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HomeMy WebLinkAbout16 AGREEMENT TO EXCHANGE ARMY RESERVE PARCELAgenda Item 16 Reviewed: AGENDA REPORT City Manager Finance Director N/A MEETING DATE: November 1, 2011 TO: WILLIAM A. HUSTON, INTERIM CITY MANAGER FROM: REDEVELOPMENT AGENCY SUBJECT: AGREEMENT PERTAINING TO EXCHANGE OF ARMY RESERVE PARCEL FOR ALTERNATIVE PARCEL SUMMARY The Department of the Army represented by the Army Corps of Engineers has contacted the City regarding a potential land exchange of the Tustin Army Reserve Center for another 14-15 acre parcel. The Army has statutory federal authority to enter into a land exchange with the City. The City is interested in pursuing such an exchange to support the developer of The District at Tustin Legacy which desires to expand its retail shopping center, including facilitating additional parking and circulation subject to no costs of such a transaction being borne by the City. RECOMMENDATION It is recommended that the City Council: 1. Authorize the City Manager or Assistant City Manager to execute the attached Agreement Respecting Exchange of the Army Reserve Parcel for Alternative Parcel between the City and Vestar/Kimco, L.P. (Exchange Agreement), and grant authority prior to execution to make minor modifications to the Agreement as may be determined necessary, recommended and approved the City's special real estate counsel, Armbruster, Goldsmith & Delvac based on final negotiations with the Developer, including inserting applicable time frames for any site selection process to be concluded provided that such modifications do not result in any costs.of the Army transaction being borne by the City. 2. Authorize the City Manager or Assistant City Manager to take all actions necessary and desirable to implement the Agreement including the execution of all related documents and instruments necessary to either enter into an option or purchase agreement for the Army land exchange parcel. Agenda Report Agreement Representing Exchange of Army Reserve Parcel for Alternative Parcel November 1, 2011 Page 2 FISCAL IMPACT There is no fiscal impact associated with this Agenda Item other than the staff time and consultant support necessary for negotiation of any potential exchange with the Department of the Army; however, the Exchange Agreement includes provisions which provide for developer's reimbursement to the City for all incurred City expenses. BACKGROUND The Department of the Army ("Army"), represented by the Army Corps of Engineers, has approached the City about a proposed exchange of the current Tustin Army Reserve Center for another 14-15 acre vacant property to be identified by the Army which it proposes the City acquire and ultimately convey to the Army. The Tustin Army Reserve Center is currently located at 2345 Barranca Parkway adjacent to The District at Tustin Legacy. The Secretary of Defense has the authority to delegate to the Army his authority under Section 18240 to make such exchanges. The City has been working with the Army over the last few months to identify potential alternative land exchange parcels which might be acceptable to the Army. As the City Council is aware, the City and Vestar/Kimco Tustin, LP ("Developer") entered into the Tustin Legacy Disposition and Development Agreement (Retail Development) dated as of March 25, 2005, which has been subsequently amended on five occasions (collectively, the "DDA"). Pursuant to the DDA, Developer has been performing its obligations, including construction of a retail lifestyle center and associated improvements and required infrastructure. Developer has been working in coordination with City staff for some time to support a potential land exchange with the Army in order that Developer may expand its footprint of The District in order to facilitate additional retail development, parking and circulation improvements for The District. In conjunction with the City's discussion with the Developer, the City has communicated its position to Developer that the City's interest in acquisition of an alternative exchange parcel for the Army is based solely on Developer's current and continuing interest in the current Tustin Army Reserve property. Without the City being backstopped completely by the Developer for any costs and expenses associated with such a land exchange, the City would not entertain negotiations at this time with the Army. The Army on Friday, October 21, 2011 informed the City that it appears to be approaching a final decision on what might be an acceptable Army land exchange parcel based on a recommendation to them by Developer's representatives. While there might still be new sites identified, the current site that the Army seems to be focusing on is located at 1180 N. Miller Avenue within the City of Anaheim. Appropriately, the Agenda Report Agreement Representing Exchange of Army Reserve Parcel for Alternative Parcel November 1, 2011 Page 3 Army's timing as dictated by headquarters may necessitate in the near future execution of an Agreement between the City and Developer so that the subject land exchange parcel can at least be held off the market until further decisions are made by either the Army or Developer. Appropriately, an Agreement has been prepared between the City and Developer to provide a mechanism for entering into an option or purchase agreement for acquisition by the City of any alternative exchange parcel that might be determined acceptable to the Army and Developer, exchange of such parcel (if acquired for the Army Reserve parcel), and the sale by the City to Developer of the Army Reserve Parcel pursuant to certain terms and conditions. The City's special military counsel Kutak Rock in Washington, DC, George Schlossberg, has reviewed a draft agreement prepared by the Developer and provided input to the City's special real estate counsel, Amy Freilich with Armbruster, Goldsmith & Delvac. Ms. Freilich has significantly reworked the document and prepared what staff now believes is an acceptable agreement to ensure that a process is established for backstopping the City for any incurred expenses in any potential option or acquisition of a potential acceptable Army land exchange parcel for the current Tustin Army Reserve Center. A copy of the Agreement is attached for City Council consideration. Given timing considerations, the Assistant City Manager would request authority to make minor modifications to the Agreement as may be recommended and approved by the City's special real estate counsel in our final negotiations with the Developer, including inserting applicable time frames for any site selection process to be concluded, provided that such modifications do not result in any costs of the Army transaction being borne by the City. Additionally, staff requests that the City Council authorize the Assistant City Manager to execute the Agreement and take all actions necessary and desirable to implement the Agreement including the execution of all related documents and instruments necessary to either enter into an option or purchase agreement for the Army land exchange parcel. If a final site is agreed to by the Army, both an Exchange Agreement between the City and Army and a DDA Amendment between the City and Developer will be brought back to the City Council for future approvals. ~~~ ~, Christine Shingleton Assistant City Manager Attachment: Agreement Respecting Exchange of the Army Reserve Parcel For Alternative Parcel Attachment Agreement Pertaining To Exchange of the Army Reserve Parcel for Alternative Parcel AGREEMENT PERTAINING TO EXCHANGE OF THE ARMY RESERVE PARCEL FOR ALTERNATIVE PARCEL This Agreement Pertaining to Exchange of the Army Reserve Pazcel for Alternative Pazcel (the "Agreement") is entered into as of this day of 2011 (the "Effective Date") by and between the City of Tustin (as more fully defined in Section 1.4.1 of the DDA (defined below), the "City") and Vestar/Kimco Tustin, L.P., a California limited partnership (as defined in Section 1.4.2 of the DDA, "Developer"). City and Developer are sometimes referred herein individually as a "Party" and collectively as the "Parties." RECITALS: A. City and the Developer entered into that certain Tustin Legacy Disposition and Development Agreement (Retail Development) dated as of July 20, 2004, as amended by that certain First Amendment to Tustin Legacy Disposition and Development Agreement (Retail Development) dated as of Mazch 25, 2005, that certain Second Amendment to the Tustin Legacy Disposition and Development Agreement (Retail Development) dated as of June 8, 2005 (as disclosed by a Memorandum thereof recorded June 10, 2005 as Instrument No. 2005000446772 of Official Records), that certain Third Amendment to the Tustin Legacy Disposition and Development Agreement (Retail Development) dated as of November 3, 2006 (as disclosed by a Memorandum thereof recorded November 3, 2006 as Instrument No. 2006000744972 of Official Records), that certain Fourth Amendment to the Tustin Legacy Disposition and Development Agreement (Retail Development) dated as of November 9, 2007 (as disclosed by a Memorandum thereof recorded November 9, 2007 as Instrument No. 2007000678615 of Official Records), and that certain Fifth Amendment to the Tustin Legacy Disposition and Development Agreement (Retail Development) dated as of October 19, 2010 (as disclosed by a Memorandum thereof recorded October 26, 2010 as Instrument No. 2010000563583 of Official Records) (collectively, the "DDA"). B. As part of its performance under the DDA, Developer has constructed The District of Tustin Legacy ("The District"), a retail lifestyle and entertainment center, and associated improvements. C. Developer desires to expand the footprint of The District in order to expand its retail development and pazking and the City desires, at Developer's sole cost and expense, to accommodate this expansion in order to facilitate additional retail development within the City. D. The United States of America, represented by the Secretary of the Army (the "Army") is the owner of certain real property adjacent to The District located at 2345 Barranca Parkway comprised of approximately 15.5 acres of land, and subject to an easement in favor of the City across an 80-foot wide strip of land abutting Barranca Pazkway for public right-of--way and utility purposes, as further described on Exhibit "A" attached (the "Army Reserve Pazcel.") The Army Reserve Pazcel is currently used by the United States Army as an Army Forces Reserve Center. Tustin/Vestaz Army Exchange Agt. October 24, 2011 E. Under existing federal regulation, the Army may exchange the Army Reserve Parcel for other property owned or to be owned by the City. F. The City and Developer desire to cooperate in (a) acquisition by the City of certain property referred to herein as the Alternative Parcel for purposes of facilitating the exchange described by this Agreement, (b) exchange of such property, if acquired, for the Army Reserve Parcel and (c) the sale by City to Developer of the Army Reserve Parcel pursuant to the following terms and conditions (the "Exchange"). AGREEMENTS: NOW, THEREFORE, in consideration of the foregoing Recitals, which are hereby incorporated in the operative provisions of this Agreement by this reference and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the Parties further agree as follows: 1. Exchange Transactions Overview. Subject to the right of either Party to terminate this Agreement as set forth below, the Parties shall use commercially reasonable efforts to accomplish the Exchange through a series of transactions (collectively, the "Exchange Transactions") in accordance with the following and the provisions of Sections 2 through 10 below: (a) Developer and the City shall endeavor to identify a property or contiguous -properties of approximately 14 to 15 acres in size for sale in Orange County, California that would be suitable for exchange for the Army Parcel (the "Alternative Pazcel"). (b) Upon payment by Developer to the City of the Purchase Deposit and the City Expenses Deposit (each as defined below), the City shall endeavor to (i) enter into a contract and/or option to purchase the Alternative Pazcel (the "Purchase Agreement") with the owner of the Alternative Parcel ("Seller") on terms acceptable to City and Developer, each in its sole discretion, (ii) to satisfy the conditions to close set forth therein pursuant to Section 2 below and (iii) subject to the terms of this Agreement, including Section 9 below, to close the City Purchase. (c) Prior to the time at which the Purchase Deposit becomes non-refundable and as a condition to City's willingness to continue with the transaction described in the Purchase Agreement, the City and Developer shall have (i) negotiated and executed an Exchange Agreement with the Army on terms acceptable to City and Developer, each in its sole discretion, specifying that the Army shall exchange the Army Reserve Parcel for the Alternative Parcel upon the terms and conditions set forth therein and (ii) entered into an amendment to the DDA ("DDA Amendment") setting forth the terms and conditions for sale of the Army Reserve Parcel, if acquired by the City, to Developer, including without limitation the terms and conditions described in Section 5 below, and 2 Tustin/Vestaz Army Exchange Agt. October 24, 2011 establishing the sale price to Developer of the Army Reserve Pazcel (the "Closing Price") as an amount equal to the sum of the following: (w) the greater of (i) the fair mazket value of the Army Reserve Pazcel and (ii) the purchase price of the Alternative Pazcel set forth in the Purchase Agreement, (x) any and all brokerage fees due in connection with the Exchange Transactions, (y) all closing costs for each transfer comprising the Exchange Transactions and (z) the City Transaction Expenses (defined below). The terms of the DDA Amendment shall, except as otherwise set forth therein, supersede the terms of this Agreement. It is the intent of the Parties that the DDA Amendment be consistent with the terms of this Agreement. (d) Upon (i) satisfaction of the conditions to close specified in each of the Purchase Agreement, the Exchange Agreement and the DDA Amendment and (ii) funding into escrow by Developer of the Closing Price, and provided that (x) Developer is not then in Default or Potential Default (each as defined in the DDA) under this Agreement or the DDA as amended by the DDA Amendment and (y) City shall not have terminated the Purchase Agreement or the Army Exchange Agreement pursuant to the provisions of Section 9 below, the City shall acquire the Alternative Pazcel in accordance with the requirements of the Purchase Agreement. (e) In accordance with Sections 4 and 10 below, immediately following the acquisition by City of the Alternate Pazcel, the City and the Army shall consummate the exchange of the Alternative Pazcel and the Army Reserve Pazcel. (f) In accordance with Sections 4 and 10 below, immediately following the acquisition by City of the Army Reserve Pazcel, the City shall convey the Army Reserve Pazcel to Developer and Escrow Agent shall deliver the Closing Price to the City. The failure of the Parties to identify a suitable Alternative Pazcel or of the City to acquire an Alternative Pazcel for any reason shall not be a default hereunder. 2. Alternative Pazcel. The Developer and the City will cooperate and will endeavor to identify an Alternative Pazcel meeting the requirements of the Army in a location, configuration and purchase price and other terms which aze satisfactory to the City and Developer each in its sole and absolute discretion. Although the acquisition of the Alternative Pazcel would normally be pursuant to a Purchase Agreement with refundable deposit at the end of a due diligence period, in the event that Developer, in its sole discretion, agrees to an option payment, the term "Purchase Deposit" as used herein shall refer to an option payment. Similazly, the term Purchase Agreement herein defined would also refer to an Option Contract if utilized in the Exchange. In the event a site is located by one of Developer's outside brokers, then, subject to Section 12 of this Agreement, the Parties will cooperate to endeavor to have that broker receive the buyer broker's portion of the sales commission. 3 Tustin/Vestaz Army Exchange Agt. October 24, 2011 3. Steps. (a) Concurrently with the execution of this Agreement, Developer shall fund the City Expenses Deposit (defined below). (b) In the event a suitable, available Alternative Parcel is identified and preliminarily or conditionally approved by the Army as satisfactory exchange property, and in the further event that the City and Developer (each in its sole discretion) can mutually agree with the Seller on the terms and conditions of a Purchase Agreement, then the following will occur. i. Developer shall fund the Purchase Deposit to the City. ii. The City shall execute the Purchase Agreement and pay the Purchase Deposit into escrow. iii. The Parties will cooperate in the due diligence activities on the Alternative Parcel and Developer will assist the City to complete the Exchange Agreement with the Army. (c) In the event each Party, in its sole and absolution discretion, determines to complete the Exchange, the items described in the following Sections shall operate. 4. Escrow. Three related escrows will be established with one Escrow Agent (i.e., First American) to be closed on a consecutive, simultaneous basis whereby (a) the City will acquire the Alternative Parcel from the Seller (the "City Purchase"), (b) the City will transfer the Alternative Parcel to the Army in exchange for the Army Reserve Parcel (the "Army Exchange"), and (c) the City shall transfer the Army Reserve Pazcel to the Developer (the "Developer Purchase"). 5. DDA Amendment. The Developer Purchase will be accomplished through the DDA Amendment whereby the Army Reserve Parcel will be incorporated into the Developer Parcels pursuant to the DDA and will be subject to the same terms and conditions of the DDA and the ancillary DDA documents such as the Special Restrictions (but not including components of the DDA or ancillary documents required by the Navy ownership and deeding of Navy property to the City per the DDA) so that the Army Reserve Parcel will be treated as Developer Pazcels pursuant to the DDA. 6. City Expenses Deposit. Developer shall pay all of the City's costs incurred in connection with the Exchange Transactions and each of them, including without limitation: (i) costs incurred by the City in drafting, negotiation, execution, implementation and/or termination of the Exchange Transactions and this Agreement, the Purchase Agreement, the Exchange Agreement, and the DDA Amendment, and each of them, (ii) City staff and City attorney 4 Tustin/Vestaz Army Exchange Agt. October 24, 2011 costs and third party fees and costs incurred for legal counsel, financial, engineering and other consultants and any other expenditures determined by the City to be reasonably necessary in connection with the Exchange Transactions and each of them, (iii) costs incurred by the City pursuant to this Agreement, the Purchase Agreement, the Exchange Agreement, and/or the DDA Amendment and (iv) any and all Claims (as defined in the DDA), costs, damages, expenses and/or chazges incurred by the City arising from or occurring as a result of the Exchange Transactions, or any of them, this Agreement, the Purchase Agreement, the Exchange Agreement, and/or the DDA Amendment (collectively, the "City Transaction Expenses"). In order to provide the City with funds to implement this Agreement, Developer shall pay the City Expenses Deposit as set forth below. (a) Developer shall have paid to City concurrently with the execution of this Agreement a deposit of $50,000 (the "City Expenses Deposit") that will be used by the City to pay its ongoing City Transaction Expenses (defined below). (b) If the amount of funds in the City Expenses Deposit account is depleted below Twenty-Five Thousand Dollazs ($25,000), the Developer shall be required to refresh the City Expenses Deposit in order that it again equal $50,000. The City Expenses Deposit shall not be applicable to the Closing Price or to the Purchase Deposit. (c) Following the close of escrow or the eazlier termination of this Agreement, the City shall apply the City Expenses Deposit to all of the City Transaction Expenses and shall thereafter refund to Developer the amount of such deposit, if any, remaining. In the event that the City determines prior to the close of escrow that the City Expenses Deposit will be insufficient to meet the City Transaction Expenses incurred through the close of escrow, Developer shall, as a condition to close of escrow, pay to the City through escrow the additional amounts remaining unpaid. (d) In addition to the other rights of the City set forth in this Agreement, the City shall have no obligation to open escrow until the City Expenses Deposit is paid to the City and shall have no obligation to close any escrow until Developer has reimbursed the City for all City Transaction Expenses incurred by the City prior to the close of escrow and has reimbursed the Army for all Army Transaction Expenses (defined below) incurred by the Army. (e) If following close of escrow, the City determines that is has previously incurred or subsequently incurs any additional City Transaction Expenses . Developer shall reimburse the City for such expenses promptly upon the receipt of an invoice setting forth the additional expenses. The provisions of this Section shall survive the close of escrow and the termination of this Agreement and shall not be merged into any deed. 5 Tustin/Vestaz Army Exchange Agt. October 24, 2011 7. Army Transaction Expenses. Developer acknowledges for the benefit of the City and the Army that Developer shall pay all of the Army's costs incurred in connection with the Exchange Transactions and each of them, including without limitation: (i) costs incurred by the Army in drafting, negotiation, execution, implementation and/or termination of the Army the Army Exchange and/or the Exchange Agreement, (ii) Army staff and attorney costs and third party fees and costs incurred for legal counsel, financial, engineering and other consultants and any other expenditures determined by the Army to be reasonably necessary in connection with the Army Exchange, (iii) costs incurred by the Army pursuant to the Exchange Agreement, and (iv) any and all Claims (as defined in the DDA), costs, damages, expenses and/or charges incurred by the Army arising from or occurring as a result of the Army Exchange or the Exchange Agreement (collectively, the "Army Transaction Expenses"). The City may, at its sole election, determine to use (or not to use) funds available in the City Expenses Deposit to pay the Army Transaction Expenses. If the City elects to utilize the City Expenses Deposit for Army Transaction Expenses, then such expenses shall be deemed City Transaction Expenses for purposes of Section 6 and Developer shall replenish the City Expenses Deposit in accordance with Section 6. If following close of escrow, the Army determines that is has previously incurred or subsequently incurs any additional Army Transaction Expenses, Developer shall reimburse the Army for such expenses promptly upon the receipt of an invoice setting forth the additional expenses. The provisions of this Section shall survive the close of escrow and the termination of this Agreement and shall not be merged into any deed. 8. Developer Right to Terminate. Developer will have the right to cause the City to terminate the City Purchase (and hence the other escrows) in its sole discretion at any time prior to the closing of the City Purchase and to terminate the Developer Purchase at any time prior to the closing of the City Purchase. Developer acknowledges that the loss of any Purchase Deposit forfeited thereby and all City Transaction Expenses incurred by City in connection with the Exchange Transactions will be borne by the Developer. The provisions of this Section shall survive the close of escrow and the termination of this Agreement and shall not be merged into any deed. 9. City Right to Terminate. The City may cancel the City Purchase, the Army Exchange and/or the Developer Purchase and terminate one or more of this Agreement, the Purchase Agreement, the Exchange Agreement and/or the DDA Amendment for any reason at any time. In the event of a termination of this Agreement, the Purchase Agreement and/or the Army Exchange Agreement, the City shall have no obligation to reimburse Developer for any expenses incurred by Developer with respect to this Agreement, the Purchase Deposit, the City Expenses Deposit or any other costs incurred by Developer associated with the Exchange Transactions. Developer's obligation to fund City Transaction Expenses shall not be relieved or excused due to the termination by the City of any agreement. The provisions of this Section shall survive the close of escrow and the termination of this Agreement and shall not be merged into any deed. f~ Tustin/Vestar Army Exchange Agt. October 24, 2011 10. Conditions to Close of Escrow. Neither the City nor Developer will be required to consummate the Exchange unless the Escrow Agent acknowledges that it is in possession of the Closing Price and documentation satisfactory to close the City Purchase, the Army Exchange, and the Developer Purchase and is unconditionally prepared to close such transaction and issue such CLTA title policies required by the contractual documentation for the three transactions, based on title commitments approved by the City, Developer, and the Army. 11. Term of Agreement. In the event that (a) the City and Developer have not identified an Alternative Parcel on or before , 2012 or (b) the Close of Escrow shall not have occurred for any reason on or prior to ~~ 2013, including, without limitation because of a termination of the Purchase Agreement and/or the Exchange Agreement, this Agreement shall terminate and be of no further force or effect, provided however, that the provisions of Sections 6, 7, 8, 9, 12 and 13 shall survive the termination of this Agreement. 12. No Real Estate Commission. The City shall not be liable for any real estate commissions, brokerage fees or finders' fees which may arise from this Agreement. The Developer represents that it has engaged no broker, agent or finder in connection with this Agreement or the transactions identified in this Agreement, other than disclosed to City in writing prior to the Effective Date. The Developer hereby agrees to indemnify and hold the City and its elected and appointed officials, employees and representatives harmless from any losses and liabilities arising from or in any way related to any claim by any broker, agent, or finder retained by the Developer regarding this Agreement or the transactions identified in this Agreement or the purchase or sale of other property at or adjacent to the Alternative Pazcel and/or the Army Reserve Pazcel. The provisions of this Section shall survive the close of escrow and the termination of this Agreement and shall not be merged into any deed. 13. Indemni Developer acknowledges that City is acting as a facilitator only and Developer hereby agrees to protect, indemnify, defend and hold harmless the City and its elected and appointed officials, employees, agents, attorneys, representatives, contractors, successors and assigns ("City Parties") from and against any and all Claims (as defined in the DDA) arising from or related to the acts and omissions of City, the City Parties, Developer and Developer Representatives (as defined in the DDA) or any third party in connection with: (a) the Exchange Transactions, this Agreement, the Purchase Agreement, the Exchange Agreement and/or the DDA Amendment, (b) the City Transaction Expenses, the Army Transaction Expenses and the Purchase Deposit, (c) entry onto the Alternative Parcel and/or the Army Reserve Parcel, or any other pazcel under consideration as the Alternative Pazcel, by the City, the City Parties, Developer or the Developer Representatives, and/or (d) the activities of, work on or use of the Alternative Parcel and/or the Army Reserve Pazcel or any other pazcel under consideration as the Alternative Parcel, by the City, the City Parties, Developer or the Developer Representatives, including with respect to any inspections, surveys, tests, investigations and studies carried out by the City, the City Parties, Developer or the Developer Representatives on or adjacent to such pazcels. The Developer shall keep the Alternative Parcel and/or the Army Reserve Parcel free and cleaz of any mechanics' liens or materiahnen's liens related to the inspection of the Alternative Pazcel and/or the Army 7 Tustin/Vestaz Army Exchange Agt. October 24, 2011 Reserve Pazcel. The provisions of this Section shall survive the close of escrow and the termination of this Agreement and shall not be merged into any deed. 14. No Partnership. Nothing contained in this Agreement shall be deemed or construed to create a partnership, joint venture or any other relationship between the Parties hereto other than purchaser and seller according to the provisions contained in this Agreement, or cause the City to be responsible in any way for the debts or obligations of the Developer. 15. No Consideration. The Developer has not paid or given, and will not pay or give, any third person any money or other consideration for obtaining this Agreement, other than the normal cost of conducting business and cost of professional services such as azchitects, engineers attorneys and real estate brokers. 16. Binding Agreement. This Agreement. shall be binding upon and inure to the benefit of the Parties hereto, their legal representatives, successors, and permanent assigns. 17. Governing Agreement. This instrument shall be interpreted and construed with the laws in the State of California. 18. Third Party Beneficiaries. This Agreement has been made and entered into solely for the benefit of the Parties to this Agreement and their respective successors and permitted assigns. Except as set forth in Section 7 with respect to the Army and payment of Army Transaction Expenses, nothing in this Agreement confers any rights or remedies on any other entity or person. Nothing in this Agreement relieves or discharges the obligation or liability of any third parties or persons to any Parties to this Agreement. 19. Counterparts. This Agreement may be executed in two or more separate counterparts, each of which, when so executed, shall be deemed to be an original. Such counterparts shall, together, constitute and shall be one and the same instrument. This Agreement shall not be effective until the execution and delivery by the Parties of at least one set of counterparts. The Parties agree to recognize execution of this Agreement by facsimile signatures; provided, however, that such execution by facsimile shall not be effective unless a manually executed copy of the signature page is promptly sent by U.S. Postal Service, postage prepaid or is hand delivered, and such manually signed page is actually received by the other Party within five (5) calendar days of its execution. The Parties hereby authorize each other to detach and combine original signature pages and consolidate them into a single identical original. Any one of such completely executed counterparts shall be sufficient proof of this Agreement. IN WITNESS WHEREOF, the City and Developer have executed this Agreement as of the date first set forth above. (signatures on next page) 8 Tustin/Vestaz Army Exchange Agt. October 24, 2011 CITY OF TUSTIN, CALIFORNIA By: ATTEST: By: Pamela Stoker City Clerk Dated: APPROVED AS TO FORM By: Amy E. Freilich, Esq. Special Real Estate Counsel City Manager and/or Christine Shingleton, Assistant City Manager VESTAR/KIMCO TUSTIN, L.P., a California limited partnership By: Vestar Tustin, L.L.C. Its: General Partner By: Hanley Tustin, Inc. Its: Managing Member By: Name: Title: 9 Tustin/Vestar Army Exchange Agt. October 24, 2011