City of Brentwood
Home PageContact Us!Back

City Administration

2010 Council Goals and Strategic Plan | City Council Members | Calendar of Events | Elections
eNotification | Sub-Committees| Pledge of Allegiance Sign Ups | Invocation Sign Up
Live Streaming Council Meeting | Streaming PC Help |
Streaming Mac Help |

Current Council Agenda and Past Meeting Information

CITY COUNCIL AGENDA ITEM NO. 22

Meeting Date: December 9, 2008

Subject/Title: Adopt a Resolution approving and authorizing City Manager or her designee to execute Amendment No. 5 to Purchase Agreement with Pizzagoni Family, Inc., for an Extension of the City’s Option to Repurchase period by 180 days from issuance of Building Permits for site at Sunset Industrial Complex and for a reduction by 180 days for issuance of a Certificate of Occupancy, and directing staff to take actions and authorizing the City Manager to execute documents necessary for the amendment.

Prepared by: Gina Rozenski, Redevelopment Manager

Submitted by: Casey McCann, Director of Community Development

RECOMMENDATION
Adopt a Resolution approving and authorizing City Manager or her designee to execute Amendment No. 5 to Purchase Agreement with Pizzagoni Family, Inc., for an Extension of the City’s Option to Repurchase period by 180 days from issuance of Building Permits for site at Sunset Industrial Complex and for a reduction by 180 days for issuance of a Certificate of Occupancy, and directing staff to take actions and authorizing the City Manager to execute documents necessary for the amendment.

PREVIOUS ACTION
• On September 14, 2004, the City Council authorized the City Manager to execute a Purchase Agreement for the sale of Lot 22 to Pizzagoni Family, Inc., with escrow to close no later than January 14, 2005.

• On January 24, 2006, the City Council authorized the City Manager to execute Amendment No. 1 to the Purchase Agreement with Pizzagoni Family, Inc. to extend escrow to May 1, 2006.

• On May 23, 2006, the City Council authorized the City Manager to execute Amendment No. 2 to the Purchase Agreement with Pizzagoni Towing to extend escrow to September 30, 2006.

• On September 26, 2006, the City Council authorized the City Manger to execute Amendment No. 3 to the Purchase Agreement with Pizzagoni Family, Inc. to extend escrow to December 15, 2006.

• On January 9, 2007, the City Council authorized the City Manager to execute Amendment No. 4 to the Purchase Agreement with Pizzagoni Family, Inc. to extend escrow to February 15, 2007.

• Escrow closed on May 3, 2007.

BACKGROUND
Amendments 1 through 4 were necessary to provide Pizzagoni time to close escrow due to delays in design review approvals, civil engineering and architect drawings, construction bids, and provision of evidence of mortgage and equity financing from Pizzagoni’s lender.
The Purchase Agreements between the City and buyers at Sunset Industrial Complex include a provision (Section 3.01) that allows the City the right, at its option, to repurchase the site if the purchaser fails to obtain building permits for construction of the proposed business operation within eighteen (18) months after the escrow closing date. The Purchase Agreement further provides the City the right, at its option, to repurchase the site if the purchase fails to obtain a certificate of completion within eighteen (18) months after issuance of building permits. The expiration of the eighteen (18) month period to pull permits by Pizzagoni was November 3, 2008.
Pizzagoni is currently working to revise construction bids and obtain construction financing and is requesting a six (6) month extension to pull building permits. Pizzagoni is a prime example of the type of business that the City envisioned for Sunset Industrial Complex, in addition to voluntarily relocating their primary business from Brentwood Boulevard.
Staff recommends the Council approve Amendment No. 5 to extend the original 18 month period to pull building permits by 180 days (6 months) for Pizzagoni, and direct staff to take actions and authorize the City Manager to execute documents necessary to memorialize the extension. This would allow Pizzagoni until May 3, 2009 to pull their building permits. Staff further recommends that the 18 month period for the certificate of occupancy be reduced by 180 days (6 months); thereby allowing 12 months from the building permit issuance to construction completion, keeping the development of this site on course with the Purchase Agreement. Pizzagoni has agreed to this condition.

FISCAL IMPACT
None at this time.

Attachments:
Resolution
Amendment No. 5

RESOLUTION NO.

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF BRENTWOOD APPROVING A FIFTH AMENDMENT TO THE PURCHASE AGREEMENT FOR SUNSET INDUSTRIAL COMPLEX WITH PIZZAGONI FAMILY, INC. FOR AN EXTENSION OF THE CITY’S OPTION TO REPURCHASE PERIOD BY 180 DAYS FROM ISSUANCE OF BUILDING PERMITS FOR SITE AT SUNSET INDUSTRIAL COMPLEX AND FOR A REDUCTION BY 180 DAYS FOR ISSUANCE OF A CERTIFICATE OF OCCUPANCY, AND DIRECTING STAFF TO TAKE ACTIONS AND AUTHORIZING THE CITY MANAGER TO EXECUTE DOCUMENTS NECESSARY FOR THE AMENDMENT.

WHEREAS, on September 14, 2004, the City Council authorized the City Manager to execute the Purchase Agreement with Pizzagoni Family, Inc. (“Pizzagoni”). The Purchase Agreement was executed on October 12, 2004; and

WHEREAS, on January 24, 2006, the City Council approved Amendment No. 1 to the Purchase Agreement with Pizzagoni to extend the escrow to May 1, 2006; and

WHEREAS, on May 23, 2006, the City Council approved Amendment No. 2 to the Purchase Agreement with Pizzagoni to extend the escrow to September 30, 2006; and

WHEREAS, on September 26, 2006, the City Council approved Amendment No. 3 to the Purchase Agreement with Pizzagoni to extend the escrow to December 15, 2006; and

WHEREAS, on January 9, 2007, the City Council approved Amendment No. 4 to the Purchase Agreement with Pizzagoni to extend the escrow to February 15, 2007; and

WHEREAS, on May 3, 2007, escrow closed with Pizzagoni for 3.7 acres known as 2175 Elkins Way at Sunset Industrial Complex; and

WHEREAS, the Purchase Agreement includes Section 2.06 that states the purchaser shall obtain building permits from the City for the construction or development of any buildings, structures or other work of improvements upon the Site within eighteen (18) months after the close of escrow; and

WHEREAS, the Purchase Agreement includes Section 2.08 that states the purchaser shall request and obtain a certificate of occupancy from the City of Brentwood within eighteen (18) months from City’s issuance of building permits for the construction or development of any buildings, structures or other work of improvement upon the Site; and

WHEREAS, the Purchase Agreement includes Section 3.01 that allows the City the right, at its option, to repurchase the site if the purchaser fails to comply with Section 2.06 and Section 2.08; and

WHEREAS, the Purchase Agreements includes Section 19 that allows the Purchase Agreements to be amended only by written instrument executed by City and Purchaser; and

WHEREAS, the City and Pizzagoni have made good faith efforts to comply with their respective obligations as provided in the Purchase Agreements, and each desire to extend the City’s Option to Repurchase period for this transaction; and

WHEREAS, the City and Pizzagoni Family, Inc. desire to amend Section 2.06 to extend the time period for the issuance of a building permit by 180 days, amend Section 2.08 to reduce the time period for the issuance of a certificate of occupancy by 180 days, and amend Section 3.01 accordingly; and

NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Brentwood hereby approves and authorizes the City Manager or her designee to execute the fifth amendment to the purchase agreement for Sunset Industrial Complex with Pizzagoni Family, Inc. for an extension of the City’s Option to Repurchase period by 180 days from issuance of building permits for site at Sunset Industrial Complex and for a reduction by 180 days for issuance of a Certificate of Occupancy, and directs staff to take actions and authorizes the City Manager to execute documents necessary for the amendment.

PASSED, APPROVED AND ADOPTED by the City Council of the City of Brentwood at a regular meeting held on the 9th day of December 2008 by the following vote:


Amendment No. 5 to Purchase Agreement and City’s Option to Repurchase
(Pizzagoni Family, Inc.)

This Amendment No. 5 is entered into and effective as of the ____ day of ___________ 2008, amending the Purchase Agreement and City’s Option to Repurchase dated October 12, 2004 (the “Agreement”) by and between the City of Brentwood, a municipal corporation, (“City”), and Pizzagoni Family, Inc. (“Purchaser”) (collectively, the “Parties”) for the purchase and option to repurchase certain real property (the “Property”) situated in the City of Brentwood.

Recitals

A. The Parties amended the Agreement by executing Amendment No. 1 on January 24, 2006, to extend the period of time in which to close escrow on the Property to May 1, 2006.

B. The Parties amended the Agreement a second time by executing Amendment No. 2 on May 23, 2006, to extend the period of time in which to close escrow on the Property to September 30, 2006.

C. The Parties amended the Agreement a third time by executing Amendment No. 3 on September 26, 2006, to extend the period of time in which to close escrow on the Property to December 15, 2006.

D. The Parties amended the Agreement a fourth time by executing Amendment No. 4 on January 9, 2007, to extend the period of time in which to close escrow to February 15, 2007.

E. The Parties desire to amend the Agreement a fifth time to extend the amount of time to obtain building permits by six (6) months and to reduce the amount of time required to obtain a certificate of occupancy by six (6) months.

F. City and Purchaser have made good faith efforts to comply with their respective obligations as provided in the Agreement, as amended.

G. The Parties have reached agreement on specific language for the amendment and desire to memorialize it herein.

Now, therefore it is agreed as follows:

1. That the third paragraph of Section 2.06 of the P Agreement is hereby amended in its entirety to read as follows:

The Purchaser shall obtain building permits from the City for the construction or development of any buildings, structures or other work of improvements upon the Site within twenty-four (24) months after the Closing Date. Failure to obtain a building permit within twenty-four (24) months after the Closing Date shall trigger the City’s option to repurchase the Site. A reasonable extension of time may be granted by the City to Purchase if Purchaser has submitted an application to another governmental agency other than the City that is required to issue a permit for the proposed Business Operation on the Site and Purchaser has submitted all required information and the governmental agency has not issued a required permit.

2. That the first paragraph of Section 2.08 of the Agreement is hereby amended in its entirety to read as follows:

2.08 Certificate of Completion. The Purchaser shall request and obtain a Certificate of Occupancy (“Certificate”) from the City within twelve (12) months from City’s issuance of building permits for the construction or development of any buildings, structures or other work of improvement upon the Site. Failure to request and obtain a Certificate within twelve (12) months from City’s issuance of building permits for the Site shall trigger the City’s option to repurchase the Site. Should a multi-phased development be approved by the City during the Site’s entitlement process, a Certificate from the City for the first phase of a multi-phased development of the Business Operation on the Site will satisfy this requirement. A certificate from the City shall be a conclusive determination of satisfactory completion of construction as required by this Purchase Agreement upon the Site or the applicable portion thereof and full compliance with the terms hereof as to the Site or applicable portion thereof.

3. That Sections 3.01 (a) and (b) of the Agreement are hereby amended in their entirety to read as follows:

a. Purchaser fails to obtain building permits from the City for the construction of the improvements on the Site within twenty-four (24) months after the Closing Date, pursuant to Section 2.06 herein, without prior written consent for a reasonable extension of time granted by the City;

b. Purchaser fails to obtain a Certificate from the City for the completion of the improvements on the Site within twelve (12) months from City’s issuance of building permits for said improvements, pursuant to Section 2.08 herein, without prior written consent for a reasonable extension of time granted by the City; or

4. Except as amended herein, all other provision of the Agreement, as amended, will remain in full force and effect.

5. The individuals executing this Amendment No. 5 and the instruments referenced in it on behalf of Purchaser represent and warrant that they have the legal power, right and actual authority to bind Purchaser to the terms and conditions of this Amendment No. 5.

IN WITNESS WHEREOF, the parties hereto have caused Amendment No. 5 to be executed by their respective representatives thereunto duly authorized.

CITY OF BRENTWOOD PURCHASER:
PIZZAGONI FAMILY, INC.

Donna Landeros, City Manager
Kristina Reynolds

ATTEST:

Margaret Wimberly, City Clerk

APPROVED AS TO FORM:

Damien B. Brower, City Attorney
 
City Administration
City of Brentwood City Council
150 City Park Way
Brentwood, CA 94513
(925) 516-5440
Fax (925) 516-5441
E-mail allcouncil@brentwoodca.gov