Loading...
HomeMy WebLinkAboutORD 1538 (2023) ______________________ Ordinance No. 1538 Page 1 of 5 ORDINANCE NO. 1538 AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF TUSTIN, APPROVING DEVELOPMENT AGREEMENT (DA) 2023-0002 BETWEEN THE CITY OF TUSTIN AND CITY VENTURES HOMEBUILDING, LLC TO ACCEPT THE VOLUNTARY PROVISION OF COMMUNITY PUBLIC BENEFITS, BY INCLUDING TWO (2) AFFORDABLE HOUSING UNITS FOR VERY-LOW INCOME HOUSEHOLDS, PAYMENT OF VOLUNTARY WORKFORCE HOUSING INCENTIVE PROGRAM IN-LIEU FEE, AND A 1,392 SQUARE FOOT PUBLIC AMENITY SPACE FOR A NEW, LIVE/WORK AND RESIDENTIAL CONDOMINIUM DEVELOPMENT PROJECT THAT WOULD INCLUDE THIRY-FIVE (35) RESIDENTIAL CONDOMINIUM UNITS AND SEVEN (7) LIVE/WORK UNITS, FOR A TOTAL OF FORTY TWO (42) UNITS IN SIX BUILDINGS, INCLUDING TWO (2) AFFORDABLE UNITS, ON APPROXIMATELY TWO (2) ACRES AT 14042 NEWPORT AVENUE The City Council of the City of Tustin does hereby ordain as follows: SECTION 1. The City Council finds and determines as follows: A.That a proper application has been submitted to the City of Tustin (the City) Community Development Department by City Ventures Homebuilding, LLC for a Subdivision Map (SUB 2023-0003) / Vesting Tentative Tract Map (VTTM No. 19164), Design Review (DR) 2023-0019, Final Approval of RAR, Density Bonus requests for one (1) concession to remove the requirement for full replacement of frontage improvements along El Camino Real; two (2) waivers to reduce the minimum required ground floor commercial development standards within the live/work units that include the interior depth from 45 feet to 13 feet-8 inches (13’-8”) and first (1st) floor plate height of the live/work units from sixteen (16) feet to 10’1” feet; and use of State Density Bonus Law parking standards, which allow tandem parking; and Development Agreement (DA) 2023-0002 to construct a new, live/work and residential condominium development project that would include thirty-five (35) residential condominium units and seven (7) live/work units, for a total of forty-two (42) units in six (6) buildings, including two (2) affordable units, on approximately two (2) acres. The project would also include an enclosed, two-car garage and private open space for each dwelling unit, a total of seventeen (17) guest surface parking spaces, common open space areas, landscaping, and a 1,392 square foot (SF) public amenity space fronting El Camino Real. The project is located at 14042 Newport Avenue within Downtown Commercial Core Specific Plan (DCCSP; SP12). B.That Section 6.1.3.1 of DCCSP requires that approval of a Development Agreement shall be required for approval of a Subdivision Map. Applications DocuSign Envelope ID: D6D49AF1-372F-4200-8994-5F57C33E90EBDocuSign Envelope ID: E5073C16-5448-4149-87ED-FECA660F4B5F ______________________ Ordinance No. 1538 Page 2 of 5 for Development Agreements shall be processed in accordance with Section 6.1.4, Approval Authority of DCCSP and Article 9, Chapter 6, Development Agreements, of the Tustin City Code (TCC). C. That TCC Section 9611 requires the applicant and the City to enter into a DA for the voluntary provision of community public benefits, by including two (2) affordable housing units for very-low income households, payment of voluntary workforce housing incentive program in-lieu fee, and a 1,392 square foot public amenity space. D. That the proposed voluntary provision of community public benefits, by including two (2) affordable housing units for very-low income households, payment of affordable housing in-lieu fee, and a 1,392 public amenity space is in the best interest of the public in that it increases the diversity in available housing for existing and new residents in the City of Tustin. E. That Section 65864 et seq. of the Government Code and Sections 9600 to 9619 of the TCC authorize the Tustin City Council to enter into a Development Agreement. In compliance with TCC Section 9611, the Tustin Planning Commission must make a recommendation on the proposed Development Agreement (DA) 2023-0002 to the City Council. F. That a public hearing was duly called, noticed, and held on said application on October 10, 2023, by the Planning Commission. The Planning Commission adopted Resolution No. 4479 recommending that the City Council approve the DA. G. That a public hearing was duly called, noticed, and held on said application on November 7, 2023, by the City Council. H. That the DA is supported by the following findings: 1. That the DA is consistent with the General Plan and Zoning and the project will be consistent with the objectives, policies, general land uses and programs specified in the General Plan in that residential uses are permitted uses within the Downtown Commercial Core Specific Plan (DCCSP) land use designation and the Downtown Commercial Core Specific Plan (DCCSP, SP-12) zoning district. 2. That the project is compatible with the uses authorized in the district in which the property is located. 3. That the project is in conformity with the public necessity, public convenience, general welfare and good land use practices in that the DocuSign Envelope ID: D6D49AF1-372F-4200-8994-5F57C33E90EBDocuSign Envelope ID: E5073C16-5448-4149-87ED-FECA660F4B5F ______________________ Ordinance No. 1538 Page 3 of 5 project would provide forty (40) market-rate for sale units and two (2) affordable housing units for very-low income households for new and existing Tustin residents thereby providing additional options of housing types to the City’s house stock. 4. The project will not be detrimental to the health, safety and general welfare. The project will comply with the DCCSP, TCC, mitigation measures and conditions of approval and other regulations to ensure that the project will not be detrimental to the community. 5. The project will not adversely affect the orderly development of property in that the proposed project is orderly, well designed and equipped with the necessary infrastructure and amenities to support existing and future residents and businesses in the City. 6. That the approval of the DA will provide for two (2) Very Low Income units and payment of affordable housing in-lieu fee. 7. A Fiscal Impact Statement was prepared and submitted along with the DA which verifies that the project would have a positive fiscal impact on the City over and above that of the currently vacant site. I. That the provisions of DA 2023-0002 are consistent with DCCSP and the policies of the General Plan, as evidenced by the following findings: 1. That the project is adjacent to and surrounded by other commercial promoting pedestrian-oriented development and walkability community while maintaining a commercial emphasis of the project area. 2. That a mix of live/work and residential uses are more beneficial to adjacent uses consistent with the overall vision, goals and intent of the DCCSP. J. That the proposed project is consistent with the General Plan Housing Element Goal 1 in that the project would facilitate the provision of an adequate supply of housing to meet the need for a variety of housing types and the diverse socio-economic needs of all community residents and supports State Housing Law as implemented by the Regional Housing Needs Assessment (RHNA). The project provides for forty (40) market-rate for sale units and two (2) affordable units. In furtherance of Goal 1 of the Tustin General Plan Housing Element, the applicant will provide two (2) Very Low Income units on site and pay an in- DocuSign Envelope ID: D6D49AF1-372F-4200-8994-5F57C33E90EBDocuSign Envelope ID: E5073C16-5448-4149-87ED-FECA660F4B5F ______________________ Ordinance No. 1538 Page 4 of 5 lieu affordable housing fee which will be used for development of affordable housing in another location within the City. K.That on June 19, 2018, the Tustin City Council adopted Resolution No. 18- 24 adopting and certifying the Final Environmental Impact Report (EIR) and Mitigation Monitoring and Report Program (MMRP) for the Downtown Commercial Core Specific Plan (DCCSP). L.That the project meets the criteria for statutory exemption from CEQA pursuant to State CEQA Guidelines Section 15182(c). The Section 15182(c) statutory exemption allows residential projects implementing a Specific Plan if a public agency has adopted an Environmental Impact Report (EIR) on a specific plan after January 1, 1980, and no subsequent EIR has been completed. The Downtown Core Commercial Specific Plan EIR was certified in 2018 and none of the conditions described in CEQA Section 15162 calling for the preparation of a subsequent EIR/Notice of Determination have occurred. Therefore, the Planning Commission recommends that the City Council find the project exempt from CEQA pursuant to CEQA Guidelines Section 15182(c). SECTION 2. The City Council hereby approves DA 2023-0002 attached hereto as Exhibit A and subject to final approval of the City Attorney. SECTION 3: The City Manager is hereby authorized to take such actions, and execute such documents and instruments as deemed necessary or desirable to implement the terms of the DA and other documents as necessary. SECTION 4. Severability. If any section, subsection, sentence, clause, phrase, or portion of this ordinance is, for any reason, held to be invalid or unconstitutional by the decision of any court of competent jurisdiction, such decision shall not affect the validity of the remaining portions of this ordinance. The City Council of the City of Tustin hereby declares that it would have adopted this ordinance and each section, subsection, sentence, clause, phrase, or portion thereof irrespective of the fact that any one or more sections, subsections, sentences, clauses, phrases, or portions be declared invalid or unconstitutional. PASSED AND ADOPTED, at a regular meeting of the City Council for the City of Tustin on this day of 2023. DocuSign Envelope ID: D6D49AF1-372F-4200-8994-5F57C33E90EB 21st November DocuSign Envelope ID: E5073C16-5448-4149-87ED-FECA660F4B5F ______________________ Ordinance No. 1538 Page 5 of 5 _________________________________ AUSTIN LUMBARD, Mayor ____________________ _____ ERICA N. YASUDA, City Clerk APPROVED AS TO FORM: ____________________ ____ DAVID E. KENDIG, City Attorney STATE OF CALIFORNIA ) COUNTY OF ORANGE ) SS. CITY OF TUSTIN ) I, Erica N. Yasuda, City Clerk and ex-officio Clerk of the City Council of the City of Tustin, California, do hereby certify that the whole number of the members of the City Council of the City of Tustin is 5; that the above and foregoing Ordinance No. 1538 was duly and regularly introduced at a regular meeting of the Tustin City Council, held on the 7th day of November, 2023 and was given its second reading, passed, and adopted at a regular meeting of the City Council held on the ___ day of ________, 2023 by the following vote: COUNCILMEMBER AYES: COUNCILMEMBER NOES: COUNCILMEMBER ABSTAINED: COUNCILMEMBER ABSENT: COUNCILMEMBER RECUSED: ERICA N. YASUDA, City Clerk Exhibit A – Development Agreement 2023-0002 DocuSign Envelope ID: D6D49AF1-372F-4200-8994-5F57C33E90EB November21st Lumbard, Clark, Gallagher, Gomez, Schnell (5) (0) (0) (0) (0) DocuSign Envelope ID: E5073C16-5448-4149-87ED-FECA660F4B5F 087873\16998268v10 #166356 v4 9184.2 1 1786314.1 DEVELOPMENT AGREEMENT (DA-2023-0002) (Pursuant to California Government Code sections 65864-65869.5) This DEVELOPMENT AGREEMENT (the “Agreement”) is dated for reference purposes as of the ____ day of _______________, 202_ (“Effective Date”), and is being entered into by and between the CITY OF TUSTIN (“City”) and CITY VENTURES HOMEBUILDING, LLC, a California limited liability company (“Developer”). City and Developer are sometimes collectively referred to in this Agreement as the “Parties” and individually as a “Party.” All terms defined in the Agreement shall have the same meaning when used herein. RECITALS A. Developer has an equitable interest in real property constituting approximately two (2) acres in the City of Tustin, County of Orange, State of California, located at 14042 Newport Avenue in the Downtown Commercial Core Specific Plan (“DCCSP”) (APNs # 432-074-07, 432- 074-08, 432-074-09) as legally described on Exhibit A and depicted on Exhibit B attached to this Agreement (the “Property”), and therefore is authorized to enter into this Agreement pursuant to Government Code Section 65865. B. Developer is proposing to develop the Property with thirty-five (35) residential condominium units and seven (7) live/work units, for a total of forty-two (42) units in six (6) buildings, with associated landscaping, public amenity space, and parking (“Project”). Five (5) percent of the base units (thirty-five (35) units) would be affordable to very low-income households, making the Project eligible for a twenty (20) percent density bonus, unlimited waivers, one concession/incentive, and State Density Bonus Law parking standards under State Density Bonus Law. C. In order to encourage investment in, and commitment to, comprehensive planning and strengthen the public planning process and encourage private implementation of the local general plan, provide certainty in the approval of projects in order to avoid waste of time and resources, and reduce the economic costs of development by providing assurance to property owners that they may proceed with projects consistent with existing land use policies, rules, and regulations, the California Legislature adopted California Government Code sections 65864- 65869.5 (the “Development Agreement Statute”) authorizing cities and counties to enter into development agreements with persons or entities having a legal or equitable interest in real property located within their jurisdiction. D. On December 3, 1984, the City Council adopted Ordinance No. 923, codified at Section 9600 et seq. of the Tustin Code Regarding Development Agreements (the “Development Agreement Ordinance”). This Agreement is consistent with the Development Agreement Ordinance. E. Developer shall provide public benefits as provided in this Agreement as consideration for this Agreement. DocuSign Envelope ID: E5073C16-5448-4149-87ED-FECA660F4B5F 087873\16998268v10 2 1786314.1 F. The following land use entitlements for the Project are being adopted and approved by the City Council concurrently with its approval of this Agreement (“Project Approvals”): (1) Subdivision (SUB) 2023-0003/Vesting Tentative Tract Map (VTTM) No. 19164 to subdivide the existing three (3) parcels to one (1) lot for condominium purposes, within multiple Phases (Exhibit C); (2) Design Review (DR) 2023-0019 for thirty-five (35) residential units and seven (7) Live/work units for a total of forty-two (42) attached residential condominium townhomes within six (6) buildings to include 40 market rate and 2 affordable (50% AMI) units, common and private open space and landscaping, and a public amenity space; (3) Final Approval of Residential Allocation Reservation (RAR) 2023-0001; (4) Density Bonus request with five (5) percent of units identified as very-low income housing with a request for density bonus of twenty percent (35 base units, plus seven density bonus units); one (1) concession to remove the requirement for full replacement of frontage improvements along El Camino Real; two (2) waivers to reduce the minimum required ground floor commercial development standards within the Live/work units that include the interior depth from 45 feet to 13 feet-8 inches (13’-8”) and first (1st) floor plate height from sixteen (16) feet to 10’1” feet; and use of State Density Bonus Law parking standards, which allow tandem parking; (5) Development Agreement 2023-0002, consistent with the requirements of the DCCSP. G. On June 19, 2018, the Tustin City Council adopted Resolution No. 18-24 adopting and certifying the Final Environmental Impact Report for the DCCSP. H. The Project Approvals have been evaluated pursuant to the California Environmental Quality Act (“ CEQA”) and determined to be exempt pursuant to Section 15182(c) of the State CEQA Guidelines (Cal. Code of Regs., title 14, Section 15182) and Government Code Section 65457 for Residential Projects Implementing a Specific Plan because none of the factors listed in Public Resources Code Section 21166 have occurred. I. City has determined that the Project, including this Agreement, is consistent with the City’s General Plan and that the Development Agreement complies with the findings established by the Development Agreement Ordinance, in that the Agreement: 1. Is consistent with the objectives, policies, general land uses and programs specified in the General Plan. 2. Is compatible with the uses authorized in the district in which the real property is located. 3. Is in conformity with the public necessity, public convenience, general welfare, and good land use practices. DocuSign Envelope ID: E5073C16-5448-4149-87ED-FECA660F4B5F 087873\16998268v10 3 1786314.1 4. Will not be detrimental to the health, safety, and general welfare. 5. Will not adversely affect the orderly development of Property. 6. Will have a positive fiscal impact on the City. J. City has determined that this Agreement satisfies Developer’s obligation pursuant to the DCCSP to enter into a Development Agreement for a Subdivision Map approval. K. On October ____, 2023, City’s Planning Commission held a public hearing on this Agreement, made findings and determinations with respect to the Project Approvals, including this Agreement, and recommended to the City Council that the City Council approve this Agreement and the other Project Approvals. L. On November 7, 2023, the City Council held a public hearing on this Agreement and considered the Planning Commission’s recommendations and the testimony and information submitted by City staff, Developer, and members of the public, and approved the Project Approvals other than this Agreement, adopting Resolution Nos. ___________. On December 5, 2023, consistent with applicable provisions of the Development Agreement Statute and Development Agreement Ordinance, the City Council adopted Ordinance No. _____ (the “Adopting Ordinance”), finding this Agreement to be consistent with the City of Tustin General Plan and approving this Agreement and authorizing its execution. AGREEMENT NOW, THEREFORE, City and Developer agree as follows: 1. Definitions. In addition to any terms defined elsewhere in this Agreement, the following terms when used in this Agreement shall have the meanings set forth below: “Action” shall have the meaning ascribed in Section 6.6 of this Agreement. “Adopting Ordinance” shall have the meaning ascribed in Recital L of this Agreement. “Agreement” shall mean this Development Agreement. “Applicable Approvals” shall include the Project Approvals described in Recital F of this Agreement and Subsequent Approvals. “Approval Date” means the date this Development Agreement was adopted by ordinance of the City Council. “CEQA” shall mean the California Environmental Quality Act (California Public Resources Code sections 21000-21177) and the implementing regulations promulgated thereunder by the Secretary for Resources (California Code of Regulations, Title 14, Section 15000 et seq.), as the same may be amended from time to time. “City” shall mean the City of Tustin, a California city, and any successor or assignee of the rights and obligations of the City of Tustin hereunder. DocuSign Envelope ID: E5073C16-5448-4149-87ED-FECA660F4B5F 087873\16998268v10 4 1786314.1 “City Council” shall mean the governing body of the City of Tustin. “City’s Affiliated Parties” shall have the meaning ascribed in Section 8.1 of this Agreement. “Claim” shall have the meaning ascribed in Section 8.1 of this Agreement. “Cure Period” shall have the meaning ascribed in Section 6.1 of this Agreement. “Damages” shall have the meaning ascribed in Section 6.2 of this Agreement. “Default” shall have the meaning ascribed to that term in Section 6.1 of this Agreement. “Develop” or “Development” shall mean to improve or the improvement of the Property for the purpose of completing the structures, improvements, and facilities comprising the Project, including but not limited to: grading; the construction of infrastructure and public facilities related to the Project, whether located within or outside the Property; the construction of all of the private improvements and facilities comprising the Project; the preservation or restoration, as required of natural and man-made or altered open space areas; and the installation of landscaping. The terms “Develop” and “Development,” as used herein, do not include the maintenance, repair, reconstruction, replacement, or redevelopment of any structure, improvement, or facility after the initial construction and completion thereof. “Developer” shall mean City Ventures Homebuilding, LLC, a California limited liability company, and any successor or assignee to all or any portion of the right, title, and interest of the Project in and to ownership of all or a portion of the Property. “Development Agreement Ordinance” shall mean the Chapter 6, Part 1, Section 9600 et seq. of the Tustin City Code. “Development Agreement Statute” shall mean California Government Code sections 65864-65869.5, inclusive, as the same may be amended from time to time. “Development Limitation” shall have the meaning ascribed in Section 2.3.4, and shall include the events listed in Article 7. “Development Plan” shall mean all of the land use entitlements, approvals and permits approved by the City for the Project on or before the Approval Date, as the same may be amended from time to time consistent with this Agreement. Such land use entitlements, approvals and permits include, without limitation, the Development Regulations, to the extent provided under this Agreement, the Applicable Approvals and all conditions of approval and all mitigation measures approved for the Project on or before the Approval Date. “Development Regulations” shall mean the following regulations as they are in effect as of the Approval Date and to the extent they govern or regulate the development of the Property: the General Plan; the Development Plan; and, to the extent not expressly superseded by the Development Plan or this Agreement, all other land use and subdivision regulations governing the permitted uses, density and intensity of use, design, improvement, and construction standards and specifications, procedures for obtaining required City permits and approvals for development, and similar matters that may apply to development of the Project on the Property during the Term of this Agreement that are set forth in the Downtown Commercial Core Specific Plan and the Tustin City Code dealing with buildings and construction, subdivisions and inclusionary housing, DocuSign Envelope ID: E5073C16-5448-4149-87ED-FECA660F4B5F 087873\16998268v10 5 1786314.1 and planning, zoning and density bonus. Notwithstanding the foregoing, the term “Development Regulations,” as used herein, does not include any City ordinance, resolution, code, rule, regulation or official policy governing any of the following: (i) the conduct of businesses, professions, and occupations; (ii) taxes and assessments; (iii) the control and abatement of nuisances; (iv) the granting of encroachment permits and the conveyance of rights and interests which provide for the use of or the entry upon public property; or (v) the exercise of the power of eminent domain. “Effective Date” shall have the meaning ascribed in Section 2.3.1. “Environmental Laws” means all federal, state, regional, county, municipal, and local laws, statutes, ordinances, rules, and regulations which are in effect as of the Effective Date, and all federal, state, regional, county, municipal, and local laws, statutes, rules, ordinances, rules, and regulations which may hereafter be enacted and which apply to the Property or any part thereof, pertaining to the use, generation, storage, disposal, release, treatment, or removal of any Hazardous Substances, including without limitation the following: the Comprehensive Environmental Response Compensation and Liability Act of 1980, 42 U.S.C. Sections 9601, et seq., as amended (“CERCLA”); the Solid Waste Disposal Act, as amended by the Resource Conservation and Recovery Act of 1976, 42 U.S.C. Sections 6901, et seq., as amended (“RCRA”); the Emergency Planning and Community Right to Know Act of 1986, 42 U.S.C. Sections 11001 et seq., as amended; the Hazardous Materials Transportation Act, 49 U.S.C. Section 1801, et seq., as amended; the Clean Air Act, 42 U.S.C. Sections 7401 et seq., as amended; the Clean Water Act, 33 U.S.C. Section 1251, et seq., as amended; the Toxic Substances Control Act, 15 U.S.C. Sections 2601 et seq ., as amended; the Federal Insecticide, Fungicide and Rodenticide Act, 7 U.S.C. Sections 136 et seq., as amended; the Federal Safe Drinking Water Act, 42 U.S.C. Sections 300f et seq., as amended; the Federal Radon and Indoor Air Quality Research Act, 42 U.S.C. Sections 7401 et seq ., as amended; the Occupational Safety and Health Act, 29 U.S.C. Sections 651 et seq., as amended; and California Health and Safety Code Section 25100, et seq. “General Plan” shall mean City’s General Plan in effect on the Approval Date. “Hazardous Substances” means any toxic substance or waste, pollutant, hazardous substance or waste, contaminant, special waste, industrial substance or waste, petroleum or petroleum-derived substance or waste, or any toxic or hazardous constituent or additive to or breakdown component from any such substance or waste, including without limitation any substance, waste, or material regulated under or defined as “hazardous” or “toxic” under any Environmental Law. “Mortgage” shall mean a mortgage, deed of trust, sale and leaseback arrangement, or any other form of conveyance in which the Property, or a part or interest in the Property, is pledged as security and contracted for in good faith and for fair value. “Mortgagee” shall mean the holder of a beneficial interest under a Mortgage or any successor or assignee of the Mortgagee. “Notice of Default” shall have the meaning ascribed in Section 6.1 of this Agreement. “Park Fee Credit” shall have the meaning ascribed in Section 4.1.2. DocuSign Envelope ID: E5073C16-5448-4149-87ED-FECA660F4B5F 087873\16998268v10 6 1786314.1 “Party” or “Parties” shall mean either City or Developer or both, as determined by the context. “Phase” shall mean any Phase depicted on Exhibit C. “Phases” shall mean all of the Phases depicted on Exhibit C, collectively. “Project” shall mean all on-site and off-site improvements that Developer is authorized and/or required to construct with respect to the Property, as provided in this Agreement and the Development Regulations, as the same may be modified or amended from time to time consistent with this Agreement and applicable law in order to carry out the Development Plan. “Property” shall have the meaning ascribed in Recital A of this Agreement. “Public Benefits” means those public benefits to be provided by the Developer and the Project as described in Section 4 of this Agreement that comprise enforceable additional consideration to City for this Agreement. “Recordation Date” shall mean the date this Agreement is recorded in the Office of the Orange County Recorder. “Subsequent Development Approvals” or “Subsequent Approvals” shall mean all discretionary development and building approvals that Developer is required to obtain to Develop the Project on and with respect to the Property after the Approval Date consistent with the Development Regulations and this Agreement, with the understanding that except as expressly set forth herein City shall not have the right subsequent to the Approval Date and during the Term of this Agreement to adopt or impose requirements for any such Subsequent Development Approvals that do not exist as of the Approval Date. “Term” shall have the meaning ascribed in Section 2.3.1 of this Agreement. “Termination Date” shall have the meaning ascribed in Section 2.3.2 of this Agreement. “Transfer” shall have the meaning ascribed in Section 9.1 of this Agreement. 2. General Provisions. 2.1 Binding Effect of Agreement; Authorized Use of Property. The Property is hereby made subject to this Agreement. Development of the Property is hereby authorized and shall be carried out in accordance with the terms of this Agreement and the Development Regulations and the Applicable Approvals, which establish the permitted uses of the Property, the density and intensity of use, the maximum height and size of proposed buildings on the Property and provisions for reservation and dedication of land for public purposes. 2.2 Developer Representations and Warranties Regarding Ownership of the Property and Related Matters Pertaining to this Agreement. Developer and each person executing this Agreement on behalf of Developer hereby represents and warrants to City as follows: (i) that, as of the Effective Date, Developer has an DocuSign Envelope ID: E5073C16-5448-4149-87ED-FECA660F4B5F 087873\16998268v10 7 1786314.1 equitable interest to acquire fee simple title to the Property; (ii) if Developer or any co-owner comprising Developer is a legal entity that such entity is duly formed and existing and is authorized to do business in the State of California; (iii) if Developer or any co-owner comprising Developer is a natural person that such natural person has the legal right and capacity to execute this Agreement; (iv) that all actions required to be taken by all persons and entities comprising Developer to enter into this Agreement have been taken and that Developer has the legal authority to enter into this Agreement; (v) that Developer’s entering into and performing its obligations set forth in this Agreement will not result in a violation of any obligation, contractual or otherwise, that Developer or any person or entity comprising Developer has to any third party; (vi) that neither Developer nor any co-owner comprising Developer is the subject of any voluntary or involuntary bankruptcy or insolvency petition; and (vii) that Developer has no actual knowledge of any pending or threatened claims of any person or entity affecting the validity of any of the representations and warranties set forth in clauses (i)–(vi), inclusive, or affecting Developer’s authority or ability to enter into or perform any of its obligations set forth in this Agreement. 2.3 Effective Date and Term. 2.3.1 Effective Date. The Effective Date of this Development Agreement is stated in the first paragraph of this Development Agreement and represents the later of: (a) thirty (30) days after the date the Ordinance approving this Development Agreement is adopted by the City Council; or, (b) if a referendum petition is timely and duly circulated and filed, the date the election results on the ballot measure by City voters approving this Development Agreement are certified by the City Council in the manner provided by the Elections Code. This Agreement shall be executed by the City within ten (10) days after the Effective Date and recorded as provided in Government Code Section 65868.5. 2.3.2 Term. The term of this Agreement (the “Term”) shall commence on the Recordation Date and shall continue in full force and effect until the Termination Date (as defined below) or five (5) years, whichever occurs first, unless extended pursuant to Section 2.3.4. Following the Termination Date, this Agreement shall be deemed terminated and of no further force and effect; provided however, that said termination of the Agreement shall not affect the Applicable Approvals. 2.3.3 Termination. The “Termination Date” shall be the earliest of the following dates: (i) the expiration of the allocation of the 35 base residential units to the Project, and the redeposit of the units into the Residential Allocation Bank, as set forth in Section 3.1.1 (ii) the fifth (5th) anniversary of the Effective Date as the same may be extended pursuant to Section 2.3.4; (iii) the date of termination of this Agreement by the City in accordance with any of Articles 5, 6 and/or 7 of this Agreement and/or Sections 65865.1 and/or 65868 of the Development Agreement Statute; (iv) the date upon which Developer completes the Project and the Public Benefits in accordance with the terms of this Agreement, the Applicable Approvals and the Development Regulations, including Developer’s complete satisfaction, performance, and payment, as applicable, of all fees, the issuance of all required final occupancy permits for residential units on the Property, and acceptance by City or applicable public agency(ies) or private entity(ies) of all required public improvements and offers of dedication, not to be unreasonably withheld by City; (v) the date of entry of a final court judgment not subject to further appeal setting aside, voiding or annulling the adoption of the Adopting Ordinance or any of the Applicable Approvals; or (vi) the date of adoption of a referendum measure overriding or repealing the Adopting Ordinance. The termination or expiration of this Agreement shall not affect the validity of the Applicable Approvals (other than this Agreement). DocuSign Envelope ID: E5073C16-5448-4149-87ED-FECA660F4B5F 087873\16998268v10 8 1786314.1 2.3.4 Extensions. Notwithstanding the Parties’ expectation that there will be no limit or moratorium upon the Project’s development or the issuance of building or other development related permits during the Term, the Parties understand and agree that various third parties may take action or other events outside the Parties’ control, including as listed in Article 7, may occur causing a de facto “Development Limitation.” Consequently, the Term and the obligations imposed pursuant to this Agreement shall be extended day for day for any delay arising from a Development Limitation, including a timely filed lawsuit challenging the validity or legality of the Adopting Ordinance, this Agreement, and/or any of the Applicable Approvals, until the date on which said challenge is finally resolved in favor of the validity or legality of the Adopting Ordinance, this Agreement, and/or the Applicable Approvals, whether such finality is achieved by a final non-appealable judgment, voluntary or involuntary dismissal (and the passage of any time required to appeal an involuntary dismissal), or binding written settlement agreement. Each Party shall promptly notify the other Party to this Agreement upon learning of any Development Limitation. 3. Development of Project. 3.1 Development Regulations for the Project Approvals. 3.1.1 Life of the Project Approvals. Developer shall have the right but not the obligation to develop the Project under the terms of the Project Approvals, including this Agreement. Following final approval of RAR 2023-0001 and the Applicable Approvals all construction related permits for the Project, including demolition, grading, and building permits, must be obtained during the life of the Vesting Tentative Tract Map (“VTTM”). Following building permit issuance, construction on the first building must commence within 180 days, except if this time period is automatically extended pursuant to Article 7. Other time extensions may be considered at the discretion of the City Community Development Director (“Director”), not to be unreasonably withheld. Developer’s precise grading permit application shall comply with all requirements specified in Tustin City Code section 8909. The allocation of the 35 base residential units to the Project shall expire and the units redeposited into the Residential Allocation Bank for use by other projects if the first construction-related permit is not obtained within the required time limits or approved for extension, or the permit is not utilized, as evidenced by the commencement of construction, including grading, within the time allowed pursuant to this Section 3.1.1. Notwithstanding the foregoing, if the City alters the RAR process to provide that an RAR recipient has more time to use an RAR than provided in this Agreement, Developer shall be provided an equivalent extension of time to use its RAR. If the City rescinds the RAR requirement, Developer’s RAR shall not expire. 3.1.2 Purpose. Developer has expended and will continue to expend substantial amounts of time and money planning and preparing for Development of the Project. Developer represents and City acknowledges that Developer would not make these expenditures without this Agreement, and that Developer is and will be making these expenditures in reasonable reliance upon its vested rights to Develop the Project as set forth in this Agreement. For this reason, City agrees to process all Subsequent Approvals expeditiously, and within the time provided by Government Code section 65913.3. City shall prioritize the processing of all Subsequent Approvals to ensure that the purpose of this Agreement is not frustrated. 3.1.3 Amendments. Developer may apply to City for permits or approvals necessary to modify or amend the Development specified in the Project Approvals, provided that the request does not propose an increase in the maximum density, intensity, height, or size of proposed structures, or a change in use that generates more peak hour traffic or more daily traffic DocuSign Envelope ID: E5073C16-5448-4149-87ED-FECA660F4B5F 087873\16998268v10 9 1786314.1 and, in addition, Developer may apply to City for approval of minor amendments to existing tentative tract maps, tentative parcel maps, or associated conditions of approval, consistent with the Tustin City Code. This Agreement does not constitute a promise or commitment by City to approve any such permit or approval, or to approve the same with or without any particular requirements or conditions, and City’s discretion with respect to such matters shall be the same as it would be in the absence of this Agreement. 3.1.4 Vested Elements and Rights. Developer shall have the vested right to complete development of the Property in accordance with the Development Plan. Developer’s vested rights include all rights vested by the VTTM and rights provided by this Agreement. This Agreement is not intended to lessen the vested rights provided by the VTTM, including the vesting of Development Impact Fees (defined in Section 3.1.5), and in the event of a conflict between this Agreement and the vested rights provided by the VTTM, the vested rights provided by the VTTM control. 3.1.5 Fees. Consistent with Government Code section 66007, Development Impact Fees shall be paid on the date of the final inspection, or the date the certificate of occupancy is issued, whichever occurs first. Development Impact Fees shall be paid on a pro rata basis for each dwelling when it receives its final inspection or certificate of occupancy, whichever occurs first. The term “Development Impact Fees” means those fees imposed or levied by the City with respect to development and/or its impacts pursuant to applicable governmental requirements, including Government Code Sections 66000 et seq., including impact fees, fees or charges for the construction of public improvements or facilities, park and recreation fees, linkage fees, exactions, assessments, fair share charges, or other similar impact fees or charges imposed on or in connection with new development. Development Impact Fees do not include (1) City Processing Fees, as defined in Section 3.4.2, or (2) regional pass-through fees imposed by other agencies and charged by the City. 3.2 Other Governmental or Quasi-Governmental Permits. Developer shall apply for such other permits and approvals as may be required by non- City governmental or quasi-governmental agencies having regulatory jurisdiction over the Project (such as public utilities or special districts, or other federal or state resource agencies) to the extent required for the development of, or provision of, services and facilities to the Project as set forth in the Development Plan. The City shall cooperate with and assist Developer in obtaining such permits and approvals, and, where necessary in making application for such approvals or permits. Developer shall be solely responsible for all costs and shall be responsible for the processing of all such permits. 3.3 No Conflicting Enactments. Except to the extent City reserves its discretion as expressly set forth in this Agreement (including, without limitation, as set forth in Section 3.4 and Article 4 of this Agreement), during the Term of this Agreement, the City shall not apply to the Project or the Property any ordinance, policy, rule, regulation, or other measure relating to Development of the Project that is enacted or becomes effective after the Approval Date to the extent it conflicts with this Agreement. In Pardee Construction Co. v. City of Camarillo (1984) 37 Cal.3d 465, the California Supreme Court held that a construction company was not exempt from a city’s growth control ordinance even though the city and construction company had entered into a consent judgment (tantamount to a contract under California law) establishing the company’s vested rights to develop its property consistent with the zoning. The California Supreme Court reached this result because the consent judgment DocuSign Envelope ID: E5073C16-5448-4149-87ED-FECA660F4B5F 087873\16998268v10 10 1786314.1 failed to address the timing of development. The Parties intend to avoid the result of the Pardee case by acknowledging and providing in this Agreement that Developer shall have the vested right to Develop the Project on and with respect to the Property at the rate, timing, and sequencing that Developer deems appropriate within the exercise of Developer’s sole subjective business judgment, provided that such Development occurs in accordance with this Agreement and the Development Regulations, notwithstanding adoption by City’s electorate of an initiative to the contrary after the Approval Date. No City moratorium or other similar limitation relating to the rate, timing, or sequencing of the Development of all or any part of the Project and whether enacted by initiative or another method, affecting subdivision maps, building permits, occupancy certificates, or other entitlement to use, shall apply to the Project to the extent such moratorium or other similar limitation restricts Developer’s vested rights in this Agreement or otherwise conflicts with the express provisions of this Agreement. 3.4 Reservations of Authority. Notwithstanding any other provision set forth in this Agreement to the contrary, the laws, rules, regulations, and official policies set forth in this Section 3.4 shall apply to and govern the Development of the Project on and with respect to the Property. 3.4.1 Procedural Regulations. Procedural regulations relating to hearing bodies, petitions, applications, notices, findings, records, hearings, reports, recommendations, appeals, and any other matter of procedure shall apply to the Property, provided that such procedural regulations are adopted and applied City-wide or to all other properties similarly situated in City. 3.4.2 Processing and Permit Fees. City shall have the right to charge and Developer shall be required to pay (a) all applicable processing and permit fees to cover the reasonable cost to City of (i) processing and reviewing applications and plans for any Applicable Approvals, Subsequent Development Approvals, building permits, excavation and grading permits, encroachment permits, plan checking, site review and approval, administrative review, and similar fees imposed to recover City’s costs associated with processing, reviewing, and inspecting Project applications, plans and specifications, (ii) inspecting the work constructed or installed by or on behalf of Developer, and (iii) monitoring compliance with any requirements applicable to Development of the Project, in each case at the rates in effect at the time fees are due and (b) all costs incurred by the City performance of necessary studies and reports in connection with the foregoing and its obligations under this Agreement (collectively, the “City Processing Fees”). 3.4.3 Consistent Future City Regulations. City ordinances, resolutions, regulations, and official policies governing Development which do not conflict with the Development Regulations, or with respect to such regulations that do conflict, where Developer has consented in writing to the regulations, shall apply to the Property. 3.4.4 Overriding Federal and State Laws and Regulations. Federal and state laws and regulations that override Developer’s vested rights set forth in this Agreement shall apply to the Property, together with any City ordinances, resolutions, regulations, and official policies that are necessary to enable City to comply with the provisions of any such overriding federal or state laws and regulations, provided that (i) Developer does not waive its right to challenge or contest the validity of any such purportedly overriding federal, state, or City law or regulation; and (ii) upon the discovery of any such overriding federal, state, or City law or regulation that prevents or precludes compliance with any provision of this Agreement, City or Developer shall provide to the other Party a written notice identifying the federal, state, or City law or regulation, together with a DocuSign Envelope ID: E5073C16-5448-4149-87ED-FECA660F4B5F 087873\16998268v10 11 1786314.1 copy of the law or regulation and a brief written statement of the conflict(s) between that law or regulation and the provisions of this Agreement. Promptly thereafter City and Developer shall meet and confer in good faith in a reasonable attempt to determine whether a modification or suspension of this Agreement, in whole or in part, is necessary to comply with such overriding federal, state, or City law or regulation. In such negotiations, City and Developer agree to preserve the terms of this Agreement and the rights of Developer as derived from this Agreement to the maximum feasible extent while resolving the conflict. City agrees to cooperate with Developer at no cost to City in resolving the conflict in a manner which minimizes any financial impact of the conflict upon Developer. City also agrees to process in a prompt manner Developer’s proposed changes to the Project and any of the Development Regulations as may be necessary to comply with such overriding federal, state, or City law or regulation; provided, however, that the approval of such changes by City shall be subject to the sole discretion of City, consistent with this Agreement. 3.4.5 Public Health and Safety. Any City ordinance, resolution, rule, regulation, program, or official policy that is necessary to protect persons on the Property or in the immediate vicinity from conditions dangerous to their health or safety, as reasonably determined by City, shall apply to the Property, even though the application of the ordinance, resolution, rule regulation, program, or official policy would result in the impairment of Developer’s vested rights under this Agreement. 3.4.6 Uniform Building Standards. Existing and future building and building- related standards set forth in the uniform codes adopted by City and any local amendments to those codes adopted by the City, including without limitation building, plumbing, mechanical, electrical, housing, swimming pool, and fire codes, and any modifications and amendments thereof shall all apply to the Project and the Property to the same extent that the same would apply in the absence of this Agreement. 3.4.7 Public Works Improvements. To the extent Developer constructs or installs any public improvements, works, or facilities, the City standards in effect for such public improvements, works, or facilities at the time of City’s issuance of a permit, license, or other authorization for construction or installation of same shall apply. 3.4.8 No Guarantee or Reservation of Utility Capacity. Notwithstanding any other provision set forth in this Agreement to the contrary, nothing in this Agreement is intended or shall be interpreted to require City to guarantee or reserve to or for the benefit of Developer or the Property any utility capacity, service, or facilities that may be needed to serve the Project, whether domestic or reclaimed water service, sanitary sewer transmission or wastewater treatment capacity, downstream drainage capacity, or otherwise, and City shall have the right to limit or restrict Development of the Project if and to the extent that City reasonably determines that inadequate utility capacity exists to adequately serve the Project at the time Development is scheduled to commence. Notwithstanding the foregoing, City covenants to provide utility services to the Project on a non-discriminatory basis (i.e., on the same terms and conditions that City undertakes to provide such services to other similarly situated new developments in the City as and when service connections are provided and service commences). 3.5 Applicable Approvals. 3.5.1 Subdivision Map. Pursuant to Government Code Section 66452.6 and any other applicable provisions of the Government Code, the term of the VTTM and any other subdivision or parcel map that is approved for all or any portion of the Property shall be extended DocuSign Envelope ID: E5073C16-5448-4149-87ED-FECA660F4B5F 087873\16998268v10 12 1786314.1 to a date coincident with the Term and, where not prohibited by State law, with any extension of the Term, unless a longer term would result under otherwise applicable State or local law. 3.5.2 Life of Other Applicable Approvals. The term of all other Applicable Approvals shall be automatically extended such that these Applicable Approvals remain in effect for a period of time at least as long as the term of this Agreement. 3.5.3 State Density Bonus Law. Nothing in this Agreement limits Developer’s ability to request State Density Bonus Law benefits, including concessions, incentives, and waivers, to the fullest extent allowed by State Density Bonus Law. 3.6 City Acceptance of Developer Improvements and Obligations To the extent any of Developer’s performance obligations under this Agreement require acceptance or acknowledgment from the City upon completion by Developer, City shall provide written notice of such acceptance or acknowledgement to Developer as evidence of Developer’s satisfaction of said obligation, City’s acceptance not to be unreasonably withheld consistent with the terms of this Agreement. Written notice may take the form of a letter, permit, certificate of completion, certificate of occupancy, or any other form. 4. Public Benefits. 4.1 Provision of Public Benefits. Developer shall provide the following public benefits which shall constitute additional consideration for this Agreement for the benefit of the City (“Public Benefits”): 4.1.1 Public Amenity Space. Consistent with DCCSP Section 6.6(B)(4), the Project includes a 1,392 square foot public amenity space that is easily accessible to the public and includes a decorative wall, seating, landscaping, and lighting, as more specifically identified on Exhibit B and Exhibit D, or such alternative amenities as may be approved by the Director of Community Development and the Director of Parks & Recreation (the “Public Amenity Space”). Therefore, Developer shall construct, in conjunction with and as a part of development of the Initial Phase of Project, as outlined in the Phasing Plan (Exhibit C), the privately owned, publicly accessible Public Amenity Space. Developer shall maintain, or, following formation thereof, shall cause the homeowners’ association (“HOA”) to maintain, the Public Amenity Space at the sole cost of the Developer or HOA, as applicable, and such obligation shall be set forth in the CC&Rs for the Project. Prior and as a condition to recording of the final map, the City shall have the right to review and approve the CC&Rs in order to, among other things, confirm the aforesaid maintenance obligations are set forth therein. 4.1.2 Park Fee Credit. Developer shall dedicate an easement, either on the VTTM or by separate instrument, providing public access to the Public Amenity Space during typical City park hours. Upon dedication of the easement and completion of the Public Amenity Space, Developer shall receive a credit (“Park Fee Credit”) against fees owed to provide parkland, as required by the DCCSP and Tustin City Code section 9331 on a per square foot basis for the actual square footage of land comprising the Public Amenity Space and value of the improvements thereon on the date that the Park Fee Credit is provided. 4.1.3 Affordable for Sale Units. In addition to paying the Affordable In Lieu Fee described in Section 4.1.5 below, Developer shall provide two units (equal to five percent of base DocuSign Envelope ID: E5073C16-5448-4149-87ED-FECA660F4B5F 087873\16998268v10 13 1786314.1 units in the Project) for initial sale to very low-income households (the “Affordable Units”). These units shall be provided consistent with Article 9, Chapter 1 of the Tustin City Code, beginning with Section 9111 and be subject to equity sharing requirements in accordance with Government Code Section 65915 and as further specified in an Affordable Housing Covenant and Equity Sharing Agreement recorded against the Affordable Units. 4.1.4 Affordable In Lieu Fee. Developer shall pay to the City a voluntary workforce housing incentive program in-lieu fee in the amount calculated pursuant to Tustin City Code Section B9923b1 by “… Multiplying the voluntary workforce housing incentive program in-lieu fee by one-half (½) the number of base units provided on-site…” [(Per Program In-Lieu Fee) x (Base Units Provided On-site/ 2)]. (the “Affordable In Lieu Fee”) The Affordable In Lieu Fee for each residential unit shall be paid upon the certificate of occupancy for that unit. The program in-lieu fee amount used to calculate the Affordable In Lieu Fee for the Project shall be $14,478 per unit. 5. Annual Review of Developer’s Compliance With Agreement. 5.1 General. City shall review this Agreement once during every twelve (12) month period following the Effective Date for compliance with the terms of this Agreement as provided in Government Code Section 65865.1 and Tustin City Code Section 9617. Developer (including any successor to the owner executing this Agreement on or before the date the Effective Date) shall pay City the published hourly fee for planning staff and City Attorney review in effect at the time of the review, which is deemed sufficient to cover the actual and necessary costs for the annual review. City’s failure to timely provide or conduct an annual review shall not constitute a Default hereunder by City. A failure to timely request an annual review shall not constitute a breach of this Agreement or a Default by Developer. 5.2 Developer Obligation to Demonstrate Good Faith Compliance. During each annual review by City, Developer is required to demonstrate good faith compliance with the material terms of the Agreement. Upon City request, which shall be issued no later than thirty (30) days prior to the anniversary of the Effective Date during the Term, Developer agrees to furnish such evidence of good faith compliance in a written report. The report may be the same report prepared to show compliance with the conditions of the Project Approvals, provided, however, that the annual review process hereunder shall review compliance by Developer with its obligations under this Agreement only and shall not review compliance with Project-related issues not covered by this Agreement. 5.3 Procedure. The City shall conduct its annual review of the Agreement in accordance with Tustin City Code Section 9617, as in effect on the Approval Date. 5.4 Annual Review a Non-Exclusive Means for Determining and Requiring Cure of Developer’s Default. The annual review procedures set forth in this Article 5 shall not be the exclusive means for City to identify a Default by Developer or limit City’s rights or remedies for any such Default. The annual review procedures set forth in Tustin City Code Section 9617 (as of the Approval Date) and this Article 5 shall supplement and shall not replace that provision of Article 6 of this DocuSign Envelope ID: E5073C16-5448-4149-87ED-FECA660F4B5F 087873\16998268v10 14 1786314.1 Agreement whereby either City or Developer may, at any time, assert matters which either Party believes have not been undertaken in accordance with this Agreement by delivering a written Notice of Breach and following the procedures set forth in Section 5.1. 6. Events of Default. 6.1 General Provisions. In the event of any default, breach, or violation of the terms of this Agreement (“Default”), the Party alleging a Default shall have the right to deliver a written notice (each, a “Notice of Default”) to the defaulting Party. The Notice of Default shall specify the nature of the alleged Default and a reasonable manner and sufficient period of time (ten (10) days if the Default relates to the failure to timely make a monetary payment due hereunder and thirty (30) days in the event of non-monetary Defaults) in which the Default must be cured (the “Cure Period”). Developer or City, as applicable, shall have the ability to contest the validity of the alleged Default for a period of five (5) days after Developer or City receives the written Notice of Default. The Parties shall meet and confer in good faith for fifteen (15) days to attempt to resolve the validity of the Notice of Default. If the Parties are unable to resolve the validity of the Notice of Default after this meet and confer, the Cure Period timeframes specified in this Section 6.1 shall apply. During the Cure Period, the Party charged shall not be considered in Default for the purposes of termination of this Agreement or institution of legal proceedings. If the alleged Default is cured within the Cure Period, then the Default thereafter shall be deemed not to exist. If however, a non-monetary Default cannot be cured within such thirty (30) day period, as long as the defaulting Party does each of the following: i. notifies 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; ii. notifies the non-defaulting Party in writing of the defaulting Party's proposed course of action to cure the Default; iii. promptly commences to cure the Default within the thirty (30) day period; iv. makes periodic written reports to the non-defaulting Party as to the progress of the program of cure; and v. 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. 6.2 City's Remedies. In the event of a Default by Developer under this Agreement that is not cured during the Cure Period, City, 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. However, except as provided in Section 6.6 below with respect to recovery of legal expenses, City agrees and covenants on behalf of itself and its successors and assigns, not to sue Developer for damages or monetary relief for any breach of this Agreement or arising out of or connected with any dispute, controversy or issue DocuSign Envelope ID: E5073C16-5448-4149-87ED-FECA660F4B5F 087873\16998268v10 15 1786314.1 regarding the application or effect of this Agreement, or for general, special, compensatory, expectation, anticipation, indirect, consequential, exemplary or punitive damages (“Damages”) arising out of or connected with any dispute, controversy, or issues regarding the application or effect of this Agreement, the Applicable Approvals, the Development Plan, the Development Regulations, or any permits or entitlements sought in connection development or use of the Property or Project, or any portion thereof. City acknowledges that Developer would not have entered into this Agreement if Developer could be held liable for Damages for any default or breach arising out of this Agreement and that City has adequate remedies other than Damages and that this Section shall apply to any successor, assignee, or transferee of the Developer. Furthermore, City, in addition to or as an alternative to exercising the remedies in this Section 6.2, in the event of a material default by Developer, may give notice of its intent to terminate or modify this Agreement pursuant to Tustin City Code Section 9618, in which event the matter shall be scheduled for consideration and review by the City Council. 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). 6.3 Developer's Remedies. In the event that City is in material default under this Agreement, Developer shall be entitled to any or all of the following remedies: (1) Seeking mandamus or special writs, injunctive relief, or specific performance of this Agreement; (2) Modifications or termination of this Agreement; or (3) Seeking any other remedy available at law or in equity, provided, however, except as provided in Section 6.6 below with respect to recovery of legal expenses, Developer agrees and covenants on behalf of itself and it successors and assigns, not to sue City for Damages arising out of or connected with any dispute, controversy, or issues regarding the application or effect of this Agreement, the Applicable Approvals, the Development Plan, the Development Regulations, or any permits or entitlements sought in connection with development or use of the Property or Project, or any portion thereof, except as may be authorized under the Housing Accountability Act (Government Code section 65589.5). Developer acknowledges that City would not have entered into this Agreement if City could be held liable for Damages for any default or breach arising out of this Agreement and that Developer has adequate remedies other than Damages, to secure City’s compliance with its obligations under this Agreement. Therefore, Developer agrees that City, its officers, employees and agents shall not be liable for any Damages and that this Section shall apply to any successor, assignee or transferee of the Developer. 6.4 Waiver. Failure or delay by either Party in delivering a Notice of Default shall not waive that Party’s right to deliver a future Notice of Default of the same or any other Default. 6.5 No Personal Liability of City Officials, Employees, or Agents. No City official, employee, or agent shall have any personal liability hereunder for a Default by City of any of its obligations set forth in this Agreement. 6.6 Recovery of Legal Expenses by Prevailing Party in Any Action. In any judicial proceeding, arbitration, or mediation (collectively, an “Action”) between the Parties that seeks to enforce the provisions of this Agreement or arises out of this Agreement, the prevailing Party shall recover all of its actual and reasonable costs and expenses, regardless of whether they would be recoverable under California Code of Civil Procedure Section 1033.5 or DocuSign Envelope ID: E5073C16-5448-4149-87ED-FECA660F4B5F 087873\16998268v10 16 1786314.1 California Civil Code Section 1717 in the absence of this Agreement. These costs and expenses include court costs, expert witness fees, attorneys’ fees, and costs of investigation and preparation before initiation of the Action. The right to recover these costs and expenses shall accrue upon initiation of the Action, regardless of whether the Action is prosecuted to a final judgment or decision. 7. Force Majeure. Neither Party shall be deemed to be in Default where failure or delay in performance of any of its obligations under this Agreement is caused, through no fault of the Party whose performance is prevented or delayed, by floods, rain events exceeding ten (10) days, earthquakes, other acts of God, fires, wars, riots or similar hostilities, strikes or other labor difficulties, state or federal regulations, pandemics, or court actions. Except as specified above, nonperformance shall not be excused because of the act or omission of a third person. Performance by any Party of its obligations hereunder shall be excused and the required date for performance thereof shall be extended day for day during any period of “Permitted Delay” as hereinafter defined. For purposes hereof, Permitted Delay shall mean delay beyond the reasonable control and without the fault of the Party claiming the delay (and despite the good faith efforts of such Party). Any Party claiming a Permitted Delay shall notify the other Party (or Parties) in writing of such delay within 30 days after the commencement of the delay, which notice shall specify the nature and estimated length of the Permitted Delay (“Permitted Delay Notice”). An extension of time hereunder for any Permitted Delay shall be for the period of the Permitted Delay and shall be deemed granted if the Party receiving the permitted Delay Notice does not object to such extension in writing, as not complying with the provisions of this Section, within 15 days after receiving the Permitted Delay Notice. Upon such an objection, the Parties shall meet and confer within 30 days after the date of the objection in a good faith effort to resolve their disagreement as to the existence and length of the Permitted Delay. 8. Cooperation in the Event of Legal Challenge 8.1 Indemnity Arising From Acts or Omissions of Developer. Except to the extent caused by the intentional misconduct or actively negligent acts, errors or omissions of City or one or more of City’s officials, employees, agents, attorneys and contractors (collectively, the “City’s Affiliated Parties”), Developer shall indemnify, defend, and hold harmless City and City’s Affiliated Parties from and against all actions, suits, claims, liabilities, losses, damages, penalties, obligations and expenses (including but not limited to attorneys’ fees, expert witness fees and court costs) (collectively, a “Claim”) that may arise, directly from the acts, omissions, or operations of Developer or Developer’s officers, agents, contractors, subcontractors, agents, or employees in the course of Development of the Project or any other activities of Developer relating to the Property or pursuant to this Agreement. City shall have the right to select and retain counsel to defend any Claim filed against City and/or any of City’s Affiliated Parties, and Developer shall pay the reasonable cost for defense of any Claim. The indemnity provisions in this Section 8.1 shall be effective on the date on which the Adopting Ordinance is approved by the City Council and shall survive the Termination Date. 8.2 Third Party Litigation. 8.2.1 Cooperation in Defense. In the event of any administrative, legal or equitable action instituted by a third party challenging the validity of any provision of this Agreement, the procedures leading to its adoption, or the Applicable Approvals for the Project, DocuSign Envelope ID: E5073C16-5448-4149-87ED-FECA660F4B5F 087873\16998268v10 17 1786314.1 Developer and City each shall have the right, in its sole discretion, to elect whether or not to defend such action, to select its own counsel and to control its participation and conduct in the litigation in all respects permitted by law. If both Parties elect to defend, the Parties hereby agree to affirmatively cooperate in defending said action and to execute a joint defense and confidentiality agreement to share and protect information, under the joint defense privilege recognized under applicable law. As part of the cooperation in defending an action, City and Developer shall coordinate their defense to make the most efficient use of legal counsel and to share and protect information. Developer and City shall each have sole discretion to terminate its defense at any time. If Developer elects not to defend any such third-party action, City retains the option to undertake such defense, including selecting and employing independent defense counsel at its own expense, without any Developer obligation to indemnity or defend City. If the Parties both determine to defend the action and enter into a joint defense and confidentiality agreement, Developer agrees to pay for defense counsel for City; provided, however, Developer shall jointly participate in the selection of such counsel. The City shall not settle any third-party litigation of Applicable Approvals without Developer’s consent, which consent shall not be unreasonably withheld, conditioned or delayed. 8.2.2 Actions Furthering the Project During Litigation. The filing of any third-party lawsuit(s) against City or Developer relating to this Agreement, the Applicable Approvals or other development issues affecting the Property shall not delay or stop the development, processing or construction of the Project or approval of any Subsequent Approvals, unless the third party obtains a court order preventing the activity. City shall not stipulate to or cooperate in the issuance of any such order. Developer understands the risk of proceeding with development during third- party litigation and will not seek reimbursement from the City of Processing Fees or other amounts expended on development during third-party litigation regardless of the outcome of that litigation. 8.2.3 Revision to Project After Legal Action. In the event of a court order issued as a result of a successful legal challenge, City shall, to the extent permitted by law or court order, in good faith seek to comply with the court order in such a manner as will maintain the integrity of the Applicable Approvals and avoid or minimize to the greatest extent possible (i) any impact to the development of the Project as provided for in, and contemplated by this Agreement, or (ii) any conflict with the this Agreement or frustration of the intent or purpose of this Agreement. 8.2.4 Defense of Agreement. City shall take all actions that are necessary or advisable to uphold the validity and enforceability of this Agreement. If this Agreement is adjudicated or determined to be invalid or unenforceable, City agrees, subject to all legal requirements, to consider modifications to this Agreement to render it valid and enforceable to the extent permitted by applicable law 8.2.5 Indemnification. In addition to its indemnity obligations set forth in Section 8.1, Developer shall indemnify, defend, and hold harmless City and City’s Affiliated Parties from and against any third-party Claim against City or City’s Affiliated Parties seeking to attack, set aside, void, or annul the approval of the Project, this Agreement, the Adopting Ordinance, any of the Development Regulations for the Project (including without limitation any actions taken pursuant to CEQA with respect thereto), any Subsequent Development Approval, or the approval of any permit or entitlement granted pursuant to this Agreement. Said indemnity obligation shall include, without limitation, payment of attorney’s fees, expert witness fees, and court costs. City shall promptly notify Developer of any such Claim and City shall cooperate with Developer in the defense of such Claim. City shall be entitled to retain separate counsel to represent City against the Claim and the City’s defense costs for its separate counsel shall be included in Developer’s indemnity obligation, provided that such counsel shall reasonably DocuSign Envelope ID: E5073C16-5448-4149-87ED-FECA660F4B5F 087873\16998268v10 18 1786314.1 cooperate with Developer in an effort to minimize the total litigation expenses incurred by Developer, as more specifically stated in Section 8.2.1. The indemnity provisions in this Section shall be effective on the date on which the Adopting Ordinance is approved by the City Council and shall survive expiration of the Term or earlier termination of this Agreement. This Section 8.2.5 is intended to be interpreted consistent with Government Code section 66474.9. 8.3 Environmental Indemnity. In addition to its indemnity obligations set forth in Section 8.1, from and after the date on which the Adopting Ordinance is approved by the City Council, Developer shall indemnify, defend, and hold harmless City and City’s Affiliated Parties from and against any and all Claims for personal injury or death, property damage, economic loss, statutory penalties or fines, and damages of any kind or nature whatsoever, including without limitation attorney’s fees, expert witness fees, and court costs, based upon or arising from any of the following: (i) the actual or alleged presence of any Hazardous Substance on or under any of the Property in violation of any applicable Environmental Law; (ii) the actual or alleged migration of any Hazardous Substance from the Property through the soils or groundwater to a location or locations off of the Property; and (iii) the storage, handling, transport, or disposal of any Hazardous Substance on, to, or from the Property and any other area disturbed, graded, or developed by Developer in connection with Developer’s Development of the Project. The indemnity provisions in this Section 8.3 shall be effective on the date on which the Adopting Ordinance is approved by the City Council or Developer acquires the Property, whichever is later, and shall survive the Termination Date. For purposes of this Section 8.3, “Hazardous Substance” means any Hazardous Substance as defined in Section 1, above, that is or was used, stored, placed on the Property by Developer, or exposed or exacerbated by Developer in conjunction with Project development. 8.4 Labor Laws. Developer shall carry out the construction of the Project, including all improvements, in conformity with all Development Regulations including all applicable federal and state labor laws and regulations and shall investigate the applicability of and, if and to the extent applicable, pay prevailing wages meeting the requirements of such laws and regulations; provided that Developer reserves the right to reasonably contest such laws and regulations. Developer hereby agrees that, with respect to the Project, Developer shall be fully responsible for determining whether the foregoing wage requirements are applicable and agrees to indemnify, defend and hold the City and its elected and appointed officials, employees, agents, attorneys, affiliates, representatives, contractors, successors and assigns free and harmless from and against any and all Claims arising from or related to compliance by Developer or Developer’s officers, directors, employees, agents, representatives, consultants and/or contractors (at every tier) in construction of the Project with the prevailing wage requirements imposed by any applicable federal and State labor laws. 9. Assignment. 9.1 Right to Transfers. Developer shall have the right, upon approval of City, which approval shall not be unreasonably withheld, to sell, transfer or assign (hereinafter, a “Transfer” or “Transfers”) Developer’s interest in this Agreement and the Property, in whole or in part, to a third party acquiring an interest or estate in the Property or any portion thereof (such successor, a “Permitted DocuSign Envelope ID: E5073C16-5448-4149-87ED-FECA660F4B5F 087873\16998268v10 19 1786314.1 Transferee”) and such successor, as of the effective date of the Transfer, shall become the “Developer” under this Agreement; provided, however, that no such Transfer shall violate the provisions of the Subdivision Map Act (Government Code section 66410 et seq.) or City’s local subdivision ordinance and each Transfer shall be made in strict compliance with the conditions precedent set forth in Sections 9.3 and 9.4. Any Permitted Transferee shall have all of the same rights, benefits, duties, obligations, and liabilities of Developer under this Agreement with respect to the portion of, or interest in, the Property sold, transferred, and assigned to such Permitted Transferee; provided, however, that in the event of a Transfer of less than all of the Property, or interest in the Property, no such Permitted Transferee shall have the right to enter into an amendment of this Agreement that jeopardizes or impairs the rights or increases the obligations of the Developer with respect to the balance of the Property. The requirement for City consent of a Transfer relates to a Transfer to one or more entities that will undertake some or all of the Project development or construction and does not extend to a Transfer to Project end users, including future residents, tenants, or a homeowners’ association. 9.2 Transfers Permitted Without City Consent. Notwithstanding Section 9.1, the following Transfers shall not require City consent: (i) the conveyance, dedication, or granting of easements to an agency, municipality, or utility district, such as utility or public access easements, necessary for Project development; (ii) transactions for financing purposes, including as needed to secure funds necessary for Project construction, and (iii) transactions with a “Developer Affiliate,” which is an entity or person that is directly or indirectly controlling, controlled by, or under common control with Developer. In the event of a Transfer to a Developer Affiliate, Developer shall provide notice to the City in the form of the Assignment and Assumption Agreement, as defined in Section 9.5, within ten (10) days after the Transfer. 9.3 City Consideration of Requested Assignment. When consent of a transfer is required, the City agrees that it will not unreasonably withhold, condition, or delay approval of a request for approval of a Transfer made pursuant to this Article 9 that requires City approval, provided the Developer delivers written notice to the City requesting such approval, consistent with Section 9.4. Such notice shall be accompanied by evidence regarding the proposed assignee’s development and/or operational qualifications and experience and its financial commitments and resources in sufficient detail to enable the City to evaluate the proposed assignee pursuant to the criteria set forth in this Article 9. The City may, in considering any such request, take into consideration such factors as, without limitation, the assignee’s experience and expertise, the assignee’s past performance as developer or operator of similar developments, and the assignee’s current financial condition and capabilities. 9.4 City Approval of Transferee. Prior to the effective date of any proposed Transfer requiring City consent, Developer (as transferor) shall: i. Notify the City, in writing, of such proposed Transfer, consistent with Section 9.3; and ii. Deliver to the City an Assignment and Assumption Agreement, as defined in Section 9.5. DocuSign Envelope ID: E5073C16-5448-4149-87ED-FECA660F4B5F 087873\16998268v10 20 1786314.1 Within five (5) days after the receipt of Developer’s written notice requesting City approval of a Transfer, the City shall either approve or disapprove the proposed Transfer or shall respond in writing by stating what further information, if any, the City reasonably requires to determine the request complete and determine whether or not to grant the requested approval. Upon receipt of such a response, Developer shall promptly provide to the City the requested information. Within five (5) days after the receipt of such information, the City shall approve or disapprove the requested Assignment. If no response is received from the City with the requisite time period set for in this Section 9.4, the Transfer is deemed approved. 9.5 Assignment and Assumption Agreement. Prior to any Assignment (whether or not an Assignment requiring the City’s consent), Developer shall give written notice to City of the Assignment and satisfactory evidence that the assignee has assumed in writing through an assignment and assumption agreement all of the Developer’s obligations set forth in this Agreement (an “Assignment and Assumption Agreement”). The Assignment and Assumption Agreement shall be in the form attached hereto as Exhibit E. 9.6 Liability of Transferor and Transferee. Notwithstanding any Transfer, the transferring Developer shall continue to be jointly and severally liable to City, together with the successor Developer, to perform all of the transferred obligations set forth in or arising under this Agreement unless there is full satisfaction of all of the following conditions, in which event the transferring Developer shall be automatically released from any and all obligations with respect to the portion of the Property so Transferred: (i) the transferring Developer no longer has a legal or equitable interest in the portion of the Property so Transferred other than as a beneficiary under a deed of trust; (ii) the transferring Developer is not then in Default under this Agreement and no condition exists that with the passage of time or the giving of notice, or both, would constitute a Default hereunder; (iii) the transferring Developer has provided City with the Assignment and Assumption Agreement; and (iv) the successor Developer either (A) provides City with substitute security equivalent to any security previously provided by the transferring Developer to City to secure performance of the successor Developer’s obligations hereunder with respect to the Property, or interest in the Property, or the portion of the Property so Transferred or (B) if the transferred obligation in question is not a secured obligation, the successor Developer either provides security reasonably satisfactory to City or otherwise demonstrates to City’s reasonable satisfaction that the successor Developer has the financial resources or commitments available to perform the transferred obligation at the time and in the manner required under this Agreement and the Development Regulations for the Project. In the case of partial Transfers, a default under this Agreement by Developer (as Transferor) shall not be considered or acted upon by the City as a default by the Permitted Transferee and shall not affect the Permitted Transferee's rights or obligations hereunder. Likewise, a default by a Permitted Transferee shall not be considered or acted upon by the City as a default by Developer (as Transferor) and shall not affect Developer's retained rights and obligations hereunder. Notwithstanding the foregoing, if a breach of this Agreement involves an obligation jointly held by both Developer and a Permitted Transferee, the City may avail itself of the remedies specified in Sections 6.1 and 6.2 against both the Developer and Permitted Transferee. 10. Mortgagee Rights. 10.1 Encumbrances on Property. The Parties agree that this Agreement shall not prevent or limit Developer in any manner from encumbering the Property, any part of the Property, or any improvements on the Property DocuSign Envelope ID: E5073C16-5448-4149-87ED-FECA660F4B5F 087873\16998268v10 21 1786314.1 with any Mortgage securing financing with respect to the construction, development, use, or operation of the Project. Notwithstanding section 11.4, the City shall provide to any mortgagee an estoppel certificate in form and content reasonably acceptable to the City within ten (10) days of written request therefor. 10.2 Mortgagee Protection. This Agreement shall not prevent or limit Developer in any manner, at Developer’s sole discretion, 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 (“Mortgage”). No breach of this Agreement shall defeat, render invalid, diminish, or impair the lien of any Mortgage made in good faith and for value. Any acquisition or acceptance of title or any right or interest in the Property or part of the Property by a Mortgagee (whether due to foreclosure, trustee’s sale, deed in lieu of foreclosure, lease termination, or otherwise) shall be subject to all of the terms and conditions of this Agreement. Any Mortgagee who takes title to the Property or any part of the Property shall be entitled to the benefits arising under this Agreement. 10.3 Mortgagee Not Obligated. Notwithstanding the provisions of this Section 10.3, a Mortgagee will not have any obligation or duty under the terms of this Agreement to perform the obligations of Developer or other affirmative covenants of Developer, or to guarantee this performance except that: (i) the Mortgagee shall have no right to develop the Project under the Development Regulations without fully complying with the terms of this Agreement; and (ii) to the extent that any covenant to be performed by Developer is a condition to the performance of a covenant by City, that performance shall continue to be a condition precedent to City’s performance. 10.4 Notice of Default to Mortgagee; Right of Mortgagee to Cure. Each Mortgagee shall, upon written request to City, be entitled to receive written notice from City of: (i) the results of the periodic review of compliance specified in Article 6 of this Agreement, and (ii) any default by Developer of its obligations set forth in this Agreement. Each Mortgagee shall have a further right, but not an obligation, to cure the Default within thirty (30) days after receiving a Notice of Default with respect to a monetary Default and within sixty (60) days after receiving a Notice of Default with respect to a non-monetary Default. If the Mortgagee can only remedy or cure a non-monetary Default by obtaining possession of the Property, then the Mortgagee shall have the right to seek to obtain possession with diligence and continuity through a receiver or otherwise, and to remedy or cure the non-monetary Default within sixty (60) days after obtaining possession and, except in case of emergency or to protect the public health or safety, City may not exercise any of its judicial remedies set forth in this Agreement to terminate or substantially alter the rights of the Mortgagee until expiration of the sixty (60)-day period. In the case of a non-monetary Default that cannot with diligence be remedied or cured within sixty (60) days, the Mortgagee shall have additional time as is reasonably necessary to remedy or cure the Default, provided the Mortgagee promptly commences to cure the non-monetary Default within sixty (60) days and diligently prosecutes the cure to completion. DocuSign Envelope ID: E5073C16-5448-4149-87ED-FECA660F4B5F 087873\16998268v10 22 1786314.1 11. Miscellaneous Terms. 11.1 Notices. Any notice or demand that shall be required or permitted by law or any provision of this Agreement shall be in writing. If the notice or demand will be served upon a Party, it either shall be personally delivered to the Party; deposited in the United States mail, certified, return receipt requested, and postage prepaid; delivered by a reliable courier service that provides a receipt showing date and time of delivery with courier charges prepaid; or provided by electronic mail (“Email”). Any notice delivered by Email shall request a receipt thereof confirmed by Email or in writing by the recipient. The notice or demand shall be addressed as follows: TO CITY: City of Tustin 300 Centennial Way Tustin, CA 92780 Attn: City Manager Email: cityclerk@tustinca.org With a copy to: Woodruff &Smart 555 Anton Boulevard, Ste 1200 Costa Mesa, CA 92626 Attn: David E. Kendig, Esq. Email: cityclerk@tustinca.org TO DEVELOPER: City Ventures Homebuilding, LLC 3121 Michelson Drive #150 Irvine, CA 92612 Attn: Karen Alves Email: kalves@cityventures.com With a copy to: Cox, Castle and Nicholson, LLP 50 California Street, Suite 3200 San Francisco, CA 94111 Attn: Linda C. Klein, Esq. Email: lklein@coxcastle.com Parties may change the address stated in this Section 11.1 by delivering notice to the other Party in the manner provided in this Section 11.1, and thereafter notices to such Party shall be addressed and submitted to the new address. Notices other than Email notices delivered in accordance with this Agreement shall be deemed to be delivered upon the earlier of: (i) the date received or (iii) three business days after deposit in the mail as provided above. The effective date of Email notices shall be the date of receipt, provided such receipt has been confirmed by the recipient. 11.2 Project as Private Undertaking. The Development of the Project is a private undertaking. Neither Party is acting as the agent of the other in any respect, and each Party is an independent contracting entity with respect to the terms, covenants, and conditions set forth in this Agreement. This Agreement forms no partnership, joint venture, or other association of any kind. The only relationship between the DocuSign Envelope ID: E5073C16-5448-4149-87ED-FECA660F4B5F 087873\16998268v10 23 1786314.1 Parties is that of a government entity regulating the Development of private property by the owner or developer of the property. 11.3 Cooperation. Each Party shall cooperate with and provide reasonable assistance to the other Party to the extent consistent with and necessary to implement this Agreement. Upon the request of a Party at any time, the other Party shall promptly execute, with acknowledgement or affidavit if reasonably required, and file or record the required instruments and writings and take any actions as may be reasonably necessary to implement this Agreement or to evidence or consummate the transactions contemplated by this Agreement. 11.4 Estoppel Certificates. At any time, either Party may deliver written notice to the other Party requesting that that Party certify in writing that, to the best of its knowledge: (i) this Agreement is in full force and effect and is binding on the Party; (ii) this Agreement has not been amended or modified either orally or in writing or, if this Agreement has been amended, the Party providing the certification shall identify the amendments or modifications; and (iii) the requesting Party is not in Default in the performance of its obligations under this Agreement and no event or situation has occurred that with the passage of time or the giving of Notice or both would constitute a Default or, if such is not the case, then the other Party shall describe the nature and amount of the actual or prospective Default. The Party requested to furnish an estoppel certificate shall execute and return the certificate within thirty (30) days following receipt. 11.5 Rules of Construction. The singular includes the plural; the masculine and neuter include the feminine; “shall” is mandatory; and “may” is permissive. 11.6 Time Is of the Essence. Time is of the essence regarding each provision of this Agreement as to which time is an element. 11.7 Waiver. The failure by a Party to insist upon the strict performance of any of the provisions of this Agreement by the other Party, and failure by a Party to exercise its rights upon a Default by the other Party, shall not constitute a waiver of that Party’s right to demand strict compliance by the other Party in the future. 11.8 Counterparts. This Agreement may be executed in two or more counterparts, each of which shall be identical and may be introduced in evidence or used for any other purpose without any other counterpart, but all of which shall together constitute one and the same agreement. DocuSign Envelope ID: E5073C16-5448-4149-87ED-FECA660F4B5F 087873\16998268v10 24 1786314.1 11.9 Entire Agreement. This Agreement constitutes the entire agreement between the Parties and supersedes all prior agreements and understandings, both written and oral, between the Parties with respect to the subject matter addressed in this Agreement. 11.10 Severability. The Parties intend that each and every obligation of the Parties is interdependent and interrelated with the other, and if any provision of this Agreement or the application of the provision to any Party or circumstances shall be held invalid or unenforceable to any extent, it is the intention of the Parties that the remainder of this Agreement or the application of the provision to persons or circumstances shall be rendered invalid or unenforceable. The Parties intend that neither Party shall receive any of the benefits of the Agreement without the full performance by such Party of all of its obligations provided for under this Agreement. Without limiting the generality of the foregoing, the Parties intend that Developer shall not receive any of the benefits of this Agreement if any of Developer’s obligations are rendered void or unenforceable as the result of any third party litigation, and City shall be free to exercise its legislative discretion to amend or repeal the Development Regulations applicable to the Property and Developer shall cooperate as required, despite this Agreement, should third party litigation result in the nonperformance of Developer’s obligations under this Agreement. The provisions of this Section 11.10 shall be effective on the date on which the Adopting Ordinance is approved by the City Council and shall survive the Termination Date. 11.11 Construction. This Agreement has been drafted after extensive negotiation and revision. Both City and Developer are sophisticated parties who were represented by independent counsel throughout the negotiations or City and Developer had the opportunity to be so represented and voluntarily chose to not be so represented. City and Developer each agree and acknowledge that the terms of this Agreement are fair and reasonable, taking into account their respective purposes, terms, and conditions. This Agreement shall therefore be construed as a whole consistent with its fair meaning, and no principle or presumption of contract construction or interpretation shall be used to construe the whole or any part of this Agreement in favor of or against either Party. 11.12 Successors and Assigns; Constructive Notice and Acceptance. 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 regard to Development of the Property: (i) is for the benefit of and is a burden upon every portion of the Property; (ii) runs with the Property and each portion thereof; and (iii) is binding upon each Party and each successor in interest during its ownership of the Property or any portion thereof. Every person or entity who now or later owns or acquires any right, title, or interest in any part of the Project or the Property is and shall be conclusively deemed to have consented and agreed to every provision of this Agreement. This Section 11.12 applies regardless of whether the instrument by which such person or entity acquires the interest refers to or acknowledges this Agreement and regardless of whether such person or entity has expressly entered into an assignment and assumption agreement as provided for in Article 9 or is a Permitted Transferee under this Agreement. DocuSign Envelope ID: E5073C16-5448-4149-87ED-FECA660F4B5F 087873\16998268v10 25 1786314.1 11.13 No Third Party Beneficiaries. The only Parties to this Agreement are City and Developer. This Agreement does not involve any third party beneficiaries, and it is not intended and shall not be construed to benefit or be enforceable by any other person or entity. 11.14 Applicable Law and Venue. This Agreement shall be construed and enforced consistent with the internal laws of the State of California, without regard to conflicts of law principles. Any action at law or in equity arising under this Agreement or brought by any Party 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. The Parties waive all provisions of law providing for the removal or change of venue to any other court. 11.15 Section Headings. All Section headings and subheadings are inserted for convenience only and shall not affect construction or interpretation of this Agreement. 11.16 Incorporation of Recitals and Exhibits. All of the Recitals are incorporated into this Agreement by this reference. Exhibits A through E are attached to this Agreement and incorporated by this reference as follows: EXHIBIT DESIGNATION DESCRIPTION A Legal Description of Property B Site Plan C Phasing Plan D Public Amenity Conceptual Plan E Assignment and Assumption Agreement 11.17 Recordation. The City Clerk of City shall record this Agreement and any amendment, modification, or cancellation of this Agreement in the Office of the County Recorder of the County of Orange within the period required by California Government Code Section 65868.5. The date of recordation of this Agreement shall not modify or amend the Approval Date, Effective Date, or Termination Date. DocuSign Envelope ID: E5073C16-5448-4149-87ED-FECA660F4B5F 087873\16998268v10 26 1786314.1 11.18 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. [Signature page follows] DocuSign Envelope ID: E5073C16-5448-4149-87ED-FECA660F4B5F 087873\16998268v10 27 1786314.1 SIGNATURE PAGE TO DEVELOPMENT AGREEMENT “DEVELOPER” CITY VENTURES HOMEBUILDING, LLC, a California limited liability company By: [INSERT] “CITY” CITY OF TUSTIN By: Nicole Bernard, Acting City Manager ATTEST: Erica Yasuda, City Clerk APPROVED AS TO FORM: David E. Kendig, City Attorney DocuSign Envelope ID: E5073C16-5448-4149-87ED-FECA660F4B5F 087873\16998268v10 28 1786314.1 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 Orange ) On ____________________, before me, ____________________________, a 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 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 Orange ) On ____________________, before me, ____________________________, a 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 DocuSign Envelope ID: E5073C16-5448-4149-87ED-FECA660F4B5F 087873\16998268v10 #166356 v4 9184.2 A-1 1786314.1 EXHIBIT A LEGAL DESCRIPTION OF PROPERTY THE LAND REFERRED TO HEREIN BELOW IS SITUATED IN THE CITY OF TUSTIN IN THE COUNTY OF ORANGE, STATE OF CALIFORNIA, AND IS DESCRIBED AS FOLLOWS: PARCEL A: PARCELS 1 THROUGH 3 INCLUSIVE AS SHOWN ON PAGES 2 OF 5 AND 3 OF 5 OF EXHIBIT B ATTACHED TO THAT CERTAIN APPLICATION FOR LOT LINE ADJUSTMENT NO. 93-3 RECORDED MAY 24, 1993 AS INSTRUMENT NO. 1993-0346491 AND RE-RECORDED OCTOBER 26, 1993 AS INSTRUMENT NO. 1993-0728694 OFFICIAL RECORDS OF ORANGE COUNTY, CALIFORNIA. EXCEPTING THEREFROM THOSE PORTIONS INCLUDED WITHIN PARCELS 72842-1 AND 72842-3 AS DESCRIBED IN THAT CERTAIN FINAL ORDER OF CONDEMNATION, SUPERIOR COURT CASE NO. 588620 RECORDED JANUARY 14, 1994 AS INSTRUMENT NO. 1994-0032787 OFFICIAL RECORDS. APN: 432-074-07, 432-074-08, 432-074-09 DocuSign Envelope ID: E5073C16-5448-4149-87ED-FECA660F4B5F #166356 v4 9184.2 B-1 1786314.1 EXHIBIT B SITE PLAN Public Amenity Space (see exhibit D for Conceptual Plan) DocuSign Envelope ID: E5073C16-5448-4149-87ED-FECA660F4B5F #166356 v4 9184.2 C-1 1786314.1 EXHIBIT C PHASING PLAN DocuSign Envelope ID: E5073C16-5448-4149-87ED-FECA660F4B5F #166356 v4 9184.2 D-1 1786314.1 EXHIBIT D PUBLIC AMENITY CONCEPTUAL PLAN DocuSign Envelope ID: E5073C16-5448-4149-87ED-FECA660F4B5F 087873\16998268v10 #166356 v4 9184.2 E-1 1786314.1 EXHIBIT E ASSIGNMENT AND ASSUMPTION AGREEMENT DocuSign Envelope ID: E5073C16-5448-4149-87ED-FECA660F4B5F 087873\16998268v10 #166356 v4 9184.2 E-2 1786314.1 RECORDING REQUESTED BY AND WHEN RECORDED, RETURN TO: CITY OF TUSTIN 300 Centennial Way Tustin, CA 92780 Attn: City Attorney (Space Above This Line For Recorder’s Use) [PARTIAL] ASSIGNMENT AND ASSUMPTION OF DEVELOPMENT AGREEMENT This [PARTIAL] ASSIGNMENT AND ASSUMPTION OF DEVELOPMENT AGREEMENT (“[Partial] Assignment”) is entered into as of ____, 20__ (the “Effective Date”), by and between _____________________________________ (“Assignor”), and ___________________________ (“Assignee”). RECITALS A. CITY VENTURES HOMEBUILDING, LLC, a California limited liability company (collectively “Original Developer” or “Assignor”), and the City of Tustin, a municipal corporation (“City”) entered into that certain “Development Agreement”, dated _____________, and recorded on ________________, as Document No. ___________________ of Official Records, Riverside County (the “Development Agreement” or the “DA”), pursuant to which Original Developer agreed to develop certain property more particularly described in the Development Agreement subject to certain conditions and obligations set forth in the Development Agreement. B. Assignor is [the owner of or Original Developer’s successor-in-interest to] the property more particularly described on Exhibit A attached hereto (the “Assignor Land”), which is [all or a portion] of the property subject to the Development Agreement] C. Assignee is purchasing [all or a portion] of the Assignor Land, as more particularly described on Exhibit B attached here to (the “Property”), from Assignor, in accordance with the terms of that certain [Purchase and Sale Agreement Description] (the “Purchase Agreement”). D. Pursuant to the terms of the Purchase Agreement, Assignor agreed to assign and Assignee agreed to assume certain rights, interests and obligations and other terms and conditions under the Development Agreement, as such right, interests and obligations relate to the Property. E. The purpose of this [Partial] Assignment is to set forth the terms and provisions agreed upon between Assignor and Assignee with respect to the assignment of certain rights and interests and the delegation of certain duties and obligations of Assignor under the DocuSign Envelope ID: E5073C16-5448-4149-87ED-FECA660F4B5F 087873\16998268v10 #166356 v4 9184.2 E-3 1786314.1 Development Agreement, as such rights, interests, duties and obligations relate to the Property. AGREEMENT NOW, THEREFORE, Assignor and Assignee agree as follows: 1. Assignment. Assignor hereby assigns, conveys and transfers to Assignee all rights and interests of Assignor, as the “Developer”, under the Development Agreement to the extent such rights and interests relate to the Property, and Assignee hereby accepts such assignment. [Notwithstanding the foregoing, Assignor shall retain (i) any and all rights under the Development Agreement necessary to perform the Retained Obligations, defined below; and (ii) those specific retained rights set forth on Exhibit C attached hereto (the “Retained Rights”).] 2. Assumption of Obligations. [Except with respect to those specific retained burdens and obligations of Assignor set forth on Exhibit C attached hereto (the “Retained Obligations”),] Assignee hereby assumes all of Assignor’s duties and obligations under the Development Agreement accruing after the date hereof, to the extent such obligations relate to the Property, regardless of whether the obligations originate in the Development Agreement itself or documents executed in connection therewith as a means to effectuate the intent of those provisions, including, without limitation: (a) any indemnity obligations, to the extent applicable to the Property or to Assignee by reason of its ownership of the Property, (b) any obligation to follow and be bound by all applicable rules, regulations and policies, (c) any obligation to pay any fees, assessments or exactions as may be imposed by the Development Agreement, and (d) any obligations arising under the Development Agreement by reason of a default of Assignee under the Development Agreement (with respect to any obligations assumed by Assignee hereunder). Assignee agrees to provide City commercially reasonable assurances of its performance of its obligations under the Development Agreement. Notwithstanding anything to the contrary in this [Partial] Assignment, Assignee acknowledges that the Development Agreement runs with the land, therefore nothing in this [Partial] Assignment shall be construed to excuse Assignee from general compliance with the Development Agreement’s prohibitions, default and cure provisions, and other standard provisions to the extent applicable to the Property. 3. Development Agreement Transfer Provision. Assignor and Assignee understand and agree that this Agreement is required to comply with Section 9.5 of the Development Agreement. 4. Indemnity. Assignee agrees to indemnify, defend and hold harmless Assignor, its affiliated entities and persons, and their respective members, managers, partners, officers, directors, shareholders, employees and agents from any claims, demands, losses, liability, damages, causes of action, costs or expenses (including reasonable attorneys’ fees) made against or suffered by Assignor with regard to any failure by Assignee to perform any term or condition of the Development Agreement, to the extent such term or condition relates to the Property, from and after the date hereof, and Assignor shall indemnify, defend and hold harmless Assignee, its affiliated entities and persons, and their respective members, managers, partners, officers, directors, shareholders, employees and agents from any claims, demands, losses, liability, damages, causes of action, costs or expenses (including reasonable attorneys’ fees) made against or suffered by Assignee with regard to any failure by Assignor to perform any term or condition of the Development Agreement, as it relates to the Property, before the date hereof. 5. Miscellaneous. DocuSign Envelope ID: E5073C16-5448-4149-87ED-FECA660F4B5F 087873\16998268v10 #166356 v4 9184.2 E-4 1786314.1 5.1. Interpretation; Governing Law. This [Partial] Assignment shall be construed according to its fair meaning and as prepared by both parties hereto. This [Partial] Assignment shall be construed in accordance with and governed by the laws of the State of California. 5.2. Attorneys’ and Other Fees. In the event of any dispute between the parties hereto or institution of any action or proceeding to interpret or enforce the provisions of this [Partial] Assignment, or arising out of the subject matter of this [Partial] Assignment or the transaction contemplated hereby, the prevailing party shall be entitled to recover from the losing party all of its costs and expenses incurred, including court costs and reasonable attorney’s fees and expert witness fees. 5.3. Authority. Each of the parties hereto represents and warrants to the other that the person or persons executing this [Partial] Assignment on behalf of such party is or are authorized to execute and deliver this [Partial] Assignment and that this [Partial] Assignment shall be binding upon such party. 5.4. Further Assurances. Assignor and Assignee each agree to do such further acts and things and to execute and deliver such additional agreements and instruments as the other may reasonably request to consummate, evidence, confirm or more fully implement the agreements of the parties as contained herein. 5.5. Execution in Counterparts. This [Partial] Assignment may be executed in several counterparts, and all originals so executed shall constitute one agreement between the parties hereto. 5.6. Conflict. Nothing in this [Partial] Assignment is intended to modify or amend the respective obligations of Assignor and Assignee under the Purchase Agreement between Assignor and Assignee which gave rise to this [Partial] Assignment and, in the event of any conflict between this [Partial] Assignment and the Purchase Agreement, as between Assignor and Assignee the provisions of the Purchase Agreement shall supersede and control over this Partial Assignment. 5.7. Recordation. The parties hereby authorize this [Partial] Assignment to be recorded in the records of Riverside County upon the date hereof. 5.8. Successors and Assigns. This [Partial] Assignment shall be binding upon and inure to the benefit of the respective successors, assigns, personal representatives, heirs and legatees of Assignor and Assignee. 5.9. Notice. All notices to Assignee under the Development Agreement should be addressed as follows: _____________________ _____________________ _____________________ _____________________ Attn: _____________________ DocuSign Envelope ID: E5073C16-5448-4149-87ED-FECA660F4B5F 087873\16998268v10 #166356 v4 9184.2 E-5 1786314.1 With a copy to: _____________________ _____________________ _____________________ Attn: _____________________ [REMAINDER OF PAGE LEFT INTENTIONALLY BLANK] DocuSign Envelope ID: E5073C16-5448-4149-87ED-FECA660F4B5F 087873\16998268v10 E-6 IN WITNESS WHEREOF, the parties hereto have executed this [Partial] Assignment as of the date set forth below its name below. “ASSIGNOR” _____________________, a _____________________ By: ___________________________________ Date: ___________________________________ By: ___________________________________ Date: ___________________________________ “ASSIGNEE” _____________________, a _____________________ By: ___________________________________ Date: ___________________________________ By: ___________________________________ Date: ___________________________________ DocuSign Envelope ID: E5073C16-5448-4149-87ED-FECA660F4B5F