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08 FIRST AMENDMENT TO THE DDA CORNERSTONE I WITH FLIGHT VENTURE LLC (FORMED BY AFFILIATES OF LINCOLN PROPERTIES AND ALCION STRATEGIC III, LLC)
Agenda Item 8 Reviewed: AGENDA REPORT City Manager `* Finance Director N/A MEETING DATE: JUNE 20, 2017 TO: JEFFREY C. PARKER, CITY MANAGER FROM: ECONOMIC DEVELOPMENT DEPARTMENT SUBJECT: FIRST AMENDMENT TO THE DISPOSITION AND DEVELOPMENT AGREEMENT CORNERSTONE I (DDA) WITH FLIGHT VENTURE LLC (FORMED BY THE AFFILIATES OF LINCOLN PROPERTY COMPANY COMMERCIAL, INC. AND ALCION CAPITAL STRATEGIC III, LLC) SUMMARY: First Amendment to the previously approved Disposition and Development Agreement Cornerstone I (DDA) with Flight Venture LLC (formed by the affiliates of Lincoln Property Company Commercial, Inc. and Alcion Capital Strategic III, LLC) for the Flight development at Tustin Legacy. On November 15, 2016, the City Council authorized the City Manager to execute the DDA. At that time, City staff identified that there were a few attachments to the DDA that were not complete and would be brought back to the City Council at a future date for approval. The proposed First Amendment, as further described below, includes these attachments along with text revisions to the DDA based on comments received from the project lenders for Phase 1. (The DDA as amended by the First Amendment to the DDA is referred to collectively as the "Amended DDA.") RECOMMENDATIONS: Approve and authorize the City Manager or his designee to execute the First Amendment to the DDA between Flight Venture LLC and City. 2. Authorize the City Manager or his designee to approve such modifications to the Amended DDA as are both (a) consistent with the objectives of the Amended DDA and (b) recommended by the City's special real estate counsel or the City Attorney, including, but not limited to minor modifications of boundaries set forth in the Attachments to the Amended DDA. 3. Authorize the City Manager or his/her designee to take such other actions, including but not limited to approving and executing related agreements and documents, as are both (a) required by the Amended DDA or necessary to implement the purpose of the Amended DDA, and (b) recommended by the City's special real estate counsel or the City Attorney. Agenda Report: First Amendment to DDA with Flight Venture LLC June 20, 2017 Page 2 of 4 FISCAL IMPACT: This recommended First Amendment to the DDA has no financial or fiscal impacts upon the existing DDA. The negotiated price for Phase 1 and Phase 2 are unchanged from the original DDA. CORRELATION TO THE STRATEGIC PLAN: This action correlates to the City's Strategic Plan for Economic and Neighborhood Development (Goal A). BACKGROUND: On November 1, 2016, the City Council approved various entitlements to allow for the development of the Flight project, consisting of up to 870,000 square feet of creative office use with a food hall and conference center on approximately 38 acres at Tustin Legacy. At the subsequent City Council meeting held on November 15, 2016, the Council gave authorization to the City Manager to execute the DDA with Flight Venture LLC for the project. The project will be developed in two phases with the first phase adjacent to the newly constructed Tustin Legacy Park. The Developer has agreed on loan terms with its lenders (i.e., iStar Inc. and Delphi CRE Funding LLC), they have paid non-refundable loan deposits, and the loan documents are nearing completion. The Developer intends to close the loan and acquire the property shortly after the City Council's approval of this First Amendment. The Developer has submitted all required grading and construction plans for the development of Phase 1 to the City for review. City approvals have been obtained on all but one permit, which is nearing approval. DISCUSSION: At the time of DDA execution there were some Attachments to the DDA which remained incomplete due to ongoing project design and follow-up discussions with the construction lenders and developer regarding securing the loans, clarifying potential transferees, and clarifying the representations made by each party in response to the ongoing status of the project. The synopsis below identifies these updated Attachments to the DDA and describes them briefly. The proposed changes within the body of the DDA are in response to the lenders' requests to clarify the rights of the City, Developer and lender in the event of default by the Developer under the DDA or as a borrower under the loan. The forms have been updated, where appropriate, to reflect these changes. Agenda Report — Flight DDA Amendment No. 1 June 20, 2017 Page 3 of 4 Attachment 6 - Form of City Estoppel The Estoppel form would be submitted to the City by any future buyer of the project which requests that the City make a representation as to the status of the Amended DDA, project and Developer compliance with the Amended DDA. The changes to this are minor and reflect the removal of the lender as a recipient, since the City will use a separate form of statement with the lender. Attachment 12 — Form of Memorandum of DDA This memorandum, which will be recorded on the property, provides information in the public record including identifying the Amended DDA, highlighting significant sections that refer to the City rights under the Amended DDA and that provide that the Amended DDA is the primary encumbrance on the property. The City, through the Amended DDA, has the right to enforce development of the property pursuant to the terms and conditions in the Amended DDA and the Amended DDA preserves the City's right, not obligation, to repurchase or revest the property in the event of certain defaults by the Developer or a subsequent Transferee and in certain circumstances following foreclosure. Attachment 21— Form of Roadway, Landscape and Utility Easement Agreement This form of the agreement will be recorded which identifies shared facilities between Phase 1 and Phase 2 of the project. This document establishes easements, access rights and maintenance responsibilities for areas that generally serve as common areas and improvements for both phases such as the private roadways, utilities, adjacent landscaping, sidewalks, and drainage. This is necessary since there will be separate ownership of the parcels in each respective phase with the City retaining ownership of the Phase 2 Parcel until a future transfer date, as well as the possibility of a transfer to a separate ownership entity than the Phase 1 ownership entity. Attachment 22 — Form of Pad Transferee Non-Disturbance and Attornment Agreement This form is intended for future transferees that are purchasing or ground leasing a pad, developed or undeveloped. It states that a Pad Transferee is obligated to comply with certain requirements of the Amended DDA, the Quitclaim Deed, the Special Restrictions, the Easement Agreement, the Landscape Agreement, the CC&Rs, and the Master Declaration, which apply to the Building Pad including certain obligations such as constructing vertical improvements and horizontal improvements required to be constructed on the Building Pad within the time period set forth in the Schedule of Performance. It also states the City's Right of Repurchase and the City's Right of Reversion if the Pad Transferee is not acting in conformance with the Amended DDA. Attachment 24 — Form of Subordination Agreement Flight Ventures LLC is the developer and equity investor in the property and the construction lenders are iStar Inc. and Delphi CRE Funding LLC. Through this form, the City will enter into the Subordination Agreement recognizing the lenders as Permitted Mortgagees. This Agreement also recognizes the lender's right to record a Deed of Trust and other security documents (e.g., Loan Documents including, but not limited to, the Note, loan agreement, and guarantees) that encumber any portion of the borrower's Agenda Report — Flight DDA Amendment No. 1 June 20, 2017 Page 4 of 4 interest in the mortgaged property to the benefit of the lender(s). The developer and lender will enter into an Assignment Agreement in favor of the construction lender which could be exercised in the event of foreclosure. The City will assume no financial liability under this Subordination Agreement. Attachment 27 — Form of Landscape Installation and Maintenance Agreement An agreement which requires the property owner(s) or applicable association to install and maintain the perimeter landscaping adjacent to their property which abuts the City streets. This includes maintenance of the City owned right-of-way landscaping. During the interim period where the City is still the owner of the Phase 2 Parcel this will require landscape maintenance of the Phase 2 Parcel private property by the Developer. .Buchanan r of Economic Development Attachment: First Amendment to the DDA Ryan Swiontek Project Manager Economic Development Department FIRST AMENDMENT TO TUSTIN LEGACY DISPOSITION AND DEVELOPMENT AGREEMENT CORNERSTONE I This FIRST AMENDMENT TO TUSTIN LEGACY DISPOSITION AND DEVELOPMENT First Amendment AGREEMENT CORNERSTONE I(this “”) is entered into as of June 20, 2017 (the First Amendment Effective Date “”) by and between the CITY OF TUSTIN, a municipal corporation of City the State of California (as more fully defined in the Original DDA (defined below), the “”) and FLIGHT VENTURE LLC, a Delaware limited liability company (as more fully defined in the Original DDA, Developer “”). The City and Developer and their respective permitted successors and assigns are sometimes PartyParties referred to in this First Amendment individually asa “” and collectively as the “”. RECITALS A.The City and Developer entered into that certain Tustin Legacy Disposition and Original DDA Development Agreement Cornerstone I dated as of November 15, 2016 (the “”) pursuant to which, among other things, the City agreed to sell, and the Developer agreed to purchase, the Phase 1 Property (as defined in the Original DDA.) The Original DDA as amended by this First Amendment is Agreement referred to herein as the “”. Initially capitalized terms not defined herein shall have the respective meanings assigned to such terms in the Original DDA. B.The Parties desire to amend the Original DDA to modify the rights and obligations of the Parties and to correct certain other provisions of the Original DDA as further set forth below. In addition, the Parties desire to update certain Attachments to the DDA that were not in final form as of the Effective Date of the Original DDA or otherwise require amendment. AGREEMENT NOW THEREFORE, in consideration of the foregoing Recitals, which are hereby incorporated into the operative provisions of this First Amendment by this reference, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties further agree as follows: New Section 1.2.4 1.: The following text is added to the Original DDA as Section 1.2.4: “1.2.4(a)Notwithstanding anything to the contrary set forth in this Agreement, the Subordination Agreement entered into by City and a Permitted Mortgagee with respect to the Phase 1 Property, or in any of the Other Agreements (including any reference to the “Developer” as being both the owner of the Phase 1 Property and the owner of the Phase 2 Property or the “Property” as being both the Phase 1 Property and the Phase 2 Property), from and after the occurrence of both Applicable Date of the following (the “”): (i) the Phase 1 Property Close of Escrow and (ii) the earliest to occur of (A)the Phase 2 Property Close of Escrow pursuant to exercise of the Option (unless the Phase 1 Developer is the same Person as the Phase 2 Developer), (B) the termination of the Option for any reason; (C) the Phase Transfer of Phase 1 or Phase 2 by means other than pursuant to Section 2.2.2(a) or (f)) in accordance with the terms of the DDA, including provision by Transferee of an Assignment Agreement and Guaranty meeting the requirements of the DDA and the concurrent relinquishment by the Phase 1 Developer of all of its right, title and interest in and to the Option other than, if then applicable, its interest as the Working Developer, or (D) the termination of this Agreement with respect to Phase 2, and subject to the limitations set forth in clauses (aa) through (dd)below, no act or omission of any Person (including the Developer, Tustin Cornerstone I First AmendmentCity of Tustin/ 1 Cornerstone I to DDA 06-12-2017 FINAL.docx Successor Owner or Permitted Mortgagee of the Phase 2 Property) to the extent relating to the Phase 2 Property or to the extent relating to the Phase 2 Project, or any portion thereof, nor any matter, event or circumstance to the extent relating to the Phase 2Property or to the extent relating to the Phase 2 Project or any portion thereof shall: (1) constitute a Default that gives rise to or constitutes a City Lien as to the Phase 1 Property, or otherwise adversely affect any rights or benefits afforded to the Developer, Successor Owner or any Permitted Mortgagee with respect to the Phase 1 Property or the Phase 1 Project pursuant to this Agreement, any Subordination Agreement entered into by City and such Permitted Mortgagee with respect to the Phase 1 Property, or any of the Other Agreements (including the right to obtain a Certificate of Compliance with respect to all or a portion of Phase 1 as set forth in Article 9); (2)constitute a condition or requirement affectingthe Phase 1 Property or the Phase 1 Project (including a condition to the issuance of a Certificate of Compliance for any of Phase 1); (3)subject the owner of the Phase 1 Property, or any portion thereof, or any Permitted Mortgagee of the Phase 1 Property, or any portion thereof, to any obligations, liability or responsibility (including any indemnity obligations) relating to the Phase 2 Property or the Phase 2 Project arising from and after the Applicable Date; (4) impair or adversely affect any rights or benefits granted to the Phase 1 Property, or any portion thereof, or any Permitted Mortgagee of the Phase 1 Property, or any portion thereof, under this Agreement, the Other Agreements, or any Subordination Agreement entered into by City and such Permitted Mortgagee with respect to the Phase 1 Property; or (5) require any Permitted Mortgagee of any of the Phase 1 Property to take any action (including the cure of any Default), or assume any obligations upon Foreclosure, with respect to the Phase 2 Property or the Phase 2 Project arising from and after the Applicable Date, in each case other than: (aa) the obligation to Complete the Minimum Horizontal Improvements and any obligations binding on the Phase 1 Developer or the owner of the Phase 1 Property with respect to the Phase 2 Property expressly set forth in the License Agreements, (bb) any obligations binding on the Phase 1 Developer or the owner of the Phase 1 Property with respect to the Phase 2 Property expressly set forth in the Quitclaim Deed for Phase 1, the Special Restrictions, the Master Declaration, the CC&Rs, the Roadway and Utility Easement Agreement and/orthe Landscape Installation and Maintenance Agreement, in each case in accordance with the terms and conditions of such agreements, (cc) the provisions of Section 4.3.3 and Section 15.3relating to the forfeiture of all Cash Option Payments to the City, the obligations of the Working Developer to deliver a bill of sale to the City for the Reimbursable Phase 2 Improvements, and the potential forfeiture of payment of the Option Credit Remainder to the Working Developer in accordance with Section 4.3.3(h), and (dd) obligations under this Agreement arising prior to the Applicable Date (including Ongoing Matters arising prior to the Applicable Date),provided that with respect to a Foreclosure Transferee that is a Permitted Mortgagee or Permitted Mortgagee Affiliate, such Person shall only be liable for the foregoing obligations in clauses (aa) through (dd)to the extent provided in Section 2.2.2(h)(ii)belowand in any Subordination Agreement entered into by the City and such Permitted Mortgagee. (b)Notwithstanding anything to the contrary set forth in this Agreement, the Subordination Agreement entered into by City and a Permitted Mortgagee with respect to the Phase 2 Property, or in any of the Other Agreements (including any reference to the “Developer” as being both the owner of the Phase 1 Property and the owner of the Phase 2 Property or the “Property” as being both the Phase 1 Property and the Phase 2 Property), from and after the Applicable Date, and subject to the limitations set forth in clauses (aa) through(dd)below, no act or omission of any Person (including the Developer, Successor Owner or Permitted Mortgagee of the Phase 1 Property) to the extent relating to the Phase 1 Property or to the extent relating to the Phase 1 Project, or any portion thereof, nor any matter, event or circumstance to the extent relating to the Phase 1 Property or to the extent relating to the Phase 1 Project or any portion thereof shall: (1)constitute a Default that gives rise to or constitutes a City Lien as to the Phase 2 Property, or otherwise adversely affect any rights or benefits afforded to the Developer, Successor Owner or Tustin Cornerstone I First AmendmentCity of Tustin/ 2 Cornerstone I to DDA 06-12-2017 FINAL.docx any Permitted Mortgagee with respect to the Phase 2 Property or the Phase 2 Project pursuant to this Agreement, any Subordination Agreement entered into by City and such Permitted Mortgagee with respect to the Phase 2 Property, or any of the Other Agreements (including the right to obtain a Certificate of Compliance with respect to all or a portion of Phase 2 as set forth in Article 9), (2)constitute a condition or requirement affecting the Phase 2 Property or the Phase 2 Project (including a condition to the issuance of a Certificate of Compliance for any of Phase 2), (3)subject the owner of the Phase 2 Property or any portion thereof, or any Permitted Mortgagee of the Phase 2 Property or any portion thereof, to any obligations, liability or responsibility (including any indemnity obligations) relating to the Phase 1 Property or the Phase 1 Project arising from and after the ApplicableDate, (4) impair or adversely affect any rights or benefits granted to the Phase 2 Property, or any portion thereof, or any Permitted Mortgagee of the Phase 2 Property, or any portion thereof, under this Agreement, the Other Agreements, or any Subordination Agreement entered into by City and such Permitted Mortgagee with respect to the Phase 2 Property, or (5) require any Permitted Mortgagee of any of the Phase 2 Property to take any action (including the cure of any Default), or assume any obligations upon Foreclosure, with respect to the Phase 1 Property or the Phase 1 Project arising from and after the Applicable Date, in each case other than: (aa) the obligations to Complete the Minimum Horizontal Improvements, but only to the extent not Completed by the Phase 1 Developer and imposed as obligations on the Phase 2 Developer hereunder and any obligations binding on the Phase 2 Developer or the owner of the Phase 2 Property with respect to the Phase 1 Property expressly set forth in any License Agreements, applicable thereto, (bb) any obligations binding on the Phase 2 Developer or the owner of the Phase 2 Property with respect to the Phase 1 Property expressly set forth in the Quitclaim Deed for Phase 2, the Special Restrictions, the Master Declaration, the CC&Rs, the Roadway and Utility Easement Agreement and/or the Landscape Installation and Maintenance Agreement, in each case in accordance with the terms and conditions of such agreement, (cc) during the term of the Option, the ability to exercise, and the termination of, the Option if the Phase 1 Developer and the Optionee are Related Parties to the extent provided in Sections 4.3.3, 4.3.4 and 15, and(dd) the Ongoing Mattersrelating to the Phase 2 Property; provided that with respect to a Foreclosure Transferee that is a Permitted Mortgagee or Permitted Mortgagee Affiliate, such Person shall only be liable for the foregoing obligations in clauses (aa) through(dd)to the extent provided in Section 2.2.2(h)(ii) belowand in any Subordination Agreement entered into by the City and such Permitted Mortgagee.” Modification to Section 2 of the Original DDA 2.. The first paragraph of Section 2of the Original DDA is hereby deleted in its entirety and replaced with the following: “Except as set forth in Section 14.2.3, any purported Transfer that does not comply with the requirements of Article 2shall, at the election of the City, be null and void and shall be a Material Default under this Agreement as of the date of the Transfer by both the Transferor and the Transferee, in accordance with the provisions of Section 14.2.3.” Modification to Section 2.2.2(h) of the Original DDA 3..Section 2.2.2(h)of the Original DDA is hereby deleted in its entirety and replaced with the following: “(h)The Transfer to a Foreclosure Transferee of all or any portion of the Phase 1 Parcel or the Phase 2 Parcel (which foreclosed Parcel or portion thereof, together with all of Developer’s right, title, and interest in and to this Agreement and all other documents and agreements related hereto Foreclosed Collateral to the extent of such Parcel is hereby referred to as the “”); providedthat, unless assigned in accordance with this Agreement, the Option shall be part of the Phase 1 Foreclosed Collateral; provided furtherthat: Tustin Cornerstone I First AmendmentCity of Tustin/ 3 Cornerstone I to DDA 06-12-2017 FINAL.docx (i)to the extent the Foreclosure Transferee is not the Permitted Mortgagee whose Mortgage is foreclosed or its Permitted Mortgagee Affiliate (which Permitted Mortgagee and its Permitted Mortgagee Affiliate are not subject to the requirements in thisclause(i)), then the Foreclosure Transferee shall be deemed a Qualified Foreclosure Purchaser if and only if it satisfies each of the following requirements for the benefit of the City (but for the avoidance of doubt, the failure to satisfy the following requirements shallnot invalidate any Foreclosure but shall be a Default under this Agreement by the Foreclosure Transferee) (and upon satisfaction of such conditions, no consent of the City shall be required to acknowledge that such Person is a Qualified Foreclosure Purchaser); (A)The Foreclosure Transferee shall, within twenty (20) Business Days after the date of the Foreclosure, submit to the City: (1)the information required by Sections2.2.3(a)(ii)(A),(C),(E),(F), and the following additional items: (x) a declaration certified by the chief financial officer or other appropriate authorized officer of each of the Foreclosure Transferee and of any entity constituting a “joint venture” between Persons that are proposing to satisfy different aspects of the requirements necessary for the Foreclosure Transferee to be deemed a Qualified Foreclosure Purchaser (e.g., one Person satisfying the experience test, which shall have the Operating Rights and Responsibilities) New Equity Investor and a second Person (the “”) satisfying the financial tests) who are authorized to execute documents on behalf of the Foreclosure Transferee and joint venture entity, as applicable, that the following documentation submitted by each such entity to the City is true and correct and attaching copies of (aa) a certificate of formation, California foreign entity registration (if registration is required by applicable law) and a fully executed limited liability company or limited partnership agreement or bylaws (including any amendments thereto) orother formation documents as applicable, (bb) copies of all resolutions or other necessary actions taken by such entity to authorize the execution of documents or instruments required by this Agreement, including without limitation the required AssignmentAgreement; (cc) certificates of good standing and tax good standing issued by the Secretary of State and the applicable taxing authority in the state in which such entity is formed or incorporated and by the California Secretary of State (if registration is required by applicable law) and qualification to do business in California (if applicable), each dated within thirty (30) calendar days of the later of the date of the Foreclosure or the date of submittal to the City; (dd) evidence of the authority of the individual(s) executing the joint venture agreement to bind New Equity Investor and execute the joint venture or other agreement; and (ee)a copy of any Fictitious Business Name Statement, as published and filed with the Clerk of Orange County; (y) a certificate from the New Equity Investor in substantially the form of the “Original Equity Investor Certificate” (modified as appropriate to refer to such certifying party(ies), as applicable); and (z) the designation of the Person(s) that will have the Operating Rights and Responsibilities from and after the Foreclosure; (2)a plan to pay for all or a portion of the remaining work necessary to complete the Phase acquired, containing substantially the same level of detail of the “Financing Plan” described in Section 4.6.1, including any debt financing contemplated for such purposes (the Updated Financing Plan “”); (3)a replacement Guaranty made by a Person with assets meeting at a minimum the Net Worth required under Section 4.7.4hereof, to secure the development, construction and maintenance obligations of the Foreclosure Transferee as Developer under this Agreement, which shall be in the form and substance of the instrument attached to this Agreement asAttachment14or otherwise in a form acceptable to the City in its sole discretion and meeting the requirements of Section4.6.3; Tustin Cornerstone I First AmendmentCity of Tustin/ 4 Cornerstone I to DDA 06-12-2017 FINAL.docx (4)a written certification for the benefit of the City, executed by the chief financial officer or other appropriate authorized officer of the Foreclosure Transferee that Foreclosure Transferee meets each of the criteria required for, and therefore is, a Qualified Foreclosure Purchaser upon which the City shall be entitled to rely, but in the event the certification is not true and correct, the City will not be bound by the certification and the Foreclosure Transferee will not be treated as a Qualified Foreclosure Purchaser; (5)evidence of binding contractual commitment by the New Equity Investor to invest equity and fund the then-remaining coststo complete the applicable portions of the Projecton the Phase acquired, including the applicable Development Costs, as described in Section4.6.2(d) for the Phase acquired; and (6) evidence of insurance as required by Section 4.6.5for the Phase acquired. (B)The Foreclosure 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 Attachment16Aor Attachment 16Bas applicable, 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 applicable to the Foreclosed Collateral, to the extent described in Section 2.2.2(h)(ii)below. (ii)Such Transfer shall not release the Foreclosure Transferee from the obligations of this Agreement or the Other Agreements and unless otherwise specifically stated in Article 17or any Subordination Agreement then in effect between City and the applicable Permitted Mortgagee, and the Foreclosure Transferee and all other Transferees acquiring from and after a Foreclosure pursuant to this Section 2.2.2(h)shall for such Transferee’s period of ownership of theForeclosed Collateral and for the Additional Liability Period applicable to such Transferee, hold such Foreclosed Collateral subject to, assume and be obligated to comply with all requirements of this Agreement and the Other Agreements, but limited only to (A) the unperformed obligations of the preceding Developer(s) and/or Permitted Mortgagee or Permitted Mortgagee Affiliate with respect to the construction of the Minimum Horizontal Improvements and any obligations binding on the Developer as set forth inthe License Agreements with respect thereto or the payment to City of amounts payable to City (but excluding any obligation to reimburse the City for any attorneys’ fees incurred by the City and required to be reimbursed by the preceding Developer(s) and/or Permitted Mortgagee or Permitted Mortgagee Affiliate) that have not been discharged prior to the date of acquisition of the Foreclosed Collateral by Transferee, (B) the provisions of Section 4.3.3and Section 15.3relating to the forfeiture of all Cash Option Payments to the City(provided that in no event shall Permitted Mortgagee or Permitted Mortgagee Affiliate be required to pay any money to the City on account of such obligation, it being agreed that the intent of the foregoing is merely to recognize that funds previously paid by Developer may be,or may havebeen,forfeited), the obligations of the Optionee and Working Developer to deliver a bill of sale to the City for the Reimbursable Phase 2 Improvementsin accordance with this Agreement, and thepotential forfeiture of payment of the Option Credit Remainder to the Working Developer in accordance with Section 4.3.3(h)(provided that in no event shall Permitted Mortgagee or Permitted Mortgagee Affiliate be required to pay any money to the City on account of such obligation, it being agreed that the intent of the foregoing is merely to recognize that funds previously paid by Developer may be,or may havebeen,forfeited), (C) if applicable, the obligations of Permitted Mortgagee, if any, pursuant to Section 4(c)of any Subordination Agreement entered into by the City and such Permitted Mortgagee (assuming that the section numbering is the same as the Subordination Tustin Cornerstone I First AmendmentCity of Tustin/ 5 Cornerstone I to DDA 06-12-2017 FINAL.docx Agreement attached hereto as Attachment 24),and (D)the obligations of Developer arising from and after the date of Foreclosure Transferee’s acquisition of the Foreclosed Collateral, including without limitation, restrictions on Transfers and Transfers of Control otherwise contained in this Agreement. (iii)In the event of a Non-Permitted Foreclosure Event, the City shall be entitled to treat the Transfer as a Default under this Agreement, and shall have all remedies available to it under this Agreement, including the right to exercise the Right of Repurchaseor, if then applicable, the Right of Reversion; provided, however, that the provisions of Section 14.2.3(b) shall apply.” New Section 2.2.2(i) 4.. The following text is added to the Original DDA as Section 2.2.2(i): “(i)If the applicable Permitted Mortgagee or its Permitted Mortgagee Affiliate is the Foreclosure Transferee under Section 2.2.2(h), the subsequent Transfer of all or any portion of the Foreclosed Collateral by such applicable Permitted Mortgagee or its Permitted Mortgagee Affiliate to a Qualified Foreclosure Purchaser; providedthat prior and as a condition to such Transfer: (i) the Permitted Mortgagee or its Permitted Mortgagee Affiliate owning the Foreclosed Collateral and the proposed Transferee shall meet and confer with the City with respect to the financial and other qualifications of the Transferee; (ii) the Transferee shall meet each of the requirements set forth in Section 2.2.2(h)(i)(except that such conditions shall be satisfied no later than the date of such Transfer and the term Foreclosure Transferee as used therein shall be deemed to refer to the Transferee pursuant to this Section 2.2.2(i)), and such Transferee shall cause an original certificate to be executed by the chief financial officer or other appropriate authorized officer of the Transferee stating that the conditions set forth in this Section 2.2.2(i)have been satisfied; and (iii) the Transferor of the Foreclosed Property shall cause an original certificate to be executed by the chief financial officer or other appropriate authorized officer of the Transferor stating that, to the knowledge of such Transferor, such Transferee meets each of the criteria required for a Qualified Foreclosure Purchaser set forth in clauses (ii)and (v)of the definition thereof.” Modificationto Section 2.2.6 of the Original DDA [[300,1817,373,1870][11][,I,][Times New Roman]]5. [[1418,1817,1468,1870][11][,,][Times New Roman]]. [[1440,1817,1708,1870][11][,,][Times New Roman]]Section 2.2.6 [[1692,1817,2299,1870][11][,,][Times New Roman]]of the Original DDA is hereby deleted in its entirety and replaced with the following: City Estoppel and City Statement “2.2.6. From time to time (but in no event more often than annually or in connection with a Permitted Transfer or other 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 the Transferee,a City Estoppel, substantially in the form and substance of the City Estoppel attached hereto as Attachment6with such modification as may be reasonably requested by any Transferee,together with such modifications as are necessary in the City’s sole discretion to ensure the accuracy of the statements made therein. (a)Developer shall promptly pay to the City all of the City’s 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), as applicable, of each Transfer or Transfer of Control, not to exceed Three Thousand Dollars ($3,000.00) per estoppel; provided, however, such cap shall not be applicable if Developer proposes any material changes to the City Estoppel, or Developer is in Default under this Agreement or any of the Other Agreements at such time. The City costs incurred pursuant to this Section 2.2.6shall be DDA Transaction Expenses. Tustin Cornerstone I First AmendmentCity of Tustin/ 6 Cornerstone I to DDA 06-12-2017 FINAL.docx (b)In connection with any City Statement (as defined in any then-effective Subordination Agreement) requested by a Permitted Mortgagee under a then-effective Subordination Agreement or otherwise required to be issued by City pursuant to the terms of such Subordination Agreement, City shall, prior to issuance of such City Statement, deduct the amount ofThree Thousand Dollars ($3,000.00) as a DDA Transaction Expense from the City Costs Deposit. If there is then no City Costs Deposit requirement under this Agreement or there is a City Costs Deposit requirement under this Agreement and the amount then held by the City for the City Costs Deposit is not sufficient to pay such Three Thousand Dollars ($3,000.00), then the City shall, no later than five (5) Business Days after receipt of a written request from a Permitted Mortgagee for a City Statement, request payment of Three Thousand Dollars ($3,000.00) from Developer, which payment must be received by City prior to City’s issuance of the City Statement.Upon issuance of such City Statement, the City shall be entitled to retain such Three Thousand Dollar ($3,000.00) amount in full. In addition, should the City incur staff costs and third party legal fees (including fees of the City Attorney) in preparation of such City Statement that exceed the amount of the $3,000 payment, the City shall, if there are then sufficient funds in the City Costs Deposit, treat such expenses as DDA Transaction Expenses and deduct them from the City Costs Deposit. If the amount then held by the City as part of the City Costs Deposit is not sufficient to pay the excess costs described above, or if there is then no City Costs Deposit requirement under this Agreement, the City shall bill Developer directly for same and Developer shall, within thirty (30) days following its receipt of the City’s invoice therefor, pay to the City the full amount of the City’s expenses, including legal fees and staff costs, incurred with respect to the preparation, review, and delivery of each City Statement after subtracting therefrom the payment made prior to issuance of the City Statement. Amounts unpaid following the time period set forth above, shall be deemed, without further action of the City, Borrower or Lender, to be a City Lien. In addition, the City shall have no obligation to issue any City Statement unless and until it has been paid in full for amounts outstanding due from prior preparation of City Statements that remain unpaid at the time the request for City Statement is made. (c)The payment obligations of Developer under this Section 2.2.6shall be secured by the Guaranty and the Guaranty provided by any Guarantor for a Phase or portion of the Project for which a City Statement may be required by a Permitted Mortgagee shall be amended toincorporate such requirement prior to execution thereof by Guarantor.” Modification to Section 2.2.7 of the Original DDA 6..Section2.2.7of the Original DDA is hereby deleted in its entirety and replaced with the following: Exclusion of LPCC “2.2.7. (a)The City has selected LPCC as the developer of the Project based upon the experience of LPCC and the business terms it has proposed for this transaction. Therefore, notwithstanding that LPCC has entered into agreements pursuant to which the Controlling Person of Developer is not LPCC or an Affiliate of LPCC, and such Controlling Person has a right to Transfer this Agreement and the Property to a Developer Affiliate or to Transfer Control to a Developer Affiliate or to otherwise make certain Transfers or Transfers of Control under this Agreement, in no event shall Developer make a Permitted Transfer or any other Transfer to any Person that would result in the removal of LPCC (or an Affiliate of LPCC) as the Person which has the Operating Rights and Responsibilities, without the prior written consent of the City, which consent shall be exercised in the sole discretion of the City provided, however, that in the event that the Controlling Person requests the removal of LPCC or an Affiliate of LPCC as a result of a default by the Affiliate of LPCC that is a party to the Original Joint Venture Agreement or, if then in effect, any other Joint Venture Agreement approved by the City in its sole discretion pursuant to Tustin Cornerstone I First AmendmentCity of Tustin/ 7 Cornerstone I to DDA 06-12-2017 FINAL.docx which LPCC (or an Affiliate of LPCC) had Operating Rights and Responsibilities, the City and Developer shall meet and confer in good faith regarding the mutual selection of a replacement for LPCC (or an Affiliate of LPCC) with respect to the Operating Rights and Responsibilities, from the following four (4)developers and/or their Affiliates in connection therewith (each, a Designated Developer “”): (i) Hines, (ii)Trammell Crow, (iii) Bixby, and (iv) LBA, provided that any of the foregoing shall be ineligible for selection if such Person, together with its Affiliates, within the preceding eighteen (18) months prior to the date of the replacement, has been the subject of any of the events or actions described in Section 2.2.5(excluding any insolvency that is not accompanied by another event or action described in Section 2.2.5) affecting more than ten percent (10%) of the aggregate assets, or assets under management, as applicable, of such Person and its Affiliates. (b)The requirement for City consent set forth in Section 2.2.7(a)shall not apply to the Permitted Transfers described in Sections 2.2.2(h)or 2.2.2(i)or to the appointment of a Qualified Receiver by any Permitted Mortgagee or its Permitted Mortgagee Affiliate. (c)Following any Foreclosure at which the Permitted Mortgagee or Permitted MortgageeAffiliate takes title to the Foreclosed Collateral, as a condition precedent to commencing construction of the Project, the Permitted Mortgagee or Permitted Mortgagee Affiliate shall be required to, without limiting the provisions of Sections 2.2.2(h)andthe provisions of any Subordination Agreement undertake the Operating Rights and Responsibilities, which it shall be deemed qualified to do if an authorized officer of such Permitted Mortgagee or Permitted Mortgagee Affiliate shall certify in writing to the City that such Permitted Mortgagee or Permitted Mortgagee Affiliate, with its then current principals and key employees, meets the requirements of a Qualified Receiver or in the alternative has retained an entity to perform the Operating Rights and Responsibilities that meets the requirements of a Qualified Receiver, and in each case specifying the projects, principals and key employees at such entity (together with resumes) demonstrating the satisfaction of the qualifications in the definition of Qualified Receiver of such principals and/or key employees. If a Permitted Mortgage or its Permitted Mortgagee Affiliate is to have the Operating Rights and Responsibilities, prior to commencement of construction, such Person or its Affiliate must certify in writing to the City that it meets the qualifications required of a Qualified Receiver or in the alternative has retained an entity to perform the Operating Rights and Responsibilities that meets the requirements of a Qualified Receiver.” Modification to Section 4.7.2 of the Original DDA 7.. The second sentence of Section4.7.2of the Original DDA is hereby deleted in its entirety and replaced with the following: “Each Subordination Agreement for a Permitted Mortgage shall provide that the Permitted Mortgagee shall be obligated to, in the event that the Permitted Mortgagee has delivered written notice to the Developer or any Guarantor that (a) Developer or any guarantor with respect to the Permitted Mortgage or this Agreement fails to satisfy a Liquidity Covenant set forth in the Mortgage and /or any guarantee or (b) Developer or any guarantor is the subject of any of the events Guarantor Illiquidity Event or actions described in Section 2.2.5(each, a “”), provide a copy of such notice to the City within five (5) Business Days after the delivery of such notice to Developer or any such guarantor.” Modification to Section 4.7.4 of the Original DDA 8..Section4.7.4of the Original DDA is hereby deleted in its entirety and replaced with the following: “To the extent that (a) any Permitted Mortgage or if not in the Permitted Mortgage, any guaranty of any Mortgage proposed to be entered into does not contain the Liquidity Covenants or is to be Tustin Cornerstone I First AmendmentCity of Tustin/ 8 Cornerstone I to DDA 06-12-2017 FINAL.docx entered into by guarantors other than Guarantor or (b) the Liquidity Covenants in such Permitted Mortgage or guaranty of Permitted Mortgage are amended by the parties thereto in a manner that (x) eliminates the Liquidity Covenants, (y) reduces such covenants below the minimum liquidity standards set forth in the finalloan documents originally approved by City pursuant to Section17.2 (or the first sentence of Section 17.3), or (z) modifies the guarantor under the loan documents, such that the Guarantor of a Phase is not the same Person as the guarantor under the Permitted Mortgage for such Phase, whether initially or due to a change in the loan documents then, if such Mortgage is proposed at Close of Escrow, as a condition to Close of Escrow for the benefit of the City, and if such Mortgage is proposed to be entered into subsequent to Close of Escrow for a Phase or Building Pad for which a Certificate of Compliance has not been Recorded, as a condition to City’s approval of such Mortgage as a Permitted Mortgage: (i)Developer shall cause Guarantor to agree, in writing, to the following alternative Net Worth and Liquidity standards for the benefit of the City—Guarantor shall meet, at the time the Permitted Mortgage is made, and maintain until issuance of the Certificate of Compliance for the Phase it guarantees, a Net Worth of not less than One Hundred Million Dollars ($100,000,000.00) and Liquidity of not less than Twenty Five Minimum Liquidity Standards Million Dollars ($25,000,000.00) (“”), and (ii) Developer, Guarantor and City shall enter into a written agreement upon terms approved by each in its sole discretion, establishing the procedures by which (A) Guarantor shall furnish specified financial reports to the City on a regular basis to assure that the Minimum Liquidity Standards are met and that none of the events or actions described in Section 2.2.5with respect to the Guarantor have City Guarantor Illiquidity Event occurred (the failure of any such standard being, a “”); (B) in the event of a City Guarantor Illiquidity Event, within sixty (60) calendar days following the notice from City of a City Guarantor Illiquidity Event, Guarantor shall supplement its Net Worth and Liquidity to meet the Minimum Liquidity Standards or Developer shall be required to provide the City with additional security satisfactory to the City by (1) providing the City with a Guaranty in the form and substance of the Guaranty, or otherwise acceptable to the City in its sole discretion, from a replacement or supplemental guarantor or guarantors acceptable to the City in its sole discretion, or (2)furnishing the City with another form of security such as a pledge of specified assets or completion bond, in each case in a manner meeting the requirements of the City in its sole discretion. The City shall have the right, but not the obligation, toprovide written notice to Developer (with a copy to any Permitted Mortgagee whose address is on file in the Official Records as described in Section 18.6) of the occurrence of a City Guarantor Illiquidity Event and the provision of such notice shall constitute a declaration by the City of a Potential Default by Developer. The failure of Developer to provide substitute security for the Guaranty within the required time frame shall constitute a Material Default under this Agreement.” Modification to Section7.2.1(a)(v)of the Original DDA 9..Section 7.2.1(a)(v)of the Original DDA is hereby deleted in its entirety and replaced with the following: “(v)(1) the Landscape Installation and Maintenance Agreement and the (2) the Master Declaration Establishing Maintenance and Cost Sharing Obligations for Tustin Legacy Cornerstone I, each acknowledged and in recordable form;” Modification to Section 7.2.2 of the Original DDA 10.. a.Section7.2.2(b)(v)of the Original DDA is hereby deleted in its entirety and replaced with the following: “(v)(1) the Landscape Installation and Maintenance Agreement and the (2) the Master Declaration Establishing Maintenance and Cost Sharing Obligations for Tustin Legacy Cornerstone I, each acknowledged and in recordable form;” Tustin Cornerstone I First AmendmentCity of Tustin/ 9 Cornerstone I to DDA 06-12-2017 FINAL.docx b.Section 7.2.2(c)of the Original DDA is hereby deleted in its entirety and replaced with the following: “Subdivision Map and Construction Bond. A final tract map for the Phase 1 Property shall be Recorded, an easement agreement establishing the public access easement across Phase 2 for Airship Avenue and Flight Way in the locations described on the Phase 2 Property tentative tract map shall be Recorded and if not previously delivered in connection with such Recording or required pursuant to then effective subdivision improvement agreement or the Reimbursement Agreement, a Construction Bond with respect to the Phase 1 Horizontal Improvements insuring the Completion of such Phase 1 Horizontal Improvements.” Modification to Section 7.3.2(c) of the Original DDA 11..Section 7.3.2(c)of the Original DDA is hereby deleted in its entirety and replaced with the following: “Subdivision Map and Construction Bond. The final tract map covering the Phase 2 Parcel shall have been Recorded and if not previously delivered in connection with such Recording or the Phase 1 Property Close of Escrow, or required pursuant to then effective subdivision improvement agreement or the Reimbursement Agreement, a Construction Bond with respect to the Minimum Horizontal Improvements (to the extent not yet Complete) and the Phase 2 Horizontal Improvements insuring the Completion of such Phase 2 Horizontal Improvements shall have been delivered.” Modification to Section 8.1.3 of the Original DDA 12.. The following text is added to the end of Section 8.1.3of the Original DDA: “City acknowledges and agrees that with respect to any “Development Costs,” described in this Agreement and any Guaranty delivered under this Agreement, the reference to “financing fees and costs, including principal payments and interest payments” shall refer to loans taken out by the applicable Developer that is an affiliate of the party or parties that executed such Guaranty (and not by the City or any successor owner of the Mortgaged Property).” Modification to Section 8.2.4of the Original DDA 13..Section 8.2.4of the Original DDA is hereby deleted in its entirety and replaced with the following: Limited Licenses [[450,2073,500,2130][12][,I,][Times New Roman]]“ [[838,2073,2300,2130][12][,,][Times New Roman]]. At the Phase 1 Property Close of Escrow (and provided that the Phase 2 Property Close of Escrow does not occur substantially concurrently), the City shall provide to Developer the following limited and revocable licenses to enter upon the portions of the Development Parcels continued to be owned by the City: (a) a limited license for performance by Developer of construction, including grading, construction of the Minimum Horizontal Improvements and installation of utilities on the Phase 2 Parcel, installation of landscaping improvements, hardscaping improvementsand associated utilities on the Perimeter Landscape Area (as such term is defined in the Landscape Installation and Maintenance Agreement) and installation of those portions of the Reimbursable Tustin Legacy Improvements which are to be installed by Developer as part of the Minimum Horizontal Improvements on land owned by the City, in each case pursuant to a license agreement in substantially the form and substance of the agreement attached as Attachment25A, or as otherwise mutually approved by the City and Developer each in its sole discretion, (b)a limited license for the performance by Developer of property due diligence, pursuant to a license agreement in substantially the form and substance of the agreement attached as Attachment25B, and (c) a limited Phase 1 construction staging and Tustin Cornerstone I First AmendmentCity of Tustin/ 10 Cornerstone I to DDA 06-12-2017 FINAL.docx construction parkinglicense on the Phase 2 Parcel pursuant to a license agreement in substantially the form and substance of the agreement attached as Attachment 25C, or as otherwise mutually approved by the City and Developer each in its sole discretion License Agreements (collectively, the “”). Improvements in public right of way shall require that Developer apply for encroachment permits which shall be issued by the City in its Governmental Capacity.” Modification to Section 8.13(b) of the Original DDA 14..Section 8.13(b)of the Original DDA is hereby deleted in its entirety and replaced with the following: “(b)The Restrictions shall apply only during each of the Phase 1 Non-Compete Period and the Phase 2 Non-Compete Period and not during any period prior to, between or following such periods or during any period in which Developer is in Material Default under this Agreement and the Restrictions shall not apply with respect to any use for which a building permit application is filed during the time period in which the Restrictions are not applicable, even if the Phase 1 Non- Compete Period or Phase 2 Non-Compete Period subsequently becomes effective prior to issuance of such building permit or construction of the building; providedthat if there is a Permitted Mortgage with respect to a Phase, then (i) as to Phase 1, the Phase 1 Non-Compete Period shall remain in effect notwithstanding a Material Default by the Phase 1 Developer for such period of time in which the Permitted Mortgagee with respect to Phase 1 is diligently pursuing a cure of such Material Default, but not to exceed eight (8) months from the date of the Default Notice for such Material Default (and if there are multiple concurrent Material Defaults, the same shall refer to the first applicable Default Notice therefor), unless Permitted Mortgagee is pursuing a Foreclosure, in which event the extension of the Non-Compete shall not exceed twelve (12) months from the date of the Default Notice for such Material Default (and if there are multiple concurrent MaterialDefaults, the same shall refer to the first applicable Default Notice therefor) (except as provided in clause (iii)below); provided that in all events, the outside date of the Phase 1 Non-Compete Period shall be the date set forth in Section8.13(d); (ii)as to Phase 2, the Phase 2 Non-Compete Period shall remain in effect notwithstanding a Material Default by the Phase 2 Developer for such period of time in which the Permitted Mortgagee with respect to Phase 2 is diligently pursuing a cure of such Material Default, but not to exceed eight (8) months from the date of the Default Notice for such Material Default (and if there are multiple concurrent Material Defaults, the same shall refer to the first applicable Default Notice therefor), unless Permitted Mortgagee is pursuing a Foreclosure, in which event the extension of the Non-Compete shall not exceed twelve (12) months from the date of the Default Notice for such Material Default (and if there are multiple concurrent Material Defaults, the same shall refer to the first applicable Default Notice therefor) (except as provided in clause (iii)below); provided that in all events, the outside date of the Phase 2 Non-Compete Period shall be the date set forth in Section8.13(d); and (iii)Notwithstanding the foregoing, (A) in the event of a Bankruptcy Proceeding with the Phase 1Developer as debtor filed prior to the end of the Phase 1 Non-Compete Period, the Restrictions with respect to Phase 1 shall remain in effect until November 19, 2021, and (B) in the event of a Bankruptcy Proceeding with the Phase 2 Developer as debtor filed prior to the end of the Phase 2 Non-Compete Period, the Restrictions with respect to Phase Tustin Cornerstone I First AmendmentCity of Tustin/ 11 Cornerstone I to DDA 06-12-2017 FINAL.docx 2 shall remain in effect until the date that is four (4) years and two (2) months after the Phase 2 Property Close of Escrow.” Modification to Section 8.13(d) of the Original DDA 15..Section 8.13(d)of the Original DDA is hereby deleted in its entirety and replaced with the following: Mixed Use Building “(d) As used herein, “” shall mean a separate building in which 100% of the leasable ground floor space is occupied by a use other than Office Uses (provided, however, that a Phase 1 medical office use that is a Prohibited Use under this Agreement is also permitted). “ Project Stabilization ” shall mean that Leases or Transfer Agreements have been executed with Phase 1 Non-Compete Period End Users for not less than 315,000 GBA within Phase 1, and the “” shall be the period of time commencing on October 1, 2016 and ending on the date that is the earlier to occur of (i) Phase 1 Project Stabilization or (ii) October 1, 2020; provided that if at the expiration of the Phase 1 Non-Compete Period the Phase 1 Developer is then or has been in Bankruptcy, the Phase 1 Non-Compete Period shall be extended to the applicable date described in Section Phase 2 Project Stabilization 8.13(b)(iii)(A). As used herein, the term “” shall mean that Leases or Pad Transfer purchase and sale agreements have been executed with End Users for not less than Phase 2 Non-Compete Period 360,000 GBA within Phase 2, andthe “” shall be the period of time commencing on the exercise of the Option and ending on the date that is the earlier to occur of (i)Phase 2 Project Stabilization and (ii) three (3) years from the Phase 2 Property Close of Escrow, provided that if at the expiration of the Phase 2 Non-Compete Period the Phase 2 Developer is then or has been in Bankruptcy, the Phase 2 Non-Compete Period shall be extended to the applicable date described in Section 8.13(b)(iii)(B).” Revisions to Section 9.7 of the Original DDA. 16. Modification to Section 9.7(c) of the Original DDA a..Section 9.7(c)of the Original DDA is hereby deleted in its entirety and replaced with the following: “(c)notwithstanding anything to the contrary contained in this Agreement, (i)the releases set forth in Section 4.5.2(f)shall remain in effect and shall bind the releasingparty and its successors and assigns to the extent set forth in the Quitclaim Deed for such Property, (ii) the indemnities set forth in Sections 5.5,8.8.5,8.9,8.11,8.12,10.1, and 18.11shall remain in effect and shall be binding only upon the owner ofany portion of the Property owned by it that is the subject of the Certificate of Compliance and only with respect to matters occurring during the period of its ownership of such portion of the Property, and (iii) the indemnities set forth in Section 10.2shall remain in effect and shall bind the indemnifying party and its successors and assigns (provided that no Permitted Mortgagee or Permitted Mortgagee Affiliate shall be obligated to indemnify the City for any matters first caused, created or occurring after such Permitted Mortgagee or Permitted Mortgagee Affiliate has Transferred the applicable portion of the Property); and” New Section 9.7(e) b.. The following text is added to the Original DDA as Section 9.7(e) (with the “and” at the end of clause (c)therein deleted and the “.” at the end of clause (d)therein replace with “; and”): “(e)the Restrictions and covenants of Section 8.13shall survive until the expiration of the time period for such Restrictions and covenants as set forth therein, notwithstanding anything to the contrary contained in this Agreement (including Section 18.14).” Modification to Section 14.2.3 of the Original DDA 17..Section 14.2.3of the Original DDA is hereby deleted in its entirety and replaced with the following: Tustin Cornerstone I First AmendmentCity of Tustin/ 12 Cornerstone I to DDA 06-12-2017 FINAL.docx Transfer Defaults “. Notwithstanding the foregoing, any Transfer in violation of the provisions of Article 2shall be null and void and shall in all events be a Material Default under this Agreement as of the date of the Transfer by both the Transferor and the Transferee, without notice or cure period and shall not be subject to extension for Force Majeure Delay, except that with respect to: (a) involuntary Construction Liens, the notice and cure periods set forth in Section 14.2.2shall apply, in order to enable Developerto comply with the provisions of Section 8.8.5; and (b)notwithstanding anything to the contrary contained in this Agreement, any Transfer as a result of a Foreclosure, or so long as the Permitted Mortgagee or its Permitted Mortgagee Affiliate has made a good faith effort to comply with its obligations under Section 2.2.2(i), any Transfer by Permitted Mortgagee or its Permitted Mortgagee Affiliate following a Foreclosure, (i) shall notbe null and void, (ii) shall only be a Material Default as to the transferee (but not the transferor) in the event the same is a Non-Permitted Foreclosure Event, and (iii) except as set forth in clauses(A) and (B)in the following sentence, the City shall not be entitled to exercise any right or remedy against the Permitted Mortgagee or its Permitted Mortgagee Affiliate with respect to such Transfer. The City shall retain (A) all counterclaims of that nature it may have against any Permitted Mortgagee or Permitted Mortgagee Affiliate with respect to such Transfer in the event of any litigation commenced against the City by such Permitted Mortgagee or Permitted Mortgagee Affiliate, or arising as a result of claims or counterclaims against the City brought by Permitted Mortgagee or a Permitted Mortgagee Affiliate in litigation commenced by any other Person in connection with the applicable Foreclosed Property, and (B)all claims against the Permitted Mortgagee or its Permitted Mortgagee Affiliate to the extent arising from a claim that the certificate provided by Permitted Mortgagee or its Permitted Mortgagee Affiliate pursuant to Section 2.2.2(i) is knowingly false or knowingly misleading in any material respect).” Modification to Section 16.3.1 of the Original DDA. 18.Section 16.3.1of the Original DDA is hereby deleted in its entirety and replaced with the following: Exercise of Right of Repurchase “. The City may exercise its Right of Repurchase by delivering written notice to Developer and any Permitted Mortgagee whose address is on file in the Official Records (as described in Section 18.6) or following a Foreclosure, by providing notice to the Foreclosure Transferee, that the City elects to exercise its Right of Repurchase, stating that the City is exercising its Right of Repurchase and specifying the Reacquired Property; provided that such notice is delivered at least ninety (90) calendar days prior to the date on which the City requires Developer to convey the Property to the City pursuant to the Right of Repurchase and otherwise in accordance with this Section 16.3.” Modification to Section 16.3.2 of the Original DDA 19.. The second sentence of Section 16.3.2of the Original DDA is hereby deleted in its entirety and replaced with the following: “Theescrow shall close, and title to the Reacquired Property shall be conveyed to the City, and the Repurchase Price shall be paid, if there is then a Permitted Mortgage, in accordance with Section16.3.5, or if there is not then a Permitted Mortgage, to the then-owner of the Reacquired Property acquired by the Cityno later than five (5) Business Days after the City has deposited into escrow the Repurchase Price.” Modification to Section 16.3.5 of the Original DDA. 20.Section 16.3.5of the Original DDA is hereby deleted in its entirety and replaced with the following: Rights of Third Parties “. The Right of Repurchase shall be a lien and encumbrance on the Property that shall be paramount to the lien and charge of (a) any Mortgage upon the Parcels or Improvements, and (b) all other liens, including Construction Liens that may attach to the Tustin Cornerstone I First AmendmentCity of Tustin/ 13 Cornerstone I to DDA 06-12-2017 FINAL.docx Development Parcels or the Improvements thereon. With respect to a lien that is a Construction Loan secured by a Permitted Mortgage, (i) the implementation of the Right of Repurchase shall be subject to the terms of the Subordination Agreement between the City and the applicable Permitted Mortgagee, (ii) the Repurchase Price paid by the City hereunder, which shall be calculated in accordance with this Agreement, shall be paid into the escrow established pursuant to Section16.3.2, (iii)such Permitted Mortgagee shall deliver a payment demand into such escrow for the Permitted Mortgage Unpaid Balance due to such Permitted Mortgageeplus any other amounts owed to the Permitted Mortgagee under the applicable loan documents up to the amount of the Repurchase Price, and (iv) the Repurchase Price, up to the amount due to the Permitted Mortgagee in such payment demand, shall be paid from such escrow directly to the applicable Permitted Mortgagee (or, if there shall be more than one Permitted Mortgagee, to the Permitted Mortgagee that the City has been notified in accordance with Section 18.6by the holder of the first priority Permitted Mortgage encumbering the applicable Property that it is the holder of the first priority Permitted Mortgage encumbering the applicable Property) before payment of the Repurchase Price is paid to Developer or any other Person, and Developer authorizes payment of the applicable portion of the Repurchase Price to the Permitted Mortgagee pursuant to such payment demand(absent manifest error on such payment demand). Developer agrees to execute, acknowledge and deliver appropriate documents, including, but not limited to escrow instructions, approvals of valid payment demands and approvals of draft closing statements as required to effectuate the foregoing. The Right of Repurchase shall not defeat or render invalid or limit any rights or interests provided in easements, covenants, conditions or restrictions in favor of third parties (i.e., Persons other than Developer or Developer Affiliates) granted pursuant to Transfers approved by the City (or constituting Permitted Transfers) and Recorded on the portion of the Property for which the City exercises its rights under this Section 16.3. The Reacquired Property acquired by the City shall be delivered to the City at close of escrow free and clear of all Mortgages including Permitted Mortgages and all other liens, including Construction Liens (other than City Liens and Lien Release Amounts that are actually deducted from the Repurchase Price paid by the City), and subject only to (w) the Permitted Exceptions in effect at the time of the original Close of Escrow for such Property, (x) utility easements and/or roadway easements, (y) other matters affecting title consented to or requested by any Governmental Authority with respect to the Property in connection with development of the Property, or requested by the City and any covenants recorded in order to comply with the Entitlements, and (z) the DA and Other Agreements recorded in accordance with the terms of this Agreement.Developer acknowledges and agrees that, notwithstanding any other provision of this Agreement, to the extent there is then one or more Permitted Mortgagesin effect with respect to the Reacquired Property:(a) the City is obligated to pay the RepurchasePrice into escrow in accordance with Section 16.3.2for the sole benefit of the Permitted Mortgagee(s) holding such Permitted Mortgage(s), (b) Developer hereby authorizes the City to instruct escrow holder to pay the entirety of the Repurchase Price to such Permitted Mortgagee(s) unless directed in writing otherwise by Developer and all then-existing Permitted Mortgagees,and (c) the allocation of Repurchase Price proceeds, if any, by such Permitted Mortgagee(s) to Developer shall be solely subject to the terms of any loan documents then in effect between the Permitted Mortgagee(s) and Developer, and City shall have no responsibility to any Person, including Developer, if Developer shall fail to receive proceeds of the Repurchase Price for which it might otherwise be entitled under this Agreement, the loan documents or otherwise. The Developer, on behalf of itself and every Person claiming by, through or under Developer, hereby waives any and all rights to recover from, and fully and irrevocably releases, the City and its elected and appointed officials, employees, agents, attorneys, affiliates, representatives, successors and assigns from any and all Claims with respect to (x) the direction provided in Section16.3.2, this Section 16.3.5or any SubordinationAgreementbetween Permitted Mortgagee(s) and the City or otherwise, requiring that City direct payment of the Repurchase Price in its entirety to one or more Permitted Mortgagees,and (y) the delivery of instructions by the City Tustin Cornerstone I First AmendmentCity of Tustin/ 14 Cornerstone I to DDA 06-12-2017 FINAL.docx to escrow and/or the payment, through escrow or otherwise, by the City of the entirety of the Repurchase Price to such Permitted Mortgagee(s), notwithstanding that Developer may have or may assert a claim to all or any portion of such proceeds pursuant to the loan documents or otherwise.” Modification to Section 16.4.1 of the Original DDA 21.. The introductory paragraph of Section16.4.1(prior to clause (a)thereof) of the Original DDA is hereby deleted in its entirety and replaced with the following: Certain Defaults Triggering the Right of Reversion “16.4.1. Except with respect to a Non- Permitted Foreclosure Event (as described in Section 16.4.1(k)), for which the Right of Reversion shall remain in effect with respect to each Phase from the Close of Escrow with respect to such Phase until the issuance by the City of a Certificate of Compliance for such Phase, the Right of Reversion shall remain in effect with respect to each Phase from the Close of Escrow with respect to such Phase until the Equity Completion Date applicable to such Phase. Further, prior to the Phase 2 Property Close of Escrow, if the Optionee and Phase 1 Developer are Related Parties, then upon the exercise by the City of the Right of Reversion with respect to Phase 1 or any portion thereof the Option and the Phase 2 Provisions shall be suspended and upon the occurrence of the Reversion Event, the Option and the Phase 2 Provisions shall be deemed to have terminated and to be of no further force or effect (provided that for so long as the Phase 1 Provisions remain in effect and the City shall remain the owner of the Phase 2 Property, the termination of the Phase 2 Provisions shall not affect the obligations of the City under this Agreement, if any, to the Phase 1 Developer with respect to the Phase 2 Property), and the provisions of Section 15.3shall apply. In all other cases, exercise by the City of the Right of Reversion with respect to a Phase shall not apply with respect to or affect the rights of the Developer of the other Phase unless the City specifically exercised the Right of Reversion with respect to such other Phase or portion thereof following a Reversion Action Trigger with respect to such other Phase. The City may exercise the Right of Reversion if it elects to do so with respect to only the Parcel affected by the Material Default and any Improvements thereon and all applicable Entitlements and other development rights, consents, authorizations, variances, waivers, licenses, permits, certificates and approvals from any Governmental Authority or quasi-Governmental Authority, and all other appurtenant rights applicable thereto upon the Reversion Action Trigger occurrence of any of the following (each, a ”,” and the date on which Reversion Action Trigger the Reversion Action Trigger occurs shall be referred to herein, as the “ Date ”).” Modification to Section 16.4.1(j) of the Original DDA 22..Section16.4.1(j)of the Original DDA is hereby deleted in its entirety and replaced with the following: “(j)Material Default arises because of as to any Phase, (i) a voluntary or involuntary Transfer prior to the Equity Completion Date for such Phase, or (ii) after the Equity Completion Date for such Phase, a Non-Permitted Foreclosure Event with respect to such Phase.” New Section 16.4.1(k) of the Original DDA 23.. The following text is added to the Original DDA as Section 16.4.1(k): “(k)a Material Default arises because of the occurrence of a Non-Permitted Foreclosure Event with respect to a Phase at any time prior to the issuance of a Certificate of Compliance for such Phase.” Modification to Section 16.4.2 of the Original DDA 24.. The first sentence of Section 16.4.2of the Original DDA is hereby deleted in its entirety and replaced with the following: Tustin Cornerstone I First AmendmentCity of Tustin/ 15 Cornerstone I to DDA 06-12-2017 FINAL.docx “The City shall be entitled to exercise the Right of Reversion at any time on or after the applicable Reversion Action Trigger Date by providing written notice to Developer and any Permitted Mortgagee whose address is on file in the Official Records (as described in Section 18.6), or following a Non-Permitted Foreclosure Event, by providing notice to the Foreclosure Transferee that the City elects to exercise its Right of Reversion, which notice shall state the date for the Reversion Event.” Modification to Section 16.4.8 of the Original DDA 25..Section 16.4.8of the Original DDA is hereby deleted in its entirety and replaced with the following: Termination of Right of Reversion “. Except as set forth in Section 16.4.1(including clause (k) thereof) with respect to any Non-Permitted Foreclosure Event, the right of the City to exercise the Right of Reversion with respect to any Phase of the Project or the Property comprising such Phase shall terminate and be of no further force and effect upon the occurrence of the Equity Completion Date with respect to such Phase and, upon its receipt of written certification from an authorized officer of Developer for such Phase and such other information from Developer as the City may reasonably request to confirm that the Equity Completion Date has occurred (including invoices and evidence of payment of invoices in the required amounts without utilizing proceeds of any Permitted Mortgage for such purpose, and, for the avoidance of doubt, including all such costs incurred by the Developer named herein and any Affiliate thereof to which this Agreementis assigned in accordance with the terms and conditions of this Agreement), the City will confirm the same in writing to Developer and any applicable Permitted Mortgagee, with the City’s confirmation being conditioned upon such information provided by Developer being true and correct upon which the City shall be entitled to rely, but in the event the certification of a Developer is not true and correct, the City shall not be deemed to waive any rights against such Developer (but not any successor party that becomes a Developer in accordance with this Agreement) for such inaccuracy.” Modification to Section 17.1.1(f) of the Original DDA 26.. The second sentence of Section17.1.1(f) of the Original DDA is hereby deleted in its entirety and replaced with the following: “The Construction Loans in the aggregate with respect to Phase 1 and the Construction Loans in the aggregate with respect to Phase 2, determined separately with respect to each Phase, shall meet the following requirements: (i) the total loan to costratio (it being agreed that “costs” for purposes of such ratio shall mean (A) with respect to the Developer initially party to this Agreement and any Developer Affiliate thereof to which this Agreement is assigned in accordance with the terms and conditions of this Agreement, all costs and expenses actually incurred by such Developer and such Developer Affiliate in connection with the acquisition of the applicable Property and all costs and expenses contained in the budget of such Developer, or if this Agreement has been assigned in accordance with the terms and conditions of this Agreement to a Developer Affiliate, the budget of such Developer Affiliate (including any contingency line items) for the completion and lease-up of the applicablePhase) at the time of the encumbrance of the applicable Phase of the Property (counting both Construction Loans on any Phase if there is more than one Construction Loan on that Phase), (B)with respect to any Permitted Mortgagee or its Permitted Mortgagee Affiliate that acquires any applicable portion of the Property pursuant to a Foreclosure, the sum of (1) the amount described in the foregoing clause (A),plus(2) all costs and expenses actually incurred by such Permitted Mortgagee or its Permitted Mortgagee Affiliate in connection with the completion and lease-up of the applicablePhase, and/or, as applicable, (C)with respect to any Foreclosure Transferee that is not a Permitted Mortgagee or its Permitted Mortgagee Affiliate, the sum of (1)the amount paid bysuch Foreclosure Transferee in order to acquire that applicable portion of the Property in such Foreclosure, plus(2) all costs and expenses actually incurred by such Foreclosure Transferee in connection with the completion and lease-up of the applicablePhase) (counting both Tustin Cornerstone I First AmendmentCity of Tustin/ 16 Cornerstone I to DDA 06-12-2017 FINAL.docx Construction Loans on any Phase if there is more than one Construction Loan on that Phase)) shall not exceed sixty five percent (65%) and no second Construction Loan shall be permitted with respect to such Phase if at the time the second Construction Loan is proposed the first Construction Loan for such Phase meets or exceeds such loan to cost ratio with respect to the applicable Phase, (ii)the terms of each Construction Loan shall be consistent with the Financing Plan approved by theCity for the applicable Phase, (iii) neither the Property nor the Improvements thereon shall serve as collateral for any loan other than the Construction Loans described in this Section17.1.1(f), and (iv) there shall be no other Mortgages.” Modification to Section 17.1.2(a) of the Original DDA 27..Section 17.1.2(a) of the Original DDA is hereby deleted in its entirety and replaced with the following: “A Mortgage shall be a Permitted Mortgage under this Agreement and a Mortgagee shall be a Permitted Mortgageeentitled to a Transfer under this Agreement if the City determines in its sole discretion that: (i)such Mortgagee is a Qualified Institutional Lender or (ii) such Mortgagee is a lender that is regularly engaged in the business of making or owning (or, in the case of a fund advisor or manager, advising or managing with respect to a fund that is regularly engaged in the business of making or owning) commercial real estate loans (including mezzanine loans with respect to commercial real estate), originatingpreferred equity investments or owning or operating commercial properties, which Person is identified in and approved by the City in its sole discretion in connection with its approval of the Financing Plan for the relevant Phase approved by the City in Section4.6.1;(iii)the Mortgage shall be a Construction Loan and the terms of the Mortgage and all of the loan documents executed in connection with the loan shall be consistent with such Financing Plan and the requirements of Sections8.5and 17.1of this Agreement; (iv)complete copies of all of the loan documents have been reviewed by the City and the City has determined that such loan documents comply with the requirement of this Section17.1and, if applicable, Section17.3; and (v)the loan proceeds will be used solely to finance the acquisition of the Property and/or construction of the Improvements and for associated costs and expenses that directly relate to the Project (including financing costs) and for no other purpose.If requested by a Permitted Mortgagee, the loan documents shall include a Subordination Agreement executed by the Permitted Mortgagee and the City and acknowledged in Recordable form, which agreement shall be in the form and substance of the Subordination Agreement attached heretoasAttachment 24unless otherwise agreed by the City and such Permitted Mortgagee, each in its sole discretion, which shall be Recorded at the Close of Escrow for the portion of the Property being so encumbered, immediately after the Permitted Mortgage isRecorded.” Modification to Section 17.3 of the Original DDA 28.. The last sentence of Section 17.3of the Original DDA is hereby deleted in its entirety and replaced with the following: “Except as set forth in this Section 17.3, or in any Subordination Agreement executed by the City and any Permitted Mortgagee, nothing herein shall obligate Developer to seek City’s consent nor City to grant such consent to any amendment, modification, waiver, postponement, extension, replacement, renewal or termination of any Permitted Mortgage or the loan documents associated with such Permitted Mortgage; provided however, any Construction Loan proceeds distributed by Developer to its equity owners for purposes other than the payment of Development Costs which distribution has been authorized by the express terms of an amendment of the applicable loan documents made without the prior written approval of the City shall be excluded from the calculation of Permitted Mortgage Unpaid Balance.” Modification to Section 17.5 ofthe Original DDA 29..Section 17.5of the Original DDA is hereby deleted in its entirety and replaced with the following: Tustin Cornerstone I First AmendmentCity of Tustin/ 17 Cornerstone I to DDA 06-12-2017 FINAL.docx “If (a) a Permitted Mortgagee or its Permitted Mortgagee Affiliate acquires any Foreclosed Collateral as a result of a Foreclosure, the provisions of Sections 2.2.2(h) and 17.6and the Subordination Agreement shall apply to such acquisition and the rights and obligations of such Permitted Mortgagee or its Permitted Mortgagee Affiliate and (b) with respect to a Transfer by such Permitted Mortgagee or Permitted Mortgagee Affiliate to a new Transferee, the provisions of Sections 2.2.2(i)and 14.2.3shall apply to such acquisition and the rights and obligations of such Transferee. Subject to any Subordination Agreement then in effect between theCity and the applicable Permitted Mortgagee, all of the provisions contained in this Agreement shall be binding upon and benefit any Person acquiring title to all or any portion of the Property as a result of a Foreclosure and the Transfers described in Sections 2.2.2(h) and 2.2.2 (i)and provided that such Transferee assumes the applicable obligations of Developer under this Agreement in accordance with Section 2.2.2(h) or (i), as applicable, the City shall recognize such Transferee as Developer under this Agreement; provided, that nothing herein shall limit the rights of City contained in this Agreement, the Other Agreements or the Subordination Agreement to declare a Default, to void the Transfer if otherwise permitted by the terms of this Agreement or the Subordination Agreement (but in any event subject to the terms and conditions of Section 14.2.3hereof) or to exercise any other rights and remedies of the City with respect thereto.For the avoidance of doubt, if after a Foreclosure, the Permitted Mortgagee or Permitted Mortgagee Affiliate acquiring the Foreclosed Collateral desires to Transfer any portion thereof pursuant to the provisions of Section 2.2.3of this Agreement, then the provisions of Section 2.2.3(and not Section 2.2.2(i)or the provisions of the preceding sentence)shall apply to such Transfer.” Modification to Section 17.6.4 of the Original DDA 30.. The last sentence of Section17.6.4of the Original DDA is hereby deleted in its entirety. New Section 17.6.6. 31.The following text is added to the Original DDA as Section 17.6.6: “(d)Nothing contained in this Agreement shall (i) require any Permitted Mortgagee to obtain the City’s consent to acceptance of a deed-in-lieu of foreclosure by Permitted Mortgagee or its Permitted Mortgagee Affiliate in connection with a Foreclosure, or (ii)prevent a Permitted Mortgagee from seeking (nor require the City’s consent to) the appointment of a Qualified Receiver in connection with Permitted Mortgagee’s exercise of remedies pursuant to such Permitted Mortgagee’s loan documents. Notwithstanding anything to the contrary set forth in this Agreement, no action taken by a Permitted Mortgagee as described in this Section17.6.6shall constitute a breach, Default or unpermitted Transfer under this Agreement.” Modification to Section 18.6 of the Original DDA 32.. The following is added to the last sentence of Section 18.6 of the Original DDA: “; providedthat notwithstanding any other provision of this Agreement to the contrary, City shall be entitled to deliver the Notice to Mortgagee and any other notice required to be delivered by City to any Permitted Mortgagee under this Agreement, the Subordination Agreement and/or the Other Agreements to the address for such Permitted Mortgagee contained in the Permitted Mortgage (as amended) last Recorded, and no change to the name or address of any Permitted Mortgagee shall be deemed effective or binding on the City unless it is contained in a Recorded Permitted Mortgage (as amended) or Recorded assignment thereof or other document Recorded against the Parcel encumbered by the Permitted Mortgage, with a copy delivered to the City Clerk and to the City in accordancewith Section 18.6of this Agreement.” Modifications to Attachment 1 to the Original DDA 33..The definitions of the following terms in Attachment 1 to the Original DDA are hereby deleted in their entirety and replaced by the following: Tustin Cornerstone I First AmendmentCity of Tustin/ 18 Cornerstone I to DDA 06-12-2017 FINAL.docx Additional Liability Period a.““” shall mean (a) with respect to any Developer, the period of ownership of the Property and/or the Project or any portion thereof by any Developer Affiliate or any successor to such Developer Affiliate acquiring pursuant to Section 2.2.2(a) or (f); provided that in no event shall termination of the Additional Liability Period remove, reduce or modify the liability of Developer or its Developer Affiliates for Ongoing Matters with respect to such Developer or its Developer Affiliate; and (b) with respect to any Permitted Mortgagee or Permitted Mortgagee Affiliate which acquires title to any portion of the Property and/or Project pursuant to Section2.2.2(h), the period of ownership of the Property and/or the Project or any portion thereof by such Permitted Mortgagee or its Permitted Mortgagee Affiliate; provided that in no event shall termination of the Additional Liability Period remove, reduce or modify the liability of Permitted Mortgagee or its Permitted Mortgagee Affiliates) for Ongoing Matters with respect to such Permitted Mortgagee or its Permitted Mortgagee Affiliate.” Approved Foreclosure Purchaser b.The term “” is hereby deleted in its entirety and replaced where used in Section 17.6.3of the Original DDA with the term “Foreclosure Purchaser. City Estoppel c.““” 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 a Successor Owner.” Controlling Person d.““” shall mean, as to any Person, any other Person(s) who Control(s) such Person. Notwithstanding the foregoing, if a Person has the right to participate directly or indirectly (including through one or more intermediaries) in significant management decisions of a Person, such former Person shall not be deemed to be a Controlling Person of the latter Person unless such former Person also possesses, directly or indirectly (including through one or more intermediaries), the power to direct or cause the direction of the management and policies of the latter Person. The Controlling Person of the Developer party to this Agreement as of the Effective Date is collectively two or more of the following individuals: (i) Mark Potter, (ii) Eugene DelFavero or (iii) Martin Zieff.” Developer Affiliate e.““” shall mean (a) with respect to any Developer that Controls, or is Controlled by Flight Venture LLC or has the same Controlling Person as Flight Venture LLC, a Person for which any Affiliate of Alcion is the Controlling Person, or (b) with respect to any other Developer, a Person Controlled by or Controlling such Developer, or having the same Controlling Person as such Developer.” Foreclosure f.““” shall mean the completion of the following action: (a) a judicial or non- judicial foreclosure under a Permitted Mortgage that encumbers Developer’s interest in all or a portion of the Property, (b) if Mezzanine Financing is approved by the City, a UCC foreclosure (or other applicable foreclosure procedure) under a security instrument approved by the City in its sole discretion that encumbers the direct and/or indirect ownership interest in Developer, and/or (c)any transfer or conveyance of all or a portion of the Property or the direct and/or indirect ownership interest in Developer to a Permitted Mortgagee or a Permitted Mortgagee Affiliate (whether such Permitted Mortgagee Affiliate is the holder of the applicable Permitted Mortgage or the Permitted Mortgagee Affiliate is a designee to take title in order to keep the lien of the Permitted Mortgage in effect) in lieu of a foreclosure described in such clauses (a) or (b)(but without limiting the ability of the Permitted Mortgagee or a Permitted Mortgagee Affiliate to subsequently complete an actual foreclosure of the type described in clauses (a) or (b)thereafter).” Lien Release Amounts g.““” shall mean the amounts required to be paid to third parties to clear all monetary liens (including all Construction Liens) and Mortgages (other than Permitted Tustin Cornerstone I First AmendmentCity of Tustin/ 19 Cornerstone I to DDA 06-12-2017 FINAL.docx Mortgages) that encumber the Reacquired Property on the date of a Reversion Event or the date of the close of escrow pursuant to the Right of Repurchase and which, with respect to taxes and assessments, are past due or are then due and payable.For the avoidance of doubt, Lien Release Amounts do not include any sums payable to the City and comprising City Liens.” Permitted Mortgage Unpaid Balance h.““” shall mean (i) the amount of unpaid principal and accrued and unpaid interest due to a Permitted Mortgagee under its Construction Loanas of the date of the Repurchase Notice provided by City to Developer and, in accordance with Section 18.6, to the Permitted Mortgagee or, following a Foreclosure, to any Foreclosure Transferee, notifying such Person under Section16.3.1 that the City is exercising the Right of Repurchase or under Section 16.4.2 with respect to its Right of Reversion, less(ii) the amount of any payment by the City to the Permitted Mortgagee of principal and/or interest on its Construction Loan after the date of such Repurchase Notice. and less(iii) anyportion of the unpaid principal balance which constitutesConstructionLoan proceeds distributed by Developer to its equity owners for purposes other than the payment of Development Costs which distribution has been authorized by the express terms of an amendment of the applicable loan documents made without the prior written approval of the City.” Qualified Foreclosure Purchaser i.““” shall mean: (a)any Person, other than a Permitted Mortgagee or Permitted Mortgage Affiliate (each of which are excluded as not required to meet the standards set forth in Section2.2.2(i))that acquires Foreclosed Collateral at a judicial or non-judicial foreclosure sale or as a result of a Transfer from a Permitted Mortgagee or Permitted Mortgagee Affiliate following a Foreclosure that: (i)is licensed to do business in the State of California(if applicable); (ii)is Controlled by, Controls or has as its Controlling Person: (1) a Designated Developer or (2) any other developer of office buildings for which the Person (individually or with respect to any one of its Controlling Persons, key employees, principals, and/or management) has at least ten (10) years of experience in developing or owning commercial office buildings or campuses containing at least five hundred thousand (500,000) aggregate square feet of net rentable space; (iii)together with its Affiliates, within the preceding eighteen (18) months prior to the date of the Foreclosure, has not been the subject of any of the events or actions described in Section 2.2.5(excluding any insolvency that is not accompanied by another event or action described in Section 2.2.5) affecting more than ten percent (10%) of the aggregate assets, or assets under management, as applicable, of such Person and its Affiliates; (iv)has not, nor has its Controlling Person or any key employee thereof: (1) been indicted orconvicted for any felony or crime involving moral turpitude, (2) been debarred by any public entity in California, or (3) been engaged in litigation with the City or any other governmental entity within the preceding five (5) years (other than tax contests or litigation unrelated to development) where such party was not the successful litigant; and Tustin Cornerstone I First AmendmentCity of Tustin/ 20 Cornerstone I to DDA 06-12-2017 FINAL.docx (v)has, when determined in the aggregate for such Person and its Controlling Persons and Affiliates, (1) (A) with respect to Phase 1, a Net Worth of not less thanTwo Hundred Fifty Million Dollars ($250,000,000.00) (prior to the occurrence of the Equity Completion Date with respect to Phase1) or One Hundred Million Dollars ($100,000,000.00) (after the occurrence of the Equity Completion Date with respect to Phase 1) or (B) with respect to Phase 2, a Net Worth of not less than Two Hundred Fifty Million Dollars ($250,000,000.00) and (2)Liquidity of not less than Twenty-Five Million Dollars ($25,000,000.00) (provided that for the purposes of determining the foregoingNet Worth or Liquidity, any assets which are the subject of any of the events or actions described in Section 2.2.5and any accompanying liabilities shall be excluded), or shall have its obligations under this Agreement guaranteed by a Person that has NetWorth or Liquidity meeting the foregoing requirements, or (b)any other Person that is approved as a Qualified Foreclosure Purchaser by the City in its sole discretion.” Qualified Institutional Lender j.““” shall mean a Person, either directly or through its Affiliates, regularly engaged in the business of making, owning or investing in commercial real estate construction loans similar in size and nature to the Construction Loan (including mezzanine construction loans) or owning, developing and/or operating commercial properties similar in size and nature to the Project or applicable Phase thereof, and which has total assets (inclusive of unfunded capital commitments), individually or with its parent entities and Affiliates, in excess of Six HundredFifty Million Dollars ($650,000,000.00).” Repurchase Price k.““” shall mean: (i)if a Foreclosure has not occurred, an amount equal to (x) the greater of: (a) the Purchase Price paid by Developer to the City for the Phase comprising the Reacquired Property, less the amount $8.53 per square foot of land comprising the Reacquired Property (which is equal to the per square foot component of the Purchase Price for each Parcel attributable to the Project Fair Share Contribution, which the Parties agree shall not be repayable as part of the Repurchase Price) plus the hard and soft costs incurred by the then-current Developer in construction of the Vertical Improvements on the Reacquired Property, provided that if the portion of the land comprising the Reacquired Property is less than all of the Parcel of which it is a component, the Repurchase Price for the land that is included in the Reacquired Property shall be determined on a per square foot basis based on the original Purchase Price per square foot of land for the Phase containing the Reacquired Property and the Repurchase Price for the Vertical Improvements shall be based on the actual hard and soft costs incurred by Developer in construction of the Vertical Improvements located on the land included inthe Reacquired Property or (b) the Permitted Mortgage Unpaid Balance and reasonable costs (if any) incurred after delivery of the Repurchase Notice for the preservation and protection of the Reacquired Property, and (y) in each case less (A) the Lien Release Amounts (provided,however, in the event that any Lien Release Amounts in excess of unpaid property taxes are to be deducted from the Repurchase Price, then, at Permitted Mortgagee’s request, the City shall extend the close of escrow with respect to the Tustin Cornerstone I First AmendmentCity of Tustin/ 21 Cornerstone I to DDA 06-12-2017 FINAL.docx Reacquired Property for a period of one hundred eighty (180) days (which period shall be tolled during any period in which Permitted Mortgagee is prohibited from completing a Foreclosure by any applicable bankruptcy stay or other legal impediment) or such lesser time as it takes to permit Permitted Mortgage to complete a Foreclosure with respect to the Reacquired Property (and in the event the applicable Permitted Mortgagee is comprised of more than one Person and the City receives conflicting instructions from such Persons as to whether to proceed to close or extendthe closing as provided above, the Permitted Mortgagee shall be deemed to have elected to require that the City extend such close of escrow as provided above notwithstanding such conflicting instructions), in which event the Liens that are foreclosed and no longer due and payable shall be excluded from the Lien Release Amounts deducted from the Repurchase Price) (it being agreed that upon the completion of such Foreclosure, this clause (i)and not clause (ii)below shall apply with respect to the determination of the Repurchase Price), and less (B) the amount of the City Lien (in each case other than amounts constituting payment by the City of principal of or interest on any Permitted Mortgage that were actually applied to reduce the principal of and/or interest on the Construction Loan secured by the applicable Permitted Mortgage, if any such payment has been made at the option and in the sole discretion of the City and has been added to the City Lien), if any; or (ii)if a Foreclosure has occurred and the holder of a Permitted Mortgage or its Permitted Mortgagee Affiliate acquires the Foreclosed Collateral, then as to such Foreclosed Collateral, an amount equal to (x) (A) the Permitted Mortgage Unpaid Balance applicable to the Reacquired Property (assuming for such purpose that the applicable Construction Loan remains outstanding and has not been reduced by any amount bid by Permitted Mortgagee in connection with any applicable Foreclosure) through and including the date on which the Repurchase Notice is delivered to the Permitted Mortgagee or Permitted Mortgagee Affiliate (notwithstanding the occurrence of the applicable Foreclosure), plus (B) if the Repurchase Notice was not delivered to the Permitted Mortgagee or Permitted Mortgagee Affiliate until after the Foreclosure, to the extent that such costs have not been incorporated into the Permitted Mortgage Unpaid Balance under clause (A), all hard and soft costs incurred by such Permitted Mortgagee or its Permitted Mortgagee Affiliate following the Foreclosure in construction of the Vertical Improvements on, or materials for, the Reacquired Property and reasonable costs (if any) incurred for the preservation and protection of the Reacquired Property, in each case incurred through the date on which the Repurchase Notice is delivered to the Permitted Mortgagee or Permitted Mortgagee Affiliate and the reasonable costs (if any) incurred after delivery of such Repurchase Notice to the Permitted Mortgageeor Permitted Mortgagee less Affiliate for the preservation and protection of the Reacquired Property, (y) (A) the Lien Release Amounts and (B) the amount of the City Lien (in each case other than amounts constituting payment by the City of principal of orinterest on any Permitted Mortgage that were actually applied to reduce the principal of and/or interest on the Construction Loan secured by the applicable Permitted Mortgage, if any such payment has been made at the option and in the sole discretion of the City and has been added to the City Lien); or (iii)if a Foreclosure has occurred and the holder of a Permitted Mortgage or its Permitted Mortgagee Affiliate is not the Foreclosure Transferee, then, an amount equal to (x) the sum of (A) the amount paid by the applicable Foreclosure Transferee at the foreclosure sale for the Reacquired Property (but not in excess of the amount that would plus have otherwise been payable pursuant to clause (ii)(x)above), (B) if such Foreclosure Purchaser is a Qualified Foreclosure Purchaser and met the requirements of Tustin Cornerstone I First AmendmentCity of Tustin/ 22 Cornerstone I to DDA 06-12-2017 FINAL.docx Section2.2.2(h)with respect to its acquisition of the Foreclosed Collateral, then, as to such Foreclosed Collateral, all hard and soft costs incurred by such Foreclosure Transferee in construction of the Vertical Improvements on the Reacquired Property incurred through less the date on which the Repurchase Notice is delivered to such Foreclosure Transferee, (y) (A) the Lien Release Amounts and (B) the amount of the City Lien, if any; or (iv)if a Foreclosurehas occurred, and the Foreclosure Transferee has subsequently Transferred the Foreclosed Collateral to a third-party Transferee in compliance with the requirements of this Agreement, an amount equal to (x) the sum of (A) the purchase price paid by such subsequent Transferee for the Reacquired Property (but not in excess of the amount that would have otherwise been payable pursuant to clause(ii)(x) above), plus (B) all hard and soft costs incurred by such Transferee in construction of the Vertical Improvements on the Reacquired Property incurred through the date on which the Repurchase Notice is delivered to such Transferee, and (y) less the Lien Release Amounts and the amount of the City Lien, if any.” New Terms Added to Attachment 1 to the Original DDA 34..The following new definitions are hereby added to Attachment 1 to the Original DDA: Applicable Date a.““” shall have the meaning set forth in Section 1.2.4.” Affiliate b.““” shall mean, with respect to any Person, any other Person Controlling or Controlledby such first Person or any other Person that has the same Controlling Person as the first Person.” Foreclosure Transferee c.““” shall mean (a) a Permitted Mortgagee or its Permitted Mortgagee Affiliate acquiring Foreclosure Collateral (i) as the successful bidder at a trustee’s sale or a sale conducted to foreclose its Permitted Mortgage pursuant to a judicial foreclosure or (ii) as result of a deed in lieu of such foreclosure proceeding or (b) any other Person that is a successful bidder acquiring Foreclosure Collateral at a trustee’s sale or a sale conducted pursuant to a judicial foreclosure.” Non-Permitted Foreclosure Event d.““” shall mean that a Transfer for which the Transferee (other than the Permitted Mortgagee or its Permitted Mortgagee Affiliate) (a) acquires any Foreclosed Collateral through Foreclosure and either (i) fails within the time periods provided to comply with the requirements of Section2.2.2(h)applicable thereto or (ii) is not a Qualified Foreclosure Purchaser (whether through failure to satisfy the requirements to be a Qualified Foreclosure Purchaser or due to failure of City to approve in its sole discretion any non-complying Person as a Qualified Foreclosure Purchaser), or (b)acquires any Foreclosed Collateral pursuant to Section 2.2.2(i), and either (i) fails within the time periods provided to comply with the requirements of Section2.2.2(i)applicable thereto or (ii) is not a Qualified Foreclosure Purchaser (whether through failure to satisfy the requirements to be a Qualified Foreclosure Purchaser or due to failure of City to approve in its sole discretion any non-complying Person as a Qualified Foreclosure Purchaser).” Permitted Mortgagee Affiliate e.““” shall mean any Person Controlling or Controlled by a Permitted Mortgagee or having the same Controlling Person as does a Permitted Mortgagee.” Qualified Receiver f.““” shall mean a Person (individually or with respect to its Controlling Persons, key employees, principals, and/or management) with at least ten (10) years of experience in managing construction, or if construction is then complete, managing operation of office Tustin Cornerstone I First AmendmentCity of Tustin/ 23 Cornerstone I to DDA 06-12-2017 FINAL.docx buildings or campuses of at least Five Hundred Thousand (500,000) aggregate square feet or that has been approved by City, in its sole discretion, as a Qualified Receiver following Permitted Mortgagee’s request for such approval and City’s receipt of such information concerning said Person as reasonably requested by City.” Repurchase Notice g.““” shall mean, as the context may require, (a) as to Developer, the notice required to be delivered to Developer pursuant to Section 16.3.1hereof, (b) as to a Permitted Mortgagee or Permitted Mortgagee Affiliate, the Notice to Mortgagee that indicates the City has elected to exercise its Right of Repurchase, and (c) as to any other applicable Person, the notice delivered to such Person that indicates the City has elected to exercise its Right of Repurchase.” Modifications to Other Attachments to the Original DDA 35.. a.Attachment 6 (“Form of City Estoppel”) to the Original DDA is hereby deleted in its entirety and replaced with Attachment 6attached hereto and incorporated herein by this reference. b.Attachment 12 (“Form of Memorandum of DDA”) to the Original DDA is hereby deleted in its entirety and replaced with Attachment 12attached hereto and incorporated herein by reference. c.Attachment 18 (“Form of Developer Date Down Certificate Regarding Representations and Warranties”) is hereby amended by deleting paragraph 2 thereof in its entirety and replacing it with the following: “2. Financial and Other Information. The Financing Plan and all financial and other information submitted by the Developer to the City pursuant to Section 4.6of the DDA prior to or concurrent with the execution of the DDA, as updated in accordance with the requirements of Section 4.6.1and/or Section 4.6.2of the DDA and amended, is true and correct as of the date of this Date Down Certificate and all financial and other information submitted to the City on or since the Effective Date of the DDA, as updated and amended, is true and correct as of the date of this Date Down Certificate. The Financing Plan, as the same may have been updated in accordance with the requirements of Section 4.6.1and/or Section 4.6.2of the DDA, remains true andcorrect or, as modified to reflect Developer’s expectation as to available funding and costs, remains sufficient to pay through issuance of the Certificate of Compliance for Phase {1/2}, all Development Costs of such Phase of the Project and all other costs for the construction, marketing and lease of the Improvements as described in the Scope of Development for such Phase, including, in the case of Phase 1 (and in the case of Phase 2, to the extent not then completed in Phase 1), the Minimum Horizontal Improvements and the Project budget for the Minimum Improvements remains a reasonable budget. The “Loan” and the “Loan Documents” described in the Subordination Agreement being executed and delivered concurrent with the [[[1084,2444,1740,2497][11][,I,][Times New Roman]]Phase 1/Phase 2 Close of Escrow [[1720,2444,1770,2497][11][,,][Times New Roman]]] [[1751,2444,1837,2497][11][,,][Times New Roman]]are [[1821,2444,2150,2497][11][,,][Times New Roman]]consistent with the requirements of Section 17.1.1(f)of the DDA, do not include Mezzanine Financing {if City has approved Mezzanine Financing, add “that has not been approved by the City”}, and otherwise comply with the requirements of the DDA for Construction Loans and Permitted Mortgages, and the proceeds of the Loan will be used solely to finance the acquisition of the Property and/or construction of the Improvements and for associated costs and expenses that directly relate to the Project (including financing costs) and for no other purpose.” Tustin Cornerstone I First AmendmentCity of Tustin/ 24 Cornerstone I to DDA 06-12-2017 FINAL.docx d.Attachment 21 (“Form of Roadway and Utility Easement Agreement”) to the Original DDA is hereby deleted in its entirety and replaced with Attachment 21attached hereto and incorporated herein by reference. e.Attachment 22 (“Form of Pad Transferee Non-Disturbance and Attornment Agreement”) to the Original DDA is hereby deleted in its entirety and replaced with Attachment22attached hereto and incorporated herein by reference. f.Attachment 24 (“Form of Subordination Agreement”) to the Original DDA is hereby deleted in its entirety and replaced with Attachment 24attached hereto and incorporated herein by reference. g.Attachment 27 (“Form of Landscape Installation and Maintenance Agreement”) to the Original DDA is hereby deleted in its entirety and replaced with Attachment 27attached hereto and incorporated herein by reference. Approval of Phase 1 Mortgage 36.. As of the First Amendment Effective Date, the City has not received or approved the loan documents proposed to be entered into in connection with the Mortgage for Phase 1 and accordingly, the City reserves its right to review and approve, in its sole discretion, the foregoing documents in accordance with the Original DDA. The City Council hereby delegates review and approval of the foregoing agreements to the City Manager or its designee. The Parties acknowledge and agree that City approval of the foregoing shall be a condition precedent to the Phase 1 Property Close of Escrow ofthe benefit of the City, which approval shall be evidenced by the City’s execution of a Subordination Agreement for the Phase 1 Mortgage. The provisions of this Section 36are included as a statement of current progress and intent, and do not modify or waive any rights of the City to review and approve the loan documents for Phase 1 or Phase 2. Miscellaneous 37.. Agreement Ratified a.. Except as specifically amended or modified herein, each and every term, covenant, and condition of the Original DDA as amended is hereby ratified and shall remain in full force and effect. Each and every reference to the “Agreement” in the Original DDA (including, without limitation, the attachments thereto) shall be deemed to refer to the Original DDA as amended by this First Amendment. Governing Law b.. This instrument shall be interpreted and construed in accordance with the laws of the State of California. Binding Agreement c.. This First Amendment shall be binding upon and inure to the benefit of the Parties hereto and their respective successors and permitted assigns. Counterparts d.. This First Amendment may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same document. [[1046,2644,1372,2697][11][,I,][Times New Roman]][Signature page [[1343,2644,1393,2697][11][,I,][Times New Roman]]s [[1364,2644,1536,2697][11][,I,][Times New Roman]]follow] Tustin Cornerstone I First AmendmentCity of Tustin/ 25 Cornerstone I to DDA 06-12-2017 FINAL.docx IN WITNESSWHEREOF, City and Developer have signed this First Amendment as of the First Amendment Effective Date. CITY Dated:“” By: Jeffrey C. Parker, City Manager ATTEST: By: Erica Rabe, City Clerk 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 following page} Tustin Cornerstone I First Amendment City of Tustin/ S-1 to DDA 06-12-2017 FINAL.docxCornerstone I DEVELOPER “” FLIGHT VENTURE LLC, a Delaware limited liability company By: ____________________________ Name: ____________________________ Title: ____________________________ Dated: ____________________________ ACKNOWLEDGED AND AGREED ESCROW HOLDER “” FIRST AMERICAN TITLE INSURANCE COMPANY By: ____________________________ Name: ____________________________ Title: ____________________________ Dated: ____________________________ Tustin Cornerstone I First Amendment City of Tustin/ S-2 to DDA 06-12-2017 FINAL.docxCornerstone I ATTACHMENT 6 FORM OF CITY ESTOPPEL ________________, 20__ [[300,668,566,721][11][,I,][Times New Roman]][Transferee] _________________ _________________ Attn: ____________ Re:Tustin Legacy Cornerstone I Ladies and Gentlemen: Transferee The undersigned is writing this letter to you (“”) regarding that certain office project ProjectParcel (“”) that [[605,1220,1012,1273][11][,I,][Times New Roman]][has been] [may be] [[992,1220,1310,1273][11][,,][Times New Roman]]constructed on [[1272,1220,2047,1273][11][,I,][Times New Roman]][the Phase 1 Parcel/the Phase 2 Parcel] [[2027,1220,2093,1273][11][,,][Times New Roman]](“ [[2188,1220,2274,1273][11][,,][Times New Roman]]”). City The City of Tustin, a municipal corporation of the State of California (the “”) and Flight Developer Venture LLC, a Delaware limited liability company (“”) entered into that certain Tustin Legacy DDA Disposition and Development Agreement Cornerstone 1 dated as of _____________, 2016 (the “”), relating to the conveyance from the City to Developer of that certain real property described as the Development Parcels Development Parcels in the DDA(“”). All initially capitalized terms not otherwise defined herein shall have the meanings ascribed to such terms in the DDA. [[450,1690,2300,1742][11][B,I,][Times New Roman]]{Information provided in this paragraph and the paragraph below should relate only to the [[297,1743,2300,1795][11][B,I,][Times New Roman]]Parcel for which the estoppel is requested and the term “Property Documents” should include only the [[300,1796,775,1848][11][B,I,][Times New Roman]]applicable documents:} The City has executed that certain Declaration of Special Restrictions for Cornerstone I Phase 1 [[298,1950,666,2002][11][B,I,][Times New Roman]][Add correct title] [[642,1950,2299,2003][11][,,][Times New Roman]]dated _____________, recorded in the Official Records against title to the Development Parcels on _____________as Instrument No. __________ [[1388,2003,1438,2056][11][,I,][Times New Roman]][ [[1407,2003,1539,2056][11][,I,][Times New Roman]](the “ [[1512,2003,1679,2055][11][B,I,][Times New Roman]]Phase [[1640,2003,1690,2055][11][B,I,][Times New Roman]]1 [[1674,2003,2080,2055][11][B,I,][Times New Roman]]Special Restrictions [[2048,2003,2123,2056][11][,I,][Times New Roman]]”) [[2100,2003,2300,2056][11][,I,][Times New Roman]]and that [[300,2055,1346,2108][11][,I,][Times New Roman]]certain Declaration of Special Restrictions for Phase 2 [[1302,2055,1669,2107][11][B,I,][Times New Roman]][Add correct title] [[1634,2055,2300,2108][1 1][,I,][Times New Roman]], dated _____________, recorded [[300,2108,1922,2161][11][,I,][Times New Roman]]in the Official Records against title to the Development Parcels on _____________ [[1911,2108,2300,2161][11][,I,][Times New Roman]]as Instrument No. [[299,2161,556,2214][11][,I,][Times New Roman]]__________ [[542,2161,938,2214][11][,I,][Times New Roman]]([individually, the “ [[910,2161,1483,2213][11][B,I,][Times New Roman]]Phase 2 Special Restrictions [[1451,2161,2300,2214][11][,I,][Times New Roman]]” and collectively with the Phase 1 Special Special Restrictions [[298,2213,569,2266][11][,I,][Times New Roman]]Restrictions, [[544,2213,625,2266][11][,I,][Times New Roman]]/ ( [[585,2213,639,2266][11][,I,][Times New Roman]]] [[622,2213,745,2266][11][,,][Times New Roman]]the “ [[1105,2213,2300,2266][11][,,][Times New Roman]]”), which include, among other matters, certain requirements regarding the use and maintenance of the Development Parcels and set forth those provisions of the DDA that survive the issuance of a Certificate of Compliance with respect to the Project. The City has executed that certain Quitclaim Deed for Tustin Legacy Cornerstone I—Phase 1 and Covenants, Conditions and Restrictions, Including Environmental Restriction Pursuant to Civil Code Section 1471 dated _____________, recorded in the Official Records against title to the Development Parcels on _____________as Instrument No. __________ [[1429,2580,1479,2633][11][,I,][Times New Roman]][ [[1447,2580,1585,2633][11][,I,][Times New Roman]](the “ [[1558,2580,1743,2632][11][B,I,][Times New Roman]]Phase 1 [[1733,2580,2063,2632][11][B,I,][Times New Roman]]Quitclaim Deed [[2035,2580,2110,2633][11][,I,][Times New Roman]]”) [[2093,2580,2166,2633][11][,I,][Times New Roman]]an [[2139,2580,2300,2633][11][,I,][Times New Roman]]d that [[300,2632,1451,2685][11][,I,][Times New Roman]]certain Quitclaim Deed for Tustin Legacy Cornerstone I [[1415,2632,1466,2685][11][,I,][Times New Roman]]— [[1455,2632,2300,2685][11][,I,][Times New Roman]]Phase 2 and Covenants, Conditions and [[298,2685,2300,2738][11][,I,][Times New Roman]]Restrictions, Including Environmental Restriction Pursuant to Civil Code Section 1471, dated [[299,2738,1554,2791][11][,I,][Times New Roman]]_____________, which was recorded in the Official Records again [[1527,2738,2232,2791][11][,I,][Times New Roman]]st title to the Parcel on ___________ [[2204,2738,2300,2791][11][,I,][Times New Roman]]__ [[300,2791,921,2844][11][,I,][Times New Roman]]as Instrument No. __________ ( [[885,2791,1229,2844][11][,I,][Times New Roman]]individually the “ [[1202,2791,1682,2843][11][B,I,][Times New Roman]]Phase 2 Quitclaim Deed [[1655,2791,2300,2844][11][,I,][Times New Roman]]” and collectively with the Phase [[300,2843,652,2896][11][,I,][Times New Roman]]1 Quitclaim Deed [[625,2843,721,2896][11][,I,][Times New Roman]], / ( [[681,2843,735,2896][11][,I,][Times New Roman]]] [[715,2843,832,2896][11][,I,][Tim es New Roman]]the “ [[807,2843,1131,2895][11][B,I,][Times New Roman]]Quitclaim Deed [[1101,2843,1153,2895][11][B,I,][Times New Roman]][ [[1118,2843,1168,2895][11][B,I,][Times New Roman]]s [[1132,2843,1186,2895][11][B,I,][Times New Roman]]] [[1152,2843,1227,2896][11][,I,][Times New Roman]]”) [[1192,2843,1655,2896][11][,,][Times New Roman]], which Quitclaim Deed [[1628,2843,1713,2896][ 11][,I,][Times New Roman]][s] [[1693,2843,2300,2896][11][,,][Times New Roman]]conveyed to Developer the fee Tustin Cornerstone I First Amendment City of Tustin/ ATTACHMENT 6 to DDA 06-12-2017 FINAL.docxCornerstone I 1 title to the Development Parcels, subject to certain restrictions and limitations set forth in the Quitclaim Deed[[397,352,482,405][11][,I,][Times New Roman]][s] [[451,352,501,405][11][,,][Times New Roman]]. Developer and the City executed that certain Development Agreement, dated _______________, recorded in the Official Records against title to the Development Parcels on __________________as DA Instrument No. _______________ (the“”). Developer and the City executed that certain Landscape Installation and Maintenance Agreement dated _______________, recorded in the Official Records against title to the Development Parcels on Landscape Agreement __________________ as Instrument No. _______________ (the“”), and that certain Roadway,Landscape and Utility Easement Agreement dated ___________, recorded in the Official Records against title to the Development Parcels on _______________ as Instrument Roadway and Utility Easement No.__________________ (the“”). The DDA, the Memorandum of DDA, the Special Restrictions, the DA, the Quitclaim Deed[[2119,1029,2169,1082][11][,I,][Times New Roman]][ [[2137,1029,2187,1082][11][,I,][Times New Roman]]s [[2150,1029,2204,1082][11][,I,][Times New Roman]]] [[2173,1029,2300,1082][11][,,][Times New Roman]], the Landscape Agreement and the Roadway and Utility Easement are collectively referred to herein as the Property Documents “”. You have informed the undersigned City that Developer intends to Transfer its interest in the Development Parcels [[447,1290,991,1343][11][,I,][Times New Roman]][or specify portion thereof] [[974,1290,1162,1343][11][,,][Times New Roman]]or a dire [[1133,1290,2300,1343][11][,,][Times New Roman]]ct or indirect interest therein to Transferee on or around the Transaction date of this letter (the“”). By its execution of this letter, the City hereby confirms to Transferee, as of the date of this letter, to the actual knowledge of the City Manager, after consultation by the City Manager with, as to each such confirmation,the City Director of Finance orsuch other individualemployed by the City that the City Manager in good faith believes to be best informed as to such matter (and without any other duty of inquiry), that: 1.Except as set forth on Attachment 1to this letter, the Property Documents are in full force and effect and have not been modified or amendedand have not been assigned or otherwise transferred by the City to any other person or entity. 2.Except as set forth on Attachment 2to this letter: (i) there are no Potential Defaults and no Material Defaults under the DDA nor any other matters constituting “defaults” under any of the other Property Documents which would entitle the City to then exercise any of its rights or remedies under any of the Property Documents, including, without limitation, its Right of Reversion or Right of Repurchase pursuant to the DDA with respect to the Parcel; and (ii) the City has no claim of breach, counterclaim, lien or offset presently existing against Developer, the Project, the Development Parcels, including the Parcel under any of the Property Documents. The undersigned acknowledges that Transferee may 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 by Transferee as to the matters addressed herein. This letter may 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. [[[1064,2674,1519,2727][11][,I,][Times New Roman]]Signature page follows [[1487,2674,1537,2727][11][,,][Times New Roman]]] Tustin Cornerstone I First Amendment City of Tustin/ ATTACHMENT 6 to DDA 06-12-2017 FINAL.docxCornerstone I 2 CITY OF TUSTIN Dated: ________, 20__By: Name: _____________________________ City Manager Tustin Cornerstone I First Amendment City of Tustin/ ATTACHMENT 6 to DDA 06-12-2017 FINAL.docxCornerstone I 3 Attachment 1to City Estoppel Modifications, Supplements or Amendments to Property Documents 1.[[[465,607,1286,660][11][,I,][Times New Roman]]enter “None” if there are no qualifications [[1254,607,1304,660][11][,,][Times New Roman]]] Tustin Cornerstone I First Amendment City of Tustin/ ATTACHMENT 6 to DDA 06-12-2017 FINAL.docxCornerstone I 4 Attachment 2to City Estoppel Qualifications to Matters Confirmed in Estoppel 1.[[[465,607,1286,660][11][,I,][Times New Roman]]enter “None” if there are no qualifications [[1254,607,1304,660][11][,,][Times New Roman]]] Tustin Cornerstone I First Amendment City of Tustin/ ATTACHMENT 6 to DDA 06-12-2017 FINAL.docxCornerstone I 5 Attachment 12 Form of Memorandum of DDA ATTACHMENT 12 FORM OF 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 CORNERSTONE I This MEMORANDUM OF TUSTIN LEGACY DISPOSITION AND DEVELOPMENT Memorandum of DDA AGREEMENTCORNERSTONE I(this “”) is made as of ________, 2017 Memorandum Effective Date, (the “”)by and among the CITY OF TUSTIN, a municipal City corporationof the State of California (“”) and FLIGHT PHASE I OWNER LLC, a Delaware Developer limited liability company(“”), to confirm that the City and the Developer have entered into that certain Tustin Legacy Disposition and Development Agreement Cornerstone I, dated as of November 15,2016, as amended by that certain First Amendment to Tustin Legacy Disposition DDA and Development Agreement Cornerstone I dated as ofJune 20, 2017(collectively, the “”). Party The City and the Developer are sometimes referred to herein individually as a “”and Parties collectively as the “.”This Memorandum of DDA has been executed as of the Memorandum Effective Date and recorded in the Office of the County Recorder, Orange County, Official Records California (the “”)to provide record notice of the execution of the DDA by the Parties.Initially 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. 1.1.Development Parcels. The property affected by the DDA consists of the real propertydefined in the DDA as the Phase 1 Parcel and the Phase 2 Parcel, each as legally described and depicted on Exhibit “A”attached hereto and incorporated herein by reference,but excepting therefrom the matters set forth in Section2 of theQuitclaim Deeds(as defined below) Tustin Cornerstone I DDA Form City of Tustin/ ATTACHMENT 12 Memo of DDA (1st Am revised) Att Cornerstone I 1 12 6-11-2017 (agd).docx Development Parcels (taking into account such exceptions, the“”), together with (a)all existing improvements, if any, presently located thereon, and (b)all appurtenances pertaining to the Development Parcelsor such improvements, and (c)all permits, licenses, approvals and authorizations issued by any Governmental Authority in connection with the Development Parcels Property (collectively, the “”). 1.2.Quitclaim Deedand Conveyance.Under the terms of the DDA, at the Phase 1 Property Close of Escrow, the Phase 1 Property shall be conveyed by the City to Developer pursuant tothat certain“QUITCLAIM DEED FOR TUSTIN LEGACY CORNERSTONE I— PHASE 1ANDCOVENANTS, CONDITIONS AND RESTRICTIONS, INCLUDING ENVIRONMENTAL RESTRICTION PURSUANT TO CIVIL CODE SECTION 1471”(the Phase 1Property Quitclaim Deed “”).In addition, following timely exercise of the Option(more fully described in Section 2 below) in accordance with its terms by Developer, the Phase 2 Property shallbe conveyed atthe Phase 2 Property Close of Escrowpursuant tothat certain“QUITCLAIM DEED FOR TUSTIN LEGACY CORNERSTONE I—PHASE 2ANDCOVENANTS, CONDITIONS AND RESTRICTIONS, INCLUDING ENVIRONMENTAL RESTRICTION Phase 2Property Quitclaim Deed PURSUANT TO CIVIL CODE SECTION 1471”(the “”; the Phase 1 Property Quitclaim Deed and the Phase 2 Property Quitclaim Deed each individuallya Quitclaim DeedQuitclaim Deeds “”and collectively, the “”). 1.3.Special Restrictions.Prior to Recording of the Phase 1 Property Quitclaim Deed, the City shall execute and Recordthatcertain Declaration of Special Restrictions for Phase1 Phase 1 Special Restrictions affecting the Phase 1 Property (“”) andprior to Recording of the Phase 2 Property Quitclaim Deed, the City shall execute and Record that certain Declaration of Phase 2 Special Restrictions, Special Restrictions for Phase 2 affecting the Phase 2 Property(“” Special Restrictions and collectively with the Phase 1 Special Restrictions, the “”), eachof which shall be acknowledged and accepted by Developer. The DDA, this Memorandum of DDA, and all covenants, conditions, restrictions and obligations set forth in (a)the Phase 1Property Quitclaim Deedand the Phase 1 Special Restrictionsshall be binding uponthe portion of the Property conveyed by the Phase 1Property Quitclaim Deed,and (b) the Phase 2Property Quitclaim Deedandthe Phase 2 Special Restrictionsshall be binding uponthe portion of the Property conveyed by the Phase 2Property Quitclaim Deed, which unless and until terminated in accordance with their respective terms, shallgovern the use and development of the Property by Developer. 2.Option.The DDA provides an Option in favor of Developerto acquire the Phase2 Property which shall become effective only upon the occurrence of the Phase 1 Property Close of Escrow. TheOption may be extended by Developer annually on the anniversary of the Phase 1 Property Close of Escrow for a term not to exceed ten (10) years, upon paymentmade pursuant to the terms of the DDA. Once the Option is exercised, the Option Term may not be further extended. The Option shall automatically terminate upon the termination of the DDAwithout requirement for further action by the Parties.Further provisions relating to exercise and/or termination of the Option are set forth in the DDA. 3.Effect of the DDA. The DDA imposes certain obligations, agreements, covenants, conditions and restrictions with respect to the Development Parcels and with respect to Developer's and its Successor Owner's acquisition, development, use, operation and ultimate disposition Tustin Cornerstone I DDA Form City of Tustin/ ATTACHMENT 12 Memo of DDA (1st Am revised) Att Cornerstone I 2 12 6-11-2017 (agd).docx 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 on Transfer (including without limitation, conveyance, lease and/or assignment) of Developer's interests under the DDA and/or in the Property (and the Improvements located thereon)or any portion thereof or interest therein, whether voluntary or involuntary, and certain restrictions on the Transfer of Control of Developer or Developer's Controlling Person contained in Section2of the DDA, and certain restrictions on Transfer to a Foreclosure Transferee that will terminate as to the Development Parcels subject thereto upon execution and recordation by the City of a Certificate of Compliance; (b)Certain restrictions on Mortgages contained in,among other provisions, Sections1.2.4, 2.2.2,2.2.7,2.2.8, 4.7.2and17of the DDA, including without limitation, restrictions on encumbrance ofthe Development Parcels with a Mortgageand certain obligations imposed upon Mortgagees in the event of a Foreclosure, which limitations will terminate as to the Development Parcels subject thereto upon execution and recordation by the City of a Certificate of Compliance; (c)The releases contained in Section4.5.2of the DDA,which are restated in each of the Quitclaim Deed(s),and the indemnities and other environmental provisions contained in Section 10of the DDA,which are restated in the Special Restrictions, each of which remain in effect for the term set forth therein and are binding upon Developer and 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, as and to the extent set forth in the respective Quitclaim Deeds and the Special Restrictions; (d)To the extent provided underthe DDA, the indemnities set forth in Sections5.5,8.8.5,8.9,8.11,8.12,10.1,10.2and 18.11of the DDA shall (i)run with the land, (ii)survive the Close of Escrow and shall not merge into any of theQuitclaim Deed(s), and (iii)survive the sale of land to each Transferee, including without limitation, each Pad Transferee. (e)The Right of Repurchase in favor of the City, contained in Section16.3of the DDA (copied verbatim below), that terminates as to the portion of the Development Parcels subject thereto upon execution and recordation by the City of a Certificate of Compliance; and (f)The Right of Reversion in favor of the City contained in Section16.4of the DDA (copied verbatim below), that terminates as to the portion of the Development Parcels subject theretoas set forth in Section16.4.1 (including clause (k) thereof) andSection 16.4.8of the DDA and otherwiseupon execution and recordation by the City of a Certificate of Compliance. 4.Right of Repurchase and Right of Reversion. For ease of reference only, the following italicized Sections16.3and 16.4are copied verbatim from the DDAand the term Repurchase Price “”as used herein shall have the meaning set forth in the DDA: [[599,2769,1054,2826][12][B,I,][Times New Roman]]Right of Repurchase [[1025,2769,1076,2826][12][B,I,][Times New Roman]]. [[450,2770,500,2827][12][,I,][Times New Roman]]“ [[478,2770,591,2827][12][,I,][Times New Roman]]16.3 [[2076,2876,2300,2933][12][B,I,][Times New Roman]]Right of [[448,2877,1070,2934][12][,I,][Times New Roman]]For the period described in [[1037,2877,1352,2934][12][,I,][Times New Roman]]Section 16.3.3 [[1327,2877,2099,2934][12][,I,][Times New Roman]], the City shall have the right (the “ [[299,2934,573,2991][12][B,I,][Times New Roman]]Repurchase [[545,2935,1867,2992][12][,I,][Times New Roman]]”), from time to time, at any time after the date that Developer [[1851,2935,2300,2992][12][,I,][Times New Roman]]became in Material Tustin Cornerstone I DDA Form City of Tustin/ ATTACHMENT 12 Memo of DDA (1st Am revised) Att Cornerstone I 3 12 6-11-2017 (agd).docx [[298,300,2300,357][12][,I,][Times New Roman]]Default and after the expiration of any applicable notice and cure periods in favor of a Mortgagee [[299,357,2300,414][12][,I,][Times New Roman]]with respect to such Material Default to (re)purchase, enter and possess the following [[343,414,810,471][12][B,I,][Times New Roman]]Reacquired Property [[300,415,366,472][12][,I,][Times New Roman]](“ [[782,415,984,472][12][,I,][Times New Roman]]”): (a) [[963,415,1427,472][12][,I,][Times New Roman]]all or any portion o [[1393,415,2300,472][12][,I,][ Times New Roman]]f the Phase 1 or Phase 2 Property (as [[300,472,2300,529][12][,I,][Times New Roman]]applicable), (b) any Improvements thereon, (c) all applicable Entitlements and other development [[300,530,2300,587][12][,I,][Times New Roman]]rights, consents, authorizations, variances, waivers, licenses, permits, certificates and approvals [[291,587,817,644][12][,I,][Times New Roman]]from any governmental [[800,587,1009,644][12][,I,][Times New Roman]]or quasi [[973,587,1023,644][12][,I,][Times New Roman]]- [[987,587,2300,644][12][,I,][ Times New Roman]]governmental authority, and (d) all other appurtenant rights [[300,645,2300,702][12][,I,][Times New Roman]]applicable to the respective Property, including the interest in any ground leases encumbering the [[300,702,1986,759][12][,I,][Times New Roman]]respective Property. A Right of Repurchase with respect to all or a portion of the Ph [[1961,702,2300,759][12][,I,][Times New Roman]]ase 1 Property [[300,760,2300,817][12][,I,][Times New Roman]]shall not result in a Right of Repurchase with respect to all or a portion of the Phase 2 Property, [[300,817,2300,874][12][,I,][Times New Roman]]and vice versa. The Reacquired Property designated by the City shall be acquired by the City for [[300,875,1251,932][12][,I,][Times New Roman]]the Repurchase Price and otherwise in accor [[1220,875,1578,932][12][,I,][Times New Roman]]dance with this [[1544,875,1819,932][12][,I,][Times New Roman]]Section 16.3 [[1794,875,2301,932][12][,I,][Times New Roman]]. In the event the City [[300,932,2027,989][12][,I,][Times New Roman]]exercises its Right of Repurchase as to any Reacquired Property as provided in this [[1990,932,2262,989][12][,I,][Times New Roman]]Section 16.3 [[2238,932,2288,989][12][,I,][Times New Roman]], [[300,990,2300,1047][12][,I,][Times New Roman]]this Agreement shall terminate with respect to the Reacquired Property as of the date of the [[300,1048,575,1105][12][,I,][Times New Roman]]quitclaim de [[547,1048,2300,1105][12][,I,][Times New Roman]]ed conveying to the City title to the Reacquired Property; provided that the provisions [[300,1105,474,1162][12][,I,][Times New Roman]]of this [[437,1105,709,1162][12][,I,][Times New Roman]]Section 16.3 [[696,1105,1685,1162][12][,I,][Times New Roman]]shall survive the termination of this Agreement. [[749,1211,1487,1268][12][B,I,][Times New Roman]]Exercise of Right of Repurchase [[600,1212,750,1269][12][,I,][Times New Roman]]16.3.1 [[1459,1212,1509,1269][12][,I,][Times New Roman]]. [[1516,1212,2300,1269][12][,I,][Times New Roman]]The City may exercise its Right of [[298,1270,2300,1327][12][,I,][Times New Roman]]Repurchase by delivering written notice to Developer and any Permitted Mortgagee whose [[300,1327,1469,1384][12][,I,][Times New Roman]]address is on file in the Official Records (as described in [[1430,1327,1700,1384][12][,I,][Times New Roman]]Section 18.6 [[1669,1327,2300,1384][12][, I,][Times New Roman]]) or following a Foreclosure, [[300,1385,1004,1442][12][,I,][Times New Roman]]by providing notice to the Forec [[975,1385,2300,1442][12][,I,][Times New Roman]]losure Transferee, that the City elects to exercise its Right of [[298,1442,2300,1499][12][,I,][Times New Roman]]Repurchase, stating that the City is exercising its Right of Repurchase and specifying the [[298,1500,2300,1557][12][,I,][Times New Roman]]Reacquired Property; provided that such notice is delivered at least ninety (90) calendar days [[293,1557,434,1614][12][,I,][Times New Roman]]prior [[415,1557,2301,1614][12][,I,][Times New Roman]]to the date on which the City requires Developer to convey the Property to the City pursuant [[300,1615,1659,1672][12][,I,][Times New Roman]]to the Right of Repurchase and otherwise in accordance with this [[1621,1615,1893,1672][12][,I,][Times New Roman]]Section 16.3 [[1868,1615,1918,1672][ 12][,I,][Times New Roman]]. [[749,1721,939,1778][12][B,I,][Times New Roman]]Process [[600,1722,750,1779][12][,I,][Times New Roman]]16.3.2 [[908,1722,2300,1779][12][,I,][Times New Roman]]. If the City is entitled to and timely elects to repurchase any [[300,1780,397,1837][12][,I,][Times New Roman]]des [[366,1780,2300,1837][12][,I,][Times New Roman]]ignated Reacquired Property, the Parties shall: (a) within five (5) Business Days after the date [[300,1837,2300,1894][12][,I,][Times New Roman]]of the City’s notice of election to exercise the Right of Repurchase, open an escrow with an escrow [[300,1895,1522,1952][12][,I,][Times New Roman]]agent designated by the City for the purchase and sale, an [[1497,1895,2301,1952][12][,I,][Times New Roman]]d shall execute an escrow agreement [[300,1952,2300,2009][12][,I,][Times New Roman]]that shall provide that Developer shall pay all costs of the escrow and shall include such usual [[300,2010,2300,2067][12][,I,][Times New Roman]]and ordinary terms as are reasonably required by the escrow agent and by the transaction; (b) no [[300,2067,816,2124][12][,I,][Times New Roman]]later than five (5) Busine [[788,2067,2300,2124][12][,I,][Times New Roman]]ss Days after the opening of escrow, Developer shall place into the escrow [[300,2125,2300,2182][12][,I,][Times New Roman]]appropriate quitclaim deeds and bill of sale conveying fee title to the Reacquired Property; and [[300,2182,810,2239][12][,I,][Times New Roman]](c) no later than eighty [[782,2182,832,2239][12][,I,][Times New Roman]]- [[790,2182,2037,2239][12][,I,][Times New Roman]]five (85) calendar days after the opening of the escrow, th [[2012,2182,2301,2239][12][,I,][Times New Roman]]e City shall [[300,2240,1717,2297][12][,I,][Times New Roman]]deposit into the escrow an amount equal to the Repurchase Price. [[1683,2240,2301,2297][12][,I,][Times New Roman]]The escrow shall close, and [[300,2297,2300,2354][12][,I,][Times New Roman]]title to the Reacquired Property shall be conveyed to the City, and the Repurchase Price shall be [[293,2355,1355,2412][12][,I,][Times New Roman]]paid, if there is then a Permitted Mortgage, in acc [[1327,2355,1642,2412][12][,I,][Times New Roman]]ordance with [[1607,2355,1779,2412][12][,I,][Time s New Roman]]Section [[1765,2355,1915,2412][12][,I,][Times New Roman]]16.3.5 [[1890,2355,2300,2412][12][,I,][Times New Roman]], or if there is not [[300,2412,1100,2469][12][,I,][Times New Roman]]then a Permitted Mortgage, to the then [[1075,2412,1125,2469][12][,I,][Times New Roman]]- [[1091,2412,2300,2469][12][,I,][Times New Roman]]owner of the Reacquired Property acquired by the City no [[300,2470,2288,2527][12][,I,][Times New Roman]]later than five (5) Business Days after the City has deposited into escrow the Repurchase Price. [[300,2527,643,2584][12][,I,][Times New Roman]]Concurrently w [[627,2527,2301,2584][12][,I,][Times New Roman]]ith the close of escrow, Developer shall comply with its obligations under [[300,2585,472,2642][12][,I,][Times New Roman]]Section [[459,2585,572,2642][12][,I,][Times New Roman]]14.3 [[547,2585,2300,2642][12][,I,][Times New Roman]]. Nothing herein shall restrict the right of the City to terminate its exercise of the [[298,2642,1936,2699][12][,I,][Times New Roman]]Right of Repurchase at any time prior to the close of escrow The Parties agree t [[1900,2642,2300,2699][12][,I,][Times New Roman]]hat the amount of [[300,2700,2300,2757][12][,I,][Times New Roman]]reduction in the Repurchase Price as compared with the Purchase Price is justified in that it bears [[300,2757,2300,2814][12][,I,][Times New Roman]]a reasonable relationship to the damages which the Parties estimate may be suffered by the City [[300,2815,1171,2872][12][,I,][Times New Roman]]as the result of the Developer’s Material [[1133,2815,2301,2872][12][,I,][Times New Roman]]Default in the performance of its obligations under this [[297,2872,2300,2929][12][,I,][Times New Roman]]Agreement, which damages would be impractical or extremely difficult to quantify, and that the Tustin Cornerstone I DDA Form City of Tustin/ ATTACHMENT 12 Memo of DDA (1st Am revised) Att Cornerstone I 4 12 6-11-2017 (agd).docx [[300,300,2300,357][12][,I,][Times New Roman]]remedy provided for herein is not a penalty or forfeiture, and is a reasonable limitation on the [[298,357,491,414][12][,I,][Times New Roman]]Develop [[466,357,1633,414][12][,I,][Times New Roman]]er’s potential liability as a result of Developer’s default. [[750,464,1571,521][12][B,I,][Times New Roman]]Termination of Right of Repurchase [[600,465,750,522][12][,I,][Times New Roman]]16.3.3 [[1543,465,2301,522][12][,I,][Times New Roman]]. The Right of Repurchase shall [[300,523,2300,580][12][,I,][Times New Roman]]remain in effect from the Close of Escrow with respect to any portion of the Property until the [[298,580,869,637][12][,I,][Times New Roman]]Recording by the City of [[839,580,2300,637][12][,I,][Times New Roman]]a Certificate of Compliance with respect thereto. In the event that [[298,637,2300,694][12][,I,][Times New Roman]]Developer or any Person on behalf of Developer either (a) cures the Material Default which is the [[300,695,2071,752][12][,I,][Times New Roman]]basis for the City’s exercise of its Right of Repurchase, but excluding any Transfer in v [[2042,695,2300,752][12][,I,][Times New Roman]]iolation of [[300,752,2300,809][12][,I,][Times New Roman]]this Agreement, or (b) Completes the Phase 1 Project or the Phase 2 Project, as applicable, prior [[300,810,2300,867][12][,I,][Times New Roman]]to the closing of escrow on such Right of Repurchase, such Right of Repurchase shall cease and [[300,867,1381,924][12][,I,][Times New Roman]]terminate with respect to such Material Default onl [[1340,867,2300,924][12][,I,][Times New Roman]]y. With respect to any Material Defaults for [[299,925,2300,982][12][,I,][Times New Roman]]which the City seeks to exercise the Right of Repurchase and which, by their nature, are not [[300,982,2300,1039][12][,I,][Times New Roman]]curable (which shall include, by way of example only, and not as a limitation, the failure to give [[300,1040,696,1097][12][,I,][Times New Roman]]notice or provide [[659,1040,2300,1097][12][,I,][Times New Roman]]evidence of insurance prior to entering the Parcel), but excluding any Transfer [[300,1097,2300,1154][12][,I,][Times New Roman]]in violation of this Agreement and any Material Default under the Schedule of Performance [[300,1155,2053,1212][12][,I,][Times New Roman]](except as set forth in clause (b) above, in which case the preceding sentence shall a [[2021,1155,2300,1212][12][,I,][Times New Roman]]pply), such [[298,1212,2300,1269][12][,I,][Times New Roman]]Default shall be deemed cured if Developer takes the required action promptly following [[298,1270,2300,1327][12][,I,][Times New Roman]]Developer’s becoming aware of such failure and the City is not adversely affected by such Default, [[300,1327,1477,1384][12][,I,][Times New Roman]]has not relied on the performance of the applicable provi [[1441,1327,2300,1384][12][,I,][Times New Roman]]sion of this Agreement that is the subject [[300,1385,2300,1442][12][,I,][Times New Roman]]of such Default to the detriment of the City or suffered any actual damage as a result of such [[298,1442,512,1499][12][,I,][Times New Roman]]Default. [[749,1549,1171,1606][12][B,I,][Times New Roman]]Release of Liability [[600,1550,750,1607][12][,I,][Times New Roman]]16.3.4 [[1143,1550,2300,1607][12][,I,][Times New Roman]]. In the event the City exercises its Right of Repurchase, [[300,1607,757,1664][12][,I,][Times New Roman]]such purchase shall r [[726,1607,2300,1664][12][,I,][Times New Roman]]elease each of City and the Developer owning the Reacquired Property from [[300,1665,2300,1722][12][,I,][Times New Roman]]all liability and obligations under this Agreement and the Other Agreements with respect to the [[298,1722,2172,1779][12][,I,][Times New Roman]]Reacquired Property except for the following obligations of Developer, from which Deve [[2144,1722,2300,1779][12][,I,][Times New Roman]]loper [[300,1780,2300,1837][12][,I,][Times New Roman]]shall not be released and which in addition shall continue to be “Guaranteed Obligations” as [[300,1837,2300,1894][12][,I,][Times New Roman]]such term is defined in each Guaranty provided in connection with the acquisition of the [[298,1895,1132,1952][12][,I,][Times New Roman]]Reacquired Property by Developer: (a) [[1111,1895,1773,1952][12][,I,][Times New Roman]]Ongoing Matters and any other [[1754,1895,2300,1952][12][,I,][T imes New Roman]]obligations of Developer [[300,1952,1363,2009][12][,I,][Times New Roman]]that are addressed by the terms of the Guaranty; (b) [[1342,1952,2301,2009][12][,I,][Times New Roman]]the release provided for the benefit of the City [[293,2010,579,2067][12][,I,][Times New Roman]]pursuant to [[541,2010,880,2067][12][,I,][Times New Roman]]Section 4.5.2(f) [[847,2010,964,2067][12][,I,][Times New Roman]]; (c) [[942,2010,2300,2067][ 12][,I,][Times New Roman]]the obligation to return any written Due Diligence Information to [[300,2067,800,2124][12][,I,][Times New Roman]]the City as provided in [[761,2067,881,2124][12][,I,][Times New Roman]]Sect [[845,2067,1033,2124][12][,I,][Times New Roman]]ion 14.3 [[1007,2067,1126,2 124][12][,I,][Times New Roman]]; (d) [[1106,2067,2300,2124][12][,I,][Times New Roman]]the obligation to indemnify, defend and hold harmless the [[300,2125,2300,2182][12][,I,][Times New Roman]]City Indemnified Parties as provided in Article 10 for matters arising or related to the period of [[300,2182,1759,2239][12][,I,][Times New Roman]]time prior to the conveyance of the Reacquired Property to the City; (e) [[1736,2182,2032,2239][12][,I,][Times New Roman]]Developer’s [[1993,2182,2300,2239][12][,I,][Times New Roman]]obligation to [[300,2240,1958,2297][12][,I,][Times New Roman]]indemnify, defend and hold harmless the City Indemnified Parties as provided in [[1920,2240,2167,2297][12][,I,][Times New Roman]]Section 5.5 [[2154,2240,2300,2297][12][,I,][Times New Roman]]as to [[300,2297,2300,2354][12][,I,][Times New Roman]]a Parcel for matters arising or related to the period prior to the Close of Escrow for such Parcel, [[300,2355,1201,2412][12][,I,][Times New Roman]]and such liability and obligations shall sur [[1170,2355,2300,2412][12][,I,][Times New Roman]]vive the close of escrow and shall not be merged into [[300,2412,2300,2469][12][,I,][Times New Roman]]the quitclaim deed, it being acknowledged and agreed that all other obligations under this [[297,2470,2300,2527][12][,I,][Times New Roman]]Agreement related to the Reacquired Property shall be released and terminated as of the date on [[299,2527,660,2584][12][,I,][Times New Roman]]which the Requi [[624,2527,2300,2584][12][,I,][Times New Roman]]red Property is conveyed to the City. In no event shall the Guaranty provided at [[300,2585,2300,2642][12][,I,][Times New Roman]]the Close of Escrow for the relevant phase (or any Guaranty approved by the City in its sole [[300,2642,2002,2699][12][,I,][Times New Roman]]discretion as a replacement for such original Guaranty) to secure the obligations [[1987,2642,2300,2699][12][,I,][Times New Roman]]of Developer [[300,2700,2300,2757][12][,I,][Times New Roman]]under this Agreement and the Other Agreements with respect to the portion of the Property [[300,2758,2300,2815][12][,I,][Times New Roman]]containing the Reacquired Property be released or terminated as a result of the exercise by the [[300,2815,1486,2872][12][,I,][Times New Roman]]City of the Right of Repurchase. Following the close of [[1466,2815,2300,2872][12][,I,][Times New Roman]]escrow with respect to the Reacquired [[298,2873,2300,2930][12][,I,][Times New Roman]]Property, under no circumstances shall Developer have any right or claim to, or against, the [[298,2930,2300,2987][12][,I,][Times New Roman]]Reacquired Property. Notwithstanding the purchase of the Reacquired Property by the City as Tustin Cornerstone I DDA Form City of Tustin/ ATTACHMENT 12 Memo of DDA (1st Am revised) Att Cornerstone I 5 12 6-11-2017 (agd).docx [[293,300,667,357][12][,I,][Times New Roman]]provided in this [[631,300,804,357][12][,I,][Times New Roman]]Section [[791,300,904,357][12][,I,][Times New Roman]]16.3 [[879,300,929,357][12][,I,][Times New Roman]], [[905,300,2300,357][12][,I,][Times New Roman]]this Agreement shall remain in full force and effect with respect to [[300,357,1432,414][12][,I,][Times New Roman]]the portions of the Property not purchased by the City. [[749,464,1280,521][12][B,I,][Times New Roman]]Rights of Third Parties [[600,465,750,522][12][,I,][Times New Roman]]16.3.5 [[1250,465,1300,522][12][,I,][Times New Roman]]. [[1304,465,2300,522][12][,I,][Times New Roman]]The Right of Repurchase shall be a lien and [[300,523,2300,580][12][,I,][Times New Roman]]encumbrance on the Property that shall be paramount to the lien and charge of (a) any Mortgage [[300,580,2300,637][12][,I,][Times New Roman]]upon the Parcels or Improvements, and (b) all other liens, including Construction Liens that may [[300,637,737,694][12][,I,][Times New Roman]]attach to the Develo [[704,637,2300,694][12][,I,][Times New Roman]]pment Parcels or the Improvements thereon. With respect to a lien that is a [[300,695,2300,752][12][,I,][Times New Roman]]Construction Loan secured by a Permitted Mortgage, (i) the implementation of the Right of [[298,752,2154,809][12][,I,][Times New Roman]]Repurchase shall be subject to the terms of the Subordination Agreement between the City a [[2129,752,2300,809][12][,I,][Times New Roman]]nd the [[300,810,2300,867][12][,I,][Times New Roman]]applicable Permitted Mortgagee, (ii) the Repurchase Price paid by the City hereunder, which shall [[300,867,2300,924][12][,I,][Times New Roman]]be calculated in accordance with this Agreement, shall be paid into the escrow established [[293,925,583,982][12][,I,][Times New Roman]]pursuant to [[548,925,720,982][12][,I,][Times New Roman]]Section [[711,925,861,982][12][,I,][Times New Roman]]16.3.2 [[835,925,1557,982][12][,I,][Times New Roman]], (iii) such Permitted Mortgagee s [[1526,925,2300,982][12][,I,][Times New Roman]]hall deliver a payment demand into [[300,982,2300,1039][12][,I,][Times New Roman]]such escrow for the Permitted Mortgage Unpaid Balance due to such Permitted Mortgagee plus [[300,1040,2300,1097][12][,I,][Times New Roman]]any other amounts owed to the Permitted Mortgagee under the applicable loan documents up to [[300,1097,1130,1154][12][,I,][Times New Roman]]the amount of the Repurchase Price, an [[1105,1097,2300,1154][12][,I,][Times New Roman]]d (iv) the Repurchase Price, up to the amount due to the [[298,1155,2300,1212][12][,I,][Times New Roman]]Permitted Mortgagee in such payment demand, shall be paid from such escrow directly to the [[300,1212,2300,1269][12][,I,][Times New Roman]]applicable Permitted Mortgagee (or, if there shall be more than one Permitted Mortgagee, to the [[298,1270,599,1327][12][,I,][Times New Roman]]Permitted Mo [[575,1270,1773,1327][12][,I,][Times New Roman]]rtgagee that the City has been notified in accordance with [[1733,1270,2003,1327][12][,I,] [Times New Roman]]Section 18.6 [[1989,1270,2300,1327][12][,I,][Times New Roman]]by the holder [[300,1327,2300,1384][12][,I,][Times New Roman]]of the first priority Permitted Mortgage encumbering the applicable Property that it is the holder [[300,1385,1780,1442][12][,I,][Times New Roman]]of the first priority Permitted Mortgage encumbering the applicable Pro [[1748,1385,2301,1442][12][,I,][Times New Roman]]perty) before payment of [[300,1442,2300,1499][12][,I,][Times New Roman]]the Repurchase Price is paid to Developer or any other Person, and Developer authorizes payment [[300,1500,2300,1557][12][,I,][Times New Roman]]of the applicable portion of the Repurchase Price to the Permitted Mortgagee pursuant to such [[293,1557,1211,1614][12][,I,][Times New Roman]]payment demand (absent manifest error on [[1173,1557,2300,1614][12][,I,][Times New Roman]]such payment demand). Developer agrees to execute, [[300,1615,2300,1672][12][,I,][Times New Roman]]acknowledge and deliver appropriate documents, including, but not limited to escrow instructions, [[300,1672,2300,1729][12][,I,][Times New Roman]]approvals of valid payment demands and approvals of draft closing statements as required to [[300,1730,598,1787][12][,I,][Times New Roman]]effectuate the [[576,1730,2301,1787][12][,I,][Times New Roman]]foregoing. The Right of Repurchase shall not defeat or render invalid or limit any [[300,1787,2300,1844][12][,I,][Times New Roman]]rights or interests provided in easements, covenants, conditions or restrictions in favor of third [[293,1845,1770,1902][12][,I,][Times New Roman]]parties (i.e., Persons other than Developer or Developer Affiliates) gran [[1745,1845,2301,1902][12][,I,][Times New Roman]]ted pursuant to Transfers [[300,1902,2300,1959][12][,I,][Times New Roman]]approved by the City (or constituting Permitted Transfers) and Recorded on the portion of the [[298,1960,1496,2017][12][,I,][Times New Roman]]Property for which the City exercises its rights under this [[1458,1960,1730,2017][12][,I,][Times New Roman]]Section 16.3 [[1705,1960,2300,2017][12][, I,][Times New Roman]]. The Reacquired Property [[300,2017,1040,2074][12][,I,][Times New Roman]]acquired by the City shall be deliver [[1009,2017,2300,2074][12][,I,][Times New Roman]]ed to the City at close of escrow free and clear of all Mortgages [[300,2075,2300,2132][12][,I,][Times New Roman]]including Permitted Mortgages and all other liens, including Construction Liens (other than City [[298,2132,2239,2189][12][,I,][Times New Roman]]Liens and Lien Release Amounts that are actually deducted from the Repurchase Price paid by t [[2202,2132,2300,2189][12][,I,][Times New Roman]]he [[300,2190,2300,2247][12][,I,][Times New Roman]]City), and subject only to (w) the Permitted Exceptions in effect at the time of the original Close [[300,2247,2300,2304][12][,I,][Times New Roman]]of Escrow for such Property, (x) utility easements and/or roadway easements, (y) other matters [[300,2305,1589,2362][12][,I,][Times New Roman]]affecting title consented to or requested by any Governmen [[1564,2305,2300,2362][12][,I,][Times New Roman]]tal Authority with respect to the [[298,2362,2300,2419][12][,I,][Times New Roman]]Property in connection with development of the Property, or requested by the City and any [[300,2420,2300,2477][12][,I,][Times New Roman]]covenants recorded in order to comply with the Entitlements, and (z) the DA and Other Agreements [[300,2477,897,2534][12][,I,][Times New Roman]]recorded in accordance wit [[861,2477,1064,2534][12][,I,][Times New Roman]]h the ter [[1033,2477,1525,2534][12][,I,][Times New Roman]]ms of this Agreement. [[1504,2477,2301,2534][12][,I,][Times New Roman]]Developer acknowledges and agrees [[300,2535,2300,2592][12][,I,][Times New Roman]]that, notwithstanding any other provision of this Agreement, to the extent there is then one or more [[298,2592,1775,2649][12][,I,][Times New Roman]]Permitted Mortgages in effect with respect to the Reacquired Property: [[1770,2592,2300,2649][12][,I,][Times New Roman]](a) the City is obligated [[300,2650,1562,2707][12][,I,][Times New Roman]]to pay the Repurchase Price into escrow in accordance with [[1525,2650,1835,2707][12][,I,][Times New Roman]]Section 16.3.2 [[1814,2650,2300,2707][12][ ,I,][Times New Roman]]for the sole benefit of [[300,2707,2300,2764][12][,I,][Times New Roman]]the Permitted Mortgagee(s) holding such Permitted Mortgage(s), (b) Developer hereby authorizes [[300,2765,1567,2822][12][,I,][Times New Roman]]the City to instruct escrow holder to pay the entirety of the R [[1548,2765,2301,2822][12][,I,][Times New Roman]]epurchase Price to such Permitted [[296,2822,1890,2879][12][,I,][Times New Roman]]Mortgagee(s) unless directed in writing otherwise by Developer and all then [[1865,2822,1915,2879][12][,I,][Times New Roman]]- [[1881,2822,2300,2879][1 2][,I,][Times New Roman]]existing Permitted [[296,2880,2300,2937][12][,I,][Times New Roman]]Mortgagees, and (c) the allocation of Repurchase Price proceeds, if any, by such Permitted [[296,2937,1067,2994][12][,I,][Times New Roman]]Mortgagee(s) to Developer shall be s [[1036,2937,2300,2994][12][,I,][Times New Roman]]olely subject to the terms of any loan documents then in effect Tustin Cornerstone I DDA Form City of Tustin/ ATTACHMENT 12 Memo of DDA (1st Am revised) Att Cornerstone I 6 12 6-11-2017 (agd).docx [[300,300,2300,357][12][,I,][Times New Roman]]between the Permitted Mortgagee(s) and Developer, and City shall have no responsibility to any [[298,357,2300,414][12][,I,][Times New Roman]]Person, including Developer, if Developer shall fail to receive proceeds of the Repurchase Price [[291,415,2300,472][12][,I,][Times New Roman]]for which it might otherwise be entitled under this Agreement, the loan documents or otherwise. [[300,472,2300,529][12][,I,][Times New Roman]]The Developer, on behalf of itself and every Person claiming by, through or under Developer, [[300,530,1658,587][12][,I,][Times New Roman]]hereby waives any and all rights to recover from, and fully and irr [[1627,530,2299,587][12][,I,][Times New Roman]]evocably releases, the City and [[300,587,2300,644][12][,I,][Times New Roman]]its elected and appointed officials, employees, agents, attorneys, affiliates, representatives, [[300,645,2300,702][12][,I,][Times New Roman]]successors and assigns from any and all Claims with respect to (x) the direction provided in [[300,702,472,759][12][,I,][Times New Roman]]Section [[481,702,631,759][12][,I,][Times New Roman]]16.3.2 [[606,702,775,759][12][,I,][Times New Roman]], this [[759,702,1091,759][12][,I,][Times New Roman]]Section 16.3.5 [[1100,702,2301,759][12][,I,][Times New Roman]]or any Subordination Agreement between Permitted [[296,760,2300,817][12][,I,][Times New Roman]]Mortgagee(s) and the City or otherwise, requiring that City direct payment of the Repurchase [[298,817,2300,874][12][,I,][Times New Roman]]Price in its entirety to one or more Permitted Mortgagees, and (y) the delivery of instructions by [[300,875,593,932][12][,I,][Times New Roman]]the City to es [[563,875,2301,932][12][,I,][Times New Roman]]crow and/or the payment, through escrow or otherwise, by the City of the entirety of [[300,932,2300,989][12][,I,][Times New Roman]]the Repurchase Price to such Permitted Mortgagee(s), notwithstanding that Developer may have [[300,990,1923,1047][12][,I,][Times New Roman]]or may assert a claim to all or any portion of such proceeds pursuant to the l [[1887,990,2301,1047][12][,I,][Times New Roman]]oan documents or [[300,1047,523,1104][12][,I,][Times New Roman]]otherwise [[494,1047,544,1104][12][,I,][Times New Roman]]. [[507,1047,557,1104][12][,I,][Times New Roman]]” [[599,1154,1009,1211][12][B,I,][Times New Roman]]Right of Reversion [[450,1155,500,1212][12][,I,][Times New Roman]]“ [[478,1155,591,1212][12][,I,][Times New Roman]]16.4 [[987,1155,1037,1212][12][,I,][Times New Roman]]. [[448,1262,1985,1319][12][,I,][Times New Roman]]In the event of the occurrence of any Reversion Action Trigger (defined in [[1948,1262,2120,1319][12][,I,][Times New Roman]]Section [[2108,1262,2258,1 319][12][,I,][Times New Roman]]16.4.1 [[2227,1262,2283,1319][12][,I,][Times New Roman]]) [[300,1320,2300,1377][12][,I,][Times New Roman]]in addition to its other rights or remedies as a result of the occurrence of any such Reversion [[297,1377,593,1434][12][,I,][Times New Roman]]Action Trigg [[568,1377,2300,1434][12][,I,][Times New Roman]]er, and notwithstanding that the Reacquired Property may be encumbered by [[300,1435,2300,1492][12][,I,][Times New Roman]]Construction Liens and/or Permitted Mortgages, the City shall have the right, during the time [[293,1492,704,1549][12][,I,][Times New Roman]]period set forth in [[664,1492,971,1549][12][,I,][Times New Roman]]Section 16.4.1 [[946,1492,1986,1549][12][,I,][Times New Roman]], on the terms and subject to the conditions set forth [[1972,1492,2143,1549][12][,I,][Times New Roman]]in this [[2104,1492,2301,1549][12][,I,][Times New Roman]]Section [[300,1550,438,1607][12][,I,][Times New Roman]]16.4, [[411,1550,531,1607][12][,I,][Times New Roman]]to re [[502,1550,552,1607][12][,I,][Times New Roman]]- [[519,1550,2300,1607][12][,I,][Times New Roman]]enter and take possession of the applicable Reacquired Property or any portion thereof [[1183,1606,1599,1663][12][B,I,][Times New Roman]]Right of Reversion [[300,1607,1206,1664][12][,I,][Times New Roman]]and to revest title thereto in the City (the “ [[1577,1607,2300,1664][12][,I,][Times New Roman]]”) which right shall be exercised [[300,1665,1170,1722][12][,I,][Times New Roman]]only in accordance with the terms of this [[1133,1665,1407,1722][12][,I,][Times New Roman]]Section 16.4 [[1381,1665,2300,1722][12][,I,][Times New Roman]]. Notwithstanding anything to the contrary [[300,1722,2300,1779][12][,I,][Times New Roman]]contained herein, prior to the Phase 2 Property Close of Escrow, if the Optionee and Phase 1 [[298,1780,2300,1837][12][,I,][Times New Roman]]Developer are Related Parties, the exercise by the City of the Right of Reversion with respect to [[298,1837,520,1894][12][,I,][Times New Roman]]Phase 1 o [[495,1837,1927,1894][12][,I,][Times New Roman]]r any portion thereof shall terminate the Option as further set forth in [[1889,1837,2061,189 4][12][,I,][Times New Roman]]Section [[2049,1837,2199,1894][12][,I,][Times New Roman]]16.4.1 [[2174,1837,2300,1894][12][,I,][Times New Roman]]. In [[300,1895,1895,1952][12][,I,][Times New Roman]]all other cases, the Phase 1 Project and the Phase 2 Project shall not be cross [[1865,1895,1915,1952][12][,I,][Times New Roman]]- [[1881,1895,2300,195 2][12][,I,][Times New Roman]]defaulted with one [[300,1952,1682,2009][12][,I,][Times New Roman]]another hereunder, and the Right of Reversion with respect to al [[1646,1952,2300,2009][12][,I,][Times New Roman]]l or a portion of the Phase 1 [[298,2010,2300,2067][12][,I,][Times New Roman]]Property shall not result in a Right of Reversion with respect to all or a portion of the Phase 2 [[298,2067,2300,2124][12][,I,][Times New Roman]]Property, and vice versa. Any revesting of the Reacquired Property by the City whether based on [[300,2125,983,2182][12][,I,][Times New Roman]]voluntary action of Developer o [[958,2125,2300,2182][12][,I,][Times New Roman]]r otherwise after notice by the City of its intent to exercise the [[1226,2181,1602,2238][12][B,I,][Times New Roman]]Reversion Event [[298,2182,1249,2239][12][,I,][Times New Roman]]Right of Reversion is referred to herein as a “ [[1566,2182,2301,2239][12][,I,][Times New Roman]]” and, for avoidance of doubt, the [[298,2240,2214,2297][12][,I,][Times New Roman]]Reversion Event shall occur on the date upon which fee title to the Reacquired Property vest [[2177,2240,2300,2297][12][,I,][Times New Roman]]s in [[300,2297,2140,2354][12][,I,][Times New Roman]]the City. Subject to the time limitations for exercise of the Right of Reversion set forth in [[2103,2297,2301,2354][12][,I,][Times New Roman]]Section [[300,2355,450,2412][12][,I,][Times New Roman]]16.4.8 [[425,2355,2300,2412][12][,I,][Times New Roman]], the City shall be entitled to exercise the Right of Reversion at any time on or after the [[300,2412,1348,2469][12][,I,][Times New Roman]]occurrence of any of any one or more of the Revers [[1318,2412,2301,2469][12][,I,][Times New Roman]]ion Action Triggers; provided that the City has [[300,2470,1544,2527][12][,I,][Times New Roman]]complied with the conditions to such reversion set forth in [[1510,2470,1682,2527][12][,I,][Times New Roman]]Section [[1669,2470,1819,2527][12][,I,][T imes New Roman]]16.4.2 [[1794,2470,2300,2527][12][,I,][Times New Roman]]. The occurrence of a [[298,2527,1856,2584][12][,I,][Times New Roman]]Revision Action Trigger shall be a Material Default under this Agreement. [[750,2634,1382,2691][12][B,I,][Times New Roman]]Certain Defaults Triggering [[1347,2634,1837,2691][12][B,I,][Times New Roman]]the Right of Reversion [[600,2635,750,2692][12][,I,][Times New Roman]]16.4.1 [[1815,2635,1865,2692][12][,I,][Times New Roman]]. [[1854,2635,2300,2692][12][,I,][Times New Roman]]Except with respect [[300,2692,501,2749][12][,I,][Times New Roman]]to a Non [[476,2692,526,2749][12][,I,][Times New Roman]]- [[490,2692,1460,2749][12][,I,][Times New Roman]]Permitted Foreclosure Event (as described in [[1424,2692,1798,2749][12][,I,][Times New Roman]]Section 16.4.1(k) [[1759,2692,2300,2749][12][,I,][Times New Roman]]), for which the Right of [[298,2750,2300,2807][12][,I,][Times New Roman]]Reversion shall remain in effect with respect to each Phase from the Close of Escrow with respect [[300,2807,677,2864][12][,I,][Times New Roman]]to such Phase un [[652,2807,2300,2864][12][,I,][Times New Roman]]til the issuance by the City of a Certificate of Compliance for such Phase, the [[298,2865,2300,2922][12][,I,][Times New Roman]]Right of Reversion shall remain in effect with respect to each Phase from the Close of Escrow with [[300,2922,1923,2979][12][,I,][Times New Roman]]respect to such Phase until the Equity Completion Date applicable to such Pha [[1898,2922,2300,2979][12][,I,][Times New Roman]]se. Further, prior Tustin Cornerstone I DDA Form City of Tustin/ ATTACHMENT 12 Memo of DDA (1st Am revised) Att Cornerstone I 7 12 6-11-2017 (agd).docx [[300,300,2300,357][12][,I,][Times New Roman]]to the Phase 2 Property Close of Escrow, if the Optionee and Phase 1 Developer are Related [[298,357,2300,414][12][,I,][Times New Roman]]Parties, then upon the exercise by the City of the Right of Reversion with respect to Phase 1 or any [[293,415,1233,472][12][,I,][Times New Roman]]portion thereof the Option and the Phase 2 Pr [[1202,415,2300,472][12][,I,][Times New Roman]]ovisions shall be suspended and upon the occurrence [[300,472,2300,529][12][,I,][Times New Roman]]of the Reversion Event, the Option and the Phase 2 Provisions shall be deemed to have terminated [[300,530,2300,587][12][,I,][Times New Roman]]and to be of no further force or effect (provided that for so long as the Phase 1 Provisions remain [[300,587,450,644][12][,I,][Times New Roman]]in effe [[423,587,2300,644][12][,I,][Times New Roman]]ct and the City shall remain the owner of the Phase 2 Property, the termination of the Phase [[300,645,2300,702][12][,I,][Times New Roman]]2 Provisions shall not affect the obligations of the City under this Agreement, if any, to the Phase [[300,702,1581,759][12][,I,][Times New Roman]]1 Developer with respect to the Phase 2 Property), and the pro [[1556,702,1796,759][12][,I,][Times New Roman]]visions of [[1758,702,2030,759][12][,I,][T imes New Roman]]Section 15.3 [[2017,702,2300,759][12][,I,][Times New Roman]]shall apply. [[298,760,2300,817][12][,I,][Times New Roman]]In all other cases, exercise by the City of the Right of Reversion with respect to a Phase shall not [[300,817,2300,874][12][,I,][Times New Roman]]apply with respect to or affect the rights of the Developer of the other Phase unless the City [[300,875,780,932][12][,I,][Times New Roman]]specifically exercised [[745,875,2300,932][12][,I,][Times New Roman]]the Right of Reversion with respect to such other Phase or portion thereof [[291,932,2300,989][12][,I,][Times New Roman]]following a Reversion Action Trigger with respect to such other Phase. The City may exercise the [[298,990,2007,1047][12][,I,][Times New Roman]]Right of Reversion if it elects to do so with respect to only the Parcel affected by [[1996,990,2300,1047][12][,I,][Times New Roman]]the Material [[298,1047,2300,1104][12][,I,][Times New Roman]]Default and any Improvements thereon and all applicable Entitlements and other development [[300,1105,2300,1162][12][,I,][Times New Roman]]rights, consents, authorizations, variances, waivers, licenses, permits, certificates and approvals [[291,1162,1218,1219][12][,I,][Times New Roman]]from any Governmental Authority or quasi [[1182,1162,1232,1219][12][,I,][Times New Roman]]- [[1199,1162,1482,1219][12][,I,][Times New Roman]]Government [[1445,1162,2300,1219][12][,I,][Times New Roman]]al Authority, and all other appurtenant [[1895,1219,2300,1276][12][B,I,][Times New Roman]]Reversion Action [[300,1220,1918,1277][12][,I,][Times New Roman]]rights applicable thereto upon the occurrence of any of the following (each, a ” [[300,1276,486,1333][12][B,I,][Times New Roman]]Trigger [[456,1277,2300,1334][12][,I,][Times New Roman]],” and the date on which the Reversion Action Trigger occurs shall be referred to herein, [[458,1334,797,1391][12][B,I,][Times New Roman]]Reversion Acti [[760,1334,1119,1391][12][B,I,][Times New Roman]]on Trigger Date [[300,1335,481,1392][12][,I,][Times New Roman]]as the “ [[1091,1335,1169,1392][12][,I,][Times New Roman]]”) [[1135,1335,1185,1392][12][,I,][Times New Roman]]. [[750,1442,841,1499][12][,I,][Times New Roman]](a) [[898,1442,2300,1499][12][,I,][Times New Roman]]Developer fails to (i) commence construction of the Minimum [[298,1500,2300,1557][12][,I,][Times New Roman]]Horizontal Improvements within six (6) months after the Construction Period Commencement [[298,1557,2104,1614][12][,I,][Times New Roman]]Date for the Phase 1 Parcel, or (ii) to Complete the Minimum Horizontal Improvemen [[2079,1557,2301,1614][12][,I,][Times New Roman]]ts (other [[300,1615,1750,1672][12][,I,][Times New Roman]]than the final cap/pave for the roadways on the Property) within twenty [[1722,1615,1772,1672][12][,I,][Times New Roman]]- [[1729,1615,2300,1672][12][, I,][Times New Roman]]four (24) months after the [[300,1672,2300,1729][12][,I,][Times New Roman]]Construction Period Commencement Date for the Phase 1 Parcel, as each such date may be [[300,1730,1043,1787][12][,I,][Times New Roman]]extended for Force Majeure Delay; [[750,1837,841,1894][12][,I,][Times New Roman]](b) [[898,1837,1370,1894][12][,I,][Times New Roman]]Developer fails to com [[1356,1837,2241,1894][12][,I,][Times New Roman]]mence construction of the Minimum Phase [[2225,1837,2275,1894][12][,I,][Times New Roman]]1 [[300,1895,2300,1952][12][,I,][Times New Roman]]Vertical Improvements within twelve (12) months after the Construction Period Commencement [[298,1952,2060,2009][12][,I,][Times New Roman]]Date for the Phase 1 Parcel, as such date may be extended for Force Majeure Delay; [[750,2060,839,2117][12][,I,][Times New Roman]](c) [[898,2060,1660,2117][12][,I,][Times New Roman]]Developer fails to commence constru [[1635,2060,2300,2117][12][,I,][Times New Roman]]ction of the Phase 2 Horizontal [[298,2117,2300,2174][12][,I,][Times New Roman]]Improvements within six (6) months after the Construction Period Commencement Date for the [[298,2175,1776,2232][12][,I,][Times New Roman]]Phase 2 Parcel as such date may be extended for Force Majeure Delay. [[750,2282,841,2339][12][,I,][Times New Roman]](d) [[898,2282,2221,2339][12][,I,][Times New Roman]]Developer fails to commence construction of the Minimum Phas [[2190,2282,2240,2339][12][,I,][Times New Roman]]e [[2225,2282,2275,2339][12][,I,][Times New Roman]]2 [[300,2340,2300,2397][12][,I,][Times New Roman]]Vertical Improvements within twelve (12) months after the Construction Period Commencement [[298,2397,2044,2454][12][,I,][Times New Roman]]Date for the Phase 2 Parcel, as such date may be extended for Force Majeure Delay; [[750,2505,839,2562][12][,I,][Times New Roman]](e) [[898,2505,2300,2562][12][,I,][Times New Roman]]Developer fails to Complete construction (i) of the Minimum Phase [[300,2562,512,2619][12][,I,][Times New Roman]]1 Vertic [[484,2562,1164,2619][12][,I,][Times New Roman]]al Improvements within forty [[1135,2562,1185,2619][12][,I,][Times New Roman]]- [[1151,2562,2300,2619][12][,I,][Times New Roman]]eight (48) months after the Construction Period [[300,2620,2300,2677][12][,I,][Times New Roman]]Commencement Date for the Phase 1 Parcel as such date may be extended for Force Majeure [[298,2677,1800,2734][12][,I,][Times New Roman]]Delay or (ii) of the Minimum Phase 2 Vertical Improvements within forty [[1771,2677,1821,2734][12][,I,][Times New Roman]]- [[1788,2677,2204,2734][12][, I,][Times New Roman]]eight (48) months a [[2171,2677,2300,2734][12][,I,][Times New Roman]]fter [[300,2735,2300,2792][12][,I,][Times New Roman]]the Construction Period Commencement Date for the Phase 2 Parcel as such date may be extended [[291,2792,2300,2849][12][,I,][Times New Roman]]for Force Majeure Delay; provided that in each case, such Completion date shall not under any [[300,2850,1590,2907][12][,I,][Times New Roman]]circumstances be later than the date that is sixty (60) months [[1555,2850,2301,2907][12][,I,][Times New Roman]]after the Close of Escrow for such [[298,2907,1716,2964][12][,I,][Times New Roman]]Parcel (which date shall not be extended for Force Majeure Delay); Tustin Cornerstone I DDA Form City of Tustin/ ATTACHMENT 12 Memo of DDA (1st Am revised) Att Cornerstone I 8 12 6-11-2017 (agd).docx [[750,300,830,357][12][,I,][Times New Roman]](f) [[898,300,2300,357][12][,I,][Times New Roman]]Developer commits physical waste on the Property or any portion [[300,357,2116,414][12][,I,][Times New Roman]]thereof and such becomes a Material Default in accordance with the notice and cure pr [[2085,357,2300,414][12][,I,][Times New Roman]]ovisions [[300,415,389,472][12][,I,][Times New Roman]]of [[352,415,624,472][12][,I,][Times New Roman]]Section 14.2 [[599,415,1585,472][12][,I,][Times New Roman]], subject to extension for Force Majeure Delay; [[750,523,841,580][12][,I,][Times New Roman]](g) [[898,523,2300,580][12][,I,][Times New Roman]]Developer abandons or substantially suspends (except for [[300,580,2300,637][12][,I,][Times New Roman]]suspensions resulting from Force Majeure Delay) construction of the Phase 1 Project or the Phase [[300,637,840,694][12][,I,][Times New Roman]]2 Project, as applicable, [[793,637,2300,694][12][,I,][Times New Roman]]for a period of one hundred eighty (180) consecutive calendar days, and [[300,695,2136,752][12][,I,][Times New Roman]]such becomes a Material Default in accordance with the notice and cure provisions of [[2103,695,2299,752][12][,I,][Times New Roman]]Section [[300,753,413,810][12][,I,][Times New Roman]]14.2 [[388,753,779,810][12][,I,][Times New Roman]]. Nothing in this [[743,753,1120,810][12][,I,][Times New Roman]]Section 16.4.1(g) [[1100,753,1645,810] [12][,I,][Times New Roman]]shall extend the terms of [[1609,753,2100,810][12][,I,][Times New Roman]]Section 16.4.1(a), (b), [[2064,753,2283,810][12][,I,][Times New Roman]](c) or (d) [[300,810,469,867][12][,I,][Times New Roman]]above; [[750,917,841,974][12][,I,][Times New Roman]](h) [[900,917,1998,974][12][,I,][Times New Roman]]The occurrence of a Developer Insolvency Event; or [[750,1025,830,1082][12][,I,][Times New Roman]](i) [[900,1025,2300,1082][12][,I,][Times New Roman]]With respect to any Guarantor which has provided a Guaranty to [[300,1082,2300,1139][12][,I,][Times New Roman]]the City, the occurrence of a Guarantor Illiquidity Event or a City Guarantor Illiquidity Event, [[300,1140,2300,1197][12][,I,][Times New Roman]]unless Developer shall, within the time period required thereby, provide substitute security [[300,1197,408,1254][12][,I,][Times New Roman]]mee [[380,1197,910,1254][12][,I,][Times New Roman]]ting the requirements of [[872,1197,1044,1254][12][,I,][Times New Roman]]Section [[1032,1197,1120,12 54][12][,I,][Times New Roman]]4.7 [[1094,1197,1144,1254][12][,I,][Times New Roman]]; [[750,1305,830,1362][12][,I,][Times New Roman]](j) [[896,1305,2300,1362][12][,I,][Times New Roman]]Material Default arises because of as to any Phase, (i) a voluntary [[300,1362,2300,1419][12][,I,][Times New Roman]]or involuntary Transfer prior to the Equity Completion Date for such Phase, or (ii) after the Equity [[300,1420,1120,1477][12][,I,][Times New Roman]]Completion Date for such Phase, a Non [[1095,1420,1145,1477][12][,I,][Times New Roman]]- [[1110,1420,1298,1477][12][,I,][Times New Roman]]Permitt [[1262,1420,2262,1477][12][,I,][Times New Roman]]ed Foreclosure Event with respect to such Phase [[2233,1420,2283,1477][12][,I,][Times New Roman]]; [[300,1477,375,1534][12][,I,][Times New Roman]]or [[750,1585,839,1642][12][,I,][Times New Roman]](k) [[900,1585,2258,1642][12][,I,][Times New Roman]]a Material Default arises because of the occurrence of a Non [[2233,1585,2283,1642][12][,I,][Times New Roman]]- [[298,1642,2300,1699][12][,I,][Times New Roman]]Permitted Foreclosure Event with respect to a Phase at any time prior to the issuance of a [[300,1700,1191,1757][12][,I,][Times New Roman]]Certificate of Compliance for such Phase.” [[750,1806,1749,1863][12][B,I,][Times New Roman]]Conditions to Exercise of the Right of Reversion [[600,1807,738,1864][12][,I,][Times New Roman]]16.4. [[700,1807,750,1864][12][,I,][Times New Roman]]2 [[1727,1807,1777,1864][12][,I,][Times New Roman]]. [[1759,1807,2301,1864][12][,I,][Times New Roman]]The City shall be entitled [[300,1865,2300,1922][12][,I,][Times New Roman]]to exercise the Right of Reversion at any time on or after the applicable Reversion Action Trigger [[298,1922,1958,1979][12][,I,][Times New Roman]]Date by providing written notice to Developer and any Permitted Mortgagee who [[1933,1922,2301,1979][12][,I,][Times New Roman]]se address is on [[291,1980,1316,2037][12][,I,][Times New Roman]]file in the Official Records (as described in [[1294,1980,1581,2037][12][,I,][Times New Roman]]Section 18.6 [[1550,1980,2062,2037][12][,I,][Times New Roman]]), or following a Non [[2037,1980,2087,2037][12][,I,][Times New Roman]]- [[2052,1980,2301,2037][12][,I,][Times New Roman]]Permitted [[298,2037,2300,2094][12][,I,][Times New Roman]]Foreclosure Event, by providing notice to the Foreclosure Transferee that the City elects to [[300,2095,1457,2152][12][,I,][Times New Roman]]exercise its Right of Reversion, which notice shall stat [[1422,2095,2164,2152][12][,I,][Times New Roman]]e the date for the Reversion Event [[2128,2095,2178,2152][12][,I,][Times New Roman]]. [[2175,2095,2300,2152][12][,I,][Times New Roman]]The [[298,2152,2300,2209][12][,I,][Times New Roman]]Reversion Event shall not take place until the earlier of (a) the date that is thirty (30) calendar [[300,2210,2300,2267][12][,I,][Times New Roman]]days after Developer has had the opportunity to address the City Council at a public meeting [[300,2267,789,2324][12][,I,][Times New Roman]]regarding the Reversio [[764,2267,2300,2324][12][,I,][Times New Roman]]n Action Trigger or (b) if there is a Permitted Mortgage encumbering the [[298,2325,1446,2382][12][,I,][Times New Roman]]Parcel, the expiration of the time period set forth in [[1416,2325,1588,2382][12][,I,][Times New Roman]]Section [[1575,2325,1725,2382][12][,I,][Times New Roman]]17.6.3 [[1710,2325,2300,2382][12][,I,][Times New Roman]]for cure by the Permitted [[296,2382,2063,2439][12][,I,][Times New Roman]]Mortgage of any Default resulting from a Reversion Action Trigger. In the event that, [[2017,2382,2300,2439][12][,I,][Times New Roman]]prior to the [[298,2440,2300,2497][12][,I,][Times New Roman]]Reversion Event, Developer, any Permitted Mortgagee with respect to the portion of the Property [[300,2497,2300,2554][12][,I,][Times New Roman]]to which the Right of Reversion is applicable or any other Person on behalf of Developer either [[300,2555,389,2612][12][,I,][Times New Roman]](x) [[367,2555,1383,2612][12][,I,][Times New Roman]]cures the Reversion Action Trigger which is the [[1373,2555,2300,2612][12][,I,][Times New Roman]]basis for the City’s exercise of its Right of [[298,2613,657,2670][12][,I,][Times New Roman]]Reversion or (y) [[636,2613,2301,2670][12][,I,][Times New Roman]]Completes the Phase 1 Project or the Phase 2 Project, as applicable, prior to the [[300,2670,2300,2727][12][,I,][Times New Roman]]date of the Reversion Event, such Right of Reversion shall cease and terminate with respect to [[300,2728,654,2785][12][,I,][Times New Roman]]such Reversion [[614,2728,1062,2785][12][,I,][Times New Roman]]Action Trigger only. Tustin Cornerstone I DDA Form City of Tustin/ ATTACHMENT 12 Memo of DDA (1st Am revised) Att Cornerstone I 9 12 6-11-2017 (agd).docx [[749,299,1630,356][12][B,I,][Times New Roman]]Exercise and Effect of Right of Reversion [[600,300,750,357][12][,I,][Times New Roman]]16.4.3 [[1609,300,1659,357][12][,I,][Times New Roman]]. [[750,407,841,464][12][,I,][Times New Roman]](a) [[900,407,1178,464][12][,I,][Times New Roman]]Cooperation [[1153,407,2300,464][12][,I,][Times New Roman]]. If the City exercises its Right of Reversion in [[300,465,2300,522][12][,I,][Times New Roman]]accordance with the provisions of this Agreement, Developer and each Permitted Mortgagee shall [[300,523,780,580][12][,I,][Times New Roman]]use all reasonable effo [[755,523,2301,580][12][,I,][Times New Roman]]rts to take, or cause to be taken, all actions and to do, or cause to be done, [[300,580,2300,637][12][,I,][Times New Roman]]all things necessary or desirable under applicable law to consummate the revesting of the [[298,637,2108,694][12][,I,][Times New Roman]]Reacquired Property in the name of the City, including the execution and delivery of su [[2083,637,2301,694][12][,I,][Times New Roman]]ch other [[300,695,2300,752][12][,I,][Times New Roman]]documents, certificates, agreements, deeds and other writings and the taking of such other actions [[300,752,2300,809][12][,I,][Times New Roman]]as may be reasonably necessary to consummate such revesting and the other provisions of this [[300,810,572,867][12][,I,][Times New Roman]]Section 16.4 [[547,810,597,867][12][,I,][Times New Roman]]. [[750,917,841,974][12][,I,][Times New Roman]](b) [[898,917,1690,974][12][,I,][Times New Roman]]Effect on Mortgages other than [[1679,917,2301,974][12][,I,][Times New Roman]]Permitted Mortgages and [[300,975,714,1032][12][,I,][Times New Roman]]Construction Liens [[683,975,2300,1032][12][,I,][Times New Roman]]. A Reversion Event shall foreclose, defeat and render invalid each and every [[300,1032,2300,1089][12][,I,][Times New Roman]]Construction Lien and Mortgage other than a Permitted Mortgage and upon the occurrence of a [[298,1090,1217,1147][12][,I,][Times New Roman]]Reversion Event all Construction Liens and [[1174,1090,2300,1147][12][,I,][Times New Roman]]Mortgages other than Permitted Mortgages Recorded [[300,1147,2300,1204][12][,I,][Times New Roman]]against or affecting all or any portion of the Reacquired Property shall be deemed to be [[300,1205,2287,1262][12][,I,][Times New Roman]]automatically released and of no further force and effect with respect to the Reacquired Property. [[750,1312,839,1369][12][,I,][Times New Roman]](c) [[898,1312,1233,1369][12][,I,][Times New Roman]]Effect on Perm [[1219,1312,1578,1369][12][,I,][Times New Roman]]itted Mortgages [[1547,1312,2300,136 9][12][,I,][Times New Roman]]. Concurrent with the Reversion [[298,1370,2300,1427][12][,I,][Times New Roman]]Event, the City shall fully satisfy each and every Permitted Mortgage affecting the Reacquired [[1724,1426,1927,1483][12][B,I,][Times New Roman]]lesser of [[298,1427,1763,1484][12][,I,][Times New Roman]]Property, by paying to the Permitted Mortgagees, in the aggregate, the [[1906,1427,2300,1484][12][,I,][Times New Roman]](a) the aggregate [[298,1485,650,1542][12][,I,][Times New Roman]]Permitted Mort [[611,1485,2300,1542][12][,I,][Times New Roman]]gage Unpaid Balances of all Permitted Mortgages and (b) Two Million Dollars [[300,1542,2300,1599][12][,I,][Times New Roman]]($2,000,000) per Phase, which amount has been determined to be a reasonable estimation of the [[300,1600,2181,1657][12][,I,][Times New Roman]]advances, costs and expenses incurred or to be incurred by the Permitted Mortgagees, i [[2145,1600,2301,1657][12][,I,][Times New Roman]]n the [[300,1657,2300,1714][12][,I,][Times New Roman]]aggregate, for each Phase prior to the Equity Completion Date for such Phase, or by causing such [[300,1715,1643,1772][12][,I,][Times New Roman]]amounts to be paid by any third party, including any guarantor. [[750,1822,841,1879][12][,I,][Times New Roman]](d) [[898,1822,1180,1879][12][,I,][Times New Roman]]Interpleader [[1150,1822,2301,1879][12][,I,][Times New Roman]]. The City shall have the right to satisfy its obligation [[293,1880,580,1937][12][,I,][Times New Roman]]pursuant to [[542,1880,916,1937][12][,I,][Times New Roman]]Section 16.4.3(c) [[895,1880,2301,1937][12][,I,][Times New Roman]]by either interpleading, or causing any third party on City’s behalf, [[300,1937,2300,1994][12][,I,][Times New Roman]]including Guarantor, to interplead in a court of law the sums due and thereafter City and the [[298,1995,1850,2052][12][,I,][Times New Roman]]Reacquired Property shall be deemed released from and the City shall be re [[1822,1995,2301,2052][12][,I,][Times New Roman]]leased from and have [[300,2052,2300,2109][12][,I,][Times New Roman]]no further liability with respect to any Permitted Mortgagee of the Reacquired Property or [[298,2110,1550,2167][12][,I,][Times New Roman]]Permitted Mortgage encumbering the Reacquired Property. [[750,2217,839,2274][12][,I,][Times New Roman]](e) [[898,2217,1052,2274][12][,I,][Times New Roman]]Effect [[1016,2217,2300,2274][12][,I,][Times New Roman]]. If the City pays or interpleads the amount specified in [[300,2275,674,2332][12][,I,][Times New Roman]]Section 16.4.3(c) [[641,2275,691,2332][12][,I,][Times New Roman]], [[667,2275,2300,2332][12][,I,][Times New Roman]]concurrently with the Reversion Event and the deposit of such amount with the [[300,2332,2300,2389][12][,I,][Times New Roman]]court or payment of such amount to Permitted Mortgagee, (1) the Reversion Event shall foreclose, [[300,2390,2148,2447][12][,I,][Times New Roman]]defeat and render invalid each and every Permitted Mortgage encumbering the Reac [[2120,2390,2300,2447][12][,I,][Times New Roman]]quired [[298,2447,2300,2504][12][,I,][Times New Roman]]Property and upon the occurrence of a Reversion Event all Permitted Mortgages Recorded against [[300,2505,2300,2562][12][,I,][Times New Roman]]or encumbering all or any portion of the Reacquired Property shall be deemed to be automatically [[300,2563,1531,2620][12][,I,][Times New Roman]]released and of no further force and effect with respect [[1502,2563,2300,2620][12][,I,][Times New Roman]]to the Reacquired Property and (2) [[293,2620,2300,2677][12][,I,][Times New Roman]]promptly thereafter, each Permitted Mortgagee shall take all steps individually and collectively [[300,2678,2300,2735][12][,I,][Times New Roman]]required to Record evidence of such release and termination with respect to each Permitted [[296,2735,1041,2792][12][,I,][Times New Roman]]Mortgage encumbering all or any p [[1016,2735,1746,2792][12][,I,][Times New Roman]]ortion of the Reacquired Property. [[749,2841,1363,2898][12][B,I,][Times New Roman]]Sale of Reacquired Property [[600,2842,750,2899][12][,I,][Times New Roman]]16.4.4 [[1335,2842,2301,2899][12][,I,][Times New Roman]]. Upon the revesting in the City of title to the [[298,2900,2300,2957][12][,I,][Times New Roman]]Reacquired Property, the City shall use commercially reasonable efforts to resell the Reacquired Tustin Cornerstone I DDA Form City of Tustin/ ATTACHMENT 12 Memo of DDA (1st Am revised) Att Cornerstone I 10 12 6-11-2017 (agd).docx [[298,300,1157,357][12][,I,][Times New Roman]]Property as soon and in such manner as t [[1120,300,2300,357][12][,I,][Times New Roman]]he City shall find feasible, in accordance with applicable [[300,357,2300,414][12][,I,][Times New Roman]]State law, if any, and consistent with the objectives of this Agreement, to a qualified and [[300,415,2300,472][12][,I,][Times New Roman]]responsible Person or Persons (as determined by the City in its sole discretion). Upon such resale [[300,472,423,529][12][,I,][Times New Roman]]of th [[398,472,2300,529][12][,I,][Times New Roman]]e Reacquired Property, or any part thereof, the proceeds thereof shall be applied in the [[291,530,2300,587][12][,I,][Times New Roman]]following order and amounts to the extent of funds available and the City shall have no liability to [[298,587,1633,644][12][,I,][Times New Roman]]Developer or any Person to the extent the balance is insufficient [[1595,587,2300,644][12][,I,][Times New Roman]]to pay any or all of the following [[300,645,2300,702][12][,I,][Times New Roman]]amounts nor shall the City have any obligation to make payments to any Person except in [[300,702,1590,759][12][,I,][Times New Roman]]accordance with the priorities and obligations set forth below: [[750,810,841,867][12][,I,][Times New Roman]](a) [[898,810,1216,867][12][,I,][Times New Roman]]Delinquencies [[1186,810,2181,867][12][,I,][Times New Roman]]. First, to repayment in full of all delinquent tax [[2165,810,2265,867][12][,I,][Times New Roman]]and [[300,867,2098,924][12][,I,][Times New Roman]]delinquent assessment liens with respect to the portion of the Reacquired Property sold; [[750,975,841,1032][12][,I,][Times New Roman]](b) [[900,975,1135,1032][12][,I,][Times New Roman]]City Liens [[1105,975,2162,1032][12][,I,][Times New Roman]]. Second, to repayment in full of City Liens and to [[300,1032,2119,1089][12][,I,][Times New Roman]]reimburse the City for all costs and expenses incurred by the City in connection with the [[300,1090,439,1147][12][,I,][Times New Roman]]recap [[413,1090,2298,1147][12][,I,][Times New Roman]]ture, management, maintenance, repair, and resale of the Reacquired Property, or any part [[300,1147,2207,1204][12][,I,][Times New Roman]]thereof and the enforcement of City’s rights under this Agreement and the Other Agreements [[300,1205,1801,1262][12][,I,][Times New Roman]]including City’s exercise of the Right of Reversion, taxes, assessments, an [[1776,1205,2193,1262][12][,I,][Times New Roman]]d other delinquent [[300,1262,2132,1319][12][,I,][Times New Roman]]liens, if any, whether arising before or after the acquisition by the City of the Reacquired [[298,1320,528,1377][12][,I,][Times New Roman]]Property. [[750,1427,839,1484][12][,I,][Times New Roman]](c) [[898,1427,1258,1484][12][,I,][Times New Roman]]Release of Liens [[1228,1427,2129,1484][12][,I,][Times New Roman]]. Third, to release all Claims affecting the [[298,1485,1741,1542][12][,I,][Times New Roman]]Reacquired Property, including Claims asserted with respect to Const [[1705,1485,2166,1542][12][,I,][Times New Roman]]ruction Liens and/or [[296,1542,2124,1599][12][,I,][Times New Roman]]Mortgages, in such amounts as may be determined by the City in its sole discretion to be [[300,1600,2186,1657][12][,I,][Times New Roman]]required to satisfy such Claims or to reinstate service or work on the Reacquired Property, [[300,1657,1396,1714][12][,I,][Times New Roman]]utility charges with respect to the Reacquired Proper [[1365,1657,2252,1714][12][,I,][Times New Roman]]ty; any payments made or necessary to be [[300,1715,2226,1772][12][,I,][Times New Roman]]made to discharge or prevent from attaching or being made any subsequent encumbrances or [[300,1772,2189,1829][12][,I,][Times New Roman]]liens due to obligations, Defaults or acts of Developer or any Successor Owner or each and [[300,1830,1056,1887][12][,I,][Times New Roman]]every Person claiming by, through o [[1031,1830,2054,1887][12][,I,][Times New Roman]]r under Developer or any Successor Owner; any [[300,1887,2162,1944][12][,I,][Times New Roman]]expenditures made or obligations incurred with respect to the making or completion of the [[300,1945,2170,2002][12][,I,][Times New Roman]]agreed improvements or any part thereof on the Reacquired Property; all costs of sale and [[300,2002,966,2059][12][,I,][Times New Roman]]marketing, including reasonabl [[929,2002,2230,2059][12][,I,][Times New Roman]]e brokers’ fees and costs incurred in the marketing and sale of [[300,2060,2193,2117][12][,I,][Times New Roman]]the Reacquired Property; all legal fees and expenses; all escrow and title fees and costs; all [[300,2117,2214,2174][12][,I,][Times New Roman]]survey and due diligence fees and costs; and any amounts otherwise owing to the City or any [[300,2175,423,2232][12][,I,][Times New Roman]]third [[403,2175,2212,2232][12][,I,][Times New Roman]]party by Developer and/or any Successor Owner) with respect to the foregoing, in each [[300,2232,2164,2289][12][,I,][Times New Roman]]case (x) whether arising prior to or following the acquisition by the City of the Reacquired [[298,2290,1796,2347][12][,I,][Times New Roman]]Property and (y) only to the extent that the foregoing are not fully foreclo [[1771,2290,2292,2347][12][,I,][Times New Roman]]sed or other terminated [[300,2347,1744,2404][12][,I,][Times New Roman]]by or as a result of the exercise by the City of the Right of Reversion; [[750,2455,841,2512][12][,I,][Times New Roman]](d) [[898,2455,1513,2512][12][,I,][Times New Roman]]Reimbursement to Developer [[1483,2455,2261,2512][12][,I,][Times New Roman]]. Fourth, to reimburse Developer in [[300,2512,2121,2569][12][,I,][Times New Roman]]the amount of the Repurchase Price as determined in clause (a) of the definition thereof, [[2084,2512,2229,2569][12][,I,][Times New Roman]]after [[300,2570,2198,2627][12][,I,][Times New Roman]]deducting therefrom: (i) all amounts paid to Permitted Mortgagees or interplead by the City [[293,2627,580,2684][12][,I,][Times New Roman]]pursuant to [[542,2627,714,2684][12][,I,][Times New Roman]]Section [[702,2627,916,2684][12][,I,][Times New Roman]]16.4.3(c) [[894,2627,1684,2684][12][, I,][Times New Roman]]and (ii) all amounts paid pursuant to [[1647,2627,2135,2684][12][,I,][Times New Roman]]Section 16.4.4(a), (b), [[300,2685,400,2742][12][,I,][Times New Roman]]and [[388,2685,477,2742][12][,I,][Times New Roman]](c) [[442,2685,1641,2742][12][,I,][Times New Roman]], in each case to the extent such amounts are not already d [[1616,2685,2271,2742][12][,I,][Times New Roman]]educted as part of the formula [[300,2742,1198,2799][12][,I,][Times New Roman]]in clause (a) of the Repurchase Price; and [[750,2850,839,2907][12][,I,][Times New Roman]](e) [[898,2850,1511,2907][12][,I,][Times New Roman]]Balance Retained by the City [[1484,2850,2249,2907][12][,I,][Times New Roman]]. Any balance remaining after such [[300,2907,1549,2964][12][,I,][Times New Roman]]reimbursements shall be retained by the City as its property. Tustin Cornerstone I DDA Form City of Tustin/ ATTACHMENT 12 Memo of DDA (1st Am revised) Att Cornerstone I 11 12 6-11-2017 (agd).docx [[300,300,1343,357][12][,I,][Times New Roman]]The City shall have the right to satisfy its obliga [[1318,300,1791,357][12][,I,][Times New Roman]]tion pursuant to this [[1759,300,2074,357][12][,I,][T imes New Roman]]Section 16.4.4 [[2068,300,2301,357][12][,I,][Times New Roman]]by either [[300,357,2300,414][12][,I,][Times New Roman]]interpleading, or causing any third party on City’s behalf, including purchaser, to interplead in a [[300,415,2300,472][12][,I,][Times New Roman]]court of law the sums due. Upon sale of the Reacquired Property and distribution of the proceeds [[300,472,555,529][12][,I,][Times New Roman]]of such sal [[519,472,2300,529][12][,I,][Times New Roman]]e in accordance with the foregoing or interpleader of proceeds as aforesaid, the City [[300,530,2300,587][12][,I,][Times New Roman]]shall be released from all liability and obligations under this Agreement and/or the Other [[297,587,1412,644][12][,I,][Times New Roman]]Agreements with respect to the Reacquired Property. [[749,694,1164,751][12][B,I,][Times New Roman]]Release of Liabilit [[1124,694,1179,751][12][B,I,][Times New Roman]]y [[600,695,750,752][12][,I,][Times New Roman]]16.4.5 [[1150,695,2299,752][12][,I,][Times New Roman]]. In the event the City exercises its Right of Reversion [[300,753,2123,810][12][,I,][Times New Roman]]then upon the occurrence of the Reversion Event and compliance with the requirements of [[2083,753,2300,810][12][,I,][Times New Roman]]Sections [[300,810,450,867][12][,I,][Times New Roman]]16.4.3 [[425,810,2300,867][12][,I,][Times New Roman]], the City and the Developer owning the Reacquired Property shall each be released from [[300,867,2300,924][12][,I,][Times New Roman]]all liability and obligations under this Agreement and the Other Agreements with respect to the [[298,925,1778,982][12][,I,][Times New Roman]]Reacquired Property except for (a) the obligation of the City to comply [[1740,925,1877,982][12][,I,][Times New Roman]]with [[1840,925,2150,982][12][,I ,][Times New Roman]]Section 16.4.4 [[2125,925,2301,982][12][,I,][Times New Roman]]. upon [[300,982,2300,1039][12][,I,][Times New Roman]]sale of the Reacquired Property and (b) the following obligations of Developer, from which [[298,1040,2300,1097][12][,I,][Times New Roman]]Developer shall not be released and which in addition shall continue to be “Guaranteed [[300,1097,1395,1154][12][,I,][Times New Roman]]Obligations” as such term is defined in each Guarant [[1354,1097,2300,1154][12][,I,][Times New Roman]]y provided in connection with the acquisition [[300,1155,1308,1212][12][,I,][Times New Roman]]of the Reacquired Property by Developer: (a) [[1287,1155,2300,1212][12][,I,][Times New Roman]]Ongoing Matters and any other obligations of [[298,1212,1580,1269][12][,I,][Times New Roman]]Developer that are addressed by the terms of the Guaranty; (b) [[1559,1212,2300,1269][12][,I,][Times New Roman]]the release provided for the benefit [[300,1270,726,1327][12][,I,][Times New Roman]]of the City pursuan [[701,1270,821,1327][12][,I,][Times New Roman]]t to [[789,1270,1134,1327][12][,I,][Times New Roman]]Section 4.5.2(f) [[1101,1270,1224,1327][12][,I,][Times New Roman]]; (c) [[1203,1270,2300,1327][12][,I,][Times New Roman]]the obligation to return any written Due Diligence [[298,1327,1129,1384][12][,I,][Times New Roman]]Information to the City as provided in [[1095,1327,1370,1384][12][,I,][Times New Roman]]Section 14.3 [[1344,1327,1468,1384][12][,I,][Times New Roman]]; (d) [[1448,1327,2301,1384][12][,I,][Times New Roman]]the obligation to indemnify, defend and [[300,1385,1499,1442][12][,I,][Times New Roman]]hold harmless the City Indemnified Parties as provided in [[1458,1385,1684,1442][12][,I,][Times New Roman]]Article 10 [[1660,1385,1938,1442][12][,I,][ Times New Roman]]for matters [[1900,1385,2300,1442][12][,I,][Times New Roman]]arising or related [[300,1442,2300,1499][12][,I,][Times New Roman]]to the period of time prior to the conveyance of the Reacquired Property to the City; [[300,1500,389,1557][12][,I,][Times New Roman]](e) [[365,1500,2300,1557][12][,I,][Times New Roman]]Developer’s obligation to indemnify, defend and hold harmless the City Indemnified Parties as [[293,1557,577,1614][12][,I,][Times New Roman]]provided in [[538,1557,783,1614][12][,I,][Times New Roman]]Section 5.5 [[768,1557,1356,1614][12][,I,][Times New Roman]]as to a Parcel for matters ar [[1325,1557,2300,1614][12][,I,][Times New Roman]]ising or related to the period prior to the Close [[300,1615,2300,1672][12][,I,][Times New Roman]]of Escrow for such Parcel, and such liability and obligations shall survive the close of escrow and [[300,1672,2300,1729][12][,I,][Times New Roman]]shall not be merged into the quitclaim deed, it being acknowledged and agreed that all other [[300,1730,576,1787][12][,I,][Times New Roman]]obligations [[549,1730,2300,1787][12][,I,][Times New Roman]]under this Agreement related to the Reacquired Property shall be released and [[300,1787,2300,1844][12][,I,][Times New Roman]]terminated as of the date on which the Required Property is conveyed to the City. In no event shall [[300,1845,1906,1902][12][,I,][Times New Roman]]the Guaranty provided at the Close of Escrow for the relevant phase (or any G [[1892,1845,2300,1902][12][,I,][Times New Roman]]uaranty approved [[300,1902,2300,1959][12][,I,][Times New Roman]]by the City in its sole discretion as a replacement for such original Guaranty) to secure the [[300,1960,2300,2017][12][,I,][Times New Roman]]obligations of Developer under the DDA and the Other Agreements with respect to the portion of [[300,2017,1412,2074][12][,I,][Times New Roman]]the Property containing the Reacquired Property be [[1403,2017,2301,2074][12][,I,][Times New Roman]]released or terminated as a result of the [[300,2075,2300,2132][12][,I,][Times New Roman]]exercise by the City of the Right of Reversion. Following the close of escrow with respect to the [[298,2132,2300,2189][12][,I,][Times New Roman]]Reacquired Property, under no circumstances shall Developer or any Permitted Mortgagee have [[300,2190,770,2247][12][,I,][Times New Roman]]any right or claim to, [[747,2190,2300,2247][12][,I,][Times New Roman]]or against, the Reacquired Property. Notwithstanding the revesting of the [[298,2247,1392,2304][12][,I,][Times New Roman]]Reacquired Property by the City as provided in this [[1355,2247,1628,2304][12][,I,][Times New Roman]]Section 16.4 [[1603,2247,2300,2304][12][,I,][Time s New Roman]], this Agreement shall remain in [[291,2305,1931,2362][12][,I,][Times New Roman]]full force and effect with respect to the portions of the Property not revested by [[1893,2305,2113,2362][12][,I,][Times New Roman]]the City. [[749,2411,1294,2468][12][B,I,][Times New Roman]]Rights of Third Parties [[600,2412,750,2469][12][,I,][Times New Roman]]16.4.6 [[1263,2412,2300,2469][12][,I,][Times New Roman]]. The Right of Reversion shall be a lien and [[300,2470,2300,2527][12][,I,][Times New Roman]]encumbrance on the Property that shall be paramount to the lien and charge of (a) any Mortgage [[300,2527,1837,2584][12][,I,][Times New Roman]]upon the Parcels or Improvements, except that with respect to a lien that i [[1801,2527,2300,2584][12][,I,][Times New Roman]]s a Construction Loan [[300,2585,2300,2642][12][,I,][Times New Roman]]secured by a Permitted Mortgage, the implementation of the Right of Reversion shall be subject to [[300,2642,2300,2699][12][,I,][Times New Roman]]the terms of the Subordination Agreement, if any, and (b) all other liens including Construction [[298,2700,1174,2757][12][,I,][Times New Roman]]Liens that may attach to the Developmen [[1149,2700,2300,2757][12][,I,][Times New Roman]]t Parcels or the Improvements thereon. The Right of [[298,2758,2300,2815][12][,I,][Times New Roman]]Reversion shall not defeat or render invalid or limit any rights or interests provided in easements, [[300,2815,2300,2872][12][,I,][Times New Roman]]covenants, conditions or restrictions in favor of third parties (i.e., Persons other than Developer [[300,2873,375,2930][12][,I,][Times New Roman]]or [[364,2873,2300,2930][12][,I,][Times New Roman]]Developer Affiliates) granted pursuant to Transfers approved by the City (or constituting [[298,2930,2300,2987][12][,I,][Times New Roman]]Permitted Transfers) and Recorded on the portion of the Property for which the City exercises its Tustin Cornerstone I DDA Form City of Tustin/ ATTACHMENT 12 Memo of DDA (1st Am revised) Att Cornerstone I 12 12 6-11-2017 (agd).docx [[300,300,682,357][12][,I,][Times New Roman]]rights under this [[645,300,917,357][12][,I,][Times New Roman]]Section 16.4 [[892,300,1673,357][12][,I,][Times New Roman]]. The Reacquired Property shall be d [[1648,300,2300,357][12][,I,][Times New Roman]]elivered to the City at close of [[300,357,2005,414][12][,I,][Times New Roman]]escrow free and clear of (a) all Mortgages that are not Permitted Mortgages, (b) [[1983,357,2300,414][12][,I,][Times New Roman]]all Permitted [[296,415,1183,472][12][,I,][Times New Roman]]Mortgages if the payments described in [[1154,415,1326,472][12][,I,][Times New Roman]]Section [[1313,415,1527,472][12][,I,][Times New Roman]]16.4.3(c) [[1514,415,1929,472][12][,I,][Times New Roman]]are made, and (c) [[1929,415,2301,472][12][,I,][Times New Roman]]all other Liens, [[300,473,1049,530][12][,I,][Times New Roman]]including Construction Liens and su [[1024,473,1380,530][12][,I,][Times New Roman]]bject only to (w) [[1359,473,2301,530][12][,I,][Times New Roman]]the Permitted Exceptions in effect at the time [[300,530,1383,587][12][,I,][Times New Roman]]of the original Close of Escrow for such Property, (x) [[1361,530,2300,587][12][,I,][Times New Roman]]utility easements and/or roadway easements, [[300,587,389,644][12][,I,][Times New Roman]](y) [[367,587,2247,644][12][,I,][Times New Roman]]other matters affecting title consented to or requested by any Governmental Authority wi [[2212,587,2301,644][12][,I,][Times New Roman]]th [[300,645,2300,702][12][,I,][Times New Roman]]respect to the Property in connection with development of the Property, or requested by the City [[300,702,1908,759][12][,I,][Times New Roman]]and any covenants recorded in order to comply with the Entitlements, and (z) [[1887,702,2301,759][12][,I,][Times New Roman]]the DA and Other [[297,760,1618,817][12][,I,][Times New Roman]]Agreements recorded in accordance with the terms of this Agree [[1590,760,1750,817][12][,I,][Times New Roman]]ment. [[750,866,1350,923][12][B,I,][Times New Roman]]Continuation of Agreement [[600,867,750,924][12][,I,][Times New Roman]]16.4.7 [[1314,867,2300,924][12][,I,][Times New Roman]]. This Agreement shall remain in full force and [[300,925,2300,982][12][,I,][Times New Roman]]effect with respect to portions of the Property not revested in the City, but the termination of this [[297,982,1724,1039][12][,I,][Times New Roman]]Agreement shall be effective as of the date title to any portion o [[1690,982,2300,1039][12][,I,][Times New Roman]]f the Property and/or any [[298,1040,1277,1097][12][,I,][Times New Roman]]Improvements thereon are revested in the City. [[750,1147,1494,1204][12][B,I,][Times New Roman]]Termination of Right of Reversion [[600,1148,750,1205][12][,I,][Times New Roman]]16.4.8 [[1472,1148,1522,1205][12][,I,][Times New Roman]]. [[1512,1148,1998,1205][12][,I,][Times New Roman]]Except as set forth in [[1963,1148,2275,1205 ][12][,I,][Times New Roman]]Section 16.4.1 [[300,1205,555,1262][12][,I,][Times New Roman]](including [[521,1205,753,1262][12][,I,][Times New Roman]]clause (k) [[734,1205,1418,1262][12][,I,][Times New Roman]]thereof) with respect to any Non [[1393,1205,1443,1262][12][,I,][Times New Roman]]- [[1407,1205,2300,1262][12][,I,][Times New Roman]]Permitted Foreclosure Event, the right of [[300,1262,2300,1319][12][,I,][Times New Roman]]the City to exercise the Right of Reversion with respect to any Phase of the Project or the Property [[300,1320,1938,1377][12][,I,][Times New Roman]]comprising such Phase shall terminate and be of no further force and effect upo [[1913,1320,2300,1377][12][,I,][Times New Roman]]n the occurrence [[300,1377,2300,1434][12][,I,][Times New Roman]]of the Equity Completion Date with respect to such Phase and, upon its receipt of written [[300,1435,2300,1492][12][,I,][Times New Roman]]certification from an authorized officer of Developer for such Phase and such other information [[291,1492,1454,1549][12][,I,][Times New Roman]]from Developer as the City may reasonably request to [[1419,1492,2300,1549][12][,I,][Times New Roman]]confirm that the Equity Completion Date [[300,1550,2300,1607][12][,I,][Times New Roman]]has occurred (including invoices and evidence of payment of invoices in the required amounts [[299,1607,2300,1664][12][,I,][Times New Roman]]without utilizing proceeds of any Permitted Mortgage for such purpose, and, for the avoidance of [[300,1665,851,1722][12][,I,][Times New Roman]]doubt, including all such [[814,1665,2300,1722][12][,I,][Times New Roman]]costs incurred by the Developer named herein and any Affiliate thereof [[300,1722,2300,1779][12][,I,][Times New Roman]]to which this Agreement is assigned in accordance with the terms and conditions of this [[297,1780,2300,1837][12][,I,][Times New Roman]]Agreement), the City will confirm the same in writing to Developer and any applicable Permitted [[296,1837,350,1894][12][,I,][Times New Roman]]M [[341,1837,2300,1894][12][,I,][Times New Roman]]ortgagee, with the City’s confirmation being conditioned upon such information provided by [[298,1895,2300,1952][12][,I,][Times New Roman]]Developer being true and correct upon which the City shall be entitled to rely, but in the event the [[300,1952,1608,2009][12][,I,][Times New Roman]]certification of a Developer is not true and correct, the City s [[1577,1952,2300,2009][12][,I,][Times New Roman]]hall not be deemed to waive any [[300,2010,2300,2067][12][,I,][Times New Roman]]rights against such Developer (but not any successor party that becomes a Developer in [[300,2067,1400,2124][12][,I,][Times New Roman]]accordance with this Agreement) for such inaccuracy [[1372,2067,1422,2124][12][,I,][Times New Roman]]. [[750,2174,1321,2231][12][B,I,][Times New Roman]]Waiver of Certain Matters [[600,2175,750,2232][12][,I,][Times New Roman]]16.4.9 [[1291,2175,2300,2232][12][,I,][Times New Roman]]. Developer hereby (a) acknowledges that it has [[300,2232,414,2289][12][,I,][Times New Roman]]revi [[377,2232,2300,2289][12][,I,][Times New Roman]]ewed and understands the implications of each of the following sections of the California Code [[300,2290,2300,2347][12][,I,][Times New Roman]]of Civil Procedure and (b) agrees that the City may exercise any and all of the rights contained in [[300,2347,423,2404][12][,I,][Times New Roman]]this [[386,2347,622,2404][12][,I,][Times New Roman]]Section 16 [[609,2347,1547,2404][12][,I,][Times New Roman]]without such exercise constituting an “action [[1522,2347,2300,2404][12][,I,][Times New Roman]]” under any of Sections 580a, 580b, [[300,2405,2300,2462][12][,I,][Times New Roman]]580d, or 726 of the Code of Civil Procedure or any case interpreting any of said Sections or any [[300,2462,2300,2519][12][,I,][Times New Roman]]doctrine or defense based in whole or in part on such sections of the Code of Civil Procedure and [[298,2520,866,2577][12][,I,][Times New Roman]]Developer hereby waives i [[830,2520,2300,2577][12][,I,][Times New Roman]]ts right to assert and agrees not to assert any position or defense based [[300,2577,2300,2634][12][,I,][Times New Roman]]in whole or in part upon such sections of the Code of Civil Procedure and hereby waives any [[300,2635,1969,2692][12][,I,][Times New Roman]]benefit of such sections of the Code of Civil Procedure as might otherwise apply.” 5.Certificates of Compliance. If the Developer satisfies the Conditions Precedent set forth in Section9.2of the DDA with respect to issuance of a Certificate of Compliance for the Phase 1Parcel(or any permitted portion thereof) or in Section9.3of the DDA with respect to issuance of a Certificate of Compliance for the Phase 2Parcel(or any permitted portion thereof), Tustin Cornerstone I DDA Form City of Tustin/ ATTACHMENT 12 Memo of DDA (1st Am revised) Att Cornerstone I 13 12 6-11-2017 (agd).docx then the City shall Record the appropriate Certificate of Compliance upon written request by Developer. The Certificate of Compliance so Recorded shall be binding upon the Parties to this Memorandum of DDA, their successors and assigns, and shall be deemed,with respect to the Parcel or portion thereof to which the Certificate of Compliance is applicable,to be the City's conclusive determination of satisfactory Completion of the Improvements covered by such Certificate of Compliance and compliance with all other conditions required by the DDA, subject only to such continuing terms of the DDA referenced in Section9.7of the DDA,and/or the covenants, conditions, restrictions and obligations set forth in this Memorandumof DDA, the Special Restrictions, the DA, the Roadway Easement and Utility Agreement, the Landscape Installation and Maintenance Agreement, the CC&Rs and the Quitclaim Deed(s),each of which shall survive in accordance with its respective terms. For ease of reference only, the following italicized Section9.7is copied verbatim from the DDA: [[599,1039,1937,1096][12][B,I,][Times New Roman]]Effect of Certificate of Compliance; Termination of Agreement [[450,1040,565,1097][12][,I,][Times New Roman]]“9.7 [[1902,1040,1952,1097][12][,I,][Times New Roman]]. [[448,1148,671,1205][12][,I,][Times New Roman]]Except as [[652,1148,999,1205][12][,I,][Times New Roman]]set forth in this [[959,1148,1131,1205][12][,I,][Times New Roman]]Section [[1119,1148,1207,120 5][12][,I,][Times New Roman]]9.7 [[1193,1148,2301,1205][12][,I,][Times New Roman]]and any Certificate of Compliance issued by the City, [[300,1205,2300,1262][12][,I,][Times New Roman]]after the Recording of a Certificate of Compliance with respect to any Phase (or portion thereof if [[300,1262,1754,1319][12][,I,][Times New Roman]]applicable), any Person then owning or thereafter purchasing, leasing, [[1714,1262,2300,1319][12][,I,][Times New Roman]]or otherwise acquiring any [[300,1320,2300,1377][12][,I,][Times New Roman]]interest in the Parcel subject to the Certificate of Compliance or the Improvements thereon (or [[300,1377,2300,1434][12][,I,][Times New Roman]]any portion thereof) shall not (because of such ownership, purchase, lease or acquisition) incur [[300,1435,1037,1492][12][,I,][Times New Roman]]any obligation or liability under th [[1012,1435,2300,1492][12][,I,][Times New Roman]]is Agreement with respect to such Improvements, except that [[300,1492,2300,1549][12][,I,][Times New Roman]]such Party shall continue to be bound by the Other Agreements in each case to the extent set forth [[300,1550,2206,1607][12][,I,][Times New Roman]]therein. Issuance of the Certificate of Compliance shall not waive any rights or claim that the [[2166,1550,2300,1607][12][,I,][Times New Roman]]City [[300,1607,2300,1664][12][,I,][Times New Roman]]might have against any party for latent or patent defects in design, construction or similar matters [[300,1665,2300,1722][12][,I,][Times New Roman]]under any applicable law, nor shall it be evidence of satisfaction of any of Developer’s obligations [[300,1722,1300,1779][12][,I,][Times New Roman]]to others not a party to this Agreement. The Cer [[1269,1722,2300,1779][12][,I,][Times New Roman]]tificate of Compliance shall be in such form as to [[293,1780,2300,1837][12][,I,][Times New Roman]]permit it to be Recorded. Upon Recording of the Certificate of Compliance, this Agreement shall [[300,1837,2300,1894][12][,I,][Times New Roman]]terminate in its entirety with respect to the Project and Property to which such Certificate of [[300,1895,604,1952][12][,I,][Times New Roman]]Compliance a [[572,1895,1008,1952][12][,I,][Times New Roman]]pplies, except that: [[900,2002,1315,2059][12][,I,][Times New Roman]]the provisions of [[1293,2002,1465,2059][12][,I,][Times New Roman]]Section [[1451,2002,1526,2059][12][,I,][Times New Roman]]4. [[1489,2002,1564,2059][ 12][,I,][Times New Roman]]5. [[1526,2002,1576,2059][12][,I,][Times New Roman]]2 [[1551,2002,2300,2059][12][,I,][Times New Roman]], including the release set forth [[300,2060,2284,2117][12][,I,][Times New Roman]]therein, shall survive in perpetuity to the extent set forth in the Quitclaim Deed for such Property; [[900,2167,1285,2224][12][,I,][Times New Roman]]the provisions of [[1248,2167,1420,2224][12][,I,][Times New Roman]]Section [[1407,2167,1457,2224][12][,I,][Times New Roman]]1 [[1432,2167,1545,2224][1 2][,I,][Times New Roman]]1.1. [[1507,2167,1557,2224][12][,I,][Times New Roman]]4 [[1545,2167,2300,2224][12][,I,][Times New Roman]]shall survive until the expiration of [[300,2225,1403,2282][12][,I,][Times New Roman]]the time period for provision of the environmental ins [[1372,2225,2065,2282][12][,I,][Times New Roman]]urance policy described thereby; [[900,2332,950,2389][12][,I,][Times New Roman]]n [[925,2332,1248,2389][12][,I,][Times New Roman]]otwithstanding [[1261,2332,2300,2389][12][,I,][Times New Roman]]anything to the contrary contained in this [[297,2390,626,2447][12][,I,][Times New Roman]]Agreement, (i) [[604,2390,1136,2447][12][,I,][Times New Roman]]the releases set forth in [[1102,2390,1446,2447][12][,I,][Times New Roman]]Section 4.5.2(f) [[1428,2390,1733,2447][12][,I,][Times New Roman]]shall remain [[1700,2390,2300,2447][12][,I,][Times New Roman]]in effect and shall bind the [[300,2447,511,2504][12][,I,][Times New Roman]]releasing [[495,2447,2300,2504][12][,I,][Times New Roman]]party and its successors and assigns to the extent set forth in the Quitclaim Deed for [[300,2505,1268,2562][12][,I,][Times New Roman]]such Property, (ii) the indemnities set forth in [[1231,2505,1498,2562][12][,I,][Times New Roman]]Sections 5.5 [[1473,2505,1523,2562][12][,I,][Times New Roman]], [[1498,2505,1623,2562][12][,I,][Times New Roman]]8.8.5 [[1598,2505,1648,2562][12][,I,][Times New Roman]], [[1623,2505,1711,2562][12][,I,][Times New Roman]]8.9 [[1686,2505,1736,2562][12] [,I,][Times New Roman]], [[1711,2505,1824,2562][12][,I,][Times New Roman]]8.11 [[1799,2505,1849,2562][12][,I,][Times New Roman]], [[1824,2505,1937,2562][12][,I,][Times New Roman]]8.12 [[1911,2505,1961,2562][12][,I,][Times New Roman]], [[1937,2505,2050,2562][12][,I,][Times New Roman]]10.1 [[2024,2505,2175,2562][12][,I,][Times New Roman]], and [[2138,2505,2276,2562][12][,I,][Times New Roman]]18.11 [[300,2562,878,2619][12][,I,][Times New Roman]]shall remain in effect and [[845,2562,2301,2619][12][,I,][Times New Roman]]shall be binding only upon the owner of any portion of the Property [[300,2620,2300,2677][12][,I,][Times New Roman]]owned by it that is the subject of the Certificate of Compliance and only with respect to matters [[300,2677,2252,2734][12][,I,][Times New Roman]]occurring during the period of its ownership of such portion of the Property, and (iii) th [[2227,2677,2277,2734][12][,I,][Times New Roman]]e [[300,2735,816,2792][12][,I,][Times New Roman]]indemnities set forth in [[781,2735,1055,2792][12][,I,][Times New Roman]]Section 10.2 [[1044,2735,2300,2792][12][,I,][Times New Roman]]shall remain in effect and shall bind the indemnifying party [[300,2792,2300,2849][12][,I,][Times New Roman]]and its successors and assigns (provided that no Permitted Mortgagee or Permitted Mortgagee [[297,2850,1545,2907][12][,I,][Times New Roman]]Affiliate shall be obligated to indemnify the City for any matt [[1509,2850,2301,2907][12][,I,][Times New Roman]]ers first caused, created or occurring Tustin Cornerstone I DDA Form City of Tustin/ ATTACHMENT 12 Memo of DDA (1st Am revised) Att Cornerstone I 14 12 6-11-2017 (agd).docx [[300,300,2300,357][12][,I,][Times New Roman]]after such Permitted Mortgagee or Permitted Mortgagee Affiliate has Transferred the applicable [[293,357,829,414][12][,I,][Times New Roman]]portion of the Property); [[900,465,2300,522][12][,I,][Times New Roman]]any and all obligations contained in the Federal Deeds shall survive [[300,523,860,580][12][,I,][Times New Roman]]in perpetuity to the extent [[841,523,1859,580][12][,I,][Times New Roman]]set forth therein, unless such obligations are rel [[1822,523,2299,580][12][,I,] [Times New Roman]]eased by the Federal [[300,580,676,637][12][,I,][Times New Roman]]Government; and [[900,687,989,744][12][,I,][Times New Roman]]the [[970,687,1347,744][12][,I,][Times New Roman]]Restrictions and [[1307,687,1538,744][12][,I,][Times New Roman]]covenants [[1517,687,1606,744][12][,I,] [Times New Roman]]of [[1567,687,1837,744][12][,I,][Times New Roman]]Section 8.13 [[1823,687,2300,744][12][,I,][Times New Roman]]shall survive until the [[300,745,2300,802][12][,I,][Times New Roman]]expiration of the time period for such Restrictions and covenants as set forth therein, [[300,802,520,859][12][,I,][Times New Roman]]notwithst [[484,802,1960,859][12][,I,][Times New Roman]]anding anything to the contrary contained in this Agreement (including [[1922,802,2219,859][12][, I,][Times New Roman]]Section 18.14 [[2187,802,2271,859][12][,I,][Times New Roman]]).” 6.DDA and Memorandum of DDA Run with the Land. The DDA and this Memorandum of DDA, including, without limitation, the provisions of 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 the Developer and by the City to be covenants running with the land and enforceable as equitable servitudes against the Development Parcels and are hereby declared to be and shall be binding upon the Development Parcels and Developer and its successors and assigns (who may own all 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 Certificate of Compliance as provided for in Section5above. 7.Priority of DDA and Special Restrictions. The DDA, including without limitation the City Lien, the Right of Repurchase and the Right of Reversion contained therein, this Memorandum of DDA,the Special Restrictions,the Roadway and Utility Easement Agreement, and the Landscape Installation and Maintenance Agreementshall be superior in priority to all Mortgages. 8.Lien Rights.Underthe terms of the DDA, 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 City and its successors and assigns agrees that the delinquent amount of any payments due underthe DDA, together with any late charges or interest due on any such delinquent payment, attorneys’ fees, experts’ fees and consultants’ fees and collection costs and the cost of in-house staff time (including City overhead and administrative 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 continuing lien upon the Property in favor of the City effective upon Recording of thisMemorandum, which lien and charge shall be paramount to the lien and charge of each and every Mortgage, Construction Lien and other lien uponor affecting the Property(and, subject to the rights of a Permitted Mortgagee under Section 17.6.2, the City shall have the right to foreclose the City Lien with respect to any Property so encumbered by such lien). 9.Acknowledgment and Assumption by Developer. By Recording of this Memorandum of DDA Developer hereby acknowledges and assumes all responsibilities placed upon Developer under 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. Tustin Cornerstone I DDA Form City of Tustin/ ATTACHMENT 12 Memo of DDA (1st Am revised) Att Cornerstone I 15 12 6-11-2017 (agd).docx 11.Interpretation; Notice. This Memorandum of DDA is prepared for recordation and notice purposes only and in no way modifiesor expandsthe 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. 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. [[1028,860,1396,917][12][,I,][Times New Roman]][signature page [[1349,860,1552,917][12][,I,][Times New Roman]]follows] Tustin Cornerstone I DDA Form City of Tustin/ ATTACHMENT 12 Memo of DDA (1st Am revised) Att Cornerstone I 16 12 6-11-2017 (agd).docx IN WITNESSWHEREOF, the City and Developer have executed this Memorandum of DDA as of the Memorandum Effective Date. Date:_____________________“CITY” CITY OF TUSTIN ATTEST:By: Jeffrey C. Parker, City Manager By: Erica N. Rabe, City Clerk APPROVED AS TOFORM By: David Kendig, City Attorney Armbruster Goldsmith & Delvac LLP Special Tustin Counsel By: Amy E. Freilich [[894,2360,1731,2417][12][,I,][Times New Roman]]{signatures continue on following page} Tustin Cornerstone I DDA Form City of Tustin/ ATTACHMENT 12 Memo of DDA (1st Am revised) Att Cornerstone I S-1 12 6-11-2017 (agd).docx Date:__________________________“DEVELOPER” FLIGHTPHASE I OWNERLLC, a Delaware limited liability company By: ________________________ Name: Title: Tustin Cornerstone I DDA Form Memo City of Tustin/ ATTACHMENT 12 of DDA (1st Am revised) Att 12 6-11-Cornerstone I S-2 2017 (agd).docx ACKNOWLEDGMENT ß ²±¬¿®§ °«¾´·½ ±® ±¬¸»® ±ºº·½»® ½±³°´»¬·²¹ ¬¸· ½»®¬·º·½¿¬» ª»®·º·» ±²´§ ¬¸» ·¼»²¬·¬§ ±º ¬¸» ·²¼·ª·¼«¿´ ©¸± ·¹²»¼ ¬¸» ¼±½«³»²¬ ¬± ©¸·½¸ ¬¸· ½»®¬·º·½¿¬» · ¿¬¬¿½¸»¼ô ¿²¼ ²±¬ ¬¸» ¬®«¬¸º«´²»ô ¿½½«®¿½§ô ±® ª¿´·¼·¬§ ±º ¬¸¿¬ ¼±½«³»²¬ò State of California) County of Orange) On _________________, before me, ______________________________, Notary Public, personally appeared ______________________________, who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribedto 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) Tustin Cornerstone I DDA Form Memo City of Tustin/ ATTACHMENT 12 of DDA (1st Am revised) Att 12 6-11-Cornerstone I S-3 2017 (agd).docx ACKNOWLEDGMENT ß ²±¬¿®§ °«¾´·½ ±® ±¬¸»® ±ºº·½»®½±³°´»¬·²¹ ¬¸· ½»®¬·º·½¿¬» ª»®·º·» ±²´§ ¬¸» ·¼»²¬·¬§ ±º ¬¸» ·²¼·ª·¼«¿´ ©¸± ·¹²»¼ ¬¸» ¼±½«³»²¬ ¬± ©¸·½¸ ¬¸· ½»®¬·º·½¿¬» · ¿¬¬¿½¸»¼ô ¿²¼ ²±¬ ¬¸» ¬®«¬¸º«´²»ô ¿½½«®¿½§ô ±® ª¿´·¼·¬§ ±º ¬¸¿¬ ¼±½«³»²¬ò State of California) County of Orange) On _________________, before me, ______________________________, Notary Public, 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: (Seal) Tustin Cornerstone I DDA Form Memo City of Tustin/ ATTACHMENT 12 of DDA (1st Am revised) Att 12 6-11-Cornerstone I S-4 2017 (agd).docx EXHIBIT A DEVELOPMENT PARCELS LEGAL DESCRIPTON Real property in the City of Tustin, County of Orange, State of California, described as follows: Parcel 1: LOTS 1 THROUGH 10, INCLUSIVE, OF TRACT NO. 18082, AS SHOWN BY TRACT MAP ON FILE IN BOOK _____, PAGES _____, INCLUSIVE, OF TRACT MAPS, RECORDS OF ORANGE COUNTY, CALIFORNIA. EXCEPTING THEREFROM ANY AND ALL OIL, OILRIGHTS, MINERALS, MINERAL RIGHTS, NATURAL GAS, NATURAL GAS RIGHTS AND OTHER HYDROCARBONS BY WHATSOEVER NAME KNOWN, GEOTHERMAL STEAM AND ALL PRODUCTS DERIVED FROM ANY OF THE FOREGOING THAT MAY BE WITHIN OR UNDER THE LAND, TOGETHER WITH THE PERPETUAL RIGHT OF DRILLING, MINING, EXPLORING FOR AND STORING IN AND REMOVING THE SAME FROM THE LAND OR ANY OTHER LAND, INCLUDING THE RIGHT TO WHIPSTOCK OR DIRECTIONALLY DRILL AND MINE FROM LANDS OTHER THAN THE LAND, OIL OR GAS WELLS, TUNNELS AND SHAFTS INTO, THROUGH OR ACROSS THE SUBSURFACE OF THE LAND 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 LAND IN THE EXERCISE OF SUCH RIGHTS OR OTHERWISE ADVERSELY AFFECT THE USE OR OPERATION OF THE LAND OR THE STRUCTURAL INTEGRITY OF ANY IMPROVEMENTS ON THE LAND, AS RESERVEDIN THE QUITCLAIM DEED FROM THE CITY OF TUSTIN, CALIFORNIA, RECORDED ________, 2017 AS INSTRUMENT NO. __________________ OF OFFICIAL RECORDS. ALSO EXCEPTING THEREFROM ANY AND ALL WATER, WATER RIGHTS OR INTERESTS THEREIN APPURTENANT OR RELATING TO THE LAND OR OWNED OR USED BY THE GRANTOR IN CONNECTION WITH OR WITH RESPECT TO THE LAND NO MATTER HOW ACQUIRED BY THE GRANTOR, 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 LAND, TO STORE THE SAME BENEATH THE SURFACE OF THE LAND AND TO DIVERT OR OTHERWISE UTILIZE SUCH WATER, RIGHTS OR INTERESTS ON ANY OTHER PROPERTY OWNED OR LEASED BY GRANTOR; BUT WITHOUT, HOWEVER, THE RIGHT TO ENTER UPON OR USE THE SURFACE OF THE LAND IN THE EXERCISE OF SUCH RIGHTS OR OTHERWISE ADVERSELY AFFECT THE USE OR OPERATION OF THE LAND OR THE STRUCTURAL INTEGRITY OF ANY IMPROVEMENTS ON THE LAND, AS RESERVED Tustin Cornerstone I DDA Form Memo City of Tustin/ ATTACHMENT 12 of DDA (1st Am revised) Att 12 6-11-Cornerstone I EXHIBIT A 2017 (agd).docx 1 IN THE QUITCLAIM DEED FROM THE CITY OF TUSTIN, CALIFORNIA, RECORDED ___________, 2017 AS INSTRUMENT NO. _______________ OF OFFICIAL RECORDS. Parcel 2: PARCEL 2 OF PARCEL MAP NO. 2015-168, AS SHOWN ON A MAP FILED IN BOOK 388, PAGES 26 AND 27 OF PARCEL MAPS, RECORDS OF ORANGE COUNTY, CALIFORNIA; EXCEPTING THEREFROM ANY AND ALL OIL, OIL RIGHTS, MINERALS, MINERAL RIGHTS, NATURAL GAS, NATURAL GAS RIGHTS AND OTHER HYDROCARBONS BY WHATSOEVER NAME KNOWN, GEOTHERMAL STEAM AND ALL PRODUCTS DERIVED FROM ANY OF THE FOREGOING THAT MAY BE WITHIN OR UNDER THE LAND, TOGETHER WITH THE PERPETUAL RIGHT OF DRILLING, MINING, EXPLORING FOR AND STORING IN AND REMOVING THE SAME FROM THE LAND OR ANY OTHER LAND, INCLUDING THE RIGHT TO WHIPSTOCK OR DIRECTIONALLY DRILL AND MINE FROM LANDS OTHER THAN THE LAND, OIL OR GAS WELLS, TUNNELS AND SHAFTS INTO, THROUGH OR ACROSS THE SUBSURFACE OF THE LAND 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 LAND IN THE EXERCISE OF SUCH RIGHTS OR OTHERWISE ADVERSELY AFFECT THE USE OR OPERATION OF THE LAND OR THE STRUCTURAL INTEGRITY OF ANY IMPROVEMENTS ON THE LAND. ALSO EXCEPTING THEREFROM ANY AND ALL WATER, WATER RIGHTS OR INTERESTS THEREIN APPURTENANT OR RELATING TO THE LAND OR OWNED OR USED BY THE GRANTOR IN CONNECTION WITH OR WITH RESPECT TO THE LAND NO MATTER HOW ACQUIRED BY THE GRANTOR, 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 LAND, TO STORE THE SAME BENEATH THE SURFACE OF THE LAND AND TO DIVERT OR OTHERWISE UTILIZE SUCH WATER, RIGHTS OR INTERESTS ON ANY OTHER PROPERTY OWNED OR LEASED BY GRANTOR; BUT WITHOUT, HOWEVER,THE RIGHT TO ENTER UPON OR USE THE SURFACE OF THE LAND IN THE EXERCISE OF SUCH RIGHTS OR OTHERWISE ADVERSELY AFFECT THE USE OR OPERATION OF THE LAND OR THE STRUCTURAL INTEGRITY OF ANY IMPROVEMENTS ON THE L Tustin Cornerstone I DDA Form Memo City of Tustin/ ATTACHMENT 12 of DDA (1st Am revised) Att 12 6-11-Cornerstone I EXHIBIT A 2017 (agd).docx 2 Attachment 21 Form of Roadway and Utility Easement Agreement ATTACHMENT 21 ROADWAY, LANDSCAPE AND UTILITY EASEMENT 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 ROADWAY, LANDSCAPE AND UTILITY EASEMENT AGREEMENT Flight at Tustin Legacy -Form of Roadway and SMRH:479632046.27Utility Easement Agreement 06141725WR-246894 TABLE OF CONTENTS Page ARTICLE1 DEFINITIONS............................................................................................................................3 1.1 "Agreement"...................................................................................................................3 1.2 "Affiliate".........................................................................................................................3 1.3 "Association"..................................................................................................................3 1.4 "Association Declaration"...............................................................................................3 1.5 "City"...............................................................................................................................3 1.6 "City Indemnified Parties"...............................................................................................3 1.7 "City Successor".............................................................................................................3 1.8 "Claims"..........................................................................................................................3 1.9 "Complete"and "Completion"........................................................................................3 1.10 "Control","Controlled"or "Controlling"...........................................................................4 1.11 "Default".........................................................................................................................4 1.12 "Default Interest Rate"....................................................................................................4 1.13 "Development Parcels"..................................................................................................4 1.14 "Easement Area"............................................................................................................4 1.15 "Easement Areas"..........................................................................................................4 1.16 "Easement Area Improvements"....................................................................................4 1.17 "Easement Area Improvements Completion".................................................................4 1.18 "Easement Area Improvements Completion Date"........................................................4 1.19 "Event of Default"...........................................................................................................4 1.20 "Final Map".....................................................................................................................4 1.21 "Flight Association"........................................................................................................4 1.22 "Flight Declaration".........................................................................................................5 1.23 "Governmental Authority"...............................................................................................5 1.24 "Ground Lease"..............................................................................................................5 1.25 "High Quality Project".....................................................................................................5 1.26 "High Quality Standards"................................................................................................5 1.27 "Indemnified Parties"......................................................................................................5 1.28 "Installed Utility Facilities"..............................................................................................5 1.29 "Landscape Agreement"................................................................................................5 1.30 "Landscape Easement Area".........................................................................................5 1.31 "Landscape Improvements "..........................................................................................5 1.32 "License Agreement"......................................................................................................5 1.33 "Lot"................................................................................................................................5 1.34 "Maintenance Commencement Date"............................................................................5 1.35 "Maintenance Obligations".............................................................................................5 1.36 "Maintenance"or "Maintain"...........................................................................................5 1.37 "Maintenance Responsibility Areas"..............................................................................6 1.38 "Master Association"......................................................................................................6 1.39 "Master Association Incorporation Date".......................................................................6 1.40 "Master Association Incorporation Event"......................................................................6 1.41 "Master Declaration"......................................................................................................6 1.42 "Non-Curing Party".........................................................................................................6 1.43 "Official Records"...........................................................................................................6 1.44 "Option"..........................................................................................................................6 1.45 "Owner"..........................................................................................................................6 1.46 "Pedestrian Easement Area"..........................................................................................6 1.47 "Permittees"....................................................................................................................6 1.48 "Phase"...........................................................................................................................6 1.49 "Phase1 Owner"............................................................................................................6 1.50 "Phase1 Parcel"............................................................................................................6 1.51 "Phase2 Annexation"....................................................................................................6 Attachment 21 Flight at Tustin Legacy -Form of Roadway and -i- SMRH:479632046.27Utility Easement Agreement 06141725WR-246894 1.52 "Phase2 Association"....................................................................................................7 1.53 "Phase2 Declaration"....................................................................................................7 1.54 "Phase2 Lots"................................................................................................................7 1.55 "Phase2 Owner"............................................................................................................7 1.56 "Phase2 Parcel..............................................................................................................7 1.57 "Phase2 Transfer Date"................................................................................................7 1.58 "Private Drainage Easement Area"................................................................................7 1.59 "Private Drainage Facilities"...........................................................................................7 1.60 "Public Access Right".....................................................................................................7 1.61 Public Access Declaration"............................................................................................7 1.62 "Requirements"..............................................................................................................7 1.63 "Representatives"...........................................................................................................8 1.64 Responsible Association"...............................................................................................8 1.65 "Responsible Party"or "Responsible Parties"...............................................................8 1.66 "Successor Owners"......................................................................................................8 1.67 "Roadway Easement Area"............................................................................................8 1.68 "Utility Easement Area"..................................................................................................8 1.69 "Utility Facilities".............................................................................................................8 ARTICLE2 ESTABLISHMENT OF EASEMENTS.......................................................................................8 2.1Ownership and Establishment of Easements................................................................8 2.2Defined Terms Relating to Easements..........................................................................9 2.3Vehicular and Bicycle Ingress and Egress Easement...................................................9 2.4Pedestrian Ingress and Egress Easement.....................................................................9 2.5Private Drainage Easement...........................................................................................9 2.6Landscape Easement Area..........................................................................................10 2.7Maintenance and Other Easements............................................................................10 2.8Utility Easement Areas.................................................................................................10 2.9Installation of Additional Easement Area Improvements.............................................11 2.10Indemnity......................................................................................................................11 2.11Limitations on Easement Rights..................................................................................12 2.12Permitted Use..............................................................................................................12 ARTICLE3 MAINTENANCE OF THE MAINTENANCE RESPONSIBILITY AREAS.................................13 3.1Commencement of Maintenance of Maintenance Responsibility Areas.....................13 3.2Maintenance Obligations..............................................................................................13 3.3Performance of Maintenance Obligations....................................................................14 3.4City Self-Help Remedies..............................................................................................14 3.5Remedies of Associations............................................................................................14 3.6Duty to Protect Against Mechanics'Liens....................................................................14 3.7Expenses.....................................................................................................................15 ARTICLE4 INSURANCE, CASUALTY AND INDEMNITY.........................................................................15 4.1Insurance.....................................................................................................................15 4.2Casualty.......................................................................................................................16 ARTICLE5 ENFORCEMENT AND TERMINATION...................................................................................17 5.1City Remedies..............................................................................................................17 5.2Enforcement by Associations and the City..................................................................17 5.3Remedies for Non-Payment.........................................................................................18 ARTICLE6 AMENDMENT..........................................................................................................................18 6.1Amendment..................................................................................................................18 6.2Cooperation..................................................................................................................18 Attachment 21 Flight at Tustin Legacy -Form of Roadway and -ii- SMRH:479632046.27Utility Easement Agreement 06141725WR-246894 ARTICLE7GENERAL PROVISIONS........................................................................................................18 7.1Subdivision...................................................................................................................18 7.2Compliance with Requirements...................................................................................18 7.3Estoppel Certificate......................................................................................................19 7.4Excuse for Non-Performance.......................................................................................19 7.5Effect on Third Parties..................................................................................................19 7.6Third Party Beneficiary.................................................................................................19 7.7Successors and Assigns..............................................................................................19 7.8Notices.........................................................................................................................20 7.9Covenant of Further Assurances.................................................................................21 7.10Partial Invalidity............................................................................................................21 7.11Not a Public Dedication................................................................................................21 7.12Severability...................................................................................................................22 7.13Governing Law.............................................................................................................22 7.14Waiver and Default.......................................................................................................22 7.15References to Sections, Clauses and Exhibits............................................................22 7.16Counterparts................................................................................................................22 7.17Runs With the Land; Release and Termination...........................................................22 7.18Assignment..................................................................................................................22 Attachment 21 Flight at Tustin Legacy -Form of Roadway and -iii- SMRH:479632046.27Utility Easement Agreement 06141725WR-246894 ROADWAY, LANDSCAPE AND UTILITY EASEMENT AGREEMENT Agreement This ROADWAY, LANDSCAPE AND UTILITY EASEMENT AGREEMENT (the "") is Effective Date made as of ________________, 201__ (the ""), by and between the City of Tustin, a CityPhase2 Owner municipal corporation (""or ""), and Flight PhaseI Owner, LLC, a Delaware limited Phase1 Owner liability company ("") with reference to the facts set forth below. RECITALS All initially capitalized terms used but not defined in the Recitals shall have the meanings set forth in Article1. A. City and Flight Venture LLC, a Delaware limited liability company, the predecessor in interest to Phase1 Owner, have entered into that certain Tustin Legacy Disposition and Development Agreement CornerstoneI dated as of November15, 2016which has been amended pursuant to that certain First Amendment to Tustin Legacy Disposition and Development Agreement CornerstoneI dated DDA as of June20, 2017(as the same may be amended from time to time, the "") pursuant to which Parcel1 Owner has acquired from City that certain real property legally described and depicted on Phase1Parcel Exhibit"A-1"("") and pursuant to the DDA, has the option, as further set forth therein Option ("") to acquire from City that certain real property legally described and depicted on Exhibit"A-2" Phase2ParcelDevelopment Parcels as Parcel 2 (""; and collectively with Phase1 Parcel the "".) The Phase1 Parcel and Phase2 Parcel are generally depictedon Exhibit"A-3". B. After the execution of this Agreement, certain roadways, sidewalks and other improvements within the Easement Area will be constructed by the Phase1 Owner pursuant to the terms of the DDA and the License Agreement as described below and if not constructed by the Phase1 Owner in accordance with the DDA, may be constructed by the City or any Successor Owner of the Phase2 Parcel as further set forth in the DDA. C. The Phase1 Owner and the City, as the fee owners of the Phase1 Parcel and the Phase2 Parcel, respectively, desire to establish and grant reciprocal easements appurtenant to the Phase1 Parcel and the Phase2 Parcel within the area legally described in Exhibit"B-3" for the purposes described below and for the following purposes: (i)providing bicycle and vehicular ingress and egress upon, over, and across the Roadway Easement Area and easements for the maintenance of the Roadway Easement Area; (ii)providing pedestrian ingress and egress upon, over, and across the Pedestrian Easement Area and easements for the maintenance of the Pedestrian Easement Area; (iii)installing, maintaining and using the Landscape Improvements located within the Landscape Easement Area;(iv)installing, maintaining and using the Utility Facilities in, upon, over, across, under, and through the Utility Easement Area, and (v)installing, maintaining and using the Private Drainage Facilitiesin, upon, over, across, under and through the Private Drainage Easement Area. The portion of Phase1Parcel and the Phase2Parcel depicted on Exhibit"B-3"is referred to herein as the "Easement Area"and the Roadway Easement Area, the Pedestrian Easement Area, the Landscape Easement Area, the Private Drainage Easement Area and the Utility Easement Area which are located within the Easement Areaare collectively referred to herein as the "Easement Areas. D. Concurrently with the recordation of this Agreement in the Official Records, a Master Declaration is being recorded in the Official Records against the Phase1 Parcel and Phase2 Parcel which, as described below, provides for the establishment of a Master Association upon the occurrence of certain events described as the Master Association Incorporation Events in the Master Declaration and the Flight Declaration is being recorded in the Official Records against the Phase1 Parcel which, as described below, provides for the establishment of the Flight Association. The Master Declaration and the Flight Declaration establish procedures to ensure that the Maintenance Responsibility Areas are maintained in accordance with all of the requirements set forth in this Agreement as described herein. The Easement Areas and the Easement Area Improvements which shall be maintained in accordance Attachment 21 Flight at Tustin Legacy -Form of Roadway and -1- SMRH:479632046.27Utility Easement Agreement 06131725WR-246894 Maintenance Responsibility with the requirements of this Agreement are referred to herein as the " Areas ." E. Unless the Phase2 Transfer Date occurs prior to the Completion Date for any Phaseof the Easement Improvements, the Flight Association will, upon assignment pursuant to Section7.18 hereof, in addition to any other obligations which are imposed upon it under the Flight Declaration, become the Responsible Party for those Maintenance Responsibility Areas for which responsibility is so assigned to it, for the benefit of the Phase1 Parcel and Phase2 Parcel as provided for herein and the expenses incurred by the Flight Associationfor the maintenance of the Maintenance Responsibility Areas and performance of any other obligations hereunder, including without limitation those on and relating to the Phase2 Parcel, shall be borne solely by the Ownerswithinthe Phase1 Parcel. F. Under the terms of the DDA, an Option has been granted by the City to the Phase1 Owner under the DDA to acquire fee title to the Phase2 Parcel. If the holder of the Option under the DDA or its nominee acquires the entirety of the Phase2 Parcel pursuant to exercise of the Option, the entire Phase2 Parcel shall be annexed to the Flight Declaration and upon such annexation the entire Phase2 Parcel shall be subject to the Flight Declaration and in such case, the Flight Association shall continue to be the Responsible Party hereunder and shall perform all of the Maintenance Obligations for the Maintenance Responsibility Areas as described herein and all other obligations required of it hereunder and the Master Declaration shall terminate in accordance with its terms.However, if the holder of the Option under the DDA or its nominee does not, by exercise of the Option, acquire the entirety of the Phase2 Parcel, the Master Association described in the Master Declaration will be incorporated upon the Phase2 Transfer Date and the Master Association will become the Responsible Party and will assume all of the Maintenance Obligations for the Maintenance Responsibility Areas as described in the Master Declaration and all other obligations required of it hereunder and thereunder. The Master Association may also be incorporated prior to the Phase2 Transfer Date in the event that the Flight Association fails to perform its Maintenance Obligations or any other of its obligations hereunder and as a result, a Flight AssociationEvent of Default occurs as described in the Master Declaration. In such case, if the City elects to incorporate the Master Association, the Master Association shall be obligated to maintain the Maintenance Responsibility Areas hereunder and to perform all other obligations required of the Responsible Party hereunder. The Members of the Master Association shall be the Flight Association and the Phase2 Association. References in this Agreement to the Responsible Association mean the Flight Association while it is obligated to perform the Maintenance Obligations hereunder, and shall mean the Master Association from and after the date on which the Master Association assumes responsibility for performing the Maintenance Obligations hereunder. G. City has approved certain entitlements with respect to the Development Parcels Entitlements ("") pursuant to City Council Resolution Nos.16-59, 16-60, 16-61 and 16-62, including, without limitation, Vesting Tentative Tract Map No.18003. The DDA and the City's conditions of approval with respect to the Entitlements include Condition 3.1 of Resolution Number 16-60 and Conditions2.8, 2.9, 4.1 and 4.2 ofResolution No.16-61 approving Concept Plan 2016-001 (among other things), Conditions adopted by the Tustin City Council on November1, 2016 (""), which require that Phase1 Owner install and maintain, among other things, certain Easement Area Improvements. NOW THEREFORE, in consideration of the mutual covenants set forth below, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the City and the Phase1 Owner have agreed to establish the easements, covenants, conditions, liens and charges set forth in this Agreement all of which shall be covenants which shall run with the land, shall be binding on the Phase1 Parcel and the Phase2 Parcel and shall be enforceable equitable servitudes. Nothing herein is intended to impose upon the City any maintenance obligations, or obligations to pay any expense related to the performance of the Maintenance Obligations or to impose any liens or charges on any portion of the Phase2 Parcel while such portion of the Phase2 Parcel is owned by the City. Attachment 21 Flight at Tustin Legacy -Form of Roadway and -2- SMRH:479632046.27Utility Easement Agreement 06131725WR-246894 ARTICLE 1 DEFINITIONS The following terms shall have the meanings given them below, except as the context otherwise requires. For the avoidance of doubt, in the event any capitalized term is used and not otherwise defined in this Agreement, such term shall have the meaning set forth in the DDA. 1.1"Agreement" meansthis Roadway, Landscape and Utility Easement Agreement and any amendments or supplements thereto. 1.2"Affiliate" means with respect to a specified Person, any other Person that directly or indirectly through one or more intermediaries, Controls or is Controlled by, or is under common Control with, the specified Person. 1.3"Association" means either the Flight Association, Phase2 Association and/or the Master Association as the context requires. 1.4"Association Declaration" means the Flight Declaration, the Master Declaration and/or the Phase2 Declaration, as the context requires. 1.5"City" means the City of Tustin. 1.6"City Indemnified Parties" means theCityand itsappointed and elected officials, agents, attorneys, affiliates, employees, contractors, consultantsand representatives. 1.7"City Successor" means a governmental successor or assign of the City. 1.8"Claims" meansany 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 of compensation whatsoever, direct or indirect, known or unknown, foreseen or unforeseen. 1.9"Complete"and "Completion" meansthe point in time when all of the following shall have occurred with respect to the Easement Area Improvements to be constructed by the Phase1 Owner in the Easement Area pursuant to the DDA and the DA, or with respect to a Phasethereof:(a)such improvements have been substantially completed in accordance with the DDA;(b)theCity has issued its inspection, signoff or other permit activity with respect to such improvements indicating their completion, (c)the recording in the Official Recordsof a Notice of Completion (California Civil Code Section8182) by Phase1 Owner, its Successor Owner or such Successor Owner's contractor; (d)a certification by the appropriate engineer of record that such improvements (with the exception of minor "punchlist"items) have been completed in a good and workmanlike manner and substantially in accordance with the Approved Plans and specifications; and (e)all contractors, subcontractors, laborers, suppliers, Architects, and engineers who performed work on therelevant improvements either (i)shall have been paid in full and shall have executed final unconditional lien waivers or (ii)any mechanic's and/ or materialmen'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, or (iii)the statutory period for filing liens with respect to such Improvements shall have expired without any liens being filed. If additional Easement Area Improvements are constructed after Completion of the initial Easement Area Improvements under the DDA and DA. "Complete" and "Completion" as to such additional improvements means the point in time when all of the requirements of subsections(a)through (e)of this definition have been satisfied for such additional Easement Area Improvements. Attachment 21 Flight at Tustin Legacy -Form of Roadway and -3- SMRH:479632046.27Utility Easement Agreement 06131725WR-246894 1.10"Control","Controlled"or "Controlling" , 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. Notwithstanding the foregoing, the right of a Person to participate directly or indirectly (including through one or more intermediaries) in significant management decisions of another Person, without more, does not constitute "Control"if such Person with the right to participate in decisions does not also possess, directly or indirectly (including through one or more intermediaries), the power to direct or cause the direction of the management and policies of such other Person. 1.11"Default" has the meaning set forth in the DDA. 1.12"Default Interest Rate" means an interest rate of eight percent (8%) per annum, compounded annually, but in no event in excess of the maximum legal rate. 1.13"Development Parcels" means all the Phase1 Parcel and Phase2 Parcel described onExhibit"A-1"andExhibit"A-2"and depicted on Exhibit"A-3", respectively. 1.14"Easement Area" means the portion of the Phase1 Parcel and Phase2 Parcel described on Exhibit"B-3". 1.15"Easement Areas" means individually or collectively as the context requires, the Roadway Easement Area, Pedestrian Easement Area, Landscape Easement Area, Utility Easement Area and/or Private Drainage Easement Area. 1.16"Easement Area Improvements" means all of the improvements within the Easement Area constructed and/or installed by the Phase1 Owner, the Phase2 Owner or any Association for purposes consistent with the Easements granted by this Agreementincluding without limitation, the roadways, landscaping, irrigation, sidewalks, pathways, medians, lighting, utilities, signage and storm drains and other drainage facilities located within the Easement Areas. The Easement Area Improvements shall be constructed or installed in accordance with the Requirements. 1.17"Easement Area Improvements Completion" means the Completion of all or a Phaseof the Easement Area Improvements to be completed by the Phase1 Owner pursuant to the DDA, the DA and the License Agreement, or if such Completion occurs in one or more Phases, the Completion of a Phaseof such Easement Area Improvements pursuant to the DDA and the License Agreement. 1.18"Easement Area Improvements Completion Date" means the date on which the Easement Area Improvements Completion occurs, or, if the Easement Area Improvements Completion occurs in one or more Phases, each date on which the Easement Area Improvements Completion occurs as to Phasesof the Easement Areas, in each case pursuant to the DDA and the License Agreement. 1.19"Event of Default" has the meaning set forth in Section5.1. 1.20"Final Map" means, with respect to the Phase1 Parcel, final tract map no.18082 recorded in the Official Records covering the Phase1 Parcel, and with respect to the Phase2 Parcel, any final tract map or parcel map further subdividing the Phase2 Parcel into Lots, or any parcel map waiver, lot line adjustment or any other subdivision of the Phase1 Parcel and/or Phase2 Parcel in conformance with the Requirements which creates or adjusts the boundaries of any legal lot within the Phase1 Parcel or Phase2 Parcel. 1.21"Flight Association" means the Flight at Tustin Legacy Owners Association, a California non-profit mutual benefit corporation formed or to be formed to govern the Phase1 Parcel, and if the Phase2 Annexation occurs, the Phase2 Parcel. Attachment 21 Flight at Tustin Legacy -Form of Roadway and -4- SMRH:479632046.27Utility Easement Agreement 06131725WR-246894 1.22"Flight Declaration" means the Declaration of Covenants, Conditions and Restrictions and Establishment of Easements of The Flight at Tustin Legacy, and all amendments and supplements thereto. 1.23"Governmental Authority" means any and all federal, State, county, municipal and local governmental and quasi-governmental bodies and authorities (including the United States of America, the State of California and any political subdivision, public corporation, district, college and/or school district, joint powers authority or other political or public entity) or departments thereof having or exercising jurisdiction over the Phase1 Parcel, the Phase2 Parcel, including the Easement Area and/or the Easement Area Improvements located within the Easement Area. 1.24"Ground Lease" means any written ground lease of an entire Lot with an initial term, excluding option terms, of thirty five (35) years or more, which is recorded inthe Official Records or as to which a Memorandum of Lease (or likeinstrument)has been so recorded. 1.25"High Quality Project" means a project for which the operation and maintenance activities, including landscaping, shall be similar to those provided at the Campus at Playa Vista. 1.26"High Quality Standards" means,in terms of the quality of maintenance, standards consistent with a High Quality Project. 1.27"Indemnified Parties" means the officers, directors, employees, partners, members and other representatives of an Owner or Association. 1.28"Installed Utility Facilities" has the meaning set forth in Section2.8. 1.29"Landscape Agreement" means that certain Landscape Installationand Maintenance Agreement between the Phase1 Ownerand City recorded concurrently herewith. 1.30"Landscape Easement Area" means the portions of the Easement Area upon which Landscape Improvements are or shall be located, which Landscape Easement Area isgenerally depicted onExhibit"B-2"attached hereto and incorporated herein. 1.31"Landscape Improvements " means the landscaping and irrigation and other utility facilities reasonably required in connection with such landscaping located within the Landscape Easement Area, 1.32"License Agreement" means that certain License Agreement for Site Development entered into concurrently herewith between the Phase1 Owner and the City. 1.33"Lot" means, individually or collectively, as the context requires, a legal parcel or legal lot within the Development Parcels created under a Final Map. 1.34"Maintenance Commencement Date" means the first date on which the Maintenance Responsibility Areas or any Phasethereof are maintained by the Flight Association or maintained by the Master Association, if the Phase2 Transfer Date has occurred and the Master Association is the first Association to commence such maintenance pursuant to Section3.1. 1.35"Maintenance Obligations" means the obligations of the Responsible Party(ies) to perform the Maintenance for the Maintenance Responsibility Areas in conformance with the requirements of this Agreement. 1.36"Maintenance" or "Maintain" (whether capitalized or not) means the maintenance, repair and replacement of the Maintenance Responsibility Areas which are required to be maintained in Attachment 21 Flight at Tustin Legacy -Form of Roadway and -5- SMRH:479632046.27Utility Easement Agreement 06131725WR-246894 conformance with the Requirements and in a manner intended to maximize the long term preservation andvalue of the Maintenance Responsibility Areas. 1.37"Maintenance Responsibility Areas" has the meaning set forth in RecitalD. 1.38"Master Association" means the Master Maintenance Association for Tustin Legacy CornerstoneI, a California non-profit mutual benefit corporation which shall be incorporated pursuant to the Master Declaration if a Master Association Incorporation Event occurs. 1.39"Master Association Incorporation Date" means the date the Master Association is incorporated pursuant to the Master Declaration. 1.40"Master Association Incorporation Event" has the meaning set forth in the Master Declaration. 1.41"Master Declaration" means the Master Declaration Establishing Maintenance and Cost Sharing Obligations for Tustin Legacy CornerstoneI in the form attached hereto as Exhibit"C", and any amendments and supplements thereto recorded in the Official Records. 1.42"Non-Curing Party" has meaning set forth in Section5.1. 1.43"Official Records" means the official public records in the Office of the County Recorder of Orange County. 1.44"Option" means the option granted by the City to the Phase1 Owner under the DDA to acquire fee title to the Phase2 Parcel. 1.45"Owner" meansthe Phase1 Owner and each Successor Owner during such person's or entity's ownership of a fee title interest in, or Ground Lease interest in, any portion of the Phase1 Parcel or the Phase2 Parcel and (b)each Successor Owner of City, during such person's or entity's ownership of a fee title interest in, or Ground Lease interest in the Phase2 Parcel, but specifically excluding the City and City Successors. 1.46"Pedestrian Easement Area" means the portions of the Easement Area upon which pedestrian use is encouraged through creation of sidewalks, trails or similar Project Improvements and excluding those portions thereof intended for vehicular traffic, which Pedestrian Easement Area is generally depicted on Exhibit"B-2"attached hereto and incorporated herein. 1.47"Permittees" means the Representatives, lessees, invitees, licensees, employees, agents, representatives, contractors, vendors, customers, and tenants of an Owner or any Association, including the Master Association, Flight Association and/or the Phase2 Association. 1.48"Phase"Phases or "" means any segment or other component of the Easement Area Improvements constructed in accordance with the requirements of the DDA, the DA, and the License Agreement which is Complete. 1.49"Phase1 Owner" means the Owner of all or any portion of the Phase1 Parcel. The initial Phase1 Owneris Flight PhaseIOwner LLC, a Delaware limited liability company. 1.50"Phase1 Parcel" means all of the real property described on Exhibit"A-1". 1.51"Phase2 Annexation" means the annexation by the Phase1 Owner of the Phase2 Parcel to the Flight Declaration. Attachment 21 Flight at Tustin Legacy -Form of Roadway and -6- SMRH:479632046.27Utility Easement Agreement 06131725WR-246894 1.52"Phase2 Association" means the owners association which shall be formed to govern the Phase2 Parcel or the portion thereof acquired by the Phase2 Owner upon thePhase2 Transfer Date if and when the Lots within the Phase2 Parcel are owned by multiple different Owners. After the Phase2 Transfer Date, if the Phase2 Association has not been incorporated, and all of the portions of the Phase2 Parcel acquired by the Phase2 Owner are owned by a single Owner, references in this Agreement to the Phase2 Association shall mean such Owner of the Phase2Parcel. 1.53"Phase2 Declaration" means any declaration of covenants, conditions and restrictions recorded in connection with the Phase2 Transfer Date providing for the establishment of the Phase2 Association. 1.54"Phase2 Lots" means any Lots included within the Phase2 Parcel. 1.55"Phase2 Owner" means (a)the City, during any period in which the City is the fee owner of all or any portion of the Phase2 Parcel, as to the portion of the Phase2 Parcel owned by the City and not then subject to a Ground Lease and (b)following conveyance by the City of its fee interest or a Ground Lease interest in all or any portion of the Phase2 Parcel to an entity other than a City Successor, the Owner of such portion of the Phase2 Parcel so conveyed or leased. 1.56"Phase2 Parcel means all of the real property described on Exhibit"A-2". 1.57"Phase2 Transfer Date" means, in the event the holder of the Option under the DDA or its nominee fails to exercise the Option and acquire the entirety of the Phase2 Parcel, the date on which the City transfers fee title to or any Ground Lease interest in all or any portion of the Phase2 Parcel to the Phase2 Owner for the purpose of development of the Phase2 Parcel without such property having been annexed to the Flight Declaration. 1.58"Private Drainage Easement Area" means the portion of theEasement Area within which the Private Drainage Facilities are or shall be located. 1.59"PrivateDrainage Facilities" means the private storm drainand other private drainage facilitieslocated within the Private Drainage Easement Areaapproved for installation by the City on plans for the such facilities approved by the City. 1.60"Public Access Right" means the right ofpublic access for the benefit of the City and the public within the area depicted on Exhibit"B-3" which has been or shall be set forth with respect to the portions thereof located on the Phase1 Parcel, on the Final Map Recorded against the Phase1 Parcel, and with respect to the portions thereof located on the Phase2 Parcel, as legally described on either a Final Map Recorded against the Phase2 Parcelor in any recorded covenant creating such right of public access and/or granting a public access easement for the benefit of the City and the public. 1.61Public Access Declaration" means the instrument or instruments, including without limitation, any Final Map or covenant, creating the Public Access Right upon the Phase1 Parcel and the Phase2 Parcel. 1.62"Requirements" means (a)during the term thereof, the requirements of the DDA, including without limitation, Section8 thereof, the Memorandum of DDA andthe Tustin Legacy Cornerstone I Development Agreement by and between the City and Flight Venture LLC, a Delaware limited liability company dated December15, 2016, which was recorded against the Development Parcels,(b)during theterm of each agreement or instrument recorded pursuant to the DDA, the requirements of such agreement or instrument,(c)the most current general plan for the City and the MCAS Tustin Specific Plan/Reuse Plan, as amended from time to time, (d)the Entitlementsand Conditionsand all future entitlements and conditions of development approved by the City for the Development Parcels, including without limitation those imposed by the City in connection with any discretionary land use approval and entitlements as a condition to the development of the Phase2 Attachment 21 Flight at Tustin Legacy -Form of Roadway and -7- SMRH:479632046.27Utility Easement Agreement 06131725WR-246894 Parcel,and (e)all laws, rules and regulations relating to the obligations under this Agreement,including without limitation, those issued by the City, the Environmental Protection Agency, or any federal, state, interstate, regional or local governmental agency having jurisdictionover the Covered Areas or any of them, including without limitation, with respect to abatement or prevention of pollution. 1.63"Representatives" meanswith respect to the City, the elected and appointed officials of the City, and its employees, agents, representatives, consultants, contractors, and with respect to any Association or Owner means the officers, directors, employees, agents, representatives, consultants and contractors of same. 1.64Responsible Association" initially means the Flight Association, as to the Maintenance Responsibility Areas for which Flight Association has been assigned the obligationshereunder. If and when the Master Association Incorporation Date occurs, then the Master Association (and not the Flight Association) shall be the Responsible Party for the maintenance of the Maintenance Responsibility Areas. 1.65"Responsible Party"or "Responsible Parties" shall initially mean the Phase1 Owner and, if the Cityshall have conveyed fee title to or a Ground Lease interest in all or any portion of Phase2 to any Successor Owner, such Successor Owner, as to the portion of the Phase2 Parcel owned by it or subject to Ground Lease in its favor, but upon the transfer of obligations hereunder in accordance with Section7.18of this Agreement by any Owner with respect to a portion of the Maintenance Responsibility Areas to a Responsible Association, means, as to such Maintenance ResponsibilityArea(s), the Responsible Association(s). 1.66"Successor Owners" means, as applicable, the successors and assigns of Phase1 Owner and/or Phase2 Ownerowning all or any portion of the Development Parcelsand/or holding a Ground Lease interest therein, but specifically excluding Developer,City and City Successors. 1.67"Roadway Easement Area" means the portions of the Easement Area which are generally depicted on Exhibit"B-1"attached hereto and incorporated herein upon which roadways intended for vehicular and bicycle traffic are or shall be located. 1.68"Utility Easement Area" means the portions of the Easement Area upon which Utility Facilities are or shall be located. 1.69"Utility Facilities" means all utility and other similar facilities, including, without limitation, gas lines and pipes, electrical lighting, sewer lines,telephone, cable, and other telecommunication facilities and other utility systems and conduits in connection with the development of improvements upon the Covered Property which facilities are approved for installation by the City on plans for such facilities approved by the City and, if applicable, approved by the relevant utility provider ARTICLE 2 ESTABLISHMENT OF EASEMENTS 2.1Ownership and Establishment of Easements . The easements granted and established hereunder shall commence upon the Effective Date of this Agreement and shall thereafter be deemed to be covenants running with land for the use and benefit of the Phase1 Owner, the Phase2 Owner and the Associations; their Successor Owners and their respective Representatives and Permittees, provided however, during any period prior to the Easement Area Improvements Completion Date for any Easement Areas, so long as the License Agreement and the DDA are both then in effect and the Phase1 Owner is not in Material Default (as such term is defined in the DDA) thereunder, the benefited party shall not utilize the easements in such area in a manner that conflicts with the rights of the Phase1 Owner under the License Agreement. All of the easements described inthis Article2are subject to the limitations set forth below in Section2.11. Attachment 21 Flight at Tustin Legacy -Form of Roadway and -8- SMRH:479632046.27Utility Easement Agreement 06131725WR-246894 2.2Defined Terms Relating to Easements . As used in this Article2, references to "Grantor" shall mean the Phase1 Owner and/or Phase2 Owner as applicable granting the easement hereunder and references to "Grantee" shall mean the recipient of the easement. To the extent any of the easements granted in this Article2are subject to a Public Access Right or Public Access Declaration, the broader rights set forth in this Agreement or the Public Access Declaration shall apply. 2.3Vehicular and Bicycle Ingress and Egress Easement. Phase1 Owner hereby grants to the Phase2 Owner, for the use and benefit of the Phase2 Owner and all Successor Owners of all or any portion of the Phase2 Parcel and to each Association and to the respective Permittees of each of the foregoing a perpetual and non-exclusive appurtenant easement for vehicular and bicycle ingress and egressin, upon, over, and across those portions of the Phase1 Parcel within which the Roadway Easement Area is located. Phase2 Owner hereby grants to the Phase1 Owner for the use and benefit of the Phase1 Owner and all Successor Owners of all or any portion of the Phase1 Parcel and to each Association and to the respective Permittees of each of the foregoinga perpetual and nonexclusive appurtenant easement for vehicular and bicycle ingress and egress,in, upon, over, and across those portions of the Phase2 Parcel within which the Roadway Easement Area is located. 2.4Pedestrian Ingress and Egress Easement .Phase1 Owner hereby grants to the Phase2 Owner, for the use and benefit of the Phase2 Owner and all Successor Owners of all or any portion of the Phase2 Parcel and to each Association and to the respective Permitteesof each of the foregoing, a perpetual and nonexclusive appurtenant easement for pedestrian ingress and egress,in, upon, over and across those portions of the Phase1 Parcel within the Easement Area within which a pedestrian sidewalk is located and any portions ofthe Easement Area on the Phase1 Parcel in which pedestrian access is permitted.Phase2 Owner hereby grants to the Phase1 Owner, for the use and benefit of the Phase1 Owner and all Successor Owners of all or any portion of the Phase1 Parcel and to each Association and to the respective Permitteesof each of the foregoing, aperpetual and nonexclusive appurtenant easement for pedestrian ingress and egress,in, upon, over and across those portions of the Phase2 Parcel within the Easement Areawithin which a pedestrian sidewalk is located and anyportions ofsuch portions of the Easement Areaon the Phase2 Parcel in which pedestrian access is permitted. 2.5Private Drainage Easement .Phase1 Owner hereby grants to the Phase2 Owner,for the use and benefit of the Phase2 Owner and all Successor Owners of all or any portion of the Phase2 Parcel and to each Association and to the respective Permittees of each of the foregoing, a perpetual and nonexclusive appurtenant easement for drainage through any Private Drainage Facilities installed from time to time within the Private Drainage Easement Area,in, upon, over, across, under, and through those portions of the Private Drainage Easement Area located on the Phase1 Parcel within which any Private Drainage Facilities are located or to be located. Phase1 Owner hereby grants to eachResponsible Party for its benefit and the benefit of its successor Responsible Parties and the Representatives of each, a perpetual and nonexclusive appurtenant easement (if the ResponsibleParty owns a Lot) or easement in gross (if the Responsible Party does not own a Lot)in, upon, over, across, under, and through those portions of the Private Drainage Easement Area located on the Phase1Parcel for the installation of any Private Drainage Facilities approved for installation by the City and maintenance, repair and replacement of Private Drainage Facilities within the Private Drainage Easement Area. Phase2Owner hereby grants to the Phase1Owner,for the use and benefit of the Phase1Owner and all Successor Owners of all or any portion of the Phase1Parcel and to each Association and to the respective Permittees of each of the foregoing, a perpetual and nonexclusive appurtenant easementfor drainage through any Private Drainage Facilities installed from time to time within the Private Drainage Easement Area,in, upon, over, across, under, and through those portions of the Private Drainage Easement Area located on the Phase2 Parcel within which any Private Drainage Facilities are located or to be located. Phase2 Owner hereby grants to eachResponsible Party for its benefit and the benefit of its successor Responsible Parties and the Representatives of each, a perpetual and nonexclusive appurtenant easement (if the Responsible Party owns a Lot) or easement in gross (if the Responsible Party does not own a Lot)in, upon, over, across, under, and through those portions of the Private Drainage Easement Area located on the Phase2 Parcel for the installation of any Private Drainage Facilities approved for installation by the City and maintenance, repair and replacement of Private Drainage Facilities within the Private Drainage Easement Area. Attachment 21 Flight at Tustin Legacy -Form of Roadway and -9- SMRH:479632046.27Utility Easement Agreement 06131725WR-246894 2.6Landscape EasementArea .Phase1 Owner hereby grants to the Phase2 Owner,for the use and benefit of the Phase2 Owner and all Successor Owners of all or any portion of the Phase2 Parcel and to each Association and to the respective Permittees of each of the foregoing, a perpetual and nonexclusive appurtenant easement for Landscape Improvements in, upon, overand across, the Landscape Easement Area located on the Phase1 Parcel. Phase1 Owner hereby grants to each Responsible Party for its benefit and the benefit of its successor Responsible Parties and the Representatives of each, a perpetual and nonexclusive appurtenant easement (if the ResponsibleParty owns a Lot) or easement in gross (if the Responsible Party does not own a Lot)in, upon, over, across, under, and through those portions of the Landscape Easement Area located on the Phase1Parcel for the installation, maintenance, repair and replacement of Landscape Improvements within the Landscape Easement Area. Phase2Owner hereby grants to the Phase1Owner,for the use and benefit of the Phase1Owner and all Successor Owners of all or any portion of the Phase1Parcel and to each Association and to the respective Permittees of each of the foregoing, a perpetual and nonexclusive appurtenant easement for Landscape Improvements in, upon, overand across, the Landscape Areas located on the Phase2Parcel. Phase2 Owner hereby grants to eachResponsible Party for its benefit and the benefit of its successor Responsible Parties and the Representatives of each, a perpetual and nonexclusive appurtenant easement (if the ResponsibleParty owns a Lot) or easement in gross (if the Responsible Party does not own a Lot)in, upon, over, across, under, and through those portions of the Landscape Easement Area located on the Phase2Parcel forthe installation, maintenance, repair and replacement of Landscape Improvements within the Landscape Easement Area. 2.7Maintenance and Other Easements . Phase1 Owner and Phase2 Owner each hereby grant to eachResponsible Party for its benefit and the benefit of its successor Responsible Parties, a perpetual and nonexclusive appurtenant easement (if the ResponsibleParty owns a Lot) or easement in gross (if the Responsible Party does not own a Lot) for ingress and egress over the Easement Area by the Responsible Party and its Representatives and to any other Association and its Representatives to the extent any Association is exercising any rights granted to such Association under the Master Declaration for performing any installation, maintenance, repair and/or replacement of the Easement Area Improvements within all or any of the Easement Areas and performing any other obligations imposed under this Agreement and for exercising each of their rights under this Agreement. 2.8Utility Easement Areas. Phase1Owner hereby grants to the Phase2 Owner, for the use and benefit of the Phase2 Owner and its Permittees and Phase2 Owner hereby grants to Phase1 Owner for the use and benefit of the Phase1 Owner and its Permittees, an irrevocable, perpetual and nonexclusive appurtenant easement in, upon, over, across, under, and through those portions of the Utility Easement Area located on the Phase1 Parcel or Phase2 Parcel as applicable within which any Utility Facilities are located or are to be located for the installation of any underground Utility Facilities, whether such Utility Facilities are initially installed in connection with the development of the Phase1 Parcel (in which event such Utility Facilities shall be installed pursuant to the License Agreement) or are installed at a subsequent time in connection with development of the Phase1 Parcel or the Phase2 Parcel, in which event such Utility Facilities shall be permitted to be installed pursuant to the Utility Installed Utility Facilities Easement granted herein ("") and to each Association for its benefit and the benefit of its Permittees a perpetual and non-exclusive appurtenant easement (if the Association does own any Lot) or an easement in gross (if the Association does not own a Lot) in, upon, over, across, under, and through those portions of the Utility Easement Area located on the Phase1 Parcel or Phase2 Parcel as applicable within which any Installed Utility Facilities are located for the use, maintenance, repair and replacement of the Installed Utility Facilities. After the Master Association Incorporation Date, any maintenance, replacement, repair, or removal of Installed Utility Facilities that require the performance of any work by the Flight Association or the Phase2 Association within the Easement Area shall be performed only after fifteen (15)days prior written notice to the Responsible Association of the Responsible Association's intention to do such work to the Installed Utility Facilities, except in the case of an emergency which threatens imminent damage or injury to person or property (in which event notice shall be given as soon as practicable) and shall be subject to conditions reasonably imposed by the Responsible Party including requirements for certificates of insurance and making reasonable arrangements for continued access and otherwise conforming to the applicable requirements of this Agreement. Upon completion of such work, the Association performing the work shall restore the Attachment 21 Flight at Tustin Legacy -Form of Roadway and -10- SMRH:479632046.27Utility Easement Agreement 06131725WR-246894 portions of the Easement Area and Easement Area Improvements affected by such work to the same condition as before the commencement of the work. 2.9Installation of Additional Easement Area Improvements . If an Owner or Association desires to install additional Easement Area Improvements within any of the Easement Area, including without limitation, the installation of Utility Facilities, or to modify the existing Easement Area Additional Work Improvements (""), the following terms and provisions shall apply. As a condition to the Additional Work, the Owner or Association (if the requesting Association is not the Responsible Installing Party Association) requesting to perform such Additional Work ("") shall obtain approval of the Approving Responsible Party and the City prior to the transfer of the entirety of the Phase2 Parcel (" Party "), which consent shall not be unreasonably withheld, delayed or conditioned. The Installing Party shall give not less than fifteen (15)days' notice to the Approving Party of the date the Installing Party desires to commence the Additional Work describing (a)the scope of the Additional Work, (b)the need for such Additional Work, (c)the proposed location for the Additional Work (d)the anticipated commencement and completion dates for the Additional Work,(e)the arrangements which will be made to avoid Unreasonable Disruption to any of the Easement Areas and/or the Easement Area Improvements located thereon and (f)the name of the contractor performing the Additional Work. The notice shall also set forth the schedule for the performance of such Additional Work. Prior to commencing any such Additional Work, the Installing Party shall provide to the Approving Party a certificate of insurance evidencing that its contractor has obtained the minimum insurance coverages required under this Agreement. AnyAdditional Workshall be performed so as not to cause an Unreasonable Disruption to the Easement Areas and/or the Easement Area Improvements, the Public Access Rights, or any Lot and the improvements and facilities located thereon (unless prior written approvalofthe affected Ownerand the City is obtained,provided that following transfer by the City of all of its interests in the Phase2 Parcel, City approval shall be required only with respect to Unreasonable Disruption of any portions of the Easement Areas over which a Public Access Right has been granted and City approval shall be given or withheld in the City's sole discretion) or materially increase the costs of any construction work being performed, on any Lot not owned by such Installing Party. "Unreasonable Disruption"shall mean activities which interfere, in any material respect, with any Installing Party's Permittee's business operations, adversely disrupt in any material respect any Installing Party's Permittee's ability to perform its obligations or conduct its business,which materially impact use, parking, or access; but shall not include minor, short-term disruptions or disruptions which are the result of work necessitated to avoid injury or damage to personsor property or to repair elements of the Development Parcels.Any physical damage occurring to any portion of an affected Lot or any portion of the Easement Area or the Easement Area Improvements as a result of Additional Workshall be the responsibility of theInstalling Partyperforming such construction work or causing such construction work to be performed and shall be promptly repaired by suchInstalling Party, at such Installing Party's sole cost and expense, to the same condition as existed immediately prior to such damage. 2.10Indemnity .Indemnification of the City for work performed pursuant to the License Agreement shall be governed by the terms and provisions of the License Agreement, and not by this Agreement.Each Owner or Associationperforming any work under Sections2.5,2.6,2.7,2.8or 2.9 agrees to indemnify, protect, defend and hold harmless, each Association, the City and the City Indemnified Parties and the Owners of the portion of the Development Parcels upon which any installation, maintenance, repair, replacement or other work is being performed from and against all Claims to the extent arising out of or in connection with activities within the Easement Area by any Owner, WorkingParty any Association and their respective Representatives ("") including, but not limited to (a)the acts or omissions to act of such Working Party arising from the presence, activities or work on or use of the Easements Areas by such Working Party in connection with the installation of any Easement Area Improvements;(b)any act or omission to act of any Owner, anyAssociation and/or its Representatives with respect to the Easement Area, the Easement Areas and/or Easement Area Improvements, (c)entry ontoany ofthe Easement Areas in connection with the activities under Sections2.5, 2.6,2.7, 2.8and2.9above, (d)bodily injury to or death of any person (including without limitation 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 such Working Party; and (e)costs to remove or bond mechanics'liens, stop notices and/or bonded stop notices that are recorded and/or served by contractors, Attachment 21 Flight at Tustin Legacy -Form of Roadway and -11- SMRH:479632046.27Utility Easement Agreement 06131725WR-246894 subcontractors (of all tiers) and suppliers with respect to work performed or caused to be performed by such Owner or Association affecting the Easement Area, the Easement Areasor Easement Area Improvements;provided that such Working Party shall not be responsible for and shall have no obligation to defend or indemnify the City Indemnified Parties to the extent of the gross negligence or willful misconduct of a City Indemnified Party.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 Section, City will notify the Installing Party and the Responsible Party of such Claim or potential Claim within ten (10)business daysfrom receipt of formal written notice of such Claim. Selection of counsel and defense of a Claim shall be conductedin accordance with the provisions of Section10.1 of the DDA. The provisions of this Sectionshall survive termination of this Agreement. Notwithstanding anything to the contrary set forth herein, in no event shall this indemnity apply to or cover any work performed pursuant to the License Agreement. 2.11Limitations on Easement Rights . The easement rights established under this Agreement are subject to the performance and satisfaction of each of the following conditions and covenants. 2.11.1Matters of Record .Each of the easements and licenses granted and reserved hereunder is subject to all covenants, conditions, restrictions, encumbrances, easements, dedications, and rights of way, if any, set forth in any matters of record.Each easement is subject to any Public Access Right granted in a Public Access Declaration. 2.11.2Parking Spaces . The easements for vehicular ingress and egress within the Roadway Easement Area are subject to the rights of the Flight Association to install, operate and control parking spaces within the Roadway Easement Area located on the Phase1 Parcel and, prior to the Phase2 Transfer Date, the Phase2 Parcel. From and after the Phase2 Transfer Date, the easements for vehicular ingress and egress within the Roadway Easement Area that are located on the Phase2 Parcel are subject to the rights of the Phase2 Association to install, operate and control parking spaces within the Roadway Easement Area located on the Phase2 (provided such spaces do not preclude use of the Roadway Easement Area by vehicles for through traffic). The parking within the parking spaces described in this Section2.11.2may be limited by the Phase1 Association or the Phase2 Association (as applicable) to the Owners and Permittees of the respective Association with jurisdiction over such parking spaces. 2.11.3Limitationon Access Rights in Connection with Maintenance and Repair . The easements set forth herein are subject to the rights of the Responsible Party to temporarily close or restrict access to the Maintenance Responsibility Areas, as may be reasonably necessary in connection with theexercise of any construction, maintenance, repair or replacement rights or obligations under this Agreement. The easements established hereunder are further limited by the exercise of any rights relating to any Additional Work. 2.11.4No Interference with Private Drainage Facilities .No Ownerand no Associationshall commit any act that would materially damage or interfere with the operation of the PrivateDrainage Facilities or otherwise cause drainage to occur or flow other than through the Private Drainage Facilities, without the prior consent of the Responsible Party and to the extent affecting the Phase1 Parcel, the Flight Association (if the Flight Association is not the Responsible Party) and to the extent affecting the Phase2 Parcel, the Flight Association if the Phase2 Parcel has been annexed by the Flight Association, or the Phase2 Association if the Phase2 Parcel has not been annexed. 2.12Permitted Use . The Grantee of any easement granted under this Agreement shall use such easement solely for the purposes set forth in this Agreement and for no other purpose whatsoever. Attachment 21 Flight at Tustin Legacy -Form of Roadway and -12- SMRH:479632046.27Utility Easement Agreement 06131725WR-246894 ARTICLE 3 MAINTENANCE OF THE MAINTENANCE RESPONSIBILITY AREAS 3.1Commencement of Maintenance of Maintenance Responsibility Areas . Prior to the Easement Area Improvements Completion Date for the applicable Easement Areas and the assignment to the Responsible Association under Section7.18, the Phase1 Owner shall be the Responsible Party and shall be responsible to maintain the Maintenance Responsibility Areas during the period of construction in accordance with the requirements of the License Agreement. As the Completion of the Easement Area Improvements may occur in one or more Phases, on and after the Easement Area Improvements Completion Datefor any Phaseof the Easement Area Improvements and the assignment to the Responsible Association pursuant to Section7.18of responsibilities for such Phase, the Responsible Association will commence to perform its Maintenance Obligations hereunder for the Maintenance Responsibility Areas so assigned and thereafter shall be the Responsible Party for such Phase. All references below to the Responsible Association mean the Flight Association if the Flight Association is initially acting as the Responsible Association unless and until the occurrence of the Master Association Incorporation Date, at which time it shall mean the Master Association upon assignment of such Maintenance Obligations to the Master Association pursuant to Section7.18. 3.2Maintenance Obligations . The Responsible Party's obligations to maintain the Maintenance Responsibility Areas under this Article3shall include without limitation the obligations described below. All Maintenance Obligations shall be performed in accordance with the Conditions and the Tustin Legacy Specific Plan and consistent with High Quality Standards and so as to ensure the adequate maintenance of all Easement Area Improvements such as not to be detrimental to public health, safety, or general welfare. 3.2.1Roadways . The Responsible Party shall maintain, repair, reseal and replace all paved surfaces of the Roadway Easement Areas as necessary to provide a smooth and evenly covered condition (including any lighting illumination thereof), which work shall include, without limitation, sweeping, resealing and resurfacing and shall stripe any parking spaces located on the Roadway Easement Area. 3.2.2Landscaping . The Responsible Partyshall maintain all Landscape Easement Area which Maintenance Obligations shall include: (a)proper maintenance of all Landscape Easement Area and Landscape Improvements such that they are evenly cut and evenly edged, where appropriate, reasonably free of bare and brown spots, debris, trash, litter, droppings and weeds; (b)maintenance, repair and replacement on a regular schedule of landscaping and irrigation systems and lighting within such Landscape Easement Area; (c)frequent and regular inspection for graffiti or damage or deterioration or failure, and reasonably prompt repair or replacement of all surfaces, fencing, walls, lighted bollards, decorative pavement, equipment, etc., as necessary; (d)fertilizing, irrigating and replacing vegetation, as necessary; (e)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 Standards; (f)regular and even trimming and pruning of all trees and shrubs by a licensed landscape contractor 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 and (g)prompt removal and replacement of all dead plant material with an approved replacement. Unless otherwise approved by the City, theResponsible Partyshall cause all landscaping within each separate Landscape Easement Area to be maintained in a consistent manner so that all landscaping within each Landscape Easement Area is consistent in appearance, regardless of which Development Parcel, or portion thereof, comprises a portion of or is located adjacent to such Landscape Easement Area. 3.2.3Lighting Fixtures . The Responsible Party shall maintain all lighting fixtures within the Easement Areas and ensure such lighting fixtures are properly functioning. Attachment 21 Flight at Tustin Legacy -Form of Roadway and -13- SMRH:479632046.27Utility Easement Agreement 06131725WR-246894 3.2.4Inspections . TheResponsible Party shall perform inspections as may be necessary to ensure the sound condition of the Maintenance Responsibility Areas. 3.2.5Pedestrian Access Areas . The Responsible Party shall maintain the Pedestrian Easement Area in a smooth and level condition. 3.2.6Signage . The Responsible Party shall maintain any directional and other signage within the Maintenance Responsibility Areas for the identification, use and regulation of the Easement Area and Easement Area Improvements. 3.2.7Drainage Facilities .The Responsible Party shall maintain all Private Drainage Facilities located within the Easement Area in good working order, free of debris and obstructions, and in accordance with all Requirements and any water quality management plan and/or O&M Plan approved by the City. The Responsible Party shall periodically inspect the Private Drainage Facilities to ensure they are properly functioning and are accepting and draining water in conformance with all Requirements, the water quality management plan and the O&M Plan, if any approved by the City The Responsible Party shall maintain all low impact development areas in conformance with all Requirements and shall replace filters, fabric and other components of the Private Drainage Facilities as may be reasonably necessary or required to conform to all Requirements and any water quality management plan and/or O&M Plan approved by the City. 3.2.8Graffiti .The Responsible Partyshall ensure there is a regular inspection for graffiti and shall remove all graffiti within forty-eight (48) hours of notification. The Responsible Party shall ensure that there is a regular inspection for deterioration or failure of any of the Maintenance Responsibility Areasand promptly repair or replaces all surfaces, fencing, if any, walls, if any, lighted bollards, decorative pavement etc. as necessaryto ensure that the Maintenance Responsibility Areas comply with the High Quality Standardsand all Requirements. 3.2.9Other Obligations; Maintenance Standard . The Responsible Party shall perform any other maintenance reasonably necessary to ensure the proper maintenance of the Maintenance Responsibility Areas. The Maintenance Responsibility Areas shall be maintained consistent with High Quality Standards. 3.3Performance of Maintenance Obligations . The Responsible Party shall perform the Maintenance Obligations in a good and workmanlike manner and in a lien free condition and in accordance with all Requirements. 3.4City Self-Help Remedies . If the Responsible Party fails to perform the Maintenance Obligations as required under this Article3, the City shall have all of the rights and remedies under Section5.1. 3.5Remedies of Associations . If the Responsible Party is the Master Association and the Master Association fails to perform its Maintenance Obligations hereunder, the Flight Association or Phase2 Association, to the extent provided in the Master Declaration, shall have the remedies set forth in the Master Declaration. If the Responsible Party is the Flight Association, the Owners shall have the remedies set forth in the Flight Declaration. 3.6Duty to Protect Against Mechanics' Liens . In performing its obligations under this Agreement, the Responsible Party shall promptly pay all costs, expenses, liabilities and liens arising out of or in any way connected with the contracts for any service, labor or materials provided or supplied. In performing the Maintenance Obligations or any work relating to the Easement Areas hereunder and in exercising any rights hereunder, each Association, and the Phase1 Owner and each other Owner (for the Contracting Party purposes of this Section3.6, the "," as applicable) shall promptly pay all costs, expenses, liabilities and liens arising out of or in any way connected with contracts for any service, labor or materials provided or supplied to any of the Easement Areas. The Contracting Party shall not cause or Attachment 21 Flight at Tustin Legacy -Form of Roadway and -14- SMRH:479632046.27Utility Easement Agreement 06131725WR-246894 permit any mechanic's lien to be filed against any portion of the Easement Areas for labor or materials alleged to have been furnished or delivered to any Lot of the Contracting Party. If any Contracting Party causes or permits such a lien to be filed, such Contracting Party shall: (a)within thirty(30)days after notice to such Contracting Party either cause the lien to be discharged or post a bond which protects the title of the affected Owners and/or the affected Association; and (b)indemnify, protect, defend and hold harmless the other Owners and their Indemnified Parties and/or the affected Association, as applicable, from any Claims by Contracting Party which may be filed against any of the Easement Areas or the other Owners for such work or services performed or materials supplied by anylien claimants with whom the Contracting Party has contracted or any other Person acting directly or indirectly by, through or under such lien claimants supplying services, labor, materials or equipment.In no event shall the provisions of this Section3.6apply to any actions undertaken by the City under Section5.1of this Agreement. 3.7Expenses . All expenses incurred by the Flight Association in performing the Maintenance Obligations and other obligations hereunder shall be levied and paid in accordance with the Flight Declaration and, after the Master Association Incorporation Date, all expenses incurred by the Master Association in performing the Maintenance Obligations and other obligations hereunder shall be levied and paid in accordance with the Master Declaration. ARTICLE 4 INSURANCE, CASUALTY AND INDEMNITY 4.1Insurance . 4.1.1Requirements .Fromand after the Effective Date, each Responsible Party shall, as to the portions of the Maintenance Responsibility Areas for which it is responsible, procure and maintain, at its own cost, and submit to City at least seven (7)calendar days prior to the commencement of installation of the Easement Area Improvements,evidence of liability and property damage insurance against all claims for injuries against persons or damages to property and against all liability of such Responsible Party or any of its Representatives arising out of or in connection with the presence, activities or work on or use of the Maintenance Responsibility Areas or any act or omission to act of such Responsible Party or any of its Representatives with respect to the Maintenance Responsibility Areas. Allpolicies of liability and property damage insurance shall be primary, and any other insurance, deductible, or self-insurance maintained by City, its elected and appointed officials, agents, representatives and employeesshall not contribute with this primary insurance. Policies shall contain or be endorsed to contain such provisions. Each Responsible Party performing work in the Easement Area or affecting the Easement Area Improvements shall also carry workers' compensation insurance inaccordance with California worker's compensation laws. Each Owner and each Association hereby waives, and agrees to obtain endorsements from its workers' compensation insurer waiving, all subrogation rights under its workers' compensation insurance policy against the City, its elected and appointed officials, agents, representatives and employees, and require each of its subcontractors, if any, and each subcontractor's insurer, to do likewise under their workers' compensation insurance policies. The procuring of such insurance and the delivery of policies or endorsements evidencing the same shall not be construed as a limitation of each Owner's or any Association's obligation to indemnify City and the City Indemnified Parties, as set forth herein. 4.1.2Insurance Amounts . The amount of insurance required hereunder shall include comprehensive general liability, personal injury and automobile liability with limits of at least Two Million dollars ($2,000,000) combined single limit coverage per occurrence, and foreach contractor or subcontractor that is professionally licensed and is engaged to perform professional design or engineering services, professional liability coverage with limits of at least Five Hundred Thousand Dollars ($500,000) and property damage limits of not less than One Million Dollars ($1,000,000) insuring against all liability of each Responsible Party and its Representatives arising out of or in connection with the presence, activities or work on or use of the or any act or omission to act of such Responsible Party and its Representatives with respect to the Easement Area, any of the Easement Areas and/or Easement Attachment 21 Flight at Tustin Legacy -Form of Roadway and -15- SMRH:479632046.27Utility Easement Agreement 06131725WR-246894 Area Improvements. The foregoing minimum amounts of liability and professional liability coverage shall be increased by fifty percent (50%) on each tenth-year anniversary of the Effective Date (compounding each increase), or such lower amount as the City's Risk Manager, in his or her sole discretion, approves in writing. 4.1.3Insurance for Contractors and Subcontractors . In addition, each Responsible Party shall be responsible for causing any contractor or subcontractor installing or doing substantial repair or replacement in any portion of the Easement Area to procure and maintain the same types and amounts of insurance, and in compliance with the terms set forth in this Section4.1.3, including but not limited to endorsing each liability policy with the exception of any professional liability or workers compensation policy to add the City, its elected and appointed officials, agents, representatives and employees as additional insureds to their respective policies. No Responsible Party or any other Owner shall allow any contractor or subcontractor to commence any work or services in any portion of the Easement Areaunless and until it has provided evidence satisfactoryto City that the contractor or subcontractor has secured all insurance required under this Section4.1.3. Each Responsible Party shall monitor and review all such coverage and assumes all responsibility for ensuring thateach contractor's and subcontractor's insurance coverage is provided and maintained in conformity with the requirements of this Section4.1.3. 4.1.4Certificates and Endorsements . Each party responsible to provide insurance pursuant to this Sectionwill furnish to City duly 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 City from 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 ACORD certificate evidencing the foregoing and providing the followingendorsements signed by the authorized representative of the underwriter and approved by City shall be delivered within seven (7)business days following the Effective Date of this Agreement and annually evidencing renewals of each policy. The endorsements shall provide as follows: (a)designate the City, its elected and appointed officials, agents, representatives and employees as additional insureds on the commercial general liability policies; (b)the commercial general liability insurance coverage shall be primary, and not contribute with any insurance or self-insurance maintained by City and (c)a waiver of subrogation for the benefit of the City on all policies with the exception of any professional liability policy required by this Agreement. All such insurance, excluding professional liability 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. 4.1.5DDA Requirements . The foregoing requirements of this Section4.1.5 may be satisfied during the term of the DDA by insurance required by the DDA but shall not subtract from any insurance obligations of Developer or any Successor Owner to City under theDDA. All required insurance shall be kept in effect during the term of this Agreement and shall not be cancelable without thirty (30) days written notice to City of any proposed cancellation. Certificates or endorsements evidencing the foregoing and designating the City, its elected and appointed officials, agents, representatives and employees and volunteers as additional insureds shall be delivered to and approved by City prior to commencement of activities under the Licenses. The procuring of such insurance and the delivery of policies or certificates or endorsements evidencing the same shall not be construed as a limitation of an Owner's or any Association's obligation to indemnify City, and the City Indemnified Parties as set forth herein. 4.2Casualty . In the event there is any damage to any portion of the Easement Areaor the Easement Area Improvementswhich is not covered by the property insurance maintained by the Responsible Party as required under Section4.1, the Responsible Party shall still have the obligation to restore such Easement Area Improvements to the condition existing prior to the casualty. Attachment 21 Flight at Tustin Legacy -Form of Roadway and -16- SMRH:479632046.27Utility Easement Agreement 06131725WR-246894 ARTICLE 5 ENFORCEMENT AND TERMINATION 5.1City Remedies. In the event of a breach of any provision of this Agreement, City Default Notice may demand by written notice issued to the then-Responsible Party(ies) ("") that the violation be cured. Except for utility service interruptions or any other emergencies which threaten imminent damage or injury to persons or property which shall not require advance notice or cure periods hereunder, if the then-Responsible Party(ies) do(es) not cure the violation within thirty (30) days after Non-Curing Party receipt of the Default Notice (each such non-curing Responsible Party, the ""), or if such default is of a kind which cannot reasonably be cured within thirty (30) days, and such Non-Curing Party does not within such thirty (30) day period commence to cure such default and diligently thereafter Event of Default prosecute such cure to completion (""), then City shall have the right, but not the obligation, to (a)institute legal action against such Non-Curing Party for specific performance, injunction, declaratory relief, damages, or any other remedy provided by law, (b)pay any sum owed by such Non- Curing Party to the partyentitled to such payment and/or (c)enter upon the Maintenance Responsibility Areas (and upon the Development Parcels, to the extent reasonably necessary to enforce its rights hereunder)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/or perform any obligation of such Non-Curing Party under this Agreement to be performed. Notwithstanding the time periods set forth above, if the default is of such a kind which threatens immediate damage or injury to persons or property, then the Non-Curing Party shall immediately take such actions to cure the default and if the Non-Curing Party fails to immediately take such actions, the City may take any actions reasonably necessary under the circumstances to prevent further injury or damage. Such Non-Curing Party shall pay to the City, within thirty (30) calendar days of written demand by City (which demand is accompanied by appropriate supporting documentation), an amount equal to all costs and expenses incurred by City in undertaking any of the actions permitted by the preceding sentences, including without limitation, third party costs and City hourly wages and benefits reasonably allocable to the time expended by City in taking 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 by the City. Each Association shall have the rights under its Association Declaration to pursue any remedy against any Owner if the default is caused by such Owner, its Representatives, or its permittees and is hereby authorized (but not required unless the default is preventing the Association from performing its obligations or paying sums due under this Agreement or if the City so requires the Association to pursue its remedies, in which case the Association is required to exercise such rights and remedies to the extent necessary to cause cure of any such default). The rights and remedies given to City by this Agreement shall be deemed to be cumulative and no one of such rights and remedies shall be exclusive of any of the others, or of any other right or remedy at lawor 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'sstanding to exercise any other right or remedy; provided however that the City expressly waives, releases and relinquishes any and all rights to an expectation, anticipation, indirect, consequential, exemplary or punitive damages.In no event shall the City have any responsibility for any liens that may be filed as a result of the work performed by the City hereunder. It shall be the responsibility of the Non-Curing Party to remove or cause the removal of any liens for work performed by the City hereunder provided thatif the Non-Curing Party isthe Responsible Association, then the Responsible Associationshall, for the benefit of the City,pursue its remedies under the applicable Association Declaration against any Association or Owner responsible for the lien having being filed by the City. 5.2Enforcement by Associations and the City . Violation or breach of any covenant, agreement or provision contained herein shall give to any Association, the City, and to the extent a violation affects a particular Owner or Owners under Sections2.8,2.9or 2.10, to such affected Owner or Owners, the right to prosecute a proceeding at law or in equity against the person or persons who violated or are attempting to violate any such covenant, agreement or provision, to enjoin or prevent them from doing so, to cause such violation to be remedied and/or to recover damages for such violation; provided however that any and all rights to any expectation, anticipation, indirect, consequential, exemplary or punitive damages are hereby waived. Attachment 21 Flight at Tustin Legacy -Form of Roadway and -17- SMRH:479632046.27Utility Easement Agreement 06131725WR-246894 5.3Remedies for Non-Payment . If any Owner or Association is in default under this Agreement and any Association incurs any costs and expenses as a result therefor, including as a result of the exercise by the City of its rights and remedies under this Agreement, such costs and expenses incurred by such Association shall be paid to the Association as and when required under the applicable Association Declaration and if such assessments are not paid when due, the applicable Association may pursue, or if the City so requires or if the default is preventing the Association from performing its obligations or paying sums due under this Agreement, the Association shall pursue its remedies under its Association Declaration and failure to do so shall be a default by such Association under this Agreement. Each Owner shall cooperate with the Association and take such actions as are required under the Association Declaration to cause the Association to pursue its remedies and to provide sufficient funding to satisfy the Association's payment obligations under this Agreement. ARTICLE 6 AMENDMENT 6.1Amendment. This Agreement may be amended or modified solely with the prior consent of (a)the City as the owner of all or any portion of Phase2, and following its conveyance of its interests in the Phase2 Parcel, in its governmental capacity, (b)prior to the assignment by the Phase1 Owner of its obligations under this Agreement to Flight Association or any other Association pursuant to Section7.18, Phase1 Owner, and following such assignment, such Association, and to the extent the Phase1 Owner has not assigned all of its obligations, the Phase1 Owner and (c)prior to the assignment by the Owner of the Phase2 Parcel of its obligations under this Agreement to an Association pursuant to Section7.18, such Owner, and following any assignment, bythe Owner of Phase2 Parcel or any Successor Owner of Phase2 to an Association, such Association, and to the extent the Owner of the Phase2 Parcel has not assigned all of its obligations hereunder, the Owner of the Phase2 Parcel,each in its sole discretion. Anychange, modification, amendment or rescission which is made without the written consent of the applicable parties listed above shall be null and void and of no effect. No consent or approval of any Owner other than those parties described in the first sentence of this Section6.1shall be required in order to modify or amend any provisions of this Agreement. Such amendment shall be recorded in the office of the county recorder of Orange County, State of California.Such amendment shall be recorded in the Official Records of the County of Orange, State of California. Further, the parties shall reasonably cooperate with each other to, at the other's request from time to time, amend this Agreement to more accurately reflectthe precise location of the Easement Areas or any one thereofonce the same have been ultimately determined. 6.2Cooperation. If the Phase2 Transfer Date occurs, the Master Association, the Flight Association, the City, the Phase2 Owner and Phase2 Association shall reasonably cooperate with each other to make any modifications to this Agreement as may be required to reflect the development plan for the Phase2 Parcel, but in no event shall the Owner of the Phase 1 Parcel or the Flight Association or any Owner of a Lot within the Phase1Parcel have any obligation for any costs of installation of any Easement Improvements related to such initial installation so long as such improvements are not Minimum Horizontal Improvements as such term is defined in, and as required by the DDA. ARTICLE 7 GENERAL PROVISIONS 7.1Subdivision. In the event that either the Phase1 Parcel or the Phase2 Parcel should be further subdivided, the rights and privileges appurtenant to any such property granted herein shall inure to the benefit of all subdivided or separate portions thereof, and the covenants and obligations burdening any such property shall burden all of the subdivided portions thereof. 7.2Compliance with Requirements . Each Owner and each Association shall comply with all Requirements affecting the Easement Area, the Easement Areasand the Easement Area 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. Attachment 21 Flight at Tustin Legacy -Form of Roadway and -18- SMRH:479632046.27Utility Easement Agreement 06131725WR-246894 The disposal of any toxic or hazardous materials within the Easement Area or any of the Easement Areas is specifically prohibited. No Owner or Association shall discharge waste or effluent from the Easement 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 any Owner to City under the DDA, or, from and after the Phase2 Transfer Date, any environmental responsibilities to the City of the Phase2 Owner and any Successor Owners of any portion of the Phase2 Parcel under any exclusive negotiating agreement, disposition and development agreement, ground lease, or other binding agreement with the City. 7.3Estoppel Certificate . 7.3.1Issuanceby City. From and after the termination of the DDA as to the Maintenance Responsibility Areas (including by issuance of by the City of a Certificate of Compliance with respect to such Development Parcel) (it being understood that prior to such termination, the provisions of DDA Section2.2.6 shall govern City estoppels), the City, hereby covenants that within ten (10)business days of the written request of any other party, issued not more than annually or more often only in connection with a transfer by the requesting party of its interest in any Lot, that it shall issue to the party making the request an estoppel certificate stating: (a)whether the party to whom the request has been directed knows of any default or Event of Default under this Agreement and if there are known defaults or Events of Default specifying the nature thereof; (b)whether to its knowledge this Agreement has been assigned, modified, or amended in any way (and if it has, then stating the nature thereof); and (c)whether to the party's knowledge this Agreement is as of that date in full force and effect. 7.3.2Issuanceby Owners and Associations .Each Owner and each Association hereby covenants thatwithin ten (10)business days of the written request of any other party or the City it will issue to such requesting person an Estoppel Certificate stating: (a)whether the party to whom the request has been directed knows of any default under 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, then stating the nature thereof); and (c)whetherto the party's knowledge this Agreement is as of that date is in full force and effect. 7.4Excuse for Non-Performance .The City and each Owner and each Association 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, including, without limitation, inclement weather, 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. 7.5Effect on Third Parties . Except as herein specifically provided, no rights, privileges or immunities conferred upon the City, each Association and each Owner under this Agreement shall inure to the benefit of any other person or entity nor shall any other person or entity be deemed to be a third party beneficiary of any of the provisions contained herein. 7.6Third Party Beneficiary .The City is intended as a third party beneficiary of this Agreement regardless of whether the City owns any portion of the Phase2 Parcel. 7.7Successors and Assigns. The terms and conditions of this Agreement shall be binding upon and inure to the benefit or burden of the Phase1 Parcel and Phase2 Parcel hereto and their successors and/or assigns who acquire an interest in the Phase1 Parcel and/or the Phase2 Parcel, as applicable. Except as otherwise provided for herein, all references herein to the "Phase1 Owner" and "Phase2 Owner" shall also refer to such successors and assigns. Notwithstanding anything to the contrary contained herein, in no event shall any Association or Owner assign or otherwise transfer any of their interest in and to the Easementsor Easement Areas or any one thereofto any person or entity that Attachment 21 Flight at Tustin Legacy -Form of Roadway and -19- SMRH:479632046.27Utility Easement Agreement 06131725WR-246894 is not acquiring, concurrently therewith, an interest in the Phase1 Parcel or the Phase2 Parcel without the prior written consent of the granting party, which consent may be withheld or given in the granting party's sole and absolute discretion. 7.8Notices. All notices, demands, consents, requests and other communications required or permitted tobe given under this Agreement shall be in writing and shall be deemed conclusively to have been duly given (a)when hand delivered to the City, the applicable Association or Owner; (b)three (3)business days after such notice has been sent by U.S. PostalService via certified mail, return receipt requested, postage prepaid, and addressed to the Owner, the City or the applicable Association as set forth below; (c)the next business day after such notice has been deposited with an overnight delivery servicereasonably approved by 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 Owner, the City or the applicable Association 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 Section7.8other 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 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:Jeffrey C. Parker, City Manager City of Tustin 300 Centennial Way Tustin, CA 92780 Fax: (714) 838-1602 Email: jparker@tustinca.org With a copy to:David Kendig Woodruff Spradlin&Smart, APC 555 Anton Boulevard, #1200 Costa Mesa, CA 92626 Fax: (714) 415-1183 Email: dkendig@wss-law.com Phase1 Owner:David Binswanger and Matt Howell Flight Venture LLC c/o Lincoln Property Company Commercial, Inc. 915 Wilshire Boulevard, Suite2050 LosAngeles, CA 90017 Fax: (213) 538-0901 Email:dbinswanger@lpc.comand matt.howell@lpc.com With a copy to:Parke Miller Lincoln Property Company Commercial, Inc. 114 Pacifica, Suite370 Irvine, CA 92618 Fax: (949) 333-2131 Email: pmiller@lpc.com Attachment 21 Flight at Tustin Legacy -Form of Roadway and -20- SMRH:479632046.27Utility Easement Agreement 06131725WR-246894 With a copy to:Gregory S. Courtwright Lincoln Property Company Commercial, Inc. 2000 McKinney Avenue, Suite1000 Dallas, TX 75201 Fax: (214) 740-3460 Email: gcourtwright@lpc.com With a copy to:Mark Potter Alcion Ventures One Post Office Square, Suite3150 Boston, MA 02109 Fax: (617) 603-1001 E-mail: mpotter@alcionventures.com With a copy to:Amy Forbes and Douglas Champion Gibson, Dunn&Crutcher LLP 333 South Grand Avenue, Suite4900 LosAngeles, CA 90071 Fax: (213) 229-6151 / (213) 229-6128 E-mail: aforbes@gibsondunn.com/ dchampion@gibsondunn.com With a copy to:Andrew C. Sucoff Goodwin Procter LLP 100 Northern Ave. Boston, MA 02210 Fax: (617) 523-1231 Email:asucoff@goodwinlaw.com All notices to any Association shall be delivered to the address specified in a written notice to the Responsible Association or if no address is specified to the person delegated as the agent for service of process for the applicable Association. Any party may by written notice to the other party in the manner specified in this Agreement change the address to which notices to such party shall be delivered; provided that notwithstanding any other provision of this Agreement to the contrary, City shall be entitled to deliver notices to any Association then formed to the address for such Association contained in the Association Declaration or amendment thereto last recordedin the Official Recordsand no change to the name or address of any Association shall be deemed effective or binding on the City unless it is contained in a recorded Declaration or amendment thereof with a copy delivered to the City Clerk and to the City in accordance with this Section7.8,or if no address is specified to the person delegated as the agent for service of process for the applicable Association. 7.9Covenant of Further Assurances. The Parties hereby agree to execute such other documents and perform such other acts as may be reasonably necessary or desirable to carry out the purposes of this Agreement. 7.10Partial Invalidity. If any term, covenant or condition of this Agreement or its application to any persons or circumstances shall be held to be invalid or unenforceable, the remainder of this Agreement and the application of such term or provision to other persons or circumstances shall not be effected, and each term hereof shall be valid and enforceable to the fullest extent permitted by law. 7.11Not a Public Dedication. Nothing contained in this Agreement shall be deemed to be a gift or dedication of any portion of the Development Parcels to or for the general public or for any public purpose. Attachment 21 Flight at Tustin Legacy -Form of Roadway and -21- SMRH:479632046.27Utility Easement Agreement 06131725WR-246894 7.12Severability . 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. 7.13Governing Law. This Agreement is entered into and shall be governed by and construed in accordance with the laws of the State of California. Venue for any action brought to enforce or interpret the terms of this Agreement shall be in the County of Orange, California. 7.14Waiver and Default. The waiver by anOwner, any Association, and/or the Cityof 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. 7.15References to Sections, Clauses and Exhibits . Unless otherwise indicated, references in this Agreement to sections, clauses and exhibits are to the same contained in or attached to this Agreement and all exhibits referenced in this Agreement are incorporated in thisAgreement by this reference as though fully set forth in this Section.All depictions on Exhibit"B-1"andExhibit"B-2"are attached as pictorial illustrations of the approximate locations of certain areas within the Easement Area. In the event of any conflict between the pictorial illustrations on Exhibit"B-1"and/or Exhibit"B-2"and the actual locations, the actual locations shall control. 7.16Counterparts. This Agreement may be executed in any number of original counterparts, all of which evidence only one agreement, binding on all parties, even though all parties are not signatories to the same counterpart. 7.17Runs With the Land; Release and Termination . This Agreement and the agreements, rights, covenants, conditions contained herein, shall constitute equitable servitudes and covenants running with the land comprising the Development Parcels (collectively, the "Parcels") and each and every portion thereof and shall be binding upon or inure to the benefit of (as the case may require) the parties hereto, and their respective heirs, successors, and assigns who become owners of the Parcels or any one thereof from time to time, and all other persons acquiring their respective Parcels or any part thereof, whether by operation of law or in any other manner whatsoever and shall continue to be imposed upon the Parcels and each portion thereof as a servitude in favor of each and every other portion of the Parcels, as the dominant tenement or tenements, as the case may be. 7.18Assignment .The Phase1 Owner shall have the right to assignits duties, obligations and liabilities under this Agreement to the Responsible Associationeither in full or with respect to certain phases or portions of the Maintenance Responsibility Areas upon completion of initial installationof the Easement Area Improvements in such Maintenance Responsibility Areas.If the Phase2 Transfer Date occurs and the Responsible Association is the Flight Association, the Flight Association shall assign its duties, obligations and liabilities with respect to the Maintenance Responsibility Areas under this Agreement to the Master Association and the Master Association shall assume such obligations under this Agreement. If the City exercises its rights to incorporate the Master Association as a result of a Flight Association Event of Default then all of the duties, obligations and liabilities of the Flight Association shall be automatically assigned to and shall be assumed by the Master Association.Prior to any assignment by the Phase1 Owner to a Responsible Association, each of the Owners hereunder shall have joint and several liability for the obligations under this Agreement. So long as the Association to which the rights and obligations hereunder are assigned has the power to perform the obligations hereunder including the power to levy liens pursuant to its Association Declaration and has the duty and the power, on behalf of itself and the City to enforce the performance and payment obligations hereunder and so long as such assignment shall be accomplished through the recordation of an assignment and assumption instrument which shall clearly set forth those portions of the Maintenance Responsibility Areasto which such assignment appliesand shall contain an assumption by the Responsible Associationof the obligations and liabilities under this Agreement with respect to such Attachment 21 Flight at Tustin Legacy -Form of Roadway and -22- SMRH:479632046.27Utility Easement Agreement 06131725WR-246894 portions of theapplicable Maintenance Responsibility Areasarising from and after the date of the Assignment Agreement assignment ("")then, in such case the assigning Owner withrespect to any assignment to the Responsible Association, and the Flight Association (if it has been assigned the obligations hereunder by the Phase1 Owner) with respect to an assignment to the Master Association (if applicable) except as otherwise specifically set forth herein shall be released from all obligations and liabilities underthis Agreement arising or accruing under this Agreement from and after the effective date of the applicable assignment with respect to those portions of the Maintenance Responsibility Areasand those obligations and liabilities which are subject to the Assignment Agreement. IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date and year first above written. PHASE 1 OWNER : Flight PhaseI Owner LLC, a Delaware limited liability company By:___________________________________ Name: Title: Attachment 21 Flight at Tustin Legacy -Form of Roadway and -23- SMRH:479632046.27Utility Easement Agreement 06131725WR-246894 A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. STATE OF ________________________) COUNTY OF ______________________) On ___________________, 201__, before me, _____________________, a Notary Public, personally appeared ______________, 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 executed the same in his authorized capacity, and that by his 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 paragraphis true and correct. WITNESS my hand and official seal. Signature _______________________________ (Seal Flight at Tustin Legacy -Form of Roadway and SMRH:479632046.27Utility Easement Agreement 06131725WR-246894 PHASE 2 OWNER: City of Tustin, a municipal corporation of the State of California Dated: ____________________________By: _________________________________ Jeffrey C. Parker City Manager ATTEST: By: ______________________________ City Clerk APPROVED AS TO FORM By:______________________________ David Kendig, City Attorney Armbruster Goldsmith&Delvac LLP Special Real Estate Counsel By: ______________________________ Amy E. Freilich Dated: ___________________________ [[864,2075,1724,2123][10][,I,][Arial]][Notary block appears on the following page] A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. STATE OF CALIFORNIA) COUNTY OF __________________) On ___________________, 2017, before me, _____________________, a Notary Public, personally appeared ______________, 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 executed the same in his authorized capacity, and that by his 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 paragraphis true and correct. WITNESS my hand and official seal. Signature _______________________________ (Seal) A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. STATE OF CALIFORNIA) COUNTY OF __________________) On ___________________, 2017, before me, _____________________, a Notary Public, personally appeared ______________, 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 executed the same in his authorized capacity, and that by his signature on the instrument the person, or the entity upon behalf of whichthe person acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraphis true and correct. WITNESS my hand and official seal. Signature _______________________________ (Seal) A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. STATE OF CALIFORNIA) COUNTY OF __________________) On ___________________, 2017, before me, _____________________, a Notary Public, personally appeared ______________, 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 executed the same in his authorized capacity, and that by his 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 paragraphis true and correct. WITNESS my hand and official seal. Signature _______________________________ (Seal) LIST OF EXHIBITS EXHIBIT "A-1"................................................................................Legal Description of Phase1Parcel EXHIBIT "A-2"................................................................................Legal Description of Phase2 Parcel EXHIBIT "A-3"............................................................Depiction of Phase1 Parcel and Phase2 Parcel EXHIBIT "B-1"............................................................................Depiction of Roadway Easement Area EXHIBIT "B-2"....................................................................................................Depiction of Pedestrian Easement Area and Landscape Easement Area EXHIBIT "B-3"...............................................................................Legal Description of Easement Area EXHIBIT "C"......................................................Form of Master Declaration Establishing Maintenance and Cost Sharing Obligations for Tustin Legacy Cornerstone I Flight at Tustin Legacy -Form of Roadway and EXHIBIT "A-1" SMRH:479632046.27Utility Easement Agreement 06131725WR-246894 EXHIBIT "A-1" LEGAL DESCRIPTION OF PHASE1 PARCEL Legal Description (Phase 1) Real property in the City of Tustin, County of Orange, State of California, described as follows: LOTS 1 THROUGH 10, INCLUSIVE, OF TRACT NO. 18082, AS SHOWN BY TRACT MAP ON FILE IN BOOK _____, PAGES _____, INCLUSIVE, OF TRACT MAPS, RECORDS OF ORANGE COUNTY, CALIFORNIA. EXCEPTING THEREFROM ANY AND ALL OIL, OIL RIGHTS, MINERALS, MINERAL RIGHTS, NATURAL GAS, NATURAL GAS RIGHTS AND OTHER HYDROCARBONS BY WHATSOEVER NAME KNOWN, GEOTHERMAL STEAM AND ALL PRODUCTS DERIVED FROM ANY OF THE FOREGOING THAT MAY BE WITHIN OR UNDER THE LAND, TOGETHER WITH THE PERPETUAL RIGHT OF DRILLING, MINING, EXPLORING FOR AND STORING IN AND REMOVING THE SAME FROM THE LAND OR ANY OTHER LAND, INCLUDING THE RIGHT TO WHIPSTOCK OR DIRECTIONALLY DRILL AND MINE FROM LANDS OTHER THAN THE LAND, OIL OR GAS WELLS, TUNNELS AND SHAFTS INTO, THROUGH OR ACROSS THE SUBSURFACE OF THE LAND 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 LAND IN THE EXERCISE OF SUCH RIGHTS OR OTHERWISE ADVERSELY AFFECT THE USE OR OPERATION OF THE LAND OR THE STRUCTURAL INTEGRITY OF ANY IMPROVEMENTS ON THE LAND, AS RESERVED IN THE QUITCLAIM DEED FROM THE CITY OF TUSTIN, CALIFORNIA, RECORDED ________, 2017 AS INSTRUMENT NO. __________________ OF OFFICIAL RECORDS. ALSO EXCEPTING THEREFROM ANY AND ALL WATER, WATER RIGHTS OR INTERESTS THEREIN APPURTENANT OR RELATING TO THE LAND OR OWNED OR USED BY THE GRANTOR IN CONNECTION WITH OR WITH RESPECT TO THE LAND NO MATTER HOW ACQUIRED BY THE GRANTOR, 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 LAND, TO STORE THE SAME BENEATH THE SURFACE OF THE LAND AND TO DIVERT OR OTHERWISE UTILIZE SUCH WATER, RIGHTS OR INTERESTS ON ANY OTHER PROPERTY OWNED OR LEASED BY GRANTOR; BUT WITHOUT, HOWEVER, THE RIGHT TO ENTER UPON OR USE THE SURFACE OF THE LAND IN THE EXERCISE OF SUCH RIGHTS OR OTHERWISE ADVERSELY AFFECT THE USE OR OPERATION OF THE LAND OR THE STRUCTURAL INTEGRITY OF ANY IMPROVEMENTS ON THE LAND, AS RESERVED Flight at Tustin Legacy -Form of Roadway and EXHIBIT "A-1" SMRH:479632046.27Utility Easement Agreement 06131725WR-246894 IN THE QUITCLAIM DEED FROM THE CITY OF TUSTIN, CALIFORNIA, RECORDED ___________, 2017 AS INSTRUMENT NO. _______________ OF OFFICIAL RECORDS. Flight at Tustin Legacy -Form of Roadway and EXHIBIT "A-1" SMRH:479632046.27Utility Easement Agreement 06131725WR-246894 EXHIBIT "A-2" LEGAL DESCRIPTION OF PHASE2 PARCEL Legal Description (Phase 2) Real property in the City of Tustin, County of Orange, State of California, described as follows: PARCEL 2 OF PARCEL MAP NO. 2015-168, AS SHOWN ON A MAP FILED IN BOOK 388, PAGES 26 AND 27 OF PARCEL MAPS, RECORDS OF ORANGE COUNTY, CALIFORNIA; EXCEPTING THEREFROM ANY AND ALL OIL, OIL RIGHTS, MINERALS, MINERAL RIGHTS, NATURAL GAS, NATURAL GAS RIGHTS AND OTHER HYDROCARBONS BY WHATSOEVER NAME KNOWN, GEOTHERMAL STEAM AND ALL PRODUCTS DERIVED FROM ANY OF THE FOREGOING THAT MAY BE WITHIN OR UNDER THE LAND, TOGETHER WITH THE PERPETUAL RIGHT OF DRILLING, MINING, EXPLORING FOR AND STORING IN AND REMOVING THE SAME FROM THE LAND OR ANY OTHER LAND, INCLUDING THE RIGHT TO WHIPSTOCK OR DIRECTIONALLY DRILL AND MINE FROM LANDS OTHER THAN THE LAND, OIL OR GAS WELLS, TUNNELS AND SHAFTS INTO, THROUGH OR ACROSS THE SUBSURFACE OF THE LAND 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 RIGHTTO ENTER UPON OR USE THE SURFACE OF THE LAND IN THE EXERCISE OF SUCH RIGHTS OR OTHERWISE ADVERSELY AFFECT THE USE OR OPERATION OF THE LAND OR THE STRUCTURAL INTEGRITY OF ANY IMPROVEMENTS ON THE LAND. ALSO EXCEPTING THEREFROM ANY AND ALL WATER, WATER RIGHTS OR INTERESTS THEREIN APPURTENANT OR RELATING TO THE LAND OR OWNED OR USED BY THE GRANTOR IN CONNECTION WITH OR WITH RESPECT TO THE LAND NO MATTER HOW ACQUIRED BY THE GRANTOR, 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 LAND, TO STORE THE SAME BENEATH THE SURFACE OF THE LAND AND TO DIVERT OR OTHERWISE UTILIZE SUCH WATER, RIGHTS OR INTERESTS ON ANY OTHER PROPERTY OWNED OR LEASED BY GRANTOR; BUT WITHOUT, HOWEVER, THE RIGHT TO ENTER UPON OR USE THE SURFACE OF THE LAND IN THE EXERCISE OF SUCH RIGHTS OR OTHERWISE ADVERSELY AFFECT THE USE OR OPERATION OF THE LAND OR THE STRUCTURAL INTEGRITY OF ANY IMPROVEMENTS ON THE LAND. Flight at Tustin Legacy -Form of Roadway and EXHIBIT "A-2" SMRH:479632046.27Utility Easement Agreement 06131725WR-246894 Flight at Tustin Legacy -Form of Roadway and EXHIBIT "A-2" SMRH:479632046.27Utility Easement Agreement 06131725WR-246894 EXHIBIT "A-3" DEPICTION OF PHASE 1 PARCEL AND PHASE 2 PARCEL [See Attached] All items and location of items are shown for informational purposes only and should not be relied upon for content, precise design or dimension.The actual conditions will control.The attached Site Plan is for illustrative purposes only and depicts approximate dimensions. Flight at Tustin Legacy -Form of Roadway and EXHIBIT "A-3" SMRH:479632046.27Utility Easement Agreement 06131725WR-246894 Flight at Tustin Legacy -Form of Roadway and EXHIBIT "A-3" SMRH:479632046.27Utility Easement Agreement 06131725WR-246894 EXHIBIT "B-1" DEPICTION OF ROADWAY EASEMENT AREA [See Attached] All items and location of items are shown for informational purposes only and should not be relied upon for content, precise design or dimension.The actual conditions will control.The attached Site Plan is for illustrative purposes only and depicts approximate dimensions. Flight at Tustin Legacy -Form of Roadway and EXHIBIT "B-1" SMRH:479632046.27Utility Easement Agreement 06131725WR-246894 Flight at Tustin Legacy -Form of Roadway and EXHIBIT "B-1" SMRH:479632046.27Utility Easement Agreement 06131725WR-246894 Flight at Tustin Legacy -Form of Roadway and EXHIBIT "B-1" SMRH:479632046.27Utility Easement Agreement 06131725WR-246894 EXHIBIT "B-2" PEDESTRIAN EASEMENT AREA AND LANDSCAPE EASEMENT AREA [See Attached] All items and location of items are shown for informational purposes only and should not be relied upon for content, precise design or dimension.The actual conditions will control.The attached Site Plan is for illustrative purposes only and depicts approximate dimensions. Flight at Tustin Legacy -Form of Roadway and EXHIBIT "B-2” SMRH:479632046.27Utility Easement Agreement 06131725WR-246894 Flight at Tustin Legacy -Form of Roadway and EXHIBIT "B-2” SMRH:479632046.27Utility Easement Agreement 06131725WR-246894 Flight at Tustin Legacy -Form of Roadway and EXHIBIT "B-2” SMRH:479632046.27Utility Easement Agreement 06131725WR-246894 EXHIBIT "B-3" LEGAL DESCRIPTIONOF EASEMENT AREA [See Attached] Flight at Tustin Legacy -Form of Roadway and EXHIBIT "B-3” SMRH:479632046.27Utility Easement Agreement 06131725WR-246894 -1- Flight at Tustin Legacy -Form of Roadway and EXHIBIT "B-3” SMRH:479632046.27Utility Easement Agreement 06131725WR-246894 -2- Flight at Tustin Legacy -Form of Roadway and EXHIBIT "B-3” SMRH:479632046.27Utility Easement Agreement 06131725WR-246894 -3- Flight at Tustin Legacy -Form of Roadway and EXHIBIT "B-3” SMRH:479632046.27Utility Easement Agreement 06131725WR-246894 -4- Flight at Tustin Legacy -Form of Roadway and EXHIBIT "B-3” SMRH:479632046.27Utility Easement Agreement 06131725WR-246894 -5- Flight at Tustin Legacy -Form of Roadway and EXHIBIT "B-3” SMRH:479632046.27Utility Easement Agreement 06131725WR-246894 -6- Flight at Tustin Legacy -Form of Roadway and EXHIBIT "B-3” SMRH:479632046.27Utility Easement Agreement 06131725WR-246894 -7- Flight at Tustin Legacy -Form of Roadway and EXHIBIT "B-3” SMRH:479632046.27Utility Easement Agreement 06131725WR-246894 -8- Flight at Tustin Legacy -Form of Roadway and EXHIBIT "B-3” SMRH:479632046.27Utility Easement Agreement 06131725WR-246894 -9- Flight at Tustin Legacy -Form of Roadway and EXHIBIT "B-3” SMRH:479632046.27Utility Easement Agreement 06131725WR-246894 -10- Flight at Tustin Legacy -Form of Roadway and EXHIBIT "B-3” SMRH:479632046.27Utility Easement Agreement 06131725WR-246894 -11- Flight at Tustin Legacy -Form of Roadway and EXHIBIT "B-3” SMRH:479632046.27Utility Easement Agreement 06131725WR-246894 -12- EXHIBIT "C" FORM OF MASTER DECLARATION ESTABLISHING MAINTENANCE AND COST SHARING OBLIGATIONS FOR TUSTIN LEGACY CORNERSTONE I [See Attached] Flight at Tustin Legacy -Form of Roadway and EXHIBIT "C" SMRH:479632046.27Utility Easement Agreement 06141725WR-246894 RECORDING REQUESTED BY: WHEN RECORDED MAIL TO: Sheppard, Mullin, Richter&Hampton LLP 501 W. Broadway, 19th Floor SanDiego, CA 92101 Attn: Nancy T. Scull, Esq. ABOVE SPACE FOR RECORDER'S USE MASTER DECLARATION ESTABLISHING MAINTENANCE AND COST SHARING OBLIGATIONS FOR TUSTIN LEGACY CORNERSTONEI SMRH:481911721.23Master Declaration for Tustin Legacy Cornerstone I 06141725WR-246894 TABLE OF CONTENTS Page ARTICLE1 DEFINITIONS............................................................................................................................3 1.1 "Additional Charges"......................................................................................................3 1.2 "Airship Avenue"............................................................................................................3 1.3 "Allocable Share"...........................................................................................................3 1.4 "Annual Budget".............................................................................................................4 1.5 "Applicable Laws"...........................................................................................................4 1.6 "Assessment Commencement Date".............................................................................4 1.7 "Assessment"or "Assessments"....................................................................................4 1.8 "Association"..................................................................................................................4 1.9 "Association Declaration"...............................................................................................4 1.10 "Authorized Users".........................................................................................................4 1.11 "Business Day(s)"..........................................................................................................4 1.12 "Casualty".......................................................................................................................4 1.13 "Certificate of Compliance"............................................................................................4 1.14 "City"...............................................................................................................................4 1.15 "City Indemnified Parties"...............................................................................................4 1.16 "City Landscape Areas".................................................................................................5 1.17 "Claims"..........................................................................................................................5 1.18 "Commercial and Industrial CID Act".............................................................................5 1.19 "Compliance Assessments"...........................................................................................5 1.20 "County".........................................................................................................................5 1.21 "Covered Property"........................................................................................................5 1.22 "DDA".............................................................................................................................5 1.23 "Default Interest Rate"....................................................................................................5 1.24 "Development Agreement".............................................................................................5 1.25 "Director"........................................................................................................................5 1.26 "Emergency"...................................................................................................................5 1.27 "Entitlements and Conditions"........................................................................................5 1.28 "Final Map".....................................................................................................................5 1.29 "First Mortgage"..............................................................................................................5 1.30 "First Mortgagee"...........................................................................................................6 1.31 "Fiscal Year"...................................................................................................................6 1.32 "Flight Association"........................................................................................................6 1.33 "Flight Association Event of Default"..............................................................................6 1.34 "Flight Association Governed Property".........................................................................6 1.35 "Flight Board".................................................................................................................6 1.36 "Flight Declaration".........................................................................................................6 1.37 "Flight Way"....................................................................................................................6 1.38 "Governmental Authority"...............................................................................................6 1.39 "Ground Lease"..............................................................................................................6 1.40 "Incorporating Party"......................................................................................................6 1.41 "Indemnified Parties"......................................................................................................6 1.42 "Land Area"....................................................................................................................6 1.43 "Landscape Agreement Maintenance Areas"................................................................6 1.44 "Landscape Easement Area".........................................................................................7 1.45 "Landscape Improvements"...........................................................................................7 1.46 "Landscape Installation and Maintenance Agreement".................................................7 1.47 "Lease"...........................................................................................................................7 1.48 "Lessee".........................................................................................................................7 1.49 "Lot"................................................................................................................................7 1.50 "Maintenance"................................................................................................................7 1.51 "Maintenance Obligations".............................................................................................7 -i- SMRH:481911721.23Master Declaration for Tustin Legacy Cornerstone I 06141725WR-246894 1.52 "Major Decision"or "Major Decisions"...........................................................................7 1.53 "Majority Land Area Association....................................................................................7 1.54 "Master Association"......................................................................................................7 1.55 "Master Association Articles".........................................................................................7 1.56 "Master Association Bylaws"..........................................................................................7 1.57 "Master AssociationGoverning Documents".................................................................7 1.58 "Master Association Incorporation Date".......................................................................7 1.59 "Master Association Incorporation Event"......................................................................8 1.60 "Master Association Maintenance Areas"......................................................................8 1.61 "Master Board"...............................................................................................................8 1.62 "Master Declaration"......................................................................................................8 1.63 "Member"or "Members".................................................................................................8 1.64 "Mortgage"......................................................................................................................8 1.65 "Mortgagee"....................................................................................................................8 1.66 "Notice of Delinquent Assessments"..............................................................................8 1.67 "Official Records"...........................................................................................................8 1.68 "Operational Dispute".....................................................................................................8 1.69 "Operational Dispute Notice"..........................................................................................8 1.70 "Option"..........................................................................................................................8 1.71 "Optionee"......................................................................................................................8 1.72 "Owner"..........................................................................................................................9 1.73 "Parcels".........................................................................................................................9 1.74 "Pedestrian Easement Area"..........................................................................................9 1.75 "Perimeter Landscape Area"..........................................................................................9 1.76 "Permittees"....................................................................................................................9 1.77 "Person".........................................................................................................................9 1.78 "Phase"...........................................................................................................................9 1.79 "Phase1 Landscape Area.............................................................................................9 1.80 "Phase1 Owner"............................................................................................................9 1.81 "Phase1 Parcel"............................................................................................................9 1.82 "Phase2 Association"....................................................................................................9 1.83 "Phase2 Association Governed Property"....................................................................9 1.84 "Phase2 Declaration"....................................................................................................9 1.85 "Phase2 Landscape Area"..........................................................................................10 1.86 "Phase2 Owner"..........................................................................................................10 1.87 "Phase2 Parcel"..........................................................................................................10 1.88 "Phase2 Transfer Date"..............................................................................................10 1.89 "Private Drainage Easement Area"..............................................................................10 1.90 "Project Requirements"................................................................................................10 1.91 "Public Access Right"...................................................................................................10 1.92 "Public Access Declaration".........................................................................................10 1.93 "Record","Recording"and "Recorded"........................................................................10 1.94 "Regular Assessments"................................................................................................10 1.95 "Responsible Association"...........................................................................................11 1.96 "Roadway and Landscape Agreements".....................................................................11 1.97 "Roadway and Landscape Agreements Improvements".............................................11 1.98 "Roadway and Utility Agreement"................................................................................11 1.99 "Roadway and Utility Agreement Maintenance Area Improvements"..........................11 1.100 "Roadway and Utility Agreement Easement Areas"....................................................11 1.101 "Roadway Easement Area"..........................................................................................11 1.102 "Shared Expenses"......................................................................................................11 1.103 "Site Plan"....................................................................................................................12 1.104 "Special Assessments"................................................................................................12 1.105 "Supplemental Declaration".........................................................................................12 1.106 "Utility Easement Area"................................................................................................12 -ii- SMRH:481911721.23Master Declaration for Tustin Legacy Cornerstone I 06141725WR-246894 ARTICLE2 EASEMENTS. LICENSES AND PARKING AND USE RESTRICTIONS................................13 2.1 Ownership and Easements..........................................................................................13 2.2 Parking Rights within the Shared Roadways...............................................................13 2.3 Exercise of Easement andLicense Rights..................................................................13 ARTICLE3 MASTER ASSOCIATION INCORPORATION DATE AND ESTABLISHMENT OF MASTER ASSOCIATION AND PHASE 2 ASSOCIATION..........................................13 3.1 Procedure for Incorporation of the Master Association................................................13 3.2 Actions to Be Taken After the Master Association Incorporation Date........................15 3.3 Membership.................................................................................................................15 3.4 Voting Power................................................................................................................15 3.5 Master Board................................................................................................................15 3.6 Major Decisions............................................................................................................15 3.7 Powers of the Master Association................................................................................16 3.8 Duties of the Master Association.................................................................................16 3.9 Personal Liability..........................................................................................................17 3.10 Establishment of Phase2 Association.........................................................................17 ARTICLE4 MAINTENANCE.......................................................................................................................18 4.1 Maintenance Standards...............................................................................................18 4.2 Maintenance Obligations..............................................................................................18 4.3 Rights to Take-Over Maintenance Obligations............................................................18 4.4 Duty to Protect Against Mechanics'Liens....................................................................18 ARTICLE5 ASSESSMENTS AND LIENS..................................................................................................19 5.1 Creation of Obligation for Assessments.......................................................................19 5.2 Purpose of Assessments.............................................................................................20 5.3 Commencement of Assessments................................................................................20 5.4 Master Association Annual Budget..............................................................................20 5.5 Assessments................................................................................................................20 5.6 Allocation of Assessments...........................................................................................21 5.7 Notice and Assessment Installment Due Dates...........................................................21 5.8 Additional Charges.......................................................................................................21 5.9 Collection of Assessments...........................................................................................22 5.10 Collection of Assessments and Remedies...................................................................22 5.11 Inspection of Master Association Books and Records.................................................24 5.12 Additional Charges.......................................................................................................24 5.13 Subordination of Lien to First Mortgages.....................................................................24 5.14 No Offsets....................................................................................................................24 ARTICLE6 INSURANCE AND CASUALTY...............................................................................................24 6.1 Insurance Under the Roadway and Landscape Agreements......................................24 6.2 Additional Insurance.....................................................................................................24 6.3 MasterBoard's Authority to Revise Insurance Requirements.....................................25 6.4 Casualty.......................................................................................................................25 6.5 Indemnity......................................................................................................................25 ARTICLE7 RIGHTS OF MORTGAGEES..................................................................................................26 7.1 Conflict.........................................................................................................................26 7.2 Subordination of Lien to First Mortgages; Liability for Unpaid Assessments...............26 7.3 Rights on Default..........................................................................................................26 -iii- SMRH:481911721.23Master Declaration for Tustin Legacy Cornerstone I 06141725WR-246894 ARTICLE8 AMENDMENTS.......................................................................................................................26 8.1 Amendments................................................................................................................26 8.2 City's Consent..............................................................................................................26 8.3 Cooperation..................................................................................................................26 8.4 Relianceon Amendments............................................................................................27 ARTICLE9 TERM AND ENFORCEMENT.................................................................................................27 9.1 Term.............................................................................................................................27 9.2 Enforcement and Nonwaiver........................................................................................27 9.3 Operational Disputes....................................................................................................29 9.4 General Enforcement by the City.................................................................................30 ARTICLE10 COVENANTS OF COOPERATION AND ADDITIONAL COVENANTS................................30 10.1 No Racial Restriction....................................................................................................30 10.2 Good Faith and Cooperation........................................................................................30 10.3 Estoppel Certificates....................................................................................................30 10.4 Reasonable Consents..................................................................................................30 10.5 Requirements for Consent...........................................................................................31 10.6 Master Association Limitation on Liability....................................................................31 ARTICLE11 GENERAL PROVISIONS......................................................................................................31 11.1 Excuse for Non-Performance.......................................................................................31 11.2 Effect on Third Parties..................................................................................................31 11.3 City as Third Party Beneficiary.....................................................................................31 11.4 Headings......................................................................................................................31 11.5 Cumulative Remedies; No Waiver...............................................................................31 11.6 Liberal Construction.....................................................................................................31 11.7 Notice...........................................................................................................................31 11.8 Joint and Several Liability............................................................................................33 11.9 Number; Gender..........................................................................................................33 11.10 Effect of DDA...............................................................................................................33 11.11 Statutory References...................................................................................................33 11.12 Applicable Laws...........................................................................................................33 11.13 Partial Invalidity............................................................................................................33 11.14 Governing Law.............................................................................................................34 11.15 Waiver and Default.......................................................................................................34 11.16 References to Sections, Clauses and Exhibits............................................................34 -iv- SMRH:481911721.23Master Declaration for Tustin Legacy Cornerstone I 06141725WR-246894 MASTER DECLARATION ESTABLISHING MAINTENANCE AND COST SHARING OBLIGATIONS FOR TUSTIN LEGACY CORNERSTONEI THIS MASTER DECLARATION ESTABLISHING MAINTENANCE AND COST SHARING Master Declaration OBLIGATIONS FOR TUSTIN LEGACY CORNERSTONEI ("") is made and executed as of _______________, 201__, by Flight PhaseI Owner LLC, a Delaware limited liability company Phase1 OwnerCity (""), and the City of Tustin, a municipal corporation (""), with reference to the facts set forth below. RECITALS All initially capitalized terms used but not defined in the Recitals shall have the meanings set forth in Article1. Description of the Covered Property A.. Phase1 Owner is the Owner of that certain real property described on Exhibit"A"attached hereto and generally depicted on the Site Plan attached hereto asExhibit"B"as the "Phase1 Parcel". The City is the owner of fee title to that certain real property described on Exhibit"C"attached hereto and generally depicted on the Site Plan as the "Phase2 Parcel" and the Perimeter Landscape Area (as defined below). The Phase1 Parcel, the Phase2 Parcel and the Perimeter Landscape Area are sometimes referred to collectively herein as the "Covered Property", provided that from and after the termination by the City of the Landscape Installation and Maintenance Agreement with respect to the Perimeter Landscape Area or the license granted therein for the Perimeter Landscape Area, the Covered Property shall be comprised solely of the Phase1 Parcel and the Phase2 Parcel. A Final Map has been recorded against the Phase1 Parcel subdividing the Phase1 Parcel into Lots as depicted on the Final Map. Maintenance Obligations for Roadway and Utility Agreement Easement Areas B.. Some of the Lots within the Phase1 Parcel and the Phase2 Parcel consist of portions of roadways known as "Flight Way" and "Airship Avenue" which are generally depicted on the Site Plan. The Roadway Easement Area and Pedestrian Easement Area are subject to a right of public access for the benefit of the City and thepublic set forth with respect to the portions thereof located on the Phase1 Parcel, on the Final Map Recorded against the Phase1 Parcel, and with respect to the portions thereof located on the Phase2 Parcel, in the Public Access Declaration and as may be described on a Final Map Recorded against the Phase2 Parcel. Pursuant to the Project Requirements, Phase1 Owner and the City entered into a Roadway and Utility Agreement which (a)established easements for: (i)bicycle and vehicular ingress and egress upon, over and across Flight Way and Airship Avenue and for the maintenance of such roadways, which areas are referred to in the Roadway and Utility Agreement as the "Roadway Easement Area", (ii)pedestrian ingress and egress upon, over, and across certain walkways and pathways and for the maintenance of such walkways and pathwaysupon, over and across portions of the Parcels referred to in the Roadway and Utility Agreement as the "Pedestrian Easement Area," (iii)installing, maintaining and suing landscaping and irrigation facilities located within and adjacent to the Pedestrian Easement Area, which areas are referred to in the Roadway and Utility Agreement as the "Landscape Easement Area"; (iv)installing, maintaining and using utility andservice facilities in, upon, over, across, under, and through those below-grade portions of the Phase1 Parcel and Phase2 Parcel described in the Roadway and Utility Agreement as the "Utility Easement Area"; and (v)installing, maintaining and using private storm drain facilities in, upon, over, across, under and through portions of the Parcels referred to in the Roadway and Utility Agreement as the "Private Drainage Easement Area", and (b)imposed certain installation and maintenance obligations upon Owners of the Phase1 Parcel and the Phase2 Parcel or their respective Associations for each of the foregoing. The Roadway Easement Area, the Pedestrian Easement Area, the Landscape Easement Area, the Private Drainage Easement -1- SMRH:481911721.23Master Declaration for Tustin Legacy Cornerstone I 06141725WR-246894 Area and the Utility Easement Area are depicted in the exhibits to the Roadway and Utility Agreement and are referred to in the Roadway and Utility Agreement as the "Easement Area" and collectively as the "Easement Areas" but, for purposes of this Master Declaration are referred to herein as the "Roadway and Utility Agreement Easement Areas." Maintenance Obligations for the Landscape Agreement Maintenance Areas. C. Pursuant to the Project Requirements, the Phase1 Owner and the City also entered into a Landscape Installation and Maintenance Agreement to establish licenses for the installation and maintenance of the landscaping and other improvements located within the "Perimeter Landscape Area" as described in the LandscapeInstallation and Maintenance Agreementand certain landscaped areas and other improvements located within portions of the Phase1 Parcel and Phase2 Parcel immediately adjacent to the Perimeter Landscape Areas described as the "Phase1 Landscape Area" and the "Phase2 Landscape Area" in the Landscape Installation and Maintenance Agreement,which collectively with the Perimeter Landscape Area are referred to in the Landscape Installation and Maintenance Agreement as the "Landscape Areas," but which are referred to in this Master Declaration as the "Landscape Agreement Maintenance Areas." The Landscape Installation and Maintenance Agreement imposes maintenance obligations upon the Owners of the Phase1 Parcel and the Phase2 Parcel and certain of the Associations created with respect to the Phase1 Parcel and the Phase2 Parcel. The Roadway and Utility Agreement Easement Areas Improvements and the Landscape Agreement Maintenance Areas Improvements aresometimes referred to collectively herein as the "Roadway andLandscape Agreements Improvements." Performance of Maintenance Obligations D.. The Phase1 Parcel is subject to the Flight Declaration pursuant to the terms of which the Flight Association was formed to govern and manage the Phase1 Parcel. Prior to the Phase2 Transfer Date, if all or any portion of the Roadway and Landscape Agreements Improvements are completed, Phase1 Owner, until the Maintenance Obligations for such improvements are assigned to and assumed by the Flight Association pursuant to the terms of either the Roadway and Utility Agreement or the Landscape Installation and Maintenance Agreement, and thereafter the Flight Association will perform the Maintenance Obligations for the Roadway and Utility Agreement Easement Areas and the Landscape Agreement Maintenance Areas in accordance with the terms of the Roadway and Utility Agreement and the Landscape Installation and Maintenance Agreement and, as to the Flight Association, the Flight Declaration. The City has granted an Option to acquire the Phase2 Parcel to the Optionee under the DDA. If the Optionee acquires the entirety of the Phase2 Parcel, the entire Phase2Parcel shall be annexed to the FlightDeclaration and upon such annexation the entire Phase2Parcel shall be subject to the Flight Declaration and the Flight Association will continue to perform all of the Maintenance Obligations under the Roadway and Utility Agreement and the Landscape Installation and Maintenance Agreement and, upon such annexation of the entirety of the Phase2 Parcel, this Master Declaration shall terminatein accordance with its terms and the annexation of all of the Phase1 Parcel into the Flight Association shall serve as Recorded notice of the termination of this Declaration. However, if the Optionee acquiresnone or only a portion of the Phase2Parcel, and as to any other portion of the Phase2 Parcel there is a Phase2 Transfer Date, then, as to the portion of the Phase2 Parcel which has not been annexed to the Flight Declaration, the Phase2 Owner shall record a Phase2 Declaration covering the portions of the Phase2 Parcel acquired by the Phase2 Owner and which shall (i)if there are multiple Phase2 Transfer Dates, at the next Phase2 Transfer Date require the annexation of any other portions of Phase2 Parcel as a condition to each such transfer, (ii)impose certain maintenance and other obligations and (iii)provide for the incorporation of the Phase2 Association to govern and manage such portions of the Phase2 Parcel if and when the portions of the Phase2 Parcel subject to the Phase2 Declaration are subdivided into Lots which are owned by multiple Owners. In order to assure the City that the Roadway and Utility Agreement Easement Areas and the Landscape Agreement Maintenance Areas will be maintained or continue to be maintained (if the Flight Association has been performing such Maintenance Obligations) as required by the Roadway and Landscape Agreements and the Project Requirements, the MasterAssociation shall be incorporatedas and when described herein (which incorporation shall occur upon the Phase2 Transfer Date or may occur upon a Flight Association Event of Default as described herein) and uponthe Master Association Incorporation Date, the Master Association will be responsible for performing the Maintenance Obligations described herein and for collecting the Allocable Shares of the Shared Expenses incurred by -2- SMRH:481911721.23Master Declaration for Tustin Legacy Cornerstone I 06141725WR-246894 the Master Association in performing its maintenance and other obligations under the Roadway and Landscape Agreements and exercising the rights (including, without limitation, its enforcement rights) described in this Master Declaration. Upon the Master Association Incorporation Date, theCovered Property shall be a commercial and industrial common interest development under the Commercial and Industrial CID Act and the Master Association shall have all of the powers under the Commercial and Industrial CID Act. The Members of the Master Association and the voting and other rights of the Members are described in Article3. Establishment ofEasements and Licenses E.. The Roadway and Utility Agreement establishes easements and the Landscape Installation and Maintenance Agreement establishes licenses required for the installation, use and maintenance of the Roadway and Utility Agreement Easement Areas and Landscape Agreement Maintenance Areas and the Roadway and Landscape Agreements Improvements, respectively, whicheasements and licenses are incorporated herein by reference as described in this Master Declaration. DECLARATION NOW, THEREFORE, Phase1 Owner and the City each declare with respect to its interest in the Covered Property, that the Covered Property is andshall be, held, conveyed, hypothecated, encumbered, leased, used and occupied subject to the following limitations, restrictions, easements, covenants, conditions, liens and charges, and all of which are declared and agreed to be for the purpose of enhancing, maintaining and protecting the value and attractiveness of the Covered Property. All of the limitations, restrictions, easements, covenants, conditions, liens and charges shall run with the land, shall be binding on and inure to the benefit of all Owners and the City and the governmental successors and assigns of the City and having or acquiring any right, title or interest in the Covered Property shall be enforceable equitable servitudes and shall be binding on and inure to the benefit of the successors-in-interest of such Owners and the City as the owner of the Perimeter Landscape Area, and as to the portions of the Phase2 Parcel owned by the City, and to the governmental successors and assigns of the City with respect to all other rights of the City under this Master Declaration. ARTICLE 1 DEFINITIONS Unless the context otherwise specifies or requires, or except as expressly specified in this Master Declaration, the terms defined in this Articleshall, for all purposes of this Master Declaration, have the meanings specified herein. 1.1"Additional Charges" has the meaning set forth in Section5.8. 1.2"Airship Avenue" means the private roadway indicated as Airship Avenue on the Final Map for Phase1 and the Public Access Declaration for Phase2, eachrecorded prior to or substantially concurrently with the recording of this Master Declaration, which roadway bifurcates a portion of the Phase1 Parcel and the Phase2 Parcel and is located generally as shown on the Site Plan. 1.3"Allocable Share" means the share of the Regular Assessments and Special Assessments allocated as described herein. Prior to the first Phase2 Transfer Date, the Flight Association shall be responsible for 100% of the Shared Expenses, regardless of whether the Flight Association Governed Property includes only the Phase1 Parcel or includes all or a portion of the Phase2 Parcel. If upon the first Phase2 Transfer Date all of the Phase2 Parcel is conveyed in one transfer to the Phase2 Owner, then the Allocable Share for the Phase1 Parcel and the Phase2 Parcel shall be as follows: Phase1 Parcel: 45% Phase2 Parcel: 55% -3- SMRH:481911721.23Master Declaration for Tustin Legacy Cornerstone I 06141725WR-246894 If, upon the first Phase2 Transfer Date only a portion of the Phase2 Parcel is conveyed to the Phase2 Owner then the Allocable Share for the Phase2 Parcel shall be 55% unless and until all or a portion of the balance of the Land Area within the Phase2 Parcel is annexed to the Flight Association Declaration and included within the Flight Association Governed Property without a further Phase2 Transfer Date having occurred as to any portion of the Phase2 Parcel (such that portions of the Phase2 Parcel are included within the ownership or control of the Flight Association, the Phase2 Owner or the Phase2 Association and the City,) then the Allocable Share shall be adjusted and calculated based upon the proportion which the Land Area within the Flight Association Governed Property or the Phase2 Association Governed Property, respectively, bears to the total Land Area within both Parcels, and with respect to the portion attributable to the balance of the Land Area owned by the City, the Members shall be allocated Shared Expenses for such balance of the Phase2 Parcel based upon the same percentage allocation specified above. In no event shall the City be allocated any Allocable Share or be responsible to pay any Shared Expenses regardless of whether it is then a Member or is then the Phase2 Owner as to all or any portion of the Phase2 Parcel. 1.4"Annual Budget" means the annual budget for Shared Expenses adopted by the Master Association in accordance with Section5.4hereof. 1.5"Applicable Laws" means any law, regulation, rule, order or ordinance of any Governmental Authorities having jurisdiction over the Covered Property and/or the formation and regulation of commercial and industrial common interest development associations, now in effect or as hereafter promulgated. 1.6"Assessment Commencement Date" has the meaning set forth in Section5.3. 1.7"Assessment" or "Assessments" means the assessments which are levied to cover the Shared Expenses under Article5or other Assessments permitted to be levied by the Master Association under this Master Declaration or the other Master Association Governing Documents, which include the Compliance Assessments, Regular Assessments and Special Assessments. 1.8"Association" means either the Flight Association, Phase2 Association and/or the Master Association as the context requires. 1.9"Association Declaration" means the Flight Declaration, this Master Declaration and/or the Phase2 Declaration, as the context requires. 1.10"Authorized Users" meanswith respect to the City, its elected and appointed officials, employees, agents, representatives, consultants, contractorsandwith respect to any Association or Owner its officers, directors, employees, agents, representatives, consultants and contractors. 1.11"Business Day(s)" means any day other than a Saturday, Sunday or day which is recognized as a national holiday ora state holiday in the State of California. 1.12"Casualty" means any damage to the Roadway and Landscape Agreements Improvements resulting from acasualty event such as fire, unusual weather causing damage, thefts, riots, vandalism, terrorism or other similar causes. 1.13"Certificate of Compliance" has the meaning set forth in the DDA. 1.14"City" means the City of Tustin, California. 1.15"City Indemnified Parties" means theCity, the Successor Agency to the Tustin Community Redevelopment Agencyand theirappointed and elected officials, agents, attorneys, affiliates, employees, contractors,and representatives. -4- SMRH:481911721.23Master Declaration for Tustin Legacy Cornerstone I 06141725WR-246894 1.16"City Landscape Areas" means the areas described in the Landscape Installation and Maintenance Agreement as the City Landscape Areas. 1.17"Claims" means any and all claims, actions, causes of action, demands, orders, or other means of seeking or recovering losses, damages, liabilities, costs, expenses (including, without limitation, 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 of compensation whatsoever, direct or indirect, known or unknown, foreseen or unforeseen. 1.18"Commercial and Industrial CID Act" means the Commercial and Industrial Common Interest Development Act set forth in Civil Code Section6500 etseq. 1.19"Compliance Assessments" means the Compliance Assessments described in Section5.5.3. 1.20"County" means the County of Orange, California. 1.21"Covered Property" has the meaning set forth in Recital A. 1.22"DDA" means the Tustin Legacy Disposition and Development Agreement CornerstoneI entered into by and between the City of Tustin and Flight Venture LLC, a Delaware limited liability company on November15, 2016, which has been amended pursuant to that certain First Amendment to Tustin Legacy Disposition and Development Agreement CornerstoneI dated as of June20, 2017, and any further amendments or supplements thereto. 1.23"Default Interest Rate" means an interest rate of eight percent (8%) per annum, compounded annually, but in no event in excess of the maximum legal rate. 1.24"Development Agreement" means theTustin Legacy Cornerstone IDevelopment Agreement by and between the City and Flight Venture LLC, a Delaware limited liability companydated December15, 2016 which was Recorded against the Parcels on March30, 2017 as Instrument No.2017- 000128365, as the same may be amended, modified or supplemented in accordance with its terms. 1.25"Director" means any director appointed to the Master Board by a Member pursuant to Section3.1.2. 1.26"Emergency" means any situation, condition or event which threatens imminent damage or injury to Person(s)or any of the Master Association Maintenance Areas. 1.27Entitlements and Conditions ""means (a)where applicable to matters addressed in or governed by the Roadway and Utility Easement Agreement, the matters defined as "Entitlements"and the matters defined as "Conditions"in such agreement and (b)where applicable to matters addressed in or governed by the Landscape Installation and Maintenance Agreement, the matters defined as "Entitlements"and the matters defined as "Conditions"in such agreement, and in each case, as the same may be amended or modified from time to time. 1.28"Final Map" means, with respect to the Phase1 Parcel, final tract map no.18082 recorded in the Official Records covering the Phase1 Parcel as described on Exhibit"A", and with respect to the Phase2 Parcel, any final tract map or parcel map further subdividing the Phase2 Parcel into Lots. 1.29"First Mortgage" means a Mortgage which has priority under the recording statutes of the State of California over all other Mortgages encumbering the applicableLot. -5- SMRH:481911721.23Master Declaration for Tustin Legacy Cornerstone I 06141725WR-246894 1.30"First Mortgagee" means the Mortgagee of a First Mortgage. 1.31"Fiscal Year" means a calendar year unless the Master Board elects a different accounting period. 1.32"Flight Association" means the Flight at Tustin Legacy Owners Association, a California nonprofit mutual benefit corporation formed to govern and manage the Phase1 Parcel, and if all or any portion of the Phase2 Parcel is annexed, the portion of the Phase2 Parcel so annexed. 1.33"Flight Association Event of Default" means any default by the Flight Association under the Roadway and Utility Agreement which the Flight Association shall fail to cure pursuant to the terms of and within the time period required by Section5.1of the Roadway and Utility Agreementor any default by the Flight Association under the Landscape Installation and Maintenance Agreement which the Flight Association shall fail to cure pursuant to the terms of and with the time periods required by Section10.1of the Landscape Installation and Maintenance Agreement. 1.34"Flight Association Governed Property" means all of the Phase1 Parcel, and upon annexation, any portion of the Phase2 Parcel which is annexed to the Flight Declaration. 1.35"Flight Board" means the Board of Directors of the Flight Association. 1.36"Flight Declaration" means the Declaration of Covenants, Conditions and Restrictions and Establishment of Easements for the Flight at Tustin Legacy recorded in the Official Records concurrently herewith and any amendments or supplements thereto. 1.37"Flight Way" means the private roadway indicated as Flight Way on the Final Map for Phase1 and the Public Access Declaration for Phase2, each recorded prior to or substantially concurrently with the recording of this Master Declaration, which roadway bifurcates a portion of the Phase1 Parcel and the Phase2 Parcel and is located generally as shown on the Site Plan. 1.38"Governmental Authority" means any and all federal, State, County, municipal and local governmental and quasi-governmental bodies and authorities (including the United States of America, the State of California and any political subdivision, public corporation, district, college and/or school district, joint powers authority or other political or public entity) or in the departments thereof having or exercising jurisdiction over the Phase1 Parcel, thePhase2 Parcel and/or the Perimeter Landscape Area. 1.39"Ground Lease" means any writtengroundlease of an entire Lotwith an initial term, excluding option terms, of thirty-five (35) years or more, which is Recorded in the Official Records or as to . which a Memorandum of Lease (or like instrument) has been Recorded in the Official Records 1.40"Incorporating Party" has the meaning set forth in Section3.1. 1.41"Indemnified Parties" means theofficers, directors, employees, partners, members and other representatives of City, an Owner or the Association. 1.42"Land Area" means the gross acreage of a Lot as depicted on a Final Map, or if not depicted on the Final Map, as shown on an ALTA Survey covering the applicable Lot. 1.43"Landscape Agreement Maintenance Areas" means the areas described in the Landscape Installation and Maintenance Agreement as the "Landscape Areas" which consist of the areas described in the Landscape Installation and Maintenance Agreement as the Perimeter Landscape Areas, the Phase1 Landscape Area and the Phase2 Landscape Area. -6- SMRH:481911721.23Master Declaration for Tustin Legacy Cornerstone I 06141725WR-246894 1.44"Landscape Easement Area" means the area described in the Roadway and Utility Agreement as the "Landscape Easement Area". 1.45"Landscape Improvements" means any and all landscaping, irrigation and/or hardscape improvements constructed and/or installed within the Landscape Agreement Maintenance Areas pursuant to the Landscape Installation and Maintenance Agreement. 1.46"Landscape Installation and MaintenanceAgreement" means that certain Landscape Installation and Maintenance Agreement executed by the City and Phase1 Owner and Recorded in the Official Records prior to or concurrently herewith and any amendments thereto. 1.47"Lease" means any lease, sublease,license or other agreement whereby a Person acquires rights to use or occupy any portion of a building for a specified term. 1.48"Lessee" means any tenant or lessee occupying a portion of a building pursuant to a written Lease. 1.49"Lot" means each legally subdivided lot within the Phase1 Parcel or Phase2 Parcel created under a Final Map. 1.50"Maintenance" (whether capitalized or not) means maintain, repair and/or replace unless otherwise specified in this Master Declaration. 1.51"Maintenance Obligations" means all of the maintenance obligations imposed under the Roadway and Utility Agreement and the Landscape Installation and Maintenance Agreement and this Master Declaration and the Project Requirements. 1.52"Major Decision" or "Major Decisions" means individually or collectively, as the context requires, any of the decisions of the Master Board requiring the approval of all of the Directors of the Master Association described in Section3.6. 1.53"Majority Land Area Association" means the Association which has jurisdiction over a majority of the Land Area in the Parcels. 1.54"Master Association" means the Master Maintenance Association for Tustin Legacy CornerstoneI, a California non-profit mutual benefit corporation which shall beincorporated if the Phase2 Transfer Date occurs or which may be incorporated by the City upon a Flight Association Event of Default as described in Article3. 1.55"Master Association Articles" means the Articlesof Incorporation of the Master Association inthe form attached hereto as Exhibit"D"as the same may be amended by the Incorporating Party in good faith good faith to complete the same or to comply with then applicable legal requirements and which shall be filed in the Office of the Secretary of State if a Master Association Incorporation Event occurs and any amendments thereto. 1.56"Master Association Bylaws" means the Bylaws of the Master Association which shall be adopted by the Master Board when the Master Association Incorporation Date occurs in the form attached hereto as Exhibit"E" as they may from time to time be amended or supplemented. 1.57"Master Association Governing Documents" means, collectively, this Master Declaration, the Master Association Articlesand the Master Association Bylaws. 1.58"Master Association Incorporation Date" means the date the Master Association Articlesare filed in the Office of the Secretary of State. -7- SMRH:481911721.23Master Declaration for Tustin Legacy Cornerstone I 06141725WR-246894 1.59"Master Association Incorporation Event" means the earlier to occur of (a)the Phase2 Transfer Date or (b)a Flight Association Event of Default in performing its obligations as the Responsible Association under either of the Roadway and Landscape Agreements and the election by the City to incorporate the Master Association as described in Section3.1as a result of such Flight Association Event of Default. 1.60"Master Association Maintenance Areas" means the areas required to be maintained by the Master Association under this Master Declaration which consist of the Roadway and Utility Agreement Easement Areas required to be maintained under the Roadway and Utility Agreement and the Landscape Areas required to be maintained under the Landscape Installation and Maintenance Agreement. 1.61"Master Board" means the Board of Directors of the Master Association. 1.62"Master Declaration" means this Master Declaration Establishing Maintenance and Cost Sharing Obligations for Tustin Legacy CornerstoneI, as this Master Declaration may from time to time be amended or supplemented pursuant to the terms hereof. 1.63"Member" or "Members" means individually or collective, as the context requires, the Flight Association and the Phase2 Association or if the City has incorporated the Master Association as a result of a Flight Association Event of Default, the Flight Association and the City until the Phase2 Transfer Date, at which time the Members shall be the Flight Association and the Phase2 Association. 1.64"Mortgage" means prior to issuance of a Certificate of Compliance under the DDA any Permitted Mortgage (as such term is defined in the DDA) under the DDA, or prior to the issuance of the equivalent certificate under any other disposition and development agreement or similar instrument covering the Phase2 Parcel, if applicable, any Permitted Mortgage (or any similar term used therein to denote a Mortgage approved by the City), and following issuance of such certificate as toany Lot, any duly recorded mortgage or deed of trust encumbering a fee or ground leasehold interest in such Lot. 1.65"Mortgagee" means prior to issuance of a Certificate of Compliance under the DDA any Permitted Mortgagee (as such term is defined in the DDA)under the DDA, or prior to the issuance of the equivalent certificate under any other disposition and development agreement or similar instrument covering the Phase2 Parcel, if applicable, any Permitted Mortgagee (or any similar term used therein to denote a Mortgagee approved by the City), and following issuance of such certificate as to any Lot, any mortgagee under a mortgage and each beneficiary under a deed of trust affecting such Lot. 1.66"Notice of Delinquent Assessments" shall have the meaning set forth in Section5.10.5(c). 1.67"Official Records" means the official public records in the Office of the County Recorder of the County. 1.68"Operational Dispute" means a dispute as described in Section9.3 which shall be resolved in accordance with the terms of Section9.3. 1.69"Operational Dispute Notice" means a notice delivered pursuant to Section9.3of an Operational Dispute. 1.70"Option" means the option granted by the City to the Optionee under the DDA to acquire fee title to the Phase2 Parcel. 1.71"Optionee" means the holder of the Option or its nominee under the DDA. -8- SMRH:481911721.23Master Declaration for Tustin Legacy Cornerstone I 06141725WR-246894 1.72"Owner" means (a)the record owner from time to time, whether one(1)or more Persons, of feesimple title to any Lot within the Parcels, but expressly excluding the City during its term of ownership of any such Lot or Parcel except as set forth in clause (b)below, and (b)with respect to any Lot which is subject to a Ground Lease, including any Lot or Parcel under aGround Lease executed by the City, the Lessee under such Ground Lease while such Ground Lease is in effect and upon termination of such Ground Lease, means the fee title Owner of such Lot. "Owner"shall exclude those Persons merely having a security interest in a Lot, unless and until such Person acquires fee title thereto (or in the case of a Mortgage encumbering a Ground Lease, upon the holder of such security interest acquiring the subject leasehold estate thereunder). 1.73"Parcels" means collectivelythe Phase1 Parcel and Phase2 Parcel. 1.74"Pedestrian Easement Area" means the area described in the Roadway and Utility Agreement as the "Pedestrian Easement Area." 1.75"Perimeter Landscape Area" means the real property owned by the City within which a portion of the City Landscape Areas are located and described in the Landscape Installation and Maintenance Agreement as the Perimeter Landscape Area. 1.76Permittees ""means the Authorized Usersand the respectivelessees, invitees, licensees, vendors, customers, and tenantsof each Owner, Member, Master Association, any other Association and/or the City. 1.77"Person" means an individual, partnership, limited partnership, trust, estate, association, corporation, limited liability company, joint venture, firm, joint stock company, unincorporated association, Governmental Authority, or other entity, domestic or foreign. 1.78"Phase" means either the Phase1 Parcel or the Phase2 Parcel. 1.79"Phase1 Landscape Area " means the area described in the Landscape Installation and Maintenance Agreement as the Phase1 Landscape Area. 1.80"Phase1 Owner" means Flight PhaseIOwner LLC, a Delaware limited liability company. 1.81"Phase1 Parcel" means the real property described on Exhibit"A"as the Phase1 Parcel. 1.82"Phase2 Association" means the owners association which shall be formed to govern the Phase2 Parcel or the portion thereof acquired by the Phase2 Owner upon the Phase2 Transfer Date if and when the Lots within the Phase2 Parcel are owned by multiple different Owners. After the Phase2 Transfer Date, if the Phase2 Association has not been incorporated, and all of the portions of the Phase2 Parcel acquired by the Phase2 Owner are owned by a single Owner, references in this Master Declaration to the Phase2 Association shall mean such Phase2 Owner. 1.83"Phase2 Association Governed Property" means any portion of the Phase2 Parcel which is acquired by the Phase2 Owner and which is subject to the Phase2 Declaration and, upon formation, subject to the jurisdiction of the Phase2 Association. 1.84"Phase2 Declaration" means the declaration of covenants, conditions and restrictions which shall be recorded upon the first Phase2 Transfer Date and which shall provide for the establishment of the Phase2 Association if and when the Lots within the portions of the Phase2 Parcel which were conveyed upon a Phase2 Transfer Date are owned by multiple different Owners. If upon the first Phase2 Transfer Date, only a portion of the Phase2 Parcel is conveyed by the City, the Phase2 Declaration shall require any other portions of the Phase2 Parcel which are conveyed by the City to any -9- SMRH:481911721.23Master Declaration for Tustin Legacy Cornerstone I 06141725WR-246894 Owner (other than an Optionee) to be annexed to the Phase2 Declaration and governed by the Phase2 Association. 1.85"Phase2 Landscape Area" means the area described in the Landscape Installation and Maintenance Agreementas the Phase2 Landscape Area. 1.86"Phase2 Owner" means the Owner who acquires fee title to, or a Ground Lease interest in, all or any portion of the Phase2 Parcel from the City upon the Phase2 Transfer Date. 1.87"Phase2 Parcel" means the real property described on Exhibit"C"as the Phase2 Parcel. 1.88"Phase2 Transfer Date" meansthe date or dates on which the City transfers any Ground Lease interest in, or fee title to, all or any portionof the Phase2 Parcelother than a transfer to the Optionee as a result of the exercise of the Option by Optionee,for the purpose of development of the Phase2 Parcelor the portions thereof so acquired without such property having been annexed to the Flight Declaration, with the first such Phase2 Transfer Date referred to herein as the first Phase2 Transfer Date. 1.89"Private Drainage Easement Area" means the area described in the Roadway and Utility Agreement as the "Private Drainage Easement Area." 1.90"Project Requirements" means (a)during the term thereof, the requirements of the DDA, including without limitation, Section8 thereof, the Memorandum of DDA and the Tustin Legacy Cornerstone I Development Agreement by and between the City and Flight Venture LLC, a Delaware limited liability company dated December15, 2016, which was recorded against the Covered Property, (b)during the term of eachagreement or instrument recorded pursuant to the DDA, the term of such agreement or instrument, (c)the most current general plan for the City and the MCAS Tustin Specific Plan/Reuse Plan, as amended from time to time, (d)the Entitlementsand Conditionsand all future entitlements and conditions of development approved by the City for the Covered Property, including without limitation those imposed by the City in connection with any discretionary land use approval and entitlements as a condition to the development of the Phase2 Parcel,and (e)all laws, rules and regulations with respect to the obligations under this Master Declaration and the Master Association Maintenance Areas, including without limitation, those issued by the City, the Environmental Protection Agency, or any federal, state, interstate, regional or local governmental agency having jurisdictionover the Covered Property or any of them, including without limitation, with respect to abatement or prevention of pollution. 1.91"PublicAccess Right" means the right ofpublic access for the benefit of the City and the public within the area comprising the Roadway Easement Area (as defined in the Roadway and Utility Easement Agreement) which has been or shall be set forth with respect to the portions thereof located on the Phase1 Parcel, on the Final Map Recorded against the Phase1 Parcel, and with respect to the portions thereof located on the Phase2 Parcel, as legally described on either a Final Map Recorded against the Phase2 Parcelor in any recorded covenant creating such right of public access and/or granting a publicaccess easement for the benefit of the City and the public. 1.92"Public Access Declaration" means the instrument or instruments, including without limitation, any Final Map or covenant, creating the Public Access Right upon the Phase1 Parcel and the Phase2 Parcel. 1.93"Record", "Recording" and "Recorded" means to record the specified instrument, or the current or past recording of the specified instrument, in the Official Records. 1.94"Regular Assessments" means the Regular Assessments as described in Section5.5.1. -10- SMRH:481911721.23Master Declaration for Tustin Legacy Cornerstone I 06141725WR-246894 1.95"Responsible Association" has the meaning set forth in the Roadway and Landscape Agreements. Prior to the Master Association Incorporation Date, if the Maintenance Obligations under the Roadway and Landscape Agreements have commenced and have been assigned to the Flight Association pursuant to Section7.18of the Roadway and Utility Agreementand Section26of the Landscape Installation and Maintenance Agreement, references herein to theResponsible Association mean the Flight Association. 1.96"Roadway and Landscape Agreements" means collectively the Roadway and Utility Agreement and the Landscape Installation and Maintenance Agreement. 1.97"Roadway and Landscape Agreements Improvements" means collectively, the Landscape Improvementsrequired to be maintained under the Landscape Installation and Maintenance Agreement and the Roadway and Utility Agreement Maintenance Area Improvements required to be maintained under the Roadway and Utility Agreement. 1.98"Roadway and Utility Agreement" means the Roadway, Landscape and Utility Easement Agreement executed by the City and Phase1 Owner and Recorded in the Official Records prior to or concurrently herewith and any amendments thereto. 1.99"Roadway and Utility Agreement Maintenance Area Improvements" means all of theimprovements within the Roadway and Utility Agreement Easement Areas defined as the Easement Area Improvements in the Roadway and Utility Agreement. 1.100"Roadway and Utility Agreement Easement Areas" has the meaning set forth in Recital B above. 1.101"Roadway Easement Area" means the area described in the Roadway and Utility Agreement as the "Roadway Easement Area." 1.102"Shared Expenses" means all of the costs and expenses incurred by the Master Association on and after the Master Association Incorporation Date associated with the maintenance and operation of the Master Association Maintenance Areas and other services provided by the Master Association, and expenses incurred in connection with the incorporation of the Master Association under this Master Declaration and all costs and expenses incurred by the Master Association in performing the obligations under this Declaration and the Roadway and Landscape Agreements which include without limitation, the following expenses: (a) expenses incurred in the performance of the Maintenance Obligations and other non-administrative obligations of the Master Association hereunder, including without limitation, expenses incurred for the Maintenance, managementandoperation, of the Master Association Maintenance Areas and Roadway and Landscape Agreements Improvements located therein and any other expenses incurred under the Roadway and Landscape Agreements; (b) expenses incurred to cover due but unpaid Assessments and to enforce the collection of such Assessments; (c) expenses of management and administration of the Master Association, including, without limitation, compensation actually paid by the Master Association to managers, accountants, attorneys, employees and consultants and expenses incurred in maintaining the legal status and qualifications of the Flight Association as an entity in good standing and qualified to do business in the State of California; (d) expenses incurred in incorporating the Master Association and maintaining the legal status and qualifications of the Master Association as an entity in good standing and qualified to do business in the State of California; -11- SMRH:481911721.23Master Declaration for Tustin Legacy Cornerstone I 06141725WR-246894 (e) reasonable operating and replacement reserves for the Roadway and Landscape Agreements Improvements which are subject to the Maintenance Obligations of the Master Association; (f) expenses of operation, maintenance, repair and replacement and for performing any inspections required by Project Requirements or deemed necessary by the Master Association for utility facilities serving the Master Association Maintenance Areas and the Roadway and Landscape Agreements Improvements located therein and any utility charges incurred in connection with the maintenance and operation of the Roadway and Landscape Agreements Improvements; (g) expenses of operation, maintenance, repair and replacement and for performing any inspections required by Project Requirements or deemed necessary by the Master Associationfor all Roadway andLandscape Agreements Improvements,including without limitation, stormwater, sewer and utility facilities and improvements required to be maintained by the Master Association under the Roadway and Landscape Agreements and any utility charges incurred in connection with the maintenance and operation of the foregoing that are not metered or submetered to Owners or Lots individually; (h) expenses of insurance maintained by the Master Association as required under this Master Declaration; (i) expenses of any indemnification obligations of the Master Association under the Roadway and Landscape Agreements and/or this Master Declaration (subject to the right of the Master Association to pursue an Owner or Association for reimbursement if the indemnification obligations arise from the actions or omissions of any Owner or Association or their Permittees as provided for herein and in the Roadway and Landscape Agreements); (j) expenses of any other services or items designated in the Annual Budget or incurred by the Master Association in connection with the operation, maintenance, repair, replacement inspection and/or governance of the Roadway and Utility EasementAreasand/or the Landscape Easement Area and to exercise any rights and discharge any obligations imposed on Master Association under the Master Association Governing Documents and the Project Requirements and to enforce any obligations under the Master Association Governing Documents and the Project Requirements; and (k) any other expenses incurred by the Master Association in connection with the performance of its obligations under the Roadway and Landscape Agreements and this Master Declaration, and to exercise any rights and discharge any obligations imposed on the Master Association under the Project Requirements, including without limitation, expenses incurred in complying with ongoing requirements of the Master Association under the Requirements. 1.103"Site Plan" means the Site Plan attached hereto as Exhibit"B"which is included solely as a pictorialillustration of the approximate locations of the Phase1 Parcel and Phase2 Parcel and certain other areas as depicted on such Site Plan. 1.104"Special Assessments" means the Special Assessments as described in Section5.5.2. 1.105"Supplemental Declaration" means any supplemental declaration recorded by the Master Board to memorialize the Master Association Incorporation Date. 1.106Utility Easement Area ""means the area described in the Roadway and Utility Agreement as the "Utility Easement Area." -12- SMRH:481911721.23Master Declaration for Tustin Legacy Cornerstone I 06141725WR-246894 ARTICLE 2 EASEMENTS. LICENSES AND PARKING AND USE RESTRICTIONS 2.1Ownership and Easements [[1153,446,1203,494][10][B,I,][Arial]]. [[1190,446,2300,493][10][,,][Arial]]All of the easements established under the Roadway and Utility Agreement and licenses, if any, established under the Roadway and Utility Agreement are incorporated herein by reference as though fully set forth herein and all of the licenses established under the Landscape Installation and Maintenance Agreement are incorporated herein by reference as though fully set forth herein. It is the intent of this Master Declaration that, upon the Master Association Incorporation Date, the Master Association shall be entitled to exercise all of the easements and licenses established under the Roadway and Utility Agreement and the Landscape Installation and Maintenance Agreement as if it were a party to each of such agreements and that the Master Association shall have all easements and licenses necessary to perform its Maintenance Obligations and exercise its rights and remedies under this Master Declaration and under the Roadway and Utility Agreements. 2.2Parking Rightswithin the Shared Roadways . Portions of Flight Way and Airship Avenue may include parking spaces and the Flight Association shall have the right to control the use of the parking spaces located on the portions of Flight Way and Airship Avenue which are in the Phase1 Parcel and, until the Phase2 Transfer Date, the Phase2 Parcel. Upon and after the Phase2 Transfer Date, the Phase2 Association shall have the right to control the use of the parking spaces located within the portions of Flight Way and Airship Avenue located within the Phase2 Parcel. The rights to control the use and location of the parking spaces located within Flight Way and Airship Avenue include without limitation, the right, subject to compliance with the Project Requirements, to reduce, increase or modify the location of such parking spaces and the right of either the Flight Association or Phase2 Association to Parking Meter Equipment install parking meters, parking stations and similar equipment ("") and to retain the revenue therefrom. The Flight Association shall not have the right to protest or contest any increase or decrease or modification of the parking spaces located within the portions of Flight Way and Airship Avenue which are included within the Phase2Parcel or the installation or modification of Parking Meter Equipment therein after the Phase2 Transfer Date and the Phase2 Association shall not have the right to protest or contest any increase or decrease or modifications of the parking spaces locatedwithin the portions of Flight Way and Airship Avenue which are included within the Phase1 Parcel, or the installation or modification of Parking Meter Equipment therein, in either case so long as any changes to or use of the parking spaces or installation or modification of Parking Meter Equipment by the Flight Association or Phase2 Association are authorized under the Project Requirements. 2.3Exercise of Easement and License Rights . The Master Association, the Members, each Owner and, if applicable, the City, in exercising any easement and, if applicable, license rights under the Roadway and Utility Agreement and/or any license rights under the Landscape Installation and Maintenance Agreement, shall comply with all covenants, restrictions and limitations on the exercise of such rights set forth in the Roadway and Utility Agreement and/or the Landscape Installation and Maintenance Agreement, as applicable. ARTICLE 3 MASTER ASSOCIATION INCORPORATION DATE AND ESTABLISHMENT OF MASTER ASSOCIATION AND PHASE 2 ASSOCIATION 3.1Procedure for Incorporation of the Master Association. Upon the Phase2 Transfer Date, any of the Phase2 Owner, the Flight Board or the City shall incorporate the Master Association by undertaking the actions specified below. Alternatively, if, prior to the Phase2 Transfer Date, the Flight Association is the Responsible Association under either or both of the Roadway and Landscape Agreements and a Flight Association Event of Default has occurred under either of such agreements, the City may incorporate the Master Association by undertaking the actions described below. The Person Incorporating Party" incorporating the Master Association hereunder is referred to as the ". Notwithstanding anything to the contrary set forth in this Master Declaration including any references to powers or duties of the Master Association, in no event shall the Master Association have any of the powers or duties under this Master Declaration or the Master Association Governing Documents unless and until the Master Association Incorporation Date occurs. The covenants contained in this Article3are -13- SMRH:481911721.23Master Declaration for Tustin Legacy Cornerstone I 06141725WR-246894 covenants running with the land effective as of the Recording of this Master Declaration and it is the intent that all of such covenants may be exercised by the Phase2 Owner, the Flight Board or the City as provided above to cause the Master Association Incorporation Date to occur in accordance with the procedures set forth below. File the Master Association Articles . The Incorporating Party shall have the right to execute and file the Master Association Articlesas the sole incorporator. The Incorporating Party shall file the Master Association Articleswith the Office of the Secretary of State. The Flight Board, the Phase2 Owner and the City shall cooperate and coordinate with each other in connection with the timely filing of theMaster Association Articlesas and when provided in this Master Declaration, shall execute any documents required to be executed in connection with incorporation of the Master Association and the Incorporating Party filing the Master Association Articlesshall provide notice thereof, together with a copy of the filed Master Association Articlesto the other parties listed in this Section3.1.1. Establishment of Master Board . The Master Board shall be established upon the Master Association Incorporation Date. The Master Board shall consist of three (3)Directors appointed as provided below. (a)Incorporation Upon Occurrence of Phase2 Transfer Date for all of the Phase2 Parcel . If the Master Association is being incorporated as a result of the occurrence of the Phase2 Transfer Date for all of the Phase2 Parcel, then two (2)of the Directors shall initially be appointed by the Phase2 Owner (and thereafter upon expiration of their terms and establishment of the Phase2 Association, such Directors shall beappointed by the Phase2 Association) and one (1)Director shall be appointed by the Flight Association. (b)Incorporation After Phase2 Transfer Date . If the Master Association is being incorporated as a result of the occurrence of a Phase2 Transfer Datefor a portion of the Phase2 Parcel, the Member who has been allocated a majority of the Allocable Share pursuant to Section1.3shall appoint two (2)Directors and the other Association shall appoint one (1)Director. At any subsequent conveyance by theCity of all or any portion of its remaining property within the Phase2 Parcel, the appointment of Directors shall be determined again and allocated to the Member who has then been allocated a majority of the Allocable Share pursuant to Section1.3. (c)Incorporation Prior to Phase2 Transfer Date as a Result of a Flight Association Event of Default . If the Master Association is being incorporated prior to the Phase2 Transfer Date by the City as a result of a Flight Association Event of Default, then two (2)of such Directors shall be appointed by the City and shall continue to be appointed by the City until the Phase2 Transfer Date occurs, at which time, the Directors appointed by the City shall resign and be replaced by Directors appointed by the Majority Land Area Association unless the City elects to have the Directors it has appointed remain on the Master Board until expiration of their term, in which case upon expiration of their term the replacement Directors shall be appointed by the Majority Land Area Association and the other Director shall be appointed by the other Association. Qualificationsfor Board . The representatives to the Master Board for the Flight Association and Phase2 Association shall be officers within each of the Flight Association and Phase2 Association unless the Members otherwise agree. Record a Supplemental Declaration . The Incorporating Party or if the Incorporating Party so elects, the Master Board shall have the authority to Record a Supplemental Declaration to provide notice of the incorporation of the Master Association. Resolution and Adoption of Master Association Bylaws . The Master Board shall adopt the Master Association Bylaws in the form attached as Exhibit"E". The Master Board shall adopt any resolutions required to authorize the actions to be undertaken by the Master Board, including without limitation the adoption of the Annual Budget and the adoption of the Master Association Bylaws. -14- SMRH:481911721.23Master Declaration for Tustin Legacy Cornerstone I 06141725WR-246894 Transfer of Recordsand Funds . Promptly following the Master Association Incorporation Date, the Responsible Party (as defined in each of the Roadway and Landscape Agreements) shall (a)transfer all records, documents and other information reasonably pertinent to the performance by the Master Association of its obligations under this Agreement, including without limitation, warranties, contracts, if requested by the Master Association, maintenance records and schedules related to the installation and maintenance of the Roadway and Landscape Agreements Improvements and Maintenance of the Master Association Maintenance Areas; (b)shall terminate or, if so requested by the Master Board, assign any contracts for maintenance of the Roadway and Landscape Agreements Improvements to the Master Association and (c)shall transfer any fundsheld by the Flight Association for the expenses related to the Roadway and Landscape Agreements and the Roadway and Landscape Agreements Improvementsand/or maintenance obligations with respect thereto, including funds held by as "Shared Expenses" to the counterpart accounts for such purposes established by the Master Association, provided that any amounts incurred by the Responsible Association in performing its obligations hereunder prior to the Master Association Incorporation Date shall be the obligation of such Responsible Association and shall not be transferred to the Master Association. 3.2Actions to Be Taken After the Master Association Incorporation Date . As soon as possible after the Master Association Incorporation Date, the Master Board shall file the applicable notices or statements required to be filed by Applicable Laws and obtain any additional insurance required by this Master Declaration as a result of the incorporation of the Master Association and undertake any other actions reasonably required for the commencement of operations and the performance of the duties of the Master Association. 3.3Membership . Qualifications . The Flight Association and the Phase2 Association shall be the Members of the Master Association unless the Master Association is being incorporated by the City as a result of a Flight Association Event of Default in which case the Flight Association and the City shall be the Members of the Master Association until the Phase2 Transfer Date, at which time the Phase2 Association shall replace the City as the Member for the Phase2 Parcel. Members' Rights and Duties . On and after the Master Association Incorporation Date, each Member shall have the rights, duties and obligations set forth in this Master Declaration and the other Master Association Governing Documents. 3.4Voting Power . Each Member shall have one (1)vote for any matters requiring the vote of the Members under this Master Declaration or the other Master Association Governing Documents. 3.5Master Board . Upon and after the Master Association Incorporation Date, all actions of the Master Association which do not specifically require a vote of the Members under this Master Declaration shall be taken by majority vote of the Master Board acting on behalf ofthe Master Association except for Major Decisions as provided in Section3.6below. 3.6Major Decisions .Notwithstanding the provisions of Section3.5set forth above, the Master Boardshallnottake any of the actions set forth below without the consent ofall of the Directors on the Master Board except to the extent otherwise specifically provided in Article5: Adoption of Budget . The adoption of the Annual Budget for any calendar year other than the calendar year in which the Master Association Incorporation Date occurs; Special Assessments . The levying of any Special Assessments except as otherwise provided in Section5.5.2; Changes to the Allocable Shares .Any changes to the Allocable Shares; and/or -15- SMRH:481911721.23Master Declaration for Tustin Legacy Cornerstone I 06141725WR-246894 Maintenance Obligations . Any changes to the Maintenance Obligations or the standards of maintenance imposed under either of the Roadway and Landscape Agreements and/or this Master Declaration or any modification to the level of maintenance above the level then in effect, unless such modification of the maintenance standards is required by the City pursuant to the terms of either of the Roadway and Landscape Agreements. 3.7Powers of the Master Association . From and after the Master Association Incorporation Date the Master Association shall have all of the powers of a California non-profit mutual benefit corporation. The exercise by the Master Association of any powers and duties shall, however, be subject to any limitations on the exercise of such powers and duties set forth in the Roadway and Landscape Agreements. Performance of Duties . The Master Association shall have the power to undertake all of the express duties required under Section3.8below to be done by the Master Association. Enforcement . The Master Association shall have the power to enforce the restrictions and obligations set forth in this Master Declaration. Restrict Access . Subject to the terms of the Roadway and Landscape Agreements, the Master Association shall have the right and authority to restrict access on or to any portion of the Master Association Maintenance Areas (a)for purposes of facilitating construction, inspection, maintenance and repair of the Roadway and Landscape Agreements Improvements within the Master Association Maintenance Areas as required by the Roadway and Landscape Agreements, (b)for Emergency purposes and/or (c)to comply with the Project Requirements. Any such restrictions on access shall reasonably minimize any impact on access to and from the Phase1 Parcel and Phase2 Parcel and shall not unreasonably restrict or interfere with the Public Access Right granted pursuant to the Public Access Declaration. Other Services . The Master Association may obtain and pay for the services of any Person to manage its affairs, or any part thereof, to the extent it deems advisable, as well as the services of such other personnel as the Master Association shall determine to be necessary or desirable for the maintenance of the Master Association Maintenance Areas and/or performance of its other obligations imposedunder this Master Declaration, whether such personnel are furnished or employed directly by the Master Association or by any Person with whom or with which it contracts; provided that if any such Person is the Flight Association or the Phase2 Association, or is affiliated with any Owner in any portion of the Parcels, any management or other administrative fees shall not exceed the costs of such services if the same were provided by qualified, unaffiliated parties in the Orange County area. Delegation of Powers . The Master Association shall have the power to delegate its rights, authority and powers, in whole or in part, under the Master Association Governing Documents to professional managers, committees, officers or consultants, as may be deemed necessary by the Master Board. 3.8Duties of the Master Association . In addition to the powers delegated to it by the Master Association Governing Documents, and without limiting their generality, the Master Association, acting by and through the Master Board, has the obligation to perform each of the duties set forth below, which obligations shall commence upon the Master Association Incorporation Date. Roadway and Landscape Agreements Improvements . Except for the initial installation of the Roadway and Landscape Agreements Improvements which shall be performed by the Phase1 Owner under the License Agreement or may be performed by the Phase2 Owner under the terms of the Roadway and Landscape Agreements, from and after the Master Association Incorporation Date, theMaster Association shall: -16- SMRH:481911721.23Master Declaration for Tustin Legacy Cornerstone I 06141725WR-246894 (a) maintain the Landscape Areas that are required to be maintained by a Responsible Association under the Landscape Installation and Maintenance Agreement; (b) maintain the Roadway and Utility Agreement Easement Areas; and (c) perform all of the other obligations under the Landscape Installation and Maintenance Agreement and the Roadway and Utility Agreement imposed upon the Responsible Association, and, if different, imposed upon the "Responsible Party" (as defined in each such agreement) as and when required under the applicable Landscape and Roadway Agreements. Applicable Laws and Project Requirements . The Master Association shall comply with the Project Requirements and with all Applicable Lawsapplicable to the Master Association Maintenance Areas and the performance by the Master Association of its powers and duties under this Master Declaration and the other Master Association Governing Documents. Assessments . The Master Association shall establish, levy and collect Assessments in accordance with Article5and enforce payment of such Assessments in accordance with the provisions of this Master Declaration. The Master Association shall allocate Shared Expenses based upon the Allocable Shares. The Master Associationshall establish and maintain a commercially reasonable reserve fundand shall include in the Annual Budgetthe required annual reserve amounts determined to be necessary by the Master Boardor as a result of resolution of an Operational Dispute. Financial Matters . The Master Association shall prepare the Annual Budget, reports, balance sheets and operating statements for the Master Association as required under the Master Association Governing Documents and Applicable Laws. Insurance . The Master Association shall obtain insurance required under the Roadway and Landscape Agreements and the other insurance described in Article6. Other Matters . The Master Association shall perform all other matters required of the Master Association under this Master Declaration, including without limitation, the Maintenance Obligations described in Section4.2. 3.9Personal Liability .No officer or director of the Master Board or of any committee of the Master Association (each a "Management Party"),shall be personally liable to any Owner or to any other Person, including the Master Association, for any act or omission of any Management Party if such Person has, on the basis of such information in such Person's actual possession, acted in good faith without willful, wanton or gross misconduct when performing an act within the scope of the Person's Association duties (collectively, an "Official Act"). The Master Association has the power and duty to indemnify, defend, protect and hold harmless each Management Party for all Claims incurred, pay expenses incurred and satisfy any judgment or fine levied as a result of any action or threatened action brought because of an act or omission which was an Official Act or which such Person reasonably believed was an Official Act. Management Parties are deemed to be agents of the Master Association when they are performing Official Acts for purposes of obtaining indemnification from the Master Association pursuant to this Section. The entitlement to indemnification under this Master Declaration inures to the benefit of the successors-in-interest of any Person entitled to such indemnification. The Master Association has the power, but not the duty, to indemnify any other Person acting as an agent of the Master Association for Claims incurred, pay expenses incurred, and satisfy any judgment or fine levied as a result of any action or threatened action because of an Official Act. The Master Association also has the power, but not the duty, to contract with any other Person to require such Person to provide indemnification in addition to any indemnification authorized by Applicable Laws and on such terms and subject to such conditions as the Master Association may impose. 3.10Establishment of Phase2 Association .If the Phase2 Transfer Date occurs and the Phase2 Owner acquires only a portion of the Phase2 Parcel, the Phase2 Declaration which is recorded -17- SMRH:481911721.23Master Declaration for Tustin Legacy Cornerstone I 06141725WR-246894 against the portions of the Phase2 Parcel so acquired shall require the annexation of any other portion of the Phase2 Parcel which is conveyed upon a subsequent Phase2 Transfer Date and shall require the establishment of the Phase2 Association if and when there are multiple Owners with Lots within the Phase2 Parcel subject to the Phase2 Declaration. ARTICLE 4 MAINTENANCE 4.1Maintenance Standards . All maintenance required to be performed hereunder by the Master Association shall be performed in conformance with the standards and requirements set forth in the Roadway and Landscape Agreements. Such obligations shall include without limitation, allof the obligations described in Article3of the Roadway and Utility Agreementand Section3of the Landscape Installation and Maintenance Agreement. 4.2Maintenance Obligations . The Master Association shall commence to perform all of the Maintenance Obligations upon the Master Association Incorporation Date and upon such date, the Master Association shall maintain the Master Association Maintenance Areas and all of the Roadway and Landscape Agreements Improvements located therein in conformance with all of the standards and obligations described in the Roadway and Utility Agreement and the Landscape Installation and Maintenance Agreement and this Master Declaration. The Maintenance Obligations shall be performed in accordance with all Applicable Laws. 4.3Rights to Take-Over Maintenance Obligations . From and after the Master Association Incorporation Date, if the Master Association fails to perform its Maintenance Obligations in accordance with the terms of this Master Declaration, any Member may deliver written notice of same to the Master Association and the other Member(s)of such failure, which notice shall specify in reasonable Repair detail, the maintenance deficiencies that are the subject of such notice (the ""). If the Repair is not (i)commenced by the Master Association within thirty (30) days after receipt of written request from the Member (or such shorter period as may be required under the Roadway and Utility Agreement and/or the Landscape Installation and Maintenance Agreement, as applicable), and (ii)diligently completed within thirty (30) days thereafter unless the Repair is of a nature that cannot reasonably be cured within thirty (30) days, in which event the Repair shall be diligently, pursued to completion (unless a shorter period to perform the Repair is required under the Roadway and Landscape Agreements, in which case the shorter periods shall apply), then the Member who has delivered the notice may, upon at least ten (10)days prior notice to the Master Association and the other Member(s)and the failure of the Master Association or the other Member(s)to commence such Repair within such ten (10)day period, complete the Repair and charge the reasonable costs thereof to the Master Association. Notwithstanding the foregoing, in the event of an emergency which threatens imminent injury or damage to person or property, any Member may take such actions as are reasonable under the circumstances to remedy the default by the Master Association and shall provide notice thereof to the Master Association as soon as reasonably practical. The costs associated with performing such Repair shall be due and payable to the Member performing the Repair within fifteen (15)days after receipt of a statement therefore documenting the reasonable costs incurred and if the Master Association fails to pay such amounts as and when due the Member shall have all of the same rights and remedies as are granted to the Master Association under Section5.5.3(b)and Section9.2.3of this Master Declaration. To the extent the Repair includes the Repair for capital improvements for which reserves have been collected by the Master Association, the Master Association shall reimburse the Member for the costs incurred in performing the Repair from such reserve funds. The Master Association shall fully cooperate with any Member exercising its rights hereunder in its assumption of any Repair, including, without limitation, granting or causing the grant of any required licenses to access the portion of the Covered Property to theextent necessary or desirable to perform the Repair. 4.4Duty to Protect Against Mechanics' Liens . In performing its Maintenance Obligations as provided in this Master Declaration, the Master Association shall promptly pay all costs, expenses, liabilities and liens arising out of or in any way connected with the contracts for any service, labor or materials provided or supplied and shall keep the portions of the Covered Property upon which the work -18- SMRH:481911721.23Master Declaration for Tustin Legacy Cornerstone I 06141725WR-246894 is being performedfree and clear of any mechanics'liens ormaterialmen's liens arising with respect to the performance of the Maintenance Obligations or exercise of the rights underthis Master Declaration. The Master Association 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 upon theCovered Property.Notwithstanding the foregoing, the Maser Association may contest the amount, validity or application, in whole or in part, of any such liens or stop notices; subject, however, to the further requirement that neither the Covered Property nor any improvements nor any part 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 the Master Association then the Master Association shall promptly pay the amount required to be paid, together with all interest and penalties accrued thereon. The provisions of this Section4.4shall survive the termination of this Master Declaration.To the extent a Member is exercising its rights under Section4.3, the Member shall also be bound by the provisions of this Section4.4. ARTICLE 5 ASSESSMENTS AND LIENS 5.1Creation of Obligation for Assessments . Upon and after the Master Association Incorporation Date, all Regular Assessments and Special Assessments levied hereunder, together with any Additional Charges, shall be levied by the Master Association to the Members; provided that if the Master Association has been incorporated as a result of a Flight Association Event of Default, then notwithstanding anything to the contrary set forth in this Master Declaration, the Master Association shall levy the Assessments solely against the Phase1 Parcel and the Flight Association shall be responsible for the payment of all such Assessments unless and until the Phase2 Transfer Date occurs, at which time the Shared Expenses shall be allocated to the Flight Association and the Phase2 Association based upon the Allocable Shares. Each Assessment, together with any Additional Charges, shall be the absolute obligation of the Flight Association and, after the Phase2 Transfer Date, the Phase2 Association, respectively, to pay regardless of whether an Owner has paid its share of such Assessments to the Flight Associationor Phase2 Association, as applicable pursuant to its Association Declaration. Each Owner of a Lot,by acceptance of a deed or execution of a Ground Lease therefor, whether or not it shall be so expressed in such deed or Ground Lease, is deemed to covenant and agree, to pay (a)to the Flight Association if the Lot is either in the Phase1 Parcel or such Lot is in the Phase2 Parcel but has been annexed into the Flight Association, or (b)after the Phase2 Transfer Date, to the Phase2 Association if the Lot is in the Phase2 Parcel and has not been annexed into the Flight Association, as part of its payment obligations under the Flight Declaration or Phase2 Declaration, as applicable, all Assessments levied by the Master Association upon the Flight Association and Phase2 Association respectively. If the Phase2 Transfer Date occurs but the Phase2 Association has not been incorporated such obligations to pay such Assessments, until the incorporation of the Phase2 Association only, shall be the obligation of the Owner of the Phase2 Parcel. Notwithstanding any other provision of this Agreement, in no event shall any payment or, except as otherwise specifically set forth herein as an obligation of the City, shall any other obligations under this Master Declaration be the obligations of the City. Upon assignment of its obligations to the Phase2 Association and assumption of such obligations thereunder (which assignment and assumption shall occur when the Phase2 Association is incorporated) the Phase2 Owner shall be released from all obligations and liabilities underthis Master Declaration arising or accruing under this Master Declaration from and after the effective date of the applicable assignment. The obligations of the Phase2 Association to pay its Allocable Share of the Shared Expenses after the Phase2 Transfer Date occurs as specified in Section1.3shall apply regardless of whether the Phase2 Transfer Date occurs as to all or only a portion of the Phase2 Parcel. In addition to the foregoing,the Master Associationmay levy a Compliance Assessment or exercise its rights under Section5.9.2or a Member may levy a Compliance Assessment to the extent provided in Section5.5.3(b), in which case the Assessments levied hereunder shall be a charge oneach Lot and shall be a continuing lien upon the Lotagainst which each such Assessment is made, which lien shall be effective upon recordation of a Notice of Delinquent Assessments. -19- SMRH:481911721.23Master Declaration for Tustin Legacy Cornerstone I 06141725WR-246894 5.2Purpose of Assessments . The Assessments levied by the Master Association shall be used to perform the obligations and duties of the Master Association described in this Master Declaration and to undertake the powers of the Master Association under the Master Association Governing Documents. 5.3Commencement of Assessments . The obligation of the Flight Association to pay Assessments to the Master Association shall commence upon the Master Association Incorporation Date and the obligation of the Owner of the Phase2 Parcel (but in no event shall such obligation be the obligation of the City) or if incorporated, the Phase2 Association to pay Assessments to the Master Association shall commence upon the Phase2 Transfer Date (which date may be the same as the Master Association Incorporation Date if the Master Association is being incorporated if the Phase2 Assessment Commencement Date Transfer Date occurs) (""). Assessments for any partial months shall be prorated based upon a thirty (30) day month. 5.4Master Association Annual Budget .The Annual Budget for the Master Association for the first calendar year or balance thereof in which the Master Association Incorporation Date occurs shall be the then current operating budget of the Flight Association for the expenses related to the Roadway and Landscape Agreements Improvements which are included he definition of "Shared Expenses" in this Master Declaration which shall be increased to cover (a)additional expenses incurred for the incorporation of the Master Association and to include the costs associated with the establishment, management and administration of the Master Association, (b)the costs and expenses of obtaining the insurance required to be obtained by the Master Association under Article6,and(c)any increased costs required by the City if the Master Association is being incorporated as a result of a Flight Association Event of Default to remedy any deficiencies in maintenance by the Flight Association which caused the Flight Association Event of Default to occur. For each subsequent calendar year, the Master Board shall prepare and agree, as a Major Decision, upon the Annual Budget, at least ninety(90) days prior to the beginning of each calendar year or portion thereof. Failure to agree on an Annual Budget shall be an Operational Dispute pursuant to Section9.3.The failure by the Master Board to agree on the Annual Budget and/or to fix the Assessments hereunder before the expiration of any calendar year, for that or the next calendar year, shall not be deemed either a waiver or modification in any respect of theprovisions of this Master Declaration or a release of the Member or, to the extent applicable any Owner, from the obligation to pay the Assessments or any installment thereof for that or any subsequent calendar year, but the Assessment fixed for the preceding calendar year shall continue until a new Assessment is fixed, subject to any increases for insurance, utilities and other increased expenses beyond the control of the Master Board. 5.5Assessments . Payment of Regular AssessmentsRegular .Regular Assessments (" Assessments ") for each full calendar year after the Master Association Incorporation Date shall be established when the Annual Budget for that calendar year is adopted by the Master Board, or if such Annual Budget is not timely adopted, as otherwise determined as described in Section5.4. The Annual Budget shall be prepared in accordance with the provisions of Applicable Laws. Regular Assessments shall be levied on a calendar year basis, unless the Master Board elects a different accounting period. Special Assessments . If all of the Directors on the Master Board determine that the estimated total amount of funds necessary to defray the Shared Expenses of the Master Association for a given calendar year is or will become inadequate to meet expenses for any reason or if all of the Directors on the Master Board determine that it is necessary to make expenditures for capital improvements which are not included in the Annual Budget, the Master Association may levy a special Special Assessments assessment ("") in order to raise funds for such operating costs or capital improvements. Notwithstanding the foregoing, if the shortfall in the operating funds of the Master Association is due to the failure of a Member to pay its Allocable Share of the Assessments (including without limitation, as a result of a Mortgagee exercising its rights under Section7.2), then the Master Association shall be obligated to levy a Special Assessment and if the Master Board fails to do so within thirty (30) days after requesttherefor from a Member to levy the Special Assessment, any Member -20- SMRH:481911721.23Master Declaration for Tustin Legacy Cornerstone I 06141725WR-246894 (through its appointed Director or Directors on the Master Board), shall be permitted to do so upon behalf of the Master Association, and in such case, the levy of the Special Assessment shall not be a Major Decision. Compliance Assessments . (a)Levy of Compliance Assessments by Master Association . The Master Association may, in its own discretion at the request of any Member or Owner levy or shall levy, if so required by the City, or if the levy is necessary to cover any delinquencies by a Member, an Compliance Assessment assessment ("") against the Flight Association or Phase2 Association or directly against any Owner for expenses incurred for any of the following purposes: (a)expenses incurred by the Master Association resulting from damage to the Master Association Maintenance Areas caused by a Member or Owner or any of their Permittees, (b)expenses incurred by the Master Association in curing any default (including without limitation, a default in the payment of Assessments as and when due) by an Owner or Member of its obligations under this Master Declaration, (c)expenses incurred by the Master Association under any indemnification or other obligations under the Roadway and Landscape Agreements attributable to the actions or omissions of an Owner or Association or their Permittees, (d)expenses incurred by the Master Association pursuant to Section9.2of this Declaration, and/or (e)to cover any other expenses incurred by the Master Association as a result of the actions or omissions by a Compliance AssessmentEvents Member or Owner or their Permittees (""). Prior to the levy of a Compliance Assessment, the Master Association shall deliver written notice to the Owner or Association describing the Compliance Assessment Event which has occurred and the damage and/or costs incurred by the Master Association as a result thereof and the Owner or Association shall have ten (10)Business Days to pay the amounts owed to the Master Association andif the Owner or Association fails to pay the amounts owed to the Master Association as and when due, the Master Association shall levy the Compliance Assessment. Such Compliance Assessment shall include all costs incurred by the Master Association, including without limitation, all costs incurred in curing any Compliance Assessment Event and all Additional Charges related to the cure. If there is a shortfall in funds as a result of a failure by a Member (or Owner) to pay its Assessments when due and the Master Association has levied a Compliance Assessment as a result thereof, any amounts collected by the Master Association from the defaulting Member (or Owner) shall be credited to the account of the non-defaulting Member (or Owner) who paid the Special Assessment for its Allocable Share of such shortfalls in accordance with Section5.10.6. (b)Levy of Compliance Assessments by Members . If a Member or an Owner under the jurisdiction and controlof one of the Members causes a Compliance Assessment Event to occur and fails to pay such amounts or cure such default as and when required under this Master Declaration and the Master Association fails to levy a Compliance Assessment, the other Member acting through its appointed Director or Directors on the Master Board may, in addition to its other remedies described herein, exercise the same right to levy a Compliance Assessment as are granted to the Master Association described in Section5.5.3(a)above in conformance with the requirements set forth in Section5.5.3(a). 5.6Allocation of Assessments . All Regular Assessments and Special Assessments set forth in the Annual Budget shall be determined and assessed based upon the applicable Allocable Shares. 5.7Notice and Assessment Installment Due Dates . The due dates for the payment of Regular Assessments normally shall be the first day of each month unless some other due date is established by agreement of the Members, or unless the City is the Member, in which case so long as the City is the Member it may establish the due date for the payment which shall be no more frequent then once per month (but nothing contained herein is intended to infer or impose any obligation of the City to pay any Assessments hereunder). 5.8Additional Charges. As used in thisMaster Declaration, including this Article5, "Additional Charges" means the reasonable costs, fees, charges and expenditures actually incurred by -21- SMRH:481911721.23Master Declaration for Tustin Legacy Cornerstone I 06141725WR-246894 the Master Association in collecting and/or enforcing the payment of Assessments, including without limitation, (a)reasonable attorneys' fees and costs incurred in the event an attorney is employed to collect any Assessment or sum due, whether by suit or otherwise; (b)a late charge in an amount to be fixed by the Master Association to compensate the Master Association for additional collection costs incurred in the event any Assessment or other sum permitted to be levied under this Master Declaration is not paid when due or within any "grace" period established by this Master Declaration or Applicable Laws; (c)costs of suit and court costs incurred as are allowed by the court; (d)interest on delinquent Assessments or other amounts permitted to be levied under this Master Declaration at the Default Interest Rate; and (e)any such other additional documented costs that the Master Association actually incurs in the process of collecting delinquent Assessments. 5.9Collection of Assessments . Obligation of Members to Collect Assessments . Except as provided in Section5.9.2below, each Member shall have the obligation to collect Assessments from the Owners subject to its jurisdiction and to pay such Assessments to the Master Association. The Members shall have the absolute obligation to pay such Assessments regardless of whether an individual Owner, if any, subject to the jurisdiction of a Member has paid the amounts allocable to such Owner by the Member. Without limiting such absolute obligation to pay such amounts, the Members shall have the right to pursue any defaulting Owner in accordance with the terms of its Association Declaration. Election by Master Association to Collect Assessments . At any time the Master Board, with the approval of the majority of its Members may elect, unless the City is a Member in which case the City, as a Member may unilaterally elect, in its sole discretion, to collect pursuant to Section9.2.1or to cause the Master Association to collect the Assessments from each Owner directly in lieu of having the Members collect such Assessments, in which case (a)the Master Association shall provide notice thereof to the individual Owners or the Members shall deliver notice of such election by the Master Association to the Owners subject to its jurisdiction, (b)the Assessments shall be levied on the same basis as such assessments were levied by the applicable Member to its Owners and (c)such Assessments shall be paid by the Owners to the Master Association in the same manner as required above for the Members to pay such Assessments, including without limitation, the due date for payment set forth in Section5.7. 5.10Collection of Assessments and Remedies . Right of MasterAssociation to Pursue Remedies Against Members . If a Member is delinquent in the payment of Assessments levied by the Master Association against such Member and fails to cure such default within ten (10)Business Days after receipt of notice therefore from the Master Association, the Master Association may pursue all of its rights and remedies at law or equity, including without limitation the filing of a legal action or the right to attach the assets of the Flight Association or Phase2 Association ( if it is then a Member) to the extent allowed under Applicable Laws. Right of Master Association to File Liens and Pursue Remedies Against Owners . In the event the Master Association has levied a Compliance Assessment directly against a Member or an Owner or the Master Association has exercised its rights under Section5.9.2above to collect Assessments directly from the Owners, then the Master Association may pursue all of its rights and remedies at law or equity, including without limitation, the right to file a legal action and/or the right to file a lien against the Lot of a defaulting Owner as described in Section5.10.5below. Right of Individual Members to Levy Compliance Assessmentsor Pursue Other Remedies .If a Compliance Assessment Event has occurred and the Master Board fails to pursue its remedies hereunder against the Owner or Member responsible for the Compliance Assessment Event, any Member maypursue its remedies under law or equity which shall include without limitation, the right to act on behalf of the Master Association(through its appointed Director or Directors on the Master Board), in enforcing its remedies set forth in Section4.3or in curing a Compliance Assessment Event -22- SMRH:481911721.23Master Declaration for Tustin Legacy Cornerstone I 06141725WR-246894 including without limitation, levying a Compliance Assessment without the consent of the Directors representing the defaulting Member or the Member with jurisdiction over the defaulting Owner. Cumulative Remedies . In exercising its remedies granted herein to the Master Association or the Members, any Owner or the City, the rights and remedies shall be separate and cumulative and selected and used in any order as determined by the Master Association, Member, Owner or City without exclusion, waiver or prejudice. Lien Rights . If the Master Association is required to or has elected to exercise the right to levy and collect Assessments under Section5.9.2or levies a Compliance Assessment as described in Section5.5.3the Master Association may, in addition to its other remedies hereunder, foreclose by judicial proceedings or through the exercise of the power of sale pursuant to this Section5.10.5,to levy and enforce lien rights created. To the extent a Member is exercising its rights under Section5.10.3, the Member shall have the same rights as are granted to the Master Association and shall comply with the same procedures set forth below. Suit to recover a money judgment for unpaid Assessments together with allother Additional Charges shall be maintainable without foreclosing or waiving the lien rights. (a)Notice of Assessments and Foreclosure .The Master Association shall distribute a written notice regarding Assessments and foreclosure as set forth in California Civil Code Section6812. (b)Delinquent Assessments . In collecting delinquent Assessments, the Master Association shall comply with the requirements of California law, including, without limitation, Chapter7 of the Commercial and Industrial CID Act (California Civil Code Sections6800etseq.) (c)Creation of Lien . If there is a delinquency in the payment of any Assessment or installments of Assessments, any amounts that are delinquent, together with any Additional Charges, shall be a lien against the relevant Lot upon the recordation in the Official Records of Notice of Delinquent Assessment a notice of delinquent Assessment ("") as provided in, and subject to the requirements of, California Civil Code Sections6808 etseq., provided, that in no event shall any Lot owned by the City be subject to lien, except that if the City has entered into a Ground Lease, the interest in the Ground Lease shall be subject to such lien. (d)Notice of Default; Foreclosure . If the Master Association is entitled to file a lien as provided above, the Master Association may Record a Notice of Delinquent Assessment and, subject to the requirements and limitations of Chapter7 of the Commercial and Industrial CID Act (California Civil Code Sections6800 etseq.), including California Civil Code Sections6812 and 6814, may cause the Lot with respect to which a Notice of Delinquent Assessment has been recorded to be sold either in the same manner as a sale is conducted under California Civil Code Sections2924, 2924b and 2924c, or through judicial foreclosure[[1071,2229,1121,2277][10][,I,][Arial]]. [[1108,2229,2299,2276][10][,,][Arial]]However, as a condition precedent to the holding of any such sale under Section2924c, appropriate publication shall be made. In connection with any such sale, the Master Association is authorized to appoint a trustee for purposes of conducting the sale. If a delinquency is cured before sale of the Lot or before completing a judicial foreclosure, or if it is determined that a lien previously recorded against a Lotwas recorded in error, the Master Association shall apply payments and follow the procedures set forth in California Civil Code Section6800 etseq., as applicable. On becoming delinquent in the payment of any Assessments or installments of Assessments, each delinquent Owner shall be deemed to have absolutely assigned all rent, issues and profits of the Owner's Lot to the Master Association and shall further be deemed to have consented to the appointment of a receiver (which appointment shall, if such appointment is requested by any of its Members be enforced by the Master Association through specific performance). The Master Association, acting on behalf of the Owners, shall have the power to bid upon the Lot at foreclosure sale and to acquire, hold, lease, mortgage and convey the Lot and vote as an Owner of the Lot. Application of Payments . Any payments of sums due under this Articleshall first be applied to Assessments owed by the Member (or Owner) making such payment, and only after -23- SMRH:481911721.23Master Declaration for Tustin Legacy Cornerstone I 06141725WR-246894 Assessments owed by such Member (or Owner) have been paid in full shall the payments be applied to Additional Charges owed by such (Member or Owner). 5.11Inspection of Master Association Books and Records . Owners, Members and the City shall, upon at least ten (10)Business Days' notice to the Master Association, have the right to inspect the books and records of the Master Association at the office of the management company of the Master Association. Each Member may, upon at least ten (10)Business Days' notice to the Master Association cause an audit or inspection to be made of the books and financial records of the Master Association. 5.12Additional Charges .In addition to any other amounts due or any other relief or remedy exercised against a Member or Owner each Member and Owner agrees to pay Compliance Assessments and Additional Charges incurred or levied by the Master Board. 5.13Subordination of Lien to First Mortgages . The lien of Assessments which may be levied against an individual Lot herein shall be subordinate to the lien of any First Mortgages as provided in Section7.2below. 5.14No Offsets . All Assessments shall be payable in the amounts specified by the particular Assessment and no offsets againstsuch Assessments shall be permitted for any reason. ARTICLE 6 INSURANCE AND CASUALTY 6.1Insurance Under the Roadway and Landscape Agreements . From and after the Master Association Incorporation Date, the Master Association shall obtain all property insurance and liability insurance required to be obtained by the Responsible Association and, if such obligation is greater, the Responsible Party under the Roadway and Landscape Agreements and shall maintain such insurance in full force and effect as required under the terms of such Roadway and Landscape Agreements. All of the insurance required above shall conform to all insurance requirements set forth in the Roadway and Landscape Agreements. 6.2Additional Insurance . In addition to the insurance required under Section6.1, the Master Association shall, from and after the Master Association Incorporation Date, obtain all of the insurance described below. Workers' Compensation Insurance . The Master Association shall obtain and maintain statutory workers' compensation and employers' liability insurance in the amount of at least One Million Dollars ($1,000,000) for each accident for employees, if any, of the Master Association to the extent required by Applicable Laws. The Master Association shall require any independent contractor who performs any service for the Master Association to carry statutory workers compensation and employer's liability insurance in the amount of at least One Million Dollars ($1,000,000) for each accident. Crime Insurance . The Master Association or Master Association manager shall maintain a fidelity bond or commercial crime policy including coverage for employee dishonesty in an amount equal to at least the estimated maximum of funds, including reserves, in the custody of the Master Association ora manager. The fidelity bond shall name the Master Association as obligee and any commercial crime policy shall name the Master Association as the named insured and shall insure against loss by reason of the acts of the Master Board, officers and employees of the Master Association, and any manager and its employees, whether or not such Persons are compensated for their services. Directors and Officers Liability Insurance . The Master Association shall obtain liability for coverage for its officers and directors in an amount of not less than One Million Dollars ($1,000,000) each claim. -24- SMRH:481911721.23Master Declaration for Tustin Legacy Cornerstone I 06141725WR-246894 Other Master Association Insurance . The Master Association shall obtain and maintain such other insurance as the Master Board, in its reasonable discretion, considers necessary or advisable, or as is required by Applicable Laws. Policies . The insurance policies, certificates of insurance and detailed summaries of the policies of the Master Association shall be retained by the Master Association and be available for inspection by Members and the City at reasonable times. In addition to the foregoing, the Master Association shall provide to the Owners such information regarding the insurance of the Master Association as may be required by Applicable Laws. 6.3Master Board's Authority to Revise Insurance Requirements . Subject to any statutory insurance requirements, the Master Board shall have the power and right to adjust and modify the liability insurance requirements and other insurance rights set forth herein to require coverage and protection that is customarily carried by and reasonably available to prudent associations of projects similar in construction, quality, location and use. 6.4Casualty . From and after the Master Association Incorporation Date,in the event there is any damage to the Roadway and Utility Agreement Easement Areas and/or the Landscape Agreement Maintenance Areaswhich is not covered by the property insurance maintained by the MasterAssociation as required under Section6.1, the MasterAssociation shall have the obligations under the Roadway and Utility Agreement and/or Landscape Installation and Maintenance Agreementto restore such areasto the condition existing prior to the Casualty and the costs and expenses shall be included within the Shared Expenses. 6.5Indemnity . From and after the Master Association Incorporation Date, the Master Association shall protect, indemnify, defend and hold harmless the City and the City Indemnified Parties from and against any and all Claims arising out of or in connection with (a)the presence, activities or work on or use of the Master Association Maintenance Areas by the Master Association and/or its Representatives, (b)entry onto the Master Association Maintenance Areas by any Owner, Association and/or any of their Authorized Users in connection with the exercise of any rights or performance of any obligations under this Master Declaration, (c)any act or omission to act of any Master Association and/or its Authorized Users with respect to the Roadway and Utility Agreement Easement Areas or Landscape Agreement Maintenance Areas, (d)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 an Master Association or any of its Authorized Users with respect to the Roadway and Utility Agreement Easement Areas or Landscape Agreement Maintenance Areas and/or Roadway and Landscape Agreements Improvements located therein and (e)costs to remove or bond mechanics' 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 work performed or caused to be performed by the Master Association provided that the indemnity under clauses (a)through (d)shall not apply to the extent of the gross negligence or willful misconduct ofthe City or any City Indemnified Party. The provisions of this Sectionshall survive the termination of this Master Declaration only with respect to events occurring while this Master Declaration is in effect. Nothing contained herein shall limit the right of theAssociation to pursue any remedies at law or equity against any Owner or Member of such Association, in accordance with the terms of the MasterDeclaration for reimbursement, and each Memberand each Owner waives any right to assert defenses to any indemnity provided by the MasterAssociation to the extent the Master Association was required by the City Indemnified Parties or any court order to indemnify the City Indemnified Parties as a result of actions of such Owner or Association or their Permittees. If any Memberand/or any Owner fails to reimburse the MemberAssociation providing the indemnity for all costs and expenses incurred hereunder, including without limitation attorneys'fees and costs, the Master Association shall, if it lacks sufficient funds to meet its obligations, pursue any or all of its remedies provided hereunder, including without limitation, the remedies under Section9.2. The indemnity set forth in this Section6.5shall survive the termination of thisMaster Declaration. -25- SMRH:481911721.23Master Declaration for Tustin Legacy Cornerstone I 06141725WR-246894 ARTICLE 7 RIGHTS OF MORTGAGEES 7.1Conflict . Notwithstanding any contrary provision contained elsewhere in the Master Association Governing Documents,the provisions of this Articleshall control with respect to the rights and obligations of Mortgagees as specified herein. 7.2Subordination of Lien to First Mortgages; Liability for Unpaid Assessments . If any Lot is encumbered by a First Mortgage made in good faith and for value and the Master Association is levying Assessments directly to a Lot pursuant to Section5.9.2, or levying a Compliance Assessment as described in Section5.5.3or a Member is levying a Compliance Assessment or exercising its rights pursuant to Section5.10.3, the foreclosure of any lien created by any provision set forth in this Master Declaration by power of sale judicial foreclosure for Assessments, or installments of Assessments, shall not affect or impair the lien of the First Mortgage. The lien of Assessments shall be subordinate to the lien of any First Mortgage now or hereafter placed upon any Lot subject to Assessment. A First Mortgagee or other purchaser who obtains title to a Lot pursuant to the remedies provided in the First Mortgage shall be obligated to pay any Assessments that become due and payable on or after the date it acquires title to the Lot and as long as it remains in title, including any Special Assessments or Compliance Assessments levied by the Master Association or a Member acting on behalf of the Master Association pursuant to Section5.5.2to raise funds needed because of uncollected delinquent Assessments. 7.3Rights on Default . In case of default by any Owner, a First Mortgagee may pay any Assessments or take any action reasonably necessary to cure any other default by such Ownerwith the same effect as such cure by the Owner itself. ARTICLE 8 AMENDMENTS 8.1Amendments . Except as may otherwise be stated in this Master Declaration, this Master Declaration may be amended at any time and from time to time with the approval of all of its Members. Such amendment shall become effective upon the recording of an amendment signed and acknowledged by theMembers with a statement stating that such votes or approval by written ballot have been obtained. 8.2City's Consent . Notwithstanding that the City is not then a Member, any amendment of this Master Declaration which alters, modifies, terminates or changes the Master Association'sobligations to maintain the Master Association Maintenance Areas or other provisions of this Master Declaration in which City has an interest, including, without limitation,the City's right to enforce this Master Declaration pursuant to Section9.2.1, the provisions set forth inSection3.7.3(Restrict Access),Section4.3(Rights to Take-OverMaintenance Obligations),Sections6.1 through 6.4(Insuranceand Casualty),Section6.5 (Indemnity),Section9.1(Term)andSection11.3(City as Third Party Beneficiary)requires the City's written consent, which written consent shall be in accordance with this Section.Any written request to the City for consent to an amendment to this Master Declaration, or a written request for consent to a modification for which City approval is required, shall be provided to theCity in accordance with the notice provisions of Section11.7. 8.3Cooperation . If the Phase2 Transfer Date occurs, the Master Association, each Association, the City and thePhase2 Owner shall reasonably cooperate with each other to make any modifications to this Master Declaration as may be required to reflect the development plan for the Phase2 Parcel, but in no event shall the Owner of the Phase1 Parcel or the Flight Association or any Owner of a Lot within the Phase1 Parcel have any obligation for any costs of installation of any Easement Improvements(as defined in the Roadway and Utility Agreement) to the extent provided under Section 6.2 of the Roadway and Utility Agreementor Landscape Improvements (as defined in the Landscape Installation and Maintenance Agreement) to the extent provided under Section 18 of the Landscape Installation and Maintenance Agreement. -26- SMRH:481911721.23Master Declaration for Tustin Legacy Cornerstone I 06141725WR-246894 8.4Reliance on Amendments . Any amendments made in accordance with the terms of this Master Declaration shall be presumed valid by anyone relying on them in good faith. ARTICLE 9 TERM AND ENFORCEMENT 9.1Term . The covenants, conditions and restrictions of this Master Declaration shall run with and bind the Covered Property and shall inure to the benefit of and be enforceable by the Master Association and any Member and their respective legal representatives, heirs, successors and assigns and the City and its governmental successors,for a term of ninety-nine(99) years from the date this Master Declaration is recorded, after which time said easements, covenants, conditions and restrictions shall be automatically extended for successive periods of ten(10)years each, unless an instrument, signed by the Membersand the City has been recorded, at least one(1)year prior to the endof any such period in the manner required for a conveyance of real property, in which case it is agreed that this Master Declaration shall terminate at the end of the then applicable term but theeasements created herein shall survive any such termination. Notwithstanding the foregoing, in the event the entire Phase2 Parcel is annexed to the Flight Declaration, this Master Declaration shall automatically terminate without further action by the Flight Association or the City or any Owner provided that the City, the Flight Association and/or the Phase2 Owner shall reasonably cooperate with each other to Record a quitclaim or termination of this Master Declaration if so requested by the Flight Association, any Owner or the City. 9.2Enforcement and Nonwaiver . City Remedies .In the event of a breach ofany provision of this Master Declaration by any Person,the City, regardless of whether it then is or is not a Member,may demand by Default Notice written notice to the Master Association ("") that the violation be cured. Except for utility service interruptions or any otheremergencies which threaten imminent damage or injury to persons or property which shall not require advance notice or cure periods hereunder, if the Master Association does not cure the violation within thirty (30) days after receipt of the Default Notice, or if such default is of a kind which cannot reasonably be cured within thirty (30) days, and the Master Association does not within such thirty (30) day period commence to cure such default and diligently thereafter prosecute such cure to completion, then City shall have the right, but not the obligation, to (a)institutelegal action against the Master Association for specific performance, injunction, declaratory relief, damages, or any other remedy provided by law, (b)pay any sum owed by the Master Association to the Person entitled to such payment and/or (c)enter upon the Master Association Maintenance Areas (and upon the applicable portions of the Phase1 Parcel or Phase2 Parcel, to the extent reasonably necessary to enforce its rights hereunder) and to summarily abate, remove or otherwise remedy any improvement, and/or repair or modify any improvement which violates the terms of this Master Declarationand/or perform any obligation of the Master Association under this Master Declaration to be performed thereon. The Master Association shall pay to the City, within thirty (30) calendar days of written demand by City (which demand is accompanied by appropriate supporting documentation), an amount equal 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 hourlywages and benefits reasonably allocable to the time expended by City in taking 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 by the Cityand allattorneys' fees incurred by the City in enforcing its rights under this Master Declaration. The rights and remedies given to the City by this Master Declaration shall be deemed to be cumulative and no one of such rights and remedies shall be exclusive ofany of the others, or of any other right or remedy at law or in equity which City might otherwise have by virtue ofa default under this Master Declarationand 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; provided however that the City hereby expressly waives, releases and relinquishes any and all rights to any expectation, anticipation, indirect, consequential, exemplary or punitive damages. In no event shall the City haveany responsibility for any liens that may be filed as a result of the work performed by the City hereunder.It shall be the responsibility of the Master Association to remove or cause the removal of any liens for work performed by the City hereunder. -27- SMRH:481911721.23Master Declaration for Tustin Legacy Cornerstone I 06141725WR-246894 Master Association Remedies . The Master Association, acting through the Master Board, shall have the right to enforce, by any proceeding at law or in equity, all restrictions, conditions, covenants, reservations, liens, and charges now or hereafter imposed by the provisions of this Master Declaration, and to the extent the Master Association prevails in such action shall be entitled to recover reasonable attorneys' fees and costs as are ordered by the court. Failure by the Master Association to enforce any covenant or restriction herein contained shall in no event be deemed a waiver of the right to do so thereafter. Member Remedies . Each Member shall be entitled to enforce by any proceeding at law or in equity, (a)the restrictions, conditions, covenants, reservations, liens, and charges, now or hereafter imposed by the provisions of this Master Declaration, as such provisions pertain to the rights of the Member with respect to the use and operation of the Master Association Maintenance Areas, (b)any rights expressly granted to the Member, and (c)any obligations of the Master Association under this Master Declaration, and to the extent such Member prevails in such action, such Member shall be entitled to recover reasonable attorneys' fees and costs as are ordered by the court. Each Member shall also have the rights under Section5.10.3to impose Compliance Assessments and the rights to pursue its remedies under Section5.10. Procedure for Enforcement . Notwithstanding anything to the contrary set forth in Section9.2.2and Section9.2.3in enforcing any action under the Master Association Governing Documents for injunctive relief, declaratory relief and/or monetary damages (excluding actions in Small Claims Court), the Master Association, the Members and the Owners shall comply with the applicable notice and delivery requirements and other provisions of the Commercial and Industrial Common Interest Development Act, California Civil Code Section6500 etseq. relating to such enforcement action. Limitation and Damages . Notwithstanding anything to the contrary set forth in this Master Declaration, in no event shall any action for damages include consequential, special or punitive damages. Attorneys'Fees . If any Association, Member, Owner or the City institutes any action, suit, counterclaim or other proceeding for any relief against another Owner, Member, Association, Action or the Master Association, declaratory or otherwise (collectively an ""), to enforce the terms hereof or to declare rights hereunder, then the Prevailing Party (as defined below) in such Action shall be entitled to have and recover of and from the non-Prevailing Party ("non-Prevailing Party") all costs and expenses of the Action, including (a)the Prevailing Party's reasonable attorneys'fees which, regardless of which Party is the Prevailing Party, shall be payable at the actual contractual hourly rate for City's litigation counsel at the time the fees were incurred, but in no event more than $200.00 per hour and (b)costs actually incurred in bringing and prosecuting such Action and/or enforcing any judgment, order, ruling or Decision 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 (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 feesall costs incurred in the following: (a)post judgment motions and collection actions; (b)contempt proceedings; (c)garnishment, levy, debtor and third party examinations; (d)discovery; (e)any bankruptcy, reorganization, insolvency, composition, restructuring, dissolution, liquidation, receivership, assignment for the benefit of creditors, or custodianship action or proceeding under any federal or state law with respect to any borrower, any loan guarantor of any of the indebtedness, any of their respective properties, or any of their respective partners, members, officers, directors, or shareholders; and (f)appeals of any order or judgment. Prevailing Party ""within the meaning of this Section9.2.6includesan Association, Member, Owner or the City which agrees to dismiss an Action in consideration for the other'spayment of the amounts allegedly due or performance of the covenants allegedly breached, or obtains substantially the relief sought by it. The provisions of this Section9.2.6shall survive the expiration or termination of this Master Declaration. -28- SMRH:481911721.23Master Declaration for Tustin Legacy Cornerstone I 06141725WR-246894 9.3Operational Disputes . Any Operational Dispute (defined below) asserted by a DisputingParty Member, and/or the Master Association (individually "" and collectively, with the Non-Disputing Parties Person(s)against which an OperationalDispute Notice is filed ""), shall be resolved in accordance with the procedures set forth below; provided however that in no event shall the City (whether or not it is then a Member) when acting in its governmental capacity or enforcing its remedies under Section9.2.1of this Master Declaration, be obligated to resolve any dispute pursuant to the provisions of this Sectionand if the City is a party to any dispute that would otherwise be subject to the provisions of this Sectionbut elects not to utilize the provisions of this section to resolve such dispute, the City shall be entitled to pursue the dispute in a court of law or, upon agreement by the City and any other parties to such dispute, in any alternative tribunal or pursuant to arbitration. As used herein, Operational Dispute "" means any dispute (a)regarding any Major Decisions, (b)the Shared Expenses, (c)the establishment of the Annual Budget or the costs thereunder to be paid by any Member or Owner, (d)any resolution ofor default in the observance, performance or compliance with the Maintenance Standards or (e)the levy of any Assessment hereunder under Section5.10.3, for which such Disputing Party provides written notice to the Master Association, and the other Members of an Operational Dispute Operational Dispute Notice (""), The Disputing Parties shall consult and negotiate with each other in good faith to reach a just and equitable solution satisfactory to all Disputing Parties. If the Operational Dispute cannot be settled through such discussions within a period of fifteen(15)businessdaysafter any Disputing Partydeliversan Operational Dispute Notice or for such longer period as the Disputing Parties Discussion Period may otherwise agree (""), the matter shall be referred to and resolved by a Resolution Party or Resolution Parties as described below. For a period of ten (10)business days from the expiration of the Discussion Period, the Disputing Parties shall seek to jointly select an independent management company that (i)has at least five(5)years' experience in managing mid-rise office buildings in a commercial campus environment, (ii)is otherwise qualified to resolve the issue in question, and (iii)is not prior to the date of appointment or within two(2)years prior to such date employed or engaged, either directly or indirectly, as a consultant in connection with any other matter by any of the Disputing Parties or Resolution Party any other P or affiliate of the Person attempting to appoint such Person ("".). If the Disputing Parties cannot agree upon a single Resolution Party, then the Operational Dispute shall be resolved by three Resolution Parties who shall be selected as follows. Within ten(10)Business Days after the expiration of the period forselection of a single Resolution Party, the Disputing Party shall select a Resolution Party and the Non-Disputing Parties shall select a second Resolution Party, and within ten (10)Business Days thereafter, the two(2)Resolution Parties so selected shall select the third Resolution Party. If any Disputing Party fails to select a Resolution Party or the two(2)Resolution Parties selected fail to select a third Resolution Party within such ten(10)Business Day period, then the third Resolution Party shall be appointed by the American Arbitration Association. The Resolution Party(ies) shall comply with and shall be subject to all standards and requirements related to neutral arbitrators under Applicable Laws, including but not limited to the provisions of Title 9 of Part 3 of the California Code of Civil Procedure, beginning with Section1280, and any successor statutes, as the same may be amended from California Arbitration Laws time to time (""). The Operational Dispute shall be decided by the Resolution Parties in accordance with California Arbitration Laws, except as expressly set forth in this Section9.3or otherwise agreed by the Disputing Parties in writing. The powers and duties of a neutral arbitrator under California Arbitration Laws may be exercised by the Resolution Party, or where there are three Resolution Parties, the majority of the Resolution Parties, provided that reasonable notice of all proceedings has been given to all Resolution Parties. Depositions may be taken in the manner prescribed by California Code of Civil Procedure Section1283.05. The Resolution Party(ies) shall set the time and place of the hearing, taking into consideration the availability of the Disputing Parties (and, if applicable, within ten(10)days after appointment of the third Resolution Party, and shall provide to each of the Disputing Parties no less than thirty(30) days' written notice of the time and place of such hearing. Each Disputing Party shall provide to the other Disputing Parties a list of the witnesses such Disputing Party intends to call and designating which witnesses will be called as expert witnesses no less than fifteen(15)calendar days prior to the date of the hearing, unless otherwise agreed in writing and approved by the Resolution Party,or if there are three Resolution Parties, by a majority of the Resolution Parties, provided that the testimony of an unlisted witness shall not be barred upon a showing of good cause, as determined by a majority of the Resolution Parties. The decision ofthe Resolution Parties shall be made by the Resolution Party, or if there are three Resolution Parties, by a majority of the Resolution Parties, within ten(10)days after the conclusion of the hearing. Such decision of the Resolution Party(ies) shall be -29- SMRH:481911721.23Master Declaration for Tustin Legacy Cornerstone I 06141725WR-246894 binding on the Member, Owner and/or Master Association, may include both monetary damages and an award of equitable relief (including, but not limited to, specific performance and injunctive relief) and may be enforced by the Prevailing Party (as defined in Section9.2.6) in a court of competent jurisdiction. Each Disputing Party involved with the Operational Dispute shall pay the initial cost (or its pro rata portion) of the Resolution Party retained by it and one half of the Costs of the third Resolution Party, but the Prevailing Party, if any, shall be reimbursed for the Costs and expenses incurred by it in connection with the Operational Dispute. Notwithstanding the foregoing, where a Member or the City believes that the Master Association's or a Member's or Owner's noncompliance with its obligations under this Master Declaration requires injunctive relief pursuant to then applicable legal standards for temporary restraining orders in the State of California, such Member or the City may seek such injunctive relief in a court of competent jurisdiction and is not required to first initiate the Operational Dispute process. 9.4General Enforcement by the City . The City, whether or not it is then a Member,shall have the right, but not the obligation, to enforce the provisions of this Master Declaration if the Master Associationdoes not do so within a reasonable time after written request by the City. The City shall also have the right (but not the obligation) to resolve any disputes between itself and a Member and/or the Master Association in accordance with the Operational Dispute provisions set forth in Section9.3. ARTICLE 10 COVENANTS OF COOPERATION AND ADDITIONAL COVENANTS 10.1No Racial Restriction . No Owner shall execute or cause to be recorded any instrument which imposes a restriction upon the sale, leasing or occupancy of such Owner's Lot on the basis of race, sex, sexual orientation, color or creed. 10.2Good Faith and Cooperation . The Master Association shall not discriminate against any Member or Owner in performing any of its obligations or in exercising its rights under this Master Declaration. 10.3Estoppel Certificates . Issuance by Owners and Associations .Each Owner and each Association hereby covenantsthat within ten (10)business days of the written request of any Owner or Association or the City it will issue to such requesting Person an Estoppel Certificate stating: (a)whether the Person to whichthe request has been directed knows of any default under this Master Declaration and if there are known defaults specifying the nature thereof; (b)whether to its knowledge this Master Declaration has been modified, or amended in any way (and if it has, then stating the nature thereof); and (c)whether to the stating Person's knowledge this Agreement is as of that date is in full force and effect. Issuance by City . From and after the termination of the DDA as to anyMaster Association Maintenance Areas (including by issuance by the City of a Certificate of Compliance with respect to the Lot upon which such Master Association Maintenance Areas are located) (it being understood that prior to such termination, the provisions of Section2.2.6of the DDA shall govern City estoppels), the City, hereby covenantsthat within ten (10)business days of the written request of any Member or Associationissued not more than annually or more often only in connection with a transfer by the requesting Person of its interest in any Lot, that it shall issue to the Person making the request an estoppel certificate stating: (a)whether the Person to whichthe request has been directed knows of any default or event of default under this Master Declaration and if there are known defaults or events of default specifying the nature thereof; (b)whether to its knowledge this Master Declaration has been modified, or amended in any way (and if it has, then stating the nature thereof); and (c)whether to the City's knowledge this Master Declaration is as of that date is in full force and effect. 10.4Reasonable Consents . Except as otherwise set forth in this Master Declaration, all consents and approvals of any of the Membersshall not be unreasonably withheld, conditioned or delayed; provided, however, that nothing stated in this Section10.4shall be interpreted to require a Member to consent or give such Member's approval to matters resulting in such Member relinquishing -30- SMRH:481911721.23Master Declaration for Tustin Legacy Cornerstone I 06141725WR-246894 rights or benefits set forth in this Master Declaration. Any disapproval of or failure of consent to any matter hereunder shall be in writing and shall state in reasonable detail the reason or reasons therefor. 10.5Requirements for Consent . Except as expressly provided otherwise in this Master Declaration, to the extent that the consent of the Members is expressly required under this Master Declaration, such Member shall have fifteen (15)days to provide notice of approval or disapproval of the item for which consent is required. 10.6Master Association Limitation on Liability . Except to the extent of any available insurance proceeds hereunder, or as otherwise provided to the contrary in this Master Declaration, the Master Association and its Authorized Users (including, without limitation, any property manager appointed by the Master Association) shall not be liable to any Member or Owner or occupant of any portion of a Lot for any damages caused for reasons beyond the reasonable control of the Master Association. Such same limitation shall apply to any Member exercising its rights under Section4.3of this Master Declaration. No diminution or abatement of any Assessments shall be claimed or allowed for inconvenience or discomfort arising from the making of repairs or improvements to the Master Association Maintenance Areas, or from any action taken by the Master Association or a Member to comply with any Applicable Laws. ARTICLE 11 GENERAL PROVISIONS 11.1Excuse for Non-Performance . The Master Association and the City shall be excused from performing any obligation or undertaking provided in this Master Declaration, in the event and so long as the performance of any such obligation is prevented or delayed, retarded, or hindered by act of God, including, without limitation, inclement weather, 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 suppliesin 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. 11.2Effect on Third Parties . Except as herein specifically provided, no rights or privileges conferred upon the Master Association, Members and/or the Owners under this Master Declaration shall inure to the benefit of any Person nor shall any other Person be deemed to be a third party beneficiary of anyof the provisions contained herein. 11.3City as Third Party Beneficiary .The City is intended as a third party beneficiary of the provisions of this Master Declaration regardless of whether the City owns any portion of the Parcels and/or the Perimeter Landscape Area. 11.4Headings . The headings used in this Master Declaration are for convenience only and are not to be used to interpret the meaning of any of the provisions of this Master Declaration. 11.5Cumulative Remedies; No Waiver . Each remedy provided for in this Master Declarationshall be cumulative and not exclusive. Failure to exercise any remedy provided for in this Master Declaration shall not, under any circumstances, be construed as a waiver. 11.6Liberal Construction . The provisions of this Master Declaration shall be liberally construed to effectuate its purpose so that the development upon the Parcels shall operate as acreative office campus with food hall. 11.7Notice .All notices, demands, consents, requests and other communications required or permitted to be given under this Master Declaration shall be in writing and shall be deemed conclusively to have been duly given (a)when hand delivered to the City, the applicable Association or Owner; (b)three(3)business days after such notice has been sent by U.S. Postal Service via certified mail, -31- SMRH:481911721.23Master Declaration for Tustin Legacy Cornerstone I 06141725WR-246894 return receipt requested, postage prepaid, and addressed to the Owner, Member, the Master Association or the City as set forth below; (c)the next Business Day after such notice has been deposited with an overnight delivery service reasonably approved by the Master Board (Federal Express, Express, United Parcel Service and U.S. Postal Service are deemed approved by the Master Board), postage prepaid, addressed tothe Owner, the City or the applicable Association to whom notice is being sent as set forth below with next-business-day delivery guaranteed, provided that the senderreceives 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 Section11.7other than by facsimile or email (provided that the recipient need not receive such duplicate copy prior to any deadline set forth herein); or (ii)the recipient 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:Jeffrey C. Parker, City Manager City of Tustin 300 Centennial Way Tustin, CA 92780 Fax: (714) 838-1602 Email: jparker@tustinca.org With a copy to:David Kendig Woodruff Spradlin&Smart, APC 555 Anton Boulevard, #1200 Costa Mesa, CA 92626 Fax: (714) 415-1183 Email: dkendig@wss-law.com Phase1 Owner:David Binswanger and Matt Howell Flight Venture LLC c/o Lincoln Property Company Commercial, Inc. 915 Wilshire Boulevard, Suite2050 LosAngeles, CA 90017 Fax: (213) 538-0901 Email: dbinswanger@lpc.comand matt.howell@lpc.com With a copy to:Parke Miller Lincoln Property Company Commercial, Inc. 114 Pacifica, Suite370 Irvine, CA 92618 Fax: (949) 333-2131 Email: pmiller@lpc.com With a copy to:Gregory S. Courtwright Lincoln Property Company Commercial, Inc. 2000 McKinney Avenue, Suite1000 Dallas, TX 75201 Fax: (214) 740-3460 Email: gcourtwright@lpc.com -32- SMRH:481911721.23Master Declaration for Tustin Legacy Cornerstone I 06141725WR-246894 With a copy to:Mark Potter Alcion Ventures One Post Office Square, Suite3150 Boston, MA 02109 Fax: (617) 603-1001 E-mail: mpotter@alcionventures.com With a copy to:Amy Forbes and Douglas Champion Gibson, Dunn&Crutcher LLP 333 South Grand Avenue, Suite4900 LosAngeles, CA 90071 Fax: (213) 229-6151 / (213) 229-6128 E-mail: aforbes@gibsondunn.com/ dchampion@gibsondunn.com With a copy to:Andrew C. Sucoff Goodwin Procter LLP 100 Northern Ave. Boston, MA 02210 Fax: (617) 523-1231 Email:asucoff@goodwinlaw.com Any of the foregoing may by written notice to the Members, Associations and the City in the manner specified in this Master Declaration change the address to which notices to it shall be delivered; provided that notwithstanding any other provision of this Master Declaration to the contrary, City shall be entitled to deliver notices to any Association then formed to the address for such Association contained in the Association Declaration or amendment thereto last Recordedin the official records of Orange County, California, and no change to the name or address of any Association shall be deemed effective or binding on the City unless it is contained in a Recorded Association Declaration or amendment thereof with a copy delivered to the City Clerk and to the City in accordance withthisSection11.7,or if no address is specified to the Person delegated as the agent for service of process for the applicable Association. 11.8Joint and Several Liability . When an Owner of a Lot is comprised of more than one(1)Person, each such Person shall, to the extent Assessment are levied directly to such Lot, be jointly and severally liable for payment of Assessments, and performance of all obligations (including, without limitation, indemnification obligations) arising under any provision of the Master Association Governing Documents with respect to such Lot or the ownershipthereof. 11.9Number; Gender . The singular shall include the plural and the plural the singular unless the context requires the contrary, and the masculine, feminine and neuter shall each include the masculine, feminine or neuter, as the context requires. 11.10Effect of DDA . Nothing contained in this Master Declaration is intended to amend or supersede the provisions of the DDA. 11.11Statutory References . All references in this Master Declaration or any of the Master Association Governing Documents to various statutes, codes, regulations, ordinances and other laws shall be deemed to include those laws in effect as of the date ofthis Master Declaration and any successor laws as may be amended from time to time. 11.12Applicable Laws . In the event of any conflict between this Master Declaration and the requirements imposed under any Applicable Laws, the more restrictive provisions of the Applicable Laws or Declaration, as applicable, shall control. 11.13Partial Invalidity .If any term, covenant or condition of thisMaster Declarationor its application to any Persons or circumstances shall be held to be invalid or unenforceable, the remainder of -33- SMRH:481911721.23Master Declaration for Tustin Legacy Cornerstone I 06141725WR-246894 thisMaster Declarationand the application of such term or provision to other Persons or circumstances shall not be effected, and each term hereof shall be valid and enforceable to the fullest extent permitted by law. 11.14Governing Law .This Master Declarationis entered into and shall be governed by and construed in accordance with the laws of the State of California.Venue for any action brought to enforce or interpret the terms of thisMasterDeclarationshall be in the County of Orange, California. 11.15Waiver and Default . The waiver by a Member or the Master Association of the performance of any provision of this Master Declaration shall not invalidate this Master Declaration nor shall it be considered a waiver by it of any other provision under this Master Declaration or of any subsequent breach by the other Person of the same provision. 11.16References to Sections, Clauses and Exhibits . Unless otherwise indicated, references in this Master Declaration to sections, clauses and exhibits are to the same contained in or attached to this Master Declaration and all exhibits referenced in this Master Declaration are incorporated in this Master Declaration by this reference as though fully set forth in this Section. All depictions on the Site Plan attached hereto as Exhibit"B"are attached as pictorial illustrations of the approximate locations of the Phase1 Parcel and Phase2 Parcel and other areas depicted on the Site Plan.In the event of any conflict between the pictorial illustrations on the Site Planand the actual locations, the actual locations shall control. IN WITNESS WHEREOF, Phase1 Owner and the City have executed this Master Declaration as of the date first above written. Phase1 Owner : Flight PhaseI Owner, LLC, a Delaware limited liability company By: Name: Title: Authorized Signatory CITY OF TUSTIN: By: Jeffrey C. Parker, City Manager ATTEST: By Erica N. Rabe City Clerk -34- SMRH:481911721.23Master Declaration for Tustin Legacy Cornerstone I 06141725WR-246894 APPROVED AS TO FORM By: David Kendig, City Attorney Armbruster Goldsmith&Delvac LLP Special Real Estate Counsel to the City By: Amy E. Freilich -35- SMRH:481911721.23Master Declaration for Tustin Legacy Cornerstone I 06141725WR-246894 A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. State of _____________________) County of _________________) On ____________________, before me, ____________________________, a Notary Public, personally appeared _______________________________, personally known to me (or 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 ______________ that the foregoing paragraphis true and correct. WITNESS my hand and official seal. Signature A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. State of _____________________) County of _________________) On ____________________, before me, ____________________________, a Notary Public, personally appeared _______________________________, personally known to me (or 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 ______________ that the foregoing paragraphis true and correct. WITNESS my hand and official seal. Signature SMRH:481911721.23Master Declaration for Tustin Legacy Cornerstone I 06141725WR-246894 A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. State of _____________________) County of _________________) On ____________________, before me, ____________________________, a Notary Public, personally appeared _______________________________, personally known to me (or 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 ______________ that the foregoing paragraphis true and correct. WITNESS my hand and official seal. Signature SMRH:481911721.23Master Declaration for Tustin Legacy Cornerstone I 06141725WR-246894 EXHIBITS EXHIBIT "A".............................................................................Legal Description of the Phase1 Parcel EXHIBIT "B"..............................................................................................................................Site Plan EXHIBIT "C".............................................................................Legal Description of the Phase2 Parcel EXHIBIT "D"...................................................................Articlesof Incorporation of Master Association EXHIBIT "E".............................................................................................Bylaws of Master Association SMRH:481911721.23Master Declaration for Tustin Legacy Cornerstone I 06141725WR-246894 EXHIBIT "A" LEGAL DESCRIPTION OF THE PHASE 1 PARCEL Legal Description (Phase 1) Real property in the City of Tustin, County of Orange, State of California, described as follows: LOTS 1 THROUGH 10, INCLUSIVE, OF TRACT NO. 18082, AS SHOWN BY TRACT MAP ON FILE IN BOOK _____, PAGES _____, INCLUSIVE, OF TRACT MAPS, RECORDS OF ORANGE COUNTY, CALIFORNIA. EXCEPTING THEREFROM ANY AND ALL OIL, OIL RIGHTS, MINERALS, MINERAL RIGHTS, NATURAL GAS, NATURAL GAS RIGHTS AND OTHER HYDROCARBONS BY WHATSOEVER NAME KNOWN, GEOTHERMAL STEAM AND ALL PRODUCTS DERIVED FROM ANY OF THE FOREGOING THAT MAY BE WITHIN OR UNDER THE LAND, TOGETHER WITH THE PERPETUAL RIGHT OF DRILLING, MINING, EXPLORING FOR AND STORING IN AND REMOVING THE SAME FROM THE LAND OR ANY OTHER LAND, INCLUDING THE RIGHT TO WHIPSTOCK OR DIRECTIONALLY DRILL AND MINE FROM LANDSOTHER THAN THE LAND, OIL OR GAS WELLS, TUNNELS AND SHAFTS INTO, THROUGH OR ACROSS THE SUBSURFACE OF THE LAND 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 LAND IN THE EXERCISE OF SUCH RIGHTS OR OTHERWISE ADVERSELY AFFECT THE USE OR OPERATION OF THE LAND OR THE STRUCTURAL INTEGRITY OF ANY IMPROVEMENTS ON THE LAND, AS RESERVED IN THE QUITCLAIM DEED FROM THE CITY OF TUSTIN, CALIFORNIA, RECORDED ________, 2017 AS INSTRUMENT NO. __________________ OF OFFICIAL RECORDS. ALSO EXCEPTING THEREFROM ANY AND ALL WATER, WATER RIGHTS OR INTERESTS THEREIN APPURTENANT OR RELATING TO THE LAND OR OWNED OR USED BY THE GRANTOR IN CONNECTION WITH OR WITH RESPECT TO THE LAND NO MATTER HOW ACQUIRED BY THE GRANTOR, 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 LAND, TO STORE THE SAME BENEATH THE SURFACE OF THE LAND AND TO DIVERT OR OTHERWISE UTILIZE SUCH WATER, RIGHTS OR INTERESTS ON ANY OTHER PROPERTY OWNED OR LEASED BY GRANTOR; BUT WITHOUT, HOWEVER, THE RIGHT TO ENTER UPON OR USE THE SURFACE OF THE LAND IN THE EXERCISE OF SUCH RIGHTS OR OTHERWISE ADVERSELY AFFECT THE USE OR OPERATION OF THE LAND OR THE STRUCTURAL INTEGRITY OF ANY IMPROVEMENTS ON THE LAND, AS RESERVED Exhibit "A" SMRH:481911721.23Master Declaration for Tustin Legacy Cornerstone I 06141725WR-246894 IN THE QUITCLAIM DEED FROM THE CITY OF TUSTIN, CALIFORNIA, RECORDED ___________, 2017 AS INSTRUMENT NO. _______________ OF OFFICIAL RECORDS. * Exhibit "A" SMRH:481911721.23Master Declaration for Tustin Legacy Cornerstone I 06141725WR-246894 EXHIBIT "B" Site Plan [SeeAttached] All items and location of items are shown for informational purposes only and should not be relied upon for content, precise design or dimension.The actual conditions will control.The attached Site Plan is for illustrative purposes only and depicts approximate dimensions. Exhibit "B" SMRH:481911721.23Master Declaration for Tustin Legacy Cornerstone I 06141725WR-246894 Exhibit "B" SMRH:481911721.23Master Declaration for Tustin Legacy Cornerstone I 06141725WR-246894 EXHIBIT "C" LEGAL DESCRIPTION OF THE PHASE 2 PARCEL Phase2 Parcel : Legal Description (Phase 2) Real property in the City of Tustin, County of Orange, State of California, described as follows: PARCEL 2 OF PARCEL MAP NO. 2015-168, AS SHOWN ON A MAP FILED IN BOOK 388, PAGES 26 AND 27 OF PARCEL MAPS, RECORDS OF ORANGE COUNTY, CALIFORNIA; EXCEPTING THEREFROM ANY AND ALL OIL, OIL RIGHTS, MINERALS, MINERAL RIGHTS, NATURAL GAS, NATURAL GAS RIGHTS AND OTHER HYDROCARBONS BY WHATSOEVER NAME KNOWN, GEOTHERMAL STEAM AND ALL PRODUCTS DERIVED FROM ANY OF THE FOREGOING THAT MAY BE WITHIN OR UNDER THE LAND, TOGETHER WITH THE PERPETUAL RIGHT OF DRILLING, MINING, EXPLORING FOR AND STORING IN AND REMOVING THE SAME FROM THE LAND OR ANY OTHER LAND, INCLUDING THE RIGHT TO WHIPSTOCK OR DIRECTIONALLY DRILL AND MINE FROM LANDS OTHER THAN THE LAND, OIL OR GAS WELLS, TUNNELS AND SHAFTS INTO, THROUGH OR ACROSS THE SUBSURFACE OF THE LAND AND TO BOTTOM SUCH WHIPSTOCKED OR DIRECTIONALLY DRILLED WELLSTUNNELS 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 LAND IN THEEXERCISE OF SUCH RIGHTS OR OTHERWISE ADVERSELY AFFECT THE USE OR OPERATION OF THE LAND OR THE STRUCTURAL INTEGRITY OF ANY IMPROVEMENTS ON THE LAND. ALSO EXCEPTING THEREFROM ANY AND ALL WATER, WATER RIGHTS OR INTERESTS THEREIN APPURTENANT OR RELATING TO THE LAND OR OWNED OR USED BY THE GRANTOR IN CONNECTION WITH OR WITH RESPECT TO THE LAND NO MATTER HOW ACQUIRED BY THE GRANTOR, 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 LAND, TO STORE THE SAME BENEATH THE SURFACE OF THE LAND AND TO DIVERT OR OTHERWISE UTILIZE SUCH WATER, RIGHTS OR INTERESTS ON ANY OTHER PROPERTY OWNED OR LEASED BY GRANTOR; BUT WITHOUT, HOWEVER, THE RIGHT TO ENTER UPON OR USE THE SURFACE OF THE LAND IN THE EXERCISE OF SUCH RIGHTS OR OTHERWISE ADVERSELY AFFECT THE USE OR OPERATION OF THE LAND OR THE STRUCTURAL INTEGRITY OF ANY IMPROVEMENTS ON THE LAND. Exhibit "C" SMRH:481911721.23Master Declaration for Tustin Legacy Cornerstone I 06141725WR-246894 EXHIBIT "D" Articlesof Incorporation MASTER MAINTENANCE ASSOCIATION FOR TUSTIN LEGACY CORNERSTONEI I The name of this corporation is Master Maintenance Association for Tustin Legacy CornerstoneI MasterAssociation (hereinafter referred to as the ""). II A.This corporation is a nonprofit mutual benefit corporation organized under the Nonprofit Mutual Benefit Corporation Law. The purpose of this corporation is to engage in any lawful act or activity, other than credit union business, for which a corporation may be organized under such law. B.This corporation does not contemplate pecuniary gain or profit to the members thereof. This corporation is an association formed to manage a commercial and industrial common interest development, under the Commercial and Industrial Common Interest Development Act (California Civil Code Section6500, et seq.), and the specific primary purposes for which it is formed are to provide for management, administration, and maintenance of areas located within certain property situated in the City of Tustin, County of Orange, State of California, consisting of the Phase1 Parcel and Phase2 Parcel Project as described in the Master Declaration (as defined below), (the ""). The purposes and powers of the Master Association are set forth in and subject to the provisions of the recorded or tobe recorded Declaration Establishing Maintenance and Cost Sharing Obligations for Tustin Legacy CornerstoneI (the MasterDeclarationMaster AssociationBylaws ""), and the Bylaws of the Master Association (the ""). Capitalized terms used, but not defined,in these Master Association Articlesshall have the meanings ascribed thereto in the Master Declaration. III The initial business and mailing address of the Master Association is: Master Maintenance Association for Tustin Legacy Cornerstone I [[599,2044,862,2092][10][B,I,][Arial]][Insert addr [[829,2044,1395,2092][10][B,I,][Arial]]ess of Incorporating Party] The nearest front and side streets of the Project are Barranca Parkway, Armstrong Avenue and Flight Way. IV These Master Association Articlesmay be amended only by the approval of both Members of the Master Association, subject to compliance with California Corporations Code Sections7810, et seq. The vote on a proposed amendment to these Master Association Articlesshall be held pursuant to the terms of the Master Association Bylaws. V The authorized number of members, qualifications of members, classes of membership, along with the voting and other rights and privileges of members shall be as set forth in the Master Declaration and the Master Association Bylaws. Exhibit "D" SMRH:481911721.23Master Declaration for Tustin Legacy Cornerstone I 061417125WR-246894 VI The name and address of the Master Association's initial agent for service of process is: Master Maintenance Association for Tustin Legacy Cornerstone I [[599,544,1223,592][10][B,I,][Arial]][Incorporating Party to insert] The Master Association has no managing agent as of the date of filing of the Master Association Articlesof Incorporation. IN WITNESS WHEREOF, for the purposes of forming this corporation under the laws of the State of California, the undersigned has executed these Articlesof Incorporation this __ day of ________, 20___. _________________________, Incorporator Exhibit "D" SMRH:481911721.23Master Declaration for Tustin Legacy Cornerstone I 061417225WR-246894 EXHIBIT "E" Bylaws Bylaws to be approved by City Manager or designee prior and as a condition to Phase1Property Close of Escrow under the DDA. Exhibit "E" SMRH:481911721.23Master Declaration for Tustin Legacy Cornerstone I 06141725WR-246894 Attachment 22 Form of Pad Transferee Non-Disturbance and Attornment Agreement ATTACHMENT22 FORM OF RECOGNITION, NON-DISTURBANCE AND ATTORNMENT AGREEMENTFOR PAD TRANSFEREES CITYOFTUSTIN OFFICIALBUSINESS REQUEST DOCUMENT TO BE RECORDED AND TO BE EXEMPT FROM RECORDING FEES PER GOVERNMENTCODE 6103 AND27383. RECORDING REQUESTED BY AND WHEN RECORDED MAIL TO: City of Tustin 300 Centennial Way Tustin, CA 92780 Attention: City Manager SpaceAboveThisLineReservedforRecorder’sUse RECOGNITION, NON-DISTURBANCE AND ATTORNMENT AGREEMENT (Pad Transferee) THIS RECOGNITION, NON-DISTURBANCE AND ATTORNMENT AGREEMENT Agreement (Pad Transferee) (this “”) is entered into this________ day of___________, _____, Effective Date (“”) by and among____________________________________, a Pad Transferee ___________________(“”),_____________________, a _______________,the Developer Developer under the DDA (defined below)(“”), and the City of Tustin, California,a municipal corporation duly organized and existing under and by virtue of the laws of the State of City California (the “”).Each of Pad Transferee,Developer, and the Cityare referred to as a PartyParties “” and all of them are sometimes referred to as the “.” WITNESSETH: Flight A.The City and Flight Venture LLC, a Delaware limited liability company (“ Venture ”), the predecessor in interest to Developer, entered into that certain Tustin Legacy Disposition and Development AgreementCornerstone I, dated as ofNovember 15, 2016, as amended by that certain First Amendment to Tustin Legacy Disposition and Development Agreement Cornerstone I dated as of June 20, 2017(including all attachments thereto) DDA (collectively, and as the same may be further amended from time to time, the “”),with respect Development Parcels to the real property described thereinas the “”. The Development Parcels include certain land described in the DDA as the [[1290,2785,2054,2842][12][,I,][Times New Roman]][Phase 1 Property/Phase 2 Property [[2021,2785,2075,2842][12][,I,][Times New Roman]]] [[2060,2785,2300,2842][12][,,][Times New Roman]]as legally described onExhibit Aattached hereto and incorporated herein by this reference, which pursuant to the DDA, were previously conveyed by the City to Developer. Tustin Cornerstone I DDA Att 22 Pad Transferee Cityof Tustin/Lincoln Cornerstone I ATTACHMENT 22 NDA 6-13-2017 (agd) .docx -1- B.A Memorandum of Tustin Legacy Dispositionand Development Agreement Memorandum Cornerstone I (the “”)executed by the Cityand Flight Venture has been recorded against the Development Parcels on ____________, 20__ as Instrument No.______________in Official Records the official records of Orange County, California (the “”).Initially capitalized terms setforth in this Agreement and not defined herein shall have the meanings set forth therefor in the DDA. C.Pursuant to the DDA, the following documents have been executed and recorded in the Official Records against [[955,752,1005,809][12][,I,][Times New Roman]][ [[974,752,1085,809][12][,I,][Times New Roman]]the [[1052,752,1520,809][12][,I,][Times New Roman]]Development Parcels [[1487,752,1874,809][12][,I,][Times New Roman]]/Phase 1/Phase 2 [[1849,752,1953,809][12][,I,][Times New Roman]]: s [[1923,752,2300,809][12][,I,][Times New Roman]]elect documents [[300,810,1491,867][12][,I,][Times New Roman]]below as applicable to the Building Pad to be Transferred [[1460,810,1514,867][12][,I,][Times New Roman]]] [[1486,810,1536,867][12][,,][Times New Roman]]: (i)Quitclaim Deed For Tustin Legacy Cornerstone I –Phase [[[2057,917,2146,974][12][,I,][Times New Roman]]1/2 [[2121,917,2171,974][12][,,][Times New Roman]]] [[2164,917,2300,974][12][,,][Times New Roman]]And Covenants, Conditions And Restrictions, Including Environmental Restriction Pursuant To Civil Code Section 1471 made by City in favor of [[1432,1032,2035,1089][12][,I,][Times New Roman]][Developer/Flight Venture] [[1994,1032,2300,1089][12][,,][Times New Roman]]and accepted and acknowledged by Developer dated as of _______________, 20__ and recorded as Quitclaim Deed Instrument No. ______________ in the Official Records(the “”), (ii)Declaration of Special Restrictionsfor Cornerstone I for [[[1891,1255,2259,1312][12][,I,][Times New Roman]]Phase 1/ Phase 2 [[2233,1255,2283,1312][12][,,][Times New Roman]]] executed by City and accepted and acknowledged by [Developer/Flight Venture], dated as of_______________,20__and recorded as Instrument No. ______________ in the Special Restrictions Official Records (the “”), (iii)Roadway, Landscapeand Utility Easement Agreement entered into by City and[[[558,1592,799,1649][12][,I,][Times New Roman]]Developer [[766,1592,1111,1649][12][,I,][Times New Roman]]/Flight Venture [[1083,1592,1133,1649][12][,,][Times New Roman]]] [[1100,1592,1150,1649][1 2][,,][Times New Roman]], [[1134,1592,1267,1649][12][,,][Times New Roman]]dated [[1263,1592,2300,1649][12][,,][Times New Roman]]as of _______________, 20__ and recorded as Easement Agreement Instrument No. ______________ in the Official Records(“”), (iv)Landscape Installation and Maintenance Agreemententered into by City and[[[558,1815,1112,1872][12][,I,][Times New Roman]]Developer/Flight Venture [[1083,1815,1133,1872][12][,,][Times New Roman]]] [[1100,1815,1150,1872][12][,,][Times New Roman]], [[1134,1815,2300,1872] [12][,,][Times New Roman]]dated as of _______________, 20__ and recorded as Landscape Agreement Instrument No. ______________ in the Official Records(the “”), (v)Master Declaration Establishing Maintenance and Cost Sharing Obligations for Tustin Legacy Cornerstone I dated as of _______________, 20__ and recorded as Master Declaration Instrument No. ______________in the Official Records (the “”). (vi)Declaration of Covenants, Conditions and Restrictionsand Establishment of Easements for The Flight at Tustin Legacymade by[[[1581,2260,2127,2317][12][,I,][Times New Roman]]Developer/Flight Venture [[2099,2260,2149,2317][12][,,][Times New Roman]]] [[2116,2260,2166,2317][ 12][,,][Times New Roman]], [[2142,2260,2300,2317][12][,,][Times New Roman]]dated as of _______________, 20__ and recorded as Instrument No. ______________ in the CC&Rs Official Records(the “”), [[769,2481,1088,2538][12][B,I,][Times New Roman]]{if applicable: [[1048,2481,1105,2538][12][B,I,][Times New Roman]]} (vii)[[750,2482,800,2539][12][,I,][Times New Roman]][ [[1092,2482,1926,2539][12][,I,][Times New Roman]]Special Land Use Restrictions, made by [[1887,2482,1937,2539][12][,I,][Times New Roman]][ [[1904,2482,2300,2539][12][,I,][Times New Roman]]Developer/Flight [[450,2540,636,2597][12][,I,][Times New Roman]]Venture [[603,2540,657,2597][12][,I,][Times New Roman]]] [[628,2540,810,2597][12][,I,][Times New Roman]], dated [[819,2540,2300,2597][12][,I,][Times New Roman]]as of _______________, 20__ and recorded as Instrument No. [[1396,2596,1541,2653][12][B,I,][Times New Roman]]SLUR [[449,2597,825,2654][12][,I,][Times New Roman]]______________ [[812,2597,1316,2654][12][,I,][Times New Roman]]in the Official Records [[1279,2597,1418,2654][12][,I,][Times New Roman]](the “ [[1525,2597,1603,2654][12][,I,][Times New Roman]]”) [[1569,2597,1619,2654][12][,I,][Times New Roman]], [[1576,2597,1630,2654][12][,I,][Times New Roman]]] [[1614,2597,1711,2654][12][,,][Times New Roman]]and The foregoing collectively,together with the DDA and Memorandum ofDDA,are referred to Property Documents[[1076,2761,2046,2818][12][B,I,][Times New Roman]][add License Agreements above if applicable] herein as the “”. D.Developer intends to [[1060,2870,1110,2927][12][,I,][Times New Roman]][ [[1080,2870,1200,2927][12][,I,][Times New Roman]]sell/ [[1161,2870,1358,2927][12][,I,][Times New Roman]]ground [[1331,2870,1462,2927][12][,I,][Times New Roman]]lease [[1428,2870,1482,2927][12][,I,][Times New Roman]]] [[1476,2870,2299,2927][12][,,][Times New Roman]]to Pad Transferee the portion of the Tustin Cornerstone I DDA Att 22 Pad Transferee ATTACHMENT 22Cityof Tustin/Lincoln Cornerstone I NDA 6-13-2017 (agd) .docx-2- [[300,300,529,357][12][,I,][Times New Roman]][Phase 1 [[490,300,661,357][12][,I,][Times New Roman]]Parcel [[623,300,862,357][12][,I,][Times New Roman]]/Phase 2 P [[842,300,981,357][12][,I,][Times New Roman]]arcel [[939,300,993,357][12][,I,][Times New Roman]]] [[977,300,1162,357][12][,,][Times New Roman]]legally [[1124,300,1429,357][12][,,][Times New Roman]]described on [[1392,300,1589,357] [12][,,][Times New Roman]]Exhibit [[1551,300,1601,357][12][,,][Times New Roman]]B [[1597,300,1925,357][12][,,][Times New Roman]]attached hereto [[1913,300,2300,357][12][,,][Times New Roman]]and incorporated Building Pad herein by this reference(the “”)pursuant to that certain {[[1701,357,2250,414][12][,I,][Times New Roman]]specify written agreement [[2213,357,2287,414][12][,,][Times New Roman]]}, Conveyance AgreementGround Lease dated as of ____________ (the “”/“”). Under the terms and provisions of the DDA, Pad Transferee,(i) is an End User,and (ii)does not intend to engage in a Prohibited Use upon theBuilding Pad. Pad Transfereeproposes to construct and thereafter Pad TransfereeVertical operate an office building of ___________GBA on the Building Pad(“ Improvements ”) in accordance with MCAS Tustin Specific Plan/Reuse Plan, as amended Specific Plan[[684,701,891,758][12][B,I,][Times New Roman]][specify [[859,701,1117,758][12][B,I,][Times New Roman]]applicable [[1085,701,1363,758][12][B,I,][Times New Roman]]entitlements [[1328,701,1383,758][12][B,I,][Times New Roman]]] (“”),and in compliance with all applicable laws, rules, regulations, ordinances and the Property Documents, including without limitation, parking requirements set forth in the Tustin City Code and the Specific Plan. E.Pursuant to the DDA, Developer agreed to complete or cause to be completed construction of certain improvements on the [[1209,982,1259,1039][12][,I,][Times New Roman]][ [[1226,982,1978,1039][12][,I,][Times New Roman]]Phase 1 Property/Phase 2 Property [[1946,982,2000,1039][1 2][,I,][Times New Roman]]] [[1971,982,2021,1039][12][,,][Times New Roman]], [[1998,982,2301,1039][12][,,][Times New Roman]]including on the Building Pad, within the time periods and subject to the additional terms and conditions set forth in the DDA. F.Under the terms of the DDA, Pad Transferee is obligated to comply with certain of the requirementsof the DDA, theQuitclaim Deed, the Special Restrictions,the Easement Agreement, theLandscape Agreement,the CC&Rs, and the Master Declaration,which apply to the Building Pad and/or the Pad Transferee including without limitation the following: (i) the obligations of Developer under the DDA relating to the Building Pad; (ii) the obligation to construct the Pad Transferee Vertical Improvements and the Horizontal Improvements required to Pad be constructed on the Building Pad in connection therewith (collectively, the “ Improvements ”) within the time period set forth for the Completion ofsuch Pad Improvements by Developer in the Schedule of Performance,and (iii) the City’s Right of Repurchase and the City’s Right of Reversion. G.Section 2.2.3(c)(i)of the DDA provides the City with theright among other things: (i)to obtain the identity of theproposed Pad Transfereein order to confirm that the Pad Transferee is an End User and will not engage in a Prohibited Use; (ii) the terms of the Ground Lease or Conveyance Agreementand all other Transfer Agreements (as defined below) proposed to be executed by Developer and Pad Transferee, to confirm that they comply and do not conflict with the terms and requirements of the Property Documents;(iii) the building type, size and use of the Pad Improvementsto confirm that they comply with the Property Documents,and (iv) if, underthe Transfer Agreements (as defined below)or the Property Documents,the Pad Transferee is responsible for construction of any Improvements on the Building Pad, Developer shall provide to the City the financial documentation requested by the City in order to assure the City, in its sole discretion, of the financial capacityof the PadTransferee to finance and construct such Improvements, including current audited financial statements of the proposed Pad Transferee or financial statements certified by the chief financial officer or other appropriate authorized officer of theproposed Pad Transferee if the proposed Pad Transferee does not have audited financial statements or a net worth letter from the certified public accountant from the proposed Pad Transferee and such other relevant information as the City may reasonably request to the extent necessary to evidence that the proposed Pad Transferee intends to operate a business that is not a Prohibited Use, and to perform those obligations of Developer under this Agreement assigned to the Pad Transferee with respect to the Building Pad. Tustin Cornerstone I DDA Att 22 Pad Transferee ATTACHMENT 22Cityof Tustin/Lincoln Cornerstone I NDA 6-13-2017 (agd) .docx-3- H.As required by the DDA, Developer and Pad Transferee have requested that the City provide its consent to each of the foregoingand evidence that consent by executing the attached City consent. I.As a condition to consent by the City to the foregoing,Developer and Pad Transferee have agreed to comply with the terms of this Agreement and have provided the City with copies of all other agreements between Developer and Pad Transferee related to the Transfer, including [[[2172,637,2301,694][12][,I,][Times New Roman]]{for [[300,695,431,752][12][,I,][Times New Roman]]sale} [[418,695,690,752][12][,I,][Times New Roman]]Conveyance [[677,695,933,752][12][,I,][Times New Roman]]Agreement [[895,695,1371,752][12][,I,][Times New Roman]]/ {for lease} Ground [[1336,695,1483,752][12][,I,][Times New Roman]]Lease [[1455,695,1505,752][12][,,][Times New Roman]]] [[1472,695,1522,752][12][,I,][Times New Roman]], [[1502,695,1613,752][12][,,][Times New Roman]]the [[1580,695,2111,752][12][,,][Times New Roman]]Master Declaration, the [[2079,695,2268,752][12][,,][Times New Roman]]CC&Rs [[2238,695,2288,752][12] [,,][Times New Roman]], including any amendments thereto,[[1028,752,1078,809][12][,I,][Times New Roman]][ [[1047,752,1372,809][12][,I,][Times New Roman]]{if applicable} [[1342,752,1558,809][12][,I,][Times New Roman]]the SLUR [[1538,752,1588,809][12][,I,][Times New Roman]], [[1546,752,1600,809][12][,I,][Times New Roman]]] [[1587,752,1709,809][12][,,][Times New Roman]]and [[1674,752,2223,809][12][,,][Time s New Roman]]all agreements related to [[2189,752,2301,809][12][,,][Times New Roman]]the development, design, construction, operation and maintenance of the Minimum Horizontal Improvements and the Pad Improvements(together with the [[1580,867,1630,924][12][,I,][Times New Roman]][ [[1599,867,2300,924][12][,I,][Times New Roman]]Conveyance Agreement/Ground Transfer Agreements [[298,925,445,982][12][,I,][Times New Roman]]Lease [[412,925,466,982][12][,I,][Times New Roman]]] [[437,925,487,982][12][,,][Times New Roman]], [[465,925,990,982][12][,,][Times New Roman]]but excluding any profit [[954,925,1004,982][12][,,][Times New Roman]]- [[970,925,1587,982][12][,,][Times New Roman]]sharing or similar agreement [[1551,925,1601,982][12][,,][Times New Roman]]s [[1571,925,1621,982][12][,,][Times New Roman]], [[1599,925,1710,982][12][,,][Times New Roman]]the [[1676,925,1726,982][12][,,][Times New Roman]]“ [[2157,925,2246,982][12][,,][Times New Roman]]”) [[2211,925,2300,982][12][,,][Times New Roman]]in the form and substance of the documents they intend to executeto consummatethe Transfer,which Acceptable Agreements documents havebeen reviewedand accepted by the City(“”). J.The Partiesdesire to enter into this Agreement in order to (i) provide certain rights and remedies in favor of the City with respect to failure of Pad Transfereeto comply with the requirements of the DDA,(ii) establish certain rights and remedies of City and Pad Transferee with respect to each otherduring the period of ownership of the Building Pad by Pad Transferee Ownership Period and/or any Applicable Owner Successor (as defined below) (the “”) all on the terms and conditions specified in this Agreement,and (iii) establish certain revised (a) Schedule of Performance dates pertaining to the commencement of construction and Completion ofthe Pad Improvementscarried out by Pad Transferee (and not Developer),and (b)Reversion Action Triggers and Reversion Action Trigger Datespertaining to the commencement of construction and Completion of the Pad Improvements carried out by Pad Transferee (and not Developer), allon the terms and conditions specified in this Agreement. AGREEMENT NOW, THEREFORE, in consideration of their mutual covenants contained herein and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Partieshereby agree as follows: 1.Non-Disturbance and Attornment.Subject to the provisions of Section 3of this Agreement [[914,2184,1251,2241][12][B,I,][Times New Roman]]{if applicable:} and the Property Documents, [[894,2185,944,2242][12][,I,][Times New Roman]][ [[1231,2185,1812,2242][12][,I,][Times New Roman]]including, but not limited to [[1787,2185,1837,2242][12][,I,][Times New Roman]], [[1812,2185,1923,2242][12][,I,][Times New Roman]]the [[1884,2185,2023,2242][12][,I,][Times New Roman]]SLUR [[2004,2185,2054,2242][12][,I,][Times New Roman]], [[2011,2185,2065,2242][12] [,I,][Times New Roman]]] [[2049,2185,2099,2242][12][,,][Times New Roman]]i [[2063,2185,2301,2242][12][,,][Times New Roman]]f the City succeeds to the Developer’s interest as [[1088,2243,1945,2300][12][,I,][Times New Roman]][seller under the Conveyance Agreement [[1919,2243,2300,2300][12][,I,][Times New Roman]]/ landlord under [[300,2300,411,2357][12][,I,][Times New Roman]]the [[374,2300,687,2357][12][,I,][Times New Roman]]Ground Lease [[654,2300,708,2357][12][,I,][Times New Roman]]] [[692,2300,1365,2357][12][,,][Times New Roman]]following the Pad Transfer Date [[1338,2300,1388,2357][12][,,][Times New Roman]], [[1363,2300,1934,2357][12][,,][Times New Roman]]then as further set forth in [[1898,2300,2301,2357][12][ ,,][Times New Roman]]and subject to the terms of this Agreement, including without limitation, the provisions of Sections3.1through 3.4 of this Agreement and Sections5.2and5.3of this Agreement, during the Ownership Period, the City shall not terminate or disturb Pad Transferee’s occupancy or possession of the Building Pad and Pad Transferee shall attorn to City and recognize City as [[1631,2530,1792,2587][12][,I,][Times New Roman]][seller [[1784,2530,2300,2587][12][,I,][Times New Roman]]under the Conveyance [[297,2587,552,2644][12][,I,][Times New Roman]]Agreement [[527,2587,579,2644][12][,I,][Times New Roman]]/ [[555,2587,980,2644][12][,I,][Times New Roman]]landlord under the [[943,2587,1256,2644][12][ ,I,][Times New Roman]]Ground Lease [[1222,2587,1276,2644][12][,I,][Times New Roman]]] [[1247,2587,1297,2644][12][,,][Times New Roman]]. Tustin Cornerstone I DDA Att 22 Pad Transferee ATTACHMENT 22Cityof Tustin/Lincoln Cornerstone I NDA 6-13-2017 (agd) .docx-4- 2.Completion Date Modification.Notwithstanding any provision of the DDA, including without limitation, the Schedule of Performance,the following shall comprise the required Schedule of Performance datesapplicable to construction and Completion of the Pad Improvementsto be constructedby Pad Transferee on theBuilding Pad; provided thatthe following dates shall apply solely with respect to the Pad Transferee’s construction of Pad Improvements onthe Building Pad(and for avoidance of doubt, the dates applicable to Developer’s construction of Improvements on the DevelopmentParcels, including the Building Pad, shall be subject to the dates set forth in the Schedule of Performance attached to the DDA unless otherwise modified as described in Section4.3below): 2.1.The Pad Improvementsshall be commenced on or before the date that is six (6) monthsfrom the Pad TransferDate, subject to Force Majeure Delay (but with any extension for Force Majeure Delay in no event toexceed one (1) year, even if the item or items of Force Majeure Pad Construction CommencementTrigger Date Delay exist for a longer period)(“”); and 2.2.The Pad Improvements shall be Completed on or before the date that the earlier of the following:(a)eighteenmonths (18)months following the Pad Construction Commencement Trigger Dateor (b)twenty-four(24) monthsfrom the Pad Transfer Date, in each case subject to Force Majeure Delay (but with any extension for Force Majeure Delay in no event to exceed one (1) year, even if the item or items of Force Majeure Delay exist for a longer period)(such earlier Pad Completion Trigger Date date, the “”). 3.The City’sRights. 3.1.Right of Repurchase.If Developer and/or Pad Transfereeshall be in default under this Agreement, or in Material Default under any of the Property Documents,the City shall have available to it all remedies set forth in this Agreementand the Property Documents, as the case may be. Notwithstanding the foregoing sentence, from and after the Pad Transfer Date, but with Pad Transferee respect to the Pad Transferee and Pad Transferee’s interest in the Building Pad(“ Interests ”) only,theCity’s Right of Repurchase with respect to the Pad Transferee Interestsshall continue in full force and effect,provided that: (a)the Cityshall have no right toexercise the Right of Repurchase with respect to the Pad Transferee Interests prior to the earlier of:(i) the occurrence of a default by Pad Transferee under this Agreementpast all applicable notice and cure periods, (ii)the occurrence of aMaterial Default by PadTransferee under the Property Documents or (iii)if construction of the PadImprovements on the Building Pad has not commenced on or before such date, the Pad Construction Commencement Trigger Date; (b)if construction of the PadImprovementshas commenced by the Pad Construction Commencement Trigger Date, the City shall have no right to exercise its Right of Repurchase with respect to the Pad Transferee Interests until the earlier of:(i) the occurrence of a default by Pad Transferee under this Agreementpast all applicable notice and cure periods, (ii)the occurrence of a Material Default by Pad Transferee under the Property Documents or (iii)the failure to Complete the construction of the Pad Improvements by the PadCompletion Trigger Date; Tustin Cornerstone I DDA Att 22 Pad Transferee ATTACHMENT 22Cityof Tustin/Lincoln Cornerstone I NDA 6-13-2017 (agd) .docx-5- (c)the Repurchase Price(as such term is used in the DDA) shall be modified with respect to exercise of the Right of Repurchase of the Pad Transferee Interestsand shall be equal to,(i)the Pad Transferee’sBook Value for its interest in the Building Padand the Pad Improvements constructed by Pad Transferee thereon;it being agreed that “Book Value”shall mean the book value of the Building Pad on the records of the Pad Transfereeowningsuch Building Pad on the date of calculation thereof, and shall be comprised of: (A)the applicable land account for the property which encompasses, among other items, purchase price, if applicable, and soft costs, and (B)the applicable building account which encompasses, among other things, hard initial construction and renovation costs and soft costs,lessaccumulated depreciation on the building and applicable secured equipment,less,(ii) Lien Release Amounts applicable to the Building Pad and/or the Building Pad Interests,and (d)if thePad Improvements on the Building Padare Completed on or before the PadCompletion Trigger Datethen the City shall have no further right to exercise the Right of Repurchase with respect to the Building Pad. 3.2.Right of Reversion.If the Right of Reversion remains effective under the DDA as of the Effective Date of this Agreement, thenCity’s Right of Reversion shall continue in full force and effectwith respectto the Building Padduring the term of this Agreementuntil issuance of a Certificate of Compliance for the Building Pad notwithstanding any earlier termination ofthe Right of Reversion under the DDA in favor of Developer;provided thatas to the Pad Transferee Interests only, the Reversion Action Triggers set forth in Section 16.4.1of the DDAshall be replaced with the following, which shall be effective solely as to the Pad Transferee Interests: (a)Construction of the Pad Improvements has not commenced on or before the date that is six (6) monthsfollowing the Pad Construction Commencement Trigger Date;as such date may be extended for Force Majeure Delay; provided that such commencementdate shall not under any circumstances be later than the date that is one (1)year following the Pad Construction CommencementTriggerDate (which date shall not be extended for Force Majeure Delay); (b)Construction of the Pad Improvements has not been Completed on or before the date that is thirty (30) months followingthe Pad Construction CommencementTriggerDate, as such date may be extended for Force Majeure Delay; provided that such Completion date shall not under any circumstances be later than the date that is three (3) years after the Pad Construction CommencementTriggerDate (which date shall not be extended for Force Majeure Delay); (c)Pad Transferee commits physical waste on the Transfer Pad and such becomes a Material Default in accordance with the notice and cure provisions of Section 14.2of the DDA, subject to extension for Force Majeure Delay; (d)Pad Transfereeabandons or substantially suspends (except for suspensions resulting from Force Majeure Delay) construction of the PadImprovementsfor a total period of one (1) year, and such becomes a Material Default in accordance with the notice and cure provisions ofSection14.2of the DDA; (e)The occurrence of an Insolvency Event with respect to Pad Transferee;or Tustin Cornerstone I DDA Att 22 Pad Transferee ATTACHMENT 22Cityof Tustin/Lincoln Cornerstone I NDA 6-13-2017 (agd) .docx-6- (f)A Material Default arises because of a voluntary or involuntary Transfer or Transfer of Control of Pad Transferee. If the Pad Improvements on the BuildingPad are Completed by the dateset forth in Section3.2(b) of this Agreement,then upon such Completion, theCity shall have no further right to exercise the Right of Reversion. 3.3.Limitation on Force Majeure Delay. Notwithstanding any other provision of this Agreement or the Property Documents to the contrary, the dates set forth in Section 3.1of this Agreement with respect to the Right of Repurchase and the Reversion Action Trigger Datesset forth in Section3.2of this Agreement shall be extended for Force Majeure Delays only to the extent specifically set forth in such Sections. 3.4.Additional Rights of City.Nothing in this Agreement shall impair or modify: (a)the City’srights and remedies under the Property Documents with respect to the Right of Repurchase or Right of Reversion, except to the extent specifically set forth in Section 3.1, 3.2and 3.3of this Agreement with respect to the Pad Transferee Interests and/or,(b) all other City rights and remedies contained in the Property Documents. Without limiting the foregoing, Pad Transferee acknowledges that the DDA contains provisions that may, among other things, result in the City exercisingthe Right of Reversion or Right of Repurchase as to other portions of the Development Parcels,or exercising its other remedies set forth in the PropertyDocuments,and suchexercise(x)shall not obligate City to assume any obligations under the Property Documents with respect to the acquired Property, including without limitation, the obligation toconstruct any or all Improvements upon the Development Parcels, including without limitation, Horizontal Improvements required for development of the Pad Improvements,and (y)may result in, among other things,all or any portion of the Development Parcels being developed by a Person other than Developer and being developed for currently unforeseen uses. 3.5.Exercise of Remedies Voluntary.Nothing in this Agreement shall obligate the City to exercise the Right of Repurchase or Right of Reversion or to exercise any other remedy against Developer, Pad Transferee, the Development Parcels or the Pad Transferee Interests and the exercise of such remedies by the City shall be a right and not an obligation of the City. 4.On-Going Obligations of Developerand Pad Transferee. 4.1.Generally.Notwithstanding anything to the contrary contained in this Agreement, or in the Transfer Agreements:(a) Developer, its successors and assigns,each Pad Transferee, any successor or assignee of the Pad Transferee and the Building Padare and shall remain subject to this Agreement, the DDA (except as expressly modified herein as to the Pad Transfereeand the successors and assigns of Pad Transfereeduring the period of ownership by any End User)and the remaining Property Documentsand to all rights and remedies of the City under the Property Documents, including without limitation, the Right of Repurchase and the Right of Reversion except and unless specifically modified by this Agreement,and (b) Developer hereby acknowledges and agrees that it retainsand is not released or relieved from performance of allthe obligationsundertheProperty Documentsrelatingto theBuilding Pad, including, but not limited to, construction oftheImprovementsand performanceofDeveloper’s maintenanceand indemnity obligations with respect to the Development Parcels, including theBuilding Pad,payment of all Tustin Cornerstone I DDA Att 22 Pad Transferee ATTACHMENT 22Cityof Tustin/Lincoln Cornerstone I NDA 6-13-2017 (agd) .docx-7- Development Costs and all Ongoing Matters and those additional matters described in Sections 2.2.3(c)(v) through (viii)of theDDA, inclusive. 4.2.Obligations of Pad Transferee.Notwithstandinganythingtothecontrarycontained inthisAgreement or any of the Documents, Pad Transfereeon behalf of itself and each Pad TransfereeSuccessorhereby represents, warrants, acknowledges and agrees for the benefit of the City that: (a)Pursuant to the Assignment and Assumption Agreement, Pad Transferee has, on behalf of itself and each Successor Pad Transferee,among other things, assumed the following obligations of Developerwith respect tothe Building Pad and the Pad Improvements: (i)the obligation to perform in accordance with or otherwise comply with the requirements of the Property Documents with respect to the Building Pad from and after the date of conveyance of the Building Pad to Pad Transferee; (ii)the restrictions on Mortgagescontained in the DDA; (iii)the Transfer and Transfer of Control restrictions set forth in Sections 2.1through2.4of the DDA, inclusive; (iv)Sections 4.5.1and 4.5.2of the DDA (inclusive) including, without limitation, the release set forth in Section 4.5.2(f)of the DDA; (v)the indemnities and other requirements ofSections5.5, 8.8, 8.9, 8.11, 8.12, 10.1, 10.2and 18.11.1of the DDA,and (vi)the covenants and use restrictions set forth in Section 12.1, 12.2and Sections 12.5through 12.7of the DDA, inclusive. (b)Pad Transferee andeach successor and assign of Pad Transferee with respect to the Building Pad are and shall remain subject to this Agreement,theDDA(exceptasexpressly modifiedhereinastothePad Transferee and Applicable Owner Successors) and the Property Documents and to all rights and remedies of the City under the DDA and the Property Documents, Applicable including without limitation, the Right of Repurchase and the Right of Reversion.An “ Owner Successor ” is anyOwner Successor except any of the following: (i)Developer or any successor or assign to a Developer (as defined in the DDA) taking title to the Building Pad or any portion thereof as a result of reacquisition of all or any portion of the Property subsequent to the original conveyance to Pad Transferee,or(ii)a Developer Affiliate. 4.3.The Parties specifically acknowledge the provisions of Section 2.2.3(c)(vi) and(vii)of the DDAwhich providethat the Developer will use its commercially reasonable efforts to record a declaration of special land use restrictioncomparable to that recorded by the master developer of the Campus at Playa Vista development(“SLUR”) and/or to incorporate the terms thereof in the other Transfer Agreements,and enforce the same to the extent Developer has the right to do so pursuant to the SLUR and/or other Transfer Agreements. The City shall have the express right(but not the obligation)to seek specific performance (a)against Developerto require Tustin Cornerstone I DDA Att 22 Pad Transferee ATTACHMENT 22Cityof Tustin/Lincoln Cornerstone I NDA 6-13-2017 (agd) .docx-8- Developer to exercise its rights and remedies under the Transfer Agreements,with respect to the Pad Transferee or its successor in interest(but in thecircumstance where Developer is exercising the foregoing rights, the City and Developer shall endeavor to agree in good faith on a revised Schedule of Performance with respect to Developer’sobligation to Complete the Vertical Improvements (including the core and shell, exterior staircases and balcony systems and common restrooms, but excluding the requirement to construct any other tenant improvements) on such Building Pad in order to permitDeveloper to seek an appropriate Pad Transferee approved by the City for such Building Pad)giving due regard to the circumstances in existence at such time,and (b)against the Pad Transferee or its successor in interest including, withoutlimitation, the City’s Right of Repurchase or Right of Reversion contained in the DDA as modified by this Agreement with respect to the Building Pad. 5.City as Successor to Developer.If the City succeeds to the interest of Developer under the Transfer Agreementsor any thereof, whether through or in lieu of the exercise by the City of any of its rights and/or remedies pursuant to this Agreement, the Transfer Agreementsor the Property Remedies Documentsor otherwise (the “”), then in such event(and only in such event): 5.1.The City, in its capacity as the successor to Developer’s interest under the Property Documents (and if applicable, the Transfer Agreements),and any other successor in interest to City Successor such interests(any of the foregoing, the “”)shall be subject to and shall comply with the terms and provisions of this Section5. 5.2.So long as(a)Pad Transfereeis not in default of its payment or performance obligations underthis Agreement or under the Transfer Agreementsbeyond any applicable grace or cure period set forth herein or therein,and (b)Pad Transfereeis not in Material Default in the performance or observance of any term, covenant or conditionof the Property Documents,City Successorshall not terminate or disturb Pad Transferee’soccupancy or possession of the Building Pad,and the rights of Pad Transfereeunder the Transfer Agreementsshall remainin full force and effect, except as otherwise expresslypermitted in accordance with the terms of this Agreement or theterms of the Transfer Agreements; provided that,(i) Pad Transferee is not in default of its payment or performance obligations under this Agreement or under the Transfer Agreements beyond any applicable grace or cure period set forth herein or therein,and (ii) Pad Transferee is not in Material Default in the performance or observance of any term, covenant or condition of the DDA or in default in the performance or observance of any term, covenant or condition of the other Property Documents. 5.3.Pad Transfereeshall attorn to the City Successorand recognize the City Successor sellerlessor as [“”or“”]under th[[984,2397,1034,2454][12][,I,][Times New Roman]]e [[1025,2397,1227,2454][12][,,][Times New Roman]]Transfer [[1213,2397,1446,2454][12][,,][Times New Roman]]Agreemen [[1421,2397,1471,2454][12][,,][Times New Roman]]t [[1435,2397,1485,2454][12][,I,][Times New Roman]]. [[1483,2397,1818,2454][12][,,][Times New Roman]]Pad Transferee [[1809,2397,2300,2454][12][,,][Tim es New Roman]]shall perform, and be bound under, all of the terms, covenants and conditions of the Transfer Agreements, including, but not limited to, the obligation to pay all amounts owed under the Transfer Agreements,{if Ground Lease: [including without limitation, rent and any percentage rent]},until the expiration or earlier termination of the Transfer Agreements,including any renewal options which are exercised in accordance with the terms of the Transfer Agreements.Pad Transfereeshall execute and deliver to the City Successorsuchfurther assurance and other documents, including a new lease upon the same termsand conditions as the Transfer Agreements, confirming the foregoing, as the City Successormayreasonably request. Notwithstanding the foregoing and except as specifically set forth in Sections 2and 3of this Agreementwith respect to the Pad TransfereeInterests, nothing Tustin Cornerstone I DDA Att 22 Pad Transferee ATTACHMENT 22Cityof Tustin/Lincoln Cornerstone I NDA 6-13-2017 (agd) .docx-9- containedin this Agreementshall be interpreted torelease Developer, the Building Padand/or Pad Transfereefromthe obligations imposed under the Property Documents. 5.3.1.Any interestof the City Successorunder theProperty Documents or the Transfer Agreementsacquiredby the City shall not merge with any other interests ofCity in the Building Pad,includingwithout limitation any right, title or interest of the City under theProperty Documents, the Right of Repurchase and the Right of Reversionand/orother rights or remedies available to the City under any of theProperty Documents. 5.4.The following shall be binding upon Pad Transferee,each Successor Pad Transferee and theBuilding Pad for the benefit ofCity and eachCity Successor: 5.4.1.The City Successorshall not be liable for or bound by any act or omission of Developer or any predecessor in interest to such City Successor. 5.4.2.The City Successorshall notbe liable for payment of any sums due from Developer to PadTransfereeincluding, without limitation, (a)any payment or credit in the nature of a [[406,1247,726,1304][12][,I,][Times New Roman]][construction/ [[690,1247,851,1304][12][,I,][Times New Roman]]tenant [[810,1247,864,1304][12][,I,][Times New Roman]]] [[857,1247,1953,1304][12][,,] [Times New Roman]]improvement allowance or comparable item, any [[1925,1247,2064,1304][12][,,][Times New Roman]]secur [[2030,1247,2300,1304][12][,,][Times New Roman]]ity deposit (unless the City Successorshall have actually received and failed to refund such deposit in accordance with the terms of the Transfer Agreements), (b)payments[[1676,1362,2091,1419][12][,I,][Times New Roman]]{if Ground Lease: [ [[2061,1362,2300,1419][12][,I,][Times New Roman]]including [[299,1420,686,1477][12][,I,][Times New Roman]]without limitation [[661,1420,711,1477][12][,,][Times New Roman]], [[682,1420,908,1477][12][,I,][Times New Roman]]payments [[893,1420,1442,1477][12][,I, ][Times New Roman]]of rent or additional rent [[1401,1420,1477,1477][12][,I,][Times New Roman]]]} [[1462,1420,1685,1477][12][,,][Times New Roman]]made by [[1651,1420,1983,1477][12][,,][Times New Roman]]Pad Transferee [[1971,1420,2300,1477][12][,,][Times New Roman]]for more than (1) month in advance of the due date thereunder to Developer or any predecessor in interestto such a City Successoror (c) payments of any kind owing from Developer to Pad Transfereeunder theTransfer Agreementsor otherwise, including, without limitation, any refunds, payment, reimbursementor damagesowed from Developer toPad Transferee. Without limiting the foregoing, with respect to all such items, Pad Transferee agrees to look solely to Developer and any Guarantor of Developer and not to any City Successor. 5.4.3.Pad Transfereehereby waives and relinquishes with respect to each City Successorall offsets, counterclaims anddefenses which Pad Transfereemay have against Developer or any predecessorin interest thereof (including, without limitation, any offset, abatement or right of deduction provided for under the terms of the Transfer Agreements). 5.4.4.The City Successorshall notbe bound by any agreementbetween Developer and Pad Transfereepurporting to cancel, surrender, amend or modify the Transfer Agreements,unless such change has been approved in writing by the City pursuant to Section6of this Agreement. 5.4.5.The City Successorshall notbe required to rebuild, repair or restore any damage to theBuilding Pad or the Development Parcels, the Horizontal Improvements orany other Improvementsor any portion thereof caused by the occurrence of casualty or following a condemnation of all or any portion of the Development Parcels regardless of whether or notthere are sufficientinsurance orcondemnation proceeds to pay the cost of such rebuilding, repair or restoration. 5.4.6.The City Successorshall notbeliable with respect to any obligation to complete any site work or build out or maintain any improvements for the Building Padincluding, Tustin Cornerstone I DDA Att 22 Pad Transferee ATTACHMENT 22Cityof Tustin/Lincoln Cornerstone I NDA 6-13-2017 (agd) .docx-10- without limitation, any portion of thePad Improvements, the Minimum Horizontal Improvements orany other Horizontal Improvements,the PadTransferee VerticalImprovements or any other Vertical Improvementsor tenant improvements to be built upon theBuilding Pador the Development Parcels, and/or any obligation to pay any [[1528,472,1848,529][12][,I,][Times New Roman]][construction/ [[1812,472,1973,529][12][,I,][Times New Roman]]tenant [[1932,472,1986,529][12][,I,] [Times New Roman]]] [[1984,472,2286,529][12][,,][Times New Roman]]improvement allowance to Pad Transfereepursuant to theTransfer Agreements or otherwise. 5.4.7.Without limiting the applicability of any other provision of this Agreement, to the extent, if any, that the City or City Successor may have otherwise had any liability for any payments required to be made by Developer to Pad Transferee prior to the date that City or City Successor obtains title to the Building Pad, City and City Successor are hereby relieved of any such liability and, notwithstanding any provision in any agreement to the contraryin no event shall City or City Successorbe liablefor any payments required to be made by Developer to Pad Transfereefor any period prior to the date the City Successorobtains title to the Building Pad. 5.4.8.Each City Successorshall be released and relieved of any obligation of Developer accruing after itstransfer, sale, assignment or conveyance to another person or entity of the title to theBuilding Pad. 5.5.Hazardous Materials. 5.5.1.Nothing in this Agreement shall be construed to limit or restrict in any way Developer’s and Pad Transferee’s releases and waivers contained in Section4.5.2(f)of the DDA, which remain in full force and effect, unmodified. 5.5.2.Nothing in this Agreement shall be construed to limit or restrict in any way Developer’s and Pad Transferee’s environmental indemnities contained in Section10.2of the DDA, which remain in full force and effect, unmodified. 6.Additional Pad TransfereeAgreements.Pad Transfereeand Developer, as applicable, make thecovenants and agreements to the City set forth in this Section6,and Developer makes the covenant and agreementset forthin Section6.4below. 6.1.Developer and Pad Transferee have provided the City with true and correct copies of the executed Transfer Agreements which shallbe a full and complete set of all documents relating tothe transaction and which shall be provided to City along with a signed statement certifying to City that the documents provided are a full and complete set of all documents relating to the transactionand,unless modified with the consent of the City, shall be in the form of the Acceptable Agreements delivered to the Cityprior to execution by the City of this Agreement. 6.2.Not less than ten(10) business days prior to execution thereof,Developer and/or Pad Transfereeshall provide the City with copies of each and every proposed amendment, alteration, supplement, modification, termination, and/orwaiver with respect to the Transfer Agreements.Prior to execution thereof by Pad Transferee and/orDeveloper,such parties shall obtain the consent of the Cityto any of the foregoing that would, in the judgment of the City,in its sole discretion,adversely impact the City’s intended benefits or rights under the Property Documents and/or the Transfer Agreements,including as a result of reallocation by and among Developerand/or Pad Transfereeof the rights or obligations of each under the Transfer Agreements Tustin Cornerstone I DDA Att 22 Pad Transferee ATTACHMENT 22Cityof Tustin/Lincoln Cornerstone I NDA 6-13-2017 (agd) .docx-11- or the Property Documents, or any increase in the obligations or decrease in the rights of a Person to whose interest City Successor could succeed under the Property Documents, or otherwise affecting, individually or cumulatively, the rights in favor or obligations of any of such Parties Modifications (individually or collectively) to the City (collectively, “”). Developer and Pad Transferee acknowledge and agree that no Modification shall be effective with respect to or bind the City in any manner unless Developer and Pad Transferee shall, prior to the execution thereof, have obtained the consent of the City thereto as required by this Section. [[773,751,823,808][12][B,I,][Times New Roman]]{ [[790,751,1374,808][12][B,I,][Times New Roman]]if Conveyance Agreement: [[1356,751,1406,808][12][B,,][Times New Roman]]a [[1381,751,2300,808][12][B,I,] [Times New Roman]]dd/modify as to any agreed upon payment 6.3.Except[[753,752,803,809][12][,I,][Times New Roman]][ [[300,809,600,866][12][B,I,][Times New Roman]]to be exclude [[600,809,650,866][12][B,I,][Times New Roman]]{ [[617,809,984,866][12][B,I,][Times New Roman]]if Ground Lease [[970,809,1070,866][12][B,I,] [Times New Roman]]add [[1045,809,1095,866][12][B,I,][Times New Roman]]: [[1054,809,1111,866][12][B,I,][Times New Roman]]} [[570,810,622,867][12][,I,][Times New Roman]]/ [[1084,810,1797,867][12][,I,][Times New Roman]]for the payment of the first month [[1772,810,1822,867][12][,I,][Times New Roman]]’ [[1788,810,1938,867][ 12][,I,][Times New Roman]]s rent [[1897,810,1951,867][12][,I,][Times New Roman]]] [[1922,810,1972,867][12][,I,][Times New Roman]], [[1948,810,2278,867][12][,,][Times New Roman]]Pad Transferee [[1573,866,2223,923][12][B,I,][Times New Roman]][{if Conveyance Agreement:} shall not pay, and Developer shall not accept, any payment [[2211,867,2300,924][12][,I,][Times New Roman]]of [[295,924,575,981][12][B,I,][Times New Roman]]__________ [[546,924,600,981][12][B,I,][Times New Roman]]/ [[575,924,625,981][12][B,I,][Times New Roman]]{ [[593,924,955,981][12][B,I,][Times New Roman]]if Ground Lease [[927,924,977,981][12][B,I,][Times New Roman]]: [[936,924,993,981][12][B,I,][Times New Roman]]} [[972,925,1061,982][12][,I,][Times New Roman]]of [[1023,925,1481,982][12][,I,][Times New Roman]]rent or additional ren [[1456,925,1506,982][12][,I,][Times New Roman]]t [[1464,925,1518,982][12][,I,][ Times New Roman]]] [[1501,925,1965,982][12][,,][Times New Roman]]more than thirty (30) [[1927,925,2146,982][12][,,][Times New Roman]]calendar [[2108,925,2300,982][12][,,][Times New Roman]]days in advance of the applicable due date under the Transfer Agreements. 6.4.Pad Transfereeshall sendto Citya copy of any notice or statement under the Transfer Agreementspertaining to adefault by Developer thereunder that would, if left uncured after any applicable notice and cure periods,permit the Pad Transferee to terminate its agreement(s) with Developer or otherwise cease construction on the Building Padat the same time as such default notice or statement is sent to Developer. If Developer shallhave failed to cure such default within the time period provided for in the Transfer Agreements,Pad Transfereeshall not exercise any remedies available by virtue of such default unless,(a)Pad Transfereeshallhave notified City in writing of Developer’s failure to cure such default,and (b)Pad Transfereeshall have afforded the City an additional sixty (60) calendar days from the receipt of such noticeto cure such default or if such default cannot be cured within sixty (60) calendar days, then such additional time as may be necessary if, within such sixty (60) day period, the City commences and thereafter diligently pursues the cure of such default (including, without limitation, commencement of possessory proceedings, if necessary toeffect such cure). If the City commencesto cure a Developer default, the Transfer Agreementsshall remain in fullforceand effect during the period that such cure is being diligently pursued,and Developer shall pay to the City all of the costs and expenses incurred by the City in curing or attempting to cure such default. Nothing in this Agreement shall require the City to cure any Developer default under the Transfer Agreements,and the exercise of such cure rights by the City shall be a right and notan obligation of the City. 6.5.Pad Transfereeshall, upon the execution of this Agreement and thereafter upon the request of aCity Successor, provide the City or another City Successorwith an estoppel certificate, in form and substance attached to the Transfer Agreementsor otherwise reasonably acceptable to the City Successor, stating, among other things, the following: (a)that a complete, true and correct copy of the Transfer Agreementsis attached thereto and is unmodified and in full force and effect (or, if there have been modifications,regardless of whether such modifications constitute Modifications as defined in Section 6.2of this Agreement,that such Transfer Agreementsarein full force and effect, as modified and stating the modifications, regardless of whether such modifications constitute Modifications as defined in Section 6.2, above,or if such Transfer Agreementsarenot in full force and effect, so stating);(b) the dates, if any, to which any rent and other sums payable under the Transfer Agreementshave been paid;(c)toPad Transferee’s knowledge, there are no defaults, claims thereof,any condition which, with the giving of notice and/or the passage of time or both, could become a default by either the Developeror Pad Tustin Cornerstone I DDA Att 22 Pad Transferee ATTACHMENT 22Cityof Tustin/Lincoln Cornerstone I NDA 6-13-2017 (agd) .docx-12- Transfereewith respect to their respective obligations under the Transfer Agreementsor under the performance of any term, covenant or condition contained in the Transfer Agreements; (d)Pad Transfereehas no claim, charge, defense or offset against anyamounts [[1831,415,1881,472][12][,I,][Times New Roman]][ [[1850,415,1934,472][12][,I,][Times New Roman]]{if [[1920,415,2264,472][12][,I,][ Times New Roman]]Ground Lease: [[2225,415,2280,472][12][,I,][Times New Roman]]} [[300,472,350,529][12][,I,][Times New Roman]], [[325,472,976,529][12][,I,][Times New Roman]]including without limitation, [[953,472,1084,529][12][,I,][Times New Roman]]rents [[1048,472,1102,529][12] [,I,][Times New Roman]]] [[1100,472,1446,529][12][,,][Times New Roman]]payable under [[1422,472,1534,529][12][,,][Times New Roman]]the [[1511,472,1980,529][12][,,][Times New Roman]]Transfer Agreements [[1950,472,2000,529][12][,,][Times New Roman]]; [[1991,472,2041,529][12][,,][Times New Roman]]( [[2007,472,2057,529][12][,,][Times New Roman]]e [[2029,472,2198,529][12][,,][Times New Roman]]) that [[2175,472,2300,529][12][,,][Times New Roman]]Pad Transfereeis not aware of any default which has not been cured,except as to defaults specified in said certificate,and(f) that Pad Transfereehasno right to terminate the Transfer Agreements. 6.6.Allclaims, demands or causes of action which Pad Transferee or any [[2167,695,2300,752][12][,I,][Times New Roman]]Pad [[300,752,545,809][12][,I,][Times New Roman]]Transferee [[531,752,781,809][12][,,][Times New Roman]]Successor [[745,752,2300,809][12][,,][Times New Roman]]may have or may have had against Developer as of the date City succeeds to the position of Developer under the Property Documents and, if applicable the Transfer Agreements, or on account of any matter, condition or circumstance arising out of the relationship of Developer and Pad Transferee under the Transfer Agreements, Pad Transferee’s occupancy of the Building Pad or Developer’s prior ownership thereof, shall be enforceable solely against the prior Developer to the extent provided in the Transfer Agreements, and neither the City nor any other City Successor shall be subject to any such claim, demand or cause of action. 6.7.Except as expressly set forth herein, this Agreement does not constitute a waiver by City of any of its rights under theProperty Documents.Except as expressly set forth herein, this Agreement does notin any way release Developer and/or Pad Transfereefrom their respective obligations to comply with the terms, provisions, conditions, covenants, agreements and clauses of theProperty Documents, including, without limitation, the release set forth in Section 4.5.2(f) of the DDA, the indemnity set forth in Section 5.5of the DDA, the insurance required in Article 11of the DDAand the indemnity, environmental indemnity and related requirements set forth in Sections10.1through 10.7of the DDA. 6.8.The provisions of this Agreement donot impair or modifythe City’s Right of Repurchaseor Right of Reversion contained in the DDA with respect to property other than the Building Pad. 6.9.Neither the City nor any City Successor shall have anyobligation nor shall the City or any City Successorincur any liability with respect to any warranties of any nature whatsoever, whether pursuant to the Transfer Agreementsor otherwise, including, but not limited to, any warranties respectingsuitabilityfordevelopment, use, compliance with zoning, Developer’sor Pad Transferee’stitle, Developer’sor Pad Transferee’sauthority, habitability,fitness for purpose or possession of the Building Pad. 6.10.Pad Transfereeis an End User and has not engaged and will not engage in a Prohibited Use upon the Building Pad. 7.Certificate of Compliance.The provisions of[[1390,2497,1440,2554][12][,I,][Times New Roman]][ [[1409,2497,1659,2554][12][,I,][Times New Roman]]Section 9.2 [[1634,2497,1931,2554][12][,I,][Times New Roman]](a) through ( [[1895,2497,1947,2554][12][,I,][Times New Roman]]g [[1916,2497,1972,2554][12][,I,][Times New Roman]]) [[1954,2497,2236,2554][12][,I,][Times New Roman]]of the DDA [[2201,2497,2251,2554][12][,I,][Times New Roman]]{ [[2221,2497,2300,2554][12][,I,][Times New Roman]]if [[300,2555,411,2612][12][,I,][Times New Roman]]the [[372,2555,596,2612][12][,I,][Times New Roman]]Building [[558,2555,936,2612][12][,I,][Times New Roman]]Pad is in Phase 1 [[905,2555,980,2612][12][ ,I,][Times New Roman]]}/ [[957,2555,1154,2612][12][,I,][Times New Roman]]Section [[1117,2555,1205,2612][12][,I,][Times New Roman]]9.3 [[1180,2555,1472,2612][12][,I,][Times New Roman]](a) through ( [[1436,2555,1488,2612][12][,I,][Times New Roman]]g [[1458,2555,1514,2612][12][,I,][Times New Roman]]) [[1493,2555,1741,2612][12][,I,][Times New Roman]]of the DDA [[1716,2555,1772,2612][12] [,I,][Times New Roman]]) [[1751,2555,1801,2612][12][,I,][Times New Roman]]{ [[1771,2555,1924,2612][12][,I,][Times New Roman]]if the [[1884,2555,2108,2612][12][,I,][Times New Roman]]Building [[2070,2555,2300,2612][12][,I,][Times New Roman]]Pad is in [[298,2612,492,2669][12][,I,][Times New Roman]]Phase 2 [[461,2612,517,2669][12][,I,][Times New Roman]]) [[478,2612,533,2669][12][,I,][Times New Roman]]} [[522,2612,1632,2669][12][,,][Times New Roman]]shall apply to Pad Transferee’s ability to obtain a C [[1616,2612,2144,2669][12][,,][Times New Roman]]ertificate of Compliance [[2136,2612,2300,2669][12][,,][Times New Roman]]under Section 9.2or 9.3of the DDA. Accordingly, provided that Pad Transferee has satisfied for the Building Pad in question the obligations in such clauses (a) through (g) and is not then inDefault under the DDA or in default under any of the otherProperty Documents, the City shall issue a Certificate of Compliance, regardless of whether the Developer who retains the remainder of the Tustin Cornerstone I DDA Att 22 Pad Transferee ATTACHMENT 22Cityof Tustin/Lincoln Cornerstone I NDA 6-13-2017 (agd) .docx-13- Development Parcels is then in Default under the DDA or in default under any of the other Property Documents. 8.Notices.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, OverniteExpress, 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 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 emailto the fax number or email address set forth below; provided that notices given by facsimile or email shallnot be effective unless either, (i)a duplicate copy of such notice is promptly sent by any method permitted under this Section18.6other 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 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:Jeffrey C. Parker, City Manager City of Tustin 300 Centennial Way Tustin, CA 92780 Fax: 714-838-1602 Email: jparker@tustinca.org With a copy to:David Kendig Woodruff Spradlin & Smart, APC 555 Anton Boulevard, #1200 Costa Mesa, CA 92626 Fax: (714) 415-1183 Email: dkendig@wss-law.com Developer:_________________ _________________ _________________ _________________ With a copy to:_________________ _________________ _________________ Tustin Cornerstone I DDA Att 22 Pad Transferee ATTACHMENT 22Cityof Tustin/Lincoln Cornerstone I NDA 6-13-2017 (agd) .docx-14- _________________ Pad Transferee:_________________ _________________ _________________ _________________ With a copy to:_________________ _________________ _________________ _________________ Any Party may by written notice to the other Party in the manner specified in this Agreement change the address to which notices to such Party shall be delivered. 9.Preparation Costs.Developer shall pay to the City the City’s out-of-pocket fees and expenses, including legal fees, incurredwith respect to the preparation and delivery of this Agreement. 10.Miscellaneous. 10.1.Agreement Supersedes.This Agreement supersedes any inconsistent provision of the Transfer Agreements. 10.2.Modification.No amendment, change, modification or supplement to this Agreement shall be valid and bindingon the Parties unless in writing, signed by all of the Parties, acknowledged by a notary public and duly recorded in the Official Records. 10.3.Applicable Law.This Agreement 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.The parties hereto agree that the resolution of any dispute between or among them, or any of them, shall be resolved in accordance with the procedures and in the venue and subject to the service of process and other provisions set forth in Section 18.1of the DDA. 10.4.Legal Fees and Costs. If any Party to this Agreement institutes any action, suit, counterclaim or other proceeding for any relief against another Party, declaratory or otherwise Action (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 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) the Prevailing Party’s reasonable attorneys’fees (which.if the Prevailing Party is the City,shall be payable at the actual contractual hourly rate for City’s litigationcounsel at the time the fees were incurred,and which with respect to City, Developer and Pad Transferee shall inno event be morethan $200 per hour),and (b) costs actually incurred in bringing and prosecuting such Actionand/or enforcing any judgment, order, ruling or Tustin Cornerstone I DDA Att 22 Pad Transferee ATTACHMENT 22Cityof Tustin/Lincoln Cornerstone I NDA 6-13-2017 (agd) .docx-15- Decision 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 Costs and expert fees and 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: (a)post judgment motions and collection actions; (b)contempt proceedings; (c)garnishment, levy, debtor and third party examinations; (d)discovery; (e)bankruptcy litigation,and (f)appeals of any order or judgment. Prevailing Party “” within the meaning of this Section10.4includes 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. 10.5.No Partnership.Nothing contained in this Agreement shall be deemed or construed to create a partnership, joint venture or any other relationship between the parties or cause the City to be responsible in any way for the debts or obligations of Developeror Pad Transferee. 10.6.Construction and Interpretation of Agreement.This Agreement shall be construed and interpreted pursuant to the provisions of Section 18.10of the DDA. 10.7.Limitations on Damages Payable by the City.The provisions of Section 18.5.1and 18.5.2of the DDA are incorporated herein by this reference and as used therein, the term Developer “” shall mean and include Developer and Pad Transferee.The provisions of Section18.5.3of the DDA shall not apply to Pad Transferee. 10.8.No Waiver. 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 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. 10.9.Successors and Assigns.This Agreement and the covenants, conditions, restrictions, obligations, rights and benefits contained herein are hereby agreed by Developer, Pad Transfereeand the City to be covenants running with the land and enforceable as equitable servitudes for the benefit of the City and againstthe[[1342,2447,2123,2504][12][,I,][Times New Roman]]{Phase 1 Property/Phase 2 Property} [[2105,2447,2300,2504][12][,,][Times New Roman]]and the Building Pad, and are hereby declared to be and shall be binding upon the Building Pad, Developer, Pad Transfereeand the successors and assigns of Developer and/or Pad Transfereeowning or leasing all or any portion of the Building Pad.Notwithstanding the foregoing, until a Certificate of Compliance has been issued for the Building Pad, no Transfer, including by Transfer of Control, shall be valid or have any force or effect unless the City shall have provided its prior written consent thereto as may be required by the DDA. Tustin Cornerstone I DDA Att 22 Pad Transferee ATTACHMENT 22Cityof Tustin/Lincoln Cornerstone I NDA 6-13-2017 (agd) .docx-16- 10.10.Counterparts.This Agreement may be executed in two or more separate counterparts, each of which, when so executed, shall be deemed to be an original. Such counterparts shall, together, constitute and shall be one and the same instrument. This Agreement shall not be effective until the execution and delivery by the Parties of at least one set of counterparts. The Parties agree to recognize execution of this Agreement by facsimile 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. The Parties hereby authorize each other to detach and combine original signature pages and consolidate them into a single identical original. Any one of such completely executed counterparts shall be sufficient proof of this Agreement. 10.11.Execution of this Agreement by the City constitutes the City’s acknowledgment that the requirements of Section2.2.3(c)(i),(ii)and (iv)of the DDA have been satisfied with respect to the Transfer described in this Agreement, provided that neitherthis consent nor execution by the City of this Agreement constitute evidence of compliance with or satisfaction of any obligation of Developer or Pad Transfereeunderthe Property Documents, or any one or more thereof or any other agreement between Developer and the City, except for the obligation of Developer to obtain the City’s consent to a Transfer toPad Transferee. [[852,1542,902,1599][12][,I,][Times New Roman]]{ [[872,1542,1131,1599][12][,I,][Times New Roman]]signatures [[1093,1542,1354,1599][12][,I,][Times New Roman]]commence [[1316,1542,1619,1599][12][,I,] [Times New Roman]]on following [[1574,1542,1706,1599][12][,I,][Times New Roman]]page [[1673,1542,1728,1599][12][,I,][Times New Roman]]} Tustin Cornerstone I DDA Att 22 Pad Transferee ATTACHMENT 22Cityof Tustin/Lincoln Cornerstone I NDA 6-13-2017 (agd) .docx-17- IN WITNESS WHEREOF, the Partieshereto have caused this Agreement to be duly executed as of the date first above set forth. CITY “” City of Tustin Dated: ______________________By: __________________________________ Jeffrey C. Parker ATTEST:City Manager By Erica Rabe, City Clerk APPROVED AS TO FORM By: David Kendig, City Attorney Armbruster Goldsmith & Delvac LLP Special Tustin Counsel By: Amy E. Freilich DEVELOPER: Dated: __________________ [[1526,2340,1711,2397][12][B,I,][Times New Roman]][insert] By: __________________________________ Name: Title: Tustin Cornerstone I DDA Att22 Pad Transferee ATTACHMENT 22Cityof Tustin/Lincoln Cornerstone I NDA 6-13-2017 (agd) .docx S-1 PAD TRANSFEREE Dated: __________________“” [_________________], a [__________________] By: ________________________ Name: ______________________ Title: ________________________ Tustin Cornerstone I DDA Att 22 Pad Transferee ATTACHMENT 22Cityof Tustin/Lincoln Cornerstone I NDA 6-13-2017 (agd) .docx S-2 Attachment 24 Form of Subordination Agreement ATTACHMENT 24 FORM OF SUBORDINATION AGREEMENT RECORDING REQUESTED BY AND WHEN RECORDED MAIL TO: The City of Tustin 300 Centennial Way Tustin, CA 92708 Attn: City Manager SPACE ABOVE THIS LINE FOR RECORDER’S USE TUSTIN CORNERSTONE I SUBORDINATION AGREEMENT [[1049,1019,1245,1072][11][,I,][Times New Roman]]{(PHASE [[1234,1019,1284,1072][11][,I,][Times New Roman]]1 [[1267,1019,1319,1072][11][,I,][Times New Roman]]/ [[1291,1019,1533,1072][11][,I,][Times New Roman]]PHASE 2)} THIS TUSTIN CORNERSTONE ISUBORDINATION AGREEMENT[[1798,1121,2034,1174][11][,I,][Times New Roman]][(PHASE 1 [[2016,1121,2068,1174][11][,I,][Times New Roman]]/ [[2040,1121,2282,1174][11][,I,][Times New Roman]]PHASE 2)] AgreementEffective Date (this “”) is entered into as of the day of ___________, 20(the “”), by and between ________________, a ________________ and as further defined in Section 1below, the LenderTHE “”) [[516,1280,566,1333][11][,I,][Times New Roman]][ [[534,1280,1525,1333][11][,I,][Times New Roman]]TEXT TO BE MODIFIED IF TWO OR MORE CO [[1508,1280,1558,1333][11][,I,][Times New Roman]]- [[1522,1280,2043,1333][11][,I,][Times New Roman]]LENDERS UNDER LOAN [[2019,1280,2073,1333][11][,I,][Times New Roman]]] [[2042,1280,2187,1333][11][,,][Times New Roman]], and CITYOFTUSTIN, CALIFORNIA , a municipal corporation duly organized and existing under the laws City of the State of California (as further defined inSection 1below. the “”). RECITALS Flight A.The City andFlight Venture LLC, a Delaware limited liabilitycompany (“ Venture ”), entered into that certain Tustin LegacyDisposition and Development Agreement Cornerstone I dated as ofNovember 15, 2016, as amended by that certain First Amendment toTustin LegacyDisposition and Development Agreement Cornerstone I dated as of June 20, 2017 (collectively, and as the same may DDA be further amended from time to time, the “”), with respect to certain real property referred to therein as the “Development Parcels”. A Memorandum of DDA was recorded against the Development Parcelsin Official Records the Official Records of Orange County, California (“”) on _______________ 20__ as Memorandum Instrument No.________ (the “”). Capitalized terms used herein and not otherwise defined herein shall have the meanings set forth in the DDA. B.City and Flight Venture entered into that certain Development Agreement dated as of December 15, 2016 and recorded in the Official Records on ________, 2017 as Instrument DA No._______________ (the “”). C.Flight Venture has assigned its rights and obligations under the DDA with respect to the _____________Borrower Parcel (as defined below) to ______________[[1455,2376,1505,2429][11][,I,][Times New Roman]]{ [[1473,2376,2012,2428][11][B,I,][Times New Roman]]insert name of Transferee} [[1989,2376,2055,2429][11][, ,][Times New Roman]](“ [[2215,2376,2300,2429][11][,,][Times New Roman]]”) by an Assignment and Assumption Agreement dated _______________ and recorded in the Official Records on _____________, 20__ as Instrument No. ____________. D.Pursuant to the DDA, the City has conveyed to Borrower a portion of the Development Parcels referred to in the DDA as the [[968,2636,1336,2689][11][,I,][Times New Roman]][“Phase 1 Parcel” [[1321,2636,1373,2689][11][,I,][Times New Roman]]/ [[1347,2636,1685,2689][11][,I,][Times New Roman]]“Phase 2 Parcel [[1647,2636,1697,2689][11][,,][Times New Roman]]” [[1663,2636,1717,2689][11][,I,][Times New Roman]]] [[1686,2636,2300,2689][11][,,][Times New Roman]], comprised of the real property Parcel legally described on ExhibitAattached hereto (the “”), together with certain Improvements thereon and appurtenances thereto as further described in the DDA [[1395,2742,1595,2795][11][,I,][Times New Roman]][(“Phase [[1579,2742,1827,2795][11][,I,][Times New Roman]]1 Property” [[1811,2742,1863,2795] [11][,I,][Times New Roman]]/ [[1838,2742,2216,2795][11][,I,][Times New Roman]]“Phase 2 Property [[2186,2742,2256,2795][11][,,][Times New Roman]]”) [[2216,2742,2288,2795][11][,I,][Times New Roman]]]. In accordance with the DDA, the Parcel is or will be improved with Office Uses and ancillary retail uses, including development of, at a minimum, the Minimum [[1477,2847,1905,2900][11][,I,][Times New Roman]][Phase 1/Phase 2] [[1885,2847,2299,2900][11][,,][Times New Roman]]Improvements (the Improvements “”). The Parcel, the Improvements and related personal and other property described in the Tustin Cornerstone I DDA Att 24 FORM ATTACHMENT 24City of Tustin/Flight Venture Subordination Agt 06-12-2017.docx1 Security Instrument (defined herein) and the other Security Documents (defined herein) constitute the Mortgaged Property “”.The City and [[1067,352,1605,405][11][,I,][Times New Roman]]{Borrower/Flight Venture} [[1594,352,1928,405][11][,,][Times New Roman]]have also previ [[1890,352,2300,405][11][,,][Times New Roman]]ously executed the following documents, each of which has been recorded against the [[1527,405,2171,457][11][B,I,][Times New Roman]][Phase 1 Parcel/Phase 2 Parcel] [[2148,405,2301,458][11][,,][Times New Roman]]in the Official Records on ___________, 20__ (collectively with the DDA, the DA, and the Memorandum, as the Property Documents same may be amended from time totime, the “”): (1)Declaration of Special Restrictionsfor Cornerstone I[[1710,613,1961,666][11][,I,][Times New Roman]][for Phase 1 [[1944,613,1996,666][11][,I,][Times New Roman]]/ [[1968,613,2163,666][11][,I,][Times New Roman]]Phase 2] [[2132,613,2182,666][11][,I,][Times New Roman]], [[2152,613,2301,666][11][,,][Times New Roman]]dated as of _______________, 20__ and recorded in the Official Records as Instrument No. ______________ Special Restrictions (the “”) (recorded prior to the Quitclaim Deed and to which Borrower’s fee title to the Parcel is subject); (2)Quitclaim Deed for Tustin Legacy Cornerstone I –Phase [[1852,874,1902,927][11][,I,][Times New Roman]][ [[1870,874,1956,926][11][B,I,][Times New Roman]]1/2 [[1924,874,1978,927][11][,I,][Times New Roman]]] [[1963,874,2300,927][11][,,][Times New Roman]]and Covenants, Conditions and Restrictions, Including Environmental Restriction Pursuant to Civil Code Section 1471, dated as of ______________, 20__ and recorded in the Official Records as Instrument No. Quitclaim Deed __________________ (the “”); (3)Landscape Installation and Maintenance Agreement dated as of _______________, 20__ and recorded in the Official Records as Instrument No. ______________; (4)Roadway, Landscape and Utility Easement Agreement dated as of _______________, 20__ and recorded in the Official Records as Instrument No. ______________; (5)Master Declaration Establishing Maintenance and Cost Sharing Obligations for Tustin Legacy Cornerstone I dated as of _______________, 20__ and recorded in the Official Records as Instrument No. ______________; and (6)Declaration of Covenants, Conditions and Restrictions and Establishment of Easements for The Flight at Tustin Legacy dated as of _______________, 20__ and recorded in the Official Records as Instrument No. ______________; and (7)Special Land Use Restrictions as of _______________, 20__ and recorded in the Official Records as Instrument No. ______________. [[1298,1914,1397,1967][11][,I,][Times New Roman]][{in [[1371,1914,1870,1967][11][,I,][Times New Roman]]clude only if applicable}] (8)[[750,2017,800,2070][11][,I,][Times New Roman]][ [[769,2017,1183,2069][11][B,I,][Times New Roman]]{For Phase 1 only:} [[1163,2017,2300,2070][11][,I,][Times New Roman]]a License Agreement for Site Development with respect to construction[[548,2070,2301,2123][11][,I,][Times New Roman]]of the Minimum Horizontal Improvements on the Phase 2 Parcel, a License Agreement [[300,2122,1403,2175][11][,I,][Times New Roman]](Staging and Construction Parking) with respect to stagi [[1366,2122,2300,2175][11][,I,][Times New Roman]]ng and parking for construction of the Phase 1 [[298,2175,473,2228][11][,I,][Times New Roman]]Project [[447,2175,1022,2228][11][,I,][Times New Roman]]each dated _____________; [[983,2175,1079,2228][11][,I,][Times New Roman]]and (9)[[750,2278,2061,2331][11][,I,][Times New Roman]]a License Agreement for Phase 2 Due Diligence, dated __________.] E.In connection with the conveyance of the Parcel to Borrower, ___________ (individually Guarantor and collectively as the context may require “”), a ______________________ [[1910,2433,1960,2486][11][,I,][Times New Roman]]{ [[1928,2433,2300,2485][11][B,I,][Times New Roman]]state relationship [[300,2486,576,2538][11][B,I,][Times New Roman]]to Borrower} [[551,2486,1118,2539][11][,,][Times New Roman]]has executed and delivered a [[1076,2486,1445,2539][11][,I,][Times New Roman]]{Phase 1/Phase 2} [[1422,2486,2300,2539][11][,,][Times New Roman]]Guaranty to the City dated _______________ Guaranty (“”). F.Lender has agreed to make a loan to Borrower in the maximum principal amount of Loan $_______________ (the “”) for the construction, development, equipping and/or operation of the Project on the Parcel, which Loan is initially evidenced by that/those certain [[1806,2747,2301,2799][11][B,I,][Times New Roman]][{fill in correct title of [[298,2799,503,2851][11][B,I,][Times New Roman]]Note[s]}] [[480,2799,774,2852][11][,,][Times New Roman]]dated as of___ [[747,2799,1945,2852][11][,,][Times New Roman]]_____, 201_ made by Borrower payable to the order of Lender [[1904,2799,2300,2851][11][B,I,][Times New Roman]][or one or more of Note [[300,2852,917,2904][11][B,I,][Times New Roman]]the Persons named as Lender] [[896,2852,946,2905][11][,,][Times New Roman]]( [[911,2852,961,2905][11][,I,][Times New Roman]][ [[929,2852,1193,2905][11] [,,][Times New Roman]]collectively, [[1150,2852,1204,2905][11][,I,][Times New Roman]]] [[1185,2852,1305,2905][11][,,][Times New Roman]]the “ [[1368,2852,1754,2905][11][,,][Times New Roman]]”) and that certain [[1716,2852,2301,2904][11][B,I,][Times New Roman]][{fill in correct title of Loan Loan Agreement [[296,2905,573,2957][11][B,I,][Times New Roman]]Agreement}] [[550,2905,1679,2958][11][,,][Times New Roman]]dated as of the date hereof between Borrower and Lender (t [[1642,2905,1746,2958][11][,,][Ti mes New Roman]]he “ [[2046,2905,2132,2958][11][,,][Times New Roman]]”). Tustin Cornerstone I DDA Att 24 FORM ATTACHMENT 24City of Tustin/Flight Venture Subordination Agt 06-12-2017.docx2 G.The Loan is secured by, among other things, that certain [[1635,300,2300,352][11][B,I,][Times New Roman]]{insert full document title for the [[298,353,1788,405][11][B,I,][Times New Roman]]Deed of Trust encumbering any portion of Borrower’s interest in the Parcel [[1756,353,2285,405][11][B,I,][Times New Roman]]for the benefit of Lender} Security Instrument dated as of the date hereof executed byBorrower for the benefit of Lender (the “”); together with those certain [[811,457,2299,509][11][B,I,][Times New Roman]]{insert full document titles for the other security documents that encumber [[300,511,1992,563][11][B,I,][Times New Roman]]any portion of the Borrower’s interest in the Parcel for the benefit of Lender, includi [[1955,511,2300,563][11][B,I,][Times New Roman]]ng any security Security Documents [[300,563,795,615][11][B,I,][Times New Roman]]agreement, UCC filings} [[771,563,1679,616][11][,,][Times New Roman]](collectively, with the Security Instrument, the “ [[2042,563,2300,616][11][,,][Time s New Roman]]”); together with the Note, the Loan Agreement, and all other documents executed in connection with the Loan, including, without limitation, any guaranty or guaranties relating to the Loan made by a Loan Guarantor, Loan Documents all of which documents are sometimes referred to collectively as the “”), which Security Instrument encumbers the Mortgaged Property and was recorded in the Official Records concurrently herewith. All references herein to the Loan Documents, the Security Instrument or the Security Documents, as the case may be, or any thereof shall mean the Loan Documents, the Security Instrument or the Security Documents, as the case may be, or any thereof, as the same may be amended, restated, replaced, supplemented or otherwise modified from time to time. H.[[598,1087,650,1139][11][B,I,][Times New Roman]][ [[615,1087,1526,1139][11][B,I,][Times New Roman]]{If applicable:} {PARENTS OF BORROWER} [[1503,1087,2299,1140][11][,,][Times New Roman]]have executed an “Assignment of Equity Interests, Pledge and Security Agreement” in favor of Lender dated as of_______, 201_ (the Assignment “”).[[592,1193,646,1246][11][,I,][Times New Roman]]] I.[[598,1295,1228,1347][11][B,I,][Times New Roman]][{If the loan is a junior loan [[1203,1295,2300,1348][11][,I,][Times New Roman]]:} Lender acknowledges that the Property is already [[300,1348,1945,1401][11][,I,][Times New Roman]]encumbered by a [Insert exact title of Deed of Trust] in favor of __________ (the “ [[1920,1348,2231,1400][11][B,I,][Times New Roman]]Senior Lender [[2198,1348,2299,1401][11][,I,][Times New Roman]]”), [[300,1401,855,1454][11][,I,][Times New Roman]]dated______ and recorded i [[818,1401,1830,1454][11][,I,][Times New Roman]]n the Official Records as Instrument ____________(“ [[1804,1401,2235,1453][11 ][B,I,][Times New Roman]]Senior Deed of Trust [[2198,1401,2299,1454][11][,I,][Times New Roman]]”). [[300,1453,2004,1506][11][,I,][Times New Roman]]The loan secured by the Senior Deed of Trust is sometimes referred to as the Senior Loan.] J.As a condition to the making of the Loan, Lender requires and Borrower requests that the City and Lender execute and deliver this Agreement. NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows: 1.DEFINITIONS. The following terms, when used in this Agreement (including, as appropriate, when used in the above recitals), shall have the following meanings. Action (a)“” has the meaning set forth in Section 5(h)of this Agreement. Agreement (b)“” has the meaning set forth in the first paragraph of this Agreement. (c)[[748,2330,1009,2382][11][B,I,][Times New Roman]][{If Recital [[969,2330,1021,2382][11][B,I,][Times New Roman]]H [[1018,2330,1305,2382][11][B,I,][Times New Roman]]is included:} [[1267,2330,1317,2383][11][,I,][Times New Roman]]“ [[1288,2330,1551,2382][11][B,I,][Times New Roman]]Assignment [[1514,2330,2256,2383][11][,I,][Times New Roman]]” has the meaning set forth in Recital [[2215,2330,2268,2383][11][,I,][Times New Roman]]H [[300,2383,704,2436][11][,I,][Times New Roman]]to this Agreement.] Borrower (d)“” means all Persons identified as “Borrower” in the Recitals of this Agreement, together with their successors and assigns, and any other Person who acquires title to the Mortgaged Property after the date of this Agreement during the period that the Mortgaged Property is encumbered by the Security Instrument; provided that, except as set forth in Section 4(c)of this Agreement, the term “Borrower” shall not include any Lender or Lender Affiliate in the event that any Lender or Lender Affiliate may acquire title to the Mortgaged Property. Casualty (e)“” means the occurrence of damage to or loss of all or any portion of the Mortgaged Property by fire orother casualty. Tustin Cornerstone I DDA Att 24 FORM ATTACHMENT 24City of Tustin/Flight Venture Subordination Agt 06-12-2017.docx3 City (f)“” means the Person named as such in the first paragraph of this Agreement. City Lien (g)“” shall have the meaning set forth in Section 16.2of the DDA as set forth verbatim in the Memorandum. City Notice (h)“” means a written notice from the City to the Borrower or Guarantor of any Default under the DDA or any “default” under any of the other Property Documents or the Guaranty (including, without limitation, any notice that Guarantor fails to satisfy a Liquidity Covenant or the Minimum Liquidity Standard or that any Guarantor Illiquidity Event or City Guarantor Illiquidity Event has occurred, as applicable). Costs (i)“” has the meaning set forth in Section 5(h)of this Agreement. DA (j)“” has the meaning set forth in Recital B of this Agreement. DDA (k)“” has the meaning set forth in Recital A of this Agreement. Decision (l)“” has the meaning set forth in Section 5(h)of this Agreement. Effective Date (m)“” has the meaning set forth in the first paragraph of this Agreement. Enforcement Action (n)“” means any of the following actions taken by or at the direction of the City: the exercise of the City’s Right of Reversion under Section 16.4of the DDA, the exercise of the City’s Right of Repurchase under Section 16.3of the DDA, the obtaining of or seeking of the appointment of a receiver, the seeking of default interest or charges, the taking of possession or control of any of the Mortgaged Property, the commencement of any suit or other legal, administrative, or arbitration proceeding based upon the Property Documents, or the exercise of any other remedy against the Borrower or the Mortgaged Property, excepting, however, any rights or actions taken by the City in the exercise of its police powers. Flight Venture (o)“” has the meaning set forth in Recital A to this Agreement. Guaranty (p)“” has the meaning set forth in Recital Eto this Agreement. Guaranto (q)“r” has the meaning set forth in Recital Eto this Agreement. Improvements (r)“” has the meaning set forth in Recital D to this Agreement. Indebtedness (s)“” means the “Debt” as defined in the [[1745,2320,2300,2372][11][B,I,][Times New Roman]]{Loan Agreement/Security [[298,2372,562,2424][11][B,I,][Times New Roman]]Instrument} [[528,2372,578,2425][11][,,][Times New Roman]]. [[549,2372,2301,2424][11][B,I,][Times New Roman]]{confirm this term is used in Security Instrument and or Loan Agreement or define utilizing [[700,2422,750,2455][7][B,I,][Times New Roman]]1 [[300,2426,733,2478][11][B,I,][Times New Roman]]term utilized therein} Lender (t)“” means, individually and collectively, the entity or entities (as applicable) named as such in the first paragraph of this Agreement which is/are initially the holder(s) of the Note, and any other Person which subsequently becomes the holder of a Note. For purposes of any matters with 1 To be replaced in Phase 1 version with: “means the “Debt” as defined in the Loan Agreement.” Tustin Cornerstone I DDA Att 24 FORM ATTACHMENT 24City of Tustin/Flight Venture Subordination Agt 06-12-2017.docx4 Lender respect to and/or following a Foreclosure, “” shall mean Lender or any Lender Affiliate thereof designated by Lender to take title to the Mortgaged Property. Lender Affiliate (u)“” shall mean any Person Controlling or Controlled by a Lender or having the same Controlling Person as does a Lender. LenderStatement (v)“” has the meaning set forth in Section 3(i)of this Agreement. Loan (w)“” has the meaning set forth in Recital Fto this Agreement. Loan Agreement (x)“” has the meaning set forth in Recital Fto this Agreement. Loan Default (y)“” means (i) any act, failureto act, event, condition, or occurrence which constitutes, or which with the giving of notice or the passage of time, or both, would constitute, an “Event of Default”[[666,1024,1747,1076][11][B,I,][Times New Roman]]{or insert comparable term from Security Instrument} [[1711,1024,2299,1077][11][,,][Times New Roman]]under (and as defined in) the Security Instrument and other Loan Documents, or (ii) any “Event of Default” [[1745,1076,2299,1128][11][B,I,][Times New Roman]]{or insert comparable term [[292,1129,832,1181][11][B,I,][Times New Roman]]from Security Instrument} [[809,1129,2280,1182][11][,,][Times New Roman]]under (and as defined in) the Security Instrument and other Loan Documents. Loan Documents (z)“” has the meaning set forth in Recital Gto this Agreement. Loan Guarantor (aa)“” shall initially mean the Guarantor. If other entities guarantee to Lender any obligations of Borrower under any of the Loan Documents, such entity shall also be a Loan Guarantor. Loss Proceeds (bb)“” means all monies received or to be received under any insurance policy, from any condemning authority, or from any other source, as a result or any Condemnation or Casualty. Memorandum (cc)“” has the meaning set forth in Recital A to this Agreement. Mortgaged Property (dd)“” has the meaning set forth in Recital D to this Agreement. Note (ee)“” has the meaning set forth in Recital Fto this Agreement. Official Records (ff)“” has the meaning set forth in Recital A to this Agreement. Parcel (gg)“” has the meaning set forth in Recital D to this Agreement. Person (hh)“” means 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. Prevailing Party (ii)“” has the meaning set forth in Section 5(h)of this Agreement. Property Documents (jj)“” has the meaning set forth in Recital Dto this Agreement. Property Document Breach (kk)“” means any act, failure to act, event, condition, or occurrence that allows (but for any contrary provision of this Agreement), or which with the giving of notice or the passage of time, or both, would allow (but for any contrary provision of this Agreement), the City to take an Enforcement Action. Quitclaim Deed (ll)“” has the meaning set forth in Recital Dto this Agreement. Tustin Cornerstone I DDA Att 24 FORM ATTACHMENT 24City of Tustin/Flight Venture Subordination Agt 06-12-2017.docx5 Rents (mm)“”has the meaning given to the term in the Security Instrument. Security Documents (nn)“” has the meaning set forth in Recital Gto this Agreement. Security Instrument (oo)“” has the meaning set forth in Recital Gto this Agreement. (pp)[[748,607,1011,659][11][B,I,][Times New Roman]][{If Recital [[973,607,1025,659][11][B,I,][Times New Roman]]I [[1007,607,1296,659][11][B,I,][Times New Roman]]is included:} [[1259,607,1309,660][1 1][,I,][Times New Roman]]“ [[1283,607,1725,659][11][B,I,][Times New Roman]]Senior Deed of Trust [[1688,607,2299,660][11][,I,][Times New Roman]]” has the meaning set forth in [[298,660,481,713][11][,I,][Times New Roman]]Recital [[439,660,491,713][11][,I,][Times New Roman]]I [[468,660,872,713][11][,I,][Times New Roman]]to this Agreement.] (qq)[[748,763,1008,815][11][B,I,][Times New Roman]][{If Recital [[967,763,1019,815][11][B,I,][Times New Roman]]I [[997,763,1283,815][11][B,I,][Times New Roman]]is included:} [[1243,763,1293,816][11 ][,I,][Times New Roman]]“ [[1268,763,1572,815][11][B,I,][Times New Roman]]Senior Lender [[1540,763,2275,816][11][,I,][Times New Roman]]” has the meaning set forth in Recital [[2233,763,2285,816][11] [,I,][Times New Roman]]I [[300,815,386,868][11][,I,][Times New Roman]]to [[347,815,703,868][11][,I,][Times New Roman]]this Agreement.] Special Restrictions (rr)“” has the meaning set forth in Recital Dto this Agreement. 2.PERMITTED MORTGAGEE. (a)In accordance with the Section 17.2of the DDA, the City hereby: (i)consents to Borrower entering into the Loan; (ii)acknowledges receipt of the documents listed on ExhibitBattached hereto, comprising the “Loan Documents” under this Agreement; (iii)confirms that: (A)each Person comprising Lender is approved as a Permitted Mortgagee and each is accordingly entitled to, and a beneficiary of, all rights of a Permitted Mortgagee under the DDA and subject to all obligations imposed upon a Permitted Mortgagee under the DDA; (B)the Loan Documents delivered to the City on or before the date hereof comply with the requirements of the DDA applicable thereto, including without limitation, Sections 17.1and 17.3of the DDA, and are accordingly approved by the City for all purposes of the DDA, to the extent such approval is required by the terms of the DDA;and (C)the Security Instrument, as a deed of trust creating a security interest in a portion of the Property made in favor of a Permitted Mortgagee and comprising a Construction Loan, is a Permitted Mortgage; (D)the stated principal amount of the Loan conformswith the loan to cost ratio required to qualify as a Construction Loan under the test established by Section 17.1.1(f)of the DDA; (E)the Loan is approved by the City as a Construction Loan; (F)Loan proceeds may be used for the purposes set forth in the Loan Documentsdelivered to the City on or before thedate hereof; (G)the [[1122,2730,1172,2783][11][,I,][Times New Roman]][ [[1139,2730,1320,2783][11][,I,][Times New Roman]]Phase 1 [[1287,2730,1341,2783][11][,I,][Times New Roman]]] [[1310,2730,1360,2783][11][,I,][T imes New Roman]][ [[1326,2730,1507,2783][11][,I,][Times New Roman]]Phase 2 [[1474,2730,1528,2783][11][,I,][Times New Roman]]] [[1513,2730,1845,2783][11][,,][Times New Roman]]Financing Plan [[1811,2730,1937,2783][11][,,][Times New Roman]]most [[1900,2730,1950,2783][11][,,][Times New Roman]]- [[1915,2730,2300,2783][11][,,][Times New Roman]]recently delivered by Borrower to the City pursuant to Section 4.6.1of the DDA, together with any amendments thereto, delivered to the City on or before the [[986,2836,1036,2889][11][,I,][Times New Roman]][ [[1002,2836,1176,2889][11][,I,][Times New Roman]]Phase 1 [[1145,2836,1199,2889][11][,I,][Times New Roman]]] [[1168,2836,1218,2889][11][,I,][Times New Roman]][ [[1184,2836,1358,2889][11][,I,][Times New Roman]]Phase 2 [[1326,2836,1380,2889][11][,I,][Times New Roman]]] [[1360,2836,1567,2889][11] [,,][Times New Roman]]Property [[1529,2836,1810,2889][11][,,][Times New Roman]]Close of Escr [[1775,2836,1892,2889][11][,,][Times New Roman]]ow, [[1853,2836,2299,2889][11][,,][Times New Roman]]has been approved by the City; Tustin Cornerstone I DDA Att 24 FORM ATTACHMENT 24City of Tustin/Flight Venture Subordination Agt 06-12-2017.docx6 (H)to the extent required by the DDA, the Loan as described in the Loan Documents delivered to the City on or before the date hereof is consistent with the [[1937,352,1987,405][11][,I,][Times New Roman]][ [[1954,352,2130,405][11][,I,][Times New Roman]]Phase 1 [[2098,352,2152,405][11][,I,][Times New Roman]]] [[2120,352,2170,405][11][,I,][Times New Roman]][ [[2136,352,2299,405][11][,I,][Times New Roman]]Phase [[300,405,350,458][11][,I,][Times New Roman]]2 [[318,405,372,458][11][,I,][Times New Roman]]] [[353,405,1289,458][11][,,][Times New Roman]]Financing Plan approved by the City or the City [[1251,405,2300,458][11][,,][Times New Roman]]has approved or waived any such noncompliance with the [[367,457,417,510][11][,I,][Times New Roman]][ [[384,457,559,510][11][,I,][Times New Roman]]Phase 1 [[527,457,581,510][11][,I,][Times New Roman]]] [[550,457,600,510][11][,I,][Times New Roman]][ [[566,457,742,510][11][,I,][Times New Roman]]Phase 2 [[709,457,763,510][11][,I,][Times New Roman]]] [[743,457,1046,510][11][,,][Times New Roman]]Financing Plan [[1031,457,1353,510][11][ ,,][Times New Roman]]as described in [[1314,457,1539,510][11][,,][Times New Roman]]clause (G) [[1516,457,1655,510][11][,,][Times New Roman]]above [[1625,457,1675,510][11][,,][Times New Roman]]; [[1649,457,1743,510][11][,,][Times New Roman]]and (I)the City Manager or his/her designee is authorized to execute and deliver each City Statement required hereunder and that such City Statement shall bind the City. (iv) acknowledges and agrees that (A) Borrower is entitled to share all information concerning the Project, the Mortgaged Property and the Property Documents with Lender notwithstanding any provisions set forth in the DDAor any other Property Document to the contrary, (B) City is not relying on the Lender for any purposes, except for compliance with the Lender’s obligations expressly set forth in this Agreement, the DDA and/or the Property Documents, including, without limitation, obligations imposed on Lender in its capacity as a Permitted Mortgagee,(C) notwithstanding anything to the contrary in the DDA or this Agreement, the Lender shall have no obligation or liability to the City or under the DDA or this Agreement in the event that Borrower uses any proceeds of the Loan in violation of the Loan Documents or the DDA, (D) the Lenderdoes not have, and shall not have, any fiduciary duties to the City (including any fiduciary duties relating to Lender’s or its agents’ servicing, administration, and enforcement of the Loan), and (E) the Lender does not have, and shall not have, any express or implied duties to the City other than Lender’s duties and obligations expressly set forth in this Agreement, the DDA and/or the Property Documents. In addition, the City agrees that (x) it will deliver to Lender, at the times specified in Section 3(j), the City Statement in the form of the document attached as City Statement Exhibit Cto this Agreement, executed by the City and approved by the City’s counsel (“”), (y) the provisions of Sections 17.6.1, and 17.6.3of the DDA and Section 5(c)of this Agreement will apply with respect to delivery by the City of notice to Lender of any default by Borrower or any other party under the DDA and (z) subject to the provisions of Section 5(c)of this Agreement governing the Permitted Mortgagee to which City shall be obligated to deliver notice, Lender shall be entitled to the “Notice to Mortgagee” as provided in Section 17.6.3of the DDA in accordance with the terms thereof. (b)Lender enters into this Agreement with the understanding that Lender’s rights as a Permitted Mortgagee under the DDA are subject to the terms and conditions set forth in the DDA and this Agreement, including without limitation thefollowing: (i) the City’s right to the City Lien as referred to in Section 16.2of the DDA; (ii)the City’s Right of Repurchase referred to in Section 16.3of the DDA; (iii) the City’s Right of Reversion referred to in Section 16.4of the DDA; and (iv)the prohibition of Mezzanine Financing by Lender without the prior written consent of the City in its sole discretion. (c)Lender acknowledges and agrees (1) to be bound by and comply with those provisions of Section 16.3of the DDA that apply Permitted Mortgagees, and (2) in accordance with Section 16.3.5of the DDA, upon the exercise by the City of the Right of Repurchase in accordance with the requirements of the DDA, payment to Lender by City of the Repurchase Price for the Reacquired Property at the close ofescrow for such Reacquired Property, if any, Lender will reconvey from Lender’s Security Documents the portion of the Mortgaged Property reacquired by the City, and (3) subject to Lender having received payment of the Repurchase Price due, if any, in the event of such exercise of the Right of Repurchase by the City, to execute acknowledge and deliver all documents reasonably necessary or appropriate to release Lender’s Security Documents in the Mortgaged Property reacquired by the City, at no additional cost or charge to City. (d)Lender further acknowledges and agrees: (1) to be bound by and comply with those provisions of Section 16.4of the DDA applicable to Permitted Mortgagees; (2) in accordance with Section 16.4.6of the DDA, in the event of the exerciseby the City of the Right of Reversion and payment to Lender in accordance with Section 16.4.3(c)of the DDA, that the portion of the Mortgaged Property reacquired by Tustin Cornerstone I DDA Att 24 FORM ATTACHMENT 24City of Tustin/Flight Venture Subordination Agt 06-12-2017.docx7 the City will be free and clear of Lender’s Security Documents, (3) in the event of such exercise of the Right of Reversion by the City in accordance with the requirements of the DDA, to execute acknowledge and deliver all documents reasonably necessary or appropriate to release Lender’s Security Documents, all at no additional cost or charge to City, (4) Lender is not relying on City for any purposes, except for compliance with City’s obligations expressly set forth in this Agreement, the DDA and/or the Property Documents, including without limitation, the City’s obligations to the Lender set forth or referred to in this Agreement, or to Lender asPermitted Mortgagee under the DDA and/or the Property Documents, (5) the City does not have, and shall not have, any fiduciary duties to the Lender (including any fiduciary duties relating to the City’s administration and enforcement of the DDAand/or the Property Documents), and (6) the City does not have, and shall not have, any express or implied duties to the Lender other than the City’s duties and obligations expressly set forth in this Agreement,the DDA, and/or the Property Documents. (e)The City shall deliver to the Lender as specified in Section 5(c)of this Agreement, a copy of each City Notice, in each case within five (5) business days after the City’s delivery of such notice to Borrower or Guarantor, as applicable; provided that the provisions of Sections 17.6.1, and 17.6.3of the DDA shall apply with respect to such notice and each such notice to Lender shall be delivered in accordance with the provisions of this Agreement, including the provisions of Section 5(c)regarding the Lender to which such notice shall be delivered. Notwithstanding any other provision of this Agreement, the Cityshall not pursuant to the Property Documents, by any Enforcement Action or by entering into this Agreement, assume any obligations of the Borrower under the Loan Documents or be obligated to comply with any of the terms of any of the Loan Documents. The City shall have the right, but not the obligation, to cure any Loan Defaults pursuant to and in accordance with Article 4below. (f)The Loan Documents require that the Equity Completion Date (as confirmed by the City in a City Statement containing Section 2from the form attached as Exhibit C) shall have occurred ) before Lender disburses any funds to Borrower (other than any nominal amount (i.e., less than $25,000 funded by Lender at closing and except for any protective advances made by Lender to protect its security under the Loan Documents, and any interest accruing on the foregoing that is paid for by the proceeds of the Loan) and Lender agrees for the benefit of the City: (i)to be bound by and comply with that requirement and (ii)that any such nominal amounts or protective advances funded by Lender shall not advance the occurrence of the Equity Completion Dateor modify in any manner the rights of the City set forth in the DDA and the Property Documents that arise prior to the Equity Completion Date (as confirmed by the City in a City Statement containing Section 2from the form attached as Exhibit C), includingwithout limitation the right of the City to exercise the Right of Repurchase and/or the Right of Reversion under the DDA. (g)Lender hereby acknowledges and agrees that the provisions of Section 16.4.3(a) through (e))of the DDA shall apply regardless of the amount or timing of disbursements made by Lender under the Loan or the total amount of Indebtedness then outstanding. (h)WITH RESPECT TO THE AMOUNTS PAYABLE TO LENDER AS SET FORTH IN SECTIONS 2(c)AND2(d)ABOVE, LENDER ACKNOWLEDGES AND AGREES THAT SUCH AMOUNT BEARS A REASONABLERELATIONSHIP TO THEDAMAGES WHICH THE PARTIES ESTIMATE MAYBE SUFFERED BY THE CITY, WHICH DAMAGES WOULD BE IMPRACTICAL OR EXTREMELY DIFFICULT TO QUANTIFY, THAT SUCH AMOUNT CONSTITUTES A REASONABLE ESTIMATE OF THECITY’S DAMAGES IN SUCHEVENT, AND THAT THE REMEDY PROVIDED FOR IN THE DDA AND THIS AGREEMENT IS NOT A PENALTY OR FORFEITURE AND ISA REASONABLE LIMITATION ON POTENTIAL LIABILITY. LENDER AGREES THAT THE FOREGOING STATEMENTS ARETRUE. LENDER FURTHER AGREES THAT THE PAYMENT BY THECITY TO LENDER OF THE AMOUNTS SPECIFIEDIN SECTION 2(c)ABOVEWILL,ON PAYMENT TO LENDERIN ACCORDANCE WITH SECTION 16.3OF THE DDA,CONSTITUTEFULL SATISFACTION OFALL AMOUNTS DUE FROM CITY TO LENDER Tustin Cornerstone I DDA Att 24 FORM ATTACHMENT 24City of Tustin/Flight Venture Subordination Agt 06-12-2017.docx8 (WITHOUT LIMITING LENDER’S RIGHTS AGAINST ANY OTHER PERSON, INCLUDING, WITHOUT LIMITATION, BORROWER AND ANY GUARANTOR UNDER THE LOAN DOCUMENTS), AND THATUPON PAYMENT OF SUCH SUMS TO LENDER, LENDER SHALL COOPERATE WITH CITY,AND TAKE ALL ACTIONS, TO RELEASE THE SECURITY INSTRUMENT AND THE LIEN OF THE PERMITTED MORTGAGE FROM THE PROPERTY REACQUIRED BY THE CITY PURSUANT TO SECTION 16.3OF THE DDA.LENDER FURTHER AGREES THAT THE PAYMENT BY THE CITY TO LENDER OF THE AMOUNTSSPECIFIED IN SECTION 2(d)ABOVE OR INTERPLEADER OF ANY SUMS TO A COURT OF LAW AS SET FORTH IN SECTIONS16.4.3(d)AND16.4.3(e)OF THE DDA WILLCONSTITUTEFULL SATISFACTION OF ALL AMOUNTS DUE FROM CITY TO LENDER (WITHOUT LIMITING LENDER’S RIGHTS AGAINST ANY OTHER PERSON, INCLUDING, WITHOUT LIMITATION, BORROWER AND ANY GUARANTOR UNDER THE LOAN DOCUMENTS), AND THAT UPON PAYMENT OF SUCH SUMS TO LENDER, LENDER SHALL COOPERATE WITH CITY, AND TAKE ALL ACTIONS, TO RELEASE THE SECURITYINSTRUMENT AND THE LIEN OF THE PERMITTED MORTGAGE FROM THE PROPERTY REACQUIRED BY THE CITYPURSUANT TO SECTION 16.4OF THE DDA. 3.SUBORDINATION AND OTHER AGREEMENTS. (a)Lender hereby agrees, acknowledges and confirms that the Security Instrument is subordinate to the terms, covenants, conditions, operations, and effects of each of the Property Documents. (b)Lender expressly acknowledges and specifically confirms that the Security Instrument is subordinate to the DDA, including, but not limited to, all of the following specific provisions of the DDA, in each case subject to the terms of this Agreement and Lender’s rights under the DDAas a Permitted Mortgagee: (i)The rights of the City under the DDA with respect to the City Lien as set forth in Section 16.2of the DDA, the Right of Repurchase in favor of the City as set forth in Section 16.3 of the DDA (provided that with respect to closing under such Right of Repurchase, any payment due to Lender as Repurchase Price is so paid to Lender at the close of escrow), and the Right of Reversion in favor of the City, as set forth in Section 16.4of the DDA (provided that with respect to closing under such Right of Reversion, any payment due to Lender under Section 16.4.3(c)of the DDA is paid to Lender at the close of escrow for the Reversion Event); (ii)The rights of the City in Articles 2,8,16and 17and Section 4.6of theDDA; and (iii)Any other provisions of the DDA or any of the attachments to the DDA required to interpret Articles 2,8,16or 17or Section 4.6of the DDA. The Lender shall have the authority to act under the DDAas the Permitted Mortgagee under the DDA and the City shall be entitledto rely on the authority of the Lender for all such purposes. The foregoing shall be true even if the Lender is acting as agent or lead lender pursuant to a participation agreement, agency agreement, intercreditor agreement or comparable arrangement.Without limiting any of the City’s rights under the DDA, where the Lender under this Agreement is comprised of more than one Person and if the Lender has not, either in the Security Instrument or by written notice to the City, authorized an agent to act on behalf of the Lender parties for matters relating to the DDA,, then in no event shall the City have any obligation to take any act as a result of a demand by Lender unless such demand shall be executed by each of the Persons comprising Lender under this Agreement (whether in the same instrument or in counterparts), and until such time as the City receives a demand executed by each of the Persons Tustin Cornerstone I DDA Att 24 FORM ATTACHMENT 24City of Tustin/Flight Venture Subordination Agt 06-12-2017.docx9 comprising Lender under this Agreement (whether in the same instrument or in counterparts), the City shall have the absolute right to take no action with respect to or as a result of such demand and such inaction with respect to or as a result of such demand shall not be a breach or default by City of its obligations under this Agreement, the DDA, the Property Documentsor any other agreement binding on City and Borrower or Lender or any Affiliate thereof. (c)The foregoing subordinations in Sections 3(a)and 3(b)shall apply and continue notwithstanding (i)the actual date and time of execution, delivery, recording, filingor perfection of each of the Loan Documents and each of the Property Documents, and (ii)the respective rights of the Lender and the City to obtain a security interest in any collateral, including any collateral other than the Mortgaged Property. (d)[[750,926,800,979][11][,I,][Times New Roman]][ [[766,926,925,979][11][,I,][Times New Roman]]Intenti [[888,926,1189,979][11][,I,][Times New Roman]]onally Omitted [[1162,926,1212,979][11][,I,][Times New Roman]]. [[1168,926,1222,979][11][,I,][Times New Roman]]] (e)Notwithstanding the foregoing, so long as the City has not acquired the Parcel pursuant to its Right of Reversion or the Right of Repurchase, the Rents, issues and profits from the Mortgaged Property, and the Loss Proceeds payable with respect thereto, are expressly subject to the rights and claims of the Lender under the Loan Documents and may be used by Borrower (subject to the terms of the Loan Documents), or by Lender. From and after the acquisition of a portion of the Parcel and any Improvements thereon by the City pursuant to a Right of Repurchase or Right of Reversion, all Rents, issues and profits from such Reacquired Property, and Loss Proceeds, thereafter payable with respect thereto shall be owned by the City and Lender hereby relinquishes all rights and claims thereto, if any. (f)The City represents and warrants to the Lender as follows as of the date of this Agreement: (i) to the actual knowledge of the City Manager, after consultation by the City Manager with the City Director of Finance or such other individualemployed by the City that the City Manager in good faith believes to be best informed as to such matter (and without any other duty of inquiry), the Property Documents are in full force and effect; (ii)the Property Documents have not been modified or amended from the executed copies of the Property Documents delivered by the City to Escrow concurrently with the [[300,1817,350,1870][11][,I,][Times New Roman]][ [[316,1817,490,1870][11][,I,][Times New Roman]]Phase 1 [[464,1817,514,1870][11][,,][Times New Roman]]/ [[475,1817,649,1870][11][,I,][Times New Roman]]Phase 2 [[617,1817,671,1870][11][,I,][Times New Roman]]] [[651,1817,1248,1870][11][,,][Times New Roman]]Property Close of Escrow; (iii) [[1225,1817,1978,1870][11][,,][Times New Roman]]the City has not delivered to Borrower [[1939,1817,2224,1870][11][,,][Times New Roman]]or Guarantor [[2184,1817,2299,1870][11][,,][Times New Roman]]any City Notice;. (g)Each Person comprising Lender represents and warrants to the City as follows as of the date of this Agreement: (i)the list of Loan Documents attached hereto as Exhibit Bis a true, correct and complete list of all Loan Documents and that such documents have not been modified or amended in any manner from the Loan Documents provided to and approved by the City, except in the manner provided by Section 17.3of the DDA and approved by the City as and if required thereby; (ii) to the actual knowledge of [[349,2236,1408,2288][11][B,I,][Times New Roman]][insert as applicable: Loan Officer or Asset Manager] [[1386,2236,1474,2289][11][,,][Times New Roman]]of [[1437,2236,1571,2289][11][,,][Times New Roman]]each [[1533,2236,2023,2289][11][,,][Times New Roman]]such Person comprising [[1986,2236,2301,2289][11][,,][Times New Roman]]Lender for the Loan, after consultation with such other individualemployed by such Person comprising Lender that such [[298,2341,956,2393][11][B,I,][Times New Roman]][Loan Officer or Asset Manager] [[932,2341,1314,2394][11][,,][Times New Roman]]in good faith believ [[1287,2341,2300,2394][11][,,][Times New Roman]]es to be best informed as to such matter (and without any other duty of inquiry), the Loan Documents are in full force and effect; and (iv)that the Lender has not delivered to Borrower any written notice of the existence of a Loan Default. Each Person comprising Lender further represents and warrants to the City as follows as of the date of this Agreement (and if more than one Person comprises Lender, such representation and warranty is made by each such Person as to itself only and not as to any other Person): such Lender, either directly or through its Affiliates, regularly engages in the business of making, owning or investing in commercial real estate construction loans similar in size and nature to the Loan (including mezzanine construction loans) or owning, developing and/or operating commercial properties similar in size and nature to the Project or applicable Phase thereof, and such Lender has total assets (inclusive of unfunded capital commitments), individually or with its parent entities and Affiliates, in excess of Six Hundred Fifty Million Dollars ($650,000,000.00). Tustin Cornerstone I DDA Att 24 FORM ATTACHMENT 24City of Tustin/Flight Venture Subordination Agt 06-12-2017.docx10 (h)Lender shall, within five (5) Business Days after the earlier of delivery of such notice to Borrower or any Loan Guarantor, including the Guarantor, deliver to the City (A) a copy of each notice of a Loan Default delivered to the Borrower by the Lender, and (B) a copy of each notice to Borrower or Guarantor that Guarantor fails to satisfy a Liquidity Covenant set forth in the Mortgage or that a Guarantor Illiquidity Event has occurred.For the avoidance of doubt, email correspondence shall not constitute notice required to be delivered to the City unless the Loan Documents provide that email correspondence constitutes valid notice to Borrower or Guarantor for the purposes of the Loan Documents. Notices pursuant to this Section 3(h)shall be given in the manner required in Section5(c)of this Agreement. Borrower agrees that Lender is authorized to deliver such notices to the City. Neither giving nor failing to give a notice to the Lenderor City pursuant to this Section 3(h)shall affect the validity of any notice given by the Lender or City to the Borrower or Guarantor, as between the Borrower or Guarantor, and the Lender or the City, as applicable. (i)Within ten (10) Business Days after request by the City, but not more often than (i) twice during any twelve (12) month period, or (ii) not more than once in any sixty (60) day period during the existence ofa Loan Default and/or a Property Document Breach, each Person comprising the Lender shall furnish the City with a statement, in the form of the document attached as ExhibitDto this Agreement Lender Statement (“”), duly executed by such Person(s) confirming the matters described therein, together with such modifications as are necessary in the Lender’s sole discretion to ensure the accuracy of the statements made therein. (j)Upon payment to the City by Borrower of theThree Thousand Dollar ($3,000) payment due for the requested City Statement pursuant to Section 2.2.6(c)of the DDA with respect to such requestand of any amounts due to City for the prior preparation of any City Statements that remain unpaid at the time such request is made (whether such amountsare paid by deduction from the City Costs Deposit or by direct payment), the City shall, at the times set forth in the following sentence, furnish the Lender with a City Statement, duly certified, confirming the matters specified in Exhibit C, together with such modifications as are necessary in the City’s sole discretion to ensure the accuracy of the statements made therein.The City shall provide Lender with the City Statement, concurrently with the [[1885,1770,2282,1823][11][,I,][Times New Roman]][Phase 1][Phase 2] Property Close of Escrow, and thereafter within ten (10) Business Days after request by Lender, but as to such requests not more often than (i) prior to the first funding of the Loan that occurs on or after the Equity Completion Date, (ii) not more than once in any ninety (90) day period, and (iii) in connection with a transfer of all or any portion of the Property by Lenderor any Lender Affiliate.In addition, the City shall have no obligation to issue any City Statement unless and until it has been paid in full for amounts outstanding due from prior preparation of City Statements that remain unpaid at the time the request for City Statement is made. (k)Lender agrees that it shall not enter into any written amendment, modification, waiver, extension, replacement or renewal of any of the Loan Documents that (a)would allow Borrower, prior to the Equity Completion Date (as confirmed by the City in a City Statement containing Section 2 from the form attached as Exhibit C), to obtain disbursements of Loan proceeds (other than any nominal amount (i.e., less than $25,000)funded by the Lender at closing and other than any protective advances made by Lender to protect its security under the Loan Documents, and any interest accruing on the foregoing that is paid for by the proceeds of the Loan), or (b) would authorize Borrower to use Loan proceeds for purposes other than those permitted in the Loan Documents delivered to the City on or before the Effective Date unless the Loan proceeds willbe used solely to finance the acquisition of the Property and/or construction of the Improvements and for associated costs and expenses that directly relate to the Project (including financing costs),in each case, without first obtaining the City’s prior written consent thereto, which may be granted or withheld in the City’s sole discretion. Lender acknowledges and agrees that in the event that Lender and Borrower enter into any amendment to the Loan Documents that reduces or eliminates the Liquidity Covenants set forth in the final Loan Documents originally approved by City Tustin Cornerstone I DDA Att 24 FORM ATTACHMENT 24City of Tustin/Flight Venture Subordination Agt 06-12-2017.docx11 pursuant to Section2of this Agreement or in the event that the Person(s) comprising the Loan Guarantor Minimum Liquidity Standards do not include the Guarantor, then City shall have the right to impose the “” defined in Section 4.7.4of the DDA upon the Guarantor and Borrower and to exercise its other rights and remedies with respect thereto in accordance with the terms set forth therein. Notwithstanding the foregoing or anything to the contrary contained in the DDA (including, without limitation, Section 17.3thereof), City and Lender agree that no amendment, modification, waiver, postponement, extension, replacement, renewal or termination of or to any of the Loan Documents shall, or shall be deemed or construed to, modify or limit the rights of City or Lender pursuant to the DDA and this Agreement(but without limiting the City’s rights or remedies against the Lender in the event of a breach of this Agreement by Lender and without limiting the Lender’s rights or remedies against the City in the event of a breach of this Agreement by the City). 4.DEFAULT UNDER PROPERTY DOCUMENTS AND LOAN DOCUMENTS. (a)In the event of a Property Document Breach, Lender: (i) shall have the right to cure such Property Document Breach in the manner and to the extent provided for in Section 17of the DDA and as may be provided under or in connection with any of the other Property Documents, as applicable, providing a Permitted Mortgagee with the right to so cure, and the City’s ability to commence any Enforcement Action shall be limited as and to the extent provided for in Sections17.6and 17.7of the DDA, (ii) shall not have any obligation to cure any Property Document Breach and (iii) as between Lender and the City only, Lender shall not be subrogated to the rights of the City under the Property Documents by reason of the Lender having cured any Property Document Breach, but as between Lender and any Person other than City, Lender shall be subrogatedto the rights of the City under the Property Documents by reason of Lender having cured any Property Document Breach.The City acknowledges that all amounts advanced or expended by the Lender in accordance with the Loan Documentsor to cure a Property Document Breach shall be added to and become a part of the Indebtedness under the Security Instrument and Loan Documents and shall be secured by thelien of the Security Instrument and other applicable Loan Documents; provided that the foregoing shall not limit the City’s rights in Section 2(c),2(d),2(f)and 2(g)of this Agreement and Sections 16.3and 16.4(including without limitation Section 16.4.3(c)) of the DDA. (b)Failure of the Lender to send notice to the City required by Section 3(h)shall not prevent the exercise of the Lender's rights and remedies under the Loan Documents, this Agreement, or the DDA; provided,however, that the Lender shall not complete a Foreclosure with respect to the Mortgaged Property until such time as it shall have provided the City with, as to any monetary Loan Default, the right, but not the obligation, to cure any monetary Loan Default for a period of thirty (30) calendar days following the date such notice is delivered to City by Lender and, as to any non-monetary default, the right, but not the obligation, to cure such non-monetary Loan Default for a period of ninety (90) calendar days following the date such notice is delivered to City by Lender; provided,however, that the Lender shall be entitled during such 30-day or 90-day (as applicable) period to continue to pursue its remedies under the Loan Documents short of completing a Foreclosure; provided further,however, that nothing in this Agreement shall prohibit Lender from completing a Foreclosure of the type described in clause (c)of the definition thereof.TheCity shall not be subrogated to the rights of the Lender under the Loan Documents by reason of the City having cured anyLoan Default[[1095,2452,1145,2505][11][,I,][Times New Roman]]. [[1120,2452,2300,2505][11][,,][Times New Roman]]However, the Lender acknowledges that all amounts paid by the City to the Lender to cure a Loan Default shall be deemed to have been advanced by the City pursuant to, and, subject to the limitation set forth in Section 2.2.2(h)(ii)of the DDA with respect to obligations of a Foreclosure Transferee to reimburse the City for certain attorneys’ fees incurred by the City, shall be secured by the City Lien and shall be prior to the lien of the Security Instrument and shall be appliedby Lenderto reduce the amount of principal and/or interest (as the case may be) so paid by the City to cure such Loan Default under the Permitted Mortgage; provided, that in no event shall Lender be required to cure, as a condition to protecting any of its rights under this Agreement, the DDA or the Loan Documents, the Default that arises under the DDA as a result of the City having funded such amounts. Tustin Cornerstone I DDA Att 24 FORM ATTACHMENT 24City of Tustin/Flight Venture Subordination Agt 06-12-2017.docx12 (c)Lender shall not be obligated to perform any of the Borrower’s obligations under the DDA to construct or complete anyImprovements or to guarantee such construction or completion thereof. Notwithstanding the foregoing, if any Person acquires title to any part of the Mortgaged Property or the Improvements as a result of a Foreclosure or from Lender (or a Lender Affiliate thereof) after a Foreclosure, then such Person or entity shall be subject to all of the Property Documents. If the Lender elects to construct any Improvements on the Mortgaged Property, the Lender (or a Lender Affiliate thereof) must first acquire title tothe Mortgaged Property and assume all of the obligations of Borrower under all of the Property Documents as and to the extent provided in Sections 2.2.2(h)and 2.2.2(i)of the DDA if the Transfer is made pursuant to one of such Sections, or in the event Lender elects a Transfer pursuant to Section 2.2.3of the DDA, the Transfer as shall be governed by the applicable provisions ofSection 2.2.3 of the DDA, and the Improvements may only be those Improvements that Borrower would be permitted to construct under the DDA and shall be subject to the terms and conditions of the DDA, specifically including but not limited to Article 8of the DDA; provided, however, nothing in the foregoing shall prevent the continuation of any construction work by a Qualified Receiver appointed with respect to the Mortgaged Property during any applicable period of such receivership. In all events, Lender (or a Lender Affiliate thereof) shall only be liable to the City under the DDA after the date of a Foreclosure to the extent of Lender’s (or Lender Affiliate’s) interest (whether fee or leasehold) in the portion of Mortgaged Property and the Improvements thereon owned by Lender (or Lender Affiliate thereof); provided that such limitation shall not apply to any other Foreclosure Transferee or other Person who acquires title to any part of the Mortgaged Property or the Improvements from Lender after a Foreclosure. Notwithstanding anything to the contrary contained herein or in the DDA, in no event shall the Lender (or any Lender Affiliate thereof) be required to post any replacement Guaranty upon acquiring title to the Mortgaged Property, nor during any period when a Qualified Receiver has been appointed for the Mortgaged Property, regardless of Lender’s, such Lender Affiliate’s or such Qualified Receiver’s election to construct or cause the construction of any Improvements on the Mortgaged Property, and in no event shall any default under or in connection with the Guaranty in place at the time of Foreclosure result in a default under the DDA during the period of Lender’s or its Lender Affiliate’s ownership of the Mortgaged Property (nor after any sale of the Mortgage Property by Lender or its Lender Affiliate to a Qualified Foreclosure Purchaser that is made in compliance with the requirements of the DDA).The provisions of this Section 4(c)shall survive the termination of this Agreement and, for avoidance of doubt, shall survive any Foreclosure. (d)[[750,1930,800,1983][11][,I,][Times New Roman]][ [[766,1930,1189,1983][11][,I,][Times New Roman]]Intentionally Omitted [[1161,1930,1211,1983][11][,,][Times New Roman]]. [[1168,1930,1222,1983][11][ ,I,][Times New Roman]]] (e)Lender may under all circumstances pursue all rights and remedies against Borrower, any Loan Guarantor, and any other Person available to it under the Loan Documents, at law, or in equity, regardless of any City Notice or Enforcement Action by the City; provided that, subject to Lender’s rights under the DDA and this Agreement, the foregoing shall not limit the rights of the City set forth in the DDA or this Agreement with respect to such City Notice or Enforcement Action or otherwise during the pendency of Lender’s pursuit of its rights and remedies. No action or failure toact on the part of the Lender in the event of a Property Document Breach or commencement of an Enforcement Action shall constitute a waiver on the part of the Lender vis-à-vis Borrower, any Loan Guarantor, and any other Person of any provision of the LoanDocuments or this Agreement. (f)Notwithstanding anything to the contrary in the Loan Documents, this Agreement or in the DDA, if the City consummates its Right of Reversion or its Right of Repurchase and the Security Documents arenot released as required by(and on and subject to) the terms and conditions of this Agreement, then Lender shall not, without the prior written consent of the City in its sole discretion, consummate any Foreclosure. Tustin Cornerstone I DDA Att 24 FORM ATTACHMENT 24City of Tustin/Flight Venture Subordination Agt 06-12-2017.docx13 5.MISCELLANEOUS PROVISIONS. (a)In the event of any direct conflict orinconsistency between the terms of the Property Documents and the terms of this Agreement, the terms of this Agreement shall control. In the event of any direct conflict or inconsistency between the terms of the DDA and this Agreement, the terms of this Agreement shall prevail, provided however all terms and conditions of the DDA not specifically and explicitly modified herein shall continue to apply and to be of full force and effect without modification. (b)This Agreement shall be binding upon and shall inure to the benefit of the respective legal successors and assigns of the parties hereto. No other party shall be entitled to any benefits hereunder, whether as a third-party beneficiary or otherwise. (c)Each notice, request, demand, consent, approval or other communication noticesnotice (collectively, “,” and singly, a “”) which is required or permitted to be given pursuant to this Agreement shall be in writing and shall be deemed to have been duly and sufficiently given if (i) personally delivered with proof ofdelivery thereof (any notice so delivered shall be deemed to have been received at the time so delivered), or (ii) sent by a national overnight courier service (such as FedEx) designating earliest available delivery (any notice so delivered shall be deemed to have been received on the next business day following receipt by the courier), or (iii) sent by United States registered or certified mail, return receipt requested, postage prepaid, at a post office regularly maintained by the United States Postal Service (any notice so sent shall be deemed to have been received on the date of delivery as confirmed by the return receipt), addressed to the respective parties as follows: Notices intended for the Lender shall be addressed to: If to Lender: With a copyto: With a copy to: With a copy to: Notices intended for the City shall be addressed to: If to the City:Tustin City Hall 300 Centennial Way Tustin, CA 92780 Attention: City Manager Facsimile: (714) 838-1602 Tustin Cornerstone I DDA Att 24 FORM ATTACHMENT 24City of Tustin/Flight Venture Subordination Agt 06-12-2017.docx14 With a copy to:City of Tustin City Attorney Woodruff Spradlin & Smart 555 Anton Boulevard, Suite 1200 Costa Mesa, California 92626 Attn: David E. Kendig Facsimile: (714) 835-7787 Email: dkendig@wss-law.com Any party, by written notice given pursuant to this Section5(c), may change the person or persons and/or address or addresses, or designate an additional person or persons or an additional address or addresses, for its notices, but notice of a change of address shall only be effective upon receipt.Notwithstanding any other provision of this Agreement to the contrary, City shall be entitled to deliver the Notice to Mortgagee and any other notice required to be delivered by City to any Permitted Mortgagee under this Agreement, the DDA and/or the Property Documents to the address for such Permitted Mortgagee contained in the Permitted Mortgage (as amended) last Recorded, and no change to the name or address of any Permitted Mortgagee shall be deemed effective or binding on the City unless it is contained in a Recorded Permitted Mortgage (as amended) or Recorded assignment thereof or other document Recorded against the Parcel encumbered by the Permitted Mortgage, with a copy delivered to the City Clerk and to the City in accordance with Section 5(c)of this Agreement. Neither party shall refuse or reject delivery of any notice given in accordance with this Section5(c). (d)Nothing herein or in any of the Loan Documents or Property Documents shall be deemed to constitute the Lender as a joint venturer or partner of the City. (e)This Agreement shall be governed by the laws of the State of California, irrespective of California’s choice-of-law principles. (f)The parties agree to submit to personal jurisdiction in the State of California in any action or proceeding arising out of this Agreement. The parties hereby agree and consent that without limiting other methods of obtaining jurisdiction, personal jurisdiction over the parties in any such action or proceeding may be obtained within or without the jurisdiction of any court located in California and that any process or notice of motion or other application to any such court in connection with any such action or proceeding may be served upon the parties by registered or certified mail to or by personal service at the last known address of the parties, whethersuch address be within or without the jurisdiction of any such court. Any legal suit, action or other proceeding by one Party to this Agreement against the other arising out of or relating to this Agreement shall be instituted only in the courts of the State of California, County of Orange or the United States District Court for the Central District of California, and each Party hereby waives any objections which it may now or hereafter have based on venue and/or forum non-conveniens of any such suit, action or proceeding and submits to the jurisdiction of such courts. (g)To the extent permitted by law, each of Borrower, Lender and the City waives its respective rights to a trial by jury of any claim or cause of action based on, arising from, or related to or arising out of this Agreement, in any action, proceeding, or other litigation of any type brought by either party against the other, whether with respect to any cause of action in law or equity. Borrower, Lender and the City agree that any such claim or cause of action shall be tried by a court trial without a jury. Without limiting the foregoing, the parties further agree that their respective right to a trial by jury is waived by operation of this section as to any action, claim, counter-claim, or other proceeding that seeks, in whole or in part, to challenge the validity or enforceability of this Agreement. This waiver shall apply to any future amendments, renewals, supplements, or modifications to this Agreement. Tustin Cornerstone I DDA Att 24 FORM ATTACHMENT 24City of Tustin/Flight Venture Subordination Agt 06-12-2017.docx15 (h)If any Party to this Agreement institutes any action, suit, counterclaim or other Action proceeding for any relief against another Party, declaratory or 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 Party to this Agreement, then the Prevailing Party in such Action shall be entitled to have and recover of and from the non-Prevailing Party all costs and expenses of the Action, including (a)the Prevailing Party’s reasonable attorneys’ fees which, regardless of which Party is the Prevailing Party, shall be payable at the actual contractual hourly rate for City’s litigation counsel at the time the fees were incurred, but in no event more than $200.00 per hour and (b)costs actually incurred in bringing and Decision prosecuting such 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, Costs including reasonable attorneys' fees and expert fees and 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: (a)post judgment motions and collection actions; (b)contempt proceedings; (c)garnishment, levy, debtor and third party examinations; (d)discovery; (e) any bankruptcy, reorganization, insolvency, composition, restructuring, dissolution, liquidation, receivership, assignment for the benefit of creditors, or custodianship action or proceeding under any federalor state law with respect to the Borrower, any Loan Guarantor of any of the Indebtedness, any of their respective properties, or any of their respective partners, members, officers, directors, or Prevailing Party shareholders; and (f)appeals of any order or judgment. “” within the meaning of this Section5(h)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. The provisions of this Section5(h)shall survive the expiration or termination of this Agreement. (i)If any one or more of the provisions contained in this Agreement, or any application thereof, shall be invalid, illegal orunenforceable in any respect, the validity, legality and enforceability of the remaining provisions contained herein, and any other application thereof, shall not in any way be affected or impaired thereby. (j)The term of this Agreement shall commence on thedate hereof[[1885,2033,1936,2085][11][B,I,][Times New Roman]], [[1906,2033,2300,2086][11][,,][Times New Roman]]and shall terminate (except for provisions that expressly state that they survive any expiration or termination of this Agreement, which shall remain in effect) only upon the earliest to occur of the following events: (i) the payment of all of the Indebtedness and the release of the Security Instrument (it being agreed that in no event shall the Indebtedness be deemed to have been repaid in connection with the completion of a Foreclosure, regardless as to the amount bid by Lender, unless Lender receives payment in cash in full of the Indebtedness from a third party,not including any Affiliate of Lender,in connection with such Foreclosure); (ii) the completion of a Foreclosure, (iii) Lender receipt following the close of escrow of the amounts to which it is entitled following exercise of the Right of Repurchase by the City as provided in Section 16.3of the DDA or the amounts to which Lender is entitled following exercise of the Right of Reversion by the City as provided in Section 16.4of the DDA; (iv)issuance by the City of a Certificate of Compliance in accordance with Section 9of the DDA with respect to all portions of the Parcel secured by the Security Instrument, or (v) the termination of the DDA; provided that (1) in the event of a termination under clause (i)above, then following such termination if any payment on account of the Indebtedness is avoided, set aside, rescinded or repaid by the Lender due to order of any bankruptcy court or any other applicable court (and provided that none of the events described in clauses (iii),(iv),or (v)has then occurred), this Agreement shall be reinstated and shall remain in effect until the earlier of (A) the satisfaction of clause (i)above with respect to such reinstated Indebtedness or (B) thetermination of this Agreement as a result of the occurrence of Tustin Cornerstone I DDA Att 24 FORM ATTACHMENT 24City of Tustin/Flight Venture Subordination Agt 06-12-2017.docx16 any one of the events in clauses(iii),(iv),or (v)above, and (2) no termination of this Agreement shall terminate any party’s rights or liability with respect to breaches or defaults under this Agreement occurring prior to such termination. (k)No failure or delay on the part of any party hereto in exercising any right, power or remedy hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such right, poweror remedy preclude any other or further exercise thereof or the exercise of any other right, power or remedy hereunder. (l)Except for any limitations expressly provided in this Agreement, the DDA or the other Property Documents, each party hereto acknowledges that in the event any party fails to comply with its obligations hereunder, the other parties shall have all rights available at law and in equity, including the right to obtain specific performance of the obligations of such defaulting party and injunctive relief. (m)Nothing in this Agreement is intended, nor shall it be construed, to in any way limit the exercise by the City of its governmental powers (including but not limited to police, regulatory and taxing powers) with respect to the Borrower or the Mortgaged Property to the same extent as if it were not a party to this Agreement or the transactions contemplated hereby. (n)This Agreement may be amended, changed, modified, altered or terminated only by a written instrument or written instruments signed by the parties of this Agreement. (o)This Agreement may be executed in two or more counterparts, each of which shall be deemed an original but all of which together shall constitute one and the same instrument. [[800,1601,850,1654][11][,I,][Times New Roman]][ [[818,1601,1753,1654][11][,I,][Times New Roman]]Signature and Acknowledgement Pages to Follow [[1728,1601,1782,1654][11][,I,][Times New Roman]]] Tustin Cornerstone I DDA Att 24 FORM ATTACHMENT 24City of Tustin/Flight Venture Subordination Agt 06-12-2017.docx17 IN WITNESS WHEREOF , the parties have duly executed this Agreement as of the day and year first above written. LENDER: By: __________________________________ Name: Title: CITY: CITY OF TUSTIN : Dated: _______________________By: __________________________________ Jeffrey C. Parker, City Manager ATTEST: _________________________________ Erica N. Rabe, City Clerk APPROVED AS TO FORM: By: ______________________________ David Kendig, City Attorney Armbruster Goldsmith & Delvac LLP Tustin Special Real Estate Counsel By: ______________________________ Amy E. Freilich Tustin Cornerstone I DDA Att 24 FORM ATTACHMENT 24City of Tustin/Flight Venture Subordination Agt 06-12-2017.docxS-1 CONSENT OF BORROWER The Borrower hereby acknowledges receipt of a copy of this Tustin Cornerstone I Subordination Agreement ([[532,455,582,508][11][,I,][Times New Roman]][ [[548,455,886,508][11][,I,][Times New Roman]]Phase 1/Phase 2 [[854,455,908,508][11][,I,][Times New Roman]]] [[877,455,1398,508][11][,,][Times New Roman]]), dated as of___________ [[1372,455,2300,508][11][,,][Times New Roman]], 201_, by and between _____________and the City of Tustin, California, and consents to the agreement of the parties set forth herein and further consents to the waiver of jury trial provisions set forth in Section 5(g)of this Agreement. Borrower agrees that Lender is authorized to deliver to the City all notices and other information required or permitted to be delivered by Lender under this Agreement or any of the Property Documents. Notwithstanding Borrower’s execution of this Consent of Borrower (and notwithstanding any provisions of this Agreement to the contrary), Borrower is not a third party beneficiary of this Agreement, Borrower’s consent shall not be required for any amendment of this Agreement by and between Lender and the City, and as between Borrower and Lender, nothing contained in this Agreement shall modify, amend or limit Lender’s rights and remedies under the Loan Documents. [[1200,1135,1778,1187][11][B,I,][Times New Roman]]{INSERT BORROWER ENT [[1754,1135,1881,1187][11][B,I,][Times New Roman]]ITY} By:__________________________ Name: Title: Date: Tustin Cornerstone I DDA Att 24 FORM ATTACHMENT 24City of Tustin/Flight Venture Subordination Agt 06-12-2017.docxS-2 ACKNOWLEDGMENT A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. State of California) County of ______________________) On _________________________, before me, , (insert name of notary) Notary Public, 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(Seal) Tustin Cornerstone I DDA Att 24 FORM ATTACHMENT 24City of Tustin/Flight Venture Subordination Agt 06-12-2017.docxS-3 ACKNOWLEDGMENT A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. State of California) County of ______________________) On _________________________, before me, , (insert name of notary) Notary Public, 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(Seal) Tustin Cornerstone I DDA Att 24 FORM ATTACHMENT 24City of Tustin /Flight Venture Subordination Agt 06-12-2017.docxS-4 ACKNOWLEDGMENT A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. State of California) County of ______________________) On _________________________, before me, , (insert name of notary) Notary Public, 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(Seal) Tustin Cornerstone I DDA Att 24 FORM ATTACHMENT 24City of Tustin /Flight Venture Subordination Agt 06-12-2017.docxS-5 EXHIBIT A LEGAL DESCRIPTION OF PARCEL (legal description to include specific exclusions for oil, water, and other rights reserved by the City under the applicable Quitclaim Deed) [To Be Inserted] Tustin Cornerstone I DDA Att 24 FORM ATTACHMENT 24City of Tustin/Flight Venture Subordination Agt 06-12-2017.docxEXHIBIT A 1 EXHIBIT B LIST OF LOAN DOCUMENTS Tustin Cornerstone I DDA Att 24 FORM ATTACHMENT 24City of Tustin/Flight Venture Subordination Agt 06-12-2017.docxEXHIBIT B 1 EXHIBIT C FORM OF CITY STATEMENT ________________, 20__ [[300,771,350,824][11][,I,][Times New Roman]][ [[318,771,952,824][11][,I,][Times New Roman]]Transferee/Permitted Mortgagee [[918,771,972,824][11][,I,][Times New Roman]]] _________________ _________________ Attn: ____________ Re:Tustin Legacy Cornerstone I Ladies and Gentlemen: Permitted Mortgagee The undersigned is writing this letter to you (“”) regarding that certain office Project project (“”) that [[739,1323,789,1376][11][,I,][Times New Roman]][ [[757,1323,944,1376][11][,I,][Times New Roman]]has been [[912,1323,966,1376][11][,I,][Times New Roman]]] [[944,1323,994,1376][11][,I ,][Times New Roman]][ [[963,1323,1122,1376][11][,I,][Times New Roman]]may be [[1087,1323,1141,1376][11][,I,][Times New Roman]]] [[1119,1323,2300,1376][11][,,][Times New Roman]]constructed pursuant to the terms of that certain Subordination Agreement by and between the City of Tustin, a municipal corporation of the State of California (the City “”) and ___________________, the [[1129,1428,1179,1481][11][,I,][Times New Roman]][ [[1142,1428,1694,1481][11][,I,][Times New Roman]]predecessor in interest to [[1662,1428,1716,1481][11][,I,][Times New Roman]]] [[1715,1428,2301,1481][11][,,][Times New Roman]]Permitted Mortgagee dated Subordination ________________, 20__ and recorded against the Parcel in the Official Records (“ Agreement ”) on the Parcel. All initially capitalized terms used and not defined herein shall have the meanings set forth in the Subordination Agreement. OriginalDeveloper The City and Flight Venture LLC, a Delaware limited liability company (“”) entered into that certain Tustin Legacy Disposition and Development Agreement Cornerstone I dated as of November 15, 2016 as amended by that certain First Amendment to Tustin Legacy Disposition and DDA Development Agreement Cornerstone I dated as of ____, 2017 (the “”), relating to the conveyance from the City to Original Developer or its successor of among other things, the Parcel. _________, a DeveloperBorrower _________ (“” or “”) is the successor-in-interest to the Original Developer with respectto the Parcel under the DDA. The City has executed that certain Declaration of Special Restrictions for [[1890,2108,2301,2160][11][B,I,][Times New Roman]]{insert appropriate [[300,2161,1335,2213][11][B,I,][Times New Roman]]document for the Phase covered by this Statement: [[1298,2161,1501,2214][11][,I,][Times New Roman]]Phase 1 [[1465,2161,1843,2213][11][B,I,][Times New Roman]][Add correct title] [[1823,2161,2300,2214][11][,I,][Times New Roman]]dated _____________, [[300,2213,920,2266][11][,I,][Times New Roman]]recorded in the Official Records [[898,2213,2018,2266][11][,I,][Times New Roman]]against title to the Development Parcels on _____________ [[2002,2213,2300,2266][11][,I,][Times New Roman]]as Instrument [[298,2266,687,2319][11][,I,][Times New Roman]]No. __________ or [[656,2266,1431,2318][11][B,I,][Times New Roman]]for a City Statement covering Phase 2: [[1391,2266,2301,2319][11][,I,][Times New Roman]]that certain Declaration of Special Restrictions [[292,2319,562,2372][11][,I,][Times New Roman]]for Phase 2 [[521,2319,892,2371][11][B,I,][Times New Roman]][Add correct title] [[857,2319,1760,2372][11][,I,][Times New Roman]], dated _____________, recorded in the Officia [[1733,2319,2301,2372][11][,I,][Times New Roman]]l Records against title to the Special Restrictions [[298,2372,1087,2425][11][,I,][Times New Roman]]Development Parcels on _____________ [[1072,2372,1690,2425][11][,I,][Times New Roman]]as Instrument No. __________} [[1670,2372,1802,2425][11][,,][Time s New Roman]](the “ [[2158,2372,2255,2425][11][,,][Times New Roman]]”), Tustin Cornerstone I DDA Att 24 FORM ATTACHMENT 24City of Tustin/Flight Venture LLC Subordination Agt 06-12-2017.docxExhibit “C” 1 which include, among other matters, certain requirements regarding the use and maintenance of the Parcel and set forth those provisions of the DDA that survive the issuance of a Certificate of Compliance with respect to the Project. The City has executed that certain [[1146,507,1306,559][11][B,I,][Times New Roman]]{insert [[1290,507,2300,559][11][B,I,][Times New Roman]]appropriate document for Phase covered by this [[300,560,531,612][11][B,I,][Times New Roman]]statement: [[517,560,1563,613][11][,I,][Times New Roman]]Quitclaim Deed for Cornerstone I and Covenants, C [[1543,560,2300,613][11][,I,][Times New Roman]]onditions and Restrictions, Including [[298,613,2300,666][11][,I,][Times New Roman]]Environmental Restriction Pursuant to Civil Code Section 1471 dated _____________, recorded in the [[300,665,1890,718][11][,I,][Times New Roman]]Official Records against title to the Development Parcels on _____________ [[1890,665,2300,718][11][,I,][Times New Roman]]as Instrument No. [[299,718,579,771][11][,I,][Times New Roman]]__________ [[539,718,629,770][11][B,I,][Times New Roman]]or [[589,718,827,771][11][,I,][Times New Roman]]that certain [[810,718,2300,771][11][,I,][Times New Roman]]Quitclaim Deed for Cornerstone I and Covenants, Conditions and Restrictions, [[298,771,2300,824][11][,I,][Times New Roman]]Including Environmental Restriction Pursuant to Civil Code Section 1471, dated _____________, which [[300,824,1851,877][11][,I,][Times New Roman]]was recorded in the Official Records against title to the Parcel on __________ [[1823,824,2217,877][11][,I,][Times New Roman]]___ as Instrument [[2183,824,2299,877][11][,I,][Times New Roman]]No. Quitclaim Deed [[299,876,556,929][11][,I,][Times New Roman]]__________ [[525,876,579,929][11][,I,][Times New Roman]]} [[563,876,613,929][11][,,][Times New Roman]]( [[577,876,699,929][11][,,][Times New Roman]]the “ [[980,876,2300,929][11][,,][Times New Roman]]”) which Quitclaim Deed conveyed to Developer the fee title to the Parcel, subject to certain restrictions and limitations set forth in the Quitclaim Deed. Original Developer and the City executed that certain Development Agreement, dated as of December 15, 2016, recorded in the Official Records against title to the Development Parcels on March 30, DA 2017 as Instrument No. 2017000128365 (the“”). Developer and the City executed that certain Landscape Installation and Maintenance Agreement dated _______________, recorded in the Official Records against title to the Development Parcels on Landscape Agreement __________________ as Instrument No. _______________ (the“”), and that certain Roadway and Utility Easement dated ___________, recorded in the Official Records against title to Roadway the Development Parcels on _______________ as Instrument No.__________________ (the“ and Utility Easement ”). The DDA, the Memorandum of DDA, the Special Restrictions, the DA, the Quitclaim Deed the Landscape Agreement, the Roadway and Utility Easement, and any other agreements or instruments included within the definition of “Property Documents” in the Subordination Agreement, are collectively Property Documents referred to herein as the “”. By its execution of this letter, the City hereby confirms to you that: 1.As of the date of this letter, to the actual knowledge of the City Manager, after consultation by the City Manager with, as to each such confirmation, the City Director of Finance or such other individual employed by the City that the City Manager in good faith believes to be best informed as to such matter (and without any other duty of inquiry): (i)except as set forth on Attachment 1to this letter, the Property Documents are in full force and effect and have not been modified or amended [[1896,2283,2300,2336][11][,I,][Times New Roman]][since the previous [[748,2336,1695,2389][11][,I,][Times New Roman]]Lender Statement dated _____________, 20__ / [[1649,2336,2300,2389][11][,I,][Times New Roman]]from the executed copies of the [[748,2388,2300,2441][11][,I,][Times New Roman]]Property Documents delivered by the City to escrow concurrently with the date of [[750,2441,948,2494][11][,I,][Times New Roman]]delivery [[910,2441,1546,2494][11][,I,][Times New Roman]]of the Subordination Agreement] [[1515,2441,1565,2494][11][,,][Times New Roman]]; (ii)except as set forth on Attachment 2to this letter, the City has not delivered to Borrower or Guarantor any City Notice, and Attachment 2indicates whether the matters set forth in any such City Notice have been waived by City or cured to the City’s satisfaction; (iii)[[762,2805,812,2858][11][,I,][Times New Roman]][ [[780,2805,2300,2857][11][B,I,][Times New Roman]]TO BE INCLUDED ONLY IN THE CITY STATEMENT DELIVERED IN [[750,2858,2300,2910][11][B,I,][Times New Roman]]CONNECTION WITH THE PHASE 1/PHASE 2 PROPERTY CLOSE OF Tustin Cornerstone I DDA Att 24 FORM ATTACHMENT 24City of Tustin/Flight Venture LLC Subordination Agt 06-12-2017.docxExhibit “C” 2 [[749,300,1006,352][11][B,I,][Times New Roman]]ESCROW: [[970,300,1417,353][11][,I,][Times New Roman]]except as set forth on [[1376,300,1652,353][11][,I,][Times New Roman]]Attachment 2 [[1638,300,2300,353][11][,I,][Times New Roman]]to this letter, the entire Purchase [[748,352,1215,405][11][,I,][Times New Roman]]Price has been paid to [[1177,352,2301,405][11][,I,][Times New Roman]]the City and Borrower does not owe any other sums to the [[750,405,1437,458][11][,I,][Times New Roman]]City under the Property Documents [[1405,405,1455,458][11][,,][Times New Roman]]; [[1413,405,1467,457][11][B,I,][Times New Roman]]] (iv)[[748,508,800,560][11][B,I,][Times New Roman]][ [[766,508,2300,560][11][B,I,][Times New Roman]]TO BE INCLUDED ONLY IN THE CITY STATEMENT DELIVERED IN [[750,561,2300,613][11][B,I,][Times New Roman]]CONNECTION WITH THE PHASE 1/PHASE 2 PROPERTY CLOSE OF [[749,613,1442,665][11][B,I,][Times New Roman]]ESCROW: except as set forth on [[1404,613,1678,665][11][B,I,][Times New Roman]]Attachment [[1643,613,1869,665][11][B,I,][Times New Roman]]2 to this l [[1832,613,1978,665][11][B,I,][Times New Roman]]etter, [[1943,613,2300,666][11][,I,][Times New Roman]]all conditions of [[750,665,983,718][11][,I,][Times New Roman]]Section 4.6 [[969,665,2300,718][11][,I,][Times New Roman]]of the DDA have been satisfied (other than any conditions that apply [[750,719,1328,772][11][,I,][Times New Roman]]solely to the Phase 2 Parcel); [[1289,719,1343,771][11][B,I,][Times New Roman]]] (v)[[748,822,800,874][11][B,I,][Times New Roman]][ [[766,822,2300,874][11][B,I,][Times New Roman]]TO BE INCLUDED ONLY IN THE CITY STATEMENT DELIVERED IN [[750,875,2300,927][11][B,I,][Times New Roman]]CONNECTION WITH THE FIRST LOAN FUNDING FOLLOWING THE [[748,927,1059,979][11][B,I,][Times New Roman]]BORROWER [[1019,927,2300,979][11][B,I,][Times New Roman]]CERTIFICATION TO CITY OF THE OCCURRENCE OF THE [[749,979,1443,1031][11][B,I,][Times New Roman]]EQUITY COMPLETION DATE: [[1409,979,2300,1032][11][,I,][Times New Roman]]to the extent required by the DDA, all plans [[750,1032,2300,1085][11][,I,][Times New Roman]]and specifications for the Improvements to the Mortgaged Property that as of the [[750,1084,1877,1137][11][,I,][Times New Roman]]date hereof require the City’s approval have been approved [[1850,1084,1900,1137][11][,,][Times New Roman]]. [[1857,1084,1911,1136][11][B,I,][Times New Roman]]] 2.[[600,1187,650,1240][11][,I,][Times New Roman]][ [[618,1187,2299,1239][11][B,I,][Times New Roman]]TO BE INCLUDED ONLY IN THE CITY STATEMENT DELIVERED IN [[300,1241,2300,1293][11][B,I,][Times New Roman]]CONNECTION WITH THE FIRST LOAN FUNDING FOLLOWING THE BORROWER [[300,1293,2222,1345][11][B,I,][Times New Roman]]CERTIFICATION TO CITY OF THE OCCURRENCE OF THE EQUITY COMPLETION DATE:] [[2181,1293,2300,1346][11][,I,][Times New Roman]]The [[300,1345,1440,1398][11][,I,][Times New Roman]]City has received from Borrower the certification and othe [[1410,1345,2300,1398][11][,I,][Times New Roman]]r information required to be delivered to the [[300,1398,655,1451][11][,I,][Times New Roman]]City pursuant to [[620,1398,911,1451][11][,I,][Times New Roman]]Section 16.4.8 [[900,1398,2300,1451][11][,I,][Times New Roman]]of the DDA, and the City confirms that the Equity Completion Date has [[300,1451,2300,1504][11][,I,][Times New Roman]]occurred and the City no longer has the right to exercise the Right of Reversion (except as expressly [[295,1503,447,1556][11][,I,][Times New Roman]]provid [[420,1503,567,1556][11][,I,][Times New Roman]]ed in [[535,1503,829,1556][11][,I,][Times New Roman]]Section 16.4.8 [[820,1503,1314,1556][11][,I, ][Times New Roman]]of the DDA upon a Non [[1287,1503,1337,1556][11][,I,][Times New Roman]]- [[1300,1503,2300,1556][11][,I,][Times New Roman]]Permitted Foreclosure Event); provided that such [[300,1556,1912,1609][11][,I,][Times New Roman]]confirmation by the City is subject to the City’s rights against Developer pursuant to [[1874,1556,2163,1609][11][,I,][Times New Roman]]Section 16.4.8 [[2147,1556,2300,1609][11][,I,][Times New Roman]]of the [[298,1609,1376,1662][11][,I,][Times New Roman]]DDA if such information provided by the Developer to th [[1349,1609,1916,1662][11][,I,][Times New Roman]]e City is not true and correct [[1878,1609,1928,1662][11][,,][Times New Roman]]. [[1885,1609,1939,1661][11][B,I,][Times New Roman]]] 3.Based upon invoices received by the City and amounts expended by the City as of the date that is the last month end that is at least 15 days prior to the date hereof, the amount of the City Lien due and owing to the City from Developer pursuant to the DDA and the Property Documents (after application of any amount then available in the account holding the City Cost Deposit available to pay for such amount owing to the City) does not exceed [[950,1922,1000,1975][11][,I,][Times New Roman]][ [[968,1922,1259,1975][11][,I,][Times New Roman]]insert amount [[1217,1922,1271,1975][11][,I,][Times New Roman]]] [[1240,1922,1290,1975][11][,,][Times New Roman]]. [[991,2025,1041,2078][11][,I,][Times New Roman]][ [[1007,2025,1364,2078][11][,I,][Times New Roman]]Remainder of pag [[1337,2025,1570,2078][11][,I,][Times New Roman]]e left blank [[1536,2025,1590,2078 ][11][,I,][Times New Roman]]] Tustin Cornerstone I DDA Att 24 FORM ATTACHMENT 24City of Tustin/Flight Venture LLC Subordination Agt 06-12-2017.docxExhibit “C” 3 The undersigned acknowledges that Lender and its successors and assigns may rely upon this letter. This letter may 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 person signing this letter have any personal liability hereunder. CITY OF TUSTIN Dated: ________, 20__By: Name: _____________________________ Its City Manager APPROVED AS TO FORM By: David Kendig, City Attorney Tustin Cornerstone I DDA Att 24 FORM ATTACHMENT 24City of Tustin/Flight Venture LLC Subordination Agt 06-12-2017.docxExhibit “C” 4 Attachment 1 Modifications, Supplements or Amendments to Property Documents 1.[[450,607,500,660][11][,I,][Times New Roman]][ [[468,607,1290,660][11][,I,][Times New Roman]]enter “None” if there are no qualifications [[1253,607,1307,660][11][,I,][Times New Roman]]] Tustin Cornerstone I DDA Att 24 FORM ATTACHMENT 24City of Tustin/Flight Venture LLC Subordination Agt 06-12-2017.docxExhibit “C” 5 Attachment 2 Qualifications to Matters Confirmed in Statement 1.[[450,607,500,660][11][,I,][Times New Roman]][ [[468,607,1290,660][11][,I,][Times New Roman]]enter “None” if there are no qualifications [[1253,607,1307,660][11][,I,][Times New Roman]]] Tustin Cornerstone IDDA Att 24 FORM ATTACHMENT 24City of Tustin/Flight Venture Subordination Agt 06-12-2017.docxEXHIBIT “C” 6 EXHIBIT D FORM OF LENDER STATEMENT ________________, 20__ City of Tustin _________________ _________________ Attn: ____________ Re:Tustin Legacy Cornerstone I Ladies and Gentlemen: City The undersigned, on behalf of ___________ (“Lender”) is writing this letter to you (“”) Project regarding that certain office project (“”) that [[1261,1295,1311,1348][11][,I,][Times New Roman]][ [[1279,1295,1467,1348][11][,I,][Times New Roman]]has been [[1435,1295,1489,1348][11][,I,][Times New Roman]]] [[1468,1295,1518,1348][11][,I,][Times New Roman]][ [[1486,1295,1645,1348][11][,I,][Times New Roman]]may be [[1611,1295,1665,1348][11][,I,][Times New Roman]]] [[1645,1295,2300,1348][11][ ,,][Times New Roman]]constructed pursuant to the terms of that certain Subordination Agreement by and between the Cityof Tustin, a municipal corporation of the City State of California (the “”) and ___________________, the [[1536,1401,1586,1454][11][,I,][Times New Roman]][ [[1549,1401,2064,1454][11][,I,][Times New Roman]]predecessor in interest to [[2032,1401,2086,1454][11][,I,][Times New Roman]]] [[2072,1401,2300,1454][11][,,][Times New Roman]]Permitted Mortgagee dated ________________, 20__ and recorded against the Parcel in the Official Records Subordination Agreement (“”) on the Parcel. We are a Lender under the Subordination Agreement. Initially capitalized terms used and not defined herein shall have the meanings set forth in the Subordination Agreement. OriginalDeveloper City and Flight Venture LLC a Delaware limited liabilitycompany (“”) entered into that certain Tustin Legacy Disposition and Development Agreement Cornerstone I dated as of November 15, 2016as amended by that certain First Amendment to Tustin Legacy Disposition and DDA Development Agreement Cornerstone I dated as of ____, 2017 (the “”), relating to the conveyance Developer from the City to Original Developer or its successor of the Parcel. _________, a _________ (“” Borrower or “”) is the successor-in-interest to the Original Developer with respect to the Parcel under the DDA. Lender and Developer, as the borrower thereunder, subsequently executed the Loan Documents listed on Exhibit B to the Subordination Agreement at the time of the Phase [[1669,2083,1719,2136][11][,I,][Times New Roman]][ [[1687,2083,1773,2136][11][,I,][Times New Roman]]1/2 [[1741,2083,1795,21 36][11][,I,][Times New Roman]]] [[1773,2083,2300,2136][11][,,][Times New Roman]]Property Close of Escrow. As of the date of this letter, to the actual knowledge of [[1442,2186,2300,2238][11][B,I,][Times New Roman]][insert as applicable: Loan Officer or Asset [[298,2238,523,2290][11][B,I,][Times New Roman]]Manager] [[509,2238,1453,2291][11][,,][Times New Roman]]of Lender for the Loan, after consultation with [[1426,2238,2070,2291][11][,,][Times New Roman]], as to each such confirmation, [[2052,2238,2300,2291][11][,,][Times New Roman]]such other individualemployed by the Lender that such [[1123,2291,1780,2343][11][B,I,][Times New Roman]][Loan Officer or Asset Manager] [[1757,2291,1820,2344][11][,,][Times New Roman]]in [[1803,2291,2299,2344][ 11][,,][Times New Roman]]good faith believes to be best informed as to such matter (and without any other duty of inquiry): 1.Except as shown on Attachment 1to this letter, the Loan Documents have not been modified or amended [[698,2499,1797,2552][11][,I,][Times New Roman]][since the previous Lender Statement dated ____________ [[1769,2499,1965,2552][11][,I,][Times New Roman]]_, 20__ / [[1920,2499,2300,2552][11][,I,][Times New Roman]]from the executed [[300,2552,2300,2605][11][,I,][Times New Roman]]copies of the Loan Documents delivered by Lender and Borrower to escrow concurrently with the execution [[300,2605,901,2658][11][,I,][Times New Roman]]of the Subordination Agreemen [[874,2605,924,2658][11][,I,][Times New Roman]]t [[882,2605,936,2658][11][,I,][Times New Roman]]] [[905,2605,955,2658][11] [,,][Times New Roman]]. Tustin Cornerstone I DDA Att 24 FORM ATTACHMENT 24City of Tustin/Flight Venture Subordination Agt 06-12-2017.docxEXHIBIT “D” 1 2.Except as listed on Attachment 2to this letter, Lender has not delivered to Borrower or recorded against the Parcel any written notice of the existence of a Loan Default (in each case to the extent not previously sent to the City), and Attachment 2 indicates whether any such Loan Default has been waived by Lender or cured to Lender’s satisfaction in accordance with the Loan Documents; provided that the foregoing shall not apply to email correspondence except in the case that the Loan Documents specifically provide that email correspondence constitutes valid notice of default for the purposes of the Loan Documents. 3.As of ____________, 20__ [[1155,719,1205,772][11][,I,][Times New Roman]][ [[1173,719,2183,772][11][,I,][Times New Roman]]insert date as close as possible to Statement date [[2149,719,2203,772][11][ ,I,][Times New Roman]]] [[2193,719,2300,772][11][,,][Times New Roman]]the outstanding principal amount advanced by the Lender pursuant to the Loan Documents (after deducting therefrom payments of principal received by Lender from all sources, including if applicable, Borrower, Loan Guarantors, City and/or other Persons) is $___________. 4.As of ____________, 20__ [[1110,979,1160,1032][11][,I,][Times New Roman]][ [[1128,979,2047,1032][11][,I,][Times New Roman]]insert date as close as possible to Statement date [[2013,979,2067,1032][1 1][,I,][Times New Roman]]] [[2045,979,2300,1032][11][,,][Times New Roman]]the amount of accrued and unpaid interest owed to the Lender is $_____________. The undersigned acknowledges that City and only City may rely upon this letter. This letter may not be relied upon by any other party or for any other purpose without the express written consent of the Lender. This certificate shall be bindingupon the Lender and its successors and assigns. In no event shall the person signing this letter have any personal liability hereunder. LENDER Dated: ________, 20__By: Name: _____________________________ Its [[1407,1711,1457,1764][11][,I,][Times New Roman]][ [[1423,1711,1728,1764][11][,I,][Times New Roman]]INSERT TITLE [[1702,1711,1756,1764][11][,I,][Times New Roman]]] Tustin Cornerstone I DDA Att 24 FORM ATTACHMENT 24City of Tustin/Flight Venture Subordination Agt 06-12-2017.docxEXHIBIT “D” 2 Attachment 1 Modifications or Amendments to Loan Documents 1.[[450,607,500,660][11][,I,][Times New Roman]][ [[468,607,1290,660][11][,I,][Times New Roman]]enter “None” if there are no qualifications [[1253,607,1307,660][11][,I,][Times New Roman]]] Tustin Cornerstone I DDA Att 24 FORM ATTACHMENT 24City of Tustin/Flight Venture Subordination Agt 06-12-2017.docxExhibit “D” 3 Attachment 2 Qualifications to Matters Confirmed in Statement 1.[[450,607,500,660][11][,I,][Times New Roman]][ [[468,607,1290,660][11][,I,][Times New Roman]]enter “None” if there are no qualifications [[1253,607,1307,660][11][,I,][Times New Roman]]] ATTACHMENT 24City ofTustin/Flight Venture Tustin Cornerstone I DDA Att 24 FORM Subordination Agt 06-12-2017.docx Exhibit “D” 4 Attachment 27 Form of Landscape Installation and Maintenance Agreement ATTACHMENT 27 FORM OF LANDSCAPE INSTALLATION AND 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 LANDSCAPEINSTALLATION ANDMAINTENANCE AGREEMENT Flight at Tustin -Landscape Installation and SMRH:479631902.24Maintenance Agreement 06131725WR-246894 TABLE OF CONTENTS Page 1. Definitions........................................................................................................................................2 1.1"Association"..................................................................................................................2 1.2"Association Declaration"...............................................................................................2 1.3"City Indemnified Parties"...............................................................................................2 1.4"City Landscape Areas".................................................................................................2 1.5"City Successor".............................................................................................................2 1.6"DDA".............................................................................................................................2 1.7"Default Interest Rate"....................................................................................................2 1.8"Flight Association"........................................................................................................2 1.9"Flight Declaration".........................................................................................................2 1.10"Ground Lease"..............................................................................................................2 1.11"High Quality Project".....................................................................................................2 1.12"High Quality Standards"................................................................................................2 1.13"Landscape Areas".........................................................................................................2 1.14"Landscape Improvements"...........................................................................................3 1.15"License Agreement"......................................................................................................3 1.16"License Users"..............................................................................................................3 1.17"Licenses".......................................................................................................................3 1.18"Lot"................................................................................................................................3 1.19"Master Association"......................................................................................................3 1.20"Master Association Incorporation Date".......................................................................3 1.21"Master Declaration"......................................................................................................3 1.22"Official Records"...........................................................................................................3 1.23"Option"..........................................................................................................................3 1.24"Owner"..........................................................................................................................3 1.25"Perimeter Landscape Area"..........................................................................................3 1.26"Phase1 Landscape Area"............................................................................................3 1.27"Phase2 Association"....................................................................................................3 1.28"Phase2 Declaration"....................................................................................................4 1.29"Phase2 Landscape Area"............................................................................................4 1.30"Phase2 Owner"............................................................................................................4 1.31"Phase2 Transfer Date"................................................................................................4 1.32"Representatives"...........................................................................................................4 1.33"Requirements"..............................................................................................................4 1.34"Responsible Association".............................................................................................5 1.35"Responsible Party" or "Responsible Parties"...............................................................5 1.36"Successor Owners"......................................................................................................5 2.Access License................................................................................................................................5 2.1Perimeter Landscape Area............................................................................................5 2.2License for Phase1 Landscape Area and Phase2 Landscape Area...........................5 2.3No Interference with City Property.................................................................................6 2.4Damage..........................................................................................................................6 3.Installation and Maintenance Obligations........................................................................................6 3.1Installation......................................................................................................................6 3.2Maintenance Obligation.................................................................................................6 3.3Intentionally Omitted......................................................................................................7 3.4Standard of Maintenance...............................................................................................7 4.Allocation of Maintenance Responsibilities......................................................................................7 5.Term.................................................................................................................................................7 Flight at Tustin -Landscape Installation and -i- SMRH:479631902.24Maintenance Agreement 06131725WR-246894 6.Insurance.........................................................................................................................................8 6.1Requirements.................................................................................................................8 6.2Insurance Amounts........................................................................................................9 6.3Insurance for Contractors and Subcontractors..............................................................9 6.4Certificates and Endorsements......................................................................................9 6.5DDA Requirements........................................................................................................9 7.Indemnity........................................................................................................................................10 8.Mechanic's Liens............................................................................................................................10 9.Compliance with Requirements.....................................................................................................11 10.Enforcement and Termination........................................................................................................11 10.1City Remedies..............................................................................................................11 10.2Enforcement by Associations and the City..................................................................12 10.3Remedies for Non-Payment.........................................................................................12 11.Notices...........................................................................................................................................12 12.Estoppel Certificate........................................................................................................................14 12.1Issuance by Owners and Associations........................................................................14 12.2Issuance by City...........................................................................................................14 13.Excuse for Non-Performance.........................................................................................................14 14.Effect on Third Parties....................................................................................................................14 15.Third Party Beneficiary...................................................................................................................15 16.Entire Agreement...........................................................................................................................15 17.Amendment; Modification...............................................................................................................15 18.Cooperation....................................................................................................................................15 19.Subdivision.....................................................................................................................................15 20.Severability.....................................................................................................................................15 21.Governing Law...............................................................................................................................15 22.Waiverand Default.........................................................................................................................15 23.References to Sections, Clauses and Exhibits..............................................................................15 24.Counterparts..................................................................................................................................16 25.Runs With the Land; Release and Termination.............................................................................16 26.Assignment....................................................................................................................................16 Flight at Tustin -Landscape Installation and -ii- SMRH:479631902.24Maintenance Agreement 06131725WR-246894 LANDSCAPE INSTALLATION AND MAINTENANCE AGREEMENT Agreement This Landscape Installation and Maintenance Agreement ("") is entered into this _____day of Effective DateCity ___________,20__ ("") by and between the City of Tustin, a municipal corporation ("") Developer and Flight PhaseI Owner, LLC, a Delaware limited liability company (""). RECITALS All initiallycapitalized terms used but not defined in these Recitals shall have the meanings set forth in Section1. A.City and Flight Venture LLC, a Delaware limited liability company, the predecessor in interest to Developer, have entered into that certain Tustin Legacy Disposition and Development Agreement Cornerstone I dated as of November15, 2016which has been amended pursuant to that certain First Amendment to Tustin Legacy Disposition and Development Agreement Cornerstone I dated DDA as of June20, 2017(as the same may be amended from time to time, the "") pursuant to which Exhibit"A" Developer has acquired from City that certain real property legally described and depicted on Phase1 Parcel as Parcel1 ("") and pursuant to the DDA, has the option, as further set forth therein OptionExhibit"A" ("") to acquire from City that certain real property legally described and depicted on as Phase2ParcelDevelopment Parcels Parcel2(""; and collectively with the Phase1 Parcel the ""). The Exhibit"A-1" Phase1 Parcel and Phase2 Parcel are generally depicted on . B.In addition to the Phase2 Parcel, the City is also the owner of certain additional real property located within the public right of way adjacent to the Development Parcels legally described on Exhibit"B"City ROW Property (the "") which includes the Perimeter Landscape Area. C.City has approved certain entitlements with respect to the Development Parcels Entitlements ("") pursuant to City Council Resolution Nos.16-59, 16-60, 16-61, and 16-62, including, without limitation, Vesting Tentative Tract Map No.18003 and the conditions of approval with respect to the Entitlements, including without limitation Condition3.1(d)(i)of Resolution No.16-60, Conditions 2.1, 2.3, 2.4, 2.5, 2.10, 2.13, 2.26, 4.1, and 4.2 of Resolution No.16-61 approving Concept Plan 2016-001 Conditions (among other things), adopted by the Tustin City Council on November1, 2016 (""), require that Developer install and maintain, among other things, certain landscape, hardscape, irrigation and other improvements within the Phase1 Parcel, the Phase2 Parcel and the City ROW Property. D. Developer has agreed to install and maintain landscaping on the Perimeter Landscape Area and in certain adjacent areas on the Development Parcels comprised of the Phase1 Landscape Area and the Phase2 Landscape Area and has agreed toexecute this Agreement in order to provide for maintenance of the Landscape Areasby Developer, other Owners, including their respective Successor Owners and the applicable Responsible Association(s), as further described below. E. Concurrently with the recordation of this Agreement in the Official Records, a Master Declaration is being recorded in the Official Records against the Phase1 Parcel and Phase2 Parcel which, asdescribed below, provides for the establishment of a Master Association upon the occurrence of certain events described as the Master Association Incorporation Events in the Master Declaration and the Flight Declaration is being recorded in the Official Records against the Phase1 Parcel which, as described below, provides for the establishment of the Flight Association. The Master Declaration and the Flight Declaration establish procedures to ensure that the Landscape Areas are maintained in accordance with all of the requirements set forth in this Agreement as described herein. Flight at Tustin -Landscape Installation and -1- SMRH:479631902.24Maintenance Agreement 06131725WR-246894 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 Definitions 1.. For purposes of this Agreement, the following capitalized terms shall have the following meanings: "Association" 1.1means either the Flight Association, Phase2 Association and/or the Master Association as the context requires. "Association Declaration" 1.2means the Flight Declaration, the Master Declaration and/or the Phase2 Declaration, as the context requires. "City Indemnified Parties" 1.3meansCityand its appointed and elected officials, agents, attorneys, affiliates,employees, contractors, consultants and representatives. "City Landscape Areas" 1.4means (a)the Perimeter Landscape Area, and (b)thePhase2 Landscape Area. "City Successor" 1.5means a governmental successor or assign of the City. "DDA" 1.6meansthe Tustin Legacy Disposition and Development Agreement Cornerstone I entered into by and between the City of Tustin and Flight Venture LLC, a Delaware limited liability company on November15, 2016, which has been amended pursuant to that certain First Amendment to Tustin Legacy Disposition and Development Agreement Cornerstone I dated as of June20, 2017, and any further amendments or supplements thereto. "Default Interest Rate" 1.7means an interest rate of eight percent (8%) per annum, compounded annually, but in no event in excess of the maximum legal rate. "Flight Association" 1.8means the Flight at Tustin Legacy Owners Association, a California non-profit mutual benefit corporation formed or to be formed to govern the Phase1 Parcel, and if the annexation by the Flight Association of all or any portion of the Phase2Parceloccurs, the portion of the Phase2 Parcelso annexed. "Flight Declaration" 1.9means the Declaration of Covenants, Conditions and Restrictions and Establishment of Easements of The Flight at TustinLegacy, and all amendments and supplements thereto. "Ground Lease" 1.10means any written ground lease of an entire Lot with an initial term, excluding option terms, of thirty five (35) years or more, which is recorded inthe Official Records or as to which a Memorandum of Lease (or likeinstrument)has been so recorded. "High Quality Project" 1.11means a project for which the operation and maintenance activities, including landscaping, shall be similar to those provided at the Campus at Playa Vista, provided that from and after the Phase2 Transfer Date, the standards for any portions of the Phase2 Parcel which have been transferred shall be the standard set forth in the Requirements applicable to such portions of the Phase2 Parcel which have been transferred. "High Quality Standards" 1.12means, in terms of the quality of maintenance, standards consistent with a High Quality Project. "Landscape Areas" 1.13means the Perimeter Landscape Area, the Phase1 Landscape Area and the Phase2 Landscape Area, collectively. Flight at Tustin -Landscape Installation and -2- SMRH:479631902.24Maintenance Agreement 06131725WR-246894 "Landscape Improvements" 1.14means any and all landscaping, irrigation and/or hardscape improvements constructed and/or installed on the Landscape Areas by Developer, any Owner or any Association for purposes consistent with the licenses granted by this Agreement. The Landscape Improvements shall be constructed or installed in accordance with the Requirements. "License Agreement" 1.15means that certainLicense Agreement for Site Development entered into concurrently herewith by the City and Developer governing initial construction of the Landscape Improvements, as the same may be amended from time to time. "License Users" 1.16means the respective employees, consultants, contractors, subcontractors, representatives and agents of each Responsible Party with respect to portions of the Development Parcels and/or Perimeter Landscape Area for which it has responsibility under this Agreement. "Licenses" 1.17means the licenses granted by Section2.1and Section2.2, collectively. "Lot" 1.18meanseach legally subdivided lot within the Phase1 Parcel or the Phase2 Parcel created under a final tract map recorded against either such Parcel. "Master Association" 1.19means the Master Maintenance Association for Tustin Legacy Cornerstone I, a California non-profit mutual benefit corporation which shall be incorporated upon the occurrence of certain events as described in the Master Declaration. "Master Association Incorporation Date" 1.20means the date the Master Association is incorporated pursuant to the Master Declaration. "Master Declaration" 1.21means the Master Declaration Establishing Maintenance and Cost Sharing Obligations for Tustin Legacy Cornerstone I recorded concurrently with this Agreement, and any amendments and supplements thereto. "Official Records" 1.22means the official public records in the Office of the County Recorder of Orange County. "Option" 1.23has the meaning set forth in Recital A. "Owner" 1.24meansthe Developer and each Successor Owner during such person's or entity's ownership of a fee title interest in, or Ground Lease interest in, any portion of the Phase1 Parcel or the Phase2 Parcel and (b)each Successor Owner of City, during such person's or entity's ownershipof a fee title interest in, or Ground Lease interest in the Phase2 Parcel, but specifically excluding the City and City Successors. "Perimeter Landscape Area" 1.25means the portions of the City ROW Property fronting on a public street adjacent to the Development Parcels between the back of curb of such street Exhibit"C" and the perimeter boundary of the Development Parcels, as depicted on [[1860,2431,1910,2479][10][,I,][Arial]]. "Phase1 Landscape Area" 1.26meanstheportion of the Phase1Parcel between the Perimeter Landscape Area and the minimum required building setback line along the public streets, Exhibit"C" generally in the location depicted on ,which setback is derived from the zoning development standards applicable to the Development Parcels as of the Effective Date. "Phase2 Association" 1.27means the owners association which shall be formed to govern the Phase2 Parcel or the portion thereof acquired by an Owner of the Phase2 Parcel upon the Phase2 Transfer Date if and when the Lots within the Phase2 Parcel are owned by multiple different Owners. After the Phase2 Transfer Date, if the Phase2 Association has not been incorporated, and all Flight at Tustin -Landscape Installation and -3- SMRH:479631902.24Maintenance Agreement 06131725WR-246894 of the portions of the Phase2 Parcel acquired by an Owner of the Phase2 Parcel and not annexed to the Flight Association are owned by a single Owner, references in this Agreement to the Phase2 Association shall mean such Owner of the Phase2 Parcel. "Phase2 Declaration" 1.28means any declaration of covenants, conditions and restrictions recorded in connection with the Phase2 Transfer Date providing for the establishment of the Phase2 Association. "Phase2 Landscape Area" 1.29meansthat portion of the Phase2 Parcel depicted Exhibit"C" on,as the Phase2 Landscape Area and located between the Perimeter Landscape Area and theminimum required building setback line along the public streets, generally in the location depicted on Exhibit"C" ,which setback line is derived from the zoning development standards applicable to the Development Parcels as ofthe Effective Date, provided that, (a)until such time when the improvements to be constructed on the Phase2 Parcel have been completed, the Phase2 Landscape Area means that portion of the Phase2Parcel between the Perimeter Landscape Area andthe minimum required building setback line along Barranca Parkway and between the Perimeter Landscape Area and the minimum required landscape setback line along Armstrong Avenue, generally in the location depicted on Exhibit"C" ', which setback line is derived from the zoning development standards applicable to the Development Parcels as of the Effective Date, and (b)upon conveyance by the City of its fee interest or a Ground Leaseinterestin any portion of the Phase2 Parcel, the conveyed portion of thePhase2 Landscape Area shall be excluded from the definition of City Landscape Areas. "Phase2 Owner" 1.30means (a)the City, during any period in which the City is the fee owner of all or any portion of the Phase2 Parcel, as to the portion of the Phase2Parcel owned by the City and not then subject to a Ground Lease and (b)following conveyance by the City of its fee interest or a Ground Lease interest in all or any portion of the Phase2 Parcel to an entity other than a City Successor, the Owner of such portion of the Phase2 Parcel so conveyed or leased. "Phase2 Transfer Date" 1.31means, in the event the holder of the Option under the DDA or its nominee fails to exercise the Option and acquire the entirety of the Phase2 Parcel, the date on which the City transfers fee title toor any Ground Lease interest in all or any portion of the Phase2 Parcel to the Phase2 Owner for the purpose of development of the Phase2 Parcel without such property having been annexed to the Flight Declaration. "Representatives" 1.32means 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 a person or entity holding fee title to, a Ground Lease interest in, or a license pursuant to this Agreement in the Development Parcels or any portion thereof (such as Developer, Owner, Successor Owners, or any Association) during the time period that such person or entity holds fee title to, a Ground Lease interest in, or an easement interest in, the Development Parcels or any portion thereof. "Requirements" 1.33means (a)during the term thereof, the requirements of the DDA, including without limitation, Section8 thereof, the Memorandum of DDA and the Tustin Legacy Cornerstone I Development Agreement by and between the City and Flight Venture LLC, a Delaware limited liability company dated December15, 2016, which was recorded against the Development Parcels,(b)during the term of eachagreement orinstrument recorded pursuant to the DDA, the term of such agreement or instrument, (c)the most current general plan for the City and the MCAS Tustin Specific Plan/Reuse Plan, as amended from time to time, (c)the Entitlementsand Conditionsand all future entitlements and conditions of development approved by the City for the Development Parcels, including without limitation those imposed by the City in connection with any discretionary land use approval and entitlements as a condition to the development of the Phase2 Parcel,and (e)all laws, rules and regulations relating to the obligations under this Agreement, including without limitation, those issued by the City, the Environmental Protection Agency, or any federal, state, interstate, regional or local governmental agency having jurisdictionover the Landscape Areas or any of them, including without limitation, with respect to abatement or prevention of pollution. Flight at Tustin -Landscape Installation and -4- SMRH:479631902.24Maintenance Agreement 06131725WR-246894 "Responsible Association" 1.34initially means the Flight Association, if the Flight Association has been assigned the maintenance obligations for the LandscapeAreas hereunder. If and when the Master Association Incorporation Date occurs, then the Master Association (and not the Flight Association) shall be the Responsible Association for themaintenance of the Landscape Areas unless the Members (as defined in the Master Declaration) unanimously determine that the Phase2 Association shall be the Responsible Association with respect to the Phase2 Landscape Area and the portion of the Perimeter Landscape Area adjacent to the Phase2 Landscape Area in which event the Flight Association shall assign its rights and obligations under this Agreement with respect thereto to the Phase2 Association and the Flight Association shall remain the Responsible Association for maintenance of the Phase1 Landscape Area and the portions of the Perimeter Landscape Area adjacent to the Phase1 Landscape Area regardless of the occurrence of the Master Association Incorporation Date or the Phase2 Transfer Date. "Responsible Party"or "Responsible Parties" 1.35shall initially mean Developer and, if the City shall have conveyed fee title to or a Ground Lease interest in all or any portion of the Phase2Parcel to any Successor Owner, such Successor Owner, as to the portion of the Phase2 Parcel owned by it or subject to Ground Lease in its favor, but upon the transfer of obligations hereunder in accordance with Section26of this Agreement by any Owner with respect to a portion of the Landscape Areas to a Responsible Association, means, as to such Landscape Area, the Responsible Association(s). "Successor Owners" 1.36means, as applicable, the successors and assigns of Developer and/or City owning all or any portionof the Development Parcelsand/or holding a Ground Lease interest therein, but specifically excluding Developer,City and City Successors. Access License 2.. Perimeter Landscape Area 2.1. The initial installation of Landscape Improvements within the Perimeter Landscape Area shall be carried out pursuant to the License Agreement granted by the City to Developer and any encroachment permits required to be executed by the City for the Perimeter Landscape Area. Following completion of the initial installation of Landscape Improvements, for so long as Developer and/or any Successor Owners shall have the obligation under this Agreement to install Landscape Improvements uponthe Perimeter Landscape Area, unless earlier terminable or terminatedby the City pursuant to thisAgreement, the City hereby grantsfor the benefit of Developer and Successor Owners and their respective License Usersandthe Responsible Parties and binding upon City and each City Successor owning all or any portion ofthe Perimeter Landscape Area, a non-exclusive license on, over and acrossthe Perimeter Landscape Areafor the purpose of installing Landscape Improvements thereon. From and after completion of construction of any of the Landscape Improvements, unless earlier terminable orterminated by City pursuant to this Agreement, the City hereby grants for the benefit of the Responsible Party having the obligation under this Agreement to maintain Landscape Improvements upon the Perimeter Landscape Area and its License Usersand binding upon City and each Owner and City Successor owning all or any portion of the Perimeter Landscape Area, a non-exclusive license on, over and across the Perimeter Landscape Area for the purpose of installing (other than for the initial construction thereofby the Phase1 Owner pursuant to the DDA) maintaining, repairing and replacing the Landscape Improvements thereonand for use, installation, maintenance, repair and replacement of utilities (including without limitation, electrical, water, storm drains and/or drainage) required to maintain the Perimeter Landscape Area and landscaping and improvements thereon, in each case as may be required or reasonably necessary for the installation, construction, use, maintenance, repair and replacement of the LandscapeImprovements. License for Phase1 Landscape Area and Phase2 Landscape Area 2.2. Phase1 Landscape Area (a). Developer hereby grants for the benefit of the Responsible Party having the obligation under this Agreement to maintaintheLandscape Improvementslocated within the Phase1 Landscape Area and to its License Users, and binding upon each successor in interest of Developer owning all or any portion of the Phase1 Parcel, a non-exclusive licensein, on, over and across the Phase1 Landscape Area, whichlicense is binding upon all Lots within Flight at Tustin -Landscape Installation and -5- SMRH:479631902.24Maintenance Agreement 06131725WR-246894 the Phase1 Parcel upon which the Phase1 Landscape Area are located, for the purpose of installing, maintaining, repairing and replacing theLandscape Improvements thereonand for use, installation, maintenance, repair and replacement of utilities (including without limitation, electrical, water, storm drains and/or drainage) required to maintain the Phase1 Landscape Areaand landscaping and improvements thereon, in each case as may be required or reasonably necessary for use, installation maintenance, repair and replacement of the Landscape Improvements. Phase2 Landscape Area (b). The initial installation of Landscape Improvements within the Phase2 Landscape Area shall be carried out pursuant to the License Agreement granted by the City to Developer. Following completion of the initial installation of Landscape Improvements, for so long as Developer and/or any Successor Owners shall have the obligation under this Agreement to install Landscape Improvements uponthe Phase2Landscape Area, unless earlier terminable or terminatedby theCity pursuant to thisAgreement, the City hereby grants for the benefit of the Responsible Party having the obligation under this Agreement to maintain the Landscape Improvementslocated within the Phase2 Landscape Area and to its License Users,and binding upon each successor in interest of City owning all or any portion of the Phase2 Parcel, a non-exclusive license in, on, over and across the Phase2 Landscape Area, which license isbinding upon all Lots within the Phase2 Parcel upon which the Phase2 Landscape Area is located, for the purpose of installing, maintaining, repairing and replacing theLandscape Improvements thereonand for use, installation, maintenance, repair and replacement of utilities (including without limitation, electrical, water, storm drains and/or drainage) required to maintain the Phase2 Landscape Areaand landscaping and improvements thereon, in each case as may be required or reasonably necessary for use,installation,maintenance, repair and replacement of the Landscape Improvements. No Interference with City Property 2.3. Unless otherwise permitted by this Agreement, the Responsible Party shall cause all work performed on the City Landscape Areaspursuant to the Licenses to be performed in a manner so as not to, with respect to theCity Landscape Areas, the City ROW Property, adjoining public right of way or other City-owned property, including during the period it is owned by the City, the portions of the Phase2 Parcel owned by the City:(a)cause any material increase in the cost of any construction or maintenance by theCity;(b)unreasonably interfere with use, occupancy or enjoyment of (andtherefore, to provide continual access to)such property or (c)lead to or cause erosion of such City-owned property. Damage 2.4.Any damage occurring to the City Landscape Areasor any portion thereof as a result of construction work on the Development Parcels, or any portion thereof, or as a result of work required in connection with development of the Development Parcels, or any portion thereof,shall be the responsibility of the Developer, Successor Owner or Association performing such construction and shall be repaired promptly by, and at the sole cost and expense of, the responsible Developer,Successor Owner or Association, to substantially the same condition as existed immediately prior to such work. Installation and Maintenance Obligations 3.. Installation 3.1. Developer and any Successor Owner having the responsibility to construct and install the Landscape Improvements uponthe Landscape Areas shall carry out such construction and installation in accordance with the Requirements, including without limitation, the Scheduleof Performance attached as Attachment 8 to the DDA, if then applicable, and, to the extent not inconsistent herewith or therewith, any subsequently recorded documents containing covenants, conditions and restrictions recorded against the Development Parcels, or any portion thereof, that include CC&Rs provisions related to landscape installation and maintenance (""), and shall provide, prior to commencement of such construction or installation, the insurance required by Section6of this Agreement to be maintained by a Responsible Party carrying out construction. Maintenance Obligation 3.2. Upon completion of the installation and construction of Landscape Improvements for all or any portion of the Landscape Areas and for the Term of this Agreement, regardless of the ownership of the Phase1 Parcel, the Phase2 Parcel and the Perimeter Landscape Area, the Responsible Party with respect to each Landscape Areas shall maintain, repair, Flight at Tustin -Landscape Installation and -6- SMRH:479631902.24Maintenance Agreement 06131725WR-246894 replace and restore, at its sole cost and expense, the Landscape Improvements and the Landscape Areas, including, without limitation any hardscape and paving materials, in the same aesthetic and sound condition or better as the condition of such improvements at the time of their acceptance by the City, excepting only reasonable wear and tear and any necessary replacement of Landscape Improvements pursuant to this Agreement. Any necessary replacements of Landscape Improvements shall be consistent with the terms of this Agreement and the Requirements and the quality of improvements originally approved by City and nothing herein shall limit theCity's right to review and approve such Landscape Improvements to ensure compliance with the terms hereof and the Requirements. The Landscape Areas shall be maintained in accordance with the terms and conditions set forth in this Section3and Section4. All utilities required to maintain the Landscape Improvements including, without limitation, water and electrical, shall be paid for by, or caused to be paid by,the Responsible Party(ies) and such utilities may at the discretion of the Responsible Party(ies)be on separate metersor submeters. For avoidance of doubt, the approval or consent by the City to any CC&Rs, shall not amend or modify any provision of this Agreement or constitute a waiver by the City of the provisions of this Agreement. Intentionally Omitted 3.3. Standard of Maintenance 3.4. The standard for the quality of maintenance of the Landscape Areas and Landscape Improvementsset forth in this Section3.4shall be met whether or not a specific item of maintenance is listed below. However, representative items of maintenance shall include: (a)proper maintenance of all Landscape Areas and Landscape Improvements such that they are evenly cut and evenly edged, where appropriate, reasonably free of bare and brown spots, debris, trash, litter, droppings and weeds; (b)maintenance, repair and replacement on a regular schedule, of landscaping, hardscaping, irrigation systems and storm drain systems and utilities; (c)frequentand regular inspection for graffiti or damage or deterioration or failure, and reasonably prompt repair or replacement of all surfaces, fencing, walls, lighted bollards, decorative pavement, equipment, etc., as necessary; (d)fertilizing, irrigating and replacing vegetation, as necessary; (e)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 Standards; (f)adequate maintenance of all Landscape Areas and Landscape Improvements such as not to be detrimental to public health, safety, or general welfare; (g)regular and even trimming and pruning of all trees and shrubs by a licensed landscape contractorso 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 and (h)prompt removaland replacement ofall dead plant material with an approved replacement.Unless otherwise approved by the City, theResponsible Party(ies)shallcause all landscaping within the Landscape Areasto be maintained in a consistent manner so that all landscaping within the Landscape Areas isconsistent in appearance, regardless of which Development Parcel, or portion thereof, comprises a portion of or is located adjacent to such Landscape Area and in an Event of Default with respect to this obligation, the Responsible Party(ies) with respect to such Event of Default (as defined in Section10.1),shall pay to the City the costs incurred by the City to conform the Landscape Areas to a uniform appearance. Allocation of Maintenance Responsibilities 4.. Prior to assignment by Developer to the Responsible Association, the maintenance responsibilities set forth in this Agreement shall be vested in Developer,and upon and after such assignment, such maintenance responsibilities shall be vested in the Responsible Association(s). If at any time during the Term, the entity responsible for the maintenance obligations to be performed under this Agreement shall fail to perform any such maintenance responsibilities, thenDeveloper (prior to assignment to the Responsible Association) or the applicable Responsible Association (after assignment to such Responsible Association) shall promptly cure such failureat its sole cost and expense; provided that nothing herein shall preclude such person or entity from obtaining reimbursement from the other Owners for actual costs incurred in performing such cure as provided below. Term 5.. The term of this Agreement shall be perpetual, unless termination is consented to by (a)the Cityas the owner of all or any portion of the Phase2 Parcel, and following its conveyance of its Flight at Tustin -Landscape Installation and -7- SMRH:479631902.24Maintenance Agreement 06131725WR-246894 interests in the Phase2 Parcel, in its governmental capacity, (b)prior to any assignment by Developer to an Association of all of its obligations hereunder, byDeveloper, and following any assignment by Developer or any Successor Owner of Phase1 to an Association, by such Association and to the extent Developer has not assigned all of its obligations, by Developer, and (c)prior to any assignment by the Owner of the Phase2 Parcel to an Association of all of its obligations hereunder, by such Owner, and following any assignment by the Owner of the Phase2 Parcel or any Successor Owner of Phase2 to an Association by such Association and to the extent the Owner of the Phase2 Parcel has not assigned all Term of its obligations hereunder, the Owner of the Phase2 Parcel, each in its sole discretion(the ""), except that (1)the City, as the issuer thereof, or its City Successorsowning the Perimeter Landscape Area,may unilaterally terminate theLicense grantedin Section2.1and this Agreement with respect to the Perimeter Landscape Area at any time and forany reasonand the City may thereafter utilize the Perimeter Landscape Area for any purpose (and the Owners within the Phase1 Parcel and Phase2 Parcel and each Association shall cooperate with the City with respect to such termination, including, if requested by the City, by executing and or causing their members to execute a quitclaim deed, in recordable form, quitclaiming their respective interests, if any, in the Perimeter Landscape Area to the City, and (2)the City and its Governmental Successors may terminate the Licenses, or either of them, and/or may terminate this Agreement as pertains to the Landscape Areas covered by such Licenses following an Event of Defaultunder this Agreement or a Material Default under the DDA. In the event of an election by City or its City Successors to so terminate any License or interest in this Agreement, the City shall deliver notice to the Responsible Parties of its election to terminate. Effective upon the date of such termination, the Responsible Party to which the termination is effective shall be released from the responsibility to maintain the Landscape Improvements upon the applicable portions of the City Landscape Areas; provided that such Responsible Party shall not be released with respect to matters occurring or accruing during the period in which such person was the Responsible Party. Upon such termination, the Landscape Improvements, utilities (including without limitation, electrical, water, storm drains and/or drainage) and other improvements installed upon the affected City Landscape Area, as applicable, shall become the property of the City at no cost or expense to the City, and the Responsible Party(ies) and City shall cooperate with each other and shall execute such agreements as may be required (i)to effectuate the same; (ii)to transfer title to the City of all landscaping, personal property, utilities (including without limitation, electrical, water, storm drains and/or drainage), and fixtures, if any, located thereon at no cost to City (to the extent such transfer has not already occurred); and (iii)to enable the City to continue the use of utility services (including without limitation, electrical, water, storm drains and/or drainage) used to maintain such landscaping and improvements, including without limitation, to provide drainage and lighting on the affected Landscape Area(s), provided that the transfer of any utility services shall be at no cost to the City but the City's use of such utility services for maintenance of such Landscape Areasshall be at no cost or expense to the Owners or the Responsible Party(ies). Insurance 6.. Requirements 6.1.Fromand after the Effective Date, each Responsible Party shall, as to the portions of the Landscape Areas for which it is responsible, procure and maintain, at its own cost, and submit to City at least seven (7)calendar days prior to the commencement of installation of the Landscape Improvements,evidence of liability and property damage insurance against claims for injuries against persons or damages to property including the City Landscape Areas and against liability of such Responsible Party or any of its Representatives arising out of or in connection with the presence, activities or work on or use of the Landscape Improvements and/or Landscape Areas or any act or omission to act of such Responsible Party or any of its Representatives with respect to the Landscape Areas and/or Landscape Improvements. Allpolicies of liability and property damage insurance shall be primary, and any other insurance, deductible, or self-insurance maintained by City, its elected and appointed officials, agents, representatives and employees, shall not contribute with this primary insurance. Policies shall contain or be endorsed to contain such provisions. Each Responsible Party performing work on the Landscape Areas shall also carry workers' compensation insurance in accordance with California worker's compensationlaws. Each Owner and each Association hereby waives, and agrees to obtain endorsements from its workers' compensation insurer waiving, all subrogation rights under its workers' compensation insurance policy against the City, its elected and appointed officials, agents, representatives and employees and require each of its subcontractors, if any, Flight at Tustin -Landscape Installation and -8- SMRH:479631902.24Maintenance Agreement 06131725WR-246894 and each subcontractor's insurer, to do likewise under their workers' compensation insurance policies. The procuring of such insurance and the delivery of policies or endorsements evidencing the same shall not be construed as a limitation of each Owner's or any Association's obligation to indemnify City and the City Indemnified Parties as set forth herein. Insurance Amounts 6.2.The amount of insurance required hereunder shall include comprehensive general liability, personal injury and automobile liability with limits of at least One Million Dollars($1,000,000) combined single limit coverage per occurrence, and for each contractor or subcontractor that is professionally licensed and is engaged to perform professional design or engineering services, professional liability coverage with limits of at least One Million Dollars ($1,000,000) insuring against all liability of each Responsible Party and its Representatives arising out of or in connection with the presence, activities or work on or use of the Landscape Improvements and/or Landscape Areas or any act or omission to act of such Responsible Party and its Representatives with respect to the Landscape Areas and/or Landscape Improvements. The foregoing minimum amounts of liability and professional liability coverage shall be increased by fifty percent (50%) on each tenth-year anniversary of the Effective Date (compounding each increase), or such lower amount as the City's Risk Manager, in his or her sole discretion, approves in writing. Insurance for Contractors and Subcontractors 6.3. In addition, each Responsible Party shall be responsible for causing any contractor or subcontractor installing or doing substantial repair or replacement in any portion of the Landscape Areas to procure and maintain the same types and amounts of insurance, and in compliance with the terms set forth in this Section6, including but not limited to endorsing each liability policy, with the exception of any professional liability or workers' compensation policy, to add the City, its elected and appointed officials, agents, representatives and employees as additional insureds to such policies. No Responsible Party or any other Owner shallallow any contractor or subcontractor to commence any work or services in any portion of the Landscape Areas unless and until it has provided evidence satisfactoryto City that the contractor or subcontractor has secured all insurance required under this Section6.Each Responsible Party shall monitor and review all such coverage and assumes all responsibility for ensuring that each contractor's and subcontractor's insurance coverage is provided and maintained in conformity with the requirements of this Section6. Certificates and Endorsements 6.4.Eachparty responsible to provide insurance pursuant to this Sectionwill furnish to City duly 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 City from 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 ACORDcertificate 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 Date of this Agreement and annually evidencing renewals of each policy. The endorsements shall provide as follows: (a)designate the City, its elected and appointed officials, agents, representatives and employees as additional insureds on the commercial general liability policies; (b)the commercial general liability insurance coverage shall be primary, and not contribute with any insurance or self-insurance maintained by City and (c)a waiver of subrogation for the benefit of the Cityon all policies with the exception of any professional liability policy required by this Agreement. All such insurance excluding professional liability 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. DDARequirements 6.5. Theforegoing requirements of this Section6may be satisfied during the term of the DDA by insurance required by the DDA but shall not subtract from any insurance obligations of Developer or any Successor Owner to City under the DDA. Allrequired insurance shall be kept in effect during the term of this Agreement and shall not be cancelable without thirty (30) days written notice to City of any proposed cancellation or ten (10)days' notice for cancellation due to non-payment of premium). Endorsements evidencing the foregoing and designating the City, its Flight at Tustin -Landscape Installation and -9- SMRH:479631902.24Maintenance Agreement 06131725WR-246894 elected and appointed officials, agents representatives and employees as additional insureds shall be delivered to and approved by City prior to commencement of activities under the Licenses. The procuring of such insurance and the delivery of policies or endorsements evidencing the same shall not be construed as a limitation of an Owner's or any Association's obligation to indemnify City, and the City Indemnified Parties as set forth herein. Indemnity 7..Developer, for the period prior to its assignment of its interests in this Agreement to a Successor Owner or an Association pursuant to Section26,the Owner of the Phase2 Parcel prior to its assignment of its interests in this Agreement to a Successor Owner or an Association pursuant toSection26, andeach Responsible Party for the period in which it is the Responsible Party following assignment pursuant to Section26,shall 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, and liability arising out of or in connection with (a)the presence, activities or work on or use of the Landscape Improvements and/or Landscape Areas by each Owner, each Association and/or theirRepresentatives, (b)any act or omission to act of any Owner, each Association and/or its Representatives with respect to the Landscape Areas and/or Landscape Improvements, (c)entry onto the Landscape Areas by any Owner, Association, and/or any of their Representatives in connection with this Agreement, (d)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 an Owner, Association or anyRepresentative with respect to the Landscape Areas and/or Landscape Improvements,and(e)costs to remove or bond mechanics'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 work performed or caused to be performed by such Owner or Association affecting the Landscape Areas; provided that the indemnity under clauses (a)through (d)shall not apply to the extent of the gross negligence, willful misconduct or fraud of the City or any City Indemnified Party. The provisions of this Section7shall survive the termination of this Agreement only with respect to events occurring while this Agreement is in effect.Notwithstanding the foregoing, from and after the Phase2 Transfer Date, the indemnification obligations of the Flight Association apply with respect to all matters for which the Flight Association is theResponsible Party and/or to actions or omissions of the Flight Association, the Owners of Lots in the Phase1 Parcel and their respective Representatives, and the indemnification obligations of the Phase2 Association, apply with respect to all matters for which the Phase2 Association is the Responsible Party and/or to the actions or omissions of the Phase2 Association, the Owners of Lots in the Phase2 Parcel and their respective Representatives and the indemnification obligations of the Master Association apply with respect to all matters for which the Master Association is the Responsible Party and/or to actions or omissions of the Master Association, and to the extent such Owners are Members (as defined in the Master Declaration) of the Master Association, the Owners of Lots in the Phase1 Parcel and the Owners of Lots in the Phase2 Parcel and their respective Representatives. Nothingcontained herein shall limit the right of any Association to pursue any remedies at law or equity against any Owner, Association or member of such Association, in accordance with the terms of its Association Declaration or any other Association, if an Association is required to indemnify one or more City Indemnified Parties hereunder, for reimbursement, and each Association and each Owner and member of any Association waives any right to assert defenses to any indemnity provided by such Association to the extent the Association was required by the City Indemnified Parties or any court order to indemnify the City Indemnified Parties as a result of actions of such Owner or Association or their Representatives. If any Association and/or any Owner fails to reimburse an Association providing the indemnity for all costs and expenses incurred hereunder, including without limitation attorneys' fees and costs, the Association shall, if it lacks sufficient funds to meet its obligations, pursue any or all of its remedies provided hereunder, including without limitation, the remedies under Section10and the remedies under its applicable Association Declaration. The indemnity set forth in this Section7shall survive the termination of this Agreement. Mechanic's Liens 8.. In performing its obligations under this Agreement, the Responsible Party shall promptly pay all costs, expenses, liabilities and liens arising out of or in any way connected with the contracts for any service, labor or materials provided or supplied. Each Responsible Party shall keep the Landscape Areas for which it is responsible for maintenance free and clear of any mechanics' liens or materialmen's liensarising with respect to the Landscape Improvements or performance of Flight at Tustin -Landscape Installation and -10- SMRH:479631902.24Maintenance Agreement 06131725WR-246894 responsibilities under this Agreement. Each Responsible Party 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 upon the Landscape Areas. Notwithstanding the foregoing, any Responsible Party may contest the amount, validity or application, in whole, or in part, of any such liens or stop notices; subject, however, to the further requirement that none of the Landscape Areas, the Development Parcels, any Landscape Improvements or any part 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 the Responsible Party then, such Responsible Party shall promptly pay the amount required to be paid, together with all interest and penalties accrued thereon. The provisions of this Section8shall survive the termination of this Agreement. Compliance with Requirements 9..Each Ownerand Association shall comply with all Requirements including without limitation, those issued by the Environmental Protection Agency, or any federal, state, interstate, or local governmentalagency having jurisdiction to abate or prevent pollution. The disposal of any toxic or hazardous materials within the Landscape Areas is specifically prohibited. No Owner or Association shall discharge waste or effluent from the Landscape Areas in such amanner 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 Developeror any other Owner to City under the DDA, or, from and after the Phase2 Transfer Date, any environmental responsibilities to the City of the Phase2 Owner and any Successor Owners of any portion of the Phase2 Parcel under any exclusive negotiating agreement, disposition and development agreement, ground lease, or other binding agreement withthe City. Enforcement and Termination 10.. City Remedies. 10.1In the event of a breach of any provision of this Agreement, City Default Notice may demand by written notice issued to the then-Responsible Party(ies) ("") that the violation be cured. Except for utility service interruptions or similar emergencies which shall not require advance notice or cure periods hereunder,ifthe then-Responsible Party(ies) do(es) not cure the violation within thirty (30) days after receiptof the Default Notice (each such non-curing Responsible Party, the Non-Curing Party ""), or if such default is of a kind which cannot reasonably be cured within thirty (30) days, and such Non-Curing Party does not within such thirty (30) day period commence to cure such Event of Default default and diligently thereafter prosecute such cure to completion (""), then City shall have the right, but not the obligation, to (a)institute legal action against such Non-Curing Party for specific performance, injunction, declaratory relief, damages, or any other remedy provided by law, (b)pay any sum owed by such Non-Curing Party to the party entitled to such payment and/or (c)enter upon the Landscape Areas (and upon the Development Parcels, to the extent reasonably necessary to enforce its rights hereunder)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/or perform any obligation of such Non-Curing Party under this Agreement to be performed. Such Non-Curing Party shall pay to the City, within thirty (30) calendar days of written demand by City (which demand is accompanied by appropriate supporting documentation), an amount equal to all costs and expenses incurredby City in undertaking any of the actions permitted by the preceding sentence, including without limitation, third party costs and City hourly wages and benefits reasonably allocable to the time expended by City in taking 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 by the City. Each Association shall have the rights under its Association Declaration to pursue any remedy against any Owner if thedefault is caused by such Owner, its Representatives, or its permittees and is hereby authorized (but not required unless the default is preventing the Association from performing its obligations or paying sums due under this Agreement or if the City so requires the Association to pursue its remedies, in which case the Association is required to exercise such rights and remedies to the extent necessary to cause cure of any such default). The rights and remedies given to City by this Agreement shall be deemed to be cumulative 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 Flight at Tustin -Landscape Installation and -11- SMRH:479631902.24Maintenance Agreement 06131725WR-246894 exercise of one such right or remedy by any City shall not impair the City'sstanding to exercise any other right or remedy; provided however that the City expressly waives, releases and relinquishes any and all rights to an expectation, anticipation, indirect, consequential, exemplary or punitive damages.In no event shall the City have any responsibility for any liens that may be filed as a result of the work performed by the City hereunder. It shall be the responsibility of the Non-Curing Party to remove or cause the removal of any liens for work performed by the City hereunder provided thatif the Non-Curing Party isthe Responsible Association, then the Responsible Associationshall, for the benefit of the City,pursue its remedies under the applicable Association Declaration against any Association or Owner responsible for the lien having being filed by the City. Enforcement by Associations and the City 10.2.Violation or breach of any covenant, agreement or provision contained herein shall giveto any Association and to the City the right to prosecute a proceeding at law or in equity against the person or persons who violated or are attempting to violate any such covenant, agreement or provision, to enjoin or prevent them from doing so, to causesuch violation to be remedied and/or to recover damages for such violation; provided however that any and all rights to any expectation, anticipation, indirect, consequential, exemplary or punitive damages are hereby waived. Remedies for Non-Payment 10.3.If Developer or any Owner or Association is in default under this Agreement and any Association incurs any costs and expenses as a result therefor, including as a result of the exercise by the City of its rights and remedies under this Agreement, such costs and expenses incurred by the Association shall be paid to the Association as and when required under the applicable Association Declaration and if such assessments are not paid when due, the applicable Association may pursue, or if the City so requires or if the default is preventing the Association from performing its obligations or paying sums due under this Agreement, the Association shall pursue its remedies under its Association Declaration and failure to do so shall be a default by such Association under this Agreement. Each Owner shall cooperate with the Association and take such actions as are required under the Association Declaration to cause the Association to pursue its remedies and to provide sufficient funding to satisfy the Association's payment obligations under this Agreement. Notices 11.. 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 City, the applicable Association or Owner; (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 Owner, the City orthe applicable Association 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, United Parcel Service and U.S. Postal Service are deemed approved by the Parties), postage prepaid, addressed to the Owner, the City or the applicable Association to whom notice is being sent as set forth below with next-business- day delivery guaranteed, provided that the sending party receivesa 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 Section11other 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 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 dayif 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: Flight at Tustin -Landscape Installation and -12- SMRH:479631902.24Maintenance Agreement 06131725WR-246894 Phase2 Owner:Jeffrey C. Parker, City Manager City of Tustin 300 Centennial Way Tustin, CA 92780 Fax: (714) 838-1602 Email: jparker@tustinca.org With a copy to:David Kendig Woodruff Spradlin&Smart, APC 555 Anton Boulevard, #1200 Costa Mesa, CA 92626 Fax: (714) 415-1183 Email: dkendig@wss-law.com Developer:David Binswanger and Matt Howell Flight Venture LLC c/o Lincoln Property Company Commercial, Inc. 915 Wilshire Boulevard, Suite2050 LosAngeles, CA 90017 Fax: (213) 538-0901 Email: dbinswanger@lpc.comand matt.howell@lpc.com With a copy to:Parke Miller Lincoln Property Company Commercial, Inc. 114 Pacifica, Suite370 Irvine, CA 92618 Fax: (949) 333-2131 Email: pmiller@lpc.com With a copy to:Gregory S. Courtwright Lincoln Property Company Commercial, Inc. 2000 McKinney Avenue, Suite1000 Dallas, TX 75201 Fax: (214) 740-3460 Email: gcourtwright@lpc.com With a copy to:Mark Potter Alcion Ventures One Post Office Square, Suite3150 Boston, MA 02109 Fax: (617) 603-1001 E-mail: mpotter@alcionventures.com With a copy to:Amy Forbes and Douglas Champion Gibson, Dunn&Crutcher LLP 333 South Grand Avenue, Suite4900 LosAngeles, CA 90071 Fax: (213) 229-6151 / (213) 229-6128 E-mail: aforbes@gibsondunn.com/ dchampion@gibsondunn.com Flight at Tustin -Landscape Installation and -13- SMRH:479631902.24Maintenance Agreement 06131725WR-246894 With a copy to:Andrew C. Sucoff Goodwin Procter LLP 100 Northern Ave. Boston, MA 02210 Fax: (617) 523-1231 Email: asucoff@goodwinlaw.com Any party may by written notice to the other party in the manner specified in this Agreement change the address to which notices to such party shall be delivered; provided that notwithstanding any other provision of this Agreement to the contrary, City shall be entitled to deliver notices to any Association then formed to the address for such Association contained in the Association Declaration or amendment theretolast recordedin the Official Records and no change to the name or address of any Association shall be deemed effective or binding on the City unless it is contained in a recorded Declaration or amendment thereof with a copy delivered to the City Clerk and to the City in accordance with this Section11,or if no address is specified to the person delegated as the agent for service of process for the applicable Association. Estoppel Certificate 12.. Issuance by Owners and Associations 12.1.Each Owner and each Association hereby covenants that within ten (10)business days of the written request of any other party or the City it will issue to such requesting person an Estoppel Certificate stating: (a)whether the party to whom the request has been directed knows of any default under 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, then stating the nature thereof); and (c)whether to the party's knowledge this Agreement is as of that date in full force and effect. Issuance by City 12.2. From and after the termination of the DDA as to any Landscape Area (including by issuance of by the City of a Certificate ofCompliance with respect to such Development Parcel) (it being understood that prior to such termination, the provisions of Section2.2.6of the DDA shall govern City estoppels), the City, hereby covenants that within ten (10)business days of the written request of any other party, issued not more than annually or more often only in connection with a transfer by the requesting party of its interest in any Lot, that it shall issue to the party making the request an estoppel certificate stating: (a)whetherthe party to whom the request has been directed knows of any default or Event of Default under this Agreement and if there are known defaults or Events of Default specifying the nature thereof; (b)whether to its knowledge this Agreement has been assigned, modified, or amended in any way (and if it has, then stating the nature thereof); and (c)whether to the party's knowledge this Agreement is as of that date is in full force and effect. Excuse for Non-Performance 13.. The City and each Owner and each Association 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, including, without limitation, inclement weather, 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 ormilitary authorities. Effect on Third Parties 14.. Except as herein specifically provided, no rights, privileges or immunities conferred upon the City, each Association and each Owner under this Agreement shall inure to the benefit of any other person or entity nor shall any other person or entity be deemed to be a third party beneficiary of any of the provisions contained herein. Flight at Tustin -Landscape Installation and -14- SMRH:479631902.24Maintenance Agreement 06131725WR-246894 Third Party Beneficiary. 15.The City is intended as a third party beneficiary of this Agreement regardless of whether the City ownsany portion of the Phase2 Parcel or the Perimeter Landscape Area. Entire Agreement 16.. This Agreement constitutes the entire agreement between the parties hereto pertaining to the subject matter hereof, and the 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. Amendment; Modification 17.. This Agreement may be amended or modified solely with the prior consent of (a)the Cityas the owner of all or any portion of Phase2, and following its conveyance of its interests in the Phase2 Parcel, in its governmental capacity, (b)prior to the assignment by Developer of itsobligations under this Agreement to Flight Association or any other Association pursuant to Section26, Developer, and following such assignment, such Association and to the extent Developer has not assigned all of its obligations, Developer, and (c)prior to the assignment by the Owner of the Phase2 Parcel of its obligations under this Agreement to an Association pursuant to Section26, such Owner, and following any assignment by the Owner of Phase2 Parcel or any Successor Owner of Phase2 to an Association, such Association and to the extent the Owner of the Phase2 Parcel has not assigned all of its obligations hereunder, the Ownerof the Phase2 Parcel, each in its sole discretion. Except as set forth in Section5, any change, modification, amendmentor rescission which is made without the written consent of the applicable parties listed above shall be null and void and of no effect. No consent or approval of any Owner other than those parties described in the first sentence of this Section17shall be required in order to modify or amend any provisions of this Agreement. Such amendment shall be recorded in the office of the county recorder of Orange County, State of California. Cooperation. 18.If the Phase2 Transfer Date occurs, the Master Association, the Flight Association, the City, the Phase2 Owner and Phase2 Association shall reasonably cooperate with each other to make any modifications to this Agreement as may be required to reflect the developmentplan for the Phase2 Parcel but in no event shall the Owner of the Phase1 Parcel or the Flight Association or any Owner of a Lot within the Phase1 Parcel have any obligation for any costs of installation of any Landscape Improvements related to such initial installation so long as such improvements are not Minimum Horizontal Improvements as such term is defined in, and as required by the DDA. Subdivision. 19.In the event thateither the Phase1 Parcel or the Phase2 Parcel should be further subdivided, the rights and privileges appurtenant to any such property granted herein shall inure to the benefit of all subdivided or separate portions thereof, and the covenants and obligations burdening any such property shall burden all of the subdivided portions thereof. Severability 20.. 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 bya 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. Governing Law 21.. 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. Waiver and Default 22.. The waiver by anOwner, any Association, and/or the Cityof 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. References to Sections, Clauses and Exhibits 23.. Unless otherwise indicated, references in this Agreement to sections, clauses and exhibits are to the same contained in or attached to this Agreement and all exhibits referenced in this Agreement are incorporated in this Agreement by this reference as though fully set forth in this Section23. All depictions on Exhibit"A-1"and Exhibit"C"are Flight at Tustin -Landscape Installation and -15- SMRH:479631902.24Maintenance Agreement 06131725WR-246894 attached as pictorial illustrations of the approximate locations of certain areas within the Landscape Areas. In the event of any conflict between the pictorial illustrations on Exhibit"A-1"and/or Exhibit"C", the actual as-built locations shall control. Counterparts 24.. 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. Runs With the Land; Release and Termination 25.. This Agreement and the agreements, rights, covenants,conditions contained herein (other than the licensesdescribed in Sections2.1and 2.2, which shall be terminable by the City in accordance with Section5) shall constitute equitable servitudes and covenants running with the land comprising the Development Parcels and the Perimeter Landscape Parcels Area (collectively, the "") and each and every portion thereofand shall be binding upon or inure to the benefit of (as the case may require) the parties hereto, and their respective heirs,successors,and assigns who become owners of the Parcels or any one thereof from time to time, and all other persons acquiring their respective Parcels or any part thereof, whether by operation of law or in any other manner whatsoever and shall continue to be imposed upon the Parcels and each portion thereof as a servitude in favor of each and every other portion of the Parcels, as the dominant tenement or tenements, as the case may be. All references in this Agreement to "Owner" shall include their respective heirs, representatives, successors and assigns owning fee title to or holding a Ground Lease interest in all or any portion of the Development Parcels and all references to "City" shall include the Governmental Successors of City with respect to the Phase2 Parcel and its representatives, successors and assigns owing all or any portion of the Perimeter Landscape Area.This Agreement and all the terms, covenants and conditions herein contained shall be enforceable as equitable servitudes in favor of the Perimeter Landscape Area and any portion thereof and the Development Parcels. Assignment 26.. Developershall have the right to assign its duties, obligations and liabilities under this Agreement to the Responsible Associationeither in full or with respect to certain phases or portions of the Landscape Areas upon completion of initial installation of the Landscape Improvements in such Landscape Areas. If the Phase2 Transfer Date occurs and the Responsible Association is the Flight Association, theFlight Association shall assign its duties, obligations and liabilities with respect to the Landscape Areas under this Agreement to the Master Association,and the Master Association shall assume such obligations under this Agreementunless the City and the Members (as defined in the Master Declaration) unanimously determine that the Phase2 Association shall be the Responsible Association with respect to the Phase2 Landscape Area and the portion of the Perimeter Landscape Area adjacent to the Phase2 LandscapeArea and that Flight Association shall remain the Responsible Association for maintenance of the Phase1 Landscape Area and the portions of the Perimeter Landscape Area adjacent to the Phase1 Landscape Area regardless of the occurrence of the Master Association Incorporation Date or the Phase2 Transfer Date, in which event Flight Association shall retain all of its duties, obligations and liabilities with respect to the Phase1 Landscape Area and the portion of the Perimeter Landscape Area adjacent to the Phase1 Landscape Area and shall assign its duties, obligations and liabilities with respect to the Phase2 Landscape Area and the portion of the Perimeter Landscape Area adjacent to the Phase2 Landscape Area under this Agreement to the Phase2Association,and the Phase2Association shall assume such obligations under this Agreement. If the City exercises its rights to incorporate the Master Association as a result of aFlight Association Event of Default (as defined in the Master Declaration), then all of the duties, obligations and liabilities of the Responsible Associationwith respect to the Landscape Areas shall be automatically assigned to and shall be assumed by the Master Association.Prior to any assignment by the Developerto a Responsible Association, each of the Owners hereunder shall have joint and several liability for the obligations under this Agreement[[583,2654,659,2702][10][,I,][Arial]]. [[625,2654,2300,2701][10][,,][Arial]]So long as the Association to which the rights and obligations hereunder are assigned has the power to perform the obligations hereunder including the power to levy liens pursuant to its Association Declaration and has the duty and the power, on behalf of itself and the City to enforce the performance and payment obligations hereunder and so long as 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 Responsible Partyof the obligations and liabilities under this Agreement with respect to such portions Flight at Tustin -Landscape Installation and -16- SMRH:479631902.24Maintenance Agreement 06131725WR-246894 Assignment Agreement of the Landscape Areas arising from and after the date of the assignment ("") then, in such case the assigning Owner with respect to any assignment to the Responsible Association, and the Flight Association (if it has been assigned the obligations hereunder by the Developer)or the Phase2 Association with respect to anassignmentto theMaster Association (if applicable) except as otherwise specifically set forth herein shall be released from any and all obligations and liabilities under [Remainder of PageIntentionally Left Blank] Flight at Tustin -Landscape Installation and -17- SMRH:479631902.24Maintenance Agreement 06131725WR-246894 this Agreement arisingoraccruingunder this Agreement from and after the effective date of the applicable assignment with respect to those portions of the Landscape Areas and Landscape Improvementsand 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. CITY OF TUSTIN: By: Jeffrey C. Parker, City Manager ATTEST: By:______________________________ Erica N. Rabe City Clerk APPROVED AS TO FORM By: David Kendig, City Attorney Armbruster Goldsmith&Delvac LLP Special Real Estate Counsel to the City By: Amy E. Freilich [[911,2252,1671,2300][10][,I,][Arial]]{signatures continue on following page} DEVELOPER: Flight PhaseI Owner, LLC, a Delaware limited liability company By: Name: Authorized Signatory: Flight at Tustin -Landscape Installation and -18- SMRH:479631902.24Maintenance Agreement 06131725WR-246894 ACKNOWLEDGMENT A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. State of California) County of ) On _________________, before me, ________________________________, Notary Public, 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 paragraphis true and correct. WITNESS my hand and official seal. Signature:(Seal) Flight at Tustin -Landscape Installation and SMRH:479631902.24Maintenance Agreement 06131725WR-246894 ACKNOWLEDGMENT A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. State of California) County of ) On _________________, before me, ________________________________, Notary Public, personally appeared ________________________, whoproved 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 paragraphis true and correct. WITNESS my hand and official seal. Signature:(Seal) Flight at Tustin -Landscape Installation and SMRH:479631902.24Maintenance Agreement 06131725WR-246894 ACKNOWLEDGMENT A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. State of California) County of ) On _________________, before me, ________________________________, Notary Public, personally appeared ________________________, who proved to me on the basis ofsatisfactory 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 paragraphis true and correct. WITNESS my hand and official seal. Signature:(Seal) Flight at Tustin -Landscape Installation and SMRH:479631902.24Maintenance Agreement 06131725WR-246894 ACKNOWLEDGMENT A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, orvalidity of that document. State of California) County of ) On _________________, before me, ________________________________, Notary Public, 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 paragraphis true and correct. WITNESS my hand and official seal. Signature:(Seal) Flight at Tustin -Landscape Installation and SMRH:479631902.24Maintenance Agreement 06131725WR-246894 ACKNOWLEDGMENT A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. State of ) County of ) On _________________, before me, ________________________________, Notary Public, personally appeared ________________________, who proved to me on the basis of satisfactory evidence to be the person(s)whose name(s)is/aresubscribed 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 paragraphis true and correct. WITNESS my hand and official seal. Signature:(Seal) Flight at Tustin -Landscape Installation and SMRH:479631902.24Maintenance Agreement 06131725WR-246894 LIST OF EXHIBITS Exhibit"A"............................................................Legal Description of Phase1 Parcel and Phase2 Parcel Exhibit"A-1"................................................................................Depiction of Phase1 and Phase2 Parcel Exhibit"B".......................................................................................Legal Description of City ROW Property Exhibit"C".....................................................................................................Depiction of Landscape Areas Flight at Tustin -Landscape Installation and SMRH:479631902.24Maintenance Agreement 06131725WR-246894 EXHIBIT "A" LEGAL DESCRIPTION OF PHASE 1 PARCEL ANDPHASE 2 PARCEL PARCEL 1 : Legal Description (Phase 1) Real property in the City of Tustin, County of Orange, State of California, described as follows: LOTS 1 THROUGH 10, INCLUSIVE, OF TRACT NO. 18082, AS SHOWN BY TRACT MAP ON FILE IN BOOK _____, PAGES _____, INCLUSIVE, OF TRACT MAPS, RECORDS OF ORANGE COUNTY, CALIFORNIA. EXCEPTING THEREFROM ANY AND ALL OIL, OIL RIGHTS, MINERALS, MINERAL RIGHTS, NATURAL GAS, NATURAL GAS RIGHTS AND OTHER HYDROCARBONS BY WHATSOEVER NAME KNOWN, GEOTHERMAL STEAM AND ALL PRODUCTS DERIVED FROM ANY OF THE FOREGOING THAT MAY BE WITHIN OR UNDER THE LAND, TOGETHER WITH THE PERPETUAL RIGHT OF DRILLING, MINING, EXPLORING FOR AND STORING IN AND REMOVING THE SAME FROM THE LAND OR ANY OTHER LAND, INCLUDING THE RIGHT TO WHIPSTOCK OR DIRECTIONALLY DRILL AND MINE FROM LANDS OTHER THAN THE LAND, OIL OR GAS WELLS, TUNNELS AND SHAFTS INTO, THROUGH OR ACROSS THE SUBSURFACE OF THE LAND 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 LAND IN THE EXERCISE OF SUCH RIGHTS OR OTHERWISE ADVERSELY AFFECT THE USE OR OPERATION OF THE LAND OR THE STRUCTURAL INTEGRITY OF ANY IMPROVEMENTS ON THE LAND, AS RESERVED IN THE QUITCLAIM DEED FROM THE CITY OF TUSTIN, CALIFORNIA, RECORDED ________, 2017 AS INSTRUMENT NO. __________________ OF OFFICIAL RECORDS. ALSO EXCEPTING THEREFROM ANY AND ALL WATER, WATER RIGHTS OR INTERESTS THEREIN APPURTENANT OR RELATING TO THE LAND OR OWNED OR USED BY THE GRANTOR IN CONNECTION WITH OR WITH RESPECT TO THE LAND NO MATTER HOW ACQUIRED BY THE GRANTOR, 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 LAND, TO STORE THE SAME BENEATHTHE SURFACE OF THE LAND AND TO DIVERT OR OTHERWISE UTILIZE SUCH WATER, RIGHTS OR INTERESTS ON ANY OTHER PROPERTY OWNED OR LEASED BY GRANTOR; BUT WITHOUT, HOWEVER, THE RIGHT TO ENTER UPON OR USE THE SURFACE OF THE LAND IN THE EXERCISE OF SUCH RIGHTS OR OTHERWISE Flight at Tustin -Landscape Installation and EXHIBIT "A" SMRH:479631902.24Maintenance Agreement 061317-1-25WR-246894 ADVERSELY AFFECT THE USE OR OPERATION OF THE LAND OR THE STRUCTURAL INTEGRITY OF ANY IMPROVEMENTS ON THE LAND, AS RESERVED IN THE QUITCLAIM DEED FROM THE CITY OF TUSTIN, CALIFORNIA, RECORDED ___________, 2017 AS INSTRUMENT NO. _______________ OF OFFICIAL RECORDS. PARCEL 2 : Legal Description (Phase 2) Real property in the City of Tustin, County of Orange, State of California, described as follows: PARCEL 2 OF PARCEL MAP NO. 2015-168, AS SHOWN ON A MAP FILED IN BOOK 388, PAGES 26 AND 27 OF PARCEL MAPS, RECORDS OF ORANGE COUNTY, CALIFORNIA; EXCEPTING THEREFROM ANY AND ALL OIL, OIL RIGHTS, MINERALS, MINERAL RIGHTS, NATURAL GAS, NATURAL GAS RIGHTS AND OTHER HYDROCARBONS BY WHATSOEVER NAME KNOWN, GEOTHERMAL STEAM AND ALL PRODUCTS DERIVED FROM ANY OF THE FOREGOING THAT MAY BE WITHIN OR UNDER THE LAND, TOGETHER WITH THE PERPETUAL RIGHT OF DRILLING, MINING, EXPLORING FOR AND STORING IN AND REMOVING THE SAME FROM THE LAND OR ANY OTHER LAND, INCLUDING THE RIGHT TO WHIPSTOCK OR DIRECTIONALLY DRILL AND MINE FROM LANDS OTHER THAN THE LAND, OIL OR GAS WELLS, TUNNELS AND SHAFTS INTO, THROUGH OR ACROSS THE SUBSURFACE OF THE LAND 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 LAND IN THE EXERCISE OF SUCH RIGHTS OR OTHERWISE ADVERSELY AFFECT THE USE OR OPERATION OF THE LAND OR THE STRUCTURAL INTEGRITY OF ANY IMPROVEMENTS ON THE LAND. ALSO EXCEPTING THEREFROM ANY AND ALL WATER, WATER RIGHTS OR INTERESTS THEREIN APPURTENANT OR RELATING TO THE LAND OR OWNED OR USED BY THE GRANTOR IN CONNECTION WITH OR WITH RESPECT TO THE LAND NO MATTER HOW ACQUIRED BY THE GRANTOR, 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 LAND, TO STORE THE SAME BENEATH THE SURFACE OF THE LAND AND TO DIVERT OR OTHERWISE UTILIZE SUCH WATER, RIGHTS OR INTERESTS ON ANY OTHER PROPERTY OWNED OR LEASED BY GRANTOR; BUT WITHOUT, HOWEVER, THE RIGHT TO ENTER UPON OR USE THE SURFACE OF THE LAND IN THE EXERCISE OF SUCH RIGHTS OR OTHERWISE Flight at Tustin -Landscape Installation and EXHIBIT "A" SMRH:479631902.24Maintenance Agreement 061317-2-25WR-246894 ADVERSELY AFFECT THE USE OR OPERATION OF THE LAND OR THE STRUCTURAL INTEGRITY OF ANY IMPROVEMENTS ON THE LAND. Flight at Tustin -Landscape Installation and EXHIBIT "A" SMRH:479631902.24Maintenance Agreement 061317-3-25WR-246894 EXHIBIT "A-1" DEPICTION OF PHASE 1 AND PHASE 2 PARCEL [See Attached] All items and location of items are shown for informational purposes only and should not be relied upon for content, precise design or dimension. The actual conditions will control. The attached plan is for illustrative purposes only and depicts approximate dimensions. Flight at Tustin -Landscape Installation and EXHIBIT "A-1" SMRH:479631902.24Maintenance Agreement 061317-1-25WR-246894 Flight at Tustin -Landscape Installation and EXHIBIT "A-1" SMRH:479631902.24Maintenance Agreement 061317-2-25WR-246894 EXHIBIT "B" LEGAL DESCRIPTION OF CITY ROW PROPERTY [See Attached] Flight at Tustin -Landscape Installation and EXHIBIT "B" SMRH:479631902.24Maintenance Agreement 061317-1-25WR-246894 Flight at Tustin -Landscape Installation and EXHIBIT "B" SMRH:479631902.24Maintenance Agreement 061317-2-25WR-246894 Flight at Tustin -Landscape Installation and EXHIBIT "B" SMRH:479631902.24Maintenance Agreement 061317-3-25WR-246894 Flight at Tustin -Landscape Installation and EXHIBIT "B" SMRH:479631902.24Maintenance Agreement 061317-4-25WR-246894 Flight at Tustin -Landscape Installation and EXHIBIT "B" SMRH:479631902.24Maintenance Agreement 061317-5-25WR-246894 Flight at Tustin -Landscape Installation and EXHIBIT "B" SMRH:479631902.24Maintenance Agreement 061317-6-25WR-246894 Flight at Tustin -Landscape Installation and EXHIBIT "B" SMRH:479631902.24Maintenance Agreement 061317-7-25WR-246894 Flight at Tustin -Landscape Installation and EXHIBIT "B" SMRH:479631902.24Maintenance Agreement 061317-8-25WR-246894 Flight at Tustin -Landscape Installation and EXHIBIT "B" SMRH:479631902.24Maintenance Agreement 061317-9-25WR-246894 Flight at Tustin -Landscape Installation and EXHIBIT "B" SMRH:479631902.24Maintenance Agreement 061317-10-25WR-246894 EXHIBIT "C" DEPICTION OF LANDSCAPE AREAS [See Attached] All items and location of items are shown for informational purposes only and should not be relied upon for content, precise design or dimension. The actual conditions will control. The attached plan is for illustrative purposes only and depicts approximate dimensions. Flight at Tustin -Landscape Installation and EXHIBIT "C" SMRH:479631902.24Maintenance Agreement 061317-1-25WR-246894 Flight at Tustin -Landscape Installation and EXHIBIT "C" SMRH:479631902.24Maintenance Agreement 061317-2-25WR-246894 Flight at Tustin -Landscape Installation and EXHIBIT "C" SMRH:479631902.24Maintenance Agreement 061317-3-25WR-246894