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HomeMy WebLinkAboutREDEVELOPMENT AGENCY 1993 Coultrup Development Company & Birtcher Real Estate (Copies-Destroy after approval of Coastal Commission) - 1993-01-01 Dec. 20 , 1992 RECEIVED CITY CLERK CITY OF HUNTINDTOh BEACH,CALIF. City Council Developmeg �ben�S!8 �t� � z 1 41'4-l9� City of Huntington Beach ; Ladies and Gentlemen, 15-en f-li- PL- ti We submitted a petition on Sept. 21 , 1992 and we strongly hold to those views due to the fragile state of our economic conditions. History has proven that the strongest societies are only as strong as their weakest link.. We, as Americans, went to Vietnam, Korea, Europe, the Gulf and now Somalia to help and protect the weak. Orange County .and H.B. both lack lew inccme rousing for those at the bottom of the pay scale. Restuarants and retail stores alike in this development area only pay minimum wage. We believe if a man or a woman likes or chooses or is forced to work in these fields of endeavor, he should not be denied affordable housing. We believe that H.B. downtown-. should be a place-for all to be able to live, work, and play, not just the rich. We are very confident that the city of H.B. believes in the U.S. Constitution and the rights for all, not just a few. Business has tremendously declined at E1 Don Liquor and Michaels Surfboards due to lack of parking. We believe the building of more buildings without adequate parking would be a detriment to us all. Sincerely, _ n2. t q r►1 Wayne Reinert /�/Cdr `5i5 f ri 1 J yes G A J-70 Pcl� rile. <_P G� f�6v, 6o,� 8 r:�w CrA4 417 c �C� f 7 ff r3. C qi z bqj b� fir' �-• �, r f ^ ` NOTICE OF PUBLIC HEARING CITY COUNCIL/REDEVELOPMENT AGENCY COULTRUP DEVELOPMENT COMPANY DISPOSITION AND DEVELOPMENT AGREEMENT MAIN-PIER REDEVELOPMENT PROJECT AREA On Monday, December 21, 1992, at 7:00 PM, or as soon thereafter as the matter may be heard, at the City Council Chambers located at 2000 Main Street, Huntington Beach, California, the City Council of the City of Huntington Beach and the Redevelopment Agency of the City of Huntington Beach will hold a joint public hearing to consider approval of an Disposition and Development Agreement (the "Agreement") by and among the Redevelopment Agency of the City of Huntington Beach (the "Agency"), and Jon Coultrup and Birtcher Real Estate Limited, as developer, for the development of the property bounded by Main and 6th streets, Pacific Coast Highway, and Walnut Avenue. The proposed Agreement and a staff report including a summary of the Agreement is available for public inspection at the Office of the City Clerk, 2000 Main Street, Huntington Beach, California. Should you desire further information concerning this matter, call Keith Bohr at (714) 374-1529. CONNIE BROCKWAY, CITY CLERK/AGENCY CLERK, City Council/City of Huntington Beach, Redevelopment Agency, City of Huntington Beach. Published December 3, 10, and 17, 1992 1157r ' MY CLEAR Y • CITY OF RUW11"I"11 AFACKCALIF. e SEP tt 3 21 PH '92 Sevtember 21st. 1992. To CITY COUCIL/REDEVELOPMENT AGENCY. City of Huntington Beach. Centlemen, We.the undersigned are opposed to the demolition of the buildings located at 470,416,504,508 5 5081 Pacific Coast Highway. The reason being that we and our friends work and live near here. And low income housing and employement are very hard to find with today's economic situation. And we request you to give us some time to obtain legal counsel. 4 Thanking you, Tru ly your Wayne Reinert. P r' 4170 Ar,11 V& 9-1�7 f6 /,�I-If -7 �! s3 C-q Ll � o soar $rlan W.OsrAa,► 4,z - 12.6 yid G.4 Huy Apt *7 N-,KAjh4 M ed; C., / y e ' O 1-I C RECEIVED OUXXARY RXPORT PURSUANT TO CITY CLERK CITY OF SACTION 33433 Hltf';rlf;r•Tr►. •'.r�.".M.LdUF. of the CALIYORNIA COXXUXXTY RIDEVSLOPKENT 4R; 1 i i 51 an a DISPOSITION AND DXVSLOPXBNT AGR XXZNT by and betvaen the MDR7ZLOPX2NT AoNNCY OY TER CITY OP HUNTINGTON BEACH ' whd COULTRUP AND BIRTCRER RZAL ESTATE LIXITBD This su=ary report has been prepared for the Huntington Beach Redevelopment Agency ("Agency") pursuant to Section 33433 of the California Health and Safety Code. This report sets forth certain details of the proposed Disposition and Development Agreement ("Agreement") between the Agency and Jon Coultrup and Birtcher Real Estate Linited ("Developer") . The Agreement requires the Agency to purchase the privately owned parcels on Block 1050 bounded by 5th Street, walnut Avenue, 6th Street and Pacific coast Highway. This land assemblage is taking place to allow for the construction of So condominiui units. The privately owned portion of Block 104 , bounded by Main Street, Walnut Avenue, 5th Street and Pacific Coast Highway will be developed by the existing property owners with a Mix of commercial uses . The proposed residential and cor.mercial development is .located in the Main Pier Redevelopment Area in the City of Huntington Beach. This report describes and specifies; 1 . The coat of the proposed agreement to the Agency, including relocation costs, site clearance coats, toxic remediation costa, infrastructure costs and public parking costs; 2. The estimated value of the interests Conveyed, determined at the highest uses permitted under the Redevelopment Plane and 3 . The - purchase price to be paid by the Developer for the interests being conveyed. This report and the proposed Agreement are to be pade available for public inspection prior to the approval of the Agreement. A. SALIENT POINTS OY THE AGRIEXENT 1. j2eveloper..Reapong-jbil it Jos Under the proposed Agreement, the Developer has the following Block 105 responsibilititss a. The Developer agrees to purchase the 71,452 square foot parcel from the Agency. p.03 b. The Developer is responsible for demolishing the existing improvements located on the Block 105 propQrties currently Lander private ownership. c, The Developer must contribute to the toxic clean-up costs incurred on Blocks 104--and 105, to a maximum of $,125, 000. d. The Developer agrees to construct 80 condominium units and a subterranean parking garage with sufficient opaoes to meet the City code, o. The Developer is ro sponsible for all on-cite and off-rite improvement, on Block 105, except that portion adjacent to the Worthy Property, to be paid by the Agency. f. As a part of the land acquisition payment, the Developer has agreed to incorporate a participation formula which allows the Agency to share in the project ' s net profits . The participation formula will be based on the project revenues generated in excess of the construction loan and the equity contributions repayment, plus a threshold profit of $3 . 2 million, Thereafter, the Agency would share in 50t of the subsequent revenues generated by the Block 105 project. The proposed participation formula will be impacted by fluctuations in the allowable development costs, the sales revenues and the time period required to sell the units . Based on current development cost and sales revonue estimate®, the Agency will ngl receive any participation income. Only if the project is significantly more successful than is currently anticipated, will the Agency receive any participation income. The Developer has the following Block 104 responsibilities . These responsibilities will be fulfilled by a partnership comprised of the Developer and the various owners of the Block 104 properties: g. The partnership will demolish the existing commercial structures on Block 104 . h. The partnership will develop and design Block 104 with 47 , 500 square foot of commercial buildings comprised of retail and office uses, respecting the separate ownership of the parcels on Block 104 , The commercial development will be an integrated complex in conformance with the Pain-Pier project Area Plan. i, The partnership is _iesponsible for all on-site improvements on Block 104 . 2 -- -- •+-•� +Y•Jv ciJ qCC r7Chi4 ,,,, Y ill 1 UZILJ V rV y•... - - _ y - r 2. The Agency is responsible for and shall commit the following to the project: a. Purchase the third party parcel necessary to complete the assemblage of the Block 105 site. The acquisition costs are estimated at $630,000, based on an appraisal conducted February 1992. b. compensate the property owners participation in the development for relocation expenses of $380,000. Additionally, pay relocation expenses for the non- participating property owners, which are currently estimated at $250, 000. c. Finance the investigation and clean-up of toxic$ on the Agency-owned parcels on both Block 104 and Block 105, not to exceed $200, 000. As a separate obligation, the Agency shall pay any necessary clean-up costa on the Sarrabers/ wood/Goodman parcel, in an amount equal to $100, 000. d. Finance the public improvements required for Block 104 , and the off-sites required around the perimeter of the Worthy property, astizated at $250, 000. el pay any increased City permits and fees costs lnposed between November, 1992 and six months after approval of Downtown Specific plan by the California Coastal commission. This cost is estimated at $200, 000. f. Provide housing units to meet the Mate mandated inclusionary housing requirements. B. CasT or AARaZKZBrT To AGENCY The estimated costa of the Agreement to the Agency are as follows: Land Acquisition, Relocation and Toxic Remediation Costs Already Expended $ 41520,000 Land Acquisition 630,000 Relocation Costs 630,000 Toxic Remediation Costa - Agency Parcels 200,000 Toxic Remediation Costs - Third Party Parcels 1000000 Block 104 and 105 Public Improvements 250,000 Increased City Permits & Fees 2901M Total Coats to Agency $ 6,530,000 3 t In addition, the Agency has agreed to accept the responsibility for two additional contingent liabilities: a. The Block 104 development will not proceed until the Fall of 1993. At that time, the partnership may incur interest costa in excess of the rates currently being charged to finance the Block 104 commercial improvements. The Agency has agreed to fund the net present value of the interest differential up to a maximum of two percentage points. Assuming that the maximum level of assistance is provided, the cost to the Agency is $490, 000. b. In the event the Block 104 development is completed, but the Developer is unable to develop the Block 105 residential project, the Agency will reimburse the Developer for $850, 000 in Block 104 costs. The maximum costs to the Agency after inclusion of the contingent liabilities and offsets. for the public revenues, are estimated at: Total Costa to Agency $6,530, 000 Plus: Interest Rate Writedown 490,000 Plus: Block 104 Cost Reimbursement - 850 QU Total costs including Contingent Liabilities $7,8701000 (Less) Developer Land Payment for Block 205 (11800,000) (bees) 501 Equity Share in Net Profit to) Net Costa to Agency $61070,000 (Lose) PV of Property Tax Increment Revenues (11720,000) Net Costs to Agency After Tax Increment $4,350, 000 C. aeTIXATED VALVE OF THE INTIREST8 TO BE • CONUBYED To THg DEVALOPER DETERxINED AT THE HIGHEST USE VERMITTED UNDER TEa RZMELOMENT PLAN The terms of the Agreement call for the current property owners to maintain ownership of Block 104, and for the Agency to convey Block 105 to the Developer. The determination of the estimated value of the interests to be conveyed to the Developer was made by R.P. Laurain & Associates in an appraisal dated September 9, 1992. The appraisal identified the highest and best use permitted under the Redevelopment Plan as a high density residential project. The aYs praisal determined that the fair market value for that use $4 .65 million. 4 11-11-1992 13:51 213 E22 5204 KEV5ER MARSTON ASSOC. P.06 w D. PURCEA9E PRICK PAID BY THE DEVELOPER AND REAGON8 FOR DIFFARRINCE IN FAIR MARKET VALVE FOR THE HIOHEBT U8a UNDER THE REDEVE LOMENT PLAN As detailed in the 6aptamber 9, 1991 valuation analysis performed by R.P. Laurain & Associates, Inc. , the highest and beat use of the Block 105 site is a high density residential development. The fair market value of the subject site in estimated at . $4 . 65 million, or $65 per square foot of land area. However, the Agency has limited the scope of development to 80 condominium units. This reduction in density diminishes the supportable land value to $1.8 million. The purchase price plus the participation in net profits represent fair compensation for the subject site. 5 The 33433 report ' for the Coultrup project estimates land acquisition, relocation and toxic renediation costs already expended as $4,520,000. These costs are comprised of: Land_Acguinition Tharp $ 352,500 Energy 176,500 Conley 352,500 Shupe 295,625 Omohundro 10300, 000 Terry 1, 3821000 (774 of costs-bal to Abdelmuti) city 63 , 905 City 21,448 ---------- Total Land Acq $3, 944,478 Denolition/Toxico Relocation 573, 500 r w rr Ttl Sunk Costs $4 ,517, 978 The contingent liability to reimburse the developer for $830, 000 in Block 104 costs is comprised of the following: Upon execution of the DDA $200, 000 (This is reimbursed by the developer if Block 105 is constructed, or if the project terminates due to financing) Public Improvement Costs for 470,000 Block 104 Additional reimbursement for 1800000 out-of-pocket expenses -------- $850, 000 6 A1ter5 days return to HUNTINGTON BEACH CITY SCHOOL DISTRICT P.O.Box 71 HUNTINGTON BEACH,CAUFORNIA92648 {ors. Connie Brockway, City Clerk City of Huntington Beach ti yG yJi C'i'P�n sow -44 DISPOSITION AND DEVELOPMENT AGREEMENT by and between the REDEVELOPMENT AGENCY OF TH': CITY OF HUNTINGTON BEACH, AGENCY, and COULTRUP COMPANIES, a California corporation AND BIRTCHER REAL ESTATE LIMITED, DEVELOPER TABLE OF CONTENTS I . [ §100] SUBJECT OF AGREEMENT A. [ §101] Purpose of Agreement B. [ §102 ] The Redevelopment Plan C. [ §103 ] The Site D. [ §104] Parties to the Agreement 1. [ §105] The Agency 2. [ §106] The Developer 3. [ §107] Representations and Warranties of the Parties 4. [ §108] Guarantors S. [ §109] Prohibition Against Change in Ownership, Management and Control of Developer 6. [ §110] Transfer of Limited Partnership Interest; Indemnity 7. [ §111] Good Faith Deposit 8. [ §112] Relationship of Agency and Developer II . [6200] ASSEMBLY OF THE SITE A. [ §201] Acquisition of Third Party Parcels i B. [ §202] Disposition of Agency Parcels; Actions to be Performed Prior to Transfer; Agency Assistance C. [ §203] Escrow D. [ §204] Conveyance of Title E. [ §205] Condition of Title for the Conveyance F. [ §206] Time for and Place of Delivery of Documents G. [ §207] Title Insurance for the Conveyance H. [ §208] Taxes and Assessments (i) I . [ §209] Environmental Matters J. [ §210] Conditions Precedent to the Conveyance K. [ §211] Land Use Entitlements III . [ §300] DEVELOPMENT OF THE SITE A. [ §301] Development of the Site by the Developer 1. [ §302] Scope of Development 2. [ §303] Site Plan 3. [ §304] Construction Drawings and Related Documents 4. [ §305] Cost of Construction S. [ §306] Construction Schedule 6. [ 5307] Anti-Discrimination During Construction 7. [ §308] Bodily Injury and Property Damage Insurance B. [ §309] Certificate of Completion C. [ §310] No Encumbrances Except Mortgages and Deeds of Trust D. [§311] Holder Not Obligated to Construct Improvements E. [ §312] Notice of Default to Mortgage or Deed of Trust Holders; Right to Cure F. [ §313 ] Failure of Holder to Complete Improvements G. [§314] Right of the Agency to Cure Mortgage or Deed of Trust Default H. [ §315] Right of the Agency to Satisfy Other Liens on the Site After Title Passes IV. [ §400] USE OF THE SITE A. [§401] Uses B. [ §402] Maintenance of the Site (ii) C. [ §403 ] Rights of Access D. [ §404] Effect of Violation of the Terms and Provisions of this Agreement After Completion of Construction V. [ §500] GENERAL PROVISIONS A. [ §501] Notices, Demands and Communications Between the Parties B. [ §502 ] Conflicts of Interest C. [ 6503 ] Enforced Delay; Extension of Times of Performance D. [§504] Nonliability of Officials and Employees of the Agency VI . [ §600] DEFAULTS AND REMEDIES A. [ §601] Defaults -- General B. [ §602] Legal Actions 1. [ §603 ] Arbitration 2. [ §604] Applicable Law 3. [ §605] Acceptance of Service of Process C. [ §606] Rights and Remedies Are Cumulative D. [ §607] Inaction Not a Waiver of Default E. [ §6081 Remedies and Rights of Termination 1. [ §609] Damages 2. [ 5610] Specific Performance 3. [ §611] Termination by the Developer 4. [ §612 ] Termination by the Agency S. [ §613] Termination Resulting in Completion of Block 104 VII . [ §700] SPECIAL PROVISIONS A. [ §701] Real Estate Commissions B. [ §702] Successors In Interest (iii) C. [ §703 ] Amendments to this Agreement D. [ 6704] Attorney Fees E. [ §705] Release of Claims VIII . [ §800] ENTIRE AGREEMENT, WAIVERS ATTACHMENTS Attachment No. 1 Site Map Attachment No. 1-A Proposed Site Map Attachment No. 2 Legal Description Attachment No. 3 Scope of Development Attachment No. 4 Schedule of Performance Attachment No. 5 Third Party Parcel Grant Deed Attachment No. 5-A Cracchiola Grant Deed Attachment No. 6 Agency Parcels Grant Deed Attachment No. 7 Deed of Trust Attachment No. 8 Certificate of Completion Attachment No. 8-A Partial Certificate of Completion Attachment No. 9 Covenants for Block 105 Attachment No. 9-A Covenants for Block 104 Attachment No. 10 Guaranty Attachment No. 11 Property Owners Partnership Agreement Attachment No. 12 Schedule of Existing Parking Credit for Each Limited Partner' s Current Use Attachment No. 13 Equity Participation Procedure (iv) DISPOSITION AND DEVELOPMENT AGREEMENT THIS AGREEMENT is entered into by and between the Redevelopment Agency of the City of Huntington Beach, a public body, corporate and politic, (the "Agency" ) and Coultrup Companies, a California corporation and Birtcher Real Estate Limited, a California limited partnership (the "Developer") . The Agency and the Developer hereby agree as follows: I. [ §100] SUBJECT OF AGREEMENT A. [ §101] Purpose of Agreement The purpose of this Agreement is to effectuate the Redevelopment Plan (as hereinafter defined) for the Main Pier Redevelopment Project by providing for the disposition and development of certain property bounded by Pacific Coast Highway, Main Street, Sixth Street and Walnut Avenue within the Project Area (the "Site") . The Site is depicted on the "Site Map", which is attached hereto as Attachment No. 1 and incorporated herein by this reference. The Site is to be developed, pursuant to this Agreement, for commercial and residential use, as described in more detail hereinafter in the Scope of Development attached hereto as Attachment No. 3 and incorporated herein by this reference (the "Project") . This Agreement is entered into for the purpose of expeditiously developing the Site and not for speculation in land holding. Completing the development on the Site pursuant to this Agreement is in the vital and best interest of the City of Huntington Beach, California (the "City") and the health, safety and welfare of its residents, and in accord with the public purposes and provisions of applicable state and local laws and requirements under which the Redevelopment Plan (as hereinafter defined) has been undertaken. B. [ §102] The Redevelopment Plan The Redevelopment Plan was approved and adopted by the City Council of the City of Huntington Beach by Ordinance No. 2578, as amended by Ordinance No. 2634; said ordinances and the Redevelopment Plan as so approved and amended (the "Redevelopment Plan" ) are incorporated herein by reference. C. [ §103 ] The Site The Site is that portion of the project area designated on the Site Map (Attachment No. 1) . The Site is composed of two separate blocks of property known as Block 104 and Block 105. Block 104 consists of the following parcels: 1. Six third party parcels owned separately by the general partners of the partnership which has Coultrup Companies as its managing partner and which by the terms of its Partnership Agreement attached hereto as Attachment No. 11, has committed to implement the obligations to develop Block 104 (the "Property Owner' s Parcels" ) ; 2. Two parcels owned by the Agency (respectively the "Agency Parking Parcels and the Agency Exchange Parcel") ; 3. A portion of a public right-of-way to be vacated subject to the terms and conditions set forth herein (the "Alley" ) . Block 105 consist of: 1. Two parcels owned by Sarrabere-Wood and Goodman, tenants in common, (collectively the "Sarrabere-Wood-Goodman Parcels" ) ; 2. Seven parcels owned by the Agency (collectively the "Block 105 Agency Parcels") ; 3. A parcel owned by Frank, Dolores, Salvador and Barbara Cracchiolo (the "Cracchiolo Parcel") . Each of the foregoing enumerated parcels is designated on the Site Map (Attachment No. IA) . The legal descriptions of each of the Parcels are attached hereto as "Attachment No. 2" and incorporated herein by this reference. Pursuant to this Agreement, each of the Parcels and the Alley shall be reconfigured into the Proposed Site Plan (Attachment No. 1B) pursuant to the procedures required by the City under the Subdivision Map Act (California Government Code §§ 66410 et seq. ) , D. [ §104] Parties to the Agreement 1. [ §105] The -Agency The Agency is a public body, corporate and politic, exercising governmental functions and powers and organized and existing under Chapter 2 of the Community Redevelopment Law of the State of California. The principal office of the Agency is located at City Hall, 2000 Main Street, Huntington Beach, California 92648. 08/12/92 6449u/2460/009 -2- "Agency", as used in this Agreement, includes the Redevelopment Agency of the City of Huntington Beach, and any assignee of or successor to its rights, powers and responsibilities. 2 . [ §106] The Developer The Developer is joint venture with joint and several liability between Coultrup Companies, a California corporation, and Birtcher Real. Estate Limited, a California limited partnership. The address of the Developer for the purposes of this Agreement is P.O. Box 1270,Sunset Beach , California 90742 3 . [ §1071 Representations and Warranties of the Parties A. The Developer, to the best of his knowledge, represents and warrants to the Agency as follows: (i) The Developer has duly authorized, executed and delivered this Agreement and any and all other agreements and documents required to be executed and delivered by the Developer prior to execution of this Agreement in order to carry out, give effect to, and consummate the transactions contemplated by this Agreement. (ii) The Developer does not have any material contingent obligations or any material contractual agreements which could materially adversely affect the ability of the Developer to carry out his obligations hereunder. (iii) There are no known material pending or, so far as is known to the Developer, threatened, legal proceedings to which the Developer is or may be made a party or to which any of its property is or may become subject, which has not been fully disclosed to the Agency which could materially adversely affect the ability of the Developer to carry out his obligations hereunder. (iv) There is no action or proceeding pending or, to the Developer' s best knowledge, threatened, by or against the Developer which could affect the validity and enforceability of the terms of this Agreement, or materially and adversely affect the ability of the Developer to carry out his obligations hereunder. (v) The Developer has performed all of his obligations to be performed at or prior to the date of Developer' s execution of the Agreement in accordance with the Schedule of Performance and is not in default hereunder. 08/12/92 6449u/2460/009 -3- Each of the foregoing items i to v, inclusive shall be deemed to be an ongoing representation and warranty. The Developer shall advise the Agency in writing if there is any change pertaining to any matters set forth or referenced in the foregoing items i to v, inclusive. B. The Agency, to the best of its knowledge, warrants and represents to the Developer as follows: (i) The Agency has duly authorized, executed and delivered this Agreement and any and all other agreements and documents required to be executed and delivered by the Agency prior to the execution of this Agreement in order to carry out, give effect to, and consummate the transactions contemplated by this Agreement. (ii) The Agency does not have any known material contingent obligations or any known material contractual agreements which could materially adversely affect the ability of the Agency to carry out its obligations hereunder. (iii) There are no known material pending or threatened, legal proceedings to which the Agency is or may be made a party or to which any of its property is or may become subject, which has not been fully disclosed to the Developer which could materially adversely affect the ability of the Agency to carry out its obligations hereunder. (iv) There is no action or proceeding pending or, to the Agency' s best knowledge, threatened, looking toward the dissolution or liquidation of the Agency, and there is no action or proceeding pending or, to the Agency' s best knowledge, threatened by or against the Agency which could affect the validity and enforceability of the terms of this Agreement, or materially and adversely affect the ability of the Agency to carry out its obligations hereunder. (v) The Agency has performed all of its obligations to be performed at or prior to the date of Agency' s execution of this Agreement in accordance with the Schedule of Performance and is not in default hereunder. Each of the foregoing items i to v, inclusive shall be deemed to be an ongoing representation and warranty. The Agency shall advise the Developer in writing if there is any change pertaining to any matters set forth or referenced in the foregoing items i to v, inclusive. 08/12/92 6449u/2460/009 -4- 4. 1 §1081 The Guarantors The 'Guarantors" are Birtcher Real Estate Limited and Jon Coultrup, an individual. The Guarantors will benefit materially by the execution of this Agreement. Prior to and as a condition of the Conveyance of the Agency Block 105 Parcels (as set forth in Section 201 hereof) the Guarantors shall execute and deliver to the Agency the guaranties of each and every obligation of the Developer pursuant to this Agreement in the form of the "Guaranty" which is attached hereto as Attachment No. 10 and is incorporated herein by reference. The parties agree and acknowledge that the delivery of the Guaranty by the Guarantor is a material inducement for the Agency to convey the Site to the Developer, and that but for the provision of such Guaranty, the Agency would not execute this Agreement or convey the Agency Block 105 Parcels to the Developer. The guaranties are for the sole benefit of the Agency and the City or any successors to their interests and are not intended to be for the benefit of any other party. S. [ §1091 Prohibition Against Change in Ownership, Management and Control of Developer The qualifications and identity of the Developer are of particular concern to the City and the Agency. It is because of those qualifications and identity that the Agency has entered into this Agreement with the Developer. No voluntary or involuntary successor in interest of the Developer shall acquire any rights or powers under this Agreement except as expressly set forth herein. The Developer shall not assign or transfer all or any part of this Agreement or the Site or any rights hereunder prior to the issuance of a Certificate of Completion as defined in Section 309 of this Agreement without obtaining the prior written approval of the Agency. Written approval of the Agency shall also be required prior to any and all changes whatsoever in the identity of the Developer' s general partners or in the individual or entity holding the controlling share of equity in the Developer entity. Any purported transfer, voluntary, involuntary, or by operation of law, except with the prior written consent of the Agency, shall constitute a default of the Developer and shall render this Agreement absolutely null and void and shall confer no rights whatsoever upon any purported assignee or transferee. All of the terms, covenants and conditions of this Agreement shall be binding upon and shall inure to the benefit of the Parties and the permitted successors and assigns of the Parties. Whenever the term "Developer" or "Agency" is used herein, such term shall include any other permitted successors and assigns as herein provided. 08/12/92 6449u/2460/009 -5- Upon the issuance of the Certificate of Completion, attached hereto as Attachment No. 8 and incorporated herein by this reference, pursuant to Section 309 of this Agreement, this Section 109 shall be of no further force or effect. 6. [ §110] Transfer of Limited Partnership Interest; Indemnity Coultrup Companies is the managing partner in the partnership agreement, an executed copy of which is attached hereto as Attachment No. 11 and incorporated herein by this reference (the "Property Owners Agreement" ) . The Property Owners Agreement provides for the ability of the partnership to carry out all responsibilities concerning construction and development of each property owner' s property. The Developer shall become the managing partner of the Property Owners Partnership within one hundred and twenty (120) days of the execution of this Agreement by the Agency. The Developer shall indemnify, hold harmless and defend the Agency and/or the City from any claim, cause of action or suit arising out of or relating to the Property Owners Partnership Agreement and the terms, conditions, responsibilities and obligations between the parties thereto. Such limitations shall not relate to claims made and to Agency actions or responsibilities under this Agreement. 7. [ §111] Good Faith Deposit Prior to execution of this Agreement by the Agency, Developer has previously deposited Twenty Thousand Dollars ($20,000) with the Agency and shall deposit an additional Thirty Thousand Dollars ($30,000) with the Agency ("Deposit" ) for a total deposit amount of Fifty Thousand Dollars ($50,000) to be held by the Agency in an interest bearing account until the Issuance of a Certificate of Completion on the entire project. The Developer may, at its election, substitute in lieu of the cash deposit an irrevocable direct-pay letter of credit in the amount of Fifty Thousand Dollars ($50,000) at an institution and pursuant to terms acceptable to the Agency legal counsel and the Agency Executive Director. In the event that a letter of credit is accepted, the original Twenty Thousand Dollars ($20,000) and interest accrued, if any, shall be returned to the Developer. In the event of termination of this Agreement under Section 611 or Section 612(viii) , the Deposit with all accrued interest shall be returned to the Developer. In the event of termination of this Agreement under Section 612, the Deposit with all accrued interest shall be retained by the Agency. 08/12/92 6449u/2460/009 -6- 8. [ §112 ] Relationship of Agency and Developer It is hereby acknowledged that the relationship between the Agency and the Developer is not that of a partnership nor a joint venture and that the Agency and the Developer shall not be deemed or construed for any purpose to be the agent of the other. II . [ §200] ASSEMBLY OF THE SITE A. [ §201] Agency Acquisitions 1. Acquisition of Sarrabere-Wood-Goodman Parcels Provided that the Developer is not otherwise in default hereunder, within the time set forth in the Schedule of Performance, the Agency shall, after attempting to acquire by negotiation, conduct a hearing to consider the adoption of a resolution of necessity in its sole discretion, as the initial step to determine whether to acquire the Sarrabere-Wood-Goodman Parcels by exercise of its power of eminent domain. If the Agency adopts a resolution of necessity and elects to exercise its power of eminent domain, such election shall be made and the eminent domain action(s) filed within the time set forth in the Schedule of Performance; provided, that nothing in this Agreement shall be deemed to constitute a commitment by Agency to condemn property or a prejudgment of the matters required to be considered as part of any decision to condemn property. In the event Agency determines to adopt the resolution of necessity the Agency shall provide the offer amount, based on the appraisal, which must be filed with the court at the time the eminent domain action is filed in order to apply for the order of immediate possession. The Developer shall provide within fifteen (15) days of adoption of a resolution of necessity One Hundred Thousand Dollars ($100,000) in cash or in the form of a direct pay letter of credit (the Acquisition Letter of Credit") payable to the Agency, in a form subject to the reasonable approval of the Agency' s counsel, drawn upon a bank or other financial institution authorized to do business in the State of California and which has been approved by the Director of Administrative Services for the City (who shall act reasonably in making such determination) , as security for the Agency' s costs (the "Acquisition Costs, " as that term is defined below) expended in the acquisition of the Sarrabere-Wood-Goodman Parcels. Prior to drawing down on the Acquisition Letter of Credit the Agency Executive Director shall make a direct demand to Developer for payment of Acquisition Costs incurred on a monthly basis and providing such demand is satisfied within fifteen (15) days of presentation the Agency shall not make a demand upon the Acquisition Letter of Credit. A determination 08/12/92 6449u/2460/009 -7- not to adopt a resolution of necessity shall provide additional grounds for termination of this Agreement by the Agency or Developer under Sections 210 or 211 herein. Upon Agency acquisition of any of the individual parcels or property interests comprising the Sarrabere-Wood-Goodman Parcels, the Agency and Developer agree that said parcels shall be conveyed to the Developer within the time set forth in the Schedule of Performance (Attachment No. 4) and said property interests shall be terminated, and the Agency and Developer shall cooperate and execute any documents required to effect such conveyance(s) and to remove said property interests of record. In the event that the Agency exercises its power of eminent domain to acquire the Sarrabere-Wood-Goodman Parcels, the Agency shall, upon the Developer' s written request, exercise its best efforts to obtain a judicial order or orders (hereinafter "Order of Prejudgment Possession" ) authorizing the Agency to take possession of the premises prior to the final order(s) of condemnation. Notwithstanding any other provision of this Agreement to the contrary, if, at any time prior to the Agency' s acquisition of the Sarrabere-Wood-Goodman Parcels, the Agency provides to the Developer a copy of an Order of Prejudgment Possession for all of the individual parcels or property interests comprising the Sarrabere-Wood-Goodman Parcels, and: (i) The right to take is not an outstanding issue as either being waived, settled or finally decided with the appeal period having ellapsed; (ii) Agency delivers possession of the premises which are the subject of the Order of Prejudgment Possession; (iii) Agency is diligently proceeding with eminent domain action(s) seeking the rendering of a final judgment or judgments, which judgment or judgments would authorize the taking, and the Agency agrees to convey fee title to the parcel or terminate the property interest, as applicable, when Agency completes the acquisition; and (iv) The right of possession conveyed by the Agency to the Developer is sufficient to enable the Developer to obtain a title insurance policy as necessary to close its construction and permanent loans for the development of the Site; 08/12/92 6449u/2460/009 -8- then, the Developer shall accept such right of possession and proceed with the development of the Site, with the date of transfer of possession from the Agency to the Developer treated the same as the date of close of escrow for purposes of the Developer' s obligation to proceed with and complete construction. Upon the request of the Title Company, the Agency shall execute an indemnification agreement in form satisfactory to such Title Company and reasonably satisfactory to the Agency by which the Agency shall agree to indemnify the Title Company for any losses, damages and expenses incurred by the Title Company in the event of the Agency' s abandonment of the eminent domain proceedings. Nothing herein shall be deemed to obligate the Agency to pay for any additional premium or other charge necessary for the issuance of said title policy. In the event that no title insurance company will issue a standard ALTA (CLTA) policy in a form with exceptions that will not effect the ability of the Developer to complete the project, the Developer' s obligation to commence and complete construction shall be delayed until either a reasonably acceptable title policy is obtained or the Agreement is terminated. The term "Acquisition Costs" as used herein shall mean all costs reasonably incurred by the Agency for acquisition of any of the individual parcels and property interests comprising the Sarrabere-Wood-Goodman Parcels. The Agency' s Acquisition Costs shall include, but not be limited to, costs for real estate purchases and option agreements, escrow fees and charges, title insurance, relocation expenses, court judgments, court costs, attorney' s fees, appraisal fees, and expert witness fees. 2. Acquisition by Exchange of Cracchiolo Parcel Agency and Cracchiolo have agreed to an even exchange (equity for equity each parcel to be free and clear of all liens and encumbrances) of the Agency Exchange Parcel on Block 104 and the Cracchiolo Parcel on Block 105. The escrow on this exchange is to close prior to the transfer of the Agency Block 105 parcels to Developer. Cracchiolo has been informed that in the event he is unwilling to complete the described exchange that the Agency would be forced to schedule a hearing to consider the adoption of a resolution of necessity to condemn his property. In the event that the Agency determined it was necessary to proceed with an eminent domain action the Developer would bear all Acquisition Costs as defined in paragraph 1 above and provide cash or a letter of credit in an amount of one hundred and fifty percent (150%) of the appraised value of the Cracchiolo Parcel in advance of the filing of the eminent domain action. 08/12/92 6449u/2460/009 -9- 3. Acquisition of Property Owners Parcels The Property Owners have agreed pursuant to their Property Owners Agreement (Attachment No. 11) to cooperate with all actions necessary for the Developer to perform the responsibilities of the Developer related to Block 104. The Property Owners have been informed that in the event any one of them is unwilling to cooperate with the Developer the Agency would be forced to schedule a hearing to consider the adoption of a resolution of necessity to condemn their property. In the event the Agency determined it was necessary to proceed with an eminent domain action, all Acquisition Costs as defined in paragraph 1 above shall be borne by Developer and Developer shall provide cash or a letter of credit in an amount of one hundred and fifty percent (150%) of the appraisal value of the particular Property Owner' s Parcel in advance of the filing of the eminent domain action. B. [ §202] Dis osition of Agency Block 105 Parcels• Actions to be Performed Prior to Transfers; Agency Assistance Subject to applicable terms and conditions of this Agreement, the Agency agrees to provide Agency Assistance as described below, and to sell the Agency Parcels and the Sarrabere-Wood-Goodman Parcels and the Cracchiola Parcel to the Developer and the Developer shall purchase the Agency Parcels, the Sarrabere-Wood-Goodman Parcels and the Cracchiolo Parcel from the Agency. The purchase price for the Agency Parcels, the Sarrabere-Wood-Goodman Parcels and the Cracchiola Parcel shall be equal to the amount of One Million Eight Hundred Thousand Dollars ($1,800,000) plus an equity share interest as defined in the Equity Participation Procedure attached hereto and incorporated herein by this reference as Attachment No. 13 (the "Purchase Price" ) . The Developer shall receive a credit towards the Purchase Price equal to any Acquisition Costs as defined in Section 201 which have been advanced prior to close of escrow. After the close of escrow the Agency shall be responsible for all additional Acquisition Costs for acquiring the Sarrabere-Wood-Goodman Parcels including the judicially determined purchase price as determined to be the fair market value of the property. Developer would remain responsible for all eventual costs for any eminent domain actions for the Cracchiolo Parcel or other Property Owner Parcels. The conveyance from the Agency to the Developer of the Agency Parcel(s) and the Sarrabere-Wood-Goodman Parcel(s) is subject to the following terms and conditions: 08/12/92 6449u/2460/009 -10- 1. Acquisition of Complete _Site. The Agency shall have acquired all of the individual parcels and property interests comprising the Sarrabere-Wood-Goodman and Cracchiolo Parcels (or the Agency shall have obtained an Order of Prejudgment Possession and any issue as to right to take shall be finally resolved for any of such parcels or property interests for which fee title has not yet been obtained, with such Order meeting the requirements of Section 201 above) ; 2. Acce tance of Title Policies. Developer approved preliminary title policies to Agency Block 105 Parcels and the Sarrabere-Wood-Goodman Parcels and the Cracchiolo Parcel. 3. Vacation of Alle . The City Council shall have adopted its resolution conditionally approving vacation of the Alley, as referenced in Section 201 above, with such vacation(s) to be effective concurrently with the close of the escrow for the Agency Parcels; 4. Subdivision and Conditional Use Permit Approval. Developer and Agency will cooperate in applications to City under the applicable subdivision approval requirements for reconfiguration of the parcels comprising the Site, vacation of the Alley and for any necessary conditional use permits. Developer shall be responsible for preparing and processing such applications and paying all application fees. The final tract map shall be recorded concurrently with Agency' s transfer to Developer of the Agency Parcels and the Sarrabere-Wood-Goodman Parcels. Developer and Agency shall be satisfied with all conditions placed on the conditional use permit. 5. Financing; Submittal of Evidence of Financing Commitments. Within one hundred and twenty (120) days of the execution of this Agreement and prior to the conveyance of the Agency Parcels and the effective date of the City' s resolution vacating the portions of the Alley, the Developer shall submit to the Agency' s Executive Director evidence reasonably satisfactory to the Executive Director that the Developer has obtained the construction financing necessary for the development of the Project on the Site. Such evidence shall include documentation of each limited partner' s financing for the construction on their individually-owned parcel. Such evidence of construction financing shall include the following: 08/12/92 6449u/2460/009 -11- a. A copy of the commitment or commitments obtained by the Developer for the mortgage loan or loans (both for interim construction financing) to assist in financing the construction of the Project (as defined in the Scope of Development (Attachment No. 3) ) , certified by the Developer to be a true and correct copy or copies thereof. The commitments for financing shall be in such form and content acceptable to the Executive Director as reasonably evidences a firm and enforceable commitment, with only those conditions which are standard or typical for the lender(s) involved for similar projects; and b. Sufficient information (e.g. , an annual report) regarding the construction, interim and/or permanent lenders to enable the Executive Director to determine whether or not such lender(s) has (have) sufficient financial resources to fund the loan(s) ; and C. A financial statement and/or other documentation satisfactory to the Executive Director as evidence of other sources of capital, including a fifteen percent (15%) of construction costs equity contribution from Developer, sufficient to demonstrate that the Developer has adequate funds committed by itself or otherwise to cover the difference, if any, between construction and development costs minus financing authorized by mortgage loans; and d. A copy of the contract between the Developer and each general contractor for the construction of both portions of the Project, certified by Developer to be a true and correct copy thereof. Within fifteen (15) days after receipt of the Developer' s request for approval of its evidence of construction financing, the Executive Director shall respond in writing by stating what further information, if any, the Executive Director reasonably requires in order to determine whether or not to approve such evidence of financing. Upon receipt of such a timely response, the Developer shall promptly furnish to the Executive Director such further information as may be reasonably requested. The Executive Director shall reasonably approve or disapprove the Developer' s evidence of construction financing within fifteen (15) days after the Developer' s request for such approval is accepted as 08/12/92 6449u/2460/009 -12- complete. If the Executive Director disapproves any such evidence of financing, written notice shall be provided to the Developer stating the reasons for such disapproval. 6. Project Designni_Design and Construction Costs; Agency Assistance. Subject to the costs to be incurred by the Agency pursuant to this Agreement, Developer shall, at his sole cost and expense, design and construct the Project pursuant to the Scope of Development (Attachment No. 3) , as an approximately 80 to 90 unit residential condominium building on Block 105 and a up to three-story commercial office/retail buildings totaling approximately 47,500 square feet on Block 104. Exact number of unit and conditions on Project may be subject to change during the entitlement process with the City. Plan application by Developer shall be submitted to and accepted by the City planning department as complete within ninety (90) days of the execution of this Agreement. The Developer shall select, oversee and coordinate either a single general contractor for all of the work proposed for Block 104 and Block 105 or one for each. Construction shall be initiated within two hundred and forty (240) days from final plan approval by City. The Developer and the Agency shall provide dedications necessary to construct the Project from their respective Parcels at their expense. Developer shall be responsible for obtaining any such necessary dedications from the Property Owners Parcels. 7. Soils Remediation. Parties understanding with respect to soils remediation and obligations is set out in Section 209 below. 8. Parking. Agency shall provide non-exclusive public ground level parking spaces located in Block 104. If a need for additional parking has been established to the Agency' s satisfaction or when required by the City, at its sole discretion, the Agency may pay an in-lieu fee or construct an on site multi-level parking garage above a portion of the ground level parking. The individual property owners shall be granted a credit for the number of parking spaces which would be currently required for their existing uses as shown on Attachment No. 12 attached hereto and incorporated herein by this reference. The Agency shall provide funding or additional spaces in an onsite structure for any parking required by the City for the uses initially proposed in the Project until the date January 1, 2019. Any in-place parking 08/12/92 6449u/2460/009 -13- structure may contain other uses besides parking. After January 1, 2019, any costs associated with parking and/or the in-place parking structure shall be the obligation of the then property owners. Notwithstanding the above, any charges for use (i .e. , meter costs, etc. ) made to the general public shall be equally applicable to the property owners. Developer shall provide all parking required by the City for the Block 105 Improvements and shall pay all costs associated with the construction of such parking facilities. 9. Public Improvements. Developer shall pay for all of the Block 105 onsite and offsite improvements as described in the Scope of Development (Attachment No. 3) with the exception of those curb, gutter and street improvements fronting the Worthy Parcel. Agency payment toward the Worthy Parcel shall not include sewer, utility, storm drain, traffic impact, or fees associated with the street improvements. The Agency shall either initiate the construction of the Block 104 offsite improvements as described in the Scope of Development (Attachment No. 3) within thirty (30) days of issuance of the first building permit for Block 104 or shall reimburse the Developer after review and written approval by Public Works Director of City of: (i) three bids, (ii) all contracts, (iii) detailed invoices, and (iv) proof of lien releases from subcontractors for those verified costs. Developer shall be responsible for construction and payment of all onsite improvements to Block 104. Agency shall provide utility hook-up to each parcel of Block 104. Agency shall provide costs for construction work necessary for any on-site publicly owned right-of-ways. 10. Relocation. Agency shall pay towards relocation expenses, inclusive of any claim for goodwill or costs associated with relocation of residential tenants, of the Property Owners' Five Hundred Thousand Dollars ($500,000) . Agency shall provide counseling and relocation assistance to tenants, said costs to be deducted from the Five Hundred Thousand Dollars ($500,000) prior to payments to Property Owners. Remaining amounts shall be distributed according to the following schedule: one-third (1/3) upon pulling demolition permit; one-third (1/3) upon obtaining framing check off approval by building official; and the final one-third (1/3) upon issuance of certificate of occupancy. Amounts to be distributed shall be based on amounts set out in the Property Owners 08/12/92 6449u/2460/009 -14- Partnership Agreement (Attachment No. 11) . Any additional amounts shall be paid by Developer. Developer agrees to indemnify, defend and hold harmless Agency and City from any claims for relocation, goodwill, loss of business profits or other damages brought by existing tenants or owners and arising out of or relating to the implementation of this Agreement. 11. Development Fees. For a period of six months after execution of this Agreement, Agency shall pay to the City the difference between development fee amounts applicable as of the date of execution of this Agreement and any increases in said fees. Said fees shall include, but not be limited to, traffic impact fees. After the expiration of the six month period Developer is responsible for the full cost of such fees. 12 . Deed of Trust. A Deed of Trust substantially in the form of Attachment No. 7 shall be executed for recordation on Block 105 properties securing the Developer' s performance under this Agreement in an amount equal to the Agency' s total costs incurred under this Agreement and payment of the "Equity Share Amount. " 13. Equity Share Terms. Developer and Agency agree that a portion of the Purchase Price for the Agency Parcels shall be determined at the time of sale of the individual residential units on Block 105 as provided in the Equity Participation Procedure (Attachment No. 13) . 24. Affordable Housing. Agency shall provide replacement housing units as required by law and shall assure that a minimum of twelve (12) units of affordable housing are provided consistent with Community Redevelopment law. Agency shall have the right to designate twelve units as affordable to low and moderate use pursuant to the guidelines of the City' s requirement. Such designation shall not effect the market price of the unit to the Developer as the Agency' s low to moderate housing funds shall be utilized to make the unit affordable to the designated eligible family or individual. 15. The existing commercial structures on Block 104 shall be demolished at Developer' s cost pursuant to a City approved demolition plan prior to transfer of the Agency Parcels and Sarrabere-Wood-Goodman Parcels. 08/12/92 6449u/2460/009 -25- 16. Block 105 demolition and site grading and protective foundation work solely for purposes of water proofing may occur if the Agency Executive Director authorizes the issuance of an encroachment permit prior to the transfer of the Agency Parcels and Sarrabere-Wood-Goodman Parcels if all conditions precedent listed in Section 210 herein have been satisfied only excepting (x) . Notwithstanding anything to the contrary set forth in this Agreement, the Agency shall have no obligation to transfer the Agency Parcels or to provide and pay any amounts of other Agency Assistance as hereinabove set forth unless all of the "Agency' s Conditions Precedent to the Conveyance" (as hereafter defined in Section 210 of this Agreement) have been satisfied or waived by Agency in its sole and absolute discretion. C. [ §203 ) Escrow The Agency agrees to open an escrow (the "Escrow" ) with a mutually agreeable escrow company (the "Escrow Agent" ) , by the time established therefor in the Schedule of Performance (Attachment No. 4) . The Escrow Agent shall accomplish the recordation of the Agency Parcels Grant Deed, which is attached hereto as Attachment No. 6 and incorporated herein by this reference, the Deed of Trust, which is attached hereto as Attachment No. 7 and incorporated herein by this reference, and the Covenants, which is attached hereto as Attachment No. 9 and Incorporated herein by this reference, all as more particularly set forth herein. This Agreement constitutes the joint basic escrow instructions of the Agency and the Developer for the conveyance of the Agency Parcels and a duplicate original of this Agreement shall be delivered to the Escrow Agent upon the opening of the Escrow. The Agency and the Developer shall provide such additional escrow instructions as shall be necessary for and consistent with this Agreement. The Escrow Agent is hereby empowered to act under this Agreement, and the Escrow Agent, upon indicating within five (5) days after the opening of the Escrow its acceptance of the provisions of this Section 203, in writing, delivered to the Agency and the Developer, shall carry out its duties as Escrow Agent hereunder. Upon delivery of the Agency Parcels Grant Deed (Attachment No. 6) to the Escrow Agent by the Agency and the Deed of Trust (Attachment No. 7) and the Covenants (Attachment No. 9) by the Developer pursuant to Section 205 of this Agreement, the Escrow Agent shall record such deeds when title can be vested respectively in the Developer and the Agency in accordance with the terms and provisions of this Agreement. The Escrow Agent shall pay any applicable transfer tax. Any insurance policies covering the Agency Parcels or any parcel are not to be transferred. 08/12/92 6449u/2460/009 -16- The Developer and the Agency shall pay in escrow to the Escrow Agent all fees, charges and costs as those costs are customarily paid by a buyer and seller of property as to their respective roles with the Agency Parcels and the Sarrabere-Wood-Goodman Parcels promptly after the Escrow Agent has notified the Developer and the Agency of the amount of such fees, charges and costs, but not earlier than ten (10) days prior to the scheduled date for closing the Escrow, including, without limitation, the following: 1. Costs necessary to place title to the Agency Parcels and the Sarrabere-Wood-Goodman Parcels in the condition for conveyance pursuant to Section 205 of this Agreement; 2. The escrow fee; 3. Cost of drawing the deeds; 4. Recording fees; 5. Notary fees; 6. Any State, County or City documentary stamps; 7. Any transfer tax; 8. The premium for title insurance as set forth in Section 207 of this Agreement; and Under verification that all conditions precedent under Section 210 of this Agreement have been satisfied or waived by the appropriate party or parties, the Escrow Agent is authorized to: I. Pay, and charge the Developer and the Agency for any fees, charges and costs payable under this Section 203 of this Agreement. Before such payments or charges are made, the Escrow Agent shall notify the Developer and the Agency of the fees, charges and costs necessary to clear title and close the Escrow. 2. Deliver the deeds and other documents to the parties entitled thereto when the conditions of this Escrow have been fulfilled by the Agency and the Developer. 3 . Record the Deeds of Trust (Attachment No. 7) securing Developer' s performance obligations required pursuant to this Agreement, and any other instruments delivered through this Escrow, 08/12/92 6449u/2460/009 -17- if necessary or proper, to comply with the terms and conditions of this Agreement and vest title in the Developer in accordance with the terms and provisions of this Agreement. All funds received in this Escrow shall be deposited by the Escrow Agent, with other escrow funds of the Escrow Agent in an interest earning general escrow account or accounts with any state or national bank doing business in the State of California. Such funds may be transferred to any other general escrow account or accounts. All disbursements shall be made by check of the Escrow Agent. All adjustments are to be made on the basis of a thirty (30) day month. If this Escrow is not in condition to close on or before the time for conveyance established in the Schedule of Performance (Attachment No. 4) of this Agreement, either party who then shall have fully performed the acts to be performed before the conveyance of title may, in writing, demand from the Escrow Agent the return of its money, papers or documents deposited with the Escrow Agent. No demand for return shall be recognized until ten (10) days after the Escrow Agent shall have mailed copies of such demand to the other party or parties at the address of its or their principal place or places of business. Objections, if any, shall be raised by written notice to the Escrow Agent and to the other party within the ten (10) day period, in which event the Escrow Agent is authorized to hold all money, papers and documents with respect to the Agency Parcels until instructed by a mutual agreement of the parties or by a court of competent jurisdiction. If no such demands are made, the Escrow shall be closed as soon as possible. The Escrow Agent shall not be obligated to return any such money, papers or documents except upon the written instructions of both the Agency and the Developer or until the party entitled thereto has been determined by a final decision of a court of competent jurisdiction. Any amendment to these Escrow instructions shall be in writing and signed by both the Agency and the Developer. At the time of any amendment, the Escrow Agent shall agree to carry out its duties as Escrow Agent under such amendment. All communications from the Escrow Agent to the Agency or the Developer shall be directed to the addresses and in the manner established in Section 501 of this Agreement for notices, demands and communications between the Agency and the Developer. 08/12/92 6449u/2460/009 -18- The liability of the Escrow Agent under this Agreement is limited to performance of the obligations imposed upon it under Sections 202 to 210, both inclusive, of this Agreement. D. [ §204] Conveyance of Title Subject to any extensions of time mutually agreed upon between the Agency and the Developer, conveyance of title to the Agency Parcels shall be completed on or prior to the date specified therefor in the Schedule of Performance (Attachment No. 4) . Said Schedule of Performance (Attachment No. 4) is subject to revision from time to time as mutually agreed upon in writing between the Developer and the Executive Director of the Agency. E. [ §205] Condition of Title for the Conveyance The Agency shall convey title to the Agency Parcels and Alley free and clear of encumbrances except the dedications shown on the Site Map (Attachment No. 1) and otherwise as may hereafter be expressly approved by the Developer in its reasonable discretion in light of the proposed use of the property and lender requirements. F. [ §206] Time for and Place of Delivery of Documents Subject to any mutually agreed upon extension of time, the Agency Parcels Grant Deed (Attachment No. 6) , the Deed of Trust (Attachment No. 7) and the Covenants (Attachment No. 9) , shall be executed, acknowledged, and delivered to the Escrow Agent on or before the date established for the date for the Conveyance pursuant to the Schedule of Performance (Attachment No. 4) . G. [ §207] Title Insurance for the Conveyance Concurrently with recordation of the Grant Deeds (Attachment Nos. 5 and 6) , the Title Company shall provide and deliver to Developer, at Agency' s sole cost and expense, standard coverage ALTA (CLTA) title insurance policies issued by the Title Company insuring that the title to the Site is vested in Developer in the condition required by Section 205 of this Agreement. The Title Company shall provide the Agency with duplicate policies. The policies shall be in the amount of the Purchase Price for each parcel. All additional costs incurred for or related to such title insurance shall be borne solely by the Developer, including, but not limited to, coverage in excess of the Purchase Price for each parcel, additional endorsements, or an ALTA extended coverage policy. 08/12/92 6449u/2460/009 -19- H. [ §208] Taxes and Assessments Ad valorem taxes and assessments, if any, on the Agency Parcels, levied, assessed or imposed for any period commencing prior to conveyance of title to the Developer shall be borne by the Agency. I . [ §209] Environmental Matters 1. Definitions For the purposes of this Section 209, the following terms shall have the meanings herein specified: (a) The term "Hazardous Materials" shall mean (i) any "hazardous substance" as defined by the Comprehensive Environmental Response, Compensation and Liability Act of 1980 (42 U.S.C. Section 9601 et seg. ) , as amended from time to time, and regulations promulgated thereunder; (ii) any "hazardous substance" as defined by the Carpenter-Presley-Tanner Hazardous Substance Account Act (California Health and Safety Code Sections 25300 et s• eg. ) , as amended from time to time, and regulations promulgated thereunder; (iii) asbestos; (iv) polychlorinated biphenyls; (v) petroleum, oil, gasoline (refined and unrefined) and their respective byproducts and constituents; and (vi) any other substance, whether in the form of a solid, liquid, gas or any other form whatsoever, which by any "Governmental Requirements" (as defined in Subparagraph (c) of Paragraph 1 of this Section 209) either requires special handling in its use, transportation, generation, collection, storage, handling, treatment or disposal, or is defined as "hazardous" or harmful to the environment. (b) The term "Hazardous Materials Contamination" shall mean the contamination (whether presently existing or hereafter occurring) of the improvements, facilities, soil, groundwater, air or other elements on, in or of the Site by Hazardous Materials, or the contamination of the buildings, facilities, soil, groundwater, air or other elements on, in or of any other property as a result of Hazardous Materials at any time (whether before or after the date of this Agreement) emanating from the Site. (c) The term "Governmental Requirements" shall mean all laws, ordinances, statutes, codes, rules, regulations, orders and decrees of the United States, the state, the county, the city, or any other political subdivision in which the Site is located, and of any other political subdivision, agency or instrumentality exercising jurisdiction over the Agency, the Developer or the Site. 08/12/92 6449u/2460/009 -20- 2. Environmental Site Evaluation As soon as possible following the execution of this Agreement, the Developer and Agency shall cause the investigation of the environmental condition of their respective portions of the Site, at their respective cost and expense. Such investigation shall include such activities as the environmental consultant or expert retained to perform such investigation (the "Environmental Consultant") deems necessary or appropriate to determine the environmental condition of the Site, but in any case, including preparation of at least a Phase 1 report for the Site. If the Developer determines that testing beyond Phase I is necessary, such testing shall be the Developer' s expense. Both parties shall deliver to each other a copy of all reports and test results. Developer and Agency shall each bear any remedial cost associated with hazardous material contamination of or caused by as certified and proof provided by an engineers report acceptable to both parties of their respective parcels (the "Cleanup Costs") , which shall not exceed Two Hundred and Fifty Thousand Dollars ($250,000) respectively (the "Maximum Cleanup Cost" ) . Included in the Developer' s responsibilities are all such costs with respect to the Property Owners Parcels and the Cracchiola Parcel. For the Agency, the Maximum Cleanup Cost shall be comprised of an initial One Hundred Thousand Dollar ($100,000) amount (the "Nonrecoverable Amount" ) and a One Hundred and Fifty Thousand Dollar ($150,000) amount (the "Recoverable Amount" ) . If the Agency expends funds of the Recoverable Amount, said funds shall be reimbursed from gross profits prior to calculations of net profits pursuant to Section 201 herein. The Agency shall pay any necessary Cleanup Costs for the Sarrabere-Wood-Goodman Parcels as a separate obligation from the Maximum Cleanup Costs up to an amount equal to One Hundred Thousand Dollars ($100,000) . In the event that the cleanup costs on Sarrabere-Wood-Goodman Parcels exceed the One Hundred Thousand Dollar cap and are not offset on the condemnation evaluation of fair market value or the negotiated purchase price, said additional amount shall count toward the Agency' s Nonrecoverable, Recoverable and Maximum Cleanup Costs. 3. Right of Termination for Contamination The Developer and the Agency shall each have the right to terminate this Agreement if the Cleanup Costs for their respective parcels are expected to exceed the Maximum Cleanup Cost. Developer shall have the option to elect to pay Agency Cleanup Costs in excess of Two Hundred and Fifty Thousand Dollars ($250,000) . Termination of the Agreement pursuant to this provision (if after the conveyance of title) shall require the reconveyance of all of the Block 105 property to the Agency and a repayment of the Purchase Price to the 08/12/92 6449u/2460/009 -21- Developer. Additionally, the Developer and the Agency shall each document their costs and expenditures related to this Agreement for submission to an outside arbiter to be selected and approved by both parties. The arbiter shall verify claims of expense for both parties, with the purpose of allocating an equal share of costs between the parties. Within thirty (30) days of the arbiter' s conclusion, whichever party has expended the least in costs shall reimburse fifty percent (50%) of the additional costs expended by the other party. 4. Obligation of Developer to Remediate the Site Subject to the right of termination in Paragraph 3 above, after transfer of title pursuant to Section 204 and notwithstanding the obligation of Developer to indemnify Agency pursuant to Paragraph 4 of this Section 209 or any other obligations of the Developer pursuant to this Agreement, Developer shall, at its sole cost and expense, promptly take (i) all actions required by any federal, state or local governmental agency or political subdivision or any Governmental Requirements with respect to the entire Site, and (ii) all actions necessary to make full economic use of the Site for the purposes described in this Agreement, which actions, requirements or necessity arise from the presence upon, about or beneath the Site of any Hazardous Materials or Hazardous Materials Contamination regardless of when such Hazardous Materials or Hazardous Materials Contamination were introduced to the Site and regardless of who is responsible for introducing such Hazardous Materials or Hazardous Materials Contamination to the Site (the "Site Remediation") . The Site Remediation shall include, but not be limited to, investigation of the environmental condition of the Site, the preparation of any feasibility studies or reports and the performance of any cleanup, remedial, removal or restoration work required. The Developer shall take all actions necessary to promptly restore the Site to an environmentally sound condition for uses contemplated by this Agreement, notwithstanding any lesser standard of remediation allowable under applicable Governmental Requirements. Notwithstanding the above, in the event that the Agency has not already paid the Maximum Cleanup Costs prior to transfer of title pursuant to subparagraph 2 above, and in the event that additional contamination is discovered after the transfer that is attributable to the Agency Parcels or the Sarrabere-Wood-Goodman Parcels, then the Agency shall contribute any remaining funds up to the Maximum Cleanup Costs pursuant to the same terms and conditions set out in subparagraph 2 above. 5. Indemnification. Except as provided for termination in paragraph 3 above, after transfer of title pursuant to Section 204, Developer shall save, protect, defend, indemnify and hold 08/12/92 6449u/2460/009 -22- harmless Agency from and against any and all liabilities, suits, actions, claims, demands, penalties, damages (including, without limitation, penalties, fines and monetary sanctions) , losses, costs or expenses (including, without limitation, consultants' fees, investigation and laboratory fees, reasonable attorneys' fees and remedial and response costs) (the foregoing are hereinafter collectively referred to as "Liabilities") which may now or in the future be incurred or suffered by Agency by reason of, resulting from, in connection with or arising in any manner whatsoever as a direct or indirect result of (i ) the ownership of all or any part of the Site, (ii) any act or omission on the part of Developer, or their agents, employees, contractors or invitees, (iii) the presence on or under, or the escape, seepage, leakage, spillage, discharge, emission or release from the Site of any Hazardous Materials or Hazardous Materials Contamination, (iv) the environmental condition of the Site, and (v) any Liabilities incurred under any Governmental Requirements relating to Hazardous Materials. 6. Duty to Prevent Hazardous Material Contamination. The Developer shall take all necessary precautions to prevent the release of any Hazardous Materials into the environment. Such precautions shall include compliance with all Governmental Requirements with respect to Hazardous Materials. In addition, the Developer shall install and utilize such equipment and implement and adhere to such procedures as are consistent with the highest standards as respects the disclosure, storage, use, removal and disposal of Hazardous Materials. 7. Environmental Inquiries. The Developer shall notify the Agency, and provide to the Agency a copy or copies, of the following environmental permits, disclosures, applications, entitlements or inquiries relating to the Site: Notices of violation, notices to comply, citations, inquiries, cleanup or abatement orders, cease and desist orders, reports filed pursuant to self-reporting requirements and reports filed or applications made pursuant to any Governmental Requirement relating to Hazardous Materials and underground tanks, and the Developer shall report to the Agency, as soon as possible after each incident, any unusual, potentially important incidents, including but not limited to, the following: (a) All required reports of releases of Hazardous Materials, including notices of any release of Hazardous Materials as required by any Governmental Requirement; 08/12/92 6449u/2460/009 -23- (b) All fires; (c) All instances where asbestos has been or may be disturbed by repair work, tenant improvements or other activities in buildings containing asbestos; (d) All notices of suspension of any permits; (e) All notices of violation from Federal, State or local environmental authorities; (f) All orders under the State Hazardous Waste Control Act and the State Hazardous Substance Account Act and corresponding federal statutes, concerning investigation, compliance schedules, clean up, or other remedial actions; (g) All orders under the Porter-Cologne Act, including corrective action orders, cease and desist orders, and clean-up and abatement orders; (h) Any notices of violation from OSHA or Cal-OSHA concerning employees' exposure to Hazardous Materials; (i) All complaints and other pleadings filed against the Developer and/or the Agency relating to the Developer' s storage, use, transportation, handling or disposal of Hazardous Materials on the Site. In the event of a release of any Hazardous Materials into the environment, the Developer shall, as soon as possible after the release, furnish to the Agency a copy of any and all reports relating thereto and copies of all correspondence with governmental agencies relating to the release. Upon request of the Agency, the Developer shall furnish to the Agency a copy or copies of any and all other environmental entitlements or inquiries relating to or affecting the Site including, but not limited to, all permit applications, permits and reports including, without limitation, those reports and other matters which may be characterized as confidential. J. [ §210] Conditions Precedent to the Conveyance Notwithstanding any other provision of this Agreement to the contrary, Agency' s obligation to convey the Agency Parcels to Developer and the close of escrow shall, in addition to any other conditions set forth herein in favor of Agency, be conditional and contingent upon the satisfaction or waiver by Agency in its sole and absolute discretion, of each and all of the following conditions (collectively, the "Agency' s Conditions Precedent to the Conveyance" ) : 08/12/92 6449u/2460/009 -24- (i) Developer shall have obtained all of the development and building approvals required to initiate development of the Site in accordance with this Agreement; including, but not limited to, tentative tract maps, conditional use permits, and grading permits; (ii) Developer shall have provided the evidence of financing required in Section 202 of the Agreement acceptable to Agency; (iii) Developer shall have deposited into escrow all of the documents, fees, charges, costs, and items required to be deposited therein by Developer pursuant to this Agreement; (iv) Developer shall have submitted to Agency' s Executive Director evidence of liability insurance required pursuant to Section 308 of this Agreement; and (v) The estimated Cleanup Costs for the Agency Parcels shall not exceed the Maximum Cleanup Cost established in Section 202 of this Agreement; (vi) Developer shall not be in material default of this Agreement; (vii) Developer shall submit to Agency a contract for construction of the Project and a guaranty acceptable to the project lender or completion bond acceptable to the Agency' s Executive Director; (viii) Agency shall have completed acquisition and/or possession of the Sarrabere-Wood-Goodman Parcels. (ix) Developer and the Agency are satisfied with the conditional use permit conditions as required by the City. (x) Developer shall have demolished the existing commercial structures pursuant to the approved demolition plan on Block 104. In the event any of the Agency' s Conditions Precedent to the Conveyance are not satisfied or waived by Agency within the time periods provided herein and, with respect to any claimed default by Developer hereunder Developer has not cured said default within thirty (30) days after written notice from Agency, Agency may, at its option, terminate this Agreement and any escrow opened hereunder. In the event of such a termination, neither party shall have any further rights or obligations to the other under this Agreement with respect to the Site; provided, however, that nothing in this Section 210 08/12/92 6449u/2460/009 -25- is intended to limit or restrict Agency' s rights under Article VI herein in the event of a termination due to an uncured default by Developer. Notwithstanding any other provisions of this Agreement to the contrary, Developer' s obligation to accept conveyance of the Agency Parcels from Agency, and the close of escrow shall, in addition to any other conditions set forth herein in favor of Developer, be conditional and contingent upon the timely satisfaction, or waiver by Developer in its sole and absolute discretion, of each and all of the following conditions (collectively, the "Developer' s Conditions Precedent to the Conveyance" ) : (i) The Agency shall have acquired all of the individual parcels and property interests comprising the Sarrabere-Wood-Goodman Parcels (or the Agency shall have obtained an Order of Prejudgment Possession for any of such parcels or property interests for which fee title has not yet been obtained, with such Order meeting the requirements of Section 201 of this Agreement) ; (ii) The City shall have approved the vacation of the Alley on the Site which is to be vacated consistent with the Scope of Development (Attachment No. 3) ; (iii) Agency shall have timely deposited the Agency Parcel(s) Grant Deed (Attachment No. 6) into Escrow in the manner and condition and by the date provided in this Agreement; (iv) The Title Company shall have committed to issuing to Developer a title insurance policy to Agency Parcels and Sarrabere-Woad-Goodman Parcels complying with the requirements set forth in Section 207 herein; (v) Agency shall have deposited into escrow all of the documents, fees, charges, costs and items required to be deposited therein by Agency pursuant to this Agreement; (vi) Agency shall not be in material default of its obligations under this Agreement. (vii) Developer and Agency have satisfied the conditional use permit conditions as required by the City. In the event any of the Developer' s Conditions Precedent to the Conveyance are not satisfied or waived by Developer within the time periods provided herein and, with respect to any claimed default by Agency hereunder, Agency has not cured said default within thirty (30) days after written notice from Developer, Developer may, at its option, terminate 08/12/92 6449u/2460/009 -26- this Agreement and any escrow opened hereunder. In the event of such termination by Developer, neither party shall have any further rights or liabilities to the other under this Agreement with respect to the Site. K. [ §211] Land Use Entitlements The Developer as to the Developer Parcel and Agency as to the Agency Parcels shall be responsible and shall cooperate and assist in making appropriate application to the City of Huntington Beach to satisfy all provisions of the California Subdivision Map Act (Government Code Section 66410, et seg. ) and local enactments pursuant thereto as well as any other land use entitlements including, but not limited to, coastal development permit, conditional use permit and tentative and final tract map, that are applicable with respect to the development of the Site. III. [ §300] DEVELOPMENT OF THE SITE A. [ §301] Development of the Site by the Developer 1. [ §302] Scope of Development The Developer shall commence and complete construction of the improvements to be constructed by the Developer (the "Developer Improvements" ) according to the Scope of Development (Attachment No. 3) and consistent with approved entitlements and by the respective times established therefor in the Schedule of Performance (Attachment No. 4) . The working drawings for the Developer Improvements shall include any plans and specifications approved by the City and/or Agency, and shall incorporate or show compliance with all applicable conditions and environmental mitigation measures. 2. [ §303] Site Plan By the respective times set forth therefor in the Schedule of Performance (Attachment No. 4) , the Developer shall prepare and submit to the Agency for its approval Preliminary Design Drawings for the Project and site plan and related documents containing the overall plan for development of the Site in sufficient detail to enable the Agency to evaluate the proposal for conformity to the requirements of this Agreement. The Site shall be developed as established in this Agreement and such documents, except as changes may be mutually agreed upon between the Developer and the Agency. 08/12/92 6449u/2460/009 -27- 3 . [ §304] Construction Drawings and Related Documents By the time set forth therefor in the Schedule of Performance (Attachment No. 4) , the Developer shall prepare and submit to the City and the Agency for written approval construction drawings, parking plan, a landscape plan, and related documents for development of the Site. 4. [ §305] Cost of Construction The cost of developing the Site and constructing all improvements thereon shall be borne by the Developer with the exception of those costs to be borne by the Agency pursuant to this Agreement. S. [ §306] Construction Schedule The Developer shall promptly begin and thereafter diligently prosecute to completion the construction and the development of the Site within the times specified therefor in the Schedule of Performance (Attachment No. 4) . 6. [ §307] Anti-Discrimination During Construction The Developer, for himself and his successors and assigns, agrees that in the construction of the improvements provided for in this Agreement, the Developer will not discriminate against any employee or applicant for employment because of race, color, creed, religion, sex, marital status, handicap, national origin or ancestry. 7. [ §308] Bodily Injury and Property Damage Insurance The Developer shall defend, assume all responsibility for and hold the Agency, its officers and employees, harmless from, all claims or suits for, and damages to, property and injuries to persons, including accidental death (including attorneys fees and costs) , which may be caused by any of the Developer' s activities under this Agreement, whether such activities or performance thereof be by the Developer or anyone directly or indirectly employed or contracted with by the Developer and whether such damage shall accrue or be discovered before or after termination of this Agreement. Prior to the commencement of construction, the Developer shall take out and shall maintain in effect during the entire course of construction a comprehensive liability policy in the amount of Two Million Dollars ($2,000,000) combined single limit policy (part of which coverage may be provided by umbrella policies) , including contractual liability, as shall protect the Developer, City and Agency from claims for such damages. 08/12/92 6449u/2460/009 -28- The Developer shall furnish a certificate of insurance in form reasonably acceptable to the Agency countersigned by an authorized agent of the insurance carrier on a form of the insurance carrier setting forth the general provisions of the insurance coverage. This countersigned certificate shall name the City and the Agency and their respective officers, agents, and employees as additional insureds under the policy. The certificate by the insurance carrier shall contain a statement of obligation on the part of the carrier to notify City and the Agency of any material change, cancellation or termination of the coverage at least thirty (30) days in advance of the effective date of any such material change, cancellation or termination. Coverage provided hereunder by the Developer shall be primary insurance and not contributing with any insurance maintained by the Agency or City, and the policy shall contain such an endorsement. The insurance policy or the certificate of insurance shall contain a waiver of subrogation for the benefit of the City and the Agency. The required certificate shall be furnished by the Developer prior to the Agency Conveyance. The Developer shall also furnish or cause to be furnished to the Agency evidence satisfactory to the Agency that any contractor with whom it has contracted for the performance of work on the Site or otherwise pursuant to this Agreement carries workers' compensation insurance as required by law. The obligations set forth in this Section 308 shall remain in effect only until a final Certificate of Completion has been furnished for all of the Developer Improvements as hereafter provided in Section 309 of this Agreement. B. [ 6309] Certificate of Completion Promptly after the completion of all of the Developer Improvements in substantial conformity with this Agreement (as determined by the Executive Director of the Agency) and upon the written request of the Developer, the Agency shall furnish the Developer with a Certificate of Completion (Attachment No. 8) , which evidences and determines the satisfactory completion of such construction and carries forward those provisions and covenants specified in this Agreement, the Redevelopment Plan and the California Community Redevelopment Law. The issuance and recordation of the Certificate of Completion (Attachment No. 8) with respect to the Developer Improvements shall not supersede, cancel, amend or limit the continued efficacy of any obligations relating to the maintenance of the Site, use restrictions, payment of monies, 08/12/92 6449u/2460/009 -29- or any other obligations except for the obligation to complete construction of the Developer Improvements as of the time of the issuance of such certificate. If the Agency refuses or fails to furnish a Certificate of Completion (Attachment No. 8) with respect to the Site after written request from the Developer, the Agency shall, 'within forty-five (45) days of the written request, provide the Developer with a written statement of the reasons the Agency refused or failed to furnish such Certificate of Completion. Partial certificates of completion in substantially the form of "Attachment 8A" may be available at the sole and absolute discretion of the Executive Director. Upon issuance of a Certificate of Completion (Attachment No. 8) for the Developer Improvements, construction of such Developer Improvements shall be deemed to have been completed In conformity with this Agreement. The Certificate of Completion (Attachment No. 8) is not a notice of completion as referred to in Section 3093 of the California Civil Code. C. [ 5310j No Encumbrances Except Mart a es and Deeds of Trust Prior to the Agency' s issuance of the final Certificate of Completion for all of the Developer Improvements pursuant to Section 309 above, the Developer shall not encumber the Site or any portion thereof with any mortgage, deed of trust, or other conveyance for financing purposes without obtaining the Agency' s prior written approval. This Section 310 shall not apply and shall have no further force or effect after the issuance of the Final Certificate of Completion. The Agency shall not unreasonably withhold, delay, or condition approval of any conveyance for financing if the following conditions and requirements are met: 1. The conveyance for financing is to a responsible institutional lender with the capability of funding the loan in accordance with its terms; and 2. The proceeds of the loan are committed to the development of the Site (including without limitation all direct and indirect costs of the development, as well as site preparation, direct construction costs, title charges, leasing and sales commissions, interest expense and other financing costs, architectural, engineering, legal, and similar expenses, tenant improvements or tenant improvement allowances for tenants in the Commercial Portion of the Site, and the like) , 08/12/92 6449u/2460/009 -30- and/or the refinancing of any such loan (provided that the unpaid principal balance of any existing loan is not increased by virtue of any such refinancing) . 3. Agency agrees to subordinate to financing approved pursuant to this Section 310 to an amount equal to the actual Development Cost of the project as defined in the Equity Participation Share (Attachment No. 13) less the Developer' s fifteen percent (25%) of the equity. 4. Documentary substantiation of the estimates utilized to satisfy paragraphs 2 and 3 above are supplied to the Agency. Subject to the provisions of Section 310 of this Agreement, the Developer shall be entitled to record the mortgage or deed of trust securing any such approved financing prior to recordation of the Deed of Trust (Attachment No. 7) which secures the Purchase Price for the Agency Parcels. In addition, the Agency agrees to execute any document or documents that may be reasonably requested by the Developer to subordinate the Agency' s Deed of Trust (Attachment No. 7) to any additional financing or refinancing meeting the same requirements set forth above for the original loan. D. [ §311] Holder Not Obligated to Construct Improvements The holder of any mortgage or deed of trust authorized by this Agreement shall not be obligated by the provisions of this Agreement to construct or complete the improvements or to guarantee such construction or completion; nor shall any covenant or any other provision in the Agency Deed covering the Agency Parcel or, if applicable, the Sarrabere-Wood-Goodman Parcel conveyed by the Agency to the Developer be construed so to obligate such holder. Nothing in this Agreement shall be deemed to construe, permit or authorize any such holder to devote the Site to any uses or to construct any improvements thereon, other than those uses or improvements provided for or authorized by this Agreement. E. [ §312] Notice of Default to Mortgagee_orDeed of Trust Holders; Right to Cure With respect to any mortgage or deed of trust granted by Developer as provided herein, whenever the Agency shall deliver any notice or demand to Developer with respect to any breach or default by the Developer in completion of construction of the improvements, the Agency shall at the same time deliver to each holder of record of any mortgage or deed of trust authorized by this Agreement a copy of such notice or demand. Each such holder shall (insofar as the rights of the 08/12/92 6449u/2460/009 -31- Agency are concerned) have the right, at its option, within sixty (60) days after the receipt of the notice, to cure or remedy or commence to cure or remedy any such default and to add the cost thereof to the mortgage debt and the lien of its mortgage. Commencement of foreclosure or power of sale proceedings under any mortgage or deed of trust coupled with written notice of such holder' s intention to cure Developer' s default shall be deemed to be commencement of cure. Nothing contained in this Agreement shall be deemed to permit or authorize such holder to undertake or continue the construction or completion of the improvements (beyond the extent necessary to conserve or protect the improvements or construction already made) without first having expressly assumed the Developer' s obligations to the Agency by written assumption agreement reasonably satisfactory to the -Agency. The holder, in that event, must agree to complete, in the manner provided in this Agreement, the improvements to which the lien or title of such holder relates, and submit evidence satisfactory to the Agency that it has the qualifications and financial responsibility necessary to perform such obligations. Any such holder properly completing such improvement shall be entitled, upon compliance with the requirements of Section 312 of this Agreement, to a Certificate of Completion (as therein defined) . F. [ §313] Failure of Holder to Complete Improvements In any case where, sixty (60) days after receipt by a holder of notice of default by the Developer in completion of construction of improvements under this Agreement, the holder of any mortgage or deed of trust creating a lien or encumbrance upon the Site or any part thereof has not exercised the option to construct, or if it has exercised the option and has not proceeded diligently with construction, or to obtain title after institution of foreclosure or trustee' s sale proceedings, the Agency may purchase the mortgage or deed of trust by payment to the holder of the amount of the unpaid mortgage or deed of trust debt, including principal and interest and all other sums secured by the mortgage or deed of trust. If the ownership of the Site or any part thereof has vested in the holder, the Agency, if it so desires, shall be entitled to a conveyance from the holder to the Agency upon payment to the holder of an amount equal to the sum of the following: a. The unpaid mortgage or deed of trust debt at the time title became vested in the holder (less all appropriate credits, including those resulting from collection and application of rentals and other income received during foreclosure proceedings) ; b. All expenses with respect to foreclosure; 08/12/92 6449u/2460/009 -32- C. The net expense, if any (exclusive of general overhead) , incurred by the holder as a direct result of the subsequent management of the Site or part thereof; d. The costs of any improvements made by such holder; and e. An amount equivalent to the interest that would have accrued on the aggregate of such amounts had all such amounts become part of the mortgage or deed of trust debt and such debt had continued in existence to the date of payment by the Agency; less f. Any income derived by the lender from operations conducted on the Site (the receipt of principal and interest payments in the ordinary course of business shall not constitute income for the purposes of this subsection (f) ) . C. [ §314] Right of the Agency to Cure Mortgage or Deed of Trust Default In the event of a mortgage or deed of trust default or breach by the Developer prior to the completion of the construction of the improvements on the Site or any part thereof and the holder of any mortgage or deed of trust has not exercised its option to construct, the Agency may cure the default. In such event, the Agency shall be entitled to reimbursement from the Developer of all proper costs and expenses incurred by the Agency in curing such default. The Agency shall also be entitled to a lien upon the Site to the extent of such costs and disbursements. Any such lien shall be subject to the construction financing mortgages or deeds of trust. H. [ §315] Right of__the_Agency to Satisfy Other Liens on the Site After Title Passes After the conveyance of title and prior to the completion of construction, and after the Developer has had written notice and has failed after a reasonable time, but in any event not less than thirty (30) days, to challenge, cure, adequately bond against, or satisfy any liens or encumbrances on the Site which are not otherwise permitted under this Agreement, the Agency shall have the right but no obligation to satisfy any such liens or encumbrances; provided, however, that nothing in this Agreement shall require the Developer to pay or make provision for the payment of any tax, lien, assessment, or charge so long as the Developer shall in good faith contest the validity or amount thereof and so long as such delay in payment shall not subject the Site or a portion thereof to forfeiture or sale. 08/12/92 6449u/2460/009 -33- IV. [ §400] USE OF THE SITE A. [ §401] Uses The Developer covenants and agrees for itself, its successors, its assigns, and every successor in interest to the Site that the Developer, such successors and such assignees, shall not devote the Site to any uses other than the uses specified in or permitted by the Redevelopment Plan, the Covenants (Attachment No. 9) , and this Agreement (in conformity with the limitations of the Scope of Development (Attachment No, 3) , as the same may be amended from time to time in accordance with Developer' s rights under this Agreement and applicable law) for the periods of time specified therein. The foregoing covenant shall run with the land. The Project as described in the Scope of Development (Attachment No. 3) specifies commercial uses only on Block 104, however, nothing herein precludes the owners of Block 104 from applying to the City for the ability to convert to residential uses. Such a conversion would be at the sole discretion of the City. It is the Agency' s intent that there will be no interruption of business activity on Block 104 due solely to implementation of this Agreement until a conditional use permit for the Site is approved. The Developer covenants by and for itself and any successors in interest that there shall be no discrimination against or segregation of any person or group of persons on account of race, color, creed, religion, sex, marital status, handicap, national origin or ancestry in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the Site, nor shall the Developer itself or any person claiming under or through it establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees or vendees of the Site. The foregoing Covenants shall run with the land. The Developer shall refrain from restricting the rental, sale or lease of the Property or any portion of the Site on the basis of race, color, creed, religion, sex, marital status, handicap, national origin or ancestry of any person. All such deeds, leases or contracts shall contain or be subject to substantially the following nondiscrimination or nonsegregation clauses: 1. In deeds: "The grantee herein covenants by and for himself or herself, his or her heirs, executors, administrators and assigns, and all persons claiming under or through them, that there shall be no discrimination against or segregation of, any person or group of persons on 08/12/92 6449u/2460/009 -34- account of race, color, creed, religion, sex, marital status, national origin or ancestry in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the land herein conveyed, nor shall the grantee himself or herself or any person claiming under or through him or her, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees or vendees in the land herein conveyed. The foregoing covenants shall run with the land. " 2. In leases: "The lessee herein covenants by and for himself or herself, his or her heirs, executors, administrators and assigns, and all persons claiming under or through him or her, and this lease is made and accepted upon and subject to the following conditions: "There shall be no discrimination against or segregation of any person or group of persons on account of race, color, creed, religion, sex, marital status, ancestry or national origin in the leasing, subleasing, transferring, use, occupancy, tenure or enjoyment of the premises herein leased nor shall the lessee himself or herself, or any person claiming under or through him or her, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, sublessees, subtenants or vendees in the premises herein leased. " 3 . In contracts: "There shall be no discrimination against or segregation of, any person, or group of persons on account of race, color, creed, religion, sex, marital status, ancestry or national origin, in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the premises, nor shall the transferee himself or herself or any person claiming under or through him or her, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees or vendees of the premises. " 08/12/92 6449u/2460/009 -35- Except for covenants against discrimination or segregation, which shall continue in effect in perpetuity, the covenants set forth in this Section 401 shall terminate on January 1, 2017. B. [ §402] Maintenance of the Site The Developer shall maintain the Developer Improvements on the Site and shall keep the Site free from any accumulation of debris or waste materials. The Developer shall also maintain the landscaping required to be planted on the Site pursuant to the Scope of Development (Attachment No. 3) in a healthy condition. If, at any time, Developer fails to maintain said landscaping, and said condition is not corrected after expiration of thirty (30) days from the date of written notice from the Agency, either the Agency or the City may perform the necessary landscape maintenance and Developer shall pay such costs as are reasonably incurred for such maintenance. Issuance of a Certificate of Completion by the Agency shall not affect Developer's obligations under this section. The covenants set forth in this Section 402 shall terminate on January 1, 2017. C. 1 §4031 Rights of Access The Agency, for itself and for the City and other public agencies, at their sole risk and expense, reserves the right to enter onto the Site or any part thereof which is owned or controlled by the Developer, at all reasonable times for the purpose of construction, reconstruction, maintenance, repair or service of any public improvements or public facilities located within dedicated public easements on or adjacent to the Site. Any such entry shall be made only after reasonable notice to Developer. Agency shall repair any damage to the Site and restore the Site to its pre-existing condition. In addition, Agency shall indemnify, defend, and hold Developer harmless from any costs, claims, damages or liabilities pertaining to any entry. This Section 403 shall not be deemed to diminish any rights the Agency, the City, or any other public agencies may have without reference to this Section 403. D. ( §404] Effect of Violation of the Terms and Provisions of this Agreement After Completion of Construction The Agency is deemed the beneficiary of the terms and provisions of this Agreement and of the covenants running with the land, for and in its own rights and for the purposes of protecting the interests of the community and other parties, 08/12/92 6449u/2460/009 -36- public or private, in whose favor and for whose benefit this Agreement and the covenants running with the land have been provided. The Agreement and the covenants shall run in favor of the Agency, without regard to whether the Agency has been, remains or is an owner of any land or interest therein in the Site or in the Project Area. The Agency shall have the right, if the Agreement or covenants are breached, to exercise all rights and remedies, and to maintain any actions or suits at law or in equity or other proper proceedings to enforce the curing of such breaches to which it or any other beneficiaries of this Agreement and covenants may be entitled. V. [ §500] GENERAL PROVISIONS A. [ §501] Notices, Demands and Communications Between the Parties Written notices, demands and communications between the Agency and the Developer shall be sufficiently given if delivered by hand (and a receipt therefor is obtained or is refused to be given) or dispatched by registered or certified mail, postage prepaid, return receipt requested, to the principal offices of the Agency and the Developer which are set out in Sections 105 and 106 hereof. Such written notices, demands and communications may be sent in the same manner to such other addresses as either party may from time to time designate by mail as provided in this Section 501. A copy of written notices sent by either party shall be sent to the attention of: Barry Ross, Esq. 1 Newport Place Suite 900 Newport Beach, California 92660 Any written notice, demand or communication shall be deemed received immediately if delivered by hand or if delivered by registered or certified mail return receipt requested on the date received. B. [ §502] Conflicts of Interest No member, official or employee of the Agency shall have any personal interest, direct or indirect, in this Agreement, nor shall any member, official or employee participate in any decision relating to the Agreement which affects his personal interests or the interests of any corporation, partnership or association in which he is directly or indirectly interested. 08/12/92 6449u/2460/009 -37- The Developer warrants that it has not paid or given, and will not pay or give, any money or other consideration to any member, official, employee, or consultant of Agency for obtaining this Agreement. C. [ §503] Enforced Delay; Extension of Times of Performance In addition to specific provisions of this Agreement, performance by either party hereunder shall not be deemed to be in default, and all performance and other dates specified in this Agreement shall be extended, where delays or defaults are due to; war; insurrection; strikes; lockouts; riots; floods; earthquakes; fires; casualties; acts of God; acts of the public enemy; epidemics; quarantine restrictions; freight embargoes; lack of transportation; governmental restrictions or priority; litigation delays not the fault and beyond the reasonable control of the party claiming an extension of time to perform; unusually severe weather; acts or omissions of the other party; acts or failures to act of the City of Huntington Beach or any other public or governmental agency or entity (other than the acts or failures to act of the Agency which shall not excuse performance by the Agency) ; or any other causes beyond the control or without the fault of the party claiming an extension of time to perform. Notwithstanding anything to the contrary in this Agreement, an extension of time for any such cause shall be for the period of the enforced delay and shall commence to run from the time of the commencement of the cause, if notice by the party claiming such extension is sent to the other party within thirty (30) days of the commencement of the cause. Times of performance under this Agreement may also be extended in writing by the mutual agreement of the Developer and the Executive Director of the Agency. D. [ §504] Nonliability of Officials and Employees of the Agency No member, official or employee of the Agency shall be personally liable to the Developer, or any successor in interest, in the event of any default or breach by the Agency or for any amount which may become due to the Developer or its successors, or on any obligations under the terms of this Agreement. VI . [ §600] DEFAULTS AND REMEDIES A. [ §601] Defaults -- General Subject to the extensions of time set forth in Section 503, failure or delay by either party to perform any term or provision of this Agreement constitutes a default under this Agreement. The party who so fails or delays must 08/12/92 6449u/2460/009 -38- immediately commence to cure, correct, or remedy such failure or delay, and shall complete such cure, correction or remedy with diligence. The injured party shall give written notice of default to the party in default, specifying the default complained of by the injured party. Except as required to protect against further damages, the injured party may not institute proceedings against the party in default until thirty (30) days after giving such notice or, provided that the party is proceeding with diligence to cure, such greater time as may be necessary to cure given the nature of the default. Failure or delay in giving such notice shall not constitute a waiver of any default, nor shall it change the time of default. B. [ §602 ] Legal Actions 1. [ §603] Arbitration Subject to the restrictions in Section 601, the parties shall promptly submit any dispute, claim or controversy arising out of or relating to this Agreement (or any agreement contemplated by this Agreement) (including any action in tort, contract, or otherwise, at equity or at law) , or any alleged breach (including, without limitation, any matter with respect to the meaning, effort, validity, termination, interpretation, specific performance or enforcement of this Agreement or any agreement contemplated by this Agreement) to binding arbitration before one arbitrator ("Arbitrator" ) . The arbitration shall be held in Orange County, California, at the offices of Judicial Arbitration & Mediation Services, Inc. ("JAMS") , which offices are currently located at 500 North State College Boulevard, Suite 600, Orange, California 92668, in accordance with and under the then-current provisions of the Commercial Arbitration Rules of the American Arbitration Association and the following provisions: (a) Exclusive Remedy. The parties agree that binding arbitration shall be the sole means of resolving any disputes, claims, or controversies arising out of or relating to this Agreement (including any claim in tort or contract or otherwise, at equity or at law) , or any alleged breach (including, without limitation, with respect to the meaning, effect, validity, termination, interpretation, specific performance or enforcement of this Agreement or any agreement contemplated by this Agreement) . (b) Notice. Either party has the right to initiate arbitration. Arbitration shall be initiated upon one party' s notice to the other setting forth a demand for arbitration and detailing with specificity the nature of the dispute, claim or controversy to be arbitrated. 08/12/92 6449u/2460/009 -39- (c) Selection of Arbitrator. The parties may agree on a retired judge from the JAMS panel. If the parties are unable to so agree within thirty (30) days after the notice given under paragraph (b) above,' then JAMS will provide a list of three available judges and each party may strike one. The remaining judge will serve as the Arbitrator. The Arbitrator is empowered with the full authority of a judge sitting on the bench of the Superior Court in and for the State of California and may make any ruling consistent with that power. In order to implement this provision, the parties, by executing this Agreement, agree to execute and file with the Superior Court, such papers as are appropriate to procure the appointment of the Arbitrator as a Judge Pro-Tempore of the Superior Court. (d) Applicable Law. The Arbitrator shall follow any applicable federal and California state law (with respect to all matters of substantive law) in rendering an award. (e) Discovery. In any dispute arbitrated under this Agreement, the parties shall have the right to use any procedures for discovery provided for under the laws of the State of California (currently contained in the California Code of Civil Procedure) ; however, the Arbitrator shall have the right to disapprove or to limit any discovery that the Arbitrator determines to be for purposes of delay or otherwise unnecessarily burdensome or oppressive. (f) Evidence and Decision. The Arbitrator shall diligently pursue the matters being submitted for arbitration and shall render his decision within sixty (60) days after the selection of the Arbitrator is completed. The parties agree to make available to the Arbitrator all books, records, and other information in their possession or control relating to the matters being arbitrated and requested by the Arbitrator at such time as the Arbitrator may deem necessary to make his decisions required by this Agreement. Each party shall have access during normal business hours to such books, records, and other data as it may reasonably require to analyze the matters being submitted to arbitration under this Agreement and to prepare and to prove its contentions. The Arbitrator shall consider only evidence admissible under the California Evidence Code. (g) _Experts. The Arbitrator, at his discretion and at the expense of the party who will bear the cost of the arbitration, may employ an expert or experts (including, as examples, accountants and appraisers) to assist him in his determinations. (h) Advocacy. Prior to rendering his determination or award, the Arbitrator shall afford each party an opportunity to express its views as to the proper determination of the 08/12/92 6449u/2460/009 -40- f i jmatters under arbitration, orally or in writing as the Arbitrator may deem appropriate; provided, however, that (a) any party submitting written material shall be required to submit a copy of that material to the other party, who shall have the opportunity to submit a written reply to that material within ten (10) days, and (b) if either party is to submit oral statement, the other parties shall be afforded a reasonable opportunity to be present at the time at which these oral statements are made before the Arbitrator and to reply orally. (i) Arbitrability of Dispute. The arbitrability of any dispute, claim or controversy shall be determined by the Arbitrator. (j ) Judgment and Appeal. Judgment upon any award rendered by the Arbitrator may be entered in and enforced by any court having competent jurisdiction. The parties agree that all appellate rights to the decisions of the Arbitrator are preserved as if the decisions were rendered by a judge sitting on the bench of the Superior Court. (k) Damages. The Arbitrator shall have the power to make an award of actual compensatory damages as well as punitive damages. (1) Costs. The cost of the arbitration proceeding and any proceeding in court to confirm or to vacate any arbitration award, as applicable (including, without limitation, attorneys' fees and costs) , shall be borne by the unsuccessful party (or, at the discretion of the Arbitrator, may be prorated between the parties in such proportion as the Arbitrator determines to be equitable) and shall be awarded as part of the Arbitrator' s judgment. (m) Jurisdiction. The parties expressly consent to the jurisdiction of the courts (federal and state) in Orange County, California, to enforce any judgment of an Arbitrator and to render any provisional or injunctive relief in connection with or in aid of the arbitration. (n) Survival. This arbitration Section 603 shall survive termination of this Agreement. (o) Indemnification. The parties agree to indemnify the Arbitrator and any experts employed by the Arbitrator and to hold them unless from and against any claim or demand arising out of any arbitration under this Agreement unless resulting from the willful misconduct of the person indemnified. 08/12/92 6449u/2460/009 -41- 2. [ §604] Applicable Law The laws of the State of California shall govern the interpretation and enforcement of this Agreement. 3. [ §605] Acceptance of Service of Process In the event that any legal action is commenced by the Developer against the Agency, service of process on the Agency shall be made by personal service upon the Executive Director or in such other manner as may be provided by law. In the event that any legal action is commenced by the Agency against the Developer, service of process on the Developer shall be made by personal service and shall be valid whether made within or without the State of California or in such other manner as may be provided by law. C. [ §606] Rights and Remedies_Are Cumulative Except as otherwise expressly stated in this Agreement, the rights and remedies of the parties are cumulative, and the exercise by either party of one or more of such rights or remedies shall not preclude the exercise by it, at the same or different times, of any other rights or remedies for the same default or any other default by the other party. D. [ §607] Inaction Not a Waiver of Default Any failures or delays by either party in asserting any of its rights and remedies as to any default shall not operate as a waiver of any default or of any such rights or remedies, or deprive either such party of its right to institute and maintain any actions or proceedings which it may deem necessary to protect, assert or enforce any such rights or remedies. E. [ §608] Remedies and Rights of Termination 1. [ §6091 Damages. If either party defaults with regard to any of the provisions of this Agreement, the non-defaulting party shall serve written notice of such default upon the defaulting party. If a solely monetary default is not cured by the defaulting party within thirty (30) days after service of the notice of default (or within such other period as is set forth herein) , the defaulting party shall be liable to the other party for any damages caused by such default. For a default which includes a nonmonetary obligation, if the default is not cured by the defaulting party within thirty (30) days after service of the notice of default or, if the default is of such 08/12/92 6449u/2460/009 -42- a nature that it cannot reasonably be curred within said time, and the defaulting party does not commence to cure within said thirty (30) day period and diligently pursue such cure to completion, the defaulting party shall be liable to the other party for any damages caused by such default. Notwithstanding the above, this Section shall not be applicable if a termination by either party is invoked under Section(s) 611, 612 or 209(3) of this Agreement. 2. [ §610] Specific_Performance If either party defaults under any of the provisions of this Agreement, the non-defaulting party shall serve written notice of such default upon the defaulting party. If the default is not cured by the defaulting party within thirty (30) days of service of the notice of default or, if the default is of such a nature that it cannot reasonably be curred within said time, and the defaulting party does not commence to cure within said thirty (30) day period and diligently pursue such cure to completion, the non-defaulting party at its option may thereafter (but not before) commence an action for specific performance of the terms of this Agreement. Notwithstanding the above, this Section shall not be applicable if a termination by either party is invoked under Section(s) 611, 612 or 209(3) of this Agreement. 3. [ §611] Termination by the Developer In the event that: The Agency fails to timely perform those actions necessary to complete the Conveyance by the time set forth in the Schedule of Performance (Attachment No. 4) , and any such failure is not cured within thirty (30) days after the date of written demand by the Developer or, if the failure is of such a nature that it cannot reasonably be cured within said time, and the Agency does not commence to cure within said thirty (30) day period and diligently pursue such cure to completion, then this Agreement may, at the option of the Developer, be terminated by written notice thereof to the Agency (the "Notice of Termination") . Upon issuance and receipt of a valid Notice of Termination pursuant to this Section 611, the Agency and the Developer shall execute any documents deemed necessary by the Escrow Officer to close the Escrow and return all monies and documents on deposit to the party which initially deposited same. Thereafter, neither the Agency nor the Developer shall have any further rights against or liability to the other under the Agreement with respect to the Site. In the event of the Agency failure or default with respect to any event set forth in this Section 611, said right of termination provided in this Section 611 shall be Developer' s sole and exclusive remedy. 08/12/92 6449u/2460/009 -43- 4. ( §612] Termination-by the Agency In the event that: (a) The Developer (or any successor in interest) assigns the Agreement or any rights therein or in the Site in violation of this Agreement; or (b) The Developer fails to execute and deposit into escrow the Covenants (Attachment No. 9) by the times established therefor in the Schedule of Performance (Attachment No. 4) for the Conveyance; or (c) Any of the Agency' s Conditions Precedent to the Conveyance are not satisfied by the time established therefor in the Schedule of Performance (Attachment No. 4) ; then this Agreement and any rights of the Developer or any assignee or transferee in the Agreement, or arising therefrom with respect to the Agency or the Site, shall, at the option of the Agency, be terminated by the Agency. In the event of Developer' s failure or default under this Section 612 (a) - (c) above and any such failure is not cured or commenced to be cured within thirty (30) days after the date of written demand by the Agency; then this Agreement may, at the option of the Agency, be terminated by written notice thereof to the Developer. Upon issuance and receipt of a valid Termination Notice pursuant to this Section 612, the Agency and the Developer shall execute any documents deemed necessary by the Escrow Officer to cancel the Escrow and return all monies and documents on deposit to the party which initially deposited same. Thereafter, neither the Agency nor the Developer shall have any further rights against or liability to the other under the Agreement with respect to the Site. In the event of the Developer failure or default with respect to any event set forth in this Section 612, said right of termination provided in this Section 612 shall be Agency' s sole and exclusive remedy. 5. 1 §613] Termination Resulting in Completion of Block 104 In the event that the Agreement is terminated in such a manner that the residential improvements are never completed on Block 105 but the commercial improvements are completed, with an issuance of partial certificates of completion, on Block 104, Agency shall reimburse Developer for those verified, documented and budgeted costs expended for and relating solely to the Block 104 improvements to the extent such costs are not the obligation of the Property Owners. Such Block 104 budget 08/12/92 6449u/2460/009 -44- costs are limited to: sewer lateral, demolition, hazardous materials remediation and relocation (separate from Agency payments) not to exceed One Hundred Thousand Dollars ($100,000) prorated architectural, legal and engineering costs. VII . [ §700] SPECIAL PROVISIONS A. [ §701] Real Estate Commissions The Agency and the Developer each represent to the other party that it has not engaged the services of any finder or broker and that it is not liable for any real estate commissions, broker' s fees, or finder' s fees which may accrue by means of the acquisition of the Agency Parcels or the Sarrabere-Wood-Goodman Parcels, and agrees to hold harmless the other party from such commissions or fees as are alleged to be due from the party making such representations. B. [ §702 ] Successors In Interest The terms, covenants, conditions and restrictions of this Agreement shall extend to and shall be binding upon and inure to the benefit of the heirs, executors, administrators, successors and assigns of the Parties. Upon the termination of the restrictions imposed by Section 109 of this Agreement, which terminate upon the issuance by the Agency of a Certificate of Completion for the Project, all of the terms, covenants, conditions and restrictions of this Agreement which do not terminate upon the issuance by the Agency of the Certificate of Completion for the entire Site shall be deemed to be and shall constitute terms, covenants, conditions and restrictions running with the land. C. [ 6703 ] Amendments_ to this Agreement The Developer and the Agency agree to mutually consider reasonable requests for amendments to this Agreement provided said requests are consistent with this Agreement and would not substantially alter the basic business terms included herein. D. [ §704] Attorney Fees If either party to this Agreement is required to initiate or defend litigation in any way connected with this Agreement, the prevailing party in such litigation, in addition to any other relief which may be granted, whether legal or equitable, shall be entitled to reasonable attorney' s fees. Except as may be expressly provided elsewhere in this Agreement, if either party to this Agreement is required to initiate or defend 08/12/92 6449u/2460/009 -45- litigation with a third party because of the violation or alleged violation of any term or provision of this Agreement, or obligation of the other part to this Agreement, then the party so litigating shall be entitled to reasonable attorney' s fees from the other party to this Agreement. Attorney' s fees shall include attorney' s fees on any appeal, and in addition a party entitled to attorney' s fees shall be entitled to all other reasonable costs for investigating such action, taking depositions and discovery, and all other necessary costs incurred in such litigation. All such fees shall be deemed to have accrued on commencement of such action and shall be enforceable whether or not such action is prosecuted to judgment. E. [ §705] Release of Claims Each party (the Developer and the Agency) , on behalf of itself and its officers, partners, successors, assignees and representatives, fully releases and discharges the other party and its officers, employees, agents, successors and representatives from all and any manner of rights, demands, liabilities, obligations, claims, or cause of actions, in law or equity, of whatever kind or nature, whether known or unknown, whether now existing or hereinafter arising, which arise from or relate in any manner to the Site and the ownership, acquisition and development thereof, except for the obligations contained in this Agreement. Developer and the Agency have been advised by their respective attorneys and have read and understood the provisions of Section 1542 of the California Civil Code, which provides; "A general release does not extend to claims which the creditor does not know or suspect to exist in his favor at the time of executing the release, which if known by him must have materially affected his settlement with the debtor. " Nevertheless, Developer and Agency do hereby assume all risks for claims, known or unknown, heretofore or hereafter arising from or relating to the Site and the acquisition and development thereof, except for the obligations contained in this Agreement and to the matters released in this Section 705, and do hereby waive all of their respective rights under Section 1542 of the California Civil Code. This release shall survive the Conveyance and/or the termination of this Agreement. VIII . [ §800] ENTIRE AGREEMENT, WAIVERS This Agreement may be signed in counter-parts, each of which is deemed to be an original. This Agreement includes 08/12/92 6449u/2460/009 -46- pages 1 through _ and Attachments 1 through 13, which constitutes the entire understanding and agreement of the parties. This Agreement integrates all of the terms and conditions mentioned herein or incidental hereto, and supersedes all negotiations or previous agreements between the parties or their predecessors in interest With respect to all or any part of the subject matter hereof. All waivers of the provisions of this Agreement must be in writing signed by the appropriate authorities of the Agency and the Developer, and all amendments hereto must be in writing signed by the appropriate authorities of the Agency and the Developer. In any circumstance where under this Agreement either party is required to approve or disapprove any matter, approval shall not be unreasonably withheld, conditioned, or delayed. 08/12/92 6449u/2460/009 -47- IN WITNESS WHEREOF, the Agency and the Developer have signed this Agreement on the respective dates set forth below. 19 REDEVELOPMENT AGENCY OF THE CITY OF HUNTINGTON BEACH By: Chairman ATTEST: APPROVID AS TO FORKu G1IL HUTTON CITT ATTOP= Secretary �=&4''`4 Deputy City l�tto"'r APPROVED AS TO FORM: REVIEWED AND APPROVED: Stradlin Yocca Carlson & Rauth ��``—���"-j 8 g, Director of Economic Development Special Counsel to the Agency Agency Counsel COULTRUP COMPANIES, a California corporation AND BIRTCHER REAL ESTATE LIMITED, a California limited partnership By: Jon T. Coultrup, general partner By: Birtcher Real Estate Limited, general partner 08/12/92 6449u/2460/009 -48- STATE OF CALIFORNIA ) ss. COUNTY OF } On this day of 19 , before me, the undersigned, a Notary Public in and for said State, personally appeared , personally known to me (or proved to me on the basis of satisfactory evidence) to be the person who executed this instrument as the Chairman of the REDEVELOPMENT AGENCY OF THE CITY OF HUNTINGTON BEACH and acknowledged to me that said Agency executed it. WITNESS my hand and official seal. (SEAL) I 08/12/92 6449u/2460/009 this Deed of Trust) by any acts which may be unlawful or any violation of this Deed of Trust, (b) preserve or protect its interest (as described in this Deed of Trust) in the Security and in the rents, issues, profits and revenues arising therefrom, and (c) restrain the enforcement of or compliance with any legislation or other governmental enactment, rule or order that may be unconstitutional or otherwise invalid, if the enforcement for compliance with such enactment, rule or order would impair the security thereunder or be prejudicial to the interests of the Beneficiary. Section 7.9 Trustee May File Proofs of Claim. In the case of any receivership, insolvency, bankruptcy, reorganization, arrangement, adjustment, composition or other proceedings affecting the Trustor, its creditors or its property, the Beneficiary, to the extent permitted by law, shall be entitled to file such proofs of claim and other documents as may be necessary or advisable in order to have the claims of the Beneficiary allowed in such proceedings for the entire amount due and payable by the Trustor under this Deed of Trust at the date of the institution of such proceedings and for any additional amount which may become due and payable by the Trustor hereunder after such date. ARTICLE VIII MISCELLANEOUS Section 8.1 Amendments. This instrument cannot be waived, changed, discharged or terminated orally, but only by an instrument in writing signed by the party against whom enforcement of any waiver, change, discharge or termination is sought. Section 8.2 Trustor Waiver of Rights. Trustor hereby acknowledges that it is aware of and has the advice of counsel of its choice with respect to its rights under the Constitution of the United States, including, but not limited to, its rights arising under the Fourth, Fifth, Sixth and Fourteenth Amendments thereto, and the Constitution of the State of California. Trustor agrees that Beneficiary may exercise its rights hereunder in accordance with the provisions hereof, including, but not limited to, the exercise of the power of sale pursuant to Section 7.4 hereof, and Trustor hereby expressly waives and releases its rights under such Constitutions with respect thereto, including, but not limited to, its rights, if any, to notice and a hearing upon the occurrence of an Event of Default hereunder; provided, however, nothing contained herein shall be deemed to be a waiver of Trustor's rights to reinstate or redeem this Deed of Trust in accordance with applicable law. Trustor further waives to the extent permitted by law, (a) the benefit of all laws now existing or that may hereafter be enacted providing for any appraisement before sale of any portion of the Security, (b) all rights of valuation, appraisement, stay of execution, notice of election to mature or declare due the Whole of the secured indebtedness and marshaling in the event of foreclosure of the liens hereby created, and (c) all rights and remedies which Trustor may have or be able to assert by reason of the laws of the State of California pertaining to the rights and remedies of sureties. 08/12/92 ATTACHMENT NO. 7 6449u/2460/09 Page 12 of 14 Section 8.3 Reconveyance by Trustee. Upon written request of Beneficiary stating that all sums secured hereby have been paid and that all performance obligations secured hereby have been performed to Agency's satisfaction, and upon surrender of this Deed of Trust to Trustee for cancellation and retention, and upon payment by Trustor of Trustee's reasonable fees, Trustee shall reconvey to Trustor, or to the person or persons legally entitled thereto, without warranty, any portion of the Property then held hereunder. The recitals in such reconveyance of any matters or facts shall be conclusive proof of the truthfulness thereof. The grantee in any reconveyance may be described as "the person or person legally entitled thereto." Partial Reconveyances, in a form substantially the same as Attachment No. 7-A attached hereto and incorporated herein, may be approved in accordance with sales of individual, residential units, pursuant to terms set out in the Equity Participation Procedure (Attachment No. 13) . Section 8.4 Notices. Whenever Beneficiary, Trustor or Trustee shall desire to give or serve any notice, demand, request or other communication with respect to this Deed of Trust, each such notice, demand, request, or other communication shall be in writing and shall be effective only if the same is delivered by personal service or mailed by registered or certified mail, postage prepaid, return receipts requested, or by telegram, addressed to the address set forth in the first paragraph of this Deed of Trust. Any party may at any time change its address for such notices by delivering or mailing to the other parties hereto, as aforesaid, a notice of such change. Section 8.5 Acceptance by Trustee. Trustee accepts this Trust when this Deed of Trust, duly executed and acknowledged, is made a public record as provided by law. Section 8.6 Captions. The captions or headings at the beginning of each Section hereof are for the convenience of the parties and are not a part of this Deed of Trust. Section 8.7 Invalidity of Certain Provisions. Every provision of this Deed of Trust is intended to be severable. In the event any term or provision hereof is declared to be illegal or invalid for any reason whatsoever by a court of competent jurisdiction, such illegality or invalidity shall not affect the balance of the terms and provisions hereof, which terms and provisions shall remain binding and enforceable. If the lien of this Deed of Trust is invalid or unenforceable as to any part of the debt, or if the lien is invalid or unenforceable as to any part of the Security, the unsecured or partially secured portion of the debt, and all payments made on the debt, whether voluntary or under foreclosure or other enforcement action or procedure, shall be considered to have been first paid on and applied to the full payment of that portion of the debt which is not secured or partially secured by the lien of this Deed of Trust. Section 8.8 No Merger. If title to the Property shall become vested in the Beneficiary, this Deed of Trust and the lien created hereby shall not be destroyed or terminated by application of the doctrine of merger and, in such event, Beneficiary shall continue to have and enjoy all of the rights and privileges of Beneficiary under this Deed of Trust. in addition, upon foreclosure under this Deed of Trust pursuant to the provisions hereof, any 08/12/92 ATTACHMENT NO. 7 6449u/2460/09 Page 13 of 14 leases or subleases then existing and affecting all or any portion of the Security shall not be destroyed or terminated by application of the law of merger or as a matter of law or as a result of such foreclosure unless Beneficiary or any purchaser at any such foreclosure shall so elect. No act by or on behalf of Beneficiary or any such purchaser shall constitute a termination of any lease or sublease unless Beneficiary or such purchaser shall give written notice of termination to such tenant or subtenant. Section 8.9 Governing Law. This Deed of Trust shall be governed by and construed in accordance with the laws of the State of California. Section 8.10 Gender and Number. In this Deed of Trust the singular shall include the plural and the masculine shall include the feminine and neuter and vice versa, if the context so requires. IN WITNESS WHEREOF, Trustor has executed this Deed of Trust as of the day and year first above written. COULTRUP COMPANIES, a California corporation AND BIRTCHER REAL ESTATE LIMITED By: Its: By: Its: 08/12/92 ATTACHMENT NO. 7 6449u/2460/09 Page 14 of 14 STATE OF CALIFORNIA } } ss. COUNTY OF ) On 199 before me, the undersigned, a Notary Public in and for said State, personally appeared , personally known to me or proved to me on the basis of satisfactory evidence to be the person whose name is subscribed to the within instrument and acknowledged that executed the same. WITNESS my hand and official seal. (SEAL) STATE OF CALIFORNIA ) } ss. COUNTY OF } On 199 before me, the undersigned, a Notary Public in and for said State, personally appeared , personally known to me or proved to me on the basis of satisfactory evidence to be the person whose name is subscribed to the within instrument and acknowledged that executed the same. WITNESS my hand and official seal. (SEAL) 08/12/92 6808u/2012/95 ATTACHMENT NO. 7 EXHIBIT A LEGAL DESCRIPTION OF THE SITE 08/12/92 6449u/2460/09 EXHIBIT A to ATTACHMENT NO. 7 ATTACHMENT NO. 8 RECORDING REQUESTED BY ) AND WHEN RECORDED MAIL TO: } } } } } } [Space above for recorder. ] CERTIFICATE OF COMPLETION FOR CONSTRUCTION AND DEVELOPMENT WHEREAS, by Grant Deed dated and recorded on as No. of the official records of the County Recorder of the County of Orange, California (the "Grant Deed" ) , the REDEVELOPMENT AGENCY OF THE CITY OF HUNTINGTON BEACH, a public body corporate and politic, hereinafter referred to as "Agency", conveyed to COULTRUP COMPANIES and BIRTCHER REAL ESTATE LIMITED, hereinafter referred to as the "Developer", title to certain real property situated in the City of Huntington Beach, California which property was assembled with property of the Developer (collectively the "Site" ) as described on Exhibit "A" attached hereto and made a part hereof; and WHEREAS, pursuant to a Disposition and Development Agreement by and between the Agency and the Developer dated as of , a copy of which is on file with the Agency as a public record at its offices at City Hall, 2000 Main Street, Huntington Beach, California (the "DDA" ) , and is incorporated herein by reference the Developer and the Agency carried out the development of the Site; and WHEREAS, as referenced in said Grant Deed, the Agency shall furnish the Developer with a Certificate of Completion upon completion of construction, which certificate shall be in such form as to permit it to be recorded in the Recorder' s Office of Orange County; and 08/12/92 ATTACHMENT NO. 8 6449u/2460/09 Page 1 of 2 WHEREAS, such certificate shall be conclusive determination of satisfactory completion of the construction of the Developer Improvements required by the DDA and the Grant Deed; and WHEREAS, the Agency has conclusively determined that the construction of the Developer Improvements on the above described real property required by the DDA and the Grant Deed has been satisfactorily completed. NOW THEREFORE, 1. As provided in the DDA, the Agency does hereby certify that the construction of the Developer Improvements has been fully and satisfactorily performed and completed. 2. Nothing contained in this instrument shall modify in any other way any other provisions of the Grant Deed or the DDA. IN WITNESS WHEREOF, the Agency has executed this certificate this day of , 19_ REDEVELOPMENT AGENCY OF THE CITY OF HUNTINGTON BEACH, a public body corporate and politic By: ATTEST: 08/12/92 ATTACHMENT NO. 8 6449u/2460/09 Page 2 of 2 EXHIBIT "A" LEGAL DESCRIPTION OF THE PROPERTY 08/12/92 EXHIBIT A to ATTACHMENT NO. 8 6449u/2460/09 Page 1 of 1 ATTACHMENT NO. 8-A RECORDING REQUESTED BY ) AND WHEN RECORDED MAIL TO: ) ) ) ) ) [Space above for Recorder. ) This document is exempt from the payment of a recording fee pursuant to Government Code Section 6103 . REDEVELOPMENT AGENCY OF THE CITY OF HUNTINGTON BEACH By: Its: Dated: 19_ PARTIAL CERTIFICATE OF COMPLETION THIS PARTIAL CERTIFICATE OF COMPLETION (the "Certificate") is made by the REDEVELOPMENT AGENCY OF THE CITY OF HUNTINGTON BEACH, a public body corporate and politic (the "Agency") in favor of the , a California partnership (the "Developer" ) , as of the date set forth below. RECITALS A. The Agency and the Developer have entered into that certain Disposition and Development Agreement ("DDA") dated , 1992 concerning the development of certain real property situated in the City of Huntington Beach, California. Pursuant to the DDA, the Agency has conveyed certain real property to the Developer for development purposes (the "Parcel") . B. As referenced in Section of the DDA, the Agency may furnish the Developer or its successors with a Partial 08/12/92 ATTACHMENT NO. 8-A 6449u/2460/09 Page 1 of 5 Certificate of Completion at the sole discretion of the Agency Executive Director, which certificate shall be in such form as to permit it to be recorded in the official records of Orange County. This Partial Certificate of Completion is required to be conclusive determination of satisfactory completion of the construction and development required by the DDA only as to the individual parcel or unit which is described in Exhibit "A" attached hereto and incorporated herein by reference (the "Completed Parcel or Unit" ) . C. The Agency has conclusively determined that such construction and development as to the Completed Parcel or Unit has been satisfactorily completed. NOW, THEREFORE, the Agency hereby certifies as follows: 1. The Improvements to be constructed by the Developer on the Completed Parcel or Unit have been fully and satisfactorily completed in conformance with the DDA. This Certificate is not a determination by the Agency of the completion of construction or development of any other Improvements to be constructed on the Parcel, other than the Completed Parcel or Unit, which have been or will be conveyed from the Agency to the Developer pursuant to the DDA. Any use, operation, or maintenance requirements of the DDA shall remain enforceable according to their terms. 2. Except as provided herein, nothing contained in this instrument shall modify in any other way any other provisions of the DDA. 3. This Partial Certificate of Completion shall not constitute evidence of compliance with or satisfaction of any obligation of the Developer to any holder of any mortgage, or any insurer of a mortgage loaned to finance the Improvements, or any part thereof. 4. This Partial Certificate of Completion is not a notice of completion as referred to in California Civil Code Section 3093. IN WITNESS WHEREOF, the Agency has executed this certificate this day of 19_ REDEVELOPMENT AGENCY OF THE CITY OF HUNTINGTON BEACH, a public body corporate and politic By: Its: 08/12/92 ATTACHMENT NO. 8-A 6449u/2460/09 Page 2 of 5 ATTEST: Agency Secretary APPROVED AS TO FORM: Stradling, Yocca, Carlson & Rauth, Agency Special Counsel 08/12/92 ATTACHMENT NO. 8-A 6449u/2460/09 Page 3 of 5 EXHIBIT "A" LEGAL DESCRIPTION [To Be Inserted] 08/12/92 ATTACHMENT NO. 8-A 6449u/2460/09 Page 4 of 5 STATE OF CALIFORNIA ) ) ss. COUNTY OF ORANGE } On this day of , 19 , before me, the undersigned, a Notary Public in and for said State, personally appeared , personally known to me (or proved to me on the basis of •satisfactory evidence) to be the person who executed this instrument as the of the REDEVELOPMENT AGENCY OF THE CITY OF HUNTINGTON BEACH, a public body corporate and politic, and acknowledged to me that said Agency executed it. WITNESS my hand and official seal. (SEAL) O8/12/92 ATTACHMENT NO. S-A 6449u/2460/09 Page 5 of 5 3 STATE OF CALIFORNIA ) ss. COUNTY OF } On this day of , 19_, before me, the undersigned, a Notary Public in and for said State, personally appeared personally known to me or proved to me on the basis of satisfactory evidence to be the person who executed the within instrument as one of the general partners of COULTRUP COMPANIES, a California corporation AND BIRTCHER REAL ESTATE LIMITED, a California limited partnership, the partnership that executed the within instrument, and that said partnership executed the same. WITNESS my hand and official seal. (SEAL) STATE OF CALIFORNIA ) ss. COUNTY OF ) On this day of 19_, before me, the undersigned, a Notary Public in and for said State, personally appeared personally known to me or proved to me on the basis of satisfactory evidence to be the person who executed the within instrument as one of the general partners of COULTRUP COMPANIES, a California corporation AND BIRTCHER REAL ESTATE LIMITED, a California limited partnership, the partnership that executed the within instrument, and that said partnership executed the same. WITNESS my hand and official seal. (SEAL) 08/12/92 6449u/2460/009 ATTACHMENT NO. 1 SITE MAP [To Be Attached] 08/12/92 ATTACHMENT NO. 1 6449u/2460/009 ATTACHMENT NO. 1-A PROPOSED SITE MAP [To Be Attached] 08/12/92 ATTACHMENT NO. 1-A 6449u/2460/009 ATTACHMENT NO. 2 LEGAL DESCRIPTION BLOCK 104: AGENCY PARKING PARCEL AGENCY EXCHANGE PARCEL PROPERTY OWNERS PARCELS BLOCK 105: SARRABERE-WOOD-GOODMAN PARCELS BLOCK 105 AGENCY PARCELS BAGSTAD PARCEL 08/12/92 ATTACHMENT NO. 2 6449u/2460/009 ATTACHMENT NO. 3 SCOPE OF DEVELOPMENT The purpose of this Attachment is to identify the scope of work to be performed by Developer and Agency and what guidelines are appropriate to utilize in the design and development of the Project. I . ARCHITECTURE & DESIGN A. To the extent possible, and respecting the separate ownership of the parcels on Block 104, each separate block (Blocks 104 and 105) within the Site shall be designed and developed as an integrated complex. 1. The Developer Improvements shall be of high architectural quality, well landscaped, and effectively and aesthetically designed. 2. The shape, scale of volume, exterior design, and exterior finish of each building, structure, and other improvement must be consonant with, visually related to each other and, to the extent reasonably practical, to adjacent improvements existing or planned within the Project Area. 3. The open spaces between buildings shall be designed, landscaped and developed to the same degree of excellence. B. The total development shall be in conformance with the Amended Redevelopment Plan for the Main-Pier Redevelopment Project Area and subject to Agency review. II. DEVELOPER' S RESPONSIBILITIES A. Generally. All cost, expenses and indebtedness related to the assemblage, disposition and development of the Site per the Agreement shall be borne exclusively by Developer except as otherwise stated in the Agreement. B. Consistency With Approvals. The Project shall be consistent with all City approvals, including the final tract maps, the final building plans, this Agreement and as the same may be amended from time to time. 08/12/92 ATTACHMENT NO. 3 6449u/2460/009 Page 1 of 6 C. The Project. The Project consists of the following: 1. Residential Portion: (Block 105) a. Approximately 80 residential condominium units in a 3 to 4 story building including one story of parking. b. Parking, at a minimum sufficient to provide 2 stalls per residential unit and/or to provide the code minimum per dwelling unit, exclusive of guest parking, on site. C. Amenities include a swimming pool, Jacuzzi, clubhouse/recreation room, security gates and two or more elevators. d. An on-site sales office. e. Construction materials shall be equal quality or better than the Town Square Project located at Main, Orange and 6th Streets. 2. Commercial Portion: (Block 104) a. Approximately 47,500 square feet of commercial buildings comprised of retail spaces, office spaces or other commercial uses. b. Parking as required by the City for the Commercial Portion shall be provided by Agency with credit for grandfathered spaces accrued to existing parcels, including: (1) Existing parking lot(s) or lots and structures to be designed and constructed at Agency or City expense, and (2) Offsite and onstreet parking around the perimeter of Block 104. D. Contractor. Developer shall select, oversee and coordinate one or more general contractors and relevant subcontractors for all of the work proposed herein. E. Signs. Signs shall conform to all City codes. Additionally, Developer shall submit a planned sign 08/12/92 ATTACHMENT NO. 3 6449u/2460/009 Page 2 of 6 program for any external signs on both the Residential and the Commercial Portions of the Project. F. Screening. Outdoor storage and equipment, including rooftop installations, shall be installed per City codes and screened from street-level public view. G. Landscaping. Developer is to provide and maintain all landscaping on the Site, including within public rights of way within the Site and setback areas, in accordance with approved landscape plans. H. Utilities. Utilities shall be installed in accordance with all City codes. Utilities are identified as including, but not necessarily limited to the following (hereafter "Utilities") . a. Gas service (Southern California Gas Company) b. Electric service (Southern California Edison) C. Cable television (Paragon Cable) d. Sanitary sewer e. Storm drain/water runoff/catch-basin systems f. Water service (City Water Department) (1) Domestic water (2) Gray water (3) Fire hydrants and other water connections for use by and for the First Department and/or any fire control systems including connection to on-site sprinkler systems. g. The Utilities shall be installed in accordance with the City' s Municipal Codes. Developer will install/extend all utilities from the net lot area property lines of the Developer Parcels, Agency Parcels and Sarrabere-Wood-Goodman Parcels (the "Property Line" ) inwards to and into the improvements on the Site. The location of the Utilities at/on the Property Line (the "Connection Points") shall be determined by mutual consent between Agency and Developer and their relevant engineering services and consultants and shall be in accordance with the best economical practices of the building industry. 08/12/92 ATTACHMENT NO. 3 6449u/2460/009 Page 3 of 6 I . Vehicular Access. The number and location of vehicular driveways and curb-breaks shall be in accordance with the approved plans. J. Offsite_ Improyements for Block 105. 1. Developer shall, at his expense, engineer and install the sidewalks, curbs and gutters, subsurface paving and finish paving between the Property Line of Block 105 up to but not necessarily limited to the centerline of the streets surrounding Block 105 except that portion of the perimeter of Block 105 adjacent to the Worthy Property, which shall be paid for by Agency. 2. As required by City plan approvals, Developer shall install, reroute or cause to be rerouted, relocated, undergrounded and/or otherwise rebuild, all necessary Utility services, as described in II .H. above, and/or other designated improvements in the public right of way as are required for City approval of plans within the public right of ways between the Property Line and the centerline of the adjoining streets bounding Block 105, from their present locations and/or configurations, for the development, use and maintenance of the improvements on the Block 105 portion of the Site. 3. Developer shall install or relocate any streetlights, street signs, traffic signs, parking meters, traffic signals, traffic controls or any such utility service work commonly associated with such installation if required by City. 4. Developer and its engineers and contractors shall coordinate with Caltrans relating to any improvements and/or offsite work on Pacific Coast Highway ("PCH" ) . III . AGENCY RESPONSIBILITIES A. General. The Agency shall be responsible for payment of and expenses related to the development of Block 104 of the Site as enumerated in this Section III(c) . 08/12/92 ATTACHMENT NO. 3 6449u/2460/009 Page 4 of 6 B. Indemnification and Hold Harmless. Agency shall indemnify and hold Developer harmless from all claims or suits for, and damages to, property and injuries to persons, including accidental death (including attorney' s fees and costs) , which may be caused solely by the active negligence of Agency' s or employees' or agents' activities under Section III of this Scope of Development unless the Developer acts as contractor for Agency, in which event the Developer shall defend and hold harmless the Agency. C. Related Consultants. Agency shall be responsible for direct payment for all consultant architectural, civil engineering, and other services required for the plans and specifications and related .job-site supervision for the work identified hereafter. This shall include all field engineering services, including surveying, required to implement said plans and specifications, including, but not limited to soils and geological tests and studies and monitoring, civil engineering services, consultations and visits. Such work shall also include surveying for utility services and locations, street lines and elevations, soil tests, materials testing and all specific services requested and/or necessitated by City inspector requests and public works inspectors and/or public works engineer requests and/or City public works directives and changes. Field services also include work performed due to any unplanned and/or emergency situations as they arise. 1. No consulting engineering services or contractor or subcontractor in the employ of Developer shall be required to perform any offsite work and/or emergency repair or other work without a written work authorization from a City inspector or City engineer or duly authorized City official. 2. In the event of an emergency which threatens the public Improvements on the Site and/or is clearly hazardous to public welfare in which a written work authorization is not immediately available, and Developer and/or his contractor(s) are present and capable of performing, Developer with notice to City Public Works Department shall at his discretion proceed to abate such emergency as is needed to preserve the Improvements and/or remove or abate such public hazard. The Agency and/or the City shall reimburse Developer any and all costs associated with such emergency and/or hazard abatement or removal, to the extent not 08/12/92 ATTACHMENT NO. 3 6449u/2460/009 Page 5 of 6 otherwise a Developer cost under this Agreement. Developer shall be covered by the indemnification and hold harmless provisions set forth above for any such work. C. Offsites and Public Improvements. All offsite and on-site public improvements to and around Block 104 up to, but not necessarily limited to within the centerline of the streets adjacent and bounding Block 104, including the following: 1. Relocation of the Alley (as identified in the Proposed Site Map to this Agreement) and related easement work to maintain Utility services to the Connection Points on Block 104. 2. Construction of a parking lot in the area shown on the Site Map. 3. Construction of any Utility services and/or relocation and/or undergrounding thereof for other parcels within Block 104 which are not part of the scope of work identified herein (Lane and Abdelmuti properties) . 4. Street, sidewalk, curb and gutter surrounding Block 104. D. Utilities. For use by the improvements on Block 104, the Agency shall install, reroute or cause to be rerouted, relocated, undergrounded and/or otherwise rebuild, all necessary Utility Services, as described in II .H. , above, within the public right of ways as is needed, from their present locations and/or configurations, for the development, use and maintenance of the improvements on the Site. Said installations, rerouting, relocation, undergrounding and/or rebuilding shall be to the Property Line. E. Easements and Permits. Agency agrees to assist Developer as necessary and/or requested by Developer, with the filing and processing of required applications and permit processing to effectuate easements and permits necessary to the development of the Site and the Improvements thereon. 08/12/92 ATTACHMENT NO. 3 6449u/2460/009 Page 6 of 6 ATTACHMENT NO. 4 SCHEDULE OF PERFORMANCE I . GENERAL PROVISIONS 1. Execution of Agreement Not later than forty-five by the Agency. The Agency (45) days after the date shall approve and execute of execution and submission this Agreement, and shall of three (3) copies of deliver one (1) copy this Agreement by the thereof to the Developer. Developer and the Property Owners have executed their individual covenants, conditions and restrictions. 2. Evidence of Financing Not later than one hundred and Insurance Certificates. and twenty (120) days after Developer shall submit the execution of the evidence of financing and Agreement by the Agency. Insurance Certificates. 3. Developer Becomes Managing Not later than one hundred General Partner. The and twenty (120) days after Developer shall become a the execution of the partnership between Coultrup Agreement by the Agency. Companies and a new Birtcher entity and that partnership shall become the managing general partner of the Property Owners Partnership. II. ENTITLEMENT AND MAP APPLICATION CONSTRUCTION DOCUMENTS AND BUILDING PERMITS WITH RESPECT TO THE SITE 4. Developer and Agency Within ninety (90) days A22lication for Discretionar after Agency approval of Permits for Project. The this Agreement. Developer and Agency shall apply for the conditional use permit, tentative tract map, and coastal development permit required for the construction of the Developer Improvements. S. Submittal of Construction Not later than one hundred Drawings. The Developer twenty (120) days after shall submit to the City approval of discretionary complete construction draw- entitlements. ings for all of the Developer Improvements. 08/12/92 ATTACHMENT NO. 4 6449u/2460/009 Page 1 of 3 6. Review of Complete Within forty-five (45) days Drawings. The City and after submittal by its Building Official shall Developer. review the construction drawings submitted by the Developer. 7. Final Review of Complete Within twenty (20) days Drawings. The City and after resubmittal by the its Building Official shall Developer. review the construction drawings (revisions) sub- mitted by the Developer. S. Obtaining of Building Permits. Not later than twenty (20) Developer shall obtain all days after approval of building and other permits construction plans. needed to commence construction of the Developer Improvements. 9. Recording Property Owners Not later than ten (10) CC&Rs. Agency shall record days from issuance of Property Owner CC&Rs. building permits. III . ACQUISITION OF SARRABERE-WOOD-GOODMAN PARCELS. 10. Agency shall obtain Not later than eighteen (18) possession of Sarrabere-Woad- months from date of Goodman Parcels. execution of this Agreement. IV. ESCROW 11. Openin2 of Escrows. Agency Within twenty (20) days and Developer open escrows after approval of for the conveyance of the construction plans. Agency Parcels and the Sarrabere-Wood-Goodman Parcels. 12. Close of Escrow. Escrow Within ten (10) days closes. after the satisfaction (or waiver by the appropriate party) of all of the Conditions Precedent to Conveyance. 08/12/92 ATTACHMENT NO. 4 6449u/2460/009 Page 2 of 3 V. CONSTRUCTION PHASE 13. Commencement of Construction. Not later than thirty Developer shall commence (30) days after construction of the issuance of building Developer Improvements. permits. For Block 104 no later than one hundred and twenty (120) days after execution of the Agreement by the Agency. 14. Completion of Construction. Not later than eighteen Developer shall complete (18) months after construction of all of the the close of Escrow or the Developer Improvements. transfer of por.session under an order of prejudgment posse3sion but in no event later than thirty-six (36) it,c,-nt is frcm the date of execution of this Agreement. 08/12/92 ATTACHMENT NO. 4 6449u/2460/009 Page 3 of 3 ATTACHMENT NO. 5 [TO BE SUPPLIED] 08/12/92 ATTACHMENT NO. 5 6449u/2460/09 Page 1 of 1 ATTACHMENT NO. 6 RECORDING REQUESTED BY: ) AND WHEN RECORDED MAIL TO: } } } ) } } The undersigned Grantor declares: Documentary transfer tax is S REDEVELOPMENT AGENCY OF THE CITY OF HUNTINGTON BEACH By: Its: Dated: 19 BLOCK 105 AGENCY PARCELS GRANT DEED For valuable consideration, receipt of which is hereby acknowledged, the REDEVELOPMENT AGENCY OF THE CITY OF HUNTINGTON BEACH, a public body, corporate and politic, of the State of California, herein called "Grantor" acting to carry out the Redevelopment Plan, herein called "Redevelopment Plan" for the Main Pier Redevelopment Project, herein called "Project", under the Community Redevelopment Law of California, hereby grants to COULTRUP COMPANIES, a California corporation AND BIRTCHER REAL ESTATE LIMITED, herein called "Grantee," the real property hereinafter referred to as the "Property", described in Exhibit A attached hereto and incorporated herein, subject to the existing easements, restrictions and covenants or record described there. 1. Grantor excepts and reserves from the conveyance herein described all interest of the Grantor in oil, gas, hydrocarbon substances and minerals of every kind and character lying more than 500 feet below the surface, together with the right to drill into, through, and to use and occupy all parts of the Property lying more than 500 feet below the surface thereof for any and all purposes incidental to the exploration for and production of oil, gas, hydrocarbon substances or minerals from said site or other lands, but without, however, any right to use either the surface of the Property or any portion thereof within 500 feet of the surface for any purpose or purposes whatsoever. 08/12/92 ATTACHMENT NO. 6 6449u/2460/09 Page 1 of 4 2. The Property is conveyed in accordance with and subject to the Redevelopment Plan which was approved and adopted by Ordinance No. 2578, as amended by Ordinance Number 2634 of the City Council of the City of Huntington Beach, and a Disposition and Development Agreement entered into between Grantor and Grantee dated 1992 (the "DDA") , a copy of which is on file with the Grantor at its offices as a public record and which is incorporated herein by reference. 3. The Grantee shall devote, use, operate, and maintain the Property only to the development permitted by and the uses specified in the applicable provisions of the DDA, the Redevelopment Plan for the Project, or any amendments thereof, this Grant Deed, and the CCR's on the Property whichever document is more restrictive. 4. The Property is conveyed to Grantee at a purchase price, herein called "Purchase Price", determined in accordance with the uses permitted. Therefore, Grantee hereby covenants and agrees for itself, its successors, its assigns, and every successor in interest to the Property that the Grantee, such successors and such assigns, shall develop, maintain, use and operate the Property pursuant to the provisions of the DDA. In addition, Grantee shall maintain the improvements on the Property in conformity with this Grant Deed, the recorded CUR's on the Property, and the Huntington Beach Municipal Code and shall keep the Property free from any accumulation of debris or waste materials. Grantee shall also maintain the required landscaping in a healthy condition. If, at any time, Grantee fails to maintain such landscaping, and said condition is not corrected after expiration of five (5) days from the date of written notice from the Grantor, either the Grantor, or the City of Huntington Beach may perform the necessary maintenance and Grantee shall pay such costs as are reasonably incurred for such maintenance. Grantee shall only sell, transfer or convey the Property as a whole parcel and is not permitted to subdivide the Property, except as set out in the DDA, for the duration of the Redevelopment Plan without the prior written approval of the Grantor, or the City of Huntington Beach, if the Agency is no longer in existence at the date of request for approval. 5. For a period until the issuance of a Certificate of Completion as defined in the DDA, the Grantee shall not place or suffer to be placed on the Property any lien or encumbrance other than mortgages, deeds of trust, or any other form of conveyance required for financing of the the construction and operation of the Improvements on the Property and any refinancing of that permanent loan, and any other expenditures necessary and appropriate to develop and operate the Property pursuant to the DDA. The Grantee shall not enter into any such conveyance for financing without prior written approval of Grantor. No approval will be given for a conveyance of the property to finance the construction or improvements on real property other than the real property described in Exhibit A hereto. The sale, transfer, assignment of the Property, or any portion thereof or interest therein by the Grantee is subject to the provisions of Section 109 of the DDA. 08/12/92 ATTACHMENT NO. 6 6449u/2460/09 Page 2 of 4 6. The Grantee agrees for itself and any successor in interest not to discriminate upon the basis of race, color, creed or national origin in the sale, lease, or rental or in the use or occupancy of the Property hereby conveyed or any part thereof. Grantee covenants by and for itself, its successors, and assigns, and all persons claiming under or through them that there shall be no discrimination against or segregation of, any person or group of persons on account of race, color, creed, national origin, religion, sex, marital status, or ancestry in the sale, lease, sublease, transfer, use, occupancy, tenure, or enjoyment of the Property, nor shall the Grantee itself or any person claiming under or through it, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees, or vendees in the Property. The foregoing covenants shall run with the land. 7. No violation or breach of the covenants, conditions, restrictions, provisions or limitations contained in this Grant Deed shall defeat or render invalid or in any way impair the lien or charge of any mortgage or deed of trust or security interest permitted by paragraph 5 of this Grant Deed; provided, however, that any subsequent owner of the Property shall be bound by such remaining covenants, conditions, restrictions, limitations and provisions, whether such owner's title was acquired by foreclosure, deed in lieu of foreclosure, trustee's sale or otherwise. 8. All covenants contained in this Grant Deed shall be covenants running with the land. Grantee's obligation to construct and develop the Developer Improvements on the Property shall terminate and shall become null and void upon recordation of a Certificate of Completion issued by Grantor for the Developer Improvements as defined in the DDA. The covenants contained in paragraphs 3, 4, 5, and 7 shall continue in effect for fifty (50) years from the date of recordation of this Grant Deed. Every covenant contained in this Grant Deed against discrimination contained in paragraph 6 of this Grant Deed shall remain in effect in perpetuity. 9. All covenants without regard to technical classification or designation shall be binding for the benefit of the Grantor, and such covenants shall run in favor of the Grantor for the entire period during which such covenants shall be in force and effect, without regard to whether the Grantor is or remains an owner of any land or interest therein to which such covenants relate. The Grantor, in the event of any breach of any such covenants, shall have the right to exercise all the rights and remedies and to maintain any actions at law or suits in equity or other proper proceedings to enforce the curing of such breach. 08/12/92 ATTACHMENT NO. 6 6449u/2460/09 Page 3 of 4 IN WITNESS WHEREOF, the Grantor and Grantee have caused this instrument to be executed on their behalf by their respective officers hereunto duly authorized, this day of , 19— REDEVELOPMENT AGENCY OF THE CITY OF HUNTINGTON BEACH, a public body corporate and politic By: Chairman "GRANTOR" ATTEST: Secretary APPROVED AS TO FORM Stradling, Yocca, Carlson & Rauth Agency Special Counsel The undersigned Grantee accepts title subject to the conditions and covenants hereinabove set forth. COULTRUP COMPANIES, a California corporation AND BIRTCHER REAL ESTATE LIMITED By: Its: By: Its: "GRANTEE" APPROVED AS TO FORM Counsel to Grantee 08/12/92 ATTACHMENT NO. 6 6449u/2460/09 Page 4 of 4 STATE OF CALIFORNIA ) ss. COUNTY OF ORANGE ) On this day of 199 , before me, the undersigned, a Notary Public in and for said State, personally appeared known to me (or proved to me on the basis of satisfactory evidence) to be the person who executed this instrument as the Chairman of the Redevelopment Agency of the City of Huntington Beach and acknowledged to me that the Redevelopment Agency of the City of Huntington Beach executed it. Signature of Notary Public STATE OF CALIFORNIA ) ss. COUNTY OF ORANGE ) On 19 , before me, the undersigned, a Notary Public in and for said State, personally appeared and , personally known to me or proved to me on the basis of satisfactory evidence to be the persons who executed the within instrument as limited partners of the limited partnership that executed the within instrument, and acknowledged to me that such limited partnership executed the same. WITNESS my hand and official seal. 08/12/92 6449u/2460/09 ATTACHMENT NO. 6 STATE OF CALIFORNIA ) ss. COUNTY OF ORANGE ) On 19 , before me, the undersigned, a Notary Public in and for said State, personally appeared and personally known to me or proved to me on the basis of satisfactory evidence to be the persons who executed the within instrument as limited partners of the limited partnership that executed the within instrument, and acknowledged to me that such limited partnership executed the same. WITNESS my hand and official seal. 08/12/92 6449u/2460/09 ATTACHMENT N0. 6 EXHIBIT A LEGAL DESCRIPTION OF PROPERTY 08/12/92 EXHIBIT A to ATTACHMENT NO. 6 6449u/2460/09 Page 1 of 1 ATTACHMENT NO. 7 RECORDING REQUESTED BY } AND WHEN RECORDED MAIL TO: ) Redevelopment Agency of the City ) of Huntington Beach } 2000 Main Street ) Huntington Beach, CA 92648 ) This document is exempt from the payment of a recording fee pursuant to Government Code Section 6103. REDEVELOPMENT AGENCY OF THE CITY OF HUNTINGTON BEACH By: Its: Dated. 19 DEED OF TRUST AND ASSIGNMENT OF RENTS THIS DEED OF TRUST AND ASSIGNMENT OF RENTS is made as of the day of , 19 , by and among COULTRUP COMPANIES and BIRTCHER REAL ESTATE LIMITED the "Trustor"), whose address is California Title Insurance Company (the "Trustee"), whose address is California , and the Redevelopment Agency of the City of Huntington Beach (the "Beneficiary"), whose address is 2000 Main Street, Huntington Beach, California 92648. FOR GOOD AND VALUABLE CONSIDERATION, including the indebtedness herein recited and the trust herein created, the receipt of which is hereby acknowledged, Trustor hereby irrevocably grants, transfers, conveys and assigns to Trustee, IN TRUST, WITH POWER OF SALE, for the benefit and security of Beneficiary, under and subject to the terms and conditions hereinafter set forth, the property located in the County of Orange, State of California, that is described in Exhibit A, attached hereto and by this reference incorporated herein (the "Site"). TOGETHER WITH all rents, issues, profits, royalties, income and other benefits derived from the Site (collectively, the "rents"), provided that so long as Trustor is not in default hereunder, it shall be permitted to collect rents and operate the Project, as hereinafter defined, in accordance with the 08/12/92 ATTACHMENT NO. 7 6449u/2460/09 Page 1 of 14 requirements of that certain Disposition and Development Agreement entered into between the Trustor, and the Beneficiary dated , 1992 (the "Agreement"), which Agreement is on file with the Beneficiary as a public record and is incorporated by reference herein; TOGETHER WITH all interests, estates or other claims, both in law and in equity which Trustor now has or may hereafter acquire in the Site and the rents; TOGETHER WITH all easements, rights-of-way and rights used in connection therewith or as a means of access thereto, including, without limiting the limitedity of the foregoing, all tenements, hereditaments* and appurtenances thereof and thereto; TOGETHER WITH any and all buildings and improvements now or hereafter erected thereon, and all property of the Trustor now or hereafter affixed to or placed upon the Site, including, without limitation, all fixtures, attachments, appliances, furnishings, equipment and machinery (whether fixed or movable) and other articles (including, in each instance, improvements, restorations, replacements, repairs, additions, accessions or substitutions thereto or therefor); TOGETHER WITH all leasehold estate, right, title and interest of Trustor in and to all leases or subleases covering the Site or any portion thereof now or hereafter existing or entered into, and all right, title and interest of Trustor thereunder, including, without limitation, all cash or security deposits, advance rentals, and deposits or payments of similar nature; TOGETHER WITH all right, title and interest of Trustor in and to all options to purchase or lease the Site or any portion thereof or interest therein, and any greater estate in the Site owned or hereafter acquired; TOGETHER WITH all right, title and interest of Trustor, now owned or hereafter acquired, in and to any land lying within the right-of-way of any street, open or proposed, adjoining the Site, and any and all sidewalks, alleys and strips and gores of land adjacent to or used in connection with the site; TOGETHER WITH all the estate, interest, right, title, other claim or demand, of every nature, in and to such property, including the Site, both in law and in equity, including, but not limited to, all deposits made with or other security given by Trustor to utility companies, the proceeds from any or all of such property, including the Site, claims or demands with respect to the proceeds of insurance in effect with respect thereto, which Trustor now has or may hereafter acquire, any and all awards made for the taking by eminent domain or by any proceeding or purchase in lieu thereof of the whole or any part of such property, including without limitation, any awards resulting from a change of grade of streets and awards for severance damages; All of the foregoing, together with the Site, is herein referred to as the "Security". 08/12/92 ATTACHMENT NO. 7 6449u/2460/09 Page 2 of 14 FOR THE PURPOSE OF SECURING: (a) Payment of the Agency's Equity Interest as defined in Section 202 and Attachment No. 13 of the DDA. (b) Payment of any sums advanced by Beneficiary to protect the Security pursuant to the terms and provisions of this Deed of Trust following a breach of Trustor's obligation to advance said sums and the expiration of any applicable cure period and upon five (5) business days notice to the Trustor, with interest thereon as provided herein; (c) Payment of such additional sums and interest thereon which may hereafter be loaned to Trustor, or its successors or assigns, by Beneficiary, when evidenced by a promissory note or notes or other documents reciting that they are secured by this Deed of Trust; and (d) Performance of every obligation, covenant or agreement of Trustor contained herein or the Agreement (and any amendments thereto). ARTICLE I DEFINITIONS 1. "Agreement" or "DDA" means that Disposition and Development Agreement entered into by and between the Trustor and the Beneficiary hereof, dated , 1992; said Agreement (a copy of which is on file with the Beneficiary at the address stated above, and including all of its attachments) is incorporated herein by reference. 2. "Covenants" means Attachment No. 9 to the Agreement. 3. "Developer Improvements" is defined in the Agreement. 4. The term "Expiration Date" means the date upon which all obligations the performance of which is secured by this Deed of Trust have been satisfied. 5. "Mortgage" means any permanent or long-term loan (other than a loan by an entity related to or controlled by the Developer) , or any other financing device (including without limitation deeds of trust) the proceeds of which are used in the construction of the Developer Improvements, which loan is secured by a security financing interest in the Trustor's interest in the Developer Improvements; 6. "Project" means the "Site" and the "Developer Improvements", together with all additions, improvements, restorations and replacements thereof, and together with the items set forth in the sixth paragraph hereof. 7. "Site" is defined in the second paragraph hereof. 8. "Security" is defined in the eleventh paragraph hereof. 08/12/92 ATTACHMENT NO. 7 6449u/2460/09 Page 3 of 14 9. "Standards" means those standards of construction and operation characteristic of multi-family residential complexes and retail buildings similar in scope to those anticipated by the DDA and which have been constructed with the five (5) years preceding the execution of the Agreement. 10. "Trustor" means Coultrup Companies and Birtcher Real Estate Limited, and its transferees and successors in interest. Where an obligation is created herein binding upon Trustor, the obligation shall apply to and bind any transferees or successors in interest. Where the terms of the Deed of Trust have the effect of creating an obligation of the Trustor and a transferee, such obligation shall be deemed to be a joint and several obligation of the Trustor and such transferee. Unless the context clearly otherwise requires, any capitalized term used herein and not defined herein shall have the meaning given to it under the Agreement (and any amendments thereto). ARTICLE II MAINTENANCE AND MODIFICATION OF THE PROJECT AND SECURITY; RELEASE UPON PAYMENT Section 2.1 Maintenance and Modification of the Project by Trustor. The Trustor agrees that at all times prior to the Expiration Date, the Trustor will, at the Trustor's own expense, maintain, preserve and keep the Project or cause the Project to be maintained, preserved and kept in a condition conforming to the Standards and with only those uses allowed by the Agreement. The Trustor will from time to time make or cause to be made all repairs, replacements and renewals deemed proper and necessary by it. The Beneficiary shall have no responsibility in any of these matters or for the making of improvements or additions to the Project. Trustor agrees to pay fully and discharge (or cause to be paid fully and discharged) all claims for labor done and for material and services furnished in connection with the Security, diligently to file or procure the filing of a valid notice of completion upon completion of construction of any part of the Security, diligently file or procure the filing of a notice of cessation upon the event of a cessation of labor on the work or construction on the Security for a continuous period of thirty (30) days or more, and to take all other reasonable steps to forestall the assertion of claims of lien against the Security or any part thereof. Section 2.2 Release of Land and Improvements. Upon its receipt of the entire Note Amount and all amounts secured by this Deed of Trust, and provided that the Trustor is not in default under the Agreement, the Beneficiary shall, upon the request of the Trustor, deliver to the Trustor such instruments as are reasonably necessary to confirm the release of the Security from the lien of this Deed of Trust. 08/12/92 ATTACHMENT NO. 7 6449u/2460/09 Page 4 of 14 Section 2.3 Granting of Easements. Trustor may grant easements, licenses, rights-of-way or other similar rights or privileges in the nature of easements with respect to any property or rights included in the Security without the prior written approval of the Beneficiary. In the event such rights are granted, the Trustor shall promptly so advise the Beneficiary in writing. ARTICLE III TAXES AND INSURANCE; ADVANCES Section 3.1 Taxes, Other Governmental Charges and Utility Charges. Trustor shall pay, or cause to be paid, at least fifteen 15) days prior to delinquency, all taxes, assessments, charges and levies imposed by any public authority or utility company which are or may become a lien affecting the Security or any part thereof; provided, however, that Trustor shall not be required to pay and discharge any such tax, assessment, charge or levy so long as (a) the legality thereof shall be promptly and actively contested in good faith and by appropriate proceedings, and (b) Trustor maintains reserves adequate to pay any liabilities contested pursuant to this Section 3.1 in accordance with limitedly accepted accounting principles. With respect to special assessments or other similar governmental charges, Trustor shall pay such amount in full prior to the attachment of any lien therefor on any part of the Security unless the Trustor has secured the prior written approval of the Beneficiary to pay such amounts in installments over a period of years. In the event that Trustor shall fail to pay any of the foregoing items required by this Section to be paid by Trustor, Beneficiary may (but shall be under no obligation to) pay the same, after the Beneficiary has notified the Trustor of such failure to pay and the Trustor fails to fully pay any such item within seven (7) business days of the earlier of the receipt or mailing of such notice. Any amount so advanced therefor by Beneficiary, together with interest thereon from the date of such advance at the maximum rate permitted under Section 1(2) of Article XV of the California Constitution, shall become an additional obligation of Trustor to the Beneficiary and shall be secured hereby, and Trustor hereby agrees to pay all such amounts. Section 3.2 Provisions Respecting Insurance. (a) Trustor agrees to provide insurance covering one hundred percent (100%) of the replacement cost of all insurable items within the Project (except interior furniture and fixtures within the individual dwelling units) during the course of construction and following completion in the event of fire, lightning, debris removal, windstorm, flood, vandalism, malicious mischief, theft, mysterious disappearance and hazards, casualties and contingencies as are normally and usually covered by all-risk policies in effect in the locality where the Project is situated. (b) Trustor agrees to carry or cause to be carried: comprehensive limited liability insurance with respect to the Project with limits as set O8/12/92 ATTACHMENT NO. 7 6449u/2460/09 Page 5 of 14 forth in the Agreement during the term of development and for one (1) year thereafter. Following said period and during the term of this Deed of Trust said limits for limited liability coverage shall be not less than $2,000,000 for each occurrence for personal injury (including without limitation bodily injury) and $500,000 with respect to property damage. Coverages thereunder shall include limited liability, owners' and contractors' protection, workers' compensation insurance as required by law. (c) All such insurance policies and coverages (i) shall be maintained at Trustor's sole cost and expense so long as any part of the amounts secured by its Deed of Trust have not been paid, (ii) shall be with insurers of recognized responsibility, and in form and substance satisfactory to the Beneficiary, (iii) shall name Beneficiary as additional insured, and (iv) shall contain a provision to the effect that the insurer shall not cancel the policy or modify it materially and adversely to the interests of Beneficiary without first giving at least thirty (30) days' prior written notice thereof. Certificates of insurance for all of the above insurance policies, showing the same to be in full force and effect, shall be delivered to the Beneficiary upon demand therefor at any time prior to the Expiration Date. Section 3.3 Advances. In the event the Trustor shall fail to maintain the full insurance coverage required by this Deed of Trust or shall fail to keep the Project in good repair and operating condition, the Beneficiary may (but shall be under no obligation to) take out the required policies of insurance and pay the premium on the same or may make such repairs or replacements as are necessary and provide for payment thereof; and, provided that the Beneficiary provides five (5) business days' notice to the Trustor all amounts so advanced therefor by the Beneficiary shall become an additional obligation of the Trustor to the Beneficiary (together with interest as set forth below) and shall be secured hereby, which amounts the Trustor agrees to pay on demand of the Beneficiary, and if not so paid, shall bear interest from the date of the advance at the maximum rate permitted by Section 1(2) of Article XV of the California Constitution. ARTICLE IV DAMAGE, DESTRUCTION OR CONDEMNATION Section 4.1 Damage and Destruction. If, prior to the Expiration Date, the Project or any portion thereof is destroyed (in whole or in part) or is damaged by fire or other casualty, the Trustor shall (a) cause any insurance proceeds arising from insurance referred to in Section 3.2 hereof and any other coverage acquired by the Trustor to be used to promptly rebuild and replace the Project, and (b) repair and replace the Project as necessary to bring the Project into conformity with the Standards; provided that such covenants shall be subordinated to the provisions of all senior obligations to which this Deed of Trust is subordinate. There shall be no abatement in, and Trustor shall be obligated to continue to pay, the amounts payable under this Deed of Trust. 08/12/92 ATTACHMENT NO. 7 6449u/2460/09 Page 6 of 14 Section 4.2 Condemnation. If title to or any interest in or the temporary use of the Project or any part thereof shall be taken under the exercise of the power of eminent domain by any governmental body or by any person, firm or corporation acting under governmental authority, including any proceeding or purchase in lieu thereof, the proceeds as a result of such taking shall be paid as provided by the law of the State of California. ARTICLE V REPRESENTATIONS, COVENANTS AND WARRANTIES OF THE TRUSTOR Section 5.1 Defense of the Title. The Trustor covenants that it is lawfully seized and possessed of title in fee simple to the Site, that it has good right to sell, convey or otherwise transfer or encumber the same, and that the Trustor, for itself and its successors and assigns, warrants and will forever defend the right and title to the foregoing described and conveyed property unto the Beneficiary, its successors and assigns, against the claims of all persons whomsoever, excepting only encumbrances approved by the Beneficiary. Section 5.2 Inspection of the Project. The Trustor covenants and agrees that at any and all reasonable times and upon reasonable notice, the Beneficiary and its duly authorized agents, attorneys, experts, engineers, accountants and representatives, shall have the right, without payment of charges or fees, to inspect the Site. ARTICLE VT AGREEMENTS AFFECTING THE PROJECT; FURTHER ASSURANCES Section 6.1 Other Agreements Affecting Project. The Trustor shall duly and punctually perform all terms, covenants, conditions and agreements binding upon it under the Agreement or any other agreement of any nature whatsoever now or hereafter involving or affecting the Site or any part thereof. Section 6.2 Further Assurances; After Acquired Propert . At any time, and from time to time, upon request by the Beneficiary, the Trustor shall make, execute and deliver, or cause to be made, executed and delivered, to the Beneficiary and, where appropriate, cause to be recorded and/or filed, and from time to time thereafter to be recorded and/or filed, and from time to time thereafter to be rerecorded and/or refiled, at such time and in such offices and places as shall be deemed desirable by the Beneficiary, any and all such other and further deeds of trust, security agreements, financing statements respecting personal property, instruments of further assurance, certificates and other documents as may, in the opinion of the Beneficiary, be necessary or desirable in order to effectuate, complete or perfect, or to continue and preserve, (a) the obligations of the Trustor under this Deed of 08/12/92 ATTACHMENT NO. 7 6449u/2460/09 Page 7 of 14 Trust, and (b) the lien of this Deed of Trust as a lien prior to all liens except those obligations which shall be senior obligations pursuant to the provisions of this Deed of Trust. Upon any failure by the Trustor to do so, the Beneficiary may make, execute, record, file rerecord and/or refile any and all such deeds of trust, security agreements, instruments, certificates and documents for and in the name of the Trustor, and the Trustor hereby irrevocably appoints the Beneficiary the agent and attorney-in-fact of the Trustor to do so. The lien hereof shall automatically attach, without further act, to all after-acquired property deemed to be part of the Security as defined herein. Section 6.3 Agreement to Pay Attorney's Fees and Expenses. In the event of an Event of Default hereunder, and if the Beneficiary should employ attorneys or incur other expenses for the collection of amounts due or the enforcement of performance or observance of an obligation or agreement on the part of the Trustor in this Heed of Trust, the Trustor agrees that it will, on demand therefor, pay to the Beneficiary the reasonable fees of such attorneys and such other reasonable expenses so incurred by the Beneficiary; and any such amounts paid by the Beneficiary shall be added to the indebtedness secured by the lien of this Deed of Trust, and shall bear interest from the date such expenses are incurred at the maximum rate permitted by Section 1(2) of Article XV of the California Constitution. Section 6.4 Subrogation; Payment of Claims. Provided that the Beneficiary gives notice of at least five (5) business days to the Trustor, the Beneficiary shall be subrogated to the claims and liens of all parties whose claims or liens are discharged or paid by the Beneficiary pursuant to the provisions hereof. If permitted in the Mortgage, the Beneficiary shall have the right to pay and discharge the obligations secured by the Mortgage. Section 6.5 Operation of the Site. The Trustor agrees and covenants to operate the Site in full compliance with the Agreement and the Covenants. Section 6.6 Transfer. No sale, transfer, lease, pledge, encumbrance, creation of a security interest in or other hypothecation of the Security shall relieve or release the Trustor from primary liability under this Deed of Trust, the Promissory Note, the Agreement or the Covenants, as the case may be. Section 6.7 Subordination. This Deed of Trust is hereby subordinated by Beneficiary to all future loans for construction and permanent financing to be in first position on the Site. ARTICLE VII EVENTS OF DEFAULT AND REMEDIES Section 7.1 Events of Default Defined. The occurrence of any failure of the Trustor to perform under this Deed of Trust, the Agreement or the Covenants, and the continuation of said failure for a period of thirty (30) 08/12/92 ATTACHMENT NO. 7 6449u/2460/09 Page 8 of 14 days after written notice specifying such failure and requesting that it be remedied shall have been given to Trustor from the Beneficiary pursuant to the Agreement, shall be an Event of Default under this Deed of Trust. Section 7.2 Acceleration of Maturity. If an Event of Default shall have occurred and be continuing, then the entire indebtedness secured hereby shall, at the option of the Beneficiary, immediately become due and payable without notice or demand which are hereby expressly waived, and no omission on the part of the Beneficiary to exercise such option when entitled to do so shall be construed as a waiver of such right. Section 7.3 The Beneficiary's Right to Enter and Take Possession. If an Event of Default shall have occurred and be continuing, the Beneficiary may: (a) Either in person or by agent, with or without bringing any action or proceeding, or by a receiver appointed by a court, and without regard to the adequacy of its security, enter upon the Site and take possession thereof (or any part thereof) and of any of the security, in its own name or in the name of Trustee, and do any acts which it deems necessary or desirable to preserve the value, marketability or rentability of the Site, or part thereof or interest therein, increase the income therefrom or protect the Security hereof and, with or without taking possession of the Site, sue for or otherwise collect the rents, issues and profits thereof, including those past due and unpaid, and apply the same, less costs and expenses of operation and collection, including attorneys' fees, upon any indebtedness secured hereby, all in such order as Beneficiary may determine. The entering upon and taking possession of the Site, the collection of such rents, issues and profits and the application thereof, as aforesaid, shall not cure or waive any Default or notice of Default hereunder or invalidate any act done in response to such Default or pursuant to such notice of Default and, notwithstanding the continuance in possession of the Site or the collection, receipt and application of rents, issues or profits, Beneficiary shall be entitled to exercise every right provided for in this Deed of Trust, the Agreement or by law upon occurrence of any Event of Default, including the right to exercise the power of sale. Trustor requests that a copy of any Notice of Default and a copy of any Notice of sale hereunder be mailed to him at his address given herein; (b) Commence an action to foreclose this Deed of Trust as a mortgage, appoint a receiver, or specifically enforce any of the covenants hereof; (c) Deliver to Trustee a written declaration of default and demand for sale, and a written notice of default and election to cause Trustor's interest in the property to be sold, which notice Trustee or Beneficiary shall cause to be duly filed for record in the Official Records of the County in which the Site is located; or (d) Exercise all other rights and remedies provided herein, in the instruments by which the Trustor acquires title to the Site, including any Security, or in any other document or agreement now or hereafter evidencing, creating or securing all or any portion of the obligations secured hereby, or provided by law. 08/12/92 ATTACHMENT NO. 7 6449u/2460/09 Page 9 of 14 Section 7.4 Foreclosure By Power of Sale. Should the.Beneficiary elect to foreclose by exercise of the power of sale herein contained, the Beneficiary shall notify Trustee and shall deposit with Trustee this Deed of Trust which is secured hereby (and the deposit of which shall be deemed to constitute evidence that the Note Amount is immediately due and payable) , and such receipts and evidence of any expenditures made that are additionally secured hereby as Trustee may require. (a) Upon receipt of such notice from the Beneficiary, Trustee shall cause to be recorded, published and delivered to Trustor such Notice of Default and Election to Sell as then required by law and by this Deed of Trust. Trustee shall, without demand on Trustor, after lapse of such time as may then be required by law and after recordation of such Notice of Default and after Notice of Sale having been given as required by law, sell the Site, at the time and place of sale fixed by it in said Notice of Sale, either as a whole or in separate lots or parcels or items as Trustee shall deem expedient and in such order as it may determine, at public auction to the highest bidder, for cash in lawful money of the United States payable at the time of sale. Trustee shall deliver to such purchaser or purchasers thereof its good and sufficient deed or deeds conveying the property so sold, but without any covenant or warranty, express or implied. The recitals in such deed of any matters or facts shall be conclusive proof of the truthfulness thereof. Any person, including, without limitation, Trustor, Trustee or Beneficiary, may purchase at such sale, and Trustor hereby covenants to warrant and defend the title of such purchaser or purchasers. (b) After deducting all reasonable costs, fees and expenses of Trustee, including costs of evidence of title in connection with such sale, Trustee shall apply the proceeds of sale to payment of: (i) the Note Amount; (ii) all other sums then secured hereby; and (iii) the remainder, if any, to the person or persons legally entitled thereto. (c) Trustee may postpone sale of all or any portion of the Site by public announcement at such time and place of sale, and from time to time thereafter, and without further notice make such sale at the time fixed by the last postponement, or may, in its discretion, give a new notice of sale. Section 7.5 Receiver. If an Event of Default shall have occurred and be continuing, Beneficiary, as a matter of right and without further notice to Trustor or anyone claiming under Security, and without regard to the then value of the Site or the interest of Trustor therein, shall have the right to apply to any court having jurisdiction to appoint a receiver or receivers of the Security (or a part thereof), and Trustor hereby irrevocably consents to such appointment and waives further notice of any application therefor. Any such receiver or receivers shall have all the powers and duties of receivers in like or similar cases, and all the powers and duties of Beneficiary in case of entry as provided herein, and shall continue as such and exercise all such powers until the date of confirmation of sale of the Site, unless such receivership is sooner terminated. Section 7.6 Remedies Cumulative. No right, power or remedy conferred upon or reserved to the Beneficiary by this Deed of Trust is intended to be exclusive of any other right, power or remedy, but each and every such right, 08/12/92 ATTACHMENT NO. 7 6449u/2460/09 Page 10 of 14 power and remedy shall be cumulative and concurrent and shall be in addition to any other right, power and remedy given hereunder or now or hereafter existing at law or in equity. Section 7.7 No Waiver. (a) No delay or omission of the Beneficiary to exercise any right, power or remedy accruing upon any Default shall exhaust or impair any such right, power or remedy, or shall be construed to be a waiver of any such Default or acquiescence therein; and every right, power and remedy given by this Deed of Trust to the Beneficiary may be exercised from time to time and as often as may be deemed expeditious by the Beneficiary. No consent or waiver, expressed or implied, by the Beneficiary to or of any breach by the Trustor in the performance of the obligations hereunder shall be deemed or construed to be a consent to or waiver of obligations of the Trustor hereunder. Failure on the part of the Beneficiary to complain of any act or failure to act or to declare an Event of Default, irrespective of how long such failure continues, shall not constitute a waiver by the Beneficiary of its right hereunder or impair any rights powers or remedies consequent on any breach or Default by the Trustor. (b) If the Beneficiary (i) grants forbearance or an extension of time for the payment of any sums secured hereby, (ii) takes other or additional security or the payment of any sums secured hereby, (iii) waives or does not exercise any right granted herein, or in the Agreement, (iv) releases any part of the Security from the lien of this Deed of Trust, or otherwise changes any of the terms, covenants, conditions or agreements of this Deed of Trust or the Agreement, (v) consents to the filing of any map, plat or replat affecting the Security, (vi) consents to the granting of any easement or other right affecting the Security, or (vii) makes or consents to any agreement subordinating the lien hereof, any such act or omission shall not release, discharge, modify, change or affect the original liability under this Deed of Trust, or any other obligation of the Trustor or any subsequent purchaser of the Security or any part thereof, or any maker, co-signer, endorser, surety or guarantor (unless expressly released); nor shall any such act or omission preclude the Beneficiary from exercising any right, power or privilege herein granted or intended to be granted in the event of any Default then made or of any subsequent Default, nor, except as otherwise expressly provided in an instrument or instruments executed by the Beneficiary shall the lien of this Deed of Trust be altered thereby. In the event of the sale or transfer by operation of law or otherwise of all or any part of the Site, the Beneficiary, without notice, is hereby authorized and empowered to deal with any such vendee or transferee with reference to the Security (or a part thereof) or the indebtedness secured hereby, or with reference to any of the terms, covenants, conditions or agreements hereof, as fully and to the same extent as it might deal with the Trustor and without in any way releasing or discharging any liabilities, obligations or undertakings of the Trustor. Section 7.8 Suits to Protect the Security. The Beneficiary shall have power upon ninety (90 days notice to the Trustor) to (a) institute and maintain such suits and proceedings as it may deem expedient to prevent any impairment of the Security (and the rights of the Beneficiary as secured by 08/12/92 ATTACHMENT NO. 7 6449u/2460/09 Page 11 of 14 ATTACHMENT NO. 9 RECORDING REQUESTED BY ) AND WHEN RECORDED MAIL TO- } } ) Space above for recorder.) This Agreement is recorded at the request and for the benefit of the Agency and is exempt from the payment of a recording fee pursuant to Government Code Section 6103. REDEVELOPMENT AGENCY OF THE CITY OF HUNTINGTON BEACH By: Its: Dated: 19 DECLARATION OF COVENANTS, CONDITIONS, AND RESTRICTIONS THIS DECLARATION OF COVENANTS, CONDITIONS, AND RESTRICTIONS (the "Declaration") is entered into this day of , 199 , by and between the REDEVELOPMENT AGENCY OF THE CITY OF HUNTINGTON BEACH, a public body corporate and politic (the "Agency"), and COULTRUP COMPANIES, a California corporation AND BIRTCHER REAL ESTATE LIMITED, a California limited partnership (the "Developer"), with reference to the following: A. The Developer is fee owner of record of that certain real property (the "Site") located in the City of Huntington Beach, County of Orange, State of California legally described in the attached Exhibit "A". The Site is the subject of a Disposition and Development Agreement between the Agency and the Developer (the "Agreement"). B. The Site is within the Main Pier Redevelopment Project Area (the "Project") in the City of Huntington Beach and is subject to the provisions of the "Redevelopment Plan" for the Project adopted by Ordinance No. 2578 as amended by Ordinance Number 2634 by the City Council of the City of Huntington Beach. 08/12/92 ATTACHMENT NO. 9 1927Q/2460/09 Page 1 of 9 f C. The Agreement provides for the execution and recordation of this document. Except as otherwise expressly provided in this Agreement, all terms shall have the same meanings as set forth in the Agreement. NOW, THEREFORE, THE AGENCY AND THE DEVELOPER AGREE AS FOLLOWS: 1. Developer hereby covenants and agrees that all uses of the Site shall be consistent with the Main Pier Redevelopment Plan. 2. Non-Discrimination The Developer, on behalf of itself and its successors, assigns, and each successor in interest to the Site or any part thereof, hereby covenants and agrees: (a) To use, devote, operate and maintain the Site and each part thereof, for the purposes and the residential uses specified in the Agreement and in the Redevelopment Plan. (b) Not to discriminate upon the basis of sex, marital status, race, color, creed, religion, national origin, or ancestry in the sale, lease, sublease, transfer or rental, or in the use, occupancy, tenure, or enjoyment of the Site or any improvements thereon, or of any part thereof. Each and every deed, lease, and contract entered into with respect to the Site shall contain or be subject to substantially the following nondiscrimination or nonsegregation clauses: (1) In deeds: "The grantee herein covenants by and for itself, it successors and assigns, and all persons claiming under or through them, that there shall be no discrimination against or segregation of any person or group of persons on account of sex, marital status, race, color, creed, religion, national origin, or ancestry in the sale, lease, rental, sublease, transfer, use occupancy, tenure, or enjoyment of the land herein conveyed, nor shall the grantee itself or any persons claiming under or through it, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees, or vendees in the land herein conveyed. The foregoing covenants shall run with the land." (2) In leases: "The lessee herein covenants by and for itself, its successors and assigns, and all persons claiming under or through them, and this lease is made and accepted upon and subject to the following conditions: That there shall be no discrimination against or segregation of any person or group of persons, on account of sex, marital status, race, color, creed, religion, national origin, or ancestry, in the leasing, renting, O8/12/92 ATTACHMENT NO. 9 19279/2460/09 Page 2 of 9 subleasing, transferring, use, occupancy, tenure, or enjoyment of the land herein leased nor shall the lessee itself, or any person claiming under or through it, establish or permit such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, sublessees, subtenants, or vendees in the land herein leased." (3) In contracts: "There shall be no discrimination against or segregation of, any persons, or group of persons on account of sex, marital status, race, color, creed, religion, national origin, or ancestry in the sale, lease, rental, sublease, transfer, use, occupancy, tenure or enjoyment of the land, nor shall the transferee itself or any person claiming under or through it, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees or vendees of the land." 3. Inspection. To the extent permitted by law, the City of Huntington Beach and the Agency shall have the right of entry, at reasonable hours and upon no less than thirty (30) days advance notice, onto the Site to inspect for the need for repairs or maintenance. Entry onto the Site or into any unit for other than emergency repairs may be made only after such advance notice and request for entry. If request for entry is denied or the Site or applicable unit is unoccupied, the City or Agency may apply for an appropriate warrant or other order from a court of appropriate jurisdiction. 4. Exterior Maintenance. The exterior areas of the Site shall be kept free of rubbish, debris and other unsightly or unsanitary materials. The requirements in this Section shall also be incorporated into any covenants, conditions and restrictions which are administered by an association of owners in the Site or any portion of the Site. a. Project Improvement, Maintenance and Repair (1) Land Use Areas and Improvements (a) Exterior yard areas and parking areas shall be kept free of deterioration, includingt (i) Potholes (ii) cracks in asphalt so as to become uneven, Unsightly surface conditions 08/12/92 ATTACHMENT NO. 9 1927Q/2460/09 Page 3 of 9 (iii) Weeds growing through asphalt. (b) Perimeter fencing, landscaping and irrigation system shall be routinely inspected and maintained in good condition. b. Each occupant of the Site shall have the affirmative obligation to prevent what might be considered a fire hazard or a condition dangerous to the public health, safety and limited welfare; or constitute an unsightly appearance or otherwise detract from the aesthetic and property values of neighboring dwelling units and properties. The following minimum performance standards for the maintenance of buildings, yards, and landscaping shall be adhered to by the Developer: (1) Landscaping on the Site shall be absent of the following: (a) Lawns with grasses in excess of six (6) inches in height. (b) Untrimmed hedges. (c) Trees, shrubbery, lawns and other plant life dying from lack of water or other necessary maintenance. (d) Trees and shrubbery grown uncontrolled without proper pruning. (e) Vegetation so overgrown as to be likely to harbor rats or vermin. (f) Dead, decayed or diseased trees, weeds and other vegetation. (g) Inoperative irrigation system(s) . (2) Yard areas shall be maintained so as to be absent of the following: (a) Broken or discarded furniture, appliances and other household equipment stored in yard areas for periods exceeding one (1) week. (b) Packing boxes, lumber, trash, dirt and other debris stored in yards for unreasonable periods in areas visible from public property or neighboring properties. (c) unscreened trash cans, bins or containers stored for unreasonable periods in areas visible from public streets and common areas. 08/12/92 ATTACHMENT NO. 9 1927Q/2460/09 Page 4 of 9 (3) No building, wall or fence may be left in an unmaintained condition so that any of the following exists (a) Buildings abandoned, boarded up, partially destroyed or left unreasonably in a state of partial construction. (a) Unpainted buildings or buildings with peeling paint in such a condition as to: i. Cause dry rat, warping and termite infestation; or ii. Constitute an unsightly appearance that detracts from the aesthetic or property values of neighboring properties. (c) Broken windows, constituting hazardous conditions and/or inviting trespassers and malicious mischief. (d) Damaged garage doors that may become inoperative or unsafe to operate. (e) Graffiti remaining on any portion of the property for a period exceeding five (5) days. (f) Building interiors and exteriors shall be maintained to meet standards of similar residential property in the City of Huntington Beach. 5. Agency and City Right of Review and Enforcement The Agency is a party to this Declaration and the City of Huntington Beach ("City") is hereby expressly made a third party beneficiary to this Declaration for the limited purposes as specified herein as follows: a. Changes or amendments to this Declaration must be submitted for City and Agency review and approval. b. In the event of inaction by the Developer, the City and Agency are hereby granted expedient power to enforce all provisions of this Declaration including, but not limited to, the maintenance of the Improvements and all yards, buildings and landscaping areas within the Site. All costs and expenses incurred by the City and/or the Agency arising out of such enforcement and maintenance shall be charged as an expense of the Developer and shall be paid within ten (10) days of receipt of an invoice for same. C. The City and Agency are hereby granted the express power to enforce all laws and ordinances of the State of California and/or the City of Huntington Beach on yards, structures, and private parking areas within the Site. Nothing within this Declaration, however, shall be construed as imposing an obligation or requiring the City or Agency to enforce any provision thereof. 08/12/92 ATTACHMENT NO. 9 1927Q/2460/09 Page 5 of 9 d. The City and the Agency shall be given prior written notice of any proposed amendment to this Declaration. Such notice shall be given by mailing a copy of the precise language of the proposed amendment to the City of Huntington Beach, c/o City Clerk, together with a letter of transmittal explaining the proposed change in limited terms. The City and the Agency shall have an opportunity to review and comment upon the proposed amendment for a period of not less than forty-five (45) days prior to the effective date of any such proposed amendment. If the City or Agency fail to respond within forty-five (45) days, the proposed change(s) and amendment(s) shall be deemed approved, unless that time period is extended by mutual agreement of all parties. 6. City of Huntington Beach Right of Entry for Code Enforcement, Repair and Traffic Regulation (a) Right of Entry. To the extent permitted by law, Developer hereby acknowledges and intends and thus grants to the City and the Agency, through the City's duly authorized agents or employees, the right to enter upon the Site for the following purposes: (1) Inspection, maintenance and repair of the Site. (2) Enforcement of local traffic and/or parking regulations. (b) Reimbursements of City Expenditures. All costs and expenses incurred by the City and/or the Agency arising out of its inspection, maintenance and repair of the Site, as provided hereinabove ("City Maintenance Costs"), shall be charged as an expense of the Developer and shall be paid within ten (10) days of receipt of an invoice for same. (c) Assessments and Lien Rights of the City. If City Maintenance Costs and/or those costs incurred relating to enforcement or maintenance as set forth in Section 10 above of this Article are not paid within thirty (30) days from the date due, said unpaid costs and expenses shall become a special assessment against the Site and, upon confirmation by the City Council, shall be collected in the same manner as real property taxes and shall be subject to the same penalties, procedures and sale in case of delinquency as is provided for real property taxes. 7. Mortgage Protection Notwithstanding any and all provisions elsewhere in this Declaration to the contrary, in order to induce lenders and investors to participate in the financing of the Developer Improvements, the following provisions are added hereto, and, except as to the effectiveness and enforceability of the Affordable Unit requirements set forth herein, to the extent these added provisions conflict with any other provisions of this Declaration, these added provisions shall control: 08/12/92 ATTACHMENT NO. 9 1927Q/2460/09 Page 6 of 9 (a) Any first mortgagee or third party foreclosure purchaser who comes into possession or who obtains title to the Site pursuant to the remedies provided in the mortgage or foreclosure of the mortgage, or by deed or assignment in lieu of foreclosure, will not be liable for such Site's unpaid charges which accrue prior to such possession or acquisition of title. The assessment liens provided for herein shall be subordinate to the lien or equivalent security interest of any first mortgage recorded prior to the date any such charges become due. Such subordination shall apply only to assessments which accrue prior to a sale or transfer of such Site pursuant to a decree of foreclosure or trustee's sale. Such sale or transfer shall not relieve such Site from liability for any assessments thereafter becoming due or from the lien of any such subsequent assessment. (b) First mortgagees shall have the right to examine the books and records of the Developer during normal business hours. (c) In the event of substantial damage to or destruction of the Site or any portion thereof, the mortgagee of any first mortgage on the Site shall be entitled to timely written notice of any such damage or destruction, and no provision in this Declaration shall be interpreted to entitle the Developer or any other party to priority over any rights of the first mortgagee of the Site pursuant to its mortgage in the case of a distribution to such Developer of insurance proceeds or condemnation awards for losses to or a taking of the Site. (d) If the Site or portion thereof is made the subject matter of any condemnation or eminent domain proceeding or is otherwise sought to be acquired by a condemning authority, then the mortgagee of any first mortgage will be entitled to timely written notice of any such proceeding or proposed acquisition, and no provision in this Declaration shall be interpreted to entitle the Developer or any other party to priority over such mortgagee with respect to the distribution to such lot of the proceeds of any award or settlement. (e) As used in this Section 12, "first mortgagee" means any mortgagee under a mortgage which is a first lien of record made in good faith and for value, or a junior lien of record made in good faith and for value by the City, the Agency or an institutional lender in order to assist in the financing of the construction of the Improvements. (f) No violation of this Declaration shall render invalid or defeat the mortgage of the first mortgagee. 8. Miscellaneous Provisions a. If any provision of this Declaration or portion thereof, or the application to any person or circumstances, shall to any extent be held invalid, inoperative or unenforceable, the remainder of this Declaration, or the application of such provision or portion thereof to any other persons or circumstances, shall not be affected thereby; it shall not be deemed that any 08/12/92 ATTACHMENT No. 9 1927Q/2460/09 Page 7 of 9 such invalid provision affects the consideration for this Declaration; and each provision of this Declaration shall be valid and enforceable to the fullest extent permitted by law. b. This Declaration shall be construed in accordance with the laws of the State of California. C. In the event action is instituted to enforce any of the provisions of this Declaration, the prevailing party in such action shall be entitled to recover from the other party thereto as part of the judgment, reasonable attorney's fees and costs. d. The Developer shall be required to take all reasonable steps necessary to insure that each tenant and all assignees, and transferors have knowledge of all terms and conditions of this Declaration. 9. Runs with the Land The covenants and agreements established in this Agreement shall, without regard to technical classification and designation, be binding on the Developer and any successor in interest to the Site, or any part thereof, for the benefit of and in favor of the Agency, its successor and assigns, and the City of Huntington Beach. The covenants contained in paragraphs 1, 3, and 4 through 13 of this Declaration shall remain in effect for the Affordability Period, and shall automatically terminate and be of no further force or effect after such time. The covenants against discrimination contained in paragraph 2 shall remain in effect in perpetuity. IN WITNESS WHEREOF, the Agency and the Developer have executed this Declaration. of Conditions, Covenants and Restrictions. REDEVELOPMENT AGENCY OF THE CITY OF HUNTINGTON BEACH, a public body corporate and politic Dated: By: Chairman "AGENCY" ATTESTS Agency Secretary 08/12/92 ATTACHMENT NO. 9 1927Q/2460/09 Page 8 of 9 APPROVED AS TO FORM: Stradling, Yocca, Carlson & Rauth, Agency Special Counsel COULTRUP COMPANIES, a California corporation AND BIRTCHER REAL ESTATE LIMITED, a California limited partnership Dated: By: Its: Dateds By: Its: "DEVELOPER" APPROVED AS TO FORMs Counsel to the Developer 08/12/92 ATTACHMENT NO. 9 1927Q/2460/09 Page 9 of 9 ATTACHMENT NO. 9A RECORDING REQUESTED BY ) AND WHEN RECORDED MAIL TO: ) ) ) ) ) ) } [Space above for recorder.] This Agreement is recorded at the request and for the benefit of the Agency and is exempt from the payment of a recording fee pursuant to Government Code Section 6103. REDEVELOPMENT AGENCY OF THE CITY OF HUNTINGTON BEACH By: Its: Dated: 19 DECLARATION OF COVENANTS, CONDITIONS, AND RESTRICTIONS THIS DECLARATION OF COVENANTS, CONDITIONS, AND RESTRICTIONS (the "Declaration") is entered into this day of , 199 , by and between the REDEVELOPMENT AGENCY OF THE CITY OF HUNTINGTON BEACH, a public body corporate and politic (the "Agency"), and , an individual (the "Property Owner"), with reference to the following: A. The Property Owner is fee owner of record of that certain real property (a portion of the "Property Owner's Parcel") located in the City of Huntington Beach, County of Orange, State of California legally described in the attached Exhibit "A". The Property Owner's Parcel is the subject of a Disposition and Development Agreement between the Agency and the Property Owner (the "Agreement") . B. The Property Owner's Parcel is within the Main Pier Redevelopment Project Area (the "Project") in the City of Huntington Beach and is subject to the provisions of the "Redevelopment Plan" for the Project adopted by Ordinance No. 2578 as amended by Ordinance Number 2634 by the City Council of the City of Huntington Beach. 08/12/92 ATTACHMENT NO. 9A 1927Q/2460/09 Page 1 of 9 C. The Agreement provides for the execution and recordation of this document. Except as otherwise expressly provided in this Agreement, all terms shall have the same meanings as set forth in the Agreement. NOW, THEREFORE, THE AGENCY AND THE DEVELOPER AGREE AS FOLLOWS: 1. Property Owner agrees to comply with all provisions relating to the development of his parcel as provided in the Agreement. Such provisions include but are not limited to Section 107, Representation and Warranties as to the Property Owner's Parcel; Sections 301 to Section 308, Development of the Site as it relates to his parcel; Sections 310 to 315, Regulating Encumbrances; Section 401, Uses; Section 402, Maintenance of his parcel; Section 500 et seq. , general provisions; Section 600 et seq. , Defaults and Remedies; and Section 700 et seq., Special Provisions all as relates specifically to issues concerning that individual Property Owner's Parcel. 2. Non-Discrimination The Property Owner, on behalf of itself and its successors, assigns, and each successor in interest to the Property Owner's Parcel or any part thereof, hereby covenants and agrees: (a) To use, devote, operate and maintain the Property Owner's Parcel and each part thereof, for the purposes and the residential uses specified in the Agreement and in the Redevelopment Plan. (b) Not to discriminate upon the basis of sex, marital status, race, color, creed, religion, national origin, or ancestry in the sale, lease, sublease, transfer or rental, or in the use, occupancy, tenure, or enjoyment of the Property Owner's Parcel or any improvements thereon, or of any part thereof. Each and every deed, lease, and contract entered into with respect to the Property Owner's Parcel shall contain or be subject to substantially the following nondiscrimination or nonsegregation clauses: (1) In deeds: "The grantee herein covenants by and for itself, it successors and assigns, and all persons claiming under or through them, that there shall be no discrimination against or segregation of any person or group of persons on account of sex, marital status, race, color, creed, religion, national origin, or ancestry in the sale, lease, rental, sublease, transfer, use occupancy, tenure, or enjoyment of the land herein conveyed, nor shall the grantee itself or any persons claiming under or through it, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees, or vendees in the land herein conveyed. The foregoing covenants shall run with the land." 08/12/92 ATTACHMENT NO. 9A 1927Q/2460/09 Page 2 of 9 (2) In leases: "The lessee herein covenants by and for itself, its successors and assigns, and all persons claiming under or through them, and this lease is made and accepted upon and subject to the following conditions: That there shall be no discrimination against or segregation of any person or group of persons, on account of sex, marital status, race, color, creed, religion, national origin, or ancestry, in the leasing, renting, subleasing, transferring, use, occupancy, tenure, or enjoyment of the land herein leased nor shall the lessee itself, or any person claiming under or through it, establish or permit such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, sublessees, subtenants, or vendees in the land herein leased." (3) In contracts: "There shall be no discrimination against or segregation of, any persons, or group of persons on account of sex, marital status, race, color, creed, religion, national origin, or ancestry in the sale, lease, rental, sublease, transfer, use, occupancy, tenure or enjoyment of the land, nor shall the transferee itself or any person claiming under or through it, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees or vendees of the land." 3. Inspection. To the extent permitted by law, the City of Huntington Beach and the Agency shall, have the right of entry, at reasonable hours and upon no less than thirty (30) days advance notice, onto the Property Owner's Parcel to inspect for the need for repairs or maintenance. Entry onto the Property Owner's Parcel or into any unit for other than emergency repairs may be made only after such advance notice and request for entry. If request for entry is denied or the Property Owner's Parcel or applicable unit is unoccupied, the City or Agency may apply for an appropriate warrant or other order from a court of appropriate jurisdiction. 4. Exterior Maintenance. The exterior areas of the Property Owner's Parcel shall be kept free of rubbish, debris and other unsightly or unsanitary materials. The requirements in this Section shall also be incorporated into any covenants, conditions and restrictions which are administered by an association of owners in the Property Owner's Parcel or any portion of the Property Owner's Parcel. 08/12/92 ATTACHMENT NO. 9A 1927Q/2460/09 Page 3 of 9 a. Project Improvement, Maintenance and Repair (1) Land Use Areas and Improvements (a) Exterior yard areas and parking areas shall be kept free of deterioration, including: (i) Potholes (ii) Cracks in asphalt so as to become uneven, unsightly surface conditions (iii) Weeds growing through asphalt. (b) Perimeter fencing, landscaping and irrigation system shall be routinely inspected and maintained in good condition. b. Each occupant of the Property Owner's Parcel shall have the affirmative obligation to prevent what might be considered a fire hazard or a condition dangerous to the public health, safety and limited welfare; or constitute an unsightly appearance or otherwise detract from the aesthetic and property values of neighboring dwelling units and properties. The following minimum performance standards for the maintenance of buildings, yards, and landscaping shall be adhered to by the Property Owner: (1) Landscaping on the Property Owner's Parcel shall be absent of the following: (a) Lawns with grasses in excess of six (6) inches in height. (b) Untrimmed hedges. (c) Trees, shrubbery, lawns and other plant life dying from lack of water or other necessary maintenance. (d) Trees and shrubbery grown uncontrolled without proper pruning. (e) Vegetation so overgrown as to be likely to harbor rats or vermin. (f) Dead, decayed or diseased trees, weeds and other vegetation. (g) Inoperative irrigation system(s). (2) Yard areas shall be maintained so as to be absent of the following: (a) Broken or discarded furniture, appliances and other household equipment stored in yard areas for periods exceeding one (1) week. 08/12/92 ATTACHMENT NO. 9A 1927Q/2460/09 Page 4 of 9 t (b) Packing boxes, lumber, trash, dirt and other debris stored in yards for unreasonable periods in areas visible from public property or neighboring properties. (c) Unscreened trash cans, bins or containers stored for unreasonable periods in areas visible from public streets and common areas. (3) No building, wall or fence may be left in an unmaintained condition so that any of the following exist: (a) Buildings abandoned, boarded up, partially destroyed or left unreasonably in a state of partial construction. (a) Unpainted buildings or buildings with peeling paint in such a condition as to: i. Cause dry rot, warping and termite infestation; or ii. Constitute an unsightly appearance that detracts from the aesthetic or property values of neighboring properties. (c) Broken windows, constituting hazardous conditions and/or inviting trespassers and malicious mischief. (d) Damaged garage doors that may become inoperative or unsafe to operate. (e) Graffiti remaining on any portion of the property for a period exceeding five (5) days. (f) Building interiors and exteriors shall be maintained to meet standards of similar residential property in the City of Huntington Beach. 5. Agency and City Right of Review and Enforcement The Agency is a party to this Declaration and the City of Huntington Beach ("City") is hereby expressly made a third party beneficiary to this Declaration for the limited purposes as specified herein as follows: a. Changes or amendments to this Declaration must be submitted for City and Agency review and approval. b. In the event of inaction by the Property Owner, the City and Agency are hereby granted expedient power to enforce all provisions of this Declaration including, but not limited to, the maintenance of the Improvements and all yards, buildings and landscaping areas within the Property Owner's Parcel. All costs and expenses incurred by the City and/or the Agency arising 08/12/92 ATTACHMENT NO. 9A 1927g/2460/09 Page 5 of 9 out of such enforcement and maintenance shall be charged as an expense of the Property Owner and shall be paid within ten (10) days of receipt of an invoice for same. C. The City and Agency are hereby granted the express power to enforce all laws and ordinances of the state of California and/or the City of Huntington Beach on yards, structures, and private parking areas within the Property Owner's Parcel. Nothing within this Declaration, however, shall be construed as imposing an obligation or requiring the City or Agency to enforce any provision thereof. d. The City and the Agency shall be given prior written notice of any proposed amendment to this Declaration. Such notice shall be given by mailing a copy of the precise language of the proposed amendment to the City of Huntington Beach, c/o City Clerk, together with a letter of transmittal explaining the proposed change in limited terms. The City and the Agency shall have an opportunity to review and comment upon the proposed amendment for a period of not less than forty-five (45) days prior to the effective date of any such proposed amendment. If the City or Agency fail to respond within forty-five (45) days, the proposed change(s) and amendment(s) shall be deemed approved, unless that time period is extended by mutual agreement of all parties. 6. City of Huntington Beach Right of Entry for Code Enforcement, Repair and Traffic Regulation (a) Right of Entry. To the extent permitted by law, Property Owner hereby acknowledges and intends and thus grants to the City and the Agency, through the City's duly authorized agents or employees, the right to enter upon the Property Owner's Parcel for the following purposes: (1) Inspection, maintenance and repair of the Property Owner's Parcel. (2) Enforcement of local traffic and/or parking regulations. (b) Reimbursements of City Expenditures. All costs and expenses incurred by the City and/or the Agency arising out of its inspection, maintenance and repair of the Property Owner's Parcel, as provided hereinabove ("City Maintenance Costs"), shall be charged as an expense of the Property Owner and shall be paid within ten (10) days of receipt of an invoice for same. (c) Assessments and Lien Rights of the City. If City Maintenance Costs and/or those costs incurred relating to enforcement or maintenance as set forth in Section 10 above of this Article are not paid within thirty (30) days from the date due, said unpaid costs and expenses shall become a special assessment against the Property Owner's Parcel and, upon confirmation by the City Council, shall be collected in the same manner as real property taxes and shall be subject to the same penalties, procedures and sale in case of delinquency as is provided for real property taxes. 08/12/92 ATTACHMENT NO. 9A 1927Q/2460/09 Page 6 of 9 i 7. Mortgage Protection Notwithstanding any and all provisions elsewhere in this Declaration to the contrary, in -order to induce lenders and investors to participate in the financing of the Property Owner Improvements, the following provisions are added hereto, and, except as .to the effectiveness and enforceability of the Affordable Unit requirements set forth herein, to the extent these added provisions conflict with any other provisions of this Declaration, these added provisions shall control: (a) Any first mortgagee or third party foreclosure purchaser who comes into possession or who obtains .title to the Property Owner's Parcel pursuant to the remedies provided in the mortgage or foreclosure of the mortgage, or by deed or assignment in lieu of foreclosure, -will. not be liable for such Property Owner's Parcel's unpaid charges which accrue prior .to such possession or acquisition of title. The assessment liens provided for herein shall be subordinate to the lien or equivalent security interest of any first mortgage recorded prior to the date any such charges become due. Such subordination shall apply only to assessments which accrue prior to a sale or transfer of such Property Owner's Parcel pursuant to a decree of foreclosure or trustee's sale. Such sale or transfer shall not relieve such Property Owner's Parcel from liability for any assessments thereafter becoming due or from the lien of any such subsequent assessment. (b) First mortgagees shall have the right to examine the books and records of the Property Owner during normal business hours. (c) In the event of substantial damage to or destruction of the- Property Owner's Parcel or any portion thereof, the mortgagee of any first mortgage on the Property Owner's Parcel shall be entitled to timely written notice of any such damage or destruction, and no provision in this Declaration shall be interpreted to entitle the Property Owner or any other party to priority over any rights of the first mortgagee of the Property Owner's Parcel pursuant to its mortgage in the case of a distribution to such Property Owner of insurance proceeds or condemnation awards for losses to or a taking of the Property Owner's Parcel. (d) If the Property Owner's Parcel or portion thereof is made the subject matter of any condemnation or eminent domain proceeding or is otherwise sought to be acquired by a condemning authority, then the mortgagee of any first mortgage will be entitled to timely written notice of any such proceeding or proposed acquisition, and no provision in this Declaration shall be -interpreted to entitle the Property Owner or any other party to priority over such mortgagee with respect to the distribution to such lot of the proceeds of any award or settlement. (e) As used in this Section 12, "first mortgagee" means any mortgagee under a mortgage which is a first lien of record made in good faith and for value, or a junior lien of record made in good faith and for value by the City, the Agency or an institutional lender in order to assist in the financing of the construction of the Improvements. 08/12/92 ATTACHMENT NO. 9A 1927Q/2460/09 Page 7 of 9 (f) No violation of this Declaration shall render invalid or defeat the mortgage of the first mortgagee. S. Miscellaneous Provisions a. If any provision of this Declaration or portion thereof, or the application to any person or circumstances, shall to any extent be held invalid, inoperative or unenforceable, the remainder of this Declaration, or the application of such provision or portion thereof to any other persons or circumstances, shall not be affected thereby; it shall not be deemed that any such invalid provision affects the consideration for this Declaration; and each provision of this Declaration shall be valid and enforceable to the fullest extent permitted by law. b. This Declaration shall be construed in accordance with the laws of the State of California. C. In the event action is instituted to enforce any of the provisions of this Declaration, the prevailing party in such action shall be entitled to recover from the other party thereto as part of the judgment, reasonable attorney's fees and costs. d. The Property Owner shall be required to take all reasonable steps necessary to insure that each tenant and all assignees, and transferors have knowledge of all terms and conditions of this Declaration. 9. Runs with the Land The covenants and agreements established in this Agreement shall, without regard to technical classification and designation, be binding on the Property Owner and any successor in interest to the Property Owner's Parcel, or any part thereof, for the benefit of and in favor of the Agency, its successor and assigns, and the City of Huntington Beach. The covenants contained in paragraphs 1, 3, and 4 through 13 of this Declaration shall remain in effect for the Affordability Period, and shall automatically terminate and be of no further force or effect after such time. The covenants against discrimination contained in paragraph 2 shall remain in effect in perpetuity. IN WITNESS WHEREOF, the Agency and the Property Owner have executed this Declaration of Conditions, Covenants and Restrictions. REDEVELOPMENT AGENCY OF THE CITY OF HUNTINGTON BEACH, a public body corporate and politic Dateds By: Chairman "AGENCY" 08/12/92 ATTACHMENT NO. 9A 1927Q/2460/09 Page 8 of 9 ATTEST: Agency Secretary APPROVED AS TO FORM: Stradling, Yocca, Carlson & Rauth, Agency Special Counsel Dated: By: Its: Dated: By: Its: "PROPERTY OWNER" APPROVED AS TO FORMS Counsel to the Property Owner 08/12/92 ATTACHMENT NO. 9A 1927Q/2460/09 Page 9 of 9 STATE OF CALIFORNIA ) ss. COUNTY OF ORANGE } On this day of 19 before me, the undersigned, a Notary Public in and for said State, personally appeared if known to me (or proved to me on the basis of satisfactory evidence) to be the person who executed this instrument as the Chairman of the Huntington Beach Agency for Community Development and acknowledged to me that the Huntington Beach Agency for Community Development executed it. Signature of Notary Public (SEAL) STATE OF CALIFORNIA ) } ss. COUNTY OF ORANGE } On 19_, before me, the undersigned, a Notary Public in and for said State, personally appeared and , personally known to me or proved to me on the basis of satisfactory evidence to be the persons who executed the within instrument as limited partners of the limited partnership that executed the within instrument, and acknowledged to me that such limited partnership executed the same. WITNESS my hand and official seal. 08/12/92 1927Q/2460/09 ATTACHMENT NO. 9-A STATE OF CALIFORNIA ) ss. COUNTY OF ORANGE ) On 19_, before me, the undersigned, a Notary Public in and for said State, personally appeared and , personally known to me or proved to me on the basis of satisfactory evidence to be the persons who executed the within instrument as limited partners of the limited partnership that executed the within instrument, and acknowledged to me that such limited partnership executed the same. WITNESS my hand and official seal. 08/12/92 1927Q/2460/09 ATTACHMENT NO. 9-A ATTACHMENT NO. 9-A EXHIBIT A Legal Description f 08/12/92 EXHIBIT A 1927Q/2460/09 ATTACHMENT NO. 9-A I ATTACHMENT NO. 10 GUARANTY AND AGREEMENT OF BIRTCHER REAL ESTATE LIMITED THE REDEVELOPMENT AGENCY OF THE CITY OF HUNTINGTON BEACH (the "Agency") and BIRTCHER REAL ESTATE LIMITED, a California limited partnership (the "Developer" ) have entered into a Disposition and Development Agreement dated as of , 1992 (the "Agreement") . The Agreement provides that BIRTCHER ! REAL ESTATE LIMITED (the "Guarantor") shall make and deliver a guaranty as provided in the Agreement. R E C I T A L S A. The Guarantor will benefit by the Agreement. The j Agreement will redevelop and increase commercial activity within the vicinity of the "Site" (as Site is defined in the Agreement) . B. The execution by the Guarantor of this Guaranty is a condition but for which the Agency would not execute the Agreement. C. The Guarantor has reviewed this Guaranty and the Agreement with counsel of its choosing. In consideration of the execution of the Agreement and of other valuable consideration, receipt of which is hereby acknowledged: 1. Guarantor guarantees to each of Agency the full, timely and faithful performance by Developer of all of its obligations, duties, promises, covenants and agreements as set forth in the Agreement, including without limitation development of the Developer Improvements and the payment of the Agency Equity Participation Amount and all other consideration payable by the Developer pursuant to the Agreement. 2. This Guaranty is unconditional and may be enforced directly against the Guarantor. No extensions, modifications or changes to the Agreement shall release the Guarantor or affect this Guaranty in any way, and the Guarantor waives notification thereof. 3 . The Guarantor hereby waives all of the suretyship provisicns of the California Civil Code Sections 2788 through 2855. 08/12/92 ATTACHMENT NO. 10 1927Q/2460/09 Page 1 of 5 4. Guarantor waives: (a) any defense based upon any legal disability or other defense of Developer, any other guarantor or other person or by reason of the cessation or limitation of the liability of Developer from any cause other than full payment of all sums payable under the Agreement (including without limitation the Attachments thereto) ; (b) any defense based upon any lack of authority of the officers, directors, partners or agents acting or purporting to act on behalf of Developer or any principal of Developer or any defect in the formation of Developer or any principal of Developer; (c) any defense based upon the application by Developer of the funds for purposes other than the purposes represented by Developer to Agency or intended or understood by Agency or Guarantor; (d) any defense based upon Agency' s election of any remedy against Guarantor or Developer or both including, without limitation, election by Agency to exercise its rights under the power of sale set forth in the Deed of Trust (Attachment No. 7 to the Agreement) and the consequent loss by Guarantor of the right to recover any deficiency from Developer; (e) any defense based upon Agency' s failure to disclose to Guarantor any information concerning Developer' s financial condition or any other circumstances bearing on Developer' s ability to pay all sums payable under the Agreement (including without limitation the Attachments thereto) ; (f) any defense based upon any statute or rule of law which provides that the obligation of a surety must be neither larger in amount nor in any other respects more burdensome than that of a principal; (g) any defense based upon Agency' s election, in any proceeding instituted under the Federal Bankruptcy Code, of the application of Section 1111(b) (2) of the Federal Bankruptcy Code or any successor statute; (h) any defense based upon any borrowing or any grant of a security interest under Section 364 of the Federal Bankruptcy Code; (i) any right of subrogation, any right to enforce any remedy which Agency may have against Developer or any other guarantors and any right to participate in, or benefit from, any security for the Agreement or the Creditor Agreement (including without limitation the Attachments thereto) now or hereafter held by Agency; (j ) presentment, demand, protest and notice of any kind; and (k) the benefit of any statute of limitations affecting the liability of Guarantor hereunder or the enforcement hereof. Guarantor agrees that the payment of all sums payable under the Agreement (including without limitation the Attachments thereto) or any part thereof or other act which tolls any statute of limitations applicable to the Agreement (including without limitation the Attachments thereto) shall similarly operate to toll the statute of limitations applicable to Guarantor' s liability hereunder. Without limiting the generality of the foregoing or any other provision hereof, Guarantor expressly waives any and all benefits which might otherwise be available to Guarantor under California Civil Code 08/12/92 ATTACHMENT NO. 10 1927Q/2460/09 Page 2 of 5 Sections 2809, 2810, 2819, 2839, 2845, 2849, 2850, 2899 and 3433 and California Code of Civil Procedure Sections 580(a) , 580(b) , 580(d) and 726, or any of such sections. 5. Guarantor hereby waives and agrees not to assert or take advantage of (a) any right to require Agency to proceed against the Developer (or any guarantor other than the undersigned) or to pursue any other remedy in the Agency' s power before proceeding against the Guarantor, (b) demand, protest, and notice which the Agency may be required to be provided to Developer under the Agreement, and (c) any duty on the part of Agency to disclose to Guarantor any facts Agency or the City of Huntington Beach now or hereafter know about the Site, the Agreement, or the Developer, regardless of whether Agency has reason to believe that any such facts materially increase the risks beyond that which Guarantor intends to assume or has reason to believe that such facts are unknown to Guarantor or has a reasonable opportunity to communicate such facts to Guarantor, it being understood and agreed that Guarantor is fully responsible for being and keeping informed of all circumstances regarding the Site, the Agreement, the obligations of the Developer, the financial condition of the Developer or any of the Interested Persons and of all circumstances bearing on the risk of any obligation by Developer (and all of the Interested Persons) hereby guaranteed. 6. Guarantor shall have no right of subrogation and waives any right to enforce any remedy the Agency now has or may hereafter have against the Developer, and any benefit of, and any right to participate in any security now or hereafter held by Agency. 7. ' The obligations of Guarantor hereunder are independent of the obligations of Developer and, in the event of default hereunder, a separate action or actions may be brought and prosecuted against Guarantor (or any other guarantor) whether or not Developer (or any other guarantor) is joined therein or a separate action or actions are brought against Developer. e. In the event of any litigation between Agency and Guarantor arising out of this Guaranty, the prevailing party shall be entitled to recover its reasonable costs and attorney' s fees. 9. No provision of this Guaranty can be waived nor can Guarantor be released from the obligations hereunder except by a writing duly executed by the Agency. 10. Guarantor agrees to pay all reasonable attorney' s fees and all other costs and expenses which may be incurred by Agency in enforcing or attempting to enforce this Guaranty, whether the same shall be enforced by suit or otherwise. 08/12/92 ATTACHMENT NO. 10 1927Q/2460/09 Page 3 of 5 11. Guarantor hereby waives notice of any demand by the Agency, as well as notice of any default by the Developer. 12. The Agency may assign this Guaranty. When so assigned, Guarantor shall be bound as above to the assignees without in any manner affecting Guarantor' s liability hereunder. 13 . This Guaranty shall remain in effect notwithstanding any bankruptcy, reorganization or insolvency of the Developer or any successor or assignee thereof or any disaffirmance by a trustee of the Developer. 14. This Guaranty shall inure to the benefit of and bind the successors and assigns of Agency and Guarantor. 15. Guarantor agrees that jurisdiction and venue with respect to any matter pertaining to the Guaranty or acts or omissions hereunder shall lie exclusively with the Superior Court of the County of San Bernardino, State of California, in an appropriate municipal court of that county, or in the Federal District Court in the Central District of California. Guarantor irrevocably waives any and all defenses based upon revenue or forum non conveniens. 16. The laws of the State of California shall govern the i interpretation and enforcement of this Guaranty. IN WITNESS WHEREOF, the undersigned has executed this Guaranty this day of 1992. i i By: Its: By: Its: I a 08/12/92 ATTACHMENT NO. 10 1927Q/2460/09 Page 4 of 5 i STATE OF CALIFORNIA ) ss. COUNTY OF ) On before me, the undersigned, a Notary Public in and for said State, personally appeared personally known to me or proved to me on the basis of satisfactory evidence to be the person who executed the within instrument as the Managing Partner, and , personally known to me or proved to me on the basis of satisfactory evidence to be the person who executed the within instrument as the Managing Partner of the limited partnership that executed the within instrument. WITNESS my hand and official seal. (SEAL) 08/12/92 ATTACHMENT NO. 10 1927Q/2460/09 Page 5 of 5 ATTACHMENT NO. 12 EXISTING PARKING The following lists the properties and the estimated parking occurred by the current and previous uses: Est. Bldg. Parking/ Total Property Area Use Ratio Property Parking Mase 2,000 sf Retail 1/200 10 10 Spaces Draper 2,000 sf Retail 1/200 10 600 sf Food 1/100 6 16 Alfonso/Geilim 2,600 sf Food 1/100 26 26 Mulligan/Johnson 2,500 sf Food/Bar 1/100 25 250 sf Dance 1/50 5 2,600 sf 2nd Floor 1/250 13 43 Bagstad 4,950 sf Retail 1/200 25 4.800 sf 2nd Floor 1/250 24 49 Cracchiolo 3,000 sf Food 1/100 30 30 Estimate of total parking to be grandfathered: 174 Spaces 08/12/92 ATTACHMENT NO, 12 1927Q/2460/09 Page 1 of 1 ATTACHMENT NO. 13 EQUITY PARTICIPATION PROCEDURE I . AGENCY PARTICIPATION AMOUNT FOR BLOCK 105 Participant has agreed to pay Agency fifty percent (50%) of its net sales proceeds (as defined herein) in excess of one hundred percent (100%) of Development Costs, including a 10% return on equity investment and a 8% annual return on total value developer return. This participation is secured by Deed of Trust (Attachment No. 7) recorded on Block 105 of Site. 1. Developer Costs shall include: reasonable and customary fees paid to third party subcontractors obtained through a bid process; Developer overhead three percent (3%) of value all consultants, legal fees; general contractor' s fee of five percent (5%) of the construction budget prepared by the lender; supervisor and administration is 15% of direct construction budget; the land costs to the extent they are incurred separate from the construction loan; loan interest and loan origination fees to extent not equity partners; public entity permits and fees; cost of sales including salesperson administration, advertising, sale model unit furnishing and cost and contingency of the construction budget prepared by lender. 2. Upon the completion of construction, Participant shall submit to Agency for its review and approval a detailed account of the Development Costs of the Project from inception through the date of issuance of a Certificate of Occupancy (the "Effective Date") . After the Effective Date until all condominium units are sold, Participant shall submit on a monthly basis a detailed account of the Development Costs incurred since the Certificate of Occupancy, and the information necessary to calculate the Net Sales Proceeds (as defined below) . These post-Certificate of Occupancy Development Costs shall be discounted to their value as of Effective Date at the actual rate of interest charged on Participant' s construction or take-out loan (the "Discount Rate") . 3. On a monthly basis Developer shall calculate on a form provided by Agency and submit for Agency review the value as of the Effective Date of Participant' s total Net Proceeds as defined below using the Discount Rate. The "Net Proceeds" are: (i) the gross sales proceeds from the sale of condominium units less all third party costs including, without limitation, the following: brokerage commissions; 08/12/92 ATTACHMENT NO, 13 1927Q/2460/09 Page 1 of 5 escrow costs; state, county, city or other documentary stamps and transfer taxes; recording fees; notary fees; ad valorem taxes, if any, upon that unit for any time prior to conveyance of title; warranty costs; and title insurance costs paid by Participant. In addition, the value as of the Effective Date (using the Discount Rate) of homeowner association fees paid by Participant shall be subtracted from gross sales proceeds. No development or management fees shall be deducted from gross sales proceeds, as these fees are included in the one hundred percent (100%) of Development Costs which Participant may realize prior to payment of the Agency Participation Amount; (ii) If any units are rented rather than sold, the parties shall deem the unit sold as of the date of occupancy, and the fair market value of such unit as of the Effective Date shall be included in Net Sales Proceeds. Participant shall submit to Agency its calculation of such unit' s fair market value together with Participant' s calculations and assumptions used to compute such value. As used herein, "Fair Market Value" means the highest price on the date of valuation that would be agreed to by a seller, being willing to sell but under no particular or urgent necessity for so doing, nor obliged to sell, and a buyer, being ready, willing, and able to buy but under no particular necessity for so doing, each dealing with the other with full knowledge of all the uses and purposes for which the property is reasonably adaptable and available; and (iii) gross proceeds of any permanent financing, refinancing or other disposition of Block 105 apart from the sale of individual units to users. 4. Participant shall pay to Agency within 90 days of receipt of the Net Sales Proceeds, the "Current Value" (as defined below) of the Agency Participation Amount. The "Current Value" shall be the amount calculated in the preceding sentence plus interest at the Discount Rate from the Effective Date until paid. S. Attached hereto as Exhibit "A" are worksheets to illustrate the calculation of the Agency' s Participation Amount. b. In the event of a foreclosure of any mortgage (or transfer by deed in lieu thereof) encumbering the Combined Parcels, Agency' s right to receive the Agency Participation Amount with respect to such transfer shall be subordinate to the applicable mortagee' s right to receive proceeds in the full amount of all outstanding obligations secured by such mortgage. 08/12/92 ATTACHMENT NO, 13 1927Q/2460/09 Page 2 of 5 II . INSPECTION OF BOOKS AND RECORDS Participant shall keep full and accurate books and accounts, records, cash receipts, and other pertinent data directly related to the calculation of Agency Participation Amounts submitted by Participant under Section I above ( "Records" ) . Such Records shall be kept for a period of two (2) years after the end of the sale of the last condominium unit. •Agency shall be entitled, not more than two (2) times per calendar year to inspect, examine and copy, at Agency' s sole expense, the Records relevant to the calculation of the Agency Participation Amount, provided that such inspection, examination and copying shall be upon three (3) days' prior notice to Participant, Such inspection, examination and copying shall be made at such time and place as Participant may reasonably designate. Any transfer of Records for such inspection, examination and copying shall be at Agency' s sole expense. Participant shall cooperate fully with Agency in making the inspection. Agency shall not divulge any information gained from such inspection other than to carry out the purposes of this Section II and Section I above; provided, however, that Agency shall be permitted to divulge the contents i of any such inspection in connection with any administrative or judicial proceedings in which Agency is involved where Agency is required to divulge such information. 1. Right to Audit. In the event of a dispute between Agency and Participant regarding the calculations of the Agency Participation Amount, Agency or its designated agent shall have the right to audit the Records for the purpose of verifying the Agency Participation Amount subject to the following terms and conditions: (a) Agency shall have the right to make such audit, not more than once for any calendar year. (b) Agency shall give Participant at least fifteen (15) days' written notice of its desire to conduct such audit, and such audit shall be made at such time and place as Participant may reasonably designate; (c) Such audit shall be limited to the Records relevant to the calculation and payment of Agency' s Participation Amount; (d) Such audit shall be performed by an independent certified public accountant or by Agency' s or City' s in-house auditor (the "Auditor") ; 2 . Waiver. If Agency has not performed an audit within three years after the sale by Participant of all condominium units, then Agency shall be deemed to have waived 08/12/92 ATTACHMENT NO, 13 1927Q/2460/09 Page 3 of 5 i I its right to audit the Records, and the facts contained in Participant' s determination of Agency' s Participation Amount shall be conclusive and binding upon Agency. 3. Result of Audit/Participant Challenge. Within 20 days following any audit performed by Agency, Agency shall provide Participant with an audit report setting forth the Auditor' s findings in reasonable detail, including any schedules or attachments necessary to interpret such findings (the "Audit Report" ) . The Audit Report shall be accompanied by Agency' s written demand for payment (pursuant to Subsection 609.4 below) if an underpayment is disclosed by the Audit Report. Participant shall have a period of thirty (30) days following its receipt of the Audit Report in which to review the Audit Report, interview the Auditor (who shall be made reasonably available to Participant during such period) and, if Participant reasonably determines based upon its review of the Audit Report to dispute the results of any audit conducted by Agency, provide Agency with written objections stating in reasonable detail Participant' s specific objections to the Audit Report. For a period of ninety (90) days following the delivery of Participant' s challenge to Agency, Participant and Agency shall negotiate in good faith in order to resolve any dispute concerning the Audit Report. If Participant and Agency fail to resolve each issue in dispute concerning the results of an audit within ninety (90) days following Participant' s receipt of the Audit Report, either party may seek resolution of such disputed issues by arbitration as provided in 608.5. In such event, neither Agency nor Participant shall be in default with respect to such underpayment or overpayment and the payment of any sums shown to be owing to Agency or Participant by such audit, including any underpayment or overpayment of the Agency Participation Amount, shall be payable in accordance with Subsections 11 .4 and II .5 below, as applicable. 4. Underpayment. In the event an unchallenged audit (including an audit, or portion thereof, which is disputed but then such dispute is resolved) or final judicial determination, as the case may be, discloses an underpayment of the Agency Participation Amount, Participant shall pay the amount of such underpayment (or the undisputed portion thereof) within thirty (30) days after the later of the date (a) Participant receives the Audit Report and Agency' s written demand to pay such underpayment; (b) a disputed audit, or the applicable portion thereof, is resolved; or (c) a final judicial determination of a disputed audit is rendered that discloses such underpayment ("Underpayment Determination Date" ) . Interest shall accrue at the Reference Rate announced by the Bank of America from time to time ("Reference Rate" ) on the amount of such underpayment 08/12/92 ATTACMIENT NO, 13 1927Q/2460/09 Page 4 of 5 from the day the underpayment was due until paid; provided, that in the event that the underpayment exceeds 37. of the amount of Agency Participation Amount actually owing, interest shall accrue at the Reference Rate plus 3% on the amount of such underpayment was due until paid. In the event such underpayment exceeds 5% of the amount of the Agency Participation Amount actually owing, then Participant shall reimburse Agency for all reasonable costs and expenses incurred by Agency in connection with any audit and/or judicial action. Except as set forth in the preceding sentence, Agency shall pay its own cost of any audit and/or judicial action. In no event shall the failure by Participant to pay such underpayment at the time it would have otherwise been due under this Lease constitute a Default in the payment of rent under this Lease, provided the amount of such underpayment is paid within such thirty (30) day period after the Underpayment Determination Date, nor shall participant be subject to any fee, penalty or liquidated damages on account of such underpayment. 5. Overpayment. In the event an unchallenged audit (including an audit, or portion thereof, which is disputed but then resolved) or final judicial determination, as the case may be, discloses an overpayment of the Agency Participation Amount, Agency shall pay the amount of such overpayment (or the undisputed portion thereof) within thirty (30) days after the later of the date (a) Participant receives the Audit Report disclosing such overpayment; (b) a disputed audit, or the applicable portion thereof, is resolved; or (c) a final judicial determination of a disputed audit is rendered that discloses such overpayment ("Overpayment Determination Date" ) . Interest shall accrue at the Reference Rate on the amount due but unpaid as of the Overpayment Determination Date. 08/12/92 ATTACHMENT NO, 13 1927Q/2460/09 Page 5 of 5 MOVED CITY CLERK( CITY 4F HUHTIHCT'k 3_tCH,CALIF. !�ov I3 I0 ©3 '92 DISPOSITION AND DEVELOPMENT AGREEMENT by and between the REDEVELOPMENT AGENCY OF THE CITY OF HUNTINGTON BEACH, AGENCY, and COULTRUP COMPANIES, a California corporation AND BIRTCHER REAL ESTATE LIMITED, DEVELOPER TABLE OF CONTENTS I. [ §100] SUBJECT OF AGREEMENT A. [ 5101] Purpose of Agreement B. [ §102] The Redevelopment Plan C. [ §103] The Site D. [ §104] Parties to the Agreement 1. [ §105] The Agency 2. [ §106] The Developer 3. [ §107] Representations and Warranties of the Parties 4. [ §108] Guarantors 5. [ §109] Prohibition Against Change in Ownership, Management and Control of Developer 6. [ §120] Transfer of Limited Partnership Interest; Indemnity 7. [ §111] Good Faith Deposit 8. [ §112 ] Relationship of Agency and Developer II . [ §200] ASSEMBLY OF THE SITE A. [ §201] Acquisition of Third Party Parcels B. [ §202] Disposition of Agency Parcels; Actions to be Performed Prior to Transfer; Agency Assistance C. [ §203 ] Escrow D. [ §204] Conveyance of Title E. [ §205] Condition of Title for the Conveyance F. [ 6206] Time for and Place of Delivery of Documents 0. [ §207] Title Insurance for the Conveyance H. [ §208] Taxes and Assessments (i) i I. [ §209] Environmental Matters J. [ §2101 Conditions Precedent to the Conveyance, Termination, Reimbursement K. [ §211] Land Use Entitlements III . [ §300] DEVELOPMENT OF THE SITE A. 1 §301] Development of the Site by the Developer 1. [ §302] Scope of Development 2. [§3031 Site Plan 3. [ 63041 Construction Drawings and Related Documents 4. [ §305] Cost of Construction 5. [§306] Construction Schedule 6. [ §307] Anti-Discrimination During Construction 7. [ §308] Bodily Injury and Property Damage Insurance B. [ §309] Certificate of Completion C. [ §3101 No Encumbrances Except Mortgages and Deeds of Trust D. 1 §3111 Holder Not Obligated to Construct Improvements E. [ 5312] Notice of Default to Mortgage or Deed of Trust Holders; Right to Cure F. [ §313 ] Failure of Holder to Complete Improvements G. [ §314] Right of the Agency to Cure Mortgage or Deed of Trust Default H. [ §315] Right of the Agency to Satisfy Other Liens on the Site After Title Passes IV. [ §400] USE OF THE SITE A. [ §401] Uses B. [ §4021 Maintenance of the Site (ii) C. [ 6403] Rights of Access D. [§404] Effect of Violation of the Terms and Provisions of this Agreement After Completion of Construction V. [ §500] GENERAL PROVISIONS A. [ §501] Notices, Demands and Communications Between the Parties B. [ §502] Conflicts of Interest C. [ §503] Enforced Delay; Extension of Times of Performance D. [ 6504) Nonliability of Officials and Employees of the Agency VI . [ §600] DEFAULTS AND REMEDIES A. [ §601] Defaults -- General B. [ §602] Legal Actions 1. [ §603 ] Arbitration 2. [ §604) Applicable Law 3. [ §605] Acceptance of Service of Process C. [ §606] Rights and Remedies Are Cumulative D. [ §607] Inaction Not a Waiver of Default E. [ §608] Remedies 1. [ §609] Damages 2. [ §610] Specific Performance 3. [ §611] Termination Resulting in Completion of Block 104 VII . [ §700] SPECIAL PROVISIONS A. 1 §701) Real Estate Commissions B. [ §702] Successors In Interest C. [ §703 ] Amendments to this Agreement (iii) D. [ §704] Attorney Fees E. [ §705] Release of Claims VIII. [ §800] ENTIRE AGREEMENT, WAIVERS ATTACHMENTS Attachment No. 1 Site Map Attachment No. 1-A Proposed Site Map Attachment No. 2 Legal Description Attachment No. 3 Scope of Development Attachment No. 4 Schedule of Performance Attachment No. 5 Cracchiola Grant Deed Attachment No. 6 Agency Parcels Grant Deed Attachment No. 7 Deed of Trust Attachment No. 8 Certificate of Completion Attachment No. 8-A Partial Certificate of Completion Attachment No. 9 Covenants for Block 105 Attachment No. 9-A Covenants for Block 104 Attachment No. 10 Guaranty Attachment No. 11 Property Owners Partnership Agreement Attachment No. 12 Equity Participation Procedure Attachment No. 13 Loan Schedules for Property Owners Attachment No. 14 Estimated Developer Costs on Block 104 (iv) DISPOSITION AND DEVELOPMENT AGREEMENT THIS AGREEMENT is entered into by and between the Redevelopment Agency of the City of Huntington Beach, a public body, corporate and politic, (the "Agency") and Coultrup Companies, a California corporation and Birtcher Real Estate Limited, a California limited partnership (the "Developer" ) . The Agency and the Developer hereby agree as follows: I. [ §100] SUBJECT OF AGREEMENT A. [ §101] Purpose _of_Agreement The purpose of this Agreement is to effectuate the Redevelopment Plan (as hereinafter defined) for the Main Pier Redevelopment Project by providing for the disposition and development of certain property bounded by Pacific Coast Highway, Main Street, Sixth Street and Walnut Avenue within the Project Area (the "Site") . The Site is depicted on the "Site Map", which is attached hereto as Attachment No. 1 and incorporated herein by this reference. The Site is to be developed, pursuant to this Agreement, for commercial and residential use, as described in more detail hereinafter in the Scope of Development attached hereto as Attachment No. 3 and incorporated herein by this reference (the "Project") . This Agreement is entered into for the purpose of expeditiously developing the Site and not for speculation in land holding. Completing the development on the Site pursuant to this Agreement is in the vital and best interest of the City of Huntington Beach, California (the "City" ) and the health, safety and welfare of its residents, and in accord with the public purposes and provisions of applicable state and local laws and requirements under which the Redevelopment Plan (as hereinafter defined) has been undertaken. B. [ §102] The Redevelopment Plan The Redevelopment Plan was approved and adopted by the City Council of the City of Huntington Beach by Ordinance No. 2578, as amended by Ordinance No. 2634; said ordinances and the Redevelopment Plan as so approved and amended (the "Redevelopment Plan") are incorporated herein by reference. C. [ §103] The Site The Site is that portion of the project area designated on the Site Map (Attachment No. 1) . The Site is composed of two separate blocks of property known as Block 104 and Block 105. Block 104 consists of the following parcels: 1. Six third party parcels owned separately by the general partners of the partnership which has Coultrup Companies as its managing partner and which by the terms of its Partnership Agreement attached hereto as Attachment No. 11, has committed to implement the obligations to develop Block 104 (the "Property Owner' s Parcels") ; 2. Two parcels owned by the Agency (respectively the "Agency Parking Parcels and the Agency Exchange Parcel"); 3. A portion of a public right-of-way to be vacated subject to the terms and conditions set forth herein (the "Alley") . Block 105 consist of: 1. Two parcels owned by Sarrabere-Wood and Goodman, tenants in common, (collectively the "Sarrabere-Wood-Goodman Parcels") ; 2. Seven parcels owned by the Agency (collectively the "Block 105 Agency Parcels") ; 3. A parcel owned by Frank, Dolores, Salvador and Barbara Cracchiolo (the "Cracchiolo Parcel") . Each of the foregoing enumerated parcels is designated on the Site Map (Attachment No. 1A) . The legal descriptions of each of the Parcels are attached hereto as "Attachment No. 2" and incorporated herein by this reference. Pursuant to this Agreement, each of the Parcels and the Alley shall be reconfigured into the Proposed Site Plan (Attachment No. 1B) pursuant to the procedures required by the City under the Subdivision Map Act (California Government Code §§ 66410 et seq. ) . D. [ §104] Parties to the Agreement 1. [ §105] The Agency The Agency is a public body, corporate and politic, exercising governmental functions and powers and organized and existing under Chapter 2 of the Community Redevelopment Law of the State of California. The principal office of the Agency is located at City Hall, 2000 Main Street, Huntington Beach, California 92648. 11/11/92 6449u/2460/009 -2- "Agency", as used in this Agreement, includes the Redevelopment Agency of the City of Huntington Beach, and any assignee of or successor to its rights, powers and responsibilities. 2. [ §106] The Developer The Developer is a joint venture with joint and several liability between Coultrup Companies, a California corporation, and Birtcher Real Estate Limited, a California limited partnership. The address of the Developer for the purposes of this Agreement is c/o Birtcher Real Estate Limited, 27611 La Paz Road, Laguna Niguel, California 92656 ( "Birtcher" ) and to Coultrup Development, P.O. Box 1270, Sunset Beach, California 90742 ("Coultrup") . The sole two exceptions to the joint and several liability of Coultrup and Birtcher are in the separate representations and warranties in Section 107 below and the separate obligation of Coultrup to return the Advance Assistance of One Hundred and Eighty Thousand Dollars to the Agency in the event of a termination of the Agreement by the Developer under the financing Contingency pursuant to Sections 202(18) and 210(2. ) (viii) . 3. [ §107] Representations and Warranties of the Parties A. Birtcher, to the best of its knowledge, represents and warrants to the Agency as follows: (i) Birtcher has duly authorized, executed and delivered this Agreement and any and all other agreements and documents required to be executed and delivered by the Developer prior to execution of this Agreement in order to carry out, give effect to, and consummate the transactions contemplated by this Agreement. (ii) Birtcher does not have any material contingent obligations or any material contractual agreements which could materially adversely affect the ability of the Developer to carry out his obligations hereunder. (iii) There are no known material pending or, so far as is known to Birtcher, threatened, legal proceedings to which the Developer is or may be made a party or to which any of its property is or may become subject, which has not been fully disclosed to the Agency which could materially adversely affect the ability of the Developer to carry out his obligations hereunder. (iv) There is no action or proceeding pending or, to 'Birtcher' s best knowledge, threatened, by or against the Developer which could affect the validity and 11/11/92 6449u/2460/009 -3- enforceability of the terms of this Agreement, or materially and adversely affect the ability of the Developer to carry out his obligations hereunder. (v) Birtcher has performed all of his obligations to be performed at or prior to the date of Developer' s execution of the Agreement in accordance with the Schedule of Performance and is not in default hereunder. Each of the foregoing items i to v, inclusive shall be deemed to be an ongoing representation and warranty. Birtcher shall advise the Agency in writing if there is any change pertaining to any matters set forth or referenced in the foregoing items i to v, inclusive. B. Coultrup, to the best of its knowledge, represents and warrants to the Agency as follows: (i) Coultrup has duly authorized, executed and delivered this Agreement and any and all other agreements and documents required to be executed and delivered by the Developer prior to execution of this Agreement in order to carry out, give effect to, and consummate the transactions contemplated by this Agreement. (ii) Coultrup does not have any material contingent obligations or any material contractual agreements which could materially adversely affect the ability of the Developer to carry out his obligations hereunder. (iii) There are no known material pending or, so far as is known to Coultrup, threatened, legal proceedings to which the Developer is or may be made a party or to which any of its property is or may become subject, which has not been fully disclosed to the Agency which could materially adversely affect the ability of the Developer to carry out his obligations hereunder. (iv) There is no action or proceeding pending or, to Coultrup' s best knowledge, threatened, by or against the Developer which could affect the validity and enforceability of the terms of this Agreement, or materially and adversely affect the ability of the Developer to carry out his obligations hereunder. (v) Coultrup has performed all of his obligations to be performed at or prior to the date of Developer' s execution of the Agreement in accordance with the Schedule of Performance and is not in default hereunder. 11/11/92 6449u/2460/009 -4- Each of the foregoing items i to v, inclusive shall be deemed to be an ongoing representation and warranty. Coultrup shall advise the Agency in writing if there is any change pertaining to any matters set forth or referenced in the foregoing items i to v, inclusive. C. The Agency, to the best of its knowledge, warrants and represents to the Developer as follows: (i) The Agency has duly authorized, executed and delivered this Agreement and any and all other agreements and documents required to be executed and delivered by the Agency prior to the execution of this Agreement in order to carry out, give effect to, and consummate the transactions - contemplated by this Agreement. (ii) The Agency does not have any known material contingent obligations or any known material contractual agreements which could materially adversely affect the ability of the Agency to carry out its obligations hereunder. (iii) There are no known material pending or threatened, legal proceedings to which the Agency is or may be made a party or to which any of its property is or may become subject, which has not been fully disclosed to the Developer which could materially adversely affect the ability of the Agency to carry out its obligations hereunder. (iv) There is no action or proceeding pending or, to the Agency' s best knowledge, threatened, looking toward the dissolution or liquidation of the Agency, and there is no action or proceeding pending or, to the Agency' s best knowledge, threatened by or against the Agency which could affect the validity and enforceability of the terms of this Agreement, or materially and adversely affect the ability of the Agency to carry out its obligations hereunder. (v) The Agency has performed all of its obligations to be performed at or prior to the date of Agency's execution of this Agreement in accordance with the Schedule of Performance and is not in default hereunder. Each of the foregoing items i to v, inclusive shall be deemed to be an ongoing representation and warranty. The Agency shall advise the Developer in writing if there is any change pertaining to any matters set forth or referenced in the foregoing items i to v, inclusive. At the Developer' s request Agency is accepting separate warranties and representations from Birtcher and Coultrup rather than obtaining combined representations and 11/11/92 6449u/2460/009 -5- warranties from each entity jointly, however, each of Coultrup and Birtcher agree to hold Agency harmless and provide the Agency a defense in the event of any claim or litigation between Birtcher and Coultrup alleging a breach or misrepresentation of Birtcher' s or Coultrup' s representations and warranties. 4. [ §108] The Guarantors The "Guarantors" are Birtcher Real Estate Limited and Jon Coultrup, an individual. The Guarantors will benefit materially by the execution of this Agreement. Prior to and as a condition of the Conveyance of the Agency Block 105 Parcels (as set forth in Section 201 hereof) the Guarantors shall execute and deliver to the Agency the guaranties of each and every obligation of the Developer pursuant to this Agreement in the form of the "Guaranty" which is attached hereto as Attachment No. 10 and is incorporated herein by reference. The parties agree and acknowledge that the delivery of the Guaranty by the Guarantor is a material inducement for the Agency to convey the Site to the Developer, and that but for the provision of such Guaranty, the Agency would not execute this Agreement or convey the Agency Block 105 Parcels to the Developer. The guaranties are for the sole benefit of the Agency and the City or any successors to their interests and are not intended to be for the benefit of any other party. S. [ §109] Prohibition Against Change in Ownership, Management and Control of Developer The qualifications and identity of the Developer are of particular concern to the City and the Agency. It is because of those qualifications and identity that the Agency has entered into this Agreement with the Developer. No voluntary or involuntary successor in interest of the Developer shall acquire any rights or powers under this Agreement except as expressly set forth herein. The Developer shall not assign or transfer all or any part of this Agreement or the Site or any rights hereunder prior to the issuance of a Certificate of Completion as defined in Section 309 of this Agreement without obtaining the prior written approval of the Agency. Written approval of the Agency shall also be required prior to any and all changes whatsoever in the identity of the Developer' s general partners or in the individual or entity holding the controlling share of equity in the Developer entity. Any purported transfer, voluntary, involuntary, or by operation of law, except with the prior written consent of the Agency, shall constitute a default of the Developer and shall render this Agreement absolutely null and void and shall confer no rights whatsoever upon any purported assignee or transferee. 11/11/92 6449u/2460/009 -6- All of the terms, covenants and conditions of this Agreement shall be binding upon and shall inure to the benefit of the Parties and the permitted successors and assigns of the Parties. Whenever the term "Developer" or "Agency" is used herein, such term shall include any other permitted successors and assigns as herein provided. Notwithstanding the foregoing, Birtcher and Coultrup anticipate the formation of a partnership to act as Developer hereunder in which each party will have an affiliate act as a general and/or limited partner. Upon the formation of such development entity and the request of such development entity, the Agency agrees to consent to the assignment of all of the right, title and Interest of Birtcher and Coultrup pursuant to the terms of this DDA to such development entity. Such consent shall not be unreasonably withheld but shall be subject to the Guarantors continuing to remain in place or being replaced by substituted Guarantors as the Agency may approve in its discretion. Furthermore, it is anticipated that a general or limited partnership may be formed between the development entity described in the preceding paragraph and another entity who will act as an equity participant in the Project. Upon the formation of such entity and the request of such entity, the Agency agrees to consent to the assignment of all of the right, title and interest of the Developer pursuant to the terms of this DDA to such entity. Such consent shall not be unreasonbly withheld but shall be subject to the Guarantors continuing to remain in place or being replaced by substituted Guarantors as the Agency may approve in its discretion. Upon the issuance of the Certificate of Completion, attached hereto as Attachment No. B and incorporated herein by this reference, pursuant to Section 309 of this Agreement, this Section 109 shall be of no further force or effect. 6. [ §110] Transfer of Limited Partnership Interest; Indemnity Coultrup Companies is the managing partner in the partnership agreement, an executed copy of which is attached hereto as Attachment No. 11 and incorporated herein by this reference (the "Property Owners Agreement" ) . The Property Owners Agreement provides for the ability of the partnership to carry out all responsibilities concerning construction and development of each property owner' s property. The Developer shall become the managing partner of the Property Owners Partnership within one hundred and twenty (120) days of the execution of this Agreement by the Agency. 11/11/92 6449u/2460/009 -7- The Developer shall indemnify, hold harmless and defend the Agency and/or the City from any claim, cause of action or suit arising out of or relating to the Property Owners Partnership Agreement and the terms, conditions, responsibilities and obligations between the parties thereto. Such limitations shall not relate to claims made and to Agency actions or responsibilities under this Agreement. 7. [ 5111] Good Faith Deposit Prior to execution of this Agreement by the Agency, Developer has previously deposited Twenty Thousand Dollars ($20,000) with the Agency. The deposit shall be returned to Developer simultaneously with the Advance Assistance in Section 202(18. ) herein. 8. [ 6112] Relationship of Agency and Developer It is hereby acknowledged that the relationship between the Agency and the Developer is not that of a partnership nor a joint venture and that the Agency and the Developer shall not be deemed or construed for any purpose to be the agent of the other. II . [ §200] ASSEMBLY OF THE SITE A. [ §201] Agency Acquisitions 1. Acquisition of Sarrabere-Wood-Goodman Parcels Provided that the Developer is not otherwise in default hereunder, within the time set forth in the Schedule of Performance, the Agency shall, after attempting to acquire by negotiation, conduct a hearing to consider the adoption of a resolution of necessity in its sole discretion, as the initial step to determine whether to acquire the Sarrabere-Wood-Goodman Parcels by exercise of its power of eminent domain. If the Agency adopts a resolution of necessity and elects to exercise its power of eminent domain, such election shall be made and the eminent domain action(s) filed within the time set forth in the Schedule of Performance; provided, that nothing in this Agreement shall. be deemed to constitute a commitment by Agency to condemn1 property or a prejudgment of the matters required to be considered as part of any decision to condemn property. In the event Agency determines to adopt the resolution of necessity the Agency shall provide the Acquisition Cost funds, as defined below including the offer amount, based on the appraisal, which must be filed with the court at the time the eminent domain action is filed in order to apply for the order of immediate possession. A determination not to adopt a resolution' of necessity shall provide additional grounds for termination of this Agreement by the Agency or Developer under Sections 210 or 211 herein. ' 11/11/92 6449u/2460/009 -8- Upon Agency acquisition of any of the individual parcels or property interests comprising the Sarrabere-Wood-Goodman Parcels, the Agency and Developer agree that said parcels shall be conveyed to the Developer within the time set forth in the Schedule of Performance (Attachment No. 4) and said property interests shall be terminated, and the Agency and Developer shall cooperate and execute any documents required to effect such conveyance(s) and to remove said property interests of record. In the event that the Agency exercises its power of eminent domain to acquire the Sarrabere-Wood-Goodman Parcels, the Agency shall, upon the Developer's written request, exercise its best efforts to obtain a judicial order or orders - (hereinafter "Order of Prejudgment Possession" ) authorizing the Agency to take possession of the premises prior to the final order(s) of condemnation. Notwithstanding any other provision of this Agreement to the contrary, if, at the time of the close of escrow for the transfer of the Block 105 Agency Parcels to the Developer, the Agency provides to the Developer a copy of an Order of Prejudgment Possession for all of the individual parcels or property interests comprising the Sarrabere-Wood-Goodman Parcels, and: (i) The right to take is not an outstanding issue as either being waived, settled or finally decided with the appeal period having ellapsed; (ii) Agency delivers possession of the premises which are the subject of the Order of Prejudgment Possession; (iii) Agency is diligently proceeding with eminent domain action(s) seeking the rendering of a final judgment or judgments, which judgment or judgments would authorize the taking, and the Agency agrees to convey fee title to the parcel or terminate the property interest, as applicable, when Agency completes the acquisition; and (iv) The right of possession conveyed by the Agency to the Developer is sufficient to enable the Developer to obtain a title insurance policy as necessary to close its construction and permanent loans for the development of the Site; then, the Developer shall accept such right of possession and proceed with the development of the Site, with the date of transfer of possession from the Agency to the Developer treated 11/11/92 6449u/2460/O09 -9- the same as the date of close of escrow for purposes of the Developer' s obligation to proceed with and complete construction. Upon the request of the Title Company, the Agency shall execute an indemnification agreement in form satisfactory to such Title Company and reasonably satisfactory to the Agency by which the Agency shall agree to indemnify the Title Company for any losses, damages and expenses incurred by the Title Company in the event of the Agency' s abandonment of the eminent domain proceedings. Nothing herein shall be deemed to obligate the Agency to pay for any additional premium or other charge necessary for the issuance of said title policy. In the event that no title insurance company will issue a standard ALTA (CLTA) policy in a form with exceptions that will not effect the ability of the Developer to complete the project, the .Developer' s obligation to commence and complete construction shall be delayed until either a reasonably acceptable title policy is obtained or the Agreement is terminated. The term "Acquisition Costs" as used herein shall mean all costs reasonably incurred by the Agency for acquisition of any of the individual parcels and property interests comprising the Sarrabere-Wood-Goodman Parcels. The Agency' s Acquisition Costs shall include, but not be limited to, costs for real estate purchases and option agreements, escrow fees and charges, title insurance, relocation expenses, court judgments, court costs, attorney' s fees, appraisal fees, and expert witness fees. 2. Acquisition by Exchange of Cracchiolo Parcel Agency and Cracchiolo have agreed to an even exchange (equity for equity with each parcel to be delivered free and clear of all liens and encumbrances) of the Agency Exchange Parcel on Block 104 and the Cracchiolo Parcel on Block 105. The escrow on this exchange is to close prior to the transfer of the Agency Block 105 parcels to Developer. Cracchiolo has been informed that in the event he is unwilling to complete the described exchange that the Agency would be forced to schedule a hearing to consider the adoption of a resolution of necessity to condemn his property. Prior to the exchange, Elden Bagstad shall deed a ten foot wide north westerly strip of Lot 8, Block 104 property to the Agency and the Agency shall deed a ten foot wide north westerly strip of Lot 6, Block 104 to Elden Bagstad. In the event that the Agency determined it was necessary to proceed with an eminent domain action the Developer would bear all Acquisition Costs as defined in paragraph 1 above and provide cash or a letter of credit in an amount of one hundred and fifty percent (150%) of the appraised 11/11/92 6449u/2460/009 -10- value of the Cracchiolo Parcel in advance of the filing of the eminent domain action. 3. Acquisition of Property Owners Parcels The Property Owners have agreed pursuant to their Property Owners Agreement (Attachment No. 11) to cooperate with all actions necessary for 'the Developer to perform the responsibilities of the Developer related to Block 104. The Property Owners have been informed that in the event any one of them is unwilling to cooperate with the Developer the Agency would be forced to schedule a hearing to consider the adoption of a resolution of necessity to condemn their property. In the event -the Agency determined it was necessary to proceed with an eminent domain action, all Acquisition Costs as defined in paragraph 1 above shall be borne by Developer and Developer shall provide cash or a letter of credit in an amount of one hundred and fifty percent (1S0%) of the appraisal value of the particular Property Owner' s Parcel in advance of the filing of the eminent domain action. B. [ §202] Disposition of Agency Block 105 Parcels;- Actions to be Performed Prior to Transfers; Agency Assistance Subject to applicable terms and conditions of this Agreement, the Agency agrees to provide Agency Assistance as described below, and to sell the Agency Parcels and the Sarrabere-Wood-Goodman Parcels and the Cracchiola Parcel to the Developer and the Developer shall purchase the Agency Parcels, the Sarrabere-Wood-Goodman Parcels and the Cracchiolo Parcel from the Agency. The purchase price for the Agency Parcels, the Sarrabere-Wood-Goodman Parcels and the Cracchiola Parcel shall be equal to the amount of One Million Eight Hundred Thousand Dollars ($1,800,000) plus an equity share interest as defined in the Equity Participation Procedure attached hereto and incorporated herein by this reference as Attachment No. 12 (the "Purchase Price") . After the close of escrow the Agency shall be responsible for any additional Acquisition Costs for acquiring the Sarrabere-Woad-Goodman Parcels including the judicially determined purchase price as determined to be the fair market value of the property. Developer would remain responsible for all eventual costs for any eminent domain actions for the Cracchiolo Parcel or other Property Owner Parcels. The conveyance from the Agency to the Developer of the Agency Parcel(s) and the Sarrabere-Wood-Goodman Parcel(s) is subject to the following terms and conditions: 11/11/92 6449u/2460/009 -11- 1. Acquisition of Complete Site. The Agency shall have acquired all of the individual parcels and property interests comprising the Sarrabere-Wood-Goodman and Cracchiolo Parcels (or the Agency shall have obtained an Order of Prejudgment Possession and any issue as to right to take shall be finally resolved for any of such parcels or property interests for which fee title has not yet been obtained, with such Order meeting the requirements of Section 201 above) ; . 2. Acceptance of Title Policies. Developer approved preliminary title policies to Agency Block 105 Parcels and the Sarrabere-Wood-Goodman Parcels and the Cracchiolo Parcel. 3. Vacation of Alley. The City Council shall have adopted its resolution conditionally approving vacation of the Alley, as referenced in Section 201 above, with such vacation(s) to be effective concurrently with the close of the escrow for the Agency Parcels; 4. Subdivision; Conditional Use Permit and Coastal Commission .Approval. Developer and Agency will cooperate in applications to City under the applicable subdivision approval requirements for reconfiguration of the parcels comprising the Site, vacation of the Alley and for any necessary conditional use permits. Developer shall be responsible for preparing and processing such applications and paying all application fees. The final tract map shall be recorded concurrently with Agency' s transfer to Developer of the Block 105 Agency Parcels and the Sarrabere-Wood-Goodman Parcels. Developer and Agency shall be satisfied with all conditions placed on the conditional use permit. In the event of an appeal of the project to the Coastal Commission, Developer shall be responsible for preparing and processing such appeal. The final approval shall be in a form acceptable to Agency and Developer. Such approval must be obtained by Coastal Commission prior to the transfer of the parcels. 5. Financing; Submittal of Evidence of Financing Commitments. A minimum of sixty (60) days prior to the conveyance of the Agency Parcels and the effective date of the City' s resolution vacating the portions of the Alley, the Developer shall submit to the Agency' s Executive Director evidence reasonably satisfactory to the Executive Director that the Developer has obtained the construction financing necessary for the development of the Project on the Site. Such evidence shall include documentation of each limited partner's 11/11/92 6449u/2460/009 -12- financing for the construction on their individually-owned parcel. Such evidence of construction financing shall include the following: a. A copy of the commitment or commitments obtained by the Developer for the mortgage loan or loans (both for interim construction financing) to assist in financing the construction of the Project (as defined in the Scope of Development (Attachment No. 3) ) , certified by the Developer to be a true and correct copy or copies thereof. The commitments for financing shall be in such form and content acceptable to the Executive Director as reasonably evidences a firm and enforceable commitment, with only those conditions which are standard or typical for the lender(s) involved for similar projects; and b. Sufficient information (e.g. , an annual report) regarding the construction, interim and/or permanent lenders to enable the Executive Director to determine whether or not such lender(s) has (have) sufficient financial resources to fund the loan(s); and C. A financial statement and/or other documentation satisfactory to the Executive Director as evidence of other sources of capital, including a fifteen percent (15%) of construction costs equity contribution from Developer, sufficient to demonstrate that the Developer has adequate funds committed by itself or otherwise to cover the difference, if any, between construction and development costs minus financing authorized by mortgage loans; and d. A copy of the contract between the Developer and each general contractor for the construction of both portions of the Project, certified by Developer to be a true and correct copy thereof. Within fifteen (15) days after receipt of the Developer' s request for approval of its evidence of construction financing, the Executive Director shall respond in writing by stating what further information, if any, the Executive Director reasonably requires in order to determine whether or not to approve such evidence of financing. Upon receipt of such a timely response, the Developer shall promptly furnish to the Executive Director such further information as may be reasonably requested. 11/11/92 6449u/2460/009 -13- The Executive Director shall reasonably approve or disapprove the Developer' s evidence of construction financing within fifteen (15) days after the Developer' s request for such approval is accepted' as complete. If the Executive Director disapproves any such evidence of financing, written notice shall be provided to the Developer stating the reasons for such disapproval. 6. Project Design; Design and Construction Costs; Agency Assistance. Subject to the costs to be incurred by the. Agency pursuant to this Agreement, Developer shall, at his sole cost and expense, design and construct the Project pursuant to the Scope of Development (Attachment No. 3) , as an approximately 80 to 90 unit residential condominium building on Block 105 and a up to three-story commercial office/retail buildings totaling approximately 47, 500 square feet on Block 104. Exact number of units and conditions on Project may be subject to change during the • . entitlement process with the City. Plan application by Developer shall be submitted to and accepted by the City planning department as complete within ninety (90) days of the execution of this Agreement. The Developer shall select, oversee and coordinate either a single general contractor for all of the work proposed for Block 104 and Block 105 or one for each. Construction shall be initiated on Block 104 by September 15, 1994. The Developer and the Agency shall provide dedications necessary to construct the Project from their respective Parcels at their expense. Developer shall be responsible for obtaining. any such necessary dedications from the Property Owners Parcels. 7. Soils Remediation. Parties understanding with respect to soils remediation and obligations is set out in Section 209 below. 8. Parking. Agency shall provide non-exclusive public ground level parking spaces located in Block 104. Any charges for use (i . e. , meter costs, etc. ) made to the general public shall be equally applicable to the property owners. Both parties understand that it is the intent of the City to amend its Downtown Specific Plan to allow the proposed commercial uses on Block . 104 to be sufficiently parked by existing parking in the downtown area and the ground level spaces planned for the Agency owned parcel on Block 104. Both' parties also understand that such an amendment to the Downtown Specific Plan requires approval by the Coastal Commission. In the event the City is .not successful in amending the Downtown Specific Plan to 11/11/92 6449u/2460/009 -14- allow for the proposed commercial project to be fully parked without the need for spaces aside from the ground .level spaces shown on CUP No. 92-17, then the Agency shall have the right to terminate this Agreement. Developer shall provide all parking required by the City for the Block 105 Improvements and shall pay all costs associated with the construction of such parking facilities. 9. Public Improvements. Developer shall pay for all of the Block 105 onsite and offsite improvements as described in 'the Scope of Development (Attachment No. 3) with the exception. of those curb, gutter and street improvements fronting the Worthy Parcel. Agency payment toward the Worthy Parcel shall not include sewer, utility, storm drain, traffic impact, or fees associated with the street improvements. The Agency shall either initiate the construction of the Block 104 offsite improvements as described in the Scope of Development (Attachment No. 3) within thirty (30) days of issuance of the first building permit for Block 104 or shall reimburse the Developer after review and written -approval by Public Works Director, of City of: (i) three bids, (ii) all contracts, (iii) detailed invoices, and (iv) proof of lien releases from subcontractors for those verified costs. Developer shall be responsible for construction and payment of all onsite improvements to Block 104. Agency shall provide utility hook-up to each parcel of Block 104. Agency shall provide costs for construction work necessary for any on-site publicly owned right-of-ways. 10. Relocation. Agency shall pay towards relocation expenses, inclusive of any claim for goodwill or costs associated with relocation of residential tenants, of the. Property Owners' Three Hundred and Eighty Thousand Dollars ($380,000) . Agency shall provide counseling and relocation assistance to tenants, said costs to be deducted from the' Three Hundred and Eighty Thousand Dollars ($380,000) prior to payments to Property Owners. Remaining amounts shall be distributed according to the following schedule: one-third (1/3) upon pulling demolition permit; one-third (1/3) upon obtaining framing check off approval by' building official; and the final one-third (1/3) upon issuance of certificate of occupancy. Amounts to be distributed shall be based' in proportion to the amounts set out in the Property Owners Partnership Agreement (Attachment No. 11) . Any additional amounts shall be paid by Developer. In addition the Agency shall provide counseling and relocation assistance to il/11/92 6449u/2460/009 -15- the following commercial tenants: Papa Joes, Mike' s Surf & Sport and Taxis. Developer agrees to indemnify, defend and hold harmless Agency and City from any claims for relocation, goodwill, loss of business profits or other damages brought by existing tenants or owners and arising out of or relating to the implementation of this Agreement. 11. Development Fees. For a period of six months after final approval by Coastal Commission of the revised Downtown Specific Plan, Agency shall pay to the City the difference between City development fee amounts applicable as of the date of execution of this Agreement and any increases in said fees up to a maximum amount of Two Hundred Thousand Dollars ($200,000) . Said fees shall include, but not be limited to, traffic impact fees. Said fees do not include fees imposed by other public entities such as school impact fees and sewer fees. After the expiration of the six month period Developer is responsible for the full cost of such fees. 12 . Deed of Trust. A Deed of Trust substantially in the form of Attachment No. 7 shall be executed for recordation on Block 105 properties securing the Developer' s performance under this Agreement in an amount equal to the Agency' s total costs incurred under this Agreement and payment of the "Equity Share Amount. " 13. Equity Share Terms. Developer and Agency agree that a portion of the Purchase Price for the Agency Parcels shall be determined at the time of sale of the individual residential units on Block 105 as provided in the Equity Participation Procedure (Attachment No. 12) . 14. Affordable Housing. Agency shall provide replacement housing units as required by law and shall assure that a minimum of twelve (12) units of affordable housing are provided consistent with Community Redevelopment law. Agency shall have the right to designate twelve units as affordable to low and moderate use pursuant to the guidelines of the City' s requirement. Such designation shall not effect the market price of the unit to the Developer as the Agency' s low to moderate housing funds shall be utilized to make the unit affordable to the designated eligible family or individual. 15. Demolition of Block 104. The existing commercial structures on Block 104 shall be demolished at Developer' s cost pursuant to a City approved 11/11/92 6449u/2460/009 -16- demolition plan prior to transfer of the Agency Parcels and Sar`rabere-Wood-Goodman Parcels. 16. Early Demolition and Grading of Block 10.5. Block 105 demolition and site grading and protective foundation work solely for purposes of water proofing may occur if the' Agency Executive Director authorizes the issuance of an encroachment permit prior to the transfer of the Agency Parcels and Sarrabere-Wood-Goodman Parcels if all conditions precedent listed in Section 210 herein have been satisfied only excepting (x) . 17. Permanent Financing Assistance. Agency agrees- to provide the Property Owners financing assistance in the event a particular Property Owner is unable to secure permanent fifteen-year fully amortized financing commitment at eight percent (8%) or less per-' annum with fees of three points or less. The Agency shall provide up to the present value calculated to provide a gap payment of such amount needed to bring the loan down to. eight (8) percent but in no event greater than two percent (2%) interest. For example, a ten (10) percent fifteen year loan with three points would be paid down to eight (8) percent but a twelve (12) percent fifteen year loan would be paid down to. ten (10) percent. A seven (7) percent fifteen year loan at three points would receive no assistance. A schedule of the individual Property Owners loan amounts entitled is attached hereto as Attachment No. 13 and incorporated herein by this reference. Agency shall have the right to deal directly with the Property Owners' Lender to negotiate and arrange the financing assistance package. 18. Agency Assistance Advance. Within thirty (30) days of. 'the execution .of this Agreement, Agency shall advance an amount equal to One Hundred .Eighty Thousand Dollars ($180, 000) (the "Advance Assistance" ) plus the return of the Twenty Thousand Dollars ($20,000) deposit to Developer to be used to assist in. predevelopment costs incurred by the Developer. Prior to" any payment of Advance Assistance, Developer shall provide Agency staff with documentation to their sole satisfaction verifying said predevelopment costs and evidencing that the costs were incurred during the period from July 15, 1991 to November 16, 1992 . Only costs accepted by staff as verified which occurred during that time period shall be paid even if the amount of verified costs is less than One Hundred and Eighty Thousand ($180,000) . The Advance Assistance shall be repaid to the Agency either out of the loan proceeds to finance construction of Block 105 concurrently with 11/11/92 6449u/2460/009 -17- the purchase by the Developer of the Block 105 Agency Parcels or in the event of a Developer termination under the financing contingency Coultrup and his successors in interest shall be solely responsible for repayment of the Advance Assistance. Birtcher shall have no liability or responsibility for the return of the Advance Assistance. Notwithstanding .anything to the contrary set forth in this Agreement, the Agency shall have no obligation to transfer the Agency Parcels or to provide and pay any amounts of other Agency Assistance (with the exception of the Advance Assistance as provided in subparagraph 18 above) as hereinabove set forth unless all of the "Agency' s Conditions Precedent to the Conveyance" (as hereafter defined in Section 210 of this Agreement) have been satisfied or waived by Agency in its sole and absolute discretion. C. [ §203 ] Escrow The Agency agrees to open an escrow (the "Escrow" ) with a mutually agreeable escrow company (the "Escrow Agent" ) , by the time established therefor in the Schedule of Performance (Attachment No. 4) . The Escrow Agent shall accomplish the recordation of the Agency Parcels Grant Deed, which is attached hereto as Attachment No. 6 and incorporated herein by this reference, the Deed of Trust, which is attached hereto as Attachment No. 7 and incorporated herein by this reference, and the Covenants, which is attached hereto as Attachment No. 9 and incorporated herein by this reference, all as more particularly set forth herein. This Agreement constitutes the joint basic escrow instructions of the Agency and the Developer for the conveyance of the Agency Parcels and a duplicate original of this Agreement shall be delivered to the Escrow Agent upon the opening of the Escrow. The Agency and the Developer shall provide such additional escrow instructions as shall be necessary for and consistent with this Agreement. The Escrow Agent is hereby empowered to act under this Agreement, and the Escrow Agent, upon indicating within five (5) days after the opening of the Escrow its acceptance of the provisions of this Section 203, in writing, delivered to the Agency and the Developer, shall carry out its duties as Escrow Agent hereunder. Upon delivery of the Agency Parcels Grant Deed (Attachment No. 6) to the Escrow Agent by the Agency and the Deed of Trust (Attachment No. 7) and the Covenants (Attachment No. 9) by the Developer pursuant to Section 205 of this Agreement, the Escrow Agent shall record such deeds when title can•be vested respectively in the Developer and the Agency in accordance with the terms and provisions of this Agreement. The Escrow Agent shall pay any applicable transfer tax. Any insurance policies covering the Agency Parcels . or any parcel are not to be transferred. 11/11/92 6449u/2460/009 -18- The Developer and the Agency shall pay in escrow to the Escrow Agent all fees, charges and costs as those costs are customarily paid by a buyer and seller of property as to their respective roles with the Agency Parcels and the Sarrabere-Wood-Goodman Parcels promptly after the Escrow Agent has notified the Developer and the Agency of the amount of such fees, charges and costs, but not earlier than ten (10) days prior to the scheduled date for closing the Escrow, including, without limitation, the following: 1. Costs necessary to place title to the Agency Parcels and the Sarrabere-Wood-Goodman Parcels in the condition for conveyance pursuant to Section 205 of this Agreement; 2. The escrow fee; 3. Cost of drawing the deeds; 4. • Recording fees; 5. Notary fees; 6. Any State, County or City documentary stamps; 7. Any transfer tax; 8. The premium for title insurance as set forth in Section 207 of this Agreement; and Under verification that all conditions precedent under Section 210 of this Agreement have been satisfied or waived by the appropriate party or parties, the Escrow Agent is authorized to: 1. Pay, and charge the Developer and the Agency for any fees, charges and costs payable under this Section 203 of this Agreement. Before such payments or charges are made, the Escrow Agent shall notify the Developer and the Agency of the fees, charges and costs necessary to clear title and close the Escrow. 2. Deliver the deeds and other documents to the parties entitled thereto when the conditions of this Escrow have been fulfilled by the Agency and the Developer. 3. Record the Deeds of Trust (Attachment No. 7) securing Developer' s performance obligations required pursuant to this Agreement, and any other instruments delivered through this Escrow, if necessary or proper, to comply with the terms 11/11/92 6449u/2460/009 -19- and conditions of this Agreement and vest title in the Developer in accordance with the terms and provisions of this Agreement. All funds received in this Escrow shall be deposited by the Escrow Agent, with other escrow funds of the Escrow Agent in an interest earning general escrow account or accounts with any state or national bank doing business in the State of California. Such funds may be transferred to any other general escrow account or accounts. All disbursements shall be made by check of the Escrow Agent. All adjustments are to be made on the basis of a thirty (30) day month. If this Escrow is not in condition to close on or before the time for conveyance established in the Schedule of Performance (Attachment No. 4) of this Agreement, either party who then shall have fully performed the acts to be performed before the conveyance of title may, in writing, demand from the Escrow Agent the return of its money, papers or documents deposited with the Escrow Agent. No demand for return shall be recognized until ten (10) days after the Escrow Agent shall have mailed copies of such demand to the other party or parties at the address of its or their principal place or places of business. Objections, if any, shall be raised by written notice to the Escrow Agent and to the other party within the ten (10) day period, in which event the Escrow Agent is authorized to hold all money, papers and documents with respect to the Agency Parcels until instructed by a mutual agreement of the parties or by a court of competent jurisdiction. If no such demands are made, the Escrow shall be closed as soon as possible. The Escrow Agent shall not be obligated to return any such money, papers or documents except upon the written instructions of both the Agency and the Developer or until the party entitled thereto has been determined by a final decision of a court of competent jurisdiction. Any amendment to these Escrow instructions shall be in writing and signed by both the Agency and the Developer. At the time of any amendment, the Escrow Agent shall agree to carry out its duties as Escrow Agent under such amendment. All communications from the Escrow Agent to the Agency or the Developer shall be directed to the addresses and in the manner established in Section 501 of this Agreement for notices, demands and communications between the Agency and the Developer. The liability of the Escrow Agent under this Agreement is limited to performance of the obligations imposed upon it under Sections 202 to 210, both inclusive, of this Agreement. 22/11/92 6449u/2460/009 -20- . D. [ §204] Conveyance of Title Subject to any extensions of time mutually agreed upon between the Agency and the Developer, conveyance of title to the Block 105 Agency Parcels, Sarabere-Wood-Goodman Parcels and the Cracchiolo Parcel shall be completed on or prior to the date specified therefor in the Schedule of Performance (Attachment No. 4) . Said Schedule of Performance (Attachment No. 4) is subject to revision from time to time as mutually agreed upon in writing between the Developer and the Executive Director of the Agency. E. [ §205] Condition of Title for the Conveyance The Agency shall convey title to the Block 105 Agency Parcels, the Sarabere-Wood-Goodman Parcels, the Cracchiolo Parcel and the Alley free and clear of encumbrances except the dedications shown on the Site Map (Attachment No. 1) and otherwise as may hereafter be expressly approved by the Developer in its reasonable discretion in light of the proposed use of the property and lender requirements. F. [ §206] Time for and Place of Delivery of Documents Subject to any mutually agreed upon extension of time, the Agency Parcels Grant Deed (Attachment No. 6) , the Deed of Trust (Attachment No. 7) and the Covenants (Attachment No. 9) , shall be executed, acknowledged, and delivered to the Escrow Agent on or before the date established for the date for the Conveyance pursuant to the Schedule of Performance (Attachment No. 4) . G. [ §207] Title Insurance for the Conveyance Concurrently with recordation of the Grant Deeds (Attachment Nos. 5 and 6) , the Title Company shall provide and deliver to .Developer, at Agency' s sole cost and expense, standard coverage ALTA (CLTA) title insurance policies issued by the Title Company insuring that the title to the Site is vested in Developer in the condition required by Section 205 of this Agreement. The Title Company shall provide the Agency with duplicate policies. The policies shall be in the amount of the Purchase Price for each parcel. All additional costs incurred for or related to such title insurance shall be borne solely by the Developer, including, but not limited to, coverage in excess of the Purchase Price for each parcel, additional endorsements, or an ALTA extended coverage policy. H. [ §208] Taxes and Assessments Ad valorem taxes and assessments, if any, on the Block 105 Agency Parcels, the Sarabere-Wood-Goodman Parcels and the Cracchiolo Parcel levied, assessed or imposed for any period 11/11/92 6449u/2460/009 -21- commencing prior to conveyance of title to the Developer shall be borne by the Agency. I . [ §209] Environmental Matters 1. Definitions For the purposes of this Section 209, the following terms shall have the meanings herein specified: (a) The term "Hazardous Materials" shall mean (i) any "hazardous substance" as defined by the Comprehensive Environmental Response, Compensation and Liability Act of 1980 (42 U.S.C. Section 9601 et seg. ) , as amended from time to time, and regulations promulgated thereunder; (ii) any "hazardous substance" as defined by the Carpenter-Presley-Tanner Hazardous Substance Account Act (California Health and Safety Code Sections 25300 et seg. ) , as amended from time to time, and regulations promulgated thereunder; (iii) asbestos; (iv) polychlorinated biphenyls; (v) petroleum, oil, gasoline (refined and unrefined) and their respective by-products and constituents; and (vi) any other substance, whether in the form of a solid, liquid, gas or any other form whatsoever, which by any "Governmental Requirements" (as defined in Subparagraph (c) of Paragraph 1 of this Section 209) either requires special handling in its use, transportation, generation, collection, storage, handling, treatment or disposal, or is defined as "hazardous" or harmful to the environment. (b) The term "Hazardous Materials Contamination" shall mean the contamination (whether presently existing or hereafter occurring) of the improvements, facilities, soil, groundwater, air or other elements on, in or of the Site by Hazardous Materials, or the contamination of the buildings, facilities, soil, groundwater, air or other elements on, in or of any other property as a result of Hazardous Materials at any time (whether before or after the date of this Agreement) emanating from the Site. (c) The term "Governmental Requirements" shall mean all laws, ordinances, statutes, codes, rules, regulations, orders and decrees of the United States, the state, the county, the city, or any other political subdivision in which the Site is located, and of any other political subdivision, agency or instrumentality exercising jurisdiction over the Agency, the Developer or the Site. 2. Environmental Site Evaluation As soon as possible following the execution of this Agreement, the Developer and Agency shall cause the investigation of the environmental condition of their respective portions of the Site, at their respective cost and 11/11/92 6449u/2460/009 -22- PP7 expense. Such investigation shall include such activities as the environmental consultant or expert retained to perform such investigation (the "Environmental Consultant" ) deems necessary or appropriate to determine the environmental condition of the Site, but in any case, including preparation of at least a Phase 1 report for the Site. If the Developer determines that testing beyond Phase I is necessary, such testing shall be the Developer' s expense. Both parties shall deliver to each other a copy of all reports and test results. Developer and Agency shall each bear any remedial cost associated with hazardous material contamination of or caused by as certified and proof provided by an engineers report acceptable to both parties of their respective parcels (the "Cleanup Costs" ) , which shall not exceed Two Hundred Thousand Dollars ($200,000) for the Agency and One Hundred and Twenty-Five Thousand ($125,000) for the Developer (the "Maximum Cleanup Costs" ) . Included in the Developer' s responsibilities are all such costs with respect to the Property Owners Parcels and the Cracchiola Parcel. For the Agency, the Maximum Cleanup Cost shall be comprised of an initial One Hundred Thousand Dollar ($100, 000) amount (the "Nonrecoverable Amount") and a One Hundred Thousand Dollar ($100,000) amount (the "Recoverable Amount" ) . If the Agency expends funds of the Recoverable Amount, said funds shall be reimbursed from gross profits prior to calculations of net profits pursuant to Section 201 herein. The Agency shall pay any necessary Cleanup Costs for the Sarrabere-Wood-Goodman Parcels as a separate obligation from the Maximum Cleanup Costs up to an amount equal to One Hundred Thousand Dollars ($100,000) . In the event that the cleanup costs on Sarrabere-Wood-Goodman Parcels exceed the One Hundred Thousand Dollar cap and are not offset on the condemnation evaluation of fair market value or the negotiated purchase price, said additional amount shall count toward the Agency' s Nonrecoverable, Recoverable and Maximum Cleanup Costs. 3 . Right of Termination for Contamination The Developer and the Agency shall each have the right to terminate this Agreement if the Cleanup Costs for their respective parcels are expected to exceed the Maximum Cleanup Cost of Two Hundred Thousand for Agency or One Hundred and Twenty-Five Thousand for Developer. Developer shall have the option to elect to pay Agency Cleanup Costs in excess of Two Hundred Thousand Dollars ($200,000) . Agency shall have the right to pay Developer Clean Up Costs in excess of One Hundred and Twenty Five Thousand ($125,000) . Termination of the Agreement pursuant to this provision (if after the conveyance of title) shall require the reconveyance of all of the Block 105 property to the Agency and a repayment of the Purchase Price to the Developer. In the event of termination under this Section, Developer shall retain the Advance Assistance but in no event shall either party owe any other claim for 11/11/92 6449u/2460/009 -23- reimbursement or loss arising out of or relating to this Agreement. 4. Obligation of Developer to Remediate the Site Subject to the right of termination in Paragraph 3 above, after transfer of title pursuant to Section 204 and notwithstanding the obligation of Developer to indemnify Agency pursuant to Paragraph 4 of this Section 209 or any other obligations of the Developer pursuant to this Agreement, Developer shall, at its sole cost and expense, promptly take (i ) all actions required by any federal, state or local governmental agency or political subdivision or any Governmental Requirements with respect to the entire Site, and (ii ) all actions necessary to make full economic use of the Site for the purposes described in this Agreement, which actions, requirements or necessity arise from the presence upon, about or beneath the Site of any Hazardous Materials or Hazardous Materials Contamination regardless of when such Hazardous Materials or Hazardous Materials Contamination were introduced to the Site and regardless of who is responsible for introducing such Hazardous Materials or Hazardous Materials Contamination to the Site (the "Site Remediation" ) . The Site Remediation shall include, but not be limited to, investigation of the environmental condition of the Site, the preparation of any feasibility studies or reports and the performance of any cleanup, remedial, removal or restoration work required. The Developer shall take all actions necessary to promptly restore the Site to an environmentally sound condition for uses contemplated by this Agreement, notwithstanding any lesser standard of remediation allowable under applicable Governmental Requirements. Notwithstanding the above, in the event that the Agency has not already paid the Maximum Cleanup Costs prior to transfer of title pursuant to subparagraph 2 above, and in the event that additional contamination is discovered after the transfer that is attributable to the Agency Parcels or the Sarrabere-Wood-Goodman Parcels, then the Agency shall contribute any remaining funds up to the Maximum Cleanup Costs pursuant to the same terms and conditions set out in subparagraph 2 above. S . Indemnification. Except as provided for termination in paragraph 3 above, after transfer of title pursuant to Section 204, Developer shall save, protect, defend, indemnify and hold harmless Agency from and against any and all liabilities, suits, actions, claims, demands, penalties, damages (including, without limitation, penalties, fines and monetary sanctions) , losses, costs or expenses (including, without limitation, consultants' fees, investigation and laboratory fees, reasonable attorneys' fees and remedial and response costs) (the foregoing are hereinafter collectively referred to as 11/11/92 6449u/2460/009 -24- "Liabilities" ) which may now or in the future be incurred or suffered by Agency by reason of, resulting from, in connection with or arising in any manner whatsoever as a direct or indirect result of (i ) the ownership of all or any part of the Site, (ii) any act or omission on the part of Developer, or their agents, employees, contractors or invitees, (iii) the presence on or under, or the escape, seepage, leakage, spillage, discharge, emission or release from the Site of any Hazardous Materials or Hazardous Materials Contamination, (iv) the environmental condition of the Site, and (v) any Liabilities incurred under any Governmental Requirements relating to Hazardous Materials. 6. Duty to Prevent Hazardous Material Contamination. The Developer shall take all necessary precautions to prevent the release of any Hazardous Materials into the environment. Such precautions shall include compliance with all Governmental Requirements with respect to - Hazardous Materials. In addition, the Developer shall install and utilize such equipment and implement and adhere to such procedures as are consistent with the highest standards as respects the disclosure, storage, use, removal and disposal of Hazardous Materials. 7. Environmental Inquiries. The Developer shall notify the Agency, and provide to the Agency a copy or copies, of the following environmental permits, disclosures, applications, entitlements or inquiries relating to the Site: Notices of violation, notices to comply, citations, inquiries, cleanup or abatement orders, cease and desist orders, reports filed pursuant to self-reporting requirements and reports filed or applications made pursuant to any Governmental Requirement relating to Hazardous Materials and underground tanks, and the Developer shall report to the Agency, as soon as possible after each incident, any unusual, potentially important incidents, including but not limited to, the following: (a) All required reports of releases of Hazardous Materials, including notices of any release of Hazardous Materials as required by any Governmental Requirement; (b) All fires; (c) All instances where asbestos has been or may be disturbed by repair work, tenant improvements or other activities in buildings containing asbestos; (d) All notices of suspension of any permits; 11/11/92 6449u/2460/009 -25- 77 (e) All notices of violation from Federal, State or local environmental authorities; (f) All orders under the State Hazardous Waste Control Act and the State Hazardous Substance Account Act and corresponding federal statutes, concerning investigation, compliance schedules, clean up, or other remedial actions; (g) All orders under the Porter-Cologne Act, including corrective action orders, cease and desist orders, and clean-up and abatement orders; (h) Any notices of violation from OSHA or Cal-OSHA concerning employees' exposure to Hazardous Materials; (i ) All complaints and other pleadings filed against the Developer and/or the Agency relating to the Developer' s storage, use, transportation, handling or disposal of Hazardous Materials on the Site. In the event of a release of any Hazardous Materials into the environment, the Developer shall, as soon as possible after the release, furnish to the Agency a copy of any and all reports relating thereto and copies of all correspondence with governmental agencies relating to the release. Upon request of the Agency, the Developer shall furnish to the Agency a copy or, copies of any and all other environmental entitlements or inquiries relating to or affecting the Site including, but not limited to, all permit applications, permits and reports including, without limitation, those reports and other matters which may be characterized as confidential . J. [ §210] Conditions Precedent to the Conveyance, Termination, Reimbursement 1 . Notwithstanding any other provision of this Agreement to the contrary, Agency' s obligation to convey the Agency Parcels to Developer and the close of escrow shall, in addition to any other conditions set forth herein in favor of Agency, be conditional and contingent upon the satisfaction or waiver by Agency in its sole and absolute discretion, of each and all of the following conditions (collectively, the "Agency' s Conditions Precedent to the Conveyance" ) : (i) Developer shall have obtained all of the development and building approvals required to initiate development of the Site in accordance with this Agreement; including, but not limited to, tentative tract maps, conditional use permits, and grading permits; (ii) Developer shall have provided the evidence of financing required in Section 202 of the Agreement acceptable to Agency; 11/11/92 6449u/2460/009 -26- (iii) Developer shall have deposited into escrow all of the documents, fees, charges, costs, and items required to be deposited therein by Developer pursuant to this Agreement; (iv) Developer shall have submitted to Agency' s Executive Director evidence of liability insurance required pursuant to Section 308 of this Agreement; and (v) The estimated Cleanup Costs for the Agency Parcels shall not exceed the Maximum Cleanup Cost established in Section 202 of this Agreement; (vi) Developer shall not be in material default of this Agreement; (vii) Developer shall submit to Agency a contract for construction of the Project and a guaranty acceptable to the project lender or completion bond acceptable to the Agency' s Executive Director; (viii) Agency shall have completed acquisition and/or possession of the Sarrabere-Wood-Goodman Parcels. (ix) Developer and the Agency are satisfied with the conditional use permit conditions as required by the City. (x) Developer shall have demolished the existing commercial structures pursuant to the approved demolition plan on Block 104. (xi ) City shall have obtained approval by the Coastal Commission of the revised Downtown Specific Plan which allows the parking for Block 104 to be met by existing offsite structures and the onsite ground level parking as shown on Plan CUP No. 92-17. In the event any of the Agency' s Conditions Precedent to the Conveyance are not satisfied or waived by Agency within the time periods provided herein and, with respect to any claimed default by Developer hereunder Developer has not cured said default within thirty (30) days after written notice from Agency, Agency may, at its option, terminate this Agreement .and any escrow opened hereunder. In the event of such a termination, neither party shall have any further rights or obligations to the other under this Agreement with respect to the Site; provided, however, that nothing in this Section 210 is intended to limit or restrict Agency' s rights under Article VI herein in the event of a termination due to an uncured default by Developer. In the event the Agency exercises its right to terminate based on failure to obtain Coastal Commission approval in subparagraph (xi) above, then Developer shall be entitled to reimbursement costs in the amount of One 11/11/92 6449u/2460/009 -27- Hundred and Fifty Thousand Dollars ($150, 000) in addition to retention of the Advance Assistance amount pursuant to Section 202(18) . Prior to any payment of the One Hundred and Fifty Thousand Dollars ($150, 000) , Developer shall provide Agency staff with documentation to their sole satisfaction verifying said predevelopment costs evidencing tht the costs were incurred during the period July 15, 1991 and November 16, 1992 . Only costs accepted by staff as verified which occured during that time period shall be paid even if the amount is less than One Hundred and Fifty Thousand Dollars ($150,000) . In the event Agency exercises its right to terminate based on inability to deliver possession of Sarabere-Wood-Goodman parcels, Developer shall retain the Advance Assistance but shall only be entitled to additional reimbursement under Section 611 herein for completion of Block 104. In the event of a termination by Agency due to failure to obtain: (i ) Coastal Commission approval or, (ii ) possession of Sarabere-Wood-Goodman, Developer shall be entitled to a six (6) month exclusive negotiating agreement with the Agency to renegotiate and redesign the project. 2 . Notwithstanding any other provisions of this Agreement to the contrary, Developer' s obligation to accept conveyance of the Agency Parcels from Agency, and the close of escrow shall, in addition to any other conditions set forth herein in favor of Developer, be conditional and contingent upon the timely satisfaction, or waiver by Developer in its sole and absolute discretion, of each and all of the following conditions (collectively, the "Developer' s Conditions Precedent to the Conveyance" ) : (i ) The Agency shall have acquired all of the individual parcels and property interests comprising the Sarrabere-Wood-Goodman Parcels (or the Agency shall have obtained an Order of Prejudgment Possession for any of such parcels or property interests for which fee title has not yet been obtained, with such Order meeting the requirements of Section 201 of this Agreement) ; (ii ) The City shall have approved the vacation of the Alley on the Site which is to be vacated consistent with the Scope of Development (Attachment No. 3) ; (iii) Agency shall have timely deposited the Agency Parcel( s) Grant Deed (Attachment No. 6) into Escrow in the manner and condition and by the date provided in this Agreement; (iv) The Title Company shall have committed to issuing to Developer a title insurance policy to Agency Parcels and Sarrabere-Wood-Goodman Parcels complying with the requirements set forth in Section 207 herein; 11/11/92 6449u/2460/009 -28- (v) Agency shall have deposited into escrow all of the documents, fees, charges, costs and items required to be deposited therein by Agency pursuant to this Agreement; (vi) Agency shall not be in material default of its obligations under this Agreement. (vii) Developer and Agency are satisfied with the conditional use permit conditions as required by the City and in the event of an appeal to the Coastal Commission, the Coastal Commission has approved the conditional use permit conditions. (viii) Developer shall have obtained debt and/or equity financing as it deems necessary in its sole and absolute discretion for the development of the contemplated Project including Block 104, Block 105 and all associated on and off site improvements. Such approvals shall include, without limitation, the specific approval and authorization from Birtcher Real Estate Limited. (ix) Developer shall have obtained all necessary discretionary permits approvals for the development of the Site including, without limitation, the development of Block 104, Block 105 and all associated on and off site improvements and such permits and approvals shall be unmodified and in full force and effect at Closing. Such permits and approvals shall include all governmental approvals necessary for the issuance of building permits for the Project as designed, including, without limitation, tentative subdivision map approvals and conditional use permits. In the event any of the Developer' s Conditions Precedent to the Conveyance are not satisfied or waived by Developer within the time periods provided herein and, with respect to any claimed default by Agency hereunder, Agency has not cured said default within thirty (30) days after written notice from Developer, Developer may, at its option, terminate this Agreement and any escrow opened hereunder. In the event of such termination by Developer, neither party shall have any further rights or liabilities to the other under this Agreement with respect to the Site. Notwithstanding the above, in the event of Developer termination due to failure of Agency to obtain possession of the Sarabere-Wood-Goodman Parcels, Developer shall be entitled to retention of the Advance Assistance amount, and, if applicable, to costs pursuant to Section 611. Developer shall also be entitled to a six (6) month exclusive negotiating agreement with the Agency to allow time to redesign and renegotiate the project. 11/11/92 6449u/2460/009 -29- K. [ §211] Land Use Entitlements The Developer as to the Developer Parcels and Agency as to the Agency Parcels shall be responsible and shall cooperate and assist in making appropriate application to the City of Huntington Beach to satisfy all provisions of the California Subdivision Map Act (Government Code Section 66410, et sec . ) and local enactments pursuant thereto as well as any other land use entitlements including, but not limited to, coastal development permit, conditional use permit and tentative and final tract map, that are applicable with respect to the development of the Site. The Agency shall cooperate with and support any Property Owner' s application for liquor license. III . [ §300] DEVELOPMENT OF THE SITE A. [ §301] Development of the Site by the Developer 1. [ §302 ] Scope of Development The Developer shall commence and complete construction of the improvements to be constructed by the Developer (the "Developer Improvements" ) according to the Scope of Development (Attachment No. 3) and consistent with approved entitlements and by the respective times established therefor in the Schedule of Performance (Attachment No. 4) . The working drawings for the Developer Improvements shall include any plans and specifications approved by the City and/or Agency, and shall incorporate or show compliance with all applicable conditions and environmental mitigation measures. 2. [ §303 ] Site Plan By the respective times set forth therefor in the Schedule of Performance (Attachment No. 4) , the Developer shall prepare and submit to the Agency for its approval Preliminary Design Drawings for the Project and site plan and related documents containing the overall plan for development of the Site in sufficient detail to enable the Agency to evaluate the proposal for conformity to the requirements of this Agreement. The Site shall be developed as established in this Agreement and such documents, except as changes may be mutually agreed upon between the Developer and the Agency. 3 . [ §304] Construction Drawings and Related Documents By the time set forth therefor in the Schedule of Performance (Attachment No. 4) , the Developer shall prepare and submit to the City and the Agency for written approval 11/11/92 6449u/2460/009 -30- construction drawings, parking plan, a landscape plan, and related documents for development of the Site. 4. [ §305] Cost of Construction The cost of developing the Site and constructing all improvements thereon shall be borne by the Developer with the exception of those costs to be borne by the Agency pursuant to this Agreement. S. [ §306] Construction Schedule The Developer shall promptly begin and thereafter diligently prosecute to completion the construction and the development of the Site within the times specified therefor in the Schedule of Performance (Attachment No. 4) . 6. [ §307] Anti-Discrimination During Construction The Developer, for himself and his successors and assigns, agrees that in the construction of the improvements provided for in this Agreement, the Developer will not discriminate against any employee or applicant for employment because of race, color, creed, religion, sex, marital status, handicap, national origin or ancestry. 7. [ §308] Bodily Injury and Property Damage Insurance The Developer shall defend, assume all responsibility for and hold the Agency, its officers and employees, harmless from, all claims or suits for, and damages to, property and injuries to persons, including accidental death (including attorneys fees and costs) , which may be caused by any of the Developer' s activities under this Agreement, whether such activities or performance thereof be by the Developer or anyone directly or indirectly employed or contracted with by the Developer and whether such damage shall accrue or be discovered before or after termination of this Agreement. Prior to the commencement of construction, the Developer shall take out and shall maintain in effect during the entire course of construction a comprehensive liability policy in the amount of Two Million Dollars ($2,000,000) combined single limit policy (part of which coverage may be provided by umbrella policies) , including contractual liability, as shall protect the Developer, City and Agency from claims for such damages. The Developer shall furnish a certificate of insurance in form reasonably acceptable to the Agency countersigned by an authorized agent of the insurance carrier on a form of the insurance carrier setting forth the general provisions of the insurance coverage. This countersigned certificate -shall name the City and the Agency and their 11/11/92 6449u/2460/009 -31- respective officers, agents, and employees as additional insureds under the policy. The certificate by the insurance carrier shall contain a statement of obligation on the part of the carrier to notify City and the Agency of any material change, cancellation or termination of the coverage at least thirty (30) days in advance of the effective date of any such material change, cancellation or termination. Coverage provided hereunder by the Developer shall be primary insurance and not contributing with any insurance maintained by the Agency or City, and the policy shall contain such an endorsement. The insurance policy or the certificate of insurance shall contain a waiver of subrogation for the benefit of the City and the Agency. The required certificate shall be furnished by the Developer prior to the Agency Conveyance. The Developer shall also furnish or cause to be furnished to the Agency evidence satisfactory to the Agency that any contractor with whom it has contracted for the performance of work on the Site or otherwise pursuant to this Agreement carries workers' compensation insurance as required by law. The obligations set forth in this Section 308 shall remain in effect only until a final Certificate of Completion has been furnished for all of the Developer Improvements as hereafter provided in Section 309 of this Agreement. B. 16309] Certificate of Completion Promptly after the completion of all of the Developer Improvements in substantial conformity with this Agreement (as determined by the Executive Director of the Agency) and upon the written request of the Developer, the Agency shall furnish the Developer with a Certificate of Completion (Attachment No. 8) , which evidences and determines the satisfactory completion of such construction and carries forward those provisions and covenants specified in this Agreement, the Redevelopment Plan and the California Community Redevelopment Law. The issuance and recordation of the Certificate of Completion (Attachment No. 8) with respect to the Developer Improvements shall not supersede, cancel, amend or limit the continued efficacy of any obligations relating to the maintenance of the Site, use restrictions, payment of monies, or any other obligations except for the obligation to complete construction of the Developer Improvements as of the time of the issuance of such certificate. If the Agency refuses or fails to furnish a Certificate of Completion (Attachment No. 8) with respect to the Site after written request from the Developer, the Agency shall, within forty-five (45) days of the written request, provide the Developer with a written statement of the reasons 11/11/92 6449u/2460/009 -32- . the Agency refused or failed to furnish such Certificate of Completion. Partial certificates of completion in substantially the form of "Attachment 8A" may be available at the sole and absolute discretion of the Executive Director. Upon issuance of a Certificate of Completion (Attachment No. 8) for the Developer Improvements, construction of such Developer Improvements shall be deemed to have been completed in conformity with this Agreement. The Certificate of Completion (Attachment No. 8) is not a notice of completion as referred to in Section 3093 of the California Civil Code. C. [ §310] No Encumbrances Except Mortgages and Deeds .of Trust Prior to the Agency' s issuance of the final Certificate of Completion for all of the Developer Improvements pursuant to Section 309 above, the Developer shall not encumber the Site or any portion thereof with any mortgage, deed of trust, or other conveyance for financing purposes without obtaining the Agency' s prior written approval. This Section 310 shall not apply and shall have no further force or effect after the issuance of the Final Certificate of Completion. The Agency shall not unreasonably withhold, delay, or condition approval of any conveyance for financing if the following conditions and requirements are met: 1 . The conveyance for financing is to a responsible institutional lender with the capability of funding the loan in accordance with its terms; and 2 . The proceeds of the loan are committed to the development of the Site (including without limitation all direct and indirect costs of the development, as well as site preparation, direct construction costs, title charges, leasing and sales commissions, interest expense and other financing costs, architectural, engineering, legal, and similar expenses, tenant improvements or tenant improvement allowances for tenants in the Commercial Portion of the Site, and the like) , and/or the refinancing of any such loan (provided that the unpaid principal balance of any existing loan is not increased by virtue of any such refinancing) . 3 . Agency agrees to subordinate to financing approved pursuant to this Section 310 to an amount equal to the actual Development Cost of the project as defined in the Equity Participation Share (Attachment No. 12 ) less the Developer' s equity of fifteen percent ( 15%) of the Development Cost. 4. Documentary substantiation of the estimates utilized to satisfy paragraphs 2 and 3 above are supplied to the Agency. 11/11/92 6449u/2460/009 -33- Subject to the provisions of Section 310 of this Agreement, the Developer shall be entitled to record the mortgage or deed of trust securing any such approved financing prior to recordation of the Deed of Trust (Attachment No. 7) which secures the Purchase Price for the Agency Parcels. In addition, the Agency agrees to execute any document or documents that may be reasonably requested by the Developer to subordinate the Agency' s Deed of Trust (Attachment No. 7) to any additional financing or refinancing meeting the same requirements set forth above for the original loan. D. [ §311 ] Holder Not Obligated to Construct Improvements The holder of any mortgage or deed of trust authorized by this Agreement shall not be obligated by the provisions of this Agreement to construct or complete the improvements or to guarantee such construction or completion; nor shall any covenant or any other provision in the Agency Deed covering the Agency Parcel or, if applicable, the Sarrabere-Wood-Goodman Parcel conveyed by the Agency to the Developer be construed so to obligate such holder. Nothing in this Agreement shall be deemed to construe, permit or authorize any such holder to devote the Site to any uses or to construct any improvements thereon, other than those uses or improvements provided for or authorized by this Agreement. E. [ §312 ] Notice of Default to Mortgagee or Deed of Trust Holders; Right to Cure With respect to any mortgage or deed of trust granted by Developer as provided herein, whenever the Agency shall deliver any notice or demand to Developer with respect to any breach or default by the Developer in completion of construction of the improvements, the Agency shall at the same time deliver to each holder of record of any mortgage or deed of trust authorized by this Agreement a copy of such notice or demand. Each such holder shall (insofar as the rights of the Agency are concerned) have the right, at its option, within sixty (60) days after the receipt of the notice, to cure or remedy or commence to cure or remedy any such default and to add the cost thereof to the mortgage debt and the lien of its mortgage. Commencement of foreclosure or power of sale proceedings under any mortgage or deed of trust coupled with written notice of such holder' s intention to cure Developer' s default shall be deemed to be commencement of cure. Nothing contained in this Agreement shall be deemed to permit or authorize such holder to undertake or continue the construction or completion of the improvements (beyond the extent necessary to conserve or protect the improvements or construction already made) without first having expressly assumed the Developer' s obligations to the Agency by written assumption agreement reasonably satisfactory to the Agency. The holder, in that 11/11/92 6449u/2460/009 -34- event, must agree to complete, in the manner provided in this Agreement, the improvements to which the lien or title of such holder relates, and submit evidence satisfactory to the Agency that it has the qualifications and financial responsibility necessary to perform such obligations. Any such holder properly completing such improvement shall be entitled, upon compliance with the requirements of Section 312 of this Agreement, to a Certificate of Completion (as therein defined) . F. [ §313) Failure of Holder to Complete Improvements In any case where, sixty (60) days after receipt by a holder of notice of default by the Developer in completion of construction of improvements under this Agreement, the holder of any mortgage or deed of trust creating a lien or encumbrance upon the Site or any part thereof has not exercised the option to construct, or if it has exercised the option and has not proceeded diligently with construction, or to obtain title after institution of foreclosure or trustee' s sale proceedings, the Agency may purchase the mortgage or deed of trust by payment to the holder of the amount of the unpaid mortgage or deed of trust debt, including principal and interest and all other sums secured by the mortgage or deed of trust. If the ownership of the Site or any part thereof has vested in the holder, the Agency, if it so desires, shall be entitled to a conveyance from the holder to the Agency upon payment to the holder of an amount equal to the sum of the following: a. The unpaid mortgage or deed of trust debt at the time title became vested in the holder (less all appropriate credits, including those resulting from collection and application of rentals and other income received during foreclosure proceedings) ; b. All expenses with respect to foreclosure; C. The net expense, if any (exclusive of general overhead) , incurred by the holder as a direct result of the subsequent management of the Site or part thereof; d. The costs of any improvements made by such holder; and e. An amount equivalent to the interest that would have accrued on the aggregate of such amounts had all such amounts become part of the mortgage or deed of trust debt and such debt had continued in existence to the date of payment by the Agency; less f. Any income derived by the lender from operations conducted on the Site (the receipt of principal and interest payments in the ordinary course of business shall not constitute income for the purposes of this subsection (f) ) . 11/11/92 6449u/2460/009 -35- G. [ §314] Right of the Agency to Cure Mortgage or Deed of Trust Default In the event of a mortgage or deed of trust default or breach by the Developer prior to the completion of the construction of the improvements on the Site or any part thereof and the holder of any mortgage or deed of trust has not exercised its option to construct, the Agency may cure the default. In such event, the Agency shall be entitled to reimbursement from the Developer of all proper costs and expenses incurred by the Agency in curing such default. The Agency shall also be entitled to a lien upon the Site to the extent of such costs and disbursements. Any such lien shall be subject to the construction financing mortgages or deeds of trust. H. [ §315] Right of the Agency to Satisfy Other Liens on the Site After Title Passes After the conveyance of title and prior to the completion of construction, and after the Developer has had written notice and has failed after a reasonable time, but in any event not less than thirty (30) days, to challenge, cure, adequately bond against, or satisfy any liens or encumbrances on the Site which are not otherwise permitted under this Agreement, the Agency shall have the right but no obligation to satisfy any such liens or encumbrances; provided, however, that nothing in this Agreement shall require the Developer to pay or make provision for the payment of any tax, lien, assessment, or charge so long as the Developer shall in good faith contest the validity or amount thereof and so long as such delay in payment shall not subject the Site or a portion thereof to forfeiture or sale. IV. [ §400] USE OF THE SITE A. [ §401 ] Uses The Developer covenants and agrees for itself, its successors, its assigns, and every successor in interest to the Site that the Developer, such successors and such assignees, shall not devote the Site to any uses other than the uses specified in or permitted by the Redevelopment Plan, the Covenants (Attachment No. 9) , and this Agreement (in conformity with the limitations of the Scope of Development (Attachment No. 3 ) , as the same may be amended from time to time in accordance with Developer' s rights under this Agreement and applicable law) for the periods of time specified therein. The foregoing covenant shall run with the land. The Project as described in the Scope of Development (Attachment No. 3 ) specifies commercial uses only on Block 104, however, nothing herein precludes the owners of Block 104 from applying to the City for the ability to convert to residential uses. Such a 11/11/92 6449u/2460/009 -36- conversion would be at the sole discretion of the City. It is the Agency' s intent that there will be no interruption of business activity on Block 104 due solely to implementation of this Agreement until a conditional use permit for the Site is approved. The Developer covenants by and for itself and any successors in interest that there shall be no discrimination against or segregation of any person or group of persons on account of race, color, creed, religion, sex, marital status, handicap, national origin or ancestry in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the Site, nor shall the Developer itself or any person claiming under. or through it establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees or vendees of the Site. The foregoing covenants shall run with the land. The Developer shall refrain from restricting the rental, sale or lease of the Property or any portion of the Site on the basis of race, color, creed, religion, sex, marital status, handicap, national origin or ancestry of any person. All such deeds, leases or contracts shall contain or be subject to substantially the following nondiscrimination or nonsegregation clauses: 1. In deeds: "The grantee herein covenants by and for himself or herself, his or her heirs, executors, administrators and assigns, and all persons claiming under or through them, that there shall be no discrimination against or segregation of, any person or group of persons on account of race, color, creed, religion, sex, marital status, national origin or ancestry in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the land herein conveyed, nor shall the grantee himself or herself or any person claiming under or through him or her, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees or vendees in the land herein conveyed. The foregoing covenants shall run with the land. " 2. In leases: "The lessee herein covenants by and for himself or herself, his or her heirs, executors, administrators and assigns, and all persons claiming under or through him or her, and this lease is made and accepted upon and subject to the following conditions: 11/11/92 6449u/2460/003 -37- "There shall be no discrimination against or segregation of any person or group of persons on account of race, color, creed, religion, sex, marital status; ancestry or national origin in the leasing, subleasing, transferring, use, occupancy, tenure or enjoyment of the premises herein leased nor shall the lessee himself or herself, or any person claiming under or through him or her, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, sublessees, subtenants or vendees in the premises herein leased. " 3. In contracts: "There shall be no discrimination against or segregation of, any person, or group of persons on account of race, color, creed, religion, sex, marital status, ancestry or national origin, in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the premises, nor shall .the transferee himself or herself or any person claiming under or through him or her, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees or vendees of the premises. " Except for covenants against discrimination or segregation, which shall continue in effect in perpetuity, the covenants set forth in this Section 401 shall terminate on January 1, 2017. B. [ §402] Maintenance of the Site Prior to issuance of a Certificate of Completion by the Agency, the Developer shall maintain the Developer Improvements on the Site and shall keep the Site free from any accumulation of debris or waste materials. C. [ 6403] Rights_ of Access The Agency, for itself and for the City and other public agencies, at their sole risk and expense, reserves the right to enter onto the Site or any part thereof which is owned or controlled by the Developer, at all reasonable times for the purpose of construction, reconstruction, maintenance, repair or service of any public improvements or public facilities located within dedicated public easements on or adjacent to the Site. Any such entry shall be made only after reasonable notice to Developer. Agency shall repair any damage to the Site and 11/11/92 6449u/2460/009 -38- restore the Site to its pre-existing condition. In addition, Agency shall indemnify, defend, and hold Developer harmless from any costs, claims, damages or liabilities pertaining to any entry. This Section 403 shall not be deemed to diminish any rights the Agency, the City, or any other public agencies may have without reference to this Section 403. D. [ §404] Effect of Violation of the Terms and Provisions of this Agreement_After Completion of Construction The Agency is deemed the beneficiary of the terms and provisions of this Agreement and of the covenants running with the land, for and in its own rights and for the purposes of protecting the interests of the community and other parties, public or private, in whose favor and for whose benefit this Agreement and the covenants running with the land have been provided. The Agreement and the covenants shall run in favor of the Agency, without regard to whether the Agency has been, remains or is an owner of any land or interest therein in the Site or in the Project Area. The Agency shall have the right, if the Agreement or covenants are breached, to exercise all rights and remedies, and to maintain any actions or suits at law or in equity or other proper proceedings to enforce the curing of such breaches to which it or any other beneficiaries of this Agreement and covenants may be entitled. V. [ §500] GENERAL PROVISIONS A. [ 6501) Notices Demands and Communications Between the Parties Written notices, demands and communications between the Agency and the Developer shall be sufficiently given if delivered by hand (and a receipt therefor is obtained or is refused to be given) or dispatched by registered or certified mail, postage prepaid, return receipt requested, to the principal offices of the Agency and the Developer which are set out in Sections 105 and 106 hereof. Such written notices, demands and communications may be sent in the same manner to such other addresses as either party may from time to time designate by mail as provided in this Section 501. A copy of written notices sent by either party shall be sent to the attention of: Barry Ross, Esq. 1 Newport Place Suite 900 Newport Beach, California 92660 Any written notice, demand or communication shall be deemed received immediately if delivered by hand or if delivered by registered or certified mail return receipt requested on the date received. 11/11/92 6449u/2460/009 -39- B. [ §502 ] Conflicts of Interest No member, official or employee of the Agency shall have any personal interest, direct or indirect, in this Agreement, nor shall any member, official or employee participate in any decision relating to the Agreement which affects his personal interests or the interests of any corporation, partnership or association in which he is directly or indirectly interested. The Developer warrants that it has not paid or given, and will not pay or give, any money or other consideration to any member, official, employee, or consultant of Agency for obtaining this Agreement. C. [ §503 ] Enforced Delay; Extension of Times of Performance In addition to specific provisions of this Agreement, performance by either party hereunder shall not be deemed to be in default, and all performance and other dates specified in this Agreement shall be extended, where delays or defaults are due to: war; insurrection; strikes; lockouts; riots; floods; earthquakes; fires; casualties; acts of God; acts of the public enemy; epidemics; quarantine restrictions; freight embargoes; lack of transportation; governmental restrictions or priority; litigation delays not the fault and beyond the reasonable control of the party claiming an extension of time to perform; unusually severe weather; acts or omissions of the other party; acts or failures to act of the City of Huntington Beach or any other public or governmental agency or entity (other than the acts or failures to act of the Agency which shall not excuse performance by the Agency) ; or any other causes beyond the control or without the fault of the party claiming an extension of time to perform. Notwithstanding anything to the contrary in this Agreement, an extension of time for any such cause shall be for the period of the enforced delay and shall commence to run from the time of the commencement of the cause, if notice by the party claiming such extension is sent to the other party within thirty (30) days of the commencement of the cause. Times of performance under this Agreement may also be extended in writing by the mutual agreement of the Developer and the Executive Director of the Agency. D. [ §504] Nonliability of Officials and Employees of the Agency No member, official or employee of the Agency shall be personally liable to the Developer, or any successor in interest, in the event of any default or breach by the Agency or for any amount which may become due to the Developer or its successors, or on any obligations under the terms of this Agreement. 11/11/92 6449u/2460/009 -40- VI . [ §600] DEFAULTS AND REMEDIES A. [ §601] Defaults -- General Subject to the extensions of time set forth in Section 503, failure or delay by either party to perform any term or provision of this Agreement constitutes a default under this Agreement. The party who so fails or delays must immediately commence to cure, correct, or remedy such. failure or delay, and shall complete such cure, correction or remedy with diligence. The injured party shall give written notice of default to the party in default, specifying the default complained of by the injured party. Except as required to protect against further damages, the injured party may not institute proceedings against the party in default until thirty (30) days after giving such notice or, provided that the party is proceeding with diligence to cure, such greater time as may be necessary to cure given the nature of the default. Failure or delay in giving such notice shall not constitute a waiver of any default, nor shall it change the time of default. B. [ §602] Legal Actions 1. [ §603] Arbitration Subject to the restrictions in Section 601, the parties shall promptly submit any dispute, claim or controversy arising out of or relating to this Agreement (or any agreement contemplated by this Agreement) (including any action in tort, contract, or otherwise, at equity or at law) , or any alleged breach (including, without limitation, any matter with respect to the meaning, effort, validity, termination, interpretation, specific performance or enforcement of this Agreement or any agreement contemplated by this Agreement) to binding arbitration before one arbitrator ("Arbitrator" ) . The arbitration shall be held in Orange County, California, at the offices of Judicial Arbitration & Mediation Services, Inc. ( "JAMS") , which offices are currently located at 500 North State College Boulevard, Suite 600, Orange, California 92668, in accordance with and under the then-current provisions of the Commercial Arbitration Rules of the American Arbitration Association and the following provisions: (a) Exclusive Remedy. The parties agree that binding arbitration shall be the sole means of resolving any disputes, claims, or controversies arising out of or relating to this Agreement (including any claim in tort or contract or otherwise, at equity or at law) , or any alleged breach (including, without limitation, with respect to the meaning, effect, validity, termination, interpretation, specific 11/11/92 6449u/2460/009 -41- performance or enforcement of this Agreement or any agreement contemplated by this Agreement) . (b) Notice. Either party has the right to initiate arbitration. Arbitration shall be initiated upon one party' s notice to the other setting forth a demand for arbitration and detailing with specificity the nature of the dispute, claim or controversy to be arbitrated. (c) Selection of Arbitrator. The parties may agree on a retired judge from the JAMS panel. If the parties are unable to so agree within thirty (30) days after the notice given under paragraph (b) above, then JAMS will provide a list of three available judges and each party may strike one. The remaining judge will serve as the Arbitrator. The Arbitrator is empowered with the full authority of a judge sitting on the bench of the Superior Court in and for the State of California and may make any ruling consistent with that power. In order to implement this provision, the parties, by executing this Agreement, agree to execute and file with the Superior Court, such papers as are appropriate to procure the appointment of the Arbitrator as a Judge Pro-Tempore of the Superior Court. (d) Applicable Law. The Arbitrator shall follow any applicable federal and California state law (with respect to all matters of substantive law) in rendering an award. (e) Discovery. In any dispute arbitrated under this Agreement, the parties shall have the right to use any procedures for discovery provided for under the laws of the State of California (currently contained in the California Code of Civil Procedure) ; however, the Arbitrator shall have the right to disapprove or to limit any discovery that the Arbitrator determines to be for purposes of delay or otherwise unnecessarily burdensome or oppressive. (f) Evidence and Decision. The Arbitrator shall diligently pursue the matters being submitted for arbitration and shall render his decision within sixty (60) days after the selection of the Arbitrator is completed. The parties agree to make available to the Arbitrator all books, records, and other information in their possession or control relating to the matters being arbitrated and requested by the Arbitrator at such time as the Arbitrator may deem necessary to make his decisions required by this Agreement. Each party shall have access during normal business hours to such books, records, and other data as it may reasonably require to analyze the matters being submitted to arbitration under this Agreement and to prepare and to prove its contentions. The Arbitrator shall consider only evidence admissible under the California Evidence Code. 11/11/92 6449u/2460/009 -42- (g) Experts. The Arbitrator, at his discretion and at the expense of the party who will bear the cost of the arbitration, may employ an expert or experts (including, as examples, accountants and appraisers) to assist him in his determinations. (h) Advocacy. Prior to rendering his determination or award, the Arbitrator shall afford each party an opportunity to express its views as to the proper determination of the matters under arbitration, orally or in writing as the Arbitrator may deem appropriate; provided, however, that (a) any party submitting written material shall be required to submit a copy of that material to the other party, who shall have the opportunity to submit a written reply to that material within ten (10) days, and (b) if either party is to submit oral statement, the other parties shall be afforded a reasonable opportunity to be present at the time at which these oral statements are made before the Arbitrator and to reply orally. (i) Arbitrability of Dispute. The arbitrability of any dispute, claim or controversy shall be determined by the Arbitrator. (j ) Judgment and Appeal . Judgment upon any award rendered by the Arbitrator may be entered in and enforced by any court having competent jurisdiction. The parties agree that all appellate rights to the decisions of the Arbitrator are preserved as if the decisions were rendered by a judge sitting on the bench of the Superior Court. (k) Damages. The Arbitrator shall have the power to make an award of actual compensatory damages as well as punitive damages. ( 1) Costs. The cost of the arbitration proceeding and any proceeding in court to confirm or to vacate any arbitration award, as applicable (including, without limitation, attorneys' fees and costs) , shall be borne by the unsuccessful party (or, at the discretion of the Arbitrator, may be prorated between the parties in such proportion as the Arbitrator determines to be equitable) and shall be awarded as part of the Arbitrator' s judgment. (m) Jurisdiction. The parties expressly consent to the jurisdiction of the courts (federal and state) in Orange County, California, to enforce any judgment of an Arbitrator and to render any provisional or injunctive relief in connection with or in aid of the arbitration. (n) Survival. This arbitration Section 603 shall survive termination of this Agreement. 11/11/92 6449u/2460/009 -43- . (o) Indemnification. The parties agree to indemnify the Arbitrator and any experts employed by the Arbitrator and to hold them unless from and against any claim or demand arising out of any arbitration under this Agreement unless resulting from the willful misconduct of the person indemnified. 2 . [ §604] Applicable Law The laws of the State of California shall govern the interpretation and enforcement of this Agreement. 3 . [ §605 ] Acceptance of Service of Process In the event that any legal action is commenced by the Developer against the Agency, service of process on the Agency shall .be made by personal service upon the Executive Director or in such other manner as may be provided by law. In the event that any legal action is commenced by the Agency against the Developer, service of process on the Developer shall be made by personal service and shall be valid whether made within or without the State of California or in such other manner as may be provided by law. C. [ §606] Rights and Remedies Are Cumulative Except as otherwise expressly stated in this Agreement, the rights and remedies of the parties are cumulative, and the exercise by either party of one or more of such rights or remedies shall not preclude the exercise by it, at the same or different times, of any other rights or remedies for the same default or any other default by the other party. D. [ §607] Inaction Not a Waiver of Default Any failures or delays by either party in asserting any of its rights and remedies as to any default shall not operate as a waiver of any default or of any such rights or remedies, or deprive either such party of its right to institute and maintain any actions or proceedings which it may deem necessary to protect, assert or enforce any such rights or remedies. E. [ §608] Remedies; Termination With Block 104 Completed 1 . [ §609 ] Damages. If either party defaults with regard to any of the provisions of this Agreement, the non-defaulting party shall serve written notice of such default upon the defaulting party. If a solely monetary default is not cured by the defaulting party within thirty (30) days after service of the 11/11/92 6449u/2460/009 -44- notice of default (or within such other period as is set forth herein) , the defaulting party shall be liable to the other party for any damages caused by such default. For a default which includes a nonmonetary obligation, if the default is not cured by the defaulting party within thirty (30) days after service of the notice of default or, if the default is of such a nature that it cannot reasonably be curred within said time, and the defaulting party does not commence to cure within said thirty (30) day period and diligently pursue such cure to completion, the defaulting party shall be liable to the other party for any damages caused by such default. Notwithstanding the above, this Section shall not be applicable if a termination by either party is invoked under Sections 209(3) or 210 of this Agreement. 2. [ §610] Specific Performance If either party defaults under any of the provisions of this Agreement, the non-defaulting party shall serve written notice of such default upon the defaulting party. If the default is not cured by the defaulting party within thirty (30) days of service of the notice of default or, if the default is of such a nature that it cannot reasonably be curred within said time, and the defaulting party does not commence to cure within said thirty (30) day period and diligently pursue such cure to completion, the non-defaulting party at its option may thereafter (but not before) commence an action for specific performance of the terms of this Agreement. Notwithstanding the above, this Section shall not be applicable if a termination by either party is invoked under Section(s) 611, 209(3. ) or 210 of this Agreement. S. [ 6611] Termination Resulting in Completion of Block 104 In the event that the Agreement is terminated in such a manner that the residential improvements are never completed on Block 105 but the commercial improvements are completed, with an issuance of partial certificates of completion, on Block 104, Agency shall reimburse Developer for those verified, documented and budgeted costs expended after Coastal Commission approval for the downtown specific plan and relating solely to the Block 104 improvements to the extent such costs are not the obligation of the Property Owners. Such Block 104 budget costs are limited to: sewer lateral, demolition, . hazardous materials remediation and relocation [separate from Agency payments, not to exceed Two Hundred Thousand Dollars ($200,000) ] prorated architectural, legal and engineering costs, one-half of bond costs, city fees, soils testing. Estimates for the budgeted costs are set out on Attachment No. 13, attached hereto and incorporated herein by this reference. In addition, reimbursement of One Hundred and Eighty Thousand Dollars ($180,000) shall be given to Developer 11/11/92 6449u/2460/009 -45- toward predevelopment costs upon issuance of Certificate of Completion for Block 104. Prior to any payment of the One Hundred Eighty Thousand Dollars ($180, 000) , Developer shall provide Agency staff with documentation to their sole satisfaction veryfying said predevelopment costs evidencing that the costs were incurred during the period July 15, 1991 and November 16, 1992. Only costs accepted by staff as verified which occured during that time period shall be paid even if the amount is less than One Hundred and Eighty Thousand Dollars ($180,000) . Agency would, in any event, complete the offsite public improvements and the Agency relocation obligations of Section 202(10. ) . VII . [ §700] SPECIAL PROVISIONS A. [ §701] Real Estate Commissions The Agency and the Developer each represent to the other party that it has not engaged the services of any finder or broker and that it is not liable for any real estate commissions, broker' s fees, or finder' s fees which may accrue by means of the acquisition of the Agency Parcels or the Sarrabere-Wood-Goodman Parcels, and agrees to hold harmless the other party from such commissions or fees as are alleged to be due from the party making such representations. B. [ §702 ] Successors In Interest The terms, covenants, conditions and restrictions of this Agreement shall extend to and shall be binding upon and inure to the benefit of the heirs, executors, administrators, successors and assigns of the Parties. Upon the termination of the restrictions imposed by Section 109 of this Agreement, which terminate upon the issuance by the Agency of a Certificate of Completion for the Project, all of the terms, covenants, conditions and restrictions of this Agreement which do not terminate upon the issuance by the Agency of the Certificate of Completion for the entire Site shall be deemed to be and shall constitute terms, covenants, conditions and restrictions running with the land. C. [ §703 ] Amendments to this Agreement The Developer and the Agency agree to mutually consider reasonable requests for amendments to this Agreement provided said requests are consistent with this Agreement and would not substantially alter the basic business terms included herein. 11/11/92 6449u/2460/009 -46- D. [ §704] Attorney Fees If either party to this Agreement is required to initiate or defend litigation in any way connected with this Agreement, the prevailing party in such litigation, in addition to any other relief which may be granted, whether legal or equitable, shall be entitled to reasonable attorney' s fees. Except as may be expressly provided elsewhere in this Agreement, if either party to this Agreement is required to initiate or defend litigation with a third party because of the violation or alleged violation of any term or provision of this Agreement, or obligation of the other part to this Agreement, then the party so litigating shall be entitled to reasonable attorney' s fees from the other party to this Agreement. Attorney' s fees shall include attorney' s fees on any appeal, and in addition a party entitled to attorney' s fees shall be entitled to all other reasonable costs for investigating such action, taking depositions and discovery, and all other necessary costs incurred in such litigation. All such fees shall be deemed to have accrued on commencement of such action and shall be enforceable whether or not such action is prosecuted to judgment. E. [ §705] Release of Claims Each party (the Developer and the Agency) , on behalf of itself and its officers, partners, successors, assignees and representatives, fully releases and discharges the other party and its officers, employees, agents, successors and representatives from all and any manner of rights, demands, liabilities, obligations, claims, or cause of actions, in law or equity, of whatever kind or nature, whether known or unknown, whether now existing or hereinafter arising, which arise from or relate in any manner to the Site and the ownership, acquisition and development thereof, except for the obligations contained in this Agreement. Developer and the Agency have been advised by their respective attorneys and have read and understood the provisions of Section 1542 of the California Civil Code, which provides: "A general release does not extend to claims which the creditor does not know or suspect to exist in his favor at the time of executing the release, which if known by him must have materially affected his settlement with the debtor. " Nevertheless, Developer and Agency do hereby assume all risks for claims, known or unknown, heretofore or hereafter arising from or relating to the Site and the acquisition and development thereof, except for the obligations contained in this Agreement and to the matters released in this Section 705, and do hereby waive all of their respective rights under 11/11/92 6449u/2460/009 -47- Section 1542 ' of the California Civil Code. This release shall survive the Conveyance and/or the termination of this Agreement. VIII . [ §800] ENTIRE AGREEMENT, WAIVERS This Agreement may be signed in counter-parts, each of which is deemed to be an original. This Agreement includes pages 1 through 49 and Attachment Nos. 1 through 14, which constitutes the entire understanding and agreement of the parties. This Agreement integrates all of the terms and conditions mentioned herein or incidental hereto, and supersedes all negotiations or previous agreements between the parties or their predecessors in interest with respect to all or any part of the subject matter hereof. All waivers of the provisions of this Agreement must be in writing signed by the appropriate authorities of the Agency and the Developer, and all amendments hereto must be in writing signed by the appropriate authorities of the Agency and the Developer. In any circumstance where under this Agreement either party is required to approve or disapprove any matter, approval shall not be unreasonably withheld, conditioned, or delayed. IN WITNESS WHEREOF, the Agency and the Developer have signed this Agreement on the respective dates set forth below. 19 REDEVELOPMENT AGENCY OF THE CITY OF HUNTINGTON BEACH By: Chairman ATTEST: Secretary APPROVED AS TO FORM: Stradling, Yocca, Carlson & Rauth, Special Counsel to the Agency 11/11/92 6449u/2460/009 -48- Agency Counsel COULTRUP COMPANIES, a California corporation By: Jon T. Coultrup, President BIRTCHER REAL ESTATE LIMITED, a California limited partnership By: BREICORP, a California corporation, Managing General Partner By: Michael H. Voss, President 11/11/92 6449u/2460/009 -49- STATE OF CALIFORNIA ) ss. COUNTY OF ) On this day of 19_, before me, the undersigned, a Notary Public in and for said State, personally appeared , personally known to me (or proved to me on the basis of satisfactory evidence) to be the person who executed this instrument as the Chairman of the REDEVELOPMENT AGENCY OF THE CITY OF HUNTINGTON BEACH and acknowledged to me that said Agency executed it. WITNESS my hand and official seal. (SEAL) 11/11/92 6449u/2460/009 STATE OF CALIFORNIA ) ss. COUNTY OF ) On this day of 19_, before me, the undersigned, a Notary Public in and for said State, personally appeared personally known to me or proved to me on the basis of satisfactory evidence to be the person who executed the within instrument as one of the general partners of COULTRUP COMPANIES, a California corporation that executed the within instrument, and that said partnership executed the same. WITNESS my hand and official seal. (SEAL) STATE OF CALIFORNIA ) ss. COUNTY OF ) On this day of 19_, before me, the undersigned, a Notary Public in and for said State, personally appeared personally known to me or proved to me on the basis of satisfactory evidence to be the person who executed the within instrument as one of the managing partners BIRTCHER REAL ESTATE LIMITED, a California limited partnership, the partnership that executed the within instrument, and that said partnership executed the same. WITNESS my hand and official seal. (SEAL) 11/11/92 6449u/2460/009 Main-Pier Phase I!. Existing Property Owners WalnutAvenve Lane wW.'r�+r' =i3: � W$ 3 II •Z Z x H . Sixth Fifth Main .� H Sireet Street Street E--� Wiwd Sonobena :., 'ii Pacific Coast Highwoy Rye wkq merd . ® Coulkup Abdelmuli Prop"Owners Dvm6pment Comparky Nor 1T, 1992 Main-Pier Phase I1 • Pr000sed Property Owners • • WadnvtAmnue • lane ri Wonhy hl rl O rr" H Sixth I fifth Main H H Sk"t SAraet • . . � 60 ;;•� •:,sip:-'� r Pacific Coast HlOhway . Coin dun rar sit h*pwy ows DWA"WICOR,��rhm1 r,H92 ATTACHMENT NO. 2 LEGAL DESCRIPTION BLOCK 104: AGENCY PARKING PARCEL Lots 12, 14, 16, 18, 20, 22, 24, 26 & 28 in Block 104 of Huntington Beach, as shown on a map recorded in Book 3, Page 36 of Miscellaneous Maps, Records of Orange County, California. AGENCY EXCHANGE PARCEL Lots 9 & 10 in Block 104 of Huntington Beach, as shown on a map recorded in Book 3, Page 36 of Miscellaneous Maps, Records of Orange County, California. PROPERTY OWNERS PARCELS Mase - Lot 23 in Block 104 of Huntington Beach, as shown on a map recorded in Book 3, Page 36 of Miscellaneous Maps, Records of Orange County, California. Draper - Lot 21 in Block 104 of Huntington Beach, as shown on a map recorded in Book 3, Page 36 of Miscellaneous Maps, Records of Orange County, California. Mulligan - Lot 17 in Block 104 of Huntington Beach, as shown on a map recorded in Book 3, Page 36 of Miscellaneous Maps, Records of Orange County, California. Alfonso - Lot 19 in Block 104 of Huntington Beach, as shown on a map recorded in Book 3, Page 36 of Miscellaneous Maps, Records of Orange County, California. Bagstad - Lots 7 & 8 in Block 104 of Huntington Beach, as shown on a map recorded in Book 3, Page 36 of Miscellaneous Maps, Records of Orange County, California. BLOCK 105 : SARRABERE-WOOD-GOODMAN PARCELS Lots 1, 2, & 3 in Block 105 of Huntington Beach, as shown on a map recorded in Book 3, Page 36 of Miscellanous Maps, Records of Orange County, California. 11/11/92 ATTACHMENT NO. 2 6449u/2460/009 CRACCHIOLO PARCELS Lots 4 & 5 in Block 105 of Huntington Beach, as shown on a map recorded in Book 3, Page 36 of Miscellaneous Maps, Records of Orange County, California. AGENCY PARCELS Lots 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, 17, 18, 19, 20, 21, 23, 25, & 27 in Block 105 of Huntington Beach, as shown on a map recorded in Book 3, Page 36 of Miscellaneous Maps, Records of Orange County, California. 11/11/92 ATTACHMENT NO. 2 6449u/2460/009 ATTACHMENT NO. 3 SCOPE OF DEVELOPMENT The purpose of this Attachment is to identify the scope of work to be performed by Developer and Agency and what guidelines are appropriate to utilize in the design and development of the Project. The development shall be consistent with CUP 92-17, Variance No. 92-28, tentative tract map no. 14666 and Coastal Development Permit No. 92-14 all of which shall control in the event of inconsistency with the requirements herein. I. ARCHITECTURE & DESIGN A. To the extent possible, and respecting the separate ownership of the parcels on Block 104, each separate block (Blocks 204 and 205) within the Site shall be designed and developed as an integrated complex. 1. The Developer Improvements shall be of high architectural quality, well landscaped, and effectively and aesthetically designed. 2. The shape, scale of volume, exterior design, and exterior finish of each building, structure, and other improvement must be consonant with, visually related to each other and, to the extent reasonably practical, to adjacent improvements existing or planned within the Project Area. 3. The open spaces between buildings shall be designed, landscaped and developed to the same degree of excellence. B. The total development shall be in conformance with the Amended Redevelopment Plan for the Main-Pier Redevelopment Project Area and subject to Agency review. II. DEVELOPER'S RESPONSIBILITIES A. General. All cost, expenses and indebtedness related to the assemblage, disposition and development of the Site per the Agreement shall be borne exclusively by Developer except as otherwise stated in the Agreement. B. Consistency With Approvals. The Project shall be consistent with all City approvals, including the final tract maps, the final building plans, this Agreement and as the same may be amended from time to time. 11/11/92 ATTACHMENT NO. 3 6449u/2460/009 Page 1 of 6 C. The Project. The Project consists of the following: 1. Residential Portion: (Block 105) a. Approximately 80 residential condominium units in a 3 to 4 story building including two stories of parking. b. Parking, at a minimum sufficient to provide 2 stalls per residential unit and/or to provide the code minimum per dwelling unit on site. C. Amenities include a swimming pool, jacuzzi, clubhouse/recreation room, security gates and two or more elevators. d. An on-site sales office. e. Construction materials shall be equal quality or better than the Town Square Project located at Main, Orange and 6th Streets. 2 . Commercial Portion: (Block 104) a. Approximately 47, 500 square feet of commercial buildings comprised of retail spaces, office spaces or other commercial uses. b. Parking as required by the City for the Commercial Portion shall be provided by Agency with credit for grandfathered spaces accrued to existing parcels, including: ( 1) Existing parking lot(s) or lots and structures to be designed and constructed at Agency or City expense, and (2 ) Offsite and onstreet parking around the perimeter of Block 104. D. Contractor. Developer shall select, oversee and coordinate one or more general contractors and relevant subcontractors for all of the work proposed herein. E. Signs. Signs shall conform to all City codes. Additionally, Developer shall submit a planned sign program for any external signs on both the Residential and the Commercial Portions of the Project. 11/11/92 ATTACHMENT NO. 3 6449u/2460/009 Page 2 of 6 F. Screening. Outdoor storage and equipment, including rooftop installations, shall be installed per City codes and screened from street-level public view. G. Landscaping. Developer is to provide and Developer or its successor shall maintain all landscaping on the Site, including within public rights of way within the Site and setback areas, in accordance with approved landscape plans. H. Utilities. Utilities shall be installed in accordance with all City codes. Utilities are identified as including, but not necessarily limited to the following (hereafter "Utilities" ) . a. Gas service (Southern California Gas Company) b. Electric service (Southern California Edison) C. Cable television (Paragon Cable) d. Sanitary sewer e. Storm drain/water runoff/catch-basin systems f. Water service (City Water Department) (1) Domestic water (2) Gray water (3) Fire hydrants and other water connections for use by and for the First Department and/or any fire control systems including connection to on-site sprinkler systems. g. The Utilities shall be installed in accordance with the City' s Municipal Codes. Developer will install/extend all utilities from the net lot area property lines of the Developer Parcels, Agency Parcels and Sarrabere-Wood-Goodman Parcels (the "Property Line") inwards to and into the improvements on the Site. The location of the Utilities at/on the Property Line (the "Connection Points" ) shall be determined by mutual consent between Agency and Developer and their relevant engineering services and consultants and shall be in accordance with the best economical practices of the building industry. I . Vehicular Access. The number and location of vehicular driveways and curb-breaks shall be in accordance with the approved plans. 11/11/92 ATTACHMENT NO. 3 6449u/2460/009 Page 3 of 6 J. Offsite Improvements for Block 105. 1 . Developer shall, at his expense, engineer and install the sidewalks, curbs and gutters, subsurface paving and finish paving between the Property Line of Block 105 up to but not necessarily limited to the centerline of the streets surrounding Block 105 except that portion of the perimeter of Block 105 adjacent to the Worthy Property, which shall be paid for by Agency. 2 . As required by City plan approvals, Developer shall install, reroute . or cause to be rerouted, relocated, undergrounded and/or otherwise rebuild, all necessary Utility services, as described in II .H. above, and/or other designated improvements in the public right of way as are required for City approval of plans within the public right of ways between the Property Line and the centerline of the adjoining streets bounding Block 105, from their present locations and/or configurations, for the development, use and maintenance of the improvements on the Block 105 portion of the Site. 3 . Developer shall install or relocate any streetlights, street signs, traffic signs, parking meters, traffic signals, traffic controls or any such utility service work commonly associated with such installation if required by City. 4. Developer and its engineers and contractors shall coordinate with Caltrans relating to any improvements and/or offsite work on Pacific Coast Highway ( "PCH" ) . III . AGENCY RESPONSIBILITIES A. General . The Agency shall be responsible for payment of and expenses related to the development of Block 104 of the Site as enumerated in this Section III (c) . B. Indemnification and Hold Harmless. Agency shall indemnify and hold Developer harmless from all claims or suits for, and damages to, property and injuries to persons, including accidental death (including attorney' s fees and costs) , to the extent caused by the negligence of Agency' s or employees' or agents' activities under Section III of this Scope of Development unless the Developer acts as contractor 11/11/92 ATTACHMENT NO. 3 6449u/2460/009 Page 4 of 6 for Agency, in which event the Developer shall defend and hold harmless the Agency. C. Related Consultants. Agency shall be responsible for direct payment for all consultant architectural, civil engineering, and other services required for the plans and specifications and related job-site supervision for the work identified hereafter. This shall include all field engineering services, including surveying, required to implement said plans and specifications, including, but not limited to soils and geological tests and studies and monitoring, civil engineering services, consultations and visits. Such work shall also include surveying for utility services and locations, street lines and elevations, soil tests, materials testing and all specific services requested and/or necessitated by City inspector requests and public works inspectors and/or public works engineer requests and/or City public works directives and changes. Field services also include work performed due to any unplanned and/or emergency situations as they arise. 1 . No consulting engineering services or contractor or subcontractor in the employ of Developer shall be required to perform any offsite work and/or emergency repair or other work without a written work authorization from a City inspector or City engineer or duly authorized City official. 2 . In the event of an emergency which threatens the public Improvements on the Site and/or is clearly hazardous to public welfare in which a written work authorization is not immediately available, and Developer and/or his contractor( s) are present and capable of performing, Developer with notice to City Public Works Department shall at his discretion proceed to abate such emergency as is needed to preserve the Improvements and/or remove or abate such public hazard. The Agency and/or the City shall reimburse Developer any and all costs associated with such emergency and/or hazard abatement or removal, to the extent not otherwise a Developer cost under this Agreement. Developer shall be covered by the indemnification and hold harmless provisions set forth above for any such work. D. Offsites and Public Improvements. All offsite and on-site public improvements to and around Block 104 up to, but not necessarily limited to within the centerline of the streets adjacent and bounding Block 104, including the following: 11/11/92 ATTACHMENT NO. 3 6449u/2460/009 Page 5 of 6 1. Relocation of the Alley (as identified in the Proposed Site Map to this Agreement) and related easement work to maintain Utility services to the Connection Points on Block 104. 2. Construction of a parking lot in the area shown on the Site Map. 3. Construction of any Utility services and/or relocation and/or undergrounding thereof for other parcels within Block 104 which are not part of the scope of work identified herein (Lane and Abdelmuti properties) . 4. Street, sidewalk, curb and gutter surrounding Block 104. D. Utilities. For use by the improvements on Block 104, the Agency shall install, reroute or cause to be rerouted, relocated, undergrounded and/or otherwise rebuild, all necessary Utility Services, as described in II .H. , above, within the public right of ways as is needed, from their present locations and/or configurations, for the development, use and maintenance of the improvements on the Site. Said installations, rerouting, relocation, undergrounding and/or rebuilding shall be to the Property Line. E. Easements and Permits. Agency agrees to assist Developer as necessary and/or requested by Developer, with the filing and processing of required applications and permit processing to effectuate easements and permits necessary to the development of the Site and the Improvements thereon. 11/11/92 ATTACHMENT NO. 3 6449u/2460/009 Page 6 of 6 ATTACHMENT NO. 4 SCHEDULE OF PERFORMANCE I. GENERAL PROVISIONS 1. Execution of Agreement Not later than forty-five by the Agency. The Agency (45) days after the date shall approve and execute of execution and submission this Agreement, and shall of three (3) copies of deliver one (2) copy this Agreement by the thereof to the Developer. Developer and the Property Owners have executed their individual covenants, conditions and restrictions. 2. Evidence of Financin Not later than ten (10) and Insurance Certificates. months from Coastal Developer shall submit Commission approval of the evidence of financing and Downtown Specific Plan, but Insurance Certificates. in no event later than July 15, 1994. 3. Developer Becomes Managing Not later than ten (10) General Partner. _The months from Coastal Developer shall become a Commission approval of the partnership between Coultrup Downtwon Specific Plan, but Companies and a new Birtcher in no event later than July entity and that partnership 15, 1994. shall become the managing general partner of the Property Owners Partnership. II . ENTITLEMENT AND MAP APPLICATION, CONSTRUCTION DOCUMENTS AND BUILDING PERMITS WITH RESPECT TO THE SITE T 4. Developer and Agency Within ninety (90) days Application for Discretionary after Agency approval of Permits for Project. The this Agreement. Developer and Agency shall apply for the conditional use permit, tentative tract map, and coastal development permit required for the construction of the Developer Improvements. 5. Submittal of Construction Not later than eight (B) Drawings. The Developer months from Coastal shall submit to the City Commission approval of the complete construction draw- Downtown Specific Plan, but ings for all of the in no event later than Developer Improvements. July 15, 1994. 11/11/92 ATTACHMENT NO. 4 6449u/2460/009 Page 1 of 3 6. Review of Complete Within forty-five (45) days Drawings. The City and after submittal by its Building Official shall Developer. review the construction drawings submitted by the Developer. 7. Final Review of Complete Within twenty (20) days Drawings. The City and after resubmittal by the its Building Official shall Developer. review the construction drawings (revisions) sub- mitted by the Developer. 8. Obtaining of Building Permits. Not later than forty-five Developer shall obtain all (45) days after approval of building and other permits construction plans. needed to commence construction of the Developer Improvements. 9. Recording Property Owners Not later than ten (10) CC&Rs. Agency shall record days from issuance of Property Owner CC&Rs. building permits. III . ACQUISITION OF SARRABERE-WOOD-GOODMAN PARCELS. 10. Agency shall obtain Not later than eighteen (18) possession of Sarrabere-Wood- months from date of Goodman Parcels. execution of this Agreement. IV. ESCROW 11. Opening of Escrows. Agency Within twenty (20) days and Developer open escrows after approval of for the conveyance of the construction plans. Agency Parcels and the Sarrabere-Wood-Goodman Parcels. 12. Close of Escrow. Escrow Within ten (10) days closes. after the satisfaction (or waiver by the appropriate party) of all of the Conditions Precedent to Conveyance. V. CONSTRUCTION PHASE 13 . Commencement of Construction. Not later than thirty Developer shall commence (30) days after construction of the issuance of building Developer Improvements. permits. For Block 104 no 11/11/92 ATTACHMENT NO. 4 6449u/2460/009 Page 2 of 3 later than twelve (12) months from Coastal Commission approval of the Downtown Specific Plan, but in no event later than September 15, 1994. 14. Completion of Construction. Not later than eighteen Developer shall complete (18) months after construction of all of the the close of Escrow or the Developer Improvements. transfer of possession under an order of prejudgment possession but in no event later than forty-eight (48) months from the date of execution of this Agreement. 11/11/92 ATTACHMENT NO. 4 6449u/2460/009 Page 3 of 3 ATTACHMENT NO. 5 CRACCHIOLO GRANT DEED RECORDING REQUESTED BY ) AND WHEN RECORDED MAIL TO: ) Redevelopment Agency of the ) City of Huntington Beach ) 2000 Main Street ) Huntington Beach, CA 91016 ) 3 This Deed is recorded on the request and for the benefit of the Agency and is exempt for the payment of a recording fee pursuant to Government Code Section 6103. REDEVELOPMENT AGENCY OF THE CITY OF HUNTINGTON BEACH By: Its: Dated: 19 GRANT DEED FOR A VALUABLE CONSIDERATION, receipt of which is hereby acknowledged, GRANTOR: FRANK CRACCHIOLO AND DOLORES CRACCHIOLO, husband and wife, grant to THE REDEVELOPMENT AGENCY OF THE CITY OF HUNTINGTON BEACH, a public body, corporate and politic, the following described real property in the City of Huntington Beach, County of Orange, State of California: See Exhibit "A" attached hereto and made a part hereof. By: FRANK CRACCHIOLO By: DOLORES CRACCHIOLO 11/11/92 ATTACHMENT NO. 5 6449u/2460/09 Page 1 of 1 STATE OF CALIFORNIA ) ss. COUNTY OF ) On before me, the undersigned, a Notary Public in and for said State, personally appeared personally known to me or proved to me on the basis of satisfactory evidence to be the person whose name subscribed to the within instrument and acknowledged that executed the same. WITNESS my hand and official seal. (SEAL) STATE OF CALIFORNIA ) ) 55. COUNTY OF ) On before me, the undersigned, a Notary Public in and for said State, personally appeared , personally known to me or proved to me on the basis of satisfactory evidence to be the person whose name subscribed to the within instrument and acknowledged that executed the same. WITNESS my hand and official seal. (SEAL) 11/11/92 6449u/2460/09 ATTACHMENT NO. 5 EXHIBIT ►'A" TO ATTACHMENT NO. 5 LEGAL DESCRIPTION OF PARTICIPANT' S PARCEL That certain real property located in the City of Huntington Beach, County of Orange, State of California, described as follows: 11/11/92 EXHIBIT ►►A" TO 6449u/2460/09 ATTACHMENT NO. 5 ATTACHMENT NO. 6 RECORDING REQUESTED BY: ) AND WHEN RECORDED MAIL TO: ) The undersigned Grantor declares: Documentary transfer tax is REDEVELOPMENT AGENCY OF THE CITY OF HUNTINGTON BEACH By: Its: Dated: 19 BLOCK 105 AGENCY PARCELS GRANT DEED For valuable consideration, receipt of which is hereby acknowledged, the REDEVELOPMENT AGENCY OF THE CITY OF HUNTINGTON BEACH, a public body, corporate and politic, of the State of California, herein called "Grantor" acting to carry out the Redevelopment Plan, herein called "Redevelopment Plan" for the Main Pier Redevelopment Project, herein called "Project", under the Community Redevelopment Law of California, hereby grants to COULTRUP COMPANIES, a California corporation AND BIRTCHER REAL ESTATE LIMITED, herein called "Grantee," the real property hereinafter referred to as the "Property", described in Exhibit A attached hereto and incorporated herein, subject to the existing easements, restrictions and covenants or record described there. 1. Grantor excepts and reserves from the conveyance herein described all interest of the Grantor in oil, gas, hydrocarbon substances and minerals of every kind and character lying more than 500 feet below the surface, together with the right to drill into, through, and to use and occupy all parts of the Property lying more than 500 feet below the surface thereof for any and all purposes incidental to the exploration for and production of oil, gas, hydrocarbon substances or minerals from said site or other lands, but without, however, any right to use either the surface of the Property or any portion thereof within 500 feet of the surface for any purpose or purposes whatsoever. 2. The Property is conveyed in accordance with and subject to the Redevelopment Plan which was approved and adopted by Ordinance No. 2578, as amended by Ordinance Number 2634 of the City Council of the City of Huntington 11/11/92 ATTACHMENT NO. 6 6449u/2460/09 Page 1 of 4 Beach, and a Disposition and Development Agreement entered into between Grantor and Grantee dated , 1992 (the "DDA") , a copy of which is on file with the Grantor at its offices as a public record and which is incorporated herein by reference. 3. The Grantee shall devote, use, operate, and maintain the Property only to the development permitted by and the uses specified in the applicable provisions of the DDA, the Redevelopment Plan for the Project, or any amendments thereof, this Grant Deed, and the CCR's on the Property whichever document is more restrictive. 4. The Property is conveyed to Grantee at a purchase price, herein called "Purchase Price", determined in accordance with the uses permitted. Therefore, Grantee hereby covenants and agrees for itself, its successors, its assigns, and every successor in interest to the Property that the Grantee, such successors and such assigns, shall develop, maintain, use and operate the Property pursuant to the provisions of the DDA. In addition, Grantee shall maintain the improvements on the Property in conformity with this Grant Deed, the recorded CC&R's on the Property, and the Huntington Beach Municipal Code and shall keep the Property free from any accumulation of debris or waste materials. Grantee shall also maintain the required landscaping in a healthy condition. If, at any time, Grantee fails to maintain such landscaping, and said condition is not corrected after expiration of ten (10) days from the date of written notice from the Grantor, either the Grantor, or the City of Huntington Beach may perform the necessary maintenance and Grantee shall pay such costs as are reasonably incurred for such maintenance. Grantee shall only sell, transfer or convey the Property as a whole parcel and is not permitted to subdivide the Property, except as set out in the DDA, until the issuance of the Certificate of Completion without the prior written approval of the Grantor, or the City of Huntington Beach, if the Agency is no longer in existence at the date of request for approval. 5. For a period until the issuance of a Certificate of Completion as defined in the DDA, the Grantee shall not place or suffer to be placed on the Property any lien or encumbrance other than mortgages, deeds of trust, or any other form of conveyance required for financing of the the construction and operation of the Improvements on the Property and any refinancing of that permanent loan, and any other expenditures necessary and appropriate to develop and operate the Property pursuant to the DDA. The Grantee shall not enter into any such conveyance for financing without prior written approval of Grantor. No approval will be given for a conveyance of the property to finance the construction or improvements on real property other than the real property described in Exhibit A hereto. The sale, transfer, assignment of the Property, or any portion thereof or interest therein by the Grantee is subject to the provisions of Section 109 of the DDA. 6. The Grantee agrees for itself and any successor in interest not to discriminate upon the basis of race, color, creed or national origin in the sale, lease, or rental or in the use or occupancy of the Property hereby conveyed or any part thereof. Grantee covenants by and for itself, its 11/11/92 ATTACHMENT NO. 6 6449u/2460/09 Page 2 of 4 successors, and assigns, and all persons claiming under or through them that there shall be no discrimination against or segregation of, any person or group of persons on account of race, color, creed, national origin, religion, sex, marital status, or ancestry in the sale, lease, sublease, transfer, use, occupancy, tenure, or enjoyment of the Property, nor shall the Grantee itself or any person claiming under or through it, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees, or vendees in the Property. The foregoing covenants shall run with the land. 7. No violation or breach of the covenants, conditions, restrictions, provisions or limitations contained in this Grant Deed shall defeat or render invalid or in any way impair the lien or charge of any mortgage or deed of trust or security interest permitted by paragraph 5 of this Grant Deed; provided, however, that any subsequent owner of the Property shall be bound by such remaining covenants, conditions, restrictions, limitations and provisions, whether such owner's title was acquired by foreclosure, deed in lieu of foreclosure, trustee's sale or otherwise. 8. All covenants contained in this Grant Deed shall be covenants running with the land. Grantee's obligation to construct and develop the Developer Improvements on the Property shall terminate and shall become null and void upon recordation of a Certificate of Completion issued by Grantor for the Developer Improvements as defined in the DDA. The covenants contained in paragraphs 3, 4, 5, and 7 shall continue in effect for fifty (50) years from the date of recordation of this Grant Deed. Every covenant contained in this Grant Deed against discrimination contained in paragraph 6 of this Grant Deed shall remain in effect in perpetuity. 9. All covenants without regard to technical classification or designation shall be binding for the benefit of the Grantor, and such covenants shall run in favor of the Grantor for the entire period during which such covenants shall be in force and effect, without regard to whether the Grantor is or remains an owner of any land or interest therein to which such covenants relate. The Grantor, in the event of any breach of any such covenants, shall have the right to exercise all the rights and remedies and to maintain any actions at law or suits in equity or other proper proceedings to enforce the curing of such breach. 11/11/92 ATTACHMENT NO. 6 6449u/2460/09 Page 3 of 4 IN WITNESS WHEREOF, the Grantor and Grantee have caused this instrument to be executed on their behalf by their respective officers hereunto duly authorized, this day of , 19—. REDEVELOPMENT AGENCY OF THE 'CITY OF HUNTINGTON BEACH, a public body corporate and politic By: Chairman "GRANTOR" ATTEST: Secretary APPROVED AS TO FORM Stradling, Yocca, Carlson & Rauth Agency Special Counsel The undersigned Grantee accepts title subject to the conditions and covenants hereinabove set forth. COULTRUP COMPANIES, a California corporation By: Jon T. Coultrup, President BIRTCHER REAL ESTATE LIMITED, a California limited partnership By: BREICORP, a California corporation, Managing General Partner By: Michael H. Voss, President "GRANTEE" APPROVED AS TO FORM Counsel to Grantee 11/11/92 ATTACHMENT NO. 6 6449u/2460/09 Page 4 of 4 STATE OF CALIFORNIA } ) ss. COUNTY OF ORANGE ) On this day of 199 before me, the undersigned, a Notary Public in and for said State, personally appeared known to me (or proved to me on the basis of satisfactory evidence) to be the person who executed this instrument as the Chairman of the Redevelopment Agency of the City of Huntington Beach and acknowledged to me that the Redevelopment Agency of the City of Huntington Beach executed it. Signature of Notary Public STATE OF CALIFORNIA ) ss. COUNTY OF ORANGE ) On 19 , before me, the undersigned, a Notary Public in and for said State, personally appeared and , personally known to me or proved to me on the basis of satisfactory evidence to be the persons who executed the within instrument as limited partners of the limited partnership that executed the within instrument, and acknowledged to me that such limited partnership executed the same. WITNESS my hand and official seal. 11/11/92 6449u/2460/09 ATTACHMENT NO. 6 STATE OF CALIFORNIA ) ss. COUNTY OF ORANGE ) On 19 , before me, the undersigned, a Notary Public in and for said State, personally appeared and , personally known to me or proved to me on the basis of satisfactory evidence to be the persons who executed the within instrument as limited partners of the limited partnership that executed the within instrument, and acknowledged to me that such limited partnership executed the same. WITNESS my hand and official seal. 11/11/92 6449u/2460/09 ATTACHMENT NO. 6 EXHIBIT A LEGAL DESCRIPTION OF PROPERTY 11/11/92 EXHIBIT A to ATTACHMENT NO. 6 6449u/2460/09 Page 1 of 1 ATTACHMENT NO. 7 RECORDING REQUESTED BY ) AND WHEN RECORDED MAIL TO: ) Redevelopment Agency of the City ) of Huntington Beach ) 2000 Main Street ) Huntington Beach, CA 92648 ) This document is exempt from the payment of a recording fee pursuant to Government Code Section 6103. REDEVELOPMENT AGENCY OF THE CITY OF HUNTINGTON BEACH By: its, Datedt 19 DEED OF TRUST AND ASSIGNMENT OF RENTS THIS DEED OF TRUST AND ASSIGNMENT OF RENTS is made as of the day of , 19 , by and among COULTRUP COMPANIES and BIRTCHER REAL ESTATE LIMITED the "Trustor"), whose address is , California Title Insurance Company (the "Trustee"), whose address is , California , and the Redevelopment Agency of the City of Huntington Beach (the "Beneficiary"), whose address is 2000 Main Street, Huntington Beach, California 92648, FOR GOOD AND VALUABLE CONSIDERATION, including the indebtedness herein recited and the trust herein created, the receipt of which is hereby acknowledged, Trustor hereby irrevocably grants, transfers, conveys and assigns to Trustee, IN TRUST, WITH POWER OF SALE, for the benefit and security of Beneficiary, under and subject to the terms and conditions hereinafter set forth, ,the property located in the County of Orange, State of California, that is described in Exhibit A, attached hereto and by this reference incorporated herein' (the "Site"). TOGETHER WITH all rents, issues, profits, royalties, income and other benefits derived from the Site (collectively, the "rents"), provided that so long as Trustor is not in default hereunder, it shall be permitted to collect rents and operate the Project, as hereinafter defined, in accordance with the requirements of that certain Disposition and Development Agreement entered into between the Trustor, and the Beneficiary dated 1992 (the 11/11/92 ATTACHMENT NO. 7 6449u/2460/09 Page 1 of 14 "Agreement"), which Agreement is on file with the Beneficiary as a public record and is incorporated by reference herein; TOGETHER WITH all interests, estates or other claims, both in law and in equity which Trustor now has or may hereafter acquire in the Site and the rents; TOGETHER WITH all easements, rights-of-way and rights used in connection therewith or as a means of access thereto, including, without limiting the limitedity of the foregoing, all tenements, hereditaments* and appurtenances thereof and thereto; TOGETHER WITH any and all buildings and improvements now or hereafter erected thereon, and all property of the Trustor now or hereafter affixed to or placed upon the Site, including, without limitation, all fixtures, attachments, appliances, furnishings, equipment and machinery (whether fixed or movable) and other articles (including, in each instance, improvements, restorations, replacements, repairs, additions, accessions or substitutions thereto or therefor); TOGETHER WITH all leasehold estate, right, title and interest of Trustor in and to all leases or subleases covering the Site or any portion thereof now or hereafter existing or entered into, and all right, title and interest of Trustor thereunder, including, without limitation, all cash or security deposits, advance rentals, and deposits or payments of similar nature; TOGETHER WITH all right, title and interest of Trustor in and to all options to purchase or lease the Site or any portion thereof or interest therein, and any greater estate in the Site owned or hereafter acquired; TOGETHER WITH all right, title and interest of Trustor, now owned or hereafter acquired, in and to any land lying within the right-of-way of any street, open or proposed, adjoining the Site, and any and all sidewalks, alleys and strips and gores of land adjacent to or used in connection with the Site; TOGETHER WITH all the estate, interest, right, title, other claim or demand, of every nature, in and to such property, including the Site, both in law and in equity, including, but not limited to, all deposits made with or other security given by Trustor to utility companies, the proceeds from any or all of such property, including the Site, claims or demands with respect to the proceeds of insurance in effect with respect thereto, which Trustor now has or may hereafter acquire, any and all awards made for the taking by eminent domain or by any proceeding or purchase in lieu thereof of the whole or any part of such property, including without limitation, any awards resulting from a change of grade of streets and awards for severance damages; All of the foregoing, together with the Site, is herein referred to as the "Security". FOR THE PURPOSE OF SECURING: 11/11/92 ATTACHMENT No. 7 6449u/2460/09 Page 2 of 14 (a) Payment of the Agency's Equity Interest as defined in Section 202 and Attachment No. 12 of the DDA. (b) Payment of any sums advanced by Beneficiary to protect the Security pursuant to the terms and provisions of this Deed of Trust following a breach of Trustor's obligation to advance said sums and the expiration of any applicable cure period and upon five (5) business days notice to the Trustor, with interest thereon as provided herein; (c) Payment of such additional sums and interest thereon which may hereafter be loaned to Trustor, or its successors or assigns, by Beneficiary, when evidenced by a promissory note or notes or other documents reciting that they are secured by this Deed of Trust; and (d) Performance of every obligation, covenant or agreement of Trustor contained herein or the Agreement (and any amendments thereto). ARTICLE I DEFINITIONS 1. "Agreement" or "DDA" means that Disposition and Development Agreement entered into by and between the Trustor and the Beneficiary hereof, dated , 1992; said Agreement (a copy of which is on file with the Beneficiary at the address stated above, and including all of its attachments) is incorporated herein by reference. 2. "Covenants" means Attachment No. 9 to the Agreement. 3. "Developer Improvements" is defined in the Agreement. 4. The term "Expiration Date" means the date upon which all obligations the performance of which is secured by this Deed of Trust have been satisfied. 5. "Mortgage" means any permanent or long-term loan (other than a loan by an entity related to or controlled by the Developer), or any other financing device (including without limitation deeds of trust) the proceeds' of which are used in the construction of the Developer Improvements, which loan is secured by a security financing interest in the Trustor's interest in the Developer Improvements; 6. "Project" means the "Site" and the "Developer Improvements", together with all additions, improvements, restorations and replacements thereof, and together with the items set forth in the sixth paragraph hereof. 7. "Site" is defined in the second paragraph hereof. 8. "Security" is defined in the eleventh paragraph hereof. 9. "Standards" means those standards of construction and operation characteristic of multi-family residential complexes and retail buildings 11/11/92 ATTACHMENT No. 7 6449u/2460/09 Page 3 of 14 similar in scope to those anticipated by the DDA and which have been constructed with the five (5) years preceding the execution of the Agreement. 10. "Trustor" means Coultrup Companies and Birtcher Real Estate Limited, and its transferees and successors in interest. Where an obligation is created herein binding upon Trustor, the obligation shall apply to and bind any transferees or successors in interest. Where the terms of the Deed of Trust have the effect of creating an obligation of the Trustor and a transferee, such obligation shall be deemed to be a joint and several obligation of the Trustor and such transferee. Unless the context clearly otherwise requires, any capitalized term used herein and not defined herein shall have the meaning given to it under the Agreement (and any amendments thereto). ARTICLE II MAINTENANCE AND MODIFICATION OF THE PROJECT AND SECURITY; RELEASE UPON PAYMENT Section 2.1 Maintenance and Modification of the Project by Trustor. The Trustor agrees that at all times prior to the Expiration Date, the Trustor will, at the Trustor's own expense, maintain, preserve and keep the Project or cause the Project to be maintained, preserved and kept in a condition conforming to the Standards and with only those uses allowed by the Agreement. The Trustor will from time to time make or cause to be made all repairs, replacements and renewals deemed proper and necessary by it. The Beneficiary shall have no responsibility in any of these matters or for the making of improvements or additions to the Project. Trustor agrees to pay fully and discharge (or cause to be paid fully and discharged) all claims for labor done and for material and services furnished in connection with the Security, diligently to file or procure the filing of a valid notice of completion upon completion of construction of any part of the Security, diligently file or procure the filing of a notice of cessation upon the event of a cessation of labor on the work or construction on the Security for a continuous period of thirty (30) days or more, and to take all other reasonable steps to forestall the assertion of claims of lien against the Security or any part thereof. Section 2.2 Release of Land and Improvements. Upon its receipt of the Agency's Equity Interest as defined in Section 202 and Attachment No. 12 of the Agreement and all amounts secured by this Deed of Trust, and provided that the Trustor is not in default under the Agreement, the Beneficiary shall, upon the request of the Trustor, deliver to the Trustor such instruments as are reasonably necessary to confirm the release of the Security from the lien of this Deed of Trust. Partial releases shall be granted pursuant to Section 8.3 herein. Section 2.3 Granting of Easements. Trustor may grant easements, licenses, rights-of-way or other similar rights or privileges in the nature of easements with respect to any property or rights included in the Security 11/11/92 ATTACHMENT NO. 7 6449u/2460/09 Page 4 of 14 without the prior written approval of the Beneficiary. In the event such rights are granted, the Trustor shall promptly so advise the Beneficiary in writing. ARTICLE III TAXES AND INSURANCE; ADVANCES Section 3.1 Taxes, Other Governmental Charges and Utility Charges. Trustor shall pay, or cause to be paid, at least fifteen 15 days prior to delinquency, all taxes, assessments, charges and levies imposed by any public authority or utility company which are or may become a lien affecting the Security or any part thereof; provided, however, that Trustor shall not be required to pay and discharge any such tax, assessment, charge or levy so long as (a) the legality thereof shall be promptly and actively contested in good faith and by appropriate proceedings, and (b) Trustor maintains reserves adequate to pay any liabilities contested pursuant to this Section 3.1 in accordance with limitedly accepted accounting principles. with respect to special assessments or other similar governmental charges, Trustor shall pay such amount in full prior to the attachment of any lien therefor on any part of the Security unless the Trustor has secured the prior written approval of the Beneficiary to pay such amounts in installments over a period of years. In the event that Trustor shall fail to pay any of the foregoing items required by this Section to be paid by Trustor, Beneficiary may (but shall be under no obligation to) pay the same, after the Beneficiary has notified the Trustor of such failure to pay and the Trustor fails to fully pay any such item within seven (7) business days of the earlier of the receipt or mailing of such notice. Any amount so advanced therefor by Beneficiary, together with interest thereon from the date of such advance at the maximum rate permitted under Section 1(2) of Article XV of the California Constitution, shall become an additional obligation of Trustor to the Beneficiary and shall be secured hereby, and Trustor hereby agrees to pay all such amounts. Section 3.2 Provisions Respecting Insurance. (a) Trustor agrees to provide insurance covering one hundred percent (100%) of the replacement cost of all insurable items within the Project (except interior furniture and fixtures within the individual dwelling units) during the course of construction and following completion in the event of fire, lightning, debris removal, windstorm, flood, vandalism, malicious mischief, theft, mysterious disappearance and hazards, casualties and contingencies as are normally and usually covered by all-risk policies in effect in the locality where the Project is situated. (b) Trustor agrees to carry or cause to be carried: comprehensive limited liability insurance with respect to the Project with limits as set forth in the Agreement during the term of development and for one (1) year thereafter. Following said period and during the term of this Deed of Trust said limits for limited liability coverage shall be not less than $2,000,000 for each occurrence for personal injury (including without limitation bodily injury) and $500,000 with respect to property damage. Coverages thereunder 21/11/92 ATTACHMENT NO. 7 6449u/2460/09 Page 5 of 14 shall include limited liability, owners' and contractors' protection, workers' compensation insurance as required by law. (e) All such insurance policies and coverages (i) shall be maintained at Trustor's sole cost and expense so long as any part of the amounts secured by its Deed of Trust have not been paid, (fi) shall be with insurers of recognized responsibility, and in form and substance satisfactory to the Beneficiary, (iii) shall name Beneficiary as additional insured, and (iv) shall contain a provision to the effect that the insurer shall not cancel the policy or modify it materially and adversely to the interests of Beneficiary without first giving at least thirty (30) days' prior written notice thereof. Certificates of insurance for all of the above insurance policies, showing the same to be in full force and effect, shall be delivered to the Beneficiary upon demand therefor at any time prior to the Expiration Date. Section 3.3 Advances. In the event the Trustor shall fail to maintain the full insurance coverage required by this Deed of Trust or shall fail to keep the Project in good repair and operating condition, the Beneficiary may (but shall be under no obligation to) take out the required policies of insurance and pay the premium on the same or may make such repairs or replacements as are necessary and provide for payment thereof; and, provided that the Beneficiary provides five (5) business days' notice to the Trustor all amounts so advanced therefor by the Beneficiary shall become an additional obligation of the Trustor to the Beneficiary (together with interest as set forth below) and shall be secured hereby, which amounts the Trustor agrees to pay on demand of the Beneficiary, and if not- so paid, shall bear interest from the date of the advance at the maximum rate permitted by Section 1(2) of Article XV of the California Constitution. ARTICLE IV DAMAGE, DESTRUCTION OR CONDEMNATION Section 4.1 Damage and Destruction. If, prior to the Expiration Date, the Project or any portion thereof is destroyed (in whole or in part) or is damaged by fire or other casualty, the Trustor shall (a) cause any insurance proceeds arising from insurance referred to in Section 3.2 hereof and any other coverage acquired by the Trustor to be used to promptly rebuild and replace the Project, and (b) repair and replace the Project as necessary to bring the Project into conformity with the Standards; provided that such covenants shall be subordinated to the provisions of all senior obligations to which this Deed of Trust is subordinate. There shall be no abatement in, and Trustor shall be obligated to continue to pay, the amounts payable under this Deed of Trust. Section 4.2 Condemnation. If title to or any interest in or the temporary use of the Project or any part thereof shall be taken under the exercise of the power of eminent domain by any governmental body or by any person, firm or corporation acting under governmental authority, including any proceeding'or purchase in lieu thereof, the proceeds as a result of such taking shall be paid as provided by the law of the State of California. 11/11/92 ATTACHMENT NO. 7 6449u/2460/09 Page 6 of 14 ARTICLE V REPRESENTATIONS, COVENANTS AND WARRANTIES OF THE TRUSTOR Section 5.1 Defense of the Title. The Trustor covenants that it is lawfully seized and possessed of title in fee simple to the Site, that it has good right to sell, convey or otherwise transfer or encumber the same, and that the Trustor, for itself and its successors and assigns, warrants and will forever defend the right and title to the foregoing described and conveyed property unto the Beneficiary, its successors and assigns, against the claims of all persons whomsoever, excepting only encumbrances approved by the Beneficiary. Section 5.2 Inspection of the Project. The Trustor covenants and agrees that at any and all reasonable times and upon reasonable notice, the Beneficiary and its duly authorized agents, attorneys, experts, engineers, accountants and representatives, shall have the right, without payment of charges or fees, to inspect the Site. ARTICLE VI AGREEMENTS AFFECTING THE PROJECT; FURTHER ASSURANCES Section 6.1 Other Agreements Affecting Project. The Trustor shall duly and punctually perform all terms, covenants, conditions and agreements binding upon it under the Agreement or any other agreement of any nature whatsoever now or hereafter involving or affecting the Site or any part thereof. Section 6.2 Further Assurances; After Acquired Property. At any time, and from time to time, upon request by the Beneficiary, the Trustor shall make, execute and deliver, or cause to be made, executed and delivered, to the Beneficiary and, where appropriate, cause to be recorded and/or filed, and from time to time thereafter to be recorded and/or filed, and from time to time thereafter to be rerecorded and/or refiled, at such time and in such offices and places as shall be deemed desirable by the Beneficiary, any and all such other and further deeds of trust, security agreements, financing statements respecting personal property, instruments of further assurance, certificates and other documents as may, in the opinion of the Beneficiary, be necessary or desirable in order to effectuate, complete or perfect, or to continue and preserve, (a) the obligations of the Trustor under this Deed of Trust, and (b) the lien of this Deed of Trust as a lien prior to all liens except those obligations which shall be senior obligations pursuant to the provisions of this Deed of Trust. Upon any failure by the Trustor to do so, the Beneficiary may make, execute, record, file rerecord and/or refile any and all such deeds of trust, security agreements, instruments, certificates and documents for and in the name of the Trustor, and the Trustor hereby irrevocably appoints the Beneficiary the agent and attorney-in-fact of the Trustor to do so. The lien hereof shall automatically attach, without further act, to all after-acquired property deemed to be part of the Security as defined herein. 11/11/92 ATTACHMENT NO. 7 6449u/2460/09 Page 7 of 14 Section 6.3 Agreement to Pay Attorney's Fees and Expenses. In the event of an Event of Default hereunder, and if the Beneficiary should employ attorneys or incur other expenses for the collection of amounts due or the enforcement of performance or observance of an obligation or agreement on the part of the Trustor in this Deed of Trust, the Trustor agrees that it will, on demand therefor, pay to the Beneficiary the reasonable fees of such attorneys and such other reasonable expenses so incurred by the Beneficiary; and any such amounts paid by the Beneficiary shall be added to the indebtedness secured by the lien of this Deed of Trust, and shall bear interest from the date such expenses are incurred at the maximum rate permitted by Section 1(2) of Article XV of the California Constitution. Section 6.4 Subrogation; Payment of Claims. Provided that the Beneficiary gives notice of at least five (5)business days to the Trustor, the Beneficiary shall be subrogated to the claims and liens of all parties whose claims or liens are discharged or paid by the Beneficiary pursuant to the provisions hereof. If permitted in the Mortgage, the Beneficiary shall have the right to pay and discharge the obligations secured by the Mortgage. Section 6.5 Operation of the Site. The Trustor agrees and covenants to operate the Site in full compliance with the Agreement and the Covenants. Section 6.6 Transfer. No sale, transfer, lease. pledge, encumbrance, creation of a security interest in or other hypothecation of the Security shall relieve or release the Trustor from primary liability under this Deed of Trust, the Promissory Note, the Agreement or the Covenants, as the case may be. Section 6.7 Subordination. This Deed of Trust is hereby subordinated by Beneficiary to all future loans for construction and permanent financing to be in first position on the Site. ARTICLE VII EVENTS OF DEFAULT AND REMEDIES Section 7.1 Events of Default Defined. The occurrence of any failure of the Trustor to perform under this Deed of Trust, the Agreement or the Covenants, and the continuation of said failure for a period of thirty (30) days after written notice specifying such failure and requesting that it be remedied shall have been given to Trustor from the Beneficiary pursuant to the Agreement, shall be an Event of Default under this Deed of Trust. Section 7.2 Acceleration of Maturity. If an Event of Default shall have occurred and be continuing, then the entire indebtedness secured hereby shall, at the option of the Beneficiary, immediately become due and payable without notice or demand which are hereby expressly waived, and no omission on the part of the Beneficiary to exercise such option when entitled to do so shall be construed as a waiver of such right. Section 7.3 The Beneficiary's Right to Enter and Take Possession. If an Event of Default shall have occurred and be continuing, the Beneficiary may: 11/11/92 ATTACHMENT No. 7 6449u/2460/09 Page 8 of 14 (a) Either in person or by agent, with or without bringing any action or proceeding, or by a receiver appointed by a court, and without regard to the adequacy of its security, enter upon the Site and take possession thereof (or any part thereof) and of any of the Security, in its own name or in the name of Trustee, and do any acts which it deems necessary or desirable to preserve the value, marketability or rentability of the Site, or part thereof or interest therein, increase the income therefrom or protect the Security hereof and, with or without taking possession of the Site, sue for or otherwise collect the rents, issues and profits thereof, including those past due and unpaid, and apply the same, less costs and expenses of operation and collection, including attorneys' fees, upon any indebtedness secured hereby, all in such order as Beneficiary may determine. The entering upon and taking possession of the Site, the collection of such rents, issues and profits and the application thereof, as aforesaid, shall not cure or waive any- Default or notice of Default hereunder or invalidate any act done in response to such Default or pursuant to such notice of Default and, notwithstanding the continuance in possession of the Site or the collection, receipt and application of rents, issues or profits, Beneficiary shall be entitled to exercise every right provided for in this Deed of Trust, the Agreement or by law upon occurrence of any Event of Default, including the right to exercise the power of sale. Trustor requests that a copy of any Notice of Default and a copy of any Notice of Sale hereunder be mailed to him at his address given herein; (b) Commence an action to foreclose this Deed of Trust as a mortgage, appoint a receiver, or specifically enforce any of the covenants hereof; (c) Deliver to Trustee a written declaration of default and demand for sale, and a written notice of default and election to cause Trustor's interest in the property to be sold, which notice Trustee or Beneficiary shall cause to be duly filed for record in the Official Records of the County in which the Site is located; or (d) Exercise all other rights and remedies provided herein, in the instruments by which the Trustor acquires title to the Site, including any Security, or in any other document or agreement now or hereafter evidencing, creating or securing all or any portion of the obligations secured hereby, or provided by law. Section 7.4 Foreclosure By Power of Sale. Should the Beneficiary elect to foreclose by exercise of the power of sale herein contained, the Beneficiary shall notify Trustee and shall deposit with Trustee this Deed of Trust which is secured hereby (and the deposit of which shall be deemed to constitute evidence that the Note Amount is immediately due and payable) , and such receipts and evidence of any expenditures made that are additionally secured hereby as Trustee may require. (a) Upon receipt of such notice from the Beneficiary, Trustee shall.cause to be recorded, published and delivered to Trustor such Notice of Default and Election to Sell as then required by law and by this Deed of Trust. Trustee shall, without demand on Trustor, after lapse of such time as may then be. required by law and after recordation of such Notice of Default and after Notice of Sale having been given as required by law, sell the Site, at the 11/11/92 ATTACHMENT NO. 7 6449u/2460/09 Page 9 of 14 time and place of sale fixed by it in said Notice of Sale, either as a whole or in separate lots or parcels or items as Trustee shall deem expedient and in such order as it may determine, at public auction to the highest bidder, for cash in lawful money of the United States payable at the time of sale. Trustee shall deliver to such purchaser or purchasers thereof its good and sufficient deed or deeds conveying the property so sold, but without any covenant or warranty, express or implied. The recitals in such deed of any matters or facts shall be conclusive proof of the truthfulness thereof. Any person, including, without limitation, Trustor, Trustee or Beneficiary, may purchase at such sale, and Trustor hereby covenants to warrant and defend the title of such purchaser or purchasers. (b) After deducting all reasonable costs, fees and expenses of Trustee, including costs of evidence of title in connection with such sale, Trustee shall apply the proceeds of sale to payment of: (i) the Note Amount; (ii) all other sums then secured hereby; and (iii) the remainder, if any, to the person or persons legally entitled thereto. (c) Trustee may postpone sale of all or any portion of the Site by public announcement at such time and place of sale, and from time to time thereafter, and without further notice make such sale at the time fixed by the last postponement, or may, in its discretion, give a new notice of sale. Section 7.5 Receiver. If an Event of Default shall have occurred and be continuing, Beneficiary, as a matter of right and without further notice to Trustor or anyone claiming under Security, and without regard to the then value of the Site or the interest of Trustor therein, shall have the right to apply to any court having jurisdiction to appoint a receiver or receivers of the Security (or a part thereof) , and Trustor hereby irrevocably consents to such appointment and waives further notice of any application therefor. Any such receiver or receivers shall have all the powers and duties of receivers in like or similar cases, and all the powers and duties of Beneficiary in case of entry as provided herein, and shall continue as such and exercise all such powers until the date of confirmation of sale of the Site, unless such receivership is sooner terminated. Section 7.6 Remedies Cumulative. No right, power or remedy conferred upon or reserved to the Beneficiary by this Deed of Trust is intended to be exclusive of any other right, power or remedy, but each and every such right, power and remedy shall be cumulative and concurrent and shall be in addition to any other right, power and remedy given hereunder or now or hereafter existing at law or in equity. Section 7.7 No Waiver. (a) No delay or omission of the Beneficiary to exercise any right, power or remedy accruing upon any Default shall exhaust or impair any such right, power or remedy, or shall be construed to be a waiver of any such Default or acquiescence therein; and every right, power and remedy given by this Deed of Trust to the Beneficiary may be exercised from time to time and as often as may be deemed expeditious by the.Beneficiary. No consent or waiver, expressed or implied, by the Beneficiary to or of any breach by the Trustor in the performance of the obligations hereunder shall be deemed or construed to be a 11/11/92 ATTACHMENT NO. 7 6449u/2460/09 Page 10 of 14 consent to or waiver of obligations of the Trustor hereunder. Failure on the part of the Beneficiary to complain of any act or failure to act or to declare an Event of Default, irrespective of how long such failure continues, shall not constitute a waiver by the Beneficiary of its right hereunder or impair any rights powers or remedies consequent on any breach or Default by the Trustor. (b) If the Beneficiary (i) grants forbearance or an extension of time for the payment of any sums secured hereby, (ii) takes other or additional security or the payment of any sums secured hereby, (iii) waives or does not exercise any right granted herein, or in the Agreement, (iv) releases any part of the Security from the lien of this Deed of Trust, or otherwise changes any of the terms, covenants, conditions or agreements of this Deed of Trust or the Agreement, (v) consents to the filing of any map, plat or replat affecting the Security, (vi) consents to the granting of any easement or other right affecting the Security, or (vii) makes or consents to any agreement subordinating the lien hereof, any such act or omission shall not release, discharge, modify, change or affect the original liability under this Deed of Trust, or any other obligation of the Trustor or any subsequent purchaser of the Security or any part thereof, or any maker, co-signer, endorser, surety or guarantor (unless expressly released); nor shall any such act or omission preclude the Beneficiary from exercising any right, power or privilege herein granted or intended to be granted in the event of any Default then made or of any subsequent Default, nor, except as otherwise expressly provided in an instrument or instruments executed by the Beneficiary shall the lien of this Deed of Trust be altered thereby. In the event of the sale or transfer by operation of law or otherwise of all or any part of the Site, the Beneficiary, without notice, is hereby authorized and empowered to deal with any such vendee or transferee with reference to the Security (or a part thereof) or the indebtedness secured hereby, or with reference to any of the terms, covenants, conditions or agreements hereof, as fully and to the same extent as it might deal with the Trustor and without in any way releasing or discharging any liabilities, obligations or undertakings of the Trustor. Section 7.8 Suits to Protect the Securit . The Beneficiary shall have power upon ninety 90) days notice to the Trustor) to (a) institute and maintain such suits and proceedings as it may deem expedient to prevent any impairment of the Security (and the rights of the Beneficiary as secured by this Deed of Trust) by any acts which may be unlawful or any violation of this Deed of Trust, (b) preserve or protect its interest (as described in this Deed of Trust) in the Security and in the rents, issues, profits and revenues arising therefrom, and (c) restrain the enforcement of or compliance with any legislation or other governmental enactment, rule or order that may be unconstitutional or.otherwise invalid, if the enforcement for compliance with such enactment, rule or order would impair the security thereunder or be prejudicial to the interests of the Beneficiary. Section 7.9 Trustee May File Proofs of Claim. In the case of any receivership, insolvency, bankruptcy, reorganization, arrangement, adjustment, composition or other proceedings affecting the Trustor, its creditors or its property, the Beneficiary, to the extent permitted by law, shall be entitled to file such proofs of claim and other documents as may be necessary or advisable in order to have the claims of the Beneficiary allowed in such 11/11/92 ATTACHMENT NO. 7 6449u/2460/09 Page 11 of 14 proceedings for the entire amount due and payable by the Trustor under this Deed of Trust at the date of the institution of such proceedings and for any additional amount which may become due and payable by the Trustor hereunder after such date. ARTICLE VIII MISCELLANEOUS Section 8.1 Amendments. This instrument cannot be waived, changed, discharged or terminated orally, but only by an instrument in writing signed by the party against whom enforcement of any waiver, change, discharge or termination is sought. Section 8.2 Trustor Waiver of Rights. Trustor hereby acknowledges that it is aware of and has the advice of counsel of its choice with respect to its rights under the Constitution of the United States, including, but not limited to, its rights arising under the Fourth, Fifth, Sixth and Fourteenth Amendments thereto, and the Constitution of the State of California. Trustor agrees that Beneficiary may exercise its rights hereunder in accordance with the provisions hereof, including, but not limited to, the exercise of the power of sale pursuant to Section 7.4 hereof, and Trustor hereby expressly waives and releases its rights under such Constitutions with respect thereto, including, but not limited to, its rights, if any, to notice and a hearing upon the occurrence of an Event of Default hereunder; provided, however, nothing contained herein shall be deemed to be a waiver of Trustor's rights to reinstate or redeem this Deed of Trust in accordance with applicable law. Trustor further waives to the extent permitted by law, (a) the benefit of all laws now existing or that may hereafter be enacted providing for any appraisement before sale of any portion of the Security, (b) all rights of valuation, appraisement, stay of execution, notice of election to mature or declare due the whole of the secured indebtedness and marshaling in the event of foreclosure of the liens hereby created, and (c) all rights and remedies which Trustor may have or be able to assert by reason of the laws of the State of California pertaining to the rights and remedies of sureties. Section 8.3 Reconveyance and Partial Reconveyances by Trustee. Upon written request of Beneficiary stating that all sums secured hereby have been paid and that all performance obligations secured hereby have been performed to Agency's satisfaction, and upon surrender of this Deed of Trust to Trustee for cancellation and retention, and upon payment by Trustor of Trustee's reasonable fees Trustee shall reconve to Trustor, or to the y person or persons legally entitled thereto, without warranty, any portion of the Property then held hereunder. The recitals in such reconveyance of any matters or facts shall be conclusive proof of the truthfulness thereof. The grantee in any reconveyance may be described as "the person or person legally entitled thereto." Beneficiary shall cause Trustee to release and execute partial reconveyances of any one or more of the parcels comprising the Property described in the Exhibit "A" attached hereto from the lien of this Deed of Trust on satisfaction of each of the following conditions: 11/11/92 ATTACHMENT NO. 7 6449u/2460/09 Page 12 of 14 (a) No release will be given if a Notice of Default then appears of record. (b) Each request shall be in writing delivered personally or mailed, certified mail, return receipt requested, to Trustee and to Beneficiary and shall identify the parcel(s) to be reconveyed. (c) Trustor shall pay all costs required in connection with execution and recording of the reconveyance. (d) Trustor shall have, at Trustor's sole expense, fully complied with all applicable federal, state and local laws, ordinances and rules, including without limitation, the California Subdivision Map Act. (e) Prior to approving reconveyance on the final five units secured by this Deed of Trust Trustor shall provide an accounting to the Beneficiary of Development Costs and Net Profit pursuant to the profit participation provisions set out in Attachment No. 12 of the Agreement. The release of all units prior to the last five shall be made without consideration or payment of any profit participation. Section 8.4 Notices. Whenever Beneficiary, Trustor or Trustee shall desire to give or serve any notice, demand, request or other communication with respect to this Deed of Trust, each such notice, demand, request, or other communication shall be in writing and shall be effective only if the same is delivered by personal service or mailed by registered or certified mail, postage prepaid, return receipts requested, or by telegram, addressed to the address set forth in the first paragraph of this Deed of Trust. Any party may at any time change its address for such notices by delivering or mailing to the other parties hereto, as aforesaid, a notice of such change. Section 8.5 Acceptance by Trustee. Trustee accepts this Trust when this Deed of Trust, duly executed and acknowledged, is made a public record as provided by law. Section 8.6 Captions. The captions or headings at the beginning of each Section hereof are for the convenience of the parties and are not a part of this Deed of Trust. Section 8.7 Invalidity of Certain Provisions. Every provision of this Deed of Trust is intended to be severable. In the event any term or provision hereof is declared to be illegal or invalid for any reason whatsoever by a court of competent jurisdiction, such illegality or invalidity shall not affect the balance of the terms and provisions hereof, which terms and provisions shall remain binding and enforceable. If the lien of this Deed of Trust is invalid or unenforceable as to any part of the debt, or if the lien is invalid or unenforceable as to any part of the Security, the unsecured or partially secured portion of the debt, and all payments made on the debt, whether voluntary or under foreclosure or other enforcement action or procedure, shall be considered to have been first paid on and applied to the full payment of that portion of the debt which is not secured or partially secured by the lien of this Deed of Trust. 11/11/92 ATTACHMENT NO. 7 6449u/2460/09 Page 13 of 14 Section 8.8 No Merger. If title to the Property shall become vested in the Beneficiary, this Deed of Trust and the lien created hereby shall not be destroyed or terminated by application of the doctrine of merger and, in such event, Beneficiary shall continue to have and enjoy all of the rights and privileges of Beneficiary under this Deed of Trust. In addition, upon foreclosure under this Deed of Trust pursuant to the provisions hereof, any leases or subleases then existing and affecting all or any portion of the Security shall not be destroyed or terminated by application of the law of merger or as a matter of law or as a result of such foreclosure unless Beneficiary or any purchaser at any such foreclosure shall so elect. No act by or on behalf of Beneficiary or any such purchaser shall constitute a termination of any lease or sublease unless Beneficiary or such purchaser shall give written notice of termination to such tenant or subtenant. Section 8.9 Governing Law. This Deed of Trust shall be governed by and construed in accordance with the laws of the State of California. Section 8.10 Gender and Number. In this Deed of Trust the singular shall include the plural and the masculine shall include the feminine and neuter and vice versa, if the context so requires. IN WITNESS WHEREOF, Trustor has executed this Deed of Trust as of the day and year first above written. COULTRUP COMPANIES, a California corporation By: Jon T. Coultrup, President BIRTCHER REAL ESTATE LIMITED, a California limited partnership By: BREICORP, a California corporation, Managing General Partner By: Michael H. Voss, President 11/11/92 ATTACHMENT NO. 7 6449u/2460/09 Page 14 of 14 STATE OF CALIFORNIA ) ss. COUNTY OF ) On 199 before me, the undersigned, a Notary Public in and for said State, personally appeared , personally known to me or proved to me on the basis of satisfactory evidence to be the person whose name is subscribed to the within instrument and acknowledged that executed the same. WITNESS my hand and official seal. (SEAL) STATE OF CALIFORNIA ) ss. COUNTY OF ) On 199 before me, the undersigned, a Notary Public in and for said State, personally appeared , personally known to me or proved to me on the basis of satisfactory evidence to be the person whose name is subscribed to the within instrument and acknowledged that executed the same. WITNESS my hand and official seal. (SEAL) 11/11/92 6449u/246O/O9 ATTACHMENT NO. 7 EXHIBIT A LEGAL DESCRIPTION OF THE SITE 11/11/92 6449u/2460/09 EXHIBIT A to ATTACHMENT NO. 7 ATTACHMENT NO. 8 RECORDING REQUESTED BY ) AND WHEN RECORDED MAIL TO: ) [Space above for recorder. ] CERTIFICATE OF COMPLETION FOR .CONSTRUCTION AND DEVELOPMENT WHEREAS, by Grant Deed dated and recorded on as No. of the official records of the County Recorder of the County of Orange, California (the "Grant Deed") , the REDEVELOPMENT AGENCY OF THE CITY OF HUNTINGTON BEACH, a public body corporate and politic, hereinafter referred to as "Agency", conveyed to COULTRUP COMPANIES and BIRTCHER REAL ESTATE LIMITED, hereinafter referred to as the "Developer", title to certain real property situated in the City of Huntington Beach, California which property was assembled with property of the Developer (collectively the "Site" ) as described on Exhibit "A" attached hereto and made a part hereof; and WHEREAS, pursuant to a Disposition and Development Agreement by and between the Agency and the Developer dated as of , a copy of which is on file with the Agency as a public record at its offices at City Hall, 2000 Main Street, Huntington Beach, California (the "DDA" ) , and is incorporated herein by reference the Developer and the Agency carried out the development of the Site; and WHEREAS, as referenced in said Grant Deed, the Agency shall furnish the Developer with a Certificate of Completion upon completion of construction, which certificate shall be in such form as to permit it to be recorded in the Recorder' s Office of Orange County; and WHEREAS, such certificate shall be conclusive determination Of satisfactory completion of the construction of the Developer Improvements required by the DDA and the Grant Deed; and 11/11/92 ATTACHMENT NO. 8 6449u/2460/09 Page 1 of 2 WHEREAS, the Agency has conclusively determined that the construction of the Developer Improvements on the above described real property required by the DDA and the Grant Deed has been satisfactorily completed. NOW THEREFORE, 1. As provided in the DDA, the Agency does hereby certify that the construction of the Developer Improvements has been fully and satisfactorily performed and completed. 2. Nothing contained in this instrument shall modify in any other way any other provisions of the Grant Deed or the DDA. IN WITNESS WHEREOF, the Agency has executed this certificate this day of 19 REDEVELOPMENT AGENCY OF THE CITY OF HUNTINGTON BEACH, a public body corporate and politic By: ATTEST: 11/11/92 ATTACHMENT NO. 8 6449u/2460/09 Page 2 of 2 EXHIBIT "A" LEGAL DESCRIPTION OF THE PROPERTY 11/11/92 EXHIBIT A to ATTACHMENT NO. 8 6449u/2460/09 Page 1 of 1 ATTACHMENT NO. 8-A RECORDING REQUESTED BY ) AND WHEN RECORDED MAIL TO: ) [Space above for Recorder. ] This document is exempt from the payment of a recording fee pursuant to Government Code Section 6103. REDEVELOPMENT AGENCY OF THE CITY OF HUNTINGTON BEACH By: Its: Dated: 19 PARTIAL CERTIFICATE OF COMPLETION THIS PARTIAL CERTIFICATE OF COMPLETION (the "Certificate") is made by the REDEVELOPMENT AGENCY OF THE CITY OF HUNTINGTON BEACH, a public body corporate and politic (the "Agency" ) in favor of the a California partnership (the "Developer") , as of the date set forth below. RECITALS A. The Agency and the Developer have entered into that certain Disposition and Development Agreement ("DDA" ) dated JI 1992 concerning the development of certain real property situated in the City of Huntington Beach, California. Pursuant to the DDA, the Agency has conveyed certain real property to the Developer for development purposes (the "Parcel" ) . B. As referenced in Section of the DDA, the Agency may furnish the Developer or its successors with a Partial Certificate of Completion at the sole discretion of the Agency Executive Director, which certificate shall be in such form as 11/11/92 ATTACHMENT NO. 8-A 6449u/2460/09 Page 1 of 3 to permit it to be recorded in the official records of Orange County. This Partial Certificate of Completion is required to be conclusive determination of satisfactory completion of the construction and development required by the DDA only as to the individual parcel or unit which is described in Exhibit "A" attached hereto and incorporated herein by reference (the "Completed Parcel or Unit") . C. The Agency has conclusively determined that such construction and development as to the Completed Parcel or Unit has been satisfactorily completed. NOW, THEREFORE, the Agency hereby certifies as follows: 1. The Improvements to be constructed by the Developer on the Completed Parcel or Unit have been fully and satisfactorily completed in conformance with the DDA. This Certificate is not a determination by the Agency of the completion of construction or development of any other Improvements to be constructed on the Parcel, other than the Completed Parcel or Unit, which have been or will be conveyed from the Agency to the Developer pursuant to the DDA. Any use, operation, or maintenance requirements of the DDA shall remain enforceable according to their terms. 2. Except as provided herein, nothing contained in this instrument shall modify in any other way any other provisions of the DDA. 3. This Partial Certificate of Completion shall not constitute evidence of compliance with or satisfaction of any obligation of the Developer to any holder of any mortgage, or any insurer of a mortgage loaned to finance the Improvements, or any part thereof. 4. This Partial Certificate of Completion is not a notice of completion as referred to in California Civil Code Section 3093. IN WITNESS WHEREOF, the Agency has executed this certificate this day of , 19_ REDEVELOPMENT AGENCY OF THE CITY OF HUNTINGTON BEACH, a public body corporate and politic By: Its: 11/11/92 ATTACHMENT NO. B-A 6449u/2460/09 Page 2 of 3 ATTEST: Agency Secretary APPROVED AS TO FORM: Stradling, Yocca, Carlson & Rauth, Agency Special Counsel 11/11/92 ATTACHMENT NO. 8-A 6449u/2460/09 Page 3 of 3 EXHIBIT "A" ' LEGAL DESCRIPTION [To Be Inserted] 11/11/92 EXHIBIT "A" TO 6449u/2460/09 ATTACHMENT NO. 8-A i STATE OF CALIFORNIA ) ss. COUNTY OF ORANGE ) On this day of 19 , before me, the undersigned, a Notary Public in and for said State, personally appeared , personally known to me (or proved to me on the basis of satisfactory evidence) to be the person who executed this instrument as the of the REDEVELOPMENT AGENCY OF THE CITY OF HUNTINGTON BEACH, a public body corporate and politic, and acknowledged to me that said Agency executed it. WITNESS my hand and official seal. (SEAL) 11/11/92 6449u/2460/09 ATTACHMENT NO. 8-A ATTACHMENT NO. 9 RECORDING REQUESTED BY ) AND WHEN RECORDED MAIL TO: ) [Space above for recorder.] This Agreement is recorded at the request and for the benefit of the Agency and is exempt from the payment of a recording fee pursuant to Government Code Section 6103. REDEVELOPMENT AGENCY OF THE CITY OF HUNTINGTON BEACH By: • Its: Dated: 19 DECLARATION OF COVENANTS, CONDITIONS, AND RESTRICTIONS THIS DECLARATION OF COVENANTS, CONDITIONS, AND RESTRICTIONS (the "Declaration") is entered into this day of , 199' , by and between the REDEVELOPMENT AGENCY OF THE CITY OF HUNTINGTON BEACH, a public body corporate and politic (the "Agency") , and COULTRUP COMPANIES, a California corporation AND BIRTCHER REAL ESTATE LIMITED, a California limited partnership (the "Developer"), with reference to the following: A. The Developer is fee owner of record of that certain real property (the "Site") located in the City of Huntington Beach, County of Orange, State of California legally described in the attached Exhibit "A". The Site is the subject of a Disposition and Development Agreement between the Agency and the Developer (the "Agreement"). B. The Site is within the Main Pier Redevelopment Project Area (the "Project") in the City of Huntington Beach and is subject to the provisions of the "Redevelopment Plan" for the Project adopted by Ordinance No. 2578 as amended by Ordinance Number 2634 by the City Council of the City of Huntington Beach. 11/11/92 ATTACHMENT NO. 9 1927Q/2460/09 Page 1 of 9 C. The Agreement provides for the execution and recordation of this document. Except as otherwise expressly provided in this Agreement, all terms shall have the same meanings as set forth in the Agreement. NOW, THEREFORE, THE AGENCY AND THE DEVELOPER AGREE AS FOLLOWS: 1. Developer hereby covenants and agrees that all uses of the Site shall be consistent with the Main Pier Redevelopment Plan. 2. Non-Discrimination The Developer, on behalf of itself and its successors, assigns, and each successor in interest to the Site or any part thereof, hereby covenants and agrees: (a) To use, devote, operate and maintain the Site and each part thereof, for the purposes and the residential uses specified in the Agreement and in the Redevelopment Plan. (b) Not to discriminate upon the basis of sex, marital status, race, color, creed, religion, national origin, or ancestry in the sale, lease, sublease, transfer or rental, or in the use, occupancy, tenure, or enjoyment of the Site or any improvements thereon, or of any part thereof. Each and every deed, lease, and contract entered into with respect to the Site shall contain or be subject to substantially the following nondiscrimination or nonsegregation clauses: (1) In deeds: "The grantee herein covenants by and for itself, it successors and assigns, and all persons claiming under or through them, that there shall be no discrimination against or segregation of any person or group of persons on account of sex, marital status, race, color, creed, religion, national origin, or ancestry in the sale, lease, rental, sublease, transfer, use occupancy, tenure, or enjoyment of the land herein conveyed, nor shall the grantee itself or any persons claiming under or through it, establish or -permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees, or vendees in the land herein conveyed. The foregoing covenants shall run with the land." (2) In leases: "The lessee herein covenants by and for itself, its successors and assigns, and all persons claiming under or through them, and this lease is made and accepted upon and subject to the following conditions: That there shall be no discrimination against or segregation of any person or group of persons, on account of sex, marital status, race, color, creed, religion, national origin, or ancestry, in the leasing, renting, subleasing, transferring, use, occupancy, tenure, or 11/11/92 ATTACHMENT NO. 9 1927Q/2460/09 Page 2 of 9 enjoyment of the land herein leased nor shall the lessee itself, or any person claiming under or through it, establish or permit such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, sublessees, subtenants, or vendees in the land herein leased." (3) In contracts: 'There shall be no discrimination against or segregation of, any persons, or group of persons on account of sex, marital status, race, color, creed, religion, national origin, or ancestry in the sale, lease, rental, sublease, transfer, use, occupancy, tenure or enjoyment of the land, nor shall the transferee itself or any person claiming under or through it, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees or vendees of the land.11 3. Inspection. To the extent permitted by law, the City of Huntington Beach and the Agency shall have the right of entry, at reasonable hours and upon no less than thirty (30) days advance notice, onto the Site to inspect for the need for repairs or maintenance. Entry onto the Site or into any unit for other than emergency repairs may be made only after such advance notice and request for entry. If request for entry is denied or the Site or applicable unit is unoccupied, the City or Agency may apply for an appropriate warrant or other order from a court of appropriate jurisdiction. 4. Exterior Maintenance. The exterior areas of the Site shall be kept free of rubbish, debris and other unsightly or unsanitary materials. The requirements in this Section shall also be incorporated into any covenants, conditions and restrictions which are administered by an association of owners in the Site or any portion of the Site. a. Project Improvement, Maintenance and Repair - (1) Land Use Areas and Improvements (a) Exterior yard areas and parking areas shall be kept free of deterioration, including: (i) Potholes (ii) Cracks in asphalt so as to become uneven, unsightly surface conditions 11/11/92 ATTACHMENT NO. 9 1927Q/2460/09 Page 3 of 9 J (iii) Weeds growing through asphalt. (b) Perimeter fencing, landscaping and irrigation system shall be routinely inspected and maintained in good condition. b. Each occupant of the Site shall have the affirmative obligation to prevent what might be considered a fire hazard or a condition dangerous to the public health, safety and limited welfare; or constitute an unsightly appearance or otherwise detract from the aesthetic and property values of neighboring dwelling units and properties. The following minimum performance standards for the maintenance of buildings, yards, and landscaping shall be adhered to by the Developer: (1) Landscaping on the Site shall be absent of the following: (a) Lawns with grasses in excess of six (6) inches in height. (b) Untrimmed hedges. (c) Trees, shrubbery, lawns and other plant life dying from lack of water or other necessary maintenance. (d) Trees and shrubbery grown uncontrolled without proper pruning. (e) Vegetation so overgrown as to be likely to harbor rats or vermin. (f) Dead, decayed or diseased trees, weeds and other vegetation. (g) Inoperative irrigation system(s) . (2) Yard areas shall be maintained so as to be absent of the following: (a) Broken or discarded furniture, appliances and other household equipment stored in yard areas for periods exceeding one (1) week. (b) Packing boxes, lumber, trash, dirt and other debris stored in yards for unreasonable periods in areas visible from public property or neighboring properties. (c) Unscreened trash cans, bins or containers stored for unreasonable periods in areas visible from public streets and common areas. 11/11/92 ATTACHMENT NO. 9 1927Q/2460/09 Page 4 of 9 (3) No building, wall or fence may be left in an unmaintained condition so that any of the following exist: (a) Buildings abandoned, boarded up, partially destroyed or left unreasonably in a state of partial construction. (a) Unpainted buildings or buildings with peeling paint in such a condition as to: i. Cause dry rot, warping and termite infestation; or ii. Constitute an unsightly appearance that detracts from the aesthetic or property values of neighboring properties. (c) Broken windows, constituting hazardous conditions and/or inviting trespassers and malicious mischief. (d) Damaged garage doors that may become inoperative or unsafe to operate. (e) Graffiti remaining on any portion of the property for a period exceeding five (5) days. (f) Building interiors and exteriors shall be maintained to meet standards of similar residential property in the City of Huntington Beach. 5. Agency and City Right of Review and Enforcement The Agency is a party to this Declaration and the City of Huntington Beach ("City") is hereby expressly made a third party beneficiary to this Declaration for the limited purposes as specified herein as follows: a. Changes or amendments to this Declaration must be submitted for City and Agency review and approval. b. In the event of inaction by the Developer, the City and Agency are hereby granted expedient power to enforce all provisions of this Declaration including, but not limited to, the maintenance of the Improvements and all yards, buildings and landscaping areas within the Site. All costs and expenses incurred by the City and/or the Agency arising out of such enforcement and maintenance shall be charged as an expense of the Developer or its successor in interest and shall be paid within ten (10) days of receipt of an invoice for same. C. The City and Agency are hereby granted the express power to enforce all laws and ordinances of the State of California and/or the City of Huntington Beach on yards, structures, and private parking areas within the Site. Nothing within this Declaration, however, shall be construed as imposing an obligation or requiring the City or Agency to enforce any provision thereof. 11/11/92 ATTACHMENT NO. 9 1927Q/2460/09 Page 5 of 9 d. The City and the Agency shall be given prior written notice of any proposed amendment to this Declaration. Such notice shall be given by mailing a copy of the precise language of the proposed amendment to the City of Huntington Beach, c/o City Clerk, together with a letter of transmittal explaining the proposed change in limited terms. The City and the Agency shall have an opportunity to review and comment upon the proposed amendment for a period of not less than forty-five (45) days prior to the effective date of any such proposed amendment. If the City or Agency fail to respond within forty-five (45) days, the proposed change(s) and amendment(s) shall be deemed approved, unless that time period is extended by mutual agreement of all parties. 6. City of Huntington Beach Right of Entry for Code Enforcement, Repair and Traffic Regulation (a) Right of Entry. To the extent permitted by law, Developer hereby acknowledges and intends and thus grants to the City and the Agency, through the City's duly authorized agents or employees, the right to enter upon the Site for the following purposes: (1) Inspection, maintenance and repair of the Site. (2) Enforcement of local traffic and/or parking regulations. (b) Reimbursements of City Expenditures. All costs and expenses incurred by the City and/or the Agency arising out of its inspection, maintenance and repair of the Site, as provided hereinabove ("City Maintenance Costs") , shall be charged as an expense of the Developer or its successor in interest and shall be paid within ten (10) days of receipt of an invoice for same. (c) Assessments and Lien Rights of the City. If City Maintenance Costs and/or those costs incurred relating to enforcement or maintenance as set forth in Section 10 above of this Article are not paid within thirty (30) days from the date due, said unpaid costs and expenses shall become a special assessment against the Site and, upon confirmation by the City Council, shall be collected in the same manner as real property taxes and shall be subject to the same penalties, procedures and sale in case of delinquency as is provided for real property taxes. 7. Mortgage Protection Notwithstanding any and all provisions elsewhere in this Declaration to the contrary, in order to induce lenders and investors to participate in the financing of the Developer Improvements, the following provisions are added hereto, and, except as to the effectiveness and enforceability of the Affordable Unit requirements set forth herein, to the extent these added provisions conflict with any other provisions of this Declaration, these added provisions shall control: 11/11/92 ATTACHMENT NO. 9 1927Q/2460/09 Page 6 of 9 (a) Any mortgagee or third party foreclosure purchaser who comes into possession or who obtains title to the Site pursuant to the remedies provided in the mortgage or foreclosure of the mortgage, or by deed or assignment in lieu of foreclosure, will not be liable for such Site's unpaid charges which accrue prior to such possession or acquisition of title. The assessment liens provided for herein shall be subordinate to the lien or equivalent security interest of any mortgage recorded prior' to the date any such charges become due. Such subordination shall apply only to assessments which accrue prior to a sale or transfer of such Site pursuant to a decree of foreclosure or trustee's sale. Such sale or transfer shall not relieve such Site from liability for any assessments thereafter becoming due or from the lien of any such subsequent assessment. . (b) Mortgagees shall have the right to examine the books and records of the Developer during normal business hours. (c) In the event of substantial damage to or destruction of the Site or any portion thereof, the mortgagee of any mortgage on the Site shall be entitled to timely written notice of any such damage or destruction, and no provision in this Declaration shall be interpreted to entitle the Developer or any other party to priority over any rights of the mortgagee of the Site pursuant to its mortgage in the case of a distribution to such Developer of insurance proceeds or condemnation awards for losses to or a taking of the Site. (d) If the Site or portion thereof is made the subject matter of any condemnation or eminent domain proceeding or is otherwise sought to be acquired by a condemning authority, then the mortgagee of any mortgage will be entitled to timely written notice of any such proceeding or proposed acquisition, and no provision in this Declaration shall be interpreted to entitle the Developer or any other party to priority over such mortgagee with respect to the distribution to such lot of the proceeds of any award or settlement. (e) As used in this Section 12, "mortgagee" means any mortgagee under a mortgage which is a lien of record made in good faith and for value, or a junior lien of record made in good faith and for value by the City, the Agency or an institutional lender in order to assist in the financing of the construction of the Improvements. (f) No violation of this Declaration shall render invalid or defeat the mortgage of the first mortgagee. 8. Miscellaneous Provisions a. If any provision of this Declaration or portion thereof, or the application to any person or circumstances, shall to any extent be held invalid, inoperative or unenforceable, the remainder of this Declaration, or the application of such provision or portion thereof to any other persons or circumstances, shall not be affected thereby; it shall not be deemed that any such invalid provision affects the consideration for this Declaration; and each provision of this Declaration shall be valid and enforceable to the fullest extent permitted by law. 11/11/92 ATTACHMENT NO. 9 1927Q/2460/09 Page 7 of 9 b. This Declaration shall be construed in accordance with the laws of the State of California. C. In the event action is instituted to enforce any of the provisions of this Declaration, the prevailing party in such action shall be entitled to recover from the other party thereto as part of the judgment, reasonable attorney's fees and costs. d. The Developer shall be required to take all reasonable steps necessary to insure that each tenant and all assignees, and transferors have knowledge of all terms and conditions of this Declaration. 9. Runs with the Land The covenants and agreements established in this Agreement shall, without regard to technical classification and designation, be binding on the Developer and any successor in interest to the Site, or any part thereof, for the benefit of and in favor of the Agency, its successor and assigns, and the City of Huntington Beach. The covenants against discrimination contained in paragraph 2 shall remain in effect in perpetuity. All other covenants shall remain in effect for the term of the Redevelopment Plan as it may be amended from time to time. IN WITNESS WHEREOF, the Agency and the Developer have executed this Declaration of Conditions, Covenants and Restrictions. REDEVELOPMENT AGENCY OF THE CITY OF HUNTINGTON BEACH, a public body corporate and politic Dated: By: Chairman "AGENCY" ATTEST: Agency Secretary 11/11/92 ATTACHMENT NO. 9 1927Q/2460/09 Page 8 of 9 APPROVED AS TO FORM: Stradling, Yocca, Carlson & Rauth, Agency Special Counsel COULTRUP COMPANIES, a California corporation By: Jon T. Coultrup, President BIRTCHER REAL ESTATE LIMITED, a California limited partnership By: BREICORP. , a California corporation, Managing General Partner By: Michael H. Voss, President "DEVELOPER" APPROVED AS TO FORM: Counsel to the Developer 11/11/92 ATTACHMENT NO. 9 1927Q/2460/09 Page 9 of 9 ATTACHMENT NO. 9A RECORDING REQUESTED BY ) AND WHEN RECORDED MAIL TO: ) [Space above for recorder.] This Agreement is recorded at the request and for the benefit of the Agency and is exempt from the payment of a recording fee pursuant to Government Code Section 6103. REDEVELOPMENT AGENCY OF THE CITY OF HUNTINGTON BEACH By: Its: Dated: 19 DECLARATION OF COVENANTS, CONDITIONS, AND RESTRICTIONS THIS DECLARATION OF COVENANTS, CONDITIONS, AND RESTRICTIONS (the "Declaration") is entered into this day of , 199 , by and between the REDEVELOPMENT AGENCY OF THE CITY OF HUNTINGTON BEACH, a public body corporate and politic (the "Agency") , and , an individual (the "Property Owner") , with reference to the following: A. The Property Owner is fee owner of record of that certain real property (a portion of the "Property Owner's Parcel") located in the City of Huntington Beach, County of Orange, State of California legally described in the attached Exhibit "A". The Property Owner's Parcel is the subject of a Disposition and Development Agreement between the Agency and the Property Owner (the "Agreement"). B. The Property Owner' s Parcel is within the Main Pier Redevelopment Project Area (the "Project") in the City of Huntington Beach and is subject to the provisions of the "Redevelopment Plan" for the Project adopted by Ordinance No. 2578 as amended by Ordinance Number 2634 by the City Council of the City of Huntington Beach. 11/11/92 ATTACHMENT NO. 9A 1927Q/2460/09 Page 1 of 9 C. The Agreement provides for the execution and recordation of this document. Except as otherwise expressly provided in this Agreement, all terms shall have the same meanings as set forth in the Agreement. NOW, THEREFORE, THE AGENCY AND THE DEVELOPER AGREE AS FOLLOWS: 1. Property Owner agrees to comply with all .provisions relating to the development of his parcel as provided in the Agreement. Such provisions include but are not limited to Section 107, Representation and Warranties as to the Property Owner's Parcel; Sections 301 to Section 308, Development of the Site as it relates to his parcel; Sections 310 to 315, Regulating Encumbrances; Section 401, Uses; Section 402, Maintenance of his parcel; Section 500 et seq. , general provisions; Section 600 et seq. , Defaults and Remedies; and Section 700 et seq. , Special Provisions all as relates specifically to issues concerning that individual Property Owner's Parcel. 2. Non-Discrimination The Property Owner, on behalf of itself and its successors, assigns, and each successor in interest to the Property Owner's Parcel or any part thereof, hereby covenants and agrees: (a) To use, devote, operate and maintain the Property Owner's Parcel and each part thereof, for the purposes and the residential uses specified in the Agreement and in the Redevelopment Plan. (b) Not to discriminate upon the basis of sex, marital status, race, color, creed, religion, national origin, or ancestry in the sale, lease, sublease, transfer or rental, or in the use, occupancy, tenure, or enjoyment of the Property Owner's Parcel or any improvements thereon, or of any part thereof. Each and every deed, lease, and contract entered into with respect to the Property Owner's Parcel shall contain or be subject to substantially the following nondiscrimination or nonsegregation clauses: (1) In deeds: "The grantee herein covenants by and for itself, it successors and assigns, and all persons claiming under or through them, that there shall be no discrimination against or segregation of any person or group of persons on account of sex, marital status, race, color, creed, religion, national origin, or ancestry in the sale, lease, rental, sublease, transfer, use occupancy, tenure, or enjoyment of the land herein conveyed, nor shall the grantee itself or any persons claiming under or through it, establish or permit any such practice or practices- of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees, or vendees in the land herein conveyed. The foregoing covenants shall run with the land." 11/11/92 ATTACHMENT NO. 9A 1927Q/2460/09 Page 2 of 9 (2) In leases: "The lessee herein covenants by and for itself, its successors and assigns, and all persons claiming under or through them, and this lease is made and accepted upon and subject to the following conditions: That there shall be no discrimination against or segregation of any person or group of persons, on account of sex, marital status, race, color, creed, religion, national origin, or ancestry, in the leasing, renting, subleasing, transferring, use, occupancy, tenure, or enjoyment of the land herein leased nor shall the lessee itself, or any person claiming under or through it, establish or permit such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, sublessees, subtenants, or vendees in the land herein leased." (3) In contracts: "There shall be no discrimination against or segregation of, any persons, or group of persons on account of sex, marital status, race, color, creed, religion, national origin, or ancestry in the sale, lease, rental, sublease, transfer, use, occupancy, tenure or enjoyment of the land, nor shall the transferee itself or any person claiming under or through it, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees or vendees of the land." 3. Inspection. To the extent permitted by law, the City of Huntington Beach and the Agency shall have the right of entry, at reasonable hours and upon no less than thirty (30) days advance notice, onto the Property Owner's Parcel to inspect for the need for repairs or maintenance. Entry onto the Property Owner's Parcel or into any unit for other than emergency repairs may be made only after such advance notice and request for entry. If request for entry is denied or the Property Owner's Parcel or applicable unit is unoccupied, the City or Agency may apply for an appropriate warrant or other order from a court of appropriate jurisdiction. 4. Exterior Maintenance. The exterior areas of the Property Owner's Parcel shall be kept free of rubbish, debris and other unsightly or unsanitary materials. The requirements in this Section shall also be incorporated into any covenants, conditions and restrictions which are administered by an association of owners in the Property Owner's Parcel or any portion of the Property Owner's Parcel. 11/11/92 ATTACHMENT NO. 9A 1927Q/2460/09 Page 3 of 9 a. Project Improvement, Maintenance and Repair (1) Land Use Areas and Improvements (a) Exterior yard areas and parking areas shall be kept free of deterioration, including: (i) Potholes (ii) Cracks in asphalt so as to become uneven, unsightly surface conditions (iii) Weeds growing through asphalt. (b) Perimeter fencing, landscaping and irrigation system shall be routinely inspected and maintained in good condition. b. Each occupant of the Property Owner's Parcel shall have the affirmative obligation to prevent what might be considered a fire hazard or a condition dangerous to the public health, safety and limited welfare; or constitute an unsightly appearance or otherwise detract from the aesthetic and property values of neighboring dwelling units and properties. The following minimum performance standards for the maintenance of buildings, yards, and landscaping shall be adhered to by the Property Owner: (1) Landscaping on the Property Owner's Parcel shall be absent of the following: (a) Lawns with grasses in excess of six (6) inches in height. (b) Untrimmed hedges. (c) Trees, shrubbery, lawns and other plant life dying from lack of water or other necessary maintenance. (d) Trees and shrubbery grown uncontrolled without proper pruning. (e) Vegetation so overgrown as to be likely to harbor rats or vermin. (f) Dead, decayed or diseased trees, weeds and other vegetation. (g) Inoperative irrigation system(s) . (2) Yard areas shall be maintained so as to be absent of the following: (a) Broken or discarded furniture, appliances and other household equipment stored in yard areas for periods exceeding one (1) week. 11/11/92 ATTACHMENT NO. 9A 1927Q/2460/09 Page 4 of 9 (b) Packing boxes, lumber, trash, dirt and other debris stored in yards for unreasonable periods in areas visible from public property or neighboring properties. (c) Unscreened trash cans, bins or containers stored for unreasonable periods in areas visible from public streets and common areas. (3) No building, wall or fence may be left in an unmaintained condition so that any of the following exist: (a) Buildings abandoned, boarded up, partially destroyed or left unreasonably in a state of partial construction. (a) Unpainted buildings or buildings with peeling paint in such a condition as to: i. Cause dry rot, warping and termite infestation; or ii. Constitute an unsightly appearance that detracts from the aesthetic or property values of neighboring properties. (c) Broken windows, constituting hazardous conditions and/or inviting trespassers and malicious mischief. (d) Damaged garage doors that may become inoperative or unsafe to operate. (e) Graffiti remaining on any portion of the property for a period exceeding five (5) days. (f) Building interiors and exteriors shall be maintained to meet standards of similar residential property in the City of Huntington Beach. 5. Agency and City Right of Review and Enforcement The Agency is a party to this Declaration and the City of Huntington Beach ("City") is hereby expressly made a third party beneficiary to this Declaration for the limited purposes as specified herein as follows: a. Changes or amendments to this Declaration must be submitted for City and Agency review and approval. b. In the event of inaction by the Property Owner, the City and Agency are hereby granted expedient power to enforce all provisions of this Declaration including, but not limited to, the maintenance of the Improvements and all yards, buildings and landscaping areas within the Property Owner' s Parcel. All costs and expenses incurred by the City and/or the Agency arising 11/11/92 ATTACHMENT NO. 9A 1927Q/2460/09 Page 5 of 9 out of such enforcement and maintenance shall be charged as an expense of the Property Owner and shall be paid within ten (10) days of receipt of an invoice for same. C. The City and Agency are hereby granted the express power to enforce all laws and ordinances of the State of California and/or the City of Huntington Beach on yards, structures, and private parking areas within the Property Owner's Parcel. Nothing within this Declaration, however, shall be construed as imposing an obligation or requiring the City or Agency to enforce any provision thereof. d. The City and the Agency shall be given prior written notice of any proposed amendment to this Declaration. Such notice shall be given by mailing a copy of the precise language of the proposed amendment to the City of Huntington Beach, c/o City Clerk, together with a letter of transmittal explaining the proposed change in limited terms. The City and the Agency shall have an opportunity to review and comment upon the proposed amendment for a period of not less than forty-five (45) days prior to the effective date of any such proposed amendment. If the City or Agency fail to respond within forty-five (45) days, the proposed change(s) and amendment(s) shall be deemed approved, unless that time period is extended by mutual agreement of all parties. 6. City of Huntington Beach Right of Entry for Code Enforcement, Repair and Traffic Regulation (a) Right of Entry. To the extent permitted by law, Property Owner hereby acknowledges and intends and thus grants to the City and the Agency, through the City's duly authorized agents or employees, the right to enter upon the Property Owner's Parcel for the following purposes: (1) Inspection, maintenance and repair of the Property Owner's Parcel. (2) Enforcement of local traffic and/or parking regulations. (b) Reimbursements of City Expenditures. All costs and expenses incurred by the City and/or the Agency arising out of its inspection, maintenance and repair of the Property Owner's Parcel, as provided hereinabove ("City Maintenance Costs") , shall be charged as an expense of the Property Owner and shall be paid within ten (10) days of receipt of an invoice for same. (c) Assessments and Lien Rights of the City. If City Maintenance Costs and/or those costs incurred relating to enforcement or maintenance as set forth in Section 10 above of this Article are not paid within thirty (30) days from the date due, said unpaid costs and expenses shall become a special assessment against the Property Owner's Parcel and, upon confirmation by the City Council, shall be collected in the same manner as real property taxes and shall be subject to the same penalties, procedures and sale in case of delinquency as is provided for real property taxes. 11/11/92 ATTACHMENT NO. 9A 1927Q/2460/09 Page 6 of 9 7. Mortgage Protection Notwithstanding any and all provisions elsewhere in this Declaration to the contrary, in order to induce lenders and investors to participate in the financing of the Property Owner Improvements, the following provisions are added hereto, and, except as to the effectiveness and enforceability of the Affordable Unit requirements set forth herein, to the extent these added provisions conflict with any other provisions of this Declaration, these added provisions shall control: (a) Any mortgagee or third party foreclosure purchaser who comes into possession or who obtains title to the Property Owner's Parcel pursuant to the remedies provided in the mortgage or foreclosure of the mortgage, or by deed or assignment in lieu of foreclosure, will not be liable for such Property Owner's Parcel's unpaid charges which accrue prior to such possession or acquisition of title. The assessment liens provided for herein shall be subordinate to the lien or equivalent security interest of any mortgage recorded prior to the date any such charges become due. Such subordination shall apply only to assessments which accrue prior to a sale or transfer of such Property Owner' s Parcel pursuant to a decree of foreclosure or trustee's sale. Such sale or transfer shall not relieve such Property Owner's Parcel from liability for any assessments thereafter becoming due or from the lien of any such subsequent assessment. (b) Mortgagees shall have the right to examine the books and records of the Property Owner during normal business hours. (c) In the event of substantial damage to or destruction of the Property Owner's Parcel or any portion thereof, the mortgagee of any mortgage on the Property Owner's Parcel shall be entitled to timely written notice of any such damage or destruction, and no provision in this Declaration shall be interpreted to entitle the Property Owner or any other party to priority over any rights of the mortgagee of the Property Owner's Parcel pursuant to its mortgage in the case of a distribution to such Property Owner of insurance proceeds or condemnation awards for losses to or a taking of the Property Owner's Parcel. (d) If the Property Owner's Parcel or portion thereof is made the subject matter of any condemnation or eminent domain proceeding or is otherwise sought to be acquired by a condemning authority, then the mortgagee of any mortgage will be entitled to timely written notice of any such proceeding or proposed acquisition, and no provision in this Declaration shall be interpreted to entitle the Property Owner or any other party to priority over such mortgagee with respect to the distribution to such lot of the proceeds of any award or settlement. (e) As used in this Section 12, "mortgagee" means any mortgagee under a mortgage which is a lien of record made in good faith and for value, or a junior lien of record made in good faith and for value by the City, the Agency or an institutional lender in order to assist in the financing of the construction of the Improvements. .11/11/92 ATTACHMENT NO. 9A 1927Q/2460/09 Page 7 of 9 (f) No violation of this Declaration shall render invalid or defeat the mortgage of the first mortgagee. 8. Miscellaneous Provisions a. If any provision of this Declaration or portion thereof, or the application to any person or circumstances, shall .to any extent be held invalid, inoperative or unenforceable, the remainder of this Declaration, or the application of such provision or portion thereof to any other persons or circumstances, shall not be affected thereby; it shall not be deemed that any such invalid provision affects the consideration for this Declaration; and each provision of this Declaration shall be valid and enforceable to the fullest extent permitted by law. b. This Declaration shall be construed in accordance with the laws of the State of California. C. In the event action is instituted to enforce any of the provisions of this Declaration, the prevailing party in such action shall be entitled to recover from the other party thereto as part of the judgment, reasonable attorney' s fees and costs. d. The Property Owner shall be required to take all reasonable steps necessary to insure that each tenant and all assignees, and transferors have knowledge of all terms and conditions of this Declaration. 9. Runs with the Land The covenants and agreements established in this Agreement shall, without regard to technical classification and designation, be binding on the Property Owner and any successor in interest to the Property Owner's Parcel, or any part thereof, for the benefit of and in favor of the Agency, its successor and assigns, and the City of Huntington Beach. The covenants against discrimination contained in paragraph 2 shall remain in effect in perpetuity. All other covenants shall remain in effect for the term of the Redevelopment Plan as it may be amended from time time. IN WITNESS WHEREOF, the Agency and the Property Owner have executed this Declaration of Conditions, Covenants and Restrictions. REDEVELOPMENT AGENCY OF THE CITY OF HUNTINGTON BEACH, a public body corporate and politic Dated: By: Chairman "AGENCY" 11/11/92 ATTACHMENT NO. 9A 1927Q/2460/09 Page 8 of 9 ATTEST: Agency Secretary APPROVED AS TO FORM: Stradling, Yocca, Carlson & Rauth, Agency Special Counsel Dated: By: Its: Dated: By: Its: "PROPERTY OWNER" APPROVED AS TO FORM: Counsel to the Property Owner 11/11/92 ATTACHMENT NO. 9A 1927Q/2460/09 Page 9 of 9 STATE OF CALIFORNIA ) ss. COUNTY OF ORANGE ) On this day of 19 before me, the undersigned, a Notary Public in and for said State, personally appeared , known to me (or proved to me on the basis of satisfactory evidence) to be the person who executed this instrument as the Chairman of the Huntington Beach Agency for Community Development and acknowledged to me that the Huntington Beach Agency for Community Development executed it. Signature of Notary Public (SEAL) STATE OF CALIFORNIA ) } ss. COUNTY OF ORANGE ) On 19_, before me, the undersigned, a Notary Public in and for said State, personally appeared and , personally known to me or proved to me on the basis of satisfactory evidence to be the persons who executed the within instrument as limited partners of the limited partnership that executed the within instrument, and acknowledged to me that such limited partnership executed the same. WITNESS my hand and official seal. 11/11/92 1927Q/2460/09 ATTACHMENT NO. 9-A STATE OF CALIFORNIA ) ss. COUNTY OF ORANGE ) On 19_, before me, the undersigned, a Notary Public in and for said State, personally appeared and , personally known to me or proved to me on the basis of satisfactory evidence to be the persons who executed the within instrument as limited- partners of the limited partnership that executed the within instrument, and acknowledged to me that such limited partnership executed the same. WITNESS my hand and official seal. 11/11/92 1927Q/2460/09 ATTACHMENT NO. 9-A ATTACHMENT NO. 9-A EXHIBIT A Legal Description 11/11/92 EXHIBIT A 1927Q/2460/09 ATTACHMENT NO. 9-A ATTACHMENT NO. 10 GUARANTY AND AGREEMENT OF BIRTCHER REAL ESTATE LIMITED THE REDEVELOPMENT AGENCY OF THE CITY OF HUNTINGTON BEACH (the "Agency") and BIRTCHER REAL ESTATE LIMITED, a California limited partnership (the "Developer") have entered into a Disposition and Development Agreement dated as of , 1992 (the "Agreement") . The Agreement provides that BIRTCHER REAL ESTATE LIMITED (the "Guarantor") shall make and deliver a guaranty as provided in the Agreement. R E C I T A L S A. The Guarantor will benefit by the Agreement. The Agreement will redevelop and increase commercial activity within the vicinity .of the "Site" (as Site is defined in the Agreement) . B. The execution by the Guarantor of this Guaranty is a condition but for which the Agency would not execute the Agreement. C. The Guarantor has reviewed this Guaranty and the Agreement with counsel of its choosing. In consideration of the execution of the Agreement and of other valuable consideration, receipt of which is hereby acknowledged: 1. Guarantor guarantees to each of Agency the full, timely and faithful performance by Developer of all of its obligations, duties, promises, covenants and agreements as set forth in the Agreement, including without limitation development of the Developer Improvements and the payment of the Agency Equity Participation Amount and all other consideration payable by the Developer pursuant to the Agreement. Guarantor' s obligations and rights hereunder are coextensive with Developer' s and this guaranty does not seek to impose any grater responsibilities on the Guarantor than those responsibilities which may be enforced against the Developer, 2. This Guaranty is unconditional and may be enforced directly against the Guarantor. No extensions, modifications or changes to the Agreement shall release the Guarantor or affect this Guaranty in any way, and the Guarantor waives notification thereof. 11/11/92 ATTACHMENT NO. 10 1927Q/2460/09 Page 1 of 5 3. The Guarantor hereby waives all of the suretyship provisions of the California Civil Code Sections 2788 through 2855. 4. Guarantor waives: (a) any defense based upon any legal disability or other defense of Developer, any other guarantor or other person or by reason of the cessation or limitation of the liability of Developer from any cause other than full payment of all sums payable under the Agreement (including without limitation the Attachments thereto) ; (b) any defense based upon any lack of authority of the officers, directors, partners or agents acting or purporting to act on behalf of Developer or any principal of Developer or any defect in the formation of Developer or any principal of Developer; (c) any defense based upon the application by Developer of the funds for purposes other than the purposes represented by Developer to Agency or intended or understood by Agency or Guarantor; (d) any defense based upon Agency' s election of any remedy against Guarantor or Developer or both including, without limitation, election by Agency to exercise its rights under the power of sale set forth in the Deed of Trust (Attachment No. 7 to the Agreement) and the consequent loss by Guarantor of the right to recover any deficiency from Developer; (e) any defense based upon Agency' s failure to disclose to Guarantor any information concerning Developer' s financial condition or any other circumstances bearing on Developer' s ability to pay all sums payable under the Agreement (including without limitation the Attachments thereto) ; (f) any defense based upon any statute or rule of law which provides that the obligation of a surety must be neither larger in amount nor in any other respects more burdensome than that of a principal; (g) any defense based upon Agency' s election, in any proceeding instituted under the Federal Bankruptcy Code, of the application of Section 1111(b) (2) of the Federal Bankruptcy Code or any successor statute; (h) any defense based upon any borrowing or any grant of a security interest under Section 364 of the Federal Bankruptcy Code; (i) any right of subrogation, any right to enforce any remedy which Agency may have against Developer or any other guarantors and any right to participate in, or benefit from, any security for the Agreement or the Creditor Agreement (including without limitation the Attachments thereto) now or hereafter held by Agency; (j ) presentment, demand, protest and notice of any kind; and (k) the benefit of any statute of limitations affecting the liability of Guarantor hereunder or the enforcement hereof. Guarantor agrees that the payment of all sums payable under the Agreement (including without limitation the Attachments thereto) or any part thereof or other act which tolls any statute of limitations applicable to the Agreement (including without limitation the Attachments thereto) shall similarly operate to toll the statute of limitations applicable to Guarantor' s liability hereunder. Without limiting the generality of the foregoing or any other provision hereof,- 11/11/92 ATTACHMENT NO. 10 1927Q/2460/09 Page 2 of 5 Guarantor expressly waives any and all benefits which might otherwise be available to Guarantor under California Civil Code Sections 2809, 2810, 2819, 2839, 2845, 2849, 2850, 2899 and 3433 and California Code of Civil Procedure Sections 580(a), 580(b), 580(d) and 726, or any of such sections. S. Guarantor hereby waives and agrees not to assert or take advantage of (a) any right to require Agency to proceed against the Developer (or any guarantor other than the undersigned) or to pursue any other remedy in the Agency' s power before proceeding against the Guarantor, (b) demand, protest, and notice which the Agency may be required to be provided to Developer under the Agreement, and (c) any duty on the part of Agency to disclose to Guarantor any facts Agency or the City of Huntington Beach now or hereafter know about the Site, the Agreement, or the Developer, regardless of whether Agency has reason to believe that any such facts materially increase the risks beyond that which Guarantor intends to assume or has reason to believe that such facts are unknown to Guarantor or has a reasonable opportunity to communicate such facts to Guarantor, it being understood and agreed that Guarantor is fully responsible for being and keeping informed of all circumstances regarding the Site, the Agreement, the obligations of the Developer, the financial condition of the Developer or any of the Interested Persons and of all circumstances bearing on the risk of any obligation by Developer (and all of the Interested Persons) hereby guaranteed. 6. Guarantor shall have no right of subrogation and waives any right to enforce any remedy the Agency now has or may hereafter have against the Developer, and any benefit of, and any right to participate in any security now or hereafter held by Agency. 7. The obligations of Guarantor hereunder are independent of the obligations of Developer and, in the event of default hereunder, a separate action or actions may be brought and prosecuted against Guarantor (or any other guarantor) whether or not Developer (or any other guarantor) is joined therein or a separate action or actions are brought against Developer. 8. In the event of any litigation between Agency and Guarantor arising out of this Guaranty, the prevailing party shall be entitled to recover its reasonable costs and attorney' s fees. 9. No provision of this Guaranty can be waived nor can Guarantor be released from the obligations hereunder except by a writing duly executed by the Agency. 10. Guarantor agrees to pay all reasonable attorney's fees and all other costs and expenses which may be incurred by 11/11/92 ATTACHMENT NO. 10 1927Q/2460/09 Page 3 of 5 Agency in enforcing or attempting to enforce this Guaranty, whether the same shall be enforced by suit or otherwise. 11. Guarantor hereby waives notice of any demand by the Agency, as well as notice of any default by the Developer. 12. This guaranty is intended to be solely for the benefit of the Agency, the City and any successor in interest due to the operation of law. It is not intended to be for the benefit of any third party. 13. This Guaranty shall remain in effect notwithstanding any bankruptcy, reorganization or insolvency of the Developer or any successor or assignee thereof or any disaffirmance by a trustee of the Developer. 14. This Guaranty shall inure to the benefit of and bind the successors and assigns of Agency and Guarantor. 15. Guarantor agrees that jurisdiction and venue with respect to any matter pertaining to the Guaranty or acts or omissions hereunder shall lie exclusively with the Superior Court of the County of San Bernardino, State of California, in an appropriate municipal court of that county, or in the Federal District Court in the Central District of California. Guarantor irrevocably waives any and all defenses based upon revenue or forum non conveniens. 16. The laws of the State of California shall govern the interpretation and enforcement of this Guaranty. IN WITNESS WHEREOF, the undersigned has executed this Guaranty this day of 1992. By: Its; By: Its: 11/11/92 ATTACHMENT NO. 10 1927Q/2460/09 Page' 4 of 5 STATE OF CALIFORNIA ) } ss. COUNTY OF } On before me, the undersigned, a Notary Public in and for said State, personally appeared , personally known to me or proved to me on the basis of satisfactory evidence to be the person who executed the within instrument as the Managing Partner, and , personally known to me or proved to me on the basis of satisfactory evidence to be the person who executed the within - instrument as the Managing Partner of the limited partnership that executed the within instrument. WITNESS my hand and official seal. (SEAL) 11/11/92 ATTACHMENT NO. 10 1927Q/2460/09 Page 5 of 5 ATTACHMENT NO. I GENERAL PARTNERSHIP AGREEMENT OF MAIN-PIER PHASE It PARTNERSHIP (ON FILE WITH CITY CLERK'S OFFICE) ATTACHMENT NO. 12 EQUITY PARTICIPATION PROCEDURE I. AGENCY PARTICIPATION AMOUNT FOR BLOCK 105 Developer has agreed to pay Agency fifty percent (50%) of its "Net Sales Proceeds" (as defined herein) in excess of the total of (i) one hundred percent (100%) of "Developer Costs, " (as defined below) ; (ii) a 10% annualized and compounded return on equity investment; and (iii) three million two hundred thousand dollars ($3,200,000.00) . This participation is hereinafter referred to as the "Agency Participation Amount" and is secured by Deed of Trust (Attachment No. 7) recorded on Block 205 of Site. I. The "Development Costs" shall include: (i) all reasonable and customary hard and soft costs and fees paid by Developer to third parties in connection with the acquisition, financing, ownership, operation, maintenance, development, and sale of the Project as contemplated by the DDA (both Block 104 and 105) , including, without limitation, legal fees and costs, loan interest, points, commissions, and origination fees, public entity permits and fees, cost of sales including sales person administration, advertising, sale model unit furnishing; (ii) Developer overhead equal to three percent (3%) of the gross sales price of the Project; (iii ) general contractor' s fee of twelve percent (12%) of the direct construction budget and (iv) such other non-third party costs as may be approved by Agency, which approval shall not be unreasonably withheld. Within sixty (60) days after the completion of construction, Participant shall submit to Agency for its review and approval a detailed account of the Development Costs of the Project from inception through the date of issuance of a Certificate of Occupancy ("Effective Date") . After the Effective Date until all condominium units are sold, Participant shall submit on a monthly basis a detailed account of the Development Costs incurred since the Certificate of Occupancy, and the information necessary to calculate the Net Sales Proceeds (as defined below) . 2. The "Net Sales Proceeds" shall include: (i) the gross sales proceeds from the sale of condominium units less all third party costs, including, without limitation, the following: brokerage commissions; escrow costs, state, county, city or other documentary stamps and transfer taxes; recording fees; notary fees; ad valorem taxes, if any, upon that unit for any time prior to conveyance of title; warranty costs, title insurance costs paid by 11/11/92 ATTACHMENT NO. 12 1927Q/2450/09 Pagel of 5 Developer, homeowner association fees paid by Developer and similar costs and charges. (ii) If any units are rented rather than sold, the parties shall deem the unit sold as of the date of occupancy, and the fair market value of such unit as of the date of occupancy shall be included in Net Sales Proceeds. Developer shall submit to Agency its calculation of such unit' s fair market value together with Developer' s calculations and assumptions used to compute such value. As used herein, "Fair Market Value" means the highest price on the date of valuation that would be agreed to by a seller, being willing to sell but under no particular or urgent necessity for so doing, nor obliged to sell, and a buyer, being ready, willing, and able to buy but under no particular necessity for so doing, each dealing with the other with full knowledge of all the uses and purposes for which the property is reasonably adaptable and available; and (iii) net proceeds of any permanent financing, refinancing or other disposition of Block 105 apart from the sale of individual units to users after deduction for all costs incurred in connection with obtaining such financing. 3. In the event of a foreclosure of any mortgage (or transfer by deed in lieu thereof) encumbering Block 105, Agency' s right to receive the Agency Participation Amount with respect to such transfer shall be subordinate to the applicable mortgagee's right to receive proceeds in the full amount of all outstanding obligations secured by such mortgage. Ix. INSPECTION OF BOOKS AND RECORDS Developer shall keep full and accurate books and accounts, records, cash receipts, and other pertinent data directly related to the calculation of Agency Participation Amounts submitted by Developer under Section I above ("Records" ) . Such Records shall be kept for a period of two (2) years after the end of the sale of the last condominium unit. Agency shall be entitled, not more than two (2) times per calendar year to inspect, examine and copy, at Agency' s sole expense, the Records relevant to the calculation of the Agency Participation Amount, provided that such inspection, examination and copying shall be upon three (3) days' prior notice to Developer. Such inspection, examination and copying shall be made at such time and place as Developer may reasonably designate. Any transfer of Records for such inspection, examination and copying shall- be at Agency' s sole expense. Developer shall cooperate fully with Agency in making the inspection. Agency shall not divulge any information gained from such inspection other than to carry out the purposes of this Section II and Section I above; provided, however, that Agency shall be permitted to divulge the contents of any such inspection in connection with any 11/21/92 ATTACHMENT NO. 12 1927Q/2460/09 Page 2 of 5 administrative or judicial proceedings in which Agency is involved where Agency is required to divulge such information. 1. Right to Audit. In the event of a dispute between Agency and Developer regarding the calculations of the Agency Participation Amount, Agency or its designated agent shall have the right to audit the Records for the purpose of verifying the Agency Participation Amount subject to the following terms and conditions: (a) Agency shall have the right to make such audit, not more than once for any calendar year. (b) Agency shall give Developer at least fifteen (15) days' written notice of its desire to conduct such audit, and such audit shall be made at such time and place as Developer may reasonably designated; (c) Such audit shall be limited to the Records relevant to the calculation and payment of Agency' s Participation Amount; (d) Such audit shall be performed by an independent certified public accountant or by Agency's or City' s in-house auditor (the "Auditor" ) ; 2. Waiver. If Agency has not performed an audit within three years after the sale by Developer of all condominium units, then Agency shall be deemed to have waived its right to audit the Records, and the facts contained in Developer' s determination of Agency' s Participation Amount shall be conclusive and binding upon Agency. 3. Result of Audit/Participant Challenge. Within 20 days following any audit performed by AGency, Agency shall provide Developer with an audit report setting forth the Auditor' s findings in reasonable detail, including any schedules or attachments necessary to interpret such findings (the "Audit Report") . The Audit Report shall be accomplished by Agency' s written demand for payment (pursuant to Subsection 609.4 below) if an underpayment is disclosed by the Audit Report. Developer shall have a period of thirty (30) days following its receipt of the Audit Report in which to review the Audit Report, interview the Audit (who shall be made reasonably available to Developer during such period) and, if Developer reasonably determines based upon its review of the Audit Report to dispute the results of any audit conducted by Agency, provide Agency with written objections stating in reasonable detail Developer' s specific objections to the Audit Report. For a period of ninety (90) days following the delivery of Developer's challenge to Agency, Developer and 21/21/92 ATTACHMENT NO. 12 1927Q/2460/09 Page 3 of 5 Agency shall negotiate in good faith in order to resolve any dispute concerning the Audit Report. If Developer and Agency fail to resolve each issue in dispute concerning the results of an audit within ninety (90) days following Developer' s receipt of the Audit Report, either party may seek resolution of such disputed issues by arbitration as provided in 608.5. In such event, neither Agency nor Developer shall be in default with respect to such underpayment or overpayment and the payment of any sums shown to be owing to Agency or Developer by such audit, including any underpayment or overpayment of the Agency Participation Amount, shall be payable in accordance with Subsections 11.4 and II .5 below, as applicable. 4. Underpayment. In the event an unchallenged audit (including an audit, or portion thereof, which is disputed but then such dispute is resolved) or final judicial determination, as the case may be, discloses an underpayment of the Agency Participation Amount, Developer shall pay the amount of such underpayment (or the undisputed portion thereof) within thirty (30) days after the later of the date (a) Developer receives the Audit Report and Agency' s written demand to pay such underpayment; (b) a disputed audit, or the applicable portion thereof, is resolved; or (c) a final judicial determination of a disputed audit is rendered that discloses such underpayment ("Underpayment Determination Date" ) . Interest shall accrue at the Reference Rate announced by the Bank of America from time to time ("Reference Rate") on the amount of such underpayment from the day the underpayment was due until paid; provided, that in the event that the underpayment exceeds 37. of the amount of Agency Participation Amount actually owing, interest shall accrue at the Reference Rate plus 3% on the amount of such underpayment was due until paid. In the event such underpayment exceeds 5% of the amount of the Agency Participation Amount actually owing, then Developer shall reimburse Agency for all reasonable costs and expenses incurred by Agency in connection with any audit and/or judicial action. Except as set forth in the preceding sentence, Agency shall pay its own cost of any audit and/or judicial action. In no event shall the failure by Developer to pay such underpayment at the time it would have otherwise been due under this Lease constitute a Default in the payment of rent under this Lease, provided the amount of such underpayment is paid within such thirty (30) day period after the Underpayment Determination Date, nor shall participant be subject to any fee, penalty or liquidated damages on account of such underpayment. 5. Overpayment. In the event an unchallenged audit (including an audit, or portion thereof, which is disputed but then resolved) or final judicial determination, as the case may be, discloses an overpayment of the Agency Participation Amount, Agency shall pay the amount of such overpayment (or the undisputed portion thereof) within thirty (30) days after the later of the date (a) Developer receives the Audit Report 21/11/92 ATTACHMENT NO. 12 1927Q/2460/09 Page 4 of 5 disclosing such overpayment; (b) a disputed audit, or the applicable portion thereof, is resolved; or (c) a final judicial determination of a disputed audit is rendered that discloses such overpayment ("Overpayment Determination Date") . Interest shall accrue at the Reference Rate on the amount due but unpaid as of the Overpayment Determination Date. 11/11/92 ATTACHMENT NO. 12 1927Q/2460/09 Page 5 of 5 ATTACHMENT NO. 13 PROJECT TAKE OUT LOANS PROPERTY OWNERS PROP. OWNER EST. MAX. CONST. 70% BLOCK 104 INCLDG. 10% CONTNGY LOAN F. Alfonso $ 725, 000 $ 507,500 E. Bagstad 1, 185,000 825, 500 F. Cracchiolo 1, 178, 000 824, 600 G. Draper 507,000 354, 900 A. Mase 725, 000 507, 500 G. Mulligan 522, 000 365, 400 $4, 842, 000 $3, 385,400 Interest subsidy assistance shall only be available for those Property Owners unable to achieve an 8 percent or less fully amortized, 15 year loan with three (3 ) percentage points in fees. The amount of interest subsidy shall be a maximum of two percent. The subsidy is less if all that is needed to reduce payment to the eight percent. Interest subsidy assistance shall be calculated based on the fifteen year fully amortized payment schedule; reduced to its present value. The maximum cap for each Property owner shall be prorated among each of the above Property Owners based on the above estimated loan values. In no event shall the total present value interest subsidy assistance exceed the maximum amount of Four Hundred and Ninety Thousand Dollars ($490, 000. ) . Nor shall any Property Owner obtain greater than the prorated maximum amount for his loan irregardless of whether the entire maximum amount is utilized. 11/11/92 ATTACHMENT NO. 13 1927Q/2460/09 Page 1 of 1 ATTACHMENT NO. 14 ESTIMATE OF BLOCK 104 COSTS CONTRIBUTION TO BLOCK 104 COULTRUP COMMERCIAL $200, 000 Relocation Maximum 8,000 Soils Testing 50, 000 Demolition 17, 000 Sewer Lateral 9, 800 Civil Engineer 50,000 Architect & Engineer 1,900 City Fees 20,000 Attorney 45, 000 Bonds 62,500 Hazardous Materials $464,200 11/11/92 ATTACHMENT NO. 14 1927Q/2460/09 Page 1 of 1