INDEMNIFICATION AND DEVELOPMENT AGREEMENT BY AND

AMONG THE EAST PALO ALTO SANITARY DISTRICT, THE CITY OF

EAST PALO ALTO, AND [EDEN HOUSING, INC.]

This Indemnification and Development Agreement (the “Agreement”), is made and entered into
on __________________ (the “Effective Date”), by and among the CITY OF EAST PALO
ALTO, a general law city of the State of California (the “City”), the EAST PALO ALTO
SANITARY DISTRICT, a California sanitary district organized under the laws of the State of
California (the “District”), and [EDEN HOUSING, INC., a ________] (the “Developer”)
(individually, a “Party”, collectively, the “Parties”).

RECITALS

A. The District provides wastewater service to property within its service area.

B. Developer is the owner of certain property within the District’s service area located at 1805
East Bayshore Road, East Palo Alto, CA 94303, and is proposing to develop a 185-unit
affordable housing project (the “Development”).

C. As part of the Development process, and in order to obtain financing for the Development,
Developer and the City have requested that the District issue a will-serve letter to Developer
promising to provide wastewater service to the Development in the future (the “Letter”).

D. The District’s system does not currently have capacity to provide service to the
Development, and the District is working with Developer and other developers of property
within the District’s service area to expand the system and create sufficient capacity to provide
service to Developer and other developers.

E. Developer will be required to contribute its fair share of system expansion, either through
paying a proportionate share of the cost of system expansion to reimburse the District or other
developer(s) that have paid for the costs of system expansion, or through paying for the cost of
system expansion and seeking reimbursement from other developers in the future as provided in
the Letter. The Letter will also provide that the District’s provision of wastewater service to
serve the Development will be conditioned on expansion of the wastewater system and creation
of sufficient capacity to serve the Development. The purpose of issuing the Letter at this time is
to assist the Developer with obtaining necessary financing for the Development.
A. The District’s ordinary. capacity and connection fees (“Capacity Fees”) will be applicable to
the Development and units therein. Additionally, Developer will be required to pay for fifty
percent (50%) of the cost of expanding the District’s wastewater system in an amount necessary
to accommodate the development (“System Expansion Improvements”), in an amount not to
exceed 50% of the total cost of expanding the system to accommodate the
development$____________ (the “System Expansion Payment”). The System Expansion
Improvements are listed in detail on Exhibit “A” hereto.

B. The Letter will also provide that the District’s provision of wastewater service to serve the
Development will be conditioned on completion of the System Expansion Improvements. The
Letter is issued to facilitate Developer’s financing for the Development.

-1-
82091.00001\32957933.2
82091.00001\32957933.232957933.4
C. The Parties wish to ensure that the District is indemnified, protected, and held harmless from
any claim arising out of issuing the Letter, in consideration for granting the same.

AGREEMENT

1. RECITALS. The Recitals set forth above are true and correct, and by this
reference incorporated herein.

1. PAYMENT OF FEES AND CHARGES . Developer shall be responsible for all

fees and charges applicable to the Development or any unit therein, including the Capacity Fees,
which are due at the time the Development or any unit therein applies for a connection to the
District’s wastewater system, or at such other time as required by the District.

Additionally, Developer shall pay the System Expansion Payment in an amount

not to exceed $_50% of the total cost of system improvement to accommodate the
project_________________, with such final amount to be determined by the District upon
__________. The System Expansion Payment shall be due [WHEN DOES THE DISTRICT
REQUIRE THIS PAYMENT?]. The System Expansion Payment is required in addition to, and
not in lieu of, any applicable Capacity Fees or other fees or charges imposed by the District when
such Capacity Fees or other fees or charges may become due.

2. CONNECTION TO DISTRICT’S WASTEWATER SYSTEM . The Letter shall

be conditioned on completion of the System Expansion Improvements. The District shall have no
obligation to commence or complete construction of the System Expansion Improvements until
payment by Developer of the System Expansion Payment in full. Developer further understands
and acknowledges that the District shall have no obligation, and shall in no way be required, to
connect or allow Developer to connect the Development (or any unit therein) to the District’s
wastewater system until the System Expansion Improvements have been completed (as
determined by the District Engineer), and the System Expansion Payment has been paid in full.
Nothing contained herein shall be interpreted to require the District to provide wastewater
service to the Development, or any unit therein, until such conditions have been satisfied.

3. INDEMNIFICATION. To the fullest extent permitted by law, Developer and

City, at their own expense, shall defend, indemnify and hold harmless the District, its agents,
officers, officials, and employees from and against any and all claims, demands, actions, causes
of action, suits, proceedings, costs, expenses, liabilities, judgments, awards, decrees, settlements,
loss, damage or injury of any kind, in law or equity (collectively, “Claims”) brought against the
District, its agents, officers, officials, and employees, that arise out of, pertain to, or are incident
to the issuance of the Letter including, without limitation the payment of all consequential
damages, expert witness fees, and attorneys’ fees and other related costs and expenses
(“Indemnification Obligation”). The Indemnification Obligation will not require that City or
Developer to indemnify the District for District’s willful misconduct. The City and the
Developer’s obligation to indemnify shall not be restricted to insurance proceeds, if any,
received by the District, its agents, officers, officials, and employees.

-2-
82091.00001\32957933.2
82091.00001\32957933.232957933.4
 4. INTERIOR PLUMBING; SIZING. It is Developer’s responsibility to see that
lateral sewer pipes, building sewer pipes and all fixture units within the Development are of
sufficient capacity. District shall have no responsibility to inspect the installation of building
sewer pipes or of the interior plumbing fixtures or piping of any building.

5. REPRESENTATION AND PAYMENT FOR LEGAL SERVICES RENDERED .

The District shall have the absolute right to retain the District’s General Counsel or separate
legal counsel in any and all matters related to any Claim. Developer and/or City shall pay the
attorneys’ fees and costs of the legal firm retained by District to represent the District in such
Claim. Failure by Developer and/or City to pay such attorneys’ fees and costs within thirty (30)
days after receipt of notice and invoice from District may be treated as a default of Developer
and City’s obligations under this Agreement.

6. DEFENSE COOPERATION. The City and Developer shall reasonably cooperate

in all aspects of the litigation contemplated herein.

7. NOTIFICATION OF CLAIM. The District shall promptly notify all Parties of

any Claim. For all purposes herein, notices shall be effective when delivered via electronic mail,
personally delivered, delivered by commercial overnight delivery service, or sent by certified or
registered mail, return receipt requested, to the appropriate address set forth below:

DISTRICT: DEVELOPER:
East Palo Alto Sanitary District _________.
Attn: General Manager Attn: [INSERT]
901 Weeks Street ______________
East Palo Alto, CA 94303 ______________, CA _____
Email: aokupe@epasd.com Email: _____________

CITY:
City of East Palo Alto
Attn: ___________
2415 University Avenue, 2nd Floor
East Palo Alto, CA 94303
Email:______________

8. DEFAULT AND TERMINATION. This Agreement is not subject to

termination, except by mutual agreement or as otherwise provided herein. In the event of a
default of City or Developer’s obligations under this Agreement, the District shall provide
written notification to all Parties of such alleged default and either City or Developer shall have
fourteen (14) calendar days after receipt of written notification to cure any such alleged default.
If neither City nor Developer cure such alleged default within the specified time period or
otherwise reach agreement with the District on a resolution of the alleged default, both City and
Developer shall remain responsible for any costs and attorney’s fees awarded by the Court or as
a result of settlement and other expenses incurred by the District related to any Claim, including
litigation or settlement related thereto.

-3-
82091.00001\32957933.2
82091.00001\32957933.232957933.4
 9. EXCLUSIVE REMEDY. The Parties acknowledge that none of the Parties
would have entered into this Agreement if it were to be liable in damages under or with respect
to all or any part of this Agreement. Accordingly, no Party shall sue the other for damages or
monetary relief for any matter related to this Agreement. The Parties’ litigation remedies shall be
limited to declaratory and injunctive relief, mandate, and specific performance. For purposes of
this Agreement, the term “specific performance” shall include, without limitation, payment of all
Indemnification Obligations pursuant to the provisions set forth in this Agreement.

10. FAIR SHARE CONTRIBUTION FOR SYSTEM EXPANSION . Nothing in this

Agreement shall be construed to limit, direct, impede or influence the determination of
Developer’s fair share of the cost of expanding the District’s system to satisfy the conditions set
forth in the Letter.

11. COMPLETE AGREEMENT AND GOVERNING LAW. This Agreement

represents the complete understanding between the parties with respect to matters set forth
herein. This Agreement shall be construed in accordance with the laws of the State of California.

12. SUCCESSORS AND ASSIGNS. The obligations specific herein shall be made,
and are binding on the successors in interest of the Developer and City, whether the succession is
by agreement, by operation of law or by any other means.

13. AMENDMENT AND WAIVER. No modification, waiver, amendment or

discharge of this Agreement shall be valid unless the same is in writing and signed by all parties.

14. SEVERABILITY. If any term, provision, covenant or condition of this

Agreement is held to be invalid, void or otherwise unenforceable, to any extent, by any court of
competent jurisdiction, the remainder of this Agreement shall not be affected thereby, and each
term, provision, covenant or condition of this Agreement shall be valid and enforceable to the
fullest extent permitted by law.

15. SURVIVAL. The Parties agree that this Agreement shall constitute a separate
agreement from any other conditions set forth in the Letter, and if the Letter in part or in whole,
is invalidated, rendered null or set aside by a court of competent jurisdiction, the Parties agree to
be bound by the terms of this Agreement, which shall survive such invalidation, nullification or
setting aside.

16. INTERPRETATION. The parties have been advised by their respective

attorneys, or if not represented by an attorney, represent that they had an opportunity to be so
represented in the review of this Agreement. Any rule of construction to the effect that
ambiguities are to be resolved against the drafting party shall not be applied in interpreting this
Agreement.

17. CAPTIONS AND HEADINGS. The captions and section headings used in this
Agreement are inserted for convenience of reference only and are not intended to define, limit or
affect the construction or interpretation of any term or provision hereof.

18. JURISDICTION AND VENUE. Any action at law or in equity arising under this
Agreement or brought by a party hereto for the purpose of enforcing, construing or determining

-4-
82091.00001\32957933.2
82091.00001\32957933.232957933.4
the validity of any provision of this Agreement shall be filed in the Courts of San Mateo, State of
California, and the parties hereto waive all provisions of law providing for the filing, removal or
change of venue to any other court or jurisdiction.

19. COUNTERPARTS, FACSIMILE AND ELECTRONIC EXECUTION . 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 document. To facilitate
execution of this Agreement, the parties may execute and exchange facsimile or electronic
counterparts, and facsimile or electronic counterparts shall serve as originals.

20. JOINT AND SEVERAL LIABILITY. The City and Developer shall be jointly
and severally liable with respect to the obligations established by this Agreement. The District
may look individually to the City or Developer for satisfaction of the obligations set forth herein.
Any dispute between Developer and the City as to the obligations created by this Agreement
shall not provide justification for any delay in meeting the requirements of this Agreement.

21. REVISION OF AGREEMENT. This Agreement may, from time to time, be

amended, revised, or supplemented by and with the consent of the parties hereto and subject to
the approval and ratification of their respective governing bodies.

[SIGNATURES ON FOLLOWING PAGE]

-5-
82091.00001\32957933.2
82091.00001\32957933.232957933.4
IN WITNESS WHEREOF, the Parties have by their duly authorized representatives executed
this Agreement, among the East Palo Alto Sanitary District, the City of East Palo Alto, and
[Eden Housing, Inc.], as of the date first written above.

ATTEST: EAST PALO ALTO SANITARY

DISTRICT

__________________________________
Secretary By: __________________________

Name:

APPROVED AS TO FORM: Title:

__________________________________
General Counsel

ATTEST: CITY OF EAST PALO ALTO

__________________________________ By: __________________________

City Clerk
Name:

Title:
APPROVED AS TO FORM:

__________________________________
City Attorney

[EDEN HOUSING, INC.], a ____________

By: __________________________

Name:

Title:

-6-
82091.00001\32957933.2
82091.00001\32957933.232957933.4
 Exhibit “A”
Description of System Expansion Improvements

- Exhibit “A” -
82091.00001\32957933.2
82091.00001\32957933.4
 Summary report:
Litéra® Change-Pro 7.5.0.135 Document comparison done on 5/19/2020
10:08:05 PM
Style name: Default Style
Intelligent Table Comparison: Active
Original DMS:iw://iManage/iManage/32957933/2
Modified DMS: iw://iManage/iManage/32957933/4
Changes:
Add 46
Delete 23
Move From 0
Move To 0
Table Insert 0
Table Delete 0
Table moves to 0
Table moves from 0
Embedded Graphics (Visio, ChemDraw, Images etc.) 0
Embedded Excel 0
Format changes 0
Total Changes: 69