hawkshaw eastside

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MEMOR N UM

TO: Ericka L. BurnettCity ClerkDATE: November 28, 2007RE: Hawkshaw Eastside, Inc. Documents

Attached for your files please find an originally executed and recorded Memorandumof Development Agreement as well as a originally executed Amended Agreement forDevelopment and Disposition of Property in the above referenced matter.

.JWF/jlmcc: Thomas J. Bonfield, City ManagerRebecca Bray, Interim CRA Director


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Ernie Lae MagalwCLERK OF THE CIRCUIT COURTESCAMOIA COUNTY FLORIDAINSTS 200711002511/28/2007 at 10:32 AMOFF REC BK: 6 53 PG: 284 - 287 Doc Type: MEMRECORDING: 35.50

MEMORANDUM OF DEVELOPMENT AGREEMENTThis Memorandum of Agreement for Development and Disposition of Property

( Memorandum ) is made this day of N Uit E C. , 2007, by and between theCOMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF PENSACOLA, FLORIDA, apublic body corporate and politic of the State of Florida created pursuant to Part III, Chapter 163,Florida Statutes (the Agency ), and HAWKSHAW EASTSIDE, INC., a Florida corporation (the Developer ).

This Memorandum pertains to an agreement by and between the Agencyand the Developer, dated as of November 13, 2007 (the Development Agreement ), whichprovides, among other things, for the sale of property described as:

All of Block 5, New City Tract, City of Pensacola, EscambiaCounty Florida, according to the map of said city copyrightedby Thomas C. Watson in 1903.

and for the development and construction of a mixed-use project on said property and certain landsadjacent thereto as depicted in Exhibit A attached hereto consisting of residential and commercialunits/space, as same are described and defined in the Development Agreement.

The Development Agreement is incorporated herein and made a part hereof byreference as fully as through it were set forth herein in its entirety. It is the intention of the partiesto hereby ratify, approve and confirm the Development Agreement as a matter of public notice andrecord. Nothing herein shall in any way affect or modify the Development Agreement, nor shall theprovisions of this Memorandum be used to interpret the Development Agreement. In the event ofconflict between the terms of this document and those contained in the Development Agreement,the terms in the Development Agreement shall control.

This Memorandum replaces and supercedes that certain Memorandum ofDevelopment Agreement between the parties, dated March 14, 2007, recorded in Official RecordBook 6106 at Page 869 of the Public Records of Escambia County, Florida.

A copy of the fully-executed Development Agreement is on file with the City Clerk,City of Pensacola, Florida.

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IN WITNESS WHEREOF, the parties hereto have set their hands and their respective sealsaffixed as of their day of No1tMM- x2007.

COMMUNITY REDEVELOPMENT AGENCYOF THE-CITY OF PENSACOLA, FLORIDA

City Manager(SEAL)ATTES :B yExecutive DirectorSTATE OF FLORIDACOUNTY OF ESCAMBIA

Signatures Continue Next Page)

The foregoing instrument was acknowledged before me this 4 1 day ofNovember, 2007, by Thomas J. Bonfield and Rebecca V. Bray , the City Manager and InterimDirector of the Community Redevelopment Agency of the City of Pensacola, Florida. They arepersonally known to me or

William Whitesell, Preside

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(SEAL)Printed/Typed Name: O_PM CNotary Public-State of Florida a , a y a C Robyn M. TiceCommission Number: 05 Commission # DD418

^ Expires June 6, 200OF F^- Bonded Troy Fain - Insurance no No.30.HAWKSHAW EASTSIDE, INC.a Florida Corporation


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STATE OF FLORIDACOUNTY OF ESCAMBIAr'The foregoing instrument was acknowledged before me this 23 day of

November, 2007, by William Whitesell, as President, and James J. Reeves, as Secretary, ofHawkshaw Eastside, Inc, a Florida corporation. They are personally known to me or have producedvalid driver's licenses as identification.

(SEAL)OL L) L/^JENNIFER S. REAMSCOMM* noWmr*E V +AM0 ... aru cIOC)4^-116{o t twumt

Name : Eli FEe. S. Notary Public-State of FloridaCommission Number: ;p 6 tja1? -Y $

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EXHIBIT A

68+/- total on grade parking spaces(Future P arking G arage)Phase I30,000 SF. (min) Mixed-use Building(with 30 workforce housing units)Ph ase II50,000 S,F. (min )Mixed -use Bulldi rigCo-Development PropertySubject roperty

Phase II I60,0 00 S.F. rniri) Off ice To-,rver

HAW HAW i

Chase St. J \

:ilr rf Nr ; nllrrf Pa llrrr: ^ ^ rr Mr X4 M ti

: e :

A Moulton PropertyCaldwell Associates Architects, Inc.


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AMENDED AGREEMENT FOR DEVELOPMENTAND

DISPOSITION OF PROPERTY(Hawkshaw Eastside Project)

This Amended Agreement for Development and Disposition of Property ( Agreement )is made as of this 13th day of November , 2007, by and between the COMMUNITYREDEVELOPMENT AGENCY OF THE CITY OF PENSACOLA, FLORIDA, a public bodycorporate and politic of the State of Florida created pursuant to Part 111 , Chapter 163 , FloridaStatutes ( Agency ), whose address is 180 Governmental Center, Pensacola , Florida 32521, andHAWKSHAW EASTSIDE, IN C., a F lorida for-profit corporation ( Developer ), whose address is380 Lu rton Street , Pensacola F lorida 32505.

WITNESS ETH:WHEREAS , as of August 31, 2006, pursuant to the Request for Proposal No. 06- 039, datedMarch 12, 2006, the Community Redevelopment Agency of the City of Pensacola , F lorida (the

Agency ) accepted the proposal of Developer dated June 6, 2006, in response thereto, subject tonegotiation of a definitive agreement with Developer pertaining to and setting forth the terms andconditions for the development of a mixed use project in the community redevelopment area of theCity on a site bordered by E ast Romana Street on the south , Colfax Street on the north, 9th Avenu eon the west , and 10th Avenue on the east , consisting of approximately 1.8 acres; and

WHEREAS, the Agency proceeded with the preparation of a definitive development anddisposition agreem ent to set forth the respe ctive du ties and responsibilities of the parties pertainingto the conveyance of the Subject Property (as hereinafter defined ), and the design, development,construction , completion and maintenance of a project thereon; and

WHEREAS the F lorida Legislatu re has fou nd that governmental sponsored pu blic -privatepartnerships and the promotion and support , including financial assistance , of economicdevelopment is in the pu blic interest and achieves pu blic benefit; and

WHEREAS Agency is authorized by Part III of Chapter 163, F lorida Statutes , to enter intoagreements regarding the development and redevelopment of property located in a communityredevelopment area; and

WHEREAS , Agency desires to encourage private sector redevelopment of the communityredevelopment area in general and the Project Site (as hereinafter defined) in particular and iswilling to enter into this Agreem ent to provide for, implement and encou rage a qu ality developmentof the Project Site that: ( i) is consistent with the comprehensive plan of the City of Pensacola andthe Land Development Code (as hereinafter defined ); and (ii ) implements the goals, standards andobjectives set forth in the Plan and the Gateway Redevelopment District Ordinance; and


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WHEREAS Agency finds Developer has made the requisite showing to support approvalof this Agreement and the P roject as described herein; andWHEREAS , Agency has affirmatively voted to approve this Agreement , finding it to be in

the best interest of Agency and the health , safety an d welfare of the citizens of City , and finding thatthe Project will result in enhanced economic benefit to the community redevelopment area withrespect to the stability and potential fo r future development of properties therein; and

WHEREAS, Agency, pursuant to such approval , desires to enter into this Agreement toprovide a quality development i n the form of the Project and has authorized and directed theappropriate officials of the Agency to execu te same; and

WHEREAS , Developer hereby affirms and acknowledges that everything contracted for,negotiated acknowledged and affirmed herein by D eveloper is done freely and voluntarily; and

WHEREAS , at a duly called public meeting on November 13, 2007, the Agency approvedthis Agreement and au thorized and directed its execu tion by the appropriate officials of the Agency ;and

WHEREAS the Developer has approved this Agreement and certain individuals areau thorized to execute this Agreement on behalf of Developer; andWHEREAS on or about February 5, 2007, the Agency and Developer entered into that

certain Agreement For Development and Disposition of Property relative to the HawkshawEastside Project; and

WHEREAS , on or about June 11, 2007, the Agency approved a change in theDeveloper's corporate structure including new principals to said entity; and

WHEREAS, as a result of the Developer's addition of additional principals, theDeveloper has available to it property adjacent to the Subject Property upon which it intends toexpand the scope and breadth of the project; and

WHEREAS , the Agency and the Developer are currently working on a stormwaterfacility immediately adjacent to the site which would have a substantial and positive benefit tothe Project Site and the density which can obtained on the Project Site; and

WHEREAS , the parties wish to supplant replace, supersede , and amend theirAgreem ent as set forth hereafter.

NOW, THEREFORE , in consideration of the mutual promises and covenants containedherein, the parties hereby supplant, replace, supersede, and amend their Agreement as follows:

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ARTICLE 1. DEFINITIONS.1.01. Definitions. The terms defined in this Article l shall have the following

meanings, except as herein otherwise expressly provided: Act means the Constitution of the State of Florida; Section 163.01, Florida

Statutes, Part 111, Chapter 163, Florida Statutes; Chapter 166, Florida Statutes, other applicableprovisions of law, and ordinances and resolutions of the City and the Agency implementing them.

Agency means the Community Redevelopment Agency of the City, as createdby Resolution No. 55-80 of the City, adopted by the City Council on September 25, 1980, includingany amendments thereto, and any successors or assigns thereto which can exercise redevelopmentpowers.

Agreement means this Agreement for Development and Disposition ofProperty, including any Exhibits, and any amendments hereto or thereto.

Agreement Effective Date means the date determined in accordance withSection 17.20 when this Agreement becomes effective.

Agreement Expiration Certificate means the instrument executed by the partieshereto as provided in Section 17.19 certifying that all obligations of the parties hereto have beensatisfied, including the completion of the development of the Project by the Developer ascontemplated herein, and, consequently, this Agreement has expired in accordance with its terms,the form of which is attached hereto as Exhibit B.

Agreement Termination Certificate means the instrument executed by theparties hereto as provided in Section 13.06 stating that this Agreement has been terminated prior toits Expiration Date as provided in Section 13.05, the form of which is attached hereto as ExhibitC

Area means the area located within the corporate limits of the City havingconditions of slum and blight (as those conditions are defined in the Act) as found by the CityCouncil in Resolution No. 65-81 adopted by the City Council on October 22, 1981.

Building Permit means, for all or any part of the Project to be constructed onthe Project Site, any permit issued by the City or other applicable governmental authorityauthorizing, allowing and permitting the commencement, prosecution and completion ofconstruction of any structure on the Project Site to the extent provided in said permit, including anyindividual Unit comprising part of the Project.

City means the City of Pensacola, F lorida, a F lorida mu nicipal corporation, andany su ccessors or assigns thereto.

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City Council means the elected governing body of the City by whatever nameknown from time to time.

Closing Date means the date on which title to the Subject Property is conveyedby the Agency to the Developer in accordance with and as contemplated by the provisions of Article7 hereof.

Co-Developer means Moulton Properties, Inc., a Florida for-profitcorporation, and any successors and assigns thereof to the extent of any such assignment.

Co-Development Property shall mean the approximate two (2) acres of realproperty owned and controlled by Moulton Properties, Inc., immediately abutting the SubjectProperty to the north.

Contractor means one or more individuals or firms constituting a generalcontractor or other type of construction contractor which, in compliance with applicable law, isproperly licensed by the State of Florida or other appropriate jurisdiction to perform constructioncontractor services in the State of Florida, and, if required, is registered with the City.

Developer means Hawkshaw Eastside, Inc., a Florida for-profit corporation,and any successors and assigns thereof to the extent of any such assignment.

Exhibits means those agreements, diagrams, drawings, specifications,instruments, fonns of instruments, and other documents attached hereto and designated as exhibitsto, and incorporated in and made a part of, this Agreement.

Expiration Date means the date on which this Agreement expires, as evidencedby the Agreement Expiration Certificate being recorded in the public records of Escambia County,Florida, as provided in Section 17.19 hereof.

Gateway Redevelopment District means that area within the City having thezoning classification of GRD-1 as provided in the City's zoning code and the GatewayRedevelopment District Ordinance.

Gateway Redevelopment District Ordinance means the ordinance orordinances, including amendments or supplements thereto, creating the zoning classification knownas GRD-l, which provides for particular uses within the Gateway Redevelopment District subject tothe terms, conditions, standards and requirements for such use or uses, which provide for (i) thelocation of buildings, parking, sidewalks and streets, (ii) building elevations, (iii) architectural style,(iv) exterior materials, (v) set-backs of structures, and (vi) the appearance and relationship of thevarious components of the Project.

Gateway Redevelopment District Review Board or Review Board means theboard of the City which reviews plans for improvements and structures proposed to be constructedin the Gateway Redevelopment District.

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Joint Venture means Developer and Co-Developer. Land Development Code means the regulations of the City governing the

construction and use of structures in the City, including the Gateway Redevelopment District. Permits means all zoning, variances, approvals, permits and consents required

to be granted, awarded, issued, or given by any governmental authority or public utility entity inorder for construction of the Project to occur on the Project Site, or any part thereof, to commence,continue, and be completed, but does not include any Building Permit as defined in g hereof.

Phase means any part of the Project undertaken by the Developer from time totime as provided herein.

Phase I Project means that part of the Project undertaken by the Developeras depicted on Exhibit A hereto, represented by the first building ( Building A ) which willfront on 9t Avenue. The Phase I Project will consist of approximately 30,000 sq.ft. of mixed-use space, including 30 Work Force Housing Units. This Building will be complete withintwenty-four (24) months from closing, or July 1, 2010, whichever occurs first.

Phase 11 Project means that part of the Project undertaken by the Developeras depicted on Exhibit A hereto, represented by the second building ( Building B ) which willfront on Romana Street. The Phase II Project will consist of a minimum of 50,000 sq.ft. ofmixed-use space. This Building will be complete within 36 months from closing, or July 1, 2011,whichever occurs first.

Phase III Project means that part of the Project undertaken by the Developeras depicted on Exhibit A hereto, represented by the third building ( Building C ) which iscontemplated as a tower not to exceed 80' (excluding parapet, stair, and mechanical structures)in height. Building C will consist of a minimum of 60,000 sq.ft. This Building will becomplete no later than 60 months from closing, or July 1, 2013, whichever occurs first.

Plan means the community redevelopment plan for the Area, including theProject Site, as adopted by the City Council on March 27, 1984 by enactment of its Resolution No.15-84, and inclu ding any amendm ents to the Plan.

Plans and Specifications means the plans and specifications for theconstruction of the Project and any part thereof, including vertical elevations, floor plans,location of structures on the Project Site, ingress and egress onto and from the Project by motorvehicle or pedestrians, and infrastructure improvements (including drainage, water retention,water and sewer lines).

Project shall mean each Phase 1-111 Project described above, construction ofall other improvements, landscaping, and am enities depicted on Exhibit A.

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Project Completion means the date for each Phase of the Project on whichconstruction, installation or equipping of substantially all of the required components of thePhase have been substantially completed in accordance with the Plans and Specifications asevidenced by the issuance of a final certificate of occupancy for all improvements and/or lotscontemplated within the scope of the Project.

Project Effective Date means the date following the Closing Date determinedin accordance with Section 8.05 when the Developer is committed to commence construction of thePhase I of the Project as provided herein.

Project Financing means the financing provided by a Project Lender to theDeveloper for the acquisition of the Subject Property, and the construction and development of theProject, or any Phase.

Project Lender means the one or more person or persons providing the ProjectFinancing.

Project Professionals means any firm of architects, attorneys, brokers,engineers, consultants, planners, construction managers or any other persons, or combinationthereof, retained or employed by the Developer with primary responsibility for the planning, design,construction, permit applications, and completion of the Project.

Project Site means the Subject Property together with the Co-DevelopmentProperty immediately north thereof owned by Moulton Properties, Inc. south of the right-of-wayof Aragon Street and the Right-of-Way.

Proposal means the Developer's proposal, the original version of which wasdated June 6, 2006, submitted by the Developer to the Agency in response to the RFP, and asamended or changed as provided in this Agreement.

Review Board means the Gateway'Redevelopment District Review Board. RFP means the Request for Proposal No. 06-039 published by the Agency on

March 12, 2006, soliciting proposals from persons interested in redeveloping the Project Site inaccordance with the Act and the Plan.

Right -of-Way means Colfax Street adjacent to the Project Site. Site Plan means the depiction and description of all Phases and aspects of theProject on the Project Site, including the conceptual depiction of the Project, the preliminary and

conceptual version of which are attached to this Agreement as Exhibit A. Subject Property means that part of the Area, as is more particularly described

as follows:

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All of Block 5, New City Tract, City of Pensacola, Escambia CountyFlorida, according to the map of said city copyrighted by Thomas C.Watson in 1.903, together with the Right-of-Way,

which is to be conveyed by the Agency to the Developer pursuant to Article 7 hereof on which theDeveloper will develop the Project as provided in this Agreement.

Termination Date means the date on which this Agreement is terminated byany. party hereto as provided in Section 13.05, as evidenced by the Agreement TerminationCertificate described in Section 13.06.

Unavoidable Delay means those events constituting excuse from timelyperformance by a party hereto from any of its obligations hereunder, as such events are defined inand subject to the conditions described in Article 14 hereof.

Unit means a part of the Project consisting of habitable residential Units orspace, including kitchen and bathroom facilities, single family residential lots, or commercialspace.

Workforce Housing means a residential Unit having not less than 500 squarefeet and a sales price of not more than $250.00 per square foot. The exact size and scale ofWorkforce Housing Units shall be determined by market demands and conditions.

1.02. Use of Words and Phrases. Words of the masculine gender shall be deemed andconstrued to include correlative words of the feminine and neuter genders. Unless the context shallotherwise indicate, the singular shall include the plural as well as the singular number, and the word person shall include partnerships, corporations, associations or other legal entities, includingpublic bodies, as well as natural persons. Herein, hereby, hereunder, hereof, hereinbefore,hereinafter and other equivalent words refer to this Agreement and not solely to the particularportion thereof in which any such word is used. The words party or parties when referring tothe initial signatory parties to this entire Agreement shall also mean and include any successor orassign of such party. References to Agency and Developer may refer to and include theAuthorized Representative thereof designated in accordance with Section 2.04 to the extent theAgency or Developer has authorized its authorized representative to act on its behalf.

1.03. Florida Statutes All references herein to Florida Statu tes are to F lorida Statu tes(2007), as amended from time to time.ARTICLE 2. PURPOSE; PROPOSAL.

2.01. Intent; Purpose of Agreement.(a ) The purpose of this Agreement is to further the implementation of the Plan by

providing for the conveyance of the Subject Property to the Developer and the development andconstruction of the Project on the Project Site in accordance with the Plan and the Plans and

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Specifications , all to enhance the qu ality of life, increase employm ent and improve the aesthetic anduseful enjoyment of the Area through the eradication of conditions of slum and blight, all inaccordance with and in fu rtherance of the Plan and as au thorized by and in accordance with the Act.

(b) The Project Site is to be redeveloped according to Plans and Specificationsfor the Project as nearly as possible.

(c) As provided in this Agreement, the Agency intends to undertake certainpublic actions pursuant to the Act and as implementation of the Plan, including making theSubject Property available for redevelopment by the Developer , and assistance in obtainingapprovals by governmental authorities , including the City, and the vacating of the Right - of-Way,as are necessary for development of the Project Site .

(d) As provided in this Agreement , the Developer shall carry out theredevelopment of the Project Site by purchasing the Subject Property from the Agency obtainingapprovals by governmental authorities, including the City, necessary for development of theProject, and constructing or causing the Contractor to construct the Project on the Project Site inaccordance with the Plans and Specifications.

(e ) Nothing in this Agreement , specifically including this Section 2.01 expresslyor implied, is intended by the parties hereto, individually or collectively, to construe or shall beconstrued to confer upon any person , firm or corporation other than the parties hereto, any right,remedy, or claim , legal or equ itable , under or by reason of this Agreement or any provision hereof.It is the intent of the p arties hereto that this Agreemen t and all its provisions are intended to be andare for the sole and exclusive benefit of the parties hereto.

2.02. Developer s Proposal.(a ) The Proposal for the redevelopment of the Project Site , specifically including

the acquisition of the Subject Property and the preliminary and conceptual design, construction,equ ipping, completion and operation of the Project, and each com ponent thereof, is hereby found bythe Agency and acknowledged by the Developer : ( 1) to be consistent with and in fu rtherance of theobjectives of the Plan, (2 ) to conform to the provisions of the Act, (3) to be responsive to the RFP,(4) to be in the best interests of the citizens of the City, (5) to further the purposes and objectives ofthe Agency, and (6 ) to fu rther the pu blic purpose of eradicating conditions of slu m and blight in theArea.

(b ) Based u pon and as a resu lt of the findings set forth in su bsection ( a) above, theProposal, including such changes and revisions as are provided by this Agreement , is herebyaffirmed by the Developer and approved and accepted by the Agency .

(c) The parties hereto find that the terms and conditions set forth in thisAgreement do not , individually or collectively constitute a substantial deviation from the RFP orthe Proposal.

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(d ) The parties recognize and agree that during the process of review and approvalprovided for in this Agreement the design and construction cost of the Project will be subject tochange and modification as may be either agreed to by the parties or as required by the appropriateregulatory authority.

2.03. Cooperation of the Parties. The parties hereto recognize that the successfuldevelopment of the Project and each component thereof is dependent upon continued cooperation ofthe parties hereto, and each agrees that it shall act in a reasonable manner hereunder, provide theother party with complete and updated information from time to time, with respect to the conditionssuch party is responsible for satisfying hereunder and make its good faith reasonable efforts toensure that such cooperation is continuous, the purposes of this Agreement are carried out to the fullextent contemplated hereby and the Project is designed, constructed, equipped, completed andoperated as provided herein.

2.04. City's Actions.(a ) The parties recognize and acknowledge that the City, as a general purpose unitof local government possessing certain sovereign and governmental powers, including the power to

tax, may not contractually obligate itself now or in the future to exercise or not exercise thosepowers or subject the exercise of those powers to certain terms and conditions.

(b ) The Agency represents to the Developer that the City has agreed with theAgency to consider certain actions which the Developer has represented to the Agency arecritical to the successful development of the Project as contemplated by this Agreement,including a complete vacation of the final portion of Colfax Street in order to facilitate thenorth/south orientation of the Workforce Housing Units an additional related development of theCo-Development Property. In addition, there are certain land use ordinance/variance requestswhich are necessary for the development of the Project Site and the Co-Development Property.Those specific items are as follows:

(1) Setbacks 12-2-12 (A)(4)(c): Requires setbacks of 5 or 10 feet from right-of-way. Variance needed on setback requirements based on urban character of design . Requires75% maximum lot coverage.

(2 ) Lot Coverage 12-2-12 (A)(4)(i): Variance required to exceed 75% lotcoverage based on u rban character of design.

(3 ) Landscaping Coverage 12-6: Requires guidelines to be followed for zonesnot listed. Typical coverage requirement is 20-25%. Variance required to have less coverage oflandscaping based on urban character of design.

(4) Parking Count 12-3: Requires parking ratios from 1/75 SF to 1/300 SF.Variance needed to use 3/1000 SF parking ratio across site due to currently undefined multipleuses and staggered use times across the site.

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(5) General Notification Enactment of an ordinance by the City of Pensacolavacating and closing of one block of Colfax from 9th Avenue to 10th Avenue.

(6) Hawkshaw Eastside , Inc., Moulton Properties Inc., and the City ofPensacola shall exercise their best reasonable efforts to agree to and enter into an agreement toprovide a wet retention facility /park amenity on the site know as Admiral Mason Park to beconstructed by Hawkshaw Eastside , Inc. The agreement will include a provision that the Citywill grant Hawkshaw Eastside, Inc., and Moulton Properties, Inc., a perpetual drainage easementfor both the Project Site and the adjacent property owned by Moulton Properties, Inc. south ofSalamanca Street .. The agreement must provide that the Developer and Moulton Properties, Inc.,will construct the facility at their expense and contribute $ 300,000.00 to the construction ofpublic amenities around the new retention facility /park amenity. The agreement will furtherprovide that the City will have approval rights over the appearance size, design , dimensions,contours , berm heights and amenities at the site . Other future contributors to the retentionfacility will be required to negotiate with the City and pay for any expansion of the lake. Furtherengineering study will be undertaken prior to closing to assure that the retention area will havesufficient capacity for the total intended drainage basin . In addition , the ongoing expense ofmaintaining the retention facility will be funded through a MSBU created by ordinance passedby the City of Pensacola . All maintenance of the retention facility will be paid by the users ofthe facility on a pro rata basis.

The Developer acknowledges and agrees that the CRA cannot grant theaforementioned variances . Rather, the Developer will diligently endeavor to obtain the variancesfrom the appropriate body. Nevertheless, the Developer Venture is requesting the CRA'sagreement to take such actions that are necessary to encourage the implementationcommencement and completion of said variances for the benefit of the Joint Venture. In the eventthe appropriate governmental body, including the City, denies or rejects any variances or approvals setforth in this subsection ( b) , Developer agrees that such is not an event of default by the CRA and that itsonly remedy in such an event is to terminate this Agreement as provided in Article 13.

The grant of the foregoing land use ordinance /variance requests is criticalto the successful development of the Project . The Agency ' s agreement to take such actions thatare necessary to encourage the implementation , commencement and completion of said actions ismaterial to the success of the development on the Project Site and the Co-Development Property.

(c) The Agency agrees to take such actions as may be necessary from time to timeto encourage the City to implement , commence and complete the actions required to be taken by theCity necessary for development of the Project on the Project Site . Nothing in this subsection (c) isintended or shall be deemed to give the Developer any right to recover damages in any actionbrought by the Developer for the purpose of enforcing this subsection (c). This subsection (c) doesnot preempt the Developer from simultaneously or otherwise seeking any relief which may beavailable in the event of a default by the Agency under Section 13.02 hereof.

(d ) The Developer represents to the Agency that the City vacating the Right-of-W ay is critical to the su ccessful development of the Project. F ailure of the City to vacate the Right-

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of-Way by the Closing Date shall be a basis for the Developer terminating this Agreement pursuantto Section 13.05.ARTICLE 3. LAND USE REGULATION.

3.01. Zoning ; Gateway Redevelopment District Ordinance.(a) On the Agreement Effective Date the zoning classification for the Project Site

is GRD-l.(b) The Agency agrees to cooperate with the Developer concerning any approvals

by the Review Board under the Gateway Redevelopment District Ordinance pertaining to theProject. 3.02 [INTENTIONALLY O M ITTE D ]

3.03. Permits.(a ) The Developer shall prepare and submit to the appropriate governmental

authorities including the City, the applications for any and all necessary Permits for theconstruction installation and completion of the Project and shall bear all costs of preparing suchapplications apply ing for and obtaining such perm its including payment of any and all applicableapplication , inspection regulatory and impact fees or charges.

(b ) The Agency's duties, obligations, or responsibilities under any section of thisAgreement, specifically including but not limited to this Section 3.03 do not affect the City's right,duty, obligation, authority and power to act in its governmental or regulatory capacity in accordancewith applicable laws, ordinances, codes or other building or project regulation.

(c) Except as specifically provided herein the parties acknowledge and agree thatany required permitting licensing or other regu latory approvals by the City shall be subject to theestablished procedures and requirements of the City with respect to review and permitting of aproject of a similar or comparab le natu re, size and scope as the Project.

3.04. Concurrency.(a ) The parties hereto recognize and acknowledge that Florida law (specifically,

Part II, Chapter 163, Florida Statutes, and Rule 9J-5, Florida Administrative Code, collectively the Growth Management Act ) impose restrictions on development if adequate public improvementsare not available concurrently with that development to absorb and handle the demand on publicservices caused by that development. As of the Agreement Effective Date, the parties agree that theProject, as proposed, does not generate sufficient traffic or other impacts as to be adversely affectedby the City's concurrency management requirements, and the parties further agree that the City hasby letter to the Developer acknowledged the Project's projected traffic trips are below the thresholdsfor invoking any concurrency compliance actions, and that the trips to be generated by the Projectwill be reserved within the existing capacity of the Area.

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3.05. Land Development Code. The Developer agrees to comply with therequirements of the City's Land Development Code.

3.06. Not a Development Order or Permit. The parties hereby acknowledge, agreeand represent that this Agreement is not intended to be and should not be construed or deemed to bea development order or development permit within the meaning of those terms in Section163.3164, Florida Statutes.ARTICLE 4. PLANS AND SPECIFICATIONS.

4.01. Site Plan.(a ) The parties recognize and acknowledge that the Site Plan included in the

Proposal was conceptual and preliminary, but subject to change as a result of discoveredenvironmental or site conditions and for the purposes of improving traffic flow, delivery of publicservices, modifying open space areas, and consistency with the City's Land Development Code.

(b ) The Developer acknowledges and agrees that the Site Plan shall be the basisfor the Plans and Specifications , and said Site Plan shall not be substantially amended or alteredexcept approved by the Agency and Developer.

(c ) The Developer covenants an d agrees that the Plans and Sp ecifications shall beconsistent with Site Plan.

4.02. Preparation-of Plans and Specifications.(a) The Developer shall prepare, or cause to be prepared, the Plans and

Specifications in sufficient detail and description of the Project Site, both narratively andgraphically, to allow the Agency the opportunity to determine if those plans and specificationsare consistent with the Proposal and the Site Plan.

(b)(1) The Developer is responsible for the cost of preparing, submitting andobtaining approval of the Plans and Specifications.

(2 ) The Developer has retained and shall retain Project Professionals to preparethe Plans and Specifications, and shall notify the Agency of the names of such ProjectProfessionals and any subsequent changes thereto or additional Project Professionals retained withrespect to the Project. The Developer shall cause the Project Professionals to prepare the Plans andSpecifications.

(c)(1) The Agency does hereby consent to the preparation of the Plans andSpecifications, and any revisions thereto, by the Project Professionals. The Agency herebyacknowledges and agrees that the selection of the Project Professionals was and is the sole respon-

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sibility of, and within the discretion of, the Developer, and the Agency will not participate, and hasnot previously participated, in such selection by the Developer.

(2 ) The parties hereto mutually acknowledge and agree the Project Professionalsare not, individually or collectively, agents or representatives, either expressed or implied, of theCity or the Agency.

(d) The Developer shall file Preliminary Plans and Specifications for thehorizontal or site improvements and construction for the Phase I Project with the Agency no laterthan seventy-five (75) days after the issuance of a Florida Department of EnvironmentalProtection Permit for Construction of a Wet Retention/Lake facility sufficient to provideretention and drainage capacity for the Project Site and the property controlled by MoultonProperties, Inc. south of Salamanca Street.. The Developer shall file Preliminary Plans andSpecifications for all vertical components of the Phase I Project within sixty (60) days of filingsuch Preliminary Plans and Specifications for the horizontal elements of said phase. The Plansand Specifications contemplated by this subsection (d) shall be sufficient for a determination bythe Agency that such plans and specifications, as near as practical, are consistent with theProposal, the Site Plan. Preliminary Plans and Specifications for horizontal and verticalconstruction of subsequent phases shall be filed sufficiently in advance of the commencement ofconstruction of said phases to permit construction to begin and proceed timely and without unduedelay.

(e ) The Developer shall file the final Plans and Specifications with the Agencyprior to commencement of construction on the Project Site, which Plans and Specifications shall beapproved by the Agency prior to such commencement.

(f ) The Plans and Specifications prepared and filed by the Developer andreviewed and approved by the Agency are not necessarily the plans and specifications preparedby the Developer and filed with the City for regulatory review and approval by the City acting inits governmental capacity pursuant to applicable codes and ordinance and for the issuance of anypermit , license or other governmental approval

4.03. Coordination with City Review. The Agency agrees its staff will use its bestefforts to coordinate and expedite its review of the Preliminary Plans and Specifications, and anypart thereof, with any review or approvals by the City and the Review Board.

4.04. Agency Review of Plans and Specifications.(a ) Upon the Developer submitting any Preliminary Plans and Specifications to

the Agency for review, the Agency will diligently proceed with and complete its review of thePreliminary Plans and Specifications and respond to the Developer as soon as reasonably possibleafter receipt thereof, but in no event later than thirty (30) days after receipt of such PreliminaryPlans and Specifications, and advise the Developer in writing of the Agency's objections orconcerns pertaining thereto or that the Preliminary Plans and Specifications are acceptable assubmitted.

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(b) If the Agency gives written notice of specific objections or concerns to ordeficiencies in the Preliminary Plans and Specifications as provided in subsection (a), the Developerand the Agency shall diligently and reasonably negotiate to resolve such objections or concerns.

(c ) If the Preliminary Plans and Specifications submitted to the Agency by theDeveloper are acceptable to the Agency, then the Agency shall notify the City and the ReviewBoard of such acceptance.

(d) If the Developer does not dispute the objections or concerns to the PreliminaryPlans and Specifications contained in any notice from the Agency pursuant to subsection (b), it shallsubmit revised Plans and Specifications satisfying such objections or concerns. Any changes in thePreliminary Plans and Specifications made by the Developer in response to such a notice shall bethe Developer's responsibility.

(e ) Any revised or changed Plans and Specifications made by or at the directionof the Developer shall be submitted by the Developer to the Agency for review and approval priorto any commencement of construction on the Project Site.

4.05. ECUA Sewer Taps.The Agency agrees to encourage the Escambia County Utilities Authority ( ECUA ) to

grant sewer connection credit (s), if any, for residential units previously located on the Project Siteand connected to the ECUA sewer system and to inform the Developer of the availability of anysuch credits by the time of the Closing Date.ARTICLE 5. Intentionally O m itted.ARTICLE 6. PROJECT FINANCING.

6.01. Project Financing.(a)(1) The Developer shall use its reasonable best efforts to obtain from a lender a

commitment to provide the Project Financing as soon as is reasonably possible. Upon obtainingsuch Project Financing, the Developer shall notify the Agency that it has obtained said financingand provide to the Agency the name and address of the Project Lender.

(2 ) The Developer will develop the Project Site in phases. Prior tocommencement of` any construction as to Phase I the Developer shall demonstrate to the Agencythat it has a commitment for financing from a Project Lender for the all elements of theWorkforce Housing and a preliminary letter of intent for financing any subsequent phases of theProject.

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(b ) The Developer covenants and agrees with the Agency that the proceeds of theProject Financing shall be used for the purpose of paying costs and fees related to the acquisition ofthe Subject Property and the development, construction and installation of the Project and that suchproceeds, together with its own funds or other funds available to it, shall be sufficient to pay thecosts of acquiring the Subject Property and the development, construction and installation of theProject.

6.02. Notice of Developer's Default.(a) The Developer covenants and agrees with the Agency that any financing

documents for the Project Financing shall include provisions to the effect that if any Project Lenderdeclares the Developer to be in default or if an event of default has occurred under such financingdocuments, then such Project Lender shall promptly give written notice thereof to the Agency bycertified mail, return receipt requested at its respective address last given to the Project Lender bythe Developer prior to such notice; provided, however, the failure of the Developer to provide theAgency's address to the Project Lender or for the Project Lender to receive any such notice ofAgency's address shall not constitute a waiver by or preclude or delay the Agency from proceedingwith or enforcing any right or remedy available to it under this Agreement, nor shall it constitute awaiver by or preclude or delay the Project Lender from enforcing any right or remedy available tothe Project Lender. The notice from the Project Lender to the Agency shall state the basis of thedefault by the Developer, including the provision of the financing documents under which theDeveloper is in default and shall include copies of any pleadings in any proceeding instituted by theProject Lender incident thereto.

(b ) Any notice from the Agency to the Developer specifying an event of defaultby the Developer under Section 13.01 hereof shall, at the same time it is provided to the Developer,be mailed to any Project Lender by certified mail, return receipt requested, at its address last givento the Agency by the Developer prior to such notice; provided, however, the failure of the Agencyto mail any such notice of an event of default by the Developer under this Agreement or the failureof the Project Lender to receive any such notice shall not constitute a material breach or default ofthis Agreement by the Agency, nor shall it constitute a waiver by or preclude or delay the ProjectLender from proceeding with or enforcing any right or remedy available to it under the ProjectFinancing, nor shall it constitute a waiver by or preclude or delay the Agency from enforcing anyrights or remedies available to Agency in connection with this Agreement. The notice from theAgency to the Project Lender shall state the basis of the default, the particular provision of thisAgreement under which the Developer is in default and shall include copies of any pleadings in anyproceedings instituted by the Agency incident thereto, if any.

6.03. Cure of Developer's Default by Project Lender.(a)(1) After the Agency provides the notice under Section 6.02(b) hereof prior to the

Project Completion Date, a Project Lender may, at its election, cure or remedy the default by theDeveloper described in such notice. If the Project Lender elects to cure such default, it shall givenotice of such election to the Agency and the Developer within sixty (60) days after the Agencyissued its notice of default by the Developer as provided in Section 13.01 hereof.

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(2) So long as the Project Lender proceeds to cure or remedy the Developer'sdefault of this Agreement , the Agency agrees not to exercise any right or remedy available to itresulting from the Developer ' s default described in the notice and which the Project Lender haselected to cure for such period of time as shall be reasonably necessary for the Project Lender tocure or remedy such default , including any time reasonably necessary for the Project Lender toobtain possession of the Subject Property, if possession is necessary to enable the Project Lender tocure or remedy such default . Any time periods or deadlines provided for in this Agreement shall beextended to the extent such time period or deadline is affected by any curative action taken by theProject Lender.

(b) If a default by the Developer under this Agreement is timely cured orremedied by the Project Lender pursuant to this Section 6.03, then the Agency shall not have anyrights or remedies against the Developer with regard to such default , except that in such an event,the Developer shall be obligated to pay and the Agency may recover from the Developer any fees,costs or other expenses ( including reasonable attorneys fees) incurred by the Agency as a result ofsaid default by the Developer , plus interest on such fees, costs or other expenses from the date theywere incurred at an annual percentage rate equal to the rate set by law for unpaid judgments.

(c) If the Project Lender elects to cure or remedy the Developer s defaulthereunder as provided in subsection (a) hereof, it shall then be subject to and bound by theprovisions of this Agreement and the actions required to be taken to remedy or cure said defaultthat , bu t for the default by the Developer , wou ld have been applicable to the Developer.

6.04. Agen c y Dealing Directly with Project Lender.Nothing in this Agreement is intended or shall be constru ed or applied so as to prevent or

restrict the Agency from dealing directly with the Project Lender in the event of a default by theDeveloper under the Project Financing for purpose of curing or otherwise resolving such default,inclu ding the payment of any ou tstanding mortgage debt or the purchase of the Subject Property , orany part thereof, from the Project Lender.ARTICLE 7 SUBJECT PROPERTY CONVEYANCE.

7.01. Findings; Representations.(a ) As of the Closing Date, the Agency will be the owner of the Subject

Property.(b) Developer desires to pu rchase the Su bject Property from Agency .(c ) Agency desires to sell and convey the Subject Property to Developer subject

to the terms of this Agreement.7.02. Agreement to Sell and Purchase.

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The Agency hereby agrees to sell and convey the Subject Property to Developer andDeveloper hereby agrees to purchase the Subject Property from Agency, upon the terms andconditions hereinafter in this Article 7.

7.03. Purchase Price.(a ) The amount to be paid by the Developer to the Agency to acquire the SubjectProperty shall be the aggregate amount of One Million Four Hundred Thousand Dollars

($1,400,000.00)(the Purchase Price ).(b ) The Developer has paid to the Agency a deposit equal to ten percent (10%) of

the aggregate Purchase Price, i.e., $140,000.00. The deposit shall be held by the Agency and shallbe refundable by the Agency to the Developer only if this Agreement is terminated pursuant toSection 13.05 because the City did not vacate the Right-of-Way by the date set forth therein.

(c ) The balance of the Purchase Price shall be paid by the Developer to the Agency atthe Closing in immediately available funds as provided in Section 7.10(c) hereof.7.04. Site Evaluation.(a ) The Developer has evaluated the Subject Property and the Project Site and hasdetermined that it is suitable for the development of the Project except as provided in Section

2.04(d).(b ) The Agency makes no representations or warranties to the Developer as to thecondition of the Subject Property, either surface or sub-surface conditions, and the Developer

acknowledges and agrees it is buying the Subject Property as-is.7.05. Title.(a ) By agreement of the parties the Developer shall order and will obtain anddeliver to the Agency, a copy of a title insurance commitment issued by

(through its agent Clark, Partington, Hart, et al.), which is a reputable Florida licensed title insurancecompany satisfactory to the Developer (it being understood that Attorneys' Title Insurance Fund,Inc., Lawyers Title Insurance Corporation, and Chicago Title Company, among others, will besatisfactory also) agreeing to issue to the Developer upon recording of the deed to the SubjectProperty an AI.,TA owner's marketability title policy in the full amount of the Purchase Priceinsuring the fee simple title, subject only to any exceptions as stated herein and such standardconditions and exceptions as are usually printed in policies issued by that title insurer, which theDeveloper will accept, provided the title is determined by the insurer to be marketable record title.The Developer and the Agency agree that Developer will pay at the Closing of the purchase thecost of such title insurance.

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(b) The Developer shall within thirty (30) days after the last of the following twoevents occurs to-wit: (1) receipt of the title commitment, or (2) the Effective Date of thisAgreement (which is the date on which the Memorandum of Development Agreement is recordedas provided in Section 17.15 and Section 17.20); deliver written notice to the Agency, of anyunacceptable title defects, if there he any. Title shall be deemed acceptable to the Developer if (1)the Developer fails to deliver proper notice of title defects as aforesaid within said period of time, or(2) if Developer delivers proper notice and the Agency is able to cure the defects within areasonable time, not to exceed ninety (90) days after receipt of the notice ( Curative Period ). If thedefects are cured within the aforesaid Curative Period to the satisfaction of the Developer, or if nonotice of any title defects is furnished to the Agency by the Developer within the required timeperiod, then and in that event the Agency's title for the purposes of this Agreement shall be held tobe an acceptable title, subject only to the inability of the Agency at the time of the Closing toconvey essentially the same merchantable or insurable title as set forth in the title insurancecommitment previously submitted and examined by the Developer without there being anyadditional encumbrances created or suffered by the Agency between that previous date of approvaland the Closing and Transfer of Title Date. The Agency may elect not to cure the defects, if theAgency reasonably believes that any cost to the Agency of curing would be in excess of the greaterof one percent (1%) of the Purchase Price or Ten Thousand Dollars $10,000.00; furthermore, theAgency shall not be obligated to maintain a legal proceeding or lawsuit to cure any defect withoutfurther negotiation and agreement between the parties relative thereto. If the defects are not curedwithin the Curative Period, the Developer shall have thirty (30) days from receipt of notice ofAgency's inability or unwillingness to cure the defects to elect whether to terminate this Agreementas provided in Section 13.05 or to agree in writing to accept the title subject to existing defects andclose without reduction in the Purchase Price and without any warranty by Agency as to, or against,the enforcement of such uncured defects. Nothing herein is intended to prevent the Developer fromagreeing to pay any cost to cure any title defects in excess of Ten Thousand Dollars ($10,000.00),and the Agency agrees that should the total cost to cure the defect be in excess of such amount itwill not object to the Developer paying any excess cost nor will the Agency seek to terminate thisAgreement pursuant to Section 13.05 so long as the Developer is paying such excess cost and theeffort to cure such defect is proceeding diligently and in good faith.

(c ) Subject to the above mentioned possible time for curing defects, the sale andtransfer of title shall be closed not later than fifteen (15) days after the approval and acceptance ofthe title by the Developer as above specified, or after the title defects have been cured, providednotice thereof is given to the parties promptly and further provided that all other conditionsprecedent to closing, including but not limited to those set forth in Section 7.10, have been satisfiedso that the transaction is otherwise ready to close in all regards.

7.06. Petition for Release of Reservation. By execution of this Agreement, theDeveloper as the purchaser of the Subject Property does petition the Agency for an exception orrelease from such sale any interest of the Agency or local government from the reservationrequirements of Section 270.11, Florida Statutes. The justification for such release is that theproperty is to be used for residential purposes in a downtown area of the City pursuant to the termshereof for redevelopment, which reservation as required by Section 270.11, Florida Statutes, wouldsubstantially hinder and impede such planned redevelopment, including obtaining ultimate

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purchaser from the Developer, its successor and assigns, and obtaining of necessary mortgage loansto be used in the redevelopment thereof

7.07. Agency's Obligation to Convey.

At such time as the Agency has received payment in full of the Purchase Price inimmediately available funds as provided in Section 7.08(c) hereof, the Agency shall then convey theSubject Property to the Developer by delivering a special warranty deed, warranting title onlyagainst the lawful claims of persons claiming by through, or under it, but against none other,subject to such conditions and exceptions as are provided for in this Article 7, free and clear of anyand all liens and encumbrances whatsoever.

7.08. Conditions to Closing.(a ) In addition to any conditions set forth elsewhere in this, the obligation of

Agency to convey the Subject Property to the Developer is subject to the following:(1) The Developer has obtained the Project Financing for the Workforce

Housing Elements of the Phase I Project of the Development with a preliminary commitment forfinancing subsequent phases.

(2 ) The Developer has obtained all Permits required for the commencement andcontinuation to completion of construction of Phase I of the Project.

(3 ) The Developer has obtained any and all necessary approvals and/orconsents to the Site Plan required by the Review Board , City of Pensacola or any othergovernmental or regulatory agency having governmental jurisdiction over said property.

(4 ) The City of Pensacola and/or Agency has received a permit from theFlorida Department of Environmental Protection for construction of a stormwater retentionfacility at Admiral Mason Park, which facility may be built in phases and provide stormwaterretention for the Project Site, all of the Co-Development Property and as large a drainage basinas practical in the area.

(5) The Developer and the Agency have entered into an agreement on financingthe design and construction of a wet retention facility at Admiral Mason Park pursuant to anyapplicable permit issued.

(6 ) All matters set forth in Section 2.04 (b)(1-6) have been approved, granted,accepted, satisfied, or otherwise waived by the Developer.(b) In the event any of the conditions precedent to closing set forth herein are

not met, and said conditions cannot be met within a reasonable amount of time, then, in theDeveloper ' s sole discretion , it may waive compliance with any of said conditions and proceed to

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closing, or , terminate this Agreement pursuant to Section 13.05.7.09. Closing.(a ) Notwithstanding Unavoidable Delay, provided all conditions precedent to

Closing in Section 7.06 have been satisfied, Developer shall purchase the Subject Property on orbefore Closing Date. Upon receipt of a request from the Developer to delay the Closing Datebeyond the Closing Date, the Agency may, in its sole discretion, agree to extend the ClosingDate to a date certain, but in no event shall the Closing Date be delayed beyond July 1, 2008,without the consent of the Developer and the Agency.

(b ) If all conditions precedent to closing have been satisfied, waived, or otherwisemet, and if the Developer does not purchase the Subject Property from the Agency by the ClosingDate, including any extensions or delays thereof, then the Agency may terminate this Agreementpursuant to Section 13.05.

7.10. Closing Procedure.(a) At closing, the Agency shall convey to Developer by special warranty deed

title in fee simple to the Subject Property, free and clear of any and all liens, encumbrances,conditions, easements, assessments, restrictions except those permitted in this Agreement or agreedto by the Developer.

(b ) At closing, the Developer will obtain on behalf of the Agency and deliver toth e Agency an endorsement to the title insurance commitment required herein and such furtherinstruments as may be required by the Developer, Developer's counsel or the title company to vestin Developer title to the Subject Property as provided herein, all at Developer's expense.

(c ) The Developer shall pay the balance of the Purchase Price to the Agency inimmediately available funds acceptable to the Agency. Solely for the purpose of this Agreement,Agency agrees that payment by wire transfer or cashier's check or by check drawn on the trustaccount of Developer's counsel shall be acceptable to the Agency as immediately available funds.

(d ) Ad valorem real estate taxes, non-ad valorem assessments and any personalproperty taxes shall be prorated as of the Closing Date, based on application of the preceding year'srates to the latest assessed valuation or statements issued to Agency for the current year'sassessment, if available. Any such taxes, assessments or other charges that become theresponsibility of the Developer shall not be a credit against the Purchase Price.

(e) Agency shall pay for all documentary stamps and transfer taxes, if any, for thespecial warranty deed, its own attorney's fees, and all other closing costs and expenses incurred bythe Agency. The Developer shall pay the fees for recording the special warranty deed, thepremiums for the owner's title insurance policy, its own attorney's fees and any documentarystamps, taxes, recording fees, and other charges pertaining to the acquisition of the Subject Property

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or to the financing of the Project in whole or in part and any instruments providing or securing suchfinancing, excepting only such costs for curing title defects as are undertaken by the Agency whichshall be the Agency's responsibility .

(f ) Closing shall be conducted at a mutually agreed upon location in Pensacola,Florida, or such other location as may be mutually agreed to by the parties.

7.11. Possession.Possession of the Subject Property shall pass to Developer upon delivery of the special

warranty deed by the Agency to the Developer conveying insurable title to the Subject Property asprovided in Section 7.05.

7.12. Condemnation.In the event that prior to the Closing Date, all or any portion of the Subject Property, or

any rights or easements therein, shall be taken by condemnation or rights of eminent domain or like.process, or shall be threatened therewith, and the same, in the Developer's reasonable opinion,would have a materially adverse impact upon the Developer's contemplated development of theProject Site, the Developer shall, within thirty (30) days after having received notice thereof fromthe Agency, elect in writing to either (a) continue this Agreement in full force and effect,notwithstanding such taking or threatened taking, in which case the Developer shall be required tocontinue the purchase of the Subject Property, (b) delete the portion of the Subject Propertycondemned or threatened to be condemned from this Agreement, with a proportionate reduction inthe Purchase Price, or (c) terminate this Agreement as provided in Section 13.05. Failure of theDeveloper to make a written election within thirty (30) days of receipt of notice ro the Agencyshall constitute an election not to terminate this Agreement. Nothing herein shall bar the Developerfrom continuing with this Agreement and seeking compensation ro the condemning authority forany damages sustained as a result of said condemnation.

7.13. Real Estate Commission.The Developer and the Agency represent that they have not used any real estate broker or

any real estate brokerage services with respect to the transaction herein contemplated. Each partyshall hold the other harmless and indemnify the other party, its respective successors, assigns,employees, directors and agents from any and all costs, damages, liabilities and expenses, includingreasonable attorney's fees, incurred by reason of any claim for fee or commission of any kind basedon the sale of the Subject Property to the Developer by the Agency as contemplated herein.

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ARTICLE S. DEVELOPMENT OF THE PROJECT.8.01. Development of the Project.(a ) The Developer shall develop the Project on the Project Site substantially inaccordance with the Plans and Specifications as approved by the Agency. The parties recognize and

agree that development of the Project will be accomplished through the sale or rental of Units topurchasers or tenants.

(b ) Subject to Unavoidable Delay and the terms and conditions in this Agreement,the Developer covenants and agrees with the Agency that it will exercise its best efforts to causecommencement of construction of the Project to occur within one hundred eighty (180) days afterthe Closing Date. For purposes of this subsection (c), commencement of construction means theissuance of a Building Permit and the initiation of meaningful physical development of the verticalbuilding on that part of the Project as authorized by the Building Permit therefore which is thereaftercontinued and prosecuted with reasonable diligence toward and with the objective of completion ofthat part of the Project within a reasonable period of time.

8.02. Agency Not in Privity with Contractors. The Agency shall not be deemed tobe in privity of contract with any Contractor or provider of goods or services with respect to theconstruction of any part of the Project.

8.03. Workforce Housing.(a)(l) The Agency and the Developer agree that thirty (30) of the total residential

Units in the Project shall be for Workforce Housing.(2 ) The Developer covenants and agrees with the Agency that it will market for

sale or advertise for lease at least thirty (30) of the Workforce Housing residential Units as beingavailable for purchase or lease by a person who is a Qualified Purchaser or Qualified Tenantas those terms are defined below.

(3) If, as a result of market conditions, the Developer is unable to sell one ormore of the thirty (30) Units of Workforce Housing within thirty-six (36) months of receiving acertificate of occupancy for all such Units, and Developer is unable to rent said Units to aQualified 'Tenant during that time, Developer shall reduce the sales price of the Unit(s) by aminimum of ten percent (10%) of the market price of the Unit(s) at the new price to QualifiedPurchaser(s) as defined in (b)(1) below for a period of up to six (6) months and further reduce thesales price in minimum ten percent (10%) increments (except as provided below) for amaximum six (6) month period until said Unit(s) are sold to Qualified Purchasers. Nothingherein shall require the reduction in purchase price of Unit(s) beyond a total of twenty-fivepercent (25%) of the original market price of the Unit(s). Furthermore, nothing in this paragraphshall be construed as precluding the Developer from reducing the selling price of WorkforceHousing Unit(s) during the thirty-six (36) month period referred to above or from further

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reducing the sales price more than specified in Section 1.01 at any time. The thirty (30) Unit(s)of Workforce Housing shall be sold only to Qualified Purchasers or let to Qualified Tenants.

(b)(1) For Purposes of this Section 8.03, Qualified Purchaser or QualifiedRenter means an individual, married couple or family household whose annual income at thetime of the purchase/renting of the Unit is within the range of eighty percent (80%) and onehundred fifty percent (150%) of median income for the Pensacola market area based on theranges established by the U.S. Department of Housing and Urban Development for the thencurrent year.

(2) To determine if a prospective purchaser of a Unit is a Qualified Purchaseror Qualified Renter for purposes of this Section 8.03, the Developer agrees that any prospectivepurchaser who it believes to be a Qualified Purchaser or Qualified Renter will be referred by theDeveloper to the City 's Housing Department for a determination and certification of being aQualified Purchaser or Qualified Renter.

(3 ) The Agency represents to the Developer that the City has agreed to reviewand certify Qualified Purchasers and Qualified Renters and will notify the Agency of any personor persons it determines to be or not to be a Qualified Purchaser or Qualified Renter. TheAgency will notify the Developer of the results of the review and determine by the City'sHousing Department of any prospective Qualified Purchaser or Qualified Renter.

(4) The Developer agrees to promptly notify the Agency when any person orpersons certified by the City's Housing Department to be a Qualified Purchaser or QualifiedRenter purchases or leases a residential Unit(s).

(c ) The Developer covenants and agrees with the Agency to seek persons whoare Qualified Purchasers and/or Qualified Renters and offer residential Units to them forpurchase or let of any of the Workforce Housing residential Units.

(d ) DELETED8.04. Standards for Quality of Construction, Materials and Finishin =s.(a) The Developer covenants and agrees with the Agency that it will use its best

efforts to assure that each part of the Project shall be constructed substantially in accordance withthe Plans and Specifications approved therefore pursuant to Article 4 hereof, and shall be of aquality generally recognized as standard for projects in the City of a type and character similar tothat part of the Project and the standards set forth in the Gateway Redevelopment DistrictOrdinance.

(b ) The Developer covenants and agrees that such standards for the quality ofconstruction as referred to in subparagraph (a) above will be incorporated into any property ownerassociation covenants and conditions for the Project Site by reference only (but shall not be set forththerein in detail however), which restrictive covenants and conditions shall be recorded in the public

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records of Escambia County, Florida. A copy of such restrictive covenants and conditions, and anyamendments or revisions thereto, shall be provided by the Developer to the Agency prior to theiradoption and recording for review and comment by the Agency staff.

8.05 Project Completion.(a ) Subject to Unavoidable Delay, construction of the Phase I Project shallproceed diligently and uninterrupted from commencement and the Phase I Project shall be

completed within twenty-four (24) months of Closing Date. ( Phase I Completion Date ).Completion of construction of the Phase I Project shall be evidenced by issuance by the City of afinal certificate of occupancy for all improvements comprising the phase. The completion datesmay be extended in the sole discretion of the Agency. If Developer fails to completeconstruction of the Phase I Project as set forth herein, Developer shall be liable to the Agency forpayment of liquidated damages equal to NINE THOUSAND THREE HUNDRED SEVENTY-FIVE AND NO/l00 DOLLARS ($9,375.00) for each month the Phase I Project is not complete.Any such liquidated damage payment shall bear interest from the date such payment is due untilpaid at the rate of interest on judgments in Florida. Said liquidated damage provision shall notaccrue in the event the completion date is extended by the Agency or by some other provision ofthis Agreement.

(b ) Subject to Unavoidable Delay, construction of the Phase 11 Project shallproceed diligently and uninterrupted from commencement and the Phase II Project shall becompleted within thirty-six (36) months of Closing Date. ( Phase II Completion Date ).Completion of construction of the Phase 11 Project shall be evidenced by issuance by the City ofa final certificate of occupancy for all improvements comprising the phase. The completiondates may be extended in the sole discretion of the Agency. If Developer fails to completeconstruction of the Phase II Project as set forth herein, Developer shall be liable to the Agencyfor payment of liquidated damages equal to FIFTEEN TI-IOUSND SIX HUNDRED ANDTWENTY-FIVE AND NO/100 DOLLARS ($15,625.00) for each month the Phase 11 Project isnot complete. Any such liquidated damage payment shall bear interest from the date such paymentis due until paid at the rate of interest on judgments in Florida. Said liquidated damage provisionshall not accrue in the event the completion date is extended by the Agency or by some otherprovision of this Agreement.

(c)(1) Subject to Unavoidable Delay, construction of the Phase III Project shallproceed diligently and uninterrupted from commencement and the Phase III Project shall becompleted within sixty (60) months of Closing Date. ( Phase III Completion Date ). Completionof construction of the Phase III Project shall be evidenced by issuance by the City of a finalcertificate of occupancy for all improvements comprising the phase. The completion dates maybe extended in the sole discretion of the Agency. If Developer fails to complete construction ofthe Phase II Project as set forth herein, Developer shall be liable to the Agency for payment ofliquidated damages equal to FIFTEEN TIIOIJSND SIX HUNDRED AND TWENTY-FIVEAND NO/100 DOLLARS ($15,625.00) for each month the Phase 11 Project is not complete.Any such liquidated damage payment shall bear interest from the date such payment is due untilpaid at the rate of interest on judgments in Florida. Said liquidated damage provision shall not

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accrue in the event the completion date is extended by the Agency or by some other provision ofthis Agreement.

(2) Failure of the Developer to timely make any liquidated damage payment to theAgency contemplated herein shall result in Agency recommending to the City that it withhold theissuance of any certificate of occupancy for the improvements made on the Project Site andcompleted after the December 31St when the payment is due. The Developer acknowledges andagrees that the Agency may make such request and that the City may withhold such certificate ofoccupancy and the City may continue to withhold issuance of such certificate of occupancy until allpayments contemplated by (1) then due and payable have been paid to the Agency and the Agencyacknowledges receipt thereof and so notifies the City. The Developer agrees not to object to theCity withholding the issuance of any certificate of occupancy as contemplated by this section8.05.

(3) The Agency and the Developer acknowledge and agree that the harm to theAgency (and the public) in the event the construction of the various phases of the Project doesnot commence and continue to timely completion is significant, but cannot be calculated.Therefore, the parties hereto have agreed that liquidated damages are appropriate in thesecircumstances. The amount of liquidated damages set forth in this section 8.05 areacknowledged and agreed by the parties to be reasonable and are related to the loss of incrementrevenue to the Agency's redevelopment trust fund if the phases are not timely commenced andcompleted.ARTICLE 9. INSURANCE.

9.01. Insurance Requirements Generally.(a)(1) All insurance shall be obtained from financially responsible insurance

companies either duly authorized under the laws of the State of Florida to do insurance business inthe State of Florida (or subject to legal process in the State of Florida) and shall be issued andcountersigned by duly authorized representatives of such companies for the State of Florida.

(2 ) The insurance coverages and limits shall be evidenced by properly executedcertificates of insurance.

(b)(1) All insurance coverages must be issued as required by law and must beendorsed, where necessary, to comply with the minimum requirements contained herein.

(2 ) Renewal certificates of insurance which conform in every respect with therequirements of this Article 9 are to be provided the Agency prior to expiration of current coveragesprovided that if the renewal certificates are not available prior to the expiration date of currentcoverages and renewal coverages have been obtained, the Developer will notify the Agency of theidentity of the renewal insurance carriers no later than 5:00 p.m. (Pensacola time) on the date ofexpiration of the then current coverage.

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(3) The Developer shall cause to be provided to the Agency certified true copiesof any insurance policy required by this Article 9 upon written request of the Agency.

(c ) Construction of the Project, or any part thereof, by the Developer, or anyoneon behalf of the Developer, shall not commence or continue at or on the Project Site unless and untilthe insurance coverage required of the Developer or its Contractors is in effect and satisfactoryevidence of such insurance has been provided to the Agency.

(d ) Nothing in this Agreement is intended or shall be deemed to be designed bythe Agency as a recommended insurance program for the Developer.

(e ) The Developer alone shall be responsible for the sufficiency of its owninsurance program. The Agency will in no way be responsible to the Developer or any other partyfor any inadequacy of the Developer's overall insurance program.

9.02. Insurance During Construction of the -Project.Prior to the commencement of construction and installation of the Project and continuing

until the Project Completion Date, except as otherwise expressly set forth herein, the Developershall provide, pay for and keep in full force and effect, or cause to be provided, paid for and kept infull force and effect, with insurance companies satisfying the requirements of Section 9.01(a), thetypes and amounts of insurance established and determined by the City's Department of RiskManagement.

9.03. Waiver of Subrogation Requirement. The Developer or its Contractor, withrespect to construction of the Project, shall cause its insurance carriers to agree to a joint waiver ofsubrogation with respect to builders risk insurance covering said construction, which waivers shallinclude the Contractors and all subordinate contractors. The Developer shall furnish to the Agencya certified true copy of its respective builders risk insurance policy with copies of all endorsementsadded during the policy term.

9.04. Insurance Exclusive of Indemnity. The insurance obligations of theDeveloper and the Agency specified in this Article 9 are exclusive of, and in addition to, any and allindemnity obligations of the Developer and the Agency under this Agreement.

9.05. No Waiver of Sovereign Immunity. Nothing in this Article 9 is intended orshall be deemed to constitute a waiver in whole or in part of any sovereign immunity applicable toand that may be asserted by the City or the Agency.

9.06. Employees; Motor Vehicles. The Developer has represented to the Agencythat it does not have and does not expect to have any employees or motor vehicles. However,should the Developer have employees or motor vehicles at any time after the Agreement EffectiveDate, then the Developer agrees to obtain and maintain workers compensation and motor vehicleliability insurance in policy amounts to at least the minimum required by law.

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ARTICLE 10. INDEMNIFICATION.10.01. Indemnification by the Developer.(a) For consideration of $10.00 and other good and valuable consideration herein

provided, the receipt of which is hereby acknowledged by the Developer, the Developer agrees toindemnify, defend and hold harmless, the Agency, its respective agents, officers, or employees, andthe City, its respective agents, officers or employees, from any and all liabilities, damages, penalties,judgments, claims, demands, costs, losses, expenses or attorneys' fees through appellateproceedings, for personal injury, bodily injury, death or property damage arising out of, or by reasonof any act or omission of the Developer, its agents, employees (if any) or contractors arising out of,in connection with or by reason of, the performance of any and all services contemplated by thisAgreement, or which are alleged to have arisen out of, in connection with or by reason of, theperformance of any and all services contemplated by this Agreement, or which are alleged to havearisen out of, in connection with, or by reason of, the performance of such services; provided,however, that the Developer shall not be required to indemnify, defend and hold harmless, theAgency, its respective agents, officers, or employees, and the City, its respective agents, officers oremployees, beyond the amount of any insurance carried by, on behalf of, or available to Developer.

(b ) The Developer s indemnity obligations under subsection (a) shall survive theearlier of the T ermination Date or the Expiration Date, but shall apply only to occu rrences acts, oromissions that arise on or before the earlier of the T ermination Date or the Expiration Date.

(c) The Developer's indemnity hereunder is not and shall not be interpreted as aninsuring agreement between or among the parties to this Agreement, nor as a waiver of sovereignimmunity for any party entitled to assert the defense of sovereign immunity.

10.02. Indemnification by the Agency.(a ) To the extent permitted by law, specifically including Section 768.28, Florida

Statutes, and any insurance coverage available to the Agency, the Agency agrees to indemnify,defend and hold harmless, the Developer, its respective, officers, and employees from any and allliabilities, damages, penalties, judgments, claims, demands, costs, losses, expenses or attorneys' feesthrough appellate proceedings, for personal injury, bodily injury, death or property damage arisingout of, or by reason of, any act or omission of the Agency, its respective agents or employees arisingout of, in connection with or by reason of, the performance of any and all services contemplated bythis Agreement, or which are alleged to have arisen out of, in connection with or by reason of, theperformance of any and all services contemplated by this Agreement.

(b ) The Agency shall indemnify, defend and hold harmless the Developer, itsofficers and employees from any and all liabilities, damages, costs, penalties, judgments, claims,demands, losses, or expenses (including, but not limited to, actual attorneys' fees and fees of ProjectProfessionals) arising from or attributable to any breach by the Agency, as the case may be, of anyrepresentations or warranties contained in Section 12.01, or covenants contained in Section 12.02.

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(c ) The Agency's indemnity obligations under this Section 10.02 shall survive theearlier of the Termination Date or the Expiration Date, but shall only apply to occurrences, acts oromissions that arise on or before the earlier of the Termination Date or the Expiration Date. TheAgency's indemnity hereunder is not and shall not be interpreted as an insuring agreement betweenor among the parties to this Agreement, but is in addition to and not limited by any insurance policyprovided that said obligation shall not he greater than that permitted and shall be limited by theprovisions of Section 768.28, Florida Statutes, or any successor statute thereto.

10,03. Limitation of Indemnification.Notwithstanding anything to the contrary contained herein, with respect to the

indemnification obligations of the Developer (as set forth in Section 10.01) and the Agency (as setforth in Section 10.02), the following shall apply:

(a ) the indemnifying party shall not be responsible for damages that could havebeen, but were not, mitigated by the indemnified party;

(b ) the indemnifying party shall not be responsible for that portion of anydamages caused by the negligent or willful acts or omissions of the indemnified party; and

(c ) there shall be no obligation to indemnify hereunder in the event that theindemnified party (1) shall have effected a settlement of any claim without the prior written consentof the indemnifying party, or (2) shall not have subrogated the indemnifying party to theindemnified party's rights against any third party by an assignment to the indemnifying party of anycause or action against such third party.

ARTICLE 11. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THEDEVELOPER.11.01. Representations and Warranties. The Developer represents and warrants to

the Agency that each of the following statements is currently true and accurate and agrees theAgency may rely upon each of the following statements:

(a ) The Developer is a Florida for profit corporation duly organized and validlyexisting under the laws of the State of Florida, has all requisite power and authority to carry on itsbusiness as now conducted, to own or hold its properties and to enter into and perform itsobligations hereunder and under each document or instrument contemplated by this Agreement towhich it is or will be a party, is qualified to do business in the State of Florida, and has consented toservice of process upon a designated agent for service of process in the State of Florida.

(b ) This Agreement and, to the extent such documents presently exist in formaccepted by the Agency and the Developer, each document contemplated or required by thisAgreement to which Developer is or will be a party have been duly authorized by all necessaryaction on the part of, and have been or will be duly executed and delivered by, the Developer, and

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neither the execution and delivery thereof, nor compliance with the terms and provisions thereof orhereof: (1) requires the approval and consent of any other party, except such as have been dulyobtained or as are specifically noted herein, (2) contravenes any existing law, judgment,governmental rule, regulation or order applicable to or binding on the Developer, (3) contravenes orresults in any breach of, default under or, other than as contemplated by this Agreement, results inthe creation of any lien or encumbrance upon any property of the Developer under any indenture,mortgage, deed of trust, bank loan or credit agreement, the Developer's articles of incorporation, or,any other agreement or instrument to which the Developer is a party or by which the Developer maybe bound.

(c ) This Agreement and, to the extent such documents presently exist in formaccepted by the Agency and the Developer, each document contemplated or required by thisAgreement to which the Developer is or will be a party constitutes, or when entered into willconstitute, a legal, valid and binding obligation of the Developer enforceable against the Developerin accordance with the terms thereof, except as such enforceability may be limited by applicablebankruptcy, insolvency or similar laws from time to time in effect which affect creditors' rightsgenerally and subject to usual equitable principles in the event that equitable remedies are involved.

(d ) There are no pending or, to the knowledge of the Developer, threatenedactions or proceedings before any court or administrative agency against the Developer, or againstany officer, employee or agent of the Developer, which question the validity of this Agreement orany document contemplated hereunder, or which are likely in any case, or in the aggregate, tomaterially adversely affect the consummation of the transactions contemplated hereunder or thefinancial condition of the Developer.

(e ) The Developer has filed or caused to be filed all federal, state, local andforeign tax returns, if any, which were required to be filed by the Developer, and has paid, or causedto be paid, all taxes shown to be due and payable on such returns or on any assessments leviedagainst the Developer.

(f) All financial information and other documentation, including that pertaining tothe Project or the Developer, delivered by the Developer to the City and the Agency, was, on thedate of delivery thereof, true and correct.

(g) The principal place of business and principal executive offices of theDeveloper are in Pensacola, Florida, and the Developer will keep original or duplicate recordsconcerning the Project (such as construction contracts, financing documents and corporatedocuments) and all contracts, licenses and similar rights relating thereto at an office in the City.

(h ) As of the Closing Date, the