HomeMy WebLinkAbout2004 CON CDC Olson Urban Housing - DDA 835 Bay Marina Dr.DISPOSITION AND DEVELOPMENT AGREEMENT
By and Between the
COMMUNITY DEVELOPMENT COMMISSION
OF THE CITY OF NATIONAL CITY
and
OLSON URBAN HOUSING, LLC
npirm
TABLE OF CONTENTS
Pace
100. DEFINITIONS 2
200. CONVEYANCE OF THE SITE 6
201. Disposition of Site 6
202. Escrow 6
203. Review of Title 8
204. Title Insurance 9
205. Conditions of Closing 9
206. Representations and Warranties 11
207. Studies and Reports 13
208. Condition of the Site. 13
300. DEVELOPMENT OF THE SITE 15
301. Scope of Development. 15
302. Design Review. 15
303. Land Use Approvals 17
304. Schedule of Performance 17
305. Cost of Construction 17
306. Insurance Requirements 17
307. Rights of Access 18
308. Compliance with Laws 18
309. Release of Construction Covenants 19
310. Financing of the Improvements. 19
400. COVENANTS AND RESTRICTIONS 20
401. Use in Accordance with Redevelopment Plan 20
402. Use Covenants 21
403. Maintenance Covenants and CC&Rs 21
404. Nondiscrimination Covenants 21
405. Effect of Violation of the Terms and Provisions of this Agreement After Completion of
Construction 22
500. DEFAULTS AND REMEDIES 22
501. Default Remedies 23
502. Institution of Legal Actions 23
503. Termination by the Developer Prior to the Conveyance 23
504. Termination by the CDC Prior to the Conveyance 23
505. Reentry and Revesting of Title in the CDC After the Closing and Prior to Completion of
Construction 23
506. Acceptance of Service of Process 25
507. Rights and Remedies Are Cumulative 25
508. Inaction Not a Waiver of Default 25
509. Applicable Law 25
510. Non -Liability of Officials and Employees of' the CDC 26
TABLE OF CONTENTS
(continued)
Page
511. Attorneys' Fees 26
600. GENERAL, PROVISIONS 26
601. Notices, Demands and Communications Between the Parties 26
602. Enforced Delay; Extension of Times of Performance 26
603. Transfers of Interest in Site or Agreement 27
604. Relationship Between CDC and Developer 29
605. CDC Approvals and Actions 29
606. Counterparts 29
607. Integration 29
608. Real Estate Brokerage Commission 29
609. Titles and Captions 30
610. Interpretation 30
611. No Waiver 30
612. Modifications 30
613. Severability 30
614. Computation of Time 30
615. Legal Advice 30
616. Time of Essence 30
617. Cooperation 30
618. Conflicts of Interest 31
619. Time fbr Acceptance of Agreement by CDC 31
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Attachment No. 1 Site Map A-1
Attachment No. 2 Site Legal Description A-2
Attachment No. 3 Grant Deed A-3
Attachment No. 4 Schedule of Performance A-4
Attachment No. 5 Scope of Development A-5
Attachment No. 6 Release of Construction Covenants A-6
Attachment No. 7 CDC Environmental Reports A-7
DISPOSITION AND DEVELOPMENT AGREEMENT
THiS DISPOSITION AND DEVELOPMENT AGREEMENT (this "Agreement") is
entered into as of March 23, 2004, by and between the COMMUNITY DEVELOPMENT
COMMISSION OF NATIONAL CITY, a public body, corporate and politic (the "CDC"), and
OLSON URBAN HOUSING, LLC, a Delaware limited liability company (the "Developer").
RECITALS
The following recitals are a substantive part of this Agreement:
1. In furtherance of the objectives of the California Community Redevelopment Law,
the CDC desires to redevelop a certain approximately 1.26 acre portion of the National City
Redevelopment Project (the "Redevelopment Project") located at 835 Bay Marina Drive, San Diego,
County Assessor Parcel numbers 559-117-04, 05, 06, 07 and 12 (the "Site") in the City of National
City (the "City"). The CDC currently owns the Site, which was previously developed with urban
uses.
2. The CDC and the Developer desire by this Agreement for the Developer to purchase
the Site from the CDC, and for the Developer to construct approximately forty (40) live/work
townhome loft residential units (the "Residential 1 lnits"), and associated on- and off -site
improvements, in two (2) phases, as further described herein (the "Improvements").
3. The Parties have determined that Hazardous Materials, defined below, are present at
the Site.
4. As of the Date of the Agreement, the CDC intends to submit a Property Mitigation
Plan ("PMP") for the Site to the regulatory agencies asserting jurisdiction over the Site. The PMP is
intended to assure the suitability of the Site for the development, occupancy and operation of the
Redevelopment Project and the Remedial Work is to be performed in accordance with applicable
Governmental Requirements and Environmental Laws and in a manner that is intended to qualify for
the immunity under the Polanco Act (set forth at California Health and Safety Code §33459 et seq.).
5. The Parties believe that neither the CDC, nor the Developer, caused the
environmental contamination on the Site. However, completion of the Remedial Work is in the best
interests of the CDC, and National City and the health, safety and welfare of the residents and
taxpayers of the Redevelopment Project and the City, and is in accord with the public purposes and
provisions of applicable state and local laws. The CDC desires to see the Remedial Work completed
under the Polanco Act to effectuate reuse of the Site in accordance with the Redevelopment Plan as
well as to provide the CDC, Developer and any subsequent purchasers of all or a portion of the Site
with immunity pursuant to health and Safety Code §33459.3.
6. The CDC's acquisition of the Site and disposition of the Site to the Developer, and
the Developer's acquisition of the Site and construction and completion of the Improvements
pursuant to the terms of this Agreement, are 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 hereby agree as follows:
100. DEFINITIONS
"Actual Knowledge" is defined in Section 208.1 hereof
"Agreement" means this Disposition and Development Agreement between the CDC and the
Developer.
"Association" means the property owner's association for the Residential tlnits, as set forth
in Section 403 hereof:
"Association CC&Rs" means the Declaration of Covenants, Conditions and Restrictions for
the Residential Units, as set forth in Section 403 hereof.
"Basic Concept Drawings" means the plans and drawings to be submitted by the Developer
and approved by the CDC, as set forth in Section 302.1 hereof.
"CDC" 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 to the benefit
of the CDC, as set forth in Section 205.1 hereof:
"C'DC Environmental Reports" means the environmental reports which have been submitted
by the CDC to the Developer, 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 Site from the CDC to the
Developer, as set forth in Section 202 hereof.
"Closing Date" means the date of the Closing, as set forth in Section 202.4 hereof.
"Completion Letter" means the issuance by the DEH or other applicable governmental
agency of a letter, certificate or other official writing in a form reasonably acceptable to Developer
which provides that the PMP has been completed and that no further investigation, remediation,
response or removal with respect to Hazardous Materials is necessary considering the development,
occupancy and operation of the Project and confirming, without limitation, that the immunity
available under Health and Safety Code Section 33459.3 applies.
"Condition of Title" is defined in Section 203 hereof.
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"Construction Drawings" moans the detailed construction drawings and plans to be prepared
with respect to the Improvements, as set forth in Section 302.3 hereof
"Conveyance" means the conveyance of the Site by the CDC to the Developer on the
Closing Date.
"Date of Agreement" means the date sot 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.
"DEH" means the County of San Diego, Department of Environmental Health.
"Developer"means Olson Urban Housing, LLC, a Delaware limited liability company, and
its successors and assigns.
"Developer's Conditions Precedent" means the conditions precedent to the Closing to the
benefit of the Developer, as set forth in Section 205.2.
"Developer's Environmental Consultant" means the environmental consultant that may be
employed by the Developer pursuant to Section 208.2 hereof.
"Developer's Environmental Report" means the environmental investigation of the Site,
which may be conducted for the Developer by Developer's Environmental Consultant, as set forth in
Section 208.2 hereof.
"Eligible Persons" means any individual, partnership, corporation or association which
qualifies as a "displaced person" pursuant to the definition provided in Government Code
Section 7260(c) of the California Relocation Assistance Act of 1970, as amended, and any other
applicable federal, state, or local regulations or laws.
"Environmental Insurance" is defined in Section 208.5 hereof
"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 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. Ilealth & Safety Code §
25300 et seq.), (xi) the Hazardous Waste Control Act (Cal. Health & Safety Code § 25100 et seq.),
(xii) the Carpenter -Presley -Tanner Ilazardous Substance Account Act (Cal. Health and Safety Code
§ 25316 et seq.), (xiii) the Hazardous Materials Release Response Plans and Inventory (Cal. Health
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& 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 ('ode, 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.
"Environmental Reports" means the collective environmental investigations of the Site as
reported in the Developer's Environmental Report and any investigations conducted by or for the
CDC performed pursuant to Section 208 hereof
"Escrow" is defined in Section 202 hereof.
"Escrow Agent" is defined in Section 202 hereof.
"Escrow Costs" are defined in Section 202.1 hereof.
"Exceptions" is defined in Section 203 hereof.
"Governmental Requirements" means all laws, ordinances, statutes, codes, rules,
regulations, orders and decrees of the United States, the state, the county, the City, or any other
political subdivision in which the Site is located, and of any other political subdivision, CDC or
instrumentality exercising jurisdiction over the CDC, the Developer or the Site.
"Grant Deed" means the grant deed for the conveyance of the Site from the CDC to the
Developer, in the form of Attachment No. 3 hereto which is incorporated herein.
"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, (v) petroleum, (vi) friable asbestos, (vii) polychlorinated
hyphcnyls, (viii) methyl tertiary butyl ether, or (ix) any other substance, whether in the form of a
solid, liquid, gas or any other form whatsoever, which by any Covernmental 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.
"LIRA" shall mean the Health Risk Assessment for the Site prepared by Developer's
Environmental Consultant.
"Lender" is defined in Section 310 hereof
"Improvements" means the new improvements to be constructed by the Developer upon the
Site, all more particularly described in Section 301.1 hereof and in the Scope of Development.
"Mortgage" is defined in Section 310.1 hereof
"Notice" shall mean a notice in the form prescribed by Section 601 hereof.
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hereof.
"Outside Date" shall mean the last date the Closing shall occur, as set forth in Section 202.4
"Phase 1 Report" and "Phase 2 Report" are defined in Section 2082 hereof
"PMP" means the process for mitigation of the Site through the use of a Property Mitigation
Plan that will be developed in coordination with Site Improvement proposals.
"Polanco Act" shall he defined as California IIealth and Safety Code §33459, et seq.
"Purchase Price" means the price to be paid by the Developer to the CDC in consideration
for the Conveyance of fee title to the Site, as set forth in Section 201 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.
"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 310 hereof, in the
form of Attachment No. 6 hereto which is incorporated herein.
"Remedial Work" means all actions necessary to complete the PMP.
"Report" means the preliminary title report, as described in Section 203 hereof
"Residential Units" means the live/work townhome loft residential units to be constructed on
the Site.
"Schedule of Performance" means the Schedule of Performance attached hereto as
Attachment No. 4 and incorporated herein, 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 attached hereto as Attachment
No. 5 and incorporated herein, which 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" means that certain approximately 1.26 acre foot portion of the Redevelopment Project
located at 835 Bay Marina Drive in the City of National City, which has previously been developed
for urban use. The Site is legally described in the Site Legal Description and depicted in the Site
Map.
"Site Legal Description" means the description of the Site, which is attached hereto as
Attachment No. 2 and incorporated herein.
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"Site Map" means the map of the Site, which is attached hereto as Attachment No. 1 and
incorporated herein.
"Site Plan Drawings" means the plans and drawings to be submitted by the Developer and
approved by the CDC, as set forth in Section 302.2 hereof.
"Threshold Amount" is defined in Section 208.2 hereof:
"Title Company" is defined in Section 203 hereof.
"Title Policy" is defined in Section 204 hereof.
"Transfer" is defined in Section 603 hereof.
200. CONVEYANCE OF THE SITE
201. Disposition of Site. The Developer agrees to purchase the Site from the CDC, and
the CDC agrees to sell the Site to the Developer, in accordance with and subject to all of the terms,
covenants, and conditions of this Agreement, for the all-inclusive purchase price of Eight Hundred
Twenty -Six Thousand One Hundred Twenty -Eight Dollars ($826,128) (the "Purchase Price"). The
Purchase Price represents the fair market value of the Site, as determined by an appraisal of the Site.
202. Escrow. Within ten (10) days after the execution of this Agreement by the CDC, the
parties shall open escrow ("Escrow") with the escrow division of Chicago Title Company in its San
Diego County office, or another escrow company mutually satisfactory to both parties (the "Escrow
Agent").
202.1 Costs of Escrow. CDC shall pay the premium for the Title Policy as set forth
in Section 204 hereof and the documentary transfer taxes, it'any, due with respect to the conveyance
of the Site. The Developer and CDC shall each pay one-half of all other usual fees, charges, and costs
that arise from Escrow (the "Escrow Costs").
202.2 Escrow Instructions. This Agreement constitutes the joint escrow
instructions of Developer and CDC, and the Escrow Agent 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 this Escrow in the shortest possible time. Insurance policies for fire or casualty
are not to be transferred, and CDC will cancel its own policies 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 one (1) business day from deposit of the Purchase Price, the funds shall
be deposited into an interest bearing account with such interest accruing to the benefit of the
Developer.
if in the opinion of either party or the Escrow Agent it is necessary or convenient in order to
accomplish the Closing of this transaction, 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. 'l'he parties agree to execute such other and further documents as
may he reasonably necessary, helpful or appropriate to effectuate the provisions of this Agreement.
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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 Section 205 have been satisfied or
waived by the respective parties. Escrow Agent is instructed to release the CDC's escrow closing
statement and the Developer's escrow closing statement to the respective parties.
202.3 Authority of Escrow Agent. Escrow Agent is authorized to, and shall:
(a) Pay and charge Developer and CDC for their respective shares of the
Escrow Costs payable under Section 202.1 of this Agreement, any endorsements to the premium of
the Title Policy thereto as set forth in Section 204, and any amount necessary to place title in the
condition necessary to satisfy Section 203 of this Agreement.
(b) Pay and charge Developer and CDC for their respective shares of any
escrow fees, charges, and costs.
(c) Disburse funds and deliver and record the Grant Deed when both the
Developer's Conditions Precedent and the CDC's Conditions Precedent have been fulfilled or
waived by Developer and CDC.
(d) Do such other actions as necessary, including obtaining the 'l'itle
Policy, to fulfill its obligations under this Agreement.
(e) Within the discretion of Escrow Agent, 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 FiRP'l'A and any similar state act and regulation
promulgated hereunder. CDC agrees to execute a Certificate of Non -Foreign Status by individual
transferor and/or a Certification of Compliance with Real Estate Reporting Requirement of the 1986
Tax Reform Act as may be required by Escrow Agent, on the form to be supplied by Escrow Agent.
(f) Prepare and file with all appropriate governmental or taxing
authorities a uniform settlement statement, closing statement, tax withholding forms including an
IRS 1099-S form, and be responsible for withholding taxes, if any such forms are provided for or
required by law.
202.4 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 205 hereof, but in no event later than September 30, 2004 (the "Outside Date"). The
Outside Date shall be extended on a day -for -day basis for every day completion of actions required
to be undertaken by, the CDC prior to Closing is delayed beyond the deadlines. set forth herein and in
the Schedule of Performance, including without limitation the C'DC's obligations pursuant to Section
303 to obtain a Local Coastal Plan approval, City zone change and City General Plan land use
amendments, and obtain Metropolitan Transportation Development Board quitclaims for all property
rights associated with each of the rail lines located on the Site. The Closing shall occur at a 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.
202.5 Termination. If Escrow is not in condition to close by the Outside Date,
then either party that has filly performed under this Agreement may, in writing, demand the return of
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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 alter Escrow Agent 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 Agent is authorized
to hold all papers and documents until instructed by a court of competent jurisdiction or by mutual
written instructions of the parties. Developer, however, shall have the sole option to withdraw any
money deposited by it with respect to the Closing less Developer's share of costs of Escrow, if any.
Termination of the Escrow shall he without prejudice as to whatever legal rights either party may
have against the other arising from this Agreement. If no demands are made, the Escrow Agent shall
proceed with the Closing as soon as possible.
202.6 Closing Procedure. Escrow Agent shall close Escrow for the Site as
follows:
(a) Record the Grant Deed with instructions for the Recorder of San
Diego County, California to deliver the Grant Deed to Developer;
(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 Filll TA Certificate, if any, to Developer; and
(e) Forward to both Developer and ('DC 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.
203. Review of Title. The CDC shall cause Chicago Title Company, or another title
company mutually agreeable to both parties (the "Title Company"), to deliver to Developer a
standard preliminary consolidated title report (the "Report") with respect to the title to the Site,
together with legible copies of the documents (the "Documents") underlying the exceptions
("Exceptions") set forth in the Report, within sixty (60) days from the date of this Agreement. The
Developer shall have the right to approve or disapprove the Exceptions in its sole and absolute
discretion; provided, however, that the Developer hereby approves the following Exceptions:
(a) The Redevelopment Plan.
(b) The lien of any non -delinquent property taxes and assessments (to be
prorated at close of Escrow).
Developer shall have thirty (30) days from the date of its latest receipt of the Report, the
Documents and the Survey to give written notice to CDC and Escrow l-lolder of Developer's
approval or disapproval of any of such Exceptions. If Developer notifies CDC of its disapproval of
any Exceptions in the Report, CDC shall have the right, but not the obligation, to remove any
disapproved Exceptions within thirty (30) days alter receiving written notice of Developer's
disapproval or provide assurances satisfactory to Developer in Developer's sole and absolute
discretion that such Exception(s) will be removed on or before the Closing. If CDC cannot or does
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not elect to remove any of the disapproved Exceptions within that period, Developer shall have
fifteen (15) days after the expiration of such thirty (30) day period to either give the CDC written
notice that Developer elects to proceed with the purchase of the Site subject to the disapproved
Exceptions or to give the CDC written notice that the Developer elects to terminate this Agreement.
The Exceptions to title approved by Developer as provided herein shall hereinafter he referred to as
the "Condition of Title." Developer shall have the right to approve or disapprove in its sole and
absolute discretion any further Exceptions reported by the "Title Company after Developer has
approved the Condition of Title for the Site (which are not created by Developer). CDC shall not
voluntarily create any new exceptions to title following the date of this Agreement.
204. Title Insurance. Concurrently with recordation of the Grant Deed conveying title to
the Site, there shall be issued to Developer an ALTA policy of title insurance (the "Title Policy"),
together with such endorsements as are reasonably requested by the Developer, issued by the Title
Company insuring that the title to the Site is vested in Developer in the condition required by
Section 203 of this Agreement. The Title Company shall provide the CDC with a copy of the Title
Policy. The Title Policy shall be for the amount of the Purchase Price. The CDC agrees to remove
on or before the Closing any deeds of trust or other monetary liens against the Site. The Escrow
Costs shall include the cost of any surveys necessary to issue an ALTA Title Insurance Policy and
that portion of the premium for the Title Policy equal to the cost of an ALTA Standard Coverage
Owner's Policy of Title Insurance in the amount of the Purchase Price.
205. Conditions of Closing. The Closing is conditioned upon the satisfaction of the
following terms and conditions within the times designated below:
205.1 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 (k), 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) Parcel Map. A Parcel Map created by the Developer, which creates
a separate legal parcel comprised of the Site, shall have been completed and recorded.
(h) 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.
(c) Execution of Documents. The Developer shall have executed any
other documents required hereunder and delivered such documents into Escrow.
(d) 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 201 and 202 hereof.
(e) Design Approvals. The Developer shall have obtained approval by
the CDC and City of the Basic Concept Drawings, Site Plan application drawings and Site Plan
application, as set forth in Section 302 hereof.
(I) Land Use Approvals. The Developer and the CDC shall have
received all land use approvals required pursuant to Section 303 hereof.
(g) Building Plans and Grading Permits. All grading permits required
for the construction of the Improvements shall he available for issuance upon the payment of
applicable fees, posting of required security, and similar items, and all plans necessary for the
issuance of building permits for the improvements shall have been submitted to the City and accepted
as complete.
(h) Insurance. The Developer shall have provided proof of insurance as
required by Section 306 hereof.
(i) Financing. The CDC shall have approved construction and
acquisition financing as provided in Section 310.1 hereof; and such financing shall have closed and
funded or he ready to close and fund upon the Closing.
(j) General Contractor Contract. Developer shall have provided to
CDC a copy of a valid and binding contract between the Developer and Alamitos Building
Corporation or another duly licensed general contractor reasonably acceptable to the CDC for the
construction of the Improvements, certified by the Developer to be a true and correct copy thereof.
(k) Quitclaim of Rail Lines. The Cl)C shall have obtained quitclaims
for all property rights associated with rail lines located on the Site, as provided in Section 303 hereof
205.2 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 (k), inclusive, described below ("Developer's Conditions
Precedent"), which arc 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 he true and correct in all material respects.
(h) Execution of Documents. The CDC shall have executed the Grant
Deed 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 203 hereof.
(d) Title Policy. The Title Company shall, upon payment of Title
Company's regularly scheduled premium, have agreed to provide to the Developer the Title Policy
for the Site upon the Close of Escrow, in accordance with Section 204 hereof
(e) Environmental. The Developer shall have approved the
environmental condition of the Site after the completion of the Remediation Work by CDC and
receipt of the Completion I .ettcr, and Developer shall have obtained the Environmental Insurance as
provided in Section 208.5 hereof
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(f) Parcel Map. A Parcel Map created by the Developer, which creates
a separate legal parcel comprised of the Site, shall have been completed and recorded.
(g) Design Approvals. The Developer shall have obtained approval by
the CDC and City of the Basic Concept Drawings, Site Plan application drawings. Site Plan
application, and Construction Drawings as set forth in Section 302 hereof.
(h) Land Use Approvals. The Developer and the CDC shall have
received all land use approvals required pursuant to Section 303 hereof.
(I) Building and Grading Permits. All grading permits required fur the
construction of the Improvements shall be available for issuance upon the payment of applicable
fees, posting of required security, and similar items, and all plans necessary for the issuance of
building permits for the improvements shall have been submitted to the City and accepted as
complete.
(j) Demolition of the Existing Improvements. The CDC shall have
demolished and cleared from the Site all existing above -ground and subsurface improvements
located on the Site prior to transfer to the Developer.
(k) Quitclaim of Rail Lines. The CDC shall have obtained quitclaims
for all property rights associated with rail lines located on the Site, as provided in Section 303 hereof
206. Representations and Warranties.
206.1 CDC Representations. CDC represents and warrants to Developer as
follows:
(a) Authority. CDC is a public body, corporate and politic, existing
pursuant to the California Community Redevelopment Law (California IIealth 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 CIXhas 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, CL)C's execution,
deliveryand 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.
(d) Litigation. There are no claims, causes of action or other litigation or
proceedings pending or, to the Actual Knowledge of the CDC, threatened with respect to the
ownership, operation or environmental condition of the Site or any part thereof (including disputes
with mortgagees, governmental authorities, utility companies, contractors, adjoining landowners or
suppliers of goods and services).
(e) Violation. To the Actual Knowledge of the CDC, there arc no
violations of any health, safety, pollution, zoning or other laws, ordinances, rules or regulations with
respect to the Site, which have not heretofore been entirely corrected. In the event CDC has Actual
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Knowledge of any such violations, CDC shall (i) immediately provide Developer with copies of all
documents evidencing such violation, and (ii) cure such violation prior to Closing.
(f) No CDC Bankruptcy. CDC is not the subject of a bankruptcy
proceeding.
Until the Closing, CDC shall, upon the change of any fact or condition which would cause
any of the warranties and representations in this Section 206.1 not to be true as of Closing,
immediately give written notice of such changed fact or condition to Developer. Such exception(s)
to a representation shall not be deemed a breach by CDC hereunder, but shall constitute an exception
which Developer shall have a right to approve or disapprove if such exception would have an effect
on the value and/or operation of the Site. If Developer elects to close Escrow following disclosure of
such information, CDC's representations and warranties contained herein shall be deemed to have
been made as of the Closing, subject to such exception(s). If, following the disclosure of such
information, Developer elects to not close Escrow, then this Agreement and the Escrow shall
automatically terminate, and neither party shall have any further rights, obligations or liabilities
hereunder. The representations and warranties set forth in this Section 206.1 shall survive the
Closing.
206.2 Developer's Representations. Developer represents and warrants to CDC as
follows:
(a) Authority. Developer is a limited liability company formed in and in
good standing under the laws of the State of Delaware, 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.
(h) 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)
bankruptcy proceeding.
No Developer Bankruptcy. Developer is not the subject of a
Until the Closing, Developer shall, upon the change of any fact or condition which would
cause any of the warranties and representations in this Section 206.2 not to be true as of Closing,
immediately give written notice of such changed fact or condition to Cl)C. Such exception(s) to a
representation shall not be deemed a breach by Developer hereunder, but shall constitute an
exception which CDC shall have a right to approve or disapprove if such exception would have an
effect on the value and/or operation of the Site. If CDC elects to close Escrow following disclosure
of such information, Developer's representations and warranties contained herein shall be deemed to
have been made as of the Closing, subject to such exception(s). If, following the disclosure of such
information, CI)C' elects to not close Escrow, then this Agreement and the Escrow shall
automatically terminate, and neither party shall have any further rights, obligations or liabilities
hereunder. The representations and warranties set forth in this Section 206.2 shall survive the
Closing.
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207. Studies and Reports. Prior to the Closing, representatives of Developer shall have
the right of access to all portions of the Site for the purpose of obtaining data and making surveys and
tests necessary to carry out this Agreement, including the investigation of the environmental
condition of the Site pursuant to Section 208 hereof Any preliminary work undertaken on the Site
by Developer prior to the Closing shall be done at the sole expense of the Developer, and the
Developer's execution of a right of entry agreement to be provided by the CDC. Any preliminary
work shall be undertaken only after securing any necessary permits from the appropriate
governmental agencies.
208. Condition of the Site.
208.1 Disclosure. Prior to the execution of this Agreement, CDC also has caused
certain investigations of the environmental condition of the Site, and the land adjacent to or near the
Site, as specifically identified in Attachment No. 7 hereof which is incorporated herein (the "CDC
Environmental Reports"). Developer acknowledges that Developer has been provided copies of each
of the CDC Environmental Reports. In addition to this investigation of site conditions, CDC has
applied for and received a Resolution of the Cal -EPA that appointed the County of San Diego,
Department of Environmental Health ("DEH"), as "administering agency" for the Site, as that term is
used in the Uniform Agency Review Law (Health and Safety Code §§ 25260, et seq.) As such, the
DEH will have authority to determine whether investigations are adequate and whether they comply
with state and local laws, ordinances, regulations and standards. Pursuant to this appointment, the
CDC has provided a Master Work Plan to the DEH that encompasses the Site, and which outlines a
process for its mitigation through the use of a Property Mitigation Plan ("PMP") that will be
developed in coordination with Site improvement proposals.
Except as may be set forth in the CDC Environmental Reports, the CDC and the Developer
hereby represent and warrant to the other that they have no actual knowledge, and have not received
any notice or communication from any government agency having jurisdiction over the Site,
notifying such party of the presence of surface or subsurface zone hazardous Materials in, on, or
under the Site, or any portion thereof. "Actual knowledge," as used herein, shall not impose a duty
of investigation, and shall be limited to the actual knowledge of the CDC and Developer employees
and agents who have participated in the preparation of this Agreement and the management of the
Site.
208.2 Investigation of Site. In addition to conducting a physical assessment of the
Site, Developer shall have the right, at its sole cost and expense, to engage its own environmental
consultant ("Developer's Environmental Consultant") to conduct an environmental assessment and
make such investigations as Developer deems necessary, including any "Phase I" and/or "Phase iI"
investigations of the Site (including soil, vapor, and groundwater sampling and monitoring), and
shall promptly provide CDC a copy of all final reports and test results (not including drafts) provided
by Developer's Environmental Consultant ("Developer's Environmental Reports"). Developer shall
also timely provide proposed plans for the Improvements at the Site, indicating where constniction
excavation is planned, and showing all final grades, paving and other site hardscapc, in order for the
('I)(' to develop and propose, at its sole cost and expense, the PMP satisfactory for the proposed end
use of the Site and the protection of the health of construction workers during the development phase.
('DC will coordinate with the Developer to ensure the suitability of the PMP for the proposed
development.
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208.3 CDC's Performance of Remedial Work The CDC, at its sole cost and
expense, shall be responsible for completing the Remedial Work (and all necessary tasks to obtain
the Completion i,ettcr) in compliance with the PMP and all Governmental Requirements and for
obtaining the Completion Letter prior to the Closing. Developer and Developer's Environmental
Consultant shall have the right to be present and oversee the Remedial Work at their sole cost and
expense. Promptly upon completion of the Remedial Work. CDC shall submit all necessary
documentation to the governmental agency with oversight authority to obtain the Completion Letter.
208.4 CDC Responsibilities for Hazardous Materials and Remedial Work.
CDC shall use its best efforts, at its sole cost and expense, to secure a regulatory approval for the
PMP for the Site, and, to the extent provided by law, will endeavor to secure a determination from
the DEH so that Polanco Act immunities can attach, to the benefit of the Developer. However,
Developer accepts that not all contamination may be removed from the Site following completion of
activities described in the PMP, even after the issuance of the Completion Letter. Developer
understands that although the Site will be prepared to a condition in which impacts have been
mitigated to a level where the Site meets human health risk criteria, and construction -related nuisance
impacts have been abated (or will be abated simultaneously with construction activities), that some
substances may remain at the Site, at or below concentrations consistent with regulatory guidelines
for residential development. As a result of the Polanco Act, the Developer, its lender, successors and
assigns should have certain immunities from liability for future remediation of these substances by
operation of state law. however, should Developer, its successors or assigns determine or desire to
undertake future construction or additional remediation activities at the Site, any increased costs
related to the redevelopment by reason of residual impacts shall be borne by Developer, its successor
and assigns, and the CDC will have no responsibility therefor. In addition, Developer, and its
successors and assigns, accept that the immunities described in the Polanco Act do not shield or
protect against liability as a result of new releases of Hazardous Materials that may occur during or
after the redevelopment process. CDC shall have no responsibility for any such new releases, and
Developer waives and abandons any such claims for liability against the CDC for such new releases.
208.5 Environmental Insurance. Prior to the Closing, the Developer (through its
legal counsel) shall purchase environmental insurance ("Environmental Insurance") providing terms
and coverage mutually agreeable to the Parties and with aggregate limits reasonably acceptable to the
Developer. The CDC shall pay the lesser of Thirty Thousand Dollars (S30,000) or one-half of the
cost of the Environmental Insurance, which shall be payable from the Purchase Price funds paid into
the Escrow for the Conveyance of the Site, and the Developer shall be responsible for any additional
costs thereof."Hie Environmental insurance shall remain in effect for a period of not less than ten
(10) years. Developer shall he listed as the named insured on the policy, and the CDC shall be an
additionally insured party. If the Closing does not occur, CDC shall reimburse Developer for
reasonable and customary expenses (including without limitation any premiums) incurred by the
Developer in relation to the Environmental Insurance.
208.6 Warranties As To Site. "Io the extent authorized by contract or law, the
CDC shall assign to the Developer all warranties and guaranties with respect to the environmental
condition of the Site, if any, that the C'i)C may have received from prior owners of the Site.
208.7 Mutual Representations The Parties recognize that redevelopment of the
Site is dependent upon many factors, one of which is receipt of the immunities upon completion of
the Remedial Work as provided in the Polanco Act. To that end, the Parties hereto agree that each
have and will continue to exercise best efforts to fulfill the obligations and duties required under the
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Polanco Act, including without limitation, providing notices as required, completing the Remedial
Work in accordance with the approved PMP, and requesting closure and the Completion Letter.
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 two phases 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 as set forth herein. The Improvements shall generally consist
of approximately forty (40) live/work town home loft residential units (the "Residential Units")
ranging from 1,000 to 1,800 square feet in size, housed in five (5) individual structures. The ground
floor of each three-plex building will also contain a total of approximately 741 square feet of
retail/office space that can be attached to one (1) Residential Unit, or divided between all three (3)
Residential Units. The CDC shall construct or cause the construction of all public improvements
required as conditions of project approval which are located outside of the face of the curbs
surrounding the Improvements. The Developer shall also construct the curbs and all other on -site
improvements located inside of the face of the curbs surrounding the Improvements, as required
through the City's Design Review process described herein.
302. Design Review.
302.1 Basic Concept Drawings. Within the time set forth in the Schedule of
Performance, the Developer shall submit conceptual drawings for the Improvements, including
materials, color board, elevations of all four sides of the Improvements, preliminary landscape plans,
the traffic and circulation plans, and a rendered perspective (collectively, the "Basic Concept
Drawings"). Within the time set forth in the Schedule of Performance, the CDC shall either approve
the Basic Concept Drawings or set forth the reasons for its disapproval in writing.
302.2 Site Plan Drawings. After the CDC's approval of the Basic Concept
Drawings, and within the time set forth in the Schedule of Performance, the Developer shall submit
to the CDC and City plans and drawings with respect to the Improvements (the "Site Plan
Drawings"), which must include all documents, plans and 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. Within the time set forth in the Schedule of
Performance, the CDC shall either approve the Site Plan Drawings or set forth the reasons for its
disapproval in writing. In the event that the CDC fails to act within the time set forth in the Schedule
of Performance, the Site Plan Drawings shall be deemed to have been approved by the CDC.
302.3 CDC Review and Approval. The CDC shall have the right to review and
approve the Basic Concept Drawings. The CDC shall have the right to review and reasonably
approve or disapprove the Site Plan Drawings; provided, however, that the CDC shall reasonably
approve logical evolutions and/or extensions of drawings that it has previously approved. The (.'DC
may review any and all aspects of the Basic Concept Drawings and Site Plan Drawings. The
Developer acknowledges and agrees that the CDC is entitled to approve or disapprove the Basic
Concept Drawings and Site Plan Drawings in order to satisfy the CDC's obligation to promote the
sound development and redevelopment of land within the Redevelopment Project, to promote a high
level of design which will impact the surrounding development, and to provide an environment for
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the social, economic and psychological growth and well-being of the citizens of the City and the
Redevelopment Project.
302.4 Standards for Disapproval. The CDC shall have the right to disapprove the
Basic Concept Drawings in its reasonable discretion. The ('I)(' shall have the right to disapprove in
its reasonable discretion any of the Site Plan Drawings if (a) the Site Plan Drawings do not conform
to the approved Basic Concept Drawings, or (b) the Site Plan Drawings do not conform to the Scope
of Development or this Agreement, or (c) the Site Plan Drawings are incomplete; provided, however,
that the CDC shall reasonably approve logical evolutions and/or extensions of drawings which it has
previously approved. The CDC shall state in writing the reasons for disapproval within fifteen (15)
days of such disapproval as stated herein, and in the event that the CDC fails to do so, the drawings
shall be deemed approved. The Developer, upon receipt of a disapproval based upon powers
reserved by the CDC hereunder, shall revise such portions and resubmit to the CDC by the time
established therefor in the Schedule of Performance.
302.5 Consultation and Coordination. During the preparation of the Basic
Concept Drawings, Site Plan Drawings and Construction Drawings, staff of the CDC and the
Developer shall hold regular progress meetings to coordinate the preparation of, submission to, and
review of the Basic Concept Drawings, Site Plan Drawings and Construction Drawings by the CDC.
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 to serve as the project manager who is
responsible for the coordination of the Cl)C's activities under this Agreement and for expediting the
land use approval and permitting process.
302.6 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. At the sole discretion of the CDC, if any material change in the basic uses
of the Site is proposed in the Basic Concept Drawings, Site Plan Drawings or Construction Drawings
from the basic uses of the Site as provided for in this Agreement, then this Agreement is subject to
re -negotiation of all terms and conditions, including without limitation, the economic terms of the
Agreement. If the Basic Concept Drawings, Site Plan Drawings or Construction Drawings, as
modified by the proposed change, generally and substantially conform to the requirements of this
Section 302 of this Agreement and the Scope of Development, the CDC Director shall review the
proposed change and notify the Developer in writing within fifteen (15) days after submission to the
CDC as to whether the proposed change is approved or disapproved. In the event that the CDC fails
to act within the fifteen (15) day time period set forth above, the proposed change or changes shall be
deemed approved by the CDC. 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 he included by the Developer in its Basic Concept Drawings, Site Plan
Drawings and Construction Drawings and completed during the construction of the Improvements.
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302.7 Defects in Plans. The CI)C 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, nor for any structural or other defects in any work done according to
the approved Basic Concept Drawings, Site Plan Drawings or Construction Drawings, 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, except for obtaining a Local Coastal Plan approval, City zone change and City
General Plan land use amendments, and obtaining Metropolitan Transportation Development Board
quitclaims for all property rights associated with each of the rail lines located on the Site. Obtaining
those approvals and quitclaims shall be the responsibility of the CDC, who will apply for and process
such approvals in accordance with the time period set for in the Schedule of Performance. The
Developer shall, without limitation, apply for and secure the following, and pay all costs, charges and
fees associated therewith:
(a) Site Plan
(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.
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. The Developer shall submit all Basic Concept Drawings,
Site Plan Drawings and Construction Drawings, commence and complete construction of all of the
Improvements, and satisfy all other obligations and conditions of this Agreement, within the times
established in the Schedule of Performance.
305. Cost of Construction. Except to the extent otherwise expressly set forth in this
Agreement, specifically including CDC's obligation to construct certain public improvements at
CDC's expense as set forth in Section 301 hereof and the Scope of Development, all of the cost of
planning, designing, developing and constructing all of the Improvements, site preparation and
grading shall be borne solely by the Developer.
306. Insurance Requirements. The Developer shall take out and maintain or shall cause
its contractor, tenant, or another third party to take out and maintain until the issuance of the Release
of Construction Covenants pursuant to Section 310 of this Agreement, a comprehensive general
liability policy in the amount of One Million Dollars ($1,000,000.00) 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+" 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
17
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 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 310 of this Agreement), for purposes of assuring compliance with this
Agreement, representatives of the Cl)(' shall have the right of 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 308.
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 1324h, 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 herealler be amended.
308.2 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
18
estate taxes and assessments on the Site, subject to the Developer's right to contest in good faith any
such taxes. The Developer agrees that during all times that the CDC is permitted to receive property
tax increment from the Redevelopment Project pursuant to Health and Safety Code Section 33670 (as
it may be amended or substituted).
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 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 fifteen (15) 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. As required herein and as a CDC Condition
Precedent to the Closing, Developer shall submit to CDC evidence that Developer 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, CI)C 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. (71)C 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.
Such evidence of financing shall include the following: (a) a copy of letter of interest(s)
obtained by Developer from one or more financial institutions for the mortgage loan or loans for
financing to fund the construction and completion of the Improvements, subject to such lenders'
reasonable, customary and normal conditions and terms, and/or (b) evidence that Developer has
sufficient funds for such construction, and that such funds have been committed to such construction,
and/or other documentation satisfactory to the CDC as evidence of other sources of capital sufficient
to demonstrate that Developer has adequate funds to cover the difference between the total cost of
the construction and completion of the Improvements, less financing authorized by those loans set
forth in subparagraph (a) above.
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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 fix financing
the constriction 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 Ilolder 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 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 ('DC 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 sixty (60) 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 improvement 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 sixty (60) 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') it'and to the extent any such holder has within such sixty (60) 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.
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 the Redevelopment Plan and 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 the Redevelopment Plan and all applicable
provisions of the City Municipal Code. The foregoing covenants shall run with the land.
20
402. Use Covenants. For a term commencing upon the Conveyance and ending upon the
expiration of the effectiveness of the current Redevelopment Plan, excluding any extensions of the
Redevelopment Plan, the Developer hereby covenants and agrees for itself, its successors, its assigns
and all voluntary and involuntary successors in interest to the Site, or any part thereof, that the Site
will only be used for residential housing purposes.
403. Maintenance Covenants and CC&Rs. The Developer shall maintain the Site and
all improvements thereon, including all landscaping, in compliance with the terms of the
Redevelopment Plan and with all applicable provisions of the National City Municipal Code, during
the period of the Developer's ownership of the Site or portions thereof. The Developer shall prepare
and submit to the CDC's legal counsel for its reasonable approval a Declaration of Covenants,
Conditions and Restrictions for the Residential Units (the "Association CC&Rs"), which establishes
a property owners' association for the Residential l Jnits (the "Association"). The Association
CC&Rs shall require the owners of all Residential Units constructed on the Site to he members of the
Association. The Association CC&Rs shall entitle each owner to use of the common areas and
facilities to be constructed on the Site and shall set forth an equitable apportionment of the costs of
maintaining and operating such common areas and facilities. The Association C'C&Rs shall require
the maintenance of the improvements and the Site in accordance with the standards of this Section
403 and the standards of similar residential developments within the City. The Association CC&Rs
shall be enforceable by the CDC, and any substantive amendments to such Association CC&Rs shall
require the consent of the CDC, which consent shall not unreasonably he withheld. The Association
CC&Rs shall he recorded against those portions of the Site which shall contain Residential Units
before the sale of any Residential Units. The Association CC&Rs shall specifically state that the
CDC is an intended third party beneficiary of the Association CC&Rs with the ability to enforce all
the obligations set forth therein, including, without limitation, the ability to cause any and all
maintenance and repair obligations to be performed.
404. Nondiscrimination Covenants. The Developer covenants by and 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 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.
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, including the CC&Rs, 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,
21
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 vendces 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,
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.
500. DEFAULTS AND REMEDIES
22
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 oi: Except 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 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 he instituted in the Superior Court of the County of San Diego, State
of California, in an appropriate municipal court in that county, or in the District of the United States
District Court in which such county is located.
503. Termination by the Developer Prior to the Conveyance. In the event that prior to
the Conveyance the Developer is not in default under this Agreement and (a) the CDC does not
tender title to the Site pursuant to the Grant Deed in the manner and condition and by the date
provided in this Agreement, or (b) one or more of the Developer's Conditions Precedent to the
Closing is not fulfilled on or before the time set forth in the Schedule of Performance and such
failure is not caused by the Developer, or (c) any default of the CDC prior to the Closing is not cured
within the time set forth in Section 501 hereof, after written demand by the Developer; or (d) the
Developer timely disapproves the environmental condition of the Site pursuant to Section 208 hereof,
then this Agreement may, at the option of the Developer, he terminated by written Notice thereof to
the ('D(' (the "Notice of Termination"). From the date of the written Notice of Termination of this
Agreement by the Developer to the CDC and thereafter this Agreement shall be deemed terminated
and there shall be no further rights or obligations between the parties with respect to the Site by
virtue of or with respect to this Agreement.
504. Termination by the CDC Prior to the Conveyance. in the event that prior to the
Conveyance the CDC is not in Default under this Agreement and (a) the Developer (or any successor
in interest) assigns or attempts to assign the Agreement or any rights therein or in the Site in violation
of this Agreement; or (b) one or more of the CDC"s Conditions Precedent to the Closing is not
fulfilled on or before the time set forth in the Schedule of Performance and such failure is not caused
by the CDC or City; or (c) the Developer is otherwise in default of this Agreement and fails to cure
such default within the time set torth in Section 501 hereof; then this Agreement and any rights of the
Developer or any assignee or transferee with respect to or arising out of the Agreement or the Site,
shall, at the option of the CDC, he terminated by the CDC by written Notice thereof to the
Developer. From the date of the written Notice of Termination of this Agreement by the CDC to the
Developer and thereafter this Agreement shall he deemed terminated and there shall be no further
rights or obligations between the parties.
505. Reentry and Revesting of Title in the CDC After the Closing and Prior to
Completion of Construction. 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
23
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 ninety
(90) 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 sixty (60) 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 thirty (30) 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 this Agreement;
Any rights or interests provided in this Agreement for the protection
of the holders of such mortgages or deeds of trust; or
3. Any rights or interests held by a lessee in and to the property.
Notwithstanding the above, however, the CDC shall have no right to retake possession of
Residential Units and portions of the Site sold to individual homebuyers in the ordinary course of
business. The (irant Deed shall contain appropriate reference and provision to give effect to the
CDC's right as set forth in this Section 505, 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 505, 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 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
24
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 ('DC. 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 505 are not intended to be exclusive of any other
right, power or remedy, hut 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.
506. Acceptance of Service of Process. In the event that the Developer commences legal
action against the CDC, service of process on the CDC shall he 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 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.
507. 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.
508. 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.
509. Applicable Law. The laws of -the State of California shall govern the interpretation
and enforcement of this Agreement.
25
510. 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 I)ethult or breach by the CD(' (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.
511. Attorneys' Fees. In any action between the parties to interpret, enforce, reform,
modify, rescind, or othenvise in connection with any of the terms or provisions of this Agreement,
the prevailing party in the action shall he 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 H. 12th Street, Suite B
National City, CA 91950-3312
Attention: Executive Director
To Developer: Olson Urban Ilousing, LLC
9191 Towne Centre Drive, Suite L-101
San Diego, CA 92122
Attention: Tony Pauker
Copies to:
Olson Urban I lousing, 1,1,C
3020 Old Ranch Parkway, Suite 400
Seal Beach, California 90740-2750
Attention: Todd Olson
Stradling Yocca Carlson & Rauth
660 Newport Center Drive, Suite 1600
Newport Beach, California. 92660
Attention: Jon Goetz
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 he 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
26
claiming an extension of time to perform, which may include the following: war; acts of 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).
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.
603. Transfers of Interest in Site or Agreement. The qualifications and identity of the
Developer as the developer of high quality residential development 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 310 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
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 shall not be required in connection with any
of the following:
27
(a) Any transfer to a limited liability company, partnership, corporation,
or other entity or entities in which Olson Urban Housing, LLC: and/or The Olson Company 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 311 herein), including the
grant of a deed of trust to secure the finds necessary for construction of the Improvements.
(d) Any conveyance of completed Residential Units to individual
homebuyers in the ordinary course of business.
(e) Any leaseback to Developer of model Residential Units for the period
of the marketing of the Residential Units.
(f) 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 thirty (30) 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 of all of the
obligations of this Agreement. Such assignment shall release the assigning Developer from any
obligations to the Commission 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. 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 developer of residential
developments, (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 killer 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
28
Developer shall promptly furnish to the CDC such further information as may he reasonably
requested.
603.3 Successors and Assigns. 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 ('DC may assigns 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 ('DC shall maintain authority of this Agreement
and the authority to implement this Agreement through the CDC Director (or his duly authorized
representative). The CDC 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.
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 parry'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. 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 lee in
connection with the Developer's acquisition of the Site from the CDC. The parties agree 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.
29
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 he 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 he 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 he done under this
Agreement is computed by excluding the first day (such as the day escrow opens), and including 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 he 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, 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.
30
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 personal interests or the interests of any corporation, partnership or
association in which he 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.
IN WITNESS WHEREOF, the CDC and the Developer have executed this
Disposition and Development Agreement as of the date set forth above.
ATT T:
Benjamin Martinez, CDt. Secretary
CDC:
COMMUNITY DEVELOPMENT
COMMISSION OF THE OF TIIE CITY
OF NATIONAL CITY, a public body,
corporate and politic
By:
,IGINJAL
31
APPROVED AS TO FORM:
CDC Counsel
DEVELOPER:
OLSON URBAN HOUSING, I,LC, a
Delaware limited liability company
By: The Olson Company, a California
corporation, its Managing Member
32
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Attachment No. 1-1
ATTACIIMENT NO. 2
SITE LEGAL DESCRIPTION
PARCEL 1:
LOTS 1, 2 AND 3 IN BLOCK 280 OF NATIONAL CITY, IN THE CITY OF NATIONAL CITY, COUNTY OF
SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO MAP THEREOF NO. 348, FILED IN THE
OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY, OCTOBER 2, 1882; EXCEPTING
THEREFROM THE SOUTHERLY 2 FEET OF LOT 3.
APN: 559-117-06
PARCEL 2:
LOTS 4 THRU 10 INCLUSIVE OF THE SOUTHERLY 2 FEET OF LOT 3 IN BLOCK 280 OF NATIONAL
CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO MAP THEREOF NO. 348,
FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY, OCTOBER 2, 1882.
APN: 559-117-07
PARCEL 3:
LOTS 13 TO 16 INCLUSIVE IN BLOCK 280 OF CITY OF NATIONAL, IN THE COUNTY OF SAN DIEGO,
STATE OF CALIFORNIA, ACCORDING TO MAP THEREOF NO. 348, FILED IN THE OFFICE OF THE
COUNTY RECORDER'S OFFICE OF OCTOBER 2, 1882.
TOGETHER WITH THE NORTHERLY 0.30 FEET OF 24TH STREET VACATED AND CLOSED TO
PUBLIC USE ADJOINING SAID LOT 13 ON THE SOUTH.
APN: 559-117-12
PARCEL 4:
LOT 17 IN BLOCK 280 OF CITY OF NATIONAL, IN THE COUNTY OF SAN DIEGO, STATE OF
CALIFORNIA, ACCORDING TO MAP THEREOF NO. 348, FILED IN THE OFFICE OF THE COUNTY
RECORDER'S OFFICE OF OCTOBER 2, 1882.
APN: 559-117-04
PARCEL 5:
LOTS 18 TO 22, INCLUSIVE, IN BLOCK 280 OF CITY OF NATIONAL, IN THE COUNTY OF SAN
DIEGO, STATE OF CALIFORNIA, ACCORDING TO MAP THEREOF NO. 348, FILED IN THE OFFICE
OF THE COUNTY RECORDER'S OFFICE OF OCTOBER 2, 1882.
APN: 559-117-05
Attachment No 2
ATTACILVIENT NO.3
RECORDING REQUESTED BY, MAIL )
TAX STATEMENTS TO AND WIIEN )
RECORDED MAiL TO: )
)
)
)
This document is exempt from payment of a
recording fcc pursuant to Government Code
Section 27383
GRANT DEEI)
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 March 23, 2004, hereby grants to OLSON URBAN
HOUSING, LLC, a Delaware limited liability company ("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 ally 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 March 23, 2004 (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 Di)A
generally requires the Developer to construct a mixed -use residential, retail and/or office
development comprised of approximately forty (40) units 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.
3. Restrictions on Transfer. The Developer further agrees as follows:
Attachment No. 3-1
(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 assigms, 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,
Attachment No. 3-2
or ancestry in the leasing, subleasing, transferring, use,
occupancy, tenure, or enjoyment of the premises herein leased
nor shall the lessee himself or herscl tl 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. 'l'he CDC has the right, at its election, to reenter and take
possession of the Site, with all improvements thereon, and terminate and revert 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 ninety (90) 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 sixty (60) 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 ('DC
or rescinded within thirty (30) days of notice thereof from CDC to Developer.
Such right to reenter, terminate and revert 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 in and to the property.
Notwithstanding the above, however, the CDC shall have no right to retake possession of
Residential Units and portions of the Site sold to individual homebuyers in the ordinary course of
business. Upon the revesting in the CDC of title to the Site as provided in this Section 5, the ('DC
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
Attachment No. 3-3
the Improvements, or such improvements in their stead as shall be satisfactory to the CI)C 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 ot'tnist
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 (hut 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.
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 ('I)C, 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
Attachment No. 3-4
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 he 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 Cl)(' or entity (other than the acts or
failures to act of the CDC which shall not excuse performance by the ('1)(7). 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 (7I)(' 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.
CDC:
COMMUNITY DEVELOPMENT COMMISSION'
OF THE OF THE CITY OF NATIONAL CITY, a
public body, corporate and politic
By:
Nick Inzunza, (.'hairman
Attachment No. 3-5
ATTEST:
Ben Martinez, CDC Secretary
APPROVED AS TO FORM:
CI)C Counsel
OLSON URBAN HOUSING, LLC, a
Delaware limited liability company
By: The Olson Company, a California
corporation, its Managing Member
By: _
Its:
By:
Its:
Attachment No. 3-6
EXIIIBIT "A"
LH;GA1, DESCRIPTION OF SITE
PARCEL 1:
LOTS 1, 2 AND 3 IN BLOCK 280 OF NATIONAL CITY, IN THE CITY OF NATIONAL CITY, COUNTY OF
SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO MAP THEREOF NO. 348, FILED IN THE
OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY, OCTOBER 2, 1882; EXCEPTING
THEREFROM THE SOUTHERLY 2 FEET OF LOT 3.
APN: 559-117-06
PARCEL 2:
LOTS 4 THRU 10 INCLUSIVE OF THE SOUTHERLY 2 FEET OF LOT 3 IN BLOCK 280 OF NATIONAL
CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO MAP THEREOF NO. 348,
FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY, OCTOBER 2, 1882.
APN: 559-117-07
PARCEL 3:
LOTS 13 TO 16 INCLUSIVE IN BLOCK 280 OF CITY OF NATIONAL, IN THE COUNTY OF SAN DIEGO,
STATE OF CALIFORNIA, ACCORDING TO MAP THEREOF NO. 348, FILED IN THE OFFICE OF THE
COUNTY RECORDER'S OFFICE OF OCTOBER 2, 1882.
TOGETHER WITH THE NORTHERLY 0.30 FEET OF 24TH STREET VACATED AND CLOSED TO
PUBLIC USE ADJOINING SAID LOT 13 ON THE SOUTH.
APN: 559-117-12
PARCEL 4:
LOT 17 IN BLOCK 280 OF CITY OF NATIONAL, IN THE COUNTY OF SAN DIEGO, STATE OF
CALIFORNIA, ACCORDING TO MAP THEREOF NO. 348, FILED IN THE OFFICE OF THE COUNTY
RECORDER'S OFFICE OF OCTOBER 2, 1882.
APN: 559-117-04
PARCEL 5:
LOTS 18 TO 22, INCLUSIVE, IN BLOCK 280 OF CITY OF NATIONAL, IN THE COUNTY OF SAN
DIEGO, STATE OF CALIFORNIA, ACCORDING TO MAP THEREOF NO. 348, FILED IN THE OFFICE
OF THE COUNTY RECORDER'S OFFICE OF OCTOBER 2, 1882.
APN: 559-117-05
Exhibit A-1
ATTACHMENT NO.4
SCHEII
LE OF' PERFORMANCE
Local Coastal Program Amendment by City
Environmental Remediation. CDC' to perform
environmental rcmediation of Site for Sand
Diego County Standards and secure closure
letter.
3. Submission of Site Plan and Other Entitlement
Applications for the Project. The Developer
shall prepare and submit to the City and CDC a
complete Site Plan application and other
entitlements necessary for the development and
operation of the Improvements on the Site.
4. CDC review of Site Plan Application and
Approval or Disapproval Thereof The CDC
shall cause the Planning Commission (or
applicable governmental entity) to consider and
take action to approve or disapprove the Site
Plan application, Site Plan Drawings, and other
entitlement applications.
5. Planning Commission Hearing
6. Planning Commission Approval
7. City Council Approval
8. Submission of Site Construction Drawings.
Developer shall submit to the
Building Engineering Department complete
Site Improvement and Construction Drawings.
9. Building/Engineering Review of Complete Site
Improvement and Construction Drawings. The
Attachment No. 4-1
Not later than one hundred twenty
(120) days of signing of DDA
Prior to close of escrow
Within sixty (60) days of'signing of
DDA
Within thirty (30) days of submission
of Site Plan application.
Within thirty (30) days of acceptance
of Site Plan application.
Within thirty (30) days of Planning
Commission Hearing
Within thirty (30) days of Planning
Commission approval.
Within sixty (60) days after approval
of Site Plan by the Planning
Commission and/or City Council.
Within thirty (30) days of
submission.
Building/Engineering Department shall
approve or disapprove the complete Site
Improvement and Construction Drawings and
Street Improvement Plans (collectively
"Construction Drawings".)
10. Revisions of Site Improvement Construction
Drawings by the Developer. Developer shall
prepare revised Construction Drawings as
necessary, and resubmit them to the
Building/Engineering Department for review.
11. Final Review of Complete Site Improvement
Construction Drawings. The
Building/Engineering Department shall
approve or disapprove the revisions submitted
by Developer provided that the revisions
necessary to accommodate the Department's
comments have been made.
12. Submission of Building Construction
Drawings. Developer shall submit to the
Building/Engineering Department complete
Building Construction Drawings.
13. Building/Engineering Review of Complete
Building Construction Drawings. The
Building/Engineering Department shall
approve or disapprove the complete Building
Construction Drawings and Street
Improvement Plans (collectively "Construction
Drawings".)
14. Revisions of Building Construction Drawings
by the Developer. Developer shall prepare
revised Construction Drawings as necessary,
and resubmit them to the Building/Engineering
Department for review.
15. Final Review of Complete Building
Construction Drawings. The
Building/Engineering Department shall
approve or disapprove the revisions submitted
by Developer provided that the revisions
necessary to accommodate the Department's
comments have been made.
Attachment No. 4-2
Within thirty (30) days after receipt
of Building/Engineering's comments.
Within ten (10) days after
submission.
Within sixty (60) days after approval
of Site Plan by the Planning
Commission and/or City Council.
Within thirty (30) days of
submission.
Within thirty (30) days after receipt
of Building/Engineering's comments.
Within ten (10) days after
submission.
16. Opening of Escrow. The CDC shall open an
Escrow with an Escrow Agent.
17. M1'DR Quitclaims. The CDC shall have
obtained quitclaims for all property rights
associated with rail lines located on the Site.
18. Conditions Precedent. Developer and CDC
shall satisfy (or waive) all of their respective
Conditions Precedent to Closing.
19. Close of Escrow for Conveyance. CDC shall
convey the Site to the Developer.
20. Commencement of Constniction. Developer
shall commence construction of the
Improvements to be constructed on the Site.
21. Completion of Construction. Developer shall
complete construction of the Improvements.
77.
Release of Construction Covenants. After the
completion of the construction of the
Improvements the CDC shall record the
Release of Construction Covenants
Attachment No. 4-3
Complete.
Not later than August 1, 2004.
Not later than September 1, 2004.
Not later than September 30, 2004.
Within thirty (30) clays of the
Closing.
Within fourteen months of the
Commencement of construction.
Within fifteen (15) days following
the issuance of occupancy permit.
A'1'TACIIMENT NO. S
SCOPE OF DEVELOPMENT
Developer will develop the Site with approximately 40 live/work townhome units, zoned as
residential dwellings. Units will range from approximately 1,000 square feet to 1,800 square feet in
size. Developer will develop the residential units and all site work (including parks and common
area) within the property boundaries of the Site. The CDC shall construct or cause the construction
of all public improvements required as conditions of project approval, which are located outside of
the face of the curbs surrounding the Improvements. The Developer shall also construct the curbs
and all other on -site improvements located inside of the face of the curbs surrounding the
Improvements, as required through the City's Design Review process described herein.
Attachment No. 5-1
EXIIIBIT 1 TO ATTACHMENT NO.5
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Attachment No. 5-1
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 OLSON URBAN HOUSING, LLC, a
Delaware limited liability company (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 March 23, 2004 concerning the redevelopment of
certain real property situated in the City of National City, California as more filly 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 he 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 he 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.
2. Nothing contained in this instrument shall modify in any other way any other
provisions of the DDA.
Attachment No. 6-1
IN WITNESS WHEREOF, the CDC has executed this Release this day of
200
ATTEST:
Ben Martinez, CDC Secretary
APPROVED AS TO FORM:
CDC Counsel
COMMUNITY DEVELOPMENT COMMISSION
OF TILE OF THE. CITY OF NATIONAL CITY, a
public body, corporate and politic
By:
Nick lnzunza, Chairman
DEVELOPER:
OLSON URBAN HOUSING, LLC, a
Delaware limited liability company
By: The Olson Company, a California
corporation, its Managing Member
By:
Its:
By:
Its:
Attachment No. 6-2
EXHIBIT "A"
SITE DESCRIPTION
PARCEL 1:
LOTS 1, 2 AND 3 IN BLOCK 280 OF NATIONAL CITY, IN THE CITY OF NATIONAL CITY, COUNTY OF
SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO MAP THEREOF NO. 348, FILED IN THE
OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY, OCTOBER 2, 1882; EXCEPTING
THEREFROM THE SOUTHERLY 2 FEET OF LOT 3.
APN: 559-117-06
PARCEL 2:
LOTS 4 THRU 10 INCI USIVE OF THE SOUTHERLY 2 FEET OF LOT 3 IN BLOCK 280 OF NATIONAL
CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO MAP THEREOF NO. 348,
FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY, OCTOBER 2, 1882.
APN: 559-117-07
PARCEL 3:
LOTS 13 TO 16 INCLUSIVE IN BLOCK 280 OF CITY OF NATIONAL, IN THE COUNTY OF SAN DIEGO,
STATE OF CALIFORNIA, ACCORDING TO MAP THEREOF NO. 348, FILED IN THE OFFICE OF THE
COUNTY RECORDER'S OFFICE OF OCTOBER 2, 1882.
TOGETHER WITH THE NORTHERLY 0.30 FEET OF 24TH STREET VACATED AND CLOSED TO
PUBLIC USE ADJOINING SAID LO r 13 ON THE SOUTH.
APN: 559-117-12
PARCEL 4:
LOT 17 IN BLOCK 280 OF CITY OF NATIONAL, IN THE COUNTY OF SAN DIEGO, STATE OF
CALIFORNIA, ACCORDING TO MAP THEREOF NO. 348, FILED IN THE OFFICE OF THE COUNTY
RECORDER'S OFFICE OF OCTOBER 2, 1882.
APN: 559-117-04
PARCEL 5:
LOTS 18 TO 22, INCLUSIVE, IN BLOCK 280 OF CITY OF NATIONAL, IN THE COUNTY OF SAN
DIEGO, STATE OF CALIFORNIA, ACCORDING TO MAP THEREOF NO. 348, FILED IN THE OFFICE
OF THE COUNTY RECORDER'S OFFICE OF OCTOBER 2, 1882.
APN: 559-117-05
Exhibit A
ATTACHMENT NO. 7
CDC ENVIRONMENTAL REPORTS
CDC Environmental Reports shall mean the reports listed herein, copies of which have been
provided to Developer, and the originals of which are on file at the office of the Community
Development Commission of the City of National City:
1. Master Work Plan, CDC Harbor District, Redevelopment Project Environmental
Remcdiation. Environmental Business Solutions September 4, 2001.
2. Letter Regarding Review of Environmental IIazardous Materials Management
Division File for 835-839 West 24th Street, National City, CA. Environmental
Business Solutions. Febmary 22, 2001.
3. Phase II Environmental Assessment on 835 W. 24th Street, National City, CA.
Leighton and Associates 1995.
Harbor District Specific Area Plan, 24th Street Widening and Harrison Avenue
Extension, Supplemental Environmental Impact Report. March 1999 by RECON.
5. IIarbor District Specific Area Plan'l'echnical Studies, City of National City.
Attachment No. 7-1