CC Ordinance No. 18-2179 Approving the DAORDINANCE NO. 18-2179
ORDINANCE OF THE CITY COUNCIL OF THE CITY OF CUPERTINO
APPROVING A DEVELOPMENT AGREEMENT BY AND BETWEEN
THE CITY OF CUPERTINO AND VALLCO PROPERTY OWNER LLC
FOR THE DEVELOPMENT OF VALLCO TOWN CENTER
SECTION 1: PROTECT DESCRIPTION
Application No: DA -2015-02
Applicant: Vallco Property Owner LLC
Location: 10101 to 10333 N Wolfe Rd
APN#s: 316-20-080, 316-20-081, 316-20-103, 316-20-107, 316-20-101, 316-20-105,
316-20-106, 316-20-104, 316-20-094, 316-20-099, 316-20-100, 316-20-095
SECTION II: RECITALS
WHEREAS, Vallco Property Owner, LLC ("Vallco") has a legal and equitable
interest in certain real property consisting of approximately 50.82 acres located within the
City and generally bordered by Perimeter Road on the north, Perimeter Road on the east,
Vallco Parkway and Stevens Creek Boulevard on the south, and Perimeter Road on the
west, as more particularly described in Exhibit DA -1, the Development Agreement
("Property"); and
WHEREAS, Government Code Sections 65864 through 68569.5 provide the
statutory authority for development agreements between municipalities and parties with
a fee or equitable interest in real property; and
WHEREAS, Chapter 19.144 of Cupertino Municipal Code ("CMC,") establishes
additional procedures for review and approval of proposed development agreements by
the City of Cupertino ("City"); and
WHEREAS, in October 2017, Vallco requested that the City initiate the process for
preparation and adoption of a specific plan for the Vallco Special Area; and
WHEREAS, the Vallco Town Center Specific Plan has been developed pursuant
to City Council direction to initiate a project to prepare a specific plan for the Vallco
Special Area, including any required changes to the adopted goals and objectives for the
Special Area, in order to implement the Housing Element of the Cupertino General Plan
and to plan for anticipated future development activity; and
WHEREAS, the Vallco Town Center Specific Plan sets forth two tiers of
development capacity as follows: (1) Tier 1 sets forth a basic program of development of
the Specific Plan area (750,000 square feet of office, 1,779 residential units, and a minimum
of 600,000 square feet of retail) without provision of above -standard community benefits;
Ordinance No. 18-2179 Vallco Town Center Specific Plan - DA
and (2) Tier 2 allows for a greater amount of office and residential development, as
described in the Vallco Town Center Specific Plan, provided the Developer enters into a
Development Agreement with the City which provides for certain above -standard
community benefits (collectively, the "Project"); and
WHEREAS, Vallco has proposed to provide certain community benefits and to
develop the Tier 2 program in accordance with the Specific Plan; and
WHEREAS, the City and Vallco have negotiated the terms of a Development
Agreement to vest the Tier 2 program in consideration of the community benefits and
provide limited vesting of the Tier 1 program; and
WHEREAS, the terms of the Development Agreement include the following
community benefits to be provided by Vallco, which are described in more detail in the
proposed Development Agreement:
• Performing Arts Center — Vallco would either, at City's option: (i) build and
lease to City a 60,000 square foot "warm shell" space suitable for a performing
arts center (PAC), or (ii) pay the City a $22,800,000 in lieu payment.
• City Hall — Vallco would either (i) demolish the existing City Hall building and
then build and deliver to City a 40,000 square foot "warm shell" new City Hall
including underground parking, substantially consistent with the City's 2015
civic center master plan, or (ii) pay the City a $30,000,000 in lieu payment.
• School District Benefits —
o FUHSD - Vallco would commit to either (i) build and lease to FUHSD a
25,000 square foot "warm shell" space, or (ii) pay FUHSD a $9,500,000
in lieu payment, with terms to be set forth in a separate agreement to be
entered into between Developer and FUHSD.
o CUSD — Vallco would make a payment to CUSD in the amount of
$14,250,000 pursuant to a separate agreement, which would decrease to
$9,500,000 if there is a challenge to the Project.
• Affordable Housing — Vallco would agree that 20% of the residential units
would be provided as affordable housing at the following percentages: 15% at
extremely low, very low and low income levels and 5% at moderate income
level.
• Transportation Benefits -
o Vallco would implement a TDM Program.
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Ordinance No. 18-2179 Vallco Town Center Specific Plan - DA
o Vallco would pay $11 million to City to fund work in connection with
the Wolfe Road/I-280 and the Junipero Serra Bike/Pedestrian Trail. This
would decrease to $5.5 million if there is a challenge to the Project.
o Vallco would fund up to $1 Million for a 1 -year pilot shuttle program
and, if successful $750,000 thereafter for 9 years, which would decrease
if there is a challenge to the Project.
o Vallco would provide a mobility/bike hub within the project.
• Co-working/Incubator Space - Vallco would make good faith efforts to provide
40,000 square feet of co working or incubator space.
WHEREAS, the Development Agreement will be consistent with the City's
General Plan land use map, proposed uses and surrounding uses as amended and the
applicable zoning designations and the Vallco Town Center Specific Plan as adopted; and
WHEREAS, approval of the Development Agreement will provide Vallco with
assurances that its development of the Property in connection with the Project can
proceed without disruption caused by a change in City planning and development
policies and requirements, which assurance will thereby reduce the actual or perceived
risk of planning, financing and proceeding with construction and use of the development
and promote the achievement of the private and public objectives of the development;
and
WHEREAS, the Development Agreement is envisioned by and consistent with the
Vallco Town Center Specific Plan, all as fully described and analyzed in the May 2018
Vallco Special Area Specific Plan Environmental Impact Report ("Draft EIR") (State
Clearinghouse No. 2018022021), as amended by the July 2018 Vallco Special Area Specific
Plan Environmental Impact Report Amendment ("EIR Amendment") and by text
revisions in the August 2018 Vallco Special Area Specific Plan Final EIR document which
contains Response to Comments to the Draft EIR and the EIR Amendment, and the
August 30, 2018, September 11, 2018, and September 13, 2018 Supplemental Text
Revisions to the Vallco Special Area Specific Plan Final Environmental Impact Report;
(together, the "Final EIR"); and
WHEREAS, following necessary public notices given as required by the
procedural ordinances of the City of Cupertino and the Government Code, the Planning
Commission held a public hearing on September 4, 2018 to consider the Development
Agreement; and
WHEREAS, the Final EIR was presented to the Environmental Review Committee
("ERC") for review and recommendation on August 31, 2018, and after considering the
Final EIR, and Staff's presentation, the ERC recommended on a 5-0 vote that the City
Council certify the EIR; and
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Ordinance No. 18-2179 Vallco Town Center Specific Plan - DA
WHEREAS, based on substantial evidence in the administrative record, on
September 4, 2018 the Planning Commission recommended on a 5-0 vote that the City
Council certify that the Final EIR has been completed in compliance with the California
Environmental Quality Act, Public Resources Code Section 21000 et seq., and reflects the
independent judgment and analysis of the City, adopt the Findings and Statement of
Overriding Considerations, and adopt and incorporate into the project all of the
mitigation measures that are identified in the Final EIR, and implement all of the
mitigation measures that are within the responsibility and jurisdiction of the City in
substantially similar form to the Resolution presented (Resolution No. 6860); and
WHEREAS, on September 4, 2018, the Planning Commission recommended on a
4-1 vote (Liu: no) that the City Council adopt amendments to the General Plan to allow
implementation of the Vallco Town Center Specific Plan (Resolution No. 6861), adopt the
Vallco Town Center Specific Plan (Resolution No. 6863), and an ordinance approving the
Development Agreement (Resolution No. 6865) with additional recommendations to
amend Strategy LU -19.1.2, correct Table LU -1, and consider a middle tier Development
Allocation for the Vallco Town Center Special Area as more particularly described in
Resolution nos. 6861, 6863 and 6865. The Planning Commission also recommended on a
5-0 vote that the City Council adopt Municipal Text Amendments (Resolution No. 6864)
and Zoning Map Amendments (Resolution No. 6862) to allow implementation of the
Vallco Town Center Specific Plan and therefore, allow adoption of this Development
Agreement; and
WHEREAS, on September 18, 2018 and September 19, 2018, upon due notice, the
City Council held a public hearing to consider the Development Agreement; and
WHEREAS, the City Council of the City of Cupertino is the decision-making body
for this Ordinance; and
WHEREAS, after consideration of evidence contained in the entire administrative
record, on September 19, 2018 (continued from September 18, 2018), the City Council
adopted Resolution No. 18-084 certifying the Final EIR, adopting the Findings and a
Statement of Overriding Considerations, adopting the Mitigation Measures, and
adopting a Mitigation Monitoring and Reporting Program; and
WHEREAS, prior to taking action on this Ordinance, the City Council has
exercised its independent judgment in carefully considering the information in the Final
EIR and finds that the scope of this Ordinance falls within the certified Final EIR, in that
the aspects of the Development Agreement proposed in this Ordinance that have the
potential for resulting in either a direct physical change in the environment or a
reasonably foreseeable indirect physical change in the environment have been examined
in the Final EIR; therefore, no recirculation of the Final EIR is required; and
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Ordinance No. 18-2179 Vallco Town Center Specific Plan - DA
WHEREAS, after a duly noticed public hearing, on September 19, 2018 (continued
from September 18, 2018), prior to consideration of the Development Agreement, the
Council adopted Resolution No. 18-085, approving a General Plan Amendment to
Development Allocations, the General Plan Land Use Map and development standards
related to the Vallco Special Area, adopted Resolution No. 18-086, approving the Vallco
Town Center Specific Plan, Ordinance No. 18-2177, amending the Municipal Code text to
allow implementation of the Vallco Town Center Specific Plan and Ordinance No. 18-
2178, rezoning the parcels within the Vallco Special Area Specific Plan.
NOW, THEREFORE, BE IT ORDAINED AS FOLLOWS:
Section 1. The recitals set forth above are true and correct, and are hereby
incorporated herein by this reference as if fully set forth in their entirety.
Section 2. The City Council, having considered the staff report to the City
Council for the meeting of September 19, 2018 (continued from September 18, 2018),
evidence received at the public hearing duly noticed and held for the proposed
Development Agreement, and all other facts, exhibits, testimony, information and other
evidence submitted in this matter or in the record of this proceeding, finds as follows:
A. The proposed Development Agreement is consistent with the
objectives, policies, general land uses and programs specified in the General Plan, as
amended.
B. The proposed Development Agreement is compatible with the uses
authorized in, and the regulations prescribed for, the land use district in which the Project
is located.
C. The proposed Development Agreement is in conformity with and
will promote public convenience, general welfare, and good land use practice.
D. The proposed Development Agreement will not be detrimental to
the health, safety, or general welfare.
E. The proposed Development Agreement will not adversely affect the
orderly development of property or the preservation of property values.
F. The proposed Development Agreement will promote and encourage
the development of the Project by providing a greater degree of requisite certainty.
Section 3. The City Council hereby approves the Development Agreement in
the form attached subject to such minor technical conforming changes as may be
approved by the City Attorney. This approval is based on the City Council's
consideration of and reliance on the Final EIR and in accordance with the plans, details
and descriptions contained therein, and in the Resolution certifying the Final EIR.
Page 5 of 7
Ordinance No. 18-2179 Vallco Town Center Specific Plan - DA
Section 4. The City Council hereby authorizes the City Manager to execute the
Development Agreement on behalf of the City.
Section 5. The City Council directs the Director of Community Development
to file a Notice of Determination with the Santa Clara County Recorder in accordance
with CEQA guidelines.
Section 6. This Ordinance shall be effective thirty (30) days following its
adoption.
INTRODUCED at a special meeting of the Cupertino City Council the 19th day of
September 2018 (continued from September 18, 2018) and ENACTED at a regular meeting
of the Cupertino City Council on this 2nd day of October 2018 by the following vote:
AYES: Sinks, Chang, Vaidhyanathan
NOES: Paul, Scharf
ABSENT: None
ABSTAIN: None
ATTEST:
6, Ad -2 - / k
Grace Schmidt, City Clerk
APPROVED:
Darcy Paul, Mayor, City of Cupertino
Page 6 of 7
STATE OF CALIFORNIA )
COUNTY OF SANTA CLARA )
CITY OF CUPERTINO )
1, GRACE SCHMIDT, City Clerk and ex -officio Clerk of the City
Council of the City of Cupertino, California, do hereby certify the attached
to be a true and correct copy of Ordinance No. 18-2179, which was
enacted on October 2, 2018, and that it has been published or posted
pursuant to law (G.C. 40806).
IN WITNESS WHEREOF, I have hereunto set my hand and seal
this 2nd day of October, 2018.
GRACE SCHMIDT, City Clerk and Ex -officio Clerk
of the City Council of the City of Cupertino, California
RECORDING REQUESTED BY
AND WHEN RECORDED RETURN TO:
City of Cupertino
10300 Torre Avenue
Cupertino, CA 95014-3202
Attention: City Manager
Record for the Benefit of
The City of Cupertino
Pursuant to Government Code
Section 27383
Space Above Reserved for Recorder's Use Only
DEVELOPMENT AGREEMENT
BY AND BETWEEN
CITY OF CUPERTINO, A
A CALIFORNIA MUNICIPAL CORPORATION
VALLCO PROPERTY OWNER LLC,
A DELAWARE LIMITED LL&BILITY COMPANY
EFFECTIVE DATE: 2018
TABLE OF CONTENTS
Page
ARTICLE 1 DEFINITIONS............................................................................................................6
1.1
Definitions................................................................................................................6
ARTICLE 2 EFFECTIVE DATE AND TERM............................................................................12
2.1
Effective Date........................................................................................................12
2.2
Initial Term of Agreement.....................................................................................12
2.3
City Representations and Warranties.....................................................................14
2.4
Developer Representations and Warranties...........................................................14
ARTICLE 3 DEVELOPMENT OF THE PROPERTY.................................................................15
3.1
Vested Rights.........................................................................................................15
3.2
Limited Vested Rights for Tier 1 Project...............................................................15
3.3
Life of Approvals...................................................................................................15
3.4
Permitted Uses.......................................................................................................15
3.5
Water Supplies.......................................................................................................15
3.6
Applicable City Regulations..................................................................................16
3.7
Timing of Development.........................................................................................16
3.8
Compliance with Laws..........................................................................................17
3.9
No Conflicting Enactments....................................................................................17
3.10
Changes in the Law................................................................................................18
3.11
Initiatives and Referenda.......................................................................................18
3.12
Regulation by Other Public Agencies....................................................................18
3.13
Public Infrastructure...............................................................................................19
3.14
Sanitary Sewer Capacity........................................................................................19
ARTICLE4 FEES.........................................................................................................................20
-1-
TABLE OF CONTENTS
(continued)
Page
4.1
Impact Fees............................................................................................................20
4.2
Processing Fees......................................................................................................22
4.3
Other Agency Fees.................................................................................................22
4.4
Taxes and Assessments..........................................................................................22
4.5
Connection Fees.....................................................................................................22
4.6
Right to Challenge Fees.........................................................................................22
ARTICLE 5
PUBLIC BENEFITS.................................................................................................22
5.1
Performing Arts Center..........................................................................................22
5.2
City Hall.................................................................................................................24
5.3
Benefits to School Districts...................................................................................28
5.4
Transportation and Transportation Demand Management (TDM) Program .........
29
5.5
Housing Plan..........................................................................................................30
ARTICLE 6
ANNUAL REVIEW.................................................................................................30
6.1
Annual Review.......................................................................................................30
ARTICLE 7
COOPERATION AND IMPLEMENTATION........................................................32
7.1
Subsequent Approvals...........................................................................................32
7.2
Scope of Review of Subsequent Approvals...........................................................32
7.3
Processing Applications for Subsequent Approvals..............................................33
7.4
Other Agency Subsequent Approvals; Authority of City......................................34
7.5
Consents.................................................................................................................34
7.6
Subdivision............................................................................................................35
7.7
Existing, Continuing Uses and Interim Uses.........................................................36
ARTICLE 8
AMENDMENT OF AGREEMENT AND PROJECT APPROVALS .....................37
TABLE OF CONTENTS
(continued)
Page
8.1
Amendment by Written Consent...........................................................................37
8.2
Project Approval Amendments..............................................................................37
8.3
Amendment of this Agreement..............................................................................38
8.4
Amendments to Development Agreement Statute.................................................38
ARTICLE 9 INSURANCE,
INDEMNITY AND COOPERATION IN THE EVENT OF
LEGAL CHALLENGE.........................................................................................38
9.1
Insurance Requirements.........................................................................................38
9.2
Indemnity and Hold Harmless...............................................................................39
9.3
Defense and Cooperation in the Event of a Litigation Challenge .........................39
ARTICLE 10
ASSIGNMENT, TRANSFER AND NOTICE.......................................................40
10.1
General...................................................................................................................40
10.2
Notice of Assignment............................................................................................41
10.3
Assignment Processing..........................................................................................41
10.4
Expedited Financial Capability Review.................................................................42
10.5
Affiliated Party.......................................................................................................42
10.6
Partial Assignment.................................................................................................42
10.7
Release of Transferring Developer........................................................................43
10.8
Assignment to Financial Institutions or Mortgagee...............................................43
10.9
Successive Assignment..........................................................................................43
10.10
Rights of Developer...............................................................................................43
ARTICLE 11
MORTGAGEE PROTECTION..............................................................................44
11.1
Mortgagee Protection.............................................................................................44
11.2
Mortgagee Not Obligated......................................................................................44
11.3
Notice of Default to Mortgagee.............................................................................44
TABLE OF CONTENTS
(continued)
Page
11.4
No Supersedure......................................................................................................44
11.5
Mortgagee Requested Amendments......................................................................44
ARTICLE 12
DEFAULT; REMEDIES; TERMINATION..........................................................45
12.1
Breach and Default................................................................................................45
12.2
No Cross-Default...................................................................................................45
12.3
Termination............................................................................................................45
12.4
Specific Performance for Violation of a Condition...............................................45
12.5
Legal Actions.........................................................................................................46
12.6
Rights and Remedies Are Cumulative...................................................................46
12.7
No Damages...........................................................................................................46
12.8
Resolution of Disputes...........................................................................................47
12.9
Surviving Provisions..............................................................................................47
ARTICLE 13
GENERAL PROVISIONS.....................................................................................47
13.1
Condemnation........................................................................................................47
13.2
Covenants Binding on Successors and Assigns and Run with Land .....................48
13.3
Notice.....................................................................................................................48
13.4
Permitted Delays....................................................................................................49
13.5
Counterparts...........................................................................................................49
13.6
Waivers..................................................................................................................49
13.7
Construction of Agreement....................................................................................49
13.8
Headings................................................................................................................50
13.9
Severability............................................................................................................50
13.10
Time is of the Essence...........................................................................................50
TABLE OF CONTENTS
(continued)
Page
13.11
Extension of Time Limits......................................................................................50
13.12
Other Necessary Acts.............................................................................................50
13.13
Signatures...............................................................................................................50
13.14
Entire Agreement...................................................................................................50
13.15
Estoppel Certificate................................................................................................50
13.16
Recordation of Termination...................................................................................51
13.17
City Approvals and Actions...................................................................................51
13.18
Negation of Partnership.........................................................................................51
13.19
No Third Party Beneficiaries.................................................................................51
13.20
Governing State Law.............................................................................................52
13.21
Exhibits..................................................................................................................52
-v-
DEVELOPMENT AGREEMENT
This Development Agreement ("Agreement"), dated as of 12018
("Effective Date"), is entered into pursuant to the Development Agreement Law, by and
between the CITY OF CUPERTINO, a California municipal corporation ("City") and VALLCO
PROPERTY OWNER LLC, a Delaware limited liability company ("Developer"). Developer
and City are referred to individually in this Agreement as a "Party" and collectively as the
"Parties."
RECITALS
This Agreement is entered into on the basis of the following facts, understandings and
intentions of the Parties. The following recitals are a substantive part of this Agreement;
capitalized terms used herein and not otherwise defined are defined in Article 1 of this
Agreement.
A. In order to strengthen the public planning process, encourage private participation
in comprehensive planning, and reduce the economic costs and risks of development, the
Legislature of the State of California enacted section 65864 et seq. of the Government Code
("Development Agreement Statute") which authorizes a city and a developer having a legal or
equitable interest in real property to enter into a binding, long-term development agreement
establishing certain development rights in the property.
B. In accordance with the Development Agreement Statute, the City Council of the
City of Cupertino enacted Municipal Code sections 19.144.010 et seq. ("Development
Agreement Regulations"), which authorize the execution of development agreements and set
forth the required contents and form of those agreements. The provisions of the Development
Agreement Statute and the City's Development Agreement Regulations are collectively referred
to herein as the "Development Agreement Law."
C. Developer is the owner of that certain real property consisting of approximately
50.82 acres more particularly described and depicted in Exhibits A and B attached hereto and
incorporated herein ( "Property"). The Property is currently developed with the existing Vallco
Shopping Mall ("Vallco Mall") owned by Developer.
D. On December 4, 2014, following extensive public meetings, hearings and
community outreach, the City certified a General Plan Amendment, Housing Element Update,
and Associated Rezoning Environmental Impact Report ("General Plan EIR") and adopted the
Cupertino General Plan: Community Vision 2015-2040 ("General Plan"). The General Plan
designated the Property as a Priority Housing Element Site and included a General Plan vision
calling for the demolition of the Vallco Mall and the development of a new mixed-use Town
Center consisting of up to 2 million square feet of office, a minimum of 600,000 square feet of
retail, and a maximum residential density of 35 units per acre ("Vallco Town Center Vision").
The General Plan also envisioned the subsequent adoption of a Specific Plan for the Property.
E. On October 4, 2017, Developer requested the City to initiate a process to adopt a
specific plan for the 70 -acre area comprised of the Property and certain adjacent properties
( "Vallco Specific Plan"), to move forward with the City's Vallco Town Center Vision. The
City subsequently commenced the Vallco Specific Plan process in early 2018. The purpose of
the Vallco Specific Plan is to specify the allowed land uses, design standards and other
requirements and guidelines for development in the Specific Plan area.
F. On September 29, 2017 Governor Brown signed Senate Bill 35 into law, which is
aimed at addressing the State of California's housing shortage and affordability crisis ("SB 35").
SB 35 became effective as of January 1, 2018. On March 27, 2018 Developer submitted a
mixed-use development application under SB 35 ("SB 35 Application") consisting of 2,402
residential units (after a 35% bonus allowed under the State Density Bonus Law), including fifty
percent of the units affordable to low income households, together with 1,981,768 sq. ft. of office
and 485,912 sq. ft. of retail uses ("SB 35 Project"). Developer separately requested that the City
continue to process the City initiated Vallco Specific Plan concurrent with the SB 35
Application.
G. City continued to process the Vallco Specific Plan by holding numerous
charrettes, scoping sessions and community outreach meetings as part of the "Envision Vallco: A
Collaborative Design Process." The City additionally prepared a draft environmental impact
report for the Vallco Specific Plan ("Vallco DEIR") and held hearings pursuant to the California
Environmental Quality Act ("CEQA") (Public Resources Code section 21000 et seq. ). On May
25, 2018, the City circulated the Vallco DEIR for public review and comment for a period
through July 9, 2018.
H. On June 22, 2018, the City issued a letter to Developer confirming that the SB 35
Project is eligible for streamlined ministerial review under SB 35. The deadline for approval of
the SB 35 Project is not later than 180 days after submittal of the application on March 27, 2018.
I. Based on community input and City Council direction to provide a project
alternative with greater residential use and community amenities, the City sought information,
analysis and studies about another Specific Plan alternative that would increase the residential
housing on the Property ("Housing Rich Alternative"). To address these considerations the
City circulated the Vallco DEIR Amendment analyzing under CEQA the Housing Rich
Alternative ("EIR Amendment"). The EIR Amendment was circulated for an additional 45 day
period commencing July 6, 2018 and ending on August 20, 2018.
J. City published the Vallco Final Environmental Impact Report consisting of the
Vallco DEIR, EIR Amendment, the comments submitted on both the Vallco DEIR and the EIR
Amendment, and the City's Responses to Comments on the Vallco DEIR and EIR Amendment
on August 27, 2018 ("Vallco FEIR" ).
K. On August 24, 2018, the City released a draft of the Vallco Specific Plan for
public review. The Specific Plan sets forth two tiers of development capacity. Tier 1 sets forth a
basic program of development of the Specific Plan area (750,000 square feet of office, 35
residential units per acre, and a minimum of 600,000 square feet of retail) without provision of
above -standard community benefits. Tier 2 allows for a greater amount of office and residential
development, as described in the Vallco Specific Plan, provided the Developer enters into a
Development Agreement with the City which provides for certain above -standard community
benefits. This Development Agreement satisfies the requirements to qualify for Tier 2, and also
2
provides limited vesting for Tier 1. The Vallco Specific Plan provides the zoning criteria for the
Property and the balance of the Vallco Specific Plan area, which require certain amendments to
the General Plan.
L. On September _, 2018, in advance of the overall 180 -day streamlined approval
process deadline set forth in SB 35, the City issued a letter approving the SB 35 Project.
M. The Planning Commission on September 4, 2018, recommended the following
action by adoption of Resolutions Nos. 6860, 6861, 6863 and 6865 to the City Council:
certification of the Vallco FEIR, approval of a General Plan amendment, approval of the Vallco
Specific Plan, and approval of this Development Agreement.
N. Prior to or concurrently with approval of this Agreement, the City has taken or
will take the following actions (collectively, the "Specific Plan Approvals"):
1. Certification of the Vallco FEIR by Resolution No. 18-084 adopted by the
City Council on September 19, 2018;
2. Approval of General Plan amendments by Resolution No. 18-085, adopted
by the City Council on September 19, 2018;
3. Approval of the Vallco Specific Plan by Resolution No. 18-086, adopted
by the City Council on September 19, 2018; and
4. Approval of rezoning by Ordinance No. 18-2178 adopted by the City
Council on .2018.
O. In accordance with the Specific Plan Approvals, Developer has proposed to
provide community benefits and develop the Tier 2 program on the Property as follows (the
"Project"):
1. Up to 2,668 residential units, including 20% affordable units, 40 of which
shall be designated for Extremely Low Income Households that Developer has proposed to rent
with a preference for individuals with development disabilities, and 80 market -rate senior
housing units, as more particularly described in the Housing Plan;
2. Up to 1,750,000 square feet of office uses, at least 250,000 square feet of
which is limited to Office Amenity Space, as described in the Specific Plan Approvals;
3. At least 485,000 square feet of retail uses, as described in the Vallco
Specific Plan, including up to 85,000 sf of civic and education uses, as more particularly
described in Article 5 (Community Benefits);
4. A hotel, as such use is defined in the Specific Plan, with up to 191 rooms,
and ancillary uses and amenities as described in the Vallco Specific Plan;
5. Parking and loading as described in the Vallco Specific Plan;
6. Publicly and privately accessible parks, open space, plazas and patios, as
described in the Vallco Specific Plan, including at least 6 acres of publicly accessible At Grade
open space, the locations, sizes and amenities of which will be specified in the MSDP and shall
be consistent with the criteria set forth in the Vallco Specific Plan; and
7. Within the existing air space easement, or modified easement subject to
City. approval, and subject to the criteria in the Vallco Specific Plan, a pedestrian bridge over
Wolfe Road, which may be open space and include retail and restaurant uses, provided such uses
are consistent with public access and comply with the design requirements set forth in the
Specific Plan.
P. Under this Development Agreement, Developer will provide substantial public
benefits for the Tier 2 Project as more specifically described in Article 5, including:
1. BMR Units. Project will include 20% BMR Units;
2. New Cites. Re -construction of a core and warm -shell for a new City
Hall, to be located on the site of the existing City Hall, or payment of an in -lieu fee of Thirty
Million Dollars ($30,000,000);
3. Performing Arts Center. Construction of a core and warm -shell for a new
60,000 sq. ft. performing arts center, to be located on a site in the vicinity of the proposed Town
Square, or payment to City of an in -lieu fee of Twenty Two Million Eight Hundred Thousand
Dollars ($22,800,000);
4. FUHSD. Construction of a 25,000 sq. ft. core and warm -shell space, for
use as an adult school and high school innovation center, to be leased for 34 years to FUHSD at
no cost, or payment to FUHSD of an in -lieu fee of Nine Million Five Hundred Thousand Dollars
($9,500,000);
5. CUSD. Payment of Fourteen Million Two Hundred Fifty Thousand
Dollars ($14,250,000);
6. Co -Working Incubator -Space. Good faith efforts to provide Forty
Thousand (40,000) square feet of co -working or incubator space in the Project;
7. Funding for TDM. Implementation of a Project TDM Program with a
goal of 34% non -single occupancy vehicles for office uses;
8. Mobility/Bike Hub. A mobility hub of at least 1,000 sq. ft., which may
include a bicycle facilities and services hub with bike storage, sales, rentals and repair facilities;
a transit stop and /or an ancillary use cafe;
9. Pilot Community Shuttle. $1,000,000 initial funding and operating a
community shuttle from Vallco to local schools and other transportation hubs and, if successful,
an ongoing $750,000 per year contribution for up to 9 additional years (subject to reduction per
Section 9.3.4); and
El
10. Transportation Infrastructure Contributions, Bike/Pedestrian Trail.
Contribution to City of Eleven Million Dollars ($11,000,000) ((subject to reduction per Section
9.3.4)) for study, design and construction of two critical transportation infrastructure projects
(a) the I-280/Wolfe Road interchange; and (b) potential future bicycle and pedestrian trail along
I-280, immediately north of the Project, commonly known as the Junipera Serra Trail.
Q. Under this Development Agreement, Developer will provide substantial public
benefits for the Tier 1 Project. In furtherance of the General Plan Land Use Goals [LU -1, LU -2,
LU -3, LU -4, LU -5, LU -6, LU -7, LU -8, LU -9, and LU -19], and the Vallco Specific Plan Goals
[as defined in Chapter 1, Purpose and Intent], the Tier 1 development program would result in
the following community -wide social benefits:
• Housing: 1,779 residential units inclusive of 15% Below Market Rate units, per
Specific Plan,
• Open Space, per Specific Plan, including:
• Multi -use pathway on the western edge, per the Specific Plan
• Public park and plazas, six acres of which must be provided at At Grade.
• Construct and dedicate to the City three new segments of the public right of way
frontage road on its Property immediately adjacent to North Wolfe.
R. It is the intent of City and Developer to establish certain conditions and
requirements related to review and development of the Project, which are or will be the subject
of subsequent development applications and land use entitlements and this Agreement.
S. City specifically finds, as required by Municipal Code section 19.144.110, and as
reflected in Ordinance No. 18-2179 that approving this Agreement for the Project, and for
limited purposes a Tier 1 alternative, will promote orderly growth and quality development in
accordance with the goals and policies set forth in the General Plan; is compatible with the uses
authorized in, and the regulations prescribed for, the district in which the Property is located; will
promote the public convenience, general welfare, and good land use practice; will promote
development which is not detrimental to the health, safety and general welfare; will not
adversely affect the orderly development of property or the preservation of property value; and
will promote and encourage the development of the Project, by providing a greater degree of
requisite certainty.
T. City and Developer have reached mutual agreement and desire to voluntarily
enter into this Agreement to facilitate development of the Project, subject to the conditions and
requirements set forth herein.
U. City has given the required notice of its intention to adopt this Agreement and has
conducted public hearings thereon pursuant to Government Code section 65867 and Municipal
Code section 19.144.090. City has reviewed and evaluated this Agreement in accordance with
the Development Agreement Law and found that the provisions of this Agreement and its
purposes are consistent with the Development Agreement Law and the goals, policies, standards
and land use designations specified in the General Plan.
V. City has approved this Agreement by Ordinance No. , adopted by the City
Council on , 2018 ("Enacting Ordinance").
AGREEMENT
NOW, THEREFORE, in consideration of the mutual covenants and promises contained
herein and other valuable consideration, the Parties hereby agree as follows:
ARTICLE 1
DEFINITIONS
1.1 Definitions¶
"Administrative Agreement Amendment" is defined in Section 8.3.1.
"Administrative Project Amendment" is defined in Section 8.2.1.
"Adult School and Innovation Center" is defined in Section 5.3.1.
"Affiliated Party" is defined in Section 10.5.
"Affordable Housing Agreement" is defined in the Housing Plan.
"Agreement" or "Development Agreement" means this Development Agreement
between City and Developer, including all Exhibits hereto.
"Annual Shuttle Contribution" is defined in Section 5.4.3.
"Applicable City Regulations" is defined in Section 3.5.
"Applicable Law" means the Applicable City Regulations and all State and Federal laws
and regulations applicable to the Property and the Project as such State and Federal laws are
enacted, adopted and amended from time to time, as more particularly described in Section 3.9
(Changes in the Law).
"ASR" is defined in Section 7.1
"Assignee" is defined in Section 10.1.
"Assignment" is defined in Section 10.2.
"At Grade" is defined in Section 4.1.2.
"Baseline Cost" is defined in Section 5.2.7.
"BMR Units" is defined in the Housing Plan.
"Building Permit" shall mean a building permit issued by the City for the vertical
construction of any building (or buildings) within the Project, and shall not include any
demolition permit, grading permit, or building permit issued for a foundation or subterranean
parking garage.
"CC&Rs" is defined in Section 7.6.3.
"CEQA" means the California Environmental Quality Act, California Public Resources
Code section 21000, et seq., as amended from time to time.
"CEQA Guidelines" means the State CEQA Guidelines (California Code of Regulations,
Title 14, section 15000, et seq.), as amended from time to time.
"Certificate" is defined in Section 6.1.4.
"Changes in the Law" is defined in Section 3.9.
"City" means the City of Cupertino.
"City Council" means to the City Council of the City of Cupertino.
"City Hall Approval" is defined in Section 5.2.5.
"City Hall Cost Cap" is defined in Section 5.2.3.
"City Hall Deviations" is defined in Section 5.2.3.
"City Hall Master Plan" is defined in Section 5.2.2.
"City Hall Payment" is defined in Section 5.2.1
"City Manager" means the City's City Manager or his or her designee.
"City Parties" means and includes City and its elected and appointed officials, officers,
employees, contractors and representatives.
"Claims" means liabilities, obligations, orders, claims, damages, fines, penalties and
expenses, including attorneys' fees and costs.
"Connection Fees" means those fees charged by City on a citywide basis or by a utility
provider to utility users as a cost for connecting water, sanitary sewer, and other applicable
utilities, except for any such fee or portion thereof that constitutes an Impact Fee, as defined
below.
"Consent" is defined in Section 7.5.
"Construction Tax" is defined in Section 4.4.
"CPI -U" is defined in Section 4.1.
"CUSD" is defined in Section 5.3.2.
"Default" is defined in Section 12.1.
"Design Deviations" is defined in Section 5.2.9.
"Deviation Cost Allowance" is defined in Section 5.2.9.
"Developer" means Vallco Property Owner LLC, a Delaware limited liability company
and its permitted successor and assigns.
"Development Agreement" or "Agreement" mean this Development Agreement between
City and Developer, including all Exhibits hereto.
"Development Agreement Law" is defined in Recital B.
"Development Agreement Regulations" is defined in Recital B.
"Development Agreement Statute" is defined in Recital A.
"Effective Date" means the date that this Agreement becomes effective as detennined
under Section 2.1.
"EIR Amendment" is defined in Recital I.
"Enacting Ordinance" refers to the Ordinance identified in Recital T.
"Exactions" means exactions that may be imposed by the City as a condition of
developing the Project, including requirements for acquisition, dedication or reservation of land;
and obligations to construct on-site or off-site public and private infrastructure improvements
such as roadways, utilities or other improvements necessary to support the Project, whether such
exactions constitute subdivision improvements, mitigation measures in connection with
environmental review of the Project, or impositions made under Applicable City Regulations.
For purposes of this Agreement, Exactions do not include Impact Fees.
"Excluded Items" is defined in Exhibit G.
"Existing City Hall" is defined in Section 5.2.1.
"Extension Term" is defined in Section 2.2.1.
"Final" means the date on which (1) all applicable appeal periods for the filing of any
administrative challenging the issuance or effectiveness of a Project Approval shall have expired
and no such appeal shall have been filed; (2) in the event of any administrative appeal or
Litigation Challenge challenging the Project Approval, that the administrative appeal or
Litigation Challenge is settled or there is a final determination or judgment upholding the Project
Approval, and the administrative appeal or Litigation Challenge is no longer subject to appeal;
and (3) in the event of a referendum challenging a Vested Approval, either City Council denies
the petition for referendum or the City Council certifies the results of the election under the
Elections Code upholding the Vested Approval and rejecting any challenge under any
referendum petition and all referendum related litigation challenges have been rejected.
"FUHSD" is defined in Section 5.3.1.
"General Plan EIR" is defined in Recital D.
"General Plan" is defined in Recital D.
"Housing Rich Alternative" is defined in Recital I.
"Impact Fees" means the monetary amount charged by City in connection with a
development Project for the purpose of defraying all or a portion of the cost of mitigating the
impacts of the development Project or development of the public facilities related to the
development Project, including, any "fee" as that term is defined by Government Code section
66000(b). For purposes of this Agreement, a fee that meets both the definitions of an Impact Fee
and an Exaction will be considered to be an Impact Fee.
"Impact Fee Lock Period" is defined in Section 4.1.
"Increased Construction Cost" is defined in Section 5.2.7.
"Initial Term" is defined in Section 2.2.
"Liquid Assets" is defined in Section 10.2.
"Litigation Challenge" is defined in Section 9.3.1.
"Major Agreement Amendment" is defined in Section 8.3.2.
"Major Project Amendment" is defined in Section 8.2.2.
"Master Tentative Map" means that initial tentative subdivision map or vesting tentative
subdivision map covering the entirety of the Property.
"Material Condemnation" is defined in Section 13.1.1.
"Mobility Hub" is defined in Section 5.4.2.
"Mortgage" means any mortgage, deed of trust, security agreement, and other like
security instrument encumbering all or any portion of the Property or any of the Developer's
rights under this Agreement.
"Mortgagee" means the holder of any Mortgage, and any successor, assignee or
transferee of any such Mortgage holder.
"MSDP" means the Master Site Development Permit for the entirety of the Project and
Property to be processed by Developer as a Subsequent Approval as provided herein.
Z
"Municipal Code" means and refers to the City of Cupertino's Municipal Code, as
amended from time to time.
"New City Hall" is defined in Section 5.2.1.
"New City Laws" means and includes any ordinances, resolutions, orders, rules, official
policies, standards, specifications, guidelines or other regulations, which are promulgated or
adopted by the City (including but not limited to any City agency, body, department, officer or
employee) or its electorate (through their power of initiative or otherwise) after the Effective
Date.
"Notice of Breach" is defined in Section 12.1.
"Office Amenity Space" is defined in the Specific Plan, and includes, in addition to the
uses specified therein, child care centers and interior hallways that exceed 7.5 feet in width.
"Other Agency Fees" means fees and charges imposed by other governmental agencies
which in some cases are collected by City on behalf of such other agencies.
"Other Agency Subsequent Approvals" means approvals, entitlement and permits
required for Development of the Project to be obtained from entities other than the City.
"PAC" is defined in Section 5.1.
"PA CIn Lieu Payment" is defined in Section 5.1.
"Parties" shall mean City and Developer.
"Permitted Delay" is defined in Section 13.4.
"Planning Commission" means the City of Cupertino Planning Commission.
"Prevailing Wage Laws" is defined in Section 9.2.
"Processing Fees" is defined in Section 4.2.
"Project Approvals" means the Vested Approvals and all Subsequent Approvals.
"Project" is defined in Recital O.
"Project Milestones" is defined in Section 2.2.1.
"Project Neutral Work" is defined in Section 2.2.6.
"Project Specific Work" is defined as work that is specific to either the SB 35 Project, a
Tier 1 development project, or the Project under this Agreement, contemplated to be work
beyond the Project Neutral Work.
"Property" is defined in Recital C.
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"Severe Economic Recession" means a quarterly decline in the monetary value of all
finished goods and services produced in the United States, as measured by initial quarterly
estimates of United States Gross Domestic Project ("GDP") published by the United States
Department of Commerce Bureau of Economic Analysis (and not subsequent monthly revisions),
lasting three (3) or more consecutive calendar quarters. Any quarter of flat or positive GDP
growth shall end the period of such Severe Economic Recession.
"Specific Plan Approvals" is defined in Recital N.
"SB 35" is defined in Recital F.
"SB 35 Application" is defined in Recital F.
"SB 35 City Hall Payment" is defined in Section 2.2.4.
"SB 35 Project" is defined in Recital F.
"Subsequent Approvals" is defined in Section 7.1.
"Term" means the Initial Term plus any Extension Term, if such Extension Term is
granted under the terms of this Agreement.
"Tier I" means the development program for the Property described in Table 3.2 of the
Specific Plan.
"Tier 1 Term" is defined in Section 3.2.
"Tier I Vested Approvals" means the Specific Plan Approvals relating only to Tier 1.
"Tier 2" means the development program for the Property described in Table 3.3 of the
Specific Plan.
"TIF" is defined in Section 4.1.1.
"Transportation Contribution" is defined in Section 5.4.4.
"Transportation Infrastructure Projects" is defined in Section 5.4.4.
"Updated Cost" is defined in Section 5.2.7.
"Vallco DEIR" is defined in Recital G.
"Vallco FEIR" is defined in Recital J.
"Vallco Mall" is defined in Recital C.
"Vallco Specific Plan" is defined in Recital E.
"Vallco Town Center Vision " is defined in Recital D.
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"Vested Approvals" means and includes this Agreement and the Specific Plan Approvals,
except for those provisions in the Specific Plan regarding the Tier 1 program, which are excluded
from the definition of Vested Approvals.
"Warm Shell" is defined in Section 5.1.2.
ARTICLE 2
EFFECTIVE DATE AND TERM
2.1 Effective Date¶ The Effective Date of this Agreement shall be the later of (a) the
date that is thirty (30) days after the date the Enacting Ordinance is adopted, or (b) the date this
Agreement is fully executed by the Parties. The Effective Date is inserted at the beginning of
this Agreement. The Parties acknowledge that section 65868.5 of the Development Agreement
Statute requires that this Agreement be recorded with the County Recorder no later than ten (10)
days after the City enters into this Agreement, and that the burdens of this Agreement shall be
binding upon, and the benefits of this Agreement shall inure to, all permitted successors in
interest to the Parties to this Agreement. The City Clerk shall cause such recordation.
2.2 Initial Term of Agreement¶ The "Initial Term" of this Agreement shall
commence on the Effective Date and shall expire on the eleventh (11th) anniversary of the
Effective Date, unless extended or earlier terminated as provided herein.
2.2.1 Extension of Initial Term. The Initial Term of this Agreement shall be
extended from the date of expiration of the Initial Term until the date which is five (5) years
following the expiration of the Initial Term ("Extension Term"), provided that at the end of the
Initial Term: (a) Developer is not, at the time, in Default of any of its obligations hereunder
following notice and expiration of applicable cure periods; (b) the applicable Developer
warranties and representations in Section 2.4 below continue to be true and correct; and (c)
Developer has completed the Project Milestones. The term "Project Milestones" means:
(i) delivery of Warm Shell New City Hall, or payment of City Hall Payment, as described in
Section 5.2 of this Agreement; and (ii) issuance of temporary certificates of occupancy for the
core and shell of all buildings surrounding the Town Square, as generally described in the Vallco
Specific Plan and to be more particularly specified in the MSDP, other than buildings and
associated utilities and infrastructure the development or construction of which would interfere
with existing contractual lease rights of tenants in possession as of the Effective Date.
Following the expiration of the Term or the earlier completion of development of the
Project and satisfaction of all of Developer's obligations in connection therewith, this Agreement
shall be deemed terminated and of no further force and effect.
2.2.2 Memorandum of Extension. If the Extension Term is granted, City and
Developer agree to execute, acknowledge and record in the Official Records of Santa Clara
County a memorandum evidencing approval of the Extension Term.
2.2.3 Tolling of Term. The Initial Term shall be extended for the time period
between the date of adoption of the Specific Plan Approvals and the second reading of the
adoption of the Enacting Ordinance and until and the date the Vested Approvals are Final;
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provided, however, the maximum time period by which the Initial Term shall be extended under
this Section shall not exceed five (5) years.
2.2.4 Termination for Commencement of SB 35 Project. If Developer
commences construction or installation of Project Specific Work, that is not Project Neutral
Work, for the SB 35 Project, then Developer shall pay City within 30 days following City's
demand therefor an amount equal to 50% of the reasonable out-of-pocket costs and expenses
incurred by City in connection the design and planning for the New City Hall, not to exceed
Three Million Dollars ($3,000,000) (the "SB 35 City Hall Payment"), and this Agreement shall
automatically terminate and the Parties shall have no further obligation to one another thereunder
except for those obligations which by their terms survive expiration or termination hereof.
Developer's obligation to make the SB 35 City Hall Payment shall survive termination of this
Agreement. Upon either Party's written request following such termination, the other party shall
execute and acknowledge a recordable notice of termination or other similar instrument
memorializing termination of this Agreement.
2.2.5 SB 35 Project Termination. If Developer commences construction or
installation of Project Specific Work not including any Project Neutral Work, for the Project
described in this Agreement and the Vested Approvals or for a Tier 1 development project, then
the SB 35 Project Approvals will thereupon be deemed to be terminated and of no further force
and effect and Developer shall take any and all steps as may be deemed necessary by City to
memorialize termination of the SB 35 Project approvals.
2.2.6 Project Neutral Work. Prior to obtaining a permit or other authorization
for work that Developer believes is Project Neutral Work, Developer shall identify to City with
its application submittal whether it considers the proposed work to be Project Neutral Work, and
the reasons therefor. If City disagrees, City shall provide Developer with written notice thereof
and an explanation of the reasons it considers the work to be Project Specific Work prior to its
issuance of the applicable permit or authorization for such work. If Developer disagrees,
Developer may provide a written response explaining why the work is Project Neutral Work.
The Parties will meet and confer in good faith and attempt to resolve any disagreement as to
whether work is Project Neutral Work or Project Specific Work. If Developer commits to the
Project, a Tier 1 development project or the SB 35 Project, by commencing performance of
Project Specific Work, in accordance with Section 2.2.4 or 2.2.5, City shall give notice thereof to
Developer in accordance with this Agreement, including a written explanation for why the work
is not Project Neutral Work, provided that City shall not designate as Project Specific Work any
work that City, prior to issuance of the permit or authorization for such work, had previously
identified as Project Neutral Work. Regardless of the foregoing and except as otherwise
provided herein, the Parties acknowledge and agree that the following shall be considered Project
Neutral Work: demolition, rough grading, make-ready utility work, offsite work, excavation and
shoring the scope of which has been mutually agreed upon by the Parties, and such other work as
the Parties may mutually agree (collectively, "Project Neutral Work").
2.2.7 Tier 1 Project Termination. If Developer commences construction or
installation of Project Specific Work, that is not Project Neutral Work, for the Project described
in this Agreement in a manner which is inconsistent with a Tier 1 development project, then the
Developer's Tier 1 Vested Approvals will thereupon be deemed to be terminated and of no
13
further force and effect and Developer agrees to take any and all steps as may be deemed
necessary by City to memorialize termination of the Tier 1 Vested Approvals under this
Agreement. If, however, Developer elects to move forward with any of the Article 5 Community
Benefits applicable to the Project before Developer has proceeded with construction of Project
Specific Work, which would be inconsistent with a Tier 1 project, Developer shall have the right
to subsequently elect to move forward with a Tier 1 project, provided it diligently proceeds to
complete or satisfy the particular community benefit it had commenced.
2.3 City Representations and Warranties¶ City represents and walTants to Developer
that, as of the Effective Date:
2.3.1 City is a municipal corporation, and has all necessary powers under the
laws of the State of California to enter into and perform the undertakings and obligations of City
under this Agreement.
2.3.2 The execution and delivery of this Agreement and the performance of the
obligations of the City hereunder have been duly authorized by all necessary City Council action
and all necessary approvals have been obtained.
2.3.3 This Agreement is a valid obligation of City and is enforceable in
accordance with its terms.
During the Term of this Agreement, City shall, upon learning of any fact or condition
which would cause of any of the warranties and representations in this Section 2.3 not to be true,
immediately give written notice of such fact or condition to Developer.
2.4 Developer Representations and Warranties¶ Developer represents and warrants to
City that, as of the Effective Date:
2.4.1 Developer is duly organized and validly existing under the laws of the
State of Delaware, and is in good standing and has all necessary powers under the laws of the
State of California to own property interests and in all other respects enter into and perform the
undertakings and obligations of Developer under this Agreement.
2.4.2 The execution and delivery of this Agreement and the necessary
performance of the obligations of Developer hereunder have been duly authorized by all
necessary company action and all necessary approvals have been obtained.
2.4.3 This Agreement is a valid obligation of Developer and is enforceable in
accordance with its terms.
2.4.4 Developer has not (a) made a general assignment for the benefit of
creditors; (b) filed any voluntary petition in bankruptcy or suffered the filing of any involuntary
petition by Developer's creditors; (c) suffered the appointment of a receiver to take possession of
all, or substantially all, of Developer's assets; (d) suffered the attachment or other judicial seizure
of all, or substantially all, of Developer's assets; or (e) admitted in writing its inability to pay its
debts as they come due.
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During the Term of this Agreement, Developer shall, upon learning of any fact or
condition which would cause any of the warranties and representations in this Section 2.4 not to
be true, immediately give written notice of such fact or condition to City.
ARTICLE 3
DEVELOPMENT OF THE PROPERTY
3.1 Vested Rightsl The Property is hereby made subject to the provisions of this
Agreement. Developer shall have the vested right to develop the Property and the Project in
conformance with the Vested Approvals, the Subsequent Approvals, Applicable Law and this
Agreement, as amended from time to time pursuant to this Agreement, which shall control the
permitted uses, density and intensity of use of the Property and the maximum height and size of
buildings on the Property
3.2 Limited Vested Rights for Tier 1 Project¶ Developer shall have a limited vested
right to develop a Tier 1 development project only in accordance with the Tier 1 Vested
Approvals for a period not to exceed Five (5) years from the Effective Date ("Tier 1 Term").
The applicable Tier 1 vested rights shall not extend to the Impact Fee Lock Period described in
Section 4.1 or to other rights or obligations set forth in this Agreement, except as expressly
provided. However, the limited vested rights protections for the Tier 1 Vested Approvals shall
extend to all the basic Article 3 rights and obligations set forth in this Agreement.
3.3 Life of Approvals¶ Pursuant to Government Code section 66452.6(a) and this
Agreement, the life of Subsequent Approvals for the Project shall automatically be extended to
and until the later of the following: (1) the end of the Term of this Agreement; or (2) the end of
the term or life of any such Subsequent Approval. Notwithstanding the foregoing, the vested
elements secured by Developer under this Agreement shall have a life no greater than the Term
of this Agreement, and in the case of a Tier 1 development project no greater than the Tier 1
Term.
3.4 Permitted Uses. The permitted uses of the Property; the density and intensity of
use of the Property, including the number and type of residential units, and square footage or
amounts of office, Office Amenity Space, retail, open space, allocation of hotel rooms, and other
uses; the maximum height and size of proposed buildings; provisions for reservation or
dedication of land for public purposes, the general location of public improvements; the general
location of public utilities; and other terms and conditions of development applicable to the
Project, are generally set forth in the Vested Approvals and, as and when they are issued (but not
in limitation of any right to develop as set forth in the Vested Approvals), the Subsequent
Approvals. To the extent the Project requires "development allocation" pursuant to General Plan
Policy LU -1.2, Developer shall have a vested right to all development allocation required for the
Project.
3.5 Water Supplies. Any tentative map prepared for the Project will comply with the
provisions of Government Code Section 66473.7.
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3.6 Applicable Cit�Regulations¶ The laws, rules, regulations, official policies,
standards and specifications of City applicable to the development, use and operation of the
Property and the Project shall be (collectively, "Applicable City Regulations"):
a) Those rules, regulations, official policies, standards and specifications of
the City set forth in the Vested Approvals, the Subsequent Approvals, and this Agreement;
b) With respect to matters not addressed by and not otherwise inconsistent
with the Project Approvals and this Agreement, those laws, rules, regulations, official policies,
standards and specifications (including City ordinances and resolutions) governing permitted
uses, building locations, timing and manner of construction, densities, intensities of uses,
maximum heights and sizes, design, set -backs, lot coverage and open space, parking,
requirements for on- and off-site infrastructure and public improvements, fees, taxes and
Exactions, in each case only to the extent in full force and effect on the Effective Date;
C) Except as addressed in the Vested Approvals, New City Laws that relate
to hearing bodies, petitions, applications, notices, findings, records, hearings, reports,
recommendations, appeals and any other matter of procedure imposed at any time; provided, that
such New City Laws are uniformly applied on a City-wide basis to all substantially similar types
of development projects and properties and such procedures are not inconsistent with procedures
set forth in this Agreement;
d) New City Laws that revise City's uniform construction codes, including
City's building code, plumbing code, mechanical code, electrical code, fire code, grading code
and other uniform construction codes, as of the date of permit issuance; provided, that such New
City Laws are uniformly applied on a City-wide basis to all substantially similar types of
development projects and properties;
e) New City Laws that are necessary to protect physical health and safety of
the public; provided, that such New City Laws are uniformly applied on a City-wide basis to all
substantially similar types of development projects and properties;
f) New City Laws that do not conflict with this Agreement, the Vested
Approvals or the Subsequent Approvals; provided, that such New City Laws are uniformly
applied on a City-wide basis to all substantially similar types of development projects and
properties; and
g) New City Laws that do not apply to the Property and/or the Project due to
the limitations set forth above, but only to the extent that such New City Laws are accepted in
writing by Developer in its sole discretion.
3.7 Timing of Development. Except as described in the Phasing Plan, Exhibit C, and
the Housing Plan, Exhibit D, there is no requirement under this Agreement that Developer
initiate or complete development of the Project, or any portion thereof, or that development be
initiated or completed within any period of time or in any particular order, except that Developer
shall meet its obligation to provide the public benefits described in Article 5 within the times
provided therein, subject to City meeting its performance obligations and to events of Permitted
Delay. Development of the Project is subject to numerous factors that are not within the control
16
of the Developer, such as the availability of financing, interest rates, access to capital and other
factors. However, and not in limitation of any of the foregoing, since the California Supreme
Court held in Pardee Construction Co. v. City of Camarillo, 37 Ca1.3d 465 (1984), that the
failure of the parties therein to consider, and expressly provide for, the timing of development
resulted in a later -adopted initiative restricting the timing of development to prevail over such
parties' agreement, it is the desire of the Parties hereto to avoid that result. Therefore,
notwithstanding the adoption of an initiative after the Effective Date by City's electorate to the
contrary, the Parties acknowledge that, except as otherwise provided for in the Vested
Approvals, Developer shall have the vested right (but not the obligation) to develop the Project
in such order and at such rate and at such times as Developer deems appropriate in the exercise
of its sole and subjective business judgment.
3.8 Compliance with Laws¶ Developer, at its sole cost and expense, shall comply
with the requirements of, and obtain all permits and approvals required by local, State and
Federal agencies having jurisdiction over the Property, the Project or the New City Hall.
Furthermore, Developer shall carry out the Project and, if applicable, the New City Hall work in
conformity with all Applicable Law, including applicable state labor laws and standards;
Applicable City Regulations; and all applicable disabled and handicapped access requirements,
including the Americans With Disabilities Act, 42 U.S.C. section 12101, et seq., Government
Code section 4450, etseq., Government Code section 11135, et seq., and the Unruh Civil Rights
Act, Civil Code section 51, et seq.
3.9 No Conflicting Enactments¶ Except as otherwise provided in this Agreement,
City shall not impose on the Project (whether by action of the City Council or by initiative,
referendum or other means, including development moratorium or additional Project conditions
on Subsequent Approvals) any New City Law that is in conflict with this Agreement, the Vested
Approvals or, once approved, the Subsequent Approvals. Without limiting the generality of the
foregoing, City shall not (a) apply to the Property any change in land use designation or
permitted use, density or intensity of development of the Property; (b) except as provided in
Section 7.3.3 below, apply to the Property any change in off-site infrastructure or utility
requirements or limit or control the availability of or ability to obtain public utilities, services, or
facilities (provided, however, nothing herein shall be deemed to exempt the Project or the
Property from any water use rationing requirements that may be imposed from time to time in
the future and nothing herein shall be deemed a commitment to reserve potable water or sanitary
sewer capacity which the Parties acknowledge City does not control); (c) limit square footages of
permitted uses or the number of permitted residential units (based upon the presumed general
Project average unit size of 1,250 gross square feet assumed in the Specific Plan), or modify
parking requirements or access in a manner that is inconsistent with the Project Approvals; (d)
increase minimum setbacks above, or decrease maximum heights below, the levels specified in
the Vested Approvals; (e) limit or control the rate, timing, phasing or sequencing of the
development or construction of all or any part of the Project other than as set forth herein; (f)
apply to the Project any New City Law or Exaction otherwise allowed by this Agreement that is
not uniformly applied on a City-wide basis to all substantially similar types of development
projects and project sites; (g) take any action that would require the issuance of Subsequent
Approvals by the City other than those required by Applicable Law or the Vested Approvals; (h)
impose against the Project any dedication or Exaction not specifically authorized by this
Agreement, the Project Approvals or Applicable Law; (i) limit or impede the processing or
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procuring of applications and approvals of Subsequent Approvals; 0) impose restrictions or
conditions in connection with Subsequent Approvals other than reasonable conditions
appropriate to implementing a development project of the scope and scale of the Project and in
all instances consistent with the objectives, goals and policies of the Specific Plan.
3.10 Changes in the Law¶ As provided in section 65869.5 of the Development
Agreement Law, this Agreement shall not preclude the applicability to the Project of changes in
laws, regulations, plans or policies, to the extent that such changes are specifically mandated and
required by changes in State or Federal laws or by changes in laws, regulations, plans or policies
of special districts or other governmental entities, other than the City, created or operating
pursuant to the laws of the State of California ("Changes in the Law"). In the event Changes in
the Law prevent or preclude compliance with one or more provisions of this Agreement, the
Parties shall meet and confer in good faith in order to determine whether such provisions of this
Agreement shall be modified or suspended, or performance thereof delayed, as may be necessary
to comply with Changes in the Law. Nothing in this Agreement shall preclude Developer from
contesting by any available means (including administrative or judicial proceedings) the
applicability to the Project of any such Changes in the Law.
3.11 Initiatives and Referenda¶ If any New City Law is enacted or imposed by
initiative or referendum, or by the City Council directly or indirectly in connection with any
proposed initiative or referendum, which New City Law would conflict with this Agreement or
reduce the development rights provided by this Agreement and Project Approvals, such New
City Law shall not apply to the Project. No moratorium or other limitation (whether relating to
the rate, timing, phasing, density, height or sequencing of development) affecting subdivision
maps, building permits or other entitlements to use that are approved or to be approved, issued or
granted within the City, or portions of the City, shall apply to the Project. City, except to submit
to vote of the electorate initiatives and referendums required by Applicable Law to be placed on
a ballot, shall not adopt or enact any New City Law, or take any other action which would violate
the express provisions of this Agreement or the Project Approvals. To the maximum extent
permitted by law, City shall cooperate with Developer, at Developer's expense, to prevent any
New City Law from invalidating or prevailing over all or any part of this Agreement, and City
shall cooperate with Developer and shall undertake such actions as may be necessary to ensure
this Agreement remains in full force and effect. City shall not support, adopt or enact any New
City Law, or take any other action which would violate the express provisions or spirit and intent
of this Agreement, the Vested Approvals or the Subsequent Approvals. Developer reserves the
right to challenge in court any New City Law that would conflict with this Agreement or reduce
the development rights provided by this Agreement. Notwithstanding the foregoing, the Parties
acknowledge that City's approval of this Agreement is a legislative action subject to referendum.
3.12 Regulation by Other Public A eg ncies¶ Developer acknowledges that other public
agencies not within the control of City possess authority to regulate aspects of the development
of the Property separately from or jointly with City, and this Agreement does not limit the
authority of such other public agencies. Developer will, at the time required in accordance with
Developer's construction schedule, apply for all such other permits and approvals as may be
required by other governmental or quasi -governmental entities in connection with the
development of, or the provision of services to, the Project. Developer acknowledges that City
does not control the amount of any fees imposed by such other agencies. In the event that such
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fees are imposed upon Developer and are in excess of those allowed by Applicable Law and
Developer wishes to object to such fees, Developer may pay such fees under protest. City agrees
not to delay issuance of permits or other Subsequent Approvals and entitlements under these
circumstances, provided Developer provides City with proof of payment of such fees.
3.13 Public Infrastructure¶ City shall use good faith, diligent efforts to work with
Developer to ensure that all public infrastructure required in connection with the Project is
expeditiously reviewed and considered for acceptance by City on a phased basis as discrete
components of the public infrastructure is completed. Developer's obligation to construct the
public improvements shall be set forth in one or more public improvement agreements to be
entered into by the Parties on or before approval of final subdivision maps for the Project
3.14 Sanitary Sewer Capacity. As of the Effective Date, City believes, based on
existing sewer capacity studies, that Cupertino Sanitary District's contractual capacity limits with
respect to use of the City of Santa Clara sanitary sewer system are adequate to serve the Project
as well as all other development contemplated by the City's General Plan in effect as of the
Effective Date. Accordingly, subject to continued accuracy of those capacity studies and
assumptions and subject to the limits of its authority, City agrees to reserve sanitary sewer
capacity for the Project as follows:
a) For the first five (5) years following the Effective Date, City agrees to act
in good faith to ensure that new development projects being considered for approval by City
within such time period will not, in combination with the Project, cause permitted peak wet
weather flow to exceed Cupertino Sanitary District's contractual sanitary sewer capacity limits.
b) If upon the fifth (5th) anniversary of the Effective Date, Developer has
pulled building permits for 33% of the total number of residential units and 33% of the total
commercial square footage within the Project, then until the 8th anniversary of the Effective
Date, City agrees to act in good faith to ensure that new development projects being considered
for approval by City will not, in combination with the remaining un-built portion of the Project,
cause permitted peak wet weather flow to exceed Cupertino Sanitary District's contractual
sanitary sewer capacity limits. If Developer fails to meet the foregoing 5th anniversary
development milestone, then City shall have no obligation to continue reserving for the Project
any of Cupertino Sanitary District's contractual sanitary sewer capacity limits.
C) If upon the eighth (8th) anniversary of the Effective Date, Developer has
pulled building permits for 66% of the total number of residential units and 66% of the total
commercial square footage within the Project, then until the expiration of the Initial Term, City
agrees to act in good faith to ensure that new development projects being considered for approval
by City will not, in combination with the remaining un-built portion of the Project, cause
permitted peak wet weather flow to exceed Cupertino Sanitary District's contractual sanitary
sewer capacity limits. If Developer fails to meet the foregoing 8th anniversary development
milestone, then City shall have no obligation to continue reserving for the Project any of
Cupertino Sanitary District's contractual sanitary sewer capacity limits.
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d) In all events, following expiration of the Initial Term, City shall have no
obligation to reserve for the Project any of Cupertino Sanitary District's contractual sanitary
sewer capacity limits.
Notwithstanding any other provision hereof to the contrary, if, following the Effective Date,
updates of existing sanitary sewer capacity studies reveal that there is inadequate capacity to
serve both the Project and all other development projects contemplated under the City's General
Plan in effect as of the Effective Date, then the sanitary sewer capacity amounts to be reserved
by City under this Section 3.14 shall be reduced proportionately based on the amount of the
capacity shortfall as identified in the updated study.
ARTICLE 4
FEES
4.1 Impact Fees¶ Except as otherwise expressly provided herein, for eight (8) years
from the Effective Date, subject to no more than a cumulative two-year extension for Permitted
Delays ("Impact Fee Lock Period"), City shall have the right to impose and Developer shall
pay only those Impact Fees, as adopted as of the Effective Date, as and when due under those
existing adopted Impact Fees. During the Impact Fee Lock Period, the City may increase the
existing adopted Impact Fees by the amount of any built in escalators, or in the absence of a built
in escalator, by the annual increase in the cumulative Consumer Price Index for All Urban
Consumers ("CPI -U"), as defined in Cupertino's CMC Section 5.04.460 (and as reflected in the
most recent report of consumer prices for the San Francisco/Bay Area Standard Metropolitan
Statistical Area as published by the U.S. Department of Labor, Bureau of Labor Statistics) or if
such index is no longer available by a comparable index as reasonably selected by City. Except
as otherwise provided in this Agreement, during the Impact Fee Lock Period no other increases
to Impact Fees in existence on the Effective Date and no new City Impact Fees imposed after the
Effective Date shall apply to the Project. Absent agreement of the Parties, Impact Fees will be
paid when specified under this Agreement or, in the absence of any specified time frame, when
due under the City Municipal Code. Developer will have the right, at any time during the Impact
Fees Lock Period to pre -pay any future Impact Fees at the then applicable rate. Following
expiration of the Impact Fee Lock Period, Developer shall pay all applicable Impact Fees,
including Impact Fees adopted by City after the Effective Date, at the rates in effect when due.
4. 1.1 Transportation Impact Fee. City shall give credit to Developer for (i) the
reduction of existing non-residential uses and (ii) any transportation improvements Developer
funds and constructs that are capital projects identified by the Transportation Impact Fee
Program ("TIF"). Credit given under clause (ii) above shall be based on the engineer's cost
estimate used as a basis for establishing the TIF. If Developer still owes a TIF after accounting
for the credits, Developer will pay the applicable TIF, upon issuance of each building permit.
City agrees that no TIF will be charged for Office Amenity Space, or for BMR Units or for the
PAC or Adult School and Innovation Center (to the extent City and/or FUHSD elect to accept
delivery of the PAC or Adult School and Innovation Center spaces for the designated civic uses).
4.1.2 Parkland Fees. Developer will satisfy park and open space requirements
and no park fees will be required, provided the Project includes a minimum of 11.5 acres of
privately maintained open space and parks, which meet the design standards, guidelines and
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requirements set forth in the Vested Approvals and this Agreement. At least 6 acres will be "At
Grade" (described in the Vallco Specific Plan as generally at the level of adjacent sidewalk
12 inches]) publicly accessible park and open space. The minimum 6 acre At Grade park
requirement shall be satisfied by providing publicly accessible, privately maintained At Grade
park/plaza space in lieu of dedicated City owned and maintained spaces. Developer will be
given Park Land Impact Fee credit for parks/plaza open space, as follows:
(i) At Grade publicly accessible park and open space: 100% credit
(ii) Publicly accessible park and open space not At Grade: 100%
credit
(iii) Private non -publicly accessible Open Space which meets the
requirements of the Open Space types in the Specific Plan: 50%
credit (i.e. 1 square foot credited for every 2 square feet provided,
without limitation)
Sidewalks, cycle tracks, multi -use paths and other trails or pathways within traditional parks and
open space shall be given credit if designed to be closed temporarily for events and gatherings,
but only if such sidewalks and pathways are part of the park or open space and meet all Specific
Plan requirements.
4.1.3 Affordable Housing Fee. Developer shall pay the City's Affordable
Housing Fee at the rate in effect on the Effective Date, subject to CPI increases allowed under
Section 4. 1, and subject to the following credits:
(i) Non -Residential Use Credit. Developer will receive a credit
against any affordable housing fees otherwise owed for non-
residential uses removed and replaced with new non-residential
(i.e., retail, hotel and office) uses. All credits and fees for
non-residential uses shall be calculated at the office rate.
(ii) Moderate Unit Credit. Because the Project includes 15% very low
and low income BMR Units, no Affordable Housing Impact Fee is
due with respect to the residential component of the Project.
Developer will also receive a credit towards Affordable Housing
Impact Fees imposed in connection with the non-residential
components of the Project in the total amount of Five Million
dollar ($5,000,000) for the 133 moderate BMR Units which exceed
the base 15% inclusionary requirement.
4.1.4 Impact Fee Exemptions for BMR Units, Office Amenity Space and Civic
Facilities. The City shall not apply any Impact Fees to any of the PAC, Office Amenity Space,
Adult School and Innovation Center (if and to the extent City and/or FUHSD elect to accept
delivery of such spaces for the designated Civic uses) or the BMR Units within the Project
4.1.5 No Rebates. Developer shall not be eligible to receive, and City shall
have no obligation to pay funds to Developer, if the credits associated with facilities and
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improvements constructed or installed by Developer exceed the total amount of the applicable
Impact Fees due for the Project.
4.2 Processing Fees. Subject to Developer's right to protest and/or pursue a challenge
in law or equity to any new or increased Processing Fee, City may charge and Developer agrees
to pay all cost recovery fees, including fees for processing Subsequent Approvals, and further
including any required supplemental or other further environmental review, plan checking and
inspection and monitoring ("Processing Fees"), at the rates which are in effect on a City-wide
basis at the time those permits, approvals, entitlements, review or inspections are applied for or
requested.
4.3 Other Agency Fees¶ Nothing in this Agreement shall preclude City from
collecting fees from Developer that are lawfully imposed on the Project by another agency
having jurisdiction over the Project, which the City is required to collect pursuant to Applicable
Law.
4.4 Taxes and Assessments¶ City may impose and Developer agrees to pay any and
all existing, new, modified or increased taxes and assessments imposed in accordance with the
laws in effect as of the date due, at the rate in effect at the time of payment, including without
limitation, the construction taxes imposed by Chapter 3.32 of the Municipal Code
("Construction Tax"). The City acknowledges and agrees that the Construction Tax shall not
apply to the BMR Units, PAC or Adult School and Innovation Center (if and to the extent City
and/or FUHSD elect to accept delivery of such spaces for the designated civic uses). If
Construction Tax is applicable to New City Hall, City will be responsible to pay the tax.
4.5 Connection Fees. Subject to Developer's right to protest and/or pursue a
challenge in law or equity to any new or increased Connection Fee, City may charge and
Developer shall pay any Connection Fee that is lawfully adopted and applicable City-wide with
respect to similarly situated properties or uses. In calculating City imposed Connection Fees, if
any, City will give credit for applicable removed facilities.
4.6 Right to Challenge Fees¶ Developer reserves the right to protest or pursue a
challenge in law or equity to any new or increased fee. In the event Developer desires to
challenge such new or increased fee, Developer shall pay the fee under protest. The City agrees
not to delay issuance of permits, approvals or entitlements pending resolution of such protest or
challenge to the fee.
ARTICLE 5
PUBLIC BENEFITS
5.1 Performing Arts Centel
5. 1.1 Feasibility Study. Commencing within ninety (90) days after the Effective
Date of this Agreement, City will commence a feasibility study for an approximately 60,000
square foot performing arts center, including 600 seat main auditorium, 200 seat secondary
auditorium, lobby and concession areas, restrooms etc., located in the vicinity of the Town
Square ("PAC").
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5.1.2 Core and Warm Shell. Based on the feasibility study City may elect either
(i) to receive a payment from Developer in the total amount of Twenty Two Million Eight
Hundred Thousand Dollars ($22,800,000) ("PAC In Lieu Payment"), or (ii) for Developer to
construct and deliver to City a Warm Shell (defined below) PAC space which City shall be
responsible for completing and maintaining. If City elects for Developer to build the PAC,
Developer's obligation is for a maximum of a 60,000 square foot Warm Shell space. The space
would be intended to optimize ability to accommodate a main theater of approximately 600
seats, a second stage of no more than 200 seats, lobby to host pre -theater events, ticketing space
and food preparation and staging area, and appropriate number of finished restrooms in light of
the size of the facility, among other things. The "Warm Shell" space scope will include (i) an
enclosed box with roof, exterior walls/finishes and floor completed and the exterior envelope to
have Project standard glazing, roofing and exterior exiting doors as required by code; (ii) stub
out of all required utilities at an agreed upon location within the structure, (iii) its own HVAC
units available at plenum for tenant improvement to connect for their distribution; and (iv) a fire
sprinkler stand pipe for the tenant work distribution. The specific requirements for the Warm
Shell scope will be detailed in the three alternative design options described in Section 5.1.3.
Following delivery of the Warm Shell space City shall be responsible for completing all front
and back of house tenant improvements, including theatre seating, and lobby and concession area
fixturization. In addition to the Warm Shell work, Developer shall provide City, at no charge to
City, 150 parking stalls within Retail and Entertainment/Mixed Use District (as defined in the
Specific Plan) and within reasonable proximity to the PAC, which will be subject to project -wide
shared parking strategies, and reasonable relocation from time to time depending on leasing or
operational requirements.
5.1.3 MSDP/Design. The MSDP shall include two scenarios with respect to the
PAC, one that includes a PAC generally located in the Retail District/Phase 1 area, and one that
does not include a PAC. With the submittal of the MSDP, Developer will also provide up to
three (3) alternative design options, including conceptual program lay -outs, for City
consideration concurrently with, but separate from, the review of the MSDP. Within six (6)
months of Developer submittal of the MSDP application, the City shall elect whether to include
the PAC at the location proposed by Developer in the MSDP, or to approve the MSDP without
the PAC.
5.1.4 Cash Election. If City approves the MSDP without the inclusion of a
PAC, then Developer shall pay to City the PAC In Lieu Payment prior to issuance of the
certificate of occupancy for the last office building in the Office/Mixed-Use District which is not
Amenity Office Space, as shown on the MSDP.
5.1.5 Construction of PAC. If City approves the MSDP with the PAC, it shall
also, at that time, elect one of the design alternatives provided by Developer. Developer shall
design and construct the PAC to Warm Shell level of completion together with the associated
parking, in the location shown on the approved MSDP, consistent in all material respects with
the design selected by the City, provided that Developer shall have no obligation to commence
design and construction of the PAC until the Vested Approvals and the approvals for the MSDP
and Master Tentative Map are Final. Developer shall provide a one (1) year warranty for the
Warm Shell PAC space; warranties and guarantees for other systems and components of the
PAC space, including HVAC, will be provided per industry standard.
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5.1.6 Delivery. Developer shall deliver to City a completed Warm Shell, PAC
and associated parking as described above, provide City with a complete set of as -built plans and
drawings, and the warranties and guarantees referenced in Section 5.1.5 above, prior to issuance
of a certificate of occupancy for the last building in the Project located west of Wolfe Road. City
and Developer shall collaborate on the plans, specifications and drawings for the PAC. City will
be solely responsible for all costs, fees and expenses, including permitting, to design and
construct the interior tenant improvements for the PAC, and all other associated amenities,
facilities and improvements (other than the Warm Shell improvements and PAC parking the
costs of which shall be paid by Developer), and thereafter to operate, and following expiration of
the warranty period, to maintain and repair the PAC. Developer shall provide City with a 34
year lease for the PAC premises and parking at a rent of $1 per year on a NNN basis. The Lease
term shall commence as of the date Developer delivers a complete (other than minor punch list
items) Warm Shell PAC space to City. City, as PAC tenant, will participate in the Project's
master property owners' association and pay a proportionate fair share cost contribution for
typical common area maintenance in the Retail and Entertainment/Mixed Use District. If the
PAC is constructed but ultimately the City fails to accept and operate it, the City PAC lease shall
terminate and the PAC may be used as entertainment space, with any of the uses allowed in the
Retail Mixed Use District component, including co -working or event space, subject to any
further CEQA review.
5.1.7 PAC Agreements. Developer shall prepare a term sheet for the
improvement and lease agreements referenced below generally at the same time as its MSDP
application, and prior to construction and issuance of PAC building permits, or at such later time
as City and Developer may mutually agree each in its discretion, City and Developer shall
prepare and execute forms of improvement and lease agreements setting forth in greater detail
their respective obligations with respect to design, development, delivery and leasing of the
PAC. The PAC improvement agreement shall address among other issues, requirements for
collaboration on design, labor and materials and performance bonds, completion guarantee,
process for submittal and approval of change orders, and warranty requirements. If the Parties
are unable to achieve the schedule dates due to disagreements, the Parties shall meet and confer
in good faith to resolve such disagreements and, if necessary, enter into mediation pursuant to
Section 12.8 below.
5.2 City Hall¶
5.2.1 City Election for Developer Construction. City may, in its discretion,
elect either: (a) for Developer to construct, at Developer's cost, the core and Warm Shell for a
new City Hall building, including 118 underground parking stalls and associated site work, all as
more particularly described in Exhibit G ("New City Hall"), that would replace the existing City
Hall ("Existing City Hall") at the same site as the Existing City Hall; or (ii) receive in lieu
thereof the total sum of Thirty Million Dollars ($30,000,000.00) ("City Hall Payment"). If City
elects to receive the City Hall Payment, Developer shall pay the full amount of such City Hall
Payment prior to issuance of the certificate of occupancy for the first office building in the Office
/ Mixed -Use District (as defined in the Specific Plan).
5.2.2 Design Criteria and Design Process. If City elects to have Developer
construct the New City Hall, City will be solely responsible for designing, preparing construction
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documents and obtaining all necessary discretionary approvals and building permits for the New
City Hall. The New City Hall, including underground parking and certain site work, will be
designed consistent with conceptual plans contained in the Cupertino Civic Center Master Plan
approved by the City Council on July 7, 2015, as modified by the criteria described in Exhibit G
(collectively, the "New City Hall Criteria"). Except as otherwise agreed by Developer in its
sole absolute discretion, the New City Hall (exclusive of the underground parking) will not
exceed 40,000 square feet. City will consult and coordinate with Developer during each phase of
design and construction document preparation, for the purpose of ensuring that the New City
Hall project remains consistent with the New City Hall Criteria. The Parties also agree that the
target budget (not including Design Deviations) for a New City Hall consistent with the New
City Hall Criteria, assuming commencement of construction within 24 months, is Thirty One
Million Dollars ($31,000,000) and City will consider in good faith (but shall have no obligation
to accept) reasonable proposed design or value engineering changes that Developer proposes to
keep construction costs of the New City Hall within that target budget, provided that such
proposals are consistent with the New City Hall Criteria. Developer may elect to check pricing
of the City's design at: (1) concept completion, (2) 50% schematic design, (3) 100% schematic
design, (4) 50% design drawings, (5) 100% design drawings, and (6) 50% construction drawings,
and (7) 100% construction drawings, or such other design stages as the Parties may mutually
agree. Developer acknowledges that pursuant to section 5.2.4 the City has 21 months to reach
City Hall Approval and will provide any requests for design or value engineering proposals
expeditiously and in a manner that will not delay City's design process schedule or impede
City's ability to timely reach City Hall Approval. To expedite the design and review process and
ensure that the City can meet its timing obligations in Section 5.2.4, the Parties shall establish an
overall timeline and process for Developer's participation.
5.2.3 CEQA. The environmental impacts of replacing the Existing City Hall
with the proposed New City Hall were evaluated in the May 2015 Cupertino Civic Center Master
Plan Initial Study, incorporated herein by reference. City adopted a Mitigated Negative
Declaration for the Cupertino Civic Center Master Plan project and approved the plan on July 7,
2015, by City Council Resolution No. 15-060. To the extent any supplemental CEQA analysis is
required in connection with City's review and further approval of the New City Hall, City shall
be solely responsible for such supplemental CEQA review and compliance and City reserves full
and complete discretion with respect thereto, including the authority to impose and implement
such further mitigation measures, if any, as may be required to mitigate the impacts of the
proposed New City Hall or decide not to proceed with the New City Hall.
5.2.4 Ci 's Design and Approval of New City Hall. City will commence
design work, and initiate any public review process City may require or desire, within 30 days
following the Effective Date. Thereafter, City will diligently and as expeditiously as practicable
proceed with any discretionary and ministerial approvals for the New City Hall, including any
required architectural approvals, preparation of construction documents and permitting,
including, but not limited to issuance of, as applicable, demolition, tree removal, make-ready
utilities, excavation and building permits, and all applicable third party applications, approvals,
permits and authorizations ("City Hall Approval"), and shall complete such City Hall Approval
within 21 months of the Effective Date, subject to extension as provided herein or as may
otherwise be agreed by the Parties, each in its sole discretion. By entering into this Agreement
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City is making no commitment to achieve the City Hall Approval and the Parties acknowledge
that at any point City may opt for the City Hall Payment in lieu of the New City Hall.
5.2.5 Vacation of Existing City Hall. In order to allow for Developer's timely
construction of the New City Hall, City shall vacate the Existing City Hall and deliver possession
of the Existing City Hall site to Developer for construction within 24 months of the Effective
Date, subject to extension as provided herein or as may otherwise be agreed by the Parties, each
in its sole discretion. In order to plan for and coordinate the vacation of the Existing City Hall,
the Parties shall meet and confer on a regular basis on the status of City's relocation plans.
5.2.6 Developer Election to Construct or Pay. Developer will have no
obligation to construct the New City Hall unless (i) the City has met all of its obligations and
schedule timelines (as such timelines may be extended) in accordance with Section 5.2.4 and
5.2.5, and (ii) the Vested Approvals and the MSDP and the Master Tentative Map approvals are
each Final, or as may otherwise be agreed by Developer in its sole discretion. .
5.2.7 Extension of Timelines under Certain Limited Circumstances.
a) Extensions for Delayed MSDP and Master Tentative May Submittal. If,
for reasons other than a Permitted Delay, Developer submits the MSDP and Master Tentative
Map applications more than 12 months and 18 months, respectively, after the Effective Date,
then the timelines in Sections 5.2.4 and 5.2.5 shall each be extended day for day for each day
after month 12 and 18, respectively, that such applications are submitted.
b) Extension of Timeline Due to Litigation Challenge, Referendum or
Initiative. If as a result of a Litigation Challenge, referendum or initiative any of the Vested
Approvals, the MSDP approval or the Master Tentative Map approval are not Final by the date
that is 21 months after the Effective Date, the timeline to vacate the Existing City Hall and for
Developer to commence construction shall each be extended until such time that all of such
approvals become Final, subject to an outside date that is 48 months after the Effective Date, at
which point Developer may, in its sole discretion, elect to make the City Hall Payment. Although
Developer will maintain the obligation to construct City Hall if there is a Litigation Challenge,
referendum or initiative pending, City shall be responsible for any increased costs resulting from
the delay in commencement of construction past 24 months after the Effective Date ("Increased
Construction Cost"). Increased Construction Costs shall be determined as follows. If a
Litigation Challenge, referendum or initiative is pending 21 months after the Effective Date,
Developer shall seek at least three bids and the lowest qualified bid shall establish the baseline
cost for the New City Hall (`Baseline Cost"). At the time the Litigation Challenge, referendum
or initiative is favorably resolved, Developer shall seek at least three bids priced based on the
expected date construction will commence and the lowest qualified bid shall establish the
updated cost for the New City Hall ("Updated Cost"). The Increased Construction Cost shall
consist of the difference between the Baseline Cost and the Updated Cost. If (i) there is a
Litigation Challenge, referendum or initiative challenging the Vested Approvals, and (ii)
Developer elects to delay submittal of its MSDP and/or Master Tentative Map applications as a
result of the Litigation Challenge, referendum or initiative, and (iii) the Litigation Challenge,
initiative or referendum is favorably resolved prior to the date that is 48 months after the
Effective Date, then the Parties will meet and confer in good faith to agree on either (i)
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Developer making the City Hall Payment, or (ii) if City desires for Developer to construct New
City Hall, a timely and expeditious process and timeline for Developer to submit and City to
process the MSDP and Master Tentative Map applications and City and Developer to establish
the Increased Construction Cost which City will be responsible to pay. If a pending Litigation
Challenge, referendum or initiative remains outstanding 48 months after the Effective Date,
Developer shall have no obligation to construct the New City Hall and may elect, at its sole
discretion, to make the City Hall Payment.
C) No Extension of Timeline Due to Permitted Delay that is not a Litigation
Challenge. For the avoidance of doubt, if, as a result of a Permitted Delay that is not a Litigation
Challenge (and not simply for Developer's convenience which is addressed by subsection 5.2.7a)
above), Developer submits the MSDP and Master Tentative Map applications more than 12
months and 18 months, respectively, after the Effective Date, then City's timeline obligations in
Sections 5.2.4 and 5.2.5 will not be extended unless otherwise agreed by Developer in its sole
discretion.
5.2.8 Construction Timeline. If Developer proceeds with construction of the
New City Hall under this Section 5.2, Developer shall complete core and shell construction and
deliver a Warm Shell New City Hall to City within thirty six (36) months after the date City has
obtained City Hall Approval and delivered the New City Hall site to Developer consistent with
Sections 5.2.4 and 5.2.5. Developer shall have no obligation to construct or install any tenant
improvements, off-site improvements, or other improvements that are not specified in the New
City Hall Criteria. Developer shall provide a one (1) year warranty for the Warm Shell work;
warranties and guaranties for other building components and systems, including roof and HVAC,
will be provided per industry standard.
5.2.9 Additional Costs. If the City's construction plans, specifications and
drawings for the New City Hall deviate from the New City Hall Criteria and such deviations
increase the cost to construct the New City Hall ("Design Deviations"), Developer shall pay the
cost of such Design Deviations not to exceed Four Million Dollars ($4,000,000) ("Deviation
Cost Allowance"). Any Design Deviations that increase New City Hall costs above the
Deviation Cost Allowance shall be the responsibility of the City. The Design Deviations do not
include any of the Excluded Items as defined in Exhibit G. If City desires Developer to construct
one or more of the Excluded Items, Developer may agree to do so in its sole discretion and City
shall bear the cost of any such work. If after meeting and conferring, the Parties are unable to
agree upon whether the New City Hall design is consistent with the New City Hall Criteria, the
Parties will pursue mediation as provided in Section 12.8 below. In addition to paying for
Design Deviations, the Deviation Cost Allowance may also be used to pay for the Increased
Construction Cost.
5.2. 10 City Election of City Hall Payment. At any time prior to Developer's
contracting with a general contractor or commencement of construction of the New City Hall,
City may provide notice to Developer that it will instead accept the City Hall Payment in lieu of,
and release Developer from, any obligation to construct the New City Hall. Developer shall give
City reasonable notice prior to entering into a contract with a general contractor.
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5.2.11 Construction Delay. Developer's construction contract with its general
contractor will provide for liquidated damages in the amount of $2,500 per day, payable to the
City, if for reasons other than Permitted Delay substantial completion of construction is delayed
beyond the date that is thirty six (36) months after the date City has obtained the City Hall
Approval and delivered the New City Hall site to Developer, provided such liquidated damages
will not be assessed to the extent the delays are the result of City requested change orders,
unreasonable delays by City in providing responses to requests for information or approvals, or a
default by City under the New City Hall agreement to be entered into by the Parties as provided
in Section 5.2.12 below. General Contractor delays in completion of the New City Hall will not
be a default under this Agreement; provided however Developer's failure to commence
construction of the New City Hall within the times provided or, following commencement
thereof, Developer's abandonment of the New City Hall shall, following notice and expiration of
applicable cure periods, constitute a default by Developer hereunder.
5.2.12 New City Hall Agreement. Concurrent with the processing of the MSDP
and Master Tentative Map applications, or at such later time as City and Developer may
mutually agree each in its discretion, City and Developer shall prepare a mutually acceptable
form of improvement agreement setting forth in greater detail their respective obligations with
respect to design, development and delivery of the New City Hall. The New City Hall
agreement shall address among other issues, the requirement to either use union labor or, if
required by Applicable Law, to comply with Prevailing Wage Laws, requirements for labor and
materials and performance bonds, completion guarantee, process for submittal and approval of
change orders, and warranty requirements. If the construction procurement needs to go through
the public contracting process under the Public Contract Code due to state mandate then the
Developer shall have no obligation to construct the New City Hall and may instead make the
New City Hall Payment.
5.3 Benefits to School Districts¶
5.3.1 FUHSD. Developer will enter into a separate agreement with the Fremont
Union High School District ("FUHSD") setting forth the following terms, or terms acceptable to
FUHSD: (a) if elected by FUHSD, Developer shall lease to FUHSD, for a term of thirty four
(34) years, at a rent of $1 per year on a NNN basis, a twenty five thousand (25,000) square foot
Warm Shell space for adult school and high school innovation center use ("Adult School and
Innovation Center"), together with parking stalls, which will be subject to project -wide shared
parking strategies of the Vallco Specific Plan and subject to reasonable relocation by Developer
from time to time depending on leasing or operational requirements; (b) Developer shall provide
warrantees and guarantees per the industry standard; (c) all tenant improvements will the
responsibility of the FUHSD; (d) Developer will consult in good faith with FUHSD to identify a
mutually acceptable location for the FUHSD premises and parking, provided the final decision as
to location of the leased premises will be at Developer's reasonable discretion and shall be
identified in Developer's MSDP; (e) Developer will obtain a Warm Shell occupancy permit and
deliver the space to FUHSD on the earlier of (i) the issuance of the certificate of occupancy for
the last residential building, or (ii) its construction per the Project's natural progression (i.e., at
the time of certificate of occupancy for the building in which the leased space is agreed to be
located); (f) FUHSD, as tenant, will participate in the Project master association and fair share
cost contribution for typical common area maintenance in the Project component in which the
Adult School and Innovation Center is located; and (g) provide for FUHSD to elect at its sole
discretion, in lieu of the leased space, to receive a one-time payment of Nine Million Five
Hundred Thousand Dollars ($9,500,000), including the terms on which Developer shall make the
payment; provided, however, in no event shall the payment be made later than issuance of the
last residential building certificate of occupancy. If Developer and FUHSD are unable to reach
agreement on the construction of the Adult School and Innovation Center after good faith efforts,
Developer shall have the option of making the payment described above. Developer's
obligations under this Section 5.3.1 are in addition to Developer's obligation to pay Other
Agency Fees imposed by FUHSD.
5.3.2 Payment to CUSD. Developer will enter into a separate agreement with
the Cupertino Unified School District ("CUSD") setting forth the following terms, or terms
acceptable to CUSD: Developer will make a one-time payment to CUSD in the total amount of
Fourteen Million Two Hundred Fifty Thousand Dollars ($14,250,000) (subject to reduction as
provided in Section 9.3.4) as directed by CUSD but in any event by no later than issuance of the
last residential building certificate of occupancy. Developer's obligations under this Section
5.3.2 are in addition to Developer's obligation to pay Other Agency Fees imposed by CUSD.
5.3.3 Co-Working/Incubator Space. Developer will use good faith efforts to
provide approximately forty thousand (40,000) square feet in co -working (e.g., NeueHouse,
Bespoke, HanaHaus, WeWork, Nextspace, Regus, etc.) or incubator space, in one or more
locations, as determined by Developer. Such space, at Developer's election, may be counted
against the minimum retail use requirement under the Vallco Specific Plan, provided that the
credit shall not exceed 40,000 sq. ft. of the total retail use requirement.
5.4 Transportation and Transportation Demand Management (TDM) Program¶
5.4.1 TDM. Developer shall fund and fully implement the TDM Program as
required by the Vallco FEIR MMRP incorporated herein by this reference. The further
particulars of the TDM program and its ongoing implementation shall be set forth in a recordable
TDM Agreement the form of which shall be prepared and mutually agreed upon by the Parties
no later than issuance of the first certificate of occupancy for any building. The TDM
Agreement shall be recorded against each parcel no later than issuance of the first building
permit for vertical construction within that parcel. The term of the TDM Agreement shall
continue as required in the Vested Approvals.
5.4.2 Mobility/Bike Hub. Developer shall include in the Project a mobility
hub , which may include a transit stop, community shuttle stop, a help station, bike hub and/or
cafe ("Mobility Hub"). Developer and City shall cooperate to establish a location, design and
program for the Mobility Hub that is reasonably acceptable to the Parties. The size and capacity
of Mobility Hub will vary depending on anticipated demand and location context, but shall be at
least 1,000 sq. ft. Uses may include a concierge station, bike hub staffed for bicycle -related
services including secured bike storage, peak -hour staff availability, folding bike or scooter
rentals, same-day repairs, bike and associated equipment sales and bike -related classes and/or a
bike share pod operated by Bay Area Bike Share, and bike racks in the public space, reserved
loading area for drop off/pick up of car shares or autonomous vehicles, and a cafe as part of a
retail program to serve a cyclist meeting . The Mobility Hub shall be located generally near
FSI
planned transit as approved in the MSDP. Designated car share parking spaces included as part
of the Mobility Hub, if any, may be reduced from the retail parking supply at Developer's
election as allowed in the Specific Plan.
5.4.3 Community Shuttle. Developer will operate and fund up to a total cost of
One Million Dollars ($1,000,000) a one year pilot program for a community shuttle with the goal
of connecting the two Cupertino high schools and Vallco, as well as an express to Mountain
View Caltrain; the final route shall be based on feasibility and cost to be jointly determined by
Developer and City. ("Pilot Community Shuttle"). The Pilot Community Shuttle shall
commence prior to issuance of the certificate of occupancy on the final office building within the
Project. If the Pilot Community Shuttle is successful and the City elects to establish and operate
an on-going shuttle program ("Permanent Community Shuttle"), Developer and its successors
shall make an annual contribution to the City toward the establishment and annual cost of
operating the Permanent Community Shuttle, in an amount not to exceed Seven Hundred Fifty
Thousand Dollars ($750,000) ("Annual Shuttle Contribution"). If the City establishes the
Permanent Community Shuttle, Developer shall pay the Annual Shuttle Contribution for a period
of nine (9) years, unless the City earlier ceases operation of the Permanent Community Shuttle,
at which point Developer shall have no further obligation to pay the Annual Shuttle
Contribution. Developer has right to prepay the balance of any remaining Annual Shuttle
Contribution at any time. The obligations for the Community Shuttle may be suspended due to
an event of Permitted Delay. Developer's obligations under this Section 5.4.3 shall survive the
expiration or earlier termination of this Agreement.
5.4.4 Transportation Infrastructure Contribution. Developer shall contribute
Eleven Million Dollars ($11,000,000) (subject to reduction as provided in Section 9.3.4)
("Transportation Contribution") to the City to be used for the study, design and construction
of two critical transportation infrastructure projects in the City (i) improvements to the I-
280/Wolfe Road interchange and (ii) the potential future bicycle and pedestrian trail along I-280
immediately to the north of the Project, and commonly known as the Junipero Serra Trail
(collectively, the "Transportation Infrastructure Projects"). Payments shall be made when
the Vested Approvals, MSDP and Master Tentative Map are Final.
5.5 Housing_Plan¶ Developer will comply with the Housing Plan, attached hereto as
Exhibit D, with respect to Affordable Housing and Market Rate Units. The City recognizes that
the construction of 534 BMR Units (based on full -build out) goes beyond the requirements of the
City's below market rate housing ordinance and significantly contributes towards reducing the
City's housing shortage and the City achieving its Regional Housing Needs Allocation
obligations.
ARTICLE 6
ANNUAL REVIEW
6.1 Annual Review¶
6. 1.1 Purpose. As required by California Government Code section 65865.1
and Municipal Code section 19.144.060(H), City and Developer shall review this Agreement and
all actions taken pursuant to the terms of this Agreement with respect to the development of the
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Project every twelve (12) months to determine good faith compliance with this Agreement.
Specifically, City's annual review shall be conducted for the purposes of determining
compliance by Developer with its obligations under this Agreement. Each annual review shall
also document: (a) the status of the Project development, and (b) any extension of the Initial
Term of this Agreement pursuant to Section 2.2.1.
6.1.2 Conduct of Annual Review. The annual review shall be conducted as
provided in this Section 6.1.2. By December 1 st of each year, Developer shall provide
documentation of its good faith substantial compliance with this Agreement during the previous
calendar year, including a completed Annual Review Form in the form provided in Exhibit E and
such other information as may reasonably be requested by the City Manager. If the City
Manager finds good faith compliance by Developer with the terms of this Agreement, Developer
shall be notified in writing and the review for that period shall be concluded. If the City
Manager is not satisfied that Developer is performing in accordance with the terms and
conditions of this Agreement, the City Manager shall prepare a written report specifying why the
Developer may not be in good faith compliance with this Agreement, refer the matter to the City
Council, and notify Developer in writing at least fifteen (15) business days in advance of the
time at which the matter will be considered by the City Council. This notice shall include the
time and place of the City Council's public hearing to evaluate good faith compliance with this
Agreement, a copy of the City Manager's report and recommendations, if any, and any other
information reasonably necessary to inform Developer of the nature of the proceeding. The City
Council shall conduct a public hearing at which Developer must submit evidence that it has
complied in good faith with the terms and conditions of this Agreement. Developer shall be
given an opportunity to be heard at the hearing. The findings of the City Council on whether
Developer has complied in good faith with this Agreement for the period under review shall be
based upon substantial evidence in the record. If the City Council determines, based upon
substantial evidence, that Developer has complied in good faith with the terms and conditions of
this Agreement, the review for that period shall be concluded. If the City Council determines,
based upon substantial evidence in the record, that Developer has not complied in good faith
with the terms and conditions of this Agreement, or there are significant questions as to whether
Developer has substantially complied in good faith with the terms and conditions of this
Agreement, the City Council, at its option, may continue the hearing and may notify Developer
of the City's intent to meet and confer with Developer within thirty (30) days of such
determination, prior to taking further action. Following such meeting, the City Council shall
resume the hearing in order to further consider the matter and to make a determination regarding
Developer's good faith compliance with the terms and conditions of this Agreement. In the
event City determines Developer is not in good faith compliance with the terms and conditions
of this Agreement, City may give the Developer a written Notice of Breach, in which case the
provisions of Section 12. 1, below, shall apply.
6.1.3 Failure to Conduct Annual Review. Failure of City to conduct an annual
review shall not constitute a waiver by the City of its rights to otherwise enforce the provisions
of this Agreement nor shall Developer have or assert any defense to such enforcement by reason
of any such failure to conduct an annual review.
6.1.4 Certificate of Compliance. If, at the conclusion of the annual review
described in Section 6.1.2, the Developer is found to be in good faith compliance with this
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Agreement, City shall, upon request by Developer, issue a Certificate of Compliance
("Certificate") to Developer stating that after the most recent annual review and based upon the
information actually known to an appropriate official of City specified in such Certificate that:
(a) this Agreement remains in effect, and (b) the Developer is not in Default. The Certificate
shall be in a recordable form, shall contain information necessary to communicate constructive
record notice of the finding of compliance, and shall state the anticipated date of commencement
of the next annual review. Developer may record the Certificate at its sole cost and expense,
without cost or expense to City.
ARTICLE 7
COOPERATION AND IMPLEMENTATION
7.1 Subsequent Approvals ¶ No legislative ordinances or other legislative approvals
are required for development of the Project. Certain other subsequent land use approvals,
entitlements, and permits other than the Vested Approvals, will be necessary or desirable for
implementation of the Project ("Subsequent Approvals"). The Subsequent Approvals include,
without limitation, the following: a Master Site Development Permit for the entirety of the
Property and Project ("MSDP"), other development permits as set forth in the Specific Plan, a
Master Tentative Map for the entirety of the Project and Property, Architectural and Site Review
("ASR"), demolition and grading permits, make-ready utility permits, excavation permits,
building permits, sewer and water connection permits, certificates of occupancy, additional
subdivision tentative and final maps and/or parcel maps, and improvement plans and public
improvement agreements, and may include lot line adjustments or lot mergers, encroachment
permits, tree removal permits, easements, air rights and other related agreements, and any
amendments to, or repealing of, any of the foregoing. Except as otherwise expressly provided
herein, the City shall not impose requirements or conditions upon the development and
construction of the Project that are inconsistent with the Vested Approvals, including the terms
and conditions of this Agreement, and Subsequent Approvals as obtained from time to time.
7.2 Scope of Review of Subsequent Approvals¶ City, in approving the Vested
Approvals and vesting the Project through this Agreement, is limiting its future discretion with
respect to the Project and Subsequent Approvals, to determining whether the application for a
Subsequent Approval is consistent with and meets the criteria set forth in the Vested Approvals,
and where applicable, other Project Approvals previously granted.
Subject to the foregoing, City reserves discretion to impose appropriate Exactions in
connection with issuance of Subsequent Approvals, as necessary to bring the Subsequent
Approval into compliance with Applicable Law and Vested Approvals, and provided that in
exercising its discretion in connection with consideration of Subsequent Approvals, City agrees
that City shall not revisit the policy decisions reflected by the Vested Approvals, and other
Project Approvals, and the vested rights provided under this Agreement, or impose any
Exactions that would conflict with Applicable Law or the Project Approvals unless expressly
permitted herein or in the Project Approvals. City has made a fundamental and final policy
decision by approving the Vested Approvals that the Tier 2 development program described in
the Vallco Specific Plan, as supported by the public and community benefits reflected in this
Agreement, is in the best interests of the public health, safety and general welfare, and City shall
not use its discretionary authority in considering any application for a Subsequent Approval to
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change the legislative or policy decisions reflected by the Vested Approvals, including, without
limitation, to reduce the density, permitted uses, number of residential units, square footage of
office development or other Tier 2 development program elements, or otherwise to change or
prevent the construction, operation, or maintenance of the Project as contemplated by the Vested
Approvals.
Subject to the foregoing, Exactions imposed on Subsequent Approvals may include
dedications of land for public uses and requirements that Developer construct or cause the
construction of ancillary public rights-of-way and internal streets, utilities, and public facilities,
including all applicable in -tract subdivision improvements. At such time as any Subsequent
Approval applicable to the Property is approved by City, then such Subsequent Approval shall
become subject to all the terms and conditions of this Agreement applicable to Project Approvals
and shall be automatically vested and treated as a "Project Approval" under this Agreement.
7.3 Processing Applications for Subsequent Approvals¶
7.3.1 Timely Submittals by Developer. Developer acknowledges that City
cannot begin processing applications for Subsequent Approvals until Developer submits
substantially complete applications. Developer shall submit an application for the MSDP with
respect to the entirety of the Property and Project in accordance with the requirements of the
Specific Plan and pay all applicable Processing Fees and any and other fees and deposits therefor
within twelve (12) months of the Effective Date and shall submit an application for the Master
Tentative Map and pay all applicable Processing Fees and any and other fees and deposits
therefor within eighteen (18) months of the Effective Date. The MSDP application shall contain,
among other information, information necessary to address the elements identified in Section 7.3
of the Specific Plan. The times for submittal of the MSDP and Master Tentative Map
applications will be extended an additional. six (6) months if Developer has made substantial
progress towards completing, and is in good faith discussions with the City regarding, the
applications, including having designed the Project in a manner that complies with the Vested
Approvals. Failure to strictly adhere to the timelines in this Section 7.3.1 shall not be a
terminable default under this Agreement; provided, however, a failure by Developer to make a
good faith effort to prepare and submit applications may, following notice and expiration of
applicable cure periods, constitute a Default hereunder. After approval of a MSDP and Master
Tentative Map for the Project or portion of the Property, Developer will submit applications for
Subsequent Approvals such as for an ASR, landscaping details, use permits (where required),
tree removal, encroachments, and all other required Subsequent Approvals. Developer may
process an ASR for a portion or all of the Property concurrently with its MSDP and Master
Tentative Map applications. In order to meet the MSDP and Master Tentative Map schedules
and timely process all Subsequent Approvals, Developer shall use good faith efforts to (a)
provide to City in a timely manner any and all documents, applications, plans, and other
information necessary for City to carry out its obligations hereunder; and (b) cause Developer's
planners, engineers, and all other consultants to provide to City in a timely manner all such
documents, applications, plans and other materials required under Applicable Law. It is the
express intent of Developer and City to cooperate and to diligently and expeditiously work to
obtain any and all Subsequent Approvals. Developer may seek and obtain Subsequent
Approvals for and construct and install Project Neutral Work independent of and either before or
after obtaining a MSDP and Master Tentative Map.
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7.3.2 Timely Processing by City. Upon submission by Developer of applicable
applications, Processing Fees and any and all other fees and deposits for any pending Subsequent
Approval, City shall, to the full extent allowed by Applicable Law, promptly, diligently and
expeditiously, subject to City ordinances, policies and procedures regarding hiring and
contracting, commence and complete all steps necessary to act on Developer's currently pending
Subsequent Approval applications including: (a) providing, at Developer's request and expense
and subject to Developer's request and prior approval, reasonable overtime staff assistance,
additional staff and/or staff consultants for concurrent, expedited planning and processing of
each pending Subsequent Approval application; (b) if legally required, providing notice and
holding public hearings; and (c) acting on any such pending Subsequent Approval application.
Upon submittal of an MDSP or ASR application, City and Developer shall meet and confer and
agree on an expeditious schedule, giving priority to Project applications. The Parties will agree
upon a processing schedule within 30 days of submittal of an MDSP, Master Tentative Map, or
ASR application, and both Parties shall use good faith efforts to meet all schedule deadlines.
Schedule modification shall be mutually agreed to, which shall not be unreasonably withheld,
conditioned or delayed. Absent the need for additional CEQA review, consistent with Section
7.3.3, City has committed to taking such actions as are reasonably necessary to process the
MSDP and Master Tentative Map within 180 days of receipt of a complete application and an
ASR within 120 days of a complete application. The MSDP shall be considered by the City
Council as set forth in the Specific Plan. To the greatest extent permitted by the Vested
Approvals or Applicable Law, Subsequent Approvals after approval of the MDSP will be
processed administratively by City staff. Developer's obligation to pay for the processing of
Subsequent Approvals, including staff time, materials and third -party consultants, shall be based
on the City's actual out-of-pocket costs, plus a 15% markup of consultant costs, per existing
policy, to cover City's costs of managing such third -party consultants and administering their
contracts. In processing Subsequent Approvals, City shall consider existing tenants that wish to
remain on site for the duration of their existing leases
7.3.3 CEQA. In connection with its consideration and approval of the Vallco
Specific Plan, and the other Vested Approvals for the Project, the City prepared and certified the
Vallco FEIR, which evaluated the environmental effects of the Vested Approvals for the Project,
and has imposed mitigation measures to reduce the significant environmental effects therefrom.
The Parties acknowledge that certain Subsequent Approvals may legally require additional
analysis under CEQA. Nothing contained in this Agreement is intended to prevent or limit the
City from complying with CEQA. In acting on Subsequent Approvals, City will rely on the
Vallco FEIR to the fullest extent permissible by CEQA as determined by City in its reasonable
discretion. In the event supplemental or additional review is required for a Subsequent Project
Approval, City shall limit such supplemental or additional review to the scope of analysis
mandated by CEQA and shall not impose new mitigation measures except as legally required, all
as determined by the City as the lead agency under CEQA in its reasonable discretion.
7.4 Other Agency Subsequent Approvals; Authority of Cit vlf City shall cooperate
with Developer, to the extent appropriate and as permitted by Applicable Law, in Developer's
efforts to obtain, as may be required, Other Agency Subsequent Approvals.
7.5 Consents¶ Whenever a determination, approval, consent or satisfaction
("Consent") is required of a Party pursuant to this Agreement, such Consent shall not be
34
unreasonably withheld or delayed. If a Party does not Consent, the reasons therefor shall be
stated in reasonable detail in writing. Consent by a Party to or of any act or request by the other
Party shall not be deemed to waive or render unnecessary Consent to or of similar or subsequent
acts or requests
7.6 Subdivision¶
7.6.1 Generally. The Project will be subdivided into various Project parcels,
including common area parcels, building parcels, common facility parcels, including vertical
subdivisions of certain components and other building components that would be described on
subdivision maps and/or subsequent future condominium plans. Within the timeframes set out in
Section 7.3.1, Developer shall submit an application for a Master Tentative Map for the entirety
of the Property and Project. At its election, Developer may submit multiple additional tentative
maps or final maps for each phase or other portions of the Property.
7.6.2 Condominiums. Developer may elect to establish some of these separate
building or block parcels as nixed use condominium components, as follows:
a) Developer shall have the right to establish residential buildings or,
alternatively, residential components within buildings as condominium projects, provided that
individual condominium units make up no more than 50% of all residential units.
b) Developer shall have discretion as to whether and when to market and sell
any such individual market rate residential units and when or whether to make application to
obtain a public report from the California Department of Real Estate for the future sales of any
such units.
7.6.3 Common Areas. Common areas, which may also be established as
separate common area parcels or as common easement parcels, such as commonly used parking
garages, including the proposed underground garage, and other shared commonly used amenities
and facilities, such as At Grade or above grade open space, plazas, sidewalks and walkways,
surface parking, signage, common landscaping, such as parkways and medians, common
security, common area trash collection, driveways, storm water facilities and other common use
amenities or easement areas, including areas adjacent to building parcels, will be established on
subdivision maps and easement documents. These common areas or common easement areas
will be owned, operated, maintained, repaired and replaced by a master property owners'
association and/or by separate owners or renters association(s) as established under the
provisions of a master declaration of covenants, conditions and restrictions for the Project
("CC&Rs"). The CC&Rs will provide a centralized and cohesive system of restrictions and
standards for management, operation and use of the Project as a mixed use center under the
control of the master center association in conformance with this Agreement and the Project
Approvals and for the maintenance, repair and replacement of common areas and common
facilities. Provisions of CC&Rs addressing maintenance, repair and replacement of publicly
accessible common areas, including parks, plazas, and open space, including remedies for failure
to comply with such provisions and City's third party beneficiary enforcement rights and
remedies thereunder, shall be subject to the City Attorney's review and approval not to be
unreasonably withheld.
M
7.6.4 Permitted Subdivision. Subdivision is pennitted throughout the Property
and Project to (i) accommodate development phasing, including for building parcels or blocks,
and associated landscaping, open space, common facilities, streets and parking; (ii)
accommodate financing; (iii) promote a mix of rental and ownership residential options; and (iv)
facilitate the development of subsidized affordable housing and senior housing, including in the
Office/Mixed-Use District. Up to one parcel per block and west of Wolfe Road one parcel per
building (regardless of land use) is permitted, provided that the following land uses may be
further divided into separate parcels in Developer's sole discretion as follows:
a) Retail: One parcel per building west of Wolfe Road or block east of Wolfe
Road, provided that up to five of such retail parcels can be further subdivided to create additional
retail ownership units, and provided further that the Property includes a maximum number of
retail parcels equal to or less than the number of retail blocks or buildings, as applicable, plus
five.
b) Residential:
(i) Senior Housing: Senior Housing that meets the definition in Civil
Code sections 51.2 and 51.3 may be divided into a single parcel, notwithstanding other
residential uses on the street block.
(ii) Subsidized Affordable Housing: Subsidized affordable housing
may be divided into a single parcel, notwithstanding other residential uses on the street block.
(iii) Individual Condominium Units: Parcelization to create individual
market and moderate rate residential condominium units, including potentially Senior Housing
units, subject to the limitations of Section 7.6.2(a) above.
C) Hotel: Each individual hotel may be a separate parcel.
d) Civic/Cultural: PAC, Adult School and Innovation Center, or other civic
uses may be separate parcels.
parcel:
uses; and
e) Common Areas: Common areas set forth below may be on a separate
(i) Streets
(ii) Open space
(iii) Common area landscaping associated with individual buildings or
(iv) Parking lots and/or garage facilities, above-, at-, or below -grade.
7.7 Existing, Continuing Uses and Interim Uses¶ The Parties acknowledge that the
existing uses on the Property as of the Effective Date are lawfully authorized uses and may
continue until modified in accordance with Applicable Law or replaced by the Project, provided
IR
that any modification thereof shall not be considered a component of the Project and shall not
extend the term of existing leases or other rights of occupancy. Developer may install interim or
temporary uses on the Property, consistent with the Vested Approvals.
ARTICLE 8
AMENDMENT OF AGREEMENT AND PROJECT APPROVALS
8.1 Amendment by Written Consent¶ Except as otherwise expressly provided herein
(including Section 6.1 relating to City's annual review and Section 12.3 relating to termination in
the event of a breach), this Agreement may be terminated, modified or amended only by mutual
written consent of the Parties hereto or their successors in interest or assignees and in accordance
with the provisions of Government Code sections 65967, 65867.5 and 65868.
8.2 Project Approval Amendments¶ To the extent permitted by Applicable Law,
Project Approvals may, from time to time, be amended in the following manner:
8.2.1 Administrative Project Amendments. Upon Developer's written request
for an amendment or modification to the Project Approvals, the City Manager shall determine:
(i) whether the requested amendment or modification is minor when considered in light of the
Project as a whole; and (ii) whether the requested amendment or modification is consistent with
this Agreement and Applicable Law. If the City Manager or his/her designee finds, in his or her
sole discretion, that the proposed amendment or modification is minor, consistent with this
Agreement and Applicable Law, and will result in no new significant impacts not addressed and
mitigated in the EIR, the amendment or modification shall be determined to be an
"Administrative Project Amendment" and shall not require an amendment to this Agreement.
Upon the City Manager's written approval, an Administrative Project Amendment shall be
automatically incorporated into the applicable Project Approvals and this Agreement. Without
limiting the foregoing, and by way of example, after City approval of the MSDP and Master
Tentative Map and other applicable Subsequent Approvals, Developer requests for adjustments
to lot lines or other minor changes to subdivision maps or improvement plans, minor changes in
land uses involving minimal acreage, minor alterations in vehicle circulation patterns or vehicle
access points, minor changes in the amount of parking and parking layout, changes in pathway
alignments, substitutions of comparable landscaping for any landscaping shown on any final
development plan or landscape plan, variations in the location of structures that do not
substantially alter the infrastructure connections or facilities that do not substantially alter the
design concepts of the Project, and minor adjustments to the Site Map or Property Description
may be treated as Administrative Project Amendments.
8.2.2 Major Project Amendments. Any amendment to the Project Approvals
which is determined not to be an Administrative Project Amendment as set forth above in
Section 8.2.1 shall be deemed a "Major Project Amendment". A Major Project Amendment,
shall be processed in the same manner and require the same approvals as the original Project
Approval, including, where so required, giving of notice and a public hearing before the
Planning Commission and City Council in accordance with the Applicable Law. The City
Manager or his or her designee shall have the authority to determine if an amendment is a Major
Project Amendment subject to this Section 8.2.2 or an Administrative Project Amendment
subject to Section 8.2.1 above.
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8.3 Amendment of this Agreement¶ This Agreement may be amended from time to
time, in whole or in part, by mutual written consent of the parties or their successors in interest,
as follows:
8.3.1 Administrative Agreement Amendments. Any amendment to this
Agreement which does not substantially affect (a) the Term; (b) permitted uses of the Property;
(c) provisions for the reservation or dedication of land; (d) conditions, terms restrictions or
requirements for Subsequent Approvals; (e) increases in the density or intensity of the use of the
Property or the maximum height or size of proposed buildings; (f) monetary contributions by
Developer; or (g) the provision of the public benefits described in Article 5, shall be deemed an
"Administrative Agreement Amendment" and the City Manager or his or her designee, except
to the extent otherwise required by Applicable Law, may approve the Administrative Agreement
Amendment without notice and public hearing.
8.3.2 Major Agreement Amendments. Any amendment to this Agreement
which is determined not to be an Administrative Agreement Amendment as set forth above in
Section 8.3.1 shall be deemed a "Major Agreement Amendment" and shall require giving of
notice and a public hearing before the Planning Commission and City Council in accordance
with Applicable Law. The City Manager or his or her designee shall have the authority, in his or
her sole discretion, to determine if an amendment is a Major Agreement Amendment subject to
this Section 8.3.2 or an Administrative Agreement Amendment subject to Section 8.3.1 above.
8.3.3 Requirement for Writing. No modification, amendment or other change to
this Agreement or any provision hereof shall be effective for any purpose unless specifically set
forth in a writing which refers expressly to this Agreement and is signed by duly authorized
representatives of both Parties or their successors in interest. A copy of any change shall be
provided to the City Council within thirty (30) days of its execution.
8.4 Amendments to Development Agreement Statute¶ This Agreement has been
entered into in reliance upon the provisions of the Development Agreement Statute as those
provisions existed as of the date of execution of this Agreement. No amendment or addition to
those provisions which would materially affect the interpretation or enforceability of this
Agreement shall be applicable to this Agreement, unless such amendment or addition is
specifically required by the California State Legislature, or is mandated by a court of competent
jurisdiction. If such amendment or change is permissive (as opposed to mandatory), this
Agreement shall not be affected by same unless the Parties mutually agree in writing to amend
this Agreement to permit such applicability.
ARTICLE 9
INSURANCE, INDEMNITY AND COOPERATION IN THE EVENT OF LEGAL
CHALLENGE
9.1 Insurance Requirements¶ Prior to commencement of construction activities and
through completion of all construction activities (including demolition) for the Project,
Developer shall procure and maintain, or cause its contractor(s) to procure and maintain, a
commercial general liability policy in an amount not less than two million ($2,000,000)
combined single limit, including contractual liability together with a comprehensive automobile
liability policy in the amount of one million ($1,000,000), combined single limit. Such policy or
policies shall be written on an occurrence form, so long as such form of policy is then commonly
available in the commercial insurance marketplace. Developer's insurance shall be placed with
insurers with a current A.M. Best's rating of no less than A -:VII or a rating otherwise approved
by the City in its sole discretion. Developer shall Rumish at City's request appropriate
certificate(s) of insurance evidencing the insurance coverage required hereunder, and City Parties
shall be named as additional insured parties in such policies. The certificate of insurance shall
contain a statement of obligation on the part of the carrier to notify City of any.material change,
cancellation or termination of the coverage at least thirty (30) days in advance of the effective
date of any such material change, cancellation or termination (ten (10) days advance notice in the
case of cancellation for nonpayment of premiums) where the insurance carrier provides such
notice to the Developer. Coverage provided hereunder by Developer shall be primary insurance
and shall not be contributing with any insurance, self-insurance or joint self-insurance
maintained by City, and the policy shall contain such an endorsement. The insurance policy or
the endorsement shall contain a waiver of subrogation for the benefit of City.
9.2 Indemnity and Hold Harmless¶ Developer shall indemnify, defend (with counsel
reasonably acceptable to City) and hold harmless City Parties from and against any and all
present and future Claims, including Claims for any bodily injury, death, or property damage,
resulting directly or indirectly from the development or construction of the Project and, if
applicable, the New City Hall by or on behalf Developer, compliance with the terms of this
Agreement, including the construction and/or provision of public or community benefits, and/or
from any other acts or omissions of Developer under this Agreement, whether such acts or
omissions are by Developer or any of Developer's contractors, subcontractors, agents or
employees, except to the extent such Claims arise from the active negligence or willful
misconduct of any City Party. This Section 9.2 includes any and all present and future Claims
arising out of or in any way connected with Developer's or its contractors' obligations to comply
with any applicable State Labor Code requirements and implementing regulations of the
Department of Industrial Relations pertaining to "public works" (collectively, "Prevailing Wage
Laws"), including all claims that may be made by contractors, subcontractors or other third party
claimants pursuant to Labor Code sections 1726 and 1781. Developer's obligations under this
Section 9.2 shall survive the expiration or earlier termination of this Agreement.
9.3 Defense and Cooperation in the Event of a Litigation Challenge¶
9.3.1 Cooperation. City and Developer shall cooperate in the defense of any
court action or proceeding instituted by a third party or other governmental entity or official
challenging the validity of any provision of this Agreement, or the Project Approvals
("Litigation Challenge"), and the Parties shall keep each other informed of all developments
relating to such defense, subject only to confidentiality requirements that may prevent the
communication of such information. To the extent Developer desires to contest or defend such
Litigation Challenge, (a) Developer shall take the lead role defending such Litigation Challenge
and may, in its sole discretion, elect to be represented by the legal counsel of its choice, with the
costs of such representation, including Developer's administrative, legal and court costs, paid by
Developer; (b) City may, in its sole discretion, elect to be separately represented by the legal
counsel of its choice in any such action or proceeding with the costs of such representation,
including City's administrative, legal, and court costs and City Attorney oversight expenses, paid
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by City; and (c) Developer shall indemnify, defend, and hold harmless City Parties from and
against any damages, attorneys' fees or cost awards, including attorneys' fees awarded under
Code of Civil Procedure section 1021.5, assessed or awarded against City by way of judgment,
settlement, or stipulation. Any proposed settlement of a Litigation Challenge shall be subject to
Developer's and City's approval not to be unreasonably withheld, conditioned or delayed. If the
terms of the proposed settlement would constitute an amendment or modification of this
Agreement or any Project Approvals, the settlement shall not become effective unless such
amendment or modification is approved by Developer and City in accordance with Applicable
Law, and City reserves its full legislative discretion with respect to any such City approval. If
Developer opts not to contest or defend such Litigation Challenge, City shall have no obligation
to do so. Developer's obligations under this Section 9.3.1 shall survive the expiration or earlier
termination of this Agreement.
9.3.2 ProcessingSubsequent ubsequent Approvals. Unless prevented by law or court
order, City shall continue to process applications for Subsequent Approvals during the pendency
of any Litigation Challenge and until the Project Approval which is the subject of such Litigation
Challenge is Final in accordance with this Agreement.
9.3.3 Public Benefit Funds. During the pendency of any Litigation Challenge or
referendum or initiative, and until the Project Approval which is the subject of such Litigation
Challenge or referendum or initiative is Final, Developer may request that City not expend or
commit to third parties any portion of the public benefits funds described in Article 5. Upon
receipt of such request City shall sequester the portions of such public benefit funds, if any, not
previously committed, expended, or transferred to third party until such time as the Project
Approval which is the subject of such Litigation Challenge or referendum or initiative becomes
Final.
9.3.4 Effect of Litigation Challenge on Developer Obligations. If a Litigation
Challenge or referendum or initiative is brought with respect to the validity of the Vested
Approvals, then the dollar amount of the Transportation Infrastructure Contribution will be
reduced by fifty percent (50%), the dollar amount of the payment to CUSD shall be reduced to
Nine Million Five Hundred Thousand Dollars ($9,500,000), and the maximum time period for
the Annual Shuttle Contribution will be reduced to 4 years.
ARTICLE 10
ASSIGNMENT, TRANSFER AND NOTICE
10.1 General¶ Because of the necessity to coordinate development of the entirety of
the Property pursuant to the Project Approvals and plans for the Project, particularly with respect
to the provision of public benefits as provided in Article 5, certain restrictions on the right of
Developer to assign or transfer its interest under this Agreement with respect to the Property, or
any portion thereof, are necessary in order to assure the achievement of the goals, objectives and
public benefits of the Project and this Agreement. Developer agrees to and accepts the
restrictions set forth in this Article 10 as reasonable and as a material inducement to City to enter
into this Agreement.
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10.2 Notice of Assi ent¶ Developer shall provide the City with written notice of
any proposed transfer or assignment of Developer's rights or obligations hereunder (each, an
"Assignment") at least thirty (30) days prior to such Assignment and request City's consent to
such Assignment, as provided herein. Each such notice of proposed Assignment shall be
accompanied by evidence of the financial information set forth below, if applicable, and a
proposed form of Assignee's assumption of Developer's obligations hereunder in the form of
Exhibit F, which would be recorded in the Official Records of Santa Clara County concurrent
with the transfer. Developer shall pay the actual costs borne by City in connection with its
review of the proposed Assignment, including the costs incurred by the City Attorney's Office.
10.3 Assignment ProcessingT
(i) Prior to City approval of the MSDP and Master Tentative Map,
Developer shall not transfer, or assign all or any portion of its rights, interests or
obligations of this Agreement, other than to an Affiliated Party, without the prior
written approval of City, which may be granted or denied in City's sole and
absolute discretion.
(ii) Except for a permitted Assignment to an Affiliated Party, prior to
substantial completion of the New City Hall Warm Shell, or Developer's payment
of the City Hall Payment to City in accordance with Section 5.2 of this
Agreement, (i) Developer shall not transfer or assign all or any portion of its
rights, interests or obligations under the Agreement with respect to the New City
Hall, and (ii) except as otherwise provided in this subparagraph below, Developer
shall not transfer or assign its rights, interests or obligations under this Agreement
with respect to more than 50% of the gross acreage of the Property, without the
prior written approval of City, which may be granted or denied in City's sole and
absolute discretion. Notwithstanding the foregoing, if Developer desires to
transfer more than 50% of the gross acreage of the Property, Developer may
deliver to City the sum of Thirty Five Million Dollars ($35,000,000) which City
shall place in a construction escrow that will be subject to joint escrow
instructions reasonably acceptable to the Parties providing, among other things,
for (a) City's right to withdraw an amount equal to the City Hall Payment at any
time prior to Developer's entry into a construction contract with a general
contractor for construction of the New City Hall, and (b) once Developer enters
into such construction contract, the terms under which Developer will be entitled
to draw down funds in the escrow to pay labor and materials costs of constructing
the New City Hall. Upon full funding of the escrow and execution of mutually
acceptable joint escrow instructions, Developer shall be permitted to proceed with
transfer of more than 50% of the Property, subject to compliance with the terms
of subparagraph (iii) below.
(iii) After City approval of the MSDP and Master Tentative Map, and
subject to the limitations in Subsection 10.3(ii) above, Developer shall have the
right to transfer or assign its rights and obligations under this Agreement to any
person, partnership, joint venture, firm, company, corporation or other entity (any
of the foregoing, an "Assignee") subject to the written consent of City, which
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shall not be unreasonably withheld, delayed or conditioned so long as the
proposed Assignee, to the reasonable satisfaction of the City Manager has
experience acting as the developer of projects with similar size and complexity to
the portion of the Project being transferred and the Assignee has the financial
resources necessary to meet its obligations under the proposed Assignment. If the
City Manager does not provide consent, he or she shall state the reasons for the
decision, and the corrections to be made to obtain such consent.
(iv) If an Assignee is taking ownership of a single building pad or
single building condominium component only and no obligations to construct any
off -parcel public improvements or publicly accessible improvements other than
building pad frontage improvements are being assigned, then no City consent to
the Assignment shall be required.
10.4 Expedited Financial Capability Review¶ It shall be presumptively determined that
a proposed Assignee has the requisite financial resources under Section 10.3(iii) above, if the
proposed Assignee has Liquid Assets in an amount that is not less than one hundred twenty five
percent (125%) of the reasonably estimated cost to meet its obligations under the proposed
Assignment. For purposes of the foregoing "Liquid Assets" shall mean any of the following,
but only to the extent owned individually, free of security interests, liens, pledges, charges or any
other encumbrance: (a) cash; (b) certificates of deposit (with a maturity of two years or less)
issued by, or savings account with, any bank or other financial institution reasonably acceptable
to City Manager; (c) marketable securities listed on a national or international exchange, marked
to market; or (d) unfunded but contractually committed capital requirements of direct or indirect
investors in proposed Assignee.
10.5 Affiliated Part y¶ Notwithstanding any other limitations in this Article 10,
Developer may, upon provision of Notice and execution of an agreement documenting such
Assignment in accordance with Section 10.2, at any time, assign its rights and obligations under
this Agreement with respect to all or any portion of the Property without the consent of City to
any corporation, limited liability company, partnership or other entity which is controlling of,
controlled by, or under common control with Developer, and "control," for purposes of this
definition, means effective management and control of the other entity, subject only to major
events requiring the consent or approval of the other owners of such entity ("Affiliated Party").
10.6 Partial Assi nit¶ Subject to the limitations set forth in this Article 10, in the
event of a transfer of a portion of the Property, Developer shall have the right to assign its rights,
duties and obligations under this Agreement that are applicable to the transferred portion, and
retain all rights, duties and obligations applicable to the retained portions of the Property. Upon
Developer's request, City, at Developer's expense, shall cooperate with Developer and any
proposed Assignee to allocate rights, duties and obligations under this Agreement and the Project
Approvals between the assigned portion of the Property and the retained Property. Assignee
shall succeed to the rights, duties and obligations of Developer only with respect to the parcel or
parcels, or portion of the Property so purchased, transferred, ground.leased or assigned, and
Developer shall continue to be obligated under this Agreement with respect to any remaining
portions of the Property retained by Developer and not assigned.
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10.7 Release of Transferring�Developer¶ Notwithstanding any sale, transfer or
assigninent of all or a portion of the Property, Developer shall continue to be obligated under this
Agreement as to all or the portion of the Property so transferred unless it is a permitted
Assignment or City has consented to the Assignment as provided above. If the required City
consent is given or if no such consent is required, then Developer shall be released from any
further liability or obligation under this Agreement related to the transferred Property as
specified in the Assignment and Assumption Agreement, and the Assignee shall be deemed to be
the Developer under this Agreement with all rights and obligations related thereto, with respect
to such transferred Property, and City shall provide Developer a written instrument to such effect
in a form and substance reasonably satisfactory to Developer. Notwithstanding anything to the
contrary contained in this Agreement, if a Assignee Defaults under this Agreement, such Default
shall not constitute a Default by Developer (or any other Assignee) with respect to any other
portion of the Property hereunder and shall not entitle City to terminate or modify this
Agreement with respect to such other portion of the Property.
10.8 Assignment to Financial Institutions or Mortgage e¶ Notwithstanding any other
provision of this Agreement, Developer may assign all or any part of its rights and duties under
this Agreement to any financial institution or Mortgagee from which Developer has borrowed
funds for use in constructing the Project or otherwise developing the Property and neither such
Assignment nor the financing shall require consent from City. A conditional assignment or other
transfer by a financial institution or Mortgagee back to Developer as part of any financing
transaction shall not require the City's consent.
10.9 Successive Assignment¶ In the event there is more than one Assignment under
the provisions of this Article 10, the provisions of this Article 10 shall apply to each successive
Assignment and Assignee.
10.10 Rights of Developer¶ The provisions in this Article 10 shall not be deemed to
prohibit or otherwise restrict Developer from (i) granting easements or licenses or modifying
existing easements to facilitate development of the Property consistent with the Project
Approvals, (ii) encumbering the Property or any portion hereof or of the improvements thereon
by a Mortgage securing financing with respect to the Property or Project, (iii) granting a
leasehold interest in portions of the Property, (iv) entering into a joint venture agreement or
similar partnership agreement to fulfill its obligations under this Agreement, (v) transferring all
or a portion of the Property pursuant to a foreclosure, conveyance in lieu of foreclosure, or other
remedial action in connection with a Mortgage, or to any transferee from a Mortgagee or owner
of the Property upon foreclosure or after a conveyance in lieu of foreclosure, or (vi) transferring
title to individual market -rate residential condominium units and obtaining evidence of
termination of this Agreement with respect to any such transferred units, or (vii) transferring any
completed components of public plazas, parking and other project common areas, as well as
certain limited obligations that are appropriate to a master property owners' association, such as
on-going TDM and community shuttle.
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ARTICLE 11
MORTGAGEE PROTECTION
11.1 Mortgagee Protection¶ Neither entering into this Agreement nor a breach hereof
shall defeat, render invalid, diminish or impair the lien of any Mortgage made in good faith and
for value. Nothing in this Agreement shall prevent or limit Developer, at its sole discretion, from
granting one or more Mortgages encumbering all or a portion of Developer's interest in the
Property or portion thereof or improvement thereon as security for one or more loans or other
financing, but all of the terms and conditions contained in this Agreement shall be binding upon
and effective against and shall run to the benefit of Mortgagee who acquires title or possession to
the Property, or any portion thereof, by foreclosure, trustee's sale, deed in lieu of foreclosure or
otherwise.
11.2 Mortgagee Not Obligate d¶ No Mortgagee (including one who acquires title or
possession to the Property, or any portion thereof, by foreclosure, trustee's sale, deed in lieu of
foreclosure or otherwise) shall have any obligation to construct or complete construction of
improvements, or to guarantee such construction or completion; provided, however, that a
Mortgagee shall not be entitled to devote the Property to any use except in full compliance with
this Agreement and the other Project Approvals nor to construct any improvements thereon or
institute any uses other than those uses or improvements provided for or authorized by this
Agreement, or otherwise under the Project Approvals. Except as otherwise provided in this
Section 11.2, all of the terms and conditions contained in this Agreement and the other Project
Approvals, shall be binding upon and effective against and shall run to the benefit of any person
or entity, including any Mortgagee, who acquires title or possession to the Property, or any
portion thereof, or its transferee.
11.3 Notice of Default to Mortgagee. If City receives a notice from a Mortgagee
requesting a copy of any Notice of Default given Developer hereunder and specifying the
address for service thereof, then City agrees to deliver to such Mortgagee, concurrently with
service thereon to Developer, any Notice of Default given to Developer. Failure to so deliver
such Notice of Default will invalidate such Notice as to the Mortgagee. Each Mortgagee shall
have the right during the same period available to Developer to cure or remedy, or to commence
to cure or remedy, the event of Default claimed or the areas of noncompliance set forth in City's
Notice of Default. If a Mortgagee is required to obtain possession in order to cure any Default,
the time to cure shall be tolled so long as the Mortgagee is attempting to obtain possession,
including by appointment of a receiver or foreclosure, but in no event may this period exceed
120 days from the date the City delivers the Notice of Default to Developer.
11.4 No Supersedure¶ Nothing in this Article 11 shall be deemed to supersede or
release a Mortgagee or modify a Mortgagee's obligations under any subdivision or public
improvement agreement or other obligation incurred with respect to the Project outside this
Agreement, nor shall any provision of this Article 11 constitute an obligation of City to such
Mortgagee, except as to rights under Sections 10.8 and 11.1 and the notice requirements of
Section 11.3.
11.5 Mortgagee Requested Amendments. City agrees that it will expeditiously process
any request by Developer to amend this Agreement, at the expense of Developer, to meet the
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requirements of any lender or Mortgagee for the Project. The Parties further agree that any
amendment to the Mortgagee Protection provisions of this Agreement required to conform to
current industry practice, as detennined by City, would qualify as an Administrative Agreement
Amendment and may be processed in accordance with the provisions of Article 8 of this
Agreement.
ARTICLE 12
DEFAULT; REMEDIES; TERMINATION
12.1 Breach and Default. Subject to Section 2.2.3 (Tolling of Term), a Permitted
Delay in Section 13.4 or a mutual extension pursuant to Section 13.11, except as otherwise
provided by this Agreement, breach of, failure, or delay by either Party to perform any term or
condition of this Agreement shall constitute a "Default." In the event of any alleged Default of
any term, condition, or obligation of this Agreement, the Party alleging such Default shall give
the defaulting Party notice in writing specifying the nature of the alleged Default and the manner
in which the Default may be satisfactorily cured ("Notice of Breach"). The defaulting Party
shall cure the Default within thirty (30) days following receipt of the Notice of Breach, provided,
however, if the nature of the alleged Default is non -monetary and such that it cannot reasonably
be cured within such thirty (3 0) day period, then the commencement of the cure within such time
period, and the diligent prosecution to completion of the cure thereafter at the earliest practicable
date, shall be deemed to be a cure, provided that if the cure is not so diligently prosecuted to
completion, then no additional cure period shall be required to be provided. If the alleged failure
is cured within the time provided above, then no Default shall exist and the noticing Party shall
take no further action to exercise any remedies available hereunder. If the alleged failure is not
cured, then a Default shall exist under this Agreement and the non -defaulting Party may exercise
any of the remedies available under this Agreement.
12.2 No Cross -Default. Notwithstanding anything to the contrary in this Agreement, if
Developer has completed an Assignment, so that its interest in the Property has been divided
between the Developer and one or more Assignees, then any determination that a party is in
Default or any termination of this Agreement or portion thereof pursuant to Article 12 of this
Agreement shall be effective only to the Party to whom the determination is made and the
portions of the Property in which such Party has an interest.
12.3 Termination¶ In the event of a Default by a Party, the non -defaulting Party shall
have the right to terminate this Agreement upon giving notice of intent to terminate pursuant to
Government Code section 65868 and regulations of City implementing such section. Following
notice of intent to terminate, the matter shall be scheduled for consideration and review in the
manner set forth in Government Code section 65867 and City regulations implementing said
section. Following consideration of the evidence presented in said review before the City
Council, a Party alleging Default by the other Party may give written notice of termination of
this Agreement to the other Party. Termination of this Agreement shall be subject to the
provisions of Section 12.9 hereof.
12.4 Specific Performance for Violation of a Condition¶ If City issues a Project
Approval pursuant to this Agreement in reliance upon a specified condition being satisfied by
Developer in the future, and if Developer then fails to satisfy such condition, City shall be
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entitled to an award of specific perfonnance for the purpose of causing Developer to satisfy such
condition.
12.5 Legal Actions¶
12.5.1 Institution of Legal or Equitable Actions. In addition to any other rights or
remedies, a Party may institute legal or equitable action for mandamus, specific performance or
other injunctive or declaratory relief to cure, correct or remedy any Default, to enforce any
covenants or agreements herein, to enjoin any threatened or attempted violation thereof, or to
obtain any other remedies consistent with the purpose and terms of this Agreement. Any such
legal action shall be brought in the Superior Court for Santa Clara County, California, except for
actions that include claims in which the Federal District Court for the Northern District of the
State of California has original jurisdiction, in which case the Northern District of the State of
California shall be the proper venue.
12.5.2 Acceptance of Service of Process. In the event that any legal action is
commenced by Developer against City, service of process on City shall be made by personal
service upon the City Clerk of City or in such other manner as may be provided by law. In the
event that any legal action is commenced by City against Developer, service of process on
Developer shall be made by personal service upon Developer's General Counsel, Developer's
registered agent for service of process, or in such other manner as may be provided by law.
12.6 Rights and Remedies Are Cumulative¶ The rights and remedies of the Parties are
cumulative, and the exercise by a Party of one or more of such rights or remedies shall not
preclude the exercise by it, at the same or different times, of any other rights or remedies for the
same Default or any other Default by the other Party, except as otherwise expressly provided
herein.
12.7 No Damages. In no event shall a Party, or its boards, commissions, officers,
agents or employees, be liable in damages for any Default under this Agreement, it being
expressly understood and agreed that the sole legal remedy available to a Parry for a breach or
violation of this Agreement by the other Party shall be an action in mandamus, specific
performance or other injunctive or declaratory relief to enforce the provisions of this Agreement
by the other Party, or to terminate this Agreement. This limitation on damages shall not preclude
actions by a Party to enforce payments of monies or fees or the performance of obligations
requiring an obligation of money from the other Party under the terms of this Agreement
including, but not limited to, obligations to pay the City Hall Payment, the PAC In Lieu
Payment, or the SB 35 City Hall Payment, attorneys' fees and obligations to advance monies or
reimburse monies. In connection with the foregoing provisions, each Party acknowledges,
warrants and represents that it has been fully informed with respect to, and represented by
counsel of such Party's choice in connection with, the rights and remedies of such Party
hereunder and the waivers herein contained, and after such advice and consultation has presently
and actually intended, with full knowledge of such Party's rights and remedies otherwise
available at law or in equity, to waive and relinquish such rights and remedies to the extent
specified herein, and to rely to the extent herein specified solely on the remedies provided for
herein with respect to any breach of this Agreement by the other Party.
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12.8 Resolution of Dispute s¶ With regard to any dispute involving the Project, the
resolution of which is not provided for by this Agreement or Applicable Law, a Party shall, at the
request of another Party, meet with designated representatives of the requesting Party promptly
following its request. The parties to any such meetings shall attempt in good faith to resolve any
such disputes. In the event the Parties are unable to resolve the issue and reach an agreement
within thirty (30) days, either party may initiate non-binding mediation of the dispute by
submitting a request to the other Party. The Parties will select a mutually acceptable mediator
with knowledge and experience in project development and construction issues of the type at
issue, within fourteen (14) days, or if unable to agree on a mediator within said period, either
party may submit the matter to mediation at JAMS or other mediation service mutually
acceptable to the Parties in accordance with its then applicable rules and policies, with each party
being responsible for its own fees, costs and expenses of any mediation, including 50% of the
mediator's fees, costs and expenses The Parties will take all practicable steps to complete any
mediation within ninety (90) days. Nothing in this Section 12.8 shall in any way be interpreted
as requiring that Developer, City and/or City's designee reach agreement with regard to those
matters being addressed, nor shall the outcome of these meetings be binding in any way on City
or Developer unless expressly agreed to in writing by the parties to such meetings.
12.9 Surviving Provisions¶ In the event this Agreement is terminated, neither Party
shall have any further rights or obligations hereunder, except for those obligations of Developer
which by their terms survive expiration or termination hereof, including those obligations set
forth in Sections 2.2.4, 5.4.3, 9.2 and 9.3.1
ARTICLE 13
GENERAL PROVISIONS
13.1 Condemnation.
13. 1.1 Material Condemnation. As used herein, "Material Condemnation" means
a condemnation of all or a portion of the Property that will have the effect of materially impeding
or preventing development of the Project in accordance with this Agreement and the Project
Approvals. In the event of a Material Condemnation, Developer may (a) request the City to
amend this Agreement in accordance with the Development Agreement Statute and/or to amend
the Project Approvals or Applicable City Regulations, which amendment shall not be
unreasonably withheld; (b) decide, in its sole discretion, to challenge the condemnation; or (c)
request that City agree to terminate this Agreement by mutual agreement, which agreement shall
not be unreasonably withheld, by giving a written request for termination to the City. If the
condemnation is not a Material Condemnation, Developer shall have no right to request
termination of this Agreement pursuant to this Section 13.1. Nothing in this Agreement shall be
deemed, or deemed to be, any waiver or release by Developer of any compensation or damages
awarded pursuant to a Material Condemnation.
13.1.2 Infrastructure Condemnation. If Developer is required by the Project
Approvals to acquire from a third party an interest in property necessary for construction of
Project related infrastructure and is unable to do so despite commercially reasonable, good faith
efforts, City may attempt to negotiate a purchase with the property owner, or may use its power
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of eminent domain, in which case Developer will pay all costs, expenses and fees, including
attorney fees incurred by City in an eminent domain action.
13.2 Covenants Binding on Successors and Assigns and Run with Land¶ Except as
otherwise more specifically provided in this Agreement, this Agreement and all of its provisions,
rights, powers, standards, terms, covenants and obligations, shall be binding upon the Parties and
their respective successors (by merger, consolidation, or otherwise) and assigns, lessees, and all
other persons or entities acquiring the Property, or any interest therein, whether by operation of
law or in any manner whatsoever, and shall inure to the benefit of the Parties and their respective
successors and assigns, as provided in Government Code section 65868.5, and shall be
enforceable as equitable servitudes and constitute covenants running with the land pursuant to
applicable laws.
13.3 Notice¶ Any notice, demand or request which may be permitted, required or
desired to be given in connection herewith shall be given in writing and directed to the City and
Developer as follows:
If to the City: City Clerk
City of Cupertino
10300 Torre Avenue
Cupertino, CA 95014-3202
Telephone: (408)777-3200
with a copy to: City Attorney
City of Cupertino
10300 Torre Avenue
Cupertino, CA 95014-3202
Telephone: (408) 777-3200
And: City Manager
City of Cupertino
10300 Torre Avenue
Cupertino, CA 95014-3202
Telephone: (408) 777-3200
If to Developer: Vallco Property Owner, LLC
c/o Sand Hill Property Company
965 Page Mill Road
Palo Alto, CA 94304
Telephone: (650) 344-5000
Attention: Reed Moulds
with a copy to: Coblentz Patch Duffy & Bass
One Montgomery Street, Suite 3000
San Francisco, CA 94104
Telephone: (415)391-4800
Attention: Miles Irnwalle
in
Notices to be deemed effective if delivered by certified mail, return receipt requested, or
commercial courier, with delivery to be effective upon verification of receipt. Any Party may
change its respective address for notices by providing written notice of such change to the other
Parties.
13.4 Permitted Delays. Performance by either of the Parties of an obligation hereunder
shall be excused during any period of"Permitted Delay." Permitted Delay shall mean delay
beyond the reasonable control of a Party caused by (a) calamities, including without limitation
earthquakes, floods, and fire; (b) civil commotion; (c) riots or terrorist acts; (d) lockouts, strikes
or other forms of labor disputes; (e) shortages of labor, equipment, facilities, materials or
supplies; (f) failure of transportation or freight embargoes; (g) vandalism; (h) condemnation or
requisition; (i) Litigation Challenge, referendum or initiative; 0) orders of governmental, civil,
military or naval authority, including any development, water or sewer moratorium; (k) the
failure of any governmental agency, public utility or communication provider to issue a permit,
authorization consent or approval required for development, construction use or operation of the
Project or portion thereof within typical, standard or customary timeframes; (1) Severe Economic
Recession; or (k) unusually severe weather, but only to the extent that such weather or its effects
(including, without limitation, dry out time) result in delays that cumulatively exceed twenty (20)
days for any winter season. An extension of time for any such cause other than a Severe
Economic Recession shall be for the period of the Permitted Delay and shall commence to run
from the time of the commencement of the cause, if Notice by the Party claiming such extension
is sent to the other Party within thirty (30) days of the commencement of the cause. If Notice is
sent after such thirty (30) day period, then the extension shall commence to run no sooner than
thirty (30) days prior to the giving of such Notice. Severe Economic Recession shall commence
upon Developer's notification the City of the Severe Economic Recession (together with
appropriate backup evidence). The cumulative time period for any Permitted Delays by any
Party shall not exceed five years.
13.5 CounterpartsT 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.
13.6 Waivers¶ Notwithstanding any other provision in this Agreement, any failures or
delays by any Party in asserting any of its rights and remedies under this Agreement shall not
operate as a waiver of any such rights or remedies, or deprive any such Party of its right to
institute and maintain any actions or proceedings which it may deem necessary to protect, assert
or enforce any such rights or remedies. A Party may specifically and expressly waive in writing
any condition or breach of this Agreement by the other Party, but no such waiver shall constitute
a further or continuing waiver of any preceding or succeeding breach of the same or any other
provision. Consent by one Party to any act by the other Party shall not be deemed to imply
consent or waiver of the necessity of obtaining such consent for the same or similar acts in the
future.
13.7 Construction of Agreement¶ All Parties have been represented by counsel in the
preparation and negotiation of this Agreement, and this Agreement shall be construed according
to the fair meaning of its language. The rule of construction to the effect that ambiguities are to
be resolved against the drafting party shall not be employed in interpreting this Agreement.
CLQ
Unless the context clearly requires otherwise, (a) the plural and singular numbers shall each be
deemed to include the other; (b) the masculine, feminine, and neuter genders shall each be
deemed to include the others; (c) "shall," "will," or "agrees" are mandatory, and "may" is
permissive; (d) "or" is not exclusive; (e) "includes" and "including" are not limiting; and (f)
"days" means calendar days unless specifically provided otherwise.
13.8 Headings¶ Section headings in this Agreement are for convenience only and are
not intended to be used in interpreting or construing the terms, covenants, or conditions of this
Agreement.
13.9 Severabilityll If any term or provision of this Agreement, or the application of any
term or provision of this Agreement to a specific situation, is found to be invalid, or
unenforceable, in whole or in part for any reason, the remaining terms and provisions of this
Agreement shall continue in full force and effect unless an essential purpose of this Agreement
would be defeated by loss of the invalid or unenforceable provisions, in which case any Party
deprived of an essential benefit thereunder shall have the option to terminate this Agreement
from and after such determination by providing written notice thereof to the other Party.
13.10 Time is of the Essence¶ Time is of the essence of this Agreement. All references
to time in this Agreement shall refer to the time in effect in the State of California.
13.11 Extension of Time Limits¶ The time limits set forth in this Agreement maybe
extended by Permitted Delays or mutual consent in writing of the Parties in accordance with the
provisions of this Agreement.
13.12 Other Necessary Acts ¶ Each Party shall in good faith do all things as may
reasonably be necessary or appropriate to carry out this Agreement, and the Vested Approvals
and Subsequent Approvals, and to execute with acknowledgement or affidavit if required and
deliver to the other, file or submit all such further information, instruments and documents as
may be reasonably necessary to carry out the purposes and objective of the Vested Approvals,
Subsequent Approvals and this Agreement and to provide and secure to the other Party the full
and complete enjoyment of its rights and privileges of this Agreement.
13.13 Si atures¶ The individuals executing this Agreement represent and warrant that
they have the right, power, legal capacity, and authority to enter into and to execute this
Agreement on behalf of the respective legal entities of Developer and the City.
13.14 Entire Agreement. This Agreement (including all Recitals, exhibits attached
hereto, each of which is fully incorporated herein by reference), integrates all of the terms and
conditions mentioned herein or incidental hereto, and constitutes the entire understanding of the
Parties with respect to the subject matter hereof, and all prior or contemporaneous oral
agreements, understandings, representations and statements, and all prior written agreements,
understandings, representations, and statements are terminated and superseded by this
Agreement.
13.15 Estoppel Certificate¶ Developer or its lender may, at any time, and from time to
time, deliver written notice to the City requesting the City to certify in writing to Developer or
any Mortgagee (a) that this Agreement is in full force and effect; (b) that this Agreement has not
50
been amended or modified or, if so amended or modified, identifying the amendments or
modifications or terminated or the subject of termination; (c) that Developer is not in Default of
the performance of its obligations, or if in Default, to describe therein the nature and extent of
any such Defaults; (d) those obligations under this Agreement have been satisfied since the date
of the last annual review and those obligations under this Agreement that remain unsatisfied; and
(e) such other information or matters relating to this Agreement and/or the Project as may be
reasonably requested by Developer. Developer shall pay, within thirty (30) days following
receipt of City's invoice, the actual costs borne by City in connection with its review of the
proposed estoppel certificate, including the costs expended by the City Attorney's Office in
connection therewith. The City Manager shall be authorized to execute any certificate requested
by Developer hereunder. The fonn of estoppel certificate shall be in a form reasonably
acceptable to the City Attorney. The City Manager shall execute and return such certificate
within thirty (30) days following Developer's request therefor. Developer and City acknowledge
that a certificate hereunder may be relied upon by tenants, transferees, investors, partners, bond
counsel, underwriters, bond holders and Mortgagees. The request shall clearly indicate that
failure of the City to respond within the thirty -day period will lead to a second and final request.
Failure to respond to the second and final request within fifteen (15) days of receipt thereof shall
be deemed approval of the estoppel certificate.
13.16 Recordation of Termination¶ Upon completion of the Project or portion thereof
and Developer's payment of all or applicable portion of the Impact Fees under Article 4 and
Developer's completion of the requirements, obligations and payments under Article 5, or upon
any earlier termination of this Agreement upon the mutual written consent of the Parties or as
otherwise expressly provided herein, a written statement acknowledging Developer's satisfaction
of all (or if for a portion of the Project, as to the applicable portion) obligations under this
Agreement or such termination, in form and content reasonably satisfactory to the Parties, shall
be provided by City to be executed by the Parties and recorded by City or Developer in the
Official Records of Santa Clara County.
13.17 City AApprovals and Actions¶ Whenever a reference is made herein to an action or
approval to be undertaken by City, the City Manager or his or her designee is authorized to act
on behalf of City, unless specifically provided otherwise or the context requires otherwise.
13.18 Negation of Partnership¶ The Parties specifically acknowledge that the Project is
a private development, that no Party to this Agreement is acting as the agent of any other in any
respect hereunder, and that each Party is an independent contracting entity with respect to the
terms, covenants and conditions contained in this Agreement. None of the terms or provisions of
this Agreement shall be deemed to create a partnership between or among the Parties in the
businesses of Developer, the affairs of the City, or otherwise, or cause them to be considered
joint venturers or members of any joint enterprise.
13.19 No Third Party Beneficiaries¶ This Agreement is made and entered into for the
sole protection and benefit of the signatory Parties and their successors and assigns, including
Mortgagees. No other person shall have any right of action based upon any provision in this
Agreement.
51
13.20 Governing State Law¶ This Agreement shall be construed in accordance with the
laws of the State of California, without reference to its choice of law provisions.
13.21 Exhibits¶ The following exhibits are attached to this Agreement and are hereby
incorporated herein by this reference for all purposes as if set forth herein in full:
Exhibit A: Property Description
Exhibit B: Site Map
Exhibit C: Phasing Plan
Exhibit D: Housing Plan
Exhibit E: Annual Review Form
Exhibit F: Form of Assignment and Assumption Agreement
Exhibit G: New City Hall Criteria
If the recorder refuses to record any exhibit, the City Clerk may replace it with a single
sheet bearing the exhibit identification letter, stating the title of the exhibit, the reason it is not
being recorded, and that the original, certified by the City Clerk, is in the possession of the City
Clerk and will be reattached to the original when it is returned by the recorder to the City Clerk.
[SIGNATURES ON FOLLOWING PAGE]
52
IN WITNESS WHEREOF, the City and Developer have executed this Agreement as of
the Effective Date.
ATTEST:
LIN
Grace Schmidt, City Clerk
APPROVED AS TO FORM:
LIN
Rocio Fierro, Acting City Attorney
CITY:
CITY OF CUPERTINO, a municipal corporation
Amy Chan, Interim City Manager
[Signature must be notarized)
DEVELOPER:
VALLCO PROPERTY OWNER, LLC, a
Delaware limited liability company
By:
Name:
Its:
By:
Name:
Its:
53
[Signatures must be notarized[
ACKNOWLEDGMENTS
A notary public or other officer completing this
certificate verifies only the identity of the
individual who signed the document to which this
certificate is attached, and not the truthfulness,
accuracy, or validity of that document.
State of California )
ss
County of )
On , before
(Name of Notary)
notary public, personally appeared
who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are
subscribed to the within instrument and acknowledged to me that he/she/they executed the same
in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the
person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the
foregoing paragraph is true and correct.
WITNESS my hand and official seal.
(Notary Signature)
Acknowledgments
ACKNOWLEDGMENTS
A notary public or other officer completing this
certificate verifies only the identity of the
individual who signed the document to which this
certificate is attached, and not the truthfulness,
accuracy, or validity of that document.
State of California )
) ss
County of )
On , before me,
(Name of Notary)
notary public, personally appeared
who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are
subscribed to the within instrument and acknowledged to me that he/she/they executed the same
in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the
person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the
foregoing paragraph is true and correct.
WITNESS my hand and official seal.
(Notary Signature)
Acknowledgments
EXHIBIT A
PROPERTY DESCRIPTION
[See Next Page]
Exhibit A-1
Your Reference Chicago Title Company
EXHIBIT A
LEGAL DESCRIPTION
THE LAND REFERRED TO HEREIN BELOW IS SITUATED IN THE CITY OF CUPERTINO, IN THE COUNTY
OF SANTA CLARA, STATE OF CALIFORNIA, AND IS DESCRIBED AS FOLLOWS:
Parcel One:
Beginning at the intersection of the most Easterly line of Tract No. 2860, as shown on that certain Map recorded
in Book 138 of Maps Pages 22 and 23, Santa Clara County Records, with the general Northwesterly line of that
certain parcel of land described as Parcel One in that certain Deed recorded in Book 7898 of Oficial Records,
Page 248, Santa Clara County Records, said line being common to the general Southwesterly right of way of the
lands of the Stale of California; thence along said common general line S. 43 deg 49' 16" E., (S. 43 deg. 48'E.
per said Deed) 267.06 feet; thence S. 11 deg. 33' 10" E., 245.25 feet; thence along a tangent curve to the left,
having a radius of 400.02 feet (400.00 feet per said Deed), through a central angle of 31 deg 44' 37", an arc
length of 221.62 feet (221.61 feet per said Deed) thence S. 43 deg. 17' 47" E. 260.69 feel (S. 43 deg. 16' 31" E.
260.67 feet per said Deed); thence along a non -tangent curve (tangent curve per said Deed) having a radius of
147.01 feet (147.00 feet per said Deed, concave to the Southwest), whose center bears S. 46 deg. 40' 52" W.
through a central angle of 26 deg. 09' 48", an are length of 67.13 feet; thence along a non -tangent curve (tangent
curve per said Deed) to the right, having a radius of 147.01 feet (147.00 feet per said Deed), concave to the
Southwest, whose center bears S. 77 deg. 52' 52" W. through a central angle of 5 deg. 02' 12" an arc length of
12.92 feet; thence S. 12 deg. 04' 03" E., 13.54 feet; thence S. 1 deg. 22' 02" W. 41.84 feel, thence along a non -
tangent curve to the right, having a radius of 1368.73 feet, whose center bears S. 01 deg. 45' 46" W., through a
central angle of 05 deg. 21' 30" an arc length of 128.01 feet; thence S. 82 deg, 52' 44" W. 76.01 feet; thence N.
01 deg. 08'33" W. 53.51 feet, thence S. 88 deg. 51'27" W. 303.11 feet; thence N. 00 deg. 04' 30" W. 407.03 feet;
thence N. 83 deg. 47'30" W. 42.44 feet; thence 100 deg. 17'20" W. 463.59 feet to the point of Beginning.
And being designated as Adjusted Parcel 1-C(2) of the plat marked Exhibit A attached to that certain Lot Line
Adjustment recorded November 18, 2005 as Instrument No. 18684096 of Official Records.
Parcel Two:
The reciprocal and non-exclusive easements, rights, privileges of use, ingress and egress, parking and for utility
and other purposes created and granted as an appurtenance to said land, described in that certain Construction,
Operation and Reciprocal Easement Agreement between Vallco Fashion Park Venture, Sears, Roebuck and Co.
and Federated Department Stores, Inc., dated as of the 19th day of February 1975, Recorded the 7th day of
March, 1975 in Book 6309, Page 1, Official Records, Santa Clara County, as amended by (1) First Amendment to
Construction, Operation and Reciprocal Easement Agreement Dated as of the 1st day of August, 1975 Recorded
August 29, 1975 in Book B591 at Page 434 of said Official Records; (2) Second Amendment to and Restatement
of Construction, Operation and Reciprocal Easement Agreement between Vallco Fashion Park Venture,
Federated Department Stores, Inc., Sears Roebuck and Co., Inc., and J. C. Penney Properties, Inc., dated as to
the 1st day of December, 1975 Recorded September 14, 1976 Book C280 Official Records, Page 296 in said
Official Records as Amended by Third Amendment to Reciprocal Easement Agreement dated September 14,
1976, recorded June 24, 1977 as Instrument No. 5698586; (3) the unrecorded agreement dated as of the 19th
day of February 1975, between Vallca Fashion Park Venture and Sears, Roebuck and Co., the unrecorded
Agreement of the same date between Vallco Fashion Park Venture and Federated Department Stores, Inc. and
the unrecorded Agreement dated as of March 1, 1976 between Vallco Fashion Park Venture and J. C. Penney
Properties, Inc, and (4) the undated Agreement and Consent and Approval executed by Vallco Park, LTD., Vallco
Fashion Park Venture, Federated Department Stores, Inc. and Sears, Roebuck and Co. recorded in aforesaid
Official Records in Book B309, Page 241 as amended by a First Amendment and Consent and Approval dated
August 1, 1975, by and among the same parties Recorded in the aforesaid Official Records in Book B591, Page
434 as further amended by another Agreement and Consent and Approval dated as of December 1, 1975, by and
among Vallco Center, Inc., Vallco Park Ltd., Federated Department Stores, Inc., Sears, Roebuck and Co. and
J.C. Penney Properties, Inc., recorded September 14, 1976 Book C280 Official Records, Page 484, as amended
by Agreement and Consent and Approval dated September 14, 1976, recorded June 24, 1977 in Book C946
Page 001, and by an Agreement and Consent and Approval dated November 7, 1980, by and among Vallco
CLTA Preliminary Report Form (Modified 11117;06) Printed 121612017 4 13 PM by «User Initials»
IPrelm (DSI Rev 9113116) Pagu :s Order No., 98201070.982SK-KC
Exhibit A-2
Your Reference
EXHIBIT A
(Continued)
Chicago Title Company
Center, Inc., a California corporation, and Vallco Park, Ltd., a California limited partnership, recorded November
7, 1980 in Book F717 at Page 174, and as amended by (5) Fourth Amendment to Construction, Operation and
Reciprocal Easement Agreement between Vallco Fashion Park Venture, Federated Department Stores, Inc.,
Sears, Roebuck and Co. and J. C. Penney Properties, Inc. dated May 1, 1979, recorded October 15, 1980 in
Book F656 Official Records, Page 203, and as amended by (6) Fifth Amendment to Construction, Operation and
Reciprocal Easement Agreement between Vallco Fashion Park Venture, Federated Department Stores, Inc.,
Sears, Roebuck and Co., and J. C. Penney Properties, Inc., dated February 15, 1984 and recorded February 16,
1984 in Book 1310 of Official Records, Page 001, (7) as further amended by Sixth Amendment to Construction,
Operation and Reciprocal Easement Agreement between Vallco International Shopping Center, LLC, a California
limited liability company; Macy's Development Stores, Inc., an Ohio corporation; Sears, Roebuck and Company,
a New York corporation and J.C. Penney Properties, Inc.. a Delaware corporation, dated July 14, 2006 and
recorded August 25, 2006 as Instrument No. 19079269 of Official Records, (said Construction, Operation and
Reciprocal Easement Agreement, as amended, said Agreements as Amended and said Original Agreement and
Consent and Approval, as amended are hereinafter referred to collectively as "Construction, Operation and
Reciprocal Easement Agreement", In, on, over, upon and under certain adjoining real property therein, more
particularly described, together with all of the rights, powers and privileges and benefits under said Construction,
Operation and Reciprocal Easement Agreement, accruing to Vallco Fashion Park Venture, Vallco Park, Ltd., and
Vallco Center, Inc., their successors, legal representatives and assigns.
Excepting therefrom said rights, powers, privileges and benefits which are not real property or interest in real
property.
Parcel Three:
The perpetual and exclusive easement to construct, to maintain in place, and to maintain, repair, replace,
reconstruct and use a vehicular tunnel and appurtenances not in excess of seventy (70) feet in width to be
constructed within the area more particularly described as follows:
Beginning at the monument at the intersection of the centerline of Wolfe Road and Vallco Parkway, as shown on
that certain Parcel Map, recorded in Book 325 at page 12, Santa Clara County Records; thence along the
westerly prolongation of the centerline of Vallco Parkway as shown on said Parcel map, S 88°54'46" W. 94,00
feet; thence leaving said prolongation along a line parallel to and 94.00 feet westerly of said centerline of Wolfe
Road, N 1°05'14" W. 924.22 feet to the True Point of Beginning; thence continuing along said parallel line N
1'05'14" W, 95.26 feet; thence along a tangent curve to the right whose radius is 100.00 feet, through a central
angle of 20'56'09", an arc length of 36.54 feet to a point of reverse curvature; thence along a tangent curve to the
left, whose radius is 100.00 feet, through a central angle of 18°28'53", an arc length of 32.26 feet; thence tangent
to said curve N 1'22'02" E, 71.50 feet to a point on the right-of-way line of the lands of the State of California;
thence leaving said right-of-way line N 88'54'46" E, 171.63 feet to a second point on said right-of-way line; thence
southerly along said right-of-way line S 15'06'31" W, 63.83 feet; thence leaving said right -o( --way line southerly
along a line parallel to and 76 feet easterly of the centerline of Wolfe Road as shown on said Parcel Map, S
1'05'14" E, 172.58 feet; thence at right angles S 88'54'46" W, 170.00 feet to the True Point of Beginning.
APN: 316-20.088
CI.TA Preliminary Report Form (Modified 11117106) Printed 1202017 4 13 PM by «User Initials»
IPrelm (DSI Rev 9113116) Page 4 Order No 98201070.982SK-KC
Exhibit A-3
Your Reference Chicago Tice Company
EXHIBIT A
LEGAL DESCRIPTION
THE LAND REFERRED TO HEREIN BELOW IS SITUATED IN THE CITY OF CUPERTINO, IN THE COUNTY
OF SANTA CLARA, STATE OF CALIFORNIA, AND IS DESCRIBED AS FOLLOWS:
Tract One:
Parcel 1-A(2):
That certain real property lying within Adjusted Parcel I -A per that certain Lot Line Adjustment for Vallco
International Shopping Center, LLC, recorded November 18, 2005 in Document No. 18684096 of Official
Records, Santa Clara County Records, being more particularly described as follows:
Commencing at the found Standard City Monument shown at the Northerly terminus of the course of the
monumentation line of Wolfe Road described as "North 1' 05' 14" West, 989.48 feel" per that certain Parcel Map
recorded in Book 325 of Maps at Page 112, Santa Clara County Records; Thence North 0' 04'37" East a distance
of 125.18 feet; Thence leaving said monument line at right angles thereto North 89' 55' 23" West a distance of
82.14 feet to the Northeast corner of Adjusted Parcel 1-C(1), as described in said Lot Line Adjustment; Thence
along the North boundary of said Parcel 1-C(1) along a curve to the right, having a radial bearing of North 01' 45'
45" East, a radius of 1368.73 feet, an arc length of 128.01 feel and a delta angle of 5' 21' 31 "; Thence continuing
along the North boundary of said Adjusted Parcel 1-C(1) the following courses and distances: North 82' 52' 44"
West, 76.01 feet; North 01' 08' 33" West, 44.47 feet; Thence along the North boundary of said Adjusted Parcel 1-
C(1), North 88' 54' 46" West a distance of 23.42 feet; Thence along a West boundary of said Adjusted Parcel 1-
C(1), South 01' 05' 14" East a distance of 353.92 feet to the Point of Beginning; Thence from said True Point of
Beginning along the West boundary of said Adjusted Parcel 1-C(1), South 01' 05' 14" East a distance of 24.08
feet; Thence continuing along the Westerly boundary of said Adjusted Parcel 1-C(1) the following courses and
distances: North 88" 54'46" East, 16.22 feet; South 46" 05' 14" East, 106.07 feet; South 01' 05' 14" East, 215.11
feet; South 88' 54'46" West, 29.29 feet; South 43" 54' 46" West, 150.58 feel; South 01' 05' 14" East, 29.43 feet;
South 88' 54' 46" West, 115.55 feet; North 01' 05' 14" West, 23.23 feet; South 88' 54' 46" West, 86.48 feet;
South 28' 54' 46" West, 95.50 feet; South 01' 05' 14" East, 83.48 feet; Thence continuing along the boundary of
said Adjusted Parcel 1-C(1), South 88' 54'46" West a distance of 299.55 feet to the East boundary line of Tract
No. 2086, recorded on September 30, 159 in Book 112 of Maps, Pages 40 and 41; Thence along the East
boundary of said Tract No. 2086, North 00' 42' 30" West a distance of 157.45 feet to the Southerly Right -of -Way
line of Amherst Drive shown on said Tract No. 2086; Thence along the South line of said Tract No. 2086, North
89' 13' 29" east a distance of 299.01 feel to the Southeast corner of said Amherst Drive, said South line also
being the Southerly Right -of -Way line of said Amherst Drive; Thence along the East line of said Tract No. 2086,
North 00" 04' 30" West a distance of 437.31 feel; Thence North 88' 54' 46" East, a distance of 286.10 feet to the
Point of Beginning.
And being designated as Parcel 1-A(2) of the plat marked Exhibit "A" attached to that certain Lot Line Adjustment
recorded April 02, 2008 as Instrument No. 19798059 of Official Records.
Parcel 1-C 1(2):
That certain real property lying within Adjusted Parcel 1-C(1) and Adjusted Parcel 1-A per that certain Lot Line
Adjustment for Vallco International Shopping Center, LLC, recorded November 18, 2005 in Document No.
18684096 of Official Records, Santa Clara County Records, being more particularly described as follows:
Commencing at the found Standard City Monument shown at the Northerly terminus of the course of the
monumentation line of Wolfe Road described as "North 1' 05' 14" West, 989.48 feet" per that certain parcel Map
recorded in Book 325 of Maps at Page 12, Santa Clara County Records; Thence North 0' 04' 37" East a distance
of 125.18 feet; Thence leaving said monument line at right angles thereto North 89' 55' 23" West a distance of
82.14 feet to the Northeast corner of Adjusted Parcel 1-C(1) as described in said Lot Line Adjustment, said point
also being the Point of Beginning; Thence from said True Point of Beginning along the North boundary of said
Parcel 1-C(1) along a curve to the right, having a radial bearing of North 01' 45' 45" east, a radius of 1368.73 feet,
CLTA Preliminary Report Form (Modified 11117106) Printed. 1218/20119:41 AM by -User Initials»
tPrelm (DSI Rev. 9/13116) Page 3 Order No98201069.982-SK-KC
Exhibit A-4
Your Reference:
EXHIBIT A
(Continued)
Chicago Title Company
an interior angle of 5" 21' 31", and a curve length of 128.01 feet; Thence continuing along the North boundary of
said Adjusted Parcel 1-C(1) the following courses and distances: North 82` 52'44" West, 76.01 feel; North 01' 08'
33" West, 53.51 feet; Thence along the North boundary of Adjusted Parcel 1-A described in said Lot Line
Adjustment, South 88° 51' 27" West a distance of 303.10 feet to the East boundary of Tract No. 2086 recorded on
September 30, 1959 in Book 112 of Maps, Pages 40 and 41; Thence along the East boundary of said Tract No.
2086, South 00' 04' 30" East a distance of 362.72 feet; Thence North 88' 54'46" East a distance of 286.10 feet to
the West boundary of said Adjusted Parcel 1-C(1); Thence continuing along the West boundary of said Adjusted
Parcel 1-C(1), South 01" 05' 14" East a distance of 24.08 feet; Thence continuing along the West boundary of
said Adjusted Parcel 1-0(1) the following courses and distances: North 88' 54' 46" East, 16.22 feet; South 46'
05' 14" East 106.07 feet; South 01" 05' 14" East, 215.11 feet; South 88' 54' 46" West, 29.29 feet; South 43' 54'
46" West, 150.58 feet; South 01"05'14" East 29.43 feet; South 88' 54' 46" West, 115.55 feet; North 01' 05' 14"
West, 23.23 feet; South 88' 54'46" West. 86.48 feet; South 28" 54' 46" West, 95.50 feet; South 01" 05' 14" East,
83.48 feet; Thence continuing along the boundary of said Adjusted Parcel 1-C(1), South 88' 54' 46" West a
distance of 299.55 to the East boundary line of said Tract No. 2086; Thence along the East boundary of said
Tract No, 2086, South 00' 42' 30" East a distance of 236.99 feet to the most Northwesterly comer of that certain
parcel described in Book 8073 Official Records at Page 372, Santa Clara County Records; Thence along the
Northerly line of said parcel, North 88" 54' 46" East a distance of 807.12 feet to the Westerly Right -of -Way of
Wolfe Road as shown on that certain Parcel Map recorded in Book 325 of Maps at Page 12, Santa Clara County
Records; Thence along the Westerly Right -of -Way of Wolfe Road, North 01' 05' 14" West a distance of 1019.49
feet; Thence continuing along the Westerly Right -of -Way of Wolfe Road, along a tangent curve to the right, having
a radius of 100.00 feet, an interior angle of 20' 56' 09" and an arc length of 36.54 feet to a point of reverse
curvature; Thence continuing along the Westerly Right -of -Way of Wolfe Road, along a reverse curve, having a
radius of 100.00 feet, an interior angle of 18" 28' 53" and an arc length of 32.26 feet; Thence continuing along the
Westerly Right -of -Way of Wolfe Road, North 01" 22'02" East a distance of 29.66 feet to the Point of Beginning.
Excepting from said Existing Adjusted Parcel 1-C(1) described above, a portion of said land as was conveyed to
the City of Cupertino by deed recorded October 15, 1976 as Instrument No. 5441905 in Book C348 Official
Records, Page 714.
And being designated as Parcel 1-C1(2) of the plat marked Exhibit "A" attached to that certain Lot Line
Adjustment recorded April 02, 2008 as Instrument No. 19798059 of Official Records.
Parcel II -B
A perpetual and exclusive easement, for the construction, maintenance in place and maintenance, repair,
replacement, re -construction and use of underground footings for buildings, structures and improvements to be
located in Parcel V-A hereinafter described and other land over, in, under, along and across the following
described real property:
All that air space bounded by planes projected vertically at the parcel limits, below the horizontal plane at
elevation 173.00 Feet, according to the datum of the City of Cupertino; (City of Cupertino Official Bench Mark BM -
1 Elev. 179.40);
Beginning at the intersection of the monument Line of Vallco Parkway as shown on that certain Parcel Map
recorded in Book 325 of Maps, Page 12, Santa Clara County Records, with the monument line of Wolfe Road as
shown on said Map; thence along said monument line of Wolfe Road, N. 1 deg 05' 14" W., 426.56 feel: thence N.
88 deg 54'46" E., 103.43 feet to the True Point of Beginning; thence N. 1 deg 05' 14" W., 140.00 feet; thence N.
88 deg 54' 46" E., 10.00 feet; thence S. 1 deg 05' 14" E. 140.00 feet; thence S. 88 deg 54' 46" W., 10.00 feet to
the True Point of Beginning.
Parcel V-A:
CLTA Preliminary Report Form (Modified 11/17/06) Printed. 1 2/81201 7 9 41 AM by -User Initials»
IPrelm (OSI Rev. 9/13/16) Page 4 Order No., 98201069.982SK-KC
Exhibit A-5
Your Reference.
EXHIBIT A
(Continued)
Chicago Title Company
A perpetual and exclusive easement granted by the City of Cupertino, California by Agreement dated October 8,
1974, recorded October 17, 1974 in Official Records, Santa Clara County, Book B 135 at Page 370, as amended
by Supplement to Agreement between the City of Cupertino, California and Vallco Park, Ltd., dated as of August
5, 1975, recorded on August 20, 1975 in the aforesaid Official Records in Book 8571 Page 724, to construct,
maintain in place, maintain, repair, replacement re -construct and to use buildings, structures and improvements
over the following described Parcel of Land.
All that certain real property situated in the City of Cupertino, County of Santa Clara, State of California, being a
140 foot wide strip, bounded by planes projected vertically at the Parcel limits, above the horizontal plane at
elevation 195.50 feet, according to the datum of the City of Cupertino; (City of Cupertino Official Bench Mark BM -
1 - Elev. 179.40) the centerline of which is described as follows:
Beginning at the monument at the centerline of Wolfe Road and Vallco Parkway, as shown on that certain Parcel
Map, recorded in Book 325 of Maps, Page 12, Santa Clara County Records; thence Northerly along the centerline
of Wolfe Road as shown on said Parcel Map N. 1 deg 05' 14" W., 496.56 feet; thence at right angles S. 88 deg 54'
46" W., 94.00 feet to the True Point of Beginning; thence N. 88 deg 54' 46" E., 170.00 feet; The Easterly terminus
being the Easterly Right -of -Way line of Wolfe Road and the Westerly terminus being the Westerly Right -of -Way
line of Wolfe Road.
Parcel V -B:
The perpetual and exclusive easement for the construction, maintenance in place, and maintenance, repair,
replacement, reconstruction and use of columns, supports, footings and foundations for buildings, structures and
Improvements to be located in Parcel V-A above described, granted by The City of Cupertino, California, by
Agreement dated October 8, 1974, recorded on October 17, 1974 in Official Records, Santa Clara County, Book
B135 at page 370, as amended by Supplement to Agreement between the City of Cupertino, California and Vallco
Park, Ltd., dated as of August 5, 1975, recorded on August 20, 1975 in the aforesaid Official Records in Book
B571 at Page 724, over, in, under, along and across the following described real property.
Beginning at the intersection of the monument line of Vallco Parkway as shown on that certain Parcel Map,
recorded in Book 325 of Maps, Page 12, Santa Clara County Records, with the monument line of Wolfe Road as
shown on said Map; thence leaving said monument line of Vallco Parkway along the Northerly projection of said
monument line of Wolfe Road, N. 1 deg 05'14" W., 426,56 feet to the True Point of Beginning; thence S. 88 deg
54' 46" W., 14.50 feet; thence N,1 deg 05' 14" W., 140.00 feet; thence N. 88 deg 54'46" E. 32.00 feet; thence S.
1 deg 05'14" E., 140.00 feet; thence S. 88 deg 54'46" W., 17.50 feet to the True Point of Beginning.
Parcel V -C:
The perpetual and exclusive easement for the construction, maintenance in place, and maintenance, repair,
replacement, re -construction and use of columns, supports, footings and foundations for buildings, structures and
improvements to be located in Parcel V-A above described, granted by the City of Cupertino, California by
Agreement dated October 8, 1974, recorded on October 17, 1974 in Official Records, Santa Clara County, Book
B135 at Page 370, as amended by Supplement to Agreement between the City of Cupertino, California and
Vallco Park, Ltd., dated as of August 5, 1975, recorded on August 20, 1975 in Book 8571 at Page 724, Official
Records, and as amended by Second Amendment to Agreement, dated March 1, 1976 and recorded September
14, 1976 in Book C280 at Page 236, Official Records, and as amended by Third Amendment to Agreement, dated
October 7, 1991 and recorded July 24, 1992 in Book M297 at Page 1860, Official Records, over, in, under along
and across the following described real property:
All that space bounded by planes projected vertically at the Parcel limits, below the horizontal plane at elevation
173.00 feet, according to the datum of the City of Cupertino; (City of Cupertino Official Bench Mark BM -1 = Elev.
179.40);
CLTA Preliminary Report Form (M(>dified 11/17/06) Printed1218/2017 9:41 AM by «User Indials-
IPrelm lost Rev. 9113/16) Page 5 Order No.: 98201069 -982,9K -KG
Exhibit A-6
Your Reference
EXHIBIT A
(Continued)
Chicago Title Company
Beginning at the intersection of the monument line of Vallco Parkway as shown on that certain Parcel Map,
recorded in Book 325 of Maps at Page 12, Santa Clara County Records, with the monument line of Wolfe Road
as shown on said Map; thence leaving said monument line of Vallco Parkway along the Northeasterly projection
of said monument line of Wolfe Road, N. 1 deg 05' 14" W., 426,56 feet; thence S. 88 deg 54'46" W., 84.00 feet to
the True Point of Beginning; thence continuing S. 88 deg 54' 46" W., 10.00 feet to the Westerly line of Wolfe
Road; thence along said line N. 1 deg 05' 14" W., 140.00 feet; thence leaving said Westerly line, N. 88 deg 54'
46" E., 10.00 feet; thence S. 1 deg 05' 14" E., 140.00 feet to the True Point of Beginning.
Parcel V -D
A perpetual and exclusive easement to construct, repair, replace, reconstruct and use a vehicular tunnel and
appurtenances thereto not in excess of 70 feet in width to be constructed, granted by the City of Cupertino,
California by Agreement dated October 8, 1974, recorded on October 17, 1974 in Official Records, Santa Clara
County, Book 8135 at Page 370, as Amended by Supplement to Agreement between the City of Cupertino,
California, and Vallco Park, Ltd., dated as of August 6, 1975, recorded on August 20, 1975 in the aforesaid
Official Records in Book B571 at Page 724, within the area described as follows:
Beginning at the monument at the intersection of the centerline of Wolfe Road and Vallco Parkway, as shown on
that certain Parcel Map, recorded in Book 325 at Page 12, Santa Clara County Records; thence along the
Westerly prolongation of the centerline of Vallco Parkway as shown on said Parcel Map, S. 88 deg 54' 46" W.
94.00 feet; thence leaving said prolongation along a line parallel to and 94.00 feet Westerly of said centerline of
Wolfe Road, N. 1 deg 05'14" W., 924.22 feet to the True Point of Beginning; thence continuing along said parallel
line N. 1 deg 05' 14" W., 95.26 feel; thence along a tangent curve to the right whose radius of 100.00 feet;
through a central angle of 20 deg 56'09", an arc length of 36.54 feet to a point of reverse curvature; thence along
a tangent curve to the left, whose radius is 100.00 feet, through a central angle of 18 deg 28' 53" an arc length of
32.26 feel; thence tangent to said curve; N. 1 deg 22' 02" E., 71.50 feel to a point on the Right -of -Way line or the
lands of the State of California; thence leaving said Right -of -Way line N. 88 deg 54'46" E. 171.63 feet to a second
point on said Right -of -Way line; thence Southerly along said Right -of -Way line S. 15 deg 06' 31" W., 63.83 feet;
thence leaving said Right -of -Way line Southerly along a line parallel to and 76 feet Easterly of the centerline of
Wolfe Road as shown on said Parcel Map, S. 1 deg 05' 14" E., 172.58 feel; thence at right angles S. 88 deg 54'
46" W., 170.00 feet to the True Point of Beginning_
Excepting therefrom that portion of Parcel V -D as was conveyed to the City of Cupertino by Deed recorded
October 15, 1976 in Book C348, Official Records, Page 714.
Also excepting therefrom that portion of Parcel V -D as was conveyed to the City of Cupertino by Deed recorded
October 15, 1976 in Book C348, Official Records, Page 723.
Parcel XI:
The reciprocal and non-exclusive easements, rights, privileges of use, ingress and egress, parking and for utility
and other purposes created and granted as an appurtenance to said land, described in that certain Construction,
Operation and Reciprocal Easement Agreement between Vallco Fashion Park Venture, Sears, Roebuck and Co.
and Federated Department Stores, Inc., dated as of the 19th day of February 1975, Recorded the 7th day of
March, 1975 in Book B309, Page 1, Official Records, Santa Clara County, as amended by (1) First Amendment to
Construction, Operation and Reciprocal Easement Agreement Dated as of the 1st day of August, 1975 Recorded
August 29, 1975 in Book 8591 at Page 434 of said Official Records; (2) Second Amendment to a Restatement of
Construction, Operation and Reciprocal Easement Agreement between Vallco Fashion Park Venture, Federated
Department Stores, Inc., Sears Roebuck and Co., Inc., and J. C. Penney Properties, Inc., dated as to the 1st day
of December, 1975 Recorded September 14, 1976 Book C280 Official Records, Page 296 in said Official Records
as Amended by Third Amendment to Reciprocal Easement Agreement Dated September 14, 1976, Recorded
June 24, 1977 File No. 5698586; (3) the unrecorded agreement dated as of the 19th day of February 1975,
between Vallco Fashion Park Venture and Sears, Roebuck and Co., the unrecorded Agreement of the same date
CLTA Preliminary Report Form (Modified 11117/06) Printed: 12/812017 9 41 AM by <<User Initials»
IPrelm (DS( Rev. 9113116) Page 6 Order No.: 98201069 -982 -SK -KC
Exhibit A-7
Your Reference
EXHIBIT A
(Continued)
Chicago Tillo Company
between Vallco Fashion Park Venture and Federated Department Stores, Inc. and the unrecorded Agreement
dated as of March 1, 1976 between Vallco Fashion Park Venture and J. C. Penney Properties, Inc. and (4) the
undated Agreement and Consent and Approval executed by Vallco Park, LTD., Vallco Fashion Park Venture,
Federated Department Stores, Inc. and Sears, Roebuck and Co. Recorded In aforesaid Official Records in Book
8309, Page 241 as amended by a First Amendment and Consent and Approval Dated August 1, 1975, by and
among the same parties Recorded in the aforesaid Official Records in Book B591, Page 445 as further amended
by another Agreement and Consent and Approval Dated as of December 1, 1975, by and among Vallco Center,
Inc., Vallco Park Ltd., Federated Department Stores, Inc., Sears, Roebuck and Co, and J.C. Penney Properties,
Inc., Recorded September 14, 1976 Book C280 Official Records, Page 484, as amended by Agreement and
Consent and Approval Dated September 14, 1976 Recorded June 24, 1977 in Book C946 Page 001 and as
amended by (5) Fourth Amendment to Construction, Operation and Reciprocal Easement Agreement between
Vallco Fashion Park Venture, Federated Department Stores, Inc., Sears, Roebuck and Co, and J. C. Penney
Properties, Inc. Dated May 1, 1979, Recorded October 15,1980 in Book F656 Official Records, Page 203, and as
amended by (6) Fifth Amendment to Construction, Operation and Reciprocal Easement Agreement between
Vallco Fashion Park Venture, Federated Department Stores, Inc., Sears, Roebuck and Co., and J. C. Penney
Properties, Inc., Dated February 15, 1984 and Recorded February 16, 1984 in Book 1310 of Official Records,
Page 001, (7) as further amended by Sixth Amendment to Construction, Operation and Reciprocal Easement
Agreement between Vallco International Shopping Center, LLC, a California limited liability company; Macy's
Development Stores, Inc., an Ohio corporation; Sears, Roebuck and Company, a New York corporation and J.C.
Penney Properties, Inc., a Delaware corporation, dated July 14, 2006 and recorded August 25, 2006 as
Instrument No. 19079269 of Official Records, (said Construction, Operation and Reciprocal Easement
Agreement, as amended, said Agreements as Amended and said Original Agreement and Consent and Approval,
as amended are hereinafter referred to collectively as "Construction, Operation and Reciprocal Easement
Agreement", in, on, over, upon and under certain adjoining real property therein, more particularly described,
together with all of the rights, powers and privileges and benefits under said Construction, Operation and
Reciprocal Easement Agreement, accruing to Vallco Fashion Park Venture, Vallco Park, Ltd., and Vallco Center,
Inc., their successors, legal representatives and assigns.
Excepting therefrom said rights, powers, privileges and benefits which are not real property or interest in real
property.
Also Excepting therefrom that portion Released by Release and Termination, Recorded January 9, 2017,
Instrument No. 23552485, of Official Records.
Parcel XVI:
An easement to construct, maintain, use and operate an automobile parking structure for automobile and other
vehicle parking, and rights of access, ingress and egress for automobiles and other vehicles and for pedestrians
and for utilities, landscaping and incidental uses, as reserved by Vallco Fashion Park Venture, a California
partnership in the "Amendment to Ground Sublease" recorded March 1, 1985 as Instrument No. 8340269, in
Book J283 at Page 149, on the following described land:
All that certain parcel of land, being a portion of Parcel IA of the sublease between Vallco Fashion Park Venture
and Federated Department Stores, Inc., Recorded March 7, 1975 in Book 8308 at Page 565 through 571, Santa
Clara County Records, Stale of California and more particularly described as follows:
Beginning at the Southeast corner of Tract 2086 as shown on that certain Map Recorded in Book 112 of Maps, at
Pages 40 and 41, Santa Clara County Records; (1) thence Northwesterly along the Easterly line of said Tract
North 0 deg. 43' West 742.60 feel to a point, said point being the southwest corner of the aforementioned Parcel
IA; (2) thence Northeasterly leaving said Easterly line of said Tract, along the Southerly boundary of the
aforementioned Parcel IA North 88 deg. 54' 46" East 69.00 feet to the True Point of Beginning; (3) thence
continuing along said Southerly line of Parcel IA South 88 deg. 54' 46" East 230.55 feet; (4) thence North 1 deg.
05' 14" West 83.48 feet; (5) thence North 28 deg. 54' 46" East 12.77 feet; (6) thence Southwesterly, leaving the
CLTA Preliminary Report Form (Modified 11117106) Printed: 12!812017 9 41 AM by «User Inihals»
IPrelm (DSI Rev. 911all 6) Page 7 Order No,: 98201069.982SK-KC
Exhibit A-8
Your Reference Chicago Title Company
EXHIBIT A
(Continued)
boundary line of the aforementioned Parcel IA, South 88 deg. 54' 46" West 263.31 feet; (7) thence South 0 deg.
42' 30" East 94.54 feet to the Point of Beginning.
Said easement shall terminate upon the termination of the Federated Department Stores lease and/or upon the
demolition and removal of the parking structure as therein provided.
Parcel XVIII:
Being a portion or Parcel 1 of that certain parcel Map recorded 325 of Maps at Page 12, Santa Clara County
Records being described as follows:
Beginning at the intersection of the monument line of Vallco Parkway as shown on said Parcel Map with the
monument line of Wolfe Road. Said point being the Westerly terminus of the course shown as "North 88" 54'46"
East, 854.00 feet" on said Parcel Map, said course being the basis of the bearings described hereon;
Thence along the monument line of said Wolfe Road North 01' 05' 23" West, 989.48 feet; Thence leaving said
centerline, at right angles therefrom North 88' 54' 37" East, 76.00 feet to a point on the Westerly line of Parcel VI
of lands granted to Vallco International Shopping Center LLC per that certain Grant Deed recorded in Document
No. 18331566 of Official Records, Santa Clara County Records, said point being the True Point of Beginning;
Thence along the Westerly line of Parcel VI, along a line lying 76.00 feet Easterly of and parallel with said
monument line of Wolfe Road, North 01' 0523" West, 107.17 feet to an angle point in said Westerly line; Thence
continuing along said westerly line North 15' 06' 31" East, 41.30 feet; Thence leaving said Westerly line, Easterly
along a non -tangent curve to the left, having a radius of 528.00 feel, through a central angle of 02" 15' 02" for an
arc distance of 20.74 feet, the radius point of which bears North 01" 49' 13" West; Thence North 86' 05'45" East,
119.28 feet; Thence North 88' 54' 46" East, 55.94 feet to a point on the general Easterly line of said Parcel VI per
said Grant Deed; Thence along said general Easterly line of Parcel VI South 01' 05' 14" East, 407.40 feet;
Thence continuing along said general Easterly line South 46' 05' 14" East, 75.68 feel; Thence continuing along
said general Easterly line North 88' 54' 46" East, 48.02 feet; Thence continuing along said general Easterly line
South 01' 05' 14" East, 347.65 feet; Thence continuing along said general Easterly line South 68' 54' 46" West,
65.00 feet; Thence continuing along said general Easterly line South 01' 05' 14" East, 46.19 feet to the Easterly
terminus of the most southerly line of said Parcel VI; Thence along said Southernmost line South 88' 54' 46"
West, 243.82 feet to a point lying 76.00 feet Easterly of and perpendicular to said monument line of Wolfe Road,
said point being the Southwesterly corner of said Parcel VI; Thence along a line lying 76.00 feel Easterly of and
parallel with said monument line, along the Westerly lines of said Parcel VI and Parcel II -A of said Grant Deed to
Vallco International Shopping Center LLC North 01' 05'23" West, 701.39 feet to the True Point or Beginning.
And being designated as Parcel One of the plat marked Exhibit "A" attached to that certain Lot Line Adjustment
recorded on August 22, 2006 as Instrument No. 19069106 of Official Records, and further identified as Lands of
Vallco International Shopping Center LLC New Parcel 1 in Exhibit "C" of said Lot Line Adjustment.
Tract Two:
Parcel One:
A portion of the Quito Rancho, and being a portion of the 39.39 acre tract of land described in the deed to Vallco
Park LTD., recorded October 19, 1967 in Book 7898, Page 248 of Official Records, Santa Clara County Records,
described as follows.
Commencing at the intersection of the Monument Line of Stevens Creek Boulevard, being 45 feet Southerly from
the Northerly line thereof with the center line of Wolfe Road, 108 feet wide; thence N. 1` 5' 14" W., along said
center line of Wolfe Road, 105.37 feet; thence S. 88' 54' 45'W., 54 feet to the Westerly line of Wolfe Road at the
Northerly terminus of a curve having a radius of 60 feet, and the actual point of beginning; thence N. 1' 5' 14" W.,
along the Westerly line of Wolfe Road, 819.02 feet; thence S. 88' 54' 40" W., 847.26 feet to an Easterly line of
CLTA Preliminary Report Form (Modified 11/17106) Printed: 12/8/2017 9'41 AM by «User Iniltals»
IPrelm (DSI Rev. 9113/16) Page 9 Order No., 98201069.982SK•KC
Exhibit A-9
Your Reference:
EXHIBIT A
(Continued)
Chicago Title Company
Tract No. 2086, Map filed in Book 112 of Maps, Pages 40; thence S. 0" 42' 55" E., along said Easterly line and its
Southerly prolongation 869.53 feet to the Northerly line of Stevens Creek Boulevard, being 45 feet Northerly of
the Monument Line thereof; thence N. 89° 36' E., along said Northerly line, 792.24 feel; thence along the arc of a
curve to the left having a radius of 60 feet; thence an angle of 90° 41' 14" an arc distance of 94.96 feet to the
actual point of beginning.
Parcel Two:
The reciprocal and non-exclusive easements, rights, privileges of use, ingress and egress, parking and for utility
and other purposes created and granted as an appurtenance to said land, described in that certain Construction,
Operation and Reciprocal Easement Agreement between Vallco Fashion Park Venture, Sears, Roebuck and Co,
and Federated Department Stores, Inc., dated as of the 19th day of February 1975, Recorded the 7th day of
March, 1975 in Book 8309, Page 1, Official Records, Santa Clara County, as amended by (1) First Amendment to
Construction, Operation and Reciprocal Easement Agreement Dated as of the 1st day of August, 1975 Recorded
August 29, 1975 in Book 8591 at Page 434 of said Official Records; (2) Second Amendment to a Restatement of
Construction, Operation and Reciprocal Easement Agreement between Vallco Fashion Park Venture, Federated
Department Stores, Inc., Sears Roebuck and Co., Inc., and J. C. Penney Properties, Inc., dated as to the 1st day
of December, 1975 Recorded September 14, 1976 Book C280 Official Records, Page 296 in said Official Records
as Amended by Third Amendment to Reciprocal Easement Agreement Dated September 14, 1976, Recorded
June 24, 1977 File No. 5698586; (3) the unrecorded agreement dated as of the 19th day of February 1975,
between Vallco Fashion Park Venture and Sears, Roebuck and Co., the unrecorded Agreement of the same date
between Vallco Fashion Park Venture and Federated Department Stores, Inc. and the unrecorded Agreement
dated as of March 1, 1976 between Vallco Fashion Park Venture and J. C. Penney Properties, Inc. and (4) the
undated Agreement and Consent and Approval executed by Vallco Park, LTD., Vallco Fashion Park Venture,
Federated Department Stores, Inc. and Sears, Roebuck and Co. Recorded in aforesaid Official Records in Book
8309, Page 241 as amended by a First Amendment and Consent and Approval Dated August 1, 1975, by and
among the same parties Recorded in the aforesaid Official Records in Book 8591, Page 445 as further amended
by another Agreement and Consent and Approval Dated as of December 1, 1975, by and among Vallco Center,
Inc., Vallco Park Ltd., Federated Department Stores, Inc., Sears, Roebuck and Co. and J.C. Penney Properties,
Inc., Recorded September 14, 1976 Book C280 Official Records, Page 484, as amended by Agreement and
Consent and Approval Dated September 14, 1976 Recorded June 24, 1977 in Book C946 Page 001 and as
amended by (5) Fourth Amendment to Construction, Operation and Reciprocal Easement Agreement between
Vallco Fashion Park Venture, Federated Department Stores, Inc., Sears, Roebuck and Co. and J. C. Penney
Properties, Inc. Dated May 1, 1979, Recorded October 15, 1980 in Book F656 Official Records, Page 203, and as
amended by (6) Fifth Amendment to Construction, Operation and Reciprocal Easement Agreement between
Vallco Fashion Park Venture, Federated Department Stores, Inc., Sears, Roebuck and Co., and J. C. Penney
Properties, Inc., Dated February 15, 1984 and Recorded February 16, 1984 in Book 1310 of Official Records,
Page 001, (7) as further amended by Sixth Amendment to Construction, Operation and Reciprocal Easement
Agreement between Vallco International Shopping Center, LLC, a California limited liability company; Macy's
Development Stores, Inc., an Ohio corporation; Sears, Roebuck and Company, a New York corporation and J.G.
Penney Properties, Inc., a Delaware corporation, dated July 14, 2006 and recorded August 25, 2006 as
Instrument No. 19079269 of Official Records, (said Construction, Operation and Reciprocal Easement
Agreement, as amended, said Agreements as Amended and said Original Agreement and Consent and Approval,
as amended are hereinafter referred to collectively as "Construction, Operation and Reciprocal Easement
Agreement", in, on, over, upon and under certain adjoining real property therein, more particularly described,
together with all of the rights, powers and privileges and benefits under said Construction, Operation and
Reciprocal Easement Agreement, accruing to Vallco Fashion Park Venture, Vallco Park, Ltd., and Vallco Center,
Inc., their successors, legal representatives and assigns.
Excepting therefrom said rights, powers, privileges and benefits which are not real property or interest in real
property.
CLTA Preliminary Report Foran (Modified 11117106) Printed 12/8/2017 9 41 AM by —User Initials»
IPrelm (DSI Rev, 9113116) Page 9 Order No.: 98201069.982SK-KC
Exhibit A-10
Your Reference Chicago Title Company
EXHIBIT A
(Continued)
Also Excepting therefrom that portion Released by Release and Termination Recorded January 9, 2017,
Instrument No. 23552485, of Official Records.
Tract Three:
Parcel One:
All that real property situate in the City of Cupertino, Stale of California, being a portion of Parcel 1 of that certain
Parcel Map recorded in Book 325 of Maps at Page 12, Santa Clara County Records, described as follows:
Beginning at a found 1" iron pipe monument marking the most Northerly corner of said Parcel 1, said point being
the most Northerly corner of Parcel VI of lands granted to Vallco International Shopping Center LLC per that
certain grant deed recorded in Document No. 18331566 of Official Records, Santa Clara Records;
Thence along the Northeasterly line of said Parcel 1 and said Parcel VI, South 60° 16' 27" East, 575.42 feel to the
Northeasterly corner of said Parcel VI per said grant deed;
Thence continuing along said Northeasterly line of Parcel 1 per said Parcel Map, South 60° 16' 27" East, 123.46
feet to the Northeasterly corner of said Parcel 1;
Thence along the Easterly line of said Parcel 1, South 01` 05' 14" East, 1049.61 feet to a point lying 55.00 feet
Northerly of and perpendicular to the monument fine of Vallco Parkway as said monument line is shown on said
Parcel Map;
Thence along a line lying 55.00 feet Northerly of and parallel with said monument line South 88° 54' 46" West,
46.72 feet to the True Point of Beginning;
Thence continuing along said line South 88° 54'46" West, 631.28 feet;
Thence along a tangent curve to the right, having a radius of 20.00 feet, through a central angle of 89° 59' 51" for
a distance of 31.42 feet to a point lying 76.00 feet Westerly of a perpendicular to the monument line of Wolfe
Road, as said monument line is shown on said Parcel Map;
Thence along a line lying 76.00 feet Easterly of and parallel with said monument line North 01° OF 23" West,
213.09 feet to the Southwesterly corner of said Parcel VI of said grant deed;
Thence along the most Southerly line of said Parcel VI North 88° 54' 46" East, 223.23 feet;
Thence leaving said Southernmost line South 01' 06' 14" East, 78.71 feet;
Thence North 88° 54'46" East, 428.06 feet;
Thence South 01 ° 05' 14" East, 154.38 feet to the True Point of Beginning.
The basis of described bearings is the monumented centerline of said Vallco Parkway, having a bearing of North
88° 54'46" East as shown on said Parcel Map.
And being designated as Parcel Two of the plat marked Exhibit "A" attached to that certain Lot Line Adjustment
recorded on August 22, 2006 as Instrument No. 19069106 of Official Records, and further identified as Lands of
JC Penney Properties Inc. New Parcel 2 in Exhibit "C" of said Lot Line Adjustment,
Parcel Two:
CLTA Preliminary Report Form (Modified 11117106) Primed 12/8/2017 9 4171 AM by -User Initials—
IPrelm (DSI Rev 9113116) Page IC Order No., 98201069-982SK•KC
Exhibit A-11
Your Reference. Chicago Title Company
EXHIBIT A
(Continued)
All that certain real property situate in the City of Cupertino, State of California, being a portion of Parcel 1 of that
certain Parcel Map recorded in Book 325 of Maps at Page 12, Santa Clara County Records, described as follows:
Beginning at the found 1" iron pipe monument marking the most Northerly corner of said Parcel 1, said point
being the most Northerly corner of Parcel VI of lands granted to Vallco International Shopping Center LLC per that
certain grant deed recorded in Document No. 18331566 of Official Records, Santa Clara County Records;
Thence along the Northeasterly line of said Parcel 1 per said Parcel Map, South 60° 16' 27" East, 123.46 feet to
the Northeasterly corner of said Parcel 1;
Thence along the Easterly line of said Parcel 1, South 01' 05' 14" East, 1049.61 feet to a point lying 55.00 feet
Northerly of and perpendicular to the monument line of Vallco Parkway as said monument line is shown on said
Parcel Map;
Thence along a line lying 55.00 feet Northerly of and parallel with said monument line South 88° 54' 46" West,
46.72 feet,
Thence North 01` 05' 14" West, 154.38 feel;
Thence South 88' 54' 46" West, 428.06 feel,
Thence North 01' 05' 14" West, 78.71 feet to a point on the most Southerly line of said Parcel VI per said grant
deed;
Thence along said Southernmost line North 88" 54'46" East, 20.59 feet to its Easterly terminus;
Thence Northerly along the general Easterly line of said Parcel VI North 01 " 05' 14" West, 46.19 feet;
Thence continuing along said general Easterly line North 88` 54'46" East, 65.00 feet;
Thence continuing along said general Easterly line North 01' 05' 14" West, 347.65 feet,
Thence continuing along said general Easterly line South 88` 54'46" West, 48.02 feet;
Thence continuing along said general Easterly line North 46' 05' 14" West, 75.68 feet;
Thence continuing along said general Easterly line North 01'05' 14" West, 432.68 feet;
Thence continuing along said general Easterly line North 88' 54' 46" East, 384.58 feet to the True Point of
Beginning.
The basis of described bearings is the monument line of said Vallco Parkway, having a bearing of North 88' 54'
46" East as shown on said Parcel Map.
And being designated as Parcel Three of the plat marked Exhibit "A" attached to that certain Lot Line Adjustment
recorded on August 22, 2006 as Instrument No. 19069106 of Official Records, and further identified ;1 s Lands of
JC Penney Properties Inc. New Parcel 3 in Exhibit "G" of said Lot Line Adjustment.
Parcel Three:
The reciprocal and non-exclusive easements, rights, privileges of use, ingress and egress, parking and for utility
and other purposes created and granted as an appurtenance to said land, described in that certain Construction,
Operation and Reciprocal Easement Agreement between Vallco Fashion Park Venture, Sears, Roebuck and Co.
CLTA Preliminary Report Form (Modified 11117;06) Printed 12/812017 9:41 AM by —User Initials»
IPrelm (DSI Rev 9113116) Page t I Order No 98201069-982SK-KC
Exhibit A-12
Your Reference
EXHIBIT A
(Continued)
Chicago Title Company
and Federated Department Stores, Inc., dated as of the 19th day of February 1975, Recorded the 7th day of
March, 1975 in Book B309, Page 1, Official Records, Santa Clara County, as amended by (1) First Amendment to
Construction, Operation and Reciprocal Easement Agreement Dated as of the 1st day of August, 1975 Recorded
August 29, 1975 in Book B591 at Page 434 of said Official Records; (2) Second Amendment to a Restatement of
Construction, Operation and Reciprocal Easement Agreement between Vallco Fashion Park Venture, Federated
Department Stores, Inc., Sears Roebuck and Co., Inc., and J. C. Penney Properties, Inc., dated as to the 1st day
of December, 1975 Recorded September 14, 1976 Book C280 Official Records, Page 296 in said Official Records
as Amended by Third Amendment to Reciprocal Easement Agreement Dated September 14, 1976, Recorded
June 24, 1977 File No. 5698586; (3) the unrecorded agreement dated as of the 19th day of February 1975,
between Vallco Fashion Park Venture and Sears, Roebuck and Co., the unrecorded Agreement of the same dale
between Vallco Fashion Park Venture and Federated Department Stores, Inc, and the unrecorded Agreement
dated as of March 1, 1976 between Vallco Fashion Park Venture and J. C. Penney Properties, Inc. and (4) the
undated Agreement and Consent and Approval executed by Vallco Park, LTD_, Vallco Fashion Park Venture,
Federated Department Stores, Inc. and Sears, Roebuck and Co. Recorded in aforesaid Official Records in Book
8309, Page 241 as amended by a First Amendment and Consent and Approval Dated August 1, 1975, by and
among the same parties Recorded in the aforesaid Official Records in Book 8591, Page 445 as further amended
by another Agreement and Consent and Approval Dated as of December 1, 1975, by and among Vallco Center,
Inc., Vallco Park Ltd., Federated Department Stores, Inc., Sears, Roebuck and Co. and J.C. Penney Properties,
Inc., Recorded September 14, 1976 Book C280 Official Records, Page 484, as amended by Agreement and
Consent and Approval Dated September 14, 1976 Recorded June 24, 1977 in Book C946 Page 001 and as
amended by (5) Fourth Amendment to Construction, Operation and Reciprocal Easement Agreement between
Vallco Fashion Park Venture, Federated Department Stores, Inc., Sears, Roebuck and Co. and J. C. Penney
Properties, Inc. Dated May 1, 1979, Recorded October 15, 1980 in Book F656 Official Records, Page 203, and as
amended by (6) Fifth Amendment to Construction, Operation and Reciprocal Easement Agreement between
Vallco Fashion Park Venture, Federated Department Stores, Inc., Sears, Roebuck and Co., and J. C. Penney
Properties, Inc., Dated February 15, 1984 and Recorded February 16, 1984 in Book 1310 of Official Records,
Page 001, (7) as further amended by Sixth Amendment to Construction, Operation and Reciprocal Easement
Agreement between Vallco International Shopping Center, LLC, a California limited liability company; Macy's
Development Stores, Inc., an Ohio corporation; Sears, Roebuck and Company, a New York corporation and J.C.
Penney Properties, Inc., a Delaware corporation, dated July 14, 2006 and recorded August 25, 2006 as
Instrument No. 19079269 of Official Records, (said Construction, Operation and Reciprocal Easement
Agreement, as amended, said Agreements as Amended and said Original Agreement and Consent and Approval,
as amended are hereinafter referred to collectively as "Construction, Operation and Reciprocal Easement
Agreement", in, on, over, upon and under certain adjoining real property therein, more particularly described,
together with all of the rights, powers and privileges and benefits under said Construction, Operation and
Reciprocal Easement Agreement, accruing to Vallco Fashion Park Venture, Vallco Park, Ltd., and Vallco Center,
Inc., their successors, legal representatives and assigns.
Excepting therefrom said rights, powers, privileges and benefits which are not real properly or interest in real
property.
Also Excepting Therefrom that portion Released by Release and Termination Recorded January 9, 2017,
Instrument No. 23552485, of Official Records.
CLTA Preliminary Report Form (Modified 11117/06)
)Prelm (DSI Rev 9/13116) Pago 12
Exhibit A-13
Printed 12!8/2017 9 41 AM by -User Initials»
Order No.: 98201069.982SK•KC
EXHIBIT B
SITE MAP
Exhibit B-1
EXHIBIT C
PHASING PLAN
I. Phase 1. At a minimum, the first phase of the Project shall either be, at the election of the
Developer, in its sole discretion, Phase I or 1B, as each is described below. Developer may
proceed with both Phases I and 1B at the same time.
a. Phase IA. Retail and Entertainment District, Excluding Sears (the "Retail
District/Phase 1")
i. Retail District/Phase 1 shall not include the portion of the Property
including the existing Sears department store building.
ii. The Town Square and multi -use pathway and related landscaping shall be
completed within 12 months from issuance of the last certificate of occupancy for use of a
building in the Retail District/Phase 1, provided that public access and use will be subject to
public safety and construction logistics considerations.
iii. All other public open space, street and common area landscaping
improvements in the Retail District/Phase 1 shall be completed within 12 months from issuance
of the last certificate of occupancy for use of a building in the Retail District/Phase 1, provided
that public access and use will be subject to public safety and construction logistics
considerations.
iv. Unless part of a tax -credit project, certificates of occupancy for VLI/LI
BMR units located in separate building in the Retail District/Phase 1 shall receive their
certificates of occupancy prior to the last certificate of occupancy is issued for a market -rate unit
building located in the Retail District/Phase 1.
V. Phase I shall in no way be contingent on any portion of Phase 1 B.
b. Phase 1B. East side of Wolfe Road — the Northeast District
i. Before the final certificate of occupancy (which shall include tenant
improvements) is issued for a building in the Northeast District, Developer will have
accomplished one of the following: (i) commenced construction of the superstructure for the
New City Hall work pursuant to this Agreement or (ii) made the City Hall Payment. Certificates
of occupancy (whether for core and shell or tenant improvements) for the Northeast District shall
not be delayed, regardless of the status of Phase I work.
ii. The East Plaza and all public open space, street and landscaping
improvements in the Northeast District shall be completed within 1 year of the final certificate of
occupancy is issued for use of the buildings in the Northeast District.
iii. Phase 1 B shall in no way be contingent on any portion of Phase 1 A.
Exhibit C-1
H. Phase 2. Developer shall not be precluded from commencing Phase 2A and/or Phase 2B,
as described below, with the first phase along with at a minimum, Phase IA. Phase 2B may
proceed before Phase 2A, and visa versa.
C. Phase 2. Downtown Neighborhood District
West side of Wolfe Road — the Downtown Neiahborhood (the "D
District"
A. Before the first temporary certificate of occupancy (core and shell)
is issued for a building in the DN District, Developer will complete the Town Square and obtain
TCOs for core and shell for the retail mixed use buildings (including sign -off of building
inspection for rough -in before interior finish work start for residential above) for buildings
surrounding the Plaza (as allowed under the Retail District, Phase IA) and associated parking for
those buildings in Phase IA, the DN District, except to the extent development is delayed
because of (i) the continued operation of leases that existed as of the Effective Date, (ii) due to
other life safety and other reasonable construction feasibility issues, and (iii) except for the PAC
(which is on separate delivery schedule under this Agreement), provided that public access and
use will be subject to public safety and construction logistics considerations.
B. Buildings along Wolfe Road, the Town Square and Wolfe Road
frontage road improvements for the west side shall be completed prior to building along the
interior of the Project in the DN District, provided that public access and use will be subject to
public safety and construction logistics considerations.
C. All other public open space, street and common area landscaping
improvements in the DN District shall be completed within 12 months of the issuance of the last
certificate of occupancy for use of a building in the DN District, provided that public access and
use will be subject to public safety and construction logistics considerations.
D. Unless part of a tax -credit project, certificates of occupancy for
VLULI BMR units located in separate building in the DN District shall receive their certificates
of occupancy prior to the last certificate of occupancy is issued for a market -rate unit building
located in the DN District.
d. Phase 2B. Retail and Entertainment District. Includina Sears (the "Retail
District/Phase 2")
i. Retail District/Phase 2 shall include the portion of the property including
the Sears department store.
ii. All public open space, street and common area landscaping improvements
in the Retail District/Phase 2 shall be completed within 12 months of the issuance of the last
certificate of occupancy for use of a building in the Retail District/Phase 2, provided that public
access and use will be subject to public safety and construction logistics considerations.
iii. Unless part of a tax -credit project, certificates of occupancy for VLULI
BMR units located in separate building in the Retail District/Phase 2 shall receive their
Exhibit C-2
certificates of occupancy prior to the last certificate of occupancy is issued for a market -rate unit
building located in the Retail District/Phase 2.
e. Parking
Parking shall be provided over the course of the Project and no less than commensurately
with the occupancy of the buildings with which it is associated. If ever Developer requires
additional temporary parking, it shall be allowed to provide temporary parking or other managed
parking solutions elsewhere on the Property or in the Plan Area.
Exhibit C-3
EXHIBIT D
HOUSING PLAN
1. Residential Development. A total of 2,668 Residential Units can be developed on
the site, including the applicable density bonus, as described in the Vallco Specific Plan. There
are no restrictions on rental or for sale rates for Market Rate Units. No more than 50% of the
total number of Residential Units, excluding any units financed with Low Income Housing Tax
Credits, may be parcelized as condominium units for individual sale.
2. BMR Units. A total of twenty percent (20%) of all Residential Units developed
on the Property shall be affordable to Extremely Low Income Households, Very Low Income
Households, Low Income Households and Moderate Income Households (collectively, the
"BMR Units"). Residential Units that are not BMR Units are permitted to be Market Rate Units.
Based on the maximum development of 2,668 Residential Units permitted under this Agreement,
534 Residential Units would be BMR Units.
a. Extremely Low and Very Low Income Units. Eleven percent of the base
permitted density, or 196 Residential Units (7.34 percent of the total maximum permitted density
with the applicable density bonus), would be.Very Low Income Residential Units. Very Low
Income means the rental rate is set such that it is affordable to a household with an income that is
not more than 50% of area median income ("AMI"), adjusted for household size appropriate for
the unit. Forty (40) of the Very Low Income Residential Units would be further restricted as
Extremely Low Income Residential Units. "Extremely Low Income" or "ELI" means the rental
rate is set such that it is affordable to a household with an income that is not more than 30% of
AMI, adjusted for household size appropriate for the unit. Developer is permitted to include
preferences for developmentally disabled individuals that Developer has proposed as part of the
Project to the extent consistent with applicable fair housing laws. All Extremely Low Income
and Very Low Income Units will be rental units. Rents for the Extremely Low Income and Very
Low Income Units shall be set at an affordable rent as defined in Section 50053 of the Health
and Safety Code
b. Low Income Units. 7.66 percent of the Residential Units (when combined
with the Extremely Low Income and Very Low Income Units, 15% of the total Residential
Units), or 205 Residential Units based on the maximum permitted density, would be Low
Income Residential Units. Low Income means the rental rate is set such that it is affordable to a
household with an income that is not more than the 80% AMI level, adjusted for household size
appropriate for the unit, and may be set lower at the Developer's discretion to compete for Low
Income Housing Tax Credit (LIHTC) financing. All Low Income Units will be rental units.
C. Moderate Income Units. Five percent of the Residential Units, or 133
Residential Units would be Moderate Income Residential Units. Moderate Income means the
rental rate is set such that it is affordable to a household with an income that is at the 120% AMI
level for rental units, adjusted for household size appropriate for the unit, and the sales price is
affordable to a household with an income that is at the 150% AMI level for for -sale units.
Exhibit D-1
i. Moderate Income Residential Units may be for lease or sale, as
determined by Developer in Developer's discretion; provided that any for -sale
Moderate Income Residential Units elected to be provided shall count towards the
maximum number of condominium units permitted under Paragraph 1, above.
ii. Prior to issuance of a building permit for a residential building
including moderate income BMR units, the BMR units will be designated per the
BMR Manual. Deed restrictions will be completed for units in each building
before certificates of occupancy for the building are issued.
d. BMR Units. All BMR Units shall be identified before building permits are
issued for construction of the building in which the BMR Units are located and deed restrictions
recorded prior to issuance of the certificate of occupancy of the building in which the BMR Units
are located.
BMR Units - Term.
a. Extremely Low Income, Very Low Income and Low Income Residential
Units. Extremely Low Income, Very Low Income and Low Income Residential Units must have
a restrictive covenant with a term of 55 years and may be located as provided in Paragraph 4(a).
Without limiting the affordability requirements in Paragraph 2, above, Developer shall retain
flexibility to program BMR buildings with unit types and income levels consistent with then -
current LIHTC requirements. Currently for 4% tax credits, household income limits may range
up to 80% AMI, as long as the project's average targeting does not exceed 50% AMI. Currently
for 9% tax credits, household income limits may range up to 80% AMI, as long as the project's
average targeting does not exceed 50% AMI. Accordingly, Low Income Units up to 80% AMI
shall be allowed as long as the average targeting complies with LIHTC requirements. The parties
acknowledge and agree that averaging may change to conform with then -current LIHTC
requirements, and that deeper affordability levels may be required for Developer's tax credit
application to be successful.
b. Moderate Income Residential Units. Moderate Income Residential Units
must have a restrictive covenant term of 99 years and be located as provided in Paragraph 4(b).
4. Distribution of BMR Units.
a. Extremely Low Income, Very Low Income and Low Income Residential
Units. Extremely Low Income, Very Low Income and Low Income Residential Units can be
consolidated in separate buildings and/or on separate legal parcels and lots from Market Rate
Residential Units to the extent consistent with Section 7.6 of this Development Agreement.
b. Moderate Income Residential Units. Except for separate buildings that are
made up entirely of BMR Units, approximately 5% of each residential building must consist of
Moderate Income Residential Units and such Moderate Income Residential Units must be
disbursed proportionally throughout each residential building.
5. Timing of Delivery of BMR Units.
Exhibit D-2
a. Developer will endeavor to build separate BMR Unit residential buildings
at approximately the same time and that BMR units must be developed roughly in proportion
with the delivery of market rate units, provided that City recognizes that delivery of BMR units
may be affected by and delayed due to market conditions, logistics, and financing considerations.
b. Developer shall use commercially reasonable efforts to obtain, by the
earliest reasonable date as appropriate by Project phase, financing for the BMR Units, including,
without limitation, timely filing applications for LIHTC financing with TCAC, beginning with
the first round for which applications are due following the date on which the City approves
Architectural and Site Approval permits for a BMR Building.
C. If efforts to obtain LIHTC financing are not successful in the first
submission made with respect to the BMR Units, Developer shall continue to apply for two
additional rounds or until successful, whichever occurs first.
d. If Developer is unable to secure LIHTC financing after three rounds of
applications to TCAC, Developer shall provide the City with security in a form acceptable to the
City in an amount to cover the otherwise applicable City Affordable Housing Fee, and Developer
shall be responsible for securing feasible financing for the BMR Units to complete construction
within a reasonable timeframe mutually agreed upon by the parties.
6. Management. Developer or its designee is required to prepare and maintain
(subject to the City's review and consent) a marketing plan, lottery, and waitlist for the BMR
Units that complies with the Housing Mitigation Manual and other applicable City Guidelines
for leasing, sale, maintenance, record-keeping, and other factors related to administration of the
BMR Units, whether in separate tax credit building or included in market rate buildings. The
Developer or its designee is required to follow the City's monitoring and reporting process,
including submitting annual reports related to income certification to the City; provided,
however, that the City will accept reports submitted to TCAC to satisfy this requirement for
BMR Units subject to LIHTC financing. The City may require Developer to pay an annual
monitoring fee to cover the City's costs (including outside consultant, legal, and staff time) of
ensuring compliance with the requirements of this Housing Plan for BMR Units. Applicants,
tenants, and prospective purchasers (if applicable) would have the ability to appeal
determinations of the Developer's program administrator to the City's hearing officer before
determinations are final. In the event of an appeal, all parties will cooperate in the timely
provision and review of material to facilitate a final decision before a unit is transferred to a
prospective renter or purchaser or before Developer's program administrator provides a notice of
termination, as applicable.
7. Unit size and coin arp ability parking; amenities.
a. Developer has discretion regarding comparability of finishes in all BMR
Units, provided that construction, features and finishes are durable, of good quality, and
consistent with contemporary standards for new housing.
b. In all Moderate Income Residential Units, the number of bedrooms per
unit shall be generally proportional to the number of bedrooms in the Market Rate Units
Exhibit D-3
consistent with the City's BMR Manual, provided that the Developer may substitute 2 -bedroom
Moderate Income Residential Units for Market Rate Units with three or more bedrooms. The
number of bedrooms per unit shall be "generally proportional" if the Moderate Income
Residential Unit bedroom mix is within 10% of the Market Rate Unit bedroom mix. The
bedroom mix for Extremely Low Income, Very Low Income and Low Income Residential Units
may be flexible to optimize the unit mix for a competitive LIHTC application.
C. Unit sizes of Moderate Income Residential Units may be flexible,
provided that the bedroom requirements establishing in Paragraph 7(b) are satisfied. Unit sizes
may be reduced for Extremely Low Income, Very Low Income and Low Income Residential
Units that are provided in separate buildings.
d. For all BMR Units, automobile parking spaces shall be provided
consistent with the Specific Plan, with the Developer retaining flexibility to assign such spaces
based on household requirements, and if parking for the Market -Rate Units is unbundled, then
Developer may do the same for Moderate Income Residential Units. In Moderate Income
Residential Units distributed throughout the Project, Developer shall allocate and assign bicycle
storage, storage lockers, and other spaces reserved for use by individual units to the Moderate
Income Residential Units on the same basis as for the Market Rate Units.
e. Tenants of all BMR Units shall generally have equal access to the
Project's common areas as is given to the residents of the Market Rate Units, provided that (i)
residents of one building are not required to be given access to amenities in other buildings
where such amenities are limited for the use of residents of that building and (ii) residents of
BMR units, as well as residents of certain types of Market Rate Units, will not have access to
certain common area amenities offered exclusively to (a) residents of premium Market Rate
Units or (b) residents of senior Residential Units, at the sole discretion of Developer.
8. Affordable Housing Agreement. Prior to issuance of the first building permit,
Developer and City shall enter into and record an Affordable Housing Agreement, which shall
address, among other things: BMR Unit delivery schedule and locations, a definition of what is
included in rent, unit comparability, marketing guidelines, tenant selection and income
certification processes, affordability covenants and enforcement provisions, occupancy
requirements, income monitoring, provisions regarding termination of occupancy, forms of lease
or key lease provisions, records and reporting, operation, management, use and maintenance of
property, including with respect to landscaping and open space and participation in Project
owners'/tenants' association and transportation program. The Affordable Housing Agreement
shall have priority over the liens of any Mortgages, and Developer shall use good faith diligent
efforts to cause any Mortgagees with Mortgages in place at the time the Affordable Housing
Agreement is recorded to execute, acknowledge and deliver to City subordination agreements in
a form reasonably acceptable to the City Attorney subordination the liens of such Mortgages to
the Affordable Housing Agreement.
9. Senior Housing. The permitted Market -Rate Residential Units include at least 80
senior Residential Units, whether for rent or for sale at Developer's discretion, provided that any
for -sale senior units elected to be provided shall count towards the maximum number of
Exhibit D-4
condominium units permitted under Paragraph 1, above. Age restrictions on Senior Housing
shall be according to State law.
Exhibit D-5
EXHIBIT E
ANNUAL REVIEW FORM
This Annual Review Form is submitted to the City of Cupertino ("City") by
("Developer") pursuant to the requirements of California Government
Code section 65865.1 and Chapter 19.144 of the City's Municipal Code regarding Developer's
good faith compliance with its obligations under the Development Agreement between the City
and Developer having an Effective Date of ("Development Agreement").
All Article and Section references are to the Development Agreement. Any capitalized terms not
otherwise defined herein shall have the meanings assigned to them in the Development
Agreement.
Annual Review Period: to
Generally summarize the status of Developer's efforts and progress in processing permit
applications and constructing and selling or leasing individual components of the Project under
the Development Agreement.
Generally summarize specific strategies to be followed in the coming year intended to
facilitate the processing of permits and or Project construction.
Specify whether Developer's compliance with any of the following agreements have
been satisfied during this annual review period:
• New City Hall Agreement (if applicable)
• PAC Agreement (if applicable)
• Affordable Housing Agreement
Specify whether applicable Impact Fees, processing fees, connection fees and/or other
fees due and payable under Article 4 have been paid during this annual review period, including
but not limited to the following:
• TIF
• Affordable Housing
Describe whether Developer's compliance with any of the following public benefits
under Article 5 have been satisfied during this annual review period:
• New City Hall (or City Hall Payment if applicable)
• PAC (or PAC In Lieu Payment if applicable)
• School District obligations
• Transportation obligations
Exhibit E-1
• Housing, including affordable housing, obligations
Describe whether other applicable Development Agreement obligations were completed
during this annual review period.
Describe any extension of the Initial Term of the Development Agreement as a result of
either Section 2.2.1 or Permitted Delay pursuant to Section 13.4.
Specify whether Developer has assigned the Development Agreement or otherwise
conveyed the Property during this annual review period.
The undersigned representative confirms that Developer is:
In good faith compliance with its obligations under the Development Agreement
for this annual review period.
Not in good faith compliance with its obligations under the Development
Agreement for this annual review period, in response to which Developer is taking the actions set
forth in the attachment hereto.
IN WITNESS WHEREOF, Developer has executed this Annual Review Form as of this
day of , 20_.
DEVELOPER:
a
By:
Name:
Title:
Exhibit E-2
EXHIBIT F
FORM OF ASSIGNMENT AND ASSUMPTION AGREEMENT
RECORDING REQUESTED BY
AND WHEN RECORDED MAIL TO:
Attention:
Exempt from Recording Fee per
Government Code Section 27383
Space Above This Line for Recorder's Use Only
ASSIGNMENT OF RIGHTS AND OBLIGATIONS UNDER
DEVELOPMENT AGREEMENT
This Assignment of Rights and Obligations under Development Agreement (this
"Assignment") is entered into this day of , 20_ ("Effective Date"),
by and between , a
("Assignor") and , a
("Assignee"). Assignor and Assignee are collectively referred to herein as the "Parties."
RECITALS
A. Assignor and the City of Cupertino, a California municipal corporation ("City")
have entered into that certain Development Agreement dated as of 32018
("DA") which was recorded in the Official Records of Santa Clara County on ,
2018 as Instrument No.
B. Assignor [has requested approval from the City of the assignment to Assignee
described herein pursuant to Section 10.1 of the DA] [has the right to make the assignment
to Assignee under Section 10.1 of the DA.]
C. [City has consented to the assignment described herein pursuant to Section
10.1 of the DA.] [Assignor has provided the City with documentation establishing that the
assignment is appropriate pursuant to Article 10 of the DA because .]
AGREEMENTS
NOW, THEREFORE, in exchange for the mutual covenants set forth herein and for other
good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged,
the Parties hereby agree as follows:
1. Assignment and Assumption of Interest. Assignor hereby transfers, assigns and
conveys to Assignee, all of Assignor's right, title and interest in and to, and all obligations,
Exhibit F -I
duties, responsibilities, conditions and restrictions under, the DA (the "Rights and
Obligations"). Assignee, for itself and its successors and assigns, hereby accepts the foregoing
assignment, assumes all such Rights and Obligations, and expressly agrees for the benefit of
City, to pay, perforin and discharge all obligations of Assignor under the DA and to comply with
all covenants and conditions of Assignor arising from or under the DA. [If partial transfer,
parties to insert allocation of rights, duties and obligations under the DA between the
transferred Property and the retained Property and acknowledgements regarding timing of
development based on phasing and other DA requirements]
2. Governing Law; Venue. This Assignment shall be interpreted and enforced in
accordance with the laws of the State of California without regard to principles of conflicts of
laws. Any action to enforce or interpret this Assignment shall be filed and litigated exclusively
in the Superior Court of Santa Clara County, California or in the Federal District Court for the
Northern District of California.
3. Entire Agreement/Amendment. This Assignment constitutes the entire agreement
among the Parties with respect to the subject matter hereof, and supersedes all prior written and
oral agreements with respect to the matters covered by this Assignment. This Assignment may
not be amended except by an instrument in writing signed by each of the Parties and consented
to in writing by City.
4. Further Assurances. Each Party shall execute and deliver such other certificates,
agreements and documents and take such other actions as may be reasonably required to
consummate or implement the transactions contemplated by this Assignment and the DA.
5. Benefit and Liability. Subject to the restrictions on transfer set forth in the DA,
this Assignment and all of the terms, covenants, and conditions hereof shall extend to the benefit
of and be binding upon the respective successors and permitted assigns of the Parties.
6. Rights of City. All rights of City under the DA and all obligations to City under
the DA which were enforceable by City against Assignor prior to the Effective Date of this
Assignment shall be fully enforceable by City against Assignee from and after the Effective Date
of this Assignment.
7. Rights of Assignee. All rights of Assignor and obligations to Assignor under the
DA which were enforceable by Assignor against City prior to the Effective Date of this
Assignment shall be fully enforceable by Assignee against City from and after the Effective Date
of this Assignment.
8. Release. As of the Effective Date, Assignor hereby relinquishes all rights under
the DA, and all obligations of Assignor under the DA shall be terminated as to, and shall have no
more force or effect with respect to, Assignor, and Assignor is hereby released from any and all
obligations under the DA.
9. Attorneys' Fees. In the event of any litigation pertaining to this Assignment, the
losing parry shall pay the prevailing party's litigation costs and expenses, including without
limitation reasonable attorneys' fees.
Exhibit F-2
10. City Consent; City Is A Third -Party Beneficiary. City's countersignature below is
for the limited purposes of indicating consent to the assignment and assumption and release set
forth in this Assignment (if necessary under the DA) pursuant to Sections 10.1 and 10.2 of the
DA, and for clarifying that there is privity of contract between City and Assignee with respect to
the DA. The City is an intended third -party beneficiary of this Assignment, and has the right, but
not the obligation, to enforce the provisions hereof.
11. Recordation. Assignor shall cause this Assignment to be recorded in the Official
Records of Santa Clara County, and shall promptly provide conformed copies of the recorded
Assignment to City and Assignee.
12. Address For Notices. Assignee's address for notices, demands and
communications under the DA is as follows:
[to be inserted]
13. Captions; Interpretation. The section headings used herein are solely for
convenience and shall not be used to interpret this Assignment. The Parties acknowledge that
this Assignment is the product of negotiation and compromise on the part of both Parties, and the
Parties agree, that since both have participated in the negotiation and drafting of this Assignment,
this Assignment shall not be construed as if prepared by one of the Parties, but rather according
to its fair meaning as a whole, as if both Parties had prepared it.
14. Severability. If any term, provision, condition or covenant of this Assignment or
its application to any party or circumstances shall be held by a court of competent jurisdiction, to
any extent, invalid or unenforceable, the remainder of this Assignment, or the application of the
term, provision, condition or covenant to persons or circumstances other than those as to whom
or which it is held invalid or unenforceable, shall not be affected, and shall be valid and
enforceable to the fullest extent permitted by law unless the rights and obligations of the Parties
have been materially altered or abridged thereby.
15. Counterparts. This Assignment may be executed in counterparts, each of which
shall, irrespective of the date of its execution and delivery, be deemed an original, and the
counterparts together shall constitute one and the same instrument.
IN WITNESS WHEREOF Assignor and Assignee have executed this Assignment as of
the date first set forth above.
Exhibit F-3
ASSIGNOR:
By:
Name:
Its:
ASSIGNEE:
a
FORM — DO NOT SIGN
a
By: FORM — DO NOT SIGN
Name:
Its:
[NOTE: The presence of the signature blocks below in this form shall not be deemed to require
the consent of the City to any assignment that does not otherwise require the consent of City
under the DA.]
City of Cupertino, a California municipal corporation,
hereby consents to the assignment and assumption
described in the foregoing Assignment and Assumption
Agreement.
CITY:
CITY OF CUPERTINO, a
California municipal corporation
By: FORM — DO NOT SIGN
City Manager
ATTEST:
, City Clerk
APPROVED AS TO FORM:
, City Attorney
Exhibit F-4
ACKNOWLEDGMENT
A notary public or other officer completing this
certificate verifies only the identity of the
individual who signed the document to which this
certificate is attached, and not the truthfulness,
accuracy, or validity of that document.
State of California )
) ss
County of )
On , before
(Name of Notary)
notary public, personally appeared
who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are
subscribed to the within instrument and acknowledged to me that he/she/they executed the same
in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the
person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the
foregoing paragraph is true and correct.
WITNESS my hand and official seal.
(Notary Signature)
Acknowledgements
ACKNOWLEDGMENT
A notary public or other officer completing this
certificate verifies only the identity of the
individual who signed the document to which this
certificate is attached, and not the truthfulness,
accuracy, or validity of that document.
State of California )
ss
County of )
On , before
(Name of Notary)
notary public, personally appeared
who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are
subscribed to the within instrument and acknowledged to me that he/she/they executed the same
in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the
person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the
foregoing paragraph is true and correct.
WITNESS my hand and official seal.
(Notary Signature)
Acknowledgements
EXHIBIT G
NEW CITY HALL CRITERIA
The New City Hall shall be generally in conformance with the adopted 2015 Civic Center Master
Plan and Negative Declaration as modified to include the following:
I. Scope included:
a. 40,000 sq. ft. two story Core & Shell (warm) New City Hall building. Included
in the building cost is a premium for providing a critical facility within the
building.
b. Approximately 118 stalls one level underground garage
C. Associated site work in the construction area to connect into existing site work
area as follows
i. The new Parking Lot Asphalt to connect to the existing parking lot asphalt and
will be similar standards of existing asphalt
ii. The New City Hall building will be connected via a pedestrian concrete
sidewalk to the existing Library/Civic Plaza per the City sidewalk standards
iii. The other sides of the New City Hall building namely, the parking lot side,
Torre and Rodriguez side will have connection (Steps)/ Sidewalks. These
sidewalks will be per City per the City standards.
II. The following items from the attached modified Civic Center Master plan sketches
(collectively, the "Excluded Items") are NOT included in the New City Hall scope:
1. Library expansion and the plaza improvements
2. Tenant Improvement scopes of work for the 2 story City Hall building
3. Green roof or solar panels — See III (11) below.
4. Additional below grade parking shown in the Master Plan
5. Additional parking on the library fields shown in the Master Plan
III. The included scope in I. above is based on the following design criteria:
Concrete one level parking garage with shotcrete walls included and furnished
with Code minimum fire sprinklers system, fire alarm system and lighting.
2. The New City Hall building will be core and shell (warm shell box) where the
box will consist of building envelope and roof.
Exhibit G-1
3. Mechanical units will be provided on the roof and will be stubbed into the
building for distribution under tenant improvement scope performed by City.
4. All utilities including fire stand pipe will be stubbed in to the building for TI to
distribute.
Electrical panels will be provided and electrical services will be brought from the
existing transformer connection location point into the building to a location to be
shown in the construction drawings.
6. The exterior envelope will be either wood frame with stucco and glass windows
or metal stud framing with stucco and glass windows.
7. Store front doors will be provided. All exterior doors and hardware will be
provided.
8. All utility connections from the existing connection points to be brought into the
building to a location to be shown in the construction drawings.
9. The site work in the construction zone is included to have standard landscaping
with irrigation and the parking lot to be asphalt, and concrete sidewalks
commensurate with existing improvements. Any damage to be restored to
original state.
10. The C & S of the building design to LEED Silver only.
11. Roofing will be an industry standard roofing material.
12. Roof will be designed and built to allow for solar panels to be installed by the
City.
In addition to above scope and design criteria items,scope, Developer will provide a $4 Million
allowance to City to use for any of the following in City's discretion:
The incremental costs of any design upgrades to the included design criteria in
this DA that City desires be included in the scope for the New City Hall.
2. The incremental costs to be borne by City pursuant to the terms of the Agreement
as a result of delays due to Litigation Challenges and its impacts on schedule and
consequent cost escalations.
The construction of the New City Hall is subject to the following:
1. Except as otherwise required by Applicable Law, Developer does not have to
follow the Public Contracting Code requirements in procuring contractors and
materials.
Exhibit G-2
2. Developer will use union affiliated general contractors and require the general
contractor to hire union skilled crafts sub -contractors in constructing City Hall or,
if required under Applicable Law, comply and cause its contractors and
subcontractors to comply with Prevailing Wage Laws.
Exhibit G-3