LOAN AGREEMENT BETWEEN SUNNYVALE COMMUNITY SERVICES

AND THE CITY OF SUNNYVALE

This Agreement, for reference dated July 16, 2002 is by and between Sunnyvale Community Services (SCS) and the City of Sunnyvale (City).

Whereas, SCS currently occupies approximately 3,700 sq. ft. of donated office space at the Sunnyvale Senior Center and has for over 20 years; and

Whereas, when the new Sunnyvale Senior Center opens it will not be feasible to continue to combine SCS with the Senior Center activities; and

Whereas, in addition to the office space at the Senior Center, SCS has stored food and supplies for 8 years in an empty store donated by the Sunnyvale TownCenter, which center is also undergoing a change of ownership and remodeling; and

Whereas, SCS needs a facility to house both its offices and its food storage; and

Whereas, a local corporation has donated a 3.26 acre parcel located at 1165 East Arques to SCS for the agency to sell and use the proceeds to acquire a suitable building, but for various reasons will finalize the donation on the day the land is sold; and

Whereas, because SCS does not currently hold title to the land to be donated it cannot borrow against it and SCS does not have cash to complete the transaction until the donated property is sold; and

Whereas, the City is willing to provide interim cash to effect a purchase of a suitable property until the donated land is sold;

NOW, THEREFORE, THE PARTIES HEREBY AGREE AS FOLLOWS:

1. City will:

a. Loan up to $2.5 million dollars for the purchase of a property to be used by SCS for office and food storage, contingent on receipt of a written agreement between SCS and the donor corporation for the transfer of the property.

b. Apply an interest rate equivalent to the earning rate on City funds in effect at the time the loan is made, as computed monthly by the Finance Department, compounded monthly, which amount may be deferred until the end of the loan term.

c. Allow SCS two years to repay the loan, with the time clock starting on the date the money is actually transferred by City to SCS, or to an escrow on behalf of SCS.

d. Obtain a First Deed of Trust on the property acquired.

2. SCS will:

a. Find a property of approximately 10,000 to 12,000 sq. feet, located in Sunnyvale, near public transportation to use for its operations and food storage.

b. Put down $400,000 against the purchase price, which amount it has through a CDBG grant.

c. Repay the loan, and pay the interest rate established in accord with 1.b. above, no later than 2 years after the money is transferred. There is an option to prepay without penalty. SCS acknowledges and agrees that this two year-term for repayment of loan and payment of interest is not subject to extension by future negotiations.

d. Provide a First Deed of Trust on the property acquired to the City.

3. The City representatives on the transaction are Robert S. LaSala, City Manager, and Mary Bradley, Finance Director.

4. The SCS representatives on the transaction are Nancy Tivol, Executive Director, and Leslie Lawton, Board President. Volunteer Project Manager for SCS is Jane Vaughn. Realtors for SCS are Jeff Houston and Steve Horton.

In Witness Whereof, the Parties have executed this Agreement.

Return to RTC# 02-278