Loading...
HomeMy Public PortalAboutOrdinance 925ORDINANCE 925 RESCINDED BY ORDINANCE 1140 ORDINANCE NO. 925 AN UNCODIFIED ORDINANCE OF THE CITY COUNCIL OF THE CITY OF BEAUMONT, CALIFORNIA, ADOPTING THE DEVELOPMENT AGREEMENT BETWEEN THE CITY OF BEAUMONT AND THE PRESERVE LLC, IN CONNECTION WITH THE LEGACY HIGHLANDS SPECIFIC PLAN (PURSUANT TO GOVERNMENT CODE SECTIONS 65864-65869.5) WHEREAS, in order to strengthen the public planning process, to encourage private participation in comprehensive planning, and the reduce the economic risks of development, the Legislature of the State of California has adopted Sections 65864 through 65869.5 of the Government Code which authorize the City of Beaumont (hereinafter referred to as "City") to enter into a Development Agreement; and WHEREAS, the Beaumont City Council certifies that Legacy Highlands Specific Plan Environmental Impact Report has been prepared for the Legacy Highlands Specific Plan, and the City Council finds that the findings made in connection with said Environmental Impact Report are applicable and adequately address the environmental implications associated with the subject actions. WHEREAS, the applicant, The Preserve LLC, proposed and submitted and City staff has reviewed and negotiated the terms of a development agreement to govern the development of the Legacy Highlands Specific Plan; and WHEREAS, duly noticed public hearings were conducted on this matter as required by law by the Planning Commission on November 13 and December 11, 2008,and the matter was forwarded to the City Council without a recommendation from the Planning Commission due to a lack of a quorum to act on the matter on December 11, 2008; WHEREAS, a duly noticed public hearing was conducted on this matter as required by law by the City Council on January 15, 2008 to consider an action to approve the proposed Development Agreement based upon the following findings: 1. The proposed agreement is consistent with the objectives, policies, general land uses and programs specified in the Beaumont General Plan; 2. The proposed agreement facilitates land uses which are compatible with the uses authorized in, and the regulations prescribed for, the land use districts in which the real property is located; ORDINANCE NO. 925 Page 2 3. The proposed agreement is in conformity with public convenience, general welfare and good land use planning practice; 4. The proposed agreement will not be detrimental to the health, safety and general welfare; 5. The proposed agreement will not adversely affect the orderly development of the property or the preservation of property values; 6. The proposed agreement will facilitate quality master planned development which will aid in the economic development of the City; and 7. The proposed agreement will not have an adverse impact on the environment. WHEREAS, the City Council of the City of Beaumont has reviewed the findings as related to the proposed development agreement as described above. THEREFORE, THE CITY COUNCIL OF THE CITY OF BEAUMONT DOES HEREBY ORDAIN AS FOLLOWS: SECTION 1: It has been determined that: A. The provisions of the Amendment to the Development Agreement between the City and Beaumont and The Preserve LLC are consistent with the General Plan; and B. The Development Agreement complies with all applicable zoning, subdivision and building regulations and with the Legacy Highlands Specific Plan; and C. The Development Agreement states the duration of the Agreement shall be a period of 25 years, sets forth the uses of the property, and the density and intensity of use, and sets forth the maximum height and size of proposed buildings and provides for the reservation, dedication and improvement of land uses for public facility uses. SECTION 2: The Development Agreement between the City and The Preserve LLC, attached hereto as Exhibit "A" is hereby approved and the Mayor of the City of Beaumont is authorized and directed to execute said Development Agreement on behalf of the City on or after the date when by law this Ordinance shall take effect. ORDINANCE NO. 925 PAGE 3 SECTION 3: This Ordinance shall take effect thirty (30) days after its final passage and within fifteen (15) days after its passage the City Clerk shall cause a summary to be published in a newspaper of general circulation, printed and published in the City of Beaumont, in a manner prescribed by law for publishing of ordinance of said City. MOVED AND PASSED upon first reading this 15th day of January, 2008 by the following roll call vote: AYES: Mayor Pro Tem Killough, Council Members Berg, and Dressel NOES: Mayor DeForge and Council Member Fox ABSTAIN: None ABSENT: None MOVED, PASSED AND ADOPTED this 5th day of February, 2008 by the following roll call vote: AYES: Mayor DeForge, Council Members Killough, Berg, Fox and Dressel. NOES: None ABSTAIN: None ABSENT: None r Mayor DeForg DEVELOPMENT AGREEMENT (LEGACY HIGLANDS PROJECT) THIS DEVELOPMENT AGREEMENT (LEGACY HIGLANDS PROJECT) (the "Agreement") is dated for reference purposes only as of the day of , 2007, by and between the CITY OF BEAUMONT, a municipal corporation, organized and existing under the laws of the State of California ("CITY") and THE PRESERVE LLC, a California limited liability company ("OWNER") pursuant to the authority of Sections 65864 through 65869.5 of the California Government Code (the "Development Agreement Legislation") and Article XI, Section 2, of the California Constitution. CITY and OWNER are sometimes hereinafter referred to as the "Parties." RECITALS This Agreement is predicated upon the following facts: A. These Recitals refer to and utilize certain capitalized terms which are defined in this Agreement. The Parties intend to refer to those definitions in conjunction with the use thereof in these Recitals. B. The Development Agreement Legislation authorizes CITY to enter into binding development agreements with persons having legal or equitable interests in real property for the development of such property in order to, among other things: ensure high quality development in accordance with comprehensive plans; provide certainty in the approval of development projects so as to avoid the waste of resources and the escalation in the cost of housing and other development to the consumer; provide assurance to the applicants for development projects that they may proceed with their projects in accordance with existing policies, rules, and regulations, subject to the applicable conditions of approval, in order to strengthen the public planning process and encourage private participation in comprehensive planning and reduce the private and public economic costs of development; and encourage and provide for the development of public infrastructure and amenities to support the development of new housing and commercial projects. C. OWNER is the fee owner of that certain real property consisting of approximately 1,600 acres of land area southerly of State Route 60 (SR -60), and westerly of State Route 79 (SR -79) in the County of Riverside, State of California, that is more particularly described in Exhibit "A" attached hereto and made a part hereof (the "Property"). Accordingly, OWNER has an equitable interest in the Property within the meaning of the Development Agreement Legislation. D. OWNER desires to develop the Property as a large scale master planned development commonly known as "Legacy Higlands" (the "Project") in accordance with the provisions of this Agreement, the "Development Plan" described herein, and other applicable regulations of the City of Beaumont and other governmental agencies having jurisdiction over the Property and the Project. E. OWNER has applied for, and CITY has approved, this Agreement in order to create a beneficial development project and a physical environment that will conform to and complement the goals of CITY, be sensitive to human needs and values, and facilitate efficient traffic circulation. By its approval and execution of this Agreement CITY has determined that CITY (including, without limitation the existing and future residents of CITY) will receive the following direct and indirect benefits from the implementation of this Agreement: 1. The Project will provide a unique semi -urban community with residential, commercial, senior, school, park and open space areas. It will provide a sensible transition between the rural and urban portions of the CITY. 2. The Project will conform to CITY's goal to manage growth through the use of, among other things, comprehensive planning and design, project -wide continuity of landscaping and architectural design, state-of-the-art development standards, and planning concepts. 3. OWNER will dedicate land for needed onsite transportation improvements, including without limitation the portions of the future Potrero Boulevard. The traffic and circulation elements of the Development Plan will conform to CITY's General Plan and will be designed to reduce the impact of the average daily trips generated by the Development of the Property on arterial roads and thoroughfares. 4. OWNER will construct and/or contribute to numerous on and off-site traffic improvements, as set forth in the draft EIR for the Legacy Highlands Specific Plan EIR, which is to be adopted and approved by the CITY concurrently with this Agreement. 5. The Project will result in the creation of approximately 704 acres of open space and will provide a potential school site for Beaumont Unified School District. 6. The Project concept provides for park and trail facilities in excess of those required. F. The following actions have been taken with respect to this Agreement and the Project: 1. OWNER has submitted complete applications to the CITY for 1) a Specific Plan covering the Property ("Legacy Highlands Specific Plan"), and 2) multiple vesting tentative tract maps subdividing the property ("Vesting Maps"). An environmental impact report ("Project EIR") has also been prepared for the Project. The Legacy Highlands Specific Plan, the Vesting Maps and the Project EIR are hereafter collectively referred to as the "Concurrent Approvals". 2. Concurrently with the public hearing on this Agreement, the CITY considered the Concurrent Approvals. 3. On , 200_, after a duly noticed and conducted public hearing, the City Council of CITY adopted its Resolution No. certifying the -2- Environmental Impact Report for CITY's Comprehensive General Plan Update, making certain findings and determinations with respect thereto, and approving said General Plan Update. The General Plan Land Use Element Map, as so updated, designates the Property to be developed with uses consistent with the terms and conditions set forth in this Agreement; 5. On , 200_, following a duly noticed and conducted public hearing, the Planning Commission of CITY recommended to the City Council that it approve this Agreement; 6. Pursuant to the applicable provisions of the California Environmental Quality Act, Public Resources Code Section 21000 et seq., and the regulations promulgated by the Secretary of Resources pursuant thereto (Title 14 of the California Code of Regulations, Section 15000 et seq.) (collectively, "CEQA"), by its approval of this Agreement the City Council of CITY has found and determined that all of the significant environmental impacts of the Project were adequately addressed in the Project EIR, that additional environmental review of the Project at this time would be duplicative and is not necessary or appropriate. 7. On , 2007, after a duly noticed and conducted public hearing, the City Council of CITY determined that the provisions of this Agreement are consistent with the General Plan of CITY; and 8. On , 2007, after a duly noticed and conducted public hearing, the City Council of CITY introduced Ordinance No. approving and authorizing the execution of this Agreement and on , 2007, the City Council adopted said Ordinance (hereinafter the "Authorizing Ordinance"), a copy of which Authorizing Ordinance is on file in the City Clerk's office at City Hall. 9. Concurrently with approval and authorization by the City Council of this Agreement, the City approved the Concurrent Approvals. G. In consideration of the substantial public improvements and benefits to be provided by OWNER and the Project, and in order to strengthen the public planning process and reduce the economic risk of development, by this Agreement CITY intends to provide to OWNER the assurance that it can proceed with Development of the Project for the Term of this Agreement pursuant to the terms and conditions of this Agreement and in accordance with the CITY's General Plan, ordinances, policies, rules, and regulations existing as of the Effective Date. In reliance on CITY's covenants in this Agreement concerning Development of the Property, OWNER has and will in the future incur substantial costs in site preparation and the construction and installation of major infrastructure and facilities in order to make the Development Plan feasible. H. Pursuant to Section 65867.5 of the Development Agreement Legislation, the City Council has found and determined that: (i) this Agreement and the Development Plan for the Project implement the goals and policies of CITY' s General Plan, provide balanced and diversified land uses and impose appropriate standards and requirements with respect to land -3- development and usage in order to maintain the overall quality of life and the environment within the City of Beaumont, (ii) this Agreement is in the best interests of and not detrimental to the public health, safety, and general welfare of CITY and its residents; (iii) adopting this Agreement is consistent with CITY's General Plan and constitutes a present exercise of CITY's police power; and (iv) this Agreement is being entered into pursuant to and in compliance with the requirements of Section 65867 of the Development Agreement Legislation. I. CITY and OWNER agree that it may be beneficial to enter into additional agreements or to modify this Agreement with respect to the implementation of the separate components of the Development Plan when more information concerning the details of each component is available, and that this Agreement should expressly allow for such contemplated additional agreements and modifications to this Agreement. AGREEMENT NOW, THEREFORE, pursuant to the authority contained in the Development Agreement Legislation, as it applies to CITY, pursuant to Article XI, Section 2 of the California Constitution, and in consideration of the foregoing recitals of fact, all of which are expressly incorporated into this Agreement, the mutual covenants set forth in this Agreement, and for the further consideration described in this Agreement, the Parties agree as follows: 1. Definitions. The following words and phrases are used as defined terms throughout this Agreement and each defined term shall have the meaning set forth below: 1.1 Authorizing Ordinance. "Authorizing Ordinance" means Ordinance No. approving this Agreement. 1.2 CEQA. "CEQA" has the meaning ascribed to that term in Recital F.6 of this Agreement. 1.3 CITY. "CITY" means the City of Beaumont, a California municipal corporation, duly organized and existing under the Constitution and laws of the State of California, and all of its officials, employees, agencies, and departments. 1.4 City Council. "City Council" means the duly elected and constituted city council of CITY. 1.5 Default. "Default" has the meaning ascribed in Section 9.1 or 9.2 of this Agreement, as applicable. 1.6 Develop or Development or Developing. "Develop" or "Development" or "Developing" means the improvement of the Property for purposes consistent with the Development Plan, including, without limitation: subdividing, grading, the construction of infrastructure and public facilities related to the Specific Plan Area Off -Site Transportation Improvements, the construction of structures and buildings, and the installation of landscaping, all in accordance with the provisions of this Agreement, but does not include the maintenance, -4- repair, reconstruction, or redevelopment of any building, structure, improvement, or facility after the initial construction and completion thereof. 1.7 Development Agreement Legislation. "Development Agreement Legislation" means Sections 65864 through 65869.5 of the California Government Code as it exists on the Effective Date. 1.8 Development Exactions. "Development Exactions" means any requirement of CITY for the dedication of land (including without limitation through the encumbrance of land with an easement or use restriction in favor of a public agency, the public, or a private non-profit entity), the construction or improvement of public improvements or facilities (including without limitation improvements or facilities located on land that is encumbered with an easement or use restriction in favor of a public agency, the public, or a private non-profit entity), or the formation of any Financing District and/or payment of any special taxes, assessments, or fees, of whatever amount and however denominated, in order to provide any such public improvements or facilities in conjunction with Development or to lessen, offset, mitigate, or compensate for the impacts of development on the environment or other public interests. 1.9 Development Plan. "Development Plan" means the plan for Developing the Project on the Property in accordance with this Agreement, the Development Plan Approval(s), and the Future Approvals. As of the Effective Date, the Development Plan consists of the provisions of CITY's General Plan (as amended through the Comprehensive General Plan Update referred to in Recital F.4) applicable to the Property, the narrative description of the Project set forth in Exhibit B to this Agreement, the express provisions set forth in this Agreement that define or describe the Project and the Concurrent Approvals. The Future Development Approvals automatically shall become a part of the Development Plan and included within the scope of OWNER's vested rights provided for in this Agreement without the need for any amendment of this Agreement when the same are issued or approved by CITY and become effective. Each of the documents memorializing the Development Plan is (or will be) maintained in the official records of CITY and shall be utilized whenever required to interpret or apply this Agreement. 1.10 Development Plan Approval(s). "Development Plan Approval(s)" means the approvals of the City Council described in Exhibit "C" hereto insofar as the same relate to the Property and the Development Plan, including those amendments to this Agreement made in accordance with Section 3.5 hereof, those amendments to the Development Plan Approvals made in accordance with Section 3.6 hereof, and those Future Development Approvals made in accordance with Section 3.7 hereof. 1.11 Development Transferee. "Development Transferee" means a person or entity that expressly assumes obligations under this Agreement pursuant to Section 2.5 hereof. 1.12 Effective Date. "Effective Date" means the date the Authorizing Ordinance becomes effective. 1.13 End User. "End User" means a buyer, assignee, or transferee of one or more individual or subdivided unit(s)/lot(s) of the Property obtaining such unit(s) or lot(s) for the -5- purpose of occupying or using such lots or units for its own purposes and not for use in the trade or business of further development, subdivision, or sale. The term "End User" includes, but is not limited to, any homeowner's association, merchants' association, or like entity formed with respect to any portion of the Property which owns some interest in the Property, homeowners, tenants, commercial building owners, and owners of multi -family residential units. 1.14 Financing District. "Financing District" means one or more assessment districts, community facility districts, or other similar public financing mechanisms formed to pay for any of the public improvements and facilities that are the responsibility of OWNER or the Project or any of the development impact fees payable by OWNER with respect thereto, including without limitation the TUMF Fee provided for in Section 4.1 and the Specific Plan Area Offsite Transportation Improvements. 1.15 Future Development Approvals. "Future Development Approvals" means those entitlements and approvals that are: (a) made in accordance with Section 3.7 hereof; and (b) requested by CITY or OWNER in order to authorize the Development to occur upon the Property in a manner consistent with the Development Plan Approval(s). By way of enumeration, and not limitation of the foregoing, the Future Development Approvals development permits, development plan reviews, tentative maps, final maps, use permits, variances, grading permits, building permits, and occupancy permits that are required as a condition to OWNER's right to Develop all or any portion of the Project. 1.16 On -Site Improvements. "On -Site Improvements" means physical infrastructure improvements or facilities that are or will be located on the Property. Certain On -Site Improvements may be specifically addressed in this Agreement. 1.17 Owner. "Owner" means The Preserve, LLC, a California limited liability company. 1.18 Party or Parties. "Party" means either CITY or OWNER, as the context dictates, and "Parties" means CITY and OWNER.. 1.19 Planning Commission. "Planning Commission" means the duly appointed and constituted planning commission of CITY. 1.20 Project. "Project" has the meaning ascribed in Recital D. The conceptual planning elements of the Project are more specifically described in Exhibit "B" hereto. 1.21 Property. "Property" means that certain real property referred to in Recital C and more particularly described in Exhibit "A" to this Agreement, as the same may be modified from time to time pursuant to Section 2.4 or Section 3.5.4. 1.22 Specific Plan Area. "Specific Plan Area" means the property referred to in Recital E.7 and depicted in Exhibit "D" to this Agreement. 1.23 Specific Plan Area Offsite Transportation Improvements. "Specific Plan Area Offsite Transportation Improvements" means, collectively, those off-site traffic and transportation improvements set forth in the Project EIR. -6- 1.24 Term. "Term" means the period of time that this Agreement remains in effect with respect to the Property or any portion thereof, as provided in Section 2.3. 1.25 Transportation Fees. "Transportation Fees" means the fees to be paid by OWNER in conjunction with its Development of the Project as provided for in Section 4.1 of this Agreement. It is understood that the Transportation Fees may be paid in cash at the time building permits are issued, through the proceeds of a Financing District, or a combination of the two. 1.26 TUMF Fees. "TUMF Fees" mean the Transportation Uniform Mitigation Fees that generally are required to be paid in conjunction with new development in the City pursuant to Ordinance No. 839 adopted by the City Council of CITY, as amended by Ordinance No. 875, and as the same may be further amended from time to time. 1.27 TUMF Program. "TUMF Program" means the Western Riverside County Transportation Uniform Mitigation Fee Program for the financing and construction/installation of various regional transportation improvements in which CITY is a participant, including all ordinances, resolutions, regulations, policies, and administrative plans and guidelines relating thereto, as the same now exist or may hereafter be amended. 2. General Provisions. 2.1 Binding Covenants. The provisions of this Agreement to the extent permitted by law shall constitute covenants which shall run with the Property for the benefit thereof, and the benefits and burdens of this Agreement shall bind and inure to the benefit of the Parties and all successors in interest to the Parties hereto. 2.2 Interest of OWNER. As of the date this Agreement is being executed by the Parties, OWNER represent that it is the owner in fee of the Property which constitutes an equitable interest in the Property. 2.3 Term. Subject to the provisions of Section 10.4 of this Agreement, the initial term (hereinafter called "Term") of this Agreement shall commence on the Effective Date and shall extend for a period of twenty (20) years thereafter, terminating at the end of, the day immediately preceding the twentieth (20th) anniversary of the Effective Date, subject to the termination provisions set forth herein; provided, however, that so long as OWNER is not in Default of this Agreement and the Agreement has not been otherwise terminated, OWNER may, without the prior written consent of CITY, extend the Term for one (1) additional period of fifteen (15) years; and provided further that with respect to such 15 -year extension option, OWNER shall give CITY written notice of its intent to extend the Term not more than one hundred eighty (180) days and not less than sixty (60) days before the end of the initial Term. 2.4 Termination. This Agreement shall be deemed terminated and of no further effect upon the occurrence of any of the following events: or (i) If termination occurs pursuant to any specific provision of this Agreement; -7- (ii) As to any separate legal lot(s) or parcel(s) within the Property, upon the completion of Development on and with respect to said lot(s) or parcel(s) pursuant to the terms of this Agreement and CITY's issuance of all required occupancy permits or final inspections, as applicable, and acceptance of all dedications and improvements required to complete such Development; or (iii) Entry after all appeals have been exhausted of a final judgment or issuance of a final order directed to CITY invalidating this Agreement; or The termination of this Agreement in its entirety or with respect to a particular lot(s) or parcel(s) shall not affect any right or duty of OWNER arising from a source other than this Agreement. In the event this Agreement terminates in its entirety or with respect to a particular lot(s) or parcel(s), and notwithstanding any other provision set forth herein, upon request by OWNER, any End User, or any other successor or assignee of either of them, CITY shall cooperate, at no cost to CITY, in executing in recordable form a document prepared by the requesting party that confirms the termination of this Agreement with respect to the Property or applicable portion thereof. 2.5 Transfers and Assignments. 2.5.1 Right to Assign to Development Transferee. OWNER shall have the right from time to time at any time during the Term of this Agreement and on such number of occasions as it chooses to sell, lease, encumber, assign, or otherwise transfer all or any portion of its interests in the Property together with all its right, title, and interest in this Agreement, or the portion thereof which is subject to transfer (the "Transferred Property"), to any Development Transferee, all without any requirement or obligation to obtain CITY's approval or consent. In the event of any such sale, assignment, or other transfer, (i) OWNER shall notify CITY within thirty (30) days of such event of the name of the Development Transferee and (ii) the agreement between OWNER and such Development Transferee pertaining to such transfer shall provide that the Development Transferee shall be liable for the performance of those obligations of OWNER set forth in this Agreement which relate to the Transferred Property and which have not been performed or completed prior to the date of the transfer, if any. Each Development Transferee and OWNER shall notify CITY in writing which entity shall be liable for the performance of any obligations set forth or arising out of this Agreement that relate to the construction or installation of public infrastructure improvements located off of the portion of the Property so transferred. Upon any sale, assignment, or other transfer under this Section 2.5.1, CITY shall in writing release OWNER from all obligations, if any, of OWNER under this Agreement which relate to the Transferred Property (excepting only any obligations with respect to infrastructure improvements that are retained by the assignor/transferor, as provided in the preceding sentence, and in addition CITY shall acknowledge and agree in writing that its sole recourse for any refusal or failure by the Development Transferee to perform the obligations so transferred or assigned to it shall be solely against such Development Transferee. Notwithstanding the foregoing, to the extent CITY reasonably determines that the transferor/assignor's Development of the portion of the Property retained by it is dependent upon the performance of obligations assumed by a Development Transferee, which obligations have -8- not been performed, CITY may, in its reasonable discretion, withhold any approvals, including, without limitation, certificates of occupancy, from the transferor/assignor until such obligations have been performed. 2.5.2 Right to Assign to End User. OWNER shall have the right, without the consent of CITY, from time to time and on such number of occasions as it chooses, to sell, assign, or otherwise transfer any or all individual lots on final maps approved on the Property or any portion thereof, to any End User at any time during the Term of this Agreement. 2.5.3 Rights of Successors and Assigns. During the Term of this Agreement, any and all successors and assigns of OWNER shall have all of the same rights, benefits, and obligations of OWNER under this Agreement. 3. Development Provisions. 3.1 Vesting. 3.1.1 Project. CITY covenants that OWNER has, and OWNER shall have, the right to develop the Project on the Property consistent with the Development Plan and the Development Plan Approvals, including, without limitation, the Future Development Approvals after the same have been issued or approved by CITY and become effective ("Vested Right"). 3.1.2 Limits on Development. The California Supreme Court held in Pardee Construction Company v. City of Camarillo, 37 Ca1.3d 465 (1984), that the failure of the parties to address certain limits on a city's ability to condition, restrict, or regulate a development allowed a later adopted initiative to restrict the development. This Agreement is intended to cure that deficiency by expressly addressing the timing for the Development, the Vested Rights afforded by this Agreement, and the scope of CITY's reserved authority described in Section 3.2 hereof. Except as expressly set forth in the Development Plan and Development Plan Approval(s), regardless of any future enactment, whether by initiative or otherwise, OWNER shall have the vested right to Develop the various components of the Project in such order, at such rate, in one phase or in multiple phases, and at such times as OWNER deems appropriate within the exercise of its subjective business judgment. Specifically, CITY agrees that OWNER shall be entitled to apply for and receive the Future Development Approvals and to Develop and use the Property at any time, provided that such application is made and such Development occurs in accordance with this Agreement and the other Development Plan Approval(s). No future amendment of any CITY law and no future adoption of any CITY law or other action that purports to limit the scope, rate, or timing of Development on the Property or to alter the sequencing of the Development in a manner inconsistent with the Development Plan or the Development Plan Approval(s) (including without limitation the Future Development Approvals when issued by CITY), whether the same are adopted or imposed by the City Council or through the initiative or referendum process, shall apply to the Property. In particular, but without limiting any of the foregoing, no numerical restriction shall be placed by CITY on the number of dwellings units or amount of commercial development that may be built in any particular year on any portion of the Property. Notwithstanding the foregoing, nothing in this Section 3.1 shall limit or restrict CITY' s reserved authority as described in Section 3.2. -9- 3.1.3 Development Impact Fees. Notwithstanding anything to the contrary, all development impact fees collected for the Project, regardless of when imposed or collected, shall be limited to those only fees in existence as of the Effective Date and such fees shall be fixed at the amount or rate in effect as of the Effective Date. CITY shall not require the Project or the Property to participate in regional programs (i.e., programs that are not initiated by CITY and that include properties located in whole or in part outside the City of Beaumont) nor shall CITY require the Project or the Property to pay or contribute to regional Development Exactions to the extent that such programs or Development Exactions are not in effect as of the Effective Date, including without limitation any such programs or Development Exactions initiated by the County of Riverside or the Western Riverside Council of Governments. 3.1.4 Entitlements, Permits, and Approvals - Cooperation. 3.1.3.1 Processing. CITY agrees that it shall accept and expeditiously process, pursuant to CITY's regular procedures, OWNER's complete applications for the Future Development Approvals and, if applicable, OWNER's complete applications for amendments to this Agreement, to the Development Plan Approval(s), and to any of the Future Development Approvals (after the same have been initially approved). 3.1.3.2 Existing Land Use Regulations. Except as otherwise provided under the terms of this Agreement, the rules, regulations and official policies governing permitted uses of the Property, the density and intensity of use of the Property, the maximum height and size of proposed buildings, and the design, improvement and construction standards and specifications applicable to Development of the Property, shall be as set forth in the CITY code which was in full force and effect as of the Effective Date of this Agreement. 3.1.3.2 Other Permits. CITY further agrees to reasonably cooperate with OWNER, at no cost to CITY, in securing any County, State, and Federal permits or authorizations which may be required in connection with Development of the Property that are consistent with the Development Plan and Development Plan Approval(s); provided, that nothing in this Section 3.1.3.2 shall be deemed to require CITY's assumption of any obligations under any said permits or authorizations. 3.1.3.3 Acquisition of Off -Site Property. CITY shall not postpone or refuse approval of any Future Development Approval because OWNER or a Development Transferee has failed to acquire off-site property required for the construction or installation of offsite improvements, including without limitation any of the Specific Plan Area Offsite Transportation Improvements. To the extent CITY, OWNER, or a Development Transferee does not have sufficient title or interest to permit any of such offsite improvements that are OWNER's responsibility to be constructed or installed at the time the application for a Future Development Approval is processed or approved by CITY (and subject to the limitations on OWNER's obligations with respect to offsite transportation improvements as set forth in Sections 4.1-4.3 and 4.5 hereof), OWNER or the Development Transferee shall make a good faith effort to acquire the required property. If OWNER or the Development Transferee is unable to acquire the required property, CITY shall consider in good faith the acquisition of the required -10- property. If CITY is unable to acquire the required property by negotiation or condemnation within the time frame provided for in Government Code Section 66462.5, CITY shall continue to issue the Future Development Approval(s) for the Property despite the fact that the offsite improvement has not been completed. Notwithstanding the foregoing, CITY's obligation to continue to issue the Future Development Approvals as provided for in this Section is contingent upon: (i) OWNER or the Development Transferee submitting the improvement plans required for the improvement to CITY; and (ii) consistent with Government Code Section 66462.5, OWNER or the Development Transferee entering into a mutually acceptable agreement with CITY that requires OWNER or the Development Transferee to pay or reimburse or secure the future payment or reimbursement of CITY for OWNER's fair share of the costs incurred in acquiring the land and constructing the applicable offsite improvement(s) at such time as CITY acquires the required land (again, subject to the limitations on OWNER's obligations with respect to offsite transportation improvements as set forth in Sections 4.1-4.3 and 4.5 hereof). 3.2 Reserved Authority. 3.2.1 Reservation of Authority With Respect to Future Development Approvals; Future Changes in Development Exactions. Notwithstanding any other provision set forth in this Agreement to the contrary, CITY reserves the right after the Effective Date of this Agreement to apply only the following subsequent land use regulations: (i) Processing fees and charges of every kind and nature imposed by City to cover the estimated actual costs to City of processing applications for Future Development Approvals or for monitoring compliance with any Future Development Approvals granted or issued.; (ii) Procedural regulations consistent with this Agreement relating to hearing bodies, petitions, applications, notices, findings, records, hearings, reports, recommendations, appeals and any other matter of procedure; and (iii) Regulations that may be in conflict with the Development Plan, any Development Approval, or this Agreement, if City determines that the failure of the City to enforce any such regulation would place the residents of the Project or the residents of the City, or both, in a condition dangerous to their health or safety, or both. 3.2.2 Uniform Codes. This Agreement shall not prevent CITY from applying to the Project new uniform construction standards adopted by the State of California as State Codes, such as the Uniform Building Code, National Electrical Code, Uniform Mechanical Code, and Uniform Fire Code, provided those same standards are applied to all other development within the City of Beaumont. 3.2.3 State and Federal Laws and Regulations. OWNER shall comply with all applicable state and federal laws and regulations, provided that nothing in this Agreement shall be deemed to limit or restrict OWNER's right to contest or challenge the validity of any such -11- laws or regulations or their applicability to the Property or the Project. In the event that either CITY or OWNER determines that a state or federal law or regulation prevents the full implementation of the Development Plan and/or any of the Development Plan Approvals, that Party shall provide the other Party with written notice of the state or federal law or regulation, a copy of the law or regulation, and a written statement of the conflicts between such state or federal law or regulation and this Agreement. Promptly thereafter CITY and OWNER shall meet and confer in good faith in a reasonable attempt to determine whether a modification or suspension of this Agreement is required, provided that each Party reserves its discretion with respect thereto. CITY agrees to cooperate with OWNER in resolving the conflict in a manner which minimizes any adverse fiscal or other impact of the conflict upon OWNER, provided only that in no event does CITY agree that in such event it will materially increase its financial obligations set forth in this Agreement or otherwise materially increase its obligations. CITY also agrees to process in a prompt manner OWNER's proposed changes to the Development Plan and/or Development Plan Approvals as may be necessary to comply with such federal or state law or regulation; provided, however, that the approval of such changes by CITY shall be subject to the discretion of CITY, consistent with this Agreement. 3.2.4 Suspension of Development in Order to Protect Health and Safety. Nothing in this Agreement shall be construed to be in derogation of CITY's police power to suspend OWNER's right to develop the Project in order to protect the public health and safety (e.g., in the event of the unavailability of adequate water, wastewater treatment, or storm drainage facilities). In the event that CITY determines that the public health or safety require a suspension of OWNER's right to develop the Project, the term of the suspension shall be limited to the period of time during which the public health or safety concern continues, and CITY shall exercise reasonable good faith efforts to minimize the period of such suspension to the extent that the cause thereof is within CITY's control. As soon as is reasonably practicable after the commencement of an event that results in a suspension of OWNER's rights hereunder due to public health or safety concerns, CITY shall provide OWNER with written notice of the existence of such event, a detailed explanation of CITY's proposed action, and a written statement of any conflicts with the provisions of this Agreement that require a suspension of any of the terms hereof. Promptly thereafter CITY and OWNER 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. In such negotiations, CITY and OWNER agree to preserve the terms of this Agreement and the rights of OWNER as derived from this Agreement to the maximum feasible extent while resolving the conflict. CITY agrees to cooperate with OWNER in a good faith reasonable effort to resolve any such conflict in a manner which minimizes any adverse financial or other impact of the conflict upon OWNER without materially increasing the obligations of CITY under this Agreement. CITY also agrees in such event to process in an expedited manner OWNER's proposed changes to the Development Plan and any previously issued Development Plan Approvals as may be necessary to appropriately respond to the public health and safety concern; provided, however, that the approval of any such changes by CITY shall be subject to the discretion of CITY, consistent with this Agreement. 3.3 Further Assurances to OWNER Regarding Exercise of Reserved Authority. The Parties further acknowledge that the public benefits to be provided by OWNER to CITY pursuant to this Agreement are in consideration for and reliance upon assurances that the Property may be developed in accordance with the Development Plan and the Development Plan -12- Approval(s). Accordingly, while recognizing that the Development of the Property may be affected by the exercise of the authority and rights reserved and excepted as provided in Sections 3.1 ("Vesting") and 3.2 ("Reserved Authority"), OWNER is concerned that normally the judiciary extends to local agencies significant deference in the adoption of rules, regulations, and policies and that in the absence of an express provision set forth in this Agreement such judicial deference might be construed to permit CITY, in violation of the limitations on its reserved authority, to attempt to apply rules, regulations, and policies that are inconsistent with the Development Plan and the Development Plan Approval(s). Accordingly, OWNER desires assurances that CITY shall not, and CITY agrees that it shall not, further restrict or limit the Development of the Property in violation of this Agreement except in strict accordance with the reserved authority described in Section 3.2 hereof, which exercising of CITY's reserved authority shall not be considered to be a violation of this Agreement. In this regard, from and after the date that CITY approves the Specific Plan for the Project, as contemplated by Section 4.4.1 of this Agreement, if OWNER judicially (including by way of a reference proceeding) challenges CITY's purported exercise of its reserved authority as being in violation of this Agreement, OWNER shall bear the burden of alleging that such purported exercise by CITY of its Reserved Authority is inconsistent with the Development Plan or the Development Plan Approval(s) and CITY thereafter shall bear the burden of proof in establishing by a preponderance of the evidence that such exercise of its reserved authority is in accordance with and not a violation of this Agreement. 3.4 Vested Right. By entering into this Agreement and relying thereupon, OWNER is obtaining certain vested rights to proceed with the Development anticipated by the Development Plan and the Development Approvals and in accordance with the terms and conditions of this Agreement (as the same may be amended and supplemented from time to time as expressly set forth herein). By entering into this Agreement and relying thereupon, CITY is securing certain public benefits which enhance the public health, safety, and welfare. CITY therefore agrees to the following: 3.4.1 No Conflicting Enactments. Except as provided in Section 3.2 of this Agreement, after the Effective Date neither the City Council nor any other agency of CITY shall enact a rule, regulation, ordinance, or other measure (collectively, "law") applicable to the Property which is inconsistent or in conflict with this Agreement. Not by way of limitation of the foregoing, any law, whether by specific reference to this Agreement or otherwise, shall be considered to be inconsistent and in conflict with this Agreement if it has any of the following effects: (i) It limits or reduces the density or intensity of the Project as provided for in the Development Plan or the Development Plan Approval(s); (ii) It applies to the Property, but is not uniformly applied by CITY to all substantially similar development within CITY; or (iii) It imposes Development Exactions on the Property other than those in effect on the Effective Date. -13- 3.4.2 Consistent Enactments. By way of enumeration and not limitation, the following types of laws shall be considered consistent and not in conflict with this Agreement: (i) Laws that provide for the relocation of structures within the Property pursuant to an application from OWNER; (ii) Laws that provide for changes in the phasing of the Development pursuant to an application from OWNER; and (iii) Any law that is expressly authorized by this Agreement. 3.4.3 Moratoria. No City -imposed moratorium or other limitation (whether relating to the rate, timing or sequencing of the development or construction of all or any part of the Property, whether imposed by ordinance, initiative, resolution, policy, order or otherwise, and whether enacted by the City Council, an agency of City, the electorate, or otherwise) affecting parcel or subdivision maps (whether tentative, vesting tentative or final), building permits, occupancy certificates or other entitlements to use or service (including, without limitation, water and sewer) approved, issued or granted within City, or portions of City, shall apply to the Property. 3.5 Amendment of Development Agreement. 3.5.1 Initiation of Amendment. Either Party may propose an amendment to this Agreement, and both Parties agree that it may be beneficial to enter into additional agreements or modifications of this Agreement in connection with the Development of the separate components of the Development Plan. Notwithstanding any provision of this Agreement to the contrary, no amendment to the Development Plan or to any conditions of approval contained therein shall require an amendment of this Agreement. 3.5.2 Procedure. Except as set forth in Section 3.5.4 below, the procedure for proposing and adopting an amendment to this Agreement shall be the same as the procedure required for entering into this Agreement in the first instance. 3.5.3 Consent. Except as expressly provided in this Agreement, any amendment to this Agreement shall require the written consent of both Parties. No amendment to all or any provision of this Agreement shall be effective unless set forth in writing and signed by duly authorized representatives of each of the Parties. 3.5.4 Operating Memoranda. The Parties acknowledge that refinements and further development of the Development Plan may demonstrate that changes are appropriate with respect to the details and performance of the Parties under this Agreement. The Parties desire to retain a certain degree of flexibility with respect to the details of the Development Plan and with respect to those items covered in general terms under this Agreement. If and when the Parties mutually find that changes, adjustments, or clarifications are appropriate to further the intended purposes of this Agreement, they may, unless otherwise required by law, effectuate such changes, adjustments, or clarifications without amendment to this Agreement through operating -14- memoranda mutually approved by the Parties, which, after execution, shall be attached hereto as addenda and become a part hereof and which may be further changed and amended from time. To the maximum extent permitted by law, the City Manager shall have the authority, on behalf of CITY, to approve and execute such operating memoranda and the Managing Member or other corporate officer designated for such purpose in a writing signed by the Managing Member of OWNER shall have the authority, on behalf of OWNER, to approve and enter into such operating memoranda. Unless otherwise required by law or by the Development Plan Approvals, no such changes, adjustments, or clarifications shall require prior notice or hearing. 3.6 Future Amendments to Development Plan. The following rules apply to future amendments to the Development Plan: 3.6.1 OWNER's Written Consent. Any Development Plan amendment to which OWNER does not agree in writing shall not apply to the Property while this Agreement is in effect. 3.6.2 Concurrent Development Agreement Amendment. Any Development Plan amendment requiring amendment of this Agreement shall be processed concurrently with an amendment to this Agreement. 3.6.3 Effect of Amendment. Except as expressly set forth in the Development Plan amendment itself or this Agreement, a Development Plan amendment shall not alter, affect, impair, or otherwise impact the rights, duties, and obligations of the Parties set forth in this Agreement. 3.7 Future Development Approvals. 3.7.1 Exercise of CITY Discretion. In connection with Future Development Approvals or any other actions which CITY is expressly permitted to take consistent with this Agreement relating to the Property, to the maximum extent permitted by law CITY shall exercise its discretion or take action in a manner which complies and is consistent with the Development Plan, any Development Plan Approval(s) issued by CITY consistent with this Agreement prior to the date CITY takes final action on the Future Development Approval then in question, and the other terms and conditions set forth herein. 3.7.2 Concurrent Development Agreement Amendment. Any Future Development Approval requiring amendment of this Agreement, as provided for in Section 3.5 hereof, shall be processed concurrently with an amendment to this Agreement. 3.7.3 Effect of Future Development Approvals. To the maximum extent permitted by law and except as expressly set forth in this Section 3.7, a Future Development Approval shall not alter, affect, impair, or otherwise affect the rights, duties, and obligations of the Parties set forth in this Agreement. To the extent a Future Development Approval is approved in accordance with Sections 3.7.1 and 3.7.2, the Future Development Approval shall constitute for all purposes a Development Plan Approval. -15- 4. Milieellanerfas Oblls_ations of the Parties. 4.1.. C��'s and ON/AR'S'Obligations With Respect to Speeifi Plan Area Offsite Tran ci{a� veru 'OWNER acknowledges and agrees that the Specific Plan Area Offsite T.provements are needed for the build -out of the Project on the Property and of St p i within the Specific, Plan Area, that CITY has no identified source of funds to • p+ fcir. af' improv + °� othsir than the owners/developers of land within the Specific Pr y, t titkAVNER and the other owners/developers of la .within• the S , be required to pay or contribute its fair shamof the costs for said .herein, the term "fair share" as applied to OWNER and the. Project shall share percentage of the total cost of planning, designing, engineering, bi + `+ ! $ sr I , constructing/i fling, supervising, and inspecting said improvements. As - t y. _ term . WNER'Ps fair share percentage" shall mean OWNER'S and the Proms' p +age of: the total equivalent dwelling units ("EDU'st) approved for e Specific Plaut. Area as,a whole, assuming the nimum build -out of each p: ' . i� Speciftetlain'A ba calculated in accordance with the standar(3 vehicle trip gen _ • _ R , E + ' 3, gy tisef.Y by CIT`., taking into consideration any redu *ions in trip utable to trap, ation demand mana ement' . and joint use �� g �s etopment(s) without regard t©' actual or projected trip distribution of P the Specif 'fan Area on particuffr Specific Plan Area Offsite Trta�tnents: CITY and.OWNER shall cooperate and consult with one another ttotal estimated cost of the Specific Plan, Area Offsite Transportation e relative.tu share contributions to such cost tobe paid or contributed by within ''tlie Specific Plan Area, including OWNER and the Property; prtided, that (I) -in the event CITY and OWNER disagree about any such matters C aeapabie determination with respect to same shall be final and. conclusive; and (ii) both C \1k OWNER acknowledge, that said estimated cost and fair share percentages may be ie before the Specific Plan Area Offsite Transportation Improvements The cost. of right -of way acquisition needed for any of the Specific Plan Area Offsite moments shall not be considered as part of the estimated total cost thereof or fining the fair share contribution amount of any owner/developer Transiao for- (incIu#ng ONEl hereunder), it'itbin the . Specific Plan Area; CITY shall require each owner/dive k to offer for cation.(without compensation) all right-of-way required for the portions o Specific; Plan Area' Offsite Transportation Improvements within such owner/devel'oper's Iand: Iri the event that for any reason any other owner/developer within the Specififf-Plan. Area fails or refuses to melee such an' offer of dedication prior' 'to the time that OWNER,Meds the, applicable improvergent(s) to be constructed/installed,' CITY and OWNER shall tinie3y perft,tiri all of their respective obligations set forth in Section 3.1.3.3 and CITY covenants to tcimburse OWNER (or cause said other owner/developer to reimburse OWNER) for all costs incurred by OWNER tb seciire said right-of-way, plus interest at the rate of seven percent 1% pc annum, frond the date funds are advanced by OWNER until principal and accrued intetestatt'paid in full), no,later than ten (10) days after the date CITY issues the first discretionary development approval to said other owner/developer. -16- on set 'forth in this A,reetnent to thetnrry, in n �velopment Exactio for local or re i'on� off the P op otherythan set forth above is Sect shall 'pro tit, prevent, or delay Development `o anspirtation lrnprov4 erapotion Tmp n 4.2 Entitlements. 4.2.1 Specific Plan. As noted above, the Legacy Highlands Specific Plan was concurrently reviewed with this Agreement by the CITY and has been approved by the CITY. 4.2.2 Tentative Map Extension. Pursuant to the provisions of Section 66452.6(a) of the Government Code, the Vesting Maps approved concurrently with this Agreement and any other tentative subdivision map or tentative parcel map heretofore or hereafter approved in connection with development of the Property shall remain in full force and effect for the greater of (i) the Term of this Agreement or (ii) the maximum term for such map permitted under Section 66452.6 of the Government Code. CITY agrees that any extension of a map authorized by this Agreement shall occur automatically upon the date any such map would otherwise expire and that OWNER shall not be required to submit an application or any other request to CITY for any such extension to occur or to be valid and enforceable. 4.2.3 Other Land Use Entitlements and Development Approvals. To the maximum extent permitted, any other land use and Development approvals, including without limitation, conditional use permits, variances, and building permits shall be tied to the life of the Vesting Maps and shall survive so long as the Vesting Maps remain valid. As with the Vesting Maps, such extension shall occur automatically upon the date any such approval or entitlement would otherwise expire and that OWNER shall not be required to submit an application or any other request to CITY for any such extension to occur or to be valid and enforceable. 4.2.4 Vesting Tentative Maps. If any tentative or final subdivision or parcel map heretofore or hereafter approved in connection with Development of the Property is a vesting map under the Subdivision Map Act (Government Code Section 66410 et seq.) and if this Agreement is determined by a final judgment to be invalid or unenforceable insofar as it grants a vested right to develop to OWNER, then and to that extent the rights and protections afforded OWNER under the laws and ordinances applicable to vesting maps shall supersede the provisions of this Agreement to the maximum extent permitted by law. Except as set forth immediately above, Development of the Property shall occur as provided in this Agreement, and the provisions of this Agreement shall be controlling over any conflicting provision of law or ordinance concerning vesting maps. 4.2.5 Lot Line Adjustments. Adjustments to lot lines required for purposes beneficial to the Project, including, without limitation, refinement and enhancement of the specific plan and grant deeds, shall be processed on an "administrative approval" basis only. -17- 4.2.6 Multiple Final Maps. CITY agrees that, pursuant to the provisions of Section 66463.1 of the Government Code, OWNER may file concurrently or consecutively one or more final maps relating to the Property and the Vesting Maps. 4.3 Financing Districts. At OWNER's request, CITY shall reasonably consider and cooperate with OWNER in forming one or more public financing districts, including without limitation assessment districts, community facilities districts, and/or Section 308 districts (herein, collectively, "Financing Districts"), for the purpose of financing, among other things, the construction/installation and/or maintenance and operation of the Specific Plan Area Off -Site Transportation Improvements, On -Site Improvements that are to be publicly owned that may be OWNER's responsibility, and other public infrastructure facilities and/or development impact fees required as part of the Development Plan. As part of this cooperation, CITY shall reasonably consider entering into one or more joint community facilities agreements or other agreements pursuant to which CITY will authorize the financing of CITY public infrastructure facilities and/or development impact fees, if applicable, through the issuance of bonds by such community facilities districts or through the use of real property tax increment. 4.4 Future Development Approvals. To the maximum extent permitted by law CITY agrees to expedite the processing of OWNER's Specific Plan application referred to in Section 4.4.1 and any other Future Development Approvals, and to use its reasonable good faith efforts to approve or adopt the Future Development Approvals in form and content reasonably satisfactory to OWNER; provided, however, that nothing in this Section 4.6 shall, or shall be construed to, constitute a promise or commitment by CITY to approve the Future Development Approvals or to approve the same with or without any particular requirements or conditions, and provided further that prior to the date that the Future Development Approvals may be so approved, CITY reserves its full legislative police power authority with respect thereto consistent with its obligations set forth elsewhere in this Agreement. To the extent a Future Development Approval is approved that pertains to the Property, the Future Development Approval shall constitute for all purposes a Development Plan Approval.. 5. Indemnification. Except to the extent of the gross negligence or willful misconduct of CITY and its agents, officers, contractors, attorneys, and employees (the "Indemnified Parties"), OWNER, and with respect to the portion of the Property transferred to them, the Development Transferee agree: to indemnify, defend, and hold harmless the Indemnified Parties from and against each and every claim, action, proceeding, cost, fee, legal cost, damage, award or liability of any nature arising from alleged damages caused to third parties and alleging that CITY is liable therefor as a direct or indirect result of CITY's approval of or performance under this Agreement. OWNER's duties under this Section 5 are solely subject to and conditioned upon the Indemnified Parties' written request to OWNER to defend and/or indemnify CITY. Without in any way limiting the provisions of this Section 5, the Parties hereto agree that this Section 5 shall be interpreted in accordance with the provisions of California Civil Code Section 2778 in effect as of the Effective Date. -18- 6. Relationship of Parties. The contractual relationship between CITY and OWNER is such that OWNER is an independent contractor and not the agent or employee of CITY. CITY and OWNER hereby renounce the existence of any form of joint venture or partnership between them, and agree that nothing contained in this Agreement or in any document executed in connection with the Property shall be construed as making CITY and OWNER joint venturers or partners. 7. Amendment or Cancellation of Agreement. This Agreement may be amended or canceled in whole or in part only by mutual consent of the Parties in the manner provided for in Government Code Section 65868. No amendment or modification of this Agreement or any provision hereof shall be effective unless set forth in writing and signed by duly authorized representatives of each Party hereto. This provision shall not limit CITY's or OWNER's remedies as provided by Section 9. 8. Periodic Review of Compliance with Agreement. 8.1 Periodic Review. CITY and OWNER shall review this Agreement at least once every 12 -month period from the date this Agreement is executed. CITY shall notify OWNER in writing of the date for review at least thirty (30) days prior thereto. Such periodic review shall be conducted in accordance with Government Code Section 65865.1. 8.2 Good Faith Compliance. During each periodic review, OWNER shall be required to demonstrate good faith compliance with the terms of this Agreement. OWNER agrees to furnish such reasonable evidence of good faith compliance as CITY, in the exercise of its reasonable discretion, may require. If requested by OWNER, CITY agrees to provide to OWNER a certificate that OWNER or a Development Transferee is in compliance with the terms of this Agreement, provided OWNER reimburses CITY for all reasonable and direct costs and fees incurred by CITY with respect thereto. 8.3 Failure to Conduct Annual Review. The failure of CITY to conduct the annual review shall not be a OWNER Default, nor shall any such failure alter, suspend, or terminate any of the Parties' other rights and obligations hereunder. Further, OWNER shall not be entitled to any remedy for a failure by CITY to conduct this annual review. 8.4 Initiation of Review by City Council. In addition to the annual review, the City Council may at any time initiate a review of this Agreement by giving written notice to OWNER. Within thirty (30) days following receipt of such notice, OWNER shall submit evidence to the City Council of OWNER's good faith compliance with this Agreement and such review and determination shall proceed in the same manner as is provided in Sections 8.1 and 8.2 and the Development Agreement Legislation for the annual review. The City Council shall initiate its review pursuant to this Section 8.4 only if it has probable cause to believe CITY's general health, safety, or welfare is at risk as a result of specific acts or failures to act by OWNER. 8.5 Administration of Agreement. Any final decision by the CITY's staff concerning the interpretation and administration of this Agreement and Development of the Property in -19- accordance herewith may be appealed by OWNER to the City Council, provided that any such appeal shall be filed with the City Clerk within ten (10) days after OWNER receives written notice that the staff decision is final. The City Council shall render, at a noticed public hearing, its decision to affirm, reverse, or modify the staff decision within thirty (30) days after the appeal is so filed. 8.6 Availability of Documents. If requested by OWNER, CITY agrees to provide to OWNER copies of any documents, reports, or other items reviewed, accumulated, or prepared by or for CITY in connection with any periodic compliance review by CITY, provided OWNER reimburses CITY for all reasonable and direct costs and fees incurred by CITY with respect thereto. CITY shall respond to OWNER's request on or before ten (10) business days have elapsed from CITY's receipt of such request. 9. Events of Default: Remedies and Termination. 9.1 Defaults by OWNER. If CITY determines on the basis of a preponderance of the evidence that OWNER has not complied in good faith with the terms and conditions of this Agreement, CITY may, by written notice to OWNER, specify the manner in which OWNER has failed to so comply and state the steps OWNER must take to bring itself into compliance. If, within sixty (60) days after the effective date of notice from CITY specifying the manner in which OWNER has failed to so comply, OWNER does not commence all steps reasonably necessary to bring itself into compliance as required and thereafter diligently pursue such steps to completion, then OWNER shall be deemed to be in default under the terms of this Agreement (a "Default"). In such event, and subject to the provisions of Section 9.6, CITY may terminate this Agreement pursuant to Government Code Section 65865.1. In event of Default by OWNER, except as provided in Section 9.3, CITY's sole remedy for any breach of this Agreement by OWNER shall be CITY's right to terminate this Agreement. 9.2 Defaults by CITY. If OWNER determines on the basis of a preponderance of the evidence that CITY has not complied in good faith with the terms and conditions of this Agreement, OWNER may, by written notice to CITY, specify the manner in which CITY has failed to so comply and state the steps CITY must take to bring itself into compliance. If, within sixty (60) days after the effective date of notice from OWNER specifying the manner in which CITY has failed to so comply, CITY does not commence all steps reasonably necessary to bring itself into compliance as required and thereafter diligently pursue such steps to completion, then CITY shall be deemed to be in default under the terms of this Agreement (a "Default"). In such event, and subject to the provisions of Section 9.6, OWNER may terminate this Agreement and, in addition, may pursue any other remedy available at law or equity, including specific performance as set forth in Section 9.3. 9.3 Specific Performance Remedy. Due to the size, nature, and scope of the Development Plan, it will not be practical or possible to restore the Property to its natural condition once implementation of this Agreement has begun. After such implementation, OWNER may be foreclosed from other choices it may have had to utilize the Property and provide for other benefits. OWNER has invested significant time and resources and performed extensive planning and processing of the Development Plan and Development Plan Approvals in agreeing to the terms of this Agreement and will be investing even more significant time and -20- resources in implementing the Development Plan and Development Plan Approvals in reliance upon the terms of this Agreement, and it is not possible to determine the sum of money which would adequately compensate OWNER for such efforts. For the above reasons, CITY and OWNER agree that damages would not be an adequate remedy if CITY fails to carry out its obligations under this Agreement and that OWNER shall have the right to seek and obtain injunctive relief and specific performance as a remedy for any Default by CITY hereunder. CITY and OWNER further acknowledge that, subject to Section 9.6 of this Agreement, if OWNER fails to carry out its obligations under this Agreement, CITY shall have the right to refuse to issue any permits or other approvals which OWNER otherwise would have been entitled to pursuant to this Agreement that are related to and depend upon OWNER's performance hereunder. Therefore, CITY's remedy of terminating this Agreement shall be sufficient in most circumstances if OWNER fails to carry out its obligations hereunder. Notwithstanding the foregoing, if CITY issues a permit or other approval pursuant to this Agreement in reliance (explicitly stated in writing) upon a specified condition being satisfied by OWNER in the future, and if OWNER then fails to satisfy such condition, CITY shall be entitled to specific performance for the sole purpose of causing OWNER to satisfy such condition. CITY's right to specific performance shall be limited to those circumstances set forth above, and CITY shall have no right to seek specific performance to cause OWNER to otherwise proceed with the Development of the Property in any manner. 9.4 Institution of Legal Action. Except to the extent a non -Defaulting Party's rights or remedies are limited by the express provisions set forth herein, OWNER or CITY may institute legal action to cure, correct, or remedy any Default, to enforce any covenants or agreements herein, to enjoin any threatened or attempted violation hereof, to recover damages for any Default, or to obtain any other remedies consistent with the purpose of this Agreement. Such legal action shall be heard by a reference from the Riverside County Superior Court. 9.5 Estoppel Certificates. Either Party or the holder or prospective holder of a mortgage or deed of trust secured by an interest in any portion of the Property (a "holder") may at any time during the Term of this Agreement deliver written notice to the other Party requesting an estoppel certificate (the "Estoppel Certificate") stating: (i) The Agreement is in full force and effect and is a binding obligation of the Parties; (ii) This Agreement has not been amended or modified either orally or in writing or, if so amended, identifying the amendments; (iii) No Default exists hereunder, nor would any Default exist with the passage of time or the giving of notice, or both, or, if a Default or failure does exist, the nature thereof and the actions required to be taken by the non-performing Party to cure the Default or prevent the same from occurring; and (iv) Any other matter affecting the status of the rights and obligations of the Parties hereunder as to which the requesting Party or the holder may inquire. -21- A Party receiving a request for an Estoppel Certificate shall provide a signed certificate to the requesting Party or holder within thirty (30) days after receipt of the request. The City Manager or any person designated by the City Manager may sign Estoppel Certificates on behalf of CITY. Any officer of OWNER may sign on behalf of OWNER. An Estoppel Certificate may be relied on by the holder and by Development Transferees. In the event that one Party requests an Estoppel Certificate from the other, the requesting Party shall reimburse the other Party for all reasonable and direct costs and fees incurred by such Party with respect thereto. 9.6 No Cross -Defaults and No Joint and Several Liability. Notwithstanding any other provision set forth in this Agreement to the contrary, in no event shall a Default by OWNER (including without limitation any Development Transferee of the original OWNER hereunder) with respect to one or more separate legal parcels within the Property be deemed to constitute a Default hereunder relating to any other legal parcel or parcels within the Property, and in such event CITY's rights and remedies (including without limitation its equitable remedies and its remedy of rescission or termination, if applicable) shall be limited to the parcel(s) as to which the uncured Default exists. Consistent with the foregoing, in the event that the legal parcels comprising the Property are owned by multiple persons or entities comprising OWNER, no one OWNER shall be jointly and severally liable for the acts and omissions of another person or entity comprising OWNER and CITY shall look to each separate OWNER for performance of the obligations that pertain to it. 10. Waivers and Delays. 10.1 No Waiver. 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 hereto, shall not constitute a waiver of such Party's right to demand strict compliance by such other Party in the future for the same, similar, or any different Default. 10.2 Third Parties. The Parties' respective performance obligations hereunder shall not be delayed or excused because of any act or failure to act by a third person, except as provided in Section 10.3. 10.3 Force Majeure. Notwithstanding any other provision set forth in this Agreement to the contrary, OWNER shall not be deemed to be in Default where failure or delay in performance of any of its obligations under this Agreement is caused by floods, earthquakes, other Acts of God, fires, wars, riots or similar hostilities, strikes and other labor difficulties beyond OWNER's control, OWNER's inability to obtain required permits or approvals from governmental agencies with jurisdiction over the Property and the Project, government regulations (including, without limitation, local, state, and federal environmental and natural resource regulations), voter initiative or referenda, moratoria (including, without limitation, any "development moratorium" as that tern is applied in Government Code Section 66452.6), litigation, or any other causes that are without the fault and beyond the reasonable control of OWNER. -22- 10.4 Extensions. The Term of this Agreement and the time for performance by OWNER or CITY of any of its obligations hereunder or pursuant to the Development Plan Approvals shall be extended by the period of time that any of the events described in Section 10.3 exist and/or prevent performance of such obligations. In addition, the Term shall be extended for delays arising from the following events for a time equal to the duration of each delay which occurs during the Term: (i) The period of time after the Effective Date during which litigation challenging the validity or enforceability of this Agreement or related to the Development Plan Approvals or having the actual effect of delaying implementation of the Development Plan is pending, including litigation pending on the Effective Date. This period shall include any time during which appeals may be filed or are pending; and (ii) Any delay resulting from the acts or omissions of CITY or any other governmental agency or public utility and beyond the reasonable control of OWNER. 10.5 Notice of Delay. OWNER shall give notice to CITY of any delay which OWNER believes to have occurred as a result of the occurrence of any of the events described in Section 10.3. For delays of six months or longer, this notice shall be given within a reasonable time after OWNER becomes aware that the delay has lasted six months or more. In no event, however, shall notice of a delay of any length be given later than thirty days after the end of the delay or thirty days before the end of the Term, whichever comes first. 11. Notices. All notices required or provided for under this Agreement shall be in writing and delivered in person or sent by certified mail, postage prepaid, return receipt requested. Notices required to be given to CITY shall be addressed as follows: City of Beaumont 550 East 6th Street Beaumont, CA 92223 Attention: City Manager with a copy to: Notices required to be given to OWNER shall be addressed as follows: The Preserve, LLC c/o David Golkar 8891 Research Drive Irvine, CA 92618 -23- with a copy to: Law Office of Aamir Raza c/o Aamir Raza 655 N. Central Ave., 17th Floor Glendale, CA 91203 Any notice given as required herein shall be deemed given only if in writing and upon delivery personally, by United States Mail or by independent courier service. A Party may change its address for notices by giving notice in writing to the other Party as required herein and thereafter notices shall be addressed and transmitted to the new address. CITY shall additionally provide written notice of any Default by OWNER (including, as applicable, any Development Transferee) and any act or omission by OWNER (or such Development Transferee) that would constitute a Default with the passage of time or giving of notice or both, to the holder of any mortgage or deed of trust secured by all or any interest in the Property which (i) delivers a written notice to CITY requesting such notices and (ii) provides CITY with such holder's address(es) for notice purposes. 12. Attorneys' Fees. If legal action is brought by either Party against the other for breach of this Agreement, including actions derivative from the performance of this Agreement, or to compel performance under this Agreement, the prevailing Party shall be entitled to an award of its costs, including reasonable attorneys' fees, and shall also be entitled to recover its contribution to the costs of the referee referred to in Section 9.4 above as an item of damage and/or recoverable costs. 13. Recording. This Agreement and any amendment or cancellation hereto shall be recorded, at no cost to CITY, in the Official Records of Riverside County by the City Clerk within the period required by Section 65868.5 of the Government Code. Notwithstanding the foregoing, in no event shall any failure or delay in recording this Agreement and any amendment to this Agreement limit or restrict the validity or enforceability of this Agreement. 14. Effect of Agreement on Title. 14.1 Effect on Title. OWNER and CITY agree that this Agreement shall not continue as an encumbrance against any portion of the Property as to which this Agreement has terminated. 14.2 Encumbrances and Lenders' Rights. OWNER and CITY hereby agree that this Agreement shall not prevent or limit OWNER (including without limitation any Development Transferee of the original Developer hereunder), at any time or from time to time in any manner, at its or their sole discretion, from encumbering the Property, the improvements thereon, or any portion thereof with any mortgage, deed of trust, sale and leaseback arrangement, or other security device. CITY acknowledges that the holder of any such security interest in all or any portion of the Property may require certain clarifications, interpretations, or modifications to this -24- Agreement or the Development Plan and CITY agrees, upon request, from time to time, to meet with OWNER and/or representatives of any such holder to negotiate in good faith any such request for clarification, interpretation, or modification. CITY further agrees that it will not unreasonably withhold its consent to any such requested clarification or interpretation to the extent such clarification or interpretation is consistent with the intent and purpose of this Agreement. A Default under this Agreement shall not defeat, render invalid, diminish, or impair the lien of any such holder. The mortgagee of a mortgage or beneficiary of a deed of trust or holder of any other security interest in the Property or any portion thereof and its or their successors and assigns, including without limitation the purchaser at a judicial or non judicial foreclosure sale or a person or entity which obtains title by deed -in -lieu of foreclosure (collectively, a "holder") shall be entitled to receive a copy of any notice of Default (as defined in Section 10.1 hereof) delivered to OWNER and, as a pre -condition to the institution of legal proceedings or termination proceedings, CITY shall deliver to all such holders written notification of any Default by OWNER in the performance of its obligations under this Agreement which is not cured within sixty (60) days (the "Second Default Notice") and shall allow the holder(s) an opportunity to cure such Defaults as set forth herein. The Second Notice of Default shall specify in detail the alleged Default and the suggested means to cure it. After receipt of the Second Default Notice, each such holder shall have the right, at its sole option, within ninety (90) days to cure such Default or, if such Default cannot reasonably be cured within that ninety (90) day period, to commence to cure such Default, in which case no Default shall exist and CITY shall take no further action. Notwithstanding the foregoing, if such Default shall be a Default which can only be remedied by such holder obtaining possession of the Property, or any portion thereof, and such holder seeks to obtain possession, such holder shall have until ninety (90) days after the date obtaining such possession to cure or, if such Default cannot reasonably be cured within such period, then to commence to cure such Default. Further, a holder shall not be required to cure any non -curable Default of OWNER, and any such Default shall be deemed cured if any lender obtains possession. 15. Severability of Terms. If any term, provision, covenant, or condition of this Agreement shall be determined invalid, void, or unenforceable, the remainder of this Agreement shall not be affected thereby if the tribunal finds that the invalidity was not a material part of consideration for either Party. The covenants contained herein are mutual covenants. The covenants contained herein constitute conditions to the concurrent or subsequent performance by the Party benefited thereby of the covenants to be performed hereunder by such benefited Party. 16. Subsequent Amendment to Authorizing Statute. This Agreement has been entered into in reliance upon the provisions of the Development Agreement Legislation in effect as of the Effective Date. Accordingly, to the extent that subsequent amendments to the Development Agreement Legislation would affect the provisions of this Agreement, such amendments shall not be applicable to this Agreement unless necessary for this Agreement to be enforceable or required by law or unless this Agreement is modified -25- pursuant to the provisions set forth in this Agreement and Government Code Section 65868 as in effect on the Effective Date. 17. Rules of Construction and Miscellaneous Terms. 17.1 Interpretation and Governing Law. The language in all parts of this Agreement shall, in all cases, be construed as a whole and in accordance with its fair meaning. This Agreement and any dispute arising hereunder shall be governed and interpreted in accordance with the internal laws of the State of California, with regard to conflict of laws rules. The Parties understand and agree that this Agreement is not intended to constitute, nor shall be construed to constitute, an impermissible attempt to contract away the legislative and governmental functions of CITY, and in particular, CITY's police powers. In this regard, the Parties understand and agree that this Agreement is a current exercise of CITY's police powers and except as expressly provided for herein this Agreement shall not be deemed to prevent the future exercise by CITY of its lawful governmental powers over the Property. 17.2 Section Headings. All section headings and subheadings are inserted for convenience only and shall not affect any construction or interpretation of this Agreement. 17.3 Gender. The singular includes the plural; the masculine gender includes the feminine; "shall" is mandatory, "may" is permissive. 17.4 Time of Essence. Time is of the essence regarding each provision of this Agreement as to which time is an element. 17.5 Recitals. All Recitals set forth herein are incorporated in this Agreement as though fully set forth herein. 17.6 Entire Agreement. This Agreement constitutes the entire agreement between the Parties with respect to the subject matter hereof, and this Agreement supersedes all previous negotiations, discussions, and agreements between the Parties with respect thereto. 18. Not for Benefit of Third Parties. This Agreement and all provisions hereof are for the exclusive benefit of CITY and OWNER and its Development Transferees and shall not be construed to benefit or be enforceable by any third party, excepting only to the extent of the limited rights provided to the holders of security interests in all or a portion of the Property. 19. Cooperation in Event of Legal Challenge. CITY agrees to cooperate with OWNER as may be needed in order to keep this Agreement in full force and effect during the entire Term. In the event of any legal action instituted by a third party or other governmental entity or official challenging the validity or enforceability of any provision of this Agreement or any of the Development Plan Approval(s) (including without limitation any Future Development Approvals after the same have been issued by CITY), the Parties hereby agree to cooperate in defending such action and, in this regard, CITY shall not allow its default to be taken in such legal action or otherwise compromise -26- the legal action without OWNER's prior written consent. In the event of any such litigation, to the maximum extent permitted by law this Agreement shall remain in full force and effect while such litigation, including any appellate review, is pending. Notwithstanding the foregoing, OWNER shall be responsible for all costs, including but not limited to attorney's fees, costs, expert witness fees, and the like, incurred with respect to any such litigation. [Remainder of Page Intentionally Left Blank] -27- IN WITNESS WHEREOF, the Parties hereto have executed this Agreement on the day and year dated below. Dated: ATTEST: , 2007 "CITY" CITY OF BEAUMONT, a municipal corporation By: City Clerk APPROVED AS TO FORM: City Attorney Dated: Name: Title: Mayor , 2007 "OWNER" THE PRESERVE, LLC, a California limited liability company By: Name: David Golkar Title: Managing Member [Remainder of Page Intentionally Left Blank Notarizations on following page] -28- STATE OF CALIFORNIA COUNTY OF ) ) ) ss: On , 2007 before me, , personally appeared , personally known to me (or 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. WITNESS my hand and official seal. STATE OF CALIFORNIA COUNTY OF ) ) ) ss: Notary Public On , 2007 before me, , personally appeared , personally known to me (or 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. WITNESS my hand and official seal. Notary Public EXHIBIT "A" LEGAL DESCRIPTION OF THE PROPERTY Order Number: NHRV-2687043 (tc) Page Number: 29 LEGAL DESCRIPTION Real property in the City of Riverside , County of Riverside, State of California, described as follows: PARCEL 1: (APN 421-070-004 AND 421-070-005, 421-070-007) LOTS 6, 7 AND 8 IN SECTION 8, TOWNSHIP 3 SOUTH, RANGE 1 WEST, SAN BERNARDINO BASE AND MERIDIAN; EXCEPTING FROM LOTS 7 AND 8 THAT PORTION DESCRIBED AS FOLLOWS: BEGINNING AT THE NORTHEAST CORNER OF SAID LOT 8; THENCE WESTERLY ON THE NORTH LINE OF SAID GOVERNMENT LOT 8, 400 FEET; THENCE SOUTHERLY AT RIGHT ANGLES TO SAID NORTHERLY UNE 900 FEET; THENCE EASTERLY PARALLEL WITH THE NORTHERLY UNE OF SAID LOTS 7 AND 8, 1000 FEET TO A POINT IN SAID LOT 7; THENCE NORTHERLY AT RIGHT ANGLES 900 FEET TO A POINT ON THE NORTH UNE OF SAID LOT 7; THENCE WESTERLY ON SAID NORTH UNE 600 FEET TO THE POINT OF BEGINNING, DESCRIBED IN THE DEED RECORDED JANUARY 22, 1963 AS INSTRUMENT NO. 7083 OF OFFICIAL RECORDS OF RIVERSIDE COUNTY, CALIFORNIA; ALSO EXCEPTING FROM LOT 7 A RESERVATION OF 1/20 SHARE IN ALL OIL AND MINERAL RIGHTS AND DEPOSITS AS RESERVED IN DEED TO ED C. MARTIN AND BIRDIE F. MARTIN FROM JAMES E. THOMPSON, A WIDOWER, RECORDED JUNE 15, 1946 IN BOOK 756 PAGE 217 OF OFFICIAL RECORDS OF RIVERSIDE COUNTY, CALIFORNIA. PARCEL 2: (APN 421-080-002) SECTION 17, TOWNSHIP 3 SOUTH, RANGE 1 WEST, SAN BERNARDINO BASE AND MERIDIAN, AS SHOWN BY UNITED STATES GOVERNMENT SURVEY: EXCEPTING THEREFROM THAT PORTION OF THE NORTHEAST 1/4 OF SAID SECTION, PARTICULARLY DESCRIBED AS FOLLOWS: BEGINNING AT A POINT FROM WHICH THE NORTHEAST CORNER OF SAID SECTION BEARS NORTH 14 DEGREES 58' EAST, 1073.0 FEET; THENCE SOUTH 88 DEGREES 42' WEST, 660 FEET; THENCE SOUTH 01 DEGREES 18' EAST, 660 FEET; THENCE NORTH 88 DEGREES 42' EAST, 660 FEET; THENCE NORTH 01 DEGREES 18' WEST, 660 FEET TO THE POINT OF BEGINNING. PARCEL 3: (421-190-002) THE NORTH 1/2 OF THE NORTHWEST 1/4 AND SOUTHWEST 1/4 OF NORTHWEST 1/4 OF SECTION 20, TOWNSHIP 3 SOUTH, RANGE 1 WEST, SAN BERNARDINO BASE AND MERIDIAN, AS SHOWN BY UNITED STATES GOVERNMENT SURVEY; EXCEPTING THEREFROM ALL THE OIL AND GAS TOGETHER WITH THE RIGHT TO PROSPECT FOR, MINE AND REMOVE SUCH DEPOSITS FROM SAME UPON COMPLIANCE WITH THE CONDITIONS AND SUBJECT TO THE PROVISIONS AND LIMITATIONS OF ACT OF JULY 17, 1914, AS RESERVED IN THE PATENT FROM THE UNITED STATES OF AMERICA, RECORDED MARCH 15, 1949 IN BOOK 1059 PAGE 170 OF OFFICIAL RECORDS OF RIVERSIDE COUNTY, CALIFORNIA. Order Number: NHRV-2687043 (tc) Page Number: 30 PARCEL 4: (APN 421-190-003) THE NORTH 1/2 OF THE NORTHEAST 1/4 AND THE SOUTHWEST 1/4 OF THE NORTHEAST 1/4 AND THE SOUTHEAST 1/4 OF THE NORTHWEST 1/4 OF SECTION 20, TOWNSHIP 3 SOUTH, RANGE 1 WEST, SAN BERNARDINO BASE AND MERIDIAN. PARCEL 5: (APN 421-190-006) THE WEST HALF OF THE NORTHEAST QUARTER OF THE SOUTHWEST QUARTER OF SECTION 20, TOWNSHIP 3 SOUTH, RANGE 1 WEST, SAN BERNARDINO BASE AND MERIDIAN, ACCORDING TO THE OFFICIAL PLAT THEREOF. PARCEL 6: (APN 421-190-004; 421-190-005 AND 421-190-011) THE SOUTHEAST QUARTER OF THE NORTHEAST QUARTER OF SECTION 20; THE NORTH HALF OF THE SOUTHEAST QUARTER OF SECTION 20; THE SOUTHEAST QUARTER OF THE SOUTHEAST QUARTER OF SECTION 20; EAST HALF OF THE NORTHEAST QUARTER OF THE SOUTHWEST QUARTER OF SECTION 20; ALL IN TOWNSHIP 3 SOUTH, RANGE 1 WEST, SAN BERNARDINO BASE AND MERIDIAN, ACCORDING TO THE OFFICIAL PLAT THEREOF; EXCEPTING THEREFROM THAT PORTION OF THE SOUTHEAST QUARTER OF SECTION 20 AS CONVEYED TO THE SOUTHERN CALIFORNIA EDISON COMPANY BY DEED RECORDED JUNE 12, 1970 AS INSTRUMENT NO. 55231 OF OFFICIAL RECORDS OF RIVERSIDE COUNTY, CALIFORNIA. PARCEL 6A: AN EASEMENT AND RIGHT OF WAY TO CONSTRUCT, USE, MAINTAIN AND REPAIR ONE ROAD, 20 FEET WIDE, EXTENDING IN A GENERALLY NORTHWESTERLY AND SOUTHEASTERLY DIRECTION IN, ON, OVER AND ACROSS THAT PORTION OF THE SOUTHEAST QUARTER OF SECTION 20, TOWNSHIP 3 SOUTH, RANGE 1 WEST, SAN BERNARDINO BASE AND MERIDIAN, ACCORDING TO THE OFFICIAL PLAT THEREOF AS DESCRIBED IN THE DEED TO THE SOUTHERN CALIFORNIA EDISON COMPANY AND UPON THE TERMS AND CONDITIONS SET FORTH IN SAID DEED RECORDED JUNE 12, 1970 AS INSTRUMENT NO. 55231 OF OFFICIAL RECORDS OF RIVERSIDE COUNTY, CALIFORNIA. PARCEL 7: (APN 421-070-006) THAT PORTION OF GOVERNMENT LOTS 7 AND 8 OF FRACTIONAL SECTION 8 TOWNSHIP 3 SOUTH RANGE 1 WEST, SAN BERNARDINO BASE AND MERIDIAN, ACCORDING TO AN ADDITIONAL PLAT OF SAID LAND AS FOLLOWS: BEGINNING AT THE NORTHEAST CORNER OF SAID LOT 8; THENCE WESTERLY 400 FEET ON THE NORTHERLY UNE OF SAID GOVERNMENT LOT 8; THENCE SOUTHERLY 900 FEET AT RIGHT ANGLES TO SAID NORTHERLY UNE; THENCE EASTERLY 1000 FEET PARALLEL WITH THE NORTHERLY UNE OF SAID LOTS TO A POINT IN SAID LOT 7; THENCE NORTHERLY 900 FEET AT RIGHT ANGLES TO A POINT OF THE NORTHERLY UNE OF SAID LOT 7; THENCE WESTERLY 600 FEET ON SAID NORTHERLY UNE TO THE POINT OF BEGINNING; ALSO EXCEPTING FROM LOT 7 A RESERVATION OF 1/20 SHARE IN ALL OIL AND MINERAL RIGHTS AND DEPOSITS AS RESERVED IN DEED TO ED C. MARTIN AND BIRDIE F. MARTIN FROM JAMES E. THOMPSON, A WIDOWER, RECORDED JUNE 15, 1946 IN BOOK 756 PAGE 217 OF OFFICIAL RECORDS Order Number: NHRV-2687043 (tc) Page Number: 31 OF RIVERSIDE COUNTY, CALIFORNIA. PARCEL 8: (APN 421-070-001) LOTS 1 AND 2 IN SECTION 8, TOWNSHIP 3 SOUTH, RANGE 1 WEST, SAN BERNARDINO BASE AND MERIDIAN, IN THE COUNTY OF RIVERSIDE, STATE OF CALIFORNIA; EXCEPT THE PORTION INCLUDED IN PUBLIC HIGHWAY ON THE NORTH. PARCEL 8A: AN EASEMENT FOR INGRESS AND EGRESS OVER AND ACROSS THE NORTHERLY 40 FEET OF GOVERNMENT LOT 3, SECTION 8, TOWNSHIP 3 SOUTH, SAN BERNARDINO BASE AND MERIDIAN, AS RESERVED IN DOCUMENT RECORDED OCTOBER 23, 1970 AS INSTRUMENT NO. 106752 OF OFFICIAL RECORDS OF RIVERSIDE COUNTY, CALIFORNIA. PARCEL 9: (APN 421-060-003 AND 421-060-004) THE NORTHWEST QUARTER OF SECTION 8, TOWNSHIP 3 SOUTH, RANGE 1 WEST, SAN BERNARDINO BASE AND MERIDIAN; EXCEPTING THEREFROM THOSE PORTIONS THEREOF CONVEYED TO THE COUNTY OF RIVERSIDE BY DEED RECORDED OCTOBER 29, 1915 IN BOOK 433 PAGE 7 OF DEEDS, RECORDS OF RIVERSIDE COUNTY, CALIFORNIA; ALSO EXCEPTING THEREFROM THOSE PORTIONS CONVEYED TO THE STATE OF CAUFORNIA BY DEEDS RECORDED MAY 20, 1936 IN BOOK 274 PAGE 577, OCTOBER 11, 1957 IN BOOK 2161 PAGE 442, AND AUGUST 19, 1959 AS INSTRUMENT NO. 72258, ALL OF OFFICIAL RECORDS OF RIVERSIDE COUNT', CALIFORNIA. PARCEL 9A: AN EASEMENT IN GROSS FOR INGRESS AND EGRESS, UTILITIES AND ROAD PURPOSES OVER THE NORTHERLY 80 FEET OF LOTS 1 AND 2 IN SECTION 8, TOWNSHIP 3 SOUTH, RANGE 1 WEST, SAN BERNARDINO BASE AND MERIDIAN, IN THE COUNTY OF RIVERSIDE, STATE OF CALIFORNIA; EXCEPT THE PORTION INCLUDED IN PUBLIC HIGHWAY ON THE NORTH, AS SET FORTH IN THAT CERTAIN DEED RECORDED AUGUST 19, 1988 AS INSTRUMENT NO. 88-236100 OF OFFICIAL RECORDS OF RIVERSIDE COUNTY, CALIFORNIA. PARCEL 10: (APN 421-100-002) GOVERNMENT LOT 2 IN FRACTIONAL SECTION 16, TOWNSHIP 3 SOUTH, RANGE 1 WEST, SAN BERNARDINO BASE AND MERIDIAN, ACCORDING TO GOVERNMENT SURVEY. PARCEL 11: (APN 421-100-005) GOVERNMENT LOT 3 IN FRACTIONAL SECTION 16, TOWNSHIP 3 SOUTH, RANGE 1 WEST, SAN BERNARDINO BASE AND MERIDIAN. PARCEL 12: (APN 421-100-010) THE NORTH HALF OF GOVERNMENT LOT 6 IN FRACTIONAL SECTION 16, TOWNSHIP 3 SOUTH, RANGE 1 WEST, SAN BERNARDINO BASE AND MERIDIAN. Order Number: NHRV-2687043 (tc) Page Number: 32 PARCEL 12A: A NON-EXCLUSIVE EASEMENT FOR INGRESS, EGRESS AND ROAD PURPOSES OVER AND ACROSS THE FOLLOWING DESCRIBED PROPERTY: THE NORTHERLY 30 FEET AND THE EASTERLY 30 FEET OF GOVERNMENT LOT 6; THE WESTERLY 30 FEET OF GOVERNMENT LOT 5; AND THE SOUTHERLY 60 FEET OF GOVERNMENT LOT 5, LYING WESTERLY OF THE WESTERLY LINE OF LAMB CANYON ROAD ALL IN FRACTIONAL SECTION 16, TOWNSHIP 3 SOUTH, RANGE 1 WEST, SAN BERNARDINO BASE AND MERIDIAN; EXCEPTING THAT PORTION IN THE NORTH HALF OF GOVERNMENT LOT 6. APN: 421-060-003 and 421-060-004 and 421-070-001 and 421-070-004 and 421-070-005 and 421-070- 006 and 421-070-007 and 421-080-002 and 421-100-002 and 421-100-005 and 421-100-010 and 421- 190-002 and 421-190-002 and 421-190-004 and 421-190-003 and 421-190-005 and 421-190-011 and 421-190-001 421-060-003 421-060-004 8 421-070-001 APN WILLOW SPRINGS N. T. S. 421-070-006 421-070-004 421-070-007 421-070-005 421-080-002 17 16 421-100-002 421-190-002 421-190-003 20 0 rn 421-190-005 421-190-004 421-100-005 421-100-010 z a I— T WW. 0 N T 1:19:04 pm EST 0 N 0 z 0 u) c0 H x i N 0 Z 0 0 J -J (0 vi EXHIBIT "B" DESCRIPTION OF THE PROJECT EXHIBIT "C" DEVELOPMENT PLAN APPROVALS 1. Legacy Highlands Specific Plan 2 Legacy Highlands Specific Plan EIR 3. [inert 1 approved t cone Trent he 4. Future Development Approvals (as and when, and in the form and substance, adopted by CITY). 112/019747-0017 605449.05 a09/06/07 EXHIBIT "D" SPECIFIC PLAN AREA [to be inserted] TABLE OF CONTENTS Page 1. Definitions 4 1.1 Authorizing Ordinance 4 1.2 CEQA. 4 1.3 CITY 4 1.4 City Council 4 1.5 Default 4 1.6 Develop or Development or Developing 4 1.7 Developer Error! Bookmark not defined. 1.8 Development Agreement Legislation 5 1.9 Development Exactions 5 1.10 Development Plan 5 1.11 Development Plan Approval(s) 5 1.12 Development Transferee 5 1.13 Effective Date 5 1.14 End User 5 1.15 Existing Owners. Error! Bookmark not defined. 1.16 Financing District 6 1.17 Future Development Approvals 6 1.18 On -Site Improvements 6 1.19 Party or Parties 6 1.20 Planning Commission 6 1.21 Potrero Boulevard TUMF Project Error! Bookmark not defined. 1.22 Project 6 1.23 Property 6 1.24 Specific Plan Area 6 1.25 Specific Plan Area Offsite Transportation Improvements 6 1.26 SR-60/Potrero Interchange Error! Bookmark not defined. 1.27 Term. 7 1.28 Transportation Fees 7 1.29 TUMF Fees. 7 1.30 TUMF Facilities Error! Bookmark not defined. 1.31 TUMF Program 7 2. General Provisions. 7 2.1 Binding Covenants 7 2.2 Interest of OWNER and OWNER 7 2.3 Term 7 2.4 Termination 7 2.5 Transfers and Assignments. 8 3. Development Provisions. 9 3.1 Vesting. 9 3.2 Reserved Authority. 11 112/019747-0017 605449.05 a09/06107 -1- Page 3.3 Further Assurances to OWNER Regarding Exercise of Reserved Authority. 12 3.4 Vested Right 13 3.5 Amendment of Development Agreement. 14 3.6 Future Amendments to Development Plan 15 3.7 Future Development Approvals. 15 4. Miscellaneous Obligations of the Parties 16 4.1 Developer Payment of Transportation Fee Error! Bookmark not defined. 4.2 CITY's and OWNER's Obligations With Respect to TUMF Facilities.Error! Bookmark not 4.3 CITY's and OWNER's Obligations With Respect to Specific Plan Area Offsite Transportation Improvements. 16 4.4 Entitlements. 17 4.5 Financing Districts 18 4.6 Future Development Approvals 18 4.7 Dedication of Land Required for Future SR-60/Potrero Interchange 18 5. Indemnification. 18 6. Relationship of Parties. 19 7. Amendment or Cancellation of Agreement. 19 8. Periodic Review of Compliance with Agreement. 19 8.1 Periodic Review 19 8.2 Good Faith Compliance 19 8.3 Failure to Conduct Annual Review 19 8.4 Initiation of Review by City Council 19 8.5 Administration of Agreement 19 8.6 Availability of Documents 20 9. Events of Default: Remedies and Termination. 20 9.1 Defaults by OWNER 20 9.2 Defaults by CITY 20 9.3 Specific Performance Remedy 20 9.4 Institution of Legal Action 21 9.5 Estoppel Certificates 21 9.6 No Cross -Defaults and No Joint and Several Liability 22 10. Waivers and Delays. 22 10.1 No Waiver 22 10.2 Third Parties 22 10.3 Force Majeure 22 10.4 Extensions 23 10.5 Notice of Delay 23 11. Notices. 23 112/019747-0017 605449.05 a09/06/07 -11- Page 12. Attorneys' Fees. 24 13. Recording. 24 14. Effect of Agreement on Title. 24 14.1 Effect on Title 24 14.2 Encumbrances and Lenders' Rights 24 15. Severability of Terms 25 16. Subsequent Amendment to Authorizing Statute 25 17. Rules of Construction and Miscellaneous Terms. 26 17.1 Interpretation and Governing Law 26 17.2 Section Headings 26 17.3 Gender 26 17.4 Time of Essence 26 17.5 Recitals 26 17.6 Entire Agreement 26 18. Not for Benefit of Third Parties. 26 19. Cooperation in Event of Legal Challenge 26 112/019747-0017 605449.05 a09/06/07 -111-