Mfg Cat l Part Number Part Descrption Notes HMI HEI E1420.3236F +Tile,Face Fabric,32H 36W ETHO HMI HMI HMI HMI HMI HMI HMI 21 02 HEI IE1420.3248F 121 02 HEI 1E1420.4824F H ...EI....... HEI HEI 21 02 ............. ...... HEI IE1420.6424F • 121 02 HEI 1 E1420.6430 F 21 €02 HMI HEI E1420.6436F 21 02 +grasscloth-Pr Cat 1 +grasscloth pampas +Tile,Face Fabric,32H 48W +grasscloth-Pr Cat 1 +grasscloth pampas +Tile,Face Fabric,48H 24W ETHOI ETHO 21 +grasscloth-Pr Cat 1 02 +grasscloth pampas E1420.4830F +Tile,Face Fabric,48H 30W 1ETHO 1 j 21 +grasscloth-Pr Cat 1 02 '+grasscloth pampas E1420.4836F 1+Tile,Face Fabric,48H 36W IETHO 21 +grasscloth-Pr Cat 1 02 `+grasscloth pampas E1420.4848F +Tile,Face Fabric,48H 48W 1ETHO +grasscloth-Pr Cat 1 +grasscloth pampas +Tile,Face Fabric,64H 24W 1ETHO +grasscloth-Pr Cat 1 +grasscloth pampas +Tile,Face Fabric,64H 30W 1ETHO +grasscloth-Pr Cat 1 +grasscloth pampas +Tile,Face Fabric,64H 36W 'ETHO 1 +grasscloth-Pr Cat 1 +grasscloth pampas 1 Qty List $ Ext List $ Sell $ Ext Sell $ 12 $ 107.001 $ 1,284.001 $ 32.101 $ 385.20 2 • 127.00 1 130.00 $ 141.00 157.00 186.00 254.001 $ 38.101 $ 76.20 260.001 39.00 1,128.001 $ 42.30 78.00 $ 338.40 942.001 $ 47.101 $ 282.60 372.00 55.80 173.001 $ 1,730.001 $ 51.90 188.001 $ 376.00 • 209.00 56.40 2,508.001 $ 62.70 $ 111.60 $ 519.00 $ 112.80 752.40 C:\Documents and Settings\missy\My Documents\CAP\Projects\NATIONALCITY\FINAL ORDER.sp4 05/16/05 10:53:58 Approximate Lead Time = 6 weeks Quoted by Missy Talbert Office Pavilion National City Community Development FINAL PROJECT ORDER 12of21 Item 93 94 95 96 97 98 99 100 Mfg Cat Part Number Part Description HMI HEI 1E1420.6442F +Tile,Face Fabric,64H 42W 21 +grasscloth-Pr Cat 1 02 !+grasscloth pampas HMI HEI IE1420.6448F i+Tile,Face Fabric,64H 48W ETHO 121 +grasscloth-Pr Cat 1 02 +grasscloth pampas HMI HEI 1E1690.MWS +Dr Lever Handle,Lock !ETHO ':.Set/Std Bevel CK i+satin chrome HMI HEI E2110.2430L '+Work Surf,Sq-Edge ETHO Rect,No Trough 24D 30W LA +light ash WL +sandstone SM +on module HMI HEI E2110.2436L +Work Surf,Sq-Edge ETHO Rect,No Trough 24D 36W LA +light ash WL +sandstone SM +on module HMI HEI E2110.2442L +Work Surf,Sq-Edge ETHO Rect,No Trough 24D 42W LA +light ash WL +sandstone SM +on module HMI HEI E2110.2448L +Work Surf,Sq-Edge ETHO Rect,No Trough 24D 48W LA +light ash WL +sandstone SM +on module HMI HEI IE2110.2460L +Work Surf,Sq-Edge ETHO Rect,No Trough 24D 60W LA +light ash WL +sandstone SM +on module Notes ETHO Qty .. List $ Ext List $ 2 1 $ 226.001 $ 452.00 247.001 $ 1,482.00 i 625.001 $ 625.001 $ 187.50 226.00 $ 226.001 $ 67.80 249.00 374.00 $ 747.00 271.00 74.70 Sell $ Ext Sell $ $ 67.80 $ 135.60 74.10; $ 444.60 $ 187.50 67.80 224.10 81.30 $ 81.30 1,176.001 88.20 374.00 $ 352.80 112.201 112.20 C:\Documents and Settings\missy\My Documents\CAP\Projects\NATIONALCITy\FINAL ORDER.sp4 05/16/05 10:53:58 Approximate Lead Time = 6 weeks Quoted by Missy Tall- -t C. _ ce Pavilion National City Comi...mity Development FINAL PROJECT ORDER 13L .1 Item 101 102 103 104 105 106 Mfg Cat 1 Part Number HMI 'HEI 1E2110.2472L HMI HMI HMI HMI HMI LA IWL ISM HEI 1E2135.2436L ILA WL SM.......................... _ . _.... HEI E2165.3060L LA DY WL SM HEI E2283.24L WL HEI E3110.24F KA WL SM 1Z 03................_.......... HEI IE3110.36F KA 1WL SM '1Z 03 Part Description +Work Surf,Sq-Edge IETHO 'Rect,No Trough 24D 72W +light ash +sandstone +on module +Work Surf,Sq-Edge Cnr,No ETHO Trough 24D 36W +light ash +sandstone +on module +Peninsula,Sq-Edge IETHO Oval-End,No Trough 30D 6...1 +light ash +plain column +sandstone +on module +Support Panel,Wk Surf Lam,End,Glides 24D +sandstone +Flip Dr Unit,E-Style,FabricNinyl 2... +keyed alike +sandstone +on module +penumbra -Pr Cat 1 +penumbra rhea +Flip Dr IETHO Unit,E-Style,FabricNinyl 3... +keyed alike +sandstone +on module +penumbra -Pr Cat 1 +penumbra rhea IETHO ETHO Notes Qty List $ Ext List $ 1 $ 452.00 $ 452.00 3 342.00 $ 624.00 684.001 624.00 Sell $ Ext Sell $ $ 135.601 $ 135.60 102.60 $ 205.20 187.20 $ 274.001 $ 548.00 $ 82.20 408.001 $ 408.00 $ 122.40 475.00 $ 1,425.00 142.50':. $ 187.20 164.40 122.40 427.50 C:\Documents and Settings\missy\My Documents\CAP\Projects\NATIONALCITY\FINAL ORDER.sp4 05/16/05 10:53:59 Approximate Lead Time = 6 weeks Quoted by Missy Talbert Office Pavilion National City Community Development FINAL PROJECT ORDER Item 107 108 109 110 111 112 113 114 115 Mfg HMI HMI HMI HMI HMI HMI HMI HMI HMI Cat 1 Part Number HEI iE3110.48F KA WL SM 11Z :03 ............... HQH 1EXISTING HQH EXISTING HHL FAV10.2015F LT KA 2F HHL FAV22.2042 HHL HEI HEI HEI LT KA F1 G5912. G6120.24NS WL .......................................... G6120.36NS WL G6120.48NS WL Part Description 1+Flip Dr (Unit,E-Style,FabricNinyl 4... +keyed alike +sandstone +on module +penumbra -Pr Cat 1 i+penumbra rhea +Lat File,Q-Pull F/S 2 Dwr 136W, Die cast mtl pull ;Skipped Option i+Lat File,Q-Pull F/S 3 Dwr 36W, Die cast mtl pull ;Skipped Option *Ped V-PuII,F/S 20D IETHO Box/Box/File 1 *light tone *keyed alike *raised height *Lat File,V-Pull F/S 2 Dwr 1ETHO 42W *light tone *keyed alike *counterweight (recommend... *Utility Tray,Ped ETHO +Task Light,E.E.,No 1ETHO Dim,AO/Pros/Etho,Canada... +sandstone +Task Light,E.E.,No 1ETHO Dim,AO/ProslEtho,Canada... +sandstone Notes ETHO ETHO 1 1 EETHO +Task Light,E.E.,No 1ETHO Dim,AO/Pros/Etho,Canada... 1 +sandstone Qty 1 List $ Ext List $ i Sell $ 5 ' $ 538.00. $ 2,690.001 $ 161.40 14 of 21 862.00 ................ 1,142.00 $ 452.00 824.00 16.001 $ 221.001 1,724.001 $ 275.84 $ 4,568.001 $ 365.44 $ 1,356.00 1 $ 236.001 $ 708.00 171.76 1,648.00 $ 313.12 48.001 221.001 251.00j $ 1,004.00 4.53i 62.54 Ext Sell $ $ 807.00 $ 551.68 $ 1,461.76 515.28 626.24 13.59 62.54 66.791 $ 200.37 71.03 284.12 C:\Documents and Settings\missy\My Documents\CAP\Projects\NATIONALCITY\FINAL ORDER.sp4 05/16/05 10:53:59 Approximate Lead Time = 6 weeks Quoted by Missy Talbert C ce Pavilion Item 116 117 118 119 120 121 122 National City Comi._.anity Development 15 0, z1 FINAL PROJECT ORDER Mfg I Cat 1 Part Number j Part Description HMI ;HCE ZERXA 1@VE Etho Sq-Edge Vinyl Frt1ETHO 'Rect WS,w/o wire/grmt,La... 24 +24"deep 52 @24" deep x 51.5" wide SZ no cbl mgmt trough, no gap LA ,+light ash LA +light ash BU i+black umber SM i+on module HMI HCE ZERXA @VE Etho Sq-Edge Vinyl Frt ETHO Rect WS,w/o wire/grmt,La... 24 +24" deep 58 @24" deep x 57,5" wide SZ @no cbl mgmt trough, no gap LA +light ash LA +light ash BU +black umber SM +on module HMI HAO A3210.1330 +Shelf,B-Style (Std) 15-1/2H ;Mailroom 13D 30W WL +sandstone HMI HAO A3210.1360 +Shelf B-Style (Std) 15-1/2H :Mailroom 13D 60W WL +sandstone 1 HMI HAO A3353.1336N +Flip Dr Unit,B-Style ;Mailroom Paint,NoLk 13D 36W 15-1/2H WL +sandstone WL +sandstone HMI AO A3353.1360N +Flip Dr Unit,B-Style Mailroom Paint,NoLk 13D 60W 15-1/2H, WL +sandstone WL +sandstone HMI HAO A0213.84 i+Wall Strip 84H Mailroom WL i+sandstone Notes List $ $ 318.00 $ 360.00 Ext List $ $ 318.00 $ 360.00 $ 145.001 $ 580.00 $ 195.00 195.001 383.001 $ 1,532.00 $ 108.39 537.001 537.001 $ 151.97 51.00i 357.00' $ 14.43 Sell $ $ 95.40 ........................: 108.001 Ext Sell $ $ 95.40 108.00 41.041 $ 164.16 55,191 $ 55.19 433.56 151.97 $ 101.01 C:\Documents and Settings\missy\My Documents\CAP\Projects\NATIONALCITY\FINAL ORDER.sp4 05/16/05 10:53:59 Approximate Lead Time = 6 weeks Quoted by Missy Talbert Office Pavilion National City Community Development FINAL PROJECT ORDER 16 of 21 Item 123 124 125 126 127 128 129 130 Mfg HMI HEI HMI HMI HMI HMI HMI W04 W04 HEI HFS HFS HAO HAO Cat Part Number E2110.2460L LA WL SM E2110.2472L LA WL SM FAV22.2030 WL KD Al ..........._. .................... FAV22.2036 WL KD F1 A3410.1236 21 02 A3410.1230 21 102 W04 1.179ACD-11/2 W04 2120 25 Part Description Notes +Work Surf,Sq-Edge ;Mailroom Rect,No Trough 24D 60W Hight ash +sandstone +on module 1+Work Surf,Sq-Edge Mailroom 1Rect,No Trough 24D 72W Hight ash +sandstone +on module +Lat File,V-Pull F/S 2 Dwr Mailroom 30W +sandstone +keyed differently +counterweight (recommend... +Lat File,V-Pull F/S 2 Dwr Mailroom 36W +sandstone +keyed differently +counterweight (recommend...' +Tackboard,B-Style 12H Mailroom 36W +grasscloth-Pr Cat 1 +grasscloth pampas +Tackboard,B-Style 12H Mailroom 30W +grasscloth-Pr Cat 1 +grasscloth pampas Adjustable Corner Diagonal Reception Standard Color Black Clip -On Mouse Palm Support For Banana Board Leatherite Color Midnight Reception Qty List $ I ., Ext List $ Sell $ Ext Sell $ 1 $ 374.001 $ 374.001 $ 112.201 $ 112.20 2 2 452.001 $ 452.00 $ 649.001 $ 1,298.00 $ 760.00 $ 104.00 $ 98.001 56.00 21.00 $ 1,520.00 $ 208.00 135.601 $ 135.60 $ 246.62 $ 493.24 288.80 577.60 29.43' $ 58.86 196.001 $ 27.73 56.001 $ 33.60 21.001 12.60 55.46 33.60 12.60 C:\Documents and Settings\missy\My Documents\CAP\Projects\NATIONALCITY\FINAL ORDER.sp4 05/16/05 10:53:59 Apr-lximate Lead Time = 6 weeks Quoted by Missy TalbPnt 0, Pavilion National City Comk.,nity Development FINAL PROJECT ORDER 17 o. Item 131 132 133 134 135 136 137 138 Mfg W04 CatPart Number I Part Description W04 2170-28TG !Pinnacle Arm, 28" W04 W04 2180S !Banana Board Platform With 1Leatherite Palm Support 'Platform Color !Black 'Palm Support 25 lMidnite HMI HST AE123AWB 1+Chair,Aeron Wk,2-Stg !Reception 1Pneu.,TIt Lim/Seat,Adj Ar... AJ .+adjustable lumbar support G1 +graphite BB +2 1/2" hard caster, black yo... BK +black 3D +pellicle® classic 13 +pellicle® classic hematite HMI HEI E1109.3030N +Frame,Npwr No Access 30H 30W WL +sandstone WL +sandstone HMI HEI E1109.3036N +Frame,Npwr No Access iReception 1 30H 36W WL +sandstone WL +sandstone HMI HEI 1E1109.3818N 1+Frame,Npwr No Access 'Reception 138H 18W 1WL l+sandstone WL l+sandstone HMI HEI E1109.5418N 1+Frame,Npwr No Access !Reception 154H 18W WL +sandstone WL l+sandstone HMI HEI E1109.7018N 1+Frame,Npwr No Access 'Reception 1 170H 18W WL i+sandstone • WL l+sandstone Notes 1 Qty List $ Ext List $ IReception ' 1 ' $ 212.00 Reception 1 189.00 $ 1 $ 1,269.00i$ 1 Reception 1 298.00 330.00 270.001 Sell $ Ext Sell $ 212.001 $ 127.201 $ 127.20 189.001 $ 113.40 $ 113.40 1,269.001 659.88 ; 659.88 298.001 89.401 89.40 330.001 $ 99.00' $ 99.00 I 270.001 81.00 81.00 I 1 1 $ 313.001 $ 313.00 $ 93.90 $ 353.00 $ 353.00! $ 105.90 $ 93.90 105.90 CADocuments and Settings\missy\My Documents\CAP\Projects\NATIONALCITY\FINAL ORDER.sp4 05/16/05 10:53:59 Approximate Lead Time = 6 weeks Quoted by Missy Talbert Office Pavilion National City Community Development 18 of 21 FINAL PROJECT ORDER Item 139 140 141 142 143 144 145 146 147 148 149 150 Mfg HMI HMI HMI HMI HMI HMI HMI HMI HMI HMI HMI HMI Cat 1 Part Number HEI E1120.30 HEI E1120.38 HEI 1E1120.54 HEI E1130.64N HEI HEI HEI HEI E1210.30 WL E1210.70 E1251.08S WL E1251.16S WL HEI 1E1222.30SN WL WL WL 1WL HEI 1E1420.0830W HEI HEI RA E1420.0836W RA E1420.1618F 121 102 Part Description +Draw Rod 30H +Draw Rod 38H +Draw Rod 54H +Wall Strip,No Wall Fastener 64H +Wall Start 30H +sandstone +Wall Start 70H +Chg of Ht Fin End Std 8H +sandstone +Chg of Ht Fin End Std 16H +sandstone +Spacer Vinyl,Npwr 30H 1Reception IReception Reception Reception Reception Reception Reception Reception Reception +sandstone +sandstone +sandstone +sandstone @Tile,Face Recut Veneer Reception 08H 30W @light ash @Tile,FaCe Recut Veneer !Reception 08H 36W @light ash +Tile,Face Fabric 16H 18W Reception +grasscloth-Pr Cat 1 +grasscloth pampas Notes I Qtyi_ List $ J Ext List $ Sell $ I 3 ; 1 1 4 1 2 1 1 $ 109.00 Ext Sell $ $ 16.00 $ 48.00 $ 4.80 $ 14.40 $ 16.00 $ 16.00 $ 4.80 $ 4.80 $ 17.00 $ 17.00 $ 5.10 $ 5.10 48.00 $ 192.00 $ 14.40 75.001 75.001 $ 22.50 : . I : • 1 ,•• 90.00 90.001 38.00 38.00! 1 42.00 $ 84.001 161.00 $ 161.00 57.60 $ 22.50 27.00 27.00 11.401 11.40 12.60 48.30 109.001 32.70 .••• 120.00 $ 120.00! 55.00 55.001 • 36.00 16.50 25.20 48.30 32.70 36.00 $ 16.50 C:\Documents and Settings\missy\My Documents\CAP\Projects\NATIONALCITY\FINAL ORDER.sp4 05/16/05 10:53:59 Approximate Lead Time = 6 weeks Quoted by Missy Tally-0 Pavilion National City Comrk-nity Development FINAL PROJECT ORDER 19 o Item 151 152 153 154 155 156 157 158 159 160 • Mfg Cat Part Number Part Description Notes HMI IHEI 1E1420.1618W 1@Tile,Face Recut Veneer Reception 16H 18W RA . :1@light ash HMI HEI E1420.1630W I@Tile,Face Recut Veneer Reception 1 144.00 16H 30W 1 IRA @light ash ... HMI IHEI E1420.0818F +Tile,Face Fabric 08H 18W Reception 1 $ 42.00 21 +grasscloth-Pr Cat 1 • 02 HMI IHEI E1420.1636W HMI HEI HMI HMI HMI HMI HMI +grasscloth pampas ••••••. : 1@Tile,Face Recut Veneer Reception 1 $ 162.06 $ 162.00T1 $ 48.60 $ 48.60 116H 36W 1 RA 1@light ash E1420.2418F +Tile,Face Fabric,24H 18W Reception 2 1 $ 70.00 $ 140.00. 21.001 42.00 Qty List $ Ext List $ I Sell $ Ext Sell $ $ 112.001 $ 1,008.001 $ 33.601 $ 302.40 $ 144.00 $ 42.00 $ 43.20 43.20 12.601 $ 12.60 21 i+grasscloth-Pr Cat 1 20 . i . . 1+grasscloth pampas •• HEI E1420.2418P '+Tile,Face Painted,24H 18W Reception 3 $ 54.00 162.00 $ 16.20 $ 48.60 HEI HE HEI HEI WL E1420.2430P +sandstone +Tile,Face Painted,24H 30W Reception 1 $ 66.001 $ 66.00 WL +sandstone E1420.2436P +Tile,Face Painted,24H 36W Reception 1 $ 72.00 $ 72.00 $ WL .A -sandstone E2110.2436L +Work Surf,Sq-Edge Reception 2 $ 249.00 498.00 Rect,No Trough 24D 36W 2X +wheat 1. WL +sandstone SM +on module E2110.2448L +Work Surf,Sq-Edge Reception 1 $ 294.00 294.00 $ 88.20 Rect,No Trough 24D 48W 2X WL SM +wheat +sandstone +on module $ 19.80 $ 19.80 21.60 $ 21.60 74.70 149.40 $ 88.20 CADocuments and Settings\missy\My Documents\CAP\Projects\NATIONALCITY\FINAL ORDER.sp4 05/16/05 10:53:59 Approximate Lead Time = 6 weeks Quoted by Missy Talbert Office Pavilion National City Community Development FINAL PROJECT ORDER 20 of 21 Item 161 162 163 164 165 166 167 168 Mfg Cat Part Number Part Description Notes ] Qty List $ Ext List $ 1 Sell $ Ext Sell $ HMI HEI E2110.2460L !Reception i 1 $ 374.001 $ 374.001 HMI HMI HMI HMI HMI HMI HMI +Work Surf,Sq-Edge Rect,No Trough 24D 60W 2X +wheat WL +sandstone SM Hon module HEI E2283.24L i+Support Panel,Wk Surf Lam,End,Glides 24D WL +sandstone HEI E2810.58W @Trans Surf,Oval Veneer TopNeneer Edge 58W RA @light ash WL +sandstone HEI E3110.24W©Flip Dr Unit,E-Style,Recut Reception Veneer 24W KD +keyed differently WL +sandstone RA @light ash SM +on module HHL FAV10.2015F Ped V-PuII,F/S 20D Reception Box/Box/File LT *light tone KD *keyed differently 2F *raised height HHL G5912. *Utility Tray,Ped Reception ;Reception Reception HEI G6120.24NS !+Task Light,E.E.,No Reception Dim,AO/Pros/Etho,Ca nad a... WL ............. 1+sandstone HIP CL11WC ©Lounge Chair,Fab,Tblt Lobby ;Arm Lt/MtI Arm Rt,Frnt Cst...1 MS 1@metallic silver UL *Geiger® natural maple 92 j@crepe-Pr Cat 2 18 +crepe aquamarine $ 274.00 1,198.00' 578.001 452.001 16.00; 221.00 548.00 112.201 $ 112.20 82.201 $ 164.40 1,198.001 $ 359.401 $ 359.40 1,156.001 16.001 1 442.001 • 173.40' 346.80 171.761 $ 171.76 4.531 $ 4.53 62.54 $ 125.08 $ 6,548.001 $ 463.271 $ 1,853.08 C:\Documents and Settings\missy\My Documents\CAP\Projects\NATIONALCITY\FINAL ORDER.sp4 05/16/05 10:53:59 Approximate Lead Time = 6 weeks Quoted by Missy Talbert C. ..:e Pavilion National City Comh.,nity Development FINAL PROJECT ORDER 21 o, _1 Item Mfg 169 OP1 170 171 OP2 Cat OP1 !ASSEMBLY 1Inside Assembly & Set Up 1 ! $ 1 OP2 1DESIGN !Normal Business Hours i . i 1Design Services i53 hours to date (5-16-05) 16 add'I hrs req'd for completion, ... 1Sales Tax (7.75%) 1 Grand Total Part Number Part Description Notes LQty j_ List $ Ext List $ Sell $ Ext Sell $ 7,875.00 $ 7,875.001 $ 7,875.00 $ 7,875.00 1 1 3,245.001 $ 3,245.00 $ 3,245.00 $ 3,245.00 0.00 $ 0.001 $ 4,238.321 4,238.32 $ 147,199.80 $ 62,171.36. C:\Documents and Settings\missy\My Documents\CAP\Projects\NATIONALCITY\FINAL ORDER.sp4 05/16/05 10:53:59 Approximate Lead Time = 6 weeks Quoted by Missy Talbert COMMUNITY DEVELOPMENT COMMISSION OF THE CITY OF NATIONAL CITY August 23, 2005 AGENDA ITEM NO. 6 TO: FROM: VIA: SUBJECT: CHAIRMAN AND BOARD MEMBERS BENJAMIN MARTINEZ, EXECUTIVE DIRECTOR BYRON ESTES, DEPUTY DIRECTOR OF REDEVELOPMENT RESOLUTION 2005-86: AUTHORIZING THE CHAIRMAN TO ENTER INTO AN EXCLUSIVE NEGOTIATION AGREEMENT WITH NC PLAZA DEVELOPMENT, LLC FOR THE DEVELOPMENT OF A MIXED -USE CONDOMINIUM AND RETAIL PROJECT ON ASSESSOR'S PARCEL NUMBERS 556-471-03, 04, 17 AND 556-553-01, 02, 03, 04, 05, 06, 08, 09, 12, AND 13. Recommendation: Community Development Commission staff recommends that the Community Development Commission Board: APPROVE Resolution No. 2005-86 authorizing the Chairman to enter into an Exclusive Negotiation Agreement with NC Plaza Development, LLC for the development of a mixed -use condominium and retail project on assessor's parcel numbers 556-471-03, 04, 17 and 556-553-01, 02, 03, 04, 05, 06, 08, 09, 12, and 13. Fiscal Impact: A fifty thousand dollar ($50,000) Negotiation Deposit will be collected to cover the costs of outside consultants during the negotiation period. No direct fiscal impacts are anticipated with this action. Environmental Impact: CEQA is not applicable to the agreement. Community Development Commission Agenda Item No. 6 August 23, 2005 Page 1 of 2 Background: Community Development Commission staff had originally negotiated a development agreement with Fred Demeo, Inc., to redevelop the Trophy Lounge bar with a new stand-alone bar and restaurant. With the adoption of the new Downtown Specific Plan, the Community Development Commission as well as the Trophy Lounge owner were approached and presented with a proposal to build a higher -density mixed -use project on the Trophy Lounge block (Phase I) and on the adjoining block to the south (Phase II). This proposed Exclusive Negotiation Agreement covers both proposed phases and includes Assessor's Parcel Numbers 556-471-03, 04, 17 and 556-553-01, 02, 03, 04, 05, 06, 08, 09, 12, and 13. An Owner Participation process was initiated on the Phase II block (National City Boulevard, Plaza Boulevard, 11th Street and A Avenue). No other owners participated and by way of this Exclusive Negotiation Agreement, the development entity NC Plaza Development, LLC, will be selected as the exclusive developer for the two phases as described herein. At this point in time, two properties are neither owned by the Community Development Commission or by the developer. These include Assessor's Parcel Numbers 556-553- 01, 02, and 03. It is probable that the developer, if unsuccessful in acquiring these two properties, will request that the Community Development Commission acquire these commercial properties through the procedures provided for by State law and as eventually adopted in the proposed Disposition and Development Agreement for the development. The proposed development will be further refined during the negotiation period. At this point in time, the proposal includes approximately eight stories on both half -blocks, seven stories of residential condominiums over one story of retail. Included in Phase I would be a replacement facility for the Trophy Lounge. With this, staff recommends that the Community Development Commission Board authorize the Chairman to enter into an Exclusive Negotiation Agreement with NC Plaza Development, LLC for the development of a mixed -use condominium and retail project on assessor's parcel numbers 556-471-03, 04, 17 and 556-553-01, 02, 03, 04, 05, 06, 08, 09, 12, and 13. ATTACHMENTS: Exhibit 1 — Resolution No. 2005-86 Exhibit 2 — Exclusive Negotiation Agreement Exhibit 3 — Initial Concept Plan Community Development Commission August 23, 2005 Agenda Item No. 6 Page 2 of 2 RESOLUTION NO. 2005-86 A RESOLUTION OF THE COMMUNITY DEVELOPMENT COMMISSION OF THE CITY NATIONAL CITY (CDC), AUTHORIZING THE CHAIRMAN TO ENTER INTO AN EXCLUSIVE NEGOTIATION AGREEMENT WITH NC PLAZA DEVELOPMENT, LLC FOR THE DEVELOPMENT OF A MIXED -USE CONDOMINIUM AND RETAIL PROJECT ON ASSESSOR'S PARCEL NUMBERS 556-471-03, 04, 17 AND 556-553-01, 02, 03, 04, 05, 06, 08, 09, 12 AND 13 WHEREAS, NC PLAZA DEVELOPMENT, LLC ("Developer") is interested in developing a mixed -use residential and retail project on the properties within the area generally bounded by National City Boulevard on the west, A Avenue on the east, the Chamber of Commerce building on the north, and 11 th Street on the south; and, WHEREAS, the developer has indicated that they need a minimum of 90 days to negotiate with the Community Development Commission concerning the type of development and terms of a Disposition and Development Agreement for sale of Agency -owned land within the proposed site; and, WHEREAS, negotiations with individual property owners will continue during the negotiation period and both parties desire to negotiate the terms of any use of Agency eminent domain authority during the period of the Exclusive Negotiation Agreement, if necessary; and, WHEREAS, the negotiation period will provide time for the developer to further refine their initial concept plan, seek equity and construction financing, and conduct market studies and analyses. NOW, THEREFORE, BE IT RESOLVED, that the Community Development Commission of the City of National City hereby authorizes the Chairman to enter into an Exclusive Negotiation Agreement with NC Plaza Development, LLC for the development of a mixed -use condominium and retail project on assessor's parcel numbers 556-471- 03, 04, 17 and 556-553-01, 02, 03, 04, 05, 06, 08, 09, 12 and 13 within the National City Redevelopment Project Area. // // // // // // EXHIBIT 1 1 PASSED AND ADOPTED this 23rd day of August 2005. ATTEST: Benjamin Martinez, Secretary APPROVED AS TO FORM: George H. Eiser, III, City -CDC Attorney Nick Inzunza, Chairman 2 EXCLUSIVE NEGOTIATION AGREEMENT BY AND BETWEEN COMMUNITY DEVELOPMENT COMMISSION OF THE CITY OF NATIONAL CITY AND NC PLAZA DEVELOPMENT, LLC a California Limited Liability Company THIS EXCLUSIVE NEGOTIATING AGREEMENT (the "Agreement') is entered into this 23rd day of August 2005, by and between the COMMUNITY DEVELOPMENT COMMISSION OF THE CITY OF NATIONAL CITY, a public body, corporate and politic (the "Agency"), and NC PLAZA DEVELOPMENT, LLC, a California limited liability company (the "Developer"), on the terms and provisions set forth below. The Agency and Developer may sometimes be referred to herein individually as "Party" and collectively as "Parties." RECITALS A. On July 18, 1995, the City Council of the City of National City (the "City") adopted the Amended Redevelopment Plan for the National City Redevelopment Project ("Previous Redevelopment Plan"); B. On February 1, 2005, the City Council of the City adopted a Downtown Specific Plan which is applicable to a portion of the National City Redevelopment Project ("Downtown Specific Plan") with respect to the National City Redevelopment Project Area (the "Redevelopment Area"); C. In furtherance of the objectives of the California Community Redevelopment Law, the Agency desires to redevelop two (2) portions of the Redevelopment Area referred to herein as Phase 1 and Phase 2. Phase 1 is located on portions of the east side of National City Boulevard between 9th Street and Plaza Boulevard (the "Phase 1 Site"). The Phase 1 Site to be redeveloped includes the property located at 999 National City Boulevard commonly known as the Trophy Lounge (the "Trophy Lounge Property") and property contiguous to the Trophy Lounge Property to the north located at 929 National City Boulevard formerly known as the Steam Bean and a vacant lot contiguous to the Steam Bean to the north commonly referred to as the Education Center lot (jointly, the "Agency Properties"). The Agency owns the Agency Properties. The total square footage of the Phase 1 land is approximately 20,125 square feet. Phase 2 is located on portions of the east side of National City Boulevard between Plaza Boulevard and 11`h Avenue (the "Phase 2 Site"). The total square footage of the Phase 2 land is approximately 36,500 square feet. The Phase 1 and Phase 2 Sites are generally depicted on Exhibit "A' attached hereto and referred to herein jointly as the "Sites." EXHIBIT 2 D. The Trophy Lounge Property is currently operated as a bar/nightclub. The Developer is the intended assignee of an option to acquire the Trophy Lounge Property or other commitment from the owner of the Trophy Lounge Property (Fred Demeo, Inc.) to contribute/sell the Trophy Lounge Property to the Developer for inclusion in the Project. This option is contingent on Fred Demeo, Inc., receiving appropriate approvals to include in the Project a restaurant development commensurate with that certain Disposition and Development Agreement between Agency and Fred Demeo, Inc. dated November _, 2003 (the "Demeo DDA"). E. Developer desires to redevelop the Trophy Lounge Property together with the Agency Properties into an integrated, mid -rise, mixed use project with street level retail uses and residential uses above on the Phase 1 Site and redevelop a similar mid -rise, mixed use project with street level retail uses and residential uses above on the Phase 2 Site (the "Project"). F. The Developer desires to enter into this Agreement with Agency to initiate exclusive negotiations with Agency for up to one hundred eighty (180) days (the "Negotiation Period") for the purposes of negotiating with Agency an owner participation agreement ("OPA") and/or a disposition and development agreement ("DDA") providing for: (i) disposition of the Agency Properties to Developer in conjunction with Developer's acquisition of the Trophy Lounge Property; (ii) due diligence activities regarding the Project; (iii) the design of the Project; (iv) the development of a schedule and financial parameters for development of the Project; (v) the preparation of environmental studies required for Project entitlements; (vi) the amendments or exemptions from the Downtown Specific Plan to increase the FAR for the site above 4.0 to accommodate the scope of the Project; and (vii) the processing of Project entitlements. If, upon the expiration of the Negotiation Period, the Developer has not signed and submitted to the Agency an OPA or a DDA (alternatively, a "Development Agreement"), then this Agreement shall automatically terminate unless the Negotiation Period has been mutually extended by the Agency and the Developer. G. If the Agency has not signed the Development Agreement by the 90th day following its submittal to the Agency, then this Negotiation Agreement shall automatically terminate unless the 90-day period has been mutually extended by the Agency and the Developer. H. Upon submittal of the executed OPA or DDA, as the case may be, by the Developer to the Agency, and provided that all environmental and entitlement applications necessary for the Project have been submitted by the Developer to the City and/or Agency, then the Negotiation Period shall be extended for a period of sixty (60) days to enable the Agency and the City to: (a) Notice and conduct a public hearing pursuant to Section 33433 of the California Health and Safety Code on the Development Agreement; and (b) Process site development, environmental and entitlement applications, as necessary, through the City's Planning Commission and City Council. 2 017.264414.4 NOW, THEREFORE, in consideration of the recitals and mutual covenants and conditions contained herein, the Parties hereto agree as follows: ARTICLE I SITE AREA During the term of this Agreement, the Parties shall work together to determine the feasibility of developing the Project on the Sites. The exact square footage of the Sites will be determined during the planning activities outlined in Section 2.1 below. ARTICLE H NEGOTIATION PERIOD 2.1. Preliminary Development Plan/Due Diligence The Negotiation Period shall commence upon the date Agency approves and executes this Agreement (the "Commencement Date") and automatically terminate one hundred eighty (180) days thereafter. During the Negotiation Period, the Parties agree to negotiate in good faith to formulate a preliminary plan for development of the Project (the "Development Plan"). (a) The Agency and Developer, as applicable, shall conduct their respective due diligence activities, including, but not limited to: (i) Developer's delivery and submission to Agency of sufficient evidence that the Developer and its intended development and construction partners has the required equity and financing letters of interest or ability to complete the Project, provided however, that the Agency understands and acknowledges the proprietary nature of the information contained in Developer' s financial statements and agrees, to the extent permitted by law (including but not limited to the Public Records Act (Government Code Section 6250 et. seq.), not to disclose said information contained therein to any person or entity other than representatives of the City or the Agency or their consultants; (ii) Developer's timely review of preliminary title report information prepared for the Sites; (iii) Developer's timely investigation of the Sites; provided that the Agency shall promptly deliver to the Developer photocopies of all due diligence materials in its possession or under its control that might reasonably assist the Developer with its investigation of the Sites. In conjunction therewith, and subject to the Developer executing a Right of Entry and Indemnification Agreement in form and content acceptable to the Agency, the Developer and its consultants and agents shall have the right to enter upon the Agency Properties to conduct appropriate tests, studies, and investigations. (iv) Developer's timely submission of a draft Development Plan to the Agency for review and comment. 3 017.264414.4 (b) The Agency shall expeditiously consider one or more alternatives to advance the Project under applicable law. The Agency in its sole discretion may implement the Project in the manner that it sees fit. The Agency shall inform the Developer on a regular basis regarding its activities and determinations under this Section 2.1(c). (c) The Agency and Developer shall cooperate in seeking a possible exemption for the Project from the Downtown Specific Plan Development Standards or amendment to the Downtown Specific Plan in order to accommodate the proposed floor area ratio for the Project. (d) The Agency and Developer shall cooperate in developing a plan to incorporate the existing Trophy Lounge redevelopment into the Project. 2.2. Development Agreement/Environmental Review/Entitlements In regard to the Developer's obligations under the Development Agreement, the Developer shall (i) submit a refined Development Plan which shall consist of greater details and specificity regarding the elements of the Project, including, without limitation, preliminary concept drawings and schematics clearly showing building footprints, elevations, design theme, preliminary landscaping, signage and lighting, parking aisles, spaces and medians, vehicular and pedestrian access ways and exits, and other factors fully descriptive of the proposed development, all to scale; and (ii) prepare and begin processing with the City any land use entitlement applications necessary for development of the Project. The Agency staff shall cooperate with Developer before the Planning Commission and City Council in any applications for land use permits and in any Land Use Element and/or Zoning Ordinance amendments which may be required. The Developer shall, however, be the applicant for all such permits and/or amendments and shall file all necessary papers and pay all fees in order to process any such proposed permits or amendments. Such cooperation by the Agency staff shall not in any way pre -commit the Agency, Planning Commission, or City Council to any decision or course of action relative to the proposed development. The Developer shall supply all information to the Agency and to the City, and shall process all documents necessary to satisfy requirements of the California Environmental Quality Act ("CEQA") and prepare any environmental documents, if any, necessary pursuant to CEQA. The Parties acknowledges that the Agency has not prepared an initial study to determine the environmental document that may be necessary under CEQA for the Project or the Development Agreement, if any. The Agency shall prepare and distribute an invitation to consulting firms to submit their qualifications to prepare any necessary CEQA documents ("EIR Consultant"), which invitation and the selection of the EIR Consultant shall be mutually agreed upon by the Agency and the Developer; provided that the consulting firm that prepared the Specific Plan EIR shall be deemed to be mutually acceptable to the Agency and the Developer. Any reference herein to an Environmental Impact Report ("EIR") shall include other CEQA documents such as a secondary study or mitigated negative declaration if appropriate. The Agency shall enter into the agreement for the preparation of any necessary EIR with the EIR 4 017.264414.4 Consultant, and the Developer shall be solely responsible for the EIR Consultant's fees and all costs associated therewith. Upon selection of the EIR Consultant, Developer shall have the right to review the progress of the EIR Consultant with respect to the preparation of the EIR as more particularly described below. Upon completion of each stage of preparation of the EIR, including the preparation of working papers, a proposed outline, first draft, and any revised drafts of the EIR, the EIR Consultant shall deliver a copy of each such work produced to Developer. Developer shall have the right to review each such work produced and provide feedback and input to the EIR Consultant. 2.3. Scope of the Development Agreement. The Parties acknowledge and agree that during the term of this Agreement, as such term may be extended pursuant to Section 2.5 below, that they shall use their respective good faith efforts to negotiate and enter into a Development Agreement which shall include, but not be limited to, the following: (a) The design of the Project by the Developer, which design shall be subject to approval by the Agency, and, if necessary, the City; (b) The construction of the Project by the Developer and its intended development and construction partners in accordance with final plans and specifications to be provided by the Developer and approved by the Agency and the City pursuant to a detailed schedule of performance; (c) The operation and management of the Project by the Developer in a good and professional manner; (d) The maintenance of landscaping, buildings, and improvements in good condition and satisfactory state of repair; (e) The right of the Agency to reenter and reacquire the Sites in the event of a material breach or default under the Development Agreement; (f) A prohibition against the Developer engaging in land speculation and a remedy in the event such land speculation occurs; (g) The operation of the Project by the Developer in compliance with all equal opportunity standards established by Federal, State, and local law; (h) The right of the Agency, and the City to inspect the Project from time to time to assure compliance with these provisions; (i) A section providing that, upon the Agency's request, the Developer shall give to the Agency copies of concepts, schematics, and the final plans and working drawings for the Project, and that the Developer shall participate in presentations with respect to the Project; and 5 017.264414.4 (j) That the Project shall be of the highest quality and standard. 2.4. Need for Development Agreement; Exclusivity of Negotiations The Agency agrees that during the Negotiation Period, the Agency shall not negotiate or enter into an agreement with any other person or entity regarding development of the Sites. The obligation to negotiate in good faith requires the respective Party to communicate with each other with respect to those issues for which agreement has not been reached, and in such communication to follow reasonable negotiation procedures, including meetings, telephone conversations, and correspondence. The Parties understand that final accord on all issues may not be reached. It is also understood that, (1) neither Party is under any obligation to reach agreement on the Development Plan and/or Development Agreement, and (2) the Board of Directors of the Agency ("Agency Board") reserves the right to approve or reject a Development Agreement, the Project, or any disposition of the Sites in its sole discretion, as more particularly set forth in Article IV of this Agreement. 2.5. Extension of the Negotiation Period If, at the close of the Negotiation Period, the Developer has not executed and submitted a Development Agreement to the Agency and the Agency Board has not approved and executed the Development Agreement, this Agreement shall automatically terminate. Notwithstanding the foregoing, (i) the Negotiation Period shall be automatically extended upon the circumstances set forth in Recital H, and (ii) the Agency's Executive Director, reserves the right in his or her sole discretion, to extend in writing the Negotiation Period for up to two (2) additional periods of ninety (90) days each. No further approval of the Agency Board is required for the Executive Director to exercise his or her right to extend the Negotiation Period as provided for herein. 2.6. Agency and Developer Obligations During the Negotiation Period, Agency and Developer obligations shall include, but not be limited to, without limitation of other obligations set forth in this Agreement, the following: (a) Agency Obligations (i) Negotiate through its staff exclusively with Developer in connection with the redevelopment of the Sites; (ii) Review the Project plans and determine consistency with the General Plan, Downtown Specific Plan, zoning and other relevant land use regulations on the proposed Sites including any changes or exemptions needed for the feasibility of the Project; (iii) Provide the Developer with documents in Agency's possession that would assist the Developer with the due diligence activities described in this Agreement; (iv) Verification of Developer financial commitments to both purchase the Sites and develop the Project, as outlined in Section 2.1 of this Agreement, subject to Article 6 017.264414.4 IV below, negotiate and prepare a Development Agreement and review and consider the Development Plan; (v) Interface with and business owners and residents within the Project Area, if appropriate, pursuant to the Agency Rules; (b) Developer Obligations (i) Use its best efforts to investigate the Sites; (ii) Submit, and revise as necessary, the Development Plan, elevations, schematic drawings, estimated Project development costs, phasing plans, Project proformas for individual product types, post -phasing plans, a draft market study and other documents necessary for Agency and City review; (iii) Submit at the appropriate time proof of equity, construction partners and financing letters of interest that demonstrate sufficient capital to fund acquisition and development of the Project; (iv) Provide written reports advising the Agency on progress and/or problems with the proposed development every thirty (30) days during the Negotiating Period; and (v) Secure the acknowledgement of Fred Demeo, Inc. of the termination of the Demeo DDA. ARTICLE III DEVELOPER DEPOSIT As a condition precedent to the Agency's execution of this Agreement, Developer has tendered to Agency, and Agency has accepted, a deposit ("Negotiation Deposit") in the amount of Fifty Thousand Dollars ($50,000), in the form of a cashier's or certified check, or wire transfer, payable to Agency. Agency agrees to deposit the Negotiation Deposit in the Agency's account and make disbursements therefrom only pursuant to the terms and provisions of this Agreement. Developer agrees that Agency may use the Negotiation Deposit to reimburse itself for its reasonable and actual costs incurred after the execution of this Agreement for outside attorneys' fees, outside consultant fees, appraisal fees, title reports, and any other related fees and costs, but not including the cost of Agency or City staff, incurred by the Agency in (i) negotiating, preparing and reviewing any documents submitted in furtherance of this Agreement and/or Developer's proposal to develop the Project, (ii) any negotiations relating to the Development Agreement and any related documents and (iii) drafting the Development Agreement or any other related documents (the "Agency Project Costs"). Agency shall submit to Developer invoices reasonably detailing the Agency Project Costs Agency has incurred at the time it submits a reimbursement notice to the Developer. Agency shall be free, but is not obligated, to withdraw funds from the Negotiation Deposit, as needed, provided that it has submitted such invoices to the Developer. The Negotiation Deposit, less the Agency Project Costs, shall be refundable to Developer in the event this Agreement is terminated prior to the 7 017.264414.4 execution of the Development Agreement in exchange for Developer granting all of its rights title and interest in all studies and reports in connection with the Sites to Agency to the extent Developer is legally permitted to do so. In the event the Development Agreement is fully executed and approved by all requisite action, the balance of Negotiation Deposit, if any, shall be either returned to Developer or applied as a credit against amounts, if any, to be paid by Developer to Agency pursuant to the Development Agreement. ARTICLE IV RETENTION OF DISCRETION TO APPROVE THE PROJECT AND DEVELOPMENT AGREEMENT; NO PRE -COMMITMENT The Parties understand that the Agency is reserving the right to exercise its discretion as to all matters which it is, by law, entitled or required to exercise its discretion, including, but not limited to the following: 4.1. Approval by the Agency of the Final Project as Contained in the Development Agreement The Parties understand that the Agency has the complete and unfettered discretion to reject the Development Plan and/or Development Agreement without explanation or cause. The risk of loss of the Negotiation Deposit and all costs and expenses incurred by the Developer shall be absorbed entirely by Developer. 4.2. Review and Approval by the Agency or City of all Discretionary Findings and Conclusions Any Development Agreement that may be negotiated is subject to a public hearing by the Agency and the City. The decision of the Agency and City regarding the Development Agreement shall be conditioned upon the successful review and approval of all necessary findings and conclusions which the Agency Board and City are required to make, including all necessary findings and determinations required under CEQA, state and local land use provisions, and the California Community Redevelopment Law. As to any matter regarding which the Agency or City may be required to exercise its discretion in advancing the Project to completion, neither anything herein, nor to be contained in the DDA shall obligate the Agency or City to exercise its discretion in any particular manner, and any exercise of discretion reserved hereunder or required by law, shall not be deemed to constitute a breach of Agency duties under this Agreement. 4.3. No Pre -Commitment by Agency or City By its execution of this Agreement, neither the Agency nor the City is committing itself or agreeing to undertake any activity requiring the subsequent exercise of discretion by the Agency or City, or any department thereof, including, but not limited to, the approval and execution of a Development Agreement; amendment or approval of any land use regulation governing the Sites, the authorization or obligation to use the Agency's or City's eminent domain authority or any other such activity; or the provision of financial assistance for the development of any public or private interest in real property. This Agreement does not 8 017.264414.4 constitute a disposition of property or exercise of control over property by the Agency or City and does not require a public hearing. ARTICLE V THE DEVELOPER 5.1. Developer Experience As a condition precedent to Agency' s execution of this Agreement, Developer shall have submitted to Agency a detailed description of the development experience of the Developer and its principals, associates, employees, partners, and joint venturers. 5.2. Offices of the Developer The principal offices of Developer are located at: NC Plaza Development, LLC Attention: James Lee Boyd 2500 6th Avenue, Suite 107 San Diego CA 92103 The name of the Project, architect, contractor, consultants, or representatives who are proposed to be directly involved in the Project will be determined by Developer and submitted to Agency upon any such determination for Agency approval. 5.3. Full Disclosure The Developer shall maintain full disclosure to the Agency as to the identity of its principals, officers, stockholders, partners, joint ventures, and all other pertinent information concerning the Developer. 5.4. Assignment The Developer without prior written approval of the Agency, which approval may be withheld or conditioned in the Agency's sole and absolute discretion, may not outright assign this Agreement. The Agency agrees however, that, notwithstanding the foregoing, the Developer may assign its rights under this Agreement to a limited liability company, corporation, trust, or partnership of which the Developer owns a substantial beneficial interest and/or has operational control with the Agency's prior written approval, which approval shall not be unreasonably withheld. ARTICLE VI REAL ESTATE COMMISSIONS The Agency has not engaged a broker, agent, or finder in connection with this transaction. As such, the Agency will not be responsible for any claims by a broker, agent or 9 017.264414.4 finder, and the Developer agrees to defend, indemnify, and protect and hold the Agency harmless from any claim by any broker, agent, or finder retained by the Developer. ARTICLE VII GENERAL PROVISIONS 7.1. Applicable Law The laws of the State of California shall govern the interpretation and enforcement of this Agreement. 7.2. Acceptance of Service of Process In the event that any legal action is commenced by Developer against Agency, service of process on Agency shall be made by personal service upon the Executive Director or Secretary of Agency, or in such other manner as may be provided by law. In the event that any legal action is commenced by Agency against Developer, service of process on Developer shall be made by personal service upon Developer or in such other manner as may be provided by law, and shall be valid whether made within or without the State of California. 7.3. Rights and Remedies are Cumulative Except as otherwise expressly stated in this Agreement, the rights and remedies of the Parties are cumulative, and the exercise by either Party of one or more of its rights or remedies shall not preclude the exercise by it, at the same or different times, of any other rights or remedies for the same default or any other default by the other Party. 7.4. Specific Performance as Developer's Exclusive Remedy Subject to Developer's right to terminate this Agreement in accordance with the terms of Section 7.6 below, Developer's exclusive remedy for an uncured Agency default under this Agreement is to institute an action for specific performance of the terms of this Agreement, including the return of the Negotiation Deposit, and in no event shall Developer have the right, and Developer expressly waives the right, to seek monetary damages of any kind (including but not limited to actual damages, economic damages, consequential damages, or lost profits) from Agency in the event of a default by Agency under this Agreement or any action related to this Agreement. Notwithstanding the foregoing, Developer shall retain the right to seek a writ of mandate in the event of any final denial by Agency of any Agency permit or approval pertaining to the Project. 7.5. Attorney's Fees If either Party to this Agreement initiates or defends litigation in any way connected with this Agreement, the prevailing party in such litigation, in addition to any other relief which may be granted, whether legal or equitable, shall be entitled to its actual and reasonable attorney's fees. As used herein, the term "attorney's fees" shall include attorney's fees incurred related to the foregoing described litigation and for any appeal, and in addition a 10 017.264414.4 Party entitled to attorney's fees shall be entitled to all other reasonable costs for investigating such action, retaining expert witnesses, taking depositions and discovery, and all other necessary costs incurred in such litigation. All such fees shall be deemed to have accrued on commencement of such action and shall be enforceable whether or not such action is prosecuted to judgment. 7.6. Termination Rights Notwithstanding the nominal Negotiation Period hereinabove set forth, either Party may terminate this Agreement if the other Party has materially defaulted in its obligations herein set forth, and the terminating party has provided the defaulting party with written notification of such determination, and the defaulting party has refused to cure same. The written notification shall set forth the nature of the actions required to cure such default if curable. The defaulting party shall have thirty (30) days from the date of the written notification to cure such default. If such default is not cured within the thirty (30) days, the termination shall be deemed effective. For purposes of this paragraph, the Parties hereby acknowledge that time is of the essence. Each Party shall also have the right to terminate this Agreement in the event that (a) Agency or Developer determines that the Project is infeasible, based on financial or environmental impact considerations, or not in the public interest; or (b) the Parties reach an impasse in their negotiation of the Development Agreement. 7.7. Indemnity Developer shall indemnify, protect, defend and hold harmless Agency and City and Agency's and City's respective elected officials, officers, employees, representatives, members, and agents from and against any and all challenges to this Agreement, and any and all losses, liabilities, damages, claims or costs (including attorneys' fees) arising from Developer's negligent acts, errors, or omissions and willful misconduct with respect to its obligations hereunder, excluding any such losses arising from the sole negligence or sole willful misconduct of the Agency. This indemnity obligation in connection with events occurring prior to the termination of this Agreement shall survive the termination of this Agreement. 7.8. Notices, Demands and Communications Between the Parties Formal notices, demands, and communications between Agency and Developer shall be given either by (i) personal service, (ii) delivery by reputable document delivery service such as Federal Express that provides a receipt showing date and time of delivery, (iii) facsimile with a hard copy sent by United States mail; or (iv) or by mailing in the United States mail, certified mail, postage prepaid, return receipt requested, addressed to: To Agency: Community Development Commission 140 E. 12th Street, Suite B National City, CA 91950 Attn: Benjamin Martinez, Executive Director Phone: (619) 336-4256 Fax: (619) 336-4286 017.264414.4 11 With copy to: To Developer: With a copy to: Foley & Lardner LLP 402 W. Broadway, Suite 2300 Attn: Richard L. Moskitis Phone: (619) 685-6439 Fax: (619) 234-3510 NC Plaza Development, LLC Attention: James Lee Boyd 2500 6th Avenue, Suite 107 San Diego CA 92103 Phone: (858) 395-6352 Fax: (858) 546-4936 Smaha & Daley Attention: John L. Smaha 7860 Mission Center Court, Suite 100 San Diego, CA 92108 Phone: (619) 688-1557 Fax: (619) 688-1558 Notices personally delivered, sent by fax with a confirmation by United States mail or delivered by document delivery service shall be deemed effective upon receipt. Notices sent solely by mail in the manner provided above shall be deemed effective on the second business day following deposit in the United States mail. Such written notices, demands, and communications shall be sent in the same manner to such other addresses as either Party may from time to time designate by mail. 7.9. Nonliability of City and Agency Officials and Employees No member, official, employee, or contractor of City or Agency shall be personally liable to Developer in the event of any default or breach by Agency or for any amount, which may become due to Developer or on any obligations under the terms of the Agreement. 7.10. Interpretation The terms of this Agreement shall be construed in accordance with the meaning of the language used and shall not be construed for or against either Party by reason of the authorship of this Agreement or any other rule of construction which might otherwise apply. The part and paragraph headings used in this Agreement are for purposes of convenience only, and shall not be construed to limit or extend the meaning of this Agreement. 7.11. Entire Agreement, Waivers, and Amendments This Agreement integrates all of the terms and conditions mentioned herein, or incidental hereto, and supersedes all negotiations or previous agreements between the Parties with respect to all or any part of the subject matter hereof. All waivers of the provisions of this Agreement must be in writing and signed by the appropriate authorities of the Party to be 12 017.264414.4 charged, and all amendments and modifications hereto must be in writing and signed by the appropriate authorities of Agency and Developer. 7.12. Counterparts This Agreement may be executed in counterparts, each of which, after all the Parties hereto have signed this Agreement, shall be deemed to be an original, and such counterparts shall constitute one and the same instrument. 7.13. Successors This Agreement shall be binding upon and shall inure to the benefit of the permitted successors of each of the Parties hereto. 7.14. Severability In the event any section or portion of this Agreement shall be held, found, or determined to be unenforceable or invalid for any reason whatsoever, the remaining provisions shall remain in effect, and the Parties hereto shall take further actions as may be reasonably necessary and available to them to effectuate the intent of the Parties as to all provisions set forth in this Agreement. 7.15. Time is of the Essence Time is of the essence for each of the Parties' obligations under this Agreement. 7.16. Recitals The recitals set forth above are incorporated herein by this reference. 7.17. Confidentiality Developer acknowledges and agrees that Agency is a public entity with a responsibility and, in many cases, legal obligation to conduct its business in a manner open and available to the public. Accordingly, any information provided by Developer to Agency with respect to the Site, the Project or Developer may be disclosed to the public either purposely, inadvertently, or as a result of a public demand or order. With respect to any information provided that Developer reasonably deems and identifies in writing as proprietary and confidential in nature, Agency agrees to exercise its best efforts to keep such information confidential. Remainder of Page Intentionally Left Blank 13 017.264414.4 IN WITNESS WHEREOF, the Agency and the Developer have signed this Agreement on the respective dates set forth below. AGENCY: A 1'1EST: Agency Secretary, Benjamin Martinez APPROVED AS TO FORM: Agency Special Counsel Foley & Lardner LLP By: Richard L. Moskitis COMMUNITY DEVELOPMENT COMMISSION OF THE CITY OF NATIONAL CITY, a public body, corporate and politic By: Nick Inzunza, Chairman DEVELOPER: NC Plaza Development, LLC, a California limited liability company By: Lee Boyd, Managing Member By: John L. Smaha, Managing Member Signature Page to Exclusive Negotiation Agreement 14 017.264414.4 1 , (NATIONAL AVE), EXHIBIT A SITE MAP EIGHTH — _ 2 3 r' cos Ac 4$g -SLK- 6 7: 8 ~ 9 i0 ..s S NINTH 20 „� h 19 18 17 a +I6 o`ccnc` I5 14 12 471 t5 18 PLAZA ELEVENTH M N$ ti 1 !a 2 3 /,Y ap 18 ID4 uws [z7 M1424S I4 SEE DETAIL 'Y jor ! vs sac 154 Isms • LOT a SEC !SA M 4 -ST: n$ • 20 fi 0. at _19 PAR ! -4 18 —?;3) 4 80 SO is A77•01'/0'.f 2 s w •cases sr •AyA'! 17 16 15 14 13 12 15 !, 14 auA4 017.264414.4 A-1 Corceptu:11 Project By BCC Inte'natiord Salerno • Livingston Architects NATIONAL CITY PLAZA PHASE 1 FLOOR GROSS GROSS SELABLE COMMON EFFICC. (%) PARKING RETAIL 1 RETAIL 2 UNIT A UNIT B 1Bed/ 1Bath UNIT C 2Bed/2Bath Media ENCLOSED OPEN TOTAL STALLS 1Bed/ 1Bath Media 766 724 1,184 P3 22,404 0 22,404 60 P2 22,404 0 22,404 61 P1 22,404 0 22,404 51 TOTAL 67,211 0 67,211 GF L2 17,458 13,187 0 17,458 15,400 2,058 88% 2 11,500 3,900 2,026 15,213 12,076 3,137 79% 11 1 L3 L4 13,187 13,187 2,026 15,213 12,076 3,137 79% 11 1 2,026 15,213 12,076 3,137 79% L5 13,187 2,026 15,213 12,076 3,137 79% 11 1 L6 12,874 2,339 15,213 11,769 3,443 77% 11 10 1 1 L7 8,492 1,970 10,462 8,005 2,456 77% L8 8,492 1,970 10,462 8,005 2,456 77% 8 TOTAL 8 100,064 14,381 114,445 91,482 22,963 80% 174 11,500 3,900 70 4 1 TOTAL UNIT S.F. 53,628 2,896 1,184 8/10/2005 UNIT D 2Bed/ 2Bath Media UNIT E 2Bed/ 2bath Media UNIT F 1Bed/ 1Bath TOTAL UNIT COUNT 1,163 1,048 713 TOTAL UNIT SQ. FT. 1 1 1 1 1 1 1 1 1 15 1 1 1 1 15 15 1 1 15 1 1 14 1 10 12,076 12,076 12,076 12,076 11,769 1 10 7 5 7 94 8,005 8,005 8,144 5,240 4,990 76,082 LOBBY 11,500 S.F. POTENTIAL RESTAURANT SPEED RAMP UP TO STREET SPEED RAMP ON TO PARKING DN UP UP L._ NATIONAL CITY PLAZA PHASE 1 CONCEPTUAL PROJECT BY BCG International 3,900 S.F. f P DN 2' UP _J CHAMBER OF COMMERCE N.N Ground Floor level SCALE:I/W=1V Salerno/ Uvkigston Architects 1131 10 Awl 2ons NATIONAL CITY PLAZA PHASE 1 CONCEPTUAL PROJECT BY BCG International KEY Enclosed Sq Ft r7772 OW Sq Ft um Floor level 2 SCALE : 1/16W-0' 5aJ. to/UvIngs Qn Architects ea 1n oi,n onns NATIONAL CITY PLAZA PHASE 1 CONCEPTUAL PROJECT BY BCG International KEY Enclosed 8q R p772 Open Bq Ft Ewa Floor level 3-5 SCALE : 1116".1-0' Salerno/ Uvingston Architects di 1nAiinonn1 NATIONAL CITY PLAZA PHASE 1 CONCEPTUAL PROJECT BY BCG International KEY Enclosed Sq Ft 777i1 OW Sq Ft Floor level 6 SCALE :1/16'=1'-0' Salerno / Uvingston Architects 0 10 Aua 2005 MMJNDN DN NATIONAL CITY PLAZA PHASE 1 CONCEPTUAL PROJECT BY BCG International NITA C NI IT A I❑ UNIT: 7IINPs EI CI 1 UNIT F UP _ DN UP KEY Enclo..d $q Ft L777 Op•n Sq Ft assa Floor level 7-8 SCALE :1/16'=1-0' Salerno/ Uvl gston Architects 0 10 Auo 2005 DN • 0 IQ (SPEED RAMP UP TO STREET DN SPEED RAMP DN TO P RKING DN DN UP UP STORAGE 15 \ DN 8 DN UP ATIONAL CITY PLAZA PHASE 1 CONCEPTUAL PROJECT BY BCG International Parking level P1 SCALE :1/16'=1'-0' Salerno / Uvingston Architects CI 10 Ai n 9M5 DN P DN UP 15 UP 0 STORAGE 15 1 DN 8 P DN UP NATIONAL CITY PLAZA PHASE 1 CONCEPTUAL PROJECT BY BCG International Parking level P2 satz:1i1e..1.4r Salome / Uvingston Architects el 10 Aua 2005 UP UP 15 UP J0 17 UP STORAGE UP 8 UP UP k-+TIONAL CITY PLAZA PHASE 1 CONCEPTUAL PROJECT BY BCG International Parking level P3 SCALE :1116'=1'-0" Salome / UvIngston Archltects El 1nAim 9nn5 TIONAL CITY PLAZA PHASE 1 CONCEPTUAL PROJECT BY BCG International CEO 00 L_ 0 L 1 11 1 UNIT A 766 Sq Ft Salerno/ Uvingston Architects UNIT A SCALE: 1/4'..-V-0' o 10 Aur, mns NATIONAL CITY PLAZA PHASE 2 PROJECT DATA F.A.R. LOT S.F. TOTAL ALOW. 4 53,100 212,400 5 53,100 265,500 5.25 53,100 278,775 LEVEL 1 1- RES 2 3 4 5 6 7 8 TOTAL OPTION 2 I UNIT # GROSS S.F. N/A 23,488 20 15,454 24 34,250 32 35,364 32 31,164 32 31,164 25 24,078 25 24,078 18 16,950 208 235,990 NATIONAL CITY BLVD RETAIL E ZW 1'. ATIONAL CITY PLAZA PHASE 2 CONCEPTUAL PROJECT BY BCG International TWO STORY TOWNHOMES COURTYARD THREE STORY TOWNHOMES AVENUE A Ground Floor level SCALE :1/32'=f-0• 5alanq/lJvIgston Ards 0 10 Auq 2005 NATIONAL CITY BLVD m 1 m m .TIONAL CITY PLAZA PHASE 2 CONCEPTUAL PROJECT BY BCG International SCALE:1132 =1'-0' TWO STORY TOWNHOMES THREE STORY TOWNHOMES AVENUE A Level 2 Salorno/Uvingsten Architects a 10 Aug 2005 NATIONAL CITY BLVD m 1 m m kATIONAL CITY PLAZA PHASE 2 CONCEPTUAL PROJECT BY BCG International TOW VHOME S ONLY OCCUR, ON LEVEL 3 1HREE STORY TOWNHOMES AVENUE A Level 3-5 SCALE :1/3Y=1'-0' Salerno/UvIngsten Architects 0 10 Aug 2005 NATIONAL CITY BLVD m r m m k.-TIONAL CITY PLAZA PHASE 2 AVENUE A CONCEPTUAL PROJECT BY BCG International Level 6-7 SCALE:1l3Y=T-0' Saa na/UJvlrgsbon Ardent. 0 10��� NATIONAL CITY BLVD m r m m f i.ATIONAL CITY PLAZA PHASE 2 CONCEPTUAL PROJECT BY BCG International AVENUE A j Level 8 SCALE: U32"=P-0' Siderno/UvIngston Architects 0 10 Aug 2005 NATIONAL CITY PLAZA PHASE 1 R. PHASE 2 CONCEPTUAL PROJECT BY BCG International View of National City Blvd. & Plaza Blvd. Salerno/ UvIngston Architects COMMUNITY DEVELOPMENT COMMISSION OF THE CITY OF NATIONAL CITY August 23, 2005 AGENDA ITEM NO. 7 TO: CHAIRMAN AND BOARD MEMBERS FROM: BENJAMIN MARTINEZ, EXECUTIVE DIRECTOR VIA: ROBERT PAZ, DEPUTY DIRECTOR OF COMMUNITY AND ECONOMIC DEVELOPMENT SUBJECT: REPORT: UPDATE AND PRESENTATION OF FILIPINO VILLAGE PROJECTS Recommendation: Community Development Commission staff recommends that the Community Development Commission Board: ACCEPT AND FILE the update and presentation of Filipino Village Projects. Fiscal Impact: There will be no fiscal impact as a result of this action. Environmental Impact: CEQA is not applicable to this action. Background: On August 16, 2005 City Engineer, Steve Kirkpatrick, made a presentation to the City Council on the direction of the widening of Plaza Boulevard. The potential project will increase traffic flow on Plaza Boulevard. The Community Development Commission Board approved funding for the development of Filipino Village in the Fiscal Year 2005-2006. Community Development Commission staff has created a presentation for the Community Development Commission Board to demonstrate the concerted efforts that will work in tandem to achieve a sense of place and destination point along Plaza Boulevard. Community Development Commission Agenda Item No. 7 August 23, 2005 Page 1 of 2 With this, Community Development Commission staff recommends that the Community Development Commission Board accept and file the update and presentation of Filipino Village Projects. Community Development Commission Agenda Item No. 7 August 23, 2005 Page 2 of 2 City of National City COUNCIL AGENDA STATEMENT MEETING DATE: August 23, 2005 AGENDA ITEM NO. 8 ITEM TITLE: RESOLUTION OF THE CITY COUNCIL APPROVING THE HEALTH AND SAFETY CODE SECTION 33433 REPORT; APPROVING THE DISPOSITION AND DEVELOPMENT AGREEMENT BY AND BETWEEN THE COMMUNITY DEVELOPMENT COMMISSION AND MOSSY NISSAN, INCORPORATED FOR DEVELOPMENT OF A NEW CAR DEALERSHIP AT 2626 THROUGH 2700 NATIONAL CITY BOULEVARD; AND MAKING CERTAIN FINDINGS IN CONNECTION HEREWITH PREPARED BY: Benjamin Martinet DEPARTMENT Community Development Commission Executive Director Mossy Nissan, Incorporated proposes to develop a new automobile dealership on a 4.53 acre site lo- cated at 2626 through 2700 National City Boulevard in the National City Mile of Cars. To facilitate de- velopment of this proposed project, a Disposition & Development Agreement has been prepared, which is being processed pursuant to the requirements of the California Redevelopment Law (California Health and Safety Code Section 33000 et seq.). A Supplemental Staff Report has been prepared and attached to provide more information on the proposed Mossy Nissan Project. A Public Notice was published in the National City Star News on August 5 and 12, 2005. Environmental Review N/A• The City Council adopted the Combined General Plan/Zoning Map on September 10, 1996 with Amendments GP-2000-1,2,3 and GP-2001-2 and GP-2002-1. The project is consistent with the Certi- fied Environmental Impact Report adopted for the Combined General Plan/Zoning Map. Pursuant to Section 15183 of the California Environmental Quality Act Guidelines, the project is deemed exempt from further CEQA review. Financial Statement The DDA anticipates no public expenditures. / • STAFF RECOMMENDATION Approve the Resolution. BOARD/COMMISSION RECOMMENDATION None. ATTACHMENTS (Listed Below) 1. Resolution 2005-184 Resolution No. RESOLUTION NO. 2005 — 184 RESOLUTION OF THE CITY COUNCIL OF THE CITY OF NATIONAL CITY APPROVING THE HEALTH AND SAFETY CODE SECTION 33433 REPORT, APPROVING THE DISPOSITION AND DEVELOPMENT AGREEMENT BY AND BETWEEN THE COMMUNITY DEVELOPMENT COMMISSION AND MOSSY NISSAN, INCORPORATED, AND MAKING CERTAIN FINDINGS IN CONNECTION THEREWITH WHEREAS, the Community Development Commission of National City ("CDC") is a public body, corporate and politic, organized and existing under the California Community Redevelopment Law (Health & Safety Code Section 33000 et seq.); and WHEREAS, on June 20, 1995, pursuant to Resolution No. 95-98, the City Council of the City of National City (the "City" or "City Council") certified the completion of a Final Environmental Impact Report ("EIR") for the Redevelopment Plan for the National City Redevelopment Project; and WHEREAS, pursuant to the Community Redevelopment Law, on July 18, 1995, pursuant to Ordinance No. 95-2095 the City Council approved and adopted the Redevelopment Plan for the National City Redevelopment Project; and WHEREAS, the Community Development Commission of the City of National City (the "CDC") is engaged in activities necessary to execute and implement the Redevelopment Plan (the "Redevelopment Plan") for the National City Redevelopment Project (the "Redevelopment Project"); and WHEREAS, the Implementation Plan adopted by the CDC with respect to the Redevelopment Project Area calls for the CDC's objective to "increase private investment wherever possible, to promote jobs, and improve the property and sales tax base of the City"; and WHEREAS, in furtherance of the objectives of the Community Redevelopment Law, the CDC desires the redevelopment of certain real property within the Redevelopment Project Area, located at 2626 through 2700 National City Boulevard, for a new car dealership; and WHEREAS, the development contemplated is consistent with the EIR for the Redevelopment Plan for the National City Redevelopment Project, and therefore is exempt from further California Environmental Quality Act ("CEQA") review under Section 15180 of the CEQA Guidelines; and WHEREAS, the Dailey Family Partnership owns in fee the real property commonly known as 2626 through 2700 National City Boulevard (the "Site"); and WHEREAS, Mossy Nissan, Inc., a California corporation ("Mossy"), is currently the lessee of the Site and desires to purchase the Site in order to construct a new car dealership; and Attachment 1 Resolution 2005 —184 August 23, 2005 Page 2 WHEREAS, CDC staff has negotiated a Disposition and Development Agreement including attachments thereto (collectively, the "DDA") with Mossy for the CDC's disposition of the Site to Mossy, if necessary, and subject to the discretion of the CDC; and WHEREAS, pursuant to the terms of the DDA, Mossy shall construct a $3 Million ($3,000,000) new car dealership on the Site; and WHEREAS, CDC staff has presented the draft DDA to the CDC Board and City Council for consideration; and WHEREAS, the Community Redevelopment Law, at Health and Safety Code Section 33433, requires that (i) the CDC prepare a Summary Report concerning the CDC's proposed disposition of the Site as set forth in the DDA, (ii) the CDC Board and the City Council conduct a noticed joint public hearing with respect to the DDA, and (iii) the approval of the DDA be set forth in a resolution making certain findings and determinations as set forth herein below; and WHEREAS, pursuant to the requirements of Section 33433 of the Community Redevelopment Law, a Summary Report for the DDA has been prepared by the CDC's economic consultant Keyser Marston Associates, Inc.; and WHEREAS, a joint public hearing of the CDC Board and City Council has been noticed and conducted in accordance with applicable requirements of law; and WHEREAS, at the joint public hearing the CDC and the City Council each considered all of the information, testimony, and evidence presented, including but not limited to the draft DDA, in the form presented by CDC staff concurrent with consideration of the Resolution, the CDC staff report, the Summary Report, and the oral and written testimony received from persons wishing to appear and be heard concerning the proposed DDA. NOW, THEREFORE, THE CITY COUNCIL OF NATIONAL CITY HEREBY RESOLVES AS FOLLOWS: 1. Based on all the information, testimony, and evidence presented at the joint public hearing, including but not limited to the draft DDA and the information and evidence set forth in the CDC staff report, the Summary Report, and the oral and written testimony received, the City Council finds and determines as follows: herein. a. That the above Recitals are true and correct and are incorporated b. That the DDA effectuates the purposes of the Community Redevelopment Law (Health & Safety Code Section 33000 et seq.), and of the Redevelopment Plan, and is in the best interests of the citizens of National City. Resolution 2005 — 184 August 23, 2005 Page 3 c. That the CDC's disposition of the Site pursuant to the DDA will assist in the elimination of blight. d. That the CDC's disposition of the Site pursuant to the DDA is consistent with the Redevelopment Plan and the National City General Plan. e. That the DDA is consistent with the Implementation Plan for the Redevelopment Plan. f. That any consideration Mossy will pay for the Site is not less than the fair market value or the fair reuse value of the Site at the use and with the covenants and conditions and development costs authorized by the disposition. 2. That the Summary Report for the DDA required by Health and Safety Code Section 33433 is hereby approved. 3. The DDA, a true and correct copy of which is on file with the City Clerk/CDC Secretary, is hereby approved. 4. The City Council consents to (i) the authorization and direction given by the CDC to its Executive Director and CDC Counsel to make final modifications to the DDA that are consistent with the substantive terms of the DDA approved hereby, (ii) the authorization and direction given to the CDC Chairperson to thereafter sign the DDA on behalf of the CDC, and (iii) the authorization and direction given by the CDC to their Executive Director to take such other and further actions as may be necessary and proper to carry out the terms of the DDA and the purpose of this Resolution, including but not limited to signing such other and further documents, including the documents attached as exhibits to the DDA. 5. The Executive Director of the CDC is directed to file a Notice of Exemption with the County Clerk confirming the project is exempt from further CEQA review. PASSED AND ADOPTED this 23rd day of August, 2005. Nick Inzunza, Mayor ATTEST: APPROVED AS TO FORM: Michael Dalla, City Clerk George H. Eiser, III City Attorney MEETING DATE (-ITEM TITLE City of National City, California COUNCIL AGENDA STATEMENT 8/23/05 AGENDA ITEM NO. 9 RESOLUTION OF THE CITY COUNCIL OF THE CITY OF NATIONAL CITY ESTABLISHING THE PROPERTY TAX RATE FOR BONDED INDEBTEDNESS FOR FISCAL YEAR 2005-06 PREPARED BY Bill Yeomans /" DEPARTMENT Finance x 4331 Interim Financ Director EXPLANATION To pay the General Obligation Bond debt service for Fiscal Year 2005-06, a property tax rate must be set. The attached calculation results in a property tax rate of .01770 per $100 of assessed valuation. This is a reduction of 11% from the 2004-05 rate of .0200. J ( Environmental Review N/A Financial Statement N/A STAFF RECOMMENDATION Approve and file. BOARD / COMMISSION RECOMMENDATION N/A ATTACHMENTS ( Listed Below Approved By: jf/ . Finance ]rector 1. Resolution 2. General Obligation Bond Tax Rate Computation FY 2005-06 A 200 (9:99) Account No. Resolution No. RESOLUTION NO. 2005 — 185 RESOLUTION OF THE CITY COUNCIL OF THE CITY OF NATIONAL CITY ESTABLISHING THE PROPERTY TAX RATE FOR BONDED INDEBTEDNESS FOR FISCAL YEAR 2005/06 WHEREAS, the total net taxable secured assessed valuation of the City is now estimated at $2,191,693,000 full value; and WHEREAS, the amount of revenue to be raised from the tax base for fiscal year 2005/06 is $397,408, according to the voter approved bonded indebtedness, thereby establishing the rate of property tax required. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of National City that the property tax rate for the City of National City for the fiscal year ending June 30, 2006, be and hereby is established at .01770 per $100 assessed value. 2002 GENERAL OBLIGATION BONDS: $0.01770 PER $100 ASSESSED VALUE PASSED AND ADOPTED this 23rd day of August, 2005. Nick Inzunza, Mayor ATTEST: Michael R. Dalla, City Clerk APPROVED AS TO FORM: George H. Eiser, III City Attorney Attachment 1 Library Bonds Debt Sei ice (Fund 259) 8/4/2005 National City Tax Rate Computation FY2005-06 0.0200 Secured 0.0228 Unsecured HO Exemption FY05-06 Rate Assessed Val. Est. Revenue 0.0177 2,191,692,779 387,930 0.0200 134,539,810 26,908 414,838 30,574,600 6065-50 2,191,692,779 11 Amount to be raised 397,408 5.30% 116,159,717 12 2,075,533,062 14 Unsecured 26,908 0.0200 30,574,600 15 Amount to be raised 2,106,107,662 by secured taxes 370,500 2,106,107,662 18a Tax rate * #4 365,121 2,106,107,662 18b Tax rate * HOPTR 5,379 Maximum Rate 0.0261 19 Secured Proof 370,500 16 Computed Rate 0.0176 20 Raised by 1/100th mil 2,106 17 Plus .0001 0.0177 21,23 Taxes Raised 399,514 I CERTIFY THAT THE ABOVE COMPUTED RATE + 1/100TH MIL IS A REASONABLE TAX RATE FOR THIS FUND A) ' 21:31... 8/4/2005 William Ye ns Date Interim Fin nce Director National City Z;uawq 1efl 1 Net Secured 3 Delinquency @ 4 Net after Delinq 5 Plus HOPTR 6 7 9 10