HomeMy WebLinkAbout01-ATTACHMENT FATTACHMENT F
City Council Resolution No. 14 -13
(Disposition and Development Agreement)
RESOLUTION NO. 14-13
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
TUSTIN, CALIFORNIA, APPROVING DISPOSITION AND
DEVELOPMENT AGREEMENT 13-03 BETWEEN THE CITY OF
TUSTIN AND STANDARD PACIFIC CORPORATION FOR THE
DEVELOPMENT OF 375 RESIDENTIAL UNITS, A FOCAL
PARK AND OTHER NEIGHBORHOOD AMENITIES WITHIN
PLANNING AREA 15 OF NEIGHBORHOOD G OF THE MCAS
TUSTIN SPECIFIC PLAN
The City Council of the City of Tustin does hereby resolve as follows:
I. The City Council finds and determines as follows:
A.
That in 2010, the Tustin City Council approved the “Tustin Legacy Disposition
Strategy for the Former Master Developer Footprint” for Neighborhoods B, D, E,
and G, including Disposition Package 1B within Planning Area 15 of
Neighborhood G.
B.
That in July 2012, the City entered into an Exclusive Negotiation Agreement
(ENA) with the Developer for land acquisition and development of approximately
238 single family homes, a neighborhood park, and open space on Disposition
Parcel 1B. Subsequently, in February 2013 the ENA was amended expanding
the area under negotiation from 51 acres to 78 acres through the inclusion of
Parcel 6A. The single family homes were increased from 238 to 375 units. The
amended ENA allowed for a better plan for the neighborhood south of Moffett
Road and east of Park Avenue.
C.
That Standard Pacific Corporation and the City of Tustin have completed and
desire to enter into a Disposition and Development Agreement (DDA) 13-03 to
cause the development of 375 single family detached units, a focal park and other
neighborhood amenities for Disposition Packages 1B and 6A at Tustin Legacy.
D.
That the site is zoned as MCAS Tustin Specific Plan (SP-1) within Planning Area
15 of Neighborhood G; and designated as MCAS Tustin by the Tustin General
Plan. In addition, the project has been reviewed for consistency with the Air
Quality Sub-element of the City of Tustin General Plan and has been determined
to be consistent with the Air Quality Sub-element.
E.
That it is the City’s desire to effectuate development of the Project through the
sale and development of the Property in accordance with Disposition and
Development Agreement 13-03, all in conformance with Governmental
Requirements and in substantially the form on file with City Clerk, pursuant to
which, among other matters:
1. Sale of Land: $56,000,000 which will be received by the City upon
conveyance to the Developer which is anticipated in March 2014 but in no
event later than August 31, 2014. An independent third party appraisal was
conducted by the City; the appraisal confirms that the property is being sold
at Fair Market Value.
Resolution No. 14-13
DDA 13-03
Page 2
2. Marketing Fee: At conveyance, the Developer will pay to the City a Tustin
Legacy Master Marketing Program Fee of $50,000 which is used by the City
for marketing Tustin Legacy. This fee will be paid at the close of escrow.
3. Tustin Legacy Backbone Infrastructure Obligation: $16,934,704; the
Developer’s obligation will be received incrementally as building permits are
issued to the Developer. The incremental distribution to the City will be
accelerated to a lump sum payment by the Developer if the City awards a
contract and commences construction on the Peter’s Canyon Channel.
4. Community Facilities District (CFD): Estimated at $13,247,475. Tax ‘A’ for
facilities and infrastructure will require the issuance of bonds; the rate is
estimated at 0.31% of the property value. Tax ‘B’ for essential City services
and maintenance has been levied on previous projects within Tustin Legacy
at an average rate of 0.15% of the estimated property value. In addition, the
Developer will be required to participate in a TUSD Facilities Bond with an
estimated rate of 0.19% of the estimated property value. The overall average
property tax rate is estimated between 1.70% and 1.75%.
5. Subsequent Participation: The City will receive 50% of the amount by which
the total Net Profits exceed 8.50% of the Gross Sales Price received by the
Developer. Participation will be calculated at the completion of the project
which is no later than 60 months from the opening of model homes.
6. Property Tax Status: Currently the property is tax exempt because of City
ownership. The property will lose its tax exempt status upon conveyance of
the property to the Developer and will be taxed accordingly.
7. Transaction Costs: The City’s transaction costs are borne by the Developer.
8. The Developer will develop the proposed project of Disposition Packages 1B
and 6A in accordance with the Disposition and Development Agreement
(DDA) 13-03, Development Agreement (DA) 2013-003, Concept Plan (CP)
2013-002, Design Review (DR) 2013-006, and Tentative Tract Map (TTM)
17507, consistent with any conditions of approval.
F.
That a public hearing was duly noticed, called, and held on January 21, 2014, by
the Tustin City Council. The City Council continued the matter to a regular
meeting on February 4, 2014, and continued it further to February 18, 2014.
G.
That on January 16, 2001, the City of Tustin certified the Program Final
Environmental Impact Statement/Environmental Impact Report (FEIS/EIR) for the
reuse and disposal of MCAS Tustin. On December 6, 2004, the City Council
adopted Resolution No. 04-76 approving a Supplement to the FEIS/EIR for the
extension of Tustin Ranch Road between Walnut Avenue and the future alignment
of Valencia North Loop Road. On April 3, 2006, the City Council adopted
Resolution No. 06-43 approving an Addendum to the FEIS/EIR. And, on May, 13,
2013, the City Council adopted Resolution No. 13-32 approving a second
Addendum to the FEIS/EIR. The FEIS/EIR along with its Addenda and
Supplement is a program EIR under the California Environmental Quality Act
(CEQA). The FEIS/EIR, Addenda and Supplement considered the potential
Resolution No. 14-13
DDA 13-03
Page 3
environmental impacts associated with development on the former Marine Corps
Air Station, Tustin
An Environmental Checklist has been prepared and concluded that these actions
do not result in any new significant environmental impacts or a substantial
increase in the severity of any previously identified significant impacts in the
FEIS/EIR. Moreover, no new information of substantial importance has surfaced
since certification of the FEIS/EIR.
II. DDA 13-03, a copy of which is on file with the Office of the City Clerk, is hereby
approved subject to any non-substantive modifications as may be determined necessary
as may be approved by the City Manager’s office, or as recommended by the City’s
special counsel or the City Attorney.
III. The City Manager is hereby authorized to take such actions, and execute such
documents and instruments, as deemed necessary or desirable to implement the terms
of the DDA and all attachments to the DDA and other documents as necessary and,
upon satisfaction of all conditions and obligations of the Developer thereto and pursuant
to the DDA, to transfer the subject site to the Developer.
PASSED AND ADOPTED by the City Council of the City of Tustin at a regular meeting on the
th
18 day of February, 2014.
ELWYN A. MURRAY
MAYOR
ATTEST:
JEFFREY C. PARKER
CITY CLERK
STATE OF CALIFORNIA )
COUNTY OF ORANGE )
CITY OF TUSTIN )
I, Jeffrey C. Parker, City Clerk and ex-officio Clerk of the City Council of the City of Tustin,
California, do hereby certify that the whole number of the members of the City Council of the City of
Tustin is five; that the above and foregoing Resolution No. 14-14 was duly passed and adopted at
th
a regular meeting of the Tustin City Council, held on the 18 day of February, 2014, by the
following vote:
COUNCILMEMBER AYES:
COUNCILMEMBER NOES:
COUNCILMEMBER ABSTAINED:
COUNCILMEMBER ABSENT:
____________________________
JEFFREY C. PARKER
CITY CLERK
TUSTIN LEGACY
DISPOSITION AND DEVELOPMENT AGREEMENT
FOR DISPOSITION PARCELS 1B& 6A
by and between
CITY OF TUSTIN
and
STANDARD PACIFIC CORP.,
A DELAWARE CORPORATION
DATED: __________________
TABLE OF CONTENTS
1.Subject and Purpose of Agreement; Parties; Applicable Requirements...........................1
1.1.Background Regarding MCAS Tustin..................................................................1
1.2.Description of Development Parcels....................................................................2
1.3.Purpose of Agreement...........................................................................................2
1.4.Parties to the Agreement.......................................................................................3
1.5.Federal Requirements Applicable to Tustin Legacy.............................................4
1.6.Local Requirements Applicable to Tustin Legacy................................................4
1.7.Not a Development Agreement............................................................................4
1.8.City Transaction Expenses and Independent Contract Consideration..................4
1.9.Definitions; Attachments......................................................................................6
2.Prohibition against Transfers and Transfer of Control.....................................................6
2.1.Importance of Developer Qualifications...............................................................6
2.2.Transfers and Transfers of Control.......................................................................7
2.3.Remedies for Improper Transfers or Transfers of Control.................................13
2.4.Changes...............................................................................................................13
3.Representations and Warranties......................................................................................13
3.1.Developer’s Representations and Warranties.....................................................13
3.2.Developer Covenants Regarding Representations and Warranties....................16
3.3.City Representations and Warranties..................................................................16
3.4.City Covenants Regarding Representations and Warranties..............................18
4.Conveyance of Property from City to Developer...........................................................18
4.1.Conveyance of Property......................................................................................18
4.2.Purchase Price.....................................................................................................19
4.3.Payment of Purchase Price..................................................................................20
4.4.Escrow and Joint Escrow Instructions................................................................20
4.5.Investigation; Property Conveyed “As-Is”.........................................................21
4.6.Covenants; Preconditions to Close of Escrow....................................................27
5.Developer’s Due Diligence Investigation.......................................................................28
5.1.Due Diligence Period..........................................................................................28
5.2.No Financing Contingency.................................................................................28
5.3.Termination of Agreement..................................................................................29
5.4.Limited License..................................................................................................29
5.5.Indemnity............................................................................................................29
5.6.Review of Certain Records and Materials..........................................................30
5.7.Communications with City and Third Parties.....................................................30
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6.Title; Survey....................................................................................................................31
6.1.Survey by Developer...........................................................................................31
6.2.Permitted Exceptions..........................................................................................31
6.3.Supplemental Title Reports.................................................................................31
6.4.ALTA Policy; Endorsements..............................................................................32
7.Closing............................................................................................................................33
7.1.Time and Place of Closing..................................................................................33
7.2.Conditions Precedent to Close of Escrow...........................................................33
7.3.Additional Close of Escrow Conditions.............................................................38
7.4.Procedures for Conveyance................................................................................39
8.Development of the Property and Additional Covenants of Developerand City...........41
8.1.Scope of Development........................................................................................41
8.2.Timing and Conditions of Project Development................................................42
8.3.Land Use Matters................................................................................................43
8.4.Design Approval.................................................................................................44
8.5.Financial Status...................................................................................................47
8.6.Project Budget Statement....................................................................................47
8.7.CFD; Fees and Exactions....................................................................................48
8.8.Final Map............................................................................................................52
8.9.Construction of Improvements by Developer.....................................................52
8.10.Tustin Legacy Backbone Infrastructure Program...............................................53
8.11.Outside Date of Completion of Construction.....................................................54
8.12.Development Covenants.....................................................................................54
8.13.City Rights of Access..........................................................................................56
8.14.Disclaimer of Responsibility by City and Exculpation.......................................56
8.15.Local, State and Federal Laws............................................................................57
8.16.Liens, Taxes and Assessments............................................................................57
8.17.City Additional Covenants..................................................................................58
9.Certificate of Compliance...............................................................................................58
9.1.Completion; Schedule of Performance...............................................................58
9.2.Certificate of Compliance Defined.....................................................................58
9.3.Conditions Precedent for Certificate of Compliance..........................................59
9.4.Conclusive Presumption.....................................................................................60
9.5.Not Evidence.......................................................................................................60
9.6.City Obligations..................................................................................................60
9.7.Effect of Certificate of Compliance; Termination of Agreement.......................60
10.Indemnification and Environmental Provisions..............................................................61
10.1.Developer’s Indemnification..............................................................................61
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10.2.Environmental Indemnity...................................................................................62
10.3.Duration of Indemnities......................................................................................62
10.4.Claim Response..................................................................................................63
10.5.Release Notification and Remedial Actions.......................................................63
10.6.Conflict with Section 330 and Other FederalGovernment Obligations.............64
10.7.Insurance and Indemnification............................................................................64
10.8.Selection of Counsel and Defense Obligations...................................................65
10.9.Settlement Procedures.........................................................................................65
11.Insurance.........................................................................................................................66
11.1.Required Insurance.............................................................................................66
11.2.General Insurance Requirements........................................................................68
12.Covenants and Restrictions.............................................................................................69
12.1.Use Covenant......................................................................................................69
12.2.Maintenance Covenant........................................................................................69
12.3.Duration of Covenants........................................................................................71
12.4.Profit Participation Price.....................................................................................71
12.5.Obligation to Refrain from Discrimination.........................................................72
12.6.Deed Restrictions/Covenants Running with the Land........................................72
12.7.Priority of DDA and Special Restrictions...........................................................72
12.8.Landscape Maintenance Agreement...................................................................72
12.9.Park and Access Easement..................................................................................72
13.CC&Rs and Homeowners’ Association..........................................................................73
13.1.City Approval of CC&Rs....................................................................................73
13.2.Homeowners’ Association and Sub-Association................................................74
14.Potential Defaults and Material Defaults........................................................................74
14.1.Potential Defaults................................................................................................74
14.2.Material Defaults................................................................................................74
14.3.Due Diligence Information; Products.................................................................78
15.Nonoccurrence of a Condition at Close of Escrow.........................................................78
15.1.Failure of a Condition Absent a Default.............................................................78
15.2.Material Default of Developer Results in Failure of Close of Escrow...............79
15.3.Failure to Close; Default of City.........................................................................80
16.Remedies for Defaults After the Close of Escrow..........................................................82
16.1.General Remedies...............................................................................................82
16.2.Lien Rights..........................................................................................................82
16.3.Right of Purchase................................................................................................82
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16.4The Right of Reversion.......................................................................................85
Access and Inspection.........................................................................................88
16.5.
16.6Obligations and Release Following Repurchase or Reversion...........................89
16.7.CFD Default Remedies.....................................................................................92
16.8.Cooperation of Developer...................................................................................94
17.General Provisions..........................................................................................................94
17.1.Applicable Law; Consent to Jurisdiction; Service of Process............................94
17.2.Legal Fees and Costs..........................................................................................95
17.3.Modifications or Amendments...........................................................................95
17.4.FurtherAssurances..............................................................................................95
17.5.Rights and Remedies Are Cumulative; Limitation on Damages........................95
17.6.Notices, Demands and Communications between the Parties............................96
17.7.Delay...................................................................................................................98
17.8.Conflict of Interest............................................................................................100
17.9.Non-liability of City Officials and City or Developer Employees...................100
17.10.Inspection of Books and Records.....................................................................100
17.11.Consents and Approvals...................................................................................100
17.12.No Real Estate Commissions............................................................................101
17.13.Date and Delivery of Agreement......................................................................101
17.14.Constructive Notice and Acceptance................................................................102
17.15.Survival of Covenants, Representation and Warranties...................................102
17.16.Construction and Interpretation of Agreement.................................................102
17.17.Time of Essence................................................................................................103
17.18.Fees and Other Expenses..................................................................................103
17.19.No Partnership..................................................................................................103
17.20.Binding Effect...................................................................................................103
17.21.No Third Party Beneficiaries............................................................................103
17.22.Counterparts......................................................................................................104
17.23.Duplicate Originals, Entire Agreement and Waivers.......................................104
17.24.Confidentiality..................................................................................................105
17.25.Proprietary and Governmental Roles; Actions by Parties................................106
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DISPOSITION AND DEVELOPMENT AGREEMENT
FOR PARCELS 1B& 6A
THIS DISPOSITION AND DEVELOPMENT AGREEMENT FOR PARCELS 1B & 6A(the
AgreementEffective Date
“”) is entered into as of ________________, 2014(the “”) by and
City
between the CITY OF TUSTIN (as more fully defined in Section1.4.1, “”) and
STANDARD PACIFIC CORP., a Delaware corporation (as more fully defined in Section1.4.2,
Developer
the “”). The City and Developer are sometimes referredto in this Agreement
PartyParties
individually as a “” and collectively as the “.” The Parties agree as follows:
Subject and Purpose of Agreement; Parties; Applicable Requirements
1..
Background Regarding MCAS Tustin
1.1..
1.1.1.Pursuant to the Defense Base Closureand Realignment Act of 1990,
(PartA of Title XXIX of Public Law 101-510; 10U.S.C. Section2687 Note), as amended (the
Base Closure Law
“”) the Federal Government (defined below) determined to close the Marine
MCAS Tustin
Corps Air Station-Tustin (“”) located substantially in the City of Tustin. In 1992,
the City was designated as the Lead Agency or Local Redevelopment Authority for preparation
of a reuse plan for MCAS Tustin in order to facilitate the closure of MCAS Tustin and its reuse
in furtherance ofthe economic development of the City and surrounding region. The MCAS
Tustin Reuse Plan developed in accordance with this procedure was adopted by the City Council
Reuse Plan
of the City of Tustin on October 17, 1996 and amended in September, 1998 (the “”).
1.1.2.A Final Environmental Impact Statement/Final Environmental Impact
Final EIS/EIR
Report for the Disposal and Reuse of MCAS Tustin (the “”) and Mitigation
Monitoring and Reporting Program for the Final EIS/EIR were adopted by the City on January
16, 2001. In March 2001, a Record of Decision was issued by the United States Department of
Navy
the Navy (hereinafter, “”) approving the Final EIS/EIR and the Reuse Plan. Subsequently,
a Supplement to the Final EIR/EIS and an Addendum to the Final EIS/EIR were approved by the
City.
1.1.3.In May 2002, the Navy and the City entered into that certain Agreement
between the United States of America and the City of Tustin, California for the Conveyance of a
Portion of the Former Marine Corps Air Station Tustin dated as of May 13, 2002 (the
Memorandum of Agreement
“”), pursuant to which the Navy agreed to convey 1,153 acres of
MCAS Tustin to the City. On May 13, 2002, a total of 977 acres, including the Development
Parcels (as definedbelow) which are the subject of this Agreement, were conveyed by the Navy
to the City by quitclaim deed in accordance with the provisions of the Memorandum of
Agreement. The additional acreage was made subject to a ground lease by the City from the
Navy. The 1,153 acres of MCAS Tustin located within the City of Tustin and either conveyed
by the Navy to the City or subject to ground lease between the Navy and the City is referred to in
Tustin Legacy.
this Agreement as “”
1.1.4.On February 3, 2003, the City adopted an ordinance approving the MCAS
Tustin Specific Plan/Reuse Plan setting forth the zoning and entitlement framework for future
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development of Tustin Legacy. Since its initial adoption, the City has approved numerous
Specific Plan Amendments. The Specific Plan conforms to and implements the Reuse Plan and
the City’s General Plan.
1.1.5.The City desires to effectuate development of Tustin Legacy through the
sale and development of such property in accordance with applicable federal and local
requirements. It is the City’s intent that Tustin Legacy shall be developed in accordance with all
City requirements, including implementing the Reuse Plan and the Specific Plan. To this end,
pursuant to the Disposition Strategy for the Master Development Footprint adopted by the City
RFP
Council in April 2011, the City issued a Request for Proposals (the “”) seeking a developer
for Disposition Package 1B. In response to the RFP, Developer submitted a proposal for
purchase and was selected by the City for further negotiations. Subsequently, on July 17, 2012,
Developer and the City entered into that certain Exclusive Agreement to Negotiate (Disposition
Original ENA
Package 1B) (“”) with respect to the land described by Disposition Package 1B.
The Original ENA was subsequently amended by that certain First Amendment to Exclusive
First
Agreement to Negotiate (Disposition Package 1B) dated as of February 5, 2013 (“
Amendment to ENA
”) which added certain property referred to therein as the 6A Property
(comprising a portion of Disposition Package 6) in order to allow the City and Developer to
achieve a more well-planned community and greater economies of scale with respect to grading
and infrastructure. The Original ENA and the First Amendment to ENA are collectively referred
ENA
to herein as the “”.
Description of Development Parcels
1.2..
1.2.1.The real property that is the subject of this Agreement consists of
approximately 74 gross acres of land located in the City of Tustin, County of Orange, California,
Development Parcels
as legally described and depicted on Attachment 2(collectively the “”).
As of the Effective Date, the Development Parcels are owned in fee by the City. The
Development Parcels comprise the land described in Disposition Package 1B and a portion of the
land described in Disposition Package 6 and are aportion of the property referred to in the Navy
transfer documents as I--H-1, I-H-7 and I-H-8 and in the Reuse Plan as Parcels 29, 30 and 31, as
subsequently reparcelized.
1.2.2.As part of the transactions contemplated herein, Developer shall process a
Final Map for the Development Parcelspursuant to the Subdivision Map Act and the City Code
as generally depicted on the Site Plan attached as Attachment 3, for the development of 375
Homes, which is anticipated to be accepted by the City and recorded with respect to the
Development Parcels following the Close of Escrow.
Purpose of Agreement
1.3..
1.3.1.The purpose of this Agreement is (a) to effectuate the Reuse Plan and the
Specific Plan, in accordance with the terms and conditions set forth therein and in the
Memorandum of Agreement and the Federal Deed, through disposition and development of
portions of Tustin Legacy as further described in this Agreement and (b) to provide for the sale
and conveyance of the Property (as defined below) and its maintenance and use in accordance
with the requirements of this Agreement.
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1.3.2.This Agreement further provides for development by Developer on the
Project
Development Parcels of the “” to consist of construction and installation of the following
Improvements: (a)the Horizontal Improvements,as further described onAttachment 8and
depicted onAttachment 9,(b)the On-Lot Improvementsand (c) the Vertical Improvements,
generally consisting of a residential ownership project and containing on the Development
Parcels approximately 375 Homes for saleto Homebuyers in four product types and a complete
accompanying set of amenities, all as further described inthe Scope of Development attached
hereto as Attachment 8. The Vertical Improvements,the Horizontal Improvementsand the On-
Improvements
Lot Improvements(collectively, the “”) shall be designed and constructed by
Developer in a manner consistent with the Specific Plan, the Reuse Plan, the Approved Plans, the
Entitlements and all applicable Governmental Requirements.
1.3.3.The disposition of the Property, the development and Completion of the
Project pursuant to this Agreement, and the fulfillment generally of this Agreement, are in the
vital and best interests of the citizens of the City and the health, safety and welfare of its
residents, and are in accord with the public purposes and provisions of applicable federal, state,
and local laws and requirements.
Parties to the Agreement
1.4..
City
1.4.1.. The City is a municipal corporation of theState. The City has been
recognized as the Local Redevelopment Authority by the Office of the Secretary of Defense for
City
the former Marine Corps Air Station, Tustin, for purposes of the Base Closure Law. “” as
used in this Agreement shall mean the City of Tustin and each assignee or successor to the City’s
rights, powers and responsibilities, provided, however, that in the event the City exercises such
right to assign any of its proprietary obligations, such assignment shall not relieve the City of any
responsibility for its obligations, if any, under this Agreement. The City Council shall have the
right, in its sole and absolute discretion, to assign its rights and obligations to any agency or
instrumentality of the City. The principal office of the City and mailing address is 300
Centennial Way, Tustin, California 92780.
Developer
1.4.2.. Developer is Standard Pacific Corp., a Delaware corporation.
Developer
Whenever the term “” is used in this Agreement, such term shall have the meaning set
forth in Attachment 1. The principal office of Standard Pacific Corp. and its mailing address is
15360 Barranca Parkway, Irvine, California 92618.
Relationship of City andDeveloper
1.4.3.. It is hereby acknowledged that the
relationship of the City andDeveloper is neither that of a partnership nor that of a joint venture.
Notwithstanding anyprovision of this Agreement, Developer is not, and shall not be deemed to
be, the agent of the City for any purpose, and shall not have the power or the authority to bind
the City to any contractual or other obligation. Prior to the Close of Escrow, Developer may
only characterize itself to third parties as the prospective purchaser and/or developer of the
Property. Developer shall not at any time hold itself out to the City or to any other third party as
an agent of the City, and shall not, by any act or omission, mislead any third party into believing,
or allow any third party to continue in the mistaken belief, that Developer is an agent of the City
or has the power or authority to bind the City to any contractual or other obligation.
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Federal Requirements Applicable to Tustin Legacy
1.5..
1.5.1.The Parties acknowledge and agree that this Agreement is entered into as
part of an economic development conveyance of Tustin Legacy to the City pursuant to the Base
Closure Law, the Memorandum of Agreement and the terms and conditions of the Federal Deed,
including the Environmental Restriction pursuant to California Civil Code Section1471
contained therein. Notwithstanding any provision to the contrary contained in this Agreement,
this Agreement is and shall be subjectto the terms and conditions of the Memorandum of
Agreement and the Federal Deed and the rights, obligations and remedies of the Federal
Government thereunder, and nothing contained in this Agreement shall be construed in a manner
that is inconsistent withthe rights, obligations and remedies of the Federal Government
thereunder.
1.5.2.Notwithstanding anything in this Agreement to the contrary, if any
provision of this Agreement contradicts, modifies or in any way changes the terms of the
Memorandum of Agreement or the Federal Deed, the terms of the Memorandum of Agreement
and Federal Deed shall prevail and govern.
Local Requirements Applicable to Tustin Legacy
1.6..
This Agreement is subject to all Governmental Requirements, including the General Plan,
the Specific Plan, the City Code, the Reuse Plan and any redevelopment plan applicable to the
Property, provided, however, that the City acknowledges that, prior to the Closing, City and
Developer shall enter into a Development Agreement pursuant to Government Code Section
DA
65864etseq.(the “”) relating to the Property and that any provisions of this Agreement
requiring Developer or the Property to comply with any Governmental Requirements imposed by
the City relating to entitlements or development of the Property shall be subject to the terms of
the DA and in the event of any inconsistency between such Governmental Requirements and the
DA, the Governmental Requirements required to be imposed pursuant to the DA shall control.
Not a Development Agreement
1.7..
This Agreement is not a development agreement as provided in Government Code
Section65864 and, as further set forth in Section8.3.3, is not a grant of any entitlement, permit,
land use approval, or vested right in favor of Developer, the Project or the Property. The City
shall use good faith efforts, within applicable legal constraints and consistent with applicable
City policies, to take such actions as may be necessary or appropriate to effectuate and carry out
this Agreement in a timely and commercially reasonable manner.
City Transaction Expenses and Independent Contract Consideration
1.8..
ENA Transaction Expenses
1.8.1.. Pursuant to the ENA, Developer has paid
to the City a deposit of One Hundred Thousand Dollars ($100,000) assupplemented from time to
ENA Deposit
time pursuant to the terms of the ENA (the “”), to be used by the City to pay the
City’s third party predevelopment costs, including third party consultants, outside counsel and
other expenditures required in connection with the drafting, negotiation and execution of this
Agreement or the termination of the ENA, including any and allCity third party fees and costs
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ENA Transaction Expenses
incurred by legal counsel, financial and other consultants (the “”).
After deducting all ENA Transaction Expenses incurred by the City with respect to the period
ending on the Effective Date, the City shall return the remaining ENA Deposit to Developer.
Notwithstanding the termination of the ENA pursuant to Section 17.23.2, if the amount of ENA
Transaction Expenses to the Effective Date exceeds the amount of the ENA Deposit, Developer
shall pay the City such outstanding amounts due within thirty (30) calendar days following
receipt of an invoice from the City therefor.
City Costs Deposit
1.8.2.. Upon the Effective Date and as a condition
precedent to the effectiveness of this Agreement, Developer shall deliver to the City a new
City Costs Deposit
deposit of $50,000 (the “”). The City Costs Deposit shall be deposited by the
City in an account in a bank or trust company selected by the City. If any interest is paid on such
account, such interest shall accrue to any balances in the account for the benefit of Developer
and as additional security for Developer obligations hereunder. One Hundred Dollars ($100.00)
of the City Costs Deposit shall be retained by the City as “independent contract consideration.”
From and after the Effective Date, the remainder of the City Costs Deposit shall only be used by
the City to pay the City’s third party out-of-pocket costs including third party fees and costs
incurred for legal counsel, financial, engineering and other consultants and any other
expenditures required in connection with the implementation of this Agreement or the
termination thereof, commencingwith the Effective Date through the earlier of the conclusion of
the transaction associated with the Close of Escrow or termination of this Agreement
City Transaction Expenses
(collectively, the “”), and the City Costs Deposit will be depleted
accordingly.If at any time the amount of funds in the City Costs Deposit account is depleted
below Twenty-Five Thousand Dollars ($25,000), Developer shall be required to pay to the City
each time an additional Twenty-Five Thousand Dollars ($25,000) which shall be credited to the
City Costs Deposit. Each such payment shall be deposited by the City into the City Costs
Deposit account and shall be applied to City Transaction Expenses in accordance with the
provisions of this Section1.8.2.Following the Close of Escrow or earlier termination of this
Agreement, the City shall be entitled to deduct from the City Costs Deposit the payment of all
City Transaction Expenses incurred with respect to the transactions described by this Agreement,
and any remaining City Costs Deposit shall be promptly returned by the City to Developer. In
the event that the City Costs Deposit is insufficient to cover the City Transaction Expenses,
Developer shall promptly pay to the City the outstanding amounts due, but in no event in excess
of the City Expense Cap(as definedbelow).
ExpenseCap.
1.8.3.Notwithstanding anything to the contrary set forth in this
Agreement, inno event shall Developer be obligated to pay more than the aggregate sum of
$400,000for the ENA Transaction Expenses and the City Transaction Expensescombined(the
City Expense Cap
“”).
Payment of City Transaction Expenses; Exclusions from City
1.8.4.
Transaction Expenses
. From and after the Effective Date, the City Costs Deposit may be used
by the City to pay the City Transaction Expensesand any then remaining ENA Transaction
Expenses. Determination of costs, expenses, and fees constituting ENA Transaction Expenses
and/or City Transaction Expenses shall be made by the City in its reasonable discretion and
Developer shall upon request be entitled to receive summary notices from the City setting forth
amounts constituting ENA Transaction Expenses and/or City Transaction Expenses and related
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non-confidential documents evidencing such expenses,provided that such expenses do not
exceed the City Expense Cap. Notwithstanding anything to the contrary in this Agreement, the
City and Developer hereby acknowledge and agree that neither the ENA Transaction Expenses
nor the City Transaction Expenses include: (a) any fees or deposits required of Developer for
processing entitlement applications; (b) any fees or costs for complying with provisions of
CEQA or its State CEQA implementing regulations; (c) any costs to review or approve any
applications or submittals by Developer to the City in connection with the Project; (d) the Project
Fair Share Contributionor any other development impact fees, exactions or other costs imposed
as conditions of approval with respect to the Entitlements or pursuant to the Other Agreements or
(e) any other matters in this Agreement that expressly require Developer to pay, at its sole cost,
for the expenses in connection with such matters, other than as expressly set forth in this Section
1.8. The obligation of Developer to pay for the ENA Transaction Expenses and the City
Transaction Expenses pursuant to this Section1.8 shall not diminish or limit Developer’s
obligation to pay for any of the costs in the preceding sentence.
Definitions; Attachments
1.9..
1.9.1.Capitalized terms usedin this Agreement, including in the Attachments
attached hereto, unless otherwise defined in this Agreement, shall have the respective meanings
specified in the Glossary of Defined Terms attached hereto as Attachment1. Unless otherwise
indicated, references in this Agreement to sections, paragraphs, clauses, exhibits, attachments
and schedules are to the same contained in or attached to this Agreement and all attachments and
schedules referenced in this Agreement are incorporated in this Agreement by this reference as
though fully set forth in this Section.
1.9.2.Wherever used in this Agreement, the term “substantially in the form and
substance of” shall mean that the referenced document, when compared to the previously
approved form of document, is consistent in all material respects, and none of the modifications
in the referenced document diminish a Party’s rights or increase such Party’s obligations
thereunder, as determined by the Party for whose benefit the condition is written, in its sole
discretion.
Prohibition against Transfers and Transfer of Control
2..
Importance of Developer Qualifications
2.1..
Developer represents and agrees that its undertakings pursuant to this Agreement are for
the purpose of development of the Project and not for speculation in landholding. The Parties
further recognizeand agreethat the qualifications and identity of Standard Pacific Corp.,which
is a publicly traded company listed on the New York Stock Exchange(Standard Pacific Corp.,
and specifically excluding anyTransferee,successor or assign thereof, is referred to herein as the
Initial Developer
“”),and Initial Developer’s agreement (a) that it has the financial capacity to
construct the Project without encumbering the Property with a Mortgageand(b) to remain fully
liable under this Agreementand the Other Agreements unless specifically releasedby the City
pursuant to Section 2.2.3(a)(iii),Section 9orSection 16.6of this Agreement are of particular
concern to the City and community and in light of the following:
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(i)The importance of the development of the Development Parcels and
Tustin Legacy to the general welfare of the community;
(ii)The fact that a Transfer of Control is for practical purposes a transfer of
rights and obligations under this Agreement or the Property; and
(iii)That it is because of the qualifications and identity of Initial Developer
and its Key Employees that the City is entering into the Agreement with Developer.
Transfers and Transfers of Control
2.2..
Restrictions on Transfers and Transfers and Control
2.2.1..
(a)For thereasons set forth in Section2.1, Developer, on behalf of
itself and all Successor Owners, acknowledges and agrees that, prior to the Recordation of the
Certificate of Compliance:
(i)Any Transfer or Transfer of Control in contravention of
this Section2 shall be a Material Default under this Agreement in
accordance with Section 14.2.3.
(ii)Except as set forth in Section 2.2.2, no Transfer or Transfer
of Control shall be valid or have any force or effect unless the City shall
have provided its prior written consent thereto in the City’s sole discretion.
(iii)No Person shall acquire any rights or powers under this
Agreement except as set forth in this Section 2.
(b)Notwithstanding any Transfersand/or Transfers of Control, Initial
Developer on behalf of itself and each Successor Owner agrees that:(i)Developer shall not be
released with respect tomatters for which it remains liable pursuant to Section 2.2.2(a), (b) and
(c),and (ii) unless it is released by the City as set forth in Section 2.2.3(a)(iii), Section16.6or
otherwise by the City in writing,each Developershall remain fully liable forthe obligations of
Developer under this Agreement and the Other Agreements for such period as it is Developer
under this Agreement and for such longer period as may be applicableto it during the Additional
Liability Periodand that Developer shall remain liable with respect to terms of this Agreement
surviving such termination for the period described herein.
Permitted Transfers and Transfers of Control
2.2.2.. The following Transfers
PermittedTransfers
and Transfers of Control are “” and shall not be subject to the City’s prior
written consent or otherwise subject to the requirements of Section 2.2.3, provided that in the case
of clauses (a) or (b) below,the Responsible Developer or the Responsible Developer’s Controlling
Person shall provide the City with notice of such transaction within ten (10) calendar days after its
occurrence,which notice shall include a certification that all of the applicable conditions set forth
in the applicable portionof this Section 2.2.2 have been satisfiedand where applicable, shall
affirm the ongoing obligation of the Responsible Developer under this Agreement notwithstanding
such Permitted Transfer:
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(a)Any Transfer by aResponsible Developer to a Developer Affiliate;
provided that (i) the City shall be entitled to look tothe Responsible Developer to fully comply
with this Agreement, and to cause the Developer Affiliate to comply with this Agreement, as
though there had not been a Transfer; and such Responsible Developer shall not be released from
its obligations under the Agreement, (ii) Responsible Developeris the Controlling Person of the
Developer Affiliate that is the Transferee, (iii)ResponsibleDeveloper shall not be in Potential
Default or Material Default under this Agreement at the time of such Transfer, and (iv) the
Transferee at the time of the Transfer shall have expressly assumed for itself and its successors
and assigns, and for the benefit of the City, by instrument substantially in the form and substance
of the instrument attached hereto as Attachment 16A, or, if applicable, Attachment16Bor
otherwise in a form acceptable to the City in its sole discretion, acknowledged and Recorded, all
the rights and obligations of Developer under this Agreement and the Other Agreements arising
from and after the date of such Transfer and the Transferee shall agree to assume and to be
subject to all the conditions and restrictions to whichDeveloper is subject by reason of this
Agreement and the Other Agreements;
(b)Any Transfer of Control by Initial Developer ofa Developer
Affiliatewhich has received a Transfer from Initial Developer pursuant to Section 2.2.2(a)
provided that (i) the City shall be entitled to look to Initial Developerto fully complywith this
Agreement as though there had not been a Transfer of Control of such Developer Affiliate,and
(ii)theInitial Developer remains the Controlling Person of the Developer Affiliate that is the
subject of the Transfer of Control;
(c)A Transfer of Control by or with respect to Initial Developer, or
Initial Developer’sControlling Person, in each caseso long as (i) Initial Developer is a publicly
traded entityand (ii) the Initial Developer remains the “Developer” under this Agreement and
provided further that:this provision (x) shall not apply to a dissolution pursuant to clause (b) of
the definition of Transfer of Controland(y) shall not apply to a sale of assetspursuant to clause
(a) of the definition of Transfer of Control unless such sale affects the assets, liabilitiesand
operations of Initial Developer or an Initial Developer’s Controlling Person generally with
respect to all or substantially all of its assets, liabilitiesand operations;
(d)Any Transfer described by Section 2.2.7 to a Homebuyer or a
Homeowners’Association;
(e)Any transfer of portions of the Property to the City and/or grants of
easements affecting the Development Parcels to the City, to any public or quasi-public entity or
to any utility, as necessary or desirable for the development thereof; and
(f)Any temporary license or other grant of access rights to the
Development Parcels to the City and/or to any other third party, as necessary or desirable for the
development of the Property except that the CC&Rs shall be subject to review and approval by
the City as set forth in Section 13.
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Provisions Applicable to Transfers and Transfers of Control Other
2.2.3.
than Permitted Transfers
.Prior to issuance of a Certificate of Compliance, any Transfer
pursuant to this Section 2.2.3 shall require the prior written consent of the City in its sole
discretion. In addition, except for Permitted Transfers described in Section 2.2.2, Developer
shall comply with the following prior to any Transfer and any Transfer of Control:
(a)Except as set forth in Sections2.2.3(b),Developer shall have no
right to Transfer partial interests in the Property,the Project, this Agreement or Developer’s
rights and obligations under this Agreement. The following shall apply withrespect to Transfers
of the entirety of the Developer’s interest in this Agreement, the Projectand the Propertyand to
Transfers of Control by Developer:
(i)Developer shall provide to the City at least twenty (20)
Business Days prior to the date of any proposed Transfer or Transfer of
Control: (A) the name of the proposed Transferee or new Controlling
Person, as applicable; (B) all of the material proposed terms of the
Transfer or Transfer of Control; (C) in the case of a Transfer, current
audited financialstatements of the proposed Transferee (or financial
statements certified by an officer or authorized representative of the
proposed Transferee, if the proposed Transferee does not have audited
financial statements); (D) in the case of a Transfer of Control, current
audited financial statements of the proposed new Controlling Person (or
financial statements certified by an officer or authorized representative of
the proposed new Controlling Person, if the proposed new Controlling
Person does not have audited financial statements); (E) the names of all
Persons who Control the proposed Transferee or the new Controlling
Person, as applicable; (F) in the case of Transfer, a certificate of the
proposed Transferee describing other real estate projects developed by,
leased by, or sold by the proposed Transferee in California over the
preceding five (5) year period, the dates of involvement by the proposed
Transferee with such projects and the success of the projects, such
certificate to be made by the manager, president or other Person with
appropriate authority from the proposed Transferee to do so; (G) in the
case of a Transfer of Control, a certificate by the proposed new
Controlling Person describing other real estate projects developed by,
leased by, or sold by the proposed new Controlling Person in California
over the preceding five (5) year period, the dates of involvement by the
proposed new Controlling Person with such projects and the success of the
projects, such certificates to be made by the manager, president or other
Person with appropriate authority from the proposed new Controlling
Person to do so; and (H) such other relevant information as the City may
request in its sole discretion in connection with its consent rights under
this Agreement(includingas described in Sections 4.6.1, 4.6.2, 8.5.1,
8.5.2, 8.5.3 and 8.6 of this Agreement), which may include evidence that
the proposed Transferee or proposed new Controlling Person has
sufficient financial capacity to perform the obligations of Developer under
this Agreement, without utilizing a Mortgage.
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(ii)Upon a Transfer of all of Developer’s interests in the
Property and in this Agreement, the proposed Transferee at the time of the
Transfer shall have expressly assumed for itself and its successors and
assigns, and for the benefit of the City, by instrument substantially in the
form and substance of the instrument attached hereto as Attachment 16A,
or otherwise in a form acceptable to the City in its sole discretion,
acknowledged and Recorded, all the rights and obligations of Developer
under this Agreement and the Other Agreements arising from and after the
date of such Transfer and the proposed Transferee shall agree to be subject
to all the conditions and restrictions to which Developer is subject by
reasonof this Agreement and the Other Agreements.
(iii)Upon a Transfer of all of Developer’s interests in the
Property and in this Agreement pursuant to this Section 2.2.3(a)and the
assumption in writing by a Transferee of all obligations under this
Agreement and the Other Agreements in accordance with Section
2.2.3(a)(ii), Developer shall be released from any of its obligations under
this Agreement and the Other Agreements arising from and after the date
of such Transfer; provided that such release shall not extendto the
following:(w)matters or circumstances (including any payment
obligations) which relate to or arose during the period that such transferor
was Developer hereunderand for the Additional Liability Period as
applicable;(x)the releases set forth inSection 4.5.2(f) or in the Other
Agreementsor the indemnities set forth in Sections 5.5, 8.12(e), 8.15,
8.16,10.1,10.2and 17.12.1for matters Accruing during the period that
such transferor was Developer hereunder and for the Additional Liability
Periodasapplicableand (y) any of Developer’s obligations under this
Agreement or the Other Agreements to the extent that the same arise prior
to the transfer date or subsequently if arising due to the acts or omissions
of Developer and/or any Developer Affiliate or Developer Representative;
and further, the Transfer of any Home to a Homebuyer shall not release
Developer from any of its obligations under this Agreement.
(b)The following shall apply with respect to Transfers of aportionof
Developer’s interests in the Property,the Projector this Agreement:
(i)Notwithstanding any other provision of this Agreement,
except as set forth in Section 2.2.2(d), (e) or (f), Section 16.3 or Section
16.4,Developer shall not Transferany partial interest in the Property, the
Project or this Agreementunlesssuch Transfer meets each of the
following requirementsor unless otherwise agreed by the City in its sole
Builder
discretion: (A) the Transferee shall be a homebuilder (“
Transferee
”); (B)the Transferred Property shall be Transferredto the
Builder Transferee in phased takedowns of not morethan fourteen (14)
Takedown
Lots, excluding Models (each a “”), and after the Transfer of
the first Takedown, subsequent Takedowns shall not be Transferred until
Builder Transferee shall have pulled building permits and commenced
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vertical construction activity on fifty percent (50%) or more of theLots
comprising the prior Takedown(the provisions of this clause (B)
Takedown Restrictions
comprising the “”); (C) Developer and Builder
Transfereeshall provide information indicating that the Builder Transferee
satisfiesthe requirements set forth in Section 2.2.3(a)(i)at least 20
Business Days prior to the Transfer;(D)Developer shall assign and
Builder Transfereeshall assume only those rights and obligations of
Developer related to the development of Vertical Improvements on Lots
within the TransferredProperty,and On-Lot Improvementscorresponding
to the Transferred Property,and those additional corresponding rights and
obligations under this Agreement and the Other Agreements;(E)Builder
Transferee, by instrument substantially in the form and substance of the
instrument attached hereto as Attachment 16 B, or otherwise in a form
acceptable to the City in its sole discretion, acknowledged and Recorded,
shall assume from and after the date of such Transfer the particular rights
of Developer under this Agreement and the Other Agreements with
respect to development of the Vertical Improvements on the Transferred
Property and On-Lot Improvementscorresponding to the Transferred
Property,as further provided in such Attachment 16B;(F)Builder
Transfereeshall have agreed in writing for the benefit of Developer and
the City that Builder Transferee’s development of the Property acquired
shall be in full compliance with the then-existing Entitlements, the
Approved Plans and the plans and specifications prepared by Developer,
without modification;(G) Developer shall not be released from the
obligations of Developer under this Agreement and theOther Agreements
even if any such obligations are expressly assumed by the Transferee
under the assignment instrument and all such obligations shall remain the
obligations of Developer;(H)Builder Transfereeshall have been
approved by the City in its sole discretion, and (I) there shall not be more
than one Builder Transferee with ownership in the Development Parcels at
any time.
(ii)The companies selected by the City as qualified developers
pursuant to the RFP shall be deemed to have been approved by the Cityas
Builder Transferees, so long as such companies shall have demonstrated to
the satisfaction of the City in its sole discretion that there have been no
material adverse changes in the financial condition of such companies
since the City’s prior review in connection with the RFP selection process.
(iii)For avoidance of doubt, it is hereby agreed that Builder
Transfereeshall be subject to all of the requirements of this Agreement,
including, without limitation, the restrictions on Mortgages setforth
herein, with respect to the portions of the Property acquired by it.
No Mortgages or Sale Leasebacks without Consent
2.2.4.. Prior to the
Recordation of the Certificate of Compliance, Developer shall not encumber the Property with
any Mortgage without the prior written consent of the City as set forth in Section 2.2.1 which
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approval may be granted or withheld in the sole and absolute discretion of the City. Any
encumbrance of the Development Parcels, or any portion thereof, in violation of this Section 2
shall be aprohibited Transfer or Transfer of Control and a Material Default by Developer,
subject to the provisions of Section 14.2.3. The City shall have no right to approve or disapprove
a Mortgage after the issuance of the Certificate of Compliance. Developer shall not assign the
Development Parcels or any portion thereof to a third party for purposes of a sale-leaseback
transaction. The provisions of this Section shall not apply with respect to any Lot or Home that
has been sold by Developer to a Homebuyer.
Bankruptcy
2.2.5.. The following shall be considered Transfers or Transfers of
Control which are prohibited without consent from the City, which may be granted or withheld
Developer Insolvency Event
in the City’s sole discretion (herein, a “”):
(a)If Developer is or becomes bankrupt or insolvent or if any
involuntary proceeding is brought against Developer (unless, in the case of a petition filed
against Developer, the same is dismissed within ninety (90) calendar days), or Developer makes
an assignment for the benefitof creditors, or institutes a proceeding under or otherwise seeks the
protection of federal or State bankruptcy or insolvency laws, including the filing of a petition for
voluntary bankruptcy or instituting a proceeding for reorganization or arrangement;
(b)If a writ of attachment or execution is levied on this Agreement or
on the Development Parcels, or on any portion thereof, where such writ is not discharged within
ninety (90) calendar days; or
(c)If, in any proceeding or action in which Developer is a party,a
receiver is appointed with authority to take possession of the Development Parcels, or any
portion thereof, where possession is not restored to Developer within ninety (90) calendar days.
City Estoppel
2.2.6.. From time to time (but in no event more than annually or
in connection with a Permitted Transfer, or a Transfer or Transfer of Control consented to by the
City in accordance with this Agreement) within twenty (20) calendar days of the City’s receipt of
a written request therefor, the City shall execute and deliver to Developer and any Transferee, a
City Estoppel, substantially in the form and substance of the City Estoppel attached hereto as
Attachment 6but with such modifications as are necessary in the City’s sole discretion to ensure
the accuratenessof the statements made therein.
Restrictions and Permitted Sale of Lots or Homes
2.2.7.. Notwithstanding
anything to the contrary set forth in this Agreement, recognizing that the Development Parcels
will be subdivided and developed with the intent to sell individual residential Lots and/or Homes
to Homebuyers, thegeneral prohibition against Transfer outlined herein shall not be applicable to
(a) the sale of individual residential Lots and/or Homes to Homebuyers, or (b) the transfer of
Common Area or Common AreaImprovements toahomeowners’association established
pursuant to the laws and regulations of the Statefor the management of a common area
Homeowners’Association
development (“”); provided, however, that sale or transfer of any Lot
or Home shall not be permitted unless and until such Lot or Home is authorized for sale pursuant
BRE
to State law, including regulations promulgated by theCalifornia Bureau of Real Estate (“”)
and the transfer of any Property to a Homeowners’Association shall not be permitted unless and
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until the Improvements proposed to be constructed thereon pursuant to the Scope of
Development,the Approved Plans and the CC&Rs have been Completed.
City Costs
2.2.8.. Developer shall promptly pay to the City all of the City’s
actual out of pocket third party expenses, including legal fees, and staff costs incurred with
respect to the preparation, review, and delivery of each City Estoppel and with respect to the
City’s review and approval (or disapproval) of each Transfer or Transfer of Control; provided
that such expenses, fees and costs shall not exceed $5,000with respect to any single City
Estoppel.
Remedies for Improper Transfers or Transfers of Control
2.3..
Without limiting the generality of the foregoing, a failure (a) by Developer to comply
withthe requirements of this Section 2 with respect to any Transfer or Transfer of Control or (b)
by any Transferee or Builder Transfereeto execute the Assignment and Assumption agreement
required by Section2.2.3, if applicable, shall in each case be a Material Default under this
Agreement, subject to the provisions of Section 14.2.3, but with no extension on account of
Force Majeure Delay and, in such event, the City shall have all remedies available to it at law
and in equity, including those specified in this Agreement and specifically including the right to
exercise the Right of Purchase and/or the Right of Reversion, as applicable, in accordance with
Section 16 of this Agreement.
Changes
2.4..
Developer shall promptly notify the City in the event that any of the following Persons
cease to be involved with the development of the Project: (a) any of the Key Employees, (b)
William Hezmalhalch Associates or Bassenian Lagoni Architects, Project Architects, (c) Valley
Crest Design Group, Landscape, or (d) Tait and Associates or Hunsaker and Associates,
Engineering.
Representations and Warranties
3..
Developer’s Representations and Warranties
3.1..
As an inducement to the City to enter into this Agreement and to perform its obligations
hereunder, Developer represents and warrants to the City as follows:
3.1.1.Developer has the necessary expertise, experience, financial experience,
financial capacity and qualifications and legal status necessary to perform as Developer pursuant
to this Agreement and to construct and complete the Project, and, without limiting the foregoing,
Developer is experienced in the development, management, and sale of single-family residential
projects of the size and type described in this Agreement and understands the process and
requirements associated with projects such as the Project described herein.
3.1.2.Developer’s acquisition of the Property, development of the Project and its
other undertakings pursuant to this Agreement are for the purpose of timely development of the
Development Parcels in accordance with the Schedule of Performance attached to this
Agreement and not for speculation or land holding.
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3.1.3.Developer isacorporation, duly incorporated, and validly existing and in
good standing under the laws of the State of Delaware, is duly qualified to do business and in
good standing in the State and in each other jurisdiction where the operation of its business or its
ownership of property or the performance of Developer’s obligations under this Agreement make
such qualification necessary.
3.1.4.Subject to all of the conditions set forth in this Agreement for the benefit
of Developer, Developer has (or will have prior to the date by which a particular step is required
to be taken or performance of a particular obligation is required to be commenced pursuant to
this Agreement or any Other Agreements) all requisite power and authority required to enter into
this Agreement and the instruments referenced in this Agreement, to consummate the transaction
contemplated hereby and to take any steps contemplated thereby or hereby, and to perform its
obligations hereunder and thereunder.
3.1.5.Developer has obtained (or will have obtained prior to the date by which a
particular step is required to be taken or performance of a particular obligation is required to be
commenced pursuant to this Agreement or any Other Agreements) all required consents in
connection with entering into this Agreement and the instruments and documents referenced in
this Agreement to which Developer is or shall be a party and the consummation of the
transactions contemplated hereby.
3.1.6.The individuals executing this Agreement and the individuals that will
execute the instruments referenced in this Agreement on behalf of Developer have, or will have
upon execution thereof, the legal power, right and actual authority to bind Developer to the terms
and conditions hereof and thereof.
3.1.7.This Agreement has been duly authorized, executed and delivered by
Developer and all documents required in this Agreement to be executed by Developer pursuant
to this Agreement shall be, at such time as they are required to be executed by Developer, duly
authorized, executed and delivered by Developer and are or shall be, at such time as the same are
required to be executed hereunder, valid, legally binding obligations of and enforceableagainst
Developer in accordance with their terms, except as enforceability may be limited by bankruptcy
laws or other similar laws affecting creditors’ rights.
3.1.8.Neither the execution or delivery of this Agreement or the documents
referenced in this Agreement, nor the incurring of the obligations set forth in this Agreement and
the certificates, declarations and other documents referenced in this Agreement, nor the
consummation of the transactions contemplated in this Agreement, nor compliance with the
terms of this Agreement and the documents referenced in this Agreement, will violate any
provision of law or any order of any court or Governmental Authority to which Developer is
subject or conflict with or result in the breach of any terms, conditions, or provisions of, or
constitute a default under any bond, note, or other evidence of indebtedness or any contract,
indenture, mortgage, deed of trust, loan,partnership agreement, lease or other agreements or
instruments to which Developer, or to the extent applicable, one of its members or partners are a
party and which affect the Property or the transactions contemplated by this Agreement.
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3.1.9.No attachments, execution proceedings, assignments of benefit to
creditors, bankruptcy, reorganization or other proceedings are pending or, to the best of
Developer’s knowledge, threatened against Developer, or to the extent applicable, its members
or partners.
3.1.10.Except for those representations and warranties of the City expressly set
forth in Sections 3.3 and 17.12 of this Agreement, Developer is relying solely upon its own
inspections and investigations in proceeding with this Agreement and the transactions
contemplated hereby, and is not relying on the accuracy or reliability of any information
provided to it by the City, on any oral or written representation or on any facts or conclusions of
law made by the City, or any of its elected and appointed officials, officials, employees, agents,
attorneys or representatives made in connection with this Agreement. In making such
investigation and assessment, Developer has been provided access to any persons, records or
other sources of information which it has deemed appropriate to review and it has thereafter
completed such investigation and assessment. Without limiting the generality of the foregoing
provisions, Developer acknowledges that the City has not made and will not make any
representations or warranties concerning the condition of the Property, the compliance or non-
compliance of the Property or any portion thereof with Environmental Laws or the existence or
non-existence of Hazardous Materials in relation to the Property or any portion thereof or
otherwise (except for those representations and warranties of the City set forth in Sections 3.3
and 17.12 of this Agreement).
3.1.11.To Developer’s knowledge, except as described on Attachment4, there
are no adverse conditions or circumstances, no pending or threatened legal proceedings or
litigation against Developer, nogovernmental action, and noother condition which could prevent
or materially impair Developer’s ability to carry out its obligations hereunder or to develop the
Property and the Project as contemplated by the terms of this Agreement.
3.1.12.Except as set forth in this Agreement, the DAand the ENA, Developer has
not paid orgiven, 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 architects, engineers and attorneys.
3.1.13.All reports, documents, instruments, information and forms of evidence
delivered by Developer to the City concerning or related to this Agreement and the transactions
contemplated hereby are, to Developer’s knowledge, accurate and correct and sufficiently
complete at the time of submission to give the City true and accurate knowledge of the subject
matter, and do not contain any material misrepresentation or omission.
3.1.14.As of the Close of Escrow, Developer will have the equity capital and
financial capacity required for Completion of the Development without requirement of third
party financing.
3.1.15.Developer does not have any contingent obligations or any other contracts
the performance or nonperformance of which could adversely affect the ability of Developer to
carry out its obligations hereunder.
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Subject to Section 7.2.2(l), Developer’s representations and warranties set forth in this
Section 3.1 shall be deemed to be restated at the Close of Escrow, and shall survive the Close of
Escrow until the earlier to occur of the following (a) termination of this Agreement or (b)
issuance of the Certificate of Compliance, and shall not be merged with the Quitclaim Deed. As
to Developer’s knowledge
used in Section 3, “” and similar phrases means the actual present
knowledge of theKey Employees and Developer’s General Counsel, John Babel (collectively,
Developer Knowledge Parties
the “”),in each case without any duty of inquiry.
Notwithstanding anything to the contrary contained herein, (i) none of the Developer Knowledge
Parties shall be personally liable for any inaccuracy or breach by Developer of the
representations and warranties contained in Section 3.1 or elsewhere in this Agreement and/or
any of the Other Agreements, and (ii) the City shall not be entitled to make a claim for a breach
of Developer’s representations and warranties if Developer had disclosed in writing facts to the
City indicating that the applicable representation and warranty was incorrect prior to (A) the
execution of this Agreement and the City proceeded with the execution of this Agreement, or (B)
the Close of Escrow and the City proceeded with the Close of Escrow, in either case in spite of
such inaccuracy.
Developer Covenants Regarding Representations and Warranties
3.2..
Developer shall promptly advise the City in writing if any of the Developer Knowledge
Parties becomes aware (without any duty of inquiry) that any representation or warranty made by
Developer in Section 3.1 is or becomes untrue in any material respect prior to the Close of
Escrow.
City Representations and Warranties
3.3..
As an inducement to Developer to enter into this Agreement and perform its obligations
hereunder, the City represents and warrants to Developer as follows:
3.3.1.The City is a municipal corporation incorporated within and existing
pursuant to the laws of the State.
3.3.2.Subject to all of the conditions set forth in this Agreement for the benefit
of the City, the City has (or will have prior to the date by which a particular step is required to be
taken or performance of a particular obligation is required to be commenced pursuant to this
Agreement or any Other Agreements) all requisite power and authority required to enter into this
Agreement and the instruments referenced in this Agreement, to consummate the transaction
contemplated hereby and to take any steps contemplated thereby or hereby, and to perform its
obligations hereunder and thereunder.
3.3.3.The City has obtained (or will have obtained prior to the date by which a
particular step is required to be taken or performance of a particular obligation is required to be
commenced pursuant to this Agreement or any Other Agreements) all required consents in
connection with entering into this Agreement and the instruments and documents referenced in
this Agreement to which the City is or shall be aparty and the consummation of the transactions
contemplated hereby.
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3.3.4.The individualsexecuting this Agreement and the individualsthat will
execute the instruments referenced in this Agreement on behalf of the City have, or will have
upon execution thereof, the legal power, right and actual authority to bind the City to the terms
and conditions hereof and thereof.
3.3.5.This Agreement has beenduly authorized, executed and delivered by the
City and all documents required in this Agreement to be executed by the City pursuant to this
Agreement shall be, at such time as they are required to be executed by the City, duly authorized,
executed and delivered by the City and are or shall be, at such time as the same are required to be
executed hereunder, valid, legally binding obligations of and enforceable against the City in
accordance with their terms, except as enforceability may be limited by bankruptcy laws or other
similar laws affecting creditors’ rights.
3.3.6.Neither the execution or delivery of this Agreement or thedocuments
referenced in this Agreement, nor the incurring of the obligations set forth in this Agreement,
and the certificates, declarations and other documents referenced in this Agreement, nor the
consummation of the transactions contemplated in this Agreement, nor compliance with the
terms of this Agreement and the documents referenced in this Agreement, will violate any
provision of law, any order of any court or Governmental Authorities to which the City is subject
or conflict with or result in the breach of any terms, conditions, or provisions of, or constitute a
default under any bond, note or other evidence of indebtedness or any contract, indenture,
mortgage, deed of trust, loan, partnership agreement, lease or other agreements or instruments to
which the City is a party and which affect any of the Property or the transactions contemplated
by this Agreement, except as set forth on Attachment 4.
3.3.7.There are no legal proceedings either pending or, to the knowledge of the
City Representatives, threatened, to which the City is or may be made a party, or to which the
Property, is or may become subject, which has not been disclosed in the documents submitted to
Developer and that could materially affect the ability of the City to carry out its obligations
hereunder or that would affect the Property after the Close of Escrow.
Subject to Section 7.2.1(i),theCity’s representations and warranties set forth in this
Section3.3 shall be deemed to be restated at the Close of Escrow, and shall survive the Close of
Escrow until the earlier to occur of the following: (a) termination of this Agreementor (b)
issuance of the Certificate of Complianceand shall not be merged with the Quitclaim Deed. As
to the City’s knowledge
used in Section 3, “” and similar phrases means the actual present
City
knowledge of Jeffrey Parker, David Kendig, John Buchanan and Ken Nishikawa (the “
Representatives
”) without any duty of inquiry. Notwithstanding anything to the contrary
contained herein, (i) none of the City Representatives shall be personally liable for any
inaccuracy or breach by the City of the representations and warranties contained in Section 3.3or
elsewhere in this Agreement, any of the Other Agreements, and (ii) Developer shall not be
entitled to make a claim for a breach of the City’s representations and warranties if the City had
disclosed in writing facts to Developer indicating that the applicable representation and warranty
was incorrect prior to (A) the execution of this Agreement and Developer proceeded with the
execution of this Agreement, or (B) Close of Escrow and Developer proceeded with the Close of
Escrow, in either case in spite of such inaccuracy.
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City Covenants Regarding Representations and Warranties
3.4..
The City shall promptly advise Developer in writing if any of the City Representatives
becomes aware (without any duty of inquiry) that any representation or warranty made by the
City in Section 3.3 is or becomes untrue in any material respect prior to the Close ofEscrow.
Conveyance of Property from City to Developer
4..
Conveyance of Property.
4.1.
Subject to the terms and conditions set forth in this Agreement, including the satisfaction
of the Closing Conditions set forth in Section7 or elsewhere in this Agreement, the City agrees
to sell to Developer and Developer agrees to purchase from the City the Development Parcels,
together with all existing improvements, if any, presently located on the Development Parcels,
all appurtenances pertaining to the Development Parcels, all permits, licenses, approvals and
authorizations issued by any Governmental Authority relating to the Development Parcels and all
of City’s right, title and interest in, to and arising out of the Intangible Property (collectively
Property
referred to in this Agreement as the “”), subject to all Permitted Exceptions; provided,
however that City’s assignment of its rights to enforce the Navy Responsibilities against the
Navy shall be made to Developer on a non-exclusive basis and the City and Developer may each
enforce the Navy Responsibilities as their interests may appear.Notwithstanding the foregoing,
nothing set forth in this Agreement shall preclude the City or any insurer, on a non-exclusive
basis,from enforcing the Navy Responsibilities against the Navy with respect to Tustin Legacy
other than the Propertyor, with respect to the Property for matters Accruing prior to Close of
Escrow.At the Close of Escrow, the City shall convey to Developer by Quitclaim Deed fee title
to the Property. Notwithstanding the foregoing:
Property
(a)the term “” shall exclude the following rights and interest which
shall be explicitly reserved to the City:
(i)Any and all oil, oil rights, minerals, mineral rights, natural gas,
natural gas rights and other hydrocarbon by whatsoever name known, geothermal
steam and all products derived from any of the foregoing, that may be within or
under the Development Parcels together with the perpetual right of drilling,
mining, exploring for and storing in and removing the same from the
Development Parcels or any other land, including the right to whipstock or
directionally drill and mine from lands other than the Development Parcels, oil or
gas wells, tunnels and shafts into, through or across the subsurface of the
Development Parcels and to bottom such whipstocked or directionally drilled
wells, tunnels and shafts under and beneath or beyond the exterior limits thereof,
and to re-drill, re-tunnel, equip, maintain, repair, deepen and operate any such
well or mines; but without, however, the right to enter upon or use the surface of
the Development Parcels in the exercise of such rights or otherwise adversely
affect the use or operation of the Development Parcels as anticipated by this
Agreement or the structural integrity of any improvements on the Development
Parcels; and
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(ii)Any and all water, water rights or interests therein appurtenant or
relating to the Development Parcels or owned or used by the City in connection
with or with respect to the Development Parcels no matter how acquired by the
City, whether such water rights shall be riparian, overlying, appropriative, littoral,
percolating, prescriptive, adjudicated, statutory or contractual, together with the
perpetual right and power to explore, drill, re-drill and remove the same from or
in the Development Parcels, to store the same beneath the surface of the
Development Parcels and to divert or otherwise utilize such water, rights or
interests on any other property owned or leased by the City; but without, however,
the right to enter upon or use the surface of the Development Parcels in the
exercise of such rights or otherwise adversely affect the use or operation of the
Development Parcels as anticipated by this Agreement or the structural integrity
of any improvements on the DevelopmentParcels; and
(iii)Those excess development rights remaining after deducting the
number of residential unitsallocated to the Development Parcels (anticipated to
be 375 residentialunits) from the total Specific Plan Planning Area 15
authorization of 1,214 residentialunits.The residential units allocated to the
Development Parcels shall be equal to the number of Lots on the Final Mapand
Developer shall only be entitled to develop residential units equal to the number
of Lots shown on the Final Map;except tothe extent any of such rights were
conveyed by the City to third parties prior to the Effective Date, the Cityshall
retain all residential units and all development rights associated with Specific Plan
Planning Area 15 above the number of Lots shown on the Final Map andsuch
residential units and development rights shall be freely transferable by the City
throughout Tustin Legacy.
(b)the reservation by the City of the rights and interests in this Section4.1
shall not be deemed to limit Developer’s right toconstruct foundations and other subsurface
improvements for the purpose of constructing the Project, and otherwise engage in subsurface
construction activity in order to construct the Project.
Purchase Price
4.2..
Base Purchase Price
4.2.1.. As consideration for the sale of the Development
Parcels by the City to Developer, Developer shall pay to the City as the purchase price for the
Base
Development Parcels, the sum of Fifty Six Million Dollars ($56,000,000.00)(the “
Purchase Price
”),payable at the Close of Escrow.
Profit Participation Price
4.2.2.. As additional consideration for the sale of
the Property by the City to Developer, in addition to the Base Purchase Price, Developer shall
Profit
pay a percentage of the profits from the sale of the Homes within the Property (the“
Participation Price
”) upon the terms and conditions as set forth in that certain Profit
Profit Participation
Participation Agreement attached hereto as Attachment 14(the “
Agreement
”).
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Payment of Purchase Price
4.3..
Deposit
4.3.1.. As a condition to execution of this Agreement by the City,
Purchase Price Deposit
Developer shall deliver an earnest money deposit (“”) of FOUR
MILLION DOLLARS ($4,000,000) to Escrow Holdernot later than five (5) Business Days after
the later of (a) approval by the City Councilof this Agreement or (b) approval by the City
Council of the DA. The Purchase Price Deposit plus accrued interest shall constitute security to
the City for the Close of Escrow and shall be credited against the Base Purchase Price at the
Close of Escrow. The Purchase Price Deposit shall be held by Escrow Holder in Escrow in an
interest-bearing account approved by the City and Developer and disposed of in accordance with
the terms of this Agreement.
Application of Purchase Price Deposit
4.3.2.. Unless Developer has timely
provided a Diligence Termination Notice in accordance with Section 5.1, after expiration of the
Due Diligence Period, the Purchase Price Deposit shall be nonrefundable except as otherwise
expressly provided in this Agreement and shall be applied to the Base Purchase Price as set forth
in Section 4.3.3, or shall be liquidated damages to the City in the event of certain Defaults by
Developer as further set forth in Sections 14 and 15 of this Agreement.
Payment of the Balance of the Base PurchasePrice and Other
4.3.3.
Amounts Due at Close of Escrow
.No later than one (1) Business Day prior to the Close of
Developer Closing
Escrow, Developer shall deposit with Escrow Holder an amount (the “
Payment
”) which shall, be equal to: (a) the Base Purchase Priceless the Purchase Price Deposit
(plusaccrued interest) plus(b) such additional amount as is necessary to cover all outstanding
ENA Transaction Expenses and City Transaction Expenses and all closing costs to be paid by
Developer pursuant to Section 7.4.1(b) and (c) and Section 7.4.4 for the Close of Escrow, as
adjusted for any net credits or debits to the City for closing costs and/or prorations in accordance
with Section 7.4.1(a) and (c) and Section 7.4.4 for the Close of Escrow.
Payments in ImmediatelyAvailable Funds
4.3.4.. Funds delivered to the City
or Escrow Holder under this Agreement shall be in the form of cash, wire transfer (to such
account of the City or Escrow Holder as Escrow Holder notifies Developer in writing), or by
cashier’s check drawn on good and sufficient funds on a federally chartered bank and made
payable to the order of City or Escrow Holder, as the case may be.
Escrow and Joint Escrow Instructions
4.4..
Upon payment of the Deposit and execution of this Agreement by the City, the City and
Developer shall each deliver three executed original counterparts of this Agreement to Escrow
Holderwithin the time period specified in the Pre-Closing Schedule. For purposes of this
Opening of Escrow
Agreement, the “” shall be the date that Escrow Holder receives executed
original counterparts to this Agreement signed by Developer and the City. Upon the written
acceptance of this Agreement by Escrow Holder, this Agreement shall constitute the joint escrow
Escrow
instructions of Developer and the City to Escrow Holder to open an escrow (the “”).
Upon Escrow Holder’s receipt of the Purchase Price Deposit and Escrow Holder’s written
acceptance of this Agreement, Escrow Holder is authorized to act in accordance with the terms
of this Agreement. Developer and the City shall execute Escrow Holder’s general escrow
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instructions upon request, with such modifications thereto as Developer and the City may
reasonably require; provided, however, if there is any conflict or inconsistency between such
general escrow instructions and this Agreement, this Agreement shall control. Escrow Holder
shall not prepare any further escrow instruction restating or amending this Agreement unless
specifically so instructed by the City and Developer in writing. Any supplemental escrow
instructions must be in writing and signed by the City and Developer and accepted by the Escrow
Holder to be effective.
Investigation; Property Conveyed “As-Is.”
4.5.
Investigation
4.5.1..
(a)Developer shall have the right to conduct Developer’s own
investigation of the Property pursuant to Section 5.1 of this Agreement. If Developer proceeds
to the Close of Escrow, Developer represents and warrants to the City that Developer will have
satisfied itself that it has determined that all matters related to the Property and the Project are
acceptable to Developer, including, the state of title (subject only to the Permitted Exceptions),
the physical condition thereof, the physical condition of structures, if any, located upon the
Development Parcels and, as applicable, the accessibility and location of utilities, and all
mechanical, plumbing, sewage, and electrical systems located therein, suitability of soils,
environmental and other investigations regarding the Property. Prior to the expiration of the Due
Diligence Period, Developer will have reviewed all items that in Developer’s sole judgment
affect or influence Developer’s purchase and use of the Property and Developer’s willingness to
consummate the transactions described by this Agreement.
(b)Developer acknowledges and agrees that, as of the Close of
Escrow:
(i)Its determination to enter into this Agreement constitutes
Developer’s agreement that Developer, in consummating the transactions
described in this Agreement:(A) has been given the opportunity to
inspect the Property and to review the information and documentation
provided by the City to Developer and affecting the Property, including
the environmental condition of the Property, or otherwise obtained by
Developer in connection with its due diligence of the Property,and is
relying solely on its own investigation of the Property, including such
investigation prior to execution of this Agreement, and review of such
information and documentation in determining the physical, economic and
legal condition of the Property, and not on any information, representation
or warranty provided by the City or any agents or representatives of the
City; (B) has performed its own assessment of the Property, including the
environmental condition of the Property, the presence of Hazardous
Materials on the Property, the suitability of the soil for improvements to
be constructed, the implications of land use restrictions on the
development plan for the Project and the Property and the consequences of
any subsequently discovered contamination on or adjacent to the Property,
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and(C) has been provided with access to all information in the possession
of the City which it has requested.
(ii)Information provided to Developer by or on behalf of the
City with respect to the Property was obtained from a variety of sources
and that the City has not made any independent investigation or
verification of such information and makes no representations as to the
accuracy or completeness of such information; and Developer is satisfied
with the nature and extent of its permissible investigation of the physical
condition and other matters relating to the Property and is willing to
consummate the transactions described by this Agreement.
(iii)Without limiting the generality of the foregoing, Developer
acknowledges and agrees that (A) it has been provided with access to (x)
all environmental reports and statements listed on Attachment10and all
reports either attached to or referenced in the Memorandum of Agreement
and Federal Deed, (y) the FOST and (z) the Environmental Baseline
EBS
Survey (the “”) which is incorporated into the FOST by reference; (B)
it shall perform its own assessment of the environmental condition of the
Property, the presence of Hazardous Materials on the Property, the
suitability of the soil for improvements to be constructed, the implications
of the land use restrictions on the development plan for the Project and the
Property and the consequences of any subsequently discovered
contamination on the Property; and (C)it shall review the Navy produced
oridentified documentation, including that listed on Attachment10,
reflecting the Navy’s knowledge of the environmental condition of the
Property.
AS-IS; WHERE-IS
4.5.2..
No Representations or Warranties
(a). Developer recognizes that
the City would not sell the Property except on an “AS, IS, WHERE IS, WITH ALL FAULTS”
basis, and Developer acknowledges that the City has made no representations or warranties of
any kind whatsoever (excepting only those representations and warranties of the City expressly
set forth in Section 3.3 of this Agreement), either express or implied in connection with any
matters with respect to the Property or any portion thereof.
Acknowledgement
(b). Developer’s determination to enter into this
Agreement constitutes Developer’s agreement that Developer, in consummating the transactions
described in this Agreement is buying the Property in an “AS IS, WHERE IS, WITH ALL
FAULTS” condition, in its present state and condition and with all faults, if any. Without
limiting the generality of the foregoing provisions, Developer further acknowledges and agrees
that, except as otherwise specifically provided in Sections 3.3, 8.10and 17.12 of this Agreement,
City makes no representations, warranties, assurances or guaranties of any kind or character in
connection with the transaction contemplated by this Agreement, whether express or implied,
oral or written, past, present or future, whether by the City or any of its agents, elected or
appointed officials, representatives or employees, of concerning or with respect to:
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(i)the value of the Property or the income to be derived from
the Property;
(ii)the existence or nonexistence of any liens, easements,
covenants, conditions, restrictions, claims or encumbrances affecting the
Property;
(iii)the suitability of the Property for any and all future
development, uses and activities which Developer may conduct thereon,
including the development of the Project described in this Agreement;
(iv)except as set forth in Section 8.10,the ability of the City or
any third party to complete, or likelihood of the completion of, any of the
improvements and infrastructure described by the General Plan, the Reuse
Plan, the Specific Plan, the Tustin Legacy Backbone Infrastructure
Program or any other plan or policy of the City or any other Governmental
Authorities;
(v)the compliance by the City or any third party with respect
to the Reuse Plan, the General Plan, the Specific Plan, the Special
Restrictions applicable to the Property or the special restrictions or other
covenants and agreements applicable to other propertyat Tustin Legacy,
the CC&Rs or any other agreement or governmental restriction or plan
affecting Tustin Legacy;
(vi)the habitability, merchantability or fitness for a particular
purpose of the Property;
(vii)the manner, quality, state of repair or lack of repair of the
Property;
(viii)the nature, quality or condition of the Property including
water, soil and geology;
(ix)the compliance of or by the Property and/or its operation in
accordance with anyof the Entitlements orany Governmental
Requirement,including the National Environmental Policy Act, CEQA
and the Americans with Disabilities Act;
(x)the manner or quality of the construction or materials, if
any, incorporated into the Property;
(xi)the presence or absence of Hazardous Materials, including
asbestos or lead paint at, on, under, or adjacent to the Property;
(xii)the content, completeness or accuracy of the information,
documentation, studies, reports, surveys and other materials delivered to
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Developer in connection with the review of the Property and the
transactions contemplated in this Agreement;
(xiii)the conformity of the existing improvements on the
Property, if any, to any plans or specifications for the Property;
(xiv)compliance of the Property with past, current or future
Governmental Requirements relating to zoning, subdivision, planning,
building, fire, safety, health or Environmental Matters and/or covenants,
conditions, restrictions or deed restrictions;
(xv)the deficiency of any undershoring or of any drainageto on
or from the Property or any other portionof Tustin Legacy;
(xvi)the fact that all or a portion of the Property may be located
on or near an earthquake fault line or falls within an earthquake fault zone
established under the Alquist-Priolo Earthquake Zone Act, California
Public Resources Code Sections2621-2630 or within a seismic hazard
zone established under the Seismic Hazards Mapping Act, California
Public Resources Code, Sections2690-2699.6 and Sections3720-3725;
(xvii)the existence or lack of vested land use, zoning or building
entitlements affecting the Property;
(xviii)the construction or lack of construction of Tustin Legacy or
if constructed, the construction of Tustin Legacy in accordance with
design guidelines, plans and specifications previously or to be prepared
therefor;
(xix)the contents of the Memorandum of Agreement, the
Federal Deed, the Base Closure Law and the FOST; and
(xx)any other matters.
Environmental Condition of the Property; Restrictions
(c).
Without limiting the generality of the foregoing provisions, the City makes no representation or
warranty as to the environmental condition of the Property or any portion thereof, the Navy’s
obligations with respect to the environmental condition of the Property or the adequacy or
accuracy of any environmental report that has been rendered. Developer acknowledges and
agrees that (i)there may be some residual contamination on the Property as a result of Navy
historic activities; (ii)the Navy has agreed to accept certain limited responsibility for any
contamination it caused, including any contamination discovered after transfer from the Navy, in
accordance with existing Governmental Requirements including the National Defense
Authorization Act For Fiscal Year 1993 as amended (Public Law No. 102-434) Section 330 and
Section 120(h) of the Comprehensive Environmental Response, Compensation, and Liability
Navy Responsibilities
Act, 42 U.S.C. § 9620(h) (“”); and (iii)based on that certain Covenant to
Restrict Use of Property Environmental Restriction between the Navy, DTSC and the California
Regional Water Quality Control Board, Santa Ana Region, Recorded on July 20, 2006, as
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Instrument Number 2006000483641, the deed restrictions contained in the Federal Deed are
binding upon successors and assigns of the City and are enforceable by DTSC pursuant to a
conveyed property right from the Navy to DTSC.
Federal Deed and Memorandum of Agreement
(d). Developer
acknowledges and agrees that the purchase of the Property is subject to the terms and conditions
expressly set forth in the Memorandum of Agreement, the Federal Deed and the Permitted
Exceptions. From and after the Close of Escrow, Developer agrees to assume and faithfully
perform any covenants running with the land acquired and all obligations set forth in the Federal
Deed as obligations to be performed by “Grantee or itssuccessors or assigns.”
No Unauthorized Representations
(e). No Person acting on behalf
of the City is authorized to make, and by execution hereof, Developer acknowledges that no
Person has made, any representation, agreement, statement, warranty, guaranteeor promise
regarding the Property, the Project or the transactions contemplated in this Agreement or the
past, present or future zoning, land use entitlements, construction, physical condition, presence
or extent of Hazardous Materials or other status of the Property except as may be expressly set
forth in this Agreement or in any of the Other Agreements. No representation, warranty,
agreement, statement, guarantee or promise, if any, made by any Person acting on behalf of the
City that is not contained in this Agreement or in any of the Other Agreements will be valid or
binding on the City. Nothing in this Section is intended to affect in any manner the validity of
the Entitlements and Development Permits obtained by Developer with respect to the Property.
Release
(f). Developer, on behalf of itself and each Successor Owner
and every Person claiming by, through or under Developer or any Successor Owner (each a
Releasing Party
“”), hereby waives, as of the Effective Date, and agrees to waive, as of the Close
of Escrow, the right of each Releasing Party to recover from, and fully and irrevocably releases,
the City and its elected and appointed officials, employees, agents, attorneys, affiliates,
Released
representatives, consultants, contractors, successors and assigns (individually, a “
PartyReleased Parties
” and collectively, the “”) from any and all Claims that Developer or any
Releasing Party may now have or hereafter suffer or acquire arising from or related to: (i)any
Due Diligence Information, (ii) any condition of the Property or any current or future
improvement thereon, known or unknown by any Releasing Party or any Released Party,
including as to the extent or effect of any grading of the Development Parcels; (iii) any
construction defects, errors, omissionsor other conditions, latent or otherwise;(iv)economic and
legal conditions on or affecting the Property or any improvements thereon; (v) Environmental
Matters,including the existence, Release, threatened Release, presence, storage, treatment,
transportation or disposal of any Hazardous Materials at any time on, in, under, or from, the
Property or any current or future improvement thereon or any portion thereof; (vi)Claims of or
acts or omissionsto act of any Governmental Authority or any other third party arising from or
related to any actual, threatened, or suspected Release of a Hazardous Material on, in, under, or
fromorabout the Property or any current or future improvement thereon, including any
Investigation or Remediation at or about the Property or any current or future improvement
thereon; and/or (vii)arising from the Tustin Legacy Backbone Infrastructure Program, any
community facilities district or assessment district the cost or extent thereof, or the amount of the
Project Fair ShareContribution or any community facilities district or assessment district
assessment against the Development Parcels described in this Agreementor the DA; provided
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that the foregoing release by the Releasing Parties shall not extend to the extent of (A) any
breach by the City of any of the representations or warranties of the City set forth in Sections 3.3
or 17.12 of this Agreement, (B) any breach by the City of any of the covenants or obligations set
forth in this Agreement or any Other Agreement, (C) any Claim that is the result of the gross
negligence, willful misconduct or fraud of the City or any of the Released Parties, (D) any
actions of the City or any of the Released Parties which occur following the Close of Escrow
with respect to the Property, or (E) any other Claims against City relating to or arising out of tort
Claims brought by third parties against Developer, to the extent such claims are based upon the
Active Negligence of the City or any Released Parties and Accruingprior to the Close of
Escrow; provided that the exceptions in clause (C) and (E) above shall not apply with respect to
any matter for which the City is indemnified pursuant to Section 5.5 or Section 10.2. This
release includes Claims of which Developer is presently unaware or which Developer does not
presently suspect to exist which, if known by Developer, would materially affect Developer’s
release of the Released Parties. Developer specifically waives the provision of California Civil
Code Section1542, which provides as follows:
“A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS
WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT
TO EXIST IN HIS OR HER FAVOR AT THE TIME OF
EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM
OR HER MUST HAVE MATERIALLY AFFECTED HIS OR
HER SETTLEMENT WITH THE DEBTOR.”
In this connection and to the extent permitted by law, Developer on behalf of itself, and the other
Releasing Parties hereby agrees that (x) it realizes and acknowledges that factual matters now
unknown to it may have given or may hereafter give rise to Claims or controversies which are
presently unknown, unanticipated and unsuspected, (y) the waivers and releases in this Section
4.5.2(f)have been negotiated and agreed upon in light of that realization and (z) Developer, on
behalf of itself and the other Releasing Parties, nevertheless hereby intends to release, discharge
and acquit the Released Parties from any such unknown Claims and controversies to the extent
set forth above.
BY INITIALING BELOW, DEVELOPER ACKNOWLEDGES
THAT (A)IT HAS READ AND FULLY UNDERSTANDS THE
PROVISIONS OF THIS SECTION, (B)IT HAS HAD THE
CHANCE TO ASK QUESTIONS OF ITS COUNSEL ABOUT
ITS MEANING AND SIGNIFICANCE, AND (C)IT HAS
ACCEPTED AND AGREED TO THE TERMS SET FORTH IN
THIS SECTION.
_____________________________________________
CITY’S INITIALSDEVELOPER’S INITIALS
This release shall run with the land for the benefit of the City Benefited Property and the City
and each Successor Owner owning all or any portion of such City Benefited Property from and
after the acquisition of the Development Parcels by Developer, burdening the Development
Parcels and Developer and the Successor Owners owning all or any portion of the Development
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Parcels and all Persons claiming by, through or under Developer or any Successor Owner of the
Development Parcels or such portion thereof and to further evidence its effectiveness with
respect to Developer and the Successor Owners of the Development Parcels, shall be included in
its entirety in the Quitclaim Deed.
(g)The provisions of this Section 4.5.2 shall survive the Close of
Escrow and the termination of this Agreement and shall not be merged with the Quitclaim Deed.
Covenants; Preconditions to Close of Escrow
4.6..
The following are covenants of Developerand conditions precedent to the Close of
Escrow for the benefit of the City as further described in this Section and in Section 7.2.2(k),and
shall be satisfied by Developer not later than the times specified for such conditions in the Pre-
Closing Schedule. Only the City has the right to waive any of the conditions in this Section 4.6.
Financing Plan
4.6.1.. On or before the Effective Date, Developer shall provide
the City with a financing plan that includes: (a) a Project budget; (b) a cash flow projection for
operation of the Project; (c) a cost breakdown for development based upon government permits
and approvals and any design documents; (d) a sources and uses table identifying the proposed
use of each source of funding for the Project during the construction period; and (e) evidence
reasonably satisfactory to the City that Developer has sufficient additional funds available and is
able to commit such funds to cover the difference, if any, between costs of development of the
Financing Plan
Project and the amount available to Developer from external sources (“”).
Additional Assurances
4.6.2.. At least thirty (30) calendar days prior to Close
of Escrow, Developer shall submit an update of the Financing Plan to the City, for the purposes
of confirming that Developer has sufficient funds for construction of the Project and for its
operation consistent with the terms of this Agreement and without a Mortgage. If the City is not
reasonably satisfied with the financial status of Developer following review of the Financing
Plan, the City shall be entitled to obtain, as applicable,the financial information of other
members and/or partners of the proposed development entity (and their respective members,
partners, shareholders and/or other owners at each tier until substantial assets are identified) and
such other financial information as the City may request to demonstrate Developer’s financial
capacity and capability to perform its obligations under this Agreement. Such information shall
be subject to the confidentiality provisions of Section 17.24.
City Approvals
4.6.3.. Developer shall have applied for and obtained all
Entitlements.Developer's application for the Entitlements shall be consistent with the Scope of
Development and the terms and conditions of this Agreement.
Insurance
4.6.4.. Prior to or concurrently with the execution of this Agreement
by Developer, Developer shall have obtained and delivered to the City a binder or certificate
evidencing the insurance required by Section11 effective upon the mutual execution of this
Agreement by Developer and the City.
Declaration of Ownership; Additional Documentation
4.6.5.. Prior to or
concurrently with the execution of this Agreement by Developer, Developer shall have delivered
to the City a declaration certified by the general counselof Developer that the following
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documentation submitted by Developer to the City prior to the Effective Date is true and correct:
copies of (a)a certificate of incorporation, California foreign entity registration, and a fully
executed bylaws (including any amendments thereto) of Developer; (b)copies of all resolutions
or other necessary actions taken by such entity to authorize the execution of this Agreement and
any other documents or instruments required by this Agreement; (c)certificates of good
standing issued by the Delaware Secretary of State and by the California Secretary of State
within thirty (30) calendar days of the Effective Date; and (d)a copy of any Fictitious Business
Name Statement if any, as published and filed with the Clerk ofOrange County.
Developer’s Due Diligence Investigation
5..
Due Diligence Period
5.1..
Developer acknowledges that while the City has been negotiating this Agreement with
Developer, Developer has had extensive access to the Property within which to undertake such
physical inspections and other investigations of, and inquiries concerning, the Property as may
be necessary to allow Developer to evaluate the physical characteristics of the Property, as well
as such other matters as may be deemed by Developer to be reasonably necessary to generally
evaluate the Property and determine the feasibility and advisability of Developer’s purchase and
redevelopment of the Property with the Project. In addition to the due diligence investigation
previously conducted by Developer, Developer shall have an additional period of time as
identified herein to undertake specific additional inspections and investigations as are necessary
and specifically permitted herein to allow Developer to continue to evaluate the feasibility and
advisability of Developer’s purchase of the Property. Developer’s obligation to consummate this
transaction shall be contingent upon Developer’s satisfaction, in Developer’s sole discretion, of
the results of such inspection, examination and other due diligence with regard to the Property
and its suitability for construction of the Project as Developer may elect to conduct during the
period commencing on the Effective Date and ending on the date which is sixty (60) calendar
Due Diligence Period
days following the Effective Date at4:00 P.M. Pacific Time (the “”).
Developer acknowledges and agrees that the Due Diligence Period is adequate time to complete
such investigation. As further described in Section5.3of this Agreement, Developer may give
Diligence Termination Notice
City written notice (the “”) on or before the end of the Due
Diligence Period stating whether Developer elects to terminate this Agreement or waive its due
diligence contingency and proceed to the Close of Escrow, subject to the other terms and
conditions set forth in this Agreement.
No Financing Contingency
5.2..
Developer represents and warrants that it has examined its ability to purchase the
Property and to develop the Project, including Developer’s ability to finance such construction
without the requirement for any Mortgage. Accordingly, Developer acknowledges and agrees
that Developer’s purchase of the Property is subject to no financing contingency whatsoever with
respect to either private or public financing and that its acquisition of third party financing for the
Project is not a condition precedent to Developer’s obligation to purchase the Property or of its
ability to fund construction of the Project.
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Termination of Agreement
5.3..
If Developer fails to give the Diligence Termination Notice on or before the end of the
Due Diligence Period, then Developer will be deemed to have disapproved the Due Diligence
matters and shall be deemed to have elected to terminate this Agreement pursuant to Section 5.1.
If Developer elects to terminate this Agreement on or before the end of the Due Diligence Period
(or is deemed to have elected to terminate this Agreement upon the expiration of the Due
Diligence Period) pursuant to its termination rights set forth in Section 5.1 or 6.3, this Agreement
shall automatically terminate on the date of such election or deemed election, as applicable, and
thereafter, and in accordance with Section 15.1.3, neither Party shall have any further obligations
under this Agreement (subject to the provisions that expressly survive the termination of this
Agreement); provided that Escrow Holder shall return the Purchase Price Deposit to Developer,
less Developer’s share of any title and escrow cancellation fees of Escrow Holder and
outstanding ENA Transaction Costs and City Transaction Costs to the extent not covered by the
City Costs Deposit, if any.
Limited License
5.4..
The City grants to Developer for use by Developer and its officers, directors, employees,
agents, representatives, contractors, andother Persons accessing the Development Parcels by,
Developer
through or with the permission or under the direction or auspices of Developer (the “
Representatives
”) a limited and revocable license to enter upon the Development Parcels for
purposes of (a) conducting Developer’s due diligence inspection and/or (b) obtaining data and
making surveys and tests necessary to carry out this Agreement, provided that, prior to the
effectiveness of such license, Developer shall: (i)deliver to the City written evidence that
Developer has procured the insurance required under Section 11.1; (ii) give the City twenty-four
(24) hours telephonic, electronic mail or written notice of any intended access which involves
work on the Development Parcels or may result in any impairment of the use of the Property or
any portion thereof or any adjacent property by any then-current owners, occupants, or
contractors; (iii) access the Property in a safe manner; (iv) conduct no environmental testing,
sampling, invasive testing, or boring without the written consent of the City; (v) allow no
dangerous or hazardous condition to be created or caused on the Property; (vi) comply with all
Governmental Requirements and obtain all permits required in connection with such access; (vii)
conduct inspections and testing during normal business hours and only after obtaining the City’s
prior consent, which shall not be unreasonably withheld. This limited license shall commence on
the Effective Date, may be revoked by the City during the continuationof any Default by
Developer, or upon termination of this Agreement by any Party, and shall be automatically
revoked and terminated upon the earlier to occur of a delivery by Developer of a Diligence
Termination Noticeor the Close of Escrow.
Indemnity
5.5..
Developer hereby agrees to protect, indemnify, defendand hold harmless the City
Indemnified Parties from and against any and all Claims to the extent arising from or related to
(a) the actsor omissions to act of Developer or the Developer Representatives arising from the
presence,activities or work on or use of the Development Parcels or from the exercise of the
license provided in Section 5.4 by Developer or the Developer Representatives, including with
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respect to any inspections, surveys, tests, Investigations and studies carried out by Developer or
the Developer Representatives on the Development Parcelsprior to the Close of Escrow,(b)
entry onto the Development Parcels by Developer or the Developer Representatives in
connection with this Agreement, and(c) bodily injury to or death of any person (including any
employee or contractor of the City Indemnified Parties) or damage to or loss of use of property
resulting from such acts or omissions of Developer or any Developer’s Representative, and in
each case whether occurring prior to or following the Effective Date; provided that the foregoing
indemnity shall not apply to the extent of (i) the gross negligence, willful misconduct or fraud of
City or any City Indemnified Party,(ii) Hazardous Materials existing on the Development
Parcels prior to Close of Escrow unless such Hazardous Materials condition is exacerbated by, or
any Release causedby, negligent actsof Developer or any Developer’s Representative, or (iii)
the Active Negligenceof the City or the City’s employees, contractors or consultantsarising
from the presence,activities or work on or use of the Development Parcelsprior to the Close of
Escrow.Developer shall keep the Development Parcels free and clear of any mechanics’ liens or
materialmen’s liens related to Developer’s inspection and/or Investigation of the Property.
Subject to Section 9.7 of this Agreement, the indemnification by Developer set forth in this
Section5.5 shall survive (a) the Close of Escrow and shall not be merged intothe Quitclaim
Deed, and (b) any termination of this Agreement prior to Close of Escrow.
Review of Certain Records and Materials
5.6..
The City shall, within ten (10) Business Days of the Effective Date, provide Developer
with copies of all City-produced plans, reports, studies, investigations and other materials the
City may have in its possession that are pertinent to the Property and/or development of the
Projectand not previously delivered; provided that the City makes no representation, warranty or
guaranty regarding the completeness or accuracy of such plans, reports, studies, investigations
and other materials. Developer shall also have the right to enter the City’s offices to review files
and materials, including the right to examine those books, records and files of the City relating to
the environmental and other condition of the Property which the City determines in its sole
discretion are not subject to attorney-client privilege or other privilege or disclosure rules. The
City agrees to make all such books, records, and files available to Developer and Developer’s
attorneys, accountants, and other representatives at City Hall any time during business hours on
Business Days upon reasonable notice from Developer.
Communications with City and Third Parties
5.7..
From and after the Effective Date, communications with the City by Developer and the
Developer Representatives shall be directly with the City Manager, who shall be the
administrator of this Agreement on behalf of the City, and such other employees, consultants,
and attorneys of the City from time to time as the City Manager may designate. In addition,
Developer shall have the right to communicate with staff of other public agencies; and with third
parties to all agreements affecting the Property in connection with Developer’s proposed
purchase of the Propertyand development of the Project. The City staff shall have the right, but
not the obligation, to attend and participate in any and all meetings with other public agencies,
with regard to the Project. Upon request of the City, Developer shall promptly provide the City
with a copy of each material item of correspondence (including emails, letters, facsimiles, and
any enclosures and attachments) sent to or received by Developer from third partiesin
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connection with entitlement, community, or governmental approval of the Project, provided,
however, that Developer shall not be obligated to deliver any such materials that based upon
advice of counsel are determined to be subject to attorney-client orother privilege.
Title; Survey
6..
Survey by Developer
6.1..
Developer, prior to the end of the Due Diligence Periodandat Developer’s sole expense,
Survey
shall have obtained a survey for the Property (“”) prepared by a licensed surveyor
Surveyor
(“”), which Survey shall be certified by the Surveyor to the City, Developer and the
Title Company. The Survey shall depict: (a) the boundaries of each of the proposed
Development Parcels, (b) the location of all existing improvements (if any), existing perimeter
improvements (if any), and easements, roads, rights-of-way and encroachments located within
twenty (20) feet of the boundary of the Development Parcels, (c) all other Permitted Exceptions
susceptible to depiction on a map or survey identified by reference to the recording information
applicable to the documents creating them, and (d) any portion of the Development Parcels lying
within a flood hazard area.
Permitted Exceptions.
6.2.
Developer, at Developer’s sole cost and expense, has caused the Title Company to
prepare and deliver to Developer and the City with respect to the Development Parcels the
preliminary title report attached as Attachment 4and may cause the Title Company to issue
Preliminary Title Reports
additional preliminary title reports (collectively, the “”) based upon
which the Title Company may issue an extended American Land Title Association Owner’s
ALTA Policy
Policy for the Development Parcels (collectively the “”) to Developer in the
amount of the Base Purchase Price and such additional amounts as Developer may request of
Title Company. During the Due Diligence Period, Developer shall review the Preliminary Title
Reports and the other relevant documents referenced below, and may object to matters set forth
in the Preliminary Title Reports and request that the Title Company remove from the Title Policy
those exceptions to title disapproved by Developer in the Preliminary Title Reports. The
Permitted Exceptions
“” to title shall include the following: (a)as of the last day of the Due
Diligence Period, all matters set forth on the Preliminary Title Reports, set forth on the Survey,
and not otherwise deleted from the Preliminary Title Reports nor endorsed over by the Title
Company; (b) the Other Agreements that are to be recorded pursuant to Section 7.4.6(b); and
(c)all covenants, restrictions and encumbrances, liens, exceptions, leases, restrictions, deed
restrictions and qualifications expressly set forth in or permitted or contemplated by this
Agreement or the Other Agreements. Notwithstanding anything to the contrary in this
Agreement, the City shall deliver the Property to Developer free and clear of all monetary liens
other than liens for real property taxes that are not yet delinquent.
Supplemental Title Reports
6.3..
If, after the end of the Due Diligence Period, the Title Company discloses additional
matters that affect title to the Development Parcels, then within ten (10) calendar days after
Developer’s receipt of any report issued by the Title Company concerning the Property (a
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Supplemental TitleReport
“”), Developer shall provide the City a copy of such Supplemental
Title Report and shall specify in writing Developer’s disapproval of any item or exception shown
on such Supplemental Title Report not previously included in the Preliminary Title Reports and
Disapproved Exception
that is not acceptable to Developer (“”), together with Developer’s
suggested cure thereof; provided, that Developer shall not have the right to disapprove any item
or exception specifically consented to by Developer, includingall exceptions arising pursuant to
this Agreement and all matters appearing on the Preliminary Title Report. Failure of Developer
to disapprove any item or exception shown on any such Supplemental Title Report on or before
the expiration of such ten (10)calendar day period shall be deemed to be an approval of the
matters set forth in such Supplemental Title Report. If Developer designates a Disapproved
Exception, Developer shall specify in writing its reason for such disapproval, and the City shall
havethe right, but not the obligation, to (a)remove or cure the Disapproved Exception to the
reasonable satisfaction of Developer, or (b)subject to the last sentence of Section 6.2, elect not
to cure such Disapproved Exception. If the City fails to notify Developer of the City’s election
to remove or cure such Disapproved Exception within ten (10) calendar days after the City’s
receipt of Developer’s notice of disapproval, the City shall be deemed to have elected not to cure
such Disapproved Exception. If the City elects or is deemed to have elected not to cure any such
Disapproved Exception then Developer’s exclusive remedy shall be: (i)to accept such
Disapproved Exception and proceed to take title to the Property in the manner set forth in this
Agreementand without either deduction or offset to the Purchase Price, and waive such
Disapproved Exception without cause of action hereunder against the City, or (ii)to provide
written notice to the City within five (5) calendar days after the City’s election ordeemed
election, of Developer’s election to terminate this Agreement and the Escrow, in which case the
Purchase Price Deposit, to the extent previously paid by Developer, shall be refunded to
Developer in accordance with Section5.3. Developer’s failureto provide the City within said
five (5) calendar day period with written notice of either Developer’s acceptance of such
Disapproved Exception or Developer’s election to terminate this Agreement shall constitute
Developer’s acceptance of such DisapprovedException and its election not to terminate this
Agreement under the foregoing clause(ii). In the event Developer shall not have terminated this
Agreement under clause(ii)of the preceding sentence, then all matters and exclusions or
exceptions from title insurance coverage shown in such Supplemental Title Report which
Developer shall have accepted (or been deemed to have accepted) pursuant to this Section 6.3
(other than those which the City has agreed to cure as provided in this Section 6.3), togetherwith
Permitted Exceptions.
all Permitted Exceptions described in Section 6.2 shall be deemed “”
ALTA Policy; Endorsements
6.4..
It shall be a condition precedent to Developer’s obligation to close Escrow that the Title
Company issue the ALTA Policy with policy amount equal to the Base Purchase Price for the
Original
Development Parcels being purchased and subject only to the Permitted Exceptions (“
ALTA Coverage
”). The City shall only be obligated to deliver to the Title Company an owner’s
affidavit regarding title in a form acceptable to the City in its reasonable discretion. Developer
shall have the right, at its sole expense, to request and obtain additional ALTA coverage for the
Additional ALTA Coverage
value of the development cost of the Project (“”) and any title
Developer Title Endorsements
endorsements as Developer deems necessary (the “”); provided
that the issuance of such Additional ALTA Coverage and the Developer Title Endorsements
shall not delay the Close of Escrow and shall not be a condition precedent to the Close of
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Escrow. Developer shall pay for all costs attributable to the ALTA Policy (other than the
premium attributed to so-called standard coverage in the amount of the Base Purchase Price), the
cost of all Developer Title Endorsements and thecost of a lender’s policy of title insurance, if
any.
Closing
7..
Time and Place of Closing
7.1..
Close of Escrow
7.1.1.. Unless otherwise mutually agreed by the Parties in
writing, the Close of Escrow shall take place on that date which is ten (10) Business Days
following the last to occur of the satisfaction,or the waiver thereof by the Party for whose
benefit the condition applies, of the Developer Closing Conditions set forth in Sections 7.2.1(d),
(e)and (f)and the City Closing Conditions set forth in Sections 7.2.2(c), (d), (e), (f), (g),(h), (j)
Closing Date
and (k)(the “”) provided that in no event shall Developer be obligated to close
unless it has received at least ten (10) Business Days’ advance written notice from the City of the
anticipated date for satisfaction of such City Closing Conditions and provided, further, that the
Outside Closing Date
Close of Escrow shall in no event be later than May 30, 2014 (the “”).
The Close of Escrow shall be subject to the satisfaction of the conditions set forth in Sections
7.2, 7.3 and 7.4, and shall take place at the offices of Escrow Holder, or at such other place that
the City selects. Notwithstanding anything to the contrary set forth in this Agreement, the
Outside Closing Date shall be automatically extended to August 15, 2014 in the event one or
more of the Closing Conditions set forth in the first sentence of this Section 7.1.1 are not
satisfied ten (10) Business Days prior to May30, 2014 due to factors outside of Developer’s
reasonable control.
Extension of Closing Dates
7.1.2..The Closing Date (and Outside Closing
Date) may be extended upon mutual written agreement of the Parties. In the event that the Close
of Escrow does not occur on or prior to the Outside Closing Date (as such date may be
automatically extended pursuant to Section 7.1.1.), then, subject to the provisions of Section 15
or any agreement by the Parties (in their sole and absolute discretion) to extend the Outside
Closing Date, this Agreement shall terminate at the end of the Business Day on the Outside
Closing Date.
Conditions Precedent to Close of Escrow.
7.2.
Developer Closing Conditions.
7.2.1.Developer’s obligation to purchase the
Property and to complete all requirements for the Close of Escrow is subject to and conditioned
upon the satisfaction of, or Developer’s written waiver of, each of the following conditions to the
Developer Closing Conditions
Close of Escrow (“”) on or before the Closing Date:
(a)Document Deliveries. Not later than two (2) Business Days prior
to the Close of Escrow, the City shall have executed and delivered to Escrow Holder the
following documents, in each case (where applicable) substantially in the form and substance of
the instruments attached as Attachments to this Agreement, unless otherwise agreed by the
Parties, each in their sole discretion:
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(i)if not previously Recorded, the Memorandum of DDA,
acknowledged and in Recordable form;
(ii)the Special Restrictions, acknowledged and in Recordable
form;
(iii)a Quitclaim Deed for the Property, acknowledged and in
Recordable form;
(iv)if not previously recorded, the DA,acknowledged and in
Recordable form;
(v)theProfit Participation Agreement;
(vi)the Landscape Maintenance Agreement acknowledged and
in Recordable form;
Soil License
(vii)the License and Soil License Agreement(“
Agreement
”);
(viii)federal “FIRPTA” Affidavit;
(ix)California’s Real Estate Withholding Exemption Certificate
Form 593-C;
(x)A bill of sale for of all City-owned utility systems
previously owned by the military on the Development Parcels and
providing for removal and abandonment of those systems for construction
Bill of Sale
of Improvements (“”);
(xi)a reaffirmation of the City’s representations and warranties
set forth in Sections 3.3and 17.12, in substantially the form and substance
of the certificate attached hereto as Attachment 17,which reaffirmation
shall identify any representation or warranty which is not, or no longer is,
true and correct and explaining the state of facts giving rise to the change;
(xii)such proof of the City’s authority and authorization to enter
into this Agreement and consummate the transactions contemplated
hereby, and such proof of the power and authority of the individual(s)
executing and/or delivering any instruments, documents or certificates on
behalf of the City to act for and/or bind the City as may be reasonably
required by Title Company and/or Developer; and
(xiii)subject to Section 6.2, such other documents or instruments
as Escrow Holder may reasonably request to consummate the transaction
contemplated in this Agreement.
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(b)Title Policy. The Title Company shall be in a position to issue the
ALTA Policy to Developer for the Development Parcels in the amount of the Base Purchase
Price and subject only to the Permitted Exceptions.
(c)Pre-Existing Obligations. Except as approved by Developerin
writing or constituting a Permitted Exception, there shall exist no leases, contracts or rights of
occupancy or other agreements or contracts with respect to the Property (but excluding the
provisions of the Federal Deed and the Memorandum of Agreement) entered into by the City that
shall survive the Close of Escrow.
(d)Entitlements. Developer shall have timely applied for and shall
have been granted all Entitlements required for development of the Project and all applicable
appeal and statute of limitations periods relating thereto shall have expired without the filing of
any appeal or legal challenge or any such appeal or legal challenge shall have been resolved in
favor of Developer and the Project.
(e)Design Review. Developer shall have timely applied for and shall
have been granted approval of the Basic Concept Plan for the Project, which shall be
substantially in conformance with the Site Plan and the Scope of Development.
(f)Permits. Developer shall have timely applied for and the City shall
be prepared to issue all grading permits for the Grading Work.
(g)No Casualty or Condemnation. There shall not have occurred any
material casualty or condemnation with respect to the Property and no material condemnation
shall be threatened with respect to the Property.
(h)No Litigation. No litigation shall be threatened or pending which
seeks to prevent the development or operation of the Project, or any part thereof, according to the
terms of this Agreement and the Other Agreements.
(i)Representations and Warranties. The City’s representations and
warranties set forth in Section 3.3 and 17.12 shall be true and correct as of the Close of Escrow,
provided, in no event shall the City be liable to Developer for, or be deemed to be in Default
under this Agreement by reason of, any breach of representation or warranty which results from
any change that (i) occurs between the Effective Date and the date of the Close of Escrow, and
(ii) is expressly permitted under the terms of this Agreement or is beyond the reasonable control
of the City to prevent. The occurrence of a change in a representation and warranty shall, if
materially adverse to Developer or the Property, as determined by Developer in Developer’s
reasonable business judgment, constitute the non-fulfillment of the condition set forth in this
Section 7.2.1(i), unless such matter is cured at least one (1) Business Day prior to the Close of
Escrow. If, despite changes or other matters described in the City’s reaffirmation certificate, the
Close of Escrow occurs, the City’s representations and warranties set forth in Sections 3.3and
17.12 of this Agreement shall be deemed to have been modified by all statements made in such
certificate.
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(j)Default. The City shall not be in Default of any covenant or
agreement to be performed by the City under this Agreement.
City ClosingConditions
7.2.2.. The City’s obligation to deliver the Quitclaim
Deed for the Property and to complete all requirements for the Close of Escrow is subject to and
conditioned upon the satisfaction of, or the City’s written waiver of, each of the following
City Closing Conditions
conditions to the Close of Escrow (“”) on or before the Closing Date:
(a)Developer Closing Payment. Not later than one (1) Business Day
prior to the Close of Escrow, Developer shall deliver to Escrow (i) the Developer Closing
Payment with respect to the Base Purchase Price and (ii) any other costs explicitly set forth in
this Agreement as costs to be paid by Developer at the Close of Escrow.
(b)Document Deliveries. Not later than two (2) Business Days prior
to the Close of Escrow, Developer shall have executed and delivered to Escrow Holder the
following documents, in each case (where applicable) substantially in the form and substance of
the instruments attached as Attachments to this Agreement, unless otherwise agreed by the
Parties, each in their sole discretion:
(i)if not previously executed and Recorded, the Memorandum
of DDA, acknowledged and in Recordable form;
(ii)an Acceptance of the SpecialRestrictionsacknowledged
and in Recordable form;
(iii)an Acceptance of the Quitclaim Deed, acknowledged and
in Recordable form;
(iv)if not previously recorded, the DA,acknowledged and in
Recordable form;
(v)the Profit Participation Agreement;
(vi)the Landscape Maintenance Agreement,acknowledged and
in Recordable form;
(vii)the Soil License Agreement;
(viii)the Bill of Sale;
(ix)a reaffirmation of Developer’s representations and
warranties set forth in Sections3.1 and 17.12 in substantially the form and
substance of the certificate attached heretoas Attachment18,which
reaffirmation shall identify any representation or warranty which is not, or
no longer is, true and correct and explaining the state of facts giving rise to
the change;
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(x)a declaration certified by an officer of Developer in
substantially the form and substance of the certificate attached hereto as
Attachment 18that the documentation submitted by Developer to the City
pursuant to Section 4.6.5 prior to the Effective Date is true and correct as
of the Close of Escrow together with certificates of good standing of
Developer, issued by the State of Delaware and by the California
Secretary of State within thirty (30) calendar days of the Closing Date;
(xi)such proof of Developer’s authority and authorization to
enter into this Agreement and consummate the transactions contemplated
hereby, and such proof of the power and authority of the individual(s)
executing and/or delivering any instruments, documents or certificates on
behalf of Developer to act for and/or bind Developer as may be reasonably
required by Title Company and/or the City; and
(xii)such other documents or instruments as Escrow Holder
may reasonably request to consummate the transaction contemplated in
this Agreement.
(c)Entitlements. Developer shall have timely applied for and shall
have been granted all Entitlements required for development of the Project and all applicable
appeal and statute of limitations periods relating thereto shall have expired without the filing of
any appeal or legal challenge or any such appeal or legal challenge shall have been resolved in
favor of Developer and the Project.
(d)Design Review. Developer shall have timely applied for and shall
have been granted approval of the Basic Concept Plan for the Project, which shall be
substantially in conformance with theSite Plan and the Scope of Development.
(e)Performance Bonds. Developer shall have provided one or more
Performance Bonds in favor of the City as obligeesecuring Developer’sobligations to perform
the Grading Work;
(f)Permits. Developer shall have timely applied for and the City shall
be prepared to issue all grading permits for the Grading Work.
(g)CFD Formation.The City shall have formed the AD/CFD,
including both “Tax A” and “Tax B”, in accordance with Section 8.7.3 and the Tustin Unified
School District shall have formed a CFDor other assessment districtfor the Property with an
TUSD CFD
average unit tax burden ofapproximately$1516 per unit (the “”) and each such
formationshall be Finally Approved,provided that if this condition has not been satisfied by July
31, 2014, it shall be deemed waived by the City.
(h)CC&Rs. Developer shall have submitted for City review a first
draft of the CC&Rsas specified in Section 13.1, which shall have been approved by the City
pursuant to Section 13.1.
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(i)Insurance. Developer shall have provided to the City evidence of
insurance as and to the extent required by Section 11.
(j)Financial Capability. Developer shall have satisfied the conditions
precedent to Close of Escrow set forth in Section 4.6.1 to the satisfaction of the City in its sole
discretion, including delivery to the City of evidence as required by such provisions
demonstrating (i) the availability of funds,without third party financing or Mortgage of any kind,
sufficient to pay all costs relating to acquisitionof the Property and development of the Project
on the Property, including sufficient equity capital to design, construct and operate the Project
(ii) no material adverse change in the financial capacity or condition of Developer or its financial
or organizational relationships from that presented to the City as of the Effective Date, (iii) that
the Financing Plan remains in full force and effect, or as modified, is satisfactory to the City in
its sole discretion, and (iv) that the Project budget for the Improvements remains a reasonable
budget.
(k)Additional Conditions. Developer shall have satisfied the
conditions precedent to Close of Escrow set forth in Sections 4.6.1through 4.6.5 of this
Agreement and shall be in compliance with the requirements of Section 8.5.2.
(l)Representations and Warranties. Developer’s representations and
warranties set forth in Sections 3.1 and 17.12 shall be true and correct as of the Close of Escrow,
provided, in no event shall Developer be liable to City for, or be deemed tobe inDefault under
this Agreement by reason of, any breach of representation or warranty which results from any
change that (i) occurs between the Effective Date and the date of the Close of Escrow, and (ii) is
expressly permitted under the terms of thisAgreement or is beyond the reasonable control of
Developer to prevent. The occurrence of a change in a representation and warranty shall, if
materially adverse to City, as determined by City in City’s reasonable business judgment,
constitute the non-fulfillment of the condition set forth in this Section 7.2.2(l), unless such matter
is cured at least one (1) Business Day prior to the Close of Escrow. If, despite changes or other
matters described in Developer’s reaffirmation certificate, the Close of Escrow occurs,
Developer’s representations and warranties set forth in Section 3.1 and 17.12 this Agreement
shall be deemed to have been modified by all statements made in such certificate.
(m)Default. Developer shall not be in Default of any covenant or
agreement to be performed by Developer under this Agreement.
Additional Close of Escrow Conditions
7.3..
In addition to the provisions of Section7.2, the Close of Escrow shall be conditioned
upon the following Closing Conditions, which shall be for the benefit of each Party:
(a)Closing Cost Statement. Escrow Holder shall have delivered at
least seven (7)Business Days prior to the Close of Escrow a statement of costs to each Party and
at least two (2) Business Days prior to the Close of Escrow each of the Parties shall have
approved such statement as being consistent with the provisions of Section7.4.
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(b)Closing Certificate. Each Party shall submit to Escrow Holder a
certificate stating that all Closing Conditions for its benefit have been satisfied or waived.
Procedures for Conveyance
7.4..
Costs and Expenses
7.4.1.. The costs and expenses of the Close of Escrow
shall be allocated as follows:
(a)City’s Costs. The City shall pay (i) the portion of the premium for
the ALTA Policy attributable to the so-called standard owner’s policy coverage portion thereof
in the amount of the Base Purchase Price; (ii) one-half (1/2) of all Escrow fees and costs; (iii) all
documentary transfer taxes, if any; and (iv) the City’s share of prorations, if any.
(b)Developer’s Costs. Developer shall pay (i)the entire cost of any
extended coverage in excess of the premium for the standard CLTA coverage in the amount of
the Base Purchase Price for the Development Parcels being purchased, any other title policy and
any Developer Title Endorsements, (ii) the entire cost of the Survey and any additional land
surveys obtained by Developer in connection with the foregoing; (iii) document recording
charges for the Special Restrictions, the Quitclaim Deed, the Memorandum of DDA and all other
Recorded documents; (iv) one-half (1/2) of all Escrow fees and costs; and (v) Developer’s share
of prorations. Developer shall pay the fees of all consultants and employees (including lawyers
and environmental, engineering and land use consultants) engaged by it.
(c)Other Costs. All costs and expenses related to the Close of Escrow
and the transfer of the Property to Developer not otherwise allocated in this Agreement shall be
allocated between the Parties in accordance with the customary practice in Orange County,
California.
Possession
7.4.2.. The City shall deliver possession of the Property at the Close
of Escrow.
Deliveries to Developer Upon Close of Escrow
7.4.3.. The City agrees to
deliver to Developer, on or prior to the Close of Escrow, outside of Escrow, the following items
with respect to the Property:
(a)Records and Plans. To the extent in the City’s possession,
originals or copies of records and plans that will affect the Property after the Close of Escrow.
(b)Licenses and Permits. To the extent in the City’s possession,
originals or copies of all licenses and permits affecting the Property.
Prorations
7.4.4..
(a)General. Rentals, revenues and other income, if any, from the
Property shall be prorated on a cash basis as of 11:59 P.M. Pacific Time on the day preceding the
Close of Escrow. Tax payments shall be prorated in accordance with Section7.4.4(b).
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(b)Taxes. Developer shall be responsible for all taxes, assessments,
fees and charges imposed by any Governmental Authority with respect to the Property conveyed
to it and all existing and future improvements thereon from and after the Close of Escrow. If,
after the Close of Escrow, any real estate taxes or possessory interest taxes are assessed against
any conveyed parcel pertaining to the period prior to the Close of Escrow, the City agrees to
contact the applicable taxing authority and seek recognition and enforcement of its tax
exemption. The provisions of this clause (b) shall survive the Close of Escrow and shall not
merge into the QuitclaimDeed.
Method of Proration
7.4.5.. All prorations shall be made in accordance with
customary practice in Orange County, except as otherwise expressly provided in this Agreement.
Developer and the City agree to cause a schedule of prorations to be prepared prior to the Close
of Escrow. Such prorations, if and to the extent known and agreed upon as of the Close of
Escrow, shall be paid by Developer to the City (if the prorations result in a net credit to the City)
or by the City to Developer (if the prorations result in a net credit to Developer) by increasing or
reducing the cash to be paid by Developer at the Close of Escrow. Any such prorations not
determined or not agreed upon as of the Close of Escrow shall be paid by Developer to the City,
or by the City to Developer, as the case may be, in cash as soon as practicable following the
Close of Escrow. A copy of the schedule of prorations as agreed upon by Developer and the
City shall be delivered to Escrow Holder at least three (3) Business Days prior to the Close of
Escrow. All prorations provided for in this clause (c) shall be on an “actual day” basis and a
three hundred sixty-five (365) day year.
Disbursements and Other Actions by Escrow Holder
7.4.6.. At the Close of
Escrow, and subject to the satisfaction or waiver by the benefited party of the conditions to Close
of Escrow described in Section 7.2, Escrow Holder shall promptly undertake all of the following
in the manner indicated below:
(a)Funds. Debit or credit all matters addressed in Section7.4.1 and
prorate all matters addressed in Section7.4.4 and disburse to the City the Base Purchase Price (as
adjusted by the foregoing debits, credits and prorations).
(b)Recording. Cause to be Recorded against the Development
Parcels, in the following order: the Memorandum of DDA, the Special Restrictions, the
Quitclaim Deed, the Landscape Maintenance Agreement and thereafter, other documents that
Developer and the City may mutually direct, or that may be required by the terms of this
Agreement to be Recorded, obtain conformed copies thereof and distribute same to Developer
and the City.
(c)Title Policy. Direct the Title Company to issue the ALTA Policy
to Developer in the amount of the Base Purchase Price and subject only to the Permitted
Exceptions. Concurrently with the issuance of the ALTA Policy, the Title Company shall
provide the Developer Title Endorsements, provided that the issuance of such Developer Title
Endorsements shall not be a condition to Close of Escrow, except for those endorsements that the
City agreed to obtain in order to cure any disapproved title exceptions or survey matters.
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(d)Delivery of Documents to Developer and City. Deliver to each
Party original counterparts (and conformed copies, if applicable) of the Special Restrictions, the
Memorandum of DDA (if not previously recorded), the Quitclaim Deed, the DA, the Profit
Participation Agreement, the Landscape Maintenance Agreement, the Soil License Agreement,
theBill of Sale, theFIRPTA Affidavit, the California Form 593-W and any other documents (or
copies thereof) deposited into Escrow by Developer or the City pursuant hereto, and deliver to
the Parties a certified copy of their respective Escrow closing statements.
(e)Other Actions. Take such other actions as the Parties direct
pursuant to mutually executed supplemental Escrow instructions.
Notice
7.4.7.. All communications from the Escrow Holder shall be directed to
the addresses and in the manner established in Section 17.6for notices, demands and
communications between the Parties.
Development of the Property and Additional Covenants of Developer and City
8..
Scope of Development
8.1..
Requirement to Develop the Project
8.1.1.. The Scope of Development
attached to this Agreement as Attachment 8sets forth the overall plan for the Project and
development of the Development Parcels, including design, development, and construction of the
Improvements as may be required by each Entitlement approval. Until the issuance of the
Certificate of Compliance and except as otherwise permitted by Section 2.2, no Person shall be
permitted or authorized to undertake the construction of any improvements on the Development
Parcels or any portion thereof (including the Improvements) unless such Person is a Permitted
Transferee or has been approved by the City as a Transferee pursuant to Section 2.2.3 and in any
such case has assumed in writing all obligations of Developer under this Agreement and the
Other Agreements, pursuant to an Assignment and Assumption Agreement in the form attached
to this Agreement as Attachment 16Aor in the case of a Builder Transfereesuch obligations as
are specified in Attachment16B. The provisions of this Section shall survive termination of this
Agreement.
Control of Site Development
8.1.2.. Developer shall have control over the
design and layout of the Improvements (including height, shape and location of the Vertical
Improvements and special landscaping and art features) and over the special uses to be
incorporated therein, subject to (a) the Approved Plans, Development Permits and Entitlements,
including any conditional use permit necessitated by particular proposed uses or design features
and (b) the design approval provisions set forth in Section 8.4for the benefit of the City, which
are undertaken by the City in its Proprietary Capacity.
Project Development Costs
8.1.3.. Within the time set forth in the Pre-Closing
Schedule and the Schedule of Performance, as applicable, Developer shall design and construct
the Project upon the Property at Developer’s sole cost and expense and without public subsidy of
any kind, unless otherwise agreed in writing by the City in its sole discretion. Without limiting
the generality of the foregoing, Developer hereby agrees that all costs associated with planning,
designing and constructing the Project, preparing the Property and constructing all Improvements
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(whether on-site or off-site) required in connection with the Project, including all hard costs, soft
costs, the cost of services, fees, exactions, dedications, cost overruns, profit, overhead, marketing
fees, sales incentives, insurance, overhead, Entitlement costs, warranties, consultants’ fees, legal
fees, wages required to be paid to any person employed by Developer, any Transferee, contractor
or subcontractor, and the costs of the Project Fair Share Contribution (collectively, the
Development Costs
“”), shall be the responsibility of Developer without any cost or liability to
the City.Developer will be responsible for all costs of any necessary in-tract improvements,
including those identified for the Property on Attachment 9.
Compliance with Governmental Requirements and Other
8.1.4.
Requirements
. Developer shall develop the Project and the Development Parcels in the manner
described in and consistent with the Scope of Development, the Site Plan attached as
Attachment3, and in accordance with the Scheduleof Performance, the Approved Plans and all
Governmental Requirements, as further described below, including the Specific Plan, the
Entitlements, the Development Permits, the Memorandum of Agreement and the Federal Deed.
Timing and Conditions of Project Development
8.2..
Pre-Closing Schedule and Schedule of Performance
8.2.1..The Pre-Closing
Schedule sets forth the schedule for the period prior to the Close of Escrow. The Schedule of
Performance sets forth the post-closing schedule for submissions, approvals and actions,
including the design and development of the Project and construction of the Improvements. The
Parties acknowledge and agree that, subject to Section 17.7.4, time is of the essence with respect
to the dates set forth in thePre-Closing Schedule and theSchedule of Performance. Following
conveyance of the Property to Developer, Developer shall promptly begin and thereafter
diligently prosecute to completion all steps required by the Schedule of Performance including
design, construction and development of the Improvements for the Project within the time
specified in the Schedule of Performance. Subject to Section 17.7, the City may, in its sole
discretion and upon written request from Developer, extend the time specified for any of
Developer’s obligations in the Schedule of Performance. Any such agreed upon changes shall be
within the limitations of the Specific Plan, the Entitlements, the Development Permitsand all
other Governmental Requirements. To be effective, any extensions shall be requested in writing
by Developer and evidenced by written notice from the City Manager or designee.
Completion of Improvements
8.2.2.. Immediately after Close of Escrow,
Developer shall promptly begin and thereafter diligently prosecute to Completion the
Improvements in accordance with the requirements of and within the time periods established by
this Agreement, including the Schedule of Performance, the Approved Plans, the Entitlements,
the Development Permits, the Specific Plan, and all other Governmental Requirements,as well
as all requirements of private utility purveyors. Developer shall Complete the Improvements on
or before the date set forth for performance of such work in the Schedule of Performance.
License for Construction
8.2.3..Developer shall have the right, at its sole cost
and expense, and pursuant to license agreement between the City and Developer approved by
each in its sole discretion, to enter upon the Development Parcels prior to the Close of Escrow
for purposes of carrying out the Grading Work and, to the extent agreed by the Parties in the
construction license,the construction of the Horizontal Improvements. City and Developer shall
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use commercially reasonable efforts to agree upon the form of the construction license within ten
(10) days following the Effective Date of this Agreement.The construction license shall provide
that Developer may commence the construction activities once the City has approved the
Approved Plans for the Grading Work orHorizontal Improvements, as applicable,and has issued
grading permits or other permits,as applicable, and provided that all other conditions to
commencement of such work described in the Entitlements, this Agreement and the Schedule of
Performance have occurred.
Land Use Matters
8.3..
Required Entitlements
8.3.1.. Developer shall, at its sole cost and expense,
process, obtain, and maintain all Entitlements to assure that the design, construction, use,
operation, maintenance, repair and replacement of the Improvements is carried out in accordance
with the provisions ofthis Agreement, and is permitted by the Entitlements and all other
Governmental Requirements. Development of the Project shall be subject to the following
Entitlement review processes of the City: (a) Specific Plan Amendment 2013-002; (b) the
Concept Plan and Design Review approval(Design Review application 2013-006 and Concept
Plan application 2013-002), (c) Tentative Tract Map approval (Tentative Tract Map application
2013-17507) and (d) Development Agreement approval (application 2013-003) and any other
approvals to the extent required by the City Code to permit the uses contemplated in the Site
Plan or Approved Project Plans. Without limiting the foregoing, in developing and constructing
the Project, Developer shall ensure that the Project complies with all applicable development
standards in the Specific Plan, the City Code and with all building codes, landscaping, signage
and parking requirements, except as may be permitted through variances and modifications.
Development Permits
8.3.2.. Developer, at its sole cost and expense shall
process, obtain, and maintain all Development Permits required for the construction, use,
operation, maintenance, repair and replacement of the Improvements.
Agreement Does Not Grant Entitlements
8.3.3.. Nothing in this Agreement
shall be construed or interpreted as committing the City to approve or undertake any action or
review process or activities that require the independent exercise of discretion by the City in its
Governmental Capacity, including any approval of any Entitlement or Development Permit
application for which Developer applies after the Effective Date. This Agreement does not
(a)grant any land use entitlement to Developer, (b)supersede, nullify or amend any condition
which may be imposed by the City in its Governmental Capacity in connection with approval of
the Project, (c)guarantee to Developer or any other party any profits from the development of
the Property, or (d) amend any Governmental Requirements of the City. The issuance or
approval of any Entitlement not issued or approved on or prior to the Effective Date or any
Development Permit described in this Agreement shall be done by the City in its Governmental
Capacity. Nothing contained in this Agreement shall be deemed to waive the right of the City to
act in its Governmental Capacity with respect to the consideration and approval of the
Entitlements and all other permits, licenses and approvals requested by Developer from time to
time in connection with the Project nor shall it entitle Developer to any Entitlement,
Development Permit or other City approval necessary for the development of the Project, or to
the waiver of any applicable City requirements relating thereto, and the failure of the City to
issue or approve any Entitlement described in this Agreement, including to certify or approve
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any CEQA document, to approve any required tentative tract map, Concept Plan and Design
Review, conditional use permit or other Entitlement or Development Permit shall not be a
default of the City under this Agreement.
Cooperation of City
8.3.4.. Consistent with this Agreement, the City agrees,
without cost or other liability to the City or any commitment of the City to approve or
conditionally approve any Entitlements required for the full implementation of this Agreement,
to assist and cooperate with Developer in its efforts to process the Entitlements and Development
Permits. The City will use good faith efforts to expedite review of applications for the
Entitlements and the Development Permits that are to be issued bythe City and other
submissions made by Developer where reasonably appropriate in order to meet the deadlines set
forth in the Schedule of Performance and will assist and cooperate with Developer in its efforts
to process such Development Permits, Entitlements and other submissions.
CEQA Requirements
8.3.5.. The Parties acknowledge and agree that CEQA is
applicable to discretionary actions associated with the development of the Project.Developer
acknowledges that the City shall prepare any supplemental environmental information, if any, as
may need to be completed in order to effect compliance with CEQA, as determined by the City
in its sole discretion, and Developer shall be responsible to pay all costs incurred by the City to
prepare or to cause to its consultants to prepare such environmental documents and shall enter
into such agreements to pay such costs as the City shall require. Developer agrees to cooperate
with the City in obtaining information to determine the environmental impact of the Project, if
any.
Entitlement Conditions
8.3.6.. Developer acknowledges and agrees that the
City in its Governmental Capacity may require satisfaction of certain conditions and dedication
of certain property in connection with approval of any Entitlements.
Payment of Fees
8.3.7..Without limiting any other provision of this
Agreement, Developer shall pay (a) all fees, costs and deposits normally charged by the City or
other Governmental Authority in connection with application for and review and approval of
Development Permits and Entitlements, (b) any fees or costs incurred by the City or any other
Governmental Authority in complying with CEQA or the State CEQA implementing regulations;
(c) any costs to review or approve any Entitlement or Development Permit applications or
submittals by Developer to the City or any other Governmental Authority in connection with the
Project.
Design Approval
8.4..
Design Review
8.4.1.. It is understood and agreed to by Developer that the
quality, character and uses proposed for the Project are of particularimportance to the City. In
furtherance of the development of the Project and the foregoing, the City, acting in its
Governmental Capacity, shall require Concept Plan and Design Review approval as part of the
Entitlements. In addition, in its ProprietaryCapacity as the current owner of the real property
that is the subject of this Agreement and of substantial portions of Tustin Legacy, the City will
require review and approval of the Basic Concept Plan for the Project as further set forth in this
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Section8.4. Review of design documents by the City in its Proprietary Capacity only shall be
subject to time periods set forth below.
Plan Development and Cost
8.4.2.. All plans and specifications for the Project
shall be prepared by Developer at Developer’s sole cost and expense and subject to the
requirements set forth in this Section8.
Process for Governmental Review
8.4.3.. The Parties acknowledge that the
City shall have the right to review all plans, specifications and submissions, including any
changes therein, through its normal plan review and Entitlement process and that the City may
exercise its governmental discretion in its Governmental Capacity in review of any of the plans,
specifications and submissions. Developer has previously submitted to the City a preliminary
Site Plan
site plan for the Project (the “”), a copy of which is attached as Attachment 3,
graphically depicting the overall plan for grading of the Development Parcels anddevelopment
of the Improvements on the Development Parcels, the Building floor plans and dimensions,
proposed lots, Common Areas, Common Area Improvements(including thePark Facilitiesto
assure, among other things,that such facilities meet the minimum requirements pursuant to
Tustin Code Section 9331(d)), and parking, landscaping and access on and related to the
Development Parcels, floor plans, preliminary materials call-outs and conceptual building
renderings and, if applicable, setting forth the phasing plan. Within the timeframe shown in the
Schedule of Performance, Developer shall submit for approval by the City in its Governmental
Capacity, final design drawings and related documents conforming to the requirements of the
City Code, the Specific Plan and all other Entitlements and conditions of approval. The
Community Development Department is authorized pursuant to City Code to approve minor
changes to building plans after approval by the City provided such changes do not significantly
reduce the quality of the development concept or the design and materials to be used in
enhancing the architecture and aesthetics of the Improvements.
Coordination
8.4.4.. Developer and the Project Architect shall meet with
representatives of the City to review and come to a clear understanding of the planning and
design criteria required by theCity. During the preparation of all plans and specifications for the
Project, staff of the City and Developer shall hold regular progress meetings to coordinate the
preparation, submission and review of such plans. The staff of the City and Developer shall
communicate and consult as frequently as necessary to facilitate prompt and speedy
consideration of Developer’s submittals.
Proprietary Review
8.4.5..Prior to the Effective Date, Developer has caused
the Basic Concept Planto be prepared and submitted to the City for approvaland the City has
reviewed and approved the Basic Concept Plan in its Proprietary Capacity, including with
respect to exterior elevations, exterior materials (including selections and colors) and the size,
and floor plans for all Buildings and the product mix. Developer acknowledges and agrees that
the City’s Community Development Department is responsible for reviewing the working
drawings and issuing recommendations with respect to the appropriate Entitlementsand has
approved the Basic Concept Plan.In addition to its submittal of same to the Community
Development Department, Developer shall submit any modifications to the Basic Concept Plan
to the City Manager’s office for its approval in accordance with this Section. The exercise by the
City Manager’s office of its right to inspect or review the concept plans, drawings and related
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documents for development of the Project: (a) shall be an exercise of the City’s Proprietary
Capacity and not its Governmental Capacity; (b) shall not constitute an approval by the City of
any Entitlements;(c) shall not constitute a determination by the City of the engineering or
structural design, sufficiency or integrity of the improvements contemplated by such plans,
drawings and related documents, and(d) shall not constitute a determination by the City of the
compliance of such plans, drawings and related documents with any applicable building codes,
safety features and standards. Any inspection or approval of plans and drawings made or granted
pursuant to this Agreement shall not constitute an inspection or approval of the quality, adequacy
or suitability of such plans, specifications or drawings, nor of the labor, materials, services or
equipment to be furnished or supplied in connection therewith. Developer acknowledges and
agrees that the City in its Proprietary Capacity may approve or disapprovethe Basic Concept
Planand design review plansand any modifications theretoin order to satisfy the City’s
obligation to promote the sound development and redevelopment of land, to promote a high level
of design that will impact development surrounding the Project, and to provide an environment
for the social, economic and psychological growth and well-being of the citizens of the City and
that the City is not constrained or limited to act solely within its governmental discretion,
authority, or capacity. Developer shall not be entitled to damages or compensation as a result of
the City’s disapproval, conditional approval, or failure to approve or disapprove the Basic
Concept Planor any modification thereto in its Proprietary Capacity.
Process for Proprietary Review
8.4.6..If Developer desiresto modify the
Basic Concept Plan, Developer shall submit two sets of the modifications to the Basic Concept
Planfor the Improvements to the City. Such sets of Basic Concept Planshall be submitted in
writing over the signature of Developer or a representative duly authorized by Developer in
writing. If the City approves such modifications, the City shall endorse its approval on one set of
such Basic Concept Planand return them to Developer. The City, in its Proprietary Capacity
only,shall conclusively be deemed to have given its approval to such sets modifications Basic
Concept Planunless, prior to fifteen (15) Business Days after the City’s receipt of such
modifications, the City gives written notice of disapproval to Developer specifying in reasonable
detail each item that the City disapproves and the reasons for such disapproval. If necessary,
Developer shall make changes in response to the City’s notice of disapproval and resubmit such
Basic Concept Planto the City for review and approval in accordance with the provisions of this
Section 8.4.6 (and in such case the City’s review period shall be ten (10) BusinessDays.)
Approved Plans
8.4.7.. Upon (a) approval by the City in its Governmental
Capacity of the Entitlements as described in this Section8, (b) approval by the City in its
Proprietary Capacity of the Basic Concept Plan under Section 8.4, and (c) approval of
construction level drawings by the City in its Governmental Capacity, then such approved plans
Approved Plans
and drawings (collectively the “”) shall govern development of the
Improvements on the Property. In addition to any other rights to approve or disapprove the
construction level drawings in its Governmental Capacity, the City may disapprove such
documents if they are not consistent with the Entitlements and the Basic Concept Plan previously
approved, do not represent a logical or commercially reasonable implementation thereof, and/or
do not provide for construction of the same square footage as set forth therein. Developer shall
not construct any Improvements on the Property and shall not conduct any Grading Work on the
Property unless the same are shown in the Approved Plans or unless the prior written consent of
the City in its Proprietary Capacity and, if necessary, the approval of the City in its
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Governmental Capacity are obtained to any modification thereof. To the extent of any
inconsistencies between the plans identified in the Scope of Development or the Site Plan and
the Approved Plans, the Approved Plans shall govern and control as to the development of the
Property.
Financial Status
8.5..
Financial Capability
8.5.1.. After the Close of Escrow, and thereafter until
issuance of the Certificate of Compliance, Developer shall continue to be responsible for
demonstrating to the City the financial capacity of Developer and the capability of Developer to
perform its obligations under this Agreement. In addition to the requirements set forth in
Sections 4.6.1 and 4.6.2, during the period commencing on the Close of Escrow and ending on
the issuance of the Certificate of Compliance for the Project, Developer shall submit annually, on
the anniversary of the Closing Date, a date-down of the Financing Plan. If the City is not
reasonably satisfied with the financial status of Developer following review of the updated
Financing Plan, the City shall be entitled to obtain the financial information of other members
and/or partners of the proposed development entity (and their respective members, partners,
shareholders and/or other owners at each tier until substantial assets are identified).
No Mortgage
8.5.2.. In light of Developer’s representations set forth in Section
3.1, Developer hereby waives its rights:(a) to require or utilize third party financing with respect
to the acquisition of the Property or development of the Improvements on the Development
Parcels or any portion thereof prior to issuance of the Certificate of Compliance for the Project
and (b) to Transfer the Property or any portion thereof or to Transfer Control of Developer to a
Mortgagee or to record a Mortgage against the Property prior to the issuance of the Certificate of
Compliance unless otherwise agreed by the City in its sole discretion. The covenants of
Developer pursuant to this Section and the representations in Section 3.1 represent material
consideration to the City.
Additional Information
8.5.3.. Developer understands and agrees that the City
reserves the right at any time to reasonably request in writing from Developer additional
information, including information, data and commitments,to ascertain the depth of the
capability and desire of Developer or other equity participants, to develop the Project
expeditiously.
Project Budget Statement
8.6..
Developer understands and agrees that the City reserves the right to reasonably request at
any time prior to the issuance of the Certificate of Compliance for the Project (but not more
frequently than quarterly) that Developer provide a Project Budget Statement. If requested by
the City, Developer shall submit such Project Budget Statement within thirty (30) calendar days
following the later of Developer’s receipt of the City’s written request therefor and the expiration
of the applicable quarter. Notwithstanding the foregoing, the delivery of such Project Budget
Statement shall be for informational purposes only and in no event shall the City be entitled to
declare a Potential Default or Material Default, or exercise any of its remedies pursuant to this
Agreement, based on the contents of such Project Budget Statement absent an actual Potential
Default or Material Default under one of the other covenants or obligations of Developer set
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forth in this Agreement. All Project Budget Statements submitted by Developer in response to
request by the City shall be subject to the confidentiality provisions set forth in Section 4.6.
CFD; Fees and Exactions
8.7..
Developer Acknowledgements
8.7.1.. Developer acknowledges and agrees
that: (a)the development of the Project, together with the development of the remainder of
Tustin Legacy, will contribute to the need for Tustin Legacy backbone infrastructure located off
of the Development Parcels, including Tustin Legacy roadway improvements; traffic and
circulation mitigation to support the Tustin Legacy project; domestic and reclaimed water;
sewer; telemetry; storm drains and flood control channels; utilities backbone (electricity, gas,
telephone, cable, telecommunications, etc.) (as such program is in effect as of the Effective Date,
Tustin Legacy Backbone Infrastructure Program
the “”); (b)Developer shall make a fair
share contribution to development by the City of the Tustin Legacy Backbone Infrastructure
Program on behalf of the Project, as further described below; (c)Developer has had an
opportunity to review the budgets, plans and projections developed by the City in connection
with the Tustin Legacy Backbone Infrastructure Program and the studies prepared by the City in
connection therewith; (d)there is an essential nexus between the imposition on the Project of the
Project Fair Share Contribution and a legitimate governmental interest; and (e)the Project Fair
Share Contribution is roughly proportional to and reasonably and rationally related to the
impacts that will be caused by development of the Project.
Project Fair Share Contribution
8.7.2..Developer shall pay its fair share of
the Tustin Legacy Backbone Infrastructure Program, which is equal to Sixteen Million Nine
Hundred Thirty Four Thousand Seven Hundred and Four Dollars ($16,934,704)as further
Project Fair Share Contribution
described in this Section 8.7.2 (the “”):
(a)Provided that upon Recordation the Final Map contains 375 single
family Lots, the amount due as a condition to building permit issuance for each Home shall be
Forty Five Thousand One Hundred Fifty Nine and 21/00 Dollars ($45,159.21). In the event the
Final Map consists of more or less than 375 single family residential Lots, the Project Fair Share
Contribution per Home shall be calculated by dividing $16,934,704by the number of single
family residential Lots shown on the Final Map.
(b)Until the Initial Channel Condition has occurred(as described in
Section 8.10.3), the Project Fair Share Contribution shall be paid byDeveloperon a per Home
basis as a condition to the issuance of a building permit for each Home developed within the
Development Parcels.Upon occurrence of the Initial Channel Condition, the payment of the
Project Fair Share Contribution for the remainder of the Homes within the Project shall be fully
Lump Sum Payment
due and payable to the Cityas a lump sum (the “”) withinthirty(30)
Business Days following delivery by the Cityof written notice that the Initial Channel Condition
has occurred. The Lump Sum Payment shall be equal to the difference between $16,934,704and
the amount of the Project Fair Share Contribution previously paid by Developer to the City.
(c)The Project Fair Share Contribution is an independent obligation
of Developer that is due and payable with respect to and in accordance with the terms of this
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Agreement in addition to and not as a component of the Base Purchase Price and/or the Profit
Participation Price.
Community Facilities District Formation
8.7.3..Developer, on behalf of itself
and itsSuccessor Owners, agrees to theimposition of an assessment district or community
facilities district with respect to the Development Parcels and the Improvements (the
AD/CFD
“”).The City shall have the right to establish the AD/CFD in its sole discretion.
(a)The AD/CFD will have two components, as follows:
Tax A
(i)Special Tax “A” (“”)the proceeds of which may be
used by the City for any lawful purpose, and
Tax B
(ii)Special Tax “B” (“”), the proceeds of which shall be
used by the City to fund a portion of the City essential services, including
police and fire protection, ambulance and paramedic services, recreation
programs and services, street sweeping, traffic signal maintenance and the
maintenance of City-owned parks, parkways and open spaces, lighting,
flood control and storm drain services and other City services and
facilities at Tustin Legacy.The term of Tax B imposed upon the
Development Parcels and theImprovements shall be perpetual and shall
not be time limited in any manner unless determined by the City in its sole
discretion.
(b)Attached hereto as Attachment 24is a Tax Burden Schedule which divides
the Homes to be constructed on the Development Parcels into six classes based upon the square
footage of each Home, together with the maximum tax amount which may be imposed upon each
Home within each class for Tax B, and the aggregate tax amount for each Home for Tax A and
the TUSD CFD combined. Notwithstanding anything to the contrary set forth in this Section
8.7.3, the annual property tax burdenoneach Homefor Tax B and on each Home for Tax A and
the TUSD CFD combined, shall not exceed theamountsshown on the Tax Burden Schedule for
the applicable tax. Such taxes may thereafter be adjusted upward at two percent (2%) per year as
further described in the rate and method of apportionment.Nothing in this Agreement shall
preclude each of the City and TUSD from creating or issuing one or more community facility
districts or assessment districts with respect to the Development Parcels for the purposes
enumerated in this Section 8.7.3 provided that the total aggregate tax amount for all such districts
does not exceed the amounts described in this Section 8.7.3.
(c)Ifthe conditionsset forth in Section 7.2.2(g) havenot been
satisfied prior to Close of Escrow, Developer agrees that it shall affirmatively support the
formation of each of the AD/CFD and the TUSDCFD,provided that each is proposed consistent
with the requirements of this Section8.7.3. Developer further specifically agrees that following
the Close of Escrow, itshall timely take all actions requested by the City and TUSD in order to
support formation of each of the AD/CFD and TUSD CFD meeting the requirements of this
Section8.7.3, at no material out-of-pocket cost or expense to Developer.In the event of a CFD
Default,the City shall have the remedies set forth in Section 16.7and if Developer shall fail to
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pay the CFD Liquidated Damages when due, shall in addition have the other remedies described
in this Agreement, including Sections16.3 and 16.4.
(d)At the sole discretion of the City,the AD/CFD maybe structured
such that assessments shall be due and payable with respect to the DevelopmentParcels without
consideration for whether or not Homes have been Completed thereon(i.e., such that all Lots
shall be assessed as improved or developedproperty); provided however, the AD/CFD
assessment on unimproved land or undeveloped portions of the Property shall be at an
undeveloped property assessment rateof Zero Dollarsuntil the Initial Channel Condition has
occurred.
(e)The City will provide Developer with the opportunity to review
and provide input on all documents and budgets relating to the formation of the AD/CFD
(including any funding and acquisition agreement and the rate and method of allocating Tax A
and Tax B) at least thirty (30)days prior to the date on which the formation documents are
expected to be submitted for the agenda package for the first public hearing related to the
formation of the AD/CFD.
(f)The City and Developer agree that the foregoing Tax A and Tax B
are imposed by the City in its Proprietary Capacity as seller under this Agreementand not in its
Governmental Capacity and that Tax A and Tax B shall additionally be a Public Benefit under
the DA madeapplicable to the Property and the Improvements thereon and shall be a tax and lien
upon the Property in accordance with the terms of the instruments governing the AD/CFDand
the requirements of the DA.The agreement of Developer to imposition of the AD/CFD on the
terms set forth above and the payment of such proceeds to the City constitutes additional and
material consideration to the City under this Agreement. In addition to the requirements in this
Agreement, the establishment of the CFD and assessments imposed thereby and the proceeds of
any bonds issued in connection therewith shall be payable to the City as Public Benefitsunder
the DA.In addition to the remedies imposed pursuant to this Agreement in favor of the City,
nothing herein shall restrict the right of the Cityto exercise its remedies under the DA and to
withhold building permits with respect to the Project pursuant to the DA if Developer fails to
either (A)timely comply with its obligations with respect to the AD/CFD or the TUSD CFDor
(B) pay the applicable CFD Liquidated Damages when due.
(g)Developer will not oppose a determination by the City to form the
AD/CFD,includinga determination to subjectall or any portion of the Development Parcels and
the Improvements thereon to such assessment,provided that the City, the AD/CFD and such
assessments comply with clauses (a), (b), (d)and(e)above.Developer will not oppose a
determination by Tustin Unified School District to form the TUSD CFD, includinga
determination tosubjectall or any portion of the Development Parcels andthe Improvements
thereon to such assessment,provided that the TUSD CFDcomplieswith clause (b)above.
(h)There shall be no tax or other financial burden imposed on the
Development Parcels or the Improvements thereon on account of the AD/CFD or any similar
taxing authority such as a School Facility Improvement Districtformed by the City or any
agency or instrumentality of the City or Controlled by the City, other than Tax A and Tax B, and
Tax A and Tax B shall be in lieu of any other assessments, special taxes, fees or charges that
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may otherwise be charged on account of the types of services covered thereby. Notwithstanding
the foregoing sentence, the City shall not be prohibited by the terms of this Agreement from
subjecting the Development Parcels to any increase in ad valorem real property tax pursuant to a
City of Tustin-wide election, provided that nothing herein shall be construed to constitute a
waiver by Developer of its right or ability to dispute or oppose passage of a City of Tustin-wide
bond, the proposed formation of any special district or taxing authority in connection therewith,
or the imposition of any such tax, or its right to dispute any portion of the Development Parcels’
assessed value.
Master Marketing Program Fees
8.7.4..Developer acknowledges that the
City (in its Proprietary Capacity) requires that all builders within Tustin Legacy contribute a
master marketing fee towards the marketing of Tustin Legacy by the City. In complete
satisfaction of such obligation by Developer, Developer shall pay to the City through Escrow
Holder at the Close of Escrow a one-time master marketing fee of Fifty Thousand Dollars
($50,000.00). The City acknowledges and agrees that this payment shall satisfy all obligations
of Developer to contribute to the master marketing program or any future master marketing
program and that Developer shall have no additional obligations on account thereof after the
payment of such fee at the Close of Escrow.
Other Fees and Assessments
8.7.5.. Developer acknowledges and agrees that
in addition to City fees, fees may be imposed by other Governmental Authorities with
jurisdiction over the Project and/or the Property and payment of any such fees and assessments
shall be at Developer’s sole cost, including the Foothill/Eastern Corridor Fee, the Santa
Ana/Tustin Transportation System Improvement Area (TSIA) fee, state-mandated school impact
fees by the Tustin Unified School District, Orange County School Facility Bonds (Measure G
and Measure L), utility meter and connection fees. Developer also acknowledges that the
Development Parcels may be subject to a future community facilities district for financing of
school facilities to benefit Tustin pursuant to an agreement between the City and theTustin
Unified School District regarding the transfer of school sitesand Developer agrees that it shall
not challenge the establishment or the rate and method of apportionment of such community
facilities district so long as the TUSD CFD and Tax Ado not in the aggregate exceed thetax
rates described in Section 8.7.3(b)and Tax B does not exceed the tax rate described in Section
8.7.3(a)(ii).The City will provide Developer with the opportunity to review and provide input
on all documents and budgets relating to the formation of the TUSD CFD (including any funding
and acquisition agreement and the rate and method of allocatingsuch CFD)promptly upon its
receipt of same and, to the extent it receives such documents in sufficient time to do so, shall
provide Developer at least thirty (30)days prior to the date on which the formation documents
are expected to be submitted for the agenda package for the first public hearing related to the
formation of the TUSD CFD.
Quimby Fees and Park Fees
8.7.6.. All fees required in connection with the
Project pursuant to the Quimby Act, California Government Code Section66477 are included
within the Project Fair Share Contribution and Developer shall not have any additional liability
on account thereof. In consideration of Developer’s construction of Park Facilities, as set forth
in Tustin Code Section 9331(d), Developer shall have no obligation to pay any park fees or
develop any park facilities (other than the Park Facilities) in connection with the development of
the Project.
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Final Map
8.8.. Developer shall submit the Final Map to the City for approval and
shall enter into the Subdivision Improvement Agreement with the City prior and as a condition to
issuance by the City of building permits for any Homes, including Models.
Construction of ImprovementsbyDeveloper.
8.9.
Horizontal Improvements
8.9.1.. Developer acknowledges and agrees that it
shall be responsible for design and construction of all local infrastructureto support the
development of theProject as further described in the Schedule of Performance and the Scope of
Development, includingthe Horizontal Improvements and the On-Lot Improvements.Developer
shall promptly obtain permits for the Grading Work and additional Horizontal Improvementsand
begin construction thereof and thereafter shall diligentlyprosecute such work to Completion in
accordance with and subject to this Agreement, including the Schedule of Performance,the
Approved Plans, the Specific Plan, the Tentative Tract Map, Entitlement conditions,
Development Permitsandany other Governmental Requirements.The Landscape
Improvements shallinclude vegetation of a type and amount as may reasonably be required to
maintain landscaping consistent with High Quality Residential Standards.To secure
Developer’s performance of the Grading Work, prior to the Close of Escrow, Developer shall
provide one or more Performance Bonds securing its obligations to construct the Grading Work.
To secure Developer’s performance of the remainder of the Horizontal Improvements, prior to
the earlier of (a) eight (8) months following Close of Escrow and (b) the date set forth in the
Subdivision Improvement Agreement for provision of bonds,but in all cases, prior to issuance of
the first permit for the construction of Horizontal Improvementsother than the Grading Work,
Developer shall provide one or more Performance Bonds securing its obligations to construct the
remainder of the Horizontal Improvements.
Vertical Improvementsand On-Lot Improvements
8.9.2..Developer shall
construct the On-Lot Improvements and shall construct the Vertical Improvements for residential
purposes in accordance with this Agreement,including the Schedule of Performance,the
Approved Plans, the Specific Plan, the Tentative Tract Map, Entitlement conditions,
Development Permitsandany other Governmental Requirements.Developer shall also comply
with the following requirements with respect to its development of the Vertical Improvements on
Inventory Commitment
the Development Parcels (collectively, the “”):
(a)Construction of Models.Subject to Section 14.2.6(a), commence
construction of Modelson the Development Parcels within one (1) month followingCity
issuance of building permits but in no event later than the earlier of (x) three (3) months
following completion of all Horizontal Improvements other than the Park Facilities and (y) thirty
six (36) months following the Close of Escrowand Complete construction of and open Models
and Park Facilities, including amenities, to the public, within the earlier of (A) forty-two (42)
months following the Close of Escrow or (B) six (6) months following the completion of all
Horizontal Improvementsother than the Park Facilities,provided that Force Majeure Delays
with respect to the foregoing shall not exceed twelve (12) months in the aggregate.Model Home
construction on the Development Parcelsto consist offour (4) Modelcomplexes (12 Models)
representative of Homes in each of the four product types proposed to be constructed as part of
the Project.The Modelcomplexes shall be constructed and completed prior to completion of
Homes within the first area of the Property to be developed. Each Modelcomplex shall open to
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the public promptly upon completion thereof and shall remain opento the public until such time
that Developer has sold ninety-five percent(95%) of the Homes of such product type within the
Property;
(b)Initial Product Inventory.Subject to extension for Force Majeure
Delay, Complete construction of initial production home inventory within four (4) months
following Completion ofthe ModelsandthePark Facilities.Initial product inventory
requirement shallconsist of completion offraming and exteriors for not less thanfour (4)Homes
of each product type (for a total of 16 Homes) available for sale in addition to the Models;
(c)Ongoing Inventory and Production Phase Requirements.
Construct, obtain valid certificates of occupancy and offer for sale the Homes in production
phases which are based upon a reasonable analysis of market conditions and anticipated
absorption and which otherwise are inconformance with the Schedule of Performance.Taking
into consideration the market conditions and anticipated absorption, use commercially
reasonable efforts to commence construction of each subsequent production phase of Homes not
later than the close of escrow on the last Home for sale to the public in the prior production
phase.Developer will be limited to issuance of 242 building permits for Homes until the Initial
Channel Condition has occurred.
(d)Marketing.Conduct reasonable marketing efforts in conformance
with Developer’s master marketing program, to sell all of the Homes;
(e)Maximum Release.Except as may from time to time be
specifically agreed in writing by City, not release for sale to the public in one sales release for
any one product type more than fifteen (15)Homes; and not release a second or later sales
release of Homes within thirty (30) calendar days of the immediately prior sales release.
Tustin Legacy Backbone Infrastructure Program
8.10..
City Backbone Improvements
8.10.1..City shall use commercially reasonable
efforts to approve the plans (a) for the City Backbone Improvements within Moffett Drive and
Park Avenue by the later of (i) four (4) months following Close of Escrow or (ii) July 31, 2014
and (b) for the Channel Improvementsby April 30, 2015, such that the Channel Improvement
plans may be submitted toOCFCD.Cityshall use commercially reasonable efforts, subject to
availability of funds, to obtain license and entry permits from OCFCD necessary or reasonably
desirable in connection with the Channel Improvements and to construct the City Backbone
Improvements as further described on Attachment 19. City intends to obtain permits, construct
and complete the City Backbone Improvements in accordance with the schedule attached hereto
as Attachment 19.Notwithstanding anything to the contrary set forth in this Agreement,
Developer acknowledges that such schedule is an estimate only and failure of the City to
commence the Initial Channel Condition, or carry out the tasks described in this Section, or to
perform in accordance with such schedule for any reason shall not be a default under this
Agreementand Developer’s sole right with respect to such inaction by the City shall be that the
time period for performance of Developer’s obligations with respect to construction, completion
and sale of more than 242 Homes within the Project,and theScheduleof Performance and
Inventory Commitment with respect thereto shall be extended as described in Section 8.10.3.
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Earmark of Funds
8.10.2..The City shall establish a separate account in the
City’s accounts, books and records for the Project Fair Share Contribution,which shall be
dedicated by the City for construction of the City Backbone Improvementsuntil the earlier of
completion of the City Backbone Improvementsor the termination of this Agreement.
Channel Improvements
8.10.3.. The City is a party to that certain Joint
Cooperation Agreement with OCFCD dated March 11, 2003, as amended,relating to
improvements to Peters Canyon Channel, which provides that no more than 1,000 residential
unitswithin the former master developer footprint of Tustin Legacy that drains to Peter’s Canyon
Channel may be occupied prior to commencement of additional improvements to Peters Canyon
Channel. Developer acknowledges and agrees that pursuant to the terms of the DA and the
nd
Entitlements,from and after issuance of the 242building permit, the City shall not issue
building permits for further Homes until the followinghas occurred:(a) a contract has been let
by City for the Channel Improvements and (b) construction of the Channel Improvements have
Initial Channel Condition
commenced(collectively, the “”).Notwithstanding anything to the
contrary set forth in this Agreement, if the Initial Channel Conditiondoes not occurprior tothe
rd
later of (i) Developer’s request for the 243building permitand (ii)December 30, 2015(the
Channel Condition Satisfaction Date
“”), then any and all of Developer’s obligations with
respect to the Schedule of Performance, Inventory Commitment and the construction,
Completion and sale of more than 242 Homes within the Project shall be extended (a) on a day
for day basis foreach day following the Channel Condition Satisfaction Datefor which the
Initial Channel Condition has not occurredand (b) if 180 or more Homes have been Completed
as of the date that the Initial Channel Conditionhas occurred, an additional four (4) months.
Following the Effective Date, the City shall not enter into anynew agreement for the
development of new residential units within Tustin Legacythatpermits commencement of
residential units before the Initial Channel Conditionhas occurred.The Parties acknowledge that
the City has previously granted rights to develop 758residentialunits to other developers within
Tustin Legacy that are not restricted by this requirementand nothing herein shall restrict the
rights of developers under agreements previously entered into by the City, from constructing
residential units.
Outside Date of Completion of Construction
8.11..
Notwithstanding any other provision of this Agreement, Developershall be obligated to
Complete the Project (including the Horizontal Improvements, On-Lot Improvements, Vertical
Improvementsand all of the Homes) withinthe earlier of (a) sixty (60) months following
opening of the Models to the public, as such date may be extended for a maximum total of
th
twelve (12) months following the 60month for Force Majeure Delay or (b)eighty-four (84)
months after Close of Escrow,provided that the foregoing period to Complete may be extended
th
for a maximum total of twelve (12) months following the 84month for Force Majeure Delay.
Development Covenants.
8.12.
With respect to construction of the Improvements and the Project, Developer hereby
covenants and agrees as follows:
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(a)Developer shall maintain throughout the term of this Agreement,
sufficient equity, capital and firm binding commitments for financing necessary to (i) pay
through Completion, all costs of development, construction, marketing, sale and/or leasing,
operation and management of all the Improvements as defined in the Scope of Development
without Mortgage; and (ii) enable Developer to perform and satisfy all the covenants of
Developer contained in this Agreement and the Special Restrictions. No successor-in-interest to
Developer (including any Builder Transferee) shall undertake any additional project if it could
reasonably be expected to jeopardize the sufficiency of any equity, capital and firm and binding
commitments for the purposes expressed in the preceding sentence.
(b)The development of the Project shall be done in a professional and
competent manner. Developer shall perform all work required to construct and Complete the
Improvements and the Project and related work in accordance with the Approved Plans and all
Governmental Requirements and at the level of quality set forth in the Scope of Development.
(c)Developer shall be responsible for the timeliness and quality of all
work performed and materials and equipment furnished in connection with the Project, whether
the work, materials and equipment are performed and furnished by Developer or through
contractors, subcontractors (of all tiers) and suppliers.
(d)Developer shall not place, or allow to be placed, on its interests in
the Property, Improvements, or any portion thereof, any Mortgage or encumbrance of lien not
authorized by this Agreement.
(e)Developer shall, within thirty (30) calendar days following receipt
of notice thereof, cause to be removed or bonded against (such bonding to be by the provision of
bonds satisfying California statutory requirements) any and all mechanic’s liens, stop notices
and/or bonded stop notices that are recorded and/or served by contractors, subcontractors (of all
tiers) and suppliers in connection with the Project. Notwithstandingthe foregoing, Developer
may contest the amount, validity or application, in whole or in part, of any such mechanic’s
liens, stop notices and/or bonded stop notices; subject to the further requirement that neither the
Property nor any Improvements nor anypart or interest in either thereof would be in any danger
of being sold, forfeited, attached or lost pending the outcome of such proceedings. If any such
contest is finally resolved against Developer, Developer shall promptly pay the amount required
to be paid, together with all interest and penalties accrued thereon. Developer hereby agrees to
indemnify, defend(and hold the City Indemnified Parties free and harmless from and against any
and all Claims arising from failure to pay for construction of Improvements or other work related
to the Project including costs to remove or bond mechanic’s liens, stop notices and/or bonded
stop notices that are recorded and/or served by contractors, subcontractors (of all tiers) and
suppliers with respect to construction of Improvements or performance of work with respect to
the Project. Subject to Section 9.7 of this Agreement, the indemnity set forth in this Section shall
survive the termination of this Agreement.
(f)Subject to Section 8.2.1 and Section 17.7, Developershall,
following the Close of Escrow, commence the development of the Project promptly and shall
diligently pursue to Completion and shall Complete development of the Project and the
Improvements in accordance with the time periods in the Schedule of Performance and in all
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events, on or before the dates set forth for Completion of the Project set forth in the Schedule of
Performance.
City Rights of Access
8.13..
In addition to any rights it may have in its Governmental Capacity, representatives of the
City shallhave the reasonable right of access to all portions of theProperty and the
Improvements (other than Improvements owned by Homebuyers), without charges or fees, at
normal construction hours during the period of construction for the purposes of this Agreement,
including the inspection of the work being performed in constructing the Improvements. The
City agrees to indemnify, defend and hold Developer harmless for any and all Claims, arising out
of any such non-governmental inspection or other activity on theProperty, the Improvements or
the Project by the City, or its agents, employees or contractors permitted pursuant to this
Section8.13, except to the extent caused by the gross negligence or willful misconduct of
Developer.
Disclaimer of Responsibility by City and Exculpation
8.14..
Disclaimer of Responsibility
8.14.1.. The City neither undertakes nor assumes
nor will have any responsibility or duty to Developer, any Successor Owner or to any other third
party to review, inspect, supervise, pass judgment upon or inform Developer, any Successor
Owner or any third party of any matter in connection with the development or construction of
Improvements, whether regarding the quality, adequacy or suitability of the plans, any labor,
service, equipment or material furnished for development of the Project, any Person furnishing
same, or otherwise. Developer, any Successor Owner and all third parties shall rely upon its or
their own judgment regarding such matters, and any review, inspection, supervision, exercise of
judgment or information supplied to Developer, any Successor Owner or to any third party by
the City in connection with such matter is for the public purpose of developing the Project, and
neither Developer nor any Successor Owner nor any third party is entitled torely thereon.
Exculpation
8.14.2..The City shall not be liable in damages to Developer or to
any owner, lessee, any licensee or other Person, on account of (a) any approvals or disapproval
by the City, including by the City Manager or designee,whether made in the Governmental
Capacity or Proprietary Capacity of the City of any design documents, including the Approved
Plans, any Basic Concept Planand grading plans for the Grading Work, whether or not defective
or whether or not in compliance with applicable laws or ordinances; (b) any construction,
performance or nonperformance by Developer or any owner, lessee, licensee or other Person of
any work on the Propertyor the Improvements, whether or not pursuant to Approved Plans or
whether or not in compliance withapplicable laws or ordinances; (c) any mistake in judgment,
negligence, action or omission in exercising its rights, powers and responsibilities hereunder;
and/or (d) the enforcement or failure to enforce any of the provisions of this Agreement. Every
Person who makes design submittals for approval agrees by reason of such submittal, and
Developer and every Successor Owner of the Property or the Improvements or any portion
thereof agrees by acquiring title thereto or an interest therein, not to bring any suit or action
against the City seeking to recover any such damages and expressly waives any such claim or
cause of action for such damages which it would otherwise be entitled to assert. The review of
any design submittals shall not constitute the assumption of any responsibility by, or impose any
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liability upon, the City as to the accuracy, efficacy, sufficiency or legality thereof nor decrease or
diminish any liability, duties, responsibilities, or obligations of Developer under this Agreement
or otherwise.
City Responsibility
8.14.3.. Nothing in this Section 8.14shall limit the City’s
express representations, warranties, covenants and obligations set forth in this Agreement and the
Other Agreements.
No Supervision or Control
8.14.4.. The City (whether acting in its
Governmental Capacity or its Proprietary Capacity) does not have any right, and hereby
expressly disclaims any right, of supervision or control over the architects, designers, engineers
or persons responsible for drafting or formulating of the plans, drawings and related documents
of Developer.
Survival
8.14.5.. The provisions of this Section 8.14shall survive the termination
of this Agreement.
Local, State and Federal Laws
8.15..
Developer shall carry out the construction of the Project, including all Improvements,
subject to Section 8.1.4 and in conformity with all Governmental Requirements (subject to
Section 1.6 of this Agreement) including all applicable federal and State labor laws and
regulations and shall investigate the applicability of and, if and to the extent applicable, pay
prevailing wages meeting the requirements of such laws and regulations; provided that
Developer reserves the right to reasonably contest such laws and regulations. Developer hereby
agrees that, with respect to the Project, Developer shall be fully responsible for determining
whether the foregoing wage requirements are applicable and agrees to indemnify, defend and
hold the City and its elected and appointed officials, employees, agents, attorneys, affiliates,
representatives, contractors, successors and assigns free and harmless from and against any and
all Claims arising from or related to compliance by Developer or Developer’s officers, directors,
employees, agents, representatives, consultants and/or contractors (at every tier) in construction
of the Project with the prevailing wage requirements imposed by any applicable federal and State
labor laws. The indemnity set forth in this Section shall survive the termination of this
Agreement.
Liens, Taxes and Assessments
8.16..
Developer shall pay prior to delinquency all real estate taxes and assessments assessed
and levied on or against all portions of the Property or the Improvementsduringthe period of
ownershipthereof by Developer. Developer shall not place, or allow to be placed, on its
interests in the Property, or any Lot or Home, or any portion thereof, any Mortgage or
encumbrance of lien not authorized by this Agreement. Developer shall remove, or shall have
removed, any levy or attachment made on its interests in the Property or the Improvements (or
any portion thereof), or shall assure the satisfaction thereof within thirty (30) calendar days
following receipt of notice thereof. Except as set forth in Section 8.7.3(h), nothing contained in
this Agreement shall be deemed to prohibit Developer from contesting the validity or amount of
any tax or assessmentor to limit the remedies available to Developer in respect thereto.
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Developer hereby agrees to indemnify, defend and hold the City and its elected and appointed
officials, employees, agents, attorneys, affiliates, representatives, contractors, successors and
assigns free and harmless from and against any and all Claims arising with respect to payment of
liens, taxes and assessments assessed or levied against the Property and/or theImprovements
during the period of ownership thereof by Developer. Theindemnity set forth in this Section
shall survive the termination of this Agreement.
City Additional Covenants
8.17..
Dedication and Completion of Public Roads
8.17.1.. Prior to the Close of
Escrow, the City shall cause Moffett Driveand Park Avenue to be properly dedicated as public
roads. The City shall cause that portion of Park Avenue depicted on Attachment 21to be cap
paved prior to Developer’s opening of the first Model, provided however,in no event shall the
dedication and cap paving of Park Avenue be completed prior to the opening of the residential
development on Parcel 1A North (St. Anton). Promptly following completion of construction of
the roads surrounding the Development Parcels, the City shall properly dedicate such roads as
public roadways.
Third Party Licenses
8.17.2.. At no cost to the City, the City shall assist and
cooperate with Developer to obtain from other Persons (including IRWD and the City of Irvine)
any licenses or entrypermits necessary or reasonably desirable in connection with Developer’s
development of the Horizontal Improvements.
Release Language
8.17.3.. In connection with its sale of property at Tustin
Legacy for purposes of construction and sale of Homes, the City shalluse commercially
reasonable efforts to incorporate in each disposition and development agreement and quitclaim
deed or other recorded document, release provisions substantially similar to those set forth in
Section 4.5.2(f) and the Quitclaim Deed. Thefailure of the City to do so shall not relieve
Developer, andany Successor Owner, of its obligations to include the release provisions in
future deedsto Homebuyers pursuant to the Quitclaim Deed.
Certificate of Compliance
9..
Completion; Schedule of Performance
9.1..
Subject to Section 17.7, following the Close of Escrow, Developer shall construct the
Project and shall satisfy all Conditions Precedent relating to issuance of the Certificate of
Compliance for the Project when and as required by this Agreement in accordance with the
Schedule of Performance.
Certificate of Compliance Defined
9.2..
After Completion of all construction and development required to be undertaken by
Developer in conformity with this Agreement and in accordance with the Schedule of
Performance and the satisfaction by Developer of the Conditions Precedent set forth in
Section9.3, the City shall deliver to Developer or Successor Owner owning fee title to the
Certificate of Compliance
Development Parcels a “” for the entirety of the Project. The
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Certificate of Compliance shall be substantially in the form and substance of the Certificate of
Compliance set forth on Attachment15and in such form as to permit the Certificate of
Compliance to be Recordedagainst the entirety of the Property.Developer, on behalf of itself
and SuccessorOwners and each and every Person claiming by, through or under Developer or
any Successor Owner,hereby consents to the recordation of the Certificate of Compliance
against the entirety of the Property, notwithstanding that portions orall of the Property may have
been transferred prior thereto to Successor Owners, including Homebuyers or to a Homeowners’
Association, and confirms that no further acknowledgement or consent by the then-owners of the
Property shall be required in connection with such Recordation.
Conditions Precedent for Certificate of Compliance
9.3..
The City shall not be obligated to issue the Certificate of Compliance for the Project,
unless and until each of the following has occurred:
(a)Completion of the Improvementsand satisfaction of all obligations
of Developer under the Soil License Agreement;
(b)Final inspection of the Development Parcels and the Improvements
by or on behalf of the City and determination by the City that the Project and all Improvements
have been Completed in conformance with this Agreement, including the Approved Plans and all
Governmental Requirements;
(c)Issuance of a the final certificate of occupancy by the City for all
Homes within the Project, which shall be equal in number to the number of residential Lots
shown on the Final Map;
(d)Release or bonding in accordance with California law of all liens
or rights to record liens from the general contractor and all subcontractors(at all tiers)having
served valid preliminary 20-day notices, and the statutory period for filing liens having expired;
(e)Recordation of the CC&Rs against the Development Parcels and
with respect to those Lots owned by Developer at the time of Developer’s request for the
issuance of a Certificate of Compliance, confirmation that all liensof record as of the date of the
request for the Certificate of Compliance are junior andsubordinate to the Recorded CC&Rs;
(f)Payment of the Interim Payment (as defined in the Profit
Participation Agreement) required by the Profit Participation Agreement in an amount equal to
75% of the Estimated Total Profit Participation (as defined in the Profit Participation Agreement)
and (b) a payment bond in an amount equal to 25% of the Estimated Total Profit Participation
from a surety reasonable acceptable to City, and in form reasonably acceptable to City, to secure
Developer’s obligations to pay the remaining Profit Participation, if any;
(g)Payment by Developer to the City of all funds then owing to the
City under this Agreement and, if applicable, the Other Agreements; and
(h)No Potential Default or Material Default by Developer under this
Agreement shall have occurred and be continuing.
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Conclusive Presumption
9.4..
The Certificate of Compliance shall be, and shall so state, conclusive determination of
satisfactory completion of the obligations of Developer pursuant to this Agreement.
Not Evidence
9.5..
Issuance by the City of a Certificate of Compliance is not notice of completion as
referred to in Section8182of the California Civil Code.
City Obligations
9.6..
The City shall not unreasonably withhold or delay issuance of the Certificate of
Compliance. If the City refuses or fails to issue such Certificate of Compliance after written
request from Developer, provided each of the conditions established in Section 9.3 have been
satisfied, the City shall, within fifteen (15) Business Days of the written request, provide a
written statement which details the reasons the City refused or failed to issue the Certificate of
Compliance. The statement shall also contain a statement of the actions that Developer must
take to obtain the Certificate of Compliance.The City shall cause the Certificate of Compliance
to be Recorded within five (5) Business Days after issuance.
Effect of Certificate of Compliance; Termination of Agreement
9.7..
After the Recording of the Certificate of Compliance, except as set forth below,
the DDA shall terminate and any Person then owning or thereafter purchasing, leasing, or
otherwise acquiring any interest in the Development Parcels subject to the Certificate of
Compliance shall not (because of such ownership, purchase, lease or acquisition) incur any
obligation or liability under this Agreement with respect to such Improvements, except that the
Quitclaim Deed, the Profit Participation Agreement, the Special Restrictions, the CC&Rs,and
the Landscape Maintenance Agreement shall each remain in effect for the term specified therein.
Issuance of the Certificate of Compliance shall not waive any rights or claim that the City may
have against any party for latent or patent defects in design, construction or similar matters under
any applicable law, nor shall it be evidence of satisfaction of any of Developer’s obligations to
others not a party to this Agreement. The Certificate of Compliance shall be in such form as to
permit it to be Recorded. Upon Recordation of the Certificate of Compliance, this Agreement
shall terminate, except that:
(a)the provisions of Section 4.5.2, including the release set forth
therein, as and to the extent set forth inthe Quitclaim Deed shall survive in perpetuity, shall run
with the land and shall be binding upon Developer and its Successors Ownersincluding
Homebuyers and other End Users;
(b)the provisions of Section 11.1.4 shall survive until the expiration of
the timeperiod for provision of the environmental insurance policy described thereby; and the
obligation to provide such insurance policy shall remain in effect for a period of ten (10) years
from Close of Escrowand shall (i) continue to run with the land owned by Developer and
Successor Owners and not then conveyed to any Homebuyer or other End User and (ii) bind
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Developerand its successors and assigns and each and every prior Developer not released by the
City pursuant to Section 2.2.3(a)(iii), provided that upon sale or transfer to any Homebuyer or
any other End User, such obligation shall not run with the land or survive with respect to or bind
any such Homebuyer or End User or any of their respective successors and assigns;
(c)the indemnities set forth in Sections 5.5, 8.12(e), 8.15, 8.16, 10.1,
10.2 and 17.12.1shall remain in effect as and to the extent set forth in Section10.3; provided
that upon sale or transfer to any Homebuyer or any other End User, such obligation shall not run
with the land or survive with respect to or bind any such Homebuyer or End User or any of their
respective successors and assigns;
(d)any and all obligations contained in the Federal Deed shall survive
in perpetuity to the extent set forth therein, unless such obligations are released by the Federal
Government; and
(e)Developer shall not modify or terminate any prepaid
environmental insurance policy in effect as of the issuance of the Certificate of Compliance.
Notwithstanding anything to the contrary set forth in this Agreement, theprovisionsof
this Section 9.7 shall survive the termination of this Agreement and the Recording of the
Certificate of Compliance and shall be binding upon Developerand Developer’s successors and
assigns and each and every prior Developer (unless released by the City pursuant to Section
2.2.3(a)(iii)or Section 16.6),the Development Parcels and the Improvementsfor the term set
forth above, but except as set forth in the Quitclaim Deed, shall not be binding on End Users.
Indemnification and Environmental Provisions
10..
Developer’s Indemnification
10.1..
As a material part of the consideration for this Agreement, effective upon Close of
Escrow, and to the maximum extent permitted by law, Developer shall indemnify, protect,
defend, assume all responsibility for and hold harmless theCity Indemnified Parties, from and
against any and all Claims to the extent caused by the following:
(a)Developer’s marketing, sale or use of the Property in any way;
(b)All acts and omissions of Developer in connection with the
Project, the Property, the Improvements or any portion of any of the foregoing;
(c)Any plans or designs for Improvements prepared by or on behalf
of Developer, including any errors or omissions with respect to such plans or designs;
(d)Any loss or damage to the City resulting from any inaccuracy in or
breach of any representation or warranty of Developer, or resulting from any Default, including
Material Default, by Developer, under this Agreement;
(e)the non-performance or breach by Developer or the Developer
Representatives, of any term or condition of this Agreement; or
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(f)Any development or construction of Improvementsor other
structures or facilitiesby Developer or Developer’s Representatives, whether regarding the
quality, adequacy or suitability of any labor, service, equipment or material furnished to the
Property, any Person furnishing the same, or otherwise.
Notwithstanding anything to the contrary set forth in this Section10.1, the foregoing
indemnities shall not apply to and Developer shall not be obligated to indemnify any of the City
Indemnified Parties with respect to the foregoing to the extent such Claims are a result of: (i)
any breach of any covenant or representation or warranty by City under this Agreement, (b) the
gross negligence, willful misconduct or fraud of City or any City Indemnified Party; or (c) any
other Claims against the City relating to or arising out of tort Claims brought by third parties
against Developer, to the extent such claims are based upon the Active Negligence of the City or
any City Indemnified Party and Accruingprior to the Close of Escrow.This indemnity shall
remain in effect for the period specified in Section 10.3 and shall be subject to the other terms set
forth therein.
Environmental Indemnity
10.2..
As a material part of the consideration for this Agreement, and effective as of the Close
of Escrow, Developer on behalf of itself and Successor Owners and each and every Person
claiming by, through or under Developer or any Successor Owner, hereby agrees that Developer
and each Successor Owner shall, to the maximum extent permitted by law, indemnify, protect,
defend, assume all responsibility for and hold harmless the City Indemnified Parties from and
against any and all Claims resulting or arising from or in any way connected with the existence,
Release, threatened Release, presence, storage, treatment, transportation and/or disposal of any
Hazardous Materials on, inor under the Property, or migrating from the Property to adjacent
properties regardless whether any such conditionis known or unknown now or upon acquisition
and regardless of whether any such condition pre-exists acquisition or is subsequently caused,
created or occurring; provided that neither Developer nor any Successor Owner shall be
responsible (and such indemnity shall not apply) to the extentof (a) any breach of any covenant
or representation or warranty by City under this Agreement, (b) the gross negligence, willful
misconduct or fraud of City or any City Indemnified Party, or (c)to the extent of the Active
Negligence or willful misconduct of the City or the City’s employees, contractorsor consultants
with respect to Hazardous Materials occurring prior to the Close of Escrowwith respect to work
performed by such Persons on the Development Parcels.This indemnity shall remain in effect
for the period specified in Section 10.3 andshall besubject to the other terms set forth therein.
This indemnity shall not be deemed to limit in any manner the rights and/or remedies thatCity,
Developer or Successor Ownersmay have against the Federal Governmentas described in
Section 4.1.
Duration of Indemnities
10.3..
Theindemnities set forth in Sections 5.5, 8.12(e), 8.15, 8.16, 10.1, 10.2 and 17.12.1 shall
run with the landand shall bind Developerand each and every Successor Owner;provided
however that upon sale or transfer of the fee interest in the Development Parcels or any portion
thereof to an End User, such indemnities shall terminate as to such End User and shall cease to
run with the land acquired by such End Useror any of their respective successors and assigns.
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Notwithstanding the foregoing, the obligations of Developer with respect to each of the
indemnities set forth in Sections 5.5, 8.12(e), 8.15, 8.16, 10.1, 10.2 and 17.12.1 shall(a) survive
the Close of Escrow and shallnot merge into the Quitclaim Deed, (b) survive the sale of land to
each End User and the issuance of the Notice of Completion,and (c) until the date that is ten (10)
years following issuance of the Certificate of Compliance, continue to bebinding upon
Developer and Developer’s successors and assigns and each and every prior Developer not
released by the City pursuant to Section 2.2.3(a)(iii) and each such party shall be jointly and
severally liable under such provisions with respect to theentirety of the Project and the Property,
but shall not be binding on any End User.Notwithstanding the foregoing, ifany portion of the
Property is subject to revesting or repurchase by the City, as to such portion of the Property the
foregoing indemnity shall apply only to the extent set forth in Section16.6.The provisions of
this Section 10.3 shall survive the termination of this Agreement.
Claim Response
10.4..
In the event that following the Close of Escrow, any Environmental Agency or other third
party brings, makes, alleges, or asserts a Claim, arising from or related to any actual, threatened,
or suspected Release of Hazardous Materials on or about the Property, including any Claim for
Investigation or Remediation on the Property, or such Environmental Agency or other third party
orders, demands, or otherwise requires that any Investigation or Remediation be conducted on
the Property, Developer shall promptly upon its receipt of notice thereof, notify the City in
writing and thereafter shall promptlyand responsibly evaluate and respond to such Claim as
provided in Section 10.5. Further, upon receipt of such Claim, order, demand or requirement,
Developer shall take such reasonable measures, as necessary or appropriate, to reasonably
dissuade such Environmental Agency or other third party from bringing, making, alleging, or
asserting any Claim against the City arising from or related to any actual, threatened, or
suspected Release of Hazardous Material on or about the Property, including any Claim for
Investigation or Remediation on the Property; provided that such obligation shall not apply to
those excluded Claims set forth as (a) through (c) of Section 10.2.
Release Notification and Remedial Actions
10.5..
If, after Close of Escrow, any Release of a Hazardous Material is discovered on the
Property,Developershall promptly provide written notice (or in the event of emergency,
telephonic notice, followed by written notice) of any such Release to the City. To the extent that
any Environmental Agency (otherthan the City) is requiring that the City Remediate such
Release and Developer acknowledges that it is obligated to assume responsibility or indemnify
the City with respect to such Release pursuant to Section 10.2 or there is a good faith dispute
between the City and Developer as to whether Developer is obligated to assume responsibility or
indemnify the City with respect to such Release pursuant to Section 10.2, thenDeveloper shall
(a) Remediate the Release in compliance with and to the extent required by Environmental Laws
and such Environmental Agency, or if such removal is prohibited by any Environmental Laws,
take whatever action is required by any Environmental Law and such Environmental Agency; (b)
take such other reasonable action as is necessary to have the full use and benefit of the Property
as contemplated by this Agreement; and (c) provide the City with satisfactory evidence of the
actions taken as required in this Section. To the extent that any Environmental Agency (other
than the City) is requiring that the City Remediate such Release and the City acknowledges that
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Developer is not obligated to assume responsibility or indemnify the City with respect to such
Release pursuant to Section 10.2 or no Environmental Agency (other than the City) isrequiring
that the City Remediate such Release, then (as between Developer and the City under this
Agreement) Developer may elect in its sole and absolute discretion whether to Remediate such
Release and/or pursue any rights that Developer has against anyPerson (including the Federal
Government and the City) with respect to such Release. The foregoing shall be without
prejudice to Developer’s or the City’s rights against any responsible party or against the Federal
Government pursuant to the Navy Responsibilities and without compromising the applicability
of any insurance coverage in regard to such Release. The City and Developerwill coordinate any
action required under this Section 10.5 with appropriate environmental insurance carriers so as
not to compromise coverage for the costs of such actions. Nothing set forth herein requires
Developer to perform any obligation of the Federal Government and nothing set forth herein
shall be deemed to limit or impair (or take any action that might limit or impair) in any manner
the rights and/or remedies that Developeror the City may have against the Federal Government
or any other third party.The foregoing shall not apply to the Returned Property after acquisition
thereof by the City.
Conflict with Section 330 and Other Federal Government Obligations
10.6..
Notwithstanding anything to the contrary contained in this Section 10, in the event that
any actions required to be taken by Developer pursuant to this Section 10 could potentially result
in Developer losing rights, or are contrary to any rights, which it otherwise would have pursuant
to the Navy Responsibilities or otherwise against the Federal Government, then the City and
Developer shall meet in order to determine the proper course of action to be taken by Developer.
The course of action to be agreed upon shall protect the City’s interest in the Project and Tustin
Legacy, while retaining for Developer its rights pursuant to the Navy Responsibilities or
otherwise against the Federal Government to the maximum extent reasonable under the
circumstances. Notwithstanding the foregoing, nothing set forth in this Section 10.6relieves
Developer with respect to Developer’s environmental responsibilities and obligations and
environmental indemnification of Developer to the City in this Agreement.
Insurance and Indemnification
10.7..
Notwithstanding anything contained herein and without limiting or relieving Developer
of its obligations to indemnify, defend and hold harmless the City Indemnified Parties under this
Agreement, the City agrees that with respect to any Claims tendered by any one or more of the
City Indemnified Parties under this Agreement for which Developer has the obligation to
indemnify the City pursuant to the terms ofthis Agreement, the City Indemnified Parties shall,to
the extent such insurance could reasonably be determined to be applicable to the type, extent,
value and/or location of the Claim being made,tender such Claim concurrently with the insurer
with respect to the environmental insurance policy required pursuant to Section 11.1.4 of this
Agreement and shall thereafter use reasonable commercial efforts to prosecute its Claim for
coverage with such insurer.To the extent that insurance is determined by the City not to be
reasonably applicable to the Claim or, if after six months, despite such efforts, insurance
proceeds are not available to cover all or a portion of the Claim or if such Claim is earlier denied
by the insurance carrier, Developer shall promptly pay to the City Indemnified Parties the Claim
amounts not then covered by the environmental insurance policy. Developer shall assist and
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cooperate with the City in its tender of Claims as required by this Section and shall pay in
accordance with the indemnity obligations of Developer, all staff and third party costs incurred
by the City pursuant to this Section.
Selection of Counseland Defense Obligations
10.8..
Defending Party
AParty that has an obligation to defend (“”) any other Party shall be
deemed to satisfy its defense obligations under this Agreement (where applicable) by assigning
counselofits choice and reasonably acceptable to the other Party, including with all the same
attorneys, paralegals, consultants, experts, vendors and others who are defending the Defending
Party, subject to the right of the indemnified Party, the City, City Indemnified Parties, the
Developeror the Developer Representativesentitled to defense, or any of them, as applicable
Defended Party
(the “”), to have separate counsel in the eventthat such counsel would be
Counsel
provided under cumis counsel standards applicable in the State(collectively “”). If
during any action in which Defending Party has defended the Defended Party, any Defended
Partydetermines, in its reasonable discretion, that separate counsel should be provided under
cumis counsel standards applicable in the State, Defending Party shall thereafter, at its own
expense and through separate counsel designated by DefendedParty and reasonably acceptable
to the DefendingParty, defend such Defended Party in such action, and the original Counsel
shall continue to represent Defending Party in that action.Each Defended Party agrees to
promptly notify Defending Party of any Claim or Action filed against the DefendedParty and to
cooperate in the defense of any such action.Failure of the Defended Party to notify the
Defending Party promptly of the filing of any Claim or Action shall offset the indemnification
obligations of the Defending Party only to the extent ofany prejudice to the Defended Party
caused by such failure to notify. The City retains the option to select and employ independent
defense counsel at its own expense. If both Parties elect to defend, the Parties hereby agree to
affirmatively cooperate in defending said action and to executea joint defense and
confidentiality agreement in order to share and protect information, under the joint defense
privilege recognized under applicable law. As part of the cooperation in defending an action, the
City and Developershall coordinate their defense in order to make the most efficient use of legal
counsel and to share and protect information.
SettlementProcedures
10.9..
Neither Party shall settle any Claim or Action that is the subject of an indemnity or
obligation to defend under this Agreementwithout thepriorwritten consent of theother Party,
which consent shall not be unreasonably withheld, conditioned or delayed. Withholding consent
to a settlement proposal shall not be deemed to be unreasonable ifa settlement proposal results in
an adverse impact to the Partywithholding consent; provided that if the Defending Party presents
a resolution of a whole Action, or of a clearly severable portion of any Action,under which
Defended Party has no adverse economic impact and Defended Party declines to approve the
settlement, then as to such Actions or portions of Actionsonly, the Defended Party thereafter
shall be required to defenditselfin such Action or portion of the Action at its sole costand the
liability of the Defending Party shall be capped at the proposed settlement amount and attorneys’
fees incurred by the Defended Party prior to the date of the settlement offer. Notwithstanding
anything to the contrary in this Agreement, aDefending Party shall have no obligation to
indemnify any Defended Party for any settlement reached without DefendingParty’s consent;
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provided, however, that in the event Defending Party fails to satisfy its defense obligations under
this Agreement, any Defended Party shallhave the right to settle any indemnified Claims and
Defending Party shall be bound by such settlement and obligated to pay all defense and
settlement costs associated therewith.
Insurance
11..
Required Insurance
11.1..
Without limiting the City’s rights to indemnification, Developer shall procure and
maintain, at its own cost and expense, and furnish or cause to be furnished to the City, evidence
of the following policies of insurance (complying with the requirements set forth below) naming
Developer as insured and, with respect to the general liability and environmental liability
insurance required pursuant to Section 11.1.1 and 11.1.4 only, the City as additional insured. All
insurance required below shall be kept in force with respect to each such componentof the
Property, the Projectand/or the Improvementsuntil issuance of the Certificate of Compliance
with respect thereto or for such longer period as is described below.
Liability Insurance
11.1.1.. Commencing upon the Effective Date, Developer
shall maintain or cause to be maintained commercial general liability insurance, to protect
against loss from liability imposed by law for damages on account of personal injury, including
death therefrom, suffered or alleged to be suffered by any Person or Persons whomsoever on or
about the Property, the Projectand/or the Improvementsand the business of Developer on the
Property, or in connection with the operation thereof, resulting directly or indirectly from any
acts or activities of Developer or anyone directly or indirectly employed or contracted with or
acting for Developer, or under its respective control or direction, and also to protect against loss
from liability imposed by law for damages to any property of any Person occurring on or about
the Property, the Projectand/or the Improvementsor related to the Project and the business of
Developer on the Property, or in connection with the operation thereof, caused directly or
indirectly by or from acts or activities of Developer or any Person acting for Developer,or under
its control or direction. Such insurance shall also provide for and protect the City against
incurring any legal cost in defending Claims for alleged loss. Such insurance shall be maintained
in full force and effect until issuance of the Certificate of Compliance and so long thereafter as
necessary to cover any claims of damages suffered by persons or property prior to issuance of the
Certificate of Compliance, resulting from any acts or omissions of Developer, Developer’s
employees, agents, contractors, suppliers, consultants or other related parties. The amount of
insurance required hereunder shall include comprehensive general liability and personal injury
with limits of at least Five Million Dollars ($5,000,000.00) and automobile liability with limits
of at least Two Million Dollars ($2,000,000.00) combined single limit per occurrence. The
insurance shall be issued by a company permitted by the Insurance Department of the Stateand
rated A-/VII or better (if an admitted carrier) or A-/X (if offered by a surplus line broker), by the
latest edition of Best’s Key Rating Guide. Such insurance may be provided by an umbrella
insurance policy otherwise meeting the requirements of this Section 11.
An Accord certificate evidencing the foregoing and providing the following endorsements signed
by the authorized representative of the underwriter and approved by the City shall be delivered
within seven (7) Business Days following the Effective Date and annually (upon request from
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the City) evidencing renewals of each policy until issuance of the Certificate of Compliance for
the Project. The endorsements shall provide as follows: (1) designate the City, its elected and
appointed officials, agents, representatives and employees as additional insureds on the
commercial general liability policies; (2) the commercial general liability insurance coverage
shall be primary, and not contribute with any insurance or self-insurance maintained by the City
and (3) a waiver of subrogation for the benefit of the City. The procuring of such insurance and
the delivery of policies, certificates or endorsements evidencing the same shall not be construed
as a limitation of Developer’s obligation to indemnify the City Indemnified Parties as set forth
herein.
Workers’ Compensation Insurance
11.1.2.. Commencing upon the Effective
Date, Developer shall obtain, and thereafter maintain or cause to be maintained, workers’
compensation insurance issued by a responsible carrier authorized under the laws of the Stateto
insure employers against liability for compensation under the workers’ compensation laws now
in force in California, or any laws hereafter enacted as an amendment or supplement thereto or in
lieu thereof. Such workers’ compensation insurance shall cover all Persons employed by
Developer in connection with the Project and shall cover liability within statutory limits for
compensation under any such act aforesaid, based upon death or bodily injury claims made by,
for or on behalf of any Person incurring or suffering injury or death in connection with the
Project or the operation thereof by Developer. Notwithstanding the foregoing, Developer may,
in compliance with the laws of the Stateand in lieu of maintaining such insurance, self-insure for
workers’ compensation in which event Developer shall deliver to the City evidence that such
self-insurance has been approved by the appropriate State authorities. Developer shall also
furnish (or cause to be furnished) to the City evidence satisfactory to the City that any contractor
with whom it has contracted for performance of work on the Property or otherwise pursuant to
this Agreement carries workers’ compensation insurance required by law. The insurance policy,
by endorsement signed by an authorized representative of the underwriter,shall contain a waiver
of subrogation. The insurance provided for under this Section 11.1.2 shall be issued by a
company rated B-/VIII or better or from the State Compensation Fund.
Builder’s Risk Insurance
11.1.3.. Commencing upon the commencement of
construction by Developer of any Improvements and continuing until such time as the City
delivers a Certificate of Compliance, Developer shall obtain, or shall cause its contractor to
obtain, and thereafter maintain a builder’s risk policy with respect to such improvements or
maintain comparable coverage through a property policy. Such insurance shall be maintained in
an amount not less than one hundred percent (100%) of the full insurable value of the
Improvements. The insurance provided for under this Section 11.1.3 shall be provided by
insurer(s) permitted to do business in the Stateand with a Best’s rating of B/NR or better.
Environmental Insurance
11.1.4.. From and after the Close of Escrow,
Developer shall obtain and shall thereafter maintain environmental and pollution legal liability
insurance coverage for the Property, including coverage for loss, remediation expense and legal
defense expenses, and naming the City as a named insured to address pollution risks at the
Property; provided that notwithstanding anything to the contrary set forth herein, the City
acknowledges and agrees that such insurance may contain exclusions from coverage relating to
known pre-existing conditions and/or conditions that are discovered during development on the
Development Parcels. Such policy shall comply with the following requirements:
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(a)The policy shall be written by the insurance company selected by
Developer and approved by the City, which approval shall not be unreasonably withheld, and
which insurer(s) shall have a Best’s rating of A-/VII or better;
(b)The policy shall provide Five Million Dollars ($5,000,000) in
coverage, subject to a maximum One Million Dollar ($1,000,000) deductible per claim, to
protect against Claims and loss from liability relating to known and unknown conditions on the
Property for a 10-year term; and
(c)The policy shall be paid for in full at the time of issuance and shall
be endorsed as non-cancelable by Developer without the written consent of the City in its sole
discretion to such cancellation and, to the extent available, shall contain a waiver of subrogation
for the benefit of the City. As such, Developer’s obligation to maintain environmental insurance
pursuant to this Section 11.1.4 shall survive the termination of this Agreement following the
Close of Escrow for the term required for such insurance policy pursuant to Section 11.1.4(b).
(d)Developer shall name the City as an additional insured with respect
to any additional environmental and pollution legal liability insurance coverage Developer
acquires forthe Property, the Developer Parcels or any portion thereof and to the extent such
policy is prepaid, shall not modify or terminate such policy following the termination of this
Agreement.
The provisions of this Section 11.1.4 shall survive the termination of this
Agreement.
General Insurance Requirements
11.2..
11.2.1.For all policies or certificates, the insurer endorsements (or a copy of the
policy binder, if applicable) shall specifically identify this Agreement and shall provide evidence
that either (a)Developerhas paid for its premium in full for any policy that is currently in place,
or (b) that said insurance shall not be cancelled except if the City is given at least thirty (30)
calendar days advance written notice of any cancellation or termination of insurance by the
insurer.
full insurable value
11.2.2.The term “” as used in this Section 11 shall mean the
cost determined by mutual agreement of the Parties (excluding the cost of excavation, foundation
and footings below the lowest floor and without deduction for depreciation) of providing similar
Improvements of equal size and providing the same habitability as the Improvements
immediately before such casualty or other loss, but using readily-available contemporary
components, including the cost of construction, architectural and engineering fees, and
inspection and supervision.
11.2.3.All insurance provided under this Section 11 shall be for the benefit of the
Parties. Developer agrees to timely pay all premiums for such insurance and, at its sole cost and
expense, to comply and secure compliance with all insurance requirements necessary for the
maintenance of such insurance. Developer agrees to submit certificates evidencing such
insurance to the City on an Accord form within seven (7) Business Days, following the Effective
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Date, or, with respect to coverage required by Section 11.1.4, the Close of Escrow. Upon request
by the City, within seven (7) calendar days, if practicable, after expiration of any such policy,
certificates evidencing renewal policies shall be submitted to the City, together with evidence of
payment of premiums.
11.2.4.If Developer fails or refuses to procure and maintain insurance as required
by this Agreement, the City shall have the right, at the City’s election, and upon ten (10) calendar
days’ prior notice to Developer, to procure and maintain such insurance. The premiums paid by
the City shall be treated as a loan, due from Developer, to be paid on the first calendar day of the
month following the date on which the premiums were paid. The City shall give prompt notice
of the payment of such premiums, stating the amounts paid and the name of the insured(s).
11.2.5.Since the insurance policies required by Section 11.1.4 will not be
effective until after the Close of Escrow, the evidence of insurance to be delivered by Developer
to the City at the Close of Escrow shall be limited to a binder evidencing that the insurance
required by Section 11.1.4 will become effective following the Close of Escrow.
Covenants and Restrictions
12..
Use Covenant
12.1..
Developer shall cause the Development Parcels to be developed(a) only for lawful
residential uses and such uses as are ancillary or incidental theretoand (b) as a High Quality
Residential Project.
Maintenance Covenant.
12.2.
12.2.1.Maintenance Standards.Developer, on behalf of itself and each
Successor Owner, hereby covenants and agrees, from and after the Close of Escrow to maintain
the Development Parcels,the Improvements and the Landscape Improvements thereon consistent
with the following requirements:
(a)Prior to commencement ofconstruction, Developer shall be
responsible, at its sole cost and expense, (i) to secure and maintain the Development Parcels in a
clean, safe and secure condition, in compliance with all applicable laws, (ii) to abate weeds and
other hazards and nuisances onthe Development Parcels, (iii) to erect and maintain barricades
and fencing, and provide security, in each case with respect to the Development Parcels and as
reasonably necessary to protect the public and any Improvements already constructed, and (iv) to
maintain (in compliance with all Environmental Laws) erosion control on the Development
Parcels.
(b)From the date of commencement and during the continuance of
construction of any Improvements on the Development Parcels, Developer shall maintain the
Development Parcels and the Improvements then under construction consistent with normal and
customary construction industry practice. From and after the initial installation of Landscaping
Improvements, Developer shall maintainall Landscaping Improvements then installed in good
conditionand consistent with the requirements of this Agreement, the Special Restrictions, the
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CC&Rs and the Landscape Maintenance Agreement, as applicable; provided that with respect to
Landscaping Improvements located on Common Areas, the obligation of Developer under this
Section shall terminate with respect thereto upon transfer of the Common Area associated
therewith to the Homeowners’ Association.
(c)From and after the issuance of a certificate of occupancy for any
Homes or other Improvements on the Development Parcels, and prior to the transfer thereof to an
End User, Developer shall maintain all Improvements on suchDevelopment Parcels and all
Landscape Improvements not then under construction in a clean, sanitary, orderly and attractive
condition, and in accordance with High Quality Residential Standards, subject to reasonable
wear and tear and toSection 12.2.2and in accordance with the requirements of the Special
Restrictions, the Landscape Maintenance Agreement and the CC&Rs. Developer shall be
required to meet the standard for the quality of maintenance of the Improvements on the
Development Parcels required by this Section regardless of whether or not a specific item of
maintenance is listed below, except that, in each case, and notwithstanding anything in this
Section to the contrary, Developer shall not have any maintenance obligation with respect to (x)
any Completed Improvements owned or controlled by (or on property owned or maintained by)
any Homebuyerorany Homeowners’Associationor (y) with respect to any Completed
Improvements owned by any utility, Governmental Authority, lighting or landscape district or,
except as set forth in the Landscape Maintenance Agreement, by the City. Representative items
of maintenance shall include: (i) maintenance, repair and replacement on a regular schedule,
consistent with High Quality Residential Standards, of all Common Areas, Common Area
Improvements,LandscapingImprovements,buildings, structures, improvements, Private Streets
and Sidewalksand all otherroads, drives, bike paths, alleyways, sidewalks, utilities, landscaping,
hardscaping and fountains;(ii) regular inspection for graffiti or damage or deterioration or
failure, and reasonably prompt (or, in the case of graffiti, within 48 hours) repainting or repair or
replacement of all surfaces, fencing, walls, equipment, etc., as necessary; (iii) emptying of trash
receptacles and removal of litter; (iv) regular sweeping of Private streetsand Sidewalks
throughout the Development Parcels; (v) fertilizing, irrigating, trimming and replacing
vegetation and other Landscaping Improvements as necessary; (vi) cleaning exterior windows on
a regular basis; (vii) painting the buildings on a regular program and prior to the deteriorationof
the painted surfaces; and (viii)conducting roof inspections on a regular basis and maintaining
roofs in a leak-free and weather-tight condition.
12.2.2.Casualty.In the event of casualty occurring with respect to portions of the
Property still owned by Developer, Developer shall, in its sole discretion, either (i) promptly
repair the Improvements and prior to commencement of such repair maintain the portions of the
Development Parcels subject to casualty in accordance with Section 12.2.1(b), or (ii) if
Developer determines in its sole discretion not to repair such Improvements, maintain the
portions of the Development Parcels subject to casualty in accordance with Section 12.2.1(a). In
each case, upon commencement of any construction with respect to the affected portions of the
Development Parcels and until completion thereof, Developer shall comply with the
requirements set forth in Section 12.2.1(b) and upon completion of the repair work, shall comply
with the requirements set forth in Section 12.2.1(c) Notwithstanding the foregoing, the portions
of the Development Parcels unaffected by any such casualty shall be maintained as otherwise
required by this Agreement and, including, without limitation, pursuant to Section 12.2.1(c), and
unless not economicallyfeasible due to cost or physical proximity as demonstrated to the
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reasonable satisfaction of the City, Developer shall provide landscaping or other barriers to
shield the portions of the Development Parcels remaining in use and adjacent public roadways
from those subject to casualty and from adjoining streets in order to maintain the portions of the
Development Parcels and the Improvements thereon unaffected by such casualty as required
pursuant to Section 12.2.1(c).The provisions of this Section shall survive the termination of this
Agreement.
City Rights to Maintain
12.2.3.. IfDeveloper fails to maintain the
Improvements orthe Development Parcels or any portion thereof in accordance with the
standard for the quality of maintenance set forth in this Section12and such failure continues
after the delivery of notice and the expiration of the cure period under Section 14.2.2, the City or
its designee shall have the right but not the obligation to enter the Property upon reasonable
notice to Developer, correctsuch failure, and hold Developer responsible for the cost thereof,
and such cost, until paid, shall constitute a lien on the applicable portion of the Property as and to
the extent described in Section 16.2.
Maintenance Responsibilities
12.2.4..Except as otherwise provided in this
Section,Developer’s maintenance responsibilities shall be vested in one entity for the entirety of
the Project and all of the Development Parcels; provided however that Developer’s obligations
under this Section 12.2 shall terminate with respect to any portion of the Development Parcels
transferred to an End User and such termination shall be effective automatically upon such
transfer. With respect to those portions of the Development Parcels not yet transferred to an End
User, Developer shall have the right (a) to assign its maintenance responsibilities under this
Agreement pursuant to Transfer to a Homeowners’ Association to be created through the
CC&Rs, upon which assignment Developer shall have no further liability under this Section
12.2,(b) to subcontract its maintenance responsibilities under this Agreement to such
Homeowners’ Association or a first class property management company provided that such
subcontracting shall not relieve Developer of any liability for its obligations under this Section
12.2, and (c) assign its maintenance obligations to a Builder Transfereewith respect to those
portions of the Property conveyed to Builder Transferee; provided, however that such
assignment shall not relieve Developer of its maintenance obligations under this Section 12.2.
Duration of Covenants
12.3..
The Special Restrictions shall provide with respect to each Lot and each lot comprising
Common Area that the covenants in Sections 12.1 and 12.2 shall remain in force and effect until
th
the earlier of (a) the twenty-fifth (25) anniversary of the Recording of the Special Restrictions
and (b) the Recordation of the CC&Rsagainst such Lot or Common Area lot, unless released at
an earlier date by City in writing.In addition, the covenant set forth in Section 12.2 shall apply
with respect to all portions of the Development Parcels owned by Developer during the term of
this Agreement.
Profit Participation Price.
12.4.
Developer covenants and agrees on behalf of itself and each Successor Owner to pay to
the City the Profit Participation Pricepursuant to the terms and conditions of the Profit
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Participation Agreement, which shall be in substantially the form and substance of the Profit
Participation Agreement attached to this Agreement as Attachment 14.
Obligation to Refrain from Discrimination
12.5..
Developer covenants and agrees for itself and each Successor Owner, that there shall be
no discrimination against or segregation of any person, or group of persons, on account of sex,
race, color, religion, ancestry, national origin, disability, medical condition, marital status, or
sexual orientation in the sale, lease, transfer, use, occupancy, tenure or enjoyment of the Property
or in development of the Project, nor shall Developer establish or permit any such practice or
practices of discrimination or segregation with reference to the selection, location, number, use
or occupancy of tenants, lessees, subtenants, sublessees or vendees of the Property or in
development of the Project.
Deed Restrictions/Covenants Running with the Land
12.6..
The Special Restrictions and the Quitclaim Deed shall be covenants running with the
land, shall be binding upon Developer, each Successor Owner and each and every Person
claiming by, through or under Developer or any Successor Owner for the benefit of the City and
the City Benefited Parcels.
Priority of DDA and Special Restrictions
12.7..
This Agreement, including the Lien, the Right of Purchase and the Right of Reversion
contained herein, the Memorandum of DDA and the Special Restrictions shall be superior in
priority to all Mortgages, provided, however, this Section 12.7 shall not apply to any Mortgages
obtained by Homebuyers.
Landscape Maintenance Agreement
12.8..
LandscapeArea
12.8.1.. As a condition to the Close of Escrow, Developer and
theCity shall enter into a landscape maintenance agreement in the form and substance of the
Landscape Maintenance Agreement attached as Attachment 22tothis Agreement (the
Landscape Maintenance Agreement
“”), which shall require that Developer install and
maintain LandscapingImprovements onthe Landscape Areadescribed therein, including
vegetation of a type and amount as may reasonably be required to maintain landscaping of the
Boundary Landscape Areaconsistent with High Quality Residential Standards.
CityRights to Maintain
12.8.2.. In the event Developer fails to maintain the
Landscape Areaor any portion thereof in accordance with the standard for the quality of
maintenance pursuant to Section 12.8.1, the City or its designee shall have the right but not the
obligation following a reasonable notice and cure period,to correct any violation, and hold
Developer responsible for the cost thereof, all as more particularly set forth in the Landscape
Maintenance Agreement.
Park and Access Easement
12.9..The Park shall beprivately owned but accessible to
the publicpursuant to the easement described below,except that the portion of the Park shownas
“private”onAttachment 13,comprising approximately .88 acres, shall not be accessible to the
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public but shall be utilizedfor Common Area Improvements accessible to Homebuyers and their
invitees.Developershall,pursuant to the Final Map,grant a perpetual easement to the City for
the benefit of the public providingpublic pedestrian and vehicular access as applicable in, on,
over and across the Private Streets and Sidewalks, the Greenbelt Park Areas and the portions of
thePark andPark Facilities to be made available to the public in the locations depicted on
Attachment 13.
CC&Rs and Homeowners’Association
13..
City Approval of CC&Rs
13.1..
As a condition precedent to the Close of Escrow, Developer shall submit to the City for
City Manager’s approval, a first draft of a set of covenants, conditions and restrictions, as well as
design guidelines for development of the Improvements to be constructed as part of the Project,
together with other requirements included in the conditions of approval for the Tentative Tract
CC&Rs
Map for the Project as approved by the City (the “”). In addition,not less than thirty
(30)calendar days prior to submission of the CC&Rs to theBRE, Developer shall submit to the
City, for the City Manager’s Approval, the draft of CC&Rs it proposes to submit to BRE,
together with a “redline” comparison of that version to the draft originally reviewed by the City.
Thereafter, prior to Recording of the CC&Rs, Developer shall submit to the City, for the City
Manager’s approval, the version of the CC&Rs approved by BRE togetherwith a “redline”
comparison of that version to the draft submitted to BREand City shall review and approve such
final version, within two (2) Business Days from City’s receipt of such final version.The City’s
review and approval of the CC&Rs with respect to compliance with the conditions of approval
for the Entitlements and the DA shall be made in the City’s Governmental Capacity. The City’s
right of review with respect to all other aspects of the CC&Rs shall be made in the City’s
reasonable discretion; provided, that itshall be reasonable for the City to disapprove the terms
and conditions of the CC&Rs if, among other things, such terms and conditions conflict with any
requirement of this Agreement, the DAor the Special Restrictions, relieve the Homebuyers or
the HOA of any obligations imposed pursuant to this Agreement, the DAor the Special
Restrictions or impose any obligations upon the City; provided, however that City may not
disapprove any of the terms and conditions of the CC&Rs required by the BRE. Among other
things, the CC&Rs shall establish (a) creation of only one Homeowners’Association for the
Project (except as provided in Section 13.2) which entity shall be responsible for maintenance of
the Development Parcels and the Common Areas; (b) Common Area access easements;(c) a
mechanism for sharing costs for maintenance of the Common Areas and Common Area
Improvements;(d) a maintenance covenant for the benefit of the City as set forth in Section 12.2
or as otherwise agreed by the City in its sole discretion;(e)regulations governing the use,
maintenance and operation of the Lots and Homes by the Owners thereof and of the Common
AreasandCommon Area Improvementsby the Homeowners’Association and (f) all other
requirements included in the conditions of approval for the Tentative Tract Map for the Project.
The CC&Rs shall be Recorded prior to the issuance of the first Certificate of Occupancy for a
completed Home within the Property.
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Homeowners’Association and Sub-Association.
13.2.
The Developer shall form a Homeowners’Association as provided in Section 13.1,
provided however, Developer may, at its option, form a sub-association in accordance with the
requirements of the CC&Rs and the applicable provisions of California law composed of owners
of Homes within the Development Parcels, for the purpose of administering and enforcing
covenants, conditions, restrictions, reservations, easements, equitable servitudes, liens and
charges, owning and maintaining all Common Area Improvements, if any, collecting and
disbursing assessments and charges, and performing such other acts as shall generally benefit the
Development Parcels, provided that none of the Homebuyers within the Project are excluded
from any Common Areas or from use of any Common Area Improvementsand the public is
provided access over all Private StreetsandSidewalks,the Greenbelt Park Areas, the Parkand
Park Facilitiesas required by Section 12.9.
Potential Defaults and Material Defaults
14..
Potential Defaults
14.1..
Except as otherwise provided in this Agreement, in the event either Party (the
Defaulting Party
“”) fails to perform, or delays in the performance of, any obligation, in whole
or in part, required to be performed by the Defaulting Party as provided in this Agreement (a
Potential DefaultInjured Party
“”), the other Party (the “”) may give written notice of such
Default Notice
Potential Default to the Defaulting Party (the “”), which Default Notice shall state
the particulars of the Potential Default.
Material Defaults
14.2..
Monetary Defaults
14.2.1.. Notwithstanding any other provision of this
Agreement, if a Party fails to paythe other Party any sum required to be paid pursuant to this
Agreement, and the Injured Party gives the Defaulting Party a Default Notice of such
nonpayment, such nonpayment shall be a Potential Default. The Defaulting Party shall have a
period of fifteen (15) calendar days after the date the Default Notice is received, or deemed to
have been received, within which to cure the Potential Default by making the required payment;
the period to cure such Potential Default shall not be extended by Force MajeureDelays. In the
event a Potential Default for nonpayment is not cured within said fifteen (15) calendar day
Material Default
period, the Potential Default shall become a “” that shall be deemed to have
occurred upon the expiration of the cure period.
Non-Monetary Defaults
14.2.2..With respect to non-monetary defaults under
Material
this Agreement, except as set forth in Section 16.7, a Potential Default shall become a “
Default
” in the event the Potential Default is not cured, at the Defaulting Party’s expense,
(a)within thirty (30) calendar days after the date the Default Notice is received, or deemed to
have been received by the Defaulting Party, (b) if such cure cannot be reasonably accomplished
within such thirty (30) calendar day period, within ninety (90) calendar days after the date the
Default Notice is received, or deemed to have been received by the Defaulting Party, but only if
the Defaulting Party has commenced such cure within such thirty (30) calendar day period and
diligently pursues such cure to completion, or (c)within such longer period of time as may be
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expressly provided in this Agreement or as mutually agreed to in writing between the Parties
with respect to the Potential Default. Following written notice and failure to cure within the time
periods set forth above, each Potential Default shall become a Material Default that shall be
deemed to have occurred upon the expiration of the applicable cure period. Notwithstanding
anything in the foregoing to the contrary, the Defaulting Party may cure a Material Default at
any time prior to the date the Injured Party exercises is remedy for the Material Default.
Transfer Defaults
14.2.3.. Notwithstanding the foregoing, any Transfer or any
Transfer of Control in violation of the provisions of Section 2 shall be null and void and shall in
all events be a Material Default under this Agreement as of the date of the Transfer or Transfer
of Control by the violating party, without notice or cure period and shall not be subject to
extension for Force Majeure Delay.
Interest
14.2.4.. If a monetary Material Default occurs under this Agreement,
then in addition to any other remedies conferred upon the Injured Party pursuant to this
Agreement, the Defaulting Party shall pay to the Injured Party, in addition to all principal
amounts due, interest on such principal amounts at the Default Rate, for the period from the date
such payment or part thereof was due until the date the same is paid.
No Waiver
14.2.5.. Failure or delay by an Injured Party to deliver a Default
Notice shall not constitute a waiver of any Default, nor shall it change the time of Default.
Except as otherwise expressly provided in this Agreement, any failures or delays by either Party
in asserting any of its rights and remedies as to any Default shall not operate as awaiver of any
Default or of any such rights or remedies. Delays by either Party in asserting any of its rights
and remedies shall not deprive either 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.
Builder Transferor Obligations and Remedies
14.2.6.. Until issuance of a
Certificate of Compliance, the following shall apply with respect to atransfer by Developer of a
portion of the Property to a Builder Transferee pursuant to Section 2.2.3(b) (the Developer
Builder
owning the Property prior to a transfer to a Builder Transferee is referred to herein as “
Transferor
” and the portion of the Property and the improvements thereon so transferred, the
Transferred Property
“”):
(a)Builder Transferor shall have the right, jointly with Builder
Transferee,to cure any obligations under this Agreement or the Other Agreements assigned by
Builder Transferor to Builder Transferee. Builder Transferor agrees that the time period for
Completion of construction of Vertical Improvements and On-Lot Improvementsby Builder
Transfereewith respect to the Transferred Propertyas contained in the sale agreement between
Builder Transferor and Builder Transferee shall be reduced by six (6)months from the time
period otherwise set forth in this Agreement for performance by Developer. Any Potential
Default of Builder Transferee shall not become a Material Default of Builder Transferee or
Builder Transferorif eithercures such Potential Default during the time period set forth in
Section 14.2.1 or 14.2.2, as applicable.Builder Transferor shall have the right, at any time prior
to the earlier of exercise of the Right of Purchase and/or Right of Reversion, or the termination
of this Agreement, to cure or remedy a Default, to effect any insurance, to pay any amounts due
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to the City, to make any repairs or improvements, to do any other act or thing required of
Developer under this Agreement and to do any act or thing which may be necessary and proper
to be done in the performance and observance of this Agreement to prevent termination of this
Agreement. Any of the foregoing done by such Builder Transferor shall be as effective to cure
such Default or to prevent a termination of this Agreementor the exercise by the City of the
Right of Purchase or the Right of Reversion as the same would have been if done by Builder
Transferee.
(b)Provided that a Repurchase Default or Reversion Action Trigger
applicable to Builder Transferor with respect to portions of the Developer Parcels then owed by
it shall not have occurred and then be continuing, if any Potential Default by Builder Transferee
shall occur, then notwithstanding any other provision of this Agreement to the contrary, City
shall provide Builder Transferor with concurrent notice of a Potential Default by Builder
Notice to Builder Transferor
Transferee with respect to the Transferred Property (a “”). Failure
of City to deliver such notice shall not affect in any way the validity of the notice of Potential
Default as it relates to the Builder Transferee, but in any subsequent proceedings arising from the
notice of default with respect to which there was a failure to provide concurrent notice to Builder
Transferor, the interest of the Builder Transferor shall not be affected in any way until such time
as it has received proper notice and all cure periods with respect thereto have expired, and
provided, further, the giving of any notice of default or the failure to deliver a copy to any
Builder Transferor shall in no event create any liability on the part of the Person declaring a
Default. The City shall not be entitled to terminate this Agreement or to acquire the Transferred
Property or any portion thereof or to exercise any remedy with respect to such Material Default
under this Agreement (provided, however, that nothing set forth in this Agreement shall restrict
or limit the right of theCity to declare a Material Default or to exercise its Governmental
Capacity remedies, including with respect to the Entitlements or any bond issues in favor of the
City)unless Builder Transferor shall fail to do any of the following within the time period set
forth below:
(i)cure thePotentialDefault within thirty (30) calendar days
following the Notice to Builder Transferor if thesame consists of the
nonperformance by Developer of any covenant or condition of this Agreement
requiring the payment of money by Developer to the City;
(ii)if thePotentialDefault is not of the type described in clause
14.2.6(b)(i),then(x) cure suchPotentialDefault, if the same is capable of being
cured within ninety (90)calendar days from the delivery of the Notice to Builder
Transferor,(y)commence within ninety (90) calendar days from the delivery of
the Notice to Builder Transferor andthereafter diligently pursue such cure to
completionwithin a period not to exceed six (6) months,or (z) if the Potential
Default is of a nature that it cannot be cured by Builder Transferor without
possession of the Transferred Property,commence withinninety (90) calendar
days steps andproceedings to regain title to the Transferred Property;provided
that with respect to this clause (z), any such action shall be completed within a
maximum of six (6) months following the commencement of such proceeding.
Any Default which does not involve a covenant or condition of this Agreement
requiring the payment of money by Developer to the City shall be deemed cured
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if any Builder Transferor shall regain fee title to the Transferred Property in
accordance with the foregoing requirements and shall, upon acquiring fee title to
all or any portion of the Transferred Property, thereafter undertake its obligations
with respect such portion of the Transferred Property pursuant to this Agreement.
(c)If Builder Transferorisprohibited from commencing or
prosecuting any action to regain fee title by any process or injunction issued by any court or by
reason of any action by any court having jurisdiction of any bankruptcy or insolvency proceeding
involvingBuilder Transferee(other than any such process, injunction or court action occurring in
response to any negligence or misfeasance of Builder Transferor), then: (i) the times specified in
Section 14.2.6(b)(ii) for commencing or prosecuting an action to regain title shall be extended
with respect to Builder Transferor only for the period of the prohibition(and such extension shall
not be applicable to Builder Transferee); provided that Builder Transferor shall have fully cured
any Default required by Section 14.2.6(b)(i) and each Default under Section 14.2.6(b)(ii) which
is capable of cure without possession and shall continue to perform and/or cure all such
obligations as and when the same fall dueand (ii)the City shall have the right to exercise any
and all rights availableto it pursuant to this Agreement, provided that so long as Builder
Transferor is diligently proceeding to cure as required by Section 14.2.6(b) and diligently
proceeding to exercise its rights pursuant to this clause (c), Builder Transferor shall not be in
Default under this Agreement due to Default by Builder Transfereeand City shall have no right
to pursue any remedy against Builder Transferoror any interest of Builder Transferorin the
Property based upon such Default by Builder Transferee.
(d)So long asBuilder Transferor has complied with the Takedown
Restrictions, failure of Builder Transferor to cure the Default of Builder Transferee within the
time periods set forth in Section 14.2.6(b)(i) or (ii), as applicable, shall not be a Default under
this Agreement by Builder Transferor.If Builder Transferor shall have violated the Takedown
Restrictions, then subject to the time periods set forth for cure by Builder Transferor in Sections
14.2.6(b) and (c), a Material Default of Builder Transferee shall be aMaterial Default of Builder
Transferor as well, and the City, in addition to any rights it may have with respect to Builder
Transferee,shall have the right, at its option, and to the extent such remedy is available pursuant
to Section 16.3 or 16.4, to exercise the Right of Purchase set forth in Section 16.3or to exercise
its Right of Reversion with respect to Property and Improvements owned by Builder Transferor
to exercise any other rights or remedies provided to City by this Agreementwith respect to
Builder Transferor.
(e)Builder Transferor shall provide notice to the City of any default
by Builder Transferee under theagreements between Builder Transferor and Builder Transferee,
concurrently withitsprovision of notice of such default toBuilder Transferee.
(f)In the event that Builder Transferor intends to cure the Default of
Builder Transferee pursuant to Section 14.2.6(b)or (c), then Builder Transferor shall provide
written notice to the City within 15 calendar days after its receipt of the Notice to Builder
Transferor specifying its proposed actions, and shall thereafter provide written reports to the City
on a monthly basis setting forth its actions to date and proposed actions to cure the Default of
Builder Transferee.
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Due Diligence Information; Products
14.3..
Destruction of Due Diligence Information
14.3.1.. Within five (5) Business
Days following a termination of this Agreement prior to the Close of Escrow, Developer shall
use commercially reasonable efforts to return to the City all written Due Diligence Information
in Developer’s possession. Developer’s obligation to return Due Diligence Information to the
City is without representation or warranty of any kind by Developer.
Surrender of Transferable Products
14.3.2.. In connection with the proposed
Project, Developer shall be preparing or causing to be prepared architectural and other products,
surveys, plans, reports, tests, studies and investigations with respect to the Property and the
Products
proposed Project (collectively, “”). All Products shall be prepared at Developer’s sole
cost and expense. If this Agreement is terminated for any reason other than a Material Default
by the City prior to or following the Close of Escrow, then, with respect to all Products other
than financial or economic estimates, projections and evaluations; studies and information
related to potential tenants, lenders and investors; any confidential or proprietary information of
Developer or its equity partner(s) or attorney-client or other privilege (the Products not subject to
Transferable Products
such exclusions are collectively the “”), the City may request that
Developer, for consideration to be mutually agreed, transfer Developer’s rights to any or all of
the Transferable Products identified by the City, but in no event shall the cost to the City exceed
Five Thousand Dollars ($5,000.00). Upon such request, Developer shall deliver to the City
copies of all Transferable Products requested by the City together with a bill of sale therefor,
provided that such transfer is made AS-IS andDevelopermakes no representation, warrantee or
guarantee regarding the completeness or accuracy of the Transferable Products, and Developer
does not covenant to convey the copyright or other ownership rights of third parties thereto.
Such Transferable Products shall thereupon be free of all claims or interests of Developer or any
liens or encumbrances. Upon the City’s acquiring Developer’s rights to any or all of the
Transferable Products, the City shall be permitted to use, grant, license or otherwisedispose of
such Transferable Products to any person or entity for development of the Project or any other
purpose; provided, however, that Developer shall have no liability whatsoever to the City or any
transferee in connection with the use of the Transferable Products. Notwithstanding anything to
the contrary herein, Developershall only be obligated to transfer any Transferable Products to
the extent that Developerowns the rights to the same pursuant to its contract with the preparer
thereof, provided that Developershall use commercially reasonable efforts to secure ownership
of Transferable Products pursuant to such contracts.
Survival
14.3.3.. The provisions of this Section 14.3 shall survive the
termination of this Agreement in its entirety or as to any portion of the Property except that it
shall terminate upon the issuance of the Certificate of Compliance.
Nonoccurrence of a Condition at Close of Escrow
15..
Failure of a Condition Absent a Default
15.1..
15.1.1.In the event the Close of Escrow is extended for any of thereasons set
forth in this Section 15.1 not caused by a Default by either Party, either Party shall have the right
to terminate this Agreement as hereinafter provided:
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(a)In the event a final decision in any litigation brought by a third
party or approval of a referendum or initiative results in the inability of the City to convey all or
any portion of the Property to Developer, or results in the inability of Developer to perform its
material obligations hereunder despite Developer’s commercially reasonable efforts to do so,
either Party shall have the right, upon thirty (30) calendar days’ prior written notice to the other
Party and the Escrow Holder, to terminate this Agreement.
(b)In the event litigation, referendum, or initiative brought by a third
party remains pending on the Outside Closing Date and (i) such ongoing challenge prevents the
City from conveying all or any portion of the Property to Developer, or (ii) such ongoing
challenge is the cause of Developer’s inability to perform its material obligationshereunder
despite Developer’s commercially reasonable efforts to do so, either Party shall have the right,
upon thirty (30) calendar days’ written notice to the other Party and the Escrow Holder, to
terminate this Agreement.
(c)In the event that the circumstances creating the right of termination
in Sections 15.1.1(a) or (b) havebeen cured during such thirty (30) calendar day period, the right
to terminate shall likewise be extinguished.
15.1.2.If the Close of Escrow does not occur on or before 5:00 p.m., Pacific
Time, on the Outside Closing Date, because of the failure to occur of a Closing Condition for
reasons other than a Default by either Party, then the Party for whose benefit the applicable
Closing Condition was intended may, by delivery of written notice to the other Party and to the
Escrow Holder, terminate this Agreement. In the event either Developer or the City is in Default
as of the Closing Date, the Party in Default shall not have the right to terminate the Agreement
pursuant to this Section 15.1 until and unless the Default is cured. Upon any termination of this
Agreement prior to the Close of Escrow (except for a termination pursuant to Section 15.2 or
Section 15.3), each Party shall pay one-half (1/2) of Escrow Holder’s normal cancellation
charges,and the Escrow Holder shall disburse the Purchase Price Deposit to Developer. The
termination of this Agreement pursuant to this Section 15.1 shall constitute a waiver of any rights
or Claims either Party may have against the other or against the Propertyor the Improvements,
or any portion thereof, but shall not terminate or release any liability or obligations of either
Party to comply with any obligations under this Agreement which are expressly stated to survive
a termination of this Agreement prior tothe Close of Escrow. In the event of a termination as
provided in this Section 15.1, under no circumstances shall Developer have any right or claim to,
or against, the Project or Property or any portion thereof.
15.1.3.For purposes of clarity, the failure of a Closing Condition for the benefit
of either Party to be satisfied at or prior to the Close of Escrow shall not, on its own, constitute a
Default by either Party hereunto absent a Default under a separate covenant, obligation,
representation or warranty setforth in this Agreement or any Other Agreement.
Material Default of Developer Results in Failure of Close of Escrow
15.2..
15.2.1.IF THE CLOSE OF ESCROW DOES NOT TAKE PLACE ON OR
BEFORE 5:00 P.M., PACIFIC TIME, ON OR BEFORE THE CLOSING DATE SOLELY AS
A RESULT OF A DEFAULT BY DEVELOPER (INCLUDING FAILURE TO DELIVER
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SUFFICIENT FUNDS TO CAUSE THE CLOSE OF ESCROW TO OCCUR IN A TIMELY
MANNER, IN ACCORDANCE WITH THE PROVISIONS OF SECTION7), THE PARTIES
ACKNOWLEDGE AND AGREE BY INITIALING THIS AGREEMENT IN THE SPACE
PROVIDEDBELOW THAT:
(a)THE PURCHASE PRICE DEPOSIT PROVIDED FOR IN
SECTION 4.2.1 OF THIS AGREEMENT BEARS A REASONABLE RELATIONSHIP TO
THE DAMAGES WHICH THE PARTIES ESTIMATE MAY BE SUFFERED BY THE CITY
AS THE RESULT OF THE DEVELOPER’S DEFAULT UNDER THIS AGREEMENT THAT
RESULTS IN THE FAILURE OF THE CLOSE OF ESCROW, WHICH DAMAGES WOULD
BE IMPRACTICAL OR EXTREMELY DIFFICULT TO QUANTIFY, THAT SUCH DEPOSIT
CONSTITUTES A REASONABLE ESTIMATE OF THE CITY’S DAMAGES IN SUCH
EVENT, AND THAT THE REMEDY PROVIDED FOR IN THIS AGREEMENT IS NOT A
PENALTY OR FORFEITURE AND IS A REASONABLE LIMITATION ON DEVELOPER’S
POTENTIAL LIABILITY AS A RESULT OF SUCH DEFAULT; AND
(b)DEVELOPER SHALL PAY THE FULL AMOUNT OF
ESCROW HOLDER’S CHARGES AS A RESULT OF SUCH DEFAULT AND
TERMINATION.
15.2.2.DEVELOPER SHALLCOMPLY WITH THE REQUIREMENTS OF
SECTION 14.3 AND SHALL INDEMNIFY THE CITY AS PROVIDED IN SECTION 5.5.
15.2.3.IF THE CLOSE OF ESCROW DOES NOT TAKE PLACE ON OR
BEFORE 5:00 P.M., PACIFIC TIME ON OR BEFORE THE CLOSING DATE SOLELY AS A
RESULT OF A DEFAULT BY DEVELOPER (INCLUDING FAILURE TO DELIVER
SUFFICIENT FUNDS TO CAUSE THE CLOSE OF ESCROW TO OCCUR IN A TIMELY
MANNER, IN ACCORDANCE WITH THE PROVISIONS OF SECTION 7), (A) ESCROW
HOLDER SHALL DISBURSE THE ENTIRETY OF THE PURCHASE PRICE DEPOSIT
AND ALL ACCRUED INTERESTTHEREON TO THE CITY, AS LIQUIDATED
DAMAGES, WHICH DAMAGES SHALL BE THE CITY’S SOLE AND EXCLUSIVE
REMEDY HEREUNDER FOR SUCH DEFAULT, EXCEPT FOR THE CITY’S RIGHTS AND
REMEDIES FOR A SEPARATE BREACH, IF ANY, OF THE CONFIDENTIALITY AND/OR
INDEMNIFICATION PROVISIONS SET FORTH IN SECTIONS 5.5 AND 17.24 OF THIS
AGREEMENT AND/OR THE PROVISIONS OF SECTION 14.3, AND (B) THE CITY
SHALL HAVE THE RIGHT TO TERMINATE THIS AGREEMENT AND THE ESCROW BY
DELIVERING WRITTEN NOTICE TO THE DEVELOPER AND TO ESCROW HOLDER
AND THE CITY SHALL BE RELEASED FROM ITS OBLIGATION HEREUNDER TO
SELL THE PROPERTY TO DEVELOPER.
___________________ ________________
Initials of CityInitials of Developer
Failure to Close; Default of City
15.3..
15.3.1.If the Close of Escrow does not occur on or before 5:00 p.m., Pacific
Time, on or before the Closing Date, solely as a result of a Default by the City in the
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performance of its obligations under this Agreement, then, so long as Developer is not in Default
and subject to the requirements of Section 15.3.2, Developer shall have the right, by providing
notice to the City, within twenty (20) Business Days after the Closing Date, of its election to do
so, either: (a) to purchase the Development Parcels pursuant to this Agreement notwithstanding
such Default by the City, whereupon such Default shall be deemed waived as against the City; or
(b) to terminate this Agreement and cancel the Escrow, in which case the provisions of Section
15.3.3 shall apply. In the event Developer fails to deliver such notice within such 20-day period,
Developer shall be deemed to have elected to terminate this Agreement and cancel the Escrow.
Notwithstanding the foregoing, in the event the City fails to deliver any of the materials
described in Section 7.2.1(a) orotherwise fails to proceed with the Close of Escrow in breach of
this Agreement within five (5) Business Days after Developer has delivered into Escrow all of its
required deliveries pursuant to Section 7.2.2(b) (other than the Developer Closing Payment),and
provided that all City Closing Conditions have been waived by the City in writing or satisfied
(except with respect to any City Closing Condition which is not satisfied as a result of a Default
by the City), Developer shall have the right to bring an action in equity or otherwise against the
City or subsequent owners, lessors or sublessors of the Property for specific performance of
Section 7.
15.3.2.In the event the City receives timely notice of Developer’s election to
purchase the Property pursuant to Section 15.3.1, notwithstanding the Default by the City,
Developer shall deliver the Developer Closing Payment into Escrow no later than ten (10)
Business Days after the City’s receipt of said notice and, upon satisfaction of the other
Conditions to Close of Escrow for the benefit of the City, the Close of Escrow shall occur on that
date which is eleven (11) Business Days after the City’s receipt of such notice, Developer shall
be deemed to have waived the Default as of the Close of Escrow.
15.3.3.In the event the City receives timely notice of Developer’s election to
terminate this Agreement pursuant to Section 15.3.1(b) or Developer is deemed to have elected
to terminate this Agreement pursuant to Section 15.3.1, the City shall pay the full amount of
Escrow Holder’s charges and Developer (a)shall be entitled to a full refund of its Purchase Price
Deposit, which refund of its Purchase Price Deposit shall be Developer’s sole and exclusive
remedy hereunder for the failure of the Close of Escrow and (b)shallnot be entitled to pursue an
action against the City for damages as a result of the Default by the City.
15.3.4.In the event Developer has elected to purchase the Property but fails to
deliver the applicable Developer Closing Payment into Escrow and to satisfy the other Closing
Conditions for the benefit of the City no later than ten (10) Business Days after the City’s receipt
of said notice, then the City shall have the right to terminate this Agreement by providing written
notice of its election to terminate to Developer, such termination to be in accordance with the
provisions of Section15.3.3.
15.3.5.The termination of this Agreement pursuant to this Section 15.3 shall not
terminate or release any liability or obligations of Developer to indemnify the City as provided in
Section5.5 or to comply with Section 14.3. In the event of a termination as provided in Section
15.3.3, under no circumstances shall Developer have any right or claim to, or against, the
Property or any portion thereof. The termination of this Agreement pursuant to this Section 15.3
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shall constitute a waiver of any and all rights and Claims either Party may have against the other,
except as expressly provided above.
Remedies for Defaults After the Close of Escrow
16..
General Remedies
16.1..
In the event Developer is in Material Default following the Close of Escrow, in addition
to whatever other rights the City may have in law or at equity, or as otherwise provided in this
Agreement, the City may do any one or more of the following with respect to the Development
Parcels:
(a)The City may record a lien against the Property in accordance with
Section 16.2.
(b)Subject to Section 17.5.1, the City may sue for damages it may
have incurred.
(c)The City may seek to specifically enforce the obligations of
Developer.
(d)The City may terminate this Agreement with respect to all, or any
portion of the Property.
Lien Rights
16.2..
Developer, on behalf of itself, each Successor Owner and each and every Person claiming
by, through or under Developer or any Successor Owner for the benefit of the Cityand its
successors and assigns hereby agrees that the delinquent amount of any payments due hereunder,
including any liquidated damages under this Agreement, together with any late charges or
interest due on any such delinquent payment, reasonable attorneys’ fees, experts’ fees and
consultants’ fees and collection costs related to such delinquent payment shall, to the greatest
extent permitted by applicable law, be a lien and charge upon the Property and shall be a lien
upon the Propertyin favor of the City effective upon Recordation of the Memorandum of DDA
City Lien
(the “”), which lien and charge shall be paramount to the lien and charge of any
Mortgage upon the Property. Upon conveyance of any portion of the Development Parcels to an
End User, the CityLien shall automatically terminate as to such conveyed portions, provided
however, that the termination of such City Lien shall not terminate the obligations of Developer
to City with respect to amounts due and secured by such lien, which shall remain an ongoing
obligation of Developer.
Right of Purchase
16.3..
Following the Close of Escrowand prior to the issuance of a Certificate of Compliance,
Right
in the event of a Repurchase Default (as definedbelow),the City shall have the right (the “
of Purchase
”), from time to time, at any time, to purchase all or a portion of the Development
Parcels (excluding those Lots for which Developer has been issued a building permit prior to the
date of the City’s election to purchase such land which has not expired as ofthe date of the
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City’s exercise of the Right of Purchase), the Improvements thereon and all applicable
Entitlements and other development rights, consents, authorizations, variances, waivers, licenses,
permits, certificates and approvals from any governmental or quasi-governmental authority, and
Repurchased Property
all other appurtenant rights applicable thereto (the “”).
Repurchase Default
16.3.1.. Subject to Section 14.2.6and, with respect to
clauses (a) through (e) below subject to extension for Force Majeure Delay, the City shall have
the right to acquire the Repurchased Property for the Repurchase Price in accordance with this
Repurchase
Section 16.3and upon the occurrence of any one of the following(each, a “
Default
”):
(a)Developer fails to comply with theInventory Commitment and
such becomes a Material Default in accordance with the notice and cure provisions of Section
14.2;
(b)Developer fails to comply with the Schedule of Performance and
such becomes a Material Default in accordance with the notice and cure provisions of Section
14.2;
(c)Developer constructs Improvements that are not in substantial
conformity with the Approved Plans and the requirements of Sections8.1.4, 8.9and such
becomes a Material Default in accordance with the notice and cure provisions of Section 14.2;
(d)For a period of one hundred eighty (180) consecutive calendar
days,Developer is in Material Default of the maintenance obligations set forth in Section 12.2
(including as set forth in the Special Restrictions, CC&Rs or LandscapeMaintenance
Agreement), in accordance with the notice and cure provisions of Section 14.2;
(e)Developercommits waste on the Propertyand such failure
becomes a Material Default in accordance with the notice and cure provisions of Section 14.2;
(f)The occurrence of a Developer Insolvency Event;
(g)Developer fails to payprior to delinquency any property taxesor
assessments,including AD/CFD assessments,required Project Fair Share Contribution
payments, or to pay City any other sums due hereunderand such becomes a Material Default in
accordance with the notice and cure provisions of Section 14.2;
(h)The occurrence of a CFD Default which has become a Material
Default in accordance with the notice and cure provisions of Section 14.2.2and the failure of
Developer to paythe CFD Liquidated Damageswhen due;or
(i)A Material Default arises because of a voluntary or involuntary
Transfer or Transfer of Control.
Exercise of Right of Purchase
16.3.2.. The City may exercise its Right of
Purchase by delivering written notice to Developer stating that the City is exercising its Right of
Purchase and specifying the Reacquired Property; provided that such notice is delivered at least
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ninety (90) calendar days prior to the date on which the City requires Developer to convey the
Property to theCity pursuant to the Right of Purchase and otherwise in accordance with this
Section16.3. The Right of Purchase shall be a lien and encumbrance on the Property that shall
be paramount to the lien and charge of any Mortgage upon the Property. The Repurchased
Property shall be delivered to the City at close of escrow free and clear of all liens and
Mortgages and subject only to (x) the Permitted Exceptions at the time of the applicable original
Close of Escrow for such portion of the Propertyand (y) all other matters created in connection
with the Entitlements and the development of the Project pursuant to this Agreement.
Access and Inspection
16.3.3.. The provisions of Section 16.5shall apply with
respect to the Repurchased Property.
Process
16.3.4.. If the City is entitled to and elects to repurchase the Repurchased
Property, the Parties shall: (a) within five (5) Business Days after the date of the City’s notice of
election to exercise the Right of Purchase, open an escrow with an escrow agent designated by
the City for the purchase and sale, and shall execute an escrow agreement that shall provide that
Developer shall pay all costs of the escrow and shall include such usual and ordinary terms as are
reasonably required by the escrow agent and by the transaction; (b) no later than five (5)
Business Days after the opening of escrow, Developer shall place into the escrow appropriate
quitclaim deeds and bill of sale conveying fee title to the Repurchased Property; and (c) no later
than eighty-five (85) calendar days after the opening of the escrow, the City shall deposit into the
escrow and amount equal to (i) the Repurchase Price minus(ii) the Lien Release Amounts, if
any,minus(iii)any amounts otherwise owing to the City by Developer and/or any Successor
Owner, including any City Liensarising pursuant to this Agreement with respect to the
Repurchase Property and minus(iv)the actual costs incurred by the City to acquire
environmental and pollution legal liability insurance coverage for theReacquired Property,
including coverage for loss, remediation expense and legal defense expenses.The escrow shall
close, and title to the Repurchased Property shall be conveyed to the City, no later than five (5)
Business Days after the City has deposited into escrow the Repurchase Price, but in no event
prior to the City’s delivery of the City Repair Acknowledgement with respect to anyrepairs to
the Improvements made pursuant to Section16.5.Concurrently with the close of escrow,
Developer shall comply with its obligations under Section 14.3 only with respect to the
Repurchased Property. Nothing herein shall restrict the right of the City to terminate its exercise
of the Repurchase Right at any time prior to the close of escrowandsuch termination shall not
be a default bythe City. At the close of escrow, real property taxes and assessments with respect
to the Repurchased Property shall be prorated between Developer and City as of the date of the
close of escrow. All prorations shall be based upon a 365-day year and actual days elapsed.All
closing costs, including the cost of an ALTA policy of title insurance in favor of the City with
respect to the Repurchased Property shall be borne by Developer and deducted from the
Repurchase Price.
Cooperation and Grant of Easements
16.3.5.. Concurrently with close of
escrow for the Repurchased Property, the Parties shall each reserve and/or grant to the other such
roadway, utility, access and other easement rights as may be required by the other Party and its
successors in interest to develop the Property as a unified development and as contemplated by
the Entitlements, the CC&Rs, this Agreement and the Other Agreements.
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Termination of Right of Purchase
16.3.6.. In the event that prior to delivery by
the City of written notice to Developer of its exercise of the Right of Purchase pursuant to
Section 16.3.2, Developer or any Person on behalf of Developer either (a)cures the Repurchase
Defaultwhich is the basis for the City’s exercise of its Right of Purchase, but excluding any
Transfer or Transfer of Control in violation of this Agreement, or (b) Completes the
Improvementsupon the Property that is subject to theRight of Purchase, such Right of Purchase
shall cease and terminate with respect to such Material Default only. In the event the Cityhas
declared a Repurchase Default, Developer shall not have the right to apply for building permits
for Vertical Improvements in a manner that affects or thwarts the ability of the City to exercise
its Right of Purchase. The Right of Purchase shall not apply to the Property after the recordation
by the City of the Certificate of Compliance.
Effect of Repurchase
16.3.7..The provisions of Section 16.6shall apply with
respect to the Repurchased Property following close of escrow. Following close of escrow,
under no circumstances shall Developeror any lienholderhave any right or claim to, or against,
the Repurchased Property. Notwithstanding the purchase of the Repurchased Property by the
City as provided in this Section 16.3, this Agreement shall remain in full force and effect with
respect to the portions of the Property and Improvements not purchased by the City.The Right
of Purchase shall not defeat or render invalid or limit any rights or interests provided in
easements, covenants, conditions or restrictions in favor of third parties who are not Developer
Affiliates that are approved by the City (or constituting a Permitted Transfer) and recorded on
the Repurchased Property purchased hereunder.
Survival of Provisions
16.3.8.. The provisions of this Section 16.3shall survive
the termination of this Agreement.
The Right of Reversion
16.4..
Following the Close of Escrowand prior to the recordation of the Certificate of
Compliance,in the event of the occurrence of any Reversion Action Trigger (defined in Section
16.4.1), and in addition to its other rights or remedies as a result of the occurrence of any such
Reversion Action Trigger, the City shall have the right on the terms and subject to the conditions
set forth in this Section 16.4 to re-enter and take possession of the Reacquired Property (as
Right of Reversion
defined below) and to revest title thereto in the City (the “”). The revesting
Reversion Event
of any Reacquired Property by the City is referred to herein as a “”,whether
based on voluntary action of Developer or otherwise after notice by the City of its intent to
exercise the Right of Reversion.The City shall be entitled to exercise the Right of Reversion at
any time on or after the occurrence of any of any one or more of the Reversion Action Triggers;
provided that the City has complied with the conditions to exercise of the Right of Reversion set
forth in Section 16.4.2. The Right of Reversion shall be a lien and encumbrance on the Property
that shall be paramount to the lien and charge of any Mortgage upon the Property.
Certain Defaults Triggering the Right of Reversion
16.4.1.. Following the
Close of Escrow and prior to the recordation of the Certificate of Compliance, the City may
exercise the Right of Reversion with respect any portion of the Development Parcels (except
those Lots for which Developer has been issued a building permit prior to the date of the City’s
election to purchase such land which has not expired as of the date of the City’s exercise of the
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Right of Reversion), and any Improvements thereon and all applicable Entitlements and other
development rights, consents, authorizations, variances, waivers, licenses, permits, certificates
and approvals from any governmental or quasi-governmental authority, and all other appurtenant
Reacquired Property
rights applicable thereto (collectively, the “”) upon the occurrence of any
Reversion Action Trigger
one of the following (each, a “,” and the date on which the Reversion
Reversion Action Trigger Date
Action Trigger occurs shall be referred to herein, as the “”):
(a)Developer fails to commence construction of the Horizontal
Improvements within nine(9) months or to Complete the Horizontal Improvements within thirty-
six (36) months after Close of Escrow,subject to extension for Force Majeure Delay for a period
not to exceed a total of twelve (12) months;
(b)Developer fails to Complete the Project within sixty (60) months
following opening of the Models to the public,as such date may be extended for Force Majeure
Delay (not to exceed a total of twelve (12) months);
(c)Developer commits waste on the Propertyand such becomes a
Material Default in accordance with the notice and cure provisions of Section 14.2, subject to
extension for Force Majeure Delay;
(d)For a period of one hundred eighty (180) consecutive calendar
days,Developer is in Material Default with respect to the Inventory Commitment set forth in
Section 8.9.2;
(e)For a period of one hundred eighty (180) consecutive calendar
days, Developer is in Material Default of the maintenance obligations set forth in Section 12.2
(including as set forth in the Special Restrictions, CC&Rs or LandscapeMaintenance
Agreement), in accordance with the notice and cure provisions of Section 14.2;
(f)The occurrence of a Developer Insolvency Event;
(g)The occurrence of a CFD Default which has become a Material
Default in accordance with the notice and cure provisions of Section 14.2.2and the failure of
Developer to paythe CFD Liquidated Damageswhendue; or
(h)A Material Default arises because of a voluntary or involuntary
Transfer or Transfer of Control.
Conditions to Exercise of the Right of Reversion
16.4.2.. The City shall be
entitled to exercise the Right of Reversion at any time on or after the applicable Reversion
Action Trigger Date, without regard to any notice and cure periods except asexpressly provided
inSection 16.4.1; provided that the City has provided written notice to Developer that the City
elects to exercise its Right of Reversion and such notice states the date for the Reversion Event.
The provisions of Section 16.5 shall beapplicable to exercise of the Right of Reversion. The
date for the Reversion Event shall not occur before the later of (a) the date that is ninety (90)
calendar days after the date of such notice of exercise,(b) the date that is five (5) Business Days
after Developer has had the opportunity to address the City Council at a public meeting
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regarding the Reversion Action Triggerand (c) the date that is five (5) Business Days following
the delivery of the City Repair Acknowledgmentwith respect to any repairs to the Improvements
made pursuant to Section16.4.4(a) below.In the event that, following the first notice by City of
its election to exercise the Right of Reversion and prior to the Reversion Event, Developer or any
Person on behalf of Developer either (a) cures the Reversion Action Trigger which is the basis
for the City’s exercise of its Right of Reversion or (b) Completes the Improvements prior to the
date of the Reversion Event, such Right of Reversion shall cease and terminate with respect to
such Reversion Action Trigger only; provided that the provisions of this sentence shall not be
applicable to any subsequent notice by the City of its election to exercise the Right of Reversion.
.
The provisions of Section 16.6 shall apply with respect to the Reacquired Property
Sale of Reacquired Property
16.4.3.. Upon the revesting in the City of title to
the Reacquired Property, the City shall use reasonable efforts to resell the Reacquired Property
as soon and in such manner as the City shall find feasible, in accordance with applicable state
law, if any, and consistent with the objectives of this Agreement, to a qualified and responsible
party or parties (as determined by the City in its sole discretion) who will assume the obligation
of making or completing the Improvements. Concurrently with the resale of the entire
Reacquired Property, or concurrently with each resale of any portion of the Reacquired Property,
the proceeds thereof shall be applied in the following order and amounts:
Delinquencies
(a). First, to repayment in full of all delinquent tax,
assessment and other liens with respect to the portion of the Reacquired Property sold;
Reimbursement to the City
(b). Second, to reimburse the City on its
own behalf for all costs and expenses incurred by the City, in connection with the recapture,
management and resale of the Reacquired Property, or any part thereof, including: a pro-rata
share of the salaries of personnel engaged in such action (based on the amount of time spent by
such personnel on such matters relating to the Reacquired Property as compared to the aggregate
amount of time worked by such personnel; all taxes, assessments and utility charges with respect
to the Reacquired Property; any payments made or necessary to be made to discharge or prevent
fromattaching or being made any subsequent encumbrances or liens due to obligations, Defaults
or acts of Developer or any Successor Owner or each and every Person claiming by, through or
under Developer or any Successor Owner; any expenditures made or obligations incurred with
respect to the making or completion of the agreed improvements or any part thereof on the
Reacquired Property; all costs of sale and marketing, including reasonable brokers’ fees and
costs incurred in the marketing and sale of the Reacquired Property; all legal fees and expenses;
all escrow and title fees and costs; all survey and due diligence fees and costs; all the Lien
Release Amounts, if any, paid by the City to third parties; and any amounts otherwise owing to
the City by Developer and/or any Successor Ownerunder this Agreement or the Other
Agreements, including any City Liensand the actual cost incurred by the City to acquire
environmental and pollution legal liability insurance coverage for theReacquired Property,
including coverage for loss, remediation expense and legal defense expenses.
Reimbursement to Developer
(c). Third, to reimburse Developer up
to the amount equal to the Repurchase Price attributable to the portion of the Reacquired
Property sold; and
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Balance Retained by the City
(d). Any balance remaining after such
reimbursements shall be retained by the City as its property.
Effect of Exercise of Right of Reversion
16.4.4..The provisions of Section 16.6
shall apply with respect to the Reacquired Property following close of escrow.Following such
close of escrow, under no circumstances shall Developeror any lienholderhave any right or
claim to, or against, the Repurchased Property. Notwithstanding the acquisition of the
Reacquired Property by the City as provided in this Section 16.4, this Agreement shall remain in
full force and effect with respect to the portions of the Property and Improvements not purchased
by the City.The City’s Right of Reversion shall not defeat or render invalid or limit any rights
or interests provided in easements, covenants, conditions or restrictions in favor of third parties
who are not Developer Affiliates that are approved by the City (or constituting a Permitted
Transfer) and recorded on the portionof the Property for whichthe City exercises its rights under
this Section16.4.
Cooperation and Grant of Easements
16.4.5.. Concurrently with close of
escrow for the Reacquired Property, the Parties shall each reserve and/or grant to the other such
roadway, utility, access and other easement rights as may be required by the other Party and its
successors in interest to develop the Property as a unified development and as contemplated by
the Entitlements, the CC&Rs, this Agreement and the Other Agreements.
Survival of Provisions
16.4.6.. The provisions of Section 16.4.3, 16.4.4andthis
Section 16.4.6shall survive the termination of this Agreement.
Access and Inspection
16.5.
Access
16.5.1. From and after the occurrence of any Repurchase Default, City
and its employees, agents and contractors shall have the non-exclusive right to enter upon at any
reasonable time, at its own cost and expense entirely and upon twenty four (24) hours prior
telephonic or email notice to Developer, the Potential Returned Property for the purpose of
making such feasibility and other studies, inspections, appraisals, audits, tests, evaluations,
investigations, surveys and reports of the Potential Returned Property (including, without
limitation, engineering and environmental audits, evaluations and tests relative to the presence of
any Hazardous Material within, under or upon the Potential Returned Property) (collectively,
“City Inspections”) as City may elect to make or obtain in connection with its exercise of its
Right of Purchase; provided that during such City Inspections on the Potential Returned
Property, City shall use commercially reasonable efforts to minimize its interference with
Developer’s activities on the Property. City shall indemnify, protect and defend Developer
against any and all Claims which Developer may incur or suffer by reason of any acts or
omissions to act of the City or its employees, contractors, or consultants in conduct of City
Inspections on the Potential Returned Property, provided that the foregoing indemnity shall not
apply to the extent of (i) the gross negligence, willful misconduct or fraud of Developer or any of
the Developer Representatives, (ii) Hazardous Materials conditions unless such condition is
exacerbated by, or any Release caused by, negligent acts of City or its employees, consultants or
contractors, or (iii) the Active Negligence of the Developer or any of the Developer
Representatives in performance of work on the Development Parcels Accruing prior to the close
of escrow.
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Inspection and Repair
16.5.2. At any time following the occurrence ofany
Repurchase Defaultor Reversion Action Trigger, the City may inspectthe Potential Returned
Property andall Improvements constructed by or on behalf of the Developer on the Potential
Returned Property,and subsequent to the delivery of written noticeby City to Developer of its
exercise of the Right of Purchase or the Right of Reversion, as applicable, City shall deliver
Defect Notice
written notice to Developer identifying any defects therein (“”). Withinthirty (30)
days following the delivery by the City of the Defect Notice, Developer shall cause all defects
specified in the Defect Notice to be rectified or repaired, and such repair shall be in accordance
with the original approved plans with respect thereto, if applicable. All costs and expenses of
Developer in repairing,replacing or rectifying any defects identified in a Defect Notice shall be
included within the definition of Horizontal Improvement Costs or Vertical Improvement Costs
for purposes of determining the Repurchase Price. Upon completion of the repairs of the
Improvements, or rectifying of any physical condition of the Potential ReturnedProperty,
including Environmental Matters, Developer and City shall inspect to confirm that such work has
been appropriately completed, and City shall execute and deliver to Developer a certificate
City Repair Acknowledgment
acknowledging the satisfactory completion of the work(the “”).
City shall have the right at any time, and without consent of Developer, to waive the obligation
of Developer to carry out or complete repairsand to proceed to close of escrow; provided that
City’s acquisition of the Returned Property shall be subject to the provisions of Section 16.6.3
and 16.6.4 notwithstanding the waiver.
Obligations and Release Following Repurchase or Reversion.
16.6.
Developer Obligations
16.6.1..In the event the City exercises its Right of
Purchase as to the Repurchased Property as provided in Section 16.3or its Right of Reversion as
the Reacquired Property as provided in Section 16.4this Agreement shall,unless otherwise
determined by the City in its sole discretion, terminate with respect to the Repurchased Property
Returned Property
or Reacquired Property, as applicable (each, the “”),as of the date of the
quitclaim deed conveying to the City title tothe ReturnedProperty. Except as set forth in
Section 16.6,all other obligations of the Parties under this Agreementwith respect to each other
shall be released and terminated as to the Returned Propertyonlyat the close of escrow for the
Returned Property.
Exceptions to Release
16.6.2.. Regardless of whether or not this Agreement is
terminated with respect to the Returned Property by the City, and notwithstanding the provisions
of Section 16.6.3 and 16.6.4, the close of escrow with respect to the Returned Property shall not
terminate or release any liability or obligations of Developer, any Builder Transferor or any
Responsible Developer with respect to such Returned Property for the following (and such
liability andobligations shall survive the close of escrow and shall not be merged into the
City Reserved Rights
quitclaim deed)(“”):
(i)to release the City and the Released Parties pursuant to
Section4.5.2(f);
(ii)to return any written Due Diligence Information with
respect to the ReturnedProperty pursuant to Section 14.3;
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(iii)to indemnify, defend and hold harmlesstheCity
Indemnified Parties as provided in Sections8.12(e), 8.15, 8.16and 17.12.1
for matters Accruing during the period of Developer’s ownership of the
Returned Propertyand with respect to any Developer, Responsible
Developeror Builder Transferor, duringthe Additional Liability Period;
(iv)to indemnify,defend and hold harmless the City
Indemnified Parties as provided in Section 5.5for matters occurring prior
to the Close of Escrow;
(v)to provide environmental insurance as described in Section
11.1.4 for the period required bythis Agreement, and not to modify or
terminate any prepaid environmental insurance policy then in existence for
a longer term; and
(vi)to indemnify, defend and hold harmlesstheCity
Indemnified Parties as provided in Section10.1with respect only to the
matters set forth in Section 16.6.3(c)(d) and (e)Accruing during the period
of Developer’s ownership of the Returned Propertyand,with respect to
any Developer, Responsible Developeror Builder Transferor, during the
Additional Liability Period:
AS-IS Conveyance
16.6.3.. City and Developer acknowledge and agree
that prior to the close of escrow City will have the full opportunity to inspect and investigate
every aspect of the Returned Property, including all matters related to the legal status thereof or
requirements with respect thereto, the zoning,the title condition,the economic conditions
affecting the value, expense of operation, or income potential thereof, Environmental Matters
and the physical condition and repair of the Returned Property and the Improvements thereon,
including the work performed by Developer with respect to construction of the Improvements,
andany construction defects, errorsoromissions with respect to the Returned Property, but
City Reserved Claims
excluding the City Reserved Claims. The “”shall mean all Claims
relating to or arising out of the following: (a)the City Reserved Rights;(b) City Liensand
amounts otherwise owedto the City by Developer and/or any Successor Owner(to the extent
that Developer is liable therefor under the terms of any agreement between Developer and the
City applicable to the Returned Property and not deducted from the Repurchase Price;(c)
information with respect to any aspect of the Returned Property contained in written or electronic
documentsin the possession of Developer or any of the Developer Representatives that arenot
proprietary or confidential andnot otherwise known or available to the City that the City has
specifically requested in writing and that Developer has declined to provide;(d)Claims other
than with respect to Environmental Matters brought against the CityIndemnified Partiesby third
partiesand Accruedduring the period that (x) Developer owned the Returned Property; and (y)
with respect to any Developer, Responsible Developeror Builder Transferor, for the Additional
Liability Period,as applicable;and (e)any Claim that is the result of the willful misconduct or
fraud of Developer or any of the Developer Released Parties. City specifically acknowledges
and agrees that, except for the City Reserved Claims, the ReturnedProperty, including any
Improvements thereon, is conveyed pursuant to Section 16.3 or Section 16.4, as applicable,in an
“AS IS” condition and “WITH ALL FAULTS” as of the date of the close of escrowfor the
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transfer of the Returned Property. For purposes of this Section 16.6.3, except as otherwise set
forth in Section 16.6, no statements, representations or warranties have been made orare made
by Developer and no responsibility has been or is assumed by Developer, or by any partner,
officer, employee, member, manager, person, firm, agent or representative acting or purporting
to act on behalf of Developer as to the Returned Property orthe Improvements thereon, or the
value, expense of operation or income potential thereof, and City is not relying upon any such
statement, representation or warranty. Further, to the extent that Developer has provided to City
information or reports regarding any inspection, engineering or other matters regarding the
Returned Property Matters, Developer makes no representations or warranties with respect to the
accuracy, completeness, methodology of preparation or otherwise concerning the contents of
such reports. City acknowledges that Developer has requested City to inspect fully the Returned
Property prior to the close of escrow and investigate all matters relevant thereto and to rely solely
upon the results of City’s own inspections or other information obtained or otherwise available to
Citywith respect thereto, rather than any information that may have been provided by Developer
to City. City’s acceptance of the quitclaim deed for the Returned Property shall constitute its
irrevocable declaration that it has fully inspected the Returned Property , or has been given a
reasonable opportunity to do so, and that it is fully satisfied with every aspect of the Returned
Property.Nothing in this Section shall limit the obligations of Developer, Responsible
Developer or Builder Transferor pursuant to Section 16.6.2.
Release.
16.6.4.Effective as of the close of escrow with respect to the Returned
Propertyand except as provided in Section 16.6.2and the City Reserved Claims, City shall, on
behalf of itself and eachSuccessor Owner and every Person claiming by, through or under City
City Releasing Party
or any Successor Owner (each a “”), waivethe right of each City Releasing
Party to recover from, and fully and irrevocably release, the Developer and its employees,
agents, attorneys, affiliates, representatives, consultants, contractors, successors and assigns
Developer Released PartyDeveloper Released
(individually, a “” and collectively, the “
Parties
”) from any and all Claims that City or any City Releasing Party may now have or
hereafter suffer arising from or related to the Returned Property , whether known or unknown by
any City Releasing Party or any Developer Released Party,including, without limitation:
(i)any condition of the Returned Property or any existing Improvement or future improvement
thereon, known or unknown by any City Releasing Party or any Developer Released Party,
including as to the extent or effect of any grading of the Returned Property; (ii) any construction
defects, errors, omissions or other conditions, latent or otherwise; (iii)economic and legal
conditions on or affecting the Returned Property, or any Improvement thereon; (iv)
Environmental Matters, including the existence, Release, threatened Release, presence, storage,
treatment, transportation or disposal of any Hazardous Materials at any time on, in, under, or
from, the Returned Property or any current or future improvement thereon or any portion thereof;
(v)Claims of or acts or omission to act of any Governmental Authority or any other third party
arising from or related to any actual, threatened, or suspected Release of a Hazardous Material
on, in, under, or fromorabout the ReturnedProperty or any current or future improvement
thereon, including any Investigation or Remediation at or about the ReturnedProperty or any
current or future improvement thereon; and/or (vi)arising from the Tustin Legacy Backbone
Infrastructure Program, any community facilities district or the cost or extent thereof with respect
to the Returned Property, or the amount of the Project Fair Share Contribution or any community
facilities district assessment against the Returned Property described in this Agreement not
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owing as of the date of the transfer. The foregoing release shall not extend to any City Reserved
Claims. Notwithstanding the foregoing, except as specifically set forth in this sentence, all City
Reserved Claims shall automatically be included within the matters released under this Section
effective upon the transfer or conveyance of the ReturnedProperty (or a portion thereof), to a
third party (as to the portion of the ReturnedProperty conveyed); provided that Developer shall
specifically not be released with respect to the City Reserved Claims specified in Section
16.6.2(a)(i) and (a)(iv),and Section 16.6.3(b) and (e).This release includes Claims with respect
to the foregoing released matters of which City is presently unaware or which City does not
presently suspect to exist (and which at the time of the close of escrow for the Returned Property
the City may be unaware or which the City may not then suspect to exist) which, if known by
City, would materially affect City’s release of the Developer Released Parties. Effective as of
the close of escrow for the Returned Property, with respect to the foregoing matters (and
specifically excluding the City Reserved Claims), City specifically waives the provision of
California Civil Code Section1542, which provides as follows:
“A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS
WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT
TO EXIST IN HIS OR HER FAVOR AT THE TIME OF
EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM
OR HER MUST HAVE MATERIALLY AFFECTED HIS OR
HER SETTLEMENT WITH THE DEBTOR.”
In this connection, City, on behalf of itself, and the other CityReleasing Parties hereby agrees,
that (x) it realizes and acknowledges that factual matters now unknown to it may have given or
may hereafter give rise to Claims or controversies which are presently unknown, unanticipated
and unsuspected, (y) the waivers and releases in this Section 16.6.4 have been negotiated and
agreed upon in light of that realization and (z) City, on behalf of itself and the other City
Releasing Parties, nevertheless hereby intends to release, discharge and acquit the Developer
Released Parties from any such unknown Claims and controversies to the extent set forth above.
To the extent permitted by law, the foregoing provisions of this Section16.6.4 shall survive the
close of escrow for the Returned Property and the termination of thisAgreement and shall not be
merged with any quitclaim deed.
City Responsibility in Sale to Third Party
16.6.5..City agrees to cause
Developer to be included as a benefited party under all release and indemnity provisions with
respect to the Returned Property andany Improvements thereon which are contained in any
agreement between the City and the third party transferee relating to the conveyance or transfer
of the ReturnedProperty or portion thereof, to the same extent as the City is released and/or
indemnifiedby such third party transferee.
CFD Default Remedies
16.7..IF DEVELOPER FAILS TIMELY TO VOTE,OR
VOTES AGAINST,THE FORMATION OF THE AD/CFD AND/OR THE TUSD CFD
WHICH COMPLIES WITH THE REQUIREMENTS OF SECTION 8.7.3,AND AS A
RESULT THEREOF ONE OR BOTH OF THEAD/CFD OR TUSD CFD FAILS TO BE
FORMED, SUCH ACT OR OMISSION SHALL BE A DEFAULT OF DEVELOPER UNDER
CFD DEFAULT
THIS AGREEMENT(“”). IF CITY HAS DELIVERED NOTICE OF A CFD
DEFAULT AND SUCH CFD DEFAULT IS NOT CURED BY DEVELOPERPRIOR TO
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EXPIRATION OF THE CUREPERIOD PROVIDED IN SECTION 14.2.2,DEVELOPER
CFD
SHALL BE REQUIRED TO PAY TO THE CITY AS LIQUIDATED DAMAGES(THE “
LIQUIDATED DAMAGES
”),THE FOLLOWING AMOUNT(S) WHICH SHALL BE DUE
THIRTY (30)CALENDARDAYS FOLLOWING NOTICE BY CITY TO DEVELOPER
THAT SUCH CFD DEFAULT HAS BECOME A MATERIAL DEFAULT:
(a)IF THE CFD DEFAULT IS WITH RESPECT TO TAX AANDTHE
TUSD CFD, THE AMOUNT OF TWENTY THREE MILLION NINE HUNDRED
THOUSAND DOLLARS ($23,900,000). IF THE CFD DEFAULT IS WITH RESPECT TO
ONE OF THE TAX A OR TUSD CFD, BUT NOT BOTH, THEN THE CFD LIQUIDATED
DAMAGES FOR THE CFD DEFAULT WITH RESPECT TO THE CFD TO WHICH THE
CFD DEFAULT APPLIES SHALL BE EQUAL TO THE AMOUNT DETERMINED
PURSUANT TO ATTACHMENT 26; AND
(b)IF THE CFD DEFAULT IS WITH RESPECT TO TAX B, THE
AMOUNT OF TWENTY MILLION DOLLARS ($20,000,000).
SUCHDAMAGES SHALL BE THE CITY’S SOLE AND EXCLUSIVE REMEDY
UNDER THIS AGREEMENT WITH RESPECT TO A CFD DEFAULT BY DEVELOPER,
EXCEPT FOR THE CITY’S RIGHTS AND REMEDIES FOR A SEPARATE BREACH, IF
ANY, OF THE PROVISIONS OF THIS AGREEMENT.NOTWITHSTANDING THE
FOREGOINGOR ANY OTHER PROVISION OF THIS AGREEMENT,IF DEVELOPER
SHALL FAIL TO PAY THE CFD LIQUIDATED DAMAGES DESCRIBED BY THIS
SECTION WHEN DUE, NOTHING IN THIS AGREEMENT SHALL PRECLUDE OR
PREVENT THE CITY FROM EXERCISING ITSADDITIONAL REMEDIES UNDER THIS
AGREEMENT OR UNDER THE DA WITH RESPECT TOABREACH OF THE
PROVISIONS RELATED TO THE AD/CFD AND TUSD CFD, WHICH SHALL BE
EXERCISED, IF AT ALL, IN THE GOVERNMENTAL CAPACITY OF THE CITY.
THE PARTIES ACKNOWLEDGE AND AGREE BY INITIALING THIS
AGREEMENT IN THE SPACE PROVIDED BELOW THAT(A) THE CFD PAYMENTS
BEAR A REASONABLE RELATIONSHIP TO THE DAMAGES WHICH THE PARTIES
ESTIMATE MAY BE SUFFERED BY THE CITY AS THE RESULT OF A CFD DEFAULT
BY DEVELOPER, WHICH DAMAGES WOULD BE IMPRACTICAL OR EXTREMELY
DIFFICULT TO QUANTIFY, (B) SUCH LIQUIDATED DAMAGE AMOUNTS
CONSTITUTE A REASONABLE ESTIMATE OF THE CITY’S DAMAGES IN SUCH
EVENT, AND (C)THE REMEDY PROVIDED FOR IN THIS SECTION IS NOT A
PENALTY OR FORFEITURE AND IS A REASONABLE LIMITATION ON DEVELOPER’S
POTENTIAL LIABILITY AS A RESULT OF CFDDEFAULT.
IN THE EVENT THAT THE DEVELOPER HAS PAID THE REQUIRED AMOUNTS
SET FORTH IN CLAUSE (a)OR(b) ABOVE AS THE RESULT OF A CFD DEFAULT, CITY
SHALL NOT THEREAFTER CAUSE OR PERMIT THE FORMATION OR IMPOSITION OF
THE AD/CFD CORRESPONDINGTO THE TAX A AND/OR TAX B LIQUIDATED
DAMAGESPAID, AND SHALL TAKE ANY ACTION WITHIN ITS POWER TO PREVENT
THE IMPOSITION OF THE TUSD CFD IN THE EVENT THE TUSD CFD LIQUIDATED
DAMAGES ARE PAID.FURTHER, IN SUCH EVENT, DEVELOPER SHALL HAVE THE
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RIGHT TO OPPOSE BY ANY MEANS LEGALLY AVAILABLE THE FORMATION OR
IMPOSITION OF THE AD/CFD OR TUSD CFD, AS APPLICABLE, AND SUCH ACTIONS
SHALL NOT CONSTITUTE A DEFAULT BY DEVELOPER UNDER THIS AGREEMENT.
___________________________________
Initials of CityInitials of Developer
Cooperation of Developer
16.8..
If the City exercises its Right of Purchase or Right of Reversion in accordance with the
provisions of this Agreement, Developer shall use all reasonable efforts to take, or cause to be
taken, all actions and to do, or cause to be done, all things necessary or desirable under
applicable law to consummate the repurchase of the Repurchased Property or revesting of the
Reacquired Property, as the case may be, including the execution and delivery of such other
documents, certificates, agreements, deeds and other writings and the taking of such other
actions as may be reasonably necessary to consummate such transactions.
General Provisions
17..
Applicable Law; Consent to Jurisdiction; Service of Process
17.1..
This Agreement shall be governed by, interpreted under, construed and enforced in
accordance with the laws of the State, irrespective of California’s choice-of-law principles.
Developer and City agree that any disputes arising between them in connection with this
Agreement or in connection with or under any instrument, agreement or document provided for
or contemplated by this Agreement, including in connection with the execution of this
Agreement, the Close of Escrow orany other matter arising under, related to or in connection
with this Agreement (including a determination of any and all issues in such dispute, whether of
fact or of law) shall be tried and litigated exclusively in the Superior Court of the County of
Orangein theState, in any other appropriate court of that county, or in the United States District
Court for the Central District of California. This choice of venue is intended by Developer and
the City to be mandatory and not permissive in nature, thereby precluding the possibility of
litigation between or among Developer and the City with respect to or arising out of this
Agreement in any jurisdiction other than that specified in this Section 17.1. Each Party hereby
waives any right that it may have toassert forum non conveniens or similar doctrine or to object
to venue with respect to any proceeding brought in accordance with this Section 17.1, and
stipulates that the State and federal courts located in the County of Orange, in the State, shall
have in personam jurisdiction and venue over each of them for the purpose of litigating any
dispute, controversy or proceeding arising out of this Agreement. Each Party hereby authorizes
and accepts service of process sufficient for personal jurisdiction in anyaction against it as
contemplated by this Section 17.1 by means of registered or certified mail, return receipt
requested, postage prepaid, to its address for the giving of notices as set forth in this Agreement,
or in the manner set forth in Section 17.6(a) or (c) of this Agreement pertaining to notice. Any
final judgment rendered against a Party in any Action shall be conclusive as to the subject of
such final judgment and may be enforced in other jurisdictions in any manner provided by law.
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Legal Feesand Costs
17.2..
If any Party to this Agreement institutes any action, suit, proceeding, counterclaim or
other proceeding for any relief against another Party, declaratory or otherwise (collectively an
Action
“”), to enforce the terms hereof or to declare rights hereunder or with respect to any
inaccuracies or material omissions in connection with any of the covenants, representations,
warranties or obligations on the part of the other Party to this Agreement, then the Prevailing
Party in such Action shall be entitled to have and recover of and from the other Party all costs
and expenses of the Action, including (a) reasonable attorneys’ fees which shall be payable at the
contractual hourly rate for City’s litigation counsel at the time the fees were incurred, but in no
event less than $200 per hour and (b) costs actually incurred in bringing and prosecuting such
Decision
Action and/or enforcing any judgment, order, ruling or award (collectively, a “”)
granted therein, all of which shall be deemed to have accrued on the commencement of such
Action and shall be paid whether or not such Action is prosecuted to a Decision. Any Decision
entered in any final judgment shall contain a specific provision providing for the recovery of all
costs and expenses of suit, including reasonable attorneys’ fees and expert fees and costs
Costs
(collectively “”) incurred in enforcing, perfecting and executing such judgment. For the
purposes of this paragraph, Costs shall include in addition to Costs incurred in prosecution or
defense of the underlying action, reasonable attorneys’ fees, costs, expenses and expert fees and
costs incurred in the following: post judgment motions and collection actions,contempt
proceedings,garnishment, levy, debtor and third party examinations,discovery,bankruptcy
Prevailing Party
litigation and appeals of any order or judgment. “” within the meaning of this
Section 17.2 includes a Party who agrees to dismiss an Action in consideration for the other
Party’s payment of the amounts allegedly due or performance of the covenants allegedly
breached, or obtains substantially the relief sought by such Party.
Modifications or Amendments
17.3..
No amendment, change, modification or supplement to this Agreement shall be valid and
binding on any of the Parties unless it is represented in writing and signed by each of the Parties
hereto.
Further Assurances
17.4..
Each of the Parties hereto shall execute and deliver at their own cost and expense, any
and all additional papers, documents, or instruments, and shall do any and all acts and things
reasonably necessary or appropriate in connection with the performance of its obligations
hereunder in order to carry out the intent and purposes of this Agreement.
Rights and Remedies Are Cumulative; Limitation on Damages
17.5..
Cumulative Remedies
17.5.1.. Except with respect to the rights and remedies
expressly declared to be exclusive in this Agreement or the Other Agreements, the rights and
remedies of the Parties are cumulative, and the exercise by either Party of one or more 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 Material Default or any other Material Default by the other
Party. Except as otherwise specifically set forth in this Agreement, and subject to Section 17.5.2,
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wherever a Party has a right to damages for the Material Default of another Party: (a) such
damages shall be limited to direct (actual) damages for the Material Default of the other Party,
and (b) each of the Parties, on behalf of itself and its successors and assigns, hereby expressly
waives, releases and relinquishes any and all right to any expectation, anticipation, indirect,
consequential, exemplary or punitive damages.
Limitation on Damages Payable by the City
17.5.2.. Developer acknowledges
that the City would not have entered into this Agreement if the City could become liable for
significant damages under or with respect to this Agreement and the Other Agreements.
Consequently, and notwithstanding any other provision of this Agreement, except for (a) the
monetary damages that may arise from the City’s indemnity obligations referenced below in
Section 17.5.3, and (b) the payment of attorneys’ fees in accordance with Section 17.2 and court
costs, the City shall not be liable in damagesunder this Agreement or any Other Agreement to
Developer or to any Successor Owner and Developer, on behalf of itself and each Successor
Ownerhereby waives any and all rights to claim damages of any kind or nature from the City
except as set forth in Section 17.5.3. Notwithstanding the foregoing, nothing herein shall be
deemed to preclude Developer from seeking payment for amounts which the City is obligated to
pay to Developer or Escrow Holder pursuant to Sections 7.4.1, 7.4.4, 14.2.4, 15.1.2or 15.3.3 of
this Agreement, provided that Developer shall not be entitled to any damages in addition to the
actual amounts owed by the City to Developer pursuant to this Agreement or the Other
Agreements.
Special Circumstances Where Damages may be Payable by the City
17.5.3..
Subject to Section 17.5.1, the limitations on damages set forth in Section 17.5.2 shall not limit
the liability of the City, if any, for damages which arise out of (a) a breach of the City’s
representations and warranties contained in Sections 3.3 or 17.12 of this Agreement, provided
that the amount of any damages payable pursuant to this clause (a) shall be the lesser of (i) actual
damages, or (ii) Five Hundred Thousand Dollars ($500,000) or (b) the exercise of any of the
rights reserved to the City pursuant to Section 4.1(a)(i) or (ii) and as the same shall be included
in the Quitclaim Deed.
Right to Specific Performance
17.5.4.. In the event the City is in Material
Default following the Close of Escrow, Developer shall be entitled to seek specific performance
or injunctive relief in order to enforce Developer’s rights pursuant to this Agreement. For
purposes of clarity, in the event that the City is obligated to pay any amounts to Developer
pursuant to this Agreement, and the City fails to pay such amounts toDeveloper as and when
required by this Agreement, Developer shall be entitled to seek specific performance of such
obligation, notwithstanding the other provisions of this Section 17.5.
Notices, Demands and Communications between the Parties
17.6..
All notices,demands, consents, requests and other communications required or permitted
to be given under this Agreement shall be in writing and shall be deemed conclusively to have
been duly given (a) when hand delivered to the other Party; (b) three (3) Business Days after
such notice has been sent by U.S. Postal Service via certified mail, return receipt requested,
postage prepaid, and addressed to the other Party as set forth below; (c) the next Business Day
after such notice has been deposited with an overnight delivery service reasonably approved by
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the Parties (Federal Express, Overnite Express, United Parcel Service and U.S. Postal Service are
deemed approved by the Parties), postage prepaid, addressed to the Party to whom notice is
being sent as set forth belowwith next-business-day delivery guaranteed, provided that the
sending Party receives a confirmation of delivery from the delivery service provider; or (d) when
transmitted if sent by facsimile transmission or email to the fax number or email address set forth
below; provided that notices given by facsimile or email shall not be effective unless either (i) a
duplicate copy of such notice is promptly sent by any method permitted under this Section17.6
other than byfacsimile or email (provided that the recipient Party need not receive such
duplicate copy prior to any deadline set forth herein); or (ii) the receiving Party delivers a written
confirmation of receipt for such notice either by facsimile, email or any other method permitted
under this Section. Any notice given by facsimile or email shall be deemed received on the next
Business Day if such notice is received after 5:00 p.m. (recipient’s time) or on a non-Business
Day. Unless otherwise provided in writing, all notices hereunder shall be addressed as follows:
City:City of Tustin
Attn: Jeffrey C. Parker, City Manager
300 Centennial Way
Tustin, CA 92780
Fax: 714-838-1602
Email: jparker@tustinca.org
With a copy to:Woodruff Spradlin & Smart, APC
Attn: David Kendig, Esq., City Attorney
555 Anton Boulevard, #1200
Costa Mesa, CA 92626
Fax: (714) 415-1183
Email: dkendig@wss-law.com
And to:
Armbruster Goldsmith & Delvac LLP
Attn: Amy E. Freilich, Esq., Special Counsel
11611 San Vicente Blvd., Suite 900
Los Angeles, CA 90049
Fax: (310) 209-8801
Email: amy@agd-landuse.com
Developer:Standard Pacific Corp.
Attn: Ted McKibbin
15360 Barranca Parkway
Irvine, CA 92618
Fax: (949) 789-1745
Email: TMcKibbin@stanpac.com
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With a copy to:Rutan & Tucker, LLP
Attn: Kevin Brazil, Esq.
611 Anton Boulevard, Suite 1400
Costa Mesa, CA 92626
Fax: (714) 546-9035
Email: kbrazil@rutan.com
Any Party may by written notice to the other Party in the manner specified in this
Agreement change the address to whichnotices to such Party shall be delivered.
Delay
17.7..
Definition of Force Majeure DelayForce Majeure Delay
17.7.1.. “” shall mean
the occurrence of any of the following events when such event is beyond the control of the First
Party and such Party’s contractors and consultants and is not due to an act or omission of such
Party or any consultant, contractor or other Person for whom such Party may be contractually or
legally responsible, which directly, materially and adversely affects the ability of the FirstParty
to meet its non-monetary obligations under this Agreement, including the deadlines imposed by
the Schedule of Performance, or the ability of Developer to Complete the Project, and which
events (or the effect of which events) could not have been avoided by duediligence and use of
reasonable efforts by the Party claiming Force Majeure Delay:
(a)Civil Unrest.An epidemic, blockade, quarantine,
rebellion, war, insurrection, act of terrorism, strike or lock-out, riot, act of sabotage, civil
commotion, act of a publicenemy, freight embargo, or lack of transportation;
(b)Unforeseeable Conditions. Reasonably unforeseeable
physical condition of the Property including the presence of Hazardous Materials;
(c)Casualty. Fire, earthquake or other casualty, including
liquefaction resulting from an earthquake, in each case only if causing material physical
destruction or damage on the Property;
(d)Litigation. Any lawsuit seeking to restrain, enjoin,
challenge or delay any issuance of any Entitlement or seeking to restrain, enjoin, challenge, or
delay construction of the Project, which is defended by the FirstParty;
(e)Change of Law. The passage of a referendum or initiative
that results in the inability of such Party to perform its material obligations hereunder; provided
that the foregoing shall not apply to a Party’s performance regarding the Close of Escrow, which
are governed by Section 7 and Section 15;
(f)Weather. Unusually severe weather conditions not
reasonably anticipatable for the City of Tustin, based upon U.S. Weather Bureau climatological
reports for the months included plus a report indicating average precipitation, temperature, etc.
for the last ten (10) years from the nearest reporting station.
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LimitationForce Majeure Delay
17.7.2.. The term “” shall be limited to the
matters listed Section 17.7.1 and specifically excludes from its definition the following matters
which might otherwise be considered Force Majeure Delay:
(a)Entitlements. The suspension, termination, interruption,
denial or failure to obtain or nonrenewal of any Entitlement, permit, license, consent,
authorization or approval which is necessary for the development of the Project, except for any
such matter resulting from a lawsuit or referendum as described in Section 17.7.1(d) or (e);
(b)Foreseeable Changes in Governmental Requirements. Any
change in Governmental Requirements which was proposed or was otherwise reasonably
foreseeable at the Effective Date;
(c)Failure to Perform Obligations. Failure of Developer to
perform any obligation to be performed by Developer hereunder asthe result of adverse changes
in the financial condition of Developer or such Successor Owner, as applicable;
(d)Failure to Provide Financial Security. Failure of Developer
or any Successor Owner to provide financial security required by this Agreement whendue or to
submit evidence of financing of the Project or to perform any obligation to be performed by
Developer or any Successor Owner hereunder as the result of adverse changes in market
conditions;
(e)Failure to Submit Required Documentation. Failure of the
FirstParty to submit documentation as and when required by this Agreement;
(f)Failure to Submit Basic Concept Plan, Other Plans and
Entitlements. Failure to submit a Basic Concept Plan and Concept Plan and Design Review
submittals, and/or submittals for other Entitlements required for construction of the
Improvements and/or development of the Project on the Property when required pursuant to the
Pre-Closing Schedule or the Schedule of Performance;
(g)Failure to Maintain Required Insurance. Failure to acquire,
maintain and submit evidence of insurance policies as required by Section 11;
(h)Failure to Execute Documents. Failure of the Firstparty to
execute documents; and
(i)Other Matters. All other matters not caused by the Second
Party and not listed in Section 17.7.1(a) through (f).
ProcedureFirst Party
17.7.3..If any Party (the “”) believes that it is entitled to
Second
an extension of time due to Force Majeure Delay, it shall notify the other Party (the “
Party
”) in writing within ninety (90) calendar days from the date upon which the First Party
becomes aware of such Force Majeure Delay, generally describing the Force Majeure Delay and
its date of commencement. Upon written request from the Second Party, the First Party shall
promptly provide the following information with respect to such Force Majeure Delay: a more
detailed description of the Force Majeure Delay, when and how the First Party obtained
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knowledge thereof, the steps the First Party anticipates taking to respond to such Force Majeure
Delay, and the estimated delay resulting from such Force Majeure Delay and responseand such
other information as the Second Party may reasonable request. The extension for Force Majeure
Delay shall be granted or denied in the Second Party’s reasonable discretion. If the First Party
fails to notify the Second Party in writing of its request for a given Force Majeure Delay within
the ninety (90) calendar days specified above, there shall be no extension for such Force Majeure
Delay.
Extension of Time Periods
17.7.4.. Except as otherwise specifically set forth in
this Agreement, all time periods under this Agreement, including the Schedule of Performance,
relating to non-monetary obligations under this Agreement shall be extended for Force Majeure
Delay in accordance with this Section 17.7, such that no Party shall be in defaultfor an excused
Force Majeure Delay.
Not Applicable to Reversion Action Dates
17.7.5..Exceptas set forth in
Section 16.4.1, the Reversion Action Dates shall not be extended for Force Majeure Delay.
Conflict of Interest.
17.8.
No appointed or elected official or employee of the City shall have any personal interest,
direct or indirect, in this Agreement nor shall any official or employee participate in any decision
relating to the Agreement which affects his interests or the interests of any corporation,
partnership, or association in which he is directly or indirectly interested.
Non-liability of City Officials and City or Developer Employees
17.9..
No elected or appointed official, representative, employee, agent, consultant, legal
counsel or employee of the City shall be personally liable to Developer, or any successor in
interest in the event of any Default or breach by the City for any amount which may become due
to Developer or successor or on any obligation under the terms of this Agreement. No
representative, agent, consultant, legal counsel or employee of Developer shall be personally
liable to the City in the event of any Default or breach by Developer for any amount which may
become due to the City or successor or on anyobligation under the terms of this Agreement.
Inspection of Books and Records
17.10..
The City shall have the right at all reasonable times, upon ten (10) calendar days written
notice, to inspect the books and records of Developer pertaining to the Property aspertinent to
the purposes of this Agreement.
Consents and Approvals
17.11..
Consent
17.11.1.. In any instance in which a Party shall be requested to consent
to or approve of any matter with respect to which such Party’s consent or approval is required by
any of the provisions of this Agreement, such consent or approval shall be given in writing. In
addition, whenever not expressly otherwise stated: (a) the City, when acting in its Governmental
Capacity shall be permitted to utilize its sole discretion with respect tomatters requiring its
approval except as otherwise specified in any applicable Governmental Requirements; (b) the
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City, when acting in its Proprietary Capacity shall not unreasonably withhold, condition or delay
its approvals with respect to matters requiring its approval hereunder; and (c) Developer shall not
unreasonably withhold, delay or condition its consent with respect to matters requiring its
approval hereunder.
Deemed Submitted
17.11.2.. Any matter required by this Agreement to be
submitted to the City shall be deemed submitted upon the submittal to the City Manager or
designee.
Action Taken
17.11.3.. Following its approval by the City, this Agreement shall
be administered by any designee of the City Manager or the City Manager. Except where the
terms of this Agreement expressly require the approval of a matter or the taking of any action by
the City Council, any matter to be approved by the City shall be deemed approved, and any
action to be taken by the City shall be deemed taken, upon the written approval by the City
Manager (or designee). The City Manager or designee shall have the authority to issue
interpretations with respect to this Agreement and to determine whether any action requires the
approval of the City Council. All amendments or modifications ofthis Agreement shall require
the approval of the City Council. All waivers and extensions of time for performance under this
Agreement shall be approved by the City Manager (or designee) unless in the City Attorney’s
opinion such action requires a waiverto be approved by the City Council under applicable law.
No Real Estate Commissions
17.12..
17.12.1.The City shall not be liable for any real estate commissions, brokerage
fees or finder’s fees which may arise from this Agreement. 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.
Developer hereby agrees to indemnify and hold the City and its electedand 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 Developer regarding this
Agreement or development of the Project orthe transactions identified in this Agreement.
17.12.2.The City represents that it has engaged no broker, agent, or finder in
connection with this Agreement or the transactions identified in this Agreement.
17.12.3.The indemnity set forth in this Section 17.12 shall survive the
termination of this Agreement.
Date and Delivery of Agreement
17.13..
Notwithstanding anything to the contrary contained in this Agreement, the Parties intend
that this Agreement shall be deemed effective, executed and delivered for all purposes under this
Agreement and for the calculation of any statutory time periods based on the date an agreement
between the Parties is effective, executed and/or delivered, as of the Effective Date.
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Constructive Notice and Acceptance
17.14..
Every Successor Owner and each and every Person claiming by, through or under
Developer or any Successor Owner is and shall be conclusively deemed to have consented and
agreed to every provision contained herein, whether or not any reference to this Agreement is
contained in the instrument by which such Person acquired an interest in the Project or Property.
Survival of Covenants, Representation and Warranties
17.15..
The covenants, representations, warranties, and indemnities specified in this Agreement
shall survive any investigation made by any Party hereto and the closing of the transactions
contemplated hereby until the termination of this Agreement.This Agreement and the
covenants, representations, warranties and indemnities specified herein shall run with the
Development Parcels, and except as provided herein, be binding upon all Successor Owners,
unless and until terminated in accordance with the terms of this Agreement. Notwithstanding
anything contained in this Agreement to the contrary, except for the express provisions contained
in the Quitclaim Deed, this Agreement and the obligations, covenants, conditions and restrictions
set forth herein shall not run with that portion of the Development Parcels Transferred to an End
User, and each End User shall take title to that portion of theDevelopment Parcels conveyed to it
free and clear of the lien or charge of this Agreement or any of the obligations, covenants,
conditions and restrictions set forth herein.
Construction and Interpretation of Agreement
17.16..
Construction
17.16.1.. The language in allparts of this Agreement shall in all
cases be construed simply, as a whole and in accordance with its fair meaning and not strictly for
or against any Party. The Parties hereto acknowledge and agree that this Agreement has been
prepared jointly by the Parties and has been the subject of arm’s length and careful negotiation
over a considerable period of time, that each Party has been given the opportunity to
independently review this Agreement with legal counsel, and that each Party has the requisite
experience and sophistication to understand, interpret, and agree to the particular language of the
provisions hereof. Accordingly, in the event of an ambiguity in or dispute regarding the
interpretation of this Agreement, this Agreement shall not be interpreted or construed against the
Party preparing it; instead other rules of interpretation and construction shall be utilized. The
provisions of California Civil Code Section1654 are specificallywaived by each Party hereto.
Effect of Invalidity or Unenforceability
17.16.2.. If any term or provision of
this Agreement, the deletion of which would not adversely affect the receipt of any material
benefit by any Party hereunder, shall be held by a court of competent jurisdiction to be invalid or
unenforceable, the remainder of this Agreement shall not be affected thereby and each other term
and provision of this Agreement shall be valid and enforceable to the fullest extent permitted by
law. It is the intention of the Parties hereto that in lieu of each clause or provision of this
Agreement that is illegal, invalid, or unenforceable, there be added as a part of this Agreement an
enforceable clause or provision as similar in terms to such illegal, invalid, or unenforceable
clause or provision as may be possible.
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Captions
17.16.3.. The captions of the sections and clauses in this Agreement are
inserted solely for convenience and under no circumstances are they or any of them to be treated
or construed as part of this instrument.
References to Sections, Clauses and Attachments
17.16.4.. Unlessotherwise
indicated, references in this Agreement to sections, clauses and attachments are to the same
contained in or attached to this Agreement and all attachments referenced in this Agreement are
incorporated in this Agreement by this reference as though fully set forth in this Section.
Gender, Singular and Plural
17.16.5.. As used in this Agreement and as the
context may require, the singular includes the plural and vice versa and the masculine gender
includes the feminine and vice versa.
Includes and Including
17.16.6.. As used in this Agreement the words
“include” and “including” mean, respectively, “include, without limitation” and “including,
without limitation”.
Time of Essence
17.17..
Time is of the essence with respect to all provisions of this Agreement in which a definite
time for performance is specified; provided that the foregoing shall not be construed to limit or
deprive a Party of the benefits of any cure period or Force Majeure Delay expressly provided for
in this Agreement.
Fees and Other Expenses
17.18..
Except as otherwise provided in this Agreement, each of the Parties hereto shall pay its
own fees and expenses, including attorneys’ fees, experts’ fees and consultants’ fees and costs, in
connection with negotiation and preparation of this Agreement and compliance with its terms.
No Partnership
17.19..
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 Developer.
Binding Effect
17.20..
This Agreement and terms, provisions, promises, covenants, conditions and restrictions
contained herein shall be binding upon andshall inure to the benefit of the Parties hereto and
their respective heirs, legal representatives, successors and assigns.
No Third Party Beneficiaries
17.21..
This Agreement has been made and entered into solely for the benefit of the Parties to
this Agreementand their respective successors and permitted assigns. Nothing in this
Agreement confers any rights or remedies on any other Person. Nothing in this Agreement
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relieves or discharges the obligation or liability of any third Persons to any Parties to this
Agreement.
Counterparts
17.22..
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 or other electronically transmitted
signatures; provided that such execution by facsimile or electronic transmission shall not be
effective unless a manually executed copy of the signature page is promptly sent by U.S. Postal
Service, postage prepaid or overnight delivery service or is hand delivered to the Parties or
Escrow Holder pursuant to Section 4.4. The Parties hereby authorize each other (and Escrow
Holder) 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.
Duplicate Originals, Entire Agreement and Waivers
17.23..
Duplicate Originals
17.23.1.. This Agreement is executed in three (3) duplicate
originals, each of which is deemed to be an original.
Entire Agreement
17.23.2.. This Agreement, including the Attachments hereto,
together with the Other Agreements, constitute the entire agreement between the Parties with
respect to the subject matter hereof. Except as set forth in the last sentence of this Section
17.23.2, this Agreement and the Other Agreements supersede and replace any and all prior
agreements, proposed agreements, negotiations and communications, oral or written, relating to
the subject matter hereof and contain the entire agreement between the Parties as to the subject
matter hereof and any and all prior agreements, understandings or representations between the
Parties and/or any Developer Affiliate are hereby terminated and canceled in their entirety. Each
Party hereby acknowledges that no other Party hereto, nor its agents or attorneys, have made any
promises, representations or warranties whatsoever, expressed or implied, not contained in this
Agreement or the Other Agreements, to induce such Party to execute this Agreement, and each
Party acknowledges that it has not executed this Agreement in reliance on any such promise,
representation or warranty not contained in this Agreement or any Other Agreements. For the
avoidance of doubt, this Agreement shall terminate and supersede the RFP, the responses of
Developer or any Developer Affiliate in connection therewith and the ENA, except that this
Agreement does not supersede Sections 3.5, 4.3.6, 4.5.2, 4.5.3, 6.9.2, 10.2 or 10.13 of the ENA
which shall remain in effect with respect to claims arising during the term of the ENA.
No Waiver
17.23.3.. No waiver of any provision or consent to any action
under this Agreement shall constitute a waiver of any other provision or consent to any other
action, whether or not similar. No waiver or consent shall constitute a continuing waiver or
consent or commit a Party to provide a waiver in the future except to the extent specifically set
forth in writing. All waivers of the provisions of this Agreement must be in writing and signed
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by the appropriate authorities for the City and Developer and all amendments hereto must be in
writing and signed by the appropriate authorities of the City and Developer.
Confidentiality
17.24..
Non-Disclosure and Exceptions
17.24.1.. Subject to the provisions of the
Public Records
California Public Records Act (Government Code Section 6250 et seq.) (the “
Act
”), which governs the City’s use and disclosure of its agreements and records, the City and
Developer hereby agree that each shall keep confidential information provided by the other and
denominated as confidential and will not disclose any such information to any Person without
obtaining the prior written consent of the other Party, except that (a) the City shall have the right
to disclose any information contained in any third party reports produced or obtained by
Developer and required to be disclosed by it pursuant to law, (b) Developer shall have the right
to disclose any Developer Excluded Information, (c) the City shall have the right to disclose any
City Excluded Information, (d) Developer shall have the right to disclose to its consultants,
members, and their respective consultants and members, any information to the extent necessary
or desirable in connection with Developer’s due diligence on the Property and performance of its
obligations under this Agreement and the Other Agreements, (e) City shall have the right to
disclose to its officials, employees and City retained consultants and representatives all
information received by it from Developer as required to perform its obligations under this
Agreement and the Other Agreements, and (f) either Party shall have the right to disclose any
information to the extent that it is legally required or compelled to do so provided that (to the
extent permitted) it provides the other Property with prior notice of such disclosure obligation
and cooperates with such other Party (at no cost or liability to the cooperating Party) in any
attempts to obtain confidential treatment of such disclosed information. Developer’s obligations
pursuant to this Section 17.24 shall terminate upon the Close of Escrow. Except with respect to
material described in Section 17.24.2, the City’s obligations pursuant to this Section 17.24 shall
terminate upon the Close of Escrow.
Financial Information
17.24.2.. Developer shall identify with specificity any
submitted financial documents which Developer wants the City to maintain as confidential
documents and a statement as to why the request is consistent and complies with the provisions
of the Public Records Act. The City shall not disseminate such information and shalltake all
reasonable steps to maintain such confidentiality, including maintenance of such documents at a
non-public location, unless otherwise required by law. The City’s staff, agents, negotiators and
consultants may review the statements as necessary as long as such parties agree to maintain the
confidentiality of such statements.
Cooperation
17.24.3.. In the event that the City obtains a request pursuant to the
provisions of the Public Records Act to disclose any of Developer’sinformation which the City
is required to keep confidential pursuant to the terms of this Agreement, the City shall provide
Developer with prompt written notice thereof and the City and Developer shall cooperate at
Developer’s sole cost and expense to seek to avoid disclosure of such matters to the extent
legally permissible pursuant to the provisions of the Public Records Act.
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Proprietary and Governmental Roles; Actions by Parties
17.25..
Except where clearly and expressly provided otherwise in this Agreement, the capacity of
the City in this Agreement shall be as owner, lessor, assembler, redeveloper and/or seller of
Proprietary Capacity
property only (“”), and any obligations or restrictions imposed by this
Agreement on the City, shall be limited to that capacity and shall not relate to, constitute a
waiver of, supersede or otherwise limit or affect the exercise by the City of its governmental
authority with respect to any matter related to this Agreement which shall include the regulation
and entitlement of the Property pursuant to Governmental Requirements, including enacting
laws, inspecting structures, reviewing and issuing permits, and all of the other legislative and
administrative or enforcement functions of each pursuant to federal, state or local law
Governmental Capacity
(“”). In addition, nothing in this Agreement shall supersede or waive
any discretionary or regulatory approvals required to be obtained from the City under applicable
Governmental Requirements.
[signature page follows]
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Disposition and Development AgreementCity of Tustin/Standard Pacific
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IN WITNESS WHEREOF, the City and Developer have signed this Agreement as of the
date first set forth above.
CITY OF TUSTIN:
Dated:
By:
Jeffrey C. Parker,
City Manager
ATTEST:
By:
Erica Rabe
City Clerk Services Supervisor
APPROVED AS TO FORM
By:
David Kendig,
City Attorney
Armbruster Goldsmith & Delvac LLP
Special Real Estate Counsel to the City
By:
Amy E. Freilich
DEVELOPER:
Standard Pacific Corp., a Delaware corporation
By:
Name:______________________
Title: ______________________
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JOINDER OF ESCROW HOLDER
The undersigned is joining this Agreement to evidence its agreement to receive, hold and
disburse the Purchase Price Deposit in accordance with the terms of this Agreement and
otherwise to comply with the escrow instructions set forth in this Agreement.
FIRST AMERICAN TITLE INSURANCE
COMPANY
By:
Name:
Title:
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LIST OF ATTACHMENTS
ATTACHMENT 1GLOSSARY OF DEFINED TERMS
ATTACHMENT 2LEGAL DESCRIPTION OF DEVELOPMENT PARCELS
ATTACHMENT 3SITE PLAN (TENTATIVETRACT MAP)
ATTACHMENT 4PRELIMINARY TITLE REPORT
ATTACHMENT 5CITY BENEFITED PROPERTY
ATTACHMENT 6CITY ESTOPPEL
ATTACHMENT 7APRE-CONVEYANCE SCHEDULE
ATTACHMENT 7BSCHEDULE OF PERFORMANCE
ATTACHMENT 8SCOPE OF DEVELOPMENTAND CONCEPT PLAN
ATTACHMENT 9HORIZONTAL IMPROVEMENTS
ATTACHMENT 10 LIST OF ENVIRONMENTAL REPORTS AND STATEMENTS
ATTACHMENT 11 QUITCLAIM DEED
ATTACHMENT 12MEMORANDUM OF DDA
ATTACHMENT 13PUBLIC ACCESS EASEMENT AREAS
ATTACHMENT 14PROFIT PARTICIPATION AGREEMENT
ATTACHMENT 15CERTIFICATE OF COMPLIANCE
ATTACHMENT 16AASSIGNMENT AND ASSUMPTION AGREEMENT (TO TRANSFEREE
OTHER THAN BUILDER TRANSFEREE)
ATTACHMENT 16BASSIGNMENT AND ASSUMPTION AGREEMENT(TO BUILDER
TRANSFEREE)
ATTACHMENT 17CITY DATE DOWN CERTIFICATE
ATTACHMENT 18DEVELOPER DATE DOWN CERTIFICATE
ATTACHMENT 19CITY BACKBONE IMPROVEMENTS
ATTACHMENT 20SPECIAL RESTRICTIONS
ATTACHMENT 21PORTION OF PARK AVENUE DEPICTION
ATTACHMENT 22LANDSCAPE MAINTENANCE AGREEMENT
ATTACHMENT23SOIL LICENSE AGREEMENT
ATTACHMENT 24TAX BURDEN SCHEDULE
ATTACHMENT 25REPURCHASE PRICE LOT VALUES
ATTACHMENT 26CFD LIQUIDATED DAMAGES CALCULATION
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Attachment 1
ATTACHMENT 1
GLOSSARY OF DEFINED TERMS
For purposes of this Agreement, the following capitalized terms shall have the following
meanings:
AccrueAccruing
“” or “” shall mean the transpiring of an act or occurrence or a failure to
act or occur pursuant to which a legally enforceable claim could be asserted by any Person.
Action
“” shall have the meaning set forth in Section 17.2.
Active Negligence
“” shall mean an affirmative act performed negligently and not a
failure to act.
AD/CFD
“” shall have the meaning set forth in Section 8.7.3.
Additional ALTA Coverage
“” shall have the meaning set forth in Section 6.4.
Additional Liability Period
“” shall mean (a) with respect to any Developer,for the
period of ownership of its Successor Owners unless Developer has been released with respect to
such obligations pursuant to Section 2.2.3(a)(iii); (b) with respect to Responsible Developers, for
the period of ownership of its Successor Owners acquiring pursuant to Permitted Transfer under
Sections 2.2.2(a), (b) and (c) with respect to Transfer by a Builder Transferor, for the additional
period of ownership of any Builder Transferee.
Agreement
“” shall mean this Tustin Legacy Disposition and Development Agreement
including all Attachments attached hereto.
ALTA Policy
“” shall mean an ALTA extended coverage owner’s and/or leasehold policy
of insurance as such term is used in Section6.2.
Approved Developer
“” shall mean the Initial Developerand/or any Transferee that has
been approved by the City in accordance with Section 2.2.3, but specifically excluding a Builder
Transfereeor anyTransferee pursuant to a Permitted Transfer under Section 2.2.2.
Approved Plans
“” shall have the meaning set forth in Section 8.4.7.
BaseClosure Law
“” shall have the meaning set forth in Section 1.1.1.
Base Purchase Price
“” shall have the meaning set forth in Section 4.2.1.
Basic Concept Plan
“”shall mean the submittals by Developer to the City for purposes of
satisfaction of the Concept Plan and Design Review approval and shall include the phasing and
proposed product mix, provided that Basic Concept Plan submittals shall be reviewed by the City
in its Proprietary Capacity (as opposed to the Concept Plan and Design Review submittals which
are reviewed by the City Development Department under the Governmental Capacity of the
City.)
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Bill of Sale
“”shall have the meaning set forth in Section 7.2.1(a).
Boundary Landscape Area
“” shall mean that certain property owned by the City
(i)adjacent to Jamboree Road, generally located between the sound wall for Jamboree Road and
the perimeter wallsof the Project,(ii) that front on a public street adjacent to the Development
Parcelsbetween the back of curb and such perimeter walls,as depicted on Exhibit “C”to
Attachment22and (iii) comprising the Entry Areas.
BRE
“” shall have the meaning set forth in Section 2.2.7.
“Builder Transferee
” shall have the meaning set forth in Section 2.2.3(b)(i).
Builder Transferor
“”shall have the meaning set forth inSection 14.2.6.
Building
“”shall mean each building and structure on the Development Parcels, including
where applicable, the Homes.
Business Day(s)
“” shall mean any day on which City Hall is open for business and shall
specifically exclude Fridays whenCity Hall is officially closed, Saturday, Sunday or a legal
holiday.
CC&Rs
“” shall have the meaning set forth in Section 13.1.
CEQA
“” shall mean the California Environmental Quality Act and implementing
regulations and guidelines, contained in Cal. Public Resources Code Section21000 et seq., and
Cal. Code of Regulations, Title 14, Section15000 et seq., respectively.
Certificate of Compliance
“” shall mean a certificate issued certifying completion of all
construction and development required to be undertaken by Developer in accordance with this
Agreement as described in Section 9.2.
CFD Default
“” shall have the meaning set forth in Section 16.7.
CFD Liquidated Damages
“” shall have the meaning set forth in Section 16.7.
Channel Improvements
“” shall mean the “Peters Canyon Channel Improvements” as
defined in Section 2.2 of that certain Joint Cooperative Agreement by and among the City,
OCFCD and The County of Orangedated March 11, 2003, as amended by Amendment No.1 to
Joint Cooperative Agreement dated June 8, 2004, but shall specifically exclude the design and
construction of the PetersCanyon Channel (F06), County’s Master Planned Regional Riding and
Hiking Trail.
Channel Condition Satisfaction Date
“”shallhave the meaning set forth in Section
8.10.3.
City
“” shall mean the City of Tustin and each assignee or successor to the City’s rights,
powers and responsibilities as described in Section 1.4.1.
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City Attorney
“” shall mean the individual appointed by the City Council as “City
Attorney.”
City Backbone Improvements
“” shall mean (a) those portions of Moffett Drive,
including the bridge extending Moffett Drive across theChannel Improvements, and Park
Avenue and any and all infrastructure and utilities associated with those streets,as further
described and depicted on Attachment 19and (b) the Channel Improvements.
City Benefited Property
“” shall mean the properties owned by the City and described
onAttachment 5.
City Closing Conditions
“” shall have the meaningset forth in Section 7.2.2.
City Code
“” shall mean the Tustin City Code for the City of Tustin, California, as the
same may be amended from time to time.
City Costs Deposit
“” shall have the meaning set forth in Section1.8.2.
City Council
“” shall mean the City Council of the City of Tustin which serves as the
City’s legislative body.
City Estoppel
“” shall mean an estoppel certificate substantially in the form and
substance of that attached hereto as Attachment6,to be executed and delivered by the City to a
Transferee or to a Successor Owner.
City Excluded Information
“” shall mean information that is (a) known by the City prior
to the disclosure thereof by Developer or its officers, employees, agents, attorneys, affiliates,
representatives, contractors, successors or assigns, (b) developed by or on behalf of the City
without the use of any confidential information provided by Developer or its officers, employees,
agents, attorneys, affiliates, representatives, contractors, successors or assigns, (c) disclosed to
the City by a third party other than Developer or any of its officers, employees, agents, attorneys,
affiliates, representatives or contractors, or (d) known to the public through no act or fault of the
City in violation of this Agreement.
“City Expense Cap”
shall have the meaning set forth in Section1.8.3.
City Hall
“” shall mean the seat of government for the City of Tustin, presently located at
300 Centennial Way, Tustin, California.
City Indemnified Parties
“” shall mean the City and its appointed and elected officials,
agents, attorneys, affiliates, employees, contractors, consultantsand representatives.
City Inspections
“” shall have the meaning set forth in Section 16.5.1.
City Lien
“” shall have the meaning set forth in Section 16.2.
City Manager
“” shall mean Mr. Jeffrey Parker, or his successor in such capacity, or
other designee as identified in writing by the City Manager.
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City Releasing Party
“”shall have the meaning set forth in Section 16.6.4.
City Representatives
“” shall have the meaning set forth in Section 3.3.
“City Repair Acknowledgement”
shall have the meaning set forth in Section 16.5.2.
City Reserved Claims
“” shall have the meaning set forth in Section 16.6.3.
City Reserved Rights
“” shall have the meaning set forth in Section 16.6.2.
City Transaction Expenses
“” shall have the meaning set forth in Section 1.8.2.
ClaimClaims
“” or “” shall mean any and all claims, actions, causes of action, demands,
orders, or other means of seeking or recovering losses, damages, liabilities, costs, expenses
(including attorneys’ fees, fees of expert witnesses, and consultants’ and court and litigation
costs), costs and expenses attributable to compliance with judicial and regulatory orders and
requirements, fines, penalties, liens, taxes, or any type ofcompensation whatsoever, direct or
indirect, known or unknown, foreseen or unforeseen.
Close of EscrowClosing
“” or “” shall mean the close of escrow for the Property and the
transfer of fee title to the Property by the City to Developer pursuant to the Quitclaim Deed, and
execution and recordation (to the extent that such Other Agreements are to be recorded pursuant
to the terms of Section 7.4.6(b)) of the Other Agreements and additional documents associated
therewith, as more fully set forth in Section 7,which shall take place on the Closing Date.
Closing Conditions
“” shall mean the Developer Closing Conditions and the City Closing
Conditions.
Closing Date
“” shall have the meaning set forth in Section 7.1.1.
Common Area Improvements
“” shall mean the ParkFacilities, Greenbelt Park Areas,
Private Streets and Sidewalks, Buildings, structures and improvements, including clubhouses,
child yards, parking lots, swimming pools, LandscapingImprovements, roadways, drives, bike
paths, alleyways, sidewalks, utilities, landscaping, hardscaping, fountains and other
infrastructure and other amenities of the Project to be available for and used in common by the
owners of Homes on the Development Parcelsas approved in the Approved Plans.
Common Areas
“” shall mean land proposed to be owned by the Homebuyers in
common pursuant to the CC&Rs, upon which land the Common Area Improvements are
proposed to be located
.
CompleteCompletion
“” and “”shall mean: (a) with respect to the Project or the point in
time when all of the following shall have occurred with respect to the Project: (1) the
Improvements with respect thereto have been completed in accordance with this Agreement; (2)
the issuance of a permanent certificate of occupancy by the City or, to the extent a certificateof
occupancy is not required by the City for a particular Improvement, the equivalent final
inspection, signoff or other permit activity with respect to such Improvement, (3) the Recording
of a Notice of Completion pursuant to California Civil Code Section 3043 by Developer, its
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Successor Owner or such Party’s contractor with respect to private Improvements, but not public
Improvements; and (4)any mechanic’s liens that have been recorded or stop notices that have
been delivered have been paid, settled or otherwise extinguished, discharged, released, waived,
bonded around or insured against and (b) with respect to a particular Improvement, (1) the
Improvement has been completed in accordance with this Agreement; and (2) the issuance of a
permanent certificate of occupancy by the City or, to the extent a certificate of occupancy is not
required by the City for a particular Improvement, the equivalent final inspection, signoff or
other permit activity with respect to such Improvement.
Concept Plan and Design Review
“” shall mean collectively the concept plan review
required by the Specific Plan and the site plan and design review approvals as required by the
City Code, which shall be part of the Entitlements.
Conditions Precedent
“” shall mean the conditions precedent to issuance of the
Certificate of Compliance set forth in Section 9.3.
ControlControlledControlling
“” “” or “”, as used with respect to any Person, shall
mean the possession, directly or indirectly (including through one or more intermediaries), of the
power to direct or cause the direction of the management and policies of such Person, including
through the ownership or control of voting securities, partnership interests, membership interests,
or other equity interests, acting as the manager of a limited liability company, or otherwise.
Controlling Person
“” shall mean (a) any Person who Controls Developer and (b) any
Person who Controls a Controlling Person.
Costs
“” shall have the meaning set forth in Section 17.2.
Counsel
“” shall have the meaningset forth in Section 10.8.
DA
“”shall have the meaning set forth in Section 1.6.
Decision
“” shall have the meaning set forth in Section 17.2.
Default
“” shall mean a Potential Default and/or Material Default, as the context
requires.
Default Notice
“” shall have the meaning set forth in Section 14.1.
Default Rate
“” shall mean an interest rate of eight percent (8%) per annum, compounded
annually, but in no event in excess of the maximum legal rate.
Defaulting Party
“” shall have the meaning set forth in Section 14.1.
Defect Notice
“” shall have the meaning set forth in Section 16.5.2.
Defending Party
“” shall have the meaning set forth in Section 10.8.
Defended Party
“” shall have the meaning set forth in Section 10.8.
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Developer
“” shall mean Standard Pacific Corp., as of the Effective Date of the
Agreement, or any Successor Owner following any Transfer pursuant to a Permitted Transfer or
any other Transfer approved by the City, as described in Sections 2.2.2and2.2.3.
Developer Affiliate
“” shall mean any Person that Controls, is Controlled by or is under
common Control with Standard Pacific Corp.
Developer Closing Conditions
“” shall have the meaning set forth in Section7.2.1.
Developer Closing Payment
“” shall have the meaning set forth in Section4.3.3.
Developer Excluded Information
“” shall mean information that is (a) known by
Developer prior to the disclosure thereof by the City or its elected and appointed officials,
employees, agents, attorneys, affiliates, representatives, contractors, successors or assigns,(b)
developed by or on behalf of Developer without the use of any confidential information provided
by the City or its officers, employees, agents, attorneys, affiliates, representatives, contractors,
successors or assigns, (c) disclosed to Developer by athird party other than the City or any of its
elected and appointed officials, employees, agents, attorneys, affiliates, representatives or
contractors, or (d) known to the public through no act or fault of Developer in violation of this
Agreement.
Developer Insolvency Event
“” shall have the meaning set forth in Section 2.2.5.
Developer Knowledge Parties
“” shall have the meaning set forth in Section 3.1.
Developer Released PartyDeveloper Released Parties
“” and “””shall have the
meaning set forth in Section 16.6.4.
Developer Representatives
“” shall have the meaning set forth in Section 5.4.
Developer Title Endorsements
“” shall have the meaning set forth in Section6.4.
Development Costs
“” shall have the meaning set forth in Section8.1.3.
Development Parcels
“” shall have the meanings set forth in Section1.2.1.
Development Permits
“” means all ministerial permits required by the City or any
Governmental Authority in connection with construction of the Project and shall include any
grading permit, foundation permit, construction permit, building permit or other permit type as
may be necessary pursuant to Chapter 4 of the Specific Plan and/or the City Code.
Diligence Termination Notice
“” shall have the meaning set forth in Section 5.1.
Disapproved Exception
“” shall have the meaning set forth in Section6.3.
DTSC
“” shall mean the California Department of Toxic and Substance Control.
Due Diligence Information
“” shall mean any and all information or documentation
relating to the Property furnished to Developer by the City, or its elected and appointed officials,
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employees, agents, attorneys, affiliates, representatives, contractors or consultants, in connection
with Developer’s due diligence pursuant to Section 5.1of this Agreement.
Due Diligence Period
“” shall have the meaning set forth in Section5.1.
EBS
“” shall have the meaning set forth in Section 4.5.1(b)(iii).
Effective Date
“” shall have the meaning set forth in the first paragraph of this
Agreement.
ENA
“” shall have the meaning set forth in Section 1.1.5.
ENA Deposit
“” shall have the meaning set forth in Section 1.8.1.
ENA Transaction Expenses
“” shall have the meaning set forth in Section 1.8.1.
“End User”
shall mean any (a) Homebuyer who purchases a Lot/Home, (b)
Homeowners’Association with respect to any Common Areas within the Property conveyed to the
Homeowners’Association,(c) utility or Governmental Authority with respect to any transfer of
portions of the Property or grants of easements affecting the Development Parcels desirable for the
development of the Development Parcelsand/or (d) any lighting or landscaping district.
Entitlements
“” shall mean all discretionary land use approvals and entitlements legally
required by the City or any other Governmental Authority as a condition of subdivision and
development of the Property and construction of Improvements and shall include any and all
entitlements, licenses, permits, tract maps or other approvals required by the City or any other
Governmental Authority as a condition to development of the Property and construction of the
Improvements, but excluding Development Permits, including those specific Entitlements
described in Section8.3.1.
Entry Areas
“” shall mean those portions of the City Property depicted on Exhibit “C”to
Attachment 22as “Entry Areas”.
Environmental Agency
“” shall mean the United States Environmental Protection
Agency; the California Environmental Protection Agency and all of its sub-entities, including
any Regional Water Quality Control Board, the State Water Resources Control Board, the
DTSC, the South Coast Air Quality Management District, and the California Air Resources
Board; the City; any Fire Department or Health Department with jurisdiction over the Property;
and/or any other federal, State, regional or local governmental agency or entity that has or asserts
jurisdiction over Hazardous Substance Releases or the presence, use, storage, transfer,
manufacture, licensing, reporting, permitting, analysis, disposal or treatment of Hazardous
Materials in, on, under, about, or affecting the Project.
Environmental Indemnity
“” shall mean the indemnity provided in favor of the City set
forth in Section 10.2.
Environmental Laws
“” shall mean any federal, state, regional or local laws, ordinances,
rules, regulations, requirements, orders, directives, guidelines, or permit conditions, in existence
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as of the Effective Date or as later enacted, promulgated, issued, modified or adopted, regulating
or relating to Hazardous Materials, and all applicable judicial, administrative and regulatory
decrees, judgments and orders and common law, including those relating to industrial hygiene,
public safety, human health, or protection of the environment, or the reporting, licensing,
permitting, use, presence, transfer, treatment, analysis, generation, manufacture, storage,
discharge, Release, disposal, transportation, Investigation or Remediation of Hazardous
Materials. Environmental Laws shall include the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, as amended (42 U.S.C. Section9601, et seq.)
CERCLA
(“”); the Resource Conservation and Recovery Act, as amended, (42 U.S.C.
RCRA
Section6901 et seq.) (“”); the federal Water Pollution Control Act, as amended,
(33U.S.C. Section1251 et seq.); the Toxic Substances Control Act, as amended, (15 U.S.C.
Section2601 et seq.); the Hazardous Substances Account Act (Chapter6.8 of the California
Health and Safety Code Section25300 et seq.); Chapter 6.5 commencing with Section25100
(Hazardous Waste Control) and Chapter6.7 commencing with Section25280 (Underground
Storage of Hazardous Substances) of the California Health and Safety Code; and the California
Water Code, Sections13000 et seq.
Environmental Matters
“”shall mean (a) the environmental condition of the Property;
(b)the compliance of the Propertywith Environmental Laws; (c)the existence, Release,
threatened Release, presence, storage, treatment, transportation or disposal of any Hazardous
Materials at any time on, in, under, or from, the Propertyor any current or future improvement
thereon or any portion thereof, and/or (d)Claims of or acts or omission to act of any
Governmental Authority or any other third party arising from or related to any actual, threatened,
or suspected Release of a Hazardous Material on, in, under, or from, about, or adjacent to the
Propertyor any current or future improvement thereon, including any Investigation or
Remediation at or about the Propertyor any current or future improvement thereon; provided
that in each case in which the property in question is the Returned Property, the foregoing shall
apply as to the Returned Property only.
Escrow
“” shall have the meaning set forth in Section4.4.
Escrow Holder
“” shall mean First American Title Insurance Company.
Federal Deed
“” shall mean that certain Quitclaim Deed H and Environmental Restriction
Pursuant to Civil Code Section 1471 dated May 13, 2002, that was Recorded on May 14, 2002 as
Instrument Number 20020404598.
Federal Government
“” shall meanthe United States of America (including the Navy),
by and through the Secretary of the Navy, or designee.
Final EIS/EIR
“”shall have the meaning set forth in Section1.1.2.
“Final Map”
shall mean a Final Map for the Property substantially in the form and
content required by the approved Tentative Tract Map.
Finally Approved
“”shall mean, with respect to each CFD or assessment district
described by this Agreement, thatthe City Council or Tustin Unified School District, as
applicable, has approved the formation of such CFD or assessment district, that the property
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owners having a vote shall have voted to approve such formation and all applicable appeal and
statute of limitations periods relating thereto shall have expired without the filing of any appeal
or legal challenge or any such appeal or legal challenge shall have been resolved in a manner that
permits formation of each in a manner acceptable to the City in its sole discretion.
Financing Plan
“” shall have the meaning set forth in Section 4.6.1.
FIRPTAAffidavit
“” shall mean an affidavit in form reasonably satisfactory to
Developer certifying that the City is not a “foreign person” under the federal Foreign Investment
in Real Property Act.
First Amendment to ENA
“” shall have the meaning set forth in Section 1.1.5.
First Party
“” shall have the meaning set forth in Section 17.7.3.
Force Majeure Delay
“” shall have the meaning set forth in Section 17.7.1as limited by
Section 17.7.2.
FOST
“” shall mean the Department of Navy findings and determinations that the
Development Parcels were suitable for transfer to the City, pursuant to the document entitled
“Final Finding of Suitability to Transfer For Southern Parcels 4-8, 10-12, 14, and 42, and Parcels
25, 26, 30-33, 37, and Portions of 40 and 41 Marine Corps AirStation Tustin, California,” dated
September 28, 2001.
General Plan
“” shall mean the most current general plan for the City of Tustin.
Governmental Authorityand Governmental Authorities
“”“”shall mean, respectively,
each and all federal, State, county, municipal and local governmental and quasi-governmental
bodies and authorities (including the United States of America, the Stateand any political
subdivision, public corporation, district, joint powers authority or other political or public entity)
or departments thereof having or exercising jurisdiction over the Parties, the Project, the Property
or such portions of the foregoing as the context indicates.
Governmental Capacity
“” shall have the meaning set forth in Section 17.25.
Governmental Requirements
“” shall mean all laws, statutes, codes, ordinances, rules,
regulations, standards, guidelines and other requirements issued by any Governmental Authority
having jurisdiction over, governing, applying to or other affecting the Parties, the Project, the
Improvements, the Property or any component thereof and including the City Code, the Specific
Plan, the Entitlements, the Development Permits and the Approved Plans.
Grading Work
“” shall mean all of the grading work required to be completed by
Developer under the terms of this Agreement and any subdivision improvement agreement
entered into in connection with the Tentative Tract Map, which shall include rough grading of
the Development Parcels, including grading of all internal streets, access points, open space
areas, the LandscapeArea, the Common Areas and the Boundary Landscape Area and blue-
topping of all Lots and development pads within the Development Parcels, as further depictedon
Attachment9.
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Greenbelt Park Areas
“” means the approximately 3.73acresof greenbelts required to
be constructed or installed by Developer on the Development Parcels generally in the location
depicted inAttachment 13.
Hazardous Materials
“” shall mean and include the following:
Hazardous SubstanceHazardous MaterialHazardous Waste
(a)“”, “”, “”,
Toxic Substance
or “” under the Comprehensive Environmental Response, Compensation and
Liability Act of 1980, 42 U.S.C. subsection9601, et seq., the Hazardous Materials
Transportation Act, 49 U.S.C. subsection5101, et seq., or the Resource Conservation and
Recovery Act, 42 U.S.C. subsection6901, et seq.;
Extremely Hazardous WasteHazardous Waste
(b)An “”, a “”, or a
Restricted Hazardous Waste
“”, under subsections25115, 25117, or 25122.7 of the California
Health and Safety Code, or is listedor identified pursuant to subsection25140 or 44321 of the
California Health and Safety Code;
Hazardous MaterialHazardous SubstanceHazardous Waste
(c)“”, “”, “”,
Toxic Air ContaminantMedical Waste
“”, or “” under subsections25281, 25316, 25501,
25501.1, 117690 or 39655 of the California Health and Safety Code;
OilHazardous Substance
(d)“” or a “” listed or identified pursuant to
Section311 of the Federal Water Pollution Control Act, 33 U.S.C. Section1321, as well as any
other hydro carbonic substance or by-product;
Hazardous WasteExtremely Hazardous
(e)Listed or defined as a “”, “
WasteAcutely Hazardous Waste
”, or an “” pursuant to Chapter 11 of Title 22 of the California
Code of Regulations;
(f)Listed by the Stateas a chemical known by the State to cause cancer or
reproductive toxicity pursuant to Section25249.8of the CaliforniaHealth and Safety Code;
(g)A material which due to its characteristics or interaction with one or more
other substances, chemical compounds, or mixtures damages or threatens to damage, health,
safety, or the environment, or is required by anylaw or public agency to be remediated,
including remediation which such law or public agency requires in order for the property to be
put to any lawful purpose;
(h)Any material whose presence would require remediation pursuant to the
guidelines set forth in the StateLeaking Underground Fuel Tank Field Manual, whether or not
the presence of such material resulted from a leaking underground fuel tank;
(i)Pesticides regulated under the Feral Insecticide, Fungicide and
Rodenticide Act, 7 U.S.C. subsection136 et seq.;
(j)Asbestos, PCBs and other substances regulated under the Toxic
Substances Control Act, 15 U.S.C. subsection2601 et seq.;
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(k)Any radioactive material including any “source material”, “special nuclear
material”, “by-product material”, “low-level wastes”, “high-level radioactive waste”, “spent
nuclear fuel” or “transuranic waste”, and any other radioactive materials or radioactive wastes,
however produced, regulated under the Atomic Energy Act, 42U.S.C. subsection2011 et seq.,
the Nuclear Waste Policy Act, 42 U.S.C. subsection10101 etseq., or pursuant to the California
Radiation Control Law, California Health and Safety Code Section114960 et seq.;
(l)Regulated under the Occupational Safety and Health Act, 29U.S.C.
subsection651 et seq., or the California Occupational Safety and Health Act, California Labor
Code subsection6300 et seq.; and/or
(m)Regulated under the Clean Air Act, 42 U.S.C. subsection7401 etseq. or
pursuant to Division 26 of the California Health and Safety Code.
High Quality Residential Project
“” shall mean a neighborhood of single-family homes
that is of high quality and very well maintained and managed, in each case comparable to other
high quality single family developments in the City of Tustin and the City of Irvine of similar
age.
High Quality Residential Standards
“” shall mean, in terms of the quality of
maintenance, standards consistent with a High Quality Residential Project.
HomeHomes
“” or “” shall mean eachsingle family home and related improvements that
are to be developed on each Lot, as contemplated by the Scope of Development.
Homebuyer
“” shall mean a person or persons who will own in fee and occupy, for
residential purposes, an individual Home.
Homeowners’ Association
“” shall have the meaning set forth in Section 2.2.7.
Horizontal Improvements
“” shall mean (a) the Grading Work, (b) all local on-site
infrastructure improvements and utilities and utility systems required to be constructed or
installed on or in connection with the development of the Property including (i)all roadways,
drives, alleyways, sidewalks and parking lots within the Property and alltraffic and circulation
mitigation to support the Project;(ii)all utilities and utility systems required for the Project to the
boundary of each Lot, including domestic and reclaimed water; sewer; telemetry; utilities
(electricity, gas, telephone,cable, telecommunications, etc.) and other infrastructure normally
required to service a new, High Quality Residential Project, (c) the Common Area Improvements
and (d) the Landscape Improvements, all as further described and depicted on Attachment 8and
Attachment 9, butHorizontalImprovementsshall exclude the On-Lot Improvements.
Horizontal Improvement Costs
“” shall mean all of the following:
(a)Site Improvement and Entitlement. Improvement costs (hard costs)
actually expended for the Horizontal Improvements constructed in accordance with City
standards and accepted by the City, including, but not limited to, for engineering, consultants,
bonds, grading, wet utilities, dry utilities, street improvements, walls and fences, landscaping,
and common area and recreational facilities, and all costs to obtain, alter or amend any
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entitlements for the Project or to record the Final Map, and reasonable costs for the foregoing to
the extent contracted for by Developer with any Developer Affiliate.
(b)Indirect Construction. Reasonable indirect construction costs actually
expended for Horizontal Improvements, including, but not limited to, permits and fees,
architecture, engineering, inspections, on-site construction supervision, construction trailer,
security, repairand replacement, and other site costs associated with the construction of the
Horizontal Improvements.
(c)Direct Construction. The actual costs of construction materials,
equipment rental, labor and subcontractors for the construction of the Horizontal Improvements.
(d)Insurance. An agreed amount equal to one half of onepercent (.50) ofthe
total costs set forth in subsections (a) through (c) of this definition of Horizontal Improvement
Costs to compensate Developer for insurance costs related to the Horizontal Improvements.
(e)Other Allocable Costs. Any other actual costs properly and directly
allocable specifically to the development, construction,maintenance and/orrepair of the
Horizontal Improvements.
Improvements
“” shall have the meaning set forth in Section 1.3.2.
Initial Channel Condition
“” shall have the meaning set forth in Section 8.10.3.
Initial Developer”
“shallhave the meaning set forth in Section 2.1.
Injured Party
“” shall have the meaning set forth in Section 14.1.
Intangible Property
“” shallmean all rights, claims (other than claims under insurance
policies maintained by or for the benefit of the City) and all permits, licenses, approvals and
authorizations issued by any Governmental Authorities in connection with the Development
Parcels; but with respect to the Navy Responsibilities shall be a non-exclusive assignment of
rights and shall not be deemed an assignment or release by the City of its rights against any
responsible party or against the Federal Government or any third party with respect to the Navy
Responsibilities.
Investigation(s)
“” shall mean any observation, inquiry, examination, sampling,
monitoring, analysis, exploration, research, inspection, canvassing, questioning, and/or surveying
of or concerning the Property, includingthe air, soil, surface water, and groundwater, and the
surrounding population or properties, or any of them, to characterize or evaluate the nature,
extent or impact of Hazardous Materials.
Inventory Commitment
“” shall have the meaning set forth in Section 8.9.2.
IRWD
“” shall mean the Irvine Ranch Water District.
Key Employees
“” shall mean the following employees of Developer: Edward T.
McKibbin, Michael Battaglia and Gary Jones.
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Landscape Area
“” shall mean (a) the Park, (b) the Greenbelt Park Areas,(c)theportions
of the Common Area identified as landscape areas on Exhibit “A” to the Scope of Development,
and (d)the “Landscape Area” as defined in the Landscape Maintenance Agreement attached as
Attachment 22.
“Landscape Improvements
”shall mean any and all landscaping, irrigation and/or
hardscape improvements required by the Approved Plans to be constructed in connection with
the Project upon the Landscape Area.
“Landscape Maintenance Agreement”
shall have the meaning set forth in Section
12.8.1.
Lien Release Amounts
“” shall mean the amounts, if any, (a) of any City Lien and (b)
required to be paid to third parties by the City to clear all monetary liens (including all
mechanics’ liens) and Mortgages that encumber the Property on the date of a Reversion Event or
the date of the close of escrow pursuant to the Right of Purchase and which, with respect to taxes
and assessments, are then due and payable.
Lot(s)
“” shall mean the subdivided portions of the Development Parcels that are (a)
entitled to be improved with a Home or Homes as reflected in an approved and recorded Final
Map and (b) are intended for sale to individual Homebuyers.
Lump Sum Payment
“” shall have the meaning set forth in Section 8.7.2(b).
Material Default
“” shall have the meaning set forth in Sections 14.2.1and 14.2.2.
MCAS Tustin
“” shall have the meaning set forth in Section 1.1.1.
Memorandum of Agreement
“” shall have the meaning set forth in Section 1.1.3.
Memorandum of DDA
“” shall mean a memorandum of record of this Agreement
recorded against the Property substantially in the form and substance of the memorandum
attached to the Agreement as Attachment12.
Models”
“shall mean the twelve (12)model Homes, comprised of three (3)model Homes
for each product type, to be constructed by Developer on the Development Parcels in the
location shown on Attachment 3.
Mortgage
“” shall mean any indenture of mortgage or deed of trust, bond, grant of
taxable or tax exempt funds from a governmental agency or other security interest affecting the
Development Parcels or any portion thereof and the documents governing a sale-leaseback
transaction, together with all loan documents related thereto, but excluding any community
facilities districts, assessment districts, landscape and lighting districts, Homeowners’
Association dues or other assessments created or imposed by any Governmental Authority.
Mortgagee
“” shall mean any mortgagee, beneficiary (or any agent for one or more
lenders acting in such capacity) under any indenture of mortgage, deed of trust, trustee of bonds,
governmental agency which is a grantor of funds, and, with respect to the Property or any portion
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thereof which is the subject of a sale-leaseback transaction, the Person acquiring fee title.
Navy
“” shall mean the United States Department of Navy.
Navy Responsibilities
“” shall have the meaning set forth in Section 4.5.2(c).
Notice of Completion
“” shall mean the notice of completion filed by Developer after the
Completion of each Improvement, pursuant to California Civil Code Section8182.
Notice to Builder Transferor
“” shallhave the meaning set forth in Section 14.2.6.
OCFCD
“”shall mean the Orange County Flood Control District.
On-Lot Improvements
“” shall mean dry and wet utility extensions, sidewalks and
drives, walls, fences and landscapingfrom the back of curb to and including each Lot, and shall
include capped paving on streets, drivesand alleys adjacent to such Lots.
Opening of Escrow
“” shall have the meaning set forth in Section4.4.
Original ALTA Coverage
“” shall have the meaning set forth in Section 6.4.
Original ENA
“” shall have the meaning set forth in Section 1.1.5.
Other Agreements
“” shall mean the Quitclaim Deed, the Special Restrictions, the
Memorandum of DDA, the DA, the Soil License Agreement,the Landscape Maintenance
Agreement and Profit Participation Agreement.
Outside Closing Date
“” shall have the meaning set forth in Section 7.1.1.
Park
“” shall mean a6.1 acre focal park as depicted inAttachment 13.
Park Facilities
“” shall meanthe Park and all related Improvements, including
Landscaping Improvements.
Party
“”shall mean either of the City or Developer, individually, as parties to this
Agreement.
Parties
“” shall mean the City and Developer, collectively.
Performance Bonds
“” shall mean the bonds issued by a surety company admitted in the
Stateand regulated by the StateDepartment of Insurance, Best's Rated "A" and otherwise
acceptable to the City Manager and City Attorney in their sole discretion, in which the City is a
named obligee. The Performance Bonds shall guarantee payment for and faithful performance
and Completion within the respective times provided in this Agreement of the Horizontal
Improvements in accordance with drawings or plans, as appropriate, that specifically describe the
work to be performed in sufficient detail for the issuance of such Performance Bonds.
Permitted Exceptions
“” shall have the meaning set forth in Section6.2as may be
modified by Section 6.3.
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Permitted Transfer
“” shall have the meaning set forth in Section 2.2.2.
Person
“” shall mean an individual, partnership, limited partnership, trust, estate,
association, corporation, limited liability company, joint venture, firm, joint stock company,
unincorporated association, Governmental Authority, governmental agency or other entity,
domestic or foreign.
Potential Default
“” shall have the meaning set forth in Section 14.1.
Potential Returned Property
“”shall mean those portions of the Property which are
eligible for repurchase under Section 16.3 due to occurrence of a Repurchase Default or
revesting under Section 16.4 due to occurrence of a Reversion Action Trigger, as applicable.
Pre-Closing Schedule
“” shall mean schedule attached as Attachment7Ato this
Agreement, setting forth the dates and time periods for submissions, approvals and actionsin the
period prior to the Close of Escrow.
Preliminary Title Reports
“” shall have the meaning set forth in Section6.2.
Prevailing Party
“” shall have the meaning set forth in Section 17.2.
Private Streets and Sidewalks
“” shallmean those private streets, roadways,sidewalks,
pedestrian pathways, and bike ways within the Development Parcels depicted on Exhibit “A” to
the Scope of Development to which public access shall be provided.
Products
“” shall have the meaning set forth in Section 14.3.2.
Profit Participation Agreement
“” shall havethe meaning set forth in Section 4.2.2.
ProfitParticipation Price
“”shall have the meaning set forth in Section 4.2.2.
Project
“” shall have the meaning set forth in Section1.3.2.
Project Architect
“” shall mean William Hezmalhalch Associates or Bassenian Lagoni
Architects.
Project Budget Statement
“” shall mean a document delivered by Developer to the City
which shows, as of the end of the immediately preceding quarter, (a) the fees paid through the
end of such prior quarter and estimated fees to be paid prior to Completion of the Project in
connection with the development and construction of the Project, and (b) out-of-pocket costs
spent through the end of such prior quarter and estimated out-of-pocket costs to bepaid prior to
Completion of the Project, in each case for each of the major categories of hard and soft costs for
the development and construction of the Project.
Project Fair Share Contribution
“” shall have the meaning set forth in Section8.7.2.
Property
“” shall have the meaning set forth in Section4.1.
Proprietary Capacity
“” shall have the meaning set forth in Section 17.25.
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Public Records Act
“” shall have the meaning set forth in Section 17.24.1.
Purchase Price
“” shall mean the Base Purchase Price and the ProfitParticipation Price,
collectively.
Purchase Price Deposit
“” shall be an earnest money deposit delivered by Developer to
the City upon execution of the Agreement as described in Section4.3.1.
Quimby Fees
“” shall mean the fees payable by Developer to City in order to achieve
compliance with the Quimby Act, as further described in California Government Code §66477.
Quitclaim Deed
“” shall mean the quitclaim deed to be executed and delivered by the
City at the Close of Escrow to quitclaim all ofthe City’s interests in the Property (subject to
Section4.1and the terms of this Agreement) to Developer. The Quitclaim Deed shall be in
substantially the form and substance of the deed attached hereto as Attachment 11,
acknowledged and in Recordable form.
Reacquired Property
“” shall have the meaning set forth in Section 16.4.1with respect
to a City election to revest all or any portion of the Property pursuant to the Right of Reversion.
RecordRecordationRecordingRecorded
“”, “”, “” and “” shall mean to record the
specified instrument, or the current or past recording of the specified instrument, in the official
records of Orange County California.
Recordable
“” shall mean with respect to any document, that such document has been
acknowledged and is otherwise in a form that would permit the Recordation thereof.
Release
“” (with respect to Hazardous Materials) shall mean any releasing, or threat of
releasing, spilling, leaking, pumping, pouring, emitting, emptying, discharging, injecting,
escaping, leaching, migrating, disposing, or dumping into the environment.
Released PartyReleased Parties
“”and “” shall have the meanings set forth in
Section4.5.2(f).
Releasing Party
“”shall have the meaning set forth in Section4.5.2(f).
RemediateRemediation
“” or“” shall mean any response or remedial action as defined
under Section101(25) of CERCLA, and similar actions with respect to Hazardous Materials as
defined under comparable state and local laws, and any other cleanup, removal, containment,
abatement, recycling, transfer, monitoring, storage, treatment, disposal, closure, restoration or
other mitigation or remediation of Hazardous Materials or Releases required by any
Environmental Agency or within the purview of any Environmental Laws.
Repurchase Default
“” shall have the meaning set forth in Section 16.3.
Repurchase Price
“” shall meanan amount equal to (a)(i) the value ascribed to each Lot
comprising the RepurchasedPropertyor Reacquired Property, as applicable,by product type,set
forth inonAttachment 25plus (ii) the Horizontal Improvement Costs(including on all lettered lots
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or Common Areas), divided by the total number of Lots within the Property as shown on the Final
Map, multiplied by the number of Lots within the Repurchased Property or the Reacquired
Property, as applicable, plus (iii) the Vertical Improvement Costs incurred by Developer with
respect to each Lot comprising the RepurchasedProperty or ReacquiredProperty, as applicable,
minus the Vertical Improvement Costs associated with those Vertical Improvements on the
Repurchased Property or Reacquired Property, as applicable, that in the reasonable discretion of
City’s building inspector, are either unusable or are in a state of major disrepairorrequire
demolition, and (b) with respect to any lettered lot or Common Areas shown on the Final Map, the
sum of zero ($0)shallbe attributed to the land value.
Repurchased Property
“” shall have the meaning set forth in Section 16.3.
Responsible Developer
“” meansthe Initial Developer, or if Initial Developer has been
previously released pursuant to Section 2.2.3(a)(iii), the then Approved Developer.
Returned Property
“” shall have the meaning set forth in Section 16.6.1.
Reuse Plan
“” shall have the meaning set forth in Section1.1.1.
Reversion ActionTrigger
“” shall have the meaning set forth in Section 16.4.1.
Reversion Action Trigger Date
“” shall have the meaning set forth in Section 16.4.1.
Reversion Event
“” shall have the meaning set forth in Section 16.4.
RFP
“” shall have the meaning set forth in Section1.1.5.
Right of Purchase
“” shall have the meaning set forth in Section 16.3.
Right of Reversion
“” shall have the meaning set forth in Section 16.4.
Schedule of Performance
“” shall mean Schedule of Performance attached as
Attachment7Bto thisAgreement,setting forth the dates and time periods for submissions,
approvals and actions, including the construction of the Improvements.
Scope of Development
“” shall mean the description of the Project attached as
Attachment8to the Agreement.
Second Party
“”shall have the meaning set forth in Section 17.7.3.
Site Plan
“” shall have the meaning set forth in Section 8.4.3.
Soil License Agreement
“” shall have the meaning set forth in Section 7.2.1(a)(vii).
Special Restrictions
“” shall mean the Declaration of Special Restrictions for Disposition
Parcels 1B &6A, substantially in the form and substance of the document attached hereto as
Attachment 20, to be executed by the City and acknowledged in Recordable form and Recorded
at the Close of Escrow immediately prior to the Recording of the Quitclaim Deed.
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Specific Plan
“” shall mean the MCAS Tustin Specific Plan/Reuse Plan as the same has
been or shall be amended from time to time.
State
“” shall mean the State of California.
Subdivision Improvement Agreement
“” shallmean any subdivision improvement
agreement entered into in connection with the Tentative Tract Map.
Subdivision Map Act
“” shall mean the laws of the State governing subdivision of lots,
codified at Government Code Section 66410 etseq.
Successor Owner
“”shall mean (a) with respect to the Property, each and every Person
owning or acquiring fee title to all or any portion of the Property and (b) with respect to the City
BenefitedProperty, each and every Person owning or acquiring fee title to all or any portion of
the City BenefitedProperty.
Supplemental Title Report
“” shall have the meaning set forth in Section6.3.
Survey
“” shall have the meaning set forth in Section6.1.
Surveyor
“” shall have the meaning set forth in Section6.1.
Takedown
“” shall have the meaning set forth in Section 2.2.3(b)(ii).
TakedownRestrictions
“” shall have the meaning set forth in Section 2.2.3(b)(ii).
Tax A
“” shall have the meaning set forth in Section 8.7.3(a)(i).
Tax B
“” shall have the meaning set forth in Section 8.7.3(a)(ii).
Tentative Tract Map
“” shall mean Tentative Tract Map 17507approved by the City in
accordance with the Subdivision Map Act and the City Code.
Title Company
“” shall mean First American Title Insurance Company.
Transfer
“” shall mean (a) the transfer, sale, assignment, lease, license, entry into a
property management agreement, gift, hypothecation, mortgage, pledge or encumbrance, or other
similar conveyance by Developer of Developer’s interests in this Agreement, all or any portion
of the Property, the Improvements thereon, or any portion thereof or interest therein, whether
voluntary, involuntary, by operation of law or otherwise, or any agreement to do so; and (b) the
granting by Developer of any Mortgage, easement, license, lien or other encumbrance and/or the
execution of any installment land sale contract or similar instrument affecting all or a portion of
the Property, the Improvements thereon, or any portion thereof or interest, or any conversion of
Developer to an entity form other than that of Developer at the time of execution of this
Agreement.
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Transfer of Control
“” shall mean, with respect to Developer or Developer’s Controlling
Person, the occurrence, directly or indirectly, in a single transaction or a series of transactions, of
any of the following:
(a)the conveyance, sale, assignment, transfer or disposition of all or substantially all
of that Person’s (or its Controlling Person’s) assets, stock, membership or partnership interests or
other equity interests;
(b)the dissolution, merger, reorganization, share exchange, recapitalization,
restructuring or consolidation of that Person (or its Controlling Person), other than a transaction
that would result in all of the voting securities of that Person (or its Controlling Person)
outstanding immediately prior thereto to continue to represent (either by remaining outstanding
or by being converted into voting securities of the surviving entity) at least 50.01% of the
combined voting power of all of the voting securities of that Person (or its Controlling Person) or
such surviving entity outstanding immediately after such transaction; and
(c)the acquisition by any “Person” or “Group” (within the meaning of Sections 13(d)
and 14(d)(2) of the Securities Exchange Act of 1934) of an aggregate of 50.01% or more of the
beneficial ownership (within the meaning of Rule 13d-3 of the Securities Exchange Act of 1934)
of the issued and outstanding voting securities or other equity interests of that Person (or its
Controlling Person), where such acquiring “Person”or “Group” did not directly or indirectly (or
through an affiliate) already Control or own at least 50.01% of the voting securities or other
equity interests of such Person (or its Controlling Person).
Transferable Products
“” shall have the meaning set forth in Section 14.3.2.
Transferee
“” shall mean any Person to which a Transfer is made, including any
Successor Owner or Mortgagee, but excluding each and every Homebuyer of a Home.
Transferred Property
“”shall have the meaning set forth in Section 14.2.6.
TUSD CFD
“” shall have the meaning set forth in Section 7.2.2(g).
Tustin Legacy
“” shall have the meaning set forth in Section1.1.3.
Tustin Legacy Backbone Infrastructure Program
“” shall have the meaning set forth in
Section8.7.1.
Vertical Improvement Costs
“”shall mean all of the following:
(a)Indirect Construction. Indirect construction costs actually expended for On Lot
Improvements and Vertical Improvements, including, but not limited to, permits and fees,
architecture, engineering, consultants, bonds, inspections, on-site construction supervision,
construction trailer, security, repair and replacement, and other site costs associated with the
construction of the On Lot Improvements and Vertical Improvements.
(b)Direct Construction. The actual costsof construction materials, equipment rental,
labor and subcontractors for the construction of the On Lot Improvements and Vertical
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Improvements.
(c)Insurance. An agreed amount equal to two percent (2%) of the total costs set
forth in subsections (a) and(b) of this definition of Horizontal Improvement Costs to compensate
Developer for insurance costs related to the On Lot Improvements and Vertical Improvements.
(d)Other Allocable Costs. Any other actual costs properly and directly allocable
specifically to the development, construction, maintenance and/or repair of the On Lot
Improvements and Vertical Improvements.
Vertical Improvements
“” shall mean all of the buildings, structures, landscaping and
other improvements, other than the Horizontal Improvementsand the On-Lot Improvements, to
be constructed or installed on the Property, consistent with the Specific Plan, the Reuse Plan, the
Approved Plans, the Entitlements and the Development Permits.
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Attachment 2
Attachment 3
Attachment 4
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khrs `kk khdmr+ cdedbsr+ `mc dmbtlaq`mbdr `eedbshmf shskd sn sgd k`mc-
Sghr qdonqs '`mc `mx rtookdldmsr nq `ldmcldmsr gdqdsn( hr hrrtdcx ne shskd
hmrtq`mbd `mc mn kh`ahkhsx hr `rrtldc gdqdax- He hs hr cdrhqdc shskd hmrtq`mbd+ `
Ahmcdq nq Bnllhsldms rgntkc ad qdptdrsdc-
Ehqrs @ldqhb`m Shskd
Nqcdq Mtladq9 MGRB,3032/15 'sb(
O`fd Mtladq9 1
C`sdc `r ne Cdbdladq 07+ 1/02`s 692/ @-L-
Sgd enql ne Onkhbx ne shskd hmrtq`mbd bnmsdlok`sdc ax sghr qdonqs hr9
Rtachuhrhnm Ft`q`msdd
@ rodbhehb qdptdrs rgntkc ad l`cd he `mnsgdq enql nq `cchshnm`k bnudq`fd hr cdrhqdc-
Shskd sn r`hc drs`sd nq hmsdqdrs `s sgd c`sd gdqdne hr udrsdc hm9
Sgd Bhsx ne Strshm+ B`khenqmh`+ ` ltmhbho`k bnqonq`shnm
Sgd drs`sd nq hmsdqdrs hm sgd k`mc gdqdhm`esdq cdrbqhadc nq qdedqqdc sn bnudqdc ax sghr Qdonqs hr9
@ edd-
Sgd K`mc qdedqqdc sn gdqdhm hr cdrbqhadc `r enkknvr9
'Rdd `ss`bgdc Kdf`k Cdrbqhoshnm(
@s sgd c`sd gdqdne dwbdoshnmr sn bnudq`fd hm `cchshnm sn sgd oqhmsdc Dwbdoshnmr `mc Dwbktrhnmr hm r`hc
onkhbx enql vntkc ad `r enkknvr9
0- Hmsdmshnm`kkx Cdkdsdc
1- Fdmdq`k `mc rodbh`k s`wdr `mc `rrdrrldmsr enq sgd ehrb`k xd`q
2- Sgd khdm ne rtookdldms`k s`wdr+ he `mx+ `rrdrrdc otqrt`ms sn
Rdbshnm 64 ne sgd B`khenqmh` Qdudmtd `mc S`w`shnm Bncd-
3- @m d`rdldms enq ohodkhmdr `mc hmbhcdms`k otqonrdr+ qdbnqcdc Rdosdladq 0+ 0860 hm Annj 8677+
O`fd 660 ne Neehbh`k Qdbnqcr-
Hm E`unq ne9 Hquhmd Q`mbg V`sdq Chrsqhbs
@eedbsr9 ` onqshnm ne r`hc k`mc
4- @ mnm,dwbktrhud d`rdldms enq tshkhsx rxrsdlr `mc `bbdrr `mc hmbhcdms`k otqonrdr+ qdbnqcdc L`x
03+ 1//1 `r Hmrsqtldms Mn- 1//1/3/3488 ne Neehbh`k Qdbnqcr-
Hm E`unq ne9 Bhsx ne Strshm
@eedbsr9 Sgd k`mc
5- D`rdldmsr+ Bnudm`msr `mc Bnmchshnmr bnms`hmdc hm sgd cddc eqn
`r Fq`msnq+ sn Sgd Bhsx ne Strshm+ B`khenqmh`+ `r Fq`msdd+ qdbnq
1//2///422250 ne Neehbh`k Qdbnqcr- Qdedqdmbd adhmf l`cd sn sgd cnbtldms enq
ats cdkdshmf `mx bnudm`ms+ bnmchshnm+ nq qdrsqhbshnm hmchb`shmf ` oqdedqdmbd+ khlhs`shnm nq
chrbqhlhm`shnm a`rdc nm q`bd+ bnknq+ qdkhfhnm+ rdw+ g`mchb`o+ e`lhkh`k rs`str+ nq m`shnm`k nqhfhm+ sn
Ehqrs @ldqhb`m Shskd
Nqcdq Mtladq9 MGRB,3032/15 'sb(
O`fd Mtladq9 2
sgd dwsdms rtbg bnudm`msr+ bnmchshnmr nq qdrsqhbshnmr uhnk`sd 31
rs`sd k`v- K`vetk qdrsqhbshnmr tmcdq rs`sd `mc edcdq`k k`v nm sgd `fd ne nbbto`msr hm rdmhnq
gntrhmf nq gntrhmf enq nkcdq odqrnmr rg`kk mns ad bnmrsqtdc `r qdrsqhbshnmr a`rdc nm e`lhkh`k
rs`str-
6- Bnudm`msr `mc Bnmchshnmr bnms`hmdc hm sgd cddc eqnl Strshm Ot
Fq`msnq+ sn Bhsx ne Strshm+ B`khenqmh`+ `r Fq`msdd+ qdbnqcdc Itm
1//4///335660 ne Neehbh`k Qdbnqcr- Qdedqdmbd adhmf l`cd sn sgd cnbtldms enq
ats cdkdshmf `mx bnudm`ms+ bnmchshnm+ nq qdrsqhbshnm hmchb`shmf ` oqdedqdmbd+ khlhs`shnm nq
chrbqhlhm`shnm a`rdc nm q`bd+ bnknq+ qdkhfhnm+ rdw+ g`mchb`o+ e`lhkh`k rs`str+ nq m`shnm`k nqhfhm+ sn
sgd dwsdms rtbg bnudm`msr+ bnmchshnmr nq qdrsqhbshnmr uhnk`sd 31
rs`sd k`v- K`vetk qdrsqhbshnmr tmcdq rs`sd `mc edcdq`k k`v nm sgd `fd ne nbbto`msr hm rdmhnq
gntrhmf nq gntrhmf enq nkcdq odqrnmr rg`kk mns ad bnmrsqtdc `r qdrsqhbshnmr a`rdc nm e`lhkh`k
rs`str-
7- Bnudm`msr `mc Bnmchshnmr bnms`hmdc hm sgd cddc eqnl Strshm Ot
onvdqr `tsgnqhsx+ `r Fq`msnq+ sn Bhsx ne Strshm+ B`khenqmh`+ ` L
B`khenqmh`+ `r Fq`msdd+ qdbnqcdc Nbsnadq 3+ 1//5 `r Hmrsqtldms M1//5///550808 ne Neehbh`k
Qdbnqcr- Qdedqdmbd adhmf l`cd sn sgd cnbtldms enq etkk o`qshbtk`qr+ ats cdkdshmf `mx bnudm`ms+
bnmchshnm+ nq qdrsqhbshnm hmchb`shmf ` oqdedqdmbd+ khlhs`shnm nq chrbqhlhm`shnm a`rdc nm q`bd+ bnknq+
qdkhfhnm+ rdw+ g`mchb`o+ e`lhkh`k rs`str+ nq m`shnm`k nqhfhm+ sn sgd dwsdms rtbg bnudm`msr+ bnmchshnmr
nq qdrsqhbshnmr uhnk`sd 31 T-R-B- ¢25/3'b( nq `ookhb`akd rs`sd k`v- K`vetk qdrsqhbshnmr tmcdq rs`sd
`mc edcdq`k k`v nm sgd `fd ne nbbto`msr hm rdmhnq gntrhmf nq gntrhmf enq nkcdq odqrnmr rg`kk mns
ad bnmrsqtdc `r qdrsqhbshnmr a`rdc nm e`lhkh`k rs`str-
8- Hmsdmshnm`kkx Cdkdsdc
0/- Hmsdmshnm`kkx Cdkdsdc
00- Hmsdmshnm`kkx Cdkdsdc
01- Hmsdmshnm`kkx Cdkdsdc
02- Hmsdmshnm`kkx Cdkdsdc
03- Hmsdmshnm`kkx Cdkdsdc
04- Sgd sdqlr `mc oqnuhrhnmr bnms`hmdc hm sgd cnbtldms dmshskdc
qdbnqcdc L`x 03+ 1//1 `r Hmrsqtldms Mn- 1//1/3/3478 ne Neehbh`k Qdbnqcr-
05- D`rdldmsr+ Bnudm`msr `mc Bnmchshnmr bnms`hmdc hm sgd cddc eq
`r Fq`msnq+ sn Sgd Bhsx ne Strshm+ B`khenqmh`+ `r Fq`msdd+ qdbnq
Mn- 1//1/3/3487 ne Neehbh`k Qdbnqcr- Qdedqdmbd adhmf l`cd sn sgd cnbtldms enq
ats cdkdshmf `mx bnudm`ms+ bnmchshnm+ nq qdrsqhbshnm hmchb`shmf ` oqdedqdmbd+ khlhs`shnm nq
chrbqhlhm`shnm a`rdc nm q`bd+ bnknq+ qdkhfhnm+ rdw+ g`mchb`o+ e`lhkh`k rs`str+ nq m`shnm`k nqhfhm+ sn
sgd dwsdms rtbg bnudm`msr+ bnmchshnmr nq qdrsqhbshnmr uhnk`sd 31
rs`sd k`v- K`vetk qdrsqhbshnmr tmcdq rs`sd `mc edcdq`k k`v nm sgd `fd ne nbbto`msr hm rdmhnq
gntrhmf nq gntrhmf enq nkcdq odqrnmr rg`kk mns ad bnmrsqtdc `r qdrsqhbshnmr a`rdc nm e`lhkh`k
rs`str-
Ehqrs @ldqhb`m Shskd
Nqcdq Mtladq9 MGRB,3032/15 'sb(
O`fd Mtladq9 3
06- Sgd e`bs sg`s sgd k`mc khdr vhsghm sgd antmc`qhdr ne sgd LB@
`r chrbknrdc ax sgd cnbtldms qdbnqcdc Itmd 07+ 1//2 `r Hmrsqtldm1//2///60/725 ne
Neehbh`k Qdbnqcr-
07- Sgd deedbs ne ` cnbtldms dmshskdc Qdrnktshnm Mn- 02,06+ qdbn `r Hmrsqtldms
Mn- 1/02///070241 ne Neehbh`k Qdbnqcr-
Ehqrs @ldqhb`m Shskd
Nqcdq Mtladq9 MGRB,3032/15 'sb(
O`fd Mtladq9 4
HMENQL@SHNM@K MNSDR
Mnsd9 Sgd onkhbx sn ad hrrtdc l`x bnms`hm `m `qahsq`shnm bk`trd- Vgdm sgd @lntms ne Hmrtq`mbd hr kdrr
sg`m sgd bdqs`hm cnkk`q `lntms rds enqsg hm `mx `ookhb`akd `qahs
`qahsq`sdc `s sgd noshnm ne dhsgdq sgd Bnlo`mx nq sgd Hmrtqdc `r
xnt cdrhqd sn qduhdv sgd sdqlr ne sgd onkhbx+ hmbktchmf `mx `qahsq`shnm bk`trd sg`s l`x ad hmbktcdc+
bnms`bs sgd neehbd sg`s hrrtdc sghr Bnllhsldms nq Qdonqs sn nas`
onkhbx sg`s hr sn ad hrrtdc hm bnmmdbshnm vhsg xntq sq`mr`bshnm-
Sgd l`o `ss`bgdc+ he `mx+ l`x nq l`x mns ad ` rtqudx ne sgd k`mc cdohbsdc gdqdnm- Ehqrs @ldqhb`m
dwoqdrrkx chrbk`hlr `mx kh`ahkhsx enq knrr nq c`l`fd vghbg l`x qdrtks eqnl qdkh`mbd nm sghr l`o dwbdos sn
sgd dwsdms bnudq`fd enq rtbg knrr nq c`l`fd hr dwoqdrrkx oqnuhcdc ax sgd sdqlr `mc oqnuhrhnmr ne sgd shskd
hmrtq`mbd onkhbx+ he `mx+ sn vghbg sghr l`o hr `ss`bgdc-
Ehqrs @ldqhb`m Shskd
Nqcdq Mtladq9 MGRB,3032/15 'sb(
O`fd Mtladq9 5
Ehqrs @ldqhb`m Shskd Bnlo`mx
014/ Bnqnm` Onhmsd Bntqs+ Rsd 1/0
Bnqnm`+ B@ 81768
'840(145,477/
E`w , '8/8(365,13/0
VHQD HMRSQTBSHNMR
enq
Ehqrs @ldqhb`m Shskd Bnlo`mx+ Cdl`mc.Cq`es Rta,Drbqnv Cdonrhsr
Qhudqrhcd Bntmsx+ B`khenqmh`
Ehqrs @ldqhb`m Sqtrs+ ERA
4 Ehqrs @ldqhb`m V`x
R`ms` @m`+ B@ 816/6
A`mjhmf Rdquhbdr9 '766( 5//,8362
@A@ 011130144
Bqdchs sn Ehqrs @ldqhb`m Shskd Bnlo`mx
@bbntms Mn- 2/8673////
Qdedqdmbd Shskd Nqcdq Mtladq 3032/15 `mc Shskd Neehbdq Sdqqdkk B
Okd`rd vhqd sgd c`x adenqd qdbnqchmf-
Ehqrs @ldqhb`m Shskd
Nqcdq Mtladq9 MGRB,3032/15 'sb(
O`fd Mtladq9 6
KDF@K CDRBQHOSHNM
Qd`k oqnodqsx hm sgd Bhsx ne Strshm+ Bntmsx ne Nq`mfd+ Rs`sd ne B`khenqmh`+ cdrbqhadc `r enkknvr9
KNSR 7 SGQNTFG 03+ HMBKTRHUD @MC KDSSDQDC KNSR LL SGQNTFG UU+ BB
YYY+ BBBB+ EEEE+ FFFF @MC NNNNN NE SQ@BS MN- 063/3 @R RGNVM NM @
ANNJ 8/6+ O@FDR 5 SGQNTFG 31+ HMBKTRHUD NE LHRBDKK@MDNTR L@OR+ QDBNQCR NE
NQ@MFD BNTMSX+ B@KHENQMH@ @MC BDQSHEHB@SD NE BNQQDBSHNM QDBNQCDC
@R HMRSQTLDMS MN- 1/02///317274 NE NEEHBH@K QDBNQCR-
@OM9 32/,270,08 `mc 32/,270,1/ `mc 32/,270,10 `mc 32/,270,11 `mc
270,13 `mc 32/,270,14 `mc 32/,270,36 `mc 32/,270,37 `mc 32/,270,
32/,270,40 `mc 32/,270,41 `mc 32/,270,43 `mc 32/,270,44 `mc 32/,
`mc 32/,270,48 `mc 32/,270,5/ `mc 32/,270,50 `mc 32/,270,6/ `mc
61 `mc 32/,270,62 `mc 32/,280,6/
Ehqrs @ldqhb`m Shskd
Nqcdq Mtladq9 MGRB,3032/15 'sb(
O`fd Mtladq9 7
MNSHBD
Rdbshnm 01302-0 ne sgd B`khenqmh` Hmrtq`mbd Bncd+ deedbshud I`mt`qx 0+ 088/+ qdpthqdr sg`s `mx shskd h
bnlo`mx+ tmcdqvqhssdm shskd bnlo`mx+ nq bnmsqnkkdc drbqnv bnlo`m
b`o`bhsx+ v`hs ` rodbhehdc mtladq ne c`xr `esdq cdonrhshmf etmcr+ adenqd qdbnqchmf `mx cnbtldmsr hm bnmmdbshnm
vhsg sgd sq`mr`bshnm nq chratqrhmf etmcr- Sghr rs`stsd `kknvr enq etmcr cdonrhsdc ax vhqd sq`mredq sn ad chratqrdc
sgd r`ld c`x `r cdonrhs- Hm sgd b`rd ne b`rghdq&r bgdbjr nq bdqshehdc bgdbjr+ etmcr l`x ad chratqrdc sgd mdws c`x
`esdq cdonrhs- Hm nqcdq sn `unhc tmmdbdrr`qx cdk`xr ne sgqdd sn rdudm c`xr+ nq lnqd+ okd`rd trd vhqd sq`mredq+
b`rghdq&r bgdbjr+ nq bdqshehdc bgdbjr vgdmdudq onrrhakd-
He xnt g`ud `mx ptdrshnmr `ants sgd deedbs ne sghr mdv k`v+ okd`
lnqd cds`hkr-
Ehqrs @ldqhb`m Shskd
Nqcdq Mtladq9 MGRB,3032/15 'sb(
O`fd Mtladq9 8
DWGHAHS @
KHRS NE OQHMSDC DWBDOSHNMR @MC DWBKTRHNMR 'AX ONKHBX SXOD(
BKS@.@KS@ GNLDNVMDQ&R ONKHBX NE SHSKD HMRTQ@MBD '/1,/2,0/(
DWBKTRHNMR
Hm `cchshnm sn sgd Dwbdoshnmr hm Rbgdctkd A+ Xnt `qd mns hmrtqdc `f`hmrs knrr+ bnrsr+ `ssnqmdxr& eddr+ `mc dwodmrdr qdrtkshmfqnl9
0-
Fnudqmldms`k onkhbd onvdq+ `mc sgd dwhrsdmbd nq uhnk`shnm ne sgn
'`( athkchmf: 'c( hloqnudldmsr
'a( ynmhmf: 'd( k`mc chuhrhn
'b( k`mc trd: 'e( dmuhqnmldms`
Sghr Dwbktrhnm cndr mns khlhs sgd bnudq`fd cdrbqhadc hm Bnudqdc
1-
Sgd e`hktqd ne Xntq dwhrshmf rsqtbstqdr+ nq `mx o`qs ne sgdl+ snSghr Dwbktrhnm
cndr mns khlhs sgd bnudq`fd cdrbqhadc hm Bnudqdc Qhrj 03 nq 04-
2-
Sgd qhfgs sn s`jd sgd K`mc ax bnmcdlmhmf hs- Sghr Dwbktrhnm cndr mns khlhs sgd bnudq`fd cdrbqhadc hm Bnudqdc Qhrj 06-
3-
Qhrjr9
'`( sg`s `qd bqd`sdc+ `kknvdc+ nq `fqddc sn ax Xnt+ vgdsgdq nq m
'a( sg`s `qd Jmnvm sn Xnt `s sgd Onkhbx C`sd+ ats mns sn Tr+ tmk
'b( sg`s qdrtks hm mn knrr sn Xnt: nq
'c( sg`s ehqrs nbbtq `esdq sgd Onkhbx C`sd , sghr cndr mns khlhs17-
4-
E`hktqd sn o`x u`ktd enq Xntq Shskd-
5-
K`bj ne ` qhfgs9
'`( sn `mx k`mc ntsrhcd sgd `qd` rodbhehb`kkx cdrbqhadc `mc qded
'a( hm rsqddsr+ `kkdxr+ nq v`sdqv`xr sg`s sntbg sgd K`mc-
Sghr Dwbktrhnm cndr mns khlhs sgd bnudq`fd cdrbqhadc hm Bnudqdc
6-
Sgd sq`mredq ne sgd Shskd sn Xnt hr hmu`khc `r ` oqdedqdmsh`k sq`mredq nq `r ` eq`tctkdms sq`mredq nq bnmudx`mbd tmcdq edcdq`k a`mjqtosbx+ rs`sd
hmrnkudmbx+ nq rhlhk`q bqdchsnqr& qhfgsr k`vr-
KHLHS@SHNMR NM BNUDQDC QHRJR
Xntq hmrtq`mbd enq sgd enkknvhmf Bnudqdc Qhrjr hr khlhsdc nm sgd7+ 08+ `mc 10
Xntq Cdctbshakd @lntms `mc Ntq L`whltl Cnkk`q Khlhs ne Kh`ahkhsx
Xntq Cdctbshakd @lntmsNtq L`whltl Cnkk`q
Khlhs ne Kh`ahkhsx
Bnudqdc Qhrj 059 0$ ne Onkhbx @lntms nq #1+4//-// 'vghbgdudq hr
Bnudqdc Qhrj 079 0$ ne Onkhbx @lntms nq #4+///-// 'vghbgdudq hr
Bnudqdc Qhrj 089 0$ ne Onkhbx @lntms nq #4+///-// 'vghbgdudq hr
Bnudqdc Qhrj 109 0$ ne Onkhbx @lntms nq #1+4//-// 'vghbgdudq hr
@KS@ QDRHCDMSH@K SHSKD HMRTQ@MBD ONKHBX '5,0,76(
DWBKTRHNMR
Hm `cchshnm sn sgd Dwbdoshnmr hm Rbgdctkd A+ xnt `qd mns hmrtqdc `f`hmrs knrr+ bnrsr+ `ssnqmdxr& eddr+ `mc dwodmrdr qdrtkshmfqnl9
0-
Fnudqmldms`k onkhbd onvdq+ `mc sgd dwhrsdmbd nq uhnk`shnmmf `mc ynmhmf
nqchm`mbdr `mc `krn k`vr `mc qdftk`shnmr bnmbdqmhmf9
'`( `mc trd
'a( hloqnudldmsr nm sgd k`mc
'b( `mc chuhrhnm
'c( dmuhqnmldms`k oqnsdbshnm
Sghr dwbktrhnm cndr mns `ookx sn uhnk`shnmr nq sgd dmenqbdldms nsd-
Ehqrs @ldqhb`m Shskd
Nqcdq Mtladq9 MGRB,3032/15 'sb(
O`fd Mtladq9 0/
Sghr dwbktrhnm cndr mns khlhs sgd ynmhmf bnudq`fd cdrbqhadc hm H
1-
Sgd qhfgs sn s`jd sgd k`mc ax bnmcdlmhmf hs+ tmkdrr9
'`( ` mnshbd ne dwdqbhrhmf sgd qhfgs `ood`qr hm sgd otakhb qdbnq
'a( sgd s`jhmf g`oodmdc oqhnq sn sgd Onkhbx C`sd `mc hr ahmchmf nm xnt he xnt antfgs sgd k`mc vhsgnts jmnvhmf ne sgd s`jhmf
2-
Shskd Qhrjr9
'`( sg`s `qd bqd`sdc+ `kknvdc+ nq `fqddc sn ax xnt
'a( sg`s `qd jmnvm sn xnt+ ats mns sn tr+ nm sgd Onkhbx C`sd ,,
'b( sg`s qdrtks hm mn knrr sn xnt
'c( sg`s ehqrs `eedbs xntq shskd `esdq sgd Onkhbx C`sd ,, sghr c Bnudqdc Shskd Qhrjr
3-
E`hktqd sn o`x u`ktd enq xntq shskd-
4-
K`bj ne ` qhfgs9
'`( sn `mx k`mc ntsrhcd sgd `qd` rodbhehb`kkx cdrbqhadc `mc qded
'a( hm rsqddsr+ `kkdxr+ nq v`sdqv`xr sg`s sntbg xntq k`mc
Sghr dwbktrhnm cndr mns khlhs sgd `bbdrr bnudq`fd hm Hsdl 4 ne B
1//5 @KS@ KN@M ONKHBX '/5,06,/5(
DWBKTRHNMR EQNL BNUDQ@FD
Sgd enkknvhmf l`ssdqr `qd dwoqdrrkx dwbktcdc eqnl sgd bnudq`fd nsr+ `ssnqmdxr&
eddr+ nq dwodmrdr sg`s `qhrd ax qd`rnm ne9
0-
'`( @mx k`v+ nqchm`mbd+ odqlhs+ nq fnudqmldms`k qdftk`shnm 'hmbk`shmf+
oqnghahshmf+ nq qdk`shmf sn
'h( sgd nbbto`mbx+ trd+ nq dminxldms ne sgd K`mc:
'hh( sgd bg`q`bsdq+ chldmrhnmr+ nq knb`shnm ne `mx hloqnudldms d
'hhh( sgd rtachuhrhnm ne k`mc: nq
'hu( dmuhqnmldms`k oqnsdbshnm:
nq sgd deedbs ne `mx uhnk`shnm ne sgdrd k`vr+ nqchm`mbdr+ nq fnuhlhs sgd
bnudq`fd oqnuhcdc tmcdq Bnudqdc Qhrj 4-
'a( @mx fnudqmldms`k onkhbd onvdq- Sghr Dwbktrhnm 0'a( cndr mns
1-
Qhfgsr ne dlhmdms cnl`hm- Sghr Dwbktrhnm cndr mns lnchex nq khlh
2-
Cdedbsr+ khdmr+ dmbtlaq`mbdr+ `cudqrd bk`hlr+ nq nsgdq l`ssdqr
'`( bqd`sdc+ rteedqdc+ `rrtldc+ nq `fqddc sn ax sgd Hmrtqdc Bk`h
'a( mns Jmnvm sn sgd Bnlo`mx+ mns qdbnqcdc hm sgd Otakhb Qdbnqcr`s C`sd ne Onkhbx+ ats Jmnvm sn sgd Hmrtqdc Bk`hl`ms `mc mns chrbknrdc
hm vqhshmf sn sgd Bnlo`mx ax sgd Hmrtqdc Bk`hl`ms oqhnq sn sgd c`sd sgd Hmrtqdc Bk`hl`ms adb`ld `m Hmrtqdc tmcdq sghr onkhbx:
'b( qdrtkshmf hm mn knrr nq c`l`fd sn sgd Hmrtqdc Bk`hl`ms:
'c( `ss`bghmf nq bqd`sdc rtardptdms sn C`sd ne Onkhbx 'gnvdudq+ hr cndr mns lnchex nq khlhs sgd bnudq`fd oqnuhcdc tmcdq Bnudqdc Qhrj 00+
02+ nq 03(: nq
'd( qdrtkshmf hm knrr nq c`l`fd sg`s vntkc mns g`ud addm rtrs`hm`fd-
3-
Tmdmenqbd`ahkhsx ne sgd khdm ne sgd Hmrtqdc Lnqsf`fd adb`trd ne d cnhmf,
atrhmdrr k`vr ne sgd rs`sd vgdqd sgd K`mc hr rhst`sdc-
4-
Hmu`khchsx nq tmdmenqbd`ahkhsx hm vgnkd nq hm o`qs ne sgd khdm nsgd Hmrtqdc Lnqsf`fd sg`s `qhrdr nts ne sgd sq`mr`bshnm duhcdmbdc ax sgd
Hmrtqdc Lnqsf`fd `mc hr a`rdc tonm trtqx nq `mx bnmrtldq bqdchs
5-
@mx bk`hl+ ax qd`rnm ne sgd nodq`shnm ne edcdq`k a`mjqtosbx+ rs`sd hmrnkudmbx+ nq rhlhk`q bqdchsnqr& qhfgsr k`vr+ sg`s sgd sq`mr`bshnm bqd`shmf
sgd khdm ne sgd Hmrtqdc Lnqsf`fd+ hr
'`( ` eq`tctkdms bnmudx`mbd nq eq`tctkdms sq`mredq+ nq
'a( ` oqdedqdmsh`k sq`mredq enq `mx qd`rnm mns rs`sdc hm Bnudqdc
6-
@mx khdm nm sgd Shskd enq qd`k drs`sd s`wdr nq `rrdrrldmsr hlonr`sd ne
Onkhbx `mc sgd c`sd ne qdbnqchmf ne sgd Hmrtqdc Lnqsf`fd hm sgd akhb Qdbnqcr- Sghr Dwbktrhnm cndr mns lnchex nq khlhs sgd bnudq`fd
oqnuhcdc tmcdq Bnudqdc Qhrj 00'a(-
Sgd `anud onkhbx enql l`x ad hrrtdc sn `eenqc dhsgdq Rs`mc`qc Bnudq`fd nq Dwsdmcdc Bnudq`fd- Hm `cchshnm sn sgd `anud Dwbktrhnmr eqnl
Bnudq`fd+ sgd Dwbdoshnmr eqnl Bnudq`fd hm ` Rs`mc`qc Bnudq`fd onkhbx vhkk `krn hmbktcd sgd enkknvhmf Dwbdoshnmr eqnl Bnudq`fd9
DWBDOSHNMR EQNL BNUDQ@FD
Sghr onkhbx cndr mns hmrtqd `f`hmrs knrr nq c`l`fd '`mc sgd Bnlo ax qd`rnm ne9
0-'`( S`wdr nq `rrdrrldmsr sg`s `qd mns rgnvm `r dwhrshmf khdmr ax
`rrdrrldmsr nm qd`k oqnodqsx nq ax sgd Otakhb Qdbnqcr: 'a( oqnbddchmfr ax ` otakhb `fdmbxsg`s l`x qdrtks hm s`wdr nq
Ehqrs @ldqhb`m Shskd
Nqcdq Mtladq9 MGRB,3032/15 'sb(
O`fd Mtladq9 00
`rrdrrldmsr+ nq mnshbdr ne rtbg oqnbddchmfr+ vgdsgdq nq mns rgnv
1-@mx e`bsr+ qhfgsr+ hmsdqdrsr+ nq bk`hlr sg`s `qd mns rgnvm ax sgd Otakhb Qdbnqcr ats sg`s bntkc ad `rbdqs`hmdc ax `m
hmrodbshnm ne sgd K`mc nq sg`s l`x ad `rrdqsdc ax odqrnmr hm on
2-D`rdldmsr+ khdmr nq dmbtlaq`mbdr+ nq bk`hlr sgdqdne+ mns rgnvm a
3-@mx dmbqn`bgldms+ dmbtlaq`mbd+ uhnk`shnm+ u`qh`shnm+ nq `cudqrd
`m `bbtq`sd `mc bnlokdsd k`mc rtqudx ne sgd K`mc `mc mns rgnvm a
4-'`( Tmo`sdmsdc lhmhmf bk`hlr: 'a( qdrdqu`shnmr nq dwbdoshnmr hm f sgd hrrt`mbd sgdqdne: 'b( v`sdq
qhfgsr+ bk`hlr nq shskd sn v`sdq+ vgdsgdq nq mns sgd l`ssdqr dwb
5-@mx khdm nq qhfgs sn ` khdm enq rdquhbdr+ k`anq nq l`sdqh`k mns
1//5 @KS@ NVMDQ&R ONKHBX '/5,06,/5(
DWBKTRHNMR EQNL BNUDQ@FD
Sgd enkknvhmf l`ssdqr `qd dwoqdrrkx dwbktcdc eqnl sgd bnudq`fd nsr+ `ssnqmdxr&
eddr+ nq dwodmrdr sg`s `qhrd ax qd`rnm ne9
0-
'`( @mx k`v+ nqchm`mbd+ odqlhs+ nq fnudqmldms`k qdftk`shnm 'hmbk`shmf+
oqnghahshmf+ nq qdk`shmf sn
'h( sgd nbbto`mbx+ trd+ nq dminxldms ne sgd K`mc:
'hh( sgd bg`q`bsdq+ chldmrhnmr+ nq knb`shnm ne `mx hloqnudldms d
'hhh( sgd rtachuhrhnm ne k`mc: nq
'hu( dmuhqnmldms`k oqnsdbshnm:
nq sgd deedbs ne `mx uhnk`shnm ne sgdrd k`vr+ nqchm`mbdr+ nq fnuhlhs sgd
bnudq`fd oqnuhcdc tmcdq Bnudqdc Qhrj 4-
'a( @mx fnudqmldms`k onkhbd onvdq- Sghr Dwbktrhnm 0'a( cndr mns
1-
Qhfgsr ne dlhmdms cnl`hm- Sghr Dwbktrhnm cndr mns lnchex nq khlh
2-
Cdedbsr+ khdmr+ dmbtlaq`mbdr+ `cudqrd bk`hlr+ nq nsgdq l`ssdqr
'`( bqd`sdc+ rteedqdc+ `rrtldc+ nq `fqddc sn ax sgd Hmrtqdc Bk`h
'a( mns Jmnvm sn sgd Bnlo`mx+ mns qdbnqcdc hm sgd Otakhb Qdbnqcr`s C`sd ne Onkhbx+ ats Jmnvm sn sgd Hmrtqdc Bk`hl`ms `mc mns chrbknrdc
hm vqhshmf sn sgd Bnlo`mx ax sgd Hmrtqdc Bk`hl`ms oqhnq sn sgd c`sd sgd Hmrtqdc Bk`hl`ms adb`ld `m Hmrtqdc tmcdq sghr onkhbx:
'b( qdrtkshmf hm mn knrr nq c`l`fd sn sgd Hmrtqdc Bk`hl`ms:
'c( `ss`bghmf nq bqd`sdc rtardptdms sn C`sd ne Onkhbx 'gnvdudq+ hr cndr mns lnchex nq khlhs sgd bnudq`fd oqnuhcdc tmcdq Bnudqdc Qhrj 8 nq
0/(: nq
'd( qdrtkshmf hm knrr nq c`l`fd sg`s vntkc mns g`ud addm rtrs`hm
3-
@mx bk`hl+ ax qd`rnm ne sgd nodq`shnm ne edcdq`k a`mjqtosbx+ rs`sd hmrnkudmbx+ nq rhlhk`q bqdchsnqr& qhfgsr k`vr+ sg`s sgd sq`mr`bshnm udrshmf
sgd Shskd `r rgnvm hm Rbgdctkd @+ hr
'`( ` eq`tctkdms bnmudx`mbd nq eq`tctkdms sq`mredq+ nq
'a( ` oqdedqdmsh`k sq`mredq enq `mx qd`rnm mns rs`sdc hm Bnudqdc
4-
@mx khdm nm sgd Shskd enq qd`k drs`sd s`wdr nq `rrdrrldmsr hlonr`sd ne
Onkhbx `mc sgd c`sd ne qdbnqchmf ne sgd cddc nq nsgdq hmrsqtldms Rbgdctkd @-
Sgd `anud onkhbx enql l`x ad hrrtdc sn `eenqc dhsgdq Rs`mc`qc Bnudq`fd nq Dwsdmcdc Bnudq`fd- Hm `cchshnm sn sgd `anud Dwbktrhnmr eqnl
Bnudq`fd+ sgd Dwbdoshnmr eqnl Bnudq`fd hm ` Rs`mc`qc Bnudq`fd onkhbx vhkk `krn hmbktcd sgd enkknvhmf Dwbdoshnmr eqnl Bnudq`fd9
DWBDOSHNMR EQNL BNUDQ@FD
Sghr onkhbx cndr mns hmrtqd `f`hmrs knrr nq c`l`fd '`mc sgd Bnlo ax qd`rnm ne9
0-'`( S`wdr nq `rrdrrldmsr sg`s `qd mns rgnvm `r dwhrshmf khdmr ax
`rrdrrldmsr nm qd`k oqnodqsx nq ax sgd Otakhb Qdbnqcr: 'a( oqnbddchmfr ax ` otakhb `fdmbx sg`s l`x qdrtks hm s`wdr nq
`rrdrrldmsr+ nq mnshbdr ne rtbg oqnbddchmfr+ vgdsgdq nq mns rgnv
1-@mx e`bsr+ qhfgsr+ hmsdqdrsr+ nq bk`hlr sg`s `qd mns rgnvm ax sgd Otakhb Qdbnqcr ats sg`s bntkc ad `rbdqs`hmdc ax `m
hmrodbshnm ne sgd K`mc nq sg`s l`x ad `rrdqsdc ax odqrnmr hm on
2-D`rdldmsr+ khdmr nq dmbtlaq`mbdr+ nq bk`hlr sgdqdne+ mns rgnvm a
3-@mx dmbqn`bgldms+ dmbtlaq`mbd+ uhnk`shnm+ u`qh`shnm+ nq `cudqrd
`m `bbtq`sd `mc bnlokdsd k`mc rtqudx ne sgd K`mc `mc mns rgnvm a
4-'`( Tmo`sdmsdc lhmhmf bk`hlr: 'a( qdrdqu`shnmr nq dwbdoshnmr hm o`sdmsr nq hm @bsr `tf sgd hrrt`mbd sgdqdne: 'b( v`sdq
qhfgsr+ bk`hlr nq shskd sn v`sdq+ vgdsgdq nq mns sgd l`ssdqr dwb
5-@mx khdm nq qhfgs sn ` khdm enq rdquhbdr+ k`anq nq l`sdqh`k mns
Ehqrs @ldqhb`m Shskd
@KS@ DWO@MCDC BNUDQ@FD QDRHCDMSH@K KN@M ONKHBX '/6,15,0/(
DWBKTRHNMR EQNL BNUDQ@FD
Sgd enkknvhmf l`ssdqr `qd dwoqdrrkx dwbktcdc eqnl sgd bnudq`fd nsr+ `ssnqmdxr&
eddr+ nq dwodmrdr sg`s `qhrd ax qd`rnm ne9
0-
'`( @mx k`v+ nqchm`mbd+ odqlhs+ nq fnudqmldms`k qdftk`shnm 'hmbk`shmf+
oqnghahshmf+ nq qdk`shmf sn
'h( sgd nbbto`mbx+ trd+ nq dminxldms ne sgd K`mc:
'hh( sgd bg`q`bsdq+ chldmrhnmr+ nq knb`shnm ne `mx hloqnudldms d
'hhh( sgd rtachuhrhnm ne k`mc: nq
'hu( dmuhqnmldms`k oqnsdbshnm:
nq sgd deedbs ne `mx uhnk`shnm ne sgdrd k`vr+ nqchm`mbdr+ nq fnukhlhs sgd
bnudq`fd oqnuhcdc tmcdq Bnudqdc Qhrj 4+ 5+ 02'b(+ 02'c(+ 03 nq
'a( @mx fnudqmldms`k onkhbd onvdq- Sghr Dwbktrhnm 0'a( cndr mns 02'b(+
02'c(+ 03 nq 05-
1-
Qhfgsr ne dlhmdms cnl`hm- Sghr Dwbktrhnm cndr mns lnchex nq khlh
2-
Cdedbsr+ khdmr+ dmbtlaq`mbdr+ `cudqrd bk`hlr+ nq nsgdq l`ssdqr
'`( bqd`sdc+ rteedqdc+ `rrtldc+ nq `fqddc sn ax sgd Hmrtqdc Bk`h
'a( mns Jmnvm sn sgd Bnlo`mx+ mns qdbnqcdc hm sgd Otakhb Qdbnqcr`s C`sd ne Onkhbx+ ats Jmnvm sn sgd Hmrtqdc Bk`hl`ms `mc mns chrbknrdc
hm vqhshmf sn sgd Bnlo`mx ax sgd Hmrtqdc Bk`hl`ms oqhnq sn sgd c`sd sgd Hmrtqdc Bk`hl`ms adb`ld `m Hmrtqdc tmcdq sghr onkhbx:
'b( qdrtkshmf hm mn knrr nq c`l`fd sn sgd Hmrtqdc Bk`hl`ms:
'c( `ss`bghmf nq bqd`sdc rtardptdms sn C`sd ne Onkhbx 'gnvdudq+ hr cndr mns lnchex nq khlhs sgd bnudq`fd oqnuhcdc tmcdq Bnudqdc Qhrj 00+
05+ 06+ 07+ 08+ 1/+ 10+ 11+ 12+ 13+ 16 nq 17(: nq
'd( qdrtkshmf hm knrr nq c`l`fd sg`s vntkc mns g`ud addm rtrs`hm`fd-
3-
Tmdmenqbd`ahkhsx ne sgd khdm ne sgd Hmrtqdc Lnqsf`fd adb`trd ne d cnhmf,
atrhmdrr k`vr ne sgd rs`sd vgdqd sgd K`mc hr rhst`sdc-
4-
Hmu`khchsx nq tmdmenqbd`ahkhsx hm vgnkd nq hm o`qs ne sgd khdm nsgd Hmrtqdc Lnqsf`fd sg`s `qhrdr nts ne sgd sq`mr`bshnm duhcdmbdc ax sgd
Hmrtqdc Lnqsf`fd `mc hr a`rdc tonm trtqx nq `mx bnmrtldq bqdchs f k`v- Sghr Dwbktrhnm cndr mns lnchex nq khlhs
sgd bnudq`fd oqnuhcdc hm Bnudqdc Qhrj 15-
5-
@mx bk`hl ne hmu`khchsx+ tmdmenqbd`ahkhsx nq k`bj ne oqhnqhsx ne f`fd `r sn @cu`mbdr nq lnchehb`shnmr l`cd `esdq sgd
Hmrtqdc g`r Jmnvkdcfd sg`s sgd udrsdd rgnvm hm Rbgdctkd @ hr mn bx- Sghr
Dwbktrhnm cndr mns lnchex nq khlhs sgd bnudq`fd oqnuhcdc hm Bnud
6-
@mx khdm nm sgd Shskd enq qd`k drs`sd s`wdr nq `rrdrrldmsr hlonrs sn C`sd
ne Onkhbx- Sghr Dwbktrhnm cndr mns lnchex nq khlhs sgd bnudq`fd oqnuhcdc hm Bnudqdc Qhrj 00'a( nq 14-
7-
Sgd e`hktqd ne sgd qdrhcdmsh`k rsqtbstqd+ nq `mx onqshnm ne hs+ `bbnqc`mbd vhsg
`ookhb`akd athkchmf bncdr- Sghr Dwbktrhnm cndr mns lnchex nq kh
8-
@mx bk`hl+ ax qd`rnm ne sgd nodq`shnm ne edcdq`k a`mjqtosbx+ rs`sd hmrnkudmbx+ nq rhlhk`q bqdchsnqr& qhfgsr k`vr+ sg`s sgd sq`mr`bshnm bqd`shmf
sgd khdm ne sgd Hmrtqdc Lnqsf`fd+ hr
'`( ` eq`tctkdms bnmudx`mbd nq eq`tctkdms sq`mredq+ nq
'a( ` oqdedqdmsh`k sq`mredq enq `mx qd`rnm mns rs`sdc hm Bnudqdc
Ehqrs @ldqhb`m Shskd
Oqhu`bx Hmenql`shnm
Vd @qd Bnllhssdc sn R`edft`qchmf Btrsnldq Hmenql`shnm
Hm nqcdq sn adssdq rdqud xntq mddcr mnv `mc hm sgd etstqd+ vd l` sg`s xnt l`x ad bnmbdqmdc `ants vg`s vd vhkk cn vhsg rtbg
hmenql`shnm , o`qshbtk`qkx `mx odqrnm`k nq ehm`mbh`k hmenql`shnmd odqrnm`k hmenql`shnm xnt oqnuhcd sn tr- Sgdqdenqd+ snfdsgdq vh
rtarhch`qhdr vd g`ud `cnosdc sghr Oqhu`bx Onkhbx sn fnudqm sgd t
@ookhb`ahkhsx
Sghr Oqhu`bx Onkhbx fnudqmr ntq trd ne sgd hmenql`shnm sg`s xnt d hmenql`shnm vd g`ud nas`hmdc eqnl `mx nsgdq rntqbd+ rtbg `r
hmenql`shnm nas`hmdc eqnl ` otakhb qdbnqc nq eqnl `mnsgdq odqrnm nq dmshsx- Ehqrs @ldqhb`m g`r `krn `cnosdc aqn`cdq fthcdkhmdr sg`s fnudqm ntq trd ne odqrnm`k hmenql`shnm qdf`qckdrr ne hsr rn
Ehqrs @ldqhb`m b`kkr sgdrd fthcdkhmdr hsr E`hq Hmenql`shnm U`ktd
Sxodr ne Hmenql`shnm
Cdodmchmf tonm vghbg ne ntq rdquhbdr xnt `qd tshkhyhmf+ sgd sxod9
Hmenql`shnm vd qdbdhud eqnl xnt nm `ookhb`shnmr+ enqlr `mc hm nsdognmd nq `mx nsgdq ld`mr:
Hmenql`shnm `ants xntq sq`mr`bshnmr vhsg tr+ ntq `eehkh`sdc bnlo
Hmenql`shnm vd qdbdhud eqnl ` bnmrtldq qdonqshmf `fdmbx-
Trd ne Hmenql`shnm
Vd qdptdrs hmenql`shnm eqnl xnt enq ntq nvm kdfhshl`sd atrhmdrr dqdenqd+ vd vhkk mns qdkd`rd xntq hmenql`shnm sn mnm`eehkh`sdc o
dwbdos9 '0( `r mdbdrr`qx enq tr sn oqnuhcd sgd oqnctbs nq rdquhb gnvdudq+ rsnqd rtbg hmenql`shnm hmcdehmhsdkx+ hmbktchmf sgd odq
`esdq vghbg `mx btrsnldq qdk`shnmrgho g`r bd`rdc- Rtbg hmenql`shk deenqsr nq btrsnldq `m`kxrhr- Vd l`x `krn oqnuhcd `kk ne sgd s
mnmotakhb odqrnm`k hmenql`shnm khrsdc `anud sn nmd nq lnqd ne ntbh`k rdquhbd oqnuhcdqr+ rtbg `r shskd hmrtqdqr+ oqnodqsx `mc b`r
hmrtqdqr+ `mc sqtrs `mc hmudrsldms `cuhrnqx bnlo`mhdr+ nq bnlo`mdr+ gnld v`qq`msx bnlo`mhdr `mc drbqnv bnlo`mhdr- Etqsgdqlnqd+
vd l`x `krn oqnuhcd `kk sgd hmenql`shnm vd bnkkdbs+ `r cdrbqhadc`ke+ nm adg`ke ne ntq `eehkh`sdc bnlo`mhdr nq sn nsgdq ehm`mbh`k
hmrshstshnmr vhsg vgnl vd nq ntq `eehkh`sdc bnlo`mhdr g`ud inhms
Enqldq Btrsnldqr
Dudm he xnt `qd mn knmfdq ntq btrsnldq+ ntq Oqhu`bx Onkhbx vhkk
Bnmehcdmsh`khsx `mc Rdbtqhsx
Vd vhkk trd ntq adrs deenqsr sn dmrtqd sg`s mn tm`tsgnqhydc o`qssn mnmotakhb odqrnm`k hmenql`shnm `ants xnt sn sgnrd hmchuhct`kr
dmshshdr vgn mddc sn jmnv sg`s hmenql`shnm sn oqnuhcd oqnctbsr ndqrdd ntq dloknxddr `mc `fdmsr sn dmrtqd sg`s xntq hmenql`shnm v
g`mckdc qdronmrhakx `mc hm `bbnqc`mbd vhsg sghr Oqhu`bx Onkhbx ``hm ogxrhb`k+ dkdbsqnmhb+ `mc oqnbdctq`k r`edft`qcr sg`s bnlokx
edcdq`k qdftk`shnmr sn ft`qc xntq mnmotakhb odqrnm`k hmenql`shnm
Hmenql`shnm Nas`hmdc Sgqntfg Ntq Vda Rhsd
Ehqrs @ldqhb`m Ehm`mbh`k Bnqonq`shnm hr rdmrhshud sn oqhu`bx hrr sqd`s sgd hmenql`shnm `ants xnt vd qdbdhud nm sgd Hmsdqmds-
Hm fdmdq`k+ xnt b`m uhrhs Ehqrs @ldqhb`m nq hsr `eehkh`sdrÒ Vda dud`khmf `mx hmenql`shnm `ants xntqrdke- Ntq Vda rdqudqr bnkkdbs
cnl`hm m`ldr+ mns sgd d,l`hk `ccqdrrdr+ ne uhrhsnqr- Sghr hmenqlld rodms nm sgd rhsd+ o`fdr uhdvdc `mc rhlhk`q hmenql`shnm- Ehqr
@ldqhb`m trdr sghr hmenql`shnm sn ld`rtqd sgd trd ne ntq rhsd `m
Sgdqd `qd shldr+ gnvdudq+ vgdm vd l`x mddc hmenql`shnm eqnl xnt+c+ vd vhkk trd ntq adrs deenqsr sn kds xnt jmnv `s sgd shld ne
bnkkdbshnm gnv vd vhkk trd sgd odqrnm`k hmenql`shnm- Trt`kkx+ sg sn xntq hmpthqx+ oqnbdrr `m nqcdq nq `kknv xnt sn `bbdrr rodbhe
`bbntms.oqnehkd hmenql`shnm- He xnt bgnnrd sn rg`qd `mx odqrnm`kd onkhbhdr ntskhmdc `anud-
Atrhmdrr Qdk`shnmrghor
Ehqrs @ldqhb`m Ehm`mbh`k Bnqonq`shnm&r rhsd `mc hsr `eehkh`sdr& j nmkx sn rhsdr sg`s rg`qd ntq ghfg rs`mc`qcr `mc qdrodbs enq oq
mns qdronmrhakd enq sgd bnmsdms nq sgd oqhu`bx oq`bshbdr dloknxd
Bnnjhdr
Rnld ne Ehqrs @ldqhb`m&r Vda rhsdr l`x l`jd trd ne !bnnjhd! sdbg xntq odqrnm`k s`rsdr- @ bnnjhd hr `m dkdldms ne c`s` sg`s ` Vda
b`m rdmc sn xntq aqnvrdq+ vghbg l`x sgdm rsnqd sgd bnnjhd nm xnt
Ehqrs@l-bnl trdr rsnqdc bnnjhdr- Sgd fn`k ne sghr sdbgmnknfx hr sn adssdq rd `mc sn oqnuhcd xnt vhsg ` lnqd ld`mhmfetk `mc
oqnctbshud Vda rhsd dwodqhdmbd-
,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,
E`hq Hmenql`shnm U`ktdr
E`hqmdrr
Vd bnmrhcdq bnmrtldq dwodbs`shnmr `ants sgdhq oqhu`bx hm `kk nt e`unq`akd a`k`mbd adsvddm bnmrtldq admdehsr `mc bnmrtldq
oqhu`bx-
Otakhb Qdbnqc
Vd adkhdud sg`s `m nodm otakhb qdbnqc bqd`sdr rhfmhehb`ms u`ktdnqstmhsx- Vd `bshudkx rtoonqs `m nodm otakhb qdbnqc
`mc dlog`rhyd hsr hlonqs`mbd `mc bnmsqhatshnm sn ntq dbnmnlx-
Trd
Vd adkhdud vd rgntkc adg`ud qdronmrhakx vgdm vd trd hmenql`shnmhmf sgd bnkkdbshnm+ trd `mc chrrdlhm`shnm ne c`s`-
@bbtq`bx
Vd vhkk s`jd qd`rnm`akd rsdor sn gdko `rrtqd sgd `bbtq`bx ne sg s`jd qd`rnm`akd rsdor sn bnqqdbs hm`bbtq`sd hmenql`shnm-
Vgdm+ `r vhsg sgd otakhb qdbnqc+ vd b`mmns bnqqdbs hm`bbtq`sd hmr hm hcdmshexhmf sgd rntqbd ne sgd dqqnmdntr c`s` rn sg`s sgd bn
b`m rdbtqd sgd qdpthqdc bnqqdbshnmr-
Dctb`shnm
Vd dmcd`unq sn dctb`sd sgd trdqr ne ntq oqnctbsr `mc rdquhbdr+ ntq dloknxddr `mc nsgdqr hm ntq hmctrsqx `ants sgd hlonqs`mbd ne bnmrtldq oqhu`bx- Vd vhkk hmrsqtbs ntq dloknxddr nm
ntq e`hq hmenql`shnm u`ktdr `mc nm sgd qdronmrhakd bnkkdbshnm `mdbs `mc trd hmenql`shnm hm ` qdronmrhakd l`mmdq-
Rdbtqhsx
Vd vhkk l`hms`hm `ooqnoqh`sd e`bhkhshdr `mc rxrsdlr sn oqnsdbs hms`hm-
Enql 4/,OQHU@BX '7.0./8( O`fd 0 ne 0 Oqhu`bx Hmenql`shnm '1//0,
Attachment 5
ATTACHMENT 5
TUSTINLEGACY
CITYBENEFITEDPROPERTY
Attachment 6
ATTACHMENT 6
CITY ESTOPPEL
________________, 20__
[Transferee]
_________________
_________________
Attn:____________
Re:[Developer/Development Name]
Ladies and Gentlemen:
Transferee
The undersigned is writingthis letter to you (“”) regarding thatcertain single-
Project
family home project (the “”) that [has been] [may be] constructed on the land legally
Development Parcels
described onExhibit “A”attached hereto(the “”).
City
The City of Tustin, a municipal corporation of the State of California(the “”),and
Developer
Standard Pacific Corp., a Delaware corporation(“”),entered into that certain Tustin
Legacy Disposition and Development Agreement For Disposition Parcels1B and 6A,dated as of
DDA
_____________, 2014(“”), relating to the conveyance oftheDevelopmentParcelsby the
City to Developer and the subsequent development of the Development Parcelsby Developer, all
as more particularly set forth therein.All initially capitalized terms not otherwise defined herein
shall have the meanings ascribed to such terms in the DDA.
The City has executed that certain Declaration ofSpecial RestrictionsforDisposition
Special Restrictions
Parcels1B and 6A (the “”),dated _____________, 201_,that was recorded
Official Records
in the Office of the County Recorder,Orange County, California (“”), against
title to the Development Parcelson _____________, 201_as Instrument No. __________,which
includes, among other matters, certain requirements regarding the use and maintenance of the
Development Parcelsand sets forth those provisions of the DDA which survive the issuance of a
Certificate of Compliance with respect to the Project.
Quitclaim Deed
The City has executed aQuitclaim Deed (the “”) dated _____________,
201_ and recorded in the Official Records against title to the Development Parcelson
_____________, 201_as Instrument No. __________, pursuant to which the City conveyed to
Developer the fee title to the Development Parcels, subject to certain restrictions and limitations
set forth in the QuitclaimDeed.
In addition, Developer and the City executed that certain Memorandum ofTustin Legacy
Memorandum
Dispositionand Development AgreementFor Disposition Parcels1Band 6A(“
of DDA
”), dated _____________, 201_, which was recorded in the Official Records against title
to the Development Parcelson _____________, 201_as Instrument No. __________,and
provided record notice of the DDA.
1
Attachment 6 City EstoppelCity of Tustin/Standard Pacific
Tustin Standard Pacific City Estoppel 1-28-2014.DocJanuary 28, 2014
In addition, Developer and the City executed that certain Development Agreement
DA
(the“”), dated ___________, 201_, which was recorded in the Official Records against title
to the Development Parcelson ________________, 201_as Instrument No. __________.
TheDDA,the Memorandum of DDA,the DA, the Special Restrictions,and the
PropertyDocuments
Quitclaim Deedare collectively referred tohereinas the “.”
You have informed the undersigned City that Developer intends to Transfer its interest in
all or a portion of the Development Parcelsor a direct or indirect interest therein to Transfereeon
Transaction
or aroundthe date of this letter (the“”).
By its execution of this letter, the City hereby confirms to Transfereethat:
1.Except as set forth on Attachment 1to this letter,the PropertyDocuments are in
full force and effect and have not been modified, supplementedor amended, whether orally or in
writing, and have not been assigned or otherwise transferredby the City to any other person or
entity.
2.To the best of the City’s knowledge,except as set forth on Attachment 2to this
letter:(i) there are no defaults of Developer(including, without limitation, no Potential Defaults
and no Material Defaults)under any of the Property Documents nor any facts which now, or
after the giving of notice or the passage of time, or both, would constitute a default (including,
without limitation, a Potential Default or Material Default)under any of the Property Documents
or which would entitle the City to then exerciseany of its rights or remedies under any of the
Property Documents, including, without limitation,its Right of Reversion or Right of Purchase
pursuant tothe DDA;and (ii)the City has no current claim of breach, counterclaim, lien or offset
presently existing under any of the Property Documents.
As used in this letter, the phrase “to the best of the City’s knowledge” andwords of like
import, meanthat the facts in question are actually known (as opposed to imputed, inquiry or
constructive knowledge) to the City Manager, based upon such individual’s own knowledge after
areasonable review of the relevant records and filesin the possession of the City.
2
Attachment 6 City EstoppelCity of Tustin/Standard Pacific
Tustin Standard Pacific City Estoppel 1-28-2014.DocJanuary 28, 2014
The undersigned acknowledges that Transfereemay rely upon this letter in entering into
the proposed Transaction. This letter is written in connection only with the proposed
Transaction and may be relied upon only byTransfereeas to the matters addressed herein.This
lettermay not be relied upon by any other party or for any other purpose without the express
written consent of the City.This certificate shall be binding upon the City and its successors and
assigns.In no event shall the individual executing this Estoppelon behalf of the Cityhave any
personal liability hereunder.
CITY OF TUSTIN
Dated: ________, 20__By:
Name: _____________________________
City Manager
ATTEST:
By:
Name:______________
City Clerk
APPROVED AS TO FORM:
By:_________________________
Name: ______________________
City Attorney
3
Attachment 6 City EstoppelCity of Tustin/Standard Pacific
Tustin Standard Pacific City Estoppel 1-28-2014.DocJanuary 28, 2014
Exhibit “A”
Legal Description of the Parcel 1B and Parcel 6AProperty
4
Attachment 6 City EstoppelCity of Tustin/Standard Pacific
Tustin Standard Pacific City Estoppel 1-28-2014.DocJanuary 28, 2014
Attachment 1
Modifications, Supplements or Amendments to Property Documents
1.[enter “None” if there are no qualifications]
5
Attachment 6 City EstoppelCity of Tustin/Standard Pacific
Tustin Standard Pacific City Estoppel 1-28-2014.DocJanuary 28, 2014
Attachment 2
Qualifications to Matters Confirmed in Estoppel
1.[enter “None” if there are no qualifications]
6
Attachment 6 City EstoppelCity of Tustin/Standard Pacific
Tustin Standard Pacific City Estoppel 1-28-2014.DocJanuary 28, 2014
Attachment 7A
ATTACHMENT NO. 7A
PRE-CLOSING SCHEDULE
DDAItemActionResponsible
Party
1.EXECUTION OF AGREEMENT
A4.3.1; Developer executes Within five (5) Business Days after the Developer
4.4;DDA and delivers later of (a) approval by the City Council
4.6.5Purchase Price of the DDA or (b) approval by the City
Deposit and City Council of the Development Agreement.
Costs Depositand
Declaration
certified by general
counsel of
Developer
B4.4City executes DDAWithin 5 Business Days following City
Developer’s submission of executed
DDA and delivery to Escrow of Purchase
Price Deposit and City Costs Deposit
CEffective Date of Date of execution by City of DDACity
the DDA
DCity delivers Within 2 Business Days following City
executed DDA and execution of DDA by City
Attachments to
Escrow
E1.8.1Developer pays If the amount of ENA Transaction Developer
outstanding ENA Expenses to the Effective Date exceeds
Deposit amountsthe amount of the ENA Deposit,
Developer shall pay the City such
outstanding amounts due within thirty
(30) calendar days following receipt of
an invoice from the City therefor.
F5.6Review of Certain City shall, within ten (10) Business Days City
Records and of the Effective Date, provide Developer
Materialswith copies of all City-produced plans,
1
Attachment 7A Pre Closing ScheduleCity of Tustin/Standard Pacific
Tustin Standard Pacific Pre Closing Schedule 1-30-2014January 30, 2014
DDAItemActionResponsible
Party
reports, studies, investigations and other
materials the City may have in its
possession that are pertinent to the
Property and/or development of the
Project and not previously delivered.
G11.1,Developer to Within seven (7) Business Days after the Developer
11.2.3provide evidence of Effective Date.
liability, worker’s
compensation and
automobile
insurance
2.CONVEYANCE OF PROPERTY FROM CITY TO DEVELOPER
A4.6.2Covenants; At least thirty (30) calendar days prior to Developer
Preconditions to Close of Escrow, Developer shall submit
Close of Escrow -an update of the Financing Plan to the
Additional City, for the purposes of confirming that
AssurancesDeveloper has sufficient funds for
construction of the Project and for its
operation consistent with the terms of
this Agreement and without a Mortgage.
B6.1Survey by Prior to the end of the Due Diligence Developer
DeveloperPeriod, Developer at Developer’s sole
expense shall have obtained a survey for
Survey
the Property (“”) prepared by a
Surveyor
licensed surveyor (“”), which
Survey shall be certified by the Surveyor
to the City, Developer and the Title
Company.
C6.2Obtain Preliminary Prior to the end of the Due Diligence Developer
Title ReportPeriod
D5.1Due Diligence Developer may elect to conduct due Developer
diligence during the period commencing
2
Attachment 7A Pre Closing ScheduleCity of Tustin/Standard Pacific
Tustin Standard Pacific Pre Closing Schedule 1-30-2014January 30, 2014
DDAItemActionResponsible
Party
Period.on the Effective Date and ending on the
date which is sixty (60) calendar days
following the Effective Date at 4:00 P.M.
Pacific Time.
E6.3Supplemental Title If, after the end of the Due Diligence Developer
ReportsPeriod, the Title Company discloses
additional matters that affect title to the
Development Parcels, then within ten
(10) calendar days after Developer’s
receipt of any report issued by the Title
Company concerning the Property (a
Supplemental Title Report
“”),
Developer shall provide the City a copy
of such Supplemental Title Report.
F7.2.1City delivery of all Not later than two (2) Business Days City
document deliveries prior to the Close of Escrow, the City
required for Close shall have executed and delivered to
of Escrow Escrow Holder the appropriated
documents, substantially in the form and
substance of the instruments attached as
Attachments to this Agreement, unless
otherwise agreed by the Parties, each in
their sole discretion.
GDeveloper delivery Not later than one (1) Business Day prior
of Developer to the Close of Escrow, Developer shall
Closing Payment deliver to Escrow (i) the Developer
and other costsClosing Payment with respect to the Base
Purchase Price and (ii) any other costs
explicitly set forth in this Agreement as
costs to be paid by Developer at the
Close of Escrow.
H7.2.2Developer delivery Not later than two (2) Business Days Developer
of all document prior to the Close of Escrow, the
3
Attachment 7A Pre Closing ScheduleCity of Tustin/Standard Pacific
Tustin Standard Pacific Pre Closing Schedule 1-30-2014January 30, 2014
DDAItemActionResponsible
Party
deliveries required Developer shall have executed and
for Close of Escrowdelivered to Escrow Holder the
appropriated documents, substantially in
the form and substance of the instruments
attached as Attachments to this
Agreement, unless otherwise agreed by
the Parties, each in their sole discretion.
H7.3Additional Close of Escrow Holder shall have delivered at Escrow
Escrow Conditionsleast seven (7)Business Days prior to the Holder
Close of Escrowa statement of costs to
each Party and at least two (2) Business
Days prior to the Close of Escroweach
of the Parties shall have approved such
statement as being consistent with the
provisions of Section7.4
I7.2.2(g)Formation of all Prior to the Close of Escrow unless City
special assessment otherwise agreed by the City in its sole
districts, CFDs or discretion; but this condition is deemed
the likewaived if the Close of Escrow takes
place after July31, 2014.
J11.1.4; Developer to Prior to Close of EscrowDeveloper
11.2.5provide a binder
evidencing
environmental
insurance to
become effective as
of Close of Escrow
K7.1.1Close of EscrowUnless otherwise mutually agreed by the Developer
Parties in writing, the Close of Escrow and City
shall take place on that date which is ten
(10) Business Days following the last to
occur of the satisfaction,or the waiver
thereof by the Party for whose benefit the
condition applies, of the Developer
Closing Conditions set forth in Sections
4
Attachment 7A Pre Closing ScheduleCity of Tustin/Standard Pacific
Tustin Standard Pacific Pre Closing Schedule 1-30-2014January 30, 2014
DDAItemActionResponsible
Party
7.2.1(d), (e) and (f) and the City Closing
Conditions set forth in Sections 7.2.2(c),
(d), (e), (f), (g), (h), (j) and (k)provided
that in no event shall Developer be
obligated to close unless it has received
at least ten (10) Business Days’ advance
written notice from the Cityof the
anticipated date for satisfaction of such
City Closing Conditions and provided,
further, that the Close of Escrow shall in
no event be later than May 30, 2014(the
“Outside Closing Date”).
The Close of Escrow shall be subject to
the satisfaction of the conditions set forth
in Sections 7.2, 7.3 and 7.4.
Notwithstanding anything to the contrary
set forth in this Agreement,the Outside
Closing Date shall be automatically
extended to August 15, 2014 in the event
one or more of the Closing Conditions
set forth are not satisfied ten (10)
Business Days prior to May30, 2014due
to factors outside of Developer’s
reasonable control.
5
Attachment 7A Pre Closing ScheduleCity of Tustin/Standard Pacific
Tustin Standard Pacific Pre Closing Schedule 1-30-2014January 30, 2014
Attachment 7B
ATTACHMENT 7B
SCHEDULE OF PERFORMANCE
DDAItemActionResponsible
Party
1.MAPPING, GRADING, INFRASTRUCTURE, UTILITIES, BUILDING
PERMITS
ADeveloper Prior toClose of EscrowDeveloper
submits request
for permits for
Grading Work,
and submits all
Grading Work
Performance
Bonds
BCity issues City shall use good faith efforts to issue City
permits for Grading Permits withinten (10)Business
Grading WorkDays following each of the following: (a)
approval of Grading Work improvement
plans, (b) Developer submittal of request
for permits, (c) Developer’s payment of
all required permit fees, (d) Developer’s
provision of all required Grading Work
Performance Bonds, (e) satisfaction of all
required conditions of approval in the
Entitlements and the DA and additional
conditions set forth in the DDA
associated with issuance of permits for
the Grading Work.
C8.8Developer Prior to issuance of building permits for Developer and
submits Final Homes, including Models.City
Map for approval
and Developer
and City enter
into Subdivision
Improvement
Agreement.
D8.9.1Provision of The earlier of (a) eight (8) months Developer
Performance following Close of Escrowand(b) the
Bonds for all date set forth in the Subdivision
Horizontal Improvement Agreement for provision of
Improvements bonds, but in all cases, prior to issuance
other than of the first permit for the construction of
Grading WorkHorizontal Improvements other than the
Grading Work.
1
Attachment 7BCity of Tustin/Standard Pacific
Tustin Standard Pacific Schedule of Performance 1-28-2014January 28, 2014
DDAItemActionResponsible
Party
EDeveloper Within six (6)months following the Developer
submits final Close of Escrow.
plans for
Horizontal
Improvements to
the City for
approval.
F8.4.3Developer shall Within twelve (12) months following the
submit for Effective Date of the DDA.
approval by the
City in its
Governmental
Capacity, final
design drawings
and related
documents with
respect to the
Vertical
Improvements
conforming to the
requirements of
the City Code and
the Specific Plan
and all other
Entitlements and
conditions of
approval
GCity issues The City shall use good faith efforts to City
permits for all issue within (10) Business Days
Horizontal followingsatisfaction of each of the
Improvementsfollowing: (a) submission of a complete
other than application as determined by Community
Grading WorkDevelopment Department and Public
Works, (b) approval of Horizontal
Improvement plans by the City, (c)
Developer’s payment of all required
permit fees, (d) Developer’s provision of
all required Performance Bonds,(e)
approval by the City of any modifications
to Approved Plans, and (f) satisfaction of
all required conditions of approval in the
Entitlements and the DA and additional
conditions set forth in the DDA
associated with issuance of permits for
the Horizontal Improvements.
2
Attachment 7BCity of Tustin/Standard Pacific
Tustin Standard Pacific Schedule of Performance 1-28-2014January 28, 2014
DDAItemActionResponsible
Party
HCity issues With respect to each building permit
building permitsapplication, City shall use good faith
efforts to issue within ten (10) Business
Days followingsatisfaction of each of the
following:(a) submission of a complete
application as determined by Community
Development Department and Public
Works; (b) approval of building plans by
the City; (c) approval by the City of any
modifications to Approved Plans; (d)
Developer’s payment of all required
Project Fair ShareContribution and all
permit feesapplicable to the permits
requested; (e) satisfaction of all required
conditions of approval in the Entitlements
and the DA and additional conditions set
forth in the DDA associated with issuance
of the applicable buildingpermits; (d)
approval of Final Map and execution of
Subdivision Improvement Agreement;
and (e) Recording of the Final Map.
2.CONSTRUCTION OF IMPROVEMENTS
A8.9.1Grading Work Within one (1) month following the later Developer
and Horizontal of issuance of a grading permit by the
ImprovementsCity or the Close of Escrow, Developer
shall commence the Grading Work.
Horizontal Improvements other than
Grading Work (and excluding Park
Facilities) shall have been commenced
within nine (9) months following Close of
Escrow.
All Horizontal Improvements other than
Park Facilities shall have been completed
within twenty four (24) months following
commencement of the Grading Work.
B8.9.2(a)Construction of Developer commences construction of Developer
Models and Park Models within one (1) month following
Facilities City issuance of building permits but in
no event later than the earlier of (x) three
(3) months following completion of all
Horizontal Improvements other than Park
Facilities or (y)thirty-six (36) months
3
Attachment 7BCity of Tustin/Standard Pacific
Tustin Standard Pacific Schedule of Performance 1-28-2014January 28, 2014
DDAItemActionResponsible
Party
following the Close of Escrow.
Complete construction of and open
Models and Park Facilities including
amenities to the public within the earlier
of (a) forty-two (42) months following
the Close of Escrow or (b) six (6) months
following the completion of all
Horizontal Improvements other than Park
Facilities.
Model construction on the Development
Parcels to consist of four (4) model
complexes (for a total of twelve (12)
Models) representative of Homes in each
of the four product types proposed to be
constructed as part of the Project.
The Model complexes shall be
constructed and completed prior to
completion of Homes within the first area
of the Property to be developed.
C8.9.2(b)Initial Product Complete construction of initial Developer
Inventoryproduction home inventory within four
(4) months following Completion of the
Models and Park Facilities. Initial
product inventory requirement shall
consist of completion of framing and
exteriors for not less than four (4)Homes
within each product type (for a total of
sixteen (16) Homes) available for sale in
addition to the Models.
D8.Ongoing Construct, obtain valid certificates of
9.2(c)Inventory occupancy and offer for sale Homes in
Requirementproduction phases which are based upon a
reasonable analysis of market conditions
and anticipated absorption. Taking into
consideration the market conditions and
anticipated absorption, Developer shall
use reasonable efforts to commence
construction of each subsequent
production phase of Homes not later than
the close of escrowon the last Home for
sale to the public in the prior production
4
Attachment 7BCity of Tustin/Standard Pacific
Tustin Standard Pacific Schedule of Performance 1-28-2014January 28, 2014
DDAItemActionResponsible
Party
phase.
Developer will be limited to 242
residential units until the Initial Channel
Condition has occurred.
E8.10.Channel City shall not issue building permits for City
nd
ImprovementsHomes after the 242Home until the
Initial Channel Condition has occurred.
Notwithstanding anything to the contrary
set forth in the DDA, if the City fails to
satisfy the Initial Channel Condition prior
to the Channel Condition Satisfaction
Date, then any and all of Developer’s
obligations with respect to the Schedule
of Performance, Inventory Commitment
and the construction, Completion and sale
of more than 242 Homes within the
Project shallbe extended (a) on a day for
day basis for each day following the
Channel Condition Satisfaction Date for
which the Initial Channel Condition has
not occurred and (b) if 180 or more
Homes have been Completed by the date
that the Initial Channel Conditionhas
occurred, an additional four (4) months.
F8.11Outside Date of Notwithstanding any other provision of Developer
Completion of the DDA, Developer shall be obligated to
ConstructionComplete the Project (including the
Horizontal Improvements, On-Lot
Improvements, Vertical Improvements
and all of the Homes) within the earlier of
(a) sixty (60) months following opening
of the Models to the public, as such date
may be extended for a maximum total of
twelve (12) months following the 60th
month for Force Majeure Delayor (b)
eighty-four (84) months after Close of
Escrow, provided that the foregoing
period to Complete may be extended for a
maximum total of twelve (12) months
following the 84th month for Force
Majeure Delay.
The time period for completion of
Vertical Improvements and On Lot
5
Attachment 7BCity of Tustin/Standard Pacific
Tustin Standard Pacific Schedule of Performance 1-28-2014January 28, 2014
DDAItemActionResponsible
Party
Improvements on that portion of the
Project transferred to a Builder Transferee
shall be reduced by six (6) months from
the time period otherwise set forth above;
provided that Developer’s time period for
completion shall not be shortened.
G8.17.1Dedication and City shall cause that portion of Park City
Completion of Avenue depicted on Attachment 21 to be
Public Roadscap paved prior to Developer’s opening
of the first Model. However, in no event
shall the dedication and cap paving be
completed prior to the opening of the
residential development on Parcel 1A
North (St. Anton). Promptly following
completion of construction of the roads
surrounding the Development Parcels, the
City shall properly dedicate such roads as
public roadways.
6
Attachment 7BCity of Tustin/Standard Pacific
Tustin Standard Pacific Schedule of Performance 1-28-2014January 28, 2014
Attachment 8
ATTACHMENT 8
SCOPE OF DEVELOPMENT
Note: References herein to the “Agreement” and the “DDA” shall mean the Disposition
and Development Agreement of which this Attachment is a part; references to
“Attachments” mean the Attachments to the Agreement unless otherwise specified.
Capitalized terms not otherwise defined in this Attachment have the meaning set forth in
the Agreement.
1.0General Information
The Development Parcelsare delineated on Attachment 2. The Development Parcelsare
subject to easements, obligations and encumbrances, including, but not limited to, the
following:
a)Covenantsand conditions contained in the Quitclaim Deedsfrom the United
States of America, as Grantor, to the City of Tustin, California, as Grantee,
Recorded May 14, 2002 as Instrument No. 20020404598 and on May 9, 2003 as
Instrument No. 2003000533361of Official Records.
b)Developershall improve and provide public access toallprivate streets, roadway
drives, alleywaysandsidewalkswithin the Development Parcels (“Private Streets
and Sidewalks”),the Greenbelt Areasand to the portions of the focal parkas
shown in Exhibit“A”to this Scope of Development and,pursuant to the Final
Map, shall record anaccess easement in favor of the City of Tustin for the benefit
of the public to ensure public access in, on, over and across the Private Streets and
Sidewalks, the Greenbelt Areas and the portions of the Park Facilities to be made
available to the publicas further shown on Exhibit “A” to this Scope of
Development.Developershall prepare the required legal descriptions and submit
to the City for review.
2.0DeveloperImprovements
2.1Definition of Improvements
Developershall construct on the Development Parcelsall of the Horizontal
Improvements, On-Lot Improvementsand Vertical Improvements and shall construct or
cause to be constructed to serve the Project certain private and public infrastructure as
required and approved by the City, including without limitation, the City Planning
Commission and City Council. This Attachment presents the Scope of Development and
minimal specific design criteria. Additional requirements may be contained in conditions
of approval of the entitlements for the Projectand in the Approved Plans.
1
Attachment 8 Scope of Development City of Tustin/Standard Pacific
Tustin Standard Pacific Scope of Development 1-31-2014 January 31, 2014
The Improvements shall generally consist of the following:
2.1.1Vertical Improvements. Developer shall complete the development of the
Vertical Improvements to consist of construction andinstallation of a single family
residential community projectwith design quality and amenities appropriate for the
community and linkage with Park Avenue to the west and Moffett Avenue to the north.
The Project will be located within the eastern portionof Planning Area 15of
Neighborhood Gof the Specific Plan and Lots 1 through 376ofTentative Tract Map
17507, and will consist of 375 single family detached residential units, including the
following product mix: (1) 103“Carriage Court Homes”;(2) 96 “Stafford”Homes; (3)
99 “Greenwood” Homes; (4) 77 “Crawford” Homes,Park Facilities and Common Areas.
Minor non-substantive modifications may occur during the building permit process,
subject to prior approval by the City.
Vertical Improvements shall include, but not be limited to, buildings, architectural
amenities, parking, security lighting, pedestrian amenities and trash enclosures. Design
of all Vertical Improvements shall be consistent with requirements of the Specific Plan,
development standards contained in Section 3.0of this Attachment, and additional
requirements contained in any conditions of approval of the entitlements for the Project
and the Approved Plans.
2.1.2Horizontal Improvementsand On-Lot Improvements. Developer shall be
responsible for construction of all Horizontal Improvements and On-Lot Improvements
which include any necessary private and public infrastructureand utilities including,
without limitation:
a)all grading(including any necessary import and/or export)onall Public Streets
and Sidewalks;
b)all utilities including connection of all utilities, including but not limited to sewer,
domestic and reclaimed water, electrical, gas, telephone, cable and
telecommunication service connections from their origin or Tustin Legacy
Backbone Infrastructure Program locations as shown in the Specific Plan or as
modified by private utility purveyors and as approved by the Director of Public
Works to the buildings and uses on the Development Parcels;
c)any drainage improvements needed to convey the drainage from the Development
Parcels;
d)Landscaping Improvements including, with limitation, any common area
landscape,irrigation and/or hardscape improvements including the landscape of
lots, medians, Common Areas on the Development Parcelsand other
improvements within the existing and proposed public right-of-way,as may be
required and approved by the Planning Commission and City Council, as
applicable, with approval of aDevelopment Agreement, Concept Plan approval,
Design Review,and any or other required entitlements.Developershall install
2
Attachment 8 Scope of Development City of Tustin/Standard Pacific
Tustin Standard Pacific Scope of Development 1-31-2014 January 31, 2014
and maintain landscaping to the back of curb, and shall enter into a Landscape
Maintenance Agreement for maintenance of the Boundary Landscape Areas.
Pursuant to the Landscape Maintenance Agreement,the City shall be responsible
for maintainingthemeanderingsidewalk within and outside the public right-of-
wayand certain slope areas owned by the City adjacent to Jamboree Roadand the
Landscaping Improvements on each of the foregoing.
e)The full improvement of the 6.1 acre focal park (referred to in the Agreement as a
portion of the Park Facilities) and 3.73 acres of Greenbelt Areas that are privately
owned but accessible to the public,as depictedon Exhibit “A”to this Scope of
Development except thatthe publicly accessible portion of the focal park shall be
5.22 acresas depicted on Exhibit “A”. All of the Greenbelt Areas shall be public
accessible.The focal park and Greenbelt Areas will serve as the open space
feature. The focal park shall be designed and constructed to incorporate all
passive and activeareas of the park and all Vertical Improvements asdescribed in
the Approved Plans and the entitlement conditions of approval.
f)Full improvements include, without limitation,all water lines, gas, storm
drainage, electricity, sewage and reclaimed water as shown in the Specific Plan
and/or Irvine Ranch Water District Sub Area Master Plan for Tustin Legacy,
and/or as approved by the City and responsible private utility purveyors. All
scope of work for design and construction includes, without limitation,all
surveying, rough and precise grading, import and export of dirt as required,
asphalt paving, including, without limitation,any necessaryoverlays, driveways,
sidewalks, concrete, curb and gutter, landscaping, irrigation, street lighting, all
traffic control, striping and signage and other work to construct improvements in
accordance with Tustin City standards.
2.1.3Compliance with Codes and Conditions.All of the Improvements shall conform
to all applicable federal, state, county and city regulations, the regulations of the Specific
Plan (with the exception of any Density Bonus related concessions or incentives that may
be granted by the Tustin City Council),the Tustin City Code,the conditions of City
resolutions(as and to the extent required by the DA)and all City of Tustin planning,
building, electrical, plumbing, mechanical, fire codes, public and private street standards
as well as compliance with all “Conditions ofApproval” stipulated by the City of Tustin
and any applicable governmental agency having jurisdiction including, but not limited to,
Planning Commission and City Council approvals.
As more particularly described and provided in Section3.0of the Agreement, all final
working drawings, specifications, grading plans, soil reports, landscaping plans, color
and finish schedules shall be approved by the City in its Proprietary Capacity and its
Governmental Capacity prior to start of the construction.
2.1.4Compliance with DDA.Developershall comply with all provisions of the
Agreement related to the planning, design, construction, and operation of the
Improvements.
3
Attachment 8 Scope of Development City of Tustin/Standard Pacific
Tustin Standard Pacific Scope of Development 1-31-2014 January 31, 2014
2.2Schedule of Performance
Developershall commence andcomplete the Improvements by the respective times
established in the Schedule of Performance (Attachment 7B).
3.0Development Standards
The Improvements shall be designed and developed as a planned development in which
all construction will have architectural quality and character, both individually and in the
context of the surrounding areaappropriate and customary for the community. All public
spaces, open space, and individual yard areas shall be designed, landscaped and developed
with comparablequality. Particular attention shall be paid to enhancing pedestrian
activities, minimizing mass, scale, and bulk and to the selection of color and materials.
The City and Developer will cooperate and direct their consultants, architects and/or
engineers to cooperate so as to ensure the continuity and coordination necessary for the
proper and timely completion of development of Improvements.
Developeracknowledges the responsibility to obtain any approvals required by any
governmental agency, utility or other agency, including the City, which has jurisdiction
over all of any portion of the Improvements. All “Conditions of Approval” stipulated by
an applicable jurisdiction shall be incorporated into the final design and noted in the
construction documents by the architects, engineers and other consultants. Developer
shall make all necessary applications by such time(s) as will be consistent with the timely
commencement and completion of various portions of the Improvements as identified in
the Schedule for Performance. In addition, the following development standards shall
apply to the Improvements:
3.1Architecture and Project Design
The Project design shall be of a quality design appropriate and customary for the
community and incorporating 4-sidearchitecture on all buildings in keeping with the
theme detailed in the Request for Proposals Disposition Package 1B, Tustin Legacy.The
Project design elements include concrete roof tiles, earth-tone stucco, a variety of
aesthetic enhancements includingwindow treatments, balconies, cornices, trim elements,
and incorporating varied colors, materials and finishes.
The Project shall reflect the following architectural guidelines:
Homes and buildings shalldefine and relate to the street edge, with architecture to
face the streets.
Homes and buildings shallframe and define public space with an especially
strong relationship between the building and street encouraged.
Architecture shallbe technically sophisticated in detailing, incorporating a rich
palette of natural materials and textures.
Visually interesting façade treatments with distinctive architectural elements and
design details.
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Attachment 8 Scope of Development City of Tustin/Standard Pacific
Tustin Standard Pacific Scope of Development 1-31-2014 January 31, 2014
Varied setbacks, projections, roof lines, windows and reveals, and elements that
minimize the impact of the building mass.
Homes and buildings designed with modern or traditional forms, accented by
unique architectural shapes and details.
Homes and buildings shallreflect aquality designappropriate and customary for
the communitythrough the incorporation of coordinated architecture utilizing
elements, materials, and colors that complement the relaxed, informal style.
Homes and buildings shallincorporate smaller-scale architectural details such as
porches, bays, recessed or projecting balconies, and dormers.
Varied building heights are encouraged, but with a predominantly vertical
expression.
Building façade articulation is encouraged.
Quality standardswill be consistent with the plans approved by the Planning Commission
andwill include landscaping in accordance with a landscaping paletteapproved by the
Cityin its Proprietary Capacity and its Governmental Capacity, appropriate front, rear
and side architectural building features and roof top screening of equipment,including
but not limited to upgraded exterior building materials on buildings visible to the public
from JamboreeRoad, Victory Road, Park Avenue, and Moffett Drive. Consistent
architecture style shall be evident in all elements of design, from all elevations of the
structures and treatment of roofs and parapets, down to smaller elements such as
community structuresand trash enclosures. Particular attention shall also be paid to
massing, scaleandcolor. Expression of such quality for the Project shallbe true to the
distinctive and unique elements of Tustin Legacy as described in Developer’s Proposal
and as may be further developed by the parties and approved by the City.
In general, the design of the Project shall encourage active participation by pedestrians by
providing suitable and attractive amenities in the Project and by reinforcing internal
relationships between the uses through streetscape design, pedestrian and bikeway
linkages, and site planning techniques. A strong visual identity for the Project shall be
created through creative design of community entries, landscape design along roadways,
signage and placement of views. Enhanced viewsinto the Project shall be considered
from all exterior roadways, including at the intersections at thecorners of Park Avenue
and Victory Road,Park Avenue and Moffett Drive, and at the Jamboree off-ramp at Park
Avenue. Creative site planning is encouraged for theDevelopment Parcelsdue to its
prominent location within the Specific Plan. Careful consideration of building site
location, attention to views, relationships to surrounding uses and open spaces all need to
be incorporated into site plans.
The Project shall also be designedin compliance with all applicable provisions of the
Specific Plan,as well as all site plan design objectives and provisions contained in the
Request for Proposals Disposition Package 1B, Tustin Legacy.
3.2Vehicular Access. The placement of vehicular driveways shall be coordinated
with the needs of proper street traffic flow. In the interest of minimizing traffic
congestion, the City will control the number and location of curb breaks for access to the
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Attachment 8 Scope of Development City of Tustin/Standard Pacific
Tustin Standard Pacific Scope of Development 1-31-2014 January 31, 2014
Development Parcels.Access to the Development Parcelsas depicted on Exhibit “A” to
this Scope of Developmentwill be subject to approval by the City Traffic Engineer.
Traffic signals will not be required to be constructed at the Development Parcelsentries;
however, if Developerdetermines that traffic signals are necessary to support the
development in the future the cost to design and construct the signal(s) will be the
responsibility of Developer.All access driveways shall require written approval of the
City of Tustin.
3.3Loading. Adequate loading and unloading space for Common Areasshall be
provided as approved by the City. Loading spaces visible from any abutting street to the
Project shall be landscaped to screen an unsightly or barren appearance consistent with
requirementsof the Specific Plan and/or Tustin City Code, as applicable(with the
exception of any Density Bonus related concessions or incentives that may be granted by
the Tustin City Council).
3.4Signs. Signs shall be designed to contribute positively to the environment. Signs
identifying the Project will be permitted, but their height, size, location, color, lighting
and design shall be subject to City approval and must conform to provisions of the
Specific Plan and/or Tustin City Code, as applicable and shallbe at a scale appropriate to
the overall design of the Project.
3.5Screening. All outdoor storage of materials or equipment shall be screened to the
extent and manner required by the City of Tustin. Tops of equipment shall be compatibly
screened from view from the surrounding streetsand from future mid-rise buildings
which may be located or constructed in the immediate area to the north, west, or south of
the Project.
3.6Landscaping.Developershall provide landscaping within the Landscape Areas as
defined in the DDA. This shall include Landscape Improvements along all of the
Development Parcel street frontages(from back of curb to the perimeter walls of the
Project), including Park Avenue,Victory Road, and Moffett Driveas required by the
Landscape Maintenance Agreementand Landscape Improvements within the Common
Areas of the Project as depicted on Exhibit “B” attached to this Scope of Work. All
Landscape Improvements shall comply with the Specific Plan, City Landscape
Guidelines, the conditions of approval related to landscaping,plans and drawings
approved by the City. Developershall maintain all such landscapinguntil responsibility
therefor has been assumed by the Homeowners’Association.
3.7Utilities. All utilities on the Development Parcelsshall be undergrounded.
3.8Maximum Development Thresholds/ Residential Land Use/Trip Budget.
Development on the Development Parcelsshall not exceed 375units for the Disposition
Parcel 1B and6A.
4.0Development ParcelsPreparation and Demolition. The Development Parcels
shall be delivered to Developerin an as-is condition; Developershall carry out all site
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Attachment 8 Scope of Development City of Tustin/Standard Pacific
Tustin Standard Pacific Scope of Development 1-31-2014 January 31, 2014
preparation (including, without limitation, demolition and relocation of utilities)
necessary for the provision of the HorizontalImprovements, On-Lot Improvementsand
Vertical Improvements. Site preparation shall include the following, without limitation:
A.Demolition. Demolition activities shall include, without limitation:
1.Insofar as necessary to provide the Improvements, the reduction and removal of
any structures and improvements from the Development Parcels, including
subsurface structures, and the removal of all bricks, lumber, pipes, equipment and
other materials and all debris and rubbish resulting from such demolition.
2.Insofar as necessary to provide the Improvements, the removal of all paving
(including catch basins, curbs, gutters, drives and sidewalks) within or on the
Development Parcels.
3.Removal and abandonment by public utility companies of such utility lines,
installation, facilities and related equipment within the Development Parcels
required to effectuate the purposes of the Project and this Agreement. Developer
will also be responsible for accepting a Billof Sale of all City-owned utility
systems previously owned by the military on the Development Parcelsand for
removal and abandonment of those systems for construction of Improvements.
The City is not responsible in any way for the filling of any excavation, nor for
grading or compaction. Soil conditions shall be solely the responsibility of
Developer.
B.Soil Conditions.Developerassumes responsibility to deal with all portions of the
Development Parcelsin an “as is”, “where is” condition, as more fully set forth in
Section4 of the Agreement. It shall be solely the responsibility of Developer to
investigate and determine the soil and subsurface conditions of the Development
Parcels. In the event such investigation indicates the conditions are not in all
respects entirely suitable for the use or uses to be included in the Project, then the
City shall have no responsibility or obligation to take such action as may be
necessary to place the Development Parcelsand the soil conditions of the
Development Parcelsin all respects in a condition entirely suitable for the
development of the Development Parcels.
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Attachment 8 Scope of Development City of Tustin/Standard Pacific
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EXHIBIT A
EXHIBIT A
Attachment 9
Attachment 10
Attachment 10
List of Environmental Reports and Statements
1/22/14
Provided as Part of CityRFP Materials
1.Finding of Suitability to Transfer, dated 9/28/01
2.Finding of Suitability to Transfer, dated 4/22/02
3.City Council Resolution 06-43, dated 4/3/06
4.Supplement EIR for TRR Responses, dated 8/26/04
5.Final EIS/EIR, Volume 1, dated 11/18/99
6.Final EIS/EIR, Volume 2, dated 12/9/99
7.Final EIS/EIR, Volume 3
Provided by City in Person (September 2013)
8.CRWQCB to TLCP (CWA Section 401) Letter, dated 6/4/07
9.CDFG to TLCP (1602 SAA Permit #: 1600-2006-0324-R5) Fax, dated 7/25/07
10.ACOE to TLCP (401 Permit #: 200500058-YJC) Letter, dated 7/11/07
1
Attachment 10 List of Environmental Reports and StatementsCity of Tustin/Standard Pacific
Tustin Standard Pacific List Of Env Reports & Stmts 1-28-2014.Docx January 28, 2014
Attachment 11
ATTACHMENT 11
QUITCLAIM DEED
CITY OF TUSTIN OFFICIAL BUSINESS
REQUEST DOCUMENT TO BE RECORDED
AND TO BE EXEMPT FROM RECORDING
FEES PER GOVERNMENT CODE §6103 AND
§27383.
Recording requested by and
when recorded mail to:
City Manager
The City of Tustin
300 Centennial Way
Tustin, CA 92780
Mail Tax Statements to:
Standard Pacific Corp.
15360 Barranca Parkway
Irvine, California 92618
Attn: Ted McKibbin
Space AboveThis Line Reserved for Recorder’s Use
QUITCLAIM DEED
FOR DISPOSITION PARCELS1BAND6A
AND COVENANTS, CONDITIONS AND RESTRICTIONS, INCLUDING
ENVIRONMENTAL RESTRICTION PURSUANT TO CIVIL CODE SECTION 1471
This Quitclaim Deed For Disposition Parcels1Band 6A and Covenants, Conditions and
Restrictions, Including Environmental Restriction Pursuant to Civil Code Section 1471(this
Quitclaim Deed
“”) is made on this ____day of __________________, 2014, by the CITY OF
GRANTOR
TUSTIN, California, a municipal corporation of the State of California (the “”), in
GRANTEE
favor of STANDARD PACIFIC CORP., a Delaware corporation (the“”).
WHEREAS:
Government
A.The United States of America (the “”) and the GRANTOR entered
into that certain Agreement between the United States of America (acting by and
through the Secretary of the Navyor designee) and the City of Tustin, California,
for the Conveyance of a Portion of the Former Marine Corps Air Station Tustin
MCAS TustinConveyance Agreement
(“”), dated May 13, 2002 (the “”);
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Attachment 11 Quitclaim Deed City of Tustin/Standard Pacific
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B.Pursuant to the Conveyance Agreement, the Government conveyed property at
Grantor Property
the Marine Corps Air Station Tustin (such property, the “”) to
the GRANTOR pursuant to that certain Quitclaim DeedHand Environmental
Restriction Pursuant to Civil Code Section 1471dated May 13, 2002, that was
recorded on May 14, 2002 in the Officeof the County Recorder, Orange County,
Official Records
California (the“”) as Instrument Number 20020404598
Government Deed
(the“”);
C.Pursuant to California Civil Code §1471,the Government determined that it is
reasonably necessary to impose certain restrictions on the use of the Grantor
Property to protect present and future human health or safety or the environment
as a result of the presence of hazardous materials on portions of the Grantor
Property described hereinafter with particularity;
D.The GRANTOR and the GRANTEE entered into the following: (i) that certain
Tustin Legacy Disposition and Development Agreement for Disposition Parcels
DDA
1Band 6A, dated as of ______________,2014(the “”), providing for the
sale and development of a portion of the Grantor Property; and (ii) that certain
Memorandum ofTustin LegacyDisposition and Development Agreement For
Memorandum ofDDA
Disposition Parcels1Band 6A(the “”) to be recorded in
the Official Records of even date with and immediately prior to the recording of
this Quitclaim Deed;
E.The GRANTOR has executed that certainDeclaration of Special Restrictionsfor
Special Restrictions
Disposition Parcels1Band 6A(the “”), consented to by the
GRANTEE, which shall be recorded in the Official Records immediately prior to
the recording of this Quitclaim Deed; and
F.The GRANTOR desires to convey and the GRANTEE desires to acquire a portion
of the Grantor Property to facilitate economic redevelopment in accordance with
that certain MCAS TustinReuse Plan adopted by the City Council of the City on
Reuse Plan
October 17, 1996 and amended in September, 1998 (the “”) and
approved by the Government for MCASTustin.
1.NOW THEREFORE, the GRANTOR, for good and valuable consideration, the receipt
and sufficiency of which is hereby acknowledged, does hereby remise, release and forever
quitclaim to the GRANTEE, all of the GRANTOR’S right, title and interest in and to that certain
real property, comprising approximately 74gross acresof land, more particularly described on
Land
Exhibit”A”attached hereto and incorporated herein by this reference (the “”),together
with all existing improvements, if any, presently located on the Land, all appurtenances
pertaining to the Parcel (as hereinafter defined) or such improvements and all permits, licenses,
approvals and authorizations issued by any governmental authority in connection with the
Parcels.The Land, less and except all of the matters in Section 2 of this Quitclaim Deed, is
Parcels
referred to as the“.”
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2.EXCEPTING THEREOUT AND THEREFROM, however, and reserving to the
GRANTOR, its successors and assigns, together with the right to grant andtransfer all or a
portion of the same, the following:
2.1Any and all oil, oil rights, minerals, mineral rights, natural gas, natural gas rights
and other hydrocarbon by whatsoever name known, geothermal steam and all products derived
from any of the foregoing, that may be within or under the Parcelstogether with the perpetual
right of drilling, mining, exploring for and storing in and removing the same from the Parcelsor
any other land, including the right to whipstock or directionally drill and mine from lands other
than the Parcels, oil or gas wells, tunnels and shafts into, through or across the subsurface of the
Parcelsand to bottom such whipstocked or directionally drilled wells, tunnels and shafts under
and beneath or beyond the exterior limits thereof, and to re-drill, re-tunnel, equip, maintain,
repair, deepen and operate any such well or mines; but without, however, the right to enter upon
or use the surface of the Parcelsin the exercise of such rights or otherwise adversely affect the
use or operation of the Parcelsas anticipated by this Agreement or the structural integrity of any
improvements on the Parcels; and
2.2Any and all water, water rights or interests therein appurtenant or relating to the
Parcelsor owned or used by the City in connection with or with respect to the Parcelsno matter
how acquired by the City, whether such water rights shall be riparian, overlying, appropriative,
littoral, percolating, prescriptive, adjudicated, statutory or contractual, together with the
perpetual right and power to explore, drill, re-drill and remove the same from or in the Parcels, to
store the same beneath the surface of the Parcelsand to divert or otherwise utilize such water,
rights or interests on any other property owned or leased by the City; but without, however, the
right to enter upon or use the surface of the Parcelsin the exercise of such rights or otherwise
adversely affect the use or operation of the Parcelsas anticipated by this Agreement or the
structural integrity of any improvements on the Parcels; and
2.3Those excess development rights remaining after deducting the number of
residential unitsallocated to the Parcels(anticipated to be 375 residential units) from the total
Specific Plan Planning Area 15 authorization of 1,214 residential units.The residential units
allocated to the Parcelsshall be equal to the number of Lots on the Final MapandGrantee shall
only be entitled to develop residential units equal to the number of Lots shown on the Final Map;
except to the extent any of such rights were conveyed by the City to third parties prior to the
Effective Date, the Cityshall retain all residential units and all development rights associated
with Specific Plan Planning Area 15 above the number of Lots shown on the Final Mapandsuch
residential units and development rights shall be freely transferable by the Citythroughout
Tustin Legacy.
Notwithstanding anything to the contrary set forth in this Quitclaim Deed, the reservation
by the GRANTOR of the rightsand interests in this Section2 shall not be deemed to limit the
GRANTEE’S right to construct foundations and other subsurface improvements for the purpose
of constructing the Project, and otherwise engage in subsurface construction activity in order to
construct the Project.
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3.SUBJECT TO THE FOLLOWING NOTICES, COVENANTS, RESTRICTIONS, AND
CONDITIONS, which shall be binding upon and enforceable against theParcelsand the
GRANTEE, and its successors and assigns, in perpetuity:
3.1The GRANTEE agrees to accept conveyance of theParcelssubject to all
covenants, conditions, restrictions, easements, rights-of-way, reservations, rights, agreements
and encumbrances of record, including, without limitation, the DDA, the Memorandum of DDA,
and the Special Restrictions, which are covenants running with the land and are binding upon the
GRANTEE and all successors and assigns of the GRANTEE owning all or any portion of
Parcelsfor the benefit of the GRANTOR and its successors and assigns, unless or until such
responsibilities and obligations are released pursuant to the provisions of the aforesaid
documents, including the release of obligations under the DDA that GRANTEE may obtain
pursuant to a Certificate of Compliance(as defined and further provided for in the DDA)
executed by the City and recorded against the Parcels.
3.2The Government Deed conveying theParcelsto the GRANTOR was recorded
prior to recordation of this Quitclaim Deed. The GRANTOR has no knowledge regarding the
accuracy of information provided by the Government regarding the environmental condition of
theParcelsand makes no warranties regarding the environmental conditions of theParcels. The
GRANTOR has no knowledge regarding the accuracy or adequacy of the Government’s
remediation of theParcelsas provided in the Government Deed.The foregoing Section 3.2 does
not limit or restrict any representations, warranties, covenants or obligationsthat the GRANTOR
may have made solely for the benefit of the GRANTEE(and its permitted transferees)in the
DDAor any other agreement.
3.3The italicized information below is copied verbatim (except as discussed below)
from Sections 2.2 through 2.6, and Sections 2.8, 2.9and 3of the Government Deed conveying
the Grantor Property to the GRANTOR. To the extent applicable to theParcelsconveyed
hereunder, by acceptance of this Quitclaim Deed, the GRANTEE,on behalf of itself and its
successors and assigns acquiring fee title to all or any portion of the Property, hereby
acknowledges and assumes all responsibilities placed upon the GRANTOR under the terms of
the aforesaid Government Deed. Within the italicized information only, the term “Grantor” shall
mean the Government, the term “Grantee” shall mean the City of Tustin and the term “Property”
shall mean the Grantor Property, including, without limitation, theParcels. To avoid confusion,
within the italicized information,the word “Government” has been added in brackets after the
word “Grantor”, and the words “City of Tustin” have been added in bracketsafter the word
“Grantee.”
2.2FOSTshavebeen completed and an Environmental Baseline Survey (“EBS”)
report is referenced in the FOSTs. The FOSTsand EBS reference environmental
conditions on the Property and on other property not subject to this Deed. GRANTEE
[“City of Tustin”] acknowledges that it has received copies of the EBS and the FOSTs
and that all documents referenced therein have been made available to GRANTEE [“City
of Tustin”] for inspection and copying.
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2.3Except as otherwise provided herein,or as otherwise provided by law, the
GRANTEE [“City of Tustin”] acknowledges that it has inspected, is aware of and
accepts the condition and state of repair of the Property, and that the Property is
conveyed “as is” and “where is” without any representation, promise, agreement, or
warranty on the part of the GRANTOR [“Government”] regarding such condition and
state of repair, or regarding the making of any alterations, improvements, repairs or
additions. Except for the environmental remediation which maybe required to be
undertaken by GRANTOR[“Government”] pursuant to paragraph 2.6 below, the
GRANTEE[“City of Tustin”] further acknowledges that the GRANTOR[“Government”]
shall not be liable for any latent or patent defects in the Property except to the extent
required by applicable law.
Asbestos Containing Material
2.4.
2.4.1.GRANTEE[“City of Tustin”]is hereby informed an does hereby
acknowledge that hazardous materials in the form of asbestos or asbestos-containing
materials (“ACM”) have been found and areotherwise presumed to exist in
Buildings/Structures. . .6168. . .on the Property. The EBS and FOSTsdisclose the
presence of known asbestos orACM hazards in such buildings and structures on the
Property.
2.4.2GRANTEE[“City of Tustin”]covenants, on behalf of itself, its successor
and assigns, as a covenant running with the land, that it will prohibit occupancy and use
of buildings and structures, or portions thereof, containing known asbestos or ACM
hazards prior to abatement of such hazards. In connection with its use and occupancy of
the Property, including, but not limited to, demolition of buildings and structures
containing asbestos or ACM, it will comply with all applicable federal, state and local
laws relating to asbestos and ACM.
2.4.3An ACM survey has not been conducted for Structure39.GRANTEE
[“City of Tustin”] shall prohibit occupancy and use of Structure 39 and portions thereof
until ACM surveys have been conducted by GRANTEE[“City of Tustin”]or its
successors and assigns, and any necessary abatement required under applicable federal,
state and local laws relating to asbestos and ACM has been completed by GRANTEE
[“City of Tustin”]or its successor sand assigns.
2.4.4The GRANTOR[“Government”]shall provide a notice of release, in
recordable form, to the GRANTEE[“City of Tustin”]at such time as demolition of the
buildings on the Property containing ACM has been completed and the appropriate
government regulatory agency(s) have confirmed in writing to the GRANTEE[“City of
Tustin”]that ACM has been removed from the buildings and any necessary soil
remediation has been conducted in accordance with all applicable federal, state, and
local laws and regulations. This notice of release shall be deemed to remove all notices
and restrictions relating to ACM from the Property. The GRANTOR[“Government”]
shall have no obligation under this subparagraph for the demolition of buildings or the
removal of ACM or soil remediation related to such demolition or removal action.
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Lead Based Paint (LBP)
2.5.
2.5.1.The Property may include improvements that are presumed to contain
LBP because they are thought to have been constructed prior to 1978. Buildings. . . .
23C, 23D, 23E, and 23Farerestricted from residential use and children are not allowed
to occupy the buildings. When thesebuildings aredemolished, the GRANTEE[“City of
Tustin”]or its successors and assigns, will be required to demolish the buildingsin
accordance with applicable laws and conduct post-demolition sampling and abatement of
any soil-lead hazards related to the demolition prior to occupation of any newly
constructed buildings. Lead from paint, paint chips, and dust can pose health hazards if
not managed properly. Pursuant to 40 CFR Section 745.113 the following notice is
provided: “Every purchaser of any interest in residential real property on whicha
residential dwelling was built prior to 1978 is notified that such property may present
exposure to lead from lead-based paint that may place young children at risk of
developing lead poisoning. Lead poisoning in young children may produce permanent
neurological damage, including learning disabilities, reduced intelligence quotient,
behavioral problems, and impaired memory. Lead poisoning also poses a particular risk
to pregnant women. The seller of any interest in residential real property is required to
provide the buyer with any information on lead-based paint hazards from risk
assessments or inspections in the seller’s possession and notify the buyer of any known
lead-based paint hazards. A risk assessment or inspection for possible lead-based paint
hazards is recommended prior to purchase.”
2.5.2The GRANTEE[“City of Tustin”]hereby acknowledges the required
disclosure of the presence of any known LBP and/or LBP hazards in target housing
constructed prior to 1978 in accordance with the Residential Lead-Based Paint Hazard
Reduction Act of 1992, 42 U.S.C. Section 4852d (Title X). The GRANTEE[“City of
Tustin”]acknowledges the receipt of available records and reports pertaining to LBP
and/or LBP hazards and receipt of the Environmental ProtectionAgency (EPA)
approved pamphlet “Protect Your Family from Lead in Your Home” (EPA 747-K-94-
001). Furthermore, the GRANTEE[“City of Tustin”]acknowledges that it has read and
understood the EPA pamphlet.
2.5.3The GRANTEE[“City of Tustin”]covenants and agrees that, in any
improvements on the Property defined as target housing by Title X and constructed prior
to 1978, LBP hazards will be disclosed to potential occupants in accordance with Title X
before use of such improvements as a residential dwelling(as defined in Title X).
Further, the GRANTEE[“City of Tustin”]covenants and agrees that LBP hazards in
target housing will be abated in accordance with Title X before use and occupancy as a
residential dwelling. “Target housing” means any housing constructed prior to 1978,
except housing for the elderly or persons with disabilities (unless any child who is less
than six [6] years of age resides, or is expected to reside, in such housing) or any zero-
bedroom dwelling.
2.5.4The GRANTEE[“City of Tustin”]covenants and agrees that in its use
and occupancy of the Property, it will comply with Title X and all applicable federal,
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state, and local laws relating to LBP. The GRANTEE[“City of Tustin”]acknowledges
that the GRANTOR[“Government”]assumes no liability for damages for personal
injury, illness, disability, or death to the GRANTEE[“City of Tustin”], or to any other
person, including members of the general public, arising from or incident to the
purchase, transportation, removal, handling, use, disposition, or other activity causing or
leading to contact of any kind whatsoever with LBP on the Property, arising after the
conveyance of the Property from the GRANTOR[“Government”]to the GRANTEE
[“City of Tustin”], whether the GRANTEE[“City of Tustin”]has properly warned, or
failed to properly warn, the persons injured.
2.5.5The GRANTOR[“Government”]shall provide a notice of release, in
recordable form, to the GRANTEE[“City of Tustin”]at such time as demolition of the
buildings on the Property containing LBP has been completed and the appropriate
government regulatory agency(s) have confirmed in writing to the GRANTEE[“City of
Tustin”]that LBP has been removed from the buildings and any necessary soil
remediation has been conducted in accordance with all applicable federal, state, and
local laws and regulations. This Notice of Release shall be deemed to remove all notices
and restrictions relating to LBP from the Property. The GRANTOR[“Government”]
shall have no obligation under this subparagraph for the demolition of buildings or the
removal of LBP or soil remediation related to such demolition or removal action.
NoticesAnd Covenants
2.6:
Notices: Hazardous Substance Notification
2.6.1.. Pursuant to 42 U.S.C.
§9620(h)(3)(A), and the provisions of 40 C.F.R. part 373, the GRANTOR
[“Government”] hereby gives notice that hazardous substances were stored for one year
or more, released or disposed of on the Property. The information contained in this
notice is required by regulations promulgated under Section120(h) of the
Comprehensive Environmental Response, Liability, and Compensation Act (CERCLA or
“Superfund”), 42 U.S.C.Section 9620(h).The GRANTOR [“Government”]has made a
complete search of its files and records concerning the Property. Based on that search,
the type and quantity of such hazardous substances, the time at which such storage,
release or disposal took place, to the extent such information is available, and a
description of the remedial action taken, if any,is contained in Exhibit “B.”
Grant of Covenant [CERCLA 42 U.S.C. Section 9620 (h)(3)(A)(ii)(I)]
2.6.2..
The GRANTOR [“Government”]covenants and warrants that all remedial action
necessary to protect human health and the environment with respect to any hazardous
substance remaining on the Property has been taken before the date of transfer.
Additional Remediation Obligation [CERCLA 42 U.S.C. Section 9620
2.6.3.
(h)(3)(A)(ii)(II)]
. The GRANTOR [“Government”]covenants and warrants that
GRANTOR [“Government”]shall conduct any additional remedial action found to be
necessary after the date of transfer for any hazardous substance existing on the Property
prior to the date of this Deed. This covenant shall not apply to the extent that the
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GRANTEE [“City of Tustin”]caused or contributed to any release or threatened release
of any hazardous substance, pollutant, or contaminant.
Access [CERCLA 42 U.S.C. Section 9620 (h)(3)(A)(iii)]
2.6.4.. In connection
with GRANTOR’S [“Government”]covenant in 2.6.3 above and in connection with
ongoing remediation on GRANTOR’S [“Government”]property adjacent to the
Property, GRANTEE [“City of Tustin”]agrees on behalf of itself, its successors and
assigns, as a covenant running with the land, that GRANTOR [“Government”], or its
officers, agents, employees, contractors and subcontractors, shall have the right, upon
reasonable notice to GRANTEE [“City of Tustin”], to enter upon the Property in any
case in which a response or corrective action is found to be necessary at such property
after the date of this deed,or such access is necessary to carry out a response action or
corrective action on adjoiningproperty. Neither GRANTEE [“City of Tustin”], nor its
successors and assigns, shall have any claim on account of such entries against the
United States or any of its officers, agents, employees, contractors or subcontractors.
The right to enter shall include the right to conduct tests, investigations and surveys,
including, where necessary, drilling, test-pitting, boring and other similar activities.
Such right shall also include the right to construct, operate, maintain or undertake any
other response or corrective action as required or necessary, including, but not limited to
monitoring wells, pumping wells and treatment facilities, and the installation of
associated utilities. In exercising these rights of access, except in case of imminent and
substantial endangerment to human health or the environment, the GRANTOR
[“Government”](1) shall give the GRANTEE [“City of Tustin”]reasonable notice of
any action to be taken related to such remedial or corrective actions on the Property, and
(2)make reasonable efforts to minimize interference with the on-going use of the
Property. Furthermore, the GRANTOR [“Government”]and GRANTEE [“City of
Tustin”]agree to cooperate in good faith to minimize any conflict between the necessary
environmental investigationand remediation activities and the GRANTEE’s [“City of
Tustin”]use of the Property. Any inspection, survey, investigation or other response,
corrective or remedial action undertaken by GRANTOR [“Government”]will, to the
maximum extent practical, be coordinated with representatives designated by the
GRANTEE [“City of Tustin”].
In connection with GRANTOR’s [“Government”]remedial actions described
above, GRANTEE [“City of Tustin”]agrees on behalf of itself, its successors and
assigns, as a covenant running with the land, to comply with the provisions of any health
or safety plan in effect duringthe course of any such action.
Indemnification Regarding Transferees
2.8. The GRANTOR [“Government”]
hereby recognizes its obligations under Section 330 of theNational Defense
Authorization Act of 1993 (Pub. L. 102-484), as amended, regarding indemnification of
transferees of closing Department of Defense property.
Non-Discrimination
2.9. GRANTEE [“City of Tustin”]covenants for itself, its
successors and assigns, that it will comply with all applicable provisions of the Civil
Rights Act of 1964, section 504 of the Rehabilitation Act of 1973, and the Age
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Discrimination in Employment Act of 1975 in the use, occupancy, sale or lease of the
Property. The foregoing shall not be construed to prohibit the operation of federal or
state approved programs focusing on the special needs of the homeless, veterans, victims
of domestic violence and other classes of persons at risk; nor shall it be construed to
prohibit employment practices not otherwise prohibited by law. The GRANTOR
[“Government”]shall be deemed a beneficiary of this covenant without regard to
whether it remains the owner of any land or interest therein in the locality of the Property
hereby conveyed and shall have the sole right to enforce this covenant in any court of
competent jurisdiction.
NO HAZARD TO AIR NAVIGATION
3.: GRANTEE [“City of Tustin”]covenants
for itself, its successors and assigns, that in connection with any construction or
alteration onthe Property, it will obtain a determination of no hazard to air navigation
from the Federal Aviation Administration in accordance with Title 14, Code of Federal
Regulations, part 77, entitled “Objects Affecting Navigable Airspace,” or under the
authorityof the Federal Aviation Act of 1958, as amended.
3.4The responsibilities and obligations placed upon the GRANTOR by the
Government shall run with the land and be binding on the GRANTEE and all subsequent owners
of theParcelsor any portion thereof, unless and until such responsibilities and obligations are
released pursuant to the provisions set forth in the Government Deed.
3.5As further set forth in, and subject to the terms and conditions of the DDA,
GRANTEE acknowledges that it has examined theParcelsand is buying theParcelsfrom the
GRANTOR in an “AS IS, WHERE IS, WITH ALL FAULTS” condition, in its present state and
condition and with all faults, which provisions shall survive the close of escrow related to this
transaction and do not merge with this Quitclaim Deed.
DDA Provisions
4..
Definitions
4.1.Pursuant to the DDA, the City has imposed certain covenants,
conditions and restrictions on the Parcel, including the releases contained in Section4.5.2 of the
DDA, which are set forth verbatim below in italics and each of which is hereby declared to be a
covenant running with the land in perpetuity. Within the italicized language which follows,
section references shall be to sections of the DDA and initially capitalized terms shall have the
meanings set forth in Exhibit “C”attached hereto and incorporated herein by this reference.
Except for the provisions set forth in Section 4.2and Exhibit “C”, the DDA shall not be binding
upon or burden any End User. An End User is defined to be any (a)Homebuyer who purchases
aresidential lot within the Land, (b) Homeowners’Association with respect to any common
areas within the Land conveyed to the Homeowners’Association and/or (c) utility or
Governmental Authority with respect to any transfer of portions of the Parcels or grants of
easements affecting the Parcels desirable for the development of the Parcels.
Releases
4.2.Section 4.5.2(f) and (g) of the DDA provides as follows:
(f)Release.Developer, on behalf of itself and each Successor Owner and every
Person claiming by, through or under Developer or any Successor Owner (each a
9
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Releasing Party
“”), hereby waives, as of the Effective Date, and agrees to waive, as
of the Close of Escrow, the right of each Releasing Party to recover from, and fully
and irrevocably releases, the City and its elected and appointed officials, employees,
agents, attorneys, affiliates, representatives, consultants, contractors, successors and
Released PartyReleased Parties
assigns (individually, a “” and collectively, the “”)
from any and all Claims that Developer or any Releasing Party may now have or
hereafter suffer or acquire arising from or related to: (i)any Due Diligence
Information, (ii) any condition of the Property or any current or future improvement
thereon, known or unknown by any Releasing Party or any Released Party, including
as to the extent or effect of any grading of the Development Parcels; (iii) any
construction defects, errors, omissions or other conditions, latent or otherwise;
(iv)economic and legal conditions on or affecting the Property or any improvements
thereon; (v) Environmental Matters, including the existence, Release, threatened
Release, presence, storage, treatment, transportation or disposal of any Hazardous
Materials at any time on, in, under, or from, the Property or any current or future
improvement thereon or any portion thereof; (vi)Claims of or acts or omissions to act
of any Governmental Authority or any other third party arising from or related to any
actual, threatened, or suspected Release of a Hazardous Material on, in, under, or
from or about the Property or any current or future improvement thereon, including
any Investigation or Remediation at or about the Property or any current or future
improvement thereon; and/or (vii)arising from the Tustin Legacy Backbone
Infrastructure Program, any community facilities district or assessment district the
cost or extent thereof, or the amount of the Project Fair Share Contribution or any
community facilities district or assessment district assessment against the
Development Parcels described in this Agreement or the DA; provided that the
foregoing release by the Releasing Parties shall not extend to the extent of (A) any
breach bythe City of any of the representations or warranties of the City set forth in
Sections 3.3 or 17.12 of this Agreement, (B) any breach by the City of any of the
covenants or obligations set forth in this Agreement or any Other Agreement, (C) any
Claim thatis the result of the gross negligence, willful misconduct or fraud of the City
or any of the Released Parties, (D) any actions of the City or any of the Released
Parties which occur following the Close of Escrow with respect to the Property, or (E)
any other Claims against City relating to or arising out of tort Claims brought by third
parties against Developer, to the extent such claims are based upon the Active
Negligence of the City or any Released Parties and Accruing prior to the Close of
Escrow; provided that the exceptions in clause (C) and (E) above shall not apply with
respect to any matter for which the City is indemnified pursuant to Section 5.5 or
Section 10.2. This release includes Claims of which Developer is presently unaware
or which Developer does not presently suspect to exist which, if known by Developer,
would materially affect Developer’s release of the Released Parties. Developer
specifically waives the provision of California Civil Code Section1542, which
provides as follows:
“A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS
WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO
EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING
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THE RELEASE, WHICH IF KNOWN BY HIM OR HER MUST
HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT
WITH THE DEBTOR.”
In thisconnection and to the extent permitted by law, Developer on behalf of itself,
and the other Releasing Parties hereby agrees that (x) it realizes and acknowledges
that factual matters now unknown to it may have given or may hereafter give rise to
Claims orcontroversies which are presently unknown, unanticipated and unsuspected,
(y) the waivers and releases in this Section 4.5.2(f) have been negotiated and agreed
upon in light of that realization and (z) Developer, on behalf of itself and the other
Releasing Parties, nevertheless hereby intends to release, discharge and acquit the
Released Parties from any such unknown Claims and controversies to the extent set
forth above.
BY INITIALING BELOW, DEVELOPER ACKNOWLEDGES
THAT (A)IT HAS READ AND FULLY UNDERSTANDS THE
PROVISIONS OF THIS SECTION, (B)IT HAS HAD THE
CHANCE TO ASK QUESTIONS OF ITS COUNSEL ABOUT ITS
MEANING AND SIGNIFICANCE, AND (C)IT HAS ACCEPTED
AND AGREED TO THE TERMS SET FORTH IN THIS SECTION.
_____________________________________________
CITY’S INITIALSDEVELOPER’S INITIALS
This release shall run with the land for the benefit of the City Benefited Property and
the City and each Successor Owner owning all or any portion of such City Benefited
Property from and after the acquisition of the Development Parcels by Developer,
burdening the Development Parcels and Developer and the Successor Owners owning
all or any portion of the Development Parcels and all Persons claiming by, through or
under Developer or any Successor Owner of the Development Parcels or such portion
thereof and to further evidence its effectiveness with respect to Developer and the
Successor Owners of the Development Parcels, shall be included in its entirety in the
Quitclaim Deed.
(g)The provisions of this Section 4.5.2 shallsurvive the Close of Escrow and the
termination of this Agreement and shall not be merged with the Quitclaim Deed.
5.This Quitclaim Deed is made and accepted upon (a) the covenants, conditions,
restrictions and other matters set forth in the Special Restrictions, which for the term of the
Special Restrictions areincorporated herein by reference with the same force and effect as
though fully set forth herein, and (b) subject to reservations, covenants and restrictions as set
forth in the Government Deed. Each future transfer or conveyance of theParcelor any portion
thereof shall include those disclosures and environmental covenants contained in the
Government Deed.
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6.The terms of this Quitclaim Deedare hereby agreed and declared by the GRANTEE and
the GRANTOR to be covenants running with the land and enforceable as restrictions and
equitable servitudes against theParcels, and are hereby declared to be and shall be binding upon
theParcelsand the GRANTEE and all successors and assigns of the GRANTEE owning all or
any portion of theParcelsfor the benefit of the City Benefited Property (legally described on
Exhibit “D”attached to this Quitclaim Deed and incorporated herein by this reference) and the
GRANTOR,and the GRANTOR shall retain the right to enforce the restrictions and equitable
servitudes against the Parcelsand the same shall be enforceable solely by the GRANTOR
notwithstanding any future transfer of the City Benefited Property or any interest therein or
portion thereof.
IN WITNESS WHEREOF, the GRANTOR, THE CITY OF TUSTIN, has caused this
Quitclaim Deed to be executed on the day first above written.
CITY OF TUSTIN:
Dated:
By:
Jeffrey C. Parker,
City Manager
ATTEST:
By:
Erica Rabe
City Clerk Services Supervisor
APPROVED AS TO FORM
By:
David Kendig,
City Attorney
Armbruster Goldsmith & Delvac LLP
Special Real Estate Counsel to the City
By:
Amy E. Freilich
{signatures continued on next page
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ACKNOWLEDGEMENT OF GRANTEE’S COVENANTS
BY EXECUTING THIS QUITCLAIM DEED BELOW, ON AND AS OF THE DATE
WRITTEN BELOW, GRANTEE HEREBY (A) ACKNOWLEDGESAND ACCEPTSthis
Quitclaim Deed and the covenants and agreementsof the GRANTEEcontained in this Quitclaim
Deedand (B)ACKNOWLEDGES AND ACCEPTS the Special Restrictions and assumesand
agrees to be bound by all of the obligations and liabilities, covenants, conditions,and restrictions
in the Special Restrictionswhich are the responsibility of the “Developer” thereunder.
Standard Pacific Corp.,
a Delaware corporation
By: ________________________
Name: ______________________
Title: ________________________
Dated: __________________
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STATE OFCALIFORNIA)
) ss.
COUNTY OF ORANGE)
On ______________________, before me,____________________________________ ,
DateHere Insert Name and Title of the Notary
personallyappeared ____________________________________________________________,
Name of Person executing document
who proved to me on the basis of satisfactory evidence to be the person whose name is
subscribed to the within instrument and acknowledged to me that he/she executed the same in
his/her authorized capacity, and that by his/her signature on the instrument the person, or the
entity upon behalf of which the person acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that
the foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Signature:_____________________________________
Signature of Notary Public
(SEAL)
STATE OF CALIFORNIA)
) ss.
COUNTY OF ORANGE)
On ______________________, before me,____________________________________ ,
DateHere Insert Name and Title of the Notary
personally appeared ____________________________________________________________,
Name of Person executing document
who proved to me on the basis of satisfactory evidence to be the person whose name is
subscribed to the within instrument and acknowledged to me that he/she executed the same in
his/her authorized capacity, and that by his/her signatureon the instrument the person, or the
entity upon behalf of which the person acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that
the foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Signature:_____________________________________
Signature of Notary Public
(SEAL)
Exhibit “A”
Legal Description ofParcels
Exhibit “B”
Description of the Remedial Action Takenby the Government
Exhibit “C”
DDA Definitions Applicable to Section 4.2 of the Quitclaim Deed
AccrueAccruing
“” or “” shall mean the transpiring of an act or occurrence or a failure to
act or occur pursuant to which a legally enforceable claim could be asserted by any Person.
Active Negligence
“” shall mean an affirmative act performed negligently and not a
failure to act.
Agreement
“” shall mean the DDAas defined in this Quitclaim Deed.
City
“” shall mean the Grantor as defined in this Quitclaim Deed.
City Benefited Property
“” shall mean the “City Benefited Property” as defined in this
Quitclaim Deed.
ClaimClaims
“” or “” shall mean any and all claims, actions, causes of action, demands,
orders, or other means of seeking or recovering losses, damages, liabilities, costs, expenses
(including attorneys’ fees, fees of expert witnesses, and consultants’ and court and litigation
costs), costs and expensesattributable to compliance with judicial and regulatory orders and
requirements, fines, penalties, liens, taxes, or any type of compensation whatsoever, direct or
indirect, known or unknown, foreseen or unforeseen.
Closing Date
“” shall mean the Effective Date of this Quitclaim Deed.
Developer
“” shall mean the Grantee pursuant to this Quitclaim Deed and all subsequent
owners of the Parcels or any portion thereof.
Development Parcels
“” shall mean the “Land” as defined in this Quitclaim Deed.
DA
“” shall mean the Development Agreement by and between Grantor and Granteewith
respect to the Parcels, which agreement was executed substantially concurrently with the
execution of the Quitclaim Deed and Recorded.
Due Diligence Information
“” shall mean any and allinformation or documentation
relating to the Property furnished to Grantee to Grantor, or its elected and appointed officials,
employees, agents, attorneys, affiliates, representatives, contractors or consultants, in connection
with Developer’s due diligence
Environmental Agency
” shall mean the United States Environmental Protection
Agency; the California Environmental Protection Agency and all of its sub-entities, including
any Regional Water Quality Control Board, the State Water Resources Control Board, the
DTSC, the South Coast Air Quality Management District, and the California Air Resources
Board; the City; any Fire Department or Health Department with jurisdiction over the Property;
and/or any other federal, State, regional or local governmental agency or entity that has or asserts
jurisdiction over Hazardous Substance Releases or the presence, use, storage, transfer,
C-1
Exhibit C to QuitclaimDeed
manufacture, licensing, reporting, permitting, analysis, disposal or treatment of Hazardous
Materials in, on, under, about, or affecting the Project.
Environmental Laws
“” shall mean any federal, state, regional or local laws, ordinances,
rules, regulations, requirements, orders, directives, guidelines, or permit conditions, in existence
as of the Effective Date or as later enacted, promulgated, issued, modified or adopted, regulating
or relating to Hazardous Materials, and all applicable judicial, administrative and regulatory
decrees, judgments and orders and common law, including those relating to industrial hygiene,
public safety, human health, or protection of the environment, or the reporting, licensing,
permitting, use, presence, transfer, treatment, analysis, generation, manufacture, storage,
discharge, Release, disposal, transportation, Investigation or Remediation of Hazardous
Materials. Environmental Laws shall include the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, as amended (42 U.S.C. Section9601, et seq.)
CERCLA
(“”); the Resource Conservation and Recovery Act, as amended, (42 U.S.C.
RCRA
Section6901 et seq.) (“”); the federal Water Pollution Control Act, as amended,
(33U.S.C. Section1251 et seq.); the Toxic Substances Control Act, as amended, (15 U.S.C.
Section2601 et seq.); the Hazardous Substances Account Act (Chapter6.8 of the California
Health and Safety Code Section25300 et seq.); Chapter 6.5 commencing with Section25100
(Hazardous Waste Control) and Chapter6.7 commencing with Section25280 (Underground
Storage of Hazardous Substances) of the California Health and Safety Code; and the California
Water Code, Sections13000 et seq.
Environmental Matters
“”shall mean (a) the environmental condition of the Property;
(b)the compliance of the Propertywith Environmental Laws; (c)the existence, Release,
threatened Release, presence, storage, treatment, transportation or disposal of any Hazardous
Materials at any time on, in, under, or from, the Propertyor any current or future improvement
thereon or any portion thereof, and/or (d)Claims of or acts or omission to act of any
Governmental Authority or any other third party arising from or related to any actual, threatened,
or suspected Release of a Hazardous Material on, in, under, or from, about, or adjacent to the
Propertyor any current or future improvement thereon, including any Investigation or
Remediation at or about the Propertyor any current or future improvement thereon.
Governmental Authorityand Governmental Authorities
“”“”shall mean, respectively,
each and all federal, State, county, municipal and local governmental and quasi-governmental
bodies and authorities (including the United States of America, the Stateand any political
subdivision, public corporation, district, joint powers authority or other political or public entity)
or departments thereof having or exercising jurisdiction over Grantor and Grantee, the Project,
the Property or such portions of the foregoing as the context indicates.
Hazardous Materials
“” shall mean and include the following:
Hazardous SubstanceHazardous MaterialHazardous Waste
(a)“”, “”, “”,
Toxic Substance
or “” under the Comprehensive Environmental Response, Compensation and
Liability Act of 1980, 42 U.S.C. subsection9601, et seq., the Hazardous Materials
Transportation Act, 49 U.S.C. subsection5101, et seq., or the Resource Conservation and
Recovery Act, 42 U.S.C. subsection6901, et seq.;
C-2
Exhibit C to QuitclaimDeed
Extremely Hazardous WasteHazardous Waste
(b)An “”, a “”, or a
Restricted Hazardous Waste
“”, under subsections25115, 25117, or 25122.7 of the California
Health and Safety Code, or is listed or identified pursuant to subsection25140 or 44321 of the
California Health and Safety Code;
Hazardous MaterialHazardous SubstanceHazardous Waste
(c)“”, “”, “”,
Toxic Air ContaminantMedical Waste
“”, or “” under subsections25281, 25316, 25501,
25501.1, 117690 or 39655 of the California Health and Safety Code;
OilHazardous Substance
(d)“” or a “” listed or identified pursuant to
Section311 of the Federal Water Pollution Control Act, 33 U.S.C. Section1321, as well as any
other hydro carbonic substance or by-product;
Hazardous WasteExtremely Hazardous
(e)Listed or defined as a “”, “
WasteAcutely Hazardous Waste
”, or an “” pursuant to Chapter 11 of Title 22 of the California
Code of Regulations;
(f)Listed by the State as a chemical known by the State to cause cancer or
reproductive toxicity pursuant to Section25249.8 of the CaliforniaHealth and Safety Code;
(g)A material which due to its characteristics or interaction with one or more
other substances, chemical compounds, or mixtures damages or threatens to damage, health,
safety, or the environment, or is required by any law or publicagency to be remediated,
including remediation which such law or public agency requires in order for the property to be
put to any lawful purpose;
(h)Any material whose presence would require remediation pursuant to the
guidelines set forth in the StateLeaking Underground Fuel Tank Field Manual, whether or not
the presence of such material resulted from a leaking underground fuel tank;
(i)Pesticides regulated under the Feral Insecticide, Fungicide and
Rodenticide Act, 7 U.S.C. subsection136 et seq.;
(j)Asbestos, PCBs and other substances regulated under the Toxic
Substances Control Act, 15 U.S.C. subsection2601 et seq.;
(k)Any radioactive material including any “source material”, “special nuclear
material”, “by-product material”, “low-level wastes”, “high-level radioactive waste”, “spent
nuclear fuel” or “transuranic waste”, and any other radioactive materials or radioactive wastes,
however produced, regulated under the Atomic Energy Act, 42U.S.C. subsection2011 et seq.,
the Nuclear Waste Policy Act, 42 U.S.C. subsection10101 etseq., or pursuant to the California
Radiation Control Law, California Health and Safety Code Section114960 et seq.;
(l)Regulated under the Occupational Safety and Health Act, 29U.S.C.
subsection651 et seq., or the California Occupational Safety and Health Act, California Labor
Code subsection6300 et seq.; and/or
C-3
Exhibit C to QuitclaimDeed
(m)Regulated under the Clean Air Act, 42 U.S.C. subsection7401 etseq. or
pursuant to Division 26 of the California Health and Safety Code.
Investigation(s)
“” shall mean any observation, inquiry, examination, sampling,
monitoring, analysis, exploration, research, inspection, canvassing, questioning, and/or surveying
of or concerning the Property, including the air, soil, surface water, and groundwater, and the
surrounding population or properties, or any of them, to characterize or evaluate the nature,
extent or impact of Hazardous Materials.
Person
“” shall mean an individual, partnership, limited partnership, trust, estate,
association, corporation, limited liability company, joint venture, firm, joint stock company,
unincorporated association, Governmental Authority, governmental agency or other entity,
domestic or foreign.
Project
“” shall mean the “Project” as defined in this Quitclaim Deed.
Project Fair Share Contribution
“” shall mean the fair share of the Tustin Legacy
Backbone Infrastructure Program required to be paid by the Grantee pursuant to the DDA.
Property
“” shall mean the “Parcels” as defined in this Quitclaim Deed.
Quitclaim Deed
“” shall mean this “Quitclaim Deed.”
RecordRecordationRecordingRecorded
“”, “”, “” and “” shall mean to record the
specified instrument, or the current or past recording of the specified instrument, in the official
records of Orange County California.
Release
“” (with respect to Hazardous Materials) shall mean any releasing, or threat of
releasing, spilling, leaking, pumping, pouring, emitting, emptying, discharging, injecting,
escaping, leaching, migrating, disposing, or dumping into the environment.
RemediateRemediation
“” or“” shall mean any response or remedial action as defined
under Section101(25) of CERCLA, and similar actions with respect to Hazardous Materials as
defined under comparable state and local laws, and any other cleanup, removal, containment,
abatement, recycling, transfer, monitoring, storage, treatment, disposal, closure, restoration or
other mitigation or remediation of Hazardous Materials or Releases required by any
Environmental Agency or within the purview of any Environmental Laws.
Successor Owner
“” shall mean shall mean with respect to the Parcels, each and every
Person owning or acquiring fee title to all or any portion of the Parcelsandwith respect to the
City BenefitedProperty, each and every Person owning or acquiring fee title to all or any portion
of the City Benefited Property.
Tustin Legacy Backbone Infrastructure Program
“” shall mean the Tustin Legacy
Backbone Infrastructure Program in effect as of the Effective Date.
C-4
Exhibit C to QuitclaimDeed
Exhibit “D”
Legal Description of City Benefited Property
EXHIBIT D
UVTUJOMFHBDZ
DJUZCFOFGJUFEQSPQFSUZ
Attachment 12
ATTACHMENT 12
MEMORANDUM OF DDA
CITY OF TUSTIN OFFICIAL
BUSINESS REQUEST
DOCUMENT TO BE
RECORDED AND TO BE
EXEMPT FROM RECORDING
FEES PER GOVERNMENT
CODE §6103 AND §27383.
Recording requested by and
when recorded mail to:
City Manager
The City of Tustin
300 Centennial Way
Tustin, CA 92780
MEMORANDUM OF
TUSTIN LEGACY
DISPOSITION AND DEVELOPMENT AGREEMENT
FOR DISPOSITION PARCELS 1B& 6A
This MEMORANDUM OF TUSIN LEGACY DISPOSITION AND DEVELOPMENT
Memorandumof DDA
AGREEMENTFOR DISPOSITION PARCELS 1B & 6A (“”) is made
Memorandum Effective Date
as of ________, 2014(“”)by and among the CITY OF TUSTIN,
City
a municipal corporation of the State of California (the “”)and Standard Pacific Corp., a
Developer
Delaware corporation (the“”)to confirm that the City and Developerhave entered
into that certain Tustin LegacyDisposition and Development Agreementfor Disposition Parcels
DDA
1B&6A,dated as of _________________, 2014(the “”).The Cityand Developerare
PartyParties
sometimes referred to herein individually as a “” and collectively as the “.”
Capitalized terms used herein and not otherwise defined shall have the meanings ascribed to such
terms in the DDA.
1.Real Property Affected by the DDA.
1.1The Development Parcels.The property affected by the DDA consistsof the real
Development Parcels
property (the“”), legally described and depicted on Exhibit “A”attached
hereto and incorporated herein by reference,together with all existing improvements, if any,
presently located on the Development Parcels, all appurtenances pertaining to the Development
Parcels, all permits, licenses, approvals and authorizations issued by any Governmental Authority
relating to theDevelopment Parcels and all of City’s right, title and interest in, to and arising out
Property
of the Intangible Property as more fully described in the DDA (collectively, the “”)
.
1.2Quitclaim Deed. Immediately following the recordation of this Memorandum of
DDA, the Property shall be conveyed by the City to Developerpursuant to, among other
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conveyance instruments, that certain “QUITCLAIM DEEDFOR DISPOSITION PARCELS1B
AND6A AND COVENANTS, CONDITIONS AND RESTRICTIONS, INCLUDING
ENVIRONMENTAL RESTRICTION PURSUANT TO CIVIL CODE SECTION 1471”
Quitclaim Deed
(“”).
1.3Special Restrictions. This Memorandum of DDA has been executed as of the
Memorandum Effective Date and shall be recorded in the Office of the County Recorder, Orange
Official Records
County, California (the “”) immediately prior to the recordation in the Official
Records of (i) that certain Declaration of Special Restrictions for Disposition Parcels 1Band 6A
executed by the City and acknowledged by Developeraffecting the Development Parcels(the
Special Restrictions
“”), and (ii)the Quitclaim Deed. The DDA, this Memorandum of DDA, the
Special Restrictions and all covenants, conditions, restrictions and obligations set forth in the
Special Restrictionsand/or the Quitclaim Deed shall be binding upon the Development Parcels
and, unless and until terminated in accordance with their respective terms,shall govern the use
and development of the Property, the Development Parcelsand the Improvements by Developer.
2.Effect of the DDA. The DDA imposes certain obligations, agreements, covenants,
conditions and restrictions with respect to the Development Parcelsand with respect to
Developer’s acquisition, development, use, operation and ultimate disposition thereof, that run
with the Development Parcels, unless and until terminated in accordance with their respective
terms,as further set forth in the DDA. Among these obligations are the following:
(a)Certain restrictions onTransfer, conveyance and/or assignment of the
DDA and/or all or any portion of the Development Parcels, whether voluntary or involuntary,
and certain restrictions on the Transfer of Control of Developer contained in Section2of the
DDA, that terminate as to all of the Development Parcels upon execution and recordation by the
City of a Certificateof Compliance;
(b)Certain restrictions on Mortgages contained in Section 2.2.4of the DDA,
including without limitation, a prohibition on encumbrance of the Development Parcelswith any
Mortgage,which limitations terminate as to all of the Development Parcels upon execution and
recordation by the City of a Certificateof Compliance;
(c)The releases contained in Section4.5.2of the DDAthat remain in effectin
perpetuity;
(d)The indemnities set forth in Sections 5.5, 8.12(e), 8.15, 8.16, 10.1, 10.2
and 17.12.1 of the DDA shall (a) survive the Close of Escrow and shall not merge into the
Quitclaim Deed, (b)survive the sale of land to each End User and the issuance of the Notice of
Completion, and (c) until the date that is ten (10) yearsfollowing issuance of the Certificate of
Compliance, continue to bebinding upon Developer and Developer’s successors and assigns and
each and every prior Developer not released by the City, but shall not be binding on any End
User.
(e)The Right of Purchase in favor of the City, contained in Section16.3of
the DDA (copied verbatim below), that terminatesas to all Development Parcels upon execution
and recordation by the City of a Certificateof Compliance;and
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(f)The Right of Reversion in favor of the City contained in Section16.4of
the DDA(copied verbatim below), that terminates as to all of the Development Parcels upon
execution and recordation by the City of a Certificateof Compliance.
3.Effect of DDA onHomebuyers and OtherEnd Users.Notwithstanding anything to the
contrary set forth in this Memorandum of DDA, recognizing that the Development Parcels will
be subdivided and developed with the intent to sell individual residential Lots and/or Homes to
Homebuyers, thegeneral prohibition against Transfer outlined herein shall not be applicable to
(a) the sale of individual residential Lots and/or Homes to Homebuyers, or (b) the transfer of
Common Area or Common Area Improvements to a Homeowners’ Association;provided,
however, that sale ortransfer of any Lot or Home shall not be permitted unless and until such
Lot or Home is authorized for sale pursuant to State law, including regulations promulgated by
the California Bureau of Real Estateand the transfer of any Property to a Homeowner’s
Association shall not be permitted unless and until the Improvements proposed to be constructed
thereon pursuant to the Scope of Development, the Approved Plans and the CC&Rs have been
Completed.Except for the express provisions of the Quitclaim Deed, the DDA and the
obligations, covenants, conditions and restrictions set forth therein and in this Memorandum of
DDAshall notsurvive a Transfer to an End Userand upon such Transfer to an End User, shall
cease to run with the land Transferred to the End User, and each End User shall take title to the
property conveyed to it free and clear of the lien or charge of the DDA or this Memorandum of
DDA, except to the extent provided in the Quitclaim Deed. For ease of reference only, the
following definition of “End User” is copied verbatim from the DDA:
“End User”
shall mean any (a) Homebuyer who purchases a Lot/Home,
(b) Homeowners’ Association with respect to any Common Areas within the
Property conveyed to the Homeowners’ Association,(c) utility or Governmental
Authority with respect to any transfer of portions of the Property or grants of
easements affecting the Development Parcels desirable for the development of the
Development Parcelsand/or (d) any lighting or landscaping district.
4.Right of Purchase and Right of Reversion. For ease of reference only, the following
italicized Sections16.3 and 16.4arecopied verbatim from the DDA:
[insert text from right of purchase and right of reversionprior to close of escrow]
5.Certificateof Compliance.If Developersatisfies the Conditions Precedent set forth in
Section9.3of the DDA with respect to issuance of a Certificateof Compliancefor the
Development Parcels,then the City shall furnish Developerwith aCertificateof Compliance in
recordable form upon written requestby Developer.The Certificateof Compliance shall be
binding upon the Parties to this Memorandum of DDA, their successors and assigns, and shall be
deemed to be the City’s conclusive determination of satisfactory Completion of all of the
Improvements and compliance with all other conditions required by the DDA, subject only to
such continuing terms of the DDA and/or the covenants, conditions, restrictions and obligations
set forth in the Special Restrictionsandthe Quitclaim Deed, each of which shall survive in
accordance with its respective terms.Developer, on behalf of itself and its successors and assigns
hereby consents to the recordation of the Certificate of Compliance against the entirety of the
Property, notwithstanding that portions of all of the Property may have been transferred prior
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thereto to third parties, including Homebuyers or to a Homeowners’ Association, and confirms
that no further acknowledgement or consent by the then-owners of the Property shall be required
in connection with such recordation. For ease of reference only, the following italicized Section
9.7iscopied verbatim from the DDA:
[insert text from Section 9.7 of DDAprior to close of escrow]
6.DDA and Memorandum of DDA Run With the Land.Subject to Section 3 above, the
DDA and this Memorandum of DDA, including, without limitation, the provisionsof the DDA
recited and set forth above, and all other obligations, agreements, covenants, conditions and
restrictions set forth in the DDA and this Memorandum of DDA are hereby agreed to by
Developer and by the City to be covenants running with the land and enforceable as equitable
servitudes against the Development Parcelsand are hereby declared to be and shall be binding
upon the Development Parcelsand Developerand its successors and assigns (who may ownall
or any portion of the Development Parcels)for the benefit of the City and its successors and
assigns, subject to the effects of recordation of a Certificateof Compliance as provided for in
Section 5above.
7.Priority of DDA and Special Restrictions.This Agreement, including the Lien, the Right
of Purchase and the Right of Reversion contained herein, the Memorandum of DDA and the
Special Restrictions shall be superior in priority to all Mortgages, provided, however, this
Section 12.7 shall not apply to any Mortgages obtained by Homebuyers.
8.Lien Rights.The delinquent amount of any payments due underthe DDA,
together with any late charges or interest due on any such delinquent payment, reasonable
attorneys’ fees, experts’ fees and consultants’ fees and collection costs related to such delinquent
payment shall, to the greatest extent permitted by applicable law, be a lien and charge upon the
Property in favor of the City effective upon Recordation of the Memorandum of DDA,which
lien and charge shall be paramount to the lien and charge of any Mortgage upon the Property.
Upon conveyance of any portion of the Development Parcels to an End User, the City Lien shall
automatically terminate as to such conveyed portions, provided however, that the termination of
such City Lien shall not terminate the obligations of Developer to City with respect to amounts
due and secured by such lien, which shall remain an ongoing obligation of Developer.
9.Acknowledgment and Assumption by Developer. By acceptance of the Quitclaim Deed
and Special Restrictionsand upon recording of the Quitclaim Deed, Special Restrictions and this
Memorandum of DDA,Developerhereby acknowledges and assumes all responsibilities placed
uponDeveloperunder the terms of the DDA.
10.Public Documents. The documents constituting the DDA are public documents and may
be reviewed at the official offices of the City.
11.Interpretation; Notice. This Memorandum of DDA is prepared for recordation and notice
purposes only and in no way modifies the terms, conditions, provisions and covenants of the
DDA. In the event of any inconsistency between terms, conditions, provisions and covenants of
this Memorandum of DDA and the DDA, the terms, conditions, provisions and covenants of the
DDA shall prevail.
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12.Attachments. The Attachments attached to this Memorandum of DDA are hereby
incorporated by this reference into this Memorandum of DDA as though fully set forth in this
Section.
{signatures on next page}
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Attachment 12 Memorandum of DDACity of Tustin/Standard Pacific
Tustin Standard Pacific Memo of DDA 1-28-2014.docxJanuary 28, 2014
IN WITNESS WHEREOF, the City and Developerhave executed this Memorandum of
DDA as of the Memorandum Effective Date.
CITY OF TUSTIN:
Dated:
By:
Jeffrey C. Parker,
City Manager
ATTEST:
By:
Erica Rabe
City Clerk Services Supervisor
APPROVED AS TO FORM
By:
David Kendig,
City Attorney
Armbruster Goldsmith & Delvac LLP
Special Real Estate Counsel to the City
By:
Amy E. Freilich
DEVELOPER:
Standard Pacific Corp., a Delaware
corporation
By:
Name:______________________
Title: ______________________
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Attachment 12 Memorandum of DDACity of Tustin/Standard Pacific
Tustin Standard Pacific Memo of DDA 1-28-2014.docxJanuary 28, 2014
STATE OF CALIFORNIA)
) ss.
COUNTY OF ORANGE)
On ______________________, before me,____________________________________ ,
DateHere Insert Name and Title of the Notary
personally appeared ____________________________________________________________,
Name of Person executing document
who proved to me on the basis of satisfactory evidence to be the person whose name is
subscribed to the within instrument and acknowledged to me that he/she executed the same in
his/her authorized capacity, and that by his/her signature on the instrument the person, or the
entity upon behalf of which the person acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that
the foregoing paragraph is true and correct.
WITNESSmy hand and official seal.
Signature:_____________________________________
Signature of Notary Public
(SEAL)
7
Attachment 12 Memorandum of DDACity of Tustin/Standard Pacific
Tustin Standard Pacific Memo of DDA 1-28-2014.docxJanuary 28, 2014
STATE OF CALIFORNIA)
) ss.
COUNTY OF ORANGE)
On ______________________, before me,____________________________________ ,
DateHere Insert Name and Title of the Notary
personally appeared ____________________________________________________________,
Name of Person executing document
who proved to me on the basis of satisfactory evidence to be the person whose name is
subscribed to the within instrument and acknowledged to me that he/she executed the same in
his/her authorized capacity, and that by his/her signature on the instrument the person, or the
entity upon behalf of which the person acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that
the foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Signature:_____________________________________
Signature of Notary Public
(SEAL)
STATE OF CALIFORNIA)
) ss.
COUNTY OF ORANGE)
On ______________________, before me,____________________________________ ,
DateHere Insert Name and Title of the Notary
personally appeared ____________________________________________________________,
Name of Person executing document
who proved to me on the basis of satisfactory evidence to be the person whose name is
subscribed to the within instrument and acknowledged to me that he/she executed the same in
his/her authorized capacity, and that by his/her signature on the instrument the person, or the
entity upon behalf of which the person acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that
the foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Signature:_____________________________________
Signature of Notary Public
(SEAL)
8
Attachment 12 Memorandum of DDACity of Tustin/Standard Pacific
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Exhibit “A”
Development ParcelsLegal Description
[insert legal description]
9
Attachment 12 Memorandum of DDACity of Tustin/Standard Pacific
Tustin Standard Pacific Memo of DDA 1-28-2014.docxJanuary 28, 2014
Attachment 13
ATTACHMENT 13
Attachment 14
PROFIT PARTICIPATION AGREEMENT
BETWEEN
CITY OF TUSTIN
City
(as “”)
AND
STANDARD PACIFIC CORP.,
a Delaware corporation
Developer
(as “”)
PROFIT PARTICIPATION AGREEMENT
THIS PROFIT PARTICIPATION AGREEMENT (this “Agreement”) is made as of
_________________, 2014, by and between CITY OF TUSTIN(“City”), and STANDARD
PACIFIC CORP., a Delaware corporation (“Developer”)(collectively, the “Parties” and
individually, a “Party”).
RECITALS:
A.Pursuant to that certain Tustin Legacy Disposition and Development Agreement
for Disposition Parcels1B & 6Adated as of ________ __, 2014, by and between Cityand
Developer, as may be amended from time to time (“DDA”), Developerhas acquiredfrom City
certain real property located in the unincorporated area of the City of Tustin, County of Orange,
State of California, more particularly described in Exhibit “A” attached hereto (“Development
Parcels”).
B.As additional consideration for the purchase of the Property, and in addition to the
purchase pricepayable under the DDA,Developerhas agreed to pay to Citya certain portion of
the profits, if any, that will be received by Developerfrom the sale of Residences(as defined
below) within the Propertyin accordance withthe terms and conditions set forth below.
AGREEMENT:
NOW, THEREFORE, in consideration of the above and for other good and valuable
consideration, thereceipt of which is hereby acknowledged, the Parties agree as follows:
1.Definitions. Capitalized terms used in this Agreement and not defined below or
elsewhere in this Agreement shall have the meanings set forth in the DDA.
1.1“Action” is defined in Section6.5.
1.2“Allowable Expenses”is defined in Section 2.2.
1.3“Audit”is defined in Section 4.1.
1.4“Bond” is defined in Section 3.1.
1.5“Builder” shall mean any permitted Builder Transferee (as defined in the
DDA) which purchases undeveloped Lots from Developer for thepurpose of constructing
Residencesthereon.
1.6Common Area” shall mean community facilities lot, parks, streets and
alleys or other common area as designated on any Final Tract Map.
1.7“Costs” is defined in Section 6.5.
1.8“DDA”is defined in Recital A.
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1.9“Decision” is defined in Section 6.5.
1.10“Default” is defined in Section 5.1.
1.11“DeveloperProfitability Report” shall mean a report to be submitted by
Developerin the form of “Exhibit B” attached hereto.
1.12“Final Accounting” is defined in Section 3.3.
1.13“Final Sale” is defined in Section 3.2.
1.14“Final Tract Map” shall mean the final map recorded pursuant to Vesting
Tentative Tract Map No. 17507.
1.15“Gross Revenue” shall mean the Gross Sale Price less the dollar amount of
any Sale Incentives.
1.16“Gross Sales Price”shall mean and refer to the total consideration actually
received by Developerin connection with the sale of Residencesto members of the home-buyer
public, including any Premiums and prices for Options and Upgrades.
1.17“Interim Payment”is defined in Section 3.1.
1.18“Invested Cash” is defined in Section 2.2.
1.19“Lot”shall mean those lots shownon a final subdivision map covering the
Propertywhich are actually acquired by Developerand upon which a Residenceis entitled to be
constructed, but shall specifically exclude Common Area. “Model Lots” shall mean six Lots
identified on a final subdivision map covering the Propertyas Lots 263 through 268 on which
Developerintends to construct model Residences.
1.20“Net Profits”is defined in Section 2.2.
1.21“Options and Upgrades”shall mean and refer to floor plan modifications
or special or upgraded amenities or appliances sold by Developerfor a Residence. Without
limiting the generality of the foregoing, Options and Upgrades would include room options,
appliance upgrades, cabinetry upgrades, countertop upgrades, finish carpentry upgrades,
electrical options, fireplace options, paint upgrades, any exterior options, and landscaping
options and upgrades.
1.22“Options and Upgrades Costs”shall mean and refer to the actual costs
incurred by Developerfor Options and Upgrades for each Residence.
1.23“Premiums” shall mean all premiums charged by Developerin connection
with the sale of any Residencewithin the Property, including, without limitation, any premium
for location or elevation of the Residence, for the view available from the Residenceor for any
other feature applicable to the Residence.
1.24“Profit Participation”is defined in Section 2.1.
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1.25“Project”shall mean Developer’s development of the Lots on the Property
it acquires, together with any related off-site and on-site improvementsand any Common Area
facilities or improvements. The Project is anticipated to include 375 residential Lots.
1.26“Property”shall mean the Development Parcels defined in Recital A with
the exception of any property re-acquired by City pursuant to the terms and provisions of the
DDA.
1.27“Residences” shall mean the residential dwelling unit that is constructed
by Developer on a Lot acquired by Developer within the Property.
1.28“Sales Incentives”shall mean allowances, credits and the like made by
Developerto purchasers of the Residencesas an inducement to purchase the Residences(such as
free Options and Upgrades, Developerpayment of purchaser closing costs, allowances and
prepayments of assessments, special taxes and charges).
1.29“Second Interim Payment” is defined in Section 3.2.
1.30“Transferee” shall mean any permitted assignee of Developer (i.e., an
assignee approved by the City pursuant to the Disposition and Development Agreement) other
than a Builder which acquires or purchases all or any portion of the Development Parcels from
Developer.
2.Profit Participation.Developeragrees to pay to City, at the time and in the
manner specified below, the amount of the “Profit Participation” (as defined below).
2.1Calculation of Profit Participation.“Profit Participation” shall mean 50%
of the amount by which the total Net Profits exceed 8.50% of the Gross Sales Price received by
Developer.
2.2Net Profits. “Net Profits” for purposes of this Agreement shall be defined
to be the Gross Revenues less the following allowable deductions (collectively, “Allowable
Expenses”), provided that notwithstanding that certain categories below are overlapping, there
shall be no double-counting of expenses incurred by Developer:
(a)Land Acquisition Cost. Thetotalpurchase priceand any other
considerationpaid to theCityunder theDDA.
(b)Land Acquisition Transaction Costs. The third-party out-of-pocket
transaction costs directly related to acquiring the Propertyfrom City, such as escrow, title
insurance and endorsements, legal fees, easement costs, due diligence costs,market studies,
consultant fees, and costs of third party reports and studies.
(c)Site Improvement and Entitlement Costs. On-site and off-site
improvement costs actually expended for the Project for engineering, consultants, bonds,
grading, wet utilities, dry utilities, street improvements, walls and fences, landscaping, and
common area and recreational facilities, and allcosts to obtain, alter or amend any entitlements
for the Project or to record the any tract map or Final Map.
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(d)Indirect Construction. Indirect construction costs actually
expended for the Project, including, but not limited to, permits and fees, architecture,
engineering, inspections, construction supervision, construction trailer, security, repair and
replacement,and other on-site costs associated with the construction of the Project.
(e)Direct Construction. The actual costs of construction materials,
equipment rental, labor and subcontractors for the construction of Residencesand any Common
Areas.
(f)Cost of Funds.Interest at the rate of eight and eight-tenthspercent
(8.8%) per annum on the Invested Cash (defined below) outstanding from time to time,
compounded monthly.
For purposes of this Section, “Invested Cash” shall mean the cumulative cash outflows
for all Allowable Expenses regardless of the source of funds less Gross Revenues received. All
calculations shall be made based on accounting for all cash outflows of Allowable Expenses
from the date of payment and all cash inflows of Gross Revenues fromthe date of receipt of
cash. For this purpose, the cash outflows for Section 2.2(k) (Overhead Allocation) shall be
deemed to occur for each Residenceat the start of construction for such Residenceand
Section2.2(m) (Warranty Allocation) and Section 2.2(j) (Insurance Allocation) shall be deemed
to occur for each Residenceupon the date of transfer of such Residenceto a member of the
homebuying public.
(g)PropertyTaxes. Costs of property taxes and assessments on the
Propertyacquired by Developer,and all other assessments paid in connection with community
facility districts, landscape maintenance districts and any other public financing districts charged
with respect to the Property.
(h)Model and Marketing Costs. Actual costs of model decorating,
model landscaping, model refurbishing, sales office, utilities and supplies, sales salaries,
maintenance, signage, and marketing and advertising costs which are directly related to the
marketing and sale of the Residences, and all actual internal and external sales commissions
paid.
(i)HOA Fees and Costs. Third party costs actually incurred in the
setup of a homeowners association with respect to the Property, including association dues,
subsidy payments, and legal fees.
(j)Insurance. An agreed amount equal to onepercent (1.0%) of the
Gross Sales Price of each Residenceto compensate Developerfor insurance costs related to the
Project.
(k)Overhead Allocation. An agreed amount equal to threeand one-
half percent(3.5%)of the Gross Sales Price to compensate Developerforits overhead in
connection with the development of the Project for costs not specifically allocated to the Project
such as: payroll additives and salaries of Developer’s corporate and division office executives,
officers, department heads and staff in directing, administering and supervising such
development; employee bonuses (excluding bonuses paid to field superintendents that are
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Attachment 14 Profit Participation Agreement City of Tustin/Standard Pacific
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directly allocable to the Project); general legal and accounting fees; and the operating expenses
of Developer’s corporate and division offices such as rent, utilities, office supplies, office
equipment and other office related expenses. This allocation is made at the start of construction
of each Residence.
(l)Sales Expense. All actual closing costs and charges incurred in
connection with the sale of any portion of the Project, including all escrow fees, title fees, and
transfer taxes.
(m)Warranty Allocation. An agreed amount equal to onepercent
(1.0%) of the Gross Sales Price of each Residenceto compensate Developerfor warranty costs
related to the Project.
(n)Options and Upgrades. All Options and Upgrades Costs.
(o)Design Center. An agreed amount equal to Five Thousand Dollars
($5,000) per Residencefor design center cost.
(p)Legal and Professional. Costs for legal and other professional fees
incurred in connection with the Project.
(q)Liquidated Damages. The amount of any CFD Liquidated
Damages actually paid to the City pursuant to Section 16.7 of the DDA.
(r)Other Allocable Costs. Any other actual costs properly and
directly allocable specifically to the development, construction, maintenance, repair and sale of
the Project, and not to any other project or property, but specifically excluding costs of the type
described in clauses (j) and (k) over the allowable percentage.
Allowable Expensesshall be allocated to each specific Residencein accordance with
Developer’s ordinary operating and accounting procedures. Where Allowable Expenses cannot
reasonably be allocated to a specific Residence, they shall be allocated to all of the Residences
pro-rata by dividing such expenses equally by the total number of Residences.
2.3Exclusions from Allowable Expenses.Allowable Expensesshall
specifically exclude any and all costs of Developer andanyTransferee and/or Builderassociated
with the sale, assignmentor transfer of the Propertyor any portion thereof by Developer to any
Transferee and/orBuilderand any and all costs of any Transferee or Builder in connection with
due diligence, entitlementor conveyance, including without limitation,any consideration paid by
any Transferee or Builder to acquire the Propertyor any portion thereof.For purposes of clarity,
it is the intent of the Parties that there shall be no adjustment to land basis or increase in
Allowable Expenses as the result of any sale or transfer to a Transferee or Builder, and the City’s
right to Profit Participation shall not be diluted or decreased as a result of the sale or assignment
of any Lots or other portion of the Propertyto any Transferee or Builder. The proceeds of any
sale, assignment or Transfer of the Property or any portion thereof by Developer to any
Transferee or Builder shall be excluded from the calculation of Gross Sales Price.
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3.Payment of Profit Participation.
th
3.1Interim Payment.Withinthirty (30) days following the sale of the 350
Residencewithin the Project, Developershall complete and submit to City an interimDeveloper
Profitability Report setting forth the calculation of Profit Participationas of the date of such
report, including all Gross Revenues, Sales Incentivesand Allowable Expensesby category and
the Profit Participation with respect to the 350Residencessold. Concurrently with submission
of such interim report, Developer shall provide (a) an interim payment of Profit Participation
(“Interim Payment”) in an amount equal to 75% of the ProfitParticipationbased upon the sale of
the 350 Residences, if any, and (b) apayment bond (“Bond”) in an amount equal to 25% of the
Profit Participation based upon the sale of the 350 Residences (the “Bond Amount”) from a
surety reasonable acceptable to City, and in form reasonably acceptable to City,to secure
Developer’sobligationsto pay the remaining Profit Participation, if any,pursuant to Section 3.2
and 3.3.The interim DeveloperProfitability Report shall calculate the Profit Participation based
upon the information available at such time, and mayinclude estimated reserves for any
undetermined or future Allowable Expenses.
3.2FinalDeveloperProfitability Report.Within thirty (30) days following
the sale of the 375thResidencein the Project (the “Final Sale”)(provided that to the extent that
the Developer determines to develop fewer than 375Residences, the Final Sale shall consist of
the close of escrow for the last Residenceto be developed at the Project),Developershall
complete and submit to City a DeveloperProfitability Report for the entire Project. Such
DeveloperProfitabilityReport shall calculate the Profit Participation for the entire Project based
upon the information available at such time, and shall include estimated reserves for any
undetermined or future Allowable Expenses. Concurrently with such DeveloperProfitability
Report, Developershall pay to the City the Profit Participationcalculated in such Developer
Profitability Report, less the amount of the Interim Paymentmade to City.However, if the
amount of the Interim Payment made to Cityexceeds the aggregate amount of Profit
Participation for all of the Residences, then Citywill pay to Developerthe difference within sixty
(60) days after Developerdelivers the Building Profitability Report pursuant to this Section 3.2.
Immediately following City’s receipt of the DeveloperProfitability Report and if applicable, the
amount of the remaining Profit Participation, City shall release the Bond.In the event that the
Final Sale has not occurred by the date which is two (2) years following the date of the Interim
Payment, Developer shall prepare a Developer Profitability Report with respect to all of the
Residencessold through the date thereof and shall pay the City the amount of ninety percent
(90%) of the Profit Participation calculated with respect to all of the Residencessold to date, less
the amount of the Interim Payment made to the City (the “Second Interim Payment”).
Thereafter, upon the Final Sale, the Developer Profitability Report and payment of the Profit
Participation shall be paid to the City by calculating the total Profit Participation for the Project
less the amount of the Interim Payment and the Second Interim Payment made to the City.
3.3Final Accounting.By the later of the date that is twelve (12) months after
the Final Sale or the date that all of Developer’s or (if any portion of the Propertyis transferred
to Builder) Builder’s bonds posted for the Project have been exonerated, Developershall perform
a final accounting and true-up of the Profit Participation reconciling any additional items of
revenue or Allowable Expenses which were not included in the DeveloperProfitability Report
prepared after the Final Sale (the “Final Accounting”). If such accounting shows that Developer
6
Attachment 14 Profit Participation Agreement City of Tustin/Standard Pacific
Tustin Standard Pacific Profit Participation Agreement 1-31-2014January 31, 2014
has overpaid the Profit Participation for the Project, City shall refund such overpayment within
sixty (60) days of receiving noticethereof, and if Developerhas under paid the Profit
Participation for the Project, Developershall deliver such additional Profit Participation to City
within sixty (60) days of completion of the accounting.
3.4Financial Records and Statements of Developer.Developershall keep and
maintain, or cause to be kept and maintained, accurate financial books and records with respect
to the development of the Propertyas necessary to calculate the Profit Participation. If
Developer is a publicly traded company, such records (including those of the Builder, if
applicable) shall be kept in accordance with Developer’s standard accounting principles and
practicesand if not, shall be kept in accordance with GAAPand FASB.These financial books
and records shall include all supporting documentation relativeto Gross Revenues and
Allowable Expenses, and shall be maintained by Developerfor three (3) years after the Final
Sale. Developershall not be required to keep paper copies of invoices, charges and evidence of
Allowable Expenses incurred, or payments related thereto, but shall only be required to retain
evidence of such records as are customarily maintained in accordance with its normal accounting
records in the ordinary course of business. Developershall make all such books and records
available to City, or its representatives, at any time upon five (5) business days’ prior written
notice for City’s inspection and copying thereof.Such inspection,examination and copying
shall be made at such time and place as the Developermay reasonably designate provided that
the designated place must be at an office located in Orange County, California. Developershall
cooperate fully with City in making the inspection.
4.Audit.
4.1Generally. At the option of Cityand, except as set forth below, at City’s
cost, exercised by written notice to Developerdelivered by the City at any time following the
Final Sale through the date which is one (1) year after Developer’s delivery to the City of the
Final Developer Profitability Report,Citymay cause Developer’s books and records for the
Project tobe audited by an independent third-party certified public accountant licensed in the
State of California selected by City(but not one that is compensated based upon the results of the
audit or a percentage of collections)for the purpose of verifying the calculation of Net Profit,
Allowable Costs, Gross Sales Amount, Gross Revenues, Sales Incentives,Profit Participation,
and other factors used to determine Profit Participation, due Cityfor the Project (the “Audit”).
Developershall make available to the auditor atDeveloper’s business officein Orange County,
California,within thirty (30) days after notice of Audit, all of the books and records of Developer
for the Project which such auditor deems necessary or desirable for the purpose of performing
the Audit.Subject to the resolution of any dispute regarding the Audit, if it is properly
determined by the Audit that there was a deficiency in the amount of Profit Participation paidto
the City hereunder, or any overpayment of Profit Participation to the City by Developer, the
Developer shall pay to City the amount of the underpayment, or City shall pay to Developer the
amount of the overpayment, as applicable, within thirty (30) days after receipt of the results of
the Auditwith interest thereon at 8.8%.If the Audit properly determines that the amount of the
Profit Participation was underpaid by more thanthe greater of (i) three percent (3%) of the
aggregate Profit Participation for the Project, or (ii) One Hundred Thousand Dollars
($100,000.00), then Developer shall pay the actual costs and expenses incurred by the City to the
7
Attachment 14 Profit Participation Agreement City of Tustin/Standard Pacific
Tustin Standard Pacific Profit Participation Agreement 1-31-2014January 31, 2014
third party auditor in connection with the performance of the Audit. Any dispute regarding the
Audit or the result thereof shall be resolved pursuant to Section 7.8.
5.Default.
5.1Default. In the event that any Party hereto believes the other Party is in
breach of its obligations under this Agreement, such Party shall deliver written notice of such
alleged breach and the actions necessary to cure such breach to the other Party. Such Party shall
be in default under this Agreement if it has not cured the breach within thirty (30) days from the
receipt of such notice, or in the event that the breach is notreasonably susceptible or cure within
such thirty (30) day period, then if it has not commenced the cure of such breach within the thirty
(30) day period and diligently prosecuted the cure to completion, but in no event to exceed
ninety (90) days (“Default”)
5.2Remedies. In the event of a Default by either Party hereunder, either Party
shall have all rights and remedies available to it at law or in equity. To the maximum extent
permitted by law, all rights, options and remedies contained in this Agreement, or under law,
shall be cumulative, and no one remedy shall be exclusive of any other remedy.
Notwithstanding the foregoing, each Party hereby waives the right to recover consequential,
special or punitive damages.
5.3Recordation of Deed of Trust. Concurrentlywith the acquisition of the
Development Parcels by Developer,Developershall execute, acknowledge and permit to be
recorded against the Model Lotsafirst lien Deed of Trust in the form attached hereto as Exhibit
“C”(the “Deed of Trust”) to secure payment of the ProfitParticipation.City shallexecute,
acknowledge and deliver to Developera full reconveyance of the Deed of Trust and such other
documentation as may be reasonably required in order to release the Deed of Trust as an
encumbrance upon the ModelLotsconcurrent with Developermaking the Interim Payment and
delivering the Bond to City pursuant to Section3.1.
6.Miscellaneous.
6.1Notices.All notices, demands, consents, requests and other
communications required or permitted to be given under this Agreement shall be in writing and
shall be deemed conclusively to have been duly given (a) when hand delivered to the other Party;
(b) three (3) Business Days after such notice has been sent by U.S. Postal Service via certified
mail, return receipt requested, postage prepaid, and addressed to the other Party as set forth
below; (c) the next Business Day after such notice has been deposited with an overnight delivery
service reasonably approved by the Parties (Federal Express, Overnite Express, UnitedParcel
Service and U.S. Postal Service are deemed approved by the Parties), postage prepaid, addressed
to the Party to whom notice is being sent as set forth below with next-business-day delivery
guaranteed, provided that the sending Party receives a confirmation of delivery from the delivery
service provider; or (d) when transmitted if sent by facsimile transmission or email to the fax
number or email address set forth below; provided that notices given by facsimile or email shall
not be effective unless either (i) a duplicate copy of such notice is promptly sent by any method
permitted under this Section other than by facsimile or email (provided that the recipient Party
need not receive such duplicate copy prior to any deadline set forth herein); or (ii)the receiving
8
Attachment 14 Profit Participation Agreement City of Tustin/Standard Pacific
Tustin Standard Pacific Profit Participation Agreement 1-31-2014January 31, 2014
Party delivers a written confirmation of receipt for such notice either by facsimile, email or any
other method permitted under this Section. Any notice given by facsimile or email shall be
deemed received on the next Business Day if such notice is received after 5:00 p.m. (recipient’s
time) or on a non-Business Day. Unless otherwise provided in writing, all notices hereunder
shall be addressed as follows:
If to City,City of Tustin
300 Centennial Way
Tustin, CA 92780
Attn: Jeffrey C. Parker, City Manager
Telephone: 714-573-3010
Facsimile: 714-834-1602
with a copy to:Woodruff Spradlin & Smart, APC
555 Anton Boulevard, #1200
Costa Mesa, CA 92626
Attn: David Kendig, Esq., City Attorney
Telephone: 714-415-1083
Facsimile: 714-415-1183
If to Developer,Standard Pacific Corp.
15360 Barranca Parkway
Irvine, CA 92618
Attn: Ted McKibben
Telephone No.: 949-789-1742
Facsimile: 949-789-1745
with a copy to:Rutan & Tucker, LLP
611 Anton Blvd., Suite 1400
Costa Mesa, California 92626
Attention: F. Kevin Brazil, Esq.
Telephone No.: 714-641-3462
Facsimile: 714-546-9035
Either Party may change the address to which notices are to be given to it by giving notice of
such change of address in the manner set forth above for giving notice.
6.2Interpretation. This Agreement shall be construed as if prepared by both
Parties. Accordingly, any rule of law (including California Civil Code Section 1654) or legal
decision that would require interpretation of any ambiguities in this Agreement against the Party
that has drafted it is not applicable and is waived.
6.3Severability.If any provision of this Agreement, or the application
thereof, shall for any reason and to any extent be invalid or unenforceable, the remainder of this
Agreement and application of such provision to other circumstances, shall be interpreted so as
best to reasonably effect the intent of the Parties hereto.
9
Attachment 14 Profit Participation Agreement City of Tustin/Standard Pacific
Tustin Standard Pacific Profit Participation Agreement 1-31-2014January 31, 2014
6.4Performance of Acts on Business Days. Unless specifically stated to the
contrary, all references to days herein shall be deemed to refer to calendar days. In the event that
the final date for paymentof any amount or performance of any act hereunder falls on a
Saturday, Sunday or holiday, such payment may be made or act performed on the next
succeeding business day.
6.5Attorneys’ Fees.If any Party to this Agreement institutes any action, suit,
proceeding, counterclaim or other proceeding for any relief against another Party, declaratory or
otherwise (collectively an “Action”), to enforce the terms hereof or to declare rights hereunder or
with respect to any inaccuracies or material omissions in connection with any of the covenants,
representations, warranties or obligations on the part of the other Party to this Agreement, then
the Prevailing Party in such Action shall be entitled to have and recover of and from the other
Party all costs and expenses of the Action, including (a) reasonable attorneys’ fees which shall be
payable at the contractual hourly rate for City’s litigation counsel at the time the fees were
incurred, but in no event less than $200 per hour and (b) costs actually incurred in bringing and
prosecuting such Action and/or enforcing any judgment, order, ruling or award (collectively, a
“Decision”) granted therein, all of which shall be deemed to have accrued on the commencement
of such Action and shall be paid whether or not such Action is prosecuted to a Decision. Any
Decision entered in any final judgment shall contain a specific provision providing for the
recovery of all costs and expenses of suit, including reasonable attorneys’ fees and expert fees
and costs (collectively “Costs”) incurred in enforcing, perfecting and executing such judgment.
For the purposes of this paragraph, Costs shall include in addition to Costs incurred in
prosecution or defense of the underlying action, reasonable attorneys’ fees, costs, expenses and
expert fees and costs incurred in the following: post judgment motions and collection actions,
contempt proceedings,garnishment, levy, debtor and third party examinations,discovery,
bankruptcy litigation and appeals of any order or judgment. “Prevailing Party”within the
meaning of this Section 6.5includes a Party who agrees to dismiss an Action in consideration for
the other Party’s payment of the amounts allegedly due or performance of the covenants
allegedly breached, or obtains substantially the relief sought by such Party.
6.6Entire Agreement; Amendments. This Agreement, together with the other
written agreements referred to herein, is intended by the Parties to be the final expression of their
agreement with respect to the subject matter hereof, and is intended as the complete and
exclusive statement of the terms of the agreement between the Parties. As such, this Agreement
supersedes any prior understandings between the Parties, whether oral or written. Any
amendments to this Agreement shall be in writing and shall be signed by all Parties hereto.
6.7Governing Law. This Agreement and the documents in the forms attached
as exhibits hereto shall be governed by and construed under the internal laws of the State of
California.
6.8Jurisdiction. The Parties hereto agree that the State Courts located in
Orange County, California (“Court”) shall have exclusive jurisdiction over any Actionand the
Parties hereby consent to the exercise of personal jurisdiction over them by the Court for
purposes of resolving the Action. Any Party may file a complaint with the Court, and in no other
court.
10
Attachment 14 Profit Participation Agreement City of Tustin/Standard Pacific
Tustin Standard Pacific Profit Participation Agreement 1-31-2014January 31, 2014
6.9No Waiver. No delay on the part of any Party hereto in exercising any
right, power or privilege hereunder shall operate as a waiver thereof, nor shall any waiver on the
part of anyParty hereto of any right, power or privilege hereunder operate as a waiver of any
other right, power or privilege hereunder, nor shall any single or partial exercise of any right,
power or privilege hereunder, preclude any other or further exercise thereof orthe exercise of
any other right, power or privilege hereunder.
6.10Assignment.In the event that the Property(or that portion thereof
remaining unsold to members of the home-buying public) is conveyed by Developerto any
successor owner, Developershall assign its right and obligations under this Agreementto such
successor owner of the Project, provided, however, upon such assignment of Developer’s rights
and obligations hereunder to a successor owner of the Project, Developershall only bereleased
from theobligations arising under this Agreement accruing after such assignmentto the extent
that Developer is released from its obligation under the DDA pursuant to the terms of Section2.2
of the DDA.Nothing in this Agreement shall modify the obligation of Developer to obtain the
consent of the City to any conveyance, transfer or assignment to the extent required by the DDA.
6.11Binding Effect. This Agreement shall be binding upon and inure to the
benefit of the Parties hereto and their respective heirs, representatives, successors and permitted
assigns.
6.12Headings; Cross-References; Exhibits. The headings and captions used in
this Agreement are for convenience and ease of reference only and shall not be used to construe,
interpret, expand or limit the terms of this Agreement.
6.13No Partnership.No agency, partnership, joint venture or other
relationship is intended hereby, and neither Party shall be deemed the agent, servant, employee,
partner or joint venturer of the other Party. Cityand Developershall not, in any way or for any
reason be deemed to have become a partner of the other in the conduct of its business or
otherwise, or a joint venturer. In addition, no merger or joint enterprise between Developer and
City shall be deemed to exist by virtue of this Agreement.
[signatures on next page]
11
Attachment 14 Profit Participation Agreement City of Tustin/Standard Pacific
Tustin Standard Pacific Profit Participation Agreement 1-31-2014January 31, 2014
IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be executed
as of the day and year first above written.
CITY:DEVELOPER:
CITY OF TUSTINSTANDARD PACIFIC CORP.,
a Delaware corporation
By:By:
Its:
Name: Jeffrey C. Parker
Title: City Manager
By:
Its:
APPROVED AS TO FORM
By:_________________________________
David Kendig, City Attorney
Armbruster Goldsmith & Delvac LLP
Special Tustin Counsel
By:_________________________________
Amy E. Freilich
12
Attachment 14 Profit Participation Agreement City of Tustin/Standard Pacific
Tustin Standard Pacific Profit Participation Agreement 1-31-2014January 31, 2014
EXHIBIT “A”
DESCRIPTION OF PROPERTY
A-1
EXHIBIT “B”
DEVELOPERPROFITABILITY REPORT
Date:
Developer:
Project:
Phases:
This PhaseThis PhaseCumulativeCumulative
Per UnitTotalPer UnitTotal
Number of Residences
Base Square Footage
Base Gross Sales Price
Lot Premiums
Option & Upgrades
Incentives
Total Sales Price
Land Acquisition
Transaction Costs
Site Improvement
Common Area & Fencing
Indirect Construction
Direct Construction
Overhead Allocation@
3.5.%
Cost of FundsAllocation
PropertyTaxes & HOA
Legal
Models & Marketing
Sales Expense
Options & Upgrades
Warranty Allocation@ 1%
Insurance @ 1%
Design Center @ $5,000 per
Residence
Other Allocable Costs
Total Development Costs
Net Profit
DeveloperProfit @ 8.50%
Excess Profit
CityParticipation @ 50%
CityParticipation Paid
CityParticipation Payable
B-1
Exhibit B to Profit Participation Agreement
EXHIBIT “C”
DEED OF TRUST
RECORDING REQUESTED BY:
WHEN RECORDED MAIL TO:
Standard Pacific Corp.
15360 Barranca Parkway
Irvine, CA 92618
Attn: Ted McKibbin
SPACE ABOVE THIS LINE FOR RECORDER’SUSE
DEED OF TRUST WITH ASSIGNMENT OF RENTS
(SHORT FORM)
This DEED OF TRUST
is made as of ________________, 2014, between STANDARD
PACIFIC CORP., a Delaware corporation, herein called TRUSTOR, whose address is 15360
Barranca Parkway, Irvine, California 92618, FIRST AMERICAN TITLE INSURANCE
COMPANY, herein called TRUSTEE, and the CITY OF TUSTIN, herein called
BENEFICIARY.
WITNESSETH: That Trustor grants to Trustee in trust, with power of sale, that certain property
in the County of Orange, State of California, more particularly described on Exhibit “A”attached
hereto and made a part hereof (the “Property”), together with the rents, issues and profits thereof,
subject, however, to the right, power and authority hereinafter given to and conferred upon
Beneficiary to collect and apply such rents, issues and profits for the purpose of securing (1)
Trustor’s payment of the “Profit Participation” as defined and calculated in accordance with the
terms of that certain unrecorded Profit Participation Agreement dated as of even date herewith
between Trustor and Beneficiary; and (2) the performance of each agreement of Trustor
incorporated by reference or contained herein.
To protect the security of this Deed of Trust, and with respect to the Property, Trustor expressly
makes each and all of the agreements, and adopts and agrees to perform and be bound by each
and all of the terms and provisions set forth in subdivisionA, and it is mutually agreed that each
and all of the terms and provisions set forth in subdivision B of the fictitious deed of trust
recorded in Orange County August 17, 1964, and in all other counties August 18, 1964, in the
book and at the page of Official Records in the office of the county recorder of the county where
the Property is located, noted below opposite the name of such county, namely:
C-1
Exhibit C to Profit Participation Agreement
COUNTY BOOK PAGE COUNTY BOOK PAGECOUNTYBOOKPAGE COUNTY BOOKPAGE
Alameda 1288 556 Kings 858 713 Placer1028379 Sierra 38 187
Alpine 3130-31 Lake 437 110 Plumas 166 1307Siskiyou 506762
Amador 133 438 Lassen 192 367 Riverside3778347 Solano 1287621
Butte1330 513 Los Angeles T-3878874 Sacramento 5039124 Sonoma 2067427
Calaveras 185 338 Madera911 136 San Benito 300 405 Stanislaus 197056
Colusa323 391 Marin 1849 122 San Bernardino6213768 Sutter655585
Contra Costa4684 1Mariposa90453 San FranciscoA-804 596 Tehama 457183
Del Norte 101 549 Mendocino 667 99San Joaquin 2855283 Trinity 108595
El Dorado 704 635 Merced 1660 753 San Luis Obispo 1311137 Tulare 2530108
Fresno 5052 623 Modoc 191 93San Mateo4778175 Tuolumne 177160
Glenn 469 76Mono69302 Santa Barbara 2065881 Ventura2607237
Humboldt 801 83Monterey 357 239 Santa Clara 6626664 Yolo 76916
Imperial 1189 701 Napa 704 742 Santa Cruz 1638607 Yuba 398693
Inyo 165 672 Nevada 363 94Shasta 800 633
Kern 3756 690 Orange 7182 18San Diego SERIES 5 Book 1964, Page 149774
shallinure to and bind the parties hereto, with respect to the Property. Said agreements, terms
and provisions contained in said subdivisions A and B (identical in all counties) are by the within
reference thereto, incorporated herein and made a part of this Deed of Trust for all purposes as
fully as if set forth at length herein, and Beneficiary may charge for a statement regarding the
obligation secured hereby, provided the charge therefor does not exceed the maximum allowed
by law.
The undersigned Trustor, requests that a copy of any notice of default and any notice of sale
hereunder be mailed to him at his address hereinbefore set forth.
[SIGNATURE PAGE FOLLOWS]
C-2
Exhibit C to Profit Participation Agreement
Signature of Trustor
STANDARD PACIFIC CORP.,
a Delaware corporation
By:
Its:
By:
Its:
C-3
Exhibit C to Profit Participation Agreement
STATE OF CALIFORNIA }
COUNTY OF }
On , before me, , Notary Public,
(here insert name and title of the officer)
personally appeared , who proved to me on the
basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within
instrument, and acknowledged to me that he/she/they executed the same in his/her/their
authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or
the entity upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the
foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Signature ___________________________________
(This area for official notarial seal)
STATE OF CALIFORNIA }
COUNTY OF }
On , before me, , Notary Public,
(here insert name and title of the officer)
personally appeared , who proved to me on the
basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within
instrument, and acknowledged to me that he/she/they executed the same in his/her/their
authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or
the entity upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the
foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Signature _______________________________________
(This area for official notarial seal)
C-4
Exhibit C to Profit Participation Agreement
EXHIBIT “A”
DESCRIPTION OF PROPERTY
That certain real property in the City of Tustin, County of Orange, State of California, described
as follows:
[Lots 263 through 268, INCLUSIVE, AS SHOWN ON Tract Map No. 17507, RECORDED
__________________, 201___ IN PAGE __________________, BOOK
____________________ OF _______________________, IN THE OFFICE OF THE COUNTY
[check]
RECORDER OF ORANGE COUNTY, CALIFORNIA.]
C-5
Exhibit C to Profit Participation Agreement
DO NOT RECORD
The following is a copy of Subdivisions A and B of the fictitious Deed of Trust recorded in each
county in California as stated in the foregoing Deed of Trust and incorporated by reference in
said Deed of Trust as being a part thereof as if set forth at length therein.
A.To protect the security of this Deed of Trust, Trustor agrees:
1) To keep said property in good condition and repair, not to remove or demolish any
building thereon; to complete or restore promptly and in a good and workmanlike manner any
building which may be constructed, damaged or destroyed thereon and to pay when due all
claims for labor performed and materials furnished therefor, to comply with all laws affecting
said property or requiring any alterations or improvements to be made thereon; not to commit or
permit waste thereof; not to commit, suffer or permit any act upon said property in violation of
law; to cultivate, irrigate, fertilize, fumigate, prune and do all other acts which from the character
or use of said property may be reasonably necessary, the specific enumerations herein not
excluding the general.
2) To provide, maintain and deliver to Beneficiary fire insurance satisfactory to and with
loss payable to Beneficiary. The amount collected under any fire or other insurance policy may
be applied by Beneficiary upon any indebtedness secured hereby and in such order as
Beneficiary may determine, or at the option of Beneficiary the entire amount so collected or any
part thereof may be released to Trustor. Such application or release shall not cure or waive any
default or notice of default hereunder or invalidate any act done pursuant to such notice.
3) To appear in and defend any action or proceeding purporting to affect the security
hereof or the rights or powers of Beneficiary or Trustee; and to pay all costs and expenses,
including cost of evidence of title and attorney’s fees in a reasonable sum, in any such action or
proceeding in which Beneficiary or Trustee may appear, and in any suit brought by Beneficiary
to foreclose this Deed.
4) To pay: at least ten days before delinquency all taxes and assessments affecting said
property, including assessments on appurtenant water stock; when due, all encumbrances,
charges and liens, with interest, on said property or any part thereof, which appear to be prior or
superior hereto; all costs, fees and expenses of this Trust.
Should Trustor fail to make any payment or to do any act as herein provided,then
Beneficiary of Trustee, but without obligation so to do and without notice to or demand upon
Trustor and without releasing Trustor from any obligation hereof, may: make or do the same is
such manner and to such extent as either may deem necessary to protect the security hereof,
Beneficiary or Trustee being authorized to enter upon said property for such purposes; appear in
and defend any action or proceeding purporting to affect the security hereof or the rights or
powers of Beneficiary or Trustee; pay, purchase, contest or compromise any encumbrance,
charge or lien which in the judgment of either appears to be prior or superior hereto; and, in
exercising any such powers, pay necessary expenses, employ counsel and pay his reasonable
fees.
C-6
Exhibit C to Profit Participation Agreement
5) To pay immediately and without demand all sums so expended by Beneficiary or
Trustee, with interest from date of expenditure at the amount allowed by law in effect at the date
hereof, and to pay for any statement provided for by law in effect at the date hereof regarding the
obligation secured hereby any amount demanded by the Beneficiary not to exceed the maximum
allowed by law at the time when said statement is demanded.
B.It is mutually agreed:
1) That any award in connection with any condemnation for public use of or injury to
said property or any part thereof is hereby assigned and shall be paid to Beneficiary who may
apply or release such moneys received by him in the same manner and with the same effect as
above provided for disposition of proceeds of fireor other insurance.
2) That by accepting payment of any sum secured hereby after its due date, Beneficiary
does not waive his right either to require prompt payment when due of all other sums so secured
or to declare default for failure so to pay.
3) That at any time or from time to time, without liability therefor and without notice,
upon written request of Beneficiary and presentation of this Deed and said note for endorsement,
and without affecting the personal liability of any person for payment ofthe indebtedness
secured hereby, Trustee may: reconvey any part of said property; consent to the making of any
map or plat thereof; join in granting any easement thereon, or join in any extension agreement or
any agreement subordinating the lien or chargehereof.
4) That upon written request of Beneficiary stating that all sums secured hereby have
been paid, and upon surrender of this Deed and said note to Trustee for cancellation and
retention or other disposition as Trustee in its sole discretion may choose and upon payment of
its fees, Trustee shall reconvey, without warranty, the property then held hereunder. The recitals
in such reconveyance of any matters or facts shall be conclusive proof of the truthfulness thereof.
The Grantee in such reconveyance may be described as “the person or persons legally entitled
thereto.”
5) That as additional security, Trustor hereby gives to and confers upon Beneficiary the
right, power and authority, during the continuance of these Trusts, to collect the rents, issues and
profits of said property, reserving unto Trustor the right, prior to any default by Trustor in
payment of any indebtedness secured hereby or in the performance of any agreement hereunder,
to collect and retain such rents, issues and profits as they become due and payable. Upon any
such default, Beneficiary may at any time without notice, either in person, by agent, or be a
receiver to be appointed by a court, and without regard to the adequacy of any security for the
indebtedness hereby secured, enter upon and take possession of said property or any part thereof,
in his own name sue for or otherwise collect such rents, issues, and profits, including those past
due and unpaid, and apply the same, less costs and expenses of operation and collection,
including reasonable attorney’s fees, upon any indebtedness secured hereby, and in such order as
Beneficiary may determine. The entering upon and taking possession of said property, the
collecting of such rents, issues and profits and the application thereof as aforesaid, shall not cure
or waive any default or notice of default hereunder or invalidate any act done pursuant to such
notice.
C-7
Exhibit C to Profit Participation Agreement
6) That upon default by Trustor in payment of any indebtedness secured hereby or in the
performance of any agreementhereunder, Beneficiary may declare all sums secured hereby
immediately due and payable by delivery to Trustee of written declaration of default and demand
for sale and of written notice of default and of election to cause to be sold said property, which
notice Trustee shall cause to be filed for record. Beneficiary also shall deposit with Trustee this
Deed, said note and all documents evidencing expenditures secured hereby.
After the lapse of such time as may then be required by law following the recordation of
said notice of default, and notice of sale having been given as then required by law, Trustee,
without demand on Trustor, shall sell said property at the time and place fixed by it in said notice
of sale, either as a whole or in separate parcels, and in such order as it may determine, at public
auction to the highest bidder for cash in lawful money of the United States, payable at time of
sale. Trustee may postpone sale of all or any portion of said property by public announcement at
such time and place of sale, and from time to time thereafter may postpone such sale by public
announcement at the time fixed by the preceding postponement. Trustee shall deliver to such
purchaser its deed conveying the property so sold, but without any covenant or warranty, express
or implied. The recitals in such deed of any matters or facts shall be conclusive proof of the
truthfulness thereof. Any person, including Trustor, Trustee, or Beneficiary as hereinafter
defined, may purchase at such sale.
After deductingall costs, fees and expenses of Trustee and of this Trust, including cost of
evidence of title in connection with sale, Trustee shall apply the proceeds of sale to payment of:
all sums expended under the terms hereof, not then repaid, with accrued interest at the amount
allowed by law in effect at the date hereof; all other sums then secured hereby; and the
remainder, if any, to the person or persons legally entitled thereto.
7) Beneficiary, or any successor in ownership of any indebtedness secured hereby, may
from time to time, by instrument in writing, substitute a successor or successors to any Trustee
named herein or acting hereunder, which instrument, executed by the Beneficiary and duly
acknowledged and recorded in the office of the recorder of the county or counties where said
property is situated shall be conclusive proof of proper substitution of such successor Trustee or
Trustees, who shall, without conveyance from the Trustee predecessor, succeed to all its title,
estate, rights, powers and duties. Said instrument must contain the name of the original Trustor,
Trustee and Beneficiary hereunder, the book and page where this Deed is recorded and the name
and address of the new Trustee.
8) That this Deed applies to, inures to the benefit of, and binds all parties hereto, their
heirs, legatees, devisees, administrators, executors, successors and assigns. The term Beneficiary
shall mean the owner and holder, including pledgees, of the note secured hereby, whether or not
named as Beneficiary herein.In this Deed, whenever the context so requires, the masculine
gender includes the feminine and/or neuter, and the singular number includes the plural.
9) That Trustee accepts this Trust when this Deed, duly executed and acknowledged, is
made a public record as provided by law. Trustee is not obligated to notify any party hereto of
pending sale under any other Deed of Trust or of any action or proceeding in which Trustor,
Beneficiary or Trustee shall be a party unless brought by Trustee.
C-8
Exhibit C to Profit Participation Agreement
Attachment 15
ATTACHMENT 15
CERTIFICATE OF COMPLIANCE
CITY OF TUSTIN OFFICIAL
BUSINESS REQUEST
DOCUMENT TO BE
RECORDED AND TO BE
EXEMPT FORM RECORDING
FEES PER GOVERNMENT
CODE §6103 AND §27383.
Recording requested by and
when recorded mail to:
The City of Tustin
300 Centennial Way
Tustin, CA 92780
Attention: City Manager
________________________________________________________________________
SPACE ABOVE THIS LINE FOR RECORDER'S USE
CERTIFICATE OF COMPLIANCE
Certificateof Compliance
ThisCERTIFICATEOF COMPLIANCE (“”) is made as of
_____________, 20__ by the CITY OF TUSTIN, a municipal corporation of the State of
CityDeveloper
California (“”), in favor of Standard Pacific Corp., a Delaware corporation (“”),
with reference to the following matters:
A.The City and the Developer entered into that certain Tustin Legacy Disposition
and Development Agreement For Disposition Parcels1B and 6A, dated as of _______________,
DDA
2014(the“”). The DDA is evidenced by that certain Memorandum of Disposition and
Memorandum of DDA
Development Agreement (Parcel 1B and Parcel 6A)(the “”), dated as of
___________, 20___, and recorded in the Office of the County Recorder, Orange County,
Official Records
California (the “”) as Instrument No. ______________ with respect to certain
real property legally described on Exhibit“A”attached hereto and incorporated herein by this
Development Parcels
reference (the“”). All initially capitalized terms not otherwise defined
herein shall have the meanings assigned to them in the DDA.
B. Pursuant to the DDA, the Developer agreed to develop and construct certain
Improvements comprising the Project on the Development Parcels.
C.Pursuant to Section9of the DDA, the City agreed to furnish to the Developer,
upon request therefor by the Developer, aCertificateof Compliancein recordable form upon
satisfaction of the Conditions Precedent to issuance thereof set forth in Section9.3of the DDA
(including, without limitation, Completion of all Improvements for the Project in accordance
with the terms and conditions of the DDA).
1
Attachment 15 Certificate of ComplianceCity of Tustin/Standard Pacific
Tustin Standard Pacific Certificate Of Compliance 1-28-2014January 28, 2014
D.The City has determined that the Developer has satisfied the Conditions Precedent
set forth in Section9.3of the DDA for the City’s issuance of a Certificateof Compliancewith
respect totheDevelopment Parcelsand the Project.
NOW, THEREFORE, the City certifies as follows:
1.This Certificateof Compliance covers and applies to theDevelopment Parcels
and the entirety of the Improvements and the Project.
2.This Certificateof Compliance shall be deemed conclusive evidence of the City’s
determination that the Developer has satisfactorily Completed all construction and development
with respect to the Improvements comprising the Project and hassatisfied all Conditions
Precedent set forth in Section9.3of the DDA for issuance of this Certificateof Compliance.
3.After the Recording of thisCertificate of Complianceinthe Official Records,the
DDA shall terminate and,except as set forth below, any Person then owning or thereafter
purchasing, leasing, or otherwise acquiring any interest in the Development Parcels shall not
(because of such ownership, purchase, lease or acquisition) incur any obligation or liability under
the DDAwith respect to such Improvements, except that the followingmattersshall survive the
termination of the DDA each in accordance with theirterms:
(a)The Quitclaim Deed dated __________, 20__ and recorded on
____________, 20__ in the Official Records as Instrument No. ______________ shall remain in
effect in perpetuity,
(b)The Profit Participation Agreement, the Special Restrictions,the CC&Rs
and the Landscape Maintenance Agreement shall each remain in effect for the term specified
therein;and
(c)The following provisions of the DDA shall expressly survive the
termination of the DDAand shall remain in effect for the period set forth below:
(i)The provisions of Section 4.5.2of the DDA, including the release
set forth therein, as and to the extent set forth in the Quitclaim Deed,shall survive in
perpetuity, shall run with the land and shall be binding upon Developer and its Successor
Owners including Homebuyers and other End Users;
(ii)The provisions of Section 11.1.4of the DDAshall survive until the
expiration of the time period for provision of the environmental insurance policy described
thereby; and the obligation to provide such insurance policy shall remain in effect for a
period of ten (10) years from Close of Escrow and shall (A) continue to run with the land
owned by Developer and Successor Owners and not then conveyed to any Homebuyer or
other End User and (B)bind Developerand its successors and assigns and each and every
prior Developer not released by the City pursuant to Section 2.2.3(a)(iii), provided that upon
sale or transfer to any Homebuyer or any other End User, such obligation shall not run with
the land or survive with respect to or bind any such Homebuyer or End User or any of their
respective successors and assigns;
2
Attachment 15 Certificate of ComplianceCity of Tustin/Standard Pacific
Tustin Standard Pacific Certificate Of Compliance 1-28-2014January 28, 2014
(iii)The indemnities set forth in Sections 5.5, 8.12(e), 8.15, 8.16, 10.1,
10.2 and 17.12.1shall remain in effect as and to the extent set forth in Section 10.3of the
DDA; provided that upon sale or transfer to any Homebuyer or any other End User, such
obligationshall not run with the land or survive with respect to or bind any such Homebuyer
or End User or any of their respective successors and assigns;and
(iv)Any and all obligations contained in the Federal Deed shall survive
in perpetuity to the extent set forth therein, unless such obligations are released by the
Federal Government.
(v)Developer shall not modify or terminate any prepaid
environmental insurance policy in effect as of the issuance of the Certificate of Compliance.
Except as set forth above with respect to Homebuyers and End Users andtheir respective
successors and assigns; this Certificate shall be binding upon Developer and Developer’s
successors and assigns and each andevery prior Developer not released by the City pursuant
to Section 2.2.3(a)(iii) and each such party shall be jointly and severally liable under such
provisions with respect to the entirety of the Project, the Development Parcels and the
Improvementsfor the term set forth above.
4.5.Issuance of the Certificate of Compliance shall not waive any rights or claim that
the City may have against any party for latent or patent defects in design, construction or similar
matters under any applicable law, nor shall it be evidence of satisfaction of any of Developer’s
obligations to third parties who arenot a party to the DDA.
5.This Certificateof Compliance is not a Notice of Completion as referred to in
California Civil Code Section 3093.
6.Except as stated herein, nothing contained in this instrument shall modify in any
way any other provisions of the DDA or any other provisions of the documents incorporated
herein.
{remainder of page is blank/ signatures on following page}
3
Attachment 15 Certificate of ComplianceCity of Tustin/Standard Pacific
Tustin Standard Pacific Certificate Of Compliance 1-28-2014January 28, 2014
IN WITNESS WHEREOF, the Cityhas caused thisCertificateof Compliance to be duly
executed by its officer duly authorized as of the date first above written.
CITY OF TUSTIN
Dated: ___________________By:
Name:______________________________
Title:_______________________________
ATTEST:
By:
Name:___________________
Title:____________________
APPROVED AS TO FORM:
By:
Name:________________
City Attorney
4
Attachment 15 Certificate of ComplianceCity of Tustin/Standard Pacific
Tustin Standard Pacific Certificate Of Compliance 1-28-2014January 28, 2014
STATE OF CALIFORNIA)
) ss.
COUNTY OF ORANGE)
On ______________________, before me,____________________________________ ,
DateHere Insert Name and Title of the Notary
personally appeared ____________________________________________________________,
Name of Person executing document
who proved to me on the basisof satisfactory evidence to be the person whose name is
subscribed to the within instrument and acknowledged to me that he/she executed the same in
his/her authorized capacity, and that by his/her signature on the instrument the person, or the
entity uponbehalf of which the person acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that
the foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Signature:_____________________________________
Signature of Notary Public
(SEAL)
5
Attachment 15 Certificate of ComplianceCity of Tustin/Standard Pacific
Tustin Standard Pacific Certificate Of Compliance 1-28-2014January 28, 2014
Exhibit “A”
Legal Description of the Development Parcels
[insert legal description]
6
Attachment 15 Certificate of ComplianceCity of Tustin/Standard Pacific
Tustin Standard Pacific Certificate Of Compliance 1-28-2014January 28, 2014
Attachment 16A
ATTACHMENT 16A
ASSIGNMENT AND ASSUMPTION AGREEMENT
CITY OF TUSTIN OFFICIAL BUSINESS
REQUEST DOCUMENT TO BE
RECORDED AND TO BE EXEMPT FROM
RECORDING FEES PER GOVERNMENT
CODE 6103 AND 27383.
Recording requested by and
when recorded mail to:
City Manager
The City of Tustin
300 Centennial Way
Tustin, CA 92780
SPACE ABOVE THIS LINE FOR RECORDER'S USE
ASSIGNMENT AND ASSUMPTION AGREEMENT
(Parcel 1B and Parcel 6ATustin Legacy)
Assignment
This ASSIGNMENT AND ASSUMPTION AGREEMENT (“”) is made as
Assignment Effective Date
of __________, 20__ (the “”) by and between STANDARD
Developer
PACIFIC CORP., a Delaware corporation(“”) and _________________, a
Transferee[{to be inserted only in connection with a
_________________________ (“”),
Transfer that is not a PermittedTransfer}
with the consent of the CITY OF TUSTIN, a
municipal corporation of the State of California (the “City”),]with reference to the following
matters:
A.The City and Developer entered into that certain Tustin Legacy Disposition and
Development Agreement for Disposition Parcels 1B & 6A, dated as of _________________,
DDA”
2014 (the “), relating to the conveyance from the City to Developer of that certain real
Development Parcels
property legally described on Exhibit“A”attached hereto (the “”) and the
subsequent development of the Development Parcelsby Developer, all as more particularly set
forth in the DDA. All initially capitalized terms not otherwise defined in this Assignment shall
have the meanings ascribed to such terms in the DDA.
B.The City has executed that certain Declaration of Special Restrictions for
Special Restrictions
Disposition Parcels1B and 6A(“”), dated _____________, 2014, that was
Official
recorded in the Office of the County Recorder, Orange County, California (the “
Records
”), against title to the Development Parcelson _____________, 2014as Instrument No.
__________, which includes, among other matters, certain requirements regarding the use and
maintenance of the Development Parcelsand sets forth those provisions ofthe DDA that survive
the issuance of a Certificate of Compliance with respect to the Project.
1
Attachment 16A Assignment and Assumption Agmt.City of Tustin /Standard Pacific
Tustin Standard Pacific Assignment & Assumption Agmt 01-29-2014.docx January 29, 2014
C.The City has executed thatcertain Quitclaim Deedfor Disposition Parcels 1B and
6Aand Covenants, Conditions and Restrictions, Including Environmental Restriction Pursuant
Quitclaim Deed
To Civil Code Section 1471 (“”), dated _____________, 2014, which was
recorded in the Official Records against title to the Development Parcelson _____________,
2014as InstrumentNo. __________, which Quitclaim Deedconveyed to Developer the fee title
to the Development Parcels, subject to certain restrictions and limitations set forth in the
Quitclaim Deed.
D.Developer and the City executed that certain Memorandum ofDisposition and
Memorandum of DDA
Development Agreement(Parcels 1Band 6A)(“”), dated
_____________,2014, which was recorded in the Official Records against title to the
Development Parcelson _____________, 2014as Instrument No. __________, and provided
record notice of the DDA.
E.Developer and the City executed that certain Tustin Legacy Development
DA
Agreement (“”), dated _______________, 2014, which was recorded in the Official Records
against title to the Development Parcelson _________________, 2014as Instrument No.
_______________.
F.The DDA, the Memorandum of DDA, the Special Restrictions, the DA, the
Quitclaim Deed, the Dirt Agreement, the Landscape Maintenance Agreement and the Profit
Property Documents
Participation Agreementare collectively referred to herein as the “.”
G.Pursuant to the DDA, Developer agreed to develop and construct on the
Development Parcelscertain Improvements comprising the Project.
H.Concurrently with the execution and delivery of this Assignment, Developer is
[NOTE: excluding only those
conveying to Transferee the entirety of the Development Parcels
portions previously conveyed to Homebuyers or to a Homeowners’Associationunless
otherwise consented toby the City in its sole discretion]
comprised of that certain real property
TransferParcel
legally described on Exhibit“B”attached hereto (the “”), and all Improvements
located on the Transfer Parcel, and Transferee will develop the Transfer Parcel in accordance
with the requirements ofthe DDA, including, without limitation, the Scope of Development and
the Schedule of Performance, and the other Property Documents.
I.The DDA imposes certain covenants, conditions, payment obligations and
restrictions on the Development Parcelsand, prior to the filing of a Certificate of Completion,
the DDA restricts Developer’s ability to transfer ownership and/or control of the Development
Parcels, the Project, the Improvements and/or Developer’s obligations with respect to the Project
(including,withoutlimitation,Developer’s obligations with respect to the off-site infrastructure
improvements), all as set forth in the DDA.
J.Developer desires to convey the Transfer Parcelto Transferee and to assign to
Transferee all of Developer’s right, title and interest in and to the Property Documentswith
Transfer Event{to be inserted only in connection with a
respect to the Transfer Parcel(the “”) [
Transfer that is not a Permitted Transfer}
to have such assignment approved by the City, and to
have Transferee approved by the City as a “Transferee” (as that term is defined in and used in
2
Attachment 16A Assignment and Assumption Agmt.City of Tustin /Standard Pacific
Tustin Standard Pacific Assignment & Assumption Agmt 01-29-2014.docx January 29, 2014
Section 2 of the DDA)].Pursuant to Section2of the DDA, a Transfer must include, among other
things, the execution and delivery of an assignment and assumption agreement. Developer and
Transferee are entering into this Assignment in order to fulfill the obligations of Developer and
Transferee as a Transferee under Section 2of the DDA.
K.Simultaneouslywith this Transfer Event, Transferee will be acquiring the
Transfer Parcelfrom Developer pursuant to and in accordance with the terms of the DDA.
NOW, THEREFORE, for good and valuable consideration, Developer and Transferee
agree as follows:
1.Assignment.
1.1.As of the Assignment Effective Date, Developer hereby assigns, conveys,
transfers, bargains, grants, sells and sets over to Transferee, as and to the extent owned or held
Assigned Interests
by Developer, the following (collectively, the “”):
(a)all right, title, interest and obligation of Developer as the “Developer”
under the Property Documentswith respect to the Transfer Parcel, arising from and after the
Assignment Effective Date, including (i)all benefits provided to and burdens imposed upon
Developer pursuant to the Property Documents with respect to the Transfer Parcel, and(ii) all
benefits provided to and burdens imposed upon the Transfer Parceland all improvements
thereon and all personal property associated therewith pursuant to the Property Documents;
(b)all Entitlements and Development Permitswith respect to the Transfer
Parcel;
(c)all plans, specifications, maps, drawings, and other renderings owned by
Developer and relating to the Transfer Parcel, the Project and the Entitlements or such portion
thereof as is subject to this Assignment;
(d)all warranties, claims, and any similar rights of Developer relating to and
benefiting the Transfer Parcelor the rights and interests transferred pursuant to this Assignment;
(e)[{include only if TransferParcel comprisesall of the Development
Parcels}all intangible rights, goodwill, and similar rights relating to the Project and/or the
Transfer Parcel;and
(f)all development rights relating to the Transfer Parcel.
1.2.The Assigned Interests together with the Transfer Parcelare collectively referred
Assigned Property
to in this Assignment as the “.”
3
Attachment 16A Assignment and Assumption Agmt.City of Tustin /Standard Pacific
Tustin Standard Pacific Assignment & Assumption Agmt 01-29-2014.docx January 29, 2014
2.Assumption.
2.1.Transferee, on behalf of itself and its successors and assigns, from and after the
Assignment Effective Date, hereby assumes and receives the Assigned Property and Transferee
agrees with Developer (and such agreement is expressly also made for the benefit of the City and
may be directly enforced by the City) as follows, in each case, to the extent relating to the period
from and after the Assignment Effective Date:
(a)Transferee accepts and assumes all of the rights and benefits accruing to
Developer under the Property Documentsrelating to the Transfer Parcel, and all of the
obligations, conditions, limitations and restrictions related to the Transfer Parcel and/or the
Assigned Interests imposed upon Developer under the Property Documents.Transferee
expressly assumes and shall be subject to all the obligations, conditions, limitations and
restrictions to which Developer and/or the Transfer Parcelis subject under or by reason of the
Property Documentsthat relate to the Transfer Parcel, including, without limitation, the
provisions of the release set forth in Section 4.5.2of the DDA and the indemnities set forth in
Section 10of the DDA;
(b)Transferee expressly assumes and shall be subject to all the obligations,
conditions, limitations and restrictions to which Developer and/or the Assigned Property are
subject by reason of the Entitlementsrelated to the Transfer Parcel;
(c)Upon and subject to the terms and provisions of the Property Documents,
Transferee expressly assumes and shall be subject to all the obligations to perform, construct
and/or install any and all Improvements to be constructed on the Transfer Parcel in accordance
with the Scope of Development and within the time period specified in the Schedule of
Performance;and
(d)Upon and subject to the terms and provisions of the Property Documents,
Transferee shall pay and perform all obligations of Developer set forth in the Property
Documents that relate to the Assigned Property, including, without limitation, the following
obligations: (i) the obligation to construct the Improvements to be constructed on the Transfer
Parcelin accordance with the Scope of Development and within the time period specified in the
Schedule of Performance; and (ii) the obligation to pay all sums required to be paid by
Developer under the Property Documents in connection with the ownership and/or development
of the Assigned Property, to the extent such amounts have not been paid as of the Assignment
Effective Date.
2.2.Transferee shall remain fully responsible to perform and satisfy all of the
obligations and liabilities assumed by Transferee pursuant to Section2.1above regardless of any
of the following:
(i)the value of the Assigned Property or the income to be
derived from theAssigned Property;
(ii)the existence or non-existenceof any liens, easements,
covenants, conditions, restrictions, claims or encumbrances affecting the
Assigned Property (including without limitation any of the foregoing
4
Attachment 16A Assignment and Assumption Agmt.City of Tustin /Standard Pacific
Tustin Standard Pacific Assignment & Assumption Agmt 01-29-2014.docx January 29, 2014
arising from or related to the Entitlements or any of the Property
Documents);
(iii)the suitability of the Assigned Property for any and all
future development, uses and activities which Transferee or Developer
may conduct thereon, including the development of the Project as
described in the Property Documents;
(iv)the ability of the City or any third party to complete, or
likelihood of the completion of, any of the improvements and
infrastructure described by the General Plan, the Reuse Plan, the Specific
Plan, the Tustin Legacy Backbone Infrastructure Program or any other
plan or policy of the City or any other Governmental Authorities;
(v)the compliance by the City or any third party with respect
to the Reuse Plan, the General Plan, the Specific Plan, the Special
Restrictions applicable to the Property or the special restrictions or other
covenants and agreements applicable to other propertyat Tustin Legacy,
the CC&Rs or any other agreement or governmental restriction or plan
affecting Tustin Legacy;
(vi)the habitability, merchantability or fitness for a particular
purpose of the Assigned Property;
(vii)the manner, quality, state of repair or lack of repair of the
Assigned Property;
(viii)the nature, quality or condition of the Transfer Parcel
including water, soil and geology;
(ix)the compliance of or by the Assigned Property and/or its
operation in accordance with any of the Entitlements or any Governmental
Requirement, including without limitation, the National Environmental
Policy Act, CEQA and the Americans with Disabilities Act of 1990;
(x)the manner or quality of the construction or materials, if
any, incorporated intoany part of the Transfer Parcel or the
Improvements;
(xi)the presence or absence of Hazardous Materials, including
without limitation, asbestos or lead paint at, on, under, or adjacent to the
Transfer Parcel or any other portion of the Development ParcelsorTustin
Legacy;
(xii)the content, completeness or accuracy of the information,
documentation, studies, reports, surveys and other materials, delivered to
Transferee by Developeror others in connection with Transferee’sreview
5
Attachment 16A Assignment and Assumption Agmt.City of Tustin /Standard Pacific
Tustin Standard Pacific Assignment & Assumption Agmt 01-29-2014.docx January 29, 2014
of the Assigned Property and the transactions contemplated in the Property
Documents;
(xiii)the conformity of the existing improvements on the
Transfer Parcel, if any, to any plans or specifications;
(xiv)compliance of the Assigned Property with past, current or
future Governmental Requirements(including, without limitation, the
Entitlements)relating to zoning, subdivision, planning, building, fire,
safety, health or Environmental Matters and/or covenants, conditions,
restrictions or deed restrictions;
(xv)the deficiency of any undershoring or of any drainageto,
on or from the Transfer Parcel or any other portion of Tustin Legacy;
(xvi)the fact that all or a portion of the Transfer Parcelmay be
located on or near an earthquake fault line or falls within an earthquake
fault zone established under the Alquist-Priolo Earthquake Zone Act,
California Public Resources Code sections2621-2630 or within a seismic
hazard zone established under the Seismic Hazards Mapping Act,
California Public Resources Codesections2690-2699.6 and
sections3720-3725;
(xvii)the existence or lack of vested land use, zoning or building
entitlements affecting the Transfer Parcel;
(xviii)the construction or lack of construction of Tustin Legacy or
if constructed, the construction of Tustin Legacy in accordance with
design guidelines, plans and specifications previously or to be prepared
therefor;
(xix)the conditions, covenants and restrictions imposed upon the
Assigned Property or any portion thereof under the Property Documentsor
the Entitlements;
(xx)the contents of the Memorandum of Agreement, the
Federal Deed, the Base Closure Law and the FOST; and
(xxi)any other matters.
3.No Waiver or Modification. Nothing contained in this Assignment shall modify in any
way any other provisions of the Property Documents and/or the Entitlements. Transferee
acknowledges that it is taking title to and is assuming the Assigned Property subject to, among
other things, the rights of the City as described in the Property Documents.
4.Additional Documents. Developer and Transferee shall each execute and deliver to the
other party, upon demand, such further documents, instruments and conveyances, and shall take
such further actions as are necessary or desirable to effectuate the intent and purposes of this
6
Attachment 16A Assignment and Assumption Agmt.City of Tustin /Standard Pacific
Tustin Standard Pacific Assignment & Assumption Agmt 01-29-2014.docx January 29, 2014
Assignment. In addition to the foregoing, Developer shall reasonably cooperate with Transferee,
at the expense of Transferee, to allow Transferee to submit and process any warranty claim under
any warranty in which Transferee obtained an interest as part of the Assigned Interests.
5.Miscellaneous.
5.1.Modification. No amendment, change, modification or supplement to this
Assignment shall be valid and binding on Developer or Transferee unless it is represented in
writing and signed by both Developer and Transferee. [To be inserted only in connection with a
Transfer that is not a Permitted Transfer: No amendment, change, modification or supplement to
this Assignment shall be deemed to be part of the consent or deemed to be consented to by the
City, unless the City executes a separate written consent to such amendment, change,
modification or supplement.]
5.2.Applicable Law. This Assignment shall be governed by, interpreted under,
construed and enforced in accordance with the laws of the State of California, irrespective of
California’s choice-of-law principles.
5.3.Binding Effect. This Assignment and the terms, provisions, promises, covenants
and conditions hereof shall be binding uponand inure to the benefit of Developer and Transferee
and their respective heirs, legal representatives, successors and assigns.
5.4.Counterparts. This Assignment 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
Assignment shall not be effective until the execution and delivery by Developer and Transferee
of at least one set of counterparts [to be inserted only in connection with a Transfer that is not a
Permitted Transfer:(together with an executed counterpart of the City’s consent attached to this
Assignment)]. A counterpart of this Assignment that is executed and delivered electronically (by
facsimile machine or email) shall not be effective unless an ink-signed original executed copy of
the signature page of this Assignment is also promptly delivered to the other party, and such ink-
signed original executed page is actually received by the other party. Developer and Transferee
hereby authorize each other to detach and combine original signature pages and notarial
acknowledgements and consolidate them into a single identical original. Any one of such
completely executed counterparts shall besufficient proof of this Assignment as a duly and
validly executed agreement.
5.5.City as Third Party Beneficiary.Developer and Transferee hereby acknowledge
and agree that until theCertificate of Compliance is recorded in the Official Records, the City
shall be an intended third party beneficiary under this Assignment and the City shall have the
right to enforce the terms and provisions of this Assignment applicable to the City. Other than
the City, there shall be no third party beneficiaries of this Assignment.
5.6.[to be inserted only in connection with a Transfer that is not a Permitted
Transfer; any Transferee subject to a Permitted Transfer may provide separate notice to the City
of any change in address for notice purposes:Notices. From and after the Amendment Effective
Date, all notices that the City may desire or is required to deliver to the “Developer” under the
7
Attachment 16A Assignment and Assumption Agmt.City of Tustin /Standard Pacific
Tustin Standard Pacific Assignment & Assumption Agmt 01-29-2014.docx January 29, 2014
Property Documents and/or the Entitlements with respect to the Transfer Parcel, and pursuant to
Section17.6of the DDA, shall be delivered to Transferee only at the following addresses:
Transferee:
[__entity_______]
_______________________
_______________________
_______________________
with a copy to:
[legal counsel]
_______________________
_______________________
_______________________]
[signature page follows]
8
Attachment 16A Assignment and Assumption Agmt.City of Tustin /Standard Pacific
Tustin Standard Pacific Assignment & Assumption Agmt 01-29-2014.docx January 29, 2014
Developer and Transferee each has caused this Assignment to be duly executed by its
duly authorized officer as of the Assignment Effective Date.
“DEVELOPER”
Standard Pacific Corp.,
a Delaware corporation
By: ________________________
Name: ______________________
Dated: __________________Title: ________________________
“TRANSFEREE”
[___entity___],
a _______________________________
Dated: __________________
By:
Name:
Title:
By:
Name:
Title:
{City consent on next page}
9
Attachment 16A Assignment and Assumption Agmt.City of Tustin /Standard Pacific
Tustin Standard Pacific Assignment & Assumption Agmt 01-29-2014.docx January 29, 2014
[THE FOLLOWING ACKNOWLEDGEMENT ISTO BE INSERTED ONLY IN
CONNECTION WITH A TRANSFER THAT IS NOT APERMITTED TRANSFER]
ACKNOWLEDGMENT AND CONSENT BY CITY OF TUSTIN
By executing in the space set forth below, the City of Tustin hereby:
(a)Acknowledgesreceipt of the Assignment and Assumption Agreement
Assignment
(the“”) to which this Consent is attached;
(b)Consentsto the making of the Assignment between Developer and Transferee,
subject to the terms and conditions set forth in the Assignment;
(c)This Consent by the City constitutes the consent required pursuant to Section 2of
the DDA and constitutes satisfaction of Developer’s obligation to obtain the City’s consent
pursuantto Section 2of the DDA;
(d)Agrees that [ insert name of Transferee], a _____________________ (the
assignee in the Assignment) shall be deemed by the City to be the “Developer” under the DDA
with respect to the Transfer Parcel, from and after the Assignment Effective Date;
[{Applies only if there is a release of Developer}
(e)Confirms that Developer shall
be released from any of its obligations under the Property Documents related to the Transfer
Parcel arising from and after the Assignment Effective Date; provided, however, that]
notwithstanding the assignment by Developer and the assumption by Transferee in this
Assignment, Developer is not released from, and remains fully liable for all obligations and
liabilities with respect to: (i) matters or circumstances (including any payment obligations) which
relate to or arose during the period that Developer was the “Developer” under the DDA and for
the Additional Liability Period, as applicable;(ii)the releases set forth in Section 4.5.2(f) of the
DDAor in any of the other Property Documents, (iii)the indemnities set forth in Sections 5.5,
8.12(e), 8.15, 8.16, 10.1, 10.2 and 17.12.1 of the DDAand indemnities in any of the other
Property Documentsfor matters Accruing during the period that such transferor was Developer
hereunder and for the Additional Liability Period as applicable;and (iv) any of Developer’s
obligations under the Property Documentsto the extent that the same arise prior to the
Assignment Effective Date or subsequently if arising due to the acts or omissions of Developer
and/or any Developer Affiliate or Developer Representative;
{Applies only if one of the following is applicable}
(f)[Further confirms that
notwithstanding the assignment by Developer and the assumption by Transferee inthis
Assignment, Developer is not released from, and remains fully liable for all obligations and
liabilities:]
[{Applies only if there is Property retained by
(i)
Developer}
under the Property Documents which relate to any other portion of the Developer
Parcels, the Property or the Project that is not subject to the foregoing Transfer Event and as to
which Developer has not been theretofore released in accordance withthe Property Documents];
and
10
Attachment 16A Assignment and Assumption Agmt.City of Tustin /Standard Pacific
Tustin Standard Pacific Assignment & Assumption Agmt 01-29-2014.docx January 29, 2014
{(ii) and (iii) Applyonly if Transfer is a Permitted
(ii)[
Transfer or if there isNo Release}
that have Accrued prior to the Assignment Effective Date
under the Property Documents and the Entitlements including, without limitation, pursuant to
any indemnity given by Developer under the Property Documents and/or the Entitlements,and
(iii)in addition to all of the obligations of Transferee
under the Property Documents, Developer remains jointly and severally liable with Assignee for
all the obligations under the Property Documents relating tothe Transfer Parcel, including,
without limitation, for the following: (i) construction of the Improvements, (ii) payment of the
Project Fair Share Contribution, and (iii) performance of Developer’s maintenance obligation
and all release and indemnity obligations of Developer set forth in the Property Documents with
respect to the Transfer Parcel.]
(g)Acknowledges the new addresses for Notices for Transferee set forth in the
Assignment and agrees that such new addresses shall be the effective notice addresses for the
Developer from and after the Assignment Effective Date under the Property Documents and the
Entitlements.
{remainder of page is blank / City signature follows}
11
Attachment 16A Assignment and Assumption Agmt.City of Tustin /Standard Pacific
Tustin Standard Pacific Assignment & Assumption Agmt 01-29-2014.docx January 29, 2014
This Consent by the City to the Assignment shall not constitute evidence of compliance
with or satisfaction of any obligation of Developer under any of the Property Documents, or any
other agreement between Developer and the City, except for the obligation of Developer to
obtain the City’s consent to any Transfer.
CITY:
CITY OF TUSTIN
Dated: _________, 20___By:_
Name:___________________
Title:___________________
ATTEST:
By:
APPROVED AS TO FORM:
By:_________________________
ACKNOWLEDGED AND AGREED:
DEVELOPER:
STANDARD PACIFIC CORP.,
A Delaware corporation
By:
Name:
Title:
[Add Notary Forms]
12
Attachment 16A Assignment and Assumption Agmt.City of Tustin /Standard Pacific
Tustin Standard Pacific Assignment & Assumption Agmt 01-29-2014.docx January 29, 2014
EXHIBIT “A”
Legal Description of the Development Parcels
[Insert Legal Description]
13
Attachment 16A Assignment and Assumption Agmt.City of Tustin /Standard Pacific
Tustin Standard Pacific Assignment & Assumption Agmt 01-29-2014.docx January 29, 2014
EXHIBIT “B”
Legal Description of the Transfer Parcel
[Insert Legal Descriptionof Transfer Parcel]
14
Attachment 16A Assignment and Assumption Agmt.City of Tustin /Standard Pacific
Tustin Standard Pacific Assignment & Assumption Agmt 01-29-2014.docx January 29, 2014
Attachment 16B
ATTACHMENT 16B
BUILDER TRANSFEREE
ASSIGNMENT AND ASSUMPTION AGREEMENT
CITY OF TUSTIN OFFICIAL BUSINESS
REQUEST DOCUMENT TO BE
RECORDED AND TO BE EXEMPT FROM
RECORDING FEES PER GOVERNMENT
CODE 6103 AND 27383.
Recording requested by and
when recorded mail to:
City Manager
The City of Tustin
300 Centennial Way
Tustin, CA 92780
SPACE ABOVE THIS LINE FOR RECORDER'S USE
BUILDER TRANSFEREE ASSIGNMENT AND ASSUMPTION AGREEMENT
(Parcel 1B and Parcel 6ATustin Legacy)
This BUILDER TRANSFEREE ASSIGNMENT AND ASSUMPTION AGREEMENT
AssignmentAssignment Effective Date
(“”) is made as of __________, 20__ (the “”) by and
Developer
between STANDARD PACIFIC CORP., a Delaware corporation(“”) and
Transferee
_________________, a _________________________ (“”), with the consent of the
City
CITY OF TUSTIN, a municipal corporation of the State of California (the “”), with
reference to the following matters:
A.The City and Developer entered into that certain Tustin Legacy Disposition and
Development Agreement for Disposition Parcels 1B & 6A, dated as of _________________,
DDA”
2014 (the “), relating to the conveyance from the City to Developer of that certain real
Development Parcels
property legally described on Exhibit“A”attached hereto (the “”) and the
subsequent development of the Development Parcelsby Developer, all as more particularly set
forth in the DDA. All initially capitalized terms not otherwise defined in this Assignment shall
have the meanings ascribed to such terms in the DDA.
B.The City has executed that certain Declaration of Special Restrictions for
Special Restrictions
Disposition Parcels1B and 6A(“”), dated _____________, 2014, that was
Official
recorded in the Office of the County Recorder, Orange County, California (the “
Records
”), against title to the Development Parcelson _____________, 2014as Instrument No.
__________, which includes, among other matters, certain requirements regarding the use and
maintenance of the Development Parcelsand sets forth those provisions of the DDA that survive
the issuance of a Certificate of Compliance with respect to the Project.
1
Attachment 16B Builder Transferee Assign. Agmt.City of Tustin/Standard Pacific
Tustin Standard Pacific Builder Transferee Assign. Agmt. 1-30-2014January 30, 2014
C.The City has executed thatcertain Quitclaim Deedfor Disposition Parcels 1B and
6Aand Covenants, Conditions and Restrictions, Including Environmental Restriction Pursuant
Quitclaim Deed
To Civil Code Section 1471 (“”), dated _____________, 2014, which was
recorded in the Official Records against title to the Development Parcelson _____________,
2014as Instrument No. __________, which Quitclaim Deedconveyed to Developer the fee title
to the Development Parcels, subject to certain restrictions and limitations set forth in the
Quitclaim Deed.
D.Developer and the City executed that certain Memorandum ofDisposition and
Memorandum of DDA
Development Agreement(Parcels 1Band 6A)(“”), dated
_____________,2014, which was recorded in the Official Records against title to the
Development Parcelson _____________, 2014as Instrument No. __________, and provided
record notice of the DDA.
E.Developer and the City executed that certain Tustin Legacy Development
DA
Agreement (“”), dated _______________, 2014, which was recorded in the Official Records
against title to the Development Parcelson _________________, 2014as Instrument No.
_______________.
F.Developer and the City executed that certain Profit Participation Agreement dated
Profit Participation Agreement
___________, 2014 (the “”).
G.The DDA, the Memorandum of DDA, the Special Restrictions, the DA, the
Quitclaim Deed and the Profit Participation Agreementare collectively referred to herein as the
Property Documents
“.”
H.Pursuant to the DDA, Developer agreed to develop and construct on the
Development Parcelscertain Improvements comprising the Project.
I.Concurrently with the execution and delivery of this Assignment, Developer is
conveying to Transferee a portion of the Development Parcels comprised of that certain real
TransferParcel
property legally described on Exhibit“B”attached hereto(the “”), and all
Improvements located on the Transfer Parcel, for purposes of construction by Transferee of the
On-Lot Improvements and Vertical Improvements and other Transferee Improvements (defined
below) onthe Transfer Parcel, and for sale of same, and Transferee will develop the Transfer
Parcel in accordance with the requirements of the DDA, including, without limitation, the Scope
of Development and the Schedule of Performance, and the other Property Documents.
J.The DDA imposes certain covenants, conditions, payment obligations and
restrictions on the Development Parcelsand, prior to the filing of a Certificate of Completion,
the DDA restricts Developer’s ability to transfer ownership and/or control of the Development
Parcels, the Project, the Improvements and/or Developer’s obligations with respect to the Project
(including,without limitation,Developer’s obligations with respect to the off-site infrastructure
improvements), all as set forth in the DDA.
K.Developer desires to convey the Transfer Parcelto Transferee and to assign to
Transferee all of Developer’s right, title and interest in and to the Property Documentswith
2
Attachment 16B Builder Transferee Assign. AgmtCity of Tustin/Standard Pacific
Tustin Standard Pacific Builder Transferee Assign. Agmt. 1-30-2014January 30, 2014
Transfer Event
respect to the Transfer Parcel(the “”),to have such assignment approved by the
City, and to have Transferee approved by the City as a “Builder Transferee” (as that term is
defined in and used in Section 2.2.3(b)of the DDA). Pursuant to Section2.2.3(b)of the DDA, a
Transfer must include, among other things, the execution and delivery of an assignment and
assumption agreement. Developer and Transferee are entering into this Assignment in order to
fulfill the obligations of Developer and Transferee as a Transferee under Section 2.2.3(b)of the
DDA.
L.Simultaneouslywith this Transfer Event, Transferee will be acquiring the
Transfer Parcelfrom Developer pursuant to and in accordance with the terms of the DDA.
NOW, THEREFORE, for good and valuable consideration, Developer and Transferee
agree as follows:
1.Assignment.
1.1.As of the Assignment Effective Date, Developer hereby assigns, conveys,
transfers, bargains, grants, sells and sets over to Transferee, as and to the extent owned or held
Assigned Interests
by Developer, the following (collectively, the “”):
(a)thoserightsand obligationsof Developer as the “Developer” under the
Property Documentswith respect to the Transfer Parcel, arising from and after the Assignment
Effective Date, including (i)all benefits provided to and burdens imposed upon Developer
pursuant to the Property Documents with respect to the Transfer Parcel, and (ii) all benefits
provided to and burdens imposed upon the Transfer Parceland all improvements thereon and all
personal property associated therewith pursuant to the Property Documents;
(b)all Entitlements and Development Permitswith respect to the Transfer
Parcel;
(c)all plans, specifications, maps, drawings, and other renderings owned by
Developer and relating to the Transfer Parcel(which assignment shall be on a non-exclusive
basis);
(d)all development rights relating to the Transfer Parcel; and
(e){Insert any additional specific rights or obligations being assigned or
assumed by the Transferee.The assignment should generally be limited to those matters related
to development construction, maintenance of On-Lot Improvements and Vertical Improvements
and sale of Homes}
1.2.The Assigned Interests together with the Transfer Parcelare collectively referred
Assigned Property
to in this Assignment as the “.”
3
Attachment 16B Builder Transferee Assign. AgmtCity of Tustin/Standard Pacific
Tustin Standard Pacific Builder Transferee Assign. Agmt. 1-30-2014January 30, 2014
2.Assumption.
2.1.Transferee, on behalf of itself and its successors andassigns, from and after the
Assignment Effective Date, hereby assumes and receives the Assigned Property and Transferee
agrees with Developer (and such agreement is expressly also made for the benefit of the City and
may be directly enforced by the City) as follows, in each case, to the extent relating to the period
from and after the Assignment Effective Date:
(a)Transferee accepts and assumes all of the Assigned Interests relating to the
Transfer Parcel, and all of the obligations, conditions, limitations and restrictions related to the
Transfer Parcel and/or the Assigned Interests imposed upon Developer under the Property
Documents.Transferee expressly assumes and shall be subject to all the obligations, conditions,
limitations and restrictions to which Developer and/or the Transfer Parcelis subject under or by
reason of the Property Documentsthat relate to the Transfer Parcel, including, without limitation,
the provisions of the release set forth in Section 4.5.2of the DDA and the indemnities set forth in
Section 10of the DDA;
(b)Transferee expressly assumes and shall be subject to all the obligations,
conditions, limitations and restrictions to which Developer and/or the Assigned Property are
subject by reason of the Entitlementsrelated to the Transfer Parcel;
(c)Upon and subject to the terms and provisions of the Property Documents,
Transferee expressly assumes and shall be subject to all the obligations to perform, construct
and/or install any and all On-Lot Improvements and Vertical Improvements {and: Insert any
additional assumed construction obligations}to be constructed on the Transfer Parcel
Transferee Improvements
(collectively, the “”) in accordance with the Scope of Development
and within the time period specified in the Schedule of Performance;
(d)Upon and subject to the terms and provisions of the Property Documents,
Transferee shall pay and perform all obligations of Developer set forth in the Property
Documents that relate to the Assigned Property, including, without limitation, the following
obligations: (i) the obligation to construct the Transferee Improvements to be constructed on the
Transfer Parcelin accordance with the Scope of Development and within the time period
specified in the Schedule of Performance; and (ii) the obligation to pay all sums required to be
paid by Developer under the Property Documents in connection with the ownership and/or
development of the Assigned Property, to the extent such amounts have not been paid as ofthe
Assignment Effective Date; and
(e){Insert any additional obligations to be assumed by Transferee.}
2.2.Transferee shall remain fully responsible to perform and satisfy all of the
obligations and liabilities assumed by Transferee pursuant to Section2.1above regardless of any
of the following:
(i)the value of the Assigned Property or the income to be
derived from theAssigned Property;
4
Attachment 16B Builder Transferee Assign. AgmtCity of Tustin/Standard Pacific
Tustin Standard Pacific Builder Transferee Assign. Agmt. 1-30-2014January 30, 2014
(ii)the existence or non-existenceof any liens, easements,
covenants, conditions, restrictions, claims or encumbrances affecting the
Assigned Property (including without limitation any of the foregoing
arising from or related to the Entitlements or any of the Property
Documents);
(iii)the suitability of the Assigned Property for any and all
future development, uses and activities which Transferee or Developer
may conduct thereon, including the development of the Project as
described in the Property Documents;
(iv)the ability of the City or any third party to complete, or
likelihood of the completion of, any of the improvements and
infrastructure described by the General Plan, the Reuse Plan, the Specific
Plan, the Tustin Legacy Backbone Infrastructure Program or any other
plan or policy of the City or any other Governmental Authorities;
(v)the compliance by the City or any third party with respect
to the Reuse Plan, the General Plan, the Specific Plan, the Special
Restrictions applicable to the Property or the specialrestrictions or other
covenants and agreements applicable to other propertyat Tustin Legacy,
the CC&Rs or any other agreement or governmental restriction or plan
affecting Tustin Legacy;
(vi)the habitability, merchantability or fitness for a particular
purpose of the Assigned Property;
(vii)the manner, quality, state of repair or lack of repair of the
Assigned Property;
(viii)the nature, quality or condition of the Transfer Parcel
including water, soil and geology;
(ix)the compliance of or by the Assigned Property and/or its
operation in accordance with any of the Entitlements or any Governmental
Requirement, including without limitation, the National Environmental
Policy Act, CEQA and the Americans with Disabilities Act of 1990;
(x)the manner or quality of the construction or materials, if
any, incorporated into any part of the Transfer Parcel or the
Improvements;
(xi)the presence or absence of Hazardous Materials, including
without limitation, asbestos or lead paint at, on, under, or adjacent to the
Transfer Parcel or any other portion of the Development Parcelsor Tustin
Legacy;
5
Attachment 16B Builder Transferee Assign. AgmtCity of Tustin/Standard Pacific
Tustin Standard Pacific Builder Transferee Assign. Agmt. 1-30-2014January 30, 2014
(xii)the content, completeness or accuracy of the information,
documentation, studies, reports, surveys and other materials, delivered to
Transferee by Developeror others in connection with Transferee’sreview
of the Assigned Property and the transactions contemplated in the Property
Documents;
(xiii)the conformity of the existing improvements on the
Transfer Parcel, if any, to any plans or specifications;
(xiv)compliance of the Assigned Property with past, currentor
future Governmental Requirements(including, without limitation, the
Entitlements)relating to zoning, subdivision, planning, building, fire,
safety, health or Environmental Matters and/or covenants, conditions,
restrictions or deed restrictions;
(xv)the deficiency of any undershoring or of any drainageto,
on or from the Transfer Parcel or any other portion of Tustin Legacy;
(xvi)the fact that all or a portion of the Transfer Parcelmay be
located on or near an earthquake fault line or falls within an earthquake
fault zone established under the Alquist-Priolo Earthquake Zone Act,
California Public Resources Code sections2621-2630 or within a seismic
hazard zone established under the Seismic Hazards Mapping Act,
California Public Resources Codesections2690-2699.6 and
sections3720-3725;
(xvii)the existence or lack of vested land use, zoning or building
entitlements affecting the Transfer Parcel;
(xviii)the construction or lack of construction of Tustin Legacy or
if constructed, the construction of Tustin Legacy in accordance with
design guidelines, plans and specifications previously or to be prepared
therefor;
(xix)the conditions, covenants and restrictions imposed upon the
Assigned Property or any portion thereof under the Property Documentsor
the Entitlements;
(xx)the contents of the Memorandum of Agreement, the
Federal Deed, the Base Closure Law and the FOST; and
(xxi)any other matters.
3.No Waiver or Modification. Nothing contained in this Assignment shall modify in any
way any other provisions of the Property Documents and/or the Entitlements. Transferee
acknowledges that it is taking title to and is assuming the Assigned Property subject to, among
other things, the rights of the City as described in the Property Documents.
6
Attachment 16B Builder Transferee Assign. AgmtCity of Tustin/Standard Pacific
Tustin Standard Pacific Builder Transferee Assign. Agmt. 1-30-2014January 30, 2014
4.Additional Documents. Developer and Transferee shall each execute and deliver to the
other party, upon demand, such further documents, instruments and conveyances, and shall take
such further actions as are necessary or desirable to effectuate the intent and purposes of this
Assignment.
5.Miscellaneous.
5.1.Modification. No amendment, change, modification or supplement to this
Assignment shall be valid and binding on Developer or Transferee unless it is represented in
writing and signed by both Developer and Transferee. No amendment, change, modification or
supplement to this Assignment shall be deemed to be part of the consent or deemed to be
consented to by the City, unless the City executes a separate written consent to such amendment,
change, modification or supplement.
5.2.Applicable Law. This Assignment shall be governed by, interpreted under,
construed and enforced in accordance with the laws of the State of California, irrespective of
California’s choice-of-law principles.
5.3.Binding Effect. This Assignment and the terms, provisions, promises, covenants
and conditions hereof shall be binding upon and inure to the benefit of Developer and Transferee
and their respective heirs, legal representatives, successors and assigns.
5.4.Counterparts. This Assignment 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
Assignment shall not be effective until the execution and delivery by Developer and Transferee
of at least one set of counterparts (together with an executed counterpart of the City’s consent
attached to this Assignment). A counterpart of this Assignment that is executed and delivered
electronically (by facsimile machine or email) shall not be effective unless an ink-signed original
executed copy of the signature page of this Assignment is also promptly delivered to the other
party, and such ink-signed original executed page is actually received by the other party.
Developer and Transferee hereby authorize each other to detach and combine original signature
pages and notarial acknowledgements and consolidate them into a single identical original. Any
one of such completely executed counterparts shall be sufficient proof of this Assignment as a
duly and validly executed agreement.
5.5.City as Third Party Beneficiary.Developer and Transferee hereby acknowledge
and agree that until theCertificate of Compliance is recorded in the Official Records, the City
shall be an intended third party beneficiary under this Assignment and the City shall have the
right to enforce the terms and provisions of this Assignment applicable to the City. Other than
the City, there shall be no third party beneficiaries of this Assignment.
5.6.Notices. From and after the Amendment Effective Date, all notices that the City
deliversto the “Developer” under the Property Documents and/or the Entitlements with respect
to the Transfer Parcelshall also concurrently be delivered to Transfereepursuant to Section17.6
of the DDA at the following addresses:
7
Attachment 16B Builder Transferee Assign. AgmtCity of Tustin/Standard Pacific
Tustin Standard Pacific Builder Transferee Assign. Agmt. 1-30-2014January 30, 2014
Transferee:
[__entity_______]
_______________________
_______________________
_______________________
with a copy to:
[legal counsel]
_______________________
_______________________
_______________________]
[signature page follows]
8
Attachment 16B Builder Transferee Assign. AgmtCity of Tustin/Standard Pacific
Tustin Standard Pacific Builder Transferee Assign. Agmt. 1-30-2014January 30, 2014
Developer and Transferee each has caused this Assignment to be duly executed by its
duly authorized officer as of the Assignment Effective Date.
“DEVELOPER”
Standard Pacific Corp.,
a Delaware corporation
By: ________________________
Name: ______________________
Dated: __________________Title: ________________________
“TRANSFEREE”
[___entity___],
a _______________________________
Dated: __________________
By:
Name:
Title:
By:
Name:
Title:
{City consent on next page}
9
Attachment 16B Builder Transferee Assign. AgmtCity of Tustin/Standard Pacific
Tustin Standard Pacific Builder Transferee Assign. Agmt. 1-30-2014January 30, 2014
ACKNOWLEDGMENT AND CONSENT BY CITY OF TUSTIN
By executing in the space set forth below, the City of Tustin hereby:
(a)Acknowledgesreceipt of the Assignment and Assumption Agreement
Assignment
(the“”) to which this Consent is attached;
(b)Consentsto the Transfereeas provided in Section 2.2.3(b)(i)(H), subject to the
terms and conditions set forth in the Assignment;
(c)This Consent by the City constitutes the consent required pursuant to
Section2.2.3(b)of the DDA and constitutes City’s acknowledgment that the requirements of
Section2.2.3(b)have been satisfied;
(d)Agrees that [ insert name of Transferee], a _____________________(the
assignee in the Assignment) shall be deemed by the City to be the “Builder Transferee” under the
DDAwith respect to the Transfer Parcel, from and after the Assignment Effective Date;
(e)Confirms that notwithstanding the assignment by Developer and the assumption
by Transferee in this Assignment, Developer is not released from, and remains fully liable for all
obligations and liabilitiesunder the Property Documents and the Entitlements:
(i)which relate to any other portion of the Developer Parcels,
the Property or the Project that is not subject to the foregoing Transfer Event; and
(ii)that have Accrued prior to the Assignment Effective Date
under the Property Documents and the Entitlements including, without limitation, pursuant to
any indemnity given by Developer under the Property Documents and/or the Entitlements, and
(iii)in addition toall of the obligations of Transferee under the
Property Documents, Developer remains jointly and severally liable with Assignee for all the
obligations under the Property Documents relating to the Transfer Parcel, including, without
limitation, for the following: (A) construction of the Improvements, (B) payment of the Project
Fair Share Contribution, and (C) performance of Developer’s maintenance obligation and all
release and indemnity obligations of Developer set forth in the Property Documents with respect
to the Transfer Parcel.
(f)Acknowledges the additional addresses for Notices for Transferee set forth in the
Assignment and agrees that from and after the Assignment Effective Date all notices from City
to Developer under the Property Documents and the Entitlementswith respect to the Transfer
Parcel shall also be delivered to Transferee at such addresses.
{remainder of page is blank / City signature follows}
10
Attachment 16B Builder Transferee Assign. AgmtCity of Tustin/Standard Pacific
Tustin Standard Pacific Builder Transferee Assign. Agmt. 1-30-2014January 30, 2014
This Consent by the City to the Assignment shall not constitute evidence of compliance
with or satisfaction of any obligation of Developer under any of the Property Documents, or any
other agreement between Developer and the City, except for the obligationof Developer to
obtain the City’s consent to any Transfer.
CITY:
CITY OF TUSTIN
Dated: _________, 20___By:_
Name:___________________
Title:___________________
ATTEST:
By:
APPROVED AS TO FORM:
By:_________________________
ACKNOWLEDGED AND AGREED:
DEVELOPER:
STANDARD PACIFIC CORP.,
A Delaware corporation
By:
Name:
Title:
[Add Notary Forms]
11
Attachment 16B Builder Transferee Assign. AgmtCity of Tustin/Standard Pacific
Tustin Standard Pacific Builder Transferee Assign. Agmt. 1-30-2014January 30, 2014
EXHIBIT “A”
Legal Description of the Development Parcels
[Insert Legal Description]
12
Attachment 16B Builder Transferee Assign. AgmtCity of Tustin/Standard Pacific
Tustin Standard Pacific Builder Transferee Assign. Agmt. 1-30-2014January 30, 2014
EXHIBIT “B”
Legal Description of the Transfer Parcel
[Insert Legal Descriptionof Transfer Parcel]
13
Attachment 16B Builder Transferee Assign. AgmtCity of Tustin/Standard Pacific
Tustin Standard Pacific Builder Transferee Assign. Agmt. 1-30-2014January 30, 2014
Attachment 17
[CityVersion]
ATTACHMENT 17
CITY DATE DOWN CERTIFICATE
REGARDING REPRESENTATIONS AND WARRANTIES
Reference is hereby made to that certain Tustin Legacy Disposition and
Development Agreement For Disposition Parcels1B and 6A dated as of
DDA
_______________, 2014(the “”), by and between Standard Pacific Corp., a
Developer
Delaware corporation (“”), and the City of Tustin, a municipal corporation of
City
the State of California (the “”). Capitalized terms used herein that are not defined
herein shall have the meanings specified in the DDA.
This Date Down Certificate is being delivered by the City pursuant to
Section7.2.1(a)(xi)of the DDA concurrently with the Close of Escrow.
The undersigned does hereby certify to Developer, in the name and on behalf of
theCity, that all of the representations and warranties made by the Cityin Section 3.3and
in Section17.12of the DDAare true and correct as of the date hereof, except as set forth
onExhibit Aattached hereto.
Without the written consent of the City: (i) no Person otherthan Developer may
rely on this Date Down Certificate for any purpose; and (ii) copies of this Date Down
Certificate may not be furnished to anyone for purposes of encouraging such reliance.
In no event shall the individual executing this Date Down Certificate on behalf of
the Cityhave any personal liability hereunder.
{remainder of page is blank –signature on next page}
1
Attachment 17 City Date Down CertificateCity of Tustin/Standard Pacific
Tustin Standard Pacific City Date Down Certificate 1-24-2014.DocJanuary 28, 2014
[CityVersion]
Dated: _____________, 20__
CITY:
CITY OF TUSTIN
By:
JeffreyParker
City Manager
APPROVED AS TO FORM
By:
David Kendig, City Attorney
Armbruster Goldsmith & Delvac LLP
Special Tustin Counsel
By:
Amy E. Freilich
2
Attachment 17 City Date Down CertificateCity of Tustin/Standard Pacific
Tustin Standard Pacific City Date Down Certificate 1-24-2014.DocJanuary 28, 2014
[CityVersion]
EXHIBIT A
[To be completed prior to Close of Escrow]
3
Attachment 17 City Date Down CertificateCity of Tustin/Standard Pacific
Tustin Standard Pacific City Date Down Certificate 1-24-2014.DocJanuary 28, 2014
Attachment 18
ATTACHMENT 18
DEVELOPERDATE DOWN CERTIFICATE
REGARDING REPRESENTATIONS AND WARRANTIES
Reference is hereby made to that certain Tustin Legacy Disposition and
Development Agreement For Disposition Parcels1B and 6A dated as of ________, 2014
DDA
(the “”), by and between Standard Pacific Corp., a Delaware corporation
Developer
(“”), and the City of Tustin, a municipal corporation of the State of California
City
(the “”). Capitalized terms used herein that are not defined herein shall have the
meanings specified in the DDA.
This Date Down Certificate is being delivered by the Developerpursuant to
Section7.2.2(b)(ix)and Section 7.2.2(b)(x)of the DDA concurrently with the Close of
Escrow.
The undersigned does hereby certify to the City,in his capacity as an officer of
Developerand forand on behalf of Developeras follows:
Allof the representations and warranties made by the DeveloperinSection 3.1of
the DDAandin Section17.12of the DDAare true and correct as of the date hereof,
except as set forth on Exhibit Aattached hereto.
1.The documentation submitted by the Developer to the City pursuant to
Section4.6of the DDA prior to the Effective Date is true and correct as of the date of this
certificate;
2.Attached to this Date Down Certificate as Exhibit Bare true and correct
copies of the certificate of good standing for Developer from the Delaware Secretary of
State and the California Secretary of State and a certificate of tax good standing for
Developer from the California Franchise Tax Board, and each attached certificate of good
standing is dated not earlier than thirty (30) days prior to the date of this Date Down
Certificate.
Without the written consent of Developer: (i) no Person other than the Citymay
rely on this Date Down Certificate for any purpose; and (ii) copies of this Date Down
Certificate may not be furnished to anyone for purposes of encouraging such reliance.
{remainder of page is blank}
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[DeveloperVersion]
In no event shall the individual executing this Date Down Certificate on behalf of
Developerhave any personal liability hereunder.
Dated: _____________, 20__
DEVELOPER:
By:___________________________
Name:________________________
Title:________________________
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[DeveloperVersion]
EXHIBIT A
[To be completed prior to Close of Escrow]
{}
Exceptions to representations and warranties
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Attachment 18 Dev Date Down CertificateCity of Tustin/Standard Pacific
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EXHIBIT B
[To be completed prior to Close of Escrow]
{}
Attach Certificate of Good Standing fromCalifornia Secretary of State
{}
Attach Certificate of Good Standing from California Franchise Tax Board
4
Attachment 18 Dev Date Down CertificateCity of Tustin/Standard Pacific
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Attachment 19
Attachment 20
ATTACHMENT 20
DECLARATION OF SPECIAL RESTRICTIONS
FOR DISPOSITION PARCELS1B&6A
CITY OF TUSTIN OFFICIAL BUSINESS
REQUEST DOCUMENT TO BE
RECORDED AND TO BE EXEMPT
FROM RECORDING FEESPER
GOVERNMENT CODE 6103 AND 27383.
Recording requested by and
When recorded mail to:
The City of Tustin
300 Centennial Way
Tustin, CA 92780
Attn: City Manager
SPACE ABOVE THIS LINE FOR
RECORDER'S USE
DECLARATION OF SPECIAL RESTRICTIONS
FOR DISPOSITION PARCELS1B&6A
This DECLARATION OF SPECIAL RESTRICTIONS FOR DISPOSITION PARCELS1B&6A
DeclarationEffective Date
(this “”), is made as of ____________________, 2014(the “”) by the
City
CITY OF TUSTIN, a municipal corporation of the State of California (“”), and is
Developer
acknowledged bySTANDARD PACIFIC CORP., a Delaware corporation (“”).
A.Pursuant to the Defense Base Closure and Realignment Act of 1990 (Part A of Title
Base Closure
XXIX of Public Law 101-510; 10 U.S.C. Section 2687 Note), as amended(the “
LawMCAS Tustin
”),the Marine Corps Air Station-Tustin (“”) located substantially in the City of
Tustin, California was closed by the United States of America, acting by and through the
Navy
Department of the Navy (the “”). In 1992, the City was designated as the Lead Agency or
Local Redevelopment Authority for preparation of a reuse plan for MCAS Tustin in order to
facilitate the closure of MCAS Tustin and its reuse in furtherance of the economic development of
the City and surrounding region.
B.In May 2002, the Navy and the City entered into that certain Agreement Between
the United States of America and the City of Tustin, California for the Conveyance of a Portion of
Navy Conveyance
the Former Marine Corps Air Station Tustin dated as of May 13, 2002 (the “
Agreement
,”) pursuant to which the Navyagreed to convey 1,153 acres of MCAS Tustin to the
City.The 1,153 acres of MCAS Tustin located within the City of Tustin and either conveyed by
the Navy to the City or subject to ground lease between the Navy and the City is referred to in this
Tustin Legacy
Declaration as “”.
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C.The City owns a fee interest in the Development Parcels(defined below), which
constitutes a portion of Tustin Legacy. The City also owns that certain real property located in the
City of Tustin, County of Orange, California comprising a portion of TustinLegacy and legally
City Benefited
described on Attachment No. 2attached hereto and made a part hereof (“
Property
”), which property is proximateto and directly affected by the use and maintenance of
the Development Parcels.
D.The City and Developer enteredinto that certain Tustin Legacy Disposition and
Development Agreement for Disposition Parcels1B &6A, dated as of ______________, 2014,
pursuant to which Developer has agreed to purchase the Development Parcels from the City upon
and subject to the termsand conditions set forth therein, and as the same may hereafter be further
DDA
amended, modified or supplemented in accordance with its terms, collectively, the “”.The
DDAis evidenced by that certain Memorandum of Tustin Legacy Disposition and Development
Agreement for Disposition Parcels1B &6A (as the same may hereafter be amended, modified or
Memorandum of DDA
supplemented,the “”), dated as of the Effective Date and Recorded
immediately prior tothe Recordation of this Declaration.Capitalized terms not otherwise defined
herein shall have the meaning set forth for such terms in the DDA and such terms are hereby
incorporated by this reference.
E.Upon the Effective Date,Developer is acquiring the Development Parcelsand has
agreed to develop the Projectas acommunity of residentialhomes for sale to members of the home
Homeowners
buying public (“”),together with publicly accessible privately owned Parkand Park
Facilities, Greenbelt Areas, Landscape Areasand Private Streetsand Sidewalks that will be made
available to the public and certainCommon Area amenities restricted to use by Homeowners
pursuant to and in accordance with the DDAand the Final Map.
F.The City intends that Developer and its Successor Ownersshall use and maintain
the DevelopmentProperty (defined below) in accordance with this Declaration and the
Restrictions and following the completion of the Project pursuant to the DDA,as a High Quality
Residential Project, as more particularly set forth hereinand in the DDA.For purposes of this
Property Owner
Declaration, the term “” shall mean the Developer andeach Successor Owner of
the Development Property or any portion thereof, but shall specifically excludethe following
End Users
(referredto herein collectively as “”): (a) each Homeownerwho purchases a Lot/Home,
and(b) any Homeowners’Association with respect to any Common Areas within the
Development Parcelsconveyed to the Homeowners’Association.
G.To create and preserve the value, desirability and attractiveness of the Development
Property,each Property Ownerwill hereafter hold and convey title to the Development Property
owned by it subject to those certain protective covenants, conditions and restrictions set forth
herein, which restrictions shall be applicable for the Term (defined below).
H.The City now desires to impose on the Development Propertythis Declaration, for
these purposes, among others: (a) to preserve the general plan for the use and maintenance of
Tustin Legacy, including of the Development Parcels,through development and maintenance of a
High Quality Residential Project upon the Development Parcels;(b) to ensure proper use and
maintenance of the Project;and (c) to protect each owner of the Development Propertyand nearby
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owners and residents including the residents of the City of Tustin, from improper use of the
Development Property,in each case upon and subject to the terms of this Declaration.
I.This Declaration also sets forth those rights of the Cityand, upon acquisition by
Developer, certainobligations of Property Owner specified in the DDA or otherwise, each of
which shall remain in full force and effect for theapplicableTerm,notwithstanding the
termination of the DDA and/or the issuance by the City of a Certificate of Compliance for the
Project.
NOW, THEREFORE, the City hereby covenants and declares that the Development
Parcelsarenow held and shall hereafter be held, transferred,conveyed, sold, leased, subleased,
encumbered, mortgaged, used, occupied and improved subject to the covenants, conditions and
restrictions herein set forthfor the Term,each and all of which is and are for, and shall inure to the
benefit of and pass with, the Development Parcelsand every portion of or interest in the Project
and shall apply to Declarantandeach Property Owner, to the extent set forth herein,for the
purpose of uniformly enhancing and protecting the value, attractiveness and desirability of the
Development Parcelsand Tustin Legacyin furtherance of a general plan for the protection,
maintenance, subdivisionand improvement of Tustin Legacy or any portion thereof. For the Term
of this Declaration, the covenants, conditionsandrestrictions set forth in the Declaration shall run
withthe Development Parcelsand shall be binding upon Developer and each and every Successor
Owner having any right, title or interest in the Development Parcelsor any part thereofand shall
inure to the benefit of the City Benefited Propertyand the City.
The City hereby further declares as follows:
Property Affected by this Declaration
1.. Theproperty affected by this Declaration is the
Development Property,Development Parcels
“” consisting of (a) the “,” comprised of 74 gross
acres of land, more or less, located in the City of Tustin, County of Orange, California which land
is legally described on Attachment 1attached hereto and incorporated herein by this reference;(b)
all improvements, now existing or hereafter constructed,located on the Development Parcels,and
(c) all appurtenancespertaining to the Development Parcels.
Covenants, Conditions and Restrictions
2.: For the benefit of the City Benefited Property
and the City, and as an inducement for the City to consummate thetransactions contemplated by
the DDA, but subject to Section4.2, the violation of any of the Restrictions (as hereinafter defined)
set forth in this Section2for the Term, shall at the City’s option constitute a Material Default
hereunder and entitle the City to exercise any of the rights and remedies set forth herein. The
covenants, conditions,restrictions and agreements set forth in this Declaration are collectively
Restrictions
referred to herein as the “.”
Use Covenants and Restrictions
2.1..From and after the acquisition of fee title to the
Property by Developer, Developer and each Successor Owner shall cause the Development
Parcels to be developed(a) only for lawful residential uses and such uses as are ancillary or
incidental theretoand (b) as aHigh Quality Residential Project.
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Maintenance Covenantsand Restrictions
2.2..
2.2.1.From and after the acquisition of fee title to the Property by Developer,
Developer and each Successor Owner shall maintain theHorizontal Improvements and all
buildings(including Homes),structures, landscaping, Private streetsand Sidewalks,and all other
roads, drives, bike paths, alleyways, sidewalks, utilities, Common AreaImprovements,
Landscaping Improvements, hardscaping, fountains and similar improvements constructed on the
Improvements
Development Parcelsfrom time to time (collectively, the “”)and the Development
Parcels,consistent with the following requirements:
(a)Prior to commencement of construction, Property Ownershall be
responsible, at its sole cost and expense, (i) to secure and maintain theDevelopment Propertyin a
clean, safe and secure condition, in compliance with all applicable laws, (ii) to abate weeds and
other hazards and nuisances on the Development Property, (iii) to erect and maintain barricades
and fencing, and provide security, in each casewith respect to the Development Parcelsas
reasonably necessary to protect the public and any Improvements already constructed, and (iv) to
maintain (in compliance with all Environmental Laws) erosion controlon the Development
Parcels.
(b)From the date of commencement and during the continuance of
construction of any Improvements on the Development Parcelsand until Completion thereof,
Property Ownershall maintaintheDevelopmentParcelsand the Improvements thereon then under
construction consistent with normal and customary construction industry practice.
(c)From and afterthe issuance of a certificate of occupancy for any
Improvements and prior to the transfer thereof by Property Ownerto an End User,Property Owner
shall maintainall Improvements on theDevelopmentParcelsnot then under constructionin a
clean, sanitary, orderly and attractive condition, and in accordance with High Quality Residential
Standards, subject to reasonable wear and tear,and in accordance with the requirements of the
Landscape Maintenance Agreement and, further subject to Section 2.2.1(e),change or damage by
casualtyor condemnation. Property Ownershall be required to meet the standard for the quality of
maintenance of the Improvements on the Development Parcels required by this Section 2.2.1(c)
regardless of whether or not a specific item of maintenance is listed below, except that, in each
case, and notwithstanding anything in thisSection 2.2.1tothe contrary, Property Ownershall not
have any maintenance obligation with respect to any Completed Improvements owned or
controlled by (or on property owned or maintained by) any End Userorwith respect to any
Completed Improvements owned by any utility, Governmental Authority, lighting or landscape
district or, except as set forth in the Landscape Maintenance Agreement, by the City.
Representative items of maintenance shall include: (i) maintenance, repair and replacement on a
regularschedule, consistent with High Quality Residential Standards, of allImprovements;(ii)
regular inspection for graffiti or damage or deterioration or failure, and reasonably prompt (or, in
the case of graffiti, within 48 hours) repainting or repair or replacement of all surfaces, fencing,
walls, equipment, etc., as necessary; (iii) emptying of trash receptacles and removal of litter; (iv)
regular sweeping of Private Streetsand Sidewalksthroughout the Development Parcels;
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(v) fertilizing, irrigating, trimming and replacing vegetation and other Landscaping Improvements
as necessary; (vi) cleaning exterior windows on a regular basis; (vii) painting the buildings on a
regular program and prior to the deterioration of the painted surfaces; and (viii)conducting roof
inspections on a regular basis and maintaining roofs in a leak-free and weather-tight condition.
(d)Except as otherwise provided in this Section, the maintenance
responsibilities of all Property Owners shall be vested in one entity at any given time during the
Term.Property Owners’obligations under Section 2.1 shall terminate with respect to any portion
of the Development Parcelstransferred to an End User and such termination shall be effective
automatically upon such transfer.Property Ownershall have the right (i) to assign its maintenance
responsibilities under this Declarationto a Homeowners’ Association, upon which assignment
Property Ownershall have no further liability under this Section 2.2.1,(ii) to subcontract its
maintenance responsibilities under this Declaration to such Homeowners’ Association or an
Affiliate of Developer or a first class property management company provided that such
subcontracting shall not relieve Property Ownerof any liability for its obligations under this
Section 2.2.1and(iii) to assign its maintenance obligations to a Builder Transferee with respect to
those portions of the Development Property conveyed to Builder Transferee; provided, however
that such assignment shall not relieve Property Ownerof its maintenance obligations under this
Section 2.2.1.
(e)In the event of casualty,Property Ownershall, in its sole discretion,
either (i) promptly repair the Improvementsand prior to commencement of such repair maintain
the portions of the Development Propertysubject to casualty in accordance with Section 2.2.1(a)
or (ii) if Property Ownerdetermines in its sole discretion not to repair such Improvements,
maintain the portions of the Development Propertysubject to casualty in accordance with Section
2.2.1(a). In each case, upon commencement of any construction with respect tothe affected
portions of the Development Propertyand until completion of the repair work,Property Owner
shall comply with the requirements set forth in Section 2.2.1(b)above and upon completion of the
repair work, shall comply with the requirements set forth in Section 2.2.1(c). Notwithstanding the
foregoing, the portions of the Development Propertyunaffected by any such casualty shall be
maintained as otherwise required by this Declaration and, including pursuanttoSection 2.2.1(c),
and unless not economically feasible due to cost or physical proximity as demonstrated to the
reasonable satisfaction of the City, Property Ownershall provide landscaping or other barriers to
shield the portions of the Development Propertyremaining in use and adjacent public roadways
from those subject to casualty in order to maintain the unaffected portions of the Development
Parcelsand the Improvementsthereonas required pursuant to Section 2.2.1(c) (b) and (c).
(f)If Property Ownerfails to maintain the Development Propertyor
any portion thereof inaccordance with the requirements of this Declarationand the same
constitutes a Material Default by Property Ownerhereunder, the City or its designee shall have the
right but not the obligation to enter the Development Propertyupon reasonable notice to Property
Owner, correct such failure, and hold Property Ownerresponsible for the costthereofand such
cost, untilpaid, shall constitute a lien on the applicable portion of the Development Property as and
to the extent described in Section 6.4.
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Profit Participation Price.
2.3.Developer and each Successor Owner shallpay to the
City the Profit Participation Pricepursuant to the terms and conditions of the Profit Participation
Agreementexecuted by the Parties.
Obligation to Refrain from Discrimination
2.4..There shall be no discrimination
against or segregation of any person, or group of persons, on account of sex,race, color, religion,
ancestry, national origin, disability, medical condition, marital status, or sexual orientation in the
sale, lease, transfer, use, occupancy, tenure or enjoyment of the Development Property or in
development of the Project, nor shallProperty Ownerestablish or permit any such practice or
practices of discrimination or segregation with reference to the selection, location, number, use or
occupancy of tenants, lessees, subtenants, sublessees or vendees of the Development Property or
in development of the Project.
DDA Provisions
2.5..Pursuant to theDDA, the City has imposedcertain covenants,
conditions and restrictions on the Development Parcels, including the releases contained in
Section 4.5.2 of the DDA, and certain environmental indemnity and environmental provisions,
each of which is set forth verbatim below in italics and each of which is hereby declared to be a
covenant running with the land, binding Developer and eachSuccessor Owner for the Term of this
Declaration. Within theitalicized language which follows, section references shall be to sections
of the DDA and certain terms shall have the following meaningsand the remaining terms shall
have the meanings set forth in the DDA: the term “Agreement” shall mean the DDAas defined in
this Declaration; the terms “Close of Escrow” and “Closing Date” shall mean the Effective Dateof
this Declaration; the term “Property” shall mean the “Development Property” as defined in this
Declaration; the term “Quitclaim Deed” shall mean that certain “Quitclaim Deed”pursuant to
which the City shall convey the Property to Developer at the Close of Escrow, which shall be
Recorded immediately following Recordingof this Declaration; the term “Special Restrictions”
shall mean this Declaration; and the term “City Benefited Property” shall mean the “City
Benefited Property” as defined herein.
Releases
2.5.1..Section 4.5.2(f)and (g)of the DDA provides as follows:
(f)Release
. Developer, on behalf of itself and each Successor Owner and every
Person claiming by, through or under Developer or any Successor Owner (each a
Releasing Party
“”), hereby waives, as of the Effective Date, and agrees to waive, as of
the Close of Escrow, the right of each Releasing Party to recover from, and fully and
irrevocably releases, the City and its elected and appointed officials, employees, agents,
attorneys, affiliates, representatives, consultants, contractors, successors and assigns
Released PartyReleased Parties
(individually, a “” and collectively, the “”) from any
and all Claims that Developer or any Releasing Party may now have or hereafter suffer
or acquire arising from or related to: (i)any Due Diligence Information, (ii) any
condition of the Property or any current or future improvement thereon, known or
unknown by any Releasing Party or any Released Party, including as to the extent or
effect of any grading of the Development Parcels; (iii) any construction defects, errors,
omissions or other conditions, latent or otherwise; (iv)economic and legal conditions
on or affecting the Property or any improvements thereon; (v) Environmental Matters,
including the existence, Release, threatened Release, presence, storage, treatment,
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transportation or disposal of any Hazardous Materials at any time on, in, under, or
from, the Property or any current or future improvement thereon or any portion thereof;
(vi)Claims of or acts or omissions to act of any Governmental Authority or any other
third party arising from or related to any actual, threatened, or suspected Releaseof a
Hazardous Material on, in, under, or from or about the Property or any current or
future improvement thereon, including any Investigation or Remediation at or about the
Property or any current or future improvement thereon; and/or (vii)arising from the
Tustin Legacy Backbone Infrastructure Program, any community facilities district or
assessment district the cost or extent thereof, or the amount of the Project Fair Share
Contribution or any community facilities district or assessment district assessment
against the Development Parcels described in this Agreement or the DA; provided that
the foregoing release by the Releasing Parties shall not extend to the extent of (A) any
breach by the City of any of the representations or warranties of the City setforth in
Sections 3.3 or 17.12 of this Agreement, (B) any breach by the City of any of the
covenants or obligations set forth in this Agreement or any Other Agreement, (C) any
Claim that is the result of the gross negligence, willful misconduct or fraud of the City or
any of the Released Parties, (D) any actions of the City or any of the Released Parties
which occur following the Close of Escrow with respect to the Property, or (E) any other
Claims against City relating to or arising out of tort Claims brought by third parties
against Developer, to the extent such claims are based upon the Active Negligence of
the City or any Released Parties and Accruing prior to the Close of Escrow; provided
that the exceptions in clause (C) and (E) above shall not apply with respect to any
matter for which the City is indemnified pursuant to Section 5.5 or Section 10.2. This
release includes Claims of which Developer is presently unaware or which Developer
does not presently suspect to exist which, if known by Developer,would materially
affect Developer’s release of the Released Parties. Developer specifically waives the
provision of California Civil Code Section1542, which provides as follows:
“A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS
WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO
EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING
THE RELEASE, WHICH IF KNOWN BY HIM OR HER MUST
HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT
WITH THE DEBTOR.”
In this connection and to the extent permitted by law, Developer on behalf of itself, and
the other Releasing Parties hereby agrees that (x) it realizes and acknowledges that
factual matters now unknown to it may have given or may hereafter give rise to Claims
or controversies which are presently unknown, unanticipated and unsuspected, (y) the
waivers and releases in this Section 4.5.2(f) have been negotiated and agreed upon in
light of that realization and (z) Developer, on behalf of itself and the other Releasing
Parties, nevertheless hereby intends to release, discharge and acquit the Released
Parties from any such unknown Claims and controversies to the extent set forth above.
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BY INITIALING BELOW, DEVELOPER ACKNOWLEDGES THAT
(A)IT HAS READ AND FULLY UNDERSTANDS THE
PROVISIONS OF THIS SECTION, (B)IT HAS HAD THE
CHANCE TO ASK QUESTIONS OF ITS COUNSEL ABOUT ITS
MEANING AND SIGNIFICANCE, AND (C)IT HAS ACCEPTED
AND AGREED TO THE TERMS SET FORTH IN THIS SECTION.
_____________________________________________
CITY’S INITIALSDEVELOPER’S INITIALS
This release shall run with the land for the benefit of the City Benefited Property and the
City and each Successor Owner owning all or any portion of such City Benefited
Property from and after the acquisition of the Development Parcels by Developer,
burdening the Development Parcels and Developer and the Successor Owners owning
all or any portion of the Development Parcels and all Persons claiming by, through or
under Developer or any Successor Owner of the Development Parcels or such portion
thereof and to further evidence its effectiveness with respect to Developer and the
Successor Owners of the Development Parcels, shall be included in its entirety in the
Quitclaim Deed.
(g)The provisions of this Section 4.5.2 shall survive the Close of Escrow and the
termination of this Agreement and shall not be merged with the Quitclaim Deed.
Local, State and Federal Laws
2.5.2.. The applicable portion of Section
8.15of the DDA provides as follows:
“Developer hereby agrees that, with respect to the Project, Developer shall indemnify,
defend andhold the City and its elected and appointed officials, employees, agents,
attorneys, affiliates, representatives, contractors, successors and assigns free and
harmless from and against any and all Claims arising from or related to compliance by
Developer or Developer’s officers, directors, employees, agents, representatives,
consultants and/or contractors (at every tier) in construction of the Project with the
prevailing wage requirements imposed by any applicable federal and State labor laws.
The indemnity set forth in this Section shall survive the termination of this Agreement.”
Liens, Taxes and Assessments
2.5.3..Section 8.16of the DDA provides as
follows:
8.16Liens, Taxes and Assessments
.Developer shall pay prior to delinquency allreal
estate taxes and assessments assessed and levied on or against all portions of the
Property or the Improvements during the period of ownership thereof by Developer.
Developer shall not place, or allow to be placed, on its interests in the Property, or any
Lot or Home, or any portion thereof, any Mortgage or encumbrance of lien not
authorized by this Agreement. Developer shall remove, or shall have removed, any levy
or attachment made on its interests in the Property or the Improvements (or any portion
thereof), or shall assure the satisfaction thereof within thirty (30) calendar days
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following receipt of notice thereof. Except as set forth in Section 8.7.3(i), nothing
contained in this Agreement shall be deemed to prohibit Developer from contesting the
validity or amount of any tax or assessment or to limit the remedies available to
Developer in respect thereto. Developer hereby agrees to indemnify, defend and hold
the Cityand its elected and appointed officials, employees, agents, attorneys, affiliates,
representatives, contractors, successors and assigns free and harmless from and
against any and all Claims arising with respect to payment of liens, taxes and
assessments assessed or levied against the Property and/or the Improvements during
the period of ownership thereof by Developer. The indemnity set forth in this Section
shall survive the termination of this Agreement.
Indemnity.
2.5.4.Section 10.1of the DDA provides as follows:
10.1Developer’s Indemnification
.As a material part of the consideration for this
Agreement, effective upon Close of Escrow, and to the maximum extent permitted by
law, Developer shall indemnify, protect, defend, assume all responsibility for and hold
harmless the City Indemnified Parties, from and against any and all Claims to the extent
caused by the following:
(a)Developer’s marketing, sale or use of the Property in any way;
(b)All acts and omissions of Developer in connection with the Project, the
Property, the Improvements or any portion of any of the foregoing;
(c)Any plans or designs for Improvements prepared by or on behalf of
Developer, including any errors or omissions with respect to such plans or designs;
(d)Any loss or damage to the City resulting from any inaccuracy in or breach
of any representation or warranty of Developer, or resulting from any Default,
including Material Default, by Developer, under this Agreement;
(e)the non-performance or breach by Developer or the Developer
Representatives, of any term or condition of this Agreement; or
(f)Any development or construction of Improvements or other structures or
facilities by Developer or Developer’s Representatives, whether regarding the
quality, adequacy or suitability of any labor, service, equipment or material
furnished to the Property, any Person furnishing the same, or otherwise.
Notwithstanding anything to the contrary set forth in this Section 10.1, the foregoing
indemnities shall not apply to and Developer shall not be obligated to indemnify any of
the City Indemnified Parties with respect to the foregoing to the extent such Claims are
a result of: (i) any breach of any covenant or representation or warranty by City under
this Agreement, (b) the gross negligence, willful misconduct or fraud of City or any City
Indemnified Party; or (c) any other Claims against the City relating to or arising out of
tort Claims brought by third parties against Developer, to the extent such claims are
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based upon the Active Negligence of the City or any City Indemnified Party and
Accruing prior to the Close of Escrow. This indemnity shall remain in effect for the
period specified in Section 10.3 and shall be subject to the other terms set forth therein.
Environmental Indemnity
2.5.5..Section 10.2of the DDA provides as
follows:
10.2EnvironmentalIndemnity
.As a material part of the consideration for this
Agreement, and effective as of the Close of Escrow, Developer on behalf of itself and
Successor Owners and each and every Person claiming by, through or under Developer
or any Successor Owner, hereby agrees that Developer and each Successor Owner
shall, to the maximum extent permitted by law, indemnify, protect, defend, assume all
responsibility for and hold harmless the City Indemnified Parties from and against any
and all Claims resulting or arising from or in any way connected with the existence,
Release, threatened Release, presence, storage, treatment, transportation and/or
disposal of any Hazardous Materials on, in or under the Property, or migrating from the
Property to adjacent properties regardless whether any such condition is known or
unknown now or upon acquisition and regardless of whether any such condition
pre-exists acquisition or is subsequently caused, created or occurring; provided that
neither Developer nor any Successor Owner shall be responsible (and such indemnity
shall not apply) to the extent of (a) any breach of any covenant or representation or
warranty by City under this Agreement, (b) the gross negligence, willful misconduct or
fraud of City or any City Indemnified Party, or (c) tothe extent of the Active Negligence
or willful misconduct of the City or the City’s employees, contractors or consultants
with respect to Hazardous Materials occurring prior to the Close of Escrow with
respect to work performed by such Persons on the Development Parcels. This
indemnity shall remain in effect for the period specified in Section 10.3 and shall be
subject to the other terms set forth therein. This indemnity shall not be deemed to limit
in any manner the rights and/or remedies that City, Developer or Successor Owners
may have against the Federal Government as described in Section 4.1.
Duration of Indemnities
2.5.6..The applicable portion of Section 10.3of the
DDA provides as follows:
10.3Duration of Indemnities
.The obligations of Developer with respect to each of the
indemnities set forth in Sections . . . 8.15, 8.16, 10.1and10.2. . .shall (a) survive the
Close of Escrow and shall not merge into the Quitclaim Deed, (b) survive the sale of
land to each End User and the issuance of the Notice of Completion, and (c) until the
date that is ten (10) years following issuance of the Certificate of Compliance, continue
to be binding upon Developer and Developer’s successors and assigns and each and
every prior Developer not released by the City pursuant to Section 2.2.3(a)(iii) and each
such party shall be jointly and severally liable under such provisions with respect to the
entirety of the Project and the Property. The provisions of this Section 10.3 shall
survive the termination of this Agreement.
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Claims Response
2.5.7..Section 10.4of the DDA provides as follows:
10.4Claims Response
. In the event that following the Close of Escrow, any
Environmental Agency or other third party brings, makes, alleges, or asserts a Claim,
arising from or related to any actual, threatened, or suspected Release of Hazardous
Materials on or about the Property, including any Claim for Investigation or
Remediation on the Property, or such Environmental Agency or other third party
orders, demands, or otherwise requires that any Investigation or Remediation be
conducted on the Property, Developer shall promptly upon its receipt of notice thereof,
notify the City in writing and thereafter shall promptly and responsibly evaluate and
respond to such Claim as provided in Section 10.5. Further, upon receipt of such
Claim, order, demand or requirement, Developer shall take such reasonable measures,
as necessary or appropriate, to reasonably dissuade such Environmental Agency or
other third party from bringing, making, alleging, or asserting any Claim against the
City arising from or related to any actual, threatened,or suspected Release of
Hazardous Material on or about the Property, including any Claim for Investigation or
Remediation on the Property; provided that such obligation shall not apply to those
excluded Claims set forth as (a) through (c) of Section 10.2.
Release Notification and Remedial Actions
2.5.8..Section 10.5of the DDA
provides as follows:
10.5Release Notification and Remedial Actions
.If, after Close of Escrow, any
Release of a Hazardous Material is discovered on the Property,Developer shall
promptly provide written notice (or in the event of emergency, telephonic notice,
followed by written notice) of any such Release to the City. To the extent that any
Environmental Agency (other than the City) is requiring that the City Remediate such
Release and Developer acknowledges that it is obligated to assume responsibility or
indemnify the City with respect to such Release pursuant to Section 10.2 or there is a
good faith dispute between the City and Developer as to whether Developer is obligated
to assume responsibility or indemnify the City with respect to such Release pursuant to
Section 10.2, then Developer shall (a) Remediate the Release in compliance with and to
the extent required by Environmental Laws and such Environmental Agency, or if such
removal is prohibited by any Environmental Laws, take whatever action is required by
any Environmental Law and such Environmental Agency; (b) take such other
reasonable action as is necessary to have the full use and benefit of the Property as
contemplated by this Agreement; and (c) provide the City with satisfactory evidence of
the actions taken as required in this Section. To the extent that any Environmental
Agency (other than the City) is requiring that the City Remediate such Release and the
City acknowledges that Developer is not obligated to assume responsibility or
indemnify the City with respect to such Release pursuant to Section 10.2 or no
Environmental Agency (other than the City) is requiring that the City Remediate such
Release, then (as between Developer and the City under this Agreement) Developer may
elect in its sole and absolute discretion whether to Remediate such Release and/or
pursue any rights that Developer has against any Person (including the Federal
Government and the City) with respectto such Release. The foregoing shall be without
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prejudice to Developer’s or the City’s rights against any responsible party or against
the Federal Government pursuant to the Navy Responsibilities and without
compromising the applicability of any insurance coverage in regard to such Release.
The City and Developer will coordinate any action required under this Section 10.5 with
appropriate environmental insurance carriers so as not to compromise coverage for the
costs of such actions. Nothing set forth herein requires Developer to perform any
obligation of the Federal Government and nothing set forth herein shall be deemed to
limit or impair (or take any action that might limit or impair) in any manner the rights
and/or remedies that Developer or the City may have against the Federal Government
or any other third party. The foregoing shall not apply to the Returned Property after
acquisition thereof by the City.
Conflict with Section 330 and Other Federal Government
2.5.9.
Obligations
.Section 10.6of the DDA provides as follows:
10.6Conflict with Section 330 and Other Federal Government Obligations
.
Notwithstanding anything to the contrary contained in this Section 10, in the event that
any actions required to be taken by Developer pursuant to this Section 10 could
potentially result in Developer losing rights, or are contrary to any rights, which it
otherwise would have pursuant to the Navy Responsibilities or otherwise against the
Federal Government, then the City and Developer shall meet in order to determine the
proper course of action to be taken by Developer. The course of action to be agreed
upon shall protect the City’s interest in the Project and Tustin Legacy, while retaining
for Developer its rights pursuant to the Navy Responsibilities or otherwise against the
Federal Government to the maximum extent reasonable under the circumstances.
Notwithstanding the foregoing, nothing set forth in this Section 10.6 relieves Developer
with respect to Developer’s environmental responsibilities and obligations and
environmental indemnification of Developer to the City in this Agreement.
Enforcement of Covenants.
3.
General Purpose and Constructive Notice
3.1.. This Declaration and the Restrictions
shall run and pass with each and every portion of the Development Property and be binding upon
each Property Ownerand each and every Person claiming by, through or under suchProperty
Owner,for the Term. These Restrictions shall benefit the City Benefited Property, and the City
shall retain the right to enforce the restrictions and equitable servitudes against the Development
Parcelsand the same shall be enforceable solely by the City notwithstanding any future transfer of
the City Benefited Property or any interest therein or portion thereof; provided thatno private right
of action shall exist or be implied by the existence of this Declaration. Except as specifically set
forth herein, the Restrictions shall remain in full force and effect for the Term, notwithstanding the
City’s exercise of any right or remedy herein. For the Term,Developer and each Successor Owner
that now or hereafter owns or acquires any right, title or interest in or to any portion of the
Development Property is and shall be conclusively deemed to have consented to and agreed to
every Restriction, provision, covenant, condition, right and limitation contained herein, whether or
not any reference to this Declaration is contained in the instrument by which such Person acquired
such interest in the Development Property or portion thereof.
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Transfers and Transfers of Control
3.2..Notwithstanding anything to the contrary in
this Declaration, except as set forth below, in the event that any Property Owner conveys the
Development Parcelsto another Person, the Property Owner conveying the Development Parcels
shall be released from the obligations of this Declaration first occurring from and after the
effective date of such conveyance to another Person; provided, however, that (a)the foregoing
shall not be construed to permit any Transfer or Transfer of Control by Property Owner of the
Development Parcelsor any portion thereofprior to the issuance of a Certificate of Compliance
except as permitted by the DDA, (b) during the Term of the DDA, notwithstanding any Transfers
and/or Transfers of Control, no Property Owner shall be released with respect to matters for which
it remains liable pursuant to DDASection 2.2.2(a), (b) and (c), and (c) unless it is released by the
City as set forth in DDA Section 2.2.3(a)(iii)or DDA Section 16.6, Section16.6 or otherwise by
the City in writing, each Property Owner shall remain fully liable for the obligations of Property
Ownerunder this Declaration for such period as it is Property Owner and for such longer period as
may be applicable to it during the Additional Liability Periodunder the DDA.
Inspection
3.3.. Upon twenty-four (24) hours’ notice, or such longer period as may be
explicitly set forth in this Declaration, and subject to reasonable security provisions of Property
Owner,and in addition to any rights that the City may have in its governmental capacity, the City
and its authorized representatives may from time to time enter upon and inspect the Development
Parcelsor any portion thereof or any Improvements thereon(excluding, however, the interior
space of any buildings or Homeson the Parcel)for purposes of ascertaining compliance with the
Restrictions, but without obligation to do so or liability therefor.
Other Restrictions
3.4.. This Declaration and the Restrictions contained herein are not
the exclusive source of restrictions on the use and maintenance of the Development Property.
Nothing contained herein shall prejudice or diminish in any way the City’s rights under the DDA
or the Other Agreements or its authority in its governmental capacity, nor the rights and authority
of any other Governmental Authority having jurisdiction over the Project or any portion thereof,
and the exercise of any rights or remedies by the City hereunder shall be considered separate from
and independent of anybreach or violation by Property Ownerwhich is also a breach or violation
of any Governmental Requirements.
Potential and Material Defaults
4.. In the event of any breach, violation or failure to
perform or satisfy any of the Restrictions which has not beencured within the applicable cure
period set forth below, the City may in its sole discretion enforce any one or more of the remedies
set forth in Section 4.3.
Potential Defaults.
4.1.Except as otherwise provided in this Declaration, it shall be a
Potential Default
“” if:
(a)Property Ownerfails to pay timely any sum required to be paid to
the City pursuant to this Declaration; or
(b)Property Ownerfails to perform, or delays in the performance of, in
whole or in part, any obligation required to be performed under, or otherwise violates the
provisions of this Declaration, other than as set forth in Section 4.1(a).
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Material Defaults
4.2..
Material
(a)A Potential Default under Section 4.1(a)shall become a “
Default
” if it is not cured within fifteen (15) calendar days from the date of receipt by Property
Ownerof the notice of Potential Default from the City.
Material
(b)A Potential Default under Section4.1(b)shall become a “
Default
” if it is not cured, at Property Owner’s expense, (a) within thirty(30) calendar daysfrom
the date of receipt by Property Ownerof written notice of such Potential Default from the City, or
(b) if such cure cannot be reasonably accomplished within such thirty (30) calendar day period,
within ninety (90) calendar days after receiving written notice of such Potential Default from the
City, but only if Property Ownerhas commenced such cure within suchthirty (30) calendar day
period and diligently pursues such cure to completion, or (c) within such longer period of time as
may be expressly granted by the City in the City’s sole discretion, taking into account the nature of
the Potential Default and the diligence and good faith efforts of Property Owner, as applicable,to
cure such Potential Default.The foregoing cure periods for Potential Defaults under this Section
4.2(b)shall be extended by Force Majeure Delays.
(c)Following written notice and failure to cure within the time periods
set forth in this Section4.2, each Potential Default shall become a Material Default that shall be
deemed to have occurred upon the expiration of the applicable cure period.
Certain City Remedies
4.3.. In the event of a Material Default, subject to the
Mortgagee cure rights in Section 4.5,and without limiting the rights and remedies of the City
under any other agreement, the City may do any or all of the following:
(a)The City may bring a suit for damages for any compensable breach
of or noncompliance with any of the Restrictions, or declaratory relief to determine the
enforceability of any of the Restrictions; provided, however, that (i) such damages shall be limited
to direct (actual) damages to the City for such Material Default, and (ii) the City hereby expressly
waives, releases and relinquishes any and all right to any expectation, anticipation, indirect,
consequential, exemplary or punitive damages;and/or
(b)The City may bring an action in equity or otherwise for specific
performance to enforce compliance with the Restrictions or an injunction to enjoin the continuance
of any such breach or violation thereof, whether or not the City exercises any other remedy set
forth herein, and Property Owneracknowledges that a particular or ongoing violation of one or
more of the Restrictions may cause the City to suffer material injury or damage not compensable in
money (including irreparable effects on the type and quality of development on the City Benefited
Property, Tustin Legacyor portions thereof, and/orthe maintenance of theDevelopment Property,
including without limitation, theImprovements in accordance with the standards(s) for the quality
of maintenance set forth in Section 2.2.1); and/or
(c)Any such breach or violation of the Restrictions or any provision
hereof is hereby declared to be a nuisance, and the City shall be entitled to enter the Development
Property and summarily abate and remove, without further legal process to the maximum extent
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permitted by law, any structure, thing or condition that may exist in violation of any of these
Restrictions, or to prosecute any remedy allowed by law or equity for the abatement of such
nuisance against any person or entity acting or failing to act in violation of the Restrictions, all at
the sole cost and expense of Property Owner.Such rights shall include the right of the City or its
designee to enter the Development Parcelsand to correct any Material Default by Property Owner
in the maintenance of the Improvements or landscaping on the Development Parcelsin accordance
with the Restrictions.
Failure to Timely Pay Amounts Due
4.4.. If there is a Material Defaultunder this
Declarationthen,in addition to any other remedies conferred upon the City pursuant to this
Declaration, Property Ownershall pay to the City, in additionto all principal amounts due, interest
from the date of such payment or part thereof was due until the date paid at the default rate of eight
percent (8%) per annum, compounded annually, but in no event in excess of the maximum legal
rate.
Rights of Mortgagees and Mortgagee Protection
4.5..
(a)This Declaration, including the lienrights of the City described in
Section 4.6,shall be superior in priority to all Mortgages.
(b)No breach or violation of the Restrictions shall defeator render
invalid the lien of any Mortgage or similar instrument securing a loan made in good faith and for
value with respect to the permanent financing of the Project or any portion thereof; provided,
however, that this Declaration and all provisions hereof shall be binding upon and effective against
each Property Ownerand each and every other occupant of the Development Parcelsor portion
thereof whose title is acquired by foreclosure, trustee’s sale, deed in lieu of foreclosure or
otherwise, but (i) such subsequent owner shall have a reasonable time after acquiring title in which
to cure any violations or correct and change any facts giving rise to the City’s rights under this
Declaration occurring prior to such transfer of title or occupancy and whichare reasonably capable
of being cured or changed provided that such Property Owner diligently acts to effect such cure or
change (and in the event of such diligent and timely cure, such PropertyOwner shall have no
further liability in connection with such prior violation or the continued existence of such violation
until such cure is completed), and (ii)Sections 4.1(a) and 4.1(c) shall not be applicable as to such
Property Owner with regard to any noncurable default occurring prior to the time such Property
Owneracquired title. Notwithstanding the foregoing, each Property Owner shall be required to
use the Development Parcelsin accordance with the Restrictionsset forth in this Declaration.
(c)Notwithstanding anything to the contrary set forth in the
Restrictions, this Section 4.5 shall not apply to any portion of the Development Parcels transferred
to an End User.
Lien Rights
4.6..The delinquent amount of any payments due hereunder, together
with any late charges or interest due on any such delinquent payment, reasonable attorneys’ fees,
experts’ fees and consultants’ fees and collection costs related to such delinquent payment shall, to
the greatest extent permitted by applicable law, be a lien and charge upon the Development
Property and shall be a continuing lien upon the Development Property in favor of the City
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effective upon Recordation of this Declarationandsuch lien and charge shall be paramount to the
lien and charge of any Mortgage upon the Development Property.Upon conveyance of any
portion of the Development Parcels to an End User, such lienshall automatically terminate and be
released as to such conveyed portions.
No Damages Payable by City
4.7..The City would not have executed this Declaration
if the City could become liable for damages under or with respect to this Declaration, the DDA or
the Other Agreements. Consequently, and notwithstanding any other provision of this
Declaration, exceptas specifically set forth in Section 17.5.3 of the DDA, the City shall not be
liable in damages under this Declaration, the DDA or any Other Agreement to Property Owner, or
any Person claiming by, through or under such Property Ownerand by acceptance of this
Declaration, Developer, on behalf of itself and each Successor Owner,hereby waives any and all
rights to claim damages of any kind or nature from the City except, during the term of the DDA,as
set forth in DDASection 17.5.3.
Term and Termination
5..
Residential CC&Rs
5.1..One or more new declarations of covenants, conditions and
restrictions establishing a common and general scheme for the development, improvement,
enhancement and protection of the value and desirability of the Development Property (the
Residential CC&Rs
“”) will be recordedagainstthe Development Parcels (or portions thereof) by
Developer or a Successor Owner prior to sale or lease of any individual Homes in that
Development Parcel or portion thereofor transfer of Common Areas to a Homeowner's
Association.The Residential CC&Rswill address the use and maintenance restrictions as
contained inthis Declaration, as well as various matters amongst the owners and occupants of
individual Homes and provisions required by the California Department of Real Estate in order to
obtain a finalSubdivision Public Report for sale or lease of the individual Homes. Such
Residential CC&Rsshall be prepared by Property Owner, and approved by the City in its sole and
absolute discretion. Upon recordation of the Residential CC&Rsapproved by the Cityin its sole
and absolute discretion, with respect tothe Development Parcelsor any portion thereof, the City
and Property Ownershall record a document terminating this Declaration as to the portion of the
Termination Document
Development Property covered by the Residential CC&Rs(the “”). Upon
recordation of the Residential CC&Rsand the Termination Document, the provisions of this
Declaration will no longer apply to the portion of the Development Property covered by the
Residential CC&Rsand the Termination Document.The provisions hereof shall continue to apply
to all portions of the Development Parcels not covered by Residential CC&Rsuntil such
Development Parcels or portion thereof is in turn covered by Residential CC&Rsor until
otherwise providedinSection 5.2.
Term
5.2.This Declaration and the Restrictions set forth herein shall remain in force
and effect with respect to each Lot and each lot comprising Common Area from the Effective Date
until the earlier to occur of: (a) the date whichis the twenty-fifth (25th) anniversaryof the
Effective Date (and if no Effective Date is show, from the date of Recording of this Declaration),
or (b) the date of Recording of the Residential CC&Rs and the Termination Document, unless
released at an earlier date by the City in writing.
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Miscellaneous
6..
Modification
6.1..From and after the transfer of fee title to the Development Parcelsto
Developer, no amendment, change, modification or supplement to this Declaration shall be valid
and binding unless it is representedin writing and signed by (a) the City, as the first party, and (b)
the Property Owners then owning any portion of the Development Parcelsor any interest in the
Project, as the second parties,and Recorded; provided that noconsent or approval of any End User
or any utility shall be required in order to modify or amend any provisions of this Declaration. This
Declaration shall be administered by the City Manager. Any matter to be approved by the City
shall be deemed approved, and any action to be taken bythe City shall be deemed taken, upon the
written approval by the City Manager (or his or her designee). The City Manager or his or her
designee shall have the authority to issue interpretations with respect to this Declaration and to
determine whether any action requires the approval of the City Council.
Applicable Law
6.2..This Declaration shall be governed by, interpreted under,
construed and enforced in accordance with the laws of the State of California, irrespective of
California’s choice-of-law principles.
Attorneys’ Fees
6.3..If any party to this Declaration institutes any action, suit,
proceeding, counterclaim or other proceeding for any relief against another party, declaratory or
Action
otherwise (collectively an “”), to enforce the terms hereof or to declare rights hereunder or
with respect to any inaccuracies or material omissions in connection with any of the covenants,
representations, warranties or obligations on the part of the other partyto this Declaration, then the
Prevailing Party in such Action shall be entitled to have and recover of and from the other partyall
costs and expenses of the Action, including (a) reasonable attorneys' fees which shall be payable at
the contractual hourly rate for the City's litigation counsel at the time thefees were incurred, but in
no event less than $200 per hour and (b) costs actually incurred in bringing and prosecuting such
Decision”
Action and/or enforcing any judgment, order, ruling or award (collectively, a “) granted
therein, all of which shall be deemed to have accrued on the commencement of such Action and
shall be paid whether or not such Action is prosecuted to a Decision. Any Decision entered in any
final judgment shall contain a specific provision providing for the recovery of all costs and
expenses of suit, including reasonable attorneys' fees and expert fees andcosts (collectively,
Costs
“”) incurred in enforcing, perfecting and executing such judgment. For the purposes of this
paragraph, Costs shall include in addition to Costs incurred in prosecution or defense of the
underlying action, reasonable attorneys' fees, costs, expenses and expert fees and costs incurred in
the following: post judgment motions and collection actions, contempt proceedings, garnishment,
levy, debtor and third party examinations, discovery, bankruptcy litigation and appeals of any
Prevailing Party
order or judgment. “”within the meaning of this Section 6.3includes a party
who agrees to dismiss an Action in consideration for the other party's payment of the amounts
allegedly due or performance of the covenants allegedly breached, or obtains substantially the
relief sought by such party.
Conflict of Interest
6.4.. No appointed or elected official or employee of the City shall
have any personal interest, direct or indirect, in this Declaration nor shall any official or employee
participate in any decision relating to the Declaration which affects his or her interests or the
interests of any corporation, partnership, or association in which he or she is directly or indirectly
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interested. Developer warrants that it has not paid or given and will not pay or give any third
person any money or other consideration for obtaining this Declaration.
Non-liability of City Officials and Employees
6.5.. No elected or appointed official,
representative, employee, agent, consultant, legal counsel or employee of the City shall be
personally liable under this Declaration.
Construction and Interpretation of Declaration
6.6..
(a)The language in all parts of this Declaration shall in all cases be
construed simply, as a whole and in accordance with its fair meaning and not strictly for or against
any Person.
(b)Any provision of this Declaration that is deemed to be illegal,
invalid or unenforceable by an arbitrator or court of competent jurisdiction shall be ineffective to
the extent of the invalidity or unenforceability of such provision and shall be deemed stricken from
this Declaration. Any stricken provision shall not affect the legality, enforceability or validity of
the remainder of this Declaration. If any provision or part thereof of this Declaration is stricken in
accordance with the provisions of this Section, then the stricken provision shall be replaced, to the
extent possible, with a legal, enforceable and valid provision that is as similar in tenor and intent to
the stricken provision as is legally possible.
(c)The captions of the sections and subsections in this Declaration are
inserted solely for convenience and under no circumstances are they or any of them to be treated or
construed as part of this instrument.
(d)References in this instrument to “this Declaration” mean,refer to
and include this instrument as well as any riders, schedules, exhibits, addenda and attachments
hereto (which are hereby incorporated in this Declaration by this reference). Any references to any
covenant, conditions, obligation and/or undertaking, “herein,” “hereunder,” or “pursuant hereto”
(or language of like import) shall mean, refer to and include the covenants, obligations and
undertakings existing pursuant to this Declaration and any riders, schedules, exhibits, addenda,
attachments or other documents affixed to this instrument.
(e)As used in this Declaration and as the context may require, the
singular includes the plural and vice versa and the masculine gender includes the feminine and vice
versa.
(f)As used in this Declaration the words “include” and “including”
mean respectively “include, without limitation” and “including, without limitation”.
(g)Unless otherwise indicated, references in this Declaration to
sections, paragraphs, clauses, exhibits, attachments and schedules are to the same contained in or
attached to this Declaration.
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Time of Essence
6.7..Time is of the essence with respect to all provisions of this
Declaration in which a definite time for performance is specified.
Counterparts
6.8.. This Declaration 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 Declaration
shall not be effective until the execution by the City and Developer of at least one set of
counterparts. Any one of such completely executed counterparts shall be sufficient proof of this
Declaration.
Estoppel
6.9..The City shall, fromtime to time upon not less than twenty (20) calendar
days notice from Property Owner, but not more often than annually unless in connection with a
sale or refinancing of the Parcel and/or Improvements, execute and deliver to Property Ownera
certificate in recordable form stating that this Declaration is unmodified and in full force and effect
or, if modified, that this Declaration is in full force and effect, as modified, and stating the
modifications and stating whether or not, to the actual knowledge ofthe City Manager (and
without duty of inquiry), (a) a Potential Default or Material Default by Property Ownerhas
occurred and is continuing and (b) if a Potential Default or Material Default by Property Owner
has occurred and is continuing, specifying the same. In connection with any such certificate, and
to the extent that the City still has copies thereof in its possession or control, the City shall provide
a copy of the DDA, together with all amendments, supplements and modifications thereto. Any
such certificate may be relied upon by Property Owneror any prospective purchaser or lender of
Property Owner.Property Ownershall promptly pay to the City all of the City’s actual out of
pocket third party expenses, including legal fees, and staff costs incurred with respect to the
preparation, review, and delivery of each City estoppel, provided that such expenses, fees and
costs shall not exceed Five Thousand Dollars ($5,000.00) with respect to any single estoppel.
Force Majeure ProceduresFirstParty
6.10.. If any party (the “”) believes that it is
entitled to an extension of time due to Force Majeure Delay, it shall notify the other party (the
Second Party
“”) in writing within ninety (90) calendar days from the date upon which the First
Party becomes aware of such Force Majeure Delay,generally describing the Force Majeure Delay
and its date of commencement.Upon written request from the Second Party, the First Party shall
promptly provide the following information with respect to such Force Majeure Delay:a more
detailed description of the Force Majeure Delay, when and how the First Party obtained
knowledge thereof, the steps theFirst Party anticipates taking to respond to such Force Majeure
Delay, and the estimated delay resulting from such Force Majeure Delay and responseand such
other information as the Second Party may reasonable request. The extension for Force Majeure
Delay shall be granted or denied in the Second Party’s reasonable discretion. If the First Party fails
to notify the Second Party in writing of its request for a given Force Majeure Delay within the
ninety (90) calendar days specified above, there shall be no extension for such Force Majeure
Delay.
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IN WITNESS WHEREOF, the City has executed this Declaration as of the date first set
forth above.
CITY
“”
CITY OF TUSTIN,
a California municipal corporation
By:
Jeffrey C. Parker,
City Manager
ATTEST:
___________________________________
Erica Rabe
City Clerk Services Supervisor
APPROVED AS TO FORM:
By:
David Kendig,
City Attorney
Armbruster Goldsmith & Delvac LLP
Special Real Estate Counsel to the City
By:_____________________________
Amy E. Freilich
[signatures continued on next page]
20
Attachment 20 Special Restrictions City of Tustin/Standard Pacific
Tustin Standard Pacific Special Restrictions 1-28-2014.DocxJanuary 30, 2014
BY EXECUTING THIS DECLARATION OF SPECIAL RESTRICTIONS FOR
PARCELS1B&6A, DEVELOPER ACKNOWLEDGES AND AGREES THAT, UPON
OBTAINING TITLE TO THE PROPERTY, DEVELOPER SHALL ASSUME AND BE
BOUND BY ALL OF THE OBLIGATIONS AND LIABILITIES, COVENANTS,
CONDITIONS,AND RESTRICTIONS HEREIN:
Standard Pacific Corp., a Delaware corporation
By: ________________________________
Name: ______________________________
Title: ________________________________
Date: ____________________
21
Attachment 20 Special Restrictions City of Tustin/Standard Pacific
Tustin Standard Pacific Special Restrictions 1-28-2014.DocxJanuary 30, 2014
STATE OF CALIFORNIA)
)
COUNTY OF ORANGE)____________)
On _____________________, before me, ___________________________, a notary
public, personally appeared ____________________________________ proved to me on
the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the
within instrument and acknowledged to me that he/she/they executed the same in
his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the
instrument the person(s), or the entity upon behalf of which the person(s) acted, executed
the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the
foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Signature: ____________________________(Seal)
STATE OF CALIFORNIA)
)
COUNTY OF ORANGE)
On _____________________, before me, ___________________________, a notary
public, personally appeared ____________________________________ proved to me on
the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the
within instrument and acknowledged to me that he/she/they executed the same in
his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the
instrument the person(s), or the entity upon behalf of which the person(s) acted, executed
the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the
foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Signature: ____________________________(Seal)
STATE OF CALIFORNIA)
)
COUNTY OF ORANGE)
On _____________________, before me, ___________________________, a notary
public, personally appeared ____________________________________ proved to me on
the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the
within instrument and acknowledged to me that he/she/they executed the same in
his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the
instrument the person(s), or the entity upon behalf of which the person(s) acted, executed
the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the
foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Signature: ____________________________(Seal)
ATTACHMENT 1
LEGAL DESCRIPTION OF PARCEL
[To Be Attached]
[Legal Description to include carve out of oil, gas,water rights and development rights
retained by the City]
ATTACHMENT 2
LEGAL DESCRIPTION OF CITY BENEFITED PROPERTY
ATTACHMENT 2
UVTUJOMFHBDZ
DJUZCFOFGJUFEQSPQFSUZ
Attachment 21
Attachment 22
ATTACHMENT 22
LANDSCAPE MAINTENANCE AGREEMENT
CITY OF TUSTIN OFFICIAL BUSINESS
REQUEST DOCUMENT TO BE
RECORDED AND TO BE EXEMPT
FROM RECORDING FEES PER
GOVERNMENT CODE 6103 AND 27383.
Recording requested by and
When recorded mail to:
The City of Tustin
300 Centennial Way
Tustin, CA 92780
Attn: City Manager
Space above This Line Reserved for Recorder’s Use
LANDSCAPE MAINTENANCE AGREEMENT
Agreement
This Landscape Maintenance Agreement (“”)is entered into this _______ day of
Effective Date
_________________, 2014(“”)by and between the City of Tustin, a municipal
CityDeveloper
corporation (“”)and Standard Pacific Corp.,a Delaware corporation(“”).
RECITALS
A.City and Developer have entered into that certain Tustin Legacy Disposition and
Development Agreement for Disposition Parcels 1B & 6A, dated as of _________________,
DDA”
2014 (the “)pursuant to which Developer has acquired from City that certain real
Development Parcels
property described and depicted on Exhibit “A”(“”).
B.City is the owner of certain real property adjacent to the Development Parcels described on
City Property
Exhibit “B”(“”).
C.City has approved certain entitlements with respect to the Development Parcels
Entitlements
(“”), including, without limitation,Tentative Tract No. 17505.The DDA and
the Conditions of Approval with respect to the Entitlements, including Conditions4.1,4.4,
6.2, 11.3, 11.4and 11.15of Resolution No.14-14,adopted by the Tustin City Council on
Conditions
__________, 2014 (“”), require that Developer install and maintain, among other
things, certain landscape, hardscape, irrigationand other improvements within the Developer
Landscape Area and the Boundary Landscape Area (each as defined below).As an
additional requirement of the Conditions, Developer will construct and maintain perimeter
Perimeter Walls
tract walls (“”) between the Landscape Areas(defined below) andother
portions of the real property owned by Developer or its successors in interest.
1
Attachment 22 Landscape Maintenance Agreement City of Tustin/Standard Pacific
Tustin Standard Pacific Landscape Maintenance Agreement 1-31-2014January 31, 2014
D.Developer has agreed to execute this Agreement in order to provide for Developer’s
maintenance of the Landscape Areas.This Agreement shall be a covenant running with the
land and burdening the Development Parcelsfor the benefit of the Boundary Landscape Area
and the City.
NOW, THEREFORE, in consideration of the benefits conferred, the mutual covenants and
conditions contained herein, and the duties and obligations incurred, the parties hereto agree as
follows:
AGREEMENT
1.Definitions. For purposes of this Agreement, the following capitalized terms shall have
the following meanings:
Boundary Landscape Area
“”shallmean that certainportion of the City Property:
(i)adjacent to Jamboree Road, generally located between the sound wall for Jamboree Road and
the Perimeter Walls,(ii) that front on a public street adjacent to the Development Parcels
between the back of curband Perimeter Walls,as depicted on Exhibit “C”; and (iii)comprising
the Entry Areas.
City Indemnified Parties
“” shall mean City and its appointed and elected officials,
agents, attorneys, affiliates, employees, contractors, consultants and representatives.
Default Interest Rate
“” shall mean an interest rate of eight percent (8%) per annum,
compounded annually, but in no event in excess of the maximum legal rate.
Developer Landscape Area
“”shallmean that portion of the Development Parcels
between the Perimeter Wall and the back of the curb of the public streetsadjacent to the
Development Parcels,depicted onExhibit “C”.
Developer Representatives
“”shall mean the officers, directors, employees, agents,
representatives, consultants, contractors, and other persons accessing the Landscape Areas
through or with the permission or under the direction or auspices of Developer.
Entry Areas
“” shall mean thoseportions of the City Property depicted on Exhibit “C”as
Entry Areas.
High Quality Residential Project
“” shall mean a neighborhood of single-family homes
that is of high quality and very well maintained and managed, in each case comparable to other
high quality single family developments in the City of Tustin and the City of Irvine of similar
age.
High Quality Residential Standards
“” shall mean, in terms of the quality of
maintenance, standards consistent with a High Quality Residential Project.
Homeowners’ Association
“”shallmean a homeowners’ association established pursuant
to the laws and regulations of the State of California for the management of thecommon area
developmenton the Development Parcels.
2
Attachment 22 Landscape Maintenance Agreement City of Tustin/Standard Pacific
Tustin Standard Pacific Landscape Maintenance Agreement 1-31-2014January 31, 2014
Landscape Areas
“”shall mean the Boundary Landscape Areaand the Developer
Landscape Area, collectively.
Landscape Improvements
“” shall mean any and all landscaping, irrigationand/or
hardscape improvements required by the Conditions or the DDA to be constructed in connection
with the Project upon the Landscape Area.
2.Maintenance Obligation.Upon completion by the Developer of the construction of
Landscape Improvements for all or any portion of the Landscape Areas, Developershall
maintain, repair, replace and restore, at its sole cost and expense,the Landscape Improvements
and the Landscape Areas,including, without limitation all hardscape and paving materials upon
the Entry Areas,but excluding any standard or meandering sidewalkson the Landscape Areas, in
the same aesthetic and sound condition or better as the condition ofsuch improvements atthe
,
timeoftheiracceptance bytheCityexcepting onlyreasonable wear and tearand any
necessaryreplacementof Landscape Improvements pursuant to this Agreement.Any necessary
replacements ofLandscapeImprovements shall be consistent with the Conditions and the quality
of improvements originally approved byCity and shall in addition be subject to any applicable
City review and approvals. The Landscape Areas shall be maintained in accordance with High
Quality Residential Standards. All utilitiesrequired to maintain the Landscape Improvements
including,without limitation,water and electrical,shall be paid for by Developer.
3.Standard of Maintenance.The standard for the quality of maintenance of the Landscape
Areas and Landscape Improvements shall be met whether or not a specific item of maintenance
is listed below.However, representative items of maintenance shall include: (i) proper
maintenance of all Landscape Areas and Landscape Improvements such that they are evenly cut,
evenly edged,reasonablyfree of bare and brown spots, debris, trash, litter, droppingsand
weeds; (ii) maintenance, repair and replacement on a regular schedule, of landscaping,
hardscaping, irrigation systemsandutilities; (iii) frequent and regular inspection for graffiti or
damage or deterioration or failure, and reasonablyprompt repair or replacement of all surfaces,
fencing, walls, lighted bollards, decorative pavement, equipment, etc., as necessary; (iv)
fertilizing, irrigating andreplacing vegetation, as necessary; (v) use and replacement of
vegetation of a type and amount as may reasonably be required to maintain the Landscape Areas
in accordance with the Conditions and the Tustin Legacy Specific Plan and consistent with High
Quality Residential Standards;(vi) adequate maintenance of all Landscape Areas and Landscape
Improvements such as not to be detrimental to public health, safety, or general welfare; and
(vii)regular and even trimming and pruning of all trees and shrubs so they do not impede
vehicular or pedestrian traffic, do not intrude into neighboring properties, do not create nuisances
to neighboring properties, including but not limited also to root pruning to eliminate exposed
surface roots and damage to curbs and gutters, sidewalks, driveways, utilities and other
structures or improvements.
4.Allocation of Maintenance Responsibilities.Except as set forth in Section 22 with
respect to assignment to a Homeowners’ Association, maintenance responsibilities shall be
vested in one entity for all of the Development Parcelsand the Boundary Landscape Areaand
the LandscapeImprovementsat any given time during the Term.
5.Term.The term of this Agreement shall be perpetual, unless termination is consented to
by the City, in its sole discretion.
3
Attachment 22 Landscape Maintenance Agreement City of Tustin/Standard Pacific
Tustin Standard Pacific Landscape Maintenance Agreement 1-31-2014January 31, 2014
6.Access.City hereby grants to Developer and its successors-in-interest authorization for
installation, maintaining, repair, and replacement of landscape and hardscape within the
Boundary Landscape Area to access and maintain the Boundary Landscape Area in accordance
with this Agreement.
7.Insurance.From and after the Effective Date, Developer, at its cost, shall maintain public
liability and property damage insurance with a single combined liability of not less than
$1,000,000 and property damage limits of not less than $500,000 insuring against all liability of
Developer and the Developer Representativesarising out of or in connection with thepresence,
activities or work on or use of the Landscape Improvements and/or Landscape Area or any act or
omission to act of Developer and/or the Developer Representativeswith respect to the Landscape
Areas and/or Landscape Improvements.In addition, Developer shall provide workers’
compensation insurance meeting statutory limits for all persons employed by Developerin
connection with obligations under this Agreement.The foregoing may be satisfied during the
term of the DDA by insurance required thereby but shall not subtract from any insurance
obligations of Developer to City under the DDA. Developer will furnishto Cityduly
authenticated Certificates of Insurance evidencing maintenance of the insurance required under
this Agreement and such other evidence of insurance or copies of policies as may be reasonably
required by Cityfrom time to time. Insurance must be placed with insurers with a current A.M.
Best Company Rating equivalent to at least a Rating of “A-/VII”(if an admitted carrier) or A-/X
(if offered by a surplus line broker).An Accord certificate evidencing the foregoing and
providing the following endorsements signed by the authorized representative of the underwriter
and approved by City shall be delivered within seven (7) Business Days following the Effective
Dateof this Agreementand annually evidencing renewals of each policy. The endorsements
shall provide as follows: (1) designate the City, its elected and appointed officials, agents,
representatives and employees as additional insureds on the commercial general liability
policies; (2) the commercialgeneral liability insurance coverage shall be primary, and not
contribute with any insurance or self-insurance maintained by City and (3) a waiver of
subrogation for the benefit of the City. Such insurance will be on an “occurrence,” not a “claims
made”and will be prepaid on an annual basis.The procuring of such insurance and the delivery
of policies, certificates or endorsements evidencing the same shall not be construed as a
limitation of Developer’s obligation to indemnify City as set forth herein.
8.Indemnity.Developer hereby agrees to protect, indemnify, defend and hold harmless the
City Indemnified Parties from and against any and all claims, actions, damages, costs (including,
without limitation, attorneys’fees), injuries, or liability, arising out ofor in connection with (a)
the presence, activities or work on or use of the Landscape Improvements and/or Landscape
Areaby Developer and/or Developer Representatives, (b) any act or omission to act of
Developer and/or the Developer Representatives with respect to the Landscape Areas and/or
Landscape Improvements, (c) entry onto theLandscape Areas by Developer or the Developer
Representatives in connection with this Agreement and (d)bodily injury to or death of any
person (including any employee orcontractor of the CityIndemnified Parties) or damage to or
loss of use of property resulting from such acts or omissions of Developer or any Developer’s
Representativewith respect to the Landscape Areas and/or Landscape Improvements; provided
that the foregoing indemnity shall not apply to the extent of thenegligence, willful misconduct or
fraud of any City Indemnified Party.The provisions of this Section shall survive the termination
of this Agreement.
4
Attachment 22 Landscape Maintenance Agreement City of Tustin/Standard Pacific
Tustin Standard Pacific Landscape Maintenance Agreement 1-31-2014January 31, 2014
9.Mechanic’s Liens.Developer shall keep the Landscape Areas free and clear of any
mechanics’ liens or materialmen’s liens.
10.Compliance with Laws.Developer shall comply with alllaws, regulations, conditions, or
instructions affecting the Landscape Areasand the Landscape Improvements, including without
limitation, those issued by the Environmental Protection Agency, or any federal, state, interstate,
or local governmental agency having jurisdiction to abate or prevent pollution. The disposal of
any toxic or hazardous materials withinthe Landscape Areasis specifically prohibited. Such
regulations, conditions, or instructions in effect or prescribed by said Environmental Protection
Agency, or any federal, state, interstate, or local governmental agency shall be complied with by
Developer. The Developershall not discharge waste or effluent from the Landscape Area in
such a manner that the discharge will contaminate streams or other bodies of water or otherwise
become a public nuisance. The foregoing shall not subtract from any environmental
responsibilities of Developer to City under the DDA.
11.City Remedies.In the event of a breach of any provision of this Agreement, City may
Default Notice
demand by written notice (“”) that the violation be cured. Except for utility
service interruptions or similar emergencies which shall not require advance notice or cure
periods hereunder, if Developer does not cure the violation within thirty (30) days after receipt of
the DefaultNotice, or if such default is of a kind which cannot reasonably be cured within thirty
(30) days, and Developer does not within such thirty (30) day period commence to cure such
default and diligently thereafter prosecute such cure to completion, then Cityshall have the right,
but not the obligation,to (i) institute legal action against Developer for specific performance,
injunction, declaratory relief, damages, or anyother remedy provided by law, (ii) pay any sum
owed by Developer to the party entitledto such paymentand/or(iii)enter upon the Development
Parcels and the Landscape Areas and to summarily abate, remove or otherwise remedy any
improvement, and/or repair or modify any improvement which violates the terms of this
Agreement and/orperform any obligation of Developer under this Agreement to be performed
thereon. Developer shall pay to the City, within thirty (30)calendardays of written demand by
City (which demand is accompanied by appropriate supporting documentation), an amountequal
to all costs and expenses incurred by City in undertaking any of the actions permitted by the
preceding sentence, including without limitation,third party costs and City hourly wagesand
benefits reasonably allocable to the time expended by City intaking such actions, together with
interest thereon at the rate equal to the Default Interest Rate, from the date such costs and
expenses were advanced or incurred bythe City. The rights and remedies given to City by this
Agreement shall be deemed to becumulative and no one of such rights and remedies shall be
exclusive of any of the others, or of any other right or remedy at law or in equity which City
might otherwise have by virtue of a default under this Agreement, and the exercise of one such
right or remedy by any City shall not impair the City’s standing to exercise any other right or
.
remedy
12.Estoppel Certificate. Each party hereby covenants that within ten (10) business days of
the written request of any other party it will issue to such other party an Estoppel Certificate
stating: (a) whether the party to whom the request has been directed knows of any defaultunder
this Agreement and if there are known defaults specifying the nature thereof; (b) whether to its
knowledge this Agreement has been assigned, modified, or amended in any way (and if it has,
5
Attachment 22 Landscape Maintenance Agreement City of Tustin/Standard Pacific
Tustin Standard Pacific Landscape Maintenance Agreement 1-31-2014January 31, 2014
then stating the nature thereof); and whether to the party’sknowledge this Agreement is as of
that date is in full force and effect.
13.Excuse for Non-Performance. Each party shall be excused from performing any
obligation or undertaking provided in this Agreement except any obligation to pay any sum of
money under the applicable provisions hereof, in the event and so long as the performance of any
such obligation is prevented or delayed, retarded, or hindered by act of God, fire, earthquake,
floods, explosion, actions of the elements, war, invasion, insurrection, riot, mob violence,
sabotage, inability to procure or general shortage of labor, equipment, facilities, materials, or
supplies in the ordinary course on the open market; failure of normal transportation strikes,
lockouts, action of labor unions, condemnation, requisition, laws, orders of governmental or civil
or military authorities.
14.Effect on Third Owners. Except as herein specifically provided, no rights, privileges or
immunities conferred upon the parties to this Agreementshall inure to the benefit of any
homeownernor shall any person be deemed to be a third partybeneficiary of any of the
provisions contained herein.
15.Entire Agreement. This Agreement constitutes the entire agreement between the parties
hereto pertaining to the subject matter hereof, andthe final, complete and exclusive expression of
the terms and conditions thereof. Prior agreements, representations, negotiations, and
understandings of the parties hereto, oral or written, express or implied, are hereby superseded
and merged herein.
16.Modification. This Agreement may not be modified in any respect or rescinded, in whole
or in part, except by an instrument in writing, duly executed and acknowledged by the parties
hereto, or their successors or assigns that arethe record owners of the Landscape Areas.Any
change, modification, amendment or rescission which is made without the written consent of
such owners shall be null and void and of no effect. No consent or approval of any owner other
than those owners described in the first sentence ofthis Sectionshall be required in order to
modify or amend any provisions of this Agreement.
17.Severability. If any term, covenant, condition or provision of this Agreement, or the
application thereof to any person or circumstance, shall to any extent be held by a court of
competent jurisdiction to be invalid, void or unenforceable, the remainder of the terms,
covenants, conditions or provisions of this Agreement, or the application thereof to any person or
circumstance, shall remain in full force and effect and shall in no way be affected, impaired or
invalidated thereby.
18.Governing Law. This Agreement and the obligations of the parties hereunder shall be
interpreted, construed, and enforced in accordance with the laws of the State of California.
19.Waiver andDefault.The waiver by one party of the performance of any provision of this
Agreement shall not invalidate this Agreement nor shall it be considered a waiver by it of any
other provision under this Agreement or of any subsequent breach by the other party of the same
provision.
20.References to Sections, Clauses and Exhibits. Unless otherwise indicated, references in
this Agreement to sections, clauses and exhibitsare to the same contained in or attached to this
6
Attachment 22 Landscape Maintenance Agreement City of Tustin/Standard Pacific
Tustin Standard Pacific Landscape Maintenance Agreement 1-31-2014January 31, 2014
Agreement and all exhibitsreferenced in this Agreement are incorporated in this Agreement by
this reference as though fully set forth in this Section.
21.Counterparts. This Agreement may be executed in one or more counterparts. All
counterparts so executed shall constitute one agreement, binding on all parties, even though all
parties are not signatory to the same counterpart.
22.Runs With the Land; Release and Termination; Assignment. This Agreement and the
terms, provisions, promises, covenants and conditions hereof shall run with the land and burden
the Developer Parcels and shall be binding upon Developer and its successors and assigns for the
benefit of the Boundary Landscape AreaandCity and its respective legal representatives,
successors and assigns.This Agreementand all the terms, covenants and conditions herein
contained shall be enforceable as equitable servitudes in favor of the Boundary Landscape Area
and any portion thereof. This Agreement shall automatically be released and terminate with
respect to any portion of the Development Parcels which is improved with a residential dwelling
unit and conveyed to a home buyer. In the event of a transfer by Developer of all of the
Development Parcels, the obligations and liabilities of the Developer under this Agreement shall
be binding upon the successor owner of the Development Parcels, and Developer shall be
released from all obligations and liabilities under this Agreement accruing from and after the
date of the conveyance, except that prior to issuance of the Certificate of Compliance pursuant to
the DDA, any such release shall be applicableonly to the extent provided in the DDA.
Developer and any successor owner of the Development Parcels shall only be liable for the
obligations and liabilities under this Agreement which accrue during the period that Developer or
such successor owner ownsthe Development Parcels,except that prior to issuance of the
Certificate of Compliance pursuant to the DDA, any such limitation on liability shall be
applicable only to the extent provided in the DDA.Developer may assign its duties, obligations
and liabilities under this Agreement to the Homeowners’Association either in full, or with
respect to certain phases or portions of the Landscape Areas. Such assignment shall be
accomplished through the recordation of an assignment and assumption instrument which shall
clearly set forth those portions of the Landscape Areas to which such assignment applies and
shall contain an assumption by the Homeowners’Association of the obligations and liabilities
under this Agreement with respect to such portions of the Landscape Areas arising from and
Assignment Agreement
after the date of the assignment (“”). Upon recordation of the
Assignment Agreement, Developer shall be released from any and all obligations or liabilities
arising or accruing under this Agreement from and after the effective date of the assignment with
respect to those portions of the Landscape Areas and Landscape Improvements and those
obligations and liabilities which are subject to the Assignment Agreement.
IN WITNESS WHEREOF, City and Developer have signed this Agreement as of the date
first set forth above.
[signature page follows]
7
Attachment 22 Landscape Maintenance Agreement City of Tustin/Standard Pacific
Tustin Standard Pacific Landscape Maintenance Agreement 1-31-2014January 31, 2014
CITY OF TUSTIN:
Dated:
By:
Jeffrey C. Parker,
City Manager
ATTEST:
By:
Erica Rabe
City Clerk Services Supervisor
APPROVED AS TO FORM
By:
David Kendig,
City Attorney
Armbruster Goldsmith & Delvac LLP
Special Real Estate Counsel to the City
By:
Amy E. Freilich
DEVELOPER:
Standard Pacific Corp., a Delaware corporation
By:
Name:______________________
Title: ______________________
8
Attachment 22 Landscape Maintenance Agreement City of Tustin/Standard Pacific
Tustin Standard Pacific Landscape Maintenance Agreement 1-31-2014January 31, 2014
State of)
) ss.
County of )
On ________________________, before me, ___________________________, personally
appeared _______________________________, personally known to me or proved to me on the
basis of satisfactory evidenced to be the person(s) whose name(s) is/are subscribed to the within
instrument and acknowledged to me that he/she/they executed the same in his/her/their
authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s) or
the entity upon behalf of which the person(s) acted, executed the instrument.
WITNESS my hand and official seal.
Notary Public
My Commission Expires:
9
Attachment 22 Landscape Maintenance Agreement City of Tustin/Standard Pacific
Tustin Standard Pacific Landscape Maintenance Agreement 1-31-2014January 31, 2014
State of)
) ss.
County of )
On ________________________, before me, ___________________________, personally
appeared _______________________________, personally known to me or proved to me on the
basis of satisfactory evidenced to be the person(s) whose name(s) is/are subscribed to the within
instrument and acknowledged to me that he/she/they executed the same in his/her/their
authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s) or
the entity upon behalf of which the person(s) acted, executed the instrument.
WITNESS my hand and official seal.
Notary Public
My Commission Expires:
10
Attachment 22 Landscape Maintenance Agreement City of Tustin/Standard Pacific
Tustin Standard Pacific Landscape Maintenance Agreement 1-31-2014January 31, 2014
EXHIBIT“A”
LEGAL DESCRIPTION OF DEVELOPMENT PARCELS
[To Be Attached]
EXHIBIT “B”
LEGAL DESCRIPTION OF CITY PROPERTY
[To Be Attached]
Will be comprised of City owned lots containing the property between the Boundary Line of the
Development Parcels and the back of curb on Jamboree Road, Park Avenue, Warner off-ramp
and Moffett Avenueand including the Entry Areas
EXHIBIT “C”
DEPICTION OF LANDSCAPE AREAS
[To Be Attached]
Attachment 23
SOIL LICENSE AGREEMENT
Agreement
This Soil License Agreement (“”) is made as of __________, 2014between
CityLicensee”
the City of Tustin (“”) and Standard Pacific Corp., a Delaware corporation (“),
Parties
(collectively, the “”) as set forth herein:
RECITALS
WHEREAS the City owns certain property located in Tustin, California, as depicted on
CityProperty
Exhibit “A”attached hereto (the “”);
WHEREAS concurrently with the execution of this Agreement, Licensee has acquired
from the City certain real property located in Tustin, California more particularly depicted on
Development Parcel
Exhibit“B”attached hereto (the “”) pursuant to that certain Tustin Legacy
Disposition and Development Agreement for Disposition Parcels 1B and 6A by and between the
DDA
City and the Licensee dated as of _________, 2014 (the “”)(initially capitalized terms used
and not defined herein shall have the meanings set forth in the DDA);
WHEREAS in connection with the acquisition of the Development Parcel, Licensee
wishes to (i) excavate and remove soil from the City Property in the amount required for grading
of the Project in accordance with the Approved Plans for the Grading Work (each as defined in
the DDA), but in no event more than 650,000 cubic feet, andtransport such soil onto the
Development Parcel to use as fill dirt in connection with the grading and development of the
Import Activities
Development Parcel(the “”); and (ii) export soil spoils resulting from the
Export
finished grading and development of the Development Parcel to the City Parcel(the “
Activities
”)(the Import Activities and the Export Activities are collectivelyreferred to asthe
Activities
“”);
WHEREAS the City desires Licensee to complete such Activities in an expeditious
manner subject to the terms and conditions set forth in this Agreement:
WHEREAS this Agreement is required to be executed and delivered by the Parties
pursuant to the DDA, and without which the Licensee would not acquire the Development Parcel
from the City.
TERMS AND CONDITIONS
NOW, THEREFORE, in consideration of the mutual promises and covenants of the
parties contained herein, the City and Licensee agree as follows:
1.Grant of Access for Activities. Subject to the terms of this Agreement, the City
hereby grants Licensee and each of its authorized representatives, consultantsand subcontractors
License
anon-exclusive license (“”) to enter the City Propertyfor the purpose of performing the
Activities, as defined above. Licensee may cause any soil within the City Property to be tested
for the presence of any Hazardous Materials or other unsuitable material, and for its geotechnical
suitability to be used as fill soil in connection with the grading and development of the
Soil Tests
Development Parcel(collectively, “”).As to soil which was not brought to the City
Property by Licensee, Licensee may reject and leave on the City Property any soil which it
deems to be unsuitable for its purposes in its sole and absolute discretion.In the conduct of the
1
Attachment 23 Soil License AgreementCity of Tustin/Standard Pacific
Tustin Standard Pacific Soil License Agreement 01-29-2014.docxJanuary 31, 2014
Export Activities, Licensee shall not export to the City Property any soils originating from a
location other than the City Property or the Development Parcel. During the term of this
Agreement, Licensee will exercise reasonable efforts to avoid any material interference with use
and enjoyment of the City Propertyby the City, and shall maintain the City’s ability to access the
City Propertyat all times, except for the types of interference and access limitations customarily
associated with the Activities. After expiration or termination of this Agreement, Licensee will
not interfere with the use and enjoyment of the City Propertyby the City or any occupant or
invitee on the City Property. Licensee acknowledges that the Citymakes no representations or
warranties as to the condition of the City Property,the soil located thereon, any hazards that may
be present on or below grade at the City Property, or otherwise; and that Licensee's use of the
City Propertyand the soil thereon is subject to the City Property’s as is, where is, condition.
Licensee further acknowledges that the Activities will be performed at Licensee’s risk. This
License shall constitute a license coupled with an interest, and is irrevocable except pursuant to
the termination provisions set forth herein. Nothing in this Agreement shall create or constitute
an easement or interest in the City Propertyand this Agreement shall be considered nothing other
than a license as set forth herein.
2.Noticeof Commencement. Licensee will provide the City at least two (2)
business days advance written notice of Licensee’s intent to enter the City Propertyto commence
the Activities.
3.WorkPlan.Prior to commencement of the Activities, Licensee shall submitfor
review and approval by the City, a work plan setting forththe location, schedule and extent of
WorkPlan
Licensee’s proposed Activities (the “”). The Work Plan shall include a description of
the condition of the City Propertyat the completion of each of the Import Activities and the
Export Activities and shall include typical conditions required by the City with respect to license
activities, such as applicable mitigation requirements related to noise, air quality, NPDES permit
compliance, access etc. The Work Plan shall separately identify the area for Import Activities
and the area for Export Activities. The Export Activities area within the License Area shall be
minimized to the greatest extent feasible. Upon execution of this Agreement, and documentation
confirming the insurance requirements provided for in Section 8 below, Licensee is permitted to
perform the Activities in the WorkPlan within the portions of the City Property designated for
such use in the Work Plan. Should Licensee propose additional Activities, Licensee shall
prepare a supplemental workplan specifying the proposed Activities and a schedule for them
Supplemental WorkPlan
(“”). The City shall review and if not approved, provide comments, if
any, to Licensee within ten (10)Business Days after receiving the Supplemental WorkPlan. If
City does not provide comments to Licensee within such period or any agreed upon extension of
such time, then Licensee is permitted to perform the Activities in the Supplemental WorkPlan.
All work, whether pursuant to the WorkPlan or a Supplemental WorkPlan, shall be performed
by Licensee at no cost to the City.
4.Data Sharing. Licensee agrees to provide the City with copies of all Soil Test
results.
3.Haul Routes. In conducting the Activities, Licensee shall utilize haul routes
between the City Property and the Development Parcel in locations approved by the City. Once
established, haul routes may be modified or relocated by the City, provided, that haul routes are
2
Attachment 23 Soil License AgreementCity of Tustin/Standard Pacific
Tustin Standard Pacific Soil License Agreement 01-29-2014.docxJanuary 31, 2014
at all times available to the Licensee, and such haul routes are reasonably accessible by
Licensee’s grading equipment, dump trucks and other equipment.
4.Repair of City Improvements. In the event that Licensee’s conduct of the
Activities damages or destroys any improvements located on the City Property or on public
streets or rights of way, Licensee shall repair such damage to as near a condition as existed prior
to the conduct of the Activities as is reasonably practicable at Licensee’s sole cost and expense.
5.Compliance with Plans and Laws. Licensee shall perform the Activities in
accordance with the Approved Plans for the Grading Workapproved by the City in accordance
with the provisions of the DDA and shall conduct the Activities in a manner consistent with such
Approved Plansand the Work Plan and Supplemental Work Plans, if any. Licensee shall
comply with all laws, regulations, ordinances and orders that apply in any manner to the
Activities and for any permits that may be required to perform the Activitiesand with all
mitigation measures set forth in applicable Mitigation Monitoring and Reporting Plans for Tustin
Legacy and the Project. Notwithstanding the foregoing, and except for the routine reporting of
data incident to a permit application, should Licensee discover conditions on the City Property
during the Activities that Licensee believes may require reporting to any Governmental
Authority (local, regional, state, or federal), Licensee shall, as promptly as reasonably practical,
advise the City of such discovery and thereafter provide City with the field and/or laboratory
data pertaining to such discovery. The City shall be responsible for making whatever report or
reports may be required in light of such discovery(ies).
6.Indemnity. Licensee will defend and indemnify City, its officers, agents and
employees (collectively, the “Indemnitees”), from and against all actions, claims, costs,
damages, fees, liabilities, losses and expenses, including reasonable attorneys’ fees and experts’
fees (collectively, “Claims”), resulting directly from the Activities and/or Licensee’s entry onto
the City Property, including without limitation, any Claims by Licensee, its officers, agents or
employees arising out of an alleged dangerous condition of the City Property. Notwithstanding
the foregoing, Licensee shall not be responsible and shall have no obligation to defend or
indemnify the Indemnitees to the extent a Claim relates to or arises from (a) the active
negligence, gross negligenceor willful misconduct of an Indemnitee and/or (b) the mere
discovery of existing conditions, contamination or hazardous materials at, on, under or
emanating from the City Property. If the City is served or otherwise presented with a Claim or
potential Claim for which it believes it is entitled to defense and/or indemnity under this
Paragraph,City will notify Licensee of such Claim or potential Claim within ten (10) Business
Days of receipt of such claim. Selection of counsel and defense of a Claim shall be conducted in
accordance with the provisions of Section10.8 of the DDA.The provisions of this Section shall
survive termination of this Agreement.
7.Licensee’s Insurance. Throughout the term of this Agreement, Licensee shall
maintain and require its subcontractors involved in the Activities to maintain the following
insurance coverage:
a.Comprehensive General Liability Insurance, in an amount of not less than
$5,000,000 per occurrence (Licensee)and $1 million per occurrence (subcontractors, if not
covered by Licensee’s wrap insurance coverage);
3
Attachment 23 Soil License AgreementCity of Tustin/Standard Pacific
Tustin Standard Pacific Soil License Agreement 01-29-2014.docxJanuary 31, 2014
b.Automobile Liability Insurance in an amount of not less than $2,000,000
per occurrence (Licensee) and $1 million per occurrence (subcontractors, if not covered by
Licensee’s wrap insurance coverage);
c.Workers’ Compensation Insurance adequate to meet the statutory
requirements of all jurisdictions having authority over such claims, including, but not limited to,
the State of California, and Employers Liability Insurance in an amount of not less than
’
$1,000,000 per occurrence (Licensee)and $500,000(subcontractors, if not covered by
Licensee’s wrap insurance coverage); and
d.Prior to coming on to the City Propertypursuant to this Agreement,
Licensee shall provide the City with a certificate or certificates of insurance evidencing the
foregoing coverages and with a blanket policy endorsement adding the City, its officers,
managers, employees, elected officials, and agents as additional insureds to the Comprehensive
General liability coverage. The certificate(s) of insurance shall be on an industry-standard
Accord form; the endorsements shall be on the carrier’s additional insured form and either: (a)
the endorsement shall provide that the insurance shall not be cancelled or terminated for any
reason except upon not less than ten (10) daysnotice to City, or (b) Licensee shall provide
evidence that the full premium for each policy has been paid in full (e.g., the effectiveness of the
policy is not subject to future monthly payments of premiums or financing). The Workers
Compensation Insurance coverage shall be endorsed to waive subrogation rights against the City
and its officers, managers, employees, elected officials, and agents.
8.No Liens. Licensee shall bear all costs relating to the Activities. Licensee and its
contractors shall not incur any liens against the City Propertyin connection with the Activities or
in any way attributable to the acts of Licensee or Licensee's agents or subcontractors on the City
Property. Licensee agrees to indemnify, defend, and hold City harmless from any such liens
and/or claims of liens for Activities performed, materials furnished, or any other activities under
control of Licensee or its agents or subcontractors which, pursuant to the laws of California, may
become a lien on the City Property. Should any lien be filed against the City Propertyin
connection with Licensee’s Activities, Licensee may bond around the lien as part of disputing
the lien with the party asserting the lien. The provisions of this Section shall survive termination
of this Agreement.
9.Notices. All notices required by this Agreement shall be provided in writing and
shall be deemed received when (a) personally served, (b) two (2) days after being sent by registered
or certified mail, return receipt requested, postage or charges prepaid, or by recognized overnight
carrier, or one (1) day after receipt by facsimile machine or electronic mail, with transmission and
receipt acknowledged in writing, and addressed to the party for whom intended at such party's
address herein specified, or at such other address as such party may have substituted therefore by
proper notice to the other.
4
Attachment 23 Soil License AgreementCity of Tustin/Standard Pacific
Tustin Standard Pacific Soil License Agreement 01-29-2014.docxJanuary 31, 2014
Notice to Licensee shall be sent to:
Michael Battaglia
Standard Pacific Corp.
15360 BarrancaParkway
Irvine, CA 92618
mbattaglia@stanpac.com
With a copy to:F. Kevin Brazil, Esq.
Rutan & Tucker, LLP
611 Anton Blvd., Suite 1400
Costa Mesa, CA 92626
kbrazil@rutan.com
Notice to City shall be sent to:
Jeffrey Parker, City Manager
City of Tustin
300 Centennial Way
Tustin, CA 92780
jparker@tustinca.org
With a copy to:David Kendig, City Attorney
555 Anton Boulevard, Suite 1200
Costa Mesa, CA 92626
dkendig@wss-law.com
10.Term.This Agreement shall commence upon the date that Licensee acquires the
Closing Date
Development Parcels(“”).The License to conduct the Import Activities on the
CityProperty shall terminate upon the earlier of (i) eighteen months from the Closing Date, (ii)
the completion of theGrading Work,or (iii) the earlier termination of the DDA. Upon
termination of the License to conduct the Import Activities, this Agreementand theLicense
granted hereby shall terminate with respect to the Import Activities and all portions of the City
Property other than areas identified for Export Activities in the City approved Work Plan or
Supplemental Work Plan, as applicable. The License to conduct Export Activitiesshall
terminate upon the earlier of (i) the issuance of the Certificate of Compliance by the City under
the DDA, or (ii) the earlier termination of the DDA. In addition, City shall have the right to
immediately terminate this Agreement by written notice to Licensee in the event of a material
breach of this Agreement by Licensee,which breach is continuing following receipt of written
notice by Licensee and the expiration of the applicable cure period under Section 14.2.1 or
14.2.2 of the DDA. Sections 6and 8shall survive termination of this Agreement.
11.California Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of California.
12.Counterparts. This Agreement may be executed incounterparts, all of which
together shall constitute a single instrument. Duly executed signatures to this Agreement may be
delivered by facsimile or electronic mail, and signature pages delivered by such method shall be
deemed equivalent to and of the same force and effect as original signature pages.
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Attachment 23 Soil License AgreementCity of Tustin/Standard Pacific
Tustin Standard Pacific Soil License Agreement 01-29-2014.docxJanuary 31, 2014
13.Authorization of Signatories. Each of the undersigned represent that he or she is
fully authorized to execute this Agreement on behalf of the entity named above his or her
signature.
14.Entire Agreement. This Agreement constitute the entire agreement of the parties
with respect to the subject matter hereof, and supersede any previous agreements, understandings
or promises, whether oral or written, regarding such subject matter. This Agreement may be
modifiedonly by a written instrument executed by the parties.
15.Assignment. This Agreement shall not be assigned except with the prior written
consent of the City.
IN WITNESS WHEREOF
, the Parties hereto have executed this Agreement as of date written
above.
CITY OF TUSTIN
By:_________________________
Name: ______________________
Its: City Manager
Date:_________________________
Approved as to Form:
David Kendig, City Attorney
STANDARD PACIFIC CORP.,
a Delaware corporation
By:
Name:
Its:
Date:
6
Attachment 23 Soil License AgreementCity of Tustin/Standard Pacific
Tustin Standard Pacific Soil License Agreement 01-29-2014.docxJanuary 31, 2014
EXHIBIT A
(Map of City Property)
7
Attachment 23 Soil License AgreementCity of Tustin/Standard Pacific
Tustin Standard Pacific Soil License Agreement 01-29-2014.docxJanuary 31, 2014
EXHIBIT "A"
EXHIBIT B
(Map of Development Parcel)
[to be inserted]
9
Attachment 23 Soil License AgreementCity of Tustin/Standard Pacific
Tustin Standard Pacific Soil License Agreement 01-29-2014.docxJanuary 31, 2014
Attachment 24
ATTACHMENT 24
TAX BURDEN SCHEDULE
LOWESTTAX A AND
BASETUSD CFD
SPECIAL TAX CLASSPRICE(COMBINED)TAX B
CLASS 1RESIDENTIAL PROPERTY (>= 3,530 SF)$1,004,900$5,008$1,507
CLASS 2RESIDENTIAL PROPERTY (3,210 -3,529 SF)$939,900$4,684$1,410
CLASS 3RESIDENTIAL PROPERTY (2,890 -3,209 SF)$871,900$4,345$1,308
CLASS 4RESIDENTIAL PROPERTY (2,570 -2,889 SF)$774,900$3,862$1,162
CLASS 5RESIDENTIAL PROPERTY (2,250 -2,569 SF)$669,900$3,339$1,005
CLASS 6RESIDENTIAL PROPERTY (< 2,250 SF)$574,900$2,865$862
1
Attachment 24 Tax Burden ScheduleCity of Tustin/Standard Pacific
Tustin Standard Pacific Tax Burden Schedule 1-28-2014.Docx January 28, 2014
Attachment 25
ATTACHMENT 25
REPURCHASE PRICELOT VALUES
The following are land values by product line:
Product TypeLot Value
Carriage Court$66,150 average per lot
46 x 82$141,850 average per lot
50 x 100$168,700 average per lot
70 x 75$218,300 average per lot
1
Attachment 25 Repurchase Price Lot ValuesCity of Tustin/Standard Pacific
Tustin Standard Pacific Repurchase Price Lot Values 1-28-2014.DocxJanuary 28, 2014
Attachment 26
ATTACHMENT 26
CFD LIQUIDATED DAMAGES CALCULATION
In the event that a CFD Default occurs with respect to either the Tax A CFD or the TUSD
CFD, but not both, the amount of the CFD Liquidated Damages payable pursuant to Section
16.7(a) shall be calculated as follows:
With respect to the first CFD Default:
In the event of a CFD Default with respect to either Tax A CFD o
both, the CFD Liquidated Damages amount shall be calculated by multiplying the total CFD
Liquidated Damages amount of $23,900,000 by a fraction in which
average per unit base year annual tax burden for the CFD subjectcalculated
as described below (the Default CFD Average Per Unit Base Year Annual Tax Burden )and the
denominator is the average per unit base year annual tax burden set forth in Table 1, Column D
1
below (the Total Average Per Unit Base Year Annual Tax Burden ).
The Default CFD Average Per Unit Base Year Annual Tax Burden applicable to the CFD
that is subject to the CFD Default is calculated as follows (andhown in the example
in Table 3 below):
1.Step 1. Insert in Column B the base year annual tax burden for each Class of
Residential Property which would have been imposed by the proposed CFD which
failed as a result of the CFD Default which shall be determined based upon the
lowest base price for each Class as set forth in Table 2 below, and shall be as shown
in the rate and method of apportionment set forth in the CFD for
2.Step 2. Calculate Column C (the Default CFD Base Year Annual Tax Burden Per Class)
by multiplying the number of units within each Class in Column A by the base year
annual tax burden for the default CFD in Column B.
3.Step 3. Calculate the sum of all numbers in Column C and divide by 375. The
resulting number shall be the Default CFD Average Per Unit Base Year Annual Tax
Burden applicable to the CFD which is the subject of the CFD Def
The CFD Liquidated Damages applicable to the first CFD Default s
multiplying the sum of Twenty-Three Million Nine Hundred Dollars ($23,900,000.00) by the
percentage derived from dividing the Default CFD Average Per Unit Base Year Annual Tax
Burden by the Total Average Per Unit Base Year Annual Tax Burden.
1
The calculation of the average per unit maximum base year annual tax burden for Tax A CFD and TUSD CFD is based upon the
information contained in Attachment 24 and the number of residen; if the number of units
in each Class were to vary the denominator would need to be recaated.
Attachment 26 CFD Liquidated Damages Calculation1City of Tustin/Standard Pacific
CFD Liquidated Damages Calculation (Attachment 26)(6).Docx January 31, 2014
The Calculation is represented by the following formula, where
Default CFD Average Per Unit Tax Burden.
X
CFD Liquidated Damages (Y) = $23,900,000 multiplied by D
TABLE 1
BASE YEAR AVG. PER
ANNUAL TAX TOTAL BASE UNIT BASE
BURDEN FOR YEAR ANNUAL YEAR
TAX A AND TAX ANNUAL TAX
UNIT TUSD CFD BURDEN PER
BURDEN*
COUNT(COMBINED)* CLASS*
(C ÷ A)
SPECIAL TAX CLASS (A x B)
D*
AB*C*
CLASS 1 RESIDENTIAL PROPERTY (>= 3,530 SF) 70 $5,008 $350,560
CLASS 2 RESIDENTIAL PROPERTY (3,210 - 3,529 SF) 99 $4,684 $463,716
CLASS 3 RESIDENTIAL PROPERTY (2,890 - 3,209 SF) 26 $4,345 $112,970
CLASS 4 RESIDENTIAL PROPERTY (2,570 - 2,889 SF) 55 $3,862 $212,410
CLASS 5 RESIDENTIAL PROPERTY (2,250 - 2,569 SF) 41 $3,339 $136,899
CLASS 6 RESIDENTIAL PROPERTY (< 2,250 SF) 84 $2,865 $240,660
$4,046 1
TOTAL 375 $1,517,215
*Annual Base Year Calculation
TABLE 2
SPECIAL TAX CLASS LOWEST BASE PRICE
CLASS 1 RESIDENTIAL PROPERTY (>= 3,530 SF)$1,004,900
CLASS 2 RESIDENTIAL PROPERTY (3,210 - 3,529 SF) $939,900
CLASS 3 RESIDENTIAL PROPERTY (2,890 - 3,209 SF) $871,900
CLASS 4 RESIDENTIAL PROPERTY (2,570 - 2,889 SF) $774,900
CLASS 5 RESIDENTIAL PROPERTY (2,250 - 2,569 SF) $669,900
CLASS 6 RESIDENTIAL PROPERTY (< 2,250 SF) $574,900
With respect to the second CFD Default:
The CFD Liquidated Damages payable for the second CFD Default =$minus Y
Example: The calculation in Table 3 below and following is an example of the
calculation of the CFD Liquidated Damages with assumed numbers a
hypothetical CFD Default.
Attachment 26 CFD Liquidated Damages Calculation2City of Tustin/Standard Pacific
CFD Liquidated Damages Calculation (Attachment 26)(6).Docx January 31, 2014
TABLE 3
DEFAULTCFD AVG. PER
DEFAULT CFD BASE YEAR UNIT BASE
BASE YEAR ANNUAL TAX YEAR
ANNUAL TAX BURDEN PER ANNUAL TAX
UNIT COUNT BURDEN CLASS*BURDEN*
(C ÷ A)
SPECIAL TAX CLASS PER CLASS* (A x B)
D*
A B*C*
CLASS 1 RESIDENTIAL PROPERTY (>= 3,530 SF) 70 $3,132 $219,240
CLASS 2 RESIDENTIAL PROPERTY (3,210 - 3,529 SF) 99 $2,929 $289,971
CLASS 3 RESIDENTIAL PROPERTY (2,890 - 3,209 SF) 26 $2,717 $70,642
CLASS 4 RESIDENTIAL PROPERTY (2,570 - 2,889 SF) 55 $2,415 $132,825
CLASS 5 RESIDENTIAL PROPERTY (2,250 - 2,569 SF) 41 $2,088 $85,608
CLASS 6 RESIDENTIAL PROPERTY (< 2,250 SF) 84 $1,792 $150,528
$2,530
TOTAL 375 $948,814
*Annual Base Year Calculation
1)In this example, X =2,530; D = 4,046
X 2,530
2)CFD Liquidated Damages (Y) = $23,900,000 x D = $23,900,000 x 4,046 = $14,944,883
3)CFD Liquidated Damages for second CFD Default =
$23,900,000 minus Y= $23,900,000 - $14,944,883 = $8,955,117
Attachment 26 CFD Liquidated Damages Calculation3City of Tustin/Standard Pacific
CFD Liquidated Damages Calculation (Attachment 26)(6).Docx January 31, 2014