97-073 SNK Arioso LP, foundation deposit agreement •
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FOUNDATION DEPOSIT AGREEMENT
THIS FOUNDATION DEPOSIT AGREEMENT(the "Agreement") is made and
entered into as of September 15, 1997,by and among SNK ARIOSO LP, a Delaware limited
partnership ("Developer")and the City of Cupertino, a municipal corporation of the State of
California (the "City").
RECITALS
A. Developer is the owner of Lots 2, 3 and 12(the"Apartment Parcels") of Tract
8980 recorded in Book 694of Maps at pages 4 through 7 . The Apartment
Parcels are located in the City of Cupertino, County of Santa Clara, State of California.
B. Developer proposes to construct a 201 unit apartment project("Apartment
Project") on the Apartment Parcels in accordance with the plans and specifications for the
project which have been submitted to the City for approval, as the same may later be modified.
C. In connection with the approvals of a tentative map (application 8-TM-96),a use
permit(Use Permit Application No. 15-U-96) and an application amending a condition for
approval for application No. 6-Z-96 (Application 6-Z-96 (Mod.))the City has approved a
phasing condition (the"Phasing Condition")the text of which is attached hereto as Exhibit A
pages 1 through 6, inclusive.
D. The Phasing Condition becomes effective only upon the City's approval, prior to
the second reading of Ordinance 1764 amending 6-Z-96,of a fully executed Hilton standard
form license agreement(the"License Agreement") which specifically provides that all
conditions(with the exception of the completion of the purchase of the subject property)
described in Hilton's letter to Peter Pau dated May 12, 1997 have been fulfilled. The License is
to be reviewed by the City Attorney and approved by the City Council before this condition
becomes effective.
1 103472.2
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E. The City Attorney reviewed the License on September 15, 1997 and the City
Council approved the License on September 15, 1997 prior to the second reading of Ordinance
1764 amending 6-Z-96 on the same date. Therefore the phasing condition attached hereto as
Exhibit A is effective.
F. The Phasing Condition provides that,in order to ensure that the construction of a
hotel (the"Hotel") on Lot 1 (the"Hotel Parcel")of Tract 8980 is initiated in a timely fashion,
the commencement of its construction shall occur prior to, or simultaneously with,the issuance
of building permits for the Apartment Project on the Apartment Parcels.
G. The Phasing Condition also provides that"commencement of construction"
means : 1) all plans for the construction of the Hotel (foundations and structure)must be
submitted to, and approved by the City and 2) all foundations for the Hotel (including the
installation of footings, and first floor slab)must be completed and inspected by the City.
H. The Phasing Condition further states that if the commencement of construction of
the Hotel has not occurred when the Developer requests issuance of building permits for any
multi-family residential units on the Apartment Parcels,then the Developer may elect to proceed
with construction of said units,prior to the commencement of construction of the Hotel,by
tendering the sum of$1,000,000 to the City.
I. This Agreement sets forth the procedures for tender,retention and return of said
sum.
NOW THEREFORE,in consideration of the foregoing and of the mutual covenants
hereinafter set forth,the parties hereto agree as follows:
1. Deposits With the City. If commencement of construction, as defined in the.
Phasing Condition, of the Hotel has not occurred when the Developer requests issuance of
building permits for the Apartment Project and if all other conditions and requirements for
issuance of building permits for the Apartment Project have then occurred,then Developer may
2 103472.2
deposit the sum of$1,000,000 with the City Treasurer by delivering to the person authorized to
issue building permits a certified or bank cashier's check for such sum payable to the City of
Cupertino and,upon delivering such check,the building permits for the Apartment Project shall
be issued provided that all other requirements for their issuance have been satisfied. The City
agrees not to accept the Deposit unless all requirements for issuance of the building permits for
the Apartment Project have occurred.
2. Investment of Deposit. During the term of this Agreement,the Deposit shall be
invested by the City in such short term investments in which the City invests other funds from
time to time. Any interest on the Deposit will be payable to the Developer if the Deposit is
returned to the Developer. If the Deposit is not returned to the Developer,then any interest
thereon shall be retained by the City. The City shall have the right to liquidate any investments
held in order to provide funds necessary to make required payments hereunder. The City shall
not have any liability for any loss sustained as a result of any investment made pursuant to this
Agreement or as a result of any liquidation of any investment prior to its maturity.
3. Return of Deposit to Developer. At any time following the Deposit with the
City,Developer may deliver to City a factually correct written notice (the "Draw Certificate")
executed by an officer of Developer(i) stating that commencement of construction of the hotel
on the Hotel Parcel, as the term"commencement of construction"is defined in the Phasing
Condition,has occurred and(ii)requesting payment of the Deposit to the Developer. If such
written notice is received and if the commencement of construction,as defined in the Phasing
Condition shall have occurred on or before the 240th day after the Deposit shall have been
tendered to the City,then the City shall return the Deposit to the Developer within ten (10)after
such notice is received.
4. Liquidated Damages. IF COMMENCEMENT OF CONSTRUCTION,AS
DEFINED IN THE PHASING CONDITION, OF THE HOTEL ON THE HOTEL
PARCEL DOES NOT OCCUR ON OR BEFORE THE 240TH DAY AFTER THE
DEPOSIT IS TENDERED TO THE CITY,THEN IT IS CERTAIN THAT THE CITY
WILL SUFFER LOSSES IN REVENUE,THE EXTENT OF WHICH IS DIFFICULT OR
3 103472.2
IMPOSSIBLE TO ASCERTAIN. ACCORDINGLY,IN SUCH CASE,THE CITY SHALL
BE ENTITLED TO RETAIN THE DEPOSIT AND ANY INTEREST THEREON AS
LIQUIDATED DAMAGES. BY PLACING THEIR INITIALS BELOW, DEVELOPER
AND CITY ACKNOWLEDGE THEIR AGREEMENT TO THIS LIQUIDATED
DAMAGES PROVISIO .
Developer Initials Initials
5. City's Duties and Liabilities.
(a) The City undertakes to perform only such duties as are expressly set forth
herein.
(b) The City shall not be liable for any action taken or omitted by it in good
faith except for any liability arising from its own gross negligence or willful misconduct. In the
administration of this Agreement,the City may execute any of its powers and perform its duties
hereunder directly or through agents or attorneys and may consult with counsel,accountants and
other skilled persons to be selected and retained by it. The City shall not be liable for anything
done, suffered or omitted in good faith by it in accordance with the advice or opinion of any such
counsel,accountants or other skilled persons appointed by it with due care.
(c) The City waives all rights to setoff against the moneys held by City
pursuant to the provisions hereof.
6. Miscellaneous.
(a) All notices and communications hereunder shall be in writing and shall be
deemed to be duly given upon personal delivery, commercial delivery service,by registered or
certified mail (return receipt requested) or sent via facsimile(with acknowledgment of complete
transmission) at the following addresses (or at such other address for a party as shall be specified
by like notice):
4 103472.2
DEVELOPER: SNK Arioso LP
Four Embarcadero Center
Suite 3700
San Francisco,California 94111
Attention: Hal Watson III
Telephone: (415)433-0701
Facsimile: (415)433-0706
CITY: City of Cupertino
10300 Tone Avenue
Cupertino,California 95014
Attention:
Telephone:
Facsimile:
(b) The provisions of this Agreement may be waived,altered,amended or
supplemented, in whole or in part,only by a writing signed by all of the parties hereto.
(c) Neither this Agreement nor any right or interest hereunder may be assigned in
whole or in part by the City. Developer may assign it rights under this Agreement to any person
or entity and such assignment shall be effective upon written notice to the City accompanied by a
copy of the document effectuating such assignment.
(d) This Agreement may be executed in one or more counterparts, each of which
shall be deemed an original,but all of which together shall constitute one and the same
instrument.
(e) This Agreement shall be governed by and construed in accordance with the laws
of the State of California,regardless of the laws that might otherwise govern under applicable
principles of conflict of laws thereof. Each party hereto irrevocably waives any objection on the
grounds of venue,forum non-convenience or any similar grounds and irrevocably consents to
5 103472.2
service of process by mail or in any other manner permitted by applicable law and consents to
the jurisdiction of said courts.
IN WITNESS WHEREOF,the parties hereto have executed this Agreement on the date
and year first above written.
DEVELOPER:
SNK ARIOSO LP,
a Delaware limited partnership
By: SNK Wo e Inc., a California corporation
Its: Gener d '.
By:
� "�
Title:
CITY:
CITY OF CUPERTINO,
a municipal corporation of the State of California
By: / Or
Its: M. •or
</3�By: /
Its: City Clerk
Approved as to form:
City Attorney
6 103472.2
U3/cw 177/ j.7:1( gatl f(,3 bb QPERTINO CITY ADMIN PAGE 01
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'' RESOLUTION NO. 9935 ._
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CUPERTINO ---
APPROVING MODIFICATIONS TO A TENTATIVE MAP
RELATED TO DEVELOPMENT PHASING
(APPLICATION NO.8-TM-96(MOD.) s
WHEREAS, the City of Cupertino has approved an application for a Tentative Map
Application 8-TM-96,as described in this resolution;and
WHEREAS, the conditions of approval for said application have a provision for
development phasing. J
NOW, THEREFORE, BE IT RESOLVED, that the City Council of the City of Cupertino
hereby approves modification of Condition No. 6 of Application No. 8-TM-96 as follows:
6. DiaanigtalgarnitallIQ
In order to ensure that the construction of the hotel (on parcel 2 of the zoning plot
map) is initiated in a timely fashion, the commencement of its construction shall occur prior to, or •
simultaneously with, the issuance of building permits for any multi-family residential units on
Parcel 1. As used herein, "commencement of construction"means: 1) elI plans for the construction (
of the hotel (foundations and structure) must be submitted to, and approved by the City gal 2) all `
foundations for the hotel (including the installation of footings, and first floor slab) must be 4
completed and inspected by the City. I:
,i.
• If the commencement of construction of the hotel has not occurred when the applicant
requests issuance of building permits for any multi-family residential units on Parcel 1, the '!
applicant may elect to proceed with construction of said units, prior to the commencement of
construction of the hotel by immediately tendering the sum of$1,000,000 to the City to be retained ►
by the City as security for the timely commencement of construction of the hotel. If applicant '
tenders such amount to the City, then commencement of construction of the hotel shall not be
required prior to, or simultaneously with, the issuance of building permits for any multi-family 3
residential units on parcel 1 and the condition set forth herein shall be deemed satisfied to the extent
that it affects the development of Parcel 1.
Said sum shall be deposited with the City Treasurer and shall earn interest at the same rate as IE
other City short term investments. If the commencement of construction of the hotel occurs within 't
240 days of the tender of said sum to the City, then, in that event, said sum together with interest,
shall be returned to the applicant. If commencement of construction does not occur within said 240
days, than, in that event, said sum together with interest, shall be retained by the City as liquidated
damages, The specific procedures for tender,retention,and return of said sum will be memorialized ti'
in an agreement between the applicant and the City to be fully executed prior to close of escrow on t,
the subject property.
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en. 05 • 97 (FRI) 19:SO COrnnrNICATION 741-t14 PARR. I
6/4 '3OYd 90L0 EEtr Sib ]INS 44tdt (IU. ) L6 . 50 •des
u211177i177r 1J:1f 40011,4.70b C PERTINo CITY ADMIN PAGE 82
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Resolution No. 9935
Page 2
This condition becomes effective only upon the City's approval, prior to the second reading •
of Ordinance 1764 amending 6-Z-96, of a fully executed Hilton standard form license agreement
which specifically provides that all conditions(with the exception of the completion of the purchase )
of the subject property) described in Hilton's letter to Peter Pau dated May 12, 1997 have been
fulfilled. Said agreement shall be reviewed by the City Attorney and approved by the City Council '•
before this condition becomes effective.
In the event that this condition does not become effective, the original conditions 4, '17, and 6
contained in 6-Z-96, 15-U-96,and II.TM-96,respectively, shall remain in Rill force and effect.
PASSED AND ADOPTED at the regular meeting of the City Council of the City of
Cupertino this 2nd day of September, 1997, by the following vote:
Vote Members of the City Council
AYES: Burnett, Chang,Bautista
NOES: Dean, Sorensen
ABSENT: None
ABSTAIN: . None 1
ATTEST: APPROVED:
.1
City Clerk Mayor,City of Cupertino
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eer. 05 ' 97 (FRI) 15:99 CO]On1NIcATION x.:14 PAGE. 2 l,,
6/5 'Soya SOLO SO, SIV NNE SIP:4; (I88) L6 . So 'gas
--• --• ---. ..•, .,.o, , ,»=0 Ula tK VINO CITY ADMIN PAGE e3
is
RESOLUTION NO. 9936
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CUPERTINO [,
APPROVING MODIFICATIONS TO A USE PERMIT
RELATED TO DEVELOPMENT PHASING
(APPLICATION NO. 15-U-96(MOD.)
•
WHEREAS, the City of Cupertino has approved an application for Use Permit
Application No. 15-U-96, as described in this resolution; and
WRERAS, the conditions of approval for said application have a provision for ''
development phasing.
NOW, THEREFORE, BB IT RESOLVED,that the City Council of the City of Cupertino "
hereby approves modification of Condition No. 17 of Application No. 15-1.1-96 ea follows:
17. DEVELOPMENT PHASINQ
In order to ensure that the construction of the hotel (on parcel 2 of the zoning plot map)is •
initiated in a timely fashion, the commencement of its construction shall occur prior to, or t
simultaneously with, the issuance of building permits for any multi-family residential units on
Parcel 1. As used herein, "commencement of construction" means: 1) all plans for the •
construction of the hotel (foundations end structure) must be submitted to, and approved by the
City and 2) all foundations for the hotel (including the installation of footings, and first floor
slab)must be completed and inspected by the City.
'.P
If the commencement of construction of the hotel has not occurred when the applicant
requests issuance of building permits for any multi-fhmily residential units on Parcel 1, the -
applicant may elect to proceed with construction of said units, prior to the commencement of
construction of the hotel by immediately tendering the scam of $1,000,000 to the City to be
retained by the City as security for thetimely commencement of construction of the hotel. If
applicant tenders such.amount to the City,then commencement of construction of the hotel shall
not be required prior to, or simultaneously with, the issuance of building permits for any multi-
family residential units on parcel 1 and the condition set forth herein shall be deemed satisfied to '
the extent that it affects the development of Parcel I. I�
Said sum shall be•deposited with the City Treasurer and shall earn interest at the same f
rate as other City short term investments. If the commencement of construedon of the hotel
occurs within 240 days of the tender of said sum to the City, then, in that event, said sum '
together with interest, shall be returned to the applicant. If commencement of construction does '
not occur within said 240 days, then, in that event, said sum together with interest, shall be
retained by the City as liquidated damages. Thu specific procedures for tender. retention, and
return of said sum will be memorialized in an agreement between the applicant and the City to be t
tally executed prior to close of escrow on the subject property.
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' 4
ORDINANCE NO. 1764
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF CUPERTINO 1
AMENDING ORDINANCE NO. 1750 REGARDING A CONDITION OF APPROVAL •
FOR APPLICATION NO. 6-Z-96, A PARCEL LOCATED AT 10741 NORTH
WOLFE ROAD AND 19590 PRUNERIDGE AVENUE(APPLICATION NO. 64-96(MOD.) 1.
WHEREAS, an application was filed (Application No. 6-Z-96 (Mod.) for modifications
to a condition of approval regarding development phasing;and
NOW,THEREFORE,BE IT ORDAINED that the City Colman of the City of Cupertino :•
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hereby approves modification of Condition No.4of Application No. 6-Z-96 as follows:
4. DEVELOPMENT PHASING
In order to ensure that the construction of the hotel(on parcel 2 of the zoning plot map) is •i
initiated in a timely fashion, the Commencement of its construction shall occur prior to, or •
simultaneously with, the issuance of building permits for any multi-family residential units on ,
Parcel 1. As used herein, "commencement of construction" means: 1) all plans for the tconstruction of the hotel (foundations and structure) must be submitted to, and approved by the ,
City apg 2) all foundations for the hotel (including the installation of footings, end first floor '
slab)must be completed and inspected by the City.
If the commencement of construction of the hotel has not occurred when the applicant 1
requests 133u023.09 of building permits for any multi-family residential units on Pel
applicant may elect to proceedwith construction of said units, prior to the commencement of
construction of the hotel by immediately tendering the sum of 51,000,000 to the City to be I.
retained by the City as security for the timely commencement of construction of the hotel. If
applicant tenders such amount to the City, then commencement of construction of the hotel shall
not be required prior to, or simultaneously with, the issuance of building permits for any multi-
family residential units on parcel I and the condition set forth herein shall be deemed satisfied to i.
the extent that it effects the development of Parcel 1. ' •
Said sum shall be deposited with the City Treasurer and shall cam interest at the same I
rate as other City short term investments. If the commencement of construction of the hotel
occurs within 240 days of the tender of said sum to the City, then, in that event, said sum +
together with interest, shall be returned to the applicant if commencement of construction does '
not occur within. said 240 days, then, in that event, said sum together with interest, shall be •
retained by the City as liquidated damages. The specific procedures for tender, retention, and 3
return of said sum will be rnemorialized in,an agreement between the applicant and the City to be ;� '
fully executed prior to close of escrow on the subject property. . . •
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IMP. 05 '•97 (PRI) 19:40 CC1aaINICATION N.:14 PAaa. '5 !
E/Z 'aovd 90L0 EES 5I4 xNe 04,80 MIIH.L) L6 . 81 'axe
•
This condition becomes effective only upon the City's approval, prior to the second
reading of Ordinance 1764 amending 6-Z-96, of a fully sxscntad MltMna st9vglmid fnnn license I
agreement which specifically provides that all conditions (with the exception of the completion
• of the purchase of the subject property) described in Hilton's letter to Peter Pau dated May 12, I.
1997,have been fulfilled. Said agreement shall be reviewed by the City Attorney and approved •
by the City Council before this condition becomes effective.
In the event that this condition does not become effective, the original conditions 4, 17,
and 6 contained in 6-Z-96, 15-11-96, and 8-TM-96, respectively, shall remain in fish force and
effect.
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INTRODUCED at a regular meeting of th"city['nonan of the City of Cupertino this 2nd -
i
day of September, 1997, and ENACTED at a regular meeting of the City Council of the City of l'
Cupertino this day of . 1997,by the following vote: '
Yale Meininigliltreltrdallsa •
AYES: Burnett,Chang,Bautista
NOES: Dean,Sorensen i
ABSENT: None `
ABSTAIN: None . !f
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ATTEST: APPROVED: F
•/e/ Kimberly Smith /of John aentieta . 1.1
City Clerk Mayor,City of Cupertinoii
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GNP. 05 ' 97 (FRI) 19:4t COIOLVNICAT!ON No:14 PAO* d
E/E '3OVd 90L0 EE4 5I4 )INS IV:B0 UIHL) L6 . BS 'dae