HomeMy WebLinkAboutPC RES 4060RESOLUTION NO. 4060
A RESOLUTION OF THE PLANNING COMMISSION OF
THE CITY OF TUSTIN, CALIFORNIA, RECOMMENDING
THAT THE CITY COUNCIL APPROVE DEVELOPMENT
AGREEMENT 06-002, AS DEFINED BY SECTION 65865.2
OF THE CALIFORNIA GOVERNMENT CODE, BETWEEN
THE CITY OF TUSTIN AND TUSTIN LEGACY COMMUNITY
PARTNERS, LLC. (THE DEVELOPER), A DELAWARE
LIMITED LIABILITY COMPANY PERTAINING TO
DEVELOPMENT OF THE PROPERTY LOCATED WITHIN
PLANNING AREAS 7-15 OF THE MCAS TUSTIN SPECIFIC
PLAN, TUSTIN, CALIFORNIA.
The Planning Commission of the City of Tustin does hereby resolve as follows:
The Planning Commission finds and determines:
A. That Development Agreement (DA) 06-002 is proposed by Tustin Legacy
Community Partners, LLC. (the Developer), a Delaware limited liability
company;
B. That to strengthen the public planning process, encourage private
participation in comprehensive planning, and reduce the economic risk of
development, the California Legislature adopted the Development
Agreement Statute of the Government Code. Pursuant to the Statute, the
City may enter into an agreement with any person having a legal or
equitable interest in real property and to provide for the development of
such property and to establish certain development rights therein.
C. That the purpose of Development Agreement 06-002 is to give the
developer certain assurances that in return for Developer's commitment to
the comprehensive planning for the Property that is contained in the
Disposition and Development Agreement (DDA) and the Specific Plan, the
City will in turn remain committed to the DDA and the Specific Plan;
D. That the development and use of the Project in the future will provide
significant benefits to the community and promote the public health,
safety, and welfare for the following reasons, among others: (i)
development of the Project will generate tax revenues that can be used to
provide essential services to the community; (ii) development will put the
Property to productive use consistent with the objectives of the City's
General Plan and the MCAS Tustin Specific Plan; and (iii) development of
the Project will provide a long term source of employment opportunities for
local residents.
Resolution No. 4060
Page 2
E. That a public hearing was duly noticed, called, and held on March 27,
2007, by the Planning Commission, and the Planning Commission
continued DA 06-002 to April 10, 2007, Planning Commission hearing.
F. That a public hearing was duly noticed, called, and held on April 10, 2007,
by the Planning Commission, and the Planning Commission
recommended that the City Council approve Development Agreement 06-
002.
G. That on January 16, 2001, the City of Tustin certified the Program Final
Environmental Impact Statement/Environmental Impact Report (FEIS/EIR)
for the reuse and disposal of MCAS Tustin. On April 3, 2006, the City
Council adopted Resolution No. 06-43 approving an Addendum to the
Final Environmental Impact Statement/Environmental Impact Report for
the Disposal and Reuse of MCAS Tustin. The FEIS/EIR and its
Addendum is a program EIR under the California Environmental Quality
Act ("CEQA"). The FEIS/FEIR and its Addendum considered the potential
environmental impacts associated with development on the former Marine
Corps Air Station, Tustin;
H. The City prepared a comprehensive Environmental Checklist for the
Disposition and Development Agreement Amendment, DA 06-002 and
Zone Change 07-001 for the proposed project, attached hereto as Exhibit
A. The Environmental Checklist concluded that the proposed project does
not result in any new significant environmental impacts, substantial changes
or a substantial increase in the severity of any previously identified
significant impacts in the FEIS/EIR and Addendum. Moreover, no new
information of substantial importance has surfaced since certification of the
FEIS/EIR and Addendum.
That DA 06-002 is consistent with the objectives, policies, general land
uses, and programs specified in the Tustin General Plan, in that the
proposed project would implement the adopted MCAS Tustin Specific Plan.
J. That DA 06-002 is compatible with the uses authorized in the district in
which the real property is located in that the Developer intends to develop
the Property for residential and non-residential uses consistent with the
MCAS Tustin Specific Plan district regulations.
K. That DA 06-002 is in conformity with the public necessity, public
convenience, general welfare, and good land use practices in that the
proposed project would implement both the General Plan and the MCAS
Tustin Specific Plan goals and objectives.
L. That DA 06-002 will not be detrimental to the health, safety, and general
welfare in that the proposed development would comply with all applicable
Federal, State, and Local rules and regulations.
Resolution No. 4060
Page 3
M. That DA 06-002 will not adversely affect the orderly development of
property in that the proposed development would comply with the MCAS
Tustin Specific Plan district regulations.
N. That DA will have a positive fiscal impact on the City in that development of
the Project will generate significant tax revenues that can be used to
provide essential services to the community.
II. The Planning Commission hereby recommends that the City Council approve DA
06-002 as included in Exhibit 1 attached hereto and subject to final approval of
the City Attorney.
PASSED AND ADOPTED by the Planning Commission of the City of Tustin at a regular
meeting held on the 10~' day of April, 2007.
ELIZABETH A. BINSACK
Planning Commission Secretary
STATE OF CALIFORNIA )
COUNTY OF ORANGE ) SS
CITY OF TUSTIN )
BR FLOYD
Chairperson
I, ELIZABETH A. BINSACK, the undersigned, hereby certify that I am the Planning
Commission Secretary of the Planning Commission of the City of Tustin, California; that
Resolution No. 4060 was duly passed and adopted at the regular meeting of the Tustin
Planning Commission, held on the 10th day of April, 2007.
~l ~ .(Z
ELIZABETH A. BI SACK
Planning Commission Secretary
Exhibit 1 of Resolution No. 4060
_ r r _ .,.~
CITY OF TUSTIN OFFICIAL BUSINESS
REQUEST DOCUMENT BE RECORDED
AND BE EXEMPT FROM PAYMENT OF
A RECORDING FEE PER
GOVERNMENT CODE 6103 AND 27383
RECORDING REQUESTED BY AND
WHEN RECORDED MAIL TO:
City of Tustin
300 Centennial Way
Tustin, California 92780
Attn: City Clerk
Space above this line for Recorder's Use
TUSTIN LEGACY DEVELOPMENT AGREEMENT
THIS TUSTIN LEGACY DEVELOPMENT AGREEMENT ("Agreement") is
entered into effective as of the _ day of , 2007 by and between the CITY OF
TUSTIN, a California municipal corporation ("CITY"), and TUSTIN LEGACY
COMMUNITY PARTNERS, LLC, a Delawaze limited liability company ("DEVELOPER").
CITY and DEVELOPER aze collectively referred to herein as the "Parties" and individually as a
«P~y>,
RECITALS
A. To strengthen the public planning process, encourage private participation in
comprehensive planning, and reduce the economic risk of development, the Legislature of the
State of California adopted the "Development Agreement Statute," Sections 65864, et seq., of
the Government Code. The Development Agreement Statute authorizes CITY to enter into an
agreement with any person having a legal or equitable interest in real property and to provide for
development of such property and to establish certain development rights therein. Pursuant to
the authorization set forth in the Development Agreement Statute, CITY has enacted procedures
for entering into development agreements which are contained in Tustin City Code Sections
9600 to 9619.
B. CITY, Tustin Public Financing Authority (the "Authority"), and DEVELOPER
entered into that certain Tustin Legacy Disposition and Development Agreement as of May 3,
2006 (the "DDA") pursuant to which CITY agreed to sell, and DEVELOPER agreed to buy and
develop, certain real property, all as more specifically set forth in the DDA.
533339.15333391
533339.1
C. Pursuant to the DDA, DEVELOPER has an equitable interest in the Property (as
defined below) in that it has the contractual right to purchase from CITY for development, in
phases, the Property.
D. Pursuant to Section 1.7 of the DDA, CITY agreed to consider a future application
by DEVELOPER for a development agreement in accordance with Section 65864, et seq. of the
Government Code.
E. DEVELOPER has requested CITY to enter into a development agreement and
procedures have been taken in accordance with the rules and regulations of CITY.
F. Some of the public improvements and dedications to be provided as part of the
DDA and the Specific Plan, while necessary to serve the private development of the Property,
aze also needed to serve the ultimate development of the Tustin Legacy according to the General
Plan and Specific Plan . Given the significance of some of these public improvements, CITY
has required DEVELOPER to assist in providing these public improvements pursuant to the
DDA in early phases of the development of the Property prior to the time they would otherwise
be required and also as necessary as an eazly investment by the DEVELOPER as an off-set
against land value payments that would have otherwise been required by the DEVELOPER.
DEVELOPER is also willing to assist in providing public improvements whose capacities
exceed the needs created solely by the development of the Property. DEVELOPER is willing to
assist in providing these public improvements eazlier than otherwise required for its private
development of the Property, and to ultimate sizes, only upon the assurance of CITY that
DEVELOPER will be able to complete its private development at least at the total density and
intensity of use set forth in the DDA and the Specific Plan. In this respect, the public
improvements and dedications called for as part of the DDA and the Specific Plan, together with
the private development portions at the ultimate density and intensity of use set forth in the DDA
and the Specific Plan, are dependent on one another, and together comprise an indivisible
project.
G. In accordance with the legislative findings set forth in Government Code
Section 65864, CITY wishes to attain certain public objectives that will be furthered by this
Agreement. This Agreement will provide for the orderly implementation of the General Plan of
CITY, and the phased development and completion of the Project in accordance with the DDA
and the Specific Plan. This Agreement will further a comprehensive planning objective
contained within the City's General Plan, which is:
"To promote an economically balanced community with complimentazy and
buffered land uses to include industrial, commercial, professional, multi-family and
single-family development."
H. The DDA, the Specific Plan and the development under the DDA and the Specific
Plan require a substantial early investment of money and planning and design effort by
DEVELOPER. Without the protection provided by this Agreement, uncertainty that the Project
may be completed in its entirety could result in a waste of public resources, escalate the cost of
public improvements, and discourage DEVELOPER's participation in the comprehensive traffic,
drainage, and other public improvements in the DDA and the Specific Plan. DEVELOPER'S
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533339.1
participation in the implementation of the DDA and the Specific Plan will result in a number of
public benefits. These benefits require the cooperation and participation of CITY and
DEVELOPER and could not be secured without mutual cooperation in and commitment to the
comprehensive planning effort that has resulted in the DDA and the Specific Plan.
I. DEVELOPER wishes to avoid certain development risks and uncertainties that
would, in the absence of this Agreement, deter and discourage DEVELOPER from making a
long-term commitment to implement the DDA and the Specific Plan. These aze as follows:
L It is generally the law in California that, absent extraordinary
circumstances or the approval of a vesting subdivision map, an owner of the land does not obtain
a vested right to improve land until the issuance of a building permit for the improvements and
commencement of substantial construction pursuant to that permit. The result is a disincentive
for landowners to invest monies in the eazly completion of major infrastructure and other public
improvements as part of any project or in early comprehensive planning and design studies.
2. Development under the DDA and the Specific Plan requires a substantial
eazly investment of money and planning and design effort by DEVELOPER. Uncertainty about
CITY's land use policies, rules and regulations could result in a waste of private resources,
escalate the cost of required public improvements, and escalate costs of proposed housing and
other uses.
J. The following assurances are of vital concern to DEVELOPER to offset or
remove the disincentives and uncertainties set forth in Paragraph J above:
1. Assurance to DEVELOPER that, in return for DEVELOPER's
commitment to the comprehensive planning for the Property that is contained in the DDA and
the Specific Plan, CITY will in turn remains committed to the DDA and the Specific Plan;
2. Assurances to DEVELOPER that as DEVELOPER becomes obligated for
the costs of designing and constructing the public improvements included in the DDA and the
Specific Plan, and makes dedications, DEVELOPER will become entitled to complete the
private development portions of the DDA and the Specific Plan that justify those obligations; and
3 Assurances to DEVELOPER that in CITY's administration of the DDA
and the Specific Plan, DEVELOPER will be allowed, consistent with the DDA and the Specific
Plan, to respond to the mazketplace in terms of housing types and intensities, the development of
mixed uses, and reconfiguration of land uses, so long as in so doing overall intensity and density
of development, and the range of uses within sectors identified in the DDA and the Specific Plan
aze not exceeded. These assurances provide for cooperation and participation of CITY and
DEVELOPER and could not be secured without mutual cooperation in and commitment to the
comprehensive planning effort that has resulted in the DDA and the Specific Plan.
K. California Government Code Sections 65864 et seq. authorize local agencies to
enter into binding development agreements with persons having legal or equitable interests in
real property for the development of such property. CITY wishes to enter into a development
agreement with DEVELOPER to secure the public benefits described above, and DEVELOPER
533339.1
wishes to enter into a development agreement with CITY to avoid the development risks and
uncertainties and to obtain the assurances described above.
L. This Agreement is intended to be, and shall be construed as, a development
agreement within the meaning of the Development Agreement Statute. This Agreement is
intended to augment and further the purposes and intent of the parties in the implementation of
the DDA and the Specific Plan. This Agreement, as a device for the implementation of the DDA
and the Specific Plan, will eliminate uncertainty in planning for and secure the orderly
development of the Project, ensure a desirable and functional community environment, provide
effective and efficient development of public facilities, infrastructure, and services appropriate
for the development of the Project, assure attainment of the maximum effective utilization of
resources within CITY, and provide other significant public benefits to CITY and its residents by
otherwise achieving the goals and purposes of the Development Agreement Statute. In exchange
for these benefits to CITY, DEVELOPER desires to receive the assurance that it may proceed
with development of the Project in accordance with the terms and conditions of this Agreement,
Existing Land Use Regulations, the DDA, and the Development Plan, all as more particularly set
forth herein.
M. CITY has determined that this Agreement and the Project aze consistent with the
CITY's General Plan and the CITY's MCAS Tustin Specific Plan/Reuse Plan, as amended, and
as the same maybe further amended from time to time.
N. On , 2007, the Planning Commission held a public hearing on this
Agreement, made certain findings and determinations with respect thereto, and recommended to
the City Council of CITY that this Agreement be approved. On ,the City
Council held a public hearing on this Agreement, considered the recommendations of the
Planning Commission, and adopted ordinance no. _, approving this Agreement and
authorizing its execution.
AGREEMENT
NOW, THEREFORE, in consideration of the above recitals, which aze incorporated
herein by this reference, and for good and valuable consideration, the receipt and sufficiency of
which is hereby acknowledged, the Parties agree as follows:
DEFINITIONS AND EXHIBITS.
1.1. Definitions. The following terms when used in this Agreement shall be defined as
follows:
Any capitalized word or term used in this Agreement shall have the definition or
meaning ascribed to such word or term as provided in Attachment No. 5 to the DDA, unless the
word or term is expressly provided in this Section 1.1 of this Agreement, in which event such
word or term shall have the definition or meaning as provided herein.
1.1.1 "Agreement" is defined in the introductory paragraph.
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573339.1
1.1.2 "Applications" is defined in Section 3.6.2 below.
1.1.3 "Authority" is defined in the Recital B above.
1.1.4 "CITY" is defined in the introductory pazagraph.
1.1.5 "DDA" is defined in the Recital B above.
1.1.6 "DEVELOPER" is defined in the introductory pazagraph.
1.1.7 "Development Permits" means all permits, certificates and approvals
which may be required by CITY or other governmental authority for the development and
construction of the improvements for the Project, in each case in accordance with this
Agreement, the DDA, applicable Land Use Regulations and any required environmental
mitigation, including without limitation any engineering permits, grading permits, foundation
permits, construction permits and building permits.
1.1.8 "Development Plan" means the development (including, without
limitation, the Scope of Development) identified in the DDA, subject to further refinement as
required or contemplated by the DDA consistent with all applicable Entitlement Approvals and
all applicable Land Use Regulations.
1.1.9 Reserved
1.1.10 "Effective Date" means the date the CITY's ordinance approving this
Agreement becomes effective.
1.1.11 "Entitlement Approvals" means all land use approvals and entitlements,
including all conditions of approvals, legally required by CITY or any other governmental
authority as a condition of subdivision of the Property, development of the Property, and
construction of the improvements in accordance with this Agreement, the DDA and applicable
Land Use Regulations, including, without limitation, Specific Plan and Specific Plan
Amendments, Vesting Tentative and Final subdivision maps, the Concept Plans and Design
Review, and conditional use permit approvals as may be applicable for proposed specific uses(s)
in connection with development of the Property.
1.1.12 "Existing Entitlement Approvals" means all Development Permits and
Entitlement Approvals approved or issued prior to the Effective Date. Existing Entitlement
Approvals include the Development Permits and Entitlement Approvals which aze a matter of
public record on the Effective Date.
1.1.13 "Existing Land Use Regulations"-means all Land Use Regulations in
effect on the Effective Date. Existing Land Use Regulations include CITY's General Plan,
Zoning Code, the Specific Plan, and all other ordinances, resolutions, rules, and regulations of
CITY governing development and use of the Property in effect as of the Effective Date,
including without limitation the permitted uses of the Property, the density and intensity of use,
maximum height and size of proposed buildings, provisions for the reservation and dedication of
land for public purposes, and construction standazds and regulations.
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553379.1
1.1.14 "Land Use Regulations" means all laws, statutes, ordinances, resolutions, -
codes, orders, rules, regulations and official policies of CITY governing the development and use
of land, including, without limitation, the permitted uses of the Property, the density or intensity
of use, subdivision requirements, timing and phasing of development, the maximum height and
size of proposed buildings, the provisions for reservation or dedication of land for public
purposes, and the design, improvement and construction standazds and specifications applicable
to the development of the Property.
1.1.15 "LIFOC"refers to an instrument entitled "Lease in Furtherance of
Conveyance" executed by the United States Department of the Navy and dated May 13, 2002,
delivered to CITY provisionally in lieu of deed for portions of the Property impacted by
hazardous materials, which expires and is supplemented by a conveyance deed upon the United
States Department of the Navy determining that the hazazdous materials which impact a portion
of the Property have been adequately remediated.
1.1.16 "Mortgagee" means a mortgagee of a mortgage, a beneficiary under a
deed of trust or any other security-device lender, and their successors and assigns.
1.1.17 "Navy" is defined in Section 2.2 below.
1.1.18 "New CITY Laws" is defined in Section 3.5.1 below.
1.1.19 "Party" is defined in the introductory pazagraph.
1.1.20 "Project" means the development of the Property contemplated by the
Development Plan as such Development Plan may be further defined, enhanced or modified
pursuant to the provisions of this Agreement.
1.1.21 "Property" means the real property described on Exhibit "A" and shown
on Exhibit "B" to this Agreement.
1.1.22 "Reservations of Authority" means the rights and authority excepted from
the assurances and rights provided to DEVELOPER under this Agreement and reserved to CITY
under Section 3.5 of this Agreement.
1.1.23 "Specific Plan" means the CITY's MCAS Tustin Specific Plan/Reuse
Plan, as amended, and as the same maybe further amended from time to time.
1.1.24 "Subsequent Entitlement Approvals" means all Entitlement Approvals
required subsequent to the Effective Date in connection with development of the Property.
1.1.25 "Successors In Interest" means any person having a legal or equitable
interest in the whole of the Property, or any portion thereof as to which such person wishes to
amend or cancel this Agreement.
1.1.26 "Vested Right" means the vested rights granted to Developer pursuant to
this Agreement, including, without limitation, the vested right to develop the Property in
accordance with, and to the extent of the DDA and the provisions of this Agreement.
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533339.1
1.2 Exhibits.The following documents aze attached to, and by this reference made a
part of, this Agreement:
Exhibit "A"- Legal Description of the Property.
Exhibit "B" -Map showing Property and its location.
2. GENERAL PROVISIONS
2.1 Bindine Effect of Agreement. The Property is hereby made subject to this
Agreement. Development of the Property is hereby authorized and shall be carried out only in
accordance with the terms of this Agreement.
2.2 Equitable Interests in Property. Pursuant to the DDA, DEVELOPER anticipates
acquiring the Property in phases, and some of such Property may be initially acquired by
DEVELOPER through a sublease with CITY, as contemplated by the lease from CITY of such
portion of the Property from the Department of the Navy (the "Navy") pursuant to the LIFOC
between the Navy, as ground lessor, and CITY, as ground lessee. CITY and DEVELOPER
agree that DEVELOPER'S right to acquire the Property pursuant to the DDA creates a sufficient
equitable interest in order to enter into this Agreement. If DEVELOPER fails to acquire any
portion of the Property, then this Agreement shall automatically no longer be effective as to such
portion of the Property concurrently with the date upon which DEVELOPER'S rights to acquire
such portion of the Property expire. CITY and DEVELOPER expressly agree that neither the
Navy nor any other federal authority which owns fee title to any portion of the Property as of the
date of this Agreement, by reason of their ownership of such portion of the Property, aze subject
to the provisions of this Agreement, nor is their consent required for the recordation of this
Agreement, since CITY'S and DEVELOPER'S rights and obligations hereunder aze conditioned
upon conveyance of the Property and portions thereof from the Navy to CITY (to the extent not
previously so conveyed) and the subsequent acquisition of the Property or any portion thereof by
DEVELOPER from CITY pursuant to the DDA.
2.3 Term. The term of this Agreement shall commence on the Effective Date and
shall continue for a term of thirty (30) yeazs thereafter unless this term is terminated, modified,
or extended by circumstances set forth in this Agreement or by mutual written consent of the
Parties. Notwithstanding the foregoing, the term of this Agreement shall be automatically
extended for the period that development is prevented or delayed, in whole or in part, due to an
event set forth in Section 8.11 below.
2.4 Assi ent.
2.4.1 Assieximent and Notification. The rights, interests and obligations
conveyed and provided herein to DEVELOPER benefit and are appurtenant to the Property.
DEVELOPER has the right to sell, assign and transfer any and all of its rights and interests and
to delegate any and all of its duties and obligations hereunder; provided, however, that such
rights and interests may not be transferred or assigned except in strict compliance with the
provisions of Section 4.2 of the DDA, and the following conditions:
533339.1
(a) DEVELOPER secures the written consent of CITY if required ~ -
pursuant to Section 4.2 of the DDA;
(b) Said rights and interests may be transferred or assigned only as an
incident of the transfer or assignment of the portion of the Property to which they relate,
including any transferor assignment pursuant to a foreclosure of a mortgage or a deed in lieu of
a foreclosure;
(c) Prior to assignment or transfer, if required pursuant to this
Section 2.4 and Section 4.2 of the DDA, DEVELOPER shall notify CITY in writing of such
assignment or transfer, the portions of the Property to which the assignment or transfer will be
appurtenant, and the name and address (for purposes of notices hereunder) of the transferee or
assignee, together with the corresponding number of dwelling units and/or non-residential
entitlements which aze proposed to be included within such transfer and DEVELOPER and the
assignee or transferee shall notify CITY whether the assignee or transferee will assume any of
DEVELOPER'S obligations under this Agreement and which of DEVELOPER'S obligations will
be assumed;
(d) The assignee or transferee shall have entered into an Assignment
and Assumption Agreement if required by the DDA;
Any attempt to assign or transfer any right or interest in this Agreement except in strict
compliance with this Section 2.4 shall be null and void and of no force and effect.
2.4.2 Subject to Terms of Agreement. Following an assignment or transfer of
any of the rights and interests of DEVELOPER set forth in this Agreement in accordance with
Section 2.4.1, the assignee's exercise, use, and enjoyment of the Property shall be subject to the
terms of this Agreement to the same extent as if the assignee or transferee were DEVELOPER.
2.4.3 Release of DEVELOPER Uuon Transfer. Notwithstanding the
assignment or transfer of portions or all of the Property or rights or interests under this
Agreement, DEVELOPER shall continue to be obligated under this Agreement unless released
or partially released by CITY with respect to DEVELOPER'S obligations and the other duties
and obligations of DEVELOPER under this Agreement, pursuant to this pazagraph, which
release or partial release shall be provided by CITY upon the full satisfaction by DEVELOPER
of the following conditions:
(a) DEVELOPER is not then in default under this Agreement;
(b) CITY has consented to the assignment or transfer if required under
Section 2.4.1;
(c) An assignee or transferee has assumed such duties and obligations
as to which DEVELOPER is requesting to be released; and
533339.1
(d) The assignee or transferee is financially able to assume the
obligations proposed for assignment and has demonstrated to the reasonable satisfaction of CITY
that adequate resources have been committed to the full performance of such obligations.
2.5 Pronertv to Continue to be Subject to This Aazeement. Until recordation of a
Certificate of Compliance as to the Phase or any pazcel thereof as provided in Section 9 of the
DDA, the Property shall continue to be subject to this Agreement. In the absence of specific
written agreement by CITY, pursuant to which CITY expressly releases the DEVELOPER under
the applicable provisions of the DDA or this Agreement, no Transfer shall constitute a release of
DEVELOPER from any of its obligations under this Agreement and the DEVELOPER shall
retain such obligations and remain jointly and severally liable for such obligations. CITY shall
cooperate with DEVELOPER, at no cost to CITY, in executing in recordable form any document
that CITY has approved to confirm the termination of this Agreement as to any such Phase or
parcel. Notwithstanding the foregoing, (a) the burdens of this Agreement shall terminate as to
any individual residential unit that is sold or leased after issuance of a certificate of occupancy
and as to any nonresidential pazcel that is leased or otherwise occupied by an end user after
issuance of a certificate of occupancy, and such pazcels shall be released from and shall no
longer be subject to this Agreement (without the execution or recordation of any further
document or the taking of any further action) and (b) the benefits of this Agreement shall
continue to run as to any such pazcel until Completion or until termination of this Agreement, if
eazlier.
2.6 Amendment or Cancellation of Agreement. This Agreement may be amended or
cancelled in whole or in part only in the manner provided for in Government Code Section
65868 and Tustin CITY Code Section 9615. This provision shall not limit any remedy of CITY
or DEVELOPER as provided by this Agreement. Either party or Successor in Interest may
propose an amendment to or cancellation, in whole or in part, of this Agreement. Any
amendment or cancellation shall be by mutual consent of the parties or their Successors in
Interest except as provided otherwise in this Agreement, in Government Code Section 65865.1,
or in the Tustin City Code.
2.7 Termination. This Agreement. shall be deemed terminated and of no further effect
upon the occurrence of any of the following events:
(a) Expiration of the stated term of this Agreement as set forth in
Section 2.3.
(b) Entry of a fmal judgment setting aside, voiding or annulling the
adoption of the CITY ordinance approving this Agreement.
(c) The adoption of a referendum measure overriding or repealing the
CITY ordinance approving this Agreement.
(d) Completion of the Project in accordance with the terms of this
Agreement, the DDA, Entitlement Approvals, and applicable Land Use Regulations, including
issuance of all required occupancy permits and acceptance by CITY or applicable public agency
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533339.1
of all required public improvements and dedications, and CITY issuance of a final DDA
Certificate of Compliance.
(e) Due to a default hereunder, as set forth in Article 5 below.
(f) Upon mutual written agreement of CITY and DEVELOPER.
Termination of this Agreement shall not constitute termination of any other land use
entitlements approved for the Property. Upon the termination of this Agreement, no party shall
have any further right or obligation hereunder except with respect to any obligation to have been
performed prior to such termination or with respect to any default in the performance of the
provisions of this Agreement which has occun•ed prior to such termination or with respect to any
obligations which aze specifically set forth as surviving this Agreement.
2.8 Notices, Demands and Communications between the Parties. 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 United States mail via certified mail, return receipt requested, postage prepaid, and addressed
to the other party as set forth below; or (c) the next business day after such notice has been
deposited with a national overnight delivery service reasonably approved by the parties (Federal
Express, United Pazcel 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 guazanteed, provided that the sending party receives a confirmation of
delivery from the delivery service provider. Unless otherwise provided in writing, all notices
hereunder shall be addressed as follows:
If to CITY: Tustin City Hall
300 Centennial Way
Tustin, CA 92780
Attention: City Manager
and Attention: Assistant City Manager
With a copy to: City Attorney, City of Tustin
Woodruff Spradlin & Smart
701 S. Pazker Street, Suite 8000
Orange, CA 92868-4760
Attention: Doug Holland, Esq.
And a copy to: Steefel, Levitt & Weiss
A Professional Corporation
One Embarcadero Center, 30a' Floor
San Francisco, CA 94111
Attention: Clayton B. Gantz, Esq.
If to DEVELOPER: Tustin Legacy Community Partners, LLC
c/o Shea Properties
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533339.1
26840 Aliso Viejo Pazkway, Suite 100
Aliso Viejo, CA 92656
With a copy to: Shea Homes LP
Southern California Division
603 S. Valencia Avenue
Brea, CA 92823
Attention: Les Thomas, President
With a copy to: Shea Properties
26840 Aliso Viejo Pazkway, Suite 100
Aliso Viejo, CA 92656
Attention: Color Macken, CEO
Steve Stambaugh, CFO
With a copy to: Centex Homes
Southern California Coastal Division
27101 Puerta Real, Suite 300
Mission Viejo, CA 92691
Attention: Richazd Douglass, President
And a copy to
(for legal notices): Tustin Legacy Community Partners, LLC
27101 Puerta Real, Suite 300
Mission Viejo, CA 92691
Attention: Donald J. Sajor, Vice President and
Division General Counsel
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.
DEVELOPMENT OF THE PROPERTY.
3.1 Applicable Regulations: Vested Right to Dever. Other than as expressly set
forth herein, during the Term of this Agreement, the terms and conditions of development
applicable to the Property, including but not limited to the permitted uses of the Property, the
density and intensity of use, maximum height and size of proposed buildings, the design,
improvement and construction standazds and specifications applicable to the development of the
Property, including any changes authorized pursuant to Section 3.5.4, and the provisions for the
reservation and dedication of land as needed for public purposes pursuant to Governmental
Requirements, shall be those set forth in the DDA, Existing Land Use Regulations, and
Entitlement Approvals. In connection therewith and subject to the terms of this Agreement
including the Reservations of Authority, DEVELOPER shall have the Vested Right to: (1) carry
out and develop the Property in accordance with the DDA (which includes the Development
Plan), Existing Land Use Regulations, Entitlement Approvals and the provisions of this
Agreement; (2) to receive from CITY all future entitlement approvals for the Project that CITY
finds aze consistent with and implement the DDA (which includes the Development Plan),
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533379.1
Existing Land Use Regulations, Entitlement Approvals and this Agreement, and (3) not have any
Entitlement Approvals conditioned or delayed for reasons inconsistent with the DDA (or as
contemplated in the DDA which includes the Development Plan), Existing Land Use
Regulations, Entitlement Approvals or this Agreement.
3.2 Effect of Agreement on Land Use Regulations. Except as otherwise provided
under the terms of this Agreement including the Reservations of Authority (and notwithstanding
any future action of CITY or its citizens, whether by ordinance, resolution, initiative or
otherwise), the rules, regulations, and official policies governing the Project, including, without
limitation, the permitted uses of the Property, the density and intensity of use of the Property, the
maximum height and size of proposed buildings, the design, improvement and construction
standards and specifications applicable to the Project, including any changes authorized pursuant
to Section 3.5.4, the subdivision of land and requirements for infrastructure and public
improvements, and other terms and conditions of the Project, shall be the DDA, Existing Land
Use Regulations, and the provisions of this Agreement. CITY shall accept for processing and
review and take action on all applications for Subsequent Entitlement Approvals as provided in
Section 3.6.2 below. In connection with any Subsequent Entitlement Approval, CITY shall
exercise discretion in accordance with the same manner as it exercises its discretion under its
police powers, including the Reservations of Authority; provided however, that such discretion
shall not prevent development of the Project as set forth in this Agreement.
3.3 Timine of Development. The timing of development will be as set forth in the
DDA. Since the California Supreme Court held in Pazdee Construction Co. v. City of Camazillo
(1984) 37 Cal. 3d 465, that the failure of the parties therein to provide for the timing of
development resulted in a later adopted initiative restricting the timing of development to prevail
over such parties' agreement, it is the parties' intent to cure that deficiency by acknowledging
and providing that DEVELOPER will adhere to the terms of the DDA regazding the timing of
development.
3.4 Changes and Amendments. The parties acknowledge that refinement and further
development of the Project will require Subsequent Entitlement Approvals and may demonstrate
that changes aze appropriate and mutually desirable in the Existing Entitlement Approvals. In the
event DEVELOPER fmds that a change in the Existing Entitlement Approvals is necessary or
appropriate, DEVELOPER shall apply for a Subsequent Entitlement Approval to effectuate such
change and CITY shall process and act on such application in accordance with the Existing Land
Use Regulations, except as otherwise provided by this Agreement including the Reservations of
Authority. If approved, any such change in the Existing Entitlement Approvals shall be
incorporated herein by reference as though fully set forth, shall thereafter be deemed to be an
Existing Entitlement Approval for all purposes of this Agreement and may be further changed
from time to time as provided in this Section. Unless otherwise required by law, as determined in
CITY's reasonable discretion, a change to the Existing Entitlement Approvals requested by
DEVELOPER or an approved assignee shall be deemed "minor" and shall not require an
amendment to this Agreement.
In an instance when CITY has reasonably determined that a proposed change to the Existing
Entitlement Approvals constitutes a minor change pursuant to this Section 3.4, CITY and
DEVELOPER shall cooperate to ensure the preparation of any environmental analysis deemed
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533339.1
appropriate and necessary pursuant to CEQA. Furthermore, CITY and DEVELOPER shall
cooperate to ensure the filing of a notice of determination in this regazd.
3.5 Reservations of Authority. Notwithstanding any other provision of this
Agreement to the contrary, the laws, rules, regulations and official policies set forth in this
Section 3.5 shall apply to and govem development of the Property and Project to the extent set
forth herein.
3.5.1 Consistent Future City Re ations. CITY ordinances, resolutions, and
official policies, including initiative measures, adopted or approved after the Effective Date
pursuant to procedures provided by law which aze applied on a city-wide basis ("New CITY
Laws") shall apply to and govern development of the Property, provided that any New CITY
Laws which reduce the density or intensity of the Project below that permitted by the Existing
Land Use Regulations, the Existing Entitlement Approvals or the DDA, alter the permitted uses
of the Property, reduce the maximum height or size of any permitted buildings, impose
additional obligations in connection with the reservation or dedication of land for public
purposes beyond the requirements identified in the DDA, or limit the rate, timing, or sequencing
of development of the Property from that required in the DDA or in any Entitlement Approvals,
shall be deemed inconsistent with this Agreement and shall not be applicable to the development
of the Property and Project.
3.5.2 Overridine State and Federal Laws. CITY shall not be precluded from
adopting and applying New CITY Laws to the Project and development of the Project to the
extent that such New CITY Laws are required to be applied by State or Federal laws or
regulations and which would ovemde DEVELOPER's Vested Rights as set forth in this
Agreement, provided however, that (i) DEVELOPER does not waive its right to challenge or
contest the validity of such State, Federal, or New CITY Laws or regulation; and (ii) such new
CITY Law shall only be applied to the Project and development of the Project to the extent
necessary to comply with such new State or Federal law or regulation. In the event that such
State or Federal law or regulation (or New CITY Laws undertaken pursuant thereto) prevents or
precludes substantial compliance with one or more provisions of the DDA, the Existing Land
Use Regulations or this Agreement, the Parties agree to consider in good faith amending or
suspending such provisions of this Agreement as may be necessary to comply with such State or
Federal laws (or New CITY Laws), provided that no Party shall be bound to approve any
amendment to this Agreement unless this Agreement is amended in accordance with the
procedures applicable to the adoption of development agreements as set forth in the
Development Agreement Statute and Tustin CITY Code and each Party retains full discretion
with respect thereto. Developer acknowledges that any provision of this Section does not apply
to DEVELOPER'S acknowledgement and agreement in the DDA that any cun•ent or subsequent
provisions of State Law with regazds to density bonuses and other regulatory incentives for
provision of affordable housing do not apply to the Project or Property.
3.5.3 Public Health and Safetv. Nothing in this Agreement shall preclude the
City Council of the CITY from adopting and applying New CITY Laws which the City Council
of the CITY finds are reasonably necessary to protect persons on the Property or in the
immediate community, or both, from conditions dangerous to their health or safety
notwithstanding that the applications of such New CITY Laws, or other similar limitation would
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533339.1
result in the impairment of DEVELOPER'S Vested Rights under the Agreement or the Existing --
Land Use Regulations. In determining whether any such New CITY Laws aze reasonably
necessary to protect persons as set forth above, the City Council shall make findings, based on
evidence presented to and accepted by the City Council that the changes aze reasonably
necessary to protect the public health or safety. The provisions of this Section 3.5.3 do not apply
to any measure adopted by initiative.
3.5.4 Uniform Construction Codes and Regulations. Policies and rules
governing engineering and construction standazds and specifications applicable to public and
private improvements, including all uniform codes adopted by CITY and any local amendments
to those codes adopted by CITY in the future shall apply to the Project and Property.
3.5.5 Police Power. The Parties acknowledge and agree that CITY can not
contractually limit its own police power, its power to address actual or potential threats to public
health or safety, including but not limited to environmental regulations (including without
limitation NPDES) or its emergency authority or powers. The foregoing limitations,
reservations, and exceptions are intended to reserve to CITY all of its powers that cannot be
limited. In all respects not provided for in this Agreement, CITY shall retain full rights to
exercise its police powers to regulate development of the Project and Property. Any uses or
development requiring a concept plan, design review, tentative tract map, conditional use permit,
variance, or other Entitlement Approvals in accordance with Existing Land Use Regulations
shall require a permit or approval pursuant to this Agreement and notwithstanding any other
provision set forth herein, this Agreement is not intended to vest DEVELOPER'S right to
issuance of such permit or approval.
3.6 Processine.
3.6.1 Subdivisions. A subdivision, as deemed in Government Code
Section 66473.7, shall not be approved unless a tentative map for the subdivision complies with
the provisions of said Section 66473.7. This provision is included in this Agreement to comply
with Section 65867.5 of the Government Code.
3.6.2 Subsequent Entitlement Approvals. CITY shall employ all lawful actions
capable of being undertaken by CITY to promptly (i) accept all complete applications for
Subsequent Entitlement Approvals (collectively, "Applications") and (ii) process and take action
upon Applications in accordance with applicable law with a goal of completing the review
within time frames identified in the DDA; provided however, that CITY shall not be deemed in
default under this Agreement should such time frame(s) not be met. To the extent that
DEVELOPER desires that CITY plan check or process an Application on an expedited basis and
to the extent that it requires an additional expense beyond the customazy expense applicable to
the general public, CITY shall inform DEVELOPER of such additional expense, including the ,
cost of overtime and private consultants and other third-parties. If acceptable to DEVELOPER,
DEVELOPER shall pay the additional cost and CITY shall use best efforts to undertake the most
accelerated processing time as lawfully possible utilizing overtime and the services of private
consultants and third parties to the extent available. Upon the written request of DEVELOPER,
CITY shall inform DEVELOPER of the necessary application requirements for any requested
CITY approval or requirement relating to the Project. CITY may deny an application for a
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573339.1
Subsequent Entitlement Approval only if such application does not comply with the DDA, this
Agreement or Existing Land Use Regulations or is materially inconsistent with the Existing
Entitlement Approvals.
3.6.3 Filines. DEVELOPER shall exercise reasonable efforts to file
applications for permits and Entitlement Approvals within the time frames and schedules as
generally outlined in the DDA and shall exercise reasonable efforts to attempt to obtain permits
and Entitlement Approvals within the time frames identified in the DDA; provided, however,
that failure solely to comply with such time frame(s) shall not be deemed to be a default under
this Agreement.
3.6.4 Cooperation. CITY and DEVELOPER shall cooperate in processing all
applications for permits and approvals for the Project, provided, however, that such cooperation
shall not include any obligation of CITY to incur any un-reimbursed expense, and CITY shall be
entitled, subject to the terms of this Agreement, the DDA and DEVELOPER's rights hereunder,
to exercise all discretion to which it is entitled by law in processing and issuing any permits and
approvals for the Project.
3.6.5 Approvals. Notwithstanding any administrative or judicial proceedings,
initiative or referendum concerning any of the Entitlement Approvals, CITY shall process
applications for permits and approvals as provided herein to the fullest extent allowed bylaw and
DEVELOPER may proceed with development of the Project pursuant to the DDA, Existing
Land Use Regulations, and Entitlement Approvals to the fullest extent allowed by law.
3.7 Infrastructure and Public Facilities. Construction of infrastructure and public
facilities will be as set forth in the DDA. DEVELOPER's construction of pazk improvements
pursuant to the DDA shall be deemed to satisfy any requirement imposed upon DEVELOPER
for the dedication or development of pazkland pursuant to the Tustin City Code in connection
with development of the Project and Property.
3.8 Dedications. DEVELOPER acknowledges and agrees that it is required (and will
be required) to dedicate to CITY and other public agencies on the Sector A subdivision map, and
on subsequent subdivision maps, or in conjunction with Entitlement Approvals, certain required
dedications as required by the DDA, and Existing Land Use Regulations, or by DEVELOPER
pursuant to the FINAL EIS/EIR for the MCAS Tustin Project, as amended by either
supplemental documentation or addendum and as required by DEVELOPER pursuant to
DEVELOPER'S assumption of CITY MCAS Tustin obligations under the "Agreement Between
the City of Irvine and the City of Tustin Regazding the Implementation, Timing, Funding of
Transportation/Circulation Mitigation for the MCAS Tustin Project" and the "Amendment to the
Joint Exercise of Powers Agreement Between the City of Santa Ana and the City of Tustin
Regazding the Tustin-Santa Ana Transportation Improvement Authority".
3.9 Reeulation by Other Public Aeencies It is acknowledged by the parties that other
public agencies not within the control of CITY possess authority to regulate aspects of the
Project and development of the Property separately from or jointly with CITY and this
Agreement does not limit the authority of such other public agencies. CITY agrees to cooperate
fully, at no out of pocket cost to CITY, with DEVELOPER in obtaining any required permits or
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533339.1
compliance with the regulations of other public agencies provided such cooperation is not in
conflict with any laws, regulations or policies of CITY.
3.10 Tentative Tract Map Extension. Each tentative subdivision map or tentative
parcel map, heretofore or hereafter approved in connection with development of the Property,
shall be eligible for extensions of time as provided in Government Code Section 66452.6, except
that any extension shall be consistent with any applicable performance schedule as provided or
established in the DDA and shall not be deemed or considered in any way an extension of any
DEVELOPER obligations under the DDA.
4. ANNUAL REVIEW. Timing and Annual Review. The Tustin City Council shall review
DEVELOPER'S performance under this Agreement at least every twelve (12) months from the
Effective Date until expiration of the Agreement. In connection with such review, both the
CITY and DEVELOPER shall have a reasonable opportunity to assert matters which either
believes have not been undertaken in accordance with this Agreement, to explain the basis for
such assertion, and to receive from the other party a justification of its position on such matters.
4.1 Review Procedure.. CITY shall provide notice to DEVELOPER and deliver to
DEVELOPER or it successor in interest a copy of all public staff reports, documents and related
exhibits concerning CITY'S review of DEVELOPER'S performance hereunder at least 30 days
prior to any date proposed for City Council review of performance under the Agreement.
4.1.1 DEVELOPER or its Successor in Interest shall demonstrate good faith
compliance with the terms of this Agreement and shall famish evidence of good faith
compliance, as CITY, in its reasonable exercise of its discretion, may require. Evidence of good
faith compliance may include the following:
(a) conformance with the DDA and its scope of development and
schedule of performance;
(b) conformance with the requirements of the Specific Plan; and
(c) conformance with provisions of this Agreement identified by the
CITY.
4.1.2 DEVELOPER or its successor in interest shall have the opportunity to
respond to CITY'S evaluation of DEVELOPER'S performance, either orally or in a written
statement, at DEVELOPER'S election.
4.1.3 The City Council may refer the matter to the Planning Commission for
further proceedings or for a report and recommendation.
4.2 Notice of Non-Compliance. If on the basis of the annual review, the CITY
determines, or at any other time during the term of this Agreement, either Party concludes that
the other party has not complied in good faith with the terms of this Agreement, then such Party
may issue a written "Notice of Non-Compliance" specifying the grounds therefore and all facts
demonstrating such non-compliance. The Party receiving a Notice ofNon-Compliance shall
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573339.1
have forty-five (45) days to respond in writing to said notice by specifying either how its non-
compliance has been cured (or is diligently being cured) or the grounds upon which it believes
that it is complying with this Agreement. The time frame to respond to a Notice of Non-
compliance may be extended by mutual agreement of the Parties. If the response to the Notice
ofNon-Compliance has not been received in the offices of the Party alleging non-compliance
within the prescribed forty-five (45) days, or within such other period of time as mutually
agreed, the Notice ofNon-Compliance shall be conclusively presumed to be valid, and if the
non-complying Party is DEVELOPER, the CITY may commence proceedings on termination or
modification of the Agreement pursuant to the Tustin City Code and Section 4.3 of this
Agreement. If the party receiving a Notice ofNon-Compliance responds within the time period
provided above, the parties agree to meet in good faith at reasonable times and from time to time
for a period of at least sixty (60) days to arrive at a mutually acceptable resolution of the
matter(s) asserted in the Notice of Non-Compliance and disputed in the response. If after sixty
(60) days, or any extension of time as mutually agreed to by the Parties, the Parties have failed to
arrive at a mutually acceptable resolution of such matter(s), either Party may pursue any remedy
at law or in equity, and the CITY may commence proceedings on termination or modification of
this Agreement pursuant to Sections 9617 and 9618 of the Tustin City Code and Section 4.3 of
this Agreement.
4.3 Modification or Termination. If the City Council determines to proceed with
modification or termination of this Agreement after following the procedure for a Notice of
Non-Compliance under Section 4.2 of this Agreement, the City Council shall give notice to
DEVELOPER or successor in interest thereto of its intention to do so. The Notice shall contain
all information required by Tustin City Code Section 9618. At the time and place set for the
hearing on modification or termination, the City Council may refer the matter back to the
Planning Commission for further proceedings or for a report and recommendation. The City
Council may take such action as it deems necessary to protect the interests of the CITY,
including but not limited to, the receipt of additional evidence as to DEVELOPER'S compliance
with the terms of this Agreement. The decision of the City Council shall be final, subject only to
judicial review pursuant to California Code of Civil Procedure Section 1094.5(b).
4.4 Certificate of Agreement Compliance. If, at the conclusion of a periodic review,
DEVELOPER is found to be in compliance with this Agreement, CITY shall, upon request of
the DEVELOPER, issue a Certificate of Compliance (the "Certificate") to DEVELOPER stating
that after the most recent periodic review and based upon the information known or made known
to the City Council that: (1) this Agreement remains in effect, and (2) DEVELOPER is not in
default. The Certificate shall be in recordable form, shall contain information necessazy to
communicate constructive record notice of the finding of compliance, and shall state the
anticipated date of commencement of the next periodic review. DEVELOPER may record the
Certificate with the County Recorder.
DEFAULT, REMEDIES. AND TERMINATION.
5.1 Default Procedure. In addition to procedures identified in Section 4.2 and/or 4.3
of this Agreement, anon-defaulting party (the "Non-Defaulting Party") at its discretion may
elect to declaze a default under this Agreement in accordance with the procedures hereinafter set
forth for any failure or breach of any other Party ("Defaulting Party") to perform any material
17
533339.1
duty or obligation of said Defaulting Party in accordance with the terms of this Agreement and
provided the Notice of Non-Compliance procedures in Section 4.2 have first been exhausted.
However, the Non-Defaulting Party must provide written notice to the Defaulting Party setting
forth the nature of the breach or failure and the actions, if any, required by the Defaulting Party
to cure such breach or failure. The Defaulting Party shall be deemed to be in "default" of its
obligations set forth in this Agreement if the Defaulting Party has failed to take action and cure
the default within ten (10) days after the date of such notice (for monetary defaults) or within
thirty (30) days after the date of such notice (for non-monetary defaults). If, however, anon-
monetazy default cannot be cured within such thirty (30) day period, as long as the Defaulting
Party does each of the following:
(a) notices the Non-Defaulting Party in writing with a reasonable explanation
as to the reasons the asserted default is not curable within the thirty (30) day period;
(b) notifies the Non-Defaulting Party in writing of the Defaulting Party's
proposed course of action to cure the default;
(c) promptly commences to cure the default within the thirty (30) day period;
(d) makes periodic written reports to the Non-Defaulting Party as to the
progress of the program of cure, and:
(e) diligently prosecutes such cure to completion,
then the Non-Defaulting Party shall grant in writing the Defaulting Party such additional time
as determined by the Non-Defaulting Party as reasonably necessary to cure such default.
5.2 Default Remedies. After complying with Section 5.1, in the event of an uncured
default, the Non-Defaulting Party, at its option, may institute legal action to cure, correct or
remedy such default, enjoining any threatened or attempted violation, enforce the terms of this
Agreement by specific performance, or pursue any other legal or equitable remedy.
Furthermore, CITY, in addition to or as an alternative to exercising the remedies in this
Section 5.2, in the event of a material default by DEVELOPER, may give notice of its intent to
terminate or modify this Agreement pursuant to Section 4.3, in which event the matter shall be
scheduled for consideration and review by the City Council in the manner set forth in Tustin City
Code Section 9618. The decision of the City Council shall be fmal, subject only to judicial
review pursuant to California Code of Civil Procedure Section 1094.5(b).
5.3 DEVELOPER'S Remedies. In the event that the CITY is in material default
under this Agreement, the DEVELOPER shall be entitled to any or all of the following remedies:
(1) Seeking mandamus or specific performance of this Agreement; or (2) Seeking any other
remedy available at law or in equity, provided, however, except as provided in Section 8.10
below, the DEVELOPER agrees and covenants on behalf of itself and it successors and assigns,
not to sue CITY for damages or monetary relief for any breach of this Agreement or arising out
of or connected with any dispute, controversy or issue regarding the application or effect of this ~,
Agreement, or for consequential damages arising out of or connected with any dispute,
controversy, or issues regazding the application or effect of the Existing Land Use Regulations,
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533339.1
or any Development Permits or Entitlement Approvals sought in connection with development or
use of the Property or Project, or any portion thereof.
5.4 Third Partv Legal Challenees. In the event of any legal action instituted by a third
party challenging the validity or enforceability of any provision of this Agreement, the Existing
Land Use Regulations, the DDA (including without limitation the Development Plan), or
Entitlement Approvals for the Project ("Third Party Challenge"), DEVELOPER shall have the
right but not the obligation to defend any Third Party Challenge, at its expense. DEVELOPER,
in defending any Third Party Challenge shall further have the right to settle such Third Party
Challenge, provided that nothing herein shall authorize DEVELOPER to settle such Third Party
Challenge on terms that would constitute an amendment or modification of this Agreement, the
Existing Regulations, or Development Plan unless such amendment or modification is approved
by the CITY in accordance with applicable legal requirements, and CITY reserves its full
legislative discretion with respect thereto. CITY shall not incur any costs or take any actions to
defend such Third Party Challenge without DEVELOPER'S approval. DEVELOPER shall also
indemnify and hold harmless the CITY and its agents, officials and employees from and against
all claims, losses, or liabilities assessed or awazded against the CITY by way of judgment,
settlement, or stipulation.
6. INDEMNITY BY DEVELOPER. DEVELOPER agrees to indemnify, defend, and hold
harmless CITY, CITY'S designees, and their respective elected and appointed officials, boazds,
commissions, agents, contractors, and employees from and against any and all actions, suits,
claims, liabilities, losses, damages, penalties, obligations and expenses (including but not limited
to attorney's fees and costs) which may arise, directly or indirectly, from the acts, omissions, or
operations of DEVELOPER or DEVELOPER'S agents, contractors, subcontractors, agents, or
employees pursuant to this Agreement, but excluding any loss resulting from the intentional or
active negligence of the CITY, CITY'S designee, or each of their respective elected and
appointed officials, boards, commissions, officers, agents, contractors, and employees.
DEVELOPER shall select and retain counsel reasonably acceptable to the CITY to defend any
action or actions and DEVELOPER shall pay the cost thereof The indemnity provisions set forth
in this Agreement shall survive termination of the Agreement.
7. MORTGAGEE PROTECTION. The parties hereto agree that this Agreement shall not
prevent or limit DEVELOPER, in any manner, from encumbering the Property or any portion
thereof or any improvement thereon by any mortgage, deed of trust or other security device
securing financing with respect to the Property, subject to any terms or provisions of the DDA to
the extent relating to the encumbrance of the Property by any mortgage, deed of trust or other
security device. Any Mortgagee of the Property shall be entitled to the following rights and
privileges:
(a) This Agreement shall be superior to the lien of any mortgage.
Notwithstanding the foregoing, neither entering into this Agreement nor a breach of this
Agreement shall defeat, render invalid, diminish or impair the lien of any mortgage on the
Property made in good faith and for value, unless otherwise required by law, and any acquisition
or acceptance of title or any right or interest in or with respect to the Property or any portion
thereof by a mortgagee (whether pursuant to foreclosure, trustee's sale, deed in lieu of
foreclosure, lease termination or otherwise) shall be subject to the terms and conditions of this
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533339.1
Agreement and any such mortgagee who takes title to the Property or any portion thereof shall be
entitled to benefits arising under this Agreement.
(b) Each Mortgagee of any mortgage or deed of trust encumbering the
Property, or any part thereof, shall upon written request in writing to CITY, be entitled to receive
written notice from CITY of results of the Annual Review and of any default by DEVELOPER
in the performance of DEVELOPER'S obligations under this Agreement.
(c) If CITY timely receives a request from a Mortgagee requesting a copy of
any notice of default given to DEVELOPER under the terms of this Agreement, CITY shall
provide a copy of that notice to the Mortgagee concurrently with delivery of the notice of default
to DEVELOPER. The Mortgagee shall have the right, but not the obligation, to cure the default
during the remaining cure period allowed such party under this Agreement (including any
extended cure period necessazy in order to allow the Mortgagee to obtain title to the Property and
cure the default).
(d) Any Mortgagee who comes into possession of the Property, or any part
thereof, pursuant to foreclosure of the mortgage or deed of trust, or deed in lieu of such
foreclosure, shall take the Property, or part thereof, subject to the terms of this Agreement.
Notwithstanding any other provision of this Agreement to the contrary, no Mortgagee shall have
an obligation or duty under this Agreement to perform any of DEVELOPER's obligations or
other affirmative covenants of DEVELOPER hereunder, or to guarantee such performance;
except that (i) the Mortgagee shall have no right to develop the Property without fully complying
with the terms of this Agreement, the DDA, Existing Land Use Regulations and Entitlement
Approvals and (ii) to the extent that any covenant to be performed by DEVELOPER is a
condition precedent to the performance of a covenant by CITY, the performance thereof shall
continue to be a condition precedent to CITY'S performance hereunder.
Notwithstanding anything to the contrazy contained above in this Section, any Mortgagee
shall be subject to all of the terms of the DDA, to the extent applicable pursuant to the DDA to
such Mortgagee.
8. MISCELLANEOUS PROVISIONS.
8.1 Recordation of Agreement. This Agreement and any amendment or cancellation
thereof shall be recorded with the Orange County Recorder by the City Clerk within ten (10)
days after CITY executes this Agreement, as required by Section 65868.5 of the Government
Code. If the parties to this Agreement or their Successors in Interest amend or cancel this
Agreement as provided for herein and in Government Code Section 65868, or if CITY
terminates or modifies this Agreement as provided for herein and in Government Code Section
65865.1 for failure of DEVELOPER to comply in good faith with the terms or conditions of this
Agreement, the City Clerk shall have notice of such action recorded with the Orange County
Recorder.
8.2 Entire Agreement. This Agreement sets forth and contains the entire
understanding and agreement of the parties with respect to the matters set forth herein, and there
aze no oral or written representations, understandings or ancillazy covenants, undertakings or
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533339.1
agreements which aze not contained or expressly referred to herein. No testimony or evidence of
any such representations, understandings or covenants shall be admissible in any proceeding of
any kind or nature to interpret or determine the terms or conditions of this Agreement.
8.3 Severability. If any term, provision, covenant or condition of this Agreement
shall be determined invalid, void or unenforceable, the remainder of this Agreement shall not be
affected thereby to the extent such remaining provisions aze not rendered impractical to perform
taking into consideration the purposes of this Agreement.
8.4 Interoretation and Governin¢ Law. This Agreement and any dispute arising
hereunder shall be governed and interpreted in accordance with the internal laws of the State of
California without reference to choice of law or conflicts of law provisions. This Agreement
shall be construed as a whole according to its fair language and common meaning to achieve the
objectives and purposes of the parties hereto, and the rule of construction to the effect that
ambiguities aze to be resolved against the drafting party shall not be employed in interpreting this
Agreement, all parties having been represented by counsel in the negotiation and prepazation
hereof. The decision of the City Council shall be final, subject only to judicial review pursuant
to California Code of Civil Procedure Section 1094.5(b).
8.5 Section Headin¢s. All section headings and subheadings aze inserted for
convenience only and shall not affect any construction or interpretation of this Agreement.
8.6 Singular and Plural. As used herein, the singulaz of any word includes the plural.
8.7 Time of Essence. Subject to the following sentence, time is of the essence in the
performance of each provision of this Agreement. Whenever action must be taken (including the
giving of notice or the delivery of documents) under this Agreement during a certain period of
time or by a particulaz date that ends or occurs on anon-business day, then such period or date
shall be extended until the immediately following business day. As used herein, "business day"
means any day other than Saturday, Sunday or a federal or California state holiday.
8.8 Waiver. Failure bya party to insist upon the strict performance of any of the
provisions of this Agreement by the other party, or the failure by a party to exercise its rights
upon the default of the other party, shall not constitute a waiver of such party's right to insist and
demand strict compliance by the other party with the terms of this Agreement thereafter.
8.9 No Third Partv Beneficiaries. This Agreement is made and entered into for the
sole protection and benefit of the parties and their successors and assigns. No other person shall
have any right of action based upon any provision of this Agreement.
8.10 Attornevs Fees. If legal action is commenced to enforce or to declaze the effect of
any provision of this Agreement, the prevailing party shall be entitled to recover from the non-
prevailing party actual and reasonable attorneys' fees and other litigation costs. In addition to
the foregoing awazd of attorneys' fees and other litigation costs to the prevailing party, the
prevailing party in any lawsuit or reference proceeding on this Agreement shall be entitled to its
attorneys' fees and other litigation costs incurred in any post-judgment proceedings to collect or
enforce the judgment. This provision is sepazate and several and shall survive the merger of this
21
5)3339.1
Agreement into any judgment on this Agreement. This provision shall survive termination of -
this Agreement.
8.11 Force Majeure.
8.11.1 Time periods for performance of any obligations under this Agreement
may be extended for Force Majeure, except that in no event, shall the Term of this Agreement be
extended by an event of Force Majeure Delay.
8.11.2 In the event of a lawsuit, referendum, or initiative which constitutes a
Force Majeure Delay and which directly affects the ability of the claiming Party to meet its non-
monetary obligations under this Agreement, including the deadlines imposed by the DDA
Schedule of Performance or the ability of the DEVELOPER to Complete the Project for a period
of more than two yeazs, the Parties shall meet and confer on mutually acceptable ways or
modifications to the Project to proceed with development thereof notwithstanding such lawsuit,
referendum or initiative. In the event that the Parties aze unable to agree, the question of whether
the extension of such period of Force Majeure Delay beyond two yeazs is reasonable under the
circumstances will be presented to the City Council (with reasonable notice to and an
opportunity to be heazd by the DEVELOPER). The City Council may then decide based on its
good faith deliberations to either permit the extension of such period of Force Majeure Delay or
proceed with its remedies under this Agreement. The decision of the City Council shall be final,
subject only to judicial review pursuant to California Code of Civil Procedure Section 1094.5(b).
8.11.3 If any Party (the "First Party") believes that an extension of time is due to
Force Majeure Delay, it shall notify the other Party (the "Second Party") in writing within thirty
(30) calendaz days from the date upon which the First Party becomes awaze of such Force
Majeure Delay, describing the Force Majeure Delay, when and how the First Party obtained
knowledge thereof, the date the event commenced, the steps the First Party anticipates taking to
respond to such Force Majeure Delay, and the estimated delay resulting from such Force
Majeure Delay and response. The extension for Force Majeure Delay shall be granted or denied
in the Second Party's reasonable discretion. If the First Party fails to notify the Second Party in
writing of its request for a given Force Majeure Delay within the thirty (30) calendaz days
specified above, there shall be no extension for such Force Majeure Delay.
8.12 Successors in Interest. The burdens of this Agreement shall be binding upon, and
the benefits of this Agreement shall inure to, all Successors in Interest to the parties to this
Agreement. All provisions of this Agreement shall be enforceable as equitable servitudes and
constitute covenants running with the land. Each covenant to do or refrain from doing some act
hereunder with regazd to development of the Property: (a) is for the benefit of and is a burden
upon every portion of the Property; (b) runs with the Property and each portion thereof; and, (c)
is binding upon each party and each successor in interest during ownership of the Property or any
portion thereof.
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533339.1
8.13 Counterparts. This Agreement may be executed by the parties in counterparts,
which counterparts shall be construed together and have the same affect as if all of the parties
had executed the same instrument.
8.14 Jurisdiction and Venue. Subject to the provisions of Section 5.3 above, any action
at law or in equity arising under this Agreement or brought by a party hereto for the purpose of
enforcing, construing or determining the validity of any provision of this Agreement shall be
filed and tried in the Superior Court of the County of Orange, State of California, or the United
States District Court for the Central District of California, Santa Ana Division, and the parties
hereto waive all provisions of law providing for the filing, removal or change of venue to any
other court.
8.15 Project as a Private Undertaking. It is specifically understood and agreed by and
between the parties hereto that the development of the Project is a private development, that
neither party is acting as the agent of the other in any respect hereunder, and that each party is an
independent contracting entity with respect to the temvs, covenants and conditions contained in
this Agreement. No partnership, joint venture or other association of any kind is formed by this
Agreement. The only relationship between CITY and DEVELOPER is that of a government
entity regulating the development of private property and DEVELOPER of such property.
8.16 Further Actions and Instruments. Each of the parties shall cooperate with and
provide reasonable assistance to the other to the extent contemplated hereunder in the
performance of all obligations under this Agreement and the satisfaction of the conditions of this
Agreement. Upon the request of either party at any time, the other party shall promptly execute,
with acknowledgment or affidavit if reasonably required, and file or record such required
instruments and writings and take any actions as may be reasonably necessary under the terms of
this Agreement to carry out the intent and to fulfill the provisions of this Agreement or to
evidence or consummate the transactions contemplated by this Agreement.
8.17 Estoppel Certificate. Any party hereunder, may , at any time, deliver a written
notice to the other party requesting such Party to certify in writing that, to the best knowledge of
the certifying party: (i) this Agreement is in full force and effect and a binding obligation of the
party ; (ii) this Agreement has not been amended or modified either orally or in writing, or if so
amended, identifying the date and nature of the amendments to this Agreement, but it remains in
full force and effect as modified, and a continuing binding obligation of the party; and (iii) the
requesting party is not in default in performance of their obligations set forth in the Agreement,
or if the party is in default, provide a description thereof of the nature of such default(s). A party
receiving a request hereunder shall execute and return such certificate within thirty (30) days
following receipt thereof. Any third party, including a mortgagee shall be entitled to rely on the
certificate. DEVELOPER shall pay to CITY all costs incurred by CITY in connection with the
issuance of estoppel certificates.
8.18 Authority to Execute. The person or persons executing this Agreement on behalf
of each party warrants and represents that he or she/they have the authority to execute this
Agreement on behalf of such party and warrants and represents that he or she/they has/have the
authority to bind such party to the performance of its obligations hereunder.
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573339.1
[SIGNATURES CONTAINED ON FOLLOWING PAGE] ~.,
24
573339.1
SIGNATURE PAGE
TO DEVELOPMENT AGREEMENT
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the day
and yeaz set forth below.
"CITY"
City of Tustin, California
By:
William Huston, City Manager or
Christine Shingleton, Assistant City Manager
ATTEST:
By:
Pamela Stoker
City Clerk
Dated:
APPROVED AS TO FORM
Office of the City Attorney
ay:
Douglas Holland
25
533339.1
"DEVELOPER"
Tustin Legacy Community Partners, LLC,
a Delawaze limited liability company
By: Shea Properties, LLC, a Delawaze limited
liability company, Managing Member
By:
Its:
By:
Name:
Its:
By: Centex Homes, a Nevada general
partnership, a Member
By: Centex Real Estate Corporation,
a Nevada Corporation,
Managing General Partner
By:
Name:
Its:
By:
Name:
Its:
By: Shea Homes Limited Paztnership,
a California limited partnership, a Member
By:
Naz
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533339.1
EXHIBIT "A"
TO DEVELOPMENT AGREEMENT
Legal Description of Property
< Same Legal as applied to DDA should be attached since obligations go beyond Developer
property but to ProjecV>
[to be inserted/attached]
Exhibit A
573339.1
EXHIBIT "B"
TO DEVELOPMENT AGREEMENT
Map showing Property and its location
[to be inserted/attached]
~~.
Exhibit B
533339.1