Reso13 PC 13-14 2879 Planning Commission Recommending Approval of DDA for 950 Middlefield Road

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City Dr�ft 6128I13 6.2 No Prohibited Encumbrances. The Developer sha11 not record or allow to be recarded against all or any portion af the Site or the Project an�� mortgage, deed of txust, encumbrance or lien that is a Prohibited Encumbrance. The Developer sha11 remove or cause to ba removed any Prohibited Encumbrance made or recorded against a11 or any portion of the Site or the Project or sha11 assure the complete satisfaction of any such Prohibited Encumbrance to the satisfaction of the City. The covenants of the Developer set forth in this Section 6.2 regarding the placement af encumbrances against the Project or the 5ite shall run with the land and bind successive owners of the Site, until issuance of a Certificate of Completion for the Project, whereupon such obligations shall terminate. Any encumbrance not specifically approved by the City prior to the issuance of a Certificate of Completion shall be deemed a Prohibited Enciunbrance. G.3 City Right to Discharge Prohibited Encumbrances. After sixty (60} calendar days prior written Notice to the Developer, and provided that the Developer has not satisfied or removed the subject Prohibited Encumbrance (or is the subject Prohibited Encumbrance is not susceptible of satisfaction or rernoval within such s'v�ty-day period, the Developer fails to commence the satisfaction or removal of the subject Prohibited Encurnbrance within such period and thereafter to prosecute diligently to completion}, the City shaJl have the right, but not the obligation, to satisfy or remove any Prohibited Encumbrance against the Site or the Project and receive reimbursement from the Developer for any amounts paid or incuired in satisfying or removing any such Prohzbi�ed Encumbrance, upon demand. Any amount expended by the City to satisfy or remove any Pro�ibited Encurnbrance that is not reimbursed ta the City by the Developer within thirty (30) calendar days after written demand to the Developer for such reimbursement, shall accrue interest from the date such expense was'incurred by the City at the lesser o£ (i) the rate of ten percent (10%) per annum; or (ii} the Usury Limit, un�il paid in full. The covenants of the Developer set forth in this Section 6.3 shall run with the land and bind successive owners af the Site, until issuance of a Certificate of Completion for the Project, whereupon such rights and obligations shall automatically terminate. G.4 Developer Right to Co�.test Validi#y of Encumbrance. Developer may contest the validity of any Prohibited Encumbrance, and nothzng in this Agreement shall require the Developer to pay or make provision for the payment of any taac, assessment, lien or charge associated with such Prohibited Encumbrance so long as Developer in good faith sha11 cantest the validity or amount therein and so long as such delay in payment shall not subject the Site or the Project(or any por#ion thereo fl to forfeiture or sale. 6.5 Rights of Lenders and City Regarding Permitted Encnmbrances. 6.5.1 No E_ffect on Rights or Rernedies. Any Perrnitted Encumbrance sha11 not affect, limit or restrict the City's rights or remedies under this Agreement, except as expressly pravided in this Agreernent. Nothing contained in any Permitted Encumbrance sha11 bind the City or impose any obliga�ion on the City. City sha11 reasonably cooperate with Developer and Lender(s), if applicable. City acl�owledges that financing may be critical to Developer, and City shall not unreasonably withhold cansent to Lender's requir�ments, including but not limited to approval of subordination agreements consistent with current industry practice. 82483.0000917571312,10 43