HomeMy WebLinkAbout1988-09-26 88-407 ORDERt,ouncin}nr
Dale "y^2i l88 orr ` Item No. - 88-407
nem/8 blecPAuthorizang Execution of Option Agreement with Gridley
Street Associates - Parcels H-2 and H-3
Responsible Department: Community Development
Commentary:
34e mmnuLLty cevelopnent Committee met can Moday, September 19, 1988 and
recommended approval of the enclosed Council. Order. 'this has been quite a
long project xequiring extensive'negotiatices and preparation work by the -
Developer end City staff. All of the pieces appear to be in place at this
time and the details of the Option Agreement appear to be in place and
acceptable to all coxernen parties. As of the date of this Memorandum two
outstanding issues include the earnest of the morthly option fee and the
performance and materials bad requirements. City staff is recrinamanding
that the monthly option fee remain as stated in: the version of the Option
Agreement Mich is"before you. this amountis calculated in aobrdance with
Council Order y88-172 and is the equivalent of cane-half of 18 of the
pertbase
estimated price for -the pit ,parcels. Rhe •to he a m would' like the
block on be lowered, but this; does not appear to addressed a ease[ stumblh s
block in our oper at the . .lbs bed infirm Onto be i,Ulislcysr d: staff
and the Develops[.,"at but
Council meeting. may
Onto again, this does-nM appear
fo he major issue .but discussion mag be'regardin and t Inds o ar[hMile
for gun Counciwill
a"pilicy,dedisim regarding in Ug Mat kinds of assurances
arc] guarantees will be Yegmitral of developers in Ne:futmue.-
L �p' pepertmf Hevd
Manager Comments:
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.455O<Iat[E Information:Q
Bu d9et Approval: alf,
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renal Approval:
A..CiOrSulleim:
I n—broduced For
LJ Passage
First Reading - Page_ of
0 Referral
88-40]
AmipMto Councilor Shubert, September 26, 1988
CITY OF BANGOR
(TITLE.) Mrbtry.....AutbPLlzing...F sgdtlm of option..A rsemsnt with. crraley ,.
street Associates -- Parcels H-2 and H-3
By the City Coamptt of Me City ofRanpor.
ORDERED,
THAT the city Manager is hereby authorized and directed, on behalf
of the City of Bangor, to execute an Optim Agreement, a copy of whicb is on
file in the Office of the City Clerk, with Gridley Street Associates for the
purchase and redevelopment of property known as Urban Penewal Parcels H-2
aM H-3.
88-407
ORDER
Title,
- A�tliorizing `EaxuSiov: & ia-.:A reemnt
with gridley street associates Parcels H-2 H-3
Passed
council 9eptcmber.2 1988
PaPascal ......................................
M �
AuipmJ W
w�
Ci y Clerk �Q�md b/
Comcilman.
Date October 6, 1998
TO:
Edward A.
Barrett,
City Manager
FR h
Matthew B.
Nichols,
Asst City Solicitor
BE; Option Agreement for Parcels H -d 6 H-3
Please initial the change on page 6 of bath of these
originals. The change is required due to a typographical error
which occurred during one of our many revisions to the Agreement.
The msing word "amount" wag discovered by Andy Hamilton and
during the phone conversation with Andy, I advised him to have
his client insert the change and initial it (see "gg" on page 6
for George Gillis).
Afteryou have initialed the change, please forward
one original to the City Clerk's office for their records, and
forward the other original to the Community Development office.
M.B.N.
to
Enclosures
cc: Rodney G. McKay, Director of
Planning S Community Development I1
K „✓
OPTION AGREEMENT FOR PURCHASE OF
URBAN RENEWAL PARCEL H-2 6 H-3
THIS AGREEMENT is made this iwj day of n4iw , 1988,
by and between the CITY OF BANGOR, a municipal corporation located in
the County of Penobscot, State of Maine (hereinafter "CITY"), and
Gridley Street Associates, a Maine General Partnership, having a place
of business in Bangor, County of Penobscot, State of Maine
(hereinafter "DEVELOPER" which term shall also include any wholly
owned subsidiary corporation orany corporation, partnership, limited
partnership or trust where the shares, partnership interests or legal
or beneficial interests are held by the shareholders of DEVELOPER).
WITNESSETH:
WHEREAS, the CITY has received the DEVELOPER'S proposal for the
development of the real property known as Renduskeag Stream Urban
Renewal Disposition Parcel R-2 a H-3, located on Boyd Street in Bangor
(hereinafter "the Premises"), being approximately 90,533 square feet,
and being more particularly identified on Exhibit A attached hereto
and incorporated herein by reference; and
WHEREAS, in accordance with its Development. Plan, the CITY has
determined that the private development of the Premises in accordance
with the provisions of this Option Agreement and the Development Plan
would best serve the interests of the citizens of the CITY; and
WHEREAS, the CITY has determined that the DEVELOPER'S proposal
will serve the interests of the citizens of Bangor;
NOW, THEREFORE, in consideration of the option fee paid to the
CITY by the DEVELOPER in accordance .with Section A.Z. below and of the
mutual conditions and covenants contained herein, the parties agree as
follows:
Section A. GRANT OF OPTION
1. Grant of Option. The CITY grants and the DEVELOPER accepts
an exclusive option to purchase the Premises for development of not
less than 32 dwelling units containing not less than 64,000 square
feet of floor area at a m direct construction cost (fees foe
architects, engineering andrsurveVs plus sit¢ work, building labor and
materials, and tenant improvements) of not less than Ona Million Eight
Hundred Thousand Dollars ($1,800,000) in accordance with the terms and
conditions of this Option Agreement. The purchase price of the
Premises shall be $88,503.00, to be paid to the CITY in cash or by
Certified or Bank Check at the time of closing on the sale of the
Premises, less any amounts paid by the DEVELOPER to the CITY pursuant
to this Option Agreement.
2. Term and Price of Option. This Option Agreement shall
remain in effect from the date hereof until April 1, 1989. The non-
refundable option fee for this period is $425.00 per month, which
shall be pale to the CITY in cash or by Certified or Bank Check on or
before the first business day of each month this Option Agreement is
in effect beginning October 1, 1988.
The City Council may extend this Option Agreement, upon the
DEVELOPER'S written request stating the reasons therefor, for a period
not to exceed an additional six (6) months. The fee for an extension,
which shall be payable in full, before or at the time the extension is
executed, shall be $ 425.00 per month.
All option fees paid to the CITY under this Agreement shall
be applied towards the purchase price upon the conveyance of the
Premises to the DEVELOPER; provided, however, that the option fees
shall be -forfeited to the CITY if the DEVELOPER does not purchase the
Premises in accordance with the terms and conditions of this Agree-
ment.
3. Exercise of Option. To exercise its right to purchase the
Premises, the DEVELOPER shall so notify the CITY in writing before the
expiration of this Option Agreement and any extension thereof.
4. fore lance and Evidence of Title. Within 30 days, orsuch
other time as Heparties may agree upon, o the CITY'S receipt of the
DEVELOPER'S notice under Section A.3. above, the CITY shall c vey the
Premises, including the areas formerly known as Frazier Street,
Gridley Street, and Church Lane included therein, conveying good and
clear marketable title, free and clear of all liens and encumbrances,
except easements for existing sewer lines as shown on Exhibit •A•, or
as such sewer lines may be relocated by the DEVELOPER, to the Premises
to the DEVELOPER by Municipal Quitclaim Deed, subject however to the
conditions, restrictions, and covenants contained in Sections E. and
C. below. Within 30 days of the date of this Option Agreement, o
such other time as the parties may agree, the CITY will furnish to the
DEVELOPER evidence of its title in the form of an abstract of title
prepared in accordance with the Maine Title Standards, or a title
insurance co mmitment issued by a title insurance company, licensed to
do businessin the State of Maine, that it will issue a title
insurance policy insuring marketable title. If the CITY is unable to
tender marketable title after using such reasonable efforts, the CITY
shall refund to the DEVELOPER the fees paid under this Option
Agreement, if the DEVELOPER so requests, or the DEVELOPER may choose
to accept the CITY'S Municipal Quitclaim Deed, in which case the
DEVELOPER shall assume any risks associated with the title. The
status of title disclosed by such abstracts or title insurance binder
must meet the approval of the DEVELOPER'S attorneys; such approval
shall not be unreasonably withheld. In no event shall the CITY'S
obligations to tender marketable title, and to use reasonable efforts
to determine the source of title, extend beyond the term of this
Option and any duly executed extension thereof as set forth in Section
A.2. above.
5. Right of Entry. During the option period the DEVELOPER
shall have the right, on reasonable notice to and consent by the City
Engineer, to enter upon the Premises with persons and machines for the
preparation of feasibility studies and construction plans. Such entry
shall be at DEVELOPER'S sole risk and expense, and the DEVELOPER
covenants and agrees to indemnify, defend, and hold the CITY harmless
from any claims for personal injury or property damage suffered by
reason of entry upon the Premises by DEVELOPER, its agents or employ-
ees, or anyone acting on the DEVELOPER'S behalf. Prior to any entry
hereunder, the DEVELOPER shall first obtain liability insurance or
other acceptable coverage for liability for this purpose in such
amount(s) of coverage satisfactory to CITY with the CITY as a
additional named insured, and shall provide the CITY with written
evidence thereof. All work shall be done in a manner us
that causes the
least possible disturbance t0 the Premises, and the DEVELOPER
covenants and agrees that the exercise of its rights under this
paragraph shall be done in a workmanlike manner and that DEVELOPER
shall repair any damage to the Premises resulting from the exercise of
these rights.
6. Site Improvements. The City hereby agrees to remove all dead
and/or diseased trees from the Premises prior to conveyance of the
Premise to DEVELOPER.
Section B. CONDITIONS PRECEDENT TO THE CITY'S CONVEYANCE OF THE
PREMISES TO THE DEVELOPER
Before the CITY'S conveyance of the Premises the DEVELOPER shall
complete the following:
1. Submission of Plans. The development and use of the
Premises as incorporated the DEVELOPER'S final plan shall be i
substantial conformance with the scope of development described i
Section A.1. above and the DEVELOPER'S presentation to the CITY o
Jud, 1988, and plana entitled "Pros
poed 32 Apt. Units", prepared
by Webster/Bald win/Rohm an/Dav/Csarnreck L,
P.A., dated July 19, 1988,
copies of which plans are on file in the office of the Department of
Planning and Community . Development, City Hall, 73 Harlow Street,
Bangor, Maine.
Any development and use of the Premises shall comply with
the Codes and Ordinances of the City of Bangor.
All terms used in this paragraph shall be -defined in
accordance with the provisions of the Zoning Ordinance of the City of
Bangor and any applicable amendments thereto or replacements thereof.
Plans shall conform to and be submitted in accordance with the pro-
visions of subsection 2. below.
2. Approval of Plans. No construction or renovation will be
allowed without the prior submission and approval of preliminary
plans, final plans, and specifications. All plans will be submitted
to the city Manager or staff designated by the City Manager. All
plane and revisions to plans shall be reviewed by City staff desig-
nated by the City Manager after which the City Manager shall submit
the plans along with his recommendations to the City Council. Said
plana shall be reviewed and approved by the City Council. No plans
shall be approved unless said plans have been prepared by a duly
registered architect or a duly registered professional engineer, as
each is defined by Title 32 of the Maine Revised Statutes Annotated,
unless otherwise accepted by the City. The following submissions
shall be required:
a. Preliminary Plan - The intent of the Preliminary Plan
shall be to outline the general scope of development
or redevelopment, and to convey to the City Council
sufficient information to determine the character of
the work to be performed. The Preliminary Plan shall
contain:
(1) Site Plan - The site plan shall be drawn to a
scale of one (1) inch equals twenty (20) feet
.wherever practical. The plan should include:
(a) Property lines and dimensions.
(b) Adjacent features, such as abutting
streets, buildings or properties.
(C) existing and proposed paved areas,
including the type of pavement an
principal dimensions.
(d) The on-site parking layout, and traffic
flow, if any.
(e) Planting aaincluding general sive
and variety of trees and shrubs.
(f) All existing and proposed utilities, both
above and below ground, including ser-
vice connections and drainage facilities.
(g) Principal elevations, grades, or con-
tours,
on-tours, both existing and proposed.
(h) existing and new building outlines,
including overlaps such as canopies or
basement extensions.
(2) Floor Plan - The scale of the floor plan shall
he left to the discretion of the architect.
This plan shall show general room layouts and
including entrances and exits. Dimensions
may be approximate and the overall floor area
for each floor shall be indicated. The
elevation of each floor shall be indicated.
(3) Elevations - A suitable cross-section or
elevation of the building shall be provided,
either in the form of an artist's rendering of
the building or a cross-section of the
building. Where site grade plays an important
part in the layout of multi-level structures,
the City shall reserve the right to request
cut -away elevations showing the relationship of
floors to surrounding grades. Materials to be
used for exterior treatment shall be indicated.
b. Final Plans and Specification -After approval of
the pralimv na[y plan, the developer shall then
proceed with the preparation of final plans and
specifications. Said plans and specifications shall
Show sufficient details necessary to insure proper
construction. All dimensions and elevations shall be
accurate and all materials to be used in the
structural or architectural treatment of the facility
shall be outlined in complete detail. If, in the
opinion of the City, there is a doubt regarding the
structural adequacy of any facility, the developer
shall provide all required back-up data, including
structural computations, boring logs or material
guarantees.
C. No later than December 1, 1988, the DEVELOPER shall
set with the CityTity Councvl and submit for its
approval preliminary plans as specified in Section
B.2. above. If the City Council deems revisions to
the preliminary plans to be necessary or appropriate,
the plana must be so revised and submitted to the
City Council for its approval no later than Jan. 1,
1989.
No later than March1, 1989, the DEVELOPER shall meet
with the City Council and submit for its approval
final plans and related drawings, specifications, and
documents in the form specified in Section B.2.
above. If the City Council deems revisions to the
final plans to be necessary or appropriate, the plans
must be so revised and submitted to the City Council
for its approval no later than April 1, 1989.
3. Amendment to Final Plans. If the DEVELOPER desires to make
any substantial alterations in the final plans after their approval by
the City Council, the DEVELOPER shall submit the proposed change in
writing to the City Council for its approval. If the final plans, as
modified by the proposed change, still conform to the requirements of
Section R.I. hereof, the City Council shall not unreasonably withhold
approval of the proposed change. The City Council shall either
approve or disapprove the proposed change within ten (10) days after
its submission and notify the DEVELOPER of its decision.
4. ConstruCtionProd rose Schedule. Concuree nt ly with the
submission of the final plans, the DET
E_YtR shall submit a construc-
tion -progress schedule to the City Council for its approval. The
progress schedule shall provide for the commencement of construction
within six (6) months after closing and completion of construction
within twenty-four (24) months from the commencement of construction,
r such later date as the City Council may approve. Nothing herein
shall be construed to extend, limit, or otherwise affect the time
limits prescribed in any building permit or Planning Board approval.
5. Permit Requirement. DEVELOPER shall obtain, and shall
provide satisfactory evidence thereof to the CITY, every permit,
license, and governmental approval necessary for commencement and
completion of the development including, but not limited to, Bangor
Planning Board approval if required.
6. Evidence of %arcing. The DEVELOPER shall provide the
CITY with written, legally bind r ng commitments, in a form satisfactory
to the City Solicitor, from acceptable lending institutions or govern-
mental agencies for both interim construction financing and long -teem
financing of the total proposed development as it is detailed in the
plans referred to and approved under Sections B.1. and B.2. above.
J. Construction Contract. The DEVELOPER shall provide the
CITY with a certificate executed by the DEVELOPER and its general
contractor, if any, for construction of the total development certi-
fying to the existence of such a contract for development i accor-
dance with the provisions of Section B.1., B.2., B.3. and B.14. above.
S. Performance Bond. The DEVELOPER or the DEVELOPER'S general
contractor shall post with the lending institutions or governmental
agencies referenced in Section 6 above both a performance bond and a
labor and materials payment bond issued by corporate surety licensed
todo business in the State of Maine, each in a penial sum equal to
the total estimated cost of the total proposed development, to secure
performance of the obligations set -forth in Sections B.1, B.2, B.3 and
B.4 above. The DEVELOPER Or the DEVELOPER'S general contractor shall
submit to the CITY a copy of said bonds and written evidence of
payment of the required premiums.. The bonds must remain ineffect
until the CITY'S issuance of the Certificate of Completion under
Section C.12. below.
In Lieu of the above referred to labor and materials payment
bond, the DEVELOPER may, at its option, obtain an irrevocable letter
of credit from the lending institution referred to in paragraph 6
above in an amount equal to one hundred twenty percent (120%) of the
total construction cost set forth in Section A.1 above less
construction advances as such advances are tendered; said letter shall
name the CITY as beneficiary thereof andall by its express terms
and conditions require that all of said,°, sed to complete the �f
improvements as set forth in said Section A.1.
If the DEVELOPER acts as
its own contractor and does not retain a
general contractor, the CITYshall not require the DEVELOPER t0 post a
performance bond.
Section C. CONDITIONS SUBSEQUENT TO THE CITY'S CONVEYANCE OF
THE PREMISES TO THE DEVELOPER
Except as otherwise specified herein, the following express
conditions, covenants, and restrictions shall be expressly incorpo-
rated into the CITY'S Deed to the DEVELOPER, and shall run with the
land:
1. Deed Covenants. It is intended and agreed, and the Used
shall so expressly provide, that the express conditions, Covenants,
and restrictions provided in Section C. hereof shall be covenants
"running with the land" and that they shall be binding, to the fullest
extent permitted by law and equity, for the benefit and in favor of,
and enforceable by, the CITY and any successor in interest to the
Premises or any part thereof for the time periods specifically pre-
scribed herein for each. None of the provisions and remedies below,
including the Reversion specified in Section C.10., shall be construed
so as to limit the DEVELOPER'S liability to the CITY for the DEVEL-
OPER'S breach of any of its obligations under this Option Agreement
and the Deed.
2. Use Restriction. The DEVELOPER agrees for itself, and
every successorssor vinterest to the Premises, or any part thereof, and
the Deed shall contain express covenants on the part of the DEVELOPER
for itself, and its successors andassigns, that the Premises and any
improvements which may be or may become located thereon shall be used,
constructed, developed, occupied and maintained in accordance with the
laws, ordinances, or regulations of the State of Maine and the City of
Bangor, as the same may now or hereafter be in effect. In the event
that both the State and the City have law(s) governing the same sub-
ject matter, DEVELOPER agrees that the Premises and any improvements
which may be or may become located thereon shall be governed by the
most restrictive of these law(s). The Developer further agrees that
any structure, or the occupancy thereof, constructed on the Premises
shall not unreasonably interfere in any way with the operation, main-
tenance
m-tenance , repair or replacement of all existing sewer lines on the
Premises. In addition to other requirements herein, the Developer
shall not construct any structure on the Premises without receiving
prior written certification by the City Engineer that said structure
shall not unreasonably interfere with said sewer.
3. Anti -discrimination. The DEVELOPER agrees for itself, and
every a essor in rote rest Co the Premises, o any part thereof, and
the Deed shall contain express covenants on the part of the DEVELOPER
for itself, and its successors and a signs, that the DEVELOPER, and
its successors and assigns, shall not discriminate upon the basis of
race, color, creed, national origin, sex, or physical handicap in the
sale, lease, or rental, or use cupancy of the Premises or any
improvements thereon. This covenant shall r n perpetuity. This
covenant against discrimination shall be binding for the benefit and
n favor of, and enforceable by, the CITY and the United States of
America against the DEVELOPER and every successor in interest to the
Premises or any part thereof.
4. Property Taxes. The DEVELOPER agrees for itself, and every
successor in interest to the Premises, or any part thereof, and the
Deed shall contain express covenants on the part of the DEVELOPER for
itself, and its successors and assigns, that the Premises shall be
subject to all taxes andassessments as may be imposed by any govern-
mental authority upon the Premises and any buildings, structures, or
improvements which may be or may become located thereon. It is the
intent of the parties hereto, and DEVELOPER hereby agrees that it does
hereby waive, for itself and any successors in interest, all right o
privilegeof exemption from municipal taxation of the Premises and any
buildings, structures, or improvements which may be or may became
located thereon, as may be available by reason of DEVELOPER'S o such
successors' legal status, or for any other reason whatsoever, and that
the City of Bangor, in its capacity as a taxing authority, may assess
all taxes as would otherwise be applicable to the Premises, buildings,
structures or improvements which may be or may become located thereon,
as if such exemption did not exist. DEVELOPER further agrees, for
itself and any successors in interest, to pay any assessments on or
before the date upon which they become due and payable. The CITY
agrees that DEVELOPER, or its successors in interest, shall have the
right to contest the amount of such taxes or assessments in the manner
prescribed by law.
5. Subdivision Restriction. The DEVELOPER agrees for itself,
and every successor in—interest the Premises, or any part thereof,
and the Deed shall contain express covenants on the part of the DEVEL-
OPER for itself, and its successors and assigns, that the Premises
shall not be subdivided without the CITY'S express written consent.
For the purpose of this paragraph, or any restriction or,covenant of
the Quitclaim Deed, any of the following shall not be Seemed to
constitute a subdivision:
a. Development of the project as
condominium pursuant
to the Maine Condominium Act (33M.R.S.A. Sec. 1601-
101 at seg.);
b. Leases of portions of the development; or
c. Construction of separate buildings or structures on
the Premises.
6. Land Speculation Restriction. The DEVELOPER represents and
agrees that its purr
hase of
the Premises and its other undertakings
pursuant to this Option Agreement are and will be used for the purpose
of development of the Premises in accordance with Section B.1., B.2.,
6 B.3 above, and not for speculation in land holdings. This covenant
shall terminate upon the CITY'S issuance of the Certificate of
Completion under Section C.12. below.
7. CITY'S Approval of T[anefe[ P[io[ to Completion. The
DEVELOPER recognises that the qualifications and identity of the
DEVELOPER, and its principals or any successors in interest, are Of
n
particular concern to the CITY.The DEVELOPER further recognizes that
it is because of rsuch qualifications and identity that the CITY i
entering into this Option Agreement and is willing to accept and rely
n the obligations of the DEVELOPER for the faithful performance of
all undertakings and covenants to be performed by the DEVELOPER.
Therefore, the DEVELOPER represents and agrees for itself, its succes-
sors and assigns, that, except only by way of security for the purpose
of obtaining financing necessary to enable the DEVELOPER or any
approved successor in interest to perform the obligations under
Section B hereof, the DEVELOPER has not made or created and, until the
CITY issues the Certificate of Completion under Section C.12. below,
will not make or create, or suffer to be made or created, any total or
partial sale, assignment, conveyance, lease, trust, power, or transfer
in any other mode or form, of, or with respect to, this Option Agree-
ment, the Premises, or any part thereof, or interest therein, nor
shall any contract or agreement to do any of the same be entered into
without the CITY'S prior written approval.
The CITY shall be entitled to require as conditions to any
such approval that:
a. Any proposed transferee shall have the qualifications
and financial responsibility, determined by the CITY
by written evidence submitted to it, to be necessary
and adequate tofulfillthe obligations undertaken
under Section B. hereof;
In. Any proposed transferee, by instrument in writing
satisfactory to the CITY and in a form recordable i
the Penobscot Registry of Deeds, shall for itself and
its successors and assigns, and expressly for the
benefit of the CITY, have expressly assumed all of
the obligations of the DEVELOPER under this Option
Agreement and agreed to be subject to all of the
conditions and restrictions. to which the DEVELOPER is
subject under Section C. hereof; and
C. The consideration payable for the transfer by the
transferee or on its behalf shall not exceed an
mount representing the actual cost to the DEVELOPER
of the Premises and the improvements, if any, there-
tofore made thereon by it; the intent of this pro-
vision being to preclude assignment of the agreement,
or transfer of the Premises, for profit prior to the
CITY'S issuance of the Certificate of Completion
under Section C.12., and to provide that if any such
assignment on transfer is made the CITY shall be
entitled to increase the purchase price to the DEVEL-
OPER by the amount that the consideration payable for
the assignment or transfer is in excess of the amount
that may be authorized pursuant to this subparagraph
c. and such consideration shall, to the extent that
it is in excess of theamount s authorized, belong
and forthwith be paid tthe CITY.
10
The foregoing provisions of this Section C.I. notwithstand-
ing, the DEVELOPER may assign this Option Agreement and all rights and
duties herein, subject to the terms and conditions hereof, to a devel-
opment entity hereafter organized and qualified by DEVELOPER under the
laws of the State of Maine; provided, however, that DEVELOPER shall
retain an active involvement in the entity and the entity shall
n a writing satisfactory to the CITY, the obligation to
complete, in the manner provided for in this Option Agreement, the
contemplated improvements on the Premises. furthermore, the entity
must submit evidence satisfactory to the CITY that it has the quali-
fications and financial responsibility necessary to perform such
obligation.
All covenants contained in this Section C.I. shall termi-
nate upon the CITY'S issuance of the Certificate of Completion under
Section C.12. below.
8. MOTt9aces Prior t0 Completion of Improvements.
a. Prior to the completion of the improvements as cer-
tified by the CITY, neither the DEVELOPER norany
successor in interest to the Premises or any part
thereof shall engage in any financing or any other
transaction creating any mortgage or any other
encumbrance or lien upon the Premises, whether by
express agreement oroperation of law, or permit any
encumbrance or lien to be made o attached to the
Premises, except for the purpose r
of obtaining funds
necessary for making the improvements provided herein
plus the purchase price of the Premises paid by the
DEVELOPER to the CITY. The DEVELOPER shall notify
the CITY in advance of any mortgage financing it
proposes to enter into with respect to the Premises,
and of any encumbrance or lien that has been created
on or attached to the Premises, whether by voluntary
act of the DEVELOPER or otherwise.
b. The holder of any mortgage authorized by this Option
Agreement, including any such holder who obtains
title to the Premises or any part thereof as a result
of foreclosure proceedings or action in lieu thereof,
shall not be obligated by the provisions of this
Option Agreement to construct or complete the
improvements or to guarantee such construction o
completion. No covenant or any other provision in
any deed shall be construed so to obligate any such
holder. However, neither such holder nor its suc-
cessors or assigns shall be authorized to devote the
Premises or any part thereof to any uses, or to con-
struct any improvements thereon, other than those
uses or improvements provided or authorised in this
Option Agreement.
11
All covenants contained in this Section C.B. shall termi-
nate upon the CITY'S issuance of the Certificate of Completion under
Section C.12. below.
9. Notice of Default to Mortgagee.
a. Whenever the CITY shall deliver or make any notice o
demand to the DEVELOPER with respect to any breach or
default by the DEVELOPER in its obligations or cove-
nants under this option Agreement, the CITY shall at
the same time deliver to each holder of record of any
mortgage authorized by this agreement a copy of such
notice or demand. Each such holder shall, insofar as
the rights of the CITY are concerned, have the right
at its option to cure such breach or default and to
add the cost thereof to the mortgage debt and the
lien of its mortgage. However, if the breach or
default is with respect to construction of the
improvements, such holder may not undertake ocon-
tinue the construction or completion of the improve-
ments beyond the extent necessary to conserve or
protect improvements or construction already made
without first having expressly assumed in writing the
obligations to the CITY to Complete, in the manner
provided in this Option Agreement, the improvements
n the Premises or the part thereof to which the lien
r title of such holder relates, and having submitted
evidence satisfactory to the CITY that it has the
qualifications and financial responsibility necessary
to perform such obligation. Any such holder who
shall properly complete the improvements relating to
the Premises or applicable part thereof shall be
entitled, upon written request made to the CITY, to a
certification by the CITY to such effect in
provided in Section C.12. of this Option Agreements
Such certification shall, if so requested by such
holder, provide that any remedy of the CITY'S with
respect to revesting of title to the Premises because
of failure of the DEVELOPER to cure any default with
respect to the construction of the improvements on
other parts of parcels of the Premises, or because of
any other default in or breach of this Option Agree-
ment by the DEVELOPER, shall not apply to the part or
parcel of the Premises to which such certification
relates.
F
b. If after the DEVELOPER'S default under this Option
Agreement, the holder of any mortgage on the Premises
or part thereof does not exercise the option to con-
struct orcomplete the improvements relating to the
Premises or part thereof covered by its mortgage or
to which it has obtained title within 60 days after
the holder has been notified of the default or under-
takes completion of the improvements but does not
complete construction within the period as agreed
upon by the CITY and such holder, the CITY shall have
the option of paying to the holder the amount of the
mortgage debt and securing an assignment of such debt
and of the mortgage.If ownership of the Premises or
part thereof has vested i such holder by way of
foreclosure or action in lieu thereof, the CITY shall
be entitled, at its option, to a conveyance to it of
the Premises or part thereof upon payment to.such
holder of an amount equal to the sum
of the mortgage
debt at the time of foreclosure or action in lieu
thereof less all appropriate credits, including those
resulting from collection and application of rentals
received during foreclosure proceedings; all expenses
with respect to the foreclosure; the net expenses,
exclusive of general overhead, inred by such
holder in and a a direct result of the subsequent
management of the Premises; the cost of any improve-
ments
mprovements made by such holder; and an amount equivalent
to the interest that would have accrued on the
aggregate of such amounts had all such amounts become
part of the mortgage debt and such debt had continued
in existence until such acquisition by the CITY.
C. In the event of the DEVELOPER'S default in its
obligations under any mortgage orother instrument
creating a encumbrance upon the Premises or part
thereof prior to completion of improvements, the CITY
may at its option cure such default or breach. In
such case the CITY shall be entitled, in addition to
and without limitation upon any other remedy to which
it shall be entitled by this Option Agreement, oper-
ation of law, or otherwise, to reimbursement from the
DEVELOPER or successor in
interest of all coats and
n
expenses incurred by the CITY in curing such default
or breach, and to a lien upon the Premises or part
thereof to which the mortgage, encumbrance, or lien
relates, to secure such reimbursement.
d. For the purposes of this and other Paragraphs of this
Option Agreement, the term 'holder' in reference to a
mortgage shall be deemed to include any insurer o
guarantor of any obligation or condition secured by
such mortgage, including but not limited to the
Federal Housing Commissioner, the Administrator of
Veterans Affairs, and any successor in office of
either such official.
13
All covenants contained in this Paragraph 9 shall terminate
upon the CITY'S issuance of the Certificate of Completion under
Section C.12. below.
10. Title Reversion Prior to Completion. In the event that
prior to the CITY'S issuance of the Certificate of Completion under
Section C.12. below:
a. The DEVELOPER, or its successor in interest or
sign, shall default in or violate its obligations
with respect to the construction of the improvements
(including the nature and the dates for the beginning
and completion thereof), or shall abandon or sub-
stantially suspend construction work, and any such
default, violation, abandonment, or suspension is not
cured, ended, or remedied within three (3) months (or
six (6) months, if the default is with respect to the
date for completion of the improvements) after
written demand by the CITY to do a or
b. The DEVELOPER, or its s interest or
assign, shall fail to parealestatetaxes or
ants on the Premises o any part thereof when
due, shall place thereon any encumbrance or lien
unauthorized by Section C. hereof, shall suffer
any levy or attachment to be made, or any material -
men's or mechanics' lien, or any other unauthorized
cumbrance or lien to attach, and such taxes o
assessments shall not have been paid, or the one=-
branceor lien removed or discharged or provision
made, satisfactory to the CITY, for such payment,
removal, or discharge, within thirty (30) days after
the CITY'S written demand to do sop or
C. The DEVELOPER, or its successor In interest or
sign, shall make any asaignment for the benefit of
r
creditors, o receivero similar officer shall be
appointed to take charge of all or any substantial
part of the DEVELOPER'S property, and Such assignment
or appointment isnot dismissed o released within
thirty (30) days of the date the assignment or
appointment is made; or
d. There is, inviolation of Section C. hereof, any
transfer of the Premises or any part thereof, or any
change in ownership of the DEVELOPER, except as
expressly permitted in Section C.7. above, and such
violation shall not be cured within thirty (30) days
after written demand by the CITY to the DEVELOPER:
14
then the CITY shall have the right to re-enter and take possession of
the Premises and to terminate and revert in the CITY the entire estate
conveyed by the Deed to the DEVELOPER as if no Deed had ever been
given; it being the intent of this provision, together with other
provisions of Section C. hereof, that the conveyance of the Premises
to the DEVELOPER shall be made upon, and that the Deed shall Contain,
condition subsequent to the effect that in the event of any default,
failure, violation, c other action or inaction by the DEVELOPER
specified in subparagraphs a., b., C. and d. of Section C.10. hereof,
and failure on the part of the DEVELOPER to remedy, end, or abrogate
such default, failure, violation, or other action or inaction, within
the period and in the manner stated in such subparagraphs, the CITY
at its option may declare a termination in favor of the CITY of the
title, and of all the rights and interests inand to the Premises, and
that such title and all rights and interests of the DEVELOPER, and any
assigns or successors in interest to and in the Premises shall revert
to the CITY; provided, however, that such condition subsequent and
revesting of title in the CITY shall always be subject to and limited
by, and shall not defeat, render invalid or limit in any way; (1) the
lien of any mortgage authorized by Section C. hereof, and (2) any
rights or interests provided in Section C. for the protection of the
holders of such mortgages.
The CITY shall have the right to institute such actions or
proceedings as it may deem desirable for effectuating the purposes of
this Section C.10. including also the right to execute and record or
file among the public land records in the office in which the Deed is
recorded a written declaration of the termination of all the right,
title and interest of the DEVELOPER, its successors in interest and
signs, in the Premises and the revesting of title in the CITY;
provided, however, that any delay by the CITY in instituting or pros-
ecuting any such actions or proceedings or otherwise asserting its
rights under Section C. hereof shall not operate as a waiver of such
rights or to deprive it of or limit such rights in any way.
The express conditions, covenants, and restrictions con-
tained in this Section C.10. shall terminate upon the CITY'S issuance
of the Certificate of Completion under Section C.12. below.
11. Disposition Upon Reversion. Upon the revesting in the CITY
Of title to the Premises o any part thereof as provided in Section
C.10., the CITY shall in accordance with State law use its best
efforts to resell the Premises or part thereof, subject to any exist-
ing mortgage liens, a and in such manner as the CITY shall find
feasible and consistent soon
the objectives of developing the Premises
for retail or professional office use, to a qualified and responsible
party or parties, as determined by the CITY, who will assume the
obligation of making or completing the improvements or
such other
improvements in their stead as shall be satisfactory to the CITY.
is
be applied: Upon the resale of the Premises, the proceeds thereof shall
a. First, to reimburse the CITY for: all costs and
expenses incurred by the CITY including but not
limited to salaries of personnel in connection with
the recapture, management, and resale of the Premises
r part thereof (but less any income derived by the
CITY from the Premises or part thereof); all taxes,
assessments, water, sewer and other utility charges
with respect to the Premises or part thereof; any
payments made or necessary to be made to discharge
any encumbrances or liens existing on the Premises
or part thereof at the time of revesting of title
thereto in the CITY or to discharge or prevent from
attaching or being made any subsequent encumbrances
r liens due to obligations, defaults, or acts of the
DEVELOPER, its successors or assigns; any expendi-
tures made or obligations incurred with respect to
i
the making o completion ofthe .improvements or any
part thereof on the Premises or part thereof; and any
amounts otherwise owing to the CITY by the DEVELOPER
and its successor Or assign; and
b. Second, to reimburse the DEVELOPER, its successor or
assign, up to the amount equal to: (1) the sum of
the purchase price paid by it for the Premises or
part thereof and the cash actually invested by it in
making any of the improvements on the Premises or
part thereof; less (2) any gains or income withdrawn
or made by it.
The CITY shall retain as its property any balance remaining after such
reimbursement.
The express conditions, covenants, and restrictions con-
tained in this Section C.11. shall terminate upon the CITY'S issuance
of the Certificate of Completion under Section C. 12. below.
12. Certificate of Completion. Promptly after completion of
the improvements accordance with the provisions or this option
Agreement, the CITY will furnish the DEVELOPER with an appropriate
instrument so certifying, which instrument shall not be unreasonably
withheld. Such certification shall be in such form as will enable it
to be recorded in the Penobscot Registry of Deeds. The CITY'S issuance
of the Certificate of Completion will constitute con-clusive proof of
the satisfaction and termination of the express conditions, c ants,
and restrictions contained in Sections C.6., CA., C.B., C.9. ,C.10.,
and C.11. above.
16
If the CITY shall refuse or fail to provide such certifi-
cation, the CITY shall, within thirty (30) days after written request
by the DEVELOPER, provide the DEVELOPER with s written statement
indicating in adequate detail in what respects the DEVELOPER has
failed to complete the improvements in accordance with the provisions
of this Option Agreement and what measures will be necessary to obtain
such certification.
13. Severability. If any provision of this Option Agreement is
determined to be invalid or unenforceable under law, it shall not
affect the validity or enforcement of the remaining obligations or
portions hereof.
14. Notice. Any notice under this Option Agreement by either
party to the other shall be sufficiently given or delivered if it is
dispatched by registered or certified mail, postage prepaid, return
receipt requested, or delivered personally, and
a. in the case
of the DEVELOPER, i addressed to or
delivered personally to the DEVELOPER, at Gridley
Street Associates c/o George Gillis, P.O. Box 479,
Brewer, Maine 04412.
b. in the case of the CITY, is addressed to or delivered
personally to the CITY, c/o City Manager, City Hall,
73 Harlow Street, Bangor, Maine 04401,
r to such other persons or addresses as the parties may designate in
writing to the other.
IN WITNESS WHEREOF, the parties hereto have set their hands the
day and year first written above.
CITY OF BANGOR
By %�////�,q�®
ELward A. Barrett
Its City Manager
GRIDLEY STREET ASSOCIATES
BY.ay/O�
STATE OF MAINE
Penobscot. as.
MFI:IB
17
Then personally appeared the above-named Edward A. Barrett,
n his capacity as the City Manager of the City of Bangor, and
acknowledged the foregoing instrument to be his free act and deed in
such capacity and the free act and deed of the City of Bangor.
Before me, O
Printed Name: yf4ry LS.N 6.4e �i
N e
Attorney at Law
STATE OF MAINE
Penobscot, as. oe'*lb3 '1988
Then personally appeared the above-named t Ift Y/lY/1a
his capacity as Ayp�g@j g./M6fiaiA, of Gridley Street seoc�iM and
n
acknowledged the foee g instrument to be his free act and deed in
such capacity and the free act and deed of Gridley Street Associates.
Before me,
a�N�a &&o
Printed Name: rarq c� �
woranr. eems
Notary Pub
Attorney at Law
NOTE
THIS DISPOSITION PLAN IS BASED ON
PLISGA & DAY LAND SURVEYORS
SURVEY PLAN DATED AUGUST I, 1988
v
SCALE: Int = 401
0 20 40' 80 120' 160 20Q
09
EXHIBIT A
PLAN for H2 8i H3
SEPTEMBER 28, 1988
DEPARTMENT OF PLANNING & COMMUNITY DEVELOPMENT