21. DDA Habitat for Humanity (Cleo Ave)COMMUNITY DEVELOPMENT DEPARTMENT
HOUSING SERVICES DIVISION
CITY HALL
10300 TORRE AVENUE - CUPERTINO, CA 95014 -3255
(408) 777 -3251 - FAX (408) 777 -3333
CITY COUNCIL STAFF REPORT
Agenda Item No. 21
Agenda Date: June 1, 2010
SUBJECT
Adopt a resolution to consider approving a. Disposition and Development Agreement
(DDA) between the City of Cupertino and Habitat for Humanity to transfer property on
Cleo Avenue from City ownership to Habitat for Humanity Silicon Valley ownership,
Resolution No. 10- I D
RECOMMENDATIONS
Staff recommends Council:
1. Approve the attached DDA allowing the City to transfer the property to Habitat for
Humanity Silicon Valley, Resolution No. 10 - 1 -
2. Direct staff to prepare a Quitclaim Deed of Trust for the City Manager's signature
that will officially transfer the property ownership to Habitat for Humanity Silicon
Valley.
BACKGROUND
In August 2005, the City acquired excess property on Cleo Avenue property from the
California Department of Transportation (C:altrans) for development of an affordable
housing project (see Attachment 1 for the project aerial map). A Request for Proposals
(RFP) was issued in 2007 to evaluate prOF-osed affordable development on the site.
Habitat for Humanity Silicon Valley was the only agency that responded to the RFP and
was thus selected by the City Council to develop the property in December 2007. As
part of the proposal, the City Council agreed to transfer the property to Habitat for
Humanity for the construction of four single family homes. The City also agreed to
rezone the property from Multi Family Residential (R -3) to Planned Development
Residential (P (Res)) and completed the rezoning process in March 2008.
Next Steps
In order for the Habitat for Humanity to move forward, they are requesting that the
City enter into a DDA and transfer ownership of the property so they can secure the
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Disposition & Development Agreement June 1, 2010 Page 2 of 2
necessary grants and apply for the entitlements (Tentative Map and Planned
Development Permit) for the project.
Following the execution of the DDA, staff will work with the City Attorney's office to
prepare a Quitclaim Deed of Trust for the City Manager's signature to complete the
transfer of the property from the City of Cupertino to Habitat for Humanity Silicon
Valley.
Prepared by: Vera Gil, Senior Planner
Reviewed by: Kelly Kline, Redevelopment/ Economic Development Manager
Submitted by:
arti Shrivastava
Community Development Director
ATTACHMENTS
Attachment A
Attachment B
Approved by:
David W. Knapp
City Manager
Resolution No. 10- 166
Draft Disposition and Development Agreement
G: � Planning \ PDREPORT\ CC` 2070 � dda.doc
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ATTACHMENT A
RESOLUTION NO. 10- K
r
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CUPERTINO APPROVING THE
DISPOSITION AND DEVELOPMENT AGREEMENT (DDA) BETWEEN THE CITY OF
CUPERTINO AND HABITAT FOR HUMANITY SILICON VALLEY AND AUTHORIZING
THE CITY MANAGER TO EXECUTE SAID AGREEMENT
WHEREAS, the City of Cupertino purchased surplus property from the State of
California Department of Transportation (CalTrans) for the development of affordable
housing; and
WHEREAS, the City of Cupertino selected Habitat for Humanity to develop four
affordable housing units for very and extremely low income families; and
WHEREAS, Habitat for Humanity requires ownership of the land to construct the
four units and apply for State grants; and
WHEREAS, the City of Cupertino wishes to guarantee the construction of
affordable housing on the lot;
NOW, THEREFORE BE IT RESOLVED, that the City Council of the City of
Cupertino hereby approves the DDA between the City of Cupertino and Habitat for
Humanity and authorizes the City Manager to execute the agreement on behalf of the City
of Cupertino.
PASSED AND ADOPTED at a regular meeting of the City Council of the City of
Cupertino this 1St day of Lune 2010 by the following vote:
VOTE MEMBERS OF THE CITY COUNCIL
AYES:
NOES:
ABSENT:
ABSTAIN:
Attest: Approved:
City Clerk
Mayor, City of Cupertino
H: \-CLEO AVENUE \DDA Reso.DOC 21-3
ATTACHMENT B
DISPOSITION AND DEVELOPMENT AGREEMENT
BETWEEN THE CITY OF CUPERTINO AND
HABITAT FOR HUMANITY SILICON VALLEY FOR CLEO AVENUE PROPERTY
This Disposition and Development Agreement ( "Agreement ") is entered into as
of , 2010, and is by and between the City of Cupertino, a municipal
corporation ( "City ") and Habitat for Humanity Silicon Valley, a California nonprofit public
benefit corporation ( "Developer ").
RECITALS
A. These Recitals refer to and utilize certain capitalized terms which are defined in
Article 1 of this Agreement. The parties intend to refer to those definitions in conjunction with
the use of capitalized terms in these Recitals.
B. The City Council of the City of Cupertino ( "City ") obtained the Cleo Avenue
property ( "Property ") located in the City of Cupertino, County of Santa Clara, from CalTrans for
the sum of $515,000 for the specific purpose of creating affordable housing.
C. The City intends to convey the real property, more particularly described in the
attached Exhibit A to the Developer pursuant to the terms of this Agreement.
D. The City and the Developer desire to cause the development of four (4) single -
family detached homes ( "Single- Family Homes ") and ancillary landscaping, parking, and other
improvements ( "Improvements "). The Developer shall market and sell the Single - Family Homes
( "Homes ") at an affordable price to very low income homebuyers ( "Eligible Purchasers ") who
are involved in the Developer's sweat equity program.
E. The City desires to use Community Development Block Grant Funds to provide a
Revocable Grant in the approximate amount of Two Hundred Thousand Dollars ($250,932) to
the Developer to assist the Developer in the provision of mortgages ( "City ").
F. To effectuate this purpose, the City will transfer the Property to the Developer at
no cost, and will provide the City Grant to the Developer to assist in financing mortgages, all as
fully set forth in this Agreement.
G. Through this Agreement and accompanying documents the City is imposing
occupancy and affordability restrictions on the Development in order for the City to meet its the
goals and objectives of improving and increasing the community's supply of affordable housing.
H. The Developer proposes to construct the Improvements and to sell each Home to
each Eligible Purchaser at an affordable sales price. Each Home will be sold subject to a
Homebuyer Resale Restriction and Option to Purchase Agreement that will ensure long -term
affordability of the Home.
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I In addition, Developer will record deed restrictions against each Home and
provide each Eligible Purchaser with first mortgage loans to assist with the purchase of a Home.
J As set forth the in Section 2.3 of 1:his Agreement, the City has not approved, nor
will it approve the Improvements until all required environmental reviews under the California
Environmental Quality Act have been completed.
K. The City has concluded that the Developer has the necessary experience, skill and
ability to carry out the commitments contained in this Agreement and that this Agreement will
benefit the City.
NOW, THEREFORE, in consideration of the recitals hereof and the mutual promises and
covenants set forth in this Agreement, the City and the Developer agree as follows:
ARTICLE 1
DEFINITIONS AND EXHIBITS
Section 1.1 Def initions .
In addition to the terms defined elsewhere in this Agreement, the following definitions
shall apply throughout this Agreement:
(a) "Affordable Housing Cost" means the total cost of ownership of a Home
which shall not exceed a Monthly Housing Cost of thirty percent (30 %) times fifty percent
(50 %) of the Area Median Income adjusted for household size.
(b) "Agreement" means this Disposition and Development Agreement,
including the attached Exhibits and all subsequent amendments to this Agreement.
(c) "Annual Income" means the total anticipated annual income of all persons
in a household, as calculated in accordance with 25 California Code of Regulations Section
6914.
(d) "Approved Construction Plans" has the meaning set forth in Section
of this Agreement.
(e) "Approved Security Interest" means a mortgage, deed of trust, or other
reasonable method of security encumbering the Property, or any portion thereof that meets the
requirements of this Agreement.
(f) "Area Median Income" means the median income for households in Santa
Clara County, California, as published from time to time by the United States Department of
Housing and Urban Development (the "HUD "). in the event such income determinations are no
longer published by HUD, or are not updated for a period of at least twenty -four (24) months, the
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City shall provide other income determinations which are reasonably similar with respect to the
method of calculation to those previously published by HUD.
(g) "Building Permits" has the meaning set forth in Section 2.7 of this
Agreement.
(h) "CEQA" means the California Environmental Quality Act, Sections 21000
et seq. of the Public Resources Code and the CEQA Guidelines set forth at 14 California Code of
Regulations Sections 15000 et seq.
(i) "Certificate of Completion" means the certificate of completion to be
issued by the City to the Developer after completion of the Improvements in accordance with the
provisions set forth in Article 5 of this Agreement.
0) "City" means the City of Cupertino, California, a municipal corporation,
operating through its governing body, the City Council and its various departments.
(k) "City Council" means the City Council of the City of Cupertino in its
capacity as the legislative body of the City.
(1) "City Documents" means this Agreement and any other documents the
City requires the Developer to execute to implement the provisions of this Agreement.
(m) "City Grant" means the sum of money provided by the City to the
Developer to assist with mortgage financing for the Eligible Purchasers, as described in Article 4
of this Agreement.
(n) "Concept Plan" has the meaning set forth in Section 2.5 of this Agreement.
(o) "Construction Documents" has the meaning set forth in Section 5.1 of this
Agreement.
(p) "County" means County of Santa Clara, a political subdivision of the State
of California.
(q) "Developer" means Habitat for Humanity Silicon Valley, Inc., a California
nonprofit public benefit corporation, and any approved successors and assigns pursuant to this
Agreement.
(r) "Development" means the Property and the Improvements.
(s) "Eligible Purchaser" means a qualified Very Low Income Household that
meets the condition set forth in Section 1.1 W) of this Agreement.
(t) , "Escrow" means the escrow established with the Title Company for
purchase of the Property pursuant to this Agreement.
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(u) "First Mortgage Assistance" means the first mortgage assistance provided
to the Eligible Purchasers by the Developer.
(v) "Habitat Deed of Trust" means the deed of trust from an Eligible
Purchaser to the Developer evidencing the Developer's First Mortgage Assistance to the Eligible
Purchaser.
(w) "Habitat Documents" means the Habitat Grant Deed and Restrictions, the
Habitat Promissory Note and the Habitat Deed of Trust.
(x) "Habitat Grant Deed and Restrictions" means the grant deed and
restrictions between the Eligible Purchase and Developer which places restrictions on the resale
of the Home and gives Developer an option to repurchase the Home.
(y) "Habitat Promissory Note" means the promissory note from an Eligible
Purchaser to Developer evidencing the First Mortgage Assistance to Eligible Purchaser from the
Developer.
(z) "Hazardous Materials" means:
(i) any "hazardous substance" as defined in Section 101(14) of the
Comprehensive Environmental Response, Compensation, and Liability Act 1980 ( "CERCLA ")
(42 U.S.C. Section 9601(14)) or Section 25281(d) or 25316 of the California Health and Safety
Code at such time;
(ii) any "hazardous waste," "infectious waste" or "hazardous material"
as defined in Section 25117, 25117.5 or 25501(j) of the California Health and Safety Code at
such time;
(iii) oil, petroleum or other hydrocarbon, or any other waste, substance
or material designated or regulated in any way as "toxic" or "hazardous" in the Resource
Conservation and Recovery Act of 1976 ( "RCRA ") (42 U.S.C. Section 6901 et seq.), CERCLA,
Federal Water Pollution Control Act (33 U.S.C. Section 1521 et seq.), Safe Drinking Water Act
(42 U.S.C. Section 3000 (f) et seq.), Toxic Substances Control Act (15 U.S.C. Section 2601 et
seq.), Clear Air Act (42 U.S.C. Section 7401 et seq.), California Health and Safety Code (Section
25100 et seq., Section 3900 et seq.), or California Water Code (Section 1300 et seq.) at such
time; and
(iv) any additional wastes, substances or material which at such time
are classified, considered or regulated as hazardous or toxic under any other present or future
environmental or other similar laws relating to the Property and the Improvements.
The term "Hazardous Materials" shall not include: (i) construction materials,
gardening materials, household products, office supply products or janitorial supply products
customarily used in the construction, maintenance, rehabilitation, or management of residential
housing or associated buildings and grounds, or typically used in household activities, or (ii)
certain substances which may contain chemicals listed by the State of California pursuant to
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California Health and Safety Code Sections 25249.8 et seq., which substances are commonly
used by a significant portion of the population living within the region of the Development,
including, but not limited to, alcoholic beverages, aspirin, tobacco products, nutrasweet and
saccharine.
(aa) "Hazardous Materials Laws" means all federal, state, and local laws,
ordinances, regulations, orders and directives pertaining to Hazardous Materials in, on or under
the Property and the Improvements or any portion thereof.
(bb) "Holder" means the holder of an Approved Security Interest.
(cc) "Home" or "Homes" means one or all of the four (4) single- family homes
to be constructed on the Property pursuant to this Agreement.
(dd) "Improvements" mean, collectively, the Homes and appurtenant
landscaping and improvements.
(ee) "Insurance Period" has the meaning set forth in Section 5.7 (d) of this
Agreement.
Of) "Monthly Housing Cost" shall include all of the following costs associated
with owning a Home:
(i) Principal and interest on mortgage loans and any loan insurance
fees associated therewith.
(ii) Property taxes and assessments.
improvements.
(iii) Fire and casualty insurance covering replacement value of property
(iv) Property maintenance and repairs.
(v) A reasonable allowance for utilities, including garbage collection,
sewer, water, electricity, gas, and other heating, cooking, and refrigeration fuels. Utilities do not
include telephone service. Such an allowance shall take into consideration the cost of an
adequate level of service.
(vi) Homeowner association fees, if any.
Monthly housing cost of a purchaser shall be an average of estimated costs for the next
twelve months.
(gg) "Property" means the real property that is a subject of this Agreement
located at the end of Cleo Avenue in the City of Cupertino, California, as more specifically
described in the attached Exhibit A .
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(hh) "Term" means the term of this Agreement which shall begin on the date of
execution of this Agreement and end on the date of sale of the fourth and last Home to an
Eligible Purchaser pursuant to this Agreement.
(ii) "Title Company" means Old Republic Title Company, 1900 The Alameda,
San Jose, CA 95152, or such other title insurance company as shall be designated by the City.
6j) "Very Low Income Household" means an Eligible Purchaser with an
Annual Income that does not exceed the qualifying limits for very low income families as
established and amended from time to time pursuant to Section 8 of the United States Housing
Act of 1937, and as published by the State of California Department of Housing and Community
Development.
Section 1.2
Exhibits
The following Exhibits are attached to this Agreement and by this reference are
incorporated herein and made a part hereof:
Exhibit A Legal Description of Cleo Avenue Property
Exhibit B Development Schedule
Exhibit C Certificate of Completion
Exhibit D Insurance Requirements
ARTICLE 2
PREDISPOSITION REQUIREMENTS
Section 2.1 Conditions Precedent to Develo ment
As conditions precedent to the City's obligation to convey the Property to the Developer,
the following conditions set forth in Sections 2.2 through 2.7 of this Agreement must first be met
by the dates set forth in the Development Schedule attached to this Agreement as Exhibit B ,
subject to the extension of any time limit in writing by the City. In addition, as a condition
precedent to the City conveying the Property to the Developer, the Developer must comply with
the provisions set forth in Sections 3.4 and 5.7 of this Agreement, as more fully stated in those
Sections.
Section 2.2 Phase I Repo s, Hazardous Materials Investi ation
(a) Prior to the close of Escrow, the City grants the Developer the right to
enter the Property for a period of ninety (90) days after the date of this Agreement for the
purpose of performing its own independent investigation, including, but not limited to, Phase I
and Phase II studies, concerning the presence of Amy Hazardous Materials on the Property. The
Developer shall deliver copies of such reports to the City as soon as they are prepared. The
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Developer shall defend (with counsel acceptable to the City), indemnify and hold harmless the
City from any claim or damage arising from the Developer's entry onto the Property.
If during the course of its independent investigation, the Developer concludes that
Hazardous Materials are present on the Property through no fault of the Developer then the
Developer may request that the City remediate such conditions of the Property prior to
conveyance of the Property to the Developer. If in the reasonable determination of the
Developer and the City, the Property is not suitable for the use to which it is required to be put
under this Agreement or remediation of the discovered Hazardous Materials on the Property is
prohibitively expensive, then the Developer and the City shall have the right to terminate this
Agreement pursuant to Section 9.1; provided, however, that this Agreement may only be
terminated pursuant to Section 9.1 if the terminating party notifies the other party in writing
within one (1) year following the date of this Agreement.
Section 2.3 Environmental Review
If the Developer obtains federal funding and is required to undergo National
Environmental Policy Act (NEPA) review, NEPA review and California Environmental Quality
Act (CEQA) review will be conducted as simultaneously as possible. The Development is
subject to completion of all required CEQA environmental review. Within sixty (60) days after
the date of this Agreement, the City, at the Developer's sole cost and expense, shall diligently
complete any required environmental review of the Development in accordance with CEQA.
The Developer acknowledges that the environmental review process under CEQA may involve
preparation and consideration of additional information as well as consideration of input from
interested organizations and individuals; that approval or disapproval of the Development
following completion of the environmental review process is within the sole, complete,
unfettered and absolute discretion of the City without limitation by or consideration of the terms
of this Agreement; and that the City makes no representation regarding the ability or willingness
of the City to approve the Development at the conclusion of the environmental review process
required by CEQA, or regarding the imposition of any mitigation measures as conditions of any
approval that may be imposed on the Development. The parties recognize that, as a result of the
environmental review process, each party has the absolute discretion and right to terminate this
Agreement, and no cost shall be incurred by either party as a result of such termination. In
addition, the Developer acknowledges that any required approvals by any other local, state or
federal City may require additional environmental review, and that any approval by the City
shall not bind any other local, state or federal City to approve the Development or to impose
mitigation measures which are consistent with the terms of this Agreement or with the terms of
any mitigation measures required by the City pursuant to the City's environmental review
Section 2.4 Government and Land Use Approvals
The Developer, prior to the date of this Agreement, has applied for and, with the City's
assistance and cooperation, shall diligently pursue efforts to obtain issuance of all governmental,
land use and utility approvals (in addition to the Building Permits described below) necessary for
construction of the' Improvements, including but not limited to a final subdivision map and
subdivision requirements as set forth by the Department of Real Estate, any governmental or
regulatory approvals, permits or authority for the Development and design review. The
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Developer acknowledges that execution of this Agreement by the City does not constitute
approval by the City and in no way limits the discretion of the City in granting any required City
permit or approval.
The City will cooperate as is necessary, to assist the Developer in applying for and
obtaining all government, land use and utility approvals and permits (including the Building
Permits), including executing documents required to be executed by the owner of the Property.
Section 2.5 Concept Plan
Prior to the City's consideration of this A;geement, the City issued a Request for
Proposals ( "RFP ") dated August 20, 2007 which contained a Concept Plan for the project and in
its October 17, 2007 response to the RFP, Developer agreed to the Concept Plan, as well as its
desire to develop "green" buildings.
If the Developer desires to change the Improvements in any material manner which
causes the Improvements not to be in substantial conformity with the Concept Plan, the
Developer shall submit to the City Council a revised Concept Plan for the City Council's
consideration. The City Council shall review the revised Concept Plan and either approve or
disapprove the revised Concept Plan within thirty (30) days after receipt. Any disapproval shall
state in writing the reasons for disapproval and the change requested by the City. The Developer
shall thereafter submit a re- revised Concept Plan to the City Council for its approval within thirty
(30) days after the City's notification of disapproval. The City Council shall approve or
disapprove the re- revised Concept Plan within thirty (30) days after receipt. If the City Council
does not approve the re- revised Concept Plan after this second submittal, this Agreement shall
terminate pursuant to Section 9.1. When the revised Concept Plan has been approved by the City
Council, it shall form a part of this Agreement.
Section 2.6 Construction Plans
No later than the date ninety (90) days after the date of this Agreement, the Developer
shall deliver to the City a set of the completed Construction Plans. "Construction Plans" means
all construction documentation upon which the Developer and the Developer's contractors and
subcontractors shall rely in building the Improvements and shall include, but not necessarily be
limited to final architectural drawings, landscaping plans and specifications, final elevations,
building plans and specifications, and a time schedule for construction.
The City shall, if the Construction Plans conform to the provisions of this Agreement and
conform with the Concept Plan, approve in writing such Construction Plans and no further filing
by the Developer or approval by the City thereof shall be required except with respect to any
material change. Unless rejected by the City for their failure to comply with the foregoing
requirements within thirty (30) days of submission by the Developer, the Construction Plans
shall be deemed accepted.
If rejected by the City in whole or in part, the Developer shall submit new or corrected
Construction Plans within thirty (30) days of notification of the City's rejection and the reasons
therefor. The City shall then have thirty (30) days to review and approve the Developer's new or
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corrected Construction Plans. The provisions of this section relating to time periods for
approval, rejection, or resubmission of new or corrected Construction Plans shall continue to
apply until the Construction Plans have been approved by the City.
Section 2.7 Building Permits
No later than one hundred twenty (120) days after the date of this Agreement, the
Developer shall submit the Construction Plans and an application for all necessary building and
related City permits (collectively, the `Building Permits ") from the City Building Department.
The Developer shall thereafter diligently pursue and obtain issuance of the Building Permits. The
Developer acknowledges that execution of this Agreement by the City does not constitute
approval by the City and in no way limits the discretion of the City in approving or rejecting the
Construction Plans or in granting or denying the Building Permits. Once Building Permits are
obtained, they must be kept active and in force until completion of the project.
The Construction Plans upon which the Building Permits are granted shall constitute the
"Approved Construction Plans." Promptly upon receipt of the Building Permits, the Developer
shall submit to the City a complete set of the Approved Construction Plans.
ARTICLE 3
DISPOSITION OF PROPERTY
Section 3.1 Sale and Purchase
Provided the pre - disposition requirements set forth in Article 2 and the additional closing
conditions set forth in Section 3.4 and 6.2 have been satisfied, the City shall transfer the Property
at no cost to the Developer, pursuant to the terms, covenants, and conditions of this Agreement.
Section 3.2 Opening Escrow.
To accomplish the transfer of the Property from the City to the Developer, the parties
shall establish the Escrow with the Title Company. The parties shall execute and deliver all
written instructions to the Title Company to accomplish the terms hereof, which instructions
shall be consistent with this Agreement.
Section 3.3 Close of Escrow
Escrow for the conveyance of the Property shall close on a date mutually acceptable to
the City and the Developer within thirty (30) days following the date on which all conditions
precedent to conveyance of the Property set forth in Article 2 have been satisfied, but in no event
later than August 31, 2010 or such later date that the City and the Developer agree upon. In
addition to the conditions precedent to conveyance set forth in Article 2, the following conditions
shall be satisfied prior to or concurrently with, and as conditions of, conveyance of the Property:
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(a) The Developer shall provide the City with certified copies of corporate
authorizing resolutions, approving the City Documents to be executed by the Developer as
applicable, and the Developer's execution of the City Documents.
(b) The Developer shall have furnished the City with evidence of the
insurance coverage required by Section 5.7 and a memorandum of this Agreement.
(c) There shall exist no condil.ion, event or act which would constitute a
material breach or default under this Agreement or any other City Document or which, upon the
giving of notice or the passage of time, or both, would constitute such a material breach or
default.
(d) All representations and warranties of the Developer contained in any City
Document shall be true and correct as of the close of Escrow.
Section 3.4 Condition of Title
(a) Upon the close of Escrow on the Property, the City shall convey the
Property to the Developer by the City Grant Deed and the Developer shall have insurable fee title
to the Property which shall be free and clear of al l liens, encumbrances, clouds and conditions,
rights of occupancy or possession, except:
(i) applicable building, and zoning laws and regulations;
(ii) the provisions of this Agreement;
(iii) the provisions of the City Grant Deed;
(iv) any lien for current taxes and assessments or taxes and assessments
accruing subsequent to recordation of the City G ant Deed;
(v) any liens of Approved Security Interests;
(vi) conditions, covenants, restrictions or easements shown in the
Preliminary Title Reports for the Property.
Section 3.5 Condition of P ro p e
The City and the Developer understand and agree that the Property shall be purchased by
the Developer, "as is ", after City's completion of the remediation work, if any, pursuant to
Section 2.2, and that the City shall in no way be responsible for demolition, site preparation or
any other removal or replacement of improvements thereon except as provided in Section 2.2.;
provided, however, that the City shall be responsible for remediation of any and all Hazardous
Materials, contamination or other conditions arising in connection with the City's or City's use,
ownership, or possession of the Property. Except to the extent expressly set forth in this
Agreement, Developer agrees to accept conveyance of the Property in its condition after
completion of any remediation work by the City as provided in Section 2.2, "as is" and without
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representation or warranty from the City with respect to the condition of the Property including,
but not limited to, the condition of the soil, presence of hazardous materials or contaminants, and
all other physical characteristics. The Developer has performed and relies solely upon its own
independent investigation concerning the physical condition of the Property or compliance of the
Property with any statutes, ordinances, rules or regulations.
Except as provided in this Agreement, if the conditions of the Property are not in all
respects entirely suitable for the use or uses to which the Property will be put as described in this
Agreement, then it is the sole responsibility and obligation of the Developer to correct any soil
conditions, correct any subsurface condition, correct any structural condition, demolish any
improvements and otherwise put the Property in a condition suitable for the Development to be
constructed pursuant to this Agreement. The Developer hereby waives any right to seek
reimbursement or indemnification from the City or the City of the Developer's costs related to
correction of any physical conditions on the Property, including but not limited to the presence of
Hazardous Materials, except for the remediation work to be completed by the City pursuant to
Section 2.2 and except for any loss, damage, cost, expense or liability arising in connection with
the City's or City's use, ownership or possession of the Property.
This Section does not in any way limit the right of the Developer to seek reimbursement
from parties other than the City and the City for the Developer's costs related to correction of
any physical conditions on the Property, including but not limited to the presence of Hazardous
Materials.
Section 3.6 Costs of Escrow and Closing
Ad valorem taxes, if any, shall be prorated as of the date of conveyance. All costs of
closing the conveyance of the Property, including but not limited to, the cost of title insurance
(including the City's lender's policy), transfer tax, Title Company document preparation,
recordation fees and the escrow fees of the Title Company shall be paid by the Developer. The
costs borne by the Developer are in addition to the Purchase Price for the Property.
ARTICLE 4
CITY GRANT
Section 4.1 Amount
Subject to the terms and conditions set forth in the City Documents, the City hereby
agrees to grant, and the Developer hereby agrees to accept an amount up to Two Hundred Fifty
Thousand Nine Hundred Thirty Two Dollars ($250,932) in order to provide Eligible Purchasers
with mortgage assistance.
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Section 4.2 City Grant Disbursement
(a) The City Grant shall be disbursed in accordance with the following
provisions of this section. Satisfaction by the Developer of the following requirements shall be
conditions precedent to the City's obligation to disburse the City Grant:
(i) the City shall have conveyed the Property to the Developer, and a
memorandum of this Agreement shall have been recorded against the Property;
(ii) there shall exist no condition, event or act which would constitute a
material breach or default under this Agreement Dr any other City Documents or which, upon the
giving of notice or the passage time, or both, would constitute such a material breach or default;
(iii) there shall exist no breach or default declared by any lender or
other party under any document related to any other financing for the Development. A breach or
default shall be deemed "declared" for purposes of this subsection upon delivery of notice to the
Developer that such breach or default is already existing or will exist upon passage of time
without a cure being made by the Developer;
(iv) all representations and warranties of the Developer contained in
any City Document shall be true and correct as of any disbursement of the City Grant;
Upon satisfaction of the above conditions precedent, the City shall from time to time
disburse the City Grant. The Developer shall apply all disbursements to mortgage assistance.
Section 4.3 Assumption
The City Grant shall not be assumable by successors and assigns of the Developer,
without the prior written consent of the City, which consent shall be granted or denied in the
City's sole discretion.
ARTICLE 5
CONSTRUCTION OF IMPROVEMENTS
Section 5.1 Construction of Improvements
The Developer shall construct the Improvements in accordance with the terms and
provisions of the Building Permits, the Approved Construction Plans, and all other governmental
approvals (collectively, the "Construction Documents "), as such may be modified pursuant to the
following paragraph, and in accordance with all applicable federal, state, and local laws and
regulations and the provisions of this Agreement.
If the Developer desires to make any material change in the Construction Documents, the
Developer shall obtain approval of any governmental entity in the manner required by applicable
City or other governmental entity ordinances, regulations, codes, and requirements. In addition,
the Developer shall obtain the prior written approval of the City of any change in the
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Construction Documents prior to authorizing, approving, acting on, or causing or allowing to be
implemented any change in the Construction Documents.
Section 5.2 Commencement and Completion of Improvements
The Developer shall commence construction of the Improvements within thirty (30) days
after issuance of Building Permits to the Developer. The Developer shall diligently prosecute to
completion the construction of the Improvements no later than eighteen (18) months after
commencement of construction. If the Developer fails to complete the Homes and related
Improvements, the Property shall revert back to the City.
Section 5.3 Fees
The Developer shall pay any and all governmental and utility fees required in connection
with construction of the Improvements, including without limitation, fees required for issuance
of the Building Permits, utility hook -up fees, and development impact fees.
Section 5.4 Equal Opportunity
In connection with the construction of the Improvements, neither the Developer nor any
of its contractors, subcontractors or agents shall discriminate on the basis of race, color, creed,
religion, sex, sexual orientation, age, marital status, national origin or ancestry in the hiring,
firing, promoting or demoting of any person engaged in the construction work.
Section 5.5 Prevailing Wages
The Developer shall and shall cause the contractor and subcontractors to pay prevailing
wages in the construction of the Improvements as those wages are determined pursuant to Labor
Code Sections 1720 et sM., to employ apprentices as required by Labor Code Sections 1777.5 et
seq. and the implementing regulations of the Department of Industrial Relations (the "DIR ") and
the Developer shall and shall cause the contractor and subcontractors to comply with the other
applicable provisions of Labor Code Sections 1720 et sew., 1777.5 et seMc ., and implementing
regulations of the DIR. The Developer shall and shall cause the contractor and subcontractors to
keep and retain such records as are necessary to determine if such prevailing wages have been
paid as required pursuant to Labor Code Sections 1720 et se q. and apprentices have been
employed as required by Labor Code Sections 1777.5 et seq. Copies of the currently applicable
current per diem prevailing wages are available from the City's Public Works Department,
Cupertino, California. During the construction of the Improvements, Developer shall or shall
cause the contractor to post at the Property the applicable prevailing rates of per diem wages.
The Developer shall indemnify, hold harmless and defend (with counsel reasonably selected by
the City) the City and the City against any claim for damages, compensation, fines, penalties or
other amounts arising out of the failure or alleged failure of any person or entity (including
Developer, its contractor and subcontractors) to pay prevailing wages as determined pursuant to
Labor Code Sections 1720 et seq., to employ apprentices pursuant to Labor Code Sections
1777.5 et seq., and• implementing regulations of the DIR or to comply with the other applicable
provisions of Labor Code Sections 1720 et sq., 1777.5 et seq., and the implementing regulations
of the DIR in connection with the construction of the Improvements or any other work
undertaken or in connection with the Property prior to issuance of the Certificate of Completion.
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Section 5.6 Inspections
(a) Periodic Inspections In addition to any normal inspections that may be
performed by the City, the City shall have the right to make periodic inspections to determine if
construction of the Improvements is being performed in accordance with the provisions of this
Agreement. The City shall have the right to enter upon the Property for purposes of such
inspections. The results of City inspections shall be incorporated in written reports which shall
include any observed defects or deficiencies in the construction of the Improvements. The City
shall send copies of such reports to the Developer within five (5) business days of each
inspection.
(b) Final Inspection The Developer shall notify the City in writing of the
date when, in the Developer's opinion, the construction of the Improvements will reach
completion. Unless the City has determined and so notifies the Developer that construction of
the Improvements has not reached completion, the City shall promptly arrange for a joint final
inspection by the City and the Developer. Such :final inspection by the City and the Developer
shall not constitute evidence of compliance with or satisfaction of any obligation of the
Developer to any Holder of an Approved Security Interest, and shall not be deemed a final
inspection required by any governmental City or by the City.
(c) Certificate of Completion If the final inspection discloses that the
construction of the Improvements has been completed in accordance with the requirements of
this Agreement, the City shall provide the Developer with a Certificate of Completion in the
form shown in Exhibit C . Such Certificate of Completion shall be conclusive determination that
the covenants in this Agreement with respect to the obligations of Developer to construct the
Improvements have been met. Such Certificate of Completion and determination shall not
constitute evidence of compliance with or satisfaction of any obligation of Developer to any
Holder of an Approved Security Interest, and shell not be deemed a notice of completion under
the California Civil Code, or a certificate of occupancy from the City. The City agrees to issue
partial Certificates of Completion with respect to the portion of the Property comprising
individual Homes as is necessary to accommodate the transfer of individual Homes to the
Eligible Purchasers over time. Upon issuance of the Certificate of Completion, this Agreement
shall terminate, except for those provisions that expressly survive termination.
Section 5.7 Insurance
(a) Fire and Casualty Insuran The risk of loss or damage to the
Improvements by fire or other casualty shall be assumed by the Developer throughout the
Insurance Period (as defined in subsection (d) below). Throughout such Insurance Period, the
Developer shall maintain, at the Developer's sole cost and expense, sufficient fire and casualty
insurance insuring one hundred percent (100 %) of the replacement value of the Improvements.
(b) General Liability Insuranc Throughout the Insurance Period the
Developer shall maintain, at the Developer's sole cost and expense, comprehensive, broad form,
general liability and automobile insurance against claims and liabilities for personal injury,
death, or property damage arising from the Developer's activities under this Agreement,
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providing coverage for at least One Million Dollars ($1,000,000) per occurrence for bodily
injury, personal injury or property damage, with an umbrella policy of Three Million Dollars
($3,000,000).
(c) Worker's Compensation and Employer's Liability Insurance Throughout
the Insurance Period, the Developer shall carry worker's compensation and employer's liability
insurance covering all persons employed by the Developer in connection with its activities under
this Agreement and with respect to whom death, bodily injury and sickness insurance claims
could be asserted against the City or the Developer. The worker's compensation limits shall be
as required by the Labor Code of the State of California and the Employer's Liability limit shall
provide protection of at least One Million Dollars ($1,000,000).
(d) Insurance Period The "Insurance Period" means: the period commencing
upon the date that the Property is conveyed to the Developer and ending on the date all Homes
have been sold to Eligible Purchasers.
(e) General Requirements All insurance required to be maintained by the
Developer pursuant to this Section 5.7 shall be provided in compliance with the "Insurance
Requirements" attached hereto as Exhibit D and incorporated herein by reference.
Section 5.8 Hazardous Materials
The Developer shall keep and maintain the Property in compliance with, and shall not
cause or permit the Property to be in violation of any federal, state or local laws, ordinances or
regulations relating to industrial hygiene or to the environmental conditions on, under or about
the Property including, but not limited to, soil and ground water conditions. The Developer shall
not use, generate, manufacture, store or dispose of on, under, or about the Property or transport
to or from the Property any Hazardous Materials except such of the foregoing as may be
customarily kept and used in and about residential property or except as may be required for
construction of the Improvements in accordance with the Approved Construction Plans, provided
such materials are used and stored in compliance with all applicable laws.
The Developer shall immediately advise the City in writing if at any time it receives
written notice of (i) any and all enforcement, cleanup, removal or other governmental or
regulatory actions instituted, completed or threatened against the Developer or the Property
pursuant to any applicable federal, state or local laws, ordinances, or regulations relating to any
Hazardous Materials, ( "Hazardous Materials Law "); (ii) all claims made or threatened by any
third party against the Developer or the Property relating to damage, contribution, cost recovery
compensation, loss or injury resulting from any Hazardous Materials (the matters set forth in
clauses (i) and (ii) above hereinafter referred to a "Hazardous Materials Claims "); and (iii) the
Developer's discovery of any occurrence or condition on any real property adjoining or in the
vicinity of the Property that could cause the Property or any part thereof to be classified as
"border -zone property" under the provision of California Health and Safety Code Sections 25220
et seq. or any regulation adopted in accordance therewith, or to be otherwise subject to any
restrictions on the ownership, occupancy, transferability or use of the Property under any
Hazardous Materials Law.
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The City shall have the right to join and participate in, as a party if it so elects, any legal
proceedings or actions initiated in connection with any Hazardous Materials Claims at the City's
sole cost and expense. If a shared defense with Developer is appropriate, the City's participation
in such a defense with Developer with joint legal counsel reasonably satisfactory to the City shall
meet the provisions of this section.
The Developer shall indemnify, defend (with counsel acceptable to the City) and hold
harmless the City and its members, supervisors, directors, officers, employees, agents, successors
and assigns from and against any loss, damage, cost, expense or liability directly or indirectly
arising out of or attributable to the use, generation, storage, release, threatened release, discharge,
disposal, or presence of Hazardous Materials on. under, or about the Property to the extent
caused by the Developer, its agents, employees or contractors including without limitation: (a)
all foreseeable consequential damages; (b) the costs of any required or necessary repair, cleanup
or detoxification of the Property and the preparation and implementation of any closure, remedial
or other required plans; and (c) all reasonable costs and expenses incurred by the City in
connection with clauses (a) and (b), including bLit not limited to reasonable attorneys' fees.
The City shall indemnify, defend (with counsel reasonable acceptable to the Developer)
and hold harmless the Developer and its members, supervisors, directors, officers, employees,
agents, successors and assigns from and against any loss, damage, cost, expense or liability
directly or indirectly arising out of or attributable; to the use, generation, storage, release,
threatened release, discharge, disposal, or presence of Hazardous Materials on, under, or about
the Property to the extent caused by the City, the City or their respective agents, employees or
contractors, including without limitation: (a) all :Foreseeable consequential damages; (b) the costs
of any required or necessary repair, cleanup or detoxification of the Property and the preparation
and implementation of any closure, remedial or other required plans; and (c) all reasonable costs
and expenses incurred by the City in connection with clauses (a) and (b), including but not
limited to reasonable attorneys' fees.
Without the City's prior written consent, which shall not be unreasonably withheld, the
Developer shall not take any remedial action in response to the presence of any Hazardous
Materials on, under or about the Property, nor enter into any settlement agreement, consent
decree, or other compromise in respect to any Hazardous Material Claims, which remedial
action, settlement, consent decree or compromise; might, in the City's reasonable judgment,
impair the value of the City's security hereunder; provided, however, that the City's prior
consent shall not be necessary in the event that the presence of Hazardous Materials on, under, or
about the Property either poses an immediate threat to the health, safety or welfare of any
individual or is of such a nature that an immediate remedial response is necessary and it is not
reasonably possible to obtain the City's consent before taking such action, provided that in such
event the Developer shall notify the City as soon as practicable of any action so taken. The City
agrees not to withhold its consent, where such consent is required hereunder, if either (i) a
particular remedial action is ordered by a court of competent jurisdiction, (ii) the Developer will
or may be subjected to civil or criminal sanctions or penalties if it fails to take a required action;
(iii) the Developer establishes to the reasonable satisfaction of the City that there is no
reasonable alternative to such remedial action which would result in less impairment of the
City's security hereunder; or (iv) the action has been agreed to by the City.
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The Developer hereby acknowledges and agrees that (i) this Article is intended as the
City's written request for inf5rmation (and the Developer's response) concerning the
environmental condition of the Property as required by California Code of Civil Procedure
Section 726.5, and (ii) each representation and warranty in this Agreement or any of the other
City Documents (together with any indemnity applicable to a breach of any such representation
and warranty) with respect to the environmental condition of the property is intended by the City
and the Developer to be an "environmental provision" for purposes of California Code of Civil
Procedure Section 736. This Section 5.8 shall survive the expiration of the Term or other
termination of this Agreement.
Section 5.9 Mandatory Language in All subsequent Deeds and Contracts
(a) Basic Requirement The Developer covenants by and for itself, its
successors and assigns that there shall be no discrimination against or segregation of a person or
of a group of persons on account of race, color, creed, religion, sex, sexual orientation, marital
status, national origin, ancestry or disability in the sale, lease, sublease transfer, use, occupancy,
tenure or enjoyment of the Development nor shall the Developer or any person claiming under or
through the Developer establish or permit any such practice or practices of discrimination or
segregation with reference to the selection, location, number, use or occupancy of tenants,
lessees, subtenants, sublessees or vendees in the Development. The foregoing covenant shall run
with the land.
(b) Provisions In Conveyance Documents All deeds or contracts made or
entered into by Developer, its successors or assigns, as to any portion of the Property shall
contain therein the following language:
(i) In Deeds:
"Grantee herein covenants by and for itself, its successors and assigns that
there shall be no discrimination against or segregation of a person or of a group of persons on
account of race, color, creed, religion, sex, sexual orientation, marital status, national origin,
ancestry or disability in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of
the property herein conveyed nor shall the grantee or any person claiming under or through the
grantee establish or permit any such practice or practices of discrimination or segregation with
reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants,
sublessees or vendees in the property herein conveyed. The foregoing covenant shall run with
the land."
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(ii) In Contracts:
"There shall be no discrimination against or segregation of any person or
group of persons on account of race, color, creed, religion, sex, sexual orientation, marital status,
national origin or ancestry or disability in the sale, lease, sublease, transfer, use, occupancy,
tenure or enjoyment of the property nor shall the transferee or any person claiming under or
through the transferee establish or permit any such practice or practices of discrimination or
segregation with reference to the selection, location, number, use or occupancy of tenants,
lessees, subtenants, sublessees or vendees of the land."
ARTICLE 6
MORTGAGE ASSISTANCE AND SALE OF HOMES
Section 6.1 Sale of Homes to Eligible Purchasers
Subsequent to issuance by the City of the Certificate of Completion, the Developer shall
sell all of the Homes to Eligible Purchasers. The Eligible Purchaser shall not pay, as a purchase
price, more than allowed in order to meet Affordable Housing Cost. The City shall approve the
sales prices for each Home prior to the sale of the Home. The Developer shall submit for City
approval the proposed Home sales prices at least thirty (30) days prior to entering into any sales
agreement with an Eligible Purchaser. The City shall either approve or disapprove the proposed
sales price of a Home within fifteen (15) days of submittal of such price. Each of the Eligible
Purchasers of the Homes shall receive Developer First Mortgage Assistance as set forth in
Section 6.2. As a condition of purchase of the Homes, each Eligible Purchaser shall be required
to execute a Habitat Promissory Note, and execute and record against the Home a Habitat Grant
Deed and Restrictions and Habitat Deed of Trust.
An individual who is divorced or legally separated from his or her spouse is
considered a First Time Homebuyer if the individual, while married, owned a home with his or
her spouse but no longer has ownership interest in the home as a result of a court approved
dissolution proceeding or property settlement.
As a condition precedent to an Eligible Purchaser receiving mortgage assistance,
an Eligible Purchaser shall certify that at least one member of the household, at the time of filing
an application: (i) has been a resident of Cupertino for at least one year; (ii) has an immediate
family member (parent, child or sibling) who has been as resident of Cupertino for at least one
year; or (iii) has their primary employment (largest source of income) located within the City of
Cupertino for at least one year.
Section 6.2 Developer Fir Mortgage Assistance and Other Eligible
Purchaser Financing
The parties currently anticipate that the Developer shall provide each Eligible Purchaser
First Mortgage Asgistance. Upon sale of each Home to an Eligible Purchaser, the Eligible
Purchaser shall: (i) execute a Habitat Promissory Note in the amount of the First Mortgage
Assistance; (ii) execute and record against the Home a Habitat Deed of Trust securing the
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Eligible Purchaser's obligations under the Habitat Promissory Note; and (iii) execute and record
against the Home a Habitat Grant Deed and Restrictions agreement.
The Developer may provide an Eligible Purchaser silent second or deferred financing
assistance. Such assistance may require an Eligible Purchaser to: (i) execute a second Habitat
Promissory Note in the amount of the such assistance; (ii) execute and record against the Home a
second Habitat Deed of Trust securing the Eligible Purchaser's obligations under the second
Habitat Promissory Note; and (iii) execute and record against the Home a second Habitat Grant
Deed and Restrictions agreement tailored to the silent second or deferred financing.
ARTICLE 7
SECURITY FINANCING AND RIGHTS OF HOLDERS
Section 7.1 Requirements for Approved Security Interests
The Developer shall not encumber any portion of the Property or the Improvements with
a deed of trust, mortgage or other form of security interest unless such instrument constitutes an
Approved Security Interest meeting the requirements of this Section 7.1.
Unless otherwise approved in writing by the City Managaer, an Approved Security
Interest shall meet the following requirements:
(a) The Approved Security Interest shall secure a construction loan the
proceeds of which are used exclusively for the construction of the Improvements.
(b) An Approved Security Interest shall meet all other requirements of Section
7.6 and Section 7.7 of this Agreement.
Section 7.2 Approved Security Interest Not Invalidated
No breach of any provision of this Agreement shall invalidate the lien of an Approved
Security Interest. Except as otherwise provided, all of the covenants, conditions and restrictions
in this Agreement shall be binding on any owner whose title is delivered through foreclosure
sales, trustee's sale, or otherwise with respect to an Approved Security Interest.
Section 7.3 Holder Not Obligated to Construct
A Holder is not obligated to construct or complete any improvements or to guarantee
such construction or completion; nor shall any covenant or any other provision in conveyances
from the City to the Developer evidencing the realty comprising the Property or any part thereof
be construed so to obligate such Holder. However, nothing in this Agreement shall be deemed to
construe, permit or authorize any such Holder to devote the Property or any portion thereof to
any uses, or to construct any improvements thereon, other than those uses or improvements
provided for or authorized by this Agreement.
Section 7.4 Notice of Default and Right to Cure
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Whenever the City pursuant to its rights set forth in Article 5 of this Agreement delivers
any notice or demand to the Developer with respect to the commencement, completion, or
cessation in the construction of the Improvements, the City shall at the same time deliver to the
applicable Holder who has provided written notice to the City specifying its name and address, a
copy of such notice or demand. Each such Holder shall (insofar as the rights of the City are
concerned) have the right, but not the obligation, at its option, to cure or remedy or commence to
cure or remedy any such default or breach and to add the cost thereof to the applicable Approved
Security Interest debt and the lien on its Approved Security Interest.
Nothing contained in this Agreement shall be deemed to permit or authorize such Holder
to undertake or continue the construction or completion of the Improvements, as applicable
(beyond the extent necessary to conserve or protect such improvements or construction already
made) without first having expressly assumed in writing the Developer's obligations to the City
relating to the Improvements as applicable under this Agreement. The Holder in that event must
agree to complete, in the manner provided in this, Agreement, the Improvements, as applicable.
Any Holder properly completing the Improvements pursuant to this paragraph shall assume all
rights and obligations of Developer under this Agreement and shall be entitled, upon written
request made to the City, to a Certificate of Completion for the Improvements, as applicable,
from the City.
Section 7.5 Failure of Holder to Complete Improvements
In any case where, having exercised its option to construct the Improvements, a Holder
has not proceeded diligently with construction in accordance with the provisions set forth in
Article 5, the City shall be afforded those rights against Holder that the City would otherwise
have against the Developer under this Agreement. In the event that the Holder, with consent of
the City, conveys or otherwise transfers its interest in the Property, it shall thereafter be relieved
of any and all liability arising under this Agreem .-nt.
Section 7.6 Right of Cily t Cure
In the event of a default or breach by the :Developer of an Approved Security Interest
prior to the completion of construction, and the Holder has not exercised its option to complete
the construction called for, the City may cure the default, upon receipt of a copy of a notice of
default or upon discovery by the City that a Holder intends to foreclose, prior to the completion
of any foreclosure. In such event, the City shall have the first right of refusal to purchase the
loan from the Holder prior to foreclosure or acceptance of a deed in lieu of foreclosure at a
purchase price equal to the amount required to repay, in full, all remaining indebtedness and
obligations of the Developer to the Holder, with respect to the Approved Security Interest that is
in default, including but not limited to all principal, accrued interest, and any interest fees or
costs incurred by the Developer by reason of such default, foreclosure, or transfer in lieu of
foreclosure. Any Approved Security Interest shall include provisions requiring Holder to
provide the City with a copy of any notice of default at the same time such notice is provided to
the Developer, and shall afford the City an opportunity to cure any default within the same time
period allotted the Developer, plus an additional - ten (10) days.
Section 7.7 Right of City io Satisfy Other Liens
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Prior to the recordation of a Certificate of Completion, and after the Developer has had a
reasonable time to challenge, cure or satisfy any liens or encumbrances on the Property or any
portion thereof, the City shall have the right to satisfy any such lien or encumbrances and receive
reimbursement from the Developer; provided, however, that nothing in this Agreement shall
require the Developer to pay or make provision for the payment of any tax, assessment, lien or
charge so long as the Developer in good faith shall contest the validity or amount therein and so
long as such delay in payment shall not subject the Property or any portion thereof to forfeiture
or sale.
ARTICLE 8
ASSIGNMENT AND TRANSFERS
Section 8.1 Definitions
As used in this Article 8, the term "Transfer" means:
(a) Any total or partial sale, assignment or conveyance, or any trust or power,
or any transfer in any other mode or form, of or with respect to this Agreement or of the
Development or any part thereof or any interest therein or any contract or agreement to do any of
the same; or
(b) Any total or partial sale, assignment or conveyance, or any trust or power,
or any transfer in any other mode or form, of or with respect to any ownership interest in
Developer or any contract or agreement to do any of the same; or
(c) Any merger, consolidation, sale or lease of all or substantially all of the
assets of Developer; or
(d) The leasing of part or all of the Property or the improvements thereon;
provided, however, that transfer of the Homes to the Eligible Purchasers shall not be deemed a
"Transfer" for purposes of this Article 8.
Section 8.2 Purpose of Restrictions on Transfer
This Agreement is entered into solely for the purpose of development of the
Improvements and the subsequent use in accordance with the terms hereof. The Developer
recognizes that the qualifications and identity of Developer are of particular concern to the City,
in view of
(a) The importance of the development of the Property to the general welfare
of the community;
(b) The land acquisition assistance and other public aids that have been made
available by law and by the City for the purpose of making such development possible;
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(c) The reliance by the City upon the unique qualifications and ability of the
Developer to serve as the catalyst for development of the Property;
(d) The fact that a change in ownership or control of the owner of the
Property, or of a substantial part thereof, or any other act or transaction involving or resulting in
a significant change in ownership or with respect to the identity of the parties in control of the
Developer or the degree thereof is for practical purposes a transfer or disposition of the Property;
(e) The fact that the Property is not to be acquired or used for speculation, but
only for development by the Developer in accordance with the Agreement; and
(f) The Developer further recognizes that it is because of such qualifications
and identity that the City is entering into this Agreement with the Developer and that Transfers
are permitted only as provided in this Agreement:.
Section 8.3 Prohibited Transfers
The limitations on Transfers set forth in this Article 8 shall apply until the initial sale of
each Home to an Eligible Purchaser. Except as expressly permitted in this Agreement, the
Developer represents and agrees that the Developer has not made or created, and will not make
or create or suffer to be made or created, any Transfer, either voluntarily or by operation of law
without the prior written approval of the City.
Any Transfer made in contravention of this section shall be void and shall be deemed to
be a default under this Agreement whether or not the Developer knew of or participated in such
Transfer.
Section 8.4 Permitted Transfers
Notwithstanding the provisions of Section 8.3, the following Transfers shall be permitted
and are hereby approved by the City.
(a) Any Transfer creating an Approved Security Interest; and
(b) Any Transfer directly resulting from the foreclosure of an Approved
Security Interest or the granting of a deed in lieu of foreclosure of an Approved Security Interest
or as otherwise permitted under Article 7.
Section 8.5 Effectuation of Certain Permitted Transfers
The City may, in its sole discretion, approve in writing other Transfers as requested by
the Developer. In connection with such request, there shall be submitted to the City for review
all instruments and other legal documents proposed to effect any such Transfer. If a requested
Transfer is approved by the City such approval shall be indicated to the Developer in writing.
Such approval shall be granted or denied by the City within thirty (30) days of receipt by the City
of Developer's request for approval of a Transfer.
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No Transfer of this Agreement permitted pursuant to this section shall be effective unless,
at the time of the Transfer, the person or entity to which such Transfer is made, by an instrument
in writing reasonably satisfactory to the City and in form recordable among the land records,
shall expressly assume the obligations of the Developer under this Agreement and agree to be
subject to the conditions and restrictions to which the Developer is subject arising during this
Agreement, to the fullest extent that such obligations are applicable to the particular portion of or
interest in the Development conveyed in such Transfer. The holder of an Approved Security
Interest whose interest shall have been acquired by, through or under an Approved Security
Interest or shall have been derived immediately from any holder thereof shall not be required to
give to City such written assumption until such holder or other person is in possession of the
Property or entitled to possession thereof pursuant to enforcement of the Approved Security
Interest.
In the absence of specific written agreement by the City, no such Transfer, assignment or
approval by the City shall be deemed to relieve the Developer or any other party from any
obligations under this Agreement.
Section 8.6 Special Remedy for Prohibited Transfer
In the event that in violation of the provisions of this Agreement, the Developer
undertakes a prohibited Transfer, the City shall be entitled to increase the purchase price paid by
the Developer for the Property previously conveyed from the City to Developer. The amount of
the increase shall be in the amount that the consideration payable for such assignment or transfer
is in excess of the sum of (a) the purchase price paid by the Developer to City for the Property
and (b) the costs of subsequent improvements and development, including carrying charges,
interests and fees, transfer taxes, real estate taxes, assessments and commissions, escrow fees and
costs related thereto. The consideration payable for such assignment or transfer to the extent it is
in excess of the amount so authorized, shall belong and be paid to the City and until so paid, the
City shall have a lien on the Property for such amount. The rights and protections of holders of
Approved Security Interests set forth in Article 7 shall also apply to this section.
ARTICLE 9
DEFAULT, REMEDIES AND TERMINATION
Section 9.1 No Fault of Parties
The following events constitute a basis for a party to terminate this Agreement without
the fault of the other:
(a) The Developer or City determines, following a hazardous materials
investigation pursuant to Section 2.2 of this Agreement, that Hazardous Materials are present on
the Property through no fault of the Developer such that in the reasonable determination of the
Developer and the City, the Property is not suitable for the use to which it is required to be put
under this Agreement or remediation of such Hazardous Materials is prohibitively expensive;
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(b) If pursuant to Section 2.3, the City is unable to approve the Development
after completion of CEQA review for the Development or if designated mitigation measures are
prohibitively expensive in the reasonable determination of the City and Developer;
(c) If the Developer does not secure City approval of any change to the
Concept Plan after a second submittal of such revised Concept Plan pursuant to Section 2.5;
(d) There is a final judgment of a court of competent jurisdiction rendering
this Agreement invalid or prohibiting the City from performing one or more of its respective
obligations under this Agreement; or
(e) The Developer, despite ga od faith and best efforts, is unable to obtain all
permits, or land use or government approvals necessary to construct the Improvements within the
time and in the manner specified in Sections 2.4 and 2.7.
Upon the happening of any of the above described events, the City and the Developer shall
confer in good faith for a period not to exceed thirty (30) days to determine if there is a feasible
and mutually acceptable alternate arrangement can be made to alleviate the basis for a party to
terminate this Agreement. If no agreement is reached by the parties within such thirty (30) -day
period regarding the alternative courses of action to alleviate the basis for termination of this
Agreement, this Agreement may be terminated at the election of either party. Termination shall
be effected by the terminating party giving written notice to the other party of termination and
the reason(s) therefore. After termination, neither party shall have any rights against or liability
to the other under this Agreement, except as follows: (i) the indemnification and waiver
provisions set forth in Sections 2.2, 3.6, 5.5, 5.8 and 10.7 of this Agreement shall survive such
termination; and (ii) the parties shall implement the provisions of Section 9.7.
Section 9.2 Fault of City
Except as to events constituting a basis fOT termination under Section 9. 1, the following
events each constitute a basis for the Developer to take action against the City:
(a) The City without good cause fails to convey the Property to the Developer
within the manner and form herein called for and the Developer is otherwise entitled by this
Agreement to such action or conveyance; or
(b) The City breaches any other material provisions of this Agreement.
Upon the happening of any of the above - described events, the Developer shall first notify
the City in writing of its purported breach or failure, giving the City thirty (30) days from receipt
of such notice to cure such breach or failure. In 1he event City does not then cure the noticed
default within thirty (30) days (or with respect to a default that cannot reasonably be cured within
thirty (30) days, the City does not commence to cure such default within such thirty (30) day
period or does not thereafter diligently pursue such cure to completion and in all events complete
such cure within ninety (90) days), the Developer shall be entitled to all of its rights in law or in
equity, including without limitation, enforcement: of obligations through specific performance or
payment of damages.
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24
Section 9.3 Fault of Developer
Except as to events constituting a basis for termination pursuant to Section 9. 1, the
following events shall each constitute a basis for the City to take action against the Developer:
(a) The Developer fails to exercise good faith and best efforts to satisfy,
within the time and in the manner set forth in Article 2, one or more of the conditions precedent
to the City's obligation to convey the Property to the Developer; or
(b) The Developer without good cause refuses to accept conveyance from the
City of the Property within the time periods and under the terms set forth in Article 3; or
(c) The Developer constructs or attempts to construct the Improvements in
violation of Article 5; or
(d) After satisfaction of all preconditions thereto, the Developer fails to
commence or complete construction of the Improvements within the times set forth in Article 5,
or abandons or suspends construction of the Improvements prior to completion of all
construction for a period of thirty (30) days after written notice by the City of such abandonment
or suspension; or
(e) The Developer fails to comply with any material obligation or requirement
set forth in Article 5; or
Article 8; or
(f) A Transfer occurs, either voluntarily or involuntarily, in violation of
(g) Any representation or warranty contained in this Agreement or in any
application, financial statement, certificate or report submitted by Developer (but excluding any
materials provided by prospective buyers of the Homes) to the City in connection with this
Agreement proves to have been incorrect in any material and adverse respect when made; or
(h) A court having jurisdiction shall have made or entered any decree or order
(1) adjudging the Developer to be bankrupt or insolvent, (2) approving as properly filed a
petition seeking reorganization of the Developer or seeking any arrangement for the Developer
under the bankruptcy law or any other applicable debtor's relief law or statute of the United
States or any state or other jurisdiction, (3) appointing a receiver, trustee, liquidator, or assignee
of the Developer in bankruptcy or insolvency or for any of their properties, or (4) directing the
winding up or liquidation of the Developer, if any such decree or order described in clauses (1)
to (4), inclusive, shall have continued unstayed or undischarged for a period of sixty (60) days
unless a lesser time period is permitted for cure under any other mortgage on the Property, in
which event such lesser time period will apply under this subsection (i) as well; or the Developer
shall have admitted in writing its inability to pay its debts as they fall due or shall have
voluntarily submitted to or filed a petition seeking any decree or order of the nature described in
clauses (1) to (4), inclusive; or
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25
(i) The Developer shall have assigned its assets for the benefit of its creditors
or suffered a sequestration or attachment of or execution on any substantial part of its properly,
unless the properly so assigned, sequestered, attached or executed upon shall have been returned
or released within sixty (60) days after such event (unless a lesser time period is permitted for
cure under any other mortgage on the Property, in which event such lesser time period shall
apply under this subsection 0) as well) or prior to sooner sale pursuant to such sequestration,
attachment, or execution. In the event that the Developer is diligently working to obtain a return
or release of the property and the City's interests under the City Documents are not immediately
threatened, in the City's reasonable business judgment, the City shall not declare a default under
this subsection; or
0) The Developer shall have voluntarily suspended its business or, if the
Developer is a partnership, the partnership shall have been dissolved or terminated; or
(k) There shall occur any default declared by any lender under any loan
document related to any loans secured by a deed of trust on the Development, subject to
applicable notice and cure periods, if any, set forth in such loan document; or
(1) The Developer breaches any other material provision of this Agreement or
any other City Document.
Upon the happening of any of the above - described events, the City shall first notify the
Developer in writing of its purported breach, failure or act above described, giving the Developer
thirty (30) days from receipt of such notice to cure, or, if cure cannot be accomplished within
said thirty (30) days, to commence to cure such breach, failure, or act. In the event the
Developer fails to cure within said thirty (30) days, or if such breach is of a nature that it cannot
be cured within thirty (30) days, Developer fails to commence to cure within said thirty (30) days
and diligently complete such cure within a reasoriable time thereafter but in no event later than
ninety (90) days, then the City shall be afforded all. of its rights .at law or in equity by taking any
or all of the following remedies:
(i) Termination of this Agreement by written notice to the Developer;
provided, however, that the City's remedies pursuant to this Article 9 or any other City
Document and the indemnification provisions of Sections 2.2, 5.5, 5.8 and 10.7 and the waiver
provisions of Sections 2.2 and 3.6 shall survive such termination;
(ii) Prosecuting an action for damages or specific performance; and
(iii) Any of the remedies specified in Sections 9.4, 9.5, 9.6 or 9.7.
Notwithstanding the notice and cure periods set forth above, if a lesser cure period or
notice requirement is allowed before a default occurs under any other City Document, such
periods shall control in this Agreement as well.
Section 94 Right of Reve rter.
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In the event that following close of Escrow this Agreement is terminated pursuant to
Section 9.3 and such termination occurs prior to issuance of the Certificate of Completion, then
the City shall have the right to reenter and take possession of the portion of the Property for
which a Certificate of Completion has not been issued and all improvements thereon.
The Developer shall execute any document necessary to convey its interest in the
Property and the Improvements to the City, pursuant to the terms of this Section 9.4.
The City shall promptly use its best efforts to sell the Property and the Improvements
consistent with the purpose of the Agreement and its obligations under state law. Upon sale the
proceeds shall be applied as follows:
(a) First, to reimburse the City for any costs it incurs in selling the Property
and the Improvements including but not limited to amounts to discharge or prevent liens or
encumbrances arising from any acts or omissions of the Developer.
(b) Second, to reimburse the City for damages to which it is entitled under this
Agreement by reason of the Developer's default.
(c) Third, to the Developer, the reasonable cost of the portion of the
Improvements the Developer has placed on the Property prior to reversion to the City.
(d) Fourth, any balance to the City.
The rights granted in this Section 9.4 shall be subject to and be limited by and shall not
defeat, render invalid, or limit:
(i) Any Approved Security Interest permitted by this Agreement.
(ii) Any rights or interests provided in this Agreement for the protection of the
holder of such Approved Security Interests.
Section 9.5 Right to Cure at Developer's Expense
The City shall have the right to cure any monetary default by the Developer under a loan
in connection with the Development, if any; provided, however, that if the Developer is in good
faith contesting a claim of default under a loan and the City's interest under the City Documents
are not imminently threatened by such default, in the City's sole judgment, the City shall not
have the right to cure such default. The Developer agrees to reimburse the City for any funds
advanced by the City to cure a monetary default by Developer upon demand therefore, together
with interest thereon at the lesser of the rate of ten percent (10 %) per annum or the maximum
rate permitted by law from the date of expenditure until the date of reimbursement.
Section 9.6 Construction Plans
If this Agreement is terminated pursuant to Section 9.1 or 9.3, the Developer, within five
(5) business days of the written request of the City, shall deliver to the City, at no cost to the
City, copies of any studies related to the Property and any construction plans in the Developer's
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possession or to which the Developer is entitled for development of the Improvements, if City
funds were used to prepare such studies, reports or plans. If the City wants any studies, reports
or plans originally paid for by other than City funds, City shall reimburse Developer for the costs
of reproduction.
ARTICLE 10
GENERAL PROVISIONS
Section 10.1 Notices, Demands and Communications
Formal notices, demands, and communications between the City and the Developer shall
be sufficiently given if and shall not be deemed given unless dispatched by registered or certified
mail, postage prepaid, return receipt requested or delivered personally, or by express delivery
service to the principal office of the City and the Developer as follows:
City:
CITY OF CUPERTINO
10300 Torre Avenue
Cupertino, California 95014
Attention: City Manager
Developer:
HABITAT FOR HUMANITY SILICON VALLEY
513 Valley Way
Milpitas, CA 95035
Attention: Executive Director
Such written notices, demands and communications shall be deemed delivered upon receipt, and
may be sent in the same manner to such other addresses as the affected parry may from time to
time designate by mail as provided in this Section 10.1.
If the deadline for any notice, communication, or approval pursuant to this Agreement
falls on a Friday, Saturday, or Sunday, the deadline date shall be extended to the subsequent
Monday.
Section 10.2 Non - Liability of City Officials, Employees and Agents
No member, official, employee or agent of the City shall be personally liable to the
Developer, or any successor in interest, in the event of any default or breach by the City or for
any amount which may become due to the Developer or successor or on any obligation under the
terms of this Agreement.
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Section 10.3 Enforced Delay
In addition to specific provisions of this Agreement, performance by either party
hereunder shall not be deemed to be in default where delays or defaults are due to war;
insurrection; strikes; lock -outs; riots; floods; earthquakes; fires; casualties; acts of the public
enemy; epidemics; quarantine restrictions; freight embargoes; governmental restrictions or
priority; litigation (including suits filed by third parties concerning or arising out of this
Agreement); or weather or soils conditions which, in the opinion of the Developer's contractor,
will necessitate delays. An extension of time for any cause will be deemed granted if notice by
the party claiming such extension is sent to the other within ten (10) days from the
commencement of the cause, which extension shall be limited to a time reasonably related to the
cause, and in no event be more than ninety (90) days. Times of performance under this
Agreement may also be extended in writing by mutual agreement of the City and the Developer.
Section 10.4 Inspection of Books and Records
Upon request, the Developer shall permit the City to inspect at reasonable times and on a
confidential basis those books, records and all other documents of the Developer necessary to
determine the Developer's compliance with the terms of this Agreement. The Developer also has
the right at all reasonable times to inspect the books, records and all other documentation of the
City pertaining to its obligations under this Agreement. The right of inspection includes the right
to make extracts and copies.
Section 10.5 Provision Not Merged with Deed
None of the provisions of this Agreement are intended to or shall be merged by any grant
deed transferring title to any real property the subject of this Agreement from the City to the
Developer or any successor in interest, and any such grant deed shall not be deemed to affect or
impair the provisions and covenants of this Agreement.
Section 10.6 Title of Parts and Sections
Any titles of the Parts, Sections or Subsections of this Agreement are inserted for
convenience of reference only and shall be disregarded in constructing or interpreting any part of
its provision.
Section 10.7 Indemnification
The Developer agrees to indemnify, protect, hold harmless and defend (by counsel
reasonably satisfactory to the City) the City and the City, and their respective officers, officials,
employees, agents and volunteers, from all suits, actions, claims, causes of action, costs,
demands, judgments and liens from third parties arising out of the Developer's breach of any of
the City Documents, or any other agreement executed pursuant to the City Documents, except to
the extent caused by the City's or City's willful misconduct or gross negligence or breach of this
Agreement or any agreements executed pursuant hereto. The provisions of this Section shall
survive expiration of the Term or other termination of this Agreement, and shall remain in full
force and effect. The City and the Developer agree that if pursuant to the terms of this
Agreement, the Agreement is terminated under Section 9. 1, the Developer's failure to develop
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the Development shall not be considered non - performance under the Agreement for the purposes
of this section.
Section 10.8 Rights and Remedies Cumulative
Except as otherwise expressly stated in this Agreement, the rights and remedies of the
parties are cumulative, and the exercise or failure to exercise one or more of such rights or
remedies by either party shall not preclude the exercise by it, at the same time or different times,
of any right or remedy for the same default or any other default by the other party.
Section 10.9 Applicable La w.
This Agreement shall be interpreted under and pursuant to the laws of the State of
California.
Section 10.10 Severability
If any term, provision, covenant or condition of this Agreement is held by a court of
competent jurisdiction to be invalid, void or unenforceable, the remainder of the provisions shall
continue in full force and effect unless the rights and obligations of the parties have been
materially altered or abridged by such invalidation, voiding or unenforceability.
Section 10.11 Legal Actions
In the event any legal action is commenced to interpret or to enforce the terms of this
Agreement or to collect damages as a result of any breach thereof, the party prevailing in any
such action shall be entitled to recover against the party not prevailing all reasonable attorney's
fees and costs incurred in such action.
Section 10.12 Binding Upon Successors
This Agreement shall be binding upon and inure to the benefit of the heirs,
administrators, executors, successors in interest and assigns of each of the parties hereto except
that there shall be no transfer of any interest by the Developer except pursuant to the terms of
this Agreement. Any reference in this Agreement to a specifically named party shall be deemed
to apply to any successor, heir, administrator, executor or assign of such party who has acquired
an interest in compliance with the terms of this Agreement, or under law.
Section 10.13 Parties Not Co- Venturers
Nothing in this Agreement is intended to or does establish the parties as partners, co-
venturers, or principal and agent with one another.
Section 10.14 Warranties
The City expresses no warranty or representation to the Developer as to fitness or
condition of the Property for the building or construction to be conducted thereon.
- 21-33
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30
Section 10.15 Time of the Essence
In all matters under this Agreement, the parties agree that time is of the essence.
Section 10.16 Action by the City
Except as may be otherwise specifically provided herein, whenever any approval, notice,
direction, consent, request, or other action by the City is required or permitted under this.
Agreement, such action may be given, made, or taken by the City Manager or by his designee,
without further approval by the City's Council, and any such action shall be in writing.
The City Manager is authorized to make nonmaterial amendments and technical
corrections to this Agreement, including the exhibits to this Agreement.
Section 10.17 Waiver of Terms and Conditions
The City Manager may at his or her discretion waive in writing any of the terms and
conditions of this Agreement, or the other City Documents, without the Developer completing an
amendment to this Agreement. The City Manager may also at his or her discretion agree to
extension of any time deadline set forth in this Agreement for up to ninety (90) days. No waiver
of any default or breach by the Developer or of the City, as applicable, hereunder shall be
implied from any omission by the City or the Developer, as applicable, to take action on account
of such default if such default persists or is repeated, and no express waiver shall affect any
default other than the default specified in the waiver, and such waiver shall be operative only for
the time and to the extent therein stated. Waivers of any covenant, term, or condition contained
herein shall not be construed as a waiver of any subsequent breach of the same covenant, term,
or condition. The consent or approval by the City to or of any act by the Developer requiring
further consent or approval shall not be deemed to waive or render unnecessary the consent or
approval to or of any subsequent similar act. The exercise of any right, power, or remedy shall
in no event constitute a cure or a waiver of any default under this Agreement or the City
Documents, nor shall it invalidate any act done pursuant to notice of default, or prejudice the
City in the exercise of any right, power, or remedy hereunder or under the City Documents,
unless in the exercise of any such right, power, or remedy all obligations of the Developers to
City are paid and discharged in full.
Section 10.18 Identity and Authority of the Developer
The persons executing this Agreement on behalf of the Developer do hereby covenant
and warrant: that the Developer is a duly formed and existing California nonprofit public benefit
corporation; that the Developer has, is and shall remain in good stapding and qualified to do
business in the State of California; that the Developer has full right, power and authority to enter
into this Agreement and to carry out all actions on its part contemplated by this Agreement; that
the execution and delivery of this Agreement were duly authorized by proper corporate actions
of the Developer and no consent, authorization or approval of the Developer's Board members or
any person is necessary in connection with such execution and delivery or to carry out all actions
on the Developer's part contemplated by this Agreement, except as have been obtained and are in
full force and effect; that the persons executing this Agreement on behalf of the Developer have
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423 -10 31
full authority to do so; and that this Agreement constitutes the valid, binding and enforceable
obligation of the Developer.
Section 10.19 Recordation
The City shall cause this Agreement or a memorandum of this Agreement to be recorded
against the Property in the records of the County Recorder of the County of Santa Clara. The
Developer consents to, and shall cooperate as necessary in, such recording.
Section 10.20 Counters ,end Complete Understanding of the Parties
This Agreement may be executed in counterparts, each of which is deemed to be an
original. This Agreement and attached Exhibits constitute the entire understanding and
agreement of the parties.
written
WHEREFORE, the parties have executed this Agreement on or as of the date first above
THE CITY OF CUPERTINO,
a municipal corporation
LM
Its: City Manager
DFVELOPER
HABITAT FOR HUMANITY, SILICON
VALLEY, a California nonprofit public benefit
corporation
L
Its:
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4 -23-10
32
EXHIBIT A
LEGAL DESCRIPTION OF CLEO AVENUE PROPERTY
Real property in the City of Cupertino, County of Santa Clara, State of California, described as
follows:
APN: 362-01-004
A -1 21 -36
EXHIBIT B
DEVELOPME14T SCHEDULE
This Development Schedule summarizes the schedule for various activities under the
Disposition and Development Agreement ( "DDA ") to which this exhibit is attached. The
description of items in this Development Schedule is meant to be descriptive only, and shall not
be deemed to modify in any way the provisions of the DDA to which such items relate. Section
references herein to the DDA are intended merely as an aid in relating this Development
Schedule to other provisions of the DDA and shall not be deemed to have any substantive effect.
Whenever this Development Schedule requires the submission of plans or other
documents at a specific time, such plans or other documents, as submitted, shall be complete and
adequate for review by the City or other applicable governmental entity within the time set forth
herein. Prior to the time set forth for each particular submission, the Developer shall consult
with City staff informally as necessary concerning such submission in order to assure that such
submission will be complete and in a proper form within the time for submission set forth herein.
Action Date
These Items Relate to Actions and Requirements Prior to the Conveyance of the Property
as Set Forth in Article 2 of the DDA.
CEQA Review CEQA review of
No later than 60 days after date of DDA.
Development to be completed. [DDLA § 2.3]
Site Investi ag tion Developer may investigate
By the date 90 days after the date of the DDA.
Property conditions. [DDLA § 2.2]
Applicable Land Use Approvals The
Developer applied for prior to date of DDA
Developer shall apply for and obtain the
and will diligently pursue issuance before close
applicable Land Use Approvals necessary for
of escrow.
the construction of the Improvements.
[DDA § 2.4]
Design Concept The Developer shall submit
Submitted and City approved prior to date of
any changes to the proposed concept for the
DDA.
Improvements for City approval.
[DDLA § 2.5]
Construction Plans The Developer shall
Within 90 days following the date of DDA.
submit proposed Construction Plans for the
Improvements. [DDA § 2.6]
B -1
21 -37
Action
Date
Building Permit The Developer shall apply
Within 120 days following the date of DDA.
for the Building Permit for construction of the
Improvements. [DDA § 2.7]
Construction Contract The Developer shall
Within 10 days after the issuance of the
submit for City approval any applicable
Building Permit for site work and within 60
subcontracts for the construction of the
days of the date of the DDA for any other
Improvements.
applicable trades.
IDDA § 2.9]
Insurance The Developer shall submit
No later than close of escrow.
evidence of insurance to the City.
[DDA § 5.7]
Payment and Performance Bonds The
Prior to the close of escrow.
Developer shall submit to the City payment
and performance bonds for the Improvements.
[DDA § 2.8]
These Items Relate to the Conveyance of the Property and the Developer's Construction of
the Improvements as Set Forth in Articles 3 and 5.
Closing. Property shall be transferred to
No later than , provided
Developer by the City. [DDA § 3.4]
the conditions to conveyance of the Property
set forth in Article 2 have been satisfied.
Commencement of Construction The
No later than 30 days after the close of escrow.
Developer shall commence construction of the
Improvements. [DDA § 5.2]
Completion of Construction The Developer
Within 18 months after commencement of
shall complete construction of the
construction.
Improvements. DDA § 5.2
B -2
21-38
EXHIBIT C
FORM OF CERTIFICATE OF COMPLETION
Recording Requested By
And When Recorded Mail To:
Habitat for Humanity Silicon Valley
513 Valley Way
Milpitas, CA 95035
Attn: Executive Director
CERTIFICATE OF COMPLETION
Pursuant to Section 5.6 of the Disposition and Development Agreement (the
"Agreement "), dated as of 200_, by and between the City of Cupertino, a
municipal corporation ( "City "), and Habitat for Humanity Silicon Valley, Inc, a California
nonprofit public benefit corporation (the "Developer "), the City certifies that the Developer has
met its construction obligations under Article 5 of the Agreement. This Certificate of
Completion: (1) shall not constitute evidence of compliance with or satisfaction of any obligation
of the Developer to any holder of a deed of trust securing loaned to finance the Improvements
(as defined in the Agreement) or any part thereof; (2) shall not constitute evidence of compliance
with the prevailing wage requirements of California Labor Code Sections 1720 et seq.; and (3)
shall not be deemed either a notice of completion under the California Civil Code or a certificate
of occupancy.
CITY OF CUPERTINO
Its:
Date:
C -- 1
21 -39
I0:lal3��
INSURANCE REQUIREMENTS
Developer shall procure and maintain for the duration of the Insurance Period insurance
against claims for injuries to persons or damages to property which may arise from or in
connection with the performance of the work hereunder by the Developer, its contractors,
subcontractors, agents, representatives and employees. Unless otherwise expressly approved in
writing by the City, such insurance shall conform with the following specifications:
MINIMUM SCOPE OF INSURANCE:
Coverage shall be at least as broad as:
1. Insurance Services Office Commercial General Liability coverage (occurrence
form CG 0001).
2. Insurance Services Office Form (G0009 11 88 Owners and Contractors Protective
Liability Coverage Form — Coverage for Operations of Designated Contractor).
2. Insurance Services Office Form Number CA 0001 covering Automobile Liability,
code 1 (any auto).
3. Workers' Compensation insurance as required by the State of California and
Employer's Liability Insurance.
4. Course of Construction insurance providing coverage for "all risks" of loss.
MINIMUM LIMITS OF INSURANCE:
The Developer shall maintain limits no less than:
1. General Liability (including operations, products and completed operations):
$2,000,000 per occurrence for bodily injury, personal injury and property damage.
If Commercial General Liability Insurance or other form with a general aggregate
limit is used, either the general aggregate limit shall apply separately to this
project/location or the general aggregate limit shall be twice the required
occurrence limit.
2. Automobile Liability: $1,000,000 per accident for bodily injury and property
damage.
3. Employer's Liability: $1,000,000 per accident for bodily injury or death.
4. Course of Construction: Completed value of the project with no coinsurance
penalty provisions
DEDUCTIBLES AND SELF - INSURED RETENTIONS:
Any deductibles or self - insured retentions must be declared to and approved by the City.
At the option of the City, either the insurer shall reduce or eliminate such deductibles or self-
21 -40
insured retentions as respects the City and the City, their respective officers, officials,
employees, agents and volunteers, or the Developer shall provide a financial guarantee
satisfactory to the City guaranteeing payment of losses and related investigations, claim
administration and defense expenses.
OTHER INSURANCE PROVISIONS:
The general liability and automobile liability policies are to contain, or be endorsed to
contain. the following provisions:
1. The City and the City, and their respective officers, officials, employees, agents
and volunteers are to be covered as insureds with respect to liability arising out of
work or operations performed by or on behalf of the Developer including
materials, parts or equipment furnished in connection with such work or
operations and with respect to liability arising out of automobiles owned, leased,
hired or borrowed by or on behalf of the Developer. General liability coverage
can be provided in the form of an endorsement to the Developer's insurance
policy, or as a separate owner's policy.
2. For any claims related to this project, the Developer's insurance coverage shall be
primary insurance as respects the City and the City, and their respective officers,
officials, employees, agents and volunteers. Any insurance or self-insurance
maintained by the City or the City, or their respective officers, officials,
employees, agents or volunteers shall be excess of the Developer's insurance and
shall not contribute with it.
3. Any failure to comply with reporting or other provisions of the policies including
breaches of warranties shall not affect coverage provided to the City and the City,
and their respective officers, officials, employees, agents or volunteers.
4. The Contractor's insurance shall apply separately to each insured against whom
claim is made or suit is brought, except with respect to the limits of the insurer's
liability.
5. Each insurance policy required by this clause shall be endorsed to state that
coverage shall not be suspended, voided, cancelled by either party, reduced in
coverage or in limits except after thirty (30) days' prior written notice by certified
mail, return receipt requested, has been given to the City.
6. Course of construction insurance ;3hall name the City and the City as loss payees,
as their respective interests may appear, and shall include a waiver of all rights of
subrogation against the City and the City.
ACCEPTABILITY OF INSURERS:
Insurance is to be placed with insurers with a current A.M. Best's rating of no less than
A:VII, unless otherwise acceptable to the City.
21-41
VERIFICATION OF COVERAGE:
The Developer shall furnish the City with original certificates of insurance or
endorsements evidencing coverage required by these specifications. The certificates or
endorsements are to be signed by a person authorized by that insurer to bind coverage on its
behalf. The certificates or endorsements are to be in form and substance satisfactory to the City
and shall be received and approved by the City before work commences. At the request of the
City, the Developer shall provide complete, certified copies of all required insurance policies,
including endorsements affecting the coverage required by these specifications.
21-42
EXHIBITS
BEGIN
HERE
Agenda Item: 21
June 1, 2010
Two proposed minor changes to the DDA:
1. Any reference to using City funding for mortgage assistance will change to predevelopment
costs as defined by the CDBG regulations.
2. Add the following language to Section 5.2 on page 13 of the DDA: "If construction is delayed
due to an unforeseeable or unanticipated reason, the parties may mutually agree upon an
extension of time. Any extension of time shall be reflected in writing."