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ATTY/AGR/2016.125/RWC-YMCA EXCLUSIVE NEGOTIATING AGREEMENT <br />REV: 06-20-16 VR <br />Page 6 of 12 <br /> <br />a. Ground Lease. The Parties will negotiate in good faith a 49-year Ground Lease (plus one, 5- <br />year Lease extensions) for that certain portion of the Property where the YMCA Facilities <br />would be constructed, for annual rent of $1/year. <br /> <br />b. Development Agreement. The Parties will seek to vest the entitlement rights beyond the <br />normal permit period and to set forth specific terms concerning the phased construction of <br />the Project through negotiation and approval of a Development Agreement. <br /> <br />c. Right of Access Agreement. To authorize agents of YMCA-SV to access the Property for the <br />purpose of conducting physical and environmental inspections of the Property in connection <br />with the design development and construction of Project, the Parties intend to negotiate a <br />Right of Access Agreement. <br /> <br />d. Operating Agreement. The Parties will negotiate an agreement to control the ongoing <br />operation of the Project in the event it is built, with the following general terms: <br /> <br />i. Operational Team. Established to plan and oversee all joint programs and services <br />following the opening of the Project. Tasks might include periodic review of separate <br />accounting for billings associated with CAM expenses including utilities (water, <br />electric and cable), landscaping, parking, security, maintenance, and surveillance, <br />paving, sidewalks; exterior lighting; garbage/recycling. In addition, they would have <br />the responsibility for annual Project performance and facilities review. <br /> <br />ii. Joint marketing and promotional programs. City will include YMCA-SV in its semi- <br />annual City Program Guide and the YMCA-SV will include City events at the Project in <br />YMCA-SV email newsletters. <br /> <br />iii. Endowment Commitment. During the term of the Operating Agreement and Ground <br />Lease, the YMCA-SV would use the proceeds from the sale of the Hudson YMCA <br />(regardless of the purchaser) to fund an endowment fund managed by the YMCA-SV, <br />whose interest earnings that are determined annually by the YMCA-SV Board of <br />Directors would be used to fund operational costs and financial assistance for <br />qualified low-income children, adults and families. <br /> <br />iv. General Provisions re: possible future operations. As summarized in Exhibit B, hereto. <br /> <br />e. Right of First Offer. The Parties will negotiate a right of first offer to purchase the existing <br />YMCA-SV facilities located at 1445 Hudson Street, Redwood City (“Hudson YMCA”). The <br />Parties will negotiate the process to establish the sales price, timing and other salient terms, <br />to be memorialized in a definitive agreement. In the event the Parties are unable to agree on <br />a price for the site, the YMCA-SV would be free to accept an alternative purchase <br />offer and proceed with the sale to a 3rd party. <br /> <br /> <br />6.1.B. - Page 10