DISPOSITION AND DEVELOPMENT AGREEMENT
by and between
THE CITY OF COTATI
AND
FREEBIRD DEVELOPMENT COMPANY, LLC
Dated as of ________________, 2026
DISPOSITION AND DEVELOPMENT AGREEMENT
120 EAST COTATI AFFORDABLE HOUSING PROJECT
This Disposition and Development Agreement (“Agreement”) is entered into as of ________________, 2026 (the “Effective Date”), by and between the CITY OF COTATI, a California municipal corporation (the “City”), and FREEBIRD DEVELOPMENT COMPANY, LLC, a California limited liability company (the “Developer”). The City and Developer may be referred to individually as a “Party” or together as the “Parties.”
RECITALS
A. Capitalized terms used but not defined in these Recitals shall have the meanings set forth in Article 1 below. The Parties intend to refer to those definitions in connection with the use of capitalized terms in these Recitals.
B. The City is the owner of three parcels of real property in the City of Cotati, legally described per Map recorded June 7, 1983, in Book 10, Pages 8 of Official Records, County of Sonoma, State of California, APNs 144-274-014, 144-274-015, and 144-274-002, as shown on the map attached as Exhibit A (collectively, the “Property”).
C. On February 13, 2024, the Council of the City of Cotati, by resolution, declared the Property “Exempt Surplus Land” in accordance with the terms, requirements, and provisions of the Surplus Land Act as that term is defined in California Government Code Section 54221(f)(1)(A) or 54221(f)(1)(F), making findings and justifications that the purchaser will be required to develop a project that is consistent with either Government Code Section 54221(f)(1)(A) or 54221(f)(1)(F). A copy of this Resolution was sent to the California Department of Housing and Community Development in accordance with the requirements of Section 400(e) of the Surplus Land Act Guidelines (April 2021), and the Guide to Exemptions from the Standard Surplus Land Act Process for Local Agencies issued by the California Department of Housing and Community Development (July 2022).
D. Development of the Property was put out for competitive bid on March 21, 2024 through a Request for Qualifications (RFQ) process with invitations to participate being sent to all known entities (over 170 individuals and firms) as identified in GC 54222, through which Freebird Development LLC was the chosen partners with which to develop the Property.
E. The affordable housing project on the Property, including parking and related improvements (collectively, the “Project” or “Improvements”), is detailed in the Scope of Development attached as Exhibit C and the Conditions of Approval attached as Exhibit E.
F. The City and Developer entered into an Exclusive Negotiating Rights Agreement dated July 20, 2024 (the “ENRA”), to negotiate and prepare this Agreement, which supersedes the ENRA upon execution.
G. The Developer and City conducted public workshops on September 18 and November 20, 2024, followed by an initial presentation to the City Council on December 10, 2024.
H. Based on feedback from the initial public workshops and City Council presentation, the Developer presented the proposed project to the Planning Commission on August 18, 2025 and then the City Council on August 26, 2025.
I. The Project will consist of a three-story mixed-use affordable housing development with approximately forty-four (44) rental units, including one (1) manager’s unit and approximately forty-three (43) affordable rental units subject to a City Regulatory Agreement substantially in the form attached to this Agreement as Exhibit D (the “City Regulatory Agreement”). The Project is also anticipated to include on-site parking, and indoor amenity space including a community room, a lobby, laundry facilities and a property management office. Commercial space on the ground floor fronting onto La Plaza and East Cotati Avenue is also desired. Outdoor recreation areas are anticipated to include one or more courtyards, with pedestrian and bike infrastructure anticipated to be included along the project frontage.
J. The Regulatory Agreement will restrict all units (except the manager’s unit) to households earning up to 80% of area median income for Sonoma County, California, adjusted for actual household size, as determined by the U.S. Department of Housing and Urban Development pursuant to Section 8 of the United States Housing Act of 1937 and as published from time to time by the State of California Department of Housing and Community Development in Section 6932 of Title 25 of the California Code of Regulations. The Project is more particularly described, including the anticipated affordability level distribution, in the Scope of Development attached to this Agreement as Exhibit C and Conditions of Approval attached as Exhibit E.
K. The Parties wish to enter into this Agreement to set forth the terms and conditions relating to City’s disposition of the City Property to the Developer and the Developer’s obligation to construct and operate the Project consistent with the terms of this Agreement.
L. The Project aligns with the City’s General Plan and housing goals, enhancing the supply of affordable housing in Cotati.
NOW, THEREFORE, in reliance on the foregoing Recitals, which are incorporated herein, and for good and valuable consideration, the Parties agree as follows:
ARTICLE 1.
TERM, DEFINITIONS, AND EXHIBITS
Section 1.1 Term
The term of this Agreement will commence on the Effective Date and will end on the earlier of:
(a) the date the Project receives a Certificate of Completion, as defined in Section 5.7, or (b) December 31, 2032, unless extended by mutual agreement of the Parties (“Outside Date”).
Section 1.2 Definitions
The following terms shall have the meanings set forth below unless the context requires otherwise:
a) “Agreement” means this Disposition and Development Agreement, including all Exhibits.
b) “CDLAC” means the California Debt Limit Allocation Committee c) “City” means the City of Cotati, a California municipal corporation. d) “City Property” or “Property” means the real property described in Recital B and Exhibit A.
e) “City Manager” means the City Manager of Cotati or their designee. f) “City Regulatory Agreement” means the regulatory agreement restricting the Project’s affordable units, attached as Exhibit D.
g) “Close of Escrow” or “Closing” means the date the Grant Deed is recorded, no later than thirty (30) days after all conditions precedent are satisfied or waived, unless extended by the Parties.
h) “Council members” means the City Council members of the City of Cotati. i) “Day” means calendar day, unless specified otherwise. j) “Default” means the failure of a Party to perform any action or covenant required by this Agreement within the time periods provided herein following notice and opportunity to cure.
k) “Developer” means Freebird Development Company, LLC, a California limited liability company, and its permitted successors or assigns.
l) “Development”, “Improvements” or “Project” means the Property and the affordable housing project described in Recital I and Exhibit C..
m) “Due Diligence Period” has the meaning set forth in Section 2.3. n) “Effective Date” means the first date mentioned above in this Agreement. o) “Escrow” means the escrow established with the Title Company for Property conveyance and loan disbursement.
p) “Financing Plan” means the Developer’s plan for financing the Project, approved by the City, revised as needed per Section 2.4.
q) “Grant Deed” means the deed conveying the Property from the City to the Developer. r) “Hazardous Materials” means any hazardous or toxic substances, materials, wastes, pollutants, or contaminants which are defined, regulated, or listed as “hazardous substances,” “hazardous wastes,” “hazardous materials,” “pollutants,” “contaminants,” or “toxic substances” under applicable Hazardous Materials Laws, including without limitation petroleum and petroleum byproducts, flammable explosives, urea formaldehyde insulation, radioactive materials, asbestos, and lead. Hazardous Materials do not include substances that are used or consumed in the normal course of constructing, developing, operating, or occupying a mixed-use project, to the extent and degree that such substances are stored, used, and disposed of in the manner and in amounts that are consistent with normal practice and legal standards.
s) “Hazardous Materials Laws” means Federal, state, and local laws regulating Hazardous Materials.
t) “Opening of Escrow” means the date a copy of this fully executed Agreement is deposited with the Title Company and a request on Escrow Holder is made to open escrow.
u) “Owner’s Title Policy” means, at Developer’s option, either a CLTA or ALTA owner’s policy of title insurance in favor of Developer, the premium of which (including the cost of any endorsements required by Developer) shall be paid by Developer. v) “Property” or “City Property” means the real property described in Recital B and Exhibit A.
w) “Schedule of Performance” means the timeline for Project tasks, attached as Exhibit B. x) “Scope of Development” means the Project description, attached as Exhibit C, including the Conditions of Approval, attached as Exhibit E.
y) “TCAC” means the California Tax Credit Allocation Committee. z) “Term” means from the Effective Date until the earlier of (a) issuance of the Certificate of Completion, or (b) the Outside Date, unless extended; provided regulatory obligations extend per Exhibit D.
aa) “Title Company”: Old Republic Title Company, Oakland, California, or another mutually agreed escrow title company.
bb) “Title Report” means the preliminary title report for the Property dated January 17, 2025, prepared by Old Republic Title Company, Oakland, California.
Section 1.3 Exhibits
The following exhibits are attached to and incorporated in the Agreement:
• Exhibit A: Legal Description and Map of the Property
• Exhibit B: Schedule of Performance
• Exhibit C: Scope of Development (Entitlement Plan Set, reviewed by the City Council on August 26, 2025)
• Exhibit D: City Regulatory Agreement
• Exhibit E: Conditions of Approval
ARTICLE 2.
PREDISPOSITION ACTIVITIES
Section 2.1 Schedule of Performance
Tasks must be completed per the Schedule of Performance (Exhibit B), subject to Force Majeure delays (Section 9.3). The Schedule of Performance may be modified by Operating Memoranda as described in Section 9.14, executed by the Developer and by the City Manager on behalf of the City without formal amendment of this Agreement.
Section 2.2 Developer Deposit
In connection with the execution of the ENRA, the Develofinper deposited TWENTY-FIVE THOUSAND Dollars ($25,000) with the City which deposit was not subject to being increased without the consent of the Developer (the “Deposit”). The Deposit was to be used by the City to pay for the City’s third-party consultant costs and expenses associated with the negotiation and preparation of this Agreement. Within five (5) business days of the Effective Date of this Agreement, the City shall return the remaining amount of the Deposit to the Developer.
Section 2.3 Developer Due Diligence
Prior to the conveyance of the Property from the City to the Developer, and it’s representatives , agents, and/or contractors (collectively, “Developer Parties”), shall have the right of access to the Property at all reasonable times, upon not less than forty-eight hours’ prior notice, to inspect and conduct such studies of the Property as the Developer, in its sole discretion, may desire for a period of one hundred eighty (180) days following the Effective Date (the “Due Diligence Period”). On or before the expiration of the Due Diligence Period, the Developer shall give written notice to the City as to whether the Developer approves or disapproves of the Property.
During the Due Diligence Period, the City shall provide the Developer Parties the right to enter upon all portions of the Property for the purposes of conducting soils tests, engineering studies, seismic and geologic studies, inspections and testing for Hazardous Materials, and underground storage tanks, investigation of applicable zoning and other land use regulations, analysis of economic feasibility and other studies related to the Developer Parties use of the Property and the condition of the Property. The Developer shall hold the City harmless for any injury or damages arising out of any activity pursuant to this Section. The Developer Parties shall have access to all data and information on the Property available to the City, but without warranty or representation by the City as to the completeness, correctness or validity of such data and information. Notwithstanding the foregoing, the City shall disclose to Buyer any and all known violations or notices of violation issued by any governmental authority, any unrecorded liens, easements, covenants, or other title encumbrances affecting the Property, and any other known material conditions or facts relating to the Property that would reasonably be expected to affect its value, use, or compliance with applicable laws.
Section 2.4 Financing Plan
a) Tax Credit Financing and Other Financing. Development of the Project is contingent upon (a) Developer receiving a sufficient allocation (“Tax Credit Allocation”) of lowincome housing tax credits (“Tax Credits”) from the California Tax Credit Allocation Committee (“TCAC”); and (b) Developer obtaining all other financial commitments in addition to the City’s participation to enable the Developer to finance the Project. This Agreement assumes that the Project will be financed, in part, with Tax Credits. However, Developer shall have the right to apply for additional or different sources of financing as Developer determines is necessary to ensure the feasibility of the Project, and the City Manager, in his or her reasonable discretion, shall have the authority to make all necessary amendments and/or modifications to the Agreement, including its attachments, to reflect the ultimate financing structure.
b) Financing Plan. As of the Effective Date, the City has approved the initial Financing Plan that includes potential financing from the State of California Department of Housing and Community Development and other potential sources that the Developer intends to pursue for the Project, as may be subsequently amended and approved by the City Manager. As included in the Financing Plan, the City commits to waive certain City development impact fees—specifically water conservation, traffic, park and recreation, general plan, linkage, and fire impact fees—excluding water and sewer impact fees, in the amounts published at the time of building permit issuance (the “Waived Impact Fees”). Based on the City’s current published fee schedules, the estimated value of the Waived Impact Fees is $1,566,170; however, the actual amount will be determined at the time of building permit issuance. No later than the date set forth in the Schedule of Performance, the Developer shall submit an updated and revised Financing Plan which shall include a development budget, and copies of secured funding commitments. The City shall approve or disapprove the revised Financing Plan in writing within fifteen (15) calendar days after the City’s receipt, which approval shall not be unreasonably withheld, conditioned or denied. Failure by the City to either approve or disapprove a submission made by the Developer within the time set forth above shall be deemed an approval. If the Financing Plan is disapproved by the City, the Developer shall have thirty (30) calendar days from the date of the Developer’s receipt of the City’s notice of disapproval to submit a revised Financing Plan. In the event the City disapproves the submission a second time, the City and the Developer agree to negotiate in good faith to develop a submission that is reasonably acceptable to both the City and the Developer within a reasonable period of time, provided that in no case shall the City be entitled to require changes inconsistent with the initial Financing Plan and any previously approved items.
All financing necessary to acquire the Property and develop the Development, as approved by the City in the Financing Plan (not including permanent financing), shall be closed by the Developer prior to, or simultaneously with, the conveyance of the Property by the City to the Developer.
Section 2.5 Tax Credit Applications
(a) The Developer shall submit a timely and complete application to TCAC for a preliminary reservation of Tax Credits, which may include an application for 9%, and/or 4% Tax Credits and an application to the California Debt Limit Allocation Committee (“CDLAC”) for an allocation for tax exempt bonds within the time set forth in the Schedule of Performance and continue to submit such applications in each subsequent round until successful.
Section 2.6 Updated Preliminary Title Report
(a) Developer shall have an initial ninety (90) days from the Effective Date (the “Title Review Period”) to review the condition of title to the Property and to deliver to City any written title objections. City shall have thirty (30) days after receipt of Developer’s objections to notify Developer in writing of City’s proposed course of action, which shall include, either (i) remove the objection from title to the property at its sole cost prior to Closing, or (ii) decline to take any action with respect to such objection. Within thirty (30) days after receipt of City’s election or the expiration of the time for City to respond, Developer may elect, in its sole discretion, to (A) terminate this Agreement, in which event any remaining deposits shall be returned to Developer and the parties shall have no further obligations except those that expressly survive termination, or (B) to take such actions necessary to remove the exception, which may include obtaining an endorsement insuring over such exception subject to such conditions and requirements imposed by Escrow Holder, or (C) proceed with the transaction in accordance with the terms of this Agreement notwithstanding City’s election. If Developer elects clause (B) and fails to so terminate or otherwise cure within the fifteen (15) day period, then at Developer’s option, it shall be deemed to have elected clause (A) above.
(b) Following the Effective Date and prior to the Close of Escrow, the City agrees that it shall not voluntarily permit or cause to be created any exceptions to title without Developer’s prior written consent, which shall not be unreasonably withheld (the “City's Title Covenant”). A breach of the City’s Title Covenant shall be a Default. If, following the Effective Date and prior to the Close of Escrow, any new exceptions to title arise without Developer’s prior written consent, then Developer may object to such new exception by notice to City given within fifteen (15) days after Developer receives written notice of the new exception. If Developer fails to object within such period, then the new exception will be deemed to be a permitted exception. If the Developer does object, then City may elect in City’s sole and absolute discretion, at its cost, to remove any such new exceptions prior to the Close of Escrow. If City does so elect, it will notify Developer within ten (10) days after receipt of Developer’s objection. If City elects not to remove or cause to be eliminated the exception, or fails to respond within the ten (10) day period, then Developer shall have the right to: (i) terminate this Agreement by notice to City delivered within ten (10) days after Developer receives City's notice that it has elected not to remove or cause to be eliminated the exception or expiration of the ten (10) day period, whichever occurs earlier; (ii) upon written notice provided to City within ten (10) days of City's election not to remove or cause to be eliminated the exception or failure to respond, diligently proceed to take such actions necessary to remove the exception, which may include obtaining an endorsement insuring over such exception subject to such conditions and requirements imposed by Escrow Holder; or (iii) proceed with the Close of Escrow subject to such exception. If Developer elects clause (ii) and fails to so terminate or elect to cure within the ten (10) day period, then it shall be deemed to have elected clause (iii) above. Exceptions that City elects not to remove or cause to be eliminated, or is deemed to have elected not to remove or cause to be eliminated, and that Developer elects to accept, or is deemed to have accepted, are also permitted exceptions.
Section 2.7 Construction Plans
During the Term, the Developer shall submit its Construction Plans to the City building department for approval within the time set forth in the Schedule of Performance. “Construction Plans” means all construction documentation upon which the Developer and the Developer’s general contractor shall rely on for constructing the Improvements identified in the Scope of Development (Exhibit C) and Conditions of Approval (Exhibit E), which includes final architectural drawings, landscaping plans and specifications, final elevations, building plans and specifications (also known as “working drawings”).
ARTICLE 3.
CONVEYANCE OF THE PROPERTY
Section 3.1 Purchase and Sale
Subject to the terms and conditions of this Agreement, the City shall convey the Property to the Developer for eight hundred twenty-five thousand dollars ($825,000) (the “Purchase Price”), subject to this Agreement. The Property shall be conveyed by the City Grant Deed.
Section 3.2 Opening Escrow
Within 14 days of the Effective Date, the Parties shall open Escrow with the Title Company, using this Agreement as joint instructions.
Section 3.3 Conditions to Closing
The Close of Escrow is expressly conditioned upon and shall take place 30 days from the satisfaction of the following terms and conditions within the times designated below:
(a) City’s Conditions Precedent. City’s obligation to proceed with the Close of Escrow is subject to the fulfillment by Developer, or written waiver by City, of each and every one of the conditions precedent described below (“City’s Conditions Precedent”), which are solely for the benefit of City, and which shall be fulfilled or waived by the time periods provided for herein. If the City’s Conditions Precedent set forth in this Section are neither satisfied nor waived by the Outside Date, and provided that City is not then in default under this Agreement, City may terminate escrow and this Agreement by giving written notice of termination to the Developer and to Title Company, in which case the respective rights, duties and obligations of the Parties under this Agreement shall terminate without further liability, except for obligations that expressly survive termination of this Agreement. Notwithstanding anything to the contrary contained herein, Developer’s inability to satisfy the City’s Conditions Precedent set forth in this Section prior to the Outside Date shall not be considered a breach of this Agreement. The Close of Escrow under this Agreement constitutes satisfaction of the conditions precedent set forth below:
(i) Developer’s delivery of originals of the executed City Regulatory Agreement in a form approved by the Parties.
(ii) On or before the expiration of the Due Diligence Period, the Developer shall give written notice to the City that the Developer has approved the Property, as required by Section 2.3 of this Agreement. On or before the expiration of the Title Review Period, the Developer shall also provide written notice to the City that the Developer has approved the title to the Property, as required by Section 2.6. (iii) Developer’s deposit into Escrow, of the Purchase Price and all other sums to be deposited, or paid by Developer into Escrow in accordance with this Agreement. (iv) The Project shall have received approval of all land use entitlements, governmental approvals and permits necessary for the construction of the Project. (v) The City has determined that the construction of the Project is ready to commence within sixty days of the Closing.
(vi) An approved and complete financing plan for all debt and equity necessary to purchase the City Property and construct the Project has been approved by the City, and all financing required by the financing plan to close at or prior to Property acquisition shall have closed or shall be ready to close concurrently with the Closing. (vii) The Developer shall not be in Default of any of its obligations under the terms of this Agreement and all representations and warranties of Developer contained in Section 9.13 herein shall be true and correct in all material respects. (b) Developer’s Conditions Precedent. Developer’s obligation to proceed with the Close of Escrow is subject to the fulfillment by City, or written waiver by Developer, of each and all of the conditions precedent described below (“Developer’s Conditions Precedent”), which are solely for the benefit of Developer, and which shall be fulfilled or waived by the time periods provided for herein. If the Developer’s Conditions Precedent set forth in this Section are neither satisfied nor waived by the Outside Date, and provided that Developer is not then in default under this Agreement, Developer may terminate escrow and this Agreement by giving written notice of termination to City and Title Company, in which case the respective rights, duties and obligations of the Parties under this Agreement shall terminate without further liability, except for obligations that expressly survive termination of this Agreement. Notwithstanding anything to the contrary contained herein, City’s inability to satisfy the Developer’s Conditions Precedent, except for the Developer’s Condition Precedent identified in subsection (i) below, shall not be considered a breach of this Agreement. The Close of Escrow under this Agreement constitutes satisfaction of the conditions precedent set forth below:
(i) City shall have executed and acknowledged the Grant Deed granting a fee simple interest to the City Property and any other documents required of it hereunder, and delivered them to Escrow.
(ii) Prior to the Close of Escrow, City shall not be in Default in any of its obligations under the terms of this Agreement and all representations and warranties of City contained herein shall be true and correct in all material respects. (iii) The Title Company shall have committed to issue the Owner’s Title Policy.
(iv) Developer shall have obtained all City requisite approvals of the Project.
If unsatisfied by the Outside Date, the non-defaulting Party may terminate per Article 7.
Section 3.4 Closing Procedures
At Closing, the Title Company shall:
a) Record the Grant Deed, then the City Regulatory Agreement. b) Disburse the Purchase Price to the City.
c) Deliver the title policy to the Developer and a final settlement statement to the Parties.
Section 3.5 Costs of Escrow and Closing
Ad valorem taxes and assessments, if any, on the Property, and taxes upon this Agreement or any rights hereunder, levied, assessed or imposed for any period commencing prior to conveyance of title shall be borne by the City. The Developer shall pay the cost of all title insurance policies, transfer tax, Title Company document preparation, recordation fees and escrow fees of the Title Company, if any, to close escrow.
Section 3.6 Property Condition
The Property is conveyed “AS IS,” subject to Developer’s due diligence. The City warrants no knowledge of Hazardous Materials except as disclosed to Developer in writing. Post-Closing, the Developer assumes all Hazardous Materials liability, indemnifying the City per Section 9.5.
ARTICLE 4.
(NOT USED)
ARTICLE 5.
CONSTRUCTION OF IMPROVEMENTS
Section 5.1 Scope of Development
(a) The Developer shall construct the Project per Exhibit C and Exhibit E, as further refined in the approved Construction Plans. Developer shall commence construction (within 60 days of closing escrow) and achieve Certificate of Completion within 36 months of the Close of Escrow.
(b) The City shall provide City staff time to review and process all development plans and permit applications at no cost to Developer. Developer will pay City, through maintenance of a development deposit account established, the reasonable cost of thirdparty consultants required by the City and necessary for review or inspections of the Project’s permit application. The Developer is responsible for all applicable and publicly listed permit fees, unless specifically waived herein.
Section 5.2 Cost of Construction
The Developer bears all planning, design, and construction costs unless otherwise stated.
Section 5.3 Equal Opportunity
During the construction of the Improvements there shall be no discrimination on the basis of race, color, creed, religion, disability, sex, sexual orientation, marital status, national origin or ancestry in the hiring, firing, promoting or demoting of any person engaged in the construction work.
Section 5.4 Compliance with Laws
The Developer shall cause all construction work to be performed in compliance with (a) all applicable laws, ordinances, rules and regulations of federal, state, county or municipal governments or agencies now in force or that may be enacted hereafter, (b) all directions, rules and regulations of any fire marshal, health officer, building inspector, or other officer of every governmental City now having or hereafter acquiring jurisdiction. The work shall proceed only after the payment of all applicable fees, procurement of each permit, license, or other authorization that may be required by any governmental agency having jurisdiction.
Section 5.4 Prevailing Wages
(a) The Developer shall and shall cause its contractors and subcontractors to pay prevailing wages in the construction of the Development as those wages are determined pursuant to Labor Code Sections 1720 et seq., and the implementing regulations of the Department of Industrial Relations (the “DIR”), to employ apprentices as required by Labor Code Sections 1777.5 et seq., and the implementing regulations of the DIR and comply with the other applicable provisions of Labor Code Sections 1720 et seq., 1777.5 et seq., 1810-1815 and implementing regulations of the DIR.
(b) All calls for bids, bidding materials and the construction contract documents for the Development must specify that:
(i) No contractor or subcontractor may be listed on a bid proposal nor be awarded a contract for the Development unless registered with the DIR pursuant to Labor Code Section 1725.5.
(ii) The Development is subject to compliance monitoring and enforcement by the DIR.
(c) The Developer, as the “awarding body”, shall register the Development as required by Labor Code Section 1773.3 as set forth in the DIR’s online form PWC-100 within two (2) days after entering into the Construction Contract and provide evidence of such registration to the City within two (2) days of such registration and any additional registration reporting to the DIR.
(d) In accordance with Labor Code Sections 1725.5 and 1771.1, the Developer shall require that its contractors and subcontractors be registered with the DIR, and maintain such registration as required by the DIR.
(e) Pursuant to Labor Code Section 1771.4, the Development is subject to compliance monitoring and enforcement by the DIR. The Developer shall and shall require its contractors and subcontractors to submit payroll and other records electronically to the DIR pursuant to Labor Code Sections 1771.4 and 1776 et seq., or in such other format as required by the DIR.
(f) The Developer shall and shall cause its contractors and subcontractors to keep and retain such records as are necessary to determine if prevailing wages have been paid as required pursuant to Labor Code Sections 1720 et seq., and that apprentices have been employed as required by Labor Code Section 1777.5 et seq., and shall, from time to time upon the request of the City provide to the City such records and other documentation reasonably requested by the City.
(g) The Developer shall and shall cause its respective contractors and subcontractors to comply with all other applicable provisions of Labor Code, including without limitation, Labor Code Sections 1720 et seq., 1725.5, 1771, 1771.1, 1771.4, 1776, 1777.5 et seq., 1810- 1815 and implementing regulations of the DIR in connection with construction of the Development or any other work undertaken or in connection with the Property. (h) Copies of the currently applicable current per diem prevailing wages are available from the DIR website, www.dir.ca.gov. The Developer shall cause its respective contractors to post the applicable prevailing rates of per diem wages at the Development site and to post job site notices, in compliance with Title 8 California Code of Regulations 16451(d) or as otherwise as required by the DIR.
Section 5.5 Insurance Requirements
Developer shall obtain and maintain or shall cause its contractor to obtain and maintain, until the issuance of the final Certificate of Completion by City, a commercial general liability policy in the amount of Two Million Dollars ($2,000,000) per occurrence, and a comprehensive automobile liability policy in the amount of One Million Dollars ($1,000,000) per occurrence, or such other policy limits as City may reasonably approve, including contractual liability, as shall protect Developer and City from claims for such damages, and which policy shall be issued by an “A” rated insurance carrier. Such policy or policies shall be written on an occurrence form.
Developer shall also furnish or cause to be furnished to City evidence reasonably satisfactory to City that Developer and any contractor with whom it has contracted for the performance of work on the City Property or otherwise pursuant to this Agreement carries workers’ compensation insurance as required by law. Developer shall furnish a certificate of insurance countersigned by an authorized agent of the insurance carrier on a form approved by City setting forth the general provisions of the insurance coverage. This countersigned certificate shall include City and its officers, employees, agents, representatives and volunteers as additionally insured Parties under the policy, and the certificate shall be accompanied by a duly executed endorsement evidencing such additional insured status. The certificate and endorsement by the insurance carrier 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. Coverage provided hereunder by Developer shall be primary insurance and not be contributing with any 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.
Section 5.6 Construction Responsibilities
As between the City and the Developer it shall be the responsibility of the Developer to coordinate and schedule the work to be performed so that commencement and completion of the construction of the Improvements will take place in accordance with this Agreement. The Developer shall be solely responsible for all aspects of the Developer’s conduct in connection with the Development, including (but not limited to) the quality and suitability of the plans and specifications, the supervision of construction work, and the qualifications, financial condition, and performance of all architects, engineers, contractors, subcontractors, suppliers, and consultants. Any review or inspection undertaken by the City with reference to the Development is solely for the purpose of determining whether the Developer is properly discharging its obligations to the City, and should not be relied upon by the Developer or by any third parties as a warranty or representation by the City as to the quality of the design or construction of the Development.
Section 5.7 Certificate of Completion
Promptly after completion of all construction and development required by this Agreement to be completed by Developer upon the Property (the “Improvements”) in conformity with this Agreement, City shall furnish Developer with the “Certificate of Completion” upon written request by Developer. City shall not unreasonably withhold any such Certificate of Completion.
The Certificate of Completion shall be a conclusive determination of satisfactory completion of the construction required by this Agreement upon the Property and the Certificate of Completion shall so state. The Certificate of Completion shall be in such form as to permit it to be recorded in the Recorder’s Office of the County. If City refuses or fails to immediately furnish a Certificate of Completion after a written request by Developer, City shall, within ten (10) days of a written request provide Developer with a detailed written analysis, which identifies each and every reason why the City refused or failed to furnish a Certificate of Completion. The statement shall also contain City’s opinion of all the actions that Developer must undertake to obtain a Certificate of Completion. If the reason for such refusal is confined to the immediate availability of specific items of materials for landscaping, or other minor items relating to the completion of construction that are unrelated to public health and safety issues which will be determined at the sole discretion of the City, City will issue its Certificate of Completion upon the posting of a bond or other security acceptable to City in City’s reasonable discretion, in an amount representing a fair value of the work not yet completed. A Certificate of Completion shall not constitute evidence of compliance with or satisfaction of any obligation of Developer to any holder of any mortgage, or any insurer of a mortgage securing money loaned to finance the improvements, or any part thereof, nor is it evidence of compliance with laws or permits. A Certificate of Completion as set forth herein is not a notice of completion as referred to in the California Civil Code Section 3093.
Section 5.8 Inspections and Reports
The Developer shall permit City inspections and provide quarterly progress reports until full lease-up.
ARTICLE 6.
ONGOING OBLIGATIONS
Section 6.1 Use and Maintenance
(a) The Developer shall operate the Project as affordable housing per the Regulatory Agreement set out at Exhibit D for 55 years post-occupancy, maintaining it in good condition.
(b) Subject to any required approvals from the Project’s lenders and tax credit investor, the Developer shall allow the City to lease space for cellular facilities at no-cost and shall work with the City in good faith and make their best efforts to identify available locations for antennas and associated telecom equipment. City will ensure that Developer receives acceptable insurance and indemnification. The Developer shall not be responsible for installing or paying for any of the required infrastructure. (c) The Developer shall use good faith efforts to coordinate with the City to lease the commercial space on La Plaza for a community serving use and , subject to any required approvals from the Project’s lenders and tax credit investor, the City shall have the first right of refusal to match any lease offer on such commercial space, which right shall be exercised within 30 days of receiving the offer from Developer. If City does not exercise the right in such 30 day period, the right shall terminate.
Section 6.2 Nondiscrimination
No discrimination shall occur in Project operations per California Government Code §12955.
Section 6.3 Priority Housing Obligations
Developer agrees that pursuant to the City’s local preference policy, to the extent permitted by applicable law and the Project’s funding sources, to establish a priority list for the renters of the affordable housing that is built on the Property and offered for rent, which lists shall provide priority to current residents or employees working within the City of Cotati, individuals or families with children whom attend Rancho Cotati school district facilities, members of the Graton Rancheria Native American Tribe, and employees of Sonoma State University with respect to consideration of applications by such residents, employees, individuals or families, or tribal members to purchase or rent such affordable housing within the project, as applicable.
Notice of available units shall be sent to individuals on the most recent version of the City’s Housing Interest List, which shall be provided by the City upon request. Subject to the limitations of applicable law, inclusive of Federal and State Fair Housing laws and those governing Federal and State Low Income Housing Tax Credit Laws and any other applicable requirements of the Project’s funding sources which may be applicable to the development of affordable housing on the Property, the Parties agree to make best efforts to include terms in the Regulatory Agreement between City and Developer to include a preference for purchasers and renters of affordable housing offered for purchase or rent thereon.
City shall use good faith best efforts in collaboration with Developer to determine, prior to Close of Escrow, whether such preferences are permitted by applicable law and the Project’s funding sources. If determined prior to Close of Escrow to be permitted, the agreed upon preferences shall be added into the final Regulatory Agreement. In the event that, prior to Close of Escrow, City is unable to sufficiently evidence compliance with applicable laws and Project funding sources, or is unable to obtain HUD’s confirmation that the preferences comply with fair housing law, then such preferences shall not apply to the Project.
Section 6.4 Taxes and Assessments
The Developer is solely responsible for payment of all fees, assessments, taxes, charges, and levies imposed by any public authority or utility company with respect to the Property or the Development, and shall pay such charges prior to delinquency.
ARTICLE 7.
DEFAULT AND REMEDIES
Section 7.1 Default Remedies
Subject to the extensions of time provided for in Section 9.3 and Section 9.14 of this Agreement, failure by either Party to perform any action, condition, or covenant required by this Agreement within the time periods provided herein, including the events and timeframes contained in Exhibit B, Schedule of Performances, following written notice and failure to cure as described herein, constitutes a “Default” under this Agreement unless defined otherwise within this Agreement. A Party claiming a default shall give written Default Notice (the “Default Notice”) to the other Party specifying and detailing the particular default. The claimant shall not institute any proceeding against any other Party, and the other Party shall not be in default if a Party, within thirty (30) days from receipt of a Default Notice, cures such default, or if the nature of such default is that it cannot reasonably be expected to be cured within such thirty (30) day period, then the claimant shall not institute any proceeding against any other Party and the other Party shall not be in default if the Party receiving the Default Notice promptly commences to cure the default and thereafter completes such cure, correction or remedy with reasonable diligence. City hereby agrees that any cure of any default that is made or tendered by the investor limited partners or lenders of Developer shall be deemed to be a cure by Developer and shall be accepted or rejected on the same basis as if made or tendered by Developer. Upon expiration of an applicable Default Notice cure period, the non-defaulting Party may terminate this Agreement and pursue any and all remedies at law or in equity.
Section 7.2 Termination by Any Party
Prior to the Close of Escrow, any Party shall have the right to terminate this Agreement, by providing written notice to the other Parties, in the event of a failure of any Condition Precedent to the Close of Escrow as set forth in Section 3.3 (Conditions of Closing) of this Agreement, provided that such condition is for the benefit of and such failure is outside the control of the Party seeking to terminate this Agreement. Upon such termination, neither the City nor Developer shall have any further rights against or liability to the other under this Agreement, except for indemnification rights that survive termination of this Agreement.
Section 7.3 Termination by Developer
In the event Developer is not in Default under this Agreement, Developer may terminate this Agreement by written notice to City (and pursue its remedies for Default, if applicable) if any of the following events occur:
(a) City does not tender title to the City Property pursuant to the Grant Deed in the manner and condition and by the date provided in this Agreement, or (b) Developer’s Conditions Precedent are not satisfied on or before the time required by this Agreement; or
(c) Developer elects to terminate under Section 2.3 (City Property Inspection); or
(d) Default of City before the Outside Date that is not cured within the time set forth herein after written demand by Developer.
Section 7.4 Termination by City
(a) In the event City is not in Default under this Agreement, City may terminate this Agreement (subject to the notice and cure provisions set forth in Section 7.1) by written notice to Developer (and pursue its remedies for Default, if applicable, including pursuing any and all other legal remedies it may have and/or its power of termination as set forth in Section 7.5 below) in the event of a default by a Developer or failure of any Condition Precedent, including but not limited to the following:
(i) Developer fails to satisfy any Condition Precedent to the Close of Escrow within the time established therefore in this Agreement; or (ii) Developer (or any approved successor in interest) assigns or attempts to assign any of Developer’s rights in and to the City Property or any portion thereof or interest therein, or this Agreement or any portion hereof, except as permitted by this Agreement; or
(iii) There is substantial change in the ownership of Developer, or with respect to the identity of the parties in control of a Developer, or the degree thereof contrary to the provisions of Section 9.7 of this Agreement; or
(iv) There is any other material default by Developer under the terms of this Agreement which is not cured within the time provided herein. (b) After the Close of Escrow but before the issuance of the Certificate of Completion, the City shall have the right to terminate this Agreement, in the event any of the following defaults shall occur:
(i) Developer fails to commence construction of the Project as required by this Agreement and such breach is not cured within the time provided in Section 7.1 of this Agreement, provided that such Developer shall not have obtained an extension or postponement to which such Developer may be entitled pursuant to Sections 9.3 and 9.14 herein; or
(ii) Developer abandons or substantially suspends construction of the improvements, and such breach is not cured within the time provided in Section 7.1 of this Agreement, provided Developer has not obtained an extension or postponement to which such Developer may be entitled to pursuant to Sections 9.3 and 9.14 herein; or (iii) Developer assigns or attempts to assign this Agreement, or any rights herein, or transfer, or suffer any involuntary transfer of their portion of the City Property, or any part thereof, in violation of this Agreement, and such breach is not cured within the time provided in Section 7.1 of this Agreement; or
(iv) Developer otherwise materially breaches this Agreement, and such breach is not cured within the time provided in Section 7.1 of this Agreement.
Section 7.5 City Power of Termination and Right of Reverter The Parties agree that the development of the City Property for the provision of affordable housing, as provided in this Agreement and the City Regulatory Agreement, is a condition subsequent, to which the fee simple estate in the City Property granted to the Developer by the City is subject. If the Developer violates this Agreement prior to the City’s issuance of the Certificate of Completion, subject to applicable notice and cure periods, the City shall have the right, in its sole and absolute discretion, in addition to any other rights and remedies granted in this Agreement or the City Regulatory Agreement, to exercise a power of termination as described in California Civil Code Section 885.010 or in accordance to any pertinent provision within Chapter 5, Title 5, Part 2, Division 2 of the California Civil Code, to terminate and revest in the City the estate in the City Property previously conveyed to Developer pursuant to this Agreement and to re-enter and take possession of the City Property with any improvements thereon. Notwithstanding anything to the contrary contained herein, Developer’s investor limited partner (if any) shall have an additional one hundred eighty (180) days to cure any violation that triggers the City’s rights under this Section 7.5 before City shall exercise such rights. (a) Upon the City’s exercise of its power of termination, the Developer or its successors or assigns shall convey by grant deed to the City title to the City Property, as specified in the City’s notice pursuant to Section 7.4(a), and all improvements thereon, in accordance with Civil Code Section 1109, as such code section may hereafter be amended, renumbered, replaced or substituted. Such conveyance shall be duly acknowledged by the property owner and a notary in a manner suitable for recordation. The City may enforce its rights and remedies pursuant to Section 7.5 by any lawful means, including but not limited to breach of contract, injunctive relief or forfeiture of title action filed in any court of competent jurisdiction.
(b) The City shall agree to subordinate its power of termination and right of reverter to any Holder’s security interest in the City Property. (c) The City’s right of reverter shall terminate upon the City’s issuance of the Certificate of Completion. The Parties agree to execute reasonable documentation as may be appropriate to evidence such termination; provided, however, that the termination of the right of reverter shall be self-executing upon issuance of the Certificate of Completion and not be contingent on the execution of further documentation.
Section 7.6 Rights and Remedies are Cumulative
Except as otherwise expressly stated in this Agreement, the rights and remedies of the Parties are cumulative, and the exercise by either 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.
Section 7.7 Inaction Not a Waiver of Default
Any failures or delays by either Party in asserting any of its rights and remedies as to any Default shall not operate as a waiver of any Default or of any such rights or remedies, or deprive either 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.
ARTICLE 8.
SECURITY FINANCING AND THE RIGHTS OF HOLDERS
Section 8.1 Project Construction Financing; Holders of Deeds of Trust Developer shall have the right to hypothecate its interest in the Project pursuant to deeds of trust from lenders for the purpose of securing a loan or loans of funds to be used for financing the costs of the Project. Any lender of record, other than City, holding a deed of trust security such as those whose name and address shall have been provided by Developer to City shall be referred to herein as a "Holder" and collectively as "Holders."
8.2 No Encumbrances Except for Development Purposes
Notwithstanding any other provision of this Agreement, mortgages and deeds of trust, or any other reasonable method of security are permitted to be placed upon the Developer’s fee interest in the Property for the purpose of securing loans approved by the City pursuant to the approved Financing Plan. Mortgages, deeds of trust, regulatory agreements, or other reasonable security instruments securing loans approved by the City pursuant to the approved Financing Plan are each referred to as a “Security Financing Interest.” The words “mortgage” and “deed of trust” as used in this Agreement include all other appropriate modes of financing real estate acquisition, construction, and land development. The filing of a mechanics’ lien against the Property shall not constitute a default hereunder; provided, however, that Developer shall cause such lien to be discharged of record within forty-five (45) days after Developer’s receipt of written notice thereof, or, if the underlying claim is being contested in good faith, Developer may post a surety bond in accordance with applicable law while diligently contesting until final resolution.
Section 8.2 Holder Not Obligated to Construct
The holder of any Security Financing Interest authorized by this Agreement is not obligated to the provisions of this Agreement, including to construct or complete any improvements or to guarantee such construction or completion. However, nothing in this Agreement shall be deemed to permit or authorize any such holder to devote the Property or any portion thereof to any uses, or to construct any improvements thereon, other than those uses of improvements provided for or authorized by this Agreement.
Section 8.3 Notice of Default and Right to Cure
Whenever the City pursuant to its rights set forth in Article 7 of this Agreement delivers any notice or demand to the Developer with respect to the commencement, completion, or cessation of the construction of the Improvements, the City shall at the same time deliver to each holder of record of any Security Financing Interest creating a lien upon the Developer’s fee interest in the Property or any portion thereof a copy of such notice or demand. Each such holder shall (insofar as the rights of the City are concerned) have the right, but not the obligation, at its option, within ninety (90) days after the receipt of the notice, to cure or remedy or commence to cure or remedy any such default or breach affecting the Property which is subject to the lien of the Security Financing Interest held by such holder and to add the cost thereof to the security interest debt and the lien on its security interest. Each Holder shall be authorized to undertake or continue the construction or completion of the Improvements (i) as of right to the extent necessary to conserve or protect such improvements or construction already made without first having expressly assumed in writing the Developer’s obligations to the City relating to such Improvements under this Agreement pursuant to an assignment and assumption agreement prepared by the City, and (ii) after the holder agrees to complete, in the manner provided in this Agreement, the Improvements to which the lien or title of such holder relates. Any such holder properly completing such Improvements pursuant to this paragraph shall assume all rights and obligations of Developer under this Agreement.
Section 8.4 Right of City to Cure
In the event of a default or breach by the Developer of a Security Financing Interest prior to the completion of the construction of the Development, and the holder has not exercised its option to complete the construction of the Development, the City may cure the default, prior to the completion of any foreclosure. In such event the City shall be entitled to reimbursement from the Developer of all costs and expenses incurred by the City in curing the default.
Section 8.5 Modifications
If a holder of a Security Financing Interest or the Investor should, as a condition of providing financing for development of all or a portion of the Development, request any modification of this Agreement in order to protect its interests in the Development or this Agreement, the City shall consider such request in good faith consistent with the purpose and intent of this Agreement and the rights and obligations of the parties under this Agreement.
ARTICLE 9.
GENERAL PROVISIONS
Section 9.1 Notices, Demands and Communications
Formal notices, demands, and communications between the City and the Developer shall be sufficiently given if, and shall not be deemed given unless, dispatched by registered or certified mail, postage prepaid, return receipt requested, by reputable overnight delivery service, or delivered personally, to the principal office of the City and the Developer as follows:
City: City of Cotati
201 West Sierra Ave.
Cotati, CA 94931
Attn: City Manager
Developer: Freebird Development Company, LLC
1111 Broadway
Oakland, CA 94607
Attn: Robin Zimbler
Section 9.2 Non-Liability of City Officials and Employees No member, official, employee or agent of the City shall be personally liable to the Developer, or any successor in interest, in the event of any default or breach by the City or for any amount which may become due to the Developer or successor or on any obligation under the terms of this Agreement.
Section 9.3 Force Majeure Delays; Extension of Times for Performance All performance deadlines in this Agreement shall be extended to the extent of delays caused beyond the control or without the fault of the Party claiming an extension of time to perform, including, without limitation, the following: war; acts of terrorism; insurrection; strikes; lockouts; labor troubles; inability to procure materials; power failures; riots; floods; earthquakes; fires; other natural disasters; casualties; acts of God; epidemics; pandemics; quarantine restrictions; freight embargoes; lack of transportation; governmental restrictions or priority; governmental moratoria; initiation of condemnation proceedings by any governmental agency; and unreasonable acts or unreasonable failures to act of City or any other public or governmental Agency or entity (determined considering the normal processes and response times of City and such governmental entities, which shall be deemed reasonable and not force majeure delays).
Notwithstanding anything to the contrary in this Agreement, an extension of time for any such cause shall be for the period of the enforced delay only and shall commence to run from the time of the commencement of the cause, and only if notice by the Party claiming such extension is sent to the other Party within thirty (30) days after the commencement of the cause.
Section 9.4 Title of Parts and Sections
Any titles of the articles, sections or subsections of this Agreement are inserted for convenience of reference only and shall be disregarded in construing or interpreting any part of its provision.
Section 9.5 Indemnification
Developer shall indemnify, defend, and hold the City and its Council Members, members, directors, officers, employees, consultants, agents and representatives (collectively, the “Indemnitees”) harmless from and against all liability, loss, cost, claim, demand, action, suit, legal or administrative proceeding, penalty, deficiency, fine, damage and expense (including without limitation reasonable attorneys’ fees and costs) (all of the foregoing, collectively “Claims”) arising out of or in connection with this Agreement, including but not limited to the purchase of the Property and the development, construction, marketing and operation of the Development, except to the extent such claim arises from pre-existing conditions or from the gross negligence or willful misconduct of the Indemnitees’. Developer’s defense and indemnity obligations pursuant to this Section shall survive the expiration or earlier termination of this Agreement. The Developer’s indemnity obligations under this paragraph shall not apply to (a) any Contamination of the Property that occurred or first accrued during the City’s ownership of the Site, and (b) claims arising out of the City’s failure to disclose any known condition that the City is required to give to the Developer either by law or pursuant to this Agreement. City agrees to defend, indemnify, protect and hold harmless the Developer, and its officers, beneficiaries, employees, agents, attorneys, representatives, legal successors and assigns (“Developer Indemnitees”) from, regarding and against any and all liabilities, obligations (including but not limited to the duty to respond to any governmental inquiry, investigation, claim or demand regarding such Contamination), orders, decrees, judgments, liens, demands, actions, Environmental Response Actions, claims, losses, damages, fines, penalties, expenses, Environmental Response Costs or costs of any kind or nature whatsoever, together with fees (including, without limitation, reasonable attorneys’ fees and experts’ and consultants’ fees), resulting from or in connection with the fee ownership of the Property by the City, the City’s occupancy or use of such Property prior to close of escrow or the City’s performance or nonperformance under or with respect to this Agreement or the Contamination, to the extent such Contamination occurred or first accrued during the City’s ownership of the Site. If the City discovers Contamination or other materials subject to legal requirements or corrective action, the City shall immediately notify the Developer of the same.
Section 9.6 Governing Law
California law governs this Agreement.
Section 9.7 Transfers of Interest in City Property or Agreement (a) Prohibition. The qualifications and identity of Developer are very important and of particular concern to City. Because of those qualifications and identity, City has entered into this Agreement with Developer. Except as provided in Section 9.7(b) below, no voluntary or involuntary successor in interest of Developer shall, before the issuance of the Certificate of Completion, (i) acquire any rights or powers under this Agreement, or (ii) make any total or partial sale, transfer, conveyance, assignment, subdivision, refinancing or lease of the whole or any part of the City Property or Project without the prior written approval of the City Manager, in its reasonable discretion.
(b) Permitted Transfers. Notwithstanding any other provision of this Agreement to the contrary, City approval of an assignment of this Agreement or conveyance of the City Property or Project, or any part thereof, shall not be required in connection with any of the following:
(i) The granting of reasonable easements, licenses, or permits to facilitate construction of the Project.
(ii) The granting of security interests in the Project and this Agreement to a Holder for a loan for the Project, and the transfer of title by foreclosure, deed or other conveyance in lieu of foreclosure in connection with such security interest. (iii) The conveyance of any interest in the Project after the issuance of a Certificate of Completion by City.
(iv) The assignment of this Agreement or any interest in the City Property or the Project to a limited partnership provided that Developer or an affiliate thereof is the a general partner of such limited partnership;
(v) The admission of additional general partners to the Developer’s limited partnership;
(vi) The admission of limited partners to the Developer’s limited partnership in connection with tax credit financing, and any subsequent transfer of such limited partnership interests, including any transfer of stock or equity in the limited partners that does not change management or operational control of the Project, with no material change in beneficial ownership (with the exception of any conveyance to member(s) of the immediate family(ies) of the transferor(s) or trusts for their benefit) and which constitutes a tax-free transaction under Federal income tax law and California real estate transfer tax; (vii) The removal for cause of any general partner in the Developer by a limited partner of the Developer, and the replacement thereof. (viii) The lease for occupancy of all or any part of the Project in accordance with this Agreement and the City Regulatory Agreement. (c) Binding on Successors. Any reference in this Agreement to a specifically named Party shall be deemed to apply to any successor, heir, administrator, executor or assign of such party who has acquired an interest in compliance with the terms of this Agreement, or under law. The covenants and restrictions set forth in this Agreement shall run with the land and shall bind all successors in title to the Property. However, on the termination of this Agreement, such covenants and restrictions shall expire.
Section 9.8 No Brokers
Each Party represents to the other that it has not had any contact or dealings regarding the Property, or any communication in connection with the subject matter of this transaction, through any real estate broker or other person who can claim a right to a commission or finder’s fee. If any broker or finder makes a claim for a commission or finder’s fee based upon a contact, dealings, or communications, the Party through whom the broker or finder makes this claim shall indemnify, defend with counsel of the indemnified Party’s choice, and hold the indemnified Party harmless from all expense, loss, damage and claims, including the indemnified Party’s attorneys’ fees, if necessary, arising out of the broker’s or finder’s claim. The provisions of this section shall survive expiration of the Term or other termination of this Agreement, and shall remain in full force and effect.
Section 9.9 Severability
If any term, provision, covenant or condition of this Agreement is held by a court of competent jurisdiction to be invalid, void or unenforceable, the remainder of the provisions shall continue in full force and effect unless the rights and obligations of the Parties have been materially altered or abridged by such invalidation, voiding or unenforceability.
Section 9.10 Parties not Co-Venturers
Nothing in this Agreement is intended to or does establish the Parties as partners, co-venturers, or principal and agent with one another.
Section 9.11 Actions by the City
Except as may be otherwise specifically provided in this Agreement, whenever any approval, notice, direction, finding, consent, request, waiver, or other action by the City is required or permitted under this Agreement, such action may be given, made, or taken by the City Manager, or by any person who shall have been designated in writing to the Developer by the City, without further approval by the Council Members. Any such action shall be in writing. The Developer acknowledges that nothing in this Agreement (including any approval by the City Manager in accordance with this Agreement) shall limit, waive, or otherwise impair the authority and discretion of: (i) the City’s Planning Department, in connection with the review and approval of the proposed construction plans for the Development (or any change to such plans), or any use, or proposed use, of the Property, (ii) the City’s issuance of a building permit, or (iii) any other office or department of the City acting in its capacity as a governmental regulatory authority with jurisdiction over the development, use, or operation of the Development.
Section 9.12 City’s Warranty of Good Standing and Authority The City represents and warrants to the Developer that (i) this Agreement has been duly entered into and is the legally binding obligation of the City, (ii) this Agreement will not violate any judgment, law, consent decree, or agreement to which the City is a party or is subject to and will not violate any law or ordinance under which the City is organized, and (iii) there is no claim pending, or to the best knowledge of the City, threatened, that would impede the City’s ability to perform its obligation hereunder.
Section 9.13 Representations and Warranties of the Developer The Developer hereby represents and warrants to the City as follows:
(a) Organization. The Developer is a duly organized limited liability company, validly existing, and in good standing under the laws of the State of California and has the power and authority to own its property and carry on its business as now being conducted. (b) Authority of Developer. The Developer has full power and authority to execute and deliver this Agreement, and the other City Documents to be executed and delivered pursuant to this Agreement, and to perform and observe the terms and provisions of all of the above. (c) Authority of Persons Executing Documents. This Agreement and all other documents or instruments executed and delivered, or to be executed and delivered, pursuant to this Agreement have been executed and delivered by persons who are duly authorized to execute and deliver the same for and on behalf of the Developer. (d) No Conflict. To the best of the Developer’s knowledge, the Developer’s execution, delivery and performance of its obligations under this Agreement will not constitute a default or a breach under any contract, agreement or order to which the Developer is a party or by which it is bound.
Section 9.14 Operating Memoranda and Implementation Agreements The Parties acknowledge that the provisions of this Agreement require a close degree of cooperation and that new information and future events may demonstrate that changes are appropriate with respect to the details of performance of the Parties under this Agreement. The Parties desire, therefore, to retain a certain degree of flexibility with respect to the details of performance for those items covered in general terms under this Agreement. If and when, from time to time, the Parties find that refinements or adjustments are desirable, such refinements or adjustments shall be accomplished through operating memoranda or implementation agreements approved by the Parties which, after execution shall be attached to this Agreement as addenda and become a part hereof.
Operating memoranda or implementation agreements may be executed on the City’s behalf by the City Manager, or his or her designee. In the event a particular subject requires notice or hearing, such notice or hearing shall be appropriately given. Any significant modification to the terms of performance under this Agreement shall be processed as an amendment of this Agreement in accordance with Section 9.15 and must be approved by the Council Members in accordance with applicable law.
Section 9.15 Amendments
The Parties can amend this Agreement only by means of a writing signed by both Parties, following approval by the Council Members, in accordance with applicable law.
Section 9.16 Multiple Originals; Counterparts
This Agreement may be executed in multiple originals, each of which is deemed to be an original, and may be signed in counterparts.
Section 9.17 Attorney’s Fees
In any action between the Parties to interpret, enforce, reform, modify, rescind or that otherwise relates to any of the terms or provisions of this Agreement, the prevailing Party in the action shall be entitled, in addition to damages, injunctive relief or any other relief to which it might be entitled, and reasonable attorneys’ fees.
Section 9.18 Legal Advice
Each Party represents and warrants to the other the following: they have carefully read this Agreement, and in signing this Agreement, they do so with full knowledge of any right which they may have; they have received independent legal advice from their respective legal counsel as to the matters set forth in this Agreement, or have knowingly chosen not to consult legal counsel as to the matters set forth in this Agreement; and, they have freely signed this Agreement without any reliance upon any agreement, promise, statement or representation by or on behalf of the other Party, or their respective agents, employees or attorneys, except as specifically set forth in this Agreement, and without duress or coercion, whether economic or otherwise.
Section 9.19 Time of Essence
Time is of the essence with respect to the performance by City and Developer of each and every obligation and condition of this Agreement in which time is a factor.
Section 9.20 Cooperation
Each Party agrees to cooperate with the other in this transaction and, in that regard, to sign any and all documents which may be reasonably necessary, helpful or appropriate to carry out the purposes and intent of this Agreement including, but not limited to, releases or additional agreements.
Section 9.21 Conflicts of InterestDeveloper acknowledges that no officer or employee of City has or shall have any direct or indirect financial interest in this Agreement nor shall Developer enter into any agreement of any kind with any such officer or employee during the term of this Agreement and for one year thereafter. Developer warrants that Developer has not paid or given, and will not pay or give, any third party any money or other consideration in exchange for obtaining this Agreement.
Section 9.22 Entire Agreement
This Agreement contains the entire understanding between the Parties relating to the transaction contemplated by this Agreement. All prior or contemporaneous agreements, understandings, representations and statements, oral or written, are merged in this Agreement and shall be of no further force or effect. This Agreement supersedes the ENRA, and such ENRA shall have no further force or effect. Each Party is entering this Agreement based solely upon the representations set forth herein and upon each Party’s own independent investigation of any and all facts such Party deems material. This Agreement includes all Attachments, which are incorporated herein and together with the Agreement constitute the entire understanding and agreement of the Parties.
[Signature Page Follows.]
IN WITNESS WHEREOF, the City and the Developer have executed this Agreement as of the Effective Date.
CITY:
CITY OF COTATI,
a California municipal corporation
By: __________________________
Name: Damien O’Bid
Title: City Manager
DEVELOPER:
FREEBIRD DEVELOPMENT COMPANY, LLC,
A California limited liability company
By: __________________________
Name: Robin Zimbler
Title: Member and Manager