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HomeMy WebLinkAboutD-3 - EFPAR Development, LLC ENA, 975 W. FoothillSCHEDULED ITEM D-3 TO: HONORABLE CHAIRMAN AND MEMBERS OF THE SUCCESSOR AGENCY BOARD TO THE FORMER REDEVELOPMENT AGENCY OF THE CITY OF AZUSA FROM: TROY L. BUTZLAFF, ICMA-CM, CITY MANAGER FROM: KURT CHRISTIANSEN, FAICP, ECONOMIC & COMMUNUTY DEVELOPMENT DIRECTOR DATE: MAY 16, 2016 SUBJECT: CONSIDERATION OF AN EXCLUSIVE NEGOTIATING AGREEMENT WITH EFPAR DEVELOPMENT, LLC., FOR DEVELOPMENT OF AN URGENT CARE/MEDICAL OR COMMERCIAL RETAIL CENTER AT 975 W. FOOTHILL BOULEVARD. SUMMARY: The City and the Successor Agency to the former Redevelopment Agency are owners of several parcels located at 975 W. Foothill Boulevard. Last year, the City retained CBRE to market the parcels for development. The City received development proposals from several developers on the property. After reviewing the proposals and evaluating the proposed development concepts for the site, Staff is recommending that the City Council consider entering into an Exclusive Negotiating Agreement (“ENA”) with EFPAR Development, LLC., to allow the parties to establish the negotiating parameters, terms and conditions for the development of urgent care/medical uses or commercial retail center on the property. This action approves an ENA with EFPAR Development, LLC ., for a period of one hundred and eighty days (180) days with the ability to extend the term, administratively, for two additional ninety (90) day periods if needed. RECOMMENDATION: Staff recommends that the City Council take the following actions: 1)Approve an Exclusive Negotiating Agreement (“ENA”) with EFPAR Development, LLC., which allows for a period of exclusive negotiations between the City and EFPAR Development for the purpose of preparing major elements of the proposed development including, but not limited to: a site plan; design schematics; technical and economic studies; and, the pre- development obligations of all parties; and 2)Authorize the Mayor to execute the ENA, in a form acceptable to the City Attorney, on behalf of the City. CONTINUED Consideration of an ENA with EFPAR Development May 16, 2016 Page 2 DISCUSSION: The City and the Successor Agency to the former Redevelopment Agency are owners of several parcels located at 975 W. Foothill Blvd. There are two (2) parcels in total, owned by the Successor Agency. The total area of the two (2) parcels is 68,111 square feet. Last year, the City hired CBRE to market the parcels for development. The City received development proposals from two different developers on the property. After reviewing both proposals and evaluating the proposed development concepts for the site, Staff is recommending that the City Council consider entering into an Exclusive Negotiating Agreement (“ENA”) with EFPAR Development, LLC., to allow the parties to establish the negotiating parameters, terms and conditions for the development of a 4,000 square foot building to accommodate urgent care/medical uses or commercial retail center on the property. To enable the parties to better define the scope of the project and to negotiate the sale of the parcels, an ENA has been drafted. A copy of the draft ENA is attached. The proposed ENA provides a process for the parties to negotiate a possible disposition and development agreement (DDA) for, among other things, the possible conveyance to and development by EFPAR Development of the proposed project sites. It should be noted that the ENA does not commit the City to such conveyance or development, nor does it commit EFPAR Development to develop the project. The ENA only commits the parties to negotiate in good faith to attempt to reach an agreement over the next 180 days. The ENA can be extended, administratively, for two additional 90 day periods. The general terms of the ENA are as follows: General ENA Terms • EFPAR Development to purchase the parcels for One Million Eighty-five Thousand Dollars ($1,085,000) if the property is developed as an urgent care or medical use (defined as having at least 4,000 square feet for such use) or One Million Two Hundred Eighty-five Thousand ($1,285,000) if the property is developed as a retail/restaurant project with less than 4,000 square feet of medical use (or no medical use). • EFPAR Development to prepare a conceptual development plan for the project that describes and depicts: (1) the location and placement of proposed buildings and (2) the architecture and elevations of the proposed building. • EFPAR Development will be responsible for proposed zoning change or changes to the City’s General Plan, if any, necessary to accommodate the Project on the property. • Terms of any potential Disposition and Development Agreement between the City and EFPAR Development for the development of the project are to be negotiated during the exclusive negotiating period. • EFPAR Development is required to provide a $15,000 deposit which will be used to reimburse the City for certain costs related to the ENA and the evaluation of the development of the project. This deposit is refundable, less costs incurred, to EFPAR Development if the City fails to deliver the project. Consideration of an ENA with EFPAR Development May 16, 2016 Page 3 • The ENA shall terminate for the following reasons: if the agreement expires; in the event of material default by either party; failure to make substantial progress per the proposed schedule set forth in the ENA; failure of the parties to reach agreement on a potential Development Agreement; and if either party is determined to not be negotiating in good faith. Staff believes that it would be appropriate for the City Council to approve the proposed ENA with EFPAR Development in order to provide both parties the necessary time to prepare additional information about the proposed project, including a more detailed site plan, a fiscal impact analysis and financing plan. Ultimately, this information will help determine the viability and economic benefits of the project so the City Council can decide whether to enter into a Disposition and Development Agreement with the developer to develop the project. FISCAL IMPACT: There is no fiscal impact associated with the approval of the ENA. Prepared by: Reviewed and Approved Kurt E. Christiansen, FAICP Louie F. Lacasella Economic and Community Development Director Management Analyst Reviewed and Approved: Troy L. Butzlaff, ICMA-CM City Manager Attachment: 1) Draft ENA THE CITY OF AZUSA EXCLUSIVE NEGOTI ATION AGREEMENT (EFPAR Development/D Club Property) THIS EXCLUSIVE N EGOTIATION AGREEMENT ("Agreement") is dated as of , 2016 , for reference purposes only, and is entered into by a nd between the Successor Agency to the Redevelopment Agency to the City of Azusa, a public body corporate and politic ("City") and EFPAR Development, LLC, a California limited liability company ("Developer"), to provide a specified period of time to negotiate a disposition and development agreement ("ODA"). The C ity and the Developer are sometimes refeITed to in this Agreement individually, as a "Party " and , collectively, as the "Parties." This Agreement is entered into by th e Parties with reference to the following recited facts (each, a "Recital"): RECITALS A. The C ity is the owner of that certain real property located at 975 W Foothill Blvd, Azusa (APN 8605-019-906, 907) and more specifically described in Ex hibit A ("Property"); and B. The City has an interest in developing the Property and accepted development proposals from interested developers; and C. T h e Developer has proposed the r edevelopment of the Property with either an Urgent Care/Medical uses or a commercial retail center, as generally depicted in the conceptual site plans attached to this Agreement as Exhibit "B" and incorporated into this Agreement by this reference ("Project"); and D. The intent of both the City and the Developer in entering into thi s Agreement is to establish a specific, limited period of time to negotiate regarding a future agreement between them governing the potential acquisition of the Property and development of the Project on the Property, all s ubject to mutually agreeable terms, conditions, covenants, restrictions and agreements to be negotiated and documented a future ODA. NOW, THEREFORE, IN VIEW OF THE GOALS AND OBJECTIV ES OF THE CITY R ELATING TO THE SALE AND DEVELOPMENT OF THE PROPERTY AND THE PROMISES OF THE CITY AND THE DEVELOPER SET FORTH IN THIS AGREEMENT, THE CITY AND THE DEVELOPER AGREE, AS FOLLOWS: 1. Incorporation of Recitals. The Recita ls of fact set forth above are true and correct and are incorporated into this Agreement, in their entirety, by this reference. 2. Deposits. (a) Concurrent with the Developer's execution of this Agreement, the Developer shall provide to the City a deposit in the amount of Ten Thousand Dollars ($10 ,000) in immediately available funds ("Initial Deposit") to ensure that the Developer will proceed diligently and in good faith to fulfill its obligations under this Agreement during the Negotiation Period (as defined in Section 3(a)), as part of the consideration for the City's agreement not to negotiate with other persons during th e Negotiation Period, and to defray certain costs of the City in pursuing the contemplated negotiation s with the Developer during the Negotiation Period, pursuant to t hi s Agreement. On th e condition that the Effective Date occurs, the City shall charge all costs (including staff time, consultant fees and attorney 45635 .08005124605 171. l 2 ATTACHMENT 1 fees associated with review and implementation of this Agreement or preparing the DOA) against the Initial Deposit (and Extension Deposit pursuant to Section 2(b) below, as applicable). At the termination of this Agreement, any remaining funds shall, at the Developer's option, either be. app li ed to the purchase price or returned to the Developer. Any funds due to Developer upon termination of this Agreement pursuant to the preceding sentence shall be in addition to any funds Developer may be due pursuant to Section 12 , below. Developer acknowledges that the Initial Deposit (and any Extension Deposit, pursuant to Section 2(b) below) shall be in addition to those fees and expenses required by the City for any permit, other required entitlement or project processing. A portion of the In it ial Deposit in an amount equal to One Hundred Dollars ($100) shall immediately become non-refundable upon Developer's t ransfer of the Initial Deposit to the City under this Agreement as consideration for the City's agreement not to negotiate with other persons during the Negotiation Period. (b) Upon each extension of the Negotiation Period occurring pursuant to the provisions of Section 3(b ), if any, the Developer sha ll provide to the City an additional deposit of Ten Thousand Dollars ($10,000) in immediately avai lable funds on the first day of any extension of the Negotiation Period occurring pursuant to the provision s of Section 3(b) (each, an "Extension Deposit"). Each Extension Deposit is intended to ensure that the Patties will proceed diligent ly and in good faith to fulfill their obli gations under thi s Agreement during any extension of the Negotiation Period , as part of the consideration for the City 's agreement not to negotiate with other persons during any such exten sion of the Negotiation Period, and to defray certain costs of the City in pursuing the contemp lated negotiations with the Developer during any such extension of the Negotiation Period, pursuant to this Agreement. At the termination of this Agreement, any remaining funds from an Extension Deposit shall be refundable to the Developer as provided in Section 2(a), above. 3. Term of Agreement. (a) The rights and duties of the City and the Developer established by this Agreement sha ll commence on the first date on which all of the following have occurred (the "Effecti ve Date"): (1) execution of this Agreement by the authorized representative(s) of the Developer and delivery of such executed Agreement to the C ity, (2) payment of the Initial Deposit to the City by the Developer, in accordance with Section 2(a), (3) ap proval of this Agreement by the C ity governing body and execution of this Agreement b y t he authorized representative(s) of the C ity and ( 4) delivery of such fu ll y executed Agreement to the Developer, the exact date of w hi ch s hall be mutually agreed to by the Parties promptly after Developer's receipt of the fully executed Agreement from the City a s evidenced in writing signed by their respective authorized representatives. The City shall deliver a fully executed counterpart original of this Agreement to the Developer, within te n ( 10) calendar days fo ll owing the City governing body's approval of this Agreement, if approved, and the execution of thi s Agreement by the authorized repre sentativ e(s) of the City. T hi s Agreement s hall continue in effect for the period of one hundred eighty ( 180) consecutive calendar days immediately fo ll owin g the Effective Date ("Negot iation Period "), s ubject to the limitat ions of Sections 3(b). (b) The Negotiation Period may be extended upon the mutual written agreement of the C ity's C ity Manager and the Developer for no more than two (2) additional consecutive ninety (90) calendar day periods. Notwithstanding the immediately preceding sentence or any other part of this Agreement, in no event shal l the Negotiation Period exceed three hundred sixty (360) consecutive calendar days from the Effective Date. ( c) This Agreement shall automatically expire and be of no further force or effect at the end of the Negotiati on Period , unless, prior to that time, both the City and the Developer approve and execute a DDA acceptable to both the City and the Developer, in their re s pective so le and abso lute discretion , in which case this Agreement wi ll term inate on the effective date of such DOA. 4 5635 .0800 5\24605 171.12 4. Obligations of Developer. During the Negotiation Period, the Developer shall proceed diligently and in good faith to develop and present to City staff and , subsequently, to the City governing body, for review, all of the following: (a) A proposed complete conceptual development plan for the Project on the Property that describes and depicts: (1) the location and placement of proposed buildings and (2) the architecture and elevations of the proposed buildings; (b) Proposed zoning change or changes to the City's General Plan, if any, necessary to accommodate the Project on the Property; (c) A list of potential users or tenants and anticipated lease rates for the Property, as develo ped with the Project; ( d) A proposed time schedule and cost estimates for the devel opment of t he Project on the Property; (e) A proposed financing plan identifying financing sources for all private and public improvements proposed for the Project; and (f) A preliminary financial analysis demonstrating the costs and benefits to the City and the City regarding all construction, ma intenance and operations of all proposed public improvements, the costs of additional or increased levels of public serv ices and any new public revenues ant icipated to be generated by the Project. 5. Negotiation ofDDA. (a) During the Negotiation Period, the City and the Developer shall proceed diligently and in good faith to negotiate a DOA between them. The City and the Developer shall generall y cooperate with each other and supply s uch available documents and information as may be reasonably requested by the other to facilitate the conduct of the negotiations. Both the City and the Developer shall exercise commercially r easonable efforts to complete discussions relating to the terms and conditions of a ODA and such other matters, as may be mutually acceptable to both the City and the Developer, in their respective sole discretion. The exact terms and conditions of a DDA, if any, shall be determined during the course of these negotiations. Nothing in this Agreement shall be interpreted or construed to be a representation or agreement by either the City or the Developer that a mutually acceptable DOA will be produced from negotiations under this Agreement. Nothing in thi s Agreement shall impose any obligation on either Party to agree to a definitive DOA in the future. Nothin g in this Agre ement shall be interpreted or construed to be a guaranty, warranty or representation that any propo sed DDA that may be negotiated by City staff and the Developer will be approved by the City governing body. T he Developer acknowledges and agrees that the City's consideration of any DDA is subject to the sole and absolute di screti on of the City governing body and all legally required public hearings, public meetings, notices, factual findings and other determinations required by law. (b) Based upon Developer's proposal the Parties have come to a tentative agreement on the follow ing terms, s ubject to future negotiation during the Negotiation Period: (i) Purchase Price: One Million E ighty-Five T housand Dollars ($1 ,085 ,000) if the Property is developed as an Urgent Care or Medical Use (defined as having at least 4,000 s quare feet for s uch use) or One Million Two Hundred Eighty-Five Thousand Dollars ($1,285 ,000) if the 456 3 5 .0 8005124605171 .12 property is developed as a retail/restaurant project with less than 4,000 sq uare feet of medical use (or no medical use); (ii) Deposit at opening of escrow: Thirty Thousand Dollars ($30,000); (iii) Due Diligence Period: One Hundred Twenty (120) days from effective date of the DOA with an option for One Hundred Twenty (120) day extension . If the Due Diligence Period extension is exercised, Ten Thousand Dollars ($10,0 00) of the Deposit shall become nonrefundable and be immediately paid to City. (iv) Escrow Closing: within Thirty (30) days from the waiver of all contingencies by Deve loper, which election shall be made no later than the expiration of the Due Diligen ce Period. 6. Restrictions Against Change in Ownership, Management and Control of Developer and Assignment of Agreement. (a) The qualifications and ide ntity of the Developer and its principal s (including Keith Parry, an individual) are of particular concern to the City . It is because of these qualifications and identity that the City has entered into this Agreement with the Developer. During the Negotiation Period, no voluntary or involuntary successor-in-interest of the Developer shall acquire any rights or powers under this Agreement, except as provided in Section 6(c). (b) The Developer shall promptly notify the City in writing of any and all changes whatsoever in the identity of the business entities or individuals either comprising or in Control (as defined in Section 6(d)) of the Developer, as well as any and all changes in the interest or the degree of Control of the Developer by any such person , of which information the Developer or any of its shareholders, partners, members, directors, managers or officers are notified or may otherwise have knowledge or information. Upon the occurrence of any significant or material change, whether voluntary or involuntary, in ownership, management or Control of the Developer (other than su ch changes occasioned by the death or incapacity of any individual) that has not been approved by the City, prior to the time of such change, the City may terminate this Agreement, without liability to th'e Developer or any other person and refund any remainin g deposit funds provided by the Developer to the pursuant to Section 2(a), above, by sending written notice of termination to the Developer, referencing this Section 6(b). (c) The Developer may assign it s rights under this Agreement to an Affiliate (as defined in Section 6(d)), on the condition that s uch Affiliate expressly assumes all of the obligations of the Developer under this Agreement in a writing reasonably satisfactory to the City, and further provided that Keith Parry, an individual, shall, at all times, Control any such Affiliate and be re sponsible and obligated directly to the City for performance of the Developer's obligations under this Agreement. (d) For the purposes of this Agreement, the term "Affiliate" means any person , directly or indirectly, controlling or controlled by or under common control with the Developer, whether by direct or indirect ownership of equity interests, by contract, or otherwise. For the purposes of this agreement, "Control" means po ssession, directly or indirectly, of the power to direct or cause the direction of the management and policies of an entity, whether by ownership of equity interests, by contract, or otherwise. 45635 .08005 \2 460 5171 .12 7. Obligations to Review Draft Agreements and Attend Meetings. (a) During the Negotiation Period, each Party shal l diligently review and comment on draft versions of a DDA provided by the other Party and, if the terms and conditions of such a DDA are agreed upon between City staff and the Developer, the Developer shal l submit the DDA fully executed by the authorized representative(s) of the Developer to the City Manager for submission to the City governing body for review a nd approval or disapproval. Any future DDA shall consist of terms and conditions acceptable to both the Developer and the C ity governing body, in their respective sole and absolute discretion. (b) During the Negotiation Period, the Developer shall also keep C ity staff advised on the progress of the Developer in performing its obligations under this Agreement, on a regular basis or as requested by City staff, including, without limitation , having one or more of the Developer's employees or consultants who are knowledgeable regarding this Agreement, the design and planning of the Project and the progress of negotiation of a ODA, s uch that such person(s) can meaningfully respond to City and/or City staff questi ons regarding the progress of the design and planning of the Project or the negotiation of a DOA, attend both: (I) periodic meetings with City staff, as reaso n ably scheduled and requested by C ity staff during the Negotiation Period , and (2) meetings of the City governing body, when reasonably requested to do so by City staff. 8. Developer to Pay All Costs and Expenses. All fees or expenses of e ngineers, architects , financial consultants, legal, planning or othe r consultants or contractors, retained by the Developer for any study, analysis, evaluation, report, schedule, estimate, environmental review, planning and/or design activities, drawings, specifications or other activity or matter relating to the Property or the Project or negotiation of a DOA that may be undertaken by the Developer during the Negotiation Period, pursuant to or in reliance upon this Agreement or in t he Developer's discretion, regarding any matter relating to a DOA, the Property or the Project, shall be the sole responsibility of and undertaken at the sole cost and expense of the Developer and no such activity or matter shall be deemed to be undertaken for the benefit of, at the expense of or in reliance upon the C ity. The Developer shall also pay all fees , charges and costs, make all deposits and provide all bonds or other security associated with the submission to and processing by the City and/or the City of any and all app licati ons and other documents and information to be submitted to the City and/or the City by the Developer pursuant to this Agreement or otherwise associated with the Project. Except as otherwise expressly set fort h in any DDA, the C ity shall not be obl igated to pay or reimburse any expenses, fees, charges or costs incurred by the Developer in pursuit of any study, analysis, evaluation, report, schedule, estimate, environmental review , planning and/or design activities , drawings, specifications or other activity or matter re latin g to the Property or the Project or negotiation of a DOA that may be undertaken by the Developer during the Negotiation Period, whether or n ot this Agreement is , eventually, terminated or extended or a DOA is entered into between the City and the Developer, in the future. 9. City Not To Negotiate With Others. During the Negotiation Period, the C ity and City staff shall not negotiate with any other person regarding the sale or redevelopment of the Property. The term "negotiate," as used in this Agreement, means and refers to engaging in any discussions with a person other than the Developer, regardless of how initiated, with respect to the avai labil ity of the · Property or that person's redevelopment of the Property and presenting any related proposal to the C ity Council for consideration, without the Developer's prior written consent. Developer acknowledges that City may receive and retain unsol icited offers regarding redevelopment of the Property, but shall not entertain any offer or negotiate with the proponent of any such offer during t he Negotiation Period; provided, however, that the City may notify such proponent that it is a party to this Agreement . Developer acknowledges that the City is a public agency and subject to the provisions of the Ca lifornia Public Records Act, Government Code Section 6254, et. seq. (the "Act"). The City shall use its best 45635 .08005\24605171 .12 efforts to inform Developer of any request for information received pursuant to the Act. If Developer believes the information requested is confidential, Developer may pursuant a court order preventing the release of the requested information. I 0. Acknowledgments and Reservations. (a) The City and the Developer agree that, if this Agre1ement expires or is terminated for any reason, or a future DOA is not approved and executed by both the City and the Developer, for any reason, neither the City nor the Developer shall be under any obligation, nor have any liability to each other or any other person regarding the sale or other disposition of the Property or the redevelopment of the Project or the Property; provided, however, that in the event this Agreement terminates for any reason other than t he City breach of this Agreement (which shall be governed by Section 13 , below), the City shall return to the Developer within ten ( 10) business days of such termination any and all deposits due to be refunded pursuant to Section 2(a) of this Agreement. (b) The Developer acknowledges and agrees that no provision of this Agreement shall be deemed to be an offer by the City, nor an acceptance by the City of any offer or proposal from the Developer for the City to convey any estate o r interest in t he Property to the Developer or for the City to provide any financial or other assistance to the Developer for redevelopment of the Project or the Property. (c) The Developer acknowledges and agrees that the Developer has not acquired, nor will acquire, by virtue of the terms of this Agreement, any legal or equitable interest in real or personal property from the City. (d) Certain development standards and design controls for the Project may be established between the Deve loper and the City, but it is understood and agreed between the City and the Developer that the Project and the redevelopment of the Property must conform to all City and other applicable governmental development, land use and architectural r egulations and standards. Drawings, plans and specifications for the Project s ha ll be subject to the approval of the C ity through the standard development application process for projects of this nature. Nothing in this Agreement shall be considered approval of any plans or specifications for the Project or of the Project itself by the City. (e) The City reserves the right to reasonably obtain further available information and data to asce1tain the ability and capacity of the Developer to acquire or lease, develop and operate the Property and/or the Project. The Developer acknowledges that it may be requested to make certain financial disclosures to the City, its staff, legal counsel or other consultants, as part of the financial due diligence investigations of the City relating to the potential s ale of the Property and redevelopment of the Project on the Property by the Developer and that any such disclosures may become public records . The City shall maintain the confidentiality of financia l information of the Developer to the extent allowed by law, as determined by the City Attorney. 11. Nondiscrimination. The Developer shall not discriminate against nor segregate any person, or group of persons on account of race, color, creed, reli gion, sex, marital status, handicap, national origin or ancestry in undertaking its obligations under th is Agreement. 12. Limitation on Damages and Remedies. (a) THE DEVELOPER AND THE CITY ACKNOWLEDGE THAT IT IS EXTREMELY DIFFICULT AND IMPRACTICAL TO ASCERTAIN THE AMOUNT OF DAMAGES THAT WOULD BE SUFFERED BY THE DEVELOPER U PON THE BREACH OF THIS 45635 .08005\2460 5 l 7 l. l 2 AGREEMENT BY THE CITY. HAVING MADE DILIGENT BUT UNSUCCESSFUL ATTEMPTS TO ASCERTAIN THE ACTUAL DAMAGES THE DEVELOPER WOULD SUFFER UPON THE BREACH OF THIS AGREEMENT BY THE CITY, THE DEVELOPER AND THE CITY AGREE THAT A REASONABLE ESTIMATE OF THE DEVELOPER'S DAMAGES IN SUCH EVENT IS TWENTY THOUSAND DOLLARS ($20,000) (THE "LIQUIDATED DAMAGES AMOUNT"). THEREFORE, UPON THE BREACH OF THIS AGREEMENT BY THE CITY, THE CITY SHALL PAY THE LIQUIDATED DAMAG ES AMOUNT TO THE DEVELOPER AND THIS AGREEMENT SHALL TERMINATE. RECEIPT OF THE LIQUIDATED DAMAGES AMOUNT SHALL BE THE DEVELOPER'S SOLE AND EXCLUSIVE REMEDY ARISING FROM ANY BREACH OF THIS AGREEMENT BY THE CITY. Initials of Authorized Representative of City Initials of Authorized Representative of Developer (b) THE C ITY AND THE DEVELOPER EACH ACKNOWLEDGE AND AGREE THAT THE CITY WOULD NOT HAVE ENTERED INTO THIS AGREEMENT, IF IT WERE TO BE LIABLE TO THE DEVELOPER FOR ANY MONETARY DAMAGES, MONETARY RECOVERY OR ANY REMEDY OTHER THAN TERMINATION OF THIS AGREEMENT AND PAYMENT OF THE LIQUID A TED DAMAGES AMOUNT. ACCORDINGLY, THE CITY AND THE DEVELOPER AGREE THAT THE DEVELOPER'S SOLE AND EXCLUS IVE RIGHT AND REMEDY UPON THE BREACH OF THIS AGREEMENT BY THE CITY IS TO TERMINATE THIS AGREEMENT AND RECEIVE THE LIQUIDATED DAMAGES AMOUNT. (c) THE DEVELOPER ACKNOWLEDGES THAT IT IS AWARE OF THE MEANING AND LEGAL EFFECT OF CALIFORNIA CIVIL CODE SECTION 1542 , WHICH PROVIDES: A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEAS E, WHICH IF KNOWN BY HIM OR HER WOULD HA VE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR. (d) CALIFORNIA CIVIL CODE SECTION 1542 NOTWITHSTANDING, IT IS THE INTENTION OF THE DEVELOPER TO BE BOUND BY THE LIMITATION ON DAMAGES, RECOVERY AND REMEDIES SET FORTH IN THIS SECTION 12, AND THE DEVELOPER HEREBY RELEASES ANY AND ALL CLAIMS AGAINST THE CITY FOR MONETARY DAMAGES, MONETARY R ECOVERY OR OTHER LEGAL OR EQUITABLE RELIEF RELATED TO ANY BREACH OF THIS AGREEMENT, EXCEPT RECEIPT OF THE LIQUIDATED DAMAGES AMOUNT, WHETHER OR NOT ANY SUCH RELEASED CLAIMS WERE KNOWN OR UNKNOWN TO THE DEVELOPER AS OF THE EFFECTIVE DATE OF THIS AGREEMENT. THE DEVELOPER SPECIFICALLY WAIVES THE BENEFITS OF CALIFORNIA CIVIL CODE SECTION 1542 AND ALL OTHER STATUTES AND JUDICIAL DECISIONS (WHETHER STA TE OR FEDERAL) OF SIMILAR EFFECT WITH REGARD TO THE LIMITATIONS ON DAMAGES AND REMEDIES AND WAIVERS OF ANY SUCH DAMAGES AND REMEDIES CONTAINED IN THIS SECTION 12. 45635 .08005\24605171.12 Initials of Authorized Representative of City 13. Default. Initials of Authorized Representative of Developer (a) Failure or delay by either Party to perform any material term or provision of this Agreement shall constitute a default under this Agreement. If t he Party who is receives notice of a default from the other Party cures, corrects or remedies the alleged default within fifteen ( 15) calendar days after receipt of written notice by the other Party specifying such default, such Party shall not b e in default under this Agreement. The notice and cure period provided in the immediately preceding sentence shall not, under any circumstances, extend the Negotiation Period . If there are less than fifteen ( 15) days remaining in the Negotiation Period, the cure period allowed pursuant to this Section l 3(a) shall be automatically reduced to the number of d ays remaining in the Negotiation Period. (b) The Party claiming that a default has occurred shall give written notice of default to the Party claimed to be in default, specifyin g the alleged default. Delay in giving such notice shall not constitute a waiver of any default nor shall it change the time of default. However, the injured Party shall have no right to exercise any remedy for a default under this Agreement, without first delivering written notice of the default and allowing the applicable period to cure any such default as set forth in Section 13(a). (c) Any failure or delay by a Party in asserting any of its rights or remedies as to any default shall not operate as a waiver of any defau lt or of any rights or remedies associated with a default. ( d) If a default of either Party remains uncured for more than fifteen (15) calendar days following receipt of written notice of such default, a "breach" of this Agreement by the d efaulting Party shall be deemed to have occurred. Notwithstanding the foregoing, a violation of Section 9 of this Agreement by the City shall be considered a breach without the necessity of any notice or c ure period. In the event of a breach of this Agreement, th e so le and exclusive remedy of the Party who is not in default shall be to terminate this Agreement by serving written notice of termination o n the Party in breach and, in the case of a breach by the City, the Developer shall also be entitled to receive the Liquidated Damages Amount. 14. Compliance with Law. The Developer acknowledges that any future ODA, if approved by the governing body of the City, will require the Developer (among other things) to carry out the development of the Project in conformity with all applicable laws, including all applicable building, planning and zoning laws, environmental laws, safety laws and federal and state labor and wage laws. 15. Press Releases. The Developer agrees to obtain the approval of the City Manager or hi s or her designee or successor in function of any press releases Developer may propose relating to the lease or redevelopment of the Property or negotiation of a ODA with the City, prior to publication . The rights and ob ligations in this provision shall not apply to leasing and marketing brochures and/or information distributed by email or placed online on a brokerage website or real estate website such as LoopNet.com. 16. Notice. All notices required under this Agreement shall be presented in person, by nationally recognized overnight delivery service or by facsimile a nd confirmed by first class certified or registered United States Mail , with return receipt r equested, to the address and/or fax number for the Party set forth in this Section 16. Notice shall be deemed confirmed by United States Mail effective the third (3rd) business day after deposit with the United States Postal Service. Notice by personal service or 45635.08005\24605171 .12 nationally recognized overnight delivery service shall be effective upon delivery. Either Party may change its address for receipt of notices by notifying the other Party in writing. Delivery of notices to courtesy copy recipients shall not be required fo r val id notice to a Party TO DEVELOPER: TO CITY: COPY TO: EFP AR Development, LLC Attn: Keith Parry 8913 W. Olympic Blvd . Beverly Hills, CA 9021 1 T: (3 10) 659-101 1 F: (3 10) 659-1088 The Successor Agency to the Redevelopment Agency of the City of Azusa 213 East Foothill Boulevard Azusa, California 91702 Attention: City Manager T: (626) 812-5238 F: (626) 334-6 358 Best Best & Krieger, LLP 18101 Von Karman Ave, Suite 1000 Irvine, CA 92614 Attention: Marco Martinez T: (949)-263 -2600 F: (949)-260-0972 17. Warranty Against Payment of Consideration for Agreement. The Developer warrants that it has not paid or given, and will not pay or give, any third party any money or other consideration for obtaining this Agreement. Third parties, for the purposes of this Section 17, shall not include persons to whom fees are paid for professional services, if rendered by attorneys, financial consultants, accountants, engineers, architects, brokers and other consultants, when such fees are considered necessary by the Developer. 18. Acceptance of Agreement by Developer. The Developer shall acknowledge its acceptance of this Agreement by delivering to the City three (3) original counterpart executed copies of this Agreement signed by the authorized representative(s) of the Developer. 19. Counterpart Originals. This Agreement may be executed by the City and the Developer in multiple counterpart originals, all of which together shall constitute a single agreement. 20. No Third-Party Beneficiaries. Nothing in this Agreement is intended to benefit any person or entity other t han the City or the Developer. 21. Governing Law. T he City and the Developer acknowledge and agree that this Agreement was negotiated, entered into and is to be fully p erformed in the City of Azusa, California. The C ity and the Developer agree that t hi s Agreement s hall be governed by, inte rpreted under, and construed and enforced in accordance with the laws of t he State of Cal iforn ia, without application of such laws' conflicts of laws principles. 45635.08005\24605171.12 22. Waivers. No waiver of any breach of any term or condition contained in this Agreement shall be deemed a waiver of any preceding or succeeding breach of such term or condition, or of any other term or condition contained in this Agreement. No extension of the time for performance of any obligation or act, no waiver of any term or condition of this Agreement, nor any modification of this Agreement shall be enforceable against the City or the Developer, unless made in writing and executed by both the City and the Developer. 23. Construction. Headings at the beginning of each section and sub-section of this Agreement a re solely for the convenience of reference of the City and the Developer and are not a part of this Agreement. Whenever required by the context of this Agreement, the singular shall include the plural and the masculine shall include the feminine and vice versa. This Agreement shall not be construed as if it had been prepared by one or the other of the City or the Developer, but rather as if both the City and the Developer prepared this Agreement. Un less otherwise indicated, all references to sections are to this Agreement. All exhibits referred to in this Agreement are attached to this Agreement and incorporated into this Agreement by this reference. If the date on which the City or the Developer is required to take any action pursuant to the terms of this Agreement is not a business day of the City, the action shall be taken on the next s ucceeding business day of the City. 24 . Attorneys' Fees. If either Party hereto files any action or brings any action or proceeding against the other arising out of this Agreement, then the prevailing Party shall be entitled to recover as an element of its costs of suit, and not as damages, its reasonable attorneys ' fees as fixed by the court, in such action or proceeding or in a separate action or proceeding brought to recover such attorneys' fees. For the purposes hereof the words "reasonable attorneys' fees" mean and include , in the case of the City, salaries and expenses of the lawyers working for or employed by the City (allocated on an hourly basis) to the extent they provide legal services to the City in connection with the representation of the City in any such matter. [Signatures on following page] 45635.08005\24605 17 1.12 THE CITY OF AZU SA EXCLUSIVE NEGOTIATION AGREEMENT (Keith Parry/D Club Property) IN WITNESS WHEREOF, the City and the Developer have executed this Negotiation Agreement on the dates indicated next to each of the signatures of their authorized representatives , as appear below. Dated: __________ _ Dated: ----------- Dated: __________ _ ATTEST: By: ____________ _ City Clerk APPROVED AS TO FORM: BEST BEST & KRIEGER, LLP By: _____________ _ City Attorney 4 5 635 .0 8005\24605 171 .12 DEVELOPER: EFP AR Development, LLC By: _____________ _ By: _____________ _ CITY: THE SUCCESSOR AGENCY TO THE REDEVELOPMENT AGEN CY OF TH E CITY OF AZUSA By: _____________ _ 45635.08005\24605171.12 EXHIBIT "A" TO NEGOTIATION AGREEMENT Property Legal Description EXHIBIT A Legal Description A.P.N. -8605-019-906 Those po1tions of Parcels 1 and 2 of Parcel Map , in the City of Azusa , County of Los Angeles, State of California, as per map recorded in Book 2 P age 9 of Parcel Maps in the Office of the Recorder of said County , described as follows : Commencing at the southeast corner of said Parcel 2 ; thence westerly along the southerly line of said Parcel 2 and also being the northerly line of Foothill Boul evard , a 100.00 feet wide street, as shown on said Parcel Map, S89°5 l '20"W 50.00 feet to the southwest comer of said Parcel 2 ; thence continuing westerly along said so utherly line , S89°5 l '20"W 34.00 feet to a line 34.00 feet easterly and parallel with the easterly line of said Parcel 1 and also being the True Point Beginning ; thence northerly along said parallel line, ~00°08'55"W 142.66 feet to a line 142.66 feet southerly and parall el with the said southerly line of said Parcels 1 and 2 ; thence easterly along said parallel line , N89°5 l '20"E 34.00 feet to the easterly line of said easterly line of said Parcel 1 ; thence continuing easterly a long said parallel line, N89°51 '20"E 50.00 feet to the easterly line of said Parcel 2; thence northerly along said easterly line, N00°08'55"W 127.16 feet to the northerly line of said Parcel 2 and also the southerly line of Industrial Street, a 36.00 feet and 30.00 feet wide street; thence westerly along said northerly line, S89 °51 '20"W 50.00 feet to the westerly line of said Parcel 2 ; thence southerly along said westerly line , S00°08'55"E 5.00 feet to the northerly line of said Parcel 1 and also the south erly line of said Industrial Street; thence westerly along said northerly line of Parcel 1 , S89°5 l '20"W 183 .28 feet to the beginning of a curve, concave southeasterly, having a radius of 15 .00 feet; thence southwesterly along said curve, through a central angle of 90°00' 15" , an arc length of 23 .56 feet to the westerly line of said Parcel 1 and also the easterly line of Miller Avenue (formerly Lucky Avenue), a 60.20 feet wide street; thence southerly along said westerly line, S00°08'55"E 224.82 feet to th e beginning of a curve , concave northeasterly, having a radius of 25.00 feet ; thence southeasterly along said curve, through a central angle of 89°39'45", an arc length of39.27 feet to the southerly line of said Parcel l ; thence eas terly along said sbutherl y line , N89°5 l '20"E 139.28 feet to the True Point of Beginning. ( See Exhibit 'C') Area = 53,834 Square Feet, 1.236 Acres 1 ); . /;_-. /ltt, 4) ./ Lega l Description A .P.N. -8605-019 -907 Those portions of Parcels 1 and 2 of Parce l Map , in the City of Azusa , County of Los Angeles , State of California , as per map recorded in Book 2 Page 9 of Parcel Maps in th e Office of the Recorder of said County , described as follows : Beginning at the southeast corner of said Parcel 2 ; thence westerly along the southerly line of said Parcel 2 and also being the northerly line of Foothill Boulevard, a 100.00 feet wide street, as shown on said Parcel Map, S89°51'20"W 50.00 feet to the southwest comer of said Parcel 2 ; thence continui ng westerly along said southerly line, S89°5 l '20"W 34.00 feet to a line 34.00 feet easterly and parallel with the easterly line of said Parcel 1 ; thence northerly along said parallel line, N00°08'55"W 142.66 feet to a line 142.66 feet southerly and parallel with the said so utherly line of said Parcels 1 and 2 ; thence easterly along said parallel line, N89°51 '20"E 34.00 feet to the easterly line of said easterly line of said Parcel 1 ; thence continuing easterly along said parallel li ne, N89°51 '20"E 50 .00 feet to the easterly line of said Parcel 2 ; thence southerly al ong said easterly li ne , S00°08'55 "E 142.66 feet to th e Point of Beginning. 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